Punk Marketing: Summary
Posted on May 29, 2008 - Filed Under Book Summaries |
This is an Executive Summary of Punk Marketing, by Richard Laermer and Mark Simmons. It is completely objective and only contains the annotated main ideas of the authors. Feel free to leave your comments, ideas, or critiques regarding the book in the comment section!
Punk Marketing is an in depth look at the way the changes in the communications landscape of mainstream American society are altering marketing. No longer can companies put an ad on network television and hope to completely penetrate their target market. Richard Laermer and Mark Simmons have put together Punk Marketing as a resource guide for anyone seeking to master the new marketing.
They eschew conventional marketing and advocate creative ways to master the onslaught of new advertising mediums such as the internet, product placements in movies and television, video games, text messaging, etc. Ultimately, they promote the idea that the age of corporations dictating their message to a herd of lemming-like consumers is dead. Instead, customers are now hyper-informed and distrusting of traditional advertising. The only way to survive is to become part of the conversation and “Join the Punk Marketing Revolution.”
Prologue
The book starts out under the premise that there is a revolution taking place in the marketing world today. Back in the glory days of the 1990’s agencies were paid based on how much they spent. They were given a 15% cut of the marketing budget. Which means there was only incentive to spend a lot of their client’s money.
Then marketers began holding ad agencies accountable for their time and billing changed to represent actual work done on the account. Sooner than later, the ad business began to lose the allure and sexiness it once had because all of the profit and perks were being taken away.
Also, media is becoming so segmented and the TiVO and DVR are ruining the 30 second TV spot. Suddenly, in order to sell a product you had to do more than buy a spot on a popular network television program. Here are some of the forces at play:
- The internet has made it possible for consumers to share information at more rapid pace and in a much broader format. Not to mention teenagers are spending more time on the internet than watching TV
- Satellite and Cables television have fragmented TV into hundreds of smaller channels all competing for the audiences’ time. Making it more difficult to reach your target market.
- DVRs and TiVo make it possible for television viewers to skip commercials if they so choose
- Enron and other corporate scandals have made consumers lose trust in corporations and anything they sold.
- 9-11 has made our culture re-assess our values and social norms
ultimately, the marketing industry has refused to keep abreast of the change in cultural zeitgeist. Marketers have assumed that all of the changes in the consumer landscape are an aberration and that they will go back to normal. They are not. Also, marketers are losing respect for the consumer. Consumers can no longer be treated like morons, they are too smart for that.
The ultimate trend that must be noted in this changing landscape is that power over the marketing message has shifted from the corporation squarely into the hands of the consumer. They have the ability to switch out and tune in to whatever they want to…in short, if they don’t like what they are hearing, they will not listen and not buy.
Convergence between commerce, content, and consumers is becoming the norm, and in order to keep up, boundaries between the companies that make products, the media outlets whose content drives commerce, and consumers who purchase goods and services need to be taken down. Marketing is now a world where communications are trumping pre-defined business boundaries and changing the game.
Chapter 1: The Punk Marketing Manifesto
Article 1: Avoid Risk and Die
taking risks is necessary. You cannot always count on the consumer to know what they want, you must take a proactive stance and take a risk every now ant then. Make sure that you are communicating with all of the stakeholders in your risk, but take risk nonetheless.
Article 2: Why Not Ask, “Why Not?”
Assumptions are not true. Assume that anything you assume is only half truth or a generalization that may or may not apply to your specific situation. Don’t be afraid to break paradigms
Article 3: Take a Strong Stand
trying to be everything to everybody will make you mean little to anybody. Pick something to stand for and then build a brand around it, don’t worry if people don’t like you, just as long as your loyal customers still do.
Article 4: Don’t Pander
Asking people what they want is not the answer. People don’t know what they want, as Henry Ford said,”If I asked my customers what they wanted they would have told me a faster horse.” Build your product and brand and tell people what you have to offer.
Article 5: Give Up Control
Consumers now conrol brands. The unspoken contract that media provides content and consumers listen is now over. Media is more conversational and everyone has power to influence now.
Article 6: Expose Yourself
If you are dishonest or not transparent in your marketing you will get caught. The internet has made it possible for instant communication between unhappy customers. Honesty is no longer a point of differentiation, it is a requirement for entry.
