Monthly Archives: July 2009

Is Smart Money Betting on GM?

Interview with Jane Genova:

THE NEW YORK TIMES puts the question out there: Can GM make it back?  I would reframe the issue as: What kinds of odds are the smart-money folks giving to a GM reset?

To answer this question, I caught up with Julie Roehm who has down cold the auto industry. Roehm is a marketing guru known for creativity and the know-how/courage to implement ideas.  She was able to do just that in the car world of Detroit, both at Ford and Chrysler.  Among her homeruns was making the Ford Focus cool.  Currently, she travels the globe doing marketing for a range of industries.

Here is my exclusive interview with Roehm.

JG: Let’s cut to chase.  We taxpayers who are GM shareholders want to know the odds for a GM comeback.   What do you see?

JR:  I see potential.  Plenty of it.

JG:  How about quantifying that.

JR: Jane, I can’t.  There are too many variables, some we already know such as the established global competition, the emerging new competition in India and China, and consumer preferences.  There are also the variables that we don’t know yet and probably wouldn’t be able to predict anyway.  They fall into the category of financial-markets expert Nassim Taleb’s “Black Swans,” that is, developments that are unexpected, both in their occurrence and in their impact.

Given all those variables, anyone who’s not a reckless gambler would hesitate to discuss the GM situation in hard cold numbers.

JG: Fair enough.  Then, please give readers details about the “potential.”

JR: The potential for GM to be born-again is staggering.

For example, it can create a fresh scenario for itself just as Ford did with the Mustang and later with the Focus.  The raw materials are the Chevy and the Caddy [The Cadillac brand seems to be a cat with myriad lives.]

Buick, though, will likely be a challenge in the extreme.  That challenge will become more difficult long term as the key target markets for this brand – the Silent and Baby Boom generations – have less income and may even stop driving.  You might put it this way:  Buick is “your father’s car.”  It has so much legacy that it would be difficult to make over.  But it’s possible, of course.

There is also enormous potential in the commercial-truck market.  The company knows how to be utilitarian.  The product is solid.  It also knows how to connect in special ways with personal-use individuals as well as construction workers, farmers, small haulers, and movers.  Throw in fuel efficiency and this could be a grand slam, in the same way that the mini-van and K-car were for Iacocca’s turnaround.

There’s more, of course.  But I won’t pile on remarks about every segment and every brand.  That isn’t the issue.  The issue is: Can or even does GM want to pull this off enough to change.

THE NEW YORK TIMES article cites “GM’s bureaucratic culture and consumers’ disinterest. ”  The issue is: Can and does GM want to overcome those constraints?

JG: How would you recommend removing those obstacles?

JR: That has to be start with a shift in the mindset.  That shift will generate a shift in the organizational culture.  That, in turn, can spark consumer interest.

That kind of shift requires a leadership overhaul in the areas of product development, design, operations, and marketing.

JG:  What kind of mindset would GM need?

JR: The mindset of a consumer company such as Lego, Pepsi, and Apple.  Not the mindset of a manufacturing company.

JG:  Okay, what is the mindset of a Lego, Pepsi and Apple?

JR:  The mindset is all about making it possible, probable and rewarding for consumers to co-develop, co-design, co-operate, and co-market product.

Here’s a little case history.  Lego found its way back to being a blockbuster, loved brand by making consumers partners.  All of Lego’s digital sites are committed to consumer input and to co-creating consumer experiences.  Lego even goes to the extent of having online age-appropriate categories of games for children.

This approach has been called “private-label media” by Booz and Company consultants Matthew Egol, Leslie Moeller and Christopher Vollmer. [An article on that titled “The Promise of Private-label Media” by the three is published in the Summer 2009 edition of Strategy+Business.]  Companies using it want to maximize consumer participation.  What frequently results is that they wind up developing their own unique media space.  To leverage all this, they form partnerships with ad agencies, media companies, and database experts.

In addition to Lego, Kraft, General Mills, Apple, and Procter & Gamble are also moving into private-label media.  This approach could be exactly the right move for GM.  Quickly it could make that leap into thinking and behaving like a consumer player versus an old-line manufacturing company.

JG:  Anything else?

JR: Yes.  Let me hammer home that the digital tools are there and more are being developed all the time.  From what I have witnessed traveling the globe consulting is that businesses, non-profits, and even governments not leveraging the digital to become “consumer organizations” put themselves at a distinct disadvantage with all their constituencies.

