conversations. Five pitfalls to avoid

Marketing is more complex than ever before. But Rajeev Batra, the Sebastian S. Kresge Professor of Marketing and Director of Yaffe Center for Persuasive Communication at the University of Michigan, Ross School of Business, tells Prasad Sangameshwaran that the old adage, look before you leap, still holds true.

We are seeing a hypersensitivity to the danger of offending somebody. We have millions and millions of customers out there. Given the new media and the transparency of new media and so on, people will talk all the time. Everybody will not be happy. Something you do might offend somebody and that will lead to sparks. Unless you do something egregious and terrible and it blows up massively, I think companies just need to take a deep breath and not worry too much. It’s not as if people did not say bad things about the brand before. Before social media, there was word of mouth. If people did not like a brand, they told their friends. That still happens, except that this time it gets magnified. You can track it somehow through sentiment measures, twitter commentary and things like that.

I think some companies are over-reacting and over-investing. They don’t need to do that. Having said that, there is certainly more scrutiny by consumers. What you could get away with in the past, you cannot get away with today. So companies have to be more conscious of what they do, because somebody is going to find out.

Efficiency has been an age-old question with the marketing profession. But in new media and social, people do not know what the right metrics are. Many are still experimenting. I think gradually people are getting away from what I call the ‘vanity metrics’ and getting more hard-nosed. That’s a good thing. More than ever before, marketers at all levels, including CMOs, need to become more comfortable with data. The days are gone when you could do back of the envelope calculations and judgement and trust the agencies and surveys and make decisions. That age of innocence is gone. Because if every marketer is striving for efficiency, how can you not be comfortable with numbers? That being said, the numbers just give you indication of cost per click, cost per thousand and so on. But you still need judgement of what is the right metrics. You need to go beyond efficiency to effectiveness. You cannot drown in numbers. You need to be sure of what is the right number we need to use. That still requires old-fashioned judgement. People who are too close to the data sometimes lose track of it.

There is a lot of buzz these days about real time marketing. When adversity strikes another business, it could be an opportunity for you to use your brand in a positive way. Companies jump on to this. But there is a danger there. You have to be genuine. You cannot be seen to be taking advantage of someone else’s misfortune. There have been many cases when companies had to take a lot of flak and push back when it became apparent to the world that this is just clever marketing but not genuine empathy for someone else. There was Kraft which had a product in America called Macaroni and Cheese. I do not remember the exact thing. But they shipped truckloads of Mac and Cheese to somebody, but the amount of money they spent in publicising what they were doing was more than the value of food that they were giving away, which is clearly a case that it was done for marketing reasons and not for genuine reasons. There was a lot of negative sentiments generated by that.

We all know that the pace of change has picked up. So all products and business models are in danger than before. Consumer lifestyles are changing. Expectations are changing more rapidly than ever before. Companies are more concerned about the uncertain future and the pace of change. Innovation is being pushed. But companies are also concerned about predicting the future. The first question is about how the market demand changes, how the nature of the customer will change. In automobiles, the premise that all households will buy multiple cars is changing. Car-sharing is growing as a model in the West. Young customers are not buying cars because their parents used to buy cars at a certain age. There is also a technology change in that industry from diesel and petrol to electric and hybrid. That’s one sector where it’s hard to predict how things will shape up 10 years from now. Technology and telecommunications, we all know how things are changing.

The main thing to avoid is being swept away by trying to mimic what others are doing. We certainly see that in how everybody uses new media. That’s the best example where everybody copies everybody else because there is this fear of being left behind. I am not saying you do not need to follow competition or consumer trends. Yes, you need to know what they are doing. But think a little. We just need to be critical and not jump into something.

Boards need to be a lot more patient with their CMOs because, otherwise, you are encouraging the use of many short-term metrics. That’s not a good solution. Think through the needs of the business and the brand. Make sure you have put the right metrics and objectives in place. That will take time. Once you have that, then you can assign the appropriate time frame to each of your objectives. If you put pressure of quick returns, then you will have short-term tactics that have vanity value but no long-term meaningful business building strategies.

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