In the marketing assignment, my group decided to focus on Zara.

I appreciated the structure of the assignment, as it was split into three parts  based on the materials we have learned in class. As opposed to one big assignment, being able apply marketing concepts (consumer behaviour, processes, CDSTEP analysis) as we learn is very effective. Our team meetings were also more productive since the concepts not clouded, but fresh on our minds.  

Upon researching Zara, I am very appreciative of the resources compiled on the COMM 296 website. It is important research beyond links from Google to find credible, strong sources to support recommendations.  The most useful websites I have come across are Business Source Complete and Factiva.

The video component of the assignment was a great learning experience. I feel that being able to create a multimedia presentation is valuable skill to have. One of challenges of this video project is the creative component and being able to be creative without sacrificing the value of the content. Extensive preparation before the actual filming made the filming very organized and efficient as we had written our script already. Presenting our recommendations through a  “Sauder news” TV clip was hard, given that we didn’t have the ideal location.

If I were to do this project the second time around, a more effective presentation would be to include more “in the action” and “realistic on the scene” examples.  I would want to incorporate a story in the presentation to engage the audience. Using more visual effects (scene transition, editing) would make the video more interesting.

Knowing that there was a peer review component, I felt motivated to produce something that has high quality detailed information presented creatively. Peer feedback is very helpful especially since we are new to using such technology. 

Tying in my previous post about social media content marketing and as we talk about promotion in class, I have came across this blog post from Canadian Marketing Association about the importance of transparency in social media.  In a recent study, they have asked people to what extent they trust certain forms of advertising, list includes from people you know, TV advertisements, branded websites, etc. People’s trust on advertisements has increased, and I feel that marketers should not take advantage of this. There is a fine line in unethical marketing, so companies must be wary. Companies can increase their transparency in many ways. For example, McDonalds strives to be more transparent about their food through launching videos that shows the process of arranging perfectly placed big macs consumers see on their advertisements. For example, they justified the nicer looking big macs on advertising with the amount of time spent on each preparation, 60 seconds versus 4 hours.

Being transparent can clear up any controversy, as well as help companies adopt an integrated marketing communication (IMC) process. McDonald’s “Our food. Your Question” marketing tactic shows initiative, a sense of responsibility.

Their (the sender) promotion involves getting the right message, to the right people, at the right time. The medium of communication (communication channel), which is the website  is for people who are either interested, curious or concerned (the receiver) about what’s in McDonald’s products. Being able to directly question (decoding) McDonald’s tears that a barrier that could stimulate trust from consumers clear up misconceptions (noise), and change their attitude and behaviour. Those who were skeptical about purchasing their products may be less reluctant. This campaign is an excellent way for McDonalds to get feedback and response about their products (feedback loop). 

Sources:

http://yourquestions.mcdonalds.ca/questions/4874

http://www.the-cma.org/about/blog/why-transparency-is-important-on-social-media

http://www.businessweek.com/articles/2012-05-10/integrated-marketing-if-you-knew-it-youd-do-it

We are currently living  in an age of multitasking, and technology has made it easy to do that. All sorts of products are advertised through social media. As we are juggling with countless things to do, it makes sense that sometimes, the small messages are the most effective. Personally, advertising with something short and sweet would catch my attention over a 2 page long email about some product.  In the case of Taco Bell, they incorporated  the public into their marketing campaign through starting humorous short “conversations” on Twitter. For example,

Taco Bell’s humorous response through twitter has increased the sale of Dorito Loco Tacos They are also the first to use SnapChat (a mobile app that allows users to send pictures or videos for 10 seconds) as a medium of advertising. Other companies are also embracing social media. Rebecca Minkoff has also been sending 10 second previews of their latest fashion trends through SnapChat. 

All of this brings back to how businesses can get the most exposure consumer habits. These are examples of content marketing, which has the purpose of attracting customer with valuable information with the intention to change or enhance their consumer behaviour. In the case of Taco Bell, instead of giving the impression of trying to sell the product, they have delivered the information. As mentioned in class, consumer behaviour and attitude can be changed in several ways.  Being humorous is a way to connect with customers at a personal basis. My question is, since social media is always changing, can social media content marketing help retain and create loyal customers after the hype is gone?

Sources:

http://www.entrepreneur.com/article/229806

http://www.buzzfeed.com/daves4/the-best-of-taco-bells-twitter

Advertisements influence  consumer behaviour. In class, we talked about how different brands of bottled water,  a good that is available for free, is differentiated. Evian water was recommended as  as the best water for babies, first introduced in 1935 in France. Until now, they have remained the number one brand water used by mother for babies.

They have taken creative approaches to stay true to its brand history.  In turn, they are able to differentiate their product from other water bottle brands.

The baby campaign was first introduced in 1998 as the Water Babies.

https://www.youtube.com/watch?v=lCOcjWG6Ykc

And then, a decade later, the Roller Babies

https://www.youtube.com/watch?v=XQcVllWpwGs

More recently, the Baby & Me campaign was launched.

https://www.youtube.com/watch?v=pfxB5ut-KTs

and also, the Baby Inside

https://www.youtube.com/watch?v=Vg1jAWtWUaU

These advertisements embraces the “Drink pure and natural, Live Young” slogan through a reflection of grown people as dancing babies. The campaign focuses on Evian’s  commitment to the Live Young lifestyle message: “youth is not a matter of age, it’s an attitude.”

