Posted on November 24, 2015March 19, 2018 by Mike Clayton

Seth Godin: Permission Marketing

The internet has changed the old pre-1990 world of marketing and advertising. It has thrown up new rules, new tools and new gurus. One of the very first to spot that this would happen, and then to study strategy and tactics, was Seth Godin. A serial entrepreneur and opinion former, Seth Godin is far better known among entrepreneurs, small business owners and freelancers than among the marketing managers of larger corporations. but he has worked hard to keep his analysis fresh and relevant, and there is much that any manager can learn from him.

Short Biography

Seth Godin was born, grew up and continues to live and work in New York State. Born in 1960, he read computer science and philosophy at Tufts University and then did an MBA in marketing at Stanford Graduate School of Business. He then went to work at educational software business, Spinnaker Software, as a brand manager.

He started his first business, in book packaging, after leaving Spinnaker in 1986, but real success came in 1995, when he and business partner Mark Hurst started a marketing company called Yoyodyne. Godin is an avid reader and Yoyodyne was possibly named after a fictional defence contractor in Thomas Pynchon’s novels.

Yoyodyne used the concept of ‘Permission Marketing’. This is a term Godin claims to have coined with his book of the same name, published in 1999. The idea behind this is that we, the targets of marketing, give our permission for the marketer to send us their messages. In the case of Yoyodyne, it gained permission on behalf of its clients, by offering their prospects games and contests. With a blue-chip customer base, Godin sold the business in 1998 to Yahoo!, becoming Yahoo!’s VP for Direct Marketing. He only stayed for two years, which suggests that this was a tie-in period, before setting out on his own again.

Multiple ventures have followed: ChangeThis (an idea dissemination platform – sold in 2005), Squidoo (a web microsite platform sold in 2014), The Domino Project (a book publishing venture that published one book per month in 2011 – four have been reprinted by Portfolio/Penguin in 2015).

In amongst this, Godin has been a prolific author and a successful speaker. He largely promotes his own events based on a massive following for his daily blog posts. This gives him a massive permission marketing base for his books, events, courses and any other venture he is drawn to.

Seven Big Ideas

We can track Godin’s ideas through his books (currently over 20, I think). Let’s take a look at a few that will appeal to a range of managers and professionals.

Permission Marketing (1999) and All Marketers are Liars (2004)

Don’t force your message on your audience – create a demand from your audience to hear your message. And then, when they come to you, don’t tell them about your product, tell them stories.

Purple Cow (2002)

The key is differentiation. Without it you won’t stand out and marketing will fail. You need to abandon product, place, price, and promotion in favour of p for phenomenal or, as Godin puts it: p for Purple Cow.

The Dip (2007)

Doing things really well is hard. You make a lot of progress at the start of your learning journey and then slow down. This is the Dip. If you take on too much, you won’t have the time or attention to escape the dip on anything. True success means quitting on most things so you can succeed on a few.

Tribes: We need you to lead us (2008)

Market by leading. Find like-minded people who believe in what you are doing and lead them. Create products or services that they want, and they will crave what you offer. The ultimate in permission marketing. See an earlier Pocketblog about Godin’s Tribes concept.

Linchpin: Are You Indispensable? (2010)

Market yourself by becoming essential to your organisation or your tribe. Do this with creativity and by doing the most valuable work that you can. This is a manifesto for personal success, rather than the success of your product.

We are all Weird (2011)

Everyone is different and the internet allows us to make for and market to the long tail – small communities who would have been too small to build a career or product on before the internet allowed us to address the world.

The Icarus Deception (2012)

Playing it safe is not a safe strategy. Success means taking risks and being exceptional. Be creative and do the best work you possibly can.

Seth Godin at TED

Seth Godin has spoken twice at TED, in 2003 and in 2009.

