Making the Case: Netflix

The weekend is finally here. After weeks of hearing co-workers talk about the latest blockbuster hit, you can finally head to your favorite movie rental store and grab the movie you just missed in theatres. You get excited as you enter the store and run to the new releases assured you will get one of the guaranteed copies. As your eyes finally focus on the movie you were looking for, you find yourself in a race with the customer next to you for the last copy.

This scenario used to happen way too often. You were forced to rent something you didn’t want, leading to a potentially unenjoyable movie night. Thanks to DVD-by-mail provider Netflix, those days are over.

Now, you peer into your mailbox with delight and glee on the sight of that distinction red envelope: your new Netflix movie has arrived!

With their number one goal of delivering movies to their customer’s home within 1 business day and no late fee’s, Netflix has become the primary choice for 8.4 million movie lovers across the United States. How has Netflix beaten its competition, including the former giant Blockbuster Videos and even behemoth Wal-Mart? They focused on making their service easy to use and always serving their customers better than anyone else. Netflix’s promise to always have a movie waiting at home has made them a dependable source that customers can trust.

Netflix provides customers with continuous gratification. Starting at just $4.99 a month, the service allows anyone who has an address and likes watching films to sign up. Netflix caters to the entire spectrum of moviegoers, offering nine different subscription plans to choose from. Casual movie watchers can sign up for the two-movies-per-month plan, while fanatical film buffs can choose unlimited rentals with eight movies out at one time. Plus, users can change their plan at any time with a single click.

Netflix makes it easy to navigate and search through 100,000’s of movie titles online. The personalized “Queue” allows users to quickly and easily manage their upcoming film selections. Their sophisticated rating and searching tool helps users search movies by genre, director, blockbuster hits, and of course, academy award winners. Like a specialized movie store, Netflix strives to make it easy for their customers not only to find what they are looking for, but also allows them to explore and experience new movies. With over thousands of obscure and popular movies available at Netflix, there’s always a new film to enjoy. Plus, since subscribers pay a monthly fee for unlimited films, you never have to feel guilty for renting a movie and not liking it.

Understanding that sometimes five days is not enough to watch a movie, Netflix never penalizes their customers with late fees. Unlike Blockbluster Video and other traditional movie rentals, Netflix customers can keep movies for months without any worries thanks to their monthly subscription model. When the customer is ready to return the movie they simply drop it in the mailbox; the postage is already included. Within two days a new movie from their queue arrives, keeping the customer constantly gratified. With more than 100 fulfillment centers across the United States, Netflix has made a commitment to get movies to their customers quickly.

With trips to brick and mortar rental houses frequently ending with bad movie night, a more frustrating scenario is leaving empty-handed. By allowing users to rate any movie on a 5-point scale, Netflix has created a unique customer database that is constantly being improved. By comparing users profiles, Netflix searches for similar trends and provides personalized recommendations of movies their other customers might enjoy.

If 100,000 titles to choose from aren’t enough, customers currently have over 12,000 movies titles they can instantly play from any computer. Netflix also allows customers to have access to streaming movies on their TV through the Netflix ready device and soon on the Xbox360 (coming in fall 08).

Through web ads and TV commercials Netflix constantly communicates how easy and reliable their services are to use. By keeping their promise they have become a commodity for movie lovers, some even claim to have Netflix marathons and watch 27 movies in one month. Netflix fans have formed an online social network for movie lovers where members can discuss the Netflix website, movies, and can create personalized pages. Netflix raving fans have even made their own Netflix commercial.

Netflix continues to succeed because they have one thing in mind, keeping their customers happy. By providing an easy way to navigate through movies, fast delivery, and zero late fee’s, it is no wonder so many people are falling in love with Netflix.

Calling All Business Leaders: Sell In, Not Out

Know Thyself

The first cardinal rule of becoming a therapist is Know Thyself.

Therapists-in-training will spend countless hours in the classroom learning fundamental theories of the mind and will spend years under supervised practice learning how to master the art of therapy.

Yet entering in one’s own personal therapy is not even highly encouraged in most graduate school programs.

When sitting with a client for the first time, novice therapists quickly learn the experiential realities of being ”stuck,” and how easy it is for one’s personal issues to muddy the therapeutic waters.

