cover story OVERNIGHT SUCCESS INSIDE THE GRASSROOTS PILOT PROGRAM THAT’S EARNING FEDEX ITS GEN Y WINGS BY JESSICA HEASLEY

THE FEDEX SPONSORSHIP MARKETING TEAM: (from left to right) Zack Cowell, Marketing Principal; Kevin Demsky, Director; Angela Johnson, Sr. Marketing Specialist; Clare Treanor, Marketing Specialist Advisor (back row); Karen McConnell, Manager’s Assistant (front row); Katherine Flee, Manager; Nancy Altenburg, Manager (front row); Jacqueline Bailey, Marketing Specialist Advisor; Zack Amin, Manager; Emily Brooksbank, Director’s Assistant; Kirsten Brasfield, Marketing Specialist Advisor; Jourdan Steinberg, Sr. Marketing Specialist; Beth Pope, Marketing Specialist Advisor; Jacque Bailey, Marketing Specialist Advisor; Tim Kelly, Marketing Specialist Advisor (back row); Rick Robinson, Marketing Specialist Advisor; Leslie Thompson, Marketing Specialist Advisor; Seth Fishbein, Marketing Specialist Advisor; Jeremy Miller, Marketing Specialist Advisor.

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WHEN IT COMES to brand name recognition, it’s tough to compete with the “verbs.” Like Google, the search engine that became so synony - mous with surfing the web that the Oxford English Dictionary made the company’s name a bonafide verb in 2006. Or Kleenex, that ubiquitous tissue brand that we all grab for when 14 jets and service to 25 cities has since grown to become a $39 bil - we have a cold. And of course the list goes on to include popular lion company with more than 290,000 employees. Today, FedEx products like Xerox, Tivo, Saran Wrap, Frisbee, Q-Tip and Post-It the marketer is a savvy and well-established player, too, with firm notes, to name just a few. Thanks to a serendipitous confluence of footing in the world of high-level sports sponsorships, including timing, innovative offerings and a groundswell of mass adoption, an official marketing partnership with the NFL, a relationship these products and services have become eponymous with the with the PGA Tour as the season-long title sponsor of the FedEx - entire genre they inhabit, going from a mere name on their label Cup, a NASCAR partnership with Joe Gibbs Racing that includes to a word used in everyday language. the #11 FedEx Toyota driven by Denny Hamlin, and high-visibil - Federal Express has enjoyed this kind of name recognition, too. ity naming rights deals that include FedEx Field, the home of the As the first shipper to offer guaranteed express delivery beginning Washington Redskins, and the FedExForum in Memphis, the in the mid 1970’s, the FedEx brand name quickly became the verb home of the Memphis Grizzlies. The brand leverages each of these of choice used to describe the act of sending a package overnight. large-scale investments as a year-round hospitality platform where Indeed, anyone with a few years under their belt in business has its sales teams can build relationships with b-to-b clients across its probably “FedExed” their share of “Xeroxes” to clients or col - portfolio (Team Epic, Norwalk, CT, handles sponsorship activa - leagues over the years. tions). But even with an enviable level of name recognition and noto - “When we activate our sponsorship investments, hospitality is riety that most brands can only dream about, the brand in recent certainly a very key tactic, a very key way that we leverage that years has recognized that its verb status needs some care and feed - investment,” Demsky says. “It’s a very powerful way for us to devel - ing if it’s going to stay relevant to a younger generation, especially op business.” those prospective customers that Google, Facebook and Tweet on Despite its success, company research revealed that FedEx a regular basis, and are coming up through the ranks and into wasn’t making the kind of inroads it needed with the Gen Y decision-making positions at a rapid pace. market—an influential segment with a sophisticated set of needs, So early last year, the company best known in marketing circles behaviors and expectations. “The next generation of decision- for its longtime sports sponsorships and stadium naming rights makers and the next generation of small business owners deals tried something completely new—a grassroots pilot pro - consume information, they consume media and they consume gram that spoke directly to an emerging generation of Gen Y marketing messages in a different way than customers have in the small business owners that are fueling local economies and repre - past,” Demsky says. “We’ve always had a good relationship and a sent untapped revenue opportunities for the FedEx and FedEx solid product offering for small businesses. But we wanted to Office brands. make certain that as these younger small business owners are The resulting program skipped the jumbo jet-sized sponsor - beginning to formulate loyalty and they’re beginning to make ship and advertising budgets and instead combined live and decisions about who they would like to align with, that we under - online community cultivation with face-to-face networking expe - stand that customer segment, and that we understand these indi - riences and consumer-generated events to create a vibrant hub for viduals and how they prefer to form business relationships.” small business owners that previously hadn’t existed—a platform FedEx also recognized that its FedEx Office offering (those for - fully funded and brought to the community by FedEx. mer Kinko’s printing and shipping retail outlets usually filled to “We wanted to establish FedEx as a trusted business partner capacity with a frenzied collection of students, job hunters and with this new generation of small business owners,” says Kevin local entrepreneurs) was very much a b-to-c play, versus the hos - Demsky, the brand’s director of sponsorship marketing. “We want pitality efforts it was activating in its b-to-b portfolio. Small busi - to be able to communicate to them and show them that FedEx is ness owners are just as much consumers as they are companies, a part of their community, we can help their businesses grow, and often employing less than six employees. The brand had to perhaps most importantly, we want to hear their story and be able embrace the idea that personifying itself on a much smaller scale to share it with other small businesses within the community that might more effectively deepen and enhance its relationship with they live in.” And hopefully create a halo around the FedEx brand its prospective FedEx Office customers. in the process. New York City-based experiential marketing agency MKTG We drop our landing gear and take you to Austin, Texas, and INC was tapped to help FedEx strategize a plan of attack based on inside the FedEx + Me pilot program. a thorough review of pain points, challenges and “need states” unique to small business owners around the country. These need NEED STATES AND LONELY HEARTS states include a desire for networking and connections with fellow FedEx was once a small business itself. Founded in 1971 in Little business owners, access to experts that can help grow their busi - Rock, AR, the now Memphis-based shipper that started with just ness and products and services that can help them manage their

