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Archive for the 'retail' Category

Mar

Are running shoes a sham?

By Kirk 2 Comments

Categories: health care, public relations and retail

istock_000008706988xsmall If you spend in the neighborhood of $100 per pair of running shoes like I do, you may find the following statement by Dr. Daniel Lieberman, a professor of biological anthropology at Harvard University, disconcerting:

“A lot of foot and knee injuries that are currently plaguing us are actually caused by people running with shoes that actually make our feet weak, cause us to over-pronate, give us knee problems,” says Lieberman in Born To Run: A Hidden Tribe, Superathletes, and the Greatest Race the World Has Never Seen, a book by Christopher McDougall.

“Until 1972, when the modern athletic shoe was invented by Nike, people ran in very thin-soled shoes, had strong feet, and had much lower incidence of knee injuries.”

Lieberman’s study and McDougall’s book are fueling a debate within running circles (and shoe companies). Are running shoes not only not helping us, but actually hurting us? Is running barefoot safer?

“We were born to run, but maybe not with shoes on,” says The Boston Globe. “New research … shows that people who run barefoot or with minimal shoes — as people have done for millions of years — often land on their feet in a way that avoids a jarring impact. That’s very different from most shoe-clad runners, who crash down on their heels with every bound.”

Or as Popular Mechanics asks, “Could shoes — and shoe companies — be part of a $25 billion snake oil industry, covering hundreds of thousands of perfectly able bare feet?”

Lieberman explains on his study’s web site that “runners who forefoot or midfoot strike do not need shoes with elevated cushioned heels to cope with these sudden, high transient forces that occur when you land on the ground.”

McDougall isn’t quite so gentle. One full chapter of his book is an indictment of Nike and other running shoe manufacturers that he believes know their shoes are causing injury and continue to sell them anyway.

At least one shoe company, New Balance, addresses the issue head on: “After hundreds of years of walking with shoes on, is it time we relearn? There’s a movement going on that challenges the very foundation of sneaker wearers (not to mention sneaker companies) everywhere, around running barefoot. This broad grouping of perspectives includes some runners who are finding they prefer to run exclusively barefoot, some who prefer to run with minimally cushioned shoes, and others who like to vary their runs between shod, minimally shod, and shoeless.”

Nike, the inventor of the modern high-tech, highly engineered running shoe, doesn’t miss a trick. Or a marketing niche. It has introduced a new shoe, Nike Free, that for all the world looks like the flat-soled Keds, PF Flyers, and Chuck Taylor All Stars I wore as a kid. The Nike Free slogan? “Run Supernatural.” Back to the future, I guess.

In his book, McDougall builds the case that humans are built — not to run fast — but to run long. He tracks down and studies the mythical Tarahumara Indians who run for extreme distances in lightweight sandals in the remote and deadly Copper Canyons of Mexico.

And he’s a convert. Since running in Vibram FiveFingers, a neoprene sock-like foot covering, he’s seen his running injuries disappear.

Though I’m not quite ready to hit the pavement barefoot, especially in the winter, the idea of lacing up the old Chucks from high school is kind of appealing. As I remember, I was faster back then.

How about you?

Feb

Olympic scorecard: how to judge ambush marketing

By Kirk 1 Comment

Categories: advertising, event marketing, mass media, promotion, retail and strategy

For the organizers of the Winter Olympics, the pressure is on. They are fighting to defend their sponsors against ambush marketing at the Games.

(Ambush marketers attempt to attach their brand to a major event without paying for the right to do so.)

As the Vancouver Organizing Committee (VANOC) states at the Games’ official web site, “Ambush marketing is a real threat to VANOC’s sponsorship and licensing programs as it undermines the value of official sponsorship and licensing rights and impairs VANOC’s ability to attract future sponsorship and licensees.”

Only official sponsors, licensees and government partners are allowed to suggest a connection with the Olympics.

This is because nearly all of the revenue needed to support the 2010 Winter Games is derived from sales that involve the Olympic brand, such as sponsorships, broadcast rights, merchandising and tickets.

Why would a potential sponsor shell out millions of dollars only to have their moment in the sun eclipsed by a non-sponsor?

