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Successful Companies and Organizations Are Close to Their Customers

Bureaucracies stifle innovation. It doesn’t matter if the organization is an association, a government agency, publicly traded company, or a local mom-and-pop store.

This truism even applies to McDonald’s.

McDonald’s has always been the benchmark for standardization, uniformity in product and service deliverability, and consistency in pricing. With increased competition and changing customer tastes, even McDonald’s is now looking for ways to get closer to their customers.

This week The Wall Street Journal reported that McDonald's will eliminate layers of management and bureaucracy to streamline decision-making. This includes creating four zones— Northeast, South, Central, and West—to help organize the company around local consumer tastes and preferences.

According to the company, they want to be more sophisticated in how they use local intelligence to address specific consumer needs.

Smart move on their part.

Local control is important regardless of the type of organization.

It doesn’t matter if you are talking about the management of restaurants, schools, stores, cable companies, governments, or any organization that serves the public, individuals and institutions closest to the customer/diners/students/voters/etc. are the most knowledgeable and best suited to make decisions about customer needs and wants.

Yes, technology can allow organizations and management to get closer to their customers. It can help organizations tailor offerings and pricing to local tastes. It cannot replace input from line workers who are often outside the decision-making loop, yet possess some of the most attuned knowledge about their customers.

Burger King is experiencing significant growth by listening to franchisors who know best how to serve their customers.

Get local, decentralize decision-making, and grow.

It’s working for Burger King, Kraft, and potentially McDonald’s. It could also work for you.


No Research Is Better Than Bad Market Research

For the past few days, news gossip site FTV Live has chronicled survey research being conducted by Cox owned WFTV in Orlando. From the screenshots posted in the stories, it appears WFTV is testing potential anchor changes with area viewers using an online survey with embedded video.

Potential leaks are always a possibility with online survey work since respondents can take screenshots of the questions or take a picture of the screen with a smart phone or tablet. That’s why you should test multiple topics or try to balance the questions to mask the sponsor or goals of the research.

Not only does it help protect your business strategies, it also improves the quality of the research.

For example, if I’m a loyal viewer of a competing station’s news programming and it is rather apparent that the sponsor of the research is WFTV, knowing the likely sponsor could impact how respond to the questions being posed in the survey.

FTV remarks that “Cox won't change the paint color in the men's room at the station without fully researching it first and having a focus group weigh in.”

First, let me say that Cox is a good and well respected operator among the current media companies left standing.

However, if the screenshots are any indication of the research being conducted, they should just save the time, money, and effort.

Without going into all of the issues I see in these questions, let me just say that trusting your gut and your experience is far better than basing a decision on bad research.

Not so long ago, I spent a few years working for another media company that is often accused of relying a little too heavily on research. I’ve seen work whose sole purpose is to offer cover, support, or opposition for a predetermined business decision that had already been put in place. If the decision (i.e. a new anchor pairing) flops, managers can then use the “it tested well” argument to deflect any criticism they may face down the road.

This creates the corporate researcher’s paradox. Do it right and have the results potentially conflict with management wishes, or go along to get along and live to see another day.

The latter course of action is better for career advancement, and the former is better for our profession. 

I know it’s difficult and counterintuitive, but if you are good researcher and the wrong tools or questions are going to end up being used, recommend against the research. Cite budget issues or the opportunity to deploy the funds elsewhere for things like promotion.

Do what you can to avoid taking the hit down the road if the project goals go south.

Corporate researchers in rapidly changing industries like broadcast media have one of the most difficult jobs imaginable battling more demands amid shrinking resources.

I feel your pain.

So please do what you can to stop a bad research project or call a consultant in to fight the battle for you if you can’t stop it on your own.

Our industry is facing enough issues right now. So please be honest with the limitations of what can or can’t be done using market research.

Your future career and our industry may depend on it.

How To Create Videos That Go Viral

Viral content isn’t random or dumb luck. Research from the Journal of Marketing Research sheds light on why people share content and provides insight into designing effective viral marketing campaigns.

Video content that arouses strong emotions -- such as awe or anger -- in viewers is more likely to become viral than videos that induce sadness or relaxation. The study by Wharton professors Jonah Berger and Katherine L. Milkman, also found that positive content is more likely to be viral than negative, although negative content was also linked to virality in cases with exciting content, such as a high-speed car chase.

