Marketing News: April/May 2017 by Molly Soat

American Marketing Association

ama.org

April/May 2017

The

Human S i d e of

Social Media

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table of contents AMERICAN MARKETING ASSOCIATION

Seen on aMa.orG

8-11

anSwerS in aCtion • Snapshot • Core Concepts

12-16

aMa intelliGenCe •The Middle Market •MBA Perspectives •Scholarly Insights

18-29

eXeCutive inSiGhtS • David Aaker • Vikas Mittal • Lawrence Crosby • Michael Krauss • David Krajicek

62-66

Career advanCeMent • On the Record • Personal Branding

#offiCeGoalS

The Revolution Was #Live

the #NoDApl movement may not have successfully stopped a pipeline, but it brought Native American voices and issues to the top of social media feeds.

48 Cover: photograper: lisa predko.

Assistants: Jacqueline Ayala, tom Michas. Wardrobe Stylist: Amber Halaka. Hand Model: Chris Martiniano. leg Model: Jacqueline Ayala. Catering: Andrea Donadio. retouching: tom Michas.

FiND oUT MorE AT

ama .org

Impressionable Mind Games Social Media, Smartphones and Other Drugs

Where is the ethical line in marketing between hooking a customer and getting them hooked?

Companies are looking for help to take control of their reputations in the anything-goes world of online reviews. But with so many efforts to manipulate ratings, will consumers still trust reviews enough to care?

new Kids and the Blocks

A new app-based social network from leGO appears to be doing the extraordinary: providing a safe space for children online while winning plaudits from parents.

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April/May 2017

Vol. 51 | No. 4

Letter from the Editor

American Marketing Association

The Social Impact

ocial media is a reflection of how human communication evolves. Now-ubiquitous Snapchat has brought social media down to a more authentic, more human level. We get our news not from a paper or a homepage, but from meticulously curated Facebook feeds. Truth itself has become a topic of debate, thanks in large part to the megaphone-like power of Twitter. A marketer’s job is to understand both technology and people in equal measure. From Facebook activism to user reviews to social media addiction, the stories in this issue examine one central topic: the people behind social media. Sarah Steimer explores the successes (and failures) of the movement against the Dakota Access Pipeline, which was rooted in live streams and hashtags on social media. “The movement did something still relatively new in storytelling. Not only did it tell its story in real time, but it opened that voice up to anyone who would listen,” Steimer writes. Marketers are always trying to find a way to efficiently listen to customers online, and Zach Brooke explores how

Valarie Zeithaml Chairperson of the AMA Board 2016-2017 Russ Klein, AMA Chief Executive Officer rklein@ama.org Andy Friedman, AMA Chief Content Officer afriedman@ama.org Editorial Staff

Phone (800) AMA-1150 • Fax (312) 542-9001 E-mail editor@ama.org

online reviews can help. Experts call user reviews “the most valuable form of social data, in contrast to social networks like Facebook and Twitter. … The two items that social media monitoring is toughest with is relevance and sentiment. Those are two things that review data guarantees accuracy with.” Hal Conick dives into the darker side of social media use: the potential for reliance upon and, ultimately, addiction to likes and comments. “Humans are now ‘networked individuals,’” Conick writes. “This means people actively seek online social capital but physical group settings—such as bowling leagues—have become less common.” I feel confident in saying, without hyperbole, that social media has the power to change the world—for better or worse. Do you agree? Molly Soat Editor in Chief @MollySoat

Molly Soat, Editor in Chief msoat@ama.org Michelle Markelz, Managing Editor mmarkelz@ama.org Zach Brooke, Staff Writer zbrooke@ama.org Hal Conick, Staff Writer hconick@ama.org Sarah Steimer, Staff Writer ssteimer@ama.org Vince Cerasani, Associate Art Director vcerasani@ama.org Advertising Staff

Fax (312) 922-3763 • E-mail ads@ama.org Sally Schmitz, Production Manager sschmitz@ama.org (312) 542-9038 Michael Gay, Account Executive mgay@yourmembership.com (727) 329-4421 Nicola Tate, Account Executive ntate@yourmembership.com (727) 329-4437 Jordan Berthiaume, Media Sales Representative jberthiaume@YourMembership.com (727) 497-6565 x3409 Marketing News (ISSN 0025-3790) is published monthly except April/May and November/December (pending) by the American Marketing Association, 130 E. Randolph St., 22nd Floor, Chicago, IL 60601. Circulation: (800) AMA-1150, (312) 542-9000 Tel: (800) AMA-1150, (312) 542-9000 POSTMASTER: Send address changes to: Marketing News, 130 E. Randolph St., 22nd Floor, Chicago, 60601-6320, USA. Periodical Postage paid at Chicago, Ill., and additional mailing offices. Canada Post Agreement Number 40030960. Opinions expressed are not necessarily endorsed by the AMA, its officers or staff. Marketing News welcomes expressions of all professional viewpoints on marketing and its related areas. These may be as letters to the editor, columns or articles. Letters should be brief and may be condensed by the editors. Please request a copy of the “Writers’ Guidelines” before submitting an article. Upon submission to the AMA, photographs and manuscripts will not be returned unless accompanied by a self-addressed, adequately stamped envelope.

Contributors

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Advertisers and advertising agencies assume liability for all content (including text, representations and illustrations) of advertisements published, and also assume responsibility for any claims arising therefrom made against the publisher. The right is reserved to reject any advertisement.

Lisa Predko

Jessica Schaeffer

Predko is a Chicago-based commercial and editorial photographer who specializes in conceptual and narrative work. Shooting characters and creating her own vibrant world, Lisa loves using light and color to evoke emotion and hero her subjects.

Schaeffer is the director of marketing and communications at LaSalle Network, a national staffing, recruiting and culture firm.

Copyright © 2017 by the American Marketing Association. All rights reserved. Without written permission from the AMA, any copying or reprinting (except by authors reprinting their own works) is prohibited. Requests for permission to reprint—such as copying for general distribution, advertising or promotional purposes, creating new collective works or resale—should be submitted in writing by mail or sent via e-mail to permissions@ama.org. Reprints in quantity are available by contacting Kristy Snyder at Sheridan Reprints: (717) 632-3535.

Predko Photo by Alberto Vasari

Single copies $10 individual, $10 institutions; foreign add $5 per copy for air, printed matter. Payment must be in U.S. funds or the equivalent. Canadian residents add 13% GST (GST Registration #127478527).

Printed in the U.S.A.

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How to Leverage a Social Media Firestorm to Increase Brand Value

re you beach body ready? This slogan, overlaid on an ad featuring a woman in a yellow bikini, took Protein World from relative obscurity to receiving 15,000 tweets per day. But was it a success? Joachim Scholz, assistant professor of marketing at California Polytechnic State University, says Protein World’s “beach body” ad generated 70,000 online signatures against the company and a bomb threat to its headquarters. However, by the end of the firestorm, Protein World gained more than 10,000 Twitter followers and continues to grow its follower count. Instead of trying to downplay the fury of those who saw the ads, the British company tweeted polemics

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like, “We are a nation of sympathizers for fatties,” and framed its critics as “lazy and weak.” This allowed the company to frame itself, but also its opposition, Scholz says. Protein World told one Twitter responder to “grow up.” Scholz called this “distributed cultural jiu jitsu,” as the company used the force of its opponents against the them. “The important point is that Protein World—through framing its critics as lazy and weak hypocrites and singling out certain hashtags and individuals—enabled their brand supporters to join the controversy,” Scholz wrote in a follow-up e-mail. “Protein World was able to create brand value in this firestorm because they activated their brand supporters to attack and troll their critics. I call this the ‘Distributed Infuriation Strategy.’” This method was also used to flip negative hashtags into beneficial hashtags for the company. By

proffering “#FitShaming,” Protein World used cultural jiu jitsu on the #BodyShaming hashtag aimed at the campaign by those who said the model was not what real women looked like. Another hashtag— #GrowUpHarriet—based on Protein World’s tweet at a woman who asked if she was allowed on the beach, was quickly used to bask in the attention and criticism. “That kind of twist from ‘body shaming’ to ‘fit shaming’ allowed a focused discussion,” Scholz says. However, this is when the non-corporate trolls started tuning into the conversation. The Daily Mail and Breitbart, two firebrand outlets known for provocative headlines and right-leaning content, picked up the story and framed “#FitShaming” as an epidemic. Other accounts, such as InfoWars editor-at-large Paul Joseph Watson and Christina Hoff Sommers, resident scholar at conservative think tank the American Enterprise

Institute, then entered the fray and drew in even more followers. Scholz called these accounts “support trolls,” but says they were anything but supportive of the brand’s message. These “support trolls” didn’t connect to the idea of fitness and left a poor taste in the mouths of many potential customers. It only took seven days for someone to receive a rape threat during the firestorm, Scholz says, at which point Protein World dropped the “#GrowUpHarriet” hashtag. “As a brand you can infuriate customers and instigate a social media firestorm [to help the brand], but it has to be framed and focused,” Scholz says. The framing is the most important part, he says. If the firestorm gets out of hand, others chiming in can instead weaken the brand’s framing and turn the firestorm into a scorched earth. –Hal Conick

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How A Personal Essay About Buyer Remorse Got West Elm to Pull a Couch

nna Hezel is not a copywriter, but she sure knows how to imitate one. The 28-year-old writer created a couch-size hole in her otherwise perfect life in an essay published in February on The Awl, a critical darling read by many media professionals. There was the emotional connection to a happy childhood. “When I was a kid my grandma had a couch on her front porch that was, as a result of some sort of thrifty post-wartime craft project, stuffed with crumpled-up newspapers.” There was the linkage between furniture and her social status and self-image.

“I find myself drawn into the same capitalistic pitfall that many young professionals are drawn into — a need to prove my adulthood with mid-century furniture. And more specifically, a need to prove that I’ve graduated from Walmart bedframes and second-hand plywood shelves scooped up from the sidewalk.” There was an easy, helpful solution to the domestic issues nagging at her, which as a bonus, would also affirm and solidify her relationship. “This is why, a few weeks after moving in with my partner, Kevin, we decided to buy a couch from West Elm. The couch would be the most prominent piece of furniture in our small apartment and our first big purchase together—a gigantic

spongy representation of our shared style sensibility. We chose a West Elm design called the ‘Peggy’ in a deep, rusty orange color. We would each put a fat $600 towards the couch, and that money would be an investment into our new life together. It was more than we were used to paying for a piece of furniture, but the price seemed to be proof of enduring quality. I looked at the image on the West Elm website and saw an entire montage of us laughing on the couch with friends, reading the Sunday paper on the couch, drinking obscure liqueurs on the couch (would this be the couch on which we would discover that we loved Cynar or Chartreuse?), moving the couch into a larger apartment,

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covering the couch with tarps while we painted the walls around it a daring color, giving birth on the couch, dying on the couch.” Unfortunately for West Elm, all this build-up led to a payoff that lacerated the Brooklyn-based Williams-Sonoma subsidiary. The article, titled “Why Does This One Couch From West Elm Suck So Much?” went on to detail complaints Hezel had with the “Peggy” couch, a mid-century affair with its frame and cushions held up by long, slender wooden pegs. The chief issue appeared to be buttons popping off of the couch’s upholstery when brushed against. Attempts to repair the couch were beset with similar frustration, as the kit that customer service sent her was both delayed and unhelpful. Eventually, the couch collapsed on one side during a New Year’s Eve party, leading her to declare to her partner, “We’re getting a new couch.” Online criticism of products and brands is as old as the internet itself, and every marketer should have a strategy to address or ignore a controversy. However, most upset customers don’t have the writing skills of Hezel, or the audience of The Awl. Another big reason Hezel’s article resonated may have something to do with the fact that there is no

single area online to give feedback on West Elm products. Hezel provided that platform to highlight reviews made by a small army of Peggy owners who had similar experiences. She noted there were no product reviews on the company website, so angry customers vented on the social sites for individual West Elm locations and on the brand’s Instagram account. A few days after the post was published, pop culture news site The A/V Club reported that the Peggy was no longer featured on West Elm’s website. West Elm PR + Influencer Marketing Manager Dru Ortega passed along a statement that is making the rounds online. “We were sorry to learn of our customers’ experience with the Peggy Collection and have decided to temporarily remove it from our U.S. and Canada assortment—online and in stores—until we can better understand and resolve any issues. “We stand behind the integrity of our products and take customer feedback seriously. Therefore, we are offering owners of defective Peggy sofas, sectionals and chairs a full refund or replacement for orders placed in the U.S. and Canada after July 2014.” –Zach Brooke

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snapshot

Kit Kat Takes a Chance on Social Media The 81-year-old brand saw an opportunity to better engage its young audience using influencers and social media By Sarah Steimer | Staff Writer

 ssteimer@ama.org Goal There is a particular octogenarian teens love, and we’re not talking about William Shatner. It’s the Kit Kat. The Hershey Company recently learned that much younger generations—Generation Z and young millennials, in particular—really love the 81-year-old product. “When we looked at who was consuming our products, we were pretty

surprised by the percentage of people who were younger,” says Ian Norton, director of Kit Kat and PayDay at The Hershey Company. “As we look at the other brands in the category, we definitely skew much younger than those brands do.” According to Norton, Hershey saw the data and considered it an opportunity to take Kit Kat’s iconic positioning around breaks—as referenced in its “Gimme a Break” jingle—and update it for a younger

audience. It wasn’t just the jingle that could use an update, though: the concept of breaks has changed as well. “It used to be this extended break that you take, and now it’s the expanse and number of different ways in which people engage in media,” Norton says. “It was an opportunity for us to not only modernize our campaign but modernize how we communicated with our consumer.” Norton says the value of the break remains, whether it lasts three seconds or 30 minutes. With modern technology, breaks usually occur when people consume social media. “It’s what you do to refocus, to recharge and get back to what you were doing,” Norton says. “We talk about it as internet content—something that’s fun, easily digestible and easy to understand.” Action Hershey began its latest Kit Kat campaign in June of 2016, focusing on developing

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content that people would look for when taking their frequent breaks throughout the day. Dan Tirol, senior marketing manager for Kit Kat and PayDay in the U.S., explained the company’s goals were twofold: The first was to increase the amount of social commentary on the brand among the target audience and engage with them. The second was to make Kit Kat the preferred brand of Gen Z and young millennials. “We obviously have our TV media, but in addition to that we established all of our social platforms that we didn’t have much of a presence on before,” Norton says. “We were establishing a strong presence on Facebook, on Instagram, on Twitter. We were also doing a project to engage with local influencers to see if there was a way for them to become brand advocates for us.” One such influencer came to the brand by accident. A freshman student at Kansas State University tweeted a note he found in his car from an anonymous thief who stole nothing else but a Kit Kat from the student’s cup holder. The viral tweet made its rounds, and the Kit Kat team at Hershey took note. They responded by sending him 6,500 Kit Kats to fill his car. The story made quite a few rounds on the internet and spawned the #KitKatThief hashtag. The biggest brand advocate for Kit Kat, however, turned out to be mix-tape artist Chance the Rapper, who reworked the “Gimme a Break” jingle for the brand. “He fit really nicely with the break concept because we identified him as someone who was on the cusp of breaking out in his career,” Norton says. “We also wanted to align with someone who passionately loved candy, has sung about candy, has candy references a lot in his songs. We felt he was very relevant and of the generation we wanted to speak to.” Dressed in a bear suit, the “Sunday Candy” rapper was featured in a commercial shopping for Halloween candy, where his likeness, “Chance the Wrapper,” sings the reworked jingle from a Kit Kat wrapper. A full-length, 30-second spot features Chance without a costume and is the first to include the entire song in

a commercial in nearly 20 years. The jingle itself turned 30 years old in 2016. When Chance tweeted the commercial out to his 3.47 million Twitter followers, his fans were greeted with personalized responses from Kit Kat’s Twitter account. The brand inserted users’ names on a photo of the candy wrapper. For example, “Terry the Wrapper.” The fact that Chance hasn’t signed with any major label and creates and distributes his own music sparked the idea for Hershey’s next phase of the campaign. The company partnered with musical. ly, a social media platform designed for creating, sharing and discovering short music videos. The partnership led to a four-day musical #KitKatChallenge that began on Thanksgiving Day 2016 and featured influencers Alli Fitz (@Allicattt) and Bart Baker (@bartbaker), who have 2.28 million and 4.29 million followers, respectively, on the platform. The two personalities launched the challenge by creating humorous callto-action videos that encouraged musical.ly users to take a break and create their own version of Chance’s Kit Kat

Company

The Hershey Company Campaign timeline

Initial phases ran from June to November, 2016. Results

#KitKatChallenge was nominated for a Shorty Award for Multi-Platform Campaign, Emerging Platform and Branded Content; gained more than 96 million campaign views and received more than 60,000 total challenge submissions on musical.ly. Kit Kat grew top-line sales almost 6%.

