data

How Branding Can Position an Entire City in the Global Competition for Jobs.

Marsha Lindsay on January 26, 2011 ·

This blog entry originally appeared at In Business on January 4th 2011.

As a place to start and grow a business and family, Madison is a good place to be. The city’s many kudos are well deserved. But the community’s self-concept as exceptionally intelligent and creative is starting to raise significant questions in the minds of many:

Is it making us averse to change out of fear we’ll lose the great quality of life we already have?
Is it blinding us to how other communities are innovating faster, and more boldly than we are?
Is it making us overconfident that we know what’s best for each other, prompting us to get tangled up on petty stuff, when we should be devoting everything we’ve got to bigger needs and opportunities?

I worry about this because the data is clear: Madison’s changing demographics, stressed school system, aging infrastructure, air and water quality are all canaries in the coal mine of some real challenges threatening our quality of life. The stark reality is that addressing these challenges will take a lot of money. Soon. And let’s face it, whether in the form of consumer spending, philanthropy or tax revenue, the dollars funding fresh solutions and Madison’s very quality of life are fuelled by jobs.

We’ll all loose a great deal if Madison is not competitive at retaining, attracting and enabling job creators. And if we think we’re immune to the global competition between cities to optimize conditions for job creators, we’re kidding ourselves. The world-wide recession has made the stakes very clear: Madison is in a globally competitive race to fund our very quality of life.

This is a race we didn’t choose to enter. But given the stakes we have no choice but to do what it takes to win. That requires:

A vision of the future the whole community embraces,
A clear strategy on how to get us there,
A deep understanding of what’s critical to the creation of good, high-paying jobs;
A means to provide it –that’s significantly better than what’s offered by competing cities;
And finally exceptional collaboration to make it happen.

Three trends that define Madison’s challenge

Recently, over 1000 business and community leaders prepared for the race via the Greater Madison Chamber of Commerce Annual Dinner. They had their brains stretched by Dr. Colin Harrison, director of IBM’s Corporate Strategy team which created a knowledge base of best practices referred to as “Smarter Cities.” Its insights are being used around the world, from Germany to South Korea to Dubuque Iowa, to boost the global competitiveness of local economies. Harrison explained that to be an even smarter city, Madison has to understand and leverage three world-wide trends:

The first trend is that other cities around the world are competing for the same jobs, entrepreneurs, capital and new discoveries as Madison.

They’re doing it with new technologies and predictive modeling in order to uncover insights that fine tune municipal services, health care, transportation, education.

Some are doing this just to get to parity with cities like Madison or other cities already favored by job creators. But the smartest cities are using technology and modeling to go beyond parity to differentiation, creating relevant, one-of-a-kind offerings.

The business term for this ‘relevant- differentiated offering is brand strategy. The most successful cities are branding themselves with innovative and substantive offerings that have compelling benefits to job creators Next the cities are working to become famous for those qualities among business decision makers and knowledge workers.

As much as we in Madison would like to believe we’re the center of the Universe, recent research shows Madison is not famous, not even close. In fact, we’re not on the radar screens of 86% of business decision makers around the US.

So no matter how great things are here now, or how much more amazing they could get if we truly differentiated ourselves from other cities to meet the needs of job creators, Madison will be unable to compete in the new world order if job creators or venture capitalists or knowledge workers don’t even know we exist!

A second trend is an increase migration from rural to urban areas, something Madison has experienced over the past decade.

While this enriches our diversity and creativity, it creates stresses on land use, energy and water consumption. It brings more cars, puts new pressures on the K-12 schools, and demands on colleges to retrain workers, and more. Like the smartest of cities elsewhere, Madison will need to get our collective heads around some bigger ways to deal with this productively, and cost efficiently. Again, technology and predictive modeling have huge potential here.

The third trend is what many call the data revolution. We’re all a part of it—because all of us produce huge amounts of real-time and anonymous data 24/7 about our preferences and behaviors.

It’s coming from the geo-locators on our mobile phones, our Internet searches, our real world and online shopping habits, our traffic patterns, energy and pharmaceutical usage, the information we willingly share when we blog and tweet and “friend” others on Facebook.

The good news is that, properly and ethically tapped, mined and predictively modeled, this data can be used to make our lives easier. It can save time and money for the city, schools and health care institutions, help us to use water, energy, medicine more intelligently, help traffic to flow better, help differentiate Madison in ways important to job creators and those they employ, and all in all, help make living here even better than it is already.

As Dr. Harrison said, “While social behavior on the Internet gets a lot of headlines, it is surely social behavior in the real world that matters more.” The ability to capture data about what is happening in a city and integrate it can provide innovative and transformational approaches to solving urban issues and make cities like Madison not only smarter in their efficiency but also brand us as a globally competitive location for investment, job creation and quality of life.

These three big trends are made all the more powerful because they’re converging and being smartly leveraged by cities to improve their operational efficiency, quality of life and ability to create and compete for jobs. Madison would be wise to leverage them too in order to underwrite the standard of living we want for ourselves, our kids, our neighbors.

Our to-do list

Are we wise enough to embrace our ‘to do list’ and act on it quickly? Or will a false sense of confidence blind us? A prolonged debate divert us? Fear of change stall us?

How we answer these questions is important because, frankly, there’s far more than Madison’s economy at stake.

Madison exists in a state with a sizeable budget deficit, and the sectors which have long driven our state economy are not growing. That’s why more and more people believe the savior of Wisconsin’s economy is in fact the Madison economy: We already generate world-class discoveries, inventions, entrepreneurs. And the more globally competitive we can be at this, then the more good fortune will multiply and benefit the whole state.

