Tag Archives: Daniel Durazo

Lessons from Toyota

Today’s congressional hearings on T0yota’s safety problems and a recent mini-crisis at work have prompted me to focus on the long held rules of crisis communications.  If you read today’s coverage of the congressional hearings and what Toyota is doing about its unintended acceleration problem, you can see how these rules come into play.

Rule One: Show you care.  Demonstrating that you are concerned about the issue shows that you are a responsible corporate citizen.  Saying that you are concerned is great, but showing you are concerned is better.

Rule Two: Take action.  The best way to show you are concerned is to take action to address the problem.  This should be done as quickly as possible.

Rule Three:  Admit mistakes and apologize for them.  Toyota has done this today and it is an extremely effective tactic.  Everyone knows that we all make mistakes and we are very forgiving if we believe the errors were unintentional.  Americans love anyone who is willing to fall on their sword.

Rule Four:  Take steps to make sure this horrible thing never happens again.  Now this is easier said than done, but if you do steps one through three correctly, most folks will take you at your word for step four.  Now just make sure it never does happen again or you’ll really be in trouble.

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Top 10 Reasons Circuit City Will Go Out of Business

 

Short-Circuit City

Short-Circuit City

You can file this one under the “kick ’em while they’re down” category.  Sorry.

 

10.  If it ain’t broke, fix it anyway.  During the ’90s, Circuit City was doing great.  The problem was, competition was coming and it was coming hard and nobody took Best Buy seriously.  If you don’t crush the competition, don’t be surprised when they crush you.

9.  In a competitive environment, don’t take your eye off the ball.  DIVX and CarMax were major distractions and Circuit City suffered greatly as a result.

8.  In 2003, Circuit City fired thousands of employees and ended commissions for sales people in favor of an hourly structure.  In 2007, Circuit City fired 3,400 of those hourly workers for cheaper replacements. When you fire well-paid veteran employees to make room for less-experienced, lower paid workers, your customers will notice.  And they won’t like it.

7.  Location, location, location!  B locations equal B customers, B sales, B results.

6.  Don’t notice too late that people want to buy movies, games and music when buying the hardware to play them.  Those low margin items helped create brand loyalty for Best Buy.

5.  Old, outdated stores need to be remodeled or closed and new, bigger ones need to be opened in competitive markets.

4. Selection and availability of hot products is crucial.  If you don’t have what I need, Best Buy, Target or Walmart will.  And next time, I will probably go there first.

3. Give customers a “real” rewards program.  Not just a come-on for a branded credit card.

2. The state of “customer service” in retail America is abysmal.  You can tell very quickly when you walk into a store that the employees couldn’t care less.  Circuit City’s reputation for customer service was far less than stellar.

1.  Filing for bankruptcy 16 days before Black Friday is an extraordinary event that no consumer can ignore. With consumer confidence non-existent and retailers fighting for every sale, you may as well just shut the chain down now.

I am very sorry for all of the employees who have or will lose their jobs in Circuit City’s meltdown.  My thoughts are with you.

UPDATE:  Since I posted this in November, I’ve begun rooting for Circuit City and was hoping it would find a buyer.  The cost of going out of business to its employees, suppliers, etc. is tremendous.  The loss of competition will surely cause competitors (Best Buy) to raise prices and worry less about having a wide variety of items to sell.  Unfortunately, my prediction came true today.  I’m very sorry for those affected.

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Can you get gray and “less white” at the same time?

As a diversion to our current economic upheaval, I’ve been meaning to post this article about America growing older and more diverse by 2050.

According to the U.S. Census Bureau, minorities, now at about one third of the population, will become the majority population in 2042 and will make up 54 percent of the country by 2050.

The shift among children is astounding.  Today, 44 percent of children are in minority groups.  By 2050, 62 percent of children will be minorities.  Maybe by then we’ll have to stop using this word “minorities.”

Hispanics will nearly triple between now and 2050, eventually making up about a third of the total population.  That’s amazing.

Non-Hispanic whites will grow by only less than 2 percent over this time period.  The 85 and over population is expected to triple and the percentage of Americans who are working age will drop from 63 to 57 percent.  By 2050, minorities will also make up the majority of all workers.

