Marketing News: October 2018 by Molly Soat

AMERICAN MARKETING ASSOCIATION

AMA.ORG

OCTOBER 2018

4 UNDER 40 EMERGING

LEADERS

OCTOBER 2018 NO.

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table of contents AMERICAN MARKETING ASSOCIATION

3-6 8-15

SEEN ON AMA.ORG ANSWERS IN ACTION • Snapshot • Core Concepts • Ethical Marketing

16-18

SCHOLARLY INSIGHTS • Profitability

20-23

EXECUTIVE INSIGHTS • David Aaker • Russ Klein

51-54

CAREER ADVANCEMENT • Jobs • Culture

#OFFICEGOALS

4 Under 40 

The AMA’s 4 Under 40 Emerging Leaders Award recognizes mid-career professionals with impressive experience under their belts, who still have many years ahead of them in their field.

 How to Solve a Problem

There’s no one way to solve a problem—in fact, you should avoid using canned approaches. But there are ideas, steps, plans and questions that problemsolving professionals have found useful for decades.

FIND OUT MORE AT

AMA .org

OR FIND US ON

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OCTOBER 2018

LETTER FROM THE EDITOR VOL. 52 | NO. 9 AMERICAN MARKETING ASSOCIATION

Bill Cron Chairperson of the AMA Board 2018-2019 Russ Klein, AMA Chief Executive Officer rklein@ama.org EDITORIAL STAFF

Phone (800) AMA-1150 • Fax (312) 542-9001 E-mail editor@ama.org Molly Soat, Editor in Chief msoat@ama.org Michelle Markelz, Managing Editor mmarkelz@ama.org Hal Conick, Staff Writer hconick@ama.org Sarah Steimer, Staff Writer ssteimer@ama.org Bill Murphy, Designer wmurphy@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 June/July 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.

Who Will Lead Marketing’s Evolution?

igital tools and techniques are evolving the marketing profession at breakneck speed. Our biannual Marketers’ Confidence Index findings show that working marketers are concerned that their leaders don’t know enough about such technologies, and this lack of understanding is holding marketers back as they try to defend their efforts with data-based reporting. Filling this gap are emerging leaders like Andrew Malcom, Liliana Ciurlino, Chris Smith and Bobby Singh, the AMA’s 2018 4 Under 40 Award winners. From a pool of nearly 70 nominees, these four stood out for their advancements to marketing and their leadership. We had the opportunity to host them at the AMA support center for a day and learned what inspires them, what motivates them and what they still hope to achieve. This crew is ambitious and creative yet conscious of the many ways marketers today must consider how they can do no harm while chasing ever more customers and conversions. Be sure to check out the “Answers in

Action” podcast for extended interviews with each of the winners. I think you’ll find they are all distinct, coming from different backgrounds, industries and influences. The thing that unites them is not just their age, but their commitment to constant evolution, both personally and professionally. How are you evolving? MOLLY SOAT Editor in Chief @MollySoat

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

Annual subscription rates: Marketing News is a benefit of membership for professional members of the American Marketing Association. Annual professional membership dues in the AMA are $220. Annual subscription rates: $35 members, $145 nonmembers and $190 libraries, corporations and institutions. International rates vary by country. Nonmembers: Order online at amaorders.com, call 1-800-633-4931 or e-mail amasubs@ ebsco.com. 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). 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. Copyright © 2018 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. Printed in the U.S.A.

KEVIN KELLY

LAWRENCE A. CROSBY

Kevin Kelly is president and founder of Bigbuzz Marketing Group, having launched the firm in his garage in 1995. Today, he oversees the agency’s client relationships, develops and innovates its suite of services and provides the creative vision for long-term growth.

Lawrence A. Crosby is the retired dean of the Drucker School of Management. He is the chief data scientist at the KH Moon Center for a Functioning Society, a part of the Drucker Institute at Claremont Graduate University.

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How confident are you that your organization’s marketing team . . . NOT CONFIDENT

CONFIDENT

CHANGE VS AUGUST 2017

Is able to preserve brand consistency as marketing goes digital

15%

61%

+9%

Collaborates well with all parts of the organization

24%

49%

+1%

Is integrating and embedding digital within marketing functions

26%

46%

+5%

Is equipped for marketing in a digital age

35%

41%

+6%

Has senior management that sufficiently understands social and digital marketing

43%

33%

+4%

Receives sufficient training on marketing in a digital age

41%

29%

+3%

Has insight in the true ROI of all key marketing initiatives

45%

24%

-1%

KANTAR CONSULTING

Marketers Feel More Influential and Confident in Consumer Spending in the Second Half of 2018

arketers are more optimistic about their power and influence than they were six months ago, according to the latest Marketers’ Confidence Index. The July 2018 index — a survey by the American Marketing Association and Kantar Consulting that captures marketers’ optimism on customer spending, marketing budgets and the investment climate — also revealed an improvement in marketers’ confidence in consumer spending and brand consistency across digital channels. In the January 2018 index, 61% of marketers believed the power and influence of marketing would increase over the next few years, 71% believed

the same in the second half of the year. The report also finds that marketers are more confident about consistently managing their brand across digital channels than they were last year. In the July 2018 index, 61% say they’re confident that their team can preserve brand consistency as marketing goes digital, up 9% from August 2017. Marketers say that they’re excited by analytics, marketing automation, data science and artificial intelligence going into the future. They also believe that CMOs need to learn more about these tools and how they will help marketing teams achieve their goals. Marketers’ expectations for revenue growth dropped slightly

since January. While 59% of marketers expected their revenue to improve in the January index, 55% expected revenue to increase in the new index. However, 58% of marketers believe that their revenue growth is better than that of their competitors — compared with 56% in January’s index. Marketing budget allocations remained the same since January, but marketers slightly increased their spending on creative and sponsoring. Marketers decreased spending slightly on market research and insights, as well as analytics. This report — conducted via a short online survey from July 3 to July 17, 2018 — had 291 participants, the majority (63%) of whom were female. Forty-nine percent of respondents were 45 years old or younger. Managers or vice president/directorlevel marketers comprised 55% of respondents. —HAL CONICK

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You Don’t Need More Salespeople, You Need More Productivity

et’s say you’ve got more opportunities than you think your sales team can handle. What’s the solution? Hire more salespeople, of course. Wait a minute. You may not need more salespeople. You may need more productive salespeople. Before you hire anyone, ask yourself two questions about your sales team: 1. D o they have enough selling time? 2. A re they using their selling time effectively?

Maximizing Selling Time According to CSO Insight, salespeople only spend two days a week dealing directly with prospects and customers. They spend more than one day per week on research and lead generation. What if you could increase real selling time by a half-day each

STANDARDIZE PROPOSALS AND CONTRACTS

week? That’d be a 25% increase. How much additional revenue would that generate?

If your salespeople are creating their own proposals and contracts, they are wasting time and putting the company at risk. Have your lawyer and CFO create the templates with assistance from the marketing department.

Here are six ways to minimize nonselling time.

AUTOMATE PROSPECT RESEARCH

Your salespeople are wasting time by poking around the internet for business. They should be subscribing to alert services, using business intelligence and tapping social media sites.

DELEGATE OR OUTSOURCE LEAD GENERATION AND CULTIVATION

Your marketing department should generate the leads, cultivate them and give them to a salesperson only when the leads are sales-ready. Left to their own devices, most salespeople haphazardly generate and nurture leads.

STANDARDIZE SALES TOOLS

Salespeople love to create their own brochures and presentations. That’s another waste of time. Salespeople may not convey the right message. Your marketing department should create the sales tools.

DELEGATE CROSS-SELL/UPSELL

Salespeople should not spend their time selling small projects to existing customers. Train your client services team to do the low-level selling. Let your outside salespeople focus on deals with bigger customers.

DELEGATE CUSTOMER SERVICE AND ADMINISTRATION

Dealing with clients and customers on routine matters can be timeconsuming. Make sure your client services team handles customer service and customer administration tasks. Involve the salesperson only when there is a serious issue — or a big opportunity.

Optimizing Selling Time Let’s say you’ve taken the steps, and your salespeople have 25% more selling time. What now? Focus on three areas: 1. Pursue the best opportunities. 2. Consistent sales activity. 3. Create a standardized sales system.

The Best Opportunities Dead-end situations can be a trap for salespeople. Sometimes they pursue opportunities where there is no possibility of success. Other times they don’t know when to abandon an opportunity. Coach your

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salespeople on how to identify good opportunities so that they avoid dead ends. A particular company may be an attractive target, but does your salesperson have the right connections there? Is the deal worth pursuing? Similarly, you can teach them to recognize when a deal is going nowhere. Then, it’s time to move on to more promising opportunities.

how sales are made. Often, sales is a numbers game. If your salespeople don’t make enough contacts, they won’t have enough conversations that eventually lead to meetings and proposals. It all starts with activity. Again, you can fix this. Perhaps a salesperson needs to put in a greater effort — or maybe clarifying the message will do the trick.

Sales Activity

A Sales System

A key determinant of sales success is the salesperson’s activity level. Your salespeople should have weekly numerical targets for new contacts, phone calls, phone discussions, meetings, proposals, events attended and referrals generated. Initial contacts lead to phone discussions. Discussions lead to meetings. Meetings lead to proposals. Proposals lead to business. That’s

A salesperson may be calling the right people but still not getting results. If he is not documenting his sales interactions, follow-ups may fall through the cracks, and opportunities may be missed. He may also be alienating prospects and customers because he fails to follow up as promised. Is your salesperson using your CRM

system? Is he summarizing his sales calls and meetings appropriately? Does he have an up-to-date task list? You can fix this, too. Perhaps he needs some coaching on your sales process or a tune-up on using your company’s CRM system.

Less Is More Seasoned field salespeople are expensive. According to Four Quadrant, LLC, the cost of a salesperson can be $380,000 a year. Add to that the cost of recruiting, training and management time. What happens if the new hire fails? You’ve got severance costs and more management time. After that you’ve got to hire someone else, and the process repeats itself. You’ll be better off if you can get more out of your existing sales team. Hiring more salespeople should be a last resort. —PETER HELMER

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SNAPSHOT

The Truth Is … As Advertised

of government by speaking directly to its audience in a new ad campaign.

dramatic and remind all of us about the importance of truth and the importance of independent, quality journalism and the role it plays in keeping power accountable,” says Tim Gordon, executive creative director at Droga5. “A simple metaphor could be to remind us all that journalism is the lighthouse when we’re lost in a sea of untruths.” The Times’ goal was three-fold: to stand up for itself as anti-press rhetoric escalated, to assure readers that they have a place to turn for the truth and to attract more subscribers so it could afford to strengthen its coverage.

