David.coms challenge Goliath marketers

March 15, 1999

BY MICHAEL KRAUSS

Do you ever feel sorry for the marketing Goliaths, what with all of these Internet Davids running around with their technology-based slings?

Why is it that Amazon.com - not Sears - is the web's reigning electronic retailing success? After all, Sears once was the greatest innovator in retailing thanks to its interactive marketing breakthrough, the mail-order catalogue. What does Jeff Bezos, Amazon's CEO, have that Sears CEO Art Martinez lacks?

Why are so many established companies playing-catch up on the Web? And if you work in marketing at Goliath Inc., what do you do when young David.com shows up?

The answer is pretty straightforward: You write a check to David.com and buy his company.

That's what sports retailer G.I. Joe's of Wilsonville, Ore., did with Douglas Spink, a 27-year-old entrepreneur from, Hillsboro, Ore. Spink, the founder and CEO of Timberline Direct, sold his Web- and catalog-based start-up to G. I. Joe's for an estimated $5 million. Not a bad payday for a guy who mortgaged his house, borrowed from friends and scraped together $180,000 to build the company (See Internet Marketing Leaders article).

Are there other options for Goliath Inc.'s marketing forces? Can you become more like the David.coms of the world? You can. Consider the formula Doug Spink followed for success:

Live your customer's lifestyle.
Spink is an ultra marathoner, routinely running footraces far in excess of the marathoner's usual 26.2 miles. He lives the lifestyle of the extreme athlete that he markets to each day via his Web site, Athletica.com. He invested every aspect of his company with his personal insights about the customer's lifestyle.

Believe passionately in your products.

Spink's web- and catalogue-based products range from sports nutrition supplements to snow boarding equipment and duck hunting supplies. He believes in his products, uses them and tests them himself.

Build a brand that reaches your customer's soul.
Spink says people do extreme sports activities, like distance running and cycling and triathlons, because they "meet some kind of spiritual-like need. It's done for its own sake. The process is important, not the outcome. We wanted all of our branding activity to reflect this fact."

Create a buyer-driven corporate culture.
Spink spends a lot of time answering customer e-mail himself. "I worked on the Web site, making it fun and enjoyable for people. We over-invested in customers. "

Put an obsessive-compulsive at the helm.
Said Spink, "I would make index cards of every item I owned when I was 8 years old. Every great brand has an obsessive personality behind it somewhere. Entrepreneurs who succeed use obsessiveness as a tool."

Pay attention to the details.
"I care about the paper. I care about the boxes. I care about the packing peanuts. Those things combined build an organization, build a culture and ultimately a brand. It's not the mission statement. It's what you actually do, it's not what you say you do," Spink said.

Hire great people.
"Then you sit back and chew your fingernails. At a certain point you realize if you don't come to the office for a week, things just go on fine without you."

Trust your own counsel.
Spink is action-oriented, saying, "Don't hesitate to make decisions that come from the gut. Don't hesitate to make decisions that are controversial. Do what is right, not what is in some book."

Reflecting on Doug Spink's success as a David.com entrepreneur raises the question of the future of the Goliaths of the marketing world. Can you imagine Art Martinez of Sears passionately cutting wood in his basement with his Craftsman tools? Can you envision an emotional Durk I. Jager, CEO of Procter & Gamble Co., in the laundry room extolling the virtues of using Cheer to do the wash? Could you visualize Kraft Foods CEO, Robert Eckert, enthusiastically preparing a macaroni-and-cheese dinner in the kitchen? Maybe they do.

But I'm sure that today's interactive marketing Davids will continue to collect big buyout checks from traditional marketing's Goliaths for some time to come.

Michael Krauss is a partner with Diamond Technology Partners in Chicago.
He can be reached at news@ama.org.