Gambling With Your Marketing

by Paul Travis, Interim Marketing Executive

This post has been bubbling in my head for some time, but 2 events today broke the camel’s back…

First was my colleague, Max Clough, mentioning a client potentially dragging out an opportunity to seize a market, because of the “national (and worldwide) poker game” that we’re experiencing.

Now on the one hand, I like that phraseology better than “The Economy”. As in, “we can’t make a decision because of The Economy.”

Let’s call a spade a spade. You’re afraid you don’t know what’s going to happen and you’re not confident that your business can survive.

Why?

Because you’ve been conditioned by the media for over half a year that the sky is falling! Now to be clear, I am not saying that there haven’t been huge increases in the jobless. I’m not saying that institutions Fannie Mae and Lehman Brothers aren’t failing and having huge repercussions.

What I’m saying is that people are still putting on their pants, and driving to work, and going to the movies, and.. and.. and..

* The movie industry is up 14%.
* Fast food companies are up.
* Low priced toys/games are booming.
* Almost anything “green” is selling.

Unfortunately telling the positive side of the story isn’t as lucrative as the fear cycle: it’s really bad so come back tomorrow and we’ll tell you how much worse it got!

Now before I go off the deep end, I know you’re wondering — what was the second event?

It was this SmartBrief: 73% of marketers predict more spending.

More than seven in 10 marketers hope to boost spending three to six months before the end of the downturn, while 16% said they would increase their budgets “as soon as it ends,” according to an online survey from the Association of National Advertisers. — Adweek (05/28)

What this means is that people are conserving cash, just like banks are. Too many are just playing the “timing” game, when to put the chips back on the table. Am I upset about the 16% who said that they would come back to the table when they could afford it?

No — I look at the 73% (almost five-fold!) who hope to play “time the market”, coming back “just in time”, before everyone else knows that the situation has gotten better.

If there is anything I hope we learn/remember from this, it is that the tortoise wins the race. Not the rabbit who wastes time chowing down, then runs fast, and then relaxes some more.

Plotting business strategy, developing process, and executing against plan is worth gold!

I was saying to my kids the other day, “there comes a point in growing up that you learn you can speak up and break with the crowd when they’re doing something you know is wrong”.

At the risk of over-repeating Steven Covey’s great line: “The environment you fashion out of your thoughts, your beliefs, your ideals, and your philosophy is the only climate you will ever live in.”

So think hard next time you catch yourself uttering a pessimistic remark… Let’s all be seeking to create success!

Paul Travis is an interim marketing executive and helps companies create a screaming value proposition and accelerate sales. He can be reached at paul.travis@oneaccordpartners.com. He also blogs at Marketing 2020.

The book, Leadership on Demand is available at http://leadership-on-demand.com/.

Photo by jamadams

Overcoming Pains Organizations Inflict on Themeselves

by Michael Pearce, Interim Management Executive

There are a host of pains organizations inflict on themselves that present clear and present dangers to their very viability. Among those we often see are:

• Goals and objectives that are out of sync with job descriptions and employee expectations

• Compensation plans that don’t reflect the will of the organizations executive leadership

• Management who believes it is their prerogative to manipulate sales compensation plans, changing quotas, territories and commission schedules mid-stream

• Sales automation/CRM systems that are installed to provide management reporting with sales productivity as a by product

• Few understand the complicated nature of channels, how to avoid conflict, and how to motivate organizations they don’t own, yet many businesses just can’t grow organically fast enough. Effective committed channels are a necessity.

So what can companies do?

• They must learn to hire for a season. Recognize that a significant percentage of employees will move on within a few years. Call it out confront it and embrace by designing the job description accordingly, and eliminate confusion and contention. Hire the very best for the tasks at hand. It’ll require a bit more thought and planning, but it’ll be worth it.

• Dedicate themselves to serving their employees and to making them successful; not managing them for compliance, rather leading them for significance; leading them rather than directing them

• Embrace technology. Many managers are digital immigrants leading digital natives. They resist it and demean it with comments like “I’ll never text”. We must immerse ourselves in it, admit our fears and frustrations, and join the ranks of the next generation who takes all this technology as a matter of fact and can’t understand why their management doesn’t.

• When we employ systems we must think first of the impact on the employee. Implement a CRM to make the sales people more productive, and have management reports as a byproduct. It’s the only way they will embrace it and the data will be accurate and timely.

• Hire scientifically. Success at a previous company is no guarantee of success with the next. It can no longer be acceptable to give an employee 9 months or longer to see if they will succeed. Thai’s as much as 1/3 of their tenure. They must be positioned to contribute much quicker.