When therapists ask their clients to do the difficult task of going inward and facing the shadows that lurk in their psyches, the question first asked is whether they are willing to embark on this journey themselves?

The question can be applied to many different scenarios:

  • Would you become a violin teacher if you first didn’t master the art of violin playing?
  • Can you tell others what it’s like to climb Mount Everest when you’ve never done so yourself?
  • Can you teach others to practice compassion if you have difficulty practicing it yourself?

You simply can’t. You need to go through the hard work of mastering (or working towards mastery of) a craft before you teach it to the world. You need to wholeheartedly believe in your approach before you attempt to sell it to the masses.

In business, companies pride themselves on selling products that embody higher values like freedom and happiness, yet they turn a blind eye to the values they’re promoting, or rather not promoting, within their own organizations.

Sell In, Not Out

Through selling in, businesses embrace a global vision the entire company can be passionate about. Values pervade every aspect of the business, not only those that reach the consumer, but those that are felt at the deepest levels of the organization.

If brands cannot rally their own troops, how could they be able to rally their customers in support of their products?

When companies pride themselves on taking care of their customers at all costs, but treat their employees worse than their estranged brother-in-law, the misalignment quickly erodes confidence within the organization.

What differentiates Cult Brands and allows them to stand apart from the masses is their holistic approach to business.

Heather McIlhany, online marketing manager for DVD-by-mail shop Netflix, explained, “There’s an inverse relationship between how often a company talks about its values and how much those values are actually reflected in the workplace.”

Netflix understands that a great company earns the respect of its customers and its employees by promising certain values—like commitment, loyalty, and freedom—that they work hard to uphold. An operation without this synergistic balance loses its footing and ultimately, its sense of trust.

Like Netflix, Wal-Mart is another business that wholeheartedly practices what it preaches. The late CEO Sam Walton, built his empire on the “Always Low Prices” philosophy, a vision not only intended for the consumer.

Even when Wal-Mart made Walton a very wealthy man, he insisted on driving his beat-up old pickup truck instead of upgrading to a luxury vehicle, and sharing budget hotel rooms while on business instead of checking into a private suite at the Four Seasons.

His no-frills, frugal lifestyle continues to influence Wal-Mart’s culture. Years after Walton’s death, you’ll still spot top executives flying coach and checking into economy hotels together.

Herbert Kelleher, beloved founder and former chairman of Southwest Airlines, is perhaps the ultimate champion of selling in.

Unlike the bureaucratic mindsets of some CEOs, Kelleher purposely chose to inhabit a windowless interior office at Southwest’s corporate headquarters. He explains, “I’m trying to set a good example that it doesn’t matter where your office is, it’s where your mind is that should be important.”

In Kelleher’s view, physical space is meaningless. “It’s the space between your ears that should be the important thing.”

It’s the Southwest attitude that trickles down from the company’s leaders, in a cascading effect that inspires the employees, and ultimately the customers.

Kelleher remarked, “You have to treat your employees like customers. When you treat them right, then they will treat your outside customers right. That has been a powerful competitive weapon for us.”

In fact, the perfect pitch for ‘Selling In’ can be found in Southwest’s Mission Statement for their employees: “Above all, employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest customer.”

How consistent are the values in your organization? Do you talk a good talk about promoting higher values with your consumers, but won’t walk the walk with your employees? Take an honest look within and ask yourself: Am I selling in, or out?

What Has To Die?

Almost every company is doing something they shouldn’t be. Nothing akin to the deceptive practices of Enron, but something that in someway hurts or dilutes the value of the brand.

When Steve Jobs returned to Apple he encountered more products than Shiva could juggle. In Inside Steve’s Brain, Leander Kahney reports that during a 1998 World Wide Developers Conference, Jobs commented, “I started to ask people, now why would I recommend a 3400 over a 4400? When should somebody jump up to a 6500, but not a 7300? And after three weeks, I couldn’t figure this out. If I couldn’t figure this out…how could our customers figure this out?”

Frustrated, Jobs simplified their line into four products on a grid: consumer/professional and portable/desktop. It was so simple anyone could understand it. Not only did it lower the barrier to entry into the Apple family, it reinforced Jobs’ vision of simplicity, which is at the heart of the Apple brand.

