Category Archives: 4. General Marketing

Experiential Marketing: SeaWorld vs. Legoland

I need to get out more. After a day at SeaWorld and a day at Legoland, I’ve gained an entirely new perspective on marketing. I know. Some of you will say, “wow, you need to let go”, but I can’t help it. The only vacation where I can really tune out is backpacking, where there’s little sign of human intervention. Put me in a resort or an amusement park, and to me it’s like swimming in a Petri dish of marketing. I constantly absorb all the packaging and spin and reverse engineer the intended segmentation and positioning. It’s fun. My son’s getting good at it too. “Daddy,” he said to me in line for Shamu, “SeaWorld must be targeting the NASCAR demographic.” Okay, maybe that was the voice in my head.

So for all you parents making a trip to San Diego this summer, let me put it in terms your kids will understand. SeaWorld kind of sucks. Legoland rocks. Only now I’ve ruined it. Because the reason SeaWorld sucks and Legoland rocks, is because the experience is entirely the reverse of their reputations. I came to SeaWorld expecting Disney World in a giant fish tank, and although you can’t help but be impressed by a whale doing a back flip, the small moments of awe are like diamonds strung on a necklace made of cheap string. The expectation of a world class amusement park simply doesn’t match up with reality.

Legoland, on the other hand, has a reputation of being an amusement park for third-graders, an impression that grows when you first enter the park. My son was giddy with excitement at every sight of a Lego dinosaur or giraffe. And after a kiddy coaster and a storybook boat ride, I steeled myself for an entire day in It’s A Small World™ hell. But I turned out to be wrong. Legoland is like a bird trying to break out of a thick shell. The vestiges of a 1960s kiddy park are everywhere, but there also a lot of really cool hands-on activities, and some new rides diabolical enough to attract adrenaline junkies—including a row of huge manufacturing robots that twist and spin their hapless victims like parts on an assembly line. While the riders are flipped and dangled over a pond, spectators control small cannons that shoot water at the riders. Time it just right, and someone being flipped at three Gs over the pond gets a blast of water in the face before they’re whipped back around and flipped over the next cannon. Oh, and riders choose their own ride intensity. Can you handle Extreme?

As a marketer, seeing these two parks back to back—huge revenue generators stoked with millions of dollars in targeted packaging and spin—was its own amusement experience. They’ve both been around so long that you can clearly see how they’ve dealt over time with a changing culture and with the growing challenge of a massively over-stimulated video generation. And in this, they’re polar opposites. As two prime examples, let’s take their respective approaches to environmental consciousness and audience engagement.

At SeaWorld, you’re constantly reminded of their dedication to conservation and environmental protection. By big signs co-branded with corporate sponsor Anheuser Busch. But they seem to miss every opportunity to make it part of the experience. In the long meandering walkway that threads through the very cool Shark Experience, there is an endless opportunity to educate visitors with interactive displays and video—the kind of thing you’d expect at a real aquarium. The kind of thing that says, “this is what we’re all about”. Instead, the walls are completely empty, reminding you that you’re just waiting line, until you get to the big sign trumpeting SeaWorld’s conservation partnership with Anheuser Busch, reminding you that beer and funnel cakes are waiting for you just outside.

You get the same sense of window dressing with the performances. The animals are beautiful, but the trainers seem like Richard Simmons devotees on steroids, clapping and dancing with 1000-watt smiles. No one comes to SeaWorld to see synchronized wetsuit dancing, but that’s what you get. I suspect animal rights regulations have eliminated the triple-back-flip-gainer-through-a-ring-of-fire performances. Now you get a couple of high jumps and a lot of audience splashing, as if they went to the Gallagher school of comedic performance. Oh, and the constant sound tracks with syrupy voices. They sound like they were written by a real estate ad writer dabbling in new age religion. “…where those that swim the oceans touch those that walk on land…” It’s worse than getting seasick.

Legoland faces the same challenges in a completely different way. The park makes up for a lack of issue-driven window dressing, with creative ways to engage and interest the same audience. Instead of spouting off about environmentalism at every turn, Legoland engages socially conscious visitors by offering healthy food. When you walk into one of their markets, along with the cappuccinos and lattes, they have fresh fruit, yoghurt and cereal. They have salad bars and pasta. They have juices and lots of plain old water. Yes, they still have burgers and coke, but the alternative is equally available, and that realization carries a much more effective message than a self-congratulatory billboard.

