Atomic Ideas - Helping You Sell More Stuff!

CPG Brand Relevance Versus Retailer Demands

The struggle between retailer profits and CPG brands is reaching new highs.  Wal-mart has aggressively been pursuing co-op advertising -- essentially having vendors cover significant levels of their holiday advertising costs.  Other retailers are making merchandise decisions that will have direct impact on brand visibility and, potentially, consumer perceptions of brand relevance.  These retailers are not just reducing the presence of brands, but eliminating brands from their shelves in favor of greater line depth from those products they are keeping and expansion of private label products.

For example, CVS will be removing nearly all Energizer batteries, while Costco will no longer be selling Coca-Cola products.  There are a number of reasons for these shifts, ranging from retail margins to consumer purchase patterns.  But the key impact is the apparent power shift from CPG brands to retailer control.

Retailers generally cannot just eliminate brands without worrying about the consequence of shopper rejection.  After all, if the brand is important enough, consumers will reject the retailer.  The reason that retailers are able to make these decisions is that the consumer is letting them.

The question is whether consumers are accepting these changes in order to get greater price sensitivity and if they are willing to permanently forgo brand choice.  If this is just the beginning of a trend then CPG companies are looking at a new battle.  Most companies usually worry about "what does my brand stand for."  Now the bigger question may become is my brand relevant in today's market.

Retailers will not drop a brand if their customers demand its presence. But if consumers do not see a difference between brands then loyalty and demand is fleeting.

The key has always been understanding the consumer and why they would want to buy your product.  However, now it is even more important.  Having an open and on-going dialog with your customers is even more important today than ever before.  People have become more judicial in how and where they spend their money.  You need to consistently hit the sweet spot in terms of communication and messaging.

The bad news is that the market has dramatically changed in the past 12 months.  Many of the rules and perceptions have changed the marketing landscape.  Brand relevance may not be the same as it once was.  If a marketer is not careful, they are likely to be part of the background rather than being seen out in front as a leader (which is what most retailers will be looking for).  Just ask Chrysler and GM about the impact of not being relevant to their audience.

The good news is that there are more avenues than ever with which marketers can talk to and interact with consumers -- from Social Media outlets to traditional and non-traditional market research techniques.  Using all these avenues of communication and evaluation will allow a brand to connect with the marketplace and retain its relevance.

And with relevance comes consumer demand.  And with consumer demand, retailers will have to provide retail space for them to retain their own relevance.  The battle between retailers and CPG brands has begun.  The side that better understands and utilizes the consumer is going to win this battle (hopefully with the consumer being the overall winner).  It should be interesting to watch and see who does it right and who is shuttered to the sidelines.

Black n' Blue Friday

Seems just about every retailer  has a "Black Friday" sale.  "Black Friday" sales are definately the "hot" marketing tactic. 

In fact, I even saw a TV commercial for Maaco for their "Black Friday" sale. Seems you can save big on every paint service they offer until Saturday at noon. The problem is, I saw the commercial at 11:12 pm Saturday night. 

Not only have they wasted their money by not utilizing this "hot" tactic correctly, but now I actually have a lower opinion of them. If they can't get their advertising right, what else will they mess up? My paint job?

It's the same with marketers and the "hot" tactic of social marketing. Done incorrectly, companies at best lose their window of opportunity for influencing consumers at the proper point in the buying cycle, and at worst, they risk converting a neutral attitude to their product or service, into a negative one. 

Truly Special.

During this Thanksgiving, also a time of economic stress, I’m thankful for the things I sometimes take for granted. 

I’m thankful for the gathering of family and friends, thankful for a tremendous meal, thankful (I think) for a rare televised Lions game, and thankful for the most faithful dog on earth, Byron. 

But, to be serious for a moment, the thing I’m most thankful for, and don’t mean to take for granted, is the courage and bravery of the thousands of American men and women of the military who are in the life-threatening foreign lands of Afghanistan and Iraq. I don’t know how they do it – but they do, everyday. They are truly special.

 As Churchill said during WW II, “Never in the field of human conflict was so much owed by so many to so few.”

 

Your Company's Other CEO

I was at a Tweetup last week, listening in on a conversation where a person from an internet company was explaining to another person about the supreme importance of 'SEO' - Search Engine Optimization - for companies. The real listener (not me the eavesdropper) was nodding up and down as the internet guy nodded up and down. They were both extremely agreeing with each other on the importance of SEO.

