Category Archives: marketing strategy

Judging a book by its cover

VIVA storeAs we near the Holidays, marketers look around to see what products are flying of the shelves, and why.  Since retailing is primarily a visual medium, the right packaging is critical.

But louder is not necessarily better.  Today, many of our clients are opting for more understated options, a more elegant, minimalized aesthetic.  Some are going all-green to make a statement to their core customers.  Others are making distinctive statements of their mission and purpose, and even where the profits go, right there on the label.

In short, packaging IS reality today,  and a make-or-break proposition whether you remain on the shelves or get delisted.

Importantly, due to Smartphone use in-store, it allows you to communicate personally with your customer in a way you never did before

Dilip Daswani, an industry expert, lends some words of wisdom:

“A few years ago a buyer in a retail setting would browse a few products on the shelf, make a quick decision to narrow down choices based on the packaging, pick it up, observe the packaging for what it was able to convey and then decide whether to finalize the purchase or not.

More recently, the scenario is somewhat different. The consumers you find in retail outlets today are armed with a smartphone. They’re talking to someone as they shop, looking up search queries, snapping and sharing photos of products with their friends, reading product reviews and running price comparisons.  They are digitally connected, have access to massive amounts of information at their fingertips and make their decisions based on the information they have access to.”

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Positive disruptors

This week, the National Retail Federation Foundation announced 25 individuals selected for honors,  “representing power players, disruptors, givers, influencers and dreamers who are changing the face of retail – many doing so behind the scenes.” (You can read about them on the link below this post)

For now we want to focus on one descriptor listed above: DISRUPTORS.  More than the others listed, this says what marketers should be all about.  Let the players manipulate, the givers hug, the dreamers doodle, and the influencers network, but if marketers are not shaking things up they are not worth their salt.

You know you were born to be a Disruptor when as a kid your parents received notes from the teacher, reporting:  “An eternal chatterbox”, or “Fidgets and flirts non-stop”, or better:  “Has an answer to everything, sometimes the right one.”  In short, a pain-in-the-ass student.

Now that we are all grown up, the NRF calls us:  “True originals who rock the boat with ideas so crazy, they just might work. These are the people who make you rethink what you thought you knew…opening you up to new worlds never imagined.”

Wow, take a look, Mom!  Aren’t you glad I didn’t drink the KoolAid??

There’s another word — its polar opposite — we use for a lot of companies :  ENTRENCHERS.  The image is of soldiers in (wet!) dugouts, poised with guns pointing, awaiting orders to jump out into a scenario that might mean certain death.

It’s not just big companies that are guilty of Entrenchment.  Small family companies are often the worst , living in their comfortable world,  digging in, believing all should be done the way it has been done for decades.  Until, one day…

Today we know that Disruptors and Entrenchers are a “match.com” (to quote a respected strategic planner colleague).  They are meant to learn from each other and work together to slaughter those sacred cows (see our post re this) that threaten to kill any business that does not innovate and differentiate.

We give special thanks to the NRF for letting us come out of the classroom closet and take a (shy) bow!

Trends forecast

 

Houdini“I see…no, wait…it’s an ad blocker!”

At the start of the year, our clients typically ask us what we see in the areas of consumer marketing and media…a glance into the crystal ball, as it were.

This past year most of us were focused on enhancing digital outreach. We have seen this area at least double in activity in our campaigns over the past two years, as clients’ desire to customize and measure the impact of their messages grow.  We see no different for the new year.

In short,  “If you ain’t doing it digital, you ain’t doing it right”, as one of our agency creative gurus quipped.  But HOW to keep doing it right is the question.

Rather than reinvent the wheel on this topic we are taking the shameless and easy path, excerpting what “alum/chum” Publicis — the world’s largest ad agency — tells us.  If they don’t know  about this, then no one does.  So, without much ado…

1. Programmatic targeting of content, not just ads.  Programmatic targeting of ads is now very common for brands and advertisers. In 2015, we’ll see a critical mass of publishers begin to leverage behavioral data to programmatically target content to optimize experiences for users on publishers’ sites.  Content will be personalized and specifically aimed at individual consumers on websites and blog pages, similar to the way ads have been targeted until now. Medium-to-large sized publishers will also invest in data management platforms and in-house programmatic resources.

