I'll take 'Competitive Sets' for $200, Alex

We all tend to get a tad myopic when it comes to our particular categories of expertise. Our brains are imprinted with the complete insider's road map, with all of the associated jargon, acronyms, reputations and rules of thumb of a battle-worn soldier. It is all too easy to find oneself disconnected from the way consumers view the marketplace. The ante is raised in a recession since we're all fighting for a share of a wallet that isn't growing. But who exactly is our competition? This is an important question because it frames a marketer's world view, how we apply our limited resources, and the manner in which we react to changes in the landscape.

Certainly we all know our direct competitors-- the list of players that sell related products and services at similar price points. We know the leaders, the second tier challengers, the upstarts, and the fading stars. No doubt, it is highly important to track the behavior of this group, the shifts in tactics and strategy, product development, etc.-- not only is it vital to measure up head-to-head with the right comparative advantages, it's also critical to be tuned into what our customers are seeing.

But we also know that there is an entire world outside of our category that affects our prospects for success. After all, most consumers aren't disciplined enough to rigidly categorize their household budgets akin to the way we segment the market... "this is my clothes money, this is my new car fund, and this is my going out money..." It's more likely that most people operate off a fairly fluid household budget-- with perhaps the greatest deviation separating must-haves (e.g., mortgage payment, school tuition) from the nice-to-haves (new laptop, gym membership). So in reality, if we're both targeting the same household, on some level we are all competitors, regardless of what we sell. This is an easy dynamic to accept at face value, but it's rather unactionable in the abstract. We are tuned into competition with direct competitors... the world of winners and losers in a defined space. But how do I keep up against... everybody? How and where do I address that in my marketing plan?

I think we have to go back to examining the purchase process. For illustrative purposes, let's throw up a generic purchase funnel. I know many regard this particular tool as antiquated-- frankly, since no purchase process or consumer is quite the same, there can really be no perfect model anyway. For example, the braintrust at McKinsey recently drew up a new model, dubbed The Consumer Decision Journey, that resembles a loop that actually grows bigger prior to becoming smaller-- this after reportedly researching the purchase behavior of some 20,000 people. While that theory makes as much sense as anything, I'll refer to this classic model for purely illustrative purposes.

The basic premise is that there is some kind of trigger that ushers a would-be consumer into a purchase process. There are, of course, people that do nothing but study how to manufacture these types of "triggers," but putting that aside for a minute... this is the stage where consumers become aware of the choices available to them. The theory is that over the course of this process, which can take anywhere from 3 seconds to 3 years depending on the category, a consumer acquires more information that breeds familiarity, allowing them to formulate opinions, a consideration list and, eventually, a hierarchy of preferences. The consumer then shops their preference(s) and consummates the purchase, at which point they enter the ownership experience, which ideally will produce loyalty that will draw them into repurchase at a later date.

If we believe this, then we'd have to also believe that there are various questions that need to be satisfied along the way for the consumer to advance to the next stage of this process, such as:

So I think the question one has to ask themselves is: Where am I engaging my prospects? I currently work in the restaurant business, and like other industries many in my tribe automatically start at the middle or even lower in the funnel-- we assume anyone we talk to is in the market to dine out now... and to be fair, statically this is a good assumption since more than 90% of consumers surveyed report a restaurant purchase in the previous 30 days. So the theory goes, people have to eat, with the overwhelming majority dining out at least a little, so let's get right to competitive advantages and deals, mano y mano with my direct competitors.

And while there's obviously a huge role for this kind of focus in a marketing plan, this is also, undoubtedly, the most vicious and contested area of the battlefield-- where all brands go to fight. And I can't help but wonder why, as marketers, who are ostensibly trained in the art of differentiation, why we don't spend more time and resources at the top of the funnel. I mean, by the time consumers reach the theoretical consideration stage, haven't the criteria largely been defined by our competition? And another thing, isn't the whole point of a "funnel" that the playing field gets smaller farther down in the process by way of hefty consumer and brand attrition? If so, one could argue that there are more fish-- albeit not all qualified-- at the top of the funnel, and thus potentially the opportunity to circumvent the bloodbath further along in the process.

I suppose this is just the age-old branding vs. retailing/selling argument. How much time and resources should I invest against defining my worth to a broader audience, where I am competing against a virtual universe of consumer choice versus the resources I invest selling to consumers who are actively shopping my category? Heck, do I have what it takes to create the process trigger in the first place? I think that's the ultimate shot at creating new customers streams, and defining the rules of engagement in the purchase process. But in doing that we step out into the real marketplace, the world outside of our competitive set where consumers make daily trade-offs among products and services of all stripes.