JG:  On behalf of readers, I thank you for providing this perspective on GM.  They are taxpayers and they are antsy.

Jane Genova

Corporations cannot live in a bubble!

Today Ad Age posted an article based on an interview with Bob Lutz. When I read the comments, it was clear the 99% of the respondents were very critical of the interview. My take is that Bob understands that a wholesale shift has to be made. He understands obviously that he is retiring later this year and so is likely to be thinking about setting tone and leadership that will outlast his tenure. Given all that I know of Mr. Lutz he has every intention of shaking it up and has the attitude and experience to make good on that promise. My personal wish for him would be to start with thinking (and ultimately implementing) about GM as a consumer company. That seems so stupid and obvious I know but can you tell me of one company that has really been consumer driven?? I’d be happy to argue that with anyone!

This is not a marketing and advertising discussion alone, instead this is about consumers input every step of the way…and not just in focus groups. Social media makes this immensely possible and it no longer has tobog down a process or a team of people who claim they cannot listen or respond to all inputs…the answer is they CAN listen now and they dont HAVE to respond to each one but ASK for the input. Don’t get me wrong, I am the last person to want to run a company or a division via committee but at the same time, corporations can no longer afford to live in a bubble…Detroit is a great big soapy bubble so this is no small task.

I’d love to hear your thoughts…

Auto News: Lutz Promises Drastic Changes in GM Marketing
Says Focus Needed on Brand Differentiation in Design, Advertising

DETROIT (AdAge.com) — General Motors Vice Chairman Bob Lutz says one of the first things he plans to do as the new head of marketing is make “drastic” changes in the “tone and content” of all of GM’s advertising, according to Automotive News.
When asked today during a web chat how he could improve GM’s advertising and his thoughts on Buick’s new TV spot for the Enclave crossover and LaCrosse sedan, Mr. Lutz wrote, “Let me put it this way: That Buick commercial tested very well, which is not the same as saying that it’s an effective ad. … I think you will very quickly see a drastic change in the tone and content of our advertising. And if you don’t, it will mean that I have failed.”

The Buick spots were done by Topolewski, Ferndale, Mich.
Mr. Lutz, after planning to retire later this year, agreed to take on GM’s marketing role Friday when the automaker emerged from 39 days of bankruptcy protection with its most profitable assets.

Rumors about review
There is speculation that GM will put some of its many advertising agencies up for review, but in an interview Friday, GM executives for Chevrolet, Buick and GMC denied their brands’ agencies were on the chopping block.

Mr. Lutz says his first priority will be to create the public relations and advertising messages that will “not only break through but actually leave consumers with an enhanced view of each of our brands.”

“Easier said than done,” he said, “but we must do it.”

Standing out through design
Mr. Lutz said that can happen as GM works to increasingly differentiate its vehicles through improved design.
For example, he said, the new Chevrolet Equinox small SUV and the soon-to-be launched GMC Terrain small SUV “don’t even look like they were made by the same manufacturer.”
Lutz gave some other indications as to how he thinks GM can better define its brands.
“The new Buick design direction, coupled with a soft and luxurious driving experience, is radically different from the more angular and sporty Cadillac design direction,” Mr. Lutz wrote. “Marketing also needs to respect brand differences in how we advertise the various brands and to whom.”
With that in mind, Mr. Lutz said, he intends to have Cadillac rival German luxury and performance brands such as BMW, while Buick’s task is to take on Lexus.

Social Media

Much thought and deliberation is occurring over when, how and if big brands should employ social media.  While Twittering today, I found ab interesting tweet regarding a new study being released by Razorfish on this topic.  I copied and pasted some of what I thought were the best insights below.  As an aside, I will be speaking on this topic this Wednesday on Fox Business News…thoughts welcome!

