State Farm is Where???

August 12, 2008

By John Furgurson

A couple years ago, when my kids were just 9 and ll years old, the subject of insurance came up at the dinner table. God only knows why.

My kids could recite — and often sing — the slogans of every major insurance company in the country. They had been exposed to so many commercials, they knew ‘em all…

“Nationwide is on your side.”

“Like a good neighbor, State Farm is there.”

“You’re in good hands, with Allstate.”

Prudential. “ Like a rock.”

As a parent, I was a aghast. As a branding professional, I was amused, and a bit curious. Why would the insurance companies spend millions advertising on the Disney Channel and on ABC Family? At first glance, it seemed like a lot of wasted exposure.

Then I think about my own experience, and it sort of makes sense.

My parents were insured by State Farm. My wife had a State Farm agent when we got married. It never occurred to me to look anywhere else, and we’ve never had a compelling reason to change.

Insurance is one of those low-interest, out-of-sight-out-of-mind service categories that no one really wants to think about. I’d rather have a root canal than deal with insurance of any kind. And that’s why those early branding efforts are so important… once they have ya, they have ya.

We’ve stayed with the same insurance company for almost 20 years not because State Farm has good service or great rates. Not because we’re loyal to our agent, who lives 120 miles away and never speaks to us. It’s because we absolutely hate the thought of switching.

It’s like brand loyalty by default. Life, auto, home, boat, cabin… We’re all in, and the hassle factor of changing insurance carriers is just too much to even contemplate.

But that was before we ever filed a major claim. Before our little winter disaster.

It always snows a lot in the Oregon Cascades, but January 2008 was crazy. The garage/shop at our mountain cabin eventually collapsed under the weight of 10 feet of heavy, wind-packed snow. It was a total loss, to the tune of about $60,000.

Naturally, we called our agent. Her assistant put us in touch in contact with a claims adjuster, and for the first time, we realize that State Farm is like two separate companies. The independent agents who set up the policies and collect the money have nothing to do with the claims adjusters who pay money out.

For 80 years, State Farm has branded itself as a neighborly, down-home sort of company that would be there for us, if we really needed ‘em. That’s the perception they’ve spent millions to maintain.

The reality, however, is quite different indeed.

The lady who’s supposed to be handling our claim definitely didn’t get the memo about being a good neighbor. In fact, any goodwill that State Farm has built up with us over the years went right out the window with just one claim.

It’s been seven months, and they haven’t even finished cleaning up the disaster area. Our neighbors are not happy. State Farm is going to cover the loss, eventually, but the process has been painful at best. When we called our devoted agent to complain, we got nothing but excuses and second guessing.

I can’t even imagine what the Hurricane Katrina victims must have gone through. The State of Mississippi finally had to sue State Farm to get them to pay the claims due.

Talk about a PR debacle. Instead of looking like a good neighbor, State Farm came out of that storm looking like an evil, corporate giant that could care less about the little people. I’d love to know how much market share they’ve lost since then.

There are two important morals to this saga:

1. When it comes to branding, actions speak louder than words. You have to be very, very careful about promising something in a slogan or ad campaign that you can’t deliver day in and day out. Fifty years ago, State Farm probably could deliver on their promise. But not anymore. Today, State Farm is country’s largest home insurer and in the top 30 on the Fortune 500 list, It’s too big to be a good neighbor.

2. Branding is not just a function of the marketing department. It’s also an operational issue.

State Farm’s operation is totally out of alignment with their brand. The sales side and the claims side are not operating from the same playbook, and State Farm can’t fix their problem by changing their tried and true slogan. They have to change the way their claims division works in order to live up to that slogan. They need to align the experience with the brand promise.

A tall order, no doubt.

Brands have always been about trust, and promises kept. For me, State Farm betrayed that trust. The behavior of one claims adjuster was so “off brand,” I’m ready to start the long and painful process of changing insurance companies.

I think.

If anyone knows of an insurance company that doesn’t operate like two separate entities, let me know. And if there’s anyone out there who works for State Farm and would like to expand on this, please do!)

Posted in ADVERTISING, BRANDING, CASE STUDIES | 4 Comments »

Positioning — It’s not what you SAY. It’s what they THINK.

July 23, 2008

By John Furgurson

In the 1970’s Al Ries and Jack Trout popularized the concept of positioning. Since then, they’ve written dozens of books between them and have made a fortune on the speaking circuit.

Still, you could have a roomful of MBA’s and no two would agree on what positioning really means. Many people can’t even decide if the word is an active verb or a proper noun.

Most people think of positioning as a simple step ladder. The cheapest, lowest-end products are “positioned” at the bottom of the ladder, and the best, most expensive products are on the top shelf, if you will.

But positioning has little to do with real price or quality. Instead, it’s all about perception.

The whole concept of positioning is based on the simple fact that we form opinions about products and companies based on our own perception. These opinions are influenced by all sorts of things… word of mouth, personal experience, individual prejudices, blogs, the marketing efforts of the particular companies and a hundred other factors.

In our own minds we make some pretty broad — and often rash — assumptions about things. Call it consumer bigotry if you want to. The fact is, we pigeon hole companies and products the same way we pigeon hole political candidates.

As marketers, our goal is to tap into these existing perceptions and use them to our advantage.

Here’s a classic example. Back in1968, before the term positioning was ever invented, the makers of 7-Up scored a huge coup in the soft drink market.

Taste tests and other forms of consumer research revealed that people saw 7-Up as a refreshing alternative to colas. Respondents said it flat out… “it’s a nice change from all the cola I’ve been drinking.”

So the 7-Up executives decided to market the drink as the alternative to cola. It was a no-brainer, really. They simply took the existing perception in the marketplace and turned it into their strategy.

