Tag Archives: marketing

The big thing we forget to measure

RISKIn our market research reports we generally make a concerted stab at the idea that our data is both precise and reliable. We gleefully report the sample size,  and we pinch our fingers together as we cite the maximum margin of error – which in many surveys is plus, or minus, 3.1%. Talk about pinpoint accuracy!

Yet we blithely ignore the fact that our clients work in a fuzzy universe where things go right, or horribly wrong. If you were the brand or marketing manager for Malaysian Airlines this year, I really wonder if your standard market research measures – brand awareness, consideration, advertising awareness etcetera – would have anything remotely to do with the fact that you have lost, very tragically, two airliners within the space of three months. Risk happens. Regardless of your marketing investment, passengers aren’t flying MH.

Or if you are the marketing manager for Coca-Cola in your country, do you think honestly that the subtle shifts of brand awareness, ad recall and consideration have as much effect as whether or not this summer proves to be wet and dismal, or an absolute scorcher?

We may not have a crystal ball when it comes to weather forecasting, but we do have decades of accurate climate data.  When I did this exercise a few years ago I gathered 30 years worth of data, popped it into Excel, then used a risk analysis tool to come up with a reasonable distribution curve based on that data. It looked something like the chart above.  Then I could set my temperature parameter – below x° – and based on that, could fairly reasonably calculate that my city had a 20% chance of having a dismal summer. The risk was high enough, I felt, that any marketing manager for any weather sensitive product or service should have a contingency plan in case the clouds rolled over and the temperatures dropped.

Why don’t we do this more often?  Why don’t we build in the various risks that accompany the work of our clients? If we did, then we could better help them to make decisions as circumstances arise.  We consider some risks – what if the competitor achieves greater brand awareness and consideration – yet we treat many of the other risks (weather,  currency or price fluctuations, whether or not supermarkets choose to stock us or otherwise, whether or not some kind of health scare will affect our category, etcetera,) as if these were off-limits and outside our scope.

Though these data are not outside our scope to all. The data may not come in via our surveys, but they are just as relevant.  Going back to the weather example: we did observational research at a local lunch bar, and found that on wet cool days the pattern of drinks consumption was quite different to that on hot sunny days. It wasn’t just a question of volume. On cool days people switched from CSD’s – slightly – towards juices, as well as choc-o-milk type drinks.

So if I was a soft drink marketer, and I had a market research firm supplying me with climate risk data, as well is an idea of how people behave when it is hot, average, or cool – then I might come up with a marketing plan for each of those circumstances. I would go into summer expecting it to be average, but as soon as the long-range weather forecast told me  that indeed the weather is going to be cool – I would think, well, I had a 20% expectation that this would happen. Time to wheel out Plan B. I’d be prepared.

The risk analysis tool that I use is called @Risk and it is frighteningly simple to use. It works as a plug-in to Excel, and takes roughly 10 minutes to learn.  Since using the software, my outlook toward what we do as market researchers has totally changed.

We are not in the survey business. We are in the business of assisting our clients to make informed, evidence-based decisions.

Sometimes the evidence comes from our survey work, bravo! But sometimes the evidence comes from the weather office, or from the war zone of the Ukraine.

Why we need to measure corporate forgivability

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One day before the explosion in 1984, Union Carbide were the friendly guys who brought you the Eveready brand and the Cat with 9 Lives. The NPS would have been pretty good. And pretty useless at measuring the forgivability, or lack of forgivability of the once proud Union Carbide name.

Most organisational and market research measures – the KPIs – are readings of static concepts rather than of processes.

The well trodden NPS measure is a measurement of hope, for example (how many of our customers would recommend us?) but it does little to indicate whether this score might be in danger of imploding.  It is like a measurement of speed, but without the other vital measure on your journey: how full is the tank?  The speedometer and fuel gauge  together measure a process and offer a predictive capability. “At this speed we’re using up too much gas to make it the the destination.”

Here’s another measure: Staff satisfaction. It may be high, it may be low, but the score itself says little of any predictive use.  Thus everybody might be deliriously happy at work (and I hope they are,) but we have no idea from the happiness Index whether they’ll stay happy once the take-over goes through, or when the job cuts are announced.  In fact the measure is pretty useless. It is a thermometer when really it might be more predictive to have some kind of staff barometer which hints at soft or deep changes immediately ahead.

Now brands are measured along similarly useless lines. They’re measured statically but not predictively. We measure the status of the brand, but that gives no feel for whether it is heading toward a cliff; or whether it would survive the fall, even if it did.

