Category: * Mindful

Is it a Sin to Advertise Religion?

5/21/2023

by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

In casual interpersonal conversation, two topics have long been taboo: politics and religion. By contrast, in advertising, politics are usually fair game, but religion has largely remained off-limits, until now. So, have two widely broadcast religion-related campaigns changed an age-old mass communication commandment?

By now, most people have driven by billboards or viewed videos online for “He Gets Us,” the omnipresent ad campaign aimed at changing people’s perceptions of Jesus. The campaign even aired ads during last February’s Super Bowl.

More recently, another campaign, which represents religion for some but with a very different objective, also has been broadcast in national media: #StandUpToJewishHate aims to stop antisemitism. The need for such an initiative stems in part from the sobering statistic that the American Jewish community represents just 2.4% of the U.S. population, but Jews are victims in 55% of the country’s religious hate crimes.

Given my past and present advertising-related roles, people sometimes ask my opinion about ads, and because I teach at a Christian University, my views on marketing that involves religion has some extra appeal.

However, as much as I enjoy sharing my thoughts, I really appreciate hearing others’ perspectives, from which I always learn. So, in the current case of these two high-profile campaigns, I reached out to a few wise friends and asked for their insights on the ads.

One person is a Christian church pastor; the others are Jewish – a software project manager and an executive coach. For the sake of brevity but at the risk of some awkward acronyms, I’ll refer to these kind contributors anonymously as CCP, JSPM, and JEC, respectively. Here are their reflections on the ads.

He Gets Us

In light of ongoing critiques of Christians and Christianity, CCP admitted having mixed feelings about the He Gets Us ads. Still, he was grateful for the campaign’s positive portrayal of Jesus.

JSPM and JEC also appreciated the ads. JSPM was particularly impressed by the campaign’s inclusivity, emphasized through third person plural language. He reflected, “Our world could certainly use more ‘us’ than ‘them’ . . . When we allow people to dehumanize others, bad things happen.”

Likewise, JEC was very impressed by the He Gets Us ads, which he found to be “incredibly open-minded” as they presented an accurate picture of Jesus, who was not close-minded.

Notwithstanding these positive attributes, CCP posed an important bottom-line question about the ads: Are they effective? More specifically, he wondered:

“The ads’ portrayals of Jesus highlight his love and grace, but do they clearly communicate to their audience who He is? Also, are those short dramatic snippets enough to cause someone to explore more about Jesus?”

Furthermore, knowing that purchasing national media isn’t cheap, and a 30-second Super Bowl spot can cost as much as $7 million, CCP asked the very reasonable question of whether taking practical actions would be more meaningful than words:

“While our Christian witness is important, do television ads or addressing the needs of people who are hurting provide a better representation to our world of who Jesus is and what He and his followers value?”

Still, CCP remained circumspect, “Maybe the fact we’re having this discussion is proof the ads are accomplishing their purpose.” He’s right: This kind of general image/brand-building is very difficult to quantify, and so much free press is likely helping, at least to some extent, to offset the costs.

#StandUpToJewishHate

As mentioned above, JSPM denounced dehumanizing actions and the acrimony that often underlies them. He added, “The abundance of hate in our society is crowding out love and is dangerous on many levels.” The hateful words and actions the #StandUp campaign seeks to discourage exemplify some of the more advanced forms of that abuse.

JSPM appreciated how each campaign, though very different in their focus, aimed to replace the prevailing narrative with a better one, i.e., Jesus was about loving others, and it’s wrong to radiate hate.

JEC supported the #StandUp ads’ goal of combatting hate and protecting people. He also fittingly differentiated the two campaigns, pointing out that while He Gets Us focuses squarely on Jesus and highlights specific spiritual disciplines He demonstrated like self-control, unconditional love, and hospitableness, #StandUp makes no mention of a deity or reference to specific tenets of faith.

In addition, JEC raised two good questions:

How should the funding sources for both campaigns affect the ways their respective ads are interpreted?
Do the #StandUp spots really represent religious advertising?

Admittedly, the second question surprised me as it challenged the fundamental framing of this piece and the logic: ‘Because the #StandUp campaign encourages rejection of acrimony aimed at Jews, and because Judaism is a religion, the ads are religious advertising.’

However, JEC reminded me that not all Jews consider themselves as adherents to Judaism, i.e., Jewish religion. For some, being Jewish is about cultural/and or ethnic identification, not necessarily religious beliefs and practice. So, although antisemitism may involve religious bigotry, it’s more broadly discrimination against specific people who are identifiable outside of their theological beliefs.

JEC’s analyses of the campaigns were also a good reminder that people, including me, see ads through the lens of their own worldviews and experiences, which can lead to very different interpretations of the commercial content. Those potential discrepancies are why it behooves those creating ads to step outside themselves and truly try to understand others’ perceptions.

The three interviewees provided some excellent analysis of the two specific campaigns, but what about the general idea of religion using paid-for mass communication? Is it right for religious organizations to advertise?

Considering this question, JSPM and JEC both pointed to the First Amendment’s protection of free speech. Outside of hate speech and a few specific requirements like truthfulness, individuals and organizations of all kinds do have great liberty to publicly disseminate information and to attempt to persuade people to believe and act in certain ways.

Still, the messages of religion-related ads cut deeper than most, which means religious organizations should strive to:

Promote in proper situations: Ensure that ads appear at appropriate times and in appropriate places.
Be inclusive: Use language that’s welcoming rather than exclusionary.
Seek common ground: Emphasize points of agreement.
Avoid offending: Don’t disparage others’ beliefs.
Be compassionate: Understand the difficult challenges that many people face each day.

Not surprisingly, these are many of the same principles that the three contributors to this piece have identified and implied. Furthermore, following these principles doesn’t mean abandoning the tenets of one’s faith; rather the principles suggest not leading with antagonism.

It’s also helpful to recognize that most religious organizations’ advertising does routinely uphold these principles. These organizations are not necessarily using national television campaigns like the ones discussed above but rather promotional tactics like these:

A synagogue buys newspaper space to advertise an annual flea market fundraiser.
A church runs radio spots to promote its Christmas-themed musical.
A new mosque uses outdoor signage to announce its opening.

This kind of religious advertising commonly accomplishes the organizations’ objectives and upholds values that virtually everyone understands, like decency, fairness, honesty, respect, and responsibility.

There are examples of good and evil mass communication in every sector. Religious advertising isn’t always pious, but when done in the right ways, it radiates “Mindful Marketing.”

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AI Ethics Need Time

4/8/2023

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

At the same time Major League Baseball (MLB) has made a revolutionary rule change to speed up America’s pastime, some renown business leaders have called a timeout to slow down the planet’s hottest new technology. In a world that places a high priority on time, is it fair to ask organizations to hit pause on artificial intelligence (AI)?

With many believing that notoriously long baseball games have outlasted the attention spans of fans now conditioned for shorter bursts of entertainment, MLB made the game-changing addition of a pitch clock, which already seems to be serving its purpose of expediting play.

However, sports don’t always imitate life. Concerned about the meteoric rise of AI and its potential abuses, over 18,000 people have signed the Future Life Institute’s open letter that asks all AI labs to “immediately pause for at least 6 months the training of AI systems more powerful than GPT-4.” Among the notable signatories are tech leaders Elon Musk and Steve Wozniak and 2020 presidential candidate Andrew Yang.

