Here's one to wrap your head around: Consumers are not confident in the banking industry as a whole, but they are confident in their own personal financial institution. According to market research company Morpace Inc., 71% of consumers are confident in their primary personal bank. However, only 44% have confidence in the financial strength of banks in general. "It's a lot like people don't trust Congress, but they trust their own congressman," Tom Hartley, vice president of customer loyalty for Morpace, tells Marketing Daily. "People are confident in what they know and what they trust. And if they don't have the confidence in their banks, they would switch." Although they are confident in their personal banks, the financial institutions should take some time to communicate directly and openly with their customers. "Consumers are not panicking now. But there's still a lot of nervousness as a whole," Hartley says. "Banks still need to reassure their customers that everything is fine." The survey of more 1,100 consumers was conducted Sept. 9-16, the week before Lehman Brothers filed for bankruptcy, Bank of America bought Merrill Lynch and the government announced a bailout plan for insurance company AIG. Since then, J.P. Morgan Chase bought Washington Mutual and Citigroup purchased Wachovia Securities. Robert Passikoff, president of BrandKeys, agrees that banks--both as individual institutions and the banking industry--need to be proactive to regain consumers' trust. "This is the financial version of the Tylenol poisonings," Passikoff tells Marketing Daily. "The trust is going to come from the ways companies like Bank of America and JPMorgan Chase are behaving, putting customers ahead of absolute profitability." BrandKeys, which maintains a Consumer Loyalty Index, recently ranked the country's eight largest banks based on consumer trust. Although conducted before the recent wave of purchases, Bank of America ranked highest, and JPMorgan Chase ranked second. Wachovia ranked sixth, and Washington Mutual was eighth.
At press time, the House kicked the bailout package back up the Hill, and stocks were heading downhill in response. Definitely expect any better news from the auto market. On top of stagnant sales from fuel prices, mortgage defaults, and consumer confidence, the credit freeze is beginning to harm auto sales and distribution. Jesse Toprak, executive director of industry analysis at the Santa Monica, Calif.-based Edmunds.com, says lack of availability of credit means dealers can't generate business or be flexible in lending to buyers. "What's true for housing is true for the car market; it has already affected dealers' access to credit lines to finance cars for inventory," he says. "It's coming from all angles. The danger in short term is that the weakest will be eliminated," he says. He says consumers are also holding off. "The indirect impact is psychological, where consumers--even those with the ability to purchase--are postponing because the market is so mixed up. They don't want to spend what they don't have. Now we will see the ownership cycle getting longer." The firm predicts that this month's new vehicle sales will sink to levels not seen since the early 1990s, with about 1.05 million units total for the month. If so, that would be nearly a 20% decrease from September 2007 and a 15.7% decrease from August. Toprak says February 1993 was the last time that less than one million new vehicles were sold in a month. "And we're coming remarkably close to that volume again," he says, adding that next month won't be any better. "October sales are even worse than they are in September, so we don't likely have much to look forward to next month." Edmunds predicts that GM, Chrysler and Ford will hurt the most, and Toyota will see the worst sales drop among Japanese brands. The firm says that adjusted for fewer selling days this month versus the month last year, Chrysler sales will be off 33.8%--giving it U.S. market share of 9.7% for the month; Ford will be off 21.9% and GM will be down 20.7%, giving them 13.1% and 24.3% market share. Among imports, Honda will be down 2.2%, Nissan 7.8%, and Toyota will be off 14.1%. Toprak says the Korean siblings Hyundai and Kia will be flat and down around 16%, respectively. He says imports are weathering the storm better because they have fewer trucks and SUVs, and because of image. "Most consumers think of Japanese brands when they think of product that is 'safe,' meaning decent gas mileage and high resale value--that these will be safe choices during economic uncertainly." Tom Peyton, senior advertising manager at American Honda Motor, says Honda's results reflect a strategy focused on fuel efficiency. "We are very fortunate that we have stuck by our guns all along and tried to focus on fuel efficiency and value, and that's what's selling the market right now. And the fact that we were able to expand production of Fit and Civic helped."
