Marketing Memos

I hate religious squabbles, like one recent war of words.  I speak not of invectives thrown concerning the inappropriate placement of a proposed mosque in New York, but a string of nasty words cast upon a private discussion group debating if the iPad is a real computer.

Zealots … they are never more fierce than in geekdom.

The group in question is an invitation-only cluster of former gurus involved with a now obsolete mini-mainframe system.  Each member is brilliant yet more opinionated than a lame-duck congressman.  Aided in part by a member journalist who once covered that mini-computer beat, and who now chronicles everything Apple, the group exploded into strings of sneering over the viability of the iPad for people who want to do work as opposed to consume content.

I think it started with a dig about USB ports.  Who knows.  The rhetorical blood flowed regardless of who fired the first stray round.

One segment of this group maintained that the iPad was not ‘good enough’ for people who wanted to do ‘serious work’, two concepts that are completely personal in nature and thus entirely subjective.  The marketing jockey of this group (me) noted that the iPad was designed for the content consumption market, and that anyone wanting to do more with it might need to look elsewhere (yes, it is my job to pour gasoline on smoldering embers).  The discussion rapidly devolved into one camp who maintained the iPad was an expensive toy and others who felt Gawd himself shat it.  Each team grabbed whatever proof points they could to bolster their case and slay the other side’s perception.

Perception is the game.

Political advisors often echo the age old sentiment that “perception is reality.”  If the majority of the population believes the sun will rise in the west, it will … until it doesn’t.  If you think “they are out to get you”, then you will behave as if they actually are (and even if you are not paranoid, they may still be out to get you).  What the market believes is what your brand will be, and this shapes people’s preferences.

Which is why Apple products sell so well.

Apple has mystique, which my dictionary defines as “a framework of doctrines, ideas, beliefs … endowing the person or object with enhanced value or profound meaning.”  In other words, brand based on perception.  When iPods were still new I encountered a grown man in a Best Buy store who demanded an iPod.  When I asked him why not a different MP3 player, he had no reason.  He knew nothing of the technical specifications, competing price points, or even what restrictions the iPod might place on his music listening existence.  But he knew he wanted one because it was “cool.”

Like Mojo Nixon said, You Can’t Buy Cool.

This brings us back to the iPad and market perceptions.  It may be unfair to think the iPad cannot be made to do useful work.  The growing stable of apps offer some tools for office-like productivity, and there is even a smattering of apps for geeks (though these seem largely restricted to cheat sheets for programming languages and some iPad-specific modeling gizmos).  But given Steve Jobs death grip on the iPad experience – almost Disney-like in its wonderland fixation – a perception exists and grows that iPads aren’t going to serve buyers who need anything above content (when I tried to find a separate email client to install on my girlfriend’s iPad, none could be had and Apple discussion groups pointed to a prohibition against such software).  This perception will keep certain buyers from acquiring an iPad.

And LG knows this.

Faster than a congressman can say “kickback”, LG noticed this market perception and cast FUD concerning iPad dysfunctionality.  A VP-level LG spokesdroid said “It’s going to be surprisingly productive.  Our tablet will be better than the iPad.”  Granted, for a product that has not seen daylight, these claims are as vaporous as Britney Spears brain.  But the fact that LG has seized upon the perception of what iPads cannot do shows how one can take perception and through PR try to make it reality.  “Honey, give the kids the iPad to watch movies during the trip to grandma’s.  I need the LG-Android so I can finish a proposal for work.”

Perception then is a weapon, either to make sales for yourself or prevent sales for your competitors.  Image caused Apple to sell 13 million iPads in under five months. Image also caused LG to try choking Apple’s sales flow until their Android pad enters the market.  Members of my techno guru group used either evidence to support their prejudice about the iPad.

The marketing lesson is that perception is imperative.  A brand undefined or undefended will cause sales to suffer.  Applied against a competitor, it can cause their sales to suffer.  Steve Jobs’ crew knows branding and we can expect a backlash as more Android slate vendors (Acer, Toshiba, Motorola, etc.) jump on the iPad perception pig pile.

Bookmark to:

Hide Sites

By “branding support” I am not suggesting that one apply a red-hot iron with rancher’s logo to the flesh of a technical support representative.  However, having worked ranch when I was a kid, and having recently experienced tech support, the thought has a certain appeal.

Your brand is created with every buyer interaction.  Some interactions occur in advertising.  Others occur between buyers and cut you out of the interaction loop.  The rest occur whenever your buyers visits your company, be it your web site, your sales office, or your support department.