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back office operations easily and affordably. A sense TEXAS TOAST: (left) Motivational speaker of camaraderie was also at the top of the list of Thom Singer gets the crowd pumped up; (below) FedEx + Me member Ellie Scarborough needs—many small business owners describe their introduces herself with the help of community experiences as being very isolating and lonely. liaison Nancy Shields; (bottom) FedEx senior- vp corporate marketing Laurie Tucker prepares Part two of the process involved developing a plan to award a $5,000 grant. to match each need state with FedEx’s offerings. “We had a good idea of what this consumer was looking for in establishing and curating a relationship with a brand,” says Charlie Horsey, MKTG INC’s president and ceo. “It was a lot less about how creative we could get with the message. It was more about demonstrating and articulating what the need states are that we think the brand’s goods or services can meet.” Marketers often develop messages and campaigns behind closed doors and then push them out to con - sumers. By recognizing the unique needs of the Gen Y small business owner as its starting point, FedEx did just the opposite, and FedEx + Me was born. “At its core, this program is about building a community and bringing together small business people in the Austin marketplace and connecting them,” Demsky says. “I think the brand attributes that we want to communicate to the general marketplace are very relevant for this younger generation of small business owners, so this wasn’t necessarily a brand play for us. We have a very strong, very respected brand. We just want to make certain that we’re con - necting with these people on a much more human level—on a much more local level.”

