Friday, September 12, 2014

Goodbye Traditional iPod, 2001-2014

The product life cycle is very accelerated for tech products, but still it's a surprise and a disappointment that Apple is pulling the plug on its iconic traditional iPod.

My household has purchased 5 in the past 13 years, rejoicing as the profile became slimmer and lighter while storage expanded over the years. At home, at the gym, in the car, out walking, the iPod has been a companion and a convenient way to listen to music, audio books, and podcasts. No subscription fees, just a one-time purchase price and all the audio files I could fit (plus photos and other files). What could be easier?

As so many others have noted, the iPod wasn't the first digital music player. But the click wheel and easy connection to iTunes started a design revolution that had a ripple effect on tech products in many categories.

In the pantheon of must-have trendy gadgets, the white ear buds of the iPod stood out and made a design statement. The TV commercials and print ads were striking and stylish, not to mention entertaining. Often imitated, never duplicated.

No matter what happens with the Apple Watch product launch, the iPod will be missed. Its legacy will live on in the elegance of advertising and design of gadgets, including the Watch, and in the way new product launches are orchestrated throughout the industry.

Sunday, September 7, 2014

Uniqlo's Logo Makes the Front Page

Kei Nishikori is playing in the U.S. Open tennis tournament finals--and that's front page news for his sponsor Uniqlo, the Japan-based clothing retailer that's been expanding worldwide. With the goal of becoming the biggest clothing company on the planet by 2020, Uniqlo's marketing plan includes opening dozens of stores in America and other areas outside its Asian home region.

Uniqlo also sponsors Novak Djokovic--so when they played each other in the semi-final match yesterday, spectators saw Uniqlo's brand logo on the clothing worn by both of these top-notch tennis players. Uniqlo's chairman characterized the contest this way: "It's a dream match."

Above, today's cover photo of Uniqlo's US Facebook page (770,000+ likes). Both of these outstanding athletes are shown in photos all over the newspapers and magazines today, not to mention Web news pages and TV sports news. Uniqlo is reinforcing those images and the positive associations with its very visible red-and-white brand logo.

As of today, Uniqlo lists four names on its list of "Uniqlo Sponsored Athletes" page: golfer Adam Scott, tennis stars Nishikori and Djokovic, and wheelchair tennis star Shingo Kunieda. Watch for more sightings of Uniqlo logos as the brand continues to implement its marketing plan for growth.

Friday, September 5, 2014

Fast and Hot: Marketing Drive-Through Coffee

It's not your imagination: There really are more drive-through coffee places these days.

Not everyone has the time or the lifestyle for the full cafe experience. Just as drive-through purchasing is essential for the fast-food industry, it's increasingly a key element in the world of coffee. Taste is very important, but so is convenience and the ability to get a good cup o'joe when you're in too much of a hurry to unsnap your seat belt.

Seattle's Best has been implementing drive-through-only coffee locations since 2012. Independents are also marketing drive-through coffee, with various points of differentiation, ranging from bikini-clad baristas to stand-alone kiosks featuring--of all things--a goat. (That's Crazy Mocha in the photo above, opening its newest drive-through in the Pittsburgh area.) 

Starbucks has noticed the preference for speed and convenience, and many of its stores already have drive-through lanes. Now the chain is about to open smaller, limited-menu Starbucks Express stores, catering to commuters and anyone else who wants a latte or espresso hot and in a hurry.

Panera Bread is also adding drive-throughs for coffee and more, which should allow it to attract customers at all hours, not just the main meal periods. 

Wednesday, September 3, 2014

CVS's Marketing Plan for Branding and Positioning

The drug-store chain CVS announced seven months ago that it would ban cigarette sales in its 7,600+ stores as of October. The goal is to strengthen the brand's positioning on the core benefit of helping consumers be healthy. 

As part of its marketing plan for branding and positioning, CVS began removing tobacco products from its stores today, a month ahead of schedule. This attracted a lot of media attention because the retailer also changed its company name to CVS Health and initiated a smoking cessation campaign. According to the CEO, "The contradiction of selling tobacco was becoming a growing obstacle to playing a bigger role in health care delivery."

The company is promoting the results of a new CVS study showing that removing tobacco products from its stores leads some percentage of shoppers to kick the smoking habit altogether.

Its marketing plan calls for opening hundreds of new MinuteClinic in-store health facilities within three years, bringing shoppers in when a child has an earache or for other minor medical needs. Positioning CVS as the go-to brand for health could also further enhance its ability to expand private-label products, which typically yield higher margins than non-store brands.

The CVS move to drop tobacco this week comes as the media world is gearing up for Stand Up to Cancer on Friday night, a nationwide entertainment industry initiative to raise money for cancer research.

Thursday, August 28, 2014

Remember Store Credit Cards and Cash?

Credit cards remain a highly popular payment method in America. Thirty years ago, nearly every major retailer in America had its own proprietary charge card, usually self-funded but sometimes backed by a third party such as General Electric or Citicorp. Many consumers had wallets filled with cards from Sears and other mainstream retailers, happy to be billed once a month for purchases made all month--and happy to get catalogs and special offers only for cardholders.
About that time, MasterCard (originally Master Charge) and Visa began charging into the department store industry, seeking to be accepted at the point of sale. Looking at an old issue of Mart magazine, as of mid-1977, 32 out of the top 100 U.S. department stores honored MasterCard and Visa, compared with only nine of the top 100 department stores honoring the bank cards in 1974.

Fast-forward to the 21st century. Very few department and specialty stores operate their own credit programs these days. Most have sold their receivables to a third party, and accept all kinds of plastic at the point of sale. For example, Synchrony (formerly part of General Electric) provides private-label credit services to Walmart, JC Penney, and other retailers. Citi Retail Services provides private-label credit services to Staples, Office Max, Best Buy, and other stores.

Cash is still around, but some consumers prefer plastic or mobile payments. According to a new survey, Millennials are more inclined toward digital payments for small purchases, while Boomers will use old-fashioned cash for payments under $5. Gadgets like Square and Amazon's new Local Register make it easy for small businesses to quickly authorize card payments via mobile, so why carry cash?

Consumers know about digital wallets (Google Wallet, PayPal, Apple Passbook) but actual usage is still relatively low, according to research. Apps are helping to fuel mobile payments. Will your wallet have any credit cards by 2020? Will you even be carrying a wallet with dollar bills and coins?

Friday, August 22, 2014

Instant Cameras in the Digital Age?

A few years ago, a South Korean soap opera ignited a fad for cute, compact instant-photo cameras made by FujiFilm. The Cheki has been on the market since 1998, and after a strong start, sales plateaued as smart phones and tablets took center stage.

Then the soap opera featured characters using the handheld camera, which prints business-card-size photos in moments, and celebrity-watching teens took notice and began buying. And yes, the camera requires film--a novelty in itself (and another way to gain revenue month after month once consumers buy the camera).

The Cheki (and its later sibling, the Instax Mini) have been marketed through Walmart, Amazon, and other US retail outlets. Cute, stylish, unusual, and attention-getting. FujiFilm itself has been savvy in transitioning strategy for the digital age, diversifying beyond film products and getting experience in electronic technologies.

Polaroid pioneered the instant camera market...then suffered a series of financial setbacks as the photo industry evolved and digital alternatives became affordable and popular. The Polaroid brand lives on, with a range of imaging products that includes instant cameras and, brand-new, a lightweight Cube video cam made specifically for sports activities. So a brand that made its name in film cameras has wound up with film and digital imaging equipment.

Sunday, August 17, 2014

New Life for Lassie the Iconic Brand

Lassie became part of mainstream pop culture in the early 1940s, when the movie Lassie, Come Home was a big box-office hit, based on the popular Saturday Evening Post story.

After a profitable film career, Lassie arrived on the little screen as a 1950s TV series that lasted for nearly 20 years--and episodes may still be playing in reruns somewhere on the planet. Descendants of the original "Lassie" (real name: Pal) have portrayed the character for decades. Because Lassie is trademarked, any dog in the role must, legally, have four white paws and a sable-brown body, a white blaze atop the nose, and a lush collar of white fur.

These days, Lassie the iconic brand is looking for new life. Owned since 2012 by DreamWorks Animation, Lassie has been making the rounds of media outlets to attract attention and keep the brand in the public eye, even if this is "the world's most famous dog."

According to research commissioned by DreamWorks, Lassie has very high brand recognition among US consumers and is associated with attributes like loyalty. Nielsen's research shows that 70% of the respondents to a survey in China recognized the Lassie brand (iconic, indeed).

The previous owner of the Lassie brand had recent licensing deals with pet-food manufacturers and dog accessory marketers. But is Lassie the 21st-century brand relevant in a digital world where LOL Cats take center stage? Can Lassie bring home the big bucks for DreamWorks in the form of merchandising and licensing? Stay tuned.

Thursday, August 14, 2014

Entrepreneurs Run with Sneakerization

Entrepreneurial marketers like Bucketfeet and Lechal are taking advantage of the ongoing trend toward sneakerization, the development of hundreds of niche markets within a particular product category. The obvious example is sneakers, which used to be canvas shoes with rubber soles, usually equipped with laces. If you were lucky, you had a (limited) choice of colors.

Today, of course, there's no such thing as a prototypical sneaker. Thanks to sneakerization, there are shoes for every sport, activity, season, age, personality, lifestyle, climate, you name it.

Bucketfeet shows sneakerization in action for the niche of people who want to wear art on their feet. The company recruits artists from around the world and pays them royalties based on sales of sneakers bearing their art.

Bucketfeet shoes are now in Nordstrom as well as being sold directly to customers online from the Bucketfeet site.

Buzz is important for young brands, and Bucketfeet is active on Pinterest, among other social media networks. The brand's slogan is "We believe art is for everyone." But the shoes also have functional benefits that appeal to buyers, as shown at left.

Lechal is taking a different approach. It's segmenting the market by technology involvement. Lechal sneakers are designed with Bluetooth built in so wearers can track their activity and be guided on foot to walking destinations via data from Google Maps.

Originally designed for visually-impaired wearers, Lechal shoes (the brand means "let's go") appeal to the wearer's sense of design and personality as much as to his or her preference for cutting-edge tech gadgetry. Navigation, fitness tracking, fashion--all in one shoe.

Sunday, August 10, 2014

Boeing vs. Airbus: Whose Strategic Vision Is Becoming Reality?


Eight years ago, I wrote my first-ever blog post, "The Future, According to Boeing and Airbus." My point was that the two competing jet manufacturers had entirely different views of what air travel would become in the future, and those visions fueled their product planning and marketing strategy. At the time, I believed Boeing's prediction that passengers would prefer to fly regional jets, point-to-point, rather than Airbus's vision of jumbo jets flying hub-to-hub.

Today's New York Times has a long article about just this topic. The marketing chief for Airbus's jumbo A380 is quoted as saying: “The A380 is not made for every route, but it is ideal for high-traffic routes, high-volume routes that are congested, or where there are flying constraints.” Airbus designed its jumbo jet specifically for a vision of the future in which airlines would fly large groups of passengers from one hub city to another, and then the passengers would fly on smaller planes to their final destinations.

Unfortunately for Airbus, that future has not become a reality. The company's biggest A380 airline customer, Emirates, has invested heavily in these jumbo jets for hub-to-hub flights. Its 380s have luxury touches that appeal to affluent business and first-class passengers. Very few other airlines have followed the Emirates model, however, in part because their customer base is different and in part because airports must make some modifications to welcome the A380.

Meanwhile, Boeing's vision of point-to-point flights has become the reality for many airlines and in many parts of the world, and that's the vision it followed when originally designing the 787 and tweaking the 777. The 777 has attracted 245 orders already in 2014.

Still, the 787 Dreamliner has had a bumpy launch, with high-profile battery problems and  reliability reportedly at only about 98%, compared with more than 99% for the well-established 777.

What next for the Airbus A380 and Boeing 787?

Wednesday, August 6, 2014

What's Next for Off-Price Retailing?

Loehmann's, one of the original off-price retailers, went bankrupt last year and its logo has disappeared from shopping centers everywhere. In its heyday, New York-based Loehmann's was the go-to store for high fashion at low prices, and an early proponent of bullpen dressing rooms, which keep costs low so prices can be low. Syms, another New York area off-price retailer, is also gone. Hit or Miss, an early Massachusetts-based off-pricer, is long gone.

But T.J. Maxx is not only alive, it's thriving. It's survived tough economic times and tough competition. Beth Kowitt, writing in Fortune's latest issue, asks the question: Is T.J. Maxx the best retail store in the land?

Kowitt makes a very convincing case, and I agree with the 7 key points she lists:
  1. Shoppers are looking for "new" merchandise, not "sale" merchandise. Yes. This is a major reason for the success of Costco, Zara, and other strong retailers, not just T.J. Maxx. Store traffic is vital, and shoppers enjoy the hunt, so new inventory has to be added every few days to keep the hunt going.
  2. Give shoppers treasure to hunt for. Costco is famous for this. T.J. Maxx also stocks some special products, but not in the same product category as Costco.
  3. Know what to buy and buy advantageously. This is what made Loehmann's reputation in decades past: Its buyers knew what to offer and when to make an offer to acquire special merchandise for the treasure hunt. Fast-forward to the 21st century: T.J. Maxx has its buyers constantly searching the marketplace for the next opportune buy.
  4. Get close to suppliers and order merchandise for yourself. No, there's not enough off-price merchandise to go around. That's what the other off-price retailers discovered as they tried to expand to keep up with shopper demand. T.J. Maxx wisely makes buys for inventory purposes, not just during mid-season or off-season opportunities.
  5. Make big buys. Today's apparel manufacturers appreciate the financial possibilities of purchases made by off-price retailers. Money talks, and T.J. Maxx has the money to make important buys (see #3 and #4).
  6. Build supplier relationships. Knowing that shoppers covet brands (see #2), T.J. Maxx will work with suppliers. Of course price is carefully negotiated, but without good supplier relationships, no retailer can accomplish key points #2 and #4.
  7. Give the leadership reins to a real retailer. T.J. Maxx's CEO, Carol Meyrowitz, is a seasoned retailer with the know-how and the experience to keep the company moving forward day after day, no matter what happens to the economy and the competition.
My big question: What will T.J. Maxx do as more shoppers move to mobile and digital shopping? Part of the buzz of an off-price chain depends on bringing shoppers back to the stores week after week in the hunt for "new" things at low prices (see key point #1) and treasures (point #2). Off-price does not operate using the same retail model as Gilt Groupe, for instance. Sometimes shoppers just have to go to the store and walk the aisles in search of that special bargain.

T.J. Maxx is definitely social: It has more than 2.2 million FB likes and 28,000 Pinterest followers. And the parent company has begun addressing online retailing in some divisions. What's next?