2. Content marketing spend will need to deliver a more measurable ROI impact.  In 2015, we’ll start to see more sophisticated means of measuring the impact of content marketing campaigns, leveraging multi-attribution techniques to understand the downstream impact on conversion caused by these higher-funnel marketing activities. For example, a brand might spend $1 million on a native advertising campaign but not understand to what degree — if any — that investment impacted ROI.

3. A critical mass of merchants will finally optimize their mobile affiliate tracking capabilitiesWhile the browsing experience is now largely optimized for mobile devices, the same cannot be said for tracking of performance campaigns on mobile devices. [In 2015], we can expect to see retailers work continuously to improve conversion tracking and affiliate payouts in order to satisfy the demands of their increasingly mobile publishers.

4. The startup bubble will deflate slightly and result in consolidations of a fragmented adtech startup market.The last few years have seen an avalanche of entrepreneur startup companies, many focusing on the adtech space. While this has resulted in a great deal of innovation — publishers and advertisers have benefited from a wealth of choices for optimizing their ad spend — we’ll start to see this slow down as some of these companies struggle to raise successive rounds of funding.

5. Point solutions will struggle, and clients will shift their desire to want to work with more full-funnel marketing suitesIn a similar vein, some adtech companies offering point solutions will also start to struggle, as an overwhelmed publisher and advertiser community will prefer to work with fewer partners, opting for ad tech companies offering full-funnel marketing suites. This likely will result in further consolidations of the fragmented adtech market, resulting in stronger conglomerates offering their customers a number of key services combined.

6. Publishers will develop sophisticated in-house capabilities for behaviorally programmatic targeting of premium advertising. Historically, publishers have worked with ad networks and other programmatic adtech partners to outsource their programmatic ad targeting. However, in 2014, a number of larger publishers started to bring this capability in-house, and invest in infrastructure to manage their audience data, such as data management platforms.

7. Ad blockers will become as big of a problem in 2015 as “viewability” was in 2014. The increasing technical sophistication of the adtech market and the increasing demands on accountability by advertisers saw ‘viewability’ become a dominant theme in 2014. Technologies that can filter out automated bot traffic and determine if a human truthfully saw an ad are regularly used now despite it reducing impression metrics significantly. This movement will continue in 2015, with attention turned towards ad blocker software.

Ad blockers (in the form of toolbars and browser extensions) have quietly gained popularity by users wanting a faster, ad-free browsing experience. However, a little-known fact about these ad blocker companies is that they monetize by charging ad companies to let their ads bypass the blocking software. While a marginal problem in the early days, the popularity of these ad blockers means that ad revenues for publishers are impacted; on average about 20 percent, though up to 50 percent for publishers with a tech-savvy readership.

In 2015, we will see a variety of solutions emerge on the market, offering various experiences around user-driven personalization of advertising. (Credit:  Publicis Alum Group, via LinkedIn.)

 

 

What the VA could learn from P&G

Delivery issues
Delivery issues

We were first told this in Marketing 101 eons ago, but the message continues to be reinforced by experience after experience:  “If you are a marketer, you can market anything”.  This means you can typically apply the “Four Ps” (positioning, product, price, promotion) to just about any industry without really knowing much about it.

But things can and do get lost in translation, or what we term “cross-overs”.   We have seen the industry crossover work well at Apple and disastrously at  J.C. Penny’s (JCP), and a few others.

It really depends on the industry and the immediate challenge being faced…which brings to mind another axiom, this one by sociologist Abraham Maslow:  “If the only tool you have is a hammer, you treat everything as if it were a nail.”

We wonder if this will be the case with the most recent and arguably most interesting crossovers in quite a while: consumer packaged goods expert, Bob McDonald, former CEO of Procter & Gamble named head of the beleaguered Department of Veterans Affairs (known affectionately as “the VA”.)

While the VA appears to have both serious operational and marketing challenges, it will be interesting to see how a veteran of brand wars attacks them.  Since he is a “carpenter”, will he rely solely on his hammer?

