Sounds counter-intuitive doesn't it, but it's absolutely true. Great marketing can simply ruin a low-quality or even good-quality product or service. Before you dismiss this post on its face, let me offer an example we can all relate to.
Banking in the 00s has become a "Gotcha Marketer's" paradise. Sky-high ATM fees, bank fees, huge conglomerates with no ties or interest in the community. It's all pretty discouraging.
According to Bart Narter, senior vice president at Celent, a banking industry research firm, "Overdraft charges, in particular, generate customer steam. Fee income, primarily from bounced checks and overdrafts on debit card, account for close to half of all bank profits."
So while banks have been running brilliant marketing campaigns with spectacular offers like "Free Checking," "24-hour online banking" and "no minimum balance", the joke is on each and every one of us. Big banks simply can’t live up to their own hype and still turn the kind of profits their investors demand.
A recent J.D. Power and Associates survey reports that satisfaction with banks in general, out of a possible score of 1,000 points, is now at a level of 748. That's down slightly from 763 three years ago. But what has really plummeted is loyalty. In the 2007 survey, 46% of customers said they "definitely" would not switch banks in the next 12 months. That figure has fallen to only 34% of customers in 2010, which represents a 26% decline.
So while great marketing can win you new customers, it's how you deliver your product or service that ultimately retains them. Let your marketing promise the stars and you will only disappoint those hard-won new customers.
These days, the economy is far more scary than ghouls and goblins, but that didn't stop Americans from embracing the (expensive) delights of Halloween.
This year, U.S. adults spent about $5.77 billion to celebrating Halloween, according to the National Retail Federation, up from $5.07 billion in 2007. Who says cobwebs can't stimulate the economy?
That's good news in an otherwise grim economic outlook. The Commerce Department said last week that Gross Domestic Product, shrank by 0.3 percent in the third quarter, largely due to sharp declines in consumer spending. This leaves little doubt with economists that we're in a recession that may be long and deep. However, on the heals of Halloween retailers are reporting far more treats than tricks.
Contrary to the grim picture economists are touting, the "Halloween Consumer Spending Index" seems to be up from last year which may signal, an albeit slow, domestic economic recovery.
NPR wrote a whole article last week, "In Tricky Economy, Halloween A Treat For Retailers." We'll have to wait and see if the holiday spending spree carries over through the "golden quarter."