Tap into Your Super-Consumers
8:39 AM Wednesday November 25, 2009 
by Eddie Yoon

In any product category, roughly 10% of the consumers account for more than 50% of the profits. These super-consumers, as we call them, are the hot dog buyers who eat five pounds of hot dogs a month, wolfing down as many as 4 per sitting. They are the stapler users who own 8 different staplers. They know what they want, they’ll buy a lot of it, and they’ll pay a premium for it. They’re passionate and engaged — sometimes even a little obsessive — and they exist in every category, from soft drinks and air travel to fast-food and oral care products. Many managers assume that their super-consumers are a unique species whose extreme appetites say little about what more casual consumers might go for. They also figure that their super-consumers are already sated, so there’s no point in probing them further. That’s a mistake.

We’ve found that companies that listen to their super-consumers and use their insights to refine their message ultimately grow sales and margins across all segments. These companies aren’t trying to convert light users into heavy users. Rather, they’re figuring out what it is the super-consumers like so much and then offering it to them. Invariably, acting on the insights from those consumers who spend disproportionate time and energy in the category uncovers insights and innovations that encourage trade-up behaviors across other segments as well.

Consider this: A stapler company we consulted for found itself heading for a price war with competitors. What to do? Market research with its community of stapler groupies — users who stapled ten times as much as the average person — found that they valued anti-jamming above all other features, and would happily pay a premium for high-performance, jam-free staplers. Running with this insight, the company redesigned its point of sale to emphasize electric staplers and refocused its marketing message across all products on benefits (like reliability) rather than features (like color). The strategy boosted sales by 20% and improved margins overall. Not only did electric stapler sales increase (fueled by super-consumers), but the merchandizing strategy emphasizing the benefits of trading up increased sales of heavy-duty manual staplers across other segments.

Or consider how a refrigerated-meat manufacturer used super-consumer feedback to develop a fuller understanding of its true core customers — teenage boys and their moms. Their heaviest users, they found, were not summertime backyard grillers, as they’d thought, but households with teenage boys who eat hot dogs for after school snacks. The boys liked the taste of the all-beef products, and how filling and easy to cook they were. The moms liked their quality (certainly compared to the junk teenage boys normally eat). Armed with this insight, the manufacturer focused its portfolio strategy on all-beef products, emphasized taste at point of sale, and shifted its marketing to extreme sports and gaming environments to build awareness among teen boys — who’d push their moms to buy the brand.

While these decisions were grounded in the insights of the super-consumers, the strategy ultimately paid off across all segments. The brand grew over 40% in three years, increased its share of household penetration and successfully usurped the number one position in the category. While super-consumers accounted for more than 40% of that growth, those weekend backyard grillers drove a nearly equal percentage, with the remaining 20% realized through category expansion. Delivering the optimal product to super-consumers was certainly the primary goal, but in the process the brand succeeded in commanding a price premium and encouraging trade-up behavior across other segments as well.

Has your company tapped the wisdom of its super-consumers? Are you willing to listen to them — and respond? 



Eddie Yoon is a Principal with The Cambridge Group. During his more than ten year tenure with the firm he has helped global clients across industries leverage super-consumer insights to fuel profitable growth.

This post is originally from HarvardBusiness.org and can be found here.

9:00 AM Friday November 13, 2009
ANDREW MCAFEE

You’ve probably heard by now that “your brand is no longer yours.” The assertion’s based on simple math. In the era of blogs, discussion boards, Facebook, Twitter, and other Web 2.0 tools, virtually everyone can get online and talk about your company and its offerings. As a result, the amount of information your marketing and PR departments can generate is only a small percentage of the total volume of content on the Internet about your firm.

What’s more, if some of the external voices become as popular, or perish the thought, more popular than your official voice, then they’re going to show up high in organic (as opposed to paid) search results. For example, I just typed “Hummer” into Google. The second result is the Wikipedia entry about the vehicle, and the fourth one is a site full of user-submitted photos that are not likely to please the brand’s owner.

Every large organization I’m aware of is highly sensitive about its brand, and few are happy about losing or even sharing control over it. They react to the reality of Web 2.0 era in many ways, but most of them amount to some form of trying to exert or reestablish control. Some move their mass media campaigns online to counteract the outside conversation. Some try to influence the influential external voices. Many companies monitor the new online conversations, and also participate in them by setting up official Facebook fan pages, Twitter accounts, and so on. More than a few try “sock puppeting” or having someone on the payroll pose as an outsider with nothing but good things to say. This rarely works; Web users are reasonably good at sniffing out inauthentic voices and ignoring or blowing the whistle on them.