A COMMUNITY COMES ALIVE The brand selected Austin as its pilot market because “it is the quintessential city for Gen Y entrepreneurs,” Demsky says. “It’s a very thriving, progressive, dynamic city and we felt like that would be a terrific place for us to be able to reach out and begin this program.” clients and social circles to vote (a Face - To make that local connection, FedEx hired a book API on the backend required the full-time community liaison named Nancy Shields voter to be signed into their Facebook who was charged with tapping into all of her con - account to submit their vote), and over the nections, both live and online, to begin driving course of the three-month pilot and after Austin-area small business owners to the FedEx + two rounds of voting, the community ulti - Me program microsite, mystoryaustin.com. She mately selected a group of 15 finalists from kicked off her efforts in January 2011 with out - which the five winners were chosen. The reach to touch points that included the local cham - five winners from each round nominated ber of commerce, groups at the University of Texas five more businesses for the next round, and Bootstrap Austin, a popular website for local which kept the word-of-mouth humming entrepreneurs. Shields also began populating the along between phases. The end of the pro - program’s Facebook (facebook.com/mysto - gram culminated in the selection of one ryaustin) and Twitter (@mystoryaustin) pages to winner (FedEx picked this time) who raise awareness for the program. received a small business grant worth At the mystoryaustin.com microsite, small busi - $5,000. ness owners were invited to join the online community by setting All visitors to the website could learn more about the program, up a profile page for their business. Everyone who set up a profile view profiles and videos of all the small business owners taking was eligible to enter an online contest that offered five small busi - part, follow along or post on a blog that’s continually updated with ness owners a professionally shot promotional video that high - new content cultivated just for the community, and check the lighted their business—a high-value item that mapped back to online event calendar for upcoming events. The FedEx + Me web need state research and something they probably couldn’t afford team populates the site and calendar with a mix of local events and otherwise. The community voted and campaigned their friends, content that would benefit the members, and also promotes

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FedEx sponsored events. All of the digital ele - ments helped drive atten - dance and interest in the program’s three brand- sponsored live events. The first, on March 10, was a networking event designed to introduce small business owners to one another. Its theme was “How to Build a Team from Scratch” and featured motivational speaker Thom Singer who warmed up the crowd with BUILDING BUSINESS: (above) Nancy upbeat networking exercises before the evening’s keynote Shields awards FedEx + Me participant speaker, Mario Mendias of My Fit Foods, shared his insights Mark Phillip with a raffle prize; Participant Ben Weatherman (above/right) gets and expertise on being a small business owner. The event was involved in the Q&A; (below/right) Speaker held at Shields Legislative Associates, a local lobbying firm. Kevin Carroll inspires the crowd; (far right) The second event, “Social Media: Beyond the Basics,” took Program members connect at the awards place on April 7 and featured a panel of local social media bash step and repeat. experts that included Ricardo Guerrero, Aaron DeLucia and Francesca Gangitano. Thom Singer once again got things going by soliciting feedback from attendees on what the panel would discuss and Bobby Jenkins, president of the Greater Austin Chamber of Commerce, provided a motiva - tional speech. Attendees had the opportunity to ask questions and get one-on-one time to chat about their specific chal - lenges. Local small business Max’s Wine Dive played host to the soiree. Small business owner Maria Orozova, president and cre - ative director of marketing and design firm The Mod Studio, and FedEx + Me member, says the SEO optimization discus - sion was so useful and inspiring she “literally went home and implemented it.” the video contest winners for each round of voting, promotions The third and final event of the pilot program, called “The My for community-generated meet-ups and plugs for smaller lunch Story: Austin Awards Bash,” was held on May 17 at The Highball, events that took place between the bigger events. FedEx all along a local bar and bowling alley. This event was more inspirational in had strategized that the program would eventually take on a life of tone and featured author Kevin Carroll as the keynote speaker and its own and become a conduit for community interaction. With a video presentation featuring highlights from the FedEx + Me, the microsite as the hub for information sharing, the community My Story: Austin program. FedEx’s senior vp-corporate market - indeed began planning and hosting its own events. For instance, ing Laurie Tucker was on hand to award the $5,000 small business after the pilot had officially wrapped, the website featured infor - grant to the winning business owners at the event. Tucker and mation about “Mentor Month” in December, a series of commu - Demsky met individually with several Austin-area small business nity-managed events hosted by small business owners at their owners before the final event to learn more about their work and shops and offices. their challenges. Tucker even sported a pair of jeans she purchased “It’s not always about entertaining, like at a concert or a sport - from one local business on awards night. ing event,” says Horsey. “Sometimes it’s just merely about setting “The live events are absolutely critical and really are the back - the stage, and really calling out the products, goods or services. It’s bone to the overall strategy,” says Demsky. “It became apparent to about enablement.” us that networking and knowledge sharing are perhaps two of the The brand reports that there were plenty of light bulbs going off most important things that small business owners would like to be between attendees at each of the events. One local cupcake baker, able to participate in, and these live events give them an opportu - for instance, bumped into a local coffee distributor at the first live nity to come together and form those relationships, have those event in April and made a connection—and forged a future col - conversations and make those connections.” laboration—she might not have made otherwise. The Mod Stu - Throughout the program, the brand made sure to sprinkle its dio’s Orozova says she made valuable connections through the microsite and social media pages with energy points that would program, including several she can map back to her bottom line. keep the momentum going. These included announcements for “I’ve found it really helpful for my business,” she says, noting

