RAM CHARAN'S NEW BOOK "KNOW-HOW" LOOKS GOOD

This from the folks over at 800CEOREAD:

Ram Charan's insight into the real content of leadership provides you with the eight fundamental skills needed for success in the twenty-first century:

  • Positioning (and, when necessary, repositioning) your business by zeroing in on the central idea that meets customer needs and makes money
  • Connecting the dots by pinpointing patterns of external change ahead of others
  • Shaping the way people work together by leading the social system of your business
  • Judging people by getting to the truth of a person
  • Molding high-energy, high-powered, high-ego people into a working team of leaders in which they equal more than the sum of their parts
  • Knowing the destination where you want to take your business by developing goals that balance what the business can become with what it can realistically achieve
  • Setting laser-sharp priorities that become the road map for meeting your goals
  • Dealing creatively and positively with societal pressures that go beyond the economic value creation activities of your business

Know-How is the missing link of leadership. By showing how the eight know-hows link to, interact with, and reinforce personal and psychological traits, Ram Charan provides a holistic and innovative portrait of successful leaders of the twenty-first century.

NEW 2007 TWO-DAY MARKETING WORKSHOPS - Wage and win battles for market share. Win customers from larger competitors. Defend customers from competitor attack. Identify exploitable competitor weaknesses. Properly frame campai to vSente's Armory - Tools and Techniques for the Competitive Marketer. Click below for a free preview. No annoying forms to fill out, no email address required, just click and preview...

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GOING TO THE MATTRESSES - INTEL AND AMD ENGAGED IN MOTHER OF ALL MARKET SHARE BATTLES

The Mafia utilizes an effective ritual called "going to the mattresses" when engaged in a turf war with a competing family. The ritual consists of all of the family's "soldiers" taking up residence in a "safe house" where mattresses are rolled out on the floor and the soldiers live there for the duration of their war. The essence of this ritual is both symbolic and practical. I mention this because AMD is currently getting whacked by Intel in a brutal, brutal, battle for market share.

I intentionally selected this metaphor because it's always fun to induce a case vapors into the new marketing nannies who when confronted with the need to fight - to go to the mattresses - grab their autographed copies of Blue Ocean, turn tail and run. I have no doubt, that inside the halls of AMD there are some mighty conversations taking place about how to win this war. Oh to be a fly on the wall.

NEW 2007 TWO-DAY MARKETING WORKSHOPS - Wage and win battles for market share. Win customers from larger competitors. Defend customers from competitor attack. Identify exploitable competitor weaknesses. Properly frame campai to vSente's Armory - Tools and Techniques for the Competitive Marketer. Click below for a free preview. No annoying forms to fill out, no email address required, just click and preview...

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HOW GOOGLE ATTACKED THE INDUSTRY LEADERS - TURNABOUT IS FAIR PLAY...

Interesting New York Times article about Silicon Valley start-ups gunning for Google:

When Lawrence Page and Sergey Brin first started tinkering with what would become Google, other search engines like AltaVista and Lycos and Excite were dominant. But the companies that owned them were distracted by efforts to diversify their businesses, and they took their eye off the ball of Internet search and stopped innovating. Some now say that search has not evolved much in years, and that Google is similarly distracted as it introduces new products like word processors, spreadsheets and online payment systems and expands into online video, social networking and other businesses. “The more Google starts to think about taking on Microsoft, the less it is a pure search play, and the more it opens the door for new innovations,” said Mr. Moldow, the Foundation Capital partner. “That’s great for us.”erly frame campai to vSente's Armory - Tools and Techniques for the Competitive Marketer. Click below for a free preview. No annoying forms to fill out, no email address required, just click and preview...

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PFIZER TO CUT 20% OF IT'S U.S. SALES FORCE BECAUSE OF POOR SALES...

The New York Times is reporting that the new chief at Pfizer will reduce their sales force by almost 2,400 sales representatives and managers, which is a fifth of its United States sales force. This from the article:

The bloated sales forces, analysts say, have alienated doctors and contributed to high drug prices.

Because Pfizer led the sales force expansion, other companies will probably follow its decision to cut back, said Michael Krensavage, a drug industry analyst at Raymond James.

“The other companies were reluctant to cut their sales forces while Pfizer was continuing to have people on the ground,” he said. “It seems like it’s the end of an arms race.”

In a statement about the layoffs, Pfizer said it would announce more “actions for transforming the company” in January.

Nowhere did the analysts ask how Pfizer intends to replace this horsepower and Pfizer's only indication was in the last paragraph above about announcing more actions in January.

Does Pfizer really expect that their competitors will match their cuts? Seems to me that now, more than ever, the drug companies need feet on the street in order to fight for market share. Savvy competitors will be competing to hire the sales folks laid off by Pfizer in order to take Pfizer market share.

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NETSUITE ATTEMPTS A BLUNT FORCE ATTACK ON SALESFORCE.COM

CRM Guru is hosting a webinar and PDF presentation from the folks at NetSuite:

Zach Nelson CEO of NetSuite Inc., and a panel of former customers of Salesforce.com discuss   of "The Top 5 Reasons Customers Abandon Salesforce.com"  and why thousands of Salesforce.com users have switched to NetSuite, the integrated business management suite       that includes CRM, Accounting/ERP and Ecommerce.

I was critical of Jonathon Tangs attack a year ago and I'm equally skeptical of NetSuite's attempt. This is not the way you attack and dislodge an industry leader.

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LINDA KAPLAN THALER QUACKS ABOUT KINDNESS

So Linda Kaplan Thaler the composer of the Toys-R-Us jingle, co-creator of the AFLAC duck, and co-founder of the agency bearing her name, decides that kindness will conquer the business world. In a new book The Power of Nice: How to Conquer the Business World with Kindness  Kaplan suggests that:

Beat out the competition; grab your slice of the pie before they get it first. Because if you don’t, you’ll be left with only crumbs. Right? Wrong. Life is not a zero-sum game: If the other person wins, I lose, or vice versa.

It's not a zero-sum game? If I'm selling a missile defense system and I lose a billion dollar deal to a competitor how is that not a loss? The other guy won. I lost. It was fair and square. There aren't any crumbs left over. It's called competition. I'm not going to whine about it. I go home, lick my wounds, and get up the next day ready to fight again. I don't expect crumbs, compassion or sharing from my competitor. If you do, then you're in the wrong line of work.

But wait it gets better. Kaplan offers:

There’s no need to squabble over who gets the biggest piece of pie—we just have to bake a bigger pie. After all, who says the pie is finite? The universe isn’t—the universe is infinite. Our capacity for love isn’t finite, either, as any parent knows. You have your first child and you think your heart couldn’t grow any bigger. Then you have a second child and it doubles, or triples.

Ok boys, just go out and bake a bigger pie. Don't worry Auntie Linda says there'll be more than enough for everybody. Or better yet have another kid. Yea, now that's the answer. And to think this passes for enlightened thinking...

Read our post RED OR BLUE? WHAT COLOR IS YOUR MARKETING DEPARTMENT? for more thoughts on how the self-styled marketing intelligentsia is destroying enterprise competitiveness.

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JOHNNIE MOORE, WARFARE ANALOGIES AND WORLD OF WARCRAFT...

Johnnie Moore is thinking about the limits of marketing as warfare analogies as he plays World of Warcraft - the on line gaming environment. This from his recent post:

There've been some good posts around the blogosphere about the limits of the analogy of marketing as warfare - where we have campaigns, look for impact, outmanoeuvre the enemy etc. James has chronicled this pretty well.

Well, I've been thinking there might be something to learn from World of Warcraft.  What if there is more to learn from WoW than from seeing marketing as war?

I believe he's speaking of the exchanges James and I have had where we discuss the differences between "old" marketing, new marketing and military metaphors. I've never played World of Warcraft so I can't offer an opinion on it's application to marketing strategy. If you'd like to read why we use military metaphors to communicate our campaigning methodology read this post.

If you find yourself struggling with military analogies you might look at this paper written by Anthony Judge titled: "Enhancing Sustainable Development Strategies Through Avoidance of Military Metaphors". If you're looking for something beyond the standard sport, military, or ecosystem metaphor this paper will surely spark some new ideas. As for Johnnies thoughts I hope he develops them further - be interesting to read his viewpoint.

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SHOULD BtoB USE MARKET SHARE GROWTH TO ANOINT "BEST OF" AWARDS?

There continues to be massive teeth-gnashing over measuring marketing effectiveness. The marketing community runs wildly away from the blindingly obvious answer as to how you measure marketing effectiveness and CMO performance. The blindingly obvious answer is market share.

You judge the effectiveness of your marketing campaign based upon it's impact on your market share.

You judge the performance of your CMO based upon the impact they've had on your market share.

You hire a new CMO based upon their track record generating market share.

BtoB Magazine the influential read for marketing strategists once again is seeking nominations for it's Best of 2006 awards. We've commented in the past about the lack of quantitative input for these awards. We'll likely comment in the future. The two major criteria for awarding the BtoB distinction is "awards won in the past 12 months" and "breakthroughs". Why not establish a criteria for "market share gains" or...

Greatest year over year gain in market share?

Best market share gain against enormous odds?

Best attempt at market share gain that failed?

OK, so you get the idea. Read my post titled: USING MARKET SHARE VECTORS TO GAUGE CHIEF MARKETING OFFICER EFFECTIVENESS for one approach on how to use market share to gauge marketing effectiveness.

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92% OF BRAND CONVERSATIONS TAKING PLACE OFF LINE? HMMMMMMM...

About 90% of this blogs traffic comes off of good "old-fashioned" Google searches. I continue to approach the "new" marketing folks with a serious dose of "show me". The latest analysis of inroads made by "new" marketers is pretty dismal. This from Steve Rubel:

Advertising Age takes a hard look at blogs, podcasting, RSS and other forms of social media and finds that most folks still get their content the old-fashioned way. This extends across all demographics.

They cite the following data points:

* 7% of American adults write blogs and 22% read them (Jupiter)
* About 8% listen to podcasts and 5% use RSS feeds (Jupiter)
* 88% of the at-work audience doesn't know what RSS is (WorkPlace Print Media)
* 92% of brand conversations were taking place offline (Keller Fay)

Read the rest ofhis post here.

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JAFFE JUICE - 23 THINGS EVERY COMPANY SHOULD MONITOR...

Jaffe Juice has a super post up titled "23 Things Every Company Should Monitor". The list was originally Started by Cameron Olthuis on his blog, Pronet advertising. Several others joined in on the conversation and have created an ad-hoc list of sources and techniques companies should be using to monitor their reputation, competitor moves and other industry dynamics. This ties directly into my recent post on the importance of market share as your primary marketing metric. Market share is a relative measurement that gauges your performance against external benchmarks.

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A ROUGH RULE OF THUMB FOR ALLOCATING YOUR MARKETING BUDGET

Several years ago I had to really struggle breaking in a new client. The struggle was over the budget. For most campaigns there are two basic types of costs. The first are creative costs. These are costs to create the campaign elements and include, research strategy, positioning, art direction, photography, illustration, copywriting etc. The second are the costs to produce and place the campaign elements and include printing, postage, bandwidth and media placement expenses.

My new client was use to allocating 90% of his budget for production and placement costs. Leaving 10% for all creation activities. The struggle was generated by my allocation of a 50/50 split between creative and production/placement dollars. More specifically I was budgeting for a significantly higher expenditure for competitive analysis and message creation.Also, I knew that we could reduce his overall budget by better targeting prospects and by switching to a direct mail emphasis from his current trade ad bias.

The big numbers for the his campaign were $250,000 for a nine month campaign split 50/50 between creation and placement. The client had budgeted $300,000 for the campaign and the fact that I was saving him $50,000 off the top was lost on him. The only thing he could focus on was the fees he was paying for what he characterized as non-productive costs for research, strategy, positioning, etc.

Most businesses today still feel the way my client did - which is dollars spent on research, strategy and positioning are wasted dollars. Most large agencies reinforce this notion by giving away for free their research, strategy and creative via the traditional account review process - which is also one of the reasons why most campaigns fail. I was able to convince the client that research and strategy were the drivers of any campaigning effort. And with better intell we could immediately and materially reduce his campaign budget while significantly increasing the effectiveness of each dollar spent.

Maneuver marketing allows the astute practitioner to dramaticallyimpact their sales and marketing effectiveness. For many campaigns we have reduced marketing budgets on average 20%, and have increased revenue 50% - over an 18 month time frame. Here's a rough rule of thumb you can use in order to frame a maneuver campaign. Take your existing budget and cut it 20% - then allocate your remaining dollars on an equal basis to creation and production/placement categories. In other words every dollar you spend on media should be backed by another dollar for research, strategy, positioning and creation. Maneuver theory can decrease your marketing budget while significantly increasing revenue. Why? Because each dollar is targeted and accountable. The cornerstone of maneuver theory is competitive analysis.

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HOW TO GET YOUR MARKETING BUDGET APPROVED...

The attacks on marketing accountability are gaining momentum. One of the outcomes of this increased scrutiny has been CEO's unwilling to continue to fund the soft, squishy marketing initiatives that do not clearly generate a measurable ROI.

If you find yourself in this situation, and you're running marketing for a mid-size enterprise or business unit, here is a different approach to gain the support of your CEO. Frame your budget around a tactical campaign defined by market share, profit, budget and a time frame. Most CEO's will react positively if you frame the budget this way:

We're developing and will execute an attack campaign, designed to win 7% share (42% direct margins) from competitors X, Y and Z, over the next 6 months, with a hard-dollar budget of $1.2 million.