It’s happening right now. Official Olympic sponsors McDonald’s and AT&T are charging rivals Subway and Verizon with ambush marketing. (See the previous post, “Ambush marketing: dirty play at the Olympics?“)

Why is it VANOC’s job to be the police?

According to them, “One of the key conditions of being awarded the right to host the 2010 Winter Games was a commitment to the International Olympic Committee (IOC) that the Olympic Brand would be protected in Canada.”

VANOC’s goal is to ensure that consumers aren’t fooled into believing an advertiser is associated with the Olympics when it is not.

To determine whether a promotion infringes on Olympic trademarks and images, VANOC developed a scoring system. (See the accompanying illustration of how a retail promotion might be assessed.) It measures against six criteria: accuracy, relevance, commercial neutrality, prominence, use of official visuals, and unauthorized association.

The fairness of scoring systems at the Olympics has occasionally been suspect. (Remember the 2002 figure skating scandal?) How do you think this system for scoring marketing stacks up?

Feb

P&G brands … itself?

By Kirk 1 Comment

Categories: advertising, event marketing, interactive marketing, promotion, retail and strategy

Procter & Gamble, the inventor and best known practitioner of brand management, is finally getting around to branding itself.

In its first-ever corporate campaign, 17 of P&G’s brands are featured under its singular umbrella. In partnership with the U.S. Olympic Committee, P&G is running two new TV spots and an accompanying multi-channel campaign during the Winter Games.

Well known as the largest advertiser in the world, P&G has previously executed its marketing brand by brand. It is often cited as the premier example of a “house of brands.” Until now, with the exception of tags at the end of TV spots in China and Japan, P&G has never marketed itself as a brand.

“ … we do not intentionally promote our company name unless it’s to build rapport for a new product, ” says Daisuke Hase, P&G External Relations Supervisor, at J@pan Inc. ” … we don’t tag our name on a product unless necessary.”

Things have changed.

The reason? At Marketing Daily, Kirk Perry, P&G Vice President, North America, says the Winter Games are the right time and place for the company to take a unified corporate approach.

“We know the Winter Olympics are the number one sport among women 18 to 34 and the second-most watched among men after the NFL,” says Perry. “And, given the economy, people are taking vacations closer to home. The Olympics are a terrific family event. And this will be a terrific return relative to other options.”

In Brandweek, P&G CMO Marc Pritchard says, “P&G may not be in the sporting goods business, but we are in the business of helping moms. We strive to help improve her life and the life of her family, in small, meaningful ways. The common denominator between P&G and the Olympic Games is the connection with moms.”

As part of the campaign, P&G is running a Tribute to Moms video on its web site. Its Thank You, Mom campaign site is complete with mom blogs, videos, photos, and a Twitter feed from the Games, plus (of course) product information and coupons.

Consistent with the mom theme, the company is helping defray the cost of travel to Vancouver for mothers of competing athletes. The athletes will also participate in the campaign, which includes advertising, PR, in-store merchandising, mobile, digital and direct mail.

Perry says, “It’s our most-integrated marketing plan behind a single event ever.”

What do you think of this change in strategy from the originator of brand management?

Jan

The rise of community bank brands

By Kirk 2 Comments

Categories: advertising, loyalty, public relations, retail and strategy

The customers of George Bailey’s “wonderful old building and loan” rallied to defend it from the money-grubbing Mr. Potter in It’s A Wonderful Life.

Although the circumstances are different, small banks across the country are attempting to arouse the same kind of passionate community support. Hoping to attract consumers angry and disgusted with big banks due to the Federal bailout, the huge bonuses, and the arrogance in general, community banks are urging big-bank customers to switch accounts to them.

The New York Times reports a number of local uprisings:

a credit union in Texas running a campaign, “Real Texans bank locally.”
a single-engine plane, hired by a small Colorado bank, towing a banner over a Rockies’ game, reading “This is the closest thing we have to a private jet.”
a credit union in Washington running an ad that asks, “Why should your bank’s CEO get a golden parachute while the rest of the bank nosedives?”
a consortium of banks in Ohio advertising together as The Community Bank Connection, where “Every banker knows your name.”