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jingle. A scroll through some of the videos tagged #KitKatChallenge includes mother-and-son duos, a grandmother in oversized sunglasses and heartfelt crooners. “For the past few years we’ve been trying to talk to our consumers on more established channels,” Tirol says. “With this campaign, it was the perfect way for us to test other avenues that were new and different, where we knew our consumers were breaking in. The fact that we have a jingle and the fact that musical.ly is all about music was kind of perfect.” The decision to rework the jingle, though, didn’t come easily. Norton says there was some debate within the company, but they ultimately decided it was an opportunity to allow the customer to own the music. “The power of the jingle, for us, is that we know it’s a really strong tool to use in our strategy and communications going forward because the words themselves are very recognizable and there’s a lot of different ways you can treat it to keep it contemporary and fresh,” Norton says. Result Each component of the campaign has been successful. The #KitKatChallenge, which gained more than 96 million campaign views, was nominated for a Shorty Award. From a social impressions standpoint, which Norton says was a major part of modernizing the brand and building social commentary, the campaign did extremely well. The campaign received 60,000 total challenge submissions on musical.ly, which exceeded the campaign’s goal by 20,000 videos. Sponsored videos garnered 1.6 million views and challenge submissions received 21.7 million views. “The results of the campaign have been terrific for the business,” Norton says. “We grew the Kit Kat business’ top-line sales almost 6% last year, which is about 10 times what the category grew.” Tirol adds that Kit Kat became a trending topic on both Twitter and Facebook, both for the ad featuring Chance the Rapper and for the #KitKatThief. He calls it a testament to the Kit Kat team’s understanding of what its customers like and what would engage them. m April/May 2017 | marketing news

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core concepts

Where Does Convenience Turn Creepy? Geotargeting, also known as location-based marketing, offers customer data in real time. However, frivolous use of data may scare more customers than it attracts. Marketers must find a sweet spot between personalization and surveillance. By Hal Conick | Staff Writer

 hconick@ama.org

here’s a whole ocean of data under the feet of marketers, bubbling and ready to burst like a well of oil. In 2015, nearly 1 million new mobile social media users were created each day, according to We Are Social—that’s an average of 12 new users per second. In 2016, 76% of American Facebook users checked their account each day, according to Pew Research Center, creating data, liking and commenting along the way. By 2020, there will be 2.87 billion smartphones worldwide, eMarketer reports. Of these devices, a report from

Pew finds it likely that 90% will have location services turned on—giving marketers the ability to track every step users take. Perhaps the most powerful way to take advantage of this geyser of customertracking data is geotargeting, also known as location-based marketing. Datafocused marketers salivate at visions of sending a notification to smartphones as soon as customers pass by a shop, increasing ROI and perhaps nabbing a long-overdue promotion. But customers can be creeped out when brands cross the thin line between

knowing them like a friend and knowing them like a stalker. Customers walking into one section of Walgreens, for example, and receiving a notification on their device that tells them to head over to another section of the store may find the corner shop’s level of knowledge a bit unnerving. “I don’t know if you’ve experienced what that’s like when you go into a store but it’s a little creepy, and it is kind of annoying to the consumer,” says Michael Jones, North American general manager of retail merchandising network Anatwine. “There’s a delicate balance.” Data collectors may feel a sense of awe at this delicate balance, not to mention the level of data they now have access to, but the reciprocity with and trust of consumers lies in protection of this oceanic ooze of data. VIZIO, a producer of smart TVs, paid $2.2 million to settle charges from the Federal Trade Commission and the Office of the New Jersey Attorney General after VIZIO collected viewing data on 11 million consumer TVs without consent. Geofeedia, a social-media monitoring platform, passed locational data about people at protests and large gatherings

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to the Chicago Police Department. The Chicago Tribune reports that after the ACLU revealed Geofeedia’s interactions with the police via a document dump, the company cut 31 of its 60 employees. However, there are also many useful, convenient ways to use locationbased marketing. Marissa Tarlton, CMO of coupon-code conglomerate RetailMeNot, says her company has geofenced all major shopping areas in the U.S., or set up a radius of space around shops wherein customers who a have a business’ app or a device capable of receiving messages automatically receive notifications from businesses. She says more than half of RetailMeNot’s customers provide location data and in return receive “relevant, timely content targeted to their preferences.” RetailMeNot’s retail customers are seeing a tenfold return on investment with its new mobile attribution system. In Tarlton’s view, mobile is “the link between digital and physical worlds.” Clearly, there’s a line between accruing insights and intruding on customer privacy; the reputation of the brand lies on that line, as marketers look to land on the side of great geotargeting rather than careless creepiness. Know What You’re Getting Into Before adopting new technology, marketers must learn how and why it works. Location-based marketing has two broad use cases, says Greg Sterling, vice president of strategy and insights of the Local Search Association: One use case is geofencing, the other is behavioral targeting, which tracks consumers’ location and analyzes where they go. The latter should sound familiar to anyone who has tracked consumer web browsing with cookies. “Let’s say I’m McDonald’s and I want to see how many of my customers also eat at Chipotle because I’m trying to understand who my competitors are,” Sterling says. “I can figure out who has come to McDonald’s and who has also gone to Chipotle within a certain period of time in the aggregate.”

Even without consumers registering and signing in, Sterling says businesses can figure out who went to both restaurants in a window of time and analyze data like gender, age and zip code by looking at aggregate data. This may help determine what percentage of loyal McDonald’s customers are also eating at Chipotle, for instance. “I’m identifying their audience and advertising to them at some point later,” he says. “I can also identify an audience and advertise to them in real time so I can combine the methodology. I can figure out who goes to fast food restaurants more than once a month, and I can target them when they’re in competing fast food restaurants.” Start With the Customer To marketers eager to try something new, geotargeting often looks like a shiny ball, says Jones: distracting, but with no discernable purpose. Instead of focusing on what technology to adopt, Jones suggests companies start by questioning the value brought to the customer. One example of this again rests on the back of Walgreens and its more than 8,000 U.S. locations. In a city like New York, for example, people likely come out of the subway within walking distance of a Walgreens. Jones says location-based marketing could spot these customers and offer them a coupon to get them into the store. This is a simple but useful method to use a retail store’s large footprint. It’s a noninvasive introduction to the value of geotargeting for the customer. Don’t Take Advantage of Data Privilege Access to a customer’s phone—with all of its photos, phone numbers and personal information—is a privilege that should not be taken for granted. Jones says marketers must think about the value they are providing to customers in this trade of privacy for convenience. Both Groupon and Yelp have been good examples of providing value to customers, Jones says, as they first ask the app downloader to turn on location

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services so they can receive more accurate information. For a customer walking down the street and looking for a restaurant, being able to see what’s in proximity from Yelp or what deals are nearby in Groupon is enough of an incentive to keep location services on. When this privilege is not respected and notifications begin randomly popping up at every street corner, brands may lose customers. “That’s the key: Put yourself in your consumer’s shoes and ask if you are driving some kind of value by asking them to give up more of their privacy,” Jones says. If consumers find themselves swiping away notifications, they’ll likely be annoyed by the sender. SMB Marketers May Have to Wait SMB marketers can use geotargeting, too—any business can, Sterling says— but they may have a hard time finding a meaningful use case. “The paradox of real-time targeting is that it can be very personalized, very customized and can capture people with very high intent—somebody at the mall is likely to be shopping for stuff in the stores at the mall,” he says. “But the audience sizes go way down if you’re doing real-time [targeting] in a very specific place. It has high conversion, but low audience reach. … Small businesses can use it, but use cases for them are narrower.” For example, a small retail chain with an app can send a welcome message with coupons to anyone who comes into the store, but it will be harder to get value. When it comes to geotargeting, Sterling puts it simply: “Scale matters.” It’s still early for location-based marketing, and brands are still learning where the line lies between valuable and vexing. As they work to delineate the line, Jones says geotargeting technology will continue to improve and, before long, become a marketing mainstay. “When so many people are relying on their phones and want information, it’s just a matter of time before it becomes something that both sides learn how to use,” Jones says. m April/May 2017 | marketing news

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ama intelligence

the middle market

Is Your Working Capital Working For or Against You? A closer look at working capital could pay big dividends in cash flow and valuation By Zach Brooke | staff writer

 zbrooke@ama.org

new report on working capital management finds that many middle market businesses may be missing out on opportunities to boost business valuation and performance by

being complacent with their cash flow, despite reporting high levels of satisfaction with how their resources are pooled. The report by the National Center for the Middle Market surveys the attitudes

of decision makers regarding their organization’s management of working capital, or the timeframe and manner in which it collects and divides resources. There are three main components to working capital: payables (what a business owes), receivables (also known as collections) and inventory. “In the ordinary course of business, [working capital is] money that you have tied up doing the things you need to do,” says the center’s executive director, Thomas Stewart. “If I’ve billed you, and I haven’t gotten paid yet, that is my money that is tied up waiting while the check is in the mail.” According to this report, three-quarters of respondents say they are either very or extremely satisfied with how their business manages its working capital. However, when the report benchmarked

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the middle market

responses against financial performance for publicly traded middle market companies, it found the fastest-growing middle market companies were managing their working capital much better than their more modestly performing counterparts. Moreover, the lopsided advantages were consistent among companies across all industries and all of the tiers within the middle market. “That was stunning to us,” Stewart says. “We had two sets of data. One was the survey that said 75% [of respondents] were very or extremely satisfied, and then we had the benchmarking data from public companies that showed that on every one of these parameters, the differences between companies at the 25th percentile and companies at the 75th percentile … were two to four times [greater].” The effects of working capital management on operations flexibility is outlined in an example provided by the report authors using a fictional company called Hypothetical Materials, which earns $100 million in annual revenue. If Hypothetical Materials was in the 25th percentile compared to its peers, the average wait time before getting paid would be more than seven months, or 225 days, and the company would have $61 million in revenue suspended in receivables at any given time. At the same time, Hypothetical Materials pays its own bills in 121 days. This means cash is flowing out from the company at a rate much faster that it’s coming in, significantly reducing the opportunities for growth and reinvestment, and increasing the probability of a situation where the company must operate on credit to remain solvent. If Hypothetical Materials was instead operating in the 75th percentile for working capital management, it would be getting paid in less than three months, and would only have approximately $32 million awaiting payment in receivables at any given time. Its accounts payable, meanwhile, would essentially double to 240 days. This allows the company to have much more cash on hand at a given time for future operations and investment. “Most companies are unaware of how big of an opportunity they have to free up money,” Stewart says.

Granted, a leap from the 25th percentile to 75th is bound to have a pronounced impact on the bottom line, but the report also found that even edging working capital metrics by as little as a day in favorable directions can free up substantial amounts of cash baked into a longer revenue cycle. A one-day tweak to either accounts payables or receivables will unlock an extra $260,000, while nudging both buckets by a single day will boost liquidity by nearly $800,000. Another of the report’s contributors, Jason Cagle, head of sales for treasury and payment solutions at SunTrust Bank, says he’s seen middle market businesses ignore opportunities to improve their working capital efficiency because they feel it’s immaterial to the majority of what they are about as a company. “The great irony is that [working capital] is the center of the conversation,” Cagle says, noting that improvements in working capital are a crucial component of garnering maximum corporate valuation. “All the private equity shops—it sounds really complex and sophisticated—[but] all they are really doing is looking at businesses … where they see inefficiencies or growth opportunities. They buy them, and then they bring in a really good operator to accelerate days receivable, extend days payable, and therefore improve free cash flow and drive up the enterprise value so they can flip it and make a buck,” he says. Even for a middle market company not looking to optimize its valuation or aggressively reinvest capital earnings, ignoring opportunities to massage cash flow is quickly becoming akin to leaving money on the table, Cagle says. That’s because rising interest rates are allowing high-balance savings accounts to generate a marked return for the first time in recent memory. “In a low-rate environment, nobody has this burning desire to sit on cash because they’re not getting paid anything in the way of interest,” Cagle says. “For the first time in 10 years, we’re truly moving into a rising-rate environment.” Ultimately, the paper argues it is up to the owners and executives of middle market business to develop a culture of working capital efficiency within an organization.

ama intelligence

For many, that means caring about more than just the bills being paid. Instead of being attuned with traditional logic of writing off debt as fast as possible and building up large inventories, a concerted effort should be made to reverse this point of view. The longer a business’ repayment terms and the leaner its inventory, the more wealth it keeps at its disposal. Yet, because this goes against many tenets of personal finance, Cagle notes that many CFO-level decision makers are not incentivized to be proactive in these areas. “There’s this massive institutional inertia to, ‘do things like we’ve always done it. Because if we take a risk and get it wrong, that’s bad for me. But if I do nothing, that’s good. I’m fine,’ ” he says. The report includes suggestions for implementing best practices regarding working capital management within organizations. Some are a matter of routine—such as taking advantage of the full payment period for bills, drawing down overstocked inventory levels or switching to electronic payments for quicker receivables—while others are more focused on fostering a culture of working capital prioritization. Long-term recommendations include setting KPIs for payables, receivables and inventory, and looking outside the organization to benchmark company performance against data from similar publicly held companies. Also, since many middle market companies are vendors that sell to larger entities, Stewart recommends being hawkish with buyer payment terms. “Some of these [large companies] put on some very tough terms on payment. Fight back,” he says. Ultimately, there will need to be a sustained, coordinated effort within an organization to achieve improvement in working capital management. Fortunately, Stewart says, that’s where marketers may help by telling the story of strength and advantage that comes from being in control of working capital. “Marketers tend to be more interested in spending money than saving money,” Stewart says, “but … I think a smart CFO could reach out to a smart marketing person and say, ‘How do we tell this story and get our employees fired up?’ ”m April/May 2017 | marketing news

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scholarly insights

The Value of a Facebook Fan Modern marketing plans demand a social media presence, but how much ROI can marketers expect from cultivating an online fan base? By Leslie K. John

ompanies spend billions of dollars each year to establish and maintain a presence on social networking sites. Given the substantial investment of time, money and firm resources spent to accumulate likes on Facebook, marketers are increasingly asking themselves, “What is the value of a Facebook fan?” In a recent article published in the Journal of Marketing Research, my colleagues and I address this question by assessing whether joining a brand’s social network changes consumer behavior. We look at both the consumers who join (i.e., first-order effects) and their friends (i.e., second-order effects). And the punchline: Joining a brand’s social network induces no change

in consumer attitude or behavior; it is simply a symptom of preexisting fondness for the brand. There is an inherent appeal to the idea that recruiting new followers in social media translates into positive marketing outcomes such as improved brand attitudes and sales. However, evidence to support this assumption has been elusive. A recent survey shows that 87% of Fortune 500 CMOs have not been able to document whether social media creates new customers. Adding to the confusion, red herrings abound: Associations between social media engagement and offline behavior are often taken as evidence that acquiring likes—or more broadly, obtaining social

media followers—boosts the bottom line. An influential Starbucks study published in the Journal of Advertising Research seemed to “confirm” this. People who had subscribed to the brand’s Facebook page spent more and transacted more frequently than those who had not. Case closed, right? Not by a long shot. These observations are plagued by a fatal logical flaw: They confuse cause and consequence. When we see the association—e.g., fans spend more than nonfans—it’s tempting to chalk it up to causality and conclude that social media engagement causes positive marketing outcomes such as improved brand attitudes and increased purchasing. In other words, becoming a fan makes a person buy more than she otherwise would have. But surely those with a positive predisposition toward a brand are more likely to follow it relative to those without such feelings. In other words, both purchasing and following a brand on social media are, at least to some degree, symptoms of a person’s fondness for that brand. In this case, following a brand wouldn’t cause the person to buy any more than she otherwise would have. So how much, if any, of the positive associations between following a brand on social media and offline behavior is truly causal? This distinction is not trivial. For marketers on social media, disentangling cause from consequence is important because it points to different best practices for social media use. If there is a causal element to this association, then it’s reasonable to expect that recruiting followers will have a positive effect on sales. To capitalize on it, a marketer would want to proactively get people to join the brand’s social media channels—for example, by offering them incentives to join. However, if there’s no causal relationship, it would be unrealistic to expect recruiting followers to boost sales, at least without any supporting marketing activities. In this case, the marketer may be better off using social media as an organic way of finding their best customers. In other words, dangle the brand out on social media and let your best customers find you. m

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mba perspectives

The Algorithmic Customer Experience How data-informed customer experiences can shape customer identity By Jules Chirol, Minni Kuusisto, Lorna Liu and Durriya Zaidi

ecommendation systems use consumers’ behavior on a digital service to anticipate their next move. Companies such as Spotify, Google and Amazon all base a major part of their services on algorithms that form a recommendation system. The many successful examples in today’s marketplace support Lauren Smith’s argument made in “Algorithmic Transparency: Examining from Within and Without,” that the marketplace is shifting from “meet demand” to “on demand,” and the future is moving to “know demand,” which is not only about predicting what consumers desire, but creating these needs and wants.

Based on the research of OestreicherSinger et al. in their paper, “The Network Value of Products,” recommendation systems actually form a product network of the company’s offering. This network works much the same way as Google’s PageRank algorithm, recommending products that have the most links from the products that have been previously examined or consumed. Based on this logic, the authors suggest that the value a product creates for a company should not only be considered as the intrinsic value based on its revenue implications, but should also incorporate its ability to lead customers to other products via recommendations (i.e., the value it receives from, and contributes to, the network itself).

