This is the latest article I’ve written for the Public Gaming Magazine, published in the August/September 2016 edition.
Lottery agencies face a unique set of business challenges which we’re all familiar with and trying to tackle on a daily basis. They include:
- Player fatigue with big jackpots,
- Difficulty identifying and reaching the next generation of players.
- Rising operating expenses mean that each dollar of incremental growth comes at a higher cost
- Cracking the code on successful digital engagement
- Better utilizing digital throughout the POS experience
However, there is an even more important challenge most lottery agencies face and that directly influences the performance of their business. I am referring to an agency’s corporate culture, and the fundamental role it plays in driving innovation, growth, profits and employee satisfaction.
In fact, a lottery’s ability to tackle its business challenges is directly related to the strength of its corporate culture.
So, what exactly is a corporate culture?
When in doubt, we can start with Wikipedia:
Corporate Culture (or organizational culture as it is often referred to) represents the collective values, beliefs and principles of organizational members and is a product of such factors as history, product, market, technology, and strategy, type of employees, management style, and national culture. Culture includes the organization’s vision, values, norms, systems, symbols, language, assumptions, beliefs, and habits… Thus, organizational culture affects the way people and groups interact with each other, with clients, and with stakeholders. In addition, organizational culture may affect how much employees identify with an organization (Source: Wikipedia)
So: the corporate culture represents the unique style and policies of an organization as expressed by the beliefs and values of its employees. As well, and perhaps most important- the corporate culture is also seen in the official and unofficial behaviors deemed as acceptable or desired inside the company.
The peculiar and sometimes dangerous aspect of corporate cultures is that they don’t have to be consciously created in order to exist and seriously affect a business, for better or for worse-they can just as easily be a remnant of a past management legacy.
Or perhaps, the corporate culture is not clearly defined at the top of the organization or changes too frequently because of constant management changes. Then, subcultures will take over that are usually more driven by the preservation of a department rather than the thriving of the organization. And that makes sense! In absence of a clear vision and a clear set of values and accepted behaviors, it is human nature for employees to default to behaviors that create a subculture that will help them preserve their own domain and jobs.
Jeremy Gershfeld, founder of Corporate Culture & Communication firm Quartet Approach (http://quartetapproach.com/) believes that it is not easy to get a concrete grasp of a company’s corporate culture. A analogy Jeremy likes to use to describe corporate culture is the unique way one’s own family might do things and interact with each other. For example, think about visits with your family over the holidays. At a large family gathering, you might notice how family group habits can distort your own behavior. You might observe, over, say, Thanksgiving dinner, how different members of the family do things very differently, and how this affects the group’s behavior as a whole, especially when the full group is brought together.
Of course, the stakes are different in a professional environment, where individual and group goals are different than getting along with your relatives for a few days. However, the culture still exists, and the group is often bound by its social dynamics.
The lasting value of a strong corporate culture
Harvard Business School Professors Jim Heskett and Earl Sasser and coauthor Joe Wheeler assert in their new book, The Ownership Quotient, that strong, adaptive cultures can foster innovation, productivity, and a sense of ownership among employees and customers. They also outlast any individual charismatic leader.
While all these benefits are highly relevant for lottery agencies the last one is particularly salient, as lottery Executive Directors will change every few years and each new ED will bring their own sets of priorities, values and styles of doing business.
As Catherine McIntyre-Velky, a project management and process consultant who has worked with First-The-Trousers on a process optimization project for the Arizona State Lottery says: “One cannot under estimate the power of culture and its influence on productivity, especially in an environment that deals with regulations. A good strong corporate culture is as much a part of the process as the process itself. In order to successfully navigate deadlines and approvals, you must be able to speak the currency and understand the communication exchange.”
“Your culture is your brand.” (Tony Hsieh, CEO of Zappos)
The idea that corporate culture is a strategic asset has become increasingly popular over the last few years. The most shining example, of course, is Zappos: the world’s largest online shoe store, known amongst other things for its “Wow” customer service and its philosophy of delivering happiness to both employees and customers.
