Bart's Brief

A painfully effective ad

noreply@blogger.com (Bart) — Wed, 26 Sep 2007 23:05:00 +0000

One of my favorite examples of effective advertising is finally getting some credit in an article in AdAge. HeadOn; You know the ads. An incredibly annoying voice-over repeats incessantly, "Head On...apply directly to the forehead!" while a woman wipes a mondo-ChapStik on her forehead. It makes you want to scream. But I noticed something amazing one time at the gym; when the ad came on, virtually everyone on the treadmills around me looked up at the TVs and stared at it. I couldn't believe it! There is something hypnotic about it's ability to annoy.

Equally amazing is that at no time does the ad really tell you what it does, but it doesn't have to. By the end, they've completely captured your attention and you have an almost insatiable desire to go buy it to find out. Even if you don't buy it, and you assuredly hate the ad, you have still completely internalized their brand message. Mmmm....take stick....rub on head...person smiles...urrrrr....HeadOn good.

Gotta love simplicity!

And, it works. HeadOn racked up 234% growth in 2006 and is on track to double sales in '07. NICE! But as they say in infomercials, "BUT WAIT, THERE'S MORE!" The same approach has produced another hit in ActivOn for joint pain which now outsells HeadOn.

Look fancy ads are great fun, but most of time they simply don't work. The next time your ad agency brings you a concept, if it doesn't CLEARLY, CONCISELY, and perhaps ANNOYINGLY communicate your key value and positioning, send them away. Or, just lock them in a room with the HeadOn ad on a continuous loop until they learn something.

Food humor by Brian Regan

noreply@blogger.com (Bart) — Mon, 30 Jul 2007 20:13:00 +0000

Some funny stuff from Fig Newtons to PopTarts.

CHART SECRETS

noreply@blogger.com (Bart) — Fri, 04 May 2007 20:20:00 +0000

I LOVE CHARTS...., but only when I do them. Let's face it, most charts stink. People perpetually use the wrong type of chart or mess with the scales to trick the viewer. Here's a great article from PC Magazine titled, "Secrets of Readable Charts." My favorite (or should I say most hated) is the "Nonsense Chart." If you produce on of these and work for me, it's grounds for firing (just kidding). After reading this, you'll see why CM Solution has created our own "Best Charts" deck as part of our training curriculum.

PC Mag article on charts

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Husband Daycare: It's time has come.

noreply@blogger.com (Bart) — Thu, 03 May 2007 00:23:00 +0000

This is perhaps the best
idea for a national social program in
history...and a funny video too!

Code Monkey

noreply@blogger.com (Bart) — Wed, 02 May 2007 23:17:00 +0000

This is a hilarious song/video of the plight of programmers who apparently live the same lives as many underappreciated Business Analysts.

The U.S. Supreme Court decision that could change marketing forever

noreply@blogger.com (Bart) — Wed, 28 Mar 2007 20:31:00 +0000

The U.S. Supreme court has agreed to hear a case that may reverse the interpretation of the Sherman Antitrust Act that restricts manufacturers from setting retail prices. As perhaps the most powerful "P" of the four marketing p's, pricing control by manufacturers could radically change the marketing strategies of innumerable brands.

Here's a great summary by the International Herald Tribune:
U.S. Supreme Court case tests minimum price rule

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Kids' spend 15% of time on TV and 6.5% on homework

noreply@blogger.com (Bart) — Wed, 28 Mar 2007 20:26:00 +0000

Check out this interesting article by NPD Insights that analyzes how "tweens" (kids 8-12) spend their spare time. SCARY! But, if you don't understand this, how do you expect to sell to them (and their parents)?!

Club cards don't create loyalty?! DUH!

noreply@blogger.com (Bart) — Wed, 28 Mar 2007 20:13:00 +0000

The Seattle Times ran a story titled, "Club cards: Loyalty in the bag? Not really." Anyone in the industry (that's not a retailer) has long known that club cards create no loyalty. And, customers long ago figured out that the "savings" they were getting are the same discounts they got before without a card.

So, why have them?? It's the data stupid. While many retailers still believe that cards enhance loyalty, the primary reason for their continued use if the new form of data provide. The bad news,...most retailers misuse and misunderstand that data too.

OK, I'll turn off the cynicism now. Card data can be powerful and this article is worth the quick read.

Seattle Times Article Link

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P&G, Islam, and Superheroes

noreply@blogger.com (Bart) — Thu, 15 Mar 2007 01:57:00 +0000

Only P&G could pull off a marketing campaign that involves the creation of a conspicuously western-society superhero that sells soap to an Islamic consumer base with little history of personal hygiene (no offense intended...let's face it...most of the world doesn't see a need for soap).

