The sad and entirely avoidable death of a great old FMCG brand.

The sad and entirely avoidable death of a great old FMCG brand.

Aug 26, 2019 | Branding, Innovation, Marketing, Strategy

Currently in my cupboard almost gone, is a bottle of detergent, a well known and trusted brand, formerly the market leader, been around for ages.

It will not be bought again by anyone in my household.

Here is what I suspect happened.

Sales of the brand were eroding as cheaper, usually house branded product ate into the volumes. Somewhere in the multinational that owns the brand there was a bright young thing charged with resurrecting volumes, a project to ‘test their metal,’ requiring a 20% increase for success to be declared.

He, or more likely these days, she, did the corporate rounds seeking inspiration.

The R&D people believed they could improve the performance of the product by utilising a new emerging technology, but it required an extensive  R&D program to clarify some of the technical issues. No budget available.

The Engineering people reckoned they could speed up the line, reducing costs by updating, at considerable capital cost, the existing machinery, making production cheaper and more flexible. This would  reduce the systemic out of stock problem caused by the long runs required to generate factory efficiencies. These factory KPI’s are completely disconnected to the increasing difficulty of forecasting sales as volumes erode and become more erratic. No capital budget available.

The accountants are arguing for a price increase as well as a reduction in retailer promotional spend, as the gross margins fall below their target rates. Neither tactic seems well suited to the problem at hand.

The advertising agency strongly recommended a multi million dollar integrated TV, Magazine and digital marketing campaign, designed to bring back lapsed users to the brand, while intriguing new users to give it a try. No budget available.

The marketing he/she concerned reckoned it would be easier and cheaper to make the hole in the top bigger, make the product flow faster, encouraging a quicker usage cycle and therefore increasing replacement sales.

On a spreadsheet it looks logical, sensible, and with a great ROI. Everybody was happy, especially the product manager, who could see the trappings of corporate success coming his/her way by Christmas.

Whoops: forgot the value conscious consumer, to whom the integrity of the brand had remained, until now,  an important consideration, and who is not stupid. She is my wife, (who still does the bulk of the shopping) and believe me,  she is absolutely unforgiving.

Being captured by the interaction of functional KPI’s, status quo management processes, and resistance to any change, is a common corporate problem. It is unsolvable by anyone other than the Boss, who is mostly too busy contemplating the forest next door (or their navels) to see the trees in the forest they currently occupy, and take some decisive action.

When your brand, marketing, and innovation processes need a reality check, call me to tap into the ‘experience bank’ in my possession. 

The hyperbole trap

The hyperbole trap

Aug 21, 2019 | Communication, Customers

 

We marketers as a stereotype tend to adjective driven descriptions that make little logical sense, and in some cases, are in fact misleading.

Yesterday in a major supermarket deli section I saw two examples that should be taken out the back and flogged.

The first was ‘organic salami’. I am aware of organic chicken, beef, tomatoes, and others, but I am unaware of an organic salami running around anywhere. I am not sure I would recognise a live salami if I saw one.  Presumably the motivated copywriter hidden in the bowels of the retailer, or more probably, a well-meaning deli manager in the store, wanted to differentiate this salami from the others on display. They were probably made in the same factory, from the same ingredients as some of the others,  and certainly were not certified organic. Hyperbolic over-reach, and either completely incorrect, or the rules governing the use of the word ‘organic’, have been radically and terminally loosened since the last time I looked.

The second, equally misleading, was ‘Fresh Sea Barramundi’. Unfortunately for the copywriter, barramundi is a fish species that does not live in the sea, it is native to the coastal rivers of northern Australia, with close genetic relatives found throughout S.E. Asia.  The only exception to this rule of nature is when the barra is ‘farmed’, presumably not an attractive description. Again, a misleading and factually wrong product description used in the quest for hyperbolic impact.

I am nit-picking, these examples are relatively minor in the scheme of things that are manipulated to attract consumers, but nevertheless, struck a chord when I saw them. I will admit to a chuckle at the evident lack of recognition that most consumers are not fools, and would see through the hyperbole for what it was: flowery and meaningless language.

However, retailers are held to account. Regulators do not like false product descriptions, and more importantly, consumers, who have come to accept that the food they buy in supermarkets is as described, may start to have the trust eroded, just a tiny bit by such nonsense, and in the long term, this will damage the supermarkets brand.   

Do you allow your marketing people to wax illogically lyrical, or insist on well crafted copy that delivers a value proposition devoid of superfluous hyperbole?

 

Header cartoon courtesy Tom Gault.

 

 

 

 

Consider your ‘Doorman’ strategy

Consider your ‘Doorman’ strategy

Aug 19, 2019 | Branding, Marketing

 

It appears that the role of a doorman in a hotel is to hold the door for guests, easing their way into and out of the hotel.

Ostensibly the role is simple, a smiley face, welcoming word, courtesy extended. However, when you think about it, there are many more roles played by the doorman, taxi getter, luggage helper, direction giver, polite conversationalist, security,  all the while, adding to the value by creating a human face for the hotel.

When  you get rid of a doorman, as many do, and put in automatic doors, it may be cheaper, but you lose the impact of all that humanity that adds value to guests and visitors. The result over time will be added pressure on margins, as regulars go to the hotel down the road with a smiling doorman who takes the trouble to learn their names, welcome them back, and offer friendly assistance.

