Is ‘Proprietary Housebrand’ an oxymoron?

Is ‘Proprietary Housebrand’ an oxymoron?

Oct 4, 2016 | Branding, Marketing, retail

Is this range of McWilliams wines a housebrand or not?

it is exclusive to Dan Murpy’s, so ‘yes’, but it is a proprietary brand, so ‘no’. At the very least, the trading terms conversations would have been interesting.

It is also claimed to be an ‘Innovation’ which redefines my understanding of what that word means. Housebrands do not innovate, they copy, some may say act as a parasite on the innovation activities of proprietary brands.  Product innovation is one of the two key competitive options (the other being the opportunity to now connect with their consumers digitally) available to FMCG suppliers by which they can differentiate their products from their housebrand competition. Supermarket chains have done well squeezing costs out of their supply chains with process innovation, usually to the cost of their suppliers, incapable to this point to be effective with product innovation.

Exclusivity has always been a demand of retailers, difficult in Australia with just the two of them having such overwhelming dominance, but in unbranded categories like produce, they have successfully developed strongly preferential supply arrangements. But wine? one of the most brand sensitive categories around?

From  Woolies owned Dan Murphy’s I got the above offer the other day for an exclusive to Dans branded McWilliams Bagtown range, from the Griffith area. All the hyperbolic language and story telling that goes with the wine category, but an exclusive range to Dans. it seems Woolies have started something I have not seen before in Australia that has the potential for wider use. For years in Hong Kong, you dealt with one or the other of the two major FMCG retailers, but not both. Problem here with that strategy is that there are only 24 million of us, and widely scattered so the twisted economics and trading term requirements surrounding proprietary branded retail chain distribution have simply not allowed a similar development here. Till now?

The McWilliams sales manager will be having an interesting conversation with the Liquorland buyer the next time he visits, although it is reasonable to expect he will get a phone call, and probably lose either some distribution or a promotional slot, or something that reflects that McWilliams have crossed a line, and Liquorland will not be left out.

As an aside, the Dan Murphy’s 90 point label badge borders on the dodgy. You can expect a 90 point wine (Silver medal) judged at one of the major shows to be pretty good, warranting a place in any cellar. The wine in this case might be OK, but it has not been judged by anyone outside Dans staff, and they are unlikely to tell the boss that his choice sucked. Griffith is not known for its cabernet, the climate is all wrong for the grape variety, and the few I have tried were well short of 90 points. Hopefully this one is an exception.

6 strategies to build a brand on a shoestring

6 strategies to build a brand on a shoestring

Aug 15, 2016 | Branding, Small business

Small businesses everywhere suffer from the unequal access to the marketing funding they have compared to their larger competitors. Some complain about it, others get on and short circuit the system by turning it on its head.

Large companies overrun  with so called marketers do things in a pretty standard sequence.

Advertise to build awareness,

Generate some customer trial,

Build on trial for repeat purchase.

Small businesses need to find a way to get people to trial their product without all the mass advertising, they need to be able to target their ideal customer specifically, without the investment of mass media, and these days, paid social media which has replaced much of the mass media, but still needs to be managed.

Following are 5 strategies that have worked for my clients, often in tandem.

Sampling. 

If for example, you run a restaurant, stand outside at lunchtime and give samples of your signature dish to passers  by who match the profile of your ideal customer. Don’t waste money on advertising in the local paper, or sponsoring the local footie team (although that may be a good thing to do for other reasons)

Amazon allows you to sample the books on their lists in a number of ways. You can look inside most books, typically you are shown the contents page and often the first chapter. Sometimes you can download a sample chapter, and from time to time there are deals for a limited time on one book in a series, and of course there are the recommendations tailored on your search and purchase history, and reader reviews. All sampling.

Meadow Lea, a brand icon built through the late 70’s and into the eighties had a hugely effective media persona, ‘You ought to be congratulated’, but was supported with an extensive program of sampling in supermarkets that continued for   many years. Getting consumers to sample the product on a bit of bread in store, where the purchases are made was a hugely effective, but low key, slow burn, strategy

Identify your ideal customer.

Identify the most profitable market, by identifying your ideal customer, not just the ones who say they like you, but those who put their money where their mouth is. It amazes me how often a target market turns out to be other than the most profitable market when you do some data digging.

If you are an architect, the most profitable market is unlikely to be first home  buyers, far more likely to be successful 40 plus professionals. They might be harder to find, and sell, but way more likely to be able to spend the necessary money to get what they want.

Differentiate yourself.

Create some sort of differentiation that has some emotional component, so it is likely to be something personal.