Zappos CEO Tony Hsieh captures his beliefs in this quote: Our belief is that if you get the culture right most of the other stuff like great customer service or building a great long-term brand or empowering passionate employees and customers will happen on its own. He should know: his company was acquired by Amazon in 2009 for $1.2 billion.
“Culture eats strategy for breakfast”
This quote is from Peter Drucker, management consultant and business thought leader whose writings contributed to the philosophical and practical foundations modern companies perhaps more than anyone else. He argues that having a strong corporate culture is actually more important for a company’s success that a well thought through strategic plan. In the same vein, Harvard Business School Professor Emeritus James L. Heskett (and author of “The Culture Cycle”) finds that as much as half of the difference in operating profit between organizations can be attributed to effective cultures.
As such, improving ones corporate culture should be seen as an opportunity for an industry, like the lottery, that struggles with operating costs growing faster than sales and the resulting pressure on profits and revenue contribution.
But, lottery Agencies face unique cultural challenges
Lottery agencies face two unique challenges with regard to their corporate culture:
- Lottery agencies are government agencies and therefore cannot incentivize their employees based on their performance like a private organization would. This in turn has a direct impact on employee morale.
- Every few years a new Executive Director is appointed to head the lottery agency directly impacting the agency’s culture in ways that may be surprising. Many of the lottery employees we’ve talked to across the country over the years describe their tenure with the agency not in numbers of years (“I’ve worked here for 15 years”) but by the number of Executive Directors they’ve worked under (“I’ve had 9 Executive Directors”). This point matters because of the crucial role the corporate leaders have in defining and implementing the organizations culture.
These challenges can leads to “dysfunctions” within a lottery agency that directly impact performance, employee motivation and profits. Some of the symptoms of a weak lottery agency culture are:
- Lack of clarity within the agency with regard to the agency’s objectives and how to achieve them. While the core objective of a lottery agency is clear, or should be (increase the revenue contribution to the state) Executive Directors tend to provide their own interpretation of the agency’s objectives and how to achieve them. This interpretation, of course, has an immediate impact on the culture and the priorities set by the broader organization.
- Intra- and inter-departmental silos and lack of alignment: A lack of unified culture that everyone can live by often leaves each department or even each individual to pursue their individual objectives. This leads to subcultures that may not necessarily be aligned with the organization or with other departments (but that are aligned with their understandably natural need for job security). This often leads to a lack of coordination and collaboration between and within departments which again directly impacts the overall business performance.
- Lack of communication & accountability. A weak culture is also often defined by a lack of transparency or accountability in the decision-making process. Employees in one department don’t know for sure what people in other departments do. Critical information is often poorly documented and not easily accessible. The default behavior becomes to only share information if needed or if actively requested.
- Lack of appreciation for subject matter expertise. Another symptom of weak corporate cultures is often a general lack of understanding or appreciation for how others do–or could–contribute to the mission. On a personal level this often means that individuals do not feel appreciated or valued for their roles and contributions.
Improving ones corporate culture.
The first task for any organization looking to improve its culture is to actually try to define its current culture and assess its strength by asking a few basic questions:
- Is the agency’s vision and core values clearly defined and consistently understood by everyone within the organization (can everyone within the organization tell you in a few words what the vision and core values are)?
- How motivated are the agency’s employees? How valued and appreciated do they (really) feel?
- Is there transparency and cooperation within and across departments or is the cooperation hampered by formal or informal silos?
- Does information flow freely within the organization or it is “hoarded” by specific departments or individuals?
- Is the decision making process (RACI framework) within the organization transparent and it is clear who is accountable for what decisions?