By considering both the product’s network and its network value when developing an offering and marketing mix, companies are able to create more value for customers, and by extension for themselves. This value is created not only through broader and more insightful offerings, but also with better recommendations. This has far-reaching implications in the entire supply chain when—using retail as an example— manufacturers’ products are more easily found by customers or just more accurately valued. A clear range of benefits for consumers can be found in having access to a more accurate product portfolio and a personalized path through the aisle of a digital retail store. In fact, by providing a personalized experience, a successful recommendation system helps to reinforce consumers’ identities by repeating their previous behavior. This is the case especially in the field of digital music and books, where the product itself helps to shape and reaffirm one’s identity. Also, the algorithmic experience is such that consumers develop a relationship with it, feeling as though it knows them and their preferences very well. However, the growing concern over data privacy cannot be overlooked. Policymakers have conducted extensive research in the last two years, looking into the advantages and disadvantages of Big Data analytics. In the marketplace, a glaring contradiction exists among consumers who are concerned about their privacy yet freely give away their information online. When examined from this perspective, companies such as Google, Spotify and Amazon are serving as identity-enhancing mechanisms that help consumers cope with the anxieties caused by the contradiction between the benefits gained from personalized experiences versus the pitfalls of privacy-related issues. For a company to place itself at a central point of the customer’s life, it has to narrow the gap between these privacy concerns and the vision of algorithms enhancing our everyday lives through better online customer experiences. The rewards of doing so are boundless. m

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executive insights

CrM

How Does a Brand regain Trust? Crisis communications can’t be the only tactic firms use to smooth over breaches of customer trust. They need to deploy a thoughtful combination of programs and messaging that conveys a higher purpose.

by david aaker

 daaker@prophet.com

hat can be done to regain brand trust when it has been damaged by a real or perceived misstep? What preventative measures can be taken to create an organization where such errors are less likely, and customer understanding and forgiveness is more likely? Many brands have faced this challenge, some very recently, such as Volkswagen, Wells Fargo, Toshiba and Samsung. There are many tactical prescriptions for dealing with a trust-damaging crisis, but there should also be an effort to change the conversation, to have something to talk about besides the crisis. Toward that end, there are three courses of action brands should take to address or prevent a crisis: 1. Create a higher-purpose mission, value set or culture that will enable the organization to have meaning apart from generating sales and profits. 2. Develop a higher-purpose program that not only engenders trust but can redirect the discussion during a crisis incident. This should be branded and leverage the organization’s people and assets toward social good. 3. Distribute messages about the brand’s higher purpose using stories of real people. A case study written by Tom Roach of BBH London describes Barclays’ response to its brand crisis following the 2009 financial crash.

In June 2012, the brand received a fine for falsely reporting the interest rates it was paying to other banks, which made its financial position appear better than it was. Although many global banks were investigated and punished for doing the same thing, Barclays was the first and assumed to be partially responsible for the financial collapse. The result was a plunge in Barclays’ trust level as measured by the Millward Brown brand tracking study. Already low, it plummeted during 2011 and 2012 by 40% (compared to 9% among competitors). Barclays, the leasttrusted brand in the least-trusted sector, decided to change. A new Brand Purpose In February 2013, the Barclays Group CEO announced that the company would dramatically change and assume a new brand purpose: “Helping people achieve their ambitions—in the right way.” To support the new brand purpose, Barclays developed five brand values, including respect for employees and stewardship. A new evaluation system and extensive training of 140,000 employees linked to the new brand purpose transformed the culture of the firm. new Programs The newly empowered and inspired employees created and led dozens of higher-purpose programs on their own. One, created by 12 colleagues calling

themselves the Digital Eagles, centered on upgrading employees who were lagging in digital skills. The program now has 12,000 employees involved and has expanded to teach those in the public about thriving in the digital world. They sponsor “Tea and Teach” sessions where people can learn in informal settings. The Digital Eagles also have an online program called Digital Wings that allows people to grow from “newbie” to “brainbox” levels in a series of courses. Another set of employees helped bring the bank into the Dementia Friends framework so customers with memory issues could be served. There is the “Banking on Change” program, which partners with two charities that encourage people in underdeveloped countries. The benefactors, who typically live on less than $2 a day, learn to take a savings-led approach to microfinance. In six years, the program reached 750,000 people who saved an average of $58. new Communication Product-based communication was replaced in June of 2014 by a campaign to shine a light on Barclays’ higherpurpose initiatives using, where possible, real stories of real people. The focus was on four programs under an umbrella concept: making sure that everyone is moving forward in the digital revolution and no one is left behind. In addition to Digital Eagles, three other programs were featured. Life Skills gives young people the skills they need to get jobs in a digital workplace using a free, in-school and online learning program. Fraud Smart gives free help and advice to people who need to keep money secure in a digital world. The Code Playground teaches kids ages 7 to 17 the basics of computer coding in Barclays branches. The stories made the difference. Steve Rich, 50, lost his ability to play soccer because of a car accident but could play a modified walking version of the game and again experience the wonderful feelings that came with participating. He wanted to give as many people as possible the chance to share in that

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feeling. Inspired by a 2014 Barclays Digital Eagles TV advertisement, he decided to turn the adaptive sport into a nationwide game and raise awareness. With the help of Digital Eagles, Steve created a website that connected more than 400 teams across the country. “Through Barclays Digital Eagles I’ve even managed to get in touch with some of my old football mates who turned up for the game,” Rich says. “I’m very grateful that Walking Football has helped me continue my passion for the beautiful game.” A woman named Zena tells of her son Paris preparing for the workforce with LifeSkills. It started with the Wheel of Strengths. After identifying the strengths, interest and personality traits that best describe Paris, the types of jobs he is best-suited for were suggested. Then came the résumé building with guidance

and tips to format a résumé that will be compelling and relevant and a structure that made it easy to create. Finally, there was the mock interview activity with a chance to practice that pushed him to think about likely questions and provide the critical confidence level. The result was an interview with one of his top target firms. From the start of the campaign in the summer of 2014 until early 2016 most key indicators of customer relations were up. In particular, trust was up 33%, emotional connection was up 35%, net promotor score was up 300%, and consideration was up 130%. The result was dramatically different than that experienced during the previous product campaign. For example, the new campaign drove six times as much trust gain and five times as much consideration as the

executive insights

product-focused campaign. The four programs also featured large measured responses. The Digital Eagles effort and the Code Playground campaigns each resulted in more than 120,000 unique visitors to the webpage and 1.5 million video views. Since the campaign, these numbers are many times higher. The press is also less critical. By 2015 Barclays received 5,000 positive mentions in the press, including 600 mentions about Life Skills. Barclays recovered brand trust by deploying a culture change that empowered and inspired employees to create higher-purpose programs brought to light with real people’s stories. m David Aaker is vice chairman of Prophet, the author of Aaker on Branding and a member of the NYAMA Marketing Hall of Fame. April/May 2017 | marketing news

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executive insights

branding

‘Buy American’: A Branding Toolkit Managers of brands big and small, local and international can leverage the nationalist sentiment swaying consumers’ purchases

By Vikas Mittal

 vmittal@rice.edu

ccording to a 2015 Consumer Reports survey, nearly 80% of consumers say they would rather buy an American-made product than an imported one, and 60% are willing to pay 10% more for it. In his 2017 inaugural address, President Donald Trump vowed to “follow two simple rules: buy American, and hire American.” Organizations such as the Buy American Movement— which was founded on the premise of promoting American-made goods and services—are also gaining popularity. But buying American is not just a matter of price and quality. Decades of research has identified four drivers of country-based branding: country branding, country animosity, consumer ethnocentrism and local identity. How can brand managers leverage these drivers to build on the “Buy American” movement?

Country Branding

A product’s country of origin is known to affect people’s opinions about the product. Consumers hold certain beliefs and associations about a country’s capabilities, its state of development and its relevant history. These associations can affect whether consumers view products associated with that country in a positive or negative light. For example, a French wine’s association with France will likely lead us to the conclusion that it is of a higher quality than a wine from India. Likewise, Italy’s brand is associated with

high fashion and quality clothing. These associations are rooted in our perceptions of countries’ brands, what they are known for and what they’re trusted for. A broad analysis of 41 different country-of-origin studies shows this effect is most pronounced when it comes to consumers’ quality perceptions. For example, American consumers’ faith in the quality of products designed and assembled in the U.S. is generally higher than it is for products designed and assembled in other countries. Consider the results of a 1998 study that assessed the impact of NAFTA: Consumers uniformly gave higherquality ratings to a TV they were told was designed in the U.S. than to a TV they were told was designed in Mexico. Brand managers can define and highlight specific attributes of quality, reliability, design and innovation that are associated with the U.S. For example, many companies conduct quality and design work for their products in the U.S. but don’t highlight this phase of development to their customers. Doing so could help them capitalize on the U.S. national brand and increase perceived quality.

Country Animosity

Historical interactions between nations can promote and cement feelings of animosity—both economic and militaristic. For example, a study of Chinese consumers published in the Journal of Marketing shows that their animosity toward Japan negatively

affects their evaluations and willingness to buy Japanese brands. In another study, French consumers’ animosity toward the U.S. was shown to negatively influence French attitudes toward iconic American brands such as Kellogg, Heinz and Ford. A 2015 study shows that American consumers’ animosity toward Russia has led them to avoid many Russian products, irrespective of their judgements of product quality. Animosity toward a country is a potent and often deep-seated emotion that can be difficult to reverse. Marketers should use consumer research to determine associations related to country animosity and carefully position their brand to minimize any negative effects. For example, Tiffany & Co. has had a strong presence in Russia since 2013 and in China since 2008. Yet within the U.S., Tiffany deemphasizes its presence in both countries to avoid spillovers of country animosity.

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executive insights

means paying more for certain products and services. Thus, local identity operates at a local and regional level, while ethnocentrism operates at a national level. Consider the 95 million-plus customers who shopped at neighborhood businesses for American Express-sponsored Small Business Saturday. That is not a small niche of well-intentioned consumers pursuing an obscure cause. That is a major movement driven by consumers’ strong commitment to local identity. In addition to promoting their brand’s association with America at the country level, brand managers can highlight local aspects of their products. For example, Shinola proudly promotes its roots in Detroit and Ben & Jerry’s celebrates its association with Vermont. Brand managers can clearly associate their products with regional and local communities and attach their brands to causes that support and nurture this sense of local identity. The key is to stay local, even while selling nationally.

Consumer Ethnocentrism

Consumer ethnocentrism is the belief that it is fair, appropriate and moral to buy products made in one’s own country because it supports domestic jobs and helps the economy. A higher level of ethnocentrism among American consumers motivates them to buy American because of a sense of fairness to American workers and a desire to promote the American economy. To leverage ethnocentrism, brand managers should strategically link their brand to domestic jobs, to growth in the domestic economy and to a general sense of fairness. Consider foreign-based companies Toyota and Honda as examples: To capitalize on the ethnocentric tendencies of U.S. consumers, both companies have worked through difficult periods to successfully rebrand themselves as key producers of American jobs and as positive contributors to the American economy.

In fact, the top five vehicles in the 2016 American-Made Index by Cars. com were produced by Toyota and Honda, with Camry and Accord enjoying the top spots. Featuring this success prominently in their positioning and branding has helped Honda and Toyota dominate the U.S. market.

Local Identity

Consumers’ local identity is the extent to which they identify with their local community rather than the larger, global world. Forthcoming research in the Journal of Marketing shows that consumers with a strong local identity are more invested in local causes and are willing to pay more for locally sourced products. Compared to ethnocentric consumers, consumers with a strong local identity are not necessarily motivated by the entire U.S. economy. Rather, they find local causes worth supporting—even if that

‘Buy American’ Branding: Start With Your Consumers Leveraging the “Buy American” positioning will require managers to plan carefully. The planning process will start by surveying customers to bring greater clarity to important nuances: How much do customers care about local versus national causes? Is the customer base driven more by ethnocentrism, local identity or perhaps both? What are the different countries with which a brand is associated? How do customers feel about those countries? Do these countries impart a positive or negative spillover to the brand? If a brand is multinational, what perceptions do customers have about the different countries in which the brand has a presence? A better understanding of these nuances—gained through customer surveys and critical observations—will provide a roadmap for brand managers to maximize the impact of “Buy American” positioning. m Vikas Mittal, Ph.D., is a member of the faculty at the Jones Graduate School of Business at Rice University in Houston. April/May 2017 | marketing news

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executive insights

social roi

Holding Social Media Marketing to a Higher Standard With few concrete measures of social media’s effectiveness, its accountability as a loyalty driver must be evaluated by more than likes and retweets

By Lawrence A. Crosby

 lawrence.a.crosby@gmail.com

t is common to think of social media marketing as a tool for attracting customers. However, few firms measure the effectiveness of social media precisely, and recent articles have even questioned the value of likes. I’d suggest that social media marketing should be evaluated through a customer engagement lens. In a May 2013 Marketing News column, I defined customer engagement in terms of “active involvement,” suggesting it can lead to “deep commitment” through the customer’s progressive investments in the relationship. I believe that social media marketing should be held to a higher standard than conventional media given its ability to affect the entire engagementcommitment continuum. People are drawn to social media sites by a common interest or a need that’s often neither product- nor brandspecific. The marketer’s challenge is to transfer some of that engagement to the brand. This is easier when the site is brand-affiliated, as in owner/user forums or company Facebook pages. In some cases marketers can pull the community together and can join the dialogue. Perhaps the first step toward brand engagement via social media is engagement with brand-related content (consumer- or companygenerated), which can be assessed by a

variety of metrics: shares, comments, followers, subscribers, impressions, click-throughs and links. Ideally, social media marketing can also broaden brand engagement by stimulating interactions in other touch points, both online and offline. This might involve driving prospects to the company’s website, encouraging telephone contact or inspiring a store visit. This is all trackable today. A desired effect of this brand engagement is a stronger affinity for the brand, although it’s not always clear whether the referent of a like is the specific content or the brand itself. However, the same ambiguity exists in a consumer’s attitude toward an ad versus attitude toward the brand. When I speak of holding social media to a higher standard, I’m also referring to its impact on customer loyalty. It’s not just about what consumers or B-to-B buyers think and feel, it’s ultimately about what they do. I conceive of loyalty as a behavioral predisposition that is reflected in a constellation of behaviors rather than a single act. What are these behaviors and how can social media contribute? Trial is a necessary step toward behavioral loyalty. By virtue of its marketing intelligence function, social media can provide valuable guidance on how to convert prospects to customers. Marketers can assess the tone of the conversation about the

brand, identify likes and dislikes and spot barriers to purchase by using tools such as sentiment analysis, text mining and pop-up surveys. As for triggering conversions, a recent edition of Harvard Business Review offers evidence supporting a pull/push approach whereby potential customers are drawn to social media on their own, possibly endorse the brand and then receive targeted digital advertising and offers. Many equate loyalty with repeat purchasing. In this regard, social media has a key role to play in dealing with customers who are “negatively engaged.” Not everyone on social media who is posting, commenting, retweeting or rating the brand is a happy camper. While it is important to track user ratings when they are provided online, it is critical to address the actual problems and complaints that customers express. Perhaps it’s useful to think in terms of the five P’s of social care. The first is to participate in social media by listening for customer issues and offering solutions and help channels (e.g., websites, forums, YouTube videos, phone, e-mail, chat, etc.). This needs to be supported by a platform—the second P—that integrates social media with those other channels and, as customer service software company Zendesk suggests, is capable of turning conversations into customer service tickets. But that also requires the third P—prioritization—to know when urgent action is required and escalation should occur. The fourth key ingredient is people who are comfortable with social media, have the necessary technical and soft skills and are trained in problem resolution. Above all, there needs to be a well-thought-out and closely followed customer service process, the fifth P. After repeat purchasing, the most commonly cited loyalty behavior is referral, which acknowledges the power of social influence and word of mouth. Net promotor score, which measures a consumer’s willingness to recommend a product or brand, is a popular customer loyalty metric. This is an area where we would expect social media to really shine. There are many examples of referral marketing programs

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social roi

that have been enabled by social media, including Airbnb. Success requires a trusted source who uses the product, is cognizant of the recipient’s interest and needs and is incentivized to make the recommendation. But there are also examples of lessorchestrated viral campaigns—like the Dollar Shave Club—that mainly include a clever idea coupled with an eminently shareable video. Consider the recent groundswell of interest in The Baby Box Company. Inspired by a 75-year tradition in Finland (which has one of the lowest rates of Sudden Infant Death Syndrome), the product concept is a simple cardboard box, mattress and fitted sheet that becomes the newborn’s crib for the first six months. Shareable content includes news coverage of The Baby Box Company’s partnership with hospitals to give the boxes to new parents for free. Of course, it is possible

to buy the product online, perhaps as a gift. In this case, the referring sources don’t need to be users themselves; a concerned grandparent will do. There are numerous other loyalty behaviors that social media can positively influence. A firm faced with a product recall might use social media to reach out to unregistered owners to bring their product in for repair. In terms of inducing customers to “buy more,” social media might be used to illustrate novel features of the product or service. The notion of collaborative behavior whereby customers are encouraged to join product development discussion groups or to relay improvement suggestions is heavily touted. And one of the greatest ways to stretch the marketing budget is by leveraging user-created content. My personal favorites include YouTube videos providing instruction

on my software programs and technical devices. It behooves marketers to catalog such user-created content and provide links to the most accurate and helpful material. While I’m not a digital native, I have come to appreciate what social media marketing brings to the table. By properly leveraging these interactive, user-controlled platforms, marketers can establish and cement long-term customer relationships. With social media marketing expenditures in the U.S. expected to surpass $17 billion by 2019, it is reasonable to hold these efforts accountable for producing measurable results. m Lawrence A. Crosby, Ph.D. is the retired dean of the Drucker School of Management, a regular AMA columnist since 2000 and currently president of L.A. Crosby & Associates.

