KIPPERS - prepare to be smoked

And so because of a few greedy financial fat cats who lent money to people who had, at best, a slim hope of making their payments, we’re heading for a global recession where thousands of people will be put out of work and lose their homes. Thousands more around the world will die of poverty and hunger as the developed world pulls in its horns to look after No. 1.

In a way I feel reluctant to blame the Gordon Gecko types who triggered this mess. They were playing in a game with certain rules. They played hard, following the rules, in an effort to maximise returns for investors (and themselves). And look where we are - the bursting of an outsized bubble of interlocking debt. Clearly, the rules were not right and with the latest round of billions of dollars being injected into the system, governments around the world have given a clear indication that they have lost faith in the market (and the system). We have witnessed the end of unbridled capitalism. If you don’t believe me, look at the heart of capitalism - the US - where Fannie and Freddie and AIG, both massive, massive financial institutions are now owned by the taxpayer, making them effectively nationalised companies like in a good ol’ communist state such as Cuba.

But my feeling is that there is something more fundamental going on here. The world is now run on credit and debt (the lack of credit - as banks stop lending to each other for fear the debter will go bust - is the main contributing factor to the global recession). It has become natural for people to be in significant debt. There has been a huge growth in consumer credit, which has amplified the economic cycle and prolonged the recent upswing. In the US, consumer indebtedness is a massive 139% of disposable income, while in the UK it is even higher at 173%. The biggest debt we have is a mortgage and I guess, in a way, paying off a mortgage gives the individual a purpose in life. It is the cornerstone of liberal, capitalist, democratic system.

And yet the next generation, currently 13-28 year old Generation Y-ers aka KIPPERS (Kids in Parents Pockets Eroding Retirement Savings), have no interest whatsoever in saving, let alone make a pact with the devil and take on a mortgage. The current average credit card debt amongst Gen Y is $5,000 and rising. If they’re short, Mum and Dad fix them up and bail them out. But what happens when Mum and Dad don’t have a job any more, and see their Super halve overnight. I foresee great pain for Gen Y-ers, as they are forced to face reality and see that endless prosperity is not guaranteed.

As a result, Gen Y-ers, and consumers in general, will become far more financially aware and will demand simplification of financial products and services. Those banks that respond to this emerging need will be well placed to return to growth after the economy rebounds and enters the next upward cycle.

The death of a living legend

Last Friday, a living legend died. It was a sad moment when his star twinkled no longer and went out in the sky.

Paul Newman was a class act. He was a totally supercool human being, both on and off the screen.

I never met the man. And yet through his films, I feel I did. This signifies that he was a movie star not an 'Act-or'. He was a brand - irrespective of the part he played, we were absorbed by the magical, charismatic soul that radiated out from those piecing blue Paul Newman eyes. He often played roles that had a laconic, minimalist style - a character style that I particularly like. As a teenager I was attracted to the archetypal shrewd, good-guy outlaw roles he played. He played tough guys who were tough without being violent. He played reluctant, mysterious leaders brimming with charisma. He wasn't a trier - he simply did. He didn't do hard, he did smart.

He had a selfless humility, being the last to acknowledge that he was anything special (this coming from, in my opinion, the best looking man to have ever walked the planet, who was also endowed with a searing intelligence and rapier wit). He was also a motivated philanthropist via Newman's Own sauces (even those are great). He used his fame and fortune to do good. And he kept himself to himself, shunning the limelight.

Above all he was a bloody good bloke.

The world is a lesser place with him not in it.

Just call us X...literally

I’m currently working on a presentation for a client. It's about the differences between Generation X and Y, and in my reading, I came across a rather beautiful piece of irony.

Originally labelled as the Post Boomers or the Slackers Generation, only the label Generation X has stuck to describe those born from 1965 to 1979. I dipped back into Douglas Coupland’s Generation X, a book written in 1991, right at the time that this new generation were emerging. Ironically, the book was about a generation that defy labels – “just call us X” he said, yet the label has stuck, and spawned the labels for Generation Y and Z.

