Jul 20, 2015 | Branding, Marketing, Small business, Social Media
Myth 1. Fans, followers, and likes are valuable.
Reality. What you need to attract to your site is people who for one reason or another are willing to part with their money in exchange for what you have, or at least move towards that decision point. There are only two reasons for a website, the first is as a hobby, the second is commercial. Assuming yours is for the latter, act accordingly.
Myth 2. I have too do it all myself to be “authentic”.
Reality. Only partly true. If you are selling personalised services, there is some expectation that the voice of the person and the “voice” of the written words and other forms of content are the same, then you need to be involved in the editing, not necessarily the writing. However, my experience is that in the small business space, authenticity is very valuable, not so much in the corporate space.
Myth 3. You need to be on every platform.
Reality. Bunkum. Every platform is different, with a different user profile, user objective and type of response. Even for big corporations, diminishing returns kick in, and for small businesses, the task is simply overwhelming. I usually recommend to my small business clients 2, at most three, but do them properly.
Myth 4. Social media is not all that important, it is just where he kids go.
Reality. Aren’t kids your current and future customers? Social Media is the greatest competitive tool ever offered to small businesses, but like any tool, it can be used well and deliver huge value, or it can bite you in the arse.
Myth 5. I can wing it.
Reality. Some can, but they are very organised, have a strategy, and business objectives against which they measure themselves, but this is rare in my experience. Usually “winging it” means putting a post on Facebook at some point convenient, or tweeting a picture of yourself when at the pub. Both rarely work.
Myth 6. Social media is dangerous and unmanageable.
Reality. Social media can be dangerous when left to itself, it has the capacity to trash your biggest asset, your brand, almost overnight. On the other hand, like most dangerous things, it can be tamed and used to your advantage with knowledge, commitment, and skill.
Myth 7. Social media is all smoke and mirrors
Reality. Social media is now highly quantitative, able to give accurate and repeatable quantitative outcomes very quickly and cheaply. It can be reliable and accurate market research on the run, but it is also the first marketing tool to offer an ROI calculation on the investments made.
Myth 8. Social media is just too hard, I have too much else to do.
Reality. You cannot afford not to be engaged with Social media, it opens up the possibility of talking directly to your customers, and their friends, marketing nirvana. It is however, a consumer of considerable resources, and is not free. Many small business owners do not have the skills so they shy away, but the skills are readily available to either teach you, or as outsourced resources. Digital technology has opened up huge opportunities to free up our time, why not spend some of it talking to customers?
The simple fact is that Social Media is part of our marketing environment, it currently attracts almost half the advertising dollar, is now pretty much the only way to effectively reach large sections of consumers and customers, and for small businesses, is marketing manna from a digital heaven.
Jul 16, 2015 | Branding
image courtesy brandonsteiner.com
People in market research always describe brands in human terms, they are tough, or easy to live with, or friendly, cold, and so on.
It is the easiest way to describe them.
It follows then that when thinking about the dimensions of your brand, you would do it using “the brand as a friend” as the guiding metaphor.
Ask yourself a few simple questions:
- What do your customers expect from your brand?
- What changes would customers accept from your brand?
- What will customers reward your brand for delivering?
When you can answer them accurately and confidently, you will have a very good picture of your brand.
A while ago I was yarning to the Mum of one of my oldest friends, we met at University, 40 years ago. She was expressing delight that after 40 years Dave and I were still mates. May not see each other for quite a while, but it made no difference at all when we met up again, it is as if it was yesterday we last shared a coffee. (more often a beer)
My response was that old mates are the best mates, because there were few expectations, few surprises, and when they did show up, there were insignificant in the context of the long relationship.
Same with brands.
How would you describe yours?
Jul 9, 2015 | Branding, Customers, Demand chains, Marketing, Strategy
All those brand stories: gone.
Every now and again I see something so stupid, so irrational, and so destructive of a valuable brand, that I think that perhaps the loonies really do have the keys to the asylum.
One of them happened yesterday.
There was a radio news report that Akubra would cease to buy any of the raw material required for their hats, rabbit skins, from Australian suppliers.
From here on they would be using 100% imported skins.
One of the honchos from Akubra was interviewed, and he was blathering about looking after all stakeholders, that sacrificing 4-5 jobs in Kempsey where the hats are made was worth it to ensure the business remained viable, and that the 5,000 retailers around Australia needed to be assured of continuous supply, or they would be in trouble.
