City of Paris

While retailers lament that holiday sales are still in the doldrums, retail analysts note that, this year, the economy is not the only reason for consumers to hold back. Rather, it is a lack of innovation. Other than Zhu Zhu hamsters, there are few must haves for this holiday season. The analysts note that “Cash for Clunkers” recruited consumers for auto dealers in the midst of the recession. Likewise, iPhone sales continued strong. Meantime, the Financial Times reports on the rise and fall of MySpace, and though the settings are different (notably MySpace went through a huge culture shock with the acquisition by News Corp.), the lessons for marketers are very similar.

One, tough times are not a good reason to stop innovating, which inevitably involves taking risks and, just as important, making innovation the top priority. Typically this means putting innovation ahead of short-term profits. Zhu Zhu pets come from Cepia, a relative newcomer in the toy business. The MySpace story is more complex, but the first parallel is the focus on making numbers (revenue promised to Wall Street pushing managers to make decisions that compromise customer experience). I’ve watched and experienced this irony many times in my career. Anytime profit is put ahead of customers, customers go away and so does profit.

Two, take your eye off the ball and you can expect competition to take it away from you. In many ways, it is hard to expect innovation at a time when companies, especially the smaller and medium-sized businesses, are struggling to stay afloat. And in the case of MySpace, chairman Rupert Murdoch had a huge distraction—the all-consuming acquisition of Dow Jones, the company that owns The Wall Street Journal.

This all goes to say that in our business of marketing and communications, good ideas come first, budget cuts and poor economy notwithstanding. And if we believe that a smaller budget means doing less, which means thinking less, we are conceding to competition who are willing to think harder and work smarter to get more accomplished and make a bigger impact with less.

The Heart of Power: Health and Politics in the Oval Office by David Blumenthal and James A. Morone is probably the most important book I read this year—important because of the perspective it offers on healthcare reform through a systematic analysis of how each president since Franklin D. Roosevelt attempted and largely failed at healthcare reform.

Strength in What Remains: A journal of remembrance and forgiveness by Tracy Kidder is a moving story about Deo, a young doctor who survived his native Burundi and Rwanda, only to find himself on the streets of New York.

I don’t know why I had never read The Alchemist: A Fable About Following Your Dream by Paulo Coehlo until a good friend gave me a copy this year. It’s never too late!

Inside Steve’s Brain (Expanded Edition) by Leander Kahney is an entertaining and educational account of the ways of Steve Jobs and his innovations. Treat yourself!

And finally, an oldie but goodie that I read again this year, Paris to the Moon by Adam Gopnik is an engaging and delicious account of Paris (and France) from a New Yorker’s point of view.

I had a somewhat disturbing conversation with a marketing manager last week. She was charged with revitalizing a waning product line—mature market, commoditization price pressures and unsuccessful competition for sales time. Unfortunately, the briefing took the form of a list of tactics that she had envisioned, and the list consisted of the usual suspects such as update brochure, enhance website and develop webinars. That same week, a colleague told me about a brand manager friend of hers commiserating with her about his agency, which of late has been coming up with creative concepts that miss the mark. What was puzzling to my colleague was that the agency is well respected for its work. As they spoke, my colleague realized that this was a classic case of a substandard brief that was a product of too many sources of input, a long, drawn-out but not thought-out process that resulted in a compromise. So when I saw Scott Davis’ CMOs, Regain Control of Your Destiny it seemed especially relevant. Davis cites a recent study by Prophet (the consulting firm led by David Aaker) and the Association of National Advertisers that, among other things, found that the majority admitted to spending most of their time on tactics such as budgeting and “being guided by a short-term marcom plan.” Quoting CMOs from leading corporations across a number of industries, Davis’ advice boiled down to (a) partnering with other members of the management team to help champion marketing’s role, (b) bringing insights to conversations with senior management (which of course requires taking time on a regular basis to think strategically), and (c) thinking and speaking growth not marketing, which parenthetically also means less reliance on marketing speak. On this last point, I couldn’t agree more!

