♦ INTERACTIVE CASE: Watch the author interview and submit your commentary on the case. Gordon McMaster, the CEO of Hunsk Engines, introduced his new head of marketing to the company’s top managers over bagels and coffee. “I want to make something clear,” Gordon told the group. “I know we’ve gone through a number of marketing VPs and campaigns. But Marty is the guy we’ve been waiting for. I know what he stands for, what he wants to push the company to do, and he has my unqualified support.” Gordon knew Marty Echt had the chops for the position. The new hire had spent his early post-MBA years at a large packaged-goods company learning the consumer-marketing ropes, but he’d earned his reputation as a focused miracle worker elsewhere: He’d transformed a bottled-water manufacturer into an innovator in the energy-drinks space and then built a distributor of specialty sports equipment into a cult brand. On his first day at Hunsk, Marty was dressed to impress. He wore his best work suit, his cream dress shirt, and a tie with a soft brown and green pattern that pulled it all together. But Paula Marchesi, director of promotions, was most interested in the unpolished, black, heavy-soled boots under Marty’s trouser cuffs. “Trouble,” she thought. Marty thanked his boss and then took the floor. Hunsk Engines had, he explained to his new colleagues, systematically devalued its considerable pedigree. There had been a time when Hunsk was considered a rival to Harley-Davidson. Harley made the wild brute machines with their characteristic growl, but Hunsk appealed to those who wanted a bike that ticked like a clock even as it moved like a rocket. The paradigmatic Hunsk rider wasn’t someone who was just trying to look like an outlaw. He (men dominated the company’s demographic) was a real rebel. Fiercely independent. Confident and edgy. More a Dennis Hopper than a James Dean. The company had made the classic mistake of trying to expand its reach at the expense of its existing market. Twenty years ago, Hunsk had tried to move into light motorcycles, touting the quietness of its engines with a tagline that asked, “Was it the wind or a Hunsk?”—as if people rode Hunsks because they didn’t want to be noticed. Then there was the attempt to appeal to the youth market. Marty liked the way the tagline “Before you have to get a car, ride your Hunsk” repositioned cars as a drag, but Hunsk bikes were no adolescent playthings. They were serious machines. Currently, the company was using an eco-friendly marketing pitch: “More freedom per gallon.” Marty had known all this before he arrived. Keeping up with the motorcycle industry was a passion for him. He bet he was the only one in that room—including, he suspected, the CEO—who could rattle off the model and year Hunsk last used real leather for seats. The next day, Marty gathered the entire marketing group. “What happened to the Italian suit?” Paula asked. Marty laughed. He was now in a tired sports coat, black slacks, and his motorcycle boots. “I didn’t want to frighten anyone right away with the real me,” he said with a smile. After the others had introduced themselves, Marty began: “Obviously there are going to be changes, but this is something we can succeed at only if we work together.” The direction Marty wanted to go was simple and seemed blindingly obvious to him. “This is a real company,” he said. “It’s not some internet start-up that switches from making video games one day to saving whales the next. We’re not making cheap knockoffs of designer dresses. Hunsk is the real deal. We make the best damn motorcycles in the world. We don’t have ‘customers’—we have believers. Well, we used to, before we got away from our roots.” “So,” said Paula, “we’re going to do a back-to-our-roots marketing campaign.” Marty noted the touch of cynicism in her voice. “No. It’s not just a marketing campaign. We’re really going back to our roots. Hunsk has always been about authenticity. We are going to become the authentic company we once were. If it were just more marketing bull, our customers—our believers—would sense it.” “We’re going to eat our own dog food?” suggested Carla Meyer, head of marketing communications. Marty crossed his arms and smiled. “We’re going to be our dog food.” Bugs in Your Teeth Marty stood among the hundreds of motorcycles being showcased at the Cycle Thunder World Expo. He hadn’t ridden one since a bad spill his senior year in college. But as he surveyed the bikes around him, he remembered how much he’d loved forcing his way through the wind, challenging the laws of motion. After he made his way through the display area, he stopped at the Hunsk booth and was appalled by what he saw. Granted, it had been too early to roll out the new marketing campaign. Nevertheless, he cringed at Hunsk’s efforts. The booth was pitifully conventional—some bikes on display, racks full of same-old-same-old brochures, and a contest to win luggage containers for the bike many attendees probably didn’t even own. Marty made a mental note that at the next exhibit they ought to show bikes that were dirty and maybe a little dinged. The pristine, glistening machines out on the floor were too far removed from customers’ experience. Shortly before he had to leave for his plane, he grabbed Paula and pulled her far back into the Hunsk booth. “It’s not your fault,” he told her, “but I have to say I’m pretty disappointed. The marketing materials are all fine”—intentionally weak praise—“and obviously we’re not ready for the new launch, but all that’s fixable.” Paula clenched her teeth, waiting for what was next. “I happened to spend a fair bit of time with Connie March, watching her interact with prospects,” Marty said. “She’s a very nice woman, and she seems to know the product line. But do you think she’s ever been on a motorcycle?” “Marty, customers love her.” “Yes, I’m sure she’s a great employee and a great person, and there’s definitely a spot at Hunsk Engines for her. But we’ve got to get her off the front lines. And not just her. We have a team of top-notch demo-ers and salespeople, but when you walk into our booth, you should feel as if you’ve just walked into a garage where people have grease—our grease—under their fingernails. Nobody’s going to believe that about Connie or the rest of the crew. This booth just yells ‘Poseur!’” When you walk into our booth, you should feel as if you’ve just walked into a garage where people have grease—our grease—under their fingernails. Paula sighed. Connie would be devastated to hear the feedback. A few days later, Marty addressed the marketing team at a commercial racetrack, where he’d brought the group for a field trip. It struck him how very little anyone there looked like the typical Hunsk customer. “How many of you had ever been on a motorcycle before today?” he asked. That was the real point of the afternoon: Every member of Marty’s team had been taken for a spin by someone from the track’s service crew. About half the hands went up. “Keep ’em up. Now, how many of you had ever been on a Hunsk?” About a third of the hands went down. “Not too bad. And how many of you have ever owned a motorcycle?” Only three hands stayed in the air. “So, what did you think of your Hunsk moment?” Marty asked. A couple of people said, “Cool” or “Fun.” He continued, “More specifically, what did being on the back of the Hunsk 2000 JetEdge make you think of? What did it remind you of?” The group could now tell that it was time for some Marketing 101. Faces got serious. “Like riding a bull,” said a woman from design. “This was a great idea,” a man from the exhibition staff added. “I think I really get it now.” “I was terrified,” said Zack Inchon from investor relations. “I felt like I was going to fall off the entire time.” Zack had tried to beg off, but Marty had insisted: “How can we be an authentic company if we have marketing people who refuse to even be a passenger on one of our bikes?” “I felt manly,” said Paula. Marty ignored the sarcasm, but he did think he saw a few smirks. Back at the office later that week, Marty was stopped in the hallway by Pete Ricard, who headed the PR group. “I’m a little confused by your notes on my budget proposal,” Pete said. “I know a lot of people consider cause marketing to be a frill, and its results can be hard to measure—” “I have no problem with cause marketing,” Marty explained as he steered Pete toward the snack machine. “It’s just this cause.” “You’re against motorcycle safety?” Marty laughed. “I’m totally in favor of it. And motherhood, too. Hunsk makes the safest bikes on the road. But your cause isn’t exactly safety. It’s advocacy for helmet laws.” “Helmets save lives.” “Sure they do, but the Hunsk rider doesn’t want to have to wear a helmet. He doesn’t want to be reminded to stay alive—he wants to feel alive. And the brand is about freedom. Not just the freedom of the open road, but the freedom to make your own choices. So aligning ourselves with eminently sensible helmets and laws that are imposed by society makes zero sense if we’re going to stay true to the Hunsk experience.” “But aren’t we being irresponsible then?” Pete asked. “The owner’s manual tells people to wear their helmets—but there’s a difference between marketing and manuals. I do support the idea of cause marketing, though,” Marty continued, putting his quarters into the machine and selecting the trail mix. “I want us to lead the charge against those god-awful motorcycles without mufflers. That would get us goodwill but also remind customers that our machines don’t have to make a lot of noise to be powerful. That’s an authentic cause for Hunsk.” Right Skills, Wrong DNA At first, Marty couldn’t figure out what was so odd about the e-mail he’d received: Dear Marty, It’s come to the attention of the Digital Marketing Group that our recent experiment with user-generated content tagging on the Hunsk site is having an unfortunate result. The tag cloud we’ve created, at your suggestion, is showing that the two tags customers apply most frequently are “problem” and “rattle.” We would therefore like to suggest that either: (1) those words be removed from the tag cloud or (2) we reduce them in size so that the tag cloud doesn’t make it look as if Hunsk Engines’ customers are dissatisfied, especially since—as you know—our customer satisfaction rates are among the very best in the industry. Thank you for your