Multinationals: Lessons from McDonalds

In a recent post, I explained the problems in the search industry on international expansion. For instance, a UK vendor spent hundreds of thousands of dollars without signing a single US client, while a US vendor did the same thing in the UK. What gives? How do companies get it right? Let’s look no further than that iconic American hamburger vendor, McDonalds.

Look at the Big Tasty burger. Never heard of it? Just to to Brazil, Portugal or Italy to pick one up. It was dreamed up in a test kitchen in Germany and then tweaked, trialed and launched in Sweden in 2003, where it was a huge success. But to quote Fortune, the Big Tasty has become more than a giant burger: It is a prime example of how, in this era of global business, the tail can end up wagging the dog. 

Yet, as McDonalds has been discovering, running a successful global company requires some significant changes in corporate behavior. Going “glo-cal” as management consultants like to call it, requires striking a balance between managing a brand on a consistent basis and appealing to different tastes (culture) in dozens of markets. It means delegating authority and letting things happen; it is not a job for control freaks.

McDonalds also has clear rules on where the limits lie. Country managers can create their own campaigns but cannot fiddle with the logo.

As the article points out, this is not easy to do. What’s hard is creating a culture, corporate structure and work environment that fosters innovation whereever it takes place. “It takes a high degree of sophistication to do something like that.” says Till Vestering, who runs the Singapore office for Bain and Co.

Learn lessons wherever you can. You can learn a lot from a burger company.

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The looming shakeout in search marketing business

If there is one thing I’ve learned in decades of business, it is this: 


There is no such thing as long-term easy money.

Let’s look at some past “sure things” — in which we were told the money was easy:

  1. “Housing prices are going to go up and up. You’ve got to buy ASAP.” (As recently as 2007)
  2. “Tech prices are going through the roof. Buy now or you’ll miss out.” (Late 1990′s)
  3. “Hedge funds are a license to manufacture money.” (Until this Spring)

Now I hear from CEO’s of search marketing firms “We’ve grown x hundreds of percentage points in the last three years. We’re doing great.” 

Well, I’ve got news for you — within three years eight out of ten of you will be bankrupt or purchased. While that seems dire, let’s look at the reality:

Easy money breeds competition just like food scraps draw ants. 

As I have observed, one cannot swing a cat today without hitting four or six search marketing firms. Picture a massive explosion of search vendors chasing a finite number of prospective customers.

Look at the naive marketing approaches of search marketing firms. Nearly all are run by technology geeks.  Browse through their websites and you will find they all say the very same things.  Almost all are very product centric — with “post and pray” websites and they hire “smile and dial” salespeople.   (See earlier post on why the founders sell and no one else can.  This is a symptom of bad management.)

Keep in mind that all of these search firms are calling the same prospects with the same product, product, product messaging.  Prospects are fed up. Something has GOT to give.

Someday, someone in the search marketing industry will awaken and say “I’m mad as hell and I’m not going to take this anymore.” 

They will focus on customer-centric marketing, business value and they’ll retrain all their salespeople. They’ll redo their websites and start tracking Digital Body Language. They’ll finally get “demand generation.”  

But the vast majority won’t and they’ll go the way of the dinosaur.

Good luck and good selling. http://www.jeffreyogden.com/

Business is booming, so what ails the Search Marketing business?

  1. A UK SEO firm tries for three years, spends $200,000 in the US and signs zero clients — failing an unbelievable four times in a row. Their entire US sales team departs.
  2. eVisibility spends $150,000 in the UK and produces a handful of sales.
  3. DidIt fires their entire sales team.

What is going on? Why do young, hot companies in a fast growing market struggle so?

In such a young business, most all of these firms are founded and run by entrepreneurs — not professional managers. But the crux of the problem is simple. They stink at sales and marketing.

Let’s point to a few examples that I’ve observed:

  1. Websites are very slick, but all are “Post and Pray” We simply hope someone finds our website. There is little to no educational content and not a single Search Marketing vendor I could find has something as simple as a Call Me button.
  2. Websites talk, but is anyone listening? If a hot propect is on the website, no one knows.
  3. Sales is “smile and dial.” Get the sales people to call more. (Greenlight used Cisco phones so the CEO could track the number of calls placed.) This is naive and archaic.
  4. Product marketing is mostly product, product, product. After I worked diligently to turn my company into a business value, customer centric organization, our Chief Marketing Officer undid my hard work and turned the company into a classic product-first company. (Required PR firm to send press releases on products.)

I took over the US for a UK SEO firm and and the CMO directed me to past presentations stored on a network drive. Raring to go, I opened one — product. I opened a second — product. I opened a third — product. All were very slick, but I instantly saw the source of their lack of success. There was no customer centric content! There was nothing whatsoever about the client. Unfortunately, no one wanted to listen to bad news.

So what does the CEO of a search marketing vendor do? I have a few suggestions:

  1. Identify your ideal customer. What does the customer look like? What events do they attend? Go where they go — not AdTech or SES-NY — unless your customers are there.
  2. Create some value propositions. What is the business outcome that you deliver? What are your measurable results? Make sure salespeople can talk about it.
  3. Develop a strong target customer database. Use tools like TheListInc.
  4. Micro target your customers. Consider vertical marketing programs. (Example: RevPAR stands for Revenue Per Available Room and is the top metric in the hotel industry. A UK SEO’s top market is travel. So I asked the CMO if she had heard of the term. She said “No.” How can a company so focused on travel not know the top metric term?)
  5. Focus on a buying process
    Another example: I recommended to a CEO that he develop a White Paper. He refused. On our own, we developed one for the hotel industry. Results blew away expectations. I asked the man writing it how many executives rejected his contacts. He said “zero.” Companies would kill for 100% response rate.)
  6. Talk to people the way they want to be talked to.
  7. Empower salespeople. Develop pain sheets, voice-mail scripts and email templates and more.

Good luck and good selling. If your firm is looking for Sales and Marketing Leadership, just call or write.

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