SEPTEMBER 24, 2009

A colleague recently sent around a very interesting BusinessWeek piece about the efforts companies are making towards restoring public trust in their brands. It was, I thought, a great look at how McDonald’s, American Express, and Ford are tackling the core problem of distrust in an era when largesse, recklessness, and complacency among major corporations have led to a financial panic and recession.

While McDonald’s and Ford have primarily improved their public standing by actually improving their products, American Express’ story, I thought, was more interesting because its products aren’t exactly tangible. It, primarily, is in the business of moving money around - a valuable, essential service - but the extent of the average consumer’s interaction with AmEx involves swiping a card at the grocery store and paying up at the end of the month.  The same is true of all credit card companies, really.

So traditionally credit card issuers have competed at the margins. Credit cards are more or less functionally identical, so companies had to lure new customers by touting perks like the security of their cards (AmEx “Blue” cards),  the quality of their customer service (AmEx platinum cards), or the ubiquity of card-accepting merchants (Visa). AmEx even benefited from a false underground rumor of an exclusive “Black” card issued only to celebrities; in response to the rumors, the company actually started issuing a similiar “Centurion” card in 1999. Rewards like cash back and airline miles are other competitive battlegrounds for issuers.

But given the new austerity of the recession and the leeriness of consumers punch drunk from commodity bubbles,  financial panics and record unemployment, AmEx needed a new marketing tack. So it turned to the stalwart of American business mythology - the yeoman entrepreneur, repairing bikes and baking bread in once-vacant storefronts across the nation.

As someone with an entreprenurial bent, I love the ad. I really, really do. I’m incredibly inspired by stories like these, where an economically beleaguered place like Detroit, thanks to plummeting costs of living, attracts artists, entrepreneurs and other risk-takers to rebuild the city. My escapist fantasies usually revolve around moving to places like Baltimore or Cleveland and participating in their ongoing rebirth.

AmEx is right to run campaigns like these on two levels: first, as an emotional matter, I think most Americans are kind of like me - we envy the freedom and the boldness of entrepreneurs, and alignment with those virtues is never a bad thing. But on a more substantive level, the only surefire way to improve America’s moribund corporations is to enable small businesses to mount challenges to their dominance, and American Express’ fate is directly tied to the health of the broader corporate sector.

I would have liked to see more substance in the campaign, though. What concrete actions is the company taking to improve small business’ access to credit? Is it working with Chambers of Commerce in places hard-hit by the recession to offer business tips to would-be entrepreneurs? How else is it promoting OpenForum, its online resource for small businesses? Is it working with governments to remove barriers to business creation? You never find out.

So, big business - if you want my trust, don’t try to align yourself with my values, or sell me on your brand image. I want to know exactly how you can help and what you’ll do in the event you fail to help. Information that doesn’t accomplish one of those two things just isn’t particularly relevant.

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JULY 22, 2009

Last year I saw a cool story on how Nintendo was using a unique approach in marketing their gaming consoles to women. They held “Nintendo parties” where groups of women got to play games, drink some wine, and munch on some hors d’oeuvres. I thought it was a cool idea, targeting groups of women in a low key social setting has been done to sell everything from tupperware, to make-up, to even sex toys.

Recently my friend LiLu over at Live It, Love It got to throw such a party. She got an e-mail from Brand About Town and next thing you know she and 25 of her friends were off to a “Girlfriend’s Guide to Gaming” bash. They got to try out the new Nintendo DSi and ended up receiving one to take home and enjoy.

What makes this such a great move for Brand About Town and Nintendo is natural buzz that followed afterwards. It only took a couple of days before all of our friends were talking about it. My blogger pal Liebchen attended the party and couldn’t put the DSi down all night:

“Before I knew it, it was almost 9pm and I was still bent over the little device, trying to get to the next level of Dr. Mario. God help me when I finally get more games on this thing; someone might have to stage an intervention. For instance, if I were to get Mario Kart…I used to think that video games were something that you grew out of. I’ve never been so happy to be wrong.”

This is the kind of word of mouth you want surrounding your product.

What makes these events so valuable is the chance to connect with the consumer in a casual, low-key setting and allow them to test drive your product. Liebchen didn’t fully realize what the Nintendo DSi was all about until she picked one up, “I still liked playing other people’s games, but didn’t figure I needed one of my own but the DSi…it was just fun the games were fun; the camera; all of the capabilities I didn’t really know how much it could do.”