Article 7: Make Enemies
In order to survive you need to position yourself against an alternative. Create an enemy and boldy go after them
Article 8: Leave them Wanting More
Don’t blow your wad telling your customers how great you are all at once. Let them figure it out slowly, master the art of the tease.
Article 9: Outthink the Competition
Nobody wins in a war of obvious marketing measures. Outspending on ad budget and lowering prices is no good for anyone. Instead, be smart and play for hype and PR. Master the art of guerilla marketing
Article 10: Don’t be seduced by technology
The media is not the message anymore. The message is still the most important part, not the medium by which it is communicated. Don’t be fooled, blogging may be all the rage, but a bad message on a blog is still a bad message.
Article 11: Know Who You Are
Understand what you are good at and stick with it. Don’t forget what made you popular in the first place. E.g. Von Dutch was a cool, underground brand and then they grew too fast and branded everything in site and once they hit the mass market, they were no longer a cool, underground brand.
Article 12: No More Marketing Bullshit
marketing should make things more simple for everyone. The job of a marketer is to make everything glaringly simple before choice paralysis comes into play
Article 13: Don’t Let Others Set Your Standards
Being mediocre is worse than doing nothing. If you have mediocre ads you are just adding to the noise of intrusive ads that are ruining marketing. If you are clever and don’t insult your audiences’ intelligence they might actually go out of their way to view your advertisements.
Article 14: Use the Tools of the Revolution
Create your own punk marketing manifest. Also, don’t fall into the trap of being driven by data. Not everything can be quantified, so stop trying to do it. Avoid the trap of being anesthetized by data that does not always tell the whole truth.
Chapter 2: Kill the Middlemen
With the advent of user-generated content and the democratization of digital technology, you will often go on the internet and find advertisements that are created by individuals that are just as good or better than those that are created by ad agencies.
If you are a smart marketer you will learn to harness that, just like converse did when their ad agency put out a call for independent film makers to create their own ads for the converse brand. The “amateurs” submitted the short films and they were placed online, the winners were given $10K and their ads were shown on television.
Converse was genius because they were able to start a marketing conversation, instead of just dictating the message to the masses. Also, they were given loads of content for free. The $10K prize was a fraction of what they would have paid to create the same content with an ad agency. The message is that there should be no more one-way messaging in marketing
You can go overboard, though. Not everything needs a “conversation”. The limiting factor is that your product has to be something that people personally identify with. You cannot have a web 2.0 site revolving around laundry detergent and expect people to blog about how much they like doing their laundry with Gain. It is like an unpopular kid at school trying really hard to be popular, it will never work.
Not only are agencies getting caught in the crossfire between consumers and middle men, but so is the mainstream media. Blogs are coming of age, and now bloggers are being treated with just as much respect as members of the powerful mainstream media.
Monitoring blogs is important because they can be the brokers of buzz. Many companies are successfully deciding which trends to jump on based on blog chatter and other user generated content.
The best way to use blogs is to get in front of them and take a proactive stance. Start blogging yourself, remember transparency, though. Also, make advertising deals with prolific blogs. There is a lot of money for bloggers and for advertisers that are using blogs.
But buyer beware, user generated content is not the complete answer. Once again, just because it is User generated does not make it good. There are good blogs and there are bad ones, there are good videos and bad ones, only align yourself with the good ones and let the bad ones fade away into the noise
If what the teenagers are doing is any indication of how things are headed, Social media sites will be the new Viacoms and Time Warners of the future. They are becoming the replacement to the shopping mall of the 1990’s and are the place where young people go to socialize and make themselves heard.
Utilizing social networking is important for brands that want to capitalize on cool. You can’t bypass it and create your own buzz, but you have to be seen as enabling kids in getting what they want. Like coke sponsoring a CD give-away on Myspace. Companies need to be able to harness the power of social networking without interrupting the social commentary if they want to be successful.
Chapter 3: Brand, Not Bland
There is so much advertising (especially bad advertising) that it near impossible to rise above the white noise of me-too products that bombard consumers. Being part of the noise is not important, rather, you should learn to be different.
