The NFL Has A Bigger Problem Than Kneeling Employees – Demographics and Trends

The NFL Has A Bigger Problem Than Kneeling Employees – Demographics and Trends

LANDOVER, MD – SEPTEMBER 24: Washington Redskins players link arms during the national anthem before their game against the Oakland Raiders at FedExField on September 24, 2017 in Landover, Maryland. (Photo by Patrick Smith/Getty Images)

A recent top news story has been NFL players kneeling during the national anthem.  The controversy was amplified when President Trump weighed in with objections to this behavior, and his recommendation that the NFL pass a rule disallowing it.  This kind of controversy doesn’t make life easier for NFL leaders, but it really isn’t their biggest problem.  Ratings didn’t start dropping recently, viewership has been declining since 2015.

NFL ratings stalled in 2015

NFL viewership had a pretty steady climb through 2014.  But in 2015 ratings leveled.  Then in 2016 viewership fell a whopping 9%.  During the first 6 weeks of the 2016 regular season (into early October)viewership was down 11%.  Through the first 9 weeks of 2016 ratings were down 14% before things finally leveled off.  Although nobody had a clear explanation why viewership declined so markedly, there was widespread agreement that 2016 was a ratings crash for the league.  Fox had its worst NFL viewership since 2008, and ESPN had its worst since 2005.

Colin Kaepernick kneels 2016, CNN photo

Interestingly, later analysis showed that overall people were watching 5% more games.  But they were watching less of each game.  In other words, fans had become more casual about their viewership.  People were watching less TV, watching less cable, and that included live sports.  And those who stream games almost never streamed the entire game.

And this behavior change wasn’t limited to the NFL.  As reported at Politifact.com, Paulsen, editor in chief of Sports Media Watch said, “it’s really important to note the NFL is not declining while other leagues are increasing.  NASCAR ratings are in the cellar right now.  The NBA had some of its lowest rated games ever on network television last year… It’s an industry-wide phenomenon and the NFL isn’t immune to it anymore.”  So the declining viewership problem is widespread, and much older than the recent national anthem controversy.

Live sports is not attracting new, younger viewers

Magna Global recently released its 2017 U.S. Sports Report.  According to Radio + Television Business Report (RBR.com) the age of live sports viewers is scewing older.  Much older.  Today the average NFL viewer is at least 50.  Similar to tennis, and college basketball and football.  That’s second only to baseball at 57 – which was 50 as recently as 2000.  But no sport is immune. NHL viewers are now typically 49.  They were 33 in 2000.  As simple arithmetic shows, the same folks are watching hockey but few new viewers are being attracted.  Based on recent trends, Magna projects viewership for the Sochi Olympics and 2018 World Cup will both decline.

I’ve written before about the importance of studying demographic trends when planning.  These trends are highly reliable, even if boring.  And they provide a lot of insight.  In the case of live sports watching, younger people simply don’t sit down and watch a complete game.  Younger people have different behaviors.  They watch an entire season of shows in one day.  They multi-task, doing many things at once.  And they prefer information in short bursts – like weekly blogs rather than a book.  And they are more interested in outcomes, the final result, than watching how it happened.  Where older people watch a game play-by-play, younger people simply want to know the major events and the final score.

To understand what’s happening with NFL ratings we really don’t have to look much further than simple demographics — the aging of the U.S. population — and the change in viewing behavior from older groups to younger groups.

Unfortunately, according to a recent CNN poll, while 56% of people under age 45 think the recent demonstrations are the right thing to do, 59% of those over 45 say the demonstrations are wrong.  In its “core” NFL viewership folks don’t like the kneeling, so it would appear the NFL should heed the President’s advice. But, looking down the road, the NFL won’t succeed unless it finds a way to attract a younger audience.  With younger people approving the demonstrations NFL leadership risks throwing the baby out with the bathwater if they knee-jerk control player behavior.

Understanding customer demographic trends, and adapting, is crucial to success

The demonstrations are interesting as an expression of American ideals.  And they are gathering a lot of discussion.  But they are not what’s plaguing NFL viewership.  Today the NFL has a much bigger task of making changes to attract young people as viewers.  Should leaders shorten the game’s length?  Should they change rules to increase scoring and create more excitement during the game?  Should they invest in more apps to engage viewers in play-by-play activity?  Should they seek out ways to allow more gambling during the game?  Whatever leadership does, the traditions of the NFL need to be tested and altered in order to attract new people to watching the game if they want to preserve the advertising dollars that make it a success.

When your business falters, do you look at long-term trends, or react to a short-term event?  It’s easy for politicians and newscasters to focus on the short-term, creating headlines and controversy.  But business leaders have an obligation to look much deeper, and longer term.  It is critical we move beyond “that’s the way the game is played” to looking at how the game may need to change in order to remain relevant and engage new customers.

Note how boxing recently brought in a mixed martial arts fighter to take on the world champion.  The outcome was nearly a foregone conclusion, but nobody cared because it brought in people to a boxing match that otherwise would not have been there.  If you don’t recognize demographic shifts, and take actions to meet emerging trends you risk becoming as left behind as cricket, badminton, horseshoes, bocce ball and darts.

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Colbert Beat Fallon By Following Trends, Which Will Make CBS More Money

Colbert Beat Fallon By Following Trends, Which Will Make CBS More Money

Photo: NEW YORK, NY – FEBRUARY 19: Writers and crew of ‘The Late Show with Stephen Colbert’ attend 69th Writers Guild Awards New York Ceremony at Edison Ballroom on February 19, 2017 in New York City. (Photo by Nicholas Hunt/Getty Images)

The Late Show hosted by Stephen Colbert is now the #1 program in late night television.  This come-from-far-behind change in market leadership, overtaking The Tonight Show hosted by Jimmy Fallon, is not about politics.  It is about understanding trends and using them to create value.

Back in February, 2014 there was real concern about the future of late night television.  Audiences had peaked decades before, when Nightline was huge and competed with The Tonight Show hosted by legend Johnny Carson. By 2014 many wondered if American programming after the late news was all shifting to cable TV as audiences continued shrinking.  Producers replaced Jay Leno with Jimmy Fallon in order to revitalize viewers.  Jimmy Kimmel was moved up in time as ABC killed Nightline, hoping he could carve out a growing niche.  And David Letterman, late night’s senior statesman, was about to be replaced by cable satirist Stephen Colbert.  But these changes gathered little industry interest, because the time slots simply were not doing well for broadcasters – or advertisers.

Fallon maintained a dominant lead in the time slot as Colbert’s first year was a yawner.

As TheWrap.com reported in September, 2016, despite the fanfare of Colbert taking over hosting, he “posed no threat whatsoever to Jimmy Fallon.”  Fallon’s show maintained a huge lead. With 3.65 million viewers it bested The Late Show by over 800,000.  Colbert, with 2.82 million viewers seemed mostly trying to keep a lead over Kimmel’s 2.3 million viewers.
But, as the New York Times headlined on May 17, 2017 “Jimmy Fallon Was On Top of the World. Then Came Trump.”  During 2016 viewers were engaged in the knock-down-drag-out political battle for the Presidency.  In an effort to build on political interest, Fallon’s producers invited Donald Trump on the show.  Unfortunately, most people viewed Mr. Fallon’s interview as fluff, and given the heat of the rhetoric the critics tore into Fallon hard for an interview that fell far short of its possibilities.  Some considered it a turning point, an interview from which Fallon has yet to recover his full audience following.
jimmy fallon inteviews trump 2016 Getty
ANDREW LIPOVSKY/NBC/NBCU PHOTO BANK VIA GETTY IMAGES

Meanwhile the producers at The Late Show kept their eyes on the mood of the electorate.

