Kit's Marketing Blog

As this is the last post, I want to end on a cheerful, happy note to finish the course off. So here it is, enjoy!

When Tamar talked about the mailing version of Kit Kat in Japan, I knew there were other versions of Kit Kats in Japan, and a quick google search showed that I wasn’t wrong… and check out the list on wikipedia!!

This makes me wonder how much money has been put into market research and internal lab research to discover these flavors and apply them tastefully to a Kit Kat bar. But however much cost that is, clearly, the revenue outweigh the costs because they are probably still looking for more flavors!

For those of you who do not follow the NBA, LeBron James is an extremely talented basketball player. He’s from Akron, Ohio and got drafted from High School into the Cleveland Cavaliers team. Ohio, for unknown reasons, have not been able to win championships in any sports. Some even call it a curse. When LeBron was drafted, the fact that he was born and raised in Ohio gave everyone much hope. In fact, LeBron even promised that his goal was to win a championship for Cleveland, and that he “won’t stop till I get it.”

Well, after seven years of trying and trying, LeBron stopped. This last summer, during the free agency period, he decided to sign with and play for the Miami Heat. The worst part was that he announced it in the last week of free agency, supposedly without any notice to his fans or his Cavaliers team.

Obviously, this sparked anger in the hearts of the people of Ohio and Cleveland. Jerseys were burned, spoofs of his commercials were made, and there was just so much hatred throughout the state.

This week, I was surfing on brandchannel.com again and came across this article: http://www.brandchannel.com/home/post/2010/11/22/LeBron-James.aspx which talked about LeBron James’ new line of furniture under the brand “Home Court by LeBron James.”

“The line is produced by American Signature, a furniture company based in Columbus, Ohio.” The furniture doesn’t look bad, but with as much anger as there is in Ohio, I honestly do not think these products would sell well.

Having said that, American Signature has 125 stores across the nation and in fact, the company has established quite a few stores in Florida, where LeBron James currently plays. However, I’m almost sure that sales would be extremely low in Ohio. Thus, it’s painful to think from American Signature’s standpoint about supply chain management and the logistics involved in managing a line of products that don’t sell well in the city where its headquarters is located. So was this a really bad move by American Signature?

No, they’re innocent: “The line…was arranged in a deal inked before LeBron’s free agent future was decided…”

I recently came across Maggie’s post about a cool Honda ad and gave the ad more thought. As cool as it may be, it doesn’t actually tell you that much about Honda’s Accord, except maybe for the fact that it works. Obviously, that wouldn’t be Honda’s sustainable competitive advantage, so what’s the point behind the ad?

Well, while I was watching the Honda ad, I thought about another ad:

This Doritos ad doesn’t even tell you anything about the product! However, it has 2.8 million views on youtube and I believe it was a very successful ad campaign. It was broadcasted during the superbowl in 2010, which meant a lot of people watched it on TV as well.

In both of these ads, it’s clear that the companies want to differentiate their ads from other ads. People are going to get bored watching another car ad that shows a slick vehicle driving through the empty, dark streets at midnight while the commentator talks about its style and fuel efficiency. Their ads needs to stand out.

After all, what did you get from the Honda ad and the Doritos ad? Most likely that they’re cool and awesome brands. Furthermore, for a low level of involvement and low risk good like Doritos, I don’t think people are going to spend a lot of time considering which brand to buy, which means the next time they step up to the chips aisle, they will see the bags of Doritos and link that to “keep your hands off my momma, keep your hands off my Doritos.”

I was recently surfing on brandchannel.com, which I think is a great site for following the latest news with brands, and came across this article: http://www.brandchannel.com/home/post/2010/11/03/Facebook-Mobile-Upgrade.aspx. The article talks about how “Facebook upgrades mobile with single sign-on, local deals.”

The new Single Sign-On (SSO) platform allows app developers to use add a button where users can choose to log on to Facebook and connect to the app’s services that way. However, instead of reaching a screen where you have to enter your e-mail address and your password, if you are already logged into Facebook on your mobile device, the app lets you automatically log in and skips the login page.

