Month: January 2016

H&R Block’s Not-So-Ordinary Giveaway Gimmick

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If you’re a working American, you know it’s tax season. And for the first quarter of the year, the airwaves are awash in tax preparation advertising. Leading the charge is H&R Block, continuing its “get your billions back, America!” themeline, developed by their lead agency Fallon.

This year, they’re executing a major promotion, which started about a week ago. They’re giving away $1,000 per day to a thousand people who walk in to an H&R Block office over the course of 32 days. I’m not great at math, but that’s $32,000,000 in cash being given away by February 15th.

One of their spots is a fun, hip-hop themed, music-video-styled approach called “1,000 Washingtons.”

And they can afford it. The company earned approximately $2.3 billion in tax preparation revenue last year. They’re spending about 5% of revenue (which is right on target,) or roughly $100 million in US measured media in addition to the $32 million in given-away dollars.

This is a gimmick, pure and simple. And normally, that would be seen as a four-letter word on this blog, and among most practitioners. To be clear, a gimmick shifts the focus away from the consumer and on to the brand. When a brand runs a campaign and says “hey look at us! Look at what WE’RE doing! Look how cool WE are,” it’s generally considered cheesy, to use a technical term.

Under the surface, the brand is trying to induce early filing (on or before February 15th.)  It’s good for the company’s earnings, and doesn’t, um, tax the Block filers with a crush of returns in the last 60 days of the filing period.  So you can see how the gimmick is a convention set in place to serve the needs of the brand, not necessarily to serve the needs of the consumer.

However, this is a REALLY SMART gimmick, because, while the promotion is about what the BRAND is doing, the focus is squarely on the consumer, and what he or she might get if they use Block to file this year. So Block wins twice: they win on differentiating the brand from other tax prep companies, (nobody else is giving away this kind of coin,) and they win because the consumer is thinking ONE thing and one thing only: “I may get money if I file with Block.”

Did you hear that? The consumer is thinking “I may get money…” If you’re in the tax prep business, and you’re trying to lure consumers into a brick and mortar store to file their taxes early (which is done by only about slightly less than half of all filing Americans,) there is simply only ONE thing you want them to think: I may get money.  Forget the fact that the promotion will only award 32,000 in-store H&R Block filers out there:  a ratio of about 2 out of every thousand people.  Better odds than the lottery, but not a lock by any stretch of the imagination.

Marketing, and specifically, the promotion pillar of marketing, is mostly about managing perceptions of consumers. We can’t control what consumers do, or how they behave, or where they shop. But how they perceive the offerings, claims and other messages of influence is totally fair game, and why agencies who develop those messages are so critical to the success of brands.

In the big picture, then, Block is winning as a marketer by centering their advertising around a promotion that is focused on the simple meme “I may get money.” In the tax prep business, that’s what you want your consumer to think. (Even though millions of Americans will end up owing the government money.)

Add to this that the core theme of Block’s advertising (for the past two years) is “get your billions back America,” and you see how seamlessly this fits in with their overall messaging strategy. That’s a cohesive messaging plan at work. Nicely done, H&R Block.

The Law of Commonality

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This morning, I saw two strangers meet on the street. One gentleman looked at the other, and in a language I couldn’t understand, seemed to ask the other: “do you speak this language?” The other replied with what I imagined was “OH HECK YES I DO!” and the two immediately began engaging. They smiled widely, embraced one another, and began to chat away.

They had something in common, and it was that commonality that broke down barriers and transformed these two strangers, for a moment at least, into fast friends.

I believe the same thing is going on with brands and consumers all the time – and I call it the Law of Commonality.

The Law of Commonality states that consumers are constantly striving to belong in some way, and will gravitate to people, communities, and brands with which they perceive a shared affinity or common origin.

Brands are constantly trying to appeal to consumers, based on the wants and needs that consumers present. And since brands are in competition with one another, they strive to reach consumers on a plane that sounds both appealing and differentiated.

