Friday, January 30, 2009

Advantages of the Economic Crisis

It’s true that the job losses are mounting every day, and I’m compassionate for the individual tragedies that this can engender. Looked at one way, we are sliding down a bottomless pit and most people are only jamming on the brakes, hoping they don’t slide in too.

That’s the public side of this crisis, but it’s not the underbelly. The crisis has given new impetus to creative innovation - new products, services and business models. The bulk of these have yet to gain an audience of more than 100, but several are surely the juggernauts of the next decades.

I’ve had the privilege to talk to five start-ups in the last few days. Each one has excellent possibilities. They are coming to market at just the right time. The traditional players, who would typically “muscle out” competition of superior products, are now unable to compete from the same position of strength. The market is looking for better and cheaper products and services. Even though the crisis has produced risk-averse characteristics in several executives, those who are looking forward, are more than willing to streamline, improve and innovate.

I believe that this is the time for the entrepreneur. I’m excited at the potential out there. The world is flattening and is really our oyster. Let’s see what successes are soon birthed to take us into the next generation of business and profit.

Thursday, January 22, 2009

Is Twitter Twittish?

Twitter is all the rage for many social networkers. For the rest, it is often viewed as a despised waste of time. Who’s right? Is Twitter the smart way forward or are you a twit for using it? just published an article on the top 40 Company Twitters. It also comes to some interesting conclusions.

First, the top Twitters: They come from a variety of industries. Representing cars is Adam Denison from Chevrolet. He tweets “because he wants to be part of the online dialogue around Chevrolet.” Ford, GM and Honda also have dedicated Tweeters. Travel is headed by Jet Blue and their Tweeter - Morgan Johnston. Other industries with companies that are serious about Tweeting include the leisure industry, sports, accounting, warehouse/retail and fast-food outlets. Only one non-profit is listed - the Red Cross.

What do they think about the value of Twitter? Obviously they value it, or they would not dedicate personnel to this endeavor. Lon Cohen at Mashable contends Brands belong on Twitter because Twitter is opt-in, Twitter is the new phone company and because Twitter enables Brands to develop real personality to a greater extent.

However, the final questions for this short blog are these: To what extent are customers retained and to what extent are new customers won as a result of Twitter? Are Tweeting marketers the engine that drives the demand, or is Twitter really gaining mainstream traction? If it is increasing its user base through natural interest in Twitter’s communication form, as opposed solely to marketers’ hype, then greater thought should be given to its international and multilingual use. Twitter’s communication is short, which is advantageous for those in communities with less connectivity. It could also enable those who are remote to feel part of the main debate. Perhaps Twitter could end up being a great “New Market Detective”.

Thursday, January 15, 2009

Offshore or Onshore?

The economic crisis has spawned a new dilemma seemingly at odds with the “flattening of the world”. Flattening is a term often used nowadays to emphasize the strength of contact between countries. Nowadays travel and the internet have made it possible to segment companies across continents.

Why do companies go this route? Unsurprisingly it’s for profit. For better or worse economics usually end up driving the train. While companies generally increase their profits by this kind of offshore segmentation, the shareholders are usually the only ones to see the benefit.

While there is high employment in a country then everyone is happy, however when there are large numbers of lay-offs the ethic of “offshoring” become more personal. Suddenly your friends are laid off because their jobs have gone overseas. The resulting questions are complex:

Against offshoring:

  • It creates hardship for local workers.
  • If all profits only go to the upper echelons, shareholders or developing greater offshore structure, jobs will never return to the local workforce.
  • Poverty in the workforce and large-scale unemployment worsens a shaky economy.
  • Local workers’ lives should be more important than quick profits.

For offshoring:

  • It may be the only way a company can survive the recession.
  • Resulting profits could create future jobs for rehiring of locals.
  • A failed company will ultimately be worse for the country’s economy.
  • It’s going to happen anyway. Be the first to gain from it. Your workers will have to retrain before too long regardless. Better sooner than later.