What's really interesting about this kind of approach is that it requires the marketer to strictly examine and justify everything in the budget. If it doesn't contribute to share gain and profit margin within the campaign time period, it gets tossed. And it's critical you use the words attack, execute, campaign, profit, share, etc. CEO's are tuning out the soft fuzzy stuff.

Learn how to wage and win battles for market share.
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USING MARKET SHARE VECTORS TO GAUGE CHIEF MARKETING OFFICER EFFECTIVENESS

Mktshrmoimg There are three market share metrics that when aggragated can be used to gauge the effectiveness of your CMO and all marketing activities. The metrics are the volume, value and vector of your market share.

1. VOLUME. Market share volume is the traditional notion of share measured in dollars or units relative to your competition. While volume is a good initial indicator, marketers need to know the value of this share and the trend of their share.

2. VALUE. Market share value attachs a quantitative value, measured by percentage margin, to your market share volume. Having a large share of an unprofitable market is not sustainable. Alternatively, holding a smaller share that is profitable may be sustainable.

3. VECTOR. Market share vector is a trend measurement that depicts the direction your market share volume and value are heading, over time, relative to your primary and secondary competitors. The vector has a starting point, at least one intermediate measurement point and an ending point, typically the conclusion of a campaign, or performance review date of a CMO.

Market share vectors unambiguously measure enterprise success relative to it's peers. The primary function of market share vectors is to gauge the effectiveness of your marketing activities and the performance of your CMO. Market share vectors are the CMO's version of quota's, which sales reps are generally evaluated on (yes, I am saying that CMO's should have market share quota's and be judged on their ability to hit them). A few more comments on market share vectors:

1. Timing. Market share vectors can be used to judge effectiveness over a multi-year career, a multi-month campaign or as part of an annual review of budgets and plans. The vector requires a starting point at which all competitors are measured, an intermediate point and a concluding point that will be used to determine the vector trend.

2. Scaling. For start-ups or small firms with very small share, market share vectors can be scaled down so as to meaningfully measure actual performance. To scale down market share vectors simply select a subset of customers, territories, segments or categories and measure your relative share within that limited arena.

3. Influences. Poor vector performance may be due to influences outside the realm of control of marketing and the CMO. But the same thing applies to sales reps... there are many influences from quality, to shipping, to design decisions that a sales rep must live and die with, in their efforts to achieve a quota. The stark reality generated by market share vectors needs to be tempered within the context of issues, problems and opportunities faced by the enterprise and by the CMO. Market share vectors set up a baseline framework from which a CEO or CFO might begin to understand the effectiveness of their CMO and their marketing activities.

4. Intelligence. Some enterprises do not have the competitive data necessary to measure market share vectors. Others may not have the will or the interest to generate competitive intelligence. To the former, they need to begin the process of establishing a competitive intelligence competency... market share vectors are a great way to begin. Regarding the latter, enterprises without the will or interest need to understand the importance of external metrics and the peril they place themselves in when they operate without these guide posts.

We have a simple Excel worksheet you can use to plot market share vectors. Shoot me an email and I'll send you the worksheet.

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CMO's AND THE WILL TO WIN

John Byrne the former editor of Fast Company, wrote a provocative letter from the editor last year titled Competing to Win. This was for the Fast Company issue that featured George Stalk and Hardball. John started his letter with:

Competition. In business, we live and die by it. It sharpens elbows and brightens brain cells. It brings accountability to what we do. And it can also get out of control.

I like this. It's reality. John continues:

For the longest time, conventional wisdom held that we or our companies could succeed only if others failed.

Ok, this makes me a little nervous - I smell a set-up coming. John continues:

We believed that in order to win in business, you had to outsmart and outdo your rival, to exploit his miscues and blunders, to steal market share -- to pound your competitor into the ground.

We believed???? Who exactly is we and why is it in the past tense? As if it is a relic of the past? I for one, and I would guess that some of the Fast Company readership, most of American business, and, George Stalk still believe this. Here's John setting up the punch line:

In the 1990s, some of these old assumptions about strategy and competition gave way to something kinder and gentler. Business, we came to think, wasn't like chess or poker where someone has to lose in order for you to win.

So John's punch line is that this mysterious collective of WE got together and decided that business IS NOT like a game with a winner and a loser. And instead it was possible to consider a kinder and gentler scenario where you team up with your rivals, not crush them.

Certainly, nobody will disagree with John that there may be times when you can partner with a competitor. But these partnering opportunities (that don't fall under the legal definition or perception of collusion) tend to be rare, tricky to execute, and require strict adult supervision to make sure that the players don't give away the company store.

I don't think John is advocating that businesses stop competing. But what the kinder gentler folks misunderstand is that they do not control  the transaction. Implementing their little epiphany requires the cooperation of your competition who might be hell bent on your destruction. And have no desire to partner. What do you do then? Predictably, most of the kinder gentler crowd head for the exits.

I am amused by the war of words initiated by the kinder gentler crowd. If you happen to believe in capitalism, competition and profit you immediately get tagged with words and phrases like, old school, neanderthal, knuckle-dragging, testosterone-fueled, blood-thirsty, immoral, unethical, etc. etc. etc. This from the Fast Company article on George Stalk:

"[Stalk and Lachenauer] are on a brutal, macho trip," wrote one reviewer for the Financial Times .

OK. SO WHAT IS THE POINT OF THIS RANT?

The point is that since the early 90's, the kinder gentler crowd with their glut of squishy, culturally focused initiatives, have systematically gutted many sales and marketing organizations of competitive instincts. And in doing so have completely eliminated the will to win.

Selling is a competitive endeavor that requires a will to win. Every business, every day competes. Buyers make decisions that generate winners and losers. Whether you are buying a gallon of milk or a missile defense system your transaction results in a winner and loser(s). This is an inescapable, unavoidable result of a vibrant capitalistic system.

Selling at it's core is about asking for the order. About maximizing your profit (NOT YOUR CUSTOMERS!) About pushing through a price increase. Collecting deliquent accounts. Tough negotiations. Telling the customer NO. Most of the time selling is about selling marginal products and inferior service.

Most importantly selling is about winning and losing. Many folks dislike this game. Which is why they're attempting to replace it with something THEY do like. And in doing so, are rendering their organizations completely vulnerable and totally defenseless.

One of my mentors long ago claimed those who can't sell, market.

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PRINCE KLEMENS VON METTERNICH VIEW OF GOOGLE...

Good article in a recent Economist relating Google's 21st century competitive threats to 19th century history:

PRINCE KLEMENS VON METTERNICH, foreign minister of the Austrian Empire during the Napoleonic era and its aftermath, would have no trouble recognising Google.

Click here to read the whole article.

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SETH GODIN OFFERS SOME USEFUL PRACTICAL INSIGHTS (YES, YOU READ THAT RIGHT)

Seth Godin has written several good blog entries in the past month or so. Since I'm a frequent critic of all things Seth, I wanted to highlight the good stuff too. Here are a few of the entries...

Hard sell at the farmer's market

Nine things marketers ought to know about salespeople (and two bonuses)

Ten things programmers might want to know about marketers

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ANDY MONFRIED WRITES ABOUT MEDIOCRITY, SHOWERHEADS AND RAISING KIDS

Andy Monfried connects mediocrity, shower heads at his gym and new age child-rearing theories in a neat little post. I especially liked this...

It was a great lesson in life -- whether as a little kid, with a bunch of six year olds - we won or lost....to our classmates. We celebrated victory,(with a Slurpee from 7-11) and understood defeat. It taught us how to STRIVE FOR VICTORY, but be a good loser.

Today, amongst six year olds in our town -- EVERYONE WINS.  There is no loser .... they are all told (the kids) at the end of the game, "its a tie."

Read the complete post here. The comments are pretty good too.

Learn how to wage and win battles for market share.
Download the free PDF preview of the Art of Attack. Just click to get the PDF. There are no forms to fill out, you don’t need to leave your email address. No annoying questions to answer. Just click and get your PDF.

ANDY MONFRIED WRITES ABOUT MEDIOCRITY, SHOWERHEADS AND RAISING KIDS

Andy Monfried connects mediocrity, shower heads at his gym and new age child-rearing theories in a neat little post. I especially liked this...

It was a great lesson in life -- whether as a little kid, with a bunch of six year olds - we won or lost....to our classmates. We celebrated victory,(with a Slurpee from 7-11) and understood defeat. It taught us how to STRIVE FOR VICTORY, but be a good loser.

Today, amongst six year olds in our town -- EVERYONE WINS.  There is no loser .... they are all told (the kids) at the end of the game, "its a tie."

Read the complete post here. The comments are pretty good too.

Learn how to wage and win battles for market share.
Download the free PDF preview of the Art of Attack. Just click to get the PDF. There are no forms to fill out, you don’t need to leave your email address. No annoying questions to answer. Just click and get your PDF.

TOBY BLOOMBERG ASKS: IS THERE SOMETHING ROTTEN WITH CGM RESEARCH?

Toby Bloomberg of Diva Marketing interviewed Bill Neal the well-respected market researcher about the relevance of customer generated media as it relates to marketing research. Bill is a class guy and Toby did a good job framing the questions. This exchange was particularly enlightening as to Bill's take on consumer generated media:

TB: You've been around the research block a time or two and have seen many changes in the industry in terms of methodology. The latest concept is to use consumer generated media to gain insights into consumer behavior. Do you think that "listening in on the raw voice of the customer" has merit?

BN:It’s always a good thing to listen to the voice of the customer, in every form. That’s one of the main mandates of marketing research. And it’s our job to take those many voices and make some sense out of it all – call it insights.

But I have some real problems with consumer generated media as a source of credible and reliable information. In many ways it combines the worst elements of non-scientific research – self selection and advocacy – both positive and negative. That is, those out there in the Internet world who are generating their own media are self-motivated to do so and are not representative of any defined population of buyers. And, given the fact that they have taken a public position on a particular product or service, it means that they more often than not have exceptional or non-typical attitudes about those products and services.

The information they generate may be true, or not true – there is now way to discern which. Therefore, the information generated by those folks is neither credible nor reliable. So, as researchers, yes, we should be listening, but we must be very cautious and skeptical about its veracity and its usefulness.

Max Kalehoff who is a word-of-mouth "evangelist", VP at Nielsen BuzzMetrics and a new marketing practitioner offers a caustic yet interesting rebuttal to Bill's point of view. This is Max's opening salvo to Bill answers:

Hi Toby,

Thanks for bringing Bill Neal into the fold -- because he is well respected, as well as someone who needs to be inducted into the world of CGM. I just wish he learned more about the subject of CGM before making so many broad, INCORRECT assertions. I believe he owed that to your readers and his followers (which is a hefty bunch, to be sure!).

In fact, I was so moved by how off base I believe he was, I dedicated my last weekly MediaPost column to it -- along with concurrent blog posting. I would like to invite you, Bill and others to a virtual Skypecast discussion to debate the issues of CGM research -- an educational, good spirited discussion. You should hear from a few of us shortly. In the meantime, here are key points from my post:

http://attentionmax.com/blog/2006/06/is_there_really_something_wron.html

If you can get past Max's obnoxiousness he makes some good points about how early adopters are relevant and shape the conversation according to their passions. In a recent posting I attempted to frame the debate between the "old" and "new" marketing doctrines.

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A POT OF COFFEE AND SOMETHING TO CHEW ON...

are typically my instructions to the person on the phone taking my room service order for breakfast. Which is why when Seth Godin gets all excited because,

"my insanely complex OCD breakfast was exactly the way I ordered it. This was possibly a first."

I make a note to never have breakfast with Seth.

Have you ever been out to eat with somebody who's always bitching and sending stuff back? I hate it. And I think most other folks dislike it as much as I do.

I also think this is emblematic of the problems with so-called modern marketing and it's small gaggle of over-zealous practitioners who try and foist their Martha"esque" design, service, participation standards on the unwashed masses. 

Bottom line is that it simply doesn't matter to most consumers who don't bitch, won't participate and can't create. Just give 'em good stuff well made and they'll be happier than a pig in shit.

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A DIFFERENT VIEW ON THE UTILIZATION OF MILITARY METAPHORS

An ongoing topic in this blog is the use of military metaphors for marketing campaigning. You can read more here of what has been said in prior entries. So it was with interest I read a paper written by Anthony Judge titled: "Enhancing Sustainable Development Strategies Through Avoidance of Military Metaphors". He presents a thorough, well researched effort that offers the most exhaustive list of alternative metaphors I've ever seen. If you're troubled by the use of military metaphors or you're seeking alternative metaphors to communicate with, his paper is well worth the read. Here is the introduction:

There is a desperate worldwide search for sustainable development strategies and for the appropriate means for their implementation. To a large extent such strategies are elaborated and presented through the use of military metaphors. In discussing the associated challenges of communication, great emphasis is placed on "target audiences", "targets", and "targeting" in designing "campaigns" and "mobilizing" resources. Typically in slide presentations, notably those enhanced by Microsoft's Powerpoint software, strategies are structured in terms of "bullets" -- which are also characteristic of the documents in support of such presentations.

