Negative Cost Selling/Guerrilla Marketing/Social Marketing
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Transcript of Negative Cost Selling/Guerrilla Marketing/Social Marketing
Negative Cost Selling/Guerrilla Marketing/Social MarketingPresented by Professor Bruce M.
Firestone Founder, Ottawa Senators, Executive
Director, Exploriem.org, Entrepreneurship Ambassador, Telfer School of Management, Broker, Century 21 Explorer Realty Inc.
B. Eng. (Civil) [McGill], M. Eng-Sci. [UNSW], PhD. [ANU]
Contents
Do you want to learn how to really make people want to buy from you?
Are you in the solution selling business? Do you know how to get on the ‘same side of the
table’ as your customers and clients? Do you want to learn negative cost selling? Do you know how to think in terms of 2-D and 3-
D business models so that you can not only take care of your clients but your clients’ clients too?
Want to understand Guerrilla Marketing and Social Marketing?
The Power of the Brand
“People like to buy from people they like and trust,” Prof Bruce, Ottawa, Canada
“Have you ever bought anything from someone you didn’t like or trust?”
Trust (not love!) is the no. 1 thing in life and business
Marketing Builds Brand Builds Trust Creates Opportunity to Sell
The Power of the Brand
Mutual Life Assurance Co. of Canada Clarica Life Insurance Co.
New sell-line: "Clarity through dialogue“Funny TV ads– Clarica Agent appears on
scene to clear up W/C ambiguityNo call to actionHow many people head for the phone to
buy some insurance?
The Power of the Brand
None! Separate selling process“VP, Marketing and Sales” Doesn’t
know what he/she is doingLiving room pitch: “Take care of your kids!”“Where’re you from again?“Pirate Insurance Company of Kinakuta” or
“Clarica”– which helps you to close the deal?
The Process
(2)Your
Reputation and Brand
build Trust in you
(3)Trust in you creates an
opportunity for you to Sell in a separate
Sales Process
‘TRUST POWERS SALES’
(1)Marketing through a Marketing
Process builds your Reputation and Brand
Ethics
Probably < 1,500 key entrepreneurs in a place like Ottawa
Even NYC < 5,500Protect your reputationMajor Arch firm bids on Urban Design of
new Ottawa Congress Centre with our group
Jumps to winning bidder/takes IP w/out permission
Ethics
Their name is … DIRTNo longer active to any great degree in
OttawaWhat should they have done?Ask for permission and ask winning bidder
to compensate group for their IP– would not even have had to pay it themselves!
‘Intricate’ Your Clients
The late Elliot Richardson, former Attorney General of the United States
US Counsel to BRING BACK THE SENATORS
“Bruce, first we’ll intricate the NHL. Then we’ll get the franchise.”
(To honour Elliot, UrbanDictionary.com: http://www.urbandictionary.com/define.php?term=intricate+)
‘Intricate’ Your Clients
“To bring people on board or to get them onside with an idea or a proposal or an initiative of some type by getting them 'intricated' into the process bit by bit, almost without their noticing that they are making a commitment.”
‘Intricate’ Your Clients
How do you do this? Become an indispensable part of your clients’
business ecosystems/if you know your client’s History, you can become indispensable/hard to replace
How not to do it? E.g., typical Ottawa law firm:
Don’t keep clients’ clients tel. #s, email addresses on file Lose client e-documents Don’t know their r.e. client’s Banker, Surveyor, Environmental
Consultant, Insurance Broker, Title Insurer, Mortgage Broker, Appraiser or other suppliers
Wait to be told what to do
Firestone’s Three Laws of Power SellingLaw No. 1: SITTING ON THE SAME
SIDE OF THE TABLE
Law No. 2: SOLUTION SELLING
Law No. 3: NEGATIVE COST SELLING
SITTING ON THE SAME SIDE OF THE TABLE
GradeATechs.comAlt. 1: “We can sell you XYZ virus scan
software from Acme Corp. for 200 bucks. What do you think?”
Alt. 2: “We can get you XYZ from Acme for $200 or MNO from Beta for $150. If you don’t like either, we can get more quotes for you.”
SITTING ON THE SAME SIDE OF THE TABLE
In Alt. 2, GradeA becomes: ‘trusted advisor’
Sits on same side of table as clientXYZ and MNO (+ all other suppliers) are
on the other sideGradeA has changed the equation!
SELLING TO A CLIENT HELPING A CLIENT BUY!
SOLUTION SELLING
In r.e., buying a lot is a problemBuying a home is a solutionNew sub-division with 21 lots to sell
($125,000+) for client in KanataWhat to do?Make a deal with top quality home builder
to offer his homes w/ lots
SOLUTION SELLING
How to sell this to builder? Intricate him!Offer him 6 lots for $500 each!$500 each?Yes!
SOLUTION SELLING
That’s $500 for an 18-month option on those lots
Only pays for lots when sold to Homeowner
Co-brand sub-division with Builder– piggy back on his marketing
SELL SELL SELL
SOLUTION SELLING
Know your client’s History and Biz Ecosystem
Hard to sell a solution when you don’t understand the problem
Ace Promotions– problem wanted to sell Golf Pros promo products
Issue?Most golf pros don’t have much spare
cash
SOLUTION SELLING
But they have something of great value– a client list
Accounting firms and legal firms would like to get access to those clients
Eureka! Golf Pros have lots of time and no moneyAccounting and law firms have lots of
money but no money
SOLUTION SELLING
Let’s solve all three problems (money, time and client access) together
By helping 10 Golf Pros buy 1,000 mouse pads each at $5.00 per item
That’s a $50,000 order for Ace PromotionsEach mouse pad is co-branded: golf pro w/
accounting or law firmLatter put up the dough/former becomes
distribution channel (gives them to each golfer)
MORE SOLUTION SELLING
Ace is also trying to break into the auto dealership biz– SELL SELL SELL
Tom Smith Toyota is looking for more car buyers!
Ace must solve the problem: “How do you give out promo products to people who are not yet your customer?”
Ace comes up with new distribution channel for Smith Toyota!
MORE SOLUTION SELLING
The humble ice scraper– solves allAce sells 10,000 ice scrapers to Smith
Toyota at $4.00 eachSmith Toyota also pays Ace $6,000.00 to
hire wage slaves (aka students) to go to co-operating: gas stations collision repair places car washes and give them out for free!
MORE SOLUTION SELLING
Non-traditional outlets!They get the scrapers for free Can use them in their own promotional
efforts too– “Fill up here and get a free ice scraper.”
Car owners who frequent collision repair shops might need a new car some day (soon)
MORE SOLUTION SELLING
The ice scraper also communicates!“Bring this ice scraper with you to Smith
Toyota < June 30th and we’ll pay you $250.00 to test drive one of our cars!”
Take solution selling one step further– provide your clients with ROI data
By investing (!) in your products or services (the ice scraper), they increase their revenues/lower costs or do both
NEGATIVE COST SELLING
More from UrbanDictionary.com (http://www.urbandictionary.com/define.php?term=negative+cost)
“Negative cost selling is all about understanding your client’s business from their point of view and being able to measure the benefits you create and the cost reductions you cause.”
NEGATIVE COST SELLING
Anthony owns (snail) mail order houseKnows that CPC/USPS now allow lumpy mail
campaignsVisits with local children’s charityWants to sell them on 3-year campaign at
$15,000 per yearHis pitch? Solve their problems:
How to get folks to open their snail mail? What’s the distribution channel? What’s the ROI?
