Cadillac & General Motors: The limitations of needs based selling

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Charles H. Green's Trust Matters blog is always a good read. And the relevance of his post on the limitations of needs based selling remains fresh two years later when you read it and contrast his views against the efforts of companies in financial crisis attempting to affect turnarounds. My case in point? General Motors.

A company's advertising is its mouthpiece. And no where else will one find greater expression of needs based selling than in a company's advertising. And nowhere else can one find greater evidence that absolutely nothing has changed within a company than in the way they express "our" needs - for this is how they "see" us.

Look at General Motor's advertising for Cadillac's SRX Crossover. It says this "is the Cadillac or crossover vehicles." IS THAT my need? I thought MY NEED, if I currently had one, was to see signs of life from General Motors! Proof that someone was listening! Not "proof" from Ed Whitacre that when he came to GM he "liked what he found." Ed's just not my "needs" barometer.

So once again GM offers evidence that even though someone is home no one is "listening!" Like the scene in The Hunt For Red October where the Soviet Navy is banging away with their sonar so hard they couldn't hear a submarine if it was right under them; GM isn't listening to my needs. As Charles Green says, GM is trying to drive me (like cattle) to my needs.

GM and Cadillac are still my grandfather's brands. Telling me I need "the Cadillac" of crossovers just doesn't cut it. I look at the vehicle and see a design that "looks 10 years old before it was even new." The SRX is not "a product that says smart things about me." And in all of the advanced strategy research I did for GM that GM ignored and continues to ignore, these two needs still rate higher in GM's turnaround efforts than do money back guarantees. Who wants a money back guarantee if I'm not going to consider buying the car anyway!?

Cadillac is not my gold standard. There are just soooo many other luxury crossover and SUV brands that anyone over and under the age of 54 would rather have. So how does Cadillac address this? General Motor's Cadillac Division must Socially Engineer® a reason-for-being - the posuitioning strategy - that proves the brand is once again relevant to me. Social Engineering® is a process that matches consumers via "Culturally Influential Consumer Groups®" to products based on over 500 dimensions of product compatibility GM does not possess. Social Enginnering® is not accomplished using judgement for here we see General Motor's and it's partner's cognitive bias at work: advertising based on errors in judgement brought on by the false positives of old thinking.

Being "The Cadillac of Crossovers" is a claim without substantiation. Like "branding," it's something the lawyers say you can say when you don't have anything to say. As legendary UCLA basketball coach John Wooden says, "It's what you learn after you know it all that counts." So I'd welcome a fresh round of calls from executives at Cadillac and General Motors. Just don't ask me to wait 120 days to be paid like last time. Your needs are not being met by your existing roster of vendors and strategic suppliers. They have not helped you worship at the alter of effective needs based selling.

Personal Branding - The Companies Headhunters Blackball

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Why no consumer packaged goods company has been able to market a new product more successful than the least successful new product ever created by product development expert Calle & Company and Martin Calle remains a mystery. Baked Lays Potato Chips, created by Calle & Company for Frito-Lay sold $319 million in it's first ten months. That's roughly double 2008's most successful new product conceived and developed some other way, Gatorade's $159 million G2. Can't compare salty snacks to beverages you say? Only if you want to close your eyes and believe "you" are the "knower of all things." And that's the problem with personal branding. You build alters to yourself.

Not to promote but Calle & Company's product developments have topped the charts at IRI, NPD and ACNielsen now for 57 consecutive years. And why? Because outward-looking forward-thinking executives reach out to them while straight-forward, linear-thinking problem-solvers do not. For example, while Calle & Company was working with highly talented cross functional teams at Frito-Lay to determine what consumers wanted next, others at Frito-Lay were busy pushing "supplier" concepts like Wow! Chips with Procter & Gamble's Olestra championed by Pepsi CEO Indra Nooyi. And Wow! Chips with Olestra was barely able to fill the pipeline with $29 million worth of product.

So how do you NOT end up behind the 8 ball while making your company one that headhunters respect? And what's the difference between hitting a home run and striking out? That's a good question. Many acquaintances in the human resources industry tell me they attend conferences where the main topic of conversation is the fact that even though they hire the top talent, top talent fails to deliver growth. Visiting McKinsey & Company's website one also finds in McKinsey's assessment of the consumer packaged goods industry that, "despite solid balance sheets and healthy bottom lines executives still wonder where growth will come from. So apparently, McKinsey's consultants don't have the answers either. On the internet, especially at sites like LinkedIn, one can find a host of professional organizations dealing with marketing, marketing research, innovation, social media, social networking and branding. Yet in the market research groups, especially the "Next Generation Market Research" group one finds post after post and discussion after discussion addressing my grandfather's market research techniques. If this is indeed "The Next Generation" then why are they using my father's and grandfather's marketing research tools? There's nothing "next generation" about it.

