What is Internal Marketing

Over recent years I have seen lots of organisations trying to improve their internal communications. I have seen organisations with poor to terrible internal communication. I have seen organisations with them and us cultures, poor management and dictatorial leaders. Often these organisations play at internal marketing. They go through the motions, put out poor quality newsletters, send long-winded emails and offer poor quality staff away days.

At one organisation, the senior management locked itself away. They went from bunker mentality to an actual bunker. At another, if a member of senior management went onto the ‘shop floor’ it was akin to a royal visit. When the ‘visit’ was over, the staff sighed with relief; well, it would be another couple of years before they would be bothered again.

The problem with these organisations was that they saw staff communication as an un-necessary hindrance on their grand plan. they viewed internal marketing solely as a communications issue not as a core part of service delivery. After all, the best policy, like the security services was need to know.

These organisations also tended to have top down heavy, ‘do as I say’ management styles. They rejected the more modern, policy down/plan up approach to management.

Last week I discussed the marketing of services and stated that good internal communication processes were critical to service competitive advantage.

Internal marketing goes further than communication. It is the creation of an open, information-sharing organisational culture.

To offer superior customer service you need make a concerted effort to communicate better. Your staff need to know what is expected of them in terms of behaviour and attitude. They also need to know how superior customer service will be measured and evaluated.

Internal marketing should be seen as a powerful tool in managing your organisation. It helps align organisational stakeholders to your organisation’s values and goals.

Internal marketing is knowledge management, not just better communications. It communicates management intentions and expectations. It informs, educates and persuades employees to follow your intended course of action. It should aim to motivate employees and to clarify their responsibilities.

The aim should be to unite stakeholders behind your organisational goals. You shouldn’t only rely on formal communications channels. Informal channels should also be leveraged. Don’t just rely on formal communications plans and team meetings, one to one communications with staff are equally important,

The aim of communications should be to reduce conflicts, not to ignite them. Better informed staff are better motivated staff. Using a ‘Intentions down – Plans up’ approach means staff gain ownership of organisational goals.

You are not simply moving data around your organisation. the aim of internal marketing is to inform, educate, persuade, motivate and enthuse. If you view corporate communications as solely a data process you may end up with data overload.

The following are key factors in internal marketing success:

  1. Clear Objectives: Clear objectives unite the workforce behind organisational goals. They promote organisational change and customer focus. they allow the clear communication and sharing of organisational values. Clear objectives commit staff to a total quality approach and they develop a commitment to customer service. Interdepartmental relationships improve when objectives are communicated; as is organisational knowledge and information sharing. Obviously to be clear objectives need to be SMART.
  2. Identify your Stakeholders: You need to identify their perceptions and expectations; their needs and wants; their concerns and motivations. You need to establish how your organisation objectives deal with those stakeholder criteria. you also need to know the status of interdepartmental relationships.
  3. Communications: What is to be communicated? What is the purpose of the communication? How will a communication affect the expectations of different stakeholder groups. Expectations need to be managed and it is important that you establish feedback mechanisms. You need to avid information overload whilst providing trustworthy, honest, timely communications. You need to avoid an information vacuum where gossip and rumour will fester.
  4. Alliances: You need to create alliances across your organisation. This could be through personal exchanges. Avoid an ‘us and them’ culture; the management ‘bunker’. You need to encourage stakeholders to see issues from various points of view.
  5. Training and Development: You need to equip stakeholders with the knowledge and skills required for them to do what is expected of them. Appraisals should specify internal marketing goals.
  6. Control: Internal marketing and communications need a budget, a schedule and performance control mechanisms. Messages should be aligned with the communication norms of different organisational departments e.g. HR, Finance, Marketing, etc.

Do you have an Integrated Communications Strategy?

A couple of weeks ago, I watched a BBC4 documentary on the history of the electric guitar and effects pedals in rock music.  Included in the programme was a short interview with Uli Jon Roth, the former lead guitarist with the German heavy rock band, Scorpions.

Two of Roth’s comments in the interview stood out.  The first was that he felt restricted with the five note pentatonic scale often used in rock music.  He wanted to use the seven note chromatic scale more often seen in classical music. He wanted to spread licks over two or more octaves rather than one.

Secondly Roth commented that he saw musical notes as colours. he experiences aural synaesthesia.

Roth is known as the ‘King of Shred’.  The man who created a monster that would dominate rock music in the 1980s; shredding.  Roth, like Baron Frankenstein despaired of his creation.  He feels that guitar solos became an exercise in technical proficiency and fitting as many notes in a stave as possible.  Rock music began to forget melody and metre.

So what has an interview with a Euro-rock guitarist got to do with Marketing Strategy?

Let’s take the second point.  Roth’s synaesthesia is a clear indication that people process information in different ways and they react differently to communication triggers.  Some people prefer and will react to visual stimuli, others to aural stimuli.  Some people prioritise touch, others prefer smell.  So if you are limiting your communications triggers to one of the ‘five’ senses, your message may not be getting through to those consumers who prioritise the other senses.  Much of the internet is a visual medium; like this blog; therefore when designing marketing communications, consider the other senses, use sound, smell and touch to get your message into media.

Well, Roth has a point about limiting your options.  Why limit your marketing and communications activities to a few expected promotional channels when there is a wider palette of channels available?

I see lots of tweets on social media praising the use of digital promotional channels as a panacea; a magic pill to all your promotional needs; it is nothing of the sort.

I regularly get criticised that I don’t understand how digital marketing works.  Well I do.  I just believe that digital is one channel amongst many and by restricting yourself to that channel you are ignoring communications options which may provide better return on investment to your business.

Clearly it would be unwise to totally ignore digital marketing channels and social media in your promotional mix.  However, these channels must be used with a strategic purpose which matches the expectations of your target market.  Clearly, if you are selling high street fashion to teenagers, you will need to have digital as a prominent part of your promotional mix.  However, what if you are selling mobility scooters to pensioners? Wouldn’t more traditional promotional channels make more sense?

Digital channels are not a cheap option.  To get equivalent returns to that of traditional media, you may have to spend more on digital.  Before choosing communication channels you need to carefully examine costs and press providers to the level of return on the potential investment.

For SMEs operating locally, it may well be the case that traditional communications channels are a more effective way to get your message across.

Marketing academics are still not convinced of social media as a sales promotion channel.  However, they do see it as useful for customer retention and developing ‘electronic word of mouth’.  It is also good for developing advocacy.

When it comes to digital, you also have to remember Zipf’s law; P(x)≈1/x.  You can optimise your position on search engines to your heart’s content but if you’re not within the top four links on a page your chances of picking up significant numbers of clicks are dramatically reduced.  Firms like Amazon can put huge resources into securing the top links on a search engine page, irrespective of the alterations ISPs make to search engine algorithms to compete head on against those resources may a highly inefficient use of promotional budgets.

So when developing a promotional mix do not put all your eggs into one basket. Don’t do what is ‘expected’ in your chosen segment; do something different to your competitors.

Marketing as a science is a fairly young discipline.  Academic rigour only began to be applied to it in the 1950s.  It is a developing field where theory and models are continually evolving.

