Archive for the ‘Business & Economics’ Category
Starbucks or McCoffee? No thanks
Starbucks is spending big ad bucks to gain the upper hand in its coffee confrontation with McDonald’s McCafe. What’s important to me about this duel is the false — and ultimately unsustainable — choice this campaign sets up. (UPDATE: McDonald’s announces huge promotional blitz for McCafe.)
According to Ad Age:
The high-end coffee retailer is breaking a series of long form, full-page newspaper ads Sunday (May 3), designed to tell the brand’s “story” while warning consumers about the dangers of trading down. It’s all part of its effort to combat consumer perception about its prices and separate itself from McDonald’s expected mass-market assault for its McCafe launch. Starbucks’ print ads, designed on burlap-sack backgrounds, have headlines such as “It’s not what you’re buying, it’s what you’re buying into.” The ads lay out what separates Starbucks from the competition, such as its practice of buying fair-trade beans and providing health care for employees who work more than 20 hours a week.
Living in Portland, Ore., I can tell you that Starbucks doesn’t separate itself from the competition on the basis of fair-trade, health care or other laudatory practices. That is, if you consider Starbucks’ competition to also include the locally owned, independent coffee merchants and cafes, which we in Portland enjoy throughout our great city.
In the battle of national, publicly owned retail chains, mom & pop’s and larger independents are a complete after-thought. And yet they are the ones who suffer most, along with the communities that are so much better off for having them around. Think Wal-Mart and its devastating impact on local economies and small local businesses as it tries to mow down big-box competitors like Target. The loss of the local independents are simply collateral damage in the national and global business wars.
Assuming I had no other options, I would choose Starbucks over McDonald’s because it’s a more socially and environmentally responsible corporation. That’s what Starbucks wants to hear. What they don’t want to hear is that I actually have dozens of great coffee options and none of them involve McDonald’s or Starbucks. My choices are local and they’re sustainable. I don’t care to choose between who’s less bad. I want to support the business owners who genuinely care about my community because this is their community, too. Large publicly traded corporations ruled by the financial bottom line are “dead ends,” as one socially responsible investment advisor I know asserts. Starbucks may be more responsible than McDonald’s, but that doesn’t make them sustainable.
To borrow the Starbucks advertising punch line, what I’m “buying into” is local.
Tags: big box, fair-trade coffee, independent businesses, local, McCafe, McDonalds, Starbucks, Sustainability, Wal-Mart
Posted in Business & Economics, Communications, Marketing, Sustainability, Uncategorized | 1 Comment »
The endless lengths marketers go to get us to buy
Recession be damned. If there’s a way to get people to part with their money, by God, marketers are going to discover and use it. Today’s example? Neuromarketing.
Apparently there’s no recession in Martin Lindstrom’s business, Buyology, Inc. His firm takes its name from his book “Buyology: Truth and Lies About Why We Buy.” Consumer products companies are flying him around the world to learn what he knows about what Marketing News calls “the last frontier of marketing research: the consumer’s subconscious mind.”
Lindstrom’s book, published in 2008, sets him up nicely as an expert on neuromarketing, which he says “is to use the latest brain science to understand the consumer’s behavior.” Or as his book title says, “Why We Buy.” (I confess I haven’t read it.)
Nobel Peace Prize winner and neuroscientist Eric Kandel has said the ultimate remaining challenge of the biological sciences is to “understand the biological basis of consciousness and the mental processes by which we perceive, act, learn, and remember.” In the last five years or so, this pursuit has spawned neuromarketing.
Just as marketers teamed with psychologists after World War II to create the field of consumer psychology, the largest brands are now looking to harness the methods and technology of neuroscience to study our brain responses to marketing stimuli. Neuromarketing is just the latest chapter in a long history of marketers learning to produce better and better-targeted marketing messages that will lead us to buy.
What struck me most about Lindstrom’s interview in the latest issue of Marketing News (no article link available yet) is this comment:
“My intention was to write a book so, hopefully, the whole world could engage in a debate and say: ‘Are we going too far? And if we’re going too far, should we have regulations around this?’ Now, here’s the bad news on this one. The ethical debate has not appeared so far.”
Lindstrom is right. There’s been no debate. But he’s not going to be the one to spark it, given he claims to work with 17 of the world’s largest brands, 12 of which are using neuromarketing. His vested interest is in seeing this new field flourish, not in drawing attention to its questionable reason for existence.