Repairing Damaged Brands… And Damaged Political Parties

Damaged brands can recover. So can damaged political parties. Companies and individuals ranging from Dell, Michael Vick, to Tylenol have made amends or reinvented themselves in such a manner that has rebuilt their trust with the public.

So how do you do it? How does a political party do it?

It’s the same prescription for both: Stop ignoring your customers’ needs and pretending that they don’t matter. Show some compassion and demonstrate that you are suffering the same maladies as your voters. Prove to them that you really care and that you are willing to make things right. Bill Clinton’s “I feel your pain” was incredibly effective for a reason.

Voters, like customers, are connected. If you lose one, you lose their friends, Facebook friends, Twitter followers, etc.

Every candidate is an extension of a brand and is acting on behalf of their party. It only takes one stupid/careless/ignorant statement by a down-ticket candidate to wreck every other candidate with an R by their name.

Voters never forget. But they might be persuaded to forgive you if given a reason to.

Welcome change and outside help. Reach out to voters and ask them to help you improve. Identify what voters need and want from you and try to deliver. Give them something to rally around, something that is relevant to their needs.

Don’t be desperate and don’t pander. Be genuine. Voters can smell a con job. They also can smell fear. They will not jump on the squishy crisis train. Be confident about who you are and why you can make a difference in their lives. You also have to show them how it will make a difference in a language they can understand.

Constantly ask voters for advice on how you’re doing and make them part of the rebranding effort.  Create a community online and offline who can be part of the process and keep them up to date with your progress, where you are headed, and how their contributions are part of the path. If they are involved with the process they will be committed to ensuring that their efforts will be successful.

Customers’ Online Feedback: What to look for

Over at Entrepreneur Online, social media consultant Mikal Belicove offers some reasons why businesses need to pay to attention to customer feedback. Belicove’s tips are based on research conducted by Bazaarvoice, a Texas-based company best known for its ratings and software reviews.

Nobody can deny the importance of monitoring customer feedback. It is absolutely critical. So what do you look for when you are reviewing online comments for your business? Here are few questions that you need to answer as you look at the feedback:

  • Where are you under-performing in the eyes of customers? 

  • What issues need to be addressed in your product, service or with your staff?

  • Do customers consistently mention a particular attribute of your business as very important?

Your goal should be to understand the aspects of your customers’ experience that drives satisfaction and ensure that you consistently deliver on those items. Take those aspects where you excel and include them in your communications with customers to reinforce your commitment to satisfying the items that they deem important. Together, these simple steps can help you build a loyal customer base.  

Testimonials Only Improve Sales If They Are Targeted

Getting your delighted customers to share their stories of satisfaction with your business can be a powerful marketing tool, John Jantsch writes at Duct Tape Marketing. He offers several ways to capture these testimonials, such as creating an automated form or holding a party for your clients.

Testimonials are tried and true and part of the fabric of sales. I’ve heard them called a lot of different names  (10 Tall Tales was one of the most creative) and they are truly effective if it applies to the customers need. Prospects want to hear what you’ve done for your previous clients. If they have a customer retention problem, a testimonial about driving traffic to a customer holds little punch. Prospects want to hear success stories that closely resemble their current issues.

It all begins with an understanding of the customer’s needs. If you don’t know what’s bugging them, ask. Then tell them about the amazing successes you have had with previous customers.

The Challenges Of Managing Millennials and Living With The Never Retiring Baby Boomers

In USA Today’s Ask The Expert column, “Baby Boomer” Steve Strauss tackles the challenges of managing Millennials. In short, Strauss says Millennials may have a bad reputation in the business world for being exceedingly demanding, but managers need not shy away from this generation. He also gives small-business owners tips to effectively manage their younger employees, starting with treating them as the adults they are.

Millennials are typically defined as the age cohort born from 1980 through the early 2000s and have been called everything from Gen Y to Echo Boomers. These are basically the kids of the late Baby Boomers (born between 1955 and 1964) and it is quite amusing hearing Boomers bemoan and counsel others on the intricacies of managing their kids. Granted, this should be a group that they know a lot about.

The late boomers have been particularly hit hard by the terrible stock market and don’t have as much time as us Gen X’ers to make up for their lost 401(k) balances. So you can expect Boomers to be working for many more years trying to replenish their retirement funds, and no doubt counseling the rest of us on the challenges of managing their children.

