Marketing College:Essential Marketing Knowledge.

Cometh the Hour, Cometh the Man?

2009-01-11T10:36:00.000-08:00

This month saw the annual Macworld conference take place in San Francisco. For Apple, this is a major event, used to launch spectacular new products to an always-eager world. Apple’s customers almost seem to beg the company to sell them something new...

Notably, Apple’s charismatic CEO Steve Jobs was absent, attracting much media comment. Jobs - a co-founder of Apple along with Steve Wozniak – has not always enjoyed an easy relationship with the company. Nevertheless, he is seen as a shrewd entrepreneur who enjoys a positive profile – Jobs is Apple to many, and his infectious explanations of the latest company gems at Macworld are a key part of the Apple brand.

Jobs is a cancer survivor, and his failure to attend the event has provoked some to ask who his successor could be, and what qualities that individual should possess. Jobs has sought to distil the media furore by stating he is suffering from a hormone imbalance, from which he will recover. I hope so.

This event underscores why the role of the CEO is so important. How they build a corporate image in a way that reflects positively on a company’s products has been recognised as a way of ‘building brand awareness and knowledge in a cost-effective manner to reach specific audiences’ (Kotler & Keller 2008, p. 317). Jobs’ role at Macworld has been to promote the brand of Apple as an innovative producer of desirable products, and how successful he has been!

The power of CEOs to influence the public perception of their organisations, and thereby contribute to corporate health, is undeniable. Here are some other notable examples:

Richard Branson, who seems to enjoy a similar profile to Jobs. Virgin does possess a very strong brand identity, and Branson’s publicity stunts are well known.

Gerald Ratner, whose gaffe in the early 1990s when he described his company’s products as ‘crap’ at a key speech, was disastrous. (Now apparently known as ‘doing a Ratner’).

Bill Gates, whose massively successful company Microsoft has adopted business tactics that have been brought in to question on a number of occasions. Gates’ profile has been variable at best, although he has now started to enjoy greater recognition for his philanthropic work. How this has influenced the public’s perception of Microsoft remains to be seen, although Gates has appeared in recent adverts (‘I’m a PC’) designed to challenge Apple’s ‘I’m a Mac’ campaign. Would this have been appropriate 10 years ago?

My questions are these: if the power of mass advertising is weakening, should companies be more reliant on the personality of their CEOs? Will charismatic leadership combined with a positive media image be of more value in future, and what are the risks involved?

Power to the People

2009-01-02T23:23:00.000-08:00

The era of handheld Internet applications has just begun to empower consumers. With the ability to instantly index bar codes against a local database, consumers will be able to directly compare prices instantly on items in a retail store.

This technology, currently enabled by the iPhone and Google handsets is only the beginning of the impact of instant data sharing among consumers. One of the things many retailers depend on is the relative price ignorance of consumers or that they will be able to recover the cost of their loss leaders on the profit spread of the other merchandise purchased. Will that be compromised?

What if consumers each took the time to report the price of big ticket items, such as automobiles and cars? If I could see what the last 5 people paid for their Toyota Camry I am likely to get mine for less than any of them paid.

Combining this technology with GPS enabled hand held or with Internet mapping and the properly position company could literally lure people directly to their doorstep. Creative marketing techniques might even include using the very price comparison technology directly on store shelves to demonstrate low prices. This would seem to me to put a strong downward pressure on the difference in retail pricing among stores at least those in close geographical proximity.

This technology probably also stands to most benefit those companies who benefit from economies of scale and who have the lowest prices on average.

Can you think of a time you paid for something and a short while later found it on sale somewhere else cheaper? Would you use technology like this?

Zune Hell

2008-12-26T14:19:00.000-08:00

I was in Zune hell on Christmas Day, but I am getting out. I am returning the Zune I got for Christmas and going back to my iPod. I spent several hours trying to get it to work. I give up. Not my idea of fun. When I hooked it up at first, I got all sorts of error messages saying I needed to install software. When I tried to install the software, it crashed. After several tries and reboots of the computer, I got the software to install, then it told me I needed to install yet more software. (All this software was the "babysit" kind, where you have to hit "next" every 5 to 10 minutes). I finally got all the software installed, then it wanted me to sign in and create an account, then start the free 14-day trial. Will someone tell Microsoft that the landing page after signing up for the 14-day trial should give some kind of hint as to what to do next? All this took hours. I finally got the software running, and figured out how to find a song. But I made the mistake of double-clicking on the song, and it wouldn't stop playing! Nothing I did could stop the song. I had to control-alt-delete to run task manager to kill the program to stop the song. And the Zune still won't work. No matter what I do, it says "music" --every button I push, and I've tried them all, in various combinations. "Music" says the display, mockingly, with no sound. The battery icon indicates a full charge. I realize that a few more frustrating hours could get me video in my pocket, but I am going back to my iPod, which installed and updated first time and every time. I'd rather have less stress and less video in my pocket, than more of both.

Targeted use of Internet Advertising.

2008-12-19T05:20:00.000-08:00

As an Australian living in the UK my internet browsing habits are probably a bit different to most of you and I have noticed an interesting marketing tool that may be of interest.

I read the Sydney Morning Herald almost daily, because it keeps me up to date with what's happening at home and it also because I like it's coverage of world affairs.

Recently I have noticed that the advertising I see on the site is particularly targeted to my circumstances. In particular I see advertisements for currency exchange services and ads from recruitment agencies offering me the opportunity to be 'head hunted' back to Australia.

Obviously the web site identifies my location from my IP address and targets the advertising appropriately.

Everybody wins from this. The normal, Sydney based, advertisers don't care whether someone in the UK doesn't see their ads and presumably don't demand a reduction because of it. It's probably in the fine print. The targeted advertiser is offerred a chance to advertise in a major publication at a fraction of the cost of the full rate. The newspaper makes some extra revenue and even I don't mind seeing ads that are more relevant to me. Actually it makes me feel kind of special.

Check out http://www.smh.com.au/ if you want to see what I mean.

What other clever uses of internet marketing have people seen. I know every time I go online to Amazon I get an email from them.

Fat Silver

2008-12-17T20:15:00.001-08:00

What can marketing/marketers contribute to economic revival?

2008-12-10T13:40:00.000-08:00

This post was submitted on behalf of Janetta:

Now that economic growth based upon easy credit has ground to a halt the rhetoric has changed from “spending too much”, particularly in the retails sectors, to “spending too little”.

The high street has responded with sales and promotions. The government is trying to respond via fiscal policy. Namely, changes income tax and VAT. Are these responses likely to be effective and what are their outcomes, both intentional and not intentional in the short to medium term?

Customers, who have any purchasing power, will benefit from the sales and promotions which will generate some cash for the retailers but not as much per item as they had anticipated. Everyone, regardless of income will benefit from the 2.5% reduction in VAT, which is a positive step in itself as VAT is a regressive tax which falls disproportionately on those with lowest incomes. It is, however, unlikely to generate much additional spending as demand is relatively inelastic in the current economic climate, as the retailers are discovering, with up to 50% reductions still not resulting in the required additional sales of goods.

From a marketing perspective such broad brush responses only form part of the environment in which they operate. Decisions will have to be made as to where a good or service is to be positioned in the market and specifically and who the likely customers are. Some people in the upper to middle class/income group may well be better off due to the environment outlined above plus reduced interest rates on their mortgages. There may well be scope here for marketing higher end goods and services targeted at this group.

Conversely, it has already been noted that changes in customer behaviour in favour of cheaper alternatives such as discount retailers such as Lidl and Aldi and choosing eating at home options rather than eating out (Dominos). Has this been a temporary “knee jerk” reaction to media hype regarding the effects of a recession on “everyone” when in fact many people such as those in secure public sector jobs may well be better off than they were before? Unemployment will fall, as always, disproportionately, on manufacturing, retail and non statutory service sectors, belying the fact that these are the sectors which successive governments have propounded to assist to underpin economic growth.

How the labour market responds over the next few months will generate challenges and opportunities for marketers. Those who correctly identify their key segments and customers and act ahead of competitors in generating demand for their products and services may well change the domestic retail and service landscape determining which businesses thrive and those which fail. Marketing may be a more powerful instrument in determining the economic future than the blunt ones so far proposed by the government.

Janetta Jones

Barclays - Slippery Slope?

2008-12-10T13:26:00.000-08:00

This article is submitted on behalf of Ceri:

Although the banks have dominated the news over the past few months my posting is nothing to do with the bailout of the banks, mortgages or interest rate cuts.

Having bought my house less than 2 years ago, when house prices were at their peak, I try and avoid the majority of the depressing news items on the current economic climate in fear of finding out that my house is now worth significantly less than I paid for it. Instead, I decide to spend my evenings watching people like Esther Ranzen being locked in a box and eating eyeballs.

It was during one of the commercial breaks for ‘I’m a Celebrity get me out of here’ that I first saw the new Barclaycard commercial – the one with the man going down the waterslide. I’m sure that the majority of you have seen it by now, but for those who have not here is a little bit about it:

It begins with a geeky office worker stripping to his pants and leaving the office for home through a store cupboard. Once in the store cupboard he then jumps on this huge waterslide that travels around the city (Sao Paulo and Rio de Janeiro – I think). It goes via a grocery store and a library until finally arriving at his house. I forgot to mention that he picks up a banana on the way and gets stuck in the library. If your thinking random, very random then your right.

The first few times I saw this commercial I had no idea what the advert was trying to tell me about Barclaycard. Having just started an MBA module as part of my MBA I watched the advert with my MBA hat on and thought – who is the advert trying to target? What is the advert trying to tell me? Does it make me want to run out and get a Barclaycard? The answers to these questions at the time were ‘don’t know’, ‘don’t know’ and ‘no’.

However, having now seen the advert a few times, there is undoubtedly something about it that makes me want to stop and watch. It is humorous, intriguing and the Bellamy Brothers theme tune will have you dancing about your living room like John Sargent.

The commercial is in fact advertising the new Barclaycard contactless technology http://www.barclaycard.co.uk/personal-home/easy/ - however this is insignificant. The commercials real merit is in the impact it will have had on the awareness of the Barclaycard brand. You Tube have labelled it the best commercial of 2008. I am interested to see what you think.

Put your volume on max, enjoy and let your love flow!

http://www.youtube.com/watch?v=6JUKjR-5UzI

Ceri

Zero Finance Car Marketing

2008-12-05T05:46:00.001-08:00

Car Finance Marketing
In recent times I am starting to hear a lot of advertising on the radio for zero percent finance. The likes of Vauxhall and Renault are advertising it and Volkswagon is pushing it on commercial vehicles. And it sound like a great deal, especially when no one is lending money. I suspect that you don't gain much out of it. The price of the car will be adjusted to cover the cost of the dealer borrowing the money and lending it to you for free. But with interest rates at all time lows that differential has eroded and is far less noticable. It makes good sense for a strong company like a car manufacturer to borrow at these rates and use it to entice you to buy their product. But will car companies get burnt the way banks have in the last year. I presume they are not naive and will have thought of the risks (although I would have said that of the banks a year ago). I think it's a smart piece of lateral thinking and clever marketing.

