Is a traditional marketing campaign going to sell motor oil?

Petronas is Malaysia’s state-owned energy provider and it is the only Malaysian company to be listed in the FORTUNE Global top 500 companies.

Its lubricants division, Petronas Lubricants International (PLI) in association with M&C Saatchi has recently launched a global brand campaign for its flagship product Syntium. M&C Saatchi is responsible for the creation and development of the overall campaign.

The campaign features a 30-second TV commercial that is currently being aired across Astro and Malaysian terrestrial TV channels, radio, print ads and digital initiatives although a quick search of ‘Petronas Syntium’ on Facebook and twitter uncovered zero activity.

And of course, as with any traditional creative driven campaign, there will be lots of below-the-line collaterals.

Costing only about US$350,000 (RM1,000,00) which includes production costs and execution, the campaign has launched in Malaysia and will be pushed out across PLI’s key markets including China, Thailand, Italy, South Africa, India and more. It’s not known if that amount includes the campaign execution across all countries.

M&C Saatchi states that ‘the new Syntium brand campaign was produced using state-of-the-art CGI animation with the core message of the ads reflecting PLI’s fresh approach towards knowledge and technology – Fluid Technology Solutions’.

Do consumers still pay attention to traditional campaigns like this one that haven’t really changed since the 1960s? I know it includes social media but there doesn’t appear to be much going on online. So it’s a yet more noise and clutter to add to the deafening noise consumers are ignoring.

Although I haven’t seen any of the TVC’s, print ads or heard the radio ads I’m sure they will be very well executed and the cutting edge CGI animation will blow me away but the question has to be, will it sell more oil?

I value your comments and thoughts on this issue.

How to brand a destination to attract investors, the right businesses, talent and tourists

The destination branding rewards are high in terms of investment, jobs, development, tourism, exports, domestic and even international influence. But building destination brands is harder today than ever before. There are over 1,000 national and regional economic development agencies in South East Asia alone and the ongoing global economic crisis, political interference and a fragmented, tactical approach to a strategic initiative all help complicate the process.

It’s also hard because most destinations attempt to build their brands on a platform of familiar marketing and advertising campaigns that include one-size-fits-all positioning strategies driven by advertising in mass media, that do little more than add to the advertising clutter increasingly ignored by consumers. And more often than not, those campaigns are led by tourism.

Tourism maybe about to become the number one industry in the world, but did Indonesia’s 2008 tourism campaign and the tagline “Celebrating 100 years of nation’s (That is not a typo) awakening.” influence South Korea’s Hankook Tire when it was looking for a location for a US$1.2 billion tyre plant? Of course it didn’t.

Hankook Tire sought a good location close to transport hubs, a secure source of quality rubber, abundant and cheap labour and probably the opportunity of an early crack at Southeast Asia’s biggest economy.

Indonesia is on something of a roll at the moment and is expecting as much as US$10 billion of investment from South Korea alone over the next four years. And it’s not just Korean firms that are looking hard at the country.

The steel company Arcelor Mittal is currently considering a US$5 billion investment and China Investment Corp is rumoured to be considering an investment of as much as US$25 billion. A number of other deals are also in the works but although details a sketchy, one thing is for sure, none of them will be swayed by positioning statements or slick advertising campaigns featuring white sandy beaches, azure skies and crystal clear seas.

These companies will make their destination decisions, and this is particularly true of Indonesia but also applies to other Asian destinations, on political stability, a clearly defined long term plan to invest in railways, roads, power plants and distribution networks, ports, transportation and more as well as concerted attempts to tackle bureaucratic red tape, graft, and unfriendly labour laws.

Indonesia understands this and regional competitors would be wrong to ignore this sleeping giant. President Susilo recently instructed the relevant federal and state or regional authorities to speed up spending, particularly on infrastructure. Assurances from the central bank that it would not impose outright capital controls will do a lot more to convince potential investors than any expensive tagline or one-size-fits-all positioning statement.

Don’t get me wrong, tourism has an major role to play in the development of many destinations but an international one-size-fits-all positioning statement that attempts to speak to potential investors, tourists, talent and others from diverse parts of the world with one message is not the way forward.

So what can regions, states or cities do to build destination brands that will attract investors, businesses, talent and tourists?