In the interest of service to our nation, we have some lessons from our CPG colleagues that may cross over nicely to the VA:

  • DISTRACT FROM DELAYS.  What manufacturer has not experienced delays in getting product to a customer?  Savvy sales execs always have alternatives to soothe the savage beast.  Many times, atop that list is substitution.  In this case, offer something else that pleases or at least distracts while you work on your logistics issues.
  • SUBCONTRACT.  If you don’t have what it takes, let someone else provide the item or service while your company covers the cost.  If you do it in a seamless manner your customer may not even notice…but if they do chances are they will be impressed by your pluck.
  • FOSTER COMPETITION.  Healthy competition between brands has always been a cornerstone of P&G’s success.  The “umbrella” of products need to be complementary, with each brand manager working toward a common corporate vision and purpose, all infused with a healthy dose of friendly competition (and reward$, of course).
  • NIX WEAK EXTENSIONS.  This is one P&G knows well:  kill that dying SKU.  You don’t want too many flavors:  products, services and procedures that don’t add value but instead create customer confusion and erode core competency.
  • BUILD BRAND AMBASSADORS.  Perhaps the key issue for the VA in this case is that only the bad news got out.  What about the millions of satisfied customers?  Develop dozens — no, hundreds — of compelling stories from this group that will galvanize the nation.  In short, what the VA brand seems to be missing is a Marine-like formation that will cultivate media, blog, Tweet, Facebook and Pin, yelling from the mountaintops to the sea til death about how great the place is.

Best of luck, Bob!

Mislabeling and other misdemeanors

Not enough Wonderfulness in the product
Not enough Wonderfulness?

This week “Big Red” (Coca-Cola) took a beating in the Supreme Court from no other than “little red” or  (P♥M Wonderful) about juice that contained a lot less pomegranate than was claimed.  (You can read more about this case in the link below )

We admit we side with “David” here:  the husband-and-wife agribusiness team who took a strange fruit that was a real mess to eat and transformed it into a convenient juice favorite (becoming billionaires in the process, of course.)  “Goliath” then comes along and taps into the wonderfulness.products_pom_blueberry_product_detail

This case takes us back to that powerful feeling as young AEs on “Big Blue” (Pepsi) business whenever we got a chance to bash “Big Red.”   We even helped our clients host an annual event for this very purpose, bringing in the beefiest DSRs for a boozy (Cuba Libres, anyone?) contest with a prize for whoever could smash a Coke vending machine with a sledgehammer the fastest.  (Note this was post-Mad Men era…but obviously not too far ahead of Cro-Magnon Man.)

While the verdict is still out on how the potentially-landmark P♥M vs. Coke case will ultimately affect labeling, we marketers always look at these with great interest and no small amount of fear.

We’ve posted previously about how we can squeeze through the legal gates with what we say to help our client’s product stand apart.  On the flip side, we also mentioned how the once-magical term “natural” is now rendered limp from overuse.

Both the FDA and  USDA are touchy regarding nutritious claims, so food marketers have always avoided even nebulous statements like “…with plenty of Vitamin C!”  “Plenty” needs to correlate to a specific gram or percentage.

The P♥M folks did their homework, though, spending millions on scientific and consumer research to prove that pomegranates were really a nutritional powerhouse.  Absent this kind of support, copywriters have been forced to resort to colorful but unmeasurable terms such as “Chock-full!”.

In summary, the key marketing lesson here is that while smaller brands may fear mislabeling mistakes the most, typically it’s #1 who gets smashed with the sledgehammer.

(Read more re P♥M vs. Coke here)

 

 

 

Secret stuff

It's what's for dinner
It’s what’s for dinner

We’re lovin’ it.  McDonald’s secret menu, that is.

This week, the business media was buzzing about two major restaurant chains that have these.  Starbucks is the other.  Maybe there’s more of them we don’t know about, but surely there are more to come.

What it involves is what some of our foodie friends do at five-star establishments:  ordering off the menu.  But we’re talking  QSRs here,  and the “secret” menu is actually on the menu, it’s just that you can’t see it.  And this is where it captures the imagination.

This menu strategy involves serving items that are not printed or promoted anywhere, but apparently customers know are there.   The tactic involves using word of mouth to promote.  One satisfied diner and a text later,  the viral effect kicks in.

Let’s face it, who doesn’t want to try something “secret”?  Starbucks apparently launched  this new strategy with their Cotton Candy Frappuccino (photo above).  Yuck…for us adults, but we’re not the target market.

