Market research is notoriously misused and abused. The article, citing a forthcoming study (yes, that’s ironic), went on to say:

To predict reactions of a broader public, 31 subjects interested in quitting smoking were recruited for a focus group to evaluate samples from three antismoking ad campaigns: A (a humorous effort that empathized about the difficulty of the task), B (more serious but also empathetic), and C (lighthearted). Ads in each campaign ended by posting a hotline number for help quitting smoking. Researchers measured the viewers’ neural activity as they watched.

The viewers, rating the ads for their power, helpfulness, grabbiness and so on, ordered them B, A, C. But levels of brain activity in a region tied to behavioral change suggested the ranking C, B, A. That ranking better captured real-world performance. For example, Campaign C caused a 32-fold increase in calls to the hotline, in contrast to only a threefold rise for Campaign A.

Having recently conducted research on this very topic, this hit home. We were not using our focus groups to “test” ads (a fundamental abuse of the methodology); we were using them to explore smokers’ thoughts and feelings about their habit and the role it plays in their lives. And we sensed at various points of the discussion that they were lying, perhaps even to themselves.

Not that the groups weren’t valuable; on the contrary, we picked up insights that led to what we believe will be a breakthrough approach. But I’m convinced that the more we as marketers learn about consumers, the less we really  know.

One of the the critical mistakes that can come about as a result of a loss of nerve in a struggling company is over-reliance on market research. It’s easy to hide behind what consumers say on the surface, not to mention the authoritative heft of a market research report. But it’s dangerous.

No one believes in research more than we do. But it must be handled correctly and interpreted in the proper context. Bad research won’t produce good strategy any more than a polluted well produces fresh water. It could, in fact, hasten one’s demise.

I’ve been involved with CRM projects for 15 years now. It all started with the 1998 launch of Campbell’s Soup’s inaugural online recipe box and outbound email program, Meal-Mail® (still called this today). Just recently, the thought crystallized in my mind that I hate – and have always hated – the terms “CRM” and “Customer Relationship Management.”

For a concept that is supposed to be about building a warm, loving relationship with your customers, “CRM” just sounds so cold and unfriendly. It almost sounds like an acronym for a disease. And “Customer Relationship Management” sounds equally impersonal and insinuates that customers need to be managed or supervised. Managing customers is exactly what we are told NOT to do in marketing – especially in today’s world of social media, on-demand TV, smart phone technology and more.

Instead, we should be courting our customers and prospects. Encarta defines courting as, “Trying to gain something such as somebody’s attention or admiration by behaving in ways that are intended to attract or encourage it.”

This, in my opinion, is the key to a successful CRM program. We as brand marketers should work to gain our customers’ attention AND admiration. We should do this in ways that are intended to attract our customers or encourage them to take a preferred action. Which leads me to believe that the word “relationship” is truly the most important part of CRM. If we treated every prospect or customer like we were in a loving relationship with them, we would act differently, wouldn’t we?

As brands trying to foster relationships with customers, we would be more careful and deliberate with our actions. We would create a loving environment that allows them to grow and change with us. And, on the other hand, if we tried too hard, we would eventually drive them away. Successful personal relationships are those that are open, honest, and flexible. Marketers like us should keep these three words in mind as we develop CRM programs for our brands. That way, we’ll start to treat customers like they wanted to be treated. Not how we think they want to be treated.

So who’s with me? Let’s rally to eliminate the term Customer Relationship Management and start to think about the best techniques for Customer Relationship Fostering, or Customer Relationship Nurturing, or Customer Relationship … (I’m open to suggestions).

In addition to revealing significant variations by country in online shopping patterns, the report identified a notable channel fragmentation trend, as desktop and laptop purchases increasingly give way to shopping via smartphone.  According to the report, 19% of consumers have used a mobile device to make a purchase online. That’s one in five people—at a time when many companies don’t even have a mobile website, to say nothing of e-commerce capabilities.

WorldPay’s Philip McGriskin pointed out that the trend “is expanding the audience of potential consumers for merchants to target but, in tandem, presents challenges in offering the best experience for these consumers whenever and wherever they demand it.”

Whenever and wherever they demand it. That should send a chill down your spine.

