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Comments

battle beach cheats

Great article.

Tali

I think that is an awesome trait. I find it hard to find loyal plpeoe in this day and age gosh I sound old typing shit like that.I was on a rant recently about plpeoe using me instead of being actual friends . True friends are hard to find these days. Many plpeoe are out for themselves and how they can use you, etc (sorry hot point in my mind)..You rock .that is all..Reply by on October 4th, 2010 at Monday, October 4, 2010 @ 12:17 pm@Julie {Angry Julie Monday}, I agree once you find good friends, it's important to hang onto them!

Wiemer Snijders

Not sure if you mean me (my name is Wiemer not Wesley) but 'no' it didn't show up. I'll send it via email.

David

Really sorry Wesley , it didn't show up?

David

Wiemer Snijders

David,
I posted a (rather lenghty) comment a few hours ago, but it doesn't show on your blog...

Did you receive it?

Regards,
Wiemer Snijders

Pete

David, think you are nit-picking on a lot of this to be fair.

Penetration vs loyalty in Bryon's book isn't to me about one or the other as opposed to one is better than the other to drive growth and the return is therefore better and linked to the finding on heavy & light buuer curves...and as you point out is proven out over many many examples.

Nespresso - isn't this still about penetration, much the same as mobile phone companies need handsets to sell their network time. I would bet that most of Nespresso growth is being driven by additional users (penetration) rather than getting existing users (loyalists) to have one more cup - which is still a potential strategy for growth, just one will deliver better results than the other.

I was on the other side of working inside a large mobile network who was competing with O2 at the time of the growth you mention. From my experience new users were driven by more competitive offers (O2 had some of the leading offers of the time) and these were the main reason for their increasing user base. We had a wonderful in house loyalty programme to retain existing users, the highest network satisfaction scores in the industry, people that loved the brand and claimed to be loyal users - the result we had higher churn than ever before in the networks history and ended up returning to a strong recruitment strategy through increasing the competiveness of our core offer (i.e. penetration based strategy of recruiting new users but still being appealing to existing ones).

The same for Lynx I would harbour a bet that whilst they probably increased consumption, they probably also increased the user base during the campaign...

As with your example on the Times does this just make you a heavy user and the point is recruit more users...how many more times can you subscribe to the Times? but as competiting newspaper brand I probably have the chance to recruit you...even as a light reader...

just some thoughts

David Taylor (brandgym)

Hey Richard, Thanks for commenting. Great to see this post has provoked some debate :-)

I wasn't trying to be flippant, sorry if it came across that way. I think this whole thing is pretty serious stuff.

I applaud Byron bringing data to the table - I'm an engineer and ex-P&G-er, so this is in my blood. And I think the challenge to CRM programs is a fair one.
However, I still believe there are creative ways to bend some of the rules and be less narrow-minded.

I think you miss the bigger point on Nespresso... its not just the capsules, which as you say are being copied. Its a membership based system using online selling, exclusive boutiques and aids to drive re-purchase. The annual value per user of Nespresso would be way above that of other premium, in-home coffees. The frequency of buying may be similar, but value per occasion much higher.

Also, try telling Terry Leahy that Clubcard is a waste of Tesco's time and money. Do you think they would have paid £60million to buy the company who created this CRM system if it didn't work?
And there is the example I quoted of O2's loyalty scheme building recruitment.

And don't you think its a bit naive to think that Byron is not in this game for the money as well - although perhaps he would tell us differently? Most people flogging books and consulting aint doing it out of the good of their heart - they're selling ideas like other people sell soap.

I try to be pluralistic and think broadly, as you suggest, when it comes to ideas and avoid thinking there is one ultimate solution.

David

Richard Thorogood

David - I do not think you are doing yourself any favours adopting a rather flippant approach to criticisng Byron Sharp's work. Some of your arguements have merit, but at other times you need to think more broadly.

For example, you rightly note that Nespresso only accepts Nespresso capsules (though once patents expire, Nestle will lose 100%. which is why gillette launches a new razor, in additon to trade up), HOWEVER I am very sure that there are still many occasions when you drink coffee that you don't use the Nespresso machine. So in fact what you have is 100% loyalty at home, not in total universe.
Chasing increased loyalty is a very dangerous concept that will suck many $$$s of corporate investment. We may be loyal to football teams (for my sins West Ham will be with me to my grave), but that is not how it is for brands or services. How many different beers have I drunk since New Year? Or restaurants eaten at, or clothes from different retailers purchased.

Byron Sharp's work is a good counterpoint to the weight of "facts" from the multiple CRM companies! Who are in the business to make money - something not a prime focus of Byron and his team

Chris M

Ooooh - handbags at dawn?!?

I was impressed with your twin poists on this, David. Just drawing on a couple of examples from one of my past lives (Barclaycard) and my current Pepsico (UK) client also reiterates the strengths and weaknesses you've highlighted.

Brand memory structures are important (Tropicana packaging) but brands need to be careful if those structures are based on advertising campaigns.
- Walkers is the exception to the rule in that it has succeeded in taking Gary Lineker from the 'character' to the real person, and to communicate both functional (sunseed oil, comic relief) and emotional (irresistablity) messages.
- Barclaycard struggled for years to replace Rowan Atkinson's famous campaign, perhaps because it lacked sausage to support the sizzle.
- Tropicana has struggled to bring sizzle and genuine warmth to its undoubted product quality.