Once the infrastructure is in place or the blueprint outlining the infrastructural development with timelines, responsibilities and milestones is determined, destinations must carry out research to identify channels, communities and influencers within those channels and communities and develop content that resonates with those influencers and those communities.

Prospects from different industries from different parts of the world have different requirements for value. Sarawak corridor of renewable energy (SCORE) on Borneo is targetting ten core industries. Those industries are as diverse as Aluminum, Aquaculture, Fishing, Glass, Timber and Tourism. Such diverse industries with their different requirements for value, will seek information from and be influenced by completely different environments.

Identifying those requirements is mission critical, without it destinations are guessing and the success of a destination brand should not rely on guesswork. So destinations must talk to prospects and customers from each segment. Find out what value they seek and determine if the destination can deliver that value.

To avoid wasting valuable resources on advertising and marketing that is lost in the clutter, it is important to determine what online communities they inhabit and who or what influences them. Also identify why investors chose the destination. And talk to lost customers and find out why they chose another destination over yours.

At the same time, internal brand research must identify what are the core brand values of the destination and how will they be communicated internally so that the whole organization is on brand and understands the role they play in the successful implementation of the brand. And it is critical that the core brand values are developed with customers in mind and not from the destinations point of view.

The analysis and data from this key research will form the foundations of the destination brand strategy. And only once the brand strategy is developed can the implementation begin. The implementation must not neglect citizens and their communities who will be impacted by the changes to their environments.

There will be positive and negative implications for communities and these must where possible be predicted and dealt with accordingly. If they cannot be predicted, they must be dealt with in a consistent, transparent and confident manner. It is important for destinations to understand from the outset that without citizen and other stakeholder buy in, the destination will not succeed.

Increasingly fragmented media, the Internet and an increase in leisure time activities make it harder to reach consumers via traditional media. Destinations must look past the traditional broadcast approach to generate interest in the destination.

One destination in South East Asia purchased a double page spread in the International Herald Tribune to market the destination. The feature was really well written, with top quality images and provided a comprehensive overview of the destination. But the feature made the common mistake of trying to tell everyone about everything.

This approach hopes that the advertisement or feature will be seen by the right people at the right time and that they will invest the time required to read through the substantial feature in the hope that there will be something relevant to them. The problem is that there are lots of competitors doing the same thing and moreover, how many senior executives are willing to invest time reading such articles?

This particular feature also made the mistake of not including any tracking tool to identify the number of responses. Any marketing efforts must include tools to measure their effectiveness because if you don’t track the effectiveness of your marketing efforts, how do you know which ones are working and which are not?

Communications must also take into account changes in consumer behaviour and look past the traditional media channels with an emphasis on the Internet and Social Media. And this will require a comprehensive change in the thinking of CEOs and others tasked with developing a destination brand as it requires ongoing engagement with consumers rather than a traditional broadcast approach.

To be successful, destination brands must now adapt to these emerging business and customer imperatives. Imperatives that include a special emphasis on the right research and the right data collection and analysis, effective customer, channel and employee communications, operational excellence, accountability, service and the ongoing ability to meet customer requirements.

The potential rewards are huge but the stakes too are high and with competition coming from all angles, destinations will only get one shot at building a successful destination brand.

How to sustain a family retail brand

The picture below was taken in 1912 in Oxford, UK a city about 60 miles to the North West of London. It features Gill & Co, an ironmongers and a branch of J. Sainsbury, a food store.

Gill & Co was established in 1530 during Henry VIII’s reign. At the time it was the first ironmonger in the country. It has been in business ever since and has witnessed the English Civil War, two World Wars, a couple of global economic depressions, three recessions, the birth of the railway, the car, powered flight, electricity, the Internet and more.

Originally the firm supplied ironware and related products for Oxford residents however as times changed it tried to reinvent itself and also stocked equipment for chimney sweeps (think Mary Poppins), farming equipment, tools and gardening supplies. Although Gill & Co moved locations, it was always a one store operation in Oxford.

In 2010, after 480 years in business Gill & Co is closing down, beaten into submission by large DIY and home improvement suppliers like B&Q the 3rd largest DIY retailer in the world, largest in Europe and the largest in China and Homebase.

