Read Betweeen The Lines

As a former journalist, the recent flurry around declining newspaper revenues and the potential shut down of major news institutions like the Boston Globe (NY Times Threatens to Close Boston Globe) doesn't surprise me. The news, however, has reinvigorated the discussion around the business model of print media. The disruption has been fueled by many changes, but primarily by the advent of the web as a free content resource: craigslist.org, for instance, that ripped big chucks of revenue from local newspapers that fed off classified and print display ads to underwrite their production and circulation as well as the proliferation of citizen journalism and blogging.

Local TV News now finds itself searching for answers on attracting and monetizing local coverage in light of declining television viewership and a rise in mobile. It faces an equally challenging landscape as studios and networks are bypassing affiliate stations to take content direct.

We have needed changes to journalistic practices and business models for years -- far longer than the slow erosion we're seeing now. Granted, the NY Times, NPR and the handful of credible news outlets have kept the journalistic bar high, but the reason most media companies have failed to navigate is that they -- like many other companies -- are more inwardly focused on operations and margins than on satisfying the appetite of their consumers. Hence, we see the death march for media companies continue.

As a marketing consultant to high-tech as well as media companies -- I have been pressing on just this point. In fact, late last week I was talking to a prospective client, this one a new media company. I asked the President early in the call, "Who is your primary customer?" The answer that came back was alarming -- he couldn't tell me who his prime customer was and what they wanted. When I pressed him to spend some focus and time on figuring that out, he told me that wasn't as important as trying to figure out how to grow that ad network. I knew in that second that we couldn't work together if the consumer isn't even a priority, let alone the driver for innovation and monetization.

Read between the lines: A lot of new online media as well as the dinosaur local TV or regional newspapers have done what many in the high-tech field have done -- they forgot at the end of the day who it is all about. Read between the lines: Connecting your content to customers will unveil monetization and business models that may not only help these companies to survive, but to thrive as well.

Later...Lisa

Yeah, Yeah...It's Still About Doing More With Less...Again?!?

March came in and left like a lion, from the conversations we've been having, and April promises more economic optimism.

Companies have cut as deeply as they can to preserve cash. Venture capitalists examined every company asking some tough questions that may have gone unasked two years ago. Instead of, "Is there a pony in there," now it's about, "Can this dog really hunt?"

What does this mean to us as marketers? We need to look beyond just budget cuts...we need to cut unproductive processes. I've been in marketing in other economic downturns, the budget shrinks. This time, budgets are being cut across the board, not just within marketing. At the end of December, Gartner wrote a great note about the the impact of cuts for sales and marketing, estimated at an average of 20% across the board.

I've always operated from a zero budget perspective because bottom line matters, and so does cash. As marketers, there is always a way to accomplish goals and not let budget dictate marketing effectiveness. The trick is to manage the internal barriers -- power struggles, time managing up , down and sideways -- and not let them become an inhibitor to overcoming market barriers.

But don't stop at the budget: Cut unproductive cycles that cost marketers time and money. Stop using powerpoint and start having conversations with your customers and sales constituents on the message you're conveying. Really understand if it works. Is there proof to back up your message? If not, use the imperative to prove your message as a catalyst to reach out to your customers and learn the real value of your product or service. Then you can leverage the customer community to tell that story. That is way more effective and and less expensive than banner ads, major rebranding and big trade show investments.

We've worked tightly with one company who, because of early work to craft compelling market-based messages and demos for sales requires less "push" marketing because we've crafted that holy grail of "pull" in the market. It is hard work and requires innovative approaches and a methodical process to unearth the messages or story. But once you have it, the market will market for you.

Downturns are great times to innovate processes and achieve focus: On your story and your market. And with that comes results...more with less!

Lisa

The Importance of Listening

Happy new year, all (yes, it still is new)!

The new year is a time for changes, for starting the new and shedding the old. And so we are. After a great deal of consideration and sincere comments from people we respect, we have decided to rename our project, our concept our book from Fear of Marketing to, well, we're not sure yet, though we have some ideas. We listened, we heard.