attention. Sincerely, Matthew Wyck Ah. Matt wrote e-mails that sounded like memos. The tag cloud actually gave Marty a little thrill. It was as close to customers as he could get on a daily basis. It showed what they thought were the most important issues. He banged out a reply: Matt, Don’t sweat it. Our customers love us, and they’ll love us more for being honest. Leave the tag cloud as is. It’s part of how we’re building an authentic company. And please send the link to those two tags to Quality Assurance ASAP. Apparently there’s a problem with a rattle in our bikes. Keep up the excellent digital work. –Marty As he sent the message, Fiona Napoli, a young and promising writer in the communications group, entered his office resolutely. “What can I do you for?” he asked, hoisting his boot-clad feet onto his desk. “I was disappointed not to make it into the LTP.” The Leadership Training Program identified up-and-comers within the organization. “I can understand that,” Marty said, “but you shouldn’t take it as a criticism.” “How can I not? Getting in is a sign that management has confidence in you, sees a future for you with the company.” She sat straight up. “And we do. Definitely. You do great work for us. But look, you came to us right out of school—if I remember correctly, Columbia Journalism. Doesn’t get better than that.” “And that’s a problem because…?” “It’s not a problem. But we’re building a specific type of management team now. You write well, you’re a hard worker, you’re helpful to your coworkers—” “So, what’s missing?” “We need a management team that’s got the same DNA as our customers.” “Not sure I follow,” Fiona said. “Because I’m not a white man of a certain age and mind-set, you won’t consider me for leadership development?” “Because I’m not a white man of a certain age and mind-set, you won’t consider me for leadership development?” “It has nothing to do with gender or age—but mind-set, yes. We are looking for people who truly, deeply understand what this company stands for and what it means to our customers.” “How do you know I don’t?” Fiona challenged. “Based on what I’ve seen, you’d be just as happy writing about food processors or politics or health. You’re smart. You’re interested in a lot of things. Me, I’m interested in just one thing right now: Hunsk motorcycles. I think about them in the shower. I think about them when I’m playing with my son. I wake up in the middle of the night with ideas.” Fiona paused. He had pegged her correctly, but she thought it was a stupid reason to limit her growth potential. She did her work exceptionally and was adaptable enough to tailor it to the culture, even if she was not of that culture. As she turned on her heel, Marty knew she’d be going back to her cubicle to search her laptop for her old résumé. Getting Too Real? Marty had been given free rein, more or less, his first few months. But he knew that the CEO thought highly of Fiona, and he started to wonder how committed Gordon was to total authenticity. Gordon wondered that himself as he waited for his turn at the golf tee. He liked Marty personally and loved his engagement with the product. And Marty’s marketing campaign was beginning to show results. The new tagline, the new ads, the new look—everything reminded Gordon of his early years at Hunsk. He could practically smell the sweat and gasoline that used to waft up from the basement engineering shops and permeate the entire office. Gordon had ridden one of the original Hunsk PowerRevs back when he had more time for leisure rides. But he couldn’t remember the last time he’d actually been on a Hunsk just for his own sheer pleasure. Long time ago. Too long. Marty’s campaign brought all that back to him, and it was apparently having the same effect on the market. Even beyond the numbers, Gordon could sense it. Still, there were complaints. A lot of them. Some very good people in the marketing department felt out of place. Employees throughout the company who had done terrific work for years were feeling dismissed, censored, marginalized. There had even been complaints about Marty’s use of salty language in the office, as if he were out with some biker buddies. And Marty’s rejection of helmet safety as a Hunsk-worthy cause seemed off the mark. It might even hurt the brand. Overall, though, Marty’s marketing campaign portraying Hunsk as an authentic company, one that’s held on to its values, was definitely promising. The fundamental question, Gordon realized, was more about the value of being an authentic company than about the value of the campaign. The fundamental question was more about the value of being an authentic company than about the value of the campaign. Maybe he should tell Marty just to stick to marketing and not to worry about the company’s authenticity. Yet, could a marketing campaign succeed in the long run if it portrayed the company as filled with bike enthusiasts when in fact the employees would just as soon commute in minivans? Hunsk was the “real deal,” as Marty liked to put it, and it seemed foolish not to turn that into a business advantage—but was the price too high? Was authenticity even possible for a corporation? Gordon stepped up to the tee and