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Cult Branding

Be A Better Brand Manager: Be Willing To Look Within

We all use a mix of rational and irrational criteria when making our purchasing decisions.

An integral part of building a successful retail brand is having a dedicated core of customers who love your store so much that they can’t keep themselves from recommending it to their family and friends.

What inspires this behavior?

Many brand managers are stymied by this question. They fall into an all-too-common mistake, acting as if their customers were an alien species of life, prone to completely incomprehensible behaviors that can’t possibly be understood, much less predicted.

Nothing could be further from the truth.

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Be A Better Brand Manager: Measure Everything

It’s pop quiz time! Where do baby Geckos come from?

If your answer begins “When a Mommy Gecko and a Daddy Gecko love each other very much…” stop now. And this isn’t really part of the ever-popular live birth vs. eggs debate either. Geckos, or at least the Geico Gecko, which is the one we’re particularly interested in, owes its ongoing existence to a very proud set of data.

In an interview with AdAge, Ted Ward, Geico’s CMO, said, “The green scaly spokes-character you reference was actually born in a petri dish of data. The Gecko was ‘hatched’ with absolutely no research or even the intention of producing a long-running, iconic campaign. The fact is we analyzed results from running the first set of Gecko TV spots and liked the bump in business volume. We were able to attribute the increased business to the campaign and decided to move forward with additional Gecko executions. From that point on we have incorporated more traditional market research to track and monitor consumer sentiment related to the little green guy.”

Cult Brands Measure Everything

The measurement-centric approach definitely appears to be working. Geico appears to be on the verge of moving past Allstate to capture the #2 spot in the highly competitive auto insurance industry. Many pundits have attributed Geico’s success to their huge advertising budget, but as we all know, there are plenty of brands out there that do a ton of advertising without achieving a dominant position in their industry.

What makes the Geico story important for brand managers is the explicit relationship between marketing campaigns and the measurement thereof. When Geico knew, with a high degree of certainty, what types of messaging were most effective at capturing both customer interest and business, they were able to replicate the essential elements of that campaign in other campaigns.  Geico’s Cavemen and Maxwell the Pig campaigns were both powerful tools for the brand, but who knows if they ever would have seen the light of day if there’d been no data to support the fact that quirky humor helped sell car insurance?

Being unique in the marketplace is not easy. Creativity requires courage. That creative courage is sometimes at odds with institutional decision makers who prefer a more conservative approach. Measuring everything and making smart use of the data makes it easier to get the creative freedom you need to be an effective brand manager because you can say, with a high degree of certainty, that your campaigns will be successful before you launch them.

Be a Better Brand Manager: The Essentials

Data is your friend. The more you know about your customers, including how they find you, their path to purchasing, and how they talk about you online, the better you’ll be able to serve them.

Data needs interpretation to be a meaningful asset. Ideally, you’re looking for identifiable patterns of behavior held in common by significant numbers of your customers. This will allow you to figure out how well your campaigns are working.

Be willing to accept that data doesn’t always dance the way you want it to. The results of inquiry will not always yield up  the answers you’re hoping to hear. Great brand managers listen to what their customers are telling them.

Be A Better Brand Manager: Understand What Doing Business With You Gives The Customer

Do you recognize that image in the corner? It’s a shot from NBC’s Today show, covering the Cronut phenomenon. Cronuts, in case you haven’t heard, are the legendarily delicious pastry creation of the Dominique Ansel Bakery in New York City.  Only 200-250 are produced each day, and you can only buy 2 at a time.  People are willing to stand in line for hours to get a Cronut, and if you don’t have the time to invest, don’t despair. An underground Cronut economy has sprung up, with scalpers more than happy to sell you the $5 treat for a cool $30.

The media has been going nuts trying to figure out what’s going on here. Reporter after reporter has gotten testimony that the Cronut is, indeed, delicious. But there are over 4,000 bakeries in New York City — and that’s not even counting the street vendors and food trucks that have more than a few scrumptious baked goods for sale.

To understand the Cronut phenomenon, you need to know one thing. The Cronut may be very good. But it is the experience of getting the Cronut that is even better.

Cult Brands Deliver Memorable Experiences

Buying a Cronut is not a simple endeavor. The high demand and low supply requires New Yorkers to do something antithetical to their kind: stand patiently in line and accept the fact that they may, in fact, be disappointed. It’s a low-cost version of the heroes quest. Demands are put upon one, albeit only for patience and civility, and at the end, there’s the uncertain promise of a reward. You may get your Cronut, you may not.

Ultimately, it doesn’t matter whether or not you’ve gotten the Cronut. What matters to the people lining up is that they’ve been part of the Cronut experience. They have a unique story to tell, their own personal angle of the story of the moment. Even those folks who pay scalpers for Cronuts are participating in the larger narrative: for the price of a few dollars more, they can position themselves as the possessor of the smartest sweet tooth.

The stories we tell about the experiences we actually have are most valuable form of social currency we have. Cult brands know this, and go out of their way to provide experiences that are worth talking about. Every time a customer lines up at the Dominique Ansel Bakery, they may or may not come away with a Cronut. But they definitely will have a story that they can tell to their family and friends for years to come.

