The Chinese invasion is on

Melbourne Herald Sun, Friday June 8, 2012

The massed forces of the Chinese proletariat are swarming across the sea, onto the mainland of Australia in serried ranks and with determination on their faces. Yes the Chinese invasion is here - and we've just committed another $250 million to help it along.

As our nation is getting older it's getting smarter and what was regarded as a peril a century ago is now seen as some of the best business we have ever had. Here in Business Daily every page holds some story about resources sold for billions, new ventures, new technologies tied to our links with China and the rest of prospering eastern Asia.

This week's focus has been on tourism, with the launch of Australia's new global advertising campaign. Not in New York or London but in Shanghai. Added to the drive for the dollar and euro is the yen for the yuan.

The current campaign does not swear at the visitors. How would "bloody hell" translate into Mandarin anyway? And there are no jolly Hogans putting shrimps on the barbie. But there is a child feeding a joey at the beach. Combining kangaroos and surf was quite a stroke, I thought. I hope visitors don't expect to see pods of them.

I always sympathise with the poor creative directors. They have to make sure each state gets a few seconds on screen or else there is political tub thumping. Already the Victorians are rumbling that their three seconds of Crown's flame-throwing do not equate to the more leisurely flight over Sydney harbour.

Then there's Katherine Gorge, rain forests, Uluru, wombats, Whitsundays, over a soulful background song with a viola that sounds almost Chinese. Oh what a tapestry to weave and make look like you meant it.

The slogan holding the bundle together is the two-years-old tag, "There's nothing like Australia". It ticks the right boxes, stressing our uniqueness and mentioning the product, though you couldn't call it memorable. But if you ever write a campaign to be translated into 17 different languages, as this one is, you learn to keep it simple.

A lot of emphasis has been put on social media, even bigger in China than here. Tourism Minister Martin Ferguson and MD Andrew McEnvoy proudly showed the Chinese media their interactive tablet app that becomes a colourful photographic brochure.

The high Australian dollar has made us an expensive holiday destination, so the campaign is very much targeted at the upper middle classes (forgive me, Chairman Mao, for using such a term) that can afford luxury. But amongst a billion people there are lots of them.

Last year passengers through Tullamarine from China increased by 32 per cent. Indonesia suddenly discovered its great south land, with their numbers jumping 86 per cent. Japan, South Korea and the Philippines also mushroomed.

Walking the city, I see fleets of buses pulling up at rather mysterious shops, around Collins and Bourke. A couple of times I've ventured in to discover big department stores totally geared to the tourist market.

Swarms of tourists rush around buying koala dolls and boxes of macadamias that you know you could get much cheaper at the Queen Vic market. But this is tourism territory, from toys to opals to snow-globe Opera Houses. I've seen variations on these in every tourist centre in the world. So it's good that we come into that category.

And tourism is not just ephemeral. The government is looking for long-term investment from these visitors, with outlines already prepared for some 80 projects - with $42 billion worth either planned or underway already. That's a lot of stuffed koalas.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

The psychology of naked girls and burning books

Melbourne Herald Sun, Friday June 1, 2012

So many of the best advertising campaigns are not just ads. By getting into the psychology of their audience and communicating to their wants and needs, marketers can achieve so much, for so little cost.

Imagine a beautiful near-naked girl writhing with pleasure as she looks at your picture. Or a morning alarm call that drags you out of bed to go running, by threatening you. Or the prospects of burning 200,000 books to make a political point.

They don't sound like billboards and TV commercials, do they? Yet they are some of the most successful ad campaigns over the past year.

Of course your interested is piqued by the beautiful girl wearing just flimsy lace bra and tiny panties, writhing on her bed in pleasure as she thinks about you. Well this is a bit of interactive trickery from Sydney agency Arnold Furnace, promoting Stonemen underwear.

It's an online video, accessed through your computer or mobile phone, that requires you to upload a head shot of yourself (or unsuspecting friend). When it is played, a stunning model goes through her soft-porn motions for a minute, and is finally revealed to be looking at a hunky, muscular magazine centrefold - with your face.

Reebok have created The Promise Keeper. It's a smartphone app that you can set to wake you up on jogging mornings and then tells your friends, through Facebook, how good you've been. If you don't get up it tells them you're a wimp and failed your commitment. Better pull the blanket over your head.

But the best example of a psychological campaign was devised by Leo Burnett, Detroit. Last year the library at Troy, Michigan, needed funds to survive the coming five years. The council proposed an 0.7 per cent levy on rates. When the conservative Tea Party heard this they frothed and massed, condemning "New Taxes", and defeated the measure.

There was a second opportunity to vote on August 2. So a campaign was launched: "Vote to close the library. Book burning party on August 5!" Signs were planted around town and on social media promoting the event - and now it was the pro-library faction that frothed.

The campaign grabbed the national press, the TV and radio, even foreign news broadcasts - all without a cent of media expenditure.

On Facebook, slogans proclaimed, "The Troy Public Library might be short on money but it has books to burn!" Another post showed a barbecue burning some books: "Imagine this times 200,000. How cool is that?" A band was booked for the event.

When the indignation became overwhelming, the secret slipped out: the real campaign slogan was "A vote to close the library is like a vote to burn books." They actually wanted to save the library. And it would only take a 0.7 levy to do it. They had succeeded in turning the conversation around from "No more taxes!" to "Save the books!"

On voting day thousands who wouldn't normally turn out to vote took themselves to the booths. In the end, the Yes vote was a landslide, 342 per cent higher than projected, and the Teas were bagged.

None of these three campaigns cost much more than the price of a handful of prime time ads. Yet they were far more effective than their expensive competitors. They worked because their creators thought through, into the minds of their audience, and triggered their psychology.

Unfortunately these success stories are rare. Not because the ideas aren't out there - but too often, because of a lack of courage to risk a daring stroke.

Maybe I should send an outline of the "Taxes" campaign to the Prime Minister...

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Kangaroo hops the ads

Melbourne Herald Sun, Friday May 25, 2012

A cartoon kangaroo is at the centre of a new American media storm that is going to be just as relevant here. It's the perennial topic of ad skipping. Are you being unfair, and risking your nightly entertainment, by removing the ads?

The topic has surfaced with the recent release of a new heavy-duty digital video recorder called "The Hopper" (hence the kangaroo logo). It will record up to six channels at once, and as it replays, it can automatically cut out the commercials - hop over them.

The television networks don't like this recorder. In fact several have refused to play commercials for the product (rather ironic if you think about it) because of its potential to damage them. The latest, just this past week, was Fox Network in New York.

The reason is obvious. If everyone was able to skip the ads on their nightly programs, the advertisers would close their cheque books and walk out. Network revenue would plummet and they would suffer even greater financial pains than many of them are already feeling.

The simple fact is that if we want varied, entertaining TV stations they have to be paid for, somehow. Currently it's through an invisible tax - the manufacturers' advertising budgets. Oh yes it is a tax - it is collected from every dollar you pass across the shopping counter. Fortunately for our governments, no-one calls it a tax.

The popular alternative to ads is the ABC. But once again you are paying the cost of those invisible commercials. Only here the tax is direct, paid from consolidated revenue so you actually see it. Hence the annual brawl between the network's management trying to get more, against the government trying to balance the budget.

If ad skipping robbed the TV stations of their income, they too would then have to charge us direct - some kind of monthly subscription fees, like the cable stations already do. But even those fees would rise if they lost the subsidies provided by the advertisers.

Again in America, the head of CBS, Les Moonves, used this very point as a warning over the growth of hopper technology. "How does Charlie Ergen," the manufacturer of the technology, "expect I produce CSI without advertisements?" All that blood and gore costs around $6 million an episode to produce.

Time Warner's Glenn Britt agreed: "The dual stream of advertising and subscription fees has been great for content providers and we don't want to destroy one of those revenue streams,"

This argument has been around since the earliest introduction of video recorders. The fast-forward button allows you to "zap" the commercials out of pre-recorded programs, perhaps not as efficiently as a hop but just as effectively.

But what we have learned from that experience is that once we're settled in for the night, the zapping decreases. After all, those three-minute breaks are the ideal length to check the kids' bedrooms or visit the loo.

