When you should and shouldn’t be spending money on advertising

When you should and shouldn’t be spending money on advertising

Great advertising can do amazing things for a company. The size of the ad spend has nothing to do with results if you understand this. In fact, if you have to spend millions to get the word out, you are probably putting your budget in the wrong place.

While we are an ad agency, our name is The Next Wave Marketing Innovation for good reason. Marketing encompasses the entire brand strategy to connect with customers, and advertising is only a small part of that. Innovation is making you different from your competition, a better mousetrap so to speak. Because we’re students of the craft of advertising, we can pull stories and ads that showcase when Marketing Innovation triumphs over big ad budgets to help illustrate this point. Because we’re also consumers, we can share experiences where companies don’t have a clue on how to keep customers happy- which will undo all hard earned brand equity in seconds.

There is the old adage that a happy customer will tell 3 people, an unhappy one will tell hundreds? That’s kind of changed with the advent of the internet, everyone can tell everyone anything- even if it’s not true. That’s why from the beginning of the rise of Google as the database of human intentions, the algorithm scored results by credibility, which was built by links from those with more links (hopefully from credible sources). So, every customer interaction counts, every response by your customer service people is a test, how you treat your customers is more important than what you advertise. Actions, speak louder than words.

To start off with a positive example, Mike Dubin had an innovative idea- to become “the netflix of razor blades” when he started Dollar Shave Club in 2012. A single, low budget TV spot, that he starred in, went viral. Overnight, Dollar Shave Club was overwhelmed with orders and when he sold out to Unilever in less than a decade for a billion dollars, he was still laughing all the way to the bank. The ad was brilliant, the products passable, and the customer service exemplary (once they got over the initial slam of viral popularity).

Sometimes an ad agency can come up with brilliant ideas for their client to build a buzz. Between 2000 and 2010 Alex Bogusky and his renegade firm out of Miami did it over and over. But, the most noted campaign ideas were for Burger King, a client that had a history of switching agencies every 2 years before going a whole 7 with CP+B. For a case study on their successes see our “Bogusky Freakout” site post on their milestones. They generated more buzz worthy campaigns than any agency known to man, but, when it came right down to the true marketing problem for Burger King- service, cleanliness and consistency, BK could never compete with McDonald’s or even Chic-fil-a. One of our first hires was a customer service evangelist of epic proportions who beat this into our culture at The Next Wave. She went on to a career that took her all over the globe with Starbucks and now as VP of Operations at Shake Shack. You build businesses through positive customer touches- not just sales. It’s “My Pleasure” did more for Chic-fil-a than the cows campaign telling you to “eat mor chickn.”

It doesn’t matter what your business is, you are being measured every time a customer interacts with your brand- from watching an ad, to visiting your site, to mentions on social media to seeing trash with your logo on it. So, when an existing customer contacts you, this is your chance to shine.

Florida Tile makes ceramic tile. It’s a commodity. Most people looking at a wall of tile have no idea what brand of tile it is, it doesn’t have your brand on it, and when they go to the tile store, more than likely, they don’t have a preference for your brand over another- even if they saw an ad with Florida Tile in it. Unless the tile style isn’t like any other on the market (innovation) the tile ad you spent so much money on, could actually prompt them into a store, where they buy a competitors product. Not so when you have an existing customer calling for replacement for their shower tile cove base- that customer wants Florida Tile- to match their bath. This is the moment where your brand has an opportunity to shine. Unfortunately, Florida Tile failed miserably in helping me locate a piece of plain white cove base to match my 30 year old shower install. Last I checked square white tile is always in style, but, their unique size 4.125″ square, their white- and their cove curve- is now going for $15 a piece if someone has it on Ebay (they don’t right now).

Let’s contrast that with Lego, the children’s toy with millions of little unique pieces. A call to Lego gets a totally different response from a company that has decided that making customers happy is their most important marketing tool.

“We have something that we call freaky,” Lütke-Daldrup told me. “Freaky stands for FRKE, which is short for

  • fun
  • reliable
  • knowledgeable, and
  • engaging.

And those four words are something we’ve built our customer service on for probably more than 15 years.”

It isn’t just that Lego Group believes strongly in each of those four words. The reason the company is able to consistently delight customers, even when they’re having a bad day because they just opened a new Lego set to discover it is missing pieces, is that the company keeps these words in balance.