Be a Better Brand Manager: The Essentials

Having great products and services is only the starting point. To create a Cult Brand, you need to identify and deliver an experience your customers will want to share with all of their family and friends.

The stories we tell about our own direct experiences are the most valuable form of social currency. Customers value these stories more highly than stories they can tell about things that happened to someone they knew or heard about.

Scarcity has its role in the marketing mix. Combining limited supply with a positive experience is an irresistible combination.

Be A Better Brand Manager: Attend the Cult Branding Symposium

Here’s your chance to learn how you can put the secrets of Cult Branding to work for your company. Join BJ Bueno for a focused, growth-oriented session on the forces that influence customer loyalty. The Cult Branding Symposium is your opportunity to tap into the insights, strategies, and unique humanistic approach top brands like Wal-Mart, Coca-Cola, Target, Kohl’s and Scheels used to achieve their dominant place in the market today.

When you attend the Cult Branding Symposium, you’ll learn:

– The Seven Steps to Cultivating Customer Loyalty
– Decoding Brand Communities

With this knowledge, you’ll be able to attract more business and build long-lasting, profitable relationships with your customers. The symposium has been designed to facilitate real learning, with specialized support materials to enhance and augment the educational experience. Symposium participants will receive:

– Hardcover copy of Customers First: Dominate Your Market By Winning Them Over Where They Count The Most (McGraw-Hill 2012)
– Digital copies of the decks presented at the symposium so you can share them with your marketing team (in PowerPoint format)
– Whitepaper, “Why Customers Join Brand Communities” (PDF)

Have You Been Struggling to Bring Your Company to the Next Level?

Building a strong, sustainable business isn’t an easy process. There are times when even the best companies get stuck on the journey from good to great. Consistently, it’s the companies that have the best understanding of who their customers are and the unconscious forces that drive their purchasing decisions that get ‘unstuck’ and go on to become powerhouse profitable Cult Brands.

You don’t have to stay stuck. Space for this special session is limited, and you don’t want to miss out on this unique educational opportunity. Register for the Cult Branding Symposium today!

Mysteries of Retail: How To Remain Relevant In A Changing Marketplace

Do you remember the Magic 8 Ball?

The Toys R Us leadership team could certainly use one, as the once dominant toy retailer appears to be on shaky ground with no clear path to relevancy. A planned IPO was recently withdrawn; the chain’s long time CEO Gerald Storch has stepped down, with no new successor named. Sales slid 3.5% over 2012, and investors are looking at the company’s not-insubstantial debt.

Factors contributing toward Toys R Us slide certainly include competition from Wal-Mart and Amazon. Wal-Mart wins on price, while Amazon’s got both depth of selection and (for their Prime customers) the ability to put any child’s desired toy in their hands within a day. Given this, how can the once great chain expect to compete?

What Makes Customers Choose You First?

Before we can chart a profitable course into the future, it helps to have an understanding of the past. Let’s travel back in time to the late 1970’s and 1980’s, Toys R Us’s glory days. At this time,  the toy market wasn’t as crowded as it is now. Toys R Us was, for many locations, the only game in town. Geoffrey the Giraffe was a well-known and loved mascot. Children everywhere knew and sang the “I want to be a Toys R Us kid” jingle, which had an explicit call out to the desire to never grow up. The joys of childhood could go on forever, if you knew where to shop. It wasn’t exactly Ponce de Leon’s fabled Fountain of Youth, but for the American shopper, it was more than close enough.

Dominant retail brands achieve their position because they provide their shoppers with a compelling emotional experience that is so complete and satisfying that no other store could match it. Toys R Us was hitting many of the same emotional notes that have made Disney so successful. For the kids, that meant wonder, a sense of magic and delight. For the parents, Toys R Us provided something more: an easy-to-navigate route to making at least some of their children’s dreams come true.

It’s important to understand that these emotional triggers are as powerful and compelling as they ever were.  The magic still matters! However, somewhere along the way, Toys R Us lost their ability to hit the target. The experience isn’t what it once was, and absent that, parents no longer have a reason to choose them first. Amazon is always available. No one cruises the toy aisle at Wal-Mart because it is a magical experience.

How do you get the magic back? It’s going to take some serious math. Coupling a statistical analysis of Toys R Us’ best customers’ purchasing behaviors over the course of time with a comprehensive examination of the unconscious psychological factors that drive shoppers decision making will reveal what it takes to fill today’s customers with that sense of wonder, delight, and excitement once again. Provide that, and Wal-Mart won’t matter. Amazon won’t matter.  Give them the magic, and they will come.

Retail’s Biggest Mysteries: Why is JCPenney Only Now Figuring Out What Kohl’s Clearly Knows?

