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Remember the Bill Cosby Show (the one where he played Dr. Huxtable)?

There was a scene in that show that I’ve never forgotten. Cosby is talking to his son and tells him: “I brought you into this world — and I can take you out of it.” 

That’s exactly how I feel about this blog. I brought it into this world, and I can take it out of it. And that’s exactly what I’m planning to do.

This Friday will mark two years to the day that I published this blog’s first post. I did so having made a commitment to myself that I would create a great blog — one that would become a Top 10 Marketing blog.

Not that I had any idea what that really meant. I had no idea what Technorati was, no idea if there was a list of top marketing blogs, and actually had no idea what the top marketing blogs were. When I started this blog two years ago, I wasn’t even reading any blogs.

Needless to say, I failed miserably in achieving my goal. 

And thank God for that. Because if I had really wanted this to become a top 10 blog I would had to have written about a lot of things that I don’t really care about writing about. 

And had I done that, I would have failed at achieving what ultimately was the best outcome of writing this blog: Meeting a lot of people I wouldn’t have met otherwise.  (And that’s why, if you’ve ever contemplated whether or not to create your own blog, you should do so. Forget about all this “personal branding” stuff).

But I did live up to my commitment. In two years, I’ve published 360 posts — one every other day. And I can assure you that a helluva lot of time and effort went into creating those posts. In fact, probably too much time and effort.

And I just can’t maintain that level of time, effort, and — most importantly — the required level of mental energy.

So I’ve decided to commit premeditated blogicide. (Premeditated because I’ve thinking about doing this for a couple of months now). I’m killing this blog. 

Just as I made a commitment to writing this blog, I realize that I will need to make a commitment to not writing it. I’m sure that every day there will be things that will happen, or that I will read about, that will make me want to blog about it. And I’m making a commitment to not write about it. 

If it’s worthy enough, I’ll write it as an Aite Group alert note (which, if you’re interested, is available for free even to non-Aite Group clients). But I’m not going to write about here.

End of post.

End of blog.

Nothing left to do but smile, smile, smile.

About this time last year, I published a list of updated bank slogans for 2008. This year, I’m moving up to the big time and renaming banks altogether. Here’s a partial list of new bank names we need to see:

Old Name                   New Name

NetBank                      NotABank

WaMu                          VaMoose

PFF Bank                     Poof! Bank 

Integrity Bank             DisIntegrated Bank

Hume Bank                 ExHume Bank

Security Pacific Bank   In The Pacific Bank

IndyMac Bank             InDeGround Bank

Downey S&L               Downed S&L

ANB Financial              A Necrophiliac’s Brothel Financial

By the way, if you wondering what these banks have in common, go here.

And if you need help understanding the name of the last bank, go here.

A new marketing organization has been formed that you should take a look at it. It’s called the Participatory Marketing Network. According to its web site:

Over the last 50 years, we have seen marketing evolve from “Push Marketing” to the “Permission Marketing” concepts popularized by Seth Godin. More recently,  industry experts have proclaimed the coming of a new marketing model “Participatory Marketing,” and while their definitions may differ slightly, their concepts are united in their recognition that:

1. We are in the midst of another paradigm shift that calls for new solutions that recognize and embrace consumer control and empowerment.
2. The Internet and technology have fundamentally changed consumer and brand interactions forever.
3. To succeed and build trust today, marketers must advocate for consumers and make them an active and willing participant in the promotional conversation.”

What I like about this concept is that it: 1) recognizes the need to move beyond push and persmission marketing, and 2) frames the model in a way that isn’t simply limited to social media and social networks.  (On the other hand, I hope the network recognizes that just because marketers must meet the “participatory” challenge, it doesn’t mean that they can stop mastering the permission and push models).

The PMN is the brainchild of Michael Della Penna, who was a pioneer in the email marketing field as one of the co-founders of Bigfoot Interactive, and more recently, was Chief Marketing Officer at database marketing firm Epsilon.

Membership provides access to webinars (the first one from Charlene Li, co-author of the best-selling book Groundswell), white papers, and to proprietary Gen Y research that the network is conducting in conjunction with Pace University’s Interactive and Direct Marketing Lab.

There’s also a blog worth checking out.

Technorati Tags: Marketing, Participatory Marketing Network

I have a request: Would the person who first called a rewards programs a “loyalty” program please raise your hand?

Thank you. Now could you come a little closer…..so I can whack you upside the head for causing so much unneeded debate and confusion.

There is no shortage of academic research addressing the question of whether or not loyalty programs actually create, drive, or lead to customer loyalty. Any number of studies prove both sides of the coin — that these programs do drive loyalty, and that they don’t drive loyalty.

Many of these studies conclude that rewards programs either do or don’t work. What they fail to grasp, however, is that rewards programs, in and of themselves, may not be good or bad. Instead, how any one firm implements a rewards program may be the true determinant of success.

But there’s no shortage of rewards programs skeptics, and their mantra is familiar: “You cannot buy customer loyalty, you must earn it.”

Before we move on, let me say right here and now that no one — and I mean no one — believes that mantra more than I do.

But had our newly-smacked-upside-the-head friend not started substituting the word loyalty for rewards, the marketing world might be a more peaceful place.

You see, I could care less if the studies show that rewards programs lead to loyalty or not. To simply focus on the loyalty criteria misses the point. It’s like saying that batters “fail” if they don’t hit a home run every time they’re at bat (I know — ugh, a sports analogy).

My take: Beyond the question of loyalty, there are a number of strategic benefits that firms that effectively implement rewards programs can reap. Rewards programs are tools for:

• Targeting. Marketers spend a ton of money, time, and effort trying to figure out who to market to. Rewards program participation is like wearing a t-shirt with a bullseye on it. For any given product or service category, rewards program enrollment — and even more importantly, active participation — is often an indication of the emotional involvement a customer has with the product category, and maybe even the firm.

