Tuesday, July 3, 2012

Marketing Insights of the Grateful Dead

One of the more beachable business books I’ve read is “Marketing Lessons from the Grateful Dead. What every business can learn from the most iconic brand in history” by David Meerman Scott and Brian Halligan. It's a fast, 156-page read of the Dead’s marketing breakthroughs, coupled with examples from other industries. It includes helpful application tips (labeled “Rock On”) for your own business situation. Here are my top 3 takeaways:

1. Be on the lookout for new business models. The Grateful Dead pioneered a multitude of new business practices. 
  • Unlike other bands that relied heavily on selling records, the Grateful Dead made their money primarily from concerts and merchandise. 
  • The Dead eliminated the middleman by selling tickets directly to fans rather than going through major ticket sellers.
  • And finally, they pioneered relationship marketing by including the following on one of their record sleeves:

Who are you? Where are you? How are you?
Send us your name and address and we’ll keep you informed.
Deadheads, P.O. Box 1065, San Rafael, California 94901

New business models are even starting to emerge in the traditionally risk-adverse pharmaceutical industry with Pfizer’s new approach to the Lipitor patient expiration being a prime example. Rather than let brand sales plummet into the sunset, they extended Lipitor sales by selling directly to patients—at a generic price—by enlisting help from specialty pharmacies. With all the upcoming changes in the healthcare industry, it pays to invest some thinking time into how medicines can get into the hands of patients more quickly and cheaply.

2. Experiment and continually adapt. No two Grateful Dead concerts are alike. The Dead experimented continually as a group, and individually, both on and off the concert stage. This uniqueness increased the value of their concerts and concert tapes.

In applying this relentlessly innovative mindset to the practicalities of business, the authors advise that “marketers should shorten their planning cycles to monthly—versus six to twelve months out—in order to become more agile in response to changing marketplace dynamics, new product developments, changing competitive landscapes, and new marketing technologies.” 

While a monthly planning cycle might be impractical, it does make sense to plan for regular quarterly reviews to evaluate the current direction and environment. At the annual planning session, it would make sense to: 
  • highlight how the environment could change 
  • note how you will monitor the potential change 
  • identify some alternative ways to address any environmental shift 

Ask your team: What if a competitor comes out with better than expected data? What if your brand suddenly has a shorter or longer expected life? Identify and plan for these potential pivot points.

3. Get some fresh perspectives. One of the reasons why the Grateful Dead was so innovative was that the band members came from diverse musical backgrounds. For example, Jerry Garcia was also a bluegrass banjo player in addition to rock guitar. To think more expansively about your team, the authors suggest searching for employees using very broad criteria, such as finding someone who is good with numbers and someone who is good at getting found.

A more practical approach for the upcoming 2013 planning season would be to locate a few people from different industries and brainstorm around a key issue; say, retention. Or encourage each team member to take a course outside of healthcare. That’s how we encourage our extroverts to expand their thinking. For example, one of our extroverts will be taking an online course with Berklee School of Music on Online Music Marketing. Just thinking about how you would develop a fan base is sure to result in some new acquisition and retention strategies.

The book is full of lots of other practical business advice engagingly served up with tales of the Grateful Dead and their loyal Deadheads. So put Marketing Lessons from the Grateful Dead on your summer reading list. Try bringing the book to work and reading it at lunch; it’s sure to start a new conversation and that’s what you want.

Thanks for letting us share.

Next Wednesday’s post is about setting up metrics that can help your brand succeed.

To read previous 2013 Planning Thought Starters posts about:

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