eyed the ball. Should Gordon continue to back Marty’s no-holds-barred authenticity approach? Bruce Weindruch is the founder and CEO of the History Factory, a Chantilly, Virginia–based heritage management firm that, among other services, helps companies capitalize on their past in their marketing campaigns. He can be reached at bweindruch@historyfactory.com. Marty Echt is a really smart, well-intentioned marketing executive who’s mistaking his perception of Hunsk for inherent attributes that make the brand “authentic.” I typically recommend that marketers like Marty invite a group of company engineers down to the archives to spend a couple of hours exploring old engineering drawings, ads, and product photographs. Here they can identify exactly how things have changed. More often than not, they are remembering the past in a golden haze. It’s not uncommon for purportedly authentic marketing campaigns to be based on a history that never really existed. Connections with the past provide reference points for meaningful authenticity-based marketing campaigns. Saab, for instance, was an aircraft manufacturer at its founding. Aerodynamic lines, efficiency, and functionality serve as the automobile company’s links between yesterday and today—and they resonate with customers and employees alike. Just as important, companies can use connections with their past as part of a repenting and reforming process when they’ve strayed from their original vision. As a key element of its successful turnaround, my client Brooks Brothers instructs its salespeople first to thank customers who acknowledge that they are giving the retailer a second chance and then to concede that the company compromised its standards of quality in the 1970s and the 1980s while trying to be too many things to too many people. Marketing tactics designed to project authenticity do not an authentic company make. As a historian, I’ll be the first to admit that such campaigns worked surprisingly well in the era of one-way communication (print, radio, and television). However, “candid” customer feedback posted on a company-authorized website looks fake compared with blog postings that praise or slam a company and its products. In today’s wired world, the most authentic marketing tactic is to actually do something about customer feedback. That said, authentic companies don’t chase down every single idea or request lobbed their way; they know who they are and know their mission well enough to figure out which opportunities to pursue. For instance, they wouldn’t spend much time debating which causes its customers are interested in before deciding where to put their corporate social responsibility dollars. Customers should feel empowered to connect with causes whether the company endorses them or not. All the hunches or marketing data in the world may never have connected BMW with Susan G. Komen for the Cure. But since 1997, BMW owners have raised tens of millions of dollars annually for breast cancer research. Komen’s hyper-grassroots approach to fund-raising and BMW’s dealer profile and owner demographics aligned to create a powerfully genuine connection. A company needs to know where it’s going before it can claim the authenticity of where it came from. Its success in this regard hinges on involving customers and employees alike in a vision for the company’s future. The folks at Harley-Davidson know that they determine what’s original and authentic in motorcycles. Their competitors can copy where Harley has been, but they have no idea where Harley is going. It’s the future that motivates and unifies the workforce at Harley-Davidson, not the fact that employees drive Harleys rather than minivans or hybrids. Unless Hunsk swaps its notion of authenticity for a better understanding of its real past, the only place you’ll be able to find its machines will be on eBay. The annals of business history are filled with companies like Pan Am, Polaroid, and RCA, whose “authenticity” didn’t save them from the bruising realities of the rough-and-tumble global marketplace. I’d be willing to bet that unless the folks at Hunsk swap their notion of authenticity for a closer look at the company’s past to understand what customers and employees really believed in, the only place you’ll be able to find a Hunsk machine in a few years will be on eBay. Gillian Arnold (gillian.arnold@galuxuryconsulting.com) is a Rome-based strategic consultant to luxury fashion and fine jewelry brands. She was previously the CEO of Karl Lagerfeld, based in New York. She also founded and managed a diamond jewelry business carrying her name as the brand, with distribution in 117 fine jewelry stores in the United States. Hunsk’s problem is not a swashbuckling marketing VP with tough new ideas but rather the CEO’s lack of leadership. Gordon McMaster, when he stopped biking, lost sight of the characteristics that made Hunsk a successful competitor of Harley-Davidson—and this, in time, affected his choice and management of staff. Fundamentally, Marty is right. I believe that people in key marketing posts should be passionate about their products and know them inside and out. If you haven’t been on a Hunsk, even as a passenger, how