While the name Fear of Marketing is provocative, which is one of the reasons we like it, we get that if we want people to listen to us, we need to impart a positive message. As an adolescent, I spent many hours in junior high in the counselor's office, where he had picture of a road with a big yellow line down the center that sat directly in my view when I sat in the chair next to his desk. It had a caption that read, "Respect is a two way street." Being a problem child had its perks, like getting out of class by getting sent to the counselor's office, I learned something in those many hours: Respect is a two way street. We get that if we want people to listen to us, we need to listen, too.

So as we're changing the name of the blog, we get a new logo design and very likely will change the look, including the color scheme. So we ask you? What do you think? Be honest. We crave your input. Why? Because we are market driven. (In corporate speak, "We eat our own lunch," or in the more colorful vernacular, "We eat our own dog food.")

Good marketing is about listening to your market. So tell us... What do you like about the look and the layout? What don't you like?

We're out here...listening.

Happy Holidays

We're taking the rest of the year off...have a great holiday and new year. Check back in early January for a new post.

Lisa, Michael and the team at Cinterim.

Simplifying the Complex

Whether it is marketing or development, you gotta admit that tech companies and their teams struggle to simplify the experience and the message for their customers. Why is it that our DNA tells us that more is better?

Take the Chumby, for example. Ever heard of it? We heard about it over lunch with a PR maven back in the spring, but it never hit the radar until the other day. What is a Chumby? (We know you're dying to know!) New York Times technology editor, David Pogue, described it best. In his words, the Chumby = Alarm clock + Radio + Wi-Fi Internet + Digital picture frame + Gaming Console + Email terminal + Video player.

Business Week just published their 2008 Best and Worst. As suckers for such lists, we scanned the list and, lo and behold, the Chumby is sited as 2008's Most Disappointing Product. Ouch! Not a chummy report on the Chumby. In short, the review cited that the Chumby fell short on the user experience, calling the Chumby hard to use, with primitive technology and missing capabilities, like a battery, with a high price tag of $180.

Think about it: Does the target Chumby customer really need all those bells and whistles? And an Internet connection with a clock radio? Yet one more separate device to capture news? And Music? And email? Check out the website: It doesn't say, in any simple way, why the Chumby should my next device. Despite the fact that people like the tactile feel of the thing, the product it seems, and its marketing, are too complex. Simply put: Does the world really need a better alarm clock?

HELLO! It isn't about features. This is just one example of overly complex technology that falls short on delivering a compelling user experience. And after two years ion the market, the Chumby is now at the mercy of a tough economy.

Ever heard of MusicNet? We hadn't either. But if features were the ultimate win, then MusicNet, a 2002 online digital music service backed by several record labels, would have blazed the market and won instead of iTunes. However, even with all kinds of features and a low price: $10 a month for 100 streamed songs and 100 downloads. The experience fell short, considering downloaded songs expired after only 30 days and every song renewed counted against your allotment. (This kind of market disconnection is not surprising, considering the lack of customer focus the record labels have had in recent history. Check out our blog on the issue.) ITunes simplified access and the experience. And we all knew how that worked out.

(btw--MusicNet has since been purchased by a private equity group and recast as a back-end solution for consumer brands, all the way to delivering white-labeled digital music stores.)

Overall, the message is simple. Marketing and high-tech firms alike need to simplify the complex. Here are 3 simple steps to consider:

1. One of the hardest elements of simplifying the complex is making choices on what is most important to the target customer and what differentiates your product or service from everything else.
2. Speak to their customer in their language, not yours.
3. And finally, boil it down until it is so simple it is obvious.

Nintendo reinvigorated their presence in the gaming market, not by trying to leapfrog with features like their competitors did, but by focusing instead on the experience and an under-served market that hadn't warmed up to video games. And we can attest after playing with our Wii consistently for the past couple of months that Nintendo simplified the complex and the result is sheer joy!

