The Episode in 60 Seconds
Before the pandemic swept the world, there were rumblings. There were rumblings about an economic downturn. Plus our culture was already beginning to debate many topics. There were tremors showing up on the business Geiger counter.
In this episode, we listen back to a prescient interview with Dr. Jeff Cornwall, a professor from Belmont University and a B2B tech (medtech) executive, recorded at the end of 2019. We discuss and comment on:
- The economy and the implications of the volatility of the market
- How CMOs should lead knowing that there will always be a future crisis just over the horizon
- How companies should view the changing generations. Millennials have buying power and Gen Z is graduating college.
- How the soul of a brand should (and should not) address cultural change
- Marketing lessons learned during the pandemic
Our GuestDr. Jeff Cornwall is the inaugural recipient of the Jack C. Massey Chair in Entrepreneurship and Professor of Entrepreneurship at Belmont University in Nashville, Tennessee. He served as the Director of the Center of Entrepreneurship at Belmont from 2003-2013.
Dr. Cornwall has spent more than forty years as a serial entrepreneur and teacher of entrepreneurs. In the 1970s he started several small businesses and was involved in various family ventures. In the late 1980s, following several years in academics, Dr. Cornwall co-founded Atlantic Behavioral Health Systems in Raleigh, N.C. and spent nearly a decade leading the company as President/CEO. After growing to more than 300 employees, he and his partners sold most of their healthcare holdings. After the sale, Dr. Cornwall decided it was time to return to the classroom to share his experience and knowledge with aspiring entrepreneurs. Dr. Cornwall remains active as an entrepreneur with the digital content venture he co-founded in 2014, Entrepreneurial Mind, LLC.
How to Handle a Coming Economic Downturn
- be prudent
- hold on to more cash
- be careful making big purchases
Marketing is all about creating market presence, maintaining momentum, and awareness. There’s never a better time in the context of any kind of correction to make an offensive, proactive, strong move. - John Farkas
How Do You Handle PR Crisis?
The Cultural Upheaval We Face Affects the Soul of Your Brand
Subscribe here to get a sneak peak every week.
Mark Whitlock (00:00): Hey, this is Mark Whitlock from Studio CMO, and I wanted to quickly give you a roadmap—or maybe I should say a calendar—for this episode of Studio CMO. For the first segment, you’re going to hear excerpts from an interview recorded at the end of 2019 with Jeff Cornwall. Dr. Cornwall is a professor at Belmont University and is a serial B2B tech entrepreneur in his own right and now leads an organization called The Entrepreneurial Mind, which educates entrepreneurs around the world on how to think and how to act and how to lead their companies. Our CEO here at Golden Spiral and the host of Studio CMO, John Farkas is going to add some commentary throughout that interview. Like I said, the interview was recorded at the end of 2019. John’s commentary was recorded in January before the pandemic hit our country. And the very end of this episode, you’re going to hear some commentary recorded in the last few days. John’s going to respond to the question, “What have we learned about marketing during the pandemic?” So we hope you listen to the entire episode. Dr. Cornwall was very prescient in what he had to say, and John’s commentary is incredibly relevant as we continue to live through the effects of the pandemic and we enter some more interesting times ahead.
Mark Whitlock (01:21): Getting a business and marketing that business to your audiences sometimes like flying a plane, you’ve got a flight plan, you know, where you’re headed, you’re on route and you can track everything perfectly. And sometimes it’s like flying through the Bermuda Triangle more often. We’ll find out what we’re flying today. And just a minute on Studio CMO.
Mark Whitlock (01:57): Welcome to Studio CMO. I’m Mark Whitlock here with our host John Farkas, cohost Angus Nelson on Studio CMO. Just as a reminder is the podcast shaped by Golden Spiral. We are a brand and marketing consultancy agency dedicated to the B2B tech space. And we’re so glad you’re along with us today.
John Farkas (02:17): We’re going to have fun now.
Mark Whitlock (02:17): And today we’re going to have the pleasure of talking to a fourth bald dude. I had the privilege recently of sitting down with professor Jeff Cornwall.
John Farkas (02:25): Dude has a beard to end all beard.
Mark Whitlock (02:27): He does have a beard to end all beards. And you can see that when you come to the show notes at studiocmo.com, you can see a great picture of him. Anyway, Jeff is a friend, a longterm friend.
John Farkas (02:36): And an icon in our fair community.