The folks at Razorfish just released a report called “Fluent: The Razorfish Social Influence Marketing Report” that entrepreneurs and marketers need to read. It examines how social media influences purchase decisions, how social features are entering online advertising, and how social media is becoming a paid distribution mechanism. The implications for you are:

Social Media LogosThe folks at Razorfish just released a report called “Fluent: The Razorfish Social Influence Marketing Report” that entrepreneurs and marketers need to read. It examines how social media influences purchase decisions, how social features are entering online advertising, and how social media is becoming a paid distribution mechanism. The implications for you are:

  • Brands must socialize with their customers because “top-down” advertising isn’t going to work.
  • Brand must develop a credible voice along the parameters of engagement, humility, and authenticity.
  • Brands must make their social relationships more symmetrical–that is, with value for both the brand and the customer.
The report also includes this gem of a list of how brands should use Twitter:
  1. Become familiar with Twitter by reviewing, or following, the activities of successful brands such as Dell (dell.com/twitter), Zappos (twitter.com/zappos) and Comcast (twitter.com/comcastcares).
  2. Listen to what is already being said on Twitter about your brand.
  3. Identify initial objectives for using Twitter, including what would qualify as a Twitter success story for your brand.
  4. Look into competitive activities and potential legal considerations, especially if there is already a Twitter account that uses your brand’s name or other intellectual property associated with it.
  5. Use the findings to decide on the appropriate opportunitysuch as offers or community building, tone of voice and method of engagement–that may be right for your brand.
  6. Since Twitter is an ongoing activity–even if your company is only listening in–dedicate a resource to monitor the conversations and competitors.
  7. Map out a plan for the content you will share, including valuable initial content to pique user interest.
  8. Integrate your Twitter account throughout your marketing experience, by embedding it as a feed on the company Web site, including its URL in communications and so forth.
  9. Maintain momentum by following everyone who follows you, responding to queries and joining in conversations without being too marketing oriented.
  10. Provide ongoing direct value through your tweets by continuing to listen, learn and fine- tune your Twitter activities.

All in all, a valuable read. Click here to download the report.

Mamas, Don’t Let Your Daughters Go To Bentonville

Marketing powerhouse Julie Roehm arrived at Bentonville, Arkansas with the 21st century equivalent of the counterculture flowers-in-her-hair.  She was hired by Wal-Mart to make it more competitive against emerging usptarts like Target.
Roehm was different, at least for Bentonville and Wal-Mart.  She had to be to turn around its prosaic branding.  It was an outsized Lee Iacocca who turned around the staid Chrysler in the early 1980s.  It is the idiosyncratic Nassim Taleb who’s turning around business assumptions [See “The Black Swan.”]
But unlike Iacocca and Taleb, she was different and a woman.  That was going to be too much for the rigid organizational culture at Wal-Mart to absorb.  It wound up vomiting it all up.  In the July 2009 edition of FAST COMPANY, Danielle Sacks narrates that mess.
One aspect of the tale is gender politics.  That was supposed to have vanished when “they” gave women control over our bodies, “let” us into Yale and made us [e.g. Laura Ellsworth at Jones Day] a managing partner at a white-shoe law firm.  Obviously, though, it didn’t, at least not in Bentonville.
Mamas, don’t let your daughters go to places like Bentonville.  Have them do their due diligence on how women executives comport themselves.  If the women are self-conscious, fearful, too grateful to be where they are – instead of delivering dazzling performance – tell them to look elsewhere.
There are wonderful workplaces for women.  Think the White House, Avon around the world, Xerox, Hillary Clinton’s staff, and CLEARCorps.

Marketing powerhouse Julie Roehm arrived at Bentonville, Arkansas with the 21st century equivalent of the counterculture flowers-in-her-hair.  She was hired by Wal-Mart to make it more competitive against emerging usptarts like Target.

Roehm was different, at least for Bentonville and Wal-Mart.  She had to be to turn around its prosaic branding.  It was an outsized Lee Iacocca who turned around the staid Chrysler in the early 1980s.  It is the idiosyncratic Nassim Taleb who’s turning around business assumptions [See “The Black Swan.”]

But unlike Iacocca and Taleb, she was different and a woman.  That was going to be too much for the rigid organizational culture at Wal-Mart to absorb.  It wound up vomiting it all up.  In the July 2009 edition of FAST COMPANY, Danielle Sacks narrates that mess.

One aspect of the tale is gender politics.  That was supposed to have vanished when “they” gave women control over our bodies, “let” us into Yale and made us [e.g. Laura Ellsworth at Jones Day] a managing partner at a white-shoe law firm. Obviously, though, it didn’t, at least not in Bentonville.

Mamas, don’t let your daughters go to places like Bentonville.  Have them do their due diligence on how women executives comport themselves.  If the women are self-conscious, fearful, too grateful to be where they are – instead of delivering dazzling performance – tell them to look elsewhere.

There are wonderful workplaces for women.  Think the White House, Avon around the world, Xerox, Hillary Clinton’s staff, and CLEARCorps.

Jane Genova