For those of you who read about last summer’s visit to  Corazón de Ñaupas in Peru, I’m pleased to report that Polymer Studios is the proud sponsor of the town’s soccer club.

On my last night in the village, the club presented me with a formal request for sponsorship, typed up on the only typewriter for miles around, signed by the officers of the club and stamped by the local notary. Who could say no to such a proper business proposal? We’re contractually barred from disclosing the details of the sponsorship, but let me put it this way: in the past, the guys played in the clothes on their backs and the other teams made fun of them. Especially those jerks down in the rich city of Vinchos. Who’s laughing now, Vinchos?

We’re hoping to have a skybox installed in the coming year. Until then, our preferred seats at the home pitch are located on top of the big rock outcrop above the field. (No, not the one above the outhouse, but the other one near the cornfield.)

We wish the Ñaupitas the best of luck in the coming season, especially against those dirty dogs down in Vinchos.

It’s no secret that the advertising and marketing industry gets walloped quicker and harder than most any industry during a recession. At least that’s how it played out in the last dip and how it’s looking this time around.

If you look at some of the specific crises driving this recession you’ve got a perfect storm:

• The credit crunch caused by the mortgage crisis
• Disappointing 4th quarter retail sales
• The prospect of one or more U.S. automakers going under
• The very real threat to print media (see this and this)

It’s a domino effect goes something like this: Consumers can’t afford to buy > stores can’t sell > manufacturers don’t make > less money for ads > pink slips for creative types.

The headlines in the trade rags and elsewhere bear this out:

• Media agency forecasters pull no punches: Smith, Coen and King see little hope for economic recovery anytime soon (subscription required)
• Ads subtracting: Massive job cuts seen across Madison Avenue
• Magazine ads evaporated in 2008, faster as months went on (subscription required)
• Most media to suffer retrenchment in 2009 (extensive but free subscription required)

The predictions call for even more bloodletting over the coming months. Which is to say, we could be in for the worst of it.

So, what to do? If you’re an agency type, where will you hunt for sustenance? A recent article in AdAge points the way, citing several areas that might make for good hunting grounds. (Comments in parentheses are mine):

• Washington D.C. (new gov’t, new spending)
• Package goods
• DRTV
• Beer (couldn’t agree more!)
• Online video
• Hispanics (with 30+ Hispanic cousins, I can verify this one)
• E-books
• Public relations
• Cable TV
• Marketing consulting (it was true in the last downturn: companies shed FTEs then bring in consultants)
• Digital out of home (see previous post: The shopper marketing revolution)
• Mobile (I’m getting an iPhone this year, recession or no!)
• Pet care
• Marketing analytics (yet another nail in the coffin of print and broadcast, which is barely measurable compared to online)
• CBS (huh?)
• Luxury recycling (2nd-hand yachts for pennies on the dollar!)
• China
• Package and fast food (Can a boom in the weight-loss industry be far behind?)
• Online coupons
• Gun sales (that huge clicking noise was the sound of millions of NRA members locking and loading)

Photo credit: GlobalJet

• 70% of all purchase decisions are made in store.
• 68% of in-store purchases are impulse buys
• 68% of consumers are brand-switchers.
• Only 5% are loyal to one brand.

These numbers, which come out of a GMA/Deloitte research paper called “The Call for Shopper Marketing,” really bring into question how we’ve allocating our time and money in reaching out to consumers. All this advance effort to sell people on Brand X…and for what? They jump to Brand Z on a whim at the last second. I

I’m sure it still makes sense to prime the pump and create awareness about products via online, direct, broadcast, outdoor and print. But with so many decisions — correction — with so many impulsive decisions happening in the aisles, it seems that we are insane not to focus more on the so-called last mile.

Why isn’t there a stampede among creative agencies to develop expertise in this burgeoning field of “shopper marketing?”

