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Promoting Products April 30, 2007

Posted by Stephanie in advertising, brand, Consumers.
7 comments

The effort companies go through to advertise in both subtle and obvious ways on television is remarkable.  Characters in movies and television shows are often depicted with very specific brands of beverages, clothes and other products.  Products are strategically placed in the background of scenes, carefully positioned to subconsciously attract a viewer’s attention.  Another strategy is through the endorsements of talk show hosts.  Oprah has her “Favorite Things” episode about once a year which hopefully stemmed from her actual favorite finds.  Now however, hosts like Oprah and Martha Stewart look to make some extra money (as if either needed it) by promoting products on their shows. 

 
30-second spot on The Martha Stewart Show = $10,000

One-time in-show oral mention with product close-up = $100,000

Two-minute-plus branded segment, with two or three talking points = $250,000 +

 (Data: Martha Stewart Living Omnimedia Inc., BusinessWeek)

  In some cases Martha has never even used the product herself and yet she boosts of how phenomenal it is.  Even worse, in the case of the Scotch-Brite toilet scrubber segment, Martha doesn’t even like the fact that the product is used once and then wastefully thrown away.  This reminds me of hair product commercials featuring celebrities.  Do any of those women actually dye their hair from a box?  I highly doubt so. 

 Is this the same as false advertising? It seems quite deceitful.  Yet thousand, maybe millions of viewers take the advice of the “Queen of the Product Pitch.”  On whose recommendation would you purchase a new product?  Do they have to be an “expert” in their field? Is a simple commercial not enough anymore?

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Starbucks, not so evil. April 5, 2007

Posted by Jordi in allances, brand.
3 comments

They are on list of best 500 employers…

They deal with fair trade coffee.

Global Exchange has had some success.

In 2000, a campaign by thousands of activists across the country pressured Starbucks to carry Fair Trade coffee in all their cafes. See press release and detailed history for more information. As a result, on October 4 Starbucks introduced whole bean Fair Trade Certified coffee at over 2,300 stores, which brought the number of Fair Trade outlets to almost 5,000 nationwide (it’s currently over 7,500).

A Saab’s Story March 27, 2007

Posted by Kira in Auto's, brand, Consumers, Marketing, Organizational Environment, outsourcing, Retail.
4 comments

Saab was faced with the challenge of expanding its market to mid-size sports wagon drivers in the U.K. To accomplish this, Saab had to overcome two major disadvantages. Not only was their marketing budget smaller than their competitors but, their brand recognition and reputation was smaller as well. To promote the 9-3 SportWagon, Saab created a two-part campaign that combined direct mail and the internet. The campaign was a game called “The Race Against Time.” This campaign included a 100-page “choose your own adventure” book that was mailed to people who inquired about the car. The book put its readers in a Saab 9-3 and dared them to see if they could reach a weekend destination without falling into trouble. The story moved forward by choosing from optional actions listed on each page which all led to a different set of circumstances. The game was also offered online- so people could sign up for the game and for additional information about Saab. By playing online, the players could e-mail their results to a friend and challenge them to beat their time. Participants could also record their personal progress. As an incentive, participants who won the challenges were eligible to win a Saab 9-3 Aero V6 SportWagon and Saab-branded sports merchandise. Although Saab officials assumed that no more than 5,000 people would participate in the campaign, more than 29,000 people signed up to play online with 40% also signing up to receive electronic news updates from Saab. The game was also placed on other websites and on blogs (go figure!). Sales for the 9-3 rose in Great Britain from 2,000 cars sold in 2005 to more than 6,000 in 2006.

“We got a set of people who never would have considered Saab,” says Ed Birth, the Saab account manager for Draftfcb (Draftfcb created the campaign)

Saab’s campaign is an example of a recent trend in which marketers are targeting consumers enticing them to play games and activities in order to get them to spend more time with the brands. The longer the time spent with the product the more likely the brand will come to mind when making a future purchase.

