The most dangerous assumption in relationship marketing:

Most consumers are open to entering a relationship with my brand.

They aren’t.

There’s a growing body of evidence suggesting that, at most, somewhere between 20% and 30% of consumers are willing to engage in a “relationship” with a brand.   The vast majority of consumers simply aren’t wired to enter into brand relationships.

When we asked 7,000 consumers via a global survey earlier this year whether they have a relationship with any brands, only 23% said yes.  The rest said “no”, and when we gave them an opportunity to elaborate on their response in a free-text field, we got lots of comments like “It’s just a brand, not a member of my family.” Read More »

One of marketers’ top priorities next year is digital integration, or – more specifically – adapting to the increasingly central role of digital in the marketing mix.  In a recent MLC poll, B2C marketers rated this their second highest priority.

Despite several years of slowly shifting mindsets, Digital Marketing is too often still treated as its own stand-alone function, separate from Promotions, PR, Direct Marketing etc.  It should, by contrast, be treated as a part of all marcomm efforts.  Here are a few reasons why: Read More »

Go ahead, curse me for getting the song stuck in your head. But there’s something important here that I think many marketers don’t realize or understand, and that’s that social media marketing may in fact be weakening your branding initiatives.

Typically, we hear the refrain that channel proliferation and the more information-dense lives of consumers offers companies an opportunity to reinforce – not dilute – their brands. Consumers spend greater chunks of their life connected to various information platforms and, at least so the story goes, this offers brands three things: more screen real estate to do branding, better data about which consumers to target with which branding initiatives, and more “dense”, interactive ways to experience the brand.

So, what could go wrong? One clue comes from a recent paper by Harvard Business School professor Michael Luca, who examined the effect that Yelp has on the restaurant market in Washington State. First, the good news: he found that a one-star bump in a restaurant’s Yelp rating led to a significant rise in revenue (between 5-9%). The bad news: he found that that effect did not apply to chain restaurants, and that as Yelp usage has proliferated, the market share for chain restaurants has declined.

What’s driving this? My theory is that the informational power of a strong brand is declining. Look at these two signs: Read More »

When I was young, my parents always told me, “Don’t speak unless you can improve silence.”  That can be quite the challenge, and to this day, I’m still not sure all my words are better said than unsaid.  But when speaking meant possibly worsening the silence, I knew to keep my mouth shut.  This rule-of-thumb always comes to mind when I’m giving word-of-mouth recommendations.

As many marketers know, word of mouth is one of the most powerful consumer marketing tools, and smart marketers are learning to harness, amplify, and improve upon this medium.  Typical approaches to boosting word of mouth focus on identifying and engaging the brand’s biggest fans (or – one better – the brand’s most networked and credible fans).   To engage these fans, brands often offer discounts, exclusive information, or even live visits to the brand’s HQ etc.  The aim of all these efforts is to motivate fans to speak – and they’re often successful.

However, two things are often missing: Read More »

Thanksgiving is just around the corner. And if you’re the chef, you know not to overstuff your turkey unless you want to risk a bird explosion in the oven. Ask Rachael Ray or Martha Stewart if you don’t believe me.

I know, it’s tempting to put in just a little bit more deliciousness. If we have it, why not use it?  Be it the extra stuffing or the bunch of variables that haven’t made it into your very comprehensive marketing analysis. Maybe it’s the regret at seeing the extras “go to waste”; maybe it’s the urge to supersize in response to complexity and diminished control.  Cooking up an insightful model from a mountain of data can be just as stressful as cooking a banquet. Read More »

Black Friday may need a name-change – to Black Thursday.

Many big-box retailers this year are opening their stores on Thanksgiving Day itself to kick off the traditional after-turkey shopping rush.  Toys R Us is opening at 9 p.m., with Wal-Mart following soon after at 10 p.m.  Best Buy, Kohls, and Target are all opening at midnight.

The benefit of opening early seems clear: retailers hope that shoppers will head to their stores first and complete all of their holiday shopping in one fell swoop.  Also, opening on the night of Thanksgiving may attract shoppers who are bored after the turkey’s been eaten, the dishes have been washed, and the kids have been put to bed; an early opening may also attract those who love sleeping in (but are still awake at 9 or 10 at night).

And the demand may be there.  Brick-and-mortar retailers have increasingly more competition.  Amazon is offering daily deals leading up to Black Friday, and Amazon offers a lot more convenience than the hassle of dealing with Black Friday’s crowds, traffic, and sleep-deprivation.  In addition, consumers are retaining many of their recessionary behaviors, so they are more likely to hunt for the best deal.