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executive insights

at c-level

Marketing 4.0 Argues the Marketplace Has Changed, and the Customer is in Control The fourth iteration of Phil Kotler’s landmark work emphasizes the convergence of new and traditional marketing to lead consumers to brand advocacy

By Michael Krauss

 michael.krauss@mkt-strat.com

ocial media is revolutionizing the marketing world. Digital marketing and technology are transforming the way we do business. Is anyone providing an assessment of the changes marketers face and a roadmap or set of frameworks and guiding principles for addressing the transformation that’s occurring in marketing? Marketing 4.0 Moving from Traditional to Digital is the guide that marketers should read. At age 85, author, researcher and the S.C. Johnson & Sons Distinguished Professor of International Marketing at the Kellogg School of Management at Northwestern University, Philip Kotler, is leading the way. Kotler, who initially codified the academic principles of the marketing profession in his groundbreaking 1967 opus, Marketing Management, continues to guide marketers in the realm of social media and digital marketing. In 2010, Kotler published Marketing 3.0, describing how marketing has evolved from product-driven marketing (1.0) to customer-centric marketing (2.0) to human-centric marketing (3.0). “Marketing 4.0 is an effort to look at marketing along a different

dimension,” said Kotler in a recent interview. “Marketing traditionally was oriented with communication being key, a one-way communication, just labeled traditional marketing. Good fortunes were built on brands that hit us continuously with Campbell’s and Kellogg’s.” But connectivity and technology have altered the way we approach marketing. “A lot of the message of the book is that any company that wants to survive has to turn to these new tools of social media and use digital media to facilitate their management of their business,” but it will still be a blend of old and new, he said. “We’re not dropping traditional marketing. We’re blending traditional and digital.”

“A lot has happened since we wrote Marketing 3.0,” Kotler writes in Marketing 4.0, “especially in terms of technological advancements.” While the technologies are not necessarily new, Kotler writes, “They have been converging in recent years, and the collective impact of that convergence has greatly affected marketing practices around the world.” Clearly the buyer has more power than ever before. Kotler believes that this technological convergence will ultimately lead to the convergence between digital marketing and traditional marketing. The purpose of the new book, Kotler says, is “that marketing should adapt to the changing nature of the customer and the customer’s paths in the digital economy. The role of marketers is to guide customers throughout their journey from awareness to ultimately advocacy.” Whether you are a marketer trained on the Hierarchy of Effects model or the newest “digital native” marketing graduate, Kotler is signaling to all marketers that there are unique paradoxes occurring in today’s marketplace. “While online businesses have taken up a significant portion of the marketplace in recent years, we do not believe they will completely replace offline businesses,” Kotler says. Similarly, today’s customer is more informed than ever before but also more distracted. Finally, brands face positive and negative advocacy and must learn to navigate this paradox. “In the context of connectivity, negative advocacy might not be a bad thing. Sometimes a brand needs negative advocacy to trigger positive advocacy from others,” Kotler says.

We need to manage through a more complex environment and enable, enlist and empower customers to communicate and advocate for the brand.

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at c-level

There are major power shifts taking place in the world. We are moving to a more horizontal, inclusive and social market landscape. Kotler explores major digital subcultures of youth, women and netizens. At the core of Marketing 4.0, Kotler provides a new set of marketing metrics and new ways of looking at the practice of marketing with an eye on improving marketing productivity. Finally, Kotler describes how marketers can implement effective tactical programs in this converging

world of traditional and digital marketing. In a recent interview, Kotler said two key principles he wanted to get across to readers in Marketing 4.0 were recognizing the alternative paths to purchase that customers take and having clear metrics at each stage. Kotler describes one of the earliest customer paths and marketing frameworks, AIDA, coined by E. St. Elmo Lewis around the need for attention, interest, desire and action. In today’s hyper-connected marketing environment, Kotler says the customer

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journey is to move from aware (I know about the product), to appeal (I like the product), to ask (I’m convinced about the product), to act (I’m buying the product) to, finally, advocate (I recommend the product). Kotler argues a new set of metrics must be managed: “In line with the 5 A’s, two metrics are valuable to measure: the purchase action ratio (PAR) and brand advocacy ratio (BAR). PAR measures how well companies ‘convert’ brand awareness into brand purchase. BAR measures how effectively companies ‘convert’ brand awareness into brand advocacy.” What’s different today is that the customer is in control, not the company. Where we might have assessed awareness, trial, usage and repeat purchase in the past, today’s marketplace is more dynamic. Buyers are constantly communicating with one another. We need to manage through a more complex environment and enable, enlist and empower customers to communicate and advocate for the brand. There’s much to be gleaned from an in-depth study of Marketing 4.0, and marketing veterans and marketing novices will find it an important read. I asked Kotler for his advice to young marketers just starting out. “If you focus only on your expertise in digital,” Kotler says, “you might come across as dismissive of management’s prior accomplishments. Play it carefully. As a young marketer, recognize your digital skills will be valuable and recognize you want to be balanced. If you focus too heavily on digital, you might end up being a specialist and never being the CMO.” Lastly, Kotler points out that business leadership is a team sport. C-suite executives are beginning to think they know marketing pretty well. Kotler encourages marketers to focus both externally on the customer and the competition and internally on the enterprise. m MICHAEL KRAUSS is president of Market Strategy Group, based in Chicago. April/May 2017 | marketing news

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generating insights

From Data Collection to Curation There is no dearth of data for marketers to draw conclusions from, but building insights that drive smart decisions is a more nuanced and valuable skill

By David Krajicek

 david.krajicek@gfk.com

y college career was a whirlwind of physics and psychology classes, but I vividly recall the one art history seminar I audited my sophomore year. The instructor made an observation that has stuck with me to this day: “Collecting is the easy part. Curating—now that is the hard part.” I am struck by how prescient this observation was—a continuing truism in the world of art, for sure, but also an emerging insight into today’s changing business and marketing environment. When we think about a curator, we typically imagine someone who can bring together paintings, sculpture and artifacts to convey a unique perspective on an artist, an era or even a social movement. But when I think about curation in a broader sense, I focus on new perspectives or ideas that arise from any combination of things, in business as well as art. As we are trying to make good decisions about where to grow business, we can collect a lot of information from various sources; lack of data is not the problem. But are we appropriately curating that information to drive a unique perspective for our brands or customers? Lots of folks can “collect” data from a number of sources and spend a few minutes lining the numbers up in parallel spreadsheet columns to create something called an integrated database. But refined data integration, the curator’s principle task and skill, requires much more. Similar to the curator of a major

Vincent van Gogh or Pablo Picasso exhibit, data curators need to follow some simple steps to elevate their work from good to great, to generate unique perspectives and insights and tell a story that resonates. Know your objective from the start. It may seem obvious, but having a clear picture of what you want to achieve is essential, and the more specific, the better. This will help separate data that is truly useful from what is simply available. Opportunism is fine, but it should not be your guiding principle. Extraneous data will just add noise to the system. Too often I see exercises in “data exploration” without a compass or end point. Don’t get me wrong, I am not against an interrogation of the data, but unstructured data-fishing often leads to dead ends or insignificant insights. Having the objective in place is also important because you need a clear understanding of how the marketing environment operates and how the sources can serve as a proxy for market dynamics. This perspective can ensure your analyses yield relevant insights. See the bigger picture with an eye toward implementation. In everything you do, think of larger contexts. How will your integrated data set be used? Who will be turning to it most often? The data sets are less important than the insights we are

looking to activate and our reason for activation. How will they be applied by your business? The curation process is almost like reverse engineering, working back from the decision, rather than from the bottom with the data. Having this sensibility is key because the goal is to drive change, not just develop an insight. Plan your analyses knowing what decisions need to be made, who is deciding and how the decisions will be made. Be directive, not dogmatic. The intent of data integration is not to abandon or replace surveys and other custom solutions at all costs; this is a major misunderstanding about the curation and insight generation process. There are some questions that can only be answered by a direct, targeted approach. When you know the information you already have from behavioral sources, you can look to fill in the most important blanks with survey insights. This will allow you to save the respondent’s time and energy for the issues where their input is indispensable. Saying that you need and want only secondary data is more dogmatic than anything; you need to follow where the insight and the decision lead. The appropriate proxy could be both primary and secondary sources. The point is to respond to your goals with clarity and as few preconceptions as possible. Be additive, not duplicative. In assembling your data stories and libraries, look for data sources that complement rather than overlap. Having two different metrics for the same market dynamic is confusing, not constructive. It may take some extra time to find the right yin to your existing data’s yang, but good curation requires looking beyond the options handed to you. If you are not willing to push to be better, your insights and decisions will suffer. Embrace transparency. Do not accept ambiguity in your data sources, and avoid it in your own output. Understand the quality and limitations

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of your data sources before you bring them together, and look for better data if you are not satisfied. By the same token, be very clear with your audiences about how you have combined and edited information, so they know what they are getting and how they can and cannot use it. Black box approaches ultimately benefit no one. Understand your audiences. To make your curation efforts pay dividends, you need to be sure that the results are served in ways that will speak to their intended audiences. We need to bring this sensibility to every curatorial engagement for a brand or client. At the most fundamental level, know how many types of users want to digest and use the information you are

providing. Understand the decisions they need to make, and put the right data front and center in your dashboard or deck. Think about nuances like pairings; putting one insight next to another may bring out new implications in both, just as hanging two paintings side by side reveals unseen elements in each. Be data-agnostic. Nimbleness and flexibility are essential qualities of the data curator. If the engagementâ&#x20AC;&#x2122;s goals require that we incorporate third-party data, publicly available sources and the clientâ&#x20AC;&#x2122;s loyalty card records, do not resist the obvious. Predetermined ideas about where proper insights come from and who is profiting can distract you from your top priority: meeting the clientâ&#x20AC;&#x2122;s stated needs.

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The act of curation is about communication. In the end, curation is profoundly active. We are not just moving puzzle pieces around, we are creating a work that is part science, part art and largely shaped by the curator. It is the job of the business to give the curator enough information to do his or her job right. The curator, in turn, should fearlessly pursue the goals of his or her clients, always on the hunt for better data, deeper insights and clearer connections between statistics and decisions. m David Krajicek is a member of the GfK management board and chief commercial officer of GfK Consumer Experiences. April/May 2017 | marketing news

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Lakota elder Rita Long Visitor Holy Dance, 93, and her son Nathaniel Blindman traveled 12 hours from the Pine Ridge Reservation in South Dakota to the Oceti Sakowin camp. Rita offered her support and encouragement to the camp's organizers and elders on behalf of all Lakota people.

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The Revolution Was

#Live The #NoDAPL movement may not have successfully stopped a pipeline, but it brought Native American voices and issues to the top of social media feeds

by Sarah Steimer Photos by Laura Fong

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The

camera is focused on 13-year-old Tokata Iron Eyes. The sun is bouncing off her cheek as her eyes beam and she tells the audience, “I feel like I got my future back.” As if on cue, she begins to cry. There were, of course, no cues from a director—no producer who plucked this young Native American from a pile of headshots. It’s unscripted and it aired in real time, with almost 2 million views on the Facebook Live video to date. The clip is of Iron Eyes celebrating a sinceoverturned decision by the Army Corps of Engineers not to grant an easement to allow construction of the 1,172-mile-long Dakota Access Pipeline, designed to carry crude oil from North Dakota to Illinois. The video captures the youth of the anti-pipeline movement, a group that helped propel its messaging across the U.S. and beyond using some of the simplest (and cheapest) of marketing tools: social media. The movement—known via hashtags that include #NoDAPL, #WaterIsLife and #StandWithStandingRock—did something still relatively new in storytelling. Not only did it tell its story in real time, but it opened that voice up to anyone who would listen. Brands with some of the greatest

expertise, manpower and editing skills still haven’t quite mastered the art of live storytelling, and they certainly wouldn’t give that power to just any average web user, free to attach the movement’s name to whatever is produced. The NoDAPL movement chose to open this story to gain traction and awareness, placing a spotlight on an issue that wasn’t getting much mainstream media traction. It used promotional tools familiar to many marketers, but the voices that rose weren’t from polished brands—they were from people and organizations rarely projected through a corporate megaphone. The pipeline has yet to be halted as of this article’s publication, which may suggest the movement wasn’t a complete success. But is it a complete loss if it led to Native Americans gaining a larger audience within the national conversation? In this case, a battle may have been lost, but a considerable following was won—an outcome marketers would consider a win in the long game.

INTRODUCING A MOVEMENT AND REINTRODUCING A PEOPLE

The general consensus was that the movement against the Dakota Access Pipeline began with young indigenous people. Specifically, many point to the Oceti Sakowin Youth, or the Standing Rock Youth, and a number of relays they ran to garner awareness and support for their stance against the pipeline. Bobbi Jean Three Legs, a young Lakota woman from the Standing Rock Sioux Reservation, organized the runs, which grew in size and distance from March 2016. The second run was a 500-mile relay from the Sacred Stone Camp, ground zero for the movement, to Omaha to deliver a letter to the Army Corps of Engineers. The Indigenous Environmental Network set up a social media campaign around the run, and the Standing Rock Youth designed a Change.org petition for their efforts. The run then expanded to include Washington, D.C., and New York. Juliana Britto Schwartz, a campaigner at Change.org who supported the Standing Rock Youth petition, says the group’s storytelling ability, particularly on social media, and use of Change.org’s update tools were huge contributors to gaining more than 500,000 supporting signatures. The real-time documentation that so many young people do naturally throughout the day only deepened the story for those following. Schwartz recalls an instance on the relay to Washington, D.C, when the runners learned one of the final permits for the pipeline had been granted by the Army Corps. The group turned to Facebook Live to record their reaction.

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The Kalpulli Yaocenoxtli Aztec Nation arrived at the Oceti Sakowin camp in early October 2016. More than 200 indigenous tribes offered their support and solidarity with the water protectors.

“It was so powerful,” Schwartz says. “I was tearing up just watching them feel like they had run all this way and no one was listening. And then they made the decision as a group to keep going.” Schwartz says there were two unique parts of the Standing Rock Youth’s campaign: This was not just a youth effort, but an organized youth effort that also had the backing of elders. She says this campaign was also particularly compelling because it brought the Native American voice to the forefront of a massive, mainstream campaign, something she says there isn’t a lot of at Change.org or elsewhere. They amplified their message through authenticity. “They didn’t manufacture a story to pull people in. The campaign just escalated in a way that you couldn’t put your phone down,” Schwartz says. “You wanted to see what was happening next.” Some of those who took note included celebrities. Actress Shailene Woodley was among those who picked up on the story, particularly via the relays, and boosted the messages through her own social media channels. This was no small victory in getting the opposition’s word out, as Woodley has more than 1.9 million followers on Instagram and 1.22 million followers on Twitter. While Woodley and other celebrities, including actors Leonardo DiCaprio and Mark Ruffalo, showed

their support on social media and in interviews, the indigenous people being directly affected saw their own voices rise to the top. Simon Moya-Smith, a journalist and activist, emphasizes that Native Americans want to tell their own story, and social media provided the platform to do so. “This is the first time in history that the Native American voice, the authentic, bona fide Native American voice has been ubiquitous,” Moya-Smith says. “You have people utilizing their phones, their Facebook, Twitter, Instagram, Snapchat, whatever they can to get the narrative out.” According to Moya-Smith, a large part of getting the narrative out is reminding people that Native Americans do, in fact, still exist. In speaking with an online audience, indigenous people aren’t only trying to battle the pipeline, but they’re also tasked with educating their readers or viewers of their existence. It’s a basic marketing conundrum: How do you convince people to convert or transact if they don’t even know you exist? This reeducation is happening online, and MoyaSmith says the narrative of evicting Native Americans hasn’t changed much, but the way this story is being told has. It’s being told in real time, and sometimes it’s a brutal story to watch.

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Donations piled next to the common eating area and main prayer circle at the Oceti Sakowin camp. In early October, night temperatures were as low as 30 degrees.

“When you see these images and videos coming through of unarmed water protectors being assaulted, it starts to wake people up and it bridges the space,” Moya-Smith says. “The idea of reservations was to remove Native Americans out of sight, out of mind, to geographically isolate us. Through social media, that geographic isolation isn’t there anymore.” When it comes to the Dakota Access Pipeline in particular, he says, social media pushed Native American voices to the front. Both young Native Americans and the elders have embraced social media for responding in real time to the national conversation, which can often include correcting misunderstood or mis-told stories that have circulated for centuries. “This isn’t revisionist history, it’s history,” Moya-Smith says. “We’re telling you what’s been canceled out of the conversation, and what has been canceled out has been our voice. But not with social media. With social media, we get to speak loudly and people are listening.”