They had largely let Colbert promote Democrat Clinton, and even though she lost the election noted she had won the popular vote.  As Colbert continued to criticize the President, his audience grew.  Soon, Colbert was beating Fallon in total audience – something nobody predicted just a few months earlier.  It was quite a surprise when the 2016-2017 September to May season drew to a close and it was discovered that Colbert actually won the time slot, producing a larger total audience than Fallon.  It was only about 20,000 – but it was a win few saw coming.

The Late Show writers and producers noted the historic and growing unpopularity of President Trump, and the public interest in ongoing investigations, and built the headlines into the show.  Variety headlined on 7/25/17 “Stephen Colbert’s Russia Week Lofts Late Show to Biggest Weekly Win Ever.”  Using audience trends The Late Showdevoted a week to a comical look at Russia, which saw it generate a 2.87million total audience in comparison to The Tonight Show‘s 2.42million – a beat of a whopping 450,000 viewers.

late show hillary 2017 CBS
Photo: CBS
Continuing to evaluate what interested the public, producers brought on losing candidate Hillary Clinton, long supported by the show, to create Colbert’s largest audience since launch.  The next night they brought on President Trump’s former Communications Director, Republican and Trump supporter Anthony Scaramucci, to an even bigger audience.  By August 4 Colbert bested Fallon by 900,000 viewers for its biggest weekly win ever, and Colbert was clearly the summer winner with an audience growing at 11% while competitors were losing viewers.

All of this is very good news for CBS.

NBC (NBC/Universal is a division of Comcast) is not losing money on The Tonight Show.  And in the desirable segment of those age 18-49 Fallon still has the largest audience.  But, it is a good thing for CBS to have so many new viewers.  It brings in more advertisers, and higher revenues for each ad.   This leads to more profits.

One might say that this is all about the hosts, and their political leanings.  Maybe the content is driven by host opinions.  But CBS is winning viewers because it is following trends, and matching its programming to trends.  This is growing its late night audience, while NBC’s is shrinking.

Steve Burke, chief executive of NBC Universal was quoted in the New York Times saying “I think the answer is for Jimmy to be Jimmy.”  Sounds like what a father might say about his son when the boy finds himself in a rough patch.  But I’m not so sure its the position a company CEO should take regarding a very expensive employee in the lead of a major project.

Maybe NBC’s producers should spend more time looking at trends, and figuring out how to program content that will improve The Tonight Show‘s competitiveness.  The show was upended in just one year.  What will total audience look like next May when the 2017-2018 season ends?  Will revenues and profits be unaffected if NBC’s audience keeps falling while CBS’s keeps growing?

For the rest of us, the lesson should be clear.  Nobody is relegated to always being #2.  Regardless the leader’s size, if you study trends and figure out how to leverage them you can grow, and you can become #1.

 Understanding trends and applying them to your business is the best way to invigorate growth and improve your competitiveness.

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What The NBA All-Star Game Venue Change Teaches Us About Decision-Making

Leaders like to be deciders. Most leaders think of themselves as decision makers. In 2006 President George Bush, defending Donald Rumsfeld as his Defense Secretary said “I am the Decider.  I decide what’s best.” It earned him the nickname “Decider-in-Chief.” Most CEOs echo this sentiment. Most leaders like to define themselves by their decisions.

But whether a decision is good or not is open to interpretation. Often immediately after a decision things may look great. It might appear as if that decision was obvious. And often decisions quickly make a lot of people happy.

As we enter the most intense part of the U.S. presidential election, both candidates are eager to tell potential voters what decisions they have made – and what decisions they will make if elected. And most people will look no further than the immediate expected impact of those decisions.

AP Photo/Chuck Burton, File

It takes time to determine the quality of any decision.

However, the quality of most decisions is not based on the immediate, or obvious, first implications. Rather, the quality of a decision is discovered over time, as the consequences are revealed – intended and unintended. Because quite often, what looked good at first can turn out to be very, very bad.

The people of North Carolina passed a law to control the use of public bathrooms. Most people of the state thought this was a good idea, including the governor. But some didn’t like the law, and many spoke up. Last week the NBA decided that it would cancel its All-Star game scheduled in Charlotte due to discrimination issues caused by this law. This change will cost Charlotte about $100 million.

 That action by the NBA is what’s called unintended consequences. Lawmakers didn’t really consider that the NBA might decide to take its business elsewhere due to this state legislation. It’s what some people call, “Oops. I didn’t think about that when I made my decision.”

Often unintended consequences are more important than first reactions to decisions.

Robert Reich, Secretary of Labor for President Clinton, was a staunch supporter of unions. In his book Locked in the Cabinet, he tells the story of visiting an auto plant in Oklahoma supporting the local union. He thought his support would incent the company’s leaders to negotiate more favorably. Instead, the company closed the plant. Laid-off everyone. Oops. The unintended consequences of what he thought was obvious support led to the worst possible worker outcome.

President Obama worked Congress hard to create the Affordable Care Act, or Obamacare, for everyone in America. One intention was to make sure employers covered all their workers, so the law required that if an employer had health care for any workers he had to offer that health care to all employees who worked over 30 hours per week. So almost all employers of part time workers suddenly said that none could work more than 30 hours. Those that worked 32 (four days per week) or 36 suddenly had their hours cut. Now those lower-income people not only had no health care, but less money in their pay envelopes. Oops. Unintended consequence.

President Reagan and his First Lady launched the “War on Drugs.” How could that be a bad thing? Illegal drugs are dangerous, as is the supply chain. But now, some 30 years later, the Federal Bureau of Prisons reports that almost half (46.3% or over 85,000) of inmates are there on drug charges. The U.S. now spends $51 billion annually on this drug war, which is about 20% more than is spent on the real war being waged with Afghanistan, Iraq and ISIS.  There are now over 1.5 million arrests each year, with 83% of those merely for possession. Oops. Unintended consequences. It seemed like such a good idea at the time.

This is why it is so important leaders take their time to make thoughtful decisions, often with the input of many other people. Because the quality of a decision is not measured by how one views it immediately. Rather, the value is decided over time as the opportunity arises to observe the unintended consequences, and their impact. The best decisions are those in which the future consequences are identified, discussed and made part of the planning – so they aren’t unintended and the “decider” isn’t running around saying “oops.”

Think hard about the long-term complications of any decision.

As you listen to the politicians this cycle, keep in mind what could be the unintended consequences of implementing what they say:

  • What would be the social impact, and transfer of wealth, from suddenly forgiving all student loans?
  • What would be the consequences on trade, and jobs, of not supporting historical government trade agreements?
  • What would be the consequences on national security of not supporting historically allied governments?
  • What would be the long-term consequence of not allowing visitors based on race, religion or sexual orientation?
  • What would be the consequence of not repaying the government’s bonds?
  • What would be the long-term impact on economic growth of higher regulations on banks – that already have seen dramatic increases in regulation slowing the recovery?
  • What would be the long-term consequences on food production, housing and lifestyles of failing to address global warming?