When we judge the people around us, we don’t just stop at “he’s a great guy” or “she’s 5 foot 11,” or “she’s a real leader,” we almost always add what I refer to as the moral dimension. “He’s a great guy…BUT I wouldn’t trust him with my money, or “She’s a real leader …AND did you see the way she showed so much respect, even to the people she had to make redundant.”  In other words we don’t just settle for today’s status update, we also tend to throw in the prognosis of how that person will act if they’re put in a conflicted, morally challenging position. We have a “Moral Vocab” with which we assess the likely behaviours of those we judge. Great guy – but morally iffy. Great leader, and puts people first no matter what.

The star term, I reckon, in this Moral Vocabulary is forgivability. It is a useful concept because it accepts that all people will fail at some point, or that all organisations will have their crisis and every brand will have its “New Coke”/”Ford Edsel” moment. They’re bound to. Forgivability measures how people will respond if and when that crisis occurs.

In terms of the resilience of the brand, or the company, the real test is not how you rate when everything goes according the plan – but how quickly you can bounce back if you falter.

To take an obvious case, Tiger Woods was the undisputed star of the golfing world (and still the highest paid athlete in 2013 despite not winning a major tournament.) A typical brand measure, up to the point of his personal and media scandal, would have given him stellar results on, say, an NPS scorecard, or on any other brand index I can think of.

But look how quickly that turned. The moment Woods fell to earth in December 2009 (or should I say, the moment he ran his SUV into a fire hydrant), everything changed. The tank of public goodwill suddenly showed “Less than half full” and sponsors started to walk away. Suddenly the values we valued in this amazing sportsman were reframed and seen in new light. Determination? Or simply arrogance?  Success? Or just runaway greed?  Perfection? Or just a sham facade? Everything that a brand measure might have rated as superb one day was shattered within 24 hours.

Four years later forgiveness has largely occurred. The gallery is generous once more when he makes a great shot, and descriptions of this golfer are laced more with qualifications about his pay check or his climb back to form, than they are about who he has a personal relationship with.

Organisations can rate well in terms of forgivability, or they can rate poorly.  It depends, as it did for Tiger Woods, on the seriousness of the sin and the forgiveability of the sinner.

In my view, Tiger Woods forgivability was undermined by the woeful stage-managed response by his sponsors. Remember those bleak Nike ads where a voice over (supposedly Tiger’s own dad) remonstrated mournfully with our hero? These attempted to package the redemption of Tiger Woods into the space of a 30 second TVC. The ads assumed that with a quick show of humility we’d be swift to forgive the golfing superstar.  Instead the ads gave us evidence that Woods  – he behaved not a man but as a marketing juggernaut – was attempting to media-manage his way out of his mess. It looked merely like insincere spin doctoring. Another sin! And so for weeks the Woods machine kept heaping more fuel onto the fire.

But what of your organisation? It may be sailing along – the speedomoter is reading high, the thermometer reading nice and warm, but what if it made a blunder? It will happen. How will your stakeholders or customers respond?

Apple, that golden child of the business media, has a string of business and product blunders a mile long. But was it forgivable?  Absolutely.  Why? Because the products are cool and because Steve Jobs never really deviated from his vision. The public understood his quest and knew that some failures will litter the pathway to success. No problem.

But post-Jobs, I think the forgivability factor is trending down. Steve’s quest is over and what we perceive is the hulking cash-cow of an organisation he built. The product may be designed in California, but the cash is domiciled wherever the company can avoid tax. Things like that start to reframe Apple not as “one man’s passion” but as just another bloody corporate.  In that light, every new launch looks less like Steve’s marvellous march of innovation, and more like the CFO’s latest plan to sucker the public. You can almost hear Mr Burns from the Simpsons. “A masterstroke Smithers! We’ll do what Microsoft used to do with Windows. Yet our fans will still think we’re the anti-Microsoft!”

Some sins are purely business as normal. Coke really did believe their New Coke formula was a better, more preferred option. They didn’t think things through.

But some sins are simply not forgivable. Union Carbide, that industrial fortress of a company that made Eveready Batteries, and Pesticides and Glad Wrap, was responsible for one of the worst industrial accidents in human history with the Bhopal disaster in India, back in December 1984.

Here was a company that was deliberately trading-off the cost of safety in order to boost profits from its poorly resourced pesticide plant located in a heavily populated area. As a result of an MIC gas explosion an estimated 40,000 individuals were either permanently disabled, maimed, or suffering from serious illness.

That was bad enough. But then after the disaster, Union Carbide tried overtly to avoid culpability or to pay any compensation to the families of the accidents thousands of victims. There was no mea culpa – instead the company fought a legal battle before finally being sued by the Indian Government for US$470 million, 5 years after the disaster. The guts of their defense was was that they weren’t responsible as a company for Bhopal – it was the fault of their employees in India. It was a massive squirm. The head of the company Warren Anderson was never brought to justice in India after the American fled India while on bail, and has since fought extradition from the USA. Today the company no longer owning its flagship brand (Eveready) and is part of the Dow Chemical company who have inherited the mess. In 2010 (25 years after the disaster) eight former executives of Union Carbide India Ltd. were finally found guilty of death by negligence. Dow, themselves burnished by the reputation of their own history with Napalm and Agent Orange are still assisting with the highly toxic Bhopal site cleanup.