Is there a clear answer? Not really. Economically offshoring makes more sense, but it would be nice to think that companies would put on a self-imposed limit on spending the profits. Rather than allowing them all to go to upper echelons and shareholders, perhaps they could commit a portion to retraining and new job creation.

Tuesday, January 13, 2009

Is Blogging Important in International Marketing?

Today Advertising Age published a list of the 934 most visited blogs. Somewhat unsurprisingly Seth Godin’s blog is at the top. Trolling this list however, it was very hard to find any non-US blogs. Coming in at number 3 was a blog based in Bahrain. An Australian blog hit number 10 and Italians and Canadians took the number 15 and 16 spots. Of the top 50 blogs 40 were from the US, 3 from Italy, 2 from Canada, and 1 each from Sweden, Bahrain, Australia, Netherlands and the UK.

What does this tell us? Firstly, we have to suspect that these stats only refer to English blogs. By all accounts China is a blogging force, but of course the language creates a seemingly insurmountable barrier to cross-fertilization. Secondly, we see a clear trend when it comes to marketing outside the US in English. While English blogs may increase in importance for marketing, they are certainly not there yet. Undue investment in this area will create an unbalanced campaign, unless low-level research reveals specific advantages for your market segment. Thirdly, if blogs are not being used in indigenous language, what e-communication is being used and what communications technologies are promising strong growth in that country or culture? E-communication is obviously growing worldwide, but preferred forms can vary widely from culture to culture and from country to country.

Some of my suggestions:

  1. Blogs that include automatic translation tools on their sites will be the first to cross the seemingly impenetrable barrier between language groups.
  2. Keyword searches in multiple languages.
  3. Assess how much the “blog phenomenon” is driven by US bloggers. If bloggers drive demand rather than consumers, then this form of marketing will quickly lose ground to the next new craze? Look abroad, because the next new craze might just be starting there already.

Wednesday, January 7, 2009

Crisis spawns new market opportunities

I just had a stimulating lunch with an executive from the food industry. During our discussion I learned how this company developed over the past decades and I was interested to see opportunities for the future. Where the economic crisis greatly impacts previous spending and traditional habits, it also creates new trends and opportunities. Here are some brief thoughts:

  1. How do your customers really view you in toto? What picture do they have of you in their mind’s eye? There are many ways to dive into this research, but a cursory troll of the internet often gives valuable information. Information can be particularly valuable from negative comments.
  2. Does this picture develop longevity in brand loyalty? If so for how long? Will your customers long for the time they…?
  3. While many previous customers may be visiting/buying less, which areas of your potential market are increasing? For example, if people have less money to spend, they may be at home more, yet most are on job hunts, so where are they going and what are they doing?
  4. What can you do to fit your product to “their” need?
  5. How could you offer over and above?

I believe companies who discover answers to these kind of questions, will not only survive the recession, but grow through it and greatly expand after it with a whole new wave of brand loyalty.

Thursday, January 1, 2009

Is Chrysler learning nothing?

After writing about the intelligence of Ford’s recent PR, it’s only fair to turn attention to Chrysler after their recent $1 Million “Thank You Ad”. What are they doing?

Firstly, is there anyone in the US who thinks this is a good use of $1M in the current climate? Whoever advised Chrysler to take this course of action is probably the same person who said it’s no PR problem to fly to DC in a private jet. The $1M they blew in a single day would have provided several jobs for a year. Why not give that money to someone who’ll make more with it like a successful small business owner? Chrysler obviously cannot be trusted.

Secondly, who is doing their market research? What media format did Chrysler choose for their blitz? Print - or so it seems - was the main thrust. I would be surprised to learn that as many as even 50% of the country were even aware of the ad. Furthermore I would think it would be less than 33% of those under 40 years old. Who is Chrysler trying to thank?

Thirdly, what is the purpose? If they want to help people buy Chrysler why not distribute that $1M in incentives to buy? There’s all kinds of ways they could have done this to make very powerful and effective PR in doing this. The result of this would have definitely achieved national media play as a bonus.

What can we say? I hope something changes at Chrysler before they get any more money.