[ted id=28]

[ted id=538]

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Posted on December 9, 2014March 19, 2018 by Mike Clayton

Estée Lauder: Modern Marketing

Christmas is coming and many readers will be considering perfume and beauty products as gifts. One of the biggest players in that market is Estée Lauder – the eponymously named cosmetics business founded by a determined and charismatic entrepreneur: Estée Lauder.

Brief Biography

Estée Lauder was born in 1908 and grew up in the Queens suburb of New York, where her father (like mine) ran a hardware store. Her interest in beauty products started when her Hungarian uncle, Dr Schotz, who was a chemist, came to live with her family and created skin creams in the kitchen, and later in a laboratory in a stable out back. He also made paint stripper, embalming fluid, and lice treatment for chickens. We can only hope that there were no serious mix ups in packaging!

Lauder helped Schotz by selling beauty products and so began her career as a consummate salesperson and marketer, selling skin care and makeup in beauty salons, demonstrating her products on women while they were sitting under hair dryers. This cemented her belief that women must try if they are to buy.

The Estée Lauder name borrows from her given name, Josephine Esther Mentzer, which the family shortened to Esty, and her married name, following her marriage to Joseph Lauder in 1930 or, more strictly, I’d guess, following their remarriage in 1942, following separation and reconciliation. In 1946 she and Joseph Lauder launched the Company, soon winning a concession at their first department store.

Lauder targeted the most prestigious store, Saks, and a year later was able to finally persuade the buyer after giving a talk at the Waldorf Astoria hotel, and then giving away samples at the end. This created a demand that Saks could not ignore, and marked her second key lesson in marketing.

Lauder’s first fragrance was Youth Dew, a bath oil, created in 1953. It was a rapid success, and Lauder continued to demonstrate her olfactory acumen (as a ‘nose’ is how the industry terms it) by overseeing the creation of five more brands of fragrance before she retired in 1995.

Lauder’s Approach to Marketing

Many of Lauder’s marketing strategies and tactics will strike a modern reader as very… modern. They remain very much what is still recommended; because it still works. So, as a primer on marketing, we can do little better than take inventory of seven of her best approaches.

Give away samples

The try before you buy approach is so successful, it is used on a multi-million dollar scale. Just look at how many millions of versions of U2’s latest record were given away by Apple (500 million actually) at the launch of their new iOS8 and iPhone 6. Was this successful? You bet. Most of U2’s earlier albums re-entered the iTunes charts within a week, generating millions of dollars (undisclosed) of sales for both U2 and Apple.

Direct Mailing

Early on, Lauder used Sak’s mailing list to send samples and gifts to their customers, encouraging them to visit the Estée Lauder concession in store. Direct mailing may have fallen out of fashion to a degree, but many marketers still argue that, in the days of so much direct email, a well thought-out direct mail campaign can be successful. Whether you agree or not, the use of direct email is a powerful and omnipresent force in our lives – the same strategy; just new technology.

Clever Naming

When the US Food and Drug Administration came down hard on the scientific claims of Lauder’s rivals’ products, Lauder took an altogether more savvy route. Her advertising refrained from making scientific claims, but her naming implied the attributes she was unable to claim: Re-Nutriv is meaningless as a word, but caries a vast weight of associations.

Clever Pricing

‘You get what you pay for’ my dad used to say. If lots of her customers believed that, then her premium pricing strategy was clever. Without doubt, two things are true: she did insist on top-quality ingredients, but her pricing included a substantial mark-up, creating exclusivity and emphasising the quality through the most important real-estate in the store: the price label.

Gift with a purchase

That idea may well been hers – she certainly exploited it well, long before BOGOF and three-for-two offers made shopping bags twice as heavy.

Hands on Consultative Selling

Going one step beyond her ‘try-before-you-buy’ strategy, Lauder did pioneer in-store beauty consultations as a way of selling. She believed that in order to make a sale, you must touch the customer, and spent a great deal of her time advising customers and teaching Beauty Advisors.