• Engagement. Many firms struggle to find ways to interact with their customers beyond blatant sales pitches that ask them for more business. Just as it is with two people, developing a relationship between a customer and a firm requires some degree of engagement (if you didn’t like the sports analogy, there’s a crude dating analogy that I could make here, but I’ll spare you that pain). Rewards programs are (or I should say, can be) excellent tools to engage customers.

• Selling. Forget whether or not rewards programs drive long-term, lasting loyalty. There’s plenty of evidence that rewards programs can increase sales. At the Loyalty Expo conference that was recently held in Orlando, Luc Bondar and a colleague from Carlson Marketing presented research they conducted that found higher rates of purchase among rewards plan members after they redeem rewards than other rewards program participants.

It’s time to put aside this silly argument of whether or not loyalty programs drive loyalty (and whether or not there are too many programs out there) and focus on the real issue at hand: How to design and implement rewards programs to improve marketing effectiveness and efficiency, and to better engage customers.

Technorati Tags: Marketing, Customer Loyalty, Loyalty Programs, Rewards Programs

Who’s got a higher confidence rating, banks or George Bush?

The good news for banks is that the answer is banks. The bad news for banks is that it’s close.

According to the November Rasmussen poll, 35% of the people polled at least somewhat approve of the way the President has handled his job. That’s actually up 2 points from the October survey.

On the other hand, a new study released by market researcher Morpace found that just 38% of consumers are very confident in the banking industry. And that’s down six percentage points from the firm’s September survey

Given the events that unfolded in the past two months, that’s hardly a surprising finding. But what is noteworthy, though, is the decline in consumers’ confidence with their personal banks. According to the article in Marketing Daily:

“Banks have been rolling out messages of reassurance to current and potential customer alike. According to Morpace’s VP of Customer Loyalty Tom Hartley, ‘What the banks [have been] doing is communicating with customer more, through email, ads and other sources, doesn’t seem to be working in restoring their confidence.”

My take: I agree with Tom 100%.

Plenty of smaller institutions — community banks and credit unions in particular — have seen a nice influx of deposits over the past eight or ten weeks. Why? Because of their “safe and sound” messages? No. Because consumers are spreading out their deposits across institutions.

And quite frankly, I don’t think anyone believes any financial institution that touts how secure it is. Not when the CEO of one acquired firm goes on TV talking up his bank’s “bright future.” Or when another bank runs full page ads in major newspapers telling us how safe it is, only for us to find out more recently that is, well, not so financially secure.

So what should banks do?

1) Ignore the industry surveys. The economy is in the tanks, and FIs seem to be failing left and right. Of course the confidence rating of the industry as a whole is going to fall. Big deal. Your bank’s score is what matters — not the industry’s.

2) Stop trying to advertise your way to a higher confidence rating. Banks will build back their confidence ratings as new and existing customers experience a higher level of service. You cannot advertise your way to greatness.

3) Develop (or re-develop) an onboarding program. As new customers come on board, the key to their long term retention will be made or broken in the next 6 to 12 months. It’s critical for banks to recognize the types of relationships these new customers want to have with them. Are they simply spreading their funds across banks for security or are they abandoning old banks and looking for a new primary bank to have a relationship with? Quit wasting money on newspaper and TV ads, and put it into some marketing analytics efforts to figure out how to grow the relationship with the influx of customers who are coming in the door (thanks to no effort on your part).

4) Stay away from TARP money. (Are you listening credit unions?) I don’t know how, and I don’t know when, but at some point taking TARP money is going to create PR problems for the institutions that took those funds. 

Technorati Tags: Banking, Marketing

Swillboard pre-announced its top 20 songs on Wall Street for 2008. I got a sneak preview, so here they are:

20. Grateful Dead, “Loser”
19. Aerosmith, “Dream On”
18. Allman Brothers Band, “Whipping Post”
17. Beatles, “Help!”
16. Animals, “We Gotta Get Out Of This Place”
15. Bee Gees, “Stayin’ Alive”
14. Patsy Cline, “I Fall To Pieces”
13. Country Joe and The Fish, “The I-Feel-Like-I’m-Fixin’-To-Die Rag”
12. Dixie Hummingbirds, “I’ll Live Again”
11. The Doors, “The End”
10. Bob Dylan, “The Times They Are a-Changin’”
9. Guitar Slim, “The Things That I Used To Do”
8. Jane’s Addiction, “Been Caught Stealin’”
7. Led Zeppelin, “Dazed and Confused”
6. Barry McGuire, “Eve of Destruction”
5. Joni Mitchell, “Help Me (I Think I’m Falling)”
4. The Surfaris, “Wipe Out”
3. Marion Williams, “Packing Up”
2. The Smiths, “Heaven Knows I’m Miserable Now”

And the number one song on Wall Street for 2008:

1. The Temptations, “Ain’t Too Proud to Beg”

Technorati Tags: Wall Street

If I HAD A WEB 2.0 COMPANY…

…that had more than its share of technology issues…

…and no clue about what business model would enable it to actually generate revenue…

…and some firm came along offering me $500 million in stock for my company…

I WOULD SELL IT BEFORE THE ACQUIRER CAME TO ITS SENSES.

But faced with the (well, kinda) same set of circumstances, Twitter decided to pass on a $500 million stock offer from Facebook.

Is this a reflection of Twitter’s belief that its worth a lot more than $500 million? Possibly, but I would hope not.

All Things Digital reported:

It’s more about timing,” said one person familiar with Twitter’s motivations. “There is a strong feeling that there is still an opportunity — even with the economic downturn — to blow this thing out.”

One commenter on the site remarked: “In my opinion, the two communities just wouldn’t mesh well.”

Just my opinion, but neither of these views nails the real issue (Facebook can hardly be considered a single community, and the overlap between Facebook and Twitter users is huge, so the commenter is really off-base).

My take: Twitter’s rejection reflects its take on Facebook’s future valuation.

I said this during the dot-com boom eight years ago, and it holds true today: For all these (now Web 2.0) firms to succeed and thrive, advertising is going to have to account for a greater portion of GNP than healthcare and financial services — combined.

