The 2011 Marketing Tea Party Awards

Last year we issued the first of our eponymous awards to some very worthy winners.

The word Like took honors for Most Annoying Word in the Marketing Lexicon, while Twitter walked away with the Most Overhyped Yet Ineffective Marketing Tool award. And, to nobody’s surprise, Groupon won Bonehead Decision of the Year (for passing on a $6 billion offer from Google).

Although 2011 is only 10/12ths of the way done, we’ve pretty much seen enough (in fact, we’ve seen all we can take), and can confidently call this year’s winners in some newly ordained categories.

The New Coke Award

This year’s winner of the New Coke Award, for the company that commits the worst strategic blunder, is — hands down — Netflix. The firm’s pricing decision and  flip flop on the Qwikster thing resulted in the loss of nearly a million customers and somewhere in the order of $12 billion in market valuation. If you’re Google, that’s no big deal. But to the rest of us in the 99%, that’s a lot of money.

In the age of social media, where gathering feedback from the market and testing marketing (read: pricing) decisions can be done relatively fast and cheap, there’s simply no reason for major strategic blunders like this one.

Now, I know what you’re thinking: Based on the criteria, wouldn’t Bank of America be a close contender? No. They captured a different award:

Credit Union Marketer of the Year

Bank of America, with a single move — that they didn’t even implement — has done more for the credit union industry in one month than credit unions have done for themselves in 100 years. The Great Debit Fee Fiasco of 2011 will be a case study in business schools for years to come.

The circus surrounding an announcement — wait, did they ever really announce it? — is perhaps unprecedented. The number of parties taking credit for the reversal has only just begun. Claiming that they “listened to their customers” as the reason for the reversal only begs the question: Why didn’t they ask their customers BEFORE they made the decision?

Congrats, credit unions. This is your Rocky moment.

Most Overused Word in the Marketing Lexicon

I’m going to go out on a limb and make a prediction: 2011’s most overused word might just repeat the honor in 2012. Whether I’m right or wrong about that, there’s no doubt in my mind that Analytics takes the crown for most overused word in the marketing vocabulary for 2011.

Did you know that when you create a spreadsheet, and populate some cells with formulas that do addition and subtraction, that that’s called Analytics? If you use an Excel function, you might get away with calling it Predictive Analytics. 

Have you ever taken a list of customers and identified those that meet a certain criteria, like under a certain age, or over a certain income level? Congratulations, you’re an Analyst performing Analytics!

Do you create reports for the management team showing them traffic on your firm’s web site? That’s called web analytics.

And there’s certainly no shortage of experts telling us that analytics is the key to competitive success. If you’re not performing predictive analytics on the social media data you’re monitoring and capturing, then you might not still be in business in 5 years.

If analytics was overhyped and overused in 2011, just wait until next year. 2012 will be the year of Big Data. We here at The Marketing Tea Party will be doing our best to make it the year of Right Data. Because what’s one more bruise on the side of our heads from beating it against a brick wall?

—————

Don’t forget to check out Snarketing 2.0:

For the print copy:      For the eBook:

   

Advertisements

I Regret To Inform You That My Blog Fees Will Be Going Up

Many of you have been reading this blog for the 2+ years of its existence for no charge. Well, my little freeloading friends, this is the end of that party.  Beginning December 1, I will be instituting the following fees for reading this blog:

  1. Blog reading fee. Lifetime free readership will no longer be available. Per the terms of our agreement — that the end of anybody’s lifetime allows us to revoke the offer — free readership of this blog will no longer be offered. Starting December 1, you will be charged a $.25 fee for each blog post you read, whether you link directly to the site, view it in a reader, or are simply subscribed to it at the time it was posted.
  2. Subscription reversal fee. Requests to unsubscribe from this blog will be assessed with a $25 premature disconnect service charge. At this time, subscription reversal requests cannot be taken online, as my eCommerce site is currently down for scheduled maintenance. Please mail your requests to the home office address, which can be found on my eCommerce site.
  3. Inactive reader fee. For every week that goes by in which you do NOT read a blog post, you will be assessed a $.50 fee. For any month in which you do not read a single post, a $5 charge will be levied.

