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Billy Mays-Death of a true salesman

The passing of Michael Jackson had overshadowed all other news but I thought we should not miss out celebrating Billy Mays. I find Arthur Miller's play somewhat unkind to the sales profession and thus the "true" for Billy Mays. Billy Mays was a true salesman and a great pitchman on TV.

What makes personal selling so effective is that when you speak directly with a prospect,face to face and one to one, it has the biggest impact on closing the sale.To do so via television is very difficult and Billy Mays was very good at it . You wanted to believe him and put out the $20 or so that he suggested you spend to acquire a product that sure looked useful.He did the "convincing that it is useful" really well. To do so for a mass TV audience is a rare and remarkable skill.  My guess is that Billy Mays was not only able to sell the products he pitched but the products "stayed" sold. Probably customers who bought Billy Mays pitches returned less product as he upped the satisfaction levels right at the sell stage.

Here is a clip from the Tonight Show to learn enthusiasm from Billy Mays:

New Business Model for Music Industry needs new ways of capturing value

First record stores were closing in the US as everyone wanted to download music.The record stores were affected as distribution moved online with iTunes selling millions of downloads. The music recording industry was kind of okay with this as they still had a method of capturing value or monetizing their efforts of promoting artists and marketing music. But that was in the US.

It turns out that in China most music ( over 99%) is simply acquired free ,violating copyright laws and disabling the music industry from capturing value. Google in China is offering free music downloads and hoping that AdWords will help capture some tiny piece of value through ad revenues. This ad revenue will be shared by the music industry and Google. In other words, music companies have given up on trying to implement the US business model in China.

Musicians and artists I suppose love all of this as their music gets exposure and anyway they did not make big money in the traditional model where record companies,distributors and retailers made most of the margins and customers had to pay. This industry is sort of different because the musicians work primarily on the premise of "live to work" rather than "work to live" in sectors like banking and auto which seems to be having trouble in recent times.In fact,bankers are leaving banking (they don't love banking ?) given the cut back on bonuses.

The restructuring of the music industry in China  should spread to the US in due course and dis-intermediation of the distribution channels and record companies will create interesting opportunities. You can be sure that musicians and artists will proliferate and new ways of "capturing" value will have to be built.

Small Business, Google AdWords and B2B Marketing in a recession

If you think about it, most jobs,innovation and entrepreneurship is in the small sector. Strangely textbooks and academic work in  B2B,Supply Chain and Innovation focuses on large organizations- perhaps because large organizations are potential employers for students who read textbooks  and have been traditionally employed by large organizations. The current economic situation has many major organizations in disarray with employment being uncertain for existing managers and on hold for fresh recruits.

Students at my B2B (Organizational) Marketing class at University of New Haven are participating in the Google Online Marketing Challenge (GOMCHA). They have a presentation scheduled on April 8, Wednesday and the University announcement is here.

The students have been doing a great job and have focused on creating AdWords for B2B marketing in a recession for the seven area businesses. Google AdWords puts power in the hands of a small business who can start with a very small budget- unlike other traditional advertising. The GOMCHA itself is supported by Google who have given $200 of ad credit to each student team.Students add the Internet Marketing expertise to their resumes and I think several of them will become entrepreneurs. The student chapter of the American Marketing Association is managing the event.

Closing Newspapers changing Ad World

I have found myself not signing up for subscriptions renewals for magazines and papers I love even when the rates are really cheap ( some as low as  10$/year promotional rate). It's simply that I can't find the physical magazine or paper when I need to find it. On the other hand, I can always find the same thing online- pretty easily.

Some time ago I had asked a Wall Street Journal subscription person if I could get only the online version, no - I was told because they need to sell the paper version to show the official "circulation" numbers. I guess - this was one of the drivers that drove the Newspaper business to the ground. Every region has its beloved paper going out of business. The Rocky Mountain News is one such example, closed just short of a 150 year run. How very avoidable!

Some reports suggest that Newspapers lost out to free online advertising on Craigslist. They also suggest that a slow move to "online" editions that were free ( like New York Times - now ) is another reason. I guess Newspapers did not understand the changing business they were in. The "news" business has been changing radically with the Internet and you can choose exactly what news you want to hear,read and see. Online Ad delivery systems like Google AdWords then appear with very relevant ads when you look at a particular news item online. The advertiser does not pay unless a reader actually clicks through. Sales results for Ad spending have become increasingly important- particularly in this tight economy and here again paper editions can't compete.

Should the print media be looking at "what business are we in" ? The perennial marketing question made famous by Theodore Levitt in 1960 in the Marketing Myopia  ....

Why Search Advertising like Google AdWords should work better in tough times

In tough times like these, Ad budgets tend to get cut across  swathes of industries and company sizes. "Tough times get the tough going," is the old adage- so what can tough advertisers do?  Some money on search advertising  may be a good bet.

 As David Ogilvy said “Ninety-nine percent of advertising doesn't sell much of anything,” and Ogilvy was referring to traditional advertising like TV, print,bill boards and so on. Traditional advertising  identifies target markets  and then follows a media plan that matches media to target market. Beer ads during the Super Bowl is a good example where the target audience and product match and sales spikes occur. However, other than Super Bowl where people actually watch the ads we have TiVo, channel flipping that really diminishes "push" traditional advertising.