Gotta love P&G...no [recognized] need...CREATE ONE! Man I miss the good ol' days of outrageously ambitious marketing ideas. God bless you P&G (whichever One your consumers choose).

Watch the very interesting report from Martin Lindstrom of Advertising Age.

See it here.

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Alternate Uses for Corporate Laptops

noreply@blogger.com (Bart) — Tue, 13 Mar 2007 00:37:00 +0000

For all of us that have had to suffer with the "latest" technology from Corporate...here are excellent examples of alternate applications. [Disclaimer: I do NOT recommend any of the activities demonstrated unless for entertainment purposes only.]

NEVER GET LOST AGAIN: Without GPS

noreply@blogger.com (Bart) — Tue, 13 Mar 2007 00:19:00 +0000

You probably didn't know it, but you can get FREE interactive maps from Google on most cell phones. You can even get real-time traffic and find local businesses. If your phone has a web browser (which most current phones do) it's a snap. NEVER GET LOST AGAIN and find sushi whenever you need it.

Learn more about Google Maps for Mobile here...

Get those BIG FILES through

noreply@blogger.com (Bart) — Tue, 13 Mar 2007 00:05:00 +0000

Don’t you hate it when you have to send a customer a 12 megabyte file? You know it’s going to get bounced by their email system that’s still living in the 80’s. So, you have to go back in time and figure out how to burn a CD that you have to snail mail to them. There is a simple (and FREE) answer!

Try one of the many online services that plays middleman for your file transfer. You upload the file of your choice (as much as 2 GIGS!) and enter the email of the recipient. The recipient gets an email with a link that allows them to download the file with a normal web browser.

My favorite is YouSendIt. [http://www.yousendit.com/] There is no software to download on either end. Everything happens through a browser. The free version includes ads, but who cares? Your stuff gets through.

You can also try one of these or just google, "share large files." There are many out there!
http://dropload.com/
http://www.sendthisfile.com/

Tips from the MBA Rose Bowl

noreply@blogger.com (Bart) — Mon, 12 Mar 2007 23:37:00 +0000

I recently served as a judge at the Rose Bowl of MBA case competitions; the Pac-10/Big-10 MBA Business Case Competition. Each university sends their best team of MBA students to challenge the teams of the competing universities in a business case analysis and presentation. I had a fantastic time, but also recognized three important lessons for students and “seasoned” business people.

1. The obvious problem is rarely the real problem.

In the business case, the company was obviously burdened by massive debt as a result of numerous acquisitions. Every team spent at least 90% of their time articulating strategies to reduce the debt load.

Unfortunately, in the real world, there was nothing that could be done about it. The acquisitions were recent and to try to sell them would certainly require a fire sale and inevitably lead to the parent company’s stock tanking (not to mention the warrants that would likely be violated). More amazing was that most teams then recommended that the funds from divesting certain businesses be used to acquire “better” takeover targets. Huh!? We blew it the first time, so let’s do it again!?!

I am not trying to bash the MBA students here, but rather demonstrate a problem I see all the time (even among seasoned leaders). In a frantic attempt to address the obvious problem, no one recognized the REAL problem: Management of the company in the case had become dependent on buying growth through acquisitions and had lost their ability to grow their core business! This is an all too familiar recipe, particularly in the Supermarket industry. Sales are slow….the solution…build more stores!! Obviously, this is sometimes the correct decision, for example when new suburbs emerge, or when a store is simply out of date. But, all too often, retailers build stores to mask their own inability to grow sales at the locations they already have. Acquisitions are even trickier. If you can’t grow a business you already own, how in the world do you expect to fix the business someone else is trying to get rid of?
[Are you listening GM? Don’t buy Chrysler!]

The lesson: If a problem seems obvious, you’re probably not looking at the real problem. Take the time to understand why the obvious problem emerged in the first place and focus on resolving that challenge.

2. Product positioning matters!

More than half of the teams presented a plan that included increasing pricing on a value brand to increase revenue (only one team calculated the inevitable decline in volume that would result). Unfortunately, none of the teams recognized that this would create THREE premium brands in the category.

I’ve got nothing against premium products, but what makes anyone think they can simply change consumer perceptions of a value brand by raising the price. Even if the product is EXACTLY the same, that doesn’t mean it will be perceived that way. Just look at generic drugs; they are chemically identical, but all of that advertising Tylenol does still convinces consumers that it is somehow better. Quality is perceived, and a brand that invests in shaping that perception will always have an advantage.

And what’s wrong with being a value brand? Great products that cost a bit less than the premium offering (i.e. value brands) are always appealing, if they in fact offer a value. What do you think has driven private label for the past twenty years. It wasn’t those snappy white boxes they started in. The key to success is to clearly position your brand where there is a real need for consumers, and in a manner in which you can deliver with excellence.