A great way for Nintendo to reach out to those outside the typical video gamer demographic, in fact I could easily see this model transferring over for different kinds of products. The key is to keep it casual, make it fun, and make it about the consumer.

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JULY 13, 2009

Via PC World comes the release of a new study by The Leading Question, a UK media strategy company, showing that illegal file-sharing among British teens has decreased by close to 33%. 26% of teenagers admitted to illegal file-sharing in the last month, down from 42% in December 2007.  Not only that, for the first time in the survey’s history, the data show that purchased music downloads outpacing illegal file-sharing.

The study’s authors suggest that the decrease in illegal activity has come partially due to the increasing popularity of legal, paid options, but also the pervasiveness of music streaming sites like Spotify, Pandora and YouTube.  Streaming sites have seen enormous growth, not only because of the risks of illegal file-sharing, but also because of the increasing ubiquity of wireless data services - with devices like the iPhone, streaming is possible from anywhere, making downloaded, local copies of music more or less obsolete. Throw in the computing industry’s recent trend toward netbook computers, with their tiny hard drives, and you have a whole lot of factors creating a greater market in online streaming, making the greater prominence of these services not too surprising.

I’m encouraged by the study as a music lover. But I’d offer some words of caution to record execs who think people are finally turning away from stealing their intellectual property: the terms you’re offering to sites like Pandora are more or less killing the streaming business model. Pandora’s announcement last week that it will begin to charge heavy users of the service has, anecdotally, driven quite a few people away - even if they can afford the very small surcharge that Pandora will ask of those who listen more than 40 hours a month. I definitely listen more than 40 hours a month and can afford it, but why should I pay, when there are countless alternatives?

Pandora power users have an enormous level of interaction with the service. We generally sit and rate tracks as they play, to improve the content of our personal stations. I even have a keyboard shortcut on my laptop for doing just that,  so I don’t have to switch windows to rate songs. This should give marketers an incredibly rich data environment with which to discern our likes and dislikes. You’d think that, to simplify things a bit, if Pandora’s algorithms notice a huge number of 24 year-old guys giving good ratings to both Weezer and Mariah Carey songs, that that might be an incredibly valuable piece of data for a record executive, who could then find or create an ironic nerd-rock band with a mezzo soprano lead singer - even using the Pandora service to introduce the band directly into our headphones.

If this occurs to me, as someone well outside the music business, it has to have occurred to the pros in New York, LA and Nashville. I wonder what’s keeping it from happening. But one thing’s for sure - the costs imposed on streaming sites by the music industry will ultimately end in those sites becoming less prominent, sending people right back into piracy.

As an aside, I discovered my new favorite song, Metro by the Vincent Black Shadow, on thesixtyone, a new site that makes music streaming into a kind of video game. I don’t know how to explain it better than that, so you should probably just check it out.

(image is of the basement of Plan 9 Records in Richmond, VA - my favorite record store growing up)

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JULY 9, 2009

A few months ago, I moved to a new apartment, and with new apartments come all sorts of fun stuff like turning on utilities, paying security deposits, and scheduling a time (always between 10 - 2 or some other ridiculous window) for the cable guy to come.

So Comcast came, dutifully between 10 and 2, and attempted to install my cable. “Attempted” being the operative word - after about 45 minutes of fruitless effort, including significant help from me, my installer left, unable to finish the job. I went back to work, disappointed, then came home and did it myself with software I downloaded from the Comcast website.

You can imagine my surprise when I got my bill a few weeks later, complete with a hefty installation fee - for an installation that never happened, and that I ultimately did myself!

Unfazed, I got in touch with Comcast customer service via Twitter and complained about the fee, and it was refunded within 24 hours or so. “Great customer service!” I thought. “Why don’t more companies do this?”

But after thinking about it for a while, I wonder whether that these social media presences are really a solution to anything. I think we should really ask ourselves who’s being served by the Twitter accounts and Facebook pages set up by customer service departments. Yes - my concerns were addressed almost instantaneously, and without the usual rigmarole of 1-800 numbers typical of megacorporation customer service. But according to the Pew Internet & American Life Project,  broadband penetration varies wildly between different demographic groups in America. So, for instance, while 83% of Americans with bachelor’s degrees had a home broadband connection when surveyed this April, only 30% of senior citizens, 35% of low-income Americans, 46% of rural Americans and 46% of African Americans did. In addition, a stunning 85% of upper-income Americans had broadband access at home. These differences may have become more stark since broadband costs have increased: in a year where we’ve experienced slight price deflation, the price of broadband has risen 13%.

