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Why blogs matter in marketing

The validity of blogs alongside the mainstream media is no longer a matter for debate. Valued by a critical mass of the public, and frequently a key source for journalists, they have proven their worth as a way to access naked facts and opinion on all kinds of subjects – especially those that the mainstream media finds uncomfortable or insufficiently commercial. Undoubtedly the majority of blogs are pretty worthless – dreary musings or firebrand tirades – that call for circumspect reading. Yet, within this gloomy miasma that constitutes the so-called ‘blogosphere’, the good ones shine out like beacons. Those of us in marketing communications ignore them at our peril.

There are some startling examples of how bloggers have contributed to creating a better understanding of reality. Fascination with the words of the Baghdad Blogger, who wrote about Iraqi life during and after the war, led to its author, known as Salam Pax, becoming part of the mainstream media himself. A regular column in The Guardian newspaper and a video diary series produced for the BBC’s Newsnight programme were won out of respect for his clear and frank coverage of life in Baghdad under Saddam, under invasion and under occupation. This article from BBC News Online, written by world affairs correspondent Paul Reynolds, highlights how blogs have been significant in other major news events, such as the Danish cartoons scandal, Hurricane Katrina and the demise of CBS’s Dan Rather.

Reynolds’ article gives evidence of the power of the blog, and he ends his piece with the crucially important point that the criticisms of bloggers cannot be disregarded. He comments, “If the mainstream media does not respond, it will suffer. The same is even truer of businesses, whose products can be disastrously damaged by web-based attacks.” SwelledHead could not agree more. Appreciating that the reading public is more than capable of sifting facts and considered appraisal out of conjecture and biased opinion, it is vital to recognise that the onus is on those potentially open to attack to keep aware and respond accordingly if necessary.

Blogs and marketing

Marketing, and more specifically public and media relations, is business’s front line in engaging with the blogosphere. It is unquestionably more difficult to handle than the mainstream media, but that’s the nature of the beast. A particularly worrying example of the failure of PR to cope with its new nemesis came to me while reading one of my favourite blogs, The Truth About Cars.

This is a blog that does what it says on the tin. Founded by an outspoken freelance motoring journalist in the US, the site carries bluntly honest vehicle reviews and ingenuous commentary on the automotive industry. A recent post, with an appeal to manufacturers that have barred access to press demo cars, disclosed the difficulties created by an ethos of absolute sincerity. The mainstream yet invigoratingly outspoken British motoring journalist, Jeremy Clarkson, irreverently summarised the problem in The Sunday Times:

    “Most young car journalists are paid less than £15,000 a year, which means they have barely enough money left at the end of the week to buy food. And yet, each week, a brand new car is delivered to their house, full of fuel and insured. What’s more, twice a week they will be flown, first class or on a private jet, to Florence or Tokyo or wherever. Here they will stay in a 38-star hotel where they will be showered with tasty morsels and refreshing wines. The next day, after driving the new car through some lovely scenery, they will have a £150-a-head lunch and then board the jet for home clutching a nice freebie. A laptop computer, perhaps, or some expensive luggage.

     “So, are they going to give up being Elton John by saying something awkward about the car they’ve been driving? Would you? Or would you bend over backwards, or forwards even, to ensure you were on the guest list for the next big global freebie? The car industry PR people know this. They know they have the power. They also know they have the budget to make sure that every single new car, no matter how dull, is guaranteed to get full-page coverage in all the magazines and all the newspapers.”

Bloggers are a challenge to this status quo, taking the power away from the industry and putting it in hands that aren’t in someone else’s pocket. That may be uncomfortable for those in the press or PR, but a truly candid review is of much greater value to a potential car buyer than one tainted by corporate sweeteners. That goes for all manner of products and services, especially where there’s a significant financial or time commitment, or where safety is of importance. Consider the benefit of getting an honest view about the hotel you plan to stay in, the airline that will take you there, or the security of the destination.

Living in the blogosphere

So, what are the lessons that we in marketing need to learn to cope with the bloggers?

One of the first things I was taught as a rookie PR exec was to read the journal that I was pitching. It’s simple, but often receives only scant attention. With blogs, it matters more than ever. It’s vital to truly understand the purpose of the blog and the person or people behind it. In the same way as with mainstream journalists, effort should be made to build a relationship.

Of course, without the support of media databases and intelligence, this can be very time consuming. In an age of fast communications, blogs often move at the speed of an earlier era. That’s not to say they’re slower at reporting – quite the opposite in many cases. The difference is the old-fashioned approach they take to journalism. With a subject close to their heart, they report and opine on what they can see in their world. Being part of that world is essential if you want to increase awareness of your brand, or to contradict criticism you consider unfair. To get around the problem, pick no more than five blogs that matter most – there’s unlikely to be many more than this gaining true public attention. Know them, their writer(s) and understand their audience, and they’ll appreciate your involvement.

