Consumer Behavior Changes due to Technology.

Are there some "behavioral ecosystems" (driven by technology, or otherwise) and "contexts" that are simply "better" for human behavior? Are there "contexts" that "stretch" human behavior?

Executive Summary: A quick three pronged approach- a question to start us thinking about the impact technology has on the world we live in, a thought experiment to help us think through this impact, and then some quick thoughts as a check, and as an inflamatory contrast, to throw our own thinking in sharp relief. From the desk of Three-Pointers-Aren't-Just-All-Basketball.

The Question

A conversation with some bright digital media folks bubbled up this question: how has technology changed consumer behavior?

To each of us, the answer may be obvious, however, it is well worth stepping back and taking a moment to think through this as an exercise. This helps us become more aware of technology's impact on consumer behavior.

A Thought Experiment

Here is a visualization thought experiment, with apologies to the GEICO Caveman- The Neanderthal cave paintings were a "Gossip Girl" of the age.

Some Quick Answers

A wise, experienced response:
Within the framework of behavior in a country, nothing much has really changed. The context? As far back as the 80's and across the pond, folks were leveraging consumer analytics to sell financial products (Hats off, Ritesh).

Another view: Technology impact consumer behavior by 

1. aggregating numerous individual decisions,
2. making consumers aware of these aggregations, and,
3. allowing game theory to have a field day via exchange of, or lack of exchange of, information.

The underlying theme across these points is the development of markets- either intra or inter country- and the development of context for human behavior.

I know, your first reaction here would be- do you really think Facebook, Twitter, and Groupon have not changed how we live? Sure, they have helped "cultures"/ "markets" evolve, by changing their context. However, have these forces of technology changed fundamental human behavior?

The Twist in The Tale

This leads a different line of thought:

1. How is technology changing the context we live in?
2. How does human behavior adapt to changed context?
3. Are there really new contexts that have not existed before?
4. Are there some contexts that are simply "better ecosystems" for human behavior than others?

What do you think?

Netflix and Organizational Capabilities

Executive Summary: While I previously shared a thought exercise (link) on the kind of capabilities Netflix can demonstrate against its competition, this post is about the hard work that goes into creating an organization where teams work in concert, and in diverse ways, to develop these competitive capabilities. From the Desk-of-George-Lucas-Theory-When-In-Doubt-Make-Star-Wars-Prequels.

Why am I talking about Netflix?

Three reasons.

1. Innovation:
Netflix has been called an innovator that leverages its investments into innovation effectively towards business capabilities.

2. Market Capabilities:
Recently, there was news about Netflix looking at original programming, that kicked off this thought exercise on innovation and tactics below:
http://randomjunkyramblings.blogspot.com/2011/03/innovation-and-tactics-series-netflix.html

3. Distinct Context:
Unlike the iPhone, Netflix has entered existing markets and upended them without much "confetti about cool". It's almost like a B2B company in a B2C market.

What does Netflix mean for Other Organizations?

Netflix continued to invest in streaming capability for many years, before launching the product. This demonstrates a long term thinking about its business and its markets.

How does an organization connect
a. investing in long term capabilities, and,
b. thinking about markets,
In hindsight, all of this is as easy as pie. Lets look at the challenges.

Challenges with Making the Organizational Connections:

Let's take two cases within two functions in an organization.

1. Finance:
Say you are a business finance manager, and a business manager comes over to you about a prototype he would like to acquire and integrate into the company's product and marketing portfolio. How do you not only help him acquire the prototype, but also give him the leeway to invest time and resources toward patiently integrating an early stage startup product into a reliable portfolio asset at the company?

2. Marketing:
As a marketing manager, say, you realize you need an organization wide communication and analytics sharing capability to meet the product and competitive environment in the medium term. What kind of marketing programs, and in what prioritized order, do you push, to deliver phased, sustained capabilities to your organization over the medium term?

Suddenly, this doesn't look all that easy, does it?

For managers battling to get things done within their silos on a daily basis, these are not easy questions to answer. Thinking about this gives you the scale of the effort that an organization needs to put into developing capabilities that impact its markets.

What do you think?

Innovation and Tactics Series: iPad2 and iPhone Nano?