From a positioning standpoint this worked remarkably well for several reasons. First, it didn’t attempt to change anyone’s perception. It simply leveraged the existing public opinion.

Secondly, it effectively repositioned the competition. Without slamming them, 7-Up lumped Coke, Pepsi and RC all together in a single boring category of colas.

Finally, the new strategy made 7Up relevant to the young people who account for a large portion of soft drink sales. The campaign tapped into the prevalent anti-establishment mind set of the late 60’s. It actively encouraged defiance against the cola establishment and portrayed 7-Up as a symbol of dissent. The entire campaign summarized the popular values of the public and catapulted 7-Up into the position as the third leading soft drink in America.

Like all good positioning strategies, 7Up’s was simple and almost painfully obvious. Once the executives at 7-Up knew what consumers were thinking, there was no other way to go.

The creative execution of the strategy, however, was not so obvious. J. Walter Thompson’s simple two-word slogan “The UnCola” said it all. The campaign gave the product a personality, cemented the idea in our collective consciousness, and assured 7Up a place in advertising history.

While it is possible to build a positioning strategy around images alone, it’s usually a few simple words like “The Uncola” that solidify things in the consumer’s mind. Because you don’t “position” a product, you communicate its position.

“Just Do It” communicates Nike’s position as the shoe for serious sports. “Pizza Pizza” is a fun way to communicate Little Ceasar’s low-price strategy. “Avis, we try harder” communicated the benefit of being number two in the rental car business.

On the other hand, many automobile companies have struggled to find the words that capture the public perception of their brands. Oldsmobile, the now defunct GM brand, is a good example.

In its last 14 years, Oldsmobile floated no fewer than ten different slogans. Here’s a few of the real gems: “Olds Quality. Feel it.” “This is not your father’s olds.” “Demand Better.” “Look what happens when you demand better.” “Defy Convention.” “It knows the road.”

Ironically, the slogan that’s most memorable is the only one that even hints at the reality of Oldsmobile’s perception with American car buyers. “This is not your father’s Olds” used the old, fuddy-duddy perception of Oldsmobile and spun it in a positive way. Maybe if they’d have stuck with it for more than a year, the brand would still be alive today.

You wonder what kind of research Cadillac executives did that led them to believe they could compete with Honda and Toyota in the small car market. The Cimmeron failed miserably back in the 80’s. Then they’re tried again in the 90’s with Caterra, “The Caddi that zigs.” Now they’re trying to compete against BMW, Audi and Mercedez, with little success.

This is a classic case of force-feeding a product into a position in the market. But Cadillac as a sporty car just does not compute with the American public. It goes against everything Cadillac has ever stood for. The world’s biggest, most luxurious SUV is one thing, but we’ll never buy the concept of a small, sporty Cadillac.

On the same vein, Porsche is way off track trying to compete in the SUV market. The Porsche of SUV’s has a nice ring to it, but it will never really resonate with the public that sees Porsche as a rich-man’s sports car. What’s next, Chateaubriand at McDonald’s?

There’s an important distinction to be made here between niche marketing and positioning. Cadillac can decide to focus on the luxury sports car niche and can build a car specifically for that purpose. But that does not mean the product will ever be perceived that way in the minds of the consumer. The problem is, Audi and BMW already occupy that space in the consumer’s mind.

Here’s another trap that many companies fall into: They mistake their mission statement for a positioning strategy.

Fortune-500 companies miss the boat all the time on this. There’s a giant health care provider that recently formed an internal committee to study the “position” of the company and draft a “positioning statement.” What they came up with was a mission statement at best.

But your mission — your statement of purpose — may have nothing to do with your position in the market place. And vice versa.

A mission statement is concocted by a committee and exists in corporate brochures, annual reports, and press releases. A positioning statement is formed in the consumer’s mind. A mission statement is the rose-colored view of your company. A positioning statement is the gritty, 16mm view.

No doubt, the semantics of positioning can get confusing. But if you want to hedge your bets, think of it this way:

Postioning is not something you do, it’s something that happens. You can choose a narrow market niche, devise a new pricing strategy and launch a giant ad campaign that, together, may affect people’s perception of you. But you can’t technically “position” anything.

Posted in BRANDING, CASE STUDIES, FEATURE ARTICLES | 3 Comments »

Put some meat in your marketing messages.

June 25, 2008

by John Furgurson

Every year, millions of dollars are wasted on advertising that is well-produced, but not very well thought-out. Kind of like a supermodel… nice to look at, but there’s just no substance there.

I was talking with a restauranteur the other day about this very subject. No, not the models. He had retained an ad agency to help promote his launch, but after our hour-long conversation, he had talked himself into never going back.

The agency in question produced a website, some print ads and a slogan without having a single, meaningful conversation with him about his business. If they had, they would have known that this particular business owner didn’t understand his own brand.

He has a beautiful restaurant with an impressive interior and outstanding cuisine, but he has no story to tell. No clear idea of what his core message ought to be.

Instead of an ad agency, he should have hired someone to help him figure it out… Before he paid for a slogan and a campaign that “doesn’t really fit this place.” Before he paid a top-name architect to design the interiors. Before he ever trained his servers or developed the menu, he should have known what his establishment was “all about.”

Easier said than done!

He and I did more quality thinking over one cup of coffee than he had ever done with his agency. And he’s not alone. A recent article in the Harvard Business Review shows that the majority of VP and C-level execs don’t know their company’s strategy. Or at least they can’t verbalize it without launching into a long-winded spiel about “value-based planning and linkage for a strategy of diversification of the company’s differentiated asset portfolio.”

Huh????

Little Ceasar’s is a far better example. Their strategy is simple: Sell value. Two-for-one pizzas, to be exact. And the best part is, they communicate that simple strategy in a provocative way: “PizzaPizza.” (I’m sure you can hear that quirky voice in your head just by reading the words.)