Mistakes, blunders and sins can be made by any organisation. But how soon can these organisations recover – how soon can they be forgiven? In a dynamic world researchers need to measure these things. In my next blog I’m going to dissect the elements of forgivability. Get it wrong and your organisation will tread an unnecessarily risky path.

Bieber gets booed – what that teaches us about reputation management.

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Music awards are warm-hearted events where peers congratulate each other – where country singers get applauded by rap artists, and where R&B stars are lauded by punks. It’s one big family. Music is a generous business. Well usually.

Sure, there was the infamous Brit award ceremony when Jarvis Cocker interrupted Michael (this is for the children) Jackson during the late superstar’s speech. Jackson had forgotten that this was a music award ceremony – and not a Saviour of the World ceremony.  But this incident was the excception. By and large musicians are polite.

Not so today when at the Billboard Music Awards pop idol Justin Bieber was booed by a large section of the audience when he went up to accept the Milestone Award.

Booing? Bieber was dumbfounded, and momentarily speechless before he proceeded to tell the audience that all the other publicity in his life (presumably the recent string of bad PR) should not take away from the fact that he is an artist and this is “all about the music.”

He had a point surely. How many in the music industry have a spotless life. When a Chris Brown is  arrested for domestic violence, or an Usher sells out, interrupting his fragrance promotions to be paid a million dollars to perform at a private function for the son of Libya’s ghastly dictator Qaddafi; the music biz tends to look the other way.

So what has Bieber done to upset his fraternity? Surely his recent throwing-up on stage was not the cause. Or the alleged dope smoking. Hello, you’d wipe out the entire industry if that was suddenly a crime. Perhaps what did it was his recent signing of the visitors book at the Ann Frank museum (expressing that had Ann lived, she would surely have been a a Belieber..) surely these things were not especially worthy of booing? 

So just now I searched the reactions in the music press and Hollywood media to see what people were talking about. After all, reputation is in the hands of the people. And this time the people had clearly spoken.

So here it is. This is the crime: the thing that earned so much opprobrium. It was Bieber’s lip synching. Here’s an artist who says its “all about the music” and he’s not even singing. To be honest, few others were actually singing at the awards either – judging by comments – but let’s be honest, if you’re a pop idol, manufactured and permed and wardrobed within an inch of your life, the one thing you need to cling on to is credibility. So far in his career Bieber has been able to claim that for all the fad-ism around his image – a modern day Ricky Nelson – he can still actually sing. 

Only these days he doesn’t.

One of the keys to reputation – a dimension that enables Madonna to sustain an amazingly long showbiz career is authenticity. Gaga has it. Great artists basically all have it. Deep down these people can write and sing – they’ve got the real stuff.

The same goes for great companies and other organisations. They each have a talent and they work hard to hone this. Levis still makes hard wearing denim. John Deere still makes reliable tractors. Coca-Cola had a shot at changing the formula – but quickly learned it needed to stick to being the real thing. Cola flavoured, sugared water maybe – but it doesn’t pretend to be anything else.

Whatever we do, our reputations rely on the same substance: authenticity. Bieber has just been smacked down by his peers. Mate, we won’t respect you unless you get real.

Abercrombie & Fitch – a reputational glitch

abercrombie & fitch marketing glitchSince the 1990s Abercrombie & Fitch has been a fashion brand that has taken the label from failure (it harks back to 1892 but by the 70s had failed as a company,) to gigantic success with an annual turnover measured now in the billions. At the heart of this story has been a fundamental disconnect between the image of the brand – clean-cut, Mid-Western, Joe College values (exemplified by their use of the Carlson twins as models who showed off their flesh more than they did the actual fashion) – and the aggressive multinational fashion company that uses cheap third world labour to manufacture faux nostalgia (college sweatshirts that you might have rescued from your dad’s top drawer) and then peddle this through a lavish chain of upmarket flagship stores.

A&F deliver dreams. They’re not alone in this, far from it, and in many respects they exemplify A+ marketing: tapping into needs and wants and through packaging, price and placement ensuring healthy profits.

But the disconnect comes at a price. Reputational Risk. It is one thing to be a brand that, deep down, offers a perfromance benefit. For some reason I’m thinking of Coleman and camping supplies. That company has been dedicated to delivering products that function, and show little details that users appreciate. A fashion label such as A&F simply delivers image. Its product quality is nothing special, it’s designs are derivative rather than original, it’s fabrics – mostly cotton – offer no USP. But the dreams and packaging and catalogues and image – well, they’ve been the reason for the brand’s success. It sells something that is accessible. You too can be part of the A&F movie. One of the gang.

