Chapter 1: Marketing From the Inside Out

In June, 2002, Dick Notebaert was appointed CEO of the floundering telecommunications giant, Qwest Communications International, Inc. Qwest was the main telephone service provider across a 14-state region, mostly in the Western United States. Amid the chaos of some of the biggest corporate scandals in history, Qwest announced plans to restate its revenue for both 2000 and 2001 as a result of an investigation by the Securities and Exchange Commission and the Justice Department.

The post-restatement damage – Qwest had actually lost $2.5 billion more than it originally reported over the two-year span. Like most in the telecommunications industry, Qwest had suffered from over-capacity and over-investment and tried to “massage” things with some creative accounting practices. To make matters worse, former CEO, Joseph Nacchio, was accused of fraud and insider trading for which, incidentally, he is now serving 6 years in prison.

This came on the tail of another battle faced by Qwest around the illegal practice of “slamming”, or switching local telephone customers to Qwest’s long distance service without their permission. In 2000 and 2001, Qwest paid a $1.5 million dollar fine to the FCC and a $350,000 fine to the Pennsylvania Bureau of Consumer Protection to settle claims of slamming and deceptive advertising.

As a telecommunications marketing veteran, Notebaert’s first instinct when he assumed the reins was to create an image for Qwest that would quickly drown out the memory of the scandals. He became famous (some would say to a fault) for his “we look through the windshield, not in the rear view mirror” mantra. His “mission [was] to brand the company as one that puts service to customers and staff above all else.” According to a case study by PR Week, Notebaert felt, “Our world centers, starts, and ends around the customer. Everything we do is around the customer. And you must be able to communicate with your customers, and through a spirit of service, meet their needs. Every employee and every associate has to understand what page of the hymnal we are on – and what line of the hymn we are on – in order to have a consistent, articulate message.

As a result of this new mission, Qwest began to roll out an aggressive new advertising campaign. It went from a campaign slogan of “Ride the Light” (meant to emphasize its technological superiority) to the “Spirit of Service” (meant to emphasize a focus on the customer). To his credit, Notebaert knew that it would require more than a catchy tagline to pull Qwest out of its downward spiral. According to Notebaert, “Everything must truly reflect who we are. Who we are is our brand, and every employee has to live the brand. It goes beyond an ad company that gives you a nifty flavor of the month.

Despite the best of intentions, Notebaert ran into a few problems. Qwest not only carried the image of those scandals on its back, but it had acquired the infamous US West in 1999 in order to add local phone service to its growing product lines. US West was nicknamed “US Worst” for a reason, and it wasn’t for its lack of features or technology. US West’s customer service, or complete lack thereof, was legendary (see also America “Worst” Airlines). Even an internal Qwest document noted that when Notebaert took over, “…The company’s technicians were so ashamed to be working for Qwest that they traveled to work in regular clothes, rather than in their Qwest uniforms.

Secondly, while Notebaert spent a chunk of his time meeting with employees trying to drive home his vision (he would even call in posing as a customer to make sure customer service reps were delivering good customer service), he was fighting an embedded culture with rewards systems that focused on quantity, not quality. In short, the employees and customers weren’t buying it. Notebaert’s time was largely spent reorganizing debt, negotiating with employees and unions to forgo raises, and convincing banks to provide cash infusions. His cost cutting efforts salvaged Qwest from the wrecking yards, but didn’t come close to delivering on the “Spirit of Service” promise.

In reality, Qwest had never exhibited any history of extraordinary service and most days its service was only slightly above that of an IRS auditor or a used car salesman. What was the result of Qwest’s “Spirit of Service” campaign? Here are a few customer comments:

  • “Qwest’s Slogan is Ridiculous, Considering that Their Customer Service is Ridiculously Horrible…I do still have Qwest DSL service, but only because I don’t want to switch to cable internet and I don’t think I have any other options. If I knew of any other DSL provider in this area I would switch in a heartbeat.” 01/2007
  • “I would like to share my recent experiences with Qwest “Spirit of Service” customer service…I am completely astounded by the poor customer service and complete lack of accountability met in these exchanges. It does not appear as though any department knows or has access to knowledge of what the other departments are doing…I would not recommend Qwest to anybody I know and do not plan to be a customer for long.” 09/2006
  • “Spirit of Service? How about the Ghost of Service?” 05/2008
  • “Their service for the past eight or more years, particularly as expressed by customer “service” people, has been terrible. I’ve personally experienced excessive hold times, inflexible policies, rude reps and unresolved problems. So do I believe Qwest’s Spirit of Service? No I don’t. In fact it is a reason to scoff at Qwest. It takes more than a new slogan and a memo to all employees to make a major change, and even then it might not be enough.” 7/2005

Rather than a rallying cry that motivated employees and signaled a shift in the way the company did business, the slogan “Spirit of Service” became something Qwest’s customers used to beat it over the head with. Did it impress customers? No. Did it motivate employees? No. Did it benefit Qwest in any way? Quite the opposite.