do you know how it feels? In luxury fashion, all key executives get dress allowances from their companies’ new collections as part of their remuneration package. There is the implicit understanding that no one should even consider wearing another designer. Support staff get to purchase clothes at giveaway prices in sample sales. It’s the only way they can really live the brand. Every company should be driven by the CEO’s vision. In this case the real question is, Will Gordon do what it takes to change Hunsk’s internal culture to match the company’s external image? Is he up to the challenge? While verbally backing Marty’s vision of authenticity, Gordon doesn’t seem wholly committed to Hunsk’s transformation. His role should be promoting the new vision within Hunsk and, where necessary, reinforcing it. He doesn’t have sufficient insight into the people who work for him, and he needs to address the significant disconnect between his staff and the brand. Gordon doesn’t have sufficient insight into the people who work for him, and he needs to address the significant disconnect between his staff and the brand. I was the CEO of a luxury fashion brand. When I joined the company as an executive VP, my mandate was to understand why this famous designer had lost millions of dollars and what could be done to turn the situation around. It was fairly easy to work out. Instead of hiring a CEO who had come from a superbrand, like Chanel, the parent company had hired one from a moderate sportswear house—a different culture altogether. Because of his background, he led the company in the wrong direction. What should have been luxurious designer clothing manufactured in Italy and France was in reality moderate fashion manufactured in Hong Kong and China. This CEO didn’t understand how to romance the Saks Fifth Avenues and Neiman Marcuses of this world. When I came on board, I worked very closely with the designer, explaining the characteristics of the target luxury consumer—and he designed accordingly, because he shared my vision. I moved production back to Italy and France, back to the roots of luxury fashion. After changing the internal culture and the way we marketed the now luxurious designer brand (by sending clearer signals), we soon became very successful. During the transition, I was offered the CEO job. I had simply repositioned the brand to reflect authentic luxury in every way. Nowadays, as a consultant to luxury brands, I often find myself telling clients that the CEO needs to engender a shared vision of corporate strategy and values, map clear objectives, and introduce new ways to measure success. The chief executive must also know how to recognize and manage talent and be willing to reassess employees under the new conditions, even if she had hired them in the first place. That may include, ultimately, letting go of those people who no longer fit in with the vision. Corporate culture needs to reflect the authenticity of the branding message it sends out. James H. Gilmore and B. Joseph Pine II are the cofounders of Strategic Horizons in Aurora, Ohio, and the coauthors of Authenticity: What Consumers Really Want (Harvard Business School Press, 2007). They can be reached at jimgilmore@aol.com and bjp2@aol.com, respectively. Marty provides a perfect illustration of why so many heads of marketing last such a short time. (Spencer Stuart famously publicized the tenuous tenure of CMOs: Their average time on the job in the “top 100 branded companies” is less than 24 months; more than 50% of those still in place have held their positions for less than one year.) Marty arrives with all the answers, repackages old marketing methods as some newfangled approach, imposes his personal view of what customers want, and dismisses any malcontents who fail to embrace the new vision. Dirty bikes at trade shows won’t successfully frame a new “authenticity” campaign that sustains demand for Hunsk motorcycles. While introducing new taglines, new ads, and a new look may often be necessary actions, they may represent a marketing facade rather than real thinking about how best to generate the increased sales needed to build a brand. Marty seems to want to stay true to the Hunsk experience. What Hunsk experience? No amount of talk about being a real company can substitute for offering actual experiences that personally engage customers. Marty’s efforts simply perpetuate the phony marketing that has led to Hunsk’s predicament in the first place; the only difference is that the hollow promises are now couched in the language of authenticity. Marty’s efforts simply perpetuate the phony marketing that has led to Hunsk’s predicament. The only difference is that the hollow promises are couched in the language of authenticity. We sincerely doubt that the new campaign will continue to show results for very long. The case writer could have just as easily suggested that despite all Marty’s efforts, sales were still languishing; that would have better fit the facts for most has-been brands. Rather than trying to be a “real company” or forming a management team whose personal interests match the brand, Hunsk needs to manage customers’ perceptions. People today purchase