Business leaders should be very aware of the long-term consequences of their decisions. Every time a decision is necessary, is the best effort made to obtain all the information available on the topic? Are inputs and expectations obtained from detractors, as well as admirers? Is there a balance between not only what is popular, but what will happen months into the future? Did you consider the potential reaction by customers? Employees? Suppliers? Competitors?

There are very few “perfect decisions.” All decisions have consequences. Often, there is a trade-off between the good outcomes, and the bad outcomes. But the key is to know them all, and balance the interests and outcomes. Consider the consequences, good and bad, and plan for them. Only by doing that can you avoid later saying “oops.”

Do You Know President Trump’s Immigration Policy?

Do You Know President Trump’s Immigration Policy?

(Photo by Olivier Douliery-Pool/Getty Images)

There is a lot of excitement about President Donald Trump’s planned new executive order on immigration. Before the order is even public, the press has been grilling White House Press Secretary Sean Spicer about its contents. People are preparing to object before the document is even read.

Given that we know the order deals only with immigrants from seven countries, and that people from those countries do not constitute anywhere near a meaningful minority of immigrants (or tourists), one could make a case that in and of itself the executive order should not receive anywhere near this much attention.

But simultaneously, President Trump’s secretary of state and secretary of homeland security are visiting Mexico on Thursday — which is creating its own a firestorm of media coverage. The Mexican government leadership has already come out swinging, before the meeting, saying that the Trump administration policies are unacceptable. Not only is the wall construction unacceptable, but plans to deport illegal immigrants to Mexico — including illegal immigrants that are not Mexican — will not be tolerated. They want to know why should Mexico be forced to take Guatemalans, Hondurans and other non-Mexicans?

 All of this controversy is being driven by the U.S. leadership, the president and his cabinet, failing to offer a clear policy on immigration. These executive orders, impending demands and vitriolic statements from the administration are like rifle shots aimed at something. But because nobody has a clue what the administrations real immigration policy is, it is impossible to understand the context from which these shots are fired. Nobody really knows what these shots are aimed at achieving.

So everyone, including the media, is left guessing, “what is the target of these actions? What is the overall goal? What is the administration’s immigration policy into which these actions fit?”

The administration says these actions are driven by “national security.” But it is impossible to understand that claim lacking any context. How are these specific actions supposed to improve national security, when every day people come to the U.S. from Europe and Asia with Muslim backgrounds and training? People cross the Canadian border daily who started in another country, yet they are not seen as the same threats as those who cross the southern border — why not?

 Thus, each rifle shot looks an awful lot like an attack against the narrow interest being targeted — specifically middle eastern Muslims and Mexicans. And a lot of people are left scratching their heads as to why these folks are being attacked, other than they are simply easy targets for a part of the U.S. population that is horribly xenophobic.

Everyone — and I literally mean everyone — knows that America is a nation of immigrants. Last Labor Day I wrote about the benefits America has enjoyed by opening its doors to immigration. Recently Ryan McCready of Venngage put together a detailed infographic describing how over half of America’s billion dollar start-ups were founded by immigrants, how 33,000 permanent jobs were created by immigrants, how 76% of patents from top universities were filed by immigrants, and how 100% of America’s 2016 Nobel Prize recipients were immigrants. Nobody really doubts that immigrants have been good for America.

But, everyone also knows all immigrants are not the target of the Trump administration rhetoric, travel restrictions or executive orders. On January 28, in an editor’s pick column, I detailed how the border wall does not even address the problem of illegal immigrants that might be stealing jobs or committing crimes. If it was easy for me to produce the data that it is not illegal Mexican immigrants stealing jobs or creating crime, no doubt the people atop our government have even better data.

Another, possibly more obscure, example of an unaddressed immigration issue was brought to my attention in a recent BBC column (thanks to my cousin Susan Froebel from Austin, TX). Developers are planning for a large migration of retired Chinese to the U.S. These Chinese will enter America with no income, and no job prospects. They are escaping China, where the aged population is growing so fast there is great concern the workforce cannot care for them. They will increase the aged population in American, putting greater strains on all social services — housing, food, medicine. This will increase demands on the remaining American workers, as the U.S.’s own baby boomer generation retires, creating the worst imbalance of non-workers to workers in American history.

If there is any demographic you do not want immigrating to the U.S. it is a bunch of retired people. As I pointed out in my September 16 column, as any country’s population ages it creates a demand for more young immigrants to create economic productivity, growth and the resources to take care of the non-productive retirees. Rather than retirees, what America needs are young, productive immigrants who create and fill jobs — growing the economic base and paying taxes to support the rising retiree class.

But, I’d bet almost nobody who reads this column even knows about the impending explosion of retired Chinese planning to permanently enter the U.S. Even though the economic impact could be disastrous — far, far worse than a few million undocumented workers from Mexico or the middle east. Instead the focus is on two very targeted groups — Muslims and Mexicans.

The Elephant In The Room

Unfortunately, we all remember the infamous voter who attended a John McCain rally in 2007 and said that then-candidate Barack Obama was a Muslim born in Africa. In that moment that woman put forward the fears of so many Americans — that you cannot trust a dark skinned person. You cannot trust anyone who is not Christian. You cannot trust anyone who is not born within the U.S. Everyone else is someone to fear.

Lacking a well drafted, and at least somewhat comprehensive immigration policy, the immediate actions of the U.S. president sound a lot like, Stop the Muslims. Stop the Mexicans. After all, everyone knows they cannot be trusted. They are bad hombres.

Does the U.S. need more border protection? Does the U.S. need to crack down on illegal immigrants?Does the U.S. need to limit immigration? Perhaps yes — perhaps no. And if so, by how much? Right now nobody knows what the Trump administration immigration policy is. All the administration has put forward are rifle shots that appear to be pointed at the easiest targets of hatred in America today — Muslims and Mexicans. Whether these groups deserve to be targeted, or not.

Good leaders develop their vision first. The leadership team puts together the vision, mission and goals for the organization. Then this is developed into a strategy which guides investment and decision-making. The policy platform provides the context so the leaders, and all constituents, can identify the goals of the organization and the planned route to achieve those goals. After that is in place independent actions (decisions) can be evaluated as to their fit with the vision, mission and overall strategy.

As business leaders, President Trump and Secretary Tillerson (former ExxonMobile CEO) should know these first principles of leadership. Yet, they have failed to provide this vision. They have failed to describe their strategy to accomplish their mission. They have failed to tie their words and actions to a plan for achieving their goals (goals which are also still quite vague — such as “a safer America” or “a greater America”). So their actions are being interpreted by their constituents from each constituent’s perspective.

No wonder everyone has an opinion about what’s happening — and no wonder so many people are full of angst. There is a reason leaders take time in their early days to put develop their platform, and discuss it with constituents. Successful leaders make sure the people they depend upon know  their vision, goals and strategy (in this case not only voters but Senators, members of Congress, the judiciary, law enforcement, military and regulators). Only after this do they take action — action clearly aligned with their vision, supported in the strategy and directed at achieving their goals.

For now, lacking the proper context, most Americans are interpreting short-term immigration actions as attacks on Muslims and Mexicans. Those who like these actions do so thinking it is proper, and those who dislike these actions think it is unfair targeting. But people will continue to make their own interpretations until a comprehensive policy is offered that explains a different context. As long as that policy is unclear, these poorly explained actions are examples of bad leadership.