A few large, brand-sensitive organizations have taken another approach; they’ve accepted their lack of brand control and have actively encouraged insiders to join the online conversation without making any attempt to censor or even guide them. They’ve said, essentially, “You know us really well. Talk about us on the Web. We want the world to hear what you have to say.”

Does that sound risky to you? Can you envision dozens of ways in which that approach can go horribly wrong? Me, too. And yet, I keep reading stories like the recent one in the New York Times about MIT’s student bloggers, and they make me appreciate the brilliance of this approach.

Five years ago Ben Jones, then the director of communications in MIT’s admissions office, added a single student blog to the office’s web page; there are now eleven of them. Student bloggers are selected after submitting writing samples, and are paid $10 per hour.

I was an undergrad at MIT (just a few years before the blog era) and I assure you that most students there would treat the administration’s suggestions about appropriate self-expression about the same way Roger Federer might treat the local club pro’s tips on improving his forehand. The admissions office understands this, and wisely doesn’t try to edit posts or comments.

And not all content reflects glowingly on the institution. One blogger complained about problems with the resident advising system, while another wrote that she’s felt several times that she didn’t fit in at MIT. She also went on to say, as the Times story reports, that “MIT is the closest you can get to living on the Internet…IT IS SO TRUE. Love. It. So. Much.”

MIT could spend lots of money on their brand and image and never come up with a better advertising tag line than “The closest you can get to living on the Internet.” Indeed, part of what makes it so effective is not just its clarity and cleverness, but the fact that it’s being shouted across the Internet by a current student who is clearly speaking in her own voice. It’s just tremendous marketing; the admissions office couldn’t ask for, or pay for better.

Putting student blogs front and center is a mark of MIT’s confidence: confidence in itself as a healthy organization where the pros outweigh the cons, confidence in the members of its community who represent it to the world, and confidence that the people who come to its website will know how to interpret the information they find there. According to the Times article, potential applicants to the university are “less interested in official messages and statistics than in first-hand narratives and direct interaction with current students.” Does that sound at all like your customers?

Is your organization as confident as MIT? Are you ready and willing to let more internal voices communicate and shape your brand over time? If not, why not? Is it that you don’t trust your people, or your customers? Is it that you don’t want any negativity at all to appear on your digital properties? Or is it that you’re afraid there might be too much negativity?

I don’t think these are unfair questions, or trivial ones. Their answers will reveal not only how your organization sees itself, but also about how it’s responding to a world of reduced control over brands, conversations, and messages. Leading organizations are embracing this trend and, like MIT, they’re giving up tight control even when and where they don’t have to.

Lagging organizations are holding on to the illusion that tight control is still possible.

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The original post is from the Harvard Business Review and can be found here. It was written by Andrew McAfee. Andrew McAfee studies the ways that information technology (IT) affects businesses and business as a whole. His research investigates how IT changes the way companies perform, organize themselves, and compete. He coined the phrase “Enterprise 2.0” in a spring 2006 Sloan Management Review article to describe the use of Web 2.0 tools and approaches by businesses. He also began blogging at that time, both about Enterprise 2.0 and about his other research. He also maintains a Facebook profile and Twitter account.

McAfee is currently a principal research scientist at the Center for Digital Business in the MIT Sloan School of Management, and a fellow at the Harvard’s Berkman Center for Internet and Society.

He received his Doctorate from Harvard Business School, and completed two Master of Science and two Bachelor of Science degrees at MIT. McAfee is the author of Enterprise 2.0: New Collaborative Tools for Your Organization’s Toughest Challenges (2009, Harvard Business Press).

By Anthony Tjan via harvardbusiness.org.

I recently sat down with my BlackBerry voice recorder and Mats Lederhausen to ask him to share his philosophy of “purpose bigger than product.” Mats is a great entrepreneur and also had one of the most successful careers at McDonald’s where he was a driving force for its turnaround. He currently runs his private investment vehicle Be-Cause and is a Special Partner at our firm, Cue Ball.

What is your philosophy of “purpose bigger than product” all about?

At its core, it is about being real and idea-driven. Trust is perhaps the most important currency in business, and big ideas may be the only true source of competitive advantage. Lack of trust is a form of tax. And that tax rate has increased in the past number of years. Customers simply don’t trust institutions as much today. Particularly large businesses. The main reason is that we now live in an “information everywhere” and more transparent world. Every customer has a camera in their cell phone, a Facebook in their pocket and Twitter at their fingertips. This means we hear and see evidence of businesses not walking their talk. Their products don’t match their promise. In order to regain this trust you must simply make sure that all your products, your merchandising, your advertising, your people and the totality of your touch points with consumers sing from the same hymn. And that hymn is what I call purpose. Some people call it vision. Others call it focus. It is the same thing. It is source of your promise. It answers the question: Why are you here?