Cisco Systems' latest campaign, "Digital Cribs," pays out about $90,000 in cash prizes to moviemakers that are willing to create documentaries. The three-minute webisodes need to feature celebrities--well-known experts in their field--demonstrating a passion for networking and electronic devices in their homes. The effort to educate consumers on networking products stems from a recent Cisco survey asking people: "Why haven't you gotten a home network?" Answers reveal that rather than price, ease of use or installation woes, consumers do not know the benefits--and those who have home networks don't realize they have one. Many simply use their Cisco-brand Linksys router to wirelessly connect their laptop or PC to the Internet. In the survey, 64% of respondents did not see the need to have a home network, and 16% did not understand what it means to have one. Most responses came from the Untied States and Western Europe. Ken Wirt, VP of consumer marketing at Cisco Systems, says Digital Cribs fits into a bigger Web 2.0 marketing strategy to educate and raise awareness for the networking giant's products and services. "If this is what we're promoting, we have to walk the talk," he says. The quest to find people who have a passion for digital gadgets and networking technology led Cisco--which makes set-top boxes and wireless routers--to market the campaign through www.digitalcribs.com, along with 50 video aggregation sites like Google's YouTube, and 180 social media and blogger sites. Wirt calls the Digital Cribs marketing promotion "aspirational"--an outreach to show how people who are passionate about technology use networking and electronic devices in their homes. To get started, Cisco tapped ad agency Ogilvy to select the first three people for the videos. The webisodes feature video blogger Megan Asha, NBA Houston Rockets basketball star Shane Battier, and video artist Lincoln Schatz. By the end of this year, Cisco plans to debut more than 40 webisodes demonstrating home networks. Some will come from a competition between film school rivals University of Southern California and New York University. Students will produce eight webisodes during the contest, which runs through the fall semester. As part of the Digital Cribs marketing campaign, Cisco signed on with filmaka.com in hopes of getting videographers worldwide on board, too. Moviemakers must submit entrees by Oct. 13. Voting and judging follow. Cisco will award 10 Brand Awards of $7,500 each, 10 Voters Choice Awards of $5,000 each, and a chance to have the clip featured on Cisco.com or in the company's booth at trade shows.
Just a week after replacing its CEO, struggling electronics chain Circuit City posted a $73 million loss for the second quarter. Sales fell 10% to $2.39 billion, with comparable-store sales tumbling 14.4%. And to shore up its turnaround efforts heading into the critical holiday selling period, the company says it will focus on five simple initiatives, including a new marketing brand campaign. "While we have continued to gain traction in key areas, such as improving the close rate trend, rebuilding our selling culture and delivering a better customer experience in our stores, the progress we have made to date has not been sufficient to reverse our overall business results," company executives say in its release, adding that "the performance of the company is unacceptable to all of our stakeholders, and it is imperative that we take the right steps to accelerate our turnaround." The company also withdrew its previous forecast of 2009 results. In addition to its new campaign, which it says will be supported by "relevant traffic-driving offerings," the Richmond, Va.-based retailer also says it intends to focus on enhancing customers' shopping experience, improve its in-stock position on key items and advertised products, upgrade its signage and visual merchandising, and finalize the rollout of its "Simple to Shop" program in home entertainment. Like other retailers, Circuit City has been battered by slowed consumer spending, and says that while it did see a "low single digit" increase in the sale of its flat-panel TVs, sales suffered practically everywhere else, with notebook and desktop computers, video products, video software and music software all registering double-digit declines. Last week, the company said Philip J. Schoonover, chairman, president and CEO, agreed to step down, and will get $1.8 million in severance. The board named James A. Marcum acting president and CEO.
First, Sheryl Crow and Whole Foods announced that the singer would design a brand-new reusable bag. Then Giant Eagle unveiled reusable bags branded with logos of major teams in its markets. And now, Wal-Mart Stores is making even bigger waves in the reusable bag market, vowing recently to reduce its use of plastic bags by an impressive one-third--about nine billion plastic bags--by 2013. It's no surprise that retailers are becoming increasingly enthusiastic about reusable shopping bags. After all, environmentalists have been saying for years that they clog landfills and kill marine wildlife, and cities around the U.S. have either banned them or are considering doing so. What's new is the way that stores are seizing an opportunity to use the bags to refine their relationship with customers. Wal-Mart, which has been selling the bags since 2007 and says it has already eliminated the need for one billion plastic ones, says it will step up its commitment by reducing the costs of its bags in the U.S. A new blue one--which holds up to 22 pounds--will sell for 50 cents starting next month, and a black one, which can tote up to 35 pounds, will sell for $1. "For Walmart's identity, these bags make perfect sense--they are a great value, and they fit right in with the store's image of not wasting money," says Erin Read Ruddick, client services director for Creating Results, a strategic marketing company in Barrington, RI. "Not wasting things is just good Yankee thrift, and it goes to the core of the chain's identity." But by incorporating an affinity element into bags, Ruddick says, stores can go even further so consumers get to say something about themselves beyond, "I'm a green person and I shop at X or Y." For example, Giant Eagle urges its shoppers to "Go Green, Go Team," and is offering the bags with such logos as the Pittsburgh Steelers, the Cleveland Browns, and the Ohio State Buckeyes. And the Whole Foods bag, available Oct. 15, features a charcoal sketch of a tree with words written by Crow woven into the artwork. Consumers "are looking to make a connection, and it's a way for brands to speak right to people's core values," Ruddick says. "You're not just asking them to walk around with your logo; the bags give them a chance to say something about themselves. It's very smart." Wal-Mart's comprehensive bag reduction strategy is being developed in partnership with Environmental Defense Fund; Whole Foods is working with the Natural Resources Defense Council.
