Posts filed under ‘equity’

Listen up, retailers: brands DO matter.

The resurgence of Trademarks and brand names as drivers (rather than set price points): another sign recession receding.

From The Street.com

Retailers Get Push-Back as Brands Disappear

by Jason Notte
Saturday, March 20, 2010
provided byTheStreet.com

As evidenced by Wal-Mart’s (WMT) attempt to streamline its shelf space, even garbage inspires brand loyalty among American consumers.

Earlier this month, Wal-Mart returned Clorox’s (CLX) Glad bags and Pactiv’s (PTV) Hefty bags to its shelves after cutting them in February and carrying only S.C. Johnson and Sons’ Ziploc bags and its Great Value in-house brand. Wal-Mart says the Hefty and Glad bags and hundreds of other items were taken out of the mix as part of a remodeling effort, but the retailer replaced them when it became clear it wasn’t losing only a $4.99 single-item sale, but entire shopping excursions by people seeking specific brands.

“What we found is that you can discontinue items that don’t sell but get you a trip,” said Bill Simon, Wal-Mart’s executive vice president and chief operating officer, at the Bank of America Merrill Lynch Consumer Conference last week. “So, we’ve been through the business and put 300 or so of those items back into the stores that were removed. We believe that that’s going to solve some of those issues.”

Other retailers including the SuperValu chain and CVS Caremark (CVS) are pushing ahead and slimming their selection of stock-keeping units. Wal-Mart’s recent retreat may not be enough to mollify manufacturers from Pepsi (PEP) to Kimberly-Clark (KMB), who have the most to lose when stores slash SKUs.

“They would have to be nervous about it,” says Susan Reda, editor of STORES Magazine, which is published by the National Retail Federation. “It’s the manufacturer that has more to lose, and if you’re not a tier 1 or tier 2 company, you’re in a dicey state.”

One of the ripple effects of the economic recession was an almost industry-wide reduction of retail inventory. Wal-Mart, for example, trimmed its U.S. inventory by more than 7.5% last year, in part, to prevent the overstock and price plunges that punished the sector in late 2008. The result for manufacturers varied as widely as their products.

For instance, Colgate-Palmolive’s (CL) sales grew 12% last quarter, including a 5% jump in North America behind the launch of new Colgate products. Procter & Gamble (PG) and its Bounty paper towels, Duracell batteries, Crest toothpaste and Ivory soap, meanwhile, reported a better-than-expected 6% sales increase last quarter as its gross margins and outlook for the fiscal year improved.

“The whole idea of efficient assortment and giving more shelf space to the brands shoppers are looking for the most tends to improve visibility of existing and new items,” says Jennifer Chelune, a Procter & Gamble spokeswoman. “It favors companies that innovate.”

Meanwhile, Kimberly-Clark (KMB) and its Kleenex tissues, Huggies diapers and Scott and Viva paper towels saw sales rise 8.5% in the quarter, but the company reduced its 2010 earnings forecast as sales of core paper products fell 6% when consumers sought cheaper alternatives. Its stock price followed that downward trend. If that’s the pressure being felt by the maker of the tissue that the NRF’s 2009-2010 BIGResearch Consumer Intentions and Actions Surveys say is their favorite brand by an 18% margin, the burden on manufacturers that are lower on the food chain is even heavier.

“Unless you have come up with a product that’s such a standout and so different from the market, you’re not going to make it if you’re just another iteration of ketchup,” STORES Magazine’s Reda says. “If you’re number three or number four in that space, what’s going to set you apart from those other two?”

That fight gets tougher when store brands join in. According to the NPD Group, sales of private-label items increased 8.8% from 2008 to 2009 and nearly 18% during the past decade. Nielsen found that store brands brought in $86 billion in U.S. sales last year, up $14 billion since 2007. With Consumer Reports finding that store brands, on average, cost 27% less than their big-brand counterparts, such a surge can eat away at sales volume for companies like Del Monte (DLM) and Unilever (UN), with the NRF survey reporting that the No. 2 brands of vegetables and ice cream are store/generic products.