Consider two additional statistics, also in the GMA/Deloitte paper:

• Each week, 127 million customers visit Wal-Mart
• Each week, 68 million people on average watch ABC, CBS or NBC evening news.

So, how is Wal-Mart trying to influence all these millions, perhaps billions, of weekly impulse decisions? Of course, there are the usual mainstays of retail merchandising, such as coupon dispensers, end-cap displays and product sampling. Experiential marketing is also getting more play.

But it’s well reported that Wal-Mart and many other retailers are putting their money on digital signage: intelligent networks of in-store flat-panel displays that can be managed to deliver infinitely localized and relevant messages, using variable data such as:

• Time of day
• Day of week
• Seasons an holidays
• Customer language preferences
• Store traffic patterns
• Weather
• Market and economic conditions
• Local news events
• Inventory levels
• Product sales velocity
• Sales goals vs. actuals
• Proximity sensors
• RFID readers
• User inputs (voice, touch, cell-phones, etc.)

For me, digital signage holds much of the promise that excited many of us marketers in the early days of online marketing, when we realized how we could use data to deliver ever more granular and relevant messages to prospects.

The difference is that digital signage all happens in the store. At the moment of truth, where, according to the research, our expensive ad campaigns and brand loyalty initatives come face to face with disloyal and easily distracted customers. Clearly, whoever has the ability to influence fickle consumers in the aisles has a tremendous advantage.

Photo credit: “Grocery shopping” by ralphbijker

You can find wisdom in the most unlikely places. I found this gem in a research paper about Warren Buffett by Michael Mauboussin of Legg Mason Capital Management (in which he references Nassim Taleb’s book the The Black Swan: The Impact of the Highly Improbable).

Humans have a near insatiable desire to link cause and effect. Unfortunately, causality is often very difficult to deconstruct, even in retrospect. But coming up with a cause and effect story helps settle our minds, and provides a greater (albeit false) sense of control as we face the future.

What’s your story? How do you explain your success or your failure? I know I’ve got mine

Talk of the recession is, well, everywhere. And it can get depressing.

So, where are the contrarians? Who’s looking for (and telling others about) the silver lining in this grey economy? Who’s trying to describe an alternate reality?

Well, here are a handful for you to consider.

Graeme Thickins, in The Clear and Simple Solution to the Current Downturn: The Entrepreneurial Economy,  at Tech~Surf~Blog sees salvation in good ol’ entrepreneurism:

The big answer to our current economic plight is not a new one: it is staring us right in the face. It has brought us out of many a recession before this one, and it will do so again. It is simply this: the ingenuity and perseverance of the American entrepreneur.

Graeme also points us to two particularly relevant posts:

• The “Downturn” — Keeping Things in Perspective, by Jay Turo at the growthink blog.
• Fear Kills Businesses Dead, by Brian Solis at TechCrunch

Ben McConnell at Church of the Customer suggests that the downturn, if anything, presents an opportunity for marketers to try ideas they might not have been able to successfully champion during the last boom. Among his more intriguing ideas:

Adopt the simpler and affordable Net Promoter Score.

Evangelize the benefits of Twitter-driven customer support.

Build a customer, supplier, vendor or employee social network on Ning.

Host internal seminars about design thinking.

Speak out against testosterone-driven “barbarian” mission statements. (ed: Kinder, gentler mission statements? I’d like to see that.)

Underlying all this talk of the recession is the question of fear. As Brian Solis’ post puts it, fear kills. It sucks your soul, at at time when you need all the energy and optimism you can muster. If you find yourself losing sleep over the economy, I highly recommend this post by Robert Middleton on his More Clients blog.

Finally, if you’re seeking out the brighter side of the economy (and happen to live in the Twin Cities), be sure to attend the next UnSummit on Sat., March 7. The theme is “Hacking the Recession” and we’ll be discussing ideas and tools that will help us improve our economic well being individually and collectively. Some of the proposed sessions include:

• Social media survival kit — a workshop to get you up to speed
• Getting good ideas when times are tough
• How to increase your employability using community and social media
• Blogging for fun, profit and survival

Photo credit: Alternate realities by James Jordan

At first glance, you could be in any classroom anywhere. The kindergartners are restless. Some have loud sniffles. A few of them crack jokes and laugh until the teacher asks everyone to quiet down and recite their vocabulary words.