Most of us have heard of at least some ethical infractions attributed to AI that range from the art tool Midjourney slyly outfitting Pope Francis in a longline white puffer coat to complaints that an uncensored chatbot continually offends human decency.

In light of such concerns, some marketing professionals have joined ranks with their tech colleagues and said that the proposed pause on AI development is, akin to Keebler cookies, “an uncommonly good idea.” On an even larger scale, Italy recently became the first western nation to ban ChatGPT.

However, not everyone agrees that an AI pause is necessary. While major brands like Coke, Duolingo, and Expedia are increasingly leveraging the power of ChatGPT for their digital marketing, Microsoft has gone much further, making multimillion dollar investments in Open AI, the app’s owner.

Also questioning the prudence of the open letter and proposed AI pause are “some prominent AI ethicists” and Microsoft co-founder Bill Gates, who has said, “I don’t really understand who they’re saying could stop, and would every country in the world agree to stop, and why to stop.”

Gates’ issue with the AI pause doesn’t seem to be so much that he believes it’s a bad idea in principle as he fears its unilateral implementation, i.e., many around the world won’t honor the halt. As Microsoft’s largest single stockholder, Gates understandably doesn’t want the company to fall behind in the AI race.

Gates elaborated on his AI perspective saying, “Clearly there’s huge benefits to these things… what we need to do is identify the tricky areas.”

Coming from someone who is a prolific reader and arguably one of humanity’s greatest intellects, “tricky” is a very interesting choice of words.

Gates probably didn’t mean “tricky” in the sense of sly or deceptive, but rather he chose the adjective to convey that AI issues are complex, delicate, and intricate. Either way, the word is very informative for the approach to ethics that should be taken with AI.

When a bomb squad comes upon an unrecognized incendiary device that it needs to deactivate, and one of its members says, “This is going to be tricky,” it’s probably not code to pick up the pace and rush headlong into the defusing process. Instead, “tricky” would likely signal to everyone on the team that they should slow down and think, “How exactly do we want to go about this?”

Based on the educated opinions of tech experts who know much more about the potential risks and rewards of AI than do most of us, the transcendent and ever-evolving technology is potentially explosive, or “uncommonly” “tricky.” Some of the potential pitfalls include information accuracy, privacy, intellectual property, offensive content, attribution, and impact on humans' livelihoods.

When it comes to tricky ethical issues, it’s not only okay to pump the brakes, hit pause, and take a beat – it’s desirable. Moral choices shouldn’t be rushed; rather, they often benefit from more time to allow for:

Consideration of other opinions: Any given person’s, organization’s, or industry’s perspective is naturally limited and usually biased to some extent. It’s very helpful, therefore, to engage other stakeholders who can offer divergent views, or at least ask good questions.
Better projection of likely outcomes: A danger of rushing through a product trial is that some consequences only become known over time, after they happen. Such a long-term delay of launching may not be practical, but additional conceptual testing is usually possible and is likely to identify other probable occurrences.
Deeper reflection on pertinent principles: Identifying what specific moral issues are at play in a given situation requires very intentional analysis. Determining what particular courses of action are decent, fair, honest, etc. requires even greater contemplation.

Unfortunately, a MLB pitcher facing a full count on a prolific home run hitter can no longer take extra time to gather himself before throwing the next pitch. However, even though the game of high tech is moving at a very rapid pace, there is no pitch clock on AI ethics.

Gates is right that not everyone in the world will hit pause on AI development at the same time, which is concerning. But why, then, not apply the same logic to an issue like greenhouse gases? Certainly not every organization or nation is working to reduce their CO2 emissions; yet, Gates is, thankfully, a vocal advocate and large financial supporter of mitigation efforts.

In ethics, it’s not only tenuous to try to think too fast, it’s also ill-advised to reason: “Others won’t take a stand, so why should I?” Pumping the brakes on new technology is not always needed, but given AI’s life-altering potential, some extra time to talk and reflect equals “Mindful Marketing.”

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Turning Trash into Treasure

1/1/2023

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

A few weeks ago, I walked into Lowe’s with an old piece of wood to have its dark green and ivory paints color matched. After the paint department associate carefully inspected the top of the 6” x 12” sample to find the best matching areas, she flipped the piece and glanced at the unpainted side. Her eyes widened as she read the bold stenciled text: HIGH EXPLOSIVES – DANGEROUS.

I could tell she wanted an explanation, which I was happy to give: The story behind the formidably labeled wood has personal meaning and is also a classic example of what has increasingly become a very positively impactful business model – upcycling.

Sometime around 1940, my grandparents gave my mother, their only child, a very special Christmas gift: a Lionel locomotive, a tender car, and three pullman cars. Barely beyond the Great Depression, the O-gauge model train was likely a very significant purchase for a coal miner and homemaker. However, the gift involved much more than the train.

My grandfather, who had good carpentry skills, meticulously constructed a miniature neighborhood for the train that consisted of several small outbuildings and two larger houses. He lettered one roof with “A Merry Christmas” and the other with “A Happy New Year.”

Each home had a front porch with posts, a door, and several windows, for which he made coverings from different colored tissue paper. He placed a small light fixture inside the homes so that when plugged in, a warm glow shone through their windows.

He painted every building dark green and trimmed them with ivory, as he did the large 4’ x 8’ plywood base on which everything rested. That’s the reason I was in Lowe’s – to buy paint to touch up the platform and some of the 80-year-old buildings that I was working to restore.

My grandparents were not people of means, and building materials were likely in short supply at the time, so my grandfather used materials that were available to make the holiday train display. Inside one of the houses was cardboard from a very old sugar box (Franklin Sugar Refining Company, Philadelphia, PA) that he used to line the windows’ edges so the tissue paper wouldn’t easily tear.

The wood for the buildings came from crates that he carried home from his work in the coal mines. The reason for the "DANGEROUS" labeling is that the cartons originally contained what was commonly used for coal mine blasting – dynamite – manufactured by the no longer-existent Hercules Powder Company.

It’s amazing to think how my grandfather repurposed the discarded packing from one of the world’s most destructive forces to create something beautiful that continues to bring others happiness 80 years later.

His labor of love, turning blasting powder crates into holiday buildings, is one of the best examples of upcycling I’ve seen. In an age of cheap material inputs and mass production, the possibility of upcycling receives little thought from most. Fortunately, though, some organizations are taking it seriously.

What exactly is upcycling and why does it matter?

Merriam Webster defines upcycling as recycling something “in such a way that the resulting product is of a higher value than the original item,” thereby creating “an object of greater value from a discarded object of lesser value.”

The main benefit of upcycling, or “creative reuse,” is intuitive: Items that may have otherwise ended up in a landfill, gain new useful life, thus both reducing waste and the need to expend the resources to produce as many new products.

Through its eco-friendly approach, upcycling can help mitigate sobering statistics like these:

“Americans generate an average of nearly five pounds of trash per person per day, totaling 292.4 million tons—half of which ends up in landfills.”
“Apparel was responsible for some 2.1 billion metric tons of greenhouse gas (GHG) emissions in 2018—about as much as France, Germany, and the United Kingdom combined.”
“The average U.S. consumer throws away 81.5 lbs. of clothes a year.”
“In America alone, an estimated 11.3 million tons of textile waste – equivalent to 85% of all textiles – end up in landfills on a yearly basis.”