The correlation between the popularization of social media and broadband adaptation is not accidental.  Social media sites are often bandwidth-heavy and more or less require high-speed internet to be fully functional. Others, like Twitter, may not be bandwidth hogs but are much more useful if you maintain constant interaction with the service - something dial-up doesn’t do well.

I’m concerned that by embracing social media channels for customer service, companies might be inadvertently creating a two-tiered system for customers with problems - one, for wealthy and well-educated customers, that’s effective, friendly, and responsive, and the other for everyone else. From personal experience, the difference between @comcastcares and 1-800-COMCAST could not be more stark. One’s a pleasant, sometimes obsequious exercise in customer satisfaction; the other is bureaucratic, confusing, often unfriendly and occasionally flat-out wrong. I don’t know whether the people behind the @comcastcares account are higher up on the food chain than their phone customer service brethren, but they seem more empowered to refund money and deal with complaints. It bothers me that people like my grandparents, who live in the country, don’t have bachelor’s degrees, and are senior citizens, don’t have access to that same system.

I think efforts to provide better customer service are laudable, but they should at least attempt to be technologically-neutral. If I can get my problem resolved quicker on Twitter, make it so that your reps on the phone can do the same thing. Of course, efforts to make broadband more widespread and less expensive wouldn’t hurt, either.

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JULY 2, 2009

It’s a unique experience to be on the other side of what you do for a living.

One of the things I enjoy most about my job is the chance to help clients engage social media - find a way to connect with bloggers, twitterers, and other groups online in a way that’s engaging, informative, and sometimes even fun. We’ve had the opportunity to help plan many great events - everything from roundtable discussions over dinner to trips to company facilities - but last weekend I got to be the recipient of someone else’s planning. It all started with a typical afternoon on Twitter…

I’ve followed the Southwest Airlines (@southwestair) account for the past several months and had talked with them a few times about my flight experiences and how the heck you ever get the first boarding position. (I think it’s impossible.) However, no previous tweet had ever caught my attention like this one did:

I was lucky enough to see it 20 seconds after it posted so I responded and received a congrats message just a few minutes later. Over the next 48 hours, Christi Day, who works in emerging media for Southwest, sent me some additional info about the trip including flight times, hotel, etc.  On Saturday afternoon we showed up at BWI ready for a random adventure - and that’s exactly what we got: New York-themed gate area, complete with Frank Sinatra singer, balloons, buffet, and gift bags; the most fun I’ve ever had on a flight - a trivia contest, in-flight commentary, and champagne; transfers to and from our great hotel in Times Square; and interactions with lots of enthusiastic Southwest employees who obviously love their jobs and their company. They made the experience memorable without making us feel like we were part of marketing campaign. (Check out fellow passenger TheRobStory’s photo set on Flickr.)

My husband had never flown Southwest and was blown away by the entire experience. To say he’s been converted to a Southwest fan would be an understatement. Looking back, here’s what I think made this campaign so successful:

• Great opportunity: Who doesn’t want to go to NYC for the night? And, who isn’t going to tell everyone they know about it? We told at least 50 people about our experience, each time mentioning Southwest Airlines and LaGuardia, which was the entire goal of this effort. This doesn’t include all the people who saw our updates on Twitter and Facebook.
• Genuine fit: It’s an airline - giving away a free trip make sense.
• Passionate people: As I mentioned above, I was very impressed by every employee I interacted with, from the marketing staff to the pilots. Each conveyed a sense of enthusiasm and passion for what they do. You can’t help but want to be a part of that. I feel better about a company when people love to work there - to me, it means that Southwest is about more than just making money.

Beyond Southwest, here are a few other companies whose recent Twitter promotions stood out to me. And, while the ideas may seem simple (give away free stuff), they have attracted my attention - and I’ve talked about each of these companies positively offline because of what they did on Twitter, which I have to believe is the ultimate goal of any campaign:

• Orbitz - Followers eligible to win a free roundtrip airline tickets when they retweeted an Orbitz message.
• Maggiano’s -Offered $100 gift card to any of its restaurants.
• Baskin Robbins - Holding a cake trivia contest every afternoon in July, winner takes home a free ice cream cake.