Your impediment may be some product that doesn’t fit your brand, some advertisement that doesn’t speak to the heart of your customers, or customer service that doesn’t reflect your brand’s values. It’s anything that mars your brand’s ultimate vision and hinders you from clearly telling your story to the world. Simply, it dilutes your brand’s power.

As the theatre director and Pulitzer-prize-winning writer David Mamet would say: if a chair onstage doesn’t contribute to the story, (pause) get rid of the fucking chair.

Figuring out which chair doesn’t belong on your stage begins with defining your brand’s ultimate vision. And, your ultimate vision must take into account what your best customers—your Brand Lovers—love about your brand.

Once you’ve defined your ultimate vision, ask yourself, “What has to die for us to get there?”

Humor in the Workplace

Ah, laughter, the timeless elixir for the soul.

Passengers, taking a Southwest Airlines flight for the first time, are graciously taken aback by the flight crew’s lighthearted sense of humor. Compared to other commercial airlines whose stewards and stewardesses are dressed to the nines, with perfectly coiffed hair and plastic attitudes to match, Southwest stripped their crew of these pretensions and brought them back down to earth.

The flight crew traded in their business skirts, high heels, and pantyhose for khaki pants, polo shirts, and sneakers. At Southwest, comfort prevails over fashion. Along with this radical wardrobe change came a laid-back attitude, a great sense of humor, and a genuine smile that radiates, “Hey, I really love my job!” The fun-loving spirit that wafts through Southwests’ cabins is truly infectious. Bleary-eyed passengers who have come to equate air travel with their worst living nightmare have to fight hard not to smile when disembarking from a Southwest flight.

Immediately after take off, the pilot’s voice is heard through the overhead speaker: “Bear with me folks, this is my first time.” Chuckles are heard throughout the cabin. In reviewing the safety procedures, a flight attendant instructs, “In the event of a sudden loss of cabin pressure, oxygen masks will descend from the ceiling. Stop screaming, grab the mask, and pull it over your face. If you have a small child traveling with you, secure your mask before assisting with theirs. If you are traveling with two small children, decide now which one you love more.”

The laughter continues. When the plane has landed, a flight attendant warns, “Please use caution when opening the overhead compartments, as shift happens.”

A Healthy, Happy Workplace

It’s well known that a healthy workplace boosts morale, lowers turnover, decreases abseentism, and increases productivity. When workplaces are plagued by negative energy, backstabbing antics, and gossipmongers, people turn into the lost school children of Lord of the Flies, forced to fend for themselves in a cruel, competitive, and unforgiving world.

Southwest knows that humor is not incompatible with competition, however. After all, the airline has remained consistently profitable even in a post 9/11 era. Yet they intuitively understand the power of humor and its ability to ease stressful situations, build rapport and cohesiveness, and soften the most hardened lines of communication.

Who did they inherit the funny genes from? Who else, but the zany, jolly good fellow by the name of Herb Kelleher? As founder and former chairman of Southwest, Kelleher’s off-the-wall antics successfully established the mood for the company’s quirky culture. In one famously outrageous incident, in 1992, Kelleher and Kurt Herwald, chairman of Stevens Aviation went head-to head in an arm-wrestling competition over the rights to a slogan. Stevens Aviation was using their “Plane Smart” catchphrase for a year before Southwest inadvertently infringed on their rights with its “Just Plane Smart” campaign. The dual, scheduled for high noon, would proclaim one winner. Kelleher lost the match, but in a spirit of good will, Herwald granted Southwest permission for continued use of the tagline.

Kelleher gets the true power of humor. He knows it can disarm his competitors, dissolve hurt feelings, and mollify potentially litigious situation. He also knows that humor can ease customer frustrations and create positive associations that last.

To turn the farcical factor up a notch, for Halloween, you’ll even see Kelleher dressed as Dr. McDreamy of Gray’s Anatomy fame, and chief executive Gary Kelly dressed up as Edna Turnblad, the hefty housewife from the musical “Hairspray.”

Robert Half International, an executive recruitment firm, surveyed 492 professionals and found that 97% felt it is important for managers to have a sense of humor. Max Messmer, chief executive of Robert Half explained, “Managers who can laugh at themselves or difficult situations are often seen as more approachable and in touch with the challenges their teams face.”

It’s no doubt that Kelleher and Kelly are in touch with their people, and it’s this particular attitude that Southwest looks for in potential hires.

