Archive for October, 2009

Learning from Nina Yoder

October 30, 2009

You can learn something very important by doing a Google search on Nina Yoder.

I did the search this evening and got 1,090,000 hits.  Ms. Yoder has certainly made quite a splash in the internet world.

The problem, of course, is that almost all of this publicity is negative. 

Ms. Yoder is a nursing student at the University of Louisville.  Earlier this year she wrote some rather questionable posts on MySpace.  In one post she described a birth noting “…out came a wrinkly, bluish creature, all Picasso-like and weird, ugly as hell, covered in god knows what, screeching and waving its tentacles in the air.”   In another post she explained how she got in trouble in class for her opinion that alcoholism was a choice.  She has colorful views on many subjects. 

University officials, seeing Yoder’s posts, promptly tossed her out of the nursing program.  She sued and eventually won her case in federal court.

While Ms. Yoder is back in the program, her brand has taken quite a hit.  She is apparently a crass, disagreeable individual and a trouble maker to boot.  The 1,090,000 Google hits support the point.  These associations will endure for many years, perhaps all her life.

The lesson here is that one has to be very careful about posting on the internet.  A carelessly written post can quickly take on a life of its own and have a long-lasting impact on a brand.

My advice is simple.  If you are angry and feel the need to vent, you should write a letter or start a journal.  Just don’t post anything that could hurt your brand in the years to come.

Attack of the Droid

October 26, 2009

There are some brands that seem untouchable.  They are so revered it is difficult to say a bad thing about them.  This list includes Virgin, Nike, Barack Obama, Bono and, perhaps most of all, Apple.

How can you say something bad about Apple?  This is the company that brought us the iPod and the iPhone and the brilliant Apple-Microsoft ads.

So when someone shows up and starts throwing stones at Apple it is a noticeable event.  And that is precisely what Motorola is doing with the new teaser spot for Droid.

You can see the spot here:

Motorola directly attacks the iPhone; the spot highlights all the limitations of the iPhone and concludes “Everything iDon’t, Droid does.”

In tonality, Droid is the opposite of the iPhone.  iPhone is happy and friendly and sociable.  Droid is dark and a little scary.

If Apple is Nike, then Droid is Under Armour.

This is a smart strategy for Motorola.  Attacking Apple is a difficult proposition.  Pushing the edge only makes sense; Motorola needs to differentiate on a product basis and in attitude.

It is not certain this all will work.  The product has to deliver and Motorola has to spend enough to break through.  The marketing pitch will need to evolve into a campaign with a single, motivating benefit; now it is just a somewhat confusing teaser spot.

The results are not in but Motorola seems to be on the right track.

GM: Still Struggling with Marketing

October 23, 2009

If there is one company in the world that needs some compelling marketing it is General Motors.

GM emerged from bankruptcy on July 10 and is now largely owned by its unions and the U.S. federal government.  The company was able to cut costs through the bankruptcy process, but ultimately it will need to hold and build its market share to survive.  After disposing of most of its brands, GM now needs its four remaining brands to perform.

Unfortunately, the GM’s latest advertising isn’t doing much to help the cause.

Today in the Financial Times, for example, GM is running a full-page ad for Cadillac.  The ad features (surprise!) a picture of a car.  Here is the text:

 

Sorry about the Apple Cart

2010 Cadillac CTS Sport Wagon

With bold design and unrivaled technology, it overturns every convention.  And with an unprecedented Sixty-Day Satisfaction Guarantee it stands poised to show you how.  Steer clear of the luxury default button.  For complete details and limitations, visit Cadillac.com/guarantee

May the Best Car Win

 

This ad says just about nothing.  Why should someone buy the CTS?  What does Cadillac stand for, anyway?  What is the brand’s positioning?  It isn’t clear.

More fundamentally, the tag line “May the Best Car Win” suggests that the marketing folks at GM really don’t understand the challenge facing the company. 

The important question is not which car is best.  The important question is which car do people think is best.  I’m quite confident that GM makes good cars.  It may well be that GM now makes the best cars.  But that really doesn’t matter.  The problem is that the best car doesn’t win.  People buy the cars they think are best.  All too often those are not GM cars.  Changing this is GM’s core challenge.

“May the Best Car Win” is more wishful thinking from Detroit.

Bud Light Golden Wheat

October 20, 2009

Saturday Night Live’s October 17 broadcast was a notable event.  For the first time in the show’s 35 seasons, a single advertiser, Bud Light, bought all the national advertising time. 

Bud Light used the sponsorship to launch new Bud Light Golden Wheat, the latest addition to the Bud Light family.  Golden Wheat follows the 2008 introduction of Bud Light Lime and gives the Bud Light family three main products: Regular, Lime and Golden Wheat.

