The Finch Post

Ron Johnson: A Case Study in the Perils of Success

 

Much has been written about the incredibly quick rise and fall of Ron Johnson as CEO of J.C. Penney. Central to his failure was his decision to forego testing his sweeping changes in merchandising and pricing / promotional strategy in a sub-set of Penney’s stores to gauge consumer reaction prior to rolling them out chain-wide. 

Lesson #1: When you’re Apple, you are in the incredibly rare position of leading the market; meaning you have built so much equity with consumers that they will follow you wherever you take them. So, it’s less about appealing to the whims of customers and more about introducing experiences and products that they will likely accept and adopt based on their trust in the brand. And, if a brand like Apple does misstep, customers may be temporarily miffed; but they won’t stop buying.

J.C. Penney lives in the world of the 99% of brands who do not wield the power of an Apple. Consumers have many suitable alternatives and their relationship with the brand is based far more on price/value than emotional qualities. As such, as the company implemented change, consumers had no problem defecting with the result of 25% sales declines in the year in which the strategy was rolled out. 

Which brings us to lesson #2: Brands must beware putting their futures in the hands of leaders who succeeded in completely anomalous situations. Granted, Ron Johnson contributed mightily to Apple’s retail success; but the cult of Apple was already a reality, giving Ron a brand foundation (not to mention unlimited access to capital) on top of which to build the most productive retail concept on the planet. 

Ultimately, his success at Apple clouded his perception of how difficult it is to introduce change in the real world – how diligently a brand needs to understand customers and how delicately it needs to treat them in order to evolve towards a position of greater brand strength.  

Through the Looking Glass

After Google announced its fascinating (and invitingly creepy) Glass project, the Internet fluttered with the expected Terminator jokes and occasional YouTube parody – and the marketing world quietly took note. Here comes a transformational new gadget from arguably the world’s largest, most powerful real-time advertising company capable of reinventing, as they did with search, the way we interact with and access consumers throughout their everyday life patterns.

For those unfamiliar with the Glass project, Google has developed a hands-free “eyeglass” device that provides the wearer an "augmented reality" experience. Google Glass is a small metal and plastic frame supporting a uniquely squared glass focal piece (hence the “Glass”) positioned to sit slightly above the right eye. When worn, the viewer is presented with a Google-branded visual experience – with access to taking and posting photos and videos, running searches and accessing other forms of content.

Augmented reality is not really a new tool for marketers, but has been something of a clunky, odd shaped tool that hasn’t yet lived up to expectations. QR codes allow us to take viewers to designated online destinations with some effort, and location-based apps help us find a curated set of restaurants, shops and points of interest. But all of this has been transactional and a bit frivolous – never fundamentally embedded in the way consumers live.

The way the smartphone (and all it has wrought) revolutionized the consumer’s relationship with the Internet, Google’s Glass is the frontrunner to finally integrate augmented reality into the marketing mix – making it something useful and indispensible for consumers and marketers alike. We envision the race to leverage the power of Glass to become very intense, very fast.

But before we start going crazy in the marketing community with the top ten lists, predictions and recommended approaches, let’s first consider some of the exciting realities that true augmented reality will bring us:

• Real-time discounts and promotions in the blink of an eye – We’re already using mobile apps to alert us when we’re within reach of some great deals, but always-on augmented reality gives us a moment to “see” the deal without ever having to go through the trouble of taking our phones and tablets out of our pockets and bags. Retailers can highlight items within the real store environment. Imagine walking down the grocery aisle and the sale items glow red!

• Revolutionary customer service – Brands can become first-responders where they would usually not have access. For example, a malfunctioning ATM could summon your Bank of America virtual teller for a live chat.

• Try it before you buy it – High-involvement purchases and big-ticket items may be easier to choose with the advent of augmented reality. Forget being able to virtually try on clothes – how about being able to try on furniture?

• Making environments truly alive – Imagine approaching a clothing rack and being able to access the rich reservoir of content about an item simply by glancing at it. Burberry has brought a bit of this logic into its flagship retail stores, but the new method would be even more seamless.

Though it will likely be years before Google Glass or other augmented reality devices become ubiquitous parts of consumers’ lives, marketers would be remiss to wait to explore the potential these methods hold for connecting with consumers. This is the logical extension of some of the interactive aspects of the brand dialogue we have tried to achieve with social media, tablets, QR codes and other techniques. Up to this point, these interactions have always required a somewhat disjointed extra step – very soon that may not be the case.

