Tuesday, February 25, 2014

The Academy Award Winners And Losers. Odds For Movies And Odds For Ads


The 86th Academy Awards being broadcast this Sunday, March 2nd often ranks as the second-most viewed TV event of the year. Last year viewership was up about 3% Y-O-Y. Seth McFarland was host and the Academy’s dream for younger viewers came true: +19% in the coveted 18 to 49 demos. This year Ellen DeGeneres will host. This will be her second time.

ABC sold out their 30-second ad spots pretty quickly, with prices upwards of $1.8 million. One can never be sure whether that price-value equation and increased viewership is driven by who’s hosting or the mix of nominated movies and stars, but it’s probably a little of both. However you do the calculations, you also have to factor in the X-factor power of a live telecast in the digital age, which provides advertisers an opportunity to leverage a live show and some sort of social media and mobile outreach synergy in an attempt to engage viewers.

Attaining real brand engagement for the sponsors, of course, is more than just identifying an audience and running funny/exciting/sexy/emotional commercials, no matter who hosts, no matter how socially networked the viewers, and no matter how much they share, tweet or “like” the ads. If you want to see ROI, you don’t want to know the audience was amused, you want to know they were engaged. And much as some marketers would like to believe it, the Academy Awards, sometimes called the “Super Bowl for Women,” has not yet reached the lofty Super Bowl heights where people tune in to see what the advertisers are doing as much as (or sometimes more) for the show itself. No, people tune in to the Academy Awards looking for answers to four questions:

  1. Who’s on the Red Carpet?
  2. What are they wearing?
  3. How’s the new host going to open the show?
  4. Who’s going to win? 
For advertisers, there’s really only one question that should matter to them:

  1. What did I get for my $1.8 million + production costs?
We can’t comment about those first 4 questions, but we can about that last one. Using a validated process we quantify how exposure to the advertising on a particular show causes the viewer to “see” the brand as better meeting the expectations they hold for the Category Ideal in which the brand competes. You know, see if they were engaged or not, and not just that they saw the commercial. Or even liked it. This can be done predictively for virtually any marketing or advertising opportunity, but in this case we were looking at whether advertising the brand on the Academy Awards, got them thinking better about the brand.

This year’s study was conducted among 1,800 men and women, 18-59 years of age, screened for advertiser category-involvement, and who indicated a top-box intent to watch the Academy Awards this Sunday. Sixteen (16) specific brands mentioned in the press as possible advertisers on this year’s award show were evaluated, a week before the 86th award show. Where this backdrop significantly enhanced a brand’s equity, we’ve awarded it an Engagement Oscar. This year, the winners are.  .  .

American Express
Dove
General Motors
Mars
Pepsi
Samsung
Selsun Blue
Sprint

For the others, all we can offer up is, “Thanks for the memories.”

And yes, before you critics start carping that entertainment and engagement are not necessarily mutually exclusive, we’ll concede that’s true. Attaining both means not only was your creative top-notch, but your brand engagement strategy was as well. But that doesn’t happen as often as you’d think, and not often enough, despite all the pre-event buzz and hoopla.

This year the odds of engaging versus entertaining turned out to be 50:50. We’ll leave it to you decide if you want to take a chance with that kind of money with those odds. Brand Keys has found that engaged consumers are six times more likely to behave positively towards a brand, so just because a venue seems exciting and can generate a large, unified audience, and just because your agency has digitally “inserted” your brand into clips from classic movies, or has paid a gazillion dollars for some really fantastic special effects doesn’t mean it will work for every brand.  It’s worth remembering those wonderful last lines from Pretty Woman, “This is Hollywood, land of dreams. Some dreams come true, some don't.” If you’re a marketer dreaming of real ad success and can take out an option on entertainment or an option for engagement, you should always invest your money in engagement. Odds are you’ll see a better return on your investment.

Speaking of odds, every year we offer some up on the Oscar races based on the same loyalty and engagement assessments that correlate so very highly with positive consumer behavior and sales. Last year we hit 92%, so here are the odds for the “big” categories for this Sunday’s event. These calculations are provided for entertainment value only. If you’re making real bets on the outcomes, you’re on your own – just like advertisers without real engagement metrics!