The lesson: Any clear product positioning can work. The more your product strategy sounds like someone else’s, the less likely it will succeed.

3. Always take the high-road, but bring binoculars so you can see the facts.

I firmly believe that integrity is everything, and that one should stand firm in defending high ethical standards. During the judges’ deliberations, several of us noticed that one team had used material (from the Internet) that was outside the timeframe of the case. This was prohibited, and I felt it was unethical. I immediately insisted that we must disqualify the team if our assessment was accurate. Unfortunately, the team in question was the clear winner and it was unclear that the prohibited information materially impacted our evaluation. To me, this was irrelevant. The team had broken the rules and, no matter how difficult it may be for the judges, we must agree on an alternate winner. I made my case emphatically and the other judges agreed.

BUT, fortunately for me, experience has taught me to always check the facts, especially in cases of ethics. I requested a copy of the EXACT documents and instructions that each team had received to verify what they had been told. To everyone’s surprise, the instructions the teams had received were different than those given to the judges. Their rules did NOT exclude material after the case dates. So, the accused team had NOT broken any rules and the judges unanimously voted them the winners.

What I had learned was that fighting for high ethical standards rarely makes one popular. I had been surprised by the willingness of some to “excuse away” behavior because of superior performance. But, I was also surprised by how those same people supported my position after I shared my rationale. Ethics may be grounded in values, but it also requires rational interpretation. Just because someone doesn’t evaluate an ethical issue in the same way as you initially, doesn’t mean they don’t share your high ethical standards. Repositioning the issue often casts it in a different light.

The experience also revalidated the importance of getting all of the facts. The competition was delayed by an hour (a very tense hour), but the effort to make a fully informed decision ensured the appropriate judgment. As importantly, the issue was handled discretely and no one’s integrity was called into question inappropriately.

The lesson: Stand strong and fight for high ethical standards. You will be challenged (particularly if the offender is a top performer), but help others understand the basis of your concern. And ALWAYS check the facts. Assumptions are often wrong.

By the way, USC won this Rose Bowl too.

Loyalty can be bought for less than you think

noreply@blogger.com (Bart) — Mon, 12 Mar 2007 22:18:00 +0000

I was feeling guilty the other day about all of the people that have done nice things for me, whom I have forgotten to thank. So, after my meeting, I walked into a Hallmark store. I’ve never expected to have a life-changing loyalty event.

At first, I was unimpressed. While the place was stocked to the ceiling with cards, it was also predictably overrun with Valentine’s Day merchandise. But, this story isn’t about variety vs. duplication, so I digress. After picking out a stack of cards, I proceeded to checkout expecting my pile of appreciation to cost at least $10. The owner asked if I had a “gold sucker card” or something like that. Realizing this was yet another scam to get me to “pay to save” or a grab for my personal data, I quickly told her that I had no interest in her club. I mentally accepted that my $10 of cards were now likely to cost $12. It cost $35. A bit in shock, I stammered, “Well, I guess I have a lot to be thankful for!”

But this is where the real story begins. The shopkeeper looked up, smiled brightly, and said, since you purchased more than $30 today, you can have one of those lovely Valentine’s day coffee cups behind you for free. Incredulous, I turned around and did indeed see a display of lovely “love mugs" with a prominent sign describing the promotion. And then, my natural cynicism was vindicated; I noted the bold starburst on the sign that read, “a special gift for our gold sucker members” (or something like that anyway). Alas, it was clear…this was another attempt to get me to join Hallmark’s evil cult of chronic card givers. I resolved myself to resist the allure of the free love mug and maintain my independence. I told the smiling gray haired lady behind the counter, “but I told you I don’t have a Gold Sucker card.”

And that’s when the loyalty happened…

She said, “Oh sir, I insist. I appreciate your business and think you deserve it. I also gave you the club discount. Please take the mug with my compliments.” My jaw dropped. And suddenly, what had previously had been a chintzy chotchke, became an objet d'art. I leapt for the mug and said, “Thank you. Thank you. I’ll buy all of my cards here.” And I meant it.

Now look, the last thing I need is another novelty coffee cup. But at that moment, I felt like I had won the lottery. I was a valued customer! I had a gaudy novelty mug to prove it! And take note Walgreen’s, Kroger, Safeway, and Wal-Mart…I will be buying all of my cards there from now on. Is that a big threat to these behemoths’ business? Of course not. But, imagine how much loyalty any retailer could develop is they applied the same philosophy?

A fine Category Manager I know, once said, “Why don’t we give our customers a pie once in a while? We’re probably going to throw half of them away anyway, and at least then we could make a few shoppers feel special.” [I’m paraphrasing of course. Category Managers are always more eloquent that this.]

