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Marketing’s Greatest Conviction

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We all have convictions. They’re the semi-conscious hunches, notions, and gut instincts that set our behavior in motion.

It’s difficult to directly observe a conviction, but it’s not difficult to observe how a conviction sets our behavior in motion. The following simple experiment will assist.

Start the video shown below, and then say out loud the color each of a series of words is printed in. Don’t say the words, say the color in which each word is printed. Everything will make sense once you get going, so start the video now.

Now you can appreciate the influence convictions wield on your behavior. It really didn’t matter what you were directed to do, when words were presented on the screen your behavior was to read them. That’s because the conviction (the semi-conscious, gut instinct) of literate adults dictates that words must be read before they can be otherwise considered.

If it were any other way, you would be able to say the color of the words whose letters do not match, as quickly as those whose letters do. What this experiment makes perfectly clear is that convictions are the foundation of behavior.

Sadly, those whose prosperity is most dependent on influencing behavior — marketers tasked with delivering success — are often the least interested in understanding how convictions influence (and often control) behavior. Marketers will do almost anything to accommodate behavior once it exists, except exploit its origin.

That’s a problem because convictions set the agenda for the very behavior marketers seek to accommodate. Marketing’s greatest conviction is simply this: Success results only when products, services, candidates, causes, and their attendant messages, parlay with the basic and invariable convictions held by customers.

This conviction has been demonstrated time and time again. It explains why White Wave’s Silk brand soy milk is a leading seller of chocolate “milk,” even though Silk contains no milk. It explains why Starbucks was conceived as a social place to drink coffee, not sell it. It explains why Apple owns the iconic mobile connection device, the iPhone.

It’s important to point out that none of the above success stories were brought about through the identification and accommodation of market segments. Knowing the demographic and/or psychographic profile of people who like chocolate milk had no bearing on White Wave’s decision to liquefy soy powered, put it in a milk carton, and shelve it in the refrigerator next to cow milk.

Howard Schultz didn’t know the ages or IAO (interest, activity, opinion) profile of any of Starbucks’ customers when he remade Starbucks, because Starbucks had no customers when Schultz remade it.

In fact Schultz is on record as saying he had no idea how many, or what class, of people would want to visit a Starbucks store. (C-Span Global Innovation Video – Watch the 4 minute segment beginning at minute 7:00 and ending at 11:10)

Consider also that Folgers, Maxwell House, Sanka, et. al spend lots of time and money trying to identify and then accommodate the whims and desires of segmented “target” markets. This differentiation process is required because Folgers, Maxwell House, Sanka, et. al are easily (and therefore often) compared to each other.

Starbucks doesn’t have to worry about differentiation because Starbucks doesn’t trade on coffee. Starbucks trades on convictions, namely those associated with human connection; a conviction that can be experienced through coffee but not compared to it. Speaking of human connection…

Steve Jobs turned a deaf ear to the “big time” consultants who argued divergence would rule the mobile phone. The explicit purpose of a mobile phone is to connect people. How “divergence” could occasion a sense of connection is nonsensical on the surface — worthy of a very different type of conviction. (Why the iPhone Will Fail)

It’s tempting to think that White Wave, Starbucks, and Apple are unique, idiosyncratic, unapproachable, one-offs, but that is not the case. White Wave, Starbucks, and Apple are no different than every organization.

There are three elements that effect success, and every organization is in direct control of two of them. The first is the product, service, candidate, cause, etc., on offer. The second element is/are the message(s) used to promote the product, service, candidate, or cause. The third element, public reaction (word of mouth, news, public attitudes, social media buzz, consumer groups’ reactions, etc,) is a direct response to the first two.

White Wave, Starbucks, and Apple aren’t unique, idiosyncratic, unapproachable, one-offs. White Wave, Starbucks, and Apple use convictions as the raw material to create their products, services, candidates, causes, and messages. That’s why they’re winners!

Winners understand that it’s pointless to tell people not to read when presented with words. Winners understand that convictions are inceptive gut instincts that spark behavior. What winners understand best is marketing’s greatest conviction. Success results when products, services, candidates, causes, and their attendant messages, parlay with the convictions held by customers.