That’s their story, and they’re sticking with it. Google it and you’ll see those two words, right up front in the search results. It was the fastest growing pizza chain in America last year.

The payoff for a clearly defined and well-written strategy is clear: You won’t run pretty ads in the wrong publications. You won’t change directions every year, just to be fashionable. And you won’t have an on-line marketing effort that doesn’t jive with the rest of your branding.

Bottom line… you’ll be more focused and efficient in everything you do.

But how do you get there? In most small ad agencies, strategic planning is done by the seat of the pants. Account executives rely on industry info provided by you, the client, and on their own gut instinct. They’ll tell you that “great creative work begins with sound strategic thinking” but then they’ll just jump right into the sexiest part of the project… the creative execution.

For ad agencies, strategy is not a deliverable.

It’s understandable, given the prevailing perception: Most business people think of strategic planning as a left-brained activity. But ad agencies are enclaves of right-brained, creative thinking, therefore, you can’t possibly get a brand strategy from them.

Traditional thinking says you need a consulting firm for that. But consultants don’t handle execution of their own strategies. They leave that in the client’s hands, who then turn to their agency. So there’s often a disconnect between the strategy and the creative output.

What’s more helpful is a sensible combination of both services from one team: Strategic insight and disciplined execution. A left-brain, right-brain, one-two punch.

That’s how my firm approaches it… insight first, THEN execution.

No amount of creative wizardry will save a marketing campaign that lacks a strong, well-defined sales premise. That’s why we put so much emphasis on message development and front-end strategic issues.

We believe that sound advertising begins with creative strategic thinking. In other words, right-brained thinking is just as important in the strategic planning process as it is in execution.

“You can be swimming in data and still have nothing to really go on,” says Laura Neidhart, who runs our research division. “The real trick is knowing what questions to ask, reading between the lines and connecting things in creative new ways. That’s where the real, game-changing insight comes from.”

Setting aside time for some productive strategic thinking is the most valuable thing you can do for your business. And it’s not about spreadsheets, it’s about story telling.

Chances are, you’ll need help. You’re too close to the situation. Too consumed by the quarterly numbers. Or just too darn busy.

So find someone whom you trust. Block out a day, get out of your office, and think it through with your most trusted advisors. Look at everything you’re doing, and ask yourself this: what is this company really all about? What’s the message of substance behind your marketing? Is your brand all beauty and no brains?

Back in the early 80’s the Wendy’s fast food chain successfully married their strategy with brilliant creative execution. The strategy was value. The idea was that Wendy’s offered more hamburger for your money. The spot featured a little old lady named Clara Peller.

Watch it, then ask yourself the same question about your business: “Where’s the beef?”

Posted in ADVERTISING | 6 Comments »

Please, not another image of your “friendly, courteous staff.”

May 27, 2008

How stock photos can hurt your brand image.

by John Furgurson

How many times have you heard this cliché on a local radio ad… “our friendly, courteous staff is here to help with all your _______ needs, blah, blah, blah.” Chances are, you changed the channel before they could finish the sentence.

Crummy stock photos have the same effect on people. How many times have you seen this image on a corporate website?

It’s the classic, customer service visual cliché, and it’s just as bad for business as the blather you hear on weekend radio commercials.

Unfortunately, images like this are a dime a dozen in Powerpoint presentations, company websites, corporate brochures and annual reports. iStock Photo alone now has over 3 million images to choose from, and they only cost a few bucks apiece.

At my firm, our art directors work really hard to avoid the milk-toast visuals that are so prominent on low-cost stock photo sites. Unfortunately, clients often question the custom photography line item in our proposed budgets.

They think the perfect photo’s just waiting to be downloaded for 99 cents.

“Stock photos don’t tell a story. That’s what makes them so universally appealing,” says Senior Art Director, Eric Haag. “For those photographers, it’s just a volume game… they want their images to sell a hundred times over, so they make ‘em as generic as possible. In that case, a picture’s definitely not worth a thousand words.”

The question is, do you really want to hang your hat on a photo that’s already being used by hundreds of other companies, including your competitors? Or do you want a compelling image that will help differentiate you from everyone else?

Mike Houska, commercial photographer and owner of Dogleg Studios, says easy access to so many images is both a blessing and a curse… he’s selling more stock photos (rights-managed) but the assignment work is harder to come by.

“The royalty free stock images are so cheap and easy to get, it’s pretty much eliminated all the low-end and middle budget work,” Houska said.

“Back in the day, buyers had to comb through a bunch of giant stock catalogs, then call the stock company to do a search that may or may not turn up something. It was a hit and miss proposition at best, and the shots weren’t cheap. Now, in a matter of seconds you can have a hundred images that fit your criteria. They’re not great, but they’re close, and that seems to be enough for a lot of people.”

Let me pose this… does “close enough” fit with your corporate culture or your personal approach to business? What would happen if the engineering department just said, “oh well, that’s close enough”? Does that sort of mediocrity apply to other areas of your business, and if it does, how’s that working out for you?

The fact is, your brand image should be just as important to you as the quality of your product.

The last couple weeks I’ve been involved in an on-going photoshoot for a client of ours. It’s a country club — a cliché just waiting to happen. There are thousands of good stock images we could use:  The guy on the tee, holding his best Tiger Woods follow-though. Smiling, happy couples clinking their wine glasses together. The dad and his son, bonding while walking down a lonesome fairway.

Yawn.

There’s nothing compelling or unique about any of ‘em. Nothing that will lead the viewer into the shot or tell the unique story of this particular club. They’re the type of stock photos that won’t offend, but they won’t impress either.

So we’re not using any of ‘em. We’re setting up every shot with painstaking attention to all the details that make custom photography worth every penny.