End of an era for the UK High Street

2008-11-26T09:55:00.000-08:00

It's been a long time since I actually bought anything from Woolworths but I was sad to read of its demise today. Back in the 80s I worked in my local Woolworths, sweeping up after school, and later as a supervisor of Saturday till staff. The store had a family atmosphere (complete with elderly matriarchs in the cash office and an avuncular manager). A full time job there was seen as a career by many of their staff.

Woolworths has been an icon of the High Street since 1909 (when the US-owned F W Woolworth & Co Ltd opened their first stores), and a fixture of the FT30 index of leading UK companies (a precursor of the FTSE100) since its inception in 1935. A year from their centenary, Woolworths has a nationwide network of over 800 stores, and 30,000 employees who now face almost certain redundancy. Having rejected a bid from frozen food chain Iceland only 3 months ago, today Woolworths failed to find a buyer to save them, and they appear to have collapsed under the weight of spiralling debt.

"Woolies" has (or had) a special place in the UK's national psyche. A Woolworths store was once a treasure trove of useful household items, quality toys and games, pop music (particularly back in the 7-inch era), "pick 'n' mix" confectionery, and the only photo machine in town. Their brand was a byword for economy and variety.

Perhaps inevitably, as UK society and consumer behaviours have evolved over the last two decades, Woolworths lost focus on (or could not maintain) their core competencies and - aggressive business policies aside - its survival this far has largely relied on increasingly low quality goods. As a result, although a certain nostalgia remained, their brand lost its lustre and its meaning. As a recent article in The Guardian's online edition stated, "it is no longer clear what the store is for... Woolies has outlived its usefulness and many of its products can be bought more cheaply elsewhere."

A brand can outlive you, but it cannot save you.

Now, anyone know where I can get some passport photos done?

Marketing of Public Safety - The Dilemma

2008-11-16T11:55:00.000-08:00

As a police officer studying Marketing as part of my MBA studies I have been interested in the role of marketing within the police service.
If the primary purpose of policing is to improve public safety it is essential that the police service address two critical issues. One is improving the actual safety of the public i.e. reducing crime rates and detecting reported crimes. The second is to reduce the fear of crime. The fear of crime refers to the fear of being a victim of crime as opposed to the actual probability of being a victim. The fear of crime can have a number of damaging effects on individual and community life.
The problem for the police service is that the fear of crime is often disproportionately higher than the actual crime rates. The dilemma for the police service is that in marketing police success and ‘actual crime rates’ only raises awareness of crime and disorder as an issue and as a consequence (I suspect) increases fears of becoming a victim. For example, a past initiative has been to inform local residents of the outcome of search warrants targeting local drug dealers. Whilst this may reassure some local residents and convince them that the police have been active and have addressed a local problem, for those that were previously unaware of the local drug problem the marketing of the operation has only alarmed them that they have drug dealers in their neighborhood.
I would be interested to receive your comments on this dilemma. I remain convinced that marketing has a positive contribution to make towards improving public safety I have just not yet figured out what it is.

Can we beat the credit crunch?

2008-10-05T09:35:00.000-07:00

Economic Downturn?...Dwindling Sales?...Maybe not. Some companies have made strong sales recently, despite the gloomy financial climate. Domino’s and ASOS are two successful examples. Domino's has benefited from consumers tightening their belts to save money, as eating at restaurants becomes increasingly expensive. While ASOS discounted clothes have continued to be in steady demand from young customers. In addition, both of these companies focus on on-line shopping as their main retail channel.

I’m sure we can find various other examples such as “pound” or “dollar” stores and discount chains. But the question for us marketers is: Can every retail company beat the credit crunch by implementing new marketing strategies to cater for the cautious consumers? Can it also be the case for those companies that position themselves or some of their brands extremely high in the consumer’s mind (such as luxury brands)? How about niche or specialist companies?...What do you think?

Here is the story from BBC news website:
-------------------------------------------------------------------------------------------------------------------
Two firms - a fashion retailer and a pizza firm - have bucked the trend and seen solid sales recently, despite the economic slowdown. Online fashion firm ASOS saw sales more than double in the six months to 30 September, compared to the same period a year earlier, a trading update shows. Meanwhile Domino's Pizza saw sales up 8.8% year-on-year in the third quarter.

Both companies remain positive in their outlook and expect strong growth to continue, as consumers seek out deals. Despite the good news, shares in both companies slipped 2% during morning trading.

Many firms have been hit as consumers try to tighten their belts, following higher fuel prices and mortgage costs. However ASOS, which has its own brand clothing as well as discounted designer labels, has benefited from solid demand from young customers and a shift to online spending. Chief executive Nick Robertson said: "We believe that our business dynamics and customer base should be resilient to the wider economic issues and that online shopping will continue to gain market share."

Domino's has also benefited from consumers' desire to save money, as eating at home becomes increasingly attractive. James Cooke, an analyst at Panmure Gordon stockbrokers, said: "Despite the slowing of the economy and squeeze on consumer spending, Domino's Pizza continues to see organic growth in the business".

Advertising invades U.S. Air seat trays

2008-07-17T13:36:00.000-07:00

There is tremendous competition for the consumer's attention these days. Any opportunity to grab his or her awareness--even for a moment--is precious. The other day, I noticed that advertising has now crept onto the fold-down trays on U.S. Airlines' seats. On busy flights, the crew will sometimes ask passengers to have their trays opened before the beverage station reaches the the passenger, prolonging the exposure to the advertising message. Hopefully, with clear plastic glasses, the beverage will not cover the advertising message.

This is one of the more devious tactics I have seen recently. It will be interesting to see if passengers--used to nice, neat, clean trays--will object to what may seem like aesthetic revulsion.

Back on the Coffee Bandwagon

2008-07-07T17:04:00.000-07:00

I happen to come across this opinion editorial that appears to confirm what a lot of people are saying about the mighty Starbucks brand.

Rebates Stink

2008-06-15T13:40:00.000-07:00

I said I would rather buy an item for $19 rather than an identical item for $20 with a $5 rebate. This is straight math: Estimated time to fill in the rebate form once you have everything ready: 5 minutes. Chances of having everything ready without spending gathering time: 10 percent, tops. What you need ready is: the rebate form, the receipt, the box the item came in, a knife to cut the box, a larger than normal envelope, extra stamps, and a pen. I estimate at least a 10 percent chance of spending 30 minutes to try and gather everything, then giving up and not getting the rebate . Average gathering time is about 10 minutes. Then there is the tracking time, of about 10 minutes spread over the 6 to 8 weeks it takes to get your rebate back, and where you get mad at someone if the rebate doesn't show up. Chances of the rebate not showing up for whatever reason, at least 10 percent. Time spent in chasing down a rebate that does not show, 60 minutes. Time spent in cashing the rebate check: 1 minutes.
So here we are:
5 minutes -- filling the form
0 minutes --gathering times 10 percent
10 minutes -- gathering times 80 percent
60 minutes -- chasing no rebate times 10 percent
10 minutes -- tracking time spread over 6 - 8 weeks.
5 +8 + 10 + 6 + 1 = 30 minutes

Extra stamps cost about 80 cents

chances of no rebate -- 20 percent (10 percent your fault due to gathering difficulties, 10 percent other).
So the rebate sender spends a half an hour for an 80% chance of getting $5 less 80 cents in stamps, and a 20% chance of spending another hour plus for nothing. That is way less than minimum wage.

No thanks.

Eat your words!

2008-06-13T18:05:00.000-07:00

I have never seen advertising like this before. But I've always wanted to be able to eat my words.

"Marketing works, but only if you have the right product."

2008-06-11T14:57:00.000-07:00

Just read this article that suggests that various marketing channels and methods will only work if the product is right. The author downplays the effectiveness of interruptive advertisements such as TV, radio and banner ads, and emphasizes in the future, it will be all about viral or social marketing.

Creative?

2008-06-05T23:33:00.000-07:00

I was browsing through my typical list of websites for the evening and came across this interesting collection of ads.

This one is my favorite

However, this one reminded me of

Mr. Clean from our course

Click title for entire collection.

Difference between product advertisement and Political advertisement

2008-06-05T15:29:00.000-07:00

Whether it is a product or politics, options sells everywhere. At the product side, companies do not advertise negative ads and compare their product with the rival firms. You will not find negative advertisement between coke and Pepsi. Whereas political marketing campaign usually go with negative advertisement. There were four negative ads during Clinton’s campaign.

Cell phone users outside U.S. secretly tracked

2008-06-04T12:31:00.000-07:00

http://www.msnbc.msn.com/id/24969880/ the privacy issues mentioned here support the doubts that were raised during the datebook phone service presentation.

Rewards program for coffee

2008-06-04T01:14:00.000-07:00

With rolling out their new free Wifi internet access, Starbucks is looking to gather the goods on you in return. Article in title.

how will GM market remaining inventory?

2008-06-03T10:47:00.000-07:00

Today Gm announced closing of 4 truck & suv plants. Gas price is predicted to increase more.So how will GM market the remaining inventory on hand with already declining sales. The only avenue I see is marketing in countries like Venezuela where gas price is 19 cents due to subsidy. This was they can get rid of inventory on hand and focus on smaller cars like in Europe ( as gas prices were always high there)

New Airline Baggage Policy

2008-06-02T14:00:00.000-07:00

American Airlines is setting precident for a new policy - charging for checked baggage. It is likely other airlines will eventually follow suit, unless they can recognize how stupid this is.

"Customers who purchase domestic economy class tickets on or after May 12, 2008, but before June 15, 2008, may check one bag for free and check a second bag for $25 each way. Customers who purchase domestic economy class tickets on or after June 15, 2008, will be charged $15 each way for the first checked bag and $25 each way for the second checked bag."

What is your opinion on this?

Here is mine:

- I would like to think I will steer clear of this policy, as long as possible, but there could be the point where the price of the ticket plus baggage is cheaper, so I'll just be annoyed and pay it. But, given that generally airline tickets are the same, I'll likely just go with another airline even for a few bucks more, just to avoid the hassle.
- Up until now airlines have encouraged people to check bags to save cabin space (the upper bins above the seats), but now, to save a buck, people are going to take as much as possible into the cabin. This will lead to crowded aisles as people try to shove their stuff in place, causing delays in boarding and deplaning, which in turn will cause dissatisfied customers!
- Just as people hate all of the hidden fees on credit cards and cell phone contacts, soon they will hate airlines for all of the hidden fees and policies

The policy will drive away business and negatively impact customer service - not too smart, if you ask me.