Talk a little more on the notion of “big ideas.”

I often talk about “altitude creates attitude”. When you meet people that have a big idea it is almost impossible to be unaffected. It is like a perfume. You can smell it miles away. I firmly believe that the source of human energy and creativity can be found in the distance between where we are and where we’d like to be. It is that creative dissonance that is the entrepreneurial rocket fuel. If human beings could have walked everywhere on the planet I don’t believe we would have invented trains, planes and automobiles. So, if you really want to build great companies you need big ideas.

Certainly, not all big ideas may be viable in all incarnations. What about the reality of these ideas?

Of course they have to be believable. They can’t be pipedreams. Or as John Naisbitt once said: You can’t get so far ahead of the parade that no one knows you’re in it.

From an execution perspective, you have to think big, start small, and scale fast. You can’t think big and start big, that’s almost impossible. You need miniature versions of your grand idea so you can validate its parts, and then iterate and tweak constantly. There’s nothing wrong with having a really big idea and launching only aspects of that idea. Rome wasn’t built in a day. Take Chipotle, for example. Steve Ells had a very big idea about food, but he didn’t start by executing 100% of his vision; he gradually did what he could towards that theme.

It is also important to remember that your purpose is not what you “tell” customers, but what you do. The best way to disappoint everyone is to over-promise and under-deliver. Therefore you must be humble AND committed at the same time. In fact, customers are more forgiving when you make mistakes if those mistakes are honest efforts in trying to improve towards a known and worthwhile direction.

How can a purpose be instrumental in leading an organization?

I look at purpose as the guiding star. The compass. The soul. Steve Jobs once said “Design is the fundamental soul of a man-made creation”. And everything we do is design in one form or the other. And if you have a fuzzy idea of your own soul, your design will suffer. On the other hand, like Steve Jobs does, if you have a sharp idea of your soul and what footprints you want to leave, all your design will complement and reinforce that soul of yours.

How did you come to have this philosophy?

There are a few parts of the answer. First, to be honest, it’s hard to know the answers to the bigger questions in life, like why we believe what we believe. To a certain extent it’s the result of the sum of all of our experiences since birth. Second, I’ve been influenced by seeing what really works. I think strong conviction and a sense of purpose enables focus, and the biggest culprit of bad performance in a company is lack of focus. It’s hard to set direction if you don’t know who you are. Thirdly, I’ve decided that I only want to work with companies that are trying to do something important. It’s about human progress and adding value to society.

What do mean when you say “important?”

While we have significant global issues to be concerned about, an important business doesn’t have to be grandiose or socially driven in order to be important. General contribution to the well-being of another human being is worthwhile. It could be a restaurant that’s creating jobs and leaving customers just a tad bit happier than when they arrived. Or a concept such as MiniLuxe, our Cue Ball investment that is trying to “Starbuck” the nail salon, which has innovated a lot around hygiene and customer experience. It is an example of a business with a clear purpose that is trying to do something remarkably better than the industry norm.

What companies really celebrate this philosophy?

Nike is a company that understands it. They have always had this idea that it’s more than a sneaker. They are about getting into the game, being more than a spectator in life, and embracing activity. In their words, “Just do it.” If you go to their headquarters in Oregon, it’s like being in a gym: it breathes “active lifestyle.” That’s what they’re about and they have consistently executed around it.

Southwest Airlines is about giving people the freedom to fly. They are about seeking and loving freedom, and they enjoy being a bit nutty about celebrating that notion. And there are many others as well. Apple, Berkshire Hathaway, Microsoft, Google, Patagonia, IKEA, and a host of others. There is one thing that is interesting to me to note about all these companies. They are very different in so many ways. But they are also very similar in one way. They all have their founders alive and kicking. When the source of the original idea is still around it is harder to lose why you came to this world in the first place.

According to Webster’s Dictionary the word improvise means “to compose, recite, play, or sing extemporaneously; to make, invent, or arrange offhand; to make or fabricate out of what is conveniently on hand“. I actually prefer the definition of improvisation that Wikipedia provides though. According to Wikipedia, improvisation is “the practice of acting and reacting, of making and creating, in the moment and in response to the stimulus of ones immediate environment. This can result in the invention of new thought patterns, new practices, new structures or symbols and/or new ways to act. This invention cycle occurs most effectively when the practitioner has a thorough intuitive or technical understanding of the necessary skills and concerns within the improvised domain.” Wow, now that’s a definition! But what I love about this definition is that it recognizes the link between the response to the immediateenvironment and the invention of new thought patterns. In short, it recognizes that improvisation and innovation are intimately linked.