It’s gonna be a brave new world.

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Filed under Daniel Durazo, Hispanic marketing, Hispanic voters, Multicultural Marketing

Don’t mess with my blue crabs!

Here in Virginia, we have a state Commission on Climate Change that includes 43 members who were appointed by Gov. Tim Kaine about nine months ago.

Recently the Commission met and reached consensus that:

A rising sea level caused by global warming poses a major concern for much of coastal Virginia, especially the heavily populated (and traffic congested) Hampton Roads area.

Warming would have significant impact on Virginia’s ecosystems.

Some Chesapeake Bay species such as blue crabs and oysters could decline or disappear.

I don’t know about you, but when you start messing with my seafood, that’s when I get mad!

The state commission is expected to make its recommendations on December 15th.  In the meantime, check out some tips on what you can do about Global Warming.

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Filed under Climate Change, Daniel Durazo, Sustainability

An Answer to Global Warming?

Last week at California’s annual Climate Change Research Conference in Sacramento, two physicists associated with the Heat Island Group presented a paper which claims that if roofs in 100 major urban areas were switched to reflective material, they would offset 44 metric gigatons of greenhouse gasses.  It’s hard for me to picture how big a metric gigaton is, but it sounds like a lot.  In fact, 44 metric gigatons of greenhouse gasses is more than all the countries on Earth emit in a single year.

The bottom line is that dark roofs and pavement absorb heat and add significantly to global warming and climate change by trapping heat in urban areas.  Just painting roofs white and paving roads with a lighter colored material could offset more than 10 years of emissions growth.  

The paper says that replacing a dark colored roof with a white roof on an average American home would offset 10 metric tons of carbon dioxide emissions.  And that’s for just one house!

California already requires new flat commercial structures to be built with reflective roofs and next year new and retrofitted residential and commercial buildings will need to have reflective roofs.

I really like those green roofs where people have planted grass and plants to reduce cooling costs.  But reflective roofs accomplish much of the same thing and you don’t need to mow them.  Now that’s win-win.

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Filed under Climate Change, Daniel Durazo, Green Marketing

The Birth of “Drive to Mobile”

You may be familiar with the term “drive to web.”  It refers to any activity that drives someone to log onto a website.  In marketing, this is done through a variety of media vehicles.  A television ad, a radio spot, a newspaper ad, a billboard or even an airplane dragging a banner at the beach, may include a url in an effort to “drive” the targeted audience to a particular website.  The internet itself is the best drive to web medium because the intended target is already on the web and simply needs to click a banner, button or link to be directed to the desired website.

I’ve been working on developing mobile marketing strategies for clients and potential clients and have recently spoken with a couple of vendors in that space who have walked me through the mobile landscape.  

The mobile marketing industry is set to explode.  eMarketer says mobile is today where web was ten years ago.  They predict that global mobile message advertising will be a $14 billion business in 2014, up from $2.5 billion today.  Strategy Analytics expects worldwide mobile advertising spending to more than double from 2008 to 2009, increasing from $1 billion to $2.4 billion.

Given the huge potential of mobile advertising, it makes sense to develop strategies to “drive to mobile,” just as we have developed strategies to “drive to web.”  While all of the options used to drive to web can certainly be used to drive to mobile, there are two advantages that mobile marketing has over other types of marketing that can and should be exploited.

First, mobile marketing is the perfect opportunity to tap into micro attention spans (guilty!) and engage people wherever they are, no matter what they’re doing.  If I’m driving, sitting in a stadium waiting for a sporting event or show to start, or even just eating lunch, my options to respond to a marketing message are limited.  Typically, I’ll do nothing, hoping that I remember the message at a later time.  With mobile marketing, stadium sitters will see a message on the jumbotron inviting them to text a word to a “short code,” a 5 or 6 number text address, and then automatically and immediately receive a coupon, enter a contest or be directed to a mobile website.  The upshot for the consumer is immediate gratification, something we all love.  The benefit to the advertiser is that there is no lag time between exposure to the message and the time when action is taken, a lag time that may cause the target to lose interest or forget the message entirely.

