Archive for the 'Jim Sullivan' Category

Fall Into The GAP

Published on October 25, 2010 in Jim Sullivan. 0 Comments

The world of brands and marketing crossed a threshold this past month. GAP, the iconic American retailer, reversed course and halted the relaunch of a new brand logo in the face of massive negative online public comment about it. Remarkable were the sheer number of alternative logos developed and suggested from individuals via social media. Further, the company issued a press release to apologize for having failed a.) to appreciate the depth of feeling consumers had about the change and b.) to leverage the new technologies as tools to assist the change.

In its press release, the company stated:

“We’ve learned a lot in this process. And we are clear that we did not go about this in the right way. We recognize that we missed the opportunity to engage with the online community. This wasn’t the right project at the right time for crowd sourcing.

“There may be a time to evolve our logo, but if and when that time comes, we’ll handle it in a different way.“

Crowd sourcing is a means by which companies leverage online social technology to elicit broader thinking and input from interested contributors. Frito-Lay, for example, utilized crowdsourcing to air a TV spot for the 2009 Super Bowl that was developed for $2000 by a couple of brothers named Joe and Dave Herbert. Their commercial, “Free Doritos,” took top honors among critics and fans alike as the favorite ad aired on that Super Bowl. The Herbert brothers split a $1 million prize from Frito Lay. Fame and fortune…not bad for a day’s work.

GAP learned this week first-hand that things that used to be totally in their control, like their brand, are no longer theirs exclusively. Sooner or later, all brand marketers and top management groups will realize the same truth. Consumers have taken control. The insatiable needs to exchange ideas, share opinions, and be heard, now enabled by social media technologies, have changed the game of marketing. For that matter, all these forces are changing the nature of management, too. Check out www.glassdoor.com if you want to see the titles, salaries, and ratings of management inside any major company.

No longer is it possible to “promulgate from on high” a tightly refined message, and control its distribution to the uninformed masses. Monologue out. Dialogue in. Even the word “dialogue” doesn’t really capture what’s going on. That implies a two-party conversation. This is different. It’s a multi-party global conversation…more like a “colloquy”…don’t you think?

Whether we like it or not, we are now in an era of near-total transparency. The boundaries that used to define our companies have gone porous. Carefully crafted brand positioning and personalities are subject to crowd approval. Brand equity is a matter of external opinion. Cultural warts and leadership weaknesses are in full view through glass doors.

About the Author

jim sullivan-guest author phenomena.com

JimSullivan - Partner, COLLOQUY & Guest Blogger for phenomena.com

Jim directs the advancement of enterprise loyalty at COLLOQUY, an endeavor guided by his almost 30 years of managing in marketing, strategic planning, business development, innovation, and communications. Jim also assists with COLLOQUY’s loyalty workshops, seminars and conferences, and serves as an academic liaison for colleges, universities and thinking institutions performing research on Enterprise Loyalty.

Prior to joining COLLOQUY in 2010, Jim founded his own company and was a principal at BUILT TO LEAD, a leadership development practice based in Central Ohio. From 1997 to 2008 he worked at Alliance Data Inc., most recently as Chief Marketing and Planning Officer and as a member of the Executive Committee for the Retail Services division. Earlier, he served as Senior Vice President at Information Resources Inc., consulting with such clients as Procter & Gamble, Kraft USA and ConAgra frozen Foods.

A resident of Columbus, Ohio, Jim serves on the Advisory Board of The Initiative for Managing Services at The Fisher College of Business, The Ohio State University, and is an MBA-level instructor in Services Marketing at OSU. He and his wife Lauri have three children.

Deploying Social Media to Cultivate Customer Loyalty

Published on October 17, 2010 in Jim Sullivan. 0 Comments
In mid 2010, Facebook passed the 500-million-user mark, a milestone that certainly fuels marketers’ already-strong incentive to accelerate the transition out of the experimental stage of the social media era.

This transition confronts marketers with a dual challenge. First, new media spending may be difficult to justify in what feels like a never-ending recession, yet neglecting the present opportunity to learn how to utilize these new channels now may doom your company to second-place status for years. You must “ante-up” now. Second, the game will be risky, since there are few well understood strategies and almost no “best practices” to easily fall back on. You’ve got to throw your chips in and build your strategies as you learn.

This paradoxical challenge is a lot like the dynamic at a poker table. Poker is an exercise in intense competition and odds calculation where no one is certain what cards anyone else is holding. Similarly, the process of setting social media strategies and budgets in this competitive economy inevitably involves evaluating your cards, estimating where your best bets will be, studying your competitors’ moves, having the discipline to fold on losing hands, and even bluffing a little when you need to. Most of all, it means learning more rapidly than the others at the table.