Executive Summary: Sometimes, the simplest things can be lost in the daily tactical maze. There have been a slew of statistics demonstrating that Android phones have been eating Apple's lunch over growth in marketshare. If you were Apple, how would you react to these market developments? With its product pipeline and brand dexterity, does Apple really care? From the Desk of Beatles-Were-Wise-With-Live-And-Let-Die.

... More: Think a simple 2x2 matrix covering- market penetration via existing and new products, adjacent market development via new and existing products, and entirely new markets via new products.

The Statistic

Google’s Android becomes the world’s leading smart phone platform:
http://www.canalys.com/pr/2011/r2011013.html

So, there have been rumors swirling about the iPhone nano:
1. Rumors of an iPhone Nano Continue: Smaller, Cheaper, No Memory?
http://onespot.wsj.com/technology/2011/02/14/351ce/rumors-of-an-iphone-nano-continue-smalle

2. Opportunities & Challenges Galore for Apple with 'iPhone Nano':
http://blogs.strategyanalytics.com/WDS/post/2011/02/16/Opportunities-Challenges-Galore-for-Apple-with-iPhone-Nano.aspx

Could they be true? What should AAPL be doing?

The Structure Around The Idea

Here are some steps to aid the thinking process:
1. Current Product for an Existing Marketing- iPhones:
Apple smartly squeezed all it could through its relationship with ATT. Now, to seek increased market penetration, it partnered with Verizon. iPhones are still positioned as products that are a "cut above the rest", and continue to generate great margins for Apple.

The feature pipeline for the current iPhone product line is strong and Apple can expect to continue to dominate the market.

2. New Product for a New Market- iPads:
Apple at the netbook's lunch. No other product is near the customer's utility curve (read conjoint analysis). With the iPad2, Apple widens the gap with competitor products, and safeguards its margins. However, would we say that the Android's smartphone market is a "new" market for Apple? Perhaps it needs a "new" product for this "new" market?

3.  New Products for Existing Markets: 
Really? See point 1. Even better, Apple's strong brand and positioning with its existing product line is so much "gold" that it can practically launch what were traditionally new products under the guise of extensions of existing products.

4. Existing Products for New Markets:
Make no mistake, the iPhone nano is a *new* product in the product development sense. However, in terms of messaging, the iPhone nano is brilliant in leveraging the consumer connection and premium positioning with the "nano" and pit it against "fancy-scmancy" andriod phones.

The Bottom Line

Now, the questions that remain:
1. Internal Assessment: Do Apple's current financial position vis a vis its margins, and its future product margins trends, demand the iPhone nano launch?
2. Competitive Assessment: What does the iPhone Nano launch do its competitors? You can't expect them to shrivel up and disappear. :-)

Stay tooned.
What do you think?

Apple iPad : A Profile of a Technology Influencer / Opinion Leader / Early Adopter.

There are studies about shopping behaviour and there are studies. Then, there are Confessions of a Technology Shopaholic.

As a self-confessed gadget freak, I can see that the link below- a Technology Influencer / Opinion Leader / Early Adopter spilling the beans on a purchase- falls in the latter category:
http://shopping.yahoo.com/articles/yshoppingarticles/358/how-my-499-ipad-purchase-became-a-1170-credit-card-bill/

If you can't wait to hit the Apple store to see a decade long buzz on convergence and ubiquitous computing take a step closer to reality thanks to great productization and marketing, join the line. :-)

What do you think?
 
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Organization (Re)Alignment and 360 Degree Messaging.

Executive Summary: Tools to tackle the "softer" aspects of organizational (re)alignment- backed by analytics, like the Identity Circle, in a previous post- need to be prioritized when organizational initiatives are planned. Purely as a current example, snippets from the global discussion on Toyota's response to its car performance crisis provide you the starting point to think about, and build, the tools to weigh your options more effectively.


The Crisis
Toyota is facing a massive car performance crisis. It has needed various parts of its ecosystem, which includes car dealers, sales, marketing, PR, operations, finance and suppliers, to move in a concerted manner across various channels to tackle it. The crisis has the potential to impact the industry as a whole. Yes, that's where the term 360 degree messaging comes in. It implies both external and external messaging.


The Conversation
Below is a snippet from the global discussion about Toyota's crisis that shed light on the response to the crisis:
1. Accelerating towards crisis: a PR view of Toyota's recall
http://www.guardian.co.uk/business/2010/feb/09/pr-view-toyota-reputation-management

As you would have noted, this article talks about crises that companies like Mattel and Cadburys have tackled previously. Toyota's crisis happens to be a current example in a continuum. The conclusion? A brand/ PR crisis is not an "unthinkable". It may be a Black Swan, but it needs to be explicitly considered.

