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| Volume 8, Issue 10 |
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In This Issue:
 Google-Yahoo ad deal is bad for online advertising
Solving the marketing resources allocation puzzle
Creating a positive professional image
 Marketers missing the online-offline connection
 A crash course in communication
 E-mail marketers slopping it up: Part 47 [Subject lines]
Mad money [how to sell to the wealthy]
 How to survive a recession (or just beat your competition cold in any market)
Decisions move up the ladder as forecasts move down
Marketing lowdown: Choosing an ad agency
 The three levels of branding at Beijing
Get out of the "middle of the road"
I want my private life back
 Surprising things that affect memory
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Google-Yahoo ad deal is bad for online advertising
A proposed advertising deal between Internet competitors Google and Yahoo would reduce competitiveness in the Internet advertising market, likely resulting in higher advertising rates, according to Harvard Business School assistant professor Benjamin Edelman.
In testimony prepared for an appearance before the U.S. House of Representatives Committee on the Judiciary Task Force on Competition Policy and Antitrust Laws, Edelman wrote that the deal could have an anticompetitive effect on Internet advertising...
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Solving the marketing resources allocation puzzle
Everywhere TV
If screens seem to be popping up everywhere, that's because they are.
In a DVR world, advertisers are reaching outside the home for today's most desirable audience: a captive one. Anywhere people might be waiting equals an opportunity to air short-form content and
advertising. Tune in to the forefront of "advertainment." [Whose been successful using this media strategy - and why?...]
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Television spots, word-of-mouth, viral ads. Marketing managers have more options at their disposal than ever before. But how to decide? Harvard Business School professors Sunil Gupta and Thomas Steenburgh offer a way for managers to conceptualize the most effective approach.
U.S. companies spent a staggering $285 billion on advertising in 2006, according to Advertising Age. That's a lot of dollars and expectations being handed to advertising managers to generate returns. But do marketing managers allocate their resources wisely? Are traditional methods of resource allocation such as heuristics, decision
rules, and "bottom up" approaches still effective in today's complex marketing environment? To help practicioners answer this question, Harvard Business School professors Sunil Gupta and Tom Steenburgh surveyed the academic literature as well as practical examples to create a framework to help managers think about their allocation
challenges. The result was published in a recent paper, "Allocating Marketing Resources". Brand managers can be confronted with a complex, daunting task, the authors note. "Marketing resource allocation decisions need to be made at several levels—across countries,
across products, across marketing mix elements, across different vehicles within a marketing mix element (e.g., TV versus Internet for advertising). Each decision requires some specific considerations." The good news is that an increasing availability of data, combined with more sophisticated methods of analyzing it,
provide managers with powerful tools to help them isolate the effects of various marketing instruments. The framework developed by Gupta and Steenburgh helps managers think through the process, in part by looking at examples of what has worked for firms in the past...
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Creating a positive professional image
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Laura Morgan Roberts is an assistant professor in the Organizational Behavior unit at Harvard Business School. "Members of negatively stereotyped identity groups may experience an additional form of identity threat known as "devaluation." |
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"Most people use a variety of strategies for managing impressions of their social identities."
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As HBS professor Laura Morgan Roberts sees it, if you aren't managing your own professional image, others are.
"People are constantly observing your behavior and forming theories about your competence, character, and commitment, which are rapidly disseminated throughout your workplace," she says. "It is only wise to add your voice in framing others' theories
about who you are and what you can accomplish." There are plenty of books telling you how to "dress for success" and control your body language. But keeping on top of your personal traits is only part of the story of managing your professional image, says
Roberts. You also belong to a social identity group—African American male, working mother—that brings its own stereotyping from the people you work with, especially in today's diverse workplaces. You can put on a suit and cut your hair to improve your
appearance, but how do you manage something like skin color? Roberts will present her research, called "Changing Faces: Professional Image Construction in Diverse
Organizational Settings," in the October issue of the Academy of Management Review. [Here are some key findings in this HBS exclusive interview...
Q: What are the steps individuals should take to manage their professional image?
A: First, you must realize that if you aren't managing your own professional image, someone else is.
People are constantly observing your behavior and forming theories about your competence, character, and commitment, which are rapidly disseminated throughout your workplace. It is only wise to add your voice in framing others' theories about who you
are and what you can accomplish. Be the author of your own identity. Take a strategic, proactive approach to managing your image...]
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Marketers missing the online-offline connection
Almost half the brands that spend money and resources on search marketing fail to connect those campaigns to their offline marketing efforts, according to research made public this month by search marketing firm iProspect.
The study, produced with JupiterResearch, found that only 55% of companies conducting search engine marketing (SEM) are purposely integrating those campaigns with at least one offline marketing channel. Those that do coordinate with marketing in another medium are most likely to integrate SEM with direct mail (34%) or with magazine or
newspaper advertising (29%). Only 12% of respondents reported coordinating SEM campaigns with either television or radio marketing. That goes against earlier iProspect findings about how users are led to search, the report says. An August 2007 study found that more than two-thirds of users (67%) perform online searches...