These ad taps into several attitudes, including the affective component because the ad may have sparked a new emotion that Evian water is pure and youthful, which can engage in buyers buying the product. As one of the most watched youtube videos, the commercial has not failed to catch people’s attention.

The campaign is a great example of how Evian promotes the goodness of the product by using babies as a leverage to symbolize youth and purity.

Sources

http://www.adweek.com/news-gallery/advertising-branding/10-most-viral-ads-2013-so-far-149832#google-how-it-feels-through-glass-10

http://www.mediabistro.com/alltwitter/evianbabyandme_b43913

http://www.adweek.com/news/advertising-branding/ad-day-evian-148706

In Jeffrey’s blog post, he discussed Minute Maid’s goal to bring the brand to a more comp temporary place expand its target market in order to combat the risk of facing the decline stage of the product life cycle  through advertisements.

By launching campaigns such as “Wake Up Your MMOJO,” they are trying to seek growth of their existing product by tapping into a new market segment that consist of men and younger people (market development). The advertisement features a man drinking minute maid in its newly transformed single-serve bottles, from previously half-gallon cartons.

Apart from advertisements, Minute Maid has also redesigned their packaging and brand graphics to single-serve bottles, which accounted for more than 24% increase in sales. At a consumer level, packaging their product in a way that is convenient to consumers can alter their perception of the product. The consumers looked down on the half gallon cartons displayed in “coffin-style.” This can also help retailers position their product in a more attractive aisle in the supermarket, a place that is visible from the top. Minute Maid conducted marketing research through focus groups revealed that individuals loved the lavish photomontage of fresh sliced oranges and apples in the bottle’s plastic wraps which makes the product more dependent and identifiable. It worked within its constraints of packaging the product in cans, as the printing the graphics would have been a challenge. Changing its packaging makes it more accessible to young health-consious consumers, who are the main purchasers of single-serve juice sold in bottles and cans.

https://www.youtube.com/watch?v=j5FfGNedXoM

Not only is Minute Maid trying increase consumer consumption as Jeffrey mentioned, the company ultimately want to be sustainable and create value by increasing brand equity through the marketing tactics mentioned above.

Sources 

http://www.fastcompany.com/1458943/first-look-coke-juices-its-minutemaid-packaging

https://blogs.ubc.ca/jlushao/2013/10/21/blog-3-willcan-minute-maid-expand-orange-juice-beyond-its-original-consumers/

The Hermès Birkin, one of the most in-demand bags in the world has been way ahead of its competitors in terms of status and craftsmanship. Costs from $7000-$10,000, these handmade bags are made of calf leather, ostrich, crocodile and lizard, and take around 15-20 hours to produce. They also have high variable costs because it craftsman takes three years of training to master this bag. They are released infrequently and unpredictably which adopts the model of scarcity. Often times, the wait to purchase a Birkin can be more than a year.

Despite the fluctuating economy, the price of Hermès handbags definitely has not changed. Its strengths root from the perceived value created through their pricing strategy and limited quantities. Hermès’ company objective has employed a customer orientation and grasped the consumer’s reaction to different prices, as customers believe that purchasing a Birkin is an investment, not an expense. Similarly, prestige products such as the Birkin does not follow traditional demand model, which is demand increases as price decreases. Their pricing strategy aligns with its company objective, which is to preserve the heritage and quality. Customers who buy the Birkin purchase for their status rather than functionality. The exclusivity of the product makes it more desirable because fewer people can afford to purchase it.

A problem that Hermès might run into in the future with this pricing strategy is the risk of devaluing their brand if they decrease the price. For example, growth slowdown may urge the company to satisfy shareholder’s interest by increasing the number of sales and expanding the manufacturing. In turn, the product may lose its premier position. The challenge would be; how can Hermès increase the quantity of bags sold by being more assesible without losing value?

Sources:

http://insidefmm.com/2009/11/hermes-marketing-never-discount-hermes-birkin-kelly-handbags/

http://www.bnn.ca/News/2013/10/2/BLOG-Hermes-Birkin-The-most-in-demand-bag-in-the-world.aspx

http://www.bloomberg.com/news/2013-02-10/hermes-10-000-birkin-purse-seen-leading-to-record-sales-retail.html

http://www.hermes.com/index-ca-en.html

Tesla Motors, founded in 2003 by a group of Sillicon Valley engineers, is company that designs, manufactures and sells electric cars and electric power train components. It currently has 37 stores located primarily in North America. Some of their innovative products include the Tesla Roadster, the first battery electric sports car, and Model S.

This fast-growing company went public on 2010 and is looking to launch its next product: Model X.

The product life cycle of Model S is arguably in the growth stage. The Model S has become the bestselling electric vehicle in America. They are in the growth stage because electric vehicles are more accepted and sales are rising.