Not your typical Country Club cliche

I believe that successful brands are built on three things: credibility, relevance and differentiation. Stock photos can hurt you in all three areas… If you’re trying to convey a message of quality, your credibility goes right out the window with a cheap stock shot. If the shot’s used by anyone else, differentiation is out of the question. And there’s nothing relevant about an image that’s designed to appeal to a mass market of consumers age 25 to 54.

So the next time you’re thinking of throwing another stock photo into a presentation or report, stop for a minute and ask yourself this: Will this image add anything to the story I’m trying to tell here? Does it convey a specific idea, or is it just a vague reminder of a general concept?

Is it just another visual cliché, like the good-looking customer service rep with the headset?

If it is, dump it! Either spend a lot more time refining your search, or hire someone to get the right shot for the job to begin with. Your brand will be better for it in the long run.

 

I’d like to hear about the worst clichés you’ve ever seen in marketing. Visual or otherwise. Post a comment, or e-mail me personally: johnf@bnbranding.com

 

Posted in BRANDING, FEATURE ARTICLES, SMALL BUSINESS MANAGEMENT | 3 Comments »
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Bare breasts mean business at Starbucks.

April 30, 2008

Notice anything different at your local Starbucks lately? I sure have. The familiar green and white logo on the cups is missing. It’s a travesty to brand-conscious graphic designers everywhere.

At first glance I thought maybe it was just a corporate cost-cutting measure — the result of tremendous Wall Street pressure to improve performance. But once I looked a little closer, I noticed something even more revealing:

Starbuck has bared her breasts! The mermaid that’s been the Starbucks icon from day one, has gone back to her topless, hippy roots.

There are a lot of other changes going on at Starbucks in Seattle — you might even call it a corporate shake-up — but none are as symbolic as the undressing of the logo. I take it as a sure sign that CEO Howard Schultz is serious about stripping away some of the fat and refocusing on the core of the Starbucks brand .

That little nod to the humble heritage of his company says a lot. The green logo has just two words: “Starbucks Coffee.” The retro logo reads “Starbucks Fresh Roasted Coffee.” It’s a reminder to the world that Starbucks has always been obsessively focused on the quality of it’s product.

In his book, Pour Your Heart Into It, Schultz says, “The number one factor in creating a great, enduring brand is having an appealing product. There’s no substitute.”

I know a few coffee snobs who claim that Starbucks isn’t as good as the local guy’s Ethiopian Tega & Tula. And they may be right. But I also know that Starbucks beats the hell out of the mom & pop drive-up operations that have appeared on every corner.

At Starbucks, the product is consistent. The coffee is just as good as ever, but the company has made some operational decisions that have had a subtle effect on our perception of that quality. Shultz seems determined to correct that, and if his track record over the years is any indication, he’ll pull it off.

Ever since I read his book back in ‘99 I’ve used Schultz and his organization as a great example of focused leadership, exceptional execution and textbook branding. He has always been the brand champion in that organization. He was one who introduced the idea of gourmet coffee to a nation of Folgers drinkers, and he has always fought to maintain quality standards even during their hyper-rapid growth.

Shultz is adamant about controlling the brand experience as much as possible, down to the last detail. That’s why the company never sold franchises. At first, Shultz didn’t even want to sell coffee in paper cups at all, lest it detract from the experience and affect the flavor.

So these new “transformational initiatives” of his are no big surprise.

First thing is to recapture that appealing coffee aroma in every store. Believe it or not, that smell of fresh roasted coffee is every bit as important to the brand as the look of the stores or the music they play. It works on a subtle, subconscious level, but the bottom line is, you won’t hang out and enjoy your double half-caf mocha if the place doesn’t smell good. So Starbucks is going back to manual espresso machines and killing the sale of breakfast sandwiches.

The Starbucks business model is based on the idea of the third place… that we all need a relaxing getaway that’s not home and not work. To me, it’s more of a romantic, Vienna coffeehouse experience than a quick, Italian espresso shot. So the roll-out of free wi-fi service is long overdue. Paying for an internet connection at Starbucks was just idiotic to me.

The third and final cornerstone of the Starbucks brand is its own people.

“We built the Starbucks brand first with our people, not with consumers — the opposite approach from that of the cereal companies,” Shultz said. “Our competitive advantage over the big coffee brands turned out to be our people.”

Starbucks doesn’t just talk about treating people well, the company really does. In the retail food service industry, where getting good help is always a challenge, Starbucks leads the way with its pay scale, benefits packages, training programs and retention rates.

“We believed the best way to meet and exceed the expectations of customers was to hire and train great people. That’s the secret of the power of the Starbucks brand: the personal attachment our partners feel and the connection they make with our customers.”

The company also listens to its front-line employees. The idea for Frappuccino came from the store level. The new website, mystarbucksidea.com, started out as an internal feedback tool for employees. Now anyone can go online and post their own ideas for Starbucks, vote for the best, and see what’s being implemented.

Which brings us back to that idea of reintroducing the old logo, circa 1971.

The change coincides with the introduction of a new house blend, called Pike Street Roast, for people who just want a good, robust cup-o-joe. In that context, and with everything else that’s happening at Starbucks, the branding throwback makes perfect sense.

The mark was originally inspired by a woodcut image of a Norwegian mermaid, fully exposed. Over the years, as Starbucks grew and became “more corporate,” the logo slowly morphed. Eventually the designers gave her long hair, which covered her breasts and made her more palatable to a broad commercial audience.

Now Shultz wants to go back in time. Back to when the company wasn’t really worried about offending anyone on Wall Street. Maybe this little flash of skin is just what the company needs.

 

If you want to recapture the magic of your brand, or build a new one from the ground up, give me a call. 541-749-4409.