Most people associate improv with acting or comedy. But, you don’t have to be an actor or a comedian to apply improvisation to your work. In fact, I think there is more opportunity for improvisation in the professional world than most people think. Gary LaBranche of the Association Forum of Chicagoland says:

“Board meetings and committee meetings, dialogue with colleagues and other everyday situations give professionals plenty of opportunities for improvisational responses. Improv is all about adapting to constant change and unexpected situations, which is familiar territory for most professionals.”

I think Gary’s statement is right on the money. We have more opportunities to use improv as professionals than we realize. In fact, a few weeks ago, I wrote about Pixar and their use of improv in their creative process. Pixar boils down their use of improv to two essential principles:

1. Accept every offer. You don’t know where that offer is going to go. But one thing is for sure: If you don’t accept that offer, it’s going nowhere! So you have a sure thing on one hand: a dead end. And you have possibility on the other.

2. Make you partner look good. That means that everybody on your team is going to try to make you look good and vice versa. It’s about saying “Here’s where I’m starting. What can I do with this?”.

I think Pixar was able to break down their use of Improv into these two principles because of their long, shared experience with improv. I like these two essentials principles of improvisation for innovation, but wanted to expand on a few other principles for teams and organizations that are just starting to experiment or have never used improv before. So, to add to Pixar’s principles, I would advise those new at improv think about these as well:

1. Keep questioning what works. Good is the enemy of great. When something is really awful, we know we need to fix it, and we usually do. But when something is good, we settle. We don’t necessarily think about how we can make it better. So, take a look at what you do everyday. Consider the things that are good and ask yourself or your team “Can this be better?”

2. Be a risk taker and take chances. Sure, you can do things the way you’ve always done it. And you’ll probably get predictable results and that might be good enough for you. But if you want to be innovative, you need to break through barriers, take risks, take chances. You may not always be successful when you take chances, but if you don’t, you won’t ever have the chance to really innovate. The most innovative companies and creative people have failed more than they have succeeded. But, when they did succeed, it’s been with market-changing and world-changing innovations.

3. Always be changed by what is said and what happens. Innovative people and innovative teams always uncover new information. But more than uncovering new information, they learn to react to that new information. Instead of locking up when change comes along, these innovative people let that change inspire new ideas and let what unfolds next guide them on. They welcome and thrive on change. And they allow themselves to be changed. They have the beginner’s mind and are always able to learn and change.

4. Create shared, dynamic plans and agendas. The best laid plans of mice and men often go awry right? We’ve all heard that a thousand times before. So, why stick to a plan that is going awry? The answer…DON’T. Abandon them to serve the reality of what is right there in front of you. That’s right, ABANDONthem. Let your plans and agendas emerge in real-time in response to what’s right there in front of you.

5. Be fully present and engaged. So, you get your team to abandon static, concrete plans. You’ve gotten out of planning and into being. But, this comes with a caveat. To do this, your team has to be completely engaged and have their attention completely focussed. You have to always be ready and able to ask the question “Yes and?“. You have to be engaged and present to always be asking this question.

6. Keep moving forward. When you’re constantly in the flow of improv and innovation, you can’t stop to analyze. It slows you down and stifles creativity. When something unexpected happens, take advantage of this new situation and move forward with it. If something goes wrong, learn the lesson and move forward. The whole idea is to keep moving forward. The road behind you is not the road that leads to innovation. Keep moving forward.

7. Understand the good of the whole. When you personally understand what is good for the whole, you have a deeper understanding of when to hang back, when to grab the reigns and how to grab them, and how to support the other members of your team. When the whole team has this attitude and understanding, it creates a truly collaborative, improvisational environment.

8. Lose control. We don’t want anyone on our team to be the star or orchestrator. We want to make sure that no one gets into the “controlling mind“. As soon as one person assumes control or seeks the spotlight, the creativity, improv, and innovation of the team suffers. We need to lose the control aspect of the team and allow everyone to respond to the moment.

9. Self-organize. Creativity is naturally a self organizing system. Teams that allow themselves to explore and play find this self-organization with ease. The team may set some very basic guidelines of play, but once they do, their roles and organization emerge naturally and creativity flourishes. This type of self-organization allows all kinds of things to be possible.