The new segment of consumers who are interested in purchasing electric vehicles  is on the rise. As electric vehicles become a norm, Tesla can further promote their products to a larger customer base.  Tesla has plans to expand production and increase distribution to meet the increasing demand in Europe and Asia. It expects to reach an annual production rate of 40,000 by late next year as it starts selling in Europe and Asia.

Product quality of Model S is maintained, for example, it was rated the safest car by NHTSA.  Its advantage lies within the lack of gas tank, which creates a much longer crumple zone to absorb a high speed impact. With a starting price of 70,000, Tesla Motor’s product pricing is maintained as the company enjoys increasing demand with little competition.

I believe Tesla’s growth will only rise from here on, as the electric vehicle industry will only continue to expand. As of now, I cannot imagine Tesla products reaching a maturity stage, as there are many untapped markets outside of North America.

Sources

http://www.teslamotors.com/en_CA/

http://www.teslamotors.com/fr_FR/about/press/releases/tesla-model-s-sales-exceed-target

Zara has become one of the most well-known fashion brands in the world. It began operations in 1975 and now earns 70% of the Inditex group revenues. Since increasing international operations in 1988, Zara has opened nearly 1800 stores in 45 countries worldwide.

Apart from its quick response to customer demands through speedy supply chain response, much of its brand value is created through its marketing strategy. Zara only spends 0.3 percent of sales on marketing, compared to other retailers who spend 3-4 percent. Zara markets through the appeal, location, and placement of stores. For example, Zara aims to be close to the high fashion stores such as Gucci and Prada.

I think Zara’s strategy has been very successful thus far, however, using  “flashy” advertisements as competitors do may further increase their sales and brand exposure. Its major competitor, markets through using high profile designer name designs and endorsements of celebrities such as Beyonce.

In my perspective, Zara has already established a strong customer base, and there is no doubt that if they employ the same sort of marketing strategy, there is more to gain than lose. They are able to “get by” for now, but if they want to further expand, they should consider employing a more rigorous marketing strategy. The real challenge is; how will Zara amend  their marketing strategy while still   keeping their aura of “exclusivity?”

Sources

http://search.proquest.com.ezproxy.library.ubc.ca/docview/1432516684?accountid=14656

http://web.mit.edu/jgallien/www/ZaraInterfaces2010.pdf

http://www.uniquebusinessstrategies.co.uk/pdfs/case%20studies/zarathespeedingbullet.pdf

As I was thinking of all the brands that I associate with, I realize that more than half of those them originate from one country. It is obvious some of the most powerful brands in the world is created in America, but how do these brands become so influential and popular? Apple, Microsoft, IBM, Google, and Intel are all American brands that are deemed 2012’s “World’s Most Powerful Brand” by Forbes. What makes a brand valuable? Is there a difference between a valuable brand and a powerful brand?

All the company listed have high brand equity, however, there is no universal accepted way to measure it.  Forbes’ methodology is based on financial metrics and indexed consumer behaviour and brand value.

In my opinion, different people have different value on certain brands. In a micro perspective, as an avid yogi, Lululemon is deemed a valuable brand to me, however other people may think otherwise. Brand equity can also be measured as the price premium that a brand demands over a generic product. A powerful brand should never fail to capture the world’s attention. I think that powerful brands are valuable, but valuable brands does not necessarily have to be powerful. For example, those who shop at Whole Foods value the brand because they believe in paying price premium for organic foods, but not everyone has the same mentality. I deduce that powerful brand should be stellar in financial strength and consumer perception.

On a side note, even as globalization prevails, many top companies on the list are American. Globalization might as well be “americanization.”

Sources:

http://www.forbes.com/powerful-brands/list/

http://www.forbes.com/sites/kurtbadenhausen/2012/10/02/apple-tops-list-of-the-worlds-most-powerful-brands/

http://www.netmba.com/marketing/brand/equity/

Abercrombie and Fitch, an American retailer that targets the youth market, stirs up contraversy when they refused to offer their clothes larger than women’s size 10 and men’s size 34. In response to this, CEO Mike Jeffries said that

“We go after the cool kids. We go after the attractive, all-American kid with a great attitude and a lot of friends. A lot of people don’t belong [in our clothes], and they can’t belong. Are we exclusionary? Absolutely.”

They have created a brand image that revolves around aesthetics and encourages sexual attraction. A&F marketing is heavily based on the employees that work in the store. The fact that only skinny, attractive “models” works in their store enforces A&F’s exclusion of large women. .

This is unethical because targeting only people that are currently praised in society furthers mental illnesses, unhealthy lifestyle, and body image issues. Their marketing does not only impact youths as a whole, but also parents may feel less inclined to purchase from A&F. A&F should be ashamed as they cultivate a culture that does not promote equality.

Sources:

http://www.theguardian.com/media-network/media-network-blog/2013/may/16/abercrombie-fitch-marketing-mike-jeffries

http://www.businessinsider.com/abercrombie-and-fitch-worst-controversies-2013-8?op=1

http://www.cnn.com/2013/05/23/living/abercrombie-attractive-and-fat/index.html

http://www.forbes.com/sites/rogerdooley/2013/05/16/abercrombie-ceo/