Let's go back to my category. As a restaurateur, who am I competing with at the top of the funnel? A hair appointment? Savings to be applied to a future family vacation? The electric bill? A car wash? Dry cleaning? Isn't that what real people are debating when they think about whether to go out and eat?? Makes sense to me. Yet with the possible exception of fine dining you rarely see restaurant companies engaging consumers at the higher levels, where they are still sorting out their needs-- as in, why should a person dine at my restaurant now rather than divert those resources to these other things? What need can I tap into? Perhaps...

• Time away
• Romance
• Stress relief
• Awakening of the senses
• Laughter and frivolity
• Conversation
• Family bonding
• Social status

None of these necessarily involves a deal, and it gives me an opportunity to offer a trigger that can steer the purchase process into areas where my restaurant holds a competitive advantage, allowing my natural brand strengths to be aligned with the needs I have identified. They allow me to steer the fat part of the pie into a mini purchase funnel of my own creation, so perhaps it ends up looking like this:

Crude drawing aside, the idea here is this trigger of my own creation, invented by tapping into a need against a broader world of consumer choice, has the potential to circumvent the bloody purchase process of my competition, and accelerate a consumer to my restaurant because they have entered the purchase process on my terms. I think no matter the economy, a company with designs on superior growth tracks must put resources against this type of activity.

So for example, a Mexican restaurant can certainly run ads in places showcasing a new combo meal or outdoor fire pit or something, but why not invite a consumer with dreams of traveling to Mexico to experience the next best thing?










T.G.I. Friday's can certainly fight it out for cash-strapped casual dining consumers with its "Right Portion, Right Price" campaign, but why not also a call out to the woman who hasn't had a rejuvenating girls-night-out in months because the bar scene is so disappointing?

Or I just loved this guy drinking what looks to be Sonic float-- grabbed it from a Jet Blue online promotion actually, but it could have been a premise for a great ad. So many things in life are beyond our control, including the lot you draw in the coach section. So grab something in life that you can control, like the happiness that is the always enterprising Sonic menu.

In a recession, I think the middle/bottom funnel "sellers" win at most companies, hands down-- those wishing to allocate at least some marketing resources towards tapping into core consumer needs, with the goal of creating purchase triggers leading to new streams of customers, are on defense. We hear, marketing needs to "work harder" these days, which is code for making deals and direct, brass tacks selling points. Additionally, the discussion is generally dominated by reactions to the behavior and activity of direct competitors. I really believe this is a zero sum game that too many companies play, and causes the entire category to move like sheep. What insiders see as major lines of distinction... "but we offer fries at $1.99, and ours come with ketchup AND ranch!" ...to consumers it all looks ordinary and forgettable.

So my point? My point is I think we need to spend appropriate time thinking about our indirect competitors at the top of the funnel, addressing the questions that customers pose at this stage of the purchase process. I think we need to exit the myopia of our direct competitive set from time to time and look at our offering with the fresh eyes of our consumers-- not only does this avoid engaging in category groupthink, but it allows us some respite from the margin-crunching world of throwing discounts at a finite group of shoppers. I believe these will be the companies poised to leave the pack of sheep in the dust when this great recession finally subsides.

Steve Jobs, a.k.a. The Natural

I'm one of those people that loves studying the naturals-- the select few who marry hard work with a dash of genius and tremendous charisma to set themselves apart from the rest of us. I love trying to extract the magnetic tendencies that make them special, like a scientist in search of the Higgs boson. Who's on my list? I think of people like the late Carl Sagan, who popularized the modern understanding of the universe and earth's relation to the cosmos. Or Tiger Woods, child prodigy at the age of 2, winner of 14 majors, who combines effortless power with pure unflappability to both dominate and elevate a sport. Or even somebody like Rick Warren, author of the über-bestselling devotional, The Purpose Driven Life, a book that launched a new wave of spiritual awakening by flipping the old self-actualization movement on its head.

There are others (and not all guys, of course... J.K. Rowling, Oprah Winfrey, etc.). They're the game changers-- not just because they're smart and talented (there are many smart people), or because they're visionaries (we all stumble upon a unique insight now and then) with larger than life egos-- but because they seem to be almost hardwired with the ability to connect with and inspire people, both inside and outside of their profession. This gives them that coveted crossover appeal, the ability to transcend a category. Put Steve Jobs on this list. The guy is a marketing natural, someone who sees simplicity in the complex, and instinctively understands how humans prefer to interface and collaborate with machines and one another.