So having covered those three aspects, consider the impact of working in these companies on your efforts to personally brand yourself. Afterall, this is, was, has been and will continue to be the era of "brand me."

On September 3, 2009 Business Week published The Companies Headhunters Avoid: Recruiters are in surprising agreement as to which companies they avoid when looking for executive talent. Companies such as The Coca-Cola Company figured prominently in the article and were I The Coca-Cola Company's Senior Vice President of Human Resources Cynthia P. McCaque I'd be concerned. The Coca-Cola Company has not launched a new product that ranked in IRI, NPD or ACNielsen's top ten annual pace setters for at least the last 25 years. The article details the inability of longtime Coca-Cola veterans to manage other companies effectively, including some of The Coca-Cola Company's prior luminaries.

According to the Business Week article, "The conclusion among headhunters is that the very attributes that make Coke a great company—an iconic brand and an unmatched global distribution system—also make it too easy for young managers to rise without having to develop the entrepreneurial skills necessary to compete in other arenas." "Granted, working at Coke can make you comfortable—the stock has yielded a 24.8% total return over the past five years, vs. a 2.4% return for the Standard & Poor's 500-stock index—but recruiters say it may not make you management material anywhere else."

But read the entire article at Business Week and remember two things. It's what you learn once you know it all that counts, and, stay humble, there's always someone better right behind you. Reach out!

A New Job for The Marlboro Man

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I have been given the task to repurpose/retask/reinvent or otherwise Socially (Re)Engineer® the Marlboro Man. I can't tell you by whom but I can tell you that I always thought Ralph Lauren or Stetson should launch a new fragrance for men called "Smoke" just in time for the holidays. The ingredient? That "liquid smoke" you find in the grocery store.

The Use of Images in Market Research

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Over at LinkedIn.com I've been tracking an interesting discussion on the use of images in market research among members (myself included) of the Next Generation Market Research Group started by Ricardo Lopez, President of Hispanic Research, Inc. We've confronted the use of images in research since 1953 finding that whenever you use images you tend to cement images and emotions in place rather than promote discussion beyond those bounds and any advertising agency would agree; and so we switched to "written" creative and stimulative materials finding that they better enabled the respondent's mind to wonder/wander, the way reading a good book forces you to use your imagination and imagine a scene based on individual perceptions and frames of reference to discuss rather than have it presented as a done deal long ago. And with better business building results.

But what is the risk of using images to present ideas? Both Washington Mutual Bank (once the biggest bank west of the Rockies) and Kahn's/Hillshire Farms presented images to respondents to get a bead on how to present their brands to consumers. Both WAMU and Kahn's/Hillshire Farms showed people pictures of farmers dressed in blue jeans and flannel shirts, and scientists dressed in stached shirts and lab coats. There were a range of other images. Obviously, being based in Seattle with lots of rain, forest and hippies, WAMU was perceived to be the "friendly" bank while arch rivals Bank of America and Wells Fargo were perceived to be "those evil starched shirt corporate guys not to be trusted." Similarly, Kahn's/Hillshire Farms products were percieved to be made by honest "farmers" while Swift-Eckrich products were percieved "made and processed" by corporate food scientists in stainless steel by men wearing starched white lab coats." So which image is more appealing? And is this really insight? I think not.

Using this data, though accurate, did not move either business ahead. For friendly WAMU and Kahn's/Hillshire Farms; neither grew their customer base, sustain growth nor were they any more effective at retaining customers. That usually happens when you show people what they want to see. The wisdom of crowds it is not. WAMU got bought out by evil Chase due to its inability to weather a financial crisis and Kahns/Hillshire Farm was sold to the evil white coat guys - erasing all the research time, money and advertising spent on work that went down the drain. What a waste of career time.

Anyway, why does the practice of using images in research persist? And why do academics promote such? Because pictures in research promote what people in the medical community (doctors) call "SEARCH SATISFACTION." A condition where the care or answer givers simply stop looking for better answers when they find one that "works." So should images really be a part of Next Generation Market Research? Well?