And that’s simply not going to happen.

It doesn’t add up. On one hand, to garner a multi-billion dollar valuation, a Web 2.0 firm needs to have mass appeal. But on the other hand, the pundits yell that “mass media advertising is dead!” If shoving advertisements in the face of people on TV, in magazines, and on other Web sites doesn’t work, then why would it work on Facebook?

 Even Google is diversifying its revenue stream, and has seen its licensing revenue (which admittedly only accounts for about 3% of revenue) grow by 2.5 times its 2007 level through just the first three quarters of 2008.

Twitter is making a smart move by passing on this deal. Not because it’s worth more than $500 million today, but because that $500 million might not be worth as much in the future with Facebook as it would be with some other firm.

Technorati Tags: Twitter, Facebook

While there are a lot of things that banks need to do to get back on track profitability-wise, there are three “things” banks need to improve in order to (re-?)gain their credibility with consumers:

• Transparency. If the CEO of your company goes on TV (say, Jim Cramer’s show) and tells the world the future of your firm looks bright, and then two days later, other banks are picking at you like vultures on roadkill, then your firm is not transparent. Consumers (not to mention investors) are sick and tired of this crap. Come clean about your financial situation. And come clean about your product quality. And your fees. Be transparent. We know the difference.

• Tangibility. The Financial Brand blog recently highlighted the branding efforts of one bank, who’s running a series of ads showing someone (as Jeffry Pilcher writes) “wrestling — literally — with some aspect of their financial life: a wallet, purse, or checkbook. The only blurb of copy — the headline — says ‘Take control of your finances.” Pardon my french, but what the hell does that mean? Exactly what, Mr. or Ms. Banker, are you proposing to DO to actually help us “take control”? Aspirational messages are nice, but at some point (uh, sooner rather than later), banks need to be a lot more tangible about delivering on this stuff.

• Competency. Pretty soon, I’m going to get a call from my account manager at my bank, asking me to talk with an adviser from the investment firm that they recently acquired. (This could be any number of banks). My response is going to be “you want me to talk to an adviser from a firm that did such a *great* job managing its own money that it nearly went out of business before you guys scooped them up for 10% of the value they were worth a year earlier?” (This could be any number of investment firms). A bank branch rep I spoke to recently couldn’t even answer basic questions about the changes in FDIC coverage. My point: To improve their reputations, banks (and other FIs) are going to have to re-prove their basic competency regarding financial matters.

The reason I refer to these things as “things” is that I don’t know what else to call them. Measures? Perceptions?

Problem is, I don’t think any bank tracks these “things” today, so how will they really know if they’re improving on them?

Maybe the brand index methodologies out there will tell them. Not likely.

Fixing these “things” isn’t going to come from external measurement. It will happen because the management team will take control of the situation, make fixing their reputation a priority, and do something about it.

Technorati Tags: Banking, Marketing, The Financial Brand

The results from Swillboard are in, and I’m pleased to present the top 10 bands (or musicians) from this election season:

10. The Clash
9. The Obamas and The Papas
8. Dire Straits
7. Bad Company
6. John McColtrane
5. Negativland
4. Barack Sabbath
3. New Order
2. Rage Against The McCain

And the number one band of the election season……

1. Blind Faith

The top songs, in case you were wondering, were Jimi Hendrix’ “Hey Joe (Biden)” and Procol Harum’s “Whiter Shade of Palin.”

Technorati Tags: Barack Obama, John McCain

The past few months have been a turbulent time for the financial services industry. With all that’s going on, I thought I’d give the confused, perplexed, and uninitiated a simple way to figure out who’s who in the industry.

Fundamentally, there are four types of firms in the industry. Those that:

1) Were banks, are still banks, but don’t want to be banks.
2) Weren’t banks, but now want to be banks.
3) Weren’t banks, don’t want to be banks, but tell the regulators that they are banks.
4) Aren’t banks, don’t want to be banks, but are told by regulators that they’re banks.

Firms in Category 1 include Bank of America and JP Morgan Chase who were banks (and still are), but through acquisitions of firms like Bear Stearns and Merrill Lynch (not to mention Countrywide) clearly don’t want to be banks.

We used to know Category 2 firms as investment banking, brokerage, and credit card firms. Everybody from Goldman Sachs to American Express is applying to be a bank, so they too, can get in on the deposits gold rush of  ‘08.

Category 3 firms are sometimes called credit unions. While they tell consumers that they’re not banks, they tell the regulators that they are, so they can get some of that juicy TARP money.

Firms in the fourth category are sometimes known as P2P lenders. Maybe you’ve heard of Prosper and Lending Club. While they say they’re not banks, the regulators aren’t buying that for a New York second.

Any questions?

Technorati Tags: Banks, Credit Unions, TARP

Yo, doods! Got a question for you: What makes for a great social network?

Answer: A manageable, meaningful group of people with a set of shared experiences that helps to create an emotional bond among the network’s participants.

A good social network can’t be too small, nor can it include everyone under the sun. And while a bunch of people brush their teeth everyday, that act isn’t exactly conducive to creating an emotional bond among the people who do it.

I tell you this by way of introducing a new social network on Ning.com. It’s called:

DOODs: Dads Of Only Daughters

While plenty of guys are dads, not all have only daughters. And those of us who do share some common feelings and experiences:

1. Our minds are controlled by a force 1000 times greater than the forces of gravity and nature.
2. We deal — daily — with a level of irrational thought and behavior that tests our sanity.
3. We wouldn’t trade what we have for anything in the world.

What about the moms of only daughters? Well, they can go create their own social network: MOODs. (Members of this group will be the MOODYs, and I’m sure there will be good moods and bad moods).

So, if you qualify, please join this new network and become a DOOD.

Technorati Tags: Social networks, DOODs, Ning.com

My apologies to Seth Godin for stealing the title of one of his recent blog posts. I hope he doesn’t mind. But, hey, I wanted to write about the same thing as he did, and there’s only so many different ways to title it.