Let’s take a peek at the face-down cards. U.S. companies using social media primarily to deepen customer loyalty spend almost twice as much as competitors who use it for brand awareness, customer acquisition and other core marketing purposes, according to a recent survey from COLLOQUY and the U.S. Direct Marketing Association (DMA). This email survey tapped the expertise of COLLOQUY subscribers and DMA’s nationwide membership, obtaining 369 valid responses from marketers to a 17-point questionnaire.

The survey found that loyalty marketing objectives have called and raised the bets of other social media plays. The average amount devoted to social media among companies with a primary focus on customer loyalty objectives was found to be $88,000 in 2009, compared to $53,000 in companies devoted to brand awareness and $30,000 to those seeking new customer acquisition, the three objectives that attracted the next highest spending levels. Additionally, the survey showed that the average spending on a social media budget to achieve loyalty objectives increased by 193% over the previous 12 months, which easily trumped social media allocations geared to other marketing goals.

While this data offers some direction for future social media spending, these remain divergent times for marketers. Despite having some spending profiles available and several years of experience in the space, active learning continues. Marketers who experiment in the new frontier and pursue the cultivation of customer loyalty using social media, like the canny poker player who resists the urge to draw to an inside straight, must exercise the same discipline they’ve traditionally applied to other channels.

As a starting point, marketers should lead with their strong suit by harnessing the power of their loyalty program to identify their brand’s word-of-mouth (WOM) “Champions.” These are consumers who are both influencer in their social circles and advocates of a brand. Previous COLLOQUY research shows that WOM Champions can be found most easily in the marketer’s loyalty program. A much greater percentage of loyalty program members, 70% more to be exact, are WOM Champions than the percentage among general consumers.

And savvy marketers will recognize that winning the most hands at the social media poker table will require turning first to their best customers and applying the same principles inherent to loyalty—which are combining economic incentives with social capital. Target some of your social media spending directly at your program membership, with offers and strategies that get the Champions talking. Offer these Champion customers the opportunity to become brand heroes who serve as the go-to resource for the network.

Brainstorm other ways to identify and leverage WOM Champions to help you identify new customers. Also, marketers must develop proprietary WOM metrics. They should leverage familiar best practices to measure social media success, including click-through rates or page-visit frequency, the good old-fashioned metrics that have been used in other channels.

Though the players in the game of social media may seem quite different, and the table stakes particularly high, experienced direct marketers know many of the rules already. The game is about connection and conversation, modifications of familiar rules of engagement of direct marketing. Some marketers make the mistake of becoming preoccupied with the novelty of social media, and analyzing which specific social media sites are here to stay and which will flame out. This time-waster misses the main point, because what’s not going away is social media’s platform for real-time connection and conversation, two characteristics that make social media an excellent venue to engage consumers. Loyalty practitioners should feel comfortable knowing that even in this new frontier the three R’s still apply. No, not “readin’, writin’, and ’rithmetic,” but reward, recognition and relevance. These three remain the keys to enticing customers to pay attention, even in a busy and fragmented environment. As in poker, the hands may change from game to game, but the basics of play remain the same.

About the Author

jim sullivan-guest author phenomena.com

JimSullivan - Partner, COLLOQUY & Guest Blogger for phenomena.com

Jim directs the advancement of enterprise loyalty at COLLOQUY, an endeavor guided by his almost 30 years of managing in marketing, strategic planning, business development, innovation, and communications. Jim also assists with COLLOQUY’s loyalty workshops, seminars and conferences, and serves as an academic liaison for colleges, universities and thinking institutions performing research on Enterprise Loyalty.

Prior to joining COLLOQUY in 2010, Jim founded his own company and was a principal at BUILT TO LEAD, a leadership development practice based in Central Ohio. From 1997 to 2008 he worked at Alliance Data Inc., most recently as Chief Marketing and Planning Officer and as a member of the Executive Committee for the Retail Services division. Earlier, he served as Senior Vice President at Information Resources Inc., consulting with such clients as Procter & Gamble, Kraft USA and ConAgra frozen Foods.

A resident of Columbus, Ohio, Jim serves on the Advisory Board of The Initiative for Managing Services at The Fisher College of Business, The Ohio State University, and is an MBA-level instructor in Services Marketing at OSU. He and his wife Lauri have three children.