Beauty Sells
One of the biggest ways that you can differentiate is through design. Look no further than Apple to see how design can transform a company. Take something as simple as a portable music player and incorporate a sleek, sexy design and you suddenly have a cultural icon. Quality in design is the new key differentiator.
Also, the razr from Motorola turned the company around because they shifted from, here is the technology, now lets put a package around it, to, here is what the consumer wants, how can we get the technology to make it. There ar some very innovative companies in the world who have built an entire business around design that challenges the ugly status-quo.
Make Yourself Scarce
Design is what the fashion industry is built upon, but what they use to create desire is scarcity. Many fashion brands keep demand strong and long-term profitability up by simply restricting their supply.
The more scarce your products are the more you can charge for them and the more people want them. For example, a British skate brand only lets its doors open for groups of 20 at a time and then restocks the shelves afterward, creating a sense of extreme exclusivity. A brand called bathing ape in Japan uses the same sense of scarcity to sell T-shirts for $400.
Taking the Mass out of the Market
There are pros and cons to brand ubiquity. Coke is in reach of all in sight, but they cannot create scarcity and reach out to individuals the way that Jones Soda does by publishing limited runs of customers on their soda bottles.
Likewise, Krispy Kreme donuts were a big hit because they were scarce and you had to drive 20 miles to find the nearest one to catch it just as the “Hot” light came on. But now franchises are everywhere and you can purchase old, crusty donuts at almost any gas station or grocery store.
One way to expand without losing the idea of scarcity is to manufacture a sense of uniqueness in your offering. Like Buca Di Beppo who as they went national made local advertising to make it seem as if they were a local restaurant, not a national chain.
Mommy, I want one
Toys use the idea of scarcity as well. Every season there is a new batch of must have toys that everyone scrambles to buy. For example, beanie babies were the must have toy of the late 1990’s for a very simple reason, they were scarce.
Ty Warner, the maker of beanie babies discovered on accident that if you “retire” a model, it becomes a collectible item and people will pay large sums of money for them. He rode that wave for a long time and was named the 65th richest man in the world in 1999
Who is Eating Your Lunch?
Capitalism is based on the idea that there is somebody out there waiting to steal your customers. Any marketer needs to avoid complacency and not fall into the trap of assuming that they are either too big to deal with a small competitor, or to small to compete with a larger business. The best situation is for a company to act small while thinking big.
Being big has its advantages but one of the problems with being big is that big business is associated with an anti-consumer sentiment. Big businesses employ children in developing countries to save a few pennies and suck every last dollar from the consumer…or so is the perception. Being big also makes you the target of every upstart who hates big business and wants to take down the establishment
Acting Tiny
Virgin industries is famed for taking on the established contender in the market. They have diversified businesses adding up to $8 Billion a year in sales, but every time they enter a market they always position themselves as the underdog…and win.
Being big is not bad, but being viewed as the big, lumbering corporation is not. That is how the American big 3 auto makers lost their strangle hold on the US car market.
GM, Ford, and Chrysler had a lock down on the American car market until the likes of Toyota, Honda, Nissan, Hyundai, and BMW began to eat away at their market share by focusing on the smaller market segments that were not being focused on by the big 3
The point is that companies can no longer afford to be everything to everyone. Consumers demand to be treated as individuals, not as masses of walking demographics. There is no more mass in the mass media, in order to win you must learn to find and dominate niches.
Growing Pains
Small companies turn profits by keeping up strong appeal for their products among a dedicated and loyal customer base. There are a few things that can happen that can spoil this situation
First, a larger company can notice that a smaller company is making a lot of money in a niche market and they will swoop in and use their resources to swoop in and conquer the niche. Second, a larger company will just buy the smaller brand like Nike did to Hurley in 2002. Third, people will just get sick of you. Fourth, a brand ma grow beyond a core of loyal buyers.
When you become well liked by your core group of loyal customers there comes a decision as to whether or not you want to stay small and forgo future growth or alienate the core group of customers who made you popular. Short sidedness would tell you to grow, but that often represents a rape, burn, pillage strategy for long-term profits.
Chapter 5: The Sell Phone
The cell phone is a device that went from luxury only a few years ago to a necessity of today. Almost everyone has a cell phone and have a love-hate relationship with their mobile device. Either way, marketers are trying to find a way to successfully tap into the marketing potential of the cell pone.