Organizational (Re)Alignment?
How does the organization and/ or its ecosystem tie into a crisis response? Lets look at some questions that help us evaluate this.

* Are crisis response issues worth minimizing in advance? Do they deserve upfront planning and resources?
* Are crises response issues black swans?
* Is response to a crisis purely an external messaging issue? Is it a leadership issue? Is it an across-the-board organization/ ecosystem issue?
* Would tools that effectively (re)align organizations have helped Toyota or other organizations in crisis?
* Would the results of implementing such tools have helped response?
* Which tools are more effective at providing leadership, or the overall organization, levers to deploy an effective response?
* What tools are available?
* What are the pros and cons of each?
* How effective are each of these tools?



What do you think?



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Entrepreneur's Corner: Baked by Melissa, Bite-Size Treats!

Executive Summary: We look at an entrepreneurial venture, Baked by Melissa, and some things that stand out with this cupcake shop- product size, pricing and a range of product flavors.

The Overview
Walking about in Manhattan, two signs of green shoots caught my attention. Here is "Baked by Melissa".

The "Baked by Melissa" store's hole in the wall look belies all the work that seems to have gone on behind it- they already seem to have a following, and also run a catering operation. I discovered in when I saw a long line in SOHO, almost as long as the ones formed by fans outside the Abercrombie store on 5th Ave., leading up to a little window.

The cupcakes are bitesized, for a dollar each, and you pick a minimum of 3 from the shop. I was only too glad to sample 3 different flavors at one go. I can see cupcake fans going in for volume when they visit the store.

How Do You Find It?
http://www.bakedbymelissa.com/

Green Shoots?
Melissa Bushell started this venture after moving on from her last job. Talk about green shoots! Here's a candid (third party) interview:
http://cupcakestakethecake.blogspot.com/2009/04/cupcake-interview-melissa-bushell-of.html

It's a great insight into "Animal Spirits".

The Deal- The Marketing Strategy
Why would I talk about this startup?
Note: These perspectives are all mine and have not been discussed with Baked by Melissa.
* The Product: Interesting mix of standard and innovative cupcakes. Did I say that I see cupcake fans buying cupcakes in "box sizes"? I can also see a bite-size cupcake going up against mini/ regular/ large cupcakes with a message- "lose the calories, but not the taste".
* Product Size and Pricing: Did I mention that the cupcakes are bite-sized, for a dollar each, and you pick a minimum of 3 from the shop? This strategy confers great flexibility on the margins.
* Positioning- While the messaging theme (see website) is simple and correctly centered around taste, it could also subtly play into a health and fitness savvy dessert-fiend profile.
* Merchandising- none noted at the store. A simple, "back to the basics of taste" operation.

Ahem... Constructive Criticism?
None. The idea here is to understand "green shoots" and "animal spirits". The entrepreneurs ostensibly have the right counsel to survive growth pangs.


What do you think? Ready, Steady, Cupcake?

 
 
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Entrepreneur's Corner: Organicoa, for Hot Cocoa!

Executive Summary: We look at an entrepreneurial venture, Organicoa, and some things that stand out with this cocoa shop- product taste and size, and positioning.

The Overview
Walking about in Manhattan, two signs of green shoots caught my attention. Here is Organicoa.

Organicoa is a cocoa shop (currently) at Lafayette St. in SOHO. The makeshift ping pong table instantly caught my attention- just the excuse you need to walk into the shop for some hot cocoa in the colder than usual weather. The leadership team happened to be around, was very warm to talk with, and was enthusiastic about sharing the organic theme behind the products and the merchandise.

The cocoa brought back memories of some great cocoa I enjoyed over a decade ago. One product comes close to the Organicoa taste- Milo. Yes, the Aussie drink.

The shop had small, bite sized cookies to go with the hot cocoa. Also, you don't have to buy hot coca to play ping-pong. :-)

How Do You Find It?
The facebook page: http://www.facebook.com/pages/organicoa/315291760276?v=info

Green Shoots?
A great product and an enthusiastic team. The team had taken over unused store space while the real estate firm looked to find a leasee for the the space. They aren't waiting around to make their venture happen.

