Comment

When Consumers are Producers - Everyone Wins!

Have you ever seen one of these new Coca-Cola Freestyle machines?

Coca_Cola_Freestyle.jpg

I remember the first I saw something like this, I was a kid eating at a local Taco-Bell, it was awesome! After ordering your food, you would be given a cup and you were directed to pour your own soft drink. When nobody was looking I would mix and match different soft drinks to make the ultimate soda pop. It has me wondering why it’s more popular now.  Is it because, as consumers we want to interact with products more often?

In the recent past it was about speed and efficiency. But, is there a trend toward consumers becoming producers in the product cycle? And I don’t mean just in the soft drink realm. The above example is part a long line of successful products that have decided to engage in this type of business. Even a frozen yogurt retailer, Yogurty’s, allows customers to customize their order from start (cup size) to finish (types of sprinkles). In Yogurty’s process, the only time staff need to be involved is to collect payment! This severely reduces the overhead costs by putting the creation and design process in the hands of customers.

I’ve always loved making my own wine, picking fresh fruit at farms and just generally being closer to the creation of the products I consume. It just feels more fulfilling. To explain it better, this type of business is known as ‘biztainment’ and it has been around for a long time. Think about your first hay ride. Do you remember where it was? Most likely it was a farm. Do you remember what was also there? Was there a petting zoo perhaps? Were there games and food? Do you remember when it was open? Typically, these experiences have been offered through farms during the off season of crop production (and harvesting) it was a unique way for farms to connect with local customers, and provide some incremental revenue during the slower periods. The real driver for such activities were because farmers had all the elements right at their fingertips to begin with; tractors for tilling, animals like sheep, cows and pigs,  and plenty of hay for the animals. Eventually biztainment grew larger with rides, games and food vendors.

 From the Coca-Cola Freestlye machine, Yogurty’s, DIY wine/beer producers to your iconic hay ride, they all are a form of “Biztainment” – and according to some of the experts on the subject such as Mi Kyon Newsom, David A. Collier, Eric O. Olsen in their article Using Biztainment to gain competitive advantage (2009, published in Business Horizons, issue 52) is not only good business sense but a smart strategy in creating a competitive advantage.

The four key insights that Newsom, Collier and Olsen found is that 1) the evolution of the consumer has changed from this mass media focus, to more one-on-one customer oriented focus, 2) the interest that a consumer might find certain aspects of a business’ production as entertaining or fun, 3) the socioeconomic trend of transitioning from an agriculture, to industry, to service and finally information based economy. The final and arguably the most important insight is the 4) increased knowledge for biztainment to be an excellent source of revenue and customer acquisition.

One of the interesting tidbits of their article is the growth of production facilities to offer factory tours across the U.S. The website: http://factoryyourusa.com offers hundreds of opportunities for people to tour production facilities. Something that has always been believed to be necessary cost center, not a revenue generator!

There are many different types of biztainment. The first is agritainment –for example purposes, lets look at wineries.  It has not typically been related with the squishing of your own grapes, but it could. But for me it provides a wonderful setting for entertainment. It is interactive, social, fun and is transportive from ordinary daily life. You can let your curiosity fly by asking questions about blending, winemaking, harvesting, types of grapes and obviously  most importantly, sampling.

Beyond the above recent changes, some wineries in the Niagara escarpment (popular area for vineyards in Ontario), are doing more. They include fine dining, lodging, spas, bicycle rentals, guided tours and packages with popular attractions nearby (Niagara Falls). It’s not a hard decision providing additional services or opportunities such as a luxury spa. It keeps businesses alive in the winter months and will differentiate services from other local wineries. The more inclusive and interesting the agritainment can be, the better positioned the business or brand will be in the eyes of its customers and competitors.

We briefly explored how manufacturing facilities are being designed to be revenue generating businesses in addition to production facilities. This is known as manutainment. This is best expressed through the recent popularity of breweries, and particularly craft breweries. If you have been to the Alexander Keith’s Brewery in Halifax, you will recall how all your senses became alive.  At the end of the tour, you formed a connection with the company its products and the knowledge of how it’s made. This is meant to give the visitor a sense of loyalty because  you are guided through this well crafted story of production and heritage.