Hannah Quill, the company’s head of writing and tone of voice (which, by the way, is an amazing job title that alone tells you what the company thinks about engaging with customers) explains it this way: “One of the reasons that it works so well is that, yes, it’s fun and engaging, and we encourage people to be creative and have fun when they’re writing, but it’s also reliable and knowledgeable. It’s very important that you’re giving the customer the correct information, and that any promise that you’re making, you are committing to deliver that customer service. Freaky doesn’t solely mean fun and engaging, it also means following through, reliable, customer service.”

The proof is in the results. For example, the company’s net promoter score (NPS), a measure of customer loyalty and satisfaction, is 77 — one of the highest of any company. That means that being good to your customers is good for business. That should be obvious, but sadly, it too often isn’t.

“It’s essential that no matter the inquiry, the team provides the best possible answer and service while also reflecting our core values — and in doing that, they play a very important part to how people feel about our brand,” Christiansen says.

Source: Lego Customers Lose Millions of Pieces a Year. The Company’s 4-Word Response Is the Best I’ve Ever Seen | Inc.com

While Net Promoter Scores are nice metrics, they can only really be calculated for mega-brands, not necessarily small business. But, rest assured, the echo chamber of social media, where unhappy customers tell their friends about how crappy your service was, or how great you are, will have real bottom line results. Lego isn’t a huge advertising power in the toy space, however they have a product that has no direct competition- like the Burger giants, or lodging options.

AirBnB is a category disrupter in the lodging space. Hotels, resorts, destinations are now competing with individual “Hosts” who have a technology to level the playing field. I’m an AirBnB superhost and until recently- an evangelist to other hosts. Now, any recommendations to host come with a caveat- the brands vaunted “AirCover” host insurance plan with up to $1M in coverage, isn’t insurance at all, it’s marketing babble and a hoax. I had a guest who needed a place for 4 days while they were waiting for their new house to be ready. Turns out- the new house wasn’t for the guest- but for his friends- at which point I should have kicked them out- but the family was polite- and they were African- and I didn’t want to be caught in the middle of being called a racist. When they left- late, the house was more messy than normal. They also had more people in and out than the 1 bedroom cottage was built for. They cooked extensively- which is a rarity among my guests who stay less than a week.

About 8 weeks later a guest tried to turn on the oven. The knob just spun. It had been jerryrigged in place with superglue and paper wadding. I filed a claim for the $400 for parts and labor to replace the control and order new knobs. Airbnb told me I had to blame a guest- and had to do it within 2 weeks. This isn’t insurance, this is a guest blaming service. Had the guests just told me they’d broken it- it probably would have been covered, or at least the problem would be between AirBnB and them. Now, according to AirBnB it’s all my problem. Yet, here they are spending millions to attract new hosts to the platform.

Word to the wise, take care of your stakeholder partners first, advertise second. The cost of reimbursing a superhost for minor repairs is way less than the revenue you earn from their being on the platform.

I reached out to support twice and was rebuffed. I reached out on Twitter- and was ignored. Maybe this post will wake them up. Next up, a video, that could go viral, about the failings of their “AirCover” false advertising- oh wait- here’s Nightline with 8M views. Your ad on Youtube only has 52K views.

Size of the claim is irrelevant to the promise of coverage, it’s how you treat your partner. No matter how much you advertise, word of mouth will negate your expensive commercial message.

If you are trying to decide on how much to budget on your advertising each year, the first thing to do is to go out and look at your customer reviews. Make sure you’re delivering happiness first, then, work on delivering a message.

If you need help delivering marketing innovation for your brand, you’re in the right place. We help our clients create lust and evoke trust, the keys to happy customers.

 

6 easy steps to an iconic brand… you wish.

Think Small VW ad by DDB

The ad that launched the creative revolution.

Very few agencies get to launch an automotive brand. Cars are special. They’re expensive, they are an outward representation of their owners personal positioning (at least in America), and automotive brands have a special place in advertising folklore. It was VW with DDB that launched “the creative revolution” with the iconic “Think Small” ad.

Notable brand launches have mostly been new luxury nameplates from Japanese companies, Honda with Acura, Inifiniti with Nissan (which had to make the change from Datsun to Nissan before this) and Toyota with Lexus. Others were GM’s creation of the short lived Saturn, Toyota with the even shorter launch of Scion, and then Tesla.

Crispin Porter + Bogusky was asked around the turn of the 21st century to relaunch the Mini Cooper in the USA- now that it was owned by BMW. They thought they had a monumental task with a relatively small budget.