Marketing's Greatest Conviction
November 8, 2012 by Bob Manna & Matt Manna
Version: 6C674909(R04) • Feb 17, 2014
Photo © chrisharvey – Fotolia.com

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Marketing's Greatest Conviction (PDF)

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Success Is Built On Frameworks, Not Rules

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Bookstores are in decline. So are electronics stores. As for music stores, are there any left? People continue to buy books, electronics, and music, yet the decline continues. Why?

The decline continues due to the conviction that success is a model. Those with such a conviction argue that a painstakingly crafted set of rules, derived from an analysis of past events, will guide an enterprise to future success. The term for this process is “business model.”

Change happens however and it demands accommodation. Model makers respond to change by adopting a strategy of differentiation — a process of re-tuning, re-positioning, and re-launching existing products, purported to allow an enterprise to appear as if it is adapting to change.

The model maker can think of no other way to respond because the model maker believes the future is bound to what came before. And in a way it is…

Differentiation has been around for at least 50 years, ample time for its results to be assessed. And what does the assessment reveal? The failure rate for new product entries is 80%.

Faced with this fact, the model maker is forced to lay blame not on the rules of differentiation, but on a failure to properly implement the rules of differentiation. That narrow point of view is complete and absolute nonsense. The rules responsible for past and current success are totally discordant from what can happen in the future.

What rules did Amazon adopt from the historical bookstore model to sell books? Why hasn’t Radio Shack and Best Buy been able to differentiate themselves back to their previous levels of success?

Isn’t it more likely that the future success of Radio Shack and Best Buy (if there is one) will result from discarding what worked before, in order to seek and discover what can work in the future? The obvious answer is yes! The means to do so requires an understanding of the difference between rules and a framework.

Rules are explicit controls designed to regulate behavior. A framework is the environment within which behavior exists.

The twelve notes of the musical scale comprise a framework that enables notes to be assembled in ways that convey various musical motifs. The framework doesn’t determine whether a piece of music will be considered jazz, classical, rock, etc. That determination results from the set of rules the composer follows as he or she creates music.

Also, there is no predetermined set of rules that determine whether or not a composition will be successful. Success is the result of the composer’s ability to create music that can coalesce with an audience’s emotions. That ability is the literal origin of the phrase, “striking a chord.”

Anticipating and coalescing with audience / customer emotions and behaviors is the proper objective of a business model. Such an achievement is almost always temporary. In the same way as most music falls in and out of favor, so do most business models. Change of this sort is not due to a lack of adherence to rules, it’s due to a shift in the audience’s / customer’s emotions and behaviors. (…)

The Latin alphabet is a framework within which the rules of Italian, French, English, et. al can exist. The futures of Italian, French, and English have almost nothing at all to do with the rules of each. The futures of Italian, French, and English are dependent upon what happens within the environment in which each exists.

For instance, Italy was once the banking capital of the world. At such time Italian was a dominant language. When Italy’s banking industry faded the popularity of the Italian language declined. The Italian language did not change, but the audience sure did!

A very important point regarding marketing must be made here. No amount of marketing expertise can mitigate the forces that bear when emotions and behaviors change. The dislocation of the Italian language, of the book business, of the electronics and music business, has nothing at all to do with the level of marketing expertise in each. In fact marketing expertise is totally disconnected from the talent to predict and coalesce with changing emotions and behaviors.

Imagine you’re stuck in an apparent traffic jam on a highway that is totally covered in fog. You can make out the bumper of the car in front of you, but nothing else. Given your situation it might make sense to honk your horn at the car in front of you. Marketers call this advertising, SEO, Networking, “filling the funnel,” eMail Marketing, etc.

But if you could see through the fog to an assembly of cars surrounding you, then honking would be revealed as an absurdity. Seeing through the fog reveals that the problem lies at some level other than that of the car in front of you. What you have done by seeing through the fog is reveal the framework within which cars operate.

You still don’t know the basic and invariable cause of the jam. But you do know that no amount of expert horn honking (marketing) will help. This is framework stuff, and what is needed is knowledge of the forces that can act on highways and traffic. The rules for blowing horns and motoring through fog are inconsequential.