Blimey, stone the crows, 5,000 retailers rioting because there is uncertainty about the viability of a supplier of .00000001% of their sales.
Then it turned out that just 10% of current skin supplies were local anyway, as the khaleesi virus has cut a swathe through rabbit numbers, for which we are all thankful. Then a supplier was interviewed. He breeds rabbits for the table, the skins to Akubra are a very useful addition to his cash flow, important even, but not make or break, so now the skins will go to landfill.
How much better it would have been to set about supporting the Australian industry, modernising their equipment, working with their suppliers, so that this Australian icon could continue to grow, particularly as wild rabbit numbers seem to be increasing as the virus becomes less effective.
What a positive brand story they could have created and spread, reinforcing the existing position, telling the stories that are the foundation of their brand, but instead they chose to trash their brand, built up over 100 years plus.
Your brand is an amalgam of all the stories told about you, your products, the situations encountered, and the experiences users have with the products. The stories Akubra could tell are legion, but instead they choose to self-destruct their most valuable asset.
Next thing you know, a global brand like Coke will replace itself. Oh, poop, they already did.
Sigh.
Let the loonies go free.
Jul 8, 2015 | Branding, Customers, Marketing, Sales, Small business
Free works
It happened again last week.
A client asked why I advocated giving away a lot of information on their products and supporting technology, seemingly for free off their website. For them it is a challenging idea, one that runs against everything they have ever thought or done.
Their products are challenging, technical products, heavy in intellectual capital, so why give it away?.
To answer, I created the following list, and it is all about creating value before asking for the purchase order. Do it well, and customers do not have to be sold, they become buyers.
Provide assistance. Information assists potential customers to recognise that they have a problem, an opportunity, or that there may be a better way of approaching a situation.
Demonstrate. By demonstrating how their problems will be solved, enabling comparisons, and offering technical and financial case studies, the cost/benefits of a purchase can be more easily calculated. This makes the internal purchase approval processes easier for those charged with their carriage in a customers business.
Risk identification. Risks of adoption, and non-adoption can be articulated, demonstrated, and often costed and compared.
Learn. Information offers a prospect the opportunity to learn without the costs usually associated with learning, and they will not forget the opportunity.
Decision necessary information. Availability of strategically significant information from a supplier can accelerate the adoption and implementation of new products and processes, delivering a market benefit.
For my client, the list of benefits is as significant, and in this information driven modern commercial world virtually a competitive necessity.
Be expert. We will be seen as the experts in the market, and who would want to buy from an also ran?
Cycle time. It has the potential to shorten the sales cycle by removing some of the steps normally associated with such B2B sales of significant size
Conversion cost reduction. As a result of both of the previous items together, our cost of conversion from random and often unknown prospect to a transaction is likely to be reduced, and the numbers increased leveraging the costs of our sales effort.
Short listed. Information availability increases the chances that at least we get onto the short list of those who are considering making a purchase, but who may not be in our immediate sales radar.
Sales funnel information. Downloading of various material by prospects gives us not only information on who is in the market, but what they are looking for, and leads on their specific interests and concerns.
Build a brand. The biggest benefit of all is that of the building of the brand, the position of expertise in the market. In this day of ubiquitous information, being seen as the expert in any domain is a hugely valuable asset.
Being secretive, and believing that information held closely is power is now a failed strategy. It worked in the past, but no longer. Information is still power, but the way you leverage it has changed radically.
Jun 22, 2015 | Branding, Customers, Marketing, retail, Small business
retail crash test dummies abound
Watching the rather sloppy way Grant O’Brien was moved on by Woolworths last week, I got to thinking about all the converging things happening that will impact the FMCG landscape over the next few years. A superficial look would suggest that things are pretty set, and change that happens will be incremental, but a closer look would suggest there is a lot of paddling going on under the surface.
These are the things I see:
Coles resurgent.
In the 40 years I have been around, I have seen the pendulum swing a couple of times, and it looks like Westfarmers have pulled off another mighty swing with Coles. Across pretty much any parameter you choose to look at, they are catching or have caught Woolworths, and remain on the improve.
Woolworths momentum.
