Friday, February 5, 2016

Super Bowl 50: Super Ads?

The pressure is on advertisers to, well, not drop the ball during the Super Bowl. “You want to make sure you're representing your client's brand in the best way possible,” says the head of the ad agency that produced Kia's Optima ad (starring Christopher Walken, above). That means delivering a memorable ad that adds to the brand's reputation or buzz, no lawsuits in sight.

This is a milestone year for the football championship. Will it be a milestone year for bowl ads? Already, marketers are sizing up the size of their response by releasing ads online ahead of the game. CBS is even touting the ads to be posted on game day and promising a fan vote finish for audience involvement.

For insights into how behavioral science is applied in Super Bowl ads, take a look at this fascinating Ad Age piece. And don't forget the perennial approaches that have attracted viewers in the past, such as "see our banned ad."

On Sunday, which ad will score the most audience touchdowns? Which brands will do the best in social media?

Wednesday, February 3, 2016

Back to the Retail Future: Will Amazon Invest Heavily in Stores?

One reason Amazon can charge such low prices is its relatively low overhead compared with brick-and-mortar stores. No rent, no large employee roster, no fixtures, no electricity. Amazon just posts a photo and description of the merchandise and patents its 1-Click purchasing process. As orders pour in, Amazon can mine the data and use the analysis to plan future marketing initiatives. Slim profit margins work fairly well in this situation.

Last year, Amazon opened a real book store (shown above) stocked with books rated by customers as 4 or 5 stars, plus Amazon's branded gadgets (Kindle for instance). The idea was to study in-store customers, analyze their buying patterns, gain experience with visual merchandising, and see how different products do in the store.

Now Amazon is reportedly looking at a serious store-retailing presence, maybe in malls. Of course, having devastated the retail book business, Amazon's competitive situation is quite different if it enters traditional store retailing in a serious way.

Online, Amazon is such a powerhouse that other retailers are testing different ways to compete online and off-line. One example is the testing of click-to-buy and collect the package free at the store as a way to compete with Amazon, even though that sometimes raises costs and slices margins. Other competitive moves include the use of apps to speed shopping and improve convenience.

If Amazon moves into a nearby shopping area, the competitive landscape will change drastically. Again.

Saturday, January 30, 2016

Marketing Barbie's Latest Makeover

Iconic Barbie, the doll beloved by boomers and still on toy-store shelves after more than 50 years, is getting a needed makeover. Despite her high fashion forays, and several museum displays devoted to her fashionista variations, Barbie has been criticized for her unrealistic, ultrathin body type and shaped feet that fit only in high heels. 

Facing increased competition from many other dolls, sales of Barbie dolls dropped 20% from 2012 to 2014, prompting parent company Mattel to add new diverse product variations for 2015 (a wider range of skin tones and hair styles).

In 2016, Mattel has introduced even more faces and shapes to update the Barbie product line. Barbie now is short or willowy, slim or curvy, to appeal to a wider target market and better reflect the diversity of the toy buying public.

Some of Mattel's Barbie ads in the past year have emphasized the aspirations of girls, aiming to associate the brand with dreams of career possibilities. Other ads focused on fashion and expressing individuality. Will Barbie's latest marketing makeover reverse the sales slide?

Tuesday, January 19, 2016

More about Marketing to Millennials

So many marketing plans target Millennials that it's worth looking at some recent research about this key market segment.

  • As shown in the Pew Research data at left, Millennials have a very positive view of the role of small businesses in America, and the role of technology firms. Millennials are, like the rest of the nation, not as positive about the upside-impact of national news media.
  • Millennials are using their ever-ready smartphones for all kinds of functions, not just selfies but of course mobile banking as well.
  • Loading prepaid cards with money to spend is another Millennial behavior. 
  • Personality is a big part of the appeal to Millennials when they consider foods and beverages. No big, boring, bland corporate stuff backed by conventional advertising, please.

Thursday, January 14, 2016

When Will the Shakeout Hit Mobile Payment Systems?

Innovative technologies bring a messy beginning to industries, as entrepreneurs tinker in their garages (literally, in many cases) and start businesses to commercialize their products. Think of the car industry, where 253 auto manufacturers operated in 1908. Or the computer industry, where in the 1970s, big names included Wang, Apple, Tandem, Commodore, even Tandy Radio Shack.

Apple Pay
In every case, a shakeout reduced the ranks and consolidation brought the strongest survivors together. For cars, the shakeout began in the 1920s: By 1929, only 44 automakers were in operation--and the Great Depression of the 1930s narrowed that number even further. For computers, the revolution came in the form of IBM, which introduced its personal computer in the 1980s. Brand proliferation continued for a time, but soon the high cost of entry and competition prompted brand after brand to either drop out or be acquired. Same pattern in TVs. And on and on.

So when will this pattern emerge in mobile payment systems? Not in 2016, but soon, IMHO. A key element will be what the biggest brands are doing. For instance, Apple Pay has many bank and retail partners, it's high visibility, and it's concluding deals to launch in more countries. In other words, Apple will be a major factor in shaping this industry's immediate future.

New entrants continue to announce their own mobile payment systems. Walmart recently launched Walmart Pay, which operates through its Walmart app. The world's largest retailer is also participating in a mobile payment program devised by a group of retailers. JP Morgan Chase has Chase Pay scheduled to roll out this year. Target is in the same retail group testing mobile payments as Walmart, but it also is mulling a proprietary system.

Meanwhile, tech standards are in flux, consumers have a LOT of choices, and the roles of various players (banks, retailers, card issuers, telecoms, chip manufacturers, etc) aren't yet settled. Consumer acceptance of mobile payments continues to be relatively slow, in part due to security concerns and the multiple systems competing for adoption.

So no shakeout yet, but consolidation will happen sooner rather than later. And when it does, it will disrupt the marketing plans of every participant (while it shapes the behavior of consumers). Get ready!

Wednesday, January 13, 2016

Slower PC Sales as Buyers Stay Mobile


Sales of desktop computers and laptops actually dropped in 2015 as consumers and business buyers continued their migration toward mobile devices like smartphones and tablet computers.

Projections had previously indicated this trend would gain traction in 2015. Another reason for lower PC sales is that buyers are holding onto their equipment longer than in the past.

Above, IDC's chart of how the top five PC companies were doing in terms of market share, quarter by quarter from 4Q 2014 through 4Q 2015.

IDC also said there was growth, but only single-digit increases, in smartphone sales around the world during 2015. Still, the iPhone is also a worldwide winner, with many brand fans in China boosting Apple's sales in that market.

Even tablet computer sales weren't blazing hot, in part because of product line proliferation--meaning more choices, such as detachable tablets, hybrids, and larger smartphones that, in essence, double as mini-tablets. Decisions about which operating system to choose--Apple's iOS, Android, Windows, etc--complicate the buying process for many consumers and businesses.

When consumers buy fewer digital gadgets, retailers feel the fallout. H.H. Gregg, for instance, saw holiday revenues drop compared with the previous year, due to lower PC and tablet sales. Suppliers of accessories (such as cases, power cords, etc.) also feel the fallout, although they still attract buyers who need replacements for existing equipment.

If you're writing a marketing plan for a company that supplies this industry or a reseller that stocks such products, consider the trends and likely impact on your marketing situation for 2016 and beyond.

Sunday, January 10, 2016

Derived Demand in the Star Wars Economy

MAY THE MARKETING FORCE BE WITH . . . STAR WARS

Star Wars, The Force Awakens, has its own outsized economic effect. As of today, the Disney movie has exceeded $1.7 billion in global box-office revenue. It's currently the third-highest-grossing movie of all time. And the film hasn't been in theaters for a month yet. Even in China, where the older Star Wars movies are not pop culture icons, this new movie debuted with record revenues.

Of course, demand for movie merchandise is generally based, to a large extent, on the movie's popularity. In the case of Star Wars, merchandise tie-ins may very well have their own ultrahigh trajectory. Why? Because Star Wars is a long-established franchise with two generations (or more) of fans. It's become an evergreen franchise in most markets, independent of any new movies. Months before the new movie opened, Force Friday brought adults and children into toy stores for Star Wars merchandise, old and new, even when they were not sure who the new characters actually were.

Current day fans are incredibly vocal on social media about their likes and dislikes. On opening weekend, fans tweeted nearly 5 million times about the movie. Many blogged and tweeted about the news that Rey, the new female lead played by Daisy Ridley, was left out of the Hasbro Monopoly game (an error being corrected). Search for the hashtag WheresRey and you will see the comments. Derived demand is a force to be reckoned with in the Star Wars economy.

Wednesday, January 6, 2016

What Happens in Vegas . . . at the CES

What happens in Vegas, doesn't stay in Vegas, at least not this week at the Consumer Electronics Show.

If you're involved in marketing, you should be aware of the technologies and trends represented at this annual event. More than 3,000 companies show their latest goods and services in Las Vegas. More than three-quarters of the top retailers and the largest U.S. firms are there. Read the coverage, watch the videos and slide shows, just for a taste of tech today and tomorrow.

Some products on display are concepts only, others are in the launch stage. In all, you'll get a sense of where design is headed, as well as insights into how companies are applying consumer behavior research. Tech is driving new product development in categories well beyond traditional consumer electronics. So take a look:
  • The Internet of Things is in evidence, although the public may not be adopting these products as quickly as manufacturers had hoped. See a gallery here.
  • Above, a new LG refrigerator that lights up the interior with a knock. No more holding doors open and letting cold air out.
  • This isn't a car show -- or is it? Faraday Future has a concept car that looks cutting edge. Ford is talking about self-driving cars. GM is also talking about self-driving cars. Well, almost everyone is talking about them. Google is actually doing something about self-driving cars.
  • Tech-laden clothing--wearable technology--is here. Again.
  • Fitness (actually, wellness in general) continues to be a hotbed of tech activity. Just one example of many: Under Armour is introducing new fitness devices. 
Remember, derived demand (the idea that demand for one product is based on--derived from--demand for another product) may be a key factor if you're marketing a good or service related to any of these technologies or products. So think ahead and consider how any of these products may suggest new directions for your brand or offering.

Sunday, January 3, 2016

Marketing Trends in 2016

Whether you're starting a new marketing plan, revising an existing one, or planning for a product launch later this year, keep these 2016 marketing trends in mind, say the experts:
  • Ad blockers are increasingly the default for customers online. How will this affect your ability to reach target audiences? How will it affect tracking mechanisms and data integrity?
  • It's an ad, ad, ad, ad world on social media. How will users react (see "ad blockers," above)? What will the increased clutter mean for advertisers?
  • Segments can increasingly be niche because it's easy to identify and target segments that are small--even segments of one, based on behavioral tracking and other Big Data refinements.
  • Brands must be customer-obsessed or else. Remember management guru Peter Drucker? He famously wrote that "the purpose of business is to create a customer." Still true in 2016.

Sunday, December 27, 2015

Chipotle's Challenge: Crisis Management

Chipotle has had months of negative headlines over the contamination crises at some of its restaurants.

Search for "Chipotle AND crisis" and you'll find more than 2 million links. Some of these links relate to the E. coli outbreak in the Pacific Northwest, some relate to a norovirus problem in Boston. Many look at the company's management of this crisis.

Food safety is at the core of the crisis. When consumers eat out, they expect their food will not make them sick. And since Chipotle has made its reputation on the basis of natural food prepared fresh, this crisis is especially challenging.

The restaurant chain's reputation has definitely suffered. Rebuilding trust and reassuring customers that they can safely enjoy Chipotle's food will be a top priority in 2016, once the source(s) of the outbreaks have been identified and dealt with.

Chipotle's CEO has publicly apologized and outlined a number of steps to strengthen food safety. Yet until the outbreaks are out of the headlines, Chipotle's marketing activities can't get back into high gear.

Maybe one way to reassure the public and start to resture trust is for Chipotle's management to be seen (with their families) eating at local Chipotle's all around the country, every day, especially in restaurants affected by these outbreaks. That would go a long way toward reassuring consumers IMHO.