So, what’s a brand worth?

Millward Brown — a brands’ consultancy — has just released its Brand Z 2012 brand rankings and valuations (see chart below and click through for the complete list).

Apple tops their list … followed by IBM, Google, McDonald’s, Microsoft and Coke.

Sounds reasonable … but, according to Ad Age — the list re-opens a can of worms re: brand valuations.

Ad Age cites IBM as a case in point:

According to Brand Z, IBM continues its rise up the brand-valuation hierarchy, leapfrogging Google and rising to No. 2 behind Apple, its value up 15% to nearly $116 billion last year.

Omnicom’s Interbrand also had IBM No. 2 in its brand-valuation ranking released last October, up 8%, but valued Big Blue at just under $70 billion, only about 60 cents on Brand Z’s dollar.

But, the CoreBrand Brand Power ranking released about three weeks earlier, said  the value of IBM’s brand plummeted last year as it fell 18 places to No. 66 on that firm’s list.

Hmmm.

Ad Age says it’s illustrative of a bigger problem:

The IBM case is but an extreme among many disparities the Marketing Accountability Standards Board has found in publicly available valuations of brands.

The MASB  has been trying to develop a common way of measuring what brands are worth and how those values change.

“Many of the valuators treat them as black boxes, so you don’t even know what’s in it.”

So, how much is a brand worth?

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Dear Skechers’: “I wore your shoes and my butt’s still humongous. You lied.”

Skechers advertised its Shape-ups as a fitness tool designed to promote weight loss and tone muscles with the shoe’s curved “rocker” or rolling bottom — saying it provides natural instability and causes the consumer to “use more energy with every step.”

But, the Feds want you to know that simply sporting a pair of Skechers’ fitness shoes is not going to get you sexy curves or a toned tush.

For millions of consumers,”the only thing that got a workout was their wallet.”

Skechers will pay $40 million to settle charges by the Federal Trade Commission that the footwear company made unfounded claims that its Shape-ups shoes would help people lose weight and strengthen their butt, leg and stomach muscles.

Consumers who bought the shoes will be eligible for refunds, though it’s not clear how much money people will get.

“The FTC’s message, for Skechers and other national advertisers, is to shape up your substantiation or tone down your claims.”

Skechers says it disputes the charges and is pursuing additional studies.

Souce: Yahoo Finance

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Wake up and smell the coffee … even without the coffee!

Takeaway: Dunkin Donuts launches out-of-store sensory experience linking radio ads with a light coffee aroma spray inside commuter busses.

* * * * *

Excerpted from PSFK.com “Dunkin’ Donuts Interactive Bus Ad Sprays The Aroma Of Coffee”

A South Korean Dunkin’ Donuts campaign is reinventing the traditional radio advertisement using unique technology and the smell of coffee.

The campaign, named, Flavor Radio releases coffee aroma via sound recognition technology.

Each time the Dunkin’ Donuts radio ad was played a light coffee aroma was released using atomizers installed on commuter buses in Seoul.

The aroma has reinforced the sensory connection and experience of the Dunkin’ Donuts brand, and has boosted in-store traffic in South Korea.

In fact, over than 350,000 people experienced the ad during the campaign, leading to number of visitors to the Dunkin’ Donuts stores increasing by 16 percent and sales going up 29 percent.

In-store sensory experience is nothing new to retailers, but now this experience has been taken out of the store and into the streets.

Edit by KJM

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IDEO: Increase your innovation leverage …

Punch line: Less scale, extend reach, and more collaboration. IDEO representative explains how companies and individuals can increase their own innovation leverage.

* * * * *
Excerpted from psfk.com, “How Can Companies Be More Innovative?”

… Recently, psfk.com interviewed Ryan Jacoby  –  who helps clients incubate new businesses, design new offerings, and craft innovation strategies at IDEO.. We asked him to explain how a company or an individual can increase their ‘innovation leverage:’

    Instead of ‘scaling innovation,’ focus on increasing your innovation leverage.

    Scaling innovation often means enabling hundreds or even thousands of individuals within an organization to become more productive participants in the innovation process. While a lofty goal, most organizations aren’t going to transform an organization without years of work and significant investment.

    There are thriving communities and partners out there actively innovating right now. The trick is to tap into that activity. Rather than focusing efforts exclusively on scaling innovation, for some companies I recommend organizations find quick and concrete ways to increase their Innovation Leverage.

    Broadly speaking, you can increase your organization’s Innovation Leverage in two ways:

•     Extending your organization’s innovation reach: Opening up to a variety of collaborators—internal groups, customers, suppliers, stakeholders, and partners—extending your ecosystem in the process.
•     Leveraging your reach and newly formed relationships: Smartly utilizing that extended ecosystem, contributing to platforms, inviting collaboration, and doing more in the process with limited investment.

    As the tools and networks evolve, it should get easier and easier to increase innovation leverage. The trick, as always is the case, is for innovators to get their organizations comfortable with the act of opening up and getting feedback on less-than-perfect ideas. The organizations that do will find a wealth of options for them to innovate more, with less.

Edit by KJM
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Is way cool … too cool?

Last week, I had an interesting coincidence of events.

First …

I was chatting with an MSB alum who is very active in political circles about the marketing of candidates …. specifically, the impact of advertising.

To paraphrase, he said that relatively few political commercials really break through the clutter and move the needle.

He cited two as commonly regarded success models: Hillary’s “3 a.m. phone call” and McCain’s “Celebrity”.

click to view “3 a.m.”

 

click to view “Celebrity”

* * * * *

Then …

President Obama slow jammed on the Jimmy Fallon Show.

Next day, American Crossroads (a GOP Super PAC) ran a “Celebrity” ad knock-off called “Too Cool”

click to view “Too Cool”

* * * * *

Raises an interesting question:

1) Cool move by the President to engage young folks who vote based on “cool”,?

2) Or, did Team Obama hand Team Romney a gift.

Hmmm.

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Carly goes leather: “No more Mr. Nice Guy”

TakeAway: T-Mobile reboots the its brand with an alter-ego of its well-known spokeswoman in the hopes of increasing trial.

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Excerpt from AdAge: “T-Mobile Talks Tough for Its Comeback, Vowing ‘No More Mr. Nice Girl’”

Carly who has starred in T-Mobile’s ads since 2010 and been dubbed by some a DVR-proof pitch personality, is trading her usual frocks for biker leather as the T-Mobile looks to halt mass subscriber defections.

“The pending AT&T deal negatively impacted customer satisfaction and brand perception in 2011, which is why we believe it is time to reinvigorate the challenger strategy and to relaunch the brand,”

Despite its smaller budget, T-Mobile ads have seemed to cut through the clutter, thanks largely to Carly, the only current spokescharacter for a mobile carrier who’s easily recognizable.

Ads featuring biker Carly are intended to equate the brand with speed which is the single-biggest thing consumers are looking for in their next smartphone.

Speed?  Yeah, right/

Edited by ARK
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Do monkeys eat Pringles?

Excerpted from the NY Times When a Sugar High Isn’t Enough

Dr. John Kellogg — founder of the world’s largest cereal company had a simple  credo:  “Eat what the monkey eats …  simple food and not too much of it.”

Do monkeys eat Pringles?

Hope so because Kellogg is buying Pringles from Procter & Gamble in a $2.7 billion deal expected to close this summer.

Why?

For openers, Kellogg’s legacy brands (Corn Flakes and Rice Krispies) are under pressure from private labels and other breakfast convenience foods.

Note: Kellogg cranks out about 200 million pounds of private-label cereal a year.  

The real growth for Kellogg, as well as for packaged-food rivals like PepsiCo and its Frito-Lay division, is foreign markets and snacks.  That’s where Pringles comes in.

Kellogg’s CEO says that selling cereal and selling snacks are two entirely different skills.

What the company is buying with Pringles is not just a line of products that is already huge internationally, but a group of Procter & Gamble merchandisers with “the snack mind-set.” 

“When you’re talking about snacks … it’s about someone who came into the store to buy something else and hit a display and thinks, ‘Hey, I’d love to have a can of Pringles.’

With snacks, it’s much more intercepting the consumer in-store as opposed to getting on their shopping list.

It’s in-store merchandising.

It’s retail entertainment.

Whereas cereal is much more about the 30-second feel-good ad.” 