A world of increasing fragmentation calls for increasing integration. And it’s not even enough to have a fully integrated marketing program—integration must extend to all aspects of the enterprise, from awareness building to transaction processing all the way through CRM.  This trend has as radically changed the way our firm serves its clients as the way they serve their customers.

Not so long ago, it was enough to have great strategy and big ideas. Today, even the best ideas have a hard time getting off the ground as consumers’ media and purchasing options—not to mention their attention spans—grow increasingly fragmented. While perfect integration is unachievable, companies that do the best job of harmonizing all of their consumer touchpoints have a decided advantage.

Those are the words of Texas Governor Rick Perry, made to the media during a barnstorming tour he took with Governors Sam Brownback of Kansas and Terry Branstad of Iowa in an attempt to defend the processing plants in their states that produce what has come to be known as “pink slime”.

You know the stuff. The this-looks-like-raspberry-frozen-yogurt-but-it-isn’t stuff. The stuff that we’ve been eating for years without a complaint and that, by all accounts, is perfectly safe. What Governor Perry was referring to was the fact that an industry that’s important to his state is now in jeopardy simply by virtue of an unappetizing nickname and an ugly photo.

I find this a rather fascinating example of the power of positioning. If you think about the term “ground beef” too deeply, it gets disturbing. But  most of us don’t think about the term too deeply–we’ve just taken it for granted all our lives. And when ground beef is ground all the way down to “finely textured beef” (the industry’s preferred label for the stuff), it’s even less of a big deal. Label it “pink slime”, however, and add a lovely image for good measure, and it’s a whole different ballgame.

Crazy, isn’t it? Nothing about the product has changed, but because we’ve been forced to think about it–and in disgusting terms, no less–an entire industry has been turned upside down. I suppose there’s some irony in the fact that the folks from which we got the term “branding” are now facing a branding problem of their own.

Unfortunately, I expect we’ll see more of this in the coming months as political candidates attempt to brand each other via the same repositioning tactics. And it’s likely to be even more unappetizing.

The rise of Amazon, iTunes, and other online powerhouses has led to a dramatic shift in consumer behavior. The new online business model offers convenience and low prices for consumers and businesses like it because it significantly cuts overhead. However, the ongoing shift in how consumers interact with entertainment retailers has left most brick and mortar companies either barely hanging on or filing for bankruptcy.

Hastings Entertainment, a multimedia retail chain specializing in all of the challenged product categories (new and used books, CD’s, video games, movies, rentals) is doing its best to weather the storm. With 146 stores across much of the United States, Hastings has historically performed well by strategically filling a niche in small to midsize markets, essentially providing big city amenities in small towns by filling the gap between mom and pop shops and Best Buy.

But the rise of Amazon has taken a dramatic toll on profits and sales. An analyst at SeekingAlpha.com described Hastings’ precarious position when reporting “I am not sure one could pick a more challenged area of the retail segment than the categories in which [Hastings] competes” and further “It is unclear to me how this company has managed to survive…”

Although the market landscape looks bleak for traditional brick and mortar retailers, there are two main reasons why Hastings could be positioned to not only survive, but thrive.

1. Strong Foundation
Hastings has continued to defy traditional stock value analysis through conservative management, smart market strategy, and loyal customers; essential qualities needed if Hastings is going to make the uncomfortable changes needed to adapt to the new marketplace. For Hastings’ to survive, it will need to use its conservative management style to increase efficiency while it manages long-term brick and mortar decline. At the same time, it will need to activate and engage its loyal customer base in a way it hasn’t attempted before, using the passion so many feel for the brand to keep it afloat as it evolves with the industry. The question remaining for the management team will be how to leverage the unique niche it has carved out in the market as it ventures into new territory.

2. Brand Idea
The key to adapting to a changing market lies in the entire company rallying around a single, focused, compelling brand idea. Hastings isn’t just an entertainment retailer. Hastings is a thriving community, an organic marketplace, a place where authentic creativity intersects with authentic people. Hastings is an idea. Hastings is the place to find offbeat indie bands, niche movies, and local authors. Hastings could represent the last bastion of what is real in the industry; that intangible quality one can feel when flipping through a paperback or looking through album notes.