Never Say Never Ever

I’m feeling decidedly down in the dumps today, for a couple of reasons.

First, over the past 5 years or so I’ve watched 98, yep, 98 episodes of the Star Trek series ‘Enterprise’ and I've got only 2 more episodes to watch. When I was a kid, I thought Sci-Fi was a load of mumbo-jumbo. I preferred to read factual, historical stuff or novels about interesting characters in unusual situations. My preference was for the US heavyweights – Mailer, Irving, Roth, Wolfe, Updike, you know those guys that you read and you think, feck me, there’s a seriously large and sophisticated brain behind these words. I loved stories, but not stories about green men or bug-eyed aliens.

It’s strange then that as I got a bit older, I started to really get into Sci-Fi. One of my favourite episodes from the Enterprise series is when Captain Archer and his crew come upon a planet with 2 races where one is in desperate need of medical and scientific assistance.

The plot rotates around interfering with a doomed species (Valakians) that dominates a currently lesser but evolving species (Menks) or allowing the species to die and allow the dominated species to evolve on their own without the oppression of the other.

Archer meets with Doctor Phlox and asks him to develop a cure. Phlox says that he doesn't think that it would be ethical to give the Valakians a cure because it would interfere with an evolutionary process that has been going on for thousands of years. Based on his genome studies, Phlox sees increasing skills and intelligence in the Menk that quite possibly would leave them the dominant species - provided the Valakians died off. He suggests that Archer simply let nature take its course. Archer isn't happy with his doctor's dilemma. Doctors are supposed to heal. Phlox says he's a scientist, and must be concerned with the larger issues. He then uses an analogy of early Homo sapiens and Homo neanderthalensis and what would have happened if some well-meaning aliens had interfered. When pushed for an answer, Phlox discloses that he has indeed found a cure.

Though he isn't happy about it, Phlox decides to place his trust in the Captain to make the right choice. When he meets with Archer, he asks the Captain to reconsider. Archer says that he spent the night reconsidering, and that his decision went against his principles. He had to remind himself everyday that until a directive was written that outlined what could and couldn't be done, he was in no position to play God. Archer gives the Valakians a medicine that will give them more time to find a cure on their own.

Good Sci-Fi is about what-ifs and thought experiments not intergalactic shoot ‘em ups and light sabre duels. When we open our minds and imagine what could be possible we’re halfway to creating a solution. Much of modern physics is built from thought experiments - where experiments can’t be performed due to practical limitations but potential practical and ethical consequences can be examined. (Note to myself: explore the use of thought experiments to explain difficult subjects in layman’s terms.) The thought experiment that I recall most vividly is from my days as a philosophy student and it goes like this: A scientist wants to build a bat from scratch. He/She knows every material aspect that makes up a bat and he knows how to put this material together to make a bat. But because he will never know what it is actually like to be a bat then he cannot be sure that he has really made a bat.

In essence, the mix of logic and emotion that combines to make science fiction helps us think the unthinkable; to be innovative, mashing together existing but separate knowledge to create new ways of life and modes of living.

Which brings us to my other reason for feeling a tad miffed. At a recent Joint Propulsion Conference in the US, rocket scientists from NASA, the U.S. Air Force and academia doused my (along with humanity’s) interstellar dreams with ice cold water. The scientists analyzed many designs for advanced propulsion and the calculations show that, even using the most theoretical of technologies, reaching the nearest star in a human lifetime is nearly impossible.

The main stumbling block concerns propulsion. Utilizing the best rocket engines Earth currently has to offer, it would take 50,000 years to travel the 4.3 light years to Alpha Centauri, our solar system's nearest neighbor. Apparently it would take at least the current energy output of the entire world to send a probe with our best rocket engines to the nearest star.

Robert Frisbee, group leader in the Advanced Propulsion Technology Group within NASA's Jet Propulsion Laboratory, has put forward a radical design that calls for a long, needle-like spaceship. In its entirety, the spaceship would weigh a gigantic 120 million metric tons including fuel - the Space Shuttle weighs in at a mere 2,000 metric tons. With all that fuel and a super-sophisticated superconducting magnet propulsion system, it would still take nearly 40 years to travel the 4.3 light years to Earth's nearest neighbor, Alpha Centuri, he said. (So with advances in cryogenics we could easily get someone to the next star system within a lifetime!)