There are three lessons marketers should come away with from this election season:

1) Stories matter. Again, apologies to Mr. Godin for stealing from his blog — his first takeaway was “stories really matter.” But my take is slightly different than Seth’s. For me, the stories that matter are the stories that voters told themselves — not the stories told by the candidates.

After all, the story that McCain told — that Obama wasn’t qualified or ready to lead — clearly didn’t connect with a majority of voters. And the story that Obama told — that voting for McCain was like voting for four more years of Bush — clearly didn’t resonate, since more people voted for McCain than voted for Bush in 2004.

Instead, what mattered were the stories that the voters told themselves. Stories about the state of the economy, the direction the country is on and needs to be, and who would be able to fix the economy and put the country back on the right track.

Where did these stories come from? From their research, their discussions, their experiences, their beliefs….from a million different sources and inputs. From a million different things that the candidates had absolutely no control over.

And that’s the lesson: The candidates couldn’t control the stories that voters told themselves, and neither can marketers. Marketers can only create “environments” (online, offline, service channels, etc.) in which customers and prospects can experience the company or product and form their own stories.

2) Engagement matters. If the stories that customers tell themselves are the most important stories, and if those stories come from their experiences, then engaging customers (customer engagement) is the most important thing a marketer can do.

And that was clearly the key to Obama’s victory: His ability to engage — at both a behavioral and emotional level — a large number of voters. Did McCain get the same level of engagement? I doubt it.

But let’s not forget that McCain did (as I mentioned before) get more people to vote for him than voted for Bush four years ago. Which is important because of the third lesson….

3) What you measure matters. A local Boston paper ran a headline today claiming an Obama “landslide.” Bullsh*t. With 52% of the popular vote, Obama’s victory hardly qualifies as an landslide. And McCain did win (at least) 20 states.

On one hand, Republican “marketers” should be proud that they garnered more votes for their candidate than they did in the previous campaign. That’s a measure of success.

On the other hand, however, they should count it as a failure that there were states they carried in 2004 that they lost in 2008.

The lesson for marketers: What’s important to marketers here is the realization that, unlike a political campaign, with marketing campaigns, there is no winner or loser. There is only performance. Absolute campaign performance is one important measure of success. Generating a higher conversion rate in a campaign than a previous campaign is something to celebrate.

But which customers convert or respond is important, too. If marketers aren’t converting customers in their target market — i.e., the right customers — then it’s back to the campaign drawing board.

Technorati Tags: Marketing, Seth Godin

The first thing that Andy Sernovitz, the author of Word Of Mouth Marketing, wants me to tell you is that he sent me his book and asked me to post a review of it online (very tastefully and tactfully, btw). You see, Andy advocates that anyone (or firm) looking for word of mouth marketing should be transparent about who they ask for referrals.

The first thing that I want to tell Andy is that I’m sorry.

Sorry, first, for taking so long to write this review. He sent me the book months ago, and I read it months ago. I’ve just been too lazy to sit down and write the review.

Sorry, second, for not following instructions. Andy asked that I post the review on Amazon, but that’s obviously not what I’m doing.

And sorry, third, for not writing the glowing review that I’m sure that Andy would want (and, as the author of a book myself, what I would want, too).

I do have some critiques I want to level against the book, but first the positives.

Above all, Word Of Mouth Marketing is a very well written book. It’s no minor feat to write a business book that reads as smoothly and as a fast as a novel. It took me four train rides (two into Boston, two out of Boston) to finish the book. Considering that so many business books are poorly written (full of redundant, buzzword-laden sections), this book is a welcome respite.

And please don’t let my foreshadowing of criticism diminish the fact that there a ton of tips for word of mouth marketing tactics that readers will take away from the book.

If they work in  a very small firm, that is.

But I don’t think this book will be particularly helpful to marketers in medium to large organizations. Which would be OK if the book clearly stated that it was intended for marketers in small businesses. But it doesn’t, and in fact, uses big firm examples like Southwest Airlines (which, ironically, is what I’m flying on as I write this).

My criticism of the book centers around two points: 1) over-attribution, and 2) under-integration.

Word Of Mouth Marketing — like, unfortunately, too many other marketing books — suffers from a case of over-attribution: Attributing business results to word of mouth marketing without acknowledging the contribution of other marketing investments.

The references to Southwest Airlines are an example of this. Andy bashes mass media advertising (which seems to be obligatory in today’s marketing books) as being increasingly irrelevant and ineffective. Yet, Southwest Airlines — which is held out as the benefactor of great word of mouth marketing — invests heavily in TV advertising.

And quite effectively, I would bet. It’s series of ads making fun of how other airlines nickel and dime you death is pretty memorable to at least this writer.

In addition, there’s little mention that, of all the airlines, no one has a better on-time record than Southwest Airlines. Do I — and millions of other people — know this from word of mouth? Or from personal experience? And from advertising?

The second issue I had with the book concerned under-integration.

The reality of being a marketer is that, regardless of whether or not mass media advertising is as effective as it once was, few firms will stop advertising in those channels (and, in fact, all non-WOM channels in general).

Marketers in medium to large firms (and perhaps small ones too) need to know, at a minimum: 1) How much should we be spending on WOM relative to what we spend on other channels, and 2) How do we integrate WOM with other marketing tactics?

Maybe I’m being unrealistic in my expectations. But the book promises to talk about the art and science of WOM. All I saw was art. (A search of the Social Science Research Network for “word of mouth” turns up almost 100 studies — none of which were referenced or cited in the book).

Bottom line: While well written and full of good tips for executing WOM tactics, Word Of Mouth Marketing is best suited for marketers in small firms, and less so for those who must manage marketing investments across a variety of channels.

Technorati Tags: Marketing, Word of mouth, WOM, Andy Sernovitz

Please note that in 2009, Halloween will be a federally-mandated holiday.

