Wednesday, September 29, 2010

I Flew Delta And All I Got Was A Lousy Magazine

When I was in college, I signed up for Delta Airlines frequent flyer loyalty program because of the all the flying I was doing to and from school. However, as the price of oil continued its climb, this college student was priced out of the market and forced to find a new method of transportation. Needless to say, I never amassed a staggering number of miles.

Now, several years later, I'm receiving letters from Delta Airlines warning me that my frequent flyer miles will expire at the end of the year. The letters read.

ATTENTION VALUED NEW YORK SKYMILES MEMBER

A records review of expiring mileage balances indicates that you currently have miles which are expiring soon.

As a New York resident, your last chance to redeem your miles for these magazine Awards is September 28, 2010. Remember failure to complete a qualifying activity in your account by December 31, 2010 will result in the expiration of your miles. For more information about qualifying mileage expiration extending activities visit delta.com/skymiles.

Be sure to redeem any of the miles you've earned by recording your selections on the back of your Awards Claim Certificate...

I think a letter like this one is a strong indication of just how broken airlines like Delta are.

First, the tone of the letter is completely wrong. This is a correspondence for its loyalty program reads more like an eviction notice or a subpoena. "Remember, failure to complete a qualifying activity in your account...will result in expiration of your miles."

That's certainly not the right tone if they want to win back customers that used to fly Delta with enough regularity to belong to their loyalty program.

Secondly, there is something quite ironic about Delta using the word "VALUED." I don't feel valued. All that flying and I only get a couple of magazine subscriptions. Also, I don't understand what being a resident of New York state has to do with it any of it.

Remember, I could certainly prevent expiration with a "qualifying activity," as the letter threatened. Such a qualifying activity is? Buy more miles and not fly anywhere or transfer miles to a friend, lose some of them, but stay active. Thanks. Obviously both solutions are quite counter productive for the consumer.

In the end, all this letter did was reminded me why so many airlines are bankrupt. And how I don't really care at all if my miles do expire.

Friday, September 24, 2010

Bud Made Its Own Bed



Good news, Budweiser is going to buy your next beer.

In an effort to jump start lagging sales and lure new loyalists, Budweiser is giving away free beer (21 and over of course) during its National Happy Hour next week.

While free beer is quite a gesture, I have my doubts about the effectiveness of the move. The recent sales slide (18 percent in two years) is more a result of an unfocused long term marketing strategy at Anheuser-Busch.

In 1981, Anheuser-Busch started extending the Budweiser brand with its launch of Bud Light, to compete already established light beers by Miller, Coors and Schlitz.

But Bud Light didn't just compete, they took over the light beer category. Now it's the number one selling beer and has the highest market share with 28 percent.

However, Bud Light didn't become the success that it was by only stealing business from Miller Light and Coors Light. Of course, the core brand Budweiser would also be affected.

Sure enough, in 1989, Budweiser saw the first sign of decline; a trend that has continued for 20 years. In 1988 Budweiser sold over 50 million barrels. By 2008, they only sold 23 million barrels.

The problem with brand extensions is that their success isn't just at the expense of the competition, but the core brand as well. Yet, many marketers cannot see this fact; even though they often justify extension by reasoning that they're capitalizing on the brand's equity and awareness.

If that's the case, it's logical that the extension will disproportionally affect the core brand compared to competing brands because of the high equity in the name.

Unfortunately, that has not stopped brands like Budweiser. In the past decade, Budweiser has introduced even more new extensions, Bud Select, Bud Light Lime and Bud Light Golden Wheat.

Suddenly, it's very understandable how Budweiser is a shell of its former self and has to give away the brew for free.

Tuesday, September 21, 2010

Self Motivation

Beware of those seeking self motivation.

If someone asks if you are self motivated, that's a clue that they want you to work for less than your worth.

If your motivated, you'll know it.

Friday, September 17, 2010

You Can't Take It With You When It Dies

Ann Burr, a Frontier Communications executive, recently discussed the decline in landline phone use in an interview. Obviously, this is a very critical issue for the company and the local economy, where Frontier employs 1,300 people.

The catalyst for the interview was a recent government report that stated one in four households in the United States don't own a landline telephone anymore. And that number is rising. The same study done in May 2009 found that about 20 percent were landline free.

But Burr is taking the glass half full approach. She says that in Rochester more than 75 percent of homes still have a landline telephone. Just how much more is the question.

But her words hardly evoke optimism. "I don't see that for a long time," referring to the extinction of home phones. But the company's actions are the real tell. To keep their phone business alive, it has extended its brand, bundling phone service with television and high speed internet. And they are even testing a wireless service.

But an brand extension strategy won't translate into a leadership position with the updated technology.

Clear evidence of this can be found just a few of city blocks from the Frontier office. Kodak tried the same strategy to resurrect its brand name for the new digital age. However, when people hear the Kodak, they think of film.

Its a textbook example of what happens when a product category dies. You simply cannot the brand name with you.


A side note from the editor:

The answer to Frontier's problem may be in the first paragraph of the news report.

Double check what government agency issued the report. It wasn't the FCC. It wasn't even the FTC. It was the CDC; The Center for Disease Control. Why would they be interested in this information?

Perhaps because some scientists have linked major health risks such as brain tumors to heavy cell phone usage. Which keep on growing. Additionally, the amount of information wireless signals must carry keeps growing as well. So naturally, the signals that we expose ourselves to keep getting stronger.

