Pepsi and "Performance with Purpose"

As part of its "Performance with Purpose" strategy, PepsiCo has three types of product portfolios. One is "fun for you" foods and beverages like Mountain Dew. The second is "better for you" products like Baked Doritos. And the third is "good for you" products like Naked Juice.

 Just a few days ago, it acquired Bare Snacks Inc., which markets Carrot Chips, Apple Chips, and other crunchy snacks made from fruits and veggies. This acquisition expands the pantry of "good for you" products.

http://www.nutritiongreenhouse.com/

In the beginning, Bare Snacks produced apple chips and other products from its own organic apples. The company recently said that no matter who acquired it, Bare Snacks would stay true to its strategy of producing fruit and veggie snacks that taste good, as well as being healthy.

PepsiCo is also using a "brand incubator" to encourage small businesses to pursue "good for you" food and beverage innovation. In addition to money, the entrepreneurial brands enrolled in the Nutrition Greenhouse incubator receive mentoring to grow their businesses.

Nestlé and Ferrero Shape Up US Product Portfolios

Nestlé USA, whose parent company is based in Switzerland, just announced the sale of its U.S. candy products to Ferrero. Included are the familiar brands shown above.

Not included are the iconic Toll House products and even more iconic KitKat chocolate products. Interestingly, Nestlé doesn't make or market the KitKat bars you buy in U.S. markets--those are made and marketed by Hershey.

This acquisition puts Ferrero into the number-three slot among US candy marketers, behind Mars and Hershey. Ferrero has actually been on a buying spree, picking up Ferrara Candy and Fannie May in 2017. Ferrero already owns well-known brands like Nutella and TicTac, marketed for decades and popular with loyal customers. 

Both Nestlé and Ferrero view their product portfolios from a global perspective. What sells well and where? Where and why are products not just popular but profitable? And what are the long-term prospects for growth? Nestlé is reshaping its portfolio as it sets profit goals and examines consumption and buying trends. Ferrero is looking ahead to production expansion and technological innovation being drivers of sustainable growth. 

Shopper Marketing Coordinated with Social Media Marketing

With Halloween approaching, store displays and social media accounts are promoting the season with limited-edition pumpkin-spiced products and Halloween treats galore.

Above, packages of a limited-edition Hostess baked treat displayed on a supermarket endcap. These Glo Balls are a seasonal variation on the brand's Sno Balls products. Interstate Bakeries acquired the Hostess brands in 1995 and changed its corporate name to Hostess in 2009. More than 1.2 million brand fans have clicked to like the Hostess Facebook page.

Another familiar technique for shopper marketing is to use a seasonal point-of-purchase display. This Hershey Halloween cardboard display, at the front of a supermarket, has plenty of room for family-sized bags of Hershey-branded candies, for home or for trick-or-treat give-aways. The company also promotes recipes and crafts featuring its branded chocolates on the web and social media. Nearly 10 million people have liked Hershey's Facebook page, by the way.

Finally, an unusual pumpkin-spiced product: Gouda cheese, found in the supermarket's cheese refrigerated case. Only for a limited time. Not the usual autumn flavor combo, to say the least.

Marketing Electric Cars to Green Buyers

Tesla has had considerable success targeting green car buyers as it markets its initial two models of luxury all-electric cars, priced about $70k and up.

Now its biggest challenge is to meet the expected tsunami of demand for the popularly-priced all-electric Tesla 3. Starting at about $35,000, this stylish sedan is priced at half of what the other Teslas cost, yet it also carries the cachet of the Tesla brand, no small consideration. So Tesla has been active in the bond market to raise funds for the steep production increase needed to keep up with Tesla 3 demand.

Meanwhile, Tesla is booking way more than 1,000 reservations for the Tesla 3 every day. Delivery won't be for at least a year. This gives competitors like the Nissan Leaf time to appeal to buyers who want to drive green cars. Nissan is leaking bits and pieces of its new 2018 Leaf design to build anticipation and interest.

California is doing its part to encourage green buyers--it's looking at big rebates for all-electic and plug-in hybrids. This would bring the price of electric vehicles down to a level where mainstream buyers would do the math and see the financial benefit as well as the environmental benefit. 

Theme Parks Leverage Global Brand Franchises

https://www.usj.co.jp/e/attraction/

Harry Potter, as a brand franchise, is helping Universal Studios up its attendance in Florida and Japan (and it's doing quite well in Japan). Minions, as a brand franchise, is also giving Universal a unique draw in Japan. And guests are actually spending more per visit, even as Universal experiments with outdoor events during winter months.

