Welcome to the first edition of “MARKETING IN THIS ECONOMY.”  I’m Dave McClave, and I really hope you’ll get a lot out if this series.  This edition is called “Where Your Customers Are,” and we’re going to be exploring concepts to effectively market your business, product or service in today’s economy relative to your customers.  We’ll be looking at real-world examples, rather than esoteric or academic ideas.  I’m going to introduce some ideas, not too far from what you may know, but not necessarily traditional in approach.  We’ll look at how messages and methods have changed, and how buyer’s perceptions have changed, warranting a new approach. And we’re going to talk about reaching your customer where they are, instead of where you want them to be.
A bit about me, so you know where I’m coming from:  My career in media started in the mid ’80s making radio commercials just before I became a broadcast journalist in the Navy. I then went on to work in television as a civilian, ran a successful recording studio for nearly a decade, ran a brick-and-mortar musical instrument retail store during the advent of the internet, and when I realized that marketing was the biggest part of everything I had done, I went into marketing and media production full-time.  Today, I am the founder and principal partner of a media production and consulting firm called Case42 Creative Media. I’m a published author, musician and producer, have a few minor motion picture credits, and I am periodically asked to speak and teach on various topics, ranging from media technology and publishing to business and personal success.
I grew up in the ’70s and ’80s.  As a child of the late ’60’s, I witnessed many changes in the economy; from gas shortages, recession, sideburns and mustaches, (not mine!),  in the Carter years, through big hair bands and mullets in the ’80s, continuing on through the music-scene cool-down and dot-boom bubble of the ’90s. Over the last 10 years, we’ve seen the tech market bubble-burst, gold prices have soared to well over a thousand dollars, music is now largely purchased as digital files rather than on hard media, and the Internet has become the de-facto marketing environment of this age.  Over the last 30 years, we’ve gone from the space-age to the information age to the communication age; perceptions have changed drastically, and these are important to note.  Perception IS reality, when it comes to marketing.
The topic and title of this series is “Marketing in THIS Economy,”  but if you talk to advertising pros who’ve been around for a long time, you might find a surprising number who say things haven’t changed at all when it comes to marketing. Well, they’re right, to a small extent - you still have to reach your target market and convince them that your product or service is the one they want to buy.  It’s important to note that I didn’t say you have to convince people yours is best.  A prime example is Wal•Mart - “Save money. Live better”.  Nearly everyone knows that Wal•Mart doesn’t have the best products.  Most believe that they have the lowest prices, but even people who know they don’t will still shop there just because it’s convenient.  You can get your groceries, new tires, camping equipment, a washing machine AND a new TV, not to mention your favorite DVD, and the prices you see first ARE lower.  The point is that the economic environment has caused marketing messages to change a bit, the marketing methods have changed a lot, and these 2 areas are where the old-school marketers frequently get it wrong.
I live in a DMA, or Demographic Market Area, of roughly a million people.  It’s actually a pretty small town I live in, but part of an area including 2 counties, 5 incorporated cities, and numerous smaller communities. Our demographic and psychographic profiles make our area a great test market for many major companies.  McDonald’s and CocaCola have both used this area as one of their prime test-beds for new products.  Unfortunately for businesses here, it’s also very difficult to introduce new products and services with any degree of success… and the more novel the product here, the harder it is to sell; it’s a pretty conservative area. That said, I love marketing here, because I KNOW how people will react to just about anything I do, and that’s important if you’re going to market successfully.
So, I said that the message and methods of marketing have changed, and it’s true.  If you try to market with the messages used yesterday, you’ll fail, and the same can be true with the methods.  Now, there ARE a few exceptions that can be VERY effective, but if you’re going to use an antiquated message or method, you’d better make sure you’re the only one doing it in your market, and that the message and method are unique within the past decade or so. Additionally, the message MUST match the current culture and psychographic profile of your intended audience.  One example I can think of right now is a local fruit grower using the old Burma-Shave road-sign method. This idea, which was novel when it was first presented in 1925, worked for Burma Shave all the way through the 1950s, but no one else could use it effectively then. Today, though the idea might be useful for a handful of businesses throughout the country, is too old, far too local, too identifiable as someone else’s unique method, and only works if a feeling of nostalgia in the marketing message is desired.