HE WAS RIGHT! Why don’t retailers do that? Do I want a pie? No! But I didn’t want a novelty mug either! I want what most shoppers want…I want to be appreciated! And there is no better way to show someone you value them than with a smile, a thank you, and the occasional token of your sincerity.

So, retailers,…use your cards, analyze the data, send coupons, and do all the other wonderful things you do with your loyalty programs. But, don’t forget your shoppers are people, and a piece of pie might get you a lot more loyalty than that piece of plastic you call a loyalty card.

Are you a dot or a dash

noreply@blogger.com (Bart) — Wed, 17 Jan 2007 00:34:00 +0000

Today, I was struck by the significance of how one lists his/her phone number. I have the rare fortune to work with "traditional" businesses (consumer goods/retail) and "new economy" firms (i.e. Internet/software/people with no money but a great dream). As a result, I have noticed a trend that is spectacular in its psychological significance while completely insignificant in any other context. I call it "Morse's Choice" in honor of Morse code, which uses only dots and dashes to communicate a message (and which is analogous to all binary forms of communication including all software).

What is interesting is that among e-people (anything related to bits and bites), employees of ad agencies, and designers, the long adopted "-" between a phone number's digits [555-555-5555] has been unceremoniously displaced by the period "." [555.555.5555] Really! Go to just about any design firm's website on the planet and note that their contact information has a profusion of dots.

Why do I care? I'm not sure. But, it's fascinating that what probably started as one Internet company's plaintive plea to be different has slowly been adopted by the "creative elite." [Just for the record, when I founded my first Internet company, CMplan.net, not only did I use a period in our contact information, I included another in the name.] So, what's the underlying message? Being different, particularly in the most mundane ways, can create interest, allure, and even envy. We all have in our nature a visceral response when something taken for granted is suddenly changed....

"What's with that?....Why did they do that?...It was obviously intentional!....So, is that better?!? Am I missing something?" At that moment, chic is born.

I recently read an article in the WSJ about the popularity of handbags made of transparent plastic. If that is not the best example of the ability of this phenomenon to suspend better judgement, I don't know what is. I can't imagine my [male] wallet being revealed to all, let alone the content of a lady's purse (having rummaged through my wife's on occasion in search of the car keys). I assure you, no woman would choose to "edit" her handbag's contents for the world to view, unless her insecurity about missing "what's in" had not invaded her psychy.

Change makes us notice. If we don't understand it, but have no basis for disputing it, we usually assume that those that made the change know something we don't. Therefore, they must be smarter and the change is something (someone) to which we should aspire.

In the end, we are not particularly complex creatures. We all want to matter and we all want to be different...but, not too different. Perhaps substituting a dot for a line is the perfect solution. Tell me what you think at 602.952-8181.

TECH TIP: Sync files easily!

noreply@blogger.com (Bart) — Fri, 12 Jan 2007 22:07:00 +0000

Ever been caught with your pants down (metaphorically speaking) when you discovered that the file you urgently needed was is still on your other computer!? If you have files in more than one location you have got to get Save-N-Sync. I have been happily using this inexpensive utility for two years to keep the files I need synced up across various machines. I even use it to make backup copies of important directories on flash cards. You can learn more on the company's website and even download a free trial. I've tried several utilities of this type and found this one to be very simple to use and intuitive.

Make meetings fun again!

noreply@blogger.com (Bart) — Fri, 12 Jan 2007 21:56:00 +0000

If you hate meetings (and who doesn't?) you'll love this. While I can't verify its source, this sardonic meeting tip was titled "Kroger Team Conf. Call". I am sure you will find it all to familiar regardless of the company with which you work.
----------------------
Subject: FW: Kroger Team Conf. Call

Do you keep falling asleep in meetings and seminars?
What about those long and boring conference calls?
Here's a way to change all that.

1. Before (or during) your next meeting, seminar, or conference call, prepare
yourself by drawing a square. (I find that 5" x 5" is a good size.)

2. Divide the square into columns - five across and five down. That will give
you 25 one-inch blocks.

3. Write one of the following words/phrases in each block:
* synergy
* strategic fit
* core competencies
* best practice
* bottom line
* revisit
* expeditious
* to tell you the truth (or "the truth is")
* 24/7
* out of the loop
* benchmark
* value-added
* proactive
* win-win
* think outside the box
* fast track
* result-driven
* knowledge based
* at the end of the day
* touch base
* mindset
* client focused
* paradigm
* game plan
* leverage

4. Check off the appropriate block when you hear one of those words/phrases.

5. When you get five blocks horizontally, vertically, or diagonally, stand up
and shout "BULLSHIT!"

Testimonials from satisfied "Bullshit Bingo" players:

"I had been in the meeting for only five minutes when I won."
- Adam, Atlanta

"My attention span at meetings has improved dramatically."
- David, Florida

"What a gas! Meetings will never be the same for me after my first win."
- Dan, New York City

"The atmosphere was tense in the last process meeting as 14 of us
waited for the fifth box."
- Ben, Denver

"The speaker was stunned as eight of us screamed 'BULLSHIT!' for the
third time in two hours."
- Paul, Cleveland

"When I won and yelled "BULLSHIT!" the woman sleeping next to me slid
off her chair!"
- Joseph, Los Angeles

The Kodak moment Kodak needs

noreply@blogger.com (Bart) — Fri, 12 Jan 2007 21:47:00 +0000

Kodak has arguably lost its way in recent years and has been decimated by the rise of digital imaging. But this self-deprecating video lays out a hilarious vision of their salvation. The video was originally created for internal use, but was (intentionally?) leaked and has become a viral smash. It’s funny and a great example of the introspective honesty a lot of companies need.

7 fixes for CM in 07

noreply@blogger.com (Bart) — Fri, 12 Jan 2007 20:56:00 +0000

After nearly 2 decades of evolution, Category Management has largely failed to live up to the grandiose expectations set for it. Here are my 7 prescriptions for 2007 that can bring a new level of results to Category Management.

Talk to your consumers.
I have probably participated in thousands of Category Business planning sessions across virtually every category, and in only a handful of plans has anyone bothered to actually talk with consumers. Almost every business plan incorporates consumer panel data and manufacturer research, but these sources rarely tell us WHY consumers are buying what they buy. Consumers want to talk and its amazing how seldom we give them the opportunity. EVERY Category Business Plan should begin with a day in stores talking with category shoppers. Will this data be statistically significant? No. Might the perspectives gained bias an otherwise purely data-based analysis? Yes, and that’s exactly the point. I have witnessed dozens of erroneous assumptions drawn from data that would have been immediately questioned had the team talked with real consumers. We’ve all been brainwashed by our companies and our experiences, so we need a little reality check from the people that buy our products. The best way to get that fresh perspective is…[Warning: sales pitch coming]…by using CM Solutions’ in-store research services. We’ll talk to your customers and help you understand what’s really driving category behavior. And we can do it in a statistically significant way. But, even if you don’t want this kind of powerful insight, don’t miss the opportunity to just go into stores and talk. You’ll learn a lot and the shoppers will be thrilled to have their voices heard.
Let the Category Managers actually manage the category.
I am very alarmed by the trend among many retailers to remove pricing and other tactical decisions from the control of their Category Managers. New price/promotion optimization technologies from companies like DemandTec and KhiMetrics are powerful tools, but to use them outside the category planning process (and away from the CM’s desk) is just plain nuts. It is common for a Category Manager to sub-optimize pricing in one segment or brand to achieve a broader objective. Such decisions will never make sense to a software algorithm. I’m not suggesting that Category Managers should autocratically make all decisions for the category, but they must have the power to implement the tactics they have identified as crucial to achieving their objectives. Otherwise, why bother giving them the objectives in the first place.

Stop worrying about fair share and be different.
Category Management was never about copying the tactics of others in the market, but all too often, that’s what it has become. The overdependence on “fair-share” and averages has produced ineffective homogenous strategies. Just because Kroger or Safeway promotes Pepsi 12 packs 24 times a year doesn’t mean that’s the right answer. Looking at fair share is fine, but only when it is used as a tool to be different. If you have your fair share in every category, guess what, you’re average (and you’re not going to last in the long run). Power lies in deciding where to have MORE than your fair share and where to have LESS (and you must have both). Consider one of my favorite aphorisms; “Different isn’t always better, but better is always different.”

Spend 20% of your time planning and 80% executing and measuring.
I’ll begin with some Category Management blasphemy…most of the time you spend analyzing a category is a waste. That doesn’t mean you shouldn’t analyze, but you should be acutely aware that no historical analysis can be perfectly predictable. The power of CM lies not in its predictive power, but rather in its production of a plan that can be used to evaluate performance on an ongoing basis. Even the best Category Business Plans are nothing more than a best guess of what might happen. They can only create value when the planned activities are executed and measured versus expectations. Consequently, the most effective Category Management processes emphasize implementation and review, not assessment. Assess quickly, create a good plan, and get on with implementing and reviewing. That’s where you make money.

