Bloghound

This is a new map of what the emerging news ecology looks like, based on a Value Network Mapping and Analysis tool developed by Verna Allee for the recent NewsTools2008 conference among 150 journalists, technologists and educators. Talk about change!

According to journalists and bloggers Chris Peck, Peggy Holman and Stephen Silha over at Journalism That Matters, here’s what’s emerging:

• Some reporters become “beat bloggers” tapping into networks of bloggers to bring complex stories into focus.
• “Community weavers” create a sense of community among the former audience and with formal news entities.
• “Information architects” make intelligible the vast amounts of data and images now available.
• While editors continue to be sense makers, connecting facts and making story lines visible, ultimately who filters news from noise, how it happens, and who pays for it is still unfolding.
• Even the definition of “news” is up for grabs as memes — cultural units of information equivalent to genes in the body — replace an event orientation to story.

Fascinating model that can be applied to traditional media, online communities and social networks, or company communities for customers or employees.

Last week I had lunch with an editor of a major daily newspaper who is trying to innovate his paper. The question his execs keep asking: “How do we make money on a different kind of model?” As with this news ecology model, no one has figured out a magic money making model. In fact, if newspapers don’t downsize fixed operational costs like printing presses and distribution assets, they may never be able to make model in this new world.

What is clear is that if newspapers do nothing as they wait for the magic model, they will continue to lose their customers, many of whom are no longer just “readers” but active participants. Ditto for marketers and corporate communications execs.

Getting management to buy into innovative marketing approaches can be tough.

Here are six facts to support change, based on performance data that Copernicus Marketing Consulting has collected from more than 500 marketing programs (consumer and B2B products and services.)

1. 84% of programs are resulting in declining brand equity and market share.
2. Customer satisfaction averages just 74%.
3. Most acquisition efforts fail to reach break even.
4. No more than 10% of new products succeed.
5. Most sales promotions are unprofitable.
6. Advertising ROI is below 4%.

For more, see the Harvard Business Review article, “Don’t Blame the Metrics” by Kevin Clancy and Randy Stone.

   The buzz is that CBS may “divorce” itself from anchor Katie Couric long before her contract expires in 2011. What went wrong?

Maybe it has nothing to do with Katie Couric or the fact that people are tuning out of  television for their news.   Maybe it comes down to a Viagra problem.

Watching the evening news — CBS or the other networks — we are bombarded with ads for one medical ailment ad after another. Penile erection, bladder control, constipation, bone loss, arthritis, diabetes. What kind of customer experience is this? Terrible. Erections and constipation happy messages while trying to make dinner, and maybe catch up on the news.

CBS, like most companies, has different silos responsible for different functions, and no one organization is looking at the customer’s experience. CBS News is responsible for Katie & Co., while the advertising group is bringing in the television dollars — and the Viagra ads.

In many retail companies, marketing is responsible for branding while operations oversees the stores, and never the two shall collaborate, often creating a mixed message and uneven customer experience.  Similarly, customer service isn’t usually part of marketing, yet the customer service group often has more influence on customers than advertising, promotions, or pricing.

I hope CBS doesn’t put the blame for poor ratings on Katie Couric, a fine journalist. CBS has bigger issues; the customer’s experience matters more than the ad revenue. If the first is bad, the second will become disastrous.

I feel both exhausted and encouraged from this week’s Conference Board conference on Measuring Marketing Effectiveness. Exhausted because the data shows that despite so much talk for so many years about the need for measures and ROI , we marketers have made very little progress over the past 10 years.

A 2007 ANA study found that just 11 percent surveyed said they are very satisfied or satisfied with their ability to determine marketing ROI. A soon-to-be released Conference Board study found that none of the companies surveyed feel as though they’ve “arrived” at figuring out a good way to measure marketing.

Exhausting, too, because creating approaches that provide insights and guide planning - vs. simply measuring tactics — is hard, scientific work. Companies with successful measurement systems, like Eli Lilly, Unilever, MetLife, said it takes at least three to four years to begin making real progress.

The only measure that may matter?

What was encouraging, however, is that marketing measurement innovators believe one approach is particularly valuable: measuring customer preference or perceived value, which are leading indicators of revenue, profits, and cash flow. (In other words, a measure that helps you manage and satisfy the CEO and CFO AND see glean insights to help manage vs. simply measure marketing.)

Don Sexton, professor of marketing at Columbia University believes that this is the most effective measure, yet is missing from nearly every list of marketing measures. (FYI: Don is releasing a book on the topic this fall.)