These questions are basic yet fundamental. And while you’d think or hope that he answers to those questions are obvious, the reality is that they often are not. However, I am always surprised, and I’ve talked to many people working in the lottery industry over the last 5 years, by how open and willing employees generally are to share this information candidly when asked (though maybe they are more willing to open up to an outsider).
Imagine your organization is a music group
Undertaking an objective self-assessment of ones’ corporate culture can be difficult. Because of that, understanding how to evolve your corporate culture isn’t easy either.
For example, imagine your organization is an orchestra playing a symphony. How would it actually sound? Does your group sound like a harmonious masterpiece that transports you into a different world or does it sound like the cacophony of uncoordinated and un-synchronized noise (think first-grader annual Christmas concert)? Be honest with yourself.
The illustration of how a quartet can either produce beautiful music or just noise based on how well coordinated and in-synch the quartet members are is at the core of Quartet Approach’s consulting philosophy. Based on an upfront audit which identifies the strengths and weaknesses of your organization’s culture, Jeremy Gershfeld and his team let you actually experience what your organizational culture ’sounds’ like now and what it could sound like in the future. In Jeremy’s own words “The Quartet Approach personifies what happens when the rehearsing and performing group of four musicians plays a substantially better group performance when the elements of their culture are healthy (as well as hearing/observing what happens when culture is not). It becomes very clear what happens when, for example, a lack of clarity in the group’s roles create a psychologically unsafe setting”.
Translating the strength and weaknesses of an organizational culture into music often creates an “aha!” moment and the discussions that result from these insights of one’s organizational culture can help determine alignment, communication, and expectations.
Corporate culture has become an increasingly relevant subject in the business world over the last 10 years as companies have come to realize the role it plays in sustaining a competitive advantage and building a business. It is especially relevant in the lottery industry which faces its own specific challenges that could be overcome with decisive movement toward a stronger corporate culture. This type of corporate culture exploration and refinement might therefore be worth exploring as an opportunity to improve the performance and revenue contribution of lottery agencies.
Know thy self,
Know thy enemy.
A thousand battles,
A thousand victories.
Most good stories, including brand stories, include an antagonist, a rival, an enemy that the hero (and his followers) has to go up against and sometimes fight. Cain had Abel, Luke Skywalker had Darth Vader, Tom had Jerry, and Apple had IBM.
Identifying and taking a stand against an enemy can be a very effective mechanism to grow and differentiate a brand or to associate it with a broader world view.
An enemy can be a potential threat (real or assumed) consumers might not be aware of (think freezer burn which is made up or all the invisible bad germs threatening your children), another segment or sub-segment in the category (for example Mini positioning itself against the big gas guzzling SUV when it was launched in the US) or a cultural or social belief, convention or behavior that may be relevant to your category and brand (for example the beauty standards used in media versus Dove’s campaign for real beauty).
The options are limitless and will be best defined by your brand unique situation, its competitive and cultural context as well as the values of the people you are trying to appeal to.
Identifying and taking a stand against an enemy can help create relevance for your brand, provide your customers with a sense of coherence and belonging, provide validation in the brand choice and create a sense of urgency to act. It can also help re-frame and increase relevance of an argument as demonstrated by the anti-smoking organization American Legacy Foundation (Truth) which successfully focused on vilifying the executives of the large Tobacco companies as a way to prevent young adults from smoking.
Identifying and taking a stand against an enemy to create more energy and traction for your brand is just one of the 26 universal approaches to successful brand positioning development and storytelling. The other 25 can be found here.
The evolution of the internet has given moms the tools (blogs, micro-blogs, fan pages and social media in general, Pinterest, Instagram, etc.) to express their individual and collective voices and to find, bond and connect with like-minded moms. In the process, they have created their own massive sub-culture expressed by the stories and experiences they share, the values around motherhood they communicate and their behaviors.