Best Picture

12 Years a Slave                                                1/4

American Hustle                                               16/1

Captain Phillips                                               200/1

Dallas Buyers Club                                           25/1

Gravity                                                                9/2

Her                                                                  250/1

Nebraska                                                         250/1

Philomena                                                        250/1

The Wolf of Wall Street                                      80/1


Director

Alfonso Cuarón (Gravity)                                   1/20              

Steve McQueen (12 Years a Slave)                     9/1

Alexander Payne (Nebraska)                           100/1

David O. Russell (American Hustle)                   33/1

Martin Scorsese (The Wolf of Wall Street)         50/1


Lead Actor

Christian Bale                                                    100/1

Bruce Dern                                                          54/1

Chiwetel Ejiofor                                                     7/1

Matthew McConaughey                                      10/1

Leonardo DiCaprio                                                6/1


Lead Actress

Amy Adams                                                          16/1

Cate Blanchett                                                      1/14

Judi Dench                                                            50/1

Meryl Streep                                                          80/1

Sandra Bullock                                                      20/1


Supporting Actor

Barkhad Abdi                                                        16/1

Bradley Cooper                                                     69/1

Michael Fassbender                                              11/1

Jonah Hill                                                               60/1

Jared Leto                                                              1/10


Supporting Actress

Sally Hawkins                                                         44/1

Jennifer Lawrence                                                  11/8

Lupita Nyong’o                                                        8/11

Julia Roberts                                                           60/1

June Squibb                                                            44/1

About the hosting duties, Ms. DeGeneres has said, “I am so excited to be hosting the Oscars for the second time. You know what they say – the third time’s the charm.”

For marketers with real engagement metrics odds are 6-1the first time can be the charm for them.



Connect with Robert on LinkedIn.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Monday, February 17, 2014

Loyal Fans: Sports Leagues and Sports Retailers




The dictionary defines ‘loyalty’ as “the quality or state of being loyal.“ More to the point it describes it as “a feeling of strong support for someone or something,” which is a good enough definition as an exact meaning of the word, but from a brand perspective we think it needs to be beefed up.

Loyalty is also a leading-indicator of brand profitability. Likewise a barometer of a consumer’s engagement with a brand. (And not to go off on a definition spree, but real ‘engagement’ is the degree to which a brand is seen to meet expectations a consumer holds for the Ideal in the category in which the brand competes.) It’s been validated that the more engaged consumers are with a brand, the better they behave towards it. And axiomatically, if a consumer behaves better toward a brand, the brand ought to do better in the marketplace. And they do. Both those things. Behave better, and do better.

Anyway, we were thinking about all this during the Super Bowl a couple of weeks ago. To be honest, as we specialize in predictive loyalty and engagement metrics, we think about them all the time, but during the game it was perhaps a bit more pronounced. Not because of the team-versus-team thing, or the advertising, but because of the Seahawks and their 12th man.

For the football-uninitiated, the 12th man is a term for the fans in the stadium during a game. There’s a league rule that allows a maximum of eleven players per team on the field at a time. Break that rule and you get penalized. So you couldn’t actually have a 12th man on the field but in this case the 12th man refers to the fans and implies that they have a role in the game and an impact on the outcome. And while lots of teams have fans, the Seahawks make a big deal about their 12th man. And we do too. More particularly about that kind of display of loyalty, and the benefits that come with it.

They call it their “12th Man” and are counting touchdowns. We call it the “Rule of Six,” and count sales. As regards positive behavior towards a brand, loyal customers are six times more likely to think better of the brand, are six times more likely to behave better toward the brand, are six times more likely to buy more of your products, are six times more likely to rebuff competitive offers, and are six times more likely to recommend the brand. So pretty much a winning game plan for any brand whether CPG, service, or sports.

And as it was sports that got us contemplating all this, according to new ratings from our 2014 Brand Keys Customer Loyalty Engagement Index, here’s how Major League Sports currently rank when it comes to fan loyalty and engagement:


  1. National Football League
  2. Major League Baseball
  3. National Basketball Association
  4. National Hockey League
Since there’s a maximum capacity for any stadium, loyalty and engagement benefits extend well-beyond just attendance numbers. For Major League Sports, loyalty and engagement correlates very highly with TV viewership and purchase of licensed merchandise. So go team!