Retailtainment has grown over the years as well. Just consider William Sonoma. Whenever you walk into a store you are transported by the smells, comforting earthy colors and the guiding layout of the store. It takes you right into the center of the store where you are invited to sample food, to try unique  drinks and to touch open merchandise and browse cook books.  Service is non-invasive and very supportive. There aren’t any prowling sales reps. Items are laid throughout the store to be played with. Customers feel they are more than just shoppers. The consumer participates and obtains insight and information on the products. The experience is designed to flatter customers into becoming not just purchasers, but William Sonoma Customers.

The different types of biztainment can go on endlessly, and the number of successful examples are endless.  But the idea is still the same. The more a business is able to integrate its value chain into the customer’s sphere, the better the customer relates and develops a relationship with that business. Customers want to be consumers as much as they want to be producers. It’s a business philosophy that means more now than ever before.

Comment

Comment

Branding in Japan - This Retail Giant Leads With Authenticity

                                                          Source: Beams' Shinjuku shop; Source:  Beams.co.jp

                                                          Source: Beams' Shinjuku shop; Source: Beams.co.jp

Tokyo is best expressed through the exceptional attention to detail, design, presentation and experience in everything that's crafted, made or cooked. This is mind numbing considering that Tokyo has 13 million inhabitants. That being said, these fascinating yet admirable cultural parities from Western society also make it an interesting case study from a retail experience perspective. Consider Beams, a Japanese boutique clothing retailer, with over 151 stores in Japan and Asia with 13 in Hong Kong, Beijing, Shanghai, Tapei and most recently in Bangkok, Thailand. The stores are designed with a Japanese minimalist design touch, surrounded by open brick, dark woods and white open spaces. It's a very inviting, "homey" store, and as a customer you feel compelled to walk everywhere. It was started in 1976 (see CEOs note) and is managed by Yo Shitara. What makes this brand so unique is it's internal emphasis on brand authenticity. If you could sum up it's brand essence it would have to be Innovating Japanese lifestyle or arguably Empowering Japanese Lifestyle. But the key premise is the same, Beams strives to be part of the breakthrough culture and fashion retail business more so than anyone else. Surprisingly, Beams has made some interesting collaborations over the years with Western brands that are similar in stature (boutique retail fashion) - and it has only helped to reinforce what it sets out to do, not just domestically but internationally. But this brand identity is more than just the feel and style of the store, it its embedded right into the 1,300 employees.

The fashion department, known as the "Styling Advice Division" , is managed by two former buyers with years of experience in the fashion retail business. Their goal is to create trends that are unique, cool but also part of that Japanese traditional heritage (a sense of true Japanese authenticity), in a more younger, fresher perspective. To be one of the 1,300 employees at Beams, you are trained in a two week program in the subtleties of the presentation experience. How to properly wrap merchandise when purchased, and what bow to tie on top of the wrapped merchandise - even to the specifics of level of politeness of the bow (varying degrees, 15,30,45 - all signifying something different). The staff are required to wear two-of-three items from the Store (Legs, Torso and Feet - but suggested to wear all three items). But what the key ingredient here - is the styling that goes into the sales staff.

The sales staff not only wears Beams' clothes but they have the Beams' look. Regularly, hair stylists and makeup artists are brought in to help stylize sales staff more into their role. The premise is that if sales people look good, and represent what Beams' want to convey to the customer, the higher propensity the customer will buy (and buy more!). The style directors work closely with staff to create individual styles that allow customers to imagine themselves wearing it, and ultimately buy it. On top of this, there is a weekly competition of a "Good Styling Award" where each store competes through Flickr to be the best dressed sales associate (chosen by the two style directors). Sales staff not only compete for themselves but for the pride of their stores (yup, pride of their stores, only in Japan). This isn't all though, upon purchasing your gift the cashier will take your purchase, walk you to the door and hand you the bag while bowing. If it's raining they will double wrap your merchandise with water resistant material automatically.