Disney--traditionally the market leader--is expanding its brand franchises as competitive tools to keep attendance growing. Star Wars is a tried-and-true draw. Now Disney is also opening Avatar attractions. For an infographic illustrating the evolution of Disney's theme park/movie brand doings, see here. Interesting, Disney Tokyo is both popular and crowded, which is affecting foreign tourist attendance (not in a good way). For an unusual look at Disney and theme parks (namely, what didn't get built), see here.

More theme parks are opening year after year to satisfy international interest in exciting rides, water parks, and entertainment with branded elements. Warner Bros., for instance, is partnering to create a theme park in Abu Dhabi, featuring two brand franchises: Gotham City (Batman) and Metropolis (Superman).

In the high-stakes world of theme parks, where attractions run into the millions of dollars to design and develop, companies are competing with some of the most fascinating new rides ever. Brands are a key way to bring in fans who know and love the franchise...but the rides have to deliver if the parks are to enjoy all-important word of mouth.

Shinola as Brand Umbrella

How many product categories can fit under the Shinola brand umbrella? The Detroit-based company that owns Shinola, which has been marketing products for 5 years, continues expanding into new categories as it taps into demand for made-in-America products*. (Above, one of the facilities in Detroit where Shinola products are made.)

Shinola's website currently features:

• Watches 
• Pocket knives
• Turntables (for vinyl fans)
• Leather goods (for men and women)
• Journals (for writing)
• Bicycles (of course)
• Ping-pong paddles and other assorted "supply" items
• Coming soon: A Shinola-branded hotel in Detroit (2018)

Chief marketing officer Bridget Russo explains the appeal of Shinola: "Provenance is important to the consumer, not just where a product is coming from, but the story behind it."

Shinola has a lot of brand fans and is all over social media. Its Facebook page has nearly 100k likes, and it has a very active Pinterest account, plus nearly 140k Instagram followers and nearly 41k Twitter followers.

The brand is well known and has a positive image. But how many different categories can fit under its brand umbrella? Is a hotel, for example, a category too far?

*FTC concern about the requirements for a "made in America" designation has caused Shinola to change its marketing and clarify more explicitly that products like its watches are "built in Detroit" from "Swiss and imported parts."

Marketing Private Brands

Private brands--also known as private-label--are created or owned by retailers and other channel intermediaries.

Supermarkets are heavily into private brands, as are many general merchandise retailers like JC Penney (which owns Arizona, shown at right). Why? Because these are exclusive to the store and, just as important, they have higher profit margins.

Twenty years ago, an article in the Harvard Business Review said:

... private-label strength generally varies with economic conditions. That is, private-label market share generally goes up when the economy is suffering and down in stronger economic periods.

Today, however, the economy is strengthening and so are private brands. For example:

• Kohl's is seeking a turnaround based on private brands such as Sonoma, Croft & Barrow, and others that are or have been mainstays of its revenue base. However, how will this resonate with shoppers seeking well-known national brands?
• JC Penney is also putting more emphasis on private brands such as St. John's Bay and Arizona as it seeks a turnaround. In 2015, private brands accounted for 52% of Penney's sales--but by 2019, the marketing goal is to have private brands contribute 70% of Penney's sales.
• Target wants shoppers to prefer its private-label food products, marketed under brands such as Market Pantry and Simply Balanced.

Private brands are here to stay. The question is, how much emphasis is too much emphasis?

Background on Brands

 B R A N D  R E S E A R C H

Researching a brand for your marketing plan? Search the Web for research about that brand and its main competitors.

As you click through the results of your search, pay attention to where/when/how each research study was conducted. Also look at research results over time--how has the brand's ranking changed? What issues affect the brand's standing year by year? These clues can help you better analyze the brand as you continue your marketing planning.

Here are just a few resources focusing on brands, branding, and public perceptions:

• YouGov BrandIndex. "Tracking public perceptions of thousands of brands across the world every day." That's how YouGov describes this site, which covers many brands in many markets through ongoing interviews with millions of consumers.
• InterBrand Best Brands. Interbrand ranks brands within and across countries, with both global and national lists of the best brands.
• Fortune's rankings. In addition to the Fortune 500, the magazine presents rankings of "most admired" companies, fastest-growing companies, and other key lists to consult.
• Gallup research on brand engagement. Research examines multiple aspects of brands and customer involvement, including reactions of Millennials.