The question asked in this paper is whether such simplistic language is adequate to the challenges of communicating complex insights in response to complex environmental issues -- or of eliciting the support of partners vital to the success of such initiatives. Furthermore, there would seem to be a strong possibility that such language is based on mindsets and frameworks that were fundamental to the generation of the problems that sustainable development strategies purport to address. In this sense use of military metaphors may contribute directly to inhibiting and undermining any useful implementation of such strategies.

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CREATIVE USES OF COMPETITIVE INTELLIGENCE TO GAIN NEW CLIENTS FOR LAW FIRMS

Larry Bodine blogs about a conference for sales and biz dev staff from law firms. One of the presentations made by Doug Hoover talked about creative uses of competitive intelligence to gain new clients:

Hoover said law firms should start by creating the basic spreadsheet of clients, ranked by revenue or profits, and list out columns with all the practice groups of the firm.  In each cell, you plug in the revenue collected from that client. But revenues can be misleading -- they can show a client as being; but this may be because the client's revenues were down, and meanwhile the law firm has increased the share of client wallet and solidified the relationship. It should be scored as a winner. External data should be added to each cell: which other law firms represent the client and what legal work they are doing. It may turn out that a client has no work for one of your practices. You may find there is a lot of work and it’s being distributed to many firms; Hoover said, the perhaps your firm can take away from your competitors. Hoover recounted how an East coast firm was planning to open an office in Los Angeles.  It did a lot of insurance defense work and had established relationships with insurance companies.  Their strategy was look up the top 10 insurance carriers clients, and find out which lawyers in Los Angeles had represented them.  The firm shortened the list by cross-referencing the lawyers with any other firm clients they had worked with.” The list of lawyers is the hunting list of lawyers they were trying to poach, he said. Competitive intelligence increases your ability to penetrate a new market.

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DELL COMPUTER: TEXTBOOK EXAMPLE OF THE VULNERABILITY OF INDUSTRY LEADERS

The New York Times today had a good piece on Dell. In fact the article is a text book example of an industry leader under attack by more adept competitors. Kevin Rollin's offers the following:

When pressed for an explanation of why revenue growth has slowed drastically and why profits have fallen, his explanation is short. "We got a little too far ahead on profit, and that allowed competitors to sneak in," he said in an interview at the company's headquarters here, referring to Dell's profit-margin goals. "Our competitors got better, and that allowed them to get strong."

Back in April 2005 I commented that:

"Lately Dell and his lieutenants have been on a bragging crusade" as evidenced by Steven Levy's 02.21.05 column in Newsweek titled "Steamrollered by the Dell Machine". Don't get me wrong, I think it's fine to celebrate success and even taunt the competition now and then. But you should never, ever tempt fate. Which is what the boys at Dell seem to be doing...

Consider fate tempted.

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HAS CARLSON MARKETING DISCOVERED THE SECRET TO MINIMIZING MARKETING CAMPAIGNING RISKS?

The folks over at Carlson Marketing claim to have discovered the secret to minimizing the risks associated with marketing campaigning. This according to their latest white paper which is available for download at their web site. I have selected several sections from the paper to comment on. Their claims are in italics my comments in regular type.

Marketing is a risky business. Anyone who’s ever pulled the trigger on a major marketing campaign with no real guarantee of a return can certainly relate.

Agree 100% with this. Any form of campaigning is full of uncertainty. The skilled campaigner is one who can exploit uncertainty.

Despite all the efforts at market and product research, customers are hard to read, and they don’t always respond to offers the way marketers expect them to.

Agree 100% with this. Customer rarely react rationally or with logic.

It’s probably no coincidence that CMOs have the shortest average job tenure among all C-level  executives, according to executive search firm Spencer Stuart.

The reason CMO's have the shortest tenure is because they do not generate results.

Risky business, indeed. But it doesn’t have to be that way. By borrowing risk analysis techniques from the investment and risk management world, it is possible for marketers to gain control.

Huh? Marketers can gain control by borrowing risk analysis techniques? From the financial world?

Risk analysis gives marketers the opportunity to simulate and forecast the effects of various marketing efforts on consumer behavior and translate those effects into tangible returns such as revenue, corporate growth and profits.

Ok. But in order for the analysis to have any validity I need to accurately forecast customer behavior.

It gives marketing decision makers the opportunity to know the likely impact of their initiatives ahead of time.

Oh. You mean kind like those fortune tellers?

Sound complicated? Not at all. The process centers on building financial models that connect customer behaviors to financial outcomes, i.e. customer acquisition, growth and/or retention.

Ok. So I'm going to model customer behavior which is impacted by several million different variables, almost all of which I have no control over, which take place over time, are modified by known and unknown competitors who rarely act in a predictable manner, and this isn't complicated?

I'll stop here. I think you can see where this is heading. Anybody who attempts to model customer behavior and then stakes their job on the accuracy of this model is... is... well, they're an idiot. Further, any CEO or CFO who demands this sort of predictability is an even bigger idiot.

Stop and think about this for a second... assume you’re the coach of the LA Lakers. The owner comes to you and says coach I want you to tell me before the game starts, what the final score will be. Further, I need you to tell me which players you’ll play and how much playing time they’ll each get along with their points scored, number of fouls and turnovers. Also, I want to know every play you’re going to use including the order of the plays utilized. Last, I need you to tell me this by quarter - and your job depends on how accurate you are at predicting this.

As farfetched as this may seem, it illustrates the expectations and practices which drive traditional advertising and marketing doctrine. Expectations described by the requirement to budget in advance all campaign activities down to the pennies and practices dominated by rigid planning and execution methodologies which are nearly impossible to modify during the course of a campaign. Based upon these expectations marketing professionals have evolved the competencies necessary to support this doctrine.

It may seem as if embracing uncertainty means throwing all fiduciary caution to the wind. By suggesting that we have to embrace uncertainty in order to maximize effectiveness I am not saying that we need to decrease financial accountability. Instead of BUDGETING we talk about FRAMING which is a different approach to allocating and managing enterprise resources.

Traditional campaigning efforts utilize budgets to allocate and manage resources on a micro scale. Rather than talking about a campaign budget we talk about the campaign frame. Budgeting assumes we work in a predictable stable environment. Framing assumes we operate in an unpredictable, volatile environment. Budgeting hampers the ability to improvise and adapt. Framing allows maximum agility. Budgeting is driven by quantitative measurements. Framing is driven by human, subjective interactions.

The components that make up a campaign frame are: an objective, an estimate of time to accomplish the objective, an estimate of the total resources necessary to achieve the objective and a calibration process that continuously evaluates progress. The critical difference is that the calibration process replaces the budget process. Results are judged not on budget accuracy but on campaign effectiveness. Calibrations allow campaigners to evolve and adapt to changing threats and opportunities in real time.

Campaigning is an art. The art of campaigning is driven by the ability to exploit uncertainty. The primary driver of campaigning is competitiveness. Campaigning is the art of decision making, leading, and motivating people and their organizations into action to accomplish missions; visualizing current state and future state, then formulating concepts of operations to get from one place to another at least cost; assigning missions, prioritizing and allocating resources, selecting the critical time and place to act, and knowing how and when to make adjustments during the fight.

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DAVID STROHM, GREYLOCK VENTURE CAPITALIST EXPLAINS WHY THEY DON'T INVEST IN AMERICANS.

Today seems to be the day to dump on venture capitalists. I just got done describing the irony of Guy Kawasaki's approach to investing when C/NET posted a real gem from David Strohm, a general partner at Greylock. David indicated that "In the vast majority of companies I look at today, the leaders are Israelis, Indians, Chinese, Finns, Danes. They aren't coming out of the American culture".

He goes on to suggest that the main reason for this is that many U.S. college students are going to work for Wall Street and hedge funds where they service somebody else's legacy rather than creating their own. Yea, that's right, millions upon millions of good old fashioned traditional American kids are working for hedge funds. I don't think so. David needs to spend some quality time in Milwaukee, Lansing, Des Moines and Tuscon.

The reason why the vast majority of companies David looks at today have leaders who are Israelis, Indians, Chinese, Finns, and Danes is because David and his VC brethren collectively believe that they make better managers. This little piece of VC conventional wisdom has been in place since the 80's, and continues to advocate that traditional American entrepreneurs are not smart enough to compete. The traditional American entrepreneur, with three years of college from Iowa State, running a startup in Ames, will never get to first base with a top tier VC. Not because they can't compete, not because they aren't good enough, but because VC's have established a self-fulfilling prophecy that they cannot succeed. Therefor no investment.

What David doesn't get, is that these traditional American kids have rattling around inside of them the genes from parents and grandparents who fought the wars, started the companies, built the institutions, took the risks, enjoyed the fruits and suffered the failures that today allow Chinese, Indians, Israelis, Finns and Danes access to our educational system and capitalist infrastructure. And if David and his top tier counterparts would decamp in Memphis or Charleston or Atlanta or Dallas and start investing in an "American vibe" I have no doubt in a few years that they will see startling returns.

All you have to do is Take a look at the nationalities of the Greylock team and the location of their offices and then you'll begin to understand why they don't fund Americans. (SIDEBAR:: A while back I penned The Guru Red Manifesto a collection of 52 practical truths I have assembled over a twenty-five-year career as an American entrepreneur. Little nuggets of wisdom I've picked-up from competing on the front lines of entrepreneurship that speak to many of these issues. You can grab a free PDF of The Guru Red Manifesto over at the ChangeThis web site. Guru Red was in one of the first batches they published back in 2004 and for some odd reason, despite it's political incorrectness has consistently stayed in their top ten business manifestos. Go figure).

Greylocks approach is reminescent of comments made by Carly Fiorina who after getting ousted from HP joined the board of Taiwan Semiconductor Manufacturing Co. as an independent board member. I'm not sure why, but this on top of her infamous proclamation that "American's do not have a God-given right to jobs" just doesn't sit right with me.

Do I think that Americans have a God-given right to jobs? Of course not. But I do think that good American folks like Carly and David have an obligation to focus 100% of their time and efforts on increasing America's competitiveness. Not Taiwan's and not China's. Yea I know it's a quaint, naive, protectionist viewpoint for some, but for me it's a core value that I can't shake.

And as reported in the Wall Street Journal a while back, Stanford awarded 88 Ph.D.s in electrical engineering last year. 49 of these went to foreign-born students. I'll bet the majority of the foreign-born students returned to their home countries in order to increase the competitiveness of their home countries. For which I commend them. Stanford on the other hand...

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AXIS OF EVIL: VENTURE CAPITALISTS, INVESTMENT BANKERS, B-SCHOOLS, FUND MANAGERS...

I have never been a fan of venture capital, especially "well educated, well-heeled" venture capitalists. There is a genuine axis of evil consisting of venture capitalists, investment bankers, "elite" b-schools, and pension fund managers who monopolize resources, platforms and bandwidth to the detriment of real innovators and entrepreneurs. So I found the following from Guy Kawasaki full of irony:

I am a third-generation Japanese American. My family moved here to drive a taxi and clean white people’s homes. If I had a choice between funding someone from a family who moved here from Vietnam whose father and mother run a 7-Eleven versus a descendant of a Mayflower passenger with “IV” in his name, I’ll give you half a guess as to my preference. You need to encourage smart, hungry, and aggressive people to immigrate from around the world. And to do that, you need good schools. To mix several metaphors, if you want to cover your ass, you need to open your kimono because trust-fund kids don’t make good entrepreneurs.

The irony in Guy's statement is that the vast majority of VC's are the guys with IV in their name, and the vast majority of investments are made in guys with IV in their name (or the equivalent Stanford/Harvard MBA). What Guy and his VC brethren continue to miss, are the millions of smart, hungry, and aggressive unhyphenated and undenominated Americans living in places like Iowa, Illinois and Michigan. Having said that, I do think that Guy is probably one of the few top tier VC's who will genuinely reach beyond the normal Silicon Valley deal. Any VC who plays hockey at lunch can't be all bad.

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BRITIANS TESCO WAGING AND WINNING MARKET SHARE BATTLE AGAINST WALMART.

This from the Wall Street Journal...

When Wal-Mart Stores Inc. entered the British market in 1999 by buying a chain of stores here, many expected it to dominate. Instead, Wal-Mart's largest non-American operation has been struggling recently, and its top local rival is thriving.

That rival is Tesco PLC, Britain's largest retailer. Its big weapon is information about its customers. Tesco has signed up 12 million Britons for its Clubcard program, giving cardholders discounts in exchange for their name, address and other personal information. The Clubcard has helped boost Tesco's market share in groceries to 31%, nearly double the 16% held by Wal-Mart's Asda chain, according to market-research firm Taylor Nelson Sofres.

Read the complete WSJ article here.

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DETROIT TOOL AND DIE MAKERS INNOVATING NEW METHODS TO SURVIVE DOWNTURN

As many of my current relatives and recent ancestors owe their livelyhoods to the auto business, I am always delighted to see progress being made in Detroit's fight for survival. It seems now, according to a piece in the Chicago Tribune, that tool-and-die makers are innovating in ways unheard of in most businesses. A coalition of 17 firms have joined up to try a new business development formation that will "break old habits" and "turn profit without undercutting selves". The article is here.

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HOW TO DEAL WITH COMPETITORS WHO CHEAT...

Click here (yup, it's work safe).