The new product is a clearly designed to drive growth.  Beers sales are flat, so Bud Light needs something to steal share from competitors and increase volume. 

In terms of execution, the Saturday Night Live program was a winner.  By sponsoring the show, Anheuser Busch drove huge awareness for the new product.  The brand also likely generated an enormous amount of talk value.  This is a wonderful illustration of how a brand can break through and stand out in a cluttered world. 

Strategically the new product launch is far more questionable.  A new flavor will certainly lead to trial; people will probably pick up a six pack to see what it tastes like.  It will also give distributors something to sell.  

It seems unlikely, however, that the move will really generate substantial incremental volume.  The people most likely to try the product are presumably people who already like Bud Light, since the new product is clearly branded Bud Light.  I suspect the new product will heavily cannibalize regular Bud Light and Bud Light Lime. 

The new product will create a lot of complexity for the Bud Light business.  Managing inventory will be a greater challenge.  It will be harder to optimize shelving.  It will be difficult to allocate marketing efforts across the Bud Light portfolio.  Worst case, the Bud Light brand could find itself becoming more and more reliant on new products to drive sales.  There will be pressure to have something new each year.  Over time the incremental volume of each new product will likely decline and the complexity of managing the inventory will increase.  This is a dangerous road.

In the long run a brand like Bud Light needs the core product to do well.  Line extensions can provide a short term sales jump but are not a sustainable growth strategy.

Pure Michigan

October 16, 2009

Now here is a real marketing challenge: sell Michigan as a vacation destination.  Yes, Michigan, the land of failing auto companies, the bumbling Lions and desolate Detroit.  It isn’t the sort of place that stirs the soul.  I suspect both Hammond and Newark both fall higher up the list of places to visit for most people.

All this helps explain why Michigan’s advertising campaign is so remarkable. The Pure Michigan advertising makes the state seem like an incredibly special place to visit, well worth a trip.  Here is the text of the latest spot:

As life starts moving faster and faster we need to make a choice: to move faster with it, or to step off every now and then.

To marvel at the wonders around us, to take in new sights and sounds and remember just how beautiful life can be.

This fall let’s take in a deep breath of pure Michigan.

Set to a bit of epic music and beautiful scenery, the result is impressive indeed.  You can watch it by clicking on this link:

The latest spot touches some very high order benefits: the need to slow down, the need to relax.  The pitch is credible and motivating.

It is enough to make me forget about Detroit’s woes and head off for a bit of Pure Michigan.

Healthcare Reform: Where are the Benefits?

October 12, 2009

There is broad agreement in the United States that healthcare reform is good concept.  Indeed, it is very hard to oppose it.  It is also hard to oppose the environment, human rights and world peace.

But there is very little agreement about the plans being considered.  From a marketing perspective, I think there are two obvious problems with how the debate is unfolding.

The first problem is complexity.  The bills being considered are complicated and detailed.  There are many different elements and angles.  Some of the bills are over 1,000 pages long.

The proposals are so complicated it is almost impossible to actually know what is being proposed.  What is the main point, anyway?

The second problem is a lack of benefits.  One of the most basic marketing principles is that people are motivated by benefits.  But it is very hard to find the benefits in some of the healthcare proposals.  For most people the most important question is simple: what is in it for me?  At the moment it is very unclear.

The lack of benefits is rather startling.  For people with health insurance, it isn’t clear how the new plan will help.  There isn’t a compelling benefit.  For many people without health insurance, the prospect of being forced to buy it isn’t attractive.  There isn’t a compelling benefit for them, either.

Most people would agree that there are real downsides in the proposals:  huge amounts of new government spending, higher taxes, more government bureaucracy, uncertainty, change and risk.

At the moment the downsides far outweigh the benefits for many people.  It is tough to sell anything when this is the case.

The people leading the healthcare reform movement should simplify things and identify some benefits that people care about and believe.  If they don’t, they will find themselves attempting to sell a proposal that many people don’t want, and that isn’t winning approach.

Cash for Clunkers: No Way to Build a Strong Business

October 7, 2009

Anyone who has run a business knows two things about short term discounts.  First, big discounts feel great.  Nothing buoys the spirits like a quick and dramatic jump in sales. Second, this happy feeling rarely lasts.  Once the discount ends sales inevitably slump, often for a prolonged period of time.  The only way to get things moving quickly is to do another round of discounting.

The Cash for Clunkers program was a classic bit of short term discounting.  People who bought a new car received up to $4,500 from the government.   While it ran this program felt great; people rushed to dealers and bought cars.  They did exactly what one would expect them to do.  The program had a rather impressive impact on the entire U.S. economy, contributing to the rebounding economic indicators and a rising stock market.  Everything looked great.