Posted in BRANDING, CASE STUDIES, FEATURE ARTICLES | No Comments »

How to survive when the economy tanks.

April 16, 2008

 There’s a lot of economic doom and gloom in the news these days; Unless you’re living in a cave somewhere, you’ve heard about the housing market, the unemployment rate and the rising price of groceries and gas.

For many business owners, it’s frightening. The fortune-teller economists are predicting even more “belt tightening” as the year goes on, and if you let it, all the crummy forecasts might scare you into doing something totally rash. Like nothing at all.

It’s pretty common, actually. When the leading economic indicators start heading south, many business owners go into immediate survival mode. Stop, drop and roll! Duck and cover!

The natural tendency is to adopt a siege mentality and hunker down until “things get better.” So they pull the plug on marketing and branding. Then P.R and charitable giving. Then training and customer service initiatives. They stop doing the things that helped them succeed in the first place.

It’s a strategy of inaction, and it never works. Not in the long run.

Studies of life and death survival struggles prove that action is the antidote for despair. You see it in cancer patients, in soldiers, castaways, mountaineers and disaster victims. Those who let despair take over, sit down and die. Survivors, on the other hand, take action.

Determination and a disciplined, almost clinical approach seem to be the secret. Survivors don’t place blame, make excuses or wallow in self pity. They accept their current circumstances and start working on a solution immediately by setting small, achievable goals. They don’t waste a lot of energy running around in circles, doing things that won’t get them to the goal.

For a climber in the Andes, it meant extricating himself from a crevasse and literally dragging his starving body and shattered leg 10 miles down a glacier. All the way back to camp. For one hiker in the canyonlands of Utah, it meant amputating his own arm with his pocket knife.

Makes surviving a recession seem like a cake walk.

Make no mistake about it, a significant economic downturn can be fatal to a small business. But businesses fail all the time, regardless of what the economy is doing.

The fact is, if you have a clearly defined strategy, and the discipline to stick with it, there’s no reason you can’t do much more than just survive a recession. You can thrive. You can gain ground on the competition. You launch new products and improve your entire operation. The history of American commerce if full of war stories that prove the point.

Post and Kellog’s were battling head-to-head in the breakfast cereal category when the Great Depression hit. W.C. Kellogg plowed ahead, doubled his advertising budget and even introduced the world’s first vitamin-enriched product cereal. Post cut back and Kellogg’s has been the market leader ever since. (Kellogg also cut hours in his plant for three of his shifts and added a fourth, just to spread his payroll among more workers. But that’s another story.)

But forget about the 1930’s. Here are some things you can do, right now, to survive the perfect, economic storm.

1. Use downtime to your advantage. Most managers have so many fires to put out they never get around to long-term strategic thinking. If things are slow, do it! Clarify your objectives and fine-tune your elevator pitch. Revisit your value proposition. Make sure you can communicate your strategy clearly and succinctly. (Few CEOs can.)

2. Get your bearings and refocus your efforts. In the woods, the last thing you want to do is wander around in circles. Same thing in business. Don’t waste precious energy and money chasing business that doesn’t really fit your model. (see item #1)

3. Renegoiate your media contracts. When it comes to print ad space and broadcast spots, you should be able to get a lot more for your money right now. So play hardball. Insist that your advertising salespeople work up innovative new schedules.

4. Get creative. Brainstorm new strategic alliances, sponsorship opportunities or marketing initiatives. Look for ways to leverage your existing partnerships. Do something! And keep this in mind: When times are tough even small initiatives can have a big impact. Because everyone else is sitting around waiting for the rescue helicopters.

5. Recycle one of your favorite, old ad campaigns. A lot of people kill campaigns way too soon, before the public has ever been thoroughly exposed to the messages. So instead of creating a whole new campaign, go through your archives and dust off the advertising that’s worked for you in the past.

6. Spend a little extra time listening to your best customers. Forget about you, and find out what their problems are. Then help devise a solution.

7. Take extra care of your people. They’re reading all the bad news in the paper too, and it’s unsettling. So step up, and be a leader. As the CEO, you have to be an optimist. Because nobody follows a pessimist.

 

 

 

 

 

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Isn’t “Inspiring Bank” an oxymoron?

March 24, 2008

It’s funny, where people find inspiration; For Monet, it was the garden. For me it’s the bookstore. The ski slopes. And the Children’s Museum.

My bank is definitely not on the list.

The most exciting thing to ever happen at my bank was the emancipation of the counter pens…  They were released from their chains and replaced with crappy logo pens that were free to take home with just a minimal, $10,000 deposit into a 15-year Certificate of Deposit at the historically low rate of 0000.01 percent interest, less deposit verification fees and other institutional weasels.

Nope. The banking industry is the last place I’d look for business inspiration or marketing insight. That is, until I met Ray Davis, the CEO of Umpqua Bank. Mr. Davis was in Bend the other day, visiting his local “stores” and speaking at the entrepreneurs forum. Turns out, he doesn’t get inspired by the banking industry either.

Twelve years ago Umpqua Bank was a small, community bank with about $150 million in deposits. Today it has 135 stores in three states and almost 8 billion in deposits. Umpqua ranks 34th on Fortune Magazine’s list of 100 best places to work in the country, and is #1 according to Oregon Business Magazine.

Bankers and banking consultants from all over the world visit the Umpqua headquarters in Portland to see what they’re doing and how they’re doing it. And what’s even more impressive is that other businesses, in completely different industries, are also looking to Umpqua for inspiration.

So what’s behind it? What’s turned this small town brand into one of the fastest growing banks in the nation?

“Umpqua started to take off once we realized what business we’re really in,” Davis said. “I don’t believe we’re in the banking industry. We’re in the retail services business.”

When Davis applied for the job at Umpqua he warned the Board of Directors that he was going to throw out all the old conventions of the banking industry and start something completely different. Because he believed they couldn’t compete against the big guys in any conventional way.