Hundreds of community banks and credit unions from around the country have combined their marketing budgets for a campaign created by BancVue, a marketing consulting firm. It promotes a variety of products and services under one cryptic brand name, “Kasasa.” The joint effort is aimed at attracting deposits from large institutions.

Arriana Huffington of The Huffington Post and some friends set up Move Your Money, a grassroots campaign encouraging customers to switch their accounts. (They produced the attached mashup of It’s A Wonderful Life.)

Is it working? Yes, according to The New York Times. “So far, the campaigns appear to be helping banks attract new customers. According to an analysis by the Independent Community Bankers of America, small banks were the only segment of the industry to show growth in net loans and leases in the second quarter.”

Likewise, Bancvue reports significant success from its pilot campaign in ABA Banking Journal.

Once, the big-bank brands of Wall Street seemed the trustworthy haven for one’s savings. Now, for many, small banks look like the safer choice.

Do you believe a fundamental shift in where people bank is occurring?

Will the big banks eventually earn back the public’s faith?

Will the small banks sustain any advantage?

And most importantly, will you move your money?

Jan

Warning: Your brand is being commoditized!

By Kirk 1 Comment

Categories: brand essence, loyalty, retail and strategy

Remember the old days when coffee was a commodity? We may be headed there again.

Starbucks, with its expansion in 1987, revolutionized how we drink and think about coffee. It convinced us to buy whole beans instead of grounds. It familiarized us with espresso, cappuccino and latte. It introduced us to an American version of the European café experience.

Following Starbucks’ success, imitators, such as Caribou, The Coffee Beanery, and others, proliferated. McDonald’s, feeling the heat, changed its bean, ran a “Four bucks is dumb” campaign, and added its McCafé lineup. Tim Hortons and Dunkin’ Donuts followed suit. Now, Speedway is on the attack with less expensive, make-it-your-way coffee beverages.

Although these are very diverse retail models targeting different audience segments, they are clearly all responding to and offsetting the influence of the Starbucks’ brand experience.

It happens in every category.

No matter how hard a successful brand works to be different, it’s competitors are working just as hard to cash in by replicating it. Commoditization is a never-ending reality. It makes products and services indistinguishable and interchangeable. It levels the playing field after a brand has built a lead.

And yet there are some iconic brands that, despite competitive copycatting, manage to sustain their long-term “ownership” of a differentiator in the minds of consumers. Brands such as ESPN, Mountain Dew, Google, Volkswagen, Quaker Oats, Nike, Harley-Davidson, and Apple. How do they do it?

As discussed in a recent post, tangible advantages can quickly and easily be duplicated. Beyond the tangibles, strong brands have succeeded at bonding with their customers around an intangible attribute.

Starbucks’ defense against commoditization may not be the quality of it’s coffee, but rather the warm, comfortable, friendly intimacy it has created around the coffee-drinking experience. Is this an advantage they can sustain?

Jan

Imagine if every brand was as honest as Domino’s

By Kirk 3 Comments

Categories: advertising, loyalty, public relations, retail and strategy

In its new campaign, Domino’s ‘fesses up to having served “crust like cardboard” and “sauce like ketchup” for years. Then it asks pizza lovers to forgive, forget, and try its new recipe.

“By doing that they are basically saying, ‘We’ve been shoveling you crap for years and now we want you to trust us,’” says Kelly O’Keefe, managing director of the Brand Center at Virginia Commonwealth University, in an Associated Press story.

Or like your partner saying, “I cheated on you, but now I’d like to try to make it work.”

Could other brands benefit from this confessional approach? These, for example?

GM: “When we heard that what you really want are well-designed, fuel-efficient cars that are affordable and fun to drive … well, frankly, it was hard to face. But now, after working night and day, we’ve changed everything. We think you’re going to be surprised.”

American Airlines: “We’ve made you wait in long lines, pay for your luggage, sit on the tarmac for hours, and miss your connecting flights. But learning how you felt about it hit us right in the heart. Now, we’ve completely reinvented ourselves. It’s what being great is all about.”

Budweiser: “As you have switched your taste preference to microbrews and imports, we have had to accept the criticism that our beer is watery and flavorless. Even after brewing it that way for generations, there comes a time when you have to step up, face reality, and make a change. That’s what we did. We can’t wait for your reaction to our new flavorful beer.”