Attracting attention and keeping it are two different things, so I look forward to seeing if these companies over the next few months continue to put their Twitter accounts to good use. Maybe giving away free stuff seems like a cheap ploy to attract attention, but the bottom line is that it works. It might not work forever, but it works for now. And once these companies have crowd following them, the next challenge is how they continue to offer value. I think this is where bigger picture concepts, like the ones Chris Brogan offers, come into play. Any other Twitter campaigns that have stood out to you lately?

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JUNE 25, 2009

We’ve written a lot recently about crisis communications and social media, including setting out six key steps for how companies can use social media in a crisis setting. One of those key steps is to establish - and use - social media channels before a crisis hits. This has many benefits - an audience has already been established; dialogue with key influencers is ideally already underway; and, most important, precious minutes aren’t spent worrying about setting up accounts and establishing handles once the crisis hits.

On June 16, the FDA issued a warning that more than 130 people had reported losing their sense of smell after using Zicam cold remedy products (gel and gel swabs). Matrixx Initiatives, the manufacturer of those products, has withdrawn them from the market.

According to PR Week (registration required), Matrixx has been using pre-existing social media channels to communicate with consumers about the FDA’s report. Specifically, Matrixx has been communicating about “the importance of consumer safety, what steps consumers should take, the research behind the product, the company’s compliance with the FDA, and the fact that Matrixx is willing to share its data with the FDA.”

In addition to a video from Zicam CEO Bill Hemelt on its home page, Matrixx is using Facebook and Twitter to address the situation and reassure customers. Those channels were already in use before the crisis hit, and provided an excellent way for Matrixx to get its message out - quickly. Twitter in particular has provided an extremely effective way to respond individually to Twitter users who have expressed concerns about the product. While this kind of response is time-consuming, it can go a long way toward neutralizing criticism and allaying fears.

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JUNE 8, 2009

It’s a known fact that women play a very important role in decision-making in the household– including decisions about new purchases.  MediaWeek published an article on this very topic in February, analyzing a report which consisted of two rounds of polling (one before the current financial crisis, and one afterwards).

Results of the polls:

• 74% of women are “primarily responsible for buying groceries and basic supplies” today, and 55% say they are “primarily responsible for paying the bills.”
• Half of the women surveyed said they “love to shop” but have been holding themselves back to reduce the stress of overspending.
• Also, when asked about stress management strategies, 54% said staying in the budget helps them stay calm and “paying cash only for purchases” helped 31% of them.
• Of the women polled, 59% say they are worse off than they were a year ago.
• The scary part: 57% are worried they will run out of money.

No matter how you look at the results of the poll, it’s clear that businesses should take notice if they want to survive the economic downturn.  Understanding women’s financial styles, concerns, coping mechanisms, and needs is absolutely crucial for targeting them as an audience and as an important part of the economy and marketplace.  Helping allay financial concerns, offering exceptional value, and being aware of the financial pressures women are facing today are three smart strategies companies can adopt when reaching out to this demographic.

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MAY 20, 2009

Call me old-fashioned, but I still prefer to go shopping at an actual store – not online.  I would much rather see/touch/examine what I’m buying before I have it shipped (and I’ve had too many bad experiences with returns).  Yet, I still research products online before heading to the store, to make sure it’s even worth leaving the house for.  Recently, I found window curtains I loved on a store website and was so excited about them until I noticed a bad review (it still amazes me what people actually take the time to review).  And, now, I’m struggling to decide if I should listen to the person I’ve never met or buy the curtains! That got me thinking about how much people allow consumer review sites to influence their decisions.  I read just the other day that Google has now tweaked its searches to pull more from sites like Yelp and LinkedIn.  According to Business Insider, “The idea is to improve people searches and searches for product reviews. Results from reviews sites will now include snippets from actual user-reviews.” 

Consumers have always asked friends and family about products, but, now, frequently rely on perfect strangers, as well.  Yelp, a user review website, boasts that it has over 10.6 million people access its website each month.  In a USA Today article, a chiropractor in LA said he gets 80% of his business from online reviews!  Morning News Beat reported on a shopper survey that stated:“Seven out of ten survey respondents said that they check online product reviews before actually purchasing things, and 62 percent said that they spend at least-a half-hour online each week specifically reading consumer product reviews.” 

