A Taste of Frankenmuth

Peter Hayashida

Lynn Maikke

Marketing 642 / Fall 2003

Michigan’s Little Bavaria

• Heritage as a 19th century Bavarian Lutheran missionary settlement A sense of cultural cohesion and work ethicA theme for reinventing the town

• From a predominantly farming community• To a thriving, ambitious tourist destination

• In 1959 the interstate highway was built only miles away Threatened the profitable traffic flow along main streetFrankenmuth responded with city beautification

projects

No Visitor Leaves Unhappy

• 1989 marketing study commissioned by the Chamber of Commerce Tourists gave the highest marks to town safety and

cleanlinessVisitors liked best Frankenmuth’s warm and friendly

atmosphereRecommendations from friends, relatives, and co-

workers made up the largest reported information source• Good word-of-mouth is important

Word-of-Mouth Referral

• Word-of-mouth may be the best advertising Low cost and highly credibleThe only promotion method of consumers, by

consumers, and for consumers• Does it matter what people are saying, as long as it

is positive? Know the content of reputation

• Tailor paid advertising to reinforce and complement• Give customers new information to shape what they say• Find dissatisfied customers and turn dissatisfaction into

gratitude

Consumer Control

Marketer How much...

... and where?

... will allow you to spend less time, money, and energy promoting your organization .

                                   

Letting your customers do the talking about your reputation...

Frankenmuth 2000

• $20M investment program to stimulate growthMajor infrastructure improvementsMarketing programs focused on capturing the value of

word-of-mouth• Find “champion” customers through market research• Complete a testimonial program utilizing metaphors• Implement a referral program

Develop “champion” employees• Training courses in word-of-mouth marketing• Identify and remedy dissatisfaction

Join the rest of the world on the Internet

                

  

Shared Tastes & Values

• How does Frankenmuth ensure that satisfied customers can make referrals to others who share their taste and values?– Make values clear

• Tradition (“loyal for generations”)– Never changes

• Safety, cleanliness• Superb customer service

– Emphasizes connection between businesses & consumers • Turn visitors into “ambassadors for the community”

Maximize Referrals

• Remember: no visitor leaves unhappy!– Satisfaction guaranteed

• Empower employees to resolve customer concerns without going up the management hierarchy

• Make customers’ visits memorable and unique - visitors who return home will have stories to tell that will be unusual, special and distinctive – Glockenspiel at the Bavarian Inn– World’s largest Christmas Store

• Educate customers about the product to make them more effective ambassadors

                                                    

Prospect Conversion

• Q: Is the business trying to raise the likelihood that those who hear about the service and share the value system of those who recommend it will actually become customers?

• A: Yes and No

Targeted Messaging• Geared toward a particular demographic, which

makes the messages clearer and more consistent– Frankenmuth is geared toward multigenerational family

units, with a white matriarch decision maker in her 40s; average annual family income exceeding $40,000, live within 100 miles (or two hours) from Frankenmuth• “Champion” customer

– Activities designed around this profile:• Family-friendly, warm, welcoming attitude• Value for the money• No-nonsense approach to customer satisfaction

– Families visibly running businesses conveys a shared value system with Frankenmuth’s typical customers

Will They Come?

• “Everyone who gets mad tells ten people, but if they’re happy they tell three.”

• The best defense is a good offense: minimize nightmare customer service experiences and people won’t complain to their friends– Negative word-of-mouth likely to be shared more than

three times as often as positive– Flood the potential market with good anecdotes that are

healthy for business

              

                          

Can More Be Done?

• Referral reward program described earlier– Give visitors a tangible incentive to encourage

friends and family to visit Frankenmuth

• Stimulate referrals subtly– Say “Bring a friend the next time you visit

Frankenmuth” instead of “Come back next time you’re in Frankenmuth,” (owner of the Frankenmuth Woolen Mill)

Questions/Discussion