Last class we were discussing survival strategies. I would say that Saab is a k-specialist- they had to break into an established market for sport wagons. Some of the reasons that Saab was probably successful as a k-specialist were because they already knew that a market for sport wagons in the U.K. existed and that games and activities were a marketing success. They were able to see trends in the existing companies in the sport wagon market that they could “mimic” and allowed them to see the correct way they could compete.

By using direct mail, online websites, and blogs, Saab was able to reach different potential consumers. The use of online websites allowed Saab to capture younger consumers while also capturing the names and e-mail addresses of potential consumers who registered. This could allow Saab to generate a database for future marketing tactics. Also, the game was a great way to tap into consumers’ emotions- I know it made me reminisce about the “Choose Your Own Adventure” book that I had when I was younger!

 

I think the game can still be played online- check it out for yourself!

Can YouTube resist organizational change? March 19, 2007

Posted by Lady in brand, Consumers, Internet, monopoly, Organizational Environment, sustainable development.
3 comments

I recently read an article entitled, “YouTube struggles despite dominance” which discussed how YouTube is struggling to compete for the business of media companies even after the fact that they were recently acquired by Google.  YouTube’s inability to prevent unauthorized uploads has caused them to lose potential deals with prominent media companies such as Viacom. In addition, some media companies such as Viacom were not pleased with the way YouTube attempted to seal a deal because they felt as though YouTube did not display “respect for their content.”

Analysts have different opinions of what this problem would do for the future of YouTube. Some analysts believe that YouTube needs to make a change in order to build long-lasting relationships with some of these media companies. They believe that they need to adopt new technology to prevent unauthorized uploads and also establish trust with these media companies by protecting the media companies’ copyright terms. Without making some necessary changes, these analysts believe that YouTube will eventually lose out to its’ competitors such as iFilm and Revver. Other analysts believe that YouTube can easily obtain deals with media companies just because of their brand name. These analysts do not believe that competition is a big threat to YouTube.

I chose this article because it shows the existence of some forces of organizational change within YouTube. They may need to do some things differently in order to continue to compete for business with these media companies. What are the forces of change? Well the obvious one is competitive forces since media companies can seek service from competitors such as iFilm and Revver. Might there be social forces working against YouTube because of the increased demand for established trust with these media companies and demand for software that would protect the media company’s content? I believe so.

Does YouTube need to give in to these forces of changes? Or does YouTube have enough bargaining power to resist these forces? Might their strategy of being the most dominant and popular free video sharing website allow them to resist making the changes that these media companies prefer? I believe that this may be the case in the short run. However, I believe that it will not be sustainable once YouTube’s competitors become more popular and trusted by these media companies.

Apple’s i phone March 19, 2007

Posted by Charley S in brand, innovation, Technology.
4 comments

http://www.time.com/time/magazine/article/0,9171,1576854,00.html

This article discusses how apple’s new phone can potentially revolutionize the cell phone industry.  The biggest change is the new touch screen technology that is being used to work the entire phone.  Basically, you have an i pod sized device but instead of a screen and a wheel there is a giant, color touch screen.  You work the entire phone including email, texting, phone, camera and Internet with the touch screen that is much brighter and more durable than similar technology in use today.  In addition to this change, the Internet will now be the actual Internet instead of dumbed down cell phone Internet and text messages will be displayed in bubbles on the screen in an easy to access system.  The biggest downside: a minimum $400 price tag and a 2 year comittment to cingular.  This may be the future of phones but it’s going to be awhile before I get motivated enough to buy one.

Apple’s strategy in this area parallels the way they entered the mp3 player market: instead of pioneering the way with innovation they just take the existing technology, notice the problems and fix them.  With i pods apple noticed the problem of mp3 players being unwieldy to use with the computer and bad aesthetic design.  i pods improved with the introduction of i tunes on practically every computer and making them pleasing to the eye.  The strategy that apple is pursuing with phones is the same.  Apple let the phone companies clear the path with innovation and is now fixing the mistakes in the phones.  In addition to fixing technological flaws, apple has a hip image with the public and young consumers will be very likely to spend money on this product.  Only time can tell if apple can make it in this cutthroat industry, but even 1% of the phone industry is worth billions of dollars and can be extremely profitable for apple. 