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VSENTE'S ARMORY: WE'RE RECRUITING FOR OUR CUSTOMER ROUNDTABLE

We're assembling a customer roundtable. If you are currently a subscriber to the Armory (or have been in the past) I'd like to find out if you might have an interest in becoming a member of our customer roundtable. The purpose of our roundtable is to advise us on certain aspects of the development and further commercialization of the Armory. Aspects like site usability, content, successes, failures, potential improvements, business models, marketing strategies, tactics, etc.

Since launching the Armory a little more than 18 months ago, we have achieved a modest success, enough to convince me to invest further dollars and time into the development and commercialization of the Armory. Which is why I want to constitute a customer roundtable to help guide this development. The next step in the development of the Armory is to automate the campaigning process.

We have selected the Salesforce.com development platform to build out and automate the Armory. When complete the Armory will have the functionality of a robust sales force automation solution driven by our proprietary attack engine and terrain map. It will be the first SFA solution specifically designed to wage and win battles for market share. As a member of vSente's Armory Customer Roundtable you will need to be willing to do the following:

1. Offer periodic input via email on potential ideas, strategies and tactics.
2. Try and critique various components of the new system as they evolve.
3. Be generally available by phone conference call to discuss  group input.
4. Be a customer evangelist.

I will select 3-5 customers for the roundtable. The time commitment over the next several months will not be significant - perhaps 2-3 hours per month. Your advice and counsel will be valuable and therefor I would like to offer the following in return:

1. A free lifetime subscription to the Armory.
2. Five complimentary licenses to vSente's Armory when launched via Salesforce.com (some restrictions will apply).

If you're interested in participating then I will need the following information from you:

1. The reason why you originally subscribed to the Armory.
2. Did the content help you wage a battle for market share?
3. What did you like best about the Armory?
4. What did you dislike?
5. Your name, title, company, industry.

I will select the roundtable by the end of next week. So if you're interested please forward the information to me at mike@vsente.com as soon as you can.


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IDON'T VS. IPOD: DOES SANDISK REALLY THINK IT CAN DISLODGE APPLE?

Generally speaking the least effective attack is a full-frontal assault. Whether the attack is a massive price discount or simply calling your competitor an idiot, there are almost always better, more nuanced ways to engage and dislodge a competitor. Don't get me wrong, there are times when it's necessary to punch a competitor in the nose... but not very often. We recently commented on Jonathan Tang's full frontal assault on Salesforce.com. We questioned his judgment and it appears rightfully so, as he just handed the keys of his business over to Greg Gianforte of RightNow.

SanDisk now steps up and decides to take on Apple and it's IPod franchise with this totally in your face effort. Any attack, whether direct or indirect must be thought out three moves... your opening move, your competitor's response, and your counter. While SanDisk's effort is cute I have to wonder what the strategic calculus is driving the campaign... assuming there is any. Will SanDisk succeed? Can't tell unless you know what the next moves are... if any.

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HUNTER OR HUNTED? USE VSENTE'S FREE ATTACK SCREENER TO SEE IF YOU OR YOUR COMPETITION ARE VULNERABLE TO ATTACK.

The purpose of the Attack Screener is to broadly assess the potential success of an attack from the standpoint of both challenger and leader. If you’re the challenger use the Attack Screener to gauge the likelyhood of a successful attack. If you’re the leader, gauge your vulnerability to challenger attack. Click here to download a free version of our Attack Screener in Excel format. You can vary the weighting of each question and do your own scenario testing. These are the questions used in the Attack Screener.

OFFERING                           
Quality: Who has better quality?       
Cost: Who has lower cost?       
Service: Who offers better service?       
Features: Who offers better features?

INFRASTRUCTURE            
Plant & Equip : Who has better plant and equipment?    
Technology: Who makes better use of tech?    
Policies: Who is more competitive?
Distribution: Who better utilizes channels?

RELATIONSHIPS               
Customers: Who’s better at selling ?       
Vendors: Who has better vendors?
Lenders: Who has better access to debt?
Investors: Who has better investors?
Partners: Who has better partners?
Employees: Who has the better employees?   

EXECUTION               
Leadership: Who has the better CEO?   
Vision: Who has the stronger vision?   
Innovation: Who is better at innovating?    
Reputation: Who has the better reputation?
Com/Control: Who is better at control?   
Doctrine: Who has the more aggressive?    
Legal: Who more assertive?       
Capitalization: Who has stronger balance sheet?        

Once you download the Attack Screener you can fill it out over lunch. Ask your partner, your top sales guy or your CFO to fill it out too. Compare results. It's fascinating to see the different perceptions. With the Excel workbook you can use the format we've created and modify the questions to fit your industry. Are you the hunter or the hunted?

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JOHN MOORE OFFERS "CIRCLE OF DISCOUNT ADDICTION" - GOOD STUFF...

Hmmmmm... this is the second post in a week linking to something I agree with John Moore about. Most of the time I find myself at opposite ends of the spectrum with John. The first post was agreeing with his take on Dunkin Donuts new strategy. Anyways, John continues with his crusade to end discount pricing. This time he takes on the car business and refers to comments made by Nissan's CEO:

During the New York International Auto Show this past week, Nissan’s CEO, Carlos Ghosn, made an impassioned plea to the auto industry to wean themselves from their addiction to discounts and incentives. Ghosn is quoted as saying, "Incentives are an insidious, confusing carousel that no one seems willing to get off.” He went on to say, "You'd be hard-pressed to name another industry so reliant on discounts." [SOURCES: NY Times article and CBS Marketwatch article]

We share John's distaste with runaway discounting. He put together an interesting exhibit called Circle of Discount Addiction that is worth a peek. (Note to John.. not sure the connection of "war room" to discounting. Perhaps you can elaborate?)

We have been very vocal in our criticism of the folks running marketing for Detroit. Here's a few recent postings:

GM SALES AND MARKETING CHIEF MARK LANEVE: RUMORS HURTING SALES?

WHAT YOU DIDN'T HEAR FROM GM AND FORD AT THE DETROIT AUTO SHOW

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WONDER IF YAHOO'S SUSAN DECKER THINKS WE SHOULD CUT AND RUN IN IRAQ TOO?

John Battelle over at Searchblog is hosting a conversation about Yahoo CFO Susan Decker's comments about surrendering to Google:

"We don't think it's reasonable to assume we're going to gain a lot of share from Google," Chief Financial Officer Susan Decker said in an interview. "It's not our goal to be No. 1 in Internet search. We would be very happy to maintain our market share."

Looks like her white flag waving pissed-off some of the boys working in the trenches at Yahoo. And come to think of it her comments sound a lot like those being made by Ford and GM.

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

GEORGE PARKER IS EXPANDING HIS EMPIRE: HIDE THE CHILDREN!

True to his British roots George Parker is expanding the empire. George, who is old enough to have experienced the real Bobby Short and young enough to terrorize the poisoned dwarf, has launched a new blog and inked a new publishing deal. Good on you George! Now, please get the bar piece done would you? For those of us who still enjoy real whiskey and barroom brawls we have been looking forward to your  “The Balls out Book of Advertising.” A lethal combination of advertising expertise, cocktail recipes and reviews of bars I have been thrown out of around the world. I

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

FRESH GLUE, BEING REASONABLE AND JACK YOEST ACKNOWLEDGE MANEUVER MARKETING COMMUNIQUE...

Over the past several weeks several bloggers were nice enough to acknowledge the Maneuver Marketing Communique. Jack Yoest and Noah Kagan named us one of the best marketing blogs of 2005. Marc Babej at Being Reasonable included us in his list of amazing people for 2005 and Fresh Glue mentioned us in their list of the "gang of fourteen" blogs they track and read. Thanks guys. Always nice to be acknowledged by those you respect.

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

WATKINS MANUFACTURING, SUSAN STRIBLE AND ADTRACK: CREATING EFFECTIVE MARKETING STRATEGY

Nice article at BtoB online about Watkins Manufacturing, producer of HotSpring Spas, the No. 1 selling brand of portable hot tubs in the world.  Seems as if Marketing Programs Manager Susan Strible called in AdTrack of Cedar Rapids to help track their advertising spend.

Dan Rogers, AdTrack’s VP-corporate development, said he locates CAM’s effectiveness in its unique capability to "intercept the lead, no matter what the source." While most companies handle lead management with a patchwork of internal tracking and outsourced fulfillment, AdTrack centralizes the whole process under one roof. All data on incoming leads are captured on a hosted Web site that can pinpoint their source. Leads are then electronically profiled—including those that may be valid but not yet ready to buy.

The bottom line, Strible said, is that Watkins now knows exactly which parts of those advertising dollars are effective and which are wasted. "AdTrack," she said, "has given us a direct way to associate a sold-spa with the specific ad buy that generated it."

Ms. Strible is our kind of marketing manager. I wish BtoB would publish more of these nut and bolt case studies.

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

ROOT MARKETS: SETH GOLDSTEIN AND LEWIS RANIERI TRY TO SECURITIZE INTERNET LEAD GENERATION

Perhaps one of the most precious resources in any enterprise is a lead. A bona fide prospect for the product or service you sell. Generating leads is a core competency for any enterprise. And the ability to generate better leads than your competition is one of those enteprise traits that separate winners from losers. Seth Goldstein is the founder and CEO of Root Markets a start-up attempting to change the way leads are generated. This is how Seth describes his concept:

    1     Wall Street Meets Madison Avenue
    2     Problem: Marketing is Inefficient
    3     Solution: /ROOT Markets is a Financial Exchange for Consumer Leads
    4     How the Securitization of Mortgages Opened Up the Housing Market for Consumers
    5     How the Securitization of Internet Leads Will Open up the Attention Market for Consumers

So what Seth is trying to do is set up an "exchange" allowing marketers to bid for leads. His pitch seems to focus on the notions that marketers will be willing to hand-off this core competency to a third party and that marketers will be willing to enter into a auction environment in order to compete against their adversaries for these leads. This how Seth defines a lead:

A lead is generated when a consumer clicks on an ad and is directed to a landing page—a web site that collects information critical to determining how valuable a potential customer is—and fills out a form. This form includes both contact and intention information about the consumer.  This lead is then sold to an advertiser, who contacts the consumer to close the sale.

And this is the "exchange" Seth envisions for selling these leads:

An exchange provides a context for giving and receiving.  It is a simple concept that solves hard problems, frequently in financial contexts: stocks, bonds, commodities, currencies, etc.  In these markets, exchanges provide price data and quality information about the underlying commodity.  Successful exchanges work hard to stay out of the way of market participants.  This means encouraging liquidity without providing any:  jujitsu not sumo.  With access to this data, traders with many different agendas can meet on the same, level playing field and compete.

The Root Markets folks are hoping that marketers will be willing to hand-off lead generation to them based upon the following rationalization:

Similarly, companies (ie the buy-side) can concentrate entirely on developing better products and service.  Their marketing groups can focus on creating and communicating their brand images, while their sales organizations can simply specify the kinds of customers they are looking for and the prices they are willing to pay; the Media Futures market will take care of the rest.

Lewis S. Ranieri the controversial bond trader who turned turned home loans into tradable securities in the 70's and 80's is part of the Root Market brain trust. I am skeptical of most attempts to use technology or financial engineering to improve the efficiency of sales and marketing processes. At this point call me a skeptic on Root Markets for two reasons: we'll never turn over lead generation to a third party, and we'll never enter into an auction evironment against our competitors to bid for leads. In fact we see substantial competitive vulnerabilities resulting from marketers participating in the exchange. We'll be following their progress.

 

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

MEMORIES OF MARSHALL FIELD'S: WSJ'S AMY MERRICK PENS A BEAUTIFUL TRIBUTE

If you grew up in the midwest Marshall Fields probably holds a special place in your heart. It does (did) for me. The Wall Street Journal's Amy Merrick reflects on what Marshall Field's meant to her grandmother and generations of Chicagoans as the department store gears up for its last Christmas under that name. It's a beautiful piece of writing. Her article should be a primer for all the "new" marketing folks trying to crack the code on customer loyalty (hint: look at "old" marketing).

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

THE GREAT MADISON AVENUE BRANDING RIP-OFF

Bob Bly the legendary copywriter is hosting an interesting conversation about branding. This from the entry:

Is Madison Avenue ripping off its clients?

Yes, according to my friend Richard Armstrong, one of the top freelance copywriters working today.

His premise is that the ad world’s emphasis on branding is misguided – and that branding is only one of many factors (and not the most important factor) in selling.

Visit Bob's blog here to read the entire conversation.

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

MARINE CORP COMMAND AND CONTROL DOCTRINE AND WHY MARKETERS SHOULD BE INTERESTED...

The Art of Attack specifies a new organizational structure for marketers called an Attack Engine which aligns and projects sales and marketing competencies. The Marine Corp command and control doctrine influenced the development of the Attack Engine. In MCDP 6 - Command and Control, the Marines describe their version of command and control which is quite enlightening and applies directly to marketing and sales campaigning. The Marines describe two forms of command and control called mission and detailed. Mission command and control is designed for unpredictable, rapidly changing situations requiring decentralized organizational structure and front-line decision authority. Detailed command and control is designed for predictable, static situations driven by a centralized hierarchy. Here is how they describe the difference between mission and detailed command and control:

Detailed C&C assumes war is deterministic and predictable. Mission C&C assumes war is probalistic and unpredictable.

Detailed C&C seeks order and certainty. Mission C&C accepts disorder and uncertainty.