The same is true in business. When a large number of people change what they normally do, business models and marketing become barriers.

Success (be it in electronics, music, books, or banking) only accrues to those individuals with the talent to anticipate and coalesce with an audience’s emotions and behaviors. This talent is built upon an ability to look past the barriers of existing business models and marketing techniques to the untapped possibilities available at the framework level.

Success Is Built On Frameworks, Not Rules
October 8, 2012 by Bob Manna & Matt Manna
Version: 71D02937(R05) • Feb 20, 2014
Photo © zhu difeng – Fotolia.com

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Success Is Built On Frameworks, Not Rules (PDF)

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Changing The Game

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A dominant belief among business/product developers, candidates, advertisers, and influencers of all sorts, is that success is dependent upon certain time-honored procedures. Among the most destructive of these is the belief that success depends upon identifying, segmenting, and targeting future behavior as suggested by the analysis of data representing past behavior.

Research and analysis of this sort is usually followed by application of the “four Ps” — the notion that a “target” will behave favorably when offered a Product that is Promoted at a Place and Price in line with research enlightened calculations.

When success does not flow as predicted, fault is routinely placed on the quantity or quality of data, or on the skill of those who analyzed the data, or on those who enacted the procedures suggested by the data.

Rarely, if ever, is the belief itself questioned. Until now. The belief that success is dependent upon the application of procedures, as suggested by data analysis of past behavior, is wrong.

At its essence, data is distinct and disconnected from the behavior it represents. To put it plainly, behavior is as behavior does, not as it has done. The ability to create success does not come from analyzing the past, it comes from knowing what is possible in the future. The talent to act upon this fact separates a game changer from a marketer.

A marketer administers historical procedures to existing products. A game changer creates success where none exists. A marketer finds comfort in the past. A game changer greets the past with antipathy because he or she knows that past behavior cannot divine what is possible in the future.

To create success, data analysis of past behavior must be replaced with something forceful enough to inform messages, products, services, candidates, and causes with an understanding of what is possible in the future. This is the purpose of Customer DNA, which at its essence is principled with a single idea: the cause of behavior is found inside the mind. That is why we say, “It is better to know how people think than to know what people have thought!”

And how do people think? Without exception all people from every culture (1) create a set of convictions to make sense of their “world,” (2) use their convictions as filters to disqualify incoming messages, products, services, candidates, and causes that are discordant to their existing convictions, (3) seek out and join with others that hold convictions similar to their own.

Convictions are behavior’s doorways. Game changers parlay with them by creating messages, products, candidates, and causes that can pass through and rearrange existing convictions in a way that motivates new behavior. That talent ennobles the game changer above the marketer.

Steve Jobs believed that the historically based arguments of others were wrong and that convergence, not divergence, would be the future of the mobile phone. Some of the best marketing minds in the industry bet against the iPhone because it stood in stark contrast to what came before. (Why the iPhone Will Fail)

But Steve Jobs was a game changer. To Jobs the past had no bearing on the future success of the mobile phone. Jobs understood that the iPhone would provide people with the comfort of continuous connection (a deeply held conviction) while coincidentally providing the means to make a phone call.

In 2007 Howard Schultz told a TV audience that he had no idea how many or what class of people would want to visit a Starbucks store. He went on to say that traditional processes like advertising and ubiquitous distribution were not major contributors to Starbuck’s success. (C-Span Global Innovation Video – Watch the 4 minute segment beginning at minute 7:00 and ending at 11:10)

What Schultz did know is that human connection is a conviction that can be experienced through the basic and invariable meaning of the coffee break. Until Starbucks, there was no place to have a coffee break other than at work or at home. Hence there were no historical data upon which to argue for the creation of such a place.

However, there was (and is) an understanding by Howard Schultz of how people think. That’s why Schultz is famous for saying, “We’re not in the coffee business serving people but we’re in the people business serving coffee.”

Game changers create success when marketers cannot because game changers elevate the possibilities of the future above the certainty of the past. The simple truth is that data collection and data analysis are forceful only when they reveal convictions. Any attempt at creating success that does not accept and comply with this fact is fated for a future of failure.