Given its inordinate contribution to global waste, it’s fitting that many fashion industry firms have become leaders in upcycling, which British Vogue has called “the biggest trend in fashion.” A few of the brands spearheading the movement are Outerknown, Re/Done, Zero Waste Daniel, Urban Outfitters, Beyond Retro, and Fanfare.

Support for upcycling’s effectiveness in reducing waste also comes from empirical research. Experiments in one study found that between 50% and 80% of used garments could be upcycled into new ones.

While the fashion industry may be leading the charge, it’s far from the only sector driving the upcycling movement. A few other company examples include:

Sword & Plough creates wallets, bags, and jewelry from surplus military materials.
Hipcycle designs jewelry and home décor, among other products, from upcycled items.
Preserve makes kitchenware and toothbrushes from recycled goods.
Upp! UpCycling Plastic uses plastic waste to make new recyclable plastic products.
Looptworks creates limited edition travel-oriented apparel and bags from materials rescued from other vendors.

As people anticipate a new year, the saying, ‘Out with the old, in with the new’ is sometimes spoken. Change is often good, but constant new products can come with high economic and environmental costs.

Companies that upcycle help control those costs for themselves and others. Their good stewardship could coin a new saying: ‘Remake the old, relish the better.’

The term upcycling didn’t exist when my grandfather turned dynamite boxes into holiday houses for a model train set; however, companies today that follow his example can also create happiness for years to come as they practice “Mindful Marketing.”

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Ensuring Ethical Advertising

12/18/2022

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

We’ve all said things we later regretted. Fortunately, a personal apology can often atone for such individual indiscretions. Advertising gaffes, which may reach millions, are much more damaging and difficult to roll back, so why do some of the world’s most creative companies and brightest people continue to make promotional faux pas, and what can be done to avoid them?

When people think of advertising, they often envision iconic Super Bowl commercials like Budweiser’s Clydesdales playing football, model Cindy Crawford sipping a Pepsi, or basket legends Michael Jordan and Larry Bird competing at H-O-R-S-E for a McDonald’s meal. They probably don’t picture “children holding teddy bears in bondage gear.” Unfortunately, that’s the image that many people now associate with the luxury brand Balenciaga.

The century-old Spanish fashion house recently made headlines for the wrong reasons when it released a series of ads that not only featured kids posed with adult-themed props but also included photos in which appeared “paperwork about child pornography laws.”

Severe backlash against the brand has included stinging social media posts and celebrity condemnations. Balenciaga, however, is no stranger to controversy. Among its other contentious tactics have been “selling destroyed sneakers for $1,850” and “sending models who looked like refugees down the runway carrying trash bags made of expensive leather.”

The company has apologized for its latest gaffes, with representatives saying that they take “full accountability for our lack of oversight,” as well as that they are “closely revising our organisation and collective ways of working.” Balenciaga’s creative director Demna also offered a mea culpa, saying that it was "inappropriate to have kids promote objects that had nothing to do with them."

It would be convenient if Balenciaga could be considered some kind of an advertising anomaly, but unfortunately, over the years, other companies have made their own promotional blunders, some arguably as bad or worse than that of the high fashion firm, for instance:

Dove created a campaign in which Black women pulled their t-shirts off over their heads, transforming into white women.
Reebok put up posters that read “Cheat on your girlfriend, not on your workout.”
In a commercial called “Pipe Job,” Hyundai used a man’s failed suicide to show that its vehicle produced no harmful emissions
A line-up of uniformly thin young female models served as the central visual for Victoria Secret’s “Perfect Body” ad.

It’s easy to scoff at these ads and think, “How could those companies be so rash to release such obviously offensive advertising?” “Couldn’t anyone see the probable PR crises and pump the brakes?”

Of course, hindsight is 20/20, and it’s easier to criticize than it is to create. It’s also hard to know the circumstances surrounding the decisions. Still, here are two misguided motives that probably contribute to what seems like a never-ending series of advertising missteps:

1) Coveting Awards: The goal of any advertising should be meaningful ROI for the client, e.g., brand building, website views, sales. However, those practical objectives can fall prey to creative staffs’ desires to win advertising awards like Clios and Webbys.

To achieve such recognition, some advertisers feel needs to test social norms and push moral envelopes. Meanwhile, consumers sometimes see uber-creative ads but when asked what they’re for, they respond, “I have no idea.”

2) Creating Buzz: Relatively few advertisers compete for major industry awards, but millions would love their organization to be the focus of the next viral video. Unfortunately, the very unique content that people love to share with friends on social media is often not what translates directly, or at all, to bottom-line advertising results.

Worse, things like sexually explicit images may stimulate thousands of shares, but they also have negative impacts on social issues such as body image and gender stereotypes and ultimately backfire on the firms’ brand images.

Those are two of the most likely reasons why morally questionable advertising occurs, but what can be done to avoid it? Here are four strategies that can help:

1. Create a culture of questioning: People at all organizational levels need to feel they have the freedom to ask things like, “Could some people find this offensive”? or “Is there approach that would be equally effective but less risky?” If employees worry they’ll be shunned or punished for raising a red flag, those kinds of questions will seldom arise.

Crafting such an open culture is much easier said than done, but a few necessary prerequisites are top management support, rewarding people for asking hard questions, and continually reminding associates of the desire for moral accountability.

2. Identify corporate values: One of the best reminders of where a company stands ethically is a clearly articulated set of moral standards. Some companies suggest such principles in their mission statements. Other firms go a step further and outline a list of corporate values, such as these that form the foundation for Mindful Marketing:

Decency: avoiding behavior that people tend to regard as crude, heartless, immodest, obscene, profane, or vulgar
Fairness: treating others equally based on their personhood and equitably based on their individual contributions
Honesty: not lying or distorting truth
Respect: holding others in high regard
Responsibility: fulfilling duties to others, especially those that society tends to marginalize

3. Avoid time pressure: Given that most of us don’t do our best work when rushed, a hastily created ad campaign will likely suffer the same results. It’s helpful when there’s time to put new work aside and return to it several hours, days, or weeks later with fresh eyes that can then more clearly see any shortcomings.

Similarly, it’s much better to identify serious deficiencies, moral or other, early in the process. People increasingly resist change as more effort and expense are invested. It’s best to nib potential ethical offenses in the bud.

4. Ask for assistance: After we’ve been exposed to something for a period of time, it becomes harder to see it objectively. In fact, we may even forget about the thing, like a painting on the wall of our home, until a visitor’s comment reminds us it's there.

For any significant work, it’s very helpful to ask others to review it. Inevitably, they’ll see things we missed. For an ad, that should mean at a minimum of others outside the department or division, and perhaps someone outside the organization. Companies ask consultants to advise them on all kinds of business strategies. Given the havoc that an ill-conceived ad campaign can wreak, they also should ask outside experts for ethical input.

Balenciaga wasn’t the first and, unfortunately, won’t be the last advertiser to overstep moral boundaries. However, steps like those above can guide firms around ethical infractions. Making morality an advertising priority alongside creativity is “Mindful Marketing.”