This sub-culture is not that new though to be honest (at least not in internet years). But this culture still remains largely untapped by marketers. It often seems as if brands mainly look at this cultural eco-system as a media or distribution channel rather than a source of learning and insights on how to engage and communicate with moms. It is therefore not surprising that, according to M2Mom.com (LINK), 73% of moms feel that advertisers don’t really understand what it’s like to be a mom and that 80% of moms feel that brands are doing a poor job at connecting with them.
So what are some of the elements that define this (mommy) culture and how can brands leverage those insights to better connect with and engage moms?
1. Don’t be so serious, Laugh with them (not at them).
“I shall maintain a sense of humor about all things motherhood, for without it, I recognize that I may end up institutionalized. Or, at the very least, completely miserable”. It is no coincidence that the need for humor is the first point captured in the popular “Mommy Manifesto” written by Jill Smoker, the mom behind the very successful “Scary Mommy” franchise. In fact, humor is a great “mechanism” most moms use to gain some distance from their everyday reality, bond and connect with others moms or just maintain their sanity. Insightful humor is also one of the most powerful ways to create engagement on a social media platform like Facebook. And yet most marketers seem to insist on portraying the serious, caring, multi-tasking aspect of motherhood.
2. Take a stand, represent a point of view, but avoid being patronizing:
Marketers know how important it is for their brands to have a clear point of view. That’s even more important for brands targeting moms. In fact, new moms have so many, often confusing, decisions and choices to make about everything that they will naturally gravitate towards brands that embrace a clear and relevant point of view and purpose and thus provide a welcomed short cut in this decision making process. The danger however, like with any point of view, is for the brand to unintentionally come across as patronizing. Polarizing is good. Patronizing is not. The line between the two is extremely thin, especially with moms. That’s the difference between Toys R Us (toys are more exciting than a field trip), a company you’d expect to know moms, and Goldieblox (empowering girls to become engineers).
3. Emphasize “personal stories and experiences”:
Ask the editors of the HuffingtonPost or simply look at what type of stories resonate most in the HuffPost Parenting section and you’ll learn that personal stories resulting from personal experiences are the new social currency. Personal stories and shared experiences are also the primary form of content on most mommy blogs. They are the means moms use to share, express themselves and bond with others without being patronizing or judgmental. They provide the content other moms can identify with (or not) and help create a sense of community most moms crave.
4. Celebrate the anti-hero and stop using idealized stereo-types:
Every mom will tell you that parenting is really hard and far removed from the ideal vision she had before getting pregnant. But most moms will also take a certain pride in the daily struggles of motherhood. A simple look at the stories moms share online makes this obvious. They celebrate the imperfections, struggles, embarrassments and mistakes they experience daily and find comfort in knowing that the others moms struggle too. The new ad from Coke Green from Argentina demonstrates this point brilliantly.
In that context, continuing to use idealized stereotypes of the perfect mom is the best way for a brand to distance itself from the reality of motherhood, act tone-deaf and fall in that category of brands “that don’t understand moms”.
5. Focus on the woman, not the mom.
Have you ever wondered why there are so many moms who blog out there? I believe the short answer is that after focusing for 6 months of 24/7 feeding and changing diapers moms crave a creative outlet for personal self-expression. That’s also why so many mommy bloggers actually dislike the term mommy-bloggers (and prefer “bloggers”). Subtle but significant difference. Moms are one of the most targeted audiences and brands are willing to pay serious premiums for a share of their attention. Yet some of the strongest, and unfulfilled, need states a mom has are personal and relate to her as an individual, not in the context of her role as a mom: the needs for “me-time”, for escapism, for validation and comfort and for self-expression to name only a few. “Moms Who Need Wine”, a wine distributor built a very successful business around this simple understanding. So instead of trying to communicate your brand as a means to perfect motherhood, it might be worth trying to establish it as the solution to an individual need most moms have (while still helping her fulfills her role as a mother). So instead of looking at a meal your kids will love as the expression of good motherhood, look at it as a way for a mom to get a 15 minute break and me-time (which she will if the kids eat and love what they eat). She’ll reward you for this understanding with her business.
