Browsing Tag

Customers First

Up In Smoke: What To Do When Your Market Disappears

Last week, we talked about a powerful Thai campaign designed to encourage people to stop smoking. There are lots of people who get pretty happy when folks kick the cancer-causing habit, but we have to admit that the sentiment is hardly universal.

Tobacco farmers aren’t big fans of the stop-smoking movement, as you might expect. Fewer smokers means a smaller market for their crop.  Other companies are feeling the pinch too. Cigarette and pipe manufacturers, ash tray makers, and lighter companies are all experiencing dramatically declining domestic sales.

What’s going to happen to these brands if the whole planet eventually goes smoke free?

Let’s look to history for some answers. After all, it’s not the first time consumer demand for a product has dropped off precipitously. Markets can and do disappear.  Have you tried to buy an 8-track player recently? Good luck with that. The same thing can be said for floppy disks and manual typewriters. Try locating a pay phone somewhere near you. It might take a while.

When a market disappears, the companies that depended upon that market tend to choose from three options. One option is to hang in there, catering to the nostalgic customer. Markets never disappear entirely. Did you know that there are still zeppelin manufacturers? Another option is to go out of business entirely, and a third option, far more popular, is to stay in business but change what you do. The Royal Typewriter company, for example, today specializes in consumer information technology, including cash registers, shredders, and copier supplies.

Understanding Your Customer’s Unconscious Expands Opportunities

There is another option for companies facing a dwindling marketplace, but it’s only open to those brands who have a deep and comprehensive understanding of the unconscious psychological motivators that drives their customers to choose them over all other competing brands. In this strategy, you continue to do what you do, but you present it to your customers in a whole new way.

For example, let’s look at Zippo. Full disclosure: we wrote about Zippo in Customers First, discussing their dubious brand extension into the world of fine fragrances. Now, however, we think the brand is on the right track as they embrace a new strategy.

Zippo built their brand by positioning themselves as the lighter of choice for the rugged, resourceful man. Their customers saw themselves as can-do guys, who wouldn’t let something like a little bit of wind stop them from enjoying a cigarette when they wanted one—or from being there for a damsel in distress who needed a light.

That wasn’t all. Zippo lighters made it possible for the average Joe to tap into his inner MacGyver. Portable, dependable fire is a handy tool to have. You can start a signal fire. You can smooth the end of a fringed, frayed rope. In a pinch, you can warm canned food with a lighter. In a really bad pinch, you can even cauterize a wound—although we, ourselves, would never recommend such a thing!

Zippo understands that their best customers may never, in fact, use their lighters to do any of these things. Chances are that they’re much more Yogi Bear than Bear Grylls. That doesn’t matter. They’re far more likely to do these things than they are to smoke, and having a Zippo makes it possible.  What Zippo is selling here is empowerment. When a man uses a Zippo, he’s able to connect with a powerful archetypal masculine image that resonates on a deep and primal level. It’s a tangible way for consumers to connect with an internalized vision of their best self.

You’re just not going to get that from flicking your Bic. We’ll see what happens over the coming years.  We’re fairly confident that the smoke-free trend is going to continue. Habits change, even deeply ingrained habits like smoking. But unconscious psychological motivators? Those are constants—and those constants can be used to ensure brand longevity, even when an entire market goes up in smoke.

Nestle: Trust Building Is Essential To Our Success

Nestlé corporate logoAlmost two years ago, Jose Lopez, executive VP of Operations for Nestle, was explaining to the Business Standard why the global foods, health, and nutrition brand, which claims to have a billion customers a day, is so successful. A particular focus of the interview was how Nestle decided to enter a marketplace, as well as their decision to source raw materials and labor in local markets.

What is revealed is that Nestle places a high value on knowing their customers, on a number of levels.  They’ve identified the universal concerns that cause their best customers to choose Nestle brand products rather than any other—product safety and high nutritional value tops the lists—and the local, market-specific criteria that helps Nestle bond with customers on an individual basis.

“Our factories here (in India) use Indian raw materials produced by Indian farmers to make products that are made to Indian tastes and are sold in the country. That is the way we operate.”

Nestle has been successful with this approach. The growth continues, according to this recent Wall Street Journal article, Nestle Projects Growth from Emerging Markets.

Customers First: How Nestle Reached the Top

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Lopez is very forthcoming about the reason for Nestle’s growth. “The first thing that comes to mind is clearly the trust that we have been able to build in our consumers. Second, is our passion for quality, and third, simple and clear business processes.”

Building that level of personal, profitable trust with customers is directly dependent on superior levels of customer knowledge.  Before you trust someone, you have to know them, and before that trust can be returning in any meaningful way, they have to know you. Transparent business practices are essential (and if Nestle has had stumbling blocks along the way, it has always been in those areas where they are perceived to be less than transparent in their marketing practices, particularly in the area of infant formula).

In Customers First:Dominate Your Market By Winning Them Over Where It Counts the Most, we examine some of the powerful unconscious psychological forces that motivate customer behavior.  There’s a universal need that we all share: we have a profound need to believe that we belong to a group, that we are valued and cared for as a member of society. We want to know—no, scratch that; it’s that we need to know—that we’re cared about.