- April

Top Global Marketers

2008-06-02T13:40:00.000-07:00

Who are the top global marketers? According to Advertising Age, there are two parts to the answer: top advertisers by media spend and the international agencies that handle them. The annual report, now in its 21st edition, is referred to as 'the dots'.
Some of the things that I found interesting in review the annual report include:
- Ad spending is tracked by a number of organizations: Neilsen, IBope, PARC, more
- The top spender is Proctor and Gamble, spending over $8.5 Billion dollars worldwide
- Many of the ad networks are owned by the same holding company (see page 3 of globa accounts report)
- Multiple networks will handle the same brand, and in some cases, ownership is broken down by line of the brand; for instance, Ford has 15 different accounts.
- You can view ownership by advertiser or account

Enjoy!
April

Free Gas Cards

2008-06-02T13:37:00.000-07:00

The Thursday before Memorial Day weekend, Verizon Yellow Pages caused havoc at the Bragtown Shell. Cars were lined up for hours to receive a FREE $40 gas card, sponsored by Verizon Yellow Pages and given to the first 200 cars. Although people were intrigued enough to start lining up just after midnight, was the promotion effective? Will customers remember that Verizon Yellow Pages sponsored the event or will they only remember the free gas? Would this promotion have been more effective if it was sponsored by a company in the industry of gasoline (such as Shell or Exxon)? If Shell gave me a $40 gift card, I would be more inclined to visit their gas station in the future.

http://www.newsobserver.com/news/story/1082668.html

Strong Brands

2008-06-02T12:59:00.000-07:00

Companies such as Prada, D&G and Christian Dior have established themselves as top of the line brands. Their strong image allows them the opportunity to penetrate markets outside of their primary focus. Although these three are high fashion brands, they have moved into the mobile market. Christian Dior, a high fashion brand, has recently announced they will be releasing a line of cell phones. Although the average price for a smart phone is $101, Dior will be retailing their new phones for a high $5000 each. Due to the price range, Dior’s cell phones will not be competing with Motorola or Nokia but rather Prada and D&G in the newly created market for brand-name cell phones. Does strong brand awareness allow companies the ability to create new markets?

http://tech.yahoo.com/blogs/hughes/27919

Buy One Get One Free Deal - on Houses!

2008-06-02T12:38:00.000-07:00

I just read this online and had to post it. The prevalent marketing and pricing strategy of offering "buy one get one free" has reached a new level: homes. A housing developer in So-Cal is offering a free $400.000, 2000 sq ft house in Escondido, if you buy a $1.6 million house in San Pasqual Valley. How really effective is this pricing/marketing strategy? At the least, he is getting some free publicity.

Microsoft re-launches advertising under a new brand

2008-06-02T00:57:00.000-07:00

In a recent lecture we discussed rebranding, I wanted to share with you a real live example of Microsoft Advertising (a new brand launched only last week).

Justification for rebranding:
Over the past year, Microsoft has both launched multiple online advertising solutions + has acquired new firms i.e. Aquantive. This has left its clients confused to the say the least. New brand will pull together existing products such as Advertiser and Publisher Solutions Group (APS), Atlas, AdECN, adCenter, DRIVEpm under “Microsoft Advertising”

Beyond the new logo:
The personality of the brand will be focused around 3 key areas:
1. Performance: media and technology offerings help advertisers and publishers drive superior results;
2. Insight: sophisticated data collection and analytics systems help provide critical insights to our customers about their business;
3. Expertise: talented and dedicated employees (all of you) bring a tremendous amount of expertise around media and technology to help our clients solve complex business problems.

Link to the new brand: http://advertising.microsoft.com/coa

Recent articles on the topic: http://www.foxbusiness.com/story/markets/industries/technology/microsoft-highlights-breadth-mobile-advertising-advance/-1782649517
On a side note - From the article above, here is something we discussed/demoed in class
“Microsoft also announced plans to further expand its mobile offerings for advertisers to now include mobile search advertisements on Live Search Mobile. For the first time invited advertisers can create keyword campaigns through Microsoft adCenter that target customers on the go while they are using Live Search Mobile. This will be the first time that Microsoft has enabled advertisers to monetise its popular mobile search service. The beta is currently available in the US and will be expanded in the second half of 2008”

Social Networking Potentials

2008-06-01T20:25:00.000-07:00

There is a concept in viral marketing called Social Networking Potentials -- individuals who have enhanced influence over otheres through social communities such as MySpace, Facebook, You Tube, blogs, online bulletin boards, etc. Survey research can quantify the potential of users depending on their responses to a number of variables such as group membership roles, leadership, recognition, contributing to or publishing in various media, and so on. The advantage of using these SNPs to pass on marketing messages is the low expense and the flexibility of such a campaign.

To me this makes sense. It's old-fashioned word-of-mouth marketing amplified by the online social communities. Do you think this is a good way for a new product to get a "buzz"?

Those Silly Little Links

2008-06-01T18:47:00.001-07:00

So I was reading the news on MS-NBC yesterday and noticed something: A whole bunch of tiny advertisements under the heading “Sponsored Links”. The products I typically see there are for everything from refinancing to weight-loss products to improving computer performance. Pretty much, it’s all of the same spam I used to get in my email before I put the spam-filter on it.

My question is: Who even notices these things? I mean, I see them, but I never think of clicking on them, just like I never clicked on the links in the spam emails that were sent to me. I have to wonder if there is any kind of real revenue generated for the people using this as a means of advertising.

I’m guessing there has to be some effectiveness to this kind of advertising, but I have to also question if the people clicking on the links are really the target demographic of the advertisers. Really, it looks more like a ploy of desperation and complete lack of a marketing strategy. It must have some effectiveness, though… The ads have been there for quite some time.

CMO success at Macy's

2008-06-01T10:28:00.000-07:00

http://online.wsj.com/article/SB121133559993909309.html
An article and interview with the CMO of Macy’s provides great insight into some of the ways in which CMOs are being successful. The CMO is also the head of the online business in this case. He is working with celebrity endorsers and mass marketing specific brands, and at the same time utilizing new and old media in innovative ways to build on the brand. His involvement in the online business means that he is directly involved in building the Macy’s customer experience for the web, which could potentially be a very significant revenue stream in the future. The ‘My Macy’s” initiative works on both local levels through newspapers and local ads, and the on the web. They are also building a strong integration of the online and in-store inventories to simply the purchasing process.

What are you doing with your gov't rebate check?

2008-05-31T18:04:00.000-07:00

Now that the rebate checks are in the mail and the economic stimulus package is well under way, what are the consumers doing? Clearly the government is hoping you will spend, spend, spend. Unfortunately for retailers, the needle barely moved on consumer spending which was up only 0.2% in April. I had expected more companies to actively market to $106.7 billion up for grabs after Congress passed the bill in February. So far the only thing noticeable is the lack of spending by the consumer and the lack of marketing by the advertisers.

Perhaps overcoming four straight months of job losses, a wobbly stock market, plunging home prices and record high gasoline price hasn't left consumers in a buying mood no matter where the money is coming. But that would be responsible buying behavior and that's NOT the American consumer I know.

Should single product company go with product offerings technique?

2008-05-31T15:09:00.000-07:00

Most companies start with a single product line and take time to provide different product offerings. Just as an example some software companies have one single product with 10 features. They segment their features with two offerings. One has 7 features and the other with all 10 features. I see that software companies define their product features with product offerings. For example Taleo, an HR solution.

Is this a good idea to define that company has wide product offerings?

New Targets

2008-05-30T21:53:00.000-07:00

With mobile phones being the new big thing in advertising I thought it would be interesting to examine another sector in the mobile market, that of the phones themselves and how they are targeted. Specifically I've been reading a little about the next generation of smartphones and found it interesting to see how trends have been going recently.

Since their inception smartphones have been designed and targeted towards mobile professionals, or people with lots of money and the need for nifty gadgets. But business has really been the target because the features designed into such devices naturally lend themselves to business. You'd only see Blackberries on those that got them from work to keep in touch via email at all times.

But then in the last few years there has been a shift in the marketing of these products. Now Blackberries are being loaded up with features and apps that are meant to appeal to a wider consumer base and not being targeted solely towards businesses anymore. They are trying to become the phone for anyone and everyone who talks, texts and emails.

The flip side is the iPhone, created for the individual, they are now working to incorporate enterprise email capabilities to begin to market towards businesses. While I personally haven't seen much marketing on either of these products yet, except for the writeups online that I've read, I think it will be very interesting to see how things pan out when the next generation of Blackberry and iPhone hit the shelves and start really competing for similar targets.

Differentiation: The Wii Factor

2008-05-29T23:30:00.000-07:00

“We are not competing against Sony or Microsoft. We are battling the indifference of people who have no interest in videogames” – Satoru Iwata, President and CEO, Nintendo Co.

As Microsoft and Sony spent heavily to beef up their next gen systems, Wii has quietly taken a relatively low tech machine and proudly winning the console match. Wii is practically sold out everywhere these days, 16 months after its Dec ’06 launch - an amazing feat in this highly competitive industry.

Here’s a quick comparison for the 3 machines.

Differentiation is exactly how Wii has won it.

Video games and systems are getting more complicated. Think of Wii as the McDonalds answer to Starbucks. By offering less capabilities from its counterparts, Wii focused on being simple, innovative (Wii Remote) and fun. A differentiation strategy is effectively only when it’s valued by the customers. Xbox360 and PS3 are leaps and bounds ahead (technology) of Wii, but by focusing on game expansion, Nintendo is bringing the “fun” factors back to gaming.

Pricing at loss for market penetration

2008-05-29T11:16:00.001-07:00

I was surprised to know that when Microsoft first launched xbox, they were losing around $100 on each xbox sold. They had to match PS2 pricing even though they had features like network card, hard drive. But the idea was to make up for that loss on sales of the games. I think it worked great but can only be tried by companies with huge cash reserves.

Can you find what's offensive?

2008-05-28T23:55:00.000-07:00

Sometimes I really think our country is in this mode of being too hypersensitive about any potential perceived offensiveness in any advertisement. How far are we supposed to go as marketers to ensure that nobody could ever be offended by something in an advertisement? How much resources do you have to spend towards ensuring everything is 'clean'? I'm all for doing a minimum amount of research into other cultures, languages, etc. to see how your message could be interpreted. However, in general I think the hypersensitivity of things that could potentially be offensive is getting a little out of control in recent years.

Could you spot what's offensive by just looking at the picture alone (given you haven't already heard about this story yet)?

Rebates - its one fact of pricing strategy

2008-05-28T20:58:00.000-07:00

During class this evening there was lot of discussion on rebates. Whether we like them or not they are part of the pricing strategy manufactures use to "push" their products. I came across an article that you may find useful (sorry it is lengthy) - http://www.cba.ufl.edu/mkt/docs/janiszewski/Rebate.pdf

As a Marketing Manager I have successfully used rebates in the past to promote a product, and yes sales during the period the rebate was offered did increase by 12%. One may argue if the increase in sales was directly related to rebate or other factors? Yes, most of the incremental increase was directly attributed to the rebate.