Under a new law enacted by President Obama, US citizens taller than 6′ 2″ 6′0″ 5′10″ will be required to redistribute their candy to people shorter than 4 feet tall. This new legislation, known as CRAP (Candy Redistribution Allotment Program), will be in effect by October 2009.

(Also note that for intended candy recipients wearing braces in 2009, candy credits will be issued that will enable them to redeem credits for candy in 2010 through 2012.)

According to President Obama, “Tall people currently eat too much candy. My plan is fair and just — hey, even Michelle and I are going to have to give up some of our candy.”

In response to the new legislation, former Speaker of the House Newt Gingrich replied, “There are hundreds of six-foot tall nine-year-olds who won’t benefit under this new plan, and will receive no candy at Halloween.”

Happy Halloween.

Technorati Tags: Halloween, Barack Obama

In introducing an article on its site, Chief Marketer poses some interesting questions:

“What if the United States of America was a brand? As a marketer, what would you do to fix it?”

My take: Judging from the marketing press and blogs that I read, it seems to me that if today’s marketers were in charge of fixing America the brand, the top three initiatives would be:

1) Create a Facebook page.
2) Run a user-generated content contest.
3) Launch a blog.

These initiatives would, of course, be multi-channel efforts, seamlessly integrated with mainstream media efforts like, say, a 30-minute, overly-produced, puff-piece infomercial that would preempt regularly scheduled prime time network programming.

Yep, that should pretty much put America the brand back on course.

Technorati Tags: Marketing, social media, social marketing, Facebook

Hey credit union people, got a question for you: Have you ever googled someone?

Of course you have!

And 10 years ago, did you have any idea what it meant to google someone?

Of course not!

My point: It’s possible to introduce new terminology into the lexicon, and have it stick. And credit unions need to introduce some new language into their vocabulary.

While driving home last night, I heard an ad on the radio for a Boston-area credit union who — like so many other credit unions — was going on and on about the “CU difference” and how it wasn’t a bank, yada, yada. Then came this line:

“Come to [name-of-CU] credit union for all your banking needs.”

How confusing. “We’re not a bank, we’re not a bank” but, “come to us for your banking needs.”

So what do you replace the term “banking” with? Well, I’ll tell you what you don’t replace it with: credit unioning. Bad idea.

Here’s my suggestion: “Come to [name-of-CU] credit union for your personal financial management needs.” Or: “Come to [name-of-CU] credit union to help you manage your financial life.”

Why is this better? Because “banking” is a verb that has a strong transactional connotation. And managing — or better yet, processing — transactions is not the area in which I think most credit unions are trying to differentiate themselves and compete (nor should they be).

Instead, it’s the advice, guidance, and education implicit in the phrase “personal financial management” that I think will help CUs truly differentiate themselves — and prove that there really is a CU difference.

Please note, however, that I didn’t suggest: “”Come to [name-of-CU] credit union for all your financial services needs.” That ain’t gonna fly. There are very few (let me repeat: very few) consumers out there who want to turn to just one firm — let alone a CU — for all of their financial services needs.

If you can come up with a good verb that captures “personal financial management”, let me know. I’ll do my part to help make it a fixture of the financial services lexicon.

Technorati Tags: marketing, credit unions

NetBanker notes that for personal financial management (PFM) sites:

Total September traffic was 1.2 million unique visitors compared to less than 400,000 a year ago. The big three newcomers last year: Mint, Wesabe, and Geezeo saw combined traffic increase by 450,000 users, up nearly three-fold increase from 2007. Geezeo was the star percentage-wise growing more than six-fold. But Mint accounted for three-fourths of the net gain across the existing players with 330,000 more visitors.”

My take: It used to be that come the end of December, we’d make New Year’s resolutions to lose weight, get in shape, stop smoking, etc. The increasing PFM traffic is a reflection of a new resolution to add to the list: Get one’s finances in order (or maybe start budgeting, or something like that).

OK, maybe this isn’t a truly new resolution for some people. But the number of sites that offer PFM functionality is growing, and there’s a confluence of forces coming together to make the firms offering these tools feel like this is their time: 1) the economy sucks; 2) entering account data into the PFM tools is less labor-intensive than in the past; and 3) Gen Yers are coming of age.

The combination of these forces is bringing us the new year a few months early — at least as far as making the PFM resolution is concerned.

Will the online traffic for the PFM continue to see strong growth? Sure. While the number are strong, there are still plenty of people who have yet to make their PFM resolution.

But as I’ve implied in a previous post, raw site traffic is a deceiving measure. The real key to this market is how many people keep to their resolution.

Over time, factor #1 will have a seesaw impact on this market. As the economy improves (which it will, it’s just a matter of when), people will feel less pressure to watch every penny — and be less inclined to use PFM tools.

The impact of factor #2 has a short-term effect. Ease of data entry (through account aggregation) makes it easy for people to start using the tool, but I believe that the gee-whiz impact of graphing and charting everything to death will wear off for many people, leading to diminished use.

Factor #3 is the key to success for the PFM market. Gen Yers display a much stronger desire to manage their finances than Boomers or Seniors did at that age. And research from one of the analyst firms found that a suprisingly high percentage of Gen Yers are already saving for retirement — something a lot few Boomers did at that age.

In the end, the winners in this space will be the ones that help the greatest number of people keep their PFM resolution. Not necessarily the ones with highest site traffic.

Technorati Tags: Marketing, Banking, PFM, NetBanker, Mint, Wesabe, Geezeo

On the 1:1 magazine blog, Mila D’Antonio writes:

“After speaking to several technology vendors at DMA08 last week…it seems as though either marketers plan to focus more on customers, or the vendors are just remaining hopeful. The bottom line is everyone agrees that it’s more important than ever to allocate investments and capital spending on strategies that can be measured in the long term, such as customer relationships.”

My take: OMG!!! Stop the presses!

