Thursday, May 31, 2012

JC Penney Follow Up

Not too long (11 days) after I wondered if JC Penney's would have the patience to stick with their promotion-free pricing strategy, it's being reported that they will be adding more "best price" sale days.  Adding five sale days may not seem like much, however, JC Penney is a little more than 90 days out and is already wavering from its plan.  That's not a good sign.

If JC Penney was going to make changes to it, and I believe they needed to, they need to work in the opposite direction.  I'm confused just reading about the three-tier pricing strategy.  They need to clear up that confusion, not with more sale days, but with a one-tier always low price.

Saturday, May 26, 2012

Simple or Simply Too Vague

Driving back home to New York today I saw a truck belonging to a coffee company which had their slogan on it. I cannot remember it exactly because it was a very generic and vague slogan; but it was something close to "Experience the Difference." While simplicity is great when marketing to busy consumers who are bombarded with thousands of marketing messages everyday, it's imperative not to mistake simplicity for vagueness.  If you do, your message won't resonate with any audience in a meaningful way.

At the risk of defeating my point, a quick Google search for "coffee company columbus ohio experience the difference" turned up a top result of the Cadillac Coffee Company.  But I'm confident that most  consumers won't be as inquisitive.    

Friday, May 25, 2012

Destination For The Ill

In January 2012, Walgreen's opened debuted a massive flagship store in Chicago, with everything from sushi bar, spa and expanded wine selection that includes $2,000 bottles of Remy Martin Louis XIII cognac in Baccarat crystal.  According to company executive Joe Magnacca, Walgreen's is attempting to "transform itself from a traditional drugstore to a retail health and daily living destination."  Wow, what a quote. 

But really, Walgreen's a "destination?"  I always thought of drugstores as the opposite of destinations.  They were a place on the way - somewhere between point A and point B that was convenient to stop for a couple of items and be on their way quickly.  Isn't that why they're on nearly every street corner?  

Walgreen's over-the-top Chicago flagship location couldn't possibly scale nation-wide and I even have trouble envisioning one for every major city.  I would caution against the pharmacy superstore concept because they become far less convenient for customers, which is a major brand pillar of Walgreen's.     

If Walgreen's wants to be a destination spot, make it a destination for the sick.  Focus on the pharmacy and medical stuff and ignore the ancillary stuff.    

Wednesday, May 23, 2012

Just A Click Away

It's still people who are the greatest source of information - the internet cannot change that.  Your best sources of information are likely more than a couple of clicks away.

Sunday, May 20, 2012

A Penney For Your Problem


Back in February, JC Penney's declared a major shift in their pricing strategy; doing away with the discounting that their customers have grown accustomed to.  At Penney's, constantly slashing prices became a thing of the past.  Yet, still wanting to maintain their low price marketing positing, JC Penney's shifted to an "everyday low price" strategy and message.  

Or at least that's what they were hoping for.  In a recent presentation to investors and analysts, JC Penney's CEO Ron Johnson explained that while their marketing was entertaining and engaging consumers, it wasn't doing the "hard work" of actually marketing, which resulted in a larger than anticipated loss of $163 million in the first quarter of 2012.  

While the ads for JC Penney's new pricing strategy are straightforward, the message consumers are greeted with on the sales floor isn't as simple.  Despite a strategy that whittles down promotions from 590 per year to only 12, the "everyday low price" is still a confusing three tier jumble that includes "everyday prices," month-long values and "best prices." With three different low prices, Penney's isn't exactly practicing "everyday low," causing confusion for its customers.  

Slightly adding to the confusion, JC Penney's also jumped on the trend of giving themselves a nickname (JCP) and utilizing it in their branding and marketing rather than using the nickname that their loyalists customers gave them (Penney's).  It may not seem like a big difference but nicknames are important and make a huge difference to brands trying to get into the heads of consumers. While JCP is actually shorter than Penney's spelled out, it's not easier.  JCP is three syllables whereas Penney's is two; thus you're more likely to hear a shopper utter the phrase "let's look in Penney's" than "let's look in JCP."

