Monthly Archives: January 2010

Going Viral Is Good For Business

The goal of any business owner interested in creating a successful viral marketing campaigns is to identify individuals or outlets with high Social Networking Potential (read “How Ford Got Social Marketing Right“) and create viral messages that appeal to this segment of the population.

Notable examples of viral marketing are “Ponzi schemes”, “Pyramid schemes” and multi-level marketing (MLM).  Today, they have been replaced by the likes of The Big Word Project, Will it Blend and The Mike O’Meara Show.

At the height of B2C (Business to Consumer) it seemed as if every startup had a viral component to its strategy, or at least claimed to have one. However, relatively few marketing viruses achieve success on a scale similar to Hotmail, widely cited as the first example of modern-day viral marketing.

Viral Marketing Defined

According to Wikipedia, viral marketing refers to marketing techniques that use pre-existing social networks to produce increases in brand awareness or to achieve other marketing objectives (such as product sales) through self-replicating viral processes, analogous to the spread of pathological and computer viruses. It can be word-of-mouth delivered or enhanced by the network effects of the Internet. Viral promotions may take the form of video clips, interactive Flash games, advergames, ebooks, brandable software, images, or even text messages.

Elements of Viral Marketing

A viral message has the ability to be forwarded on the Internet. An effective viral marketing strategy:

  • Give away products or services
  • Provides for effortless transfer to others
  • Scales easily from small to large
  • Exploits common motivations and behaviors
  • Utilizes existing communication networks
  • Takes advantage of others’ resources

YouTube is a great example of viral marketing. Due to a combination of elements (from timelines to inherent humor to the manner in which the clip is distributed), certain video clips on YouTube end up as “Viral Videos.” The name is an allusion to the manner in which diseases spread–these videos, like a new strain of flu virus, start out being shared among a few people. But, also like the same flu virus, as each person who has been exposed to the video continues to pass a link to it along, the videos rack up view counts and end up viral-like phenomena.

Here are 34 ways to use YouTube (and other video hosting services) for business.

Different methods of Viral Marketing

E-mail: One of the easiest and simplest methods is email. It can be in the form of articles or advertisements which are sent to a large number of people based on your mailing list and if it results in forwarding the mail to other friends or known persons then viral marketing occurs.

Web forms: Various forms are available on the web and if your click on them, you are asked to fill in certain details that might include e-mail addresses. You are prompted to send something to your friend and if you willingly pass it to others, it is viral marketing.

Blogs: An effective viral marketing can be done through blogs. The links or information contained on a blog can often be copied to some other blogs and this increases the reach. With numerous blogs published on the Internet, you can expand exponentially.

Forums and Messages: Sending links through different messages or forums can be considered to be another type of viral marketing. A link that is present in a forum or chat room can often lead to greater links to your website than you might even expect.

Bookmarking: Allowing an easy process to your audience so that they can bookmark your website, can lead to expanding your network. If a visitor bookmarks your website, the potential of viral marketing gets enhanced.

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Are Your Customers Asking For A Divorce Or Are They ‘Feeling The Love’

According to a new study released by CMO Council entitled “The Leaders in Loyalty: Feeling the Love from the Loyalty Club“, 54 percent of the consumers surveyed let it be known that thanks to the barrage of irrelevant messages, low value rewards, and impersonal engagements, they aren’t feeling the love.  In fact, they are thinking of asking for a divorce.

The study suggests “The reality of today’s loyalty landscape is that too many rewards, points or perk programs out there are still only as sophisticated as those early trading stamp programs.  They dish discounts and free stuff to repeat buyers and gather about as much insight from the customer as those first shopkeepers exchanging place settings for swollen stamp books.”

So how does your brand’s loyalty program stack up against #1 American Express?

While you ponder that question let’s look at key indicators that customers didn’t like about loyalty programs.

  • Too much spam and junk email topped the list of negatives at 44 percent
  • Too many conditions and restrictions at 38 percent
  • Rewards that lacked real value at 37 percent

Other prevalent complaints included members having a hard time redeeming points or rewards, program membership lacking value, and communications and services not being personalized or target specifically for members.

If you intend to have a successful loyalty program you must understand key customer requirements like “personalization”, “individualization” and “value”.  Today, customers are looking for greater rewards that “earn” their business and while they are open to “perks” what they really want is to be embraced and know by the business they patronize.

Do Hotel Guests Care About ‘Pricing Practices’ Or A Good Deal?

A new Center for Hospitality Research (CHR) study released by Cornell University’s School of Hotel Administration found that hotel guests are more likely to think a rate setting practice is fair when they know how the rules work.

The hotel revenue management study involved showing one of eight distinct scenarios to 815 U.S. respondents, and asking whether the hotel was acting fairly in that particular scenario. Taylor, who is a marketing analyst for the Venetian Resort Hotel Casino, conducted this study for his senior thesis at the Cornell School of Hotel Administration, where Kimes is the Singapore Tourism Board Distinguished Professor in Asian Hospitality Management.

“We know that hotel customers accept the idea that hotel rates will change, but we don’t know when guests will think of those rate changes as being fair,” said Kimes. “We tested three factors that we thought would influence guests’ perceptions of fairness—type of trip, amount of information, and hotel brand class, in this case either five-star or three-star. Of those three factors, only familiarity with the rate rules had a strong effect on perceptions of fairness.”