Interstellar missions are big because of the massive amounts of energy required to get moving fast enough to make the trip in anything like a reasonable amount of time. So big in fact we’d have to mine the outer planets to find enough fuel.

Over recent years, scientists like Frisbee, have turned their attention to alternative-propulsion systems that can be developed over a shorter period, say the next 50 years. Nuclear power is a possibility but radioactivity would limit its use to outside Earth's atmosphere, and the politics are positively toxic. Antimatter engines, worm hole drives, warp generating reactors - the conference found most to be utterly unworkable.

It’s a bummer – according to the experts, interstellar travel is bloody hard, takes way too long and we’ll die of old age before we get there. But as Frisbee said, ‘It's always science fiction until someone goes out and does it. All it takes is one breakthrough to make the calculations work’.

I’ll leave the last word to Dr Who who said, ‘Never say never ever’.

Delivering ‘On-brand’ employee behaviour

In an increasingly commoditised market place, where people see less and less difference between products, brands have become more important than ever. People buy brands not just products (unless it’s a remarkable, groundbreaking product), so we need to create positive impressions of the brand. Each year businesses spend vast sums on communications to build their brand but very few businesses, particularly those with a heavy service slant, take measures to ensure that consumers have an experience that is commensurate with the expectations raised by the brand. Many advertising campaigns over-promise because businesses do not prepare employees for delivery.

To build a successful brand it’s critical that you gear your people up to deliver the experience the brand promises. A brand creates certain expectations that are more often than not let down by frontline employees who fail to deliver the brand promise. Many compelling advertising campaigns are undercut and corporate brands are tarnished when a customer encounters a surly employee or is trapped in the voice-mail maze of ‘customer service’.

Strong brands are built on the actions of employees over time. Leading companies fully understand the value of continually engaging employees as their ‘brand ambassadors’. They spot the points where employees’ behaviour has the most impact on perceptions of the brand, and they can identify the organizational barriers that prevent employees from fully supporting the brand. Most importantly, they have developed processes that enable employees to ‘deliver the brand’ effectively and consistently.

There are a number of factors that are driving the need for a sharper focus on the links between employee behaviour and brand image delivery.

There are more customer touchpoints than ever before. Customers interact with companies via more and more channels ATL, BTL, website, mobile, Customer Services, Sales and so on. Each affect channels has an impact on the customer’s experience.

Approximately a third of corporate costs are employee costs. Astute business leaders conduct an on-going examination of productivity and pressure on management to generate greater value from employees.

When employees know how they fit into the organisation's success and understand the benefits of brand alignment they tend to be more satisfied. The result is lower churn, lower recruitment costs and, of course, the benefits associated with staff continuity.

But I guess ultimately its about the growth of the service economy. Manufacturing in developed countries is in decline. Service industries are contributing >70% of GDP. Looking at the automotive industry, most manufacturers make their money from servicing not from flogging cars. (Why then doesn’t a brand position itself as offering a superior ownership experience?)

Linking employee behaviour to the brand promise helps businesses pull in the same direction. This will help to increase conversion rates, customer loyalty and advocacy, word of mouth and ultimately sales. In my experience, many large organisations don’t communicate to frontline staff how they fit into achieving the company’s brand and, ultimately, financial objectives.

By properly aligning employee behaviour (‘on-brand’ behaviour), business vision and brand positioning, an organisation can build a brand that is more credible, more durable and effective, and more clearly differentiated than anything it can achieve with a standalone killer ad campaign or a hot new product. When I say alignment I mean, 1) Employees understand the business’ aims (what needs to be achieved), 2) Employees understand the brand (how the organization wants to be perceived), and 3) Employees know how to behave (to deliver an experience that fulfils the brand promise).

