A friend recent sent me this post from Gawker, thanks Bruce! In the post they poke fun at the rationale (download) provided by the agency, Arnell Group, on the multimillion dollar logo refresh. Personally, I want to look for the positive in what they created, but this document does not do them justice. What do you think? Please comment.
Posted at The Letter
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This is the fifth in a series of short posts related to The CMO Agenda research. Informed by recent CMO conversations and CMG Partners‘ collective experience helping top marketers develop marketing strategy, we have compiled a list of seven ideas or jump starters for further conversation. These are meant to spark discussion, ideas, and action as we all enter a difficult 2009.
Many industries and sectors have seen new growth opportunities shift from products to services. For example, take the classic case of IBM and the switch from product to services, which is cited many times over as what saved the company.
“Experience” might be next frontier as customer service is now becoming a qualifier for purchase decisions versus an order winner. Differentiating on an experience could range from engaging all the senses in industries like travel and leisure to providing simple surprise and delight moments in less experiential industries like technology or manufacturing. The Experience Economy by B. Joseph Pine and James H. Gilmore is a source for much more to think about along these lines.
Recently, I worked with a luxury travel company on defining a new set of products for the high net worth baby boomer market. Through focus groups we learned that boomers were craving experiences. The example that sticks out most was a person stating: “I want to be guided by a well know chef through the Moroccan spice market, hand select ingredients for dinner, then participate in the cooking process — culminating in the meal itself.” Oh.. and research shows that they are willing to pay through the nose to get this!
For a more grounded example…
Not too long ago, I opened a college savings/investment account for my newborn daughter. I picked Scottrade because I had previously opened a brokerage account and was satisfied. Within 4 hours of applying for an account online, the local branch office, one mile away, called to make sure everything went as planned and to see that any questions I may have had were answered. It was a simple yet effective point of differentiation, and I loved it.
Whether meandering through a spice market or simply calling your customers to make sure they had a good experience, marketers need to think beyond the widget or service offering of today. How will your company or industry take advantage of this opportunity to win or retain customers with a unique experience?
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Recently, I have been speaking to lead marketers about growth — how they define it and what they are doing to achieve it. Through 13 interviews, not one lead marketer has mentioned pricing as a way to increase revenue or profits. Is price no longer a marketing function in corporations?
According to a McKinsey study, a 1% increase in realized price delivers the greatest improvement – a healthy 10% increase in operating profits. This is exactly why marketers need to be thinking about pricing strategies and price management disciplines. As an example, one industry that is ripe for a price increase is the aftermarket auto parts business like Carquest and Autozone. With sales of new cars at all time lows, people are trying to extend the life of the car they have. I recently spent $95 dollars to replace the battery on my car and would have easily paid another $5. It is these types of small increases that drop all of that incremental $5 to the bottom line.
Other price strategies exists, such as bundling or understanding “basket of goods”. When my wife and I go into Target we can not, for some reason, leave without spending ~$50. That is no accident. Are they the cheapest on everything? No, but we continue to pay because my wife believes certain categories of products are price competitively and we just can’t help ourselves buying other products due to convenience.
The Bottom Line:
Price is a big lever! Learn how to employ it and manage it. For further justification in how this works even in a down market please read my friend Sid’s post.
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This is the third in a series of short posts related to The CMO Agenda research. Informed by recent CMO conversations and CMG Partners‘ collective experience helping top marketers develop marketing strategy, we have compiled a list of seven ideas or jump starters for further conversation. These are meant to spark discussion, ideas, and action as we all enter a difficult 2009.
For many companies, innovation means creating a new product, but this is only one of many potential growth drivers. As a lead marketer, your job is to get close to your customers and find other ways to innovate and deliver value – through service, new methods of distribution or new avenues of consumption.
How can you achieve this level of innovation?
A consistent and constant review of your business model and practices can reveal many new opportunities. In other organizations, culture is the driving force which allows for employees to surface new ideas. I recently heard from Jeffrey Phillips, VP of Sales and Marketing for OVO and author of Make us more Innovative. Jeffrey focuses primarily on innovation processes necessary to build a sustainable innovation capability.
Some examples of innovation:
A recent example of a innovative concept I heard was at an HVAC equipment manufacturer. The company leadership decided that they are in the “refrigerated air” business vs. the air conditioner product business. This shift is thinking has many different implications from R&D to value delivered. One idea for commercializing this concept is to sell the service of refrigerated air like a utility. This would increase the number of touchpoints with customers and involves a deeper understanding your customers’ businesses to deliver on this new business model. While this is an innovative idea, it has not been commercialized yet which should be the yardstick for actual innovation.
You need creativity and invention, but until you can connect that creativity to the customer in the form of a product or a service that meaningfully changes their lives, I would argue you don’t yet have innovation. – A.G. Lafley, CEO of P&G in a recent BusinessWeek Interview
Another example that has been commercialized and can be seen in a grocery store near you — Red Box. Red Box has redefined the video store rental model and all for $1 per day per movie. (Disclaimer: I use and love Red Box.) Red Box has a great value proposition that makes it difficult for the troubled Blockbuster to compete and is now in the sights of the CEO at Netflix as he states they are the chief rival now.