But ultimately Cash for Clunkers had to end; it was a costly and unsustainable program.  And now sales are falling.  The monthly auto sales results released last weeek were shockingly bad.  General Motors sales were down 45% versus year ago.  Chrysler sales were off by 42%.  These are simply stunning declines.

Cash for Clunkers didn’t fix the economy and it didn’t fix General Motors or Chrysler.  Sales at GM and Chrysler will only rebound when people feel confident enough to invest in new cars and believe that the GM and Chrysler brands are the best ones for them.  Last week’s sales results show that we are a long way from that point.

The Starbucks Via Challenge

October 5, 2009

Let me start with a confession: I failed the Via challenge.

This morning I stopped by my local Starbucks.  I tried Via and then I tried the brewed coffee.  And I couldn’t tell the difference.  I was completely stumped.

I find this rather astonishing.  I am quite a coffee fan and I drink a lot of it.  I also had tried Via earlier this year and thought it was good but not quite up to snuff. 

So I am now convinced that Via is a good product.  Congratulations to Starbucks on this.

The question remains, however:  should Starbucks be investing in an instant coffee?

There are compelling reasons for Starbucks to be supporting Via.  Perhaps most importantly, Via opens up a new usage occasion for Starbucks.  When people can’t make it to a Starbucks location they can still enjoy a Starbucks coffee.  And Starbucks can get some additional revenue.  Indeed, while I was buying my brewed coffee and scone this morning I chatted with someone who was buying Via, and he explained that Via was perfect for days when he was running late and didn’t have time to stop in.

That said, I’m not convinced that the Via launch is a good move.  Starbucks has long worked to embrace the coffee experience, the crisp beans coming from exotic lands all over the world, the grinding noise, the wonderful aroma, the ritual of precisely measuring coffee and water and then waiting for it to brew.  Starbucks has taught us that coffee isn’t just coffee.  There is much, much more to it.

Via runs counter to all of that.  You don’t need to grind beans, you don’t need a special machine, you don’t need precise measurements.  You don’t need all those things you thought you needed.  Just open the pouch and pour it in.

There is no romance in Via.

To me this feels like a company going for short term growth and diluting its brand in the process.  Of course, this isn’t the first time that Starbucks has focused on growth at the expense of its brand; it is just the latest in a series of moves that has weakened what was once an incredibly powerful franchise.

Chicago’s Olympic Marketing Miss

October 2, 2009

There will be a lot of second guessing here in Chicago now that the city’s Olympic bid has failed.  People will probably point to a weak final presentation, an over-reliance on celebrities and the geographic composition of the IOC.  These are all fair points.

One issue that certainly played a role was the lack of support for the bid in Chicago.  Recent polls indicated that almost 50% of people living in Chicago were against the bid.  This is a major issue; it is hard to invest in a major public venture when people don’t support it.

The Chicago bid team clearly failed to effectively market the Olympics in Chicago.  Why would Chicago want to host the games?  How would it benefit the people in city? 

My observation is that the team might have focused a bit too much on the good and greats of the world and not enough on the people in Chicago.

There are many of reasons why a city would want to host the Olympics; the economic benefits are considerable and it is a wonderful civic event, a source of pride and great fun.

That message never reached many people in Chicago.  They heard about the costs and were skeptical of the promises made by the politicians, but they never really understood the benefits.

This is unfortunate and a missed opportunity.

Sad News from Saturn

October 1, 2009

This afternoon the Penske Automotive Group announced that its bid to acquire the Saturn brand had fallen through.  As a result, General Motors will be discontinuing the brand.

This is sad news.  At one time Saturn was a wonderful brand.  General Motors created Saturn in 1990 in a bold effort to compete with the imports.  Saturn was a breath of fresh air in the auto industry.  The dealers provided excellent service and there was no unpleasant haggling.  The cars were small, practical and affordable.  The labor force was a partnership between management and labor.  The marketing message was emotional, not technical.

And for a while it all worked.  Sales soared and, perhaps more importantly, Saturn became a unique brand.  People felt a connection to Saturn; it wasn’t just another General Motors car brand, it was special and unique.  Saturn owners went to reunion events at the factory.  They were part of a family, part of the brand.

As the years went by, however, General Motors neglected the brand.  Saturn, starved for investment, gradually eroded.  As GM’s financial troubles mounted it became very clear that Saturn had no future with the company; GM had to focus on a few big brands. 

For a while it appeared that Saturn would survive; earlier this year the Penske Automotive Group offered to buy Saturn.  Penske would outsource manufacturing and just focus on marketing and sales.  This was a bold move and a hopeful one for Saturn.

But today Penske announced that it couldn’t secure manufacturing capacity and couldn’t complete the purchase.

This is a sad day for anyone who appreciates brands.  One of the special ones is going away.


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