Brand Clarity

Lauder believed that every woman had a right to feel beautiful and therefore ensure that her advertising portrayed beauty that was both aspirational and approachable. From 1962, Estée Lauder selected one model to be the “face” of the brand. These have included supermodels and actresses. Whether they are really ‘approachable’ is debatable, but at any one time, the face of the brand become a distinctive image for the company.

To learn more about marketing and sales…

This blog is for my mother, Jeanne Clayton, whose favourite perfume was Estée by Estée Lauder.

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Posted on March 15, 2011March 19, 2018 by Mike Clayton

Marketing is an Ethos

I think Neil Russell-Jones strikes the nail perfectly in his introduction to the Marketing Pocketbook:

‘Marketing is not a department or a group of people.It is an ethos, that is a type of thinking that must flow throughout an organisation and permeate every aspect of its operations.’

What he means is that we should not leave marketing to ‘the marketers’ and we should not consider it a distinct activity from any other aspect of running our business. Every aspect of every organisation from a multi-million-mega-corp to a sole-trader; and from the biggest Government department to the smallest cog in the Big Society machine needs to reflect the need to get a positive message out.

The game has changed: the rules are the same

The game of marketing has changed out of all recognition in the last ten years. The web and social media marketing channels have taken over and present us all with a huge amount to learn about how to use them effectively. Luckily, for the moment, the rules are the same – in the sense that they are defined by human psychology.

Continue reading Marketing is an Ethos

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Posted on May 3, 2022May 2, 2022 by Mike Clayton

Public Relations Primer

Pocketblog has gone back to basics. This is part of an extended management course.

Not every manager will need to get involved in public relations, or PR, but, from time-to-time, many will. So it is worth knowing and understanding the basics of one of the most important aspects of marketing.

What is PR?

The definition differs from one expert to another and the emphasis is very different on the two sides of the Atlantic. I personally prefer the simplicity of the definition offered by the Public Relations Society of America (PRSA) on their website:

‘Public relations is a strategic communication process that builds mutually beneficial relationships between organizations and their publics.’

The UK’s Chartered Institute of Public Relations (CIPR) places its emphasis on reputation, and defines PR as:

‘Public Relations is about reputation – the result of what you do, what you say and what others say about you.

‘Public Relations is the discipline which looks after reputation, with the aim of earning understanding and support and influencing opinion and behaviour. It is the planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics.’

For me, PR is about engaging with your public, so the concept of PR is relevant not just at the corporate level, but also at the level of individuals who want to strengthen their careers. The principal approaches to PR are:

Writing
Collaborating
Engaging the press and professional media
Engaging through social media
Direct engagement

We will take a short look at each.

Writing

Getting your message out by writing articles, blogs (like this one) and books has a very simple effect: it says ‘we know what we are talking about’. By offering your public practical or insightful content, you are enhancing your reputation and strengthening your relationships with your readers. It has traditionally been largely one-way, but with the advent of social media and bookmarking, the ability for your public to comment on your writing and engage in a dialogue about it has grown mightily. This can only be a good thing for you, if you have something valuable to say, and you say it well. Please comment below!

Collaborating

If you can collaborate with other, non-competing, organisations, you can extend the reach of your PR activities to encompass their public as well as your own. If you engage them effectively, they can become your public too. So the relationship you need with the ideal potential collaborator is one of overlapping interests, but not conflict. This is not to say that there are not some valuable collaborations to be made between competitors too, but the risks (and rewards) are substantially higher.

Engaging the Press and Professional Media

For some people, PR and issuing press releases amount to pretty much the same thing. Without a doubt, the press is continually hungry for engaging stories that will interest their audiences, so if you do this correctly, this is nothing more than an example of a good collaboration. But what the media can do is get your message out, bundled in a package of objectivity and professionalism that amplifies its effectiveness considerably. But don’t blow it: if you are asked to comment on camera, on the radio, or even in print: prepare well, because if you don’t, and you perform poorly, the media can turn your reputation into an overnight shambles.