Ginger Hardage, Southwest’s Senior Vice President of Corporate Communications, explained, “What we try to show in our public relations and our advertising is the Southwest attitude. When we hire people, we look for that particular attitude.” A candidate on a job interview might be asked a question about the last time he or she used humor to pacify a tense situation. Hardage also recalls a time when a group of pilots showed up wearing traditional suits, but were told that only candidates wearing gym shorts would be interviewed that day. Sounds like a joke? To Southwest, humor is serious business. The pilots who changed into gym shorts got hired; the others went home. Hardage stated, “If people tend to be serious, stuffy and can’t laugh at themselves, then they probably won’t work out at Southwest.”

Punch Line the Bottom Line

Chris Robert, assistant professor of management at the University of Missouri-Columbia’s Robert J. Trulaske Sr. College of Business, studied the effects of humor in the workplace. With humor and positive emotions going hand-in-hand, there was also a strong correlation between positive emotions and workplace performance. Robert explains, “That’s where employee retention comes into it. If you have positive emotions about your job, you’re less likely to quit. And maybe part of that is because of the fun you’re having in the break room. You might get a better job offer, but it will take more to draw you away when you like where you work and you like the people you work with.”

Yet humor does more than create a happy workplace that increases productivity. Robert found that the use of humor is associated with two highly prized values: intelligence and creativity. He explains that humor traces its impact to incongruity. A joke is funny because two seemingly disparate things are connected in a way that makes them compatible. It parallels the process of creativity where ideas converge in a unique manner. With creativity flowing through the pipelines, innovation flourishes and businesses take on new heights.

When humor infuses the workplace, it becomes a breeding ground for happiness, productivity, creativity, and innovation. When employees are feeling positive, the customers catch onto the spirit and get the best ride of their lives.

In the words of Kelleher, the chief jester himself, “Humor rubs off on people. We don’t hire people to be funny, but we want them to keep their individuality, which makes them feel better about work and, in turn, makes them happier and more productive.”

So loosen up and let the laughter begin.

Apple, Making Friends From Foes

When the iPhone first released on June 29, 2007 there were lines of people in Mac stores across America waiting to be the first to pay $599—to touch its magical screen and make a phone call to a friend and scream “I got an iPhone!”

And there was another kind of person in those lines. This person could not wait to grab an iPhone, run home, and void their warranty immediately. Hundreds of developers, hackers, and power users were first in line to get their hands on an iPhone and start unlocking its full potential.

Since the first release of the iPhone people have been “jail breaking” and “unlocking” their iPhones by the hundreds of thousands. An iPhone that is “Jailbroken” can allow third party programs to be installed, such as games, karaokie machines, tip calculators, programming tools, and even a pretty stunning simulation of a guitar that could be played on the iPhone.

Other unique features of “unlocking” the iPhone include the ability to change settings in the phone, such as background images, sounds, and even the available service carrier.

In 2007, at a bustling London Apple retail store where Steve Jobs unveiled the iPhone’s Nov. 9 U.K. debut, the atmosphere buzzed with anticipation. During the Q&A, a journalist probed whether Apple would curb the unlocking hacks that had recently surged. Jobs, with a wry smile, described it as “a cat-and-mouse game,” a dynamic he’d recently discussed with a colleague over coffee, referencing the relentless ingenuity seen in high payout online casino platforms. These sites, thriving on clever algorithms to maximize user rewards, mirrored the hackers’ tenacity in exploiting systems, inspiring Jobs to emphasize Apple’s resolve. “We try to stay ahead,” he said. “People will try to break in, and it’s our job to stop them breaking in.”

When Apple first learned of the hack they released an update that would render “unlocked” iPhones useless, turning them into very expensive paperweights.

The hacking community did not stay still; within a day they had already found a way around the new update and hacked iPhones were working again. With every update that Apple has released, the community has found a way to continue to get the perks from Apple’s update while having their phones unlocked.

So what is Apple to do in a situation like this? Here is G4tv showing us one solution.

What Apple has done to help solve this problem is genius. The company decided to apply the Cult Branding golden rule of freedom and embraced their enemy.

Apple announced that they were releasing their SDK (Software Development Kit) to the public for free. But they went a step further too: Developers will receive 70% of the sale from their applications for the iPhone sold through the iTunes stores. Seventy percent represented an unprecedented earnings share and demonstrated a clear alliance with the hacker and development community. By being so generous with the developers Apple is extending their hand to all, they are helping to ensure the iPhone spot as the best handheld computer in the world.