For many years the presumption was that different promotional channels had to be dealt with by separate professional consultants.  You went to a direct marketing agency for printed matter, you went to an advertising agency for TV and radio advertising (in fact there were/are specific agencies for radio advertising).  If you wanted press attention, you used a PR agency and exhibitions were often the remit of your sales department.

In the 1980s, academics began to promote integrated marketing communications.  This was the delivery of a single consistent group of messages across media channels.  Prior to IMC, different communications media were used to deliver different parts of the promotional mnemonic DRIP.  Advertising was used differentiate your products from those of competitors; sales promotion was used to persuade customers to purchase.  PR was used to remind customers of your existence and print media was used to inform customers of your products attributes.

Under IMC, a single message was used to deliver all the aspects of DRIP.

IMC was seen as having significant drivers:

  • it increased the efficiency of promotional activities
  • it increased the accountability of marketing managers
  • it promoted the need for ‘cross-border’ marketing and changing communications structures
  • It coordinated brand development and the creation of competitive advantage
  • it allowed for more efficient use of management time
  • It provided direction and a sense of purpose for employees
  • It anticipated greater levels of audience communication literacy
  • It foresaw media and audience fragmentation
  • It allowed for stakeholders increasing needs for diversity of information
  • it reduced message clutter and allowed for media cost inflation
  • It accounted for competitor activity and low levels of brand diversification
  • It allowed for the creation of relationship marketing as opposed to transactional marketing
  • It allowed for network development, collaborative marketing and the creation of alliances
  • It allowed for technological advances and new communication channels e.g. social media.
  • It aimed to increase message effectiveness through consistency and the enforcement of core messages
  • It allowed for the development of more effective consumer triggers and recall of both messages and the brand identity
  • It aimed to develop consistent and less confusing brand images
  • It developed a need to build brand reputations and to provide clear identity cues.

IMC sounds wonderful doesn’t it.  Most importantly it was seen as a way to create a customer-centred promotional strategy.

IMC was seen as having the following advantages:

  • Efficient use of promotional budgets
  • A synergy to communications
  • Competitive advantage through clear positioning
  • Coordinated brand development
  • Employee participation and motivation
  • It allows for the review of communications activities
  • fewer agencies were needed to support a brand.

However, there were some downsides to the creation of integrated marketing communications strategies:

  1. It was a strategy that promoted centralisation of activities and the development of bureaucracy.
  2. It promoted the uniformity of a single message (difficult if your aim to target two or more distinct market segments)
  3. It leads to ‘Mediocrity’ as all communications activities are in the hands of a single agency.

So like Uli Jon Roth’s approach to the rock solo, IMC became a bit of a monster.  Some marketing academics felt that it lost the ‘melody and metre’ of promotional activities.

Today, most marketing academics promote a nuanced form of IMC.  Yes messages should be used to promote all aspects of DRIP and promotion is a role for all the stakeholders in an organisation, not just the advertising department.

Today it is advocated that promotional strategies is the creation of a promotional mix using tools which best fit the expectations of your target customers.


Brand language and communications

Increasingly promotional activity and communicating brand messages is not a verbal medium; it is a visual medium.  The requirement to create visual messages; combined with the ever-shortening attention spans of viewers; makes promotional advertising and the communication of brand messages more difficult.  Consumers are bombarded with commercial messages.

This means that if you are to successfully communicate your brand message, you must carve out a distinct territory.  A unique and successful brand message does not appear out of thin air.

Creating brand territory is not as simple as just repeating the same phrases over and over again.  It is the development of a brand language which expresses your corporate ideology.  It is a favourite practice of politicians to come up with a single phrase which encapsulates their whole campaign; for example Donald Trump’s ‘Make America Great Again’, Theresa May’s ‘Strong and Stable’ or Tony Blair’s, ‘Education, Education, Education’.  Politicians are trying to create a shorthand which uses a single phase to draw the attention of the widest possible electorate.  However, for a commercial branding strategy, such shorthand leads to excessive repetition which can clog up the brand message.

Often there is such an urge to create an image of unity and common spirit in a brand message across different campaigns that brand messages become a code.  Code is artificial language.  it isn’t human or natural.  When creating a brand message you want to communicate personality, your culture and your brand values.  You want to announce products in a way which charms customers.  If you resort to a shorthand, impersonal code, these factors are missing.

Rather than creating a code, you need to build a glossary of terms which apply to your brand.  Such a glossary helps decentralise your message whilst keeping your chosen language within your identified brand prism.

The process is similar to the creation of the style guides used by newspapers and other publications.  The style guide for The Economist runs to over three hundred pages and the Yahoo style guide is even longer.  These documents specify the agreed spelling of certain words, page layout and appropriate punctuation.  They define how these publications look on the page.

A brand charter, or expression guide, the promotional equivalent of a journalistic style guide.  They will include agreed phrases and even where on a page the brand name and logo are located but they will also specify the dominant features of style such as colours used, text fonts and image requirements.  For internet and television promotions they will show agreed gestures and jingles.  Graphic layouts and narrative structure codes will be included.  Think of a Coca Cola television of cinema advert, they will nearly always show someone drinking from the traditional glass Coca-Cola bottle (the bottle shape is a registered trademark) even though the majority of Coca Cola sales are now either in metal cans or plastic bottles.

In mature markets advertising is a challenge. There are no guaranteed results and often defined goals are not easily measurable.  Such goals are not SMART (Specific, Measurable, Achievable, Realistic or Time Bound).

As a result many brands are switching away from traditional advertising forms and mediums.  For example the wine brand Jacob’s Creek has stopped using traditional television advertising and instead has switched to the sponsorship of television programmes.  Jacob’s Creek was built on an award-winning product, in-store promotions, support to the retail and distribution trade and customer tasting sessions at the point of sale.  The switch from traditional television advertising to programme sponsorship is a better match top the brand image and ideology.  Another tactic being employed by Jacob’s Creek and other brands is the increased use of product placement in films.

For top of the range brands, a common branding tactic is an association with opinion leaders.  For example, eBay is arguably the most successful internet sales and auction site.  eBay’s position was not built on television advertising (although recently they have started to use that promotional channel).  EBay developed its brand position through the use of online referral and public relations.

There is an old maxim: “Half of my advertising budget is wasted but I don’t know which half”.  Statement is nonsense.  Wasted promotional activity is easy to identify.  It is advertising activity which:

  • Is not sufficiently creative and individual
  • Which misses its target audience
  • or which is shown where the promoted product is not on sale.

Of these three reasons, the first is the most important.

Often, the failure of promotional campaigns is blamed on the advertising agency.  However, the client employing the agency can be equally at fault.  often promotional campaigns fail because the specification provided to the agency is not clear in identifying the required brand message of the goals to be achieved.  Often the fault is the quality of the brief, not the quality of the agency.

Brand propositions must be incisive.  They cannot be bland.  it is unlikely that even the most creative advertising agencies can transform a bland brief. A promotional brief that is full of statistics and has a dearth of actionable ideas is likely to fail.