Goal The New York Times sought the help of the ad agency Droga5 shortly after the 2016 presidential election. Trump and his supporters were spiteful toward the mainstream media prior to his election, and his win didn’t end their vitriol. “The Times wanted to do something

Action The New York Times and Droga5 created the “Truth Is Hard,” the newspaper’s first brand campaign in a decade. The initial television ad, which debuted during the 2017 Academy Awards, featured simple black text on a white background. Each sentence began with “The truth is” and

The New York Times launched its first brand campaign in a decade and garnered more digital subscribers than any news outlet ever BY SARAH STEIMER | STAFF WRITER

 ssteimer@ama.org

resident Donald Trump has popularized quite a few catch phrases, but perhaps none is more well-known and repeated as “fake news.” To journalists and media outlets, this phrase is akin to doctors hearing antivaccination arguments. The New York Times is one of the main targets of the president’s ire. Living up to its role as the Fourth Estate, The Times performed a check on the power

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SNAPSHOT

flashed through conflicting statements, such as “The truth is we need a full investigation of Russian ties,” and “The truth is leaking classified information is the real scandal.” Throughout the text statements, voices in the background added another layer of conflict. In the end, the voices gave way to a few simple piano notes. The text slowed and morphed to read “The truth is hard,” “The truth is hard to find,” “The truth is hard to know” and “The truth is more important now than ever.” The spot ended with the iconic New York Times nameplate. Gordon says the black and white used in the ad was inspired by the paper. The layering and conflict of ideas in the text and voices mimicked the clutter of news. “There’s a bombardment of information and so many things grasping for your attention,” Gordon says. “We wanted to provide a very clear and impactful message.” Because the ad was airing during the Academy Awards, two phrases were added: “The truth is celebrities should keep their mouths shut,” and “The truth is everyone has the right to speak their mind.” The ad was aired during the awards ceremony to reach the largest audience possible. Plus, it was likely that some award winners and presenters would make political comments during the show, providing an easy way for The Times to insert itself into the conversation. The television spot ran nationally for a week after the awards, and digital ads continued for a month. The campaign also included social, print and out-ofhome ads, all featuring the simple blackon-white design. “The initial visual approach reinforced the starkness of their intended message: that the truth is under fire, and it is as clear as black and white,” says Drew Neisser, founder and CEO of social media and marketing consultancy Renegade. “This visual approach also made it cut through the noise of the typical full-color approach used by 99.9% of advertisers.” In the months following, Droga5 and

The Times also launched a wave of films directed by Darren Aronofsky (director of “Black Swan” and “Requiem for a Dream”) that give viewers a look behind some of the images photojournalists have captured for the paper. The videos are a series of stills accompanied by commentary from the photographers. The short films—about one minute each—were boosted whenever the subjects were trending in the news cycle. The “Truth Is Hard” ads were also served when readers hit a paywall on The Times’ website. Results In 24 hours, the “Truth is Hard” ad won more subscribers for The Times than the paper had gained in the preceding six weeks. The first quarter of 2017, when the ads debuted, was The Times’ best quarter ever for subscription growth. In the second quarter of the year, The Times

COMPANY

The New York Times FOUNDED

1851 HEADQUARTERS

New York CAMPAIGN TIMELINE

First iteration debuted Feb. 26, 2017, and ran for about two weeks. CAMPAIGN RESULTS

The “Truth Is Hard” campaign earned 5.12 billion impressions and $16.8 million in media value. It also won accolades from the Cannes Lions, the Drum Digital Trading Awards, the One Show, D&AD Pencils and the Webby Awards.

answers in action

passed 2 million digital-only subscribers, a first for any news organization. The “Truth Is Hard” campaign earned 5.12 billion impressions and $16.8 million in media value. It also won accolades from the Cannes Lions, the Drum Digital Trading Awards, the One Show, D&AD Pencils and the Webby Awards. “I think the real testament has been the longevity of it,” Gordon says. The campaign has been replicated in popular culture, including on T-shirts from designer Sacai (worn by musician Frank Ocean) and spoofs by “The Late Show.” “The original posters were used as protest signs. People were hanging them on their wall. It’s a message you can return to.” At a time when elected officials challenge the press, Neisser says the campaign cemented The Times as a leader in the battle for truth. “It hits on a nerve that is both topical and timeless, that a free press is fundamental to the health of our democracy, whether or not a particular leader likes what is being reported,” he says. Neisser interviewed The Times’ COO Meredith Kopit Levien for Ad Age about how her team has positioned The Times as a consumer brand. Neisser says people outside of the paper had strong feelings about The Times—but the staff didn’t think of itself as a brand. The “Truth Is Hard” campaign acts as a rallying cry for the entire organization to refocus on delivering the truth. “These actions remind the public that The New York Times is not just a news organization, but one that is aligned with the very foundations of a free society,” Neisser says. “It’s rare that an ad campaign operates on such a heady level.” The campaign continues to have new iterations, including a January 2018 version with the tagline, “The truth has a voice.” The spot debuted during the 2018 Golden Globes and referred to the stories of sexual harassment that had recently come to light. “Unfortunately, [the campaign] almost becomes more relevant day by day,” Gordon says. m

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CORE CONCEPTS

The Best Way to Respond to Social Fury? It’s Still Up for Argument. We’re in the era of online outrage, and it’s affecting brands small and large. How can marketers deal with the outrage while staying sane? BY HAL CONICK | STAFF WRITER

 hconick@ama.org

imberly Legocki got her first taste of online fury in the era of the blogosphere. It was the mid-2000s, and she was handling marketing and communications for JohnsonDiversey (now Diversey Inc.). Suddenly, blog and forum posts popped up asking for people to boycott JohnsonDiversey and sign petitions against its wage and environmental practices. Legocki thought the angry activist posts were a small, yet curious, blip on her marketing dashboard. A few years later, as director of social media relations at California State University East Bay, she saw more anger—a lot more. “That’s where Twitter really became involved,” she says. “There were more technologies that allowed us to monitor our brand name and keywords, and that’s when we started to see a lot of that anger and venting.” Businesses of all sizes—from ma-and-pa sandwich shops to Fortune

500 companies—have felt social fury. A brand doesn’t need millions of followers to deal with angry, sometimes vindictive, customers online. “My experience as a practitioner drove me to want to know how to deal with it,” Legocki says. “This is not going away. In fact, it’s increasing.” As Legocki transitioned from working as a practitioner to studying for her doctorate in business administration, the anger on social media held her attention. Research on social anger against brands is thin, so she decided to do her own. Legocki spends her days monitoring “outrage events,” which she says have grown exponentially, giving her plenty of ammunition for her studies. In one such study, still under review, Legocki and Kristen L. Walker, also of California State University, wanted to find the patterns of angry posters during outrage events. Legocki and Walker

ranked 14,000 English words on an emotional scale and studied reactions to three different social media crises— in all, they examined 9,500 tweets. The researchers separated tweets by behavioral intention, emotional intensity and number of characters. The study found something surprising: Most social media anger is composed of retweets. People usually tweet something angry once and exit the conversation. But a small group of less vitriolic—but more persistent—posters may be cause for concern. According to the study, 80.9% of those who speak out against brands on social media are “hotheads,” people who vent and post emotionally charged content toward brands, mostly through retweets. The other 19.1% are “rational activists,” people who write original content with low emotional intensity focused on harming and seeking remedy from brands. The rational activists may seem less explosive—they usually aren’t cursing or telling you to die— but Legocki says that they may deserve brands’ attention. “Nearly 84% of all consumers participating in one of three social media crises we examined posted fewer than two times, an average of 1.19 times,” Legocki and Walker wrote in the research paper. “With only 16% of consumer activists writing original content, the quality of a post may be worth more of a brand’s time than simply the quantity of posts.” On most occasions, Legocki says that angry social media posters will retweet another angry post, adding their own brief commentary—perhaps a “WTF” or an angry emoji. But marketers should pay attention when calmer online posters call for action. “They’re not going to let it go,” Legocki says. “Their language is not inflammatory. It’s very well-thought out, it’s low emotion and very rational. As a practitioner, I know that I tend to overlook them because it’s not high-arousal, it’s not inflammatory.” Some Fury Strengthens Brands Outrage events often have negative outcomes. Travis Kalanick, former CEO of Uber, stepped down after a series of

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CORE CONCEPTS

public gaffes. United Airlines lost the trust of many customers—and took a momentary-but-gigantic stock hit—when a video of police and United employees forcibly dragging a passenger off a flight was posted to social media. But are all online outrage events equally bad for brands? Not necessarily, says Joachim Scholz. Scholz, assistant professor of marketing at California Polytechnic State University, says that some brands can use outrage events to their advantage. While brands should respond to and apologize for mistakes, harmful products and mistreatment of customers, Scholz believes some outrage events— “firestorms,” he calls them—can strengthen a brand’s position and bond with its customers. One firestorm has held Scholz’s attention for years. Protein World, a U.K.-based supplement brand, created a gigantic advertisement featuring a photo of a lean, bikini-clad woman with a caption asking, “Are you beach body ready?” Many critics accused the company of fat-shaming and creating unrealistic body standards; the company disagreed, saying that it was empowering people to be healthy. But the company didn’t just leave it there—it stirred the pot on social media, tweeting that “We are a nation of sympathizers for fatties” and calling its critics “lazy and weak.” Usually, this kind of vitriol from a brand would mean a fast apology, but Scholz says that it was part of the company reframing the criticism in its favor. Protein World’s brand voice has been bombastic, but it has also been supportive of healthy eating habits, motivational for those who exercise and empowering for followers trying to get healthy. The controversy fit Protein World’s brand. “It provided an opportunity for Protein World to say that we are strong in this crisis, and that resonated with the customer,” Scholz says. Although online outrage events may feel routine, they’re still a new phenomenon. Nobody has figured out a perfect way to respond to them or stop them, nor have researchers figured out what effect they can have on

brands. But Legocki and Scholz agree that most marketers are not prepared for the moment when these events happen to them. They offer this advice based on their studies. Monitor Your Keywords Brands should monitor keyword notifications for words like “boycott” and “greed” plus the brand name, Legocki says. These words are calling cards of the moreeffective, longer-lasting rational activists. Not every mention will lead to action, she says, but if petitions start popping up, that’s a sign for brands to address their critics. At this point, rational activists are looking for brands to make changes, and they likely won’t let it go until those changes are made. Stay Calm The first thing marketers should do during an outrage event is step away from the screen and stay calm, Legocki says. Don’t get caught up in the arousal and colorful language of the hotheads. Staying calm may be hard. It’s not every day that most marketers look at their social dashboard and see 500 people furiously tweeting at them, but Legocki says that calmness will help marketers figure out their next steps without falling into the hotheads’ trap. “If it’s just a lot of retweets, chances are that it’s the kind of people who are looking to vent, the hotheads,” she says. “They’re going to retweet 1.2 times, and that’s it. They’re out of there.” In the heat of an outrage event, marketers spend much of their time responding to these hotheads, Legocki says, but she believes these higharousal users are simply looking for the comradery of fellow hotheads. “They’re not looking for much from the company beyond maybe the obligatory apology,” she says. “The best thing for the practitioner is just to apologize and move on.” Use Outrage to Grow Brands should always avoid being nasty, Scholz says, but brands that want to use outrage to their advantage should find a balance between infuriating their critics

and keeping their brand voice. Wendy’s has seemingly perfected this balance on Twitter. The company, with nearly 3 million followers, regularly makes fun of followers and competitors. It once responded to an error-filled tweet from McDonald’s with “When the tweets are as broken as the ice cream machine.” For outrage to benefit a brand, Scholz says that companies must understand their customers, their critics and the potential firestorm they’re facing. “I think there are a couple of steps you want to follow: First you want to ask yourself how right your critics are. Do they have a point?” he says. If they do, it may be better to acknowledge their point, apologize and move on. “The next question you have to ask is to what extent the crisis or controversy fits your brand.” If the crisis or controversy doesn’t fit the brand, he says that it’s best to leave it alone. Reassess Your Approach No matter how marketers respond to social outrage, they should always be willing to change their tactics. Protein World went too deep into the firestorm, Scholz says. At one point, the company’s CEO sent tweets— now deleted—challenging the mental health of critics and comparing some to beached whales. Scholz says that the company lost its moral high ground in a flash. “The very thing they were criticized for, they were then guilty of,” Scholz says. The company has since taken a lighter tone with critics on social media, he says. Companies should also be willing to change because there’s simply no right way to respond to outraged social media users. Legocki has spoken with peers and practitioners and read advice from experts; every answer they give seems to suggest something different. Do nothing? Issue a press release? Stir the pot to make people angrier? Apologize? No one knows the right way to deal with social outrage. For now, it’s situational. “That’s one of the reasons I chose to study this,” Legocki says. “We’re all dealing with it in small ways, and it catches us by surprise.” m

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ETHICAL MARKETING

What Are the Ethics of Neuromarketing? Neuromarketing probably can’t help marketers “push the buy button” in customers’ brains, but can it influence their decisions? And is it ethical? BY HAL CONICK | STAFF WRITER

 hconick@ama.org

‘W

e have learned more about the brain in the last 15 years than in all prior human history, and the mind, once considered out of reach, is finally assuming center stage,” wrote Dr. Michio Kaku, a theoretical physicist, in his 2014 book The Future of the Mind. Kaku was right: The fMRI—or functional magnetic resonance imaging, a tool that allows noninvasive study and mapping of brain activity— was only invented in 1990. It has been essential in understanding the human brain. In marketing, the brain assumed center stage in 2002 with the first neuromarketing experiments. These studies—which used tools like fMRI, but also EEG (electroencephalography, a method for measuring brain waves) and biometrics (tools such as face and fingerprint scanners)—examined the intersection of consumer behavior and neuroscience to determine how consumers may respond to an ad, brand or campaign. The purpose of neuromarketing is to figure out whether customers might pay attention to an ad, says Roger Dooley, author of Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing and owner of the Neuromarketing blog. If consumers pay attention, will they be affected emotionally? The answer can indicate buying intent, Dooley says. In a study published in the Journal of Legal, Ethical and Regulatory Issues, titled “Is Neuromarketing Ethical? Consumers Say Yes. Consumers Say No,”

the authors say that an ethical concern for neuromarketing is that it will give brands super-effective means to surreptitiously “push the buy button” in a customer’s mind. Marketing News spoke with Dooley—who has been writing about neuromarketing for more than a decade— about the ethics and capabilities of neuromarketing and whether it can “push the buy button.” This interview has been edited for length and clarity.