MESSAGING AND UNIFICATION

Messaging has remained relatively consistent among the various stakeholders, be they individuals or organizations. Anything that includes #NoDAPL or similar hashtags could be considered branded content for the movement, and this pseudo trademark has spread like wildfire over the internet. A “Twitter Listening Report” provided by marketing and communications agency Media Cause, whose clients include nonprofits and educators, shows #NoDAPL was used on Twitter an average of 48,517 times per day between Sept. 1 and Nov. 30, 2016, for a total volume of 4.41 million. Joining the conversation became as simple as searching for and using the hashtag over any social media platform. Amplifying the message was as easy as a retweet. Taylor Johnston, account director at Media Cause, was involved in creating social media content about the Dakota Access pipeline on behalf of her agency’s client, the National Resources Defense Council. She says the

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”We’re telling you what’s been canceled out of the conversation ... our voice. With social media, we get to speak loudly and people are listening.”

NRDC’s conversation about the pipeline, to which they are opposed, would most often include the #NoDAPL and #WaterIsLife hashtags. They also frequently retweeted or reposted other accounts’ posts about the pipeline. The NRDC and other organizations made sure to tag and check in to Standing Rock as part of their social media messaging as well. Johnston says this only strengthened the unification against the pipeline, suggesting the protest was far larger than just those on the ground and included a massive online community. She credits the Indigenous Environmental Network for helping to unify the messaging used by so many opposed to the pipeline. IEN acts as an umbrella organization that builds alliances among indigenous communities, environmental organizations and other groups in an effort to organize campaigns, direct actions and create public awareness. “They (IEN) were the ones that were really creating these coalition groups, these coalition messaging points, and distributing it out,” Johnston says. IEN figured out who was involved, who was protesting and unified the audience, she says. They pushed out different pieces of information, and other organizations put IEN at the forefront, letting them push out messaging and direct the dialog. “Having a coalition with cohesive messaging helped to strengthen that messaging, get out the truth and fight through all the cloudiness … of all the other dialog,” Johnston says. The way this unification works on social media is relatively simple. Johnston says the NRDC would amplify the messages posted by others—for example, reposting items from the Standing Rock Sioux social media accounts. There was a day of action (#NoDAPLDayOfAction) on Nov. 15, 2016, that many organizations opposed to the pipeline took part in, with their varied social media accounts working to get petitions signed and create buzz. Jade Begay, a producer and communications coordinator for IEN, calls social media use crucial for grassroots movements. Begay says one example of its success was in bringing U.S. military veterans to defend Standing Rock water protectors. “I conducted interviews with veterans who were there [at Standing Rock], asking them how they heard this call and what it felt like to get this call of duty, so to speak,” Begay says. “A lot of the response was, ‘Well, I first heard of Standing Rock on social media,’ or, ‘I first heard of the movement from social media and then I continued to follow, I continued to stay engaged via Facebook and when the call was made for veterans to come, that’s when I knew it was the right time for me to join.’ Everybody I interviewed

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or who our team interviewed said that they heard of the movement or learned about it via social media.” Begay says a large part of IEN’s work prior to rallies or marches is focused on unifying messaging and visuals: What will the banners say? What artwork will be present? If IEN is holding its own action, it will bring its delegates together from across the nation and huddle on the messaging. “We’re learning more and more that we need to be very clear in our messaging,” Begay says. “We can’t just say, for instance, ‘protect indigenous rights.’ To indigenous people, we know what that means. We know what our goal is. But when non-native people see that message … we don’t know if people understand what indigenous rights are really because of hundreds of years of erasure and not respecting treaties.” She says the use of phrasing related to treaties, such as “honor the treaties,” is often debated because the audience may not know that any treaties even existed between the U.S. government and Native Americans. Another key point of phrasing, she says, relates to how those opposed to the pipeline are referenced. She says her organization has worked to get journalists to use the phrase “water protectors,” rather than protestors. Not because these people aren’t protesting, but because of the negative connotation that can be attached to the word “protesters.” With the messaging defined and the audience growing, the calls to action came rolling in. Chief among them has been the call to defund the pipeline, often referenced via the #DefundDAPL hashtag. The dedicated website for defunding explains how to do so, with individual, organizational and governmental steps. The site describes how to remove money from banks involved in a key loan for the pipeline, but also urges those who took specific action to post about it on their social media accounts. The site’s tracker claims $74.91 million has been divested from the Dakota Access Pipeline in personal funds and $4.07 billion divested in city funds. The #DefundDAPL hashtag is seen on almost 6,000 public posts on Instagram, with users showing their divestment letters and envelopes or standing in front of their former banks. The Standing Rock Sioux Tribe, Native Organizers Alliance and Indigenous Environmental Network also called for the organization of a camp and march on Washington, D.C. Much like the Women’s March before it, the call went out via social media: Invitations came through Facebook, and the hashtag #NativeNationsRise grew in use as attendees posted from the event. The number of RSVPs on Facebook came to about 2,000.

ANCIENT CULTURE, MODERN TECHNOLOGY

The impact and necessity of social media was clear from the start of the movement. While the land at Standing Rock is considered sacred, some modern updates were needed. Specifically, the movement required an internet connection to broadcast the stories in an area where cell service was notoriously spotty. There was even a ridge nearby that was nicknamed Facebook Hill, where people would try to get cell service. Begay says IEN and some other groups were able to get Wi-Fi connectivity in some of the tents in the Standing Rock camp, but there still weren’t ideal internet conditions. Live video from some of the final days of the camp in February was fairly poor, but vital, still, in telling the story. “Having this ability to go live gives us a really useful tool to bring attention to what is happening in the moment,” Begay says. “Those live feeds were such a powerful way to show what was happening, and not necessarily from a biased place because you’re not editing. You’re showing exactly what is happening in the moment.” Marketers speak constantly about the use of live video and social media to tell stories, and young people in particular have taken to these formats for their everyday lives. It can, however, feel like a clash of cultures to digitally document such an old, indigenous population. Moya-Smith says there are some situations and ceremonies where people are not allowed to use a cell phone or take photos. But where Native American elders request sacred ceremonies remain undocumented, they also understand the importance of social media to connect the community. “Native Americans are the smallest racial minority in their own ancestral land, only 5.2 million people,” Moya-Smith says. “That’s a very small community of people, but social media brings our people together and our elders want us to come together. They want to make sure that somebody who wasn’t born on the reservation can go back to the reservation and learn the language, learn ceremony, etc. That’s where social media helps you become that community, but it can’t be in certain situations like [a] ceremony. Turn it off.” There have been some instances where modern, digital light has illuminated certain Native American practices for the rest of the world. For example, a member of Standing Rock Rising posted a photo on Facebook of a Sacred Fire, by request of the water protectors, prior to the final prayer walk and exit from the campgrounds on Feb. 22. The post read, “For those of you not aware, the Sacred Fire has always been off limits for media, as it contains the spirits. I was

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A holy woman of the Kalpulli Yaocenoxtli Nation offers prayers for the water protectors at the Oceti Sakowin camp in October 2016. Each nation performed a welcome dance in their full regalia from the campâ&#x20AC;&#x2122;s entrance to the main prayer circle.

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BRANDING THE MOVEMENT The media focused its attention on the pink “pussy hats” worn by the attendees of the Women’s March, but there was another piece of clothing that stood out: a turquoise scarf. On it was an illustration of native women performing the “Shoshone Warbonnet Dance.” The scarf was worn by the Indigenous Women Rising group that attended the march, and they urged other Native American women to wear the scarf as a sign of solidarity. The scarf was created by Los Angeles-based designer Bethany Yellowtail, a member of the Northern Cheyenne Tribe. “That image and the scarf, that clothing item, became a symbol for us to know where our allies are, to know who’s raising their voice,” Yellowtail says. “It’s been really incredible to see that clothing can be a way to get people out and get people active. It’s a very obvious issue to know who’s standing with you.” This wasn’t the first time Yellowtail used her fashion design skills for a movement. She created T-shirt imagery for Sen. Bernie Sanders’ campaign in early 2016 and for the Standing Rock water protectors. Proceeds from the “Protector” line went to the Standing Rock Sioux’s legal fund. At the end of February, Yellowtail partnered with Sarah Eagle Heart, CEO of Native Americans in Philanthropy (NAP), to launch a social impact clothing brand called SACREDx. The brand features shirts that include words such as “Resistance” and “Strong Hearts to the Front.” The goal, according to a press release, is “to dress the resistance, and bring indigenous voices back to the forefront.” Ten percent of the proceeds will be donated to NAP. Yellowtail says non-native companies try to capitalize on native movements, including the Standing Rock movement, and there’s no way to know where proceeds from these products go. “This (SACREDx) is a native-owned brand, it’s owned by myself and Sarah Eagle Heart. We come from reservation communities and we understand our people,” Yellowtail says. “By streamlining a brand and streamlining messaging, we know it’s been taken care of in a way it should be. Many times, when you have these big movements happening, people try to take our perspective from us.” Yellowtail says she hopes the clothing line will be worn as people shop, bank and go about their daily lives. “We know that the front lines are everywhere now,” she says. “That’s the beauty of it, right? These scarves or the T-shirts or the imagery that is coming from SACREDx is helping to keep the momentum of the movement going beyond just the gatherings. It’s constantly advocating for people. It’s a great visual to see out there and know indigenous people are everywhere.”

honored to be asked to do this.” A Facebook Live video of this final prayer and fire also exists. Another strong tech presence has been from drone footage. Myron Dewey, a producer at Digital Smoke Signals, used a drone to document Standing Rock and surrounding camps, posting the video regularly to Facebook. Some of the footage went up raw, while some went into edited video used on other Facebook pages or websites. Documenting the movement for the web may have enabled a certain amount of armchair activism—the idea of publicly supporting something without having to physically leave your space to advocate and get involved. “Power exists through engagement, and more often than not that engagement is due to the smartphone,” says Scott Goodson, a movement marketing expert and author of Uprising: How to Build a Brand—and Change the World—by Sparking Cultural Movements. “What the thumb wants, the thumb gets.” Goodson recalls the Facebook check-in phenomenon from early November 2016. More than 1 million people “checked in” on Facebook to the Standing Rock Indian Reservation page, a move largely sparked by a rumor that suggested local police were using Facebook check-ins to track activists protesting the pipeline. There was never any proof of this, with the Morton County Sheriff ’s Department posting to Facebook that it did not follow check-ins. Whether these check-ins actually thwarted any police actions really isn’t the point, Goodson says. It was about a show of support. “The idea of standing for righting a wrong was more important in creating and spreading the movement than the details of what the protesters were fighting for,” Goodson says. “That’s not to say that what the protesters fought for was insignificant. On the contrary, movements spread faster and wider when they are grounded in something important but are simplified into something that people can stand for or stand against.” Think of it this way: Facebook likes on a brand page or video are not as valuable as actual purchases. But they absolutely add some form of brand value. To understand just how powerful these online conversations, photos and videos on social media are, consider a warrant filed by the Whatcom County Sheriff ’s Department in Washington. The department is seeking information from the Facebook page of a Bellingham, Washington, group fighting the Dakota Access Pipeline. The warrant would cover not only protestors’ information, but that of those who interacted with the page as well. The American Civil Liberties Union has filed a motion to throw this warrant out.

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"movements spread faster and wider when they are grounded in something important but are simplified into something that people can stand for or stand against.”

MEASURING SUCCESS

To determine how successful this movement has been depends on what you choose to measure. It could be ruled a failure because the pipeline has not been halted, and the water protectors have left Standing Rock. On the other hand, it may be deemed a success because awareness of not only the pipeline increased, but also of Native Americans’ continued fight for indigenous rights. A Quinnipiac University national poll released in February found 51% of respondents oppose the restarting of the Keystone XL and Dakota Access pipelines, compared with 38% in favor of restarting. Similarly, a Pew Research Center poll from February found 48% of respondents oppose building the Dakota Access Pipeline, versus 43% in favor. The Quinnipiac poll broke its findings down by age as well, with 66% of those ages 18 to 34 and 54% of those 35 to 49 in opposition to the pipelines. These figures suggest the movement’s massive social media presence may have missed a large chunk of the American audience—specifically older populations, considering there was far more web coverage of the issue than traditional media coverage. Another Pew study from 2016 found 50% of those ages 18 to 34 and 49% of those ages 35 to 49 often get their news online; compared with 29% of those ages 50 to 64 and 20% of those 65 and older. The movement’s open web presence also ran the risk of negative social media posts that were tagged #NoDAPL or #DAPL. Those leading the movement, however, have done their best to correct what goes out when they can. For example, the Standing Rock Sioux Tribe posted a statement in February referencing false reports, saying, “We cannot let media and social media divide us. We have always been transparent in our messages and actions; it is unfortunate when certain media take messages out of context. We must

remain focused on our goals. The movement is bigger than just the tribe. It is bigger than the Chairman, or any individual. We should all be working together to protect the tenets of the movement.” With so many different organizations and individuals now involved, there has been some confusion over who exactly to listen to or follow. Those trying to donate money to the effort may also face some chaotic responses online. For instance, a search for “NoDAPL” on the crowdsourcing website GoFundMe produces 710 results. It’s unclear if there’s a way to determine which pages are legitimate. Despite all of the noise, many contend that the movement has become much larger than protesting the pipeline: It has brought the Native American voice toward the front of the national conversation, at least online. Arguably one of the most successful strategies of the movement was incorporating an environmental discourse. Many Americans may not know or understand treaties or sacred burial grounds, but most have heard about climate change and pollution. In fact, a Pew Research poll found 59% of U.S. adults believe stricter environmental laws and regulations are worth the cost, compared with 34% who say such regulations cost too many jobs and hurt the economy. For the NoDAPL movement, tapping into the potential environmental effects of the pipeline meant tapping into Americans’ existing concerns and anxieties. As Begay explains, using the term water protector, versus protester, also tapped into a more environmental message. “We were protecting water and protecting ecosystems, not just for our communities but for the 7 million people downstream and the global community,” Begay says. Goodson says this environmental angle may have been what helped give the movement momentum. Native issues, he says, can come to the front and center when the movement taps into what people already care about, issues that are relevant to others’ lives. “Blame it on global economic pressures, general restlessness, populism or the hyper-connectivity that enables people to instantly organize around causes and hot topics,” Goodson says. “It’s probably some combination of all of these factors, but the net result is that we are now dealing with a populace that is more socially engaged, more aware of what’s going on in the world and hungrier to get involved and be heard on various issues. “If I was consulting for native leaders, I would say listen to what people are crying out for. ... Find out what they’re passionate about, what they’re talking to each other about. If you listen closely, you may detect the rumble of an idea on the rise—and it might be one you can build a movement around.” m

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Social Media, Smartphones and Other Drugs

Where is the ethical line in marketing between hooking a customer and getting them hooked?

By Hal Conick

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Media is an open door to the public mind, Edward Bernays wrote in his landmark 1947 essay “The E n gi n e eri n g of Con se nt.” “Any one of us through these media may influence the attitudes and actions of our fellow citizens,” he wrote. “The United States has become a small room in which a single whisper is magnified thousands of times.” Seventy years later, the door to the public mind is wide open. The thousands of whispers have been multiplied by billions into a deafening roar of smartphones and social media. Consumers can stay in touch with the people and brands they love, meeting new ones along the way. In turn, marketers are now privy to consumer data they dared not dream could exist even 15 years ago—what consumers’ preferences are, how much they weigh, what sexual acts they prefer and the contents of their contact list. Marketers can reach consumers in their home, at work, in the car and anywhere they happen to take their devices— which, for many, is everywhere. As

technology has made communication easy and life convenient, it has placed a two-by-five-inch glowing screen at the center of both. U.S. teenagers spend nine hours per day using media devices for enjoyment, Common Sense Media reports, which adds up to more than 136 days of the year—not even including media time spent on homework or school. Globally, the average adult spends two hours per day on social media networks, Social Media Week reports, up from 15 minutes per day in 2012. Even if this latter number remained static, that would mean a lifetime average of five years and four months on social media—a number surely higher in the U.S., where 77% of people own a smartphone and 69% use some form of social media. In this ecosystem, demand for a new kind of rehabilitation has emerged. Facilities, such as

reSTART Life in Washington state and Paradigm Malibu in California, have popped up across the country to treat social media and technology addiction in children and adults. Addictive qualities aside, social media could not thrive if it wasn’t so uniquely—for lack of a better word—social. Humans are social animals who ache for connection with others. Mauricio Delgado, associate professor of psychology at Rutgers University, explained to Marketing News in 2014 that social media activity—likes, retweets, comments—activates the brain’s reward center in the same way as a hug, smile or compliment. Social media interactions are positive reinforcement, he says, bringing favorable effects and drawing users back again and again. Ashlee Humphreys, associate professor at Northwestern University’s Medill School of Journalism and

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H e a vy I n v e s t m e n t s

author of Social Media: Enduring Principles, says users are hooked on this social feedback, longing for the dopamine high it creates. “We are always looking for how the social environment is responding to what we do,” Humphreys says. “Social media— let’s just say even more concretely the smartphone you carry around with you—allows you to get that social feedback, interact socially and put out social feedback 24/7.” Humphreys cites an argument from Barry Wellman, sociologist and director of the NetLab Network, who says humans are now “networked individuals.” This means people actively seek online social capital, but physical group settings—such as bowling leagues—have become less common. An example of network individualism at work is someone posting for emotional support on Facebook when a loved one is sick; those friends who respond may not be lifelong friends, but they may give an on-demand bandage for an emotional wound. Social media seems to walk the line between a way to socialize, an annoying habit and an addiction. Marketers may play an ethical role in ensuring consumers don’t cross the line from habit to addiction. To find the ethical line, we must first look at how social media can adversely affect people.

