The Three Marketing Mistakes of Kevin Rudd: Lessons for Leaders

June 2010
Written by Neil Dwyer

Summary

Kevin Rudd’s political ascension and demise are now a matter of history.  This article reviews the three greatest marketing mistakes that led to his downfall.

Mistake 1:
He sold a vision and then failed to live up to it

Mistake 2:
He failed to sell the metrics of the mining tax

Mistake 3:
He failed to understand his markets: the Electorate and Labor Party

Auspicious Beginnings

My fellow Director Stephen Johnson and I first met Kevin Rudd when he was Shadow Foreign Minister.

We invited him to open a new warehouse facility for the Australian subsidiary of German industrial powerhouse Wampfler AG and he kindly accepted then proceeded to dominate proceedings in just the way that one would want a senior politician to perform.  He spoke fluently on the topic of international trade and bilateral relations. He commanded the attention of all in the room.  Our client loved it.

That was 2003.  Even then it was clear that of all the personalities in Labor’s shadow cabinet, he was the one most likely to best John Howard.  He was younger than Howard yet not too young, he knew how to pose for the camera, he was an excellent orator and importantly he looked more like a Liberal than many on Howard’s front bench which proved a key election-winning advantage. 

The arc of his ascendancy to stratospheric popularity and light speed fall from grace last week surely has to be viewed by any student of politics from this day on as mandatory instruction.

But when recast as marketing errors, leaders at all levels can learn from his three greatest mistakes.  They apply equally in the boardroom and on the street.

Mistake 1. He sold a vision and then failed to live up to it

Remember the television commercials introducing Kevin Rudd to the nation?  He spoke directly through the lens to everyday Australians and he sounded more like a trusted advisor than someone who seeking power.  You felt you might, just might, be able to trust a politician for once.

Remember his televised debates with John Howard?  It could be argued that the people twisting the dials that feed the Channel 9 “worm” with information were simply anti-Howard, but there was no denying the nation’s thirst for what Rudd was saying he could deliver.  Everything he said sounded statesman-like and somehow bigger than John Howard’s vision on the same topics.  Australia has always wanted to punch above its weight and he was saying it was possible to have it all. 

He sold himself as a leader who could deliver positive change while keeping an eye on the government’s wallet.  Big, big promises were made.

It worked to get him elected but then he needed to ensure that he delivered on the promises he made.  And he couldn’t. 

Along the way the country took part in the greatest economic meltdown since the Great Depression and for the most part the everyday Australian has emerged unscathed but the public is an unforgiving market and many an opinion poll began to reflect discontent with his ability to deliver on the other elements of what he had promised. 

He became known more for talk than action and that was the beginning of the end.

He delivered an “Education Revolution” that has been cast as a massive waste of taxpayer dollars, a computer for every schoolchild that hasn’t been delivered, Carbon Trading on hold until 2013 at the earliest, Home Insulation which now requires $50 million set aside for checking it’s actually safe, Antarctic Whaling still going on unabated, Public Health in limbo between state and federal control, Asylum Seekers on the rise, Fuel Watch dead and buried next to GroceryWatch and British-style control over the Internet usage of all Australians without their explicit consent.

In 2007, in pure marketing terms, his personal brand outsold John Howard’s at the polls but when the buyers (voters) got to experience what they bought, they were left unsatisfied.  He didn’t live up to the vision and his popularity with voters was heading further south each month.  Without change, the Labor powerbrokers knew that the electorate would punish the party at the next poll.

The lesson: Don’t overpromise on the first purchase.  Remember that your product, service or company’s Unique Selling Proposition is the key to converting prospects into customers, but they’ll only buy a second time if the product meets or exceeds their expectations.  In the long run, all you’ll create is a short-term win and long-term brand opponents.

If you need to promise big to win the sale, you must do so knowing that you can create the machinery to fulfill demand and meet the expectations of your market.