I’d like to give an example of a company that does this well…but to tell you the truth I’m finding it hard to give you one. The company that came nearest to it for me most recently is Mazda. I’ve been taking my Mazda for a service at the same service centre for the past 2 years and I’ve always found the staff to be very professional, knowledgeable and courteous. When I called their customer service line I had a similar experience. I was treated as a valued customer. This is in stark contrast to when I bought the car. I had a painful and protracted 3 hour negotiation with the sales staff. At one point the salesman asked for my credit card to show I was serious, which I promptly handed over. Later, when I got up to leave because we couldn’t make a deal, he accused me of wasting his time. Deal finally done, I felt like I’d been hit with every slippery sales trick in the book – not a nice feeling and most definitely a dampener on the new car excitement vibe. Upon reflection, I figured that Mazda had a firmer control on their call centre than on their franchised dealers.

So aligned employee behaviour is a key enabler of brand differentiation…but it isn’t easy to achieve.

Employees are not hard-wired to deliver experiences that are automatically aligned to the brand; unchecked their responses are largely driven by their personalities. Marketing - the function responsible for developing and implementing the brand - does not control the touchpoints and the employees that have the crucial interactions with customers. Few companies’ internal communication efforts reinforce brand strategy efforts. And employees often don’t see research data; employees often aren’t engaged in the process of defining the behaviours they believe will lead to better alignment of brand positioning and image attributes.

CEOs need to mandate a path to brand enthusiasm; a roadmap to change employee behaviour in line with the brand promise.

Taking an approach from Kim and Mauborgne’s seminal work Blue Ocean Strategy, to make alignment happen, you need to recruit Kingpins, the persuasive, respected influencers in the organization. Once you have these guys, all the other pins will come toppling down. It also helps that because there are usually only a small number of kingpins, it is relatively easy for the Chief Exec to identify and motivate them.

Broadly, and in brief, I see 4 steps to the journey, taking place over 1 to 2 years. The first is to develop a change attitude and educate the workforce about brands (its role and benefits) via the Kingpins. This should include an understanding of the company’s emphasis on delivering an aligned brand experience. The second step is to build knowledge about the brand positioning components, familiarize staff with examples of excellent brand experiences delivered through employees and highlight expectations of behaviour. The third step is to urge employees to believe that they can personally make a difference and that it is in their interest to deliver the brand. Compensation systems should be modified to encourage employees to deliver the brand via incentives and performance reviews. It should be made clear to staff that they will recognized and rewarded for excellence in customer service that reinforces brand image delivery. The final step is for all employees to deliver; to become brand ambassadors that actively and enthusiastically deliver the brand promise and experience to customers.

There is much to be gained from an alignment program, and much to be lost if an organisation fails to do so.

All Hail Fragmentation

As the years pass and you begin to see more candles than cake, is it not part of the human condition to become more philosophical about life, the universe and everything?

The trouble is that these days its damn hard to find the time to do this kinda stuff when us marketers are making it increasingly difficult to know yourself physically, let alone philosophically.

Like millions of other humanoids, I trudge along, with forlorn face and tail between legs, to the local ballbusting supermarket to do the weekly shop. I decided, in advance of my latest shop, to turn the trudge into something positive; to engage in and soak up the Woolies experience, and see what I could learn about myself. And so there I stood in the shampoo aisle - auto pilot switched off, flying on manual. By the time I got to the end of the aisle all that I knew about myself was that I knew less.

Apparently, there are 20 types of hair. Which category did mine fall into? What is dull? How lifeless is lifeless, how unmanageable unmanageable? Is greasy oiler than oily or is oily oiler than greasy? Did it need revitalising, enriching or conditioning? Did it need body?

I gave up; inertia had set in. I finally grabbed a Head and Shoulders that I’d used - I suppose quite successfully - before. But I swear next time I’ll go for that one with the PH balance and guacamole protein.

I moved on to toothpaste. Did I have sensitive teeth? How would I know? Were my teeth cruel, brutal even? How discoloured should my teeth be before special care should be taken to whiten them? How tender do my gums have to be before I need to take some special gunk to fix them? Did I need a pump action? Did I need to defeat Tartar?