“Banking products are a commodity,” Davis said. “You can’t differentiate yourself that way. The big guys are just going to copy any good new product we come up with. But they can’t copy the way we deliver the service. They can’t copy our experience.”

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For that, he borrowed ideas from two great retailers… Nordstrom and Starbucks. Umpqua stores look more like the lobby of a stylish boutique hotel than they do a bank. You can settle into a comfortable leather chair and read all the leading business publications. Have a hot cup of their Umpqua blend coffee. Check your e-mail or surf the web. Listen to their own brand of music and maybe even make a deposit or open a new account. Who knows.

It’s a dramatic leap when you compare that experience to the cold, marble conventions of the banking industry.

Clearly, Davis knows how to execute. He doesn’t talk about “execution” per se, but he obviously has the discipline to match the vision. He’s knows how to motivate and how to manage an organization through dramatic changes.

“As a CEO, you absolutely HAVE TO BE an optimist. There’s no other choice. Because no one will follow a pessimist. But you also have to be unreasonable to some extent and relentless to stay the course once it’s set.”

Here are some of the things Davis has successfully implemented and some reasons why his bank is now on my inspiration radar…

• Random acts of kindness:  Local Umpqua teams just do good stuff, like buying coffee for everyone who walks into a neighboring Starbucks. They don’t have to ask permission.

• They get their customer service training from Ritz Carlton.

• Every Umpqua employee gets a full week of paid leave to devote to a local charity. That’s 40 hours x 1800 employees! Any other banker would do the math and say it’s too costly. Davis says it pays off 100 fold.

• They’ve opened a innovation center in Portland’s trendy South Waterfront District.

• They have their own blend of coffee.

• Proceeds from Davis’ book go to charity. Buy it at www.amazon.com “Leading for Growth. How Umpqua Bank Got Cool And Created A Culture of Greatness.”

• They invented a way to measure customer satisfaction. As Fast Company Magazine put it: Umpqua Bank has a rigorous service culture where every branch and each employee gets measured on how well they deliver on what they call “return on quality.” Our research division, BNResearch, handles that kind of work for another innovative, billion-dollar company in an even less glamourous industry… veterinary medicine.

• They embrace design as a strategic advantage. Everything looks good at Umpqua. It’s a visually pleasing experience, which appeals to the creative side of me.

• Davis GETS IT! He knows, intuitively, that his brand is connected to their corporate culture. “Banking executives always ask, ‘How do you get your people to do that?’ It’s the culture we’ve built over the last 10 years. It doesn’t just happen. You don’t wake up one day and say, gee, look at this great culture we’ve got here. Our culture our single biggest asset, hands down.”

• He’s a great communicator. Davis uses stories, analogies and real world examples to motivate and persuade. Not banking statistics.

• He embraces the idea of a big hairy audacious goal. Everyone answers the phone “Thank you for calling Umpqua Bank, the world’s greatest bank.”

So the next time I’m looking for inspiration, maybe I’ll skip my usual haunts and head down to the bank. 

 

Posted in BRANDING, CASE STUDIES, FEATURE ARTICLES | No Comments »

Naming your baby vs. naming your business

March 14, 2008

I’ve done a good number of naming projects over the years, and I know that naming babies is much easier than naming products or companies.

First of all, with baby names there are only two people who have a say in the decision. It’s a simple democratic process where the wife always has veto power over anything the husband comes up with.

With company names, you have to get the consensus of many people. Sometimes there are even committees involved, which usually lead to winning names like Poolife for a swimming pool cleaning company.

When you’re naming a baby you can refer to all sorts of books full of perfectly acceptable names with all their hidden meanings and Latin derivatives. With company names, you have to rule out every name that’s ever been used before and start entirely from scratch. You can’t even go through the family tree and choose some obscure middle name, like you can with a child.

There aren’t any trademark laws protecting children’s names. You’re free to call your son Sam, even if there are seven other Sams in your neighborhood.

Doesn’t work that way in the business world. There are hordes of lawyers who do nothing but trademark protection and application work. So if your product name even sounds like something that’s already out there, you’re in trouble. Case in point: There was a little coffee shop in the small town of Astoria, Oregon that got sued by Starbucks for trademark infringement. It was called Sambucks.

And then there’s the whole translation issue. Face it, you probably don’t care what “Clark” means in Hungarian. But there are dozens of stories of products like the Chevy Vega, which didn’t translate real well. If you’re doing business globally, your naming project just got astronomically harder.

And here’s an important distinction: your child’s livelihood doesn’t depend on people remembering his or her name. Sure, unfortunate names like Major Slaughter, Ima Nut or Moon Unit might cause a lifetime of grief, but they won’t make or break the poor kid’s career like a bad product name can.

Most people don’t need professional help to come up with a good baby name. Business names are a different story. The do-it-yourself approach usually results in one of three types of lame names:

• Overly clever, pun-filled names like The Hairport or The Family Hairloom. Har har.

• Totally boring, literal names like the now defunct Third Street Coffee House.

• Names that backfire completely when applied to internet URLs. Need a therapist? Try www.therapistfinder.com. Need some good art, go to www.speedofart.com. Looking for a nice pen? www.penisland.com.

A good name can be costly, but not nearly as costly as blunders like that. So save yourself a lot of time, money and frustration and just hire a branding firm to help from the very beginning. Not a design firm… they focus on the language of images, not words. And not an ad agency… For some reason, ad agencies love to use one-word names that are purposely vague. Like “North” “Red F” “Citrus” “Fuel” If want to confuse people, just follow that lead.

Here are a few other examples of names, both good and bad:

• Federal Express became Fed Ex. A smart move, considering that’s what everyone called ‘em anyway. Besides, repainting all their jets with the new shorter logo saved the company millions year in fuel costs alone.