The same ethic holds true in their approach to engaging visitors. They don’t have a ton of new rides, but the ones they have are exciting, and they’re doing some interesting things by making the rides interactive—a number of rides have features where spectators can shoot water at the riders. It’s subtle, but you get the sense that they’re starting to let the same excitement for engineering and imagination that drives their product innovation seep into their park. It’s not broadcast from overhead speakers while you’re waiting in line, but the impression comes through loud and clear.

In all, the back to back experience of Legoland and SeaWorld seems like a metaphor for companies dealing with the big changes in consumer expectations. Some companies throw a lot more money at plastering messages and packaging over their problems, while other companies focus on digging down to find and explore the real value they can offer that will engage their market. The experience speaks for itself.

Today we’re heading back north and stopping at the LeBrea Tar Pits. You know. Dinosaurs. Stuck in tar. Wonder what else we’ll find.

Marketing Needs Geeks, Not Gurus

Someone introduced me the other day as a marketing "guru". It was one of those moments where you drift off mentally and start watching the discussion like a detached observer. You could almost see the thought bubbles popping out my head. "Hmmmm. Guru…"  It was someone I respect, so I was kind of flattered. Guru. Someone with answers. A man with a plan. But the more I started to think about it, the more I started to suspect my sense of flattery was misguided. I mean, how many words do we have to describe someone who spends too much time thinking and then pontificates about the most grinding minutiae? Like, what "guru" really means. The only other title I can think of that’s equally vague on the professional value I provide to the world is "consultant". And who wants to introduce a consultant when you can introduce a guru?

A few hours after basking in the afterglow of misplaced flattery, I got schooled on how tenuous the domain of gurudom can be. I submitted an article to a friend’s newsletter on Marketing ROI, in which I took my usual stance of flogging marketers for flaunting buzzwords and failing to grasp deeper meanings. That’s kind of like an old baseball mitt for me. Fits nice, usually does the job. Except this time I got called on it. Jim Lenskold, who publishes mROI Insights, sent back my draft with some very diplomatic editorial comments. Translated into the vernacular, he said "Dude. You’re beating a straw man. Add some substance." That started the very beginnings of a useful conversation about the current state of Marketing ROI thought, and demonstrated how deeply many individual threads of marketing thought are being mined by people like Lenskold. How could I be a guru when there’s such a vast amount of knowledge I don’t know?

And that’s when a lightbulb went off. Why do marketers focus so much on elevating gurus? And why don’t we have more geeks? A guru is always supposed to have an answer, while a geek is just someone who’s really really interested in finding out how to make things work. The irony, of course, is that the single most ancient rule of Guruhood is that it’s not having the answers that matters, but getting the questions right.

But gurus don’t ask questions–at least not the kind they really want answers to. If I’m a guru, I can’t let Jim know that I may need to be brought up to speed on the latest in Marketing ROI. I Must Know All. On the other hand, if I’m a geek, I can just say "Cool. So how do you do that? What else do you know?" In a business world that is changing so blindingly fast, with a constant flood of new technologies, new ideas and new opportunities how long can any one guru conceivably last before they’re obsolete? And how long before we notice they’re obsolete and stop listening to their pointless babble? You don’t have that problem with geeks, because geeks are always focused on learning–well, at least as much as they like to show off–and are always interested in gathering with other geeks to learn. Everyone wins. Well, everyone except the marketer who thinks an answer from a guru will save him from getting his ass kicked at the next board meeting.

I know it will be really hard to shed this deeply engrained need for the certainty that comes with the spouting of pundits. But what marketing really needs today is more geeks, not gurus. Everyone can be a marketing geek, while marketing gurus, if there really are any, are bound to look stupid in the long run. Why run the risk of having them take you along for the ride?

Direct Marketers are Insane

One of the pop definitions of insanity is doing the same thing over and over again and expecting a different result. One of the pillars of direct marketing is running continuous campaigns that hit the same consumer numerous times. That means any direct mail campaign that does not evolve and adapt over time is insane by definition. Today, I received in the mail my regular dose of United Airline’s credit card campaign–the same exact ugly piece of mail I’ve now shredded every couple of weeks for something like two years. It has *never* changed. I will *never* get a United credit card. People wonder why United is on the rocks? These people couldn’t market their way out of a paper bag.

