For Lust of Loyalty

© Tom Fishburne

© Tom Fishburne

A recent study from the National Opinions Research Center found that almost 15% of married women and 21% of married men admitted to having extramarital affairs at some point throughout their marriages [1].

Let that sink in for a second.

Now, consider how most brands today believe that these same people are unwaveringly loyal when it comes to the brand name of shampoo in their shower. Or the logo on their sneakers. Or even the insignia on their automobile. Point is, our assumptions of how loyalty works is often incongruent with the reality of what loyalty is.

In his book How Brands Grow: What Marketers Don’t Know, market researcher Byron Sharp builds on a wealth of empirical evidence to suggest that, despite all the pontification from marketing professionals, customer loyalty is largely a myth. His findings underline the important (and often overlooked) Duplication of Purchase Law which states that all brands within a category share their customer base with other brands of similar size. This explains why 72% of Coke drinkers in the UK say they also drink Pepsi, for example [2]. It also explains why even the most ardent brand advocates aren’t always brand exclusive.

Martin Weigel articulated this masterfully in his essay The Liberation of Magic:

“Loyalty is much more like an open marriage than one characterized by unwavering monogamy and devotion… Irrespective of the category we examine, we see that the vast majority of buyers are in fact not loyal to a single brand. Devoted loyalty – borne of the belief that other brands just aren’t as good, or just aren’t the same – does not exist. Instead, consumers are perfectly happy to buy from a repertoire of brands.”

There are plenty of marketers out there today that have built bonafide businesses by throwing around language like fansambassadors, brand activists, and loyalty. And there are just as many B-school whitepapers saying things like, 1.5% of shoppers drive 80% of sales for the average new CPG product; or, the top brand buyers are almost 6 times more likely to try a brand’s new products than average shoppers [3]. And those aren’t entirely moot points.

But fandom is fool’s gold. As Karen Nelson-Field of the Ehrenberg-Bass Institute cautions, too many brands are “putting a disproportionate amount of effort into engagement and strategies to get people to talk about a brand, when [they] should be spending more time getting more light buyers.” True talk. The lust for loyalty is a siren song for companies needing to address actual business problems. Fans may give brands reassurance but rarely do they increase revenue or market share or household penetration or any other real, bottom-line business metrics.
* * *
The Institute of Practioners in Advertising (IPA) has been mining marketing effectiveness measures from more than 1,000 brand case studies over the past 25 years. Their research shows that loyalty campaigns underperform on almost every business metric. They also found that only 9% of loyalty campaigns increased loyalty significantly — not much higher than non-loyalty campaigns in fact [4]. And this actually makes quite a bit of sense. As Les Binet and Peter Field explain in Marketing In the Era of Accountability, talking to existing customers is fundamentally less rewarding because:
  1. there are usually fewer of them than non-customers, and
  2. they are typically more influenced by product experience than by communications.

Binet and Field use this IPA data to demonstrate that across nearly every category, “superfans” represent such a small segment of potential customers that it doesn’t even come close to reaching a critical mass for communications. You know, the majority of Nike owners don’t have a logo tattooed across their chests. And even among those select “passion brands” that seemingly have an unyielding consumer allegiance, communications are less likely to influence purchase behavior — which may explain why a brand like Apple has deliberately ignored ambassador outreach, centralized CRM or even social media engagement in general.

So while building brand loyalty has become one of the more popular marketing mantras of recent years, it’s important to at least acknowledge its limitations. It’s not quite the marketing panacea that keynote speakers and best-selling authors lead us to believe it is — at least not when it comes to delivering against hard business goals. Loyalty may be valuable as a marketing output but it tends to be pretty poor as a marketing objective.

David Ogilvy once famously said, “the consumer is not a moron… she’s your wife.” And for some, there may be an uncomfortable amount of truth to that now.


[1] National Opinions Research Center, 2013

[2] How Brands Grow: What Marketers Don’t Know, 2010

[3] Catalina Marketing Corp., 2012

[4] Marketing In The Era of Accountability, 2007

The Data of Disillusionment

There was a moment this time last year following the Sandy Hook Elementary School massacre when the U.S. government contemplated passing stricter legislation for gun background checks. Public sentiment was surging. It seemed inevitable. At least that’s what the data showed. One ABC poll, for example, found that 91% of Americans would support a law requiring background checks on people buying guns at gun shows [1].

But nothing happened.

Nothing.

The U.S. Congress did what the U.S. Congress does best: nothing.