You must radicalise your advertising targets.  Your brief shouldn’t just describe your target customers, it should reflect them.  Your promotional messages should be given through radical characters not plain people.  For many years Cillit Bang was advertised using a fictional character ‘Barry Scott’.  Barry became as famous as the product.  Many thought him to be a real person and not an actor playing a part.  The Barry Scott character was carefully designed to reflect the ideal consumer of the brand and to exaggerate defined characteristics.

After using the character for many years, Barry was dropped from Cillit Bang’s advertising and there was a distinct fall in sales.  So much so, the character was brought back and once again fronts their advertising.

Creative and radicalised promotions are difficult for brands which consumers have known all their lives.  Oxo has recently reverted to having a OXO family, a promotional strategy it first used in the 1970s.  However some mature and established brands do manage to present radicalised messages.  One need only think of the Cadbury Dairy Milk promotion with the drumming gorilla.

If you are looking to promote a brand over the long-term or to reinvigorate a mature brand, it is important to present a radicalised message and the development of a comprehensive brand charter.

Defining your position

A critical element in the planning of marketing mix strategies, including promotional communications, is the management of your market position.

Market positions operate in relation to two dynamics:

  1. who is the target audience – i.e. your chosen market segments; and,
  2. how that audience views your offering – either through their understanding of how the product works or through their understanding of your communications. i.e. how their minds interpret your message.

One of the roles of marketing professionals in a business is to research these two dynamics and to develop a position which maximises the offering in relationship to them.

Most marketers use the following process to develop distinct market positions:

  1. Examine the positions of a business’s competitors.  This usually involves the development of perceptual maps taken from customer market research.  Perceptual mapping helps determine consumer attitudes and perceptions.
  2. They then determine the position of the focus brand.  This is the process of finding gaps in the market which are commercially viable or where competitors are seen as vulnerable.
  3. You then determine the positioning strategy for your brand.  Where in the market do you want to be.
  4. The next stage is critical.  You must determine whether that market position is viable in terms of the competition and your budgetary constraints.  I do a presentation on strategic marketing planning which includes a section on positioning.  I use the example of a private jet catering company.  Despite being in existence for a number of years, the company has never made a profit.  The owner of the firm believed he had identified a clear position in the market which was not being catered for (sorry bad pun) by his competitors.  However, it was clear why his competitors had not filled that market gap – there wasn’t enough income to be generated to cover the high costs of the segment.  In choosing a market position, it must be viable in the long-term.
  5. Once an appropriate market position has been chosen, you should develop an appropriate marketing mix which will maximise opportunities.
  6. You then need to continually monitor the market position; to defend against entrants to the segment and to adjust your offering to account for changing consumer tastes.

You need to develop a position which your intended customers can relate to and understand.   This means developing distinct brand attributes and values.

There are numerous approaches to developing marketing positions based upon factors in the market, customer profiles at through brand redefinition e.g.

  • Product features:  For example, mobile phones are sold on features such as software apps, storage capacity and the quality of the built-in camera.
  • The price/quality ratio:  Price is often a strong signifier of quality.  You don’t get cheap designer watches or clothes.  For many years Stella Artois lager was sold using the strapline “reassuringly expensive’.
  • The product class association: Dove is not a soap, it is a ‘beauty bar’.  Head and Shoulders began its life as an anti-dandruff shampoo, not it is sold as the UK’s favourite shampoo.  Listerine began life as a multi-purpose household detergent, now it is sold as a mouth wash to prevent bad breath.
  • The product use: A few years ago, Kellogg’s ran a highly successful advertising campaign where their cereals were redefined not simply as breakfast food but as snack foods to be eaten at any time of the day.  They also ran a campaign advertising their cereals to people dieting to lose weight where they replaced either lunch or dinner with a bowl of cereal.  Kellogg’s Corn Flakes were originally sold as a health food.  The original formulation of Coca Cola was sold as a medicinal tonic, not a soft drink.  Lucozade was a drink for invalids but its use was successfully re-interpreted as a drink for sportsmen and sportswomen.
  • The User:  Products which are designed for carefully chosen consumer groups.  This is common in the market for fragrances.  Firms such as Unilever and Estee Lauder develop perfumes with pop stars such as Britney Spears and One Direction to specifically target their fan base.
  • The Competitor:  For many years Tesco and Sainsbury’s battled to be the UK’s top supermarket chain.  They would watch each others activities closely and develop very similar offerings in terms of own brand products and specialist ranges.  Before their demise, Saab competed with Volvo as to who produced vehicles with the highest level of safety features.
  • Benefit: Sensodyne toothpaste is marketed as the toothpaste for people who suffer from porous tooth enamel.   Daewoo for many years marketed the fact that you could buy their cars directly without a dealer as a middle man.  Eliminating the dealer was seen as a benefit as it reduced vehicle costs and increased the consumer’s power in the deal.
  • Heritage or cultural symbol:  A unique aspect of heritage in the UK is the display of Royal warrants, the fact that your firm supplies goods and services to the Queen and Royal family.  It is no accident that Universities are marketed using their coat of arms.  Firms proudly display that they were ‘established in 1803’ and there are brands such as Kronenbourg 1663 lager which use a date as an indication of longevity and quality.

Whatever the position chosen for a brand or product, it must be relevant to the target customer group and have a consistent marketing mix.  It must be believable and credible to consumers and supply chain partners.  It must be developed for the long-term.  It must be adaptable to account for changing market conditions and customer tastes.

If you are looking to reposition an existing brand or product (such as Listerine) you should do so not from your own perceptions but from the viewpoint of consumers.  You need promotional and marketing activities which suppress the old market position so that the consumer dissociates the product with its existing position.  You also need to promote the new position so that consumers are educated about the change.  It is important that these two activities are complimentary i.e.  the activities which weaken the old market position should strengthen the new market position.


How the Tories forgot the rules of brand promotion

The consensus amongst political commentators is that the campaign delivered by the Conservatives; sorry, Theresa May’s team; at the 2017 general election was a complete disaster.  At the beginning of the election’s long campaign, the polls gave the Tories a massive lead over Labour.  Theresa May’s approval rating as Prime Minister soared above other part leaders.  The election looked like it would be a landslide win for the Conservatives; the parliamentary Labour Party would be decimated; and Mrs May would get her mandate to deliver a hard Brexit.

Now, following her cataclysmic campaign, Theresa May’s dreams are dust.  She has been transformed from a reincarnation of Margaret Thatcher into a creature of ridicule.  She has lost all credibility.  She is a zombie prime minister awaiting the delivery of a blade to her political cerebral cortex.  It is only a question as to which of her backbenchers delivers the blow.

So how did May’s campaign disintegrate so spectacularly?  Many have pointed to her robotic and awkward delivery, her inability to think on her feet and her unwillingness to actually meet the electorate.  It is true that an attempt to run a campaign based on personality when your candidate doesn’t appear to have one is a major mistake.  Certainly a significant proportion of the UK population were confused by the campaign’s presidential style.  However, I believe a far greater flaw was that those running the campaign had clearly ignored the lessons in marketing strategy and brand management which Mrs May’s predecessors had successfully used to win elections.