Honda has signed on as exclusive automotive sponsor of Walt Disney Pictures' "High School Musical 3: Senior Year." Honda's co-branded campaign for the film, which opens Oct. 24-- includes TV spots, radio, print, and online elements. The film also features a raft of Honda vehicles, including a Honda Odyssey minivan driven by Gabriella's mother, Mrs. Montez; a pink S2000 coupe driven by Sharpay, a Pilot compact crossover and a Civic Hybrid. The effort will include a cross-branded 30-second TV spot for the Odyssey that will run on cable networks and network shows in October, and a branded spot on the Disney Channel. One spot shows the minivan "driving" through the animated world of a Wildcats senior yearbook. A co-branded site, www.Disney.com/RidewiththeWildcats, which goes live on Sept. 29, lets visitors watch videos and play a thematically related driving game. The site also hosts a sweepstakes, "Ride with the Wildcats," offering a new 2009 Honda Odyssey and autographed props from the feature film set as the grand prize. The promotion gets support from a 45-second TV spot on Disney Channel, a 30-second spot on Radio Disney, a full-page co-branded ad in the November issue of Family Fun magazine and a one-third-page follow-up ad announcing sweepstakes winners running in the April issue. Tom Peyton, senior advertising manager at American Honda Motor, says Honda is reprising a role it had in "High School Musical Two." "We started with Disney a few years ago when we became a partner of Disney Land," he tells Marketing Daily. "That gave us inroads to talk on other projects." He said that while other Honda vehicles are spotlighted in "HS3," "it is primarily about Odyssey. We're trying to reach families; these are the right households for us to talk to."
Leading technology marketers -- faced with product offering parity/commoditization, intense global competition, and stagnant budgets -- are seeking every way possible to improve the performance of their marketing programs. One strategic approach is the adoption of radically customer-centric marketing -- allocating significant resources toward developing the deepest possible understanding of customers' roles, responsibilities, communities, hopes, dreams and aspirations -- moving far beyond the "title targeting" that has defined technology marketing for decades. Here's how. Know Your Customers Personae are hot - but they are not new. Direct marketers have been using attitudinal and behavioral segmentation for decades. What is new is that the web enables more efficient development of personae based on how prospects interact with brands online -- and the use of personae is more efficient due to the hyper-targeting capabilities of online message delivery. Additionally, the best technology marketers have added role-based profiles to their segmentation strategies - building profiles of multiple IT decision makers, capturing and leveraging understanding of each person's role in the purchase process and varying messaging based on their role. Effective personae and role-based profile development requires a combination of approaches including: ? Primary research - qualitative and ethnographic "day-in-the-life" research ? Data analytics - utilizing sales, campaign and engagement data to understand the actual behavior of customers and prospects ? Sales force engagement - talking with your best salespeople to understand "deal dynamics" and translate that knowledge into targeting and messaging Combining research, data analytics and sales engagement is a proven approach to building actionable personae that informs hyper-targeting and hyper-messaging for optimal campaign results. Corporate Brand Matters - More Than Ever Decades of research continues to prove that companies "buy" companies first, then products and solutions. The web can trigger the hyper-development or hyper-destruction of brands. So given how quickly digital technology is changing marketing dynamics, how quickly people learn about the differences between one brand and another, and how quickly word spreads, getting the positioning of your brand "right" has never been more important. Additionally, in a transparent and sharable environment, there are more ways than ever before to find out what matters to your brand constituencies. The best marketers listen to what audiences think and feel about the brand's products and services. Smart brands collect and use this learning to build brand promises that are both different from competitors and optimally relevant to the customers they want to attract. Maximize The Mix One of the most challenging tasks is identifying how to allocate finite resources (i.e., budget) into what increasingly feels like an infinite number of marketing channels. A radically customer-centric approach helps identify the likely highest yielding channels through better understanding how customers collect information about competitive products and services. Social media monitoring is increasingly playing a valuable role as peer recommendations remain among the most trusted sources of product information. Understanding where customers congregate and monitoring those conversations, is aiding in the development of more relevant channel plans. Social media monitoring combined with traditional media consumption research and analytics is creating radically customer-centric, high performance media plans. Drive Leads That Drive Sales Still surprising are the number of organizations who value lead quantity over quality - unfortunately, they appear to remain the majority. Best of breed marketers view this differently. The goal of any demand generation program should be generating the largest number of most highly qualified leads possible, generated at the lowest possible cost. Optimally targeting high potential value customers is best achieved through applied data analytics of current customers to understand; what are the key characteristics of my best customers? What did they buy? When? How much are they worth? Data analytics helps greatly narrow the population for promotion, but unless you combine this effort with customer-informed messaging your effort will be efficient but not optimally effective. Which is the reason we need to get to the "why of buy". The best marketers understand why customers buy from you or from others. It's easier than ever to learn. Again, social media monitoring, complemented by qualitative and quantitative research intent on understanding why we buy, leads to radical customer-centricity that can more effectively and efficiently drive demand. Measure, Optimize, Repeat As companies execute radically customer-centric marketing programs it's easier than ever to learn more and more about customers and prospects with each campaign. Leaders are measuring three key metrics: ? Perception - how do customers and prospects "feel" about the brand? ? Performance - how are they responding to marketing campaigns? (campaign metrics) ? Value - what incremental revenue are your radically customer-centric marketing programs contributing to the company? Get Radical - Today The best technology marketers understand that radical customer-centricity results in more efficient, effective, revenue-generating marketing campaigns. Taking the time and applying the resources necessary to deeply understand customers behaviorally, attitudinally and communally makes the results of their finite budgets infinitely successful.