The cell phone is also the most personal of devices. It is our real life partner. It is often used as a way to avoid uncomfortable silences and to send a signal out to the world that you are important and that you have people who need and want you. Because of the personal relationships we have with our mobile devices. Piss off mobile users by being intrusive and you will lose big time.
The key to SMS messaging is opt-ins. The best way to go about it is like any lead generation technique, give a present in exchange for a valuable database of individuals who have “opted-in” to your marketing message. Once you have their info, it must be relevant and never exceed one message a week so as not to piss off your customers and become a nuisance.
If done correctly, marketers have found that less than 1% of those who opt-in ask for their names to be removed from the database, and response rates hover around 15%, which is exponentially higher than direct mail.
Entertainment, Go!
Mobile devices are also being used as entertainment devices. They can be used to watch video, play games, take pictures, send emails, etc. Even though mobile devices will never replace plasma screens and xbox 360’s, we are all in search of convenient way to get our fix of entertainment as we are constantly on the move.
As a result of the interactive multi-media inherent in cell phones, some marketers are catching on with some very groundbreaking new campaigns. For example, GM had a contest where people had to send in pictures of a new Pontiac G6 on their camera phones to win $1 Million. Qwest communications sponsored a picture scavenger hunt where winning schools were awarded prizes. And Burger King introduced a music recognition service where people played music over their cell phone and they were told the artist and song they were listening to.
Likewise, old media conglomerates like Viacom and Disney are entering into revenue sharing agreements to provide wireless content to service providers. You can now get a Disney mobile phone, and watch clips of The Daily Show with John Stewart on your cell phone.
One thing for marketers to be aware of is that even though streaming video does not allow users to skip ahead of ads that does not mean that advertising should be boring and unengaging, just because you can. It may not long before technology comes along that allows you to bypass streaming commercials.
Chapter 6: The Captive Consumer, Callous Corporations Con Customers
Many businesses view marketing’s end as the point of the sale. Wrong! The sale should be he beginning of a beautiful friendship. Too many businesses like credit card companies, ISPs, Banks, Health Clubs, etc. reel you in with false promises and then lock you down with an ironclad contract that prevents you from leaving. Once again, this may lead to short term revenue, but it will kill the long-term viability of your business.
Big monolithic airlines used to think that they had their customers locked into flying with them because of frequent flier miles. Then, all of the sudden, airways like JetBlue and Southwest Airlines began to offer low-cost alternatives that allowed them to eat into the bigger airlines profits. Suddenly, the big airlines were the ones who were trying unsuccessfully to copy smaller airline’s strategies.
When you use any other means than better service or better product to keep members you are royally screwing your brand. People begin to get pissed off at you and you lose business to companies that are willing to give their customers what they want.
the consummate example of this marketing practice is cellular companies. They lock people into 2 year contracts and then charge egregious fees to people who want to get out of their contracts. So instead of improving its customer service and investing in infrastructure, they continue to hide behind contracts
Walmart also thought that it had a strangle-hold on the American consumer because of its obscene buying power and its even more obscene labor policies. Then Target moved in because they began to give customers what they wanted. They realized that winning in their space was more than just giving the cheapest price and stuffing your store with products from the floors to the rafters. They employed talented buyers who found appealing products and their stores were stylishly laid out with only products that their core group of consumers would appreciate. That is why Target is starting to eat Wal-Mart’s lunch!
Chapter 7: Now It’s story time
Every brand has a story to tell. More than just running 30 second spots on television, a brand needs to weave a story throughout many different types of media to effectively tell its story. Short films released on the internet such as what what Mercury did with the release of its new Mariner are a prime example. They released a series of films that only briefly featured the Mariner that was geared towards younger women and it was a surprising advertising success.
Another way to captivate audiences and create a story is to gradually unveil pieces of the story as you go. Slowly unveiling pieces of your story helps people to question their assumptions and gives them things to talk about.