We spend a lot of time considering the mysteries of retail here, but this one’s got us stumped:

Why did it take JCPenney so long to figure out that they should listen to their customers? Sixteen months after rolling out the new “Fair and Square” pricing strategy, the beleagured retailer is now returning to its old pricing strategy. The disappointed masses haven’t exactly been closed-lipped about what the brand was doing wrong. A commenter on the Forbes article, Who Can Save J.C. Penney? spelled things out pretty well:

A big mistake was made when Penney’s eliminated all of the coupons for the allegedly affordable everyday pricing. The merchandise that is now being sold is inferior garbage. Uglier, cheaper made clothes that looks like its for middle aged women. I’m middle aged and I wouldn’t even wear it because the stuf looks like Blue Light Polyester Specials. Even the sales aren’t true sales because that merchandise should be much cheaper on clearance. I know, I was just there last Thursday.

Unless you are trying to kill the brand, please bring back the merchandise of yesteryear. Yes, some of it was pricey but when it went on sale and you used the coupons and the 15% off Internet coupon, oh my goodness, you really felt like you had stolen a bargain. And JCPenney profited, too. Do not underestimate the significance of coupons. Do not underestimate quality. We appreciated the old Penneys. Bring it back or should I sing Auld Lang Syne now?

Cult Branding: Are You Smart Enough To Listen To Your Customers?

The information that JCPenney’s leadership needed to change direction was clearly always there. By every meaningful metric — sell through percentage, same store sales, sales per square foot — the brand was floundering. Consumers and retail analysts alike were telling the brand why things weren’t working. Yet it is only now that we see the JCPenney’s leadership acknowledging, “We now understand that customers are motivated by promotions and prefer to receive discounts through sales and coupons applied at the register.”

JCPenny’s commitment to an untenable strategy demonstrates that the brand lacks the commitment to understand who their customers actually are and what matters to them that is a central aspect of operations at dominant retail brands like Kohl’s Department Stores. One of the primary advantages of this humanistic approach is that retailers are then prepared to determine in advance how effective any marketing or operational changes are likely to be. Given advance information that Fair and Square pricing was going to alienate far more customers than it attracted, would JCPenney’s have gone forward with the plan?

It’s important to understand the essential role played by Kohl’s discounting program. Retailers who are striving for growth in this crowded marketplace need to understand the complete suite of unconscious, psychological motivations that drive their best customer’s purchasing decisions. For whatever reason, JCPenneys decided to discard the powerfully complex appeal of discounting, while Kohl’s made it a central part of their messaging.

The result? Here’s what Kohl’s numbers look like. Here are JCPenney’s.

Retailers that are successful are retailers that are willing to listen to their customers. A comprehensive approach that takes into account both explicit consumer commentary and the historical behavioral patterns driven by unconscious, psychological motivators delivers actionable insights essential for brand growth. Frankly, the JCPenney’s leadership team may have waited too long to get with the program. But that’s not the case for every retailer. Here’s what the alternative looks like.

Retail’s Mysteries Revealed: Amazon and the Art of Picking Your Battles

Amazon understands one of the fundamental truths of retailing, and they’ve demonstrated that with their amazingly successful Amazon Prime program. For years, now, the industry bean counters have been looking side-eyed at the program that offers shoppers free two-day shipping and streaming of digital content in exchange for a one-time annual flat fee payment. It looks like a system designed to fail.

An Amazon Prime membership costs $79 annually. Researchers have found that the average Prime customer was using $90 worth of shipping and streaming services per year. The math seems pretty simple; 90 – 79 is 11. Amazon loses, the customer wins.

Does anyone reading these words really believe that Amazon, the company that tracks customer behavior so closely that they can make personal recommendations to each and every one of their 615 million customers, didn’t know this was going to happen?

Of course they knew. That brings us to the next question: Why would you pick a fight you know you’re going to lose?

Cult Branding: Know Your Customers As You Know Yourself

This is the only time you’ll ever see Donald Trump quoted in this space. “Sometimes by losing a battle, you find a new way to win a war.” Amazon, the company named for a nation of  fierce warrior women, is performing a classical tactical maneuver. There are times when allowing your enemy to gain ground moves them into position to be surrounded. $11 may be lost, but a customer who is becoming increasingly habituated to choosing Amazon as their default retailer is gained.  The average Prime member spends over $1,200 with Amazon annually. The non-Prime Amazon customer spends less than half that amount.

Amazon knows one of the secrets of retail. We may love our customers, but our customers don’t necessarily love us back. There’s an uneven power dynamic inherent in the relationship, and the customer feels like they’re getting the short end of the stick most of the time. Given a chance to even the scales with—or to even get one over on—a business, the customer is going to take it.

Understanding this aspect of human nature allowed Amazon to craft an irresistible offer. They’ve taken on the role of the giant and just handed over a slingshot. In an economic, social environment rife with depressing overtones for the typical buyer—average income growth for 90% of the American population was $59 over the past 45 years—opportunities to come out ahead in the game are few and far between.

We want to embrace our customers, and that can lead us to presume that our customers—especially the best ones—want to embrace us too. But things are more complicated than that. Human behavior is motivated by a wide range of emotions. Not all of these emotions appear attractive or noble at first glance. It’s hard to see the appeal in an adversarial relationship. It can seem counter-intuitive and extremely uncomfortable to consider the entirety of our customers’ perceptions of the brand.

Do we, as retailers, want to do what’s comfortable, or do we want to do what works?