This means the vision for Madison we all need to embrace is clear: Be among the top 5 cities in the world for job creation. The strategy to get us there? Create, by global standards, the one-of-a-kind and highly relevant culture needed to birth, attract and retain job creators.

Critical to this is a world-class quality of life for everyone who lives here. But given that it’s funded by the consumer spending, philanthropy and tax revenue that come from jobs, the first step is to focus on what it will take to create jobs here over the likes of Zurich and Shanghai, Boston and Boulder.

To compete against the best of the best, Madison, it’s time to think bigger, act more boldly and collaborate like never before. We’re in a race to fund our very quality of life. And we’re already a bit behind.

Marsha Lindsay

UPDATE: Madison job growth exceeds other metropolitan areas in Wisconsin

More from IBM Smarter Planet Initiative:

IBM have developed sophisticated sensors and software systems to let individuals and companies measure and manage gas, electricity, and water usage; power-grid surges; traffic congestion; pollutants in rivers and other bodies of waste.

For Organizations:

A recent study by the IBM Institute of Business Value, leading organizations use smarter working practices more extensively than lower-performing peers, resulting in greater efficiency and increased growth. They employ systems and practices that encourage collaboration among employees, customers and partners, and foster the creativity and problem-solving that enable the very act of enterprise.

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Why you don’t drink Coke out of a sink and why you should always order first in a restaurant.

Amy Rohn on August 13, 2010 ·

What we learned from Dan Ariely at LSB’s Brandworks University

A purchase may seem like a relatively easy concept. But as noted behavioral economist Dan Ariely told attendees at Lindsay Stone & Briggs’ Bandworks University 2010 there is a lot more going on in the mind of the purchaser than a simple cash for goods or services transaction. And, according to Ariely, we, as marketers, should think about certain human weaknesses, namely a lack of self control, and create mechanisms to help people make better purchase decisions.

When it comes to self control, Ariely talked about consumers overemphasizing the present and undervaluing the future. Anybody who has ever tried to diet, tried to start an exercise program or committed to saving money for the proverbial rainy day can understand this. Temptation is all around us. Temptation to cheat on the diet, hit the snooze button instead of going for the jog or spending on the pricey new toy instead of saving.

Ariely offered solutions to the issue and discussed the implications for marketers.

Reward substitution involves getting people to use surrogate rewards to get them to act a certain way. A given reward may be too far in the future for a consumer to be motivated by it. Reward Substitution provides a proxy reward that allows a consumer some benefit in the near-term.
The second solution Ariely discussed was a self control contract. Think about Ulysses and the sirens. He overcame temptation by forcing his future self to avoid the siren’s song by getting his crew to tie him to the mast. Perhaps a more relatable example given by Ariely is a diner in a restaurant telling the waiter to keep the dessert tray away from the table, thereby insuring that your future self does not indulge in the chocolate mousse.

So, what does this mean for marketers? Well, it means that consumers don’t behave as economic theory predicts they would behave, because so much of their behavior is based on irrational tendencies that they don’t necessarily even see.

It means that we, as marketers must be more systematic and experimental in our approach. We can’t rely on our intuition because out intuition is flawed by this irrational consumer behavior.

One of the most obvious manifestations of this irrational consumer behavior can be found in the psychology of money. Economic theory tells us that we should consider the shadow value of money or the opportunity cost of money whenever we make a purchase. But Ariely’s research reveals that nothing could be further from the truth.

In fact, consumers have a very difficult time understanding what they’re giving up when they make a purchase. He tells us that because we can actually do so many things with money, we can’t calculate the opportunity costs. So what consumers tend to do is rely on habits. They assume what they have done before, say spent $3.00 on a cup of coffee, was the right decision for some reason, so they repeat the behavior and it becomes the standard.

BRAND’S INFLUENCE ON BEHAVIOR

So, where does the brand come into play in all of this? Ariely’s research shows that the brand actually can alter the consumers experience primarily because it sets expectations that the consumer has. Ariely shared research related to blind and non-blind taste tests or tests where aspects irrelevant to the taste of a product were changed. In each case the brand changed the way a consumer experienced a product.

When consumers thought that a medication was a national brand, they claimed it worked better than what they thought was a store brand when in reality, the medications were the same. Golfers who through they were playing with counterfeit clubs didn’t play as well as they did when they thought they were playing with the real deal even though the clubs were actually the same. In a test of sunglasses, consumers reported that they worked better when they thought they were Armani sunglasses rather than an off brand. Of course, the sunglasses were the same. It was the consumers’ expectations that were changed by the brand.

And speaking of expectations, what about the title of this blog post? The first commenter who can explain what it means relatively to Ariely’s research gets a free copy of his book, Predictably Irrational courtesy of LSB.

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Privacy: Now Impossible? Thus Irrelevant?

March 15, 2010

Dateline: February 2010. International think tank in Zurich. Debate: What is the future of marketing given the impact of data that comes from social networks as people share more and more about themselves with friends, strangers and companies? Hmmm: The founder of Facebook has just said that in the age of the Internet, privacy is [...]

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Getting your Target to Spend More

September 28, 2009

Many experts agree that while the economy may have bottomed out it’s going to take a while for consumers to start spending again. Which makes the topic of LSB’s 20th annual Brandworks University (May 24 – 26, mark your calendars now!) all the more compelling and timely. The 2010 Brandworks will focus on getting folks [...]