Revisiting Competitors as Stakeholders

By far, the most popular posts on this blog are the two I wrote about whether a company, as it develops a marketing plan, should consider its competitors to be stakeholders.

In one post, I wrote:

The usual suspects listed as stakeholders are: customers, employees/managers, owners/shareholders, government (regulators etc), members of the media, securities analysts, suppliers, special interest groups, and labor groups.

The idea is that when you make a company decision, you should consider how that decision will influence or be influenced by your stakeholders. Makes sense, especially in this age of increasing transparency and with stakeholders finding new ways to make sure their voices are heard online and off-line.

Now consider whether your list should include competitors. Every company's performance is affected by what its competitors do...and every company affects, however indirectly, the performance of its competitors.

In a second post, I wrote:

Of course, competitors are legally forbidden to discuss and coordinate pricing plans and activities (at least in the U.S. and Europe). But that doesn't mean a company can't target a rival's customers or set a goal of dethroning the market leader. . . Both situations would certainly have an effect on the performance of the company and its rivals. In both situations, competitors would be stakeholders of each other.

Consider what happened this week, when Amazon introduced its new Kindle Fire e-reader/tablet computer. Jeff Bezos told the media conference: "We are building premium products and offering them at non-premium prices." Clearly, he's talking about how Amazon differentiates itself from Apple. The Kindle Fire is no iPad, but it will very likely affect Apple's performance this holiday season, just as Amazon's pricing of its streaming movies and TV shows will affect Netflix's performance  this holiday season. Then there's Research in Motion, which is struggling to sell its PlayBook tablet.

No marketer should focus on competitors as its main stakeholder group. Other stakeholders--especially customers--are much more important. Yet competitors have the ability to affect the performance of a single company and its entire industry, just as that company's actions can affect the performance of all its competitors and the overall indusry.

That's why Amazon, Apple, RIM, and Netflix have to keep an eye on each other as stakeholders. They target many of the same customer segments; their strengths add to a healthy marketplace for customers and for competition; their weaknesses open the door to new opportunities for each other.

How Hot Is Kindle Fire?

Apple won't be the only brand watching Amazon's new Kindle tablet/reader, announced on Thursday with much fanfare by Amazon's CEO, Jeff Bezos. The Fire is a bit larger than other Kindles and smaller than the iPad, and it builds on Amazon's vast library of books and entertainment, plus depending on Amazon's cloud storage.

Analysts and industry insiders have been talking about the price--only $199--and how it poses a major challenge to Apple's iPad, which is priced starting at $499. But other rivals are in the mix, thanks to Amazon's aggressive pricing.

Lenovo's smallest IdeaPad, also 7" and also capable of streaming movies, is--at $199--a head-to-head competitor to the Kindle Fire.

With the holiday shopping season about to begin, this will be an intensive two-month competition for consumers' attention and wallets. Admittedly, the iPad has much to recommend it as a laptop alternative, not a primary e-reader, and its price reflects the many bells and whistles (cameras etc) that the Fire lacks. But I still expect Apple to make some kind of competitive move before the year is over. What will it do?

Oh, and did I mention that Netflix will be feeling the heat from Kindle as well? Amazon is offering unlimited access to some 11,000 TV shows and movies for Amazon Prime customers (cost: $79/yr), along with a 30-day trial for Kindle Fire buyers. Given Netflix's recent pricing stumbles, Amazon may have found the right downloading lever for prying Netflix customers away--and the right hardware for sealing the bargain.

Still, some privacy advocates are concerned about the way in which Kindle Fire will route Web browsing via its cloud, logging and retaining info about users' browsing for 30 days. Opt-out is possible, apparently, but this aspect of the Amazon Silk browser isn't winning applause in many circles. 

Where's the Beef? It's B-a-a-a-ck

"Where's the beef?" has been a catchphrase for nearly 3 decades, since Wendy's famous TV and print ads in which actress Clara Peller examined competing burgers, looking for--well, the beef.

Now "where's the beef?" is back in a new round of Wendy's ads, this time for Dave's Hot 'n Juicy burgers. In this latest incarnation, "where's the beef?" is intended to suggest fresh quality as Wendy's battles its burger rivals, McDonald's and Burger King.

The Wendy's Web site is featuring founder Dave Thomas's quotes and his daughter's comments as well, linking the brand to its roots. At the bottom of the home page, Wendy's invites visitors to "be social" via the brand's Facebook, Twitter, YouTube, and MySpace pages. I wonder whether Dave Thomas would have been tweeting today . . . or making YouTube videos, the way Blendtec's CEO does with his famous "Will It Blend?" series?

Advertorials 2.0: Transparency Is Key

The lines between "editorial" and "advertising" are blurrier than ever.

In the world of print journalism, a page or series of pages with content sponsored by a company, brand, country, or other marketer is an advertorial. In tiny letters at the top of the page, you'll see words alerting the reader that this is advertising.

In the digital world, this kind of content is commonplace but no standardized way of identifying or presenting it has yet emerged. 

Another digital form of advertorial emerged last year, when Forbes initiated its Forbes AdVoices program. Marketers are invited to sponsor content that will be posted on the mag's site under the sponsor's brand banner. The magazine's explanation reads, in part:

Marketers can now tell their own story in their words on the Forbes platform using the same tools as content creators. They can develop relationships with consumers, thought leaders and journalists, too. On the Forbes platform, all content is clearly labeled and transparent. Everyone knows who’s talking and the vantage point from which they speak.

Initially, some critics were concerned that the advertorial disclosure might not be clear enough. "Forbes' New Ad Pitch: Wanna buy a blog?" asked Crain's New York Business.