With the release of the 3G iPhone, Apple is allowing the phone to be used in over 70 different countries, and eventually in the U.S with a different carrier other than AT&T. With over 1 million 3G iPhones sold on opening weekend and 70% of all sales, developers are starting to forget their hacking days and welcoming Apple as a new ally.

Of course there will always be the hardcore users who will never conform, but Apple’s strategy has helped them gain the trust and assistance of genius developers around the world. With this new addition to the iPhone developing team, the possibilities for the iPhone and its community are endless.

Apple has turned an enemy into a friend with a generous offer that seems too good to be true by industry standards. Apple is embracing the community that loves their product and all it has to offer. Instead of engaging in an endless battle with developers, Apple has opened the door to them.

There may be times when you might feel consumers are sabotaging your brand. You cringe at the thought of someone tainting your beautiful creation. Fear not. Make a friend out of a foe. Transform a saboteur into a brand evangelist.

Keep an open mind. Be ready to embrace change. Allow your best customers to co-create the future of your brand with you.

iPhone Deja vu

Ads proclaim, “The iPhone killer is here!” People are lining up,, eagerly waiting to be the first with the coolest new phone in the world. It sounds like déjà vu. This time, however, it’s not just happening in the US; it’s happening all around the world—and at the same time.

What product launch can be so big to get people in 21 countries to camp outside of their favorite store? Apples re-launch of the iPhone, of course.

With Apple’s launch of the 3G iPhone, the company is making their powerful brand even more accessible to the entire world. Apple’s worldwide success is not a coincidence; their brand stays true to itself across all of its touch points. With the iPhone’s 3G capabilities, multiple language keyboards, an exchange program that promises to be easy for all to use, and a beautiful design, it is no surprise that Apple is getting the same reaction as they always do.

New Zealand

The phone first went on sale in New Zealand where hundreds of people lined up outside stores in the country’s main cities to snap it up right at midnight (8 a.m. Thursday on the East coast ).

Japan

iPhone fever was strong, More than 1,000 people lined up at the Softbank Corp. store in Tokyo. The phone quickly sold out. Although Japan has phones that provide significantly greater functionality than the iPhone, people still gravitated to the iPhone’s magical allure.

“Just look at this obviously innovative design,” Yuki Kurita, age 23, said as he emerged from buying his iPhone, carrying bags of clothing and a skateboard he had used as a chair during his wait outside the Tokyo store. ”I am so thrilled just thinking about how I get to touch this.”

US: New York

Enthusiasm was running high in anticipation for the 8 a.m. launch of the new phone with a line numbering in the hundreds encircled the block at Apple’s Fifth Avenue store.

Apple learned a lot from their experience with the iPod and its dominance in the mp3 market. They are taking the same approach with the iPhone and making it the only real choice in the phone market. “The iPhone is just a superior user experience,” said Alex Cavallo, age 24, lined up at the Fifth Avenue store.

Apple has become a master at building anticipation and delivering killer products. This new release of the iPhone not only catered to those who didn’t have an iPhone but also for those who already have one. With the release of third party applications even the 1st Generation iPhone users have new toys to play with.

It’s not Déjà vu, and it certainly is not a coincidence. Apple announced after the first weekend that 1 million iPhone 3G devices have been sold, with earnings being reported at around $350 million in the first weekend. Apple continues to dominate their markets because they continue to provide their customers with unique products and experiences that can’t be found anywhere else in the world.

Making the Case: Is eBay worthy of Cult Brand status?

I first started using eBay when I was in graduate school. Being a hopelessly price-conscious student, I was always looking for the best deal. Alas, I found my way to eBay. After winning my first auction, I was hooked.

The thrill of winning an auction is like hitting the jackpot. You place your bid, hawkishly watch the official eBay clock, and monitor the other bidders every move. Even after getting embroiled in a bidding war and losing by a mere 50 cents, you walk away from your computer and silently remark, “Good game.”

What I love most about my eBay experience is the absolute accountability buyers and sellers have for their actions. With their simple rating system, you leave positive, neutral, or negative feedback, depending on the transaction. If a seller promotes false advertising or doesn’t follow through with their promises, they are rated accordingly. This gives buyers the power to decide whether or not to patronize a seller. Customer service is built in, and it upholds the gold standard to consumerism.