This doesn’t mean that it is a good idea all around, though.  The early openings mean that employees have less time to spend with their families on Thanksgiving Day.  This early start to their Black Friday shifts means that many will have to duck out of Thanksgiving dinners early to sleep and prepare for work.

In a lot of ways, it’s a reflection on just how miserable the consumer economy in the US might be. Retailers know that they’re alienating their staffs by opening earlier and earlier each year, but it’s part of the marketing strategy to capture a greater percentage of consumer wallets. Retailers used to be able to do that by lowering prices, offering better products – that sort of thing – but as consumers fail to respond to those kinds of stimuli, stores are competing in other areas – like opening hours – instead.

Employees aren’t letting their bosses get off easy: A Target employee has launched an online petition to protest Target’s hours, and it has generated over 180,000 signatures as of Nov. 18.  A quick look through the comments suggests that consumers (as well as the employees) think Target has gone too far.  Many argue that Thanksgiving is a holiday that should be spent with family, and shopping should wait until about dawn on Black Friday.

Do you think consumers will relish shopping on Thanksgiving and adopt it as a new holiday tradition?  Or do you expect stores to be empty until the wee hours of Black Friday morning? Share your thoughts in the comment section below.

This might sound like a sort of pedantic question, but it’s one worth asking: why do we use social media? We know that people do use it, and we have a general idea of what they’re doing during that time, but what do they describe as the value from the time they spend socially networking?

Pew Research recently took the time to ask people that question directly, and here’s what they found:

Read More »

A few years ago, marketing pundits were predicting the slow death of brick-and-mortar. After all, when you can buy anything you need on Amazon, what’s the point of braving the crowds for lower-value goods? But as mobile ascends in popularity, retailers are finding that the optimal experience for consumers involves the touch-and-feel experience of the brick-and-mortar store, combined with the high information density of the computer – and they’re optimizing their customer-facing technology efforts to take advantage.

This year, a number of brands released or updated their apps to better fit into the brick-and-mortar retail experience. Here are some of our favorites: Read More »

Even with deep customer understanding, companies still need to use creativity to look beyond what consumers say to create the best new products.  One often-told example of this is the iPod.  In the late ’90s, most consumers – anchored by their existing CD collections and players – thought they wanted a better Discman.  Thankfully for the hundreds of millions of iPod users worldwide, Apple had a better idea.  They realized that consumers, while they may have said that they just wanted a better Discman, would actually value a smaller device that can hold more music.  Because they coupled creativity with deep consumer knowledge, Apple was able to revolutionize the music industry through its creation of the iPod.

Just like Apple, automotive dealer software and services provider Reynolds and Reynolds has used more customer-focused insight generation to improve their new product development.  They realized that their marketing research practices had two major weaknesses: the current insights were anchored to existing products, and they were ambiguous and open to interpretation.  To get solve the problem of new ideas being limited by current offerings, Reynolds and Reynolds developed a better customer understanding of their true needs by identifying the results their customers are seeking to achieve (irrespective of existing products and services).  This reframing of insights from product- to job-based allowed Reynolds and Reynolds to figure out how it should best allocate its resources to meet their target’s needs; this new process increased the number of solutions-worthy insights seven-fold.  MLC members, learn more about how Reynolds and Reynolds shifted to this results-based insight generation and tackled the problem of ambiguous insights here. Read More »

It’s a refrain we hear often from B2C marketers: their customers are just not engaged enough with the brand. “If only we could cook up the perfect e-mail subject line – that would really wow them!” or “What channel is our demographic flocking to these days? Maybe if we’re the first brand there, that’ll really drive sales!” are how these laments typically go.

But take a step back. Marketers have been on the “engagement” treadmill for probably close to 10 years now, ever since e-mail became a viable commercial channel. Yes, in the interim, we’ve gotten a good deal closer to our consumers – in some cases, giving them a seamless, cross-channel experience both in marketing communications and customer service. Employing internet marketing and mobile marketing, brands can now reach consumers via  e-mail, SMS, Facebook, and Twitter. And the cost of hitting those touchpoints is much, much lower than in the old-media world of radio, televisions, and newspapers. But at what cost?

This year, MLC’s key B2C research effort focused on how customers have responded to the barrage of branded information marketers are throwing at them, and the results aren’t pretty: rather than feeling closer to brands, and rather than feeling more sure about their shopping decisions, they’re more confused than ever. The barrage of messages and product choice has led to all kinds of indecisive behaviors, such as endemic brand-switching and “decision spirals” in grocery aisles and retail sales floors. Customers still buy, but many make sub-optimal purchases (and, subsequently, aren’t loyal to the brands they buy), and many put off buying because they’re oversaturated with brand information. Read More »