Please don’t get me wrong — I’m not laughing at Mila, nor am I trying to make fun of her. I don’t doubt for a minute that what she wrote is exactly what she and her colleagues heard at the DMA conference. It’s just that I could told have you the same thing — and I didn’t even attend the show.

How did I know? Can I read minds? Hardly. But I can look back to the past.

I wrote about the “year of the customer” back in January, when NYSE magazine released its CEO survey heralding 2008 as the year of the customer. This came on the heels of e-consultancy forecasting 2007 to be the year of the customer, and SearchCRM suggesting that 2006 could be the year of the customer (after asking in 2004 if that year would be the year of the customer).

Some things don’t ever change, eh?

So here’s my humble request to any journalist writing about the year of the customer or to any organization planning to publish a report proclaiming next year to be the year of the customer: Please ask (and press) marketers to tell you what they plan to do differently. What new investments will they make? What new marketing capabilities will they develop? How will they change their approach to fostering customer relationships? For crying out loud, what will be different?

I can’t wait to hear the answers. There’s nothing more I’d like to do in December 2009 (other than retire) than admit that 2009 really was the year of the customer.

Technorati Tags: Marketing, Year of the Customer, 1:1 magazine

Are you sitting down? Please do — because what I’m going to say might shock you.

My favorite marketing magazine is from the post office.

I don’t just mean that the post office delivers my favorite marketing magazine to me (which it does). I mean that the post office publishes my favorite marketing magazine.

OK, it’s not really the “post office,” but the USPS that publishes it. I’m referring to a magazine called Deliver. This magazine fills a huge hole in the publishing world: A magazine that recognizes that advertising and branding aren’t the only components of what constitutes “marketing,” and a magazine that isn’t narrowly focused on only “new” marketing approaches like social media and Web 2.0.

The old CMO magazine used to fill this void, but, alas, is no longer around, and Pepper & Rogers’ 1:1 magazine is certainly a great publication. But there are a few things about Deliver that makes me look forward to receiving it: 1) Interesting design; 2) Uniqueness of articles; and 3) It’s short and readable.

Check out Deliver.

Technorati Tags: Marketing, Deliver magazine

Someone once said that there are lies, damn lies, and statistics.

Personally, I think that there’s a hierarchy there. Anybody can lie. If you’re good, you can tell a damn lie. But you have to be really good to use statistics. Alas, I don’t think Mint.com makes it to the top tier.

At the Finovate conference in NY, Mint.com presented and shared some numbers that piqued my interest. It claims that it “manages over $12 billion in transactions” and that 50% of its users have changed their spending behavior by using Mint.

Manages transactions? Perhaps “tracks” would be the more accurate word. And how does Mint know that the behavioral changes have come as a result of its tools — and not the general economic conditions?

Then there’s Mint’s boast that it has identified more than $100 million in potential savings for its users. This is ridiculous. Imagine if Capital One claimed that it has provided more that $100 gazillion in consumer financing by adding up the credit lines offered in the marketing offers it has sent to customers and prospects.

And finally, according to its CEO, Mint.com currently has 500,000 users, enjoying a sign up rate that has “more than doubled” in the past 3 weeks.

Sounds pretty impressive. When Aite Group spoke with Mint in April, it had 220,000 users, and (we were told) was signing up 10,000 people each week. In its August 18th press release, it said it had 400,000 users. So in the eight weeks leading up to the Finovate conference, it added 100,000 users. Which, my calculator tells me, is 12,500 users per week, and just 25% more than the weekly rate from April.

I’m not calling Mint.com a liar. I believe that it has doubled its sign up rate. After all, with the economy going the way it has, who isn’t more concerned about managing their finances? It doesn’t surprise me at all that the sign up rate is increasing. The enrollment rate might have dipped during the summer for all I know.

But let’s put Mint.com’s numbers in perspective. It may very well be the largest “online personal finance service.” Online. On Javelin Research’s blog, Mark Schwanhausser implies that there are 9 million Quicken users. If Mint.com grew by 40,000 users per week from here on out, its user base wouldn’t equal the Quicken population until we’re ready to throw the next president out of the White House at the end of October 2012. At 20,000 users per week, the 9 million figure will be attained while you eat your Thanksgiving turkey — in the year 2016.

But this is a silly discussion. Enrollment isn’t the critical statistic — the percent of enrollees that are active users is the critical factor (any online banking exec will tell you that). Intuit will tell you that, too — it has sold a lot of copies of Quicken to people who don’t use it. At least the firm got paid for each copy it sold.

Here’s my request of Mint.com: If you present at the next Finovate, please don’t share BS statistics (that’s not “Bachelor of Science” by the way). Instead, tell us, of the people who have enrolled, how many are active? How many use the site on a daily or weekly basis? How many site features do they use? How many accounts have they aggregated? How does usage change over time? How many of the saving offers that have been presented to users have been accepted? We’d be a lot more interested in finding out how much Mint users have realized in savings from Mint offers — not just those that the site has identified.

The reality of the PFM space is that while money is really really important to us — and getting even more important with the economic uncertainties of the day — the process of managing our money is something that few people want to do, or enjoy doing.

Quicken has succeeded by finding a segment of the population that likes to track, trend, graph, and forecast their financial lives. Mint.com has done a great job of replicating a lot of that functionality, and going beyond Quicken by making it easier to get data in (through aggregation), provide offers for savings, and engage users with its blog.

This segment is small. Mint.com is deluding itself (and trying to delude others) when it says its tools are for the masses, and sites like Wesabe are for the hardcore PFM users.

The key behavioral change that will determine the success of the PFM space is not how many dollars in transactions it “manages.” It’s getting more people to become more disciplined about managing their financial lives. There’s no doubt that tools like those offered by the PFM vendors can help people become more disciplined. But this is not an inconsequential change in behavior. Effecting this behavioral change is as tough as quitting smoking, losing weight, or something like that.

Which PFM site or business model will be the one that is most successful in helping to effect this behavioral change? I have my bet, which I won’t share here. But I will say this — for all of Mint.com’s chest thumping, the PFM game is far from over.