As the industry moves from personal touch to impersonal clicks, communicating that intangible quality could be the key to growth. If Hastings can stand for something larger than it’s current business model, it can continue to stay relevant to its customer base while making significant (read: profitable) changes to the way it does business.

Winning the Future

“…when you’re in trouble, the worst path is indecision.”
- Anne Mulcahy, CEO, Xerox

Anne Mulcahy’s wise words represent one of many responses a company can have when faced with an existential threat. Having a strong operational foundation and brand better positions Hastings to navigate the changing landscape than competitors. But in the end, it will be the company’s collective attitude that will make the difference. If Hastings can embolden employees to rally together, embrace change, and pursue innovation like the company’s existence relied on it, Hastings’ future can be as bright as its past.

But if Hastings is struggling with any of the four key internal dynamics identified in When Growth Stalls; lack of consensus, loss of nerve, loss of focus, and marketing inconsistency, then the paralysis of indecision will lead it down the same path of so many brick and mortar giants before it.

As I saw a contraption roll past my gate similar to the one in the photo at right,  I thought about how glad I was that I would be boarding a real plane. After all, who among us hasn’t had just a bit of trepidation when we learn we’re flying on something…well, so small?

But I couldn’t help but chuckle as I reflected on a flight I took on a corporate jet a few months ago—a jet like the one pictured here. Knowing I would avoid the typical airport hassles I was glad to have been invited along, but when I laid eyes on the plane I was even more delighted.  “Look how big it is,” I thought to myself.

You know the punch line. The first jet is actually bigger (thus presumably safer) than the second. Yet my perceptions of the dangers I would be facing in boarding each plane were different–and entirely situational.

I expect a commercial jet to be big. I expect a private jet to be small. Should that expectation be unfulfilled in either direction, it will lead to trepidation on one hand or delight on the other. The fact that it’s irrational makes it no less true.  Or less common.

Expectations are why we’ll part with three bucks for one cup of coffee (or scoop of ice cream) and only seventy-five cents for another.  They’re why we’ll pay ten thousand dollars more for a vehicle that’s all-but-identical to its sister brand other than the badge on the hood.  And they’re why while we might avoid the Golden Arches at home we’ll welcome the sight of them in an unfamiliar place.

What expectations do customers have of your brand? How well are you fulfilling them?  It really doesn’t matter what they are as much as that they are, and that you consistently meet or exceed them. If you don’t, you may find people are hesitant to fly with you.

I recently spoke at a PR conference on the topic of Integrated Marketing. As head of the Integration Architecture department at McKee Wallwork Cleveland, I felt pretty confident in the subject matter but was struggling with a good way to summarize my material. In the middle of the night (when most ideas come to me), the perfect synopsis popped in my head so I reached for my iPhone and entered a note containing four words:

1. Consistency
2. Continuity
3. Perseverance
4. Patience

To me, these four words best represent the traits required to develop, launch, and maintain a successful integrated marketing program. Brands that exhibit these qualities are not only triumphant in their marketing endeavors, but also in reaching their business objectives. Think: Apple, Nike, Coca-Cola, Victoria’s Secret, Ikea, GE, and IBM. Their enduring success is not by accident. Each of these companies has worked diligently over many, many years to implement solid marketing strategies that are integrated throughout the entire organization. How do they do this?

First, they deliberately identify their marketing goals, define their targets, and create distinct identities. This part isn’t easily and quickly done and could be a whole other blog post. I’m going to focus here on what happens next. Assuming those items are in place, the next step is to design a long-term, strategic integrated marketing program. The idea is to craft a suite of tactics that work together to create a seamless experience for the consumer/customer.

Developing this type of integrated plan is tough and requires:

1. CONSISTENCY (harmony between parts): A seamless tactical plan should address each of the Four Ps – Product, Price, Place and Promotion. This requires that various departments across the organization work together. The marketing department should be the liaison between management, operations, R&D, customer relations, IT, sales, HR, etc. to ensure that all facets of the company are focused on making the consumer experience consistent.
2. CONTINUITY (staying the same over time): No matter what industry the brand is in, the four stages of the customer life cycle remain true – Attraction, Conversion, Retention and Engagement. It’s crucial that your communications across each of these stages are unwavering, similar in tone and continuous over time. This isn’t to say that messages or tactics can’t be refined, but the overall brand identity should remain constant.
3. PERSEVERANCE (steady over a long period despite difficulties): Developing and maintaining an integrated marketing program is hard work. It takes discipline and drive to make it work, even more so to make it last. Don’t give up. Keep pushing to ensure the company is working well together to create this uninterrupted consumer experience.
4. PATIENCE (persist despite complexities): With the proliferation of so many new marketing options, it’s easy to say something “isn’t working”. And with the strain of today’s economic conditions, there’s huge pressure on marketers to prove success. This can lead to changes or even overhauls of marketing plans too soon. It’s important to remain calm and stick with what you believe in for your brand. If you deliberately and strategically created a brand platform and coinciding marketing plan, then give it time to work. Think about how long Apple, Nike and especially Coca-Cola have been promoting innovation, motivation and happiness respectively. There’s a reason those businesses are so successful, and it’s definitely not because they gave up and changed direction too soon.

So if your brand can keep these four tenets in mind when designing an integrated marketing program, you will be more likely to see success in your efforts.

According to this study, the ads pictured here were among the top ten most engaging, besting 87,000 others that appeared in national consumer magazines last year. Really. Their “engagement score” was based on the percentage of readers who said they read, or “noted,” each ad along with the percentage who took any action (visited a website, clipped a coupon, recommended the product, made a purchase, etc.) as a result of seeing the ad.

No surprise there. But dig a little deeper and you’ll find an interesting observation. Michael Beird, director of the banking services practice at J.D. Power, says that while fees are “the proverbial straws that break the camel’s back,” they’re not the entirety of the problem. Poor service experiences take customers to the brink, while fee increases simply push them over the edge.

Beird’s observation about customer defection reflects on what might be labeled “hidden inaccuracies” in typical marketing ROI analyses. It’s natural for marketers to conclude that their most recent offer is solely or primarily responsible for attracting a new customer, based upon the data they collect. But if it’s seldom true that a single event would cause customers to defect from a brand, why would we presume it to be true in customer attraction?

In my latest Businessweek.com column I caution marketers to be wary of campaign metrics for just this reason. Data looks so official, especially when ROI analyses show results to the thousandth percentile. But following the data alone would lead banks to conclude that as long as they don’t offend customers with fees they’ll be sitting pretty, when the truth is far from that.

The same is true in customer attraction. You can easily measure redemption rates of a single offer, but they’ll never be an accurate representation of the complexity of the decision process that led up to the transaction. And if your offer includes a discount, there’s no telling–i.e. no way to measure–the long term damage you’re causing to your brand equity.

By all means, measure away. Just be very, very careful about the conclusions you draw. If you’re half right, you could be all wrong.

After revealing its most recent results–a loss of more than $3 billion last year–Sears has announced its own form of quantitative easing. The company will sell more than a thousand stores to increase its money supply by several hundred million dollars.  Sears will then have more than a billion dollars in cash and twice that amount available on its credit facility. Unfortunately, that won’t be enough to fix what ails the iconic retailer.

Sears has had a longstanding problem with an internal lack of alignment, having run through five CFOs and four CEOs in the past seven years. The company has thrown in the towel on its brand and its bonds have been downgraded to near junk status. One credit ratings firm says that despite all of its cash, Sears might have inadequate liquidity within a year and could face reorganization.

Sears’ problems have been well-documented on this blog. Same store sales have fallen for most of the last decade.  All along company Chairman Ed Lampert has been, according to The Wall Street Journal, “confident he could succeed by applying the lessons of investing to retailing.” In an analysis of Lampert’s latest decision the Journal provided this perspective: “Unfortunately, such moves can be repeated only a limited number of times and probably make it harder to turn around the business.” That sounds eerily like a critique of the Fed’s narrowing options.

Believing the answers lie in moving money around rather than creating value is misguided, whether on a broad economic or individual corporate level. In a recent letter to shareholders, Lampert said Sears “has a profit problem, not a liquidity nor an asset problem.” That’s true, but note the lack of  mention of the company’s real issue–the inability to identify a relevant value proposition. Cash is king, but monetary policy is not the main event, in business or in the broader economy. The most vital thing is finding a way to unleash a company’s–or an economy’s–animal spirits.