The Deal- The Marketing Strategy
Why would I talk about this startup?
Note: These perspectives are all mine and have not been discussed with Organicoa.
* Great product- It reminded me of some great cocoa I have had previously.
* Bite-size cookies- complement the cocoa. The size also gives you leverage to manage pricing and margins.
* Cup sizes- I saw a single cup size. The current "pilot" (my adjective) location gives them some time to test out price points.
* Store ambience- The large, bare store space still managed to ooze a warm, "lets hang out" ambience.
* Positioning- Yes, Organic is healthy is a core message. However, who would have thought about throwing in a makeshift poing pong table on the large store space? Tied to the ambience, "community" comes to mind.
* Theme is core to merchandising- from the colors to the organic content of the merchandise, the team has closed the loop on the message.

Ahem... Constructive Criticism?
None. The idea here is to understand "green shoots" and "animal spirits". The entrepreneurs ostensibly have the right counsel to survive growth pangs.


What do you think?

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Coming Next on Entrepreneurs Corner: Baked by Melissa- mini cupcakes as Bite-size Desserts?:
http://randomjunkyramblings.blogspot.com/2010/01/entrepreneurs-corner-baked-by-melissa.html

Data, Privacy and Social Media: Impact on Analytics and Tools

Executive Summary: How does data, along with the constraints on it, impact web analytics tools and the industry? How do you start structuring your thoughts about data's role in this industry?
Note: This came about after some rumination on the way the web and social media are being used by businesses, and this post has been updated with some of those thoughts to help continuity.

My last couple posts have been threatening to run down this alley for a while, but I realized that Data, Privacy and Social Media need to be addressed together in a separate post. I shared these thoughts with Alan Chapell, Chapell & Associates, after a chance meeting with him at an event before the Affiliate Marketing Summit.

Do Privacy Issues Impact Data Access for Analysis?
Yes, especially when you are not the primary service provider.

When you think about Data, Privacy and Social Media in the same breath, issues like those that Facebook has recently faced come to mind:
1> The criticism:
http://consumerist.com/5150175/facebooks-new-terms-of-service-we-can-do-anything-we-want-with-your-content-forever
2> The response:
http://blog.facebook.com/blog.php?post=54434097130

It is important to note that this recent case is part of a continuum of controversies over access to and sharing of online customer information during the past decade.

Data privacy is just one of the factors impacting the web analytics industry. Hence, to assess the impact of data related privacy issues on web analytics for social media, you need to drill down for insights in the following manner:

Drill Down Level 1: Analytics, Market Structure and Client Trends
1> State of the Art in Analytics.
2> Client Requirements.
3> Market Structure.

Drill Down level 2: Client Needs and Impact of Data
Insights from areas 1, 2 and 3 above will help you create a picture of:
1> Industry Objectives: Met and Unmet
These are objectives that the web analytics industry can currently help its clients meet. E.g. What metrics can be measured, and how do they translate into impact for the client?

2> Data Access and Usage: Reality, Needs, Gaps
This is role data currently plays, and can play, in the industry. E.g. What data, out of the available data sources, is currently utilized, how is it utilized, and how can it be utilized?

Drill Down Level 3: Data Privacy Constraints
Once we have this level of analysis, we can gain an insight into the impact of current privacy constraints on the industry. Importantly, we also can overlay various combinations of data privacy constraints to get an insight into the role data privacy can play in the industry.

Drill Down Level 1: Below are some questions that help us get insights:
1. State of the Analytics Art: What is the level of skill and tool maturity of social media companies in terms of tracking social networks, and allowing ad targeting around them? Some additional evaluative questions can be found at my previous post below:
http://randomjunkyramblings.blogspot.com/2009/08/ads-applying-web-analytics-tools.html

2. Comparing Traditional and Social Media Analytics:
An alternative to consumer targeting via social network analysis is targeting via demographic and psychographic analysis. Here companies like Nielsen have developed a set of consumer personality profiles. Are social media sites developing such profiles?

3. Third Party Analytics:
How do third party analytics compare with the State of the Analytics Art? Specifically, (in terms of providing social network access to third party providers for analytics) are social media companies taking an API and metrics sharing or a raw data sharing approach? This impacts the competitive environment in the analytics industry.

4. Client Needs:
What are clients doing in the web and social media space? What are the client objectives in this space? Are they looking at demand generation or demand fulfilment? What would they like to/ need to measure?