Mistake 2. He failed to sell the metrics of the mining tax

The tipping point was reached when Kevin’s Labor party powerbrokers decided they would lose too much support in critical regional seats reliant on mining revenue under the proposed Resources Super Profits Tax.

I like to think that I consume as much news media as the average Australian if not slightly more.  Yet all I have heard about this tax is the initial budget declaration from Wayne Swan, some post-budget analysis and a massive barrage of mining company-sponsored announcements and advertising predicting job losses, project re-evaluations and deferrals of work that have painted it as a terrible piece of legislation.

Not a peep out of the government except to attract more criticism for committing $38 million to an advertising campaign.  And the ads that came from that spend were terrible for their failure to sell anything at all.  A no-name guy stands in front of a projector and waxes soporific about how Australia needs tax reform and how the mining tax is just a part of the equation.  Nothing about what it means for hospitals, roads, tax cuts or the deferral of increases.  Nothing that translates the big scary monster painted by the mining companies into everyday things that ordinary Australians want and need.

Kevin Rudd’s mistake was to fail to explain how this was good policy in terms that his “working families” could understand – dollars on the table.  He and his ministers should have been taking every media opportunity to talk about the specific benefits the tax would bring to everyday Australians. 

It took an official from the International Monetary Fund to declare that it was a good idea, but it came a bit late.  Only the day before Kevin Rudd was rolled, the IMF’s deputy head of tax policy, Philip Daniel, said this:

"It offers strengthening of Australian public finances over the long term, reduces risk of absolute loss for investors, while leaving a substantial share of resource profits in private hands."

Where were Kevin Rudd and his team through this whole saga?  It seemed to me they had no response, hadn’t anticipated such coordinated opposition to the tax proposal and were stunned into inaction.

Ken Henry, the Secretary of the Treasury and his substantial staff had surely prepared models showing forecast revenue and expected impact on demand and ore/mineral price levels from the tax.  Why didn’t we see them?  We’ll never know.

What we do know is that in the absence of a compelling argument from the government, public opinion marched alongside the miners and Kevin Rudd was hoist upon his own petard, uncharacteristically lost for words.

The lesson: Specificity sells.  Translate features into benefits and be specific about them.  Couple this tactic with repetition at every opportunity and you will outsell any competitor using more general advertising, every time.

Mistake 3. He failed to understand his markets: the Electorate and Labor Party

Who could believe it when Peter Garrett admitted that he only found out about the government’s decision to back down on the introduction of an Emissions Trading Scheme for Carbon when he read the morning paper?  He was after all the Minister for the Environment!

That episode appeared symptomatic of the style in which Kevin Rudd was running the country.  No broad consultation of interest groups or the party on major issues.  Decisions made in private then dictated to MP’s to sell. Sometimes, key figures and ministers bypassed altogether as the PM held a media conference to hit the 6pm news slot.

And that mistake, above all the others, is what saw him become the first ever prime minister to be dumped in his first term of office, still leading the opinion polls over his rival Abbott.

If he had trusted and relied more on those around him, and brought them along with him in policy development, he would have had advocates and a committed team who could then sell to the voters in their electorates with a consistent message. 

Instead, he should have thrown a Toga party, because he got the same treatment as Julius Caesar.

The lesson: Recognise that you have multiple markets and you’ve got to have a plan for tackling each one of them.  The first market you need to sell to works within the walls of your office or factory.  If they don’t believe in what you’re selling and don’t feel included or valued, they’ll sabotage their own performance, either unconsciously or consciously and ultimately you’ll pay the price.

Dumped: Kevin Rudd

"It worked to get him elected but then
he needed to ensure that he delivered on the  
promises he made. And he couldn't" 

"He became known more for talk
than action and that was the
beginning of the end"

"Kevin Rudd’s mistake was to fail to explain
how this was good policy in terms that
his “working families” could understand –
dollars on the table" 

"If you need to promise big to win the sale,
you must do so knowing that you can
create the machinery to fulfill demand and
meet the  expectations of your market."

"He should have thrown a Toga party,
because he got the same treatment
as Julius Caesar"