Would You Be Loyal to You? – Loyalty, somewhat like charity, begins at home-the home office that is

Published on September 27, 2010 in Jim Sullivan. 0 Comments

The best marketers have mastered the art of getting people—specifically, customers—to change behavior. Profitably. Predictably. And consistently over time. This is a remarkable talent.

I myself find it hard to get people to change. For example, when I tell my teenagers to, shall we say, adjust their behaviors, they seem to get irritated and usually don’t follow through—for some reason. I then escalate the strategy and sell the benefits of the change I seek. I review the current deficient state (about them), develop attractive outcomes (for them), and enthusiastically present those benefits (to them). This strategy demonstrates slightly better response, but its high wear-out factor generates a lousy ROI. So as not to threaten my self-image as a marketing artist, I resort to the time-honored strategy of compelling them to change with an offer they can’t refuse. This has great short-term response, but I suspect my kids’ long-term loyalty to that brand of parenting may be declining.

Telling. Selling. Compelling. How well have these worked for you? Or the better question: How often have you changed your behavior based on someone telling, selling, or compelling you? Because we humans are biased in our perceptions and worldview, these strategies don’t work very well to promote lasting change. Either the results don’t measure up to the effort required or the relationship degrades over time—not exactly a loyalty marketer’s dream. Human beings commit to change their behavior only when they change their fixed thinking and attitudes. In other words, when they are darn good and ready.

Over the years I’ve picked up a fourth approach to profitable, lasting change management. I call it “Dwelling”—living into the situation of those you would change, and making the wise decision to change yourself from within that experience. As Gandhi said, “Be the change you wish to see in the world.”

When we dwell in the situation of the other, three important things happen: First, we come to understand. Not merely “learn” cognitively, but also “feel” deeply and emotionally the other’s situation. Second, we change. We resolve previously unrecognized blind spots in our understanding as we “adjust our mirrors” to see a suddenly clearer reality. Third, and most important, the intended objects of our original change-management quest recognize how we’ve changed and become more willing to change along with us.

As a loyalty-marketing discipline, “dwelling” can be accomplished through a few straightforward actions:

Eat your own dog food: When I was a food-industry brand manager, I participated in tasting sessions to judge product quality. Those were fun when I worked in Cereals and Snacks. Not so much in Pet Foods, where one R&D scientist actually taste-tested his creations. That type of deep commitment became known as “eating your own dog food.” Most marketers visit their stores and may shop their brands. True professionals live into their brands as customers. That means staying in your hotels, eating at your restaurants, flying your routes, listening to your call centers, and using your own credit and payment cards.

Learn loyalty: Participate in your loyalty program. Granted, this isn’t always possible or desirable. You may be employed by a health care facility and be perfectly fit, or by a child-oriented retailer and not have kids, or by a brand of adult diapers and…well, you may not need your company’s products (at least not yet). In such cases, organize and joinloyalty customer user groups. Dwelling transcends merely sampling your customers’ interaction with you, and then heading home for a cold one.

Seek status: Become a “best customer” to experience the loyalty features and benefits—and the hassles and limitations—encountered by your actual best customers. Build your balance, earn your status, redeem your rewards. Similarly, every one of your company’s senior leaders should be active in your loyalty program. I know a loyalty practitioner whose entire executive committee publicly tallies their monthly program activity in a friendly yet serious competition for top status. They of course have no trouble understanding their program’s design, or recognizing improvement recommendations when they see them. In fact, they themselves have initiated many enhancements.

When your best customers perceive that you care about your loyalty program not just as a marketer, but as one of them, you’ll have a better program. And you can look in the mirror and answer “yes” to the question “Would you be loyal to you?”

About the Author

Jim directs the advancement of enterprise loyalty at COLLOQUY, an endeavor guided by his almost 30 years of managing in marketing, strategic planning, business development, innovation, and communications. Jim also assists with COLLOQUY’s loyalty workshops, seminars and conferences, and serves as an academic liaison for colleges, universities and thinking institutions performing research on Enterprise Loyalty.

Prior to joining COLLOQUY in 2010, Jim founded his own company and was a principal at BUILT TO LEAD, a leadership development practice based in Central Ohio. From 1997 to 2008 he worked at Alliance Data Inc., most recently as Chief Marketing and Planning Officer and as a member of the Executive Committee for the Retail Services division. Earlier, he served as Senior Vice President at Information Resources Inc., consulting with such clients as Procter & Gamble, Kraft USA and ConAgra frozen Foods.

A resident of Columbus, Ohio, Jim serves on the Advisory Board of The Initiative for Managing Services at The Fisher College of Business, The Ohio State University, and is an MBA-level instructor in Services Marketing at OSU. He and his wife Lauri have three children.