MarketingFree

The sandpile and the avalanche

I was power-buying at Costco recently when I discovered, situated between the tube sock 12-pack display and the bulk yard fertilizer (enough to fertilize a golf course), a brand-new book: The Age of the Unthinkable, by Joshua Cooper Ramo.

Full disclosure:  I haven't finished the book yet, and Ramo seems to have a knack for using a lot of words to not get to the point - but, I find the book intriguing just the same.  And, applicable to Postmarketing.

A central concept that Ramo talks about is the unpredictable nature of sandpiles, as studied by a Danish scientist named Per Bak.  Bak created sandpile after sandpile, by systematically dropping sand one grain at a time, and then observing at what point a grain of sand dropped and set-off a chain-reaction avalanche that caused the whole pile to disintegrate.  His conclusion?  There is no way to predict which grain of sand will cause the avalanche, or the extent of the damage.

For Ramo, this is a useful analogy to the seeming chaos of the current geo-political environment, with terrorists, quasi-nation-states, separatist groups and transnational organizations all vying for power.  Even with all of the intelligence in the world, there is no way to predict the event that might change everything, or the extent to which any single event will alter the future.

Lest I fall victim to not getting to my point quickly, here it is:  the worlds of marketing, social networking, media and technology are being mashed-up in ways that can't be predicted, meaning that the old ways of looking at marketing (like the 4p's) are increasingly irrelevant, and potentially even flawed.  One can no longer predict market acceptance, because the grain of sand that causes an avalanche of adoption can't be predicted.

Postmarketers must be scientists (experimental and analytical) and deconstructionists (of existing methods and assumptions) so that they raise their probability of finding the grain that sets-off a chain reaction of adoption.

Now, I'm going to go finish that book...

Postmarketing: Why Lexus ads make me queezy

This post relates to the Postmarketing presentation.  Check it out.

With all due respect to the quality of Lexus automobiles, Lexus ads now make me queezy.  Do you remember those Holiday ads with the red bow around the Lexus?  Honestly, how many of you have bestowed a $50,000 Christmas present on a loved one (without any twinge of buyer's remorse)?

But since we're all being open with one another here, I didn't begin to feel this way until sometime last summer - when the economy started tanking.  Why?  Because I was used to luxury, and I was used to luxury being marketed to me.  I haven't owned a car without leather seats in years (my Accord even has seat-warmers!).  I expected Ritz Carlton-level service everywhere I went, and whined when I didn't get it.  I looked at a house with 3 garages last year, and justified what I might do with the 3rd bay (didn't buy it - whew!).  This is not because I had some great windfall of cash - rather, it was because we had all come to expect that we can afford (and even deserve) luxury, and we had a seemingly endless windfall of credit to pay for it.  Luxury had been commoditized.

That was last year.  Now, luxury is being returned to its rightful place among people who can afford it (with cash) and, even there, luxury is having a rough go of it.  Luxury is not only expensive again, but it's out of style... said another way, Less is the new More.

The implications for marketers are profound.  How do you market less?  Green marketers have certainly led the way on this, although even green marketing to-date has been "more - and green too!".  I believe the path forward is simple: market genuine value (thanks to Chris Grams and David Burney for blazing this trail at Red Hat).

In order to avoid being irrelevant (or, worse, nauseating), marketers must focus on truthful, straightforward messaging about the actual value of their products & services.  Slathering on generous amounts of luxury positioning was an easy cheat during the boom - but it wreaks of excess & consumption in the postmarketing world.

It would be a luxury for me if you commented on this post - please indulge!

Postmarketing - New principles for a new age

Soapbox time!  I've been thinking a lot about how the dramatic changes in the global economy might affect my job as a marketer, and I have had the privilege to speak to a number of companies about how they are rethinking marketing.  So, I thought I would share my ideas with you via a SlideShare preso.

Please check it out, send it to others who might like it, and rate it.  I would love to hear your comments and feedback here, or in SlideShare.

*Disclaimer:  this is a preso, meant to be presented, so it leaves a bit to the imagination.  I will delve deeper on some of the concepts in the coming days, in blog posts.  Enjoy!

Postmarketing - new principles for the postmarketing age

View more presentations from tbarr. (tags: media social)

Must read: Enough of Too Much

I've been thinking a lot recently about how these drastically different economic conditions are going to change marketing, and I came across this must read:  Productivity:  Enough of Too Much (free registration required - sorry!).  The author, J. Walker Smith, is President of a marketing research company - but, more importantly, has more degrees from UNC than I do (which means he must be right).

Key takeaway:  Less is the new more.

