Leadership Lessons from a Shirtless Dancing Guy: What Marketers Could Learn

1. Find a way for your brand to define its category, not just compete in an existing one.
2. The first to define a category risks ridicule.  Individuals will never use a computer.  Who would put wheels on a board and try to skate on it?
3. Be visible and remarkable; nobody cares if you’re simply different.
4. Seed the market; reward your first customers disproportionately.
5. Turn customers into evangelists for your brand.
6. Authenticity trumps creativity — every time (but it helps if it’s also creative!)

War is Over

“The true nature of marketing today is not serving the customer; it is outwitting, outflanking, outfighting your competitors. In short, marketing is war where the enemy is the competition and the customer is the ground to be won.”

—Al Ries and Jack Trout, Marketing Warfare, 1986

How the times have changed.  Unfortunately, the acknowledgment of those changes still lags behind the reality.  This is nowhere more apparent than in the language many marketers continue to use.  We still launch a campaign and conduct a media blitz.  The writings of Sun Tzu, von Clauswitz and even Mao have been quoted for decades as having vital lessons for marketing.  But the continued use of this metaphor propagates a false reality: that in the 21^st century, a docile audience can be “won” by some overwhelming show of marketing “might”.

The talk about your company was never a one-way affair.  Consumers talked to their friends, family, and neighbors.  It was common wisdom that word-of-mouth was persuasive and effective in a way that traditional advertising messages were not.  And this worked both ways.  In fact, if a customer had a bad experience, they were more likely to talk about than if they had a good one, a phenomenon that gave rise to the expression, “Nothing kills a bad product faster than good advertising.”  This is still true today.  But what has changed is that the consumer’s voice is now amplified by the power of the Web.

Thanks to the Web, the consumer is now in control to an unprecedented degree.  First, it was the availability of huge amounts of information.  Then it was the ability to search and filter for specific, relevant information.  Social media has now amplified this by enabling virtual communities — tribes — of folks with common interests to communicate in real time, globally, 24/7.  These communities thrive on authenticity, value and trust.  And the recommendations, referrals, and reviews (positive and negative) carry a weight that no advertising campaign could ever match.

Marketing is no longer just about your company and the competitors.  It’s about communities.  Communities that are cynical, savvy, and empowered.  Using the language of conflict and war is a legacy practice that persists through inertia, mental laziness, and force of habit.

If war provides any lessons for today’s marketer, it may be that the new metaphor should be counter-insurgency, not conquest.  Not a win-lose mind-set, but winning hearts and minds.  And you can’t do that while shelling large populations with irrelevant ads.  Think of the waste.  Think of the collateral damage.  …OK, so maybe some war metaphors are still useful.

Remember When a Pre-Owned Vehicle Was Just a Used Car?

During a recent interview segment on American Public Media’s Marketplace program, the guest, novelist John Lanchester, used the term “re-branding” to describe a contributing factor in our economic meltdown.  Here’s the quote, in context (emphasis mine):

Kai Ryssdal (host): That’s a great word, actually, frictionless-ness because that’s really sort of what happened to cause this whole thing. I mean, money was moving all over the place and nobody really knew it.

John Lanchester: Yeah, I think that is it. It’s strange how easy it is for that to seem natural. It’s almost a trick of re-branding. They didn’t so much call it money, they call it credit. Once upon a time credit used to be called debt, which is what it is. But if you rename money as credit, and give people the idea that access to credit is something that is almost a right, it’s something that should be easy, that should be freely available, that shouldn’t really have consequences, I think it becomes much easier to jam people with all the debts that they got stuck with.

This “trick” of simply calling something by another name, can be powerful.  Remember when a “pre-owned vehicle” was just a “used car”?  Wouldn’t you rather get behind “revenue enhancement” than a “tax increase”?   Or does “climate change” sound more benign than “global warming”?  Taken to the Orwellian extreme, this manipulation of language results in people believing “war is peace”, “freedom is slavery”, and “ignorance is bliss”.

As with any trick, it helps if it plays into what the audience wants to believe.  And it seems you can never go wrong by appealing to self-interest and/or baser instincts.  Therein lays the power of substituting the word “credit” for the word “debt”.  It changes the focus from the consequences to the reward: instant gratification.

But does this constitute “re-branding”, or is this simply “spin”?  And what’s the difference?  First, it may help to define what we mean by “brand”:

According to Seth Godin,

A brand is the set of expectations, memories, stories and relationships that, taken together, account for a consumer’s decision to choose one product or service over another. If the consumer (whether it’s a business, a buyer, a voter or a donor) doesn’t pay a premium, make a selection or spread the word, then no brand value exists for that consumer.

The genius of changing “debt” to “credit” goes deeper than just the words.  Indeed, our whole perception has been altered.  What was once a mark of weakness and shame (you can’t afford to pay for that?) or even a crime (debtors prisons operated in America until 1850) was transformed into a mark of status (do you carry a green American Express?  Gold? Black?)   The amount you could owe became a source of pride and power.  Who knew that people would actually spend money that they didn’t have, and probably would never be able to earn?  Or that our bankers and financial institutions would do the same? Yeah, right.

Looked at in this light, it is easy to see why the growth of our credit culture qualifies as a true re-branding.  Additionally though, it is a reminder that we need to be more discerning about the way we process and the way we use words.  As brand signifiers, carefully chosen words can be the front line of the re-branding cascade.  This kind of re-branding may become more difficult in the Internet age, where peer-to-peer communication, social networks and instantaneous access to information had led to increased value for authenticity.  But then again, maybe not.  Just look at some of the examples in Frank Luntz’s book, Words That Work.  If you notice “energy exploration” replacing “drilling for oil” in public discourse, you can blame Frank.  “Spin” — a simple choice of words or turn of phrase — can be the seed of re-branding.