But does my love for eBay substantiate its spot as a Cult Brand? Or is it merely a powerful, iconic brand? Let’s see …

The Golden Rule of Courage: In 1995, Omidyar launched eBay in an experiment to see how “equal access to information and opportunities would affect the efficiency of a marketplace.” He envisioned an online market that allowed real people to compete head-to-head with big corporations. Omidyar, disturbed about the potential takeover of big businesses, stated “I wanted to give the power of the market back to individuals.” Through his revolutionary vision, Omidyar successfully tackled the corporations and did exactly what he intended to do—he leveled the playing field and helped ordinary folks like you and me control the marketplace.

The Golden Rule of Fun: The proverb, “One man’s trash is another man’s treasure,” resonates throughout eBay’s ecosystem. The thrill of buying and selling isn’t just about exchanging goods; it’s about the excitement of discovery and opportunity. This same principle applies to the growing popularity of platforms like an instant payout casino UK, where users are drawn not only by the convenience of fast withdrawals but also by the sense of control and immediacy these sites offer. It’s the satisfaction of a seamless experience and the joy of a quick win that transforms a routine activity into an engaging adventure. Like eBay, these spaces create a blend of functionality and excitement, redefining the way people interact with their goals and pleasures.

The Golden Rule of Openness: Prior to eBay, auction houses conjured up associations to elite organizations such as Christie’s and Sotheby’s, showcasing items that were only accessible to the top echelons of wealth. eBay brought the auction house to the people’s doorstep and gave them a community that was different, approachable, and inclusive. If you’re looking to sell your Goonies lunchbox, your Prada handbag, your vintage Bulova watch, your Star Wars collectibles, or even your house, post it on eBay. There’s an eager buyer out there somewhere. Whether you’re an individual buyer or seller, a small business, or an enterprise—whether you want to shop for the fun of it or harness eBay as your primary source of income—the eBay community welcomes you with open arms.

The Golden Rule of Freedom: eBay, by overturning traditional commerce, gave power back to the consumers who determined what price they were willing to pay. Not only did eBay promote personal freedom for its community of buyers, it did the same for its community of sellers. Can you think of another company that has influenced hundreds of thousands of people to create their own businesses? eBay inspires this process by offering free online courses through the eBay University Learning Center where members learn about the art of buying and selling. The entrepreneurial spirit reigns supreme at eBay, where the phrase “becoming your own boss” is not just paid lip service, but a sweet reality.

The Golden Rules of Contribution: Since the beginning, eBay members have embraced a powerful spirit of camaraderie. The eBay Community hub is the online forum where members join “neighborhoods” to connect, find experienced mentors, share their best practices, or just socialize. Whether you’re a dog lover, a coffee connoisseur, a jewelry collector, or a motorcycle maven, eBay connects you to like-minded folks who share similar passions.

Most importantly, philanthropy has always been an instrumental part of eBay since its inception. In 1998, eBay Foundation was established to support the economic and social enterprises of local communities. Staying true to their mission, the Foundation has provided $2 million in grants each year to sustain charitable giving and volunteer efforts around the world.

The Golden Rule of Human Needs: Listening to the Choir: Former CEO Margaret Whitman stated, “The best ideas and the best feedback come from our community of users.” Ten times a year, eBay invites buyers and sellers to the corporate headquarters in San Jose to take part in their “Voices” program. It’s the ultimate forum where members voice their likes and dislikes about their eBay experiences, and are actually heard, sometimes with the CEO’s own ears. These marathon focus groups often last two days and nights, and contact with Voices members continues even after the program’s end.

A recent effect was the revised rating system, which established that buyers can no longer receive negative or neutral feedback from sellers. This allows buyers to have more freedom in providing honest and accurate feedback without fear of retribution. This unilateral feature has undoubtedly made some sellers nervous, given the occasional scam artist and remorseful buyer. However, the new rating system appears to be raising the bar for customer service and pressing sellers to provide the best possible online shopping experience.