Things change during Internet searches, you are no longer sitting in front of the TV passively but actively looking for specific stuff. At  this point you will click through on ads that are directly relevant to whatever your search is. The technique of writing effective Internet search ads is tough business - if you want to precisely match your ad to what an individual may be looking for. Search Ads like Google AdWords , Yahoo Search Marketing or Microsoft Search advertising typically charge the advertiser when someone actually clicks the Ad.

Imagine only paying for those prospects who saw your TV or print ad !  The Internet allows two way communication and is much more effective than an expensive   1800 number on TV when you want a prospect to contact you and you want "action." In these difficult times, you need to get "action" from customers and do so with cut Ad budgets. Trying search advertising may not be a bad idea.....

In fact, my students in my B2B Class at University of New Haven  are trying just that , as part of the Google Online Marketing Challenge. Will report more on this as things develop....

Supply chain and marketing changes for a slow economy

Consumers in the US are making major changes in their behavior in the US market as the economy slows. In this article, I found the Nielsen number of store grocery brands growth vs branded products having significant implications for marketing and supply managers. Over the last year ending April store brands have grown in sales by 9.1% while branded products have grown by 3.9%. These numbers signal rather immediate actions that marketing managers and supply managers across every link of the supply chain will have to consider. Store brands have very low marketing expenses and simply launch generic products when significant local sales are observed in any branded product. Consider the OTC pharmaceutical shelves in a supermarket where the store brand for an off patent pharma product will have the same ingredients and mention "compare with X name brand" and place the store brand next to the "X" brand with off course a lower price. In good times consumers will buy branded products but these days consumers will tend to simply buy the store brand whenever possible. Brand marketers are cutting prices and offering deals to come nearer in price to the generic store brand in almost every category. These discounts coupled with cut marketing budgets is making marketing much more challenging

As demand slows down supply managers are being asked to help by trying to reduce input costs in every way possible, the market will simply not absorb costs. Innovative low cost options is something that every product category is looking for. So whether you are a marketing manager or a supply manager, you may have been already asked to cut costs and yet stay effective. If you have not been asked, don't wait for a formal mandate, get to it and just ask your customer and supplier how you can cut cost and come up with innovative solutions like combining deliveries, investigate economic inventory financing options and any way you can do more with less. And try to do these now!

Tata Nano and now Tata Jaguar and Land Rover

Tata had announced the $2500 Nano Car (left with Chairman Ratan Tata)  to much applause. There are no dearth of buyers at this price point in Asia,Eastern Europe, Africa and Latin America . But have you ever heard of a company operating at both ends of the market ? In fact, the Tata's have created the entire possibility of a $2500 car and now they are buying the Jaguar and Land Rover. The Nano is for the "Bottom of the Pyramid" while the Jaguar starting at $50,000 ( or 100 times the Nano) is for the super-rich. Are they capable of operating at both ends of the the market? Yes, I think so having worked with Tatas' as customers for several years. They are  great employers  with a  history  of  caring for employees,customers,suppliers and stakeholders far ahead of their location (India) and  times. Luckily, the Jaguar and Land Rover Union does not have to worry about jobs as this report suggests. Also, if Ford can focus on its core brands and turn things around, the auto industry will see better times.

GNHCC Business Expo 2008 with AMA-CT ,Google and Seth Godin

Last year I had spoken at the GNHCC Business Expo and the expo  was great. This year I was unable to attend but requested my Internet Marketing and E-Commerce class to attend and also help out with the AMA-CT booth. It was really nice of the students to attend the expo and also listen to the excellent  talk"Web 2.0: Trends in the Digital Landscape" by Mandy Gardiner, Team Manager Google Inc. And here are the photos.....

Clearly, the organizers of the Expo have moved into Web 2.0 marketing as they had got Seth Godin, Web 2.0 Marketing Guru to be the lunchtime speaker. Tod Kallenbach the AMA-CT President gave me Seth's new book "Meatball Sundae" and I just finished reading it. Fascinating......

Muhtar Kent at Coke and Indra Nooyi at Pepsi and the Bottom of Pyramid

Muhtar Kent is the new CEO at Coke. This blog had commented on the changes at Coke earlier this year and the elevation of Mr. Kent to CEO is indeed a great development. Not only is Muhtar Kent, of Turkish origin,  eminently qualified but his elevation signals Coke's  diversity  comeback . It also makes good business sense. Good business sense because as Fortune reports, Muhtar Kent led the Coke efforts in Eastern Europe after the Berlin Wall and should be able to lead the market expansion in emerging markets of the developing world. These markets have been called the "Bottom of Pyramid"(BoP)  and involve most of the world where per capita income is low but human aspirations are high. A person drinks soda as a special treat and serving sizes are low ( about 6 -8 fl. oz. vs. 12 fl.oz. in the US) to keep soda affordable. These markets use bottles not merely because of "green" concerns but because a large unskilled  labor pool is able to move bottles at low cost across the distribution chain. Growth for US consumer products will come from these markets and the CEO must understand how these markets actually work.

Pepsi in the meanwhile has India born Indra Nooyi at the helm and the BoP Cola wars should be interesting.

Mature Global design Strategies improve profits

I was rather happy to read the Aberdeen report's summary which highlights that global product design and development leads to reduction in product development time and time to market while allowing the protection of intellectual property through Digital Rights Management.

This blog and my research has been investigating these issues for some time and I am glad that the data is now available. The question is how do you make it work in practice, particularly if you are not a gigantic organization that can afford to open offices worldwide and actually place your person to work with the supplier in another country. That is an interesting question .....