It's hard work to simplify the complex, but worth the trouble. Try it. Your customers will love you for it. And so will your CFO.

Lisa

Profit vs. Innovation? Hmm.

It's been a long time coming, like the song says, and its been a long time gone. It, in this case, is our blog. And we apologize for the lag in postings. With our growing business and an economy "on the brink," we, like everyone else, have gotten mildly (!) distracted. Thank you all for your patience.

That said, one of the most important issues on every one's minds these days is the current and future state of the the automotive industry. Despite industry protestations, there seems to be little debate in the rest of the world that they brought this on themselves. The question, however is not if, but how. In a recent New York Times article, entitled At G.M., Innovation Sacrificed to Profits, the most telling comment came from General Motors board member, former Kodak CEO and Chairman, George M.C. Fisher.

"We were late on hybrids," Mr. Fisher is quoted as saying. "Why were we late? We made a business decision as opposed to a marketing decision. That's probably a mistake in retrospect." [emphasis added]

Wait a minute! Did he just that marketing isn't business? Hold that thought, because here's another one: As much as the article lambastes the the company for lack of vision, the story's headline implies, whether intentional or not, that profits and innovation are at odds. That's absurd. Nothing could be further from the truth. However, innovation usually means longer-term profits through fulfilling a business strategy. The real headline should read, "Innovation Sacrificed to Short-Term Profits."

So, if G.M.'s executive leadership team considers marketing as something separate from business, and has traded long term growth for short term transactions, what does that say about the company? Well, it tells us at Cinterim that General Motors, the quintessential American automotive company, is riddled with a fear of marketing. It's really not all that surprising in an industry that was birthed with Henry Ford's infamous comment, "I'll give them any color they want, so long as it's black." When get right down to it, after all, the auto industry is technology driven.

The importance of corporate culture in the fulfillment of business objectives has never been more apparent than it is today in the clear dysfunction within General Motors. In an industry that was built on making accessible a product that advanced consumer's lives; in an industry that was predicated on the assumption that accessibility was enough, there is no culture of listening to the voice of the customer. Listening to the customer is called marketing, which General Motors didn't consider a good business measure to make decisions. In light of Henry Ford's comment, it's a small step to see that the automotive industry has a historical "disaffiliation" with their customers. It has taken a century -- G.M.'s market share has slid consistently since the early 60s -- and an economic crisis to bring it to bear, but the results are clear. In this context, it is clear from Mr. Fisher's statement that G.M has pursued short-term profits at the expense of long term business objectives.

This is what we call a marketing dysfunction. The tell tale signs? Shutting down the voice of the market, in this case the car buying consumer; innovating features instead of products. How many different ways can you make a heater function, or make headlights or a radio work? And then there the issue of fuel economy: 35 years have passed, 3-1/2 decades since the first gas crisis erupted in 1973. It seems to us that there was more than sufficient time between then and now to build fuel-efficient engines. It's our belief that these issues are based in the disconnection the company has with it's customers. But this marketing dysfunction is not happening within the marketing discipline. It's a dysfunctional relationship within technology companies. Separating out marketing from business is ludicrous: Marketing is business. In fact, what Mr. Fisher admitted was that the company simply didn't see the need to listen to the voice of its customer. Now General Motors, and the industry as a whole, is paying the price and dragging the rest of us in its wake.

At his first appearance before congress several weeks ago, G.M. CEO Rick Wagoner said, "What exposes us to failure now is not our product lineup, or our business strategy, or our long-term strategy." He blamed it solely on the economy. Without a doubt, the economy is playing a key role here. But G.M. has been losing market share for over 40 years. Mr. Wagoner returned to Congress last week, hat in hand, promising innovation. From the sounds of it, he's talking about innovating process and streamlining the company, both of which are sorely needed. Other than pairing down product lines, there doesn't seem to be much talk about innovating new products that customers crave! (Remember the customer, Rick?)