Which may be the marketing fuel that Frontier needs. A great consumer influencer like fear. I would recommend putting resources into commissioning studies on cell phone health risks.

Similar to tobacco, make cell phones public enemy number one.

Thursday, September 16, 2010

Google

Just a thought:

With widespread use (and from anywhere with lots of phones) of Google and other online search tools, is there really any reason for an established brand to add a phone number/address or some formally critical info to a billboard?

Wednesday, September 15, 2010

Not Just Talk

It's no secret that media is changing. One consequence from the change is television audiences are becoming more fragmented. Even if the overall pie keeps growing, the slices keep getting smaller and smaller.

As purely anecdotal evidence, here are the television ratings for the series finales of 'Lost' and 'Seinfeld', both mega hits that were the most popular show in their day.

In 2010 'Lost' reached an average of 13.5 million viewers. 'Seinfeld' totaled approximately 76 million viewers.

How will marketers adjust?

Friday, September 10, 2010

Too Much of A Good Thing

A couple months back I applauded Reebok (and Skechers) for their creation of a new category: toning shoes.

Now, I'm certain I gave them too much credit. Alas, both have introduced toning shoes for men.

Too much a good thing can be a brand killer.

Thursday, September 9, 2010

Be Cautious When Positioning Your Brand

If you have ever read or listened to financial news then there I'm sure you have heard the following words roll off the pundits' tongue: retailers were down as cautious consumers are worried about the future.

We all know that these last few years, a statement like that has been total understatement. The recession ultimately resulted in massive sums of wealth to simply dissolve. Meanwhile, consumers are and will remain extra cautious with their discretionary income until their personal fortunes are rebuilt. So, it's easy to see that retailers are hurting because, as a whole, "the consumer" is.

So, given that grave reminder of financial hardship, don't you feel like going shopping?

I'm guessing not.

But that's not what Kohl's may be banking on. According to Ad Age, they're pumping $20 million to their advertising spend to position itself as "the smartest choice for the cautious consumer."

First of all, that's a slogan and not a unique marketing position. Its true position is Kohl's has low prices. Which happens to be the same position that most retailers try to stake claim to but is dominated by Wal-Mart.

Fortunately, Kohl's has always taken a price position. They're not trying to make a fundamental change to respond to the change in the economic climate.

But a slogan's purpose is to reinforce its position in the mind of consumers. If "the smartest choice for the cautious consumer" turns up in its next round of advertising (like it has it news articles) then their plan will backfire.

The reason is the word cautious. It's a strong word with a lot of power. Obviously spun from the word "caution," so it makes people stop. The word completely overshadows and overpowers "the smartest choice" from the slogan. "Caution" is what we will remember. Further, as the slogan's most emotional word, it demonstrates how the consumer should feel.

Do they want their customers feeling cautious? Of course not.

That feeling only makes the consumer question if they truly need that new shirt or pair of pants, especially with less discretionary dollars to play with.

I would rewrite the slogan to get rid of the word "cautious." Possibly something like:

Kohl's is the best choice for the consumers' conscience.
Kohl's is the wisest choice the consumer conscience can make.

That said, any changes to their marketing is curious speculation at this point. According to a transcript of Kohl's 2010 second quarter financial report conference call, which took place on August 12, executives said "Our marketing efforts remain unchanged. We continue to utilize the highly effective 'The More You Know, The More You Kohl's' platform."
We will have to wait to find our final answer. But, as a marketer, I would be very cautious about making a change like that.

Feel free to comment and send in your Kohl's slogan ideas using the link below. As always, I look forward to reading them.

Sunday, September 5, 2010

Come In, We're Open

It's an all too familiar scene. You go shopping and the sign outside reads "come in, we're open" but the employees' expressions clearly say "go away, we're closed." Maybe they're tired, upset, having a bad day or simply don't like their job.

But technology is working to eliminate this problem.

Your website works 24 hours a day and never complains. Plus it's super efficient; everyday it multitasks and can handle multiple questions from multiple customers at the same time. Even better, it only tells your customers the stuff that you hope they hear. No it's doubt your shrewdest employee.

Or is it? Although technology has improved many functions of business, it doesn't have the ability to replace any of them. Including good service, despite claims of the wondrous powers of technology.

Consider these common web characteristics.

Does the page lack a tone of voice and read like boilerplate? What might this say about the company? Humans don't work here. Humans don't shop here.

Is the telephone number prominent or buried in a maze of links? Don't see it? Try looking at the tiny font on the bottom of the page. Or you could email them. Who are you sending the email? Is it Mrs. Jones the VP and COO or is it info@badcompany.com.

But none of that really matters if no one responds (which we all know is all too normal of a practice). Perhaps you're lucky and receive a response. Is it automated or personal? How fast does it arrive. Does it actually solve your issue? That would be quite a feat for an automated response email. I find with them that the message is always the same- we strive for the least service that's acceptable.

I'm sure these experiences sound familiar. In such cases, they're no better than a disgruntled employee; they too scream "go away, we're closed."

Good service takes sacrifice and is more about attitude than anything else. Just because the customer is not standing in the store or on the phone doesn't mean the practice is suddenly dead.

Treat your website like the front door of your business. It's an opportunity to create more work, not minimize it.