I drive an old Mercedes, love it to bits. Whenever it gets a service, the car comes back cleaned, not something I ask for or pay for, (at least not directly) but very nice. Last time I picked it up after a service, there was also a matchbox car of the same model as mine, and a note “for your new grandson” on the passenger seat. In casual conversation when I dropped the car off, I had shown a picture of my new grandson. Think anyone else would ever get to service my Merc?, probably cost them 10 bucks for the toy to ensure I never went anywhere else.

Use direct response techniques.

Direct response advertising provides a huge portfolio of ideas and techniques to learn from, and from long experience, we know direct response works. Even after social media has destroyed much of the advertising industry as we knew it a few years ago, direct response has adapted and thrived. Virtually every offer you receive in your inbox has been crafted with the disciplines of direct response that originated and were refined in the back half of the 20th century. Always have a call to action in an ad, an email, or piece of copy if the reader does not know what to do next, they will wander off.

Direct response advertising is absolutely  and immediately measurable, you know what you get, and can test varying treatments, so being able to calculate an ROI on your investment is now a reality.

Create or highlight a problem, then solve it with your product.

Purchases are made for a reason, and while  the reasons vary from the rational response to a problem, to the emotional solution to an imagined one, the rules are the same. If your product can deliver the solution better  than the alternatives, you will be successful.

Colgate used variations of this technique from the mid 70’s with the Mrs Marsh series of ads, which is to my mind the best example around. However, you do nit need to have Colgate-like budgets to use the same formula. Almost every  ad for weight loss products, gym membership, and a myriad of other things uses the same formula, varied in a range of ways.

Fix your website.

Most businesses these days have websites, and most websites I see are just bloody awful, at least they are if their objective is to build business. If the objective is to stand around and do nothing, then they are fine. There is tonne of advice out there on how to make your site more effective, and this is not about SEO, although that cannot hurt, it is about making the site more ‘sticky’ for when people visit.

There are some pretty simple things that will help add ‘stickyness’:

  • Understand your Bounce Rate. When a visitor to your site fails to move past the first page, it usually indicates that you have failed to engage them, they ‘bounce’. Experiment with differing treatments on your site, noting those that do not work, and ‘doubling down’ on those that do.
  • Ensure there is a prominent headline that leads to an action, top and centre of the page. As  noted above, problem/solution headlines work well in this context
  • Make it clean and uncluttered, so as  not to distract the visitor from the next thing you want them to do
  • Use video. Up till recently, Video was not a common tool, but as site visitors become more fussy and less likely to stay out of curiosity, and video gets better and cheaper, its use has exploded, as have the expectations of visitors.
  • Have social proof prominent, especially video testimonials prominent on the site. People want to be assured by people they can relate to that you are trustworthy, and will treat your money with the same respect they treat theirs.
  • Collect emails and mobile numbers. The old saying, ‘The money is in the list’ still holds, but in these days of mobile, having mobile numbers is becoming increasingly important, SMS messages have an almost 100% open rate, and is remarkably flexible. For example, if you run a restaurant, and have 20 seats available one evening, and you have mobile phone numbers, send out an SMS offering a bottle of champers with dinner as an offer to fill the seats, tonight. It may be that the average revenue on a table is $150, with marginal costs only for the food of perhaps $25, and you have just given away $20 to get the seat filled. Seems like a good deal, and the those who get the champers will be pleased, and talk about your restaurant.

Finally, and importantly, get stuff done. So often I see the results of procrastination, and self doubt, don’t let it hamstring you, and if you need a nudge, call me.

Social media, Wholesalers of eyeballs.

Social media, Wholesalers of eyeballs.

Jul 11, 2016 | Branding, Marketing, Social Media

The business models  of all major social media platforms require a profit, and they generate that by being wholesalers of eyeballs.

They do not do it for free, any more than your wholesalers of produce at the city markets provides their service for free.

Social media platforms fight for the attention of users, then sell the users attention to advertisers, attracted by the ability to slice and dice the audience in ways almost  unimaginable a decade ago.

However, at the foundation level, little has changed since the dark ages of print media, just a decade ago, when profitability depended on content being sufficiently attractive for buyers to purchase a newspaper or magazine, offering the opportunity to advertisers to show them their advertisements. The only difference is that the media is now run by algorithms and often crowdsourced content, rather than journalists and typesetters.

The objective is unchanged, creating the situation where advertisers are willing to pay for eyeballs.

The fight for this wholesale market share also has not changed much. Newspapers over the years consolidated and generated profits by a combination of scale delivering low cost, and regional eyeball oligopolies, often monopolies.

Now the digital platforms are playing the same game.