 

Will USPS Apparel Deliver?

There will be no shortage of both humor and outrage about the announcement that the US Postal Service is launching a line of apparel. While jokes are always welcome, we can dial back the outrage – this is being done via a licensing arrangement, so the impact in terms of taxpayer dollars ought to be very modest. And the “crowding out” effect of the USPS marketing a product in competition with the private sector is not really an issue here.

So let’s evaluate the topic on the merits – what will it take for such a launch to be effective? As always, the answer depends on the objective. Brands license their trademarks (and all that comes along with them) for several key reasons:

• To drive revenue in a relatively riskless way (assuming the licensee is well managed) – a typical apparel/accessories licensing deal gives the licensee an opportunity for most of the upside and the licensee, in turn, bears responsibility for selling, marketing, production and inventory management.

Assuming the USPS didn’t get hornswoggled here, there is an opportunity for (modest) financial upside. Apparel royalty rates generally fall between 5%-12% of sales (with some categories higher or lower). The “Rain, Heat & Snow” line would have to become a huge business for the royalties to make a meaningful difference for an agency that has run billion dollar deficits since 2007 and has both increased prices and cut services.

For comparison’s sake, rugged Carhartt – with 123 years of history, wide distribution and its own retail and eCommerce businesses – does around $500 M per year. If the USPS apparel business became Carhartt overnight (no shot), they would still derive only ~ $50 M in annual royalties. Hey, every little bit helps, but this is clearly not a major gap-closer in the USPS operating budget.

• Beyond the financial opportunity, organizations also use licensing to expand the consumer definition of their brands. The USPS, with an apparel line self-described as innovative, may be attempting to associate the agency with progressive and practical design – likely a far cry from how the American consumer sees it today.

They may also be trying to contemporize the view of their employee base, romanticizing the letter carrier as the intrepid, reliable facilitator of important messages that make life better – no matter the weather. This is potentially worthwhile given the role of health and retirement benefits in the current financial challenges faced by the USPS and the need to remind the public of the role of the postal service.

For semi-public organizations such as the USPS, Amtrak, NPR or other subsidized entities, increased brand understanding on the part of the consumer may lead to the critical public opinion shifts required for success in the political process.

Let’s face it – the post office is struggling not for lack of style, but because people send far less mail than they used to and because the private sector has earned a large share of the commercial business for packages and special deliveries. An apparel business will not change that, nor will it come anywhere close to addressing the revenue shortfalls that will persist as these trends continue.

But – and a big “but,” given all that has to occur to make this line compelling and widely distributed – a successful line of work gear inspired by the USPS may have the effect of broadening and hardening support on the part of those in whose hands the future of the USPS depends – the American taxpayer.

So put us in the column of slightly confused but mildly interested. At the very least, this is a creative way for a government agency to consider its path forward. If this becomes a laughable curiosity or the latest kitsch for a small segment of studiously ironic Brooklyn hipsters, it will fail. If the product has unique stylistic and functional statements that earn consumer attention and dollars, the USPS may reap limited but meaningful benefits.    

Target and Neiman Marcus Miss the Bullseye

Finch Brands, along with the branding industry in general, loves Target. It has proven that value need not be schlocky and has effectively democratized design for a generation of shoppers. And there are many in our world who despise Walmart, seemingly for aesthetic and political reasons, which leads to an even greater embrace of Target as its core competitor.

So when the usual suspects – MTV, New York magazine, Fashionista and Huffington Post among other tastemakers – breathlessly reported the Target/Neiman Marcus collaboration, one figured that the buzz alone would make it a hit. Imagine the consternation when these same media outlets were dutifully forced to report that the initiative has been a flop for both retailers.

We are not going to pile on as other media have – regardless of the financial performance, this type of initiative only enhances “Tar-zhay’s” designer cred and it represents both a surprisingly egalitarian and experimental side of Neiman Marcus that the world might benefit from seeing more often.

Yet it’s obvious why this failed where previous Target designer initiatives – from Isaac Mizrahi to Missoni – succeeded. Let’s be honest. When it comes to Target, never has so much love for a brand been expressed by so many people who never shop there. But Mizrahi and Missoni worked for those who do shop at Target because the retailer brought the designers’ signature aesthetic in core categories to consumers at accessible price points. Affordable luxury, a piece of a larger dream, something to aspire to – it was all there.

