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.

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.

Is Ford showing the way out of recession?

A couple of weeks ago, most people were rightly criticizing Ford, Chrysler and GM's CEOs for their arrogance or ignorance in flying to DC in private jets. This week Ford's CEO has been the first to show understanding of what transpired. Ford's answer is not only to rectify a mistake, but also to show forward thinking out of recession.

In refusing the bailout money, Ford is rectifying a really bad marketing and public relations mistake with a real win. Judging by the massive outpouring of goodwill on the web since this step was announced, Ford's future looks rosy once consumers have the money to buy new cars. In fact, in my opinion, as cars are necessary to the bulk of Americans, and as Americans will want to help the US economy, Ford is likely to win market share even in the recession.

Secondly, in refusing bailout money, Ford has separated itself from GM and Chrysler. Ford now looks like a healthier, more forward looking enterprise, and that "feel" will transfer to perception of its cars. It's a shame for Chevrolet (GM) as its marketing of the new Malibu was pretty nice. The rest of GM and Chrysler in toto really don't seem to have done anything for the longest time.

Ford's decision should encourage businesses to look to the future and to recognize the critical importance of its positioning at this juncture. This recession is levelling competition and public relations and marketing coups won through this hardship will be worth double those made in a strong economy. The timing for Ford couldn't be better as Toyota (of Lean Management fame) just posted its first loss in 70 years. If it markets well, and if it ensures a quality product, who knows where Ford may end up in 2 years. Yes, it will still be a challenge for Ford over the next year, but I would be willing to bet it ends 2009 in a much healthier position than GM or Chrysler.

Madoff, Dreier and Marketing

With the Dreier scheme, Stein Bagger and the IT Denmark scandal and the uncovering of what appears to be the biggest Ponzi scheme in history in New York (Madoff), does it get any worse? One thing is clear - that many of the "recognized authorities" were solely convinced with apparent success and greed, rather than sound business review. How could Ernst & Young name Bagger "Entrepreneur of the Year"? How could so many influential investors invest with Madoff?

If we asked 100 people on the street if they believed in guaranteed permanent profits in their investments or guaranteed rises for no work, most would recognize this as impossible. However apart from the human suffering inflicted, this false belief, coupled with ever increasing greed, has led to wanton spending not just in bonuses but also in departments such as marketing.

Recently Casey Jones wrote about this in an interesting article in AdAge (12.18.08). If I were to put a practical spin on it, I would ask questions like this? If a non-profit can achieve national media response with one billboard after just a few days, what do so many companies spend millions blanketing cities with billboards that no-one notices? This true example shows how organizations, that have to take care in spending, can find ways to more success in advertising than the established big spenders.

Perhaps value for money in operations should be a more important issue when considering investment.

Customer Service, Customer Service

It's certainly not new to emphasize customer service. Marketers have pushed that for decades (although it could be said that the last 10 years has seen a move away from this emphasis for short term gain). Here's something to make those think who are perhaps succumbing to panic and throwing out the idea of customer service in favor of short term economics.

At the weekend a family member dropped my digital camera, pushing the zoom lens out of its track. I began to call stores to find out who had onsite repair, and what the charge would be. Most companies do not have onsite repair. However, I called a family business in the process of my search and the gentleman at the other end offered to look at the camera for free, and if possible fix it!! For free!! Needless to say, I went down to the store an hour or so later. While I was waiting to see if he could fix the camera, I began to look at potential replacements, with the idea that I'd find out the info and then probably buy it at a cheaper price online.

The man could not fix my camera onsite, but I was so impressed by his service I began asking questions about the cameras they had. I was then impressed by his knowledge and his honesty in telling me which models were "not really worth" it for me. To cut a long story short, as I had already done some research about price before I went, I was offered a very good deal with an exceptional make of camera.

I left extremely happy, determined to buy a second camera there for my wife and to recommend this store over all the megastores (who have lousy customer service and generally seem to just want to get your money out of you). The price was more than comparable because camera firms are competing in all marketplaces. All I can say is I hope this company takes over from one organization I could mention where I bought my computer. That well known national chain, has arguably the worst and nastiest customer service out there (including a corporate customer "service" person who told me "When you leave the store it's no longer our business" - and that despite the fact I bought an extended warranty). Not only do I never buy anything there anymore, even if it's a little cheaper. I always advise others to avoid this store.

Where will these two organizations be in 2 years time? My guess is that the family business will have survived the recession nicely, while the national chain will have downsized and worsened its reputation. We'll see.

Whopper Virgins - genius or madness?

Is Burger King on the right track? Does it promote or hinder the global village? Does it prove Burger King's burgers are better than...?

Firstly, I think we should congratulate Burger King’s marketers for coming up with an original idea that emphasizes the growing connectedness people are feeling across the world. Secondly, the Whopper Virgins have definitely created more of a stir than normal – something that in its own right proves some sort of success.

However, will the campaign increase sales? While I’m still in suspense as to the response, I suspect it will show Burger King’s burgers in a good light! How many people are as cynical as me? Years ago my brother was stopped on the street to try the “Pepsi Taste Test”. He immediately told them his preference for Coke, which made him the “ideal candidate”.
However, when he flawlessly showed which was Coke (he liked that one) and which was Pepsi (he didn’t), his statistic did not see the light of day. Decades later Pepsi is still number two to Coke.

Lastly, how does Burger King’s ad work in minority communities in the US? Do Chinese viewers like the “ignorant backwoodsy” Chinese people portrayed in the ad? And what about the ads around the world? Do viewers in Singapore see rednecks from Arkansas trying a Rendang Burger? Hmm….

Whopper Virgins - genius or madness?

Is Burger King on the right track? Does it promote or hinder the global village? Does it prove Burger King's burgers are better than...?

Firstly, I think we should congratulate Burger King’s marketers for coming up with an original idea that emphasizes the growing connectedness people are feeling across the world. Secondly, the Whopper Virgins have definitely created more of a stir than normal – something that in its own right proves some sort of success.

However, will the campaign increase sales? While I’m still in suspense as to the response, I suspect it will show Burger King’s burgers in a good light! How many people are as cynical as me? Years ago my brother was stopped on the street to try the “Pepsi Taste Test”. He immediately told them his preference for Coke, which made him the “ideal candidate”.
However, when he flawlessly showed which was Coke (he liked that one) and which was Pepsi (he didn’t), his statistic did not see the light of day. Decades later Pepsi is still number two to Coke.

Lastly, how does Burger King’s ad work in minority communities in the US? Do Chinese viewers like the “ignorant backwoodsy” Chinese people portrayed in the ad? And what about the ads around the world? Do viewers in Singapore see rednecks from Arkansas trying a Rendang Burger? Hmm….