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This article by Kathleen McGinn Spring was prepared for the October 2, 2002 edition of U.S. 1 Newspaper. All rights reserved.
Be Courageous: Pick One Business Niche
Roman playwright Lucius Annaeus Seneca wrote: "Our
plans miscarry because they have no aim. When a man does not know
what harbor he is making for, no wind is the right wind." Or as
New Mexico ad man Steve McKee says, "It’s all about focus."
One of the biggest mistakes companies make, says McKee, is spreading
themselves too thin. He offers Amazon as an example. "Stop 100
people on the street," he says. "Ask them what they think
of when they hear `Amazon.’ Ninety-nine will say books." That
branding can stretch a little. There is a natural cross-over to DVDs,
music, and maybe even audio electronics. But stretch into boots and
snow shovels, as Amazon did, and consumers become confused.
Amazon is working on its over-reach issues, says McKee, by teaming
its behind-the-scenes E-commerce technology — its real killer
ap — with established brands; selling toys, for example, in tandem
with Toys R Us.
McKee, president of the Albuquerque, New Mexico, marketing company
McKee Wallwork Henderson, is as focused as he urges his clients to
be. "Sylvester Stallone is an action hero," he says. "He
has to accept it, and not complain. I’m an ad guy." He not only
accepts the designation, but embraces it with zest. A graduate of
the University of New Mexico (Class of 1985), he began his career
in advertising at age 22, and worked for N W Ayer, Phillips Ramsey,
and Della Femina before starting his own shop, in 1997. On Tuesday,
October 8, at 11:30 a.m. he speaks on "Bulletproof Marketing"
at a meeting of NJ CAMA at the Doral Forrestal. Call 609-799-4900.
McKee’s shop is as focused as he is. It serves growth companies. If
other clients come knocking, they will not be turned away, but they
will receive services "through the back door," McKee says.
The importance of achieving a tight focus first jumped to the forefront
of McKee’s priorities when he attended a launch conference for Microsoft
95. It was announced, he says, that the company had retained 12 "best
of breed" marketing companies to get the product off to a flying
start. Some of the companies were small, he recalls thinking, but
all had managed to establish an identity that made them stand out.
"It was a formative moment," he says. "I decided I wanted
to be `best of breed.’"
When McKee started his own shop, he made identifying a focus his top
priority. Many agencies specialize in an industry group, maybe pharmaceuticals
or banks. Others concentrate on an age group, often young children
or teen-agers. McKee decided neither of those approaches would work
for him. For one thing, lots of other agencies were there already.
For another, he thought it would be boring to serve so narrow a clientele,
and the tedium factor would make it hard to recruit the best staff.
He hit upon the idea of cultivating a base of growth companies. These
companies, with sales growth of 40, 50, even 100 percent a year, appeal
to him because, "they’re aggressive, they’re growing." Furthermore,
they tend to be small enough so that the CEO still takes a hands-on
role in marketing. No one was homing in on this niche, despite the
fact that companies in it face unique issues.
"They can’t make a mistake," McKee says of young, fast-growing
companies. They have to build an identity and get a message across
the first time. Marketing for this group must be "bulletproof."
The strategy is working. In a down year of historic proportions for
the ad industry as a whole, McKee says his shop is on track to a 40
percent increase in revenue. He credits a tight focus for his success,
and makes these recommendations:
lines — and more and more. Almost always, says McKee, doing so
is a mistake, quite often a fatal mistake. He points to Jaguar. "You
can write them off, they’re gone," he says of the car manufacturer.
Being folded into Ford, in his opinion, is killing what was once a
strong luxury brand. "The new Jaguars share a platform with a
Lincoln," he comments. "If I wanted a Lincoln, I’d buy a Lincoln."
He looks down on Mercedes’ downward aspirations too. "They’re
making a huge mistake, selling a $28,000 C Class," he says. "If
you aspire all your life to drive a Mercedes, spend $80,000, and pull
up beside a 22-year-old kid (in a Mercedes), it’s a brand breaking
Hotel companies, in his opinion, tend to get it right. McKee says
Marriott is smart to use a different name for hotels in each of its
price categories. Ditto with Starwood Lodging and Hilton.
businesses and solo practices too. "I see directories of ad agencies,"
says McKee. "Under `specialty,’ some companies list eight things."
Better, he says — far far better — to develop just one specialty,
or, at most, a handful of closely-related specialties. But this is
not easy, he acknowledges.
"Everyone thinks `what if Nike calls?’" he jokes. But the
chances are slim that a dream job will go elsewhere because "athletic
footwear" isn’t listed as a specialty. McKee urges professionals
to bite the bullet and make a choice of specialty.
word. Doing so will be easier for a specialist than for a generalist.
For his business, McKee need only concern himself with growth companies.
"There are mailing lists," he says. He can use a list of names
of fast growing companies with annual sales between $20 and $100 million,
his target group. Direct marketing works for him. Someone in a different
specialty, say machine tools, might do well with trade magazines.
In any case, narrowing the audience makes reaching it easier.
"It takes years," says McKee. Don’t set expectations too high,
expecting to be on everyone’s lips in six months. Be realistic, and
all along the path to business success. It is hard to avoid stooping
to pick one up. But better to just keep walking.
In an almost unbelievable example of the peril of distractions, McKee
talks about Gerber’s foray outside of its core business. The company
made famous the jingle: Babies are our business, our only business.
But once upon a time, McKee swears, the company allowed itself to
be persuaded that Gerber stood not for babies but, in his words, "for
nutritious mashed-up food in jars."
Gerber’s attempt to peddle pureed vegetables to seniors was a dismal
failure, a prime example of a ship getting badly lost on its way into
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