Friday, January 25, 2013

NetFlix does long-term strategy proud.

Remember back a few years ago when it seemed so smart for NetFlix to proactively shed its mail-order DVD legacy and focus on the wide-open possibilities of streaming media? No? People in the know said Reed Hastings was a bold, visionary genius--for about a week.

But then customers began complaining about paying extra for their beloved DVDs, which quickly blossomed into an online rant-fest. Customers left, prompting even more to leave. Industry folks then ran with the negativity--apologies were suddenly insincere, offerings lame, content negotiations doomed, company vision foolish.  Quickster seemed as smart as New Coke, and the only thing plummeting as fast as the company stock was Hastings' decision-making cred.

But Hastings had his day yesterday. Subscribers are up beyond even the rosiest projections, and so is the stock price. And suddenly the focus on streaming seem seems smart again, and so does Hastings.

Who could ever doubt he's smart? I've read some awfully damning opinion pieces on Hastings, and no doubt he can be a trip. But few CEOs can traverse topics as diverse as cloud technology and the entertainment industry--and I know of none who do it so well.

More importantly, his bold, forward-looking strategic decision from years ago appears brilliant once again. In this rapid-fire environment, years can seem like an eternity. But it isn't. And in my mind, that's a primary reason why strategy matters.

Netflix isn't alone in its commitment to longterm strategy. It's how Amazon has successfully moved from book seller to everything seller. They find new angles and commit to them. It doesn't always work out--Mechanical Turk anyone?--but often does. Amazon Web Services, for example, dominates the cloud market because they committed to it long before most had even heard of it.

In a damning Hastings article in Vanity Fair about 11 months ago, an investor said: "Last year, you couldn’t take a step without people asking about Netflix. This year, everyone is here for the funeral.” In 2013, I assume everyone will be there for the resurrection.

It takes courage to commit to true strategy instead of short-term tactics misnamed "strategy." But the payoff can be a business that thrives over time. Here's a quote from a Fortune Magazine interview with Hastings:
Our intention is to get Watch Now service to every Internet-connected screen, from cellphones to laptops to Wi-Fi-enabled plasma screens. We want to make it available everywhere over the next several years.
The date of that interview? May, 2007.

Thursday, January 3, 2013

B2B marketing: a struggle between emotion and rational thought

"People who work in businesses are humans first." I've heard a variation on this theme at least a hundred times over my career. Of course creatives say this; they nearly always aim for emotional connection--mostly because they think it works, but also because emotion-filled creative work is more fun to do than B2B fact-fests. More surprising are the number of cautious-by-nature clients and account folks who've said pretty much the same thing.

Supposedly there's even quantitative research backing emotional B2B marketing, according to a white paper from B2B marketing agency Upshot. Their SVP of planning, Lionel Knight, says this about it:
"[Emotion] absolutely has an impact on [potential B2B customer] reactions to marketing messages. B2B marketers should work to inspire their audience with creativity, be it a conference event, a website, a sales presentation or advertising.” 
I swear I gave that spiel verbatim as a CD.

So then, why isn't there more emotion-based B2B advertising? First of all, I think it's hard to do, and even harder to do well. Emotional ties to something like infrastructure as a service aren't exactly self-evident. And you can only turn so many times to tear-jerker stories about a B2B product helping terminal patients or disadvantaged elementary students before sentimentality fails. Same with humor. There's a fine line between quirky and dorky.

Another reason to approach emotion with care: miss the mark with emotion and sentimentality and dorky could be the least of your problems. Being fake is nearly unforgivable for many business and technology folks. And fake happens when ads are done by agency teams who don't understand the technology they're selling--but who are dedicated to bringing emotion into the work.

And let's not forget the importance of rational thought. Yes, we humans are emotional, knee-jerk creatures. To use Jonathan Haight's excellent metaphor, the subconscious is the elephant part of the brain, going wherever fear, excitement, or lust directs it. But there's also the elephant rider, the tempered conscious brain that can, at times, take control of the situation and make thoughtful, well-reasoned decisions. And if a company is buying a multimillion dollar technology solution, chances are good that someone is making a good-faith effort to be a skilled elephant jockey.

It's a matter of leveraging emotion and reason, at the right times and in the right balance. Even Aristotle knew to hit both pathos and logos. A few examples of companies that know how to achieve the right mix:


I loved DraftFCB's "the human element" campaign. Even its tagline does the pathos/logos dance. And their "solutionism" work continues this blend, albeit with more emphasis on logos.  It's not as brilliant as human element, but still very good at speaking to both the emotional and rational.


Accenture's "high performance delivered" campaign uses text to deliver logos, imagery to serve up pathos. Although I will say that, in reality, phrases like "$7 billion in annual sales" are really emotional ploys dressed up as hard business numbers.


My obvious choice. I've loved the mix of smart and humane that they and Ogilvy have sustained for nearly two decades. Just go to their website. Or watch their 100th anniversary video. Stunning.