Another marketing technique being employed that helps to tell a story is that of the Alternative-Reality Branding, which creates marketable tales that play out over the net and in real life. One example is the Art of the H3ist campaign that Audi used when releasing the new A3. The whole premise was to fake an art heist pulled off using stolen A3’s and show “surveillance footage” and have people on the internet help to locate the A3’s and art. People are drawn into the story and they can interact with it as well; thus, creating an alternate reality.
Ultimately, there are some lessons to be learned from ARB…that is, the product does not need to be front and center. If you have creative enough paid marketing you can leverage unpaid publicity, if you open up your marketing to the community you will inevitably lose some control.
Chapter 8: Leave Me Alone Will Ya!
When you walk into a grocery store to buy toothpaste you will inevitably find a paralyzing amount of choice. There are all sorts of different varieties of toothpaste with such miniscule differences that it really does not justify the existence of a new product line…e.g. is their any difference between colgate brilliant white and sparkling white toothpaste?
In an attempt to offer more variety to consumers, companies are making a paralyzing amount of differentiation in their product lines that are making it difficult for consumers to really make a choice. Studies have shown that in cases of premium brands, less is more. Offering less variety and limiting product lines to only products with a tangible difference will lead to higher sales overall. The converse is true for value brands such as store brands where there is a perceived lack of variety.
The same is true for advertising. During primetime the average network will play 52 minutes of advertising during the 8-11 pm hours. The barrage of advertising is so daunting that most people who own a DVR watch only 8% of advertising shown on television. When it comes to advertising, less is more. So stop creating advertising for the sake of advertising and make something that rises above the marketing noise. In other words, Simplify!
The Marketing Power Charter
- Consumers are looking to us to simplify their lives
- Consumers have the right to expect clear and easily understood labeling
- We are responsible for keeping the number of choices to a minimum
- Each product variant should be distinctive from any other, and it should meet a real consumer need
- Me-too products that copy competitor items without trying to offer a distinct point of differentiation represent lazy thinking
- We need to use marketing responsibly and only when we have something meaningful to say
- Marketing foisted itself upon consumers is offensive…it will only create antagonism
- There are no-go places marketing professionals need to respect at all times. i.e. The bathroom
- We need to do more listening and learning from signals we get from consumers about their feelings towards marketing
- As marketers, we will take the high ground and be a champion for consumers
Chapter 9: Lies Lies Lies, The Truth about Truth and Factoids about Facts
Consumers distrust marketers. Treating customers like a herd of morons who will summarily do and believe anything you tell them will never work. If a customer detects any dishonesty in your marketing, they will ignore it. The only way to win back your customers is to be completely honest
One of the main causes of dishonesty in business is the pressure to meet shareholder expectations. Often times quarterly profits and losses are more important than your customers overall happiness. Is it any wonder why most customers, and for that matter, employees do not like companies!
Take a hint from Richard Branson. If you make the focus making your employees happy, and then help them to make your customers happy, quarterly profits will follow
Opinions from customers will no longer be kept quiet. Customers will complain to many people at the first sign of a negative experience. 1/3 of dissatisfied customers will complain on the internet. Blogs, podcasts, and consumer websites can be your worst enemy or your best friend. The key is to not take everything so personally and take a page from Bill Gates: “Your most unhappy customers are your greatest source of learning.”
Punk marketers use honesty to differentiate themselves from their competitors. The justification that “everyone else is doing it” will no longer fly with consumers. Being honest will win you the other guy’s customers.
Chapter 10: As Seen on TV
DVR’s allow people to skip television ads, and now that almost everyone has one, companies are forced to evaluate if buying television ads are really worth the skyrocketing prices. That is why companies are looking at ways to get their products into the entertainment, instead of being the easily fast-forwarded through portion between the entertainment.
Movie deals are a great way to place your product. E.T. is the classic example of this…when M&M refused to pay to be placed in the movie, the producers contacted Reese’s Pieces and marketing history was born. Hell, marketers are even paying for movies to make their competitors look bad in movies. And even if you do not contact the producers, sometimes inadvertent mentions are something you should capitalize off of and support. E.g. Harold and Kumar go to Whitecastle.
The best way to get into movies is to get with talent agents, media buyers, or anyone with a Hollywood connection.