Why President Trump’s Border Wall Is An Example Of Bad Leadership

Why President Trump’s Border Wall Is An Example Of Bad Leadership

(Photo: NICHOLAS KAMM/AFP/Getty Images)

“Get the assumptions wrong and nothing else matters” – Peter F. Drucker

President Donald Trump made it very clear last week that his administration intends to build a border wall between the U.S. and Mexico. And he intends to make Mexico pay for it. He is so adamant he is willing to risk U.S./Mexican relations, canceling a meeting with the Mexican president.

Unfortunately, this tempest is all because of a really bad idea. The wall is a bad idea because the assumptions behind this project are entirely false. Like far too many executives, President Trump is building a plan based on bad assumptions rather than obtaining the facts – even if they belie his assumptions – and developing a good solution. Making decisions, and investing, on bad assumptions is simply bad leadership.

The stated claim is Mexico is sending illegal immigrants across the border in droves. These illegal immigrants are Mexican ne’er do wells who are coming to America to live off government subsidies and/or commit criminal activity. The others are coming to steal higher paying jobs from American workers. America will create a h

Unfortunately, almost everything in that line of logic is untrue. And thus the purported conclusion will not happen.

1. Although it cannot be proven, analysts believe the majority (possibly vast majority) of illegal immigrants enter America by air. There are two kinds of illegal immigration. President Trump’s rhetoric focuses on “entries without inspection.” But most illegal immigrants actually arrive in America with a visa – and then simply don’t leave. These are called “overstays.” They come from Mexico, India, Canada, Europe, Asia, South America, Africa – all over the world. If you want to identify and reduce illegal immigration, you need to focus on identifying likely overstays and making sure they return. The wall does not address this.

 2. Not everyone who speaks Spanish is Mexican. Without a doubt, the vast, vast majority of people who illegally immigrate across the Mexican border are from Central America. They leave harsh conditions in Honduras, El Salvador, Guatemala and other politically unstable nations. They traverse a difficult Mexican landscape – perhaps more than half of them unaccompanied minors – in an effort to find a place to live. In 2014 Mexico captured and deported 150,000 Central Americans, an increase of 44% from the previous year, and they represented 97% of Mexico’s deportations. Human migratory movement is not a Mexican problem, it is a Central American problem.

3. More non-Mexicans than Mexicans were apprehended at the U.S. border – and the the number of Mexicans has been declining. From 1.6 million in 2000, by 2014 the number dwindled to 229,000 (a decline of 85%). If you want to stop illegal border immigrants into the U.S., the best (and least costly) policy would be to cooperate with Mexico to capture these immigrants as they flee Central America and find a solution for either housing them in Mexico or returning them to their country of origin. It is ridiculous to expect Mexico to pay for a wall when it is not Mexico’s citizens creating the purported illegal immigration problem on the border.

4. In 2015 over 43,000 Cubans illegally immigrated to the U.S. – about 20% as many as from Mexico. The cost of a wall is rather dramatically high given the weighted number of illegal immigrants from other countries.

5. The number of illegal immigrants living in the U.S. is actually declining. There are more Mexicans returning to live in Mexico than are illegally entering the U.S. Between 2009 and 2014 over 1 million illegal Mexican immigrants willingly returned to Mexico where working conditions had improved and they could be with family. In other words, there were more American jobs created by Mexicans returning to Mexico than “stolen” by new illegal immigrants entering the country. If the administration would like to stop illegal immigration the best way is to help Mexico create more high-paying jobs (say with a trade deal like NAFTA) so they don’t come to America, and those in America simply choose to go to Mexico.

6. Illegal immigrants are not “stealing” more jobs every year. Since 2006, the number of illegal immigrants working in the U.S. has stabilized at about 8 million. All the new job growth over the last decade has gone to legitimate American workers or legal immigrants working with proper papers. Illegal immigration is not the reason some Americans do not have jobs, and blaming illegal immigrants is a ruse for people who simply don’t want to work – or refuse to upgrade their skills to make themselves employable.

7. Illegal immigrants in the U.S. is not a rising group – in fact most illegal immigrants have been in the U.S. for over 10 years. In 2014, over 66% of all illegal immigrants had been in the U.S. for 10 years or more. Only 14% have been in the U.S. for 5 years or less. We don’t have a problem needing to stop new illegal immigrants (the ostensible reason for a wall). Rather, we have a need to reform immigration so all these long-term immigrants already in the workforce can be normalized and make sure they pay the necessary taxes.

8. The states where illegal immigration is growing are not on the Mexican border. The states with rising illegal immigration are Washington, Pennsylvania, New Jersey, Virginia, Massachusetts and Louisiana. Texas, New Mexico and Arizona have seen no significant, measurable increase in illegal immigrants. And California, Nevada, Illinois, Alabama, Georgia and South Carolina have seen their illegal immigrant population decline. A border wall does not address the growth of illegal immigrants, as to the extent illegal immigrants are working in the U.S. they are clearly not in the border states.

Good leaders get all the facts. They sift through the facts to determine problems, and develop solutions which address the problem.

Bad leaders jump to conclusions. They base their actions on outdated assumptions. They invest in the wrong places because they think they know everything, rather than making sure they know the situation as it really exists.

America’s “flood of illegal immigrants” problem is wildly overblown. Most illegal immigrants are people from advanced countries, often with an education, who overstay their visa limits. But few Americans seem to think they are a problem.

Most border crossing illegal immigrants today are minors from Central America simply trying to stay alive. They aren’t Mexican criminals, stealing jobs, or creating a crime spree. They are mostly starving.

President Trump has “whipped up” a lot of popular anxiety with his claims about illegal Mexican immigrants and the need to build a border wall. Interestingly, the state with the longest Mexican border is Texas – and of its 38 congressional members (36 in Congress, 2 in the Senate and 25 Republican) not one (not one) supports building the wall. The district with the longest border (800 miles) is represented by Republican Will Hurd, who said “building a wall is the most expensive and least effective way to secure the border.”

Good leaders do not make decisions on bad assumptions. Good leaders don’t rely on “alternative facts.” Good leaders carefully study, dig deeply to find facts, analyze those facts to determine if there is a problem – and then understand that problem deeply. Only after all that do they invest resources on plans that address problems most effectively for the greatest return.

Could Donald Trump Lead A Boy Scout Troop?

Could Donald Trump Lead A Boy Scout Troop?

(Photo by Shawn Thew-Pool/Getty Images)

Professor John Kotter (Konosuke Matsushita Professor of Leadership HBS) penned Power and Influence (1985, Free Press) after teaching his course of the same name at the Harvard Business School.  The one thing he found clear, as did his students (of which I was one), was that a person can be powerful and have influence, but that does not make them a leader. Leaders understand how to create and use both power and influence. But merely having access to either, or both, does not make a person a leader.

One of my mentors, Colonel Carl Bernard, famed leader of U.S. Special Forces in Laos and Vietnam during the 1960s, met an executive at DuPont in the mid-1980s who had been given a large organization but was struggling. Col. Bernard was asked to review this fellow and offer his leadership insights so this fellow’s peers could help him be a better corporate leader. After a few meetings with this exec, alone and in groups, Col. Bernard concluded, “DuPont can give him resources, and access to the CEO, but that man could not lead a Boy Scout troop. Best they close the business now before he causes too much trouble. There’s nothing I can do for him.” Two years later, and tremendous turmoil later, DuPont did close that business, fired him and wrote off everything the company had invested.

