Saturday, March 05, 2011
Harvey's Take on Advertising
from Harvey Mckay:
Use your ads to your advantage
By Harvey Mackay
A lion and a tiger were drinking beside a river when the lion let out a huge roar. The tiger said, "Why do you roar like a fool?"
"That's not foolish," said the lion, with a twinkle in his eyes. "They call me king of all the beasts because I advertise."
A rabbit heard them talking and ran home. He thought he'd try the lion's plan, but his roar was just a squeak. A fox came to investigate and ate the rabbit for lunch. The moral of the story: When you advertise, be sure you've got the goods and can deliver them.
For every hundred ads that run, only ten are effective. About 85 sink beneath the waves unnoticed. The other five are noticed and give such negative sparks they work against the advertiser.
The Super Bowl presents an unequalled showcase for television ads -- so much that folks who don't care about the game watch just to see the commercials. The great ones run on air and online for weeks after, getting plenty of buzz. For those ads, the investment of $3 million for a 30-second spot, not to mention the $1 million to produce it, is worth it. Those that bombed will just leave their sponsors baffled, wondering where they went wrong.
What's the difference between good and bad advertising?
Advertising is one of those soft sciences in which many people regard themselves as experts. The results often are ads designed for a target audience of one -- the guy who pays the bills. Agencies may offer strong opinions, but there aren't many that are going to refuse clients who insist on having their own way just because the ads are stinkers.
How do you avoid the pitfalls of bad ads?
Rule 1: Stay out of the picture. There are many egotists who insist on having their own faces leering out from amid assembled multitudes of refrigerators or used cars because "the public knows me" or the agency couldn't talk them out of it. Consider this: Is it more important to sell your face or your product?
Rule 2: Don't be your own copywriter. This is the common failing of glib corporate types who make their livings selling words to other people. The only problem is, they make their livings selling the wrong kind of words as far as advertising copy is concerned. They sell big words and technical words -- and lots of them. Advertising people sell tiny words, and as few of them as possible. They know effective advertising isn't about products. It's all about the benefits people get from the product.
Rule 3: Hire an advertising manager. This is a tough one because so many corporate cultures are committee-driven rather than research-driven. It's true that too many cooks spoil the stew. An ad stuffed with everyone's idea of what's most important results in visual and verbal clutter.
Rule 4: Don't play it safe. The most common mistake of all is the "safe" ad. It doesn't make any obvious mistakes. It just isn't interesting enough to be noticed amid the multitude of ads clamoring for attention.
Rule 5: Hire an agency the same way you buy a suit. First consider quality. You can define quality as demonstrated success in working with companies similar to your own, with budgets similar to your own, and winning awards for those campaigns. I expect ads to be noticed, and I like hard data from consumer research.
Rule 6: Consider an agency's style. There are two types of agencies to avoid: account-driven and creative-driven. If the account people dominate, you're going to get terrific service. But what about the ads themselves? If the creative types dominate, you'll get great ads, but they might be wildly expensive and wide of your target. You need an agency that has strong account services, plus creativity.
Rule 7: Then make sure you have a fit. You want an agency that isn't so big you'll be lost in the shuffle but big enough to include the range of talents or media-buying capabilities you need. You want to make sure that personalities mesh. And make sure there are no conflicts of interest.
Rule 8: Set the price of the contract. Agencies can and do make a profit on your account. Remember, it's all negotiable. The good agencies will be open with you and discuss their fees.
Quality advertising shows your commitment to your product or service. Advertising puts a face on your company. Put your best face forward.
Mackay's Moral: If you're sold on what you're selling, great ads will do the telling. Sphere: Related Content
Don't Rush It
from my email:
Daily Sales Tip: When Negotiating, Great Sellers Talk Value
He asks, "how much is it?"
Undergraduate sales trainers call this a "hot button" and say "it's time to close."
Great Post-Graduate sellers know that the "sale" hasn't gotten to the "I must have it" stage yet and there's more work to do before it's time for the pricing conversation. "How much is it" is a knowing or unknowing expression on the part of the buyer which implies, "if this stuff is cheap enough, maybe I'll go for it."
The reality is, the presentation has gotten the buyer to "it's a nice doo-dad, but I have seven already. If it's cheap, ok."
So you say, "let's make sure we've nailed down the proposition. The idea I've put together to jump start/grow/expand/make more profitable/get more customers for...your business, starts with the notion...makes sense right?"
If he responds, "right"...you follow with, "and then I and my support team will make sure that the implementation is perfect by ensuring...you get that right?"
If he is still enthusiastic in his responses, you offer "well I'm happy to tell you that the project is reasonably priced for both of us at ________."
Then he says, "Great," right? Nah. He coughs and says, "that's way too much/unaffordable...how about ________?"