What makes the Beams brand so successful, beside doing what they preach, creating authentic,  excellent customer experiences - is that they stay flexible. This flexibility and imbedded "autonomy" with sales staff allow stores to be more adaptable to different customers, different locations and different expectations. This philosophy of the business, puts the customer at the center. Creating value, over and over is the core driver for success. By being at the forefront, there isn't any time to be risk averse, just calculated, nimble and spontaneous.

This approach is a unique one, similar to what we saw with Supreme in that the emphasis on the brand is creating that sense of authenticity and truth. That to be a certain way, or to have a vision of your future, you need to be actively involved in attaining it. Saying you want to be #1 in a specific category is one thing, going out and aligning your internal culture and external environment is completely another.


Comment

1 Comment

supreme: built from the inside out

When Supreme first opened it's doors in downtown Manhattan way back over 20 years ago in 1994, it appealed instantly to a core group of "rebellious young New York skaters who became the store's staff, crew and customers" (supremenewyork.com)

And over the past 20 years, Supreme has evolved to be 9 stores in key markets around the globe, from Japan (6 stores with 3 in Tokyo), New York, Los Angeles and London (UK). What has really taken off with the Supreme brand is it's ability to stay reasonably priced throughout its infancy to aggressive growth (jeans have been steady at about $150 and hoodies at about $200). And considering this growth, it begs the question:

Is it still possible to be an authentic brand staying true to your roots while also being mindful about profits, growth and revenue?

In some ways it reminiscent of Red Bull in the early 2000s - rebellious, dangerous, exclusive - and it's reflective in the people who endorse the product. One of the key differentiators for Supreme is the chosen celebrity endorsements, for example at one point Tyler the Creator from Odd Future was selected (http://youtu.be/XSbZidsgMfw) to most recently and the reason to propagate this article, the legendary Neil Young (below).

Self-prophesied, Supreme states that it has three commitments: style, quality and authenticity. The key word that I think is reflective of what the brand itself represents to its end consumer is authenticity.

Style and quality are for sure critical, but are arguably the table stakes as a niche/specialized clothing retailer. But what does authenticity mean? For a brand like Supreme - absolutely everything.

What enabled Supreme to create such an aura of authenticity is its brand building - and I don't mean branding as external marketing/advertising - I mean through it's internal focus on key stakeholders. The business was created and managed by skaters, who were (and still are) young, stylish, entrepreneurs (aka filmmakers and musicians). These same people who ran the store weren't trained in the arts of urban clothing retail, they were the farthest thing from it. If someone walked in and rummaged through product and didn't talk-the-talk or walk-the-walk like a skater, they were pretty much (indirectly) escorted out of the store.

Point is, the store appealed to the exact same type of guy who worked there.

Supreme's branding is in it's culture and style, this authenticity transcends not just the colours and fabrics, but the imagery. And the celebrities who endorse Supreme are the personification of the evolution of the brand. When Supreme tapped into Tyler the Creator, that choice is speaking volumes about the brand on where it is and where it's going. By being hungry, different, young and fresh - represents what Supreme wanted to convey, and now today's brand message is more closely connecting with Neil Young, a renowned musician whose music is timeless and classic, and doesn't need any introductions regardless of social circles, just like Supreme.

If we remember in the 90s the success of another brand, Zoo York, the authenticity speaks to us not about delivering on the quality or style -but in delivering on a lifestyle. "I wear it so you know what I'm about" mentality. but the question ultimately arises, in a day where brands become identities,  where does this put Supreme? Like other "skater" oriented retailers like Vans, Huff, Stussy, or Hundreds to name a few that have already opened the flood gates to allow their product into more none traditional consumers. At least as of now, they haven't lost brand identity (and ultimately value). But the question reamains, how far can Supreme go to allow the brand to be diluted before it reaches that tipping point?

Well, I think they've done incredibly well thus far -and CEO and owner James Jebbia doesn't seem willing to jeopardize the brand image for anything. The key to any brand is to know your audience and to keep it authentic. The key to authenticity for Supreme is in people (employees, endorsements and customers), and the channels it sells its clothing, by controlling their retail channels (with some partnerships), and by engaging in limited runs, they can create enough new interest to grow their customer base but also keep their loyal customers loyal.