What are the ethical standards for neuromarketing research and the application of its findings?

Most companies providing neuromarketing services would say that they operate in an ethical way,

just as any advertising agency would. They’re not going to intentionally promote anything that’s deceptive or illegal. Most neuromarketing companies avoid testing kids under 18. They’re not trying to do neuromarketing studies on toddlers to figure out how to hook them onto their product; most people would find that pretty creepy. The question runs along all advertising: Are you doing things in a way that is honest and helpful to the consumer? Things that are not going to do harm? Are you helping the consumer decide to buy something they’re going to regret? If so, it doesn’t really matter what you’re doing, whether a marketing study or using deceptive ad copy—you shouldn’t do it. I’ve been reading about neuromarketing since about 2005 when there was a big concern that somehow brands were going to create these ads that would take over the customer’s brain and turn them into a buying drone. They’d be able to create ads that were so powerful that consumers would just do what they say. But that’s really a false concept. If those kinds of ads could be created, decades of work by Madison Avenue folks would have created at least a few of those ads by accident. The fact is that advertising has a limited impact. To me, it ends up being not a question of “Are you somehow using your marketing studies to create incredibly powerful ads?” but “Are you promoting a product or service that is good for the consumer?” And that’s not a neuromarketing question, that’s an advertising question.

A concern might be undue influence on a consumer’s decision, but that’s a debate between old-school economics and behavioral science as to whether the average consumer has a rational mind or not.

Well no, of course they’re not of rational mind. People do not make decisions based on totally rational criteria, even though most people will tell you that they do. Rational

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ETHICAL MARKETING

criteria certainly enter decision-making, but I’m not going to buy a $1 million Lamborghini for rational reasons. Certainly some decisions have rational elements or are almost completely rational. If you have to replace a broken part, there’s not much emotion involved. But for most consumer purchases— automobiles, health and beauty products, food, fragrances, beer—there’s a strong nonrational component. Brand associations are important because they’re emotional, even though people would tell you that they made those decisions because they liked the flavor of one versus the other.

Can neuromarketing deepen the emotional affinities consumers have for a product or brand?

Oh yeah, and advertising can strengthen that brand affinity and emotional attachment. Take a real classic like Apple’s “1984” ad: They created a stunning advertisement that was engaging, exciting to watch and a heroic moment. I’d say it made Mac owners feel more emotional about their attachment to the brand. And to that extent, a neuromarketing study might help you show that the “1984” ad was more engaging than the “Lemmings” ad that Apple ran the next year. If you’re talking about analyzing ads using your marketing techniques—for instance, a 30-second spot on TV—the big advantage to neuromarketing isn’t that you’re going to create these amazingly powerful ads, but hopefully you can get rid of some of the ads that suck. There are all kinds of studies that show that more than half of all the ads used by brands don’t move the needle. They don’t create brand preference at all. That’s the benefit neuromarketing offers to advertisers: You can identify those ads that simply don’t work and will annoy the viewer. Good neuromarketing studies can perhaps help an advertiser choose what works best or at least engages the consumers the most. They can eliminate

answers in action

the ads that are ineffective or destructively bad.

they don’t want to be identified or tracked.

In the scholarly article “Is Neuromarketing Ethical? Consumers Say Yes. Consumers Say No,” the authors mention that another top concern for neuromarketing is customer privacy. Have you seen any privacy issues in neuromarketing?

Traditionally, neuromarketing studies were not highly personalized. Taking a small group of consumers, testing them and then scaling up the results doesn’t really raise privacy issues. Now, with increased digital information and trackability, we have allowed more personalized approaches. I’ve seen some companies claim that they can ask a consumer a small number of questions and determine which quadrant of the Myers-Briggs Type Indicator they fall into, for example, which might dictate a different marketing approach. It’s hard for me to say how effective this is, but the possibility certainly exists. There are psychological factors being added to your digital profile along with all your other behaviors that are being aggregated. If you combine all this and target ads to people with specific characteristics, then that could be a good or a bad thing. It’s like if you are looking for a new suitcase, and as a result of your behavior, you start seeing suitcase ads everywhere. That could be good because it’s showing you other options than the ones you considered, or it could be really annoying and creepy if you already bought the thing. Personality-targeted ads could be the same way: You might find that you’re seeing better ads because, by and large, an untargeted ad from a consumer standpoint is the worst kind of ad. An untargeted ad is very likely to be meaningless. Maybe ads targeted to you based on your behavior or some personality characteristics would be a good thing. On the other hand, some people don’t want targeted ads because

It seems neuromarketing is a piece of the puzzle, but as you said, marketers and advertisers have to stand on a set of principles. Would marketers be wise to consider how they’d want their own data used as consumers?

Right. One area that is particularly sensitive is political marketing. People could see neuromarketing techniques as even more creepy when using them in politics versus selling detergent or beer.

Sure, and there’s more potential to use data to target different political groups so that only those groups see the ads— so-called dark advertising.

Right. And again, that’s not necessarily a bad thing in an abstract sense. If you have a product that’s going to appeal to a relatively limited number of people, then it’s great. You’re spending less on advertising and you’re not annoying the people who don’t care about your product. When you apply it to some sort of distasteful political subculture where you’re trying to aim only at a hate group, that gets to be undesirable.

How should marketers stay vigilant in using neuromarketing ethically?

Ask if the outcome is going to be good for the customer. Advertisers are always trying to make ads more effective—that’s been true since the first days of advertising. Neuromarketing is a tool for eliminating the worst ads, not necessarily creating ads that are going to drive consumers into doing things they don’t want to do. But you do have to get to a deeper question: Is the product or service you’re advertising good to the buyers you’re targeting? m

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scholarly insights

PROFITABILITY

More Market Share May Not Mean More Money BY ALEXANDER EDELING AND ALEXANDER HIMME

 edeling@wiso.uni-koeln.de  alexander.himme@the-klu.org

ormer General Electric CEO Jack Welch’s pronouncement, “Be No. 1 or No. 2 in every market, and fix, sell or close to get there,” quickly became a marketing mantra in 1983 and persists today. However, it is not universally accepted. While many CEOs still hold market share to be the most important indicator of corporate success, others disagree.

In today’s digital marketplace, small companies can manufacture in low-cost areas and sell to a global audience, competing effectively with category leaders. To examine the relationship between market share and financial profitability, we reviewed 89 studies published over 45 years to extract 863 data points involving the relationship between market share

and firm profits. We considered multiple theories to explain the market shareperformance relationship and created a framework to place these variables into three major groups: contextual characteristics, methodological characteristics and publication-related characteristics. In addition to being theoretically and practically plausible, variables had to occur in at least 5% of all elasticity observations to qualify for inclusion. In our study sample, firms were categorized as manufacturing, service or mixed product type and were analyzed against other variables including business type, market growth rate, market concentration, geography, recession period and time trend. Studies were selected for consideration

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PROFITABILITY

if they included an econometric regression model; provided a relative financial performance variable, such as the accounting-based ROI, ROE (return on equity) and ROS (return on sales) measures or financial marketbased variables such as Tobin’s q or stock return; and measured absolute or relative market share. Overall, we found that the market share-financial performance elasticity, or the degree to which each variable responds to changes in the other, is not what it is cracked up to be. Specifically, if market share increases by 1%, financial firm performance increases by an average of only 0.13% (with 45% of elasticities between 0-100 and 18% of the findings being negative). To put this number in context, other research has found that the average elasticities for key marketing assets such as customer relationships and brand are 0.72% and 0.33%, respectively. In other words, customer relationships deliver six times the impact of market share gains alone, and brands deliver nearly three times the impact. We found 27 factors that might influence this elasticity. Market share has more of an impact on financial performance of manufactured goods than services firms (difference in elasticities of 0.07%) or mixed product types (0.083%). This finding supports the argument that manufacturing leaders benefit from higher efficiency and market power. B-to-C firms experienced stronger elasticities than firms that serve both consumers and businesses (0.13%) and those that are only active in B-to-B (25%). This finding reflects the positive quality assessment theory and could be explained by the fact that consumers have lower price-sensitivity with a strong brand or that business buyers use more rational buying processes than consumers, such as bidding processes and buying centers. We found an inverted U-shaped relationship between mean market share within an industry and performance, indicating that elasticities are lower for markets with many niche players or few large players. This may be because niche

players forsake exclusivity for more market share, and large-share firms price aggressively to discourage challengers. We were surprised to find market growth rate did not rank as a moderating variable, potentially because other variables such as recession, time and region are controlled for in the study. Elasticities in emerging markets (0.15%) and Europe (0.15%) were more pronounced than in other markets, including the U.S. This may be because the U.S. is a highly mature, competitive market, and market share increases are only achievable at the expense of product losses. The impact of recessions on elasticities depends on context. Large-share firms benefit from efficiency and market power mechanisms that provide a buffer during recessions. However, when B-to-B and B-to-C firms are considered together, the effect reverses, potentially because consumers may be willing to buy less costly goods and market-share leaders may be less flexible in responding to changing trends and threats. In conclusion, while the market share-financial performance elasticity is positive, it is substantially lower than average elasticities for brandrelated and customer-related marketing assets. Together, these results imply that marketing budgets should be allocated as such: 61% to building customer-related assets, 28% to building brand-related assets and 11% to increasing market share. If forced to make a trade-off, our results would suggest that marketing teams should focus on building marketing assets, not boosting market share. These slow and steady investments in expanding products, enhancing customer service and building brand with a high-potential target customer base is the best path forward to grow and future-proof a business. m

Marketing budgets should be allocated as such: 61% to building customer-related assets, 28% to building brandrelated assets and 11% to increasing market share.

ALEXANDER EDELING is an assistant professor of marketing at the University of Cologne. ALEXANDER HIMME is an associate professor of management accounting at Kühne Logistics University.

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executive insights

STORYTELLING

4 Pitfalls of Storytelling and How to Avoid Them

communicate who you are—break through distractions and disinterest to change perceptions, inspire and generate memories. Hundreds of studies have shown that stories are two to three times more effective at conveying a message than reciting facts. What is stopping organizations from making stories the cornerstone of their communications?

Impact Stories Cannot Be Found Even when brands commit to elevating stories in the communication mix, it’s hard to come up with truly powerful stories. There is no checklist of effective story characteristics, but effective stories are built on interesting, empathetic and authentic people who are facing some kind of challenge that involves uncertainty, tension and, ideally, a surprise ending. Look for a plotline that is so entertaining, informative or awe-inspiring that the audience will feel compelled to pass it along. Brands with utilitarian offerings must develop higher-purpose programs to feed their stories. Soap brand Lifebuoy developed three stories of how its handwashing program helped children survive in three Indian villages. Video stories documenting the effort garnered 44 million views.