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When we asked leading marketers about their roles and priorities during our recent CMO Agenda study, we heard a lot of commentary on the need to step up and drive major change inside their organizations. One CMO of a mid-sized CPG summed up these responses perfectly by describing his main priorities as “defining marketing as a verb rather than a noun” and “taking proactive leadership” that allows the brand and its main steward, the CMO, to be at the center of efforts.
Read more on the idea of how to make marketing a verb within your organization in our article “Marketing: Noun or Verb?” recently published on MediaPost’s Marketing Daily Commentary.
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This is the second in a series of short posts related to The CMO Agenda research. Informed by recent CMO conversations and CMG Partners‘ collective experience helping top marketers develop marketing strategy, we have compiled a list of seven ideas or jump starters for further conversation. These are meant to spark discussion, ideas, and action as we all enter a difficult 2009.
True differentiation is increasingly hard with faster moving markets and better-educated shoppers. This means the task of constantly exploring whether your products and services stand out in the mind of the consumer is critical.
How will you differentiate for the long-term?
Forecasting the “death of the American Brand” as one CMO said, forces you to think about the private label explosion and house brand strength by the likes of Target and big chains. These house brands are successful because very little separates them from the old standards.
This trend is happening in everything from CPG to Computers to Insurance. Dell rode the wave as it commoditized the PC market, which now tries to find a sure footing again. Even service markets like insurance are seeing this trend as GEICO and Progressive lead the charge to commoditize auto insurance and drive down prices — even large cost-ridden competitors are following them in this practice.
In this tough economic market, for many the first reaction is to discount or attempt to push value and rationale messaging, but marketers need to understand the long-term impact. It is time to reassess the market and understand current strategic impacts to make decisions and trade-offs on how your company can differentiate in a unique way.
Mirror post at cmgpartners.com/blog
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This is the first in a series of short posts related to The CMO Agenda research. Informed by recent CMO conversations and CMG Partners‘ collective experience helping top marketers develop marketing strategy, we have compiled a list of seven ideas or jump starters for further conversation. These are meant to spark discussion, ideas, and action as we all enter a difficult 2009.
As one CMO I recently spoke with said, “We should define marketing as a verb rather than a noun. We need to be more proactive.”
Marketing should be a transformational change agent
Companies looking to grow are often in need of a new way to look at their business and a new vision to work toward. If your title is CMO, the job of creating this vision and pushing the organization to achieve it falls on you. More than any other function, CEO’s should look to marketing to lead the charge for change.
Why is marketing “right” for this?
Marketing is the most cross functional part of many organizations due to the customer orientation that puts them in contact with engineering to customer service. Would you really want IT to lead your customer centricity effort?
Marketers by definition should be driving better insight, understanding and motivating desired behaviors inside and outside the enterprise. Marketing should be driving the organization to capture value.
Now might be the perfect time to ask yourself whether you’re shaking things up enough.
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A very thought provoking presentation by
With colleagues at CMG Partners, I have been working on an exciting CMO Agenda research effort and are ready to release the finding to the public on March 17th. Register to receive the free detailed report.
About the research:
What is the “right” role of the chief marketing officer (CMO) and by extension, marketing, within an organization? Should marketing have a seat at the executive table? Should the CMO lead or follow in the pursuit of strategic initiatives? Do the answers to these questions vary depending on industry, company size and type, etc.? How has marketing changed over the last 10 years? And what will the next 10 years bring?
In talking with more than 30 CMOs and lead marketers from mid-sized organizations to Fortune 500 companies across a variety of industries, we found commonalities in practice and differing perspectives on the role marketing can and should play within the organization. Some of the most innovative and cutting edge marketers we spoke with articulated the lead marketing position as a transformative role, working as both a team member and an agent of change within the c-suite.
Marketers openly spoke about their current priorities and critical challenges, and provided candid commentary on how they were approaching each. One of the most thought provoking aspects of our research was a discussion on the evolution of marketing. By capturing thoughts on the swinging pendulum between the art and science of marketing we were able to portray an interesting view on past and future practices.
Register to receive the free detailed report.
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Just received an email from Hilton that states they have launched a new life style brand – Denizen Hotels.
Below is an excerpt from the email announcement:
Born modern, with global appeal and a local accent
Denizen Hotels will become a cultural epicentre at each of its destinations, cultivating community within its walls. Eclectic, social and humbly authentic, each property within the brand will be smart in design, cultural in character and sensitive in service delivery. Developed as an international intersection of business and pleasure, Denizen Hotels will redefine how guests stay and play. With innovative check-in technologies and in-room comfort controlled at the touch of a button, Denizen Hotels destinations will harness the best and brightest design and technology to provide a seamless guest experience for the modern traveler.
Denizen Hotels and resorts will range from unique, select boutique experiences to larger destination resorts, creating a unified yet eclectic brand for the global traveller. Active development negotiations are currently underway for resorts and destinations in key cities throughout the globe; including, but not limited to Abu Dhabi, Austin, Beverly Hills (California), Buenos Aires, Cancun, Hollywood (California), Istanbul, Jerusalem, Las Vegas, London, Los Cabos, Miami, Montreal, Mumbai, New York City, Panama City and Washington D.C.
To become a Denizen, visit denizenhotels.com
[Caution: the Denizen website is painful to navigate and slow]
The Bottom Line:
I am an advocate for new product launches even in a down market, but have a hard time understanding how this is a good idea. The concept on the surface has legs based on my experience working in the travel industry. This is definitely a wait and see…
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