And you respond, "Mr. Jones, the value you will receive as a result of this targeted plan and the effort that will be expended to grow your business is very fairly priced for both of us. That will make it a successful partnership."
Smile, shut up, and wait for his "Let's go."
Source: Sales manager/consultant Bob Sherman
Friday, March 04, 2011
Friday Night Marketing News from Mediapost
Just because it's the weekend, we don't rest at ScLoHo's Collective Wisdom.
Saturday at 6am a Sales Tip, Harvey Mackay's thoughts on Advertising at noon, and our Classic Ad of the Month at 6pm.
Sunday starts with another Sales Tip at 6am, because we do one every day of every year. Then at noon, a lesson from the Girl Scouts and our weekly Sunday Seth Godin thought starter to get you ready for Monday.
Now, you can click and read the wrap up:
Hospitality
by Tanya Irwin "We've done a great deal of research to uncover 10 key markets that drive over 50% of revenue," Lee tells Marketing Daily. "We know that our guests are not only traveling for business, but for leisure, often with their families. Now we have insight into psychographics, attitudes and behaviors and actual likes and dislikes that informed our targeting strategy." ...Read the whole story >>
Retail
by Sarah Mahoney
It seems that consumers spent February doing something retailers love to see -- not just shopping but also shopping steadily, with retail sales gaining in just about every type of store. That will to spend is especially welcome, experts say, since it means people ignored disruptive winter storms and rapidly rising fuel prices to do so. ...Read the whole story >>
Automotive
by Karl Greenberg Chevrolet will have a roster of events and programs at the South by Southwest festival in Austin, Tex. next week. This is the second year for Chevrolet as a "Super Sponsor" of the high-tech film, music, digital and arts event. The automaker will show off its panoply of in-vehicle gadgetry and serve as shuttle service for attendees. ...Read the whole story >>
Spirits
by Karl Greenberg
Tres Generaciones Tequila has signed a long-term partnership with retired boxer, future hall of famer, and president of Golden Boy Promotions, Oscar de la Hoya, who will act as a business partner and brand ambassador for the premium tequila. ...Read the whole story >>
Packaged Goods
by Nina Lentini The multi-market digital and on-site activations will include Nivea's sponsorship of Rihanna's upcoming "Loud" tour in the U.S. and Europe. The multi-city tour will include fan engagement through Nivea- and Rihanna-owned social media channels and will feature various Nivea-branded activations. ...Read the whole story >>
by David Goetzl
While Netflix continues to add opportunities to stream TV episodes, Redbox may stick with films as it launches its subscription-based digital service, expected later this year ...Read the whole story >>
Sphere: Related Content
Share What You Know
7 days a week, this website is updated 3 to 4 times a day with sales, advertising, marketing and media information and tips.
This only works because others are willing to share what they know. I subscribe to lots of newsletters, blogs, and the like and pick out my favorite to share with you.
If you would like to get updates in your email or an RSS reader, there are links on the right side of this page.
And speaking of email, this piece from MarketingProfs.com tells you how you can share what you know:
How to Make Content King. Again.
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"The experts have apparently decided that content marketing is back for 2011," writes Mark Brownlow at Email Marketing Reports. "The new (old) mantra is 'quality content.' And everyone should be producing it: publishers, retailers, service companies."
If you're wondering what quality content is—and how it might differ from what you've been doing all along—Brownlow offers this workable definition:
Quality content is "any element in the message that provides standout value to the recipient (aside from the inherent 'value' of any offer)." It should be useful and/or entertaining and/or capable of emotional impact, he adds.
Good news: Consistently finding material for quality content need not be an onerous task. Brownlow outlines basic rules for discovering hidden gems. Among those rules:
Look for low-hanging fruit. "If you've not thought much about content before, start small," he suggests. "See what you already have lying around the office or website that might find use in your newsletters."
Repurpose or reuse content. That series of tweets can become a blog post; or that debate in your forum might make an entertaining article at your website. And it's fine to reuse content your new subscribers might not have seen. "Nobody on your email list today remembers the article you sent out in 2002 to your first 37 subscribers," he explains.
Create new content that stays relevant over time. You can discuss a news item that may be old news by next month, or offer a how-to primer that retains relevance. "Both make good content," Brownlow notes, "but one needs constant updating to have long-term value, the other doesn't."
The Po!nt: Set a royal standard. Don't make the mistake of producing email content for content's sake. "Always bear in mind how that content contributes to your business success," Brownlow concludes.
Source: Email Marketing Reports.
Looking for great email marketing data? MarketingProfs reviewed hundreds of research sources to create our most recent Email Marketing Factbook (May 2010). With 129 pages and 90 charts, it is full of relevant email marketing stats and trends. The Email Marketing Factbook is Part 1 of the complete Digital Marketing Factbook (our 296-page full report).