Millennials and Marketing

An online search for "Millennials and marketing" shows more than 22 million results. (If we could have searched online for "Boomers and marketing" 30+ years ago, there would have been a similar result.)

Millennials are the target market for many goods and services, with distinct needs, wants, preferences, attitudes, and behaviors. Stereotyping won't work--research is key. Brands that do their homework and get it right can win loyal customers. Brands that don't listen or respond will fall out of favor and have to run hard to catch up (if they can).

Here are some recent articles and analyses about marketing to Millennials:

• Why brands are getting it wrong (Social Media Week)
• What brands need to know (American Marketing Association)
• Tips for marketing to Millennials (CIO mag)
• Brands are trying too hard (Bloomberg)
• Millennials are the economic future (Inc.)
• Millennials and direct marketing (MediaPost)
• Busting myths about Millenials (CNBC)

Brands Ride Along with Disney's Theme Park Expansion Plans

Walt Disney has a new theme park, Shanghai Disneyland. PepsiCo was at the opening, with a limited-edition.

PepsiCo also partnered on a branded stage inside the Shanghai park. Four years ago, Pepsi opened a special R&D center to develop products that fit the taste buds of customers in China. Working with Disney furthers PepsiCo's expansion in China.

Starbucks is another brand that sees opportunity in working with Disney. In Shanghai at the Disney Resort, Starbucks just opened what will be its busiest coffee shop in the world, with 110 baristas to serve 25 million customers yearly. Starbucks already had a presence in each of the Disney parks in Orlando, and in Disneyland California.

These are only two of the global brands that are riding along with Disney's marketing magic in its global expansion. One more brand enjoying the ride is Hasbro, which won the lucrative doll license from Mattel and now produces princess dolls and other toys based on strong Disney brand franchises like Frozen.

Brand Rankings in 2016

So many ways to rank brands! Some authorities rank on the basis of brand value, some on the basis of performance, and on and on. In Fortune's recent listing of world's most admired companies, the top three were well-known US brands:

1. Apple
2. Alphabet (you know, Google's parent)
3. Amazon

Here's a selection of how other sites rank US brands of various sorts.

• Consumer Reports ranks vehicles here.
• US News & World Report ranks vehicles in four categories (cars, trucks, SUVs, luxury) here.
• Kelly Blue Book ranks car brands on the basis of image and value here.
• Laptop magazine ranks the top laptop computers here.

Hot Sauce Marketing Heats Up

Once upon a time--after the Civil War and into the dawn of the 20th century--Tabasco had the hot-sauce market to itself. Its famous concentrated pepper sauce spiced up bland foods drop by drop. Banker Edmund McIlhenny founded the firm, and his 2d great-grandson, the current head, sums up the original venture this way: "There was no commercially sold hot sauce before Tabasco. Edmund invented the category."

The now iconic Tabasco bottle is an example of early recycling in action: McIlhenny originally used discarded cologne bottles for his sauce because they were readily available, and users could dispense just one hot drop at a time. When he began marketing the sauce commercially, he ordered new "cologne" bottles because the size and shape made sense for his hot sauce. The bottle became so identified with the product that Tabasco trademarked the size/shape. You can see Tabasco on Facebook, where it has more than 3.2 million likes.

In recent years, new hot sauces have invaded grocery shelves, and competition continues to heat up. Huy Fong's chili-and-garlic sriracha sauce is a good example: It has become increasingly popular, especially among foodies, and also has a highly recognizable bottle profile and label, including the rooster.

Sriracha is such a "hot" food product that Tabasco now has its own version...as do other sauce marketers. Although Huy Fong's owner David Tran never trademarked the "sriracha" product name, he says the new-product activity in the sauce market increases awareness of sriracha and acts like free advertising for his, the original sauce of its kind. Check out Huy Fong on Facebook (240,000+ likes), where founder David Tran is the face of the brand. 

The Food Industry's "Dynamic, Disruptive, and Transformative Time"

Stephen Hughes, CEO of the natural foods firm Boulder Brands, tells Fortune the industry is going through "the most dynamic, disruptive, and transformational time" he's seen during 37 years in the food business.

Boulder owns brands like Smart Balance, Earth Balance, and Glutino. His brands are part of the disruption. Increasingly, consumers are reading food labels with great care and concluding that less is more--less processing, more nutritional value.