If you are happy making a product that people love, make good money that supports your life - what else do you want? The lesson by James jebbia is that success isn't defined how much money you can accrue, but how desired, loved and impressive your brand can be.

1 Comment

1 Comment

Maersk: Building Brand Identity Through Social Media

Recently, I was talking with a few small business owners, and I posed the question to them about their brand strategy. And they looked at me as if I had horns on my head! but maybe rightfully so. They enlightened me that they are in a commodity industry, but rigorously emphasized that each of them were successful because of their ability to manage customer relationships. By defining their industry as a commodity, it was an indication that they believed customers make their product choices based on price, and that their brand identity played no part in this purchase decision. When I asked why they thought their brand had no bearing, their response was that it was "unsexy, uninteresting and boring". But by emphasizing the focus on managing their customer relationships also suggests that there is truthfully more at stake than just this price-only decision theory. Customers are influenced by the company’s personality – at least at some level.

This also highlights how brand management takes place more so at the B2C level than at the B2B level, particularly with small and medium enterprises. I believe this occurs because of a stigma attached to brand management being more closely related to marketing communications and advertising then it is to creating brand personality or identity. And the associated perception of it being costly, time consuming and ineffective in a highly competitive industry.

In this article, we will explore a real life example of what one of the largest shipping companies in the world did to create a personality for an industry that was self-admittedly, boring. From this we will be able to see how such a framework could be used to small business owners to create a distinct voice in a marketplace filled with choices, competitors and opportunities.

Maersk-Line was founded in 1928 and is headquartered in Copenhagen, Denmark. With over 580 commercial transport vessels worldwide and 59,000 customers, shipping over 11 million containers annually- it is by far the largest commercial container transport company in the world. In the fourth quarter of 2011, Maersk began its foray into a new type of brand campaign with – drum roll – one person. The person in charge, and definitely a required recognition, was by a gentleman named Jonathan Wichmann. When he was first tasked to create and manage the social media presence for Maersk he was faced with such skepticism, not just externally, but internally. Just like our XYZ Cleaning Supplies Co. they believed their brand wasn’t meant to shared in such a personal way. It has traditionally been about marketing or more specifically, communicating Maersk’s pricing lists, destination, schedules and specific product details. Or more simply understood, to be an extension of their current marketing communication plan.

In developing a social media strategy for this new brand campaign – the emphasis was on: communications, customer service, sales (surprising!) and internal (employee) engagement. Wichmann based most of his strategy on what he knew about people, he knew that people are at the foundation of all businesses, and people will behave the same way in the end regardless of B2C or B2B markets. He knew Maersk’s customers wanted to interact with Maersk, simply because it’s part of the human need to want to interact with things in our circle, more than just a transactional experience.

The key to this strategy according to Wichmann, was to ensure that their branding could be flexible, and non-static, or preplanned. The key was to be able to have the flexibility to be spontaneous and authentic. To exercise the sole right to articulate a distinct, human voice (with professional overtones) for the Maersk brand.

From 2011 to 2013, Wichmann focused on building a presence across each social platform starting with Facebook. Facebook was naturally the first platform, since it was one that already began accruing members prior to the outlay of this new strategy. However, reflecting on this strategy starting with Facebook, it seems somewhat unusual. Initial impressions of such a campaign would be to start a digital branding campaign through other, more suitable platforms like Linkedin or a Blog. But again, the premise and overall goal of the strategy was to create a personality, or connect with customers in more of a personal way. Facebook, being a social network for people was the best avenue of creating this “personal Maersk story”.

When Wichmann found a hidden/lost digital archive of over 14,000 photographs of ships and ports – he began sharing them by posting them to Facebook, sometimes with little stories on the historical significance, or other relevant facts that would create some context with customers. These photos were posted to Facebook in different categories, some were dropped in categories like “vessels” (with dozens of photos at a time) and customers would comment, like and share them. While intermittently with these posts of pictures would be some specific marketing designated messages that would relate to Maersk’s quality service, rankings and awards attributed to specific business offerings and would reiterate how Maersk is there for your shipping needs.