on the basis of whether a product conforms to their self-image; that alone determines the authenticity of the brand. First, the company must fix its quality problems in manufacturing so it can move toward offering mass-customized bikes. The motorcycle business awaits some brand to provide mass customization, as Mini Cooper and Scion have in the automobile industry. Motorcycle customization primarily occurs in the aftermarket, so giving people the ability to personally design their own bikes from the outset would position Hunsk as the superior provider of self-expression. Second, management needs to abandon the self-fulfilling view of the paradigmatic Hunsk rider as a “he.” The greatest opportunity to grow sales resides in getting more women to ride. In this regard, the nonriding Fiona Napoli may be more qualified than her enthusiast boss. Let her and other up-and-comers launch a campaign for real safety aimed at attracting more female riders. Juxtapose Hunsk’s male-dominated past with its female-driven future. The real deal is often defined by unlikely polarities—like Bob Dylan hawking Victoria’s Secret lingerie. Finally, Hunsk should replace its fake marketing with real placemaking: Start by reinventing the experiences customers have at dealerships. Draw inspiration from the success of Viking Range in transforming stores into cooking schools. Invest in “pop-up” events that attract new customers, as Red Bull leverages Flugtag competitions, downhill ice skating, and soapbox derbies. Such actions may not restore Hunsk Engines as the authentic company Marty thinks it once was, but they will help render its motorcycles authentic to an ever-expanding customer base. Glenn Brackett (booboys@sweetgrassrods.com) is a co-owner of Sweetgrass Rods, a maker of bamboo fly-fishing rods in Twin Bridges, Montana. The buying public craves authenticity, but this fact seems to elude many CEOs. I believe that the perfect company is one where everyone is happy, from owners to employees. This business model eliminates greed and emphasizes sharing—which means acknowledging employees as the most essential aspect of the organization. A company that adopts this strategy will attract folks with a passion for what it produces or sells. Otherwise, it may hire a bunch of competent people who lack the heart and soul that can really make a company click. That seems to be what Marty is facing at Hunsk. Marty is not the problem—the employees who lack real passion for their product are. And the CEO has allowed the problem to fester. He’s not even passionate himself anymore. Whether Marty can be successful as one man with a mission is hard to tell. It remains to be seen whether he can train personnel to be passionate or superimpose authenticity on a company that no longer has it in its DNA. The secret is not to lose it to begin with. Marty is not the problem—the people who lack real passion are. If employees bring blood, sweat, heart, and soul to the product, it will manifest that spirit. R.L. Winston Rod Company, the fly-fishing rod maker that two partners and I used to own, became a virtual clinic on how to kill the spirit of a company. We sold Winston in 1991, agreeing to stay on after the sale. But we quickly realized that passion and common ambitions do not always go hand in hand. In our opinion, Winston veered away from what had made it special. For example, there was talk of having an old craftsman working in a room out front just for image, while drones made “handcrafted” items on an assembly line in a back room—pure smoke and mirrors. It presumed a total ignorance of the customers. In the end, three coworkers and I decided to leave Winston, which we had lovingly helped develop into a business with a world-class reputation, because we thought it lacked the soul of its customers. Then my current partners and I set up Sweetgrass Rods, a much smaller company. For us, the authenticity of the product—which was critical to our mission—was more important than personal profit. I had grown up watching the people who originally made Winston rods. In those days, Winston was an open-door shop. Sometimes you wouldn’t even find the craftsmen there at all, because they’d just gone fishing. We have an open-door policy now at Sweetgrass, and we look for a genuine passion for the craft and the sport in all our employees. That’s what connects us to the product and to our customers. We spend a lot of time writing to and talking with our customers—we like to think of them as family. Their happiness, their enjoyment from our rods—those are the kinds of readouts we focus on. It is possible to be authentic as a company, but it’s so much more than a marketing strategy. If I were running Hunsk, I would embrace Marty’s insights like gold. Marty seems to be one of the few people who understand Hunsk motorcycles. Once authenticity is eradicated and years go by without it, the public and employees alike don’t know what they are missing. It’s a shame that Gordon didn’t have the passion to prevent that problem at Hunsk in the first place. If employees bring blood, sweat, heart, and soul to the product, it will manifest that spirit, and folks will be willing to stand in line for it.