Mark Whitlock (02:36): He is. And just to give you a little bit of feedback on Jeff, he is a serial entrepreneur in his own, right? And he’s started and exited many B2B, uh, healthcare companies in his time. Uh, he not only continues to teach budding entrepreneurs at Belmont university. He leads an organization called The Entrepreneurial Mind producing content to help train entrepreneurs and great great stuff. If you want to hear all about is content development, mentality, and philosophy, you can listen to the whole interview with Jeff, but I’m getting away from that.
John Farkas (03:11): There’s one more important salient facts. Here we go. He’s a pack. He’s a packer fan. He’s Wisconsin guy. So we’ve got Nashville. We’ve got green Bay. What more do you need? And he’s got a bald top of his head.
Mark Whitlock (03:33): We talked about a lot of things that I interview and you can listen to an interview. When you come to studiocmo.com. We have a link out to that interview, but there was a segment of his interview. Actually, there were several segments that we’re going to interact around today. And the first one has to do let’s let’s, let’s dive into this one. First, the coming market adjustment. You can’t read anything on the internet. You can’t pick up a copy of the Wall Street Journal or the Financial Times without seeing an analyst talking about the challenges that are coming, uh, as Peter Smith, our president has said, winter is coming and we’ve prepared for that. So let’s listen to what Jeff has to say about the coming market adjustment.
Mark Whitlock (04:15): As you look ahead, let’s think just in the next 12 to 18 months, okay. Put your sage hat on a little bit tighter and let us know what are a couple of things you see that are going to be big challenges for those with an entrepreneurial mindset. What’s, what’s coming down the pike.
Jeff Cornwall (04:36): Um, to me, the big one that stands out is that we are overdue for an economic adjustment. And whether that’s simply a, uh, big market correction or it’s a recession, or it’s a deep recession, no one ever knows. We can never predict these things and people who do, and then in hindsight, they see, I predicted it. They were just lucky because, you know, there’s, there’s many other people just as smarter than that said, it wasn’t going to be that it wasn’t. So, you know, we all look really great in hindsight. So, um, it creates an added bit of uncertainty for entrepreneurs right now that is real. It doesn’t just play out in the demand side. It can also play out on the interest rate side and many different arenas. And so, you know, one of the things I’m telling entrepreneurs right now is not to be panicked, not to crawl into your shell and hide, but just be prudent, be careful, be thoughtful, give an extra bit of thought about signing that new lease or buy that new piece of equipment to make sure that that you’ve got enough financial cushion, that if your projections aren’t as robust as you think they’re going to be, that you’re still fine with that decision.
Jeff Cornwall (05:52): And so I never liked to tell people to retrench, but I think it’s a time to be careful and be prudent because I think we are so far overdue from an adjustment right now, rarely do do cycles last more than about four or five years historically. And we’re in now another one that’s been 10 years and it’s 10 years with lots of signs of, as economists and finance people talk, sort of that frothiness, et cetera, the things that might not be real. And so I think just a bit of caution is a good thing. And I think also be a little more financially conservative. I’ve told several people I work with on some boards and stuff. And I tell them, you know, you might not want to give out those bonuses to the owners this year. I know we’ve got the cash, but what’s, what’s the cash goes into your bank account at home, any coming back.
Jeff Cornwall (06:49): And it might be good to have a little bigger war chest to weather the storm. And, and if I’m wrong, put it out two years from now. It’s still there. It’s still cash. It’s still okay. But I’ve told people to, you know, to just, just an air of caution right now, particularly because we have such volatility politically now, and economically, it’s sort of a double whammy and, and we have no idea what’s going to happen. And we have no idea, whatever happens, what the consequences of that are going to be. And so let’s be a little cautious,
Mark Whitlock (07:22): Dr. Jeff Cornwall of The Entrepreneurial Mind at Belmont University, we are long overdue, as he said, for something to happen. Therefore, the cap is going to pop up at some point, how do we need to market during this time? And if an adjustment does come, what do you recommend John?
John Farkas (07:40): Well, first you need a crystal ball. Oh. And if you’ve got one, you’ll be in good shape. No problem. Do you have one Angus? I’ve got a crystal ball. Okay. Who’s got one? If you had sat at a table with me three years ago and said, is the adjustment coming? I would say, yeah, it’s eminent. I may have even made some financial decisions based on that. And I may be living in regret of those financial decisions right now. So my first point is, and you know, much, much, you know, along the tracks of what Jeff was saying, we don’t know. We can plan for it, but what are you planning for?