The thing about the fear of marketing is that it is myopic. Those that have it are inherently focused inward, not on the customer. If G.M. doesn't heed the voice of its buyers, then any bailout is only slowing down the company's eventual demise. In this economy, or any other, General Motors needs to face and eradicate its fear of marketing, reinvent its process and culture and, in doing so, reinvent its business.

That's our opinion. What do you think?

Who Was Really Napping?

What if I told you that major international companies were suing their customer base? Sounds a little ridiculous, doesn’t it? Now here’s the really ridiculous part: It’s true.

Yes, everyone loves to bash the record labels. And, to some extent, they deserve it. What were they doing when the world went digital? Happily selling CDs, of course, convinced their fortunes were set for eternity. They forgot 3 things: 1) the customer, 2) innovation and 3) the customer. Did I say the customer? When you get right down to it, this is about listening to the customer. It's about the very real impact of a very real Fear of Marketing.

It's like this:
The major labels were happy enough with the innovation of the CD. It was small and portable with amazing sound. And, even better, it meant that everyone had to replace their LPs and their (yuk!) cassette tapes. (Personally, I never warmed up to cassettes ⎯ the sound quality was waaay too bad!) So for over a decade, the heat was on with reissues galore as baby boomers, their younger cousins and siblings replaced LPs with CDs. And of course there were the ongoing releases of new music and artists.

Then Napster reared it’s head (whether that was ugly or beautiful depends on your point of view). People were trading music instead of buying it. So what did the record labels do?

1. They carefully studied the phenomenon, using the technology to better understand their customer and learn to create an environment that will make trading MP3s for free an undesirable option.
2. They invested in secure watermarking technology that would make it impossible to trade songs without paying for them and converted all their assets to MP3s. (In fact, Napster founder Shawn Fanning undertook just that solution with a company called Sno Cap using watermarking technology developed by Phillips Laboratories. No major labels have used it though, and the company has been acquired by one of its former partners.)
3. They threw up their hands until profits started to drop then blamed their customers for making a poor choice.

What was missing from the recording industry’s analysis? The customer (After all, wasn't it the customer who was doing all the damage?). In all fairness, the Internet sprang to life in the 1990s and changed business by creating online giants that gave some real competition to the “brick and mortar” retailers. What changed with Napster in 1999 was that media itself, not the medium of distribution, became commoditized.

This was a shock to the media industry and sent ripples that have become waves. Now I’m not proposing that trading music illegally is right. But what is the customer telling them?
I remember an interview I once read with music legend and entrepreneur, Les Paul. Not only did he help create the solid-body electric guitar, he was a key driver in multi-tracking recording. The musician’s union, as I recall, told him he would put musician’s out of work. In fact, there are more working musicians now than there were then. Why? Because recorded music reaches in to the hearts and souls of the consumer. The new technology made it easier to do that.

So here’s the conundrum: Is it better to put your finger in the dike (translate: sue your customer base), build a new damn (translate: find a different solution that doesn’t put you at odds with your customer) or head for higher ground (translate: reinvent your business to map to the current landscape)? My father used to say, “Don’t bite the hand that feeds you.”
The finger-in-the-dike is a short term solution, but come on guys, it’s been nearly a decade. That doesn’t really qualify as a “flash flood.” Building a new damn seems to be where things are headed, but how long can it stand against a rising tide? This is the age of the wiki and people are wiki-ing music. Whether by design or default, the international community has begun to rewrite the copyright laws. The question is whether the business community, the big labels, can get out in front of the tsunami.

In my opinion, the record labels get the "Asleep-At-The-Switch" award: They should have been paying attention. I'm not feeling sorry for anyone, but here's something to think about: Radical changes call for radical solutions. Try talking with your customers, not at them. Maybe it’s time, in the words of Monty Python, “for something completely different.”

Maybe it's time to start listening. Try it, in between some of those lawsuits.