In early 2001 American roads were dominated by SUV’s – the fastest growing segment – and light trucks was the most popular segment in the category. Japanese and German brands dominated the import segment and gas was $1.25. Bigger was better. Small car sales were at their lowest point in 15 years.
MINI’s heritage was British, which was synonymous with unreliability in the car category.

Source: Gold Award Winning CP+B Mini USA Entry – Adweek

The deck was stacked, and to top it all off, there were only 2 cars in the line, the Cooper and the Cooper S. The first step was to identify what makes a brand a brand:

Mini Cooper logoWe did an exhaustive study of iconic brands across a variety of categories and discovered six characteristics common to iconic brands.
1. A defining signature look
2. An ability to elicit a physical or emotional reaction
3. A tendency to take on characteristics outside their category
4. A tendency to own a unique benefit within a category or create a new category altogether
5. An ability to connect with and reflect the attitudes and values of a broad user base
6. A tendency to break conventions and reinvent to stay salient

ibid

From there- sort of work backwards to find the mojo. With Mini there were several clues.

The car doesn’t look like any others- it’s funky. It also is a blast to drive. They worked that into the brief:

  • Showcase the defining look of the new MINI – its size and contrasting roof.
  • Create as many opportunities as possible for people to come in contact with the new MINI so they could experience its smile generating magic.
  • Subtly anthropomorphize the new MINI.
  • Communicate our unique benefit – life-affirming exhilaration at an attainable price.
  • Emphasize customization and individual self-expression.
  • Use non-traditional media and traditional media in very non-traditional ways.
Mini Cooper on an SUV being driven around a city

“What are you doing for fun this weekend?”

ibid

CP+B took this insight and did some testing. They created an “exhilaration scale” to clarify the price to WOW factor. And, then, they started looking for the definition of that experience.

At first they called it “going”- as opposed to driving, which was the operative industry word. Then, someone stumbled onto “Motoring” – it was driving- with a British twist- and “Let’s motor” was born. That, along with the badge, and distinctive non-traditional media, lead to a launch that out-lived some other small car brands (Scion) despite the car not excelling in the reliability or cost of ownership like the other newer brand launches.

Once they had a tagline, there were ads, and then there were stunts. Lots of stunts.

The ads were out of the box. Literally. Like putting a Mini Cooper on top of an SUV and driving it around a city.

Apple 1984 mac Hello ad

“hello”

The key takeaway from this post are things we at The Next Wave preach in our tagline, Create Lust • Evoke Trust. To do that, we look at those six characteristics everyday. We search for universal truths that build easy inroads to consumers psyches, and then find a way to elicit emotion that sets your brand apart from your competition. It’s what Steve Jobs did at Apple with ease of use, putting the customer first- and creating “Bicycles for our minds” – something simple- and easy- and loved, to move people from thinking of computers as distant machines that spoke an arcane language, to “hello.”

There are other iconic brands that found a powerful voice through better positioning. We’ll list just a few.

  • “Just do it” from Nike
  • “The Ultimate Driving Machine” from BMW- which they walked away from, and have recently started edging back.

What would make your list.

If you’d like to discuss crafting your iconic brand, we’re here to help you find your insight and give you the tools to own your position in your industry.

 

The new Burger King looks more likeFive Guys

Driven Thru

Burger King bowing to Five Guys?

Creative Commons License Photo Credit: Chris Nixon via Compfight

Fast food is a tough category. While McDonalds obviously has the secret sauce to the number one spot, the actions of number two through five are like watching a three ring circus. Only one can be something for everyone, everyone else, needs to figure out how to be the anti-something for everyone and pick their niche.

Chipotle is the envy of the industry- with a ridiculously low ad budget (they actually dropped from $7.5 million in measured media in 2010 to $5.8 in 2011 according to Ad Age Mar 12, 2012, “Chipotle aims to buck fast-food convention- while it still can“) and a menu that doesn’t change much and a business model that doesn’t rely on “Sales” or price off promotions. Chipotle has a value proposition: a big portion of fresh locally sourced food, that’s made to order in front of you. Subway uses part of the same model and is the number two fast feeder: A custom made sandwich at a reasonable price.

Lately, Burger King has ditched one of the hottest agencies in the country, Crispin Porter + Bogusky, cut ties with CMO Russ Klein (who has bounced back at Arby’s) and gone back on the mission to out-McDonald’s McDonalds:

The restaurant’s menu will include a record 10 new items, among them, made-to-order smoothies and three new salads. Burger King also will increase its marketing efforts, featuring soccer player David Beckham, talk show host Jay Leno, actress Salma Hayek and singer Mary J. Blige in upcoming commercials. The chain plans to send out 40 food trucks across the country to hand out food at events and set up sampling inside some Burger King locations.

