Marketing & Branding: For the Customers' Sake
By Mark Vanderkam | September 30, 1999
Looking for the answer to your marketing problem? Remember this old adage: "It's the customer"
Imagine you wake up one morning and there is a chauffeur standing at your door and a gleaming stretched limo is sitting in your driveway. You are informed that Accenture has conducted a talent search on behalf of its client, General Motors, and you have been selected as the new vice-president of worldwide marketing for one of the most prestigious brands in the GM roster: Cadillac.
"Could you please put on a suit and get in the car," the chauffeur says. "A private jet is waiting to take you to GM headquarters for your first day on the job."
You arrive at the office and are handed an agenda for your first day:
10:00 a.m. – orientation
11:00 a.m. – SWOT analysis
1:00 p.m. – strategy session
4:00 p.m. – meet stock-market analysts in New York, London and Tokyo via videoconference to announce your new strategy for halting
Cadillac's brand erosion and for boosting sales and image worldwide.
Hmmm. Sounds like a full day, but you should be able to get in a little golf over lunch.
As you get into the orientation session with a roomful of MBAs running through their Powerpoint presentations with stats, bar graphs and fancy graphics, you start to scratch your head. You learn:
- since 1976, Cadillac's share of the luxury-car market has fallen from an astounding 51 per cent to less than 16 per cent;
- over that period, every other major competitor, from Mercedes Benz to BMW to Jaguar to Lexus, has grown its market share at Cadillac's expense;
- in the past 12 months, luxury-car sales have increased by 7 per cent, yet Cadillac's sales have actually fallen by 15 per cent in the same period;
- Cadillac's strategy to lure younger buyers by loading the cars with hi-tech gadgets has failed;
- Cadillac was late getting a luxury sport utility vehicle to market, thereby losing the category to Lincoln's Navigator.
"So," you ask yourself as the first hour draws to a close, "whatever happened to Cadillac?" How could such a strong brand lose all its momentum when it has so many experts and marketing geniuses working day and night to make it succeed?
You ask the VP of advertising to put the latest advertising campaign up on the boardroom's multimedia screen. The lights dim and you see a jet black Catera slide by on a rain-slicked urban street, followed by the tagline: "The caddy that zigs."
Hmmm. Interesting point of differentiation. This car zigs, while the competition, one presumes, zags. You put up your hand to ask an innocent question: "Did Cadillac's customers ever indicate a desire for a car that zigs?"
A young MBA-type with a crew cut pops up: "I can explain that one. Research showed we were not appealing to the BMW and Jaguar buyers, so we needed to create an association with an image which we call the 'inner-Manhattan' look."
"Ah, I see," you say. "Inner Manhattan. I get it. So we believe there are enough potential buyers in Manhattan to turn around our sales numbers?"
"Er, no," the MBA responds. "But research showed that people in middle-America tend to follow trends that come out of Manhattan. So our ad agency reasoned that our target audience would buy more Cadillacs if they felt that the trendsetters in Manhattan were buying the cars."
"And were the trendsetters in Manhattan buying our cars?"
"Er, no. People in Manhattan drive BMWs and Jaguars. Research shows that they look upon Cadillacs as fat-finned barges." Nervous laughter around the room.
"Oh, I see." You decide to take another tack. "Tell me, where is the ad agency located that came up with the zigging-caddy campaign?"
"Manhattan." More nervous laughter. The MBA loosens his tie and wets his lips with a glass of ice water.
"Uh huh," you respond, thoughtfully. "I think my tee-off time is coming up. Please carry on with your meeting. I'll be back after lunch."
With that, you excuse yourself and walk out to the parking lot, where your chauffeur is waiting with your new company Cadillac. As you get in, you notice on the window a little decal that says: "Next-generation airbag." You lean over to the chauffeur and ask, "Could you tell me what a next-generation airbag is?"
"I haven't a clue," he answers, looking straight ahead.
After your golf game, you sit through another round of reports, analyses, theories, suggestions, comparisons and statistics. Finally the hour for the videoconference arrives. Your secretary leads you to the videoconference room. A team of make-up artists goes to work on you while three public relations consultants give you tips and pointers on how to look your best in front of the cameras.
The technician gives the countdown. Ten seconds to go. Nine. Eight. Seven.…What are you going to say?
If this were a real world situation, you would obviously have to ask yourself how such a strong brand could fritter away its leadership position. As a marketing person, the first thing I would ask myself is this: is there a disconnect between Cadillac and its customers?
Why did they miss the sport utility vehicle trend? Why do they put out advertisements with black cars and gaunt models? Are they in touch with the doctors and business people and other luxury-car buyers in the American heartland?
If these buyers have become more cosmopolitan in the last 25 years and are attracted to European and Japanese designs, then why is Cadillac taking the odd strategy of loading up its cars with gadgets, such as "next-generation airbags," solid-state taillights and nifty techno-baubles, rather than focusing on core design issues?
Any company, no matter how small or large, can succeed only by satisfying the needs of consumers. The Cadillac saga shows what happens when a company loses touch.
To succeed in business, marketing managers need to get out of the office and talk with their consumers. They need to go and visit customers who have purchased their product and find out what appealed to them.
They must also find people who considered their product but chose the competition's and ask them to explain how they made their final purchase decision. They need to budget an adequate amount of time for both primary and secondary research, and then apply the understanding they gain to product development.
In the real world, however, most marketing managers don't have time to actually talk to customers outside of tradeshows because they are generally too busy doing other "more pressing" things. This results in product development that is not properly directed.
Why create a software package with 117 features if the market only wants 72? Or why create a product to meet the demands of a small group of dealers or distributors without first checking to make sure that these dealers have properly interpreted the needs of their customers? That kind of product management goes on all the time, and it can damage a company in a hurry.
In next month's article, I plan to talk more about effective research tools and strategies, but for the time being, let me leave you with these three activities, which are fundamental to successful marketing:
- understand the needs of your customers
- leverage your company's distinctive competence to meet those needs
- communicate the advantage of your product or service to the market