Vegas is like being at a party in a house with no kitchen.

This statement is designed to startle your brain, which is naturally in a static state. It uses schemas to keep its carbon footprint at the bare minimum. Schemas are mental short-hand for how the world works, or for how the brain believes the world works. They allow the brain to function without exerting undue effort. Interrupting a schema stimulates thought; the brain needs to actively process the “unknown”, which stimulates conversation. Blending two disparate schemas together into a new mental model also creates the same disruptive patterns.

Academia has long embraced cognitive science as it applies to learning and rehabilitation. Now, application of cognitive science is gaining a foothold in the business world. A great example was presented recently by Steve Knox, CEO of Proctor and Gamble Tremor. They are using cognitive scientists to help understand word of mouth and why people talk.

Here are a few of the examples he gave during a presentation at the Word of Mouth Marketing Association’s (WOMMA) recent Summit.

Disrupting a schema: Let’s say you arrive in the UK and rent a car. Yikes. Before you arrived, you knew that you would be driving on the ‘wrong” side of the road in a car with a steering wheel on the wrong side of the car. Yet, you talk about it because it helps you resolve the disrupted equilibrium that happens when you disturb your normal mental model of driving. Eventually, you get used to this new driving pattern and do not have to actively think about it as you drive. But, when you return home, you may have to reset your “normal” driving schema.

Disrupting schemas is a way to potentially stimulate conversation and spread word of mouth.

Conceptual blend. This is where you blend two familiar schemas to create a new unfamiliar on. One of the examples that Knox used in his presentation was the I Phone. It was a phone AND a computer; the combination of which created a whole new category. People talked about it because the very combination of two familiar devices created a disruption.People normally viewed the phone and the computer as two separate, distinct devices. When a brand creates a new blend, it owns the space. It is the epitome of first mover status.

Knox cautioned the group that applying these principles requires deep knowledge of cognitive science and hard work to strike the correct balance. The key is to use the following four questions as a guide:

· What is the foundational truth of your brand.?

· What schemas are at play?

· What would disrupt a schema?

· Are there blends that make sense?

So, why does the first sentence of this post make you stop? First: our mental model of Vegas is decidedly not one of a party in someone’s house. And, secondly, every house has a kitchen, right? These disruptions can take us on an interesting path that epitomizes both the art and science of conversation. The application to the science of word of mouth marketing is interesting and intriquing.

Our firm, ComBlu, hosted the Midwest regional judging of the WOMMy Awards a few weeks ago, which are sponsored by the Word of Mouth Marketing Association (WOMMA). A group of judges from agencies, not-for-profit and big brands got to determine the bronze, silver and gold winners in the engagement category. It was very interesting to see the state of the art of word-of-mouth engagement programs. The entries ran the gambit from internal stakeholder engagement to big brand extravaganzas. The winners will be announced at WOMMA’s Summit in Los Vegas in mid-November so I can’t say much more about the entries or the winners.

One of the best parts of the day was meeting our fellow judges and hearing their perspectives and different takes on the entries, the industry and their own campaigns and programs. One judge was from a local university and mentioned that they had launched a community for parents a few years ago. She relayed how much they had learned over the past few years and talked about how their skills and point of view had morphed to meet the needs of this new social medium. She told a story that occurred early-on when a colleague commented, “There’s no activity in the community this week; isn’t that great?” We laughed because in this instance, of course, “no news is bad news.”

The whole point of the community is engagement with the parents, helping them have a great experience with the university and to feel secure that their children are in good hands. A great mission for a university-sponsored community. Her colleague was applying old school thinking to a new media solution. In the past, no interaction with the parents was equated with no complaints! In the community model, however, they want action and reaction. They want to hear the good, the bad and the ugly. They want to improve parent/university relations and learn from these constituents in real time. It’s a smart strategy; these parents will have a great story to tell other parents in their networks whose kids are considering this choice for higher ed.

This judge’s story was interesting; more so than some of the entries! Not all of them really had a lesson to teach, which I think is at the essence of what an award winning program must do. Award winners should model best practices against a defined business challenge as well as demonstrate exceptional ROI. They also need to be strategically brilliant and stun us with their creativity. Not necessarily their creative, but their creative execution of a well thought through strategy.

Many of the entries did just that while others are still representative of early efforts to give social marketing a whirl. Nothing wrong with that, but I was heartened to see how far the industry has come. Many of the entries demonstrated solid business results and used some tried and true techniques in unusual or new ways. That we have tried and true techniques alone speaks volumes of the growth and evolution of this marketing discipline. I can’t wait to hear about the winners in the other categories. I’ll share more insights from our group after the awards ceremony on November 18^th.