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A crash course in communication
Sales&MktgWatch Classic:
Recently I heard someone say, "Communication is easy." I disagree. Talking is easy; communication, which means an exchange or communion with another, requires greater skill. An exchange that is a communion demands that we listen and speak skillfully, not just talk mindlessly. And interacting with fearful, angry, or frustrated people
can be even more difficult, because we're less skillful when caught up in such emotions. Yet don't despair or resign yourself to a lifetime of miscommunication at work or home! Good communicators can be honed as well as born. Here are a few tips to get you started...
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E-mail marketers slopping it up: Part 47 [Subject lines]
OK, so “Part 47” is an exaggeration, but every time a new study on e-mail marketers’ practices comes out, it without fail illustrates how loosey goosey we are on this particular channel.
And I mean “we.” This newsletter is as guilty of slopping it up as any e-mailer out there—no, not spamming, just not adhering to simple, commonly used direct marketing tactics. The most recent e-mail slop reminder comes courtesy of online marketing agency eROI in the form of its Q3 2008 Elements of Email Survey. According to the
survey, just 25% of marketers test subject lines on a regular basis. Just 25%.The subject line for e-mail is akin to an outer envelope in direct mail. Is it even conceivable that a traditional direct marketer would fail to test copy treatment on
the first thing recipients see? [Meanwhile, another area where many marketers are missing opportunities in e-mail is by failing to test their...]
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Mad money [how to sell to the wealthy]
Who's still spending on luxury goods and services? The wealthy, that's who“
Let me tell you about the very rich,” F. Scott Fitzgerald wrote. “They are different from you and me.” Yes, they are. For one thing, they have money. And they're spending it despite the economic downturn. For example, luxury travel marketer Ultimate Escapes has seen no falloff in membership sales. These range in cost from
$70,000 to $350,000. “People are being more cautious before making purchases,” admits Neal Rubin, the company's senior vice president of marketing. But response is holding, he says. “The very wealthy continue to be very wealthy, even in a down economy,” adds Lisa Joy Rosner, vice president of marketing for MyBuys Inc., a firm that helps online
merchants with demographic targeting. Want to snare a piece of that wealth? First you have to understand a few things about the rich. One is that they want to be educated, not pitched. Another is that they expect top-notch service. In addition, they rely heavily on advice from their peers. And they do a lot of...
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How to survive a recession (or just beat your competition cold in any market)
Wes Ball is author of The Alpha Factor: The Secret to Dominating Competitors and Creating Self-Sustaining Success (Westlyn Publishing, www.thealphafactor.com). He is also founder and president of The Ball Group, a strategic innovation and marketing
consulting firm that helps businesses identify new opportunities for creating dramatic growth.
Any time business managers hear the word "recession," they start looking around for ways to weather the coming storm. That usually means immediate budget reviews with plenty of cuts on the revenue-generation side of the company. As a result, sales, marketing, advertising and any other outreach-focused activities feel the crunch fast
and hard. But one of the interesting things research finds about "alpha companies"—those rare companies who are such dominant leaders that they actually control decisions of both customers and competitors—is that even the strongest companies are most threatened during recessions, not because of the economy, but
because of these cost-cutting tactics. Competitors who continue to invest in outreach can easily undermine even the strongest marketer's previous strength. What does that mean for sales forces and marketing executives?...
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Chronicles of a sales leader: Decisions move up the ladder as forecasts move down
What to do when the fish in your client pool are behaving—and "biting"—differently.
About 90 minutes north of where we live, there’s a resort community on Lake Michigan where we like to spend our weekends. Beside the plentiful waters of the large lake, numerous inland lakes and rivers come together to create one of the best playgrounds for those that spend their free time with rod and reel. While there is often debate
amongst any community of anglers about the best lures and fishing holes, there seems to be agreement these days in this community that the fish are not biting nearly as much as they have in past summers. The chief culprit is a once in a century rain storm that brought nearly 15 inches of rain in June, all of which came within a two-day
period. During a visit there recently, one of the locals explained to me the various effects of what a rain like that does to the complex ecosystem below the surface of the many waters. In short, it drastically changes the habits and behaviors of anything that calls the lakes and rivers home. More specifically, they are now feeding in
different ways, in different places and at different times. This is where the ecology lesson ends (especially since I am the last person who should be sharing knowledge in this area), and the business lesson picks up. That visit made me think about how sales and marketing leaders are struggling right now with the same challenge—a difficult
economic environment that has changed the behaviors and strategies of their customers and prospects. Like fish who are adjusting to changes to their environment, our customers are changing their buying behaviors and protocols in ways that can either mean risk or opportunity. While I can’t provide much guidance on how to improve your
daily catch, I do have some thoughts on how to keep up with the buying process of your customers:
1. Prepare for decisions to move upward as the economic outlook goes down...
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Marketing lowdown: Choosing an ad agency
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S&MM online columnist Robert Grede, author of "Naked Marketing: The Bare Essentials" (Prentice Hall), speaks on marketing and entrepreneurial management at universities, corporate venues, and street corners.