John Farkas (08:21): Unless you’ve got a crystal ball that says when the curve is going to start, we can be ready and we can be on our toes. The bottom line, you can’t flip a switch and say, you’re ready. The thing about marketing, we’re all about creating market presence. We’re all about maintaining momentum and awareness. There’s never a better time in the context of any kind of correction to make an offensive, proactive, strong move. Then when the market dips down, because everybody else is panicking. If you the steel in that moment to keep that moving, to keep the momentum going, you’re going to win. It’s gonna hurt. It’s gonna hurt for a minute because you’re going to set stuff out there. But what you’re doing in that time, when everybody else is pulling back, you’re making a bolder statement. Your brand is coming out farther. It’s costing you less to make a bigger impression in those moments than it would if you tried to regain that after.
John Farkas (09:20): And so I would say stay the course. And if anything, if you can find a way to do it, push harder, because what you will do is you’ll assume, and this is no guarantee. You might have a competitor thinking the same way, but if you can have some strong resolve the midst of a pullback, you’ll win because it’s going to take some time. You’re going to come out of it. When you do, people are going to know your name and that’s what we want. You know? So if you can convince all the parties to be a say, this is the time to invest. It’s a sound strategy. You can draw this parallel over to real estate. If you can afford to buy in a down market, when you know it’s going to cycle back, that’s the time to do it. Similar thing in gaining market share.
John Farkas (10:09): When everybody’s hands off in the context of a down market, people don’t pay less attention to what’s going on. They still are out there looking. They’re still thinking, okay, what do I need to, you know, how do I help my business win? And if you’re the one out there in that moment, making the stronger assertions while they may not be able to afford it this minute, or while they may have their budgets cut a little bit in this minute, that minute is going to pass. And then you will be there. That’s the opportunity.
Mark Whitlock (10:39): So from a strategic standpoint, we’re talking about staying the course and if possible, push harder from a tactical standpoint, are there tactics that are foolish in a situation like this?
John Farkas (10:51): You don’t want to assume that everybody’s ready to buy. I mean, that, that’s the thing, because the truth is they aren’t. And so what it is, it’s a market share. It’s a future you’re betting on what’s going to happen. And you’re positioning for the hockey stick to happen. When the things start getting better, you’re going to be in the lead position. You’re going to be in a better position than the people that went quiet and went away. And so that’s the opportunity. You can’t come at it and expecting people to buy, because then you’re going to look foolish.
Angus Nelson (11:19): What are, what are some of the brands? I mean, obviously everyone’s different, but is there any advantage to a strategy that says, if this thing should go sideways, this is our game plan. Like already preempting with a plan of how we do assert ourselves into those conversations.
John Farkas (11:36): You know, Angus, good question. It’s really hard. It’s going to be very con it’s going to be very contextual because you might be in a pro depending on where you are in a product development cycle, depending on what the competitive field looks like, depending on what there’s any number of different, uh, factors that go into that equation. I think the, I, the call is to be ready, you know, to know when it happens, you’ve, you’ve already made a decision that we’re going to go into the strong. And so you determine when it happens, when you start seeing the signs, when that goes, you go, okay, we’re going to move into this mode. Now that’s the opportunity. And it’s hard because depending on the situation that the company’s in and what you’re able to do from a fiscal perspective, that’s going to have all kinds of factors in there, too.
John Farkas (12:26): So it’s going to be a very fluid momentum. What you can do from a marketing perspective, it starts seasoning conversations on the executive team in that direction, say, Hey, if this happened, then this is how I would like to respond. Here’s the reasons why, and build some case histories in the context of your market, because all this stuff is showable. I mean, you can do some research on what happened in the last recession and how things spared and your verticals, if they existed then, and bring that forward and say, here’s why I think we should do it and start making the case, because nobody wants to talk about spending money when it’s happening. If you can have that seasoned and let them know, here’s what I think we should do. That’s prudence, you know, and at least then you have a better shot at it because you’ve already had the conversation when it’s a little easier to have than when people are panicking. So that’s the, if I have a plan, Hey, let’s start having that conversation now and seasoning it because I really think it’s time to carpet diem when things are going backwards, it hashtag prudence plan.
Mark Whitlock (13:35): So let’s head back into another clip from Dr. Jeff Cornwall. This time we’re going to take a look at what’s happening culturally.