I would love to see a thorough debate of neuromarketing. Just as I’d welcome a public debate on the ethics of word of mouth marketing. But my concern is less with neuromarketing itself than with what it says about the marketing industry: Will there ever be an end to the lengths marketers will go to get us to buy? After neuromarketing, what’s next? Cloning loyal consumers of our brand? If you want some answers read journalist Lucas Conley’s superb book, “Obsessive Branding Disorder.” Or if you’re intrigued by neuromarketing, read the blog.
If humans hope to have a sustainable future, they must consume less. A lot less. A recession is one way to put a stop to buying. A better way is for the choice to be voluntary. What the world really needs is to understand how to trigger or train the subconscious mind to reject the marketing stimuli that entice us to buy more crap we don’t need and can’t afford.
Here’s a book waiting to be written: “DoNotBuyology: Truth and Lies about Why We Shouldn’t Buy.” If you write it, I’ll buy it. No MRI required.
Tags: brand, Branding, buyology, marketer, marketing research, neuromarketing, OBD
Posted in Books, Business & Economics, Communications, Consumerism, Marketing, Sustainability | Comments Off on The endless lengths marketers go to get us to buy
Greenwashing is just the tip of the marketing iceberg
Greenwashing is a regrettable practice across the business world today. And I applaud initiatives such as the Greenwashing Index to prevent the practice from spreading.
I’m concerned, however, that greenwashing may be distracting marketing executives and educators from an even more distressing matter: The vast number of companies, large and small, that even today don’t give lip service to green or sustainable products or practices. They don’t pretend to be sustainable, don’t promise to become sustainable, don’t understand what it means to be sustainable and, frankly, don’t appear to care.
The marketing and advertising of these companies remain what they’ve always been: attempts to promote and sell products and services, without a hint of green gloss. They stress the usual customer benefits: greater value, quality, innovation, convenience, luxury, responsiveness, ROI and the like. But they make no claims to be more earth-friendly, socially responsible or otherwise green or sustainable. These businesses continue to do what they’ve always done, with no obvious regard or accountability for the environmental or social impact of their actions now or across future generations, except perhaps as required by law, rule or regulation.
I don’t know what percentage of businesses are making concerted efforts to become far more sustainable. I’d wager it’s a small minority. One reason the media features companies that embrace sustainability is they are the exceptions. If every company was going green, there would be no story. And one reason businesses tout the “greenness” of their products or practices (sometimes resorting to greenwashing) is they see a competitive or “first mover” advantage. Again, if all companies produced sustainable goods or services, that advantage disappears.
The point is too few businesses are serious about sustainability today. And that should have brand managers, PR counselors, ad execs, social media mavens and all other marketers up in arms.
I don’t want to minimize the seriousness of greenwashing — no company should be allowed an advantage through false or deceptive marketing. But who should worry us more:
- The few unethical companies (and their marketers) trying to pull the green wool over our eyes? Or…
- The many businesses making truthful, “non-green” claims that contribute to excessive or inequitable consumption and their inevitable byproducts: natural resource depletion, ecological damage, climate change, poverty?
Marketers committed to sustainability have a perfect opportunity in this worsening recession to drive home a critical point among their not-so-green peers: It’s time to examine the very role of marketers in fueling unsustainable economies and ways of living. Or stated more positively, how marketers can get on the right side of sustainability.
Ridding the world of greenwashing would be welcomed progress. Harnessing the creative and persuasive talents of every marketer on behalf of a sustainable world would be nothing short of awesome.
Tags: advertising, brand managers, greenwashing, greenwashing index, marketers, PR, Sustainability, sustainable
Posted in Business & Economics, Climate Change, Communications, Consumerism, Marketing, Sustainability | No Comments »
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.
Tags: brand, brand identity, business identity, customer needs, identity crisis, Max-Neef, mission
Posted in Business & Economics, Climate Change, Communications, Consumerism, Current Affairs, Marketing, Sustainability | No Comments »
No recession in obsessive branding
Journalist Lucas Conley wrote his book, “OBD: Obsessive Branding Disorder,” just before 2008’s financial and economic meltdowns. You would expect branding excess in an economic bubble. But what about in a near depression? If anything, Conley told me in an email exchange last month, the condition he calls OBD is likely to get worse.
“As for OBD in the current economy, I can condense my general observations down to a couple points: consumers are buying less and thinking more. The result of both is that brands are trying harder (either via marketing, discounts, redesigned packaging, etc.) to capture our attention, often driving greater desperation and obsessive branding. Why? When consumers buy less (cutting back on staples and skipping status buys) it means brands have to fight even more for a smaller piece of the pie. When consumers think more (Do I really need this salon shampoo? Isn’t the generic ibuprofen more or less the same as the pricier brand?), they tend to dispel brand myths and discover deals. And any time consumers do more thinking, brands have to fight harder to shortcut their logic with emotional appeals (faster and deeper than logic) or overwhelm them with more marketing, new packaging, etc.”
