DIGITAL-ERA MARKETING– MISUNDERSTOOD AND UNDER-UTILISED
“Digital era” and “Digital marketing” are two phrases and concepts that are largely misunderstood and therefore under-utilised.
For some, both are confronting, intimidating, overwhelming.
They need not, and should not be so.
An overwhelming majority of digital marketing campaigns fail to achieve their optimum because of a lack of direction, focus, purpose and integration.
Practitioners flounder because of a lack of understanding by their clients – business owners – resulting in an absence of a briefing, and leadership and understanding.
The digital era is characterised by disruptive entrepreneurism. However, those disruptions should, and indeed must be positive.
It is not necessarily a generational difference issue.
Digital is a non-negotiable imperative for all entities, just as computers, information-technology, world-best practice and zero-based budgeting were, before it evolved.
Business owners and leaders do not need to be experts in the disciplines of accounting, engineering, law – or digital applications.
They simply need to develop awareness and skills in their nature, relevance and deployment, for the benefit and betterment of the business.
Allowing free-range development of digital marketing strategies, tactics and applications is ill-advised and inevitably both expensive and sub optimal.
Declaring that one has a digital-marketing presence is similar to “free-range” eggs. It makes someone feel good, but it doesn’t necessarily result in improved performance, quality, profitability and competitiveness.
Digital marketing is not a stand-alone discipline.
It performs and contributes best when it is integrated, coordinated and complementary to existing and appropriate strategies.
MISLEADING BUSINESS STATISTICS
Statistics can be confusing, contradictory and difficult to comprehend.
Single-set figures and ratios can be, and often are, outright misleading.
Take for instance the recent national and state-based retail turnover data released by the Australian Bureau of Statistics.
Retail sales for the past 12 months were reported to have increased by 4.3%.
Very commendable, on the face of it.
However, the raw data contradict the realities of the national, state, regional and local retail sectors.
Increasing bankruptcies, store vacancies, widespread rent abatement and peppercorn rental payments are symptomatic of an industry under pressure and challenge.
Achieving growth in top-line statistics is relatively easy to achieve.
Many retailers are implementing such strategies.
Discounting prices by 20%, 30%, 40% and 50% can do wonders for turnover.
The disturbing downside consequences are evident in appalling margins, profits and financial viability.
Each of the four statistics so far mentioned is not the fundamentally required criteria that need to be measured, monitored and optimised.
Many businesses, retailers in particular, do not recognise, respect and utilise the three sets of statistics which materially influence and improve turnover: margins, profits and substantial finance viability.
Increasingly, astute business leaders are looking beyond accountants, advertising agencies and digital marketers to formulate, document and implement strategic marketing and business audits. Seven key statistics highlight the fact that we do not operate in a two-dimensional world or marketplace.
LEADERSHIP – WHAT IT TAKES
Nations, commercial sectors and businesses provide clear indications that they are on the wrong track when risk-minimisation and rule-making are the overriding philosophies, priorities and practices.
Evidence of both is all-pervading at present.
In some instances, inertia is compounding the circumstances.
Two characteristics are common and conspicuous among those entities, economies and communities that exhibit and enjoy success … – risk-taking and rule-breaking.
Some consequences are quantifiable …- increased revenue and profits.
More significant are the qualitative (attitudinal) attributes evident among staff members, clients, customers, suppliers and associates … – confidence, pride, enthusiasm and urgency.
Transition between the two risk-taking and rule-breaking, followed by increased revenue and profits – does require conscious thought and a quantum leap.
Above all else, nations, sectors and businesses are looking for … LEADERSHIP.
Success and relevance can be, and often are, attributed to many factors.
Some are valid.
More seem to be spurious.
Job applicants often espouse the virtues of having worked with market-leading entities with recognised and respected attributes.
A recent experience highlighted the need for prudence in evaluating another’s worth.
Following completion of an outstandingly successful brief, I had been directed to a local government authority about a proposal that we lead an initiative to enhance service excellence.
An associate and I were directed to a middle-level executive, whose responsibilities included customer service standards and the delivery of such.
He waxed lyrical, long and loud, about having previously worked with Telstra.
In current times the Australian market-leading telecommunications giant has lifted its game in service delivery, to the extent that it has gained considerable market share.
It has also become a noted employer-of-choice for those seeking employment and fulfilment.
The question did arise in the minds of my associate and myself: Why would one seek to leave Telstra and join this outer metropolitan local government entity?
Further consideration was given to the fact that the Telco was actively endeavouring to retain its very best people.
The scenario which unfolded was self-explanatory.
A lack of follow-up, unanswered telephone calls and general inertia soon revealed the true attributes of the individual, none of which could be assigned to Telstra.
Sadly, here was an individual who had presumably been recruited because of his experience with a leading service provider, and was now leading a team in pursuit of enhancing service delivery, and yet was clearly inadequate.
Being exposed to the ideals, values and philosophies of excellence does not ensure or suggest that such are comprehended, embraced and imparted.
One needs to go beyond those who self-attribute certain laudable values, and associate with those who understand, believe and commit.
In this instance we decided attractive alternatives and opportunities existed, which would be both more compelling and rewarding.
Therefore, be aware, be alert and be discerning when attributing values, and hence, expectations when seeking to establish new connections and relationships.
Self-attribution has few virtues.
VALUABLE LESSONS FROM PRODUCT FAILURES
Product failures, it seems, are inevitable.
Steven Jobs, founder of Apple had a refreshingly candid philosophy about the issue:
Fail big, fail fast and fail often.
Indeed, some iconic and global brands are serial offenders, or perpetrators, depending upon your frame-of-mind. No-one, no entity, product or service is immune.