In this high fixed cost retailing game, momentum is a huge contributor, not just to the financial outcomes, but to the day to day operations and shop floor “feel”. The momentum seems to be all against Woolies now, after enjoying the benefits for a long period. Their failure to drain cash from Coles by putting pressure on Bunnings with Masters has not just crunched their financial results, but it seems to have knocked the wind out of their confidence at the sales face across all their formats except perhaps Dan Murphy’s, which seems to be bucking the trend. Woolworths do not have a player in the office supplies game, which must be hurting them, further draining competitive resources.
Discounters are winning.
Aldi is doing really well, opening stores and taking share hand over fist. I have not seen the figures that would substantiate the notion that woolies are losing more to Aldi than Coles, but it would not surprise me at all. On top of Aldi’s blitzkrieg, it seems that their German competitor Lidl is coming. Lidl is a potent long term competitor with substantial experience across many markets.
Costco is seemingly carving out a niche, although not as aggressively as was first forecast, but the crowds in the Costco store at Auburn in Sydney would suggest they are not going away any time soon.
The $A.
After a period well above US $ par, the Aussie is back to more like its long term position. However, the carnage wrought by those few years on the mid sized supplier base cannot be turned around. Retailers by going offshore when they could and leaving their local supplier base to contract will have a continuing impact, as now the dollar is sensible again, there are few suppliers left with the wherewithal to be reliable national suppliers. It is also clear that those who have survived are a pretty resilient bunch, and are disinclined to replace their eggs back in a basket they cannot control.
Housebrands.
Coupled with the carnage of the high $A, the retailers strategic decision to rationalise proprietary SKU’s and replace them with tiers of housebrands to capture the proprietary margin has further led to the rout of the mid sized suppliers. Those left who might be inclined to chance their arm are generally not large enough, and lack the sophistication to manage a business relationship with a major retailer, but some will probably go broke trying.
Margins.
Many FMCG suppliers lose money on most sales to supermarkets. The negotiating power of the retailers, resulting trading terms and promotional guarantees that enable retailers to never pay beyond the discounted price, while restraining top line price increases to compensate has led to the situation where only a madman or the financially illiterate would stake their house on success in FMCG.
Innovation avoidance.
Markets evolve with innovation, but the barriers against success are so large that risk avoidance is the priority. Suppliers trumpet a new pack colour scheme as an “innovation”, and retailers get serious by asking the few second tier suppliers left to copy the proprietary market leader for yet another housebrand “innovation” . Retailers think they are good at innovation, but the experience from around the world as well as locally is to the contrary.
Promotion as marketing.
Continual price promotion only erodes the value of a brand, but brand building is a long term proposition, while staying on shelf is an immediate priority. Guess which wins, and we are rapidly approaching a brandless future beyond the few global mega brands that have the grunt to stay on shelf while spending with consumers to brand-build. Marketing budgets have been consumed by promotion spend. We have a generation of marketing people who have never experienced or even seen real marketing in FMCG.
Wholesale death.
Metcash as pretty much the last man standing is being squeezed by overheads and competing access to consumers outside the major chain supermarkets. Their recent financial results demonstrate the challenge of being the middleman in an environment where it is increasingly easy, and there is increasing motivation to go around the middleman. They seem to be trying with IGA, and with some success, but the local positioning of IGA mitigates against the mass merchandise wholesale business model they operate. Nevertheless, I do see IIGA as a potential bright spot for smaller suppliers who are unwilling or unable to service Woolies and Coles.
Opportunity?
Amongst the doom and gloom, I see several bright points of opportunity.
- While the traditional marketing strategies no longer work, it remain a fact that it is consumers who actually put their hands in their pockets to buy something. Retailers are just a choke point in the system exercising control, and the emergence of digital marketing offers small businesses the opportunity to engage and motivate their consumers to ignore the predations of retailers and express their purchase preferences with their money.
- The shortage of retailer suppliers may lead to a loosening of the noose around those remaining, and open opportunities for them to focus on a niche to deliver a product offer that the retailers do want, but that is hard to copy effectively. Combined with digital marketing, there are opportunities to engage with consumers in ways not dominated by price promotion and generic substitution.
- Local suppliers with a following in a region do have an opportunity to build a business. Coles have been playing with this for a while, and it does work, although the model of local supply does not sit very comfortably alongside the national supplier mentality that exists. For retailers to really get behind this opportunity to nurture “local” they will have to wear an increase in transaction costs, as well as make exceptions to their trading patterns. The big blokes may not, but there are real opportunities in the independents and non chain retail segments.