* * * * *
Nutrition note: According to  Robert H. Lustig, a professor of clinical pediatrics at the University of California, San Francisco:

”People who consume sugar are more likely to overeat because “there are signals to the brain that tell you when you’ve had enough; sugar blocks them.

Eating calories from sugar will therefore lead you to consume more calories.”

 Thanks to DM for feeding the lead

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Novel idea: Hulu promises advertisers that they’ll get what they pay for …

TakeAway: Hulu is challenging online advertising pricing by only charging for fully viewed ads.

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Excerpt from AdAge: “Hulu’s New Guarantee: Someone Watched Your (Whole) Ad”

Advertisers are generally charged when a beacon is fired as an ad begins playing. But Hulu is moving that notification to the end, meaning that and ad that isn’t completed won’t count.

“If you pay for a full impression, you will get an impression, full stop.”

The company said its completion rate for ads is 96% — extraordinarily high for online video, where the average completion rate is closer to 88% for long-form content and 54% for short clips.

“Vendors with greater video completion rates [see] greater brand lift and greater message recall.”

Though the move will cost Hulu some volume, the company’s idea is that it will be made up in higher rates resulting from competition for fewer available spots.

It also means advertisers get some partial impressions free, as a number of viewers will be exposed to a portion of the ad before they click away.

Edited by ARK

Start up says “Our Razors are (expletive deleted) Great!”

TakeAway: A new start-up is using disruptive innovation to cut its way into the multi-billion dollar shaving industry.

* * * * *

Excerpt from WSJ: “A David and Gillette Story”

Dollar Shave Club, the e-commerce start-up, already developed a following for its quirky approach to hawking razors and blades for a $3 to $9 monthly fee.

It began with a YouTube video, in which founder rides on a forklift, plays tennis, and dances with a fuzzy bear. It’s already received some four million views.

The shaving industry market leaders have huge marketing budgets, deep consumer research and relationships with retailers that leave little room for newcomers.

What the start-ups have in their favor is technology. Companies with no marketing budget can command attention with free video and quickly build a following on services like Facebook and Twitter. Netflix have conditioned consumers to getting regular deliveries of the things they use by mail.

It is unclear whether those prices will prove low enough to lure users. By comparison, 15 Gillette Mach3 cartridges can be purchased for as low as $2.06 each on Amazon.com.

Edited by ARK

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For Sale: Best-seller books … Price: $8 per kilo, hardcovers extra.

In one of my classes we study how books are priced.

Last fall, a team suggested that page count was a relevant criteria … that books with more pages should be priced higher than shorter books.

I summarily rejected the idea and joked at the team’s expense.

Well, the page has turned.

The team just returned from China and sent me me this picture.

 Lo and behold, in China, they encountered book stores that sold books based on their weight.

A counterfeit version of the Steve Jobs biography (above) weighed in at 360 grams, and was priced by weight at 18 RMB ($2.85). Roughly 50 RMB ($8) per kilo.

The team tells me that all paperback books in that particular shop (located on Nanjing road, main street Shanghai) are sold at this rate; hardcovers are also priced  by the kilo but at a higher rate.

OK guys, you get the last laugh.

Thanks to Ash Kaluarachchi & Greg Berguig for feeding the lead

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I spy a billboard … hint: look down.

Punch line:  Billboards are no longer larger than life.  Legoland goes against the grain and advertises its ‘Minibreaks’ using the nation’s smallest billboards – incorporating the iconic Lego blocks in its designs.

Excerpted from psfk.com “Tiny Billboards Made Of Blocks Advertise Legoland Vacation”

* * * * *

Advertising agency DLKW Lowe created this great poster campaign for Legoland Windsor, installing tiny Lego billboards around London and inviting passers-by to tweet #legolandminibreaks with a photo if they spotted one of them.

The agency shared a Google Map of their locations to help people find the miniature advertisements.

The nation’s smallest ever billboards promote different aspects of Legoland Minibreaks, including its resort packages, its new hotel, and the fact that kids go free.

Edit by KJM

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A pouch of soup … hmmm, hmmm good!

Punch line: Campbell Soup Co. tests another packaging innovation – this time in a pouch geared at younger consumers – to support its turnaround.

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Excerpted from adage.com, “Campbell Counts on Soups in a Pouch to Spur Turnaround”

Campbell Soup Co. — which has put soup in see-through tubs and sipping cups — is now shoving it in a pouch as the marketer embraces innovations and new packaging in search of a turnaround.

The new microwavable pouches will be sold under the name, Campbell’s Go! Soup, and will launch in up to six flavors ranging from Coconut Curry with Chicken and Shitake Mushrooms to Moroccan Style Chicken with Chickpeas. The flavors, which are a mouthful even to say, are aimed at younger consumers.

… Campbell reported domestic soup sales down 2% last quarter. The new strategy,first announced in July, seeks to reverse Campbell’s overemphasis on sodium reduction and its failure to reach out to young shoppers, who increasingly skip the soup aisle for other simple meals, such as frozen foods.

… CEO Denise Morrison framed the new approach as one that “requires moving from a high dependence on line extensions to more disruptive innovation, new and differentiated products, packaging and category segments that create new pathways for growth.” At the same time, Campbell is sticking by its plan to pour an additional $100 million this year into brand-building, research and development, and product launches.

Pouches and boxes aside, the can will remain at the company’s core. “When we talk about our U.S. soup strategy, we talk about first celebrate the can, then expand soup beyond the can, and then expand them to the greater simple-meals arena,” Ms. Morrison said.

Edit by KJM

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Once mighty AOL now selling off its patents … ouch!

Punch line: AOL has hired Evercore Partners to help it shop around its patent portfolio in hopes of offsetting lost dial-up business and  “accelerating shareholder value creation.”

Meanwhile, Facebook has acquired around 750 patents from IBM in order to “bolster the social network’s defenses against litigious rivals”.

Excerpted from: CNET: AOL, lacking better options, hires firm to sell its patents

Citing three people with knowledge of the hire, Bloomberg says AOL tapped Evercore to find a buyer for more than 800 patents and to “explore other strategic options” — code for a possible sale or private buyout of the entire company.

Last December, AOL announced plans to reorganize the company, combining its declining dial-up Internet service business and its Web services arm, the latter of which was recently scaled back with layoffs in the Instant Messenger group.

AOL has previously said it’s looking for ways to raise cash from its patent portfolio and is making efforts to “accelerate shareholder value creation.”

AOL’s move follows Facebook’s acquisition of some 750 patents from IBM, a deal made to bolster the social network’s defenses against litigious rivals.  Facebook has been targeted by Yahoo for allegedly infringing on a number of its patents that cover customization and advertising.

Easy to pile on AOL for its strategic mis-steps over the years (e.g. hanging with the “walled garden” too long, failing to find a way to migrate to high-speed internet service), but gotta give the company credit for its role in the Internet explosion.

And, in a timely fashion, the original owners dumped the bag on Time-Warner … walking away with a fortune …

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Wasn’t it cheaper to park here yesterday?

Punch line: Airlines have priced dynamically for years — raising or lowering prices depending on how fast a flight’s seats are selling.

Some sports teams have started charging different prices depending on the  day-of-week and and drawing power of the opposing team.

Coke was busted in some locales for electronically jacking up prices when dispensing machines were running low on inventory.

Now, some cities are using high tech meters to dynamically change parking prices.

* * * * *
Excerpted from NYT: A Meter So Expensive, It Creates Parking Spots

As much as a third of the traffic in some areas has been attributed to drivers circling as they hunt for spaces … causing  lost time, polluted air and illegal parking.

In his 2005 book, “The High Cost of Free Parking”, Donald Shoup, a professor of urban planning at UCLA advocated dynamic pricing of metered parking spots — finding the lowest price a city can charge and still have one or two vacant spaces available on every block.

San Francisco is putting the theory to test.

San Fran is using new technology and the law of supply and demand, raising the price of parking on the city’s most crowded blocks and lowering it on its emptiest blocks.

San Francisco installed high tech parking sensors and new meters at roughly a quarter of its 26,800 metered spots to track when and where cars are parked.

And beginning last summer, the city began tweaking its prices up and down and shortening (or lengthening) time limits — trying to to leave each block with at least one available spot all the time.