BY DAVID AAKER

 daaker@prophet.com

uring a volunteer session at San Francisco-based nonprofit St. Anthony’s Dining Room, I heard many facts, but also a story that I’ve repeated dozens of times: A client left his engineering job to care for his wife, who had cancer. Their insurance ran out, and by the time she died six years later, he had sold his home, depleted all his savings and seen his engineering skills wither. He needed St. Anthony’s. It could happen to anyone. The statistics faded quickly, but the story stayed with me. In this digital age, brand perceptions and relationships affect how customers, employees, partners and others evaluate their options when making a purchase, applying for a job or collaborating. It is critical for brands to communicate not only their offerings but also the purpose and heart of the organization. This task is made difficult by limited budgets, a glut of content and audiences that are disinterested and skeptical. Signature stories—authentic narratives that intrigue, involve and

Don’t Believe and Don’t Commit Getting organizations to believe in and commit to storytelling is a huge barrier to using stories. Many businesses make the comfortable and convenient assumption that their audience is logical and believes, as they do, that knowing facts about the brand’s offerings is both useful and worthwhile. That is rarely the case. More likely, the audience will ignore such messaging, and if it gets through, they will usually forget or distort it.

Many businesses make the comfortable and convenient assumption that their audience is logical and believes, as they do, that knowing facts about the brand’s offerings is both useful and worthwhile. That is rarely the case.

Weak Presentation Even strong stories can be rendered ineffective if poorly presented. Don’t rely on a customer or employees without professional experience to create a story. A story that is badly edited, confusing, incongruous or unpleasant to the eye will be difficult to amplify. A frequent error of storytelling is a lack of specific examples or details. Detail that makes the story vivid and intriguing will draw people in. Knowing the personality and motivations of a character can help the audience empathize and understand the challenges he or she faced. Be intriguing at the outset. The story should grab the audience’s attention with the opening line or moment. Consider a story that begins, “It was a drab and rainy day in mid-May 1931 when the 28-year-old Neil McElroy, the advertising manager of P&G’s Camay soap, sat down at his Royal typewriter and wrote perhaps the most significant memo in modern marketing history.” What did the memo say? Why was it important? Who is this guy? What happened to him? You notice. You read on. You remember.

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Mismanaged Story Program Some storytelling programs are mismanaged. One indication of mismanagement is a lack of support staff to find, curate and refine the stories. One of the best users of stories, UC Health, has a team of seven people to support its story program. The team finds stories by hanging out with doctors and the story stars (patients at UC Health) before they create presentations. A huge problem, especially for firms

that have avoided the first three pitfalls, is story overload. There is a tipping point after which there are too many stories for employees to manage or for customers to grasp. Organize your stories by message and prioritize stories by their level of influence. Stories can also be combined into meta stories. Molson Beer’s master story about creating a hockey rink in the Purcell Mountains for people who would do “anything for hockey” was surrounded by stories of the building

executive insights

challenges, the people selected to play and the final game. Signature stories can transform wasteful, ineffective communication programs, but organizations must overcome these four pitfalls to fully take advantage of them. m DAVID AAKER is vice chairman of Prophet, the author of Aaker on Branding and a member of the Marketing Hall of Fame.

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executive insights

BRANDING

Nike and the Arrogance of Moral Certainty Social impact is not a strategy; it’s a responsibility. It’s a moral imperative, not a marketing plan.

BY RUSS KLEIN

 rklein@ama.org

hould my words fail me, I want to first establish that I am against police brutality, racism, bigotry and intolerance in absolute and unconditional terms. What follows is not a political statement on my behalf or on behalf of the American Marketing Association. Rather, I aim to point out the wrong-

headedness of Nike’s marketing decision to feature Colin Kaepernick as its moral paragon in celebration of the 30th anniversary of its epic brand declaration, “Just Do It.” I am not opposed to anyone’s right to expression whenever and wherever they choose. My question, or challenge, is what responsibility comes along with that

right? Further, what judgement comes along with that right? Critical social and societal issues such as police brutality and racism warrant the full attention of our citizenry until they are extinguished from the planet. Period. Are there any forums in which these serious issues are unwanted? Should a brand “on a mission” care? For many brands today, the blurry line between purpose and profit presents a knotty management issue. Allow me to share my own perspective. There are few more ardent fans of the Nike brand than I. I’ve spent countless hours deconstructing the magical elixir constituting the Nike brand. I could never get enough of it as a marketing professional or an avid runner, and it has served as a source of inspiration for my own career in marketing — earning me the nickname “flamethrower” in one industry publication. Like Nike, I agree there are times when

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it is more important to be provocative than pleasant. However, from a marketing point of view, it is my counsel to brand owners that it is unnecessarily dangerous, commercially or morally, to drape a politically incendiary cape around your brand and delude yourself into thinking it makes you a superhero. Declaring “you’re for me or against me” on an issue for which there are legitimate and differing perspectives is both ignorant and arrogant. “Just Do It” was once a universal appeal to the primordial human need to move. It was and, for the time being, still is a big, simple and inclusive idea packed with layers and layers of psycho-strata. It was a declaration that no matter who you are, there’s a better you inside you if only you decide to “do it,” too. It is articulated with utter economy: three small words strung together with tugboat pulling power. It is a karatechop call to action and a symbol of pony express-like determination. Neither snow nor rain nor heat nor gloom of night stayed those couriers from the swift completion of their appointed rounds. Just like the resolute U.S. Postal creed, Nike exhorts to us all that there are no excuses; not fear, not bad luck, not superstition, not the opponent, not the referee, not the weather or any other interference of any kind can defeat a rage and exhilaration to move. It is essentially “A to B;” it deserves an emphatic “dammit” as punctuation. I will concede the Kaepernick move is provocative and highly viral. But what it did was divide Nike’s near universal brand appeal into something smaller. Not just because of the obvious math, but because of the arrogance of it. No doubt, Nike’s customer data showed that its core sneaker-buying audience was sympathetic to this message, and perhaps the company felt it could ignore the demographic groups that disapproved of it. Nonetheless, with this move, Nike took away a connection that millions want to make with a brand they once felt understood them. It turns out Nike no longer seeks to understand, it thinks it knows better.

executive insights

My thinking on this is not new. I wrote about this notion several months ago. Not every brand can stand for political, social or environmental issues. A dedication to making the customer’s life easier need not be driven by some ennobling societal vision, just an honest passion to make life easier or better. J. Walker Smith makes a compelling case as to the important distinction between purpose and politics in the Marketing News June edition in an article titled, “Brands with Purpose. Not Politics.” Now, there are certainly times and circumstances when brand owners are obliged to disassociate and distance themselves from those who have hijacked their brand in the name of morally reprehensible intentions, such as were on display in Charlottesville, Virginia. But I would generally advise against positioning a brand around issues where there are otherwise legitimate and divergent points of view. The opportunity to grow a brand is maximized when bringing many different-minded people together who can be satisfied by a powerful and unifying solution for something in their lives. Please don’t mistake my views to say a firm doesn’t need a moral center or duty to comport themselves according to universal values of decency. Social impact is not a strategy; it’s a responsibility. It’s a moral imperative, not a marketing plan. Solving a relevant problem or inventing a new source of enjoyment or comfort is purposeful; and yes, just being useful ought to be religion enough. Nike is for the athlete. Athletes are not a monolithic group. They are as diverse in political and social issues as is the body politic. A disposition or way of thinking to prefer that politics are kept separate and discreet from sports or entertainment is not the moral equivalent of racism, so please don’t ascribe illicit or ulterior motives to my purpose in speaking marketing truth on this issue. Ultimately, the free market will decide if our once coveted autumn Sunday and

From a marketing point of view, it is unnecessarily dangerous, commercially or morally, to drape a politically incendiary cape around your brand and delude yourself into thinking it makes you a superhero.

Monday night ritual now comes with a moral chalk talk. Agree or disagree, but please don’t get personal. Civility is not a sign of weakness. m As CEO for the American Marketing Association, RUSS KLEIN is charged with the transformation of the AMA to become an essential community for marketers. Klein is a five-time award winning CMO who has quarterbacked teams for many of the world’s foremost brand names—holding top marketing and advertising posts at Dr Pepper/7UP Companies, Gatorade, 7-Eleven Corporation, Arby’s Restaurant Group and Burger King where he also served as president from 2003-2010.

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4 UNDER 40 EMERGING

LEADERS BY SARAH STEIMER

he marketing profession is stacked with impressive résumés and experience from fresh-faced entrepreneurs, high-powered CMOs and everyone in between. The AMA’s 4 Under 40 Emerging Leaders Award recognizes mid-career professionals with impressive experience under their belts, who still have many years ahead of them in their field. The 2018 winners were chosen by a committee that included representatives from the AMA’s advisory councils and the Marketing Week Live conference committee. Winners consistently demonstrate a commitment to their industries, contribute to the advancement of marketing, serve as passionate leaders, provide mentorship and take risks to achieve desired outcomes. Of this year’s 67 nominees, the committee chose four outstanding emerging leaders: Andrew Malcolm, Liliana Ciurlino, Chris Smith and Bobby Singh.

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4 40

UNDER EMERGING

LEADERS

ANDREW MALCOLM CMO EVERNOTE

ndrew Malcolm appears perfectly at home on his trip to Chicago. He’s quick to chat about his two children and their many trips to the Shedd Aquarium, and he jokes about his penchant for free T-shirts and “South Park” references. It’s almost impossible to picture him in Silicon Valley, where he works as CMO of note-taking software company Evernote. He is the antithesis of California-slick, and his self-awareness may be what keeps him grounded in the land of Facebook and Google. “We’ve talked for years about whether we should just move back (to the Midwest) because there’s no way I don’t feel a little bit out of place in Silicon Valley,” Malcolm says of conversations with his wife. “If you look at our résumés, a lot of it looks very Silicon Valley, but within a five-minute conversation we try so hard to break down that perception of who we are.” While he maintains a Middle America vibe, Malcolm’s career story reads as pure West Coast success. After some stints on the East Coast and Texas, he moved to California about 15 years ago with the intention of consulting for a few years before becoming a “golf bum.” Once he realized a golf career was hardly in the cards for him, he enrolled in business school at Stanford University. At the start of the Great Recession, Malcolm worked at private equity fund Silver Lake Partners. He remembers spinning in his chair, wondering if he would still have a job as the economy took its own turn. A new opportunity soon arrived in 2009: Malcolm’s firm, along with Andreessen Horowitz and the Canada Pension Plan Investment Board, acquired 65% of Skype from eBay—Malcolm hopped aboard the

telecommunications company. Skype’s CMO was let go and, as Malcolm tells it, company management believed the business could be sold again and didn’t want to pay a seasoned executive. Instead, they hired him as CMO. He was 28 years old and had never managed more than six people. “Next thing I know, I had a team of 80 people,” Malcolm recalls. “I’ll never forget the fear that first day of speaking to all these people and saying, ‘I believe in the team, and I’m going to be quite transparent. I don’t know much about this stuff, but we’re going to figure it out together.’” He admits that he wasn’t the greatest leader, at least not at first. Two of his coworkers had to approach him about his habit of not taking notes during meetings. But one of the pros of his lack of experience as a marketer was being unburdened by traditional practices. “We had little choice but to simply apply logic to the problems we were facing,” Malcolm says. “If we could marry this deeply analytical thinking that comes with being a nerdy data guy from a private equity background with the things that [Skype] was incredible at— storytelling and putting systems in place that work at scale—then we could build a creatively analytic approach.” The first year was tough, Malcom says. Many employees were reticent and skeptical of him. But then his team started succeeding. One of his team’s first wins was communicating the platform’s use for long-distance calls. The challenge was to market the service without using the phrase “phone call” because Skype isn’t a regulated telephone company. Malcolm’s team used an image of a dial pad to convey the program’s capabilities,

and subsequently, the lifetime value and expected value of Skype users increased 11% during users’ first three days on the platform. After that, Malcom says the rest of the team looked at marketing differently; they were “growth hacking” before it became a popular term. Malcolm spent more than four years at Skype before heading to HP for two years. He then reached out to Chris O’Neill, whom he had worked for in 2002 and who had recently replaced Phil Libin as CEO of Evernote. “I called him and said, ‘Without seeing a line of code or a metric of your business, I can probably tell you the nine things you have to fix because they’re the exact problems that Skype had’,” Malcolm says. “I was right on maybe six and a half of those things.” O’Neill hired Malcolm as senior vice president for marketing. Around the same time Business Insider deemed Evernote the “first dead unicorn,” adding, “The seeds for its long-term demise are already well under way.” Evernote had about 12 months’ worth of cash left, some illogically placed global office locations and no successful pricing mechanism. Malcolm had to make some creative—and uncomfortable—decisions. The Evernote team used behavior data to design a paywall. They found that adoption across multiple devices was one of the best indicators of customer interest in paying for service in the future. The model the team created asked users to pay if they synced more than two devices to Evernote. The decision saved the company, but there were still some longterm employees who felt the move went against Evernote’s mission. Malcolm says that one of his biggest regrets was not using his personal Evernote story to better