In an effort to be transparent, however, I think it’s important that I explain why I’m forced to institute these fees:

1. Higher debit card fees. Starting October 1, new debit card interchange fee regulations took effect. Even though these changes only impact banks with assets greater than $10 billion in assets, I figure that if this excuse works for Redbox, then it should work for me.

2. The Barbara Lee effect. Ms. Lee, a member of the House of Representatives, recently commented that she doesn’t use the self-checkout lanes at supermarkets because  “that’s a job or two or three that’s gone.” If there are more people like her out there — who stop using self-checkout lanes, ATMs (because they take away bank teller jobs), self-service gas stations (because they take away gas pumper jobs), or E-Z pass on the highway (because you know we can’t afford to lose any more toll taker jobs) — then the result will be higher prices for lots of things. In anticipation of this mass lunacy, I’m afraid I have to raise my prices.

—————

In a little more seriousness, there is a message here for marketers.

While I fully support the right of any business in this country to raise its prices, and shoot itself in its foot (or head) by doing so, firms that feel the need to raise prices WITHOUT committing PR suicide must do so with caution, transparency, honesty, and proactive communication.

Redbox’s announcement is shameful. They might have well as blamed foreign currency fluctuations in Uganda. There’s a large financial institution (who shall remain nameless lest they find out I’m blogging about them) that should’ve been a bit more sensitive about how it announced its recent price hikes. I would mention Netflix, but I have a professor/ad agency friend in the LA area who would jump all over any comment I might make about them.

Price changes are lightening rods. You might be able to mute the thunder, but people still see the sky light up. And then like to point at it and talk about it.

Netflixocrites

I can’t even begin to count the number of tweets I’ve seen in the past week or so harping on Netflix’s stock price drop on its announcements of customer attrition and reorganizaton.

Is the firm’s actions the right move or the wrong move?

I don’t know. But I’ll tell you what ticks me off: The number of people who blab on and on about how organizations need to innovate and reinvent themselves and make difficult decisions, and about how bigger isn’t better yada yada yada — and then turn around and blast Netflix for its recent decisions.

Isn’t Netflix doing exactly what many of these people have been advocating ever since they appointed themselves business strategy experts?

These people are nothing but Netflixocrites.

If you have canceled your Netflix subscription, I’ve good news for you: Your decision isn’t a proof point that Netflix made a bad decision.

In Defense Of Netflix

Netflix recently announced that it was jacking up its prices 60% to its existing customers, which — surprise! surprise! — caused nearly every Netflix customer with a Twitter or Facebook to bitch, moan, and complain about it on their social network of choice.

I have a message for Netflix customers: Quit your effing whining.

Netflix was well justified in doing what it did. Here’s why:

1. The CEO took a pay cut in 2010 and has to make it back. In 2009, Reed Hastings made $1 million in salary. In 2010, his salary was cut to a little more than $500k, which is where it stands for 2011. How the hell can he be a titan of industry if he isn’t making a mill per year? He can’t. You have to pay for that, Netflix customers. Sorry.

2. It’s the right thing to do for the country. Netflix’ provision for income taxes in 2010 was 5% of revenue, which came in about $2.1 billion. In other words, it paid out more than $100 million in taxes. If Netflix’s revenue jumps 60% as a result of its price increase — to more than $3.5 billion — than it will pay out roughly $173 million in taxes this year. And that’s good for America, folks.

3. You deserve to pay. If your lazy ass is sitting around watching all those DVDs every day, then you should have to pay for that privilege.

Netflix should have raised its prices by 70%. Enduring a little criticism on Facebook is a small price to pay for making this country a better place.