Look outside, not just inside.
Retailers are addicted to shopper card data. Why? I think it’s because it’s readily available, it’s their’s, and they understand it. It is valuable, but for goodness sake, most of a retailer’s shoppers buy from other retailers too. Knowing that the top 10% of your shoppers contribute most of your profit is WORTHLESS! It’s a mathematical truism. What’s even more frustrating is the notion that, “We need to move more of our shoppers into the “top” category.” You can’t! That group is usually defined as the top n%. You can raise the average spend among those in the top 10%, but you can’t have more than 10%. OY! What retailers really want is for more of the people that don’t spend most of their money with them to begin doing so. By definition, that means those folks are spending their money OUTSIDE the retailer. So, at best, internal data is marginally helpful in figuring out what to do. Consumers have an ever broadening set of retail options. You’re fighting for their food budget which is increasingly split across numerous outlets. Trying to convert your shoppers that buy two yogurts a year into ones that buy 20 yogurts a month, like your “tops”, may be missing the real problem. A lot of your shoppers are probably buying their yogurt at Trader Joe’s or Costco.

Think about the type of trip, not just the category.
People go to grocery stores to buy groceries, not just peanut butter. But, when creating a Category Business Plan for peanut butter it’s all too easy to forget that this chunk of products is only a small part of why shoppers come to the retailer (or don’t). If we discover that we sell PB to only 15% of consumers in the market we panic and begin to plan more promotions. But, if the retailer has only 12% market share that may not be too bad. More importantly, can we really grow the peanut butter category effectively by trying to attract new shoppers to the retailer? I’d be more concerned about understanding why we weren’t getting more “staple” trips that include such items. Maybe the broader promotional strategy of running ridiculously cheap soda and chips is just bringing in shoppers for a “cherry-picking” trip on their way to their preferred “full-basket” store. If you don’t fully understand the types of trips and shoppers the retailer is getting across categories, you can never completely understand what’s going on in any individual category.

Train your people
When was the last time you were trained in Category Management, or data analysis, or sales? You probably don’t remember. For most people it was when they first took a position related to CM. They were sent to a week long seminar and learned how to “do Category Management”. Unfortunately, those seminars stink. They have NOTHING to do with reality. [Warning: slipping into selling mode again] CM Solutions provides numerous seminars in Category Planning, Data Analysis, Assortment, Sales, and Marketing Strategy that can immediately boost your team’s capabilities and drive sales and profits. And don’t underestimate the value of software classes (particularly Excel, Work, PowerPoint and Outlook). Most of us spend a lot of time using these applications and stronger skills can dramatically increase productivity. Whether you exploit our courses or someone else’s, it’s probably time to freshen up the skills of your team. You won’t regret it.

There you have it; the 7 things to transform CM in ’07. Give us a call and we can help you leverage them to transform Category Management into a money making machine for you and your trading partners.

ASSORTMENT TIP: Get lean in '07

noreply@blogger.com (Bart) — Thu, 11 Jan 2007 00:51:00 +0000

The winter holidays have come and gone, but the effects of our indulgences linger on. By the end of the year most of our categories have become as bloated with items as our waistlines. Every study done in the past 10 years has shown that a lean assortment increases sales, reduces consumer confusion, and improves profitability. Isn't it time you got your category and shape. Doing an efficient assortment review may be as intimidating as committing to a workout regimen, but it doesn't need to be. Here are three simple steps and a practical template that will get you to a lean assortment:

Review segment performance and set targets for the number of items in each segment: The primary reason efficient assortment analyses take so long is that people start with the item level data. Every item selected to be discontinued feels like lost sales, making every decision arduous. By setting an aggressive target for the total number of items to be included in the category, as well as specific targets by segment, a framework can be established that makes decisions easier and faster. Additionally, this approach more effectively eliminates duplication while protecting specialized niche products. For example, if you’ve determined that the category should have about 5 specialty items, you won’t feel so bad about keeping them and you’ll be more likely to pick the right ones.

How do you know where to set your targets? I like to start with the objective of cutting 20% of the items in the category. Harsh? Yep, but you’re unlikely to stick to that number in the end, so it’s better to start aggressively. So, if you started with a hundred items you should try to get to 80. Next, divvy up those 80 items across segments allocating more for important segments and fewer for secondary segments. If you know of new items that are coming, be sure to count those as well since they'll need space soon enough. (TIP: It usually makes sense to set targets by sub-segment, for example, “premium adult” instead of the broader “premium” segment. This will break your review into manageable chunks instead of huge groups of items they're hard to differentiate.) Then, and only then, start reviewing item performance to identify which items have to go.

Review items in one file on the computer (preferably using our best-in-class template):
No matter what report you use, never make assortment decisions working off of paper. Printing out a hard copy of a report necessitates a fixed sorting. There is simply no way to sort the data effectively to answer every question that you will have in your analysis. The best approach is to bring all the metrics you will need together in a single file and review it with all the key decision-makers in the same room, looking at the same data using a projector. Everyone will literally be on the same page and the data can be dynamically resorted to answer any questions that come up. Additionally, items can be marked for discontinuation before a final decision has been made, allowing the group to quickly see if the item count targets are being met.

