The choice: companies “can leap into the future and possibly land on their feet” or wait to be run over by their competition
I have read and reviewed all of Marty Neumeier’s previously published books and thus was eager to read his latest in which he explains how and why “customers now run companies — and how to profit from it.” We all realize that, in recent years, there has been a major paradigm shift that transferred majority control of the purchase process from seller to buyer. I cannot recall a prior time when buyers were better informed, less patient, and more demanding than they are now.
This is what Neumeier has in mind when observing, “The best customers are no longer consumers or market segments or tiny blips in big data. They’re individuals with hopes, dreams, needs, and emotions. They exercise judgment, indulge in whims, express personal views, and write their own life stories. They’re proactive, skeptical, and creative. They’ve reached the top of Maslow’s Pyramid, where the goals are autonomy, growth, and fulfillment. They don’t ‘consume.’ HAVING more runs a distant second to BEING more.” The implications of this “flip” are numerous and of immense significance. The new caution is “caveat vendit” (seller beware) and while it may be implicit, it is certainly emphatic.
To what does the title refer? The aforementioned transition is part of the answer but there are other issues as well. In each of the 18 chapters, Neumeier examines an individual flip — “an accepted business truth upended by technological change. These individual flips add up to the overall flip.” He hastens to add, “Yet this book is not just a description of change, but a prescription for it.” If I understand Neumeier on this point (and I may not), marketing must become so customer-centric that a buyer and the given brand become indistinguishable.
I agree with Neumeier that the term “brand” remains the essence of Peter Drucker’s assessment that (a) business has only one valid purpose: to create a customer; and if so, (b) business has only two basic function s: innovation to produce better products and marketing to tell the stories that sell them.” In fact, Drucker’s vision was for marketing to make selling “superfluous.”
Neumeier lists “10 New Realities” (Pages 8-17) and then shifts his attention to the aforementioned individual flips in sequence. Each suggests one of probably several dozen disruptions of the traditional seller-buyer relationship. He also provides a list of “25 Intangibles That Add Value.” I urge marketers who read this book to use this list to conduct a candid assessment of their own brand whatever it may be…and do so within the framework of the new realities.
These are among the several dozen passages of greatest interest and value to me, also listed to suggest the scope of Neumeier’s coverage:
- 10 New Realities (Pages 8-17)
- 25 Intangibles That Add Value (26)
- The Power of Loyalty (31)
- Anatomy of a Mom Blogger (46)
- Customers: Identity, Aims, and Mores (49)
- The Authenticity Scorecard (55)
- Onlyness Is the Secret of Positioning (60)
- Ritz-Carlton Service Values (67)
- Touchpoint Menu (72)
- Brand Experience Map 78)
- What Can You Fix? (82)
- The Seven Enemies of Simplicity (102)
- Purchase Funnel (121)
- Brand Commitment Scale (125)
- Brand Commitment Survey (126)
- Take-Home Lessons (131-133)
Who will derive the greatest benefit from this book? Although the target market may seem to be marketers, that would be an incorrect assumption. I propose three working assumptions. First, that all organizations need effective leadership at all levels and all areas of the given enterprise. Next, that the healthiest organizations have a workplace culture within which personal growth and professional development are most likely to thrive. Finally, that as Peter Drucker suggests, the most successful organizations will produce better products and/or services [begin italics] perceived by their customers [end italics] to offer the greatest value in combination with a purchase experience that is [begin italics] perceived by their customers [end italics] to be most convenient and most pleasant.
Those who will derive the greatest value from this book will probably be in one of two groups: those in companies annually ranked among the most highly regarded and best to work for as well as most profitable with the greatest cap value in their industry, and, those who aspire to be associated with a such company.
The stakes are high, as Neumeier indicates:
- The most loyal 50 percent of customers would pay a 25 percent premium before switching brands.
- Loyal customers spend 33 percent more than new customers.
- The probability of selling to a new customer is only 5-20 percent, whereas the probability of selling to an existing customer is 60-70 percent.
- Customers have an emotional connection to a company are 4 times as likely to do business with it.
- In many categories, the most loyal 10 percent of customers generates 50 percent of the revenue.
- In some sectors, a 2 percent increase in loyalty is equivalent to a 10 percent cost reduction.
- A 5 percent increase in customer retention can mean a 30 percent increase in profits.
- A 5 percent increase in loyalty can mean a 95 percent increase in profits over a customer’s lifetime.
I think this is Marty Neumeier’s most valuable book…thus far. His insights and counsel will have wider and deeper impact because they have wider and deeper relevance to any organization, whatever its size and nature may be. THE BRAND FLIP is a brilliant achievement. Bravo!