Product placement on TV has been booming with the advent of “reality” TV. Willingness by executives to hand out too much product placement can make a reality show look like a glorified infomercial, so beware. TV people often use product placement as a blunt instrument to generate more revenue, so do not leave it to them to subversively mask your attempt to “integrate” your product into the show.
Brand integration for television is crucial. If your brand does not add to the plot of the on-screen action, then you become a disturbance. That is why all product placement should be relevant. For example, integrating on the Apprentice is an easy choice, or Banana Republic integrating on a fashion show is also an easy choice, but if glade plug-ins wanted to integrate on a fashion show it would be horrible.
Content is king, if the show sucks then your placement efforts will be utterly ruined and you will be associated with a really bad show.
You also need to get a marketing program built around the product placement. If you have a product placement then you need to have mentions of your placement on your website and in-store advertisements featuring the tie-in. Otherwise, you lose the repetition and self-aggrandizement that gets customers attention.
Chapter 11: At Last, a Job in Hollywood
It is difficult to get a TV program developed around a brand to air on any respectable network. Everything needs to line up; from the creative people, to the marketers, to the network executive, etc. Needless to say, it is very difficult.
One of the reasons why it is so hard to get programming developed around a brand is that people hate it. If a brand is just thrown in and plastered around a show so that it looks like a commercial, people will treat it like a commercial and tune out. If you get creative and be subtle, like Grey Goose with Iconoclasts and BMW with their series of short films then you will be successful
Retailers are also getting creative by “doing deals” with content producers so that they get exclusive rights to distribute media. Target sells exclusive music from popular artists like John Legend and Rob Thomas, Best Buy sold an exclusive DVD set from the Rolling Stones, and Wal-Mart sold DVD companions to Kanye West’s latest release.
There are also deals that are the absolute reversal of the old advertising model. Where entertainers and producers of content are paying money to be featured on the packaging of popular brands, like coke cans.
Chapter 12: Game On, No One is a Loser
Newsflash! Video games are no longer just for socially awkward teenage boys. In fact, the majority of video game players in the U.S. are now over 18, and 40% are actually women, when you shift that number to include casual online gamers, the number dramatically swings in the favor of women. That being said, video games are as pervasive of a medium for advertising as television and movies are.
A new advertising phenomenon has been the rise of in-game advertising. It used to be that video game makers had to beg to use brands in their games to give it a more realistic feel, now the tables have turned, with companies shelling out big dollars to get their brands placed in popular video games.
Another trend to watch is corporate sponsorship of video game tournaments and those who participate in them. Video game tournaments are gaining momentum as a viable “sports-entertainment” venture. As more television networks pick up gaming events watch for corporate sponsorship to have a bigger role in the field.
Aside from sponsoring existing titles from the big name video game makers such as EA and Activision, marketers are also commissioning “adveragmes”. These games are produced at a fraction of the cost of a 30 second commercial, and are hosted on either the companies corporate site and/or on large internet gaming portal sites. These games have been effective at drawing large numbers of visitors to the website and garnering a lot of brand recognition.
Finally, one huge trend to pay attention to is the introduction of large virtual worlds. For example, Vivendi makes over $60M a month from subscription fees for its World of Warcraft. Worlds such as Second Life also allow people to create products and advertise just the same as if they were in real life. They also allow people to keep all intellectual property rights to anything they create in the game, making it a prime location to do test marketing or to pre-screen a product before being introduced in the real world.
Chapter 13: It’s More Than Just Us, Hard as That is to Believe
There are many agencies that have bought into the punk marketing manifesto. They are media agnostic, meaning that they do not view one media channel to be more important than any other, all are equally effective at communicating creative ideas to people.
Alongside being media agnostic, it is imperative that marketers take risks to bring about the “impossible”. Like taking out seats at a sports stadium and putting a mini cooper in their place, or building an island in the middle of a concrete jungle…these are all ideas of punk marketing.
One of the biggest ways to get rid of the old-school marketing paradigm is to create an environment at work where people can actually work and be creative. Collaboration is key, the agencies that are embracing collaboration are the ones that are creating the most memorable and effective advertising.
”Creative” needs to be a word that is used in the marketing process from the onset of developing a product, not just an after thought that is relegated to agencies. The more creative you throughout the whole process the more you will be able to push beyond boundaries and produce something awesome.
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