Marketing is a conversation (2 of 2)

As something of a counterexample, consider Vitesse Semiconductor. I was with Vitesse for a few of their rockiest years, when the company disclosed that they had been backdating employee stock options and had some past financial accounting problems regarding revenue recognition. (I left the company early this year because my job had moved to California, and I didn't want to move or commute.) This led to the company failing to file public financials for a couple of years because they needed to restate so many of their past financial reports. As a result, the company was delisted from NASDAQ and remains on the pink sheets. The former high-flyer of the late 90s, whose stock price exceeded $100, is now trading for less than $1.

Now, many companies got caught up in the options backdating scandal, and for various reasons most of these companies were not hit has hard as Vitesse. But at the end of 2007, I believed that Vitesse had survived the worst of it, that they were close to restarting public financial announcements and, most importantly, they had a strategy for growth and profitability into the future. So at that time, I bought a bunch of shares of the company at $0.84 per share.

The company finally released public financials at the end of September. Those financials showed what I had anticipated, that the company was on the road to recovery. Yet yesterday, the company's stock closed at $0.18. Even if we consider that the broader market is down say 50% in the last couple of months, that might mean the company would otherwise trade at $0.36.

What's happening? More importantly, where's it all going?

That's exactly the problem, there's no real way to know. The company website only has product releases and announcements of upcoming investor presentations, and not very many of either of those. Yet I suspect lots of things are going on within the company that people would like to hear about. Where's the forum for sharing or discussing that information?

Well, there's always the finance discussion boards, like this one on Yahoo Finance. But these finance boards are just full of people shouting epithets at each other, or pumping the stock. That's not what I'm talking about.

I'm not even talking about financial information, necessarily, but product information, technology and market discussions, application stories, or the company's view of the world. What did they learn at their last trade show? What does the company want to be when it grows beyond this current financial mess? That's all opaque to an outsider.

In that thundering silence, the stock continues to plummet.

There are lots of technical tools available, including blogs, forums, or podcasts. Why doesn't CEO Chris Gardner podcast? Or Tony Conoscenti, VP Product Marketing, Martin Nuss, VP Technology and Strategy, or CFO Rich Yonker? A biweekly podcast would be a great way to demonstrate leadership and reengage with customers and investors.

Vitesse used to be a dominant leader in their space and still has some strong capabilities. By improving their external communications, they could begin to reestablish thought leadership.

There are several marketing agencies helping companies like Vitesse to redefine external communications beyond traditional PR or, more broadly, to establish communities. One local one is Room 214, who appear to be doing some pretty cool community things. How do I know? I don't for sure, but that's the feeling I get from their blog.

Because they're communicating ...

Marketing is a conversation (1 of 2)

I had lunch with a marketing colleague the other day. He mentioned a saying that he's fond of: "Marketing is a campaign, not an event." I agree with that, and would an another: "Marketing is a conversation, not a proclamation."

In a prior post, I mentioned that "My marketing focus was:

1. Understand customer needs and define the appropriate product or service to meet those needs
   
2. Use the appropriate promotional tools to drive revenue growth for those products and services"

If you consider those two points together, understanding customer needs, then promoting, that's bilateral communication or, in essence, a conversation.

More broadly, there are many situations where companies need to have conversations with their customers and other constituents.

For example, SharedPlan had some pretty strong views regarding the collaborative aspects of project planning and management. To help us voice those views, we started a newsletter, quickly growing the readership to about 20,000. At the same time, we provided users a voice by establishing a forum and by providing a repository where users could share project plans. Again, bilateral communication .. a conversation.

At Albeo, we began a similar process. In the lighting market, LEDs represent a completely new model for lighting (with regard to economics, lifetime, light dispersion, light quality, energy use, size, heat, replaceability, you name it). The differences are so dramatic that we couldn't even begin 'selling' until we provided some fundamental education to our customers to enable them to interpret our selling statements. So we started the Albeo LED Academy, an educational resource to provide those basics. The plan was to develop the Academy into a series of webinars or live events that would then enable us to build a user community. That user community would then serve to give our customers a voice to begin a broader conversation. We had some visionary ideas about where LED lighting could go, but until we could hear the collective voice of our customers, we couldn't validate those ideas.

Both of these companies benefited from conversations with their customers and constituents. In the second post on this topic, I'll provide something of a counterexample, a company that could benefit from conversations, but does not seem to recognize or enable that.

Robo-calling rich folks with investment advice?

"Hi, I'm Jim Coleman, and my records indicate you're a qualified investor. If you are a qualified investor, please press 1 ..."

That's the robocall I received on a Thursday morning at 8:30 am. I was getting ready to leave for work and I hung up at "press 1." But then, as I frequently do, I starting thinking about the marketing tactics being employed here.

According to this site, qualified investors are "individuals, trust accounts or institutional funds with at least $5 million in assets to invest." Therein lies my whole problem with this campaign.

I thought to myself that if I'm worth $5 million, do you suppose I got where I did by answering unsolicited robocalls for investment advice? Presumably, I'm either knowledgeable enough to invest on my own, or smart enough to have a real adviser, one that I found through referral or some other more reliable means, not via robocall.