Marketers love to measure campaign metrics, and every marketer knows that a successful campaign entails multiple impressions, often over many weeks. A good Direct Mail campaign might return conversion rates of only 1% and still be successful, but that rate typically goes up when the marketer adjusts the campaign with different messsages and offers. What marketers often ignore, however, is the equal and opposite measure of conversion. A vulgar but effective name for this might be the Peeing in the Pool metric. For every 1% of the market you convert, you annoy, anger, and alienate some percentage of your potential future market, which makes it more expensive for you to market in the future.

Although few actually track this metric, it’s probably close to the inverse of your rate of conversion on successive campaigns. As the curve of conversion drops, the curve of alienation grows. And I strongly suspect this effect is magnified when the repeated campaign goes on forever unchanged. Each repeated drop of the same message to an unresponsive customer becomes an annoyance associated with your brand. It’s like you’re actually paying to alienate future potential customers. And that is insane.

The Impact of MTV

A lot of people were talking about MTV’s big 25-year anniversary this week–though not MTV, since they don’t want to remind their 14-year-old prime audience that they’ve been around so long…

If you didn’t catch it, NPR’s Talk of the Nation did a great show on the meaning of MTV and it’s impact on society and culture. You can find a link to the story, with an audio file and lot’s of supporting information at this link. It’s well worth the listen. Two of my favorite snippets:

1. MTV, despite its name, has perhaps had a greater impact on society with its introduction of Reality shows, than its music videos–notwithstanding its music successes, including its service as a vehicle for rap to hit the mainstream, along with black pop artists.

2. MTV doesn’t age. Every year they spend a lot of resources researching their 12-18 year-old target audience and tweaking their content, such that every 4-year cycle of high schoolers will no longer resonate with MTV by the time they graduate from college. They of course have launched parallel channels to hold on to some viewers, but at the core, they have a single-minded focus on their primary audience.

There are some troubling aspects to MTV’s success, exemplified today by the disturbing implications of the runaway success of shows like "The Hills". But that’s another thread. What’s interesting to me, good or bad, is the ability of a media institution to have such a tremendous impact on our culture, and this is a decent overview by NPR.

Speaking of which, I’m quite impressed by NPR’s production quality. They make very effective use of the Internet to augment their stories, by adding useful supporting content and outtakes they can’t fit into the broadcast. It’s not the fluffy crap you usually find as extra material–like on most DVDs–but information that expands the experience. Great stuff.


The Future of Marketing

While I was away, I had an article out in Executive Decision and an interview with Investor’s Business Daily discussing various opinions on the road ahead for marketing. If I could always be this productive while on vacation, I’d never come home.

The Executive Decision article is probably the most succinct discussion I’ve written in the past few months about the challenges marketers face in today’s business environment. The crushing day-to-day requirements for most marketing departments puts the lie to all the best-selling pap about "customer-centricity". The ugly truth is that the average marketer today doesn’t have nearly enough resources to spend time worrying about the customer–there are far greater pressures to reshape the marketing function into an omniscient analytical machine. 

The interview with Investor’s Business Daily isn’t all that illuminating on the surface. Just a few quotes on background in an article about Dell’s recent misteps, with a focus on the impact of marketing. What’s interesting is that the discussion about marketing’s shift toward an analytical framework was so fascinating to IBD, and they saw it as a lens for understanding significant challenges facing companies like Dell. If marketing got that much respect in the boardroom… You can find the IBD article here.

What does all this have to do with the future of marketing? Marketing is at this very moment in the middle of a massive re-engineering. The focus on building an analytical foundation for marketing that utilizes technology to track customer lifetime value and weigh opportunity value is important, and will certainly shape marketing for decades to come. But it’s not an overnight transition. The shift has been underway already for at least five years, and will be another five years before the expectations business managers have today for useful dashboard measurements will be realized in any intelligible form. In the meantime, the incredible pressure to effect this transformation is taking marketers away from their primary task: knowing and serving the customer.