Brand trust is vital in this brave new world of fresher, healthier packaged foods. No wonder Heinz is fighting mad over Boulder Brands' plan to put its Smart Balance name on frozen foods. Heinz owns the Smart Ones brand of frozen foods and objects to what it sees as a close similarity of brands that might confuse consumers.

A few months ago, the CEO of Campbell Soup commented on "the mounting distrust of so-called Big Food, the large food companies and legacy brands on which millions of consumers have relied on for so long." Alas for Campbell Soup, sales of its core product are stagnant to slowly dropping. But happily, the company's acquisition of Bolthouse Farms fresh produce and Plum Organics is evidence of its growing experience with trusted natural foods brands.

Interestingly, mainstream supermarket chain Kroger owns what appears to be the largest natural-food brand in the country: Simple Truth, barely 2 years old and already ringing up more than $1.2 billion in annual sales. That's a lot of sales and a lot of brand trust--and a lot of disruption caused by a major retailer that distributes major packaged-foods products.

Does Reputation Count?

GREENWASHING

The Reputation Institute's 2015 study of global corporate reputations has been released. The top 10 corporations worldwide (determined on the basis of innovation, governance, citizenship, and other criteria) are:

1. BMW
2. Google
3. Daimler
4. Rolex
5. LEGO
6. Disney
7. Canon
8. Apple
9. Sony
10. Intel

The U.S. list has three familiar brands on top: Amazon, Kellogg's, and LEGO. Those are followed by Fruit of the Loom, Campbell Soup, Levi Strauss & Co., Snap-on, Hershey, Panera Bread, and Briggs & Stratton.

A Cone Communications/Ebiquity study of consumer attitudes toward corporate social responsibility indicates that 90% would change brands to support a worthy cause. Moreover, 80% would be willing to purchase an unknown brand associated with a strong social responsibility commitment.

Consumers are increasingly wary of greenwashing and willing to change behavior when they believe a company or brand isn't living up to its statements or commitments.

So does reputation count? Clearly, building and maintaining a reputation for authentic social responsibility can pay back in financial terms, not just goodwill.

Ziferblat's Pay-by-the-Minute Pricing

You've heard of paying by the pound or ounce for salads and frozen yogurt. How about paying for coffee and snacks by the minute?

Ivan Mitin, Ziferblat's founder, began the practice of charging for time spent in his cafe five years ago, after expanding from impromptu poetry and art gatherings in a small Moscow location. Soon he began receiving requests for other locations, and he began spreading the Ziferblat concept around the world.

The English-language site explains the concept this way:

"Ziferblat is the first place where everything is free. Except the time you spend there."

Ziferblat reportedly translates into "clockface" as a brand reminder of the concept. The brand now has a presence beyond Russia, including cafes in Ukraine, Slovenia, London, and Manchester (UK). Cakes, coffees, teas, and of course Wi-Fi are all free. You just pay for the time you actually spend in the cafe.

So far, this unique pricing policy has caught the attention of locals and vacationers alike. Does Ziferblat have a long-term future in a world where Starbucks and other competitors offer comfy seating for as long as customers wish to linger over a single mug of espresso?

Branding Power: Top Players in 2015

According to Tenet Partners, the top 10 most powerful brands in 2015 (based on awareness and positive perceptions) are:

1. Coca-Cola
2. Hershey
3. Bayer
4. Walt Disney
5. Apple
6. Johnson & Johnson
7. Microsoft
8. Pepsi-Cola
9. American Express
10. Harley-Davidson

Coca-Cola hasn't left the top slot in this study since 2008. Apple has (deservedly) demonstrated a meteoric rise in this study, shooting from #56 to #5 in just six years.

Although I'm a little surprised to see Bayer so high on this list, the methodology shows that the ranking has a lot to do with high awareness.

Clearly, both awareness and positive perceptions are vital for building brand equity. And every brand on this top-10 list has high brand equity. Year to year, however, their relative rankings may rise and fall, depending on issues such as quality lapses or recalls or other problems that hurdle brands into the headlines.

More About the Gray (or Grey) Market

GRAY MARKET MARKETING

My recent post about Pirate Joe, a gray market retailer, was so popular that I'm following up with another post about the gray (or grey) market.

The gray market is also called the market for parallel imports because products are procured outside the regular channels--not an illegal practice. Also not a new practice.

