All posts filed under: Leadership

Affirmation: how to make a brand experience really count

By Mark Di Somma

Everybody wants to feel they got value for money. Sure – but when exactly does something feel like it was “worth it”? For example, Lady Gaga’s just wound up a three concert stint in Auckland. When does a concert experience feel like it’s worth it? Is it when you finally see the star in person as they step onstage days, weeks, months after you bought the tickets? Is it at the end of the opening number as the crowd erupts? Is it at the end of the show as you fight your way home through the traffic, images of the last couple of hours running through your head? Is it during your favourite song? Or is the value for money moment when you’re telling friends your “I was there” story via Facebook or, days or months later, over dinner? When does a film feel worth it? How about the experience of buying a dress? When do you think the keynote speaker at a conference has delivered or is delivering value for money? At what points …

Retail brands: price always has a context

By Mark Di Somma

Marianne Bickle takes JC Penney’s to task over their pricing strategy in this pithy and thought-provoking post in Forbes. In it, she argues that the retailing icon misread the market in key ways and compromised its value proposition when it replaced its famous coupon and discounts pricing strategy with a policy that stressed continuity, consistency and predictability. People buy emotionally, argues Bickle, and that emotion extends beyond the shop doors. It reaches all the way to the macro-environment that influences their wallets. It’s critical therefore that brands understand how their consumers feel about the economy. If things feel uncertain – and nearly two-thirds of JC Penney customers were saying they didn’t feel the economy was strong – don’t change what they know. It not only makes a new pricing strategy undesirable, it’s also destabilising. And people are much less prone to buy when things don’t feel as they have. It’s also vital, Bickle points out, that brands understand how people buy, not just what they buy. In the case of JC Penney, over 60% of …

Is the digital economy actually an economy (yet)?

By Mark Di Somma

Some years ago, I wrote a post that took Chris Anderson’s “freemium” model to task. In it I argued that once you had provided services and information freely, the conversion to payment was going to be a lot tougher. Free, I suggested, would become an implicit entitlement. Last week, in a withering attack in the New York Times, Ross Douthat lashed out at what he called “The Facebook Illusion”. Comparing Web 2.0 to the home ownership bubble, he took particular aim at the world’s biggest social networking site. The relative disappointment of its IPO should be read, he maintains, not as an indication that Facebook doesn’t make money, but rather that “it doesn’t make that much money, and doesn’t have an obvious way to make that much more of it, because … it hasn’t figured out how to effectively monetize its million upon millions of users … This “huge reach, limited profitability” problem is characteristic of the digital economy as a whole.” It’s probably a little early to call Facebook. Whether the IPO misfired or …

The portfolio approach to strategy

The portfolio approach to strategy

By Mark Di Somma

How do you drive home a strategy to fulfil your future, when everything around you is changing?  The secret, according to McKinsey & Co senior advisor, Eric D. Beinhocker, is to radically review what we mean by strategy. In his 2006 book, The Origin of Wealth, Beinhocker argues that rather than thinking of strategy as a single plan built on predictions of the future, we should think of it as a portfolio of experiments, a population of competing business plans that exist within the decision making process but evolve over time.

Brand dynamics: the shapeshifting of brand likeability

By Mark Di Somma

Our traditional view of product preference has for many years mirrored our view of markets. A bell curve, where products rise in popularity over time, sustain leadership through a period of maturity and then decline or are overtaken by another bell-curve driven by product development that supersedes the declining model and looks to take it to new heights. That model’s driving dynamic is demand. Its chief metric is volume. And its key pressure is time. The longer you can draw out that curve, and the more you can slow down the roll at the peak of the curve the more likely you are to make money. Recently, two separate pieces of thinking have caused me to believe that this likeability model is now as good as dead. Firstly, two thoughts from a really fantastic guest post by J Walker Smith at the ever-inspiring Brand Strategy Insider: “With social engagement more prevalent and more powerful, every marketing message is now subject to vetting by a crowd. No message finds its way to consumers absent the influence …

Is your brand ready for the experience war?

