Thursday, July 25, 2013

Under Armour Races into Innovation

Yes, Nike and Adidas and Reebok are all well-established footwear brands, each with its own tradition of product innovation and large, loyal customer base.

But Under Armour, the darling of high-performance athletic apparel, sees lots of opportunity in specialized footwear with a distinctive USP--unique selling proposition.

In this case, Under Armour is promoting its new Speedform running shoes as "the holy grail of fit." And fit is a major benefit sought by serious runners.

Speedform has no seams, which means less rubbing or discomfort. And it's made in a Chinese bra factory, utilizing the facility's expertise in comfort and fit. Even if producing shoes in a bra factory seems unusual, it's clever marketing as well because it gives the media something to talk about. When you have 2.4 million Facebook likes and 218,000 Twitter followers, having something really unusual to talk about is a good thing.

Tuesday, July 23, 2013

Packaging and Public Health

How does packaging influence consumer attitudes? This is an especially vital question for public health officials trying to reduce the health consequences of smoking. In several nations, regulators are either implementing or considering rules that would prevent tobacco marketers from using eye-catching colors and graphics on cigarette packaging--or allow branding but require extremely large and graphic warning labels, like those below.

Australia instituted plain packaging for cigarettes six months ago, and one study early in the process suggests the change may be influencing smokers' attitudes.

Compared with smokers who had purchased cigarettes in branded, marketing-oriented packaging, smokers who had purchased plain packages were 66% more likely to think their cigarettes were of lesser quality than a year ago. Plain-package smokers were also 70% more likely to report lower satisfaction with their cigarettes. 

What's more, consumers found plain packaging even less appealing than packaging bearing graphic warning labels. "From a larger public health perspective, the aim of plain packaging is to reduce the appeal of branding — to make the health warnings stand out more," explains Professor Wakefield of Cancer Council Victoria in Australia.

Canada was the first nation to mandate graphic warning labels on cigarette packages. U.S. law puts tobacco products under the jurisdiction of the FDA, which is pushing for graphic warnings, but legal challenges from tobacco marketers have stalled implementation. Meanwhile, research indicates that "occasional smokers" would be the most influenced by graphic warnings on cigarette packaging, because they may not be aware of the health risks and might be open to the idea of quitting.

Thursday, July 18, 2013

Virgin and Innocent: Brand Names That Communicate

Sir Richard Branson came up with the "Virgin" brand when he was 15 and brainstorming record-label names. In this video, he tells the Wall Street Journal that "Virgin" was a little naughty and attention-getting--two positives for a record label, especially considering the competition at that time. Even today, Virgin's brand communicates an upstart, entrepreneurial attitude that reflects the founder's approach to business--all business, but not like everybody else does business.

At the other end of the brand-implications spectrum is Innocent, the name chosen for smoothies with no additives, just natural, healthy ingredients. "No nasties," read one early tagline. That about sums up the brand promise--which is why Innocent is such an evocative name and so appropriate for the UK company.

Despite Coca-Cola making a series of investments in Innocent, the firm has retained its cheeky attitude and independence, relying on its investor for support in areas such as becoming the official smoothie and juice sponsor of London's 2012 Olympics (where Coke was a major sponsor).

Tuesday, July 16, 2013

Captcha for Brand Marketing? Yup

Working with Solve Media, Unilever and MasterCard are using Captcha to communicate brand messages to, um, captive audiences. You know Captcha--those distorted words you're asked to type to prove you're not a machine when you want to post a comment online. All over the world, people face Captcha challenges hundreds of millions of times every day. Now Solve Media has harnessed Captcha to put succinct brand messages in front of Internet users on thousands of sites.

Above left, a typical Captcha--more readable IMHO than the usual phrases. At right, the branded message representing MasterCard. Given the option of trying to decipher words that are deliberately difficult to read OR typing "MasterCard Anywhere," I'd choose the branded message any time. And that's one of the advantages Solve Media cites as a plus for people reading the branded message and typing the brand answer. Another plus: the advertiser only pays when the message is typed correctly.

A Unilever exec points to the importance of staying "at the forefront of the advertising ecosystem, particularly in the digital sphere." This is only one of Unilever's many digital initiatives as the packaged-goods firm ups its investment to support its growth strategy.
For Unilever, it’s important to stay at the forefront of the advertising eco-system, particularly in the digital sphere.
For Unilever, it’s important to stay at the forefront of the advertising eco-system, particularly in the digital sphere.
For Unilever, it’s important to stay at the forefront of the advertising eco-system, particularly in the digital sphere.
For Unilever, it’s important to stay at the forefront of the advertising eco-system, particularly in the digital sphere.

Traditional advertising theory suggests that audiences need repeated exposure to messages to be able to comprehend them and process them in preparation for taking action. But I admit, this might get on my nerves if I ran across the same branded message two, three, or four times in a single day.

Thursday, July 11, 2013's Freemium Strategy

The mobile/FB game Candy Crush Saga is exhibit one in making freemium pricing pay off. Freemium is a pricing technique in which customers get the basic offering for free with the option of paying for upgrades or additional functionality. Most apps are freemium-priced, and many mobile games.

The UK game company is targeting women in the age group of 25 to 55 for Candy Crush, although others outside that demographic play, as well. You start by downloading the free version to see if you like it . . . and once you gain proficiency, you might want to pay a little for extra elements that will help you reach higher levels. The game itself is fun and deceptively easy, and the payments are small. 

This "sweet" game is played far and wide--about 600 million times every day, on iPhones or Android phones or Facebook. Nearly three-quarters of Candy Crush players use the free version. That means fewer than 30% pay to play--but those small payments add up.  Candy Crush reportedly earns about half a million pounds ($750,000) every day. The profit margin is extremely healthy, needless to say.

Not everyone admires freemium pricing. Some people raise concerns about the effect on usage of more traditional digital games that must be purchased to be played. They also wonder whether game marketers are tweaking games to improve the odds that players will pay up. "Coercive monetization" is the term one economist applies to freemium pricing.

Yet the high-profile success of some app marketers makes a compelling case for investigating whether freemium can be used for other goods and services.

Monday, July 8, 2013

Snapple Promotes . . . "Nothing"

"Snapple Issues Press Release About Nothing." That's the headline of Snapple's latest press release, announcing a sales promotion in which consumers can win, well, lots of nothing. And given the trendiness of irony, I think the promotion is low-key and clever.

The press release continues: Brand Researches, Plans, Ultimately Comes Up With Nothing.

As it turns out, winning nothing actually means winning no bills (cash prize); no airfare (free travel); no gas bill (free gas); and so on.

Snapple knows where its customer base likes to hang out: The brand has 2.7 million Facebook likes and16,700 Twitter followers. It's also active on YouTube.

The brand is part of the Dr Pepper Snapple Group, which owns more than 4 dozen soft drink brands, including 7Up, Crush, Hawaiian Punch, RC Cola, and A&W. The group's gross profit margin has been inching higher as sales edge lower in recent months, due to softening demand for soft drinks in US markets. The "Nothing" promotion seems designed to give Snapple a hipper, higher profile among thirsty younger consumers.

Wednesday, July 3, 2013

P&G's Line Extensions for Faster Cleanup

Few US consumers have the time or inclination to work long hours deep-cleaning their homes every week. Procter & Gamble has been updating products and packaging to give today's customers what they need for speedier spot-cleaning, based on studies showing how cleaning habits have changed.

"When we were kids, the majority of the country used to drop in some dish liquid, fill up the sink with water, soak all of their dishes and then after a bit of time clean them, rinse and place them in a drying rack," remembers the head of marketing for Procter & Gamble's Cascade and Dawn cleaning brands. "Today, consumers just don't have time for batch-processing."

Having observed customers up close and personal, P&G recently launched Dawn Platinum Power Clean dishwashing liquid, designed to soak foods off dishes in minutes, not hours.

Another P&G introduction is Bounty DuraTowel, designed to deliver the benefit of more absorbancy and making it easier to rip one hefty sheet off the roll in a hurry. The idea is that a busy consumer doesn't want to fuss with the roll; he or she just wants to snap a single sheet off when needed to deal with a cleaning project or an unexpected spill--and do it right the first time with one towel, not a handful.

Line extensions like these can potentially cannibalize sales within the existing product line but also have great potential to attract new customers--or at least retain current customers who might otherwise defect to another brand.

Yet the more choices consumers have, the more confused they may become. The challenge for marketers is to simplify the choice, clarify points of differentiation, and sharpen the focus on what's really relevant to the target audience.

Line extensions are only part of P&G's marketing plan for higher sales and profits. The firm is also reinforcing the connection between its many individual brands (Bounty, Cascade, etc.) and the corporate parent. If customers like and trust one P&G brand, they might try another P&G brand. Last month, P&G held a one-day sampling event in which it distributed 40,000 free samples in one day in the heart of New York City. Why choose Manhattan for this massive sales promotion? "It's the world's biggest stage," explains a P&G executive.

Tuesday, July 2, 2013

Axalta Races into Sponsorship

Take a look at Jeff Gordon's newly repainted NASCAR Chevy #24, shown here in the Poconos 400 with the colorful Axalta sponsor logo.

Who's Axalta?

Axalta used to be DuPont Performance Coatings, a long-time sponsor of Jeff Gordon's car.

Now the coatings business has a new owner (Carlyle Group) and a new brand identity.

That means Jeff Gordon's car is sporting a new look, different from the "rainbow warrior" look it had with the DuPont logo (see right). Even non-NASCAR fans know this car if they have young relatives with diecast cars fashioned after Gordon's model.

Axalta wants Gordon's car to stand out from the pack when fans watch NASCAR on TV. Continuing a sponsorship that was successful for DuPont gives Axalta a wonderful opportunity to gain recognition and build its image among fans and followers.

Gordon himself is enthusiastic about the new arrangement: "What’s meaningful to me is that the name is new, but this is the same company that took a chance on a kid in 1992," he says.