The letter can destroy you.

Not long ago, Dell was flagging.  Part of this was a change in the market which they failed to anticipate and were also slow in responding.  Yet a good part of their fall from prominence was due to ill-advised shifting of technical support (something that had been a glowing aspect of Dell’s brand) to under-trained staff in India.  Many formerly loyal Dell customers became openly antagonistic, and this negative brand image was communicated from customer to customer.

Support as a brand touch point came sharply into focus for me last week as I encountered two completely opposite examples of customer service, or lack thereof.  In the case of Comcast, they tarnished an already inferior brand through indifferent and idiotic “support.”  Amazon, on the other hand was so superb in execution that their already strong brand became more so.

Comcast – casting doubts about their sanity

For someone in the high tech business, I’m a technology laggard.  There is not a single HD-TV in my home.  Needing to replace a failing low def tube, and deciding I might as well start down the HD highway, I emailed Comcast support with a simple question:  since I have to use one of your set top boxes to get HD, tell me which box(es) will you provide in my area so I can buy the best TV to use with it.

Eleven emails later …

The sundry exchanges could be considered comical were they not aggravating.  The first response said “I understand that you would want to know more about HD” and then provided a URL to Comcast advertising.  Sorry Kandarpa, not even close.  Interestingly, a different support agent who had the entire preceding email thread and saw my reaction to this odd substitute for “support”, gave exactly the same answer.

One fellow bordered on helpful, sending a list of links to their many different set top boxes, but did not identify the one used in my area (they are different in different areas because Comcast is rolling out different services on different schedules to different regions).  The rest of the emails resulted in a continuing lack of enlightenment until I said that I would document the email exchange for Comcast’s VP of marketing.  That threat (yes, threatening Comcast is about the only alternative) got a senior support slacker with two of more functioning dendra to clearly state that Comcast technical support had no way to know what set top boxes were issued by any office.  Period.

I worry about company that provides data services but cannot make data available to their own support teams.

One can (and I would) argue that such sloppy support can only come from a monopoly, which describes any municipal franchise.  Amazon, always mindful that they have no such government protection, goes further to protect their brand and service their customers.

Amazon – amazing affection

In the same week that Comcast was cascading down the canyon of doom (AT&T and possibly Google will soon run fiber to the premises here), I ordered a new cell phone from Amazon.  This surprised everyone given that I have been hauling the same smart phone the nearly a decade.  Being the frugal descendants of Scotts, I naturally opted for the cheapest shipping option available (free), but was surprised the next day when Amazon said the in-stock handset wouldn’t even leave their warehouse for five days.  I popped them an email and noted that out of simple curiosity I wonder why the delay.

Amazon sent a single, coherent, informative email about the mechanics of their order fulfillment system, apologized for my confusion, and upgraded me at no cost for two-day shipment to make sure I remained satisfied with Amazon.

Contrast the two – Comcast and Amazon.  The former clearly didn’t care enough to even try to answer a simple inquiry.  The later, having a more complex question to answer did so and then, at their expense, did something unexpected and downright endearing.  Comcast diluted their brand by forcing a soon former customer to battle their ineptitude.  Amazon hugged me into submission.

The marketing message is that you brand is impacted at every interaction.  Giving people reasons to dislike doing business with you is the pump primer for churn.  Hurry up AT&T and Google … you have a paying customer waiting on you.

Now, if Amazon started providing internet services to the home …

Bookmark to:

Hide Sites

I’m hoping for antisocial media.  I can see how to make a buck off of that.

Meanwhile, social media continues to gain dominance in marketing, and for good reason.  Humans, and even politicians, are social animals.  We commune for pleasure, profit and procreation (which pretty much describes a day in the life of Eliot Sprtizer).  Even the most sterile of pursuits requires some social aspect.  Every poor blogger, alone in his office, hammers out prose in order to asynchronously connect with other humans.

Business-to-business (B2B) activities are thus social interactions.  Oracle commits social acts when it interacts with other enterprises, aside from the select few it eats.  Thus social media should be a component of B2B. The oddest aspect of B2B social media concerns who in the relationship needs to socialize and why.  The failure to think through these two questions have led to various B2B social media catastrophes including most of the old executive blogs at Sun Micro.

Relationships, regardless of how tenuous, are the heart of social media.  Your B2B worries center on buyers, suppliers and thought leaders.  These are the primary external groups who are influenced by you and your competitors and thus the ones to which social media is important.