Fast-forward a year. One recent AdVoice entry sponsored by Merrill Lynch, for example, was about investing in gold. Another, sponsored by SAP, looked at applying "gamification" to business issues.

New Media Age recently observed that some sponsored content can be just as popular as--if not more popular than--editorial. In other words, if the content has value for readers, it's a win-win-win for the site, the readers, and the sponsor, as long as the sponsorship is transparent.

Joe Fresh in New York

And New Jersey! "New classics inspired by the classics" is the motto of Joe Fresh, a cosmetics and clothing brand sold in Canadian specialty and superstores. Now the brand is coming to the New York metro area with flagships and fashion fanfare.

Joe Mimran, the man behind the brand, has already created and sold off a successful brand, Club Monaco, to Polo Ralph Lauren in 1999. His Joe Fresh brand has a touch of Gap (classics) mixed with a taste of H&M (stylish affordability).

Joe Fresh has gotten plenty of fashion mag mentions in the runup to its Big Apple invasion.

For its debut US ad campaign, the company bought the rights to David Bowie's song Oh! You Pretty Things rather than use original music, as it usually does. "We chose David Bowie because he's timeless, he's a visionary," explains Joe Fresh's creative director.

Twitter, Facebook, and YouTube are in the marketing mix for Joe Fresh's NY debut. How will Joe Fresh fare in New York's fashion mix?

College Radio Day 10.11.11

College Radio Day is scheduled for October 11, 2011. Why a special day to celebrate this particular medium?

The goal is to spotlight the importance and audience of college radio stations across North America, pushing to preserve the individuality and creativity of this media segment.

College radio traditionally had a loyal following, not just among students and faculty but among members of the public who wanted to listen to fresh voices, fresh views, and new music.

Yet students have so many media choices these days (including podcasts and online radio stations) that college radio lacks the reach it had in past decades, according to a college dean. In addition, some colleges are raising money by selling their station licenses (often to public radio stations), winnowing the ranks even further.

Designating a day to celebrate college radio is a good marketing move to call attention to this targeted medium. One month before the event, more than 240 stations have signed on to participate. Hundreds more are expected to participate next month. For the latest, check the special Web site, the Facebook page, and the Twitter account. And tune into your local college radio station on 10.11.11.

Happy 30th Birthday to the IBM PC

The IBM PC has just celebrated its 30th birthday--and it's hard to believe that the personal computer is already three decades old. Early models had monochrome monitors and floppy disk storage. The early Apple Macintosh computers were smaller and boxier, with an easier-to-use graphical interface instead of the DOS system used in IBM models. IBM sold off its PC division to Lenovo in 2005, but Apple continues to innovate Macintosh computers and increase its market share year by year.

After the PC came many other electronic gadgets, some with specialized functions and others providing PC convenience in new "packaging."

Remember the hand-held personal digital assistant? Palm and Handspring made their names on this product. Once the darling of the computer world, the product wound up as a short-lived stepping stone to smartphones.

These days, laptops, netbooks, tablets, and smartphones are commonplace, coexisting with desktop computers at home and in the workplace. The big battle, currently, is among tablet computers, where Apple's iPad is the undisputed leader. Will tablets remain popular or will it turn out to be an intermediate step toward some other electronic device, the way PDAs paved the way for smartphones?

Smart Strategy: Segmenting Your Pricing

PepsiCo's CFO, Hugh Johnston, recently spoke to an investors' conference about the company's segmented pricing strategy. Johnston explained that PepsiCo must "meet the needs of the widening gap between value, middle, and premium consumers" while simultaneously being responsive to higher price sensitivity among all segments.

So what's PepsiCo doing? Instead of adjusting pricing across the board to account for higher costs, the company has segmented its markets by channel, consumption occasion, and consumption needs.

For example, it offers 99-cent/1.5 liter bottles for consumption at home by smaller households and offers 20-packs of cans for special occasions when people gather, such as holidays or birthdays. It also offers 99-cent/16 oz. bottles in convenience stores and gas station markets for consumers in a hurry to grab and go. And it created a 7.5 oz. can for consumers who are "light users" of carbonated soft drinks at home--a tactic that lets Pepsi charge more per ounce while adding value by helping consumers limit the amount they drink.

Meanwhile, PepsiCo's ongoing rivalry with Coca-Cola is even fiercer, with US sales of carbonated beverages stagnating and consumers not spending as freely on extras as in pre-recession days. That's why Pepsi is also kicking its promotions into high gear, on Facebook, Twitter, and Youtube.

Digital Marketing Metrics--What's Out, What's In

Remember when click-throughs were the go-to metric for measuring the effect of Internet banner ads? Those days are gone. Here's a quick look at what's in and what's out in the world of digital marketing metrics these days:

• OUT: Measuring how many people open your marketing e-mails.
• IN: Measuring how many people click through to buy via a link in your e-mails. If sales measures aren't available, count how many people click a link within the e-mail to get more info or ask to have sales follow-up.

• OUT: Counting how many Facebook "likes" your brand collects.
• IN: Counting how many users participate in your Facebook-based brand promotions by redeeming discount coupons, etc.

• OUT: Assessing changes in brand awareness as the bottom line of a campaign.
• IN: Assessing not only brand awareness but also lead generation and conversion to sales, wherever possible.

• OUT: Counting the number of eyeballs.
• IN: Counting the number of target-market customers and prospects you actually engaged.

• OUT: Looking at digital transactions.
• IN: Looking at digital relationships and customer lifetime value.

Metrics have to help you dig deeper to understand what effect your digital marketing activities are having on your audience and whether you're making progress toward your objectives. Attitudinal measures are important, but behavioral measures are even more valuable, especially customer behavior over time.