Detailed C&C tends to lead to centralization, coercion, formality, tight reign, imposed discipline, obedience, optimizing, ability mostly at the top. Mission C&C tends to decentralization, spontaneity, informality, close reign, self-discipline, initiative, cooperation, “satisficing”, ability throughout.

Detailed C&C communications are explicit, vertical and linear. Mission C&C communications are implicit, vertical and horizontal and interactive.

Detailed C&C organizations are mechanistic and bureaucratic. Mission C&C organizations are organic and ad hoc.

Detailed C&C leadership is authoritarian and telling. Mission C&C leadership is persuasive and delegating.

Detailed C&C is appropriate to science of war and technical, procedural tasks. Mission C&C is appropriate to the art of war and conduct of operations.

Most enterprises and specifically sales and marketing organizations operate with a detailed version of command and control.(2) The attack engine is based upon mission command and control because it embraces uncertainty, and empowers organic, ad hoc organizational structure.

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

SETH GODIN NICKS DOOR-TO-DOOR SALESMEN...

Seth Godin decides that when a business becomes a commodity you can either struggle or re-invent. He misses a third option. You can compete. Fight for share. Thrive. And use the commodity business to generate the cash flow necessary to innovate new products, services and markets. The event that caused His Godiness to kvetch this little bromide was the appearance of a real honest to God door-to-door salesman at his Irvington offices. This is Seth's rendition of the encounter...

A door to door salesman just walked into our offices in Irvington.

Tough job.

A job usually reserved for people selling advertising or janitorial services.

This was an assistant Vice President at Citibank. He's wandering the halls, door by door, trying to sell business checking accounts.

Clearly, all that marble, all those tellers and all that advertising is not enough to meet aggressive growth targets.

Once your business becomes a commodity, you can struggle or you can re-invent. I consider door-to-door selling to be struggling.

First off, Seth could be right. Maybe they are struggling. And this guy is simply humping to meet a quota. Or, maybe this guy has figured out that none of his competitors are going door-to-door. And in this day and age a firm hand shake and real personal contact can be a competitive differentiator. Maybe he is re-inventing. After all it got His Godiness to talk about it.

11.18.05 UPDATE: Harry Joiner who's spent some time training AFLAC sales reps on door-to-door selling offer his take on Seth's take here.

11.18.05 UPDATE 2: Rick Cooper the PDA Pro has issues with His Sethness' issues on selling door-to-door...

11.18.05 UPDATE 3: The Plan Resonate folks ask "Why is it so fashionable to openly hate on salespeople?"

BatsigtinyCreative awards are meaningless if you can't convert them into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

FINLAND? THE MOST COMPETITIVE COUNTRY ACCORDING TO WEF?

The World Economic Forum recently released it's Global Competitiveness Report. Finland was deemed the most competitive nation on earth. The US was second. Sweden was number 4, Denmark 6, and Norway 7. Britain was 13, China 49 and India 50. Placing Finland, Sweden, Denmark and Norway on the same playing field as the US, China, India and Britain is like mixing apples and oranges. That is if you're using the real definition for competitiveness. But the WEF has their own take on competitiveness. Forbes had this to offer on WEF's methodology:

"Finland is given high marks for prudently running budget surpluses in preparation for the future claims on its social security, pension and health care systems expected to be incurred as its population ages. The WEF also says that Finland and its neighbors may show that it is not the burden of taxes that makes for a good or bad economy, but how well the money raised is spent."

Two comments: 1) Finland running surpluses to pay for future social services (as opposed to investing in technology, infrastructure or programs designed to increase Finlands share of the global market) diminishes their competitiveness; 2) higher relative tax rates designed to generate surpluses to pay for social services (as opposed to lowering tax rates to encourage investing in technology, infrastructure or programs designed to increase Finlands share of the global market) does not increase Finland's competitiveness.

Increasing brand awareness is meaningless if it can't be converted into revenue, profit and market share. Click here to learn more about vSente. We wage and win battles for market share.

SUN TZU, THE ART OF WAR AND COMPETITIVE STRATEGY

CantrellsuntzuPerhaps the greatest weakness found in marketing organizations today is the lack of strategic insight. The ability to develop and execute effective strategy in the face of mounting competitive pressure is a requisite enterprise competency.

Robert Cantrell at the Center for Competitive Advantage has developed a unique methodology for applying the theory of Sun Tzu. Consisting of a book and a deck of cards Robert's methodology is an elegant catalyst for generating strategic alternatives. This is what they have to say about the card deck:

The core value of the Art of War Sun Tzu Strategy Card Deck is in the content.  It is absolutely the most concise summary of competitive strategy available on the market.  It summarizes, in approximately 1600 words, information about all aspects of conflict strategy that other authors, in traditional books, easily use over 100,000 words to describe.

The most common way buyers use this product is as a tool to think through options.  In that role, it serves as a sort of 'strategy playbook.'  And just like the plays of a football game, the drive to the goal line may involve a series of strategy plays, one setting up the other until you succeed.

The cards are compact, easy to fit into a packet or briefcase, and can be reviewed in their entirety prior to any critical engagement – to to include those points in travel when you have to turn off all electronic equipment.  Provided you and other parties each have their own copies, the cards also provide a common strategic language.

Trainers will find the the Art of War Sun Tzu Strategy Card Deck useful as a tool to teach all aspects of competitive strategy.  This training is backed up by a book, Understanding Sun Tzu on the Art of War, that has already found a place in the top US military leadership schools.  (The study guide page shows the linkages between the cards and the book.)  Also, the game Art of War Assertion brings many valuable aspects of strategy to the training environment that cover all functional and psychological aspects of competition.

Trainers that run war games will particularly enjoy the cards for the randomness card format presents.  Need your adversary to do something unexpected?  Pull a card and deal with it.   

We are in the process of developing some joint offerings with Robert and his group. You can visit their site here for more information and to purchase the book and card deck.

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MILITARY METAPHORS: IS BUSINESS WAR?

When we developed the positioning for the Armory and the Maneuver Marketing Communique we knew that the extensive use of military metaphors and concepts would be met with a fair amount of criticism. Marketing over the past several years has become dominated by a blue state of mind which is intolerant of all things deemed politically incorrect.

The positioning you see in the blog and elsewhere on our web sites has evolved over several years and hundreds of conversations with staff, partners and associates. Many counseled against the use of military metaphors because of the potential for criticism and ridicule. Their point being why alienate somebody if you don't have to? A point well taken.

But the reality is that most of the theory that drives vSente's campaigning methodology has it's roots in military strategy and specifically an area of thought called maneuver theory. Attempting to hide or disguise this would be less than genuine and dilute the power of the theories and contributions.

The father of maneuver theory is the ancient Chinese military philosopher Sun Tzu. The essence of maneuver theory is the ability to shape the competitive landscape to your advantage and the disadvantage of your adversaries. The best practice of maneuver theory results in winning without fighting. Which by itself is delicious with irony when confronting critics of war metaphors...

At face value maneuver theory has much to offer marketing campaigning - especially if it holds open the opportunity to better a competitor without engaging them directly. As a marketer I first began applying maneuver theory to marketing campaigns back in the late 80’s. I was attracted to the concepts of maneuver theory because of my need to get more done with less money, quite often against larger better-provisioned competitors.

What I discovered as I read more and more about maneuver theory were the many similarities between military and business campaigning. Here are several examples:

a. Activity. Business and war are each a form of competition involving two or more adversaries striving to gain an advantage or achieve a victory.

b. Strategy. Strategy plays an important role in each activity and can determine the outcome of the conflict.

c. Resources. Both business and war face significant logistical issues that require the organization and projection of people and resources.

d. Competencies. Both the military and business must marshal and command a complex set of resources and competencies.

e. Leadership. Visionary leaders capable of driving sustainable results are critical to the success of each activity and can be a decisive factor in determining the success of the campaign.

f. Intelligence. The ability to collect, analyze and distribute competitive intelligence is paramount to both the military and business.

So is business war? Of course not. Does business share many attributes with war. Yes. Can those engaged in the conduct of both learn from each other? Yes. Is war an appropriate metaphor for business? Depends on your point of view. In our case the answer is yes.

We have been seeing an increasing number of folks finding our blog and web sites after googling sales and marketing military metaphors. I'm not sure why that is, but the point of this entry is to offer why we have chosen this form of metaphor to communicate who we are and what we do. There are two military related resources I would direct critics of war metaphors to in order to gain an understanding of the topic you're criticizing.

The first is the Denma translation of Sun Tzu's Art of War. They have written an excellent explanation of the real meaning of the Art of War in the their forward titled Applying the Art of War. The second resource is John Boyd's monograph Organic Command and Control in which the maverick fighter pilot outlines his approach to building agile, cohesive, motivated and empowered organizations.

So if you review these resources and still think military metaphors are bad at least you're criticism will be from a informed point of view. But as marketers if you're simply kvetching PCisms then you're missing s significant body of thought that just might hold the key to you greatly improving your own campaigning skills.

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600 REGISTRANTS FOR THE ART OF ATTACK WEBINAR

Webinarimg2We did a webinar on April 21 with Eloqua, the demand generation folks.

More than 600 registrants signed up. Which was about three times their normal sign-up rate.

The webinar provided an introduction to the art of attack.

The slide deck, presentation notes, and case study used in the webinar, along with a replay of the webinar are now available.

Please send me an e-mail including your name, company name and a brief description of your business and we'll get you a copy of everything.

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DO NOT HIRE ANY GENERAL MOTORS MARKETING REFUGEES

GM today was downgraded to junk by S&P. You can bet your bottom dollar that not much will get done today within the GM marketing ranks. Most of whom will have spent their day getting updated resumes out. Scott Sprinzen the S&P analyst who led the downgrade effort chalked up the problem ...

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STEVE JOBS, APPLE, ICON AND NOW THE NEW YORK TIMES

Steve Jobs has created a firestorm of a controversy. Why? Because he has the audacity to fight back. Two recent Jobs related events has the intelligentsia worked up to a frenzy normally reserved for the French attacking George Bush. The first event was Apple suing a web site for publishing Apple trade secrets. Second event was Apple pulling Wiley books off of Apple's bookshelves in retaliation for their publishing iCon - the Kitty Kellyesque hatchet job on Jobs.

See the intelligentsia really hates it when a target fights back. These folks are generally cowards which is why they seek careers in the media and academia (see photo below).  They generally prefer their prey hog-tied and muzzled. And it really makes them nervous when somebody fights back. Until recently the intelligentsia had the playing field to themselves. Targets of their scorn where helpless to fight back because of flawed PR doctrine (which advocates taking the high road and not fighting back) and because they controlled the media outlets.

Things have changed due to many enterprises realizing they need to fight in order to survive, and because legitimate internet driven alternatives to the main stream media now allow a target to get the real story out. But I digress... back to the Apple story. Let me summarize the two events that have the intelligentsia inflamed:

1. Somebody at Apple leaks competitively sensitive trade secrets that are published on a web site. Apple sues to protect it's proprietary rights.

2. Two authors with dubious motives publish an unauthorized bio full of accusations from anonymous sources accusing Job's of being a con man. Apple politely bans the books of the publisher in response.

Please notice Apples measured response to the Jobs' book. Apple did not attack the authors. They did not attack Wiley the publisher. Apple simply made a statement by banning the books. I mean why would anyone continue to do business with somebody enabling this kind of personal attack?

By the hysterical ranting coming off of the blogosphere you would think that Apple and Steve Jobs Apple184had committed an actual war crime. Even the New York Times with a lull in their Iraq coverage have decided to apply their own convoluted logic to the Apple episode. The New York Times includes the photo at left which seems to depict one of the books authors cowering behind a post. Click here and you can see a Technorati watch list of developing stories about the book and Apples response. By rough estimates about 90% of the coverage I've seen is against Jobs. So what does this mean?

It means Apple will sell more iPods, G5's, and Tiger OS's. Apple was right to ban Wiley's books. And to sue the web site. All the sound and fury generated by the intelligentsia will simply add more energy to Apple's side of the competitive equation.

The Apple faithful who are bitching are simply kvetching bad PR doctrine. And you need to remember that a sizable portion of the Apple faithful are the creative lunatics who tend to favor the anarchist side of the continuum.

Those Apple faithful claiming they'll buy the book in protest of Apple's actions will demur when confronted with the choice to buy the book or the new Dave Mathews album off of iTunes. Do you really think any Apple customer will turn in their 15" PowerBook G4 for a Dell because Steve Jobs did what was right? Do you really think the graphic designer living life large in a loft South of Market will not buy the new G5 because Apple protected it's trade secrets?

So what is Apple's follow-up move? Nothing. Sit tight. Do not allow Wiley titles back on the shelf. See that's the move that offers the most leverage. Will Wiley sell a few more copies of the Job's book because of this. Sure. But the sales they'll lose from not being able to sell the rest of their catalog will put a nice little dent in their corporate coffers. And more importantly give pause to the next publisher evaluating a hit piece proposal on Steve Jobs.

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GEORGE SHAHEEN EQUALS ROGER SIBONI: WHY SIEBEL WILL BE SOLD FOR SCRAP

The problem with most CRM vendors is they continue to sell technology solutions to IT guys rather than guns and ammo to the sales guys. The CRM industry was single-handedly built in the late nineties by Tom Siebel on the basis of his skill selling technology solutions to IT folks. Once enterprise CEO's figured out that all this technology wasn't paying off, the CRM industry started it's long painful swan dive.