However, automated hopping is a command you can set and forget. This is what has agitated the networks.

This battle has already been fought, nearly a decade ago. When the TiVo first hit the American market it had commercial-zapping technology as a major selling point. But it was a laborious process involving transfers to your PC and installation of downloaded apps.

A competitor, ReplayTV, had built-in, automatic cutting. They were sued by the TV industry, sending their parent company broke.

Will this be the fate of the hopping kangaroo? Right now there are intense discussions among the normally factious networks about the ways and means to kill this threat to their revenues.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Abra-Shazam! An Instant Millionaire

Melbourne Herald Sun, Friday May 18, 2012

Late today - Friday American time - Facebook will launch into the public market. It will create a feeding frenzy that will make a pirana tank look like high tea at the vicarage.

The issue of 421 million shares is expected to hit $38 each, valuing the company up to $100 billion. Mark Zuckerberg will celebrate his 28th birthday a few days later. He'll retain control of 58 per cent of the voting shares. Two of his boardroom insiders will collect more than a billion and a half apiece. Not bad for a company that started eight years ago.

We're living in a world where - literally - new inventions are appearing every day. The 19th and 20th centuries were gloriously inventive. But now it's not steam engines and aeroplanes that excite our wonder, it's the thousands of little inventions that have taken over every spare corner of our lives.

At the big end are robotics and energy science, but at the small end is the invasion of countless applications for our appliances, televisions and phones - the apps that for a lucky few can spell almost-instant riches.

I was pointed to one a few days ago, called Shazam. Download it free onto your mobile phone, and next time you hear a piece of music you like, press the Shazam icon and it will tell you its name.

Now that sounded far-fetched to me so I tried it. The YouTube demos show it finding music by the likes of Metallica but I wanted to give it something difficult. Going as far as you'll get from Metallica I played Brahms' Second Symphony and pointed the phone at the loudspeaker.

The logo on the phone screen rotated and blinked, then sent a signal to its brain in the cloud. A few seconds later the answer came back. Correct, it even named Herbert von Karajan as conductor. I was seriously impressed.

Now I know a lot of you will think I'm pretty late getting here - after all there are 200 million people Shazaming in 200 countries around the world already (yes it is now a verb. Already). But many of my readers won't know it yet.

Which raises the question - how long can you be a start-up before you are discovered, or you go broke? Shazam, after all, was developed in 2002 and slowly, quietly grew until smartphones took off a few years later. Now it has doubled in membership just in the past year.

Economists love talking about "monetising" - how do you make a quid out of your product, ideally more than you are putting into it. In Shazam's case it was easy. When it finds that elusive song for you, it shows another button on screen. Click through to iTunes to download and buy the track.

Now there is the gold. A few cents commission a time on how many million downloads a day...? They are also expanding the service into TV. You can click a participating commercial and perhaps win a gift or enter a contest. For the advertiser it gives them a measure of real-time responses to their campaign.

We can safely predict that when Shazam raises its initial public offering - soon, they say - it won't go anywhere near as high as Facebook, but it will still make the owners filthy rich. Oh to be that muddy.

Unusually, the company is British - showing that you can create a great app without living in Silicon Valley. It also made them eligible for some British honours.

Just last month it was awarded the Queen’s Award for Enterprise in Innovation. Maybe they can break a record for winning knighthoods.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Get the most out of every customer

Melbourne Herald Sun, Friday May 11, 2011

They call it "the cost to serve" or CTS. According to supply chain consultancy Logistics Bureau the figures are pretty consistent across all industries: 20 per cent of customer orders make negative profit, 10 per cent of the product range makes no contribution, and 12 per cent of customers are totally unprofitable.

Think about your own business - the cost of opening the door every morning, paying staff, rent, overheads, buying product - and you'll probably say the figures are conservative.

So you work hard to drag each customer in. But once you have them, do you get all you should out of them?

The art of good business is maximising your sale. The shopkeeper in the deli knows it, and asks, "something else?" at the end of each purchase. The fast food retailer knows it, when the customer orders a hamburger and is asked "you want fries with that?"

This on-selling is an essential part of the marketing strategy for the likes of McDonalds and KFC. More than a third of fast food and snack sales in these restaurants include a soft drink with them.

When you consider the billions of dollars turned over by these companies, you get an inkling of the amount of money involved. No wonder Coca-Cola has a division totally devoted to McDonalds, complete with its own president. After all, he has to ensure that Coke is bought with the burgers sold in 31,000 outlets in 100 countries.

The other method is up-sizing. Whenever you buy a soft drink at the cinema, you are offered ice cream and popcorn in a bulk buy. Another dollar and you get the super-humungous box that will keep you annoying the neighbours throughout the movie.

But hey, if they have sold you a ticket for $15 and then another $10 worth of nibbles, that's a 66% increase in your value as a customer.

But you don't have to run a restaurant to make good use of on-selling. A smart tailor won't let you out of the shop without pointing out a couple of shirts which will perfectly complement your new suit.

The hairdresser will persuade you that to maintain your expensive new cut and colour you need this salon-quality shampoo and conditioner set. And a travel agent will persuade you that before taking the overseas holiday, the family had better be covered by insurance.

If you consider how difficult and expensive it is winning the customer in the first place, it's so obvious that you should maximise the sale - sometimes even double it - by adding that "something else...?"

But think back to how many purchases you make that miss out on this extra sale. The assistant blankly takes your money, bags the sale, and turns away. Often it is up to you to add, "By the way, do you also sell thingamy jigs?" Sometimes you even have to go to the back of the queue and start all over again.

It all comes down to staff training. It's difficult when the teenage shop assistants have their brains tuned to Saturday night's date, to get their focus back on the job in hand.

You have to make sure they understand their product, the stock, and the mind-set of the customer. The suit buyer isn't looking for a garment but for how he will look when it first goes on.

The patron hasn't come to see a movie but for an entertainment experience. The travellers want to enjoy the holiday, not worry about the unforseen.

When your staff understand the bigger picture, they can maximise that hard-won sale.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Has our creative flourish gone to South America?

Melbourne Herald Sun, Friday May 4th, 2012

The TV commercial starts with a serious voice-over. "Along with summer comes every family's worst nightmare (pause): Dads in briefs!"

The visual is a series of slow-motion shots of pudgy fathers shuffling about their houses in their underpants, much to the disgust of their children, from teenagers to schoolkids, not to mention mums and even the dog.

We're out of season now but the scenes, and the grossed-out responses, will be familiar to any Australian family. As it turns out the brilliant commercial promotes air conditioners.

It's a commercial that would be perfect for Australia. The problem is, says McCann Creative Director John Mescall, that it was made in Argentina.

"The issue for Australian marketers is: that used to be us. The South Americans are not afraid to be unique, and to express their cultural uniqueness through their work. But too much of our work feels like it could’ve come from anywhere in the world."

He sums up a feeling I've had for years now: why don't we create great work here any more? Once, like Olympians, we punched well above our weight in the creative contests of London and New York. These days the Cannes lions have been won by our PR and on-line work, rather than a strong representation of TV commercials.

"The work that we do has changed now," explained Mescall, "from advertising to integrated campaigns." As he sees it, a decade ago, "With a brilliant commercial you could shift the fortunes of a brand," and in turn the work attracted adventurous clients. Now the world is a more cautious place.

Worse, thinks Mescall, our modern generation's constant exposure to the world of TV, mostly American, has given us a global culture. This has been uncovered in research they have carried out which shows "There isn't a popular Australian culture any more".

If you doubt his words, spend a few hours channel surfing through young people's TV shows. The streets, clothes, accents are mostly American and the commercials feature skate boards and baseball caps because these are now the Australian norm. They don't even bother to change the accents on the imported TV commercials much of the time.

Alas to be a boring protectionist, but many of us predicted this consequence when TV advertising quotas were pulled down. Once a high percentage of commercials had to be made in Australia. Today the only local ones tend to be the boring retail one-camera walk-throughs.

However, talent can't be held back forever. Some good stuff does get through. The beer and drinks category still has enough money to make some witty, daring stuff. Like the Canadian Club "Beer Fairies" campaign, where beer drinkers are depicted as fat slothful boors with tattered wings on their backs.