Last Friday, Donald Trump was sworn in as president of the United States. He now has the most powerful job in the free world and unparalleled influence. But, he’s not yet proven himself a leader. His accomplishments to date have all been executive orders – issued unilaterally. To achieve the title “leader,” he has to prove people will follow him.

 President Trump did not win the popular vote, and he assumes his new job with the lowest approval rating of any first-term president ever elected. Numbers alone do not imply that the country is ready to call him its leader.

Historically, a president has had to screw up in office to have such low popularity. But on Saturday millions of demonstrators took to the streets of Washington, Los Angeles, Chicago, Minneapolis and other cities to protest a president who had yet to do anything in his new role. Far more demonstrated than attended the inauguration, which had about half the attendees as Barack Obama’s first inauguration. It took Lyndon Johnson years to create the animosity which lead to demonstrators chanting, “Hey, hey LBJ, how many kids did you kill today?” (referencing his escalation of the Vietnam War).

 Business school thought leaders, and business executives, have been studying leadership for at least six decades, and they have discovered there are consistencies in how to encourage followership. Roger Ferguson, CEO of TIAA-CREF, said leadership is about inspiring people. He teaches that this is done by

• demonstrating expertise – which Trump has yet to do as a politician,
• making yourself appealing – which Trump has missed by deriding those who speak out against him,
• showing empathy for others – a trait so far missing in Trump’s tweets, or comments about detractors
• and showing the fortitude of being the calm in the storm – the opposite of Trump, who’s fiery rhetoric creates more storms than it calms.

In 2013, fellow Forbes contributor Mike Myatt offered his insights into how one should lead those who don’t want to follow, tips that should be very interesting to the unpopular President Trump:

• Be consistent. This seems the antithesis of Trump, who favors inconsistency and campaigned that as President he intended to be inconsistent.
• Focus on what’s important. Reading Trump’s tweets, it is clear he struggles to separate the important from the meaningless
• Make respect a priority. Should we talk about Trump’s references to women? Or his comments about war heroes like John McCain?
• Know what’s in it for the other guy. Trump likes to brag about taking advantage of others in his business dealings, and showing blatant disregard for the concerns of others. Recommending African-Americans vote for him because “what have you got to lose” does not demonstrate knowledge of that constituency’s needs.
• Demonstrate clarity of purpose. Firstly, what does it mean to “make America great again?” It would be nice to know what that slogan even means. Second, if Trump is the President for “those of you left behind,” as he referenced in his inauguration speech, can he tell us who is in that group? Am I included? Are you? How do you know who’s in this group he now represents? And who’s not?

Americans frequently confuse position with leadership. Many CEOs are treated laudably, even after they have destroyed shareholder value, destroyed thousands of jobs, stripped suppliers of money and resources, doomed local economies with shuttered facilities and left their positions with millions of dollars despite a terrible performance. These CEOs demonstrated they had power and influence. But many are despised by their former employees, investors, bankers, suppliers and community connections. They did not demonstrate they were leaders.

Despite his great wealth, which has bought him substantial power and influence, Americans have yet to see if President Trump can lead. He has never been a commissioned or non-commissioned officer in a military organization.  He has never led a substantial corporation with large employment. He has never led a substantial non-profit or religious organization. Contrarily, he has largely been the head of hundreds of small businesses (by employee standards) many of which he has closed or bankrupted, often leaving people unemployed, his investors losing money and communities (such as Atlantic City) worse off from his real estate dealings.

I prefer to write about corporate leaders and market leaders. But for a while now, almost all the news has been about Mr. Trump. Now President Trump, who has not previously led even a Boy Scout troop.  One wonders of Col. Bernard would think he could.

“The greatest leader is not necessarily the one who does the greatest things. He is the one that gets the people to do the greatest things” – Ronald Reagan

The No. 1 Trend For Planning — Demographics — And Why People Are Fleeing Illinois

Trend analysis is the most critical part of planning.

Some trends are hard to spot, because people think they are just a fad. Many folks think electric cars fit that category.

Other trends are hard to accept because they imply a big shift in how we live or work – or how we run our business. Scores of IT people who have written me over the years saying mobile devices on common networks (telecom to AWS) will never replace PCs connected to server farms. The implications of this trend are severely negative related to demand for their skills, so they ignore it.

But every plan should be built on trends, because these forecasts are critical for decision-making. It’s the future that matters, not the past. Too often plans are built on history, when trends clearly indicate that things are going to change, and old assumptions are outdated.

Demographic trends are easy to forecast, and important.

While some trends are hard to forecast, some trends are really easy to spot and forecast. And the easiest trend to understand is demographics. If you don’t use any other trends in your planning, you should have demographic trends at the core of your assumptions.

 Take for example the movement of people across the United States. Ever since the wagon train people have been moving west. And, like my friend Buckley Brinkman (executive director and CEO of the Wisconsin Center for Manufacturing and Productivity) likes to say, “ever since the invention of air conditioning people have been moving south.” Yet, I’m startled how few organizations plan for this shift and adjust their strategies and tactics to be more successful.

From July 1, 2015 to July 1, 2016 the seven fastest growing states were western.  And of 50 states, only eight lost population.

Growth is sublime, decline is disastrous.

 Bruce Henderson, founder of the Boston Consulting Group, used to say that if you want to hunt or farm you’re far better off in the Amazon than you are in the Arctic. Basically, where there are resources, and lots of growth, it’s a lot easier to succeed.

For business, this means that if you want to grow your business – whether you’re installing HVAC systems or building a state-of-the-art battery manufacturing plant – you’ll find it relatively easier in faster growing states.  It doesn’t mean there is no competition, but it does mean that growth makes it easier for competitors to succeed.

Contrastingly, there were eight states that lost population in this same 12 months.

This means that competition is intensifying in these states. As people move out there are fewer customers to buy what each business sells, so these companies have to fight harder, and price lower, to grow – or even maintain.  As the population declines taxes have to go up because there are fewer taxpayers to cover government costs. These states become less desirable places for business.

The businesses in Illinois, for example, are in the middle of a bare-knuckle brawl over the state budget that has gone on for two years. The Governor and the legislature cannot agree on how to manage costs, or revenues.  Bond ratings have been slashed as costs to borrow have gone up.  Several services have been shut down, and student costs at universities have gone up while programs have been gutted or discontinued.

Governor Rauner (R – IL) has repeatedly said he wants Illinois to be more like Indiana, its neighbor to the east.  Perversely people apparently are listening, because Illinois is shrinking, while Indiana grew a healthy 0.31%. For residents remaining in Illinois this worsens a host of maladies:

• the state’s jobs situation struggles as the number of paying jobs declines, making it harder to recruit new talent, or even keep its own university graduates;
• Illinois’ pension problems worsen,  as there are fewer people paying into the pension funds while those drawing out funds keep increasing;
• Illinois is unable to fund schools properly, especially Chicago, due to less income – forcing up property taxes;
• taxes keep rising due to fewer people and businesses (when adding property taxes, sales taxes and income taxes Illinois is now the highest tax state in the country);
• new highways are being built with federal funds, but other infrastructure is in trouble, as city, county and state roads are pothole ridden. Trains and subways become outdated and fall into disrepair. And one-time budget Hail Mary’s, like Chicago selling its parking structures and meters in order to balance the budget for one year, strip citizens of future revenues while they watch parking (and other) service costs skyrocket;
• and Chicago has suffered the lowest real estate recovery rate of the top 30 major U.S. cities –not even returning to prices in 2008.