Engaging through Social Media

With so many forms of social media around, even the so-called experts are struggling to offer coherent advice as to which to focus on and how to do it well. The two tips that seem to surface again and again from the best of them, and which make greatest sense to me, are:

Focus: choose one or two social media that your audience are most likely to engage with in numbers and in depth, and focus on using them well
Social: the nature of social media is that they enable social connections, so you need to be listening to conversations and engaging with them as you would in a bar, cafe or restaurant. If you just use them for announcements, then you are losing most of their value.

Direct Engagement

From meeting customers in the street, to sending them information by newsletter, direct engagement has the capacity to be the most powerful form of PR of all – and therefore the ability to do your reputation most harm as well as good. The difference between a helpful advice email, with some good offers, and a piece of unwanted junk is subtle. As with writing, above, direct engagement has to have WAM factor: ‘what about me?’ says your public.

You may like The Marketing Pocketbook. There are also some great resources on the PR profession websites:

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Posted on December 14, 2021December 13, 2021 by Mike Clayton

Mission, Vision and Values

Pocketblog has gone back to basics. This is part of an extended management course.

Among the most frequent sources of confusion for managers – at all levels – are the distinctions between mission, vision and values.

As I started planning this article, I created a table for myself, to put my ideas down about how they compare. In the end, I decided that, if a picture is worth a thousand words, a table must be worth at least 500.

You can click on this image to get a full screen version of this table.

There is not much more to say

Your mission is a long-term definition of why you are in business, your vision sets out what you want to achieve within your strategic planning timescale, and your values determine the culture, behaviours and choices you want your business and its people to follow.

Values should drive your culture through every process: recruitment, appraisal, promotion, succession, procurement, development, sales, marketing, …

Mission should set up the basis for your values. Mission and values should help you find which of many possible visions is right for your business.

Mission, vision and values: one of those things that is fiendishly simple in concept, yet staggeringly hard to do well.

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Posted on December 7, 2021December 6, 2021 by Mike Clayton

Business Strategy Tools

Pocketblog has gone back to basics. This is part of an extended management course.

Over the years, Pocketblog has covered some important business strategy thinkers, so we will start by reviewing what we have.

Good Strategy/Bad Strategy

This is the name of Richard Rumelt’s book and it neatly frames any discussion of business strategy by defining what your outcome needs to look like. Take a look at ‘What makes good business strategy?’

The Balanced Scorecard

In one of the all-time classic Harvard Business Review articles, Robert Kaplan and David Norton set out to ensure that our business strategies are balanced across a range of different areas of the business. The tool they introduced is nearly ubiquitous in the upper reaches of the management world, and no manager can get away without at least a passing familiarity with the Balanced Scorecard. Take a look at ’Balance is Everything’.

The McKinsey 7S Model

One of my own favourite tools is also about balance, but this time about ensuring all the elements of your business strategy and planning are all aligned. It was developed by consultants at top US firm, McKinsey: Tom Peters and Robert Waterman. The seven S model reminds us that shared values, style, skills, staff, structure, systems, and strategy must all be consistent with one another. Take a look at ‘On Competition: Internal Forces and the 7-S Model’.

The Awesome Michael Porter

Over the years, three blogs have featured the thinking of business strategy specialist, Michael Porter.

‘On Competition: Five Forces’ briefly introduced two of his principal ideas: the five forces model and his three generic business strategies that flow from them.

‘On Competition, again: Porter’s Five Forces’ took a deeper look at the five forces model.

‘On Competition – The Far End of the Value Chain’ focused on the three generic business strategies and his concept of the value chain. Here, I speculated that some businesses have found a fourth, very successful business strategy.

By the way, a recent entry in the Pocketblog Correspondence course returned to the idea of the value chain. Take a look at ‘The Value Chain’.