However, many retailers still depend on manufacturers to pay for displays at the end of aisles and other prime shelf space, making private-label products a limited option for retailers not named Trader Joe’s. While manufacturers tend to use this knowledge to their advantage and flood the floor with billboard-sized displays of their merchandise, a slimmed-down store selection can be easily expanded through E-commerce. Procter & Gamble, for instance, is using its eStore commerce site as an “online learning lab” to test consumers’ habits and relay that information to online retailers like Wal-Mart and Amazon (AMZN).

“We are a house of brands,” Wal-Mart’s Simon said at the conference. “We prefer to sell national brands because that’s how we can differentiate ourselves in price better.”

Copyrighted, TheStreet.Com. All rights reserved.
Advertisements

2010/03/20 at 17:51 Leave a comment

Augmented Reality Advertising Is Here

Augmented Reality Advertising Is Here

Augmented reality and geo-location really started to gain steam in 2009, and we expect to see even more developments in 2010. Geo-location in particular has really compelling opportunities when it comes to advertising. Already businesses are discovering the benefits they can gain by engaging and promoting services via Foursquare — it was really only a matter of time before bigger companies would start to take notice.

Posted using ShareThis

2009/12/21 at 18:22 1 comment

Is true democracy happening now, on the web, and succeeding (no, Wikipedia does not count)

Firefox 3.5: The World’s Most Popular Browser

Firefox 3.5 is now the most popular browser worldwide, edging past Internet Explorer 7, according to analytics site StatCounter.

The timing has favored FF3.5, however: IE7 usage has died off as people upgrade to IE8, meaning that Internet Explorer’smarket share is currently spread equally across IE7 and IE8. Add together all versions of IE versus all versions of Firefox, and Microsoft’s browser is still leading the pack by a long way.

Nonetheless, the trend lines favor Firefox in the long run: IE’s market share continues its slow decline while Firefox has sustained steady growth.

One very interesting angle to this development is that Firefox, a product of the Mozilla open source group, is truly a people’s product- developed by, and with, input from various programmers who wanted to seize their browsing destiny from the mega conglomerates with the EURO billion R&D budgets and built it collaboratively and over time.
Wikipedia is a similar collaboration, but is not as pure- the content is often self-serving, and is only as good as the sources who post information- the reliability and knowledge of whom is always in doubt.  By definition, Wikipedia is a cross- cultural “democratic” project.  One we all heavily rely on, but its formula for success is also its achilles heel, especially as content curation (big buzz word for 2010) becomes more the norm and web content is held more and more to the standards of print media that it intends to replace.
Firefox is a gateway- its creators and contributors have their own agendas, but its function largely frees it from the bias and agendas that may bring down or “taint” other web phenomena.
Without budgets or campaigns, through word of mouth only, Firefox has passed Safari (which is backed by one of the worlds best branding and marketing machines) and if current trends continue, it will pass IE as the browser of choice.  The thing about grass roots marketing is that its success is the purest and most accurate to measure against ROI (or any other metric).  If it didn’t work, people wouldn’t use it, rave about it, and influence their friends and colleagues to do the same.

The understatement of the millenia would be to say that the web has changed everything, and leveled so many playing fields.  The success of Mozilla and Firefox, more than anything else out there right now, might indicate how and in what ways going forward.

Will traditional media (read: Apple and Microsoft, ha! what an indication of that massive change) be able to respond?  Will they throw money and campaigns and marketing gurus at the challenge, or will they change their models- working more closely with the net’s “everyman” programmers and creators?

2009/12/21 at 16:48 Leave a comment

10 Rules for Increasing Community Engagement

10 Rules for Increasing Community Engagement

Courtesy Mashable,

10 crucial things you need to do to keep your audience engaged with you and with your business/community.

Posted using ShareThis

2009/12/16 at 18:26 Leave a comment

Hiding in plain sight- evergreen brands, evolutionary pace and the Wall Street Journal.

When Rupert Murdoch bought the Wall Street Journal, liberals, old-school journalists and hard-core business-philes all bemoaned the end of an era, of an institution.

There was little doubt he’d leave his mark- Murdoch has never been known to be light-handed, it wouldn’t be too much of a stretch to call him a 21st century William Randolph Hearst.

The majority  readers and admirers were sure he’d promote himself, his agenda (and that of his multitude of businesses).  Fluff pieces on his subsidiaries, corporate profiles of favored friends and partners, an uber-capitalist periodical containing promotional analysis and profiles of businesses that suited Murdoch’s taste.