Sphere: Related ContentAnd the BIG Money goes to....
Hey, it's tax season in the U.S. of A.
And lot's of folks use Uncle Sam as a savings account, with tax refunds as their annual payoff.
Here's who will benefit in 2011 according to a report from Mediapost in my email this week:
Tax Returns To Buy TVs, Furniture And A Vacation
According to the National Retail Federation's 2011 Tax Returns Consumer Intentions and Actions Survey, many Americans are now keen to use their tax refunds to treat themselves or their families to a major purchase. 13.2% of Americans will spend their refund on a big ticket item, such as a new television or furniture up from 12.5% last year.
But with the economy also serving as a reminder that it's best to be financially prepared for the worst, 42.1% of people will put their refunds away for a rainy day vs. 40.3% in 2010. 66.2% of tax payers are expecting a refund this year, up from 65.5% last year.
Matthew Shay, NRF President and CEO, says "Despite the difficult unemployment situation... Americans receiving a tax refund this year seem eager to plough this money back into the economy... NRF is becoming more bullish about the economic recovery."
Other ways consumers will use their refunds include:
- 41.9% of consumers plan to pay down debt.
- 11.9% planning a vacation
- 29.7% paying for everyday expenses
This year, 57.6% of U.S. taxpayers will file their taxes online, up from just 50.1% in 2007:
- 35.2% will prepare their taxes using computer software
- 21.5% will use an accountant
- 19.3% will use a tax preparation service
- 10.9% will have a friend, spouse or other relative prepare their taxes for them
- 13.2% will prepare their taxes by hand
According to the survey, 63.9% of Americans will have filed their taxes by the end of February, meaning that many tax returns have already been received or are on the way. An additional 21.1% will file in March and 15.0% will wait until the last minute and file in April.
Phil Rist, Executive Vice President, Strategic Initiatives, BIGresearch, notes that "Many Americans have spent the last few years paying down debt with their tax refunds, but... others are looking to the future... by putting their ‘free money' in a savings account... "
For more information from the NRF and BIGresearch, please visit here.
Sphere: Related ContentSelling Like Charlie Sheen
This is from the TalkingMediaSales.com site:
What a Sales Person Can Learn from Charlie Sheen
The last week has been an interesting one if you’re a celebrity watcher. I’m talking of course about Charlie Sheen.
Regardless of your opinion on him and his very public fall from grace, it’s interesting as a sales person to see what kind of lessons you can take from it.
Let’s start with the product. Charlie Sheen is trying to sell himself, and it seems to be selling the producers of his hit show on hiring him back. Whether this is the right way to go about convincing them (especially in light of asking for a 50% pay rise), remains to be seen.
His strategy here is to try and rally popular support in order to do so – in joining Twitter just 2 days ago, he has amassed over a million followers. But he is also hitting the media trail, which you can liken to cold calling. And he’s been effective – in the space of 3 days, he has managed interviews with ABC, NBC, and CNN to go in and tell his story – which is perhaps the biggest lesson.
A couple of days ago, we shared a story on our Facebook page about being in love with your sales story, by Mike Weinberg. Sheen clearly loves his, because he tells it with such conviction. Sure, his story is low on benefit and high on crazy, but he sells it. He has belief in the facts of his story and a passion for his medium (himself), and he hammers it home.
So is it effective? Maybe not, but everyone in the world now knows the story. Do your clients know yours?
PHOTO – HOY! SUSHI
This post by Ben Shute
Ben has spent more than a decade in the media industry, across a number of mediums. He has worked for News Limited as an advertising sales manager across two of Australia’s biggest newspapers, and more recently as a sales strategist Yahoo!7.
Sphere: Related ContentThursday, March 03, 2011
Thursday Night Marketing News from Mediapost
Our nightly wrap up. Click & Read:
Beverages
by Karlene Lukovitz Coca-Cola's decision to full-out acquire Honest Tea (it acquired 40% in February 2008, for $43 million) clearly means that the former sees substantial benefit in continuing to provide the organic tea maker with the formidable distribution and other resources at its disposal to help drive continued growth. ...Read the whole story >>
Retail
by Sarah Mahoney
Valassis owns RedPlum.com, and News America owns SmartSource.com, both leading digital coupon sites. The intention is to make both sites more robust, John Lieblang, president of Valassis Digital Media, tells Marketing Daily, greatly expanding the number of coupons available to consumers. ...Read the whole story >>
Food
by Aaron Baar The council, a division of the National Fisheries Institute, is embarking on a month-long campaign to place ads in nearly 1,000 health clubs in 20 markets promoting "Tuna the Wonderfish." The effort, financed in large part by the three major tuna brands (Bumble Bee, Chicken of the Sea and StarKist). ...Read the whole story >>
Automotive
by Karl Greenberg
The firm said General Motors and Nissan showed the biggest year-over-year boosts in incentives among the top six automakers and that leases constituted about a quarter of new car transactions, making it the highest month for lease penetration since November 2005, when nearly a third of transactions were leases. ...Read the whole story >>
Financial Services
by Tanya Irwin Having calculators or a few content articles about the home-buying process is no longer a viable strategy for mortgage lender websites. Bank of America, Chase and PNC have raised the bar with new tools, positioning those lenders as a "trusted partner" throughout the process, according to a report from Change Sciences Group. ...Read the whole story >>
Packaged Goods
by Karl Greenberg
Castrol is continuing its partnership with the FLW Outdoors tournament fishing organization for the 10th season. FLW Outdoors is the largest fishing tournament organization in the world, offering anglers worldwide the opportunity to compete for millions over the course of 191 tournaments in 2011. ...Read the whole story >>
Sphere: Related Content
Still considering Groupon?