The immediate future of marketing will be marked by two basic types of marketing organizations: those that get so distracted by a focus on the promise of emerging analytics that they completely abstract the customer (Dell?), and those that manage to keep a firm grasp on knowing and serving customers first (Apple?). For now, it seems there are far more companies in the former camp than the latter.

Targetted PR Messaging

A couple of people responded by email to my post about Segway–where a PR rep at an obscure industry vertical tradeshow made Segway sound like an obscure product for an obscure vertical during an interview with National Public Radio. What *should* she have done–give up the opportunity to get Segway’s name out over the national airwaves?

No. The problem is more strategic than tactical. If you’re making an investment in PR, you should be working with a company that understands targetted messaging and how to deliver it. The message you position with a trade press journalist is not the same story you deliver to the general business media, much less a mainstream consumer audience like NPR. You and everyone who represents your company should have a playbook of targetted messages for different media outlets and journalists, and you should have it memorized.

When a reporter from NPR showed up at Segway’s booth, Segway’s representative should have had a message ready for a national audience, or she should have phoned home for support. Instead, Segway blew an opportunity to connect with one of the nation’s largest audiences of educated, affluent and environmentally aware consumers–exactly the audience Segway needs to connect with. Those are the kinds of mistakes you can follow right to the bottom line.

How Do You Market a Miasma

I guess I wasn’t so afar afield with the posting on Barry Bonds after all. Turns out, now that Bonds is only a handful of homers away from breaking Babe Ruth’s home run record, Major League Baseball and the marketing heads of sponsor companies are wringing their hands about how they should participate in the celebration. Tough branding moment here. Do you continue to attach your product to a taintend pitch man? You can just see the gears grinding. Steroids: Bad. Spotlight: Good!

MLB’s top marketer took a bunt, saying they wouldn’t pop the cork until Bonds passes Hank Aaron’s record–which conveniently puts the pressure off most likely until another season, if not permanently. "The big record is 755," said Tim Brosnan, executive vice president for business. "That’s when we go national. That’s when we bring in sponsors and create national campaigns in celebration." So, basically, MLB will keep it’s finger in the wind until public opinion moves decidedly in one direction or another.

Pepsi’s president, however, said they would celebrate Bonds’ breaking of Ruth’s record, but, ahem, "in a muted way." I guess Pepsi is the brand of nuance. Maybe they’re banking on some share-of-mind points by being on the fringe of controversy. And what exactly does "muted" marketing mean? I’d pay good money to see that Creative Brief.

Taking the path of easy expedience, Home Depot said they would celebrate only if Bonds is cleared of all steroid-use allegations. Only Bank of  America took a firm stand, saying they would not participate in celebrating the achievement in any way. "A company like ours is always going to choose the untainted opportunity," Bank of America’s Cathy Bessant told Bloomberg News.

A company like ours… Interesting way to phrase it. So, what are the other companies like?

The Future of Marketing?

This story has been rattling around in my head ever since it was reported a couple of weeks back, but I haven’t seen a lot of commentary on it. AdAge reported that Ford has hired Accenture to audit its marketing plans for major car model launches. Without getting into a discussion on the merits or failings of Accenture, or the particuluar challenges faced by Ford, it’s a significant sign of the fault lines emerging in the marketing industry.

Businesses have been griping for years about the failings of the agency model–largely to no avail. But when a major U.S. corporation hires a business consulting firm to audit it’s marketing plans, you can no longer ignore the obvious fact that marketing agencies have let a tremendous void grow between themselves and their clients. I would lable that void: Boardroom Credibility. And business consulting firms like Accenture have obviously determined it’s a void they can drive a Brinks truck through.

Ford takes pains to say that this isn’t a creative issue–that Accenture won’t be replacing their other agencies–but that only rubs salt into the wound. It’s like saying, "you creative types, don’t worry your little heads about this, just go on making pretty pictures, or whatever it is you do, while the grownups talk business." Clearly Ford has major concerns about its marketing investment which their agencies have failed to mitigate. Now Ford is looking beyond the agency for strategy validation.