Laura Ries Dishes on GM at Ries Pieces

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If you haven't read Laura's posts at Ries' Pieces get a move on! Her current installment on GM, called "GM & The Implication of the Opposite" hits the mark and commenting readers are posting interesting follow ups. Now, my chief strategic problem with GM's promotional money back guarantee is that it doesn't build positive business OR brand perceptions, it tears them down due to one immutable law of marketing, advertising, branding and sales. When one trades on price, your brand equity sinks so low you have to climb up a ladder to get to the bottom. This strategy is installing the "Kill Bits®" in people's minds and perceptions that depress their response to advertising, marketing, branding and sales efforts - a far cry from correctly Socially Engineering® the company and brand's turnaround. We're observing Fall of Rome calibre strategy at GM because they really don't understand their consumer and they are unwilling to listen in the ways required to give them what they want.

Tired of High Fructose Banking

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Pre or post financial crisis meltdown have you gotten tired of high fructose retail banking? You know the type of banking I mean. The one where all the ads say we're the bank for you and all the fees say the bank giveth and the bank taketh away. Well, why do I bring this up? Because the best answers in marketing, branding, advertising and generating the social influence that changes consumer habits and practices and changes consumer behavior and attitudes on a large scale are always "abstract." These solutions "are so obvious they're not obvious."

In 1971 The Coca-Cola Company commissioned me to "identify future consumption drivers in soft drinks" because no one knew what people really wanted next. By removing high fructose corn syrup from soft drinks we created a new category of beverages called New Age Soft Drinks technically defined as soft drinks with no corn syrup consumers perceived more healthful and thirst quenching aka today's Vitamin Water.

So, "abstractly," what would you have if you removed all the corn syrup from banking? Would Wells Fargo really be able to "take you to the next stage" (terrible "branding" and proof that branding is something you do when you don't really have anything important to say).

Washington Mutual was advised by me to pursue a "Give a man a fish and he can feed himself for a day, but teach a man to fish and he can feed himself, and others, for a lifetime" strategy to 1) address opportunities presenting themselves via pre-crisis banking industry deregulation, and 2) to attact depositors with higher disposable incomes to fuel growth. Because their free checking for life strategy only appealed to bottom feeders who didn't have disposable income to fuel the banks growth Washington Mutual fell to America's financial crisis - finally swallowed by Moby Chase. Score: Straight-forward, linear-thinking, problem solvers 1 / Forward-thinking, outward looking executives 0.

One hopes the current and post crisis banking industry will not pursue the airline industry's nickle and dime approach to serving customers. It's so PC - and that does not stand for  "politically correct." It stands for those great Apple ads where Apple lets Microsoft skewer itself with its own PC. One hopes retail banks will eliminate the corn syrup. Of course, if the banks regard their business as does The Coca-Cola Company, they really won't give a rats ass about you and me because the bulk of their business, like Coke's is in the commercial business, or high fructose corn syrup segment. Maybe that's why Coke's got a guy whose only claim to fame is launching his own $ 7 million frozen novelty line before he took over running Coke's global innovation business. How's this JV entrepreneur supposed to impact consumer behavior in a business where one share point is worth over half a billion dollars? Well, he doesn't - which is why the carbonated business has been in decline for 4 years and Coke outsources all of its innovation to the JV start up businesses they acquire. It's like setting up an inexperienced Tom Cruise to take on high powered Jack Nicholson in the movie "A Few Good Men." We're not supposed to win. But we can still rant like pawns.

A fructose free retail banking system would find me among their depositors in a heartbeat. I wouldn't look at their brick and mortar tellers like car salespeople. Why? Because their product, though a commodity, would remain unchanged, their "message" would exert greater social-cultural pull over my decision making processes. Of what benefit is this? The strategy, in computer programmer terms, would negate the "kill bits" that depress my response to their advertising, marketing and branding.

Grant McCracken & The Chief Culture Officer

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What do you do when you find a gap in the way companies do business? Well if you're Grant McCracken, an exceptionally bright guy and publisher of the blog Cultureby, you do something about it. Much published Grant's written Chief Culture Officer due in December at Amazon. In Chief Culture Officer Grant argues for the position of CCO in the corporation and the role culture plays in how to create a living, breathing corporation shaping decisions that make companies more valuable. Or not. There are plenty of examples of how abscence of a chief culture officer, or the knowledge that outside, outsourced utility can bring, essentially signs death warrants for companies such as General Motors or Chrysler. I exclude Ford here for they did not need a bailout. Hence their collective culture officer must have made strikingly different decisions. That alone is enough to prove Grant's premise for billions of dollars are at stake to be won or lost by the US auto industry and the having, or not having, of a Chief Culture Officer. In my mind what is the greatest challenge for a newly installed Chief Culture Officer? Getting there and actually finding a mechanism in the company that will accept your input. How can you promote the concept of the Chief Culture Officer? Join Grant's Chief Culture Officer Community.

