By Patrick Di Chiro
President and CEO, THUNDER FACTORY, Inc.
In the numerous post mortems that followed the
bursting of the Internet bubble (It didn't "change everything"
after all), one factor was usually overlooked as being key to the
Net economy's demise: The fact that management, investors and industry
pundits too frequently confused "spin" with "strategy."
This is nothing new for marketers, who have been confusing spin
with strategy for many years now.
There is a world of difference between spin and strategy. Spin
is about superficial trends, "buzz," nonexistent planning,
very little focus, and continual changes in direction. Strategy
is based on rigorous planning, long-term value, making the hard
decisions, focusing like a laser beam, and consistency over time.
In recent years, marketers have been increasingly satisfied with
taking the strategic path of least resistance - they have been adopting
spin tactics rather than doing the hard work to come up with a strategy.
One doesn't have to look too broadly to discover some poignant
examples of how spin has permeated every aspect of our business
and marketing thinking.
Marketing's 30-Year Spin Cycle
Some would argue that the entire Internet economy was a triumph
of spin over strategy. Clearly, it was not our finest hour as marketers.
It was a time when spin virtually replaced strategy. A time when
marketers actually believed that you could "build a brand"
by blowing half your annual marketing budget on one Super Bowl commercial.
Or, by getting your CEO mentioned a few times in the now defunct
and forgotten Industry Standard.
Michael E. Porter, the Harvard Business School professor, who is
one of the world's foremost thinkers on business strategy, discussed
the decline in the use of strategy in a March 2001 Harvard Business
Review article entitled, "Strategy and the Internet."
Porter commented: "Many of the pioneers of Internet business,
both dot-coms and established companies, have competed in ways that
violate every precept of good strategy. Rather than focus on profits,
they have sought to maximize revenue and market share at all costs,
pursuing customers indiscriminately through discounting, giveaways,
promotions, channel incentives, and heavy advertising."
The truth is that marketers began emphasizing spin over strategy
long before anyone had ever heard of the term "first mover
advantage." The seeds of this trend were planted in the 1960's,
during the first major creative revolution in the advertising/marketing
industry. This period is rightfully characterized by many as a Renaissance
in the advertising business. It brought intelligence, light and
humor to a business that too often treated consumers as if they
But, there was a dark side to this creative enlightenment. The
positive changes of the '60s led to a second creative revolution
in the 1970's. Born in San Francisco and L.A, the second creative
revolution is best known by its oft-repeated mantra, "It's
all about the work."
The "work" stood for the creative output, which itself
became the hero and the end game. Not the product, or the client,
and certainly not the marketing strategy. In this new spin-focused
approach to marketing, the primary goal was to entertain and impress.
Selling and building strong, value based relationships with customers
and other stakeholders took a back seat.
To be sure, strong creative is a fundamental part of good strategic
execution. Effective strategy engages customers, keeps their attention
so you can deliver a persuasive message, and hopefully changes their
behavior in a positive way. You cannot accomplish that by boring
people. But, a marketing-advertising approach that principally emphasizes
entertainment, mind share and buzz, is not destined to build long-term
success. And definitely not profits. That takes strategy, not spin.
Spinning a "Press Release-a-Day"
At the height of the Internet craze, CEOs of hot public dot coms
were known to instruct their marketing and communications staffs
to issue a "press release-a-day." They believed that the
quantity, not necessarily quality, of these releases would create
the impression that their companies were dynamic, growing and successful.
Never mind that the vast majority of their releases had no value
whatsoever. In fact, a common complaint amongst Wall Street analysts
and reporters was that the only thing these companies were winning
was the "press release war."
The dot com CEOs readily admitted that their daily press release
edicts were solely about spin, and had nothing to do with business
strategy. But they adamantly stuck to this practice because they
believed it generated the desired results - boosting their stock
prices and creating the all-important buzz.
The real problem for these Internet companies and their shareholders
was that their buzz-loving CEOs ultimately confused spin with strategy.
CNBC was crowded everyday with glib CEOs who exhibited a dangerous
habit of seizing the trend du jour and promoting it with an almost
religious fervor. Their strategic zig zagging not only hurt productivity,
competitiveness and employee morale, it wasted a huge amount of
money in the process. Shareholder value quickly went out the window.
Several of these CEOs continue to confuse their spinning with having
a real strategy. Evidently, they are hoping they can attract a buyer
before their companies simply collapse from too much spin.
Strategy Edges out Spin in Presidential Politics
The term spin was actually coined in the political realm, and it
has been enthusiastically practiced there ever since. The original
"spinmeisters" were the political operatives who tried
to gain competitive advantage for their clients by devising poll-driven
messages - and even policies -- that purported to tell voters what
they wanted to hear.
The good news is that strategy still does win the day, even in
the spin-centric political world. Leaving aside the controversies
of the 2000 presidential race, few would disagree that then Governor
George W. Bush won the strategy war of the campaign. Many believe
that Vice President Al Gore lost by his over reliance on spin.
From the beginning of his campaign, Bush established a clear strategy
and deceptively simple messages to communicate his positions. He
then did something that seems almost revolutionary these days: He
consistently stuck to them throughout the campaign.
Whether or not you agreed with candidate Bush, you knew where he
stood. More importantly, his steadfast adherence to his strategy
and messages painted the picture of a disciplined, straight talking
and even principled politician. One who knew what he wanted to do,
and where he would lead the country.
In stark contrast, Vice President Gore was all over the map in
campaign 2000. He constantly changed his strategy, and key messages,
and thus reinforced a perception that he was just another superficial
politician who did not really have any guiding principles. Someone
who would "do or say anything to get elected." As such,
whether by design or through lack of discipline, Vice President
Gore's campaign was essentially run on spin, not a core strategy.
The final result reinforced again the power of strategy over spin.
Sparking a New Strategy Revolution
What the marketing industry needs today is a new strategy revolution.
In this revolution, the "work" would serve to support
the strategy, not the other way around. Spin would just be another
tactic in a comprehensive strategic plan. Like the original creative
revolution of the '60s, this new strategy revolution would reclaim
the true business-building legacy of the marketing profession. It
would be built on the following strategic marketing tenets, all
pillars of proven business strategy:
Make the Tough Choices - Strategy
is not about doing everything - it's about making hard choices
and trade-offs, that differentiate and help drive competitive
Focus on Profitability
- Growth, market-share and mind-share are all great, but, without
profits, businesses die. Marketers must develop strategies that
drive the bottom-line as well as the top-line.
Deliver Real Value -
This should be tattooed on every marketer! If you develop and
deliver a product and an experience that has real value, you
can charge a fair price for it. That helps to build brands,
and leads to profits and success. It has nothing to do with
Listen to the Customer
- This seems self evident, but it's forgotten all too frequently.
Building an effective marketing strategy is, first and foremost,
a bottom's up process, not top down. Learn first what your customers
really want and need, and then plan from there.
Define Your Unique Value
Proposition - The essence of strategy involves developing
a differentiated value proposition that drives competitive advantage.
If you're having problems doing so, start over. No amount of
spin, or marketing budget, will take the place of a strong value
Be Consistent - As marketers
we all know that brands are earned over time. They are not bought
- even with expensive advertising campaigns. But, that doesn't
stop marketers from trying. To succeed in the long run, you've
got to take the time and do the hard work to build a strategy,
and then stick to it.
Great companies know that lasting business success comes
from having a strategy that is refined, reinforced and followed consistently.
If you are willing to do the hard strategic work - and avoid the pitfalls
of confusing spin with strategy - you too can build a business franchise
that stands the test of time and competition.