Technorati Tags: Banking, Marketing, Personal Financial Management, Mint.com, Finovate

On his Logic + Emotion blog, David Armano writes:

“…after having some exposure to large organizations, it occurred to me that there is a desire to do more ‘unconventional marketing’ but the machine which is in place is actually ‘conventional’—all the things that have been done in the past. And so as I think about how times are becoming more unconventional—with unpredictable financial markets and political change in the air, I can’t help but think that it’s more important than ever to get serious about what it takes to do these types of initiatives right.  It just doesn’t look like conventional marketing—it’s different. And unconventional times call for unconventional tactics.”

My take: David’s absolutely right — there is definitely a desire among large organizations to do more unconventional marketing. And yes, the machine that’s in place is the conventional machine. But I don’t think David is nailing the real issue on the head here: Unconventional marketing tactics don’t exist in a vacuum.

Marketers who have deployed unconventional marketing tactics — like word of mouth, viral videos, Facebook pages, etc. — talk about the success of those efforts in terms of reach, exposure or hits. And they often compare the cost of the unconventional tactic to what it would have cost to achieve the same reach with conventional tactics. (Example: “The local TV station ran a 2-minute segment on our $10 giveaway. So for the $2,000 we gave away, it would have cost us $20,000 to get that kind of exposure.”)

What’s wrong with this?

1. It doesn’t measure the incremental impact. In other words, we don’t know, of the people who saw the viral video or friended the Facebook page,  how many of these people did not already know about the company or were not already inclined to purchase from the company.

2. There’s no context. Congratulations for signing up 1,000 friends on your Facebook page. The real question is: Were these the right 1,000 people? In other words, are they part of your target market? (You have defined the market you’re going after, right?)

The reality here is that it’s not an either/or situation. Large firms’ desire to do more unconventional marketing doesn’t mean they can (or even want to) completely stop doing conventional marketing things.

While David is right that marketers must “get serious about what it takes to do these (unconventional) types of initiatives right,” there’s an even bigger challenge to meet: How to integrate unconventional tactics with conventional tactics, and determine the right mix (or balance) between the two types.

In his book Word of Mouth Marketing, Andy Sernovitz challenges the effectiveness of traditional forms of advertising (like TV), and highlights Southwest Airlines as a firm that gets WOM right. But this is the same firm that has run a series of memorable TV commercials in which it ridicules other airlines for nickel-and-diming customers to death with fees. So while Southwest has embraced WOM marketing, and perhaps other unconventional tactics, it clearly isn’t throwing the baby out with the bath water.

Bottom line: The marketers — and marketing services agencies — that will be the most successful won’t be those that just get unconventional tactics right. It’ll be those that integrate the unconventional with the conventional (to the point where the unconventional is no longer unconventional) and measure the effectiveness of the entire set of marketing efforts — not just the one-off experiments.

Technorati Tags: Marketing, David Armano, Logic+Emotion

P2P lender Zopa has decided that wiith the leaves falling all around (here in New England, at least), it was time it was on its way. According to Zopa’s site:

While our model is doing very well in current market conditions, the US has been adversely affected in a way that just couldn’t have been predicted when we launched. So, sadly, our US colleagues have decided to withdraw from the US marketplace.”

When I read the words that it told me it made me sad, sad, sad. But on the Forum Solutions site (run by Forum CU, one of Zopa’s US partners), Doug True quotes Sarah Mason from Affinity Plus CU as saying:

As one of the credit unions who were partnered with Zopa, I would like to clarify that we have no credit availability issues and have changed none of our lending practices. This decision was made by Zopa.”

Hmmm. These would appear to be contradictory statements — but you know sometimes words have two meanings.

My take: I have to admit to being a littled dazed and confused. The “current market condition” — i.e., credit crunch — means traditional sources of funding (FI2P, or financial institution to person) is drying up. So, borrowers should be turning to alternatives sources of funds like P2P sites, no?

And with the steep drop in the stock market, investors/lenders are looking for places to put their money that will generate decent returns. So they should be turning to alternatives like P2P sites too, no? And feel even more secure about Zopa, since it’s (or was) backed by solid financial institutions, right?

In the battle for [evermore] customers, increased demand for alternative sources of funds + increased supply of funds available for alternative lending sounds like a stairway to heaven to me.

But apparently not. So what happened? I’m guessing it was a combination of:

1. The market not being ready. According to Forrester Research, consumers show “little interest [in P2P lending], mainly because they are skeptical of the benefits, are concerned about the risks, and are almost completely in the dark about firms that offer these services.”

2. The marketing not being sufficient. The flip side of factor #1 is that Zopa and its partners didn’t put enough marketing horsepower into their efforts. I remember a conversation I had in 2000 with Doug Lebda, founder of LendingTree. Although he believed that having “banks compete over you” was a better value proposition than the prevailing business model, he recognized that what he was asking consumers to change the way they went about getting a loan. And as such, he knew had to commit a lot of marketing dollars in educating consumers about this new approach and to create a new consumer brand.

3. The management team(s) not being able to focus. Management can’t disperse its attention to too many competing initiatives. So Zopa may be making a smart decision to narrow its attention and resources to the markets — namely, the UK and Italy — that promise to be the most profitable in the short term, and help fund its long term growth plans. CU contemplating starting new CUSOs should keep this in mind, too.

Bottom line: I wrote back in May that I thought Zopa had the winning business model in the P2P space. I think the key to P2P success is not through the disintermediation of financial institutions, but leveraging their risk management capabilities. I don’t think Zopa’s departure from the US is a sign that its business model was wrong.

But this should be a wake-up call to the existing players in the P2P market that their “better mousetrap” is no guarantee of success. Some marketing pundits love to say that all the rules of marketing have changed. They’re wrong. Social networks, word-of-mouth marketing, viral videos, etc. are just new ways of creating awareness, interest, and consideration among consumers. The need to manage the customer life cycle (awareness, interest, consideration, purchase) hasn’t changed — and never will.