Why do you need an advertising agency? And how do you go about selecting the right one for your business? An ad agency marks up everything they produce as much as 20%, charges 15% commission on media and doesn't know nearly as much about your product or industry as you do. Who needs them? You do. Firstly, an agency takes the burden of the
production process off your hands and makes sure everything is done right. Agencies charge for production because they earn it. You may know how to contact a good illustrator, specify typefaces, or even judge a printer's capabilities. But it's not likely you know how to do all of these things. Secondly, you generally pay the same
price for media whether you use an agency or not. So, why not let a professional do it for you? Lastly, the pros at ad agencies are functionally specific. Your lawyer or your accountant will never know your industry as well as you do. They know law and
accounting. Likewise, your ad agency knows advertising and how best to apply it to your business.
Delegate It
There are three ways to delegate the advertising function...
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The three levels of branding at Beijing
The 2008 Olympics have already become "the branded Olympics," even before the opening ceremonies.
The branding is at three levels—with hundreds of millions of dollars at stake, along with a nation's global image. First, Olympics sponsors are the most visibly commercial aspect of the Games to the huge television audiences. The "five rings" is one of the most readily and widely recognized organizational symbols in the world. The dozen corporate members of the Olympic Partner Program each pay an estimated...
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Get out of the "middle of the road"
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These days, the only thing more unsettled than the weather is the state of the economy.
Ford celebrates the 100th anniversary of the Model-T by posting the biggest quarterly loss in its history. The major airlines fly into the summer-vacation season by adding vast amounts of red ink to an industry that is already drowning in it. (American Airlines, by one estimate, loses $3.3 million per day.) And Yahoo, once the lovable
darling of the Internet, caves in to corporate curmudgeon Carl Icahn as it tries to maintain its independence. And yet…amidst all these dark clouds ands ominous forecasts, there are patches of bright sun and clear skies. Honda just reported profits of $1.7 billion for the quarter ended June 30—a record quarterly performance
for a company that's posted lots of great quarters. Southwest Airlines reported yet another profitable quarter—a 15% increase over a year ago, and its 69th consecutive quarter of profitability. And Netflix, the online-movie pioneer whose fortunes skeptics love to question, delivered better-than-expected results and increased its
subscriber base to an eye-opening 8.4 million households. How is it that Honda, Southwest, and Netflix manage to thrive, when so many of their peers not only struggle to break even but flirt with outright disaster? The answers don't just speak to these three competitors, but to the new logic of competition itself. First, high-performing
companies understand that it's not enough to be "pretty good" at everything anymore. As a company, you have to be the most of something...
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I want my private life back
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Yes, breaking down of boundaries between one's personal and professional lives work for some people. But Paul Michelman talks about why that doesn't work for him.
All the terrific discussion about my recent post on the collision of things personal and professional on Facebook got me thinking about a much larger issue: the collision of things personal and professional in life. On several fronts I feel like I'm being encouraged to give up on the idea that I can live two distinct existences—one focused
on home and the other focused on work. No, it's by no means a new trend, but I do think that it's accelerating. The integration of work "friends" and friend "friends" on Facebook is just one tiny example. That BlackBerry I'm about to check is another. Just as importantly, several management thought leaders I deeply respect have been
weighing in with their support for letting traditional barriers fall. [Why am I clinging to such a backward view of work and life?...]
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Surprising things that affect memory
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Maintaining mental acuity is a major concern for aging Americans--they want to make the most of their golden years rather than have to struggle through them.
In fact, adults are more than twice as likely to fear losing their mental capacity as their physical capacity, according to a 2006 poll by Research! America, a nonprofit public education and advocacy alliance. While many know the basics when it comes to keeping their minds sharp (stick with those crosswords), a crop of new research is
showing that lifestyle choices may play an even bigger role than people realize, particularly in terms of memory. Factors--some positive, some negative--range from diet to unlikely medications and hormonal changes. "Most people feel that they are victims when it comes to Alzheimer's and memory loss," says Dr. Vincent Fortanasce,
author of the new book The Anti-Alzheimer's Prescription. But Fortanasce points out that there's a difference between mental agility, which is our ability to multi-task and do things quickly, and mental capacity, which is our ability to reason and use our experience. When we age, just as we naturally lose physical agility, we lose mental
agility. But you can do something about, even increase, your mental capacity as you grow older, Fortanasce says...
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