Happy reading

Is Customer Service Part of Marketing

2008-05-28T20:31:00.000-07:00

If is not it certainly should be!

These companies I would guess do not have and empowered CMO's. One would also surmise that the CMO is shouldering at least some of the responsibility. As you read the article click on the link for the best 25 companies at customer service. You will notice that good and the bad can come from like industries.

All the revenue comes from our customers and I once read that a bad service experience gets told to 11 people on average while good service get passed on only once.

Should the org-chart have customer service under marketing? I would like to read others thoughts on this subject.

Marketing and Sales

2008-05-28T16:41:00.001-07:00

How much does marketing really matter?

Maybe that's a terrible way to begin a blog for a marketing class, but I find myself struggling at my small company with making marketing relevant to the sales process. Even when marketing conducts research and analysis that resultsin very specific, targeted plans, the sales force may veer off in an entirely different direction. Obviously that's partly a management issue, but it's also a challenge that I think marketers should be willing to take up to further the strategic advantage of the company as a whole.

It's also a challenge for our MBA program. By definition we have few (or no) people who are in a purely sales role participating in the program because of the travel requirements of their jobs. To better integrate the roles of sales and marketing in my company I think that my marketing programs need to be more tactical and less strategic. Strategy still plays a role, but a gut feeling for effective strategies develops with time, experience, and observation of what sales processes do and don't work.

Over the course of a year and a half I think that I've been able to educate my management chain (VP of Sales) about the role of marketing, how it supports sales, and how it must be fundamentally have a more long-term focus than quarterly sales numbers. How do other people reconcile the conflicting agendas of marketing and sales at their companies?

Should firm focus on WOMM?

2008-05-28T13:37:00.001-07:00

Practically every business person or an entrepreneur knows the importance of word of mouth marketing secrets. Talk about B2B or B2C platform, the usability experience is always shared by individuals. The company can improve its lead by providing better customer service to their customers. The customers share their experience with friends and peers around. This advertisement is most advantageous than other marketing techniques.

Advertising Kudos to Microsoft

2008-05-28T12:19:00.001-07:00

Some entertaining ads fail to ingrain the product or brand into memory. I think MS succeeded at both missions with this ad for their entertainment title, Flight Simulator.

Have Film For Free...or Kinda

2008-05-28T11:31:00.000-07:00

NPR reported that former Disney main-guy, Michael Eisner, is producing 2 minute videos to download for free. At least the first 50 in the series. If you want the rest of the story there is a price.

Videos for sale is nothing new, but the model he is following is the same one Doug and I got to explore with music downloads: selling direct to the customer via download. Customer gets to try it and see if they like it. If so, order on. If not, no investment from consumer's pocket is lost.

I am left with the impression that there are dollar signs in Eisner's eyes - he sees this as a huge opportunity to get big money, big talent, big distribution - reach and in cost savings, big production cost savings.

Releases soon - interesting to see how it goes.

You can listen to an installment here.

I'll Take the Purple Pill, Please

2008-05-28T10:11:00.003-07:00

I happened to be in that psuedo-invisible position at my doctor's office: that time when she stands in the doorway talking admin stuff with staff before turning her attentions to me. She said something that really caught my attention. With visible exasperation she said, "If I hear one more color-pill request I'll scream."

I decided to ask what she was talking about. She explained that a patient had just requested 'those yellow pills'. She said that since the drug companies have been marketing to the patient - they used to market to the doctors - she gets color-coded pill requests every week. She attributes it to a pain killer in the 80s advertised as 'Little, Yellow, Different' and 'The Purple Pill' ads. The ads worked, but she says now she hears about green, purple, yellow, red and orange pills that the patient wants her to prescribe. Problem is that they get the colors confused.

I had never thought about the confusion that might occur as patients try to convey what they want using the 'ad lingo' rather than specific drug names.

Next step is the polka-dot pill - stay away from colors all together.

Let's Refuel a Brand: Chrysler's $2.99 Gas Guarantee

2008-05-27T22:58:00.000-07:00

I'm sure you've all seen a commmercial or two lately that mentioned Chrysler's new marketing campaign: "Let's Refuel America". Buy any new vehicle and Chrysler will give you a gas card linked to your Visa keeping gas at $2.99 a gallon for three years. My first thought, after filling up at $4 a gallon, was that Chrysler was willing to eat a lot of money to make sales volumes.

On closer examination, this is really a very clever incentive program. Whereas automakers typically give up the farm by offering hefty cash rebates or 0% financing to sell cars, Chrysler is betting gas will stay at a reasonable range (below $5) for three years and actually keeping more profit than it would with financing and rebate programs.

And they're targeting an area where they currently perform quite poorly. Gas prices are everywhere in the news, everybody is unhappy about the cost to fill up their cars, and Chrysler only offers gas guzzlers that no one wants. Even with traditional incentives, the first thing most consumers will be looking at in May is gas mileage. Since it will take a couple of years to get some new vehicles down the pipeline, Chrysler can direct attention away from the gas mileage of its current lineup and say, "but you'll only be paying $2.99 a gallon."

I just think it's a great experiment to take what consumers percieve as one of your greatest weaknesses, poor mileage, and morph it into a strength. They've managed to associate themselves with an issue that's recieving huge nationwide attention. By "doing something" about high gas prices, they may have rapidly entered consideration sets they never would have been in. And if consumers go for it, they'll make more money than on traditional incentives. Here are some early results.

Game marketing

2008-05-27T15:36:00.000-07:00

Until recently game marketing resonated with only the in-game ads in my mind. But when I started to understand digital marketing better, I was fascinated by the kind of options that the game marketers have in recent years. I think it all started with a change in perception that gamers are not just typical teen/young male anymore but
it does include both genders and varying age group. Refer the picture embedded in this article (source: "Why game marketing matters?" article from Forrester research) to know about Game marketer's choices.
Clearly there are more options, increased marketing budgets and an increased adoption to try out new emerging techniques in marketing. Check out http://www.postopia.com for instance. This is a gaming website targeted to promote all products sold by Kraft. ALso, surveys indicate that lesser consumers are annoyed (35%) by gaming ads compared to online ads( 85% annoyed). Also they have indicated they might consider the advertised while shopping.

I know we have some ardent gamers in our class. What are thoughts on how this type of marketing will shape up. Do you get annoyed with in-game ads?

Mobile Marketing

2008-05-27T11:42:00.000-07:00

I recently read this article talking about how some companies are targeting iPhone users with 'right-sized' websites and advertisements that better fit its 3.5" screen. Next month, Apple will be releasing a software development kit for the iPhone, enabling external developers to create custom software and potentially shape advertisements through 'geo-targeting,' based on user's GPS coordinates. Should marketer's be required to get user consent before placing geo-targeted ads?

Marketing your stock

2008-05-26T19:33:00.000-07:00

Not the best way to market your stock:

Two years ago we were selling at 10 times revenues when we were at $64. At 10 times revenues, to give you a 10-year payback, I have to pay you 100% of revenues for 10 straight years in dividends. That assumes I can get that by my shareholders. That assumes I have zero cost of goods sold, which is very hard for a computer company. That assumes zero expenses, which is really hard with 39,000 employees. That assumes I pay no taxes, which is very hard. And that assumes you pay no taxes on your dividends, which is kind of illegal. And that assumes that with zero R&D for the next 10 years, I can maintain the current revenue run rate. Now, having done that, would any of you like to buy my stock at $64? Do you realize how ridiculous those basic assumptions are? You don't need any transparency. You don't need any footnotes. What were you thinking?
Scott McNealy, CEO of Sun Microsystems, Business Week, April 2002.

Microsoft's Cashback Program: Marketing Genius or Gimmick?

2008-05-26T10:39:00.000-07:00

Last Wednesday, Microsoft unveiled its Live Search Cashback program, it's latest attempt to increase Live Search's market share. Consumers can shop for products using this feature, and then compare prices from all featured retailers. Whatever discounts are offered will go directly from the retailer into a cashback account that the consumer can redeem. Here's another description of the program.
While this is a clever way to increase brand awareness for the search engine, it also may prove to be a more efficient marketing tool for retailers. Rather than paying per click, retailers will only pay per action, when consumers actually buy something. This could be a marketing win-win situation for both Microsoft's search engine and its featured retailers.
But will consumers enjoy this feature, or will it be too complex? The cashback can't be redeemed until 60 days after the purchase, and it depends on the retailers offering their best price. For example, I found my Canon SD750 digital camera for $199, or $189 after cashback from Circuit City using the Live Search program. But I could have gotten it for $179 direct from Circuit City's website. How does this make my shopping experience easier?

The Power of Marketing

2008-05-26T09:49:00.000-07:00

The ‘standard’ Economic model posits that price is defined by the intersection of supply and demand. In statistics, consumer spending was shown to have increased such that consumer spending is now greater then consumer income. Therefore, because buying power hasn’t decreased and rewards for saving are mostly constant, it appears consumer demand has increased. Are there ‘better’ things to spend money on or has the US cultural perspective changed?

Specifically, what are the effects of marketing on US culture and on savings trends? What is the impact on the economy and national productivity? Considering the number of hours/week that the average US youth spends in front of the television and surfing the internet how will marketing effect their future purchasing/savings decisions?

Thanks,
Eric

Nordstrom's in the news

2008-05-23T15:20:00.000-07:00

According to the times, Nordstroms is about to start an online buying service, but you'll pick up your items in the store. That's a pretty interesting idea. One may suppose the point is to avoid losing the opportunity to deliver the famous Nordstrom "service", which is quite legitimately part of their brand. Once Nordy's stuff is delivered by mail, its not easy to maintain that brand over any other internet store. However, why bother at all? Clearly, Nordies doesn't want to lose a sale to someone who shops on-line.

I look forward to how this pans out. I don't know anyone who shops on-line for convenience, and likes the idea of having to provide their own transport for the goods after the sale. The mail is simply the most convenient method for me to receive my goods. I would think the shopping experience itself is an important time for enjoying Norstrom's branded service.

http://seattletimes.nwsource.com/html/businesstechnology/2004427084_nordstrom21.html

Bob B

Cell Phone Ads...Influence in the Pocket?

2008-05-23T06:19:00.000-07:00

During the class presentation on marketing through cell phone ads (e.g. alerts of nearby fast food restaurants) the point was raised that some consumers view this form of advertising as intrusive.

An issue that has been on my mind with this and for that matter all types of marketing is the degree to which certain, specific, strategies may annoy the customer.

Question:
If you had to wait 10 seconds for a Burger King ad (on your cell phone) when trying to make a call on your cell phone, would you be annoyed? (Maybe a lower cell phone bill might help to render this)?

Anyway, the effects on our view of burger king are at least 2-fold:
1. Burger King is on our mind (good for Burger King)
2. Burger King and feeling annoyed coincide (‘Pavlovian bad’ for Burger King).

