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Newsletter: The Elephant in the Room

Mar 1, 2010 5:39:00 AM / by Tim McCarthy

Until we acknowledge an issue that is getting in our way, in business as well as in life, there is no chance we will overcome that issue. [more]

When my brother, Terry, sent me an article reporting that Domino’s Pizza’s “taste challenge” campaign appears to be paying off, my reaction was that they’d finally talked about the elephant in their room. And that’s the learning to share with you today.

For those who haven’t seen their advertising campaign, Domino’s is saying “we heard you – our pizza doesn’t taste good – so we’re fixing it.” And then they offer a money back guarantee to try their new recipe and, if you don’t like it, it’s free.

To me, this is not an act of genius. It is finally acknowledging the elephant that’s been in their room for quite some time. Some forty years ago at Ohio State, our code for ordering pizza from Domino’s was “let’s get some cardboard.”

Domino’s did not build their multi-billion dollar brand on a guarantee of taste. They built it on a guarantee of the speed of delivery. In other words, we didn’t order Domino’s pizza because we liked it, we ordered it because we were hungry and we knew it would get there in thirty minutes or less.

Wikipedia says the elephant in the room is “an English idiom for an obvious truth that is being ignored or goes unaddressed. The idiomatic expression also applies to an obvious problem no one wants to discuss. It is based on the idea that an elephant in a room would be impossible to overlook; thus, people in the room who pretend the elephant is not there might be concerning themselves with relatively small and even irrelevant matters, compared to the looming big one.”

Serving bad pizza fast worked for Domino’s for forty years and the first few billion in sales. But apparently, someone finally recognized that it might be a good investment to deliver pizza fast AND good.

Once Domino’s acknowledged their elephant, they created a new recipe, spoke about their problem in the media and invited us to see if they’d solved it. And as long as the reality of their pizza’s taste confirms their claims (I haven’t tried it yet), this campaign will succeed mightily and for obvious reasons.

So, why did this thought take forty years to develop?

Let’s pretend for a moment we are at a marketing meeting at Domino’s sometime over the last four decades. The discussion probably sounded something like this:

New guy: “The research seems to be saying that people don’t like our pizza.”

Guy in charge: “Yes, but notice our taste ratings have been improving. Mary, are we set for the television shoot next week?”

New guy: “Wait a minute, only 35% of our own customers like our taste while our competitors’ ratings are all over 90%.”

Guy in charge: “Yes, but like I said, we’re doing better. Joe, let’s discuss the Buy One Get One Free promotion.”

And over time, the new guy gets used to ignoring Domino’s elephant and becomes the guy in charge.

I have several elephants in my personal and business rooms. The most recent that I’ve been working to face is that our foundation has operated for 12 years without a formal business plan.

Get this: I coach people every day to create disciplined business plans and follow them, and yet I’ve allowed us to operate without a plan. How did our meetings (see above) sound as I distracted myself and our board from looking at our own elephant?

I don’t care to remember.

But now, finally, I’m four months into acknowledging my elephant and we are drafting, editing, discussing and modifying a foundation business plan. And I’m feeling a lot better.

I’m going to watch now to see if Domino’s stays with their strategy. I’m also going to watch (what I consider) the latest corporate elephant, Toyota’s accelerators, and see if Toyota decides to eventually face it.

So far, I’m not hopeful for them. Their chairman appears to be in denial. The television advertising I’ve seen admits nothing and tries to remind me of their wonderful reputation. And yet on the front page today I read about a new accelerator problem.

American consumers are uniquely forgiving, but only if the offender acknowledges the elephant in the room.

One of the most famous corporate elephants in history happened to Tylenol in 1982. Some Tylenol capsules were removed from drug store shelves and injected with cyanide which resulted in seven deaths in Illinois.

Tylenol (Johnson & Johnson) management, despite this incident being isolated and no fault of theirs, recalled all products, discontinued producing capsules and created “tamper-proof” packaging.

Their market share before the incident was 37%; during the incident it declined to 7%; a year after they openly faced their elephant and made these changes their market share was over 50%.

The incident proves that American consumers not only forgive, we reward honesty and responsiveness.

But you have to face the elephant in the room before we do.

Tags: Newsletter, Planning, Brand, Marketing

Tim McCarthy

Written by Tim McCarthy

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