Measuring Up

Starbucks's CSR campaign asks “Are you in?”

Sadly, more and more of its employees are out these days because of job cuts. And, clearly the last few years haven’t been kind to this global, retail coffee king. The company lost its mojo by expanding much too quickly into neighborhoods, towns and specific spots that didn’t fit its customer base. On top of that, Starbucks greatly diluted its brand by lessening coffee brewing standards (that had made it the champion in the first place) and by offering so many other foods (like sausage breakfast sandwiches) which greatly changed the atmosphere and experience at the actual store.

All of this negative commotion has seemingly taken away some credit that the company deserves for continually leading the way in giving back to communities and the world. And, that’s too bad. Since the beginning, Starbucks has been a leader in making sure that its products (coffee beans) are grown, harvested, transported, etc., in the most environmentally friendly way. The company also pays strict attention to taking care of the local resources and indigenous people where its coffee originates from. And, if you go to Starbucks’ web site, one can find countless programs that the company offers to promote giving back to worthwhile causes.

A few weeks ago, Starbucks launched another very smart and caring program called “Are you in?”  Based on President Obama’s mandate to be more civic minded and conduct community service, Starbucks is asking consumers to pledge just five hours of service within his/her community and it will do its part by handing out a large, free cup of hot coffee. There’s a special pledge page on the company’s web site to get started.

Starbucks received some nice publicity when this program came out (I remember seeing it on one of the national morning shows.) I would imagine that the company is pleased with that because every organization wants to be recognized for these cause programs. But for Starbucks, this is really just a drop in the bucket. Giving back and standing tall around causes that matter are part of this company’s DNA. Some would say its Starbuck’s signature on the society we live in.

Lots of companies start, stop and start again various programs to help causes. Many do it because they really care (but are torn between what issues to stand behind.) Others simply want the exposure and good will that often comes with it but don’t care enough to make any one program sustainable. I submit that it doesn’t really matter what cause or issue your company puts its resources behind. Like Starbucks, it needs to take on a higher meaning and should become a signature-like program that is tied to your business.

Only in this way, can companies always see just how strategic those causes are to make the organization a deeper, more caring part of that community or constituent base, and to realize that it actually is helping to grow business as well. One would hope that this type of signature program would become a part of the company’s fabric, which would end the all too frequent starts and stops that take place because of bad economic conditions, new leadership or any other reason.

In the words of Richard Daley, "Cuckoo"

This is clearly how the former Chicago Mayor and (undoubtedly) thousands of other Americans feel about Rod Blagojevich, the embattled Governor of Illinois.

Everyone knows the story, but just to recap current events: Blagojevich was caught red handed, on tape, telling associates over the phone that the now vacant Obama Senate seat was up for sale to the highest bidder. U.S Attorney General Patrick Fitzgerald ceremoniously announced the attempted crime weeks ago. And now, the Governor has been impeached and is days (or weeks away) from being voted out of office by the Illinois House of Representatives.

So, what does Blagojevich do? He embarks on the highest profile, New York City media tour to declare his complete innocence. Only, the tour is actually more like a three-ring circus because of the off the wall comments, messages and analogies that the Illinois Governor continues to spout off. Let's see, we've heard him compare his situation to Pearl Harbor (I think the intended meaning was that this is one giant surprise attack against him.) And, the man has actually said on camera that his persecution is very much like that Gandhi, Nelson Mandela and Martin Luther King had to endure. But, my personal favorite is Blagojevich's analogies to famous movies like being in a "21st Century Frank Capra film" where the good guy's odds are piled high against him as he fights the establishment. His reference to the famed moved Silverado, (a western in which an innocent man is about to be hung for a theft he never committed,) was pretty entertaining as well.

Everyone thinks that Blagojevich is either crazy or clueless. From a pure public relations stand point, it's very hard to deem that anyone can be living the latter reality. After all, this governor's literal use of these support points (what we in the business call sound bytes) to convince Americans of his innocence is simply unbelievable. Referring to your plight in even the same sentence as Gandhi or Nelson Mandela's is abhorrent and is also a sure fire way to make people sit up, listen and shake their heads in disgust.

But maybe... just maybe, the governor has actually fooled all of us. What if Blagojevich is simply auditioning on the most visible stage ever for his next career in entertainment? I know, it sounds crazy. The man will (or may) spend time in jail. If this happens, any new career plans will have to wait. We all know that his 15 minutes of fame will soon fade away once he is behind bars. Or will it?

The Illinois Governor will surely be impeached. But, the world is witnessing first hand his outlandish, bizarrely charismatic and beyond wacky personality. Undoubtedly, this will certainly have some appeal to those on the fringes of the entertainment world who are looking for a caricature of the Governor in their commercials, promotions or even movies. (Think of the short term gigs that Tanya Harding and OJ Simpson were handed after their infamous crimes.) After all, we all know that evil is a highly marketable proposition in the entertainment world. People are mesmerized watching it. And, that means $$$.

Yes, in the end, Rod Blagojevich may actually have the last laugh if he parlays his political fall into an entertainment bonanza. Albeit, one has to wonder if his fame is actually sustainable in any way.

Then again, the man might simply be cuckoo.

Thain's $1.2 million throw away

When will public company CEOs ever learn?

That might be a rhetorical question because I'm not sure some ever will. Recent news that former Merrill Lynch CEO John Thain spent 1.22 million bucks to decorate his office is simply disturbing.

Now, I'm assuming that he spent Merrill's dollars on this renovation debacle. Or, it certainly wouldn't be such a front page, controversial story if this wasn't the case.

Here's the problem with Thain. The man took over more than a year ago from Stanley O'Neal to steer Merrill's ship out of extremely choppy waters after it became public that the firm had lost tens of billions of dollars in mortgage-backed securities. Merrill was hemorrhaging at that point. The Board was up in arms and investors were panicking.

As a former Merrill shareholder, I remember the angry emotions felt because I thought we had been taken for another incorrigible Wall Street scandal. And, that indeed was the case.

So, John Thain comes riding in, fresh from helping to fix (and add much needed credibility) to the then maligned New York Stock Exchange. And, he pledged to try and do the same thing at Merrill. This meant uncovering all of the bad investments, making strategic moves to shore up business and, of course, cutting all costs to close the gap on the bleeding losses.

Now, we find out that this man actually defines the word hypocrite and basically deceived us all. Spending that amount of money on his office, during the toughest times, is simply unacceptable (actually most would agree that blowing that sum of money on an office at any time is pathetic.)

The amount of money he spent has no real material impact on Merrill's earnings or problems. No, it's just the fact that he preached austerity, yet lived high and mighty, which truly annoys this former shareholder beyond belief.

And, why did he make such a dumb and selfish move? We'll never really know that. But, my guess is that the pure ego of a Wall Street titan easily won the battle over common sense.

I can't wait to see the law suits pile on even higher because of this arrogant stunt. This public relations disaster, taking place in the heart of an unpopular government bailout, will provide Mr. Thain with little comfort or relaxation as he is pushed out into the sunset.

A minor blotch on an otherwise wonderful day

Any American who cares about freedom and equal rights regardless of race, religion, sex, etc., probably experienced some goose bumps yesterday. After all, an African American man is now our President. And, a dream has come true.

Unfortunately, I was driving to a business meeting yesterday and had to listen to the inaugural events on the radio. Everything I heard seemed so festive and exciting leading up to the swearing in of our 44th President. And then, I listened to the invocation given by the Reverend Rick Warren. His short prayer made me shake my head in great disappointment.

You see, this holy man used the global light that was shining so brightly on his bully pulpit to push out an agenda that had little to do with respecting all Americans. In fact, it ran opposite to Obama's theme of acceptance of all and finding ways to bring people together regardless of religious or political beliefs. No, instead this narrow minded pastor pushed out his two points that should never have been uttered on this magical day: A blessing for Israel and the need to pray to (his lord) Jesus Christ. And, that was just wrong.

Why? Well for one, by allowing this man to do this, it sent a message to millions of American Muslims or others who don't support Israel or have never believed in Jesus Christ, that this administration doesn't really support their views. To do this on a national stage, in front of the world, this new President actually allowed this controversial agenda to be set on his post. And, it greatly conflicted (ironically) with Obama's inaugural speech given just 30 minutes later.

There isn't a preacher in America who wouldn't have mentioned God in this invocation. And, I think that regardless of one's specific belief in religion, Americans everywhere would have been just fine if this prayer were focused on just that word because all of our mainstream religions believe in their own God through their own traditions and prayers. But, praying to Jesus (regardless of what language his name is uttered in)speaks volumes to Jews (who, by the way helped to elect Obama,) Muslims and other non Christian religions in our country. And, as much as I believe in Israel, supporting it like he did, probably more than offended the countless Arab American communities across our country. 

Clearly, by selecting Warren to preside over this time honored prayer, Obama was actually trying to heal wounds with the right wing and bring these two sides closer together (if that is at all possible.) Ironically though, it only served to loosen the binds that are already weak between those other religious groups who wonder whether they will ever get a fair shake in this country that is supposed to now become a beacon of tolerance under a President who has promised so much change.

This is not the year to advertise on the Super Bowl

A few days back, The New York Times advertising column featured Denny’s and some of the other companies who’ve chosen to advertise in this year’s Super Bowl. Every year, marketing and business pundits debate whether this one-time venue’s premium advertising slot is worth the cost. The golden question is: Does it provide a real return on the huge cost associated with it?

Almost always, I take the pessimist’s view point of this debate. Unless the advertiser’s sole goal is to immediately drive one time traffic to a web site, or one time limited sales of a product, I just don’t see the bang for the buck (and even then the benefit won’t be higher than the cost). Most marketers leverage the Super Bowl both for ongoing brand building and the hope that it will create a spike that will lead to a continual rise in product sales. There may be some instances where the latter has happened, but I’d like someone to prove it to me.

This year, the advertising “opportunity” seems almost ludicrous. In the toughest of times, NBC has actually raised the rate of a 30-second spot from $2.7 million to $3 million (gee, what a deal.) One agency executive believes there is real value to be had here and asks the rhetorical question, “Where else can I hit 97 million people?”

That may be true (although I question whether a Cardinal/Steelers game will have that type of viewer turnout,) but I believe there are three important reasons why the Super Bowl makes even less sense now than in years past:

1.) The PR hit – Almost every company is cutting costs and laying off its employees. We’re talking about millions of people out of work. It would be an understatement to say that the general mood in America is somber (at best.) How will these advertisers be viewed by their employees, investors and other key constituents when they are seen as frivolously spending $3 million in 30 seconds, while so much turmoil is taking place in the background?

2.) The price actually went up – Give me a break. I just don’t know how any organization can justify raising prices now. Most have actually created cost concessions with the addition of greater benefits in their products/services. I’d probably walk away or terminate the relationship with any partner/vendor that had the audacity to actually raise prices instead.

3.) Use the money more strategically – Consumers are buying less and they are more selective about what they buy. Think about how far $3 million could stretch through a more strategic marketing program that is directly aligned with point of sales or thought leadership to make prospects/customers trust the company’s products/services more. I’d say that most advertisers would actually do better by spending the whole enchilada on events at their restaurants or at retail designed to create more direct publicity and interest in retail sales than through an ad that will be over in the blink of an eye. Just so it doesn’t seem like I’m only pushing public relations approaches, I think direct marketing (email, leveraging the Web), digital campaigns) could provide longer, more sustainable ROI as well.

Consumers may enjoy watching some of these lighter commercials. Does some brief laughter support the millions being spent? No.

Let’s get those Vets some help

Over the last year, the subject of Post Traumatic Stress Disorder (PTSD) has become much more visible as  our Iraq and Afghanistan veterans have come home and tried to regain their normal lives. I’ve been reading a lot about it lately (with good reason.) The problem is that many of these proud and heroic soldiers are suffering through it every day, but aren’t taking the necessary steps forward to get help.

What is PTSD?

Well, according to experts it’s an anxiety disorder that can occur after a person has been through a traumatic event. We’ve seen, watched and learned about the often brutal, life threatening activities that our soldiers had to experience while fighting these two wars. Many of them say that their transition back to a normal home life, after living through months of intensity is just very difficult.

Symptoms of PTSD often (or can) include:
-    Trouble concentrating
-    Hopelessness
-    The feeling of no control over what is happening
-    Being jumpy and startled easily
-    Constantly tired and/or depressed
-    Disturbing dreams and nightmares

It’s important that those who served their country are now helped in any way we can. PTSD rates are rising because our soldiers are serving longer, multiple separations from the communities which typically protect them. To raise as much awareness around this cause as possible, Peppercom has partnered with the Ad Council to conduct a pro bono public relations campaign to support the Iraq and Afghanistan Veterans Association (IAVA). The goal is to spread the word to those Vets who might be affected, as well as their family and friends, to come forward and ask for help. Because there are many ways to treat this disorder.

Please help spread the word.

Oh, the joy of reading…

My eight-year old son loves to read. In particular, he is obsessed with a series of books called “Diary of a Wimpy Kid.”

The other night, he was laughing so loud with this book in hand that I asked him to please read me a few pages so I could find out what in blazes was so funny. He did. And, I didn’t get it,  but I figured that the rude, crude and sad stories surrounding this wimpy kid must have something pretty appealing to a third grader.

As it turns out, I was right. The Wimpy Kid series has become a craze across the country. According to yesterday’s New York Times article, it’s become so popular that countless schoolboys have recorded video reviews of the books and uploaded them to YouTube. And, just to show how powerful the digital world is with 8-10 year old kids, Facebook fan groups have been organized in honor of the “Wimpy Kid.” Some grade-school teachers are even planning parties next week to welcome the newest installment in the series. The first book of this series spent 87 weeks on The New York Times Childrens Best Seller list and now over 10 million copies have been sold.

After reading this powerful article, I started to wonder what this books’ secret sauce is. I mean with so many thousands of kids’ books out there, how does one (in particular) stand apart to become a true hit. I decided to informally poll my son (a true experience). Josh told me that he and all his friends love it because this kid is always “getting hurt, beat up or in trouble. He’s the master of video games, hates Phys Ed and he’s just wimpy…”

Ok. That helped… a little. So, to find out more, I read a chapter. I quickly realized that this book is the closest thing I’ve seen to the Dennis the Menace of this generation. And, this author (whose name is Jeff Kinney) did something very smart. He set off to create The Wonder Years-type backward glance at an awkward age. And, he hoped that kids would understand the first person, somewhat narcissistic and ironic humor that Greg (the main character and narrator) so sadly lives. Another bonus is that the author draws each boy (within the book) with distinct awkward characteristics that most any 8-year old feels in one way or another. And, of course, the girls look almost exactly alike. As one passage states, "they're objects of mystery and terror."

I can tell you first hand that my son Josh lives this passage each and every day.

Parents don't always love these books because Greg isn't exactly a role model and his deep flaws often lead to a medley of negative actions. But, maybe that's what makes this entire post so interesting. It's the 8-10 year old boys who push their moms to buy these books (and it's a pretty hard push from what I can tell). And, in the end, moms just want to see their boys reading so they acquiesce.

Whoever said that kids (boys in this case) couldn't create their own viral (successful) revolution by themselves, is just plain wrong. The Wimpy Kid is no wimpy concept. It has caught fire and is the boldest new means to make reading fun for boys in a long time.

This is no way to create economic prosperity

I read (with eyes bulging wide open) the following story in today's Wall Street Journal (What Ails Belgium? Workers' Sick Time).

Peppercom has an office in Europe and we've always done a lot of business on the Continent. So, we have a  pretty good understanding of just how strong employee rights are when it comes to holiday or sick leave. But, this story takes this issue to an entirely new level of waste. And, it shows how terrible labor laws can create country wide epidemics that hurt the chances of that society's prosperity.

Yes, I know... I am an employer. So, my view is skewed (somewhat.) But, it is just crazy that private sector workers in this country are entitled to unlimited sick leave for reasons such as: depression because a girlfriend break up, packing before long holidays and even to sleep off holiday hangovers.

As you can read, the problem is so bad in Belgium that the government had to set up a network of Gestapo-like medical inspectors to actually go door to door, checking out random workers who called in sick that day. Not surprisingly, they found that a full 65 percent of those "depressed" individuals could have indeed gone in to be productive in their respective jobs.

The problem is that labor unions are still too strong in Belgium and throughout Europe. So, when an employer challenges the employee, the unions typically sue in court. And, they win 70 percent of the time.

I hate to make gross stereotypes, but this is one of the key reasons why countries like Belgium and France continually struggle to be economically viable.

What started out as a good principle, ‘life shouldn't be only about work,’ has been severely abused to the point where private businesses in these countries are handicapped because of deficient worker productivity. Yet, this backwards way of government thinking is too ingrained in these cultures to ever really change.

Now, all countries across the globe are desperately trying to push their way out of this recession. There is no way that a large healthcare instruments manufacturer (as an example) in Belgium will be able to compete with key competitors in the U.S. or China with such extreme low productivity outputs, due to these laws. So, many Belgian companies will go under and this country will surely be among the last ones to recover successfully.

It seems to me that the types of draconian measures highlighted in this article, should be exponentially intensified to change a "lazy" culture. Or, this country will be feeling a world of hurt for a long time.

"We were penalized for going the extra mile"

That's the statement that Dr. Wael Salameh, the medical director for  endocrinology at Quest Diagnostics, gave to The New York Times in this article. Quest, one of the largest and most trusted diagnostic labs in the country, was hammered this morning by The New York Times. In my opinion, the company handled this story poorly. More importantly, it demonstrated a lack of any real sensitivity or care. And, that makes little sense in the heat of a crisis.

Per the front page story, Quest admitted that results of thousands of vitamin D tests over the last two years could be wrong. The company says that it has fixed the problem and had already sent out letters to thousands of doctors listing the patients who might have received "questionable" test results.

While this failure rarely leads to terminal complications, an erroneous low test result might lead to instances of toxic overdose of vitamin D. And, that's just dangerous.

What got my attention is that the Quest spokesperson didn't really demonstrate contrition and his tone (from this article) comes off as very scientific (i.e. cold) versus expressing some semblance of warmth and concern.

After all, according to one expert, this is the largest patient test recall in the last 20 years. And, four of Quest's seven testing labs didn't follow the right procedures. That's a big deal.

Dr. Salameh's headline quote creates the feeling that Quest would have been better off if it didn't do everything it could to tell everyone who could be impacted about the failure. And then, Quest went on to argue (at the end of the article) that its labs are perfectly fine and do not need more quality checks and greater regulation by the FDA. Hmmm... I'd really question whether this particular story is the right one for the lab company to debate that point.

This all leads to my rules of the day.

Rule #1 - when a crisis hits, using the right spokesperson is absolutely critical to containing it. I'm sure this scientist is incredibly knowledgeable on the issues at hand. But, if he can't strike the right chord of contrition (and just as importantly), misses the boat on showing some remorse, then the crisis will blow up more.

Rule #2 - get a reality check on which messages will work. In my opinion, Quest looks foolish because it is admitting to a major quality blunder. Then out of the other side of his mouth, the spokesperson states that their labs need no further regulation or checks. It's like the company is hoping that no one will take notice and the problem will just be swept right under the door.

Rule #3 - final point. If you're admitting fault (which Quest did), then really admit it. Going halfway actually creates more harm than good and a worse perception.

We’re all in this life boat together…

It’s good to be back, penning this post after a relaxing holiday vacation.

Through my travels, one thing that I’ve noticed a lot over the last two weeks is just how resourceful companies have become to sell (or unload) products from their stores, factories and dealerships. For example, I’ve seen some surprising sales at the higher end clothing retailers for upwards of 90 percent off. I’ve also read about some incredible offerings at auto dealerships. One (University Dodge) is now actually promoting a buy one car and get another Ram, Caliber or PT Cruiser completely free.  That has to be a first.

Desperate times call for desperate tactics. And, it’s hard to knock any of these companies for doing whatever it takes to enhance sales.

Then, as I watched the NFL playoffs last night, I saw a TV ad that really turned my head. No, this promotion didn’t have any hint of distress or torment like all the others. Instead because of its smart and strategic approach, this company struck an emotional chord in a completely different way.

Hyundai is one smart marketer. And, the Hyundai Assurance Program, makes the consumer feel like this car company really cares about his/her problems. You see, the positioning behind this campaign is “If you lose your job, we’ve got your back.” Very, very creative – through this program, Hyundai has changed its sales strategy by giving its customers the ability to simply return any company made vehicle if they lose their income within a one year period. The program actually runs deeper than this, because Hyundai lists six different “life altering” qualifications that will be accepted (including loss of license due to medical impairment and physical disability leading to a lost job.)

This marketing/sales strategy truly takes advantage of the psychological need that consumers have to be financially protected and secure. Those who believe they can currently afford a Hyundai SUV or car, but are riddled with anxiety regarding their ability to earn or maintain income six months from now, can feel comfort in knowing that they won’t be saddled with this burden should the worst actually happen. My bet is that this strategy will create very real incremental sales for Hyundai.

Just as importantly, this program’s 180 degree different approach creates a warm feeling that we’re all partners in these tough times. It allows Hyundai to truly separate itself from all the other automotive manufacturers in that way. I think the advertising tag line sums it up perfectly, “We’re all in this together. We’ll get through it together.”