We also measure retail brands in our Customer Loyalty Engagement Index, and sticking with our theme, here’s how Sporting Goods retailers ranked this year:


  1. Dick’s
  2. Cabela’s
  3. REI
  4. Big 5
  5. Modell’s / Sports Authority (tie)

As mentioned, because brand loyalty and engagement correlate very highly with positive behavior and sales, and profitability, you usually see it perform in the marketplace arena. And it did.

At a time when retailers are struggling to just get by on razor thin margins, Dick’s Sporting Goods, rated #1 by customers in meeting their expectations, just reported that their fiscal 4th Quarter sales exceeded expectations, with consolidated same-store sales increasing by 7%. That’s nearly double the company’s original Y-O-Y estimate, with per-share earning up too. So go Dick’s shareholders!

The final score? From a loyalty and customer engagement perspective, the ‘Rule of Six’ matters more today than ever before. At a time where consumers expect more and decisions are made more carefully, that's the kind of rule no brand wants broken.

Because just like football, there end up being real penalties for that too.



Connect with Robert on LinkedIn.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Tuesday, February 11, 2014

Want To Make More Dough? Engagement Innovate Like Domino’s



We released the results of our 2014 Customer Loyalty Engagement Index last week (click here to download the 64-category/555-brand rankings), and it turns out that innovation is one of the critical emotional values that fires up engagement, loyalty, and differentiation, as well as consumer behavior in virtually every category. It’s been independently validated that once a brand fires up emotional engagement and loyalty and differentiation, sales and market share heat up too. Which is pretty much the aim of every brand, but, of course, is more easily said than done.

“Pizza” is one of the categories we measure, and if you think that introducing innovation as a major ingredient to a pizza brand’s recipe for success is easy, you should think again. From an emotional perspective, when it comes to innovation consumers are not talking about cooking techniques (coal ovens vs. wood-fired), crust thickness (paper thin vs. deep dish), or toppings. Not even alici fresche or brie e carciofi (fresh anchovies or brie and artichokes). No, we’re talking about a kind of innovation that moves beyond personal taste to something that changes the dynamics of the category and impacts consumer expectations and, ultimately, how they compare and choose brands.  We’re talking about engagement innovation.

This year, here’s how major chains’ own customers rated them when it came to that kind of innovation.

Domino’s                  (96%)
Pizza Hut                   (87%)
Papa John’s            (86%)
Little Caesars         (80%)
Papa Murphy’s       (75%)
Sbarro                       (70%)
Chuck E. Cheese    (68%)

If you’re surprised Domino’s is at the top of the innovation list, you shouldn‘t be. Back in the ‘70’s they introduced the 30-minute delivery-time concept, an innovation that dramatically increased consumer expectations in regard to getting their hands on a pizza sooner rather than later. This is the food version of Zappo’s innovative free, 2-day delivery-return policy, which compelled clicks and bricks retailers to adopt new standards to meet newly created consumer expectations for virtually any brand that had something to deliver and something a consumers might return.
Four decades later, Domino’s continues to innovate à la emotional engagement. They were the first national chain to promote an online order-and-pay system, informing consumers that they could use an app to order without the inconvenience of the voice command on their smartphone, let alone dial by hand. Once again, Domino’s is raising customer expectations, giving them an edge when it comes to engagement innovation.

It’s been reported that the major chains currently derive between 40-50% of their sales from digital orders. And when it comes to, well, most everything, the convention and convenience of apps continues to feed consumer expectations. But it turns out that where this increase in consumer expectations is making itself most strongly felt is among the traditional, local, independent mom-and-pop pizzerias.  Their inability to invest in an app-based technological infrastructure for ordering has been creating a real bottom-line digital-divide.

Can the neighborhood-based mom-and-pops with individualized customer service and gourmet ingredients fend off the kind of innovation that seems to be so strongly and emotionally resonating with consumers? Time will tell. But right now apps are a way for brands to better meet customers’ engagement innovation expectations in the pizza category, and look to be a way brands will be able to earn a bigger slice of the pie.