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FAST FACTS ABOUT ANDREW AGE: 38 AVERAGE NUMBER OF HOURS YOU WORK PER WEEK: 60 WHOM WOULD YOU MOST LIKE TO COLLABORATE WITH: The projects I love the most are telling the stories of what people do with Evernote. These humbling moments remind me that what Evernote does is cool, but what people do with Evernote changes the world. MOST USEFUL BOOK YOU’VE READ AS A MARKETER: I believe we are business leaders first and marketers second, so I have to say Band of Brothers by Stephen Ambrose. Every time I read this book, I am reminded never to underestimate the power of a team with a common mission. BRAND YOU LOVE: Melissa & Doug (#WorkingDad)—not just because my kids love it, but also because it stands for the power of play. Play is an unbelievably important aspect throughout our lives that we all need to be our best.

convey why he cared so much about saving the company. He created his first note on his birthday in 2011. Later, when his father had a stroke, Malcolm kept his father’s medical records on Evernote, and later his legal documents after he passed away. He even wrote his father’s eulogy on the platform, where he also stores his children’s sonograms and letters he wrote to them. “I had this relationship with Evernote that I don’t think a lot of brands can sustain. It’s both professional and very personal,” he says. “Making sure that story lives on is the most important thing we can do for our users.”

Evernote spent only $3,600 on media in 2017, allowing personal anecdotes to tell the brand story. Malcolm now tells his story at new-employee meetings, and he talks about how the team has to honor what they’ve been entrusted with. As for the future, Malcolm is content in the software industry. He’s excited to start working each morning—which, for him, begins at 3:30 a.m. for “uninterrupted thinking time.” He insists this schedule gives him a minimum six hours of sleep if he keeps the same 8:45 p.m. bedtime as his kids. At least until the Midwest pulls him back, he’ll keep working at West Coast software businesses. m

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UNDER EMERGING

LEADERS

LILIANA CIURLINO PRIVACY AND SECURITY COMMUNICATIONS MANAGER LOANDEPOT

iliana Ciurlino says that she has been learning to play piano for about 10 years. Most people would use the term “playing,” not “learning,” after the first few years, but Ciurlino insists on being a perpetual student. As we chat over the phone on her drive to work (one and a half hours between her home in San Diego and loanDepot’s Orange County, California, office), she emphasizes her love of learning. On top of her lengthy commute, full-time job and hobbies, she’s also finishing her MBA at Missouri State University and hinted at eventually getting her Ph.D. Ciurlino doesn’t slow down. Rather, the process of moving forward seems to be a core part of her problem-solving process. Watching her answer questions in person, you can almost see her thoughts forming as she weighs her options, reacts and revises. “I bring tons of ideas,” she says. “Use them, keep them, discard them—I’ll have more tomorrow. It’s wired in me.” Ciurlino’s career began in the arts. She taught and choreographed in professional dance companies in San Diego before deciding to start a nonprofit called contACT ARTS. “I remember calling the IRS. I didn’t know what I was doing,” she says. “Back then it was $500 to set up a nonprofit. I wasn’t a businesswoman, I just wanted to dance and be with my friends. I was learning how to grow this nonprofit by my mistakes and by my experiences.” This was Ciurlino’s introduction to marketing: Taking fliers to coffee shops, making a MySpace page, creating social media accounts as platforms became available and exploring digital marketing and editing tools. “As I was growing, so was the world of marketing and the technology behind it, enabling me to start

exploring and building this company,” she says. The experience pushed her toward marketing; she earned a business degree from the University of Phoenix with a marketing concentration. While her music and dance background might suggest she’s predominantly interested in the creative side of marketing, she’s also fallen in love with data-crunching. She worked as a marketing manager at a structured settlement company, followed by the same role—in a regional capacity—at H&R Block. She then took on technology and marketing engagement at Managed Solution, a B-to-B brand management firm. There she founded Tech Spotlight Magazine and served as its executive editor, interviewing tech giants such as Vint Cerf, who is recognized as one of “the fathers of the internet,” and Martin Cooper, who is considered the inventor of the first handheld mobile phone. “I’m a sponge,” Ciurlino says. “I want to learn from everyone and meet incredible, talented people.” One of her interviewees at Tech Spotlight was a magnet to her sponge, inviting her to come work for him at loanDepot, an emerging-growth nonbank consumer lender. There, Ciurlino works as the security communications manager, sitting in a sea of IT professionals. Unlike her previous roles, where she did external marketing for new-client growth and worked with sales teams, her work focuses on internal marketing at loanDepot, helping the company become more privacy- and security-aware. She takes technical-heavy concepts and jargon and simplifies them for the company’s 7,000 employees. As with contACT ARTS, Ciurlino is

interested in more than just the final production—she wants to be involved behind the curtain. “I like the entire strategy from conception to execution,” she says. While her career is technical, her personal life remains as creative as ever. Ciurlino plays piano and writes music on the side and says her hobbies influence her career—in the future they might overlap. “I keep joking that one day I’m going to write jingles,” she laughs. m

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FAST FACTS ABOUT LILIANA AGE: 39 AVERAGE NUMBER OF HOURS YOU WORK PER WEEK: I’m always working. I sleep about five or six hours per night. Eight is my goal but rarely achieved. My last CEO gave me advice on my exit interview to go enjoy life more and not work so much. I’m still working on that good old work-life balance thing just like everybody else. WHOM WOULD YOU MOST LIKE TO COLLABORATE WITH: I had the honor of spending some quality time with leadership coach and author Marshall Goldsmith at his home a few times this year. His book Triggers was helpful when I started this new role, as I was considering my approach to changing employee culture. I would love to be able to collaborate with him on a future book. He’s a legend. MOST USEFUL BOOK YOU’VE READ AS A MARKETER: I love Simon Sinek’s Start With Why. He talks about how it’s not what companies do that distinguish them, but why they do it. BRAND YOU LOVE: I admire so many brands for their marketing. Chipotle aired a great animated video set to Willie Nelson’s version of Coldplay’s “Back to the Start” at the Grammy Awards in 2012. It was the first time I’d seen a fast food company play on the heartstrings of viewers and keep them engaged for several minutes. I’m also in awe of Patron Tequila’s marketing.

Ciurlino doesn’t slow down. Rather, the process of moving forward seems to be a core part of her problem-solving process. Watching her answer questions in person, you can almost see her thoughts forming as she weighs her options, reacts and revises.

It’s a terrible tequila product that had terrific marketing by targeting nightclubs and young consumers. I’m a huge Microsoft fan. I could tell you amazing things about the productivity of integrated applications with Office 365. Mind you, I was a Microsoft facilitator, so I’m biased. Microsoft has been slaying with their partner network emphasis. Any brand that focuses on a humanized targeted approach is doing something right.

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LEADERS

CHRIS SMITH CO-FOUNDER CURAYTOR

f a LinkedIn profile could come to life, it would be Chris Smith. The co-founder of digital marketing and sales platform Curaytor, he knows precisely what makes him professionally valuable, and he has two books, a podcast and a carefully crafted social presence to back it up. His signature red Jordans and self-certainty suggest that he’s spent some time polishing his image. When asked to describe his personal brand, he took a few takes that were reminiscent of a copywriter perfecting a tagline. “My brand is confident and relatable— and I’m an expert. I’m an expert that’s confident, yet relatable, and I think I’m edgy, sadly, in the business world,” Smith says, referring to his penchant for wearing sneakers onstage or drinking a beer while filming. The effort to relay the perfect definition of his brand comes from knowing that his clients and audiences aren’t just buying what he’s selling, they’re buying him. It’s this awareness that led him to start his own company, Curaytor. “Your audience is your equity, and that’s the one thing that big companies I worked for didn’t quite understand,” Smith says. “They didn’t realize that I was the brand. As soon as I went out on my own, because I had grown my personal brand while I was working in corporate America, I had gigs right away.” Smith’s early entrepreneurial ventures were youthful hustles: buying Blow Pops in bulk to resell individually at school and making cassette tapes from CDs to sell to classmates. His entrepreneurial spirit took him to business school at Florida State University, but he failed out before correcting course and graduating with a degree in sociology. He credits his deftness with social media to this change

of major. “I think [sociology] taught me a lot about people and the way the world works, probably more than a business degree would have,” Smith says. After a stint in Los Angeles, where he dipped a toe into the entertainment industry, Smith returned to Florida. He worked in sales but faced a tough customer base: No one wanted to hear his sales pitches, they only wanted instruction. “Anyone could come in and do a class on Facebook or Twitter,” he says, so Smith repackaged his pitch for his audience. He also presented his marketing know-how in the form of a website called Tech Savvy Agent and trained real estate agents on using social media. At Curaytor, a real estate digital marketing and sales platform, Smith touts his team of millennials, insisting they— and his own two children—keep his digital knowledge fresh. In addition to starting his own company, Smith published The Conversion Code in 2016 and co-authored 2014’s #Peoplework with Dotloop CEO Austin Allison. He also hosts the podcast “Calls with Chris.” One of the biggest payoffs to teaching others, he says, has been the social currency: the gratitude from and interaction with others. Calling himself a typical Leo, he says that vanity metrics are important to him, they prove that people are really tuned into his work and are sharing his insights. A quick scroll through Smith’s social media accounts emphasizes how certain he is about his brand: It’s Smith in T-shirts and blazers, clips from his presentations and inspirational quotes (often his own), and it’s all tied together with Curaytor’s signature red. In fact, his accounts could pass for those of an ESPN show, which makes sense when you learn Smith once

dreamed of being a basketball player. “My earliest memories are sports and entertainment,” he says. “For whatever reason I never gave up that belief. When I got into sales and marketing, I still wanted to be famous, be an athlete, win an Oscar. But what’s the business version?” m

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FAST FACTS ABOUT CHRIS AGE: 40

[Editor’s Note: Smith was 39 at the time of nomination and selection.]

AVERAGE NUMBER OF HOURS YOU WORK PER WEEK: 42.5 WHOM WOULD YOU MOST LIKE TO COLLABORATE WITH: Jason Fried from Basecamp MOST USEFUL BOOK YOU’VE READ AS A MARKETER: The Giving Tree by Shel Silverstein BRAND YOU LOVE: Jordan Brand

One of the biggest payoffs to teaching others, he says, has been the social currency: the gratitude from and interaction with others.