But it turns out the gang is less inclusive than it has made out in the advertising. The CEO is quoted as saying that he doesn’t want to sell larger sized items because he doesn’t want fat people wearing his brand. He doesn’t want them in his stores. Instead of being genial Joe College, Abercrombie & Fitch is, deep down, the spoilt snob.

Suddenly the gap between image and reality is made, in just one quote from the CEO, as plain as day. Here’s what happend. I’m taking this straight from The Drum.

An LA-based writer is looking to give Abercrombie & Fitch a ‘brand readjustment’ by asking viewers to donate their A&F clothing to their local homeless shelter, after the CEO of the company suggested he didn’t want ‘unattractive people’ or people over a certain size shopping there.

Greg Karber created a YouTube video suggesting that people donate clothes, and send pictures of them doing so to #FitchTheHomeless.

The video went live on Monday and has so far almost received a million views.

In it, Karber insists ‘Together, we can remake the A&F brand.’

The video caught like wildfire – with more than a million “likes” on Facebook within 48 hours. With the story being widely picked-up in the media this week the twittersphere has become a pile-on of latent A&F hate. The story in itself has resonance, but I suspect the speed at which this reputational wildfire has spread comes from the degree to which the brand has already built up enmity within the public.

  • Everyone loves the A&Fitch bashing video. The brand is for 14 yr old douche bags anyways, it doesn’t need a homeless ppl “readjustment”
  • Abercrombie & Fitch would rather burn the clothes that it doesn’t need rather than give it to charities… Wow.. Um… Ya…
  • I’ve been hating on Abercrombie & Fitch for years, just because their clothes are ugly, y’all slow

There are at least 4 solid reputation management lessons to be drawn from the story so far.

  1. The wider the gap between your image and your reality, the bigger the reputation risk.
  2. Over time every little misstep or poor judgement will aggregate to form a parallel narrative to your official version. Like debris in a forest, it will prove flammable in certain conditions.
  3. Every once in a while it pays to cut some clean firebreaks through bold, well intentioned actions that are both credible and meaningful.
  4. You may stand FOR something, and FOR your target market. But don’t confuse that with the making statements that put down others. Remember, they are legion and they are armed with social media.

For his own part, film maker Greg Karber may face a firestorm of his own. I’m predicting he will on the basis that he has also ignored three of the four rules above. He has not validated his expertise on the subject of ethics – and judging by his whining, even sarcastic tone in the video – he seems more personally aggrieved than truly concerned with business ethics. I might be wrong there, but he leaves room for doubt.

But already there has been growing criticism of his use of homeless people as mere props in his production. Never once does he seek their opinion, or lend them much dignity either. His message: since A&F hates the uncool – I’ll use the uncool to highlight the fact. In so doing he’s just as guilty of snobbery as is his target.

There’s a fifth lesson in reputation management that karber should heed. Most reputational damage is self inflicted.

First we take the Poppy – then we take Berlin

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A few hours ago I wrote a blog criticising Nivea for appropriating the ANZAC Poppy symbol for their own marketing message on the FB page.  Their (Singapore?) office withdrew the posting following some well deserved public protest but I notice in the Poppy’s place is the image above: Their message – “Happy Earth Day!”

Well I guess it is 67 years or so since Coca-Cola appropriated Christmas (and rebranded Santa in the now familiar red suit – it used to be brown) and I guess it is 40 years or more since Coke hijacked world peace by Teaching The Whole World to Sing – so perhaps I shouldn’t be shocked any more when a hand creme company concertedly rebrands two things I value (in my own way as a citizen) dearly. First they took the Poppy, now they take…the entire planet!

To explain that this might be wrong would be to engage, what I suspect are young market-economy indoctrinated marketers who have never attended any ethics courses along their academic pathway. Neither did I for that matter but in my lifetime I’ve sensed a deep erosion – a melting of once-permanent ethical polar ice – around what is, and what is not commercial property.

A good starting point for marketers is the book by Harvard ethics lecturer Michael Sandel. In it he cites often outrageous transgressions of public and personal freedoms and beliefs by the free market – then he discusses not only why there is some moral repugnance around these facets of commercial life, but why this marketing-society-led creep is occurring.

His message – and Nivea’s team could do well by reading it – is that brands are not people, and that when brands appropriate or subvert human values, then they cheapen those values and erode the things we hold dear.

In a few days I’ll post a review of the book so that other marketers can avoid the pathway that Nivea seem so keen to take.  I hear the signage rights to the Universe are up for grabs.