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three key pieces of information: can the brand change behavior (i.e. are consumers using FedEx’s products and services?); has their perception of the brand changed because of their involve - ment with the program; and, is FedEx + Me an effective platform for continuing communication with small business owners. Dem - sky is happy to report that there are positive gains across all three and that the program was revived again in October for another run, this time with more grants totaling $30,000 up for grabs. “We do feel that overall the program has been successful and is helping us understand and learn and refine our ability to form relationships with these customers,” he says. “We’re into our sec - ond year and still kind of learning, we’re in phase two. And we’re excited about what the future will hold for the program.” For a brand used to measurement in terms of large-scale spon - sorship KPIs and known ROI factors like post-event sales data, Demsky admits that slow, small-scale organic growth can feel a bit risky. “I think it’s certainly different for us,” he says. He warns that with small test programs, you have to be very careful and very dili - gent about communicating the program benefits to other stake - holders within the company. And you have to remind them that the results are not necessarily going to be evident very quickly. “You have to have patience and you have to have a little bit of faith that you’ll eventually be able to figure out the best way to utilize this program as an even more effective marketing tool,” he says. And you have to be open to feedback. One of the biggest bene - fits of a small, geographically targeted event program is the oppor - tunity to gather candid insights from the customer base. FedEx says that it’s received a few eye-openers from the Austin pro - gram—mainly that it needs to do a better job of making its FedEx Office locations more visible to small business owners. “It’s been both refreshing and fun on one hand, and also very enlightening for us to better understand how we can market our that she has been hired by several fellow program members for products and services to our customers,” says Demsky. “You have paying gigs like website redesigns and brand audits. She has also to treat it as a test and go into it with a mindset that you want to struck up several new partnerships with other small businesses, learn, you want to understand, you want to refine your planning exchanging services with one another to keep costs low. “There and make improvements as you move along.” has been constant outreach on what [FedEx] can do to help us and With a budget he characterizes as a “moderate marketing to help the businesses locally,” she says. “That’s been really good for investment,” Demsky is confident that FedEx + Me is poised for us. We made a lot of connections.” growth. With about 100 members, the Austin program has moved The brand also made sure to continue fostering that Austin into phase two and the company is currently considering expan - entrepreneurial spirit of paying it forward by hosting and catering sion into other markets. It all maps back to the brand’s overarch - its events with the products and services made by its local small ing, three-tiered marketing objectives, proving that executing on a business owners who take part in the FedEx + Me community. small-scale can sometimes yield big picture, long-term wins. The brand rounded out its program offerings with a lifetime “We first want to reach, then we want to teach and then we want discount for FedEx + Me members, taking its in-store services a to inspire,” Demsky says. “Phase one of the program has been all step further by making one-on-one connections between FedEx about building participation, building the community. And that’s shipping experts and local entrepreneurs with unique challenges, the reach part of the strategy. As we step into the second phase, like one business owner struggling to get her refrigerated cake we’re still continuing to recruit and reach and bring people into balls shipped internationally without melting along the way. the program, but this year we made a much more concerted effort Did any of it affect Orozova’s impression of FedEx? While the on teaching: What sorts of value, what sorts of knowledge, what program was moving her sales needle, did it move the needle on sorts of information can we bring to the folks in the program that the program’s effectiveness? “I know the FedEx story and that it really makes the overall value of the FedEx + Me program impor - was a small business once, too,” she says. “I feel like they’re giving tant to them. As we go into future phases, we’ll really focus on back to those roots.” inspiring these small business owners: What can we do to take the program to the next level? What can we do more dramatically to A PILOT PROGRAM TAKES OFF help them take their businesses to the next level?” FedEx went into the pilot program hoping to get a better gauge on And keep them “FedExing” in the years to come. EM

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