One commercial that won gold at Cannes was really a short film. Made for rock station Channel [V], it's a montage of nightmare pictures worthy of Dante's Inferno, slowly rising up until it becomes a rock 'n' roll heavy metal heaven. Very clever, chase it down on YouTube.

The essence of great Australian ads has always been the strength of wit rather than big budgets. They might have been made before you were born but you'll still be aware of the Holeproof "Some day you're gonna get caught" or "I'm wearing no nickers" campaigns. No expensive sets or locations, just cleverly showing the benefits.

Or more currently McDonald's. where a couple set up a garage sale, anxiously watch till an item is sold for a small sum, and then rush off to buy the day's burger bargain. Simple, witty, award winning. We need more of these.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Grasping for the wrinkly wallet

Melbourne Herald Sun, Friday April 27, 2012

As you look in the mirror every morning you can't help noticing that you are no longer the young sprout you once were. Regardless of age or sex, we can always look back in memory to a time when skin was a little tauter, wrinkles didn't exist, we were filled with the flush of youth.

As our society ages, more of us are searching to cling that little bit longer to youth. And these days there are plenty of cosmetic and pharmaceutical companies happy to help you try.

Some will sell you a pot of anti-wrinkle cream, others offer treatments whose costs make Cleopatra's baths of asses-milk look cheap. Which of course reminds us that the quest for beauty treatments is nothing new. However it has become a lot more scientific.

In every pharmacy now there are displays of "anti-wrinkle treatments"; plastic surgeons have become high street shop fronts; botox bars jostle the Boost bars.

Soon to follow will be a product called LaViv. It takes cells called fibroblasts from behind the patient's ear. These are cultured for three months to grow tens of millions of new cells, which are re-injected into the patient through three sessions at five-week intervals.

The treatment is said to be particularly effective against "laughter lines" and less plastic than botox. However, treatment can cost up to $3000, and is quoted to last six months. Then add the cost of a trip to LA - as yet it is not available in Australia.

A few years ago there was Isolagen, a treatment where patients were injected with collagen-producing cells. This was hailed for a time as the answer to the wrinkle problem - but then America's Food and Drugs Administration pushed it off the market because there was no clinical evidence that it was safe.

Many of the new products use scientific discoveries that combine chemicals with the traditional lotions and creams, to the degree that they are attracting a new name: "cosmeceuticals".

This in turn is causing some confusion on the administrative side. In recent years the Therapeutic Goods Administration has classified cosmetics as industrial chemicals and the government has passed their management over to the National Industrial Chemicals Notification Assessment Scheme (NICNAS).

An example that is currently causing some controversy is the use of extremely small particles which have attracted the marketing name of "nanotechnology".

The problem is these chemicals are so small that they pass right through the body's normal barriers and no-one is sure what the long term effects may be. In America the drug administration is researching metal oxides used in cosmetics in case they become toxic when exposed to sunlight.

However nothing is dampening Australians' willingness to spend on beauty. IBISWorld estimates that we will spend $7 billion on beauty this year, $313 a person. Which is nearly 20% up on last year.

This also includes more regular facials, hair removals, cosmetic procedures, time at the hairdresser and the gym.

So definitely the generation that still rocks on stage as the Rolling Stones or next week's visit by John Paul Young, is refusing to accept that wrinkles and sags are a necessary price for being alive.

Pam Abeling, former Australian managing director of beauty consultants Always In Style sums it up: "It's been years since I've used a cream that's not "anti-ageing". I'm never sure whether or not something is working. But at the same time I don't want to stop using it in case it does."

She sums up the power of the anti-ageing message: "It gets every woman where she lives."

The men aren't far behind.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

The One Direction Is Riches

Melbourne Herald Sun, Friday April 20, 2012

Here's how marketing can make you millions in a year - if you have the right ingredients.

You'd have to be locked in a padded cell to not be aware of this week's visit by One Direction. If you have teenage daughters you have probably been driving screaming kids around town. One Direction is the youthful quintet that has taken the pop world by storm - and is as artificial as a plastic chook.

Boy bands have been stirring hormones since the Osmonds and Jackson 5, but the geography-hysteria-time equation of this group marks a new communication record.

It starts with the marketing genius. Simon Cowell is known as the nasty judge, in Britain and America, on X Factor, American Idol, Britain's Got Talent and other contests. He sits at the pinnacle where he can watch all the new talent and, like some god, pick the ones he likes.

So he scrutinised the countless contestants going through the talent mill, ticking off five boys for voice, energy, and cuteness. In reverse order, come to think of it. He then contracted them to Syco, the record label he partners with Sony. He brought in big-time songwriters like American Idol 2002 winner Kelly Clarkson and Savan Kotecha - who works as A&R for Syco. Beginning to see the pattern?

Having created the product, the next job was starting the fire. They hired London ad agency Archibald Ingall Stretton, who used social sites to create a "transmedia adventure" that would excite fans.

They invented a super-dedicated fan called 1DCyberpunk who stole the band's laptop and would only give it back if fans proved they were as fanatical supporters as she was. In two months, the web site attracted 200,000 followers and ran 20 challenges; started 12 Twitter trends and played more than 2.5 million YouTube views.

The challenges included dressing up as 1DCyberpunk, copying her hairstyle, creating dolls of the One Direction boys, answering quizzes and riddles. Challenge winners got invited to an online album-listening party.

Agency creative director Richard Coggin said, "Syco had a lot of great content -- videos, merchandise, singles, signed photos, radio and TV appearances - and our brief was to glue it all together and engage the fans on a daily basis."

His team worked around the clock to reach their global audience. It paid off, when the debut single What Makes You Beautiful was released on September 11, 2011 - just seven months ago! - and went straight to the top of the UK singles chart. Two and a half months later their debut album Up All Night shot up the charts not just in the UK but also Australia, Canada, Italy, Mexico, New Zealand and Sweden, reaching the top ten in twenty countries.

The band has been involved in the marketing process - they are closer to their fans' demographics than anyone. During the quest, each dedicated three to five hours a week to creating videos, thanking fans for joining them. Their Twitter tag has three million followers.

The girls of America were by now salivating for their social media heroes. What Makes You Beautiful was released on February 14 (Valentine's Day - subtle, eh?) and went straight to No 1. Which makes them the first UK group to debut at number one with their first album.

Just two months later they are in Australia with a seething mass of teens following their every move. Mind you there's not much their mums can click their tongues at, remembering The Beatles hysteria - or even the screams that used to follow our now-respectable Minister for Education.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Menial jobs aren't so menial any more

Melbourne Herald Sun, Friday April 13, 2012

How do you define a "menial" job? Unskilled, short-term, unvalued, replaceable? Well those definitions have been changing for some time. These days, there are not so many menial jobs any more.

How about street sweeping? In the movies you see the sweeper with his brush and cart shuffling along the gutter. Walk down Collins Street any day and you will see a smart council employee in fluorescent jacket riding a nifty little vacuum machine, skilfully dodging pedestrians and reaching all the autumn leaves, while communicating with base on his mobile.

Or take the drudgery of stacking supermarket shelves. A closer look at the assistant sees a computer tablet in their hand, a barcode scanner in their pocket and a look of deep concentration.

What about shop assistants? The girl in Sportsgirl or the boy in Bunnings have control of a sophisticated computer system at their register where they can search the entire country for stock - and give advice about the colour of the frock or the power of the drill.

Ambulance drivers are no longer stretcher bearers, they are highly trained paramedics and MICA resuscitators.

So if your idea of menial workers pictures sad groups of drop-outs and illegal immigrants washing dishes in the kitchens of hotels, you need to know that this work segment is rapidly changing.

In modern marketing-speak this is now called "entry-level work", the first foot on the ladder of a career path. For the most part, it has not been the result of conscious foresight and planning but the social continental shift forced on society by the development of technology.

To put it simply, companies require higher technical and digital skills for almost every job, including those that previously required low knowledge and training.

And fortunately, because of all the "wasted" time spent fiddling with computers, video games, mobile phones and on-line shopping, even our traditional drop-outs emerge with surprisingly high levels of these technical skills.