Jobs is also a master presenter, and a communications coach by the name of Carmine Gallo recently wrote an entire book on the supposed secrets of his trademark style, summarized in this recent Business Week article. So needless to say I was pretty interested. And as I read it, the broader marketing and branding lessons were obvious-- no surprise, since a presentation is, after all, just promotion, one of the 4 Ps. So... I give you, Gallo's 5 secrets for presenting and promoting like a marketing natural, followed by a few comments and observations:

-- 1. A headline. Steve Jobs positions every product with a headline that fits well within a 140-character Twitter post. For example, Jobs described the MacBook Air as "the world's thinnest notebook." That phrase appeared on his presentation slides, the Apple Web site, and Apple's press releases at the same time. What is the one thing you want people to know about your product? This headline must be consistent in all of your marketing and presentation material.

People relate to narratives, and brand building is, really, just telling an ongoing story about your brand's purpose in the universe. And that story needs chapters with headlines-- which are often your products and services. And just like you wouldn't bring something to market without a sound business case, so also should you have a succinct consumer case that summarizes its core benefits, competitive differentiation and link to your brand's... raison d'etre. Summarizing a complex idea in a few words is one of the most value-added things a marketer can do because it sets the table for alignment, giving teams from marketing communications, training, operations (among others) a common language and understanding, which makes a company vastly more fleet footed and competitive.

--2. A villain. In every classic story, the hero fights the villain. In 1984, the villain, according to Apple, was IBM (IBM). Before Jobs introduced the famous 1984 television ad to the Apple sales team for the first time, he told a story of how IBM was bent on dominating the computer industry. "IBM wants it all and is aiming its guns on its last obstacle to industry control: Apple." Today, the "villain" in Apple's narrative is played by Microsoft (MSFT). One can argue that the popular "I'm a Mac" television ads are hero/villain vignettes. This idea of conquering a shared enemy is a powerful motivator and turns customers into evangelists.

There's a little more to the story here I think. You can only position a competitor as a villain or a bogeyman if the case can be made they that they are both powerful and a menace to consumers-- otherwise it just looks like nerdy Coke/Pepsi-type bickering. And you have to simultaneously position yourself as the white knight. In other words, you have to behave like a classic challenger brand to pull this off, the pageantry of David taking on Goliath. If consumers see your cause as authentic and honorable, and your competitor(s) as disingenuous or disreputable, you'll engage them at a far higher, more emotional level, which is usually a good thing. And I believe even mega-sized corporations can effectively position themselves as challengers so long as they pick the right villain-- which could be a competitor in an unsustainable position (think McDonald's/Dunkin vs. Starbucks) or a befuddled establishment (Southwest vs. The Airlines) or a rigged status quo (Ross Perot vs. 2 Party Rule). America loves a populist.

--3. A simple slide. Apple products are easy to use because of the elimination of clutter. The same approach applies to the slides in a Steve Jobs presentation. They are strikingly simple, visual, and yes, devoid of bullet points. Pictures are dominant. When Jobs introduced the MacBook Air, no words could replace a photo of a hand pulling the notebook computer out of an interoffice manila envelope. Think about it this way—the average PowerPoint slide has 40 words. In some presentations, Steve Jobs has a total of seven words in 10 slides. And why are you cluttering up your slides with too many words?

Most of us learn this rule of presentation early in our careers-- less is usually more. We see others bomb with cluttered powerpoint slides, print ads, television spots and the like, and we chuckle... "that'll never be ME, hardy har har." And yet, for whatever reason, we'll turn right around and commit the same cardinal sin ourselves. I think it's because, in the moment, we have soooo many pieces to the puzzle in our minds that we're dying to communicate, so many selling points and lines of rationale that we're aching to get off our chests, that we just can't help ourselves. It takes discipline and contemplation to whittle it down to the fundamental building blocks. At the end of the day, most people aren't as close to it as you and won't stomach 25% of what's in your brain, they have their own lives to reconcile-- so lead with your best material and let the Q&A, leave-behind or website clean up the details.

--4. A demo. Neuroscientists have discovered that the brain gets bored easily. Steve Jobs doesn't give you time to lose interest. Ten minutes into a presentation he's often demonstrating a new product or feature and having fun doing it. When he introduced the iPhone at Macworld 2007, Jobs demonstrated how Google Maps (GOOG) worked on the device. He pulled up a list of Starbucks (SBUX) stores in the local area and said, "Let's call one." When someone answered, Jobs said: "I'd like to order 4,000 lattes to go, please. No, just kidding."