The best analogy for this would be walking into your favorite fast food chain, looking up on the menu board, and seeing a picture of a luscious, juicy burger with crisp lettuce, gently melted cheese, and sliced tomatoes with small, shiny beads of dew cascading ever so slightly down the side. However, when you receive said burger, you have to peel it off some messy, crinkled wax paper and it looks more like a shrunken head or something your cat coughed up rather than the specimen you saw on the menu board.

In Qwest’s case, the burger didn’t look at all like the picture they painted and they were punished for it – or shall we say bludgeoned for it. Customer service is a difficult trait on which to differentiate anyway, but to say it and not deliver made the situation infinitely more difficult. What made matters even worse was that it launched the new campaign at the dawn of the social media age, so not only could frustrated customers share their outrage with the neighbor next door, they could share it with millions across the country and the world. No longer did the “unhappy customer tells ten people” rule apply. With the advent of powerful Internet search technologies, it became “unhappy customer tells everyone”.

Marketing Doesn’t Happen in Campaigns

There is a dirty little word we like use in society that has become synonymous with marketing – “campaign”. According to Merriam-Webster, a campaign is “a connected series of operations designed to bring about a particular result.” It inherently connotes a time frame, meaning that there is a starting point and a stopping point. Essentially, it means we are going to increase our marketing efforts for a certain period of time in order to achieve some revenue goal, whether than means distributing more coupons, increasing the advertising spend, augmenting sales efforts, or coming up with a slogan that we believe will resonate with the consumer.

Who are we to blame for this quasi-synonymous relationship between “marketing” and “campaign”? It could be the short-term mentality that Wall Street pummels us with between its quarterly earnings reports and stock prices that fluctuate every time a company meets, beats, or misses analysts’ expectations. It could be the Madison Avenue crowd with their “big idea” and media plans that aim to increase “brand awareness” through 30 second spots or print ads that run for finite periods of time. It could be our universities that teach marketing communications as if we still lived in 1963.

Whoever the culprit, marketers have become junkies hooked on the “crack cocaine” of campaigns. As consumers, we have been well trained to wait until the Back-to-School Sale or President’s Day Bash until we buy because, inevitably, there will always be another sale. This is not only true of business to consumer (B2C) industries, but business to business (B2B) as well. A B2B salesman will almost always be willing to make some concessions if it is the end of the month and he is trying to make his numbers or during a promotion designed to bump sales for the quarter.

If we are to look at this phenomenon objectively, I think we can postulate that all of these forces have been influential in creating the campaign-mentality in marketing, however, there is an underlying cause. When it comes to deciding what and where to buy, the consumer will inevitably default to price – if all else is equal. That means, in the absence of a differentiator or compelling reason to buy, a consumer will wait until the marketing department decides it’s time to “shoot-up” again.

In my years as a consultant, it is amazing how many companies have approached me asking if I can create a campaign that will give them word of mouth among their customers. They think that marketing is akin to Martha Stewart’s resurrected reputation, Tinker Bell’s fairy dust, or the Red Sox winning the World Series. In short, they think it’s magic. Let me share a secret that I have learned through years of trial and error (lean in close now) – real marketing doesn’t happen in campaigns. To some that may not be that groundbreaking of a statement. To others, it may shock them to the very core. You can’t turn marketing on and off at will. Unfortunately, consumers are like children – they often don’t do what they are told.

Let’s revisit our Qwest story. Notebaert and his team knew that what Qwest needed was a new image – and they were right. However, as a classically trained marketer, Notebaert felt that could be accomplished through a campaign – “Spirit of Service”. Qwest turned on the marketing faucet and invested people, money, and resources to promote the new slogan. He appointed a new Executive Vice President of Corporate Communications (and team) reporting directly to him in order to manage the communication of this new slogan, both internally and externally. They all put on positive attitude caps where “the team no longer view[ed] everything as a potential crisis, but as an opportunity.”

What the new team did not realize is that Qwest, in its current state, was 180 degrees from great service. Not only that, but with 53,000 employees at the time, it was a giant ship with a tiny rudder. It would take a long time to turn that boat around. The hope was that by saying Qwest had great service, the employees would eventually catch up. However, unless the employees saw a change in how they were treated, valued, and rewarded, it is not likely that they would treat the customer any differently. The “Spirit of Service” campaign did not help Qwest change its image, it only made matters worse.