While some people may argue that this technology really only saved a few seconds and thus shouldn’t be considered anything too ground breaking, keep in mind we’re talking about mobile devices and nanotechnology: everything is made smaller, quicker and more efficient, and I do believe many users will appreciate saving those few seconds.

Here’s a tutorial video from the article explaining how to use the new SSO platform:

The other new Facebook feature is Facebook Deals. This feature, in essence, takes the promotional pricing (coupons and discounts) and mixes it with nanotechnology. Now, you can use your mobile device to log on to Facebook and pull out a coupon through Facebook, for the cafe/restaurant/store that you are currently in.

Here’s the promotional video for Facebook Deals from the article:

Why would store owners use Facebook deals? Let me pull out some key phrases from the video: “word-of-mouth marketing…generate awareness…build loyalty…”

Why would users use Facebook deals? Free discounts!!

So after reading through this article, I realized that Facebook is more engaged in promotion and product development than I expected (Post #6). Facebook continues to introduce stunning, new ideas to the world and allows businesses and users to both become part of a win-win situation. All of this could not have been accomplished without constant market research and market analysis.

In this post, I would like to discuss two interesting packaging ideas that I’ve recently came across.

1) Sanpellegrino Limonata

It’s a “sparkling lemon beverage with 16% lemon juice from concentrate [and] no preservatives added.” In my opinion, none of that would particularly attract customers. In fact, there are plenty of substitutes for beverages, but the Sanpellegrino Limonata does have an advantage over its competitors: it’s packaging.

If you’ve ever went to a convenience store or a cafe that sells this drink, you would recall scanning the fridge for the drink you want. You might look at the description of what it offers, the price, the color of the can and the brand, but in the end, the Sanpellegrino Limonata will stand out because of one thing: its foil cap. This thin piece of foil establishes prestige as it gives you the feeling and sensation of unwrapping the cap of a bottle of champagne or wine. Also, as my friend Will pointed out, the foil cap helps maintain the cleanliness of the top of the can, which may help attract consumers that are extra cautious of hygiene. Lastly, just the mere curiosity of why there’s a foil cap there would make you want to buy it and check it out/play with it.

Speaking of curiosity…

2) Stride Mystery Gum

There are a few things to note about this product. First of all, its best selling point is the fact that its a “mystery” flavor. Not only does this spark curiosity within the customer’s minds, but it also somewhat poses a challenge to the masses, asking them to try to identify the flavor. Next, notice how the packaging is extremely colorful. Compared to the other types of gum on the shelf (Extra, Excel, Wrigley’s 5, etc.), the packaging stands out. Furthermore, instead of printing the curvy “S” that most loyal consumers are accustomed to on the front of the package, the company decided to use a “?” that somewhat resembles the traditional “S,” but establishes something new as well. This twist in packaging may appeal to consumers and encourage them to purchase this product.

I believe that both of these products are doing quite well in terms of market share or sales because they both offer something out of the ordinary, some sort of selling point that competitors have yet to offer, and the creativity that triggered these ideas truly inspires me.

I was just staring at my can of Nestle’s Carnation Hot Chocolate and thought it sort of looked bulky. I believe they used to only have those in small, individual, one-time packets.

I can’t stop thinking that Nestle’s Carnation Hot Chocolate now feels cheaper to me because they’ve decided to sell it as a can of chocolate powder instead of multiple exquisite individual packages in a box. But perhaps it was a financially sound move; by selling in cans instead of packages, they could’ve reach the audience that always wanted 1 1/2 packs of powder in one cup of chocolate, or those who are environmentally friendly and hate the concept of individual packages. However, while I support the environmentally friendly and enjoy my chocolate with excess powder, I think the company has cheapened the brand through this move.

What if a luxury brand like Mercedes Benz was faced with a similar decision?

Let’s say, for whatever reason, Mercedes has been incurring slight losses every quarter. Recently, their marketing team has identified a segment of middle, middle-low income families that would love to own and drive a Mercedes car, but can only afford to pay the price of a medium tier vehicle. Should Mercedes go on and release a series that is cheaper in quality, and not as luxurious, but is very affordable? Will this affect their brand so much that the original, luxurious Mercedes series are affected? (Perhaps the richer bunch would not like to drive a brand that is associated with cheapness and low quality) Maybe they could try to create a new budget brand that is named Mercedes _______, but barely has any link to it? (This would cost a lot of money and effort though.)

