The opposites test

Roger L. Martin writing in Harvard Business Review:

“The senior team of a large player in the global wealth management business recently asked me for my opinion on their strategy. They had worked long and hard at coming up with it. Their “Where to Play” choice was to target wealthy individuals who wanted and were willing to pay for comprehensive wealth management services. Their “How to Win” choice was to provide great customer service across the breadth of their wealth management needs. I pushed and probed, but that was it.

Sadly, like the majority of strategies that I read, this firm’s strategy failed my sniff test and for that reason I would bet overwhelmingly that it will fail in the market as well. The test I apply is quite simple. I look at the core strategy choices and ask myself if I could make the opposite choice without looking stupid. For my wealth managers, the opposite of their “where” choice was to target poor individuals who don’t want and aren’t willing to pay for comprehensive wealth management services. The opposite of their “how” is to provide crappy customer service.”

Put simply, if the opposite of your strategic decisions look stupid, you have not really made a strategic decision. You will not be differentiated. And every competitor will have the exact same direction.

Repositioning the competition

Jim Carroll, writing on his blog:

“You may be going merrily about your business, doing a decent job, progressing steadily along the tracks. Your brand may be well regarded by consumers. Everything may be OK.

But then out of left field the competition does something radical that rewrites the rules; that reframes the market; that changes the way you’re viewed. Suddenly you no longer seem quite so relevant. You appear a little off the pace, a little out of sorts. Suddenly you look like yesterday’s brand.

BA was solidly respectable, thoroughly dependable. And then irreverent Virgin arrived on the scene and made it somewhat stuffy and old-fashioned. Levi’s was cool and contemporary. And then dissident Diesel appeared and made it safe and conventional. Orange made Vodafone feel corporate. Apple made Microsoft appear square. Sipsmith made Gordon’s look dreary. Fever-Tree made Schweppes taste sweet. Eat made Pret seem over-sauced. And so on and so forth.”

Positioning a brand can feel like an isolated exercise in an otherwise stable category.

But you are always doing more than positioning just one brand.

You are also repositioning a category.

This holds true if you use an ‘about’ approach or a ‘versus’ approach.

There’s a parallel to draw with politics here. The Overton Window describes the acceptable range of political views within a culture. When a new party finds traction at the fringe, they expand the window, and in the process shift the public’s perceptions of where the middle ground lies.

A new position changes all other positions.

Or as Dave Trott wrote in Campaign:

“When you position yourself, you also reposition the competition.”

Marketing’s attitude problem

Byron Sharp writing for The Ehrenberg-Bass Institute:

“There are a number of common misconceptions and they are often surprisingly damaging to marketing effectiveness – sometimes catastrophically so. Too many marketers, and market researchers, fall for what I call ‘marketing’s attitude problem’. This is where problems about buying behaviour – that is, not enough sales – are recast as brand image problems. So if the problem is ‘how do we encourage more recycling of rubbish?’ it’s recast as ‘how do we get people to care about the environment?’ Many brand plans argue that the reason sales growth hasn’t been as robust as desired is that the brand image is ‘not strong’ – whatever that means – or needs to be ‘updated’, ‘modernised’. The idea is that if we can just get people to see us differently, then sales will go through the roof. In reality, what’s holding back sales is that people hardly think of the brand; it’s seldom noticed, and not fast enough, and it’s difficult to buy. The need for differentiation is a related myth, as is the idea that brands sell to distinctive groups of people, or that it’s beneficial or necessary to target a particular group – and therefore not speak to other buyers.”

Market orientation

Mark Ritson, writing for Marketing Week, describes a fundamental problem in how marketing people think about the brands they work on:

“It turns out that, as marketers, we quickly start to lose the perspective of the market as we spend hundreds of days a year inside a company that is launching or managing a product.

We start to think the product is the centre of the world, not the customer that we are designing it for. We begin to assume the claims we make in the advertising are what the customer should care about. We start using dumb verbs like ‘convert’ and ‘educate’ to describe what we will do with our marketing rather than smarter ones like ‘listen’ and ‘serve’.

We go native, and the product cart starts to pull the customer horse. Even though there is a mountain of evidence and precedent that shows that the best way to make money is to find out what the customer is doing and wanting and then design products for them, we start making ‘innovative’ products in a vain attempt to change what they want and how they currently do things.”

This reminds me of Dave Trott’s telescope analogy:

“It’s like looking down different ends of a telescope. Clients, naturally, look down the end that magnifies the brand or the product. Until it takes up their whole world. But the consumer is looking down through the other end. Where the brand/product may be a tiny part, if it exists at all.”

Beach use of this misalignment, Ritson describes the first lesson a marketer should learn:

“A good marketer who is well trained will have been schooled in the discipline and will have started their training with extensive exposure to the concept of market orientation. It’s the bedrock theory of marketing and, paraphrasing somewhat, essentially points out that the first rule of marketing is that you are not the market. All your thoughts, feelings and immediate responses to things like advertising, price and packaging are not just incorrect – they are dangerous.