The lessons learnt are invaluable, and accessible to all. Sadly, too few business leaders and marketers are alert and aware of the circumstances, the causes and the often very expensive consequences.
Coca-Cola, justifiably, stands proud and conspicuous among the great brands, companies and marketing entities around the world.
A striking endorsement of its worth is the substantial shareholding retained in the parent company by the Warren Buffet-led Berkshire Hathaway group.
Its recent introduction of Coke Life, with stevia as a natural sweetener, has been, reportedly, less than stellar.
Sales in the first 5 weeks of trading throughout Australia achieved an estimated 7 million litres. That pales against a similarly inspired new product development, Coca-Cola Vanilla, which reportedly, registered sales of 14 million litres in the same initial period.
Coke Zero was a success story, with a reported comparative 30 million litres in sales.
A corporate executive stated recently that Coke Life may achieve a 1-2% market share of the Australian cola sector.
The statement has the hallmark of a pre-emptive death notice.
What went wrong?
The global sales of soft drinks, cola in particular (which represents more than 80% of revenue in the sector throughout Australia) are declining.
Indeed, 2015 will be a benchmark year as the sales of bottled water exceed those of bottled soft drinks.
Those in the key market segment, 30-45 years of age, are increasingly sensitive to weight-gain and obesity.
Artificial sweeteners are not appealing and recent academic research has concluded that consumption of artificial sweeteners over an extended period of time can increase its consumers’ girth.
Standard Coca-Cola has a long history of appealing to the younger, active youths.
They can and do readily “burn-off” the reported 12 teaspoons of sugar in each can of Cola.
For the more sedate consumers, that will require a 40-minute run … calories are like that!
Thus, the potential lure of stevia, the new sweetener, is only a marginal factor in marketplace appeal.
Another issue is the green labelling.
Green is not a good merchandising colour for products that are consumed into the body.
The late Dame Anita Roddick, founder of Body Shop has a lot to answer for.
Her use of green did introduce an acceptance of the colour for products that are typically applied to the body, not ingested.
Green may also be acceptable for BP (British Petroleum) in its implicit and explicit positive message about the importance of ecological sustainability.
The success rates of line-extended products and services are declining. It is important to be true to the market positioning of the product and the target marketing of primary consumers.
Colgate-Palmolive’s entry into the microwave-heated snack market was somewhat less than a resounding success.
It seems that was simply a “bridge too far” for consumers, who were happy to brush their teeth and to clean their crockery with Colgate and Palmolive products but not ingest such.
GET IT RIGHT
Good, relevant market research minimises risk and improves the prospect to attain the status of relevance. It does not ensure success.
Projective research, in which respondents are asked to project their actions, buying patterns and behavioural traits, is of questionable value and accuracy.
Steven Jobs declared that is was not wise to ask people what is was that they most wanted, given that which they were not able to presently get.
He concluded most people didn’t know, had not thought about such, and didn’t have the answer.
It was his contention that entrepreneurs should develop products, services and applications, then “tell ‘em” and “sell ‘em”.
In 1975 Coca-Cola responded to the Pepsi-Challenge, in which consumers were invited, to nominate their preferred “blind-tested” cola drinks that they tasted from unlabelled thimbles.
Not surprisingly, over 75% nominated the Pepsi-Cola, with its higher sugar content (reportedly 14 teaspoons per can).
Coca-Cola rapidly introduced New Coke, with a higher sugar content.
Moreover, it was withdrawn from the market after just 79 days.
The key lesson learnt was that Coca-Cola and Pepsi-Cola are not typically consumed by the thimbleful.
A full can of New Coke was just too sweet for its target audience.
The traditional Coca-Cola recipe had been retained and branded Classic Coke.
Very appropriate – a classic case study on the need to manage and to meet consumer expectations.
Pepsi-Cola didn’t learn those valuable lessons.
It subsequently introduced Crystal- Pepsi which was a clear cola drink.
Consumers, it seems, knew that real cola drinks were never transparent.
The product stayed stuck to the retail shelves.
Success can be so fleeting.
John Sculley was the Pepsi-Cola executive who led the Pepsi-Challenge campaign.
He was lauded internationally for his marketing and leadership brilliance.
Sculley was subsequently recruited to lead Apple.
He supposedly conducted a forensic strategic audit of the company.
A major weakness was identified … Steve Jobs.
The founder was sacked.
Sales fell, so too did the company share price.
New products development dried up.
John Sculley soon joined the ranks of the unemployed.
After several years in the corporate wilderness Jobs returned to Apple.
It was a key factor in the introduction of iPads, iPods and iPhones.
On a platform of fail big, fail fast and fail often, Apple has become one of the world’s highest capitalised entities and a brand leader.
ASK THE RIGHT QUESTIONS
The probability of product/service failure can be lessened if one asks the right questions of the right people.
Arguably, the biggest marketing failure in Australia during the twentieth century was the product of extensive and intensive research.
Leyland, the British-based motor vehicle manufacturer, asked Australians what they least liked about their present motor vehicles.
The findings were resounding.
Put simply, the boot (trunk in the American vernacular) was not big enough.
Leyland promptly designed a big boot, attached an inadequate vehicle to it and launched the P76.
Alas, the company lost hundreds of millions of dollars, and is no more.
What questions were not asked included whether car owners would compromise aesthetics, leg room, space and power. Clearly they would not, and did not.
Ironically, the few P76 sedans that remain in Australia command a hefty premium … good for some quirky individuals, but not for a corporation seeking volume sales.
Barry Urquhart of Marketing Focus is an internationally respected keynote conference speaker, business strategist and consumer behaviour analyst.