5. Market Structure (and Opportunity!): Who are the major players? Is the market fragmented? Are there alliances in this market? How strong are service provider- client relationships? Do analysis, metrics, or data clearinghouses exist?

The opportunity!: Is there a market for "clearinghouses" for analytics that would provide media buyers access to social media consumer data across platforms? In reality, a "clearinghouse" is not easy to achieve- E.g. In the brick-and-mortar retail world, Walmart does not share its scanner data.

The Background
How did I arrive at this post? My last couple of posts have been pointing toward looking at Data, Analytics and Social Networks through the privacy lens:
1. Data, Privacy and Customized Brand Metrics:
http://randomjunkyramblings.blogspot.com/2009/08/sustaining-brand-conversation-behavior.html
How do you deal with a profusion of metrics which often have an unclear context? We need metrics with clear semantics. Some of these metrics may be custom created for a specific brand, consumer profile, activity and social media context.
Future Shock
While generic, industry standard metrics are important, there is a huge *future* potential for metrics customized to the brand. These will hinge on the data collection capabilities of social media platforms, and their ability to share it in a cheap, safe, anonymized manner with third parties for further analysis. Additional factors that come into play- quality of data, privacy concerns and analytics capabilities.

2. Data, Privacy and Web Analytics Tools:
http://randomjunkyramblings.blogspot.com/2009/08/ads-applying-web-analytics-tools.html
3. Can you utilize the social network based targeting tools in conjunction with non social network based predictive analysis tools to minimize errors or optimize marketing spend?
Don't Forget Data: The Root of All Analytics
While it is easy to get lost in the tools and their trade-offs, don't forget the data. Your data- what attributes are available, access, usability and quality- may dictate the choice of tools.

What do you think?


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Sustaining a Brand Conversation: Behavior Tracking and Measurements Notes for Brand Marketers

Executive Summary: How do you deal with a profusion of social media metrics which often have an unclear context? We need metrics with clear semantics. Some of these metrics may be custom created for a specific brand, consumer profile, activity and social media context. We could create two categories of metrics- generic, infrastructure metrics of the type that are commonly thrown about and need contextual understanding, and functional metrics that have clear semantics attached.

The Story So Far
We covered a need for strategic thought behind social media marketing investments below:http://randomjunkyramblings.blogspot.com/2009/07/to-strategize-or-not-to-strategize.html

The next step is to generate a picture or customer touchpoints/ interactions with the brand across various channels. Besides qualitative insights, you would like concrete measures that support these insights.

There are challenges in tying in consumer behavior in a "regular" distribution channel with that across social media channels. Leveraging your existing, real world consumer profiles in the social media world is a separate theme. Our focus in this post is to find ways to measure and track consumer behavior in the social media channels.

Challenges with Interactive Metrics Today
There are two challenges with social media metrics today:
1> A profusion of metrics.
2> A need to understand the context in which these metrics are being generated.

David Berkowitz has a great post here on the various metrics available to marketers today, and a proposed Cost Per Social Action (CPSA) metric:http://www.marketersstudio.com/2009/08/cpsa-cost-per-social-action-the-new-pricing-model-for-social-media.htmlThere are third party companies like Visible Measures doing interesting work as well.

As for context, a wise man once said, context is everything. Does a metric mean the same coming from a face to face interaction as opposed to one over twitter, or even one from a different social media platform?

A Potential Solution
Some new metrics are needed. However, they need to be functional in nature. By functional- I mean that the metrics need to carry a consistent meaning for brand marketers. CPM clicks could be meaningless in some contexts. You might argue that this is true of all metrics. True. Hence the need for metrics with specific meaning and context attached to them.

I am not saying this is the end of the existing metrics. We could have two classes of metrics- the infrastructure metrics and the functional metrics. All metrics have semantics, hence I am calling these new metrics "functional" metrics, instead of calling them semantic metrics.

Future Shock
There lies the key. While generic, industry standard metrics are important, there is a huge *future* potential for metrics customized to the brand. These will hinge on the data collection capabilities of social media platforms, and their ability to share it in a cheap, safe, anonymized manner with third parties for further analysis. Additional factors that come into play- quality of data, privacy concerns and analytics capabilities.