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BOBBY SINGH SENIOR VICE PRESIDENT AND HEAD OF DIGITAL BET NETWORKS

obby Singh looked perfectly at home in the “Mad Men” room at the AMA support center. He wore a stylish three-piece suit that could have given Roger Sterling a run for his money—but he hardly has time for the long, tipsy lunches the fictional Sterling indulged in. Even Singh’s brief trip to Chicago for the 4 Under 40 photo shoot was filled with meetings at BET’s satellite offices, and he ducked away between photos and video to tackle e-mails. To say he has a busy schedule would be an understatement, but he presents nothing but stylish ease—his days coordinated as well as his clothing. Marketing comes naturally to Singh. It may even be hereditary. His father ran a radio show as a hobby, and Singh would join him at meetings to sell ad space to vendors in Southeast Michigan. He and his siblings, who are first-generation Indian-Americans, also helped in the family store. Like their father, the Singh kids had both an entrepreneurial streak and a love for music: The siblings started Hype Productions as a way of connecting to their culture, and the company hosted South Asian dance events such as the Bhangra Fusion competitions, which ran for about a decade in the early 2000s. (During the same time, Singh also performed as DJ Divine—but proof of this wasn’t easy to track down, despite earnest efforts.) After graduating from the University of Michigan, Singh’s career took a decidedly nonentertainment turn. He moved to Minneapolis to work in operations and analytics for Marshall Field’s, followed by a stint back in Michigan to work in supply chain finance for Kmart before landing in financial planning and analysis at Limited Brands in Columbus, Ohio.

“I found myself pigeonholed in this industry and this function,” Singh says. “I was in the retail industry and specifically in a function of financial planning and analysis. I just wanted to broaden my options.” Broaden he did: Singh enrolled at Columbia Business School, taking him to New York, where he still lives. MBA in hand, Singh worked for Boston Consulting Group before launching his own business called KashPile, a money management and shopping site that teaches kids how to earn, save and spend responsibly. In 2013, Singh joined iHeartMedia as director, then senior director, of strategic initiatives. He worked to get on digital projects while at iHeartMedia, but the company wanted to focus on terrestrial radio. When Viacom came knocking with a role at BET Networks, Singh was ready to listen. He joined the entertainment company in 2015 as vice president of digital strategy, operations and business intelligence before being promoted in 2017 to senior vice president and head of digital. Singh will graciously answer personal questions, but he’s noticeably passionate when discussing the nitty-gritty of his job. He says the success of his digital work at BET is based primarily on his own use of and curiosity about social platforms. “BET needs to cater to these audiences in a very platform-, occasion- and deviceintentional manner,” Singh says. “It’s not sufficient to try to get everyone to go to our owned and operated sites and apps. There’s too much other content out there for us to not be natively serving our audiences on third-party platforms to generate a relationship with them.” Before Singh joined BET, the network largely ignored third-party social

platforms. For example, the company didn’t program any original content on YouTube and published barely any video clips prior to 2015. BET’s channel had about 150,000 subscribers when he started and has since grown to 700,000. “I plan on tripling that growth over the next year,” Singh says. In addition to his role at BET, Singh volunteers as an ambassador for Columbia Business School, mentors on digital media for Harvard Business School’s Startup Studio and serves as an

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FAST FACTS ABOUT BOBBY AGE: 38 AVERAGE NUMBER OF HOURS YOU WORK PER WEEK: 70 WHOM WOULD YOU MOST LIKE TO COLLABORATE WITH: Will Smith. He’s done an incredible job building a digital audience across key platforms like Instagram and YouTube. I’d love for my team to collaborate with him on a project. MOST USEFUL BOOK YOU’VE READ AS A MARKETER: Most relevant for my current role was Social TV: How Marketers Can Reach and Engage Audiences by Connecting Television to the Web, Social Media, and Mobile by Mike Proulx and Stacey Shepatin BRAND YOU LOVE: John Varvatos

associate member of the International Academy of Digital Arts and Sciences, through which he judges the Webby Awards. In the future, Singh says he might consider teaching, not only because he has something valuable to share with others, but because it offers him an opportunity to learn as well. “I prefer speaking engagements where there can be a conversation, where I’m learning at the same time as presenting my views and thoughts,” he says. In an ideal world, Singh says that he would just drop in on

business classes any time he felt the urge. As scheduled as his days are, Singh appears drawn to the less-structured opportunities to learn and muse— evidenced by his willingness to chat off-topic over breakfast about HBO’s “The Defiant Ones” or listen to a story about celebrity tattoo artists in New York. He makes the time for those unscheduled moments, and you have to wonder if his strength while DJing years ago in Michigan may have been improvising between sets. m

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How to Solve a Problem

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FINDING AND DEFINING PROBLEMS T

hree days after graduating high school, Fred Nickols joined the U.S. Navy and began solving problems. He learned a technique called fault isolation that let him find and fix problems with radars, computers and weaponry. During one gunfire support mission, he found that a gun was shooting bullets 300 yards beyond where the military thought capable—Nickols wrote up the problem and the weapons system was modified to show its more accurate, longer range. “That was a nice beneficial side effect,” he says with a chuckle. After leaving the Navy, Nickols worked for 40 years as an executive and business consultant and found that business problems could be grouped into the same three categories as they were in the Navy. There are find-and-fix problems, like the gun that shot too far. These problems are easily definable and have definite solutions. There are problems where businesses simply want to improve. “Nothing’s broke, but you want much better than what you have,” Nickols says. Then there are the problems where businesses have a void to fill and must create something new. “You’re starting from scratch,” he says. “You don’t have anything in place, but you’ve got to put something in place to create the results you want. “You’ve got to decide up front: Are you trying to find something and fix it, are you trying to improve what you have or are you building something from scratch?” Nickols says. A caveat to finding and defining problems is the distinct difference between problems that have a single solution and those that don’t, according to M. Neil Browne, a professor at Bowling Green State University’s College of Business and co-author of Asking the Right Questions. Single-solution problems—“efficiency questions,” Browne calls them—will have one answer that is clearly better than the rest. If shipping products has become too expensive, for example, there’s likely one answer that works best to reduce costs. But in more complex problems— “critical thinking problems,” Browne says—the best answer depends on perspective. “If a firm is having difficulty and the marketing

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director says, ‘You should spend more money providing incentives to our sales staff,’ but one of the production engineers says, ‘You could save more money by spending more on automated equipment,’ that’s not going to be something that every reasonable person in the room is going to agree with,” Browne says, “because their assumptions are different.” Consider critical-thinking problems this way: Your back hurts, so you make appointments with an exercise physiologist, an orthopedic surgeon and a holistic health guru. Each will use knowledge of their specialty to give you a different solution for your back pain. They could debate for hours without reaching a single conclusion. As psychologist Abraham Maslow quipped in 1966: “I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.” This initial stage of problem-solving— defining the problem—is where most businesses stumble, says Andrea Bassi, founder and CEO of KnowlEdge Srl, associate professor of system dynamics modelling at Stellenbosch University and co-author of Tackling Complexity. There are many ways companies can misidentify problems, but Bassi says that their biggest mistake often occurs when they define a problem by its symptoms instead of its causes, main effects

and true drivers. Addressing the symptoms can help eliminate short-term issues, Bassi says, but it likely won’t solve the long-standing problems and could create more. Most problems emerge from within organizations rather than originating from the outside, Bassi says. “We tend to think that things are imposed onto us, and we need to find solutions, but in fact, we’re normally creating problems with our behavior,” he says. “If you use a systemic approach, you can figure out more lasting and more effective solutions.” But before moving into a systemic approach, it’s important to go beyond the surface of what the problem could be and find out exactly what it is. In this stage, Nickols says that companies must avoid locking in on one solution by asking many questions: What functions do you want to be able to perform, and who must be able to perform them? What kind of data structure do you want in the system? “Over time, the picture of the system that you’re building will begin to emerge and finally crystallize,” Nickols says. But the questions should never stop, even if the problem crystalizes. Questions, according to Browne, are likely the most important part of the next step: Creating the team that will solve the problem.

Most problems emerge from within organizations rather than originating from the outside. We tend to think that things are imposed onto us, and we need to find solutions, but in fact, we’re normally creating problems with our behavior.

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BUILDING THE PROBLEM-SOLVING TEAM I

n 2009, nonprofit Prize4Life posted a problem to InnoCentive, an open-innovation and crowdsourcing platform. Prize4Life wanted to find the biomarker for Amyotrophic Lateral Sclerosis (ALS), a degenerative disease that seemingly comes out of nowhere. Prize4Life offered problem-solvers $1 million to find the ALS biomarker; within two years, Dr. Seward Rutkove of Beth Israel Deaconess Medical Center in Boston found it. Six years later, Prize4Life used the pool of more than 1,000 problem-solvers on InnoCentive to find ways to predict disease progression in ALS patients, awarding problem-solvers smaller cash prizes. InnoCentiveâ&#x20AC;&#x2122;s crowdsourcing system brings in problem-solvers from outside the organization,

granting access to the eyes, brains and problemsolving abilities of people who may have never worked in medical research. Jon Fredrickson, chief innovation officer at InnoCentive, says that using outsiders allows companies to look at a problem differently than they would by assembling a team from inside. But what if a company has access only to its own employees? Companies should form a problem-solving team where each member brings a different perspective, writes Antonio E. Weiss in his book Key Business Solutions: Essential ProblemSolving Tools and Techniques That Every Manager Needs to Know. Each team member must feel comfortable giving feedback to one

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another: “Feedback is just as much about giving constructive praise as constructive criticism,” he writes. “And feedback can be given by any team member, no matter how junior or inexperienced.” Weiss writes that all team stakeholders need to understand what the problem is, what a good solution looks like, when the solution needs to be delivered and the context surrounding the problem. Glenn Llopis, a business management consultant and author of The Innovation Mentality: Six Strategies to Disrupt the Status Quo and Reinvent the Way We Work, says that cultivating an environment where feedback is acceptable takes something organizations often lack: vulnerability. “Very few people have all the answers, so you have to be able to create an environment of vulnerability and inclusivity within your organization for people to provide constant feedback and recommendations, regardless of hierarchy or rank,” Llopis says. “There are so many opportunities that are ignored because the individual doesn’t feel comfortable revealing them.” Beyond stifling feedback, companies often involve too many high-level employees and not enough employees who deal with the problem’s issues every day, Bossi says. “They may not have enough knowledge of what’s going on,” he says of high-level personnel. “They miss what could be the root causes of a problem in the production chain. They may miss some of the considerations that actually drive them to find a lasting solution.” To avoid missing insights, Bossi says that organizations should find a mix of knowledge from technical and managerial points of view. “You need someone with the vision of the higher level in a management position and those that work more on the technical level and see how the work is performed on the ground,” he says. Nickols, the Navy serviceman who went on to solve problems his entire career, says that he has a few basic principles for forming a problemsolving team. First, there must be someone in a position of authority. In addition, he agrees with Bossi: There must be people who know the system well. “I don’t want newbies and trainees,” he says. “I want people who have the respect of their peers.” Nickols says that the team also needs a sponsor, someone who will give the project authority and support behind the scenes

and get all departments to buy into the team’s work. Finally, he suggests adding a “straw boss,” someone who ensures the team has everything it needs. In the book The Moment of Clarity: Using the Human Sciences to Solve Your Toughest Business Problems, authors Christian Madsbjerg and Mikkel B. Rasmussen suggest that businesses frame problems in a way that allows employees to be curious. “Reframe the problem as a phenomenon,” the authors write. “If your team can create a shared understanding of the problem and agree on what you and the rest of the team don’t know, it is much easier to accept new ways of solving the problem.” In Brian Tracy’s book Creativity & Problem Solving, he suggests that teams hold both “mindstorming” and brainstorming sessions. In mindstorming sessions, each team member takes a sheet of paper with the problem or goal at the top, then writes 20 answers using the first-person voice and action verbs. The question, “What can we do to double our sales and profitability in the next 24 months?” could be answered with ideas like, “We hire and train 22 new sales people.” In brainstorming sessions, Tracy widens the scope by including four to seven team members and having them generate ideas together for 30 minutes, staying positive and saving the criticism of ideas for after the meeting. Throughout the problem-solving process, Browne says, teams—especially those working on critical-thinking problems—should focus on a series of evidence-focused questions, such as “Do you have any financial interest in the answer to this question?” and “How much experience do you have in using this evidence?” Although many people may find this kind of critical thinking aggressive, Browne says that questions foster a better understanding of what team members know and why they believe their solution would work best. Team members should ask questions respectfully, with curiosity and with willingness to understand new information. After all the ideas, questions and evidence are on the table, Browne says that teams must quickly decide on a solution. “We can’t analyze this thing the rest of our lives,” he says. “We have to make decisions in a business environment more quickly than people typically do.” At this point, digging into the problem through a map and problem statement will be useful.