Many dreams come true — and some have silver linings — but if P2P sites are going to gain any market share, they’ll need to spend a pocketful of gold on marketing.

Technorati Tags: Credit unions, P2P lending, Zopa

Opinion  Research Corporation issued a press release highlighting the results of a survey it recently conducted. According to the release:

“Nearly half of those surveyed (46%) said the bank in which they have the most assets was not communicating with them enough. Mutual funds fared slightly better than banks, with 42 percent of respondents that hold the majority of assets there expressing disappointment in the level of communication from their provider.  Brokerage firms appeared to be doing the best job of keeping their customers informed, with sixty-two percent of respondents that hold the majority of assets there indicating that the level of communication has been good.”

My take: Look on the bright side: A majority of those surveyed (54%) did say that their banks was communicating with them enough. And nearly six in ten respondents said their mutual fund provider was doing a good job of communicating.

The problem here is that we have nothing to compare this to. In normal times, how many consumers think that their bank communicates with them enough? And how do we define “communicate” in this regard? Are blatant marketing messages considered “communication”?

Elizabeth Glagowski of 1to1 magazine was right on with her comment on the 1:1 blog:

“At this point, even a simple mass email or direct mail piece to reassure (or prepare) customers would definitely go a long way. am a customer of many financial institutions. Only one has sent me any type of communication explaining its role in the financial landscape. It really made a difference to me as a customer.”

I did a quick check of the largest banks’ Web sites to see if any had posted a message online. The result: Only a few have posted anything. One example: Wells Fargo.

It’s a shame that few banks have established a blog — each day brings new news (is that redundant?) that is great blog fodder for banks to communicate with their customers about.

It’s too late for banks to start a blog now (for the purpose of communicating about the crisis, not in general). But it’s not too late for them to put up a message on their Web sites (especially with nearly of some banks’ customers coming online to check account balances or pay bills on a regular basis).

Not to take WF to task here, but I would suggest writing a letter a little different from what it published. My suggestion would be to publish a letter that talked a little more about the situation itself. Help customers understand how the industry got into this situation in the first place, why other banks are having trouble and — this is the tricky part — how to know whether or not they should pull their money out of the other banks they do business with.

This last part is the one that most banks will struggle with. With some firms running full-page ads touting their newly superior rates, it leaves one consumer (me) with the impression that they’re vultures picking over the newly killed. Banks have got to recognize that few customers put all their eggs in one basket (or bank), and that consumers have a lot of reasons for doing so. It would be nice for my bank to assure me that the piddly amount of money I putin a CD with the bank across the street from them (which was opened because it offered me a better rate for the next 6 months than my primary bank did) is OK to keep there.

The end result of this financial crisis is not going to be the consolidation of accounts with the banks left standing. It’s going to be the opposite — further dispersion of assets across institutions. We Boomers are already of the mindset that we would never have all of our accounts with one bank. This crisis is going to lead a lot Gen Yers and Xers to feel the same way.

So what should banks be telling their customers? The answer is simple: The truth. The truth about what’s going on in the industry, and what customers should do about it (that’s best for the customer, and not necessarily the bank).

Technorati Tags: Banking, Marketing, Wells Fargo, 1to1 Magazine, Opinion Research Corporation

Update: For more on this, go here and here.

A while back, Christopher Stevenson really raised the bar for us bloggers when he said he was going to start responding to every comment on his blog. Damn. That’s a high bar for someone like me. But I’ve realized recently that I’ve been lax in responding to some comments, and would like to use this blog post to rectify the problem.

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As proof that there is a long tail of blogging, a blog post I published in June 2007 is still generating comments. Responding to a blog post titled Off-Topic:Britney Spears’ New Album, Sally Hilvbaters writes:

“My girlfriend and I want to go on a spectuacular vacation soon. We were looking for advice. Anyone have any great spots? A means to save a little dough would be nice too. Traveling is expensive these days.”

@Sally: Thanks for visiting my site and leaving a comment. You’ve certainly come to the right place for vacation advice. And I know exactly what you mean when you say traveling is expensive these days. Don’t I know it! That’s why I’d recommend that you and your girlfriend stay at the Extended Stay America motel in Danvers, MA. It’s just down the road from Strike One, where you and your girlfriend can spend the day playing pinball and batting in the batting cages. If you’re looking for a great place to eat, there’s a TGI Friday’s about 1/2 mile from there. Enjoy your vacation, and please be sure to let us know what you end up doing.

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I should have anticipated that a blog post about the game show Jeopardy would ferret out the intellegentsia within the blogosphere. AMistyCrissy left me this comment:

“Hello! I’m Crystal. I am almost 19.
I guess marketingroi.wordpress.com – good name for this site!
It is so interestingly here, especially in this category.
I was surfed about 2 hours before found this site. I think i’ll be here for a long time! :-*”

@AMistyCrissy: Thanks for finding my site. I’m really glad you like the name. Here’s a coincidence: It took you 2 hours to find my site, and it took me 2 hours to name my site! Sounds like karma to me. BTW, I can’t take all the credit for it being so interestingly here, the people who read this blog and comment on it (like you) really contribute to that. So glad to hear you’ll be here for a long time.

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And finally, commenting on a blog post I wrote about why so many conferences suck, Kathrynborlandbest replied:

“Recently, my husband started with the potential problem and our relations are deadlocked. After all, I love sex … I encouraged him to go to the doctor, and he is afraid. Maybe someone who will help us, tell of impotence pills and where to buy them anonymously. In advance thank you to all who help!”

@Kathryn: Thanks for commenting. If I didn’t know better, I’d think it was my own wife who left this message, using a pseudonym! But alas, I’m going to have to ask the other readers of this to help out here. I mean, of course I know where to buy impotence pills — but not anonymously.”

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So, there you go. I think I’m all caught up in responding to comments on this blog. I feel a lot better now.

Technorati Tags: Blogging