Sainsbury’s, at a mere 141 years old, a relatively new brand was established in 1869 in Drury Lane. Although now at the centre of the theatre district, this was once a very poor area of London.

Sainsbury has also witnessed much, including 2 world wars, 2 depressions, a couple of recessions, the automobile, manned flight, the moon landings and more. Sainsbury soon became an institution, offering high quality products at low prices. By 1882 Sainsbury was selling it’s own label brands.

Although lacking the heritage of Gill & Co, Sainsbury invested heavily in its staff, employing women as managers when it was unheard of in the early 20th century and developing its own training school to train managers.

Sainsbury also invested in new stores and although at times it has had a rough ride, today it employs more than 150,000 people, has 800 stores in the UK and there are on average more than 19 million customer transactions in Sainsbury’s stores every week and the company has a 16% market share.

It has diversified into non-food products and services and non-food is growing 3 times faster than food. It has a bank with operating profits of £19million and its Internet home delivery shopping service is responsible for 100,000 deliveries every week.

Asia has many small family businesses. In fact in Malaysia, Small Medium Sized Enterprises (SME’s) make up 99% of Malaysia’s total registered businesses. Hanoi in Vietnam has over 90,000 SMEs.

These organizations have a critical impact on the business of a country. In Japan, known for its heavy industry, approximately 70% of the Japanese work force is employed by small and medium-size enterprises (SMEs) and half the total value added in Japan is generated by SMEs.

Asian SMEs, many of them well established with years of heritage cannot sit by and hope that they will be safe from bigger, more aggressive retailers. They need to start planning for the future now before it’s too late.

Here are 5 recommendations for Asian SMEs to help them become a Sainsbury

1) Keep an eye on retail trends, especially in your space
2) Talk to your customers, not just about the weather/politics/sport. Ask them what their needs are, what they would like you to stock, when they would like you to open and so on
3) Build a database of customers and their preferences. If you do sell up, this will help you secure a better price for your business
4) Leverage what you have against the big retailers in your space. You can’t compete on price and probably can’t compete on choice but you can compete in other areas – convenience, personalization, customization, free alterations, returns, speed of delivery and more
5) Develop a brand strategy that includes succession planning. If you have sent your kids to university overseas, are they going to come back and work in your hardware store? If you don’t think so, look to create strategic relationships with other players in your space now before it is too late.

Social Media is not a branding silver bullet

A brand is built not on acquisition but on retention.

And retention requires a relationship. And a relationship is based primarily on ‘Trust and an ongoing, sustained engagement, on customer terms that provides economic, experiential and emotional value to the customer’.

That’s what branding is all about. It’s not a communications exercise. It won’t happen as a result of an advertising campaign. And it won’t be carried out on the pages of Facebook. That’s right, social media is not a silver bullet.

Social networks give us the tools to engage with consumers and build relationships with them. But like any tool we need to use it properly to get the most out of it. We still need marketing with links to articles, while papers, blogs and so on that appeal to target markets.

Unfortunately the majority of brands are continuing to use new tools such as social media, that allow them to lay the foundations for a relationship with consumers, in the same way as they use mass market tools that trumpet a one-size-fits-all approach to marketing.

I recently tweeted about a cool bit of kit from sonos, makers of wireless digital audio systems. I asked if there was a Sonos dealer in Malaysia. Sonos tweeted me and told me to contact someone in Singapore and obviously allerted them as I got a tweet from the Singapore guy with an email of the distributor in Malaysia. I emailed the distributor and didn’t get a reply. Sonos hasn’t contacted me to see if I purchased and nor has the Singapore distributor followed up.

There is no silver bullet with social media. It won’t solve all our branding problems but, used correctly, it will help us build relationships with customers. From there you might, just might build a brand

Mass emails have a negative effect on your brand

In the early days of the Internet, as brands tried to capitalize on the consumer accessibility email addresses offered, spam was a real problem. But more efficient filters and the ineffectiveness of the one-size-fits-all mass marketing approach soon saw a reduction in spam.

Unfortunately, after a brief lull, the amount of mind numbingly irrelevant and sometimes irreverent emails that I receive from a variety of sources seems to be on the rise. But what’s surprising about the latest avalanche is that many of the emails are coming from advertising industry trade publications that should know better.