Growth solves a multitude of sins.

Just like a rising tide raises all boats, growth creates more growth. More people increases demand for everything, which increases business sales, which increases jobs and wages, which increases the value of real estate and household wealth, which increases tax revenue, which allows offering more services to make a state even more appealing.

On the other hand, shrinking can become like the whirlpool over a drain. As the problems increase more people decide to leave, making the problems worsen. As more people go, there are fewer people left behind to make things better. Jobs go away, wages fall, demand drops, real estate prices drop, infrastructure projects stop, services stop and yet taxes have to be raised on the fewer remaining residents.

Few trends are more important for planning than understanding demographics. Demographics affect demand for everything, and planning for changes offers businesses the opportunity to be in the right place, at the right time, to be more successful. And, demographic trends are some of the easiest to predict:

• population size
• average age, and sizes of age groups
• average income, and sizes of income groups
• ethnicity
• religion

Plans should be based on trends, not history. Understanding trends, and their trajectory, can help you be in the right market, at the right time, with the right product in order to succeed. There are lots of trends, but one that is fairly obvious, and incredibly important, is simply understanding demographics. Is this built into your planning system?

Don’t Fall For Election Day Traders: Trends Say To Buy Tech Stocks

Don’t Fall For Election Day Traders: Trends Say To Buy Tech Stocks

Traders work on the floor of the NYSE the morning after Donald Trump
won a major upset in the presidential election. (Photo by Spencer Platt/Getty Images)

Since election day there has been an enormous shift in the U.S. stock market. The Dow (Dow Jones Industrial Average – DJIA) has hit new highs. But simultaneously the NASDAQ 100 is falling. In short, most tech stocks have been creamed, while out-of-favor laggards have been bid up.

I 100% favor long-term investing. Anyone who tries to be a trader, or otherwise time the markets, is most likely going to get burned. If you want to share in the growth of America’s economy the best way is to buy stocks in good, growing companies and hold them a long time. As Warren Buffett said after the election, the American economy will be bigger, and stocks will be worth more, in 10, 20, 30 years regardless who is president.

Traders make decisions on the smallest bit of information. Often information that is nothing more than an unproven thought.  Looking into the future they try to have a crystal ball, but they rarely use trend information and often use guesses.

 So, after the election, the trader theory goes that tech companies will be burned. Trump apparently doesn’t use a computer, so he doesn’t use the Internet. And he doesn’t actually tweet, or use social media, he just blurts things out and someone else enters the blurts. So his lack of interest in technology is bad for tech companies. Further, his trade policies will create havoc with tech company supply chains that rely on manufacturing across Asia, and much on China, dramatically raising costs. Additionally these policies will cause foreign markets to purchase less tech products, damaging tech sales.

As a result, rapidly, big, successful tech stocks have been massacred:

Apple from $118 to $107, a drop of 9%
Facebook from $133 to $116, a drop of 13%
Netflix from $128 to $115, a drop of 10%
Google from $815 to $755, a drop of 7%
Amazon from $840 to $730, a drop of 13%

Yet, nothing has happened. These companies are still doing exactly the same thing they did a month ago. Apple is still the no. 1 maker and seller of mobile devices. Facebook still dominates social media, has a huge lead in social media advertising, and continues to launch additional functionality to make its site sticky for users. Netflix is still the leader in streaming and developing new original content outside of networks. Google is still the  king of search and no. 1 in search advertising. And Amazon still leads all competitors in online commerce, and will have another great holiday season the next six weeks.

None of these businesses have been destroyed by the election. And the trends that drove their long-term growth remain in place. People will continue to use mobile devices for more applications, turn to social media for communicating with friends and finding information, download movies and other shows via the web, search for answers to most of their questions via search engines and buy more and more stuff online. These trends will not change, as there is pretty much no way Donald Trump or Congress can stop them.

Meanwhile, valuations of long-time laggard companies are suddenly hitting new highs. Somehow the trend to globalization will be ended, budget problems will be immediately resolved leading to greater spending capability by Congress and concerns about long-term debt build-up will disappear encouraging massive new investments in traditional infrastructure like roads and bridges. New trends will suddenly emerge that will return the basics of the U.S. economy, the sector balances, to something akin to 1984.

Thus, traders have bid up prices of old-line manufacturers. Despite exiting financial services as well as its oil and gas business, making GE much smaller than it was a decade ago, GE has jumped from $28.25 to $30.50, a gain of 8%. Caterpillar Tractor has had five straight years of revenue declines, yet it also rose from $28.25 to $30.50 for a similar 8% gain.

Remarkably GE’s P/E (price/earnings multiple) is now 24! Cat’s is an even more remarkable 53! Companies that rely on manufacturing are being priced like tech stocks – or even greater! Apple’s P/E has fallento 13, Google’s is 27 (about the same as GE) and Facebook’s P/E of 46 is lower than Caterpillar’s.

Really? In one day major, global trends have reversed course, steering the economy back to the days when Jack Welch ran GE, and Caterpillar was selling gear to a booming U.S. forestry business as well as massive volumes to China and India for building their fledgling infrastructures? People will stop buying smartphones and give up their reliance on the internet for a vast array of daily tasks? And droves of young workers trained for tech jobs are going to staff up a massive rebuilding of U.S. manufacturing plants? Displaced workers, trained on equipment now wildly antiquated and uneconomic, will be retrained overnight to operate plants with far fewer employees and lots more high-tech equipment? And boomers will quit retiring and undertake retraining – not for tech jobs but for manufacturing or equipment operator jobs?

Don’t diminish the power of a president. And don’t diminish how structural changes in tax codes, military spending and international relations can alter course. But, simultaneously, don’t diminish the power of trends.

Trends propel forward, and take people to greater productivity and a higher quality of life.  All those people who voted for Donald Trump are not tech avoiders. They are mobile, socially active people who are as linked to the trends as everyone who voted for Hillary Clinton. They don’t want to return to a pre-information economy lacking in technology that has made their lives better.  They still want technology in their lives, and they want that technology to become better, faster and cheaper.

And no manufacturer is going to go back to labor-intensive manufacturing. Whether they make things in the U.S. or offshore, state-of-the-art equipment means manufacturing simply uses fewer people. And the growth of e-commerce will not stop, thus continuing the trend of declining demand for retail workers.  These trends may alter slightly due to tax and trade policies, but they won’t reverse.

Smart investors don’t lose sight of long-term trends. They invest in companies where the opportunity exists to grow revenues and profits because demand for those company’s products and innovations are growing. With shares of the technology leaders beaten down, one should really consider if this is a time to sell, or buy. And with shares of companies that have terrible growth records, and stagnated earnings, bid up to extraordinarily high P/E multiples one should consider if this is the time to buy or sell.

Clinton Won? No, Clinton Lost: Lessons For Marketers

Clinton Won? No, Clinton Lost: Lessons For Marketers

(AP Photo/Wilfredo Lee, File)

November 9, 2016 – Donald Trump is the president-elect of the United States. It is a stunning upset.  What are the lessons for marketers?