This is a message that must reach the customer’s ears, heart, and mind. It’s always good to have the leadership spelling it out. In the Business Standard interview, Lopez said, “We want to provide the consumer a good diet. In addition to formulating such products, we want to teach them what’s good for them. Every Nestle product has a nutritional panel or compass on the pack which helps in understanding its nutritional value. The nutritional aspect of the products is what pleases the consumer, but it is also our responsibility to explain to him why it is good for him. The last thing we want is our consumers becoming victims of lifestyle-related diseases.” (emphasis ours)

Nestle’s making use of every touch point to convey their care and concern for customer health. Couple this with the substantial commitment the brand has made to understanding their customers wants and needs, and it becomes easy to see why the Nestle brand is one of the most successful in the world.  That’s what happens when you put Customers First!

Check Out the New Book: Customers First: Dominate Your Market By Winning Them Over Where It Counts The Most

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Customers are skeptical. They’ve been lied to by just about everyone who’s had the opportunity to do so. From role models who can’t keep extramarital affairs from wrecking their golf game to behemoth corporations betting against their own customers’ investments to politicians regularly resigning for engaging in the very activities they legislated against, no one has been telling the truth. You need an element of trust to get genuine customer buy-in, but we’ve spent a generation and a half teaching the
public to trust nobody.

This creates a problem for today’s business leaders. How do you connect with these empowered, educated, skeptical consumers?

This is a question of some urgency. If you don’t have the answer, you have to figure it out now, and you have to keep your business thriving at the same time. There’s absolutely no time to hesitate. If you cannot connect with your customers in a meaningful way, you will become irrelevant to them. When you’re irrelevant, you’re replaceable, and your customers will inevitably replace you with a brand that they do feel connected to.

Irrelevancy arrives in those still moments when an organization is facing uncertainty. These are the times when the
company is trying to figure out what to do. Choosing the right course is difficult: if you opt for the wrong direction, you’ll saddle your company with the burden of invisibility when you’re least prepared to bear it.

Customers First: How To Choose The Right Course Consistently

Choosing the right course is difficult, but it’s not impossible. Dominant organizations—companies like Nike, Apple, Harley-Davidson, and Ikea—seem to consistently pick the right course. They seem to know what the customer wants, even before the customers know they want it. They enjoy unparalleled customer loyalty, and that’s not all.  Dominant organizations seem to make fewer mistakes than their competitors. They make better decisions and enjoy greater profitability.

As a business leader, don’t you want to know how that happens? Don’t you want to be able to do it too? It’s possible when you have the right tools. That’s where Brand Modeling comes in. We’ve been doing exciting work, helping leading companies delve into the unconscious psychological factors that drive customer behavior, pinpointing those places where brand and consumer can form strong, lasting, and profitable bonds.

When you’re equipped with a comprehensive, multi-dimensional understanding of your customer, you can consistently choose the right course for your company.

That’s the topic of the new book, which is now available for pre-order on Amazon. I have to say, we’re pretty excited about this book. We worked hard to create the most complete, accessible explanation of the combination of complex psychological factors that control consumer behavior and what they mean to good companies striving to become great companies. Brand Modeling can provide your company with an unbeatable competitive advantage. You might want to check it out!

Ace Hardware: Putting Customers First in a Quest to Double Market Share

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Normally, when we talk about watching paint dry, we’re referring to something tedious or boring. But for the leadership at Ace Hardware, paint is pretty exciting.  According to this New York Times article, a new product line (coupled with an insightful marketing approach) may be what it takes to allow the 4,300+ hardware and home improvement store chain to double their share of the domestic paint market.

Brand Modeling and the Search for a New Growth Strategy

Dominant organizations are engaged in a continual search for growth opportunities.  What are the best ways to increase market share, raise a brand’s visibility, and connect more effectively with their customers? It’s easy to generate potential strategies that should create growth, but it’s remarkably difficult to assess ahead of time which strategies are going to succeed.  It’s even tougher to tell which campaigns will be the most successful and deliver the highest return on investment.

Which brings us to Ace Hardware.  This well-established brand has numerous options available to it. Ace Hardware has the resources and ability to pursue growth in any of several directions.  We think that Ace’s leadership team has made a smart decision by focusing on the paint portion of their business. Their approach shows that there’s been a concerted effort to understand and better serve their customer.

Know Your Customer To Build Your Brand

What is the power of paint? Some analysts have compared painting the house to the famous lipstick effect—a quick and affordable way to lift the spirits when it’s not economically feasible to make larger, more indulgent purchases.  Ace Hardware’s customers may not be in a position to renovate the entire kitchen or do over the bathroom. Yet they’re still driven by the need to make positive changes in their environment.

Painting a room delivers a powerful visual and emotional impact for a relatively small financial investment. Ace is demonstrating superior customer knowledge by providing a way to fill a significant emotional need while being sensitive to the current economic tensions and challenges their customer base is facing.

At the same time, Ace has used a very gender-specific, romance-oriented approach to marketing their new line of paint. Color choices are overwhelmingly made by women, according to Dana Larsen, an Ace Brand manager. The new campaign is based around the need for strong, satisfying, loving relationships—finding the perfect shade, color, or hue is referred to as finding your “soul paint.”

This recognizes and capitalizes on the biological driver that urges us to form lasting bonds. Couple it with some visual humor (after all, there’s something inherently funny about a line-up of 8 purple people) and you have a message that appeals to Ace’s customers on a number of levels.

Will Ace be able to meet their goal of doubling their market share by 2015? Appealing to their customers through multiple psychologically-appealing channels is not a bad start.  Understanding the tensions and pressures facing their customer base, providing an economical means to satisfying compelling emotional needs, and honoring the underlying unconscious drivers of customer behavior are all steps dominant organizations use when they want to grow.  That’s the value of putting customers first.