NFL: “You told us our athletes play like they don’t care. Let’s face it — they’re spoiled. We pay them too much money and they spend it all on drugs, sex, and toys. That’s why we’ve decided to go back to the basics and air high school games instead. Unpaid players playing solely for the love of the sport – you won’t believe the difference! It’ll put excitement back into the game. Check it out this Friday night!”

Which other brands should ask you for a second chance?

Dec

The North Face Dilemma: Spank the Butt or turn the other cheek?

By Kirk 3 Comments

Categories: identity, loyalty, promotion, public relations, retail and social media

Okay, it’s a little bit funny.

At least the first time you see this parody of The North Face’s familiar logo.

But The North Face is not laughing. It is, instead, suing young Jimmy Winkelmann, founder of The South Butt brand, for trademark infringement, trademark dilution, and unfair competition.

Winkelmann isn’t subtle about the inspiration for his line of casual apparel. The South Butt’s tagline is “Never Stop Relaxing,” a play on The North Face’s “Never Stop Exploring.”

On his web site, Winkelmann says, “I thought of The South Butt in response to a growing number of people who continued buying gear and clothes from a brand they really didn’t relate to, but were buying because ‘everyone else was.’

“After seeing the same people wearing the same brands, I decided to create a way to poke fun at the norm, while making an affordable and quality product.”

Despite his disclaimer (”If you are unable to discern the difference between a face and a butt, we encourage you to buy North Face products.”), he’s not just having fun. He’s selling merchandise — much more now due to the media attention provided by the lawsuit.

An article by Jim Salter of the Associated Press quotes the suit: “They (The South Butt) are marketing apparel that directly and unabashedly infringes and dilutes The North Face’s famous trademarks and duplicates The North Face’s trade dress in its iconic Denali jacket.”

“While defendants may try to legitimize their piracy under the banner of parody, their own conduct belies that claim,” the suit said. Supposedly, The South Butt has twice attempted to register its trademark and once offered to sell The South Butt to the The North Face for $1 million.

Winkelmann is capitalizing on the attention. He’s launched a game on his Facebook page, entitled “Can you tell tell the difference between a face and a butt? Take The South Butt Challenge.” He’s making media appearances. He’s leveraging a brand built by someone else. He’s making money.

“This is bigger than facing down a bully in the school yard,” said Albert Watkins, attorney for The South Butt and Winkelmann. “This goes to the heart of competition, the concept of an open marketplace, and the freedom of the public to make their own choice.”

So which is it? A parody, free enterprise, or a rip-off?

Are The North Face customers confused? Not likely.

Are they switching brands? No.

Is The South Butt a long-term threat to The North Face’s market share? No.

For The North Face, this is not about money.

It’s about demonstrating, for legal reasons, that they are willing to defend their brand. One of the ways a brand keeps its trademarks defensible is by proving it will not tolerate copycats. Putting Winkelmann out of business would send a message and serve to scare off other potential interlopers.

But there’s a risk. Legal action and continued media interest may make The North Face look humorless, corporate and stodgy. A heavy-handed handling of this frat-boy joke and the accompanying bad PR may not appeal to its younger customers. (Currently, The North Face does not respond to questions about the lawsuit and does not reference the issue in its social media. So much for transparency.)

How do you think The North Face should handle this?

Drop the lawsuit and be a good sport?

Or scuttle the Butt?

Dec

Indies vs. chains, and how to win

By Kirk 1 Comment

Categories: loyalty, retail and strategy

istock_000001734570xsmall The eternal struggle: little vs. big.

The independent hardware store vs. Home Depot.

The locally owned grocer vs. Kroger.

Everybody vs. Walmart.

The differentiators?

Sam Walton said, “The secret of successful retailing is to give your customers what they want. And really, if you think about it from your point of view as a customer, you want everything: a wide assortment of good-quality merchandise; the lowest possible prices; guaranteed satisfaction with what you buy; friendly, knowledgeable service; convenient hours; free parking; a pleasant shopping experience.”

Can independents compete with the chains? On most of these attributes, the answer is yes.