Changing The Game
August 30, 2012 by Bob Manna & Matt Manna
Version: 0049EFCD(R03) • Feb 13, 2014
Photo © Maksym Protsenko – Fotolia.com

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Changing The Game (PDF)

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On Replication

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If your company ceased to exist would your customer’s desires go unanswered? For many the answer is, “My customer’s desires would go unanswered only until they walked down the street to the next company that offers what I offer.” There is a one word description as to why this is so — replication.

Replication refers to the practice of creating or developing a product, service, candidate, or cause that is substantially similar to that which currently exist. Unfortunately most organizations, most of the time, follow the practice of replication. This is sad because replication always leads to a Marketplace Of Abundance; a marketplace in which there are more products, services, candidates, and causes than people need, want, or care to consider.

The Marketplace Of Abundance is almost always corrosive even though most replicated products extend the merit of their original counterparts. Why? Because replication extends merit at the expense of customer loyalty and price. There is little rational for expecting loyalty in an environment that satisfies desires simply by walking down the street. As for price…

When all is said and done, the survival of an organization is determined by the attention paid to this short four-word question, “How much is it?”

Sellers pay primary attention to the first two words of the question, the “how much” part, because they assume price is the primary concern of customers. But that is not the case. The primary concern of customers is the determination of merit, not the discovery of price. The difference between the two is important.

Merit is a personal intrinsic assessment based on an individual’s circumstances and/or state of mind. Price is an expenditure required to obtain a product. The natural order of things in the mind of a customer is to determine merit before considering price.

In the customers mind the question is not, “How much is it?” In the customers mind the question is changed round becoming, “It is how much?” A purchase decision is not primarily determined by the price offered, but rather on the approximation of the offered price to the inceptive merit felt by the customer.

The corrosive effect of replication on price is that it saturates the marketplace with products that are substantially similar to what customers have already evaluated. In the customer’s mind (and in your mind too) an attempt to evaluate differences in merit between substantially similar products is valueless. In such a situation the only consideration is price. End of story!

One way to resolve this situation is to surrender to replication and create low priced products, promoted with messages designed for high frequency, large reach delivery systems. That is a valid business tactic that works for some folks, some times. But there is a catch. Replication is a paint by numbers exercise that perpetuates a repeating and corrosive cycle of competition, followed by price erosion, followed by consolidation. This cycle can be marginally successful for one or two survivors. For most it’s an agonizing existence. Fortunately, there’s a better way.

The natural order of things in the mind of a customer is to determine merit before considering price. The key to avoiding the pitfalls of replication is to realize that customers deem as meritorious those products, services, candidates, and causes that connect on a personal intrinsic level. This deeply personal, and mostly emotional, evaluation provides the foundation for dealing with replication. To avoid replication, products and their attendant messages must connect to the personal, intrinsic determination of merit that customers are first and foremost looking to satisfy. (…)

We must emphasize the importance of messaging at this point. A product has very little chance at success if the amount of time, talent, and money devoted to creating impactful messages — messages that connect to the customer’s personal and intrinsic determination of merit — does not at least equal the amount of time, talent, and money devoted to creating the product. That may be tough to accept, but it’s the truth!

Creating impactful messages isn’t easy (although it isn’t as hard as shaving an additional 1% off the price of a replicated product quarter over quarter) but it is required to exit the low cost seller’s game. Happily, once a way is found to make the emotional connection, to create and promote a product in a way that resonates with the buyer’s intrinsic assignment of worth, there will be a line of customers out the door. (…)

There are numerous examples to support this claim. The most dramatic emerge from new organizations with no customers that become immensely successful in the face of existing suppliers with a huge resource advantage. Two of the more familiar are McDonalds, that grew to replace White Castle, and Starbucks, that captured a marketplace long dominated by such names as Maxwell House, Folgers, et al.

As we write this article, Apple’s iPad is in high demand everywhere it is sold, including Wal-Mart, where it sells for the same price as it does everywhere else. Interestingly, Apple enjoys a market capitalization of 565 billion dollars while Wal-Mart has a market cap of 247 billion. Which company faces the bigger challenge: Apple, with the task of ensuring their future products continue to connect emotionally; or Wal-Mart, who must continue to find a way to wring another 1% out of the cost of groceries?