Eventually, the metes may charge different prices at different times of the day.

“We only need a few people to see there is a price difference and choose to park in a different location to open up just a few spaces here and there.”

But raising prices is rarely popular … and the program was “complicated on the social equity level” since high parking prices can shut out poorer parkers. 

Thanks to JF for feeding the lead.

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Your Diet Coke bottle is … well, quite chic!

TakeAway: Diet Coke partners with Diane von Fürstenberg to design new packaging for its Diet Coke bottle. Proceeds from the sales will go towards the Foundation for the National Institutes of Health. Diet Coke + Fashion + Health? Hmm…

* * * * *
Excerpted from psfk.com “Diane von Fürstenberg Redesigns Diet Coke”

Proceeds from the sales of Diane von Fürstenberg’s Diet Coke collection will go towards the Foundation for the National Institutes of Health.

Although there’s nothing new about celebrity bottles these days, we think the fashion designer has a fresh approach on an aging marketing gimmick – plus the charity angle is interesting (if a little ironic considering the discussion about the healthiness of diet soda).

Edit by KJM

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McBaguette, s’il vous plait …

Punch line: Is Mickey D. is going haute cuisine? No, not really.  The Mickster is just sticking a burger on baguette and charging the French a premium price.  Mon dieu.

* * * * *
Excerpted from the WSJ “To Tailor Burgers for France, McDonald’s Enlists Baguett”

In France the fast-food giant is gearing up to offer a burger served on baguette, part of a wider effort to add more locally inspired fare to its menu and attract more upscale diners.

McDonald’s restaurants across France will test the McBaguette — a burger topped with French-made Emmental cheese and mustard.

The promotion is in line with the  company’s successful global strategy of updating its restaurants to appeal to a broader clientele, while offering a more varied menu, up and down the price scale.

In France that involves tapping into a national obsession: bread.

• 98% of French people eat bread every day.
• The French each consume about 55 kilograms (a21 pounds)of bread a year.
• 65% of the two billion sandwiches sold each year in France are baguette-based.

The McBaguette will be sold for €4.50, more than a euro above the average price of a sandwich in France.

* * * * *
Ken’s Take: “Obsession with bread”?  I thought the French were obsessed with something else.  Live and learn …

Thanks to AGC

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Target the targeter becomes the target … very predictable.

This is going to be hard for Target to shake.

The NYT revelations that Target has been mining its data bases to early-identify pregnant women and “change their buying behaviors when they’re vulnerable to marketing initiatives” has gone viral.

Now, Target has become a target …

Here’s a funny piece from the Colbert Report:

click to view

Thanks to RG for feeding the lead

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Remember when a Blackberry was cool?

Punch line: Remember when you’d secretly watching out-of-the-corner of your eye for that blinking red light? Yep, we all did it – and it even fed our egos of feeling somewhat important when we knew we had a message pending… Well, RIM,  the makers of the “crackberry,” first dominated the marketplace but seem to have lost sight of its strengths, and customer needs. Now, it struggles for survival in the marketplace …

* * * * *

Excerpted from mashable.com “7 Marketing Lessons From RIM’s Failures”

Long before the iPhone the took the world by storm, and before Google even dreamed about getting into the phone business, Research in Motion was on top of the consumer electronics mountain.

Today, sadly, it is buried under it, and industry insiders everywhere wonder whether RIM will survive …

Here are seven marketing lessons from RIM’s dark and difficult journey.

1. Make Great Products

Consumer electronics success begins with excellent products. The BlackBerry was once perceived as the very best smartphone — or, at least, “emailing phone” — available. It was exciting, emotional and it made people feel good. RIM sold BlackBerries on the strength of word-of-mouth recommendations. BlackBerries were aspirational, and people wanted to own one because friends and colleagues were so passionate about them.

Now, fast-forward to today.

Consider the excitement and energy around the iPhone and all those Android handsets. RIM enjoys none of that today. Not one percent of it. In part, it’s because it stopped making good smartphones in favor of a poorly received tablet called the PlayBook.

Successful marketing begins with having a tremendous product or service to market. Nothing happens without this.

2. Build on Strengths Instead of Improving on Weaknesses

For RIM, the BlackBerry was a great strength, and they all but abandoned its development and marketing for a year or longer to create the tablet. RIM did this to try to prevent the world from passing it by in the tablet space — which it did anyway. Tragically, as a result of diverting talent, attention, resources, investment and innovation from the BlackBerry to the Playbook, the consumer smartphone world has also passed RIM by.

If you focus on developing weaknesses, your strengths will atrophy due to neglect.

3. Gravity Pushes Backwards

If you’ve attained a measure of success, you must continue innovating your products, services and your marketing just to maintain your position. Because you can bet the competition is innovating aggressively, and they’ll pass you by in three seconds if you stop doing the things that brought you success. RIM not only stopped releasing new BlackBerries while focusing on its PlayBook, it basically stopped talking to its customers about them for an extended period.

Gravity pushes backwards in business. Consistent and aggressive innovation is required not only to attain success, but to maintain it.

4. Know Precisely Who Your Customer Is

RIM’s management famously disagreed on who their customer was. Then co-CEO Mike Lazaridis felt the customer was the corporation. Others, probably including his counterpart Jim Balsillie, wanted to aim BlackBerry products at consumers. If you don’t know exactly who your customer is, it is impossible to market. Language, messaging, platforms, branding and public relations change completely depending on the customers you target.

So identify your customers as precisely as possible, and aim all of your marketing efforts at them.

5. Executives Set the Marketing Tone

Consider the most successful companies in consumer electronics (and two of the most successful companies in all of business): Apple and Amazon. Their chief executives set their marketing tone, and everyone follows. If you haven’t seen it yet, watch this YouTube video of Steve Jobs introducing the iPad, and listen to how everybody who followed him on stage used exactly the same words.

This is no accident. The next day, thousands of articles used the same words to describe the amazing, remarkable and awesome iPad. Amazon’s Bezos is the same way. The best marketers have high-level executives setting the tone. They not only teach the rest of the company how to talk about their products and services, but the customers, the media, and the market itself. Obviously, RIM’s co-CEOs did not set this tone. They couldn’t even agree on who the customer was.

6. Avoid Unforced Errors

Most marketing problems are self-made and entirely avoidable. Consider the major developments from RIM’s recent past:

• It voluntarily stopped focusing on the BlackBerry to make a product it had no experience with.
• It could not identify its customer.
• It stopped marketing to consumers, allowing competition to roar past.

7. Keep Talking to Your Customers

If RIM had talked to its customers like this, it would have quickly learned that they probably weren’t particularly interested in a BlackBerry tablet without built-in email, messaging or contacts!

If you’re not talking to your customers, you’re just guessing from a conference room.

Edit by KJM

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Forget Membership Points…..Your Reward is a Surprise!!

Punch line: Best Buy is differentiating its membership rewards with a “surprise and delight” approach.

Sure beats cold cash discounts, right?

* * * * *
Excerpted form AdAge: “Surprise! Here’s a Ticket to a Movie Premiere, on Best Buy”

Best Buy invited a handful of top shoppers and their family members to an exclusive preview of “Twilight Eclipse.”

The reward, which went to select members of Best Buy’s Reward Zone loyalty program, was part of a “surprise and delight” approach that’s becoming a mainstay in loyalty strategies.

“Surprise and delight” plays off the principle that a dollar bill is always worth more when you find it crinkled up in an old pair of pants.

At Best Buy, surprises have taken the form of movie premieres and exclusive shopping invites on Black Friday.

Edited by ARK

Target bellies up to moms-to-be … by mining their shopping patterns.

In a previous post, we excepted from a NY Times article How Companies Learn Your Secrets that

1. Much of what people do is based on habits, not conscious reasoning.
2. Consumers’ shopping habits and brand loyalties are often more habitual than thoughtful.
3. But, there are certain “events” — e.g. new baby, new home, recent divorce — that seem to make consumers more open to switching stores and brands.
4. Savvy marketers are learning to identify these critical events — before they happen — and try to get consumers to switch  their behavior.

Target is one of the retailers identifying customers who are “vulnerable to intervention by marketers” … and pouncing on them.

Who?  Moms-to-be.

How?