• Dress Barn??? How many women will admit to shopping there, much less bring herds of their friends in?

• Drug companies spend billions every year on names, yet they come up with some of the worst: “Nasalcom” for an inhaled antihistamine. Sounds like a rat poison that works when they sniff it. “Vagistat” for a yeast infection medicine. “Cutivate” for a skin condition medicine. Aspercreme for an ointment that doesn’t even have any aspirin in it. Not only are drug names often lame mash-ups of other words, the FTC recently concluded that dozens sound dangerously similar.

• Here are a few of my own: PointsWest for a resort development on the west side of Bend, Oregon. Sit Down Dinners for a personal chef service. Widgi Creek for a golf club.

Posted in BRANDING, NAMING | No Comments »

Is it car sickness, or just nauseating radio ads?

February 27, 2008

Kids get car sick. Cleaning vomit from the back seat is part of every parent’s on-going indoctrination process. But when adults start getting woozy every time they run a quick errand, you have to wonder about the cause. Is it car sickness or the constant barrage of bad radio advertising that makes you want to throw up?

Thankfully, the automotive engineers have devised a cure. With the new steering-wheel mounted audio controls, drivers can now change the channel, quite literally, without lifting a finger. So the instant a bad commercial comes on, they’re outta there. Before the gag reflex forces them to the side of road.

You’ve heard the commercials I’m talking about. The worst offenders involve a ridiculous, up-beat jingle or dialog between two “real people” who are stiffer than a week-old corpse. In the worst-case scenario, it’s a double whammy of bad dialog with a poorly-produced jingle sandwiched on both ends.

How does this happen? Why do so many radio commercials degenerate into one long string of corporate cliches and yes-man mumbo jumbo?

Radio is potentially the most creative of all your advertising options. There’s a reason it’s called the “theater of the mind.” In a 60-second spot there’s time for character development. Plot lines. Even intrigue. Well-written radio engages the human imagination and entertains while conveying a clear message about the character of your business.

You can be concerned, caring and compassionate. You can be convincing. You can create drama that moves people, or comedy that cracks them up. You can literally make people hungry just by using a few choice words and some sizzling sound effects.

Unfortunately, most companies come off sounding obnoxious, greedy or condescending. Announcers talk about “our friendly and knowledgeable staff. ” Jingle lyrics sing about “qual-i-ty and crafts-man-ship.” And in phony slice-of-life commercials people talk enthusiastically about douches and over-the-counter hemorrhoid medication. Puke alert! People just don’t talk that way, and everyone knows it.

If you want your radio commercials to be more palatable to the listeners — and more profitable for you — you have to do more than just the usual sales spiel set to music. In fact, the most memorable radio campaigns all contain five crucial elements:

1. A smart, coherent strategy.
2. An original idea.
3. Exceptional writing.
4. High production values.
5. Plenty of air time.

Devising a simple but intelligent advertising strategy is the single most important step in the whole process. Unfortunately, it’s also the most widely neglected. No one expects the radio stations to help with strategy. That’s your job — or your agency’s job. If you want results in the long run, you really need to spend some time thinking it through before you run out and book the air time.

Most advertisers use radio only as a tactical sales tool. But a long-running campaign can be much more than that. It can be a major asset to your business and a constant thorn in the side for your competitors. (You want them thinking, “gee I wish we would have done that.”)

A smart advertising strategy combines a high degree of business discipline with a good dose of imagination. It’s a creative thinking process that few business owners ever take time for and that many people consider pie in the sky… delving into issues like your core values, positioning strategy, brand personality and competitive analysis.

So if strategic thinking is not your strong suit, get some help. Find someone who can guide you through the planning process, help you prioritize your messages and hone-in on the dramatic difference that will resonate with listeners. Insist on a thorough strategy statement that will become the foundation of all your future advertising.

Once you know what to say you can begin thinking about how you’re going to say it. That’s where an original idea is absolutely invaluable.
Radio is great for conveying ideas, but lousy for listing details. People tune out when you start throwing laundry lists of products and services at them. You have to whittle it down to one main idea and then hammer that idea home time after time.

Doug Hall, Founder of the Eureka Ranch says, “articulating your overt benefit is a never-ending journey. You can always do it with greater relevance, interest and excitement. “

What you’re after is one idea that has thousands of possible iterations. Tom Bodett’s timeless, down-home humor for Motel 6. The Great American Hero series for Bud Light. Orkin’s authoritative announcer for their product that “kicks fire ant butt.” “Pizza Pizza” for Little Ceasar’s. These are big ideas that have produced big results over the long haul.

There have been many copywriters on the Motel 6 account, but the campaign stays fresh because the idea is consistent, the character is well developed and the writing is sharp. Which brings us to the third major component of great radio advertising.

Writing for radio is tough. Every word has to be written with an ear for alliteration. You have to hear it. You have to sound it out. Then you have to edit mercilessly. Dialog should flow naturally, as if from the lips of a real person, not some cheap pitchman. It should be quick. Snappy. And smart.

Easier said than done. Some of the finest fiction writers in the world have trouble writing believable dialog. In Hollywood the problem is pronounced. The major movie studios employ writers who do nothing but re-work the dialog on existing scripts. And even then, there is a lot of really lousy dialog that gets through. It takes a special ear. Just because you got A’s in English class back in college doesn’t mean you can write a good script.

Of course a good script, an original idea and a brilliant strategy won’t get you anywhere if you cut too many corners on the production of your commercials.
All the radio stations offer free production services. The sales rep will write you a script and the station’s producer will record the voice-over, add sound effects, drop in a music bed, do a mix, and cut the necessary dubs. The problem is, the producer might have as many as 40 spots to complete in a weekend, and after a while they all start sounding the same.