Only the vocabulary words are in Quechua. The And outside the one-room schoolhouse, hovering in the doorway, actually, are all the parents. Mothers and fathers are beaming with imperfect smiles as they peer through the doorway, waiting expectantly to see if the kids need anything—a notebook, a pencil, perhaps a reminder to behave.

Even though we’re in the tiny Peruvian village of Hatumpampa, I immediately recognize what these parents are doing. They’re doting! It’s what my wife and I do with our kids back home in Minnesota. Now, I don’t speak a stitch of Quechua, nor raise llamas at 12,000 feet, but wanting to see your children succeed — that I can relate to.

I’ve come with my 10-year-old son Sam to Peru to see what life is like in the remote villages where Comunidad has been working. Places with names like Paccha, Culluhuanca and Corazón de Ñaupas. Places that are barely on the map, and after decades of neglect and civil war, just starting to claw their way back to normalcy.

After a day-long tour of the kindergarten classes at each of the villages, meeting teachers and parents and their adorable children (and eating the filling, multi-course meals that are proudly served to us at each stop) we settle in for a weekend in Corazón de Ñaupas.

“Corazón” is a cozy little town. Except for the three public buildings erected by the government and the oddly-angled soccer field that was literally quarried out of the hillside, it’s a collection of a two-dozen adobe farmhouses.

Hovering over the town on one of the hills are several rock outcrops whose eroded cylindrical shapes loosely resemble human figures. Someone suggests that the rocks gave the town its name, which means “Heart of the Ancestors.”

These “ancestors” have indeed helped keep the town safe over the years. During the civil war of the 1980s and 90s, villagers camped out in the hills above the rocks to avoid nighttime raids by guerrillas.

Today, this part of Peru is peaceful. The hills above Corazón aren’t for hiding, but for sunbathing and napping, as we discover on a lazy Saturday. From the hilltop, we can see the Paccha Valley spread out below us and eagles drifting on air currents above. Occasionally, the braying of a donkey or the bells of a llama caravan drift upward from who knows where.

Back in town, the soccer field is no longer a place for rounding up frightened villagers. It’s for soccer, volleyball and recreation. Over the course of our stay, we enjoy several heated volleyball matches that pull in seemingly everyone from the village as either player or spectator. To our surprise, the grade-school teacher is one of the most feared opponents. Her withering serve usually causes one of us to flail about and fall to the ground in a spectacular but failed defense.

And those government buildings are for schooling. As we learn during our stay, many of the parents of school-aged kids missed out on their chance at education. They grew up during the war, a time in which survival was a higher priority than arithmetic.

That might explain the high attendance in Corazón’s first-ever kindergarten class, which Comunidad has funded. Or the high participation in the breakfast program for kids all ages, which Comunidad also supports. These parents are hungry to see their children do better. It’s like they’ve been given a second chance. And they’re holding on for dear life.

On our last night, we’re asked to sit as guests of honor at a town hall meeting in the school building. The classroom is crowded. Many of the adults are squeezed into children’s desk-chairs. Others stand in back. Yet more adults—many of the same parents who sit outside this classroom every morning while their six-year-olds attend kindergarten—wait expectantly outside the door.

We listen to several speeches, some in Spanish, some in Quechua—nearly all of them emotional and teary-eyed. The speakers describe what the people of Corazón have been through these past years. “Many people have promised many things over the years,” the president of the community says. But with Comunidad it’s been different. As promised, Nancy Maldonado Cárdova, Comunidad’s kindergarten teacher arrives every Monday and stays all week to teach class. And when the kids of Corazón arrive in the morning (some of whom have walked two hours to school on an empty stomach), there is hot breakfast waiting. Most importantly, the kids have begun to show progress in school. It’s no exaggeration to say that many of them can now read better than their parents.