A final thought to ponder: There are more than 150 million people around the world who trust virtual strangers with every eBay transaction. Trust is the driving force, the essential ingredient that makes eBay work so effectively. Without it, the entire system would collapse. Abraham Lincoln once said, “The people when rightly and fully trusted will return the trust.” Thirteen years after Omidyar’s modest experiment, eBay has proved time and time again that the reciprocity of trust is at the heart of its virtual community.

Happy Bidding, and remember, you found it on eBay!

Where to go from here

Godin, Are You Serious?

Leander Kahney’s latest book Inside Steve’s Brain, a look at what makes Steve Jobs tick, made me stop, jump out of my seat, and shout, “Are you serious?” It wasn’t caused by a sudden revelation or a scandal; it came from a passage clipped from an interview with Seth Godin:

Not everyone loves Apple’s advertising. Seth Godin, author of several best-sellers about marketing, said Apple’s advertising has often been mediocre. “I’m underwhelmed by most of Apple’s advertising,” he told me by phone from his office in New York. “It’s not been effective. Apple’s advertising is more about pandering to the insiders than acquiring new users. If you have a Mac, you love Apple’s advertising because it says ‘I’m smarter than you.’ If you don’t have a Mac it says ‘you’re stupid.’”

Apple’s advertising is not effective. Really? Are you serious?

On an anecdotal level, I’m sure most of you know someone who has switched to an Apple computer in the past few years. But, how many of you know someone who has switched back? I don’t. Recently I watched a friend, who doesn’t own a cell phone, drop to floor in the middle of an iPhone commercial and start to proclaim how much he needs one.

Anecdotes are one thing and market numbers are another. But in this case, they both show the same thing. The first fiscal quarter of 2008 showed a 35% year-over-year growth in revenue, up $2.5 billion from the previous December, posting the most successful quarter in Apple’s history. The second fiscal quarter results surpassed Apple’s first quarter predictions with a 32.9% year-over-year growth, marking the strongest March quarter in Apple’s history. And, remember, this growth is occurring during an economic downturn.

Surely this growth isn’t coming at the hands of lifelong, hardcore Apple loyalists. Twenty-five percent of our office last year used Apple Computers; this year it’s 100%. We’re not the only ones: Investment bank Morgan Stanley reported that 40% of college students plan to make their next purchase an Apple computer, a full 25% increase in that market share over current statistics, which is likely to have an effect on the work force after these students graduate. And, even Godin has recognized how ubiquitous Apple computers have become.

If it’s not the advertising, then, surely it must be the technology. But, if the history of inventions is any indication, the best technology doesn’t always win. And, it seems Godin would agree. In a 2006 talk for Google, Godin told Google: “What I want to sell you really hard on is not that technology wins, ‘cause I don’t think it does, I think what technology does is that it gives you a shot at marketing. And, if you don’t buy into that then I believe that the company sooner rather than later is going to smash into a wall.”

So Godin’s essentially saying that Apple’s advertising isn’t effective, but technology only succeeds if the marketing works. And, Apple’s obviously succeeding. I’m not sure I follow the logic.

Rather than being ineffective, I’d consider Apple’s advertising brilliant. Most new converts got hooked into the Apple brand through the iPod and the silhouette-dancing ads. These ads are some of the most inviting ads in the last decade: anyone can picture themselves as the faceless figures rocking out to their own tunes. The message is obvious: if you love music, come in.

Once you’ve already bought into the brand, why wouldn’t you want to stand out as a person making the best choice? This is what the advertising for these computers reflects: Apple is the better choice. And, sooner or later, if you don’t already have an Apple computer and you’ve already bought into the Apple brand, you’re going to want one to go along with that iPod or iPhone. Apple stores are even set up with this in mind: try the iPod or iPhone and while you’re at it why don’t you play with that pretty computer sitting next to it.

Apple’s advertising, as I see it, is really a two-pronged approach: (1) invite you in with the iPod advertising and (2) keep you there with the computer advertising. One makes you want to come in, and the other makes you want to stay there, all while keeping true to the brand’s identity.

Ineffective? Anything but.

Talk is Cheap. Gossip is Priceless

Beware of Word-of-Mouth Marketing

ORLANDO, Fla. – From water-cooler conversations about American Idol to once-popular-but-quickly-forgotten products like Beanie Babies, what makes consumers talk about some brands and not others? One study by the Keller Fay Group, a word-of-mouth market research company, revealed that over 32 million consumers are considered WOM leaders and generate 1.5 times more conversation about products than a normal consumer. As the emphasis on word-of-mouth marketing increases are there secrets to harnessing the power of word-of-mouth marketing?