Even though Penney's price-centric messaging is confusing, fixing the confusion might not resolve their problem.  After years of training customers to patiently wait for the best deal they could find, going cold turkey from discounting might be an impossible marketing challenge.  The Penney's customers has been well-trained in the game of trading coupons for cash off.  Adjusting will take more than a couple months time and even then some customers might never adjust.  Why?  For human beings, habit is more powerful than choice.  And most coupon cutters do it out of habit.  Consequently, without coupons in their hands that say Penney's, a visit to the store is no longer on the itinerary. To them, the coupon or sale is a signal that says they're getting a deal.  

They're certainly are people who, even without coupons or discounting, still associate JC Penney's with low cost clothing - I am one.  The drawback to this is the low price position also signals less fashionable to these shoppers.  They were never enticed by price, out of similar habit and training, they look for higher prices to signal higher fashion.

Thursday, May 17, 2012

When The Other "Toning Shoe" Drops

Almost two years ago, I wrote about the rising toning shoe category that Skechers created with their Shape-Ups brand.  Back then, I wrote how it was great strategy by Skechers to create the sub-category and I also applauded Nike for not, pardon the expression, running into the mix despite the category exceeding $1 billion in 2010.    

So just like the consumers who bought the shoes, unfortunately I neglected the obvious questions in 2010, too busy praising them executing a great strategy that I ignored this miracle shoe's too-good-to-be-true claims.

However, consumers learned quickly that toning shoes were built on promises they couldn't keep, thus leading to Skechers recent $40 million settlement with the Federal Trade Commission to exonerate themselves from  charges of false advertising. Meanwhile, Reebok settled their false advertising claims for $25 million.  The empty promises made were that toning shoes somehow activate key muscles differently and that people wearing the shoes could "shape up while they walk." An investigation into such claims also lead to the discovery that a chiropractor who supported these claims in a independent (wink!) study was married to a Skechers employee.

Legendary ad man Doyle Dane Bernbach famously said that "a great campaign only makes a bad product fail faster." So will lying about what a product can do.  That creates lawsuits which only accelerate the failing process.  Lawsuits get products pulled from shelves and employees fired without hesitation.  Although, Reebok said they still believe in the toning shoe category.

I just don't know if I want to believe them.  I too wouldn't want to relinquish category leadership so easily.  But without the promise of building a great butt without breaking a sweat, all they have is a really ugly pair of shoes.  I think it's going to be very interesting to watch where Reebok and Skechers take the toning shoe category next.         

Tuesday, May 15, 2012

Lenses

It's the job of every marketer to look through the consumers' lens.  Always ask "why" from the consumers perspective.

Sunday, May 13, 2012

Not Content

If you are a regular reader of this, you know that I am a frequent reader of Advertising Age, which I site as a source for many of the topics that I discuss.  This week, when I clicked on to read the online edition, I noticed a new section the website's front page with the title "From Around The Web."  This section features articles published by outlets such as the New York Times, Wall Street Journal and Bloomberg.      

But does this new element to AdAge diminish their brand name at all?  Sharing content with other sources, trusted or not, is a another step toward toward the commoditization of the brand name at the top of the page.  It's an admission to the reader that what they're offering is becoming generic and thus the value added by the brand is lessened.  

This content sharing approach obviously caters to the way people interact on the internet but what will the consequence be for the brand names of these outlets long term?  Will the source of information not matter to the reader?  To a large degree, I think it already doesn't.

Which is terrible news if it's your job is to report it.

Thursday, May 10, 2012

The Journey

The journey is the reward; they're won't be a pot of gold waiting for you at the finish line.  It's easy to lose sight of this fact when you're young and/or struggling.

Wednesday, May 9, 2012

Saturday, May 5, 2012

Speaking Of Artisan...