NEGATIVE COST SELLING
Includes flat (stone skipping) rocks with each letter
Sends letters to 800 (local) CEOs/Biz Owners
His firm has the names/contact infoEach letter challenges the CEOs (v.
competitive people) to rock skipping contest at Children’s Camp
NEGATIVE COST SELLING
94% open the envelopes> 50% commit to attending themselves or
sending a rep> 400 attend at $750 each3-year commitmentCan buy extra rocks @$100/throw!Raise > $40,000/yearPlus CEOs on-site see the kids and
become sponsors…and fix stuff
NEGATIVE COST SELLING
$15,000 investment $40,000+ = ROIMulti-year commitments recurring
revenue + create opportunity to not be a MLB-type player where every year you start with 000 home runs
YOU CAN NOT BUILD A SUCCESSFUL SALES PRACTICE IF YOU HAVE ALL 1-YEAR CONTRACTS
NEGATIVE COST SELLING
$15,000 investment $40,000+ = ROI
Anthony’s pitch:
“I’ll pay you $25,000.00 per year to hire me!”
NEGATIVE COST SELLING
Peter Patafie built Patafie’s Moving Supplies Inc. into $16 million/yr operation w/ one crucial sales innovation
His pitch: every moving co. would buy (cardboard boxes, wardrobe boxes, bubble wrap, tape, tape dispensers, wrapping paper) from Patafie’s
But instead of delivering them to the moving co., would deliver them to their clients instead
NEGATIVE COST SELLING
Saves moving co. warehouse space Increases moving co. revenues because their
salespeople now have more time to sell moves rather than redeliver packing supplies to their clients
Got 97% market share (more than Microsoft)
NEGATIVE COST SELLING
Peter understood his client’s ecosystem– including the needs of his clients’ clients (2-D Biz Modeling)
Sits on same side of the table as his customer (his customer’s customer becomes his customer– e.g., Peter sells them refurbished boxes and buys them back > move)
Uses ‘solution selling’ (by making his customer’s salespeople more productive)
Sells based on negative cost (since his customer’s customers are paying for the packing and moving supplies and ROI to moving co. ~ infinite!)
Jeff Hunt and the Ottawa 67s
New way of responding to the 500+ charity and community requests
$600 needed for minor hockey tournament Give $600 x $500 or $300,000/yr.?Not affordable for Junior TeamLet them buy 120 game tickets at around
$5 each that they resell for, say, $10
Jeff Hunt and the Ottawa 67s
Cost to 67s? -$600Cost to minor hockey team? -$600Developed new distribution channel: 500
charity requests 60,000 tickets sold/yr. raised $300,000 for 67s raised another $300,000 for charities
“Give a person a fishing rod, not a fish,” Anon.
More from Jeff Hunt and the Ottawa 67s
Cost for naming rights for the Civic Centre $30,000
No takersInstead sold 30 companies @ $1,000 eachDraw winner: Civic Centre Urbandale
Centre for 1-yr termCost of Naming Rights for Urbandale?
-$29,000 -$550,000 (value of PR/earned media) = -$579,000
Satellite Tracking Service
Sell Personal Tracking Devices (PTD) for executives visiting high risk countries
Not much bigger than cell phone Reduces cost of insurance Reduces frequency and cost of lawsuits—duty of
care Reduces losses from kidnapping, injury or death Reduces lost productivity from above and impact
on morale Can demonstrate very high ROI
Crowd Wave Games
In-arena cameras, gesture control and vector aggregation software
~ 7th Inning Stretch with ‘brains’Cleveland Cavaliers– launch client‘Intricates’ sponsors– Section 315 plays
against Section 112 Winners get (say) $10 Verizon Calling
card
Crowd Wave Games
Crowd Wave Games
Reduce sponsor exodusBring new sponsorship dollarsIncrease game-day ticket sales and
reduce season ticket churnCWG demos very high ROI for CavsImprove in-arena experience for
fans/create team play feelings for average citizen/not available at home
Yoga and Injury Reduction in the NHL Heather Moore, at Mountain Goat Yoga Centre in
Kanata More core strength, more flexibility, greater agility, better
balance, faster healing and lower stress levels Perfect fit for NHL Players Heather’s Yoga Fees: $7,267.86 for the season Savings to Team from Reduction in Injury: $352,201.28 Increase in Revenue due to Increase in Regular Season
Attendance: $523,939 Net Revenue from Extra Home Playoff Game(s):
$1,020,000
Yoga and Injury Reduction in the NHL For an investment of just under $7,300, the team receives ~
$1.9 million in cost decreases and revenues increases
IRRYear (2006_2007)0 $(7,267.86)1 $1,896,140.67
IRR 25989% per annum
Value of going to Stanley Cup Finals: priceless “Heather will pay the Sens ~ $1.89 million to hire her!”
Doug Cardinal and the Museum of Civilization
Architects can’t use –ve cost selling, can they?
Yes, they canDoug Cardinal believes in the sanctity of
the client or ‘patron’Former PM Pierre Trudeau was Doug’s
patronPublic Works nixed curvilinear walls for the
new museum– too costly and too risky
Doug Cardinal and the Museum of Civilization
Doug asked the PM: “Do you want a treasure or another blah, boxy building for Ottawa?”
But he also understood NCS, thus:“If we build it my way, it’ll cost $20 million
more but it will attract 400,000 more visits per year at $10 per head. That’s $4 million/yr. With a cap rate of 8%, this increases value by $50 million. So the cost of a legacy project for you, Pierre, will be a negative $30 million.”
Doug Cardinal and the Museum of Civilization
The HR Recruiter Previous approach to selling? Beauty contest! Value Proposition = NCS Cost of Service = $30,000 Savings in Management Time = $10,150 x 2 (they
have to replace their candidate more frequently) Additional productivity (from superior candidate +
he/she remains on the job longer) = $200,000 x 2 Cost of HR Services = -$390,300
The HR Recruiter Previous approach to selling? Beauty contest! Value Proposition = NCS Cost of Service = $30,000 Savings in Management Time = $10,150 x 2 (they
have to replace their candidate more frequently) Additional productivity (from superior candidate +
he/she remains on the job longer) = $200,000 x 2 Cost of HR Services = -$390,300
The HR Recruiter
GradeATechs.com Value Proposition = NCS Unplug Tower/Take to Computer Store: $19 of
your time Quote = Wait one week: $500 Lost Productivity Cost of Repair: $200 Call Grade A: $5 of your time Response time = 24 hours: $100 Lost Productivity Cost of Repair: $125 Cost of Grade A = -$492 IRR = 43% per day
GradeATechs.com IRR = 43% per dayTime (Day) Cashflow0 -227 (cost of GAT repair + lost productivity + call to GAT)
1 100 (lost productivity)2 100 (lost productivity)3 100 (lost productivity)4 100 (lost productivity)5 300 (lost productivity + repair bill)
Solve (by iteration):
-227 + 100/(1+irr)**1 + 100/(1+irr)**2 + 100/(1+irr)**3 + 100/(1+irr)**4 + 300/(1+irr)**5 = 0
GradeATechs.com
Residential Realtor Value Proposition = NCS FSBO sale takes longer FSBO sells at lower price– listing becomes ‘tired’ FSBO pays commission anyway– to Buyer
Agent FSBO pays commission ‘thrice’– once to Buyer
Agent + lower sale price (Buyer reduces offer price since “there is no commission”) + they do all the showings/work
FSBO higher legal cost and risk of litigation
Residential Realtor “The Lawyer who represents himself has a fool for a
client,” Anon. Agent: does 100s of transactions/FSBO: 1 or 2 For a home with a FMV of $315,000:
For a commission of $15,340 paid to Brokerage, Homeowner receives $38,188. Cost to hire Agent? -$22,754IRR? Infinite since Agent is not paid until and unless deal completes!
(See: http://www.ottawarealestatenews.com/ValuePropositionFSBOVersusAgency.xls)
1964 Tribute Band
1964 Tribute Band
Guerrilla Mktg: “Turn on your phones. Call a friend and let them listen to our next tune.”