Recently I received 3 emails telling me how great a new radio station is. I received another three telling me about the launch of the Mandarin version of the same trade publication.

Now I understand that when I agreed to submit irregular articles to the publication, I probably also agreed to receive ‘carefully chosen 3rd party promotional messages’ but these emails were in Cantonese (I think)! Marcus Osborne does not sound like someone who might be interested in listening to Cantonese radio stations!

I’m also getting tired of receiving badly targetted emails from supposedly tech and branding savvy organisations like Amazon. Now this may be a coincidence but earlier this week I went to to see if I could buy a Kindle. Unfortunately because I live in Malaysia I cannot buy one and even if I could it would be useless because none of the titles available on Kindle can be downloaded in Malaysia. I was obviously disapointed but after a while you get used to these things in South East Asia. However this morning I received an email from Amazon suggesting I buy my father a Kindle for Father’s Day. That really is rubbing salt into the wound.

Case studies of successful email campaigns are hard to come by, but American Greetings Interactive, an online supplier of greeting cards increased customer engagement by 13% between October 2009 and April 2010 thanks to a number of targeted email marketing campaigns.

Rather than shooting out the same email to the whole 5 million member database, American Greetings Interactive and their partner, Metrics Marketing, segmented the card company’s customer database into more than 15 sub segments and created relevant content based not only on the members status, but also previous history, account type and more.

This focus on relevant content and information that resonated with each of the sub segments increased engagement and resulted in more click throughs, more information, more referrals, opportunities for increased share of wallet and more subscriptions.

If you have something to offer, identify those in your data base who may be interested and target them alone. It may take a little time but it is time well spent. Otherwise using mass emails to try and sell the same product to everyone may actually have a negative effect on your brand and you may end up actually turning those customers away.

Louis Vuitton in a spot of bother over print ads

The Advertising Standards Authority (ASA) in the UK has received complaints that print ads for Louis Vuitton created by Ogilvy and Mather suggest that the products were made by hand.

Certainly looking at this ad that shows a woman creating the lines for the folds of a wallet

and also this ad that appears to be a woman stitching a handbag

It is easy to see why there have been complaints. Especially as the copy states, “infinite patience protects each overstitch… One could say that a Louis Vuitton bag is a collection of fine details.”

However, according to marketingweek Louis Vuitton defended the campaign by saying that “their employees were not assembling pre-packed pieces but were taking individual handcrafted and hand-sewn parts through a range of hand-made stages to reach a final item.”

Louis Vuitton added that the use of hand sewing machines and associated tasks were “part and parcel of what would amount to ’handmade’ in the 21st century”.

So handmade doesn’t actually mean handmade in the traditional sense?

If that is the case does that mean then that the iconic hand made Hermes Birkin bag that can cost anything from US$10,000 to well over US$100,000 isn’t actually hand made?

Does this mean that the animal skins used in a Birkin bag are not actually spread out on the floor of the processing room and screened by a number of artisans before being measured and cut by hand as required?

Does this mean that the bottom of the handbag is not sown by hand to the front and back with waxed linen threads?

Does this mean that the handle of the Birkin bag is not manually stitched until the shape comes to the fore?

Does this mean then that the artisans don’t use sand paper to smooth rough edges? And does it mean therefore that hot wax is not applied to the handles to protect them from moisture?

And all the effort that goes into the front flap, the metal and lock is not actually done by hand?

Does it mean that the craftsmen in France that all work out of the little lane in Paris don’t actually exist?

And advertising agencies wonder why 76% of consumers don’t believe that companies tell the truth in advertisements. In Malaysia that figure is 86%!

The number one element in any relationship is trust. If a brand wants to build a relationship with a consumer, that consumer must be able to trust the brand.

An element of doubt in communications is not a good way to build trust.

Most Asian firms should not consider Positioning to be the right tool for Branding initiatives

Two of the most famous names in marketing – Jack Trout and Al Ries developed the concept of positioning back in the 1970s. Their business/marketing book, Positioning: The battle for your mind was written in the early 1970s and almost forty years later, is a well thumbed addition to the book shelves of respected marketing professionals around the world.