Ford Motor company’s biggest competitive marketing weapon is a doddering 100 year old.  Actually it is about 100,000 doddering 100 year olds.

The other day I went to a meeting and the person I met drove up in his Model T.  Well, it isn’t every day you see a Model T, so it attracted a bit of attention. 

So when a throng of people gathered around, my friend was more than happy to answer every last question and show it off.  It isn’t pretty, but surely a piece of living history.

I learned that there are about 100,000 of them driving across our U.S. roads every day and driven they are.  Heck, there are about a hundred in my neck of the woods.  Their owners drive them a lot.

Unlike another friend of mine who owns a different type Ford (a GT 500 that turns more heads than the Model T), which seldom makes its way out of his well appointed garage, the Model T’s are driven a lot and pretty much all the owners are like my friend.  They love to talk about the car, the history of Ford Motors, etc.  Their knowledgeable, have great stories (like the pictures that Karl carries in the car of his grandfather in his horse and buggy on his way to buy this very car) and are generally likeable people.

Apparently, the Model T is bomb-proof.  As a lot, they were well designed, well engineered and well built.  He changes the oil, using the original glass container and changes tires using the original jack and tools, which while ancient are as functional as the day they were made. 

My friend’s has had no major work since it was bought in 1927; still it runs and runs as reliably as his other car, a Volvo.

Hmm.  A direct comparison between a new Volvo sedan and a Ford Model T, and he is serious about the correlation.  He talks about Ford value and engineering and he gives examples….on occasion, using the car.  Heck, we even got to see what real floor boards look like! 

I learned a lot in talking to Karl about Ford, some things were factual like the use of vanadium that was came from the wreckage of a race car.  Nobody in the U.S. knew how to make this metal (which was much lighter and three times stronger that traditional steel of the day).  So, Henry Ford financed and set up a steel plant to figure it out and then make vast supplies of it.  I learned that 30 types of black paint were used.  Why?  Because the car was built on an assembly line (the only one at the time) different mixtures dried at different speeds, and that, along with the parts the paint went on impacted potential choke points in the assembly line.  Don’t think in it’s day that wasn’t wicked-smart innovation.  Other things were anecdotal.   Both were interesting and informative the way no tv commercial or YouTube video ever could be.

Let me tell you that the people who were asking Karl questions very much pay attention to what he says and he answers them and advocates in a very genuine way.  To the person, they leave the conversation with Karl with a very different perspective and a very positive impression of the Ford brand. 

So Ford has 100 Ford Fiesta running as part of a social media campaign designed to drive interest in the European version of the car, which will debut here as the 2011 model.  Ford, like all of its, solvent and bankrupt competitors spends hundred millions of dollars on marketing.

I would content that while all of this is fine, spending the equivalent to one television advertisement to support an ambassador program of Model T drivers to spread the word about Ford Quality and value (remember, value is the new black), as well as, fuel a grass roots movement to the return of value.  Ford style.

It’s my guess that that such an approach would exceed the results of traditional mar/com tactics in terms of engagement metrics…by a lot.  A big bang for the buck. 

So Bill, if you read this and I hope you do, you need to focus on tapping into the passion of your customer base and utilize what drove Ford to prominence in the first place:  Innovation and quality.  It’s all found there in that 100 year old car and its loyal, passionate, visible and quite large owner base.  I bet if you asked nicely, they’d help.

Traditional approach to marketing a brand?  No.  Innovative and effective?  Yes.

Ever look at a menu that has gobs of things on it and you still can’t find something that is appealing?  Yep, happens all the time-at least it does to me.

Why is this?  It’s because even though there is a lot of stuff on the menu, the right thing isn’t there, so I have to settle for what’s already there.  More times than not, when this happens, I am disappointed.

Virtually every brand has loads of products and services.  A niche product for every niche market.  Wait, isn’t this in part why GM got in trouble?  Having a bunch of brands and each brand having multiple products and each product available with a host of different options.  Sounds sort of like taking the shotgun approach to me. 

I can see it now.  A focus group convenes somewhere in Dallas, each member happily pocketing their $100.00. 