Hiring George Shaheen by Siebel is doomed to failure. George Shaheen, the Arthur Andersen alumnus, is the mirror image of Roger Siboni the Epiphany Chairman and former KPMG COO. One day Roger will win the award for having done the least with the most based upon his Epiphany tenure. The problem with both of these boys heading up CRM vendors is that they don't get sales. They don't like selling. They're intellectually superior to the average sales guy and REALLY do not like rubbing elbows with the unwashed masses.

Sales Force Automation spawned Customer Relationship Management when the marketing nannies decided that selling was bad and putting the customer in control of your enteprise... good(?). Problem was they left profit and ROI out of the equation, which generated all the ill will we see today and Siebels fall from grace. So what's the answer? How does Siebel right itself? For that matter how does the CRM industry start growing again?

The answer lies in a simple combination of competencies and a slight tilt to the business model. Siebel needs to acquire a major advertising agency and go to market as an expeditionary campaigner selling customers and market share to needy sales managers. Combining top drawer technology competencies with world class creative orchestrated by brilliant marketing strategy (that's where we come in) will re-ignite the company and the industry.

Now here's the fun part. George would never think of this. And more importantly could never execute on it. Tom Siebel could, but I think he's out to pasture for good. Which leaves this space wide open to smaller competitors looking to alter the balance of power within the CRM industry. Time to let the dogs run...

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MICHAEL DELL, KEVIN ROLLINS AND STRATEGY VS. EXECUTION

Lately Dell and his lieutenants have been on a bragging crusade as evidenced by Steven Levy's 02.21.05 column in Newsweek titled "Steamrollered by the Dell Machine". Don't get me wrong, I think it's fine to celebrate success and even taunt the competition now and then. But you should never, ever tempt fate. Which is what the boys at Dell seem to be doing...

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BEST PRACTICES: CUSTOMER ACQUISITION VS. CUSTOMER RETENTION

I began hearing customer retention rationalizations back in the late 70's. We sales folks were being told that it was cheaper and easier to maintain an existing account as opposed to prospecting and closing a new account. This rationalization was driven primarily by the costs incurred in pursuing new customers that were theoretically not needed to service existing accounts. Costs like advertising, travel and entertainment. The accountants loved this rationalization...

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AGGRESSIVE PURSUITS: The Big Four Accounting Firms

104040Sarbanes-Oxly has unintended consequences. Which is to be expected when dealing with complex issues. One of these consequences has been the reluctance of the Big Four auditing firms to audit smaller, publicly-traded enterprises. According to a study done by Audit Analytics, and brought to my attention by Nick Wreden at FusionBrand, the Big Four  have been dropping smaller clients like flies...

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HOW TO GET YOUR CEO TO APPROVE YOUR MARKETING BUDGET

The attacks on marketing accountability are gaining momentum. B2B magazine continues to do a good job of presenting both sides of this issue. In their latest edition they have a front page article titled Getting Reorganized in response to these increased pressures. One of the outcomes of this increased scrutiny has been CEO's unwilling to continue...

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MEG WHITMAN, EBAY AND A SWARM OF MARKETING LOCUSTS

Ebay has maximum pricing power. The nature of it's business model combined with it's dominant market share presents Ebay with unique opportunities to maximize margins. If Meg Whitman and Bill Cobb do not leverage this advantage then they need to be replaced. So with great interest I have been following Ebay's recent attempt at raising prices. I applauded their initial move to raise prices on their basic store subscription and to also increase the final value fee.

The announcement of the price increase was met by a major outcry from the Ebay customer base. Which is to be expected. I can't remember the last time a customer thanked me for raising prices. And when I do raise prices I get nasty letters, phone calls and some customer will depart. But they tend to come back when my competition raises his price or goes bankrupt because he didn't. When you raise prices you have to have the balls to fight the fight.

Because of this outrage Bill Cobb the newly installed CEO of North American operations rescinded part of the price hike this past Sunday. I'm unable to read why without insight into Ebay's strategy. There are two possible explanations for this. First, the kinder gentler swarm of marketing locusts got to Bill and somehow forced him to listen to the customer and rescind part of the increase. Or, second, this was always in the cards - a bone to throw if the natives got restless. I hope it's the latter. Either way it's going to be interesting to watch the next couple of moves by Ebay. Here are a couple of other takes on the price increase. The Liberal Order  here. The Motely Fool here.

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OGILVY MATHER, SHONA SEIFERT AND CUSTOMER DELIGHT

Ogilvy0107Ogilvy & Mather is involved in a nice little knife fight. Seems as if Ogilvy was allegedly falsifying time and billing sheets with a client - the Office of National Drug Control. Shona Seiffert, one of the Ogilvy folks on the hot seat has been caught red-handed by an FBI handwriting expert directing an underling to "put Huggies and Wings time on ONDCP".

At the heart of the issue here is a ONDCP bureaucrat named Richard Pleffner, with a history of enforcing his contracts. Several agencies who worked for the ONDCP in the past have complained about his vigorous enforcement efforts (wouldn't pay first class airfare(?), declines stretch limo to airport(?), denies $451 in-room mini-bar tab(?)) . According to Alan Levitt, the former media director of ONDCP, Pleffner "had a history of withholding payments to advertising agencies and often made contractual interpretations that made it impossible to run the campaigns"

I have been on both sides of this issue. As the client, I have had agencies screw me with false billings, and as the agency, I have had clients screw me out of earned billings (GTE was bad at this - their own employees would warn you upfront that they'd screw you). I am troubled but not surprised by the allegations leveled at Ms. Seifert. Mr. Pleffner's behavior from what I can read is not illegal and while you might debate his ethics it seems to me that he is simply doing his job.

Mr. Pleffner sounds like the type of client we quite often deal with. Most of the time they are fair, strict and focused on optimizing their side of the deal (and sometimes they are bloody, fucking, crooked assholes that need to be outed). The good Pleffners of the world do not care if you donate 1% of your profit to world charities. They don't care if your blog demonstrates transparency and your kindler, gentler side. They don't want to be delighted. They don't buy the marketing horseshit. The good Pleffners of the world want results and they want you to honor your deal. I'd love to get Pleffner's side of this (without the attorney filter)! If you'd like information on how we execute campaigns click the engage campaign link below.

UPDATE: DOWNLOAD SHONA SEIFERT'S Proposed Code of Ethics for the Advertising Industry

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NO PAIN, NO GAIN: FIVE STEPS TO GAIN RESPECT FOR MARKETING

Len Gingeralla is a professor at St. Edwards University and managing partner of Management Senior Advisors. He just wrote a piece offered over at the MarketingProfs web site that offers some very pithy advice to marketers: This cracked me up because of how right he is:

"Ever witness a marketing planning session when the chief executive asks, "What will I get for the $100,000 ad?" Or, "What percent of new business will this campaign buy me?" When questions like this are asked, you can hear a fly burp...."

Len offers a five-step process I think you may find of interest designed to answer these kinds of questions.

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CAN DELL MOUNT A CREDIBLE ATTACK ON HP?

I was surprised at Carly Fiorina's resignation today. I'm disappointed she didn't stay and fight. This is the first real resistance she's met since completing the Compaq acquisition. Instead of staying and defending her work, she pockets a $20 million check and leaves. I have been up and down on Carly. I didn't like the Compaq deal. I did like the way she fought and won it...

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GOOD STUFF FROM THE FOLKS AT MARKETINGnpv

The mail brought a pleasant surprise today. The folks at MarketingNPV are producing a free journal they publish six times annually. You'll recall I wrote about MarketingNPV a while back. They focus on the application of six sigma methodologies to the art of marketing. In this edition, which I read over lunch, is a thought provoking piece titled "Is It Time for a New Marketing Organization?". I highly recommend you sign-up for a free subscription. They also offer the journal on-line.

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EPIPHANY: POSTERCHILD FOR THE CRM INDUSTRY?

EpiphEpiphany released their latest results last week. Once again they lost money. Epiphany has yet to make a single penny. In fact Epiphany has lost more than $3.5 billion since it's inception back in 1997. I have long been a major critic of the CRM industry. Why? Wrong rationale. Wrong solution. Wrong target. Wrong people. Case in point... Epiphany.

It is important to emphasize that Epiphany is in the business of helping companies to acquire, service and retain customers (as opposed to selling sophisticated machine tools). They're suppose to be GOOD at selling. Epiphany develops the technologies that help companies generate revenue. The management team at Epiphany is a Who"s Who of American business including:

  • Roger Siboni - Chairman of the Board - Epiphany. He was also Epiphany's CEO. Before Epiphany he was COO of KPMG and is on the Advisory Board of the Walter Hass School of Business at UC Berkeley.
  • Fred Anderson EVP and CFO of Apple Computer. Member board of directors Epiphany.
  • Mohan Gyani, Former President and Chief Executive Officer, AT&T Wireless Mobility Group. Member board of directors, Epiphany.
  • Paul M. Hazen, Chairman, Accel-KKR. Former chairman and CEO Wells Fargo. Member board of directors, Epiphany.
  • Robert L. Joss, Dean of Graduate School of Business, Stanford University. Member board of directors, Epiphany.
  • Doug Mackenzie, Partner, Kleiner Perkins Caufield & Byers. Harvard MBA and member board of directors, Epiphany.

So of course all this BEGS the question of why can't Epiphany sell it's own stuff? Why can't Epiphany make a profit selling it's own stuff? Remember Epiphany has burned through more than a billion dollars cash trying.  And six years after going public the best they can muster is $20 million per quarter and massive losses. While the management team and board members continue to take home six figure salaries on top of the $100's of millions they made off of the IPO. What's going on here? Where is the adult supervision? Better yet where is the pride?

One possible explanation for this performance can be found with their management line-up. If you take a look at their management team you will notice that they have all sorts of titles and executives. But nobody who is responsible for sales. Literally. Look at the web page for yourself. You will will see no EVP Sales. No EVP Biz Dev. No sales manager. Nobody responsible for asking for the order!

Tomorrow, February 8, Epiphany will be presenting at the Merrill Lynch Computer Services and Software Conference. Their presentation will be at 3:15pm Pacific time and available here for webcast. I have two questions I'd like to pose:

1. How do you expect to sell stuff when you don't have anybody responsible for selling stuff?
2. After burning through more than $1 billion in cash shouldn't a company selling revenue technology be selling more than $20 million per quarter? Please explain.

I'll let you know if I get an answer back. But I wouldn't hold my breath.

Disclosure. I have an ax to grind with the folks at Epiphany. They cost me at least seven-figures back in 2000 when they acquired one of my clients. What started out as a $40 per share transaction ended up at $4. But hey, whats a few million dollars between friends? Grrrrrrrrrrrr.

UPDATE 09.12.05 I've been watching CNBC's coverage regarding Oracle's acquisition of Siebel. Almost all the analysts are cautioning that Oracle will be sidelined while they digest Siebel. Marc Benioff over at Salesforce.com sent an email to employees claiming this is an opportunity to take share from Oracle. If this was any other competitor I would agree with Benioff, but in this case, based upon how quickly and efficiently Ellison integrated Peoplesoft, I predict that Larry and crew will strip, lube and reassemble the remaining parts of Siebel faster than a Marine grunt stripping and cleaning his M16 before heading into a Faluja firefight. In fact, I wouldn't doubt if Oracle started to immediately heave a few broadsides at Saleforce.com. Look for Oracle to destroy the low-end of the on-demand business model. And migrate the pricing and offering upstream. More on Siebel, Oracle and E.piphany:

SIEBEL SOLD FOR SCRAP - GEORGE SHAHEEN FULLFILLS VSENTE PREDICTION IN RECORD TIME

GEORGE SHAHEEN EQUALS ROGER SIBONI: WHY SIEBEL WILL BE SOLD FOR SCRAP

EPIPHANY: POSTERCHILD FOR THE CRM INDUSTRY?

LARRY ELLISON, ORACLE, PEOPLESOFT AND A BRILLIANT MERGER

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JEFF BEZOS: HOW TO THINK COMPETITIVELY

Business 2.0 interviewed Jeff Bezos of Amazon in their December issue. The topic was How to Think Competitively and Bezos had some interesting thoughts. The interviewer framed his first question on the basis that Amazon had always gone into highly competitive businesses... Bezos disagreed with this set-up:

I think that's the wrong way to think about it. We made the choice a long time ago that we were going to be customer-obsessed rather than competitively-focused. And that's a choice. There are a lot of very successful companies that are competitively-focused, and there's nothing wrong with that strategy. In fact, one type of competitive-focused strategy that can be very effective is called "close-following," and it has a lot of advantages. You don't have to go down as many blind alleys. You watch and let a competitor go down a bunch of blind alleys, and when it finds something successful, you try to copy it very quickly and out-execute them.  It's a perfectly valid strategy - it just happens not to be who we are.

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FIGHT OR FLEE? WHEN MARKETERS NEED TO COMPETE

Recently I've noticed a slew of marketers resigning from their positions.  One thing they all had in common was the fact they were departing companies experiencing some form of minor duress - losing share, maturing technology, budget reductions, minor controversy, etc. None were fired. They where leaving voluntarily, ostensibly to spend more time with their family, pursue personal interests... blah... blah... blah, highlighting a current issue I have with marketing in general which is the absence of competitive instincts (not to be confused with personal survival instincts).