All this, he says, is just the beginning of a long and slow journey. But in this forgotten corner of the world, it’s what passes for hope.

If you enjoyed this story, please consider making a small donation to Comunidad.

Jason Billingsley of the Get Elastic blog recorded this interview with Darren Tomey, VP of Sales from Compendium Blogware, at the Internet Retailer Conference & Exhibition 2008 in Chicago.

I find it interesting that Darren uses organic SEO as the rationale for why big retailers should be blogging. I don’t disagree, but my first reaction would have been to say that retailers should blog in order to build communities.

Then again, if you do build a community around your blog, I suppose the SEO boost naturally follows (you’ve probably heard that search engines love blogs) and you end up in the same place anyway. So, not only is Darren correct, but he cuts to the chase and presents an argument that is more compelling to retailers, who are notoriously numbers oriented.

Incidentally, Connie Benson describes a conversation between her, Lee Odden, Albert Maruggi and Barry Judge about community building and SEO. Connie brings up a good question: If you engage in online community building (which could include blogging among other activities) with SEO in mind, should you make deliberate use of SEO keywords, which might result in stilted and possibly off-putting language? Or do you write au naturel? She seems to come down in favor of the latter and I have to agree.

Part 1: Dipping your toe into social media

This is the first in a 4 part series about how you can start a social media strategy program started in a risk-averse company. In part 1, we’ll start out very slowly and just dip our toe in to some of the basic platforms.

I’m sure you have a list of your favorite industry blogs, you’ve dabbled in LinkedIn and Facebook and you’ve even heard of Twitter. You undoubtedly know that you “need” to take advantage of social media to stay competitive, but you’re a bit overwhelmed and your company isn’t exactly sure it’s a good fit.

You know that connecting with your customers on a more personal level can improve your brand and your bottom line. You understand that social media can be a great way to influence behavior with minimal out-of-pocket expenses. And you realize that you’ll need to do something fast just to stay competitive. But, because you’re part of a large company, particularly if you’re in a highly regulated, risk-averse industry like health care or banking, your company may feel there’s just too much risk associated with that level of transparency. And thinking about shifting your marketing communications into conversations, your organization might feel like it would lose control over its message and its brand, and that there could be very real legal and IP considerations.

Here is an easy 4-day (or 4-hour) plan to dip your toe into social media. If you haven’t used these tools before, spend just an hour each week and you’ll be laying the groundwork for implementing a social media strategy for your company.

Day 1: Make it brief
Create a communications strategy brief. The operative word is “brief”. Don’t get bogged down in committee meetings, just create a one-page outline of who your target audience is, what your organization’s goals are for the next year and how you think your company and customers can benefit by adopting social media. Then, write down your top 3 concerns. This will be your guide throughout the process. It’s not set in stone, so feel free to update it at any time.

Day 2: Set up basic accounts
If you haven’t already, set up personal accounts on Facebook, LinkedIn and Twitter and start exploring. This will allow you to get familiar with what each platform offers without involving the company brand. Find a handful of people you know and start connecting with them. These can be friends, co-workers or thought leaders in your industry. The important thing is to explore without any grand agenda.

Day 3: Listen to the chatter
A fundamental benefit of social media tools that often can get overlooked is the ability to eavesdrop on conversations. You can search twitter posts, blog posts and reader comments to find out what people are saying about your brand, your industry and your competition. Here is two good places to start searching–just type in your company name, your product, even your name (come on, you know you want to):

• Search twitter
• Search blogs

What do you notice? Is there even anybody talking about you? Do you see any patterns? Are there people that you’d never heard of that your customers listening to? Did you find anything surprising?