The job of a new employer, then, is to point the worker to the assigned task and train them for the extra steps connecting what they need to do with what they already know.

Menial work has been rapidly disappearing in the construction industry too. The hob-nailed booted and boozy builder's labourer is fading into the past. Rather than leaning on a shovel, these days they are driving the back-hoe or dogging on the crane. And of course they need to be up to date with OH&S regulations.

It's in the interest of employers and unions to continually push them to increase their skill levels - both for their value in the workplace, and the income they can command. Through TAFEs, unions like the CFMEU, and other bodies, they are offered scores of short courses - six days or two weeks, say - in dozer driving, scaffolding, crane operation and the like. They add them like scout badges and each increases their worth.

I like to reminisce about student days and the awful jobs I would do for the few bucks they paid. Any downturn in a trading period and you'd be thrown out. This was the way for many menial workers, still is for some. But the world has changed.

A company can no longer afford to hire and fire on a whim or a month's poor returns, because these days even a menial job needs a level of skills and they still take time and training to acquire. So maybe those phones and computer games do have a value, making work more efficient - and workers less menial.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

You can be your own agency - you may have to

Melbourne Herald Sun, April 6, 2012

You think of advertising agencies fighting for accounts, pitching against competitors. But you may be surprised to know that they are very picky in selecting clients. It's only the big proven advertisers that get courted. A lot of prospective clients are politely shown the door.

The large agencies won't look at any company that doesn't spend at least a million a year on their advertising. The smaller agencies will take lesser accounts - so long as they can see enough of an income stream out of them. If you only run a bit of advertising, a few times a year, frankly you're just uneconomical.

No, if you're small, you have to be your own agency. But this means forcing discipline on your activities. The greatest mistake small companies make, I call "The Bowls Club Leak".

This is where a company advertises in response to a plea. The local bowls club will give you a page of their newsletter for just $500. The neighbourhood school charges even less. The local newspaper offers to put your picture in its pages. The Lions club needs a sponsor for its footy matches.

Before you are aware of it, several thousand dollars have leaked from the budget - gone to good causes which will have no use for those high quality articulated widgets you produce.

No, you need to plan your advertising like a professional. It starts with discipline.

1) Set your objective. This might be "Increase sale of widgets by 20 per cent in next six months." You nominate a target and a date.

2) Be clear on what you are selling. Is it the widget? Or its installation? Or its ongoing service? Or do you have another product which is more profitable but neglected by the sales staff? You'd be surprised at how many companies are very vague about this.

3) Identify the customer. Make a picture in your mind of who he or she is. Don't say "everybody", select a single man or woman, their age, income, personality - cut their picture out of a magazine and stick it above your desk. Aim at one and you will hit many.

4) What is special about your product, why should they prefer it over any other? Set this point of difference, invent it if you like. Think of Red Bull, Solo and Gatorade. All just flavoured water. But through marketing you would never mistake one for another - and in your mind you can see who's drinking them.

5) How will you reach this consumer in a way you can afford? This is hard because all advertising is expensive and gobbles up your budget. At this point, talk to one of the smaller media consultancies - or buy a drink for a friend in advertising.

6) Next, look at the creative, preparing the advertisements. You now have a clear brief - what you're selling, who to, what's special about it, what sort of ad can you afford.

But to get the ad produced you have to find someone with talent and skill to create an outstanding ad. These are hard to find.

Ask your friends and business associates their experiences. Look at the web, see freelance talent sites like freelancefactory.com.au or elance.com. Spend time looking at freelancers' work samples, till you find a few you like. Don't hurry this process, it's important to find the right person. And don't buy cheap.

Don't be afraid to ask spouse and friends their opinion on the ads - but in the end you are dependent on your taste and instinct, you have the final word. You are now your own advertising agency.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Sometimes to get noticed you have to contaminate the product

Melbourne Herald Sun, Friday March 30, 2012

You've all heard the story of "There's a fly in my soup," or "There's a finger in my pie!" Well how about, "There's a twig in my cider"?

Not only that, but the foreign body was deliberately inserted by the advertising team. It happened in New Zealand to the product Monteith's Cider. It's a nice example of out of the box thinking - or should I say "into the box"?

The brief to Colenso BBDO was to sell cider in a crowded drinks market, as usual with too little funds. But they applied their grey matter to identify what was special about their product. The client had told them that it was one of the few ciders made wholly from real apples, as opposed to concentrate and pulp.

Now, we are all aware of what happens when a foreign body is found in food. The health authorities are alerted, the papers report it, the talk-back runs hot. So our team decided to use this reflex for their marketing. They put twigs of apple tree into the product.

Oh, not into the bottle let me reassure you - that would have been illegal. They dropped a couple of twigs into each six-pack box of cider. Sure enough the complaints started coming in to the brewery's exchange. "I found twigs in my cider pack", "What are you going to do about it?", no doubt hopefully looking for some compensation for the "error".

They called the radio stations and the newspapers and soon the country was buzzing with this "contamination" story. At which point Monteith launched their newspaper and poster campaign.

Headline: "Sorry about the twigs, folks". The ads then went on to explain, "Because we use real apples in our cider, you may find real twigs in this box." And everywhere big labels, "Not from concentrate".

They're talking about this campaign as far away as London and New York. Don't you love those little brain bubbles that turn into global ideas? Of course it has to happen in the right place at the right time.

For cider the time is now. All of a sudden this little bottom-of-the-shelf drink has come into its own. Ibisworld Research reports that in the past five years Australian cider sales have jumped by 19 per cent every year.

Currently our beer consumption is at a 60-year low, yet last year cider sales increased by more than 30 per cent - which on the chart looks like the trajectory of a rocket ship.

The theory is that cider is finding its own "middle ground". Less bitter than beer, less alcoholic than wine, it has carved a refreshment niche. While it was long looked at as a girls' drink, it is now appealing increasingly to men. And the advertising campaigns are encouraging this.

Cider of course comes from olde England, it's the traditional West Country drink. Until recently their market was declining to perilous depths. Then along came Magners Irish Cider with a funny, catchy campaign running the slogan "There's method in the Magners".

It was positioned as a sophisticated drink over crushed ice and sales took off - 250 per cent in a year. Pulled in the wake came other small ciders, and the big ones too, Now cider is cool - in the UK and in Australia too.

Foster's, Lion Nathan and the other brewers are pumping out new cider brands as fast as they can grow the apples. Pubs and retailers are making more space on their shelves and among their pumps for the emerging brands. So if you find a twig in your drink, ignore it.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Are you ready to market yourself? You should be prepared

Melbourne Herald Sun, March 23, 2012

When you're working you see so many jobs where you could improve your work, your pay, your position. It's like they are all beckoning to you. Then if by chance you find yourself out of your job - it's amazing how these opportunities evaporate like a morning mist.

Suddenly you're back on the market, out in the cold, and it's not so easy to get back into the warm. Ok, my marketing friend, in these times of mass redundancies and weekly announcements from yet another corporation laying off hundreds of staff - how are you going to market yourself?

The reason why companies like to poach staff from others is because they know the employee is current. The candidate knows today's business, the personalities and the deals, so they can slot straight in - often in opposition to their pervious firm.

If you're not in this position, you need to make them think you are. So keep up your contacts, go to those boring industry association monthly breakfasts. Everybody is there for the same reason - to see and be seen by someone who could be of use to them. Sit near someone who works for the type of firm you're looking for, and be chatty.

Get abreast with the new media - these days recruiters and employers look at your Facebook profile (no photos of drunken nights!) and tap in to your Twitter. Is your resume on LinkedIn? Get your blog up to date and work-oriented. Ideally make the employer think they will be hiring extra muscle for their social networking drive.

Take a hard look at your resume. Does it make you sound exciting and desirable? Is the photo friendly and professionally shot or does it look like a depressed passport pic? (What do you mean you don't have a photo on it... Do it!)

In fact write more than one resume. The one looking for a marketing post needs to be different from the one looking for the advertising agency job. If you can, put in some case histories of successes including a few figures on sales or market share - or whatever is appropriate.