For instance, finding good voice talent is always a challenge. There are plenty of people on the radio with great voices who can’t act worth a hoot. And that’s what we’re really talking about here. Acting.

Modern technology now allows us to produce radio spots here in Bend while using actors anywhere in the world. So you don’t have to settle for a local DJ who’s also doing spots for a used car dealer down the street. Keep in mind, your talent is the audio personification of your company. He or she better be able to convey genuine emotion using just the vocal chords. He better be ready to capture the flavor and the inflection of a well-written script without going through thirty different takes. Otherwise, even the most talented audio engineer with all the latest sound enhancement software won’t be able to save it.

The last piece of the puzzle is reach and frequency. That is, how often are your spots running and how many people are listening. (Without getting ill.)

The most common mistake is spreading your budget way too thin across too many different stations. Inc. Magazine recently published some good guidelines for this. “You should be buying more frequently over two weeks instead of spreading it out over a month, and buying 30 spots on two stations instead of 18 spots on three.”

A rough rule of thumb is that listeners need to hear an engaging ad at least three times a week before it starts to break through the clutter. Believe it or not, if your spots are well done you’ll get sick of them a lot faster than the general public will. So resist the temptation to change. Stick with it until the airwaves are saturated.

Radio is a wonderful, cost effective medium. When all five elements come together in a 60-second spot it can be pure magic. Remember, you’re looking for solid strategy, an original idea, concise writing, strong production values and plenty of air time. Even four out of five would be nice. But when several of those elements are missing, there’s a good chance your ads will just be turning stomachs. And ultimately, it’s your responsibility as an advertiser to keep that from happening.

Posted in ADVERTISING, FEATURE ARTICLES, SMALL BUSINESS MANAGEMENT | No Comments »

Give your brand a good, strong shot of vodka.

February 15, 2008

The first rule of advertising is this: Never take the same approach as your closest competitors. If you want to differentiate your brand, you have to think “different.”Here’s how: 

•Even if you’re selling the same thing, don’t make the same claim. There are hundreds of different ways to sell the benefits of your product or service, so find one that’s different than your competitors. 

• Don’t let your ads look anything like competing ads. Use a different layout, different type style, different size and different idea. The last thing you want to do is run an ad that can be mistaken, at a glance, for a competitor’s ad.

• If you’re on the radio, don’t use the same voice talent or similar sounding music. Find someone different to do the voice work, rather than a DJ who does a dozen new spots a week for other companies in your market. Same thing for tv spots. Your campaign should look, feel and sound different than anything else that’s running in your category. 

Unfortunately, every industry seems to have its own unwritten rules that contradict the rules of advertising. 

These industry conventions aren’t based on any sort of market research or strategic insight. They’re not even common sense. Everyone just goes along because “that’s how it’s always been done.”

The problem is, if that’s how it has always been done, that’s also how everyone else is doing it. In fact, some of these industry conventions are so overused they’ve become cultural cliches.

The rule in the pizza business says you have to use the “pull shot:” A slow-motion close-up of a slice of pizza being pulled off the pie, with cheese oozing off it. In the automotive industry you have to show your car on a scenic, winding road. Or off the scenic winding road if it’s an SUV. In the beer business, it’s a slow motion close up of a glass of beer being poured. 

These are the images that everyone expects. They are the path of least resistance for marketing managers. But if you go down that road, and follow your industry conventions, your advertising will never perform as well as you’d like. In fact, history has proven you have to break the rules in order to succeed.

Absolute Vodka is a perfect example. In 1980 it was a brand without a future. All the market research pointed to a complete failure. The bottle was weird looking. It was hard to pour. It was Scandinavian, not Russian. It was way too expensive. It was a me-too product in the premium vodka category.

But the owner of Carillon Imports didn’t care. He believed his product was just different enough… That all he needed was the right ad campaign. 

So he threw out all the old conventions of his business and committed to running an image-building campaign. And he didn’t just test the water, he came out with all his guns blazing. He committed to a campaign that was completely different than anything else in his industry.

Needless to say, it worked. The “Absolute Perfection” campaign — which is still running today — gave a tasteless, odorless drink a distinctively hip personality and transformed a commodity product into a cultural icon. In a decade where alcohol consumption dropped, Absolute sales went from 12,000 cases a year to 2.7 million. And it’s still the leading brand of Vodka in the country.

The moral of the story is this: When you choose to follow convention, you choose invisibility. To gain attention disrupt convention.

Instead of worrying about what everyone else has done, focus on what you could be doing Take the self-imposed rule book and throw it away. Do something different. Anything! This is especially important for service companies that are difficult to differentiate from the competition.

Take real estate agents for example. Realtors are, in essence, me-too products. In Bend, Oregon they’re a commodity. Even if a realtor has a specialty there are at least 100 other people who could do the same thing. For the same fee. That’s the bad news.

The good news is, even though there’s no difference in price and no discernable difference in service, you could still create a major difference in perception. If you’re willing to think different.

Like Absolute Vodka, a unique approach to your advertising is the one thing that can set you apart from every other competitor. Advertising is the most powerful weapon you have, simply because no one else is doing it. At least not very well.

But putting your picture in an ad won’t do it. That’s the conventional approach.

Remember rule number one and run advertising that says something. Find a message that demonstrates how well you understand your customers or the market. Run a campaign that conveys your individual identity without showing the clichéd, 20 year old head shot. Do what the owner of Absolute did. Find an approach that is uniquely yours, and stick with it no matter what everyone in your industry says. Over the long haul, the awareness you’ve generated will translate into sales.Next thing you know everyone else will be scrambling to copy what you’re doing.

Eventually your campaign just might become a new industry convention.

Posted in DAILY POSTS | 1 Comment »

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