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Alfred McNair

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Killin' It...



A friend of mine shared a graphic that sent me down memory lane. I remembered discussing this "customer-centric" concept back in undergraduate school. Though, instead of Amazon or Airbnb, we were discussing an old derelict at that time known as - Circuit City. 


It was spring 2001 and I had paired up with 3 fellow business school students in a semester-long marketing competition. The winning team would present in a state competition, and the state winner was rumored to present their pitch to the executive board of Circuit City.


The goal of the competition was to develop a “turnaround plan" for Circuit City’s marketing department.

In the early 2000s, Best Buy was ramping up massive store expansions and was gobbling up customers from the consumer electronics market. Circuit City was feeling the effects of these losses already and was reportedly contemplating massive layoffs to cut overhead and restructure. 


The Survey

During the competition, most teams focused on visible brand elements and adjustments to the integrated marketing mix. - The kids call it Omnichannel marketing now days 👴🏾


My team was apparently tech geeks and data junkies because our first thought was - ask the customers what they thought. 


Our local Circuit City was nice enough to let us set up a survey booth, provided we share the feedback. We also pooled our sad, little, college pennies and paid for a survey that took place in some place called the interweb. I joke, but back then we had to download the survey results to an RTF and print them out to analyze.


Still, we found out that a statistically significant portion of respondents was driven to buy from Circuit City because the salespeople were all product experts. 


When customers called or brought in products with issues, the salespeople were knowledgeable and eager to help them correct the issues. 


My team presented its findings along with a campaign geared to showcase the Circuit City experts. We developed some creatives that could enhance the point of sale and encourage customers to ask for consultations. Most importantly, we suggested spending money on product and customer service training and suggested outdoor media could be used in conjunction with sending electronic experts to the homes of customers to fix problems.


Worried that our approach would be seen as too "operational" but confident in the research, we presented our 20-page document and 5-slide PowerPoint Deck.


We Lost

Not only did we lose. We got creamed by our professor. He pointed to the winner's presentation, and the elaborate design work they put into rebranding the company. He pointed to the runner up and the detail they put into developing multiple campaigns to run through the year with extrapolated budgeting and sensitivity analysis.


He told us, we put the least thought into our project of any team and gave us a -C.

I didn't follow up to see how the winners did at the state level. But about a year later, Best Buy announced they were starting a "geek squad." Circuit city went ahead with it's planned layoffs and focused on reducing its store footprint and refactoring its locations strategy. I read an article later that bulleted all of the companies major missteps:


  • It dumped sales of popular appliances.

  • When it spun off CarMax, it let a lot of talented management go with it.

  • Stores became too impersonal and too large.

  • To please Wall Street analysts, it went on a store expansion spree that resulted in too many stores in dicey neighborhoods.

  • To save money, it stopped paying commissions to its sales force and then fired 3,400 of its most experienced salespeople.

In the end, they ignored the very thing that was keeping its customers coming back. I caught up with one of my old teammates a few years back. She'd recently been promoted to marketing director at her company and was asking me to join her team. I had a few large consulting clients then so the timing wasn't quite right.


Anyway, we talked over drinks about that old project and Circuit City. She said she'd caught her company recently focusing too much on messaging and not enough on the customer. I don't want to fire shots at anyone so I'll just say, her CEO was much like our old professor and didn't approve of her "operational" approach to marketing.


She left them last year for a nice gig out in San Fran. I'm pretty jealous but proud of her. Her old company... is struggling. I hope they turn it around. But ::shrugs:: at least you and I won't make the same mistake 😁


Thanks for reading,


-Alfred E McNair III

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The Most Powerful Sense Known to Business

Business are People Too


A good friend of mine has three cats. They rule her home with iron impudence, deviously arranged furry obstacles, and the occasional glass tipping intimidation tactic. My friend finds it adorable and every time one of the little demons breaks, shreds or pees on something she says something like, "Oh aren't you a bad boy Heathcliff!" or "I'm gonna make you clean that up Mr. Muggles!"


I can remember last month or so just staring at her, head leaning slightly to the left, perplexed, and wondering if I should have her committed before she actual morphs into a half cat creature. Her textbook response to my vapid stares is always the same, "Cats are people too Alfred!"


This same friend recently berated me for spending my weekend working on a branding strategy for a new client. I don't do it often, but sometimes you just get in that groove, and no amount of laughter or libations can break your concentration.