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Financial Stardumb? Celebrities Endorsing Investments

12/4/2022

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Famous people have promoted products for centuries, encouraging others to buy everything from cereal to cigarettes. Cryptocurrencies recently tapped celebrity associations with great success, but a notable bankruptcy and the industry’s slide have led to serious financial fallout for many investors. Such unfortunate events beg the question: Should celebrities ever play the roles of investment advisors?

Babe Ruth promoted tobacco products. Doris Day endorsed a steamroller. George Foreman may be better known for his namesake grills than for his storied boxing career. Over the past couple of years, many celebrities inked endorsement deals in the new and fast-growing realm of cryptocurrency. Those who have attached their names to the digital dinero include:

UFC superstar Connor McGregor with Tiger.Trade
Tennis great Maria Sharapova with MoonPay
Rapper Snoop Dog with a variety of crypto exchanges
Actor Matt Damon with Crypto.com

However, probably the most infamous crypto partnerships have been between the now bankrupt Bahamas-based cryptocurrency exchange FTX and a lineup of all-star athletes and A-List celebrities, including: Tom Brady, Gisele Bündchen, Stephen Curry, Kevin O’Leary, and Naomi Osaka.

Even when products have little connection to celebrities’ specific talents, star-studded endorsements are often very effective for a few reasons:

Celebrities grab attention. If you’ve ever seen a celebrity in an airport or walking down a city street, you probably watched them for at least for a moment.
Individuals are very interested in the lives of famous people and those who know them. That’s why there are crowds of royal watchers and television shows like Basketball Wives.
People often want to pattern their lives after those of celebrities. Gatorade famously capitalized on that inclination a few decades ago with its “Be Like Mike” ad campaign, and most other celebrity-based promotion includes a similar inference – if you buy this product, you’ll be at least a little like the star who’s selling it.

While I know a little about advertising endorsements, investing and cryptocurrency are not my wheelhouse, which led me to reach out to two colleagues who have both that skill set and knowledge. I asked each to share his thoughts about celebrities endorsing financial products.

Jansen Hein, is the chief financial officer and chief operating officer at Illinois State Board of Investment (ISBI) where he actively manages all portfolio operations, business operations, and finance/accounting related functions and processes for ISBI, a $24B+ state pension asset investment agency. Before joining ISBI, he served as a certified public accountant and consultant for more than eight years with Ernst & Young.

Dwayne Safer is a finance professor at Messiah University where he teaches courses in Financial Management, Corporate Finance, Security Analysis and Evaluation, Financial Institutions Management, and Investments. He holds the designations of CFA, CFP, and CAIA. Before entering higher education, he was a senior vice president of corporate strategy & development for Citizen’s Financial Group and a director of investment banking at Stifel Financial Corp.

As their brief bios suggest, both men have extensive financial backgrounds that make them well-qualified to discuss what constitutes reliable investment advice, as well as who should offer it. Given those credentials, I was somewhat surprised that in their initial responses, neither expressed absolute objection to celebrities endorsing financial products:

Hein: “An ethically run business could see benefit from getting their message/product out through the use of celebrity endorsements, and I have no issue with that.”

Safer: “I don’t have a problem with celebrity endorsers of financial products and companies; however, the public oftentimes has difficulty separating the popularity and likability of the celebrity personality from their lack of expertise and knowledge in the company or product they’re endorsing.”

While both of these experts are open to the possibility of celebrities endorsing financial products, the preceding qualified responses foreshadow their more fully articulated beliefs, which detail significant criteria to meet in order for such sponsorships to be good for consumers. Together they construct three main hurdles that effective and ethical financial product purveyors must clear:

1) Transparency
To illustrate what celebrity spokespeople shouldn’t do, Safer references the recent case in which the SEC fined Kim Kardashian $1.26 million for her failure to disclose that EthereumMax paid her $250,000 to promote EMAX tokens on her Instagram account. He contrasts her incomplete communication with that of Barstool Sports founder Dave Portnoy, who was upfront that he received an ownership stake in the ETF BUZZ in return for promoting it in his tweets.

Safer similarly contends that organizations must be transparent in terms of whether they are investing individuals’ money, like mutual funds, ETF’s, and hedge funds do, versus simply serving as custodians of those funds, like brokerage firms and banks often do. As an example, he points to FTX, whose clients thought the exchange was only acting as a custodian of their money, when in reality it was investing it in a crypto hedge fund of a sister company, Alameda.

2) Trust
That kind of transparency is key to earning investors’ trust, as Hein shares: “To me, decisions regarding financial services providers must come down to personal trust. Regardless of the product/provider.” He adds that although he is not personally inclined to extend such trust for financial decisions to celebrities, he recognizes that some consumers are, in which case they must understand and accept the risks, while the celebrities and the businesses that employ them are culpable for any deception, intentional or not.

Hein believes that trust of service providers is especially important in the case of investing because laws often lag behind industry practices, legal enforcement is sometimes lax, and many organizations simply choose not to self-regulate. He also emphasizes how the unique nature of investment risk necessitates more than typical trust:

“We are not talking about buying a $100 product, with limited downside, but about investing in ways that may materially impact a consumer's current and future stability. The scrutiny of consumers should be different for any financial services marketing than for other products.”

Safer also underscores consumers’ responsibility for determining who to trust, referencing FTX and suggesting that the exchange’s use of a large number of high-profile “finfluencers,” e.g., Kevin O’Leary and Larry David, appeared to be “a ploy to engender the trust of the public so that they would invest in the growing crypto craze through FTX without doing basic diligence on the company.”

3) Technical Competence
Deciding who to trust is an age-old social challenge that extends far beyond investment relationships. The character of the other person is certainly one of the main trust criteria. Another is their competence, i.e., Are they able to do what their role in the relationship requires?

In the case of celebrities promoting investments, their financial competence is a very legitimate question. It’s not surprising that both Hein and Safer, whose extensive experience and education have provided them with such expertise, wonder whether most celebrities know what’s needed to competently endorse financial products. The two agree that, unfortunately, celebrities’ popularity often appears to be more persuasive to consumers than any financial proficiency they may possess:

Hein says, “Consumers must accept that their willingness to be persuaded to make financial transactions based on a celebrity endorsement may have little/no meaningful merit on the quality of the product or service. Is Steph Curry a financial professional? Is Kim Kardashian an investment professional? I am not saying that these two individuals are foolish or unwise (both are extremely successful at their crafts/professions).”

He continues, “What I am suggesting is that it is very possible that either (1) they are making these endorsement determinations themselves and we must acknowledge their limitations in doing so or (2) they themselves are relying on the advice of other financial professionals regarding the products/companies they choose to endorse — individuals we as general consumers do not know or necessarily trust.”

As shared above, Safer says he has no problem with celebrities endorsing investments, but he is concerned that “the public oftentimes has difficulty separating the popularity and likability of the celebrity personality from their lack of expertise and knowledge in the company or product they’re endorsing.”

He expands that belief with a more specific example: “I may think Tom Brady is the best QB of all time, but I’m pretty sure he knows very little about crypto and how crypto assets should have been custodied at FTX. In fact, he’s likely just collecting a big check from FTX and not caring about the details.”

Should celebrities endorse financial products? Neither Hein nor Safer offer an unequivocal, “No,” but together they use the tools of transparency, trust, and technical skills to paint an exacting picture of investment advice done right that’s undoubtedly very challenging for most famous spokespeople and their firms to replicate.

