Fast Company features an important new book, "Can't buy me like" by By Bob Garfield and Doug Levy.   The book expands on the premise of this blog with current examples.  If you suspect being good is good business then this looks like a must read.

The real cost of saving money.

Internal Dell documents indicate the company shipped 11.8 million computers  between 2003-2005 with potentially faulty motherboards using capacitors that could leak and cause the machines to fail.  According to an article in The New York Times, it appears Dell attempted to feign ignorance and sweep the issue under the rug.

It just crawled out.  Documents from a three-year-old law suit have recently been unsealed shedding light on this brand equity train wreck.

Unlike competitors who stopped shipping equipment with the faulty capacitors, Dell apparently kept pushing them out the door - mainly to large corporate customers.

It looks like Dell didn't exactly take the high road when the magnitude of the problem became known.  It's never good when employees send emails saying things like,  “We need to avoid all language indicating the boards were bad or had ‘issues’ per our discussion this morning.”  In other documents about how to handle questions around the faulty OptiPlex systems, Dell salespeople were told, “Don’t bring this to customer’s attention proactively” and “Emphasize uncertainty.”

Dell has already spent millions extending warranties and defending this suit.  Should Dell lose, they could be on the hook for a large penalty.  That figure will certainly be dwarfed by the long-term damage done to the Dell brand by this news.  The corporate customers who originally built the Dell brand will now have to think twice before specing the company's hardware.

I'm guessing the Dell manager who made the decision to try to keep a lid on this in the name of short-term cost containment had no idea he or she was making one of the biggest marketing decisions in the history of the company.

Time traveling

I want to share an amusing peek at the future of traditional advertising agencies.

The Last Advertising Agency On Earth from FITC on Vimeo.

The joke has been told before but this rendition nails a real truth - fewer and fewer consumers are influenced by blunt force attempts at persuasion. If not avoided or ignored altogether, traditional advertising rarely delivers the influence conveyed when one's peers weigh-in on the merits of a product or company via social media or in person.

Many agencies ironically miss the point and assume they simply need to migrate to newer, digital communication channels. The transformation underway is not analogous to adding a department as agencies did during the mid-century transition from radio to TV. To be sure, "ads" will still be around to do things like rally enthusiasts and announce new products. But agencies will be distinguished by the ideas they bring that materially improve the customer experience or enable brand evangelists to share their convictions.

We're coming full-circle back to an era where people rely on word-of-mouth and reputation to make purchase decisions. Technology will make it easier and better than ever but I think marketing in 2020 may work a lot more like marketing in 1820 than the way it does today. That's good for (good) brands and good for consumers. I predict a buyer's market for slightly used Foosball tables.

Toyota: doomed by its own culture?

I've resisted posting on the Toyota mess up to this point feeling that mainstream media may be piling-on a bit. The debacle is not going away. It seems a new embarrassment for the company surfaces roughly once a week.

A recent article in Automotive News by James Treece sheds new light on the culture inside Toyota and how that may be the root cause of the company's troubles. Treece spent 22 years living and reporting on the auto industry in Japan and brings firsthand knowledge of the situation.

Treece's article, while a bit inside baseball, paints a clear picture. Toyota's insular, secretive culture drove their attempts to stifle early safety concerns rather than openly vet and address them. Initiatives to suppress the damage by playing it down with the media, strong-arming regulators and what appear to be partial technical fixes have caused the biggest brand image backfire in modern marketing history.

Toyota rode one attribute, "quality" to the top of the automotive category. That's gone now. We won't know for years if they will be able to reclaim it. I'm not sure their snazzy styling or impressive handling will carry the day in the absence of the quality gene. The irony of Toyota defaulting on it's core equity is not lost on owners of Toyota vehicles.

What's missing at Toyota is the ability to be open and transparent internally and with the public. A transparent corporate culture is not a "nice to have" or a fashionable marketing trend. It's an essential means for earning the public trust. The modern marketplace rewards brands that behave with integrity. It punishes those that demonstrate they are not trustworthy. As a Toyota owner, I feel the sting every time I turn the key.

Walkin' the talk

Fast Company today details 11 Ways That Walmart Is Changing Retail -- for Good with respect to sustainable business practices. These are the same 11 ways Walmart is differentiating itself from most other big box retailers by demonstrating extraordinary social integrity. Not surprisingly, these are also the 11 ways they will probably save significant money over the long run.

Perhaps a better title for this article might be "11 ways Walmart won't have to compete on price." It's a fun slide show worth a few minutes of your time. Last post on Walmart for a while. I promise.