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MAKING A MAP A

fter the problem-solving team pours out its ideas and questions, the organization may realize that there is more than one right answer and many potential side effects. This is why everything— ideas, questions, potential side effects— should be recorded and arranged when digging into the problem. The end goal is to have a problem statement, a map of the company’s problems. Maps allow multiple different perspectives—economic, social, environmental—to be listed and listened to. The map will give problem-solvers what Bossi calls a “horizontal view” of the problem. “If I work on economics and finance, I can’t appreciate the work that others do, nor can I see how their performance is affecting my performance or how my performance is affecting the work of others,” he says. Nickols agrees that maps are useful, similar to a cartographer charting the territory she’s exploring. “The complete map is never done,” he says. “You will regularly get enough of it to get to where you want to be. But there’s still a lot of uncharted territory out there.” A map will also allow companies to know some of the solution’s performance indicators and potential side effects. “We must first figure out what the indicators of performance are and how they are connected to one another,” Bossi says. “Once you know indicators of performance, you can find the person responsible for a certain type of performance or one who has a good view of what’s happening and why we

are underperforming in one of the other areas.” A written system of performance indicators will show organizations causes and effects of different decisions, allowing the problem solvers to understand how different solutions could affect other areas of the business. If one part of the business is changed, and that change affects another part, this view of the problem-solving process may allow the organization to understand why. Without the map, the events may seem disconnected. Another way to arrange a problem statement comes from Weiss’ Key Business Solutions, wherein he suggests that companies use the ABC—or arrange, brainstorm, choose—method to break down a problem. Using this technique, companies “arrange” by setting a clear goal, generating evaluation criteria and informing the team of the analysis. Then, they “brainstorm,” group similar ideas together and find new ideas, treating all ideas equally. Finally, they “choose” by adding details to the solution and scoring outcomes against set criteria. Digging into a problem allows a company to avoid using a canned approach to problem-solving. Nickols says that most organizations are “committed to canned approaches,” no matter what kind of problem they’re up against. “It just doesn’t work,” he says, adding that most people realize how complex problems are after looking at questions, concerns and potential side effects. After the map has been drawn up, it’s time to implement a solution.

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FINDING AND IMPLEMENTING THE SOLUTION W

hen Nickols worked as an executive director at Educational Testing Service in the early 1990s, the rejection rate for one of the company’s health care certification tests was more than 70%. That was too high, he says— test-takers’ careers were on the line. The clerical staff at ETS were convinced that people filling out the forms were inept, but Nickols saw that the problem was the system itself. Half of the rejects had an invalid or missing institutional code, a number that identified where the registrant was trained or would be employed, he says. The other half were rejected because of sloppiness, such as leaving fields blank that needed to be filled in. To fix the problem, Nickols told the clerical staff to ensure registrants were instructed that ETS wanted a “clean and complete” registration form with all fields filled in. He also realized that registrants were given a numerically ordered institutional code list that they’d have to scan for their institution. To fix this issue, Nickols told staff to give registrants an alphabetically ordered list of institutions. After ETS made the changes, the rejection rate plummeted from 70% to 9%, Nickols says. Although this problem seemed easy to solve, Nickols documented everything, just as he would when mapping any other problem. He did this in part to be accountable and responsible, but also because he got the same question from other executives after each problem: “How the hell did you do that?” “It’s partly a matter of being accountable,” he says. “It’s partly a matter of sharing what was learned with others. It’s partly a matter of having a record that’s more than just a history. Think of it as a problem-solving memory.” This problem-solving memory will help

companies stay vigilant for side effects of the solution with an organization-wide view, Nickols says. In Smart Questions: Learn to Ask the Right Questions for Powerful Results, authors Gerald Nadler and William J. Chandon suggest that businesses should create a “living solution” to problems. The living solution is similar to the solution companies plan for, but the living solution takes into account a changing environment. Nadler and Chandon suggest three steps toward a living solution: First, create a detailed description of recommended changes, coming as close as possible to the solution the company had been planning for, which they call the future solution. Then, plan for successive stages of change and improvement that move toward the future solution. Finally, have an installation plan to begin working on the stages of change. Nadler and Chandon write that there are challenges to having a living solution, including lack of resources, unavailable technology, changes in attitude or skepticism from key decision makers. To anticipate these challenges, the authors suggest that problem-solvers ask questions and think holistically about the living solution. Ask information questions like: What specific information needs to be collected to stay as close as possible to the future solution? Ask questions of uniqueness like: How can we develop a living solution and an implementation plan that work within our environment and stay close to our future solution? Ask systematic questions like: What are potential input ideas for overcoming a challenge that prevents us from adopting the future solution now? Browne says that businesses should implement solutions as quickly as they

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decide on them. Although they will occasionally make mistakes, they will also become agile when dealing with problems. Businesses don’t often have four or five months to decide on a solution— by the end, they may have already lost millions of dollars—so quick decisions are imperative. “That’s where the role of leadership experience and knowing who, from the past track record, you can depend on,” Browne says. Though a good record doesn’t guarantee future success, he says looking for high-probability events is the best option. InnoCentive’s Fredrickson uses a fishing analogy to show why companies must decide quickly on solutions. You can know all the

best spots in the lake and catch the fish, but do you know what you’re going to do once you catch it? Will you eat it, take a picture and throw it back or simply let the fish rot in the boat, just as an unused idea lies dormant in a company? “Unless you are intentional and continue to experiment, you’ve just gone fishing—you caught some fish, but you really didn’t do anything with it, and it rots,” Fredrickson says. “At that point, it’s not innovation because you never really acted on what you found.” Once the solution is in place, companies must continue to test their theories, always willing to accept that they may have been wrong.

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REVIEW RESULTS, ANALYZE THE FUTURE AND ALWAYS TRY AGAIN F or 20 years, Browne and his wife were blackjack counters. “One of the things that always amused us was when we’d be flying to Vegas or Macau and there’d be people on the plane getting ready to play blackjack,” he says. “They’d all have a system and say, ‘I cleaned them out last time.’ They don’t understand: The dumbest monkey in the world could play blackjack and win—it’s just that over time, you lose. That’s the math of the system.” Much like blackjack, solving problems isn’t an exact science, but it does require some scientific thinking and experimenting. Companies need to grow comfortable with making hypotheses and mistakes and learning from both. Much like card counters must recount when the deck is shuffled, businesses must anticipate a changing environment—measurements, criteria for success, people in the organization, outside factors. What can’t change is a company’s dedication to learning from mistakes and adjusting quickly. “When you make a mistake, ask, ‘What did I miss? Why did I miss it? What did I fail to do?’,” Browne says. “That’s an analytical process of reviewing the bad decisions you made rather than just wallowing in the successes of the good decisions. Bill Gates has said that success is a lousy teacher; it makes people think they know what they really don’t know. I think that’s true.” Once a company implements a solution, Bossi says that it must monitor and evaluate the solution’s performance on an ongoing basis.

Start-and-stop exercises—for example, checking the solution’s progress once a year—usually won’t work because companies tend to treat them more like a checkbox than an embedded part of the decision-making process, he says. Continuous evaluation allows companies to catch problems as they emerge, rather than once they are fully realized. The map will be useful for ongoing monitoring, Bossi says. The company will see performance on departmental and organizationwide levels. If the solution has unforeseen consequences, the map will allow the company to see exactly where it went wrong and quickly fix the problem— or perhaps decide that what went wrong is preferable. Nickols says that the path companies take will vary for each solution. Sometimes, companies will think that they have the solution but find that their path leads to a brick wall. “That’s not because you chose the wrong path, it’s because nobody knew what the right path was,” he says. “There’s a lot of feeling your way along.” Instead of worrying about what’s at the end of each path, Nickols says that the best thing companies can do to is take a step and figure out where to step next. And if the business does reach a point where the problem is solved, there’s only one logical thing left to do: “Celebrate,” Nickols says with a laugh. “The more you succeed in solving issues and wrestling with issues, the more credible you’ll become.” m

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Annual Marketing Services Directory

Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large. In short, marketing is communicating value. Marketing services can range from market research, branding, online marketing, advertising, analytics, data collection, creative services, product development, and much more. Every year, the American Marketing Association publishes the Annual Marketing Services Directory. This directory can help you find the right company to help turn your marketing vision into reality. AN ADVERTISING SUPPLEMENT TO THE OCTOBER 2018 ISSUE OF MARKETING NEWS. COPYRIGHT 2018 BY THE AMERICAN MARKETING ASSOCIATION. ALL RIGHTS RESERVED.

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Annual Marketing Services Directory

Founded in 1999, Ascribe helps the world’s largest market research firms, corporate researchers and customer experience professionals make confident decisions based on rich, real-time insights using a world-leading verbatim analytics platform. Ascribe’s comprehensive and flexible SaaS-based technologies enable accurate and fast analysis of verbatim comments regardless of channel or language.

Ascribe

CLC is a global research consultancy working with B2B/B2C companies to plan and conduct research to accurately identify and measure requirements for customer acquisition, satisfaction and loyalty, share of wallet growth, and retention. We help organizations get better business results through improved integration of research findings into day-to-day operations. With reach to more than 3 million individuals in 160+ countries, we conduct strategic qualitative and quantitative research in multiple localized languages on a worldwide basis.

Customer Lifecycle, LLC

1-877-241-9112 x55 www.GoAscribe.com

Chicago, IL | Nationwide kaferenz@customerlifecycle.us www.customerlifecycle.us

Edelman is a global communications marketing firm that partners with the world's leading businesses and organizations to evolve, promote and protect their brands and reputations. Our diverse teams of strategists, creators and counselors bring to this work what our clients have long valued us for — in-depth expertise, unexpected ideas, and ingenious storytelling that together drive valuable impact on their businesses. As an independent, familyowned company, we’re global in reach, but our people are local, with in-depth knowledge of markets, cultures, and issues.

Make your content discoverable and digestible with enterprise and site search from Funnelback. Optimize your digital user experience to accelerate revenue-generating opportunities, refine your marketing ecosystem with sophisticated analytics, and ensure cross-platform accessibility for your digital properties. Customers around the world trust Funnelback to deliver the most efficient path to purchase in a saturated marketplace.

Edelman

funnelback

www.edelman.com/

www.funnelback.com

DatabaseUSA is the industry’s leading provider of Business & Consumer information. Our 16 Million U.S. Business database is Triple-Verified and is the most accurate anywhere. We also feature 6 Million Medical Professionals (with Specialties), 15 Million Executive Emails, 225 Million Consumers and over 100 Million Homeowners. Plus, a Money-Back Guarantee.

Database USA www.databaseusa.com

Localist is your complete event CMS solution for leading technology companies. Our mission is to create products that make events more discoverable online, connecting people with their communities. We specifically work with organizations to help them more easily publish, manage and promote their events through our event technology.

Localist https://www.localist.com/ OCTOBER 2018 | MARKETING NEWS

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Annual Marketing Services Directory Monotype provides the design assets, technology and expertise that help create beautiful, authentic and impactful brands that customers will engage with and value, wherever they experience the brand, now and in the future.

