Tuesday, July 26, 2011

Cough, Cough - MABUSHI in the Consumer Package Goods Space

WARNING: This is a Grumpy-gram.  This kind of MABUSHI is yet another example of how marketers get lumped into the slimeball, low-life, scourge of the earth category.

Two weeks ago my son brought home a nasty summer cold and couldn't sleep at night.  Off to the medicine chest to see what we had.  He was in Cub Scout camp all day long so he needed to sleep at night.  The selection at right is what we had.  I settled on the Children's Tylenol in the end because it was multi-symptom and he got the rest he needed.

What got my blood boiling was the deception in the packaging.  The contents of over the counter cold remedies are all the same (read the labels) so the CPG companies spend a lot of time and money on brand awareness and perceived value - and I'm okay with that.

What I'm not okay is with this garbage, especially from Delsym:

 Big package.  "New Family Size" All implying that I'm going to get more for my money.  What I got was a box that takes up twice the cupboard space and a single fluid ounce more than the Tylenol.  One OUNCE!

Anyone with kids knows that one more ounce is not going to provide much more value as you can blow through a bottle in a few days.  I wonder what the Product Manager and Product Marketing Manager were thinking when they proposed new tooling to build the bigger box, rejiggering the production line to handle the bigger bottle and then requiring their channel to fundamentally change their shelving to accommodate this deception.  I don't know but it leaves me with a bad impression of Delsym.  I'll just stick with the house brand generic stuff from here on.

As marketers, we need to call "Hogwash!" (or your other favorite invective) when we see things like this proposed and kill them off before they see the light of day.

Do you have any examples like this you'd like to share?  As the CPG space is too easy of a target, I'm most interested in FISERV, hi-tech and other areas.

Key Take Away:
  • Ensure the value delivered matches the value promised.
Please join me Monday, 8-August at 4PM PDT on the Global Product Management Talk tweetup.  I'll be going through these questions and looking for your input.  Let's elminate MABUSHI.
  • What are the two must-ask questions in your PMM toolkit?
  • What techniques do you use to understand the value chain?
  • When is your sales team a customer/persona and when are they a partner?
  • What makes your sales tools REALLY effective and how do you measure that? 
  • What self-checks do you use to eliminate MABUSHI?
  • What are your favorite examples of bad product marketing?

Thursday, July 7, 2011

Time to Change the Channel?

I saw a message today from one of my LinkedIn groups pointing to a McKinsey report by Richard Rumelt talking about how bad strategy is starting to run rampant in business. It's a great read for anybody developing product, company or go to market strategy.  I especially liked the example of International Harvester not identifying it's own strengths and weaknesses in its strategic plan.  The report even comes with a diagnostic kit to help determine if your strategy is on the right track. Yes, you do have to register with McKinsey to get it but the free reports make it well worth it. 

It got me thinking about a conversation I had last with the Sales Engineering director at an accounting software company regarding their plans for growth and competing in a fragmented market.  A big part of their growth strategy is dependent upon leveraging channel partners/resellers.  He was lamenting the fact that his biggest hindrance to channel growth was the cost of enabling resellers. 

Accounting software is a complex beastie and you typically have to have debits and credits in your DNA to be able to sell and support it effectively.  State of the Art Software (now Sage) brilliantly pioneered the use of CPAs as resellers back in the early 1980's and the model is still in use today.  Any number of accounting vendors compete for the attention and love of CPA firms and private practioners.  Some firms are big enough to have practices around several different vendors, many are lifestyle businesses where the owner looks to employ no more than 30 people or so and complains when anything interferes with his regular Thursday golf game.

It's those lifestyle firms my acquaintance was complaining about because he claimed they cost the same to enable as the larger firms but are only going to produce 10% to 20% of revenue as the big firms in a year.  I pointed out that more and more we are known by the networks/communities we belong to rather than the business we work for and perhaps there were communities out there they could turn into profitable and cheaper partner networks.  He seemed to be stuck in thinking the current model was the only model, both in the channel itself and how they enabled their partners because he wasn't receptive to that thought. 

We didn't have time to discuss it further but I came away with a bunch of questions for him that may help him find ways to change his channel:
  • Who else other than CPAs or CPA firms have the expertise, contacts and interest in selling accounting software?  Where do they congregate?  What are their needs (what would they want to get out a partnership)?  What would they need to be successful?
  • In your market segments, where else do your buyer personas go for advice?  Who do they trust and why?  What kind of advice do they need?
  • When was the last time you took a microscope and scalpel to your partner plan and enablement systems?  Do your tiers or segments still make sense?  Which segments are you missing?  What tools are useful?  What do you need?  What do partners REALLY need from your program in terms or resources, materials, etc.?
  • What assumptions about partnering have you validated recently?  How many do you really need?  Do you have the right tiers?  Do need more or fewer?  How can you automate the acquisition and enablement of your partners?  Which existing partners are paying their way?  How many are resource-drains and why haven't you dumped them?  Do you have a plan or procedure for dumping them?  Why not?
A lot of these questions are really for your channel folks but are also core to what us product marketers should be doing.  Our responsibility is to ensure we have the right channels and tools to reach the customers we want.   If you're not thinking this way, your strategy may be flawed.  If you're not regularly asking these questions your channels are not running optimally.

Key Take-aways:
  • Always question the value and efficiency of your systems.
  • Regularly review the assumptions that went into your plans and validate them 
  • Be open to accepting that your assumptions may be wrong or things may have changed to make them no longer valid.
  • If your channel isn't right, change it.

Next Up: Another Grumpy-gram for our Consumer Packaged Goods brethren