What Can We Do Now?
While it is great to theorize about the future, there is opportunity today to develop measures that make sense for a specific brand, consumer profile, activity and social media context.
You are welcome to contact me for a conversation on these.

Update 1 (Thanks to David's followup): Functional Metrics Example
Craig has a great illustration of my distinction between infrastructure and functional metrics here:
http://www.funnelholic.com/2009/03/12/memo-to-the-cfo-3-lead-generation-metrics-that-matter/
Cost Per Lead (CPL) could be called an "infrastructure" metric, as opposed to Cost Per Opportunity (CPO) which could be called a "functional" metric. CPO is tied to the lead and pipeline generation funnel, and not to the various tools and mechanics that cause CPL number variation. CPL feeds into CPO generation.

Update 2: Caveats and Another Functional Metrics Example
The challenges the metrics are expected to address:
1. In metrics, we often miss the forest for the trees. As I have mentioned before- Marketing is following Social Media.
2. Given the context of the million dollar Superbowl ads, we need to build the kind of "bridges" in social media that already exist in traditional media and which allow traditional media to justify its spend to some extent. That's a separate problem.

So taking the sales theme further (you can see I am trying to leverage my B2B sales/ account management experience) here's what I would call an infrastructure metric derived out of a sales force effectiveness ratio: social media effectiveness ratio = social media "wins"/ customer "contacts".

Now, you might call sales force effectiveness metric a functional metric that has been translated into an infrastructure metric. True, wins and contacts are tied to the platform. We then build a cross platform metric that takes this data and spits out the "functional metric" results.

The Four Philips brand equity measures- Uniqueness, Relevance, Attractiveness and Credibility- are a tougher portability nut to crack. However, a quick metric that is "translatable" that would be familiar to brand and category managers- ACV.


What do you think?


Additional Background
A backgrounder to help you develop your own perspective on the ideas here:
http://randomjunkyramblings.blogspot.com/2009/06/brands-economics-blink-twitter-facebook.html


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Brands, Economics, Blink, Twitter & Facebook: Part II

Almost titled Part II: Economics, Brands, Blink by Malcolm Gladwell, and Social Networking- Twitter & Facebook. Brevity is the soul of the blog... oops.

Part I of this Post:
Thanks to Twitter, I was reminded of an article on “Predictably Irrational” behavior:
http://www.npr.org/templates/story/story.php?storyId=19231906

Some more background can be found in my Part I post here:
http://randomjunkyramblings.blogspot.com/2009/06/economics-brands-blink-twitter-facebook.html

Marketing and Behavioral Economics.
The day care center experiment on the effects of social and market norms colliding provides interesting results. More importantly, it can serve as an interesting starting point for marketers to think about how to participate in conversations with their customers on social media sites.

Looking at the social media marketing vehicle as a "participant" on the social marketplace, it may help illuminate patterns that help the marketing vehicle navigate uncharted 'mindfields' with their experiential partners (read customers).

While this perspective should not be news to skilled brand managers, the key here would be developing patterns and tools that help brand managers make more effective decisions.

These theories could be used to:
1. Create markets with specific incentives (watch out for unintended consequences),
2. Make decisions that drive the market entity's/ brand vehicle's behavior within a marketplace, and,
3. Leverage various market players' behavior in a marketplace to your market entity's/ brand vehicle's advantage.

Points 2 & 3 can be interpreted as old school, carpet bombing, bulk-broadcast-media-buying strategy & social network or conversational marketing respectively.

Social Media and Behavioral Economics.
A potential application- could it help a brand decide which social media site to develop its presence on, especially if the brand could utilize all 3 approaches to negotiate? There are social marketers that would recommend using the third approach listed above as it is more "authentic". This seems to have become the prevailing thought in the B2C arena.

Where does Microsoft's strategic investment in Facebook, more a B2B deal that has B2C impact, fit across the 3 approaches listed above?

What do you think?

Update: To be even more explicit in my messaging:

1> Everything Must Go!?
As a marketer looking at the channels to reach out to your customer, you may need to understand how to leverage the new channels that have sprung up where your customer is not a "couch potato". As you learn more about the new channels and more about your customer, you will find new ways to apply your experience, knowledge and acumen in the new channels. You do not necessarily have to toss everything out of the window. :-)

2> Marketing Future 2.0
Marketing Future 2.0 arrives in baby steps- while there is an advantage to be being ahead of the learning curve, your best friend is still your ability to distill it into impact on consumer buying.