Stay-tuned to marketingfree, as I will be publishing a lot more thoughts on post-meltdown marketing.

Marketing vs. sales is so last year

I came across a biased, uninformed, largely inflammatory (but otherwise a great read!) BNET post today called How Technology Killed Marketing.  While Geoffrey James's description of how the Internet has changed marketing is largely on-point, the conclusion is dead-wrong.

James contends that the ability to track the effectiveness of every lead (closed-loop marketing) has exposed, and therefore killed, marketing.  Sorry Mr. James, but the opposite is true.  The ability to track the effectiveness of every lead ALL THE WAY through to every sales channel and person only make marketing both more effective and more strategic.  Now, good messaging, positioning, creative and programs can be more easily and more quickly distinguished from bad... and good sales channels and sales people can easily be distinguished from bad - based on the right metrics.

At a previous company that I worked for, sales continually pined for "more leads".  But once we had the right closed-loop marketing systems installed and integrated into SF.com, we began to uncover interesting truths, like: the good sales people indeed did need more leads, but the bad (and quiet) ones actually were sitting on leads that good people could have closed; some leads were going into "black holes" because of empty territories, cherry picking, or someone's assumption that "all trade-show leads are bad"; etc.

Armed with the right tools and data, marketers helped sales come up with better lead distribution (including pushing many to the channel), improve programs to improve lead quality, and actually expose under-performing sales resources.  Not exactly what Mr. James had in-mind, I think.

For smart companies, marketing vs. sales is not an issue any more.  As I have often said, marketing is just selling to many, while sales is marketing to one.  The skills might be different, but the goals are algined.  Let's bury the hatchet.

As if being President wasn't enough...

... Advertising Age named Barack Obama "Marketer of the Year" (in truth, they did that before the election, but still!  I'll bet you're angling for person-of-the-year from Time, too.  Leave some scraps for the rest of us, Prez!).  My friends at ReachForce did a nice blog post about it, highlighting the key online marketing tactics.

But digging a little deeper, the folks at Wider Funnel did a nice post about multivariate testing that barackobama.com was using, taking advantage of Google Website Optimizer.  This type of granular, rapid-feedback testing is truly one of the differentiators of online marketing, with one caveat:  it requires statistical significance.  If you don't have enough users to rapidly get answers, you risk making bad decisions.  barackobama.com didn't have the problem.

An easy way to test is by just doing some ad-words campaigns with varied messaging, and then look at click-through rates... but make sure you are seeing enough traffic before you make any judgements.  Even better is to keep tests going long-term, and (assuming you have closed-loop marketing of some kind) look at conversion rates of those leads.  At a minimum, figure out where people are going after the initial click, so that you can make some assumptions about the quality of the visitors.

Help me sell my house

If you haven't heard by now, I'm trying to sell my house.  Luckily, I'm not underwater and I can afford to wait this out (and my heart goes out to those who are in dire situations right now).  For us - we're just ready to move on with our lives in our new city.

Besides the fact that I brilliantly timed my move to coincide with the worst housing market since the Depression, we've done everything by-the-book.  Nice house, established, sought-after neighborhood in a booming town, great school district, no fatal flaws.  We've renovated, painted, and fixed.  If we could pick our house up and move it to Austin, we would.  Lookers have called our house "nice", "great", and even "awesome".  But the sad fact is:  nobody is buying houses right now.

As I've wracked my brain to figure this out, it occurred to me that I am the proud owner of a marketing blog.  Surely I, or my intrepid readers (all 3 of you), can figure this out.  This is simply a marketing problem,  right? 

So, what creative marketing ideas can you come up with to sell my house?  Post your comments on this blog or reply to me on Facebook or Twitter. Let's get those creative juices flowing!

Here's a few early ideas to prime the pump:

- hold an essay contest to win my house, where I charge $100 per entry (problem with this is that it has only worked a couple of times... usually, it's hard to get 5,000 people to enter, so you end-up having to return everybody's money.  Will it work in Raleigh?)

- discover a Virgin Mary image on a crawlspace wall (the Virgin Mary grilled cheese sold on eBay for $28k, so I'm bullish on this idea)

- give away a Prius with my house (going "green" is still the new marketing hotness)

- claim I can see Russia from my house

Your turn!

(And if you really want to help, here's the link to my house listing that you can send to anyone who you think might be interested.  I'm in the mood to make a deal!)

How Wacky Wally weed-whacked his weputation

Marketing lesson of the day:  in the reputation economy, you can run, but you can't hide.