One final point, for those who still think that blogs are for the nerdy and their importance pales in comparison to the mainstream media. To be sure, the press and broadcasters are and likely to remain the pre-eminent source of information. Yet, as Paul Reynolds’ article demonstrates, the power of the blog to shape and disrupt traditional news sources is considerable. Whether blogs are affecting public understanding and opinion directly, or through the influence they exert on the mainstream media, the effect is enough that it is inexcusable for those of us in marketing to write them off as trivial. After all, you’re reading one right now.

Watch out Uncle Sam?

Last week’s news that British supermarket giant, Tesco, is to launch a US venture is likely to be one of the most significant transatlantic ventures announced this year. Accounting for an estimated one pound in every eight spent in all of Britain’s retailers, there’s no doubting the achievements that the firm has made in its home market. Yet attempts to crack America have long eluded its competitors. Why does Tesco think it should be any different?

Swelledhead’s view is that answer lies in the firm’s route to UK market leadership. The British supermarket industry is one of the most sophisticated in the world, both in terms of its product mix and supply chain. Once very much an also-ran of the grocery sector, Tesco’s success has been created out of its ability to understand the differing wants and needs of UK consumers, to develop the product lines, services and local retail environments that satisfy these.

Other British supermarkets are also effective at understanding their customers, but with more than a 30% share of the UK supermarket sector it is clear that, on the whole, Tesco is simply better at adapting and reinventing itself than competitors:

• In 1985 it was the first to emphasise health and nutrition of its own-brand products
• Its at-store petrol/gasoline business became the biggest among independent suppliers in 1991
• A lower priced value range was launched in 1993, later followed by a premium ‘Finest’ range
• The pioneering ‘Clubcard’ loyalty scheme was launched in 1995
• Its non-food business accounts for 50% of new retail space in the UK, with sales growing at double the speed of food. In 2005 a trial non-food store was opened.

Act global, think local

This aptitude for transformation is the key to Tesco’s success in entering markets outside of the UK. Here are a couple of examples, taken from the firm’s own international factsheet:

      “In Tokyo, customers like to shop for small amounts of extremely fresh food, every day. Existing hypermarket formats don't meet the needs of local customers, so Tesco's entry into the Japanese market was through the acquisition of a discount supermarket operator.”

      “In Thailand, customers are used to shopping at traditional wet markets, interacting with vendors and rummaging through piles of produce to choose want they want. Rather than adopting the Western approach of neatly packaged, convenient portions, our Rama IV store in Bangkok tries to meet local customers' expectations.”

This second illustration is striking when compared with the experience of that other well-known supermarket behemoth, Wal-Mart. The American firm’s strategy for all markets is to keep prices as low as possible, and it’s proven to be a very successful one. Yet the method failed with the Thai market. The reason was that local consumers preferred the street-market-style stores to which they were accustomed, even if Wal-Mart was a little cheaper. Tesco’s appreciation of the subtleties of local preferences has meant that its business in Thailand has flourished. Today it is its largest market outside of the UK in terms of number of stores and sales area.

Can Tesco adapt to the preferences of US consumers? As with any other market, if it can understand the wants and needs of local consumers – and provide for them better than competitors – there is no ostensible reason why it shouldn’t.

At the moment the company is keeping quiet about the format of its planned US stores. All that is currently known is that the firm will start on the West Coast with a convenience store concept, believed to be something akin to Tesco Express in the UK. Speaking to the BBC, the head of Tesco’s international business, Philip Clarke, said: "We will open some stores and we won't say much about them until we do. Then the customers will walk in and decide.” As the firm’s business expands east from the Pacific, it’s likely that the format will be adapted along the way. In years to come, a Tesco in Connecticut will probably be noticeably different to one in California.

The British bruiser

So, could Tesco beat Uncle Sam Wal-Mart in his own backyard? Discussing the likelihood of Tesco’s success with others, Swelledhead heard several comments that, all else being equal, the size of Tesco’s business in the US will be limited by a local preference for buying American. It’s a good point; US consumers are well known for their patriotism. Yet the evidence is that national partisanship presents little obstacle when the foreign contender has a better offer. Just consider the advancements Toyota has famously made on General Motors and Ford in recent years. Moreover, the manufacturer has been able to counter feelings of national disloyalty by sourcing and producing its vehicles within the US and there is every reason to suppose that Tesco would do the same if it believed that was what its customers wanted.

The size of the US market and the level of competition means that it would take some doing, but on the strength of the Tesco’s success in other foreign markets I wouldn’t bet against it.

Blogathon nets 132 subscribers

In December 2005, Austin Lawrence Group ran a ‘Blogathon’ to recruit subscribers to updates from SwelledHead. With 132 new email addresses added, the project was a great success. Our promise was to donate 10 pence ($0.18) to Cancer Research UK for each new name, but we thought we’d double that to a total of £26.40 ($46.91). Many thanks for your kind support.

Posts that generated the most interest in 2005 included our views on Fortnum & Mason and our Anglophile idea. We also noticed a lot of interest in our remarks about PC World’s comparative advertising against Dell. It's notable that this campaign has continued and expanded, so we’re going to take another look at it in the near future.

We hope you continue to enjoy SwelledHead in 2006. Remember, your feedback is always welcome, so contact us at any time.