The Classic 1-2-3: Ries Style March 20, 2006
The strategically lovely Laura Ries at her best:
Strategy is strategy. Tactics are tactics.
A strategy should never change. Tactics should be changed frequently to adopt the new ideas, new concepts, new opportunities and new media that are constantly coming into the market.
But guess what? Company after company tries to win their marketing wars by constantly changing their strategies. The latest example is General Motors.
Years ago, General Motors had a brilliant strategy. Chevrolet was the entry-level car. Pontiac was the youth-oriented car. Oldsmobile was the high-technology car. (No really, the now defunct brand was cutting edge at one time. In fact, it was the first high-volume front-wheel-drive car.) Buick was the conservative car. (Bankers drove Buicks.) And Cadillac was the high-end, expensive car.
Today, everything is a mess at General Motors. Nobody knows what the individual brands stand for.
What is GM’s entry-level car? Is it Saturn or Chevrolet?
What’s the difference between a Chevrolet, a Pontiac and a Buick? Not much since the brands share many models with the only difference being the nameplates.
In Friday’s New York Times, Ryndee Carney, GM’s manager for advertising and marketing communications said that the divisions “operate independently.”
A big mistake. Strategy should be dictated by the corporation. The divisions should only have the freedom to determine their individual tactics.
If a company wants to be successful with a multiple-brand approach, it should set rigid rules for the strategy of each brand and then let each brand manager determine the appropriate tactics to execute the strategies dictated by the company.
In many categories, a company can be successful with what we call a one-two-three approach.
1. An inexpensive brand.
2. A popular-price brand.
3. An expensive brand.
Today, Toyota is a company flying high. Toyota has built the classic 1-2-3 strategy with
1. Scion
2. Toyota
3. Lexus.
Other companies with 1-2-3 strategies:
- Busch – Budweiser – Michelob
- Old Navy – Gap – Banana Republic
Price isn’t the only way to build a unified company strategy. You can distinguish your brands using age, MTV is for hip teens, and VH1 is for hip adults (or hope they are still hip.)
You can distinguish by skills. Black & Decker is the consumer brand. DeWalt is the professional brand.
Or you could distinguish by distribution. L’eggs is the panty hose brand sold in supermarkets. Hanes is the brand sold in department stores.
If you appeal to no one, you are forced to sell your product on price. Not a very efficient or profitable way to run a business. A strong narrowly-focused brand helps to differentiate your product and makes the selling process easier. Strong brands attract consumers; weak brands need to be forced upon consumers with advertising and low prices.
Toyota is has done a brilliant job of building distinct brands. Toyota’s latest brand winner is Scion. In 2005, Scion spent the fewest in media dollars for each new vehicle sold at $284. Toyota was $422 and Lexus was $875. Compare those numbers to some of GM’s cars and you see the power of strong branding. Buick was $751, Saturn was $1012, Saab $2,116.
The introduction of Scion in 2003 has been brilliant. Toyota made great use of viral marketing and event sponsorships instead of advertising to build the brand the buzz surrounding it. Other brands have tried viral marketing, but the technique only works if you have a credible brand, a unique message and can target a narrow audience. Scion has all three and the brand completes the Toyota trifecta.
Here’s a link to the original article.
What do Gen Xers want? January 20, 2006
There is an excellent article up on CNN Money/Fortune that focuses on how companies are retaining Gen X workers. I found the article to be very interesting, and it is a great read for anyone running their own company.
As for the old-fangled idea of paying one’s dues in a dull job before moving up to something sexier, forget it: 77% of Gen Xers say they’d quit in a minute if offered "increased intellectual stimulation" at a different company. And they’re intent on managing their own time: 51% would jump ship for the chance to telecommute, and 61% of Gen X women would leave their current jobs if they were offered more flexible hours elsewhere.
What does this mean for you and your company? Do you give ample opportunities to your employees to expand their knowledge of your business? Do you have an employee suggestion box with prizes for the person who comes up with the best idea of the week/month, as voted by his or her peers? Or are your employees doing the same tasks they were assigned when you first hired them two years ago?
These are just some simple suggestions, and only the beginning of a list of options. Entrepreneurs take notice — your younger employees want to be challenged. And they aren’t willing to wait for you to get around to doing it.
Finding The Right Help January 9, 2006
Through the ventures I’ve had of my own and through the experiences of my father, I can tell you that nothing can be done alone. Nothing of GREAT proportions anyways. Sure you can start a little biz focused on your little city with little room for growth and practically do it yourself, but you can’t build the huge empire you dream about all by your lonesome. Sooner or later you’re going to need to realize that not matter how smart, how effective, or how instinctive you are, you have areas where you could improve. But do you have time in your life to become an expert on everything? If you’re like most, you don’t have that luxury. You’re going to need to hire high-quality people to fill in the gaps and grow your business with you. We call these people ‘employees’ – and good ones are hard to find. Here are a few tips to help you on your quest for good help.
Only Heavy-Hitters
Don’t waste your time with people who just have some potential. Recruit those who have proven themselves in the past. If you only fill your positions with people who have proven they can play hard and play to win, you’re chances of success are phenomenal. Donald Trump says only recruit superstars. Heed his advice (this time!).
Keep A List
Through your networking events, business dinners, or even through small talk at the supermarket, you’re going to run into your heavy-hitters. Jot down their information and keep a running list of the top 5-10 (or more, depending on your organizations needs) people that you can possibly see yourself hiring or partnering with. Cultivate these relationships. Give them the attention they need to grow into something beneficial to you and your company.
Involve Them More
If you’ve successfully recruited a heavy-hitter and bypassed the guy that’s OK with 3 hots and a cot, you better be ready to involve them in the master plan. They’re not going to settle for monetary compensation because they know they’re worth more, and that’s OK – you know they are too. Show them your business plan. Show them your marketing plan. Ask for their suggestions and let them know that innovation from within the organization is OK and in fact is encouraged. Let them know that they can be as much a part of the company as they want to be, and that there’s no ceiling. A heavy-hitter won’t stay around if you clip their wings. You have to let them be creative and involve them in the growth of the company, not just in the filing and coffee making.
Bootstrapping with Rookies
OK, OK, this is a startup article. In many cases you might not have the funds to hire a heavy-hitter with a beautiful resume and references to match. That’s OK. It’s alright to hire a ‘rookie’ just on his enthusiasm and ‘potential’. This is more risky and not a sure bet, but if you can find someone with passion and intelligence and you use your gut instinct (yes, we’re back on that again) you’ll do fine. Entrepreneur’s have a gut reaction when they recognize a new opportunity or when they meet great people. Use that reaction to make the most informed decision possible.
You must have an extraordinary team to do extraordinary things with your company. You can’t do it all, so if you’re going to share the responsibility, share it with passionate, enthusiastic, intelligent individuals that will take pride in their work and strive to do right by you.
By Eric Windsor for YGG