Staying Ahead of the Curve (Keeping An Eye On DC)

With all of the talk about an amnesty bill in DC, I don’t’ think it is a coincidence that AARP is expanding its Latino-oriented, Spanish-language media properties. The expansion will will debut with the Spring issue of AARP's quarterly bilingual magazine, AARP VIVA Su Segunda Juventud. The brand will also extend into a TV show, radio series and Web site.

AARP is usually ahead of the curve in DC and is a great example of an organization that keeps an eye on the political tealeaves when looking for opportunities to grow. This is an important lesson for every business. One change in law can have a dramatic impact on your business. Keep an eye on Washington and plan accordingly. It could be the difference between a very good year, or very very bad one.

I Am The “IT” Department

Technology makes this a great time to be a small business. Rapid advances of technology have made it easier for small business owners to compete with the "big boys" on a newly leveled playing field.

From online postage to inexpensive accounting programs to easy web hosting and development, small businesses can operate nimbly, effectively and on par with larger competitors.

Want a great example? Barbara Heinrich, owner of Local Motion in Minneapolis, built her own mobile-phone application through BuildAnApp to display her hours, location and pictures of new arrivals. Several services have cropped up recently to help small businesses develop iPhone applications so that they can participate in the mobile market including:

If you are looking for a tool to maintain regular contact with customers that are on the go, you should probably check out one of these tools. Remember, you don’t have to be Southwest, CNBC or Amazon to have your own iPhone app.

Protect Your Brand, Customers and Reputation. It’s All You Have

In a tough economy, everyone is looking for ways to increase revenue. Organizations are making tough choices, customers are making tougher choices, and your people are doing everything they can to keep things moving forward.

This represents one of the most dangerous times for any business.

The tendency to do anything to increase revenue is tempting. But these short-term fixes can irreparably destroy the trust your customers, employees and peers have in your brand.

So how do you know if you are going too far?

Easy, ask your customers and your employees.  Marketing research is the only way to know what you’re your customers and employees are willing to accept.

Trust is built on two-way communication. It's about listening. To build trust, you have to clearly understand what your customers want and need from you and how they will react to new offerings or to changes in existing offerings.

Companies that listen to consumers, employees, and stakeholders will continue to produce excellent goods and services that will not compromise the quality and value that they expect from your brand.

Those who don’t listen are risking the one thing that will get them through the recession, their customers.

Do You Know What’s Around The Corner?

"Regardless of how you go about innovating, make sure you're continually pursuing the next thing, because a company's commitment to staying relevant must never cease," writes Steve McKee, president of McKee Wallwork Cleveland Advertising.

As McKee notes in the article, you must understand how customers view and interact with your brand or service to understand what’s next for your business. And knowing what’s next is the only way you can stay ahead of the competition.

Customers and markets are always changing and staying ahead of the curve is imperative if you want to stay in business.

Many businesses start out as innovators, win awards, and over time fall behind.

Just like mutual funds, past performance does not guarantee future results. Even if you have customers tied up in long term contracts, you will eventually have to convince them to renew. Will you have something new and innovative to share or will you be relying on your previous service and relationship?

Continually innovating and growing will not only keep a business relevant; it will also give customers another reason to stay.

Saying Goodbye Is Never Easy, But It Can Be Profitable

Letting someone go is one of the most dreaded and difficult tasks that a small business owner will encounter.

Firing a customer is doubly difficult.

In this tough market, many small businesses are cutting loose demanding, resource-draining customers who want deep discounts or pay their bills late.

Dropping these "high-maintenance" clients reduces frustration and allows entrepreneurs to devote their time to more profitable clients.

So how do you know if you need to fire a customer?

If you have customers that don't get the value that you are adding, don't appreciate your service, or have unreasonable demands, you should think long and hard about continuing the relationship. 

Not only do these types of customers eat up a lot of time, they do not create any positive word of mouth for your business. They also frustrate your staff. By forcing your employees to deal with these people, you are sending them a message that their professionalism, values or sense of quality don’t matter.

Letting a customer go is never easy, but sometimes it just has to be done.