Another one of my favorite quotes I use often with clients is from Henry Ford; “You can’t build a reputation on what you are going to do.” Most of the mistakes I have made in marketing all trace back to breaking this one simple principle in some way or another. It doesn’t matter so much what you say, it matters what you do. What E. Jerome McCarthy was trying to communicate with the 4 Ps still holds true today. If you do the right things, marketing takes care of itself.

Customer Evangelists are Earned, not Bought

I remember some of my early experiences as a bright-eyed undergraduate student sitting in my marketing communications classes. Having been raised by parents with a strong moral base, I try to maintain a high level of integrity throughout both my personal and professional lives. However, I couldn’t suppress this nagging feeling that what I was learning in school is that marketing consists of different degrees of deceit. Sure, we use terms like “spin” or “puffery”, but in essence there a disconnect between what we say and what we actually deliver.

One of my favorite parts of the movie “Elf”, starring Will Ferrell, is when he first arrives in the city and passes a local diner with a sign in the window that says “World’s Best Cup of Coffee”. He pokes his head in the door and says, “You did it! Congratulations! World’s best cup of coffee! Great job, everybody.” The reason we all chuckle at this part is because we know that the statement is simply not true. But we have come to accept it because it is just the right amount of puffery allowed by the FTC and everybody does it. (Incidentally, later on in the movie, he serves a cup of the famous joe to his female love interest who promptly disagrees with the sign).

The reason consumers invest heavily in advertising avoidance technologies (DVRs, MP3 Players, eReaders, Satellite Radio) is they have a general lack of trust in advertising. For the first time in history, consumers no longer trust “three out of four experts”, they trust “someone like me”. According to a 2009 study by The Nielsen Company, the top two sources of trust were “recommendations from people known” and “consumer opinions posted online”. There is no hidden agenda, no puffery, and no exaggeration. There is no “promiscuous sneezing” as Seth Godin calls it in his book, Unleashing the Ideavirus.

Consumer generated content, such as social media, online consumer reviews, and blogging, has grown exponentially in recent history because there is an inherent honesty to it. No catchy slogans, talking lizards, or pop music. It is simply raw, unbridled, unembellished opinion. Consumers have developed a higher level of trust in these formats because they feel the person giving the opinion has no vested interest in the transaction.

This has also bred another phenomenon which exists today – customer evangelism. For those unfamiliar with this term, it means just what you think it means. The term evangelism comes from religion and most often refers to a group of passionate believers that share the good word freely. With so much noise in the marketplace and so many mediums for sharing opinions, customer evangelism has become rampant. It used to be that 10 years ago, you could lean over the back fence and tell your neighbor about the movie you saw last night. Now you can post it on your Facebook page or Tweet it for thousands to see.

This inevitably begs the question, what does this mean for marketing? In the past, we became accustomed to dealing with marketing as an equation. If I increase the amount of dollars I spend in marketing or advertising, it will equate to a percentage increase in sales. However, marketing is no longer a line item in the budget. It requires the efforts of the entire organization to not only attract customers, but impress them so much that they feel a desire to tell others. Increasing your marketing spend can increase trial, but without the other pieces in place you simply fail faster.

This means that advertisers no longer control the message or the brand as they once did. They can, however, influence it for good or bad. Instead, their greatest control can be exercised over the user experience. What this means is that you have to produce an incredible product or service that solves an actual problem and does it better than anyone else. This means you have to deliver a premium and unique customer experience and then help your customers tell others about it. This means you have to give customers a forum to express their opinions and have the courage to listen. This means, as Mark Cuban says, you have to “treat every customer like a god.” It was through this DNA-altering philosophy that he was able to take a floundering NBA franchise, the Dallas Mavericks, and turn them into a world class organization.

Implementing a strategy that allows you to kick the campaign “crack” habit and generate true word of mouth among your customer base requires a fundamental, long-term shift in the way you do business. It is not a strategy that bumps up your quarterly earnings reports, but increases your long-term profitability and brand. Emmanuel Rosen calls it Humble Marketing in his Anatomy of Buzz. Whatever the term, the end result is the same. Consumers are demanding honest, transparent, and authentic interaction with the brands they invest in.

One of the most frequent questions I receive when talking about the principles of customer evangelism is “how much time does that take?” Inevitably, it is followed up with an “I am too busy for that” or “where do I find the time for all of this.” While it is true that there is a myriad of consultants and professionals that can help with the communications piece, truly Marketing From the Navel requires effort from the entire company – from the engineers who make the product to the front line people who create the experience to the executives who create the culture. Customer evangelists cannot be purchased with a flashy ad campaign. They have to be earned one at a time by doing the right things and doing them consistently.