But this initiative brought consumers an Oscar de la Renta dog bowl. A Diane von Furstenburg yoga mat. Jason Wu Christmas tree ornaments. The problem was not (just) the price points. It was that the line was so frivolous, so pretentious, a smirk not a smile. Target customers aren’t fools – they are not striving to access only a designer’s name, but a designer’s magic. Yet the items that this collaboration served up would be the last thing you would buy from these labels, not the first.

Presumably, these consumers would rather save up to purchase Tory Burch ballet flats than spend $25 on the thermos she designed for this line. Imagine that. Perhaps we shouldn’t try to sell them the BMW silverware, Cartier slippers or Chanel coasters either.

So this episode leaves us with a clear set of lessons – which, by the way, do not include that diffusion brands are finished or anything risky and provocative is to be avoided. The simplest lesson of all – respect the customer – is, seemingly as always, the most important.

Walmart Pushes the Boundaries of Taste

Walmart has launched a food subscription service called “Goodies.” For a monthly fee of $7, customers will receive 5-8 samples, ranging from organic to ethnic products not currently carried on Walmart's shelves. If customers like the products, they can purchase full-size versions online.

This is a fascinating strategic initiative for the world’s leading retailer/grocer to undertake. The product selection and value proposition is distinctly un-Walmart – and it would be outside of their traditional strategy to see this as just a nice little standalone business that could be profitable but not of game-changing scale. So what is the point?

• Could it be to step a toe into specialty foods in advance of something larger in store? Walmart’s traditional value proposition has been known brands at low prices, yet other retailers such as Wegman’s and Whole Foods have built profitable businesses going beyond staple items. So one can see this as an attempt to use Goodies as a testing ground for a more specialized offering while minimizing downside and not interrupting their carefully calibrated planogram.

• Could it be to evolve the understanding of the brand in non-traditional customer segments? Walmart has tended not to be the choice of the affluent or adventurous shopper, but one can see how other brands with a strong value appeal (such as Costco and Target) have been able to build some caché while still comfortably appealing to value-conscious consumers. Goodies could be a precursor to an evolution of the Walmart brand image away from price as the leading driver or, more likely, to assert uniqueness alongside value.

• Could it be a nascent effort to cultivate a new model? It is significant that @WalmartLabs, an innovation arm based in the Silicon Valley rather than the corporate HQ in Bentonville, AR, is behind this initiative. Other startups (Birchbox, Love with Food) have initiated gourmet food subscriptions, and this may be a test to see if they are onto something.

So will it work? Success has a very different meaning for Walmart due to its scale, and if Goodies simply becomes an effective way to vet products the retailer may offer in store or online, there is value in that. It is unlikely that Goodies will ever grow to become a meaningful profit contributor for Walmart, but it does offer the company some valuable proof-of-concept opportunities. It also may enroll consumers in the first stage of a relationship with the retailer, which could lead to greater utilization of Walmart.com (versus, say, Amazon) for staple goods.

Our major question is whether or not the Walmart brand has the potential to benefit. While Goodies certainly won’t hurt, we are skeptical that it can do much to help in the short or mid-term. An almost irrational opposition to Walmart runs deep among those who feel the retailer has crowded out local businesses, that it underpays its employees and squeezes its vendors. We believe this springs from more of a commercial elitism than anything else and Walmart PR has effectively pushed back against those who have protested new store openings for various reasons. Its vision – “to save people money so they can live better” – is an effective antidote to those capricious criticisms.

Yet if Walmart is seeking to reframe the brand in the eyes of a more sophisticated consumer or hoping to summon the gourmet that lives inside its current customer, Goodies would only be one step in what would require a long march. It is unlikely that a non-Walmart consumer who is compelled by Goodies would see this initiative as reason to visit the store any more than they have in the past or for it to lead to a full-scale reevaluation of the Walmart brand as a fit for them.

Target became “Tar-zhay” largely due to major investments in making home accessories and apparel appealing via exclusive deals with name designers and a product mix offering affordable “luxury.” Costco brought in major electronics, wine and furniture brands to give the assortment and environment a differentiated kick within a quantity club model. Most importantly, these initiatives provided a “permission slip” for the type of consumer who needs one to shop at Target/Costco and to believe it aligns with their taste level. And this certainly did not happen overnight.

High Times - The 'What If' Business Model

 

Colorado and Washington voters yesterday passed referenda to legalize marijuana and essentially treat it the same as alcohol (controlled, taxed, etc.). While these states still need to work some things out – including how to reconcile this with Federal law – the profusion of medical marijuana dispensaries and a generational shift towards more permissive attitudes means a strong likelihood that there will soon be a much larger legal marijuana industry in America.