Talk To The Wrist

Since February, customers of AT&T and T-Mobile wireless have been able to purchase a cell phone watch. The cell phone watch was billed as a high-tech mobile multimedia device with Bluetooth, speakerphone, mp3, video player, digital/video camera, and touch screen.

I understand the motivation from a supplier viewpoint. Globally, watch sales are down and the culprit, if you haven’t already guessed is the mighty cell phone. According to a survey by Seiko Watches, the proportion of Japanese aged between 16-49 wearing wristwatches has plummeted from 70% in 1997 to 46% today. Granted, the drop is more pronounced in Japan, where mobile phone ownership passed 81 million in 2004, and gizmo-jammed handsets rule the roost.

I can see this having a market in Japan. But with all the US fears about the safety of cell phone use including a slew of new headlines this week, I have to think that adoption in the US is limited at best.

Some Just Have To Pay More For Vino

According to Scarborough Research, here are the top 15 DMAs for adults who spend $20 or more on wine:

New York, NY

San Francisco/Oakland/San Jose, CA

Hartford/New Haven, CT

Los Angeles, CA

Miami/Ft.Lauderdale, FL

Bakersfield, CA

Columbus, OH

Fresno/Visalia, CA

Houston, TX

Knoxville, TN

Las Vegas, NV

Memphis, TN

Nashville, TN

Oklahoma City, OK

Philadelphia, PA

Most of these cities make total sense. However, I find it a bit odd that the three largest metros in Tennessee rank in the top 15. Tennessee’s liquor laws do restrict sales to independently owned and licensed liquor stores.  I have feeling that this is more related to higher than average wine prices in Tennessee instead of a penchant for a good wine.

Not to say that Tennessee doesn’t have good taste in wine, they just have to pay more for a good bottle of wine which pushes the numbers up.

Here’s a toast for the campaign for wine in Tennessee grocery stores . If they are successful in the next legislative session, they should be able to help the wallets of wine lovers in Tennessee and knock some of these cities off the list.

Ignore Your Customer (or Voters) At Your Own Peril

Marketers who have been around the block know that business interests often trump consumer needs. Yes, shocking. Who knew that businesses would expect customers to conform to their processes rather than creating products and services that fit the customer’s needs?

While there are many frustrations for market researchers, one particularly bothersome item that occasionally arises is hearing executives say that they need to educate their customers on why their (insert product or service here) is better than the requested needs of the consumer. Yes, we know better and we will be successful if we can just improve our communications. We don’t have a product problem, it is a communications problem. Ignore the research. Our customers don’t know what they want and we have to tell them what they need.

The current healthcare debate is a great case study of this problem. Instead of providing a solution that most Americans would find of interest, the current proponents of the plan are trying to convince a larger number of Americans that they know better and their way is the only solution.

On the other side of the fence, health insurance companies have consistently failed over the years to take care of their customers, and they’ve created processes only an actuary could love. Insurance companies deserve to be forced into change. If they had made changes and innovated along the way, consumers would not be demanding reform.

With these two sides failing to listen to their customers/constituents...is it any wonder that people are fervently protesting?

What should be worrying the proponents of healthcare reform are not the people protesting the plan, it is the silent consumers/voters watching and complaining quietly. For every customer who calls to complain, there is a far larger number who do not call and will defect at the first opportunity.

There is not a communications plan or strategy that can successfully force consumers into a program they don’t want. The consumer or voter will always win out in the end with their wallets or their votes. He who ignores his customers/voters, does so at their own peril.

What Comes Around..

Nestlé USA is taking aim at Muscle Milk, filing a complaint with the National Advertising Division of the Council of Better Business Bureaus that has since been referred to the Federal Trade Commission and the Food and Drug Administration, as well as filing a petition to revoke the brand's trademark. Nestlé says that CytoSport's Muscle Milk name is "deceptively misdescriptive" because the beverage contains no milk. The New York Times

Muscle Milk has been quite litigious over the years. They’ve sued in the past to block others from using variations of milk, opposing trademark applications for products including Mega Milk, Active Milk Shake Plus and Monster Milk.

So why is Nestle going after a sports drink company? Apparently Nesquik is promoting itself as a sports drink: after a 2006 study partly funded by the dairy industry found that chocolate milk helped in replenishing the body after workouts.