Marketing expert and partner at Nonbox Consulting, BJ Bueno believes the answer resides in the kind of experiences a product or service creates for a customer. His latest release, Why We Talk: The Truth Behind Word-of-Mouth (Creative Crayon Publishers, February 2007, ISBN: 0971481539, $24.95), provides seven principles to creating amazing customer experiences–the kind of experiences that prompt customers to talk. Most marketers have focused on WHAT people talk about but have ignored WHY people talk. Based on extensive research into psychology, marketing, and consumer behavior, Why We Talk explores what motivates consumers to spread the word about a company and its products.

“Perhaps the most important skill in business is not strategic planning, or marketing savvy, or risk management, or investment analysis. Rather it is simply the ability to LISTEN,” says Darryl Cobbin, Chief Marketing Officer and Vice President at Boost Mobile. “Why We Talk compellingly and elegantly illuminates why listening to your customers with your eyes, your heart, and your instincts is more important than listening exclusively with your ears.”

As a guest, Bueno can discuss:

  • How to generate authentic product gossip
  • The seven principles to sparking customer conversations
  • Why hiring “fake fans” does not work
  • How to successfully deliver your message in our “hypersonic-word-of-mouth world”

Bueno is the co-author of the popular marketing book, The Power of Cult Branding, which received rave reviews from leading marketing mavens like Al Reis, Jay Conrad Levinson and Jeffrey Fox. Bueno is also a partner in Nonbox Consulting, a consumer insight think tank located in Orlando, Fla. He is a member of the Retail Advertising & Marketing Association (RAMA) and is on the board of the Chief Marketing Officers (CMO) for top international retailers. He has advised companies like Kohl’s Department Store, LA Lakers, Thomas Nelson Publisher, Scheels, and the Magic of David Copperfield. Bueno currently lives in Orlando, Fla.

For more information about Why We Talk: The Truth Behind Word-of-Mouth, please visit cultbranding.com/blog.


The Forces Behind Customer Loyalty

Understanding how branding influences decisions

(ORLANDO, Fla.) What attracts people to a particular brand? What motivates their loyalty to a product, or to the brands their parents bought? Why do Oprah, Apple, Jimmy Buffet, WWE, and Star Trek have such a huge following? Marketing consultant and cult- branding expert BJ Bueno’s book, The Power of Cult Branding: How 9 Magnetic Brands Turned Customers into Loyal Followers (Random House/Crown Business, ISBN: 0-7615-3694-9, $24.95), is a fascinating look at how some of the most popular brands created the right combination of position and branding to develop remarkably loyal fans.

The Power of Cult Branding is a fantastic guide for marketers or anyone involved in business wishing to reach their target audience and turn them into repeat customers. It is a smart and savvy presentation of what it takes for a brand to win the positioning battle in today’s crowded marketplace. By presenting case studies of highly successful brands such as Harley Davidson, Volkswagen, and Linux, the book uses tangible examples of success that all marketers aspire to achieve.

“A masterfully instructive book on what it really takes to build a powerful brand today. It should be required reading for students at the country’s top business schools. I recommend it wholeheartedly to entrepreneurs, executives, visionaries, and managers, who should not just read it, but also live by it!” – Edward P. “Ned” Grace III, managing director, Grace Venture Partners

As a guest, Bueno can discuss:

  • What makes a product fascinating to consumers
  • The psychology of marketing and branding
  • The values upon which powerful brands are built and how they connect with human needs
  • The roles customers play in determining whether a brand succeeds
  • Why customers and stores become crazed during the holiday shopping season
  • The branding war during the holidays

Bueno is an innovative marketing consultant and cult-branding expert. He has successfully delivered keynote speeches to the Harvard Business School and other top universities throughout the world, as well as Fortune 500 companies. He is a member of the Retail Advertising & Marketing Association (RAMA) and on the Chief Marketing Officers (CMO) board for top international retailers, which advises companies like Target, Wal-Mart, Washington Mutual, Toys-R-Us and JCPenney. Bueno currently lives in Orlando, Fla. where he enjoys studying and helping clients connect and build relationships with their customers.

For more information, please visit: cultbranding.com/blog