Percentage of Audience who did: 25% New people turned on: 225 Number of shows: 140 per annum New people turned on: 31,500 per annum Cost of directly reaching 31,500 potential new
customers—a negative $6 million, since people pay them to show up!
Pool.com SnapNames.com recognized leader in backordering
deleting domain names Clients were paying $60 USD for each backorder to
SnapNames.com Register any domain name for backorder on Pool.com
for free Only pay Pool.com if successful Hundreds of 1,000s migrate to Pool.com Pool.com successfully gets > 3,000 deleted names/day
from Verisign Registry At $60/name + 2-yr registration fee = tens of millions
annually for Pool.com
Pool.com
Cost to clients? Negative again!E.g., patent and TM law firmSay, registering 40 names for
backordering SnapNames.com: $2,400Pool.com: $0Cost = -$2,400 for backorder
Pro Sports Teams
Pitching to: a Mortgage Broker “Invest in our Season Tickets, please!” “Why?” “Look at our great players!” “How about our beautiful building!” “Did you know you can escape our parking lot in
just 25 minutes!” “What a great logo we have and our
merchandise, my, my!” IT’S A BEAUTY CONTEST!
Pro Sports Teams
“If you don’t buy a ticket, the team will move!”
“What kind of a person are you, don’t you have any civic pride?”
INSTEAD USE –VE COST SELLING! By giving two Sens tickets to every
Homeowner who sources their mortgage through you, you generate 2 to 5 more mortgages per season!
Pro Sports Teams
Here’s how it works: The cost for two tickets to every regular
season home game: $55 less a 15% discount 2-year commitment Divert 40% of current marketing budget to
Sens Plus add another $2,655 The good news: other clients in this industry
are finding that they are generating 2 to 5 or more mortgages per annum
Pro Sports TeamsFor an additional investment of $2,655 in
each of the next two years, make an additional $6,695 per year or a total of $13,385
ROI of 152% per annum Cost to buy Sens tickets: negative $8,076.70 Plus Mortgage Broker’s sales now >
Mortgage Alliance minimum to qualify for volume bonuses from. ROI increases further
Pro Sports TeamsPlus Mortgage Broker’s sales now >
Mortgage Alliance minimum to qualify for volume bonuses from. ROI increases further
How about that?“Just initial here, here and here, sign and
date there. Thanks, Bye now.”
KNOW YOUR CLIENTS BIZ ALMOST AS WELL AS THEY DO
Conclusion on NCS
NCS success rate will move from .200 to .300 or .400 or higher
Plus order size and speed to order will increase triple whammy (batting average/mass/velocity) to the bottom line
Removes the fear about selling– you know your clients’ businesses almost as well as they do
Conclusion on NCS
Your projects get green lightedSelf-actualized human beings
working on projects they initiated with innovations they introduced and products and services that they fearlessly sell, are happier people!
Negative Cost Selling: Blue Heron Storage Corp– Assignment Introduction
Kirk Douglas in a 1951 Billy Wilder film, Ace in the Hole, was a washed-up, broke, former NYC newspaper reporter who happened one day to be ‘marooned’ in Albuquerque, New Mexico.
He walks into the office of the local newspaper and tries to get an interview with the Publisher and Owner. He says to the receptionist: “Tell him I can help him make 200 bucks a week.” Intrigued, the Publisher agrees to see Kirk. Douglas immediately starts to sell himself and, finally, the Publisher asks him: “What about that $200?”
Douglas replies: “I am a $250 a week NYC reporter but you can have me for 50 bucks!” He gets the JOB at $60 a week.
Negative Cost Selling: Blue Heron Storage Corp– Assignment Introduction (Cont’d)
If you want to be able to sell your product or service, you can learn a lot from this type of negative cost selling is all about understanding your client’s or customer’s business almost as well as he or she does. You have to be able to show the client that by using your product or service they will either reduce costs or increase revenues or some combination of the two by more than the cost of your product or service.
Here is a simple case study for a local Ottawa storage company.
Negative Cost Selling: Blue Heron Storage Corp– Assignment
This case study demonstrates how Facilities Managers can make better use of expensive office space by using Blue Heron Storage Corp.
Step # 1Identify how much of your existing space is (inefficiently) used to store files, obsolete furniture, old office equipment and other little used materials. For this example, let us assume you found 8,100 square feet of 'stuff' scattered about your offices.
Step # 2Determine how many engineers and other personnel can be accommodated in that space. In this example, we will assume 180 s.f. per employee (gross) which means if we get rid of the stuff that is taking up needless room in our office building, we can accommodate an additional total of 45 engineers.
Negative Cost Selling: Blue Heron Storage Corp– Assignment
Step # 3Determine the marginal cost of new space as if you had to go out and find it on the open market. In west-end Ottawa, Ontario lease rates in 2010 are in the order of $16 per s.f. per annum net, net, net plus operating costs and municipal taxes and utilities of about $15 per s.f. per annum for a total of $31. Thus, the cost of new space (your opportunity cost, if you will) is 8,100 s.f. x $31 per s.f. per year or $____________ per annum. (It's as if you had to build or buy or lease new space on the open market today.)
Step # 4Stack your materials efficiently with Blue Heron Storage (and get rid of things you don’t really need) so that you free up 8,100 sq. ft. in your existing building and take the minimum amount of storage space.
Negative Cost Selling: Blue Heron Storage Corp– Assignment
Step # 5Because you are efficient, you find that only need to lease three storage buildings, each 2,000 s.f., from Blue Heron Storage. Blue Heron agrees to lease those storage buildings to you for $12 per s.f. per annum gross.
Step # 6Count your savings! Instead of opportunity costs for new facilities of $____________ per year, you only pay $____________ per year to Blue Heron. You save $____________ for every 45 engineers and every 8,000 s.f. you free up. And you don't have to build, move to or occupy new space.
Negative Cost Selling: Blue Heron Storage Corp– Assignment Step # 7
The cost to move one engineer into a new space is $900 per person. This covers the cost of actually physically moving of files, desks, PCs, etc. plus the cost of reestablishing the computer network and phones. In addition, no matter how good your movers are, your employees will lose 40% of their productivity the week before and 1/3 the week after the move. Each employee is paid and costs the company $1,500 per week including overhead costs and benefits.
Negative Cost Selling: Blue Heron Storage Corp– Assignment Step # 8
You also know that your company has gross margins of 55% so you are losing output as well.
Step # 9
Calculate the negative cost of renting three storage sheds from Blue Heron by not having to find an additional 8,100 s.f. for 45 engineers.
Negative Cost Selling: Blue Heron Storage Corp– Assignment
Step # 10
Help your clients make room for live engineers not dead storage!
Answer: $____________
Professor Bruce M. Firestone
Fundamentals of MarketingFundamentals of Marketing
ConsiderationsConsiderations
How much is this worth?
Professor Bruce M. Firestone
1. Business Case Reviews2. Marketing’s Fundamental Role 3. The Importance of the 4 Ps4. Key Learnings5. Q&A / Discussion
Professor Bruce M. Firestone
What we will Discuss
Sports Marketing – What We SeeSports Marketing – What We See
Professor Bruce M. Firestone
Definition:
“ The process of designing and implementing activities for the production, pricing,
promotion and distribution of a sport product to satisfy the needs or desires of consumers and to
achieve the company’s goals”
Professor Bruce M. Firestone
Increase brand awareness Establish brand image and trust
Stimulate demand
Educate consumers Create distribution channels
…
Professor Bruce M. Firestone
Marketing Goals
UNAWARENESS
AWARENESS
KNOWLEDGE
LIKING
PREFERENCE
CONVICTION
ACTION
Hierarchy of EffectsHierarchy of EffectsC
on
sum
er
eng
agem
en
t
Professor Bruce M. Firestone
Marketing’s Ultimate RoleMarketing’s Ultimate Role
Professor Bruce M. Firestone
PRODUCT
PRICE
PROMOTION
PLACE (Distribution)
Professor Bruce M. Firestone
Case Reviews
Professor Bruce M. Firestone
EventEvent
Sports ProductSports Product
PersonalityPersonality
Professor Bruce M. Firestone
Ottawa Race WeekendOttawa Race Weekend
Professor Bruce M. Firestone
Facts & Figures
• established in 1975
• 146 participants
• Not-for-profit corporation run by volunteer Board
Professor Bruce M. Firestone
Competitive Landscape
Professor Bruce M. Firestone
Let’s put ourselves in their shoes (pun intended!)