• Build support tools like the company web site that personalize the web experience, allowing the inquirer to truly understand how your products and services can met his unique needs, and build it a way that leaves a thumb print behind so more and more can be turned into customers. It’s not the number of web hits that counts, it’s the number of customers that are generated.

• Have a mission statement that is meaningful, measure ideas against it, reward innovation, and create the opportunities that demand transformation versus incremental improvement.

• A soft economy can be the best time to gain market share. It’ll take a non-traditional approach, but embracing a win/win mentality, a servants heart for employees success, an acceptance that each employee really wants to make the best decisions possible, combined with an ability to accept effort and failure will help turn a business, even where the economy is having a negative impact, into a consistent winner.

Michael Pearce is an experienced interim management executive and has worked with several leading companies such as Citicorp, Boeing, Weyerhaeuser, Singer and EMC. His expertise is in building high performance sales teams and generating revenue and margins with repeatable, dependable, and predictable results. You can contact Mr. Pearce at michael.pearce@oneaccordpartners.com or at 425.830.4156. He also blogs at http://michael-pearce.blogspot.com/.

Photo by papalars

Interim Management Question: Will Decreased Consumer Spending Habits Last?

Will the recession lead to a lasting change in buyer behavior (in B2C) or will consumers revert back to old buying habits when the recession ends?

I think it will be all over the map. If you are an individual who prefers to buy a Pontiac, you will not have the choice of returning to your old buying habit. But this really isn’t the answer to the question, it only serves to demonstrate a point. The recession will change what options may be available and will certainly impact individuals perception of risk. Buzzwords such as value and frugality are currently in vogue. High end shoppers have most recently preferred that their newly purchased items be packaged in generic, no name bags. Along with an economic crisis there is a big spotlight on the condition of the environment. Living with less is being paralleled with a commitment of making less of an impact on the environment. There appears to be so much chaos occurring in the financial markets that a focus on individual financial fiscal management appears to be a focus for “not only” the more prudent/educated and knowledgeable types, but there appears to be a concerted effort on the part of the various government agencies to protect the less informed and uneducated populace. The surge of activity related to finding economically viable alternative energy will yield many new options for transportation and basic energy grid requirements. I don’t believe that we’ll go back to vehicles of the past just because we get pockets of reprieve from OPEC.

Bottom Line – Don’t rely on consumers to revert back to their old buying habits because by the time the option exist, they’ll probably forget what those “old” buying habits were. Will people start buying houses again, certainly. Will new house designs and sales strategies be different from where they were 18 months ago. You bet. Will consumers in conjunction with government watch dogs take a more conservative approach to credit card debt? I think so.

Max Clough
Interim Management Executive
seattle@oneaccordpartners.com

From an investment perspective… I hear deal makers speak as though the recession is episodic and therefore that we’ll revert to previous approaches to buying/selling companies.

The fundamentals got distorted the last 10 years and the norm going forward for consumers to business leaders alike will be to create and consume goods and services of value that produce tangible benefits.

Peter Klinge
Interim Management Executive
peter.klinge@oneaccordpartners.com
801.755.6820

Our basic economic order is built on a Keynsian Economic model – basically a “debt mentality”. As long as our economy has access to capital…it will spend. Yet, given the radical financial changes, a conservative approach will likely influence consumers, and more importantly businesses, for years to come. Ultimately – debt, yes, same old habits…not for a long time.

Jeff Rogers
Interim Management Executive
jeff.rogers@oneaccordpartners.com

This economic downturn is termed a “recession” but there are structural changes that make the “recession” different. There are some fundamental & dramatic shifts in banking practices (% equity to credit) that will change real estate and purchasing requiring loans. Also credit card companies are actually losing money due to non-payment so expect a tightening on credit applications, more discipline on payment dates & higher interest rates to offset non-payment losses. So bottom line as people go back to work & their disposable income recovers they will go back to previous low dollar consumer habits, but on higher dollar purchases requiring credit there are structural shifts in the credit providers that will ultimately restrict demand on goods and services permanently changing their habits. What we will not know for awhile is the degree of negative affect this structural shift will have.

Dale Hintz
Interim Management Executive
dale.hintz@oneaccordpartners.com
972-824-6923

Consumers have changed. They’ve been shocked by the reality of their situation – trees don’t grow through the sky…everything has a topping out and consumers now see that they are broke!

Consumption will be less conspicuous and savings will continue to grow as a percentage of GDP.

Jackson Weaver
Interim Management Executive
seattle@oneaccordpartners.com

Recessionary Consumer Behavior: Harvard Business School Video

Recessionary consumer behavior is discussed in this video with Professor John Quelch of Harvard Business School. He also talks about 4 types of consumers who are reacting in different ways to the economic environment, whether current consumer behaviors will become permanent, and whether you should invest in marketing during a recession.