You help produce the product, ergo you are not the consumer of it. Learning to separate your own instinctive thoughts and feelings from the actual insights from real consumers is, literally, the first thing a trained marketer learns to do well.”

Later, Ritson shows how being more market-orientated leads to being more successful:

“We know from groundbreaking work by a host of American academics in the 1980s and 90s that the more market-oriented a manager and the company she works for is, the faster it will grow, the more profit it will make and the more successful its new innovations will be. It turns out knowing you’re not the customer bestows massive marketing advantages.”

COG Model of human motivation

Matt Willifer writing for APG:

COG has used neuroscience to identify the six – and only six – fundamental human motivations. That is the real emotional truths that get people to actually do something. If your brand can powerfully play to one of these then you’re in a good place.

  • Security: care, trust, closeness, security, warmth
  • Enjoyment: relaxation, fun, openness, pleasur
  • Excitement: vitality, fun, curiosity, creativity, change
  • Adventure: freedom, courage, rebellion, discovery, risk
  • Autonomy: pride, success, power, superiority, recognition
  • Discipline: precision, order, logic, reason

AIDA and the hierarchy of effects

From an article posted by APG Sweden:

The 1880s was the beginning of systematic sales processes. A company that sold calculating machines, The National Cash Register Co., invented a four-step formula for selling – get attention, provoke interest, create desire, and then get action by closing the sale (“AIDA”). The need to make face-to-face selling more efficient resulted in “salesmanship in print”, a term that would make Lord & Thomas the biggest agency in the world. Advertising was seen as a substitute for face-to-face selling, and as a rational, information-based process, with no room for humour or eccentricity. What is noteworthy was that all this happened before the concept of “marketing” was seen as an activity distinct from sales (the first university marketing course was taught in 1902).

AIDA was the first of many “hierarchy of effects” models. Other models are Daniel Starch’s (1920) read, understood, remembered, and acted upon and Russell Colley’s (1961) awareness, comprehension, conviction, desire and action.

James Webb Young’s Five Ways

Simon Clemmow writing in How To Plan Advertising:

“After a century or so of formal study, we still do not know how advertising works! This isn’t the admission of defeat it sounds; advertising is a craft, not a science, and asking how advertising works isn’t like asking how a bicycle works – it’s more like asking “How does literature work?“! Nevertheless, it’s very important to have a good grasp of the general theories that have been advanced and developed over the years, because they must all be part of our ‘mental furniture‘ when we’re defining the role for advertising.

‘Classic’ theories of how advertising works are mainly of the single-model kind; that is, ‘The way advertising works is this way’. These include AIDA (which states that Awareness is necessary and leads to Interest which is necessary before and leads to Desire which is necessary before and to Action); USP (Unique Selling Proposition, which depends on finding a motivating point-of-difference within the product); and Brand Image (which asserts that image is more important in selling a brand than any specific product feature, and that advertising works by ‘adding value‘ to the gestalt).

However, as early as the 1930s it was acknowledged that advertising could work in more than one way, and frameworks began to be constructed. The most enduring from that time is James Webb Young’s ‘Five Ways’ (1963), which says that advertising works:

  1. By familiarising
  2. By reminding
  3. By spreading news
  4. By overcoming inertias
  5. By adding a value not in the product

It is very easy to underestimate the value of these observations, and it wasn’t until the 1970s that most of the theory was developed which underpins our thinking today.”

There’s two important points made in this excerpt:

  1. Advertising is as much an art as it is a science.
  2. Advertising can work in multiple ways.

Fifty five years after James Web Young defined his ‘Five Ways’ and 21 years after Clemmow wrote this passage, I fear we still have not learnt these lessons.

Global, international and multi-national Account Planning

Rita Clifton writing in How To Plan Advertising:

For the purposes of this paper, we should probably define global as being the approach that starts out with the intention of standardising as much as possible across as wide a geographical area as possible. And international approach would be less ambitious, but would still seek to take a common perspective across markets. A multi-national approach is one where the main thing in common is company ownership, with perhaps just a sharing of insights and information on a co-operative basis.

Leaky bucket theory

Byron Sharp writing for the Ehrenberg-Bass Institute:

The leaky bucket theory suggests that companies are always losing customers, so to maintain share, you have to win an equal number of new customers to keep the bucket full, so to speak. To grow share, you have to be especially good at new customer acquisition, or you have to slow the leak.

The idea of plugging the leak became popular with theorists who sold the idea to practical marketers, who believed, without any evidence, that retention is cheaper than acquisition. The most extreme, and fanciful, example was from a 1990 Harvard Business Review article, “Zero Defections: Quality Comes to Services,” which alleged that the leak could be plugged for huge gains in profitability. Again, there was no empirical evidence.

In my book,  How Brands Grow, I emphasize a move toward customer acquisition. Many up-to-date marketers now accept the idea that gains in penetration are required for growth, so customer acquisition should be the emphasis of growth-oriented marketers. In terms of the leaky bucket theory, the emphasis has shifted from plugging the leak to accepting it. All brands lose customers, so the strategy is to work hard to fill the bucket with new customers at a faster rate than it leaks