Talk about dropping the ball…

Engineering Upselling Opportunities

I have a theory about Starbucks. For being the world’s most successful coffee shop, they sell the worst coffee in the world. How is that possible? Have you ever tasted Starbuck’s coffee? I’m not talking about all the flavor-laced Dope-accino drinks, but the coffee. That burned and bitter sludge you have to drown with milk and sugar just to choke down. It’s awful. But through the brilliance of Starbucks’ marketing, it’s also guaranteed to be the closest caffeine fix to anywhere you happen to be in the world at any given moment.

For years I’ve stayed loyal to the neighborhood roasters with good coffee, and limited my Starbucks visits to those times when I was away from home. And it would annoy the hell out of me every time. You can’t order a "medium" coffee. It has to be "Grande". And it’s not just some pre-career Goth taking your change, it’s a Barrista. I’d stand there in line listening to all those abbreviated insider codes "double-quad-nowhip-mocha, extrahot", convinced I was on the fringes of some cult. The dependency. The special language. The willingness to donate handfuls of cash with a vacant happy stare. I finally realized the bad coffee was a way to separate the skeptics from the true believers.

When a Starbucks opened right next to my office, I found myself buying more of their crappy coffee, and then upgrading more frequently to a Latte just to avoid the torture. When I finally graduated completely from coffee to the poodle drinks, it struck me: Crappy coffee is an upselling opportunity. It’s what everyone initially comes for, it’s the cheapest thing on the menu, and it sucks. But for just a few dollars more, you get flavor. Any flavor you want. Any combination. And once you make the initial leap, a banquet of delights appears before you. Add a little chocolate, a little orange, a little cinnamon and whipped cream. It’s just money. And once you buy a Starbucks’ loyalty card, you won’t even tally up the transactions any more. Just dump some cash on the card every payday and you’re good to go.

I thought it was an amusing little theory–Starbucks makes its coffee undrinkable to migrate customers to a better tasting, more expensive beverage–a little marketing conspiracy theory to kill time in line with a client. But then I heard one of my friends talking about a recent experience with, and I started to wonder.

If you haven’t heard, Salesforce had a few hiccups in its service over the past few weeks. One of my friends runs a company that relies heavily on, routing its lead generation streams through the application. It turns out the outage wasn’t so much a blackout as it was a brownout. The system was continuously going up and down over the course of a week. Every time it went down, my friend’s IT team had to divert their prospecting feed away from Salesforce, and then restore the connection when it went back online. A little annoying to say the least. Finally they called the Salesforce support team and said, hey, why can’t you send us an alert when the system goes down and when it comes back up, so we can stay on top of this problem?

Are you ready for the response? Sure, Salesforce said, we can send you an alert, but that’s a service included in our Platinum Support Package. Would you like to upgrade?

When I heard the story, I had visions of a Salesforce executive standing behind a row of servers with a plug dangling from his hand watching the Platinum Support Upgrade Dashboard. Drinking a double caramel macchiato.

To Save A Town, Why Did They Destroy It?

Santa Maria used to be a city of small stores and Main Street lives. Now, all that is gone — and so is its soul (Originally published in BusinessWeek Online, August 31, 2004)

I took a short vacation with my family to visit the town where my wife
grew up. It was the town where we met some 15 years ago, the place
where my parents retired, and where I landed after wandering overseas
between college majors. Back then, Santa Maria was an agricultural
backwater on California’s central coast, a pit stop on the way from San
Francisco to L.A. It was a town with a vibrant history, but little use
for it — an impossible place to love if you didn’t have roots there.
For me, it became the town where I met my wife, where my father died,
and where I got my first tastes of both business and journalism.

Today, Santa Maria is a burgeoning Wal-Mart suburb. Everything and nothing has changed. Where once there were neat
rows of strawberries and broccoli that went on for miles, now there are
endless fields of single-family homes. In a town that once couldn’t
attract a national grocery chain, you now find the same brand-name
strip malls that dot almost every town in America. Starbucks-Blockbuster-Subway-Kinkos — prefab economic zones you can buy off
the shelf to drop into your half-acre plot along Main Street, some
assembly required.

On a national scale,
this is the face of progress. These manufactured main streets feature a
star-studded array of brands that are leading markers on the stock
exchange, where they build our retirement accounts and our children’s
education funds. But on a local scale, especially in a place like Santa
Maria, the history that is being paved over holds some interesting
clues about the future — clues that are convenient to forget in the
face of short-term profits.