Mark Whitlock (13:40): What about from a marketing standpoint? Is there anything entrepreneurial companies in that, that phase of growing and growing and growing that they need to be cautious about in the next 12 to 18 months or aware of to take advantage?
Jeff Cornwall (13:57): I think we’re now entering the age when the millennials are starting to have earning power. And so to me, that’s an interesting time because they have different priorities. We’ve heard so much about them. We’ve talked so much about them and not much of it has been reality until now, but now they’re getting into their thirties and they’re having families. Many of them, not all of them, but many of them in there, they’re kind of getting settled and they have some discretionary income and they’re making decisions about where to spend it. And it’s different than Generation X, which is different than the Baby Boomers. And so paying attention to the millennials as a purchasing block, I think is going to be really important. We’re also starting to see Gen Z come out of college. And, and so that’s a market. We need to start now to pay attention to.
Jeff Cornwall (14:49): So we understand them. They start to have purchasing power. They don’t have purchasing power now, but they will in five years, 10 years. And so we may need to be kind of get positioned. Uh, we’re not quite sure what they’re going to look like. Um, they are, they’re more similar to the Millennials than the Millennials were to Gen X, uh, but they are fundamentally different. And so, uh, you’ve gotta be, you’ve gotta be aware of that. And I think one of the things that that’s a huge challenge is we have a lot of social change in this country right now. And we have a lot of topics that used to be commonly talked about that are now taboo and things around gender things, around all kinds of topics that used to be just common everyday conversation. Now we have to think these things through, because right there is backlash.
Jeff Cornwall (15:47): I mean, one of the examples that’s going on as we’re doing this podcast and we taping this at the end of 2019, is what seemed like an innocent commercial by Peloton, the, the bike company and the guy bought his wife a Peloton bike for Christmas. And, you know, it wasn’t that she was morbidly obese and he was trying to say slim down, honey. I mean, she, she’s not, and there’s no transformation in the storytelling in the ad, but that ad has had an amazing backlash against the company that they they’re kind of going, wait, what just happened. And so I think there’s a, there’s a real, you know, in addition to economic and political turmoil and transition uncertainty, we now have for the first time, probably since the sixties, major social transformation and, and, and uncertainty that could be even the most dangerous. And we had to be very careful about that, you know, right or wrong agree or disagree. That’s a different conversation. We can have over a cup of coffee or a beer, but it is what it is. We have to be sensitive about that. I mean, I, I have to be very cautious and what I say in my content, what I say in my classroom, do I agree with that? Do I think it’s right. That doesn’t matter. It is. And, and there’s going to be a backlash if I don’t handle it properly, according to the market, uh, you know, the one thing is always true. The customer’s always right. We don’t always agree with the customer, but they’re always right. And they’re right on this now, because this is how they’re reacting to this. And like it or not agree or not, we have to, we have to be ready for that.
Mark Whitlock (17:32): We are living in a time of cultural upheaval. We’re looking at where we are. And when it’s hard to open one’s mouth and speak of, without the worry about how words might be taken, this lends itself. We were talking off mic, before we began today, that there are a lot of different departments within a company that are going to be effected by this cultural upheaval. So let’s start with the role of the CMO. How will the CMO need to be prepared to respond if something, if the CEO steps in it?
John Farkas (18:05): Yeah. Well, I’d say the first thing is to look at things from a proactive standpoint, I think it’s worth doing a, an assessment of who you are in the market and what’s going on and how you’re engaging, because there are landmines that if you do that intentionally, there are landmines or potential pitfalls that you can identify proactively that you can start putting some lane lines around the saying, here’s how we’re going to talk about here. Here’s the things we’re not going to say. And if you do that proactively, you’re much less likely to step on a mine. Part of the challenge that is happening, I know for me personally, in the context of this redefinition is I have some well-worn paths. I go down and just in figures of speech that I use that are colloquial, that are, have been longterm accepted that are seen very differently now than when I first adopted them. And I’ve got to be careful, same thing is true for how companies are typically addressing market. You gotta just, you gotta look at those things and, and come at it from a challenger perspective and say, okay, what are the, what are the hot buttons? What are the things that we need to be aware of that could be bell ringers and, and look at your organization. You have people in your organization that are extra sensitive that are particularly attuned for whatever reason that is because of the worldview they come from because of the, the, the, you know, however many factors contribute to who they are that make them a little more sensitive and a little more aware.
