The battle of the sodas.

I was reading Marketing Mag again, and another article caught my eye.

Coke vs. Pepsi.

We’ve always known the two soft drink powerhouses to be the first and second, but just recently, a change in the the US market has put both Coke, and now Diet Coke ahead of Pepsi.

AdAge, another of my favourite blogs also had a similar article.

Both Marketing Mag and AdAge questioned whether it was a smart move by Pepsi to suddenly drop from the loop of Super Bowl commercials this year. Instead, they chose to give $20 billion in grants to consumers as opposed to spending it on celebrity endorsements in the new Refresh Project. I personally had an encounter with the project since a friend of mine was working the promotion. In short, students were asked “what do you care about?” and then had the opportunity to take a picture, proudly holding their idea written on a whiteboard in front of a select background of their choice.

I must be perfectly honest, this push promotion strategy seemed to work at the time, and I was intrigued with the concept behind the project. But since the picture, I have forgotten about the project until now (that was in Oct.) and the picture is probably buried under some marketing notes in my room. In fact, when I think Pepsi, I think about this commercial:

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and not the project.

So perhaps a funny commercial with a well-known celebrity is a lot more long lasting? Especially since only a select few will have their Refresh ideas granted, as opposed to using a celebrity in a pull promotion.

Coke, the long leader seems to do this well. With a well-known product placement in popular reality singing competition – American Idol and its long-time sponsorship of the Olympics since 1928!

Has BMO gone too far off the road?

My MasterCard statement came in the mail today, and after the usual glance of wondering when I had time to rack up the charges, I was about to toss it aside until the second page of my statement caught my eye:

I trust my MasterCard with BMO, and if I wasn’t a loyal TD customer, I’d trust BMO to do my banking as well. But my car? Roadside assistance seems like a brand extension that’s gone further off the road than a flat tire could take me.

But to give it a fair chance, I decided to dig into the details. Currently a BCAA member, I decided to compare the two to see if I was missing out. I compiled a side-by-side comparison of the two basic packages:

The two basic packages offer almost identical services. 4 calls per year, BMO offers 10km maximum of towing, while BCAA offers 5km free or to the closest garage. The only difference? Pricing. The objective of BMO’s pricing is heavily sales orientated. They offer a low price of $69 per year (compared to BCAA’s $87.25) in order attract customers and increase sales. This is an excellent example of strategic penetration planning – trying to establish a solid customer base in order to sustain long-term market share.

On the contrary,  BCAA is able to focus on profit orientation. Because of its already established brand reputation, it can focus on prestige pricing and offering products at higher prices as a reflection of their higher value.

It’s a little to early to tell if BMO will be successful. However, was this diversification the right step? Or should their brand extension have led to a different path?

On that note, my friend Kevin has an entertaining entry on brand extension fails to keep your mind rolling.