What's my personal spin on getting culture into and out of a corporation? Getting people to use it. I'd sold the use of our "Culturally Influential Consumer Groups®" for purposes in market research to corporations such as General Motors for years. My biggest supporters in GM's top tier strategic office promoting this work and their roles of Chief Culture Officers were on one assignment Paula Travenia who had communications research oversight of Buick and agency McCann-Erickson and Marina Shoemaker who had strategic communications oversight for all of GM's brands. They liked the work and hired me again and again...but alas, no one was going to save GM single handedly (and that caveate was provided time and again by Marina who kept building her arsenal of Cultural Influence Knowledge on her brands). Should their resume or CV cross your desk you will find yourself in contact with two of the sharpest Chief Culture Officers on the planet.

Another early adapter of getting cultures into and out of a corporation was Procter & Gamble's Paper Division President, Dick Nicolosi who hired us to get a better "cultural" handle on the Pampers brand.  Pampers thought the only reason people purchased disposable diapers were for reasons of ‘fit’ and ‘dryness.’ You had to ‘fit’ the baby better and keep the baby ‘drier.’ And as retailers began dropping Pampers from their shelves, P&G executives wondered what they could do to retain distribution and reverse the downward trend in the company's share of the disposable diaper market. Calle & Company’s proven Social Engineering® process enabled consumers to turn Pampers into the ‘developmental’ diaper brand. Pampers, re-launch as Pampers ‘Phases’ Developmental Diapers convinced moms that being a toddler was just another ‘step’ or ‘stage’ in the ‘development’ of their infants and newborns. By Socially Re-Engineering Pampers as “the developmental brand” Pampers arrested toddlers migrating to rival Kimberly-Clark’s Pull-Ups, sustaining distribution and gaining $11.2 billion ($1.2 billion per year) in diaper sales over the next ten years.

Now THAT'S being a Chief Culture Officer. And why do I single out THIS example? Because I always thought that a corporation's MOST effective CCO SHOULD be the CEO. How many times had I called a company asking for the person most interested in better understanding their product's customers; or asking for the person in charge of innovation driving the growth of their business in the "packaged goods" industry only to be shunted to some guy named Phil in packaging design? "Oh, I see. Phil in packaging design is the person in charge of innovation driving the growth of your business." Give me a break.

The concept for Chief Culture Officer has GREAT merit. My hat is OFF to Grant McCracken for so well hitting the nail on the head. Now, how do we drive it into the corporation? And more importantly, how do they put it to use for the only thing that matters? How to create more successful established brands rather than milking them with line extensions; and how to create more successful new products. I know Social Media's now all the rage, but it's not the communication channel that reaches consumers with the most import. It's the message that connects with the culture. Thanks Grant. You are a good think! I only hope the the homogenaity of the mob, the commoditization of social communities or the wisdom of crowds don't drown us out. Every crowd, mob or social community is still composed of hundreds of interactive "Socially Influential Consumer Groups®" (for a list of 500 SICGs® to consider for your business email me - use the link on the blog - if that fails, post a note here) who think their own thoughts regardless of overwhelming social pressure to conform. GM is good at ignoring cultures, making what they want then telling us it's what we need. That model no longer works. The working model is; find out what cultures want, and give it to them; and better, before they no they need it for if you only collect and gather data in real time, by the time you act you will only be reacting, a day late and pound short behind the consumer rather than the necessary procative step ahead.

The Fly In General Motor's Ointment

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I have no beef with General Motor's use of eBay as a means to move vehicles, but as a reason to buy vehicles the strategy misses the mark.

It's no secret GM wants to get rid of dealers. Work for GM's strategic top office confirmed the need to remove dealers from the loop as long ago as the late 70s and early 80s. Why? Because consumers hate the dealer experience and perceive interaction with a dealership's salesforce about as appealing as spending time with a brick and mortar bank teller. The experience really doesn't get your juices going. Bank and manage your accounts online. Also, dealers contracts are long and expensive to maintain. So, long ago, GM was clued in to pursue dealer free channels. Hell, here's my platinum card. Let me pick up my Accord or Camry at a Costco. And there's the rub.

Camry, Accord and Taurus are perceived commodities...and that's a good thing. For this strategy to work consumers need to perceive that purchasing a GM product means that you are going to receive a product that represents the coin of the realm...and consumer's benchmarks....still an Accord, Camry or Ford Taurus in the high volume bread and butter segments are not met by GM product perceptions. So casting your lot with social media maven will not impart a healthier glow to the troubled brands.