What happens when you don't have extraordinary people, innovative products, extraordinary customer experiences and rock solid infrastructure (as described by Tom Peters)? As marketers what do you do when you're dealing with regular folks, mediocre products, OK customer experiences, and infrastructure held together with spit and baling wire (in other words 99% of American enterprises)?

What happens when you don't have the cash or the competencies of a Fortune 500 enterprise to buy the media, create the ads, bring in the consultants, train the masses, attend the seminars, do the off-sites, implement the technology and get the certifications?

What happens when you don't have 18 months to wait for a branding campaign to work?

What happens when you don't have $500,000 to pay for new CRM technology?

What happens when the CEO says we need to grow or die? And as a marketer the tools, resources, competencies and capital you think you need are out of reach? In other words how do you play the hand you've been dealt? Not the hand you wished you had?

Many marketers when dealt this hand polish up their resume and start looking for a new gig. They flee. Which is interesting because quite often it was their dysfunctional marketing strategies that led to the situation they're fleeing. I am seeing a growing trend, that is disturbing to say the least, of refugee marketers looking for new territory to plant their flags on.

Rather than fleeing, marketers should be staying and fighting. But for many marketers who chose this profession because they like to attend award ceremonies, plan parties, write white papers, go on photo shoots, get wined and dined by Donnie Deutsch, be socially networked, and culturally connected the whole notion of fighting is quite distasteful.

The best place to generate new sales is by taking market share from your competition. Why? Because the risks are minimal, customers are trained to write checks for your type of products or services, you know where the customers live and how to reach them, you can start winning new business tomorrow, and you do not have to front precious resources on bet the ranch branding initiatives, new product launches, new market introductions, technology initiatives etc.

But to do this you need to compete. Why? Because your competition will likely resist. And the customer will need to be convinced to change. You need to have a desire to win to play this game, and a laser-like focus to maximize YOUR company's revenue and profit. You have to make the absolute best of the hand you've been dealt. You have get up earlier. Work later. Make more calls. Be smarter than your competition. Faster than your competition. And execute better than your competition. YEA! Lets go kick some ass! 

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THE NEW YORK TIMES AND BLUE OCEAN STRATEGY

Nyt_2William J. Holstein, the Armchair M.B.A. columnist for the New York Times interviewed the authors of Blue Ocean Strategy. Two comments made by the authors during the interview caught my attention. First:

Q. Why don't you think American companies are doing a good job of strategic planning?

A. Mauborgne: They are always benchmarking the competition, in terms of cost and quality. That means they will tend to compete head-on within existing industry boundaries. That's bloody. Strategic planning is usually focused on numbers rather than getting out of existing boundaries to leave the competition behind.

RESPONSE. The reason why you benchmark competition in terms of cost and quality is not to compete head on. The reason you benchmark competition is to develop strategies that DO NOT require you to compete head. Ironically, if the authors spent time with Sun Tzu's Art of War they would discover some fascinating insights into winning without fighting. Second:

Q. Are you suggesting that breakthrough innovations are not just trial and error?

A. Mauborgne: Absolutely. We should never see innovation as a random process. That's not the way to do it. Silicon Valley has a huge failure ratio. There should be a systematic, repeatable pattern that maximizes opportunities while minimizing the risks.

RESPONSE. Innovation is a predictable process? inspiration is a predictable process? I don't think so. Attempting to corral these spontaneous activities into predictable repeatable processes will kill the creativity and run-off the personalities and archetypes who drive real innovation. Instead embrace uncertainty and exploit the outcomes.

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DOES MARKETING REALLY NEED A NEW LANGUAGE? - PART 2

Peter Fisk provided a well-reasoned response to my comments on his and Hamish Pringle's effort to develop a new marketing language. Below is his response. I'd like to encourarage all marketers to weigh in on this topic. Send me an e-mail or leave a comment below.

Firstly, thanks for taking the time to consider the customer capital provocation, and secondly, congratulations on a great website! Im sure we agree on almost all, but here are some thoughts in response to your points:

1. Marketers are already perceived as being out of step with the rest of the enterprise. Will not a new language simply increase and/or highlight these differences? - agree, however our feedback is that its the functional marketing jargon (eg advertsing recall, brand equity, channel throughputs, response rates, referal rates etc etc) which antagonise people - whereas someting simple like how many customers, etc is indisputable language which makes sense to everyone and isnt functionally remote.

2. Will a new language be perceived as a means for marketers to recast or mask failed branding and CRM initiatives? - I hope not! I hope it will bring it back down to earth - "so how many more customers will stay because of the brand, and how much more will they pay" - one of the big challenges is to make forward-looking investments more tangible (eg spending now on brand building which may largely pay back in future years).

3. There are four existing metrics that can be used to measure marketing effectiveness. They are market share, sales revenue, operating margin and budget. These metrics are familiar, unambiguous, honest, and accurate. - agree totally, these should still be the core metrics, and I will make this clearer. Its more about understanding the things that drive these. I spent alot of time researching how investment analysts work out whether to invest in companies or not - ultimately they are seeking to project future year cashflows. Todays performance is a starting point, then they want evidence in terms of how the company will out/nuderperform their sector in future years - eg by having strnoger brands, premium prices, higher growth rates or whatever. More generally you might be interested in my broader thoughts which you can read at my websites

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DELL'S BOTTOM LINE NEGATIVELY IMPACTED BY MARKETING COMMUNICATIONS (?)

Dell_1Lana Rigsby, the talented, highly-decorated designer made a comment regarding Dell's (her client) ability to roll out new products. I've been trying to track down somebody at Dell who might shed some light on the accuracy of the comment...

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LARRY ELLISON, ORACLE, PEOPLESOFT AND A BRILLIANT MERGER

Orclmcurve_copyLarry Ellison is playing hardball. Back in June 2003 we wrote a strategy brief characterizing Oracle's opening move on PeopleSoft as brilliant. Last month they closed the deal and officially took over PeopleSoft. Craig Conway was fired. Dave Duffield resigned and the Oracle folks are systematically digesting PeopleSoft. This is no merger of equals. There are no flowery proclamations. Just a very workmanlike approach. There are many who decry Ellison and Oracle as mercenary. But at the end of the day I predict that this will be one corporate merger that actually works. It is interesting to compare Larry Ellison's approach with Carly Fiorina and her tenure at HP. Click here to get a copy of the original strategy brief.

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DOES MARKETING REALLY NEED A NEW LANGUAGE?

Hamish Pringle and Peter Fisk are advocating a new language for marketing (Hamish is the Director General of the UK-based Institute of Practitioners in Advertising). Messrs. Pringle and Fisk along with many of our marketing brethren feel that a new language is needed for marketers to communicate to non-marketing audiences. I applaud their effort. Any effort that leads to better communications between marketing and the enterprise is welcomed.

A new web site has been established by Pringle and Fisk to advance their thinking which they have titled Customer Capital. Their notion is that customer awareness, customer preference, customer affinity, customer numbers, customer yield and customer retention should be used to determine Customer Capital. The purpose of Customer Capital according to Pringle and Fisk is to create a simpler, more consistent, more acceptable language by which marketing can articulate the value it creates...

A driving force behind the creation of this new language is the ability to properly gauge and describe the real value of longer-term intangible marketing efforts like branding and customer loyalty initiatives. Importantly, they also want this new language to be embraced by the financial community who have been alienated by efforts to date. Pringle and Fisk have invited other practitioners to contribute to the development of this new language which you can do at the web site here. I have three quick comments to offer:

1. Marketers are already perceived as being out of step with the rest of the enterprise. Will not a new language simply increase and/or highlight these differences?

2. Will a new language be perceived as a means for marketers to recast or mask failed branding and CRM initiatives?

3. There are four existing metrics that can be used to measure marketing effectiveness. They are market share, sales revenue, operating margin and budget. These metrics are familiar, unambiguous, honest, and accurate.

Rather than marketers creating a new language why not embrace existing metrics already in use and trusted by the enterprise? Instead of creating a new language how about identifying new methodologies and approaches that might properly gauge the value of longer term efforts using trusted metrics? 

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BLUE OCEAN: HOW TO CREATE UNCONTESTED MARKET SPACE AND MAKE THE COMPETITION IRRELEVANT

BlueoceanLate last fall I received an e-mail from Harvard Business School Publishing announcing a new book. The title of the book was so compelling I immediately paid $6.00 to download an excerpt and read more. What compelled me were the breathtaking assertions in the title that you can create uncontested market space and make the competition irrelevant. The folks at HBSP tend to be a reserved lot so I figured there must be fire under this smoke. This is how they described the book:

Since the dawn of the industrial age, companies have engaged in head-to-head competition in search of sustained, profitable growth. They have fought for competitive advantage, battled over market share, and struggled for differentiation. Yet, these hallmarks of competitive strategy are not the way to create profitable growth in the future. In a book that challenges everything you thought you knew about the requirements for strategic success, W. Chan Kim and Renee Aubergine argue that cutthroat competition results in nothing but a bloody red ocean of rivals fighting over a shrinking profit pool. Based on a study of 150 strategic moves spanning more than a hundred years and 30 industries, the authors argue that lasting success comes not from battling competitors, but from creating "blue oceans"--untapped new market spaces ripe for growth. Such strategic moves--which the authors call "value innovation"--create powerful leaps in value that often render rivals obsolete for more than a decade. Blue Ocean Strategy presents a systematic approach to making the competition irrelevant and outlines principles and tools any company can use to create and capture blue oceans. A landmark work that upends traditional thinking about strategy, this book charts a bold new path to winning the future. W. Chan Kim is the Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at INSEAD. Renee Mauborgne is the INSEAD Distinguished Fellow and Professor of Strategy and Management.

The excerpt provided more detail on both the problem and approach - but nothing I could characterize as new or breakthrough to support a claim of creating uncontested market space. In fact it seemed as if the authors were simply repackaging long held notions about market niches. Which led me to establish contact with the authors via the following e-mail:

Renee, Chan,

Mike Smock here.

I¹m the managing director of vSente the San Francisco based marketing consultancy.

We have developed and practice a form of marketing campaigning designed to attack and dislodge the larger competitor.

So you can probably guess that your Blue Ocean piece caught my attention.

Especially since we draw on many military theories for our practice and consider Porter¹s Competitive Advantage and Competitive Strategy as foundations for successful marketing strategy.

Competitive cycles today have been compressed to days and hours. All of the cases you cited were created back when competitive cycles were months and years. A blue ocean strategy could be executed with a reasonable expectation that your competition would take years to respond to you.

Today, the internet, Fedex, Blogs, etc., has reduced the vast blue ocean that once existed to a pond. There isn¹t a place you can hide or operate today without attracting the attention of other competitors. The blue ocean is actually a small pond and it is full of blood-thirsty sharks.

I would like to propose a challenge for your consideration. Have you ever done any war-gaming or strategy simulations? What I'm proposing for your consideration is a game situation that involves your group developing a Blue Ocean strategy case. My group will then develop an Attack case to see if we can dislodge you.

We have a relationship with The Alidade Group who stages war games and simulations for both business and the defense sector. This is their web

site:  http://www.alidade.net. I think Alidade would find this to be a compelling proposition. They could stage this as a full-on game with participants and observers or we could host the game via the Internet.

Any interest?

I've had a couple of interesting e-mail exchanges with Chan and will continue to pursue the notion of a challenge. Interestingly enough, Chan is also the Boston Consulting Group Bruce D. Henderson Chair Professor of Strategy and International Management at INSEAD.

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CONVERTING YOUR SALES AND MARKETING ORGANIZATION INTO AN ATTACK ENGINE

Aeb6_2The traditional sales and marketing organization is dysfunctional. Especially when executing marketing campaigns. There are three primary issues:

1) focus on rigid, hierarchical command and control, 2) emphasis on creative over strategic competencies, and 3) cultural differences between sales and marketing archetypes.

These issues result in marketing campaigns that are unaccountable and ineffective. Marketing managers typically talk in terms of brand, awards, reach, frequency, impressions and clippings. Sales managers typically talk in terms of wins, share, revenue, margin and quotas. The language and culture of these two groups are as different as are their motivations and rewards which  destroys unit cohesion and leads to isolation. The isolation is worsened by command and control doctrine that favors predictable, static situations driven by a centralized hierarchy. Marketing intelligence skills are critical competencies  missing from traditional sales and marketing organizations. The inability to generate actionable intelligence results in disorientation and uncoordinated efforts. Effective coordination is made possible by orientation - the process of converting intelligence into effective strategy and tactics. New doctrine driven by intelligence and designed for unpredictable, rapidly changing situations is required for truly effective marketing campaigns. Visit the ARMORY to find out how to convert your sales and marketing organization into an attack engine.

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APPLE'S NEW MAC MINI IS A REAL STROKE OF GENIUS

Macmini_2Steve Jobs is at it again. Today they launched the $499 MAC mini a complete computer in a box 6.5 inches wide and 2 inches tall. You need to bring your own monitor, keyboard and mouse. But thats ok. They are using the MAC mini as bait to attract all those Windows users who have recently purchased the IPod. The idea is that you buy the MAC mini, take it home, unplug your nasty PC and plug in the MAC mini. The notion is that by using the MAC mini to manage your music, photos, and other fun stuff, MAC mini buyers will step-up and purchase higher value more powerful Apple technology for their homes and businesses. I think this is a combined master stroke of strategy and execution. Also, Apple launched a new word processor called Pages. Aimed directly at the MS Word user Pages offers an easy elegant alternative to Word. Combined  the MAC mini and Pages are two potent weapons to take out Microsoft. Read more in the ARMORY about our take on how you might attack and dislodge Microsoft.