Price: Most consumers perceive that the big guys leverage their power to buy at lower prices and pass the savings on to the consumers. Walmart’s “Every Day Low Prices” position is built on this. Chalk this one up for the chains.

Service: No matter how hard the big boxes try to convince us otherwise, most consumers believe they get better service from smaller businesses. Local owners tend to live in the community and work in their stores everyday, whereas big boxes are owned out of town and tend to have higher staff turnover.

To maintain the edge, independents must focus constantly on delivering better service. There is great opportunity for differentiation here. Score this one for the little guys.

Selection: This attribute is in the eye of the beholder. Let’s say I want a pair of running shoes. Walmart offers Starter and Dr. Scholl’s. Huh? My locally owned running store features Adidas, Asics, Brooks, Ecco Biom, Mizuno, New Balance, Nike, Saucony, Under Armour, and more. No comparison.

Of course, chains tend to offer a broader selection of product categories. But if selection within a particular category is important, an independent may be the better choice. Let’s call this one a tie.

Quality: The same goes for quality. Chains tend to offer the more popular brands, which are often less expensive. If higher quality in a particular category is important to you, you will likely have better luck at an independent that specializes in the category, whether it be high-end cookware, apparel, home theater systems, or collectible comic books.

Here’s an example: Mad River Outfitters is one of the top fly-fishing shops in the country, offering quality brands such as Orvis, Sage, R.L. Winston, Scott, and Temple Fork Outfitters.

Of course, the brand categories that warrant better quality are a matter of personal taste. A brand to one is a commodity to another. (For more on this, see You say tomato. I say Fox’s Fine Gourmet Ketchup.) Accordingly, we’ll call this one a tie.

Convenience: This one also depends upon your your needs. If convenience to you means having lots of product categories under one roof for one-stop shopping, then the chains are the choice.

But shopping at chains can be an inconvenience if you need only a few items. The lines may be long and the parking lots crowded. Mom-and-pops may serve you faster. Let’s call this one a tie as well.

Final score: a tie.

The Davids will have difficulty beating the Goliaths on price. But in every other category the indies are competitive. To win, they should:

Avoid trying to compete in every product category. Instead, indies should carry more selection in fewer categories.
Accept that they can’t compete at the low end and carry higher quality merchandise than the chains.
Feature well regarded brands that the chains don’t carry.
Emphasize convenience throughout the shopping experience. Some independents offer free delivery, for example.
Service, service, service. This one above all others.

Which other ways can independently owned retailers compete favorably with the chains?

The message

Nov

Patagonia: They also sell clothes

By Kirk 2 Comments

Categories: brand essence, budgeting, cause marketing, loyalty, mass media, promotion, retail and social media

There are brands and then there are affinity brands.

The difference? Community.

You don’t just experience an affinity brand. Your identity is enmeshed with it. You are a proud member of the club.

“Cult Brands aren’t just companies with products or services to sell,” says BJ Bueno, co-author of The Power of Cult Branding: How 9 Magnetic Brands Turned Customers into Loyal Followers. “To many of their followers, they are a living, breathing surrogate family filled with like-minded individuals.”

Few brands exemplify affinity branding as well as Patagonia.

Patagonia makes outdoor apparel for climbing, surfing, skiing, and other low-impact sports. Its clothes are renown for their durability and performance.

But at Patagonia, it’s not about the clothes — which is characteristic of affinity brands. Selling apparel at Patagonia is practically an afterthought. Or so it seems.

Instead, affinity brands build a community of diehard evangelists around a common cause or set of values.

Patagonia’s cause began with its founder, Yvon Chouinard.

Chouinard, a rock climber and surfer, got his start making tools for climbers. Around 1970, he became aware that steel pitons were causing significant damage to rock-climbing surfaces. Inspired, he developed new alternatives and introduced a style of climbing called “clean climbing.” The result: his innovations revolutionized climbing, despite destroying the sales of pitons which accounted for 70% of his income.

Planet first. Company second.

“What is it that we all so love about the experience of being in raw nature?” Chouinard asks. “And having known raw nature, don’t we have an obligation to protect it?”

At Patagonia, protecting it is the priority.

