Knowledge is power. So it’s important to know what it is, how it works, and its effectiveness, whether you’re leading a marketing team or whether you’re simply a consumer of information.
Mike Smith is Senior Vice President of Revenue Platforms and Operations for Hearst Magazines Digital Media and Senior Vice President of Advertising Platforms for Hearst’s Core Audience. (Can you imagine fitting that title on your business card?)
You recently surveyed 100 North American CEOs, and fewer than 1/3 felt that the brand strategy they had commissioned had been effective. Why do we so often get it wrong?
Branding campaigns fail or fall flat for several reasons: resistance to change, uncertainty around how to implement the strategy, too many competing ideas—maybe even business strategy that has moved beyond a recently completed brand initiative.
But there’s another big reason: branding is too much fun. (Yes, really!) Branding is the part of a marketing campaign that gets a lot of attention—the eye candy that the senior leadership is quick to notice. Why? Because it speaks to the emotional side of a product or service and is a great distraction from the day-to-day, boring details behind that product or service. But when you launch straight into branding before parsing those “boring” details—before you understand the exact space in the marketing landscape your company is uniquely qualified to fill—you’re putting the cart before the horse. A sexy or fun brand package is great to look at, but if it doesn’t capture a company’s role and relevance in the market (its position), then it’s little more than a pretty face without any substance to back it up. That’s where my DNA-based methodology comes in. It offers an actionable framework for using your company’s genetic makeup to determine competitive advantage.
I recently spoke with Amanda about her work and her new book.
What is driving the need for fearless growth?
We all know growth is essential to a business’s health, but no matter what industry you’re in, you probably feel stress brought on by new technologies, changing customer behaviors and preferences, and new competitors that threaten your business’s ability to grow. Here are a few examples:
The food industry is investing to keep up with sometimes capricious trends in public perception regarding low-fat, low-carbohydrate, non-GMO, gluten-free, organic, alternative sweeteners and grains, and other choices.
The consumer products industry must continuously seek to find new and better ways to interact with their customers digitally. They must respond to changing consumer buying behaviors and even to consumers’ concerns about political, social, and environmental issues.
The entertainment industry is being upended, with companies that formerly were just conduits for content—like Netflix, Amazon, Google (via its YouTube subsidiary), and AT&T (via the Time Warner merger)—now creating their own original series.
The auto industry is changing gears to adapt to the way ride-sharing services, such as Lyft and Uber, are reducing people’s desire to own a car.
The banking industry is scrambling to adjust to new modes of consumer-to-consumer payment (such as Venmo) and new forms of lending and credit assessment.
The transportation and logistics industry is responding to trends in globalization, automation, and the rise of e-commerce giants like Amazon and Alibaba.
Industrial products companies are struggling with decisions about how best to deploy sensors and artificial intelligence to improve their products’ performance and reduce cost.
The energy industry is coping with low oil prices, new government regulations, and emotional consumer sentiment on both sides of the fracking, renewable energy, and coal debates.
If your business hasn’t felt the effect of massive market changes yet, it’s likely that you will soon. And if you wait until disruption occurs, it will be too late to respond effectively.
You must grow your business, but most growth initiatives entail risk of one kind or another. I often hear company leaders saying things like, “Our core business is at risk of disruption. We need to branch out into new businesses to grow, but we don’t have all the capabilities we need—they’re not in our DNA,” or, “We’re in unfamiliar terrain and aren’t sure that customer demand will materialize. There are lots of unknowns.”
To pursue growth, leaders and employees must learn to do things they have never done before, and they must grapple with new threats. All of this adds up to the fact that trying to grow a business in today’s turbulent markets is pretty scary—it’s perfectly reasonable and rational for company leaders to be worried. I developed the new rules of fearless growth to help leaders create organizations that have the courage, speed, and agility to succeed, no matter what the future brings.
“To pursue growth, leaders must grapple with new threats.” -Amanda Setili
What can companies do to grow fearlessly, even when their business environment is changing fast?
When leaders encounter risks in their business environment, the natural human response is to hunker down, tighten the controls, and defend the existing business. What is needed, however, is not tightening controls, but the opposite. You need a fearless approach to learning and adapting to market change, and that means giving up a degree of control—to employees, business partners, and customers—in order to gain control. It’s like learning to ride a bike. At first, the bike seems tipsy and unstable, but once you start going, the movement itself creates stability.
Imagine a world where your customers want your organization to succeed. Where your employees are personally committed to your company’s success. Where your organization is not focused only on its own results, but on a collaborative effort that spans a community and beyond.
Co-creation. Share with our audience what it is and why it’s important.
It means collaborating with your most valuable business relationships to transform your business or revenue model. It can drive how you iterate, innovate or disrupt your market and in the process, evolve far beyond anything you could do alone.