A lot has been talked about and written about Charlie Sheen, I mean Groupon in the past few months. Take a look at this from one of my clients:
Two Sides of the Social Buying Coin
Mar. 1, 2011
Lately all the buzz has been about social buying websites like Groupon, LivingSocial and SlickDeals. Everyone loves a bargain. I know I like the idea of getting half price at a good restaurant – whether it’s an old favorite or a new one I’ve been meaning to try. And it’s a great way for the business to get trial. Everyone wins, right?
Well, not so fast, my friend. Last month Scott Tingwald wrote about Groupon engaging in some activities that could hurt its brand. There are other factors retailers may want to consider before jumping on the social buying bandwagon.
The biggest concern for retailers should be whether they are willing to risk devaluing their product. There is always a point of diminishing return when it comes to discounting. If a product is always on sale, why would anyone ever buy it at full retail? Unless they are desperate, most consumers will simply wait until the next coupon mailer or this week’s “sale of the century.”
“There’s no doubt social buying sites have tremendous potential.”
There’s also the issue of selling below cost. If costs are higher than the selling price, “making it up on volume” is a dubious strategy. As I understand it, sites like Groupon essentially require retailers to discount their products by 75 percent. The consumer gets 50 percent off. The retailer and Groupon split the other 50 percent. That leaves the retailer with 25 cents on the dollar.
So what’s the problem? It’s just a temporary loss leader to stimulate trial. Nothing new or radical about that. Until it runs into that pesky old law of unintended consequences.
Let’s say all these new customers are just bargain hunters. They have no plans for return visits and don’t even fit in with the profile of the company’s regular customers. In fact, the influx of activity could upset the regulars and exceed the capacity of the organization to provide a positive experience for everyone. That’s seldom a good thing, and may be very costly.
But wait! There’s more. Never forget the nature of social media users. Many of them like to make their opinions known. That means reviews on sites like Yelp or Groupon itself. If those reviews are positive, great. If not… well, you get the picture.
There’s no doubt social buying sites have tremendous potential.
For certain businesses, these sites can be a powerful new marketing tool. But as the old expression goes, “there are two sides to every coin.” So before you make the call, it would be good to know which is the winning side for your business.
To get our latest articles when they are posted, please subscribe by e-mail or RSS.
New Ad Campaigns
Amy's weekly update:
Subaru brings sexy sumo back. Bedazzled Snapple bottles. Let's launch!
John Jameson would do anything to save his famous Irish whiskey from the great fire of 1789. When a sensible plan fails to pan out, Jameson takes extreme measures and opens a dam, covering the town with raging waters. "In the end, the not-so brilliant plan saved the whiskey. And all of Ireland agreed: catastrophe averted," closes "Fire," seen here. TBWA/Chiat/Day New York created the ad for Jameson Irish Whiskey. Noam Murro directed it. 
Virgin Mobile brings crazy front and center with a pair of TV ads promoting the LG Optimus V, coupled with a $25 unlimited data plan. The ads show a woman who goes a tad overboard with staying connected to the man she's dating. And by overboard, I mean stalking and breaking and entering. In "First Date," a woman stalks her date from high above a tree, watching him read inside his apartment. To pass the time, she can check his Flickr stream and compare herself to his exes and send pictures to her mother. Watch it here. The same woman wonders why her date hasn't responded to the countless text messages sent. She knows he's home, for she's hiding in his closet and about to check-in via Foursquare. See the ad here. Mother created the campaign.