Is effect 2 relevant? Should marketers consider this? Is it ok for Burger King but more of a problem for higher-end establishments? (i.e. Is this uniquely appropriate given the addictive nature of french-fries and a Whopper (for some customers))? Could this type of advertising push some consumers over the edge (‘I can’t quit BK!’)?

Thanks,
Eric

Chief brand officer

2008-05-22T16:39:00.000-07:00

Off late, I run into companies announcing their new CBOs. Wasn't this always part of a chief marketing officer's role who along with driving all marketing initiatives also took care of promoting the brand? I'm starting to wonder whether its a byproduct of title inflations ( chief xyz officers like diversity officer, cultural officer etc) or a genuinely required title to have more focus on promoting a company brand?

Does your company have a CBO? If yes, do you also have marketing officers? continuing on our discussions from yesterday's class, do you see them hands on at the trade shows evangelizing the brand and listening to customers?

Open Source as a form of branding?

2008-05-22T13:23:00.000-07:00

It occurred to me that Open Source software is a form of branding. People tend to have certain associations with the label "open source" similar to the associations that are carried with a brand.

In the case of open source software, these associations might be positive or negative, things like "free", "flexible", "hard to use", "unsupported", "community supported", "dynamic and growing", "unstable", "secure", etc. These associations are contrasted with associations that people might have about commercial software, like "supported", "easy to install/use", "greedy", "unresponsive", etc. Commercial software companies recognize this, and try to strengthen the perception of their brand vs. the open-source "brand".

What do you all think of this?

I did a bit of research, and came across something entirely different:

http://www.trendwatching.com/about/inmedia/articles/insperiences/open_source_branding_invite_cu.html

Apparently some people are promoting open-source brands, in which consumers help define the brand image itself. Interesting stuff.

Kobe and Aston Martin Ad - Part 2

2008-05-21T23:06:00.001-07:00

This is a spoof and parody to the Kobe/Aston Martin ad.

The original ad was a huge hit. Even the Air Jordans don’t come close.

This is one of the finest examples of viral marketing at its best – low cost (this has to be the lowest cost for a Nike ad EVER), buzz worthy, entertaining and SUPER effective. Since the ad went live in late March, it generated more than 20 million views on YouTube alone. Just the sheer number of spoofs and parodies alone have valided the success. Simply WOW....

Using YouTube as the distribution channel, it opens up a world of opportunities for viral marketing.

Here’s another spoof while we are at it.

Why don't I buy store brands

2008-05-21T18:16:00.000-07:00

We were discussing branding the other day and one of the things that hit me is the fact that I never buy store brands. The natural question I get to is "why?". The answer, I have absolutely no idea. On Sunday, while in Safeway I see two cans of corn, a store brand and a national brand. I immediately grabbed the national brand, but having thought about this some this week I bought the store brand which was cheaper. Turns out the store brand tastes exactly the same. Problem is, even with this knowledge I really don't intend to buy it again.

I stumbled across an article I thought I'd share on why store brands don't do quite so well. It seems I suffer from Issue #1 in the article. As it turns out I'm not the only one who discriminates against store brands. With my new found awareness I suppose I should work on overcoming that prejudice and seek out the objective truth. http://findarticles.com/p/articles/mi_m0YQW/is_2000_Sept/ai_65227364/pg_1

Subliminal marketing

2008-05-21T13:08:00.000-07:00

I was talking to my co-worker who happened to notice a subliminal message in a recent KFC ad. A $1 bill was nicely camouflaged in the KFC snacker. Sure enough I checked on Youtube and I found this : http://www.youtube.com/watch?v=MunPARnI0dE

It makes me wonder whether such subliminal ads are really effective?

I looked up for some more information on companies who do such subliminal ads and KFC seems to be the one who had consistently done that.

"KFC is stepping it up a notch and actually providing an incentive for people to seek out the ad, offering a free sandwich to those who can regurgitate the hidden phrase. Imagine that: there may soon be a day when we record shows not because we enjoy them, but because advertisers have told us that they'll give us free swag if we comply." source :
http://www.engadget.com/2006/02/23/kfc-leverages-dvr-time-shifting-to-its-advantage/

Many marketers explicitly deny placing subliminal ads and television networks reject such ads when they promptly notice them. For example, ABC network had stopped airing ads that they considered had subliminal messaging.

These ads create enough stir ( especially when mixed with sex ingredient ) that its been followed by avid readers and may be the marketers have succeeded getting attention. But on the other hand, why would you want to bury a hidden message and have the networks ban your ads?

I'm curious to know what your thoughts are on this type of marketing practice.

How effective is branding in Auto Insurance industry?

2008-05-21T12:04:00.000-07:00

Consumers want better paid claim processes, good rates, easy to understand policies and company's financial comfort to get attracted in the Insurance Industry. According to the brand equity study on Insurance Industry "Less than five people indicated that their insurance industry has never disappointed them". Geico, a well known auto insurance company has a message which claims that consumers can save 15% or more on their car insurance. I recently switched my auto insurance to All-State because of better rates. Car Rental companies take insurance from the cheapest carrier. It seems that auto insurance industries are more driven by price and rates and branding has lesser impact.

What do you think?

SNL takeoff on NBA playoff ad.

2008-05-21T08:33:00.001-07:00

Powerpoint Presentations vs. Hand On Demo

2008-05-21T02:03:00.000-07:00

Earlier today John posted on entry entitled "Presentations". Reading reminded of the marketing activities of Caterpillar. Several years ago, okay many, I was one of several people to represent my company on a 1 week tour of the Caterpillar facilities in Illinois. I was one of about 300 people in attendance, visiting their various factories, listening to presentations, round table discussions, etc. Caterpillar hosted this event twice a year and between them and the franchisees paid the full expense of all attendees. We were catered to very well. The mix if people were existing Cat owners and potential owners. All of these years later, I still remember the trip and access that we had to engineers and designers.
From the marketing perspective, that is exactly the impact that I would want to make to customers – long lasting first class impressions. When, I think of construction equipment CAT is at the top of the list (TOMA exercise). Did the trip (marketing tool) bias me? No. I already like many of their products from firsthand experience. Did it reinforce my belief in the product quality or loyalty? Yes. For the largest construction equipment the market is limited and one needs to retain the customers. I also see similarities in the aircraft industry.
A Hands On viewing or demo of a product versus a PowerPoint only presentation is priceless or at least worth it’s weight in gold.

How Entertaining/Annoying!

2008-05-20T22:16:00.000-07:00

My son asked me about that "great" commercial they showed during the superbowl. He said that he didn't know who the advertiser was, but described the commercial and said, "oh, come on, Mom, you have to know it - everyone knows it. I think its about money. Like a bank or something." He wanted to find it on YouTube.

So I proceeded with a highly unscientific research project. I asked 16 people (co-workers, barista, parking lot garage gate keeper, friends, and stranger in elevator) all could tell me about the commercial but only one could tell me it was an e*trade commercial.

So were is the line between being entertaining and really getting your name out there?

How about the AFLAC duck commercials? I don't really know how that bird helped the profits of AFLAC, but I know I am not the only one who found them entirely annoying. But I bet you'd have a hard time finding someone who didn't know what company was being represented in those ads.

Entertaining or Annoying...hmmm. Which works best?

Quiet Promotion

2008-05-20T21:08:00.000-07:00

One Emory University English Professor believes the sales total that Grand Theft Auto IV has achieved is one of the top eight indicators that the younger generation is in peril. Regardless if you believe this assertion or not, the sales that Take-Two Interactive Software and Rockstar Games were able to achieve should cause everyone to take notice of the marking techniques they put into action.

By forgoing the typical marking blitz and keeping tightlipped about the gameplay details, the publishers were able to build a tremendous amount of hype amongst gamers without raising too much attention from the non-gaming community. It also allowed the publisher to maintain a tight level of control of the message that they wanted to convey. Some of the advertising techniques used by the game’s publisher mentioned in this article were:

Building Murals
Wanted Posters
Viral Videos
Bus Wraps

Are there any other products that come to mind that have used subtle or quiet promotion to build hype?

The one that jumped into my head was for the Aqua Teen Hunger Force movie, and that campaign did not work out nearly as well as GTA IV’s promotion…

coproate v/s individual branding

2008-05-20T14:03:00.000-07:00

Yum Brands own KFC, Taco Bells, Long John Silver's and Pizza Hut (http://www.yum.com/about/brands.asp). But common people do not know Yum Brands as a company. Whereas they use this individual branding strategy, firms such as Apple and Kellogg use corporate branding where every product is sold with the corporate brand tag (corporate branding). Which of these branding strategies is better? Corporate branding has advantages that it enables more efficient communication to consumers, employees, investors and channel partners. But it is also risky. If one product fails, it carries its effect on all the other products. For e.g. if next Apple iPhone version is a technological failure then people will shun all the Apple products. But when rats were spotted in Taco Bells kitchen in NYC, people did not think twice while going to Pizza Hut. So, which strategy rules?

Kobe Bryant + Aston Martin = Marketing, Hollywood Style

2008-05-20T12:42:00.000-07:00

In Hollywood, anything is possible; expect the unexpected as some might say.

Riding on Kobe’s ascension to the top, Nike has unveiled its new Hyperdunk basketball shoe endorsed by Kobe which will be launched in July. To generate buzz surrounding the new product, Nike enlisted help from Aston Martin to create a tag team that we haven’t seen since the last James Bond movie.

This video has Kobe sporting his latest gear and attempting to jump over a Aston Martin that is directly driving towards him. In real life, this is not only very risky but almost humanly impossible. In true Hollywood fashion, this is made possible by using special effects and camera techniques.

The commercial was released in April (online only) and since then became THE topic among basketball fans around the world. This brings us to the subject – What does this have to do with marketing.

Viral marketing is a term coined by a Harvard professor in 1996 to define marketing techniques that use pre-existing social networks to produce increases in brand awareness or to achieve other marketing objectives (such as product sales) through self-replicating viral processes, analogous to the spread of pathological and computer viruses. It can be word-of-mouth delivered or enhanced by the network effects of the Internet.

This ad was one of the most watched videos on the internet during the initial release. Hoops forum/websites, ESPN, sports radios were flooded with thousands of threads and responses.

Kudos to Nike: this is a winner.

P.S. – YouTube is now part of Google, can you imagine all the possibilities and potentials? If you find another company that is more destined to become the world’s first $1 trillion company, let me know.

Presentations

2008-05-20T09:32:00.000-07:00

Preparing for an article presentation in class I was trying to think of ways to be a cut above the crowd and keep the audience engaged. I found this article about presentations and thought what a great topic for the marketing blog. I also thought how all of us including professors always commit at least one of these deadly sins! Of course that's my opinion, sorry if you disagree.

One of the more recent complaints from sales people I have witnessed is the customer reluctance to sit through a presentation about a product or service. I quote from a engineer' "Don't come with a power point presentation" in a recent appointment setting scenario in an attempt to demonstrate the features and benefits of a product.