Professor Bruce M. Firestone
Fundamental Marketing Challenge?Fundamental Marketing Challenge?
Professor Bruce M. Firestone
GROW # of PARTICIPANTS
The life blood of a mass participation event
Professor Bruce M. Firestone
Fundamental Marketing Challenge?Fundamental Marketing Challenge?
The 4 PsThe 4 Ps
PRODUCT
PRICE
PROMOTION
PLACE (Distribution)
They chose to
concentrate here
Professor Bruce M. Firestone
Marketing Focus - PRODUCTMarketing Focus - PRODUCTEstablish the event as a runner-friendly even (meet the needs of the consumer)
• favourable course
• water stations
• health expo
• specific date
• transportation
• accommodation
• balance needs of elite vs. growing recreational runners
• event leadership provided by RUNNERS not EVENT people
• …..Professor Bruce M. Firestone
Promotional activities
• attended other events (booth);
• Face-to-face personal selling
• Media partnerships established
• brochures, posters, etc
• athletes on Board
They established a brand position for their
PRODUCT and they became full-time, never-ending evangelists for the characteristics and
benefits of their product
Professor Bruce M. Firestone
ResultsResults
Average of almost 14% yearly growthParticipation increased by 317% since 2000
Event challenge has now become growth management
152
Professor Bruce M. Firestone
Today
• 2009 - >35,000 participants
• Canada’s largest race weekend
Professor Bruce M. Firestone
EventEvent
Sports ProductSports Product
PersonalityPersonality
Professor Bruce M. Firestone
Professor Bruce M. Firestone
Facts & History
• established in 1994• Founder (Terry Sutherland) working with GE (technology and industrial design)• Approached by Canstar in 1992 to develop composite hockey stick• Passion for hockey so started a JV company; manufactured all sticks under Bauer name• 1997 Nike buys Canstar and stops all NA manufacturing• Terry and group buy JV company back and make private label sticks for Mission, Louisville and their own brand “Ballistik”• In 2004 hockey and baseball business merged under one name – COMBAT SPORTS • currently employ over 100 people
Professor Bruce M. Firestone
Competitive Landscape
Professor Bruce M. Firestone
Brand Position
Everyone at Combat Sports has a genuine love and enthusiasm for the game and our product. Our staff consists of elite level players, past greats and weekend warriors that truly understand the players needs. Not only are we regarded as composite design, manufacturing, and engineering experts, but we are also die hard fans and players of the games. Above all, we strive to understand what players need and want. We truly live by our motto:
Professor Bruce M. Firestone
Let’s put ourselves in their shoes.
Professor Bruce M. Firestone
Fundamental Marketing Fundamental Marketing Challenge?Challenge?
Professor Bruce M. Firestone
Awareness, Education, Trial
Professor Bruce M. Firestone
The 4 PsThe 4 Ps
PRODUCT
PRICE
PROMOTION
PLACE (Distribution)
They chose to concentrate
here
Professor Bruce M. Firestone
Marketing Focus - PRODUCTMarketing Focus - PRODUCT• Owner of 11 patents (another 22 pending
• One of the few companies that manufactured (did not outsource)
• From Day 1, mission was to build the best hockey stick
• Interesting they don’t feel they are there yet but are close
• Launched with product offer of $100 stick with same / better quality than $250 stick
Professor Bruce M. Firestone
• Initial marketing budget of less than $50,000• Gorillas in the market spending millions on traditional advertising• Challenge of perception of quality for unknown brand• Distribution StrategyLaunch: Individual Rep Program
Non-exclusive territoryHigh-margin but lack of control / visibility
Now: Retail dealer networkBrand recognition / demand high enough
Higher volume – margin and profitability
Marketing Focus - PLACEMarketing Focus - PLACE
Professor Bruce M. Firestone
Continue to be grassroots focused;
Demo Days at targeted events
“From Day 1, we felt the most powerful
marketing tool was product seeding – getting
our product into the hands of hockey players.”
Professor Bruce M. Firestone
• Entering NHL Supplier pool too early
• $60,000 investment before you test products, pay players etc.
• Bought in in 2007 but had to exit program and hurt credibility with Equipment Managers
• Lured by the appeal of the NHL shield
• Back in now with better strategy
BIGGEST MARKETING MISTAKEBIGGEST MARKETING MISTAKE
Professor Bruce M. Firestone
Official Supplier
Unique Player deals
Influential coaches and instructors
Professor Bruce M. Firestone
Marketing Focus - PROMOTIONMarketing Focus - PROMOTION
OTTAWA RACE WEEKEND TITLE SPONSORSHIP PRESENTATION
• Multi-million company
• Profitable
• Still privately-held
• Growing
Challenge is to stay nimble and manage aggressive growth
168
ResultsResults
Professor Bruce M. Firestone
EventEvent
Sports ProductSports Product
PersonalityPersonality
Professor Bruce M. Firestone
Professor Bruce M. Firestone
Tony Greco
Facts & History
• graduate of Sports Performance Institute
• Founder of the Greco Lean and Fit program and businesses
• Owns 4 fitness and martial arts schools/facilities in Ottawa
• Radio host / personality
• Personal trainer for several NHL players
Professor Bruce M. Firestone
Competitive Landscape
Professor Bruce M. Firestone
Let’s put ourselves in Tony’s shoes.
Professor Bruce M. Firestone
Fundamental Marketing Challenge?Fundamental Marketing Challenge?
Professor Bruce M. Firestone
Awareness, Image, Credibility
Professor Bruce M. Firestone
The 4 PsThe 4 Ps
PRODUCT
PRICE
PROMOTION
PLACE (Distribution)
Tony concentrates here
Professor Bruce M. Firestone
Marketing Focus- PRODUCT
•Building a product and brand
• Creating natural product line extensions from that core brand
• Expanding those product lines (e.g multiple fitness centre locations)
Professor Bruce M. Firestone
Live Lean · Live Fit · Live Well
Transforming Bodies · Strengthening Minds · Lifting Spirits
Professor Bruce M. Firestone
Professor Bruce M. Firestone
• Brand position: CANADA’S LEADING FITNESS SPECIALIST
• VERY AGGRESSIVE PR / promotion campaign
Marketing Focus- PROMOTION
Professor Bruce M. Firestone
• Community investment piece
• Great PR value
• Foundation created to fight Children’s obesity
“Differentiation”
Professor Bruce M. Firestone
OTTAWA RACE WEEKEND TITLE SPONSORSHIP PRESENTATION
• Profitable company
• Growing
• Recognized market leader
Challenge is Tony’s capacity and sustainability
183
RESULTS
Professor Bruce M. Firestone
Guerrilla and Social Marketing
Guerrilla marketing (GM) is just another term for ‘smart marketing’
Do for a dollar what any fool could do for two
Uses leverage to efficiently and effectively get message out by way of earned media or through more direct means
Substitutes brains for cash in marketing wars
Guerrilla and Social Marketing
If any piece of decommissioned Mir Space Station hits, everyone in continental USA gets free Taco
Taco Bell takes out insuranceCarried by major news outlets across the
planet
Guerrilla and Social Marketing
Taco Bell’s NYSE symbol is GMSymbol is ‘YUM’Most companies would use ‘TBC’ YUM is better for food company, don’t you
think?