So what metrics are most important? That depends, but I'm pretty partial to dollar sales. It's not the only factor to consider, but it's hard to disagree with cold hard cash. My recommendation is to build a robust report that includes numerous metrics, sorted by segment, in descending order of sales. That way, you can quickly see what is selling best and you have the context of the additional measures. I also like to include a notation of which accounts in a market carry a given item. This helps quickly identify if an item is true variety or simply duplication of a similar item at another account.

A sample of the report I have described is available here. You may prefer different measures, but I have found this to be the most effective layout for assortment decisions on the planet. It may take a little extra time to create an advance, but I guarantee the time invested will be saved many times over in the analysis process.

Monitor item counts quarterly to keep the fat off: Efficient assortment really is a lot like dieting; it's not just about getting lean but also staying lean. Every category needs new items just like we all need that occasional piece of chocolate cake. The key to maintaining a lean assortment is to stay true to your segment item targets. Once a quarter, simply review each segment’s share of sales and share of items versus the targets you originally set. You'll never match your targets perfectly, and it's okay to put on a few extra items, but you need to ensure that your bottom is not getting too big. (TIP: If you're really smart, you'll insist that new items build sales in excess of the segment average when they were added. If they don't, cut them since they're pulling your segment down.)

If you just take a few hours each quarter to monitor your assortment, you won't need to go on a painful crash diet again. If you'd like to learn more about how CM solutions can help grow your business with efficient assortment tools and training, give us a call. I'm off to the gym.

The iPhone: Will it change your brand?

noreply@blogger.com (Bart) — Thu, 11 Jan 2007 00:22:00 +0000

Yesterday, to much acclaim, Steve Jobs announced Apple's latest consumer electronics innovation, the iPhone. Its features are incredible. It’s a phone, personal digital assistant, email client, web browser, music/movie player, and camera. But, what’s really significant is the example it sets for every consumer product on the market.

There are already numerous consumer electronic devices that offer the same features as the iPhone. I own one, a Palm Treo. The problem has been that most products offer features, but few offer solutions. I want all of these nifty wiz-bang capabilities, but only if they’re easy to use!

The value of any solution (or brand) is factored by the effort required to get that value. The perfect example of this was demonstrated in a frozen food study we conducted. The overwhelming majority of consumers said they preferred items prepared in the oven, but they usually prepared them in the microwave. They were willing to give up product performance for the value of simplicity. When you can achieve both, you have a mega-hit. The iPod delivers superior performance AND is fantastically easy to use throughout the entire usage experience. That’s why it has forever changed the music industry. The iPhone may do the same in the wireless industry according to many. (See Larry Dignan's blog on ZDnet for more on that.)

The bigger question is what is your product’s solution and how can you make the total usage experience better. If you don’t think this opportunity exists with your products, just look at the innovations on supermarket shelves. From re-sealable plastic coffee “cans” with handles to yogurt in tubes, the incremental value resided in making the consumer’s process of using the product simpler.

Have you thought about how your "solution" makes your customers' lives easier from shelf to trash can? Can you make it easier to carry, prepare, pore, or store? Are you focused on the features of your products or the solutions they provide? Give CM Solutions a call and we’ll help you discover the complete value of your brand.

Easier solutions are worth more than hard ones. That’s why Apple will probably get lots of consumers like me that are willing to shell out big-bucks for the iPhone. Their solution is worth it even if the components aren’t.

HISPANIC MKTG TIP: Family matters

noreply@blogger.com (Bart) — Thu, 16 Nov 2006 21:46:00 +0000

According to Carl Kravetz, Chairman of the Association of Hispanic Advertising Agencies, marketers may habla espanol, but they don't get Hispanic consumers. In a speech on November 13, he discussed the findings of a market study, "What Makes a Latino, Latino?"

One contention in the report is extremely consistent with our research at CM Solutions:

Mr. Kravetz says, "Interpersonal orientation is the way we live our relationships with other people, and is ... radically different from non-Latinos," he said. For instance, individualism is important to Anglos, whereas Latinos have a collectivist culture that favors cooperation, and values family needs over those of the individual.

In every Hispanic Insights study we have conducted, one of the most frequent comments from Hispanic shoppers has been, "I buy it because my family likes it." Of course non-Hispanics say this as well, but far more often the comment is, "because I like it."

Mr. Kravetz's conclusion is that this means marketers should focus on understanding the Latino family as a unit, including group decision making. I absolutely agree! The trick is understanding how to do this. With our experience in talking directly to thousands of Hispanic consumers we can help you discover your key influencers. Give me a call and I'll be happy to discuss how we can help your brand connect with all of your consumers, including Latinos.