Facebook has once again tightened the screws on brand marketers by reducing the eyeballs that will go to their pages. They talk about enhancing the experience for their customers, i.e. those who use Facebook, not the advertisers who are trying to reach users. Controlling access to the newsfeed is a way of controlling supply, and every economics 101 student knows that the intersection of the supply and demand  curves is the price. Build demand, restrict supply, Goldmine.

Microsoft’s purchase of Linkedin for $US 26 billion last month (June 2016), an eye-watering amount, is a similar play for eyeballs, and seems great value when compared to Facebooks purchase of WhatsApp which was still just a startup, for $US19 billion in early 2014. Microsoft had a big hole in their grip on their business customers, now filled by Linkedin. So it seems that even more than ever, Facebook will be the social platform for socialising, and  Linkedin, which includes the Slideshare platform purchased for what now seems a paltry $US119 million back in May 2012, the social platform for business. Given Microsofts power elsewhere in the digital ecosystem, with the ageing cash cow ‘Office’ platform, their enterprise offerings, and Xbox for consumers, it is a logical hole in their range of eyeballs.

All of this leads to the simple conclusion that the marketing priority of businesses should be the building of their own eyeball platform,  their website and own ecosystem that leverages the wholesalers to your benefit, not just theirs. In your own home you can do pretty much what you wish, instead of being at the mercy of the landlord as you are when you rent.

 

How to create a persona that will deliver sales

How to create a persona that will deliver sales

Jul 6, 2016 | Branding, Customers, Marketing

Three key questions all marketers (should) ask themselves at some early point in marketing program development, and obviously have a great answer, are:

Who are we talking to?

Why should they listen to us?

What do we want them to do now?

These are the exact questions that  a well-crafted persona can help answer.

It will help you make good decisions about the content you create, and the channels you use to communicate to those who are most important to your success.

A persona is a composite picture of someone who incorporates  of all the behavioural and personal characteristics of your ideal customer. You can take it to the extent of being ‘hyper-personal’ and in some circumstances such as the sale of a very expensive, luxury car, that may be an effort well worth making, but in others, it may exclude many who may have minor variations, inconsequential to the purchase decision.

I have used the ‘Who, What, Where, Why’ model extensively to define the ideal customer with my clients. It is an iterative process, deceptively demanding, as it requires decisions about who is not an ideal customer, and therefore excluded from primary consideration.

Most small and medium businesses really struggle with this exclusion. It does not mean you do not sell to them if they walk in with money in their hand, but it does mean that you do not expend limited marketing resources trying to convert them, as there are better returns for your marketing dollar elsewhere.

Who: is the demographics they may exhibit. Where they live, age, sex, education, job, and all the other quantitative characteristics that are available. These parameters are all that was available until digital tools came along.

How to create a customer persona

Customer persona

What: are their behaviours. Do they go to the opera or rock concerts, perhaps both, do they travel overseas for holidays, what sort of causes, if any, do they support, are they likely to demonstrate their beliefs publicly, or are they just internal. All the sorts of things that offer a picture of how they think, feel, and behave in all sorts of situations.

Where: will you  find them digitally, as well as in the analogue (perhaps real) world, and what means can you use to make a connection. Are they likely to be avid users of Facebook, Linkedin or other social platforms, are they comfortable buying on line, do they ‘showroom’ digitally then visit the physical retailer, do they get their news from facebook and Reddit, or more focussed news sites, or even, surprise, surprise, newspapers.

Why: should they respond to your entreaties, to do whatever it is you are asking of them. Normally it will be something that will alter or manage their behaviour in some way. In every commercial case, this will end up being persuading them to buy from you, and certainly from you in preference to an alternative.  Interim steps may be to get some sort of conversion on the way to a sale, download a brochure, visit a location, whatever it is you are asking them to do.

Having built something of a picture, from the Who What Where Why method, it often leaves you well short of a complete picture that will determine the sort of material required, and the best means to communicate it. In any event, the process is iterative, and every step helps, and every misstep teaches you something.

An essential adjunct to the creation of a persona is to create a customer journey map. This is the process that your ideal customer will go through from the initial itch, to awareness, consideration, preference, then to the transaction. This will enable you to use the persona to inject yourself into the decision making and buying process a customer is going through to optimise your chances of success.

Identify. A potential customer only comes into the market when they see a need to be addressed, or a problem to be solved. In some way, the first stirrings that lead to them recognising that there is a need to do something, which may involve a purchase at some point, will start the process that leads to the transaction.

how customers arrive at a decision

Customer journey

Research. These days almost everyone goes to Mr Google as a first step in research for anything beyond the most mundane and regular purchase. Often the purchase decision is made before potential suppliers know a buyer is in the market, but it is in this research phase that canny marketers who understand the profile of their ideal customers have the opportunity to seed the sort of information that will get them onto the buyers short list, at least.