So, let’s talk a bit about how the marketing message has had to change throughout the years.  Some companies are able to hold on to their slogan and their message for decades without any worries.  A&W’s “Frosty Mug Sensation” comes to mind, as does Apple’s “Think Different.”  But think about McDonald’s - They’ve had more than 20 different slogans, and with them, more than 20 different marketing messages, from “You deserve a Break Today,” to “it’s a Good Time For McDonald’s” to “I’m Lovin’ It.” Their newest campaign is “What We’re Made of.”  The one consistency is that their message is always about overall experience, rather than the product.  The most recent slogan is the closest to a product-specific message they’ve ever come, but it’s interesting to note that they’ve never used negative or comparison messages, and mostly told their buying public about themselves, rather than the product.  The bottom line for McDonald’s is that they recognize that their message must change with the times and match their buying demographic, but theirs is a mild example.
A more extreme example of changing with the times would be Oldsmobile, who started in 1902 with “The Best Thing on Wheels,” and by 1930 had changed to “Sound Economy suggests Oldsmobile.” Price remained a focus until 1934, when they switched back to quality; 1935 was “A Car that has Everything,” ‘37 saw “A Beauty in Armor,” and ‘39 was “Top Flight Performance.”  Oldsmobile reached out to their buyers’ senses of quality and style with slogans like “Bigger and Better in Everything” in ‘41, and “A Famous Drive in a Famous Car” in ‘48, through “Oldsmobile Rockets Ahead” in 1950.  They maintained a rocket theme all the way though ‘58, went back to style and luxury through ‘63, then went back to the rocket theme through 1966. From ‘68 until production ended in 2004, Oldsmobile’s primary marketing message was luxury and quality.  The problem, in my mind, was that they lost touch with what their public wanted and perceived as important.  Their brand became their undoing, if you ask me.  They knew things were coming to an end in 1988, when they debuted the slogan, “Not Your Father’s Oldsmobile.” This campaign was wrong on SO many levels, but it really did mark the end of the line for them, because the brand, which lasted more than a hundred years, was tired and worn out, while they pushed harder and harder to emphasize their quality.  The late switch, saying Olds was different than the past, while presenting the same product with the same overarching theme, didn’t work.  Had they switched their message, and possibly even their product line, to reflect the general public’s attitude toward sedans, they could have stuck around maybe another hundred years.  Although their methods changed in the late ’90s and early two-thousands to include interactive media and the internet, it was too late.  I was part of one of their last-ditch efforts to market the Olds Aurora via interactive CD-rom, and I can tell you that it felt wrong at the time.  Even through the tail end and bursting of a huge stock bubble followed by recession, their focus was quality and luxury; the trappings of a successful economy.  At my media technology company, we were doing the same thing - buying high-end cars and new houses… we had survived the dot-bomb, and in our limited DMA, things take a little longer to pan-out, which means we weren’t feeling the pinch yet, but Oldsmobile was, which is why they were altering their campaign… but it wasn’t enough. When the economy finally caught up to us, we were finished, and so was Oldsmobile. I can tell you that I see what feels like the same thing with Lincoln.  Lincoln’s newest ads are focusing on luxury, power and speed.  I just saw one of their ads, and it makes me want to test drive one… though I’m not in the market for a luxury sedan.   The problem, even though I like the ad, is that the message may not be relevant for this economy, which brings me back to the focus of this series.  How DO you market for THIS economy, and avoid going the way of Oldsmobile?
The economy has slowed down… a lot.  This means people are buying less - even through recovery - so for you, the marketer, manufacturer or business owner, it’s no longer about getting a piece of the big pie.  You have to either carve out a niche or yourself, or you have to aggressively take business away form your competitors, who are aggressively trying to do the same to you. If you are selling an unnecessary, luxury or optional product or service, it’s even worse.  The fact is that buying habits are changing, and it all comes down to the perception of the buying public.
So… how are perceptions, and therefore, buying habits, changing?  If you look at marketing in the 40s and 50s, it’s almost always about quality. Value and price aren’t nearly as important in those messages, but then prices have increased faster than average incomes, so the buying public has had to tighten their belts by force.  In the ’50s, you could buy a house for roughly $5000, and the average annual income was just over $1,200, or about 4:1 price to income ratio.  Today, an average $40,000 household income has to be able to get you a $250,000 house - a 6.25:1 ratio! In the ’50s, most individuals didn’t have debt. Today, almost all do.
So, along with prices, perceptions have changed a greet deal. Today, even though people know that quality typically costs more, they’re willing to forego quality in favor of price, and a great many people are willing to give up quality in some areas in order to gain status in others.  It’s really surprising to me to drive into a Wall*mart parking lot and see $40,000-$60,000 vehicles.  Even more surprising is to see really expensive cars parked in front of tiny houses in relatively poor neighborhoods.  A former client of mine had a $70,000 house and a new $85,000 Range Rover, so everyone that met him on the street believed he was wealthy. His payment history, on the other hand, told a completely different story.