Monotype www.monotype.com

For over 45 years, Nimlok has designed and manufactured creative, top-quality trade show displays, exhibits and environments that enable exhibitors to engage their customers in ways that are truly unique. Nimlok is a premier trade show exhibit solutions company that delivers creative displays tailored to exhibitors’ specific needs all across the world.

nimlok https://www.nimlok. com/find-a-dealer/

Promotional products are an essential branding media that advance marketing campaigns. Promotional products break through the constant hum of advertising and give brands access to personal advertising space they can’t buy. For company/career resources visit PPAI.org.

PPAI www.ppai.org

YOUR AD HERE! Pulsetracker provides intelligence that helps sales and marketing professionals win more deals. Our software is an affordable, easy to use, inbound marketing and lead tracking CRM that adds value to your marketing processes, provides sales intelligence, and integrates with your existing websites and email campaigns.

Pulsetracker www.pulsetracker.com

QCA is the promotional product industry’s only independent, nonprofit, accreditation organization dedicated to helping provide safe and compliant products. QCA’s sole purpose is to certify responsible sourcing processes involved in product quality, product safety, supply chain security, social accountability, and environmental stewardship. QCA – Quality and Safety. Delivered.

QCA www.QCAlliance.org

Advertising in the AMA's award-winning publication, Marketing News, is a sure way to connect with your audience and boost your visibility. AMA's dedicated sales team will help you plan an advertising schedule that works for you. Contact us to learn about advertising opportunities in Marketing News in 2019. Email sales@ama.org for more information. ama.org/mediakit

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JOBS

Market Research: the Entry-Level Job You Should Take Though stigmatized as number-crunchers, market researchers position themselves as data-fluent and future leaders BY LAWRENCE A. CROSBY

arketing is an exciting field with many well-paying jobs, such as brand strategist, content specialist and SEO manager. Only occasionally, though, is market research aspired to or sought after. Part of the reason is that the Internet of Things, SEO and search engine marketing have diffused traditional market research roles throughout organizations and renamed them as they relate to digital marketing

or the customer/user experience, for example. Marketing research jobs have always carried a bit of a stigma as numbercrunching, dead-end staff positions that do not afford a path to profit/loss experience and the vaunted corner office. The time has come to dispel that stereotype. I graduated from college (in 1971) with what seemed like an unemployable

career advancement

Marketing research jobs have always carried a stigma as numbercrunching, dead-end staff positions. The time has come to dispel that stereotype.

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career advancement

JOBS

degree: a bachelor’s in general studies. I was fortunate to stumble into a marketing research analyst position working for a fellow named C.R. Johnston, who had recently mentored J.D. Power, before his name became synonymous with customer satisfaction ratings. My initial responsibilities were not glamorous and included managing part-time field interviewers (who canvassed door-todoor in those days) and conducting shelf audits for beer brands. (Bar coding didn’t take off until the 1980s.) But by the time I went to graduate school four years later, I had co-authored the marketing plan for the Buick division of General Motors and run car clinics leading to the introduction of several new models. That job experience served as the foundation for my parallel careers in academics and global marketing information. My story is not an exception. As management guru Peter Drucker once noted, marketing and innovation are the two basic functions of business. Neither can effectively exist without a deep understanding of customer needs and values, which requires data. Call it whatever name you like, that data comes from marketing research. In the increasingly data-rich environment in which companies compete today, marketing research—not a hunch or gut-feeling—is the key source of insight on how to attract, retain and deepen customer relationships. In fact, it’s hard to imagine how today’s top executives can be successful without direct experience making sense out of this type of information. The information that marketing researchers provide isn’t necessarily limited to the customer stakeholder group. Most marketing research agencies have tools to measure employee engagement and commitment, as well as to assess public perceptions of corporate social responsibility. It is not uncommon for those agencies, working alongside internal marketing researchers, to partner with other departments (such as human resources) in making those assessments. For these reasons, I believe marketing

research is a good place to begin a business career. The paths that emerge from that experience can be quite varied. Some begin and end their careers in the marketing research field. On the agency side, with which I am more familiar, there are opportunities for entrepreneurs who may seek to own a certain niche or progress through positions of increasing responsibility in multibillion-dollar global firms such as Kantar or Ipsos. Others may branch out from marketing research, going into management consulting on the outside or brand/marketing management on the inside. Still others (like me) may find that their experience working with complex marketing research data gives them a leg up in the pursuit of a Ph.D. and an academic career. I’m often asked about the right educational background for a marketing research job. An undergraduate degree in business is less important than having coursework in the social sciences (customers are people, after all), basic statistics (and ideally a course in regression analysis) and some knowledge of databases/coding. From there, I recommend a graduate degree after gaining two to four years of work experience. I’d suggest a master’s degree in marketing research for those planning to remain in the field and an MBA for those planning to branch out to marketing/ business management or consulting. Finally, in whatever path you may choose, it is important to grab hold of a developing trend affecting marketing and become a subject matter expert in the topic. This extra degree of specialization could be your route out of the cubicle. For me, it was customer satisfaction measurement. For today’s researcher, it might be smart products, the Chinese customer or omni-channel distribution. m

Marketing and innovation are the two basic functions of business. Neither can effectively exist without a deep understanding of customer needs and values, which requires data. Call it whatever name you like, that data comes from marketing research.

LAWRENCE A. CROSBY is the retired dean of the Drucker School of Management. He is the chief data scientist at the KH Moon Center for a Functioning Society, a part of the Drucker Institute at Claremont Graduate University.

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AMA Recruitment Classified Ads

■ Display Classifieds:

Need to hire qualified, skilled marketing professionals? Looking for qualified marketing or business professors for your University? AMA’s Recruitment Classified Ads are the most cost effective way to reach your target audience!

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ORDER INFORMATION To place a classified ad in Marketing News, please contact Joseph.Petit@

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go to http://jobs.ama.org.

CONSULTANT AVAILABLE FREELANCERS AVAILABLE QUANTITATIVE & QUALITATIVE SERVICES: Combinations of primary and secondary research and BI designed to deliver actionable results including strategic planning. Research methodology, survey and interview design, in-depth interviews, online surveys, hybrid methodologies, max diff, conjoint, and other multivariate techniques, data processing and data entry. Focus on pharmaceuticals (HCP, patients), medical device & large government contractors. Available for on-site consulting. Please call 770.614.6334.

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career advancement

CULTURE

you need, but they must also have the personality, demeanor and value system that aligns with your brand. Hiring for cultural fit is another way culture design can clearly hit your bottom line. Attracting and retaining great talent aligned with your culture and goals makes for more productive people, more in-sync departments and a culture where failure and success are equally important.

Why Service Culture Leads to Improved Sales BY KEVIN KELLY

 kevin@bigbuzz.com

ervice culture affects the bottom line. A company’s internal culture must be aligned with external culture. A product or service may be innovative for a couple months or even years, but eventually it will be copied. What then distinguishes a brand? Service. A brand’s service culture may be one of its only differentiators in a market of everconsolidating, commoditized products and services. Brands that compete on price alone are racing to the bottom. They must stand out through culture. Corporate culture, once defined by free food, weekly yoga and foosball tables, is something much greater now. It’s about how a company engages with its employees and its clients. The C-suite is starting to understand that corporate culture must be purposely created. No longer viewed as frivolous, it’s a key part of any brand’s authentic DNA, and if structured and nurtured correctly, it can become one of a brand’s most unique and powerful tools in its marketing toolbox.

Whether you know it or not, your company has a culture. Culture happens, good or bad, with or without active participation from leadership. Corporate culture can be determined by identifying, sharing and building a culture on a company’s guiding values — and yes, every brand should have clear guiding values. Corporate culture can foster creativity and free ideation or fear and stifling introversion. Either way, you will never know unless you examine and take an active part in structuring the culture your brand deserves, assuring it is aligned with the values of your leadership and your brand. Getting Executive Buy-In If leadership doesn’t buy in, company culture will be a free-for-all, no matter how many motivational posters you hang. Your culture has to resonate with your leadership, and it has to be authentic. Hiring practices follow suit: The people you hire must not only have the skills

Develop a Service Culture At my company, we discovered one of the top priorities for future improvement was to add more structure to our culture. We needed to improve internal service to one another on our team and external service to our client partners. This factor is often overlooked by companies, but it can be the difference between success and failure. Work with a trusted agency partner to help structure, articulate and implement your brand’s service culture. Create a purpose statement or common goal for all members of your organization, stated as simply and accurately as possible. Articulate service standards with a few words outlining the priorities that define your culture. Finally, define performance behaviors through a list of observable behaviors for which people can be held accountable, such as having a positive attitude, curiosity and integrity. Advertising is just one tool in the marketing toolbox. Brands need a 360-degree holistic approach to their brand-building. Service culture affects all aspects of the brand, which is why it’s so important to get right. m KEVIN KELLY is president and founder of Bigbuzz Marketing Group, which he launched in his Long Island, New York garage in 1995. Today, he oversees the agency’s client relationships, develops and innovates its suite of services and provides the creative vision for long-term growth from the firm’s office in Manhattan.

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advertisers’index

ADVERTISERS’ INDEX Quick source for contacting the suppliers in the October 2018 issue of Marketing News. 2018 AMA Symposium for the Marketing of Higher Education / ConnectEd ............................. p. 13 ttp://ama.marketing/highered2018 URL: h

AMA Marketing Week Live Conference / Thank You to Sponsors and Exhibitors ................ p. 11 URL: http://ama.marketing/MWL2018

2019 AMA Marketing Winter Academic Conference ................... inside back cover ttp://ama.marketing/winter2019 URL: h

AMA White Papers ................................................. p. 53 URL: http://www.ama.org/whitepaper

Advanced School of Marketing Research ........... p. 19 ttp://ama.marketing/ASMR18 URL: h Annual Marketing Services Directory ........... p. 48-50 AMA Digital Marketing Bootcamp ....................... p. 17 URL: http://ama.marketing/Bootcamp18 AMA Foundation’s Williams-Qualls-Spratlen Multicultural Mentoring Award of Excellence / Valuing Diversity Ph.D. Scholarship / Journal Awards / 2018 Nonprofit Marketers of the Year / Robert J. Lavidge Global Market Research Award / Leonard L. Berry Marketing Book Award ...................................................... p. 24-27 Calls for Nominations currently open: URL: http://ama.marketing/NPMarketer19 http://ama.marketing/4U4019 http://ama.marketing/Lavidge19

AMA’s Marketing Resource Directory ............. p. 6, 55 URL: http://marketingresourcedirectory.ama.org Collegis Education ................................................... p. 5 URL: http://www.CollegisEducation.com Customer Lifecycle, LLC . ........................................ p. 4 Email: info@customerlifecycle.us URL: http://www.customerlifecycle.us Edelman ........................................................ back cover URL: http://www.edelman.com/ Marketing News ...................................................... p. 50 Email: sales@ama.org URL: http://www.ama.org/mediakit Monotype ................................................................... p. 7 URL: http://www.monotype.com Salesforce ......................................... inside front cover URL: http://www.salesforce.com/google

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

Arizona-based integrated advertising, public relations and digital marketing agency, relocated to a collaborative office park to accommodate a growing staff and new business direction. The two-story office is bright with an abundance of glass and open floor plan. Industrial elements— such as exposed ceilings and concrete floors and walls—are complemented by modern finishes, such as stylish metal light fixtures, streamlined transitional furniture, white herringbone tile, bright custom wall graphics and accent walls painted the agency’s brand color, orange. A custom mural by local artist Timothy Brennan is a statement piece that greets guests as they enter the lobby, which mimics a boutique hotel. Highlights of the office include a massage room for monthly employee massages, a large kitchen with two family-style dining tables to accommodate the growing agency’s frequent team meals, three spacious private outdoor patios and a large open collaboration space, dubbed “The Park.”

PHOTOS: MARK BOISCLAIR

THE JAMES AGENCY (TJA), a Scottsdale,

Interior Design by Private Label International

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