Here's one for the brave - put together a clever but brief Power Point presentation of your resume, for your laptop or iPad. But only if you can make it engaging, not boring.

In any case, get your story straight and make yourself interesting. Be able to talk confidently in the interview, but don't sound arrogant. Make good use of the bathroom mirror in the morning to practice your pitch. Remember to smile and be light - but don't tell a string of jokes.

Call your girlfriend who has style and understands fashion (this applies to the boys and the girls). Get her to search through your wardrobe and put together a couple of suitable business looks.

Even in these days of relaxed clothing rules, there is still such a thing as an "acceptable" look. It's an unspoken dress code but those with an eye for fashion can read it well. As can most prospective employers, even if they don't even realise that they are making such judgements.

Your tattoos might be very cool among your mates at the night club, but they send demerit points to a prospective employer. Cover the tatts - and lose the nose ring too.

What an employer is looking for is someone who is skilled, flexible and resourceful. And the best way to prove these points is by getting your marketing pitch and materials right for each prospect.

Here it is my marketing friend - your most important client. Get to work.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Mad men and motor bikes

Melbourne Herald Sun, March 16, 2011

The TV show Mad Men, on SBS, presses all my nostalgia buttons. A recent episode showed a drink-fuelled agency celebration where the client's John Deere ride-on mower was raced around the office corridors.

Which flashed me back to a drink-fuelled agency celebration at Masius in 1970. A client's promotion had as its first prize a Yamaha motorbike, which had been brought in for photos. I was a junior writer but my copy chief finally couldn't resist, threw himself on and roared several circuits of the Queens Road office corridor.

He's since left the business to become the Great Australian Novelist - Peter Carey. And the bike was then taken round the corridors by my fellow cadet, Terry Durack - who these days is one of London's leading food writers.

Oh yes, Mad Men is written out of intensive research, including consultants who lived the action at the time. What you see is real.

Here in Australia we worked very hard to emulate our heroes in Madison Avenue. I well remember the ash tray piled high with cigarette butts next to my typewriter. The after-work drinks in the board room that, after a time, I realised I would have to stop attending or turn into an alcoholic.

Ah, the legendary long lunches. Any excuse would see us visit a fine restaurant with our company-provided credit cards and disappear till late afternoon. The clients were eager accomplices who somehow always set meetings which would necessitate us going to lunch. The agency didn't worry - they saw it as cultivating the client.

The peak of the excess was the Melbourne Art Directors Club Christmas Party in 1983. Somehow they got permission to take over Gunn Island in the middle of Albert Park Lake. On it they built tents for circus acts, side shows, food and grog, very loud bands and fireworks. Guests were rowed over in boats, and at the end of the night most were rowed back. However some very expensive designer dresses and tuxedos ended sloshing to shore through the lake mud.

I'm glad to see that there is still some creativity left in advertising. Not in the ads, alas, but there's hope ahead. It took my South African friend passing me a YouTube video doing the rounds in London, to find out what's happening right here.

A writer-art director team were having no luck in getting work at the big agencies, not even interviews. So they designed a campaign. They registered the names of Melbourne's leading creative directors, as web sites. Like bencoulson.com (Pattersons), grant-rutherford.com (DDB), matgarbutt.com (FCB), and announced they had taken the sites hostage.

The ransom was - to interview the team with the possibility of a job. Should any victim fail to respond in time, their site would suffer a traumatic blow to their reputation: redirection to Justin Bieber Under the Mistletoe.

Unable to withstand the threat, seven CDs agreed. Our lads turned up with suits, lap tops, and ski masks, and pitched their credentials. The result, they report: "We met seven creative directors, freaked out nine receptionists, and found a job!"

The team are Andrew Grinter and Lee Spencer-Michaelsen, now working with Ogilvy Melbourne - ironically not one they targeted, but which heard the buzz. So the pair of RMIT 2010 grads is now on the ladder - and their site has garnered 66,000 views around the world. I think the lads will be going places.

It is with relief then, that I can report there are still some mad men working in our advertising industry. All they need now are a few mad clients.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

How to raise money without the vulture capitalists

Melbourne Herald Sun, Friday March 9, 2012

Lightning struck when Scott Wilson saw the new-generation Apple iPod Nano music player. One of its functions is a clock face. Only four centimetres square, it would make a beautiful multi-function watch.

A designer with a small studio in Chicago, it didn't take Scott long to sketch a stunning strap to hold the watch. But how to fund such a new invention, without giving most of it away to the vulture capitalists who feed on bright ideas?

He posted it on the Kickstarter web site. It's a new marketing innovation called "crowdsourcing". Here's how it works.

Scott made his sketches into a persuasive home-shot video that explained the idea and asked for funds. This was loaded on the site, with a money target: $15,000. He also blogged a designer friend.

The friend passed the news to more friends. At eight one morning the offer went on line. Pledge $25 and you will receive a Tik Tok Watch kit, if and when it is produced. A $50 pledge gives you the classier aluminium Luna Tik kit. If the project fails to reach the target, nobody pays anything.

Well by 5:30 that evening, his wife texted that $6,000 had come in. By the time he got to bed it had reached $80,000. To date it has exceeded $942,000. And not a banker in sight.

The power of Kickstarter has now extended to Australia. Two young Melbourne designers, Rob Ward and Chris Peters, conceived a simple idea last July: an iPhone case with a built-in bottle opener, the "Opena".

They set a $15,000 target. Within days they had raised $28,000. Because Chris is an industrial designer, and Rob a toolmaker, they were able to get the product made quickly - in China of course - and into their own online store.

A few months later, another idea. The Quadlock, a kit that mounts your iPhone onto a wall, bike, desk - anywhere. (Kickstarter people are very Apple, you'll notice.)

They made a prototype and video and launched it on Kickstarter last December. By January 15 they had raised $41,000. They have now signed a contract with a US distributor.

Crowdsourcing is part of the new marketing wave made possible by the internet. It lives in the realm of blogs and facebook, email and twitter, google and eBay. To those in that world, this is the new reality - boundless creativity with no restrictions.

There are a number of crowdsourcers - IndieGoGo, ChipIn, and Australia's own Pozible. Much of their work is not technical but with creative concepts. Looking for funds to make an indie movie; mount an art exhibition; publish a CD. Singing duo The Voltaire Twins raised $6000 to go play in Canada and the US.

Half the projects don't reach their target. So there's no charge to promoter or pledger. Successful projects pay a five percent fee.

The online store developer Shopify ran a best-sales competition last year. 3000 of their clients sold more than $12 million worth of product. The winners in one category were - Rob and Chris. Another was Brad Jorgensen of My Footy Boots, also Australian.

In fact Oz, with eight percent of the 3060 participants, delivered 38 per cent of the contest winners. The Yanks are looking at us with new respect.

What the winners have in common is a fierce use of social media. They blogged and twittered and facebooked till they dropped, but got the message out.

For Rob and Chris the breakthrough came early - when Ashton Kutcher tweeted about Opena to his 7 million followers.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Is there life after political death? You betcha.

Melbourne Herald Sun, Friday March 3, 2012

I sometimes wonder about my colleagues issuing the big stories from the Canberra gallery - do they realise that yes, there is a life outside politics, and it starts with a little clever marketing?

Take this week's hand-wringing over the resignation of Mark Arbib. He's a powerful force in Parliament, one of the "faceless men" due for his rewards, probably a Cabinet seat. Why should he leave the levers of power and return to Sydney?

Well I'm sorry, this is where I'm a heartless cynic. You see for years I have been watching how the smart folk time their exit from politics. Think about it.

You don't want to go after an electoral defeat, when the market is awash with unemployed ministers and parliamentarians. The smart ones get out a year or two before there's the risk of it happening.

While your party is still in power, the important people take your calls and you get lots of appearances on Lateline.

Remember John Dawkins? Federal Treasurer for Paul Keating who resigned and quit Parliament two years before Howard's comeback. He ended up as a lobbyist for Government Relations Australia, and a director for the likes of Elders Rural Bank, Fortunes Fund Management and Genetic Technologies.

So yes there is a life after political death - better paid, too.