The Boston Consulting Group Matrix

Having finished reviewing the archives, let’s take a look at one business strategy tool. This is designed to help us answer a very simple question:

‘We have a number of products (or services) but limited resources to invest in their development and marketing. Which products (or services) should we focus our investment on?’

The folk at Boston Consulting Group who developed the tool suggested that two considerations are paramount in making our judgements:

What is our market share?
Do we have a dominant market position with this product/service, or a modest share. This dictates the base from which investment can grow or maintain our position.
What is the growth potential of the market?
Is this product in a growing, static or declining market? Clearly static and declining markets offer far less opportunity to recoup investments.

The result was a simple matrix that plots these two conditions against one-another and identifies four generic strategies. You can click on the image to enlarge it.

The Matrix gives us four strategies, three compelling labels for our products/services and one label that is, frankly, honest but lame.

Stars

Place your biggest investment bets on the products which dominate markets with high growth potential. If you are Samsung, you will be investing highly in mobile telephone products because the market continues to expand and you already have a dominant position.

Dogs

Do not invest – arguably, disinvest – in products which have a small share of a static or declining market. There is not much to win and you are not placed to take much of it.

Cash Cows

What do you do if you are a dominant player in a static or declining market? BCG suggested it is like having invested in a cow: you should look after it and milk it while it is healthy. This is how I read the men’s razor market. If you are one of the big players in your region (Gillette, Wilkinson Sword, Bic, for example, here in the UK), then you have a lot of investment in products and marketing, and a strong, valuable revenue stream. Over investment can gain little, as the market will never expand until men grow two heads or we need to shave more of ourselves. But if you don’t invest, you will lose the benefit of your position to your rivals. So, what do we see? Incremental investment in new – but hardly innovative – products. When I started shaving, two blades was new. Now we are up to five. By the time I no longer need to shave (about thirty years or so, I guess) I predict an eight bladed razor will be common.

Question Marks

What to call these pesky products… Does the label attach to the products or the challenge BCG found in labelling them with a cute title? Set aside that curious linguistic conundrum and we face the most difficult challenge of all. Your market is growing, so there is a big prize for the skilled/lucky investor. But your market position is weak, so you have a low chance of success against bigger rival products. Like many good tools, the BCG matrix does not give you all the answers. But it does bring your choices into stark relief.

From the Management Pocketbooks series:

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Posted on November 23, 2021November 22, 2021 by Mike Clayton

Process Map

Pocketblog has gone back to basics. This is part of an extended management course.

If you want to understand your value chain, with the intention of improving it, perhaps, you need first to be able to visualise it. You can do this by preparing a ‘process map’.

The purpose of this blog is to introduce you to two widely used methodologies for mapping out and illustrating processes.

The Role-Activity Diagram (RAD)

Role activity diagrams are based on three concepts:

The roles that people, teams or departments play in the process
The activities that players fulfil during the process
The interaction between one activity and another

The RAD below illustrates the process for a manager writing a marketing article on behalf of their organisation, for a trade journal. You can click on the image to see a larger version.

The symbols on the chart are explained below.

Roles include individuals, positions or posts, jobs, teams, departments, companies, organisations like regulators or unions, or a class of stakeholder like customers or residents. Activities tend to create change, like making, checking, briefing or selling. The interactions can be anything that involves two or more roles, such as moving materials or information, allocating or delegating work, authorising or agreeing a decision, or reporting status.

The IDEF Method

IDEF stands for ‘Integrated definition method for function modelling’. It presents processes as flow diagrams with activities as boxes, using a standard set of directions. The process flows from left to right with:

Inputs
… shown coming from the left
These can be materials, ideas, information or services that input into the process

Outputs
… shown coming out from the right
These can be information, services or products that are produced by the process

Controls
… shown applied from the top
These are the decisions and information that control the process

Mechanisms
… shown applied from below
This can be a person, team, system, service or supplier that performs or assists in the process

Strictly speaking, this is one of a family of IDEF modelling tools; IDEF0. You can learn more about IDEF1, IDEF1X, IDEF3, IDEF4 and IDEF5 at the IDEF website. These (and other) IDEF tools form a large family (Wikipedia lists 15) of systems and software modelling languages.