Most power point presentations are owner/presenter developed (no fact in statement just a guess) and authored except for corporate logo and or image requirements. Should the marketing group or person with ownership of a product or service be strictly responsible for the presentation content and appearance beginning to end?

Do You Know the Brawny Man?

2008-05-19T20:28:00.000-07:00

For years the brawny man has had blonde hair, a blue plaid shirt and a mustache. But not anymore... the new improved brawny man was released last October. The new brawny man is clean shaven, dimpled and has dark hair. Do you think the new brawny man will affect the selling of the paper towels? Some articles have speculated that the new image will lead people to believe that the paper towel itself has also been improved...What do you think?

Can a Dead Brand Live Again?

2008-05-19T17:43:00.001-07:00

I thought this article in the NY Times was a pretty interesting (if long) look at branding.

They look at the idea that defunct brands can still hold a lot of customer mindshare and, therefore, can be valuable to start re-using. The use the example of Brim coffee.

Branding Changes

2008-05-19T10:05:00.002-07:00

An example of how is it done?
In the late seventies and early eighties Black and Decker to compete against Craftsman aligned itself with the discount department stores for hand tools of the electric variety. By the nineties these hand tools suffered from a poor quality image. While sales were still handsome because of the distribution network, image deterioration was allowing Craftsman and others to erode B&D's market share.
B&D in an excellent example of re-branding built a new brand/image for this product line. That product line and it's managers disassociated anything B&D. Can anyone name the new brand that typically is carries the highest price tag?

More on Starbucks

2008-05-19T09:31:00.001-07:00

So, if you're branded as 'the latest' or the newest trend or whatever, isn't that a self-limiting strategy? At some point, doesn't the latest thing eventually become yesterday's news, as it were? And if Starbucks has indeed no longer hip&fashionable, does that indicate they are on a 15 to 20 year slide before they are cool again? Are shareholders willing to hold their stock that long, in the hopes that they see themselves once again cool? Like the 80s are to the kids these days?

Impact of generic Branding

2008-05-18T21:45:00.000-07:00

The late 1990s and 2000s saw the emergence of the generic branding where retailers started selling generic goods under a store created brand. Some examples include the generics in grocery stores like Kroger brand, or the clothing lines by JC Penny called “Arizona” and “St. John’s Bay”. These brands are given better shelf place and more advertisement since they potentially generate higher margins for the retailers. In recent years, the quality of such generics has also improved, especially in clothing, to match designer brands.

This potentially drives the price down for the designers since they have to negotiate harder with the retailers for shelf space, and do more promotions. Ultimately, economics dictates that the pricing between branded goods and generics will get close enough to not be significant. Therefore, people can then choose to purchase designer brand goods again since they are cheaper. This will end up eventually hurting the retailer since sales of generic brands could decrease. So, is this strategy of generic branding good and viable?

The Cadillac rebranding

2008-05-18T09:18:00.000-07:00

Who remembers when Cadillac’s demographic market was to your grandfather? For most of Cadillac’s history, their brand sold to the older more affluent age group. Apparently, that market has died off and Cadillac is in search of greener pastures.

I think one of the best tag lines I have ever heard is the new Cadillac motto, “when you turn your car on, does it return the favor”. That sends a clear message that the Cadillac brand is no longer for your grandfather. The transformation of the Cadillac brand into a younger, sleeker, sexier model is an example of a bold rebranding. It must have been quite a shock to Cadillac’s original demographics to wonder into a dealership and find the DTS or the CTS. Certainly not the type of models you would want your grandmothers driving or were they accustomed to driving.

However, all this rebranding has paid off for Cadillac because the CTS won the 2008 Motor Trend Car of the year, something a car out of Detroit hasn’t done in a while. Cadillac is quoted as saying, “The CTS obliterates the ‘old man' image of Cadillac”, and it appears it has. Now the only question I have is, what is my grandmother suppose to drive?

Alka Seltzer advertisements seemed to peter out

2008-05-17T11:50:00.002-07:00

At one point Alka Seltzer advertised creatively and heavily..they drove the "that's a spicy meatbal" phrase into the lexicon, but the art within their marketing was quite amazing. Today, I don't see any ads. That's interesting, once you advertise, you can back off?

My favorite ad:

Re-Branding: true value or "pulling a fast one"?

2008-05-16T11:00:00.002-07:00

I want to pose a question that was haunting me through the entire class on re-branding. We’ve covered re-branding in relation to mergers, acquisitions, etc., but no one spoke about re-branding in order to change a negative customer perception while changing nothing in the way the company does business. In my experience, about 80% of re-branding happens simply because the company wants to be called something else, to have a new logo, and hopefully, granted temporarily, convince its customer that they are better. Unfortunately, what I don’t see is the change in the actual quality of the product or service; at least to the average consumer (there are always exceptions for the large accounts and squeaky wheels). This, in my mind, makes re-branding “an empty gesture”, an attempt to create perceived value without any sustainable way of maintaining it. So are the majority of re-branding efforts really are “pulling a fast one over your customer” [I want an opinion from your experience] or am I missing something?

Alex

Is a brand worth thinking about if nobody sees it?

2008-05-15T20:16:00.001-07:00

My Ladyfriend/partner/mate has her own business, see http://www.vickiscuri-siteworks.com/. This is a sole-proprietership, one person business she's run out of our home for 10 years. Its a fine business with capacity limited to her own capacity, and she's worked at her limit for many years. She has business through word of mouth, and has never advertised. We have no idea if her website has ever made a difference, we've only seen a rare interest from the web, and none of these queries have ever resulted in a contract. Does anyone think branding makes a difference in this case?

I am still seeing "brand strength" as a different way to discuss how the marketplace views your offering, and its usefullness as a concept is rendered quite unimportant in a scaled down situation in which connections are personal.

Bob Bernstein

More brand discussion

2008-05-15T14:16:00.001-07:00

I came across an interesting article, "Why Weird Words Make Great Brand Names," on ezinearticles.com. Not only did this article have interesting commentary on branding like the following excerpt...

Most of the feedback takes the form of free associations, all in an effort to determine if a name is “good” or “bad.” It goes something like this…

Interviewer: “What do you think of the name Monster?”Respondent: “Ew! They’re scary and dangerous!”

Interviewer: “What about Amazon?” Respondent: “Jungle… drowning… snakes… piranhas…”

Interviewer: “Apple?”Respondent: “A bad apple spoils the whole bunch.”

Interviewer: “Caterpillar?”Respondent: “Squishy, soft, and squirmy.”

Interviewer to new business owner: “I think we can safely assume these would be bad brand names…”

...the site also has lots of additional articles on branding. How to approach it. What not to do. The politics of branding, etc. If this topic interests you, check out this article and more.

http://ezinearticles.com/?Why-Weird-Words-Make-Great-Brand-Names&id=177974

The Dumbest Generation.

2008-05-15T11:47:00.000-07:00

An Emory University English professor has written a provocative book titled "The Dumbest Generation." The Boston Globe has a great summary of his eight chief arguments-
1. They make excellent "Jaywalking'' targets.
2. They don't read books -- and don't want to, either.
3. They can't spell.
4. They get ridiculed for original thought, good writing.
5. Grand Theft Auto IV, etc.
6. They don't store the information.
7. Because their teachers don't tell them so.
8. Because they're young.

Marketing, Advertising, PR, and Branding

2008-05-15T10:20:00.002-07:00

I thought this was pretty amusing (and timely, given our recent branding discussion).

Though it's obviously not meant to be a profound statement on branding, one can certainly make certain observations based on it.

Perhaps advertising is the delivery of a marketing message, whereas branding is customers' perceptions of your product/company? In that model, a strong brand is clearly desirable (people may resist advertising, but branding is internalized). Good advertising/PR is important because it can influence brand quality/image.

Anyhow, I chuckle at the image; figured I'd share it. :)

What the Pho and Pho Shizzle? Pun Branding Sells

2008-05-15T08:26:00.000-07:00

I can’t stop laughing when I first saw the name of these two restaurants. Pho is a Vietnamese soup noodle dish served with thin cuts of beef, meat balls and other ingredients.

Needless to say What the Pho has a comic effect. The word Shizzle is a hip hop slang that is known as the "Snoop speak" because it was popularized by rapper Snoop Dogg.

What the Pho is actually a local restaurant in Bellevue. It’s been around for a while and due to its popularity, a 2nd restaurant opened in the Bothell area in 2007.

The owners are using malapropism and bilingual pun to take full advantage of the word “pho”. This is a cleaver tactic to brand a product based on a concept called sly or pun marketing. A good example of a bilingual pun comes from names, for instance, Sum Ting Wong – a name in Chinese that is not unusual.

According to Wikipedia:

A bilingual pun is a pun in which a word in one language is similar to a word in another language. Typically, use of bilingual puns results in in-jokes, since there is often a very small overlap between speakers of the two languages. Occasionally, some puns are more actually malapropisms - a malapropism is the incorrect use of a word by substituting a similar-sounding word with different meaning, usually with comic effect.

The use of the pun/malapropism is a pretty cleaver marketing technique to exploit cultural differences. This is s very un-traditional way to market a brand or product (thinking outside the box) and I am seeing more and more usage of this technique in marketing. There’s no formal definition for it at the moment (I can see why) . But as we know it, the world is becoming more and more flat, we are all very well versed in our cultural/ethnic differences – the potential to use this technique effectively has huge potentials.

Got a similar brand or marketing experience from your culture or in general? Please share them.

Microsoft and Branding

2008-05-15T00:28:00.001-07:00

This spoof video makes a good point relative to our discussion this evening, even though it focuses on packaging:

Starbucks = 'Slutbucks'?

2008-05-14T22:24:00.000-07:00

On the evening news today, there was a story about a Christian group boycotting Starbucks based on coffee shop's new logo. The new image (below) is very similiar to its original mermaid logo when the first store opened in Pike Place Market.

The group says:

"The Starbucks logo has a naked woman on it with her legs spread like a prostitute," explains Mark Dice, founder of the group. "Need I say more? It's extremely poor taste, and the company might as well call themselves, Slutbucks."

I personally didn't find the ad all that offensive, but maybe other's do?

Is anyone highly offended by this ad?

Brands that define an entire product industry.