Evaluate. Emerging customers will evaluate the alternatives on all sorts of parameters important to them. Performance, delivery, style, price, after sales service, brand reputation, what their neighbours might think, and many others. It is this point where the parameters of the problem to be solved  becomes increasingly important as the customer removes options from the ‘possibles’ list to come up with a choice. It is also this point where the purchase decision still often moves off line. Not many people buy a new car on line without going to a dealer to drive it, or a shop to try on the new evening wear.

Buy. The transaction, now a tiny part of the whole customer journey, but still where the cash to pay the bills is generated.

Use. For many purchases, the transaction is only the beginning of a following process that seeks to ensure that the product meets or better, exceeds the expectation that led to its purchase, thus creating loyalty. Loyalty can be expresses as a willingness to recommend your product to others, the strongest marketing tool there is. When the product delivers less than the expectation, the purchase process is re-started the next time, and even worse, the poor experience is spread.

There is nothing routine or easy about all this, it is a journey for both the buyer and the seller. The sellers job is to find the ways to get into the buyers head as early as possible in the process, and better yet, assist the buyer to define the parameters against which the alternatives will be evaluated. This in not always possible in B2C markets, but in B2B marketing, being able to influence at an early stage is a crucial competitive tool.

The combination of a clear persona and therefore a definable market niche to which you are able to deliver a differentiated and valuable product is the foundation of commercial success.

 

Is the net killing marketing creativity?

Is the net killing marketing creativity?

Jul 1, 2016 | Branding, Marketing, Strategy

There is just so much stuff around on the net, everything and anything you ever wanted to know, or could think of to ask, is there somewhere.

The availability is removing the necessity to think, to capture the essence of a problem, and then develop creative  solutions and the means to communicate.

Too often the list driven, by the digital book solution, is the only strategy considered.

This blog is no different, when I do a list post with an attractive hook in the headline, views spike. It is a seductive outcome to write a post and double the average number of views.

Marketing has always been about people, with all the vagaries that apply when  you deal with people and their idiosyncrasies.

The people who did marketing well were those able to connect the dots in some way that added value to others. It is essentially a creative skill. Not in the sense of being able to create a drawing, but much broader than that, being able to see things that others cannot.

Then along came the web, and the ‘quick fix’ world we live in, a world of instant gratification, where lists rate very highly, because they meet the need.

But what about the thought process, the creativity??

What about strategy that connects people with unique solutions to their problems?

What about the stories that make things memorable and repeatable?

As I get older, it becomes increasingly obvious that the foundations of marketing, the delivery of value to someone who is prepared to pay for it more than it costs for you to deliver it, are unchanged.

I suspect they are unchanged since Babylon was being built.

How do we come back at this?

How do we ensure that marketing has the depth of thought necessary to truly make a difference?

These days I joke that to get a marketing degree you just need to have a pulse. This is proving to be unfortunately true the more I see the quality of those degree qualified automatons around now, inhabiting businesses and being supposedly in charge of a businesses greatest asset, its brand.

Why was Mad Men was a great TV series?

Not just because it was entertaining, and told stories, but because it was able, for some of us, to tweak a nerve so deep in our psyches that almost hurts. Don Drapers pitch to Kodak, the throwing out of a brief that spoke about the technology, and replacing it with one that spoke to peoples hearts is a classic.

Would that have been possible if Don was following a list?? Beware the siren song of marketing by lists, they can lead you onto the rocks.

The 2 faces of a brand

The 2 faces of a brand

Jun 15, 2016 | Branding, Marketing, Strategy

Marketing and management generally, regularly find themselves actively promoting their branding credentials.

Often they would appear to have no idea beyond the mouthing of clichés why they are bothering.

The costs of building, maintaining and updating a brand is often a major item on the  P&L, and there is much written about the techniques and strategies that deliver a return. However, the core question of ‘Why bother” rarely gets a mention.

Until now.

A brand has two faces:

  1. For the brand owner, a successful brand delivers to its owner a stream of revenue and margin. There is no other reason for the investment necessary for building and maintaining a brand to be made.
  2.  To the customer, a brand offers some level of assurance about the performance, integrity, longevity,  and many other characteristics which to them are important. In other words, the value delivered by the brand, weather that be one defined by the physical performance and characteristics, or the emotional  dimensions of the brand.

“Branding” seems pretty simple, and in principal it is, but the optimisation of the investments made over the long term is the tricky part. This requires expertise and experence pretty hard to find in these days of instant digital gratification.