As to my “all tactics” client, I got the buy-in of the director of communications (Davis’ advice [a] above) to spend some time taking a look at the market and speak to the stakeholders within the company and with key customers before delving into the relaunch. That will enable me to offer my client, the marketing manager, some insights she could perhaps share with her management—advice (b) above. And, last but not least, to me, thinking about growth means thinking broadly about the business and challenging not just the promotion facet of the marketing 4Ps, which was my initial assignment, but looking at defining specific segments where the product line has the highest chance for success and reassessing the channels to see if they are appropriate for today’s needs.

While pundits debate the valuation of Facebook, Twitter and other high-visibility social media sites—some wondering if there is a viable revenue model somewhere to be discovered—LinkedIn has been quietly profitable since 2007. Not bad for an Internet business born right after the bubble, in 2003. As Reid Hoffman, founder and chairman, explained in a recent interview, LinkedIn’s strategy is founded on two core tenets: unflinching focus on the needs of the target audience (the business professional) and a diversified revenue model. While other social media sites look for ways to keep their users on the site, LinkedIn understands time limitations for the business professional, and looks for ways to help people get what they need from the site as quickly as possible. But that does not preclude LinkedIn from actively accumulating details about its audience (e.g., through quick polls), which in turn improves its advertisers’ ability to fine-tune targets and messages. As to the diversified revenue model, I spend more time on Twitter, but I shell out $195 a year to be a member on LinkedIn.

My favorite marketing idea of the week:
Estee Lauder Gets Women Ready for Their Social-Media Close-ups: Cosmetics Giant Offers Makeovers and Professional Photos to Use for Profile Pictures

Excellent example of social media in healthcare:
How Hospitals Are Quietly Leading The Way With Social Media

If you are looking for statistics (also ideas for presenting numbers in a not-so-boring way):
From The Economist: Did you know?

Oh no!
Pharma Drops Search Advertising After FDA Warning
Sponsored Links Fall 84% Following Dressing Down for Violating Marketing Guidelines

Last but not least, look before you tweet:
Short Outbursts on Twitter? #Big Problem

Lately, I’ve been fielding questions from a number of young companies at various stages of business planning, fundraising, product development or commercialization. The founders/entrepreneurs usually express communication needs in terms of naming (company or product), logo design, generating awareness through press releases and, most gratifying to me, honing their messages. Another common thread is spending money wisely, since budget is limited (whose isn’t?).

When should we start thinking about names and logos? It’s good to have a company name from the get-go. It’s a rallying point for potential employees, customers, partners, collaborators, advisors and investors. Logos are a nice-to-have at this stage. I would save my money to have professionals develop a corporate identity system when there is adequate funding. A simple layout for critical items such as business cards, letterhead and PowerPoint templates will suffice for raising seed capital, planning the business or testing concepts. Focus on functionality. Product names can wait until you are ready to plan your first product launch—unless a good idea comes along serendipitously. I would advise spending a little money on trademark searches if you have a company or product name that you are planning to keep. It costs much more to undo later.

What about branding? Branding goes beyond names and logos, and it’s never too early to think about your corporate brand. In fact, this should go hand in hand with business planning, as you begin to define your vision for your company, the value your company will bring to your customers and other constituencies and how you want to conduct business. Sitting down with the stakeholders, if possible with a brand consultant, to articulate and map out your vision for your corporate brand will pay dividends many times over—but only if you do this when you feel you are ready and if you and your management team are willing to commit to following this road map. All of this will lay the foundation for developing the corporate identity system when the time comes.

What about press releases? Before sending out the first press release, take the time to think through a public relations plan. If you cannot afford the time or the resources to plan properly, it might be wise to wait. You don’t necessarily need a big and elaborate plan, but you do need to answer some simple questions (e.g., what do we want to accomplish with these press releases, who is our target audience) and some more elaborate ones (e.g., what are our key messages and what do we have to support and substantiate these messages). You’ll also need to have the basic elements in place—a media list, a press kit, internal FAQs for fielding questions, internal and external spokespeople and their respective roles, etc. Don’t shoot from the hip!

How much should we spend? How much to allocate to communications is a business decision. The important thing is to align budget with goals and expectations. Do a few things well if your budget is limited. If your budget does not allow you to hire professionals to do the job, at least recruit professionals to give you counsel and guidance. Correcting misperceptions is far more expensive than getting it done properly the first time.