Day 4: Participate in the community
You’ve created your strategy brief (you may have even updated it already), you’re more familiar with some of the core social media platforms and you’ve explored what others are saying about you online. Now it’s time to start participating. The easiest thing to do is to comment on another’s blog. Choose 3 of your favorite industry blogs and post comments on a couple of articles you find particularly helpful or interesting. Your comments don’t need to be lengthy or even deep. Eventually, you‘ll want to provide more insightful comments, but even thanking the blogger for their contribution or insight is enough. Your comments should be informal and authentic and this shouldn’t be used as an opportunity to directly sell your services. Just say what you would if that person were standing right in front of you.

What are you waiting for?
When you start using this simple plan, you’ll be laying the foundation for your company’s social media strategy with very little brand risk. You can do these steps in 4 days or 4 hours. The important thing is to take a little time each day or each week to explore and to participate. Become a part of the community you want to do business with.

In part 2, I’ll kick it up a notch and talk about how you can begin making the case to your risk-averse organization for adopting social media. Part 3 will talk about ideas for implementing social media internally. Finally, part 4 will discuss simple and low-risk ways to turn your social media program outward.

Photo by adactio. Creative Commons image license.

Consider the costs that go into producing a typical corporate annual report. Photo shoots, creative creative concept development, copywriting, design, layout of the financial section — we haven’t even gotten to the killer cost — printing and mailing hundreds of thousands of copies across the globe.

It all adds up quickly.

So, with stock prices in the tank and shareholders ready to pounce on even the appearance of waste, I wonder how many companies will consider doing their stockholders a favor and simply publish the annual report online?

I don’t mean simply posting a PDF of the report. Many companies do that, but the results are not terribly user-friendly for shareholders.

Rather, the ideal online annual is a small site within your Web site that tells the story of the previous year in text, images, video, animation, interactive, etc.

Besides the obvious savings on paper, printing and postage, putting the annual report online offers some serious advantages.

• Everything is measurable – Who reads your annual report? With paper, you may never know. With an online report, however, every visit, link and click can be measured, analyzed and used to make a better, more cost-effective report next year.
• Video is stickier than text - Got stories to tell about last year’s business? Film it and show it. Is your CEO letter tearfully boring? Get creative and film the CEO in an unusual surrounding: at the stores, in the field or in the factory. Would you rather watch two minutes of that or read a page of 10-point sans-serif?
• Take the shareholders’ pulse - You can build polling and surveys into your online annual report in order to gather valuable information from your investors.
• Boost your search engine ranking - What do you think will assist your SEO efforts more: a PDF of your printed annual hosted by an investor relations service…or the same content, in highly searchable HTML, hosted at your own domain?
• Make the data downloadable – Some investors like to crunch the numbers. Why not make your data available for download in a CSV file?
• Create sharable content – You can set up your online annual report so that many of its components (slideshows, videos, commercials, audio, images, etc.) can be redistributed easily by others (bloggers, reporters, fans, etc.), thus increasing your audience beyond investors and helping to spread your story. In a good year, you’ll add to the number of people who have heard about your success. In a down year, you’ll add to the number of people who have heard about your plans for improvement.

Of course, for compliance reasons, you may need to provide your annual report in printed form, or at least to those who request it. To that end, you can print a small quantity of bare-bones reports (mostly numbers, no fluff) and/or make a pared-down report available for download.

Examples of online annual reports
In case you haven’t seen any online annual reports, check out the ones below:

• Coca-Cola Company (This is the 2006 report. I see that they went to a menu of PDFs for 2007. Wonder why?)
• Sutter Health
• Constellation Energy
• Memorial Sloan-Kettering Cancer Center (This report combines online multimedia with downloadable PDFs of the print version, a nice compromise.)
• MeritCare Cancer Committee - (Full disclosure: MeritCare is a Polymer Studios client.)

So, what’s a vigilant corporate lawyer to do? Nothing, according to Bruce Johnson, partner at Davis Wright Tremain, LLP, in this video interview from MyRagan.com.