After declining a night of debauchery, she says to me, "My God man, you spend more time with your projects than you do living!"


This is not true, by the way. My life is awesome...


Still, to her snarky remark I replied "Business are people too Kell!" Of course, I got an eye-rolling emoji in my message screen and went back to work, but that silly retort began churning a concept somewhere deep inside my mind.



Sense and Sensibility


Maybe I'll lose you here, but I'd ask you to hear me out.


The idea that "business are people too" is not totally unfounded. In fact, governments treat corporations as living humans in the way they are accounted for, taxed, and protected.


Just like any living thing, business are exposed to and reacts to stimuli. Through its employees and stakeholders businesses:


  • See and hear feedback about themselves and their competitors

  • Develop a nose for changes in trends and technologies

  • Sample the flavors of new strategies and tactics

  • Touch the emotions of customers & stakeholders through interaction points


Did you ever put any thought toward the idea that only one of the five senses actually affects things outside of us?


Taste, smell, hearing, and sight are all inputs, forms of data to be analyzed. Our sense of touch, however, provides both input and output to the physical world. And while feedback, research, and analysis are critical to growth and success of a business, only one aspect of a business system actually affects its customers.



The Power of Touch


There is nothing quite as soothing as a great massage or a friendly hug when things are not going your way. A firm handshake can be the difference between landing a client or turning someone away, and a pat on the back will usually boost confidence greater than a punch in the face.


In the moments after our birth, we cry out to be swaddled and crave a caring touch. As children and adults we still seek positive interaction from our personal relationships and, believe it or not, from the companies with which we chose to spend our money.


If you've ever been ignored by a store employee, mishandled by customer service, or condescended to by IT personnel, you've experienced the negative aspect of a business's sense of touch.


There is an entire discipline of business (called six sigma) that I believe is dedicated to understanding and improving "Consumer Touch Points." These are the multiple moments when potential buyers, current customers, and stakeholders interact with your product and brand. Each interaction shapes an opinion of how valuable your company is to the person experiencing that interaction. I'll likely have a whole other rant on the importance of Six Sigma and optimizing touch points but for now let's talk branding.



TouchPoint Branding


I don't believe I've ever created a brand strategy that did not include capitalizing on consumer touch points. I've come to understand that these interactions are much more powerful than any amount of advertising or promotional selling.


Moreover, touch point branding is integral to the concept of customer and brand loyalty. Businesses who put a focus on providing the best and most useful interactions with its stakeholders can reduce ad spending, increase sales multiples, and generate far more repeat customers than companies who do not.


I put together the graphic below to help explain the concept of touch point branding to my clients. It represents a typical life cycle of a customer and the moments of interaction that can help or hurt a company's brand.




These are very sensitive moments where a business's sense of touch can win a customer for life or destroy its value in the mind of that person. Yellow represents a slightly uncomfortable moment with potential to be a positive moment given the right process and amount of care.



Lotion Up Those Hands People


Take a look at Apple Inc. This is one company that takes customer touch points and touch point branding very seriously. Every touch point is deliberately designed to soothe and relax customers into enjoying their experiences with Apple products and its company as a whole.


The simple yet clean website and storefront imparts a feeling of freshness and new technology. The seemingly always cheerful mac geniuses give customers a sense that Apple is knowledgeable and helpful. Even apple's billing is so simple and effortless that you're always tempted to click the link at the bottom of your e-bill to purchase the next Apple product being offered.


They also happen to be one of the most powerful brands in the world. I'd like to believe their executives also think "Business are People Too."


Whether you do or not, you should always be aware that you're touching your customers hearts and minds with each and every interaction. So lotion up and make sure the touch is a soothing one.


Thanks for reading! Cheers!


-Alfred E McNair III, MBA

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Danger in the Water: A Screen Play

I'm going to tell you a story about channel marketing. Only it plays out differently than you might think. Names have been adjusted to protect the innocent (or guilty).


Act One: Where the Hell's the Mac & Cheese?


The screen opened to an executive dashboard. It showed four main charts that totaled up to $79MUSD in early market benefit. I felt a pit in my stomach as I watched an EPC partner slide the date selector back and forward slowly one day at a time - the wrinkle in his forehead deepening by the second. My boss was confidently explaining how a utility company could start just a little earlier than they initially planned and see a project IRR increase of nearly 3%. I was mainly just hoping my model didn't break.