As we all know, moms are big business. The 85+ million moms in the US represent a spending power of $2.1 trillion (Babycenter.com) and there isn’t really a category that isn’t directly or indirectly influenced by the way a mom feels about it.
The challenge is that most advertisers do not understand moms. In fact, that’s what moms themselves will tell you if you ask them. According to M2Moms (www.M2Moms.com):
- 73% of moms feel that advertisers don’t really understand what it’s like to be a mom
• 60% of moms feel like marketers are ignoring their needs
• 80% of moms think advertisers are doing a poor job at connecting with them.
The speed with which the current environment has evolved makes this problem even more pronounced. Who would have guessed two years ago that mobile and social platforms such as Pinterest would play such a dominant role with moms today? Who knows what they will gravitate towards in two years. In that environment it is crucial to have a finger on the pulse on what is going on in moms’ lives.
Prior to launching First-The-Trousers, I co-founded http://www.wemothers.com, an online community catering to the emotional needs of moms. I created an online community of 10.000 moms on a $0 budget, purely through developing engaging content and by connecting emotionally with moms in social media. Through doing so, I gained an intimate and in-depth knowledge of this highly valuable and influential consumer segment.
I applied this understanding to a blog entry I wrote for the HuffPost titled “24 Clear Signs You’re a Mom” which within 72 hours was viewed by over 4 million readers and generated over 300K “likes” and 100K “shares”, a clear sign that it resonated with the readers, most of them moms. So, while we shy a little away from self-proclaimed expert status at FTT, we’ve learned a little about creating content that can reach millions of moms and can apply this knowledge and expertise by helping brands better connect with moms.
If you’re interested in getting a quick immersion in today’s mommy culture and want to understand what resonates with moms:
1. Read this blog entry entitled “5 untapped opportunities to connect with moms” which shares some of our experience building a community of 10.000 moms.
2. Read through this Slideshare presentation
3. Or, watch these “9 Most Popular Advertising Campaigns for Moms in 2013″, a list we compiled for and published on the Huffington Post (click on the picture).
Is your core audience moms? First-The-Trousers can help you position your brand is a way that will resonate with moms, develop new product ideas they’ll find valuable and useful and develop communication strategies across channels they’ll find engaging and share-worthy. To find out how we can help you, please contact us here.
Interesting presentation by comic Adam Conover about the Millennial myth. A nice complement to our own research on Millennials and “The 10 Habits of Highly Effective Millennial Marketers”. Worth the 20 minutes if your target is Millennials.
Craft Beers: a compelling sub-segment brand story
The last decade has been host to a quick rise of craft breweries in the U.S. According to the Brewers Association, there are now 4269 breweries (2015) in the country, 99% of which are classified a small and independent breweries. In 2015 alone, there were 625 new breweries that opened their doors, while only 68 closed. The craft segment now represents 21% of the category in terms of retail dollar value. And during the last ten years, the category has been growing double digits for eight years out of those ten. Considering an overall declining beer category, this is pretty impressive.
Behind these impressive numbers are even bigger social and cultural changes. In fact, craft breweries have helped change consumers’ expectation of what a beer is or should be, just like Starbucks changed consumers expectations of what coffee could be. This has put a tremendous amount of pressure on the large national brands as well as the broader liquor category.
The business reality is that eventually the whole segment will stabilize. Many breweries will be content with a local or regional market position. Some will disappear. Others again will be acquired by the large breweries and be turned into national brands. The last group of craft beers will try to expand their businesses with an eye toward national growth.
The unavoidable need to evolve the craft beer brand stories
Compelling stories sell brands, period, and this holds true in the beer category.