What makes this an interesting business issue is that there are very few recent examples of consumer industries shifting from illegal to legal. The more widespread legalization of gambling is one relevant case, but it has been more of an extension (from the longtime bases in Nevada and Atlantic City) into new geographies and has largely been overseen by experienced operators and limited to fixed facilities that can be easily regulated.

So what we may have with marijuana is the near unprecedented situation of a nascent industry with mega-billion dollar potential coming from the darkness into the light – yet still facing a heavy societal stigma in certain circles.

The key questions – fascinating to consider – include:

1. How would the market form?

Looking at the somewhat similar alcohol and tobacco markets, we see dominant, vertically integrated major players who have built a full production capability and supply chain. Given the public’s polarized point of view on this issue, but also the demand opportunity and need for scale, who would we expect to jump in?

Would the concern about brand dilution and loss of goodwill deter big companies from seizing this new market opportunity? Would smaller and less sophisticated suppliers be able to master the supply chain as well as demonstrate enough quality control to please regulators and consumers?

Beer, wine and spirits are complicated categories comprised of large market players and geographically focused craft or micro-brewers. Would we eventually see this in marijuana, with mass, value and premium tiers?

2. What would be the prevailing brand image approach?

Marijuana has been treated in popular culture almost whimsically in recent years, with an emphasis on the attitudes of the user. How would marijuana brands – with a wide open playing field – choose to create their personalities, looks/feels, etc.? How would they segment and target high potential consumer groups?

If you look again at the "adjacent" alcohol and tobacco industries, you see very clear and differentiated brand images – even with the regulations affecting tobacco companies. Marlboro stands for American independence. Newport evokes urban cool. More accepted and heavily advertised are beer brands also having clear images among major and boutique players. So how would brand builders approach marijuana?

3. Beyond image, how are product lines and sub-brands built and differentiated?

Consumer categories invest billions of dollars in nurturing brand and product differences based on innumerable factors – just looking at major beer brands, we see full flavor and "light" options, different colors, flavors/rituals such as lime and many other modes of product differentiation.

What would be the major points of differentiation in marijuana? One could easily envision potency, place of origin, flavor, light/full and many other dimensional attributes as enabling brand developers to make unique product statements.

Whatever one’s opinion, helping this category (and its users) take flight would be fascinating for business and brand builders – an undisturbed but massive landscape filled with opportunity and risk. There are very few such categories in American business – so we’ll be watching.

 

A New Era of Honesty in Advertising?

 

There are plenty of reference points – generally humorous – about truth in advertising and what happens when communications are stripped of their high production values and agency wizardry. From Crazy People’s memorable ad ideas (“they’re boxy but they’re good” for Volvo) to this recent Conan O’Brien sketch upon the launch of the iPad Mini, the conventional wisdom seems to be that advertising that is direct and honest will look and feel very different than most of what we see today.

But while we’re laughing along at these extreme examples, our consumer research and some high profile initiatives suggest that brand developers and agencies should be thinking about a more direct approach – now more than ever.

There are periodic critical junctures when consumer attitudes dictate that brands respond. When the concern about female body image reached a crescendo and it was clear the fashion world and Madison Avenue were not changing on their own, Dove launched its “Campaign for Real Beauty” in 2004. What was courageous then has become more conventional now, as major consumer brands now test the relatability of their models and tread very carefully. 

We may be nearing just such a juncture when it comes to directness in advertising. What we are hearing from consumers, across categories and with far greater fervor than in the past, is that consumers do not trust big _____ (insert “banks,” “box stores,” “companies,” “brands,” etc.). They do not want to be romanced or “sold,” they pride themselves on making their own decisions and they much more greatly respond to the few brands that communicate with them openly and honestly.

One specific example is the most recent Domino’s Pizza campaign – which is supported by real change to the business and product. Their “Oh Yes We Did” approach held within it an almost explicit admission that the company had gone adrift and needed to do better.

It featured close shots with the CEO at the center asking the marketplace for another chance and talking about the many ways the company has sought to earn a second look and reestablish trust. The frankness of this admission and willingness of the market to retry a once cherished brand has earned the company a 20% increase in its stock price in 2012, with a resumption of growth and much higher earnings.

While this campaign came from an established agency, was produced expertly and represented a brand that’s not exactly been an underdog historically, we believe consumers responded to the honesty and uncharacteristic vulnerability the Domino’s brand felt comfortable revealing.