How would you react if a sumo wrestler was inside your garage, leaning against your car? If you own a 2011 Subaru Forester, this sexy scene comes standard. Subaru first introduced viewers to sexy sumo wrestlers back in 2008. They're back in 2011, and they go where you go. Having a romantic moment with your girlfriend can be difficult when a wrestler's butt is in your line of vision. Park your Forrester in a no-parking zone? You'll probably get a ticket, but don't leave the ticket between the wrestler's legs. He doesn't like that. He does, however, enjoy car wash baths... in slow motion. "With the new Japanese-engineered Subaru Forester, sexy comes standard," says the voiceover. Watch the ad here, created by DDB Toronto. OMD handled the media buy.
New York Presbyterian Hospital is running a phenomenal TV campaign, dubbed "Amazing Stories," featuring recovered patients, in their own words, describing the care they received by hospital doctors and staff. One patient that stood out for me was Matt Long. I recently purchased his book, "The Long Run," and recognized him immediately. Long is a New York City firefighter and marathon runner who was biking to work during the 2005 transit strike when he was hit by a bus. He tells two separate stories. The first ad praises his nurse, who came to work on her day off to make sure Long's dressings were properly changed. See it here. The second ad floored me. An orthopedic surgeon was called to the hospital to care for Long. He was unable to get past a certain street, because he was traveling alone and a minimum of four people was needed. The doctor drove back home and put his two kids and pregnant wife, who was on bed rest, into the car, so he could get to the hospital. Incredible. Watch it here. Munn Rabot, New York created the campaign, edited by wild(child).
The Las Vegas Convention and Visitors Authority launched "Tough Questions," the latest ad in its ongoing "What happens here, stays here," campaign. In it, a dad seamlessly explains to his young daughter how babies are made, using a stuffed rabbit and whale as props. When the youngster asks why adults like to visit Las Vegas, the father becomes a bumbling mess, deferring the hard question to mommy. See the ad here, created by R&R Partners.
Snapple doesn't need bells and whistles attached to its bottles to prove that it's extraordinary; using green tea, black tea and real sugar does the trick. A factory manager notices a number of Snapple bottles on the assembly line are equipped with gadgets: moving feet, bells, confetti and lights. He confronts a pair of assembly workers (very reminiscent of "Laverne and Shirley's" opening scene) and informs them that Snapple doesn't need outer accoutrements to make it better. Watch the ad here, created by Deutsch LA.
A woman is one scratch away from buying the coveted necklace she dreams of in a TV ad for Colorado Lottery's Cool Millions game. Perhaps if she wins the voices will stop. The woman marches into a jewelry store, right up to her favorite piece of expensive jewelry. It talks back to her, and encourages her to scratch her lotto ticket inside the store, while wearing the piece of talking jewelry. As the voiceover states: "With three chances to win an instant million dollars, your wish list might start coming to life." See the ad here, created by Cactus, Denver.
I'm resurrecting an old Web film from last year that continues to amuse me. Land Rover launched "Sword Collector" to promote the safety drivers and passengers will experience inside a LR4. The kicker is, you don't need to be driving the LR4 to feel safe. A man brings his sword-collecting co-worker outside. Carrying a sword in his belt, the collector asks: "is this about my swords?" It's not until the co-worker sits safely inside his Land Rover that he tells his colleague: "I lied. It is about the swords, actually. HR says they all have to go." "You'll feel safe inside," closes the film, seen here and created by Young & Rubicam New York.
Random iPhone and Android App of the week: The Watsons created an app for the New York City Health Department called the NYC Condom Finder. The app uses a smartphone's GPS system to locate venues distributing free NYC condoms with packaging selected by fans. The app also provides information about the NYC Condom program and a "dos and don'ts" for condom usage. The free app is available in the App store and Android store.
Call Prep
from my email:
Daily Sales Tip: Asking the Right Questions
You can improve the quality of questioning during sales calls by spending five minutes before each call thinking about these points:
* Determine the answers you need to find out. Choose pieces of missing information that you must get from the prospect.
* Try to phrase your questions in an effective manner. If you phrase your questions poorly, you may get loaded, self-serving or defensive answers.
* Ask your questions in an appropriate sequence. No matter how appropriate your questions are, you may not get the information you need if they're asked in the wrong order.
* Look for specific information about buyer needs. What are the specific results that the prospect expects to gain from what you're selling?
* Try to find more information about competitors. What are their primary strengths and weaknesses? What is the price differential between you and your competitors? Is price a major factor with this prospect?