In fact, only kids seem to know much about this drink, and whether it even tastes good seems beside the point.  It’s all about the experience.  Junior can now share in your daily adult coffee fix, and Starbucks can count on it being Facebooked or Twittered before you can say “Machiatto”.

McDonald’s has sprung this secret menu strategy with success in key foreign markets.  In Brazil, just in time for the World’s Cup next month, you’ll be able to order a side of traditional rice and black beans with your Big Mac.  (That might be the only thing that will actually be ready in Rio in time for the Cup…but that’s a whole other story.)

Or, if your tastes are more refined or restricted, you might prefer a sautéed chicken breast with small boiled potatoes for a few cents more.  But you have to know the code to order it.  (Shhs…it’s the “prato executivo”, or executive plate.)

Lest we think this is all about expanding assortment, let’s think again.  It’s about delighting — and retaining — the customer.  It’s savvy customer segmentation, allowing the chain to be all things to all people, while making you feel like a member of a special club.

You’re probably not going to see these chains openly promote this practice, at least not in their advertising.  It goes against their core competencies and the brands they have so carefully cultivated.

This is where the marketing lesson lies:  there’s a time for transparency…and then there’s not.  When that time comes,  stealthy is the way to serve it.

Was it good for you, too?

Go-to gal
Our go-to gal

In our continuous quest to find out what makes the supermarket shopper tick, we often rely on the go-to folks on this topic:  consumer affairs directors (or CADs, as we call them).

These are often the unheralded, way-back-in-the-corner office, female (mostly nutritionists or dietitians) at most major supermarket chains.  While category managers and buyers are great for telling you about what’s good for their chain, CADs will tell you what’s good for their customers.

We find CADs are like the school nurse:  she knows her patients well and can spot an epidemic before anyone else.  She can also tell when you’re faking it.

That’s because shoppers, like schoolchildren, lie.  Our experience has shown us that shoppers tend to tell researchers what they think they want to hear, such as: “Yes, we’re eating much healthier now!”  But the scanner data reveals a different picture…until now.

One CAD at a regional chain has seen scanner data that shows the tide has shifted.  Shoppers today are really into “good-for-me” items, she explains:

“We believe it’s the cumulative affect of the new healthcare initiative, more active lifestyles, concerns about the environment, and the phenomenal growth of natural and organic foods. They’re leaning so much more on social media now, and are just more aware of these issues.”

This viewpoint is echoed by the explosive growth of chains such as Whole Foods, Sprouts, etc., with new banners (i.e. Mariano’s) popping up, joining long-time purveyors like Stew Leonard’s and others that serve up retailtainment alongside the kale.

Even mass-marketers like WalMart see the sea change.  CEO Bill Simon noted in a recent report by PlanetRetail:  “Customers needs and expectations are changing…and we are transforming our business to meet their expectations.”

And transforming they are.  Along withTarget, and Dollar General chains, Walmart is leading the march toward new, smaller-format stores featuring trendier, healthier SKUs.  Drugstores chains like CVS are also revamping,  creating health-hubs where shoppers can consult with care and nutrition experts.

The question our clients are asking now is:  “Is good for them good for me, too?”  Several seem convinced, and are now focused on launching products and marketing communications that reflect goodness.

While corporate sustainability and social responsibility initiatives are almost old hat by now, there are some cornerstones for building a “good-for-you” campaign worth remembering:

  • Tell a story.  The magic of corporate story-telling is not to be underestimated, even if the narrative doesn’t directly relate to health and wellness.  Find compelling and heartwarming info about your family and/or company’s history to tout: “rags to riches” anecdotes, key challenges surmounted, etc., and watch the “halo” effect take hold.
  • Stand for something.  Ideally, the storytelling should include a unique positioning, ideology, philosophy that sets you apart from those without a mission.  Everyone knows you’re in business to make money: there ought to be something more.
  • Put your money where your mouth is.  Even a humble effort toward some form of social conscience, such as Fair Trade certification, a corporate foundation, or community-giving program allows you to say you’re involved.
  • Beware of “natural”.  It’s become a  cliché, in fact, has lost its meaning.  We’ve also blogged about that type of labeling coming under fire by the regulators.  Surely there are other, more creative terms for identifying your product attributes…

Remember: “good for me” is a fairly open concept.  It doesn’t have to an actual product attribute but can merely be a corporate attitude that’s communicated passionately and creatively.