Second, mobile marketing is perhaps the mother of efficient marketing communications.  Most marketers are forced to blast their messages out day after day in the hopes those messages will just happen to intersect the consumer making that infrequent decision to buy a car, find health insurance, look for a new job, search for a house, etc.  Because advertisers are using a mass market approach to find a needle in a haystack, most of the marketing effort is wasted and the process is incredibly inefficient.  Mobile marketing allows advertisers to push messages only to those consumers who are in that searching mindset and then (this is the cool part) provides that consumer with an advertisement that they can then carry around inside their phone indefinitely, referring to it when the buying decision is upon them.  Oh, yeah.

Drive to Mobile:  You heard it here first.

UPDATE:  A new study from Nielsen Mobile finds that text messaging is now more popular than calling. Cell phone users report that they are sending nearly twice as many text messages per month than they are making calls.

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Filed under Daniel Durazo, Mobile Marketing

A PR Person with a Sense of Humor?!

Almost every organization on the planet does something boneheaded and ill advised from time to time. The bigger the organization, the more likely it is to happen.  When the perpetrators of these errors in judgment are committing these crimes of idiocy, they seldom check with the organization’s PR person to get their opinion before they commit the act. But once the media gets hold of the story and runs with it (corporate idiocy being one of their favorite topics) everyone scrambles to the poor PR pro to make it go away.

I think that many of the PR people (especially you corporate soldiers out there) charged with handling these disasters used to possess a sense of humor about them.  But years of mopping up other people’s messes, particularly those stressful situations where everyone is breathing down your neck, takes its toll and it just ain’t funny anymore.  Thus we’re left with robotic and textbook answers to each and every media inquiry, regardless of the seriousness.  Now where is the fun in that?

It’s odd then that a ray of hope would emanate from the least likely of sources, that being our very own Richmond-based retailer-on-life-support that is Circuit City, and the guy who gets my vote for PR person of the year, Jim Babb.

The backstory is that MAD Magazine ran a parody of the store’s weekly ad that included some unflattering items, such as a Nintendo Wii that was guaranteed to be in stock, “if you’re friends with an employee who hid it in the back for you.”  I personally love that one, because when Wiis first came out I hunted them relentlessly yet unsuccessfully for months until I finally got tired of camping out in front of electronics retailers at 5am and broke down and paid an arm and a leg on eBay.

However, someone who does not subscribe to the theory that all PR is good PR, took such umbrage (and had enough leverage in the corporation) that they had all of the offending MAD Magazines sold in Circuity City stores removed from the shelves.  I’m sure they then said, “Not laughing anymore, are we Alfred E. Newman?”  In PR circles, that type of stuff is the equivalent of waving a big flag in front of journalists that says, “Corporate Idiots Ban Unflattering Media, Please Write About It.”  Not only was it a dumb move because it brought so much more attention to MAD than MAD would have ever received on its own, but the media loves these “book burning” types of stories so much they find them completely irresistible.  

Such was the case with Circuit City and its MAD debacle.  So what’s a PR superhero to do?  Why, laugh of course!  And that was the response of CC’s Jim Babb who (take notes kids): 1) Apologized for the error in judgment, 2) corrected the error by returning the magazines to the shelves, and last, but certainly not least, 3) made a joke out of it.  Jim said, “As a gesture of our apology and deep respect for the folks at MAD Magazine, we are creating a cross-departmental task force to study the importance of humor in the corporate workplace and expect the resulting powerpoint presentation to top out at least 300 pages, chock full of charts, graphs and company action plans.”  He also offered the editors at MAD a $20 gift card toward a Wii.  

John Ficarra, MAD’s editor, played along by saying, “We at MAD were shocked and confused by this entire incident — mainly because we had no idea that Circuit City even sells magazines.”

A job well done:  Jim Babb got CC out of the jam and even put the company in a positive light by showing that it may indeed have a rare sense of humor and MAD got more publicity than they could have ever dreamed of.  

Class dismissed.  Now go out there and laugh!

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