I wasn’t necessarily upset by this. I wasn’t happy either. I wasn’t pissed nor pleased nor particularly fearful. I was, more than anything, confused. Because as the the word ‘democracy’ — which comes from the Greek dēmo meaning ‘people’ and kratía meaning ‘rule’ — so clearly suggests, there should be some relatively quantifiable relationship between the things that the citizens demand and the things that the government delivers.

To be clear, I work in advertising. I know very little about the culture of federal politics. Partisan posturing. Legal lexicons. Too much of it makes too little sense to me. But I don’t think you necessarily need to work in a creative industry to feel this lost. You just need to be a normal, everyday American citizen.

Consider this: at the end of 2013, the approval rating of Congress slumped to 9% — the lowest Congressional approval rating on record [2]. Which, to me, is all the more confusing considering that over 90% of these Congressional representatives got re-elected that same year [3]. Maybe I should stick to coming up with ideas for ads.

One of the (few) job requirements of mine that may bear some relevance is the study of consumer attitudes and demographic segmentation. I spend hours upon hours exploring trends, conducting interviews and combing through nationally-syndicated consumer research databases where I can explore, for example, how often Asian American homeowners in Southern California with a median income range over $100,000 tend to purchase organic produce at mass merchandisers like, say, Walmart. There’s obviously much more to it than this but you get the point. Now while I caution my colleagues and clients ad nauseum on the dangers of overextrapolating specific data points, some things are just too peculiar not to poke holes in. Especially when it all starts stacking up like this:

  • In the 113th United States Congress, there are still only 102 women — less than one-fifth (19%) of all representatives and delegates [4].
  • Despite accounting for 17% of the American population, Hispanics only represent 8.5% of Congress [5].
  • There are only 42 African Americans out of 535 Congressional seats [4].
  • More than 9 in 10 members of Congress hold a Bachelor’s degree (as high as 99% in the Senate) although that number is a little less than 3 in 10 of all Americans over the age of 25 [4].
  • For the first time ever, members of Congress had an average net worth of $1 million or more, whereas nearly 50 million Americans today still live below the poverty line [6].
  • No one on the Supreme Court has ever been a blue-collar worker and the average member of Congress spent less than 2% of his or her pre-congressional career in working class jobs [7].
  • And the average age of House lawmakers and Senators is 57 and 62, respectively, which may help explain why there’s so much CSPAN footage of guys like Robert Byrd (RIP) in mid-snore during Senate hearings [4].

So color me a cynic but I just can’t seem to rationalize, given such vast disparities in demographic (and, consequentially, psychographic) data, how these members of Congress could ever be considered ‘representatives’. Not in the way that word suggests. Not for me at least. But then again maybe that’s just the unmarried, middle-class, under thirty-years-old Millennial with a household income sub $100,000 in me talking. What do I know?

In the end, we’re all just numbers.

 


[2] Pew Research Center, 2014

[3] Center for Responsive Politics, 2013

[4] Congressional Research Service, 2014

[5] U.S. National Census, 2013

[6] U.S. Dept. of Health & Human Services, 2014

[7] Nicholas Carnes, White Collar Government: the Hidden Role of Class in Economic Policy Making 2013

A Different Game Plan for Super Bowl Advertising

Every year tends to elicit the same reaction from me: the only thing worse than this year’s Super Bowl commercials are the people who love to shit all over this year’s Super Bowl commercials.

As Benjamin Disraeli once said, “It is much easier to be critical than to be correct.”

And while I share the public’s general disappointment in Super Bowl advertisements every year, I find it more helpful to focus on the really clever advertising that all too often gets overlooked amidst all the animals and the babies and the patriotic platitudes.

A couple of years ago, television’s most recognizable investment guru Jim Cramer gave Apple glowing reviews for their advertisement during Super Bowl XLVI. But the most interesting thing about this particular spot was that it wasn’t actually a spot at all. As Cramer explains:

“There was one ad that struck me as the most honest, most riveting and most compelling of all. You see, the game had just ended, and Colts great Raymond Berry ran the Giant gantlet with the Lombardi Trophy. Suddenly it seemed like every other Giant pulled out an Apple (AAPL) iPhone to snap pictures of the moment. One after another after another. Of course, it wasn’t an ad. It was just a collection of the most cool, most idolized competitors in the world whipping out their favorite device, which they had on the field, ready for action.”

Cramer’s observation was especially astute given the fact that one of the iPhone’s main rivals at the time, Samsung, ran a 90-second in-game television commercial chastising iPhone owners, estimated at upwards of $10 million for air-time alone.