The overall tone of the messages were professional in nature and clean – but still had a touch of personality. Some examples include: references to the movie Captain Phillips that was being shot on a Maersk ship or a story about a journey of unusual cargo like a giraffe being transported from port to port. Other more internal based photos would be of management in all types of settings, either on vessels, at a unique port or even at one of the many district offices.  

But the key to successful digital branding is to have real engagement with your customers. If you aren’t willing to allow customers to interact with your brand, then you really aren't engaging with them, and just communicating to them. For Maersk, in addition to posting interesting images of vessels, ports, management and unique stories they even solicited Facebook members to be active and provide their favourite images of a Maersk ship and then include them into albums, giving credit to the photographer. The benefit was that they allowed customers to interact with the brand on a more social level, creating an emotional connection that is arguably only reserved for the B2C market.

In late December 2011, some interesting facts came out of a poll initiated on Facebook. About 17% of followers were customers of Maersk, but surprisingly the largest percentage were just “fans” of Maersk – mostly defined as being shipping enthusiasts. This dynamic offered an element of opportunity, since there was a combination of current customers, potential future customers and people who might be in a situation to be a purchase influencer in the future.

In the first 11 months, over 400,000 new people “liked” the Maersk Facebook page. Many of these new likes were from employees as well. Considering that one of the four main objectives was to increase employee engagement, this branding strategy was extending beyond just the external environment of customers but into the inner workings of the business.

The employee body was made up of approximately 25,000 people, of which 7,000 were seafarers (Vessel captains, officers and crew). By increasing employee engagement on Facebook, it had opened up a new channel for fellow captains to connect with each other, as well as to family back home and indirectly created this sense of community within culture of Maersk. Additionally, this would also create a channel to gain new images and stories, since these 7,000 seafarers were at the forefront of bad weather, dangerous situations (eg. pirates) and beautiful skylines! This would create a whole new avenue of free and exciting content generation.

However, allowing your customers to be co-creators of your brand, carries certain risks (as McDonalds learned the hard way over the past few years). These risks can be negative publicity, angry customers or even plain old rumors. But these aren’t opportunities to ignore, they are just as important and valuable as the positive press. If something negative happens to your business, you must be ready to address it accordingly.

For example, On June 8, 2012, Maersk posted an article about a container ship striking a whale. Titled Maersk Norwich Whale Strike” (Highly recommend reading it). It discussed how these incidents could occur, what Maersk does to try and avoid these incidents and even had some emotional commentary about the great tragic loss of life and how it effects Maersk. The like to share ratio was 1:1 and they also engaged in a Q&A to help answer or clarify some questions customers (or people in general) might have.

Another example was on September 3, 2012 where Maersk posted an article the Clara Maersk who rescued 3,628 Vietnamese fugitives at sea, which included real archived footage from 1975 when the rescue occurred. These stories continued to give the brand an emotional experience with customers. They also helped generate great interest in the Maersk brand.

As Maersk expanded its digital/social brand identity across more platforms the strategy changed to create and add value to the overall personality. The way each platform changed messaging and the story it conveyed fit into a larger puzzle or storyline of the overall Maersk personality. I suggest doing a quick look at : Tumblr, Pinterest, Google+, Linkedin, Instagram, Flickr and twitter for the different messages being portrayed on each of those platforms by Maersk. Some were used more as employee engagement tools, by posting annual meeting videos, literature, some were more customer focused, some were editorial/media oriented. Each helping facilitate and reach different stakeholders with the brands overall message.

Some of the key results were pretty impressive – first the overall budget and cost for all this digital branding came to a total of $100,000 (includes employee time, publishing tool, Facebook ads to promote page and external vendor usage). At the end over 850,000 Facebook followers was achieved – and approximately 22% of this number was actual customers. The ROI is a big source of debate, but from a branding perspective, on which this campaign is really meant to achieve, succeeded.