However, in the rare cases in which such a portrait can be perfected, celebrity investment endorsers can play a supporting role to “Mindful Marketing.”

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When Organizations Give Thanks

11/20/2022

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

At Thanksgiving, individuals often express gratitude for what they’re personally appreciative, e.g., family, friends, health. It’s less common to hear of organizations’ gratitude, but if they were to count their blessings, what would they be? Answers to that question could provide each of us with valuable perspective and perhaps help recalibrate our own thoughts of thankfulness.

These have been tough times for organizations in most industries. Factors such as inflation, natural disasters, health/safety concerns, and supply chain setbacks have made it very difficult to succeed, and in some cases to survive, let alone to give thanks, for instance:

A chip shortage has plagued tech firms and many other manufacturers.
Shipping companies have had to navigate record-high fuel prices.
In the first half of 2022, natural disasters led to insurance losses of $39 billion – 18% higher than average.
The slowdown in the housing market, an industry that impacts many others, shows no signs of subsiding.

This isn’t the kind of news most companies care to celebrate, nor should they. Yet, even under dark clouds, strong organizations see silver linings and reasons to be thankful. Although organizations can’t speak, their leaders have unique vantage points from which they can identify and express genuine collective gratitude.

I recently reached out to colleagues/friends in several industries who lead for-profit and nonprofit organizations, asking each to share something for which their organization is thankful. Their following five responses have enlightened and encouraged this marketer and hopefully will do the same for anyone who looks to see the good in business and other enterprise.

1) Messiah University: I begin with my own organization and employer whose president, Dr. Kim Phipps, reflects, “At Messiah University, we are grateful for increased enrollment, financial stability and a cohort of new innovative partnerships that broaden our institutional scope and impact.”

No organization exists without demand for its products and services. For more than a decade, demand for higher education has declined throughout much of the nation, mainly because of demographic trends. I know many at Messiah echo President Phipps’ deep appreciation for our students as well as other institutional partners who embrace the University’s mission and invite opportunities to extend it.

2) West Shore Chamber of Commerce: The leader of the second organization, another nonprofit, expresses similar gratitude for continued demand for its services. As the president of West Shore Chamber of Commerce (WSCC), based near Harrisburg, PA, George Book, Jr. articulates his organization’s appreciation:

“At the West Shore Chamber of Commerce, we are thankful for our members, first and foremost. We are also thankful for the communities we serve. We have the privilege of being located in South Central PA, which is a very diverse economic region that allows us to reach and help many different types of businesses. I am thankful for the grit and determination of our business leaders to keep our region strong and work together to positively impact our businesses and communities.”

Few organizations were hit as hard by the pandemic as WSCC since the services of most chambers of commerce rely heavily on in person events, which COVID 19 largely cancelled. So, when Book speaks of the dedication and resilience of his Chamber’s members and their communities, he speaks from heartfelt experience and is understandably eager for opportunities that lie ahead.

3) Pierson Computing Connection, Inc.: The first for-profit company of the set is thankful for a different but equally important stakeholder group. Deb Pierson serves as president and CEO of Pierson Computing Connection, which she founded in 1993. She says, “We are primarily grateful for our people. We have a great team that values deep relationships and embraces our core values. Without our people, Pierson wouldn’t be growing and thriving.”

Some may find it ironic that the leader of a company that supplies technological solutions places greatest importance on its people. However, Pierson rightly recognizes that it takes dedicated and gifted people to manage software, install hardware, and train others who will use them. Great technology doesn’t matter much without great employees who are highly skilled in its use.

4) LINKBANK: When people of a certain age think of banks, they likely envision people – tellers, loan officers, etc. When Brent Smith, president of LINKBANK, considers his bank’s people, he sees much more than the roles they fill:

“We are grateful at LINKBANK to have deeply committed staff members who are passionate about our clients, communities, and each other. We are also very appreciative of all the employees’ families and the ongoing support they give, allowing each of us to pursue our passions in the workplace.”

Good leaders know that their staff members are also spouses, mothers, fathers, daughters, etc., with responsibilities outside the workplace. Leaders like Smith also are very grateful for the support that these family members graciously give and, in that way, also help to fulfill their firms’ purposes.

5) Ten Thousand Villages: Finding people who will work for pay and effectively support a nonprofit organization’s mission can be difficult. Identifying dedicated volunteers who will do so can be extremely challenging. The realization of both of these goals has led Dan Alonso, the CEO of Ten Thousand Villages to share:

“We are thankful for the passionate people who are part of the greater Ten Thousand Villages family/network and who go above and beyond to support our mission, often with no direct connection to the organization itself. We also have a core of devoted staff members who want to make a difference and who continue to do so on a daily basis, despite the challenges of being the rare combination of a mission-based nonprofit and a successful retail organization.”

As is the case for many nonprofit organizations aiming to fulfill their unique missions, creating fair trade market opportunities for artisans around the world requires a special combination of devoted staff members and faithful volunteers.

A university, a chamber of commerce, an IT company, a bank, and a fair-trade retailer: One might guess that they would be thankful for very different things, but ultimately the gratitude of each reflects the same priority – people.

Although it should happen each day of the year, in this season of Thanksgiving it is particularly fitting for every marketer and other organizational member to renew their appreciation for the individuals who purchase their products, provide their services, and in other ways partner to help fulfill their missions.

Thankfulness can be a recalibrating factor and a grounding force for each of us. It’s also an important prerequisite for “Mindful Marketing.”

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Play with a Purpose

10/19/2022

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Bobby eagerly opens his Happy Meal box, tossing the chicken nuggets and fries aside to find the special toy tucked inside. Kids have repeated that ritual for decades, but Bobby is 32. While it’s nice that McDonald’s and other companies increasingly meet the need for nostalgia and help grown-ups relive childhood highlights, is selling sentimentalism a good adult-use of time and resources?

Cobranding with the apparel company Cactus Plant Flea Market, McDonald’s recently released a limited-edition Happy Meal intentionally targeted to adults. At $12.69 each, the big kids’ meals aren’t very wallet friendly. They’ve also disappointed some who couldn’t find a restaurant that had them or who got Cactus Buddy, the apparel brand’s mascot, instead of the classic McDonald’s character they wanted.

Still, buzz has been strong and sales brisk, leading some to conclude that “the promotion has been hugely successful for McDonald’s.” The fast-food icon is just one of many firms that are playing on nostalgia to target adults for kids’ products, for instance:

American Girl Cafes host birthday parties and other gatherings just for grown-ups and the dolls they bring.
Play-Doh has created several varieties of its finger-friendly clay in grown-up scents including mom jeans, latte, six-pack, and lawn scent.
Kohl’s carries a 4 ft. high legacy Pac Man video arcade game for $450.
Amazon has an entire category of “nostalgic toys” that includes the Magic 8 Ball, Lite Brite, Lincoln Logs, Slinky, Spirograph, Candy Land, Operation, Evel Knievel, and Etch a Sketch.
LEGO sells a mini version of Jerry Seinfeld’s bachelor pad from the 1990’s sitcom. [More about LEGO below]

Are these nostalgic products always profitable? Probably not. It’s doubtful that any approach the sales volume they once enjoyed; however, given that their design costs have long-since been covered, manufacturing processes have likely improved, little advertising is needed, and they can be sold online with relatively low overhead at premium prices, most of these items probably do make money — their proliferation is evidence.