2008-05-13T07:37:00.000-07:00

What kind of advantage is held by branded products that become the representative brand that all products in that industry are associated with? I began to think about this as I was watching people order drinks at a wedding. I thought about how people would order a rum & Coke, or 7 & 7 (for you non-drinking folks that would be Seagram’s 7 whiskey and 7-Up) rather than use the generic terms, rum & cola or whiskey and lemon-lime soda, although to be fair on the last one it’s a lot easier to just say 7 & 7. At this particular event I noticed that several of the alcohol brands used were not those requested by name, basically because there was only a limited alcohol selection. There was no Seagram’s 7, and another Canadian whiskey was being substituted without question. But it goes beyond the alcohol, I didn’t ask about the brands of soda but the bartenders could easily have been substituting Pepsi instead of Coke or Sprite rather than 7-Up.
Based on this initial thought I made a mental leap and began to think about products that are identified by a brand name rather than generic description. A perfect example is Kleenex, because no one I know says they need to buy facial tissues, they go to buy Kleenex. Not that there aren’t some reasonably well known competitors, Puffs for instance. But what kind of advantage do products like Kleenex, Band-Aid, or Q-Tip derive from being the brand that is in effect the industry standard? While I haven’t done any deeper research on this (yet) it would seem to me that these representative brands have a significant advantage over the competition based on name alone.
Obviously there are those consumers who could care less about brand names and go with whatever is cheapest or with another brand they prefer more. But regardless of that, I bet they still use the representative brand when referring to the product in general. Rum & Pepsi… it just doesn’t sound the same.

Marketing for the bad guys?

2008-05-12T19:53:00.000-07:00

I sincerely believe that most of us want to believe that we’re good people. Most of us hold respectable jobs, with respectable firms, and bring home an honest paycheck. We use that money to pay our fair share of taxes, make payments on our mortgage, and save money towards our retirement. At night, we kiss our children, tuck them into their beds, and then get a good night sleep before going to work and doing it all over again the next day.

However, we’re also aware of that other element that is out there. The “bad guys”. The people that prey on the suffering of others to bring in their income. Among the most insidious of these are the people in the drug cartels and the dealers that distribute their product. Recently, a new trend has developed in the marketing of drugs: Fruit flavored cocaine has begun to surface in recent drug busts.

The question is: Who is this being marketed to? The answer is obvious; they are marketing this product to the very children we tuck into bed. As stated in the article:

“The case comes as authorities were already wrestling with the emergence last year of pink, strawberry-flavored crystal methamphetamine, which hit the streets in California in early 2007 and has since spread as far east as Virginia, where state police seized a pound of the drug three weeks ago in the small town of Galax.

‘Meth has sort of a bitter, nasty taste, so it’s kind of easy for the young kids to get into this,’ said Henry Spiller, director of the Kentucky Regional Poison Center in Louisville. ‘It’s an effort to make meth more appealing.’” [1]

This begs another question: Who came up with the marketing strategy? Who determined the idea that this might be the demographic that should be targeted? Considering that cartels already employ a large number of other professionals on their staff for distribution, transportation, even accounting and legal resources, is it so hard to believe that they don’t have someone with a marketing background on their staff?

While few, if any, of us could imagine taking money from a criminal enterprise like this, ultimately someone will. The question is whether this is someone who is holding an MBA or someone just trying something new in the market on a hit-and-miss basis. Frighteningly, this particular case smacks of the former.

[1] MS-NBC. Sniffing out a fruit-flavored trend in cocaine. April 17, 2008. Retrieved from http://www.msnbc.msn.com/id/24018918/ on April 28, 2008.

Do you think you’re turning Japanese-a, think you’re turn Japanese-a, you really think so?

2008-05-12T19:09:00.000-07:00

Even though the song by the Vapors came out in the early 80’s, there may be something to the sentiment: Somehow, the Japanese culture has found a way to enmesh itself in the culture that has been most successful in exporting its own culture throughout the globe.

While it’s true the culture of the United States has always been an amalgam of every other global culture, there is something about the Japanese culture that is particularly marketable. However, as the referenced article is very good at pointing out, it’s not a “pure” Japanese culture that is being sought out by the American consumer:

"What is interesting about [businesses] that have been successful [selling Japanese products] is they're not going to Japan and seeing what's hot in Japan right now," Kelts says. "They're keeping a very firm grasp on what their American customers would like. So I think respecting the cultural differences is still important. It's not exactly localization. They're not changing the products to suit the American customer. They're just selectively offering Americans what might work here." [1]

Simply put, even if it is Japanese culture that is being sold to the United States, it’s only those aspects of the culture that Western values will embrace and accept. A good example of something that is commonly accepted in Japanese culture that wouldn’t be accepted in the United States would be the typical cartoon targeted to school-age children in Japan. During one trip to Tokyo, I recall turning on the television and immediately being immersed in a cartoon that would have given the FCC a collective coronary!

The cartoon had no problem showing full frontal nudity, anatomically-correct graphic violence, and implied that even younger children could have a blushing sexual streak to them. I could not even imagine this same cartoon being on HBO, much less in the middle of the afternoon, right after school hours. Western values would never accept this.

So are Americans really buying Japanese culture? I would conclude the only place it seems that other cultures are successfully marketable in the United States (even one as infectious as the Japanese culture) is when the aspect of the culture being marketed is one where Americans can see something of themselves in it.

[1] MS-NBC. Embracing Japanese pop culture. May 11, 2008. Retrieved from http://www.msnbc.msn.com/id/24546355/ on May 11,2008.

how to measure the performance of marketing strategy

2008-05-12T15:52:00.001-07:00

What is a good measure to evaluate the impact of a marketing strategy ?For example, does it make sense to increase the advertising budget? How will I know whether the increase in sales is due to this advertising and not because my competitor raised his prices? Sales is a bad measure of performance.
Can we link the effectiveness of marketing strategy to stock market returns of the company's stock? That way we get an objective measure of performance that is determined by the market and that is understandable to the finance managers who approve the marketing budgets.

Is blogging a new avenue to explore in Marketing ?

2008-05-12T12:16:00.001-07:00

These days businesses in every Industry need a website to endorse their products and services to make a presence in the world. Every industry is trying to use blogs to market their product. Especially, software industry has content writers who write blogs in context to their products and market them.

Creating business blogs provides interactive information to their customers and makes the firm a better communicator. Blogs are also effectively used by search engines to rate the product. Immediate listing of company's website on the search results highly increases the popularity of the product. Apart from advertisement, firms can also get direct feedback from the customers to enhance their product features. Real estate industries are using blogs to promote their website in the local search engines and get customers.

How essential would the concept of blogging be for small and mid sized companies and whether this viral marketing can be used effectively for large enterprise would be a great topic to discuss.

What do you think ?

Do you get it? Do you like it?

2008-05-11T23:41:00.002-07:00

OK, today, as part of the Mother's Day festivities (a joyful one, unlike the studying for the financial management midterm ;) ), I was clipping pictures from old magazines to make a collage with my kids. I ran into this ad and I really don't like it. Something about food in a place where my sweaty feet would be. It actually took me a second to even get it. Do you get it? Do you like it? You can click on the picture to see a bigger version.

Remember the AppleTV?

2008-05-11T22:15:00.000-07:00

(AppleTV: Multipurpose - Sushi platter, bet Jobs and co. didn't see this one coming)

Photo source: Fortune

When we talk about Apple, most of us will instantly recognize products such as iPhone, MacBook Air and of course, the iPod. But how many of you remember that Apple released a much hyped product in early 2007 called AppleTV.

Dubbed the “DVD Killer”, the AppleTV is supposed to usher in a new generation of entertainment and be the centerpiece to our living room. AppleTV promised to stream videos and multimedia contents from PCs through our wireless network and providing playback capabilities on HDTVs.

The strategy was simple – link all the killer apps from iPod to iTunes and create a happy medium to play the music, video, and pictures through the big-screen. The result however, was as bad as the Apple III.

Several factors why AppleTV failed to take off.

First, the device requires a HDMI (Hi-Def Multimedia Interface) connection but very few contents on iTunes produces HD quality videos. The result was a very bad combination of low resolution videos playing on a HD capability TV. This is almost like requiring a HDTV to play VHS tapes, not a happy marriage.

Second, AppleTV has streaming capabilities through our PCs and it also has a separate connection to the internet. However, users are not able to directly order contents via AppleTV and download the contents directly to the device. Instead, a PC is required to be the middleman doing a very non-value added and time consuming task.

Third, yes, it was dubbed as the “DVD killer” and so AppleTV chose to come without a DVD drive. Sure, from a differentiation perspective, it works, but how many of us are ready to shell out $300 to pay for another device that we don’t really need. I can spend $300 on a quality home theater entertainment system or the AppleTV and the decision won’t be the latter.

Fourth, AppleTV has a HD, 40 GB worth to be exact. You would think that it would be awesome to replace that old TiVo of yours and use the AppleTV to record television shows. WRONG. The AppleTV does not have any capabilities to record anything.

Finally, the AppleTV fails to compete with newer laptops who are HDMI capable. Why need another device when I can connect my laptop directly to the TV and play real HD contents without ever having to stream through the network.

In summary, AppleTV does have some nice features such as the signature design from Jobs and co, but it lacks the most fundamental features that even the most novice users would want. There will be lessons learned from AppleTV – so much for the DVD killer.

Multigenerational Marketing

2008-05-11T20:14:00.001-07:00

There are days when I think that there is really nothing new anymore. If you think about the number conversion of old tv shows into movies for the "new" generation it makes you wonder if people have really run out of good ideas lately.

The latest thing I noticed today is bringing back the horror flick of my past "Nightmare on Elm Street" from 1984 into today's generation of kids. The link on the title just makes me shake my head once again asking when can we get some decent new ideas going? What are the iconic shows/characters/films of today that we'll see 25 years from now? Is it taught in marketing somewhere to look up stuff from a generation ago and see how you can repackage it again for more bucks?

Apple 1984 Commercial

2008-05-10T16:10:00.000-07:00

Early in the quarter I put the Apple 1984 commercial (http://www.cnettv.com/9742-1_53-15243.html) forward as one of my favorite ads of all time. I was very suprised at the number of people in the class who had never seen this. Take a look and tell me what you think.

This commercial was incredibly effective because it leveraged a well-known association (George Orwell's 1984, which had been discussed endlessly in the media at that time, because the year 1984 was approaching/just starting) to portray Microsoft (and IBM I think) as purveyors of brainwashed conformity, and the Apple Macintosh (and by extension, those who bought it) as rebellious nonconformists.

Interestingly enough, in the book 1984 I believe the rebel group was actually a government front to indoctrinate/control all the people who didn't conform, to keep genuine dissent from arising. When Microsoft purchased a share in Apple and made agreements to cooperate in some areas, I couldn't help but think about the parallels.

(And no, this is not meant as a cheap shot at Microsoft).

Customer Loyalty & Pizza

2008-05-09T23:34:00.001-07:00

In timely coincidence, we were talking last week about customer loyalty and discussing this week top-of-mind and consideration of pizza joints. My family tends to alternate between Pizza Hut and Pagliaccis, because the kids like PH better and my hubby and I like Pagliacci's better. In the several years that we've been ordering pizza for delivery in our current home, on average we have probably been good for an order from one or the other once every ten days. Because we all like different toppings, this isn't the cheapest habit! Our typical order from Pizza Hut is $25-30 and our Pagliacci order is regularly over $32. Due to various reasons, when we placed our order with Pagliacci last week, it had probably been a good four months since we had last ordered from them. When the pizza order arrived (early and correct), I was surprised to hear what the delivery guy had to say - "This one is on us!" He then handed me a "Thanks!" card with several staff member's signatures. This was only the second time this happened in almost five years, but boy is it effective. I'm sure we'll only order Pag's for the next several orders, so it will pay off for them. They have made us loyal. After I tipped the man and closed the door. I thought to myself how there's probably no chance that Pizza Hut would ever do that, and how cool it was to have such nice surprise!