Also, why would they call at 8:30 am when the qualified investor has either left for work or about to do so? Do qualified investors not work? Maybe they're targeting super-qualified investors who don't go to work anymore. But then, that takes me back to my first point: super-qualified investors are even less likely to respond to robocalls from Jim.

That's when it dawned on me. By asking if the call recipient is qualified, then maybe they're trying to target non-qualified suckers who want to become qualified.

It's kind of like Club 33. About 10 years ago, my company had one of the few corporate memberships to Club 33 at Disneyland, and I took my family there several times. The entrance to the club was an understated door with a 33 on it on one of the main thoroughfares through the New Orleans section. To get in, you rang the bell and the host would ask you to identify yourself, then buzz you in.

The sight of my family ringing that doorbell, being identified, then buzzed in, captivated all those around us. A glance back as we walked in showed faces with a range of emotions from curiousity to envy. People wanted to be part of the club because it was exclusive. They had no idea what was in there, they just knew that they weren't in there.

Non-qualified investors want to be qualified, even if they don't know what qualified is. So they "press 1." That's the only thing I can conclude about that campaign. Maybe next time, I'll take the time to press 1 to learn more.

HM has died, but he left an amazing legacy

I heard on NPR that HM (Henry Molaison) died recently. I had never heard of HM before this story, so I read the Wikipedia entry. What a truly fascinating and tragic story. (His story was apparently the inspiration for the movie Memento, although I doubt there was any killing involved with Henry.)

I can't get the story out of my head, how he went in for brain surgery at age 27 to correct an epileptic seizure problem, and was so irreparably harmed that he was institutionalized the rest of his life. Yet if you spoke with him, he would seem completely normal. His speech was normal, and he could remember things from before the surgery, but nothing from after. He could learn new motor skills, but not remember how or when he learned them. He couldn't remember what he had for breakfast that day, or what he did yesterday, or anything from after the surgery. The oddities go on and on ...

One of the people featured on the NPR story is writing a book on HM, who contributed an immeasurable amount to our understanding of the brain. It's incredibly sad though, the price that he paid to provide us that understanding.

I'm all about revenue growth

Yesterday, I heard a radio commercial (yes, I admit it again, it was on sports talk radio) for the Chevy Volt. I was only half listening to it, but it caught my attention when it said something about "those guys that were so good at chemistry are now working on the batteries for it." It then went on to say that the Volt will come out in the 2010 model year.

I realized that I was listening to an ad for a car that won't be available for a year! This ad is from the same car company that just went before Congress and stated that they won't make it to the end of 2009 without a congressional bailout. So, my first thought in hearing this ad was "shouldn't they be trying to sell the cars they have, rather than cars they don't?"

Then I thought, "maybe they're trying to revise their brand from 'uninteresting, middle-of-the-road cars for the masses' to 'leader in clean automotive technologies.'"

But this post is actually not about GM's advertising, it's about branding. As in, I'm not a branding guy.

That ad made me realize that, for more than a decade, I have been a marketer focused on revenue growth, rather than branding. My marketing focus was:

1. Understand customer needs and define the appropriate product or service to meet those needs
   
2. Use the appropriate promotional tools to drive revenue growth for those products and services
   

There's nothing in those two items about establishing and building brands. That's because many of the companies I worked for were small, even startup, companies where revenue was King. (Actually, cash was King, but revenue was a very close second, probably Queen.) We didn't have the luxury to invest in establishing a brand.

It's not that I don't appreciate the value of branding and would enjoy the opportunity to establish and build a brand. In fact, if you read several of my past posts on advertising, I am frequently referring to branding. Examples include my recent posts on a couple of radio ads, one discussing Microsoft's new I'm a PC campaign, or the one discussing La Quinta (whose brand apparently is 'hotels for idiots.')

I would love to do some branding work, but at the end of the day I'm a revenue growth marketer.

Love those Discovery Channel shows

A 24-hour bug has been working its way through our house, so last weekend we found ourselves on the couch watching TV. We ended up watching Discovery channel all day. We were already fans of Mythbusters (which we have TiVo'ed for some time now) and Dirty Jobs. On Saturday, we also discovered Time Warp, How Stuff Works, and Prototype This!.

We (the boys and I .. I'm not sure I can include Gina) love these shows! We are clearly in the channel's demographic. Big Science Saturday has pretty much stopped since we started working on Destination ImagiNation this season, so maybe Discovery Channel will replace BSS.

TV can be just as stimulating and educational as science experiments, right?

Another good BSS event

It's not quite NCAR's Super Science Saturday, but there's another fun Big Science Saturday event coming up.

Each fall and spring, the first-year engineering students at CU host a Design Expo to show off their design projects. The projects are judged by working engineers from various companies around the area. For three hours during the day, though, the Expo is open to the public and the public can vote on their favorite project to win the People's Choice Award.

You can find more information on CU's Integrated Teaching and Learning Program website. It's another good opportunity for me to expose the boys to science and engineering in action.

We'll see you there!