So, it seems that selling nostalgic play to adults is often effective marketing, but is it ethical?

Two plausible moral concerns are that when adults play, they waste resources, namely time and money:

There’s an opportunity cost that comes with play – when we’re playing we’re typically not doing other things, like working, so we’re being unproductive.
Play can be expensive. Some people spend thousands and even tens of thousands of dollars a year on hobbies such as mountain climbing, boating, skydiving, and car collecting.

However, there also are very compelling arguments supporting that people of all ages need to play, or be “joyfully immersed in the moment.” While there are undoubtedly other benefits, here are five reasons why adults should play:

1. To learn: Videos like this one of lion cubs stalking and pouncing on each other show how play helps them begin to learn to hunt. Most of us also learned specific and generalizable skills through childhood play.

2. To maintain skills: As we grow older, our physical and cognitive abilities naturally decline. Play is one way to slow that descent, whether it’s by participating in a low-intensity sport or doing word puzzles.

3. To develop relationships: People build bonds with others in many different settings, e.g., work, school, church, and play. Friendships often form among individuals on sports teams, chess clubs, hiking groups, etc.

4. To reduce stress: Life at times has hardships and frustrations. Physical play helps us burn off anxious energy, while mental engagement in play often elicits laughter, positive thoughts, and good memories that help keep bad ones at bay.

5. To serve others: Each of the above reasons for play are pretty intuitive. This last one isn’t, at least it wasn’t for me until I connected with a colleague, RJ Thompson, who takes play to another level that one might call play with a purpose.

Thompson is the director of digital marketing in the Joseph M. Katz Graduate School of Business and College of Business Administration at the University of Pittsburgh. He’s also an award-winning graphic designer and the president of the Pittsburgh Chapter of the American Marketing Association. Those are impressive credentials, but the reason I reached out to him is because he’s a grown man who still loves Legos.

A resident of Bellevue, PA, Thompson recently completed construction of a 45 ft. Lego model of his town’s Lincoln Avenue using over 20,000 of the tiny bricks. What’s more, with only photos for reference and using as many as 30,000 bricks, he spent six months building a 30”L x 30”W x 45”H model of Bellevue’s Andrew Bayne Memorial Library that splits in half to reveal its fine inside detail. Each model cost thousands of dollars.

Why would an accomplished professional spend so much time and money playing with building blocks? Thompson credits LEGO for fanning his creative flame at a very young age and opening for him doors to design, teaching, and entrepreneurship. However, the impact of these epic Lego projects extends far beyond his personal enjoyment of the pastime.

First, the projects have afforded some priceless family time for Thompson and his daughter, who has inherited her father’s curiosity and creativity. Furthermore, with help he moved the massive models from his home to the Library where they served as the centerpiece of a fundraiser that drew hundreds of people and raised $1,500 for renovations to the Library’s children’s areas. Many kids were fascinated by the models and inspired to start their own Lego building projects.

As Thompson’s experience illustrates, play can be more than respite from work, mental relaxation, etc. Those personal benefits are very important in their own right; however, play can achieve a whole other level of significance when used like Thompson uses it, to serve others.

His examples left me wondering, though, with his play becoming so other-oriented, does he still find the same pleasure he once did, building with the miniature bricks? Thompson says he “definitely does,” adding:

“There are some models or kits I see that I absolutely have to have - so there is an anticipatory angle to it where I get excited just as much as my kid does about certain sets. When it first came out, I had to have Dr. Strange's 'Sanctum Sanctorum' model.”

As an artist and a marketer with a heart for play, Thompson shows how a pastime can become even more than a win-win: Purposeful play can have a triple or even quadruple bottom-line of positive impact. Those that sell nostalgic play help bring back fond childhood memories and remind us of the benefits of “Mindful Marketing.”

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Should Consumers Smile at Guerrilla Marketing?

10/9/2022

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by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Millions of baseball fans were recently watching televised games when they were unexpectedly hit by a pitch! An errant slider didn’t fly through their screens; rather, they were beaned by a very unconventional advertising curve. The promotional pitch for Smile didn’t leave any bruises; in fact, many even liked it, but is this kind of guerrilla marketing fair or foul? A veteran marketer and an up-and-coming rookie argue the call.

About a week ago, before a Consumer Behavior class, one of my students asked, “Dr. Hagenbuch, I have an idea for a Mindful Marketing topic — Did you see the promos for Smile?” I hadn’t experienced the creepy tactics live, but like many, I was caught in their viral wake.

Smile is a psychological horror movie featuring murders that begin and end with evil smirks. Like most production companies, Paramount Players and Temple Hill Entertainment made the obligatory film trailer and television spots. However, to capture even more interest ahead of the Halloween horror movie season, the film makers executed a truly menacing marketing strategy.

Among other events, Paramount targeted a few specific Major League Baseball games that were being broadcast to national audiences on September 23, such as Yankees vs. Red Sox and Mets vs. A’s, and in each game managed to seat an actor behind home plate, in perfect view of outfield television cameras. Some of the actors stood, while others remained seated; some wore neon “Smile” T-shirts; all “donned creepy, unflinching smiles for the duration of the game.

As television crews zoomed in on the unsettling smirks, social media quickly caught wind, and coverage snowballed into mainstream media, which is where I encountered Paramount’s bizarre promotional play. This wasn’t, though, my first exposure to guerrilla marketing.

Not long after I began my marketing career, I bought one of Jay Conrad Levinson’s books on Guerrilla Marketing. During my time in higher education, I’ve conducted research on shock advertising, which shares some ‘unhealthy’ overlap with guerrilla marketing. I’ve also written about these unusual tactics for Mindful Marketing a couple of other times:

For those new to guerrilla marketing, or anyone wanting a reminder, Investopedia offers a nice description of the strange strategies:

“Guerrilla marketing is a marketing tactic in which a company uses surprise and/or unconventional interactions in order to promote a product or service. [It’s] different than traditional marketing in that it often relies on personal interaction, has a smaller budget, and focuses on smaller groups of promoters that are responsible for getting the word out in a particular location rather than through widespread media campaigns.”

In college marketing classes, we don’t spend much time talking about guerrilla marketing, mainly because there are so many other foundational concepts students need to learn, and in many instances, guerrilla marketing isn’t a good fit for brands’ goals. It’s also not easy to teach something that hinges so much on deviant creativity and precise timing. Still, many marketers find it fascinating.

So, when Thomas Murray, the student in my Consumer class, mentioned Smile’s guerrilla marketing during MLB games, I wasn’t surprised for a few reasons. Not only is he a sharp emerging marketer, he’s an NCAA baseball player, and he knows something about going viral: A couple of years ago, he made a TikTok video of himself throwing a football over his house and catching it. Before long, ESPN’s Sportscenter and some other very popular media sites were sharing the clip.

During our brief before-class conversation, Murray told me he appreciated Smile’s unconventional approach. As someone who’s been skeptical of guerrilla marketing on whole, I was eager to hear more of his perspective, so I asked him to share his thoughts for this piece. He did, making several compelling arguments for why the unusual tactics worked for Smile:

Word of mouth marketing: Placing actors in public settings and having them wear bright shirts and creepily smile at baseball and football games and outside the Today Show, was a perfect recipe for attention. People took notice while casually watching those programs and within minutes the actors were all over social media.