Guerrilla and Social Marketing
GM exists in a grey legal area Never do anything that is illegal or
unethical or places any persons or property in danger
Guerrilla and Social Marketing
Guerrilla Marketing Research?Conventional Market Research for Sens in
1990– ‘Would you buy season’s tickets for a NHL team in Ottawa?’
Predicts 100,000 season tickets can be sold
Submit happily to NHLChicago sells 12,000
Guerrilla and Social Marketing
Guerrilla Marketing Research?Real buying decision versus hypotheticalMarket demand for mini offices in Ottawa
circa 1980s?Series of classified ads in local newspaper Telephone answering machine literally in a
cupboard at head office Selling ‘vaporware’ but get real sense of
demand
Guerrilla and Social Marketing Guerrilla Marketing Research? Asking for commitment to lease mini office for a minimum
of three months at a fixed lease rate Strong response meant within two weeks building out one
floor in a west end tower and putting tenants in temporary offices at HQ
TCCL, Terrace Corporate Centres eventually became largest mini office provider in eastern Ontario with 164 mini offices in two locations with occupancy rate exceeding 94%
Profitable in its own right but also acted as source of new lease deals
Apple’s first offices in Ottawa? TCCL
Guerrilla and Social Marketing Guerrilla Marketing Research?
More recent—developer needs to know what rents he might get for new, 2-bedroom units being built in west end of Ottawa
Property manager says $900 per monthREALTOR says $1,100 per monthWho is right and how to test it?
Guerrilla and Social Marketing Guerrilla Marketing Research?
Property Manager bias—lower rents make it easier for him to fill new units(Cautionary note: reverse may also be true. If rents are set too low, it may scare off main stream renters who fear that place may be dangerous and that is why it is priced so low—remember, price conveys a lot of information beyond just dollar figure)
Guerrilla and Social Marketing Guerrilla Marketing Research?
REALTOR also biased—he wants to sell units to investors so he wants to show highest possible rents and highest possible cap rate to investors
My suggestion was simple?In today’s Internet age test market it FOR
FREE
Guerrilla and Social Marketing Guerrilla Marketing Research? Put two free ads on http://ottawa.kijiji.ca/: each ad
describes place slightly differently and each ad would have a different names to contact
Receive about same number of calls on each ad which happily (from investor’s POV) means rent of $1,100 per month will work
They also pick up sense that people calling for units at higher rent were associating higher price with concepts like ‘new’, ‘higher quality building’, ‘higher quality space’ and ‘better class of tenant’
Guerrilla and Social Marketing Guerrilla Marketing Research?
1. It’s not hypothetical market research—it’s guerrilla marketing research for three reasons: a) it’s free or very low cost, b) you are asking about units that don’t yet exist and c) you are not asking a theoretical question (at least as far as the respondent is concerned), you are getting a real call from a real person looking for an apartment.
2. It’s not really ‘vaporware’ either—these units are for sale and for rent and will be built in the next eight months.
3. Typical of GM research, you are leaving out the fact that they are not ready right NOW so you are in a gray ethical area but still, the renter could be looking for later in the year anyway…
Guerrilla and Social Marketing Getting a Place at the Table? Most large firms don’t want to give you a place at trough Students Design Clinic (SDC) Carleton University’s School of Architecture Student-run enterprise SDC is passed on from one student generation to next
with junior designers becoming senior designers and most accomplished senior designer becoming Chief Designer
Oral tradition Surplus (over and above what they paid to students) of
more than $80,000
Guerrilla and Social Marketing
SDC is itself a guerrilla institution—officially frowned on by University’s Administration
Concerned about liability in case of dispute over fees or one of designs is sub-standard
Submit for building permit and meet the OBC (Ontario Building Code)
Liability seems manageable
Guerrilla and Social Marketing
GM program for Clinic is simple and some techniques are old
What is GM?Is it? a) do stunt, b) get national press
coverage, c) send out mass email, d) put out a tweet on Twitter, e) stand back and watch traffic counter rocket or app downloads multiply?
Bad news—not that easy
Guerrilla and Social Marketing
1. Use lawn signs: if politicians use them, it’s because they work and are cheap. On-site signage is great: pylon signs, lawn signs, sandwich boards, window decals, whatever—they’re cheap and they keep working 24/7. Maybe you want to bring back the walking billboard (a person wearing a sandwich board) or better yet: a person wearing a sandwich board giving out handbills which have a call to action on them. So use lawn signs at all your job sites with your Students Design Clinic logo and telephone number and URL clearly visible.
Guerrilla and Social Marketing
2. Lawn signs should cost no more than $10.00 each. Leave them up forever or until your client takes it down.3. Add some type of call to action. How about: “Free One Hour Consultation”4. Put your tag line and your logo on your lawn signs. You are a design clinic so your marketing stuff has to look sharp otherwise it is reverse marketing (don’t do this!)
Guerrilla and Social Marketing
5. Create a second web address that points to existing Carleton address (www.arch.carleton.ca/clinic) which is a bit clumsy. Note: check out www.domainsatcost.ca which is one of Canada’s largest domain name registrars. Try for something like: www.studentsdesignclinic.ca or www.designclinic.ca. (Editor’s note: these URLs are not currently active.)
Guerrilla and Social Marketing
6. Create both private and public spaces on your website. The private password protected space is and will become your ‘institutional memory’ of what works and doesn’t work over a period of years. (The same thing was done for www.kosmic.ca so that students aren’t starting from scratch every year for goodness sake.) Put in things like how to hire and fire; what to pay people; how to monitor performance; how to interview and select team members, what marketing worked and what didn’t—all the hidden keys to success…
Guerrilla and Social Marketing
7. Use PSAs (Public Service Announcements) addressed to print, TV and radio outlets. Your PSAs should go to local publications too such as the Kanata Kourier Standard not just the Ottawa Citizen and the Ottawa Sun. Give them visuals as well.8. Get testimonials for your website and your flyer.
Guerrilla and Social Marketing
9. Create a logo for the Clinic and a tag line that is on everything. Terrace Corporation (the first parent company of the Ottawa Senators) was in the real estate business; they used “Great Space for Great People”. You’ll want something different—it is much too commercial but you need something that speaks to the core competencies of the clinic and your mission.10. Keep a customer data base of tel. #s, fax #s and especially email addresses. The best place to look for new clients and new work is from your existing clientele.11. Every year you should email your past client base with the “news”—what is up with the clinic this year.
Guerrilla and Social Marketing
12. Do a flyer drop not just around the University but also in Kanata, Nepean and Orleans as well as downtown—anywhere people are doing a lot of renovations. Flyers to the home or office are cheap and cheerful and often effective. But don’t wait too long to get them out. They need to go out in February or March not May or June, that’s far too late. Don’t forget to include your call-to-action like ‘Free Quote’ or ‘Free One Hour Consultation’ or ‘10% off’ or ‘Fill in the attached ballot and return it to win great prizes’ or whatever. You can use a variant of the Flyer—the Handbill. It’s a bit different in the sense that it is exactly what it sounds like: a ‘bill’ that passes from your hand to a potential client’s hand directly. It is an old marketing concept but it can be remarkably cheap and effective. And you know that it got to the recipient for sure. Handbills can be given out at a trade show, for example. Something else to remember: marketing is about consistency and repetition. When our family was a partner in a tool and equipment rental chain, we found that our flyers became more effective over time. People began to expect them and to use them more often when we repeated the drops in the same neighborhoods a second, third or even a fourth time over a period of two years.