And while the craft beer stories (place of origin, their obsessive founders, the styles/flavors they brew or their creative packaging) have captured the imagination of a whole generation of beer drinkers better than the national mainstream brands have, their story is generic for the craft beer sub-segment as a whole. The inherent associations with craft breweries will become generic over time and slowly lose their motivational appeal. If fifty different craft brands brew an IPA with the same hops inspired by their respective founders’ shared belief that beer should have big flavor, and the vast majority of that fifty package the end result in an aluminum can that makes heavy use of oranges, reds, and yellows, at some point it’s hard not to become background noise.
Strategically, this means that these craft beer brands will have to evolve their positioning platform beyond the craft beer territory and explore new brand stories that would appeal to a broader consumer segment while helping the brand differentiate itself from the hundreds of other brands fighting for national attention and market share.
A natural starting point: the brand and the right consumer segment
On the international level, this is what Fosters did with its “Australian for Beer” campaign a few years back. In fact, it shaped and reinforced peoples’ perceptions of what Australia was (through the defining attributes of its people) and turned it into something people all over the world could aspire to.
Another decision these brands aspiring to a national presence will have to make is what consumer segments to focus on. PBR became the brand of choice of hipsters, Modelo, one of the fastest growing brands in the US, first grew its presence within the Hispanic community before trying to broaden its appeal to all beer drinkers in 2015. And so forth.
Exploring alternative brand narratives
If the current brand story provides a compelling platform for national growth, great. If not, the brand will have to explore new positioning territories. The good news is that for an informed and experienced strategist, the options and choices are plentiful. Below, we’ll list a few positioning thought-starters and brand narratives that have all proven successful and that all could become the seed of a compelling national positioning platform and brand story:
- Identify a compelling role for the brand to play in peoples’ lives: this could include claiming and occupying the ideal/typical emotional territory for consumers (think Corona), owning a typical consumption occasion, validating consumers self-image, acting as a cultural or social symbol for its consumers (think Molson Canadian) or re-defining the category standard in terms of perceived quality (think Stella Artois for example).
- Create a more compelling and differentiated product story, this can include the brand’s defining attributes, its ingredients, its brewing process (think Bud Ice), the sensory attributes of the brand and the meaning associated with those attributes (taste, color, smell, etc.).
- Reflect the aspirations and reality of their core audiences and thus create identification and bonding. This can be done by reflecting consumers’ values, relevant needs and lifestyle or by addressing specific concerns the target audience might have.
- Re-position competition (both within the beer category and beyond). This could be done by exploiting a competitive weakness, by occupying underserved but relevant category needs and emotions, by resolving a category paradox, by further educating the consumers and by helping them evaluate the qualities of a brand (beyond name and taste) and by introducing new types of benefits.
For a strategically educated eye, there are a lot of potential options to tell a compelling brand story that would have national appeal and that would enable a regional craft beer to expand nationally.
The narrative examples mentioned above aren’t random. Instead, they have been generated using First The Trousers’ proprietary positioning development tool (Positioning Roulette) which identifies the 26 universal approaches to brand positioning and brand story telling (you won’t find a 27ths) based on the analysis of over 1200 case studies of effective brand building.
Using Positioning Roulette for a systematic and informed exploration of those 26 universal brand positioning approaches will enable the right brand team (in the context of a workshop, for example) to identify all positioning options available to tell a compelling story for a specific brand. Further, it allows you to quickly validate the most promising one, something no other positioning methodology provides with this level or rigor and speed. This methodology also provides a strong framework to help differentiate various brands within the same brand portfolio. Positioning Roulette works for both new and established brands and can even help identify new product and positioning territories for further exploration.
It will be interesting to see how the craft beer sub-segment and the larger beer brands in general will evolve their brand story over the next few years. It will also be interesting to see what brands achieve national stardom and what brands will disappear.
One thing is for sure though: only those brands who proactively think about the future and how to evolve their brand positioning and brand stories in order to adapt and help shape the market will survive.
Please feel free to contact us to find out more about Positioning Roulette and how this methodology can help your brand.