From my own personal experience, the most innovative teams I’ve ever worked on embraced these basic principles of improv. In fact, a few years ago, I worked on a truly creative, innovative team. That team always asked the question “What else can we do with this?”. We opened our minds to all possibilities. There were many times we said, “We’ve never done this before”. Often, we had no idea how the idea would play out. But we always accepted the offer to see where it would go. Sometimes we failed. But, we learned and moved on. And, when we were successful, we produced some of the most innovative software the mapping world had ever seen. I don’t think we ever tried to be improvisational or purposely forced these improv principles. It emerged naturally on a team full of incredible talent with no egos, and I think that made all the difference in the world.

This is reposted with permission from Chris Spagnuolo. The original post can be found here.

Here’s an article from AdWeek and my good friend Mr. Martin Bihl. One of the smartest people I’ve ever had the pleasure of working with.

Words of wisdom from the Wall Street Journal

BBDO’s Andrew Robertson and Others on the Challenges Facing the Industry

By Michael Bush ??Published: September 22, 2008

NEW YORK (AdAge.com) — To no one’s surprise, the first topic of discussion at Advertising Week’s CNBC CEO Summit was the meltdown of the financial markets last week.

“You can’t talk about the impact in general terms,” Andrew Robertson, president-CEO of BBDO Worldwide, told the nearly packed PricewaterhouseCoopers Auditorium in Midtown Manhattan this morning. “You have to look at it on a client-by-client basis. But there are definitely clients where the emphasis is going to switch, and there will be clients for whom the value message is going to become a much bigger component of the overall messaging mix, because that’s something that’s going to be pretty motivating to consumers.”

Moderated by CNBC anchor Maria Bartiromo, the panel, made up of Mr. Robertson; Nick Brien, CEO of Mediabrands; Sarah Fay, CEO of Aegis Media North America; and Irwin Gotlieb, CEO of Group M, discussed a variety of topics, but the fallout from last week’s financial mess was never far from top of mind.

‘Best-case scenario’

“I’m not sure how consumers will react to this,” Mr. Gotlieb said. “At the moment I don’t think the consumer can comprehend what has just happened. The best-case scenario is that the consumer doesn’t comprehend what went on and goes on merrily about their way.”

He said regardless of a person’s ability to fully comprehend what transpired, consumer confidence has a way of coming back. “There is quite a bit of elasticity in consumer confidence, and it does tend to bounce back, whether the situation is understandable or not,” he said.

Ms. Fay said one of the questions was just how big an impact Wall Street’s woes will have on ad budgets. She said her advertising media company has “just rounded down” its 2008 growth forecast, from 6% to 4.9%.

Mr. Brien said of the financial crisis: “Between natural-resource prices, the housing market, what’s happening on Wall Street as well as technology and its impact on marketing, it’s a more challenging environment in terms of turning suspects into prospects into buyers,” he said. “It’s going to challenge the professionalism of everything we do.”

Fundamental shift

The panelists also discussed the evolving nature of the marketing business, the need for more integration across disciplines and the growing relevance of data such as consumer behavior when it comes to constructing a campaign.

“The nature of marketing is going to be less about the vehicles we choose to target and how we use those vehicles,” Mr. Brien said. “It’s going to be more about the fact that we need to refine the persuasion-based activities we have all grown up with with user influence. This balance is going to challenge agency structures.”

Mr. Robertson called this the fundamental shift that people need to start recognizing in order to reach consumers.

“We have to stop thinking of media as bridges that we march messages over into people’s minds and start thinking about creating experiences that change behavior and providing access to those experiences in the most relevant places,” Mr. Robertson said. “That’s a different language and different way of thinking from the way the business was approached even three years ago.”

Consumers behavior

“Rightly or wrongly, the consumer trusts their peers more than they trust some of the most recognized publications,” Mr. Gotlieb said. “And because of that the communications today are not just about talking at the consumer. It’s about managing their perception and trying to get them to participate in the discussion in a way that is favorable to your client. The challenge is none of us can do all of these things. What we have to get to is a single, integrated strategy that can be implemented by multiple entities. None of us has the ability to implement all of the components of that strategy.”

Mr. Robertson said the only thing that matters to him is consumer behavior, and marketers should focus on creating experiences to change consumer behavior and not so much on messaging.

“We used to think about messages that created a case for a particular behavior,” Mr. Robertson said. “It’s not about that now. It’s about creating experiences that, by participating in them, change consumer behavior. I’m only interested in behavior. Everything else is just a proxy for it. Unless behavior changes, it’s all been a waste of time and money. That’s an important lens through which to look at everything, because there’s a lot of interesting stuff going on, none of which is going to change behavior. And our clients can’t make any money unless behavior changes.”