A few years ago, Old Milwaukee tapped comedian Will Ferrell for a celebrity endorsement during the Super Bowl. But instead of purchasing a full-price television spot like Budweiser or Miller or Coors, Old Milwaukee instead opted to run a low-budget commercial limited to a local affiliate in North Platte, Nebraska, the second smallest TV market in America. It went viral. TIME magazine called it “one of the best and weirdest Super Bowl ads around.”

In other words, brands don’t necessarily need to chuck up $4 million for a 30-second slot (forget all the other astronomical costs) in order to make an impact during the Super Bowl. Just ask Newcastle.

That’s why Esurance’s “Save 30″ is such a smart strategic approach. The thing that made this commercial particularly powerful was that the message was also the tactic. Esurance transformed a traditional, one-dimensional product benefit (saving customers 30% on insurance) into an actual media strategy (saving 30% by advertising after the game). Brilliant.

Of course, the cantankerous creative savants within the advertising industry may bemoan that lack of creativity required to produce what was essentially a social media sweepstakes. I get it. After all, this type of “social engagement” can be cheap. And, yes, the full #EsuranceSave30 campaign is certainly a glorified gimmick, making audiences everywhere believe that it’s easy to cash in big for doing little more than being in the right place at the right time.

But one could just as easily say the same thing for all those big budget brands aiming to buy some highly coveted television airtime during the Super Bowl every year.

This was just too good not to include. And it's Gino Bona, so there's that.

This was just too good not to include. And it’s Gino Bona, so there’s that. Can’t say I don’t disagree.

We Are What We Search For

Bill Tancer wrote a book back in 2008 called Click. The general premise was that the way in which we search and browse the Internet can actually reveal a lot about ourselves — both as individuals and as society at large. It notes how “we tell Google what we want, who we’re interested in, how we are feeling” and makes the salient point that “we are what we search for.”[1]

This is why Google’s annual Zeitgeist, a review of the world’s most popular searches and trends of the previous year, makes for such an intriguing cross-section of cultural examination. In the digital age, our online searches — not unlike like the cave paintings, city ruins or ancient scrolls of bygone eras — become valuable artifacts of our fleeting life and times on Earth.

Which brings me to Miley Cyrus. Naturally.  Because of the 5,992,000,000 Google searches done around the world each day (yes, that’s over 2.16 trillion in 2013 alone), it is truly a wonder to see how global interests concentrate around certain people, places and events throughout the year – particularly the popularity of people like Miley [2].

Granted, certain search queries are deservedly predictable. Nelson Mandela was the most searched field in 2013 — all the more impressive given the majority of these searches came on the heels of his death toward the very end of the calendar year. Global news events such as the 2014 FIFA World Cup (12th most popular search) and intense human interests stories such as the Trayvon Martin case (40th most popular search) had understandably captivated widespread attention. And, really, how could heartwarming stories like The Make-A-Wish Foundation’s Batkid (100th most popular search) not go viral?

But then you consider things like this:

Robin Thicke was the 33rd most searched item in 2013 — a whopping 64 spots ahead of Edward Snowden, a man who the New York Times recently praised as a whistleblower of historic proportions and one who “has done his country a great service.”

There were more web searches for Grand Theft Auto 5 cheat codes than there was for news, information or backstory on the Syrian Conflict, a devastating geopolitical crisis that recently topped a death toll of 115,000 this past October (35th most popular search versus 65th most popular search, respectively).

The ‘New Pope’ (81st most popular search) was merely a blip compared to ‘Kim Kardashian’s Baby’ (44th most popular search). The ‘Government Shutdown’ couldn’t match the release of ‘Playstation 4′. And even the tragedy of the ‘Boston Marathon’ got nudged out by, yes, you guessed it, the ‘Harlem Shake’ (6th most popular search versus the 5th most popular search, respectively).

Now, it would be much too easy to insert some snide cultural commentary here — to lambaste the seemingly lowbrow brain waste of contemporary 21st century civilization. But I am no pundit. I am just a person. Just like you. One who deploys countless online searches every single day. One who has his browser homepage set to a blank Google search bar with a blinking cursor, waiting ever so patiently at virtually any moment to span the world for whatever nugget of information may be needed at the click of a button.

So, yes, we certainly are what we search for. Even if that means, as Robin Thicke so beautifully supplicates in his most recent musical masterpiece: we’re all just animals, it’s in our nature and we can be liberated because we’re all the hottest bitches in this place.

 


[1] Click, Bill Tancer, 2008

[2] Google Official History, comScore, 2014

Stepping Outside Of Comfort Zones

A shot from my latest trip to Vienna, Austria, where everything was a different language... even the language

A shot from my latest trip to Vienna, Austria, where everything was a different language… even the language

 

The Dalai Lama recommends that everyone should, once a year, go some place they’ve never been before. It’s a lovely idea.  The context behind his advice is mostly physical, in geographical terms, but I suspect the implication is that travel can be the doorway to much more transcendent personal experiences.