You’ve seen and heard this in action a thousand times: “Are you looking for more free time?” “Is your hair thinning?” “If you’re looking for a different kind of family vacation…” All of these opening lines are obviously just a method of weeding out those that might not be interested in what the brand has to offer. But it’s also a method for the brand to implicitly achieve some kind of common ground with a consumer, based on what the brands ALREADY know about what the consumer desires.

On its own, that doesn’t sound too ground-breaking. But we have to remember how consumers are wired. Humans, by nature, are tribal. We look to join communities, and we favor those communities that are based on shared interests and common traits.

And it works equally in the opposite direction:  never do you feel more lonely or more isolated than when you perceive that you DON’T belong.  Ever been the guy wearing the only blue jersey in a stadium full of green ones?  I have.  Yeccch.  That is one looooooong walk back to the car.

This type of innate socializing activity (that occurs unconsciously for the most part,) serves a high level Maslow-ian need for belonging and puts us squarely on the path to that which we desire most:  affirmation (respect by and of others.)

Think about social media and its immense popularity. It’s not our extrovertedness that has transformed social media platforms into multi-billion-dollar behemoth corporations, but rather our need to belong, cloaked in a more socially-acceptable disguise of joining communities based on common interests and affinities.

Further, The Law of Commonality states that consumers are more likely to buy from a brand that they believe has something in common with them and/or their value system than from an equally qualified brand that does not.

If the consumer believes that a specific brand “really gets” who they are, or has “an interest in the same things I do,” that brand is already well ahead of its competition. And there are some pointed examples of brands that have done this very well, and made good on this simple human driver.

Harley-Davidson is one. Here’s a brand that recognizes a certain set of consumers and their deep-seated desire for freedom and exhilaration. The motorcycle is literally and figuratively a vehicle to take them to that special place. But more than that, the brand represents a bond of brotherhood with others who are a lot like you, even though they may look different.

Jeep has accomplished something similar with their unique auto designs, and a common interest in the outdoorsy lifestyle shared by most Wrangler drivers. American Express has achieved a level of common bond by referring to their customers not just as cardholders, but as “members.”

Belonging to the same club, enjoying the same activities, speaking the same language, having gone to the same college, rooting for the same sports team – any of these are more than good enough reason to create some kind of bond between people, and the same is true between brands and consumers.

It’s not the ONLY thing that fuels a purchase of these brands, but it’s certainly a tick mark on the invisible checklist that the consumer is invariably carrying around in his or her mind. And as consumers browse and compare, those tick marks that make us feel (a very important word here,) like we belong to something bigger – indeed a community of like-minded people that we can both respect and be respected by – usually add up to a level of preference and a favored status.

As you plan your marketing and brand initiatives, no matter how large or small, ask yourself how you can achieve commonality with your consumers. You’ll likely create a bond that goes way beyond just the first purchase.

VW: follow-up to previous post

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Back on November 11, 2015 I wrote a post entitled “Das Issues: What’s Next for Volkswagen?”    In it, I discussed the emissions scandal, and what I thought the brand could do to start the process of reconnecting with current customers and reaching out to prospects.

At the end of the post, I made a suggestion that went like this:

If I was a brand consultant for Volkswagen, (full disclosure: I’m not, but certainly available!) I would start by going back to what helped build their perception: The dorky little outsider that promised the moon and modestly delivered it. My very next ad headline (think full page insertions in The New York Times, Wall Street Journal and USA Today,) would probably read “11 million Lemons.” And the body copy would go on to overtly apologize for the transgression, and then outline the steps we were taking to make good on our (new) promises and deliver exceptional automotive engineering.

And then I’d invite consumers to come along for the (literal and figurative) ride to redemption. Das Step 1.

So I was just poking around today and saw this article about Volkswagen. As you can see, it’s written on November 17th.  It talks about how VW started running full-page insertions in The New York Times, The Washington Post and The Wall Street Journal.  The headline reads “We’re working to make things right.”  And the CEO apologizes for the transgression, and begins to outline some steps to make good.

Kooky, huh?