The Journal has changed, to be sure, but in a much broader sense, inching closer to a right leaning NY Times than a business-anchored daily.  In the upper echelon of global newspapers, The WSJ enjoyed a well-earned spot amongst the elite of the top-tier dailies (elite meaning quality, not snobbish, but that’s a whole other bait and switch of title and subject).

It is increasingly about politics, splashy images and general interest content.  Yet, if you asked most people, including those who cried out at the time of the sale and since, they’d describe it as a business paper.  And that’s exactly what Murdoch and co. are counting on.

For so long, the Journal has been an institution, a cornerstone of commerce reporting and as steady and conservative- in its subject matter, not politics- as can be.  It is ingrained in the collective cultural conscious as such, but that consciousness no longer reflects reality.

How often does this happen?  And how long before we notice?

There are the business school anecdotes about Kleenex starting originally being marketed as a make-up remover, Crisco as candles, Kotex as surgical bandages, Silly Putty as a cheap war-era replacement for rubber, but this is the other end of the brand conversion curve.  Instead of starting out with marketing a product as a specific thing and then finding its unintended usage has far greater upside and viability, this is a brand that has been something for so long that it continues to be perceived to be what it was not what it is.

The reason is lifespan.  Consider TLC, “The Learning Channel,” sister network to Discovery and Animal Planet, it was originally stocked with educational fare.  It has since evolved or devolved into a reality based network with marginal educational value.  It is rarely referred to by its long form name as most people do not perceive it as an educational destination.

Then there’s KFC- formerly proudly known as Kentucky Fried Chicken.  In the wake of the eighties health craze, 90s vanity and aughts obesity crisis, the company has gone out of its way to market itself as KFC, years before they had a non-fried option on the menu.

But the journal has been around for, well, for forever.  And its identity is so integrated into our cultural DNA that the general population hasn’t noticed that it really has changed. Like someone you see everyday who has lost a not insignificant amount of weight, or gone grey, but so slowly, with changes hardly noticeable from day to day, you don’t notice until you see a picture from last year’s company picnic.

The aforementioned bemoaners were right- they’ve just been lulled into complacency by the slow changes, an almost real life evolutionary pace- there was no relaunch, no rebrand no WSJ2.0 campaign here.  It’s a real and steady (d)evolution into a general news periodical with a right leaning agenda.

It’s just hiding in plain sight- behind its evergreen brand.

The Media Equation

Under Murdoch, Tilting Rightward at The Journal

By DAVID CARR

Published: December 14, 2009

There are growing indications in the news pages that Rupert Murdoch, a lifelong conservative, is looking to use The Wall Street Journal to play politics.

Sunday was the second anniversary of the sale of The Wall Street Journal to Rupert Murdoch’s News Corporation.

Mark Lennihan/Associated Press

Rupert Murdoch, a lifelong conservative, addressing the newsroom at The Wall Street Journal two years ago, when he took over

permalink

2009/12/15 at 02:29 Leave a comment

Measuring Social Media Marketing (positing some metrics- do they satisfy?)

a blog by Chris Brogan listing some metrics.  Some good, concrete answers, but I think Mr. Heisenberg would still be skeptical.

Measuring Social Media Marketing

including:

  • % of online conversation (versus competitor).
  • % of coverage improvement.
  • # of new subscribers/attendees/buyers via tracking links.
  • # of new threads, comments, conversations for engagements.
  • # of actions taken (for instance, on email newsletters).
  • increase in $ per visitor, monthly average.
  • # of leads
  • # of sales call conversions
  • unique visitors (all those basic web metrics)
  • more
  • Posted using ShareThis

    2009/12/07 at 05:24 1 comment

    ROI is King.*

    * That’s not a cross-lingual pun, (roi meaning king in French) just a coincidence, but now doubly true, I realize.

    As a burgeoning social media executive who comes from the international sales and marketing world (via licensing, brand and account management), I found this blog from Business Week exceedingly interesting. I twitter, I blog, I use Facebook to promote a photographer, a band and a South African safari camp and run a very successful industry group on LinkedIn.

    I look for the “buzz-” the hits, the new members, the retweets, but often wonder how much of that is still just a simple click of a button. Is it the social media equivalent of reading the book jacket of reading a summary of the Odyssey in high school and then recommending it to others? Or is it actual viral promotion. Or: does it matter?