Now, what do you think?

Economics, Brands, Blink, Twitter & Facebook: Part I

Almost titled Part I: Economics, Brands, Blink by Malcolm Gladwell, and Social Networking- Twitter & Facebook.... As if that wasn't enough, did I mention Physics? I will, however, refrain from mentioning Star Trek... oops.

Some thoughts on Bob Pittman's perspective of the money making potential of the internet in this post, to give you some background:
http://randomjunkyramblings.blogspot.com/2009/02/consumer-behavior-and-robert-pittman-on.html

Behavioral Economics: Isn't that an oxymoron?
Have you read Blink by Malcolm Gladwell? There is an economics' field that seems to agree with Gladwell that human beings are not all rational masters of their emotions.

Behavioral Economics around us.
Thanks to Twitter (Paula Drum RT), I came across an article talking about behavioral economics:
http://www.npr.org/templates/story/story.php?storyId=104803094

Most of us have helped implement a behavioral economics based solution to the pension enrollment challenge: If you want people to enroll in the pension plan, then automatically enroll them — and let them opt out if they want to.

The article also covers an example of how government intervened to incentivize teens against getting pregnant. Predictably, this will get you thinking about how this theme ties in with prevailing thoughts on financial market regulation. The article cautions that the government could itself become an "imperfect decision maker" as a market participant.

The physicists amongst us must be wondering whether economics and psychology got together to give birth to either the observer effect or the uncertainty principle.

Behavioral Economics and Game Theory.
The article got me thinking about the interplay between behavioral economics and game theory. How would an approach to less-than-fully-rational-decision-making impact game theory cases like prisoners dilemma where rational decision making leads to "seemingly sub optimal" outcomes?

I found a paper that talks about behavioral game theory:
http://faculty.haas.berkeley.edu/hoteck/PAPERS/BGT.pdf

The tweet also reminded me of another article on "Predictably Irrational" behavior:
http://www.npr.org/templates/story/story.php?storyId=19231906

Now, what has all of this got to do with Marketing, Tweeting and Authentic Branding?

What do you think?

Part II of this post can be found here:

http://randomjunkyramblings.blogspot.com/2009/06/brands-economics-blink-twitter-facebook.html

Consumer Behavior and Robert Pittman on Investing in Media

Consumer Behavior
Robert Pittman had some interesting insights on consumer behavior. He provided an “action oriented” view of Maslow’s hierarchy by citing convenience and branding as key components of a consumer’s decisionmaking.

He defined convenience as physical, tangible productivity tools and branding as a means to prevent switching. Applying that to internet tools/ properties/ networks, the key trade off is effectively the relative “delta” of convenience vs. switching costs.

Advertising channels and consumer behavior
Robert pointed out that the internet is not killing TV, its really killing newspapers. Some thoughts put forth around this idea:
1> Pricing: He compared the cost per thousand impressions between TV/ radio and newspapers. He then questioned the rationale for the market difference.
2> Change in spend across channels: He presented data that highlighted the marketing spend across newspapers, yellow pages and the internet, with newspapers currently garnering more than twice the ad spend on either the internet or the yellow pages. Change in marketing tactics to adjust to the internet as a medium has not been drastic. Given the theme, this presents a tangible opportunity in the internet media segment.
3> Nature of advertising channels: The cable TV industry is larger than the broadcast TV industry; however, the cable TV industry is quite fragmented. This creates a difference in how advertisers approach these two channels.

Some takeaways
1> Critically analyze the value of internet properties
Is the internet properties’ lack of stick just a function of low switching costs?
Do internet properties really make us more productive or more effective as they interweave into our daily life?

2> Expect unrelenting, inexorable change
Citing the fact that TV show ratings lead their revenue impact, Robert sees a similar trend in the internet media. The internet is truly impacting consumers and consumer facing companies. Adapting to this change in consumer behavior will define which companies fail and which survive.

The talk led to questions, as usual:
1> The web and TV: How do we categorize the impact of online TV series viewers on series like The Sarah Connor Chronicles and Dollhouse? The former got the axe despite as many as 7 million viewers following the series online.
2> Channel relationships and Ad spend: Are the industry structures in place for the media planning industry to move quickly, seamlessly and effortlessly across the various advertising channels? Is it just a function of channel relationships, or it is also a function of the industry still being in the process of wrapping their arms around opportunities in the “new media” segment?