It's not all about penetration.
- Tropicana grew penetration in the UK from 15% to 30% in a few years, but learned that a good deal of this growth was unsustainable. Many new buyers only ever bought the brand on promotion, they had little or no real brand affinity and never paid full price.
- Walkers has understood that a mums/families are their key supermarket user group, buying A LOT of crisps. Their more recent BritTrips promotions and associated campaigns have all been focused on their (admittedly quite broad) key user group
- 10 years ago Barclaycard turned down over 50% of new applicants. Under pressure from the new American credit cards they took them on in the '0% Balance Transfer' game which has since become the norm. They succeeded in gaining lots of new customers, but many customers who brought in an unprofitable balance transfer, then took it away again as the promotion term expired. At the same time they drove aggressively into sub-prime markets. They're still a hugly successful brand, but I'd have my doubts about their 'share of wallet'...

Byron Sharp

David

I do not admire you saying I said things that I did not.
=> not looking for your admiration.. but which are the things you did not say?

If you are going to criticise someone you need to take care to get your facts right.
=> pretty confident on my facts, but open to be corrected... please do share your concerns
=> BTW, feel free to email me if you'd rather we carried on our handbag bashing in private ;-)

Your readers can watch videos of my presentations, and read the many academic articles that are available - and make up their own minds.
=> They're of course free to do that, and you've already added a link to your TedX talk...but most readers like the fact that I do the hard work and create a summary of what they need to know

David, If you'd like to discuss substantive marketing issues then send me an email with your questions.
=> The many issues I have, all substantive, are on the blog post. I'd love it if you would give them some proper consideration, with an open mind, and reply

Byron

David Taylor

Byron,
As mentioned in the comments on post number 1, my posts were based on the book AND your talk at the IPA. In this you were gloves-off in attacking some pretty important people in the world of marketing, accusing them of being charlatans practicing medieval blood-letting. You attacked Kevin Roberts saying he dreamt up Lovemarks when he was drunk on red wine, and so on.
When you throw so many stones, get ready for some to come back your way mate ;-)

Also, in your talk you did come across as thinking you have the ultimate truth. All the questions from the floor to open up a debate were rejected. I say is that I am in fact not clever enough to have this.

Some replies to your comments below.
David

Byron Sharp

Sigh... I appreciate you are trying to sell how clever you are David (which is fine) but the personal put-downs were unnecessary.
=> How would you classify your calling leading marketers like Kotler as "medieval blood-letting, ignorant con artists"? Pretty personal, no?

You put up a straw-man argument saying that I present absolute laws of growth; you portray me as saying "thou shalt do marketing only this way". But I didn't write this. On page 201 I write that decades of research leads to 7 priorities for marketing action. But then you agree with these, so where's your beef?
=> You said in in your talk though.
My book, "How Brands Grow" (Oxford Uni Press, 2010), presents 11 scientific laws. The result of decades of research by many hard-working researchers. Scientific laws don't say "you must do marketing exactly like this", - but they tell us this is how a (known) part of the world behaves - the implications for strategy flow from that. That's really valuable knowledge, such laws have transformed other disciplines (like medicine).
=> That's why the first post was on what is good in the book - lots of it. BUT it aint the whole picture, and it has lots of holes

I hope you learnt at least something new from the book, or enjoyed the read.

Dr Byron Sharp, Ehrenberg-Bass Institute. 2011


PS As for the 'mistakes' that David has discovered:

- Does brand growth largely depend on growing mental and physical availability ? Yes (and there are many ways of doing this).

- Do rival brands sell to very similar profiles of customer base ? Surprisingly yes.
=> You miss the point. They have similar profiles, your mistake is saying that portraying a tight target is wrong (e.g Yorkie)

- Does penetration growth depend on increasing mental & physical availability for all customers (especially light/ non customers) ? Yes.. reach is essential.
=> Agreed with this

- Do the patterns of loyalty shown in the book apply in 2011 ? Yes. Don't take my word, ask Nielsen, Kantar, or BARB for data and they will show you.
=> Would love to see it. If you had this, why show data almost a decade old?

- I didn't write that all loyalty programs are rubbish. I explain how and why they are poor mechanisms for growing penetration (and limited for loyalty). See page 175 "why don't loyalty programs work better".
=> In your talk you pretty much said they were a waste of money

- Does advertising largely work by refreshing and sometimes building memory structures ? Yes.
Why does David say this must lead to boring advertising ?
=> Because the approach is mechanical, and give no credit at all to creativity. In your talk, again, you were pretty disparaging about creatives in ad agencies saying they were only interested in creative awards.
Why does David say this would lead to inconsistency ?!?!?
=> Sorry, didn't mean to suggest this

- Are there other ways advertising can work? Yes, see page 150.

- Do brand purchase rates, for different brands, all follow the same shape distribution (Negative Binomial Distribution) ? Yes. With profound implications. See page 41
=> Yes, but you fail to point out that the Coke US curve is higher than the UK, so the number of 1/2 times a year buyers is less... so as a leader you could work to increase consumption per capita

http://marketinglawsofgrowth.com/

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