Guerrilla and Social Marketing
13. Do a customer satisfaction survey. This is where you will get testimonials, references and permission to use them. Put them on your website and on your flyers even in your PSAs.14. Let your clients know that you are never too busy for referrals.15. Avoid expensive advertising and major media like radio, television and daily newspapers.
Guerrilla and Social Marketing
16. Use word of mouth, flyer drops, PSAs and lawn signs.17. Your website is just a support tool but an important one.18. Put photos of finished work on your web site—create a Design Clinic portfolio.19. Everyone is in sales—Chief Designer, Assistant Manager, Senior Table Leaders, Table Leaders, Senior Designers and Designers.
Guerrilla and Social Marketing
20. Make sure you have 24/7 telephone messaging and design clinic email accounts.21. DON’T call your Junior Designers ‘Junior Designers’; just call them ‘Designers’.22. Your next level up is Senior Designer. And so forth—yes, it’s title inflation but it works well in marketing your services. No one likes to be called ‘junior’ and no one wants to hire anyone called ‘junior’.
Guerrilla and Social Marketing
23. Put ‘Free One Hour Consultation’ everywhere—on your website, on your brochure and on your lawn signs. People love FS (Free Stuff).24. Put on your website a few simple to understand reasons why people should choose the Clinic like supporting students, like the exceptional quality of your work, like getting really top notch people to work for them at a fraction of the price they will command just a few years down the road.
Guerrilla and Social Marketing
25. Your flyer should use colour—it is more costly but you are in the design business. Last year 1,000s of good quality colour flyers (8.5 x 11) were printed (one side) for less than 25 cents each.26. Put a copy of your flyer on bulletin boards in stores like IGA, Loblaws, Canadian Tire, Walmart, Home Depot, Home Hardware, building supply stores, etc.
Guerrilla and Social Marketing
27. Coroplast signs are very inexpensive (about $5 to $10 each for 18 inch by 32 inch signs with either two-colour or full colour decals). With the SDC URL, logo and tag line, they make good posters which can be put up with a stapler or plastic ties on hydro poles or city owned fences. (Note you should probably ask for permission from the municipality but in guerrilla marketing people often don’t.) If you put them up high (use a ladder for this), your signs tend to stay up longer. City workers don’t like to get out of their vehicles to unload a ladder, carry it, erect it and climb up the pole to tear down your signs. They’ll call you and you can volunteer to take them down yourself. Perhaps they may reappear somewhere else in the City.
Guerrilla and Social Marketing
28. You can offer to do a few free design jobs using your trainees and the local media can be invited to review the work. Better yet, do a few free designs for high profile persons in the community and get them to talk about it on their shows, blogs, what have you. Get a free endorsement or plug from a local celebrity.29. You can offer to let people buy ‘gift certificates’ for design services for friends and family.
Guerrilla and Social Marketing
30. You can run a contest on your website. The winner receives, say, $200 of design services with first, second and third runners up receiving $75, $50 and $25. The winners always end up spending more.31. Contests could be something like: putting a piece of a famous structure (the Roman Coliseum, the Acropolis, Scotiabank Place, for example) on your website, add to it every day and the first person to email you with the correct identity, wins.
Guerrilla and Social Marketing
32. You can develop a $20 coupon program and give out the coupons to clients and to others to give to their friends. You can also print the $20 SDC coupons in local newspaper ads and folks can clip them out and bring them to the clinic.33. You need to visit established architecture firms to co-opt them into your business ecosystem. Many architecture firms don’t have time for gazebos, decks, fencing, basement renovations or small additions. They would prefer to refer these clients to the SDC.
Guerrilla and Social Marketing
34. Faces are very important in marketing and that includes GM. You need to put a picture of yourself and your team on your marketing materials (web, flyer, maybe even your lawn signs). That way people can see the faces of all your happy, smiling, enthusiastic designers. If there is one ad with a face in it and another without one, the former will get a lot more attention.35. Because this is a design studio, you should probably also have a watermark in addition to your logo. The watermark reflects the underlying principles of your work and is used as a half tone (or a sidebar) on all your drawings, contracts, marketing materials.
Guerrilla and Social Marketing
36. Can you accept Visa? You should probably ask your bank for that service—folks love paying by Visa and even though you have to actually pay a fee (probably 2.75 to 3.25% of each transaction) it will save you a huge amount of time and frustration actually getting paid and the amounts people will spend on design services will also go up! This is a double whammy on your bottom line—collect faster and collect more.37. Don’t forget to ask for a retainer up front. It should be around 45%. Try to get another 45% when the drawings are submitted for building permit. Get the last 10% when you actually get the permit.
Guerrilla and Social Marketing
38. You can set up a referral system—for each client referred to the Clinic that signs a contract, you can offer a premium like a really fantastic SDC t-shirt. This is more promotion for the Clinic—people walking around wearing your logo (and URL)!39. Let people buy your branded promotional stuff. You are, after all, a design shop. Why just limit yourselves to designing real property? Why not use those skills in your marketing as well to create really insanely great branded clothing and promotional items?
Guerrilla and Social Marketing
40. Put out media releases every time you do something newsworthy and feed the press regularly. Make the title catchy: how about Third Wall Theatre Group in Ottawa who put out a press release with the title: “Directors Stab CEO in Boardroom Uprising” to promote Julius Caesar. They got attention in a hurry from the media.
Today, we would add a few new things to the above list including:
Guerrilla and Social Marketing
41. Use social media—start your own Facebook group and use Twitter to develop a following; use these as tools for CRM (Customer Relationship Management) as well.42. Start a blog for the SDC highlighting interesting and challenging jobs you have tackled.
Guerrilla and Social Marketing
43. SEO, Search Engine optimization can do wonders for your website. By increasing your profile in search engine results, you can turn your website into a big lead generator for da nada. SEO includes things like link trading with all your friends’ websites so that more sites link to you. Search engine algorithms look for how many sites link to you as an indicator of how important you are.44. Give your company or organization a name and a website address that are identical so you don’t waste any effort branding different names.
Guerrilla and Social Marketing
45. Go to trade shows like the Ottawa Home and Garden Show and use giveaways (promo items) that are branded with your logo, name, tag line, contact info and some type of call-to-action.46. Network like crazy and use your employees’ and suppliers’ networks too.47. Try to sell to people you buy from (reverse selling). Your AP, Accounts Payable can be a good source of leads. At the Sens, if we needed a plumber he or she was certainly going to be a season tickets holder.
Guerrilla and Social Marketing
48. Volunteer for worthwhile causes in your local community.49. See if you can create an event that’s fun and helps promote your business and doesn’t cost you anything or maybe even generates revenue for you.50. Do some polling: people love to be asked their opinion on just about anything.51. Create a market survey: people like to be asked for their views. They’ll answer your survey, which will also generate information and leads for you.
Guerrilla and Social Marketing
52. Create some type of scoring test on a subject of interest like when to know when it is time to replace your roof or windows…53. Follow the trail of really bad marketing to see who needs your help in your industry. Maybe a local builder needs the SDC’s help with one of their design issues.54. Make sure you can explain your value proposition in three to five separate points to give people a few simple, compelling reasons to buy from you.55. Find sponsors or patrons for your business or organization. Create something that they can sponsor and benefit by.
Guerrilla and Social Marketing
56. Bid on jobs even if you know you might lose: you end up knowing everyone involved with the process; you can build up your network this way for next time. It’s a kind of win-by-losing strategy.57. See if you can get volunteers to help you.