The deodorants needed to know if I had mild or heavy perspiration. Well, I thought, it depends on the circumstances. Mmmm…I should go for the heavy to be on the safe side…but what if I have frivolous perspiration; will my pores snap shut and my impermeable body slowly swell with incarcerated sweat? Bath gel: if I go for the delicate version, what if the dirt refuses to budge?

Let us all rise and hail our new leader, Fragmentation, a term which loosely covers the seemingly inexorable disintegration and demise of mass market economics, social organisation, political stability and the nuclear family, the unified self, the nature and grounds of knowledge, and inevitably, the all-pervasive, disconnected arrays of vivid images generated by the increasingly hydra-headed media. As Walter (aka John Goodman) said in the movie, The Big Lebowski, am I wrong dude? Maybe, but you can’t argue that the fragmentation of markets into smaller and smaller segments, each with its compliment of carefully positioned products, is everywhere apparent. Even in the new car market you can have any colour, engine size, bodywork variant, trim level, sound system, safety features and optional extras you like. 20 years ago there were a few toothpaste brands, in Woolies I counted more than 30.

Paralleling the proliferation of products, and reinforcing the trend of micro-marketing, distribution channels and advertising media have multiplied. We’ve witnessed the rise of niche retailers that stock a narrow but in-depth assortment of specific product categories. We’ve also witnessed The Long Tail, a phrase first uttered by Chris Anderson to describe the niche strategy of businesses such as Amazon that sell a large number of items in relatively small quantities. In addition, the number of locational options has exploded with out-of-town outlet centres and retail parks, not to mention dedicated shopping channels and, of course, online shopping.

Advertising options have also burgeoned as a result of the proliferation of everything from local free-sheets and ‘lifestyle’ magazines targeted at specialist audiences to the web. Pay TV has contributed to the demise of broadcasting and the rise of narrowcasting, where highly focussed messages can be delivered to specific groups of people. There is more advertising space than ever before (think about your local hospital, airport or health club). Jameson’s predication, as set out in his 1985 work The Cultural Logic of Late Capitalism, of a ‘perceptual present’, a world of fleeting, fragmented images of hallucinogenic intensity, seems remarkably prescient. With proliferation come challenges for us marketers as it becomes ever more difficult to cut-through and get our brand messages across. There are some tricks you can employ, but I’ll leave that topic for another post.

Thx Herr Peemoeller

It may be un-eco-friendly, and I must say I don’t feel absolutely comfortable about this, but I like cars. My Dad is one of those practical-type Dads who given a few tools can repair just about anything. Just now he pulled the faulty driver’s seat out of his relatively new car and fixed it. I can remember many a time on a cold, winter’s morning begrudgingly handing him spanners and ratchets while he was under the hood graunching his knuckles.

I'm not interested in how cars work. I like to look at them and listen to them. I like to blow my hair back. And I like the thought that they are a means of escape; that they represent freedom and possibility. Thinking of cars as just a method to get from A to B is totally wrong.

My brothers also like cars. From Triumph Stags to Porsches, from Beemers to Jags. So it runs in the family – we like cars.

I thank the Lord then that Henry Ford ignored the “focus group” findings. As he put it, “If I had listened to my customers I would’ve invented a faster horse”.

But if there’s one thing I really dislike about cars then it’s car parks. Now I know they’ve come on a bit lately, but in the main they are piss-stinking, soulless, depressing, concrete-grey-ugly eye-sores. Not to mention the fact that they tend to bring out the worse in humanity, what with the parking space psychology swiftly leading to parking space fury.

And so it was with a more than a little pleasure that I come across this by designer Axel Peemoeller who has worked out the math to create, optically directional car park signage that appears to hang in the air. Found in the car park of the Eureka Tower in Melbourne, there's no technowizardy here, just a man with a can of paint and a few severely skewed letters. The result: mindbending, v smart and surely a Eureka moment. Perhaps a car manufacturer that wishes to position itself as innovative could join up with Mr Pee to create these signs across all major car parks in Australia…Whatever, well done Mr Pee, and thx for making my car park experience just a little bit less painful.