As a result of this strong indication that guests want to know the rules, Taylor and Kimes suggested that hotel revenue managers focus their efforts on increasing guests’ familiarity with their pricing practices. While this does not necessarily mean publicizing all of a hotel’s rate fences, hotels could post the conditions for a particular rate class on its website, and indicate ways for guests to lock in a particular rate (typically, by booking far in advance). In the current environment, Taylor and Kimes suggest that reservation agents and front-desk clerks can explain differential rates and their associated conditions, thus shifting the guest’s focus away from simply asking for a discount.

I am surprised that hotel guests, many of whom are seasoned business travelers, really care about this sort of pricing practice.  These sorts of revenue management decisions begin with their flight arrangements, transitions to their car rental and then to their guest room rate.  It’s simply a matter of supply and demand.

What prospective guests should really be concerned about, as it relates to fairness, is a booking made through an OTA.  The OTA negotiates a wholesale rate with the hotel, often 25 percent to 50 percent less than published daily rate, and sells the guest room at the hotel’s published rate.  Now that’s “fair”???

It’s About Product Positioning And Not All About Price!

I talk to Sales Managers at hotels on almost a daily basis and one of their most commonly asked questions is “What will it take for us to win this piece of business?”

“Well you can lower the rate to $99, give me a 1 per 20 comp, waive the attrition, and throw in the Presidential Suite for me and the family for the week!”

OK, let’s get serious and break down the question to its simplest form.

“What will it take” are four words that should send a chill up the spine of every customer who is posed the question.  Why?  Because it’s “old school inside the box sales 101”.  It’s “let’s go down the price path” which gives you and the customer nothing more to discuss than price point.

Now close your eyes…take a deep breath…exhale…and repeat this sentence…“What do I need to know that will allow us to provide you with the best deal possible?”  Now open your eyes.  See, you feel much better now don’t you?

“What do I need to know” are words that say “I need to find out what you’re really looking for so I can best position and offer that’s a win-win”. 

You see it’s about product positioning and not all about price.  Here are some thoughts that will help you to position your product and close more deals.

Find attributes about your hotel that your customer can hang his hat on.  You need to find deliverables that inspire, motivate, and encourage the customer to seriously consider you as a candidate for the short list or a contract.  Remember that “price” is only one part of the equation.  If your hotel can’t stand up and deliver after the contract is signed, price means nothing.

Here is how Boca Raton Resort positions their resort…”Designed by legendary architect Addison Mizner (I don’t have a clue who this guy is), Boca Raton Resort, The Waldorf Astoria Collection (that’s selling sizzle) has reigned as an icon of elegance for more than 80 years (that’s staying power, reliability and consistency).  Today, the resort remains faithful to its glamorous past (here’s the hook), but radiates a vibrant new energy (not a musty 80-year old resort on the beach) and offers infinite amenities to provide each guest with the perfect getaway” (there’s something here for everyone). 

If you’re the ABC Airport Hotel, you still have attributes that are particular to your market niche IF you take the time to look for them with a new attitude.

Let us examine an analytic model of competitive market equilibrium in the presence of switching costs?  But seriously you need to understand your competitive set and the perceived “switching cost” for a customer.  Switching costs or switching barriers are terms used in microeconomics, strategic management, and marketing to describe any impediment to a customer’s changing of suppliers.  This is essentially what you are dealing with every time you sell against your competitive set.

Reinvent the customer experience.  There are so many things that have changed in this world over the past 12 months and those changes have directly or indirectly impacted both you and your prospective customer.  What’s important to your customer today may not be the same thing that was important to him 12 months ago.  Look for those signs, rethink the customer experience, and take advantage of it.

Position your product relative to the market leader in your competitive set.  Publicly or to prospective customers, always put your hotel on the same level as the market leader in your competitive set.  It elevates your hotel in terms of customer perception and allows you to sell without the need to “look over your shoulder”.

Find support for your hotel in and outside of your four walls.  Right now there is a customer checking out at your front desk who can attest to the great experience that he had while attending a meeting at your hotel.  Are you in your office pushing paper or out polling a potential army of supporters?  It’s actually kind of a fun exercise especially if you can find someone who is not rushing out the door to catch his next flight.

Social Media Is Not Child’s Play

Social media is not child’s play. That’s the central message of a new Forrester Research report that shows adults using social networking sites in big numbers. Some of the report’s findings:

  • A third of adults post at least once a week to social sites such as Facebook and Twitter.
  • A quarter of adults publish a blog and upload video/audio they created.
  • Nearly 60% maintain a profile on a social networking site.
  • 70% Read blogs, tweets and watch UGC video.

On Groundswell, one of the Forrester blogs, Josh Bernoff suggests three ways you can use the data:

  • Convince your boss this stuff is for real, and that if you haven’t jumped on it, you’re late
  • Profile your customer base, and see what they’re ready for, before planning a project to reach out to them. (After all, People is the first step in the POST process.)
  • Segment your audience; build different strategies for different segments. (Social is so prevalent now that a single approach for your company is probably too broad.)

Don’t write off the importance of social media, especially at the local level. Those small numbers of Twitter followers you see each have an average following of 126 users. When you multiply the number of your users times 126, you get a big number of people who can retweet your stuff.