Imagine the costs saved through other means of employee engagement (and the added benefit of creating the community feel), how about the reduced customer service fees/costs from using it to disseminate information to potential customers. And the overall awareness created in the marketplace. Today there are cumulatively over 2,000,000 Facebook followers for Maersk. If you think of all those people, with all their networks, professionally and personally. The total number of people familiar with the Maersk brand is easily past 10,000,000.

5 Key Takeaways:

  1. Don’t create or fabricate stories, but just tell the story of who you are – you’d be surprised how interesting that story actually is

  2. Focus on the end user, whatever you post – make sure it is actually valuable to them

  3. Be authentic with your brand, internally and externally – if you say something to your customers, you have to believe it completely internally (truthfully)

  4. Think about vision, what are you trying to accomplish? What is the WHY you are doing what you are doing, besides selling a product/service what are you hoping to be? The best XYZ Cleaning Supply Company in the world by offering the best cleaning and support solutions for a cleaner future? Be concise and direct

  5. Don’t worry about the ROI, think bigger picture – again what are you trying to articulate, who are you trying to articulate it to – what is the message that you want to convey about your brand

1 Comment

Comment

CUSTOMER EXPERIENCE DESIGN: WHAT IS IT?

            Psychology, sociology, economics, mathematics and statistics – these are several sciences used in traditional marketing. But today marketing is looked at holistically as an art with an in depth understanding of consumer behavior, usage of information systems and the exploration of one-on-one customer selling. But most interestingly and most underutilized is the emphasis across all types of marketing the importance of emotional design. This emotional design is the foundation for any successful product in today’s world.

           As Donald A. Norman articulated in his book Emotional Design: Why We love (or hate) Everyday Things (2007), there are three levels of design creation. The first level, and arguably the foundational level is the visceral component.

           The visceral is the initial impact of a product; the look, the touch and the feel. This component also creates that initial curiosity in the product, the “pre-consciousness”. Simply put, first impressions matter.

           The second level is the behavioral.  This component can be expanded to include the functionality, usability and performance of a product. Some marketers believe that this is the right of entry, since before you even discuss the third level, the behavioral component has to be well established. This is the experience customers have with using your product, is it positive or negative? Does it leave a lasting warm impression or cold? How easy is it to use? How functional is it? What activities does it support? This is the foundational level where traditionalists believe a product succeeds or fails.

          The third level, and the purpose of this article, is where both thoughts and emotions reside. This third level known as the reflective is highly influenced (or vulnerable) to cultural stimuli, type or level of education, life experiences and personal differences of individual people or groups. This level also can override the other two levels, since what some people find to be aesthetically appealing others will not, these differences are reflective in the way we experience the world. This reflective level can also be extended to the satisfaction of owning, displaying and using the product. This is the level where self-identity is created, through the relationship between oneself and the product. This level can also be viewed as a “mirror-window” brand that is a window to let people glimpse into a bit of who you are, and mirrors lasting emotional self-satisfaction. This is the level that great marketers excel at, and where good marketers fail. Some of the most successful brands (think Apple, Disney, Google, Nike and Rolex) have succinctly reached into our inner dreams and created products that inspire us with aspirations and hopes.

       As the Management Theorist Simon Sinek gleefully articulated, brands that tell you the WHY and not just the WHAT succeed the most. Instead of focusing on just attributes or buzz words, brands like Tesla appeal to our inner most desires by creating stories that deeply resonate with us. As Elon Musk embodies the Iron Man of automobiles, and the Tesla the ever so sought after the lost Ark, it drives us to be part of those stories, although we rationalize it to our close friends and family as being responsible or environmentally friendly, deep down the drive is to be part of something bigger than ourselves. To be both adventurous and daring while also responsible and reliable. 

       It’s also critical to note that the visceral and behavioural levels are about the “now”, they are based on your experience with using that product at any given moment, whereas the reflective level is influenced by a much longer timeline, including your past and your expected future, it includes the hidden unspoken level of unconsciousness that stretch beyond traditional attribute marketing, but speak to the little boy or girl inside each and every one of us.

Comment