In Monday’s post I mentioned that Marketing with Meaning can apply to any business, not just the large brands with multimillion-dollar marketing budgets. I shared an example of a book publisher that is uniquely connecting with its target readers. Today I wanted to share how even local restaurants can win by directing a targeted campaign using a single insight about its target market - at a very low cost.

To simplify a core part of our Marketing with Meaning model: Companies must begin by establishing a business objective they hope to reach. Once this specific business objective is set, the company then can put more focused thinking around how they can do something meaningful for customers that helps achieve the business objective. With these focused customer insights, they are then able to start crafting strategies and creative ideas around meaningful marketing.

In the restaurant business, a common business objective is to drive loyalty and visits from existing customers. Most of us know that in nearly every business, 80% of profits come from the 20% of loyal customers. My friends in the restaurant business tell me this holds for their industry as well. Their challenge is that there are many, many dining options for people to choose from, and any number of them can provide a similarly pleasing experience. So they must work hard to achieve a high “share of mind” with their customers. People also have a natural desire to “try something new,” so retaining loyal customers is a critical need.

Historically, most local advertising spending tends to consist of a stagnant group of traditional tactics. There are the Yellow Pages, Val-Pak direct mail coupons, and ads in the local city restaurant guides. Everybody in the business does these same things - which is another negative of such marketing. Part of the reason restaurants (and many, many other small local businesses) use these tools is that they don’t know what to do instead, and they worry that traffic will dry up when dollars are shifted. These businesses can’t afford to wait for a year for a new marketing approach to pay out. But, I’ve spotted two great examples in the past few months.

First up is Palomino , a “drop-in downtown restaurant” chain with about 10 locations across the country. At the end of each meal, Palomino provides a feedback card with an offer to join an email list for special events and offers. This is not too unusual. What is special is that Palomino asks a single question on the registration form: “What’s you birthday?”

With this information, Palomino sends an email to its customers once per year, about two weeks before this big day. Palomino knows that this is when people start to make plans to get a babysitter and hit the town. It includes a $20 voucher with the email to sweeten the offer, again, knowing that a birthday will result in extra revenue splurges such as dessert and bottle(s) of wine. For the customer, this email comes at the right time with a compelling discount. We customers feel inclined to repay the business that remembered our special day. The cost of putting together this offer is negligible, and the results can be tracked through email clicks and voucher redemptions.

The second example is from a local pizza chain called Donatos. It’s one of several large citywide chains and competes with the big guys such as Papa John’s and Domino’s. As I detailed on my Challenge Dividend blog a few months ago, I was pleasantly surprised one weekend to get a call from the manager of my neighborhood Donatos store. She saw that I placed an order during the past week, and called to ask for any feedback.

I was pretty blown away that a store manager would bother to make such a phone call. This small, focused, and personal effort makes a big difference in my mind when my wife asks me where we should order from on pizza night. I now know that someone appreciates my business and sees that I am important. Further, results of this effort can be tracked by simply looking at whether I order more often in the months ahead.

I love that both of these examples use specific insights to add value to consumers’ lives, they take very little time or money investment, and they are completely measurable back to the original business objective of driving loyalty. So if these guys can do it, what’s holding you back?

Studies show that we see 3,000 ads per day - and growing. Some companies are discovering how meaningful marketing can be a break from the pressure to interrupt, and I enjoy telling their stories here. But others are determined to find new ways to break into our brains with novel interruptions. McDonald’s has followed the latter path again, this time by paying for drink placement on the morning news of a Fox affiliate in Las Vegas (KVVU).

In analyzing this move, let’s first get the meaning question out of the way. I see no way in which McDonald’s sponsorship of the show can be considered a value-add to KVVU’s viewers. The same program appears, the same number of commercials are run, but one more unavoidable ad is layered on top of the news broadcast. You could even call it an unavoidable “pop up” ad. It’s just another (very clever) interruption.

Not only is this sponsorship lacking in meaning, but I think it crosses a line. Those of us who have spent any time in the news business (The Duke Chronicle for me) know that there is a fairly clear separation between “church and state.” Now, I admit that the local morning news - especially the Fox variant - is not exactly considered the temple of journalism. But it isn’t Coke on American Idol - it’s still the news. And it’s unfair for the news anchors, who are basically giving a personal endorsement to an iced tea in order to keep their jobs - thus further weakening their self-respect as journalists.

I find it interesting that the Meredith Corporation owns this and several other local networks that allow product placement on their news programs. Interestingly, Meredith has built a network of advertising agencies and does some in-house creative work for advertisers in its magazines. Perhaps that’s part of why the line is blurrier there.

The New York Times also reports that the cups of McDonald’s will be taken down in the event that the news team has to report something negative about the McDonald’s Corporation:

If there were a story going up, let’s say, God forbid, about a McDonald’s food illness outbreak or something negative about McDonald’s, I would expect that the station would absolutely give us the opportunity to pull our product off set,” said Brent Williams, account supervisor at Karsh/Hagan, the advertising agency that arranged the deal between McDonald’s and KVVU.”

I can see how cool business logic could allow for smart people to invest in product placement on a TV morning show. It makes a ton of sense to plant the seed of McDonald’s breakfast items just as people are hitting the road and consciously or unconsciously thinking about breakfast. Heck, it might even be a huge ROI for the company. But my gut is that today’s viewers will be just as likely to start a boycott against McDonald’s as they are to start a new iced coffee habit. Is it surprising that the FCC is beginning a move to regulate product placement run amok?

McDonald’s should have learned its lesson from the negative PR and late night television jokes about its advertising on report cards in Florida elementary schools. I think there are many other ways that McDonald’s can use its marketing to add value to consumers’ lives. This would include anything from a coupon newsletter to furthering its terrific Ronald McDonald House program. Such interruption tactics weaken the brand image in our minds and do nothing for long-term equity or loyalty.  Not to mention the fact that they don’t help the cause when cities such as L.A. want to ban your restaurant completely.

While McDonald’s might enjoy a tiny boost in its multibillion-dollar bottom line as a result of this program, I think it’s another way that our industry is killing itself and, frankly, weakening society. As Auburn marketing professor, Herbert Jack Rotfeld says, “In the end, they just make the audiences even more skeptical of everything.”

(thanks to Umair Haque for the find)