“Introspection leads to right action.” -David Nour
You start the book by saying that, “Introspection leads to right action.” What’s the best way to do this?
Real introspection takes three critical elements:
Think Time – Unfortunately, given the hectic pace most of us work these days, we don’t get enough quality think time to set the minutia of the day aside and really consider our relevant strengths and strategic relationships, as well as personal or professional growth opportunities.
An Inner Circle – We need to surround ourselves with fewer, but more authentic and impactful, business relationships. Most of us could dramatically benefit from fewer partnerships and alliances and more thought partners who will tell us what we need to hear.
Leading Drivers – We can’t raise the bar on our intellect, performance, execution and results… if we don’t measure leading drivers of our progress—not lagging indicators of where we’ve been, but predictive insights toward where we’re headed. You can’t win a race looking in the rear view mirror. Focus your energies on the road ahead.
What are Transformational Consumers? How is this changing company strategy?
Transformational Consumers are a massive and growing group of people who see all of life as a series of projects to change their own behavior for the healthier, wealthier and wiser. They know that this behavior change will be hard, but they believe with all their hearts that it’s possible, and they believe that they can change anything about their lives if they can master their own habits and behavior.
So they are constantly on the lookout for products, services and content they think might help. They are early adopters, and they tend to have great influence on the buying behavior of the people around them.
I like to joke that if you have ever been vegan and paleo at different times in your life, you’re probably a Transformational Consumer. Most entrepreneurs are Transformational Consumers. The head of product for Airbnb once told me that they see both their hosts and their guests as Transformational Consumers.
One important takeaway here is that this is not a niche: over 50% of US adult customers we surveyed said that they use digital or real world products several times a week, or more often, in an effort to reach their healthy, wealthy, wise goals.
The power of this framework is that it offers businesses a lens through which to more powerfully understand the real-world journeys their customers are taking as they aspire to live better lives. And that shows you how to increase customer engagement, brand love, loyalty and repeat business, as well as reach new audiences. Once you understand your real-life customers’ real-world journeys, that surfaces limitless opportunities to innovate new products, features, services and even marketing messages and content that remove resistance points and trigger progress along customers’ paths.
Rethink Your Customer
How do companies go about rethinking their customer?
Your customers are not just the people who currently buy your product or your current social media followers. I urge companies to shift to the point of view that their customers are all the people out there who are struggling with the high-level, human problems that the company exists to solve.
Go out into the real world, do customer research, watch how people operate in real life. You can even start this process by just doing some online listening on the blogs and social media sites (not your owned channels) that your audiences frequent online (reddit, etc.).
Your goal is to understand and, ideally, visually map out your customers’ real-world journeys of going from having the problem you exist to solve to no longer having that problem. You need to know what stages they go through along their journey, what gets them stuck and unstuck, where they go to do research when they need to know or find something and what words and phrases they naturally use as they try to reach their goals.
Tell us more about resistance. How do you remove it?
Think about it: Anytime you try to level-up your life, whether it’s trying to reach a weight loss goal, to work out more, or to start a side business or meditate every day, there’s a force that pops up in all of us that Steven Pressfield and Freud both call Resistance. It’s the same force that creates procrastination, causes us to get distracted or to sabotage ourselves. It’s generally the force that makes it really, really hard to make behavior changes stick.
In your customers’ journeys toward their healthy, wealthy and wise goals, Resistance includes any sort of quit point, obstacle, friction or common point of failure. These are the things that get people stuck. There are tons of spiritual, emotional, psychological and neurological root causes of Resistance, but suffice it to say that people often know what changes they need to make; they just find it very difficult to actually make them.
This creates a major opportunity for companies to win the love of the people they serve by focusing on removing Resistance.
You can remove Resistance from your customers’ journeys by creating features and products that take friction out of their path, by reducing the difficulty or cost or number of brain cycles they have to go through to create the habits or changes they want, or by inserting progress triggers into their real-world journey.
For example, at MyFitnessPal, we learned during customer research that one of the biggest obstacles (points of Resistance) that people experience along their journey from living an unhealthy life to living a healthy one is the cost of eating healthy food and the difficulty and time involved in cooking healthfully. So every team in the company explored how they might help remove those Resistance points. When it came to content, for example, we created all sorts of recipes and meal plans for feeding a family healthy, home-cooked food on the same budget we learned people were spending on a fast food family dinner ($20). We also created all sorts of video, recipe and meal-planning content to reduce the time and increase the ease and deliciousness of our customers’ home cooked meals.
“If we can keep our competitors focused on us while we stay focused on the customer, ultimately we’ll turn out all right.” -Jeff Bezos