Before working at TMG, I used to work for a company similar to Yelp, and working there made it easy to see how important good reviews are to companies.  Customer review sites are forcing businesses to listen to consumers.  Companies that frequent these sites will know what is being said about their products, how to fix any problems, and validate their customer’s concerns.  It’s just another way companies can show that they’re listening. 

Now, would you buy the curtains, or heed the reviewer’s advice?

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MAY 11, 2009

 A few weeks ago, I was talking to Dan McGinn about the recession and how it has been affecting society in general. He asked me, “What changes have you made in your life since the recession hit?” At first, I really couldn’t think of any. I have a lot of fixed costs - mortgage, nanny, car payments, tuition - and there hasn’t been a lot of leeway for making cuts in my budget. I was embarrassed to admit that I couldn’t come up with any sweeping reforms on the home front that show that I’ve adjusted to the new financial reality.

However, I’ve given it some more thought, and in retrospect, I do have an answer. It’s not as simple as “I cancelled cable” or “I am growing my own vegetables,” but I have realized that my spending habits have changed in more subtle ways that belie my own sense of financial insecurity. For example, I had two weddings to go to on the same night earlier this month. In the past, I probably would have gone out and bought a new dress. Instead, I borrowed one from a very fashionable co-worker.  I hosted a birthday party for my kids over the weekend, and in the past I might have rented some tables and chairs to accommodate the brood of five year-olds who came over to celebrate. Instead, I sent out a broadcast email to my friends and collected enough tables and chairs to seat everyone.  I was also just invited to my first clothing swap party next month - and I can’t wait to see what free fashions I come home with.  Finally, I’m trying to pay cash for purchases these days rather than whipping out the plastic, for fear of running up balances on my credit cards that I might have trouble paying off.

These may all be incremental steps, but the overall effect is clear - I am scared to spend.

Last week, Roddy wrote about the ways in which the economy - and specific industries - have changed due to the recession.  But how have individual consumers like me reacted? It appears that I am not alone. A recent Counting MyPennies blog post points out that there has been an increase in the number of people writing and reading about personal finance and living frugally - clearly an indicator that learning how to save money is on a lot of peoples’ minds.

And I enjoyed this analysis from Real Simple of a poll it conducted earlier this year.  According to the poll, some trends have emerged:

• People are staying in instead of going out - 37 percent of respondents are cutting back primarily on eating out.
• People are spending less on others - 24 percent reported that they are buying the same number of gifts, but spending less on them.
• Cutting coupons is becoming much more widespread - 38% of respondents have started using coupons since the economy took a nosedive.

I realize that none if this is surprising or particularly earth-shattering. But again, I think that these examples collectively illustrate a fundamental reining in of our spend-happy, consumerist society. The question is, when the economy bounces back, how long before this new financial discipline starts to erode? Is this a permanent shift, or just a situational response? Time will tell.

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MAY 7, 2009

Nothing beats feeling appreciated, and receiving a quick “thank you” is, more than often, all it takes. When I put a lot of thought into a gift for someone and don’t even receive a thank you for it later, I admit that I get very disappointed. Now, don’t get me wrong, I’m not one of those people that gives in order to receive - I don’t expect a handwritten note or a big production. But a simple “thanks” said aloud is all I’m really looking for. Knowing that someone liked what you gave - or at least appreciated the thoughtfulness - really makes me happy. Apparently many others feel the same way…

The people at smart USA — the car company that famously makes their cars so tiny you could fit two of them in a standard parking space– have recently experienced just how much people appreciate being thanked.

To reward those who had faith in the company early on, patiently waited for their cars to be produced, and bought vehicles, smart USA sent “Emergency Kits” to buyers. These kits each included a thank-you letter and three $5 gift cards to use at well-known coffee, gas, and book retailers. This cost the company a total of $492,440 because it sent kits to every purchaser of the 25,000 cars sold in 2008. The campaign has proven so effective, smart USA plans to keep it around. In addition, the company has chosen not do any traditional advertising.

The director of communications for smart USA, Ken Kettenbeil, thinks that mail has more power than any other media. Ken says, “We have received a lot of positive (consumer) e-mails forwarded from our dealers. We’re getting people thanking us for sending them a thank-you gift.”

With the economy as bad as it is and consumers changing their spending habits and being more selective in their purchases, the “little things” just may be make the difference. If you’re a company, reconsider investing the time (and money) into thanking your consumers for their loyalty. There’s something to the phrase: a little goes a long way.

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