Well....yeah.

And yes, there still are companies that haven't done proper Search Engine Fundamentals, or the fancier term, 'Optimization'. Wikipedia definition: "Optimizing a website primarily involves editing its content and HTML and associated coding to both increase its relevance to specific keywords and to remove barriers to the indexing activities of search engines".

Translation - SEO helps people find your site.

Getting ranked high on search engines and increasing traffic to your site is a good thing.

Then what?

When the search engine fundamentals are addressed, the other, more challenging half of the equation kicks in, what we at Atomic Ideas call  'CEO' - Customer Experience Optimization. CEO is the experience a visitor has when they visit your site or your store, or calls your company.

CEO addresses how it feels to be on your site, from a visitor's perspective, how it feels to be in your store. How the layout is on your site/in your store, the writing tone on your site/clarity of signage in your store, the ease of navigation on your site/through your store.

How easy is it to engage with you at whatever buying step I'm at - whether gathering information, or ready to buy. Amazon is a terrific example of top-notch Customer Experience Optimization.

SEO focuses on dealing with the search engines. CEO focuses on taking care of conversing with your customers. That's what top-notch marketing agencies help clients excel at.

If you have good SEO, you're in the game. But you need great CEO, or you're dead in the water. Without great CEO customers click to your site - click off your site. Walk into your store - u-turn out of your store.

Customer Experience Optimization applies to both your customer's online and offline buying experience, since we search online, but we live offline.

How's your other CEO? The one every customer meets?

Photo: mmetcalfe

Has Cadillac Made the Best Decision?

I read with great interest last week the GM announcement that BBH, Publicis and Martin Agency were named as finalists for the Cadillac business. All 3 agencies have prior automotive experience; as did the 3 other agencies that did not make the cut.  Each of the finalists are good agencies and are likely to bring strong efforts to the pitch.

However, I find their decision very interesting -- and a little confusing.  As GM continues to move out of bankruptcy and "re-introduce" its brands to America and make them relevant again, there is a need to be aggressive, to take advertising steps that separates GM brands from the pack.

Even Bob Lutz has said, "We have to shock Americans into a new awareness about the competitiveness of GM products." (see Edmonds.com article)

That said, my question is, why were there no agencies included who are new to the auto business?  There are plenty of smart, creative shops who can handle the business.  Every day agencies win new business where they have to learn the category.  Why not for Cadillac?  Shouldn't the Ren Cen team have taken the chance on at least one agency to see if they can bring in a completely fresh point of view?  Shouldn't they have at least included one agency that might have broken the mold, even if a little?

If the comfort zone cannot be broken for including an agency outside of the industry, how can Cadillac and GM expect to find creative solutions that will succeed in meeting Bob Lutz's  vision of: "We can't do it the way we used to do it ... We've got to take it on boldly and head-on."?

We, in Detroit, need a successful GM (as well as Ford and Chrysler).  In this time of business crisis I would find a little more comfort, if when given the opportunity, GM would at least try to "boldly go where no man has gone before."

Restaurants Are Developing an Appetite For Social Media.

Restaurants are by nature social places. We gather at them with friends and family just to hang out or to celebrate both small and momentous occasions.

So it stands to reason that restaurants would be a natural for incorporating Social Media into their marketing plans. Collectively, the Atomic Ideas team has a lot of experience in both restaurants and Social Media, so we monitor what is happening with "social" in the restaurant industry.

For all of you that have not yet embraced Social Media, there is a lot of evidence that it was working for those restaurants using it. So to help you make the leap, we thought we'd give you a few examples.

 Right here in Michigan Wendy's is experimenting with Twitter. On a warm day in the summer, they sent their followers a Tweet saying that if they came into a Michigan Wendy's and said "brrrr" between 5 p.m. and 7 p.m. that day, they'd receive a free Frosty shake. Now there's a fun, simple, easy idea! And it worked. According to a newspaper article,  Wendy's followers loved the idea and retweeted the message to friends. A spokesperson for Wendy's said, "We've been really overwhelmed!" 

Not bad! Overwhelmed is good when the industry overall is underwhelmed.

Then there was the mega promotion by TGI Fridays on Facebook. 