Simple and direct are always strong principles to live by in brand development, but we are advising our clients that now may be a unique moment to be heard by taking a notably direct and honest approach to communications. There are leading indicators that this is the level on which skeptical consumers want to deal with brands and the more grandiose the message, the less it is believed.

The Top 3 Lies Consumers Tell In Focus Groups

 

 

We conduct hundreds of focus groups every year across the country for many different types of clients. While critics of this methodology have fair points – too few respondents, group think, inefficient use of data gathering resources – there is simply no substitute for the depth and texture skillfully managed sessions provide in understanding the "whys" that underlie consumer behavior.

Still, experience has told us that one can’t take everything a consumer says in a focus group to the bank (or even to heart). These are not intentionally misleading responses – so the title of this post may be a bit sensational – but rather are the result of asking the wrong questions in the wrong way.

Behold – the top 3 "lies" consumers tell in focus groups:

1. "Logos don’t matter on clothing – in fact, I prefer apparel without a logo"

We hear this in just about every fashion or general retail focus group we conduct and it’s simply not true. The reason they say this is that consumers do not want to seem shallow. Yet consumers do not seem to be sheepish sporting logos from Polo or The North Face, do they?

What they are really saying – and what is really true – are two things: (1) consumers will wear logos of those rare brands that say something positive about them and align with their values and (2) some brands, generally lesser regarded ones, can overdo the logo usage to the point that it dominates and detracts from visual appeal.

In fact, an important sign of a brand’s strength is whether or not a consumer would want to wear or carry the logo. Or, if choosing between shopping bags from a long day at the mall, into which bag will they put all the others (i.e. which store logo they will leave exposed).

2. "Advertising and celebrity endorsements don’t matter to me"

Consumers don’t want to be seen as gullible dupes, simply waiting to be taken in by a savvy marketer. We had a recent series of groups in a category that heavily advertises and uses celebrities during which consumers swore celebrities didn’t matter – but then it turned out the celebrities used were the only way they could tell leading brands apart.

There is a time and place for a well-chosen celebrity to endorse a product and only a sliver of all the advertising created provokes an immediate or meaningful response. Yet these things – like all effectively layered, strategically grounded and creatively excellent marketing campaigns have a cumulative effect and guide the consumer to their own answers and their own actions.

3. "The price is too high" or "The store is too far away"

There are certainly products priced in a glaringly different way from a consumer’s other choices or beyond an affordable range, but when a consumer mentions price, he/she is almost always speaking about value. This means that the price is high for what they get. There are some stores that are just too far away, but when a consumer mentions distance, he/she almost always means that the store is not compelling enough to go one block out of their way.

These are "easy way out" answers that consumers really believe – but that don’t penetrate the complex and multi-layered decision-making calculus that drives most consumer behavior. Would consumers pay an extra buck or two if they thought they were getting a better deal, all things considered? Of course. Would they drive an extra five minutes for a far superior experience? Definitely.

Marketers who hear these answers might be tempted to drop prices or reevaluate their real estate strategy – when what is really required is action to make the perceived value of their brand higher by a few bucks or worth a slightly longer drive.

Having done so many of these, we are able to separate what can be trusted from what can’t be – and, more importantly, build the groups to address these topics in more productive ways. There are a host of other whoppers we hear, but these are the most frequent. What about you?

 

How JC Penney May Have Destroyed Its Own Big Idea

 

JC Penney is one of America’s most prominent retailers, so its announcement of a new strategy in January 2012 generated headlines and a lot of interest in our world. Almost a year in, results seem negative – declines in share price, earnings and same store sales.

Perhaps just as importantly, this performance and some of the company’s own waffling has led to hysterical cries of “It’s not working” from the business press. This condition is of JCP’s own making, reflects its inability to manage expectations and may serve to doom one of the most compelling, big idea business strategies in recent years.

Here’s the rough background:

Having followed the rest of the category into an addiction to couponing and the increasing intensity of the hi-lo markdown shell game, JCP educated its consumers about when and (importantly) when not to shop. The company devalued its product assortments to such a degree that the only indicator of value was how many dollars off a consumer felt she was getting.

The new strategy is designed to represent a new pact with consumers. It consists of two core elements: (a) A “fair and square” pricing strategy that is consistent and coherent and (b) an evolution of its stores from departments into lovingly curated “brand boutiques.”