When I was growing up in the 1970s, the presentation of political campaigns was staid and boring.  it was men in grey suits, sitting in sepia clad television studios, arguing about economic statistics.  All that changed in 1979 with the general election campaign of Margaret Thatcher.  The Iron Lady had employed Gordon Reece as her image consultant to ensure that she projected an appropriate personality to the electorate.  for the campaign itself she went outside her party machine and employed the advertising and marketing firm Saatchi and Saatchi to run the campaign.  The principles of commercial marketing and PR were applied to the campaign.  It was politics packaged like a tin of beans.

Many may think of Mrs Thatcher winning several successful landslide majorities

Mrs Thatcher’s successors took things further; Tony Blair in particular.  Blair clearly applied techniques used in Neuro-linguistic Programming such as the subtle use of repetitive phrases and mirroring body language of his inquisitors.  Blair used prominent slogans, such as ‘Education, Education, education’ but was also evident in his interviews and speeches were more subtle phrases and nuanced language designed to enter the subconscious of voters and make them act in a particular way.

I suspect Theresa May had been told of Blair’s neuro-linguistic tactics and tried to emulate them but her ability to execute them was sadly lacking.  Just repeating the same phrase over and over may get your message across but such overt declarations are will more likely bore your audience than affect their behaviour.

Perhaps the biggest fault in the Conservatives 2017 campaign was that it took an extremely old-fashioned view of promoting a brand.

The traditional view of a brand image is the creation of a solid identity.  To build this identity, it was felt that regular repetition of key attribute was required.  Sameness would build brand equity.  This was done to excess by Mrs May and it was the repetition of a single phrase ‘Strong and Stable’.  To Tory campaign managers ears this may have sounded perfect; the brand identity boiled down to three words.  The electorate however clearly read this message differently. To them it signalled not stability but a lack of adaptability, no fleetness of foot and a political ideology with its feet planted firmly in concrete boots.  The electorate clearly didn’t want a government determined to stick to its right-wing guns; it wanted a government with the ability to change in the face of a turbulent political climate.

The torpedo which sunk HMS Theresa May was her policy of using pensioners property equity to pay for their social care.  This policy directly attacked the Conservatives target audience, the over-50s.  Clearly, the unpopularity of the policy panicked Tory central office and the subsequent U-turn completely destroyed the single brand message of Strong and stable.  Such a U-turn wasn’t strong and stable, it was weak and wobbly.

A more modern view of developing a brand is to treat it as having two layers of attributes.  Kernel attributes at its core and peripheral attributes.  This view is to address a dichotomy in brand presentation.  Brands need a solid identity to provide capital but in modern markets, where consumers are impulsive and used to rapid change, a brand must have the ability to surprise and have diversity.

A brand which only has kernel attributes may have power but it will lack relevance in the minds of the intended audience.  A brand with only peripheral attributes may be relevant to the target audience but it will lack the necessary power.

The modern view of creating a brand with kernel attributes to provide solidity but also peripheral attributes which can be adapted to meet the variety expected by modern consumers.

This is where Theresa May’s campaign failed spectacularly.  It had a kernel attribute ‘Strong and stable’ but it had no peripheral attributes.  The campaign was based almost exclusively on Mrs May.  The rest of her party hardly got a look in.  So when that kernel attribute was blown out of the water by the social care U-turn, the campaign was left as a hollow shell.  If Mrs May had run a more diverse campaign, with more than a single attribute, she may have been able to ride out the social care fiasco and retain her majority.


The UK 2017 Election: A Marketer’s Perspective

thisIn the early hours of Friday morning, the result of the UK general election was clear.  Theresa May’s gamble to try to secure a landslide majority had backfired spectacularly.  Instead of the hundred seat majority the Conservative Party were seeking, the new parliament was hung.  That means that no single party could command a majority to deliver manifesto commitments.

As I write, negotiations have begun with the Democratic Unionist Party from Northern Ireland on a pact which would allow a Tory minority government to cling on to power by its fingernails.  This probably will result in want is known as a confidence and supply agreement where the DUP will vote with the Conservatives on big issues such as the budget.  This is a weak situation.  Mrs May, or whoever replaces her as she is unlikely to survive as prime minister in the long-term, will have to constantly do deals to govern.  This will involve not only the DUP but will also mean avoiding backbench rebellions.  There is a significant moderate group within the Conservative Party who do not want a ‘no deal’ exit from the EU who will frustrate much of Mrs May’s increasingly hard-line agenda.  That group now has a prominent leader in Ruth Davidson, the Scottish Tory leader, who, in contract to her English counterpart, had a highly successful election night.  Davidson returned 13 Scottish seats for the Conservatives; twelve more than the party had achieved in 2015.  Ruth Davidson and her loyal MPs are now the power brokers within the Conservative Party and the Scottish Tories are a far more moderate grouping than the party in England.  For instance, Davidson is adamant that the UK should remain within the European Single market post Brexit.  Ruth Davidson is also gay.  She is planning to marry her female partner later this year.  She is distinctly unnerved about her party having any kind of alliance with the DUP which is anti-gay rights.

The UK is entering a period of political uncertainty the likes of which it has not seen since the mid-1970s and the minority Labour government of Harold Wilson.  In that instance, Wilson’s pact with the Liberal Party (now the Liberal Democrats) lasted eight months.  I cannot see Mrs May remaining prime minister for that long.  She now must be seen as an interim leader.  I fully expect a Conservative leadership contest by the time of the party conference season and it is highly likely that there will be a second general election either in the Autumn or in the Spring of 2018.

So where did it all go wrong for Theresa May.  Many commentators are pointing at her election campaign which has been described as the worst of all time.  That is some claim considering Michael Foot’s 1983 Labour manifesto was described as “the longest suicide note in History”.  I believe the Conservatives, and Mrs May in particular, completely misread the will of the people, they didn’t properly analyse opinion poll data (much of which was probably wrong) and the forgot all the rules of marketing promotion.

In his book, Marketing in the Public Sector, describes three key questions that need to be answered when preparing a campaign:

  1. What do you want your audience to know?
  2. What do you want your audience to believe?
  3. What do you want your audience to do?

The first question is the setting out of the specifics of your offer.  The Tory manifesto did not do this.  It was wholly un-costed.  This immediately created cognitive dissonance amongst voters as it made Tory attacks on Labour seem to be unfounded.  Labour had produced a ‘costed’ manifesto.  You cannot complain about the financial impact of one parties manifesto if you haven’t bothered to provide any evidence as to the financial implications of your own policies.

The lack of specifics in the Tory campaign was startling.  It was a campaign wholly made up of vacuous soundbites most prominently ‘Strong and Stable’; more of which later.

Mrs May also forgot her second audience.  Not the electorate, but her party and her MPs.  She obviously doesn’t believe in internal marketing.  The most prominent example of this was her social care policy, which in reality was little more than a complicated equity release scheme.  Apparently, this policy was added to the manifesto at the last-minute.  Rather than discussing this policy with her cabinet, her chancellor and her MPs, Mrs May inserted this into the manifesto on the advice of her inner circle of advisors.  When the policy was announced, it overturned a long-standing commitment and when asked about it her MPs could provide not detail.  The policy was quickly amended, making her look anything but ‘Strong and Stable’.  Rather than sharing that rather crucial piece of information with her party, Mrs May kept it to herself.  It gave the impression that she didn’t want her audience to know.

That brings us to the second question, what do you want your audience to believe?  It was absolutely clear what Mrs May wanted her audience to believe.  She wanted them to believe she was the reincarnation of Margaret Thatcher, a strong unbending leader who would be able to drive through a ‘hard’ Brexit.  To this end, the election campaign hardly mentioned the words Conservative Party.  It was a presidential campaign for Mrs May.  Her name was emblazoned all over the parties battle bus.  Conservative was in very small print on its door.  Mrs May was everywhere.  Other cabinet ministers were locked out from debate.  To this day, nothing has been heard from Boris Johnson, Philip Hammond and other senior cabinet members.  This wasn’t a British election, it resembled a personality cult; and the British electorate did not like it.

The answer to the third question is obvious.  The public were to vote for Theresa May and to give her a dominant thumping majority.  I suspect that this made many voter thoroughly uneasy.  It smacked of a democratic dictatorship where political discourse and differing views were to be silenced.  It was an Orwellian, 1984 vision.  Mrs May was big brother watching on.  ‘Saboteurs’ would be crushed. Objectors were the ‘Enemies of the People’ (both headlines in the hard right Daily Mail, a newspaper which in 1938 supported Hitler and Oswald Moseley’s fascist party of Great Britain).  I suspect this vision unsettled many Tory voters of the centre right.  The British people are proud of their democracy and the Tory campaign seemed to be riding roughshod over it.  That made many voters in the centre ground abandon a Conservative Party which appeared overly authoritarian.

In his book, Philip Kotler also gives advice of effective messages.  He says:

  1. Keep it simple
  2. Focus on citizen benefits
  3. Use words which create vivid messages
  4. Use words which are easy to remember
  5. Ensure the style and tone that fit the brand

The May campaign certainly applied the first criterion.  The campaign was little more than the words ‘Strong and Stable repeated Ad Nauseam.  If anything the message was too simple; this was a general election, not a campaign for washing powder.  It gave the impression that the Conservatives were keeping things secret; that there were horrors behind the curtains of number 10 which they did not want to get out.  The lack of any kind of detail and the vagueness of the party manifesto announcements spooked the electorate.  In fact there are many horrors being hidden from public view.  Take as an example the impact of Brexit.  It was leaked during the campaign that the government had prepared 60 impact assessments on the likely effects of Brexit on the UK.  Normally, such documents are published for consultation amongst politicians and affected organisations.  Not one of these impact assessments was released for scrutiny; which implies they hold adverse information of the effect Brexit will have on the rights of the electorate and running of the UK economy.

The manifesto also attacked the interests of target tory voters.  The Conservatives rely on the votes of over 50s.  It is the party of the affluent middle-aged and their parents.  A segment of the UK population which has done very well for itself over the last forty years.  The Conservatives ignored the youth vote during the election believing, incorrectly that ‘market segment’ does not vote in large numbers.  That was a bad judgement call and Labour were highly successful in motivating young people, particularly students to vote.

The seat of Canterbury was a fine example.  That seat has been Conservative since the 19th century.  However, it went to Labour.  Mrs May held the election during University term time, which meant that 40,000 students were registered to vote in the city.  En masse the voted for Labour and a safe Tory seat was lost.

Then, halfway through the election campaign Mrs May made her changes to social care.  Elderly people were to pay for care through property equity.  They wouldn’t be able to pass on more than £100,000 to their children in their will.  There was no cap on the amount they would have to pay for their care.  In addition, their winter heating allowance was to be means tested.  It was quickly pointed out that the social care policy, dubbed a death tax, was a licence for mortgage equity release mis-selling and fraud.

The ‘death tax’ was a direct attack of the Conservatives core target audience.  It went down like a bag of cold sick.  When it was rapidly altered, it destroyed any attempt to describe Mrs May and her close-knit team as ‘Strong and Stable’.  Her opponents had a wound at which to scratch.  Theresa May wasn’t ‘strong and stable’, she was ‘weak and wobbly’.

The idea that a prominent announcement, of a barely thought out policy, kept secret from prominent members of your party and which attacked the interests of your core voting constituency is idiotic and politically naïve.

Finally, we come to the fifth element of effective messaging, ensuring that the style and tone of the message fits your brand.  The Tory campaign completely ignored this factor.

The Conservatives ran a personality campaign.  Who do you like better, Theresa May or Jeremy Corbyn.  The answer was that the majority of the electorate didn’t like either of these options.

If you are to run a campaign on personality rather than issues, it is best to check that your candidate has one.  Theresa May is stilted, awkward and appears unable to think on her feet.  Her campaign was a series of tightly controlled press conferences and events.  She rarely met a voter, she refused face to face debates with her opponents.  She only answered questions with carefully rehearsed soundbites.  She gave the impression of being unable to think on her feet and she seemed incapable of off the cuff humour. Her appearance on the BBC magazine programme The One Show was execrable.  She came across as a mix of Hannibal Lecter and Zelda, the puppet villain from the Gerry Anderson television series Terrahawks.

Media was full of tales of factory visits where the workers were told to leave.  Late in her campaign, in an attempt to rescue her profile she visited Smithfield Meat Market where she was met by catcalls and calls of “Vote Labour”.

Compare her campaign with that of her Scottish equivalent Ruth Davidson.  Davidson is a moderate Tory.  She is a martial arts enthusiast and a lesbian.  She is quick-witted and funny.  Ruth Davidson is a human, Theresa May is a robot.  People genuinely like Ruth Davidson even if they don’t agree with her politics.  She can relate to them where Mrs May cannot.

The decision to base the Conservative election campaign on Mrs May’s empty personality, to reduce it to a personality cult and to obfuscate policy detail was a huge error and made a weak and divided Labour party look electable.

Since the election Mrs May and her coterie of extreme Brexiteers have tried to act as if nothing has changed.  It is business as usual they say.  They are spinning faster than a laboratory centrifuge.  The result has been a further advance for Labour in the polls.  Survation, the polling company who provided the most accurate prediction of the election now has Labour leading the Conservatives by six points.

Theresa May cannot hang on to power.  The coup is coming.  The enforced resignation of her two Chiefs of Staff and their replacement by a former MP who strongly supported remain in the EU referendum is a clear sign that the moderates in the Tory party are regaining control from the right of the party.  Hard Brexit is dead.

I for one am somewhat relieved by the election outcome.  Yes, things are complex and there will be many difficulties ahead but the prospect of the most damaging form of Brexit, which would have belittled the UK as a nation and which would have meant extreme hardship for the least able in the country is much less of a possibility.  In fact, once the details of the effects of Brexit on the UK economy start to leak out; and they will; the whole rotten concept may be abandoned completely.



What determines your advertising spend?

Determining how much you are going to spend on your marketing communications can be a difficult process.  It is difficult to quantify precisely the amounts needed to complete all the required tasks.  Communications budgets do not fit neatly into accounting practices.  The diversity of communication’s tools available makes it difficult to allocate spending appropriately.  the budget setting process can be less than clear-cut.

There are four main sets of stakeholder in the setting of communications budgets:

  1. The organisation
  2. Communications (advertising) agencies
  3. Media providers (TV companies, publishers)
  4. Production and fulfilment houses

There can be difficulties in the appropriate allocation of budgets between these parties.  Difficulties can be both political and financial.  For example, is your digital marketing spend the responsibility of your marketing team or is it overly influenced by IT professionals who know the technical detail?

Increasingly, in the modern world, there is audience and media fragmentation.  There are now hundreds of television stations, not the three or four of the 1970s.  This means smaller audiences.  In the 1970s it was not unusual for audiences to be ten to fifteen million.  Now an audience of 5 million is seen as high.

Consumers have changing priorities and increasingly, due to the worldwide web, there is a global perspective in marketing.

Over the decades, several methods of assessing communications and other marketing budgets have been developed.  These are added to traditional unscientific methods used in small businesses.

  1. Marginal Analysis – Which compares promotional expenditure with sales and profit margins.  The aim is to find the point where marginal revenue is equal to marginal costs.  At this point profits are maximised.  At a certain point promotional spend does not cause a further increase in sales,  After this point, profit margins will fall because of promotional saturation.  There are many issues with marginal analysis.  It doesn’t take account of your competitors’ reaction to your promotional expenditure.  It assumes that your products are evenly distributed across your market. It also assumes that communications are the only factor affecting sales.
  2. Arbitrary – This is often known as ‘chairperson’s rules’.  The boss sets the communications budget of gut feeling.  Budget is allocated on a guess.  Budgets are allocated ‘on the hoof’.  No attempt is made to consider need, strategy or environmental changes.  No budgets should be set in this way.
  3. Inertia – Communications budgets are always the same.  There is a failure to respond to market and environmental challenges.  Again, this is not a way to set any budget.
  4. Media Multiplier – This recognises changes in the cost of media charges and inflation.  Budgets are changed to account for increases and decreases in these costs.  Such a strategy assumes that marketing strategy never changes.
  5. Percentage of Sales – Communications budgets are set as a percentage of past sales or expected sales e.g. Communications budget is 5% of turnover. This can be a backward-looking strategy and can make no account of sales potential.  The result can be a limiting of your performance.
  6. Affordable – This is often seen as a sophisticated method relatively free of risk.  Each unit of output is allocated a share of the cost of production and a share value-added activity costs such as packaging.  An allowance is made for profits.  What is left over is spent on communications.  This is often used in companies which are product not customer focused.  If your market fluctuates it can be a vague calculation.  It can also lead to new opportunities being missed.

Quantitative approaches to budget setting include:

  1. Objective and Task (often referred to as Zero Budgeting) – The resources required to achieve each objective are determined.  The costs of each of these resources is aggregated to form an overall budget.  The focus of management is the achievement of goals.  Sophisticated monitoring and feedback mechanisms need to be developed.  What is often missed is a strategic focus.  Objective and task can be good for individual campaigns but bad in terms of overall strategy.  It can also result in regular ‘bun fights’ for budget allocation and cause resentment amongst the staff of different departments.  It can be a disaster for staff morale as resentment between teams can develop.  Often Payout Plans need to be developed where two or three future revenues and costs are estimated to ensure budget expenditure is recouped.  Sensitivity analysis is also used to peg back expenditure because costs are larger than expected or sales develop too slowly.  This leads to objectives being changed mid-stream and strategies altered to reduce the payback period.
  2. Competitor Parity – You spend the same percentage of overall budget on your communications as that of your competitors.  This assumes that everyone in the market is the same and that everybody has the same strategy.  You are not necessarily comparing like with like.  This can lead to a ‘me too’ attitude to marketing and it ignores qualitative aspects of communications.
  3. Advertising to Sales Ratio – where you take account of your market share in your advertising spend.  This assumes a direct correlation between advertising and sales.  It also assumes that you can calculate the overall promotional spend of the market as a whole and of your competitors.  By comparing your communications spend to the market average, you can assess whether you have economies of scale or if your communications are working harder for each pound spent.  A/S ratio can be a valuable indicator as to overall communications spend but not the value of individual campaigns.
  4. Share of Voice – This method is commonly used by marketing professionals.  Basically it is a measure of who shouts loudest in the market.  It measures your share of advertising spend (Adspend) as a percentage of what is spent in your market as a whole.  It is often combined with market share.  Where share of voice and share of market are equal, equilibrium is achieved.  In such circumstances, when communications spending is increased, the market share will increase; and vice-versa.  A useful calculation is to compare your share of market with your competitor’s share of voice:
    1. If both are high, the best strategy is to spend on communications to defend your market position
    2. If your competitor’s share of voice is high, but your share of market is low, it is best to find a niche position, to decrease advertising spend and find other ways to promote your products.
    3. If your competitor’s share of voice is low and your share of market high, you need to hold your position and moderate your advertising spend to maximise income.
    4. Where both are low, there is the opportunity to attack your competitor’s market position through adspend and take advantage of growth opportunities.

Where Share of Voice is greater than Share of Market, investment brands are defined.  These may be new products or products in the growth stage of their lifespan.

Where Share of Voice is less than Market Share, there is opportunity for profit taking.  These may be mature brands and cash cows.

In assessing share of voice, it is important to note:

  1. That new products often require higher communications spending than long-established products.
  2. That smaller brands often have smaller profit margins than larger competitors due to economies of scale and the requirement to have a higher proportion of adspend to sales.
  3. That large brands are often milked for profits and their share of voice is regularly smaller than their market share.

Marketing success is often measured through Share of Voice as opposed to budget size.  It also has to be remembered that a large proportion of communications spend is used to retain a market position rather than to attract new customers.

In determining the appropriate level of communications spend, you need to take account of:

  1. your organisations structure, strategy, direction and values
  2. your available financial resources
  3. the activities of your competitors and wider market conditions
  4. The economic confidence of consumers and retailers
  5. Your required level of product development and your marketing objectives.

The setting of communications budgets needs a strategic approach.

Think before jumping on the social media bandwagon

Last Thursday, I attended the regular small business networking meeting arranged by my local branch of the Federation of Small Businesses.  By the end of that meeting, I was fuming.  The focus of my anger, that evening’s talk entitled Five Things You Must Do Now on Social Media.

I was angry at the length of the talk; at these events contributors are supposed to give presentation of around 20 minutes, the speaker talked for over an hour.  However, I was even angrier at the content of the presentation.

The speaker, like me, was a member of the Chartered Institute of Marketing.  Yet in her talk on the latest hot topics in social media marketing there was not a single mention of strategy, of objectives, of monitoring activity or of return on investment.  There was also no mention of the potential hazards of using social media as a marketing communications channel.

I therefore dug out my textbooks and looked at what experts in digital marketing had to say on the subject of social media.  I referred to Dave Chaffey’s book Digital Marketing (Dave also runs the excellent Smart Insights website) and the SOSTAC method advocated by PR Smith.  These two individuals are probably the most renowned academics working in the field of digital marketing.

PR Smith uses the acronym SOSTAC to define the process of creating a digital marketing plan.  In fact, it is such a useful system of planning development, it can be used across marketing planning.  It stands for Situation, Objectives, Strategy, Tactics, Action, Control.

Social Media is a single communications channel.  It is a tactic not a strategy.  It seems that some operating in the field of social media marketing have forgotten this and treat their speciality as an overarching marketing strategy.  It isn’t and it should not be treated as such.  By all means use social media marketing in your business but that activity should be the result of a careful analysis of your businesses market position and the attributes of your target audience.  So,if I was promoting a fashion brand to teenagers, social media would be a priority communications channel and I would likely want to invest heavily in it.  If I was promoting stair lifts to pensioners, I would prioritise more traditional forms of marketing communication.  It seems some marketers operating in the field of social media have developed a myopic view of communications which may be of little use to many small businesses.

Then there was the title of the talk, “Things you MUST do”.  Sorry, but that is plain wrong.  It infers that the activities MUST be carried out by all businesses.  Surely a better approach is to carry out those activities which best fit your business model, your client base and your available resources.

The speaker had previously worked for a major motor car manufacturer and had now set up their own social media consultancy.  The talk was to small businesses most of whom were either one-man-bands or had fewer than five employees.  There seemed to be little recognition from the speaker as to the resources available to the speaker’s former employer than to the attending audience.

I will quickly list the five things the speaker highlighted:

  1. Using Live Video
  2. Becoming a LinkedIn all-star
  3. Asking for emails
  4. Spending some money as organic reach was dying on social media sites
  5. Getting creative.

The idea that small businesses would be able to produce suitable Live Video seemed a stretch.  Having organised press conferences and media events, I can attest to how difficult it can be to produce successful content on a recorded basis, let alone live.  Sometimes the most confident CEO can turn into a blathering idiot the moment a camera is thrust in their face or a microphone pushed under their nose.  If you are planning such an event, it is always best to have someone with sufficient media training to run the event and to prompt nervous participants.  In my old career, I worked with the likes of Lynn Faulds Wood, John Stapleton and Carol Smylie.  These are broadcast journalists and presenters who could expertly direct those not used to such exposure through an interview.  This is an important skill which many small business people will not have.

The live video idea was mentioned for things like product demonstrations and launches.  It is always worth remembering Murphy’s Law; if anything can go wrong, it will.  I have seen hilarious examples of content from product demonstrations that have gone horribly wrong.  At least those will be remembered.  What is far worse are dull, boring demonstrations which do not stick in the mind.

Live video content is not as easy as it appears, particularly if you are doing an activity such as product demonstration.  Channels such as QVC tend to use employed product demonstrators to give a professional gloss to product launches and ‘how to guides’.

Dee et Al. (2007) argued that social media was increasingly important in influencing consumer perceptions about brands.  They argued that there was a big difference in what was appropriate content depending on factors such as age demographics, gender and the type of product.  They found very few product types which had popularity in all market segments e.g. movies, cars and restaurants.  In short, you need to carefully analyse your target customer segments and design appropriate content.

Microsoft, who part own Facebook, increasingly expect businesses using that platform to pay for the promotion of commercial content.  They are also adamant that consumers must be able to interact with the brand content.  They advise:

  1.  You must understand your customers motivations for using social media.  That content must match the topics they already discuss and match the life stage of those networking.
  2. You need to express yourself as a brand.  A logo and a brand name are not enough.  You have to develop a brand personality which includes a side of the brand not normally seen.
  3. You must understand the consumers motivations for the use of social media and mirror motivations.
  4. You need to create and maintain good conversations.  Those discussions must resonate with the audience and once started a conversation must be followed through. I follow a number of small business networking groups on twitter.  the bad ones are where people end up tweeting about their dogs, the weather or their holidays AND DON’T STICK TO THE SUBJECT OF THEIR BUSINESS.
  5. You have to empower participants.  Let those who network with you express themselves through your brand.  This could be through the use of apps or widgets
  6. You need to identify and nurture online brand advocates and use reputation management tools.
  7. You have to follow the golden rules of Social media
    1. Behave like a social networker
    2. Be creative
    3. Be honest
    4. Be individual
    5. Be conscious of your audience
    6. Update regularly

One firm which is at the forefront of the use of social media for marketing is Ugg, the sheepskin boot manufacturer.  They identify brand fans and give them opportunities to work for Ugg.  They use celebrities as brand advocates and they pay a number of bloggers and vloggers to develop a brand community.  These bloggers don’t only write about Ugg products but they discuss wider ‘youth’ issues such as music and wider fashion trends.

Ugg are very careful that the brand advocates match their brand image.  They were furious when Oprah Winfrey promoted their boots on her television channel as she was outside their young fashion-conscious demographic.

In Digital Marketing, Dave Chaffey discusses the advantages and disadvantages of using social media to develop viral marketing campaigns.

He argues that social media, used correctly, can be a relatively inexpensive viral agent to speak to a large audience and that it can be a good tool for developing customer referral through electronic word of mouth.  However, he warns that for that activity to be truly productive you already need to have the ear of major market influencers.  This can be evidenced in Ugg’s use of celebrities and paid bloggers.

Chaffey also argue that social media can be a high risk marketing communications strategy.  It requires significant initial investment to develop the ‘viral agent’ and to seed the communications programme.

He also warns that many users of social media see the use of portals such as Twitter for commercial purposes as a misappropriation.  People use social media to socialise and during such times do not want to be pestered by brands.

It is often difficult to develop appropriate content for social media channels.  It has to engage the audience and encourage sharing.

Then there is the need to seed the viral activity through the use of key influencers,  This can backfire.  For example, several sports personalities have received criticism when they have promoted products through social media without mentioning that they are being paid to do so.

If a piece of social media goes viral, it can break one of two ways.  It can generate a positive reaction or it can be negative.  It is extremely difficult to judge which of these two paths a viral campaign will follow.  There may well be a need for ongoing and vigilant reputation management.

In conclusion, on its own, social media may not be a sufficient strategy for small businesses.  You need to back it up with more traditional marketing communications activities.  You need to look at your customer engagement ladder.  For many businesses, social media should be focussed on the retention of existing customers than on new customer acquisition.  At best, it is a route to turn existing regular customers into brand advocates.

Social media and other online activities only work well when they are part of a wider marketing communications mix AND you have the time and resources to commit to the social media channel.  You need to decide whether social media is going to be a continuous activity or whether it is going to be part of individual campaigns.  If continuous significant ongoing investment is required.  You also need to balance investment between individual online tools and monitor the return that the investment brings in.  There is no point in having a hugely successful piece of online content if nobody buys your product.

I believe many smaller businesses see social media as a quick and easy fix to their promotional activities.  It isn’t.  It is a tactic which requires careful consideration of viral content and you need to attract key social media influencers.  If those things are not achieved, intensive investment in social media can be a huge waste of time, money and effort.

Ethics in marketing

The other day, a sponsored tweet appeared in my twitter feed for an out fit called King Casino.  The tweet urged me to visit the company site stressing that there was an error in the way the site operated which could lead to profitable winnings.

This tweet was a fairly obvious scam.  The website in question was very similar to a major online gaming firm and I suspect the tweet was nothing more than an attempt to dupe gamblers of their cash.  The tweet breached both the ASA and OFCOM codes that “marketing material must not materially mislead or be likely to do so”.

It was hardly an ethical attempt at marketing a product and brand.  in fact it was likely in breach of the Consumer Protection Regulations 2007 or be classed as a fraudulent activity.

But it not only con merchants and fly-by-night operators who are concerned about business ethics.  Marketing academics and economic theorists have struggled with the concept of ethical business practices for decades. Some large corporations have suffered significant reputation damage because of poor ethics.

Take General Motors who, in the 1960’s, were at the centre of a massive scandal over their use of cost-benefit analysis over the recall and repair of the ‘sporty’ Corvair.  The subject of Ralph Nader’s book, Unsafe at Any Speed, the unsafe design and GM’s response to fatal accidents involving the Corvair resulted in a major political scandal and significant amendments to America’s consumer safety laws.

GM had designed the Corvair with no anti-roll bars.  This meant that when cornering at even relatively low speeds the car would flip over.  The result was several fatalities on America’s roads.  it was clear that the car needed to be recalled and anti-roll bars fitted.  Instead GM used cost-benefit analysis to compare the cost of compensating the families of those killed in accidents involving the Corvair with the cost of recalling the cars and making them safe.  The compensation cost was a lot less than the cost of repair and therefore GM decided to allow dangerous vehicles to be used on the road knowing the likelihood was further fatalities.

Nader, at the time a prominent journalist, was given leaked copies of GM’s internal documentation on the Corvair and made them public.  In the 1990’s he stood as an independent candidate for the presidency.

Karl Marx, as part of his Communist Manifesto espoused the belief that resources should be allocated on the principle of “From each according to his ability, to each according to his needs”.  Milton Friedman was a proponent of a more laissez-faire approach to the market; one which was all but free of regulation; arguing that the only ethical duty on business was to increase profits.

However, even Friedman suggested that there were some ethical boundaries on ‘let it rip’ capitalism in relation to deception and fraud.

Increasingly marketers look to corporate social responsibility to drive a brand.  The Chartered Institute of Marketing recently surveyed ‘Millennials’ and found that CSR was a major factor in their purchasing behaviour.   The concept of CSR operated on the concept of good business ethics producing good business results in the long-term.  Lindsay Owen Jones, a former CEO of L’Oréal stated, “Business ethics are not a restraint that companies impose on themselves for simply moral reasons.  It is also the most efficient way of doing business in the long-term”.

One of the main aims of marketing is customer retention.  Acting unethically will likely harm the ability to retain customers.  If you scam your target market, it is unlikely that they will come back and repurchase.

Philmus Consulting is a full member of the Chartered Trading Standards Institute, the professional body for consumer protection law enforcers in the UK.  As such guidance and marketing plans produced by the firm are duty bound to comply with the law.

Philmus Consulting is also an associate member of the Chartered Institute of Marketing and abides by the CIM professional marketing competencies including recognition of the importance of compliance within corporate reputation maintenance processes (e.g. knowledge of relevant legislation and regulation).  Responsible behaviour includes working in such a way in that it considers the impact on stakeholders, organisational goals and the wider environment.  As a result Philmus Consulting’s activities Should comply with the principles of good corporate governance, risk management and relevant legislation.

Building a brand: The brand identity prism

Building a brand is more than giving your products or company a name.  It is more than picking a logo.  You have to give your brand an identity.

Research has shown that consumers buy brands which match their needs, aspiration and personality.  Therefore, if you want to create a successful brand which attracts your target customer base, the brand must conform with your target customers expectations.

One way of doing this is the concept of the Brand Identity Prism.

The prism is a hexagon and each facet of the hexagon relates to a brand characteristic.

The characteristics are split into four categories:

  1. The picture of the sender, i.e. the characteristics the brand owner wants to project about the brand.
  2. The picture of the recipient, i.e. the image the brand gives of the target consumer
  3. Internalisation, i.e. the ‘culture’ the brand wishes to develop
  4. Externalisation i.e. the image the brand wants to communicate to the market at large

There are two prism facets which make up the picture of the sender:

  1.  The ‘Physique’ of the brand; and
  2.  The ‘personality’ of the brand.

A brand’s ‘physique’ is its backbone, its physical characteristics which provide tangible added value.  A good example is the small round bottle used by the French soft drink, Orangina.  This distinctive bottle shape has been in existence since the brand’s creation.  It gives the brand physical distinctiveness.  Even when you cannot read the bottle label, you can clearly identify the brand.  In recent years, Orangina has also been sold in cans but the round bottle is still at the centre of the firm’s advertising.

Similarly, Coca Cola’s glass bottle shape is a registered trademark and every can of coke has on it a picture of the coke bottle.

Brands also should have a personality and through the communication of that personality a character can be created.  Since the 1970’s brand personality has been the main focus of commercial advertising.  This personality is often expressed through the use of a spokesperson or brand figurehead.  For example, Nespresso want to appear cool, attractive and sophisticated and their coffee machine promotions are therefore fronted by George Clooney.  Virgin Group reflects the personality of its founder Richard Branson in that it is unconventional, fun and laid back.  Tag Heuer watches want to appear sporty and technically excellent so they use brand advocates such as Lewis Hamilton and Tiger Woods.

Personalities can be applied to brand categories.  Companies selling IT equipment want to create a personality which is up-to-date.  Sports drinks want to appear energising.  Ice cream products want to appear sensuous.

brand personalities allow consumers to identify with the brand and to project themselves onto it.  It is the psychological factor of a brand.

The internalisation facet of the prism is a brand’s culture.  A strong brand creates a culture, a vision of the world, an ideology.  Nike’s culture is one of solo willpower with a dose of optimism reflected in the slogan ‘Just do it!’.  Johnnie Walker whisky is a about entrepreneurial spirit and upward mobility expressed through ‘Keep walking’.  American Express sells its credit and financial products by selling the American dream; using the dollar sign as its logo.  Innocent smoothies are about purity and offer a critique on the food industry.  A brand’s culture defines its capital.

A brand is a relationship between its owner and the target customer base.  This relationship is the crux of transactions between people.  Yves St Laurent functions on a culture of charm; a love affair which is sensuous and ostentatious (in a good way): It calls on its target customers to ‘shine like gold’ activating their desire.

Nike use the name of a Greek god to imply specific cultural values; the Olympic spirit combined with human effort.

The Image of the Recipient comprises the final two facets of the prism:

  1.  The reflected image of the consumer; and
  2. The consumer’s self-image.

The reflected image is best expressed by how the general public view users of a particular brand.  The car industry is a good example of reflected image.  People describe cars by the type of person they see driving them.  BMW’s are driven by smart professionals.  Hondas are driven by older people.  Land Rovers are driven by farmers.  Consumers buy brands partly to build their own identity and in doing so they create brand value.

A consumer’s self-image is their internal mirror. It is how they see themselves.  People who buy Lacoste products see themselves as representatives of an exclusive sports clubs.

If you are creating or trying to build a brand, thinking in terms of the Brand Identity Prism can give it a strong and powerful influence in the market.