On the Liberal side there are even more waiting arms. When Peter Reith quit in 2001 he took up work with warship builder Tennix, neatly splicing his two previous jobs as Minister for Workplace Relations and Minister for Defence.

Peter Costello donned his "greatest treasurer" sash and joined some of Goldman Sachs' heaviest weights, forming corporate and government consultancy BKK Partners. As Managing Partner. Then last year he joined two former staffers in setting up ECG Advisory Solutions, a lobbyist with clients like Wesfarmers and Fortescue Metals.

Lindsay Tanner has only recently departed and is greatly missed within the ALP, we are told. However he won't feel lonely. As a senior adviser with Lazard, one of the world's great merchant banks advising corporations and treasuries around the world, he has the company of chairman Paul Keating.

Showing true bipartisanship, when Alexander Downer quit in 2008 he joined ex Labor senator Nick Bolkus and Natasha Stott Despoja's husband Ian Smith in lobby consultancy Bespoke Approach. He also warms a seat in a global merchant bank, Cappello Capital Corporation.

Now are you beginning to see that our departing ministers will not have to sit in draughty Centrelink corridors for months? This is quite apart from the very generous superannuation scheme that covers our politicians.

Of course retired pollies are invaluable to a corporation or institution. They intimately know their way around the corridors of power, they know where the bodies are buried. (Some they planted themselves.)

They understand the bureaucracies and have the private numbers of the departmental chiefs. Besides, a famous name looks good on the letterhead, especially as it is usually followed by a string of honours.

You need shed no tears for departing Senator Arbib. He has a reputation proclaimed throughout the media as a brilliant planner and plotter, a mover and shaker. Just what a major corporation wants in its leadership team. He exits applauded by the Prime Minister from the floor of Parliament. What better recommendation for the CV?

Before him he has a highly-paid new career, working nine to five with no sleepwalking early morning divisions. And he gets to spend time with his beautiful kids. If that's political death, we might see more leaping from the ramparts of Parliament House in the coming year.

ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Welcome to television's wide wonderful land of rip-offs

Melbourne Herald Sun, Friday February 24, 2012


Television has always been a land of rip-offs. For ever, producers have spotted successful shows overseas, brought them home, re-badged them and sold them to local TV.

But now, see how the world has changed, it's our ABC screaming "Thieves!" at their British cousins the BBC.

Here's the format for their latest TV show which started last week. They put together a panel game with a presenter and four guests, showed them TV commercials, and asked for their comments. Sound familiar?

No, this Pommy show is not The Gruen Tansfer, it's called the Mad Bad Ad Show. And from what little I've seen so far, they managed to not only pinch a good concept, but to screw it up.

What makes Gruen work is that it has a comedian host with four presenters who are genuine, experienced, working ad people. Whereas in Mad Bad they have put together a humorous host, with two other comedians and two ad people. So it has turned into a laughathon - with lots of unfunny jokes.

Beneath its humour, Gruen studies and analyses its subject seriously - which actually makes it a much funnier show. Its creator, Andrew Denton, says "The UK producers have taken the default position of throwing comedians at it, it's a mistake, the ad men end up looking flat." Not totally displeased that larceny has failed, he prefers to call the result "a homage" to Gruen.

Here's another TV concept for you. With the Olympics coming, a committee is gathered together to prepare this huge project. And of course every kind of chaos and catastrophe hits them week after week, making very funny reality-looking television.

Sounds like John Clarke's The Games? Actually it's a BBC series called Twenty Twelve , currently running as Britain prepares for its own Olympic Games. Interestingly, Clarke's team had offered the idea to the BBC but were turned down. Then amazingly the Beeb had the same idea themselves.

A team of London lawyers is studying the situation, but I wouldn't hold my breath. Copyright is a very tricky area. It applies to "a work" - a book, picture, tune - but not necessarily to concepts. The law likes to hold two things side by side and decide whether one is a copy of the other or not.

But the rip-offs tear in both directions. Take Britain's Never Mind the Buzzcocks - a panel show where six entertainment celebrities answer questions about music and musicians. Sounds a lot like Spicks and Specks? Well at least they don't get prickly about the similarities - one of the Buzzcocks' long-running "captains", Bill Bailey, was also a popular guest on Spicks.

Or another panel show, where the guests have a great time making fun of the week's political news from around the world? Surely that's Good News Week? Yes but it's also Have I Got News For You which has been running in Britain since 1990.

Perhaps, as in business, some of the happiest arrangements are franchises. Master Chef was UK born and has since spread around the world. The logo remains the same, but many new territories use a version developed in Australia.

The most successful franchise has been Who Wants to be a Millionaire which has travelled from the UK to 100 countries. Its long successful run in Australia ended in 2006, supposedly because Eddie McGuire became Channel 9's CEO. But I suspect it had more to do with October and November 2005, when two contestants each became millionaires.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

The value of work experience

Melbourne Herald Sun, Friday February 17, 2012

When you see the nervous look in the client's eyes, you know he is going to ask you a favour. "Er - Ray - you know my daughter's 15 years old? She's very interested in marketing and advertising."

First time I'd heard that, I thought. Here it comes.

"Her school's having a work experience week - I don't suppose you can take her here?" Yes of course, you're friends with the client and keen to keep the business so how can you refuse. But - what on earth are we going to do with the girl?

It's a problem I'm sure has been faced by every business at some stage. The big ones can find a spot for the child in the dispatch room or let them sit with different departments over the week. For smaller firms it can be a bit of a burden.

The problem is, all too often the kid has no interest in the business and little understanding of what it does. The staff are too busy getting their jobs done to give them much attention, so our schoolie could spend much of the week keeping out of sight, playing with their iPhone.

There is a place for kids in the workplace. The evening job or holiday work can be very educational. I have seen McDonald's turn out some very hard-working, diligent students after a couple of years flipping burgers. But it can't happen in a week.

Unfortunately too many of our kids are growing up in families that, in my youth, would have been regarded as rich. Plenty of pocket money, mum and dad to taxi them around, lots of after-school activities, big presents at birthdays and Christmas.

It blunts the hunger we remember, of having to save for months to afford the second-hand camera you desperately want. (Insert your teenage desire here.) These days all they have to do is mention that a new 12-megapixel single lens reflex would be nice for Christmas and the distracted parents put it on their list.

Now it's time for "When I were a lad". In my teens, if you wanted a holiday you'd go work in a factory for a month to save up for the trip. Two of my summers were spent sweating next to the conveyor-belt ovens of a cake factory, spraying the cake tins with fat and coming home each night covered in a thick film of grease.

Another job was working in a holiday resort - as a bar porter stacking crates. While the world around you was having a ball, you were the poor peasant in the background carrying dripping empty beer bottles, shouted at by the supervisors, bar staff, everyone.

But it was a great education. I returned to my studies with fresh motivation - no way would I drop out and end up in a job like those.

In the past decade more thought has gone into the work experience field, with laws and forms, regulations and manuals to create more structure around it - and more bureaucracy of course.

Ideally, the school should have spent several weeks preparing the students for the experience, so they have some idea of what to expect - and to realise that they can't get away with insolent behaviour like they can at school.

The parents should be involved, with dinner, advice and sympathy each evening.

At your end, the company supervisors should sit down beforehand to discuss what would be the most useful lessons the child could gain.

Have a plan, have some tasks ready - but don't be shy about giving them some dirty jobs. It could be a valuable career-planning lesson for them.

ray@ebeatty.com

From roses to jerky, the gift is love

Melbourne Herald Sun, Friday February 10

There's a florist near my place who has been on holiday most of January, just locked the doors and went away. But he's back now and will pay for his leisure time by staying open, day and night, the whole of February 13 and 14.

Yes Valentine's Day is coming, the pot of gold in every florist's year. Behind them of course are acres and acres of greenhouses where careful growers plot and scheme to make sure that a million roses will open up at just the right time so as to be not too buddy and not too bloomy when they are ribboned and presented.

Valentine's Day is a great example of "occasion marketing" - when an occasion or tradition is seized upon by marketers as an opportunity to sell more of their goods. We've just been through a couple of these, called Christmas and New Year.