If I had the Money I would Buy Chrysler March 6, 2007

Posted by K.C. in Auto's, brand, Manufacturing, Merger.
3 comments

Recently at the Geneva Motor Show, DaimlerChrysler chief executive, Dieter Zetsche discussed speculations about dumping Chrysler. While he did not give too many details, he did discus how if Daimler were to sell Chrysler, they would sell the company as whole and not break up its brands. Chrysler has a highly integrated production system that allows it to manufacture different brands of automobiles using similar platforms and parts. Therefore, if Daimler were to sell Chrysler, they would not sell its brands individually as many Chrysler badge cars use the same chassis as Jeep and Dodge vehicles.

Chrysler Group is very integrated,” – Dieter Zetsche

In addition, many new Chrysler vehicles use Mercedes parts and pieces, which may create a problem for the brand if Daimler does decide to sell them. The Chrysler Crossfire uses almost 70% of its parts from Mercedes vehicles and if Daimler were to drop them, Chrysler would need to find another manufacturing source.

In the past few years, DaimlerChrysler has tried to differentiate the Chrysler brands and focus on establishing its three brands as unique brands. Ford on the other hand is facing issues with brand differentiation because many of its Ford badge models look almost identical to its Mercury and
Lincoln brand models. In my opinion, I think Chrysler remains an attractive automotive unit because they have been able to produce cars that have appealed more than many other American brands. Even with a loss of $1.5 billion last year, Chrysler has been able to increase its global sales 15 percent outside of North America this past year.

 

Industry analysts argue that private equity investors would be the most likely buyer of the brand and if this does occur, Chrysler may be forced to drastically reduce its operations.

A “watered down” Starbucks February 25, 2007

Posted by Stacey Swift in brand, Retail.
9 comments

Everyone knows and loves Starbucks. Its comforting to know that in most places, not Lewisburg, PA, you know you can get a great Starbucks cup of coffee, late, cappachino, etc. about every few blocks. I was just talking to my friend from Portland, she told me that in their large 5 story mall there are 2 Starbucks on each floor! Thats 10 in one building! I know I have 3 in my mall, I also have one in my grocery store at home, as well as a free standing Starbucks right next to my grocery store! Isn’t this a bit excessive?

“In order to achieve the growth, development and scale necessary to go from less than 1,000 stores to 13,000 stores and beyond, we have had to make a series of decisions that, in retrospect, have lead to the watering down of the Starbucks experience, and, what some might call the commoditization of our brand,” Howard Schultz.

Schultz now believes this rapid growth “watered down their iconic brand.” Does Starbucks still retain its strong brand name or has it just become run of the mill coffee? I know I love Starbucks coffee, and since I cannot enjoy a steamy cup here in lburg I look forward to Starbucks when I go home. That being said, I do believe the vast number of stores throughout the nation has commodizied the brand. The article mentions their cookie-cutter design of their stores. Starbucks are great, but they are all the same. This past summer I studied abroad in Europe, and I grew to love the small local cafes where you could get a great cup of coffee and enjoy a unique atmosphere. Each cafe was different and great. Now I have come enjoy smaller coffee shops, such as Zeldas. I agree that quantity of Starbucks stores has jaded people. The article mentioned the cookie-cutter stores, so I immediately thought, what about franchising Starbucks? I looked it up and Starbucks does not franchise to individuals. Do you think franchising could help this problem? I think it could help them get away from the monontonous store layouts. It would make each store a little different and they could cater towards local tastes like McDonalds does.

Do you think the Starbucks brand has been watered down? What can they do to improve their brand name? Should they franchise?