The message to customers in new Domino's artisan pizza commercials is a odd one.  Basically, it says "no, you cannot add your favorite toppings to this pizza."  It's as if this ad could be a window into the minds of Domino's employees, who are exhausted from having to regularly reply, "sorry, but you cannot change this pizza." They're done repeating themselves and this is the solution. 

The straightforward approach of telling customers what Domino's cannot do for them might be celebrated by Domino's order takers; however, their is a better way to tactically position this pie.  I think it would go something like - Domino's Artisan Pizza: there can be no such thing as better than perfection.

However, the outbursts by Domino's customers should be a clear sign to Domino's marketers have completely lost touch with the Domino's brand.  It's no secret that Domino's isn't exactly the California Pizza Kitchen.  They serve average pizzas at a better than average speed and for a low price.  Say Domino's and I'd guess most people would picture a dorm room floor before they think dining room table.

So please excuse the customer, who for the past fifty-two years has been conditioned to tell Domino's what they want on their pizza, because they didn't realize they had called Le Domino's.

I have maintained for more than two years that much heralded "Domino's Pizza Turnaround" was a bad from the start.  Associate Domino's with great taste?  Sorry, it just doesn't fit; especially when your selling a pizza for less than $10.   And now "artisan" for less than $10?

Since the renaissance began at Le Domino's, the messages have been as varied as the pizzas they serve.  Now, finally, the customer's confusion and reaction to the introduction of an artisan pizza is a clear sign that they don't know what Domino's is either.

Wednesday, May 2, 2012

Artisan

Finally, someone else thinks marketers use of the word "Artisan" is just as absurd as I do.  Add it to the  list of meaningless buzzwords marketers use.

Tuesday, May 1, 2012

In Pour Taste?

The beer industry has a problem.  Sales for traditional names like Budweiser, Miller and their half-calorie siblings have been flat for a few years now - with brewers citing everything from the poor economy and unfavorable weather as reasons for their struggles.  Unable to fix such circumstances, brewers seem to be willing to try anything.

Anheuser-Busch has tried the line extensions strategy.  Bud Light an extension of Budweiser, now comes in lime, wheat and platinum varieties.  Budweiser also boasts a "select" variety which also has its their own extensions.

MillerCoors has tried to rally from its sales slump by innovating the package.  The Coors Light bottle has a label which green lights its drinker with a "Super Cold" signal.  They've also tried aluminum bottles, while over at Miller, they've introduced a "home draft" system, a "vortex" bottle and its latest creation, the "punch top can."

The new Miller punch top can innovation is supposedly preferable because "it's more like drinking from a pilsner glass," according to Amy Breeze, the Director of Innovation and Activation at Miller Lite.  The punch top can includes a special tab on the top of the can where the drinker can puncture a hole for air to flow through and give the drinker a better pour into their mouth.  If your wondering if you'll need a church key, the ads for the punch top can suggest that you won't - a drum stick will do fine supposedly.

Immediately, people wondered if Miller was taking innovation too far back to the frat house.  Is Miller promoting a more perfect device for the over-consumption of brewskies via shotgun?

Perhaps. But do we really think that the binge drinker residing in or partying in said frat house needs help in these social sciences.  Thus, I truly question to what degree the Miller Lite punch top can will change what is already happening and the things people will do.

Despite all of it's evils, the consumption of alcoholic beverages is a widely accepted part of American culture.  It's celebrated ritual of nearly every adult attended celebration and then some.  Does marketing have a significant role in creating and shaping cultures?  Absolutely.

Yet, marketing doesn't dictate to society as much as it suggests things.  Society should not act helpless to the will of marketing executives, it's not.  Perhaps the flat sales in the beer industry is evidence of this. 

In fact, society should be forcing the beer industry to discuss problems of conscience as well as problems of sales. Despite full comprehension that its products are regularly misused and the cause of many significant burdens to society; drunken driving, addiction and obesity among others, American breweries leave it in the consumers hands when they know that less 100 percent of them will be able to handle it.

What is their duty to society once their party stops?