Executives sit behind the glass and hear what they want to hear.  They fly back to Michigan (coach) and close the doors and get to work.  We’ll give the people what they want!  More importantly, we’ll give them what they need!  True innovation all in one package, which just so happens to share the same chassis as the Trailblazer, seats as the Enclave and instrument dash as the Vue..but never mind that!

The result?  A very time consuming and expensive do-do egg, which arrives with a thud and then silence (remember the Aztec?)

Why is it that marketers rarely learn from their mistakes and routinely try to own the entire process, keeping it locked behind an iron door?  Ok, I get the whole ‘because open-sourcing innovation eliminates the competitive advantage and element of surprise argument.  But when you as a brand face a particularly vexing problem, why not tap advocates and uber users to help innovate?  Let them help to create the lighting in a jar.  Once the idea hits a critical mass, bring it in house and do what most successful companies do best.  Manufacture, distribute and market.

Here is an example I want to keep an eye on.  In blog post, Michael Arrington created a call to action.  We Want A Dead Simple Web Tablet For $200. Help Us Build It.

Here was his call to action:  I’m tired of waiting - I want a dead simple and dirt cheap touch screen web tablet to surf the web. Nothing fancy like the Dell latitude XT, which costs $2,500. Just a Macbook Air-thin touch screen machine that runs Firefox and possibly Skype on top of a Linux kernel. It doesn’t exist today, and as far as we can tell no one is creating one.  Some people raised their hands, and presto.  In a very short time (think 1/10th to 1/50th the development time of a traditional manufacturer at what I guess was 1/500,000th the cost) they went from this (the ID mockup):

to this (the alpha…where’s the can of Diet Mountain Dew? Oh, wait, there’s a Red Bull.  Phew!):

to this (yep, Apple sexy):

Some influential people watched on with growing curiosity and began to comment.  As did the people…specifically the niche that would snap this up.  Here are a few verbatims:

Chewbenator Why doesn't the Kindle look like this? 

(My insertion: Well, Amazon, why doesn’t it?)

Leomar Grullon
8:14 PM on Thu Apr 9 2009

This think looks sweet. I don't care about the specs. Do you take paypal?

Aaron Leibowitz
9:16 PM on Thu Apr 9 2009

It exists?! I thought this thing only popped up every year to give us that false glimmer of hope. It's like the oversized ipod touch I always wanted.

Eric Sheline
11:20 PM on Thu Apr 9 2009

Very excited about this! I definitely see cheap tablets (or MIDs, etc. - whatever you want to call them) as being more popular soon. There is just so much information on the web, and a tablet is the perfect device to read with while not at a desk. It just has to be fairly cheap ( <$400, less if possible), have decent battery life (5+ hours), and have a minimum 800px-1024px wide screen. I wrote up an article about this trend two weeks ago on my blog, google "Techognized" if you are interested (I do not want to be spammy by linking directly!).

tehdahl um. want. plz.

These folks represent the same type of people who would stand in line for hours to get an i-phone instead of walking into a Verizon store and immediately getting a Samsung.  Gee, I wonder if there are enough of those type of people to make a market?

So big businesses and sophisticated executives understand the concept of buy vs. build.  M&A’s happen all the time (except for the period from last October until now, unfortunately) so they can act faster.  Somebody smaller and more nimble creates something cool that is worth a lot.  The bigger guy buys them and takes it to market or makes the market bigger.

The model works.  Why don’t we apply this standard elsewhere in the business?  Why not tap advocates, subject matter experts and uber users to help with development, product support and even messaging?  Give these folks the keys and let them drive for a while.  Not only might brand avoid future Aztec’s but they might save some money (in terms of mistakes and mis-cures) along the way.  Not to mention the huge demand for a product that can be built up in advance of its launch.

But hey, what do I know?  I will keep tabs on this to see how it plays out, so more later.

Ok, I love M&M’s.  Who doesn’t.  My two year old daughter really loves M&M’s.  To her, it’s a food group.  Me, if I was trapped on a desert island and could only take one candy, it would be M&M’s. 

I doubt I will ever be put in a position to make this kind of critical decision.  Although I sort of wonder what kind of creepy reality would force me to have to do this…but that’s another blog post.  Indulge me, it’s Friday.

I saw a tweet come through from a friend of mine, Virginia Miracle (veedub to her friends) about the M&M Mbassador program.  This factoid will be important later (veedub, not the program).

Being the good student of community, I followed the link to the Mbassador home page.  I immediately dove into the comments…before I even read the post.