Brand Fragility in the Age of Twitter

UPDATE 2/1/10: Amazon has capitulated to Macmillan’s terms.  See: http://www.nytimes.com/2010/02/01/technology/companies/01amazonweb.html

Amazon’s Statement:  “We have expressed our strong disagreement and the seriousness of our disagreement by temporarily ceasing the sale of all Macmillan titles,” Amazon said. “We want you to know that ultimately, however, we will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books.”

Amazon continues to position itself as being on the side of consumers in this dispute.  But in the age of Twitter, this kind of half-truth gets torn to shreds by consumers and bloggers at lightspeed.  It’s all about Kindles and a bigger piece of the pie for Amazon, and any halfway interested consumer could sniff this out with one quick search.

Original post (1/31/10):

As I write this, a firestorm of controversy is lighting up the net.  A dispute between Macmillan publishing and Amazon over pricing for Kindle e-books has resulted in Amazon pulling all Macmillan-published titles, both electronic and physical copies, from its store.  As reported on BoingBoing.net (emphasis mine):

“The New York Times quotes an industry insider as saying that Amazon pulled these books in retaliation for a demand from Macmillan to raise the price of Kindle books from $10 to $15. Presumably, Amazon perceives the $10 price-tag as a way of encouraging people to buy its Kindle platform, which itself is a kind of roach-motel for books: the license terms and DRM on the books in the Kindle store prohibit you from reading your Kindle books on competing devices. So books check in, but they don’t check out. (I believe that Amazon’s terms, patents and trade-secrets also prohibit its rivals from making software that converts or renders Kindle books for that purpose. I have asked Amazon whether this was true on more than ten occasions over the past several years, in my capacity as a writer, publisher, and columnist for the Guardian and Publishers Weekly, but they refuse to answer.) If the NYT’s report is true, then this is a case of two corporate giants illustrating neatly exactly why market concentration is bad for the arts: * If true, Macmillan demanding a $15 pricetag for its ebooks is just plain farcical. Although there are sunk costs in book production, including the considerable cost of talented editors, copy-editors, typesetters, PR people, marketers, and designers, the incremental cost of selling an ebook is zero. And audiences have noticed this. $15 is comparable to the discounted price for a new hardcover in a chain bookstore, and it costs more than zero to sell that book. Demanding parity pricing suggests that paper, logistics, warehousing, printing, returns and inventory control cost nothing. This is untrue on its face, and readers are aware of this fact.

Update: not to say that all ebooks should cost the same. But they should be cheaper than print editions. * If true, Amazon draping itself in the consumer-rights flag in demanding a fair price is even more farcical. Though Amazon’s physical-goods sales business is the best in the world when it comes to giving buyers a fair shake, this is materially untrue when it comes to electronic book sales, a sector that it dominates. As mentioned above, Amazon’s DRM and license terms on its Kindle (as well as on its Audible audiobooks division, which controls the major share of the world’s audiobook sales) are markedly unfair to readers. Amazon’s ebooks are locked (by contract and by DRM) to the Kindle (this is even true of the “DRM-free” Kindle books, which still have license terms that prohibit moving the books). This is not due to rightsholder-demands, either: as I discovered when I approached Amazon about selling my books without DRM and without a bad license agreement for Kindle and Audible, they will not allow copyright owners to modify their terms, nor to include text in the body of the work releasing readers from those terms.”

You can see similar statements of outrage being expressed by other prominent writer/bloggers all over the net.  Examples can be found here, and here.

From the first link above, John Scalzi says:
” If nothing else, this bit of asshattery on the part of Amazon has well and truly cured me of any desire to ever get a Kindle. If Amazon is willing to play chicken with my economic well-being — and the economic well-being of many of my friends — to lock up its little corner of the ebook field, well, that’s its call to make. But, you know what, I remember people who are happy to trample my ass into the dirt as they’re rushing to grab at cash. The money I don’t spend on a Kindle will mean more to me than it does to Amazon, but I’m fine with that. The money I don’t spend on electronic books bought from Amazon over the next couple of decades will also probably mean more to me than Amazon, but I’m okay with that too. I’m not really trying to make a huge statement about it, and I’m not suggesting anyone else join me. Enjoy your Kindle if you have one. Buy my books for it if they ever come back to it. All I’m saying is: I remember how I’m treated and for what reasons. And you know, I do buy a lot of books.”

You can bet their tribes are listening, and spreading the word.

In fact, a quick search of Twitter for Amazon, Macmillan, or Amazon/Macmillan gets you a host of similar sentiments and a lot of links to these blogs and many, many more like them.  The tribes are restless.

What does this all mean?  Well, first, that these kinds of disputes and business moves can no longer be made to disappear simply by trying to bury the move late on a Friday afternoon.  The online world is never sleeping, and news spreads at an exponential rate.  Second, that a certain segment of the devoted Amazon tribe will feel betrayed.  Amazon, in their eyes, will have violated a part of its agreement with consumers and fans in a cynical attempt to make money rather than to serve its customers and its mission.  Macmillan doesn’t have much of a brand identity, and will probably not suffer much.  So Amazon will “win”, but at what cost?  How many will abandon the service for good, decide not to buy Kindles, and encourage others to do the same?  A betrayed follower could be even more fervent in his vocal dislike of the brand than he was in his evangelism when he was a happy member of the tribe.

In the end, Macmillan books will probably end up back on the Amazon store sooner rather than later.  But Amazon’s brand has taken another beating in a series of recent mini-scandals, this one coming on the heels of last summer’s controversy over its de-listing of sales figures for gay and lesbian books, which resulted in the coinage of the term “AmazonFail.”  How many more AmazonFails can the brand sustain?  The tribe is watching.  And growing restless.