Just ask Oracle’s 28,918 Facebook fans.

When stripped bare, social media for business is mainly about branding.  You need people to perceive your company and products in a particular way.  Social media offers the ability to communicate brand both directly and personally.  The personal aspect is what creates an emotional connection with a human (politicians, having no souls, have no emotions).  B2B social networking is mainly about the communication, amplification or defense of your brand.

Brand communication: At the risk of repeating myself … again … if you do not define and consciously communicate your brand, the market will, and the market is unkind.  Social media’s personal touch gives tremendous opportunity for communicating brands.  Sadly most companies treat the opportunity as advertising, which some people perceive as an antisocial assault (ever notice the advertising you remember most are those that entertain and make you feel).  Any employee (including the CEO) who communicates in social media needs to do so only after reciting your internal brand statement ten times.  Once the brand is reloaded into memory, any social media communication will reflect that brand.

Brand amplification: Often members of an audience will correctly state your brand.  Such acts deserve acknowledgement, appreciation and rephrasing what the other person said with your specific branding words.  Doing so clarifies and amplifies your brand in public places.

Brand defense: Other folks are not as kind, and may have many nasty things to say about your products, your company and maybe even your mama.  Left unchecked, these can escalate into a negative brand image.  Some companies are proactive, and upon seeing a negative comment help the person to resolve their problem or explain why it has to be.  Other companies (most notably the self-destructing Intuit) either ignore community outrage, or worse yet try to censor negative branding.  Social media has to be treated as an opportunity to connect.  As you would with friends or family, treat the other person well.

The hard part about B2B social networking is finding or establishing relevant places to participate.  Proactive companies create social media spaces, be it a Facebook fan page, a public forum based around their market or segment, or even private executive panels.  Many marketing dilatants hijacked these sites for promotional purposes, and rapidly killed the value originally promised.  In more mature markets where social media arose from the masses (such as within trade or technical interest groups), enterprises have joined as members.

The take-away is that your suppliers and your buyers are people and need to be treated as such.  Online social media is merely a rapid extension of normal social interaction.  Since social media is global, asynchronous and everlasting, even B2B businesses need to incorporate it into their overall marketing plan.  Just understand that social does not mean sales, but it does mean social.

Bookmark to:

Hide Sites

When does a brand become detrimental to a company?

Ask Google. They are having a relatively rough time with their brand this week.

Google encountered trouble during the corporate equivalent of a temper tantrum. When they discovered that someone in China (presumably the government) had hacked into Google’s network and spelunked through dissident emails, Google threw a hissy fit. Executives at the all knowing Google failed to know that the government of the People’s Republic of China (PRC) remains one of the most ruthless around. Google should have known this since Google helped the PRC censor Internet information in order to (according to the PRC) “Properly guide Internet opinion.”

Kinda evil, eh?

Google’s brand started dissolving. In Google’s infancy, they adopted an informal corporate motto of “Don’t be evil.” This kindly directive even found its way into Google guiding manifesto “Ten things we know to be true”, a creed that doubled the simpler tradition established by Bill and Dave, of Hewlett and Packard fame, and their five item “HP Way”. On Google’s top ten list is the ideal that “You can make money without doing evil.” The cynics (realists) among us recognize this isn’t a prohibition against doing evil things, just a recognition that it isn’t essential.

The problem was that Google and their admirers amped-up the “don’t be evil” mantra into a core branding element. Google employees view themselves as not evil. Their admirers have nominated Google for digital sainthood. The population in general bought this part of the brand …

Through ignorance they ignored Google’s complicity in Chinese censorship, which is evil.

It was Google’s reaction to being hacked by their partners in civil liberties crime that dinged the Google brand. When Google threatened to cease censoring searches in Shanghai, people asked “Why are you censoring now?” Adages for doing no evil collided with evidence of doing evil. A core and central aspect of the brand was t-boned by reality.

Foremost, brands must be authentic, or at least branding lies must never be discovered. Take used car salesmen … somewhere … please … preferably to the free side of a cliff. Our common perception of these snaky lemon squeezers is opposite of how they sell themselves, as trustworthy and helpful enablers of transportation. The brand they promote conflicts with your perception of them while you stand on the highway shoulder waiting for a tow truck. He sold you “Honest Bill’s Used Cars”, but you now want to buy large caliber ammunition instead.

Honest clunkers. Don’t be evil, but censor.