John Farkas (19:37): And, and, you know, and most organizations will self identify. You may have a department in your organization that has that. That’s a great conversation to have to initiate and say, okay, we are looking at doing a proactive set of work here to help us ensure that we are going to appropriately frame our marketing efforts and avoid any of the issues that could be. You’re not going to avoid everyone. There’s a lot of issues, but you can avoid a lot of them with some proactive measures. And so I would say the best defense is a good offense in this say, take it, take it proactively, say, how can we, how can we reframe some things and come up with a guide that says, here’s what we’re going to talk about. Here’s what we’re going to avoid. Here’s what we’ve done before that we want to just be, to take a little turn away from or refactor this way. I think that that’s, that’s going to be an important initiative for a lot of, a lot of organizations that’ll help avoid some of those things that Jeff was talking about.
Angus Nelson (20:37): So there are some companies that had take a strategy on marketing that would link themselves to a movement of some sort. And there’s always a choice that people make that as you choose to go one side, the other side’s going to come against you, but it is a strong marketing differentiator. When you can say, we’re, you know, this is what we believe as a company. And what’s that tension of doing something, knowing that it may not reflect well to some people, but at least they know who, what you stand for versus those that do nothing and don’t stand for anything. And so therefore nobody cares.
John Farkas (21:15): Yeah. It comes back to brand, right? I mean, what we’re talking about is what, what’s the soul, what’s the heartbeat. And I think that, that if you have an initiative that’s authentic to who you are as an organization, if you, or a stance or a, a viewpoint that, that you’re wanting to bring forward. Um, I mean, let’s look at, uh, you know, a great consumer brand that does a great job of this as Patagonia. I mean, my goodness, you know, where they stand on some things, especially as it concerns the earth, right? And they’ve been very forthright about it. They’ve said a lot of things that offend some people, and let’s just say, they’re not struggling. They’re not having a problem. Um, they’re, they’re in a period of wild expansion that parallels their assertions. They’ve made about how they see things. I think that that’s, and that’s the power of brand.
John Farkas (22:06): You might offend some people, you might have people look at you sideways and go, well, I don’t share that sensibility or that sensitivity is probably a better way to frame it. I’m, I’m willing to, I’m willing to have that conversation and say, if we, if, if what we’re bringing forward, if what we’re saying is true to who we are, that’s going to be an authentic expression of brand that I think will reflect favorably. Overall.
Mark Whitlock (22:31): You’ve been listening to an interview recorded at the end of 2019, and some commentary recorded at the beginning of 2020 from Jeff Cornwall professor at Belmont university and the CEO of entrepreneurial mind, as well as commentary from John Farkas. What you are about to hear is John’s response to what have you learned about marketing through the pandemic? When we first saw this happen, and there was just tremendous gasp across the market, lots of pause buttons were hit.
John Farkas (23:07):Lots of uncertainty, trade shows were canceled. Things moved into different frameworks and out of necessity. And what we’re seeing happen is a remarkably fast, remarkably agile adaptation, across many of these business sectors. Of course, there are sectors that are deeply influenced, deeply impacted that don’t have an easy path forward, no matter what, but I’ve been impressed with the speed and agility of the change that I’ve seen take place. And the effectiveness that is continuing to manifest as a result. What that’s shown me is that we have an opportunity in, in this digital world that we live in four very quick strategic opportunities to be seized in ways that we, we can’t yet imagine that we would do well to push toward and create because we’re seeing it happen right now. We’re seeing acceptance of some new and different ways in a very short timeframe. We’ve never been more conditioned for change than we are at this moment. And what that means is we can look to and take advantage of new opportunities and help people into new ways, because they are used to new. They are used to seeing new ways technology is making that possible. So I think that’s an opportunity. It’s an opportunity for creativity. It’s an opportunity for innovation and it’s going to require courage. But I definitely think that this is a season to help people think in ways they haven’t thought before.
Mark Whitlock (24:55): Thanks for listening to this edition of Studio CMO. We’ve linked to many resources on our show notes page. So go to studiocmo.com/020 that’s studiocmo.com/020, and link out to resources about the soul of a brand and about crisis PR communication and more. Thanks for listening and always remember to understand your buyer’s problems lead out of that empathetic understanding, and always, always make your buyer the hero. On behalf of Angus Nelson, and the host of studio CMO, John Farkas. See you next time on Studio CMO.