Category Archives: Advertising

Who, What, When, Where and How: the four Ws and H every company needs to cover while developing the marketing plan for a product.

You might have the best software solution for customer relationship management in the world, or for that matter the best baby soap, but till your customer knows it, and believes in it, it’s of no use.

No matter how big or small your marketing budget is, if you are not targeting the right audience with the right message, at the right time and the right place, using the right medium, it is of no use. In the next few posts I will share some thoughts to explore each one of these rights.

If we were playing Jeopardy, the right answer would have been: “What is branding?”

Beijing Olympics 2008 is one of the classical examples of branding at a global scale from the recent times. China spent north of $40 billion to link the idea of progressiveness and development to the country. The infrastructure improvements, the pollution control, the massive ceremonies and the security arrangements apart from a list of other things linked the idea of progressiveness and development to the product known as China.

Similarly, when a company tries to brand a product like face cream, they link the idea of beauty to the product. That sense of beauty is exposed in every bit of the product right from the formula that’s used to develop it to its packaging to the advertisements of the product. Everything together tries to deliver the same message to convince the customers.  

Whether you are branding the most populous country in the world or a face cream or just water, it sums up to the simple process of linking ideas to product (or service). The logo, advertisements and customer service, all have their own roles to play when it comes to branding.

I believe there are two main purposes of branding. First is creating trustworthiness. Trust plays a major role in any decision a customer is making and that is one of the big goals behind branding. The second purpose behind branding is to create a community to back your product. Ideas are not attached by marketers alone, they are attached by consumers as well. And when consumers attach an idea with your product, it speaks much louder than you doing the same. So the goal here is to provide enough buzz and space for the mavens to pick up your product and take it from there to create more trust in the community and build your brand equity.

The basic idea behind any marketing or advertising effort is to create a connection with the customers. The success of your campaign depends on how well a customer can identify with your product. And when it comes to identifying with a product, connection at a regional level plays a very important role. You can define a region at any level, it can be a country, a state and in some cases, even cities.

Let’s talk about going local in a country. In the world today, you got to consider the global marketplace which is full of diversity. In order to link to their customers in this diverse global market, companies try to adapt their stories to make it compelling for the people in a particular geography. Consider India as an example. In India, there are many global brands which are so well connected to the local community that people end up thinking them to be local brands. Vicks (Procter & Gamble), Maggie noodles (Nestle), Bata footwear, Cadbury Dairy Milk (CadburySchweppes), Lifebuoy soaps (Unilever) and many others fall in this category. The reason being the way these brands have established connection with the people in the country. The product itself is localized in many cases, followed by localized advertisements, packaging, slogans and what not.

But this concept of going local is not limited at the country level. In many states, companies use local branding strategies to connect with the customers. For example, while Ford slogan in most parts of USA is “Ford Built Tough”, in Texas the company goes local with its campaign slogan: “Ford is the best in Texas”. The goal is again very simple: connect with the customers in Texas, and if it can be done better with a local slogan, let’s use that.

I believe when a brand goes for local connection, it generates a much higher level of trustworthiness with the customers. It makes the customers feel important and increases their loyalty towards the brand, in-turn making the local connection work.

Reason a customer pays for a product or service offered by a company is in most cases the source of revenue for the company. But then there are cases when this is not true. The reason a customer pays is one thing, which in most cases is the primary offering, but a completely different secondary or additional offering generates more revenue for the company. These are the cases when the reason and source of revenue are different, though mostly interdependent.

One of the most talked about examples in this case is Hertz rental car service. The biggest source of revenue here is the rental insurance that Hertz provide with its cars which is an additional and optional service the company provides when you rent a car from them (just for kicks, the second biggest source of revenue: used car sale). Another example to consider is the wholesale retail chain that loves to play the membership fee ballgame. Customers go to Costco because they like to buy stuff in large packs at a wholesale price. But Costco makes 70% of its operating income through the upfront membership customers pay for to get in the store. Similarly, consider Google. Customers go to Google primarily to search something on the Internet. Their main source of revenue: advertisements, the contextual offerings next to the search results customers are looking for.

It’s interesting to see an auto rental company, a wholesale store, and a search engine, each excelling in the core area of their business but making the biggest chunk of revenue from a secondary offering. The important thing here is to notice their focal point of operations. Hertz cannot shift its focal point from rental car business and generate the same revenue through insurance. They are able to generate rental insurance revenue because customers like their rental car service and buy insurance for the cars they rent. Similarly, Costco cannot sell memberships if the customers don’t find what they want from the stores and Google cannot generate ad revenue if the search results are not relevant enough for customers to keep using it.

This brings us to the real thing…the success mantra to keep the cash register ringing is: focus on the reason and embrace the source. When the source and reason are the same, its a smoother ride, but when they are different, you got to make sure that you provide great reason to your customers to come to you along with maintaining attractive revenue generating additional offerings.

Global advertising is a more than $600 billion industry that is growing year-over-year. This endorses the fact that in today’s competitive environment, the value of customer connection is more than ever before. Companies go to great lengths to make sure they connect with their customers, be it using old mediums like television and newspapers or new mediums like blogs and newsgroups. Television, radio, newspapers and other mediums sell their ad spaces based on how many people will watch that particular advertisement, and most of the time, more the eyeballs, more expensive is the advertisement space.

But does it really matter how many people watch your advertisement? Of course it does, if you are selling bottled water, because that’s one of the few cases where all the people watching the advertisement are your customers. But in nine out of ten cases, the marketers need to target the niche. In that case, it doesn’t matter how many people watch the advertisement, what matters is how many potential customers are watching it. The success of web search powered advertisements is a testament of the importance of relevance. If the advertisement reaches the right customer at the right time, it can have a real impact on the sales of the company.

To sum up, it doesn’t matter if your advertisement reach out to a million people if your potential customers in that million is a hundred. A much better strategy will be to first identify those hundred customers using customer intelligence and then tailor your campaign to reach those hundred customers with a clear and focused message. It’s the who that matter, not the how many.