There were about a half a dozen comments which oozed affinity and brand loyalty.  All sorts of love.  Several craved more interaction.  They essentially said, '”Hey M&M, here I am.  Involve me!  Work with me!  Tap me as a resource!  I’ll do anything, just don’t shut me out.”

I dove a little deeper.  Lots of comments and stories about the love people have for the melt in your mouth, not in your hand chocolate crack.

When I Googled M&M Mbassador program, there it was on the top of the list.  But there is a problem (can you find Waldo?) .

If you look carefully, I was dropped on VeeDub’s page straight from Google.  The page his hosted by SatMetrix.  C’mon guys, this sort of thing is bad form!

Here is how I got to it:

I finally went back to read the original post that was prompted by Virginia’s tweet.  Here’s how it reads:

I feel for Emma.  She sounds pretty down and out.  Reading between the lines, I’d bet that you don’t see any form of direct consumer engagement coming back anytime soon.  I hope it does.  Engaged and excited consumers who love the brand are a great way to extend understanding and product adoption and use.  Heck, just look at all of the UGC people have created on their own.

A friend and colleague of mine, Pauline Ores has a great line…”Community is like gravity'. It is the same for everything or everyone.”  Or at least it should be.  Good community works the same for Apple as it should for M&M.  That is to some degree if management gets it or understands its value. 

My guess is the folks at M&M are making a short term P&L decision.  Understand it.  Too bad.  If I see more commercials of un-dead, man-sized candies playing good cop/bad cop on TV, I’ll be even more disappointed.  That means the brand chose the easy generic impression rather than an integrated customer engagement path.

What a bummer.

Recently, I was interviewed by Tom Searcy, the President of Hunt Big Sales.  Tom has spent nearly two decades in CRM, having run and sold a large CRM call center and software business. 

His recent business, Hunt Big Sales

helps sales forces from Fortune 500 to high growth entrepreneurial businesses maximize sales activities.

Thought you might enjoy.  You can download or stream the podcast here.

I had dinner last night with an economist formerly who is also a friend of mine and with whom I used to race bicycles.  Years ago, we were both track racers (riding in a velodrome with a heavily banked track).  Our specialty was the 500 meter kilo, a very fast and short race.  Later, we graduated to racing criteriums and one day ‘classics’ races.  In essence, we had become specialists.  Focusing on more dangerous, faster and shorter races.  Neither of us had the gas for longer or multi-stage races.  We’d been conditioned to perform differently.

My friend and I discussed the stage of the economy, covering four important topics.  The stimulus package, the credit lock, the paradox of thrift and wall street’s myopic approach to economic growth.  Each of these things alone are important and will have an impact on our economy for the next 20 years.  Together, no one knows what will really happen.  We have to look to the past for answers. 

The net is that a free market economy always rights itself, as long as it is based on a sound structure.  Unfortunately, the hunger for profit has caused Wall Street to create new financial instruments that are essentially based on nothing other than risk itself.  Derivatives of derivatives.  Not a lot different than playing Kino or Baccarat in Vegas.  Wall Street bet on black and it came up red.

Now that a big chunk of what fuels our economy (i.e. the financial sector) is no longer truly part of the free economy, what with the financial firms being nationalized and all, we are in new brand new territory.

That said, are we are more likely to be seriously hobbled again in the future by Wall Street itself or instead by the Federal Government’s ownership interests.  Truly, these two forces are at odds.  So what will happen?  Will our growth engine of the future be a Hemi or a Hybrid?

What I mean by this can be found in the outset of this blog post where I discuss cycling and the correlation my friend made.

The macro-economic trends which drive our U.S. economy, as well as, the integrated components of our economy that aren’t U.S. based but global in nature.  Not being an economist (like my friend), I don’t want to debate where macro-economics converts to micro and the interdependencies between the two.  Instead, here’s the important notion. 

As a cyclist, my friend and I focused on short, fast races and were not equipped to race longer races, say like the Tour of California.  Our economy is essentially a long race.  Wall Street has trained public companies to race short races.  Meet the quarterly guidance at all costs.  Juice the numbers, move assets, sell at a discount, just meet the numbers so our stock price doesn’t tank and keeps us from borrowing money or selling our bonds.  It’s a vicious cycle.

Getting new products to market, capitalizing on market share opportunities.  These are sprints.  Short races.  Running say Citigroup, AIG, Boeing, Microsoft.  These are long races.  As my friend reminded me, Lance Armstrong won 7 Tours.  He didn’t win every stage, or even the majority.  He won the overall race. 