This is related to point #3. People just don't have much of any attention span anymore. We are essentially ADD Nation at this point (no offense to folks who suffer from actual ADD). Yet in order to be memorable, you have to be retained-- and to be retained, you have to entertain. And I believe you cannot entertain without taking some risks and mixing it up in communications-- many times of the unscripted variety, which allow people to get to know you. Jobs likes the hands-on show & tell... sure, something could go wrong, so what? Reel them in. Or maybe it's allowing consumers to post content on your website, which might be negative ((gasp!!)). We are in the era of open-source innovation... iPhone applications, Mozilla software, Wikipedia-- consumers want to feel like participants, not passersby. It's amazing how many companies still want to do highly controlled, one-way conversations these days, as if it's the 1950s and we're all newbies to commercialization.

--5. A holy smokes moment. Every Steve Jobs presentation has one moment that neuroscientists call an "emotionally charged event." The emotionally charged event is the equivalent of a mental post-it note that tells the brain, Remember this! For example, at Macworld 2007, Jobs could have opened the presentation by telling the audience that Apple was unveiling a new mobile phone that also played music, games, and video. Instead he built up the drama. "Today, we are introducing three revolutionary products. The first one is a widescreen iPod with touch controls. The second is a revolutionary mobile phone. And the third is a breakthrough Internet communications device…an iPod, a phone, an Internet communicator…an iPod, a phone, are you getting it? These are not three devices. This is one device!" The audience erupted in cheers because it was so unexpected, and very entertaining..

This is where the dash of genius comes into play. It's more than a provocative headline or creative premise or nifty animation. It's master showmanship, the great reveal of the big idea in a completely unexpected and refreshing way. Great promotion leads the consumer to the emotional crescendo that carries the key takeaway. This becomes, as Gallo characterizes it, the proverbial mental post-it note that the audience retains.

Gallo closes by stating that Jobs always couches his pitches in dreams and experiences. This is just a matter of evolving rational brand benefits to higher level emotional needs or meaning. DeBeers says "A diamond is forever"...Olive Garden says "When you're here, you're family"...Walmart says "Save money. Live better." Compete on the highest playing field possible, and it becomes a rallying cry for your employees and customers alike, and allows you to define your space in the marketplace.

So there you have it... narrative, pageantry, single-mindedness, engagement, emotional crescendo of the big idea. Steve Jobs. We can't become naturals, but we can fake it by taking good notes and self-assessing our own practices.

Michael Jackson, and lessons for brand building

If the Michael Jackson brand were a stock traded on an exchange, can you imagine the volume of buy orders on the night of June 25th? Here was a guy that had long since moved past train wreck status-- past radioactive ... he literally couldn't purchase relevance unless it came in the form of an open window into his bizzare existence. So deep was the chasm between Michael Jackson, the entertainer who once left us spellbound, and Michael Jackson, the creepy pauper, that only his actual death could bridge the gap. If this past weekend's box office was any indication, consider the chasm officially bridged. In fact the New York Times reported last August that his estate had already earned $100 million from the film deal and other merchandising contracts, with another $100 million anticipated by year end.

Of course this isn't all that unusual in the world of arts and entertainment-- an artist's death, particularly one of unnatural causes, can often drive his or her popularity to unprecedented heights. After all, the original king, Elvis Presley, is still alive and well as a cash machine over 30 years after his death. He and John Lennon both sold more songs after their deaths than they ever did alive. Artists like Van Gogh, Basquiat and Gauguin all saw the value of their works soar posthumously. Author and naturalist Henry David Thoreau and poet Emily Dickinson, both obscure and reclusive in their day, achieved critical and popular acclaim in the years proceeding their deaths. This is well worn pattern spanning generations of Western civilization.

So I guess we know the "what," but the "why" is more interesting to ponder-- as in, why is something worth more dead than alive? Certainly, basic supply and demand is a factor here, namely, death = scarcity. A finite supply of an artist's work should trigger a jump in price, all things being equal. And then there's the matter of simple differentiation-- a death obviously creates separation and uniqueness for an artist in the public's consciousness, allowing them to catapolt above the pack of the living. Maybe nostalgia for a bygone era? That could be part of it too.

But scarcity, differentiation and nostalgia still don't explain it all away for me. I mean in the case of Elvis we're not just talking records, it's Graceland, t-shirts, key chains, impersonators in Vegas, the whole 9 yards. Elvis was lampooned in his final years, now he's revered as an American icon. Before I get too morbid here, I guess the question I'm getting at is what exactly causes this change--besides the obvious-- and what does it tell us about brands?