GM and it's brands need to be Socially re-engineered to change consumer habits and practices and consumer perceptions. This is not something accomplished simply by handing your account to a traditional, social or digital agency. It is a proprietary process that matches consumers to products based on over 500 deeper dimensions of product compatibility (almost like eHamony) we alone possess, coupled with interviewing or viewing these product dimensions of compatibility through the eyes of the correct Socially Influential Consumer Groups - not just demographic, attitudinal or behavioral segmentations. They are far too crude for even though we are twittering our ways to being one community the community is composed of Social Influence segments holding their own in this universe.

People say they want to purchase automobiles "that say smart things about me." A Honda does, a Buick does not. People say GM products "look like they're 10 years old before they're even new." And after seeing the new Transformers styled Bumble Bee Camaro I went out to look at a new Corvette. Did you know that in comparison, in my mind, that new Corvette now depresses me? It looks more like the last Generation of Camaro rather than next year's gotta have. Now Corvette looks 10 years old before it's new.

So if you don't have the product, no amount of new channel distribution or social media exposure is going to work...effectively. I'll bet I'm right. I mean, who wants to tweet up Cadillac? Ooppps, wrong audience, wrong generation. And Saturn? Those ads about "what pundits say (pundit is a social online word - get it?" ...and the fact that "they've gotten it right all along?" Then why does the ad follow up in the very next sentence state the company has 5 entirely new models, like the old models missed the mark? That silk shirt's kind of icky too. Not a TRUST builder. Gotta go. 1+1 doesn't equal 2 with new management at GM which is why the company still is not a member of my social economic forecasting index.

Alexa

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I want to validate or claim my Blogger Blog. I understand that because it is a Blogger Blog this has to be done manually with Alexa. There's no way to provide an email address that will work or to place an info.txt file in my root. Would you mind helping me? My Blog is called MADISON AVENUE. The Journal of Social Influence Marketing & Branding. I'll repost this and title it Alexa on my blog. Here's the info:

url: http://advertising-age.blogspot.com
site_owner: Martin Calle
address1: 18881 Patrician Drive
address2:
city: Villa Park
state: CA
country: USA
postal_code: 92861
phone_number: 714 244 9511
display_email: future@callecompany.com

Thank you!

Is Your Brand Subject To " Phantom Relevancy Syndrome?"

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In the medical world amputees are subject to phantom limb syndrome: The perception of sensations, usually including pain, in an arm or leg after the limb has been amputated. The brain still gets messages from the nerves that originally carried impulses from the missing limb. Phantom limb syndrome is relatively common in amputees, especially in the early months and years after limb loss.

So as your brand relevancy diminishes are you subjecting yourself to phantom brand relevancy: the perception that your brand is still relevant even though it is not? Now many businesses are facing diminished relevancy today and there isn't a lot of hope that they'll bounce back. So what is it that goes on in the mind of the people running these businesses that they refuse to admit their business is fading away? Is it the fact that the USPS still does over a trillion dollars a year even though it's relevancy can't compete with email and text messaging? Is it that newspapers still get away with charging people for subscriptions even when radio is free and the internet delivers the same news a day earlier? Why do these brands refuse to reengineer themselves socially even though they're following in the same steps of greatly diminished brands such as Polaroid or Kodak who became commodities in the age where we now capture and transmit our memories digitally? And what of Microsoft's Bing Search Engine or Zune MP3 player - also rans that are 10 years over the hill before they were even new. Like General Motors chasing that dying aging midwestern audience - only that audience still process images in a way that once gave these businesses the lion's share.

So is it that managers cling to their ideas more tenaciously than their most prized material possessions that prevents them from effecting change? Is that the syndicated knowledge from which they draw insights fails to accurately map the future...or continues to lead them down the path that if they just keep coming to work and doing their thing everything will be allright? Are they playing ostrich and just hoping for a sustained miracle turnaround? Or is it that a few hybrid vehicles, while still a brightspot at General Motors have not been enough to do the trick? Of course I've been preaching this is the flaw in GM's relevancy for years. Before people will respond to a cash for clunkers deal at GM, GM has to establish the bread and butter market currently dominated by Ford, Honda and others. In short, you have to build more quality into your product.

But now I drift from my purpose, to promote comment on phantom brand relevancy syndrom. K-Mart's on the cusp, as is Sears, as is Starbucks as was Pabst Blue Ribbon Beer. One step in the grave and no one's willing to admit it. How do these managers console themselves for one more day that everything is all right?