The chain is reportedly attempting to broaden its menu with healthier and more snack alternatives in an effort to appeal to mothers, families and Baby Boomers. Burger King and its franchisees will spend an estimated $750 million to revamp stores over the next 12 months.

via Burger King to Roll Out 40 Food Trucks Nationwide | Mobile Cuisine – Food Trucks, Carts & Street Eating.

Burger King built their business on the Whopper- a burger that used to be bigger and tastier than a Big Mac. The company hit pay dirt when they challenged market leader McDonalds with “Have it your way” as a way to differentiate their offering as made to order and fresh- utilizing “Flame broiling” instead of frying- positioning them as the burger kings- in the same way you make a great burger in your back yard. Burger King appealed to some of the same triggers that work for Chipotle and Subway- their food was made more the way you make it at home. Home cooking beats the factory- that was a message and positioning that resonated.

To be the Burger King, all they had to do was make the best burger our there. Now, they are placing bets on salads, frappes, wraps and famous faces. Compare that to upstart chain, Five Guys. The whole business is focused on making burgers and fries. When you order- the cashier calls back the number of patties that need to be on the grill- nothing else. Take out the frying surface and replace it with open flame grilling and they would be the penultimate burger kings.The oversize portions of freshly cut fries as well as the fresh meat burgers make them the new Burger Kings. Advertising is mostly accomplished by word of mouth and the reviews posted around the store remind you that this is the burger joint of old reincarnated. Note- they don’t have a dollar menu, don’t do couponing, no TV ads either. Like the Chipotle model, the entire kitchen and process is on display.

My visit yesterday to Burger King to check out the “new changes” confirmed that BK isn’t the Burger King anymore- despite having cast aluminum burger flippers for door pulls, once I got into the line and watched the digital menu screens show me salads getting the sexy dressing pour and sundaes getting drizzled with chocolate sauce – I almost forgot I was in a burger place. The menu is schizophrenic with “stackers” for a buck- and the next step up is a burger starting at $3+. To confuse matters there are a ton of chicken offerings, salads and who knows what else. No one told me it would be at least three minutes for the “Chicken snack wrap” until after I ordered and the confusion of trying to speed things up by switching, then not switching my chicken for a second stacker reminded me of a three ring circus.

The moral of the story is to be successful, a brand has to know who they are and stick to it. That’s why the new Burger King is obviously Five Guys.

Why isn’t there customer service 2.0?

For every question I get about the wonders of “web 2.0” it’s rare that we hear clients ask “what can I do to make my customer happier?” Will a mobile version of your website make them feel better about the washing machine they just bought? No.

It comes down to customer service- and understanding that the best marketing is outstanding customer service- “marketing as a service.”

Amazon got it when an ad agency suggested they spend at least $30 million a year on ads- and instead they decided to give their customers free shipping (of course, once they started into their own products like the Kindle- they had to start advertising).

One has to credit Crispin Porter + Bogusky for taking on Domino’s Pizza- and not only telling them that the quality of their pizza is the problem (they probably told VW that being below average in the JD Power car quality charts wasn’t helping sales too) but getting the company to pay money to tell customers that their pizza did suck, but it’s better now:

You can spend all the money on marketing you want- just remember, if your product or service is less than stellar- good advertising will only kill your product sooner.

That’s the beauty of web 2.0, not, when you screw up, someone will tell a lot of people- either on your site, where you can respond and try to fix it- or on anyone of millions of other sites, including their own- where you may or may not be able to respond. If you haven’t set up Google Alerts on every product name, company name, key people in your business- you may be finding out the hard way when things are going wrong.

If there is one place we need customer service 2.0 it’s government. Unfortunately, most politicians and bureaucrats think they are immune from finger pointing (although they’re all aces at it). The rest of the nation already understands the value of open, honest communication, unfortunately we’re still doing government with rules from long before the information age.

If you want an in your face take on customer service, I give you Gary Vaynerchuk of Wine Library speaking at SXSW (parental advisory for naughty words):

As a parting thought- thanks to Gary- it also doesn’t hurt for your company to have a personality either. Try reading “Personality not included” by Rohit Bhargava- it’ll wake you up to what kind of service is possible with personality.