Guerrilla and Social Marketing
58. Don’t forget the Yellow Pages and its related website. Yellow Pages ads are expensive but I have found that even a three line ad can be effective. This give you enough room to have your name, tel. #, URL and tag line. If you can afford it, add one or two more lines for a call to action like ‘Free Quote’ or ‘One Hour Free Consultation’. Your logo would be nice too. You can also sometimes place your ad in a non traditional category where you can stand out. Maybe sneak your design shop into the building supplies category by asking one of the big advertisers there to add your design shop to their ad. Perhaps you could convince them to do that for free…
Guerrilla and Social Marketing
59. Try negative cost selling: it’s huge and works really well. Show the client (preferably with a spreadsheet) how he or she either makes money from buying your products or services, or reduces costs or both. This requires a level of understanding about your client’s situation, which you should have anyway. For example, show them how a basement renovation or adding a granny flat is a negative cost when compared to, say, putting your mother-in-law in one of the those vertical warehouses called a retirement home. (To read more about Negative Cost Selling, please refer to: http://www.eqjournalblog.com/?p=482.)
Guerrilla and Social Marketing
60. Use co-branding. Who is in your business ecosystem? Would they want to pay some (or all or more than all!) of the costs of your marketing? For example, maybe there is a building supplies retailer who provides lumber and other construction materials. Or a builder or landscaper who is winning lots of work designed by the Clinic. Perhaps they want to co-market with the SDC and pay some of your marketing costs. (For more on co-branding and cross-selling, see: http://www.eqjournalblog.com/?p=571 and http://www.eqjournalblog.com/?p=571.)
Guerrilla and Social Marketing
There are so many ways to use GM, the list really is endless and today, through the Internet, a small enterprise can leave big tracks.
Guerrilla and Social MarketingMarketing is a mystery/it’s subtleDon’t need Yellow Pages ads or flyers any
more?How did you hear about us?Answer: Google, Twitter, FB…Get rid of Yellow Pages and flyers?Maybe yes, maybe noMaybe customers really saying their last stop
was Google but forgot to mention saw your flyer or Yellow Page ad before?
Guerrilla and Social MarketingLocal high tech company doesn’t have the
marketing budget to put inserts into the local newspaper for distribution to their target market. So early one morning, the founders go out with abundant pocket change and they open the paper boxes and insert their marketing brochure; then close up the boxes and wait for the phone to ring. Student note: this is probably illegal. Don’t do this but it is an example of clever thinking nonetheless.
Guerrilla and Social MarketingAnother tech company, looking to recruit
top talent, put up hundreds of $2 placards along the main drag where techies working for their competitors tended to drive. They put them up on a Thursday night after city workers had gone home and they remained up for six days before the City had the (illegal) signs removed. The campaign was cheap, cheerful and successful.
Guerrilla and Social MarketingOld Milwaukee Guerrilla Marketing How can you outperform a $3.5 million
Super Bowl commercial with a $700 to $1,500 North Platte, Nebraska TV buy and a ridiculously badly produced ad?
That’s what’s possible in the 21st century via social media
Guerrilla and Social MarketingOld Milwaukee aired a 30-second spot on
NBC affiliate KNOP-TV 2 in one of the smallest markets in the US during Super Bowl XLVI
North Platte has just 15,180 TV homesIt didn’t cost them very much but gave
them the cred they needed to say it was in fact a Super Bowl ad
Guerrilla and Social MarketingFirst, they got 1,640 mentions on Twitter
then a YouTube user by the name of Daddymcc uploaded a cheapo copy of their Will Ferrell-cameo advert to YouTube
So what did Old Milwaukee do next?
Guerrilla and Social MarketingThey turned their IP lawyers loose on
Daddymcc, YouTube and Google, of course, to force them to take down an unauthorized version of their ad
They sent them a sternly worded cease-and-desist-letter threatening them with legal Armageddon
Not!
Guerrilla and Social MarketingWhat they really did was link from Old
Milwaukee’s official Facebook page to Daddymcc’s upload
After that, they got over 1 million views in the 11 days subsequent to the 2012 Super Bowl compared to say Budweiser’s professionally-produced eternal optimism Super Bowl ad (http://www.youtube.com/watch?
v=enfJEibY1nY) which got just over 400,000 in the same time period
Guerrilla and Social MarketingThe Old Milwaukee ad is beyond cheesy
(http://www.youtube.com/watch?v=tejGMPAShdY)Guerrilla marketing (in this case, a form of
ambush marketing) is about substituting brains for money
No way can OM compete with Bud’s deep pockets so they did this instead
It’s what entrepreneurs do every day
Guerrilla and Social MarketingAmbush marketing tends to happen every
four years when the Olympics come up. It is so expensive to be an official 5 Olympic Rings sponsor that even major companies are sometimes forced into guerrilla marketing
Or perhaps if they are shut out of the Olympics by a competitor who has category exclusivity, they could decide to ambush both them and the Olympic movement
Guerrilla and Social Marketing A while back a major shoe company did ambush
marketing at Atlanta Summer Olympic Games While one of their competitors paid $40m to be an
official sponsor, they set up a mega tent on a parking lot down the street from the main Olympic venue
They filled the place with product, interactive games, VIP sections, you-name-it
It became the in-place to be during those games and they scooped the competition and scored a major PR hit—both admiring and outraged reactions were welcomed
Bundling and Co-brandingLululemon Athletica not only sells active
wear they also have Yoga classes in their stores
In essence, they are housing two complementary businesses under the same roof
But there is no reason why they could not be offered by two different organizations
Bundling and Co-brandingKey is to view enterprise as a platform on
which to build a community of interestsWhat services or products does it make
sense for you to bundle with your core offering (i.e., they complement it)
Or can you unbundle/break apart your core offering to uncover separate services or products that could be offered by others?
Bundling and Co-branding If you get others to use your platform, you push some of
your capital costs onto them Becomes a form of bootstrap capital May also pay you both a rights fee and rent just to be part
of your offering! Lululemon could rent stores to Yoga professionals for
classes and create two revenue streams that way—more clothing sales plus hall rental
Also a form of negative cost marketing since Yoga studios would be paying Lululemon to bring their clients to Lululemon stores
Similar to co-branding and co-opetition
Bundling and Co-brandingTCCL, Terrace Corporate Centres, largest
mini office provider in Eastern Ontario Word processing business Lost about $3,000 per month Unbundled business/spun it out to
independent entrepreneur (who paid $50,000)
Turned it around in just six monthsWent from cost centre to profit centre for us
Bundling and Co-brandingMountain Equipment Coop sells bikes,
running shoes, kayaks, canoes, outdoor clothing, cross country skis…
Adding 500 square-foot space to existing store in Westboro
Making it available for community use by sports and environmental groups
Want to be more than store– a central part of community commitment to active lifestyle
Bundling and Co-branding Apple this with their stores You not only buy Macs, iPhones, iPads, iPods et al
but also attend free workshops, get stuff repaired, ask for assistance at Genius Bar, get help setting up your computing and communications environment, learn how to use iTunes and app store, get one-on-one training if you need it…
It’s all about bundling services around your core offering and creating a platform
Bundling and Co-brandingBundling can also involve co-brandingEg, marketing Brooks Brother’s suits with
Audi cars and Rolex watches or, better yet, bundling them all together—buy Audi and get Brooks Brothers suit plus Rolex thrown in!
What’s interesting is that these three products can become sales channels for each other
Bundling and Co-brandingHere is unlikely duo: Xerox co-promoting
Michelin in its advertising in Bloomberg Businessweek (March 11, 2012)
Bundling and Co-brandingNo more unlikely than Michelin starting its
Michelin Guide in 1900 to help motorists find accommodation and restaurants
Anything that got more people driving further and more often was, indirectly, good for their tire company their thinking went
However, Guides became own profit centres
Bundling and Co-brandingThat is, they stood on their own As well as providing negative cost
marketing and co-branding for tire company
These concepts are not new but forgotten by successive generations only to be rediscovered...