Source: Adapted from How to Listen and Double Your Influence With Others, by sales trainer/author Brian Tracy
Wednesday, March 02, 2011
Wednesday Night Marketing News from Mediapost
Click & Read:
Retail
by Tanya Irwin The combined wasted dollars spent by both JCPenney and Stella Artois indicate that advertisers need to do a better job of testing, especially ads debuting during the high-priced media buy of big events, says Ace Metrix's Peter Daboll, adding that the Stella Artois ad also shows that using a celebrity does not ensure an ad hit. ...Read the whole story >>
Automotive
by Karl Greenberg
The automaker posted a 50% jump in sales last month, with 207,028 deliveries of Buick, GMC, Chevrolet and Cadillac. Retail sales alone were up 70%, which the company says is the highest year-over-year gain in its history. In the first two months this year, GM's total sales have risen 36%, with the retail portion of that up 52%. ...Read the whole story >>
Entertainment
by Aaron Baar "We're seeing the momentum our business has gained with the explosion of smartphones; it's fueling the growth in our subscriber base," John Irwin, president of Rhapsody, tells Marketing Daily. "This is the right time to raise the awareness of the value that on-demand music can bring to the music fan." ...Read the whole story >>
Retail
by Sarah Mahoney
Add Best Buy to the list of big-box retailers looking to jump-start home appliance sales. The Minneapolis-based chain is upping the ante on such competitors as Lowe's, Sears, and Home Depot, and says it is now offering free delivery, haul-away, and no-interest financing on all its home appliance purchases. ...Read the whole story >>
Automotive
by Karl Greenberg Nissan Motor's luxury division Infiniti used its Tuesday press conference at the Geneva Auto Show both to show a concept vehicle and to roll out a global brand strategy. Under the wraps was a car called Etherea, a harbinger of where Infiniti design is headed. ...Read the whole story >>
Restaurants
by Karlene Lukovitz
More than two-thirds (66%) of restaurant diners confirm that they are interested in healthier breakfast options, according to Mintel. Further, regardless of the day of the week, two-fifths of consumers who eat breakfast out say that healthy breakfast options are the "most important" factor in selecting a breakfast venue. < ...Read the whole story >>
Sphere: Related Content
Why They Aren't Buying
I admit it. A few years ago I was buying a new laptop every 18 months.
Then our economy took a hit. I've had the same laptop for 3+ years. And I have no plans to replace it.
I'm not the only one:
Consumers Holding On to Products Longer
Throw away the cellphone after two years? Not so fast. Ditch the flat-panel TV for an even thinner model? Maybe next year. Replace the blouse with the hole? Darn it!
Consumer spending has picked up, but for some Americans the recession has left something behind: a greater interest in making stuff last.
For a number of products -- cars, phones, computers, even shampoo and toothpaste -- the data shows a slowing of product life cycles and consumption. In many cases the difference is mere months, but economists and consumers say the approach just may outlast a full recovery and the return of easy credit, because of the strong impression the downturn made on consumers.
It is hardly the stuff of generations past, those stung by the Great Depression, who held onto antediluvian dishware and stored canned goods until rust formed on the lids. But for the moment, many citizens of a throwaway society are making fewer visits to the trash and recycling bins.
In the case of Patti Hauseman of Brooklyn, that meant sticking with a five-year-old Apple computer until it started making odd whirring noises and occasionally malfunctioning. She and her boyfriend bought a new computer for Christmas -- actually, a refurbished one.
"A week later, the old one died. We timed it pretty well," Ms. Hauseman said with a laugh. Her cautious approach applies to other products: She is holding out on upgrading two seven-year-old tube-type TVs, and has taken to mending clothes rather than replacing them.
Ms. Hauseman, 41, a general manager of an independent record label, said this mentality was the product of several factors, including bills that have swelled more quickly than her income. She said it was not so much that she could not afford new things, but that the last few years of economic turmoil had left her feeling that she could be stealing from her future by throwing away goods that still had value.
"I've started upgrading for necessity, not vanity," she said, adding that to do otherwise "just does feel wasteful."
Whether a broad, long-term shift in consumer habits is underway is a question tickling economists and analysts. Some insist that, as with the Depression, the recent downturn has made a lingering impression on how people view the propriety of, say, stuffing a still-working cellphone into a desk drawer in favor of a newer model.
But other experts and historians argue that as spending and credit return, so will yearnings to favor brands, fashion and novelty over practicality.
With some products, the upgrade cycle is actually accelerating. According to NPD, a market research firm, consumers in 2010 reported spending more to upgrade major kitchen appliances like refrigerators than they did in 2008 or 2009, when such spending fell. The firm found similar trends at work in smaller kitchen and personal care appliances.
In the case of televisions, upgrades have slowed, but only because so many people snapped up flat-panel sets in recent years. There is now a lull in the product cycle, but not necessarily in consumer demand.
Tyler Cowen, an economist at George Mason University, said it was simply too soon to tell whether economic recovery would bring back a more disposable society. "There aren't enough aggregate statistics since the crash for us to know," he said.
But in some important categories there are indications of slowed upgrades. Consumers are holding onto new cars for a record 63.9 months, up 4.5 months from a year ago and 14 percent since the end of 2008, according to Polk, a research firm. In fact, the firm said, when used cars are included, the average length of car ownership stands at 52.2 months, also a record.