There is no “App for that” when it comes to customer service- it all comes from the choices leadership makes. Advertising or free shipping? Quality product or lower pricing? A warranty that customers can believe in, or a legal trap to play gotcha?

Customer service should be first on everyone’s mind, everyday, because there is an app to tell the world when you screw up- you’re looking at it now. Comment below at will.

Ads you want to watch, and ads you don’t (but do anyway).

We live in an attention society. Everybody wants it, few get it, and all of us give it.

Advertising legend Howard Luck Gossage said “People don’t read ads, they read what interests them and sometimes it’s an ad.”

In today’s marketplace, people watch and share the outrageous. The question is, is it outrageous in a way that extends your brand message? Is it something that helps you make your point about why brand X is better than brand Y?

Evian, a company that sells the most commoditized product in the world- water, gives us an entertaining ditty with babies roller skating to the track of “Rappers Delight”- anyone 40 and older- their core market, remembers this song, and thinks babies are cute. This ad will get a lot of positive spread.

Then, there is an ad, probably done by the bad boys of advertising, Crispin Porter + Bogusky for Internet Explorer 8 and it’s private browsing feature. You’ll watch this- go, eehhwwwwww- and then tell 10 friends. O.M.G.I.G.P. or “Oh, my god, I’m gonna puke”

If given the choice, which would you prefer represented your brand? And, if trends continue, the puking woman is outscoring the babies in views on YouTube by a landslide, so think carefully.

Why Crispin Porter + Bogusky is the reigning king of Hoopla (advertising)

Crispin Porter + Bogusky is proving why they are at the top of almost every agency search consultants list. Burger King continues to have same store growth after years of failed campaigns, and changing agencies. VW was almost ready to give up on the US market, again, but have at least started to rebound sales. But what started out as an embarrassingly bad intro for Microsoft with Bill Gates and Jerry Seinfeld, and then into an “I’m a PC” has now hit pay dirt by not even talking about Microsoft’s products, but by doing a comparison between PC hardware and Apple hardware.

“Laptop Hunters” is credited with changing perception of brand value, according to a BrandIndex study:

Based on daily interviews of 5,000 people, BrandIndex found the age group gave Apple its highest rating in late winter, when it notched a value score of 70 on a scale of -100 to 100 (a score of zero means that people are giving equal amounts of positive and negative feedback about a brand). But its score began to fall shortly after and, despite brief rallies, hovers around 12.4 today.

Microsoft, on the other hand, has risen from near zero in early February to a value-perception score of 46.2.

via In Mac vs. PC Battle, Microsoft Winning in Value Perception – Advertising Age – Digital.

Hefty gains in a short time, although Apple hasn’t sat idly by:

But, while this battle royal can wage for years, the real reason that Crispin Porter + Bogusky keeps winning for their clients is that they get the fundamentals right.

They know that advertising is supposed to surprise and delight, not inform and sell. They take great pains to make sure that you might actually want to talk about the ads they do around the water cooler at work the next day.

Today, they pulled one out of the hat for me. I own a copy of “Hoopla” which is their monograph. For the most part, it’s heinously designed making it almost impossible to read, but, inside the back cover- I discovered (via a tweet by Alex Bogusky) there is a secret second book:

This guy @DomineConcept discovered the hidden book that was bound inside the back cover of our book Hoopla » link to Dominé Concept | Hooplanetics and a ripped up HOOPLA book….

Which led me to carefully operate on my $50 copy:

A secret book awaits inside the back cover

A secret book awaits inside the back cover

I’ve also been watching the CP+B Ebay auction of their interns time:

ANNOUNCING THE CP+B INTERN AUCTION

In the past, our interns have created work for companies like Burger King, Volkswagen, Guitar Hero and Microsoft. And now they can do the same for you. Bidding starts at $1 for three months of service with all proceeds going to the hardest working people we know – the CP+B interns themselves. So bid early and often, and world-class advertising can be yours for a fraction of the going rate.

via Crispin Porter + Bogusky Intern Auction: Summer 2009 – eBay (item 270392380113 end time May-27-09 10:57:37 PDT).

Which is currently going for $5,400.

It’s innovative, it’s interesting and it’s not strictly advertising. It’s a conscious effort to manipulate and shape contemporary culture, cajoling and dancing outside the boundaries of conventional advertising wisdom. Everything can be an ad if you make it interesting enough.

And that’s why they are winning awards, accounts and owning the crown of the Hoopla kings.