According to the NY Times article, Target identified about 25 products that, when analyzed together, allowed them to assign each shopper a “pregnancy prediction” score.

For example, sometime in the first 20 weeks, pregnant women tend to load up on body lotions and supplements like calcium, magnesium and zinc.

With that information in their computer systems, Target can identify likely pregnant women and, more important,  estimate their due dates, so that  Target can send coupons timed to very specific stages of her pregnancy.

It’s a bit unbelievable … and a lot creepy.

And, oh yeah, it works.

But, gotta wonder why Target let this cat out of the bag …  if this story goes viral,  the privacy concerns are likely to offset the added sales to moms-to-be.

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Move over MJ … Nike’s ready with some Lin-kicks.

Punch line: Nike has jumped on the Lin band wagon and plans to release the Hyperfuse 2011 Linsanity PE.

Pretty catchy name, right?. 

* * * * *

Excerpted from brandchannel.com, “With Jeremy Lin Shoe, Nike Seeks Linsane Asylum”

In case you hadn’t noticed, the world has gone nuts for New York Knicks point guard Jeremy Lin …

Now Nike is planning to give the people what they want: to be #Linning too.

According to ESPN Radio’s blog, the shoe manufacturer is “set to release the Nike Hyperfuse 2011 Linsanity PE,” a shoe that features New York Knick’s iconic orange and blue with ‘Lin’ written in script, “sweeping across the side of the heel” …

Lin’s new shoe isn’t likely to supplant the Air Jordan in Nike history, of course, but it’s hard to imagine what will happen if Lin keeps leading the Knicks to consecutive victories — and after the inevitable end to the hot streak …

Meanwhile, Lin’s brand keeps getting larger, and not just in the U.S.

Lin — who is the first American-born player in the NBA of Chinese or Taiwanese descent — now has more than 350,000 Twitter followers and, on the Chinese version, 750,000, according to the New Yorker. The publication notes that “last week, Lin rocketed to the number-one most searched item on Baidu, the Chinese search engine.”…

Edit by KJM

Hitting consumers when they’re “vulnerable to intervention by marketers”…

Punch line: Many of consumers’  buying behaviors are habitual — deeply ingrained and difficult of to change.  Marketers have to identify times when consumers are open to change and get them. to break  their habits. 

The good news: the are times when consumers are, in fact, ripe for change …

In the 1980s, a team of researchers led by a U.C.L.A. professor named Alan Andreasen (now at MSB) undertook a study of peoples’ most mundane purchases, like soap, toothpaste, trash bags and toilet paper.

They learned that most shoppers paid almost no attention to how they bought these products, that the purchases occurred habitually, without any complex decision-making.

Which meant it was hard for marketers, despite their displays and coupons and product promotions, to persuade shoppers to change.

But when some customers were going through a major life event, like graduating from college or getting a new job or moving to a new town, their shopping habits became flexible in ways that were both predictable and potential gold mines for retailers.

The study found that:

• When someone marries, he or she is more likely to start buying a new type of coffee.
• When a couple move into a new house, they’re more apt to purchase a different kind of cereal.
• When they divorce, there’s an increased chance they’ll start buying different brands of beer.

At those unique moments, Andreasen wrote, customers are “vulnerable to intervention by marketers.”

In other words, a precisely timed advertisement, sent to a recent divorcee or new homebuyer, can change someone’s shopping patterns for years.

Excerpted from NY Times, How Companies Learn Your Secrets, by Charles Duhigg

Note that Prof. Andreasen didn’t just pick off the obvious stuff — e.g. new parents buying baby stuff,  new home owners furnishing their new digs, or divorcees buying new duds.

No, the life-changers seem willing to change many of their buying patterns and brand loyalties.

Next: How Target identifies customers who are “vulnerable to intervention by marketers”  … and pounces on them.

>> Latest Posts

Hit the trademark button: Linsanity™

NY Knicks sensation Jeremy Lin is going on offense to protect “Linsanity”.

Last week, he applied for trademark rights to Linsanity.

One of Lin’s attorneys confirmed: “We’re prepared to protect his intellectual property rights,” said Pam Deese at the Washington, D.C., law firm of Arent Fox. She declined to comment further

Lin paid a filing fee of $1,625 to cover use of the trademarked term on all manner of apparel, including underwear.

Here’s the rub: One of Lin’s high school basketball coaches reportedly bought the domain name Linsanity.com in 2010 and has been selling Lin branded merchandise including T-shirts that have similar blue and orange coloring like that of the Knicks’ uniforms..

According to the Huffington Post:

“The NBA is pursuing enforcement — in the US, China and other countries — to address the sale of counterfeit ‘Lin’ jerseys and other unauthorized merchandise using NBA intellectual property. We also are coordinating with Jeremy Lin’s representatives regarding their efforts to enforce against the unauthorized use of his name and image.”

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Walmart marks healthy options with its own “Great for you” icon

Punchline: Walmart moms want to buy healthier foods for their families, but are over-whelmed by nutrition labels and options. To simplify the buying process and promote healthier eating, Walmart has made a “Great for you” icon for its healthy products.

* * * * *
Excerpted from brandchannel.com, “Walmart’s “Great for You” Icon Promotes Healthier Food Choices”

A year after pledging to develop a front-of-pack label that would give its customers an easier way to identify healthier food, and a month after a public commitment with First Lady Michelle Obama to putting nutrition front and center in its stores, Walmart, the nation’s largest food retailer this week unveiled a “Great For You” icon to create a visual system to educate customers ..

Walmart says it will adapt to whatever the FDA’s regulations are whenever that list actually is produced, but will for now add the icon to products with lower levels of fat, sugar, and artificial additives. Plus, the seal will appear on signage in the fruits and vegetable section of its grocery area.

“It helps customers see very, very quickly what healthier choices are for them,” stated Andrea Thomas, SVP of sustainability for Wal-Mart Stores …

“Walmart moms are telling us they want to make healthier choices for their families, but need help deciphering all the claims and information already displayed on products,” said Andrea Thomas, senior vice president of sustainability at Walmart. “Our ‘Great For You’ icon provides customers with an easy way to quickly identify healthier food choices. As they continue to balance busy schedules and tight budgets, this simple tool encourages families to have a healthier diet” …

Edit by KJM.

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What does your bus stop smell like?

TakeAway: Promoting a new product, UK’s McCain Foods is pumping the smell of baked potatoes into local bus stops. That would drive Occupiers crazy in the U.S. … or, maybe, make them smell better.

Hmmm. Worth a try.

* * * * *
Excerpt from AdAge: “Smell-Vertising Hits U.K. With Potato-Scented Bus Shelters”

McCain Foods is tempting UK consumers with the wafting smell of “3-D baked potatoes” as they wait at city bus shelters.

When people press a button on a poster, a hidden heating element warms the fiberglass 3-D potato and releases the aroma of oven-baked jacket potato throughout the bus shelter.

The shelters will also dispense a discount for the product: baked potatoes that are ready to eat from frozen in five minutes.

Edited by ARK

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Obama’s favorite book … guaranteed.

Gotta admit, I like the tussle between Team O and the Catholic Church.  It’s like watching a Wrestlemania main event.

But, theological and and health issues aside, I’m shocked by Administration’s naiveté re: business and economics.

And, I think I broke the code. 

I’m betting that the only business book Obama and his advisers carry around is Chris Anderson’s 2009 best-seller: Free – The Future of a Radical Price.

Note that I said “carry around” … not “read” … because the book does a nice job of explaining the uses and mis-uses of “free”,

Why do I think so?

Easy, because the cover blurb was written by Google’s Eric Schmidt — the recently canned Google CEO and close buddy of Obama’s … and because of Obama’s penchant for declaring stuff to be “free” whether it is or isn’t.

Obviously, Team O doesn’t really get the concept.

Let’s start with the basics: nothing is free. 

When something (like pills) is produced, delivered and consumed, there are associated  costs.

Yes, pills may be given to the consumer without charge, but somebody has to pick-up the tab.

Since the government has no money of its own, if it nobly declares that it’ll pay for it, it’s really saying that all taxpayers will pay for it — whether they want to or not.

Note that, for obvious reasons,  I said taxpayer, and not citizens. 

Let’s take another variation: consumers don’t have to pay for pills — their insurance companies will be mandated to give them away for free.

Oh really.

One member of the administration said that the money will come straight from the insurance companies reserves — the money set aside to pay claims.

Well, then either other types of claims become unfunded (i.e. can’t be paid), or the insurance  company just rolls over and sacrifices some profits, or premiums go up.

There aren’t any other options, and I’m betting on the last one — raising premiums.

That’s ok — in the mind of the Feds — because employers, not employees have to eat the premium increase.

Well, economists would say that the higher premiums come indirectly out of employees pockets since they will just constrain other parts of workers’ compensation packages.

You can buy into that argument or not … your choice.

Let’s pretend that the insurance company just has to eat the added costs.

Oops.

Team O walked into a logic trap.

Many large organizations self-insure.  That means that insurance companies are just processing agents — the companies pay claims out of their own coffers. 

It was like that at GE and Black & Decker.

And guess what, many large Catholic organizations are self-insured.

So, saying that the Catholic organizations won’t have to pay for pills, etc., — that their insurance companies will have to pay — is complete nonsense.

You see, self-insured organizations are their own insurance companies.

That’s what self-insured means!

So, even the Catholic bishops figured out that Team O’s grand accommodation is not really an accommodation at all.

It’s either the reflection of business ignorance or an intentional ruse.

Hmmm.  Hard to pick.

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Does sex sell? Just ask GoDaddy … or, watch this year’s Super Bowl

USA Today reports …

Thirty-some advertisers will spend upwards of $230 million just for the airtime to fight for attention in the Feb. 5 game.

At stake: the eyeballs of more than 100 million Super Bowl viewers. And the urgent need to drive all of them online to find out more, socialize and tweet with friends and ultimately buy that beer, smartphone or luxury car.

Sexy ads are slinking back to the Super Bowl.

No company has used sexual imagery more shamelessly on the Super Bowl than GoDaddy.

“We set the standard of indecency,” jokes CEO Parsons, who takes special pride in being widely accused of single-handedly bringing down the tone of Super Bowl advertising.

Truth be told, the action in each GoDaddy ad is just a big tease to get folks to go online and find out more about the company that people use to register domain names and host websites.

The ploy, which GoDaddy has used for eight consecutive Super Bowls, works ridiculously well.

But. some researchers have found that spots with sexual imagery take a 10% hit in “likability” vs. ads without racy images.

They conclude that most viewers actually prefer to see ads with kids or animals.

Yeah, right.

Watch the vid .. then you decide.

        click to view video

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Toyota targets new hybrid launches at young buyers …

Question: How many total hybrid cars or trucks sold in the US are Toyota Priuses?

Answer: Nearly 50%.

Toyota hopes to grow its share of the hybrid market with new product launches, such as the Prius C –  “c” for city, to attract young buyers.

* * * * *
Excerpted from brandchannel.com, “NAIAS Action: Toyota Woos Younger Buyers with Hybrids”

Toyota and Honda …  have been gearing up new products they’re hoping will begin attracting Americans back to their brands this year …

Toyota  showed off its new Prius c — the “c” in the name is for city — a small entry in its growing “family” of Prius hybrids, and bowed its NS4 concept plug-in hybrid that should see the market around 2015.

… Toyota is  reaffirming its commitment to the long-term future of a type of propulsion that it pioneered with the Prius hybrid.

Toyota also plans to introduce a “plug-in” Prius, a la the Chevrolet Volt, sometime this year, as well as a Scion iQ EV and a second generation of its Toyota RAV4 EV, an SUV, in small volumes.

“Young buyers on a budget have seen hybrids as out of reach… The next three years … will be a critical period for gauging consumer interest in other advanced technologies.

Cost and convenience will remain the key challenges during this period. [Also], refueling infrastructure remains a distinct challenge“  …

Edit by KJM

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An apple a day is so yesterday … now, “go bananas” every day !

Takeaway: Forget the old adage, “An Apple a Day,” Dole wants you to make it a banana a day. As part of its “Go Bananas” campaign, Dole aims to drive more usage occasions with Americans, while making us all a bit healthier…

* * * * *
Excerpted from progressivegrocer.com, “Dole Dares Consumers to ‘Go Bananas’ in 2012”

… Although nearly 90 percent of U.S. households already buy bananas on a regular basis, Dole wants all Americans to make bananas part of their daily routine in 2012. The year-long initiative aligns with Dole’s long-time goal of bettering the public’s nutritional health through greater consumption of fresh fruits and vegetables.

As the world’s largest provider of fresh produce and the top banana brand in North America, Dole is building upon the success of its “Go Bananas” campaigns in 2009 and 2010 to take America’s love for bananas to the next level. The “Go Bananas Every Day” initiative from Dole Fresh Fruit offers recipes, promotions and partnerships with 366 ways (2012 is a leap year, after all) to enjoy the ubiquitous fruit this year …

Among the ways consumers can show their banana love throughout 2012:

• Day 78 (Mar 18): Treat your post – St. Patrick’s Day hangover with a banana, nature’s Vitamin B6-rich hangover cure.
• Day 238 (Aug. 25): Observe National Banana Split Day. The famous dessert celebrates its 108th birthday in 2012.
• Day 285 (Oct. 11): Trade in the nicotine gum or patch for a banana to help stop smoking …

The initiative will be supported by a 12-month-long multimedia marketing effort encompassing a campaign-specific microsite, traditional and digital advertising, a sticker program, public relations, social media, a blogger and other third-party partnerships. Dole will visit select cities throughout the year to meet with food bloggers, registered dietitians, retailers, the media and other influencers to discuss the health, versatility, affordability and convenience benefits of bananas …

Edit by KJM

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Don’t you dare call me the “Egg McMuffin” of anything !

Punch line: In the old days, Cadillac was the badge of excellence.  Calling something the Cadillac of its category was high praise.

Well, Mickey D. wants to fill the void with the Egg McMuffin … suggesting that this breakfast sandwich is somehow synonymous with excellence.

Based on social networking indicators, the idea is getting some traction.

Gotta make you proud to be a marketer …

* * * * *
Excerpted from adweek.com, “Is This Egg McMuffin Ad the Egg McMuffin of Ads? Breakfast sandwich gets new catchphrase”

http://www.youtube.com/watch?feature=player_embedded&v=nn1IGSCp2yI#t=0s

Casting the Egg McMuffin as shorthand for excellence is about as odd as grouping it with healthy foods and casting it as a wholesome dietary choice.

But McDonald’s latest commercial for the breakfast sandwich does just that, starting with a girl telling a guy that he’s “the Egg McMuffin of boyfriends” and proceeding from there.

That phrase has caught on quickly, with the Boston Globe reporting on the adoption of the phrase in social media — used ironically or not — with something like 11,000 tweets and 1,200 Facebook mentions.

Check Twitter for various clever uses. It even made Craigslist, where a New Jersey residence was described as “the Egg McMuffin of 2 BR apts in downtown Hoboken.”

Returning to the ad, my favorite part is the Egg McMuffin of cars bit.

That’s how a friend of mine used to describe his old vehicle because it leaked oil and smelled gross.

click to view the commercial

Edit by KJM

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Looks like a hybrid, runs like a hybrid … it’s eAssist.

Punch line: Buick is ducking some common perceptions by calling its new LaCrosse hybrid a “LaCrosse with eAssist”.

Excerpted from BrandChannel …

American consumers remain decidedly lukewarm to hybrid vehicles.

Buick is hoping to get around this obstacle by positioning its latest hybrid, a version of the LaCrosse sedan, as a non-hybrid. Instead, GM is touting the “light electrification” system it uses for the car and has come up with a unique brand name for it: “eAssist.”

“When you say ‘hybrid,’ many times that comes with baggage.”

“So for us, the focus was to put an emphasis on the car itself and what this car delivers and how technology enhances the ownership experience.

We’re selling a LaCrosse that happens to have this great [eAssist] technology.”

For example, Buick and its dealers are emphasizing: the quiet ride… and the car’s  “start-stop” capability which halts operation of the engine at stoplights, saving fuel, and then starts it up again when the driver punches the accelerator.

The LaCrosse with eAssist retains a feature that has proven popular with most hybrid purchasers: a screen on the instrument panel that helps them track …  fuel economy.”

The eAssist gauge “is a way for people to show they’ve got something unique, and they can show their friends and families.”

That’ll fool a lot of folks, won’t it?

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Ditch your scissors … mobile couponing is is what’s happening.

TakeAway: Sorry coupon printers, people are going mobile with their couponing… Juniper research report reveals global mobile coupon redemption is growing an average 8% yearly … overtaking  the best paper coupon campaigns.

* * * * *
Excerpted from progressivegrocer.com, “Global Mobile Coupon Redemption to be 8 Times Paper by 2016”

The global redemption rate of mobile couponing is   growing over 8 percent annually, according to Juniper Research.

According to the “Mobile Coupons Whitepaper,” by 2016 there will be over 600 million regular mobile coupon users worldwide.

The report found that mobile coupons have compelling advantages over their paper … as mobile coupons:

• Bridge the divide between online and physical retailing
• Can be individually targeted to drive traffic to stores

For the next few years users will be signing up to multiple coupon schemes and deciding on the ones they like best – so now is a crucial time for mobile marketing agencies to get it right on behalf of their clients and establish a loyal customer base. ”

Other findings from the report include:

• The integration of mobile coupons and mobile payment data is rare and an untapped opportunity.
• Redemption values will exceed $43bn globally by 2016, driven by better targeting and mobile apps.

Edit by KJM

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Marketing Strategy Rule #1: Follow the money …

When diagnosing a current marketing strategy or developing a new one, most marketers jump right in to thinking about market segments, products, or ads.

Wrong.

I  encourage my students to always, always, always start with an analytical understanding of the business economics: how companies make money in the business.

It’s “Ken’s Rule #1” of strategy …

Historical note: During Nixon’s Watergate scandal, a source to Washington Post’s Woodward and Bernstein – nicknamed “Deepthroat” – kept telling the investigative journalists to “follow the money”.  That advice coined the now popular expression.

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HOT: Why is marketing important (and cool)?

Responding to MSB alums, before the holidays, I posted the first HOT:  Homa Online Tutorial – material right out of the classroom to you via the HomaFiles.

Since I’ve gotten some positive feedback, here’s another HOT topic … the relevance and importance of marketing.

Fact is, many folks think that marketing is nothing more than a bunch of b.s. being dished by shysters.

And, some folks (think finance majors)  regard marketing as unchallenging & touchy-feely … a discipline for folks who can’t cut it in finance.

Au contraire, mes amies.

In this session, I try to convey that marketing plays a central role in most companies, is highly analytical,  and – done right – is harder than it looks.

   click to view

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Ditched by NPR … for the record, here’s what I said.

A couple of weeks ago I was invited to do a radio interview with NPR for its MarketPlace business segment.

The topic was retailer’s pricing practices.

Right down my power alley, so I was amped.

I took the interview seriously – even did some research.

Went to the studios for the interview … which was recorded.

After the allotted 30 minutes, the reporter asked me if I could continue for another 3o minutes.

Sure.

I expected she’d pull a couple of 15 second sound bites out of the 60 minutes.

To my dismay, all 60 minutes of my “filet”  hit the edit room floor.  Ouch.

Below, I’ll give my hypothesis for what happened … here (based on my notes) is what I said … some pretty good stuff – if I must say so myself.

Studies consistently show that consumers’ have very imprecise knowledge of prices.

Very few consumers are even able to recall — within 5 or 10% the price they paid … even for recently bought or frequently bought items.

The exceptions are so-called “signpost items” — such as a gallon of milk or a 12-pack of Coke. Consumers often use those items as “sample precincts” used to implicitly judge other prices in a store.

“If they’re priced right on milk, they must be priced right on other products”

* * * * *

People look for “cues” when evaluating a product’s price.

The words “free”. “new” and “sale” are probably the most impactful in a marketer’s vocabulary.

“Sale” takes on a particularly strong meaning when it’s supported by a comparative price claim  … versus competitors’ prices  … or versus a self-proclaimed “regular price”.

Since people tend to have imprecise knowledge of prices, they often  anchor their price perceptions on stated regular prices and react — or over-react – to the implied discounts.

Shoppers conclude – sometimes erroneously: The bigger the discount, the better the deal.

* * * * *

Legally speaking, a “regular price” is defined as a price that was offered for a meaningful length of time and at which a substantial amount of sales were made.

Of course, the terms “meaningful length of time” and “substantial sales” are subject to interpretation and often tough to pin down in practice.

It boils down to whether a good faith effort was made to sell the product at its “regular price”.

* * * * *

While the FTC has legal jurisdiction over unfair marketing practices – including “fictitious price claims” –  it hasn’t brought any cases in the past 30 years.

The FTC has largely delegated enforcement to the states and localities … which have a crazy-quilt of statutes that are selectively enforced, typically when there is a veritable groundswell of consumer complaints.

Even then, cases are hard to prove and any penalties are relatively light slaps-on-hands.

* * * * *

Some retailers make heavy use of what’s called “high-low” or “was/is” pricing tactics.

That is, they run frequent sales that emphasize the discount from so-called regular prices.

Kohl’s is famous for using the “was/is” tactic; so is the men’s clothing chain Jos A Banks – which routinely run sales touting “buy 1 suit at regular price and get 2 for free”.

If anybody buys anything at those stores at “regular” prices, they should look over their shoulders to make sure that Darwin isn’t chasing them”

* * * * * *

These high-low tactics are a relatively benign form of marketing hype.

Savvy buyers ignore everything but the bottom line price that they’ll be paying.

They ask themselves do I want to buy this product at this price?

Sure, they might want to shop around to see if they can find a lower price someplace else, but …

What somebody else may or may not have paid for the product at another point in time is largely irrelevant … except for bargain hunter’s bragging rights.

The real question is whether you want to buy that shirt for $19,99 or not.

* * * * *

Further, strict enforcement of the statutes may actually have a harmful effect on consumers.

Think about it … why force a retailer to sell more stuff at a high price to satisfy a statute?

That would result in consumers – on average – to pay more for products

* * * * *

I get more concerned with hidden charges that aren’t reflected in the prices that customers think they’re paying.

For example, shipping & handling charges that far exceed the cost to ship or handle …

Or, stripped down products that don’t include all the necessary components … like computer peripherals that don’t include the connecting cables … or printers that come with toner cartridges that print a minimal number of copies.

Often times, buyers don’t know what hit them until after-the-fact …

Basically, the piece that aired was dumbed down to “lots of stuff is on sale … really, LOTS of stuff”   A surprisingly light piece.

My hypothesis: the reporter went into the story expecting to nail retailers (like Kohl’s) for deceptive practices.  My view was that the “was-is” pricing tactic is pretty benign and that shoppers should just focus on the current price.  That didn’t support the story line.

And, I doubt the reporter could find anybody who got very excited about whether retailers’ “regular” prices really were regular prices.

So the storyline fell apart and “lots of stuff on sale” became the emphasis.

Woulda thought the Darwin line would make the cut. 

Oh well … it made the Homa Files !

>> Latest Posts

“Little” brands, few ad dollars … lots of awareness.

TakeAway: Small brands overcome limited marketing budgets by growing brand awareness through support of social movements, in-store experiences and work culture.

* * * * *
Excerpt from AdAge: “How Little Brands Land Big Bang for Their Buck”

Brands built with little or no media support were once relatively rare, but they’ve begun to proliferate in recent years.

From Ben & Jerry’s, Honest Tea and Lululemon, they fascinate the many marketers who must shell out millions to get noticed.

One reason is that these success stories are often built on factors that don’t usually fit with big, established brands.

For example, some are built on substantial investments in branded retail stores and the store experience, rather than media.

Others are built on the brand’s affinity with political and social movements that can be tough for big brands to embrace.

And some have been based on big investments in wages, benefits and fun cultures that keep employees happy — not the usual storyline for huge corporations.

The common thread through all these no-cost, low-cost marketing success stories is a good story, one that bears repeating and fares well both in social and PR-fueled traditional media.

Almost by definition, such stories are easier for bootstrap entrepreneurs to come by than, say, 65-year-old detergent brands.

All things considered, It’s still nice to have money ..

Edit by ARK

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YouTube says it’s where the action is …

Punch line: YouTube hopes to gain a greater share of online advertising spend. Yet, only 1% of ad spend is on online video vs. 38% for TV ads. YouTube bets that its global and local reach is an targeted advantage for this media outlet. So will large CPG firms (e.g., P&G) pump more dollars into YouTube?

* * * * *
Excerpted from www.business-standard.com, “YouTube makes the case that it helps build brands”

Despite online video and commercial-skipping DVRs, companies still spend 38% of their advertising budgets on television ads and just 1% on online video. YouTube is trying to change that.

In a bid to lure TV ad dollars, YouTube is making the case to brands that online video is the best way to reach customers …

“We would love YouTube to be a much larger part of brands’ advertising budget and mix in the next year and the future than it is today,” said Lucas Watson, YouTube’s vice president of online video global sales.

… It now says it has 800 million unique viewers worldwide a month. Analysts estimate that YouTube contributes more than $1 billion to Google’s annual ad revenue and is most likely profitable.

But YouTube, now six years old, is still in the early stages of making money. Advertisers spend just $2.2 billion on all online video ads, compared with $60.5 billion on television ads …. ad agencies are only now hiring people with expertise in online video …

YouTube has to recruit new kinds of advertisers, beyond the music, entertainment and technology companies that have flocked to the site, and convince them that YouTube is a fruitful place for brand building …

Unlike television, YouTube incorporates social elements by inviting viewers to choose whether they watch, share or create their own videos about advertisers’ products.

YouTube has both global reach and the ability to target an ad to 20-something men who live near a pizza shop …

Even though YouTube is showing more professional videos so brands can avoid appearing next to unsavory homemade videos, advertisers still hesitate to spend as much on YouTube as they do on TV …

Edit by KJM.

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Knock, knock … here’s your Big Mac.

TakeAway: Fast food franchises are replacing drive-thru with delivery in Asia, Middle East, & African markets. Comin’ to America?

* * * * *
Excerpt from WSJ: “Asia Delivers for McDonald’s”

Delivery is becoming an important part of McDonalds and KFC where cities are too crowded and real estate costs too high to build drive-throughs.

KFC offers delivery in more than half its 3,500 restaurants in China, and estimates delivery in more than 2,000 new KFC restaurants in China over the next decade.

McDonalds says delivery sales have been posting double-digit growth every year in every country where it’s offered. In Egypt, where McDonald’s first started offering delivery in 1994, more than 30% of total sales come from delivery.

Still, it’s not a model either company plans to export to Western markets. McDonald’s derives about two-thirds of its sales in the U.S. from drive -through customers.

In some countries, such as China, customers pay a flat fee for delivery. In others, people pay a fee equal to 15% to 20% of their order price.

Edited by ARK

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Forget Millennial .. it’s the Quadrennial Effect that matters.

TakeAway: Is spending cyclical? Some forecasters believe so and are predicting higher ad spending in 2012 because of the key events that happen every 4 years. The impact of these events on the economy is known as the Quadrennial Effect.

* * * * *
Excerpt from NYT: “Quadrennial Effect Could Make ’12 a Very Good Year”

The fact that several events that happen every four years will take place next year will stimulate the media and ad industries, leading forecasters said, offsetting the detrimental effects of the European debt crisis.

Events on the 2012 calendar likely to encourage more ad spending than this year include the United States presidential and Congressional elections, the Summer Olympic Games and the European Football (soccer) Championship.

Some analysts are expecting “The strongest-ever quadrennial effect” … adding  $7 billion to global ad spending in 2012.

For all its power, the quadrennial effect can do only so much in a bad economy.

Edit by ARK

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Go get me a ream of Dunder Mifflin paper … really!

TakeAway: Staples uses a fictional brand name from the popular TV show “The Office” to differentiate and boost sales in a declining commodity-like industry.

* * * * *
Excerpt from WSJ: “Great Scott! Dunder Mifflin Morphs Into Real-Life Brand of Copy Paper”

Staples’ Quill.com has struck a licensing deal with NBC’s parent company to launch a Dunder Mifflin brand.

Priced above private-label copy paper, the Dunder Mifflin packages will be emblazoned with slogans such as “Our motto is, ‘Quabity First’ ” and “Get Your Scrant on,” well-known phrases from the comedy series.

The marketing deal is an effort to combat what Quill’s chief marketing officer calls a “race to the bottom in the paper business.”

The Dunder Mifflin deal is an example of “reverse product placement.”

For decades, marketers have worked to embed their brands in the plots of TV shows and movies as a way to stand out in a crowded ad market. Nowadays, they are seeing value in bringing to life fictional brands that are already part of pop culture.

Examples include Bertie Bott’s Every Flavor Beans, a candy from the Harry Potter books, and Bubba Gump Shrimp Co. restaurants, inspired by the 1994 film “Forrest Gump.”

For Quill, which has a roughly $3 million annual ad budget, using the well-known Dunder Mifflin name is a way to draw attention to its brand without spending heavily on marketing.

Edit by ARK

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Bold move: Domino’s keeps the cheese in cheesy bread … Whew !

TakeAway: Despite the down economy, Domino’s resisted the temptation to take the cheese out of its cheesy bread.

Otherwise, I guess they would have had to change the name to just plain “bread”.

Not much sizzle to to that, huh?

* * * * *

Excerpt form AdAge: “Domino’s Introduces ‘Gourmet’ Cheesy Bread”

Domino’s is revamping yet another product: its cheesy bread.

The chain today begins selling three “gourmet” varieties — spinach and feta, bacon and jalapeno and cheese only — to replace its existing cheesy bread.

“In this economy, things are bad, people are cutting budgets,” said Domino’s CMO.

“The normal thing to do is raise prices and reduce quality. We’re making a purposeful effort to be on the side of consumers. We could take cheese out, but we put more cheese in and added more gourmet-type flavors.”

In this economy, “restaurant-goers are more demanding than ever, closely watching their food-service dollars and actively seeking the best overall value,” according to a recent Flavor Consumer Trend Report.

“In this way, flavor is more important than ever before.”

The report found that “more than two out of five consumers say they are more likely to try new flavors than they were a year ago, while 52% express a preference for restaurants that offer unique or original flavors, up from 42% of those polled two years ago.”

Edit by ARK

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Bad economy? … Jack up your heels.

TakeAway: IBM research shows a relationship between the height of women’s heals and the economy … the weaker the economy, the higher the heels..

* * * * *
Excerpt from AdAge: “At Last a Good Economic Indicator: Heel Heights Poised for Fall”

Historically in economic downturns heels have tended to go up and stay up, according, a consumer-products expert with IBM.

Why? Consumers look to compensate for dismal times with more flamboyant fashions.

Certainly that’s been true during the recent downturn.

Flats and relatively subdued heels of the 1920s gave way to the high heels of the 1930s recession.

Platform heels also soared during the recession fueled by the 1973 oil crisis.

Ominously, the average height of heels mentioned in social media soared from 3 inches in the first half of 2008 to 6 inches in the second half, just as the U.S. financial bubble burst.

Heel buzz most recently peaked in the first half of 2009 at 7 inches, bounced around at 4 to 5 inches through early 2010 and plunged to 2 inches in the most recent IBM analysis from early this year.

IBM’s cross analysis of heel-height buzz and macroeconomic data suggest a strong inverse correlation between heel-height buzz and economic growth.

Edit by ARK

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Nike tells Marty McFly: “Just do it !”

TakeAway: With a special-edition “Back to the Future” shoe, Nike helps to fundraise $9.4M for Michael J. Fox’s Parkinson Foundation.

* * * * *
Excerpted from brandchannel.com, “Nike ‘Back to the Future’ Shoes Raise $9.4 Million for Michael J. Fox Foundation”

When 1985’s Back to the Future blew the doors off of the box office – eventually generating $303.87 billion – two sequels were automatically set into motion and released in 1989 and 1990. And somewhere in there, someone got fully turned onto the joy of product placement.

Back to the Future II was particularly chockfull of brand names, including Black and Decker, Pepsi, Texaco, Mattel, Pizza Hut,  The Weather Channel, 7-Eleven, and AT&T, among others. But fans salivated most over the special shoe that Nike designer Tinker Hatfield created for the film, the Nike MAG shoe, with its glowing LED panel and an electroluminescent “Nike” for Michael J. Fox to wear as the film’s hero, Marty McFly.

Sneaker aficionados had been begging the company for years to release the same shoe to the mainstream. So in a highly-publicized eBay auction in September, Nike made only 1,500 to auction off on eBay to raise cash for Michael J. Fox’s Foundation for Parkinson’s Research. The result was $4.7 million from consumers, which a matching initiative doubled to $9.4 million.

“The enthusiasm this project ignited, and the funds and awareness the shoes generated for Parkinson’s research, are both humbling and inspiring,” Fox. “Our Foundation is truly grateful to Nike for this unique partnership that brought Back to the Future fans, sneakerheads and the PD community together in the quest to eradicate Parkinson’s from the space-time continuum.”

The first pair went to British rapper and “avid sneaker collector” Tinie Tempah, who shelled out $37,500 for the honor at a celeb auction in Los Angeles.

If you missed out and are looking to pick up some Back to the Future memorabilia while helping out Fox’s Foundation, you’re in luck. Technabob reports that auction house Profiles in History will sell off more than 100 items from the films in L.A. between Dec. 15 and Dec. 18. Part of the proceeds will go to the Foundation.

Some of the gear set to be auctioned off includes some futuristic Pepsi and Slice cans, Marty’s Mattel Hoverboard, the case from the Nike self-lacing shoes, and, yes, one of the seven awesome DeLoreans used during the filming. It would make an unforgettable holiday gift, don’t you think?

Edit by KJM.

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Creative marketing: Mickey D goes from “free” to “almost free” …

San Fran parents said kids were pressuring them to buy non-nutritious happy meals to get the free toys.

So, the San Fran city council passed a  law making it illegal for fast food chains to include free toys in happy meals.

According to the Wash Post, McDonald’s crafted a creative workaround: for 10 cents, patrons can buy a toy to go along with a happy meal.

10 cents isn’t “free” it’s “almost free”.

The kicker: all the dimes all go to charity - the Ronald McDonald Houses.

The downside: consumer behavior is such that there’s a big fall off in demand when a price is raised from free to almost free.

So, Ronald McDonald Houses probably won’t get much money from the program

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Now what happens at the club … really stays at the club.

TakeAway: Norte, a South American beer, is taking a new approach to protect its brand by protecting its customers from being in unbecoming pictures that could end up on the web.

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Excerpt From AdAge: “An ‘Intelligent Beer Cooler’ Will Destroy Dangerous Photos of You”

To protect its consumers from being branded as “dirty old men” or “floozies,” Norte Beer and agency Del Campo Nazca Saatchi & Saatchi recently handed out “intelligent beer coolers” throughout bars in Argentina.

The beer cooler is equipped with Photoblocker, a camera-flash sensor that triggers its own flash in response when a picture is being taken. The larger flash, in effect, destroys the picture. And the evidence.

Edit by ARK

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Buffett says: “The airline business is unusually treacherous” … no bleep, Warren.

With American Airlines filing for bankruptcy, seem like a good time to dust off a slide I use in my class re: airlines revenue management practices.

My students hear often that I think airlines are pricing masters.

Which begs a question: why is their profitability so low?

Warren Buffett’s answer:

“A great management in that business will not necessarily get a great result …

In the airlines, you have a huge amount of capacity … something close to a commodity product with high fixed costs and no marginal costs

Since that extra seat doesn’t cost you anything, the temptation to sell it at a terrible price is overwhelming.”

As a result, inflation-adjusted air fares have been essentially flat for decades.

Even extra baggage fees can’t save the day …

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Ken says: “get to the pocketbook first”

Last week I posted my talking points to a Wash Post reporter asking about retailers moving to Thanksgiving evening openings in advance of Black Friday.

I served up some ivory tower stuff about budget effects, shopping days’ effects, etc.

Here’s what made the cut …

Black Friday 2011: Holiday shoppers hit stores, with a Thanksgiving head start

Last year, Toys R Us became one of the first big-box chains to launch its Black Friday specials at 10 p.m. Thursday. This year, Wal-Mart matched the move.

So Toys R Us opened its doors even earlier, at 9 p.m.

“This is just the beginning,” said Ken Homa, professor of marketing at Georgetown University’s McDonough School of Business. “Next year, we’re likely to see everybody doing this. . . . The guys with the first opportunity to get to somebody’s pocketbook are likely to take share away from their competitors.”

Accurately quoted and, if I must say so myself, captures the essence of my message … and my style.

Probably a bit nostalgic for my former students …

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C’mon down: Brand USA cajoles international travelers to the U.S.

TakeAway: The NGO, Corporation for Travel and Promotion, is going to give USA a new global positioning that welcomes world travelers to ultimately drive economic growth.

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Excerpt from AdAge: “Promoting Brand USA: America’s New ‘Awesome’ Global Positioning”

The country’s new positioning comes courtesy of the Corporation for Travel Promotion (CTP), which hired JWT to handle a global marketing campaign and to create a logo for Brand U.S.A.

The goal is to promote leisure and business travel in order to drive economic growth and job creation.

Based on the first glimpses of the CTP’s strategy, they are leaning heavily on creating content, such as this website that houses travel itineraries for different U.S. cities.

The site also links to several partners in the effort, among them: federal agencies related to tourism, transportation companies, travel agencies, and tour operators. Another major part of its push appears to be social media, with fan pages on Facebook for different cities.

It’s going to take a lot more than a few day-trip suggestions and “likes” on Facebook to get tourists.

Pew Studies in recent years have shown America’s image declining not just in parts of the world where anti-Americanism runs rampant.

The CTP is planning to launch a worldwide push in March, which it calls “the first-ever coordinated global marketing effort dedicated to welcoming international travelers to the United States.”

Edit by ARK

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Black Friday … it’s all psychological.

Punch line: According to the Washington Post, “far from being mass synchronized temporary insanity, the Black Friday ritual has distinct psychological underpinnings.”

1) The crowds (and scarcity) make us happy

When crowds create a sense of competition — such as when hundreds of shoppers are rushing to collect marked-down goods — they generate a different feeling … called hedonic shopping value, or a sense of enjoyment from the mere process of buying goods.

Consumers enjoy something that’s harder to get, and it makes them feel playful and excited.”

create a promotional strategy that has a high value for a limited time.”

2) We love the hunt

Black Friday is “hunting for women” … it hinge on long-standing traditions and involve pursuing a goal as a group. Whether the group actually hits its target is secondary to the fun of the chase.

The process is akin to a marathon, in that a long-distance runner is energized by the grueling trek in much the same way a Black Friday shopper thrives on long lines and frenzied grabs at cashmere sweaters.

Shoppers love to swap stories and show off their prizes at the end of the day.

“It’s ‘mission accomplished … You brag about your great deal, or about how you got the last one.”

3) It’s about togetherness

Black Friday shopping combines elements of both traditional shopping and holiday rituals.

Shoppers planned extensively for Black Friday — as they would for a holiday meal — and relish the day in part because it allows them to spend time with close friends and family.

“Sharing the shopping ritual with family members and indoctrinating children helps to ensure that the ritual is continued in the next generation.”

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DIY Shoppers…..RadioShack is Sorry!

TakeAway: RadioShack’s emphasis on  mobility products (aka. cell phones) turned away their core customers – parts & gadget buyers. Now, RadioShack is trying to get these customers back.

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Excerpt from AdAge: “RadioShack’s Journey to Bring Back a Forgotten Customer”

In a candid presentation, RadioShack’s CMO Lee Applbaum described how the marketer abandoned its core do-it-yourself customer, in a bid to embrace mobility.

As the mobility business grew, the “signature” business, which includes things like accessories and power products suffered, falling from 38% of the business in 2009 to 32% in 2010.

Shareholders and analysts took note of decline, considering the category has very high margins, drives frequency and encourages loyalty.

Initially, RadioShack told itself that people just weren’t buying those products anymore.

But, as evidenced by the Wired article and a slew of blog posts, it quickly became clear that wasn’t the case. 

“For all the work around the rebranding, we didn’t spend ample time understanding our customers.”

Once RadioShack acknowledged the problem, it moved quickly to re-establish connections with the DIY shopper.

RadioShack began asking those consumers what they wanted, reaching out via its blog and social media. The response was swift.

A program called “The Great Create” leveraged RadioShack’s roots and attracted 110 million impressions in the first 30 to 45 days.

Edit by ARK

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