In 1986, Chouinard committed the company to environmental activism and paid employees to work on local community projects. In 1994, Patagonia switched to using pesticide-free (organically-grown) cotton as well as recycled polyester in its clothing. Always planet first.

Today, the scale of Patagonia’s commitment is impressive. The environmentalism page of its web site lists its numerous initiatives, including Conservacion Patagonica, working toward the creation of Patagonia National Park; The Conservation Alliance, encouraging companies in the outdoor industry to support environmental organizations; 1% For The Planet encouraging all businesses to donate at least 1% of their annual net revenues to the environment, and more.

Through its Common Threads Recycling Program, Patagonia uses a fiber-to-fiber system to make new garments from old.

“For us at Patagonia, a love of wild and beautiful places demands participation in the fight to save them.”

How do brands create affinity?

“Brand communities exhibit three traditional markers of community,” according to Thomas O’Guinn and Albert Muniz in “Brand Community,” a 2001 article published in the Journal of Consumer Research. “Shared consciousness, rituals and traditions, and a sense of moral responsibility.”

All are present within the Patagonia community.

Company “ambassadors” share knowledge and experiences from the field on its blog The Cleanest Line, its own video channel The Tin Shed, and its YouTube channel. Outdoor enthusiasts and preservationists connect on Facebook and Twitter.

True, there’s a big difference between summiting Everest and wearing a Patagonia hoody to the park. But an affinity brand allows one to participate in the common cause. As Patagonia says, “Reward comes in the form of hard-won grace and moments of connection between us and nature.”

Which other brands inspire community?

Nov

Schmoozing the brand samplers

By Kirk 0 Comments

Categories: loyalty, research, retail and strategy

tp_h_wholecare_ppmt_5oz Next time you are practicing your oral hygiene, think about this:

Why can’t Colgate and Crest, the two top-selling toothpaste brands, achieve the customer loyalty of Tom’s of Maine?

And more importantly, if loyalty is the ultimate purpose for branding (as consultants say), why doesn’t Tom’s of Maine dominate the toothpaste category?

Are you familiar with Tom’s? In 1970, Tom and Kate Chappell decided to make and sell their own natural products in rural Kennebunk. They started with a $5,000 loan and the philosophy that their products would not harm the environment. Among other offerings, they launched the first natural toothpaste in 1975.

Tom’s of Maine sells 12 varieties of toothpaste. Crest sells 41. Colgate sells 31, not counting its Ultrabrite brand.

Tom’s outperforms its much larger competitors in the toothpaste category, according to Brand Keys‘ 2009 Loyalty Engagement Index, a list of rankings of customer loyalty. In other words, Tom’s of Maine customers are more loyal to Tom’s than Crest customers are loyal to Crest.

So why doesn’t Tom’s own a larger share of smile?

Because, although Tom’s of Maine has more loyalists, Crest and Colgate have more samplers.

You know — flip-floppers. The undecided, uncommitted, experimenting, switch-hitting, test-driving swing-voters. The people that decide our elections.

Every brand has them (or doesn’t have them), along with loyalists who always prefer the brand and rejectors who always prefer the competitors.

Why don’t the brand samplers commit?

Some simply don’t care. Perhaps they think the category is a commodity. They buy the cheapest or the nearest. Eat Kellogg’s Frosted Flakes one week, then mix it up with some Post Grape-Nuts the next. It doesn’t mean one isn’t at least a little favorable toward Frosted Flakes. Just not every frickin’ morning.

Other samplers may enjoy sampling. I know guys who can rattle off with pride the pros and cons of every make and model of sports car they have ever owned. They fancy themselves as connoisseurs who appreciate variety.

There is great value in brand loyalty. As has been famously pointed out by Kuczmarski & Associates, loyal customers, on average, are willing to pay a 20% premium for their brand of choice. And it’s common knowledge that retaining customers is less expensive than acquiring new ones.

In 2006, Tom’s of Maine was purchased by Colgate-Palmolive. (There goes that idyllic illusion of the family making their own toothpaste in the Maine backwoods.) Certainly brand loyalty to Tom’s had an impact on the price.

Achieving loyalty is the ultimate purpose of branding, but the strategies vary by audience segment, depending upon where they are on the loyalty scale. Branding should focus on: