Archive for the ‘Current Affairs’ Category

5 ways brands can engage on climate change

2010 tied 2005 as the hottest year on record, according to reports last week. The news came as flood waters overwhelmed Queensland, Australia and mudslides killed hundreds in southeast Brazil. The natural disasters were made worse by global warming, scientists told ABC News.

Brazil mudslide January 2011. (Source: www.wn.com)

Meanwhile, a new poll shows only 40% of Americans believe global warming is caused by human activity. And New York Times environmental blogger Andy Revkin said in 2010 “global warming,  the greatest story rarely told, had reverted to its near perpetual position on the far back shelf of the public consciousness — if not back in the freezer.”

Is that how it is for you? Is climate change even on your radar screen as a business? And if it is, are you doing something about it? Or are you treating it like some harmless object along the distant horizon?

What your brand can do

I won’t make an argument for why you or your business should care about climate change. I’ll leave that to authors like Bill McKibben, whose 2010 book “Eaarth” is an unsparing description of a world already scarred by global warming and a guide to how we must now live in it.

What I would offer are five ways your business brand can engage stakeholders on climate change. After all, a large minority of Americans believes humans are causing global warming and increasing numbers of customers are holding business accountable. On the opportunity side, brand differentiation around climate change is there for the taking in many markets.

  1. Brand as promise: You can’t waffle on climate change. Choose to believe the scientific evidence and climate scientists like this one who states unequivocally, ”We’re observing the climate changing – it’s happening, it’s real, it’s a fact.” Take a stand. Let your stakeholders know your business cares deeply about the trajectory of the world’s climate. Then show them what you’re doing about it through your products, services, operations and culture.
  2. Brand as meaning: Customers, employees and, indeed, all stakeholders are in constant search for meaning. That’s life. Connect what you’re doing on climate change to what matters to your stakeholders. And what matters to most of us is that we and those we care about achieve happiness and avoid suffering. The climate is now on a very unhappy path. Be an example for a different way forward.
  3. Brand as emotion: We all experience basic emotions such as joy, love, anger, sadness, surprise and fear. For many of us, the thought of climate change overwhelms us and triggers undesirable emotions. How much more desirable is a brand that taps into the joy and satisfaction in caring for our planet and its current and future inhabitants?
  4. Brand as story: Humans connect through stories. It’s how we entertain, educate, preserve our cultures and instill values. Your brand is a story. Place it within the Mother of All 21st Century Stories — climate change — and watch as new, meaningful and emotional connections get made.
  5. Brand as experience: No matter what we tell others about our brands, what determines their fates are the experiences others have of them. When someone interacts with your business or product, they experience your brand as a promise kept or a promise broken. Promise to be on the right side of climate change and then give others the experience of standing with you — and you with them — in creating a world hospitable to all.

Five questions your business should be asking

My business inspiration today comes from an unlikely source, Palestinian Prime Minister Salam Fayyad.

Tom Friedman, in his latest New York Times column, credits Fayyad for his leadership in improving conditions in the West Bank. Here’s the part I like. Freidman quotes Fayyad about his approach to governing: “tell people who you are, what you are about and what you intend to do and then actually do it.”

Those are words to live by as a politician. I could imagine them coming just as easily from the mouth of an effective business owner or executive. Fayyad’s simple philosophy can instruct any of us in business, especially after an unforgivable period of corporate excess and ethical lapses have left so many of us staggered, angry and jaded. In this environment, opportunity lies with businesses that act with higher purpose and integrity — the ones that keep their promises.

Here are five questions every business ought to be asking (and answering) today:

  1. What is my business ultimately pursuing? For many companies, the honest answer to this one is maximum shareholder return or more sales or more profits. The pursuit is financial. Not that there’s anything wrong with that. But it’s worth asking, is financial success really what you want the measure of your business to be? Or is money  only an enabler, making it possible to pursue a larger social or environmental vision?
  2. What is my business trying to accomplish? I’ve heard vision described as something to be pursued and mission as something to be accomplished. I like that distinction. For example: “We pursue clean, fresh water for all. Our contribution to this effort is producing low-cost, long-lasting water purification systems for individuals.” I also think of mission as the reason a business exists. We exist to accomplish something. What is that for your business? Is your purpose clear? Does it inspire you and your employees and customers?
  3. What do we promise? Ask yourself what you want every stakeholder — customer, employee, supplier, partner, investor, community citizen — to experience from your business. This is an experience you strive to create for everyone, at all times. It’s what you stand for, the essence of your business. It’s what keeps customers returning and employees staying. And it can’t be taken lightly. As Fayyad has demonstrated, doing what you say you’ll do can have profound impact.
  4. What makes us different? So you’re clear-eyed about the difference your business is trying to make and the experience you want others to have of your firm. The question now is where that places you versus the businesses competing directly or indirectly for the customers and other stakeholders you’re targeting. Study your competitors and what others are saying about them. Ask customers and others what makes your firm different. If you don’t like their answers, you have some work to do.
  5. What makes us relevant? A company may have the distinction of producing the world’s only sustainably made, solar-powered 8-track player, but, really, who cares? Sure, the business is different. It’s also irrelevant! The key is to be distinct and relevant. What do your stakeholders most value about your firm today? Do you matter to them in important ways or only superficially? Survey them to find out.

My work is helping businesses wrestle with these  fundamental questions. It’s far more than a marketing or branding exercise. My clients establish their firm’s reason for being and core identity. They give purpose and direction to the decisions and actions of every individual and group within their company. Best of all they put themselves in position to make a difference — “and then actually do it.”

Sustainable opportunity in a ‘culture of thrift’

A “culture of thrift” may be taking hold in the US. That scares the many businesses that depend on Americans resuming their profligate ways. But if you’re a business leading the way in sustainability, this consumer shift could be just the opportunity you’ve been waiting for.

A Pew Research Center survey in April found Americans of all stripes are reconsidering the luxuries and necessities in their lives. For instance, fewer of us consider microwave ovens, TVs, air conditioners and clothes dryers necessities. In addition, 80 percent of adults have made moves to economize one way or another in this recession, such as shopping at discount stores, eschewing name brands for cheaper alternatives and opting for lower-cost cell phone and cable/satellite TV plans.

Not surprisingly, those respondents hit hardest by the recession, such as losing their jobs or their retirement savings, are more apt to have taken cost-saving steps than those less affected. Even so, Pew Research says:

(T)his distinction doesn’t apply to changing perceptions about what’s a luxury and what’s a necessity. These shifts have occurred across-the-board, among adults in all income groups and economic circumstances — perhaps suggesting that consumer reaction to the recession is being driven by specific personal economic hardships as well as by a more pervasive new creed of thrift that has taken hold both among those who’ve been personally affected and those who haven’t.

Pew doesn’t speculate on whether this new consumer ethic is a long-term shift. The New York Times, however, says we shouldn’t be looking for Americans to return to spending like drunken sailors anytime soon. “The economic downturn is forcing a return to a culture of thrift that many economists say could last well beyond the inevitable recovery,” the paper reports.

Where the New York Times cites the pain this could cause businesses reliant on consumer spending, TIME magazine finds a silver lining for individual Americans:

A consumer culture invites us to want more than we can ever have; a culture of thrift invites us to be grateful for whatever we can get. So we pass the time by tending our gardens and patching our safety nets and debating whether, years from now, this season will be remembered for what we lost, or all that we found.

And what many people are finding in this painful recession is what’s really important in thelr lives: time, family, friends, community, learning, the security of living within their means, doing meaningful work. For businesses down the road to sustainability, this is your silver lining: You’re already where many of your customers are coming to and where they will expect businesses to be in the future. 

Marketing consultant Avi Dan, addressing marketing strategists in Ad Age, says the period we are in now “represents a complete social and economic reset.” He writes:

As consumers learn to live within their means and frugality replaces an abundantly wasteful consumerism, sustainability will become an essential benefit to your customers. Customers will uncompromisingly penalize products and brands that are perceived as wasteful of scarce resources and harmful to the environment, from SUVs to bottled water.

Many, perhaps most, businesses are frightened by this prospect because they have so much catching up to do. Avi Dan is speaking to them when he says, “Marketers will risk being left behind if they don’t rethink everything.”

If you’re among those firms that got serious about sustainability some time ago, you’ve not only rethought — you’ve acted. So smile. The times are now on your side.

The crisis of identity in business

An owner of a popular gourmet restaurant in Portland, Ore., recently told the local daily, “This year is about survival. Not making money, just surviving.” I suspect that sentiment is shared by vast numbers of owners and executives of businesses large and small right now. GM and Chrysler, anyone?

What began as a financial system meltdown is now a full-blown economic crisis that is worsening by the day. For those businesses able to survive this period, there may be a new crisis looming. I’ll call it the identity crisis.

We feel this individually when we’re suffering confusion about who we are, why we exist, what our role or purpose in life is. Psychologist Erik Erikson, who is said to have coined the term, observed that adolescents were especially prone to an identity crisis. Others speak of it as a condition anyone may confront in a period of great change.

Businesses are not immune to this experience, especially when revenues drop precipitously or leadership loses its focus or exuberance. They may not call it an identity crisis, but the existential questions are the same we ask as individuals: What is our role? Who do we serve? What do they need? What do we offer that matters? How are we different? Why should anyone care?

If companies aren’t dealing with doubts like these today, they probably will be soon. Why? Well, look no farther than the headlines that assault us by the hour. Massive bank bailouts and economic stimulus packages, layoffs by the tens of thousands, huge budget shortfalls in state and local governments, warnings of escalating climate change — and widespread perception that things will only get worse.

No one knows what lies ahead. But one thing seems certain. There will be no going back to the way things were. The days of easy credit, unrestrained consumer spending, unregulated markets, cheap non-renewable energy — the basis for our economic “success” and environmental mess — are behind us. The sooner businesspeople accept that, the sooner we can begin the soul-searching work of determining our reasons for being in today’s new world.

According to one reporter, “Researchers have found that those (individuals) who have made a strong commitment to an identity tend to be happier and healthier than those who have not.”

I believe the same applies to businesses. Firms whose success rests on the old order of things — and that means most of us — strike me as most vulnerable to a crisis of identity. Happier prospects await those who create and commit to a mission and organizational identity consistent with the financial and environmental realities that will be with us for years to come.

In my work helping organizations bridge their mission into their brand identity, I see the benefits of clarity, focus and meaning this effort brings.

If you’re among those struggling with the purpose of your firm’s existence, here are two questions worth considering:

How can we become part of the solution to this economic and environmental crisis? The world and its inhabitants need all the help they can get. For too long, industry has let government, social service, environmental or faith-based organizations solve social and ecological problems. There is an opportunity, not just a responsibility, for businesses to answer the call. Identify how your firm can make a difference, choose a path and watch your whole organization come alive!

What are our customers’ essential needs and how can we satisfy them? One reason we’re in this mess is business has fixated on stoking customer desires more than on satisfying fundamental needs. The result has been consumption and waste of a planet’s worth of stuff, with too little human happiness and too much economic disparity and ecological damage to show for it. As the economy tanks, businesses and individuals are getting back to basics.

If you’re wondering what constitutes basic human needs, Chilean economist Manfred Max-Neef identifies nine: subsistence, protection, affection, understanding, participation, leisure, creation, identity and freedom. Seems like a great starting point for giving your business renewed purpose and relevance in the months and years to come.

Marketers look over their shoulders as recession hits

So we’re officially in a recession. That explains those paranoid marketers looking nervously over their shoulders. They know what’s coming.

Most businesses treat marketing as a discretionary expense, making it an easy target for budget cutters. It’s as if marketing is a luxury afforded only when times are flush. Less customer demand, less we can afford marketing, or so conventional thinking goes.

But really, can we ever afford not to market?

It’s natural to want to preserve cash during a downturn. I was an employer for nearly 14 years, so I’m sympathetic. But the tendency is to make deep cuts in marketing when sales head south. Companies often start by reducing or eliminating outside expenses, such as advertising, events, sponsorships, research. And when that’s not enough, they lay off marketing employees, sometimes the entire department.

The net effect of gutting marketing is to stifle generation of customer awareness, demand and retention just when these things are needed most. It’s a penny-wise, pound-foolish decision.

Management guru Peter Drucker contended, “There is only one valid definition of business purpose: to create a customer…Because its purpose is to create a customer, the business enterprise has two-and only these two-basic functions: marketing and innovation.”

Drucker believed “true marketing” starts with customers, including their demographics, realities, needs, values. “It does not ask, What do we want to sell,” Drucker writes. “It asks, What does the customer want to buy? It does not say, This is what our product or service does. It says, These are the satisfactions the customer looks for, values, and needs.”

Notice, he doesn’t equate marketing with branding, advertising and promotion, as it has come to be broadly perceived and practiced today. Above all else, the marketing function is about engaging, understanding and pleasing our customers. It involves deep listening to customer needs and then helping the business respond with innovative products and solutions that satisfy those needs better than the competition. A recession might curtail how much you spend on marketing, but the function remains essential under all economic conditions.

If you’re contemplating cuts to your marketing program, ask yourself this: Do I truly understand my customers, their needs, their values? And is my company converting that understanding into innovative products and services that my customers value over other choices in the marketplace?

If the answer is no on both accounts, then it’s time to restructure and refocus your marketing efforts so they perform their function. Sure, you may need to trim spending here and there in marketing. Taking an ax to it, however, is your worst move. You’ll only sever connections with customers when you can least afford to lose touch.

If you answer yes to the questions, pat yourself on the back. Your marketing is doing its job. So why mess with what’s working? Find ways to preserve the people and the processes you use to market. They are more valuable than ever as the recession tightens its grip and each customer becomes more precious.

Devotion to sustainability as a company doesn’t exempt you from the fundamental need to market in bad times as well as good. In fact, there’s never been a better time to distinguish your company from the competition and prove your relevance to customers. You’re part of the solution to what ails us. Time to let the world know!

No sympathy here as auto woes hurt Big Advertising

I just learned Detroit’s Big Three automakers account for six percent of the revenues of the world’s four largest advertising holding companies. Meaning, if the automakers go down, it will be a painful blow to the firms most responsible for promoting their products. Hmm, let me see if I can work up some sympathy here. Sorry, no can do.

These are the very same agencies that consumed countless barrels of creative fuel bringing us the dream of owning Hummers, Escalades, Expeditions, Yukons, Navigators, Suburbans, Tahoes and other gas-guzzling, climate-killing hogs. I wonder who came up with that delightfully clever idea two years ago by GM to hand out 42 million toy Hummers in McDonald’s Happy Meals and Mighty Kids Meals. Once the kids get their meals, the parents will reach for the toy, and voila, next thing you know they’re with their kids in the Hummer showroom.

The major holding companies — Interpublic, Omnicom, Publicis, WPP — all count a Detroit automaker at or near the top of their list of largest clients. They’ve happily allied with an American industry that Fortune magazine wrote last year has been “getting a free pass on fuel economy for more than two decades. Instead of devoting its considerable technical resources to improving gas mileage, it has been cranking up the horsepower of its engines and selling modified trucks as SUVs.”

And now the Big Three automakers are cranking up the pressure on Congress to bail them out, while the Big Four ad conglomerates hold their collective breath. Detroit automakers are the poster children for environmentally and, now, economically and socially destructive behavior. While the atmosphere warmed, vehicles got bigger. While fuel prices rose, sales of big autos tanked. And while sales disappeared, so did the hopes of local communities whose economies are devastated by auto plant closures.

I’ve seen little evidence any of this has dented the conscience of the world’s leading ad executives. No doubt they’ve been too busy counting profits from their share of the billions Detroit has spent on advertising, including $4.6 billion in measured spending in 2007 alone.

The day of reckoning is now here for big advertising, just as it has been for their auto clients and their clients’ employees and communities. Good folks in advertising, PR and marketing are losing their jobs. My wish is they now find work supporting companies and industries that actually care about our planet’s future.