Jack Trout and Al Ries developed the concept of positioning because they believed that branding was becoming increasingly difficult as audiences were inundated with numerous and confusing communications. Positioning was promoted as a tool to “break through the clutter.”

Today, the following product description for the latest edition of the book on Amazon is: “Positioning” describes a revolutionary approach to creating a “position” in a prospective customer’s mind – one that reflects a company’s own strengths and weaknesses as well as those of its competitors. It goes on to say, “Advertising gurus Ries and Trout explain how to: make and position an industry leader so that its name and message wheedles its way into the collective subconscious of your market – and stays there.”

I disagree with this statement. Positioning may have been revolutionary in the 1970s but it can hardly be described as such today. Furthermore, where I come from, ‘to wheedle’ is not really a flattering term. In fact the free online dictionary has this definition, “To obtain through the use of flattery or guile: a swindler who wheedled my life savings out of me.”

The concept of Positioning also suggests the ‘position’ should be based on being first in a particular category. If another company is already first in the category, then the company should work to redefine itself in a new category to ensure it is first in that category. This was really important to Ries and Trout. In fact so important, that they felt it was more important to be first in the mind than first in the marketplace.

In the mass markets of the 1970s and 1980s, positioning was defined by perceptions. To influence perceptions and maintain a position within the relevant minds, it was imperative that companies dictate the information consumers received.

And, because of the power of mass media, this wasn’t an impossible task. Moreover, because most audiences were relatively passive, and they had little choice of products, well-researched messages were likely to register with targeted audiences.

Furthermore, advertising agencies and in house marketing departments also embraced the concept of positioning because it gave them total control yet there was little opportunity for accountability. After all, it was relatively easy to show progress in awareness or top of mind, but first in the category was tough to measure.

As a result, positioning was adopted by many companies and became a successful tool. In the face of this increased competition, many companies took the wheedling part at face value and started to manipulate information to control a hard fought for position that was threatened on many fronts. Soon fantastic claims were being made in advertising and other channels.

One example is the tobacco industry that tried to convince consumers that tobacco wasn’t addictive. Ford made a similar attempt to persuade prospects that the Pinto did not have design issues. More recently there were some outrageous claims around the Enron scandal and certain financial institutions last year were wheedling furiously!

Unsurprisingly, this has caused consumers to become more disillusioned and cynical and less likely to pay attention to claims made by advertisers. Here in Malaysia, 84% of those polled in a recent study by a daily newspaper said they didn’t believe what they read in advertisements. This despite the fact that many of the companies featured in those ads were attempting to position themselves in the minds of those very consumers.

Because positioning relies on mass media, it has to appeal to as many people as possible. This may be alright in a single or homogeneous market but what happens when a market is segmented?

Furthermore, firms consider a positioning campaign to be the communication of a particular message to a mass audience. But what happens if that audience doesn’t listen or accept the message? The advertising agency will tell the company to do it again, perhaps after tweaking the creatives a bit. This is also known as repositioning.

Jack Trout, this time with Steve Rivkin, released a book last year entitled REPOSITIONING: Marketing in an Era of Competition, Change and Crisis. The back cover calls this “A brilliant new book” and states, “So you’ve mastered the art of marketing. You’ve positioned your company, branded your product, and targeted your consumer. Unfortunately, in today’s economy, that’s not enough. You need REPOSITIONING.”

I haven’t read the book so I can’t comment but I have my doubts as to the effectiveness of repositioning.

Don’t get me wrong, I do think that positioning is a tool that was, in its time and for many products, a very good tool. But I don’t think it has a role to play in today’s customer driven economy. There may be some exceptions such as in the destination branding sector and some soft drinks may benefit but these are the exceptions not the rule.

I know it is hard to let go and there will be a lot of resistance to what I have written. After all, so much effort by so many people has gone into learning about positioning. But the world has changed. More importantly, consumers have changed. And marketers should acknowledge this and change with it.

Communications and the way consumers live have changed a lot over the last 40 years. Isn’t it time Branding and the way brands are built and the tools used to build those brands changed too?

3 words that can ruin your brand in Malaysia and Singapore

If you are in Malaysia or Singapore and you sell stuff to customers, there is one phrase that can ruin your brand.

“No stock Lah.” Is repeated time again by poorly trained and disinterested staff.