It all started after a bet with a fan called Woody, their self-proclaimed number one fan. If Woody could get 500,000 Facebook fans by the 30th September, 2009, the first 500,000 would be entitled to a free Jack Daniels Burger or Jack Daniels Chicken Sandwich.

He got 500,000 and more. In fact, they reached 500,000 so fast, they had to revise the rules and open it up to up to 1 million people. Check out Woody's Fan Page here and you'll see he has almost a million fans.

That's a lot of free burgers and expense to TGI. However, the free publicity this promotion generated alone is worth millions. Not to mention the additional dollars generated (need fries and a cocktail with that burger) and potential repeat business.

These are just a couple of examples on two of the hottest platforms. They show the power of social media and how it can be a successful part of your marketing mix. And you don't have to go all out, all at once. Do some research on the platforms that are out there, develop a strategy for the one you think might work best for you, and then dip a toe in the water. Or call us, we'd be happy to help you sell more stuff with Social Media.

Next Monday, We'll follow up with specifics about the different Social Media platforms restaurants are using and give you insights into how they could work for you. Meanwhile, below are a few related articles you may be interested in reading.

Dairy Queen Case Study

Tweetable Eats: What Street Vendors Can Teach Businesses About Twitter

Social conversations are the new case study

I got nothing

 What do bloggers do when they get writer's block? They surf the web, they check out you-tube. Anything to get an idea to spout about. I like the good old days when something important happened or there was a burning issue that needed to be ranted about first -- then it got an article written about it. But many bloggers, myself included, feel compelled to write a blog on a regular basis -- important issue or not.  Something to do with rankings in the blogosphere, people counting on it, etc.

I, for instance, have just completed a big assignment, there is no big issue weighing on my mind, and I have just had a big meal and am feeling quite content. The last thing I want to do is rant. So here I am blogging just to keep a tenuous rank in the blogoshphere. Does anyone else feel the same way? (Because of course, getting people to comment on a blog or answer a question is another way to boost the rating).

Well, that's all I have to say on the subject. Which isn't much. But you pretty much knew that from the title.

Just another Newsweek cover?

On Tuesday, I saw a video excerpt from the upcoming Sarah Palin interview by Barbara Walters.

 

Barbara asked Sarah about her recent Newsweek cover, “a wee bit degrading,” an appalled Palin responds. "A wee bit degrading"? What does she mean by that? The cover shows Palin posed in running attire with shorts that expose her tanned legs. Didn’t she choose to pose for this photo when she was featured in Runners’ World? What’s the problem? Well, it seems Newsweek had the gall to use a photo from that well-known celebrity tabloid, Runners’ World.

 

Couldn’t they use a shot from last years’ presidential campaign, or from a recent press conference, or even one from an aerial hunting excursion? Yes, it would’ve made the Newsweek story more objective and it would've carried a little more weight.

 

However, those tame shots wouldn’t help sell as many Newsweek issues as the more revealing Runners’ World photo. That is the underlying theme here: increase sales. The desire to increase sales has blinded rational, objective journalistic decision-making. In these economically depressed times we have to sell as much as we can, when we can. And if it means using a somewhat out-of-context cover photo, so be it.

 

And speaking of economic motives, lets get back to Sarah Palin’s. Isn’t she the one, an adult, married, mother of five, and an ex-governor with well publicized 2008 election debts who willingly posed in the clothes of her choosing to be seen by any readers of Runners’ World?

 

With that smile and pose she seems to have a look of pride and self-assurance – this isn’t just accidental happenstance, she wanted to look good. She’s been doing this for quite awhile. (You know, she’s been in a few beauty pageants.) Why not? Looking good will attract more readers to Runners’ World and that in-turn, could help her sell more copies of her new book. –  And selling more of her book would be great. I guess that’s what “a wee bit degrading” means. I think it’s a “how far should I go in selling myself” thing. 

In the end, for everyone, it all comes down to just trying to make a buck in these trying times. Check out the cover above - what do you think? 

Another Round of Angst and Opportunities

To update the merry pranksters Monty Python: "And Now for Something Completely Similar". 

Companies wrangling with how to handle social media remind me of a decade or so ago when I was in meetings with clients who were debating whether their company needed a web site. Heated debates. With upper management. After all, they had an 800 number. What did they need a web site for? "No one buys from a web site".