- Niche retailing will boom, and suppliers have the opportunity to participate. Harris Farm in Sydney continues to rise and rise, and even Thomas Dux, owned by Woolworths but operated largely separately are harbingers of the future. Consumers are increasingly engaged in their retail food shopping, they want their concerns and individual tastes to be met, and that cannot happen in a mass retail outlet focussing on discounting and housebrands.
I am sure there are thoughts I have missed, and would welcome feedback on them as well as comment on those above.
May 29, 2015 | Branding, Marketing, Small business
Build to last
“Brand” is a widely misused and misunderstood term, often referring to a whole range of devices, symbols and expressions that are no more than single elements of the whole.
Building a brand in the digital age of speed, idea cloning and ubiquitous communication is a real challenge, but those who get it right, win big time.
Just look at Apple. When Steve Jobs came back, it was just about broke, now it is one of the largest, and most successful corporations the world has ever seen.
Do you need any more evidence that branding in the digital age works?
While Apple is not the corner store, the foundations of Apple can be applied to every brand, and every business, from the corner store right up to Apple, whose retailing operations in the Apple stores are setting new benchmarks for retail performance.
1. Start inside. No brand can exist in isolation of the internal values and culture of the business they represent. No amount of smart advertising and slick promotion can substitute for great customer experience and value generation, which starts inside.
2. Seduce, don’t sell. Today’s consumers are smart, advertising sensitive and cynical, they need to be seduced by the superior value your brand represents, the experience it delivers. Purchase decisions are not always rational, and when a successful brand is involved in the choice, the equation usually does not have much weight on the price component of the value equation.
3. Lead, don’t follow. Brands have the capacity to lead consumers towards a place they have not been before, or not considered, as they create new value propositions. They look for trends that have the potential to crash into each other at some point, and change behaviour, and then see them before anyone else. Then they build an offer at the point of intersection, often creating the disruption themselves. The great ice hockey player Wayne Gretsky said he did not skate to the puck, he skated to where the puck would be. Successful brands do the same thing, lead, they certainly do not follow or react fads and short term “opportunities”.
4. Sweat the small stuff. Every potential touch point a customer may have at some point with a brand is an opportunity to enhance the brand, or add to the depreciation. Jobs’ fanatical dedication to making even the things no consumer was ever likely to see perfect is legend, but provided a platform for consumers belief that Apple was simply “better”
5. Commitment and focus. Brands that succeed do so because over a considerable period that stay focused on their core “Why” as Simon Sinek would put it. They do not succumb to corporate politics, marketing “short-termism”, and distractions from the market, they hunker down for the long term and deliver what the brand stands for at every opportunity.
6. Broad appeal. Really successful brands have a set of values that cross normal product category lines, and they are able to deliver in differing categories. They are able to accommodate shifts in consumer behaviour because they are not defined by their product attributes, but by their values and relationships with customers.
7. Relish and learn from competition. Marketplaces are demanding places, and only the best survive and prosper. Watching the steps and missteps of competitors makes brands stronger, and when a strong brand has strong competition, they both get better. That is the nature of competition.
8. Design is crucial. A well designed and executed product, and peripheral material like adverting, packaging, and look and feel of the product itself can deliver a unique message to consumers about the values that their purchase choice is delivering to them. Unmistakable, and remarkable are terms that every brand owner should chase for their offering.
9. Defy conventional wisdom. Unless a brand is distinctive, memorable and creates value, it will go unnoticed, and the best way to be noticed is to defy conventional wisdom. Do not do what everyone else is doing, find a way to add value by being different.
10. Communicate facts that resonate. Today’s smart consumers are less likely to be seduced by flimsy claims their parents accepted, they want solid information, facts that are relevant to them on which to make what they see as rational purchase decisions. They recognise preferences are no longer formed by fancy and extensive advertising, but by the realities that their target customers believe.
11. Design for people. Successful brands are never for everyone, their do not squander scarce resources trying to be so. In contrast, the design the brand experience is designed for the specific people who are most likely to be their loyal and lifelong customers.
A brand is more than a collection of attributes and deliverables, it is a long term strategic platform for growth and profitability. Why would you not invest in that?