This seemingly innocuous phrase should be banned in your organization. While we’re at it, you should also ban the obligatory disinterested shrug of the shoulders that normally comes with the phrase.

For the uninitiated, the phrase is common in retail outlets the length and breadth of Malaysia and still, despite the alleged sophistication of the city state, in many of the malls up and down Orchard Road in Singapore.

This simple yet powerful phrase, used with annoying regularity in both discount stores and swank boutiques of luxury brands negates every penny your organization has spent on sales training, reputation development, customer service, customer relationship management and other operational excellence initiatives.

It renders worthless the massive investments you have made in licenses, real estate, interior design, stock, utilities and more.

It erases the hard work you have put into press releases, press conferences and other promotional efforts.

It undoes all the good of the advertising campaigns you have run for years in an attempt to get a consumer or two to give your brand a chance.

In a heartbeat, it ruins every single, expensive effort, financial and otherwise you have put into getting the consumer into your store.

In short, this seemingly innocuous phrase can ruin your brand.

Should destinations brace themselves for a brutal summer?

Grant Thornton has published a report that forecasts 373,000 visitors to the Football World Cup in South Africa in June. That’s a drop of 110,000 from original forecasts.

The big question is, are fans waiting to the last minute to book tickets or is this a sign of the recession? Certainly political tensions in the country may be causing fans to wait and see before making a decision on a significant financial commitment. After all it’s not just the match tickets. Fans also have to take into account the cost of flights, accommodation and internal travel which can be significant distances. Grant Thornton predicts fans will have to fork out US$4,000 each. For a family of four, that’s US$16,000 for a summer holiday in a recession! Hard to justify.

But I believe that the poor ticket sales are a result of the global economic situation. And if I am right, destinations in South East Asia could be heading for a brutal summer.

I think that free spending Europeans will forego an international holiday and instead invest in a large LCD or Plasma TV and stay at home to watch the World Cup. If they do go away, it will be either for a short domestic holiday or somewhere in Europe. I expect Eastern Europe to benefit.

If I am right, what should destinations do to soften the blow?

Well the first thing is to curtail one-size-fits-all mass market TV advertising communicating the usual white sandy beaches, tropical blue skies and azure seas. There is simply no differentiation from other destinations. Consider this comment from Qualitative research carried out by FusionBrand in the United States earlier this month,

“Watching the basketball today and an ad came on for a destination with some really nice water/resort images. It was Malaysia. But is (sic) struck me that the line Truely Asia gave me the feeling that they were trying very hard to say, “us too”. It gave me the feeling of them saying “we’re just like the other (good things) in Asia”. But the images in the ad could have been in the Carribean.”

How confusing is that?

There is no time to build a communications strategy for 2010. If it hasn’t already been done, and at least 2 countries in South East Asia don’t have a plan for 2010, it is too late. But there is still time to develop an integrated tactical approach to activity based not geographic based marketing.

Thirdly, embrace social media, NOW. Start to engage prospects and those who have visited via social media. Redistribute resources, train staff and create teams to build relationships with consumers via Facebook, Twitter, Travelocity, Tripadvisor and others. Forget about the old global buys on CNN and the BBC. Creating awareness via mass marketing wastes valuable resources and anyway, consumers aren’t listening. Reinvest that money in engaging consumers.

Fourth, don’t ignore the traditional web. Make sure your website is as contempory as possible. If you are sitting back thinking, why do we need to change or improve our website again, we updated it two years ago, the Internet is fluid. Destinations need to be seen as dynamic. Singapore is on its third design (and best so far) in two years.

Develop a plan for your digital tactics and don’t forget basic web marketing tools like SEO and SEM.

Call emergency meetings with all stakeholders – representatives of the mayor’s office from all key cities, transportation companies, travel agents, tour operators, shopping malls, hotels and so on. Identify what each has to offer and work with them to develop an integrated holistic plan to leverage their attributes and match those attributes to the requirements of target markets.

2010 is going to be a bumpy ride for cities, states and other destinations. This is an emergency and it calls for emergency measures.

Otherwise the 30% drop in arrivals in South Africa will be duplicated around South East Asia. And without the attraction of a World Cup, they could be magnified, causing many destinations to have a brutal summer.

Your communications are critical.