    In my experience, and way of working, return on investment is what matters. Having been a licensing manager at an educational not-for-profit, with a zero dollar (0.00 USD or ZAR, EGP, CNY, RUB, BDT, etc.) marketing budget, I learned at an early stage in my career that return does not always mean revenue. Raising awareness, creating goodwill, gaining mind-share, PR, gaining outreach and ancillary educational partners, raising the perceived value of a brand’s equity, etc. could all be as valuable, or more valuable than immediate monetary return. But the question there, which resounds here, is what is that return? And how do you measure it? What are the statistics? Maybe even: does it matter what the metrics are?

    I would argue that the last question is the 64 million dollar one. How do you know if what you’re doing is worth your investment (time, money, man-hours, tools) when you don’t have a simple, clear way of quantifying results? You may be gaining revenue, word of mouth, elevated goodwill or endless array of positive outcomes for your brand or product, but not be able to tell because it gets mixed in with the measurements from the more traditional methods. True action to outcome metrics really exist- how does one know that part of the spike in earnings during a tv ad push is actually incidental and comes from earlier word-of-mouth or viral efforts that are just now manifesting themselves in purchases?

    Science (say chemistry, biology, mathematics) talks about direct, indirect, causal, related and coincidental relationships. The first three are generally the easiest to prove, but then, with science, it’s actually usually disproving that makes the advances. The Heisenberg Uncertainty principle rules: the more precisely the position of a particle is determined, the less precisely the momentum is known in this instant, and vice versa. It goes on to state (paraphrasing, of course): one can never discover the empirical truth without setting up false or contrived boundaries to measure a thing. Like focus groups, or revenue return during an ad spend (the ad spend period being the contrived boundary- there’s no way to know that it’s advertising that’s the end-all, be-all cause of anything).

    Apologies, the nerd in me took the wheel for a bit, but the point is this: true ROI can only be known, or more accurately, felt over time. In current global business, that’s the one commodity that almost no one is willing to spend. Metrics for social media effectiveness as regards business will be developed, refined, thrown out and the process started all over again as technology and consumer habits evolve (or change).

    In the meantime, this week’s article by Steven Baker in Business Week raises some very interesting questions, but does not overtly mention the most important: What is ROI (in any given instance) and how does one measure that?

    Beware Social Media Snake Oil

    Hordes of marketing “experts” are promoting the value of wikis, social networks, and blogs. All the hype may obscure the real potential of these online tools

    By Stephen Baker

    For business, the rising popularity of Facebook, Twitter, and other social media Web sites presents a tantalizing opportunity. As millions of people flock to these online services to chat, flirt, swap photos, and network, companies have the chance to tune in to billions of digital conversations. They can pitch a product, listen to customer feedback, or ask for ideas. If they work it right, customers might even produce companies’ advertising for them and trade the ads with friends for free. Starbucks (SBUX), Dell (DELL), and Ford Motor (F) have all testified to the magic social media can create.

    But the same tools carry risks. Employees encouraged to tap social networking sites can fritter away hours, or worse. They can spill company secrets or harm corporate relationships by denigrating partners. What’s more, with one misstep, one clumsy entrée, companies can quickly find themselves victims of the forces they were trying to master. Thousands of bloggers attacked Motrin last year because of an advertisement from the Johnson & Johnson (JNJ) brand they found demeaning to mothers.

    Over the past five years, an entire industry of consultants has arisen to help companies navigate the world of social networks, blogs, and wikis. The self-proclaimed experts range from legions of wannabes, many of them refugees from the real estate bust, to industry superstars such as Chris Brogan and Gary Vaynerchuk. They produce best-selling books and dole out advice or lead workshops at companies for thousands of dollars a day. The consultants evangelize the transformative power of social media and often cast themselves as triumphant case studies of successful networking and self-branding.

    The problem, according to a growing chorus of critics, is that many would-be guides are leading clients astray. Consultants often use buzz as their dominant currency, and success is defined more often by numbers of Twitter followers, blog mentions, or YouTube (GOOG) hits than by traditional measures, such as return on investment. This approach could sour companies on social media and the rich opportunities it represents. “It’s a bit of a Wild West scenario,” blogs David Armano, a consultant with the Dachis Group of Austin, Tex. Without naming names, he compares some consultants to “snake oil salesmen.”