Like most California cities, Santa Maria has an old town —
the intersection of Broadway and Main — where solid buildings from the
early 1900s line the streets. Well, Santa Maria used to have an old
town. Where many California cities now have a revitalized core, with
old brick buildings turned into stylish restaurants and side streets
turned into open air markets, Santa Maria has a massive monument to one
of the most influential fads ever to sweep city planning — the Town
Center Mall.

In the mid-1970s, Santa Maria bulldozed their entire city center in
order to build a huge shopping mall and parking lot. The new mall
generated a lot of wealth — for about a decade. As soon as outlet
stores started cropping up along the freeway, and then Big Box discount
stores, even a Barney Carousel couldn’t salvage the Town Center’s
consumer appeal.

Now the mall is half
empty, and the anchor-tenant department stores are struggling. During
our vacation, my wife took advantage of the 15-hour Super Double
Discount Sale at one of the major retailers. When my wife balked at
paying the "slashed" sale price of $29 for a Finding Nemo
throw pillow my son was clutching, the check-out clerk whispered the
name of a nearby discount store where she could get the same pillow for
half the retailer’s sale price.

You don’t need an MBA to do the math on the future of that
retailer, or the future of the mall. In fact, the city is already
trying to figure how to do what they weren’t willing to do with the old
downtown — revitalize a retail ghetto of empty storefronts. One of the
leading ideas is to turn the entire mall into an assisted-living
facility. That’s right, renew the city center with a very large nursing
home. I suppose there’s a certain logic to it — all the unused parking
space could easily convert to a cemetery.

What no one seems to be asking, either in Santa Maria or many
of the other towns that now look exactly the same, is what time frame
should drive investment decisions. Just as business-development and
investment decisions on Wall Street are driven by quarterly results,
our city-planning decisions are increasingly governed by short-term
payoffs. But instead of losing our shirts to scandals like Enron and
Worldcom, we lose something far more profound behind the new facades of
one-size-fits all city streets. What we lose are the stories that make
our lives meaningful.

Okay, call me a romantic.
Tell me I just don’t understand the capitalist economy. Tell me all
about the cycles of change that have gone on before, and how we always
move forward. I’m not buying it.

Taking Santa Maria as an example, the payoff on the mall that
wiped out much of the city’s history lasted little more than a decade
— and that’s not counting the hefty residual, which hangs like a
mall-sized albatross around the city’s neck. The economic cycles of
outlet centers and big box stores are running even faster. As soon as
one town builds The New Thing, the town at the next freeway exit has to
get one too in order to recapture escaping sales tax revenues. In a
couple of years, demand is diluted too much for any one city’s
investment to pay off.

In the short run, of course, developers do well, cities
collect some nice fees and sales taxes, and retailers expand volume.
And there’s always the potential for another big project to bail us out
when the current scheme runs out of steam.

But how much value do we
place on a sense of place, or a sense of history? History only tells us
where we’ve been, but it’s those stories that help us understand who we
are and where we’re going. What stories do we tell about our
communities when our history is relegated to some old black and white
photos in the barber shop or a doddering historical society?

The sad truth seems to be that we are reduced to telling stories only
through our possessions. We are what we own. We are what we drive. We
are individual "brandscapes," buying and assembling our identities
through the metaphors of clothing, furniture, and food.

There’s some beauty in this. Everything is invested with
meaning, since everything we own has the potential to say something
about who we are. And the whole grand economic exercise, from corporate
marketing to supply-chain management has a masterful efficiency — our
purchasing power as consumers, the lifeblood of our economy, is now
directly coupled with, and driven by, our psychology of being.

 But at the end of the day, we
are giving up a society in favor of an economy. When every decision —
even decisions that cut to the core of our community — are dictated by
the most immediate profit opportunity, it makes sense to tear down a
city in order to build a mall. It makes sense a few years later to
build big discount centers to undercut the mall. Cross every bridge
when you come to it, and let every decision be driven by the shortest
break-even point on the balance sheet.

Maybe it doesn’t matter, but Santa Maria no longer feel like
the town where I met my wife, where my dad died, and where I got my
first taste of business and journalism. It just feels like every other
town on the way from San Francisco to L.A. That relentless consistency
is what made McDonald’s  a household name in 150 countries around the world. But I don’t want to live there.