If we want our economy to right itself, get the speculators and gamblers out of the business decision process.  They will always promote a sprint.  Let them gamble (they always will, we can’t stop that) but not at the cost of influencing the outcome of the longer race. 

Can the Mongols of Wall Street co-exist with their new bed fellows, the shackled and risk-adverse CEO’s, and their new bosses, the beurocrats and politicians of the federal government?  Maybe, if each understands their place on the team.  Sprinters sprint when appropriate and climbers climb when the need to.  My guess is they won’t play nicely. 

The fact is that the Feds never, every give up anything.  So I am not sure AIG will ever return to its previous form.  So, we shall see.  It’s gonna be a long and scary ride for sure.

Recently, I got a call from a friend of mine. He’s a pretty smart guy, but he began our call like this. “Hey, I may be an idiot because I don’t understand something that seems so mind-numbingly simple. Can you help me?” I asked him what was bothering him. He said that over the last couple of days he’s responded to a couple of surveys. One he got in the mail, another came as part of a sales receipt where he dialed into an 888 number. The third survey he had just finished and they had called him. In each instance he had been asked a question that made no sense from his point of view.

My friend owns a successful manufacturing company and has undergraduate and graduate degrees in finance, so he sees things pretty black and white. He has been a loyal customer to each of the brands to whom he’d responded to the survey information, so he was happy to take the time to complete each survey. In each survey, they asked how likely he would be to recommend their brand to others. He responded that he’d be likely to do so.

Seems simple enough, right?

Wrong.

In reality, as he said, he is very uncomfortable in imposing his point of view on others, unless they specifically ask him what he thinks; which is a rare occurrence, since he doesn’t tend to talk about such things regularly. Moreover, currently he isn’t recommending any of these brands to anyone. Not that he doesn’t love them; he said that he did. He just doesn’t go out of his way to do it, isn’t doing it and can’t remember the last time he did. This concept really bothered him.

He said to me, “Steve, the survey is worthless because it is going to report something that isn’t happening. They should have asked me if I was recommending them. Right?”

He continued, “It reminds me of a former salesman I had. He’d put into his sales forecasts projects he thought would close when he had no data to prove they would. He just felt good about the opportunity. In the end, he was trying to create a reality that really wasn’t there.

When I got rid of him, I personally went out and met with all our key customers and asked them for their honest appraisal of us. What I heard wasn’t all pleasant but it was what was keeping us from winning all of their business, so we went away and acted on what they told us.

Knowing that information was critical, it wasn’t pleasant but it was necessary. Since then, we’ve doubled our profitability and have not lost one customer. Our prices are 20% higher than our competitors. We couldn’t do this without customer advocates and we would have customer advocates without meeting their needs. We can’t meet their needs unless we know what they think.”

He’s right again. Being likely to recommend doesn’t mean you are or will. But it sure makes it easy to say “yes” and marketers feel better about reporting the fact that 85% of their customers are likely to recommend their products and services.

Sounds a lot better than currently 18% of our customers actively recommend us on a regular basis, doesn’t it? So his question to me on why this was is a good one, as was his point. What do you think?

Why is the phrase ‘are you likely to recommend’ used instead of ‘are you currently recommending’?

The answer might lie in the fact that if not enough people are recommending the brand.

Might it be because the experience falls short and that would require real and meaningful change? Perhaps it is because the brand does little to engage them as advocates? I couldn’t give him a good answer why there wasn’t (to use his terms) more of a ‘concrete present value’ to most of marketing.

In the past, I had given this friend Fred Reichheld’s book, ‘The Ultimate Question’ as well as, a couple of others such as ‘Wisdom of the Crowd’ and ‘Return on Customer’.

He liked each very much but in the end, his opinion was that it easier for marketers to keep creating TV commercials with good looking actors portraying happy customers and asking if consumers might possibly be willing to do something sometime in the unspecified future than truly engaging the customer, asking tough questions and instituting real change to meet their needs and requirements. That was my friend’s point of view. I thought that this story was worth sharing.

Here is mine: The one word you need to know to grow is ‘are’ (as in are you recommending).

It is time to stop talking about customer engagement and do it.

It is time to stop thinking we know what is in the minds of our customers and invite them into the process.

It is time to treat our best customers better than our next customer.

It is time to stop worrying about politics of making change and act.

It’s time to stop organizing focus groups that include people who have never bought our products and probably never will.

It is time to stop talking to our customers and start talking with them.