The guy who takes care of my yard has branded himself Wacky Wally (it's actually not Wacky Wally, but it's similar - names have been changed to protect the guilty, in this case).  When you say it, it kind of makes you chuckle and it's easy to remember - probably a pretty good idea for someone who, theoretically, grows his business based on word-of-mouth and a good reputation.

Trouble is - Wacky Wally isn't a very good yard guy.  I would fire him, but my landlord pays for it so I don't really care that much.  I might have just concluded that Wally was just really busy and in-demand, so that's why he lets my yard grow uncontrollably for weeks.  And, if I got frustrated enough and really did fire him, he probably could have talked me into a second chance or, worst case scenario, just lost one small customer.

But that's not how Wally rolls.  Recently, Wally sent out an e-mail to all of his customers to ask them to vote for him in the latest Austin Chronicle Best-of-Austin poll for Best Landscaper, with the subject "LOVE".

Mistake number one was that he didn't BCC everyone, so we all saw the entire e-mail list of his customers (making it easy to Reply-All).  But mistake number two actually happened awhile ago:  Wally provided bad service, and didn't fix it.

Two replies (and only two) came back to the entire list almost immediately:

Reply #1: 

"Are you kidding?  You were the worst experience we ever had regarding yard men!"

Reply #2: 

"Hi Wally,

My puzzlement notwithstanding - if you will do something about those dead plants that you charged me for after your costly and protracted landscaping effort, I will not only vote for you several times but will forget that you did not return my "four" related messages begging you to deal with my plants.

I am not only forgiving, but easily bought off; if you fix my plants - I will vote my ass off!!

Best regards,

-Larry Hiller (name changed)

With LOVE, of course."

Final score:  Angry Customers 2, Wally's reputation 0.

So, in the course of one e-mail, Wally pretty much weed-whacked his entire reputation and pruned his business quite substantially.  Wally, I think you might want to try becoming a xeriscaping expert.

The next hot marketing vowel

I thought about calling this post "Why Obama will win", but, alas, this is a marketing blog, not huffpo. Here's the point: whoever came up with the Obama brand was a Web 2.0, social marketing, visionary genius. And, no, don't tell me it was his parents.

Just imagine the smoke-filled room, where campaign strategists and politicos were sitting around a table looking at various type treatments and logos for Barack (BaROCK, BaROCKY, Baroque, etc), when that lone contrarian voice cut through the noise with, "I think we should go with Obama." Stunning in its simplicity.

If timing is everything, this guy's middle initials are GMT. I mean, who knew that we would have exhausted the e's (e-commerce, e-business, e-mail), blown through the i's (iMac, iPod, iPhone), and would be standing at the precipice of the next great marketing vowel movement, precisely at the peak of an election year? Brilliance.

You heard it here first: an Obama win will usher-in a renaissance of O-based branding and marketing, the likes of which we have never seen.

(Sorry red-state marketers: I have a ton of respect for Senator McCain, but "mc" as a pre-fix has been done, and I don't think you want to go there.)

Early adopters love free stuff

A colleague pointed out an interesting conversation by Savio Rodrigues and Matt Asay about marketing, sales models and growth in open source companies.  Since I work for the referenced company, I'll steer clear of specific responses.  But I think Savio is on to something when he talks about the growth hurdles.

Honestly, I don't think start-up OSS sales & marketing challenges are much different than any start-up's challenges.  The issues around inside sales vs. outside sales have much more to do with cost-to-serve and deal size... OSS software is generally a fraction of the cost of proprietary alternatives, so your deals are smaller compared to your proprietary competitors.  You just don't have the luxury to send out expensive direct sales people and hope to get to profitability quickly.

The subscription model adds to this challenge.  When you sell proprietary software, you generally book all of that revenue now.  When you sell a subscription (the predominant OSS model, thanks to RH), you recognize the revenue over the course of the subscription.  While it's a great business model for cashflow and building predictable future revenue, it means your expense threshold is much lower than a license company - even though you still have to *book* the same amount of business each quarter.  The effects are particularly throttling early in the ramp of the business.

So, start-up open source companies necessarily need low-cost, high-impact marketing tactics.  And, by golly, providing awesome software to download for free is a great tactic - it drives a lot of web traffic, builds your brand, helps you get your early adopters, and quickly builds a community of advocates that might buy your value-added services in the future.  But the free download tactic is less relevant to the challenges of a mid-sized company: converting the early majority (especially big companies), upselling existing customers, expanding your product portfolio, and doing it all profitably (and without early adopter discounts).  That's when you begin to think seriously about your channel strategy and business plan, and start to figure out that you aren't all that much different than other software companies - except for the crucial fact that customers inherently want the value you're selling, which is a great place to be.