And, like every other category we track, if your brand can do that you’re sure to serve up your shareholders real dough.



Connect with Robert on LinkedIn.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Tuesday, February 04, 2014

Announcing The 2014 Customer Loyalty Engagement Index: Better Meeting Expectations = Better Customer Loyalty. And A Better Bottom Line.



In this century it’s a sure thing that what delights consumers today will be expected tomorrow. And if not tomorrow, very shortly after tomorrow. Remember the first time you saw a fob that remotely opened a car’s doors? Or the first time you saw a camera on a cellphone? It delighted you. Now you expect it. And more. Much more. You expect that fob to open the doors, but also open the trunk, turn on the engine, crank up the seat warmers, and check your Facebook page. Before you leave your house. Cameras on phones? Scorsese is editing his next movie on his iPhone. See what we mean? None of that seems all that farfetched, does it?

A few years ago our annual Brand Keys Customer Loyalty Engagement Index (CLEI) found customers were looking for “delight” from their brands. But that was then, and tomorrow has arrived. This year’s survey found that meeting customer expectations is the secret going forth for how brands can guarantee loyalty, engagement, and profits. Of course, the first step is actually knowing what customers expect.

Last month 32,000 consumers told us. They self-selected among 64 categories in which they are consumers and assessed 555 brands for which they are customers (top-20%) our via predictive and independently-validated metrics that fuse rational and emotional aspects of the categories. It uses a combination of psychology and higher-order statistical analyses, and has been used in B2B and B2C categories in 35 countries. It’s been proven to identify the real emotional engagement drivers for the consumers’ category-specific Ideal. The output allows us to determine where expectations for the drivers are high or low, and how well brands are seen by their own customers to meet those expectations.

Expectation levels vary by category – consumers do not, after all, buy computers the way they buy colas – and they’re at their highest levels in two decades – up nearly 30%. Brands have only grown on average by about 6%, so a really big gap between what consumers expect and what most brands ­– again, according to their own customers ­– are delivering. Categories more emotionally-driven are likely to have higher expectations that grow faster than rational categories, which end up having lower expectations and move more slowly. But whether expectations grow faster or slower, brands that better meet these expectations always do better in the marketplace than those that don’t. Really, always.

This year, the top-10 brands, best at meeting customer expectations and, thus, having the most loyal customers are:

  1. Apple (computers)
  2. Kindle (e-reader)
  3. Samsung (flat screen TVs)
  4. Amazon (e-retailer)
  5. Ritz-Carlton (luxury hotels)
  6. Dunkin’ Donuts (coffee and packaged coffee)
  7. Facebook/Twitter (social networks)
  8. Ford/Hyundai (automotive)
  9. NFL (major league sports)
  10. American Express/Discover (credit cards)
A download of complete listing of the 64 category-555 brand loyalty and engagement rankings can be found here.

Brands that better meet expectations for the values that drive engagement and loyalty are also brands better able to differentiate themselves from their competitors. Those brands can act as a surrogate for added-value and are rewarded, as we’ve said, with loyal and engaged customers who behave more positively toward the brand. Thus, better meeting expectations for the Category Ideal always correlates highly with positive behavior toward that brand, actual purchases and, axiomatically, sales. The difficult part, of course, is accurately measuring consumer expectations so you can plan for them. Most brands don’t do that very well.

Brands that do not accurately measure expectations and do not meet these consumers’ expectations eventually fade away. Such products and services turn into ‘category placeholders; known, of course, but not known for anything in particular. Maybe still on store shelves, but more “commodity” than “brand.” And when that happens, they become interchangeable. You just have to look at a number of FMCG or CPG categories to see that consumers don’t hold high expectations for products or services they can substitute for one another without a second thought.

It was discount retailer Sam Walton who noted, “High expectations are the key to everything.” According to this year’s Customer Loyalty Engagement Index, consumers couldn’t agree more. For brands, better meeting their customers’ category expectations turns out to be the key to loyalty, engagement, and real market success. And you can’t really expect more than that!



Connect with Robert on LinkedIn.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.