There's no question the economy of the last several years has proved to be an especially formidable opponent. But the real fight we marketers are in is actually not against the economy. It's a battle with much bigger stakes: how to create an enduring brand that packs a competitive punch.
It's not a new battle. For decades marketers have decried that having to drive short-term sales and profit always seems to come at the expense of building a long-term brand. But never has the pressure to deliver on the short term been so great.
Some pundits even say building a brand for the long term is a thing of the past; an absurd, out-of-date 20th-century American ideal no longer possible given volatile markets and technology. You have to wonder if they're right when, in order to survive, major players such as Northwest Airlines, Maytag and Bear Stearns get acquired; when GM continues to bleed billions; when lowered consumer spending has knocked down many popular brands.
Yet despite the stats and pundits, some brands seem to find a way to endure. For example, between 1999 and 2001, Xerox saw its stock plummet 92%. Believing the company was doomed, no one wanted the CEO job except Anne Mulcahy, who refused to acknowledge defeat was inevitable. Her six-year turnaround is heralded by many as one of the greatest success stories in American corporate history. And from losses of more than $300 million in 2000, Ms. Mulcahy produced more than $1 billion in profits by 2007.
An impatient world
Ms. Mulcahy's example gives us our first insight on what it takes to win today despite the odds. Deep down you must see yourself as a fighter.
Given that experts say the marketplace is likely to remain volatile for years, is it still possible or even important to try to build a long-term brand? There seems to be little doubt: 97% of respondents to our May survey said yes. Ninety-seven percent said it's still a priority, and 80% predict that in five years building a brand's value will be seen as an even bigger priority than today. The rationale respondents cited is that branding is the only way a marketer can increase the odds of sustainable profitable growth, because branding is the only means to create something a customer will crave and trust all the more when the world around him is chaotic.
The brutal truth underlying the fight marketers are in today is this: The decision over who wins or loses at brand building no longer goes on and on for 15 to 20 years or more. The world has gotten very impatient. Consumers, dealers, distributors, analysts, professional investors, boards and bosses demand faster performance. Of those marketers we surveyed, 87% said the expectation for building brand equity was now 10 years or fewer, and 46% said it was now fewer than five years.
In fact, our whole culture is now demanding optimized value creation in about three to five years. And to whom does commerce turn to make this happen? Marketers, of course. Marketers must find a way to win regardless of the situation. So, we have no choice but to get our heads around the mentality it takes to fight and win.
To win in a world where even the long term is now short, fighters need agile, non-bureaucratic business models with people empowered to respond almost immediately to changing market conditions and opportunities.
Fighters will plan and strategize less on a yearly basis and more on a quarterly, monthly, weekly basis, tracking results and adjusting media and creative to reflect real time metrics -- which technology now makes possible.
|ABOUT THE AUTHOR|
Marsha Lindsay is CEO of Lindsay, Stone & Briggs, an ad agency specializing in jumpstarting brands using brand-based consumer insights in traditional and digital media.
Now the goal is to quickly boost the size of the customer base, and first-mover advantage will be critical to this. To steal share and penetrate new markets, fighters will launch more new products more quickly and prototype early, vetting ideas wherever feedback can be gathered almost instantaneously.
A brand's strength comes from a lot of loyal customers. But size and loyalty of a customer base are actually not a marketer's ultimate strength today. It's the creation of a loyal customer base that is very vocal on a brand's behalf.
A brand's most valuable customer is no longer the loyal one who purchases a lot and often; it's the one who may buy little but whose blog postings, online product reviews and favorable word of mouth influences others.
Engaged or not
This means the old marketing funnel, in which the goal was to achieve widespread awareness with the hopes of converting a few into customers, has been turned on its head. In today's world of clutter and choice, potential customers are either engaged or not. So marketers need to focus not just on increased agility, speed and strength but also engagement, which, as Forrester Research points out, is made up of four behavioral elements: involvement, interaction, intimacy and influence.
Engagement measures not just the quantity of time spent with your brand, but the quality of time spent. Quality, as in what are the most productive things a marketer can do that ultimately affects what a customer does at the moment of truth: buy or recommend a brand to others.
What this means is that engagement is the mentality needed to drive short-term marketing performance. And its metrics are also leading indicators of value creation for the long-term.
What's the best way to achieve engagement? Adopt the marketing mind-set of a retailer. I mean retailing in its broadest sense: a unique shopping situation selling goods directly to the individual or business that'll actually be using them.
Success only comes from thinking like a marketer -- developing a strategy to differentiate you from competitors in a way that is relevant to your target -- but then applying it with the speed of a retailer, launching with partial data and improving things based on real-world results.
All marketing is becoming more retail in nature because all marketers are on a stopwatch to quickly scale a consumer franchise. They can no longer afford being at the mercy of other channel partners who don't share their sense of marketing sophistication or urgency. So marketers are taking timing into their own hands, adopting retail strategies in an effort to gain some control over whatever it takes to engage end users and deliver to plan.
In the mania of today's volatile economy, the match you're in is to drive short-term performance while concurrently building brand value faster than ever before -- in as little as three to five years. The mentality this calls for is the mind-set of a retailer. So it should be no surprise that the moves that can help you increase the odds of being everlasting are those used by successful retailers in the real and virtual worlds to engage and scale a loyal customer base ASAP.
Research shows that your chances of winning are increased if your self-concept is that of a fighter. A belief deep down inside that with hard work and persistence you will find some way to endure. If this sounds like the storyline of every legendary boxing movie, you'll also recognize it as the story of Thomas Edison, Steve Jobs, Anne Mulcahy and others.
Given the fight we're in today, we have to follow the advice of Rocky Balboa's trainer, Mickey: Learn how to "eat lightning and crap thunder" by adopting a retail mind-set.