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AQUENTS SPOOF ON CREATIVE "GENIUS"

I was reading through the archives at Marketing Vox News when I tripped over a posting from October 19, 2004 that caught my attention. Aquent a creative services firm launched a spoof of its own advertising campaign which consisted of a series of video ad interviews with brilliant Video_title_bar_09creatives. Aquent described the spoof as:

"Mocking common agency management foibles and CMO hubris, the ad shows hapless creatives as their campaign gets picked apart and made into a stereotypical print ad nightmare".

I clicked on the link and was taken to the Aquent page with the video ads and a prominent button labeled PLAY VIDEO for an interview titled Arresting Approval Pain.  I clicked on the button assuming it was the spoof and an interview with Lana Rigsby of Rigsby design started to play. The interview was nicely produced and Lana was an interesting person to watch and listen to. The first part of the interview did not look like a spoof. About a third of the way through Lana starts talking about her client Dell and their approval process. She made the following statement:

... "the time it takes Dell to develop and roll out a new product is a small percentage of the time it takes to develop and roll out the communications around that product".

Her point being that the communications approval process was delaying product launches and literally impacting the bottom line at Dell. I'm thinking as I listen to her that this must be the spoof. In 25 years of agency/client experience I have never heard of a situation where the time to develop and rollout a new product was a small percentage of the time it takes to develop and roll out the communications. Especially for a company run as well as Dell Computer.

The rest of the interview was dedicated to Lana's vision of what it takes to make great creative. I replayed the video again to make sure I heard everything correctly. I did, and I was thinking these Aquent boys are wicked with such a subtle spoof. Except it wasn't a spoof. This was a real interview. The actual spoof was buried in the menu. I then replayed Lana's interview one more time to make sure I heard it right. I did. And it raised three points with me;

1. If this is true what the hell's up at Dell?
2. If it is true why is the agency making a self-promotional video out of a client's vulnerability?
3. If it is true then this is the kind of vulnerability a smart competitor could really exploit.

I have an e-mail into Dell Computer. I'll let you know if they respond.

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MARX, ENGEL, EINSTEIN AND THE ATTACK ON MICROSOFT

Mscollage_2I bought one of the first IBM PC's back in 1982. I bought one of the first Mac's in 1984. I am a long-time loyal Apple user. Over the years there have been times when I have willingly tried Microsoft products. Other times I have been forced to due to client requirements or infrastructure necessities. I have never been ...

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QUANTUM'S NEW AD CAMPAIGN FROM BUTLER, SHINE & PARTNERS

TestedbetterIf you operate a small, privately-held, innovative tape drive business, now is the time to attack Quantum's DLT business. Jackie Finch director of marketing communications and John Butler creative director at Quantum's ad agency have provided you with all the information you need to attack and dislodge Quantum...

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CHIEF MARKETING OFFICERS AND ACCOUNTABILITY

Marketers Resource Guide They're at it again. B2B recently published it's Who's Who in B-to-B in it's 2005 Marketers Resource Guide. B2B annually selects their picks of the top agencies and marketers (see my original post).  Once again accomplishments like "gained market share", "increased revenues", "dislodged industry leader", "increased margin", "increased price", "decreased marketing budget" were COMPLETELY missing from the accomplishments stated by the annointed marketers and agencies. And I do mean completely missing. Of the 40 marketers and agencies none were acknowledged for having achieved a single accountable metric.

It is interesting that in the same publication, in a article dated November 8, 2004 and titled "Marketing Accountability Demand Increases"  a study was referenced indicating that 81% of senior marketing executives said "accountability had increased in their marketing organizations over the past 24 months". Jim Speros the CMO of Ernst and Young and former chairman of the Association of National Advertisers went so far as to say "Marketing in many ways has gotten a pass from being held accountable". But the most fascinating statistic from the study was that only 59% of marketers surveyed said marketing programs must show a return on investment - which also means that 41% were still not required to demonstrate any ROI.

All of which begs the question of what are appropriate metrics for measuring marketing accountability? There are three measurements that should be used. The first is market share. The second is revenue growth. The third is margin growth. Share, revenue and margins are the lifeblood of the enterprise and every marketer in partnership with their sales organization needs to live and die based upon these metrics. So next year when B2B annoints their best marketers of the year maybe one or two might be selected because they increased market share. Is that asking too much? Do you hear me Ellis?

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WALMART UNDER ATTACK BY SMALLER SAVVY COMPETITORS

Wal-Mart made an interesting move in response to the Thanksgiving holiday shopping trends. It was reported that Wal Mart had decided going into this important holiday season NOT to drop prices and compete directly with other discounters. Seems as if this decision cost Wal Mart dearly. The Wall Street Journal in ...

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NETZERO ATTACKS AOL

AolnetzLast week I was watching TV when one of the new AOL ads came on. I like this latest batch of AOL spots because of their casting and the way they project AOL as friendly caring company. I was sipping my coffee as the AOL spot came on and even though I had seen it many times over the past several weeks I still turned to watch it. In this spot, a young mother with baby in arms ...

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CAN YOU ATTACK A COMPETITOR?

There are many uses or applications of the word attack. Attacking the Normandy beach had one meaning to Eisenhower. Attacking the Green Bay line had another meaning for Walter Payton, Mike Ditka and the Chicago Bears. Attacking a messy disorganized garage has a third meaning for a weekend warrior tired of losing his tools. Can a business enterprise attack a competitor? Of course! Although it may not always be advisable.

In his seminal work titled Competitive Advantage, Michael Porterdedicated a chapter to Attacking an Industry Leader. In this chapter, he outlines the Conditions for Attacking a Leader along with Avenues for Attacking Leaders. Channeling classic maneuver theory Porter states that the Cardinal Rule in Offensive Strategy is not to attack head-on with an imitative strategy. For some reason many of Porter's Harvard MBA alum's did not read this chapter - because if they did they wouldn't have unleashed the torrent of price cutting competitive strategies that have gutted so many industries.

A vigorous debate has erupted over the past several years regarding customer strategy. Past communiques have addressed my take on customer delight and customer-centricity. I have advocated the need to calibrate the profit trinity - customers, competency and competitors in order to optimize any customer strategy. Some have advocated a focus or priority on the customer and others either minimize or ignore competitive input. The approach is verbalized by comments like - focus on the customer - not your competition.

Market share battles are almost always between two or more competitors fighting for a customer. In Boydian terms, this conflict can be described by the need to increase my interaction with this customer while isolating my competition. There are many ways one can isolate a competitor via well timed and well placed attacks. Generically speaking we can attack price, quality and the positioning of a competitor. And as long as the attacks are credible I can begin isolating my competitors while simultaneously increasing my interaction with the customer. It is the interplay of interaction and isolation that allows me to shape the market to my advantage and the disadvantage of my competition.

My customer intimacy brethren will tell you that rather than attackingthe competition you should be embracing your customers. They would be right if it was a binary choice - meaning you could either delight your customer or attack a competitor. When executing acampaign we work off a campaign palette that incorporates actions designed to increase our interaction while decreasingour competition's. There are times when attacking the competition is necessary. There are other times went it is opportunistic.

Enterprises profoundly underestimate the concept of attack. Both from the standpoint of how to attack and how to respond to an attack. The key ingredient necessary for formulating an attackis intelligence. Which takes us back to Sun Tzu the father of maneuver theory and his insistence on knowing yourself and your enemy. Our 2-day Mobilizations are designed for enterprises who would like to attack and dislodge a larger better provisioned competitor.

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BARROOM BRAWLS AND CAPITALISM

One of the reasons why I enjoy campaigning is the competition. I would suggest that the cornerstone of capitalism is competition. And I would also suggest that when you attempt to moderate or diminish competitive instincts you blunt many of the competencies needed for innovation and survival. I am always looking for new notions about competition from other forms of conflict.

There are many forms of competition - some are simple to understand as in a bare-knuckle barroom brawl where there are no rules, to complex litigation driven by rigid rules and a code of conduct. The reason I'm mentioning this is two colleagues have come out with some interesting notions on correct and incorrect analogies for competition.

The first is Chet Richards. Chet has a new book titled Certain to Win. Chet aggressively attacks the notion of using military analogies for business. Chet comes to his conclusions as a mathematician, retired Air Force Colonel and long time Boyd associate and offers some compelling insights on the true nature of competition within the 21st century enterprise. You can find out more about his book here:

Certain To Win

The second is Dr. David Lai, a native Chinese, now a professor at the US Air War College at Maxwell Air Force Base. David and I became acquainted over our shared interest in the game of Go and it's application to strategy. David recently authored an article with Joel F. Cassman titled Rethinking the American Way of Football And War. In their article the authors suggest that European style soccer is a much better metaphor for war than American football. While their conclusions apply to military conflicts all of it crosses over to business. I think you'll find their conclusions quite interesting. You can read the article here:

Rethinking the American Way of Football and War 

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FRAMING, BUDGETING AND THE LA LAKERS

Stop and think about this for a second... assume you’re the coach of the LA Lakers. The owner comes to you and says coach I want you to tell me before the game starts, what the final score will be. Further, I need you to tell me which players you’ll play and how much playing time they’ll each get along with their points scored, number of fouls...

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DR. JOE STRANGE AND CENTER OF GRAVITY

I am continually surprised by seasoned sales and marketing professionals who believe that as long as they focus on the customer, they won't need to worry about the competition.

Understanding the strengths and weaknesses of your competition is paramount...

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ALLOCATING THE MARKETING BUDGET

Several years ago I had to really struggle breaking in a new client. The struggle was over the budget. For most campaigns there are two basic types of costs. The first...

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WARGAMES AND CAMPAIGN SIMULATIONS

We are in the process of developing a new relationship with the Alidade Group of Newport Rhode Island. Alidade is a think tank specializing in complex systems research. They stage war games for the department of defense and invited vSente to participate in a recent engagement.

War games attempt to simulate a conflict between two competing forces. The objective of a war game...

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A DEFINITION OF CAMPAIGNING

The concept of campaigning in the business arena has been distorted by two different interest groups. The first group consists of large advertisers who's notion of a campaign is a ...

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THE ART OF CAMPAIGNING

Campaigning is an art. The art of campaigning is driven by the ability to exploit uncertainty. Historically, there have been two basic responses to coping with uncertainty... minimize it or exploit it.

The group who has perhaps the most forward thinking approach to dealing with uncertainty is the military. The Marine Corps in developing there command and control doctrine embraces ...

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HOW A DELL ACCOUNT MANAGER UTILIZES O-O-D-A

Greg Swanson is Dell’s Global Account Manager for Siemens Worldwide. He is based in Munich, Germany and has also worked for Xerox, Eastman Kodak, and Cable and Wireless. Over his 17 year career, Greg has developed an appreciation for Boyd and recently wrote a white paper applying O-O-D-A to key account selling...

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SUN TZU’S INFLUENCE ON MANEUVER THEORY

Maneuver tactics were first described by Sun Tzu in the “Art of War” more than 2000 years ago. The late Samuel B. Griffith a retired Brigadier General in the U.S. Marine Corps authored one of the best translations of the Art of War. In the introduction of his 1963 translation, Griffith introduces for the first time the key concept behind maneuver theory called “shaping”. “The prudent commander bases his plans on his antagonist’s shape. Shape him, Sun Tzu says. Continuously concerned with observing and probing his opponent, the wise general at the same time takes every possible measure designed to prevent the enemy from shaping him”. Maneuver theory allows a competitor to shape the conflict whether it is the battlefield or the marketplace to his advantage - and to the disadvantage of his opponent. The ability to shape is based upon knowledge of yourself and of your opponent. Sun Tzu again this time from Thomas Cleary’s translation: “So it is said that if you know others and know yourself, you will not be imperiled in a hundred battles; if you do not know others but know yourself, you win one and lose one; if you do not know yourself and do not know others, you will imperiled in every single battle”. Griffith continues his introduction to The Art of War by describing Sun Tzu’s use of the expected and unexpected in order to generate maneuver advantage. He characterizes the use of the expected and unexpected as the “generals tactical instruments”. Griffith says: ...The normal direct or cheng force and the extraordinary, indirect or chi force - are reciprocal; there effects are mutually reproductive...

Griffith defines cheng as fixed, static and immobile. Chi is described in terms of flanking, encircling or fluid and mobile. Another way of thinking of cheng and chi is in terms of the orthodox and unorthodox. Cheng and chi like their Chinese analogs yin and yang are inextricably linked - one giving rise to the other. The emphasis on one force over the other leads to disharmony. And although cheng and chi are only two forces the artful combination of them can lead to infinite possibilities. Sun Tzu described the artful use of cheng and ch’i this way according to the Thomas Cleary translation of The Art of War: “There are only five notes in the musical scale, but their variations are so many that they cannot all be heard. There are only five basic colors, but their variations are so many that they cannot all be seen. There are only five basic flavors, but their variations are so many that they cannot all be tasted. There are only two kinds of charge in battle, the unorthodox surprise attack and the orthodox direct attack, but the variations of the unorthodox and the orthodox are endless. The unorthodox and the orthodox give rise to each other, like a beginningless circle - who could exhaust them?"