The point here is that you have to understand the motivators that influence your customer base.  Getting psychographic profiles of your market area will help a great deal, as will simply staying in touch with your customers.  If your customer base is aging and shrinking, but buying more expensive items, you may find yourself in Oldsmobile’s situation - take a look at altering your marketing model.  Don’t market yourself right out of your market, in other words.
I make a point to buy psychographic profiles of various market segments in my area periodically.  These are REALLY good to have on hand.  I get mine from a local TV station when I’m taking on new clients that may advertise on the tube.  These reports are invaluable; offering information about recreation, buying habits, motivators, turn-ons and turn-offs.  I LOVE them, and I can order reports on just about any segment I want, from people looking to buy a car within the next year to homeowners with incomes between x and y.  By using these reports in my marketing messages, I really pinpoint my target demographic exactly, and I know what to say, as well as what NOT to say.  For example, if I’m marketing luxury products in the wealthy community just to the west of our main metro area, I shouldn’t use words like “value” or “bargain,” but I’d do well to use wording that imply that their neighbors would be measuring themselves against the owners of my products.  I might even do well to imply expensive European imports, as opposed to quality American made products.  On the other hand, marketing to the farming community 2 miles away requires no mention of imported anything, and it had better be a good value for the money, gosh darn it!  So the first step in marketing effectively in THIS economy is to know your existing and desired customer bases INTIMATELY.  Know their habits and motivators, and understand what turns on their buying reflex, as well as what turns it off.
Now, you think you know your target very well, and you have the perfect message, and you’ve tested it so that you know it works… how do you reach your demographic in such a way that they’ll GET it?  I tell my clients all the time that they need to reach their audience where THEY are, not where the seller WANTS them to be, or where it’s less expensive or convenient to reach them.  You can’t convince someone to eat at your high-end bistro with ads on the hard-rock station, typically, and you can’t reach the out-of-town tourist to visit your attraction that requires planning or reservations using a billboard they see while they’re driving back home.  You must sell where people are making their decisions, and when they’re in an environment that will lead to a purchase decision, without having the effort backfire on you.  Let’s take a look at a marketing campaign example that went terribly wrong because the marketing research was conducted in the wrong environment.
Do you remember the “Pepsi Challenge?” How about “New Coke?” These two campaigns are tied inextricably together.  The Pepsi Challenge, if you remember, took place in supermarkets, and customers would taste Pepsi and Coke from unlabeled cups, always choosing Pepsi over Coke.  Well, as any smart company would do, Coke did their own tests, and found it was true - the majority of tasters DID prefer Pepsi in these tests! Now, Coke has dominated the cola market since their debut in 1886, and a HUGE portion of it is emotional attachment to the brand, another topic we’ll cover later. So what does the environment have to do with it?  In a few different critiques of the challenge over the last few years, several authors have attributed the preference to the small quantity consumed from small cups, and a few, including a former Coke marketing guy, have attributed it to environmental cognizance pollution; that is to say, the results were tainted by the environment.  It seems cola drinkers don’t typically consume their beverage of choice in supermarkets from small paper cups - usually, it’s from a can or bottle at home, at a game, or maybe at a picnic, but never in small quantities from small cups in supermarkets. Whether or not this is true, Coke didn’t see it that way, and responded with a new formula - which did well in the same sort of taste test, but bombed in sales.  So, Coke back-peddled and reintroduced “original” Coke, and their sales nearly tripled over the next few years!  The point is that the test by the competitor, and the response by Coke were BOTH outside the buyer’s normal environment.
A much better way to reach people where they are was what RedBull did. Rather than ask people what they liked in a comparison test, they TOLD people what they liked, and it worked.  Who owns the energy drink market?  RedBull, hands down. They CREATED the energy drink market.  RedBull is the only reason the others even exist.  Redbull, in a stroke of genius, hired a bunch of young DJs, students and trend-setters throughout Austria, where the company started,  to host parties where Redbull would be served, purposefully restricting supply and refusing to advertise… also pioneering viral marketing while they were at it.  THIS was a huge success, and proves that reaching the buyers where they are - where they’ll make decisions, and where impressions are encoded emotionally - is the thing to do!  I love new marketing ideas, and I love marketers who take chances - as the old saying goes, “to get the good fruit, you have to go out on a limb!”