When composing your brand, you had better base it on something impregnable, lasting and real. Reality is as consistent as gravity and tends to have the same terminal impact. Base your brand on something authentic and that you can keep authentic. Don’t be evil and don’t be a used car salesman.

Bookmark to:

Hide Sites

“Bottoms up” is not just something you say during cocktail hour or at a strip club. It is a market strategy as well, and Google will implement it with a fist full of dollar bills.

News of a Google netbook operating system – Chrome OS by name – has emerged. Targeted for netbooks running ARM and x86 chips, COS centers Google’s Chrome browser as the interface to the world and to Google applications. This latest Linux distro is designed to address the bottom of the commercial computing market (we’ll ignore the One Laptop per Child gizmos that would otherwise win the Barrel Bottom Scraper Award for underpowered PCs).

Scott McNealy understood half the equation when in an over-caffeinated frenzy said “The network is the computer.” Naturally McNealy saw the hardware side of the system, being that he was in the hardware business. But as any technology marketing maven will maintain, it is the apps that sell the hardware.

Google is all about the apps.

Restate McNealy’s maxim for software and you get “The Internet is the app.” Google search is arguably the most popular app on the Internet. Their desktop applications … not so much, but for low-end users they are plenty.

Low-end users like netbook buyers.

Now that Google apps (Docs, Gmail, Maps, etc.) can operate offline, and given that Google’s browser can be tweaked to enhance these offline apps, Google has all the components for customer lock-in or delight, depending on how un-evil Google really is. Non-power users who want a computer for the most mundane uses – people for who Open Office is overkill – could easily exist using Chrome OS, Chrome Browser and G-apps. This is probably 80% of the market.

I’ll take an 80% segment any day.

The open marketing question is “what hardware vendors would ever use COS?” Industry analysts assess the low end Microsoft tax on netbooks to be about $20 a unit when XP is deployed, or about 7% of the cost of the cheapest netbook available today at CompUSA. $20 may not sound like a lot to you or me because it is a one-time cost. Some industry estimators expect 35 million of the little laptops to be built this year. The Microsoft tax would rack-up nearly three quarters of a billion dollars, which is serious money to hardware vendors or anyone outside of the Obama administration.

Smart money is betting that Google will ask only a nominal, fixed partner fee for joining the COS party. Pay a few grand to gain access and your hardware company is alleviated of the Microsoft tax. Assuming that the brand of operating system is irrelevant to the average netbook buyer, netbook builders are looking at a few extra million dollars a year to pad their 201Ks (which were 401Ks before the recession).

Google’s goal then becomes monetizing the user, not the OS. Tech pundits predict that advertising will be Google’s approach. This may well be. The evil half of my brain (which in full disclosure actually occupies more than half my cranium) sees a million ways of inflicting advertising on unwary netbook buyers. Most methods however are intrusive, unwelcome and exactly what Google will not do. Chrome will not force people to endure Google ad pop-ups, or permanently scrolling banners on the top of the screen (besides, netbook screens are too small to waste on banner space).

Brand and first choice in external interactions is where Google gains, advertising revenues following online. Google is creating a 100% Google environment and a go-to brand. When netbook users wake in the morning, their lives will revolve around the Google OS. Add Google browser, add Google desktop applications, add Google search (built into everything), ad nausium. It is a completely interconnected and Internet driven brand. Microsoft came close to this when indoctrinated info workers adopted Microsoft Office atop a Microsoft OS.

It was Microsoft’s overriding strategy that both gives Google opportunity and may require Google to cede it.

The question is if Google must open the OS in order to compete. For all Microsoft’s faults (a list that is slightly longer than War and Peace and a Hugo Chavez speech combined) it understood that the application sells everything else. The network is the computer, the Internet is the app, the app is everything. When there is a market leading application, Microsoft supports it then clones it. Microsoft has always entertained, encouraged and even funded developers to assure that the next great app – whatever it may be – will be under development somewhere. Microsoft always wants the Next Big Thing to run on Windows first.

If Google closes COS, it will enjoy only limited market penetration. People slightly more advanced than monkeys – anyone who has not created permanent couch indentations – will eventually want to do something on their netbook that Google has not provided. Google’s desktop toolbar is not a digital Darwinian ecosystem. Gadgets are insufficient. Google will open COS in order to expand.

Just don’t expect it in version 1.x. Google knows not to invite unnecessary heat, and will keep COS locked while it matures and takes complete ownership of the low end of the market. After that beachhead is secure, they will open, expand and become a serious threat to Microsoft.

Bookmark to:

Hide Sites