Truth be told, there is no reason why one person should buy a gift for another just because of a day of the year - but without these days, our retail economy would be even more dismal and subdued. Our love lives and marriages would suffer a severe downturn too, if the partners neglected to observe the occasion.

The Valentine tradition we know today can be traced back to 1797 when a London publisher put out a booklet of sentimental verses called The Young Man's Valentine Writer. The real St Valentine was martyred by the Romans in 289 AD and as a bishop, was unlikely to have had a secret lover.

The tradition has grown in size and value for two centuries, to the point where it is spreading world-wide. In recent years, relentless marketing has planted the Valentine - the gift-giving part, anyway - in Asian cultures like China, Korea, Singapore and Japan. Not always on February 14 and not always boy to girl.

In Japan girls give chocolates to their male office colleagues. In Taiwan it's men to women. All very confusing but with one essential ingredient - a massive increase in expenditure on certain products.

So, you must have wondered, how can you get your product in on this buying flood? Can you disguise your widget as a Valentine gift?

Well plenty have tried. Obviously the makers of greeting cards, chocolates and teddy bears got into the act early in the piece, as did restaurants.

You'll find this paper will do a roaring trade next Tuesday with columns of personal ads decorated with hearts and flowers as all and sundry Romeos declare their love. Your message will be seen by a million and a half readers - one of which, hopefully, will be your love.

Later sales steps were a bit of a stretch. In the '80s, American jewellers started promoting diamonds as a suitable gift. No doubt to remind the girl of her other best friend. Some may think it's a bit of a leap from an embossed gift card, but hey that's marketing.

The rule is never miss an opportunity, which is why this year Interflora have launched a campaign aimed at gay and lesbian lovers.

Then come the ideas which must have struck their creators in the middle of a sleepless night - "I've got it!"

How about a message in a bottle, delivered in a little box. Or giving her name to a star. As our own Milky Way has two hundred billion, we won’t run out of stock.

But some show real imagination. One firm is promoting beef jerky treats. No, not for the girlfriend's teeth, but to let her know you also love her dog.

ray@ebeatty.com

Nigella Versus the Supermarkets

Melbourne Herald Sun, Friday February 3, 2012

Nigella Lawson walks into a quaint old-fashioned greengrocer's and spouts lovingly about the beautiful vegetables and fruits in their handsome cane baskets.

She picks up a pair of eggplants, holds them above her ample bosom and drools about how fresh they are. Meanwhile your wife wonders why you have suddenly developed such an interest in TV cooking shows.

For the most part, though, buying fruit and veg is not such a sensuous experience. We dash into the supermarket, grab a few spuds and greens, and rush off to prepare for tonight's dinner.

Greengroceries are a staple that we cannot live without, and they represent $15 billion of our annual spending. As we know from the posters and ads that follow us from the kinder to the nursing home, we should all eat more fruit and vegetables, they are good for us and necessary for our daily health.

Not that we have been taking much notice. Surveys by researchers Morgans show that in the past eight years our spending on fresh fruit and vegetables has barely changed.

What has changed is where we buy our greens. The supermarkets have put relentless advertising pressure into pulling us into the stores, knowing that once inside we won't buy the potatoes without the meat, gravy and trimmings.

So the category becomes a "lost leader". That's where the supermarket cuts the price of goods to below cost just to drag the customers in. It's the same trick they have been using with milk.

There's a lot of this going on right now, if you leaf through the pages of this newspaper. Coles lost a lot of ground in their produce department under the relentless advertising of "Woolworths the fresh food people". Morgan's found a severe drop of Coles market share against Woolworths, from 2005 to the present day.

This week Coles launched their campaign slashing their green prices by half. What's surprising is that it took them so long to respond to the challenge.

In the fresh foods area, Woolworths sell $8.6 billion as against Coles' $6.3 billion. In greens the proportion is greater - 26 per cent versus 19.6. Coles had to fight back.

Unfortunately this battle between supermarkets makes everyone else become the tortoise in the field when the elephants fight. Already the two giants, Coles and Woolworths, own half of the business, with just one third of the nation's expenditure going to fruit shops and traditional markets.

The vicious price-slashing is easily done by the huge corporations that will just budget the losses as marketing expenses. For the little strip greengrocers it will be further pressure in their decline.

And it's no point in turning for help from governments of either colour. As far as they are concerned, cheaper grocery prices make them look good and as in the past two decades, when questions of unfair competition are raised they will look the other way.

So it comes down to us as consumers to change our buying behaviour. We are more aware of good food than in the past, thanks to shows like MasterChef and My Kitchen Rules, and celebrities like Jamie Oliver and of course Nigella.

We need to use this new enthusiasm to give support and encouragement to the Marios and Kostas and Borises of the shopping strips. They understand their vegies, know them far better than the schoolkid trimming lettuce in the supermarket.

Get talking to them to learn more about a bigger range of greens and exotic dishes. Oh, and keep your eyes open for lovely ladies and lads who take the time and care to smell the fruit.

ray@ebeatty.com

Kodak and the Death of Dinosaurs

Melbourne Herald Sun, Thursday January 26, 2012

I hate repeating myself, but some stories keep happening again and again. Anyone with any doubts on the science of evolution only has to follow the events catalogued in the endless flow of this Business Daily.

Here we see the survival of the fittest, the extinction of some of the greatest dinosaurs to ever walk the planet, replaced by the nimbler, more resourceful mammals.

What I'm talking about is the death of that great brontosaurus Kodak. Yes, along with many of its species, it is now under US bankruptcy protection - the palliative care ward for American businesses.

Of course we were warned well in advance, when the Australian operation closed in 2004. Already the writing was on the wall. The US operation was so much bigger, it took longer to die. But did it have to?

As always it is never just one event that causes the demise. Did they cling to their legacy business - film, paper and cheap cameras - too long? Yes. But it was, and is, still big business. What will yet rise up from the grave is still to be seen, but it surely will be a ghost of the proud 131 year old company that passed on.

Kodak were undermined on price by competitors like Fuji. Digital cameras came on with a rush - it's like everyone acquired one overnight. And the explosion of smart phones means that everyone now has a camera in pocket or purse.

How can such a giant falter? Last year we saw Borders collapse in a stack of books and in the States, American Airlines is doing its own Chapter 11 taxying right now.

The irony is that Kodak could have made it, they had all the ingredients and there's no doubting their muscle. Did you know that a Kodak engineer created the first digital camera? They invested lots of time and money into developing the technology and intellectual property still earns them huge royalties today - from other camera makers who have leapfrogged them.

But they never really believed that digital was going to overrun film so completely, so quickly.

They were like Xerox, who were developers of the key ingredients of today's computers - the graphical user interface, the mouse, the laser printer. Yet while Apple and many of the upcoming computer companies made fortunes, by 2000 Xerox were staring at bankruptcy.

Fortunately a new company president, Anne Mulcahy, who started in sales, suggested they talk to the customers - and saved the company.

This is what Kodak didn't do. Or maybe they were talking to the wrong customers. They didn't have the Apple design flair or the insight to extend their products out through web communications or social media - which is what all their competitors are doing now.

They developed the first wi-fi enabled camera, but when it didn't reach the sales targets they killed it off. Can you see the pattern here? When the going gets tough, the big run off.

Like IBM, who gave us the most successful personal computer system, but abandoned it to the clones. I always felt that the carpet bazaar haggling and trading that is the PC market never sat comfortably on those grey-suited shoulders.

When I look at the torment of these dinosaurs I see the big corporation curse: inflexibility and bureaucracy. So many of the key ingredients of today's technological revolution were not invented by Bill Gates or Steve Jobs but by Xerox and Kodak and IBM.

Where were these corporates , I wonder, when the young turks were plundering their basements? Probably in committees discussing the distribution of paperclips.

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com

Big Brother is coming to your living room

Melbourne Herald Sun, January 20, 2012.

The name Big Brother comes from George Orwell's chilling book 1984. In it, everybody is watched and monitored. Which is why they called the TV series Big Brother. Day or night nothing is missed.

Well there's good news for marketers. You can be a big brother too and know all about your customers, thanks to the latest innovation released at this year's huge Consumer Electronics Show in Las Vegas.