Do you see everything in ads?

2008-05-09T23:25:00.000-07:00

Effective advertising is memorable, in such a way that you remember what the advertiser wants you to remember (the product, service, brand, what-have-you). How vulnerable are you to having your attention directly diverted? Take the test!

Sex or insinuation of it sells? Real estate firms in Mukilteo thinks so.

2008-05-09T10:14:00.000-07:00

I was driving to Mukilteo the other day, and saw an interesting billboard off the side of the Mukilteo Highway. This board depicted 3 fairly attractive and “presentable” women, dressed in business suites, but with devilishly cute and, one might argue, promising smiles. Text right above them stated “. . .foursome required. . .”. If this isn’t an attempt to get more of the first-time, young buyers to come and see an “up-incoming and happening” housing complex, I don’t know what it is. Does sex, or insinuation of it, sells? Well that real estate company certainly things so.

Stop Shady Marketing of Private Medicare to Seniors

2008-05-09T08:24:00.000-07:00

There has been a wave of consumer complaints, specifically from seniors stating that they had been talked into private Medicare plans without being given full disclosure of its coverage and how it might even force them to change doctors. Aggressive marketing techniques by these private insurance agencies have included cold-calling, cross-selling of products, unsolicited marketing in waiting rooms and senior centers, and pushing customers to repeatedly switch plans to drive up commissions.

This raises the question as to whether the decision by the Bush administration to contract with private insurance companies was a mistake. Do the benefits of sometimes lower rates outweigh the problems stemming from shady marketing practices?

Redefining the word "green"

2008-05-09T07:31:00.000-07:00

Recently there has been lot of talk about sustainability, beyond just the firm's corporate strategy to survive over a period of time. Philips Electronics, a global leader in healthcare products, lighting, and consumer electronics, is at the forefront in its efforts to promote green. To learn more on sustainability and taking green to another level please click on http://www.philips.com/about/sustainability/index.page.

The intent of this blog is not to advertise Philips or its products, but merely share knowledge on how a firm positions green from a fellow Marketing student.

US advertises on Google to snare surfers

2008-05-08T10:03:00.000-07:00

This is an interesting article, so far we have been learning about various marketing strategies for “for profit” companies. This article speaks to one of the marketing strategies for the government, in this case the government of the United States. Where the article is discussing how the US state department, with a help of Google’s AdWords service , draws various internet users searching for words like “terrorism”, “Middle East peace”, “food aid”, etc. and redirects them the America.gov website in order to introduce/educate them with the country’s foreign policy, culture and society. Is there a place for marketing in “every home”!?!

Advertising the Crap Out of a Product

2008-05-08T08:57:00.001-07:00

I think that advertising a product extensively may be a way to achieve TOMA, but not necessarily resounding success. If you look at the delivery pizza exercise from last night in class Domino's certainly had TOMA among the class, but that didn't extend to actually considering a purchase. I suspect that if there were no other options available and we *really* wanted pizza (or were more price sensitive) most of us would settle for Dominos.

Because of segments they target not all products will be of high perceived quality, and I think that we are confusing high perceived quality with product success. There are successful mediocre quality products when they are successfully targeted, priced appropriately, and promoted and distributed through the right channels.

In terms of advertising, at least those who advertise extensively care enough to talk to consumers about their product offering. Psychologically, this gives them an advantage over companies who think their products are so good they don't need to advertise them. Maybe it's the tone and style of blanket advertisements that make them more unsophisticated and offensive, instead of the fact people like Shane Co, Sleep Country, etc are advertising at all.

Might have example for "market the crap out of it" debate

2008-05-08T01:12:00.000-07:00

After reading Sandeep and Doug's debate below I happen to do my typical rounds of looking at the latest news on products and low and behold here might be something worthy of the challenge.
How would you spend 100 million? 3 million for a 2009 super bowl ad... CHEAP!

Advertising The Crap Out Of a Product.

2008-05-07T19:24:00.001-07:00

I recently had a student say that all that really mattered was advertising the crap out of a product. We have since started a conversation that might be of great interest to the readers of this blog.

What is posted here is my e-mail to him with his rebuttal to it.

--- MY E-Mail To The Student---

I wanted to address your comment about advertising. I realize I mentioned the first two in class.

While it is true that advertising generally works, merely advertising a lot WILL not work. Why?

1) Expense- Advertising is very expensive. Superbowl 30-second spot costs $2.6 million. Not sustainable.

2) Targeting- Blanketing the market leads to poor targeting.

3) Not Coordinating Product, Price or Place- High advertising levels hasten the demise of a sub-optimal product if distribution, pricing or product is not in place.

4) Attention- but not trust & value- High levels of advertising build attention, but not trust and value. It does not necessarily build a brand.

5) Price may be more effective- If market is price-elastic, you may be better off reducing price.

6) Competitive War- Advertising a lot will buy you a competitive war a lot of times. Your competition will not sit idly by when you ramp up advertising. The result may be a market share battle with eroding profits.

Let me know what you think.

-----STUDENT's REBUTTAL-----

I'll be glad to rise to the occasion. I am not sure I agree that "merely advertising" a lot will not work, (depending on your definition of "merely,") and I think you missed a few things above. For example, you say that advertising is very expensive. Agreed. Then you say that $2.6 million Superbowl ads are not sustainable. What about Budweiser, Dodge and McDonalds? If I am not mistaken, I believe they buy Superbowl ads every year. I bet they buy again next year. Are you sure expensive ads are not sustainable?

Although blanketing the market leads to poor targeting, a lot of companies do just that, and seem to not only survive, but thrive. Some examples are: Shane Co., Sleep Country, Beacon Plumbing, McDonalds, Vern Fonk, Coke, Pepsi, etc. More about these later.

It is true that there can be sub-optimal production and distribution, but in the above examples these were all managed.

As far as a sub-optiimal product goes, I would claim that all of the above are examples of either sub-optimal products, or products that are priced well above otherwise prevailing levels.

I agree that logically massive advertising should not build trust, but somehow it seem to. Some very intelligent people seem to continually buy from these companies, even though they should know that the value is not there compared to other alternatives. Nothing about the Vern Fonk ads seem designed to build trust, yet they seem quite successful as a business.

I disagree that competitive wars (Coke and Pepsi, for example), necessarily result in loss of market share or eroding profits. In case of the cola wars, independent studies have consistently shown that brands other than Coke and Pepsi have higher ratings in taste tests. Yet Coke and Pepsi have the highest prices and are clear winners in the profit wars. I believe marketing is the difference, since if the difference is not taste, and it is not price, it must be marketing.

Advertising or marketing is by its very nature an attempt to convince people to do something they might not otherwise do. It is my general contention that beyond a certain level of marketing needed to let customers know about the benefits of a product, marketing tends toward brainwashing. Brainwashing, after all, involves repeated messages without contradiction.

Taking this further than products, some very nasty things have been successfully "marketed"--Nazism, for example. An entire country was somehow convinced through propaganda (a form of marketing) that Jews and Gypsies were of lower quality than other people. Slavery, torture, suicide, and killing are just a few more examples of horrible actions that have been successfully "marketed" to acceptance, at least to the "target" audience.

I will restate my assertion: "Anything can be successfully marketed." Sad, but true.

Perceived vs Objective, continued

2008-05-07T09:23:00.000-07:00

The NYT food section had a sobering article that speaks to some of Sandeep's questions from his earlier post. Perceived vs actual quality in wines, apparently, is all in your head. The article cites a study showing that the more expensive consumers think a bottle is, the more pleasure they get out of it. Sifting through the lees from a marketing standpoint, it would indicate that wine is about increasing the perceived value, raising the price--quality is secondary as long as the consumer buys into the fluffery. But when you get right down to it, or distill it if you will, isn't that the job of the marketer?

Perceived vs. Objective Quality

2008-05-07T06:57:00.000-07:00

Given my undergraduate degree in Chemical Engineering, I understand the engineer's passion for maximizing objective quality. After all, an engineer is driven by a passionate need to create a high-quality product which may be defined as "zero defects/bugs" or "built to specifications."

At the same time, in marketing, the quest is for perceived quality. Marketers strive to maximize perceived quality. How does one reconcile these two perspectives?

As Doug mentioned, blind taste tests are a great way of separating these two effects out. For instance, see this study on search engines.

Does the pursuit of perceived quality imply capitulation on the objective quality front? Does the maximization of perceived quality equate with the sale of products with low objective quality and hence, harm to society?

One way that I am able to reconcile these two in my mind is to adopt a threshold model. If the objective quality is above a minimum threshold, then the pursuit of perceived quality is not problematic. At a minimum, the product should not cause physical, financial or psychological harm. It must be reliable. It must work. Beyond that, it is fine to use marketing to gain a perceived quality advantage.

There are some that will argue that a perceived quality advantage is bound to be transitory since the market will figure out that the objective quality is poor. What is very relevant here is the classification of products as search (quality is ascertainable through an objective search process), experience (quality can only be ascertained through an experiential process such as taste, smell or touch) and credence (quality can never be reliably ascertained by an average consumer). Perceived quality advantages are likely to be highest for credence products and lowest for search products. In the case of credence products, perceived quality effects may never be detected and may persist over a long period of time.

Next, there is the ethical issue. Is it unethical to pursue high perceived quality when the objective quality is poor? In some cases, yes. If the product does not work as described, causes harm or is excessively unreliable, I think you have a problem. If you are claiming that your product/service is something that it is not, you have a problem. Beyond that, I believe it is fine to get a perceived quality bump from your marketing activities.

Early on, I made a case for three marketing goals- attention, trust and value. I think perceived quality affects both trust and value.

Ford in Brazil. How will that affect brand image in the US?

2008-05-06T21:48:00.000-07:00

If you click on this link, you will see a video shot last year of a new Ford plant in Brazil.

One look at this and you will instantly be able to tell what is wrong with the domestic manufacturing plants of US auto makers. It pointedly shows why there are problems building auto plant in the US and why more will go off shore. U.S, unions have fought this kind of automation for years for fear of losing jobs and now ironically they are losing jobs because they haven't automated.

Ford and GM are in an impossible spot with their employees in the U.S. The theory is that high wages by world standards and rising health care are squeezing all the profits from these companies. But then there is Toyota building more plants in the U.S. and showing a nice profit to boot. Maybe Toyota will begin to advertise, "Made in America" while Ford and GM go south of the border just like their profits. Toyota should play up the fact that they are increasing jobs in America as a part of their marketing strategy.