First, notice that candidate Hillary Clinton actually won the popular vote. With just under 120 million votes cast, Clinton gathered about 160,000 more votes than candidate Trump.  A victory of just over .1%. So it is fair to say that on this metric, number of votes, there was a win for Clinton.

But, of course, the complexity of America’s electoral college means that Trump won more electoral votes, and thus the election. Non-Americans struggle to understand the electoral college – heck, a lot of American’s don’t understand it. Put simply, it was the founding father’s method of making sure different geographies achieved representation so that more dense population areas would not control an election.

Given that everyone knew that in the end it was these votes – electoral votes – that mattered, it is important to think through the marketing implications.

Monday, pre-election, I wrote that it appeared the marketing campaign of candidate Clinton was superior to that of candidate Trump.  And, given that it achieved more popular votes, it may have been a superior campaign.  But since it did not achieve the goal, its worth revisiting to see where that analysis erred, and what can be learned.

 Product: Candidate Trump was very, very negative. He had nothing good to say about anything the incumbent president had done, nor anything good to say about candidate Clinton.  He was the epitome of negative. Although the Clinton campaign claimed it would “go high” as the Trump campaign “went low” this really did not happen. Clinton’s campaign tried to duke it out toe-to-toe on who was worst.

In the end, this hurt both candidates. Neither had great appeal to voters, and both had extremely high negatives. But by succumbing to a bruising bad-on-bad punching match the Clinton campaign missed an opportunity to present the candidate as very favorable. The candidate that punched the hardest – and no doubt with his constant attacks, including threats to indict candidate Clinton this gave candidate Trump a bit of an edge – was going to win.

 Lesson -Firstly, make your product favorable.  Make it something people really want.  Don’t say bad things about the competition until you’ve staked your favorable position.  Clinton never really achieved a favorable position with enough voters.

Second, if you’re going to get into a dirty fight, don’t bring a knife – bring a gun. In a competition of negatives, you have to be every bit as negative as the competition. No holds barred. The meanest, ugliest, hardest hitting competitor will win.

Price: Candidate Clinton absolutely failed to make the case that the incumbent’s economic policies had favored most Americans. Despite tremendous job growth, declining unemployment, record low layoffs and record high equity values there persisted a notion that the American economy was in the tank. The campaign completely failed to make the case that the policies enacted previously, and anticipated to continue with Clinton, would be good for people’s pocketbooks.

Meanwhile, candidate Trump hammered away saying that the American economy was a wreck. His appeals to reducing international trade and limiting immigration in order to create more higher paying jobs in America convinced a large number of voters that these policies would be better for the economy and most workers.

Concerns about potential debt increases and an extension of income inequality were poorly made, and did not counter the overriding sense that more jobs would come from Trump’s policies. Thus, a lot of people were swayed to Trump’s xenophobic view of how to improve America’s economy. They remain convinced that Mexico will pay for an immigration limiting wall, and scaling back (or eliminating) trading pacts like NAFTA will somehow cause an inspired growth in American manufacturing jobs, and higher levels of good paying employment.

Lesson – you have to make the economic case for your product.  You have to deliver a winning value proposition. Don’t expect customers to figure it out on their own, or assume they believe in your value proposition.

Place: This is where the breakdown was greatest for Clinton, and most beneficial for Trump. On Monday I noted several indicators that the Clinton campaign would do far better at getting out the vote than Trump. And, one could say they did given that Clinton won the popular vote.

But the Clinton error was relying too heavily on dense population states. New York, Illinois, California – states with very big cities that dramatically overwhelm the rural population produced landslide votes for Clinton. But in states with a more balanced population density, such as Ohio, Florida and Pennsylvania there was an insufficient effort at making sure non-city counties turned out for Clinton.

Contrarily, the Trump campaign won the battle for place by realizing they could win the rural states with limited effort. Large geographic swaths with low population density allowed Trump to pile up electoral votes (the ones that matter) almost unchallenged. Kansas, Oklahoma, Wyoming, Nebraska, South Dakota, North Dakota – all states benefiting precisely from the electoral system the founding fathers created – were key states that the Clinton campaign ignored in its distribution strategy.

What appeared to be a Clinton campaign advantage, largely strong support by the Democratic party, overly-relied on winning population dense counties. This was effectively countered by a very good job by the Trump campaign of acquiring votes in more rural, less dense, counties.  This ground game, of making sure the votes were captured county-by-county, was decisive for Trump.

Lesson – distribution matters. It may seem boring. It’s a lot less sexy than writing ad copy or focusing on PR.  But it really, really matters.

Promotion: It turns out money, and extreme messaging, still matters.

The Obama campaign was masterful at using modern marketing techniques, including internet marketing, mobile and social media, to obtain support. The Bernie Sanders primary campaign also proved adept at using these tools for gaining a good following. While the Clinton campaign lifted this part of the playbook, their implementation was not as integrated, nor effective, as either Obama or Sanders. The pieces were there, but the appeal was not as targeted to specific groups and therefore not nearly as effective. Clinton’s team used these tools, but they did not invest in them with the skills exhibited by Obama or Sanders, and they failed at bringing enough minorities, youth and women to the polls.

Meanwhile, Trump’s campaign once again made the case that money matters. Large advertising programs still make a difference. Marketing is changing, but in a winner-take-all, and you only get one chance, campaign classic advertising and PR used since the 1960s really matters.  Things are changing, but they have not fully changed. If you are willing to spend enough money on traditional promotional tools, they still reach most of the people. It may not be efficient, but they are still effective.

Simultaneously, the old adage “any press is good press” proved valuable once again.  Tapes of Trump saying outrageous things, and outrageous tweets, served to provide ample free promotion for the candidate.  While many people complained about the message content, in the end simply being constantly in the news helped people get used to a very unusual campaign style.  An unorthodox approach, letting outrageous behavior become so common that customers were able to look past the negatives, allowed the constant access to become an advantage.

There are great lessons here to be learned by marketers today.

  • Distribution really matters. In the internet, Amazon.com age it is easy to think that if you build it they will come. But success still requires a lot of effort to make sure your product is in the right place when people are ready to buy.  And that means on the web, on social media and eventually physical location.
  • The trend is toward micro-marketing with targeted messages to targeted segments. But during the evolution old, brute force tools still make a difference.  To make a trend work for you, you have to work hard at building on that trend.  You cannot expect success merely by adopting the trend, you have to master highlighting the trend, and making it useful for your campaign to reach customers.
  • Even messages built on myth cannot be ignored, and in fact must be fought extremely hard. Chipotle’s has struggled to convince customers its food won’t make them sick, because the message was not effectively countered. Similarly, despite ample evidence of a strong economy Clinton failed to convince customers that claims of a weak economy were unfounded. The message may be mythical, but it remains important if not addressed and countered.
  • Make sure customers know how they benefit from your product.  Don’t be “good enough” or “comparable.” Make sure the real benefits to customers of your product are front-and-center. As Clayton Christensen says, make sure you know what job the customer wants from your product and clearly fulfill that job better than alternatives. Don’t rely on the customer to figure out why your product is superior, make the case quite clearly for them.
  • Don’t expect customers to understand your pricing. Make clear your value proposition. Regardless how you price, the value proposition must be immediately understood. Link how you will get the job done for the customer to the value you provide.
Trump Vs. Clinton: Old Marketing Vs. Modern Marketing Will Determine The Winner

Trump Vs. Clinton: Old Marketing Vs. Modern Marketing Will Determine The Winner

Republican presidential nominee Donald Trump debates Democratic presidential nominee Hillary Clinton during the third presidential debate. (Mark Ralston/Pool via AP)

Whoever wins tomorrow’s election, their success will have a lot to do with how they marketed their campaign. And in many ways, selling a candidate is not different from selling anything else.