An electronics retailer like B & H in New York City may import a branded camera or video unit without going through the manufacturer's official channel(s), for instance. In fact, that's exactly what B & H does in some cases--and it notifies customers on its website about how and why it uses a channel it calls direct import, meaning not through the manufacturer. The reason: the product is cheaper to buy and therefore can be sold at retail at a lower price than the same branded product is being sold at other retail outlets.

However, manufacturers may legitimately refuse to service such products or provide technical support if the items were not purchased from authorized retail channels. Nikon is one of many manufacturers that say so on their websites.

This is an ongoing situation in some product categories, including electronics and luxury goods. As a result, Chanel recently reduced its prices in China to avoid losing sales to non-authorized merchants who were purchasing abroad and selling at prices well below Chanel's retail prices.

Interestingly, companies like Kodak see the gray market as an opportunity to help brands protect themselves. Kodak Security Systems will help firms monitor the flow of products and defend against competition from gray market activities.

Tune Up Your Marketing Plan for 2015

Is your marketing plan ready for 2015?

Lots of businesses and organizations are implementing the marketing plans they developed during 4Q/2014. Now it's time to be sure those plans take into account the emerging or ongoing trends that experts believe will have the most impact on digital marketing in 2015.

• Use social media for content marketing. Sure, this trend was a major factor in 2014--but it's going to be even more important in 2015, especially for B2B marketing. Takeaway: Reexamine your messages and media with an eye toward integrating the newest social media appropriate to your target market.
• Think mobile first. A growing number of consumers and B2B customers use tablet computers and smart phones primarily (or even exclusively). Knowing this, some firms develop messages for mobile first, then adapt them for other media. Takeaway: Review your branding and messaging strategies for this channel. Web pages look different on mobile screens, remember? And customers often welcome (or expect to receive) special mobile offers, so invite them to opt in.
• Make the most of marketing memes. Marketers are creatively leveraging memes to boost buzz about their brands and specific offerings. To do this, think visually and add a headline to attract attention, encourage curiosity, even inspire. Takeaway: You want your meme to be shared--if successful, it will give your brand a halo effect.
• Refresh and personalize. Sweep those cobwebs off your website or YouTube channel--customers and prospects like seeing new and different content (or layouts). They particularly like being able to personalize your site for their needs. If you look at the Wall Street Journal site several times a day, you'll see many of the same top stories but in different positions on the home page. The overall look of the page remains stable, but the day's stories and photos aren't in the same place for very long. Takeaway: For your marketing plan, this means regular updates and changes to your digital properties, both content and position of content on the page(s). Invite visitors to register so they can customize your site, and you'll capture contact info and more.

Hello Kitty's $7 Billion Brand

Happy 40th birthday, Hello Kitty. The iconic Japanese character, owned by Sanrio, has been making fans smile since 1974. Sanrio created her after consumer surveys revealed the perennial popularity of cats and dogs (and bears). The company already had a bear character and was licensing Snoopy, so it developed Hello Kitty and a star was born.

Hello Kitty is licensed for a wide variety of products worldwide. She's also the feature attraction in a new Hello Kitty theme park, soon to open in Zhejiang province, China. Hello Kitty has other theme parks in other places (including in her home country of Japan and in Malaysia), to entertain fans of all ages.

By one estimate, the Hello Kitty brand is worth a staggering $7 billion. Her appeal is so broad that Japan now uses her as its ambassador of tourism to China and Hong Kong. Judging by her enduring appeal and profitability, Hello Kitty will be smiling on goods and services worldwide for another four decades--and possibly longer.

Airline Safety Videos Reinforce Brand Personality

Airlines have distinct brand personalities, and more carriers are reinforcing those images with unique and entertaining on-board safety videos.

The latest is by Air New Zealand, the "Official Airline of Middle-Earth." Here's a link to what the airline calls "the most epic safety video ever." The airline posted it on Youtube yesterday and in 24 hours, the video has attracted 616,000 views. And no wonder: It stars some of the Hobbit stars, including Elijah Wood, and takes the viewer on a journey that crosses New Zealand and enters the realm of elves and other Middle-Earth inhabitants.


Other airlines are using safety videos to reflect and reinforce brand personality--and to put a smile on passengers' faces while providing serious safety information. Virgin America has attracted millions of views for its animated safety video, for instance. 

Considering the intense competition among today's airlines, making safety videos entertaining and brand-related is a good way to give passengers a positive experience while getting ready for takeoff.