IDEF0, however, is very suitable of modelling organisational processes and has the merit that it can translate well into setting out a functional requirement for a system development.

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Posted on March 18, 2021March 17, 2021 by Mike Clayton

The Three Powers of Persuasion

Pocketblog has gone back to basics. This is part of an extended management course.

Can it really be true that, as a modern manager, you need to know your Aristotle?

Well, one part of it; yes.

For Aristotle, the power of logic was supreme, but he realised that we can often be right, we can know we are right, we can make our point clearly, and yet we can still fail to persuade. So he identified the three things that need to work together, to build a persuasive argument:

Ethos – or character
Logos – or reason
Pathos – or emotion

Exercise: Building a Persuasive Argument

Think of an argument you need to make. It might be to your boss, your customer, your supplier, your marketing, sales or production department, or to anyone. Let’s use Aristotle’s three persuaders to build your own persuasive argument, and let’s suppose you first want to persuade me.

Step 1: Ethos

Your first step must be to establish why I should listen to you in the first place.

What experience do you have that is relevant?
What credentials make you credible in this area?
Why should I believe and trust you?
Who would vouch for you?
How will you build my respect with everything you say?

Step 2: Logos

Next you need to build a logical argument that contains compelling reasons why I should agree with what you are saying. The two components of a logical argument are;

Hard evidence
Robust analysis

So start with the first. What evidence, facts or data can you bring to bear? Examine each carefully for flaws and retain only the strongest evidence. Aim for a maximum of three powerful bases for your argument. Having too many arguments dilutes each one, creating a paradoxical weakening of your case, rather than strengthening it.

What evidence is your strongest?
Write down all the evidence you have and then review each part to find the basis for your strongest case.

Now develop your case by interpreting the evidence to make your points. Your logos will be strongest when you take care to make your analytical process as rigorous as you can, so take care not to fudge or miss a step as you work from the facts to your conclusions.

Build your arguments now, by creating a logical flow of reasoning from your evidence to the conclusion you want me to accept.

Step 3: Pathos

Whatever delusions we may hold about the rigour of our own thought processes, most of the decisions we make are made by instinct, intuition and emotional response. Only after we have made them, do we set out to justify them rationally, by selecting evidence and an interpretation to suit.

So a purely rational approach to persuasion will often fail. You need also to appeal to my feelings and intuitions and that is the purpose of pathos. You can use pathos bluntly by yanking on my heartstrings, or powerfully by choosing to tell a compelling story. This way, the emotion is amplified yet not so evident.

What story can you tell, to weave your evidence and logic into a compelling narrative? How can you tweak this to make it easy for me to identify myself in your story and feel a real part of it? How can your ending demonstrate the positive impact of my choosing to agree with you?

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Posted on September 29, 2020August 26, 2020 by Mike Clayton

Customer Journey: Mapping your Relationship

You can’t understand someone until you’ve walked a mile in their shoes. That’s the principle behind mapping out your customer journey. It’s a way to get an insight into how it feels for your customers to deal with you at each step along the path.

And since understanding your customer is vital to making them feel good about buying and using your product, customer journey mapping is a valuable tool to support this Big Idea.

Continue reading Customer Journey: Mapping your Relationship

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Posted on September 15, 2020August 26, 2020 by Mike Clayton

Sunk Cost and the Sunk Cost Fallacy

‘You’ve bought it now. The money’s gone.’ That snarky comment made by thousands of parents (mine included) to their reckless child encapsulates the meaning of sunk cost. Once you met the cost, it’s gone: sunk. You’ve sunk it into the investment for good or for ill.

This, then, could be the shortest Big Ideas article yet. Sunk Cost is a familiar and easy concept.

Continue reading Sunk Cost and the Sunk Cost Fallacy

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