If Conley proves to be right, and I think he will, the extreme efforts of brands to occupy every nook and cranny of our lives will grow even more frantic and insidious in this rotten economy. And we’re not only talking about consumer products companies. Product and service companies of all stripes are running scared. They could resort to most anything to get customer attention.
Not that any of us would be so guilty, right? Conley says the marketers he interviewed for his book agreed obsessive branding was a widespread problem–it just didn’t apply to them. In other words, they know OBD when they see it; they just don’t see it in themselves.
How about those of us trying to operate our businesses and live our lives more sustainably? Are we better equipped to draw the line when it comes to marketing approaches that offer only the illusion of something innovative, better, unique? Or that deceive customers into believing we offer something they truly need, not just desire?
In this economy, devoted “greenies” in business are not exempt from diminishing prospects. Companies that in good times preach transparency and authenticity in their business practices may be challenged to maintain that commitment as sales rapidly disappear. Numerous incidences of greenwashing in recent years indicate even so-called advocates for sustainability are not above sleight-of-hand branding tactics.
Obsessive branding, Conley argues, distracts companies from what they ought to be doing–innovating. “Real change results from innovation that advances knowledge and improves quality of lives,” he writes. “Branding offers the satisfaction of a sense of change without the hard work.”
There are no shortcuts in the honest pursuit of sustainability. But businesses trying to be more sustainable will also become more innovative. And that will be their ultimate competitive edge.
Want to stand out in this dismal marketplace? Stick to the principles of sustainability. Lead with innovation. And when it comes to your brand, seek the middle ground between neglect and obsession.
P.S. A special note of thanks to McClenahan Bruer Communications, my previous agency, for hosting and introducing me to Lucas Conley last fall.
Tags: brands, consumer products, greenwashing, inovation, Lucas Conley, marketers, OBD, Obsessive Branding Disorder, Sustainability
Posted in Books, Business & Economics, Communications, Consumerism, Marketing, Sustainability | 3 Comments »
Sustainable Industries offers up 9 trends in 2009
Sustainable Industries magazine has just issued its top 9 trends for 2009. They are not posted online, so I’ll summarize them here. (If you’re not a subscriber yet, consider becoming one.)
- Smart grid takes off: “Though the term ‘smart grid’ is somewhat fluid and encompasses a range of technologies—from so-called smart meters to home area networks—analysts and industry insiders seem to agree the time is at hand for many such technologies to be widely implemented.”
- Year of the carbon market: “At a time when U.S. unemployment rates are reaching levels not seen in decades, the carbon market is likely to go on a hiring blitz in 2009.”
- Green building sets the code: “While 2007 and 2008 proved big years for the widespread adoption of building standards by major cities—including Los Angeles, Boston and Seattle—the coming year is expected to bring even more.”
- Banks for the new economy: “With the collapse of giant financial institutions in the third quarter of 2008, some industry experts are predicting a bigger push toward a community-based model of banking and investing in 2009.”
- Green jobs hiring blitz: “The West Coast, with its state renewable portfolio standards, the California Solar Initiative, massive wind power plants and strong venture capital presence, is well-positioned to lead the growth of the green-collar job sector.”
- Tapping into water conservation: “While some companies are already viewing water as the next oil—and are starting to prepare s if the world is approaching ‘peak water’—2009 will bring a new wave of water conservation efforts among U.S. organizations.”
- Get on the bus: “Simply put, Americans think life is better when they have the option not to drive.”
- Solar’s future luster: “Despite what could be a rough 2009—or at least a rough first quarter of 2009—analysts remain optimistic about the (solar) industry’s long-term future following the ITC extension and a new administration stepping in to Washington, D.C.”
- ‘Go green’ goes down: “(B)ecause the media and its consumers have matured a bit in relation to what they view as truly ‘green,’ companies need to stretch much further to garner attention for their environmental initiatives.”
Overall, the trend report suggests an economy that will continue to transform itself in the face of a deep recession. Progress may slow some next year, but sustainability is no passing fad.
Tags: go green, green jobs, peak water, smart grid, sustainability trends, Sustainable Industries
Posted in Business & Economics, Marketing, Sustainability | No Comments »