Do you remember the “four Ps of marketing” from Marketing 101? They are product, price, place and promotion. Every newbie is taught not to overly rely on any one, and greatest success comes from a well planned use of all four.

Product: The candidates are about the same age and health. And while they represent very different parties, both have spent less time talking about what a great president they would be, and a lot more on what a terrible product the other candidate is. Message after message has denigrated the other, to the point where we hear most of the electorate is now less than happy with both.

Most marketers know that negative marketing is risky, because it tends to tar all products with similar negatives. Greatest sales happen when you convince people your product is superior in its own right – not just compared to alternatives. Barack Obama figured this out in both previous elections, and he was able to convince the majority of people he would be a good president. Unfortunately, in this election the competitive attacks have cancelled each other out, and neither candidate has a majority of people liking them. An opportunity lost by both candidates to make their product more appealing, and thus bringing out more people to vote for them based on policies and the core of how their presidency would make voters happy.

 Price:  One could say that the tax policies of Hillary Clinton make her a more expensive candidate than Donald Trump.  However, the long-term cost of the debt increase from Trump means that the price of his presidency will be costlier than Clinton. Let’s just be practical and say that neither candidate has positioned themselves as the candidate better for everyone’s pocketbook.

Again, an opportunity lost. Ronald Reagan did a superb job of positioning himself as being good for people’s pocketbooks, and it helped him unseat Jimmy Carter. Barack Obama made hay out of the economic crisis as Republican George Bush left office, helping him convince voters that he would be far better for their pocketbooks – via job creation – than his opponent.

 Place:  This is all about “get out the vote.” Here the advantage clearly goes to Clinton. Candidate Clinton has done a superb job of building a “machine” that has turned out a record number of Democrats to early vote.  And she has worked diligently with her party to make sure local support exists across the country to help take people to the polls, and encourage voting on election day.  By making sure her constituents make it to vote, she will likely do far better at collecting votes than her opponent.

Additionally, candidate Clinton is not only campaigning, but she has a two former presidents campaigning for her, a sitting first lady, a sitting vice president and her key opponent from the primaries. This breadth of support, canvasing across multiple states, further puts her message into voters ears right before the election, and encourages people to go vote for her tomorrow.  Her large fundraising, and ability to offer funds to down-ticket candidates, has helped make sure her message was clear at the local level.

On the other hand, candidate Trump is walking a nearly singular path, with precious little party support. While he swept the primaries, he has not built a strong machine to make sure that those beyond the party faithful – those who are undecided or independent – are going to make it to the voting booth to help him be elected.  It is one thing to excite people about your product, it is another to make sure people actually invest the resources to obtain it.

In Trump’s case the advertising has been relentless, but the local machine support to turn out registered party voters, and everyone else who might enjoy his candidacy, is quite weak. One reason candidate Trump keeps saying the election is “rigged” is because he’s now realizing he failed to put in place the distribution system to get his voters to the ballot box.

Further, those who are helping candidate Trump secure his message are few and far between.  Outside of family members there are few making the case to get out the vote. Despite two living former Republican presidents and one vice president available, none is helping him be elected.  Likewise, despite a large number of primary opponents, most of which pledged their support for whoever won the primary, there is only one (Chris Christie) that has been a notable advocate for candidate Trump.

And the party itself has not been mobilized to get out the vote for candidate Trump.  His personal wealth has allowed Trump to implement a credible campaign.  But his inability, or unwillingness, to raise lots of money to invest in down-ticket races has meant he has not garnered support from other candidates running for Congress, Senate, governorships, etc. to promote his message at a more local level.

For months we have been inundated with polls. But on election day it is not someone calling your house to hear for whom you might vote. Rather, people have to leave their houses, make time in their busy days and go to the election booth – then stand in line and vote. Mr. Trump has not done the sort of job one would expect for building the support necessary to make sure voters turn out for him.

Promotion: This might be where the two marketing programs most differ.

Candidate Trump has relied on advertising. Years ago marketing programs often relied on huge ad budgets to build a brand. Companies quickly learned that if you spent a lot on advertising you could drown out a competitive message, and bring your brand to the forefront. Simply on the basis of a big ad spend, heavily reliant on television, success was once possible. And the Trump campaign has used advertising like a soap company launching a new brand. Lots and lots and lots of advertising.

Notably, there has been little use of digital, internet and mobile advertising. Little use of social media to build trends and increase brand effectiveness. The candidate himself has gone almost entirely against modern thinking about social, mobile and internet marketing by unleashing tweets which have been simultaneously shocking, and often opposed to the brand message the advertising set out to create.  While entertaining, this has not met even the minimum standards of modern marketing.

Candidate Clinton has matched candidate Trump in television and other traditional media advertising.  Thus, her candidacy has not been overwhelmed by competitive spending  While most people are likely tired of the ads from both candidates, it is clear that when it comes to traditional ad programs Clinton’s marketing has met the competitive level necessary to neutralize any possible Trump advantage.

But internet, mobile and social marketing has been much more successful for Clinton. Barack Obama did a splendid job of using these tools to mobilize young and minority voters in previous elections. This sort of marketing often touches people much closer, and has a greater “one-on-one” appeal, even if it is a modified “one-to-many.” And the Clinton campaign has lifted those guidelines, perhaps not as effectively as the Obama campaigns, to convert Sanders constituents to her as well as independents and undecideds.

The Trump campaign relied almost wholly on advertising, and an effort at achieving greater public relations via outrageous messaging. This has kept the candidate squarely in the public eye. But every marketer will tell you that it is not possible to build high commitment for your product with advertising alone. It takes an ability to touch people on a more personal, closer to home basis. It is critical now, more than for many years, to create identification with local issues within the home and workplace, and often reinforce social relationships.

At this, the Trump campaign has been out of step with modern marketing, and overly reliant on tools that were more effective in the ’80s and ’90s. Thus his appeal outside of European heritage, Christian, white and mostly male voter groups has struggled.

The Clinton campaign’s use of these tools has spread her base considerably wider. She has been able to connect with minorities, women, people of color, people of different religions and other groups much more effectively. In tune with demographic trends in America, this greatly enhances her opportunity to obtain the largest share of market. Tied to a superior placement campaign (to get out the vote,) this use of modern tools gives her a significant advantage.

These two campaigns have lessons for all business leaders. Too often we rely on product alone to think we will succeed. But product is only part of successfully luring buyers. You also have to make sure your product is in the right place, accessible to the most people, at time of purchase.

And today budget is only a part of good promotion, because effective use of social, mobile and internet marketing tools can help you connect with your targets more closely, and more personally. New promotion tools can expand your base, identify new target markets, develop strengths in niche groups and achieve greater loyalty at lower cost.

In history, there are almost no great campaigns that were won just because a product was superior.  Nor because a product was cheaper. And despite some great ad lines (“Where’s the beef?” or “Plop, plop, fizz, fizz oh what a relief it is”) advertising has limited ability to actually make a product successful.  Those that win build a marketing program using all four Ps most effectively to build on trends and excite customers.