Now, one thing I REALLY like is seeing marketers in industries that seem stuck, like the auto and chain restaurant industries, do things VERY differently from their competition.  I was involved with Amway many years ago, and one thing that always rang true with me in the rhetoric being preached by my uplink was, “if you want to succeed, look at what everyone else is doing, and do the opposite.”  I love that approach, and it’s always worked for me.
A few years ago, Volkswagen released one of their new Bugs on the web only.  You HAD to order it on the web, and they sold many months in advance of delivery. Ducatti did exactly the same thing with one of their bikes around 2000 or 2001, and sold out of the entire planned production run before a single bike was delivered. Both manufacturers had plenty of critics, but both are known for doing things their own way, as well. More importantly, both respond to and encourage the culture of their buyers.  Rather than trying to fit in with their would-be competitors, they have both pretty much ignored them, carving out niches in markets that makes their customers a lot more like fan bases than typical customer bases. A lot of great brands come to mind when I think about customer/fan-bases. Brands like Nike, Harley Davidson, Land Rover, and Apple.  These companies have built brands that create emotional ties in their customer base.  They’ve concentrated on where there customers ARE, rather than where they want them to be. And many times, they’ve even altered their product to fit a particular market, rather than market to a base that fits their existing product; a pretty novel concept in a consumer economy where manufacturers actually make a lot of decisions for the buyer by way of their sheer marketing power.
For some products, there’s almost a “mob mentality” when it comes to their favorite product, and there are great ways to capitalize on this.  The ipod is the perfect example. People who wouldn’t even think about buying one before are spending $200-plus to get one with all the features they want, load it up with apps and music, and show it off to all their friends who have last week’s model. Remember the Sony Walkman in the ’80s?
In the end, one of the most important things you can do to reach your customers “where they are” is to speak in terms they understand.  I do a lot of consulting where I help clients develop their “corporate language” packages; verbal and visual guidelines for all their marketing and communication that matches their desired customer culture.
Culture is key in the communication age.  No longer does the buying public simply decide based on the information available. They want to know who their buying from, and they want communication.  The success of Facebook and MySpace is due entirely to the advent of the communication age; people have bounced back from the cold, impersonal information age, seeking connection.  Even the info-monger, Google, has responded my personalizing search results.
So, learn the culture of your intended buyer.  Learn what turns their buying reflex on, and where they make those decisions to buy.  If you’re selling skateboards, don’t advertise in National Geographic.  If you’re selling Rolexes, don’t use terms like “sick” when you mean stylish.  This SEEMS like common sense, but you’d be surprised how many people superimpose their own culture over their customers’, and make huge mistakes in their marketing message.
Reaching your customers where they are means speaking in terms they understand, and speaking to them where they are, rather than where you want them to be.  A great example is a recent client I had who was marketing health products.  She was using media that showed glamorous, fit models.  Her wording was all about health and success and empowering people.  Her intended target, is obese Americans and she has a real heart to help people be healthier.  Now, I can tell you with all confidence that if glamour and fitness were a priority for Americans, we would’t be the obese nation we are.  Our priorities, as a whole, include convenience and entertainment.  So, where did she go wrong? She couldn’t see a better way to reach her audience until we walked through the culture and cognitive process of the intended buyer.
⁃    Original marketing message: “You’ll look good with our products.  Our vitamins will give you energy for your workouts, and suppress your appetite. See how good you can look… our models sure do look good in these active poses!”
⁃    Intended heavy customer: “I like convenience.  That’s why I eat packaged food and at fast-food restaurants.  I like my leisure time and entertainment.  I watch a lot of television and go to movies and watch sports but don’t participate, even if I want to.  Physical activities, while they might be fun, are uncomfortable because of my weight, so I don’t do much in those areas. I’d like to look better, but most people are heavy these days, so I feel just fine in public; no need to change, especially if much time or painful activities are involved.  I’m just too busy, and not really into pain or self-denial. ”
⁃    Modified marketing message: “Our vitamins are a convenient way to get the nutrition you need to feel better.  You’ll be able to accomplish more in your busy schedule, allowing you the time and energy to do the things you really enjoy.”
MAYBE, before-and-after photos of real people could be used here, but that’s a bit tired.  The point is that the message has to speak to people on their terms, not the seller’s.
This series will continue to explore marketing themes and methods over the coming installments; we’ll present some step-by-step activities you can do to capture your buying public, and set yourself apart from your  competitors, and ensuring your long term success!

PR: wait…  I: wait…  L: wait…  LD: wait…  I: wait… wait…  Rank: wait…  Traffic: wait…  Price: wait…  C: wait…