And then there were meetings with risk-taking clients who said "Yes, we're going on this World Wide Web. Here's our brochure to follow when you design this thing". A brochure on the web. With a link to send an email.

Businesses (and agencies, let's be honest) were struggling with how to wrap their arms around this new technology that went beyond emails. It was exciting, confusing, anxiety-filled, people uncertain of its value to business in actually selling something.

Sound familiar? Same struggles with social media. We all know the direction businesses went with web sites. Do you know a business that doesn't have one? Are they in business?

Web sites exposed company offerings 24/7, letting customers check a company out whenever the customer wanted - after the company was closed, in the morning before the company opened.

Companies gave up some control when they put up a web site - salespeople weren't always there to give the sales presentation. The web site would be giving it when the customer wanted it, and then the customer could click off and the company wouldn't know who saw what. That was scary to clients.

Social media takes it a step further. Customers now can not only see a company whenever it wants, customers can talk about a company whenever it wants. (How cool! But let's get back to the angst...).

There was a trick back in the frontier days of putting up a web site and the same trick applies now in getting involved in social media. Except it's not a trick. It's a succinct set of guidelines that are bigger than Web 1.0, Web 2.0, even C3PO:

1. Know your customers - your 'best customers'

2. Know what you have that your best customers want/need - your 'marketable truths'

3. Let your best customers know your marketable truths in a relevant, honest, entertaining, sociable way. In other words, know what you want to say and now, be ready to say it when asked.

Web sites, billboards, Twitter, TV spots, Facebook, etc. are conversation tools. They're conversation-starters.

Guideline 3 mentioned 'honesty'. The buzzword for that these days is 'transparency'.  Same thing. You wouldn't b.s. your neighbor when telling her about a restaurant you like, or telling a relative about the cool phone you just bought.

You'd most likely tell them why you liked it, what about it you like, and knowing them, why it might be something they'd like. You'd just put it out there, listen to their questions, answer them honestly, and probably express a little excitement over the food and ambiance at the restaurant, the cool features on the phone that make your life easier. You'd be 'transparent'.

Web sites and social media allow you these kinds of conversations with customers. So does traditional media. Imagine your customers as a neighbor or relative (a relative you like) and market to them/converse with them that way.

Imagine the possibilities. Open dialogues. We're seeing it all the time with our clients. People talking to people. Having more conversations. And actually selling stuff.

How have your conversations been working out in your business? Is it being addressed with angst or as an opportunity? Or both?

 

The Politics of Branding and Branding of Politicians

What do Sara Palin, Tim Pawlenty, Mitt Romney, George Pataki, Mitch Daniels, Bobby Jindal, John Thune, Mike Pense and Haley Barber all have in common?

They are among the many Republicans who are unofficially jockeying for the 2012 Presidential nomination.  I say unofficially because no one has formally declared yet.  What all of these people are doing is testing the waters, putting out feelers, doing polling.  Trying to determine if they can be the leader of choice, the people's preferred candidate.

Unfortunately this is not about politics -- having a better idea, offering solutions to fix our economy, health care, international relations, etc.  It is about branding.

All of the people above, and more, are trying to find their personality.  Someone that can lead the Republican party back to the White House -- and is no different that what Obama did in the last election.  To win an election issues have been replaced by branding.

What really bothers me it that it is still 2009.  I am not personally ready for 3 years of positioning, thrusting and parrying, oneupmanship.  Besides many of these people are currently members of Congress  or Governors.  Shouldn't they be in the business of governing rather than than "testing the waters' for their future?

It has dawned on me recently that politics have become more like selling a product rather than governing.  It is developing a brand that people want to be part of.  If you are not in power then you attack the person or party who is.  Forgot about compromise -- it is my way or the highway.  And that is a sad state of affairs. 

It can work in the business world where you are always looking for the newest, best alternative to sell and market and you can sell against the competition.  But I am not sure this is what we want from the people entrusted with managing our country and our future.  Do we really want to spend the next 2 1/2 years watching politicians develop their brand or do we want them to work for successful solutions to our problems.

I may be naive and tilting at windmills, but I think that when we get back to recognizing that governing is compromise and that people should be elected based on how they can help this country rather than their "brand image", the better we all will be for it.

Let's leave marketing and branding to the business world and remove it from the political arena.  We might find we are all better off for it.