The answer lies in recognizing that replication is unsustainable. At some point there will be no more price reduction or logistic efficiency possible. Conversely, the upper limits of developing products and messages capable of strong intrinsic connection, and high profit margins, are boundless.

On Replication
July 20, 2012 by Bob Manna & Matt Manna
Version: 005BC2F0(R06) • Jan 27, 2014
Photo © SM Web – Fotolia.com

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On Replication (PDF)

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Belief In Branding

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The Bank of New York (now Bank of New York Mellon) was founded in 1784 and is generally regarded as the oldest bank in the United States. Although difficult to exactly pin down, people in 1784 lived somewhere between 25 and 40 years. Today the difference between ages 25 and 40 is more a measure of conduct than life expectancy. Nowhere is this more evident than in the world of banking.

Juliette Gordon Low founded the Girl Scouts in 1912. This past year, the father of a Girl Scout described an unusual characteristic that he and many of his Facebook coworkers share; they don’t customarily carry cash to work. This insight, shared with his daughter and her troop, resulted in her troop selling 400 boxes of cookies at the Facebook Headquarters using a mobile device to process payments.

The genesis of the Salvation Army’s Red Kettle Campaign occurred in 1891 when Army Captain Joseph McFee placed a pot at the Oakland Ferry Landing with a sign that read, “Keep the Pot Boiling.” Today ringing bells and red kettles are iconic emblems of the Salvation Army Christmas Charity Campaign.

The bells will likely be around forever but the kettles may not fair as well. This past season The Salvation Army accepted mobile payments at ten separate locations in each of four cities: Dallas, San Francisco, Chicago, and New York. As Salvation Army spokesman Major George Hood said in a recent New York Times article, “A lot of people just don’t carry cash any more. We’re basically trying to make sure we’re keeping up with our donors and embrace the new technologies they’re embracing.” (Bell Ringers Go Digital This Season)

These examples help illustrate the proper definition of the term brand. A brand is a belief (or set of beliefs) that exists inside the mind. This definition of brand differs significantly from the traditional definition: A name, term, design, or symbol that differentiates one seller’s product from others.

Names, terms, designs, and symbols are not brands, they are belief activators. The activated belief(s) are the brand. That is not to say that names, terms, designs, and symbols are unimportant. They are important. But the existence of these things, even when they are expertly designed, will not create beliefs.

A twenty-five year old and a forty year old both require the means to deposit funds into their banking account. In that regard they are alike. But the twenty-five year old makes her deposit inside a coffee house with a smartphone. The forty year old leaves the coffee house, drives to a local branch, and literally deposits the funds in question. Both have satisfied exactly the same need, and both may be customers of exactly the same institution. But each, in a nontrivial way, believes very different things when it comes to “making a deposit.”

No name, term, design, or symbol can be baked into a cookie that will change what Facebook employees in Silicon Valley believe when it comes to paying for products. These folks believe electronic payment processing is superior to cash, end of story!

Major George Hood is almost correct when saying, “We’re basically trying to make sure we’re keeping up with our donors and embrace the new technologies they’re embracing.” We say almost because donors do not embrace technologies. Donors (many in the case of The Salvation Army) embrace causes.

Donors also demand that the causes they embrace adhere to their beliefs. That’s why the Salvation Army’s experiment in accepting mobile payments proved successful in Dallas, San Francisco at large, Chicago, and New York. Folks in those cities embrace the same beliefs regarding payment processing as their Silicon Valley counterparts.

Be it cash, cookies, kettles, or anything else, belief has been in branding since at least 1784. It can’t be any other way since a brand has no meaning outside of the belief that people bring to it. Brands do not bring belief to people, people bring belief to brands.

Belief In Branding
February 1, 2012 by Bob Manna & Matt Manna
Version: 00586F15(R04) • Feb 13, 2014
Photo © Santhosh Kumar – Fotolia.com

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Belief In Branding (PDF)

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