Everything old is new again…
Bundling and Co-branding Bundling is gaining traction as a biz model tool Recent announcement by Chrysler that it will
certify and sell used cars by OTHER manufacturers
Why not extend their warranty program? It is a profit generator Plus having more people, some of whom are
perhaps not interested in Chrysler but are in say Hondas and Toyotas, come to their stores means that, at least, now they have a chance to persuade them otherwise
Bundling and Co-branding Not easy to tell difference between hardware,
software, consulting, outsourcing, products, services or app tech company
They are all using biz models as platforms to poach on each other’s territories
Become counter cyclical Makes more efficient use of fixed costs caused
by their underlying investment in office, lab and manufacturing space as well as administration costs, investment in staff and staff training, equipment and other basic requirements without which they cannot operate
Bundling and Co-brandingIn entertainment business, Bloomberg
News’ Norm Betts reports that Netflix CEO Reed Hastings meeting with cable operators to discuss a way for Netflix to be included with monthly cable bills
This would be a way for Netflix to add huge new numbers of subscribers by using existing cable networks as, in effect, Netflix resellers
Bundling and Co-branding Netflix would then be on more level playing field
with Showtime, HBO and other specialty cable channels
More subscribers, steadier and higher committed monthly recurring revenues
Better able to compete for directors, screen writers, stars, talent, screen plays and so be able to offer more original content– series and films
Bundling while developing reseller sales channels will make Netflix an even more formidable competitor
Guerrilla and Social MarketingEthicsOne of keys to success is to be accepted
part of your business ecosystemOnce you are embedded in a business
ecosystem, you are very hard to dislodgeTrust is No. 1 thing in life and businessDo not engage in unethical practices in
GM or anything else you do
Guerrilla and Social MarketingMedia ReleaseMedia releases are tricky to do These days people are saying they’re less
relevant as mainstream media fades Mainstream media still mattersFor how long, no one knowsBut one thing is clear, it matters less than
it once did
Guerrilla and Social MarketingYou can talk to more people in a few
seconds on ABC World News with Diane Sawyer than you can if you gave a speech before a live audience of 1,000 people for 7,950 days in a row*
Almost 22 years of live engagements just to match 10 seconds on Diane’s show
(* ABC reports that for November 2011 sweeps, ABC World News with Diane Sawyer delivered 7.95 million total viewers.)
Guerrilla and Social MarketingInstead of Diane’s show, say you reach
1,000 influential bloggersBlogs like EQJournal.org have more than
52,000 individual IP addresses accessing it
Assume you reach 1,000 like itBy engaging blogosphere, you could
potentially deliver 52,000,000 viewers, far more than what Diane does
Guerrilla and Social MarketingBlogs, Twitter, FB, Digg, Reddit and
YouTube are cratering mainstream media, in part, because they are inexpensive, authentic (for the most part), democratic and non-elitist
So why go to the trouble of writing media releases at all?
Most important reason to record in a systematic and careful way the history of your event
Guerrilla and Social MarketingTwitter NationIn 1953, Arthur C. Clark predicted (in his
novel Childhood’s End) that by the turn of the 20th Century, long distance would cease to exist
Browser, Email, IM, My Space, Skype and others (Facebook, Twitter, LinkedIn, Google+ et al) came along around that time to make his prediction largely come true and then some
Guerrilla and Social MarketingTwitter, which is outward facing in a way
that its competitors are not, brings with it a level of utility beyond other social media that benefits entrepreneurs and intrapreneurs to a great degree
Communicate, two way, with the world for free
Influence your clients, customers, suppliers, colleagues, partners and sponsors in a way never possible before
Guerrilla and Social MarketingFB is about friends and familyTwitter is for friends, family, colleagues,
acquaintances, co-workers, direct reports and fans
Just imagine having 1,000 followers or maybe 5,000 or possibly 50,000 or even 500,000
Guerrilla and Social MarketingIf you change jobs, need a job, start a new
enterprise, learn something cool, participate in an event, need input on a new logo, want to run a poll on a new product or service, want to share information, feel like speaking your mind, need an apartment, want to organize a meet-up, publish a book, write a new blog post, need more clients, have to find a new supplier…you can broadcast a message that instantly seen by everyone who follows you
Guerrilla and Social MarketingYou can DM (Direct Message) them
privately, you can mention them publicly using the @mentions feature (recently renamed @connect), you can create lists of certain groups (like I do for my former students)
You can follow people of interest to you and see what they are doing, what they are reading or watching and learn from them
Guerrilla and Social MarketingYou can tailor your follow list so that it
includes news on subjects of interest to you—which might include current events or obscure subjects of interest only to a handful of people on the planet including you
Integrate Twitter into classes Answer questions like: ‘Hey Prof, when is our
essay due?’ Can tell whole class with single tweet instead
of, say, 45 emails
Guerrilla and Social MarketingUse hashtag feature (which the Twitter
community created)#ec3396 and #MBA6298, course codes
preceded by ‘#’ sign (which is nicknamed a hashtag)
Guerrilla and Social MarketingStudents can see not only answers to
mundane questions but also answers to more substantive ones
Hashtag feature allows cross-conversations to develop
Not always Prof talking to students or vice versa but students helping each other and other students jumping in
Guerrilla and Social Marketing@mentions (@connect), favorite and
retweet features allow you to give props to a follower or, for that matter, anyone on Twitter
If something is really important to you, you can tweet it out at different times of day
Individualize backdrop to your Twitter home page
Guerrilla and Social MarketingUse Twitter as a ’social’ media which
means you engage in conversations It is not a sales toolTry to answer as many @connects as you
can and all your DMsSpend about 10 minutes a day on the
service because you integrate it into your workday
Guerrilla and Social MarketingWhen you are meeting someone or
working on stuff and you trip over something that you think your friends, fans and followers will find interesting, add it to your Twitter feed via your smartphone app
It will take you 12 to 18 months to find your ‘voice’ on SM
So tweet at least 1/day until you get the hang of it
Guerrilla and Social MarketingYou can and probably will have multiple
Twitter channelsMy main account is @ProfBruce but
recently we’ve added @BootstrapAwards, @Exploriem, @BizModelComp, @Century21Expl and others
We can narrowcast with these other Twitter feeds and be more openly commercial with the latter without compromising the integrity of @ProfBruce
Guerrilla and Social MarketingPeople who follow @Century21Expl are
presumably folks interested in commercial real estate
So they will want to watch this feed to see if they can pick up any commercial property that suits their portfolio or budget
Or learn any ‘tricks of the trade’ so to speak
So it’s OK to be blatantly commercial here
Guerrilla and Social Marketing I would not buy any URL today without getting
the exact @Twitter equivalent whenever possible
Probably try to get identical Facebook page vanity URL too
So if you are buying ProfBruce.com, try to get @ProfBruce and Facebook.com/ProfBruce
You only have a few seconds to impress someone with your brand so why make it harder on everyone if you own ProfBruce.com but your twitter handle is kool_dude-1990?
Guerrilla and Social Marketing Twitter’s API (application programming interface)
is being adapted to add a social layer to many biz models today
If you can place your enterprise at the centre of a community tied together through the fan/friend/follow/follower model (Twitter is just one option among many you can choose from), it will be much harder to knock off or outsource and kill
It can create a sustainable competitive advantage for you
Guerrilla and Social Marketing Facebook comments was brilliant move to
extend FB franchise and Twitter should respond by embracing that as well
Never liked anonymous comments—they can be outrageous, libelous and untrue with no repercussions for those posting these sometimes hateful and shameful things
One thing that Twitter and FB do very well (especially FB) is verify who you are; how many people will follow you if you are a fraud?
Folks will catch on and drop away
Guerrilla and Social Marketing There is no hard and fast rule about who you
follow Should you follow everyone who follows you? I think you should be selective because, if you
have a lot of followers, it’s hard to have a real conversation with 5,000, 50,000, 500,000 or millions of followers
But I also understand the democratic urge to follow everyone back
It’s up to you