Monthly Archives: November 2008

Bob Garfield's "Chaos Scenario" may start locally

If you haven’t read Bob Garfield’s presentations of how advertising will evolve over the next few years (Part 1 and Part 2), then you should. He calls this the “Chaos Scenario”…a perfect metaphor for what he describes. In it, he argues that traditional advertising is dying out as media usage and consumer behavior are changing. Much of the change has its roots in the rise of the internet as a marketing vehicle. But, Garfield points out, new methods and practices have yet to fully pan out. And many companies haven;t come to grips with this new and show no signs of doing it any time soon. This is going to cause (my interpretation) chaos as traditional media outlets struggle to get advertisers while these advertisers struggle to figure out how to advertise effectively with their limited knowledge.

For the most part, I agree with his thesis. Most major traditional marketing-oriented mediums are becoming less effective as promotional vehicles. Media usage is more dispersed, more personal, and thus, more controlled by the end user. And many times those end users today are choosing to ignore or avoid the advertising messages that are send their way. Whether it ends up being as dire as Garfield suggests, I have no idea, but changes are coming and neither the advertising mediums nor the advertisers themselves are ready for it.

And I think local is where we’ll see it first. I see this happening one the local level over the next three years. Goldman Sachs is predicting that traditional local advertising vehicles – local TV, newspapers and radio stations – are going to get hit particularly hard during this recession. I’m going to agree, and the key world there is “particularly”. That’s because local advertising is hurting anyway as advertisers have already been pulling back because it doesn’t work like it used to. Add to that further cuts in ad spend and you could get a serious amount of casualties on the local media market.

In the above graphs, we can see that newspaper get hit the hardest. Readership is down in the first place. That’s permanent. People have stopped buying newspapers for whatever reason – a lack of interest in news, having news available online, and getting quick news capsules in other mediums. A poor economy has little or no effect on newspaper buying. We won’t be seeing a rebound once the economy bounce back.

The collapse of players in the local ad market will reduce the options for advertisers. Yet the demand will probably still meet the supply. So we’ll see further erosion. Craigslist, satellite radio, and cable TV will make this so.

One of the alternatives will be local online advertising. But I don’t see many local advertisers ready for this. I still see most local companies that are likely to advertise having little more than brochureware websites. I see very little use of local Google Adsense coming from traditional businesses. And, again, the websites are neither optimized for online search nor are they set up with the correct landing pages for potential ads. Local businesses SHOULD be developing internet strategies, but the decision makers in them don’t go to our conferences, they don’t read our blogs, they’re not on Twitter. Nor are they probably on Facebook or MySpace. They’re far from it.

So while they’ll be temporarily holding back ad dollars during tough economic times, they’ll be likely losing some of their traditional advertising choices. And they won’t be ready or equipped to start marketing on new media – because they’ve chosen to not take the time to learn it. The end result? Chaos.

What an ice cream sundae can teach you about marketing

I recently submitted a proposal to do some social media marketing to a restaurant group here in the DC area. The group has four restaurants…three are identical in name and menu and the fourth is Tex Mex. Nice places. I’ll call the place CD. Disclosure: I work part time in one of them. And more about that proposal on another day.

It shouldn’t be surprising that business is down. The economy affects discretionary income and eating out is one of the first things people cut back on. The restaurant is trying out a few marketing tactics, all of which are proving to be ineffective. They’re inherently flawed and, thus, were doomed from the start. The mindset was to do something at the lowest cost possible and hope it works out. And my training in social media gives me insight into at least one of the reasons why: the restaurant want too much control over the flow of their marketing.

There is one long term promo idea that does work. Half price bottle wine nights on Monday. Monday nights are usually dead. With half price bottle of wine, you can save $18 on a $36 bottle. That’s a strong offer. And for the customer, who usually won’t want to venture out on a Monday night, an offer like that pays off.

Here’s a breakdown of one of the tactics and why the control issue makes it assured to fail.

Free kids ice cream sundae on Tuesday night. Think about it. Bad idea. And it’s not that we already have a free ice cream scoop kids seven days of the week. All this adds is chocolate syrup and some whipped cream. But one thing should stand out when it comes to kids and Tuesday night.

Tuesday day is a school day, Tuesday night is a school night. It ain’t gonna work.

Tuesday is the second worst day of the week. Using this as a mechanism to get people to come out is useless. If mom and dad wanted to take Billy and Susie out for an ice cream, they’d head for Baskin Robbins. The offer isn’t strong enough. If they picked one night, they should have picked Sunday night. That’s the night that families go out. That’s often because they’re already out or got home too late to cook. And if we were doing it on Sunday night, the customer would have more control and we would be highlighted more. But Sunday is a school night, isn’t it?

Well, yeah. But here’s why a customer would have more control on Sunday. Mom and Dad will start out with a few places in mind to take the kids. There’s this place and that place, but there’s CD that has free ice cream sundaes for the kids. Let’s choose there. We want to go out and we’ll benefit more by going to CD. So, CD would have empowered the parents to make an easier choice. Instead, with Tuesday, we’re looking to essentially force parents to trudge out on a school night if they really want to give their child a free ice cream sundae. The payoff isn’t there. The hassle of going out – on a school night, and spending money that they wouldn’t have spent (because they would have stayed home) isn’t worth hassle. On Sunday night, when they’re already planning to head out, the payoff is staring them in the face.

This is but one example of how companies market themselves to benefit…themselves…and not the customer. The restaurant has put itself first here, with very little consideration of satisfying the customers’ needs. It’s an attempt to fill seats on an off night by an offering an that gives no real benefits. It tells me that their marketing philosophy is flawed because they’re doing what they do strictly on their terms. The odd thing is that otherwise, the establishments are very customer centric.

People are going to be looking for value in a slowing economy. If you don’t provide that, they’ll go to someone else that will. They’re not going to care if what they do benefits you. They will be focused on their needs. They can afford to be self-centered. You cannot.

Soon, we’re going to see the real negative effects of this slowing economy. The holiday season my be rough, but people will still be spending money, albeit cautiously. Better to put customers first in your marketing NOW to get and stay in their mindset when you will need them more than ever.

That’s why social media, while not being the be all and end all, is so key to a new way of thinking. It changes the culture of marketing and makes it inherently mutually beneficial.

Manga Chris Abraham

Thanks to Phillip Rhoades (AKA Semjaza) for doing his rotoscope Wacom magic and turning me into a brooding, doe-eyed, manga hero.

Happy Thanksgiving My Utterli Friends!

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The Only Good Bank in Berlin

The Deutsche Bank Store of the Future, originally uploaded by Chris Abraham.

When I arrived in Berlin, my buddy Mark told me that I had to follow him halfway across town, past dozens of banks, including a number of Deutsche Banks, from where we were in Moabit down to Friedrichstraße, south of Straße des 17. Juni, to one particular Deutsche Bank called Die Deutsche Bank der Zukunft — “Deutsche Bank of the Future.”

Well, the service is superb! There is a cafe with coffee and food. When you interact with a bank manager, it is in the cafe with personal service. Also, the cafe is open to the public, there is a boutique store in the front with high-end gifts, including gifts from Harrods, strangely enough. I have always been treated like I am rich and important when I am there, no matter how I am dressed or how unshaven. Everyone speaks English, as well.

Not only that, but I am told that, in general, service sucks in Germany, especially in Berlin, especially the service offered in Banks. Maybe a hold-over from Soviet-era bureaucracy — maybe all of the bureaucratic former Eastern Germans ended up manning all of the Berlin banks. Well, that is not the case with the Deutsche Bank of the Future!

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