Other takeaways:

Relationship preference matters as much as product preference

Mark Kershisnik of Eli Lilly believes (and has the data to back it up) that equity can provide a measurement of both investment and performance, and the way to measure equity is by assessing product brand preference AND relationship preference.

I found this especially interesting as so many marketers focus exclusively on product preference, yet customers make decisions, particularly in the B2B landscape, on relationship factors like trust, likability, innovation.

Most common measures are meaningless: lagging indicators vs. leading indicators

Most of the common marketing metrics are, well, useless. Awareness, mind share, perception, recognition, recall, share of market, loyalty, purchase intention, cost per click, etc. may be easy to measure, but they don’t connect to business value nor do they provide indicators of what to do differently to improve performance. They are lagging indicators measuring past performance rather than leading indicators that can help diagnose where to improve brand and relationship preferences and how to monitor progress of achieving marketing objectives.

Focus on just a few things

Many marketers try to measure too many things - 30 or 40 factors. It’s impossible to properly assess that many factors - or have the resources to work on improving that many factors. Many of the speakers recommended focusing on just 3 - 4 product preference factors and 1 -2 relationship preference factors.

Getting on the same page crucial to success

All of those firms with successful measurement strategies have educated their entire leadership team so that everyone has a shared definition of marketing, marketing value, measures and metrics.

The CFO’s mantra

Kamal Sen, director of business analytics and strategic planning for Unilever in Asia, Africa, Middle East and Turkey, offered what the CFO really cares about:

• Sales is vanity.
• Profits are sanity.
• Cash is reality.

During a recent call with Rob Kozinets, a marketing professor at York University in Toronto and a leading mind on online communities, we talked about the changes in marketing and Rob remarked that consumers use to be like mute slaves to businesses, listening passively while the one-way messages came at them.

As a follow up to our call, Rob reflected more about the mute slave metaphor — and its relationship to the character Nova from Planet of the Apes on his blog.

(The wild slave character Nova eventually gets her voice, much as people have today through social media, creating new relationships with businesses, new business models, and social change. Go Nova, go!)

PS — Rob’s book is Consumer Tribes.

I just finished a research project about marketing analytics with Dave Bond of Sapient that you can download here. Highlights of our findings:

Overall takeaway

Analytics isn’t about measuring and reporting. It’s about aligning marketing with corporate goals and generating meaning from the data to guide decisions.

Former Nissan CMO and Hyundai Motor America chief operating officer Steve Wilhite summed up the issue well when he explained to us:

“People are spending a tremendous amount of money to generate data, much of which is useless. At the end of the day the metrics you choose to measure should be part and parcel of strategy development. Being able to measure what you’re trying to accomplish is what becomes important in business planning and obviously it becomes important in justifying the particular execution that you choose.”

Six major obstacles

1. Lack of agreement and support from senior executives
2. Gap between corporate goals and tactical analytics
3. The tyranny of metrics, aka the ROI black hole
4. Misleading insights from measuring silos
5. Alignment requires change management heavy lifting and patience
6. Confusion about fundamental types of analytics and measures

Five guiding principles for creating a marketing analytics strategy

1. Get on the same page about the measures that matter the most
2. Adopt just a few measures
3. Use a portfolio approach
4. Build analytics into marketing strategy
5. Know the devil is in the data: collaborate with IT

Speaking at the BRITE 08? branding/innovation/technology conference last Friday Mike Hemingway, global managing director, Ogilvy & Mather Worldwide, offered these insights:

• Everything a brand communicates to its customers should be personal and important.
• The future of marketing is not just offering value to customers, but offering values.

• The Web is today’s mass media. Advertising and public relations are the accelerators to use to get people to the Web.
• A brand is like a country. Make it a place where people want to be and go to.

You can’t jump start a trend by trying to influence highly social people, aka “the influentials,” according to Duncan Watts, a Columbia University network theory scientist currently working for Yahoo Labs. Nor can anyone predict or engineer trends, he says. The complex network effects on society mean that trends occur randomly.

In an article in this month’s Fast Company (”is the Tipping Point Toast?”) Watts also says,” If society is ready to embrace a trend, almost anyone can start one — and if it isn’t then almost no one can.”

Talk about challenging word of mouth and influencer marketing assumptions with scientific data

If Watts’ research is right, what does it mean to marketers? A few thoughts…

1. How do we become better at quickly yet deeply understanding our markets and the head set of customers to see if our ideas and products fit within their context and their “readiness” to embrace a trend, a new way of doing business, a message? I’ve seen so many companies try to push a “transformational” product to a customer base that wasn’t interested or ready to be transformed. It reminds me something the late producer Louis Mayer once allegedly said, ” If people don’t want to come, there’s nothing we can do to stop them.” By the time traditional market research identifies a trend, the trend may be waning or over. Maybe online communities are the best way to spot changes. Or new unstructured data analysis of online conversations.