Product placement: Part of the genius of the campaign was taking something right out of the movie and putting it into real life. If you watch the trailer, you’ll notice that is how eerily the people are smiling. Both in the movie and in real life it creeps people out, but it also lures them in as they have to look and wonder why they’re smiling like that.

Budget-friendly: The overall cost of this campaign was likely minimal as well. Tickets for high profile seats at top sporting events are expensive, but in a feature film’s marketing budget, they would barely make a dent. The return on investment for this campaign must have been massive given it relied on going viral and certainly delivered as the campaign grew organically throughout various social media platforms.

Great timing: The launch of the campaign meshed perfectly with the release of the movie. By placing the actors in public a week or so before the premiere, the producers were able to build exceptional interest, and excited movie-goers only had to wait until the following weekend to see it in theaters.

That’s some solid support for the campaign’s effectiveness; it’s hard to discredit any of Murray’s points. What I can do is raise what may be some helpful questions/concerns about guerrilla marketing’s morality:

Target market creep: Of course, horror movies are not everyone’s thing, so it could well be that such a broad-reaching campaign creeped out some of the wrong people, like children. The lack of audience selectivity with many guerrilla tactics is certainly something to consider.

However, briefly seeing a few creepy smiles probably didn’t traumatize any adults or kids. Most people seemed to think they were funny. The fact that Smile is a horror movie is another issue, which can be a topic of future analysis since the focus here is not on product but promotion.

Murdering the game: A very legitimate complaint to levy against guerrilla marketing is that it disrupts the natural settings in which it appears. For instance, wouldn’t someone sitting directly behind home plate, wearing a bright shirt and a creepy smile break a pitcher’s concentration?

I threw that question to one of Murray's teammates who pitches. Surprising to me, he said it wouldn’t matter—his focus is entirely on the catcher and batter. Although the Smile actors did draw some camera close-ups and comments from broadcasters, they didn’t seem to significantly detract from the television programs in which they appeared.

Encouraging copycats: Even if a given guerrilla marketing tactic is okay, what about all the other would-be marketers who see it and say, “That’s the kind of thing we need to do”? If every company implemented such strategies, our lives would be awash in a never-ending stream of commercialism.

Realistically, however, such advertising overflow is unlikely to occur. For the vast majority of business-to-business firms, guerrilla marketing is a mismatch for their target markets, and even for most business-to-consumer companies, the tactics aren’t the best promotional option. Moreover, it’s very challenging to create and execute effective guerrilla marketing, which when done wrong, can easily betray a brand – those are natural deterrents for firms that might consider using such strategies.

When I began to write this piece, I believed I had a good case against Smile’s strange promotion, but Murray’s analysis has made me reconsider my views. I still don’t think guerrilla marketing is good in all cases, but I believe the rookie was right to call this specific instance ‘fair’ and for both of us to consider it “Mindful Marketing.”

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Are There Rules When Everyone's an Endorser?

8/13/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

There was a time when only celebrities and aspiring actors were spokespeople. Now the friend you’re having lunch with tomorrow may, unbeknownst to you, have an endorsement deal. It’s nice that company sponsorship has been democratized, but with so many people pushing products, how can consumers survive the promotional onslaught?

The great expansion of spokespeople hit home for me a few months ago during a discussion about personal branding in our university's capstone marketing course. As we considered the notion that those present might be future endorsers, a student in the front row spoke up, “Do you know Rachel Delate? She’s already endorsing products.” A classmate quickly added, “Yeah, she has a deal with Body Armor.”

A year earlier, Rachel was in my intro to marketing class where she distinguished herself as a strong student. She’s also a very good lacrosse player, e.g., first team All-Conference, first team All-Region, third team All-American. After the NCAA’s recent relaxation of rules involving name, image, and likeness (NIL), that talent put her in a position to accept endorsement deals.

Besides Body Armor, Rachel also has enjoyed sponsorship experiences with TreadBands, Barstool Sports, and LiquidIV, which have provided her with a variety of branded gear. She says the experiences have been very worthwhile, as she summarizes in a sentence, “I’ve had the opportunity to connect with awesome brands and people and receive cool stuff!”

Knowing Rachel, I’m confident she’s a responsible influencer, but what about many others who have suddenly become spokespeople and might be looking to make quick money, not caring much about what they’re selling or to whom. How should they see their roles? But first, how did we get to this point of influencer inundation?

The rapid rise in number of endorsers has been the result of a perfect storm of at least three interwoven social trends and economic incentives.

First, over the last several years, new ecommerce platforms and tools have made it relatively easy and inexpensive to operate online shops, which has encouraged many people to start, run, and promote their own businesses.

Second, there’s been a steady increase in influencer marketing due mainly to the seismic shift from traditional media to social media. Advertisers have always needed to be where consumers are, which has recently meant firms moving money from the likes of NBC and the New York Times to an up-and-coming influencers’ TikTok and YouTube channels.

Third, crypto currencies and NFTs, two new categories of virtual products that were virtually unknown a few years ago, have offered an array of endorsement opportunities not only because they’re new but because many people still don’t know exactly what they are and, therefore, lean on endorsers to guide them.

It’s this third trend that recently grabbed product endorsement-related headlines, but not for good reasons:

Bloomberg described “the disastrous record of celebrity crypto endorsements,” such as that of actor Matt Damon who plugged cryptocurrency exchange Crypto.com, only to see Bitcoin’s price plummet by 60%.
BuzzFeed News reported that the watchdog group Truth in Advertising warned Jimmy Fallon, Gwyneth Paltrow, and fifteen other celebrities that they violated Federal Trade Commission guidelines by failing to disclose on social media their money-making connections to certain NFTs.

The proliferation of new and experienced influencers playing fast and loose with their referral power, makes me wonder: Have we entered the Wild West of product pitching where laws are lacking and consumers must take their protection into their own hands?

Hopefully, most influencers will have the conviction to self-regulate. For those who are so morally and professionally inclined, here are four best practices for product endorsement:

1. Know the product: An endorsement is basically a recommendation. People want recommendations because there’s something they don’t know well, and they’d like someone who’s more knowledgeable to guide them.

For that reason, every endorser should be very familiar with the product and/or company they’re recommending; otherwise, they’ll fail to offer value or worse, they might mislead the people who are trusting them for help.

2. Believe in the product: Although information is very important, head knowledge is only half the product-endorsement equation. Spokespeople should also believe in the merits of what they advocate.

Several years ago, a reporter asked basketball great LeBron James how he had improved his game and physique over the off-season. James unwittingly replied that he stopped eating at McDonalds, which was one of his main sponsors at the time. James’ slip underscores the fact that knowing about a product is not the same as believing in it. Endorsers shouldn’t recommend to others products they wouldn’t want for themselves.

3. Ensure the product is a good fit for the target market: Notwithstanding the previous point, there are instances in which endorsers don’t use the products they’re recommending because they’re not in the target market. In those cases, it is especially important that influencers understand the needs of those who do use the product.

For example, doctors often prescribe pharmaceuticals they’ve never tried. They can recommend them with confidence, however, because they’ve read the drug studies and believe in the companies that provide them; then, knowing their patients’ medical histories and symptoms, they can project with some certainty that their patients will benefit from them.