Industry analysts also report that people on average upgrade their cellphones every 18 months, up from every 16 months just a few years ago. They hold onto their laptops an average of 4 years and 4 months, a month longer than they did a year ago, though that figure has been creeping up since 2000.
And consumers are making sure to get the last drop from their household products, said Ali Dibadj, an analyst at Sanford C. Bernstein who covers big companies like Colgate-Palmolive and Clorox.
"People are squeezing the last bit out of the shampoo. They seem to be adding more water to really squeeze out the last bit," Mr. Dibadj said, noting financial reports from major companies showing frugality with things like razor blades, laundry detergent and toothpaste. "Consumers are doing their best to conserve -- we're seeing it again and again and again."
Nancy F. Koehn, a professor at the Harvard Business School and a historian of consumer behavior, said she would bet her boot collection that the change was, if not permanent, at least lasting. She said it stemmed not just from a shaky economy but also from a sense that great institutions -- like government and major corporations -- might not be reliable saviors in a crisis.
"We're not going back to a time of our grandmothers' tales of what they kept and how they used things so carefully. But we'll see a consistent inching or trudging towards that," Professor Koehn said. "It's a glimmer of that, a flickering of it."
For Walt Truelson, a management consultant in Portland, Ore., that has meant a shift in his lifelong love affair with cars, specifically Jaguars. He typically bought a new or slightly used one every year or two, but has had his current car, a 1999 model in dark green, for four years. "It's going to stay in my possession as long as it runs," he said.
Mr. Truelson, who declined to give his age because he said he acts much younger than he is, also switched 18 months ago to paying for cellphone minutes as he uses them, rather than subscribing to an expensive monthly plan.
He said the changes reflect in part the fact that his business fell with the economy, but also what he says is a reassessment of the need to constantly have new things: "It's a question of shifting values."
In a few cases, consumers who are inclined to discard less are getting some positive reinforcement from an unlikely corner: companies that profit from upgrades.
Levi Strauss is telling customers to take steps that will actually lead them to buy fewer pairs of jeans. The Levi's sustainability campaign urges customers to wash their jeans less often and in cold water, a move that the company says reduces water use.
"And they absolutely will last longer," said Michael Kobori, vice president for social and environmental sustainability at Levi's. He said the message was part of building trust with consumers and emphasizing the durability of the company's products.
When it comes to holding onto clothing, Genevieve Tung, 28, needs no campaign to motivate her. She has recently mended ripped socks and pants, sewn buttons onto jackets and gone to great lengths to save a peach silk blouse stained by soy sauce.
"I tried several home remedies involving dishwashing detergent and baking soda, and had it dry-cleaned twice," she said. "I bought fabric dye I'm going to cook on the stove and hope the dark color dye will blend in."
Ms. Tung, who lives in Brooklyn, recently left a corporate law job to go back to school, a move that curtailed her income. She is also worried about relying over the long term on the pension of her husband, a New York City paramedic, given how unreliable pensions seem.
She says there are other motivations too: "Personally, avoiding waste and using things until they're used up seems like a common-sense way to live."
(Source: The New York Times, 02/25/11)
Tell Them
The story I'm about to share is from an occasional newsletter I get from Craig Arthur in Australia, the Wizard Chronicles.
I get my hair cut every 4 weeks.
Only about twice a year do they ever ask me if I want to buy any products.
Never, yes NEVER, have they ever told me why:
Are Your Assumptions... Restricting Your Business Growth?
Understanding Your Customer
By Sarah Ripley, Wizard of Ads Partner (Australia)
Being a consistent lover of assumption is like being a great lover of eating Fugu fish – a Japanese delicacy which contains poison in different parts of the body and can result in death of the eater if not prepared properly. It’s almost like playing Russian roulette but with your dinner.
This is how assumption works – 9 times out of 10, our assumptions will be correct, but can you afford the repercussions of that 1 in 10 occasion?
Business owners are often Fugu eaters – assuming that they know exactly who their customers are and what they want.
Consider the following case study:
A hairdresser sells high-end hair products including shampoo and conditioner, which average to be about three times the cost than that of supermarket brands.
To the average Josephine, she cannot recognise the difference other than the price – possibly assuming (there’s the Fugu again!) that the hairdresser products are most likely more expensive as they are high-end brand names and are therefore prestige pricing*.
On the contrary, there ARE chemical differences between salon products and what you buy in a supermarket as explained to me by the hairdresser. “But do customers really care that they are washing their hair in the same stuff that roads are made of?**” asks the hairdresser. “I have never had a customer come in and ask about the ingredients or chemical make-up of the products I stock on my shelves, so I assumed that they didn’t care and it wasn’t important.”