    Critics complain that many of the new experts have adopted an orthodoxy that provides little flexibility for differing situations—or outcomes. Their pronouncements follow a rigid gospel: Be transparent, engage with your customers, break down silos. Yet these strictures don’t always make business sense. Adam Kmiec, director of interactive marketing at Marc USA in Pittsburgh, tells of a company he met with that got much of its revenue from the Defense Dept. and had allocated $4 million for social media. “What do you hope to get?” he asked them. Ultimately, the client decided the privacy-obsessed Pentagon may not be thrilled with a supplier publicizing itself through Twitter.

    FURY VS. BUZZ

    Scrutiny of the hype merchants is picking up. Rob Spencer, senior research fellow for idea management at drug giant Pfizer (PFE), mingles frequently with social media vendors and consultants as he looks for ways to amplify the company’s brainpower. He urges caution. “You have to tread your way carefully and have your B.S. sensors up,” he says. “I call them innovation hippies. ‘Here’s my book for free. Won’t you hire me for $500 to run some workshops?'”

    Social media consultants’ own promotions can collide, on occasion, with those of their customers. Take the case of James Andrews, who was working early this year at the PR firm Ketchum (OMC). As a consultant, he helped companies such as Newell Rubbermaid (NWL), Monster Worldwide (MWW), and FedEx (FDX) work out their strategies for blogs and the microblogging service Twitter. On landing in Memphis for FedEx meetings, he says he had an ugly run-in with a racist at the airport and twittered that he would “die if he had to live” in the city. The tweet produced an outpouring of blogged fury from FedEx employees and a fast apology from an embarrassed Ketchum. But for Andrews, the tweet generated buzz and may even have boosted his brand. “It helps me today,” he says. “I use it as a case study. It creates authenticity.” In June, Andrews left Ketchum to launch a boutique consultancy, Everywhere. He helps Macy’s (M), CNN (TWX), and Jane Fonda promote their brands and monitor their audiences on Facebook, blogs, and Twitter.

    Skeptics can draw from plenty of examples of social media experiments run amok. Consider Saatchi & Saatchi’s ill-fated promotion for the Toyota (TM) Matrix. Targeting young men, a demographic known to resist traditional advertising, Saatchi’s social media team last year created a campaign based on the pranks of the popular MTV (VIA.B) show Punk’d. According to the plan, a prospective buyer of a Matrix would single out a friend to be the target of a prank. The promise: a bit of fear, a lot of laughs, and perhaps a groundswell of free marketing across Facebook, MySpace (NWS), and Twitter.

    Amber Duick, one of the targets in the short-lived campaign, says she received a series of e-mails from a fictitious British soccer hooligan named Sebastian Bowler. He said he was coming to visit her and bringing along his pit bull. He had a MySpace page where he bragged about “drinking alcohol to excess” and participating in riots. One e-mail Duick received was a fake bill for damage to a hotel room wrecked by Bowler. He had left her e-mail address, the message explained, as his contact info. Duick filed a $10 million lawsuit in October and says that to protect herself from the oncoming Bowler, she slept with a machete by her bed. “She was terrified,” says her lawyer, Nicholas Tepper.

    In a statement, Saatchi and Toyota wrote that they would “vigorously defend against the claim,” which is “entirely without merit.” They said the plaintiff had granted “her permission to receive campaign e-mails and other communications from Toyota.”

    CAN CHAGRIN BE GOOD?

    James Cooper, Saatchi’s digital creative director, says social media, by their nature, are unpredictable, which makes them an easy target for critics. “Anyone who says ‘This is going to work’ is either lying or deranged,” he says. He compares the risk model with venture capital, where one bet out of 10 might pay off richly, while the others struggle or even bomb. And he stresses the difficulty of measuring results. “If something’s got 20 million hits on YouTube, that’s a good thing,” he says. “But what if half the comments are negative? I don’t think anyone’s got a long-term case study yet.”

    Baker is a senior writer for BusinessWeek in New York.

    permalink

    2009/12/04 at 18:19 1 comment

    Older Posts


    Contributors

    tweets

    Error: Twitter did not respond. Please wait a few minutes and refresh this page.

    posterity