Th e Dark Si de It would be fallacious to say social media or smartphones are a net negative for society, as many studies have shown the power and positivity of human connection on these platforms. However, as Aristotle said in The Nicomachean Ethics: “Virtue lies in our power, and similarly so does vice.”

Facebook, the world’s largest social platform, has approximately 2 billion users worldwide and is accessed daily by 76% of its American user base, according to Pew Research Center. Marketers, who spent $11.7 billion on Facebook and other social media networks in 2016, are expected to spend $13.5 billion in 2017, $15.4 billion in 2018 and $17.3 billion in 2019, according to Forrester Research. Marketers are also investing a lot of time at work in social media, according to Social Media Examiner. While 58% are spending between one and 10 hours on social media, 19% are spending in excess of 20 hours a week on social—5% of which say they spend more than 40 hours per week marketing to customers on social media.

The vice of social media can be shown in recent studies, including: • German researchers from Humboldt University and Darmstadt’s Technical University report one-in-three people felt more dissatisfied with their lives after browsing Facebook— particularly those who browse without contributing. • A study published in Psychological Science reports subjects had the highest “self-control failure rate” with social media—higher than sports, spending and sex. Wilhelm Hofmann, lead author of the study and an assistant professor of behavioral science at University of Chicago Booth School of Business, told The Guardian that human desires for social media may be harder to resist “because it feels like it does not ‘cost much’ to engage in these activities, even though one wants to resist.” • A study in the journal Psychological Reports: Disability & Trauma found technology addictions share features with substance and gambling addiction. Social media addictions may result in “academic failure, sleep deprivation, social isolation, health issues and many other impairments for adolescents and young adults; they also result in

reduced work performance and marital discord and separation for adults.” Researchers found that these addictions activate the amygdala-striatal brain system— which creates the drive for impulsive behavior—but do not seem to activate the prefrontal cortex, the part of the brain that controls inhibition. Thus, there are shared traits between the digital world and drugs, but it may be unfair to say a social network like Facebook or Twitter is tantamount to a drug like cocaine or alcohol, as posited by recent news headlines covering this study. James Roberts, a professor of marketing at Baylor University who has spent much of his career looking at the “dark side” of consumer behavior, says the most concrete example of technology’s addictive qualities is the willingness of many to risk their lives by using a device while driving. The U.S. Centers for Disease Control and Prevention reports more than eight people are killed and 1,161 are injured each day from an accident involving a driver distracted by screens. For scale, this is just less than one-third of the number of people killed or injured from accidents involving alcohol. Aside from physical safety, Roberts says people risk their own

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relationships by “phubbing”—phone snubbing—which entails paying attention to a device in the middle of an interaction with a romantic partner. In one of Roberts’ studies, 70% of people say phubbing hurts their ability to interact with their partner. This seems to follow people into the workplace, as Roberts says a study currently underway by his team is finding “phubbing” can also harm employer-employee relationships and job status. “When you perceive your partner to be spending more time and

paying more attention to their phone, that undermines your relationship satisfaction, so you are less happy,” Roberts says. “And if you are less happy, you are more likely to report higher levels of depression, stress and anxiety.” The internet is set up to be addictive, Roberts says. Companies want consumers to be clicking from page to page, to be interrupted and distracted. That’s what keeps the proverbial cash register ringing. “The internet has been created by people much smarter than me with the sole

B ra n d s u s e experiences to implant themselves in the consumer’s m i n d ; u s i n g a n a p p, p l ay i n g a g a m e , wat c h i n g a v i d e o o r r e a d i n g c o n t e n t.

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purpose of keeping you moving and keeping you off balance,” he says. “You’re always being interrupted. You’re clicking and you’re making more money for the advertisers.” At the center of the social-digital movement are brands profiting from the internet’s addictive structure. Products by brands such as Apple, Facebook, Microsoft, Twitter and Google are almost irresistibly entertaining on their own. Then, factor in brand-sponsored commentary, games, videos, posts, contests, images, virtual-

reality simulations, notifications and messages—all optimized by personalized consumer data— and you have something far more transfixing than any TV show or movie. But does this level of consumer absorption make the product addictive or simply a habit? That may depend on how one defines the terms “addiction” and “habit.” Nir Eyal, an entrepreneur and author of Hooked: How to Build Habit-Forming Products, says a habit—which can be good or bad— is an action performed with little or no conscious thought. Addiction, on the other hand, is always bad and defined by Eyal as a persistent and compulsive dependency that actively harms the user. Similarly, Roberts sees behavioral addiction as any action a person continues to perform despite negative consequences. Where they differ shows their biggest disagreement: Eyal believes only a small percentage—2% to 5%— of the population is hooked, while Roberts believes the number is anywhere between 50% and 66% of U.S. citizens. Researchers from the aforementioned study in Disability & Trauma believe anywhere from 0.7% to 11% of the population is addicted to technology. A matter for marketers, then, is what role brands are playing in the increased consumption of social media. Are brands simply practicing good marketing or are they taking advantage of their advanced knowledge of what makes the average human brain tick? Could the virtue of good marketing—which as Aristotle noted lies in power—turn into a vice?

Th e Sh ift from M ereexposure to Experi e ntial Marketi n g Since the start of the 21st century, there’s been an important psychological shift in marketing. The mere-exposure effect—defined by PsychCentral as a preference for people or things simply because

Busy Fi n gers The average U.S. consumer checks their phone 150 times per day, according to Kleiner Perkins Caufield & Byers’ annual "Internet Trends" report. Stretching the number a bit further, research company Dscout reports the average person touches, taps, clicks or swipes their phone 2,617 times per day.

they’re familiar—dominated advertising and marketing in the 20th century. The theory works like this: The more a brand exposes itself to consumers on TV, in magazines, in newspapers or on billboards, the more consumers grow familiar with the brand. Exposure and familiarity mean increased sales. However, many modern companies don’t rely on the mereexposure effect anymore, according to Eyal. Consider how rarely you see billboards or ads for Snapchat or Facebook. Instead, brands use experiences to implant themselves in the consumer’s mind; using an app, playing a game, watching a video or reading content. “The products themselves change consumer behavior and tastes; it’s through forming habits with the product,” Eyal says. “The product experience itself is what makes people use them more. That’s different. That’s news. That’s something only this century that we’ve seen.” The best products don’t win, Eyal says, but products that have monopoly of the mind do. Take the phrase “search engine,” for example: Does anyone’s mind immediately think Yahoo or Bing? Without much conscious thought—perhaps as

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TH E H OOK M ODE L TRI GGER

ACTI ON

EXTERNAL INTERNAL

I NV E STM E NT simple as the unconscious stroke of the letter “G” on the keyboard— Google likely flashes to mind. How do brands win monopoly of the mind? Eyal breaks down the four basic steps of the hook model: a trigger, an action, a reward and an investment. Brands identify the consumer’s initial trigger and the trigger’s accompanying emotions, in the process allowing consumers to easily collect rewards. The hook for rewards becomes more enticing on a variable schedule instead of a fixed schedule; Eyal says this is the same psychology at work as pulling the handle of a slot machine. The best example of this may be the social media newsfeed, which users continuously scroll through and pull down to refresh. What pulls the hook model together is investment, the

VARIABLE REWARD final step of experiential marketing, which Eyal says can only be done by interactive products. “What’s happening is this tectonic shift where products are being made not only by the company but by the user,” Eyal says. “When customers put something in a product—like data or content and they increase followers or reputation—they’re literally crafting the product with the company. So if [another user] were to log into my Facebook account or Pinterest account, it would be really boring [for them] because it’s been tailored to me based on the data I’ve given the company. That’s something that a box of Cheerios can’t do yet. These companies are literally making the program with you based on your data and that’s a really big deal. That’s a sea change.”

This sea change has not come by mistake, as companies now know more about the consumer than ever before. Michael Quinn, author of Ethics for the Information Age and dean of the College of Science and Engineering at Seattle University, says data collection and privacy is the biggest issue in digital ethics today. “Sophisticated algorithms now allow governments and private entities to construct sophisticated profiles of individuals,” Quinn says. These individual profiles are, in turn, used to appeal and sell the experience to consumers by social media platforms, third-party aggregators and brands. Cal Newport, associate professor of computer science at Georgetown University and author of Deep Work, said in a 2016 TED Talk that companies now use “attention engineers,” a principle borrowed from Las Vegas casinos, to make products as addictive as possible. “That is the desired use case of these products—you use it in an addictive fashion because that maximizes the profit that can be extracted from your attention and data.” Tristan Harris, a former Google design ethicist and founder of Time Well Spent—described by its website as “a movement to align technology with our humanity”— says product designers “play your psychological vulnerabilities (consciously and unconsciously) against you in the race to grab your attention.” To maximize a product’s addictive nature, Harris writes that tech designers link a user’s action— refreshing their newsfeed—with a variable reward, such as a match, notification or prize. However, not every brand sets out to be a peddler of an addictive product. Harris is careful to argue that most of these “slot machines” emerge

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Are You Addi cte d? There are six signs of behavioral addiction—which can include technology, sex or gambling—according to Roberts. These signs are: • Salience: A behavior becomes deeply ingrained within a routine. Smartphones lie next to the bed, social media is swiped daily. • Euphoria: Users get a feeling of giddiness or anticipation with each notification, comment or buzz. Roberts’ website says people may find themselves often picking up their smartphone when bored or taking calls and texts—or perhaps pretending—to avoid social situations. • Tolerance: People feel an increasing need to have a bigger dose, i.e. more time than one may care to spend on Facebook or Twitter. • Withdrawal symptoms: Stress, anxiety, sadness or panic are the touchstones of separation from a behavioral addiction; technology is no exception. • Conflict: Does smartphone use cause arguments with friends or lovers? Are you texting and driving? • Relapse: Have you ever unsuccessfully attempted to stop or cut back on use of technology? Visit Roberts’ website (http://smartphoneloveaffair.com/quiz/) for the full quiz and see: Are you addicted to smartphones or social media?

by the accident of good design. Even so, he says companies like Apple and Google now have an ethical responsibility to reduce intermittent variable rewards in exchange for a less addictive reward system through better, more humane design. “For example, they could empower people to set predictable times during the day or week for when they want to check ‘slot machine’ apps, and correspondingly adjust when new messages are delivered to align with those times,” he writes.

Th e Differe n ce an d th e Li n e For Eyal, the ethical line between habit and addiction is rather dark. He believes marketers must be allowed to make good products that hook consumers, especially with innovative technology. “I’m not a Luddite. I love these technologies,” he says. “They make the world a much better place. But you can’t separate the tenets that make the product good with the tenets that make it potentially addictive.” People will get addicted to anything sufficiently good. You can’t help it, he says.

This doesn’t mean marketers, programmers and brands don’t have an ethical responsibility to the consumer, he says; they do. Eyal says he won’t consult with gambling websites, porn websites or alcohol companies because he doesn’t believe they responsibly deal with addiction. Brands in the digital realm know who the addicts are because of the data they collect. “Facebook, Zynga and all social games know how much time [consumers] are spending online,” Eyal says. “If they wanted to … reach out and ask them, ‘Hey, can we help you dial it back?’ they could. And if [consumers] say, ‘No,’ frankly there’s not much we can do. But if they say, ‘Yes,’ if they say, ‘You know what, I really need some help here,’ we can help. … Many unethical companies don’t respect that. But that’s something an ethical company has a responsibility to do.” So ethical responsibility does somewhat fall on brands, but making an addictive product or creating new consumer habits is the job of marketing—in a way, Roberts says. In his introduction to marketing classes, Roberts tells students that marketing

is all about behavior modification, or getting people to do what you want them to do. “I hate to put the responsibility on marketers,” Roberts says. “Marketers are just using our increased understanding of habits and addictions and the way the brain works. We’re putting that to good use to create habit-forming behavior, so I don’t see really an ethical issue. … It is a reflection that the science of marketing has just taken leaps forward with our increased understanding of how our brains work.” Roberts stops and thinks for a moment before reversing course. Perhaps there is an ethical problem, he says, one where the marketer’s knowledge of the customer is so advanced that people can be duped, trained or conditioned to do what brands tell them to do. After all, the understanding of the human brain has never been better. While it’s the marketer’s job to ensure a sticky website, platform, blog or app, is there not also an ethical responsibility to the consumer’s health? “Maybe we’re getting to that ethical gray area,” he says. “Maybe we really do need to at least be thinking about or considering that a lot of the stuff that we’re doing is creating addictions or hardwired patterns of behavior. And maybe that needs to be rethought.” Digital addiction is a multifaceted issue, ridden with caveats, complexities and questions. In the end, Roberts believes marketers must act ethically, and consumers must take responsibility for their own actions, habits and addictions. The thought brings him back to another Marketing 101 talking point: Caveat emptor. Let the buyer beware. m

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Companies are looking for help to take contr ol of their r eputations in the anythinggoes world of online reviews. But with so many efforts to manipulate r atings, will consumers still trust reviews enough to care?

By Zach Brooke

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Hwy

i s a n e x pa n d i n g c h a i n o f

fa s t- c a s ua l r e s ta u r a n t s l o c at e d l a r g e ly i n t h e

s o u t h e a s t e r n U n i t e d S tat e s . The style is 1950s diner, complete with checkered tile, hot pink countertops matched with neon tube signing and kids’ baskets served in cardboard convertibles. The chain takes its name from the 200-mile state freeway that begins at the Atlantic Ocean and winds inward through North Carolina, running past Goldsboro, home of its first location, before terminating at Durham. Founded by Kenney Moore, an out-of-work restaurant manager using money borrowed from his father-in-law, the chain originally opened as Andy’s Cheesesteaks and Cheeseburgers. It was rebranded in 2012 when it became successful enough to expand beyond North Carolina, only to find the name Andy’s already trademarked in several states. By all appearances an entirely new operation—at least as far as the Department of Commerce is concerned— Hwy 55 still keeps a large part of its heritage employed in its Mount Olive, North Carolina, headquarters. “I wasn’t too upset when the name was changed, to be honest. Growing up with a burger restaurant named after you has its pluses and minuses, for sure,” says Andy Moore, son of Kenney Moore and director of communications for Hwy 55. “My dad started the company about 25 years ago when I was 18 months old. I’m very, very proud of him. I was in the stores in my diapers early on. I came back here to work about three years ago, and it’s been really fun.” When Moore started working in Hwy 55 corporate offices, he monitored customer reviews with just a checklist and a spreadsheet. It became overwhelming. But the need to continue the research remained.

“Reviews are becoming increasingly important, to the point now where it’s one of the major things we look at when we’re trying to find really good customer feedback,” he says. “We primarily go into smaller communities and try to become the go-to burger joint, and we really rely a lot on repeat visits. One bad experience can wreck customer loyalty for a long time.” Eventually, Hwy 55 hired a third-party review management company to organize product reviews from a single dashboard. Now, Moore says the information he gets from online reviews is in some respects more valuable than customer surveys, the previous gold standard for gauging sentiment. “I think our surveys tended to skew a little too positive. The people who were doing them were real loyalists that tended to not tell us where we could actually do better. We welcome the negative feedback,” he says. The focus on product reviews has extended to hiring an employee whose job duties include reaching out to customers that report bad experiences and, “turning it into a positive.” So far, the system has resulted in the average rating for Hwy 55 locations jumping from 3.8 to 4.1 stars. Same-store sales are up as well. “It’s like the chicken and the egg. It’s tough to say if better reviews are leading toward more business, or the things that create better reviews lead to more business, but there is a link between our highestpreforming stores and having an average rating of over four stars,” Moore says. The approach Moore is taking in Mount Olive has a counterpart in Minneapolis, where Troy Janisch, the vice president of social intelligence for U.S. Bank, is overseeing a large initiative to promote brand health via active ownership of local listings and engagement with consumer reviews.

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It’s a scaled-up version of Moore’s efforts. U.S. Bank has more than 3,100 branches, compared to Hwy 55’s 131 restaurants. Beyond Facebook, Google and Yelp, its products and services are evaluated on a variety on finance industry niche sites. Added to that pile are anonymous employee reviews posted on Glassdoor, which are benchmarked against ratings given to U.S. Bank’s competitors, as well as Apple Store data for the two apps put out by the company. Janisch spends a lot of time thinking about reviews. He calls them the most valuable form of social data, in contrast to social networks like Facebook and Twitter. As he sees it, posts about brands on these spaces can be very short, making it hard for algorithms to classify them as positive or negative. Or they could be an opinion about a policy coming out of corporate headquarters, rather than service at the location around the corner. It can also be hard to know for sure if users are talking about a specific company, especially one like U.S. Bank that combines two very generic terms. On top of all that, Janisch says when users take to social media to talk about a brand, it’s often because they’ve just had a bad experience, and they’re looking to vent by bad-mouthing the brand. “We want to take that offline and have a conversation and help solve their problem,” he says. Review sites are more helpful in providing customer feedback. “The two items that social media monitoring is toughest with is relevance and sentiment. Those are two things that review data guarantees accuracy with,” Janisch says. “Not only do we know if the experience is good or bad, but we know the intensity.” Janisch goes so far as to subscribe to the concept of Net Customer Sentiment. It’s a take on the traditional Net Promoter Score, a survey metric intended to gauge loyalty by asking how likely a customer is to recommend branded items to a friend or colleague. Because review sites often reflect strong consumer emotions (on a five-point scale most responses will be a one or five; three will be the least-selected rating), they can effectively measure brand loyalty within the marketplace. “A company of any size can leverage the customer review data to both measure and benchmark sentiment,” Janisch says. “That’s the foundation of Net Promoter Score. People who have an average experience are never going to become brand advocates or critics. It does take a certain amount of emotion or intensity for someone who is not being solicited to go out of their way and decide that they want to share information about your company with others, which makes it much more valuable. A neat trick, to be sure, but the value of product reviews extends far beyond insights into customer

loyalty. That’s why both Hwy 55 and U.S. Bank turned to online review management solution ReviewTrackers to help control their influence in the realm of product review sites.

W H AT ’ S I N A R E V I E W ?

Since opening its doors in 2012, ReviewTrackers has swelled to 50 employees and launched verticals in finance, health care, insurance and retail to supplement their core services for location-based businesses. Using a proprietary technology that stacks on top of IBM’s Watson, ReviewTrackers is able to comb roughly 85 sites for all manner of testimonials and spot trends in that data. The company estimates 70% of searchers report online reviews are either the first or second factor they consider when choosing a local business, and that 53% of searches lead to an appointment or visit within 48 hours of the search. A separate report by SEO marketing agency BrightLocal says 84% of people trust online reviews as much as a personal recommendation. All these numbers hint at what ReviewTrackers believes to be reality: Online reviews have become the fountainhead of the modern customer journey. Monitor and engage them, and see your image rise in consumers’ estimation. Ignore them, and you leave your marketing to the mercy of the masses. “Sometimes in marketing, we look at the small effect. The changes we make,” Janisch says. “If you think about it in terms of the amount of influence reviews have, you can make the argument that 70% of your business is at risk if the review data that is out there isn’t supporting your company.” With Hwy 55, ReviewTrackers’ goal was simple: Provide a one-stop shop for the company to manage its reviews and suggest pathways to boost volume and rating. U.S. Bank wanted a little more. It requested help consolidating local listings (there

Online reviews have become the fountainhead of the modern c u s t o m e r j o u r n e y. M o n i t o r and engage them, and see your image rise ... Ignore them, and you leave your marketing to the mercy of the masses. April/May 2017 | marketing news

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Amazon and Yelp have been ramping up efforts to weed out fake ratings in recent years, but plenty of options remain available for those wishing to buy or sell reviews.

were more than 7,000 different pages for 3,100 actual locations) and leveraging them to enhance SEO. With ReviewTrackers, it was possible to assert an official presence on evaluation sites and eliminate the redundant pages that were bleeding traffic. Many false listings were the result of mundane mistakes like misformatted brand names and inaccurate street addresses, which needed simple clean-up. “Once you claim those profiles, they are like micro-sites for you,” says Mandy Yoh, head of communications for ReviewTrackers. “Not only were we helping that particular client with increasing their search visibility, but we helped improve star ratings, and we helped incentivize different branches of the company, so that they have really great ratings and hit that level of customer service that they want to hit as an overall, across-the-board fit.” Yoh credits the work done at ReviewTrackers with integrating total online presentation for clients, and in some cases, discovering customer experience problems. There’s American Family Insurance: “They were looking to get really organized, and have all of their local listings claimed. But they also wanted to get a line of sight about what their customers were saying about them. They had no idea.”

And Midas: “They found out that in California, their ratings were really, really, really bad and they didn’t understand why. They found out one of the biggest things they had promoted as part of their customer service mission was that everybody gets a free tire rotation with an oil change. [Individual] locations saw that customers just wanted to get out [of the shop] as quick as possible, so they weren’t doing the tire rotation. It inevitably came out in the reviews. People were pissed they didn’t get this free tire rotation. The company said, ‘Let’s start doing it [everywhere] and see if the reviews change.’ And they absolutely did.” And Giordano’s Pizzeria: “They have created an internal incentive program. Their locations have to hit a certain star rating or have to grow by a certain percentage and those locations will be rewarded.”

THE FAULT IN OUR STARS

It’s an unfortunate truth in business that where there’s success, a scam will follow. The flip side of consumer reviews becoming a powerful driver of consumer spending is the emergence of ways to game the system. The democratization of consumer reports has shown itself susceptible to fraud, bribery and intimidation.

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Efforts have and continue to be made to remove the bad actors from the equation, but itâ&#x20AC;&#x2122;s an open question as to how much consumers will take before losing faith in the accuracy of the meter. A 2011 study of Yelp ratings by Harvard professor Michael Luca found that a one-star rating increase for businesses corresponded with a 5% to 9% increase in sales. That creates a strong incentive to inflate scores. Businesses that are tempted to fudge review data need look no further than the gig economy flourishing online. A few years ago, the internet was teeming with offers to rate an item in exchange for payment. Then, enterprising middlemen got involved and created click farms that promised to blanket products with a distinguished and thoroughly reviewed track record. Sometimes there wasnâ&#x20AC;&#x2122;t even a third party. Sellers would just start cranking out fake accounts and go to town, either boosting their products or sandbagging the competition. Sites like Amazon responded with a flurry of strategic lawsuits aimed at operators it suspected of product ratings manipulation. In 2015, the company sued more than 1,000 people who posted offers on the freelance website Fiverr to write fake Amazon reviews in return for compensation. Last year, Amazon attacked

the problem from the other end by filing another suit against three sellers it suspected of buying fake reviews. Yelp has also responded to suspicious reviews with ligation. In 2013, research conducted by Harvard Business School found nearly 16% of reviews in the Boston area were fake. That same year, Yelp filed suit (and later won default judgement) against the operator of BuyYelpReviews.com. Itâ&#x20AC;&#x2122;s not just corporate skullduggery that is affecting the legitimacy of the reviewsphere. People submit evaluations based on all sorts of factors unrelated to their actual experience, including proverbial trolls or those inflamed by politics. A recent study by marketing automation firm Signpost found that one-star ratings have tripled for businesses affiliated with President Donald Trump since his election in November. Despite the crackdowns on fake reviews, the phenomenon has not disappeared from the internet. A quick search on sites like Craigslist and Fiverr turns up a handful of people advertising their willingness to review for the right price. Amazon did not respond to a request for comment. A Yelp spokesperson released a statement outlining the steps the company takes to guard against fake reviews. It reads:

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“First, we use automated recommendation software to help us determine which reviews to recommend to our users so that we are only highlighting the most useful and reliable reviews. More often than not, these reviews come from the more active members of the Yelp community. We currently recommend about 70% of the 120+ million reviews contributed. There are several reasons a review might not be recommended. The software is engineered to weed out possible fakes (several reviews generated from the same IP address), biased reviews (written by a competitor or solicited by a business owner from friends, family members or favorite customers), unhelpful rants or raves, and reviews written by users we just don’t know much about (no friends, no picture, few reviews, etc.).” Reviews have become such a public utility in the realm of commerce that governments are beginning to get involved. In 2013, regulators in New York fined 19 companies a combined $350,000 after it found them to be relying on overseas organizations to boost their ratings. And last year, Congress passed and thenPresident Barack Obama signed the Consumer Review Fairness Act, which prohibits businesses from inserting language into their terms and conditions that forbids customers from reviewing the company. Prior to the federal law, there had been several instances of businesses attempting to silence critics through fines. One prominent example involved a hotel in Hudson, New York, that demanded anyone who books the space for an event be fined $500 for every negative online review left by the customers or any of their guests. “Consumer reviews are an important part of helping other consumers make choices in the marketplace. Information about goods and services helps the buyers set the valuation and pick the best vendors,” says Eric Goldman, a law professor at Santa Clara University and co-director of the school’s High Tech Law Institute. Goldman has written an analysis of the Consumer Review Fairness Act that is scheduled for publication in a forthcoming issue of Michigan Telecommunications and Technology Law Review, but is available online now. He applauds the steps the law takes to protect consumers who speak about their experiences, but also suggests it doesn’t go far enough to protect the right to voice opinions on review sites. He says that companies still engage in heavy-handed tactics to force reviewers to rescind unwelcome critiques. One case making its way through the court system right now could, if successful, upend the entire online review concept. San Francisco personal injury attorney Dawn Hassell sued her former client, Ava Bird, for libel after deducing that she was responsible for the diatribes posted to Yelp about her practice. Hassel won

“Most of the reviewer s k n e w t h a t i f t h e y d i d n’t g i v e e v e r y t h i n g a f i v e - s t a r r e v i e w, they would probably be kicked off the platform. The sellers essentially ran the show and u s e d t h e s e p l a t f o r m s a s w ay s t o generate thousands of positive r e v i e w s r e l a t i v e l y c h e a p l y. ”

a default judgement after Bird no-showed for her court appearance, which included an order that Yelp remove the offending review. Yelp, which was not named as a defendant in the case, appealed the ruling, saying it was protected. It lost and appealed again, this time to the California Supreme Court, where the case is currently being decided. The high stakes of the case are reflected by the number of amicus briefs filed by interested parties, which read like a who’s who of Silicon Valley and include Google, Facebook, Microsoft, Twitter, Pinterest and the Wikimedia Foundation. Goldman says there are a number of ways the case could be decided, especially since the lower court’s opinion has been removed as binding precedent. But, Goldman says, if the California Supreme Court were to agree with the lower court rulings, then “none of it is good for consumers.” “There is no way that consumers are going to win under the appellate court ruling. The main reason why is for every possibly fake review that would be scrubbed, it’s likely that lots of legitimate reviews would be scrubbed as well.” Whatever the outcome, Goldman notes that the case is similar to many disputes between businesses and customers regarding review content. “When businesses contact consumers threatening them over a review, consumers fold instantly, Goldman says. “When we talk about the consumer review system, we can’t ignore the fact that it’s easy to spook consumers from writing reviews and standing behind their reviews.” He calls for the adoption of a federal anti-SLAPP (strategic lawsuit against public participation) law, which would prohibit businesses from intimidating

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consumers who leave unfavorable reviews while still protecting a company’s right to sue for defamation or information proven to be false. “We face constant threats that the review databases are being shaped by behind-the-scenes threats or enforcement efforts that never result in a public court case,” Goldman says. “[A federal anti-SLAPP law is] the single biggest lever that Congress can pull that can improve the integrity of consumer reviews. Reforms from the market side are also impacting the reviewsphere. Review aggregators have sprouted up, offering to estimate the true ratings of products by discarding reviews their scripts flag as suspect. Tommy Noonan has been running one such site for years. Called SupplementReview.com, it was created to be a fair critic of workout and nutritional supplements. “It all started in 2006 when I was still in college. My roommate gave me a supplement he had bought called N.O. Xplode. It was one of the first pre-workout supplements that was loaded with caffeine and designed to give explosive workouts in the gym. He claimed that the only explosion it gave him at the gym was having to run to the bathroom, so he gave the rest of the container to me,” Noonan says. “My first thought was, it’s too bad he didn’t know about this side effect before he bought it. [But] I searched Google and could not find any platform for supplement reviews, so I figured that it was time for me to start one.” The long-running success of SupplementReviews inspired Noonan to create ReviewMeta, which analyzes the reviews of thousands of items listed on Amazon. The site works to uncover reviews that are not “naturally occurring,” and filter those out before providing an adjusted rating. He says some of the biggest red flags are users with a single review, several reviews written in one day or giving five stars to every item they rate. This kind of vetting could change the business of consumer reviews. In fact, Noonan has already helped score one big victory against incentivized reviews (reviews left by users who receive a free or discounted version of a product in exchange for evaluation). At one point, Noonan estimated they made up one-fifth of all the reviews on Amazon. Like pay-per-review companies, third-party vendors appeared that would match manufacturers wanting to build a review history for new products with reviewers happy to take a look at free stuff. In September, the site ReviewMeta analyzed 7 million Amazon reviews and concluded that the average incentivized review was 0.4 stars higher than the average non-incentivized review. Moreover, it was discovered that many third-party review clubs allowed vendors to choose who gets to rate their products,

allowing them to cherry-pick subjects they thought would report favorably. “The third-party review clubs were a massive problem,” Noonan says. “Most of the reviewers knew that if they didn’t give everything a five-star review, they would probably be kicked off the platform. The sellers essentially ran the show and used these platforms as ways to generate thousands of positive reviews relatively cheaply.” Three weeks after ReviewMeta’s findings were released, Amazon announced it would discontinue incentivized reviews, with the exception of books or reviews facilitated through its in-house review shop, Amazon Vine. The fact that Noonan is expanding the scope of his review assessments after a decade speaks volumes about the demand for clean feedback. Although his methods cause some headaches for the big names in the review world, the day may come when those same companies thank him for saving consumer confidence in reviews. Every time there is another dispute or ambiguity concerning product reviews, the whole ecosystem takes a hit. With reviews becoming an important starting point on the customer journey, the evaporation of confidence in review quality authenticity would mean digital marketing chaos. Even now, there is suspicion stirring among consumers in regard to the legitimacy of measured feedback. “I don’t have any hard data to back this up, my gut says that [suspicions] are definitely more widespread than they were 10 years ago,” Noonan says. “The stakes are higher than they ever have been in the past. Not only are online purchases growing, but every retailer seems to have their own customer reviews sections. The tools to acquire fake reviews are much more abundant. With popular services like Mechanical Turk, Odesk, Fiverr and others, it’s now easier and cheaper to outsource extremely cheap labor to generate fake reviews. Social media makes it easy for brands to offer incentives for their fans to review them.” It’s not only consumer advocates like Noonan or Goldman who should want to guarantee a clean review ecosystem, nor big review sites like Amazon and Yelp. Rather, every brand that cares about making its voice heard on the platforms where it is judged should want to keep existing platforms in place. It’s a case of choosing between the devil you know and the one you don’t. Or as Troy Janisch of U.S. Bank puts is, “It’s in the interest of every company to retain the integrity of the platforms that customers choose to use. If we don’t do that, the platforms that exist today will wither, and new platforms will emerge where brands won’t be invited to participate at all.” m

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New

Kids

And The

Block 56

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A new app-based social network from LEGO appears to be doing the extraordinary: providing a safe space for children online while winning plaudits from parents

By Zach Brooke

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For close to two decades now, LEGO has been much more than a toy. What steps did the company take to become the omni-channel media company it is today? Why go in that direction?

hildren under 13 have

Like every successful brand, we recognize the world is changing around us and understand how to adapt while keeping true to our core principles. We have always had fun and construction at the core of our play experiences. Whether it’s playing with physical bricks, video games, apps, watching movies and videos or reading magazines, we have evolved to be where the kids are. As time, media and technology change, we have found ways to successfully deliver on our play promise of creating fun, playful experiences that inject humor into the narrative.

long been personae non grata on social networks. They’re prohibited from joining the likes of Facebook, Instagram and Snapchat by terms of service. Sure, some youths can easily lie about their ages, but what they see on those platforms isn’t intended for them. Enter LEGO. The Danish toy and entertainment behemoth spent two years developing a social app that would appeal directly to pre-teens while passing muster with concerned parents and international regulators. The final result was LEGO Life, a social network open to everyone but designed primarly as a space for users under 13 to share their LEGO creations. No audio, full video (the site allows stop-motion), text-based communication or identifying usernames or images are allowed, and parents must consent early and often to whatever their child sees and does. For its efforts, LEGO has won approval from parents and consumer groups since going live on January 31. But to better understand how the site operates, Marketing News spoke directly to James Lema, LEGO Life’s creative director.

How about setting up the social network, LEGO Life? What were the goals of the app from a marketing perspective, especially when you already have games and content on Lego.com?

We know that children have long revelled in the pride of sharing their LEGO creations with their peers and family. Until now, the primary means kids had for sharing were either in-person with friends and family or through the LEGO Club Magazine. The centerfold of our Club Magazine was the main spot for group sharing of kids’ creations and these community pages were the highest-rated pages for 10 years. By introducing a digital platform to facilitate and further this tradition, we can exponentially increase the amount of kids who can share their creations and the amount of times each child can share. Also, kids can give and get feedback and inspire each other to keep building. Our biggest challenge before we launched was whether or not kids would contribute to the platform. We wanted to make sure the content was LEGOfocused and knew there could be challenges around what kids might share. To our delight, kids have been contributing thousands of inspirational builds and content to our platform at an extreme rate. We’re happy the experience has been received so well.

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You already have a magazine called LEGO Life, which is aimed at children aged 5 to 9. You recommend older children download the LEGO Life app. Why the differentiation?

The LEGO Club magazine goes out to all 6 million members of LEGO Club across 18 markets worldwideâ&#x20AC;&#x201D;all of whom are enthusiastic LEGO builders and many of whom submit photos of their creations hoping to be chosen for one of a limited number of spots in the magazine dedicated to showcasing their LEGO creations. This same audience can now join LEGO Life which will allow all club members the opportunity to share as many of their builds as they like as often as they like. You have an entire section on Lego.com devoted to digital safety. How can parents teach young children about potential dangers in the fun LEGO Life online space?

The LEGO safety pledge adheres to UNICEF standards and is a method for parents to talk to their kids about digital safety while establishing a shared commitment to ground rules for online social behavior. In addition to the safeguards around sharing personal information and content moderation, we added a specific digital safety section for parents that conveys our approach to digital safety and illustrates the ways in which LEGO Life focuses on the safety of their children. What do parents need to be assured of before giving their children permission to use the app, and how did you alleviate those concerns?

We understand that the No. 1 concern among parents when it comes to social networks and other digital environments is safety, so naturally we kept this at the heart of the development of LEGO Life. We implemented as many safeguards as possible to prevent children from sharing personal information, images of themselves and anything that could allow other users to identify and locate one another. For example,

the LEGO Life name generator uses a random threeword mix to create a display name so children can choose from silly names like DukeCharmingShrimp or CaptainNoisyBadger. Additionally, the LEGO Emoji Keyboard was created to keep communication simple, universal, safe and fun. Children can only comment on each otherâ&#x20AC;&#x2122;s posts through a keyboard of recognizable LEGO emojis and elements, minifigure faces and stickers. You can express a world of opinions with a simple smile or heart. What kind of feedback have you been getting from parents since LEGO Life launched?

Recently at the LEGO World event in Copenhagen, we asked parents and kids what their opinions were of the app. Parents approve of the app because they know and trust the LEGO commitment to safety and fun. Kids told us the app inspires them to build. This is exactly what we were hoping for.

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Aside from creating a safe digital space, what notes did the app have to hit to remain consistent with the LEGO brand?

The main goal in developing LEGO Life was to give kids a safe space where they could inspire and get inspired to build more with LEGO bricks. Every aspect of LEGO Life embodies the sense of play, creativity, and humor inherent in the LEGO brand. Can you say how many users are active on LEGO Life, and what percentage are 13 or under? Is membership meeting or exceeding company estimates?

How does the “visualized hashtag system” work in the app?

The LEGO groups are the LEGO Life version of hashtags. Groups are arranged around areas of interest (animals, vehicles, heroes, etc.), LEGO themes (NINJAGO, Star Wars, etc.) and seasonal/regional topics (New Year, Valentine’s, etc ). Once kids follow a group, they will see updates from their favorite characters and themes within their LEGO Life feed, including interesting builds, images and challenges. Groups will expand as LEGO Life membership grows and trends and interests take shape. Can you link to anything outside of the network from within the app?

The only items we currently link to outside of the app are other LEGO apps. Before a user can visit these apps, we put a parental pop-up/check to ensure that users know they are about to leave the app.

We’ve had an overwhelmingly positive response so far and just crossed the threshold of 1 million downloads by our fans. In our first week, we became the No. 1 children’s app in each launch market, and we have been very pleased with the enthusiastic response we are receiving from parents and kids alike—both in the comments they are sharing and in the volume of LEGO creations they are uploading to LEGO Life. A lot of the social content on LEGO Life is created directly by LEGO. What does your content team look like and what are its goals? Are they a bunch of social media and design experts playing with LEGOs all day?

LEGO Life is a healthy mix of user-generated content and content created by our editorial teams. These editors are highly dedicated to their craft. They spend each day reviewing activity within the app and adjust their editorial strategies to maximize user engagement. They coordinate campaigns across all our product groups and themes and suggest the best ways to reach our audience from a mix of challenges, articles and videos. They also build and play with a lot of LEGO bricks! Ultimately, the goal is to strike the right balance in engagement and inspiration to ensure a steady stream of usergenerated content and community.

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Like every successful b r an d , w e r e c o g n i z e t h e w o r l d i s c h an g i n g a r o u n d u s an d u n d e r s tan d h o w t o adapt while keeping true to our core principles.

What about the content monitoring team? How big is it, and what is it looking for?

Every post to LEGO Life is monitored and viewed by a human. We use image detection software for an initial review and then, based on the content, it will receive varying levels of review from our team. The main requirement for posting is that the content must somehow be LEGO-relevant—and brand-appropriate, of course.

Angry Birds characters. How do you determine what other brands can enter the app space? Are there any limitations on who can enter the space and what they can look like?

The LEGO Batman, LEGO Star Wars and LEGO Minecraft content we produce within the app is based on licensed themes that are part of the LEGO universe. If we currently produce a LEGO set for a certain license, there is a good chance at some point you’ll see a group or content based on that theme within LEGO Life.

Why put this all in an app and not make it a separate website accessible from a browser?

The goal is to provide an experience that kids can enjoy wherever they are. We know that more kids today have their own tablets or mobile phones and they expect to have this kind of experience available to them. They also are much more app-centric and less motivated by branded websites. Have you thought about incorporating advertising or sponsored content at all?

LEGO Life does not have any third-party advertisement, nor are there plans to include any. What about co-branding? LEGO Life includes Batman, Star Wars and Minecraft Lego sets. I think I saw the legal portion of the app mentioning

It’s been reported that you’re looking into the possibility of adding in-app chat functions as well as allowing users to upload narrated video. Do you have any updates on if and when those features might be added? How about any other features not currently part of the LEGO Life experience?

In terms of in-app chat and user video, those are ambitions we have for the future, but we need to make sure we take the appropriate time to develop them in a safe, responsible and fun way. LEGO Life is an agile project in every sense. Our development roadmap can change based on the way our users are engaging in the app. We may have plans to bring in a new feature, but if we see kids are using the app in surprising ways, we will prioritize development of features that benefit our users’ habits. Every day, we see new ways kids are using the app, and it’s been a pleasure to see the builders of tomorrow inspiring each other. m

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career advancement

on the record

Prizing Consolation A new social platform cushions the blow of job rejection with free training By Zach Brooke | staff writer

 zbrooke@ama.org

ob hunting is seldom fun. Getting rejected for a coveted position is bad enough, but most professionals understand the special kind of frustration that comes with being ghosted by hiring managers. Now, in the age of employment review social sites, job rejections are no longer just bad news for candidates, they are hazardous for companies as well. Disgruntled applicants vent on sites like Glassdoor, reflecting poorly on everyone. Combating this trend are HR consulting firm Mercer and software company CareerArc, which have teamed up to launch Candidate Care, a job skills and search platform that employers can offer for free to candidates who they don’t hire. Courtny Cloeter, partner and U.S. growth leader at Mercer, explains why Candidate Care is a win-win for applicants and employers.

What services are included in Mercer CareerArc Candidate Care, and how long are rejected applicants given access?

The Mercer Career Arc Candidate Care system is a robust online platform designed to give the candidate an edge in their career search. The service lasts for six months for the end user from the date they activate. Users of the service enjoy unlimited access to many critical features including notification of open job alerts and access to a job search engine with millions of opportunities, integration with social networking sites that support the job search (including LinkedIn), résumé and cover letter guides and workshops, video interviewing practice, innovative skill assessment tests, networking assistance and industry research databases.

What does the networking assistance feature look like?

The networking assistance module enables candidates to optimize their social media presence and leverage research tools to uncover their next job opportunity through access to industry associations, LinkedIn and Facebook social media profile guides.

How does Mercer Match work?

Mercer Match is a game-based, neuroscience platform that is a standalone product we have integrated into the Candidate Care platform to provide additional resources for the declined candidate to leverage when understanding marketable skills and new career opportunities.

Do rejected candidates have access to job postings not listed on public job aggregators?

Yes, in addition to integrating job postings from web aggregators, the Mercer CareerArc Candidate Care Platform also boasts proprietary job listings from enterprise customers and access to network and research databases with links to associations to further discover career opportunities outside of the platform.

Q A

How many businesses are currently using Candidate Care?

There are currently 37 companies utilizing the platform. Through continuous engagement and education with HR leaders on the importance of

employer brand … we expect continued interest as HR leaders continue to act as employer brand stewards for their respective companies.

How many rejected candidates are making use of Candidate Care? Can you share a percentage of eligible candidates who use the service?

There are tens of thousands of candidates who have accessed the system. Activation rates vary from organization to organization depending on the marketing and communication efforts with the declined candidate population.

Can all types of businesses use it, or would it only work well for employers in certain fields? Would a health care worker, a paralegal, a marketer and a teacher all benefit equally from Candidate Care?

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on the record

career advancement

What about following up with rejected candidates to see if theyâ&#x20AC;&#x2122;ve posted about the employer that rejected them?

Yes, we have features on our product roadmap to help organizations hear directly from candidates via social media and encourage those that had a good experience to let those employers know.

Mercer and CareerArc report rejected candidates are three times more likely to post negative reviews of a company online. Where is that figure coming from?

All businesses can benefit from protecting their employer brand and providing their declined candidates with a career transition system to support their job search. The platform is built with adult learning principles in mind and is flexible for all industries of work and all job types, from hourly, part-time and entry-level workers to director and executive-level job seekers.

What feedback are you hearing from clients and candidates?

The feedback we have received from job seekers and clients has been overwhelmingly positive. The platform star rating is currently 4.3 out of 5 based on job seeker feedback. A global consulting firm has already had more than 500 declined candidates rate the application 4.7 out of 5.

How likely is it that a candidate is declined for reasons that can be addressed by making use of the career resources?

The resources in the platform are designed to significantly improve the steady state of existing applicants and have been vetted and utilized by workforce development associations and state governments in their retraining initiatives for unemployed workers.

Do you follow up with rejected candidates to see if they are employed by the end of the complimentary period?

Yes, we conduct surveys and connect with end users to gain insight into their platform usage and success in landing a new job.

According to our 2016 Candidate Experience Study, nearly 60% of candidates have had a poor candidate experience, and 72% of those shared that experience online or with someone directly. This provides a tremendous opportunity for employers to be proactive rather than reactive in addressing their potential candidate pool. Frustrated candidates are taking to sites like Glassdoor and commenting about employers on social media, describing the interview and application process, the way they were treated or if they received a response to their application at all. Many never get notified.

Other research shows 40% of companies already neglect to inform declined applicants of their status. How will adding this extra step decrease this number or distinguish companies that use Candidate Care?

The introduction of Candidate Care will enable organizations to solve two challenges with one solution. At once, they can update their application response processes and communication while also offering a tool for declined candidates. This will truly separate these organizations from their competitors, as they will be seen as organizations that care about their talent community and go the extra mile. m April/May 2017 | marketing news

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job hunting

How to Use Social Media to Scope Your Next Job Job hunting is a digital process, and social media is a tool both recruiters and candidates are using to find the right opportunities. Take these steps to make the most of your social media presence to find and land your next job. By Jessica Schaeffer

s a job seeker, there are so many avenues to start your job search. You can opt for traditional job boards such as CareerBuilder and Indeed; you can tap your network or attend events and conferences to broaden your reach; or you can turn to social media sites such as Facebook and Twitter, which are increasing in popularity among job seekers.

If you find yourself perusing jobs on LinkedIn or using Glassdoor to screen companies before applying, here are some tips to focus your job search using social media. Determine your goal. Social media can be a time suck. We’ve all gone on LinkedIn to do one thing and found that 20 minutes has gone by

career advancement

without even accomplishing the task we set out to do. Don’t make this mistake. Ask yourself, “What’s my goal in using social media in my job search?” Is it to find open positions? Is it to create a target list of companies you are going to apply to? Is it to research more about companies you are interviewing with? Do your research. Once you know your goal, it’s time to research. If you want to use social media to find job postings, find out what channels employers are posting jobs on. LinkedIn has an extensive job board that many employers are taking advantage of, which might be a good place to start. Facebook has a new job board. Instagram and Pinterest may be the right avenue to identify new opportunities. It depends on your industry and the position you are looking for. Make sure you know where you should be investing your time. April/May 2017 | marketing news

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career advancement

job hunting

If your goal is to learn more about organizations before applying or to increase your knowledge before an interview, Glassdoor is a great tool. Glassdoor displays feedback from current and former employees and what they consider to be the pros and cons of the company. Keep in mind, what one person gripes about on social media might be something that you find valuable and important in an organization. Ask yourself if an opportunity makes sense for you. Depending on your level of social savvy, certain channels may not make sense for you to activate your job search. Use your knowledge to your advantage. If a platform feels clunky, or you question your knowledge on how to navigate all the nuances of it—or you don’t have a presence there yet—you probably won’t end up using it as effectively or keeping it updated. Don’t force it. Do a pre-mortem. The odds are high that if you apply to a position via social media, the potential employer will screen your profile, so take a pre-mortem. Peruse your online profiles. Google yourself to see what comes up. Does it present you in the best light and make a strong argument for why

you are the right candidate for the role? Is there anything that might cause a future employer to screen out your application? If so, fix the problem, or scrap that channel as part of your job search. Plan. Create a plan for exactly how you are going to spend your time on social media. If you are creating a well-rounded social media job search strategy, you can break your time into a few areas. I recommend setting aside time for each of these activities: Build your profile. Make sure all your information is up to date. Complete any missing information. Scrub any irrelevant information or anything that portrays you in a bad light.

Share relevant information. Show

you are a thought leader in the space. If you write and blog frequently, share that. If you don’t, find articles that are relevant to your industry or your role, and share and comment on those to show your expertise.

Tap your network. Set a goal for how many new connections you want to make and how many current connections you want to reach out to. Research where they work and who

they are connected with. Does it make sense to ask them for an informational interview or an introduction to someone in their network?

Research companies. Social media offers great insight into what a day in the life of an organization looks like. Take advantage of it. Make a short list of companies where you want to work. Then, cater your application, cover letter or introductory e-mail to explain what you know, why you would be a strong addition and how you can add value immediately.

Analyze. You may not see results immediately, but you need to be asking yourself, “Is it working?” Are you following the plan you laid out, or are you getting sucked into the social vacuum and losing focus? Are the social media channels you are using helping you achieve the goal you set out in the first place? If the answer is, “No,” you may need to revisit your research and see if you are using the most effective channel. If the answer is, “Yes,” rinse and repeat. m Jessica Schaeffer is director of marketing and communications at LaSalle Network, a national staffing and recruiting firm.

marketing news | April/May 2017

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advertisers’index

ADVERTISERS’ INDEX Quick source for contacting the suppliers in the April/May 2017 issue of Marketing News. 2017 AMA Calendar of Events . .... inside back cover URL: h ttp://ama.marketing/2017events

AMA Whitepapers .................................................. p. 25 Email: sales@ama.org URL: http://www.ama.org/whitepaper

AMA 2017 Advanced Research Techniques Forum ....................................... back cover ttp://ama.marketing/ARTFORUM2017 URL: h

AMA’s Virtual Conference Series ......................... p. 23 Email: anelmes@ama.org

AMA Job Board ....................................................... p. 64 ttp://jobs.ama.org URL: h

HOW Design Live ............................................ pp. 6, 7 URL: http://www.HowDesignLive.com

AMA Marketing & Public Policy Conference . ..... p. 17 ttp://ama.marketing/mppc17 URL: h

Marketing News ...................................................... p. 67 Email: sales@ama.org URL: http://www.ama.org/mediakit

AMA’s Marketing Resource Directory ................... p. 3 Ph. 1-888-777-6578 URL: http://marketingresourcedirectory.ama.org AMA Members-only Webcasts . ............................. p. 5 Email: savdic@ama.org URL: http://www.ama.org/MOW

Salesforce ..................................... inside front cover URL: http://www.salesforce.com Thank You to the 2017 International Collegiate Conference Sponsors & Exhibitors . ..................... p. 15 URL: http://www.ama.org/icc

APRIL/MAY 2017 | MARKETING NEWS

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#OfficeGoals A peek inside the marketers’ offices that make us drool

Gorilla Glue: Family-owned and -operated, The Gorilla Glue Company’s culture is a mix of high drive, authenticity and casual charm. Employees have an immense amount of pride in the company, as well as in the quality of the products they collectively represent. M+A led the Gorilla Glue marketing and design team in conceptualizing a visually cohesive office that highlights the company’s culture and brands in a bold, rustic and playful way. The office features natural wood architectural elements to frame the space and set the stage for simple, meaningful brand elements. Environmental graphics are thoughtfully integrated throughout the office to deliver an authentic message to visitors and staff.

Photos: Josh Beeman Photography

Architecture and Interiors by M+A Architects

marketing news | April/May 2017

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