AdAge report on Mr. Kravetz speech
Transcript of another Kravetz speech on the same subject

Looks like AdAge agrees with me

noreply@blogger.com (Bart) — Thu, 16 Nov 2006 21:18:00 +0000

A brief article by Marc Graser of AdAge draws much the same conclusion as I did with respect to the Nielsen study on product placement.

Nielsen says product placement boosts brand recognition 20% (Maybe)

noreply@blogger.com (Bart) — Thu, 16 Nov 2006 17:04:00 +0000

Nielsen Media Research has proudly released a new study that claims that having a product placement in tandem with a traditional ad on TV boosts brand recognition by 20%.

My response: So what.

The study found that brand recognition increased from 47% to 58% when a commercial was accompanied by a product placement in the same show. Duh! They saw it twice and, as a result, a slightly larger proportion remembered it. The bigger question in my mind is did that additional investment produce an increase in purchase intent? Unfortunately, the answer to this was NO. If you dig deeper in the research, here's what they found:

"The addition of a product placement to a commercial spot for the same brand does not appear to have an edge over a standalone commercial in terms of motivating viewers to purchase that brand. Whether the brand was presented as a product placement, commercial or both, a little more than one third of all viewers expressed high interest in the brands they were able to recognize."

There might be some silver lining in the finding that, "Product placements appear to be at least as effective as a commercial spot in improving viewers' general attitude toward a brand. Nearly 60% of all viewers felt more positive about the brands they were able to recognize in a placement." But, note that this only applies to brands consumers' recognized (i.e. were already familiar with).

Most notabley, the study said, " Substantial variations in brand awareness, attitude and purchase interest were found to be impacted by the level of familiarity a viewer had with the brand, the genre of the program, a viewer's loyalty to that program, the exact nature of the placement, etc." In other words, if I already knew your brand, liked your brand, planned on buying your brand, and you put it in a positive context in a show I like, I liked the placement. Again, DUH!

Look, I am not against product placements. It’s just that this story is another example of a headline leading marketers down the wrong path. If you don’t understand the implications of the entire study, you’re likely to start over-investing in placements when they may not contribute to your ultimate objectives (which you should be clear on before starting any marketing effort, by the way). Placements can be very powerful, like Wonder bread in Will Ferrell’s film Talladega Nights (which they didn’t pay for). But, it is not just about putting the product in front of consumers again. The key is to associate the brand with a likeable character or emotion.

My opinion: put your quality product in the hand of my favorite character, in my favorite show, and show her enjoying its benefits, and you MIGHT change my perception of your brand. Otherwise, save your money and stick with the commercial.

[I wonder what Budweiser would pay to displace Duff in Homer Simpson's fridge? Ohhhhhh...BEEEER.]

Does your brand have a champion's smile?

noreply@blogger.com (Bart) — Thu, 16 Nov 2006 16:25:00 +0000

I never thought I’d say this, but I got hooked on the reality show “Dancing with the Stars”. I came home from a date with my wife one night and our babysitter was watching it, and I was captivated by the skills that amateurs had developed. I didn’t watch the series religiously, but I did see enough to know who the really talented people were.

To my surprise, Emmitt Smith of football fame was crowned this season’s champion. Was he the best? Not even close. I’m no dancer, but it was very clear to me that his competitor, Mario Lopez, executed much more difficult moves with infinitely more finesse.

The moral of the story: NEVER UNDERESTIMATE THE POWER OF CHARISMA. There is no doubt that Emmitt Smith had the most infectious smile and engaging personality on the show. You couldn’t help but want to see him succeed. He performed extremely well, but was not the best. He did however, have the most appealing product.

So what does this have to do with marketing? EVERYTHING. Having the best product is not a sure path to victory. As in dancing, it’s just as much about charisma. Does your brand have a winning image? Does your marketing make your brand likeable? Is your packaging captivating, like Emmitt’s perfect smile?

Even if your success has been driven by a performance edge, don’t underestimate the power of creating an appealing LOOKING product. The best example of this is in the PC graphics-card business. Ten years ago, these powerful video processing cards were unadorned chucks of silicon and metal shipped in plain brown cardboard. After all, they were being sold to hard-core gamers who were presumably focused on performance; and they were going inside a computer anyway. Much to the surprise of the industry, when they started putting exciting images and colors on the card and using professionally designed packaging, sales skyrocketed. Why? Image, not performance! Now, half of the battle in selling these cards is figuring out whether to cover the package with scantily clad nymphs or blood-oozing demons. [Gamers seem to like naked things or killing things.]

So take an honest look at your brands and positioning. Is their success relying exclusively on performance or do they have that winning smile to become champions.