Take Fisher’s Document Systems as an example. This Boise, Idaho based copier, printer, and fax dealer had a 70 year history but was struggling to increase its sales. It was spending money on traditional advertising methods, but was seeing a poor return from its efforts. At the beginning of 2006, Fisher’s began a complete overhaul of the way it did business. They almost completely turned over their entire sales force. They completely overhauled how they serviced their customers. They even went back to having a live person answer the phone and asking each customer how they did. Sales actually dipped during this period as they perfected their formula, however, by the end of the year they were 30% ahead of the previous year. It took courage (and a healthy dose of faith), but today Fisher’s Document Systems is the largest independent copier dealer in the State.

Stephen Covey uses the analogy of the goose and the golden egg in his best seller, The 7 Habits of Highly Effective People, to describe the balance between production (results) and production capability (ability or asset that produces the results). In marketing, this principle is critical. You take care of the goose (your customer) and it will take care of the golden eggs for you. If your goose is sick, it may take a little while to nurse it back to health before it is well on its way to becoming an egg producer for you. What this means is that each of us needs to change our paradigm, or way of thinking about the customer. No longer should we gauge every customer interaction in terms of how much he or she will buy, but how much he or she will sell of our product through evangelism.

The Innie Model

Gandhi once said, “Happiness is when what you think, what you say, and what you do are in harmony.” One of the most important principles I have learned in my career is to simply replace “Happiness” with “Marketing” above and align these three aspects of the business. True marketing means aligning what you think (culture), what you say (message), and what you do (experience). Only then will your efforts feed off themselves and your message will become amplified. Only then will you truly generate word-of-mouth.

I know it sounds a bit cheesy, but we are going to use a navel analogy here. First of all, it obviously keeps with the theme of the book but second, and most important, it will help you remember and contrast the two models. The first model I will introduce to you I call the “Innie” model because it provides a framework for creating the internal ingredients that naturally generate buzz. The second model I call (you guessed it) the “Outie” because it provides the framework to use those internal ingredients in order to get external customers talking and evangelizing.

It never ceases to amaze me how many companies mix up the order of their marketing efforts. They instantly default to the marketing communications tactics, such as building websites, brochures, and advertising campaigns before ever considering why someone would want to buy and, most importantly, tell others about it. The Innie is always first – it is the what before the how, the strategy before the tactics.

The Innie model was created to help you to become a company or organization worth talking about. Whether you are a for profit company or a non-profit organization or cause, the same principles apply. There are seven basic components to creating a company worth talking about. Each one on its own is critical to creating not just satisfied customers, but customer evangelists. However, when implemented together these seven principles can create a company that is truly buzz-worthy. We will go into each one in detail in the proceeding chapters, however, a brief summary of each step is given below:

Innie Model

  • Cause – Customers buy products but evangelists buy causes. They buy into something. What is your reason for being beyond just making money? What is your higher, holier calling?
  • Position – In a commodity world, you have to be both unique and compelling. What are you doing that nobody else is? What makes you truly different than your competition? (If you say customer service, you have missed the boat)
  • Culture – A brand is how you make your customers feel. Who has more effect on that than your employees? As Stephen Covey said, “Treat your employees exactly as you would your best customer because they’ll treat your customers that way – not when you are there, but when you are not there.” Employee evangelists breed customer evangelists. What are you doing to create evangelists out of your employees? What is the cause your employees can become passionate about?
  • Product – It sounds simple, but so many companies miss the fact that the biggest buzz comes from producing something great. Consider Apple, Sony, Southwest, Under Armour, and hundreds of others that build something great and then get it into people’s hands. Produce something great and there will be built-in buzz.
  • Message – There is nothing as powerful as a simple, repeatable message. Strip out the technology, the jargon, your own perception of yourself, and everything that is expected value. Create a message not a jingle. Create a one-line “silver bullet” that tells your prospects how you can make their lives better. Most importantly, a simple, repeatable message arms your customers with something to tell their friends.
  • Experience – The “customer experience” is an oft overused cliche. It is not about selling products and services in a nicer way, it is about moving upstream from the sale of the product to providing a unique experience, much the way that Starbucks changed the industry from selling coffee to providing an intellectually stimulating environment in which to meet and create. The key to a viral experience is the 3 Cs: customization, consistency, and constant improvement. The “wow” is in the details.
  • Measurements – How do you know you are doing well if you don’t know what doing well means? What needle are you trying to move? It goes deeper than revenue or profit. Identify what truly drives your business, whether it is subscriptions, referrals, blog mentions, or repeat purchases. Identify the triggers and measure, measure, measure. Always inspect what you expect.

There you have them. They may not be the cure for cancer, but the seven steps above, when executed properly, will help you create a company that will not only attract customers, but raving fans. They will help you to become a company that is truly worth talking about.

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