Never discount the power of information.
Never discount what is interesting.
If there is something interesting and worth telling, do it. Tell the story. Particularly, (such as this case study), where you have a captive audience sitting on their butt’s in front of you.
Not all will buy because of your story, but a percentage will. Your sales will increase simply by telling your story.
Finally – never discount an outsider being able to identify what your customers may want better than you may. Have you ever looked for something, and can’t see it, no matter how hard you look? But, when you ask someone else for help, they see it straight away?
Assuming the Business Owner Knows Best is one of the most common mistakes in advertising.
The business owner is uniquely unqualified to see his company or product objectively. Too much product knowledge leads him to answer questions no one is asking. He’s on the inside looking out, trying to describe himself to a person on the outside looking in. It’s hard to read the label when you’re inside the bottle. – Roy H. Williams, The Wizard of Ads
Sometimes it helps to bring in an objective outsider to give you some perspective, and help tell your story.
Or would you prefer to eat Fugu and take the risk?
* Selling at a high price in order to create an aura of superior quality and social status.
** Supermarket or cheaper brands usually contain rubber-based silicon in the form of silicon oil, (common chemical name is Dimethicone), which is also used in making bitumen as an anti-foam agent. Hairdressing or brands that are more expensive use silk-based silicon instead. Craig Arthur
Wizard of Ads - Helping Business Owners Attract, Convert & Delight Customers
PS. Need help to attract more customers and grow your business?
Australia & New Zealand
Craig Arthur - send an email
United States & Canada
Dave Young - send an email
Michele Miller - send an email
Tom Wanek - send an email
Call or email to book a FREE alignment meeting. No obligation. No pressure. It is at this meeting we both decide if there is a fit between our 2 companies. It is only then can we explore your options. We will never try to sell you. Call (07) 4728 4866. Sphere: Related Content
Using your ears
from my email:
Daily Sales Tip: Becoming an Active Listener
Active listening is making a conscious effort to hear your customer's words as well as to try and understand the total message being sent, both verbally and nonverbally. It requires you to listen not only with your ears, but also with your eyes. It's important to monitor your customer's body language gestures and look for congruency between words, posture, movement and tone of voice.
Are you able to stay focused on your customer or does your mind wander? By giving your customer your full and undivided attention, you're laying a foundation of trust and building rapport. Discipline your mind and put aside distracting thoughts. Each time you catch your mind starting to wander, "grab it" and immediately refocus your attention back to your customer. Show that you're listening by using your body language gestures to convey your attention. A simple smile or nod of the head conveys that you're listening without interrupting your customer's flow of thought.
The best salespeople have a tendency to listen like a homicide detective and ask great probing questions. They don't make assumptions, they summarize and seek clarity. An occasional question or comment to recap what has been said communicates that you understand the message. Until this is done, your customer will resist your input.
Source: Sales trainer/motivational speaker John Boe
Tuesday, March 01, 2011
Tuesday Night Marketing News from Mediapost
Click & Read...
Automotive
by Karl Greenberg Lexus this week launches its biggest campaign in years. The effort is the full-court press for the new CT 200h, which Lexus has been teasing for several months now with grassroots efforts and Web programs. ...Read the whole story >>
Electronics
by Aaron Baar
"Mobile phones, particularly smartphones, are bringing video game play to the masses in ways that nothing else previously has done. You've been able to play games on your computer for 25 or 30 years, but they're not things that are with you constantly. Mobile phones are making the average consumer a video game player and purchaser." ...Read the whole story >>
Restaurants
by Karlene Lukovitz McDonald's is employing a cause-related promotion on Foursquare to promote its new McCafe Shake, while Dunkin' Donuts is running a Twitter-based giveaway to promote a new Big 'N Toasty Breakfast Sandwich. ...Read the whole story >>
Travel
by Tanya Irwin
In the past, employees have been shown picking customers up or opening doors for customers, said Patrick Farrell, vice president of marketing and communications for Enterprise Holdings. "This is our first campaign featuring our employees as speaking talent," Farrell tells Marketing Daily. ...Read the whole story >>
Retail
by Sarah Mahoney It's enough to get you tapping the toes of your Dutch wooden shoes: Nordstrom and Disney Consumer Products are introducing a limited-edition collection of children's clothing to celebrate the 45th birthday of the "It's a Small World" attraction at Disneyland. ...Read the whole story >>
Automotive
by Karl Greenberg
It's all part of a program in BMW's North American market to gear up for the launch of BMW's raft of hybrid and electric vehicles coming down the pike. The effort includes a social media program called "Activate the Future" and a real-world test-drive program for ActiveE, an electric car that presages the first such car, the BMW i3 car, due to market in 2013. ...Read the whole story >>
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