The proposition here is clear – stop chasing the impossible deal and we’ll give you pricing you can trust and understand, plus a significantly improved experience with a compelling mix of familiar brands and exciting labels that will be new to many consumers.

There is so much that’s right about this. The department store model is stale and needs to be reimagined. Prevailing pricing strategies are incomprehensible and quickly turn into an arms race, making consumers inherently suspicious and disloyal. JCP is moribund and needs a jolt of positive electricity.

This is designed to be a better retail mousetrap for company and consumer. A strike back against the fog and folly of the coupon culture that has taken root since 2008. A big, bold business idea of which there are so few today.

The major (and perhaps fatal) mistake has been in the sequencing. It was far easier to first change prices than to build the boutiques, so the company went ahead with that part of the strategy – and in a very public way via a new logo and splashy ad campaign featuring Ellen DeGeneres. The new concept is not complete without the boutiques – so the campaign was essentially saying, “Shop at the same place for the same stuff and receive fewer discounts!” How do you think that went over with consumers?

JCP itself contributed to the barrage of negative headlines throughout the summer by changing the pricing strategy, dropping the ads and appealing for calm. The stores underperformed, executives departed, the stock declined further.

Perhaps most importantly for the long term, this fiasco makes it seem that the strategy was really just about a logo and ad campaign in the first place. Creative work should exist to communicate a strategy, not disguise the lack of one – and here is JCP, with a revolutionary business approach in hand, prematurely turning to big budget TV advertising to sell an incomplete message and trumpet change when all that’s been different is the logo, fewer markdowns and less frequent promotions.  

There was and remains tremendous pressure on JCP to do something, which explains why they moved too quickly and why they flailed around this summer. The brand boutiques will not be fully retrofitted into all 1,100+ store locations until 2015 and one cannot sit and wait until completion to strengthen the business.

But will the company have the time to see its strategy through? CEO Ron Johnson, who earned Wall Street’s respect as the builder of the Apple retail business, continues to ask analysts and consumers to be patient and points to promising data on boutiques that have launched as part of a pilot program.

So the jury is still out, but unless the consumer and financial communities demonstrate far more patience than that for which they are known, JCP (and the retail world) will have cannibalized a rare, big, transformative idea. That would be a shame for all involved. 

Facebook Sharing Your Deepest Secrets with Marketers? Yes, Please!

 

So you’re on Facebook looking at someone’s baby pictures, and suddenly you notice an ad that’s actually relevant to you. Perhaps the ad is from a store where you shop all the time (and may have signed up for their loyalty card), but never got around to clicking their “Like” button.

Now – stay with us on this one – imagine that very same relevant ad, from a store where you shop all the time, went something like this:

“Hope you’re lovin’ that new shirt you bought last Tuesday! Click here to see some great pants we think would go well with it. And don’t forget, only $43 more to spend until you get your VIP 1-Day Savings Pass! So hurry back! You’re only 6 miles away, so what are you waiting for? Cashier Deb is looking forward to ringing you up again. Oh, and are Jenny and David ready for school tomorrow? We’re also having a sale on children’s shoes…even red ones, just like Jenny likes!”

The initial reaction would be to see who’s following you. Not on Twitter, but literally.  Well, Facebook announced that it will offer the capability for marketers to integrate customer data with Facebook’s user data in order to facilitate better ad delivery without revealing personal information.

Put the words ‘Facebook,’ ‘privacy,’ ‘ad’ and ‘corporation’ in the same press release and you have a simple recipe for a world class outrage-fest.  But hold the anger – we think this is actually going to be great for consumers. 

Many companies offer unique product, content and promotions to their Facebook users, so the better able they are to serve us with ads for brands/stores we actually like, the better for everyone, right? 

Consumers have the ultimate love/hate relationship with Facebook – without any seeming sense of irony, we complain about Facebook design changes and privacy issues on Facebook itself.  It is completely understandable to be vigilant about monitoring companies with whom we share personal information (even if it sometimes moves into tin foil hat conspiracy theories). 

Now, instead of laughing (or posting) about how mismatched the ads sometimes seem, we’ll be busy clicking on them and accessing great deals on products we may have purchased anyway. 

For marketers, this is a home run – many of our clients already have terrific results with Facebook advertising and now they can close the gap between social media and database marketing.  Instead of targeting people who like Sesame Street, Facebook is going to make it possible to reach a customer who bought an Elmo doll last Tuesday.  And that is something even Oscar the Grouch can smile about.