2. What are the best way to understand the life cycle of trends and tap into them to help our brands and businesses? How can we use new tools to spot trends early? At what point in the trend cycle does it make sense to invest money and ride the trend? At what point is the trend waning and we’d be better off not riding the final wave of a trend?

3. How do we redefine success? The goal of leading the next blockbuster trend, as Watts points out, is unrealistic; the world is too complex to even be able to predict how trends occur never mind think our company can consciously lead the wave. Having the biggest social network doesn’t mean your social network is meaningful and successful. Having a gazillion hits to your blog doesn’t mean the blog is achieving your goals.

And so aiming to be a big part of the next big thing may just be foolish,

Is Unilever a hypocrite or just doing good brand marketing as usual? Here’s the controversy: Dove’s successful “Campaign for Real Beauty” introduced a video called “Onslaught” this fall educating girls on a wider definition of beauty, warning of the onslaught of typical beauty industry messages about what makes a beautiful woman (plastic surgery, bulimia, etc.), and advising parents to “Talk to your daughter before the beauty industry does.”

At the same time AXE, another Unilever brand, introduced some videos that depict women in just the opposite way — sex-crazed, busty, near-naked Amazons.Then comes this Dove-AXE mash-up spoof video, with the line ” Talk to your daughter before Unilever does.”

Since then there has been a blizzard of media articles, like this Op-Ed in the Boston Globe, “A company’s ugly contradiction” by Michelle Gillett.

“But the launching of “Onslaught,” the most recent of Unilever’s efforts to foster self-esteem, has also launched a controversy about the sincerity of its commitment to “real beauty.” …Viewers are struggling to make sense of how Dove can promise to educate girls on a wider definition of beauty while other Unilever ads exhort boys to make “nice girls naughty” and assure them, “the more you spray, the more you get” in the Axe deodorant body spray ads.”

Business school marketing courses taught us to create brands that connect with the target audience’s values and appeal to them emotionally, which both Dove and Axe seem to be doing superbly well, especially when you look at the revenue and market share growth of these two brands over the past few years.

In this new world of transparency, do branding “best practices” need to be rewritten? Instead of “connecting” with artificially constructed brands, do people want to connect with companies whose values and causes they identify with? Do people want “relationships” with brands or with the companies and people behind the brands?

I think the Unilever controversy shows that people want to buy from companies they like and identify with, not brands. A new marketing mash-up is in the making — branding and corporate reputation. The new stars won’t be the ad agencies, but the company’s leadership team.

How do you turn around a small, private liberal arts college – reducing a chronic deficit and tripling the endowment in nine years? At last week’s AMA Symposium for the Marketing of Higher Ed Dickinson College president Will Durden shared some lessons behind Dickinson’s incredible academic and financial turnaround story.

1. All organizations need guts, passion and a vision so exciting that people want to be part of the story.

2. Successful marketing is built around a literary narrative:

• Identify a character so powerful that it invites others in. (Dickinson tapped into the school’s founder Dr. Benjamin Rush, a signer of the Declaration of Independence, founder of the first free public clinic for psychiatry, believer that American needed a new form of learning for America.)
• The narrative should have goals and a foil that the organization is fighting against
• The themes in the story need to connect people with big ideas; people want to be pride that they’re connected with stories much bigger than themselves.
• The story’s key themes have to be repeated over and over again; leaders must be passionate about the story and overcome boredom in telling the story. It takes quite a while before the story seeps into all an organization’s constituents
• Narratives need a vocabulary book. As part of its narrative, Dickinson developed a vocabulary book with words that the college uses over and over in telling its story. Words steeped in passion and a clear vision like outrageous, unapologetically committed to liberal arts, petulant brat.

3. The other ingredient for success? No doubt it’s having an academic entrepreneur like Durden leading the organization, instilling the type of aspirations, fierce pride and passion that get people from alumni to incoming students to believe and invest.

In 1998 Dickinson’s endowment was $151 million; today it’s $336 million. The story must be working. For more on this success story, check out this chapter of the book Shakespeare, Einstein and the Bottom Line: The Marketing of Higher Ed.

To get a sense of just how interesting Durden is, check out his YouTube “bow tie” video.

And for more about the Higher Ed marketing conference highlights, check out blog posts from Ken Steele and Michael Stoner.