It's a TV that views the viewers. Yes, many new models will have build-in cameras so that you can be watched. Isn't that good? Or is it absolutely terrifying?

In this ever-more connected world, the new TVs will be part of your network with the outside world. They will link you straight into Facebook so you'll be in contact with your friends.

How will the TV know it's you? With built-in facial recognition, it will notice when you enter the room and say, "Hello Julie". Or whoever.

The picture will be brilliant with new Organic Light Emitting Diodes (a new world to learn: OLEDs), and just four millimetres thick. You read it right. Not much thicker than a sheet of cardboard.

What's exciting for market researchers is that they can now get a true measure of TV audiences. They can count who's in the room and recognise each viewer. No more arguments about were they having a toilet break during the commercial.

They can even tell whether you are enjoying the program or are bored, by scanning your facial expression.
Technology has even more delights for you. You don't have to feel lonely any more, even while you're watching TV. A product called DirectTV will tell you what programs or movies your friends are watching, so you can watch with them too.

Another called IntoNow will analyse the audio signal of your friends' program through an iPhone app, and share it with your friends through Facebook.

Maybe I'm the wrong generation but I can't think of any friend who'd want to watch a TV show just because I was watching it. Must be lacking in empathy.

Getting back to the commercials, the new key word is no longer viewers or audience, but "impressions". To quote Rex Harris, from advertising agency group Publicis, "If you're looking elsewhere, then you're not paying attention. We would like to know if we're getting accurate impressions."

So the advertiser wants to know the ad is being watched, but wait there's more. Having recognised you and matched you with their huge database in the internet cloud, they know what you like. So the ads shown will be chosen to appeal directly to you.

Now this is very convenient and time saving for you and - doo-doo-doo-doo-doo-doo - spooky.

What also came clearly out of CES was the interconnection between technologies. Quoting Rex Harris once more, "People are increasingly consuming content on their smartphones, tablets, and now through devices that bring the internet to television - converged TV."

In the book, Big Brother didn't give you any choice whether you wanted to be watched or not. So expect the next big debate: Should you opt in, or opt out?

Already in America the discussion has quietly started. The big buyers of media want an opt-out approach. That is, unless you tell them not to, they will log you on. The civil libertarians want it opt-in. If you want a camera filming your living room, you have to ask for it.

So are you in or out? I suppose it will depend on how many friends you've got - and how much you want them to see of you.


ray@ebeatty.com
Blog: themarketeer-raybeatty.blogspot.com

Is he a dork or a millionaire businessman?

Melbourne Herald Sun, January 13, 2012

A quote from author Colleen McCullough caught my eye, about her willingness to express unfashionable opinions: "I like Prince Charles. I don't care if the world thinks he's a dork. I don't care.''

Exactly my thoughts, I agreed. While many in the media enjoy making fun of him, I find myself approving a lot of his opinions on conservation, sustainable food production, and the hideousness of so many modern buildings. If I were a gardener I'd probably talk to my tomatoes too.

So is he a twerp? I decided to take a closer look. What I found was a very successful CEO who works harder than most businessmen I know of, and then gives much of his income away.

Although I'm a republican, I must say that Charles gets a raw deal in the media. Firstly, all the talk about how many millions he costs the British public purse.

The money comes mostly from his inheritance, the Duchy of Cornwall estate. The income is his, as bequeathed by Edward III in 1337 to each monarch's Prince of Wales, but he is not allowed to touch the capital.

However he manages the billion-dollar business, generating about $26 million a year. "The Firm" (as the Royal Family calls itself) claim that he has doubled its capital value in the past decade.

The income comes from those famous organic farms, of course, but also from large numbers of rented farms, properties and commercial buildings.

Incidentally they have a very nice range of holiday cottages in England's south-west decorated in the very best Country Life chic, at around $1000 a week for a four-sleeper. Better price than most hotels.

There's a range of foods called Duchy Originals from Waitrose that sells the estate's organic products through supermarkets, and exports as far as Australia. And there is a fat investments portfolio to be managed.

But this isn't his day job. He spends much of his time tearing around the country attending meetings and opening bridges (639 engagements last year. Doesn't that make your eyes glaze?) And 73 of them were overseas, as he buzzes around the world spruiking British products and culture.

Much of this work is done at the request of the UK government and foreign ministry, so you can sympathise with his expecting them to cover the air fares and accommodation.

He helped to raise $180 million for charities, including sizable donations from his businesses.

On top of this he also funds part of the income for sons William and Harry, and now his new daughter-in-law. Luckily they have their own jobs to help out.

He pays tax like the rest of us - $6 million last year. Of course, like any businessman he has regular arguments with the taxman, and in his case Parliament, about what is deductible and what isn't.

Then there is aforementioned son and daughter-in-law. Like any father, last year's wedding cost him a fortune. Though fortunately his own mum and dad, and Kate's, paid most of the costs.

Not the police and marching bands, mind, they came out of the public purse. I remember musing at the time that if they had charged for worldwide TV rights like the Olympics, they would have come out in profit. Considerably.

Meanwhile William and Kate are getting themselves ready to take over the family business, practising their fixed smiles and staying awake. Kate has turned into a godsend for British fashion designers. When she bought a $50 skirt at Topshop, the chain sold out by the next day. Now that’s marketing power.

ray@ebeatty.com

The cargo cult is still growing strong

Melbourne Herald Sun, Friday January 6,2012.

It has become a tradition for this column to start the new year by surveying how we are progressing with what I call our “cargo cult economics”.

You remember cargo cults? The natives of New Guinea watched the American planes come in during World War II and unload guns and jeeps, tools and clothes, PX Stores full of groceries.

After the war the planes stopped and witch-doctors told the people they could start things up again if they built airports and conning towers and radar scanners. This they did, from bamboo and straw and coconut shells. But somehow these didn’t work.

This caused years of unrest because the villagers did not understand that behind the goods there had to be an underlying economy of funding, planning, work and building.

Well we in Australia and the western world are not so different really. We’ve seen our wealth delivered by ship and plane for half a century, from America and Europe and particularly China, and today we’re getting more than ever. All they ask for is a few shiploads of dirt from our backyards, and our signatures on some IOUs.

But lately the cargo cult has been getting a big shaky. Over in America when some of their bamboo and coconut airports collapsed three years ago, it took them a long time to recover. In fact there are still clans of natives sitting around waiting to get back to work again.

Of course this causes unrest and their leaders have been blamed and chased around the political jungle with machetes. Just this week in Iowa the bosses of several clans were arguing over who will fight to become the new chief of the tribe. Each one promised more goods, more wealth, less work.

Europe was so solid and confident but now the tribes have all fallen into argumentative conflicts over who has the most pigs and whether they will pass them on to the poorer tribes.

The Greeks are not so worried. Two and a half thousand years ago they had a very successful economy where slaves did all the work and the citizens sat around the agora arguing philosophy and creating democracy - for those who were not slaves. Old habits die hard and they still confidently expect their daily wine and olives.

The Italians are another ancient race. They have not had a strong central government since Mussolini made the trains run on time, so they don’t see much point in paying taxes. As always the gods will provide, it’s not my problem they say.

As you’d imagine, their straw and copra airports are stunningly designed and exquisitely crafted. But they are not much better at generating magic wealth.

Any suggestion that they should contribute their share of pigs and bananas to the communal kitchen is rejected with horror. Though their refusal is mild when compared to the cries of outrage from the rich Americans if asked to give the tribe more of their pigs. They’d rather cut back on their medicine men.

And so all over the world we, the wealthy tribes, sit around waiting for the cargo planes to fly in more and more goods, as our right. Where they come from doesn’t seem to trouble anyone; who will pay is a problem for later on; the fact that the sea is slowly swallowing the tropical paradise is no worry for those of us in the highlands.

Down here in Australia there’s nothing to worry about so long as there is someone willing to pay for our dirt. We don’t even have to make any goods any more so we can shut all those tiresome factories.

Instead let’s sit back, fire up the barbie, and build another grass and bamboo airport. Look, they’ve worked so far, why not for ever?

ray@ebeatty.com

Blog: themarketeer-raybeatty.blogspot.com