What if this really happened? What would you do?

Well think about how many people are currently using Facebook. A lot. Is there an identifiable, reachable, substantial, responsive and profitable segmentation that Facebook hasn’t reached yet? Not that I can think of. Everyone uses Facebook right? In fact, Facebook, which started as a social networking site for college students to connect with each other, quickly expanded to a place where you can connect with your kindergarten friends, favorite celebrities, favorite sport stars, your parents and even your potential employers! So what is there left to do for Facebook’s marketing team? Does this mean Facebook doesn’t need to market itself anymore?

The answer is no. One point that people often overlook is that marketing involves interacting with businesses (B2B) as well. Facebook is not only for the college kids and the high schoolers and such, it’s for the app producers that wants Facebook users to play their game and for the companies that want to reach you and inform you of something through their ads. To think even further, Facebook could expand to develop some sort of social networking engine that could be sold for businesses to use privately: A company-wide Facebook. When that expansion happens, they’ll need marketing to attract companies and sell that service.

So while it might appear that Facebook has reached the end of its growth stage and therefore does not need marketing anymore, it’s not true! There is always room for…marketing!

So I was thinking, as we move into our second year, we realize the need to buy groceries because most of us cook our own meals nowadays. Although cooking at home is already significantly cheaper than eating out, we students as consumers are still looking to save money by buying the cheapest groceries available.

A quick analysis of the UBC area would show that there are two main places to get your groceries: Safeway and Save-on-Foods. I believe the price of groceries at these places are about the same. However, a handful of keen individuals choose to travel one hour to Costco’s in the downtown area.

Costco has the cheapest groceries. As one of my roommates noted, the price of ground beef at Costco is half of that at Save-on-Foods. Having known this, I thought about the possibility of Costco creating a branch around UBC…will it work?

Well first of all, will they be able to get a substantial amount of consumers? Some would say no, as UBC does not contain as much people and as much “human traffic” as the downtown area. But consider the fact that UBC is on the very west corner of Vancouver. Chances are, students will only go to Costco to buy their groceries. Through this, Costco could perhaps develop some loyal customers too.

So what about the membership card requirement? Wouldn’t some students see that and decide to go to Safeway or Save-on-Foods instead? Well if the price of the membership/time it takes to register one is a major negative influence in the consumer’s decision to shop at Costco, then start with a special student service. Or perhaps launch a new brand of Costco, called Costco Student or something.

If the warehouse is proving to be too big, then make it smaller and try to only offer the best selling products. If the land is too expensive, perhaps try to work out a deal with UBC to subsidize it. There will be ways around the small problems, and the way I see it, Costco can earn a lot of money from the students of UBC.

So maybe they should do it? 🙂

Recently, I came across this post: https://blogs.ubc.ca/anawint/2010/10/05/the-power-of-data-mining/

The latter paragraph described the power of data-mining through Budweiser’s release of BBQ sauce. I would first like to agree with Anawin in saying that thorough market research and data-mining has indeed been done before the release of this BBQ sauce, but I would also like to elaborate on this product in my post.

As we are talking about segmentation, targeting and positioning, I would like to ask all readers: how far is too far? Budweiser, who is famous for its beer, is now releasing a BBQ sauce. Sure, people have beer while having BBQ chicken wings, but I don’t understand what drove the thought behind the release.

Is this too far of a leap outside of Budweiser’s main segmentation? For example, I would understand if Budweiser launched a new type of beer targeted towards ladies or older consumers, but to enter a completely different market of consumer goods? That’s like, Ritz launching a new line of wine, to have with its cheese crackers; it just feels odd.

However, last time I checked, the sauce is still on the shelves and online reviews are mixed. Perhaps they found a gem of unsatisfied consumers who want a type of BBQ sauce that only Budweiser can produce or perhaps people are just that brand loyal. Whatever it is, while I congratulate Budweiser for its daring step, it truly confuses me that such product was released.