French novelist Gustave Flaubert once wrote, “travel makes one modest. You see what a tiny place you occupy in the world.” That one stings a bit. But it’s the necessary nudge away from our inner motivations and our grossly overinflated sense of self-importance that makes life remarkable in the first place. We are, after all, merely specs of space stuff.

And that’s important because in outer space, nothing is familiar. U.S. Navy psychologists have even coined the term ‘capsule philosophy’ as a way to describe how the psychological effects of space flight cannot be truly known until a man is actually in space. It’s a useful metaphor for how we exist whenever we travel to far off countries or uncharted lands or a new local restaurant that we’ve never eaten at before. Everything is new and captivating and terrifying and exhilarating.

It is easy to hypothesize and it is easy to assume and it is easy to judge from the comfortable vantage point of your couch where the imprint of your own butt cheeks have worn the cushions flat from years of committed stagnation. But it’s much more effective to actually experience the world first hand like the impressionable, vulnerable and curious creature you were designed to be.

You don’t necessarily need a plane ticket. Just an occasional retreat. Because it’s not just about what you may gain from occasionally stepping outside of your comfort zone… it’s also about what you may compromise if you don’t.

Beyond the Era of Big Bullshit

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Have you ever noticed how “Big Data” (along with the “Growth of Mobile”) has been unanimously crowned the “Biggest Trend of the Year” for the past 8 years now?

Big data is a big idea to wrap your head around. But as I often find, sometimes the most massive, momentous, monumental things in life are the products of surprisingly simple realizations. Which is why I resisted writing a long, rambling synthesis of my own personal experiences and opinions on big data and opted to let these two simple quotations spit some truth instead.

“The era of “big data” is quickly becoming the era of “big bullshit” — bullshit on a grander scale than ever before. We’ve always had ability to bullshit with words. Now we have the ability to bullshit with math. We’ve always had bullshit artists. Now we have bullshit scientists.” – Bob Hoffman, the Ad Contrarian

Always In Search of Awe

[WATCHGoPro goes inside one of the Marine’s most terrifying water training scenarios

There is a great line in Chuck Palahniuk’s Invisible Monsters that says, “all God does is watch us and kills us when we get boring. We must never, ever be boring.”

It reminds me of futurist Jason Silva’s description of the phenomenon known as hedonic adaptation. He describes how human beings are predisposed to perpetuating mental habits and how these habits tend to create comfort zones that we rarely step outside of. It’s biological, really. Overstimulation to the same stimuli again and again and again leads your brain to map it and, in a way, overlook it over time.

This is why we love art that moves us or why we stare at gorgeous people or why we can’t look away from a disaster unfolding right in front of our eyes. It’s also why I’ve been obsessed with the online films being produced by GoPro lately.

Here’s the thing: it would have been easy for GoPro to focus on function. Like, say, a product video series showcasing the significantly smaller, 20% lighter camera body… or the audio enhanced wind noise reduction technology… or even the 1080p30 screen resolution with time lapse photo intervals. All worthy technological achievements, no doubt.

But fortunately, the good folks at GoPro had enough sense to know that this is not what impels cheap chaps like me to pony up the couple hundred dollars for a piece of head-harnessed machinery. No, that would be much too logical. And suffice it to say that when you’re teetering on the edge a Peruvian precipice with a suspiciously skinny bungee cord strapped to your ankles, wondering whether you’ll ever muster up enough courage to take that plunge from the security of solid ground and the safety of your shitty, stagnant, suburban everyday American life – logic doesn’t do you much good.

The wonderful thing about GoPro is that they don’t actually make cameras. They make defibrillators. Handheld, body-strapped medical devices that remind us that we are freaky little earthly creatures that still possess a pulse. I may never personally descend the troposphere in a Trollstigen-tested wingsuit, but I sure as hell want to watch a professional maniac do it on YouTube.

It just goes to show that GoPro is a brand incapable of being boring. And in some strange, perhaps naïve way, I’m hoping that strapping one of these things to my chest can achieve that same effect for me. Like it will somehow lead me to pursue more adventure in my own life and come back with an exciting story to show for.

And, yes, this is exactly the type of subtle, media manipulation tactics that our college professors had warned us about – unrealistic representations, emotional subterfuge, always wanting more or better or new. But then again, they were all boring old fogies to begin with.

[60 Minutes goes behind the scenes with GoPro CEO Nick Woodman]