I think the key is need. When an artist is dead, they don't need us anymore. When we perceive something as needy, we want to know why-- and in our cranial shorthand we infer that they must not be in demand. This applies to anything -- including friends and colleagues. That guy always hanging out in your office, doesn't he have anything to do? Doesn't anyone need him? He must not be very good. Or that girl with the crush on you for a million years, why hasn't she found anybody yet? What's wrong with her? Dead artists and entertainers don't need us anymore, and that suddenly makes them irresistible.

Comparing brands to people is very instructive to me because, well, that's what we try to do in marketing-- create desirable brand personalities, which is equity on your balance sheet-- it's what allows us to charge more than the sum of raw materials for a product or service. Great brands have a soul, a lifeforce. And we relate to them much like we relate to people, which is, of course, why we all work so hard on branding ourselves professionally.

Take President Clinton for example. His first 2 years in office were, by all accounts, a political failure. He suffered from the sharpest plunge in popularity among elected presidents-- down 11 points between the 1st and 2nd quarters of 1993. From the teasing he endured for the McDonald's runs and the $200 hair cut, to the more serious policy stumbles, he made plenty of beginner's mistakes. But more than anything, the guy was simply in our face too much. He was too damned needy. After seeing his party suffer a humiliating defeat in the 1994 midterm elections, one of the keenest bits of advice he received by advisers was to simply go away more often, be seen less, get off peoples' TV sets and leave them wanting more. I believe this went a long way toward restoring his brand esteem in the eyes of public as he easily won re-election 2 years later. Sure it was about being more Presidential and the whole "triangulation" thing, but it was also simple branding fundamentals-- sometimes less is more.

Time to bring this baby home... My point is, the Michael Jackson phenomenon underscores some important lessons for brand builders, namely, that it's important for a brand to avoid coming off as overly needy to consumers. Neediness makes people question a brand's worth. To put it another way, a great brand projects confidence and success. A great brand is comfortable with who they are, where they came from, and what they value.

Let's try to be more specific... how might this manifest itself in real-world marketing behavior? A few of my examples (among dozens, no doubt):

-- A confident brand doesn't cram 17 selling points on an advertisement, particularly on a B to C communication. Look, nobody's going to read all of that crap anyway, and it comes off as a prosecutor's brief rather than overture to consumers. Just pick a central narrative, perhaps a few key supporting statements, and let the copywriter go home for crying out loud. Like this ad for instance-- it's not about vanity, it's about freedom of expression. Well done, BOTOX geniuses.

-- A confident brand doesn't seek every and any opportunity to discount itself. Yes, I know the economy blows and you need the traffic, but you give away a little piece of your equity every time you sell yourself short. If you must discount, try to disguise them-- bundle several items together, add a bonus service or upgrade or a free gift, offer a reward for loyalty-- whatever, but confident brands don't repeatedly undercut their value perception by slashing prices.

-- A confident brand does spend the majority of its marketing resources on its core users, and has faith that they will, in turn, spread the gospel to secondary and tertiary targets, which we all know is the best advertising money can buy anyway. In the case of Trader Joes, those resources are directed right into their own stores, where easy-going, Hawaiian shirt-wearing staff troll the aisles, engaging customers in all manner of conversation about their private label offerings... want to know what something tastes like? No problem dude, let's crack open the product and try it! And another thing, I've always maintained that people look to advertising even after a purchase for affirmation, which, of course, also fuels word of mouth and repeat purchase-- if they see a disconnect with your placement or presentation, it runs the risk of confusing and alienating them, which makes you just another sellout.

-- A confident brand does seek opportunities to connect with its core consumers in ways that don't necessarily involve a direct sales pitch. Embrace their lifestyle. Be with them, enjoy what they enjoy, and demonstrate how your brand strengths connect with their values and interests. One of my favorite examples of this is the famous Red Bull Flugtag, a traveling event where people compete for distance as they launch themselves off a pier on their own self-powered flying machines. Talk about an event that projects the spirit of the brand "that gives you wings."

-- A confident brand does avoid copying its competitors. While there are certain benchmark criteria in any category-- basic product and service offerings or procedures that are essential for credibility as a player-- a confident brand also recognizes a pack of sheep moving in one direction and smells an opportunity to make a provocative statement. Just look at the fun Southwest Airlines is having at the expense of its competitors and their gotcha bag fees. Is there any wonder why Southwest has been one of the gold standards in the airline business for at least 15 years?

Now don't misunderstand me here, we're not talking about snobbery-- unless that's an intentional element of your brand's DNA. You don't want to go so far as to present your brand as aloof, as if your customers are practically unworthy of your products and services, and your obligation to them almost beside the point. That's obviously the wrong lesson. But you do want to project confidence and success, and you do want to try and leave them wanting more-- a feat that doesn't always require a near-death experience to pull off.