By Mark Di Somma

Thanks to Cato who once again this year kindly invited me to the Wellington simulcast of the AG Ideas Business Breakfast held in Melbourne yesterday. The theme for the AG Ideas 2012 Business Breakfast was how companies could use design and innovation to compete effectively in high-cost economies. Technical issues prevented those of us on this side of the Tasman getting the video feed, but there was plenty to listen to, as Dana Arnett, Dale Herigstad, Mauro Porcini and MC Göran Roos steered us through the morning. Today, I want to touch on a couple of points raised by Göran Roos in his opening statements and one or two takes on an interesting, point-packed address from Mauro Porcini, Chief Design Officer, 3M. Porcini pitched a new social scenario; one where consumers are not just savvy, expert and demanding, but also difficult to categorise and understand because of four overlapping generations (boomers, X, Y and Z) and different geographies and cultures (which themselves were in different states of market maturity). The emergence of this social scenario, …

Brands shouldn’t try to make sense

By Mark Di Somma

The flipside of a marketplace where brands encourage people to buy for emotive reasons is that brands also need to counter consumers’ personal reasons not to buy. Some of these reasons may be legacy. Some may seem to be convenient self-interest. Others may look like they’re based on ignorance, bias, selfishness. They probably don’t make sense to you. That’s important because … actually, it’s not. It’s not important at all The problem that matters is not your opinion of why your buyer won’t buy – it’s the fact that they have this opinion, that it’s rational to them and they have every reason to keep thinking it until they don’t want to anymore. Chances are you won’t talk people into liking your brand. The most effective way to deal with an “unreasonable” objection is to counter with a riveting motive. Most people think that means price. But simply dropping your price is no silver bullet. It doesn’t make you a more likeable brand. It may make you a more attractive brand – in the short …

Customer service is worthless

By Mark Di Somma

We shouldn’t even think of “customer service” as being about something that is valuable to customers. The reasons are simple. We live in a service-focused age, and the people who buy from your brand know they’re customers. So “customer service” does not describe anything customers don’t expect and it certainly doesn’t envelope anything of particular value to them. Every brand is a service business at some level these days. In reality, customer service is the means to the real goal: sustained and profitable relationships forged between customers and a brand. Until you achieve that, you haven’t added any sense of worth for either party. You’ve just done what was expected. Success is not about achieving world-class customer service or carrier-level or benchmarks or any of the other abstract customer service qualitatives that are freely bandied about. Success pivots on whether your brand delivers experiences that your customers continue to be enchanted by. People don’t come back to a brand because they got good metrics. It’s sad then that some companies still think their job is …

Strategy: why the 2% is so critical

By Mark Di Somma

As part of making his case for why execution rules over strategy, and particularly why spending too much time on strategic thinking is a waste of time , Tom Peters features a quote from Al McDonald that unequivocally states the views of the former Managing Director of McKinsey & Co on strategic planning. “Never forget implementation, boys. In our work, it’s what I call the ‘last 98 percent’ of the client puzzle.” McDonald clearly intended this as an exhortation to focus on actions rather than wasting too much time on strategy. But I don’t read it that way. Instead, the critical point it seems to me is that the success or otherwise of nailing that huge 98 percent of the client puzzle is predicated on getting the first 2 percent, the strategic thinking, right. Based on McDonald’s own words, the return on investment from having the right strategy should in fact make the focus on strategic thinking a no-brainer. As Michael Porter observes: “There’s a fundamental distinction between strategy and operational effectiveness. Strategy is about …

Excitement vs risk: The very different emotions driving purchase of B2B and B2C brands

By Mark Di Somma

Philip Kotler once described brands as helping people to make decisions. In a world of frenzied competition and bewildering choice, they are of course the fastest, simplest and most effective way to link a name to a perception of value. What can easily be overlooked however is that B2B and B2C brands are not just about very different types of decisions but that they also involve very different types of decision making. For the most part, consumer brands look to influence an individual and/or groups of individuals (tribes). They are at their most powerful ‘in the moment’. They are about excitement through identification, and they are often strongly influenced by culture, taste, fashion and what’s important to people as people. B2B brands have different drivers – and the most important of these, I believe, is that no-one buys a B2B brand alone. Normally, there are multiple decision-makers involved, each with their own specific areas of responsibility and priority. There’s normally an elongated decision process (sometimes highly regimed) where final approval for go-ahead must pass set …