I began to drive the live presentation, highlighting the table of projected energy prices when I noticed everyone's faces gradually shift from skeptical to... something else. I cut my eyes over toward a shorter guy with the receding blonde hairline - Bradley I think. He was nearly reenacting a scene straight from The Simpsons. (Imagine Mr. Burns dry washing his hands while staring at money) They had all just realized the seasonal impact on energy prices in Maryland.


The taller gentleman with the slightly Hispanic accent nonchalantly asked for a copy of the model I created. That stomach pit bottomed out again, only this time I wasn't certain why. That question just didn't feel right. We hadn't done a great deal of work with this company in the past, though they did have a decent reputation as an Architect Engineering firm. I looked over and my boss had a look on his face that - in that moment - oddly reminded me of how most 5-year-olds would react to pan seared organic zucchini pasta with a light drizzle of truffled mozzarella.


"Seriously mom... Where the hell's the mac and cheese?"



Act Two: The Pain of Nostalgia


We all wanted to secure this contract, but there is always the chance, this early in bid negotiations, that an EPC partner could drop you and go with a product producer that better fit their internal profit goals. The art of the partnering to win an energy bid can get pretty elaborate when price sensitivity is a factor. I was thinking through this when I recognized where that sick-to-my stomach feeling was coming from.


I'd actually felt it before in March of 2011.


I was working with a family owned soap and beauty products company. There were a number of retailers the company contracted with and I was helping two of those retailers understand customer flow and set promotional pricing and in-store product placement to maximize the impressions and revenue of my client's soap products. Only, I didn't sign any kind of exclusivity contract for my client. I had effectively just given the retailers a better game plan, expecting them to use it to my client's benefit.


The two retailers used my ideas to set up brands with higher margins than my little soap making client. In not fully assessing the channel that my client was attempting to market through, I'd given away the product in an ad and negatively affected their revenue stream.


It (at the time) was one of the worst failures of my adult life.


I ended up working it out and helping my client in the long run, but as an MBA who studied nothing but marketing, and operations management for 3 years, it was an embracing rookie mistake.


I reached over and tapped my boss's notebook and scribbled "maybe a consortium?" in blue ink. His eyebrows, which were previously approaching cro magnon proportions shot up and the edge of his mouth twitched up toward a smile that he quickly shifted into a flat line. He gestured at me to make the pitch. ::deep breath:: Here goes. Crap... what's that tall guy's name again?



Act Three: Indecent Proposal


"Lorenzo we would be happy to get our market research over to you. Before we do, I think there's another way we can all benefit from presenting this material delicately to the utility."


Lorenzo (huh - I guess right) frowned a little and cocked an eyebrow, "what'd you have in mind?"


"If we approach the utility in a consortium, we can provide the reduced schedule without passing ALL of the benefits through to the utility. By offering financing, we can capitalize on the Interest during construction savings, then pass the peak season energy profits through to the utility."


Lorenzo narrowed his eyes. He knew we wouldn't have to disclose our agreement terms if we form a consortium but we would have to if we presented Siemens as a just a supplier. A slow smile spread across his face, "It would reduce our risk exposure and increase our bottom line."


I grinned, "Yup."



Epilogue: Hold My Beer


If paid ads are a kiddy pool, and a limited media run is swim camp, EPC partner negotiations are base diving. Instead of staying on the side lines or saying "hold my beer" and jumping in belly first, You have to figure out where the rocks are and dive. It's at least 6 months of synchronized swimming a whole lot of invested capital once you're in the water.


Fortunately, I'd recognized the EPC as a turbulent sales and marketing channel. One that like the two retailers, would consume our advice for free and use it to make money without us. I'd also spent the better part of a year under the mentorship of the brightest sales and marketing minds in the energy business and had a decent understanding of the various offerings Siemens could make.


It took a few months of convincing the grid authorities to allow the plant to come online sooner than initially contracted. We also had to scramble to get the plant into PJM's capacity market ahead of schedule, but we won the bid.


This time, I took home the win and walked away with a lesson.


Effective channel marketing is more than optimizing content and ad spend. It also includes establishing cross-functional partnerships and fostering long-term relationships with each of them. To do this you have to take time to asses the needs, of each of those partnerships and work to keep your goals aligned with theirs.


Anything less and you are missing out on valuable opportunities to grow your business.


Good luck in your business endeavors as we enter April, and thanks for reading.


-Alfred E McNair, MBA

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