Being an enterprising musician, he penned a tune about it and recorded a video which he put on YouTube, which was seen more than 10 million times, and the stock dropped in the next few months 10%. Analysts wondered whether it had to do with Dave Carroll and his video.
Brendan: That’s got to drive marketers crazy, because that’s not really something they can control. McDonald’s Corporation (NYSE:MCD), they had a bit of an issue with something they could control, though. What was their problem?
Doug: Well, what marketers can do is have what they’re saying being in sync with the actual experience, and even more specifically, what they believe. McDonald’s Corporation (NYSE:MCD) is a great example of a disconnect between that. It really didn’t even need to be that way.
McDonald’s Corporation (NYSE:MCD) asked people to share actual stories of the experience that people had in the restaurants expecting, I believe, these nicely packaged beautiful stories of what it was like. In reality, they got some of that, but they also got people talking about dirty Band-Aids in their food and other gross stuff like that, much to their dismay.
Brendan: You kind of wonder how that one made it out of the vetting process …
Let’s talk about the Internet. We talked about it a little bit earlier. How responsible do you think it is for bringing in this Relationship Era, Facebook specifically? Do you think Facebook can take advantage of this? Do you think they’ll have to change the way they have their advertising model right now?
Doug: The Internet’s changed things considerably. Another way that marketers have grown up is thinking about marketing as spin. In fact, marketing is often synonymous with spin. “Put your best foot forward. Show customers what you want them to see.”
Well, now with the Internet — Google in particular — customers can see anything and everything, so marketers no longer have that luxury of just being able to show the things that they want.
The other aspect of the Internet that’s changed things so dramatically is social media. The explosion of social media has made it so that people’s actual experiences get shared much more quickly, with much more volume, than ever before.
Brendan: Do you think there’s one particular medium, be it TV, Internet, maybe even direct communication, that companies can best use in this Relationship Era in order to take advantage of their marketing?
Doug: I do think that social media becomes a great mechanism for marketers in this new era, and they need to use it differently than they’re used to using other media. It’s not a mechanism best used to broadcast a message about a product. In fact, that’s how marketers typically operate. They’re talking about what they do.
What we advise marketers to do, in the book and through our agency, MEplusYOU, is take a step back and get clear on why you exist, what your reason for being is, what the world would lose if you disappeared, what you believe, what you stand for.
When a marketer is clear on those things, social media becomes a great way to connect with like-minded people. Really, the whole construct of marketing is less about, “How do we go out and influence people?” and more about, “How do we get clear on what we stand for and attract people who are like-minded?”
Brendan: You cite the Brand Sustainability Map in your book. Could you talk about what that is, and some examples of companies that get high and low marks on that one in particular?
Doug: You bet. First, companies are used to thinking about and measuring transaction; the degree to which people are buying from them.
They often talk about trust, but talk about trust in a way that’s very different from our own understanding of trust. They talk about trust as a means to an end, a way to grease the skids for transaction.
I believe thinking of trust as a means for garnering more transaction is like thinking of a child as another tax deduction, right? It’s more than that. The beauty of the Brand Sustainability Map is that it takes those two factors of trust and transaction, and acknowledges them as distinct factors that you can look at and measure.
You can look at some companies that do particularly well on that, like Target or Amazon; companies that maybe not everybody has such a strong connection to, or a love of, but at least some people do have a love of.
USAA is another great example of a company that isn’t intending to reach everyone or have a deep relationship with everyone; they’re focused on the military and military families, and they have love among that group. That would be in the upper right, Sustainable Relationship quadrant.
If you move to the lower left, Limited Relationship quadrant, you have American Airlines. American Airlines has had a slogan, “We know why you fly,” which is such a great example of marketing B.S. It doesn’t seem to enter into the way they make decisions or think.
Brendan: You’re also on the board of Conscious Capitalism. Let’s talk about how this fits in with that movement. Obviously, big companies — Whole Foods, Starbucks, Southwest Airlines, you mentioned Panera — are active in that movement.
If you had to boil it down, maybe purpose over profit, how does this book and the Relationship Era fit into Conscious Capitalism?
Doug: To boil down Conscious Capitalism, certainly there’s an orientation around purpose. There’s also an orientation around profit …
Brendan: You have to have profit, right?
Doug: You have to have profit, and in fact profit is not an end unto itself. It’s the result of sustainable relationships. The companies that get that tend to have the greatest level of profit.
This book, Can’t Buy Me Like, maps it directly to the principles of Conscious Capitalism; the idea that when you start with that clarity of what you believe and what you stand for, great things happen. You have loyal customers, you have engaged employees, you have happy investors. That’s really the essence of what we’re talking about.
In fact, this book is the application of the principles of Conscious Capitalism, specifically to the relationship between a company and a customer.
Brendan: One of the things that we don’t like at The Motley Fool is we think a lot of companies are too short-term focused instead of long-term focused. Is that what you find when looking at marketing and the way marketers think? Are they too focused on getting people in the door right now, and not necessarily making them a customer for the long period?
Doug: Without a doubt. The average tenure of a Chief Marketing Officer is around two years. The average CEO is thinking about this quarter, so no doubt marketers are putting a lot of attention toward the short term.
What they may not realize is that even in the short term, if they don’t have trust in the relationships with customers, they’re spending more money. They’re spending more money discounting and promoting — so making less revenue — because they’re having to discount, and therefore making less profit.
They’re also spending more money on paid media because they don’t have that group of loyal customers that are out there actively advocating for their brand. By increasing the level of trust among their customer base, they have an opportunity to spend less and to generate greater profit.
Brendan: It’s an excellent book, Can’t Buy Me Like. Thank you so much for your time.
Doug: I enjoyed the conversation, Brendan. Thank you.
The article The New Era of Advertising originally appeared on Fool.com and is written by Brendan Byrnes.
Brendan Byrnes has no position in any stocks mentioned. The Motley Fool recommends Google, McDonald’s, and Panera Bread (NASDAQ:PNRA). The Motley Fool owns shares of Citigroup Inc (NYSE:C) , Google, McDonald’s, and Panera Bread.
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