What do you think?


The Usual Disclaimer: This is purely a knowledge sharing resource and I have been careful to protect panelist/ speaker interests. Ethically, context is everything, and I will gladly retract anything that affects the parties mentioned. Call this my mini OpenCourseWare, if you will, where Open signifies life experiences.

Movies and Brands: Iron Man.

Iron Man made $100 Million over a weekend. i.e. about 3% of the US population has seen the movie across 2000 theaters.

While movie marketing/ branding/ merchandising is an interesting topic in itself, how many brands do you recall jumping onto the cobranding bandwagon?

The Thought Provoking Case of The Consumer Electronics Company

This case focuses highlighting, in sharp relief, how strategy and analytics, as tools to lay the groundwork for all that follows, can help in execution. For the tool savvy, I expect lightbulbs for strategy and analytics to flash every time we trigger a tripwire within the case.

The real skill here is in identifying all the tripwires you can trigger in a structured manner. i.e. Analytics backed solutions you can generate, and then rank them by impact.

Your inputs are welcome- have fun!

The usual case/ problem solving approach is top down:
Strategy-> Marketing-> Sales-> After Sales-> Customer Support
Here’s a case that will help you think recursively through this process!
The approach to this post is: Case -> (followed by) Key 1: Points to Discuss-> Key 2: Structure.

Note: This case is a Work in Progress. The keys will be published separately.

Case 1
The Thought Provoking Case of The Consumer Electronics Company

You have a $450 CyberSleek AB1 camera from The Consumer Electronics Company- their first CyberSleek, released in 2002. It has served you well over the years. You moved recently and lost the little USB cord that connects the camera to your laptop.

You search for the cord at the website in vain, and finally call The Consumer Electronics Company's support number to request a USB cord for your camera. Over a 45+ minute call, the customer support person creates your profile on the The Consumer Electronics Company website, keeps you on hold while searching for the correct USB cord, and finally gets you free shipping for the $20 cord as per the promotion run at that point of time.

Unfortunately, when you receive the package, you find that you were shipped the wrong make of the USB cord.

Thinking that customer support may not have the right tools to help you, you look to give the website another try. You go back to the site, struggle for over and hour and finally find your cord this time by eliminating, as an option, the one you were mistakenly sent. You order the new cord and have to pay shipping charges this time around for a total of $30 in charges.

You call back to claim a refund because customer service shipped the wrong cord to you, and are asked to ship the first cord back, at your own expense, to claim a refund. You have already been charged for the new cord you bought from the website. Requesting customer support to check these details does not help your case.

Shipping the first cord back, where you pay the $20 charges for the customer service mistake, does not make sense to you. You have spent enough time on this task already. The cord is useless with you anyway. Finally you relent. You request that atleast the shipping charges be borne by The Consumer Electronics Company. If you thought that should be easy- the customer support person will now have to contact another department to ensure you don't pay shipping charges.

You receive a standardized email about this conversation with customer support which miscategorizes the request and are requested to call another number.

When you call the next number, you have to explain the situation from scratch. You are now beginning to get frustrated. You want to talk to a supervisor regarding the quality of support you have received. You are put on hold and the call drops.

You call back the next day, and explain the process from scratch. You are finally advised that The Consumer Electronics Company will pay the charges for shipping back the incorrect cord sent to you. You demand to speak with someone who can take some action to alleviate the misery of going through this process. You believe you should also be refunded the shipping charges for the cord you bought yourself, because, it was, after all, customer support’s fault that you lost out on the promotion.

You are transferred to customer relations, where you explain the situation from scratch. Again. You mention that any customer who goes through this process will talk, even blog about it, and create a lot of negative publicity for the firm. Customer relations responds that they can do nothing more that pay the shipping charges for receiving the incorrect cord.

You are transferred back to customer support, where someone commiserates. You mention that you want action not commiseration. The whole process so far does not make sense from your point of view. Customer support agrees.

You go to FedEx and ship the cord incorrectly sent to you. Shipping is free. You receive the new cord for $30. $20 is credited to your account in a few days.

You are left wondering that you are a consumer of a $450 product and The Consumer Electronics Company put you through a lot of hassle for a $20 accessory.

The process seems un-American and un-East Asian to you. What are the things you would like this company do, in its own interest?


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