I don’t think I would be going out on a limb to say that that the previous targets of CytoSport’s attorneys are cheering Nestlé on as they challenge CytoSport’s trademark on Muscle Milk. I’m all for protecting your brand, but when you go overboard, karma is going to bite you back at some point. Looks like CytoSport is finally getting a dose of their own medicine.

Walmart A Green Brand? Seriously?

Here are the 10 greenest brands according to the 2009 Global Brands Survey.

Top 10 Greenest U.S. Brands

1. Green Works (Clorox)

2. Burt's Bees

3. Tom's of Maine

4. SC Johnson

5. Toyota

6. Procter & Gamble

7. Walmart

8. Ikea

9. Disney

10. Dove

Source: "2009 Global Green Brands Survey" conducted by WPP agencies Landor Associates, Cohn & Wolfe, and Penn, Schoen & Berland and independent consulting firm Esty Environmental Partners.

Tom’s of Maine, Burt’s, and Green Works are expected. But Wallly World? Did not see that one coming.

Back in 2005, CEO Lee Scott surprised everyone by embracing sustainability in a speech announcing ambitious initiatives on "all the issues that we've been dealing with historically from a defensive posture." Since then, Walmart has implemented an aggressive sustainability strategy, much of it employee led. Just last week, they unveiled plans to measure the sustainability of every product they sell.

The cynic would see this as a shameful PR attempt to blunt their constant negative press and to box in their critics. Whatever the motivation, it is amazing how far they have pushed this and how much they have accomplished in the past three years.

One Out Of Three Considering An SUV

The number of vehicle shoppers considering an SUV has fallen to 34 percent, the lowest level recorded in the New-Vehicle Buyer Attitude Study from Kelley Blue Book Marketing Research, Irvine, Calif.

But... that’s still a third of the market.

Granted the only segment among sport utilities to see any growth in interest is small SUVs. Interest in purchasing a mid-size or full-size SUV decreased, and luxury SUVs remained flat.

The No. 1 reason for not considering an SUV is the escalation of gas prices. The percentage of those citing fuel prices as a major reason to reject SUVs was up eight points from last year to 61 percent.

On a side note, the study also found that nearly 90 percent of shoppers in the market to buy or lease a new vehicle do not believe that SUV drivers should be described as patriotic.

Local Media Gets Into The Spirit(s)

Increasingly, local TV stations are accepting liquor advertising.

It appears that the self-imposed ban on ads for distilled spirits is disappearing quickly and the industry is hoping the networks will follow suit.

"If the owned-and-operated stations are taking them, clearly the networks are seeing that it's just profit left on the table," said Frank Coleman of the Distilled Spirits Council of the U.S. New York Post (6/14)

With the huge cuts in auto ad spending and the closure of national retailers such as Circuit City, I have a feeling we will begin to see a lot of nontraditional advertisers on broadcast and radio in the very near future.

Drink Less? No. Just Drink Cheaper

Back in April, YouGovPolimetrix' Brand Index released a report indicating that four brands - Coors' Keystone, A-B/InBev's Busch, Miller Brewing Co.'s Milwaukee's Best and Icehouse - are so besmirched that the breweries should consider retiring them.

Now this from the The Wall Street Journal:

At a cost about $5 less per case than flagship brands such as Bud Light or Miller Lite, beer companies such as Anheuser-Busch InBev and MillerCoors are surviving the downturn thanks to rising sales of lower-cost beers, including Busch and Keystone Light.

Great quote from the story indicating why these brands are doing well.

Gillian Singletary, 24, of Los Angeles, has been buying more Pabst Blue Ribbon and Miller High Life and less Stella Artois and Pete's Wicked Ale. She said Blue Ribbon is seen as hip - in a retro way - at some L.A. bars.

"Drinking less doesn't really seem like the best option, so finding the cheapest way to drink is definitely one of my goals," said Ms. Singletary, a free-lance writer and executive assistant in the health-care industry.

I love this quote. It is a great illustration of the types of choices consumers use in making a purchasing decision. For this consumer, reducing consumption was not a viable choice. Selecting a less expensive alternative was the chosen path and with a stable of offerings at different price points, Busch and InBev are holding some of the business.

Not every brand will do well at every point in the business cycle. It is very important to remember the context of the economy and markets when analyzing research results and stated consumer choices. Otherwise, you might just kill off the product that would be your leading seller when the economy is down.