4. Disclose your relationship with the organization: From native advertising to salespeople acting as if they’re customers, one of the greatest deceits in business occurs when marketing promotion tries to pretend it’s not.

Advertising and personal selling are useful tools from which consumers can gain very helpful information; however, people need to know when the information source is objective (e.g., a fellow transit rider) versus compensated by a company (e.g., an online product reviewer who receives the items for free). It’s difficult for anyone to be unbiased about an organization that’s paying them, which isn’t necessarily a problem provided consumers know the relationship.

Developments in areas such as deepfake video, the metaverse, and NIL, give reason to be both excited and anxious about the future of marketing influence. Endorsers who see their roles as involving both individual opportunity and social responsibility will likely be promoters of “Mindful Marketing.”

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Do Subscriptions Make Sense?

7/30/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

“That’s the gift that keeps on giving the whole year”—such was Cousin Eddie’s inane attempt in Christmas Vacation to console a devastated Clark Griswold after he found out his firm gave him a Jelly of the Month Club membership instead of a generous cash bonus. Clark had good reason to resent receiving a product subscription, but how should consumers feel about more companies moving to subscription models?

If you’re like most people, you’ve noticed a steady rise in reoccurring payments. Decades ago, monthly bills were restricted to things like rent and utilities, but they’ve since expanded to include regular charges for cellphone plans, movie streaming, and online news. And, the list keeps getting longer, as even more organizations find opportunities to automatically tap their consumers’ wallets for things like clothing (e.g., Stitch Fix), meal kits (e.g., HelloFresh), and shaving tools (e.g., Harry’s).

These examples aren’t particularly surprising—each day people wear clothes, eat food, and shave their bodies, so it makes sense to automate the purchase process and save consumers time shopping for such staples. However, subscription services for some other products should make any of us wonder, ‘Why?’

For example, BMW has begun to offer “heated seat subscriptions” in certain vehicles for $18 a month. According to James Vincent, writing for The Verge, “BMW has slowly been putting features behind subscriptions since 2020.” The automaker’s other reoccurring charges include automatic high beams and adaptive cruise control.

There’s also sneaker maker Cloudneo, which offers a “100% recyclable running shoe that’s only available by subscription.” For $29.99 a month, customers receive “an endless supply of shoes.” When pairs are past their useful lives, customers request new ones while returning their old ones, which the company grinds down and melts into plastic pellets used in its new product manufacturing.

These last two examples and several of those mentioned earlier are innovative approaches that reimagine marketing’s 4 Ps. All share strategic similarities as they fall under the subscription umbrella, but there also are significant and sometimes unsettling differences that make me want to better understand: When is subscription pricing right for both companies and consumers?

To answer this question, I turned to someone who has navigated the challenging process of transitioning his company’s signature product from a one-time purchase to a monthly subscription. Jason Kichline is founder and chief technology officer of OnSong, namesake of one of the world’s most widely used music performance apps. It allows musicians to digitally store, sort, and customize their music, saving them time and enabling them to focus on what they do best.

An annual guest speaker in my capstone marketing course, Kichline has told us of his firm’s deliberations about transitioning the OnSong app from a one-time Apple App Store purchase to a monthly subscription. OnSong started to offer a feature-enhanced, subscription version of its product a couple of years ago. This past June, OnSong finalized the monumental move by eliminating the one-time purchase option.

For many companies, the decision to go to full sail on a subscription model is simply a matter of what nets the most money, i.e., will more revenue from reoccurring payments offset sales not realized from potential customers who want a one-time purchase?

Although OnSong certainly considered income projections, it’s analysis was much more circumspect and other-oriented, which is evident as Kichline explains three main reasons for the move:

1. Relationships: “We’ve always placed a high value on supporting our users. A complex and full-featured app like OnSong demands a level of support that goes beyond that of a one-time purchase. A subscription creates the opportunity for a more formal relationship with users and the need to continually provide them with value. Our goal is to make our customers incredibly happy with the level of service, support, and features we offer.”

2. Continuity: “Although OnSong has been successful for more than 10 years, many software firms don’t last as long—they go out of business, or they’re acquired. A developer can keep an app around for a long time for some side money or an owner’s salary, but a buyer typically wants ROI. For this reason, new owners turn many one-time-purchase apps into subscriptions and try to ‘leverage’ the existing user base.”

“Even though app customers often assume they’ll be forced to upgrade to a subscription, we didn’t feel it was fair, so we grandfathered existing users.” Still, because going out of business also leaves customers stranded, we believe that subscribing to OnSong is the best path forward for all. A subscription to OnSong is an investment in the company and its product’s future.”

3. Value-Added: “The defining measure for most consumers is what they receive compared to what they pay. Although a subscription costs more than a one-time purchase over time, it also provides greater benefits, including important updates and improvements in an ever-changing technological environment. A cancelable subscription also reduces financial risk for consumers by allowing for product trial, which is often not possible with one-time software purchases.”

“Looking to the future, OnSong wants to provide a web-based version of the app that will store music and resources in the cloud, as well as manage bands and teams. A subscription model supports this additional functionality and added value.”

Kichline acknowledges that the transition to a subscription model has not been without challenges, which include effective communication with consumers, who can be swayed by public perceptions in social media.

Still, the change has been a good one for OnSong and its customers. After experiencing one “tight month,” the company’s revenues quickly rebounded to previous levels with continuing growth. That success should also be taken as a sign of the strength of OnSong’s value proposition in the eyes of consumers—the benefits they receive from the app are well-worth its reoccurring cost.

For Kichline, key to the whole process has been “having the mind of the consumer.” His analysis above and this summary statement make me ask: Do the subscriptions for BMW’s heated seats and Coudneo’s recyclable running shoes show an understanding of “the mind of the consumer” and a desire to truly meet customers’ needs?

Cloudneo’s product subscription may represent such a market orientation for certain hardcore runners who cycle through sneakers at a rapid clip. They might wear out a pair of running shoes every few months and could easily spend $360 or more per year on performance footwear.

BMW’s subscription is harder to justify. In his Verge article mentioned above, Vince raises good points that call into question the automaker’s motives:

“BMW owners already have all the necessary components [for the heated seats], but BMW has simply placed a software block on their functionality that buyers then have to pay to remove. For some software features that might lead to ongoing expenses for the carmaker (like automated traffic camera alerts, for example), charging a subscription seems more reasonable. But that’s not an issue for heated seats.”

When BMW manufactures vehicles with heated seats, it likely passes on the added material and labor costs to consumers at the time of purchase. So, the automaker is essentially holding back a feature for which customers have already paid so it can charge twice for what is an increasingly common new car addition. Such a motive certainly wouldn’t represent a customer-centric attitude.

As BMW has shown, there are situations in which paying a reoccurring fee for a product makes little sense for consumers. However, when companies prioritize the three principles that Kichline has identified (relationships, continuity, and value-added), subscription pricing is “Mindful Marketing.”

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Is it a Sin to Advertise Religion?

AI Ethics Need Time

Turning Trash into Treasure

Ensuring Ethical Advertising

Financial Stardumb? Celebrities Endorsing Investments

When Organizations Give Thanks

Play with a Purpose

Should Consumers Smile at Guerrilla Marketing?

Are There Rules When Everyone's an Endorser?

Do Subscriptions Make Sense?

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