A cheap hotel will not have a doorman, guests in that hotel would see it as an extravagance,  but the sudden absence of a doorman in a 5 star hotel would somehow signal its slide to 4 stars.

These days, your doorman can be a website, social media persona, the tone of your advertising, as well as the people at the ‘front line’ of customer contact.

A former employer had a receptionist named Janice. She made everyone with whom she came into contact, in person or over the phone, feel better about themselves, every day. We did  not pay her anything like the value she delivered, just by being her smiling, generous self.

How does your ‘doorman’ shape up?

 

Header photo courtesy ‘Frank’  via Flikr.

A pox on their houses!

A pox on their houses!

Aug 14, 2019 | Marketing, rant, Strategy

 

It seems that ‘Influencers’ are chasing me everywhere.

I have been receiving messages from one who needs me to be rescued by using the product she flogs. Perhaps it will make me look younger, but I doubt it, and I certainly would not pony up the absurd amount of money to buy it from her special friend, at the special once off price, only available to her followers.

I am not a follower, nor am I a 24 year old female millennial, and I have been around way too long for the nonsense about scarcity to have any effect at all on me.

All I would like to know is who the hell sold her my mobile phone number, and why does she think I am interested?

There is nothing wrong with using a celebrity, someone with real influence, to provide a spokesperson for your product. It has been a valuable element in the marketing armoury since the advent of advertising.

However, it is dumb to use a celebrity in the absence of a creative idea, born of a strategy.  A way of communicating the value your product can deliver to those who may buy and use it.

I am perhaps old and cranky, but the hugely increasing use of so called ‘influencers’ self styled gurus of nothing important, gives me the Tom Tits. 

If you want to demonstrate the paucity of your strategic marketing chops, go pay some silly Instagram influencer a pile of money to post your rubbish on their site, so the bots can like it and they can charge you piles of money that could be put to better use.

It is lazy, lazy, and no substitute for doing the hard work of diagnosis of the problem or opportunity, followed by the development of an appropriate strategy. This necessitates hard work,  making difficult choices, accepting risks, and implementing, learning, and going again.

Too often I see silly marketing people convincing themselves that an influencer campaign, whatever the hell that may be, is the solution to, well,  whatever, which is normally all about being seen to be doing something.

Do the work instead.

 

Cartoon credit: Courtesy Tom Fishburne at marketoonist.com

 

 

 

The cost of failing to build brands

The cost of failing to build brands

Aug 12, 2019 | Branding, Customers, Governance, Marketing

 

Direct marketing is highly tactical, it is a one on one communication from the marketer to the consumer. Within the boundaries of some limitations, the outcome of direct marketing can be quantified with a considerable level of confidence.

You either got a response, or you did not. It is tactical, short term, and transactional.

Because it is so responsive to short term quantification, and our digital lives are all about quantification, these tactical elements are now predominant. However, there is no evidence that tactical activity alone will build a brand, and plenty that an overuse of tactical stuff will actually destroy a brand.

By contrast, building a brand takes time, investment, a great strategy, and the nerve to continue in the face of debatable real time data, and short term expediency.

Just look at what has happened to proprietary brands in supermarkets. They have been destroyed by the power of the retailers demanding tactical promotional dollars, which is code for retailer margin protection. This has been given by suppliers, usually reluctantly, at the expense of brand building, simply because it is easier and expedient in the short term to comply.

Consider Meadow Lea. At its height, Meadow Lea had a 23% market share at premium prices in a crowded and growing margarine market. The great advertising supported by a range of customer focussed promotional activity that had built the brand, was stopped in favour of tactical retailer price promotions. Now, 20 years later, Meadow Lea is just a label on a few Sku’s in the chiller cabinet.

Imagine you are the marketing manager of a branded product, you have a finite marketing budget. You need to convince the CEO, who is an engineer or an accountant, that it is better to keep advertising for  the long term health of the brand, than give in to powerful retailer demands for various forms of retailer margin supplementation, which will retain distribution in the short term. This has been a very hard argument to win for all but a very few FMCG marketers. With the benefit of hindsight, it has been a vital one that was lost.  

Had the argument been won, and a balance between the two been found, what would have been the difference to the revenue and margins of both retailers and Meadow Lea Foods?? Most probably in the hundreds of millions of dollars, and consumers would have benefitted by  continued value innovation in the spreads  category, which has been stagnant for years.

 

 

Trust: A rare priviledge that is hard to earn, never just given.

Trust: A rare priviledge that is hard to earn, never just given.

Aug 9, 2019 | Branding, Marketing

 

Trust is a word bandied around liberally, like a ticket to be attached to a piece of luggage. A label, adornment, meaning little.

In a world where the bonds of community have been broken down by the pressures of the 21st century, real trust is a rare and earned  privilege.

A brand is a badge of trust.

We tend to trust a brand where there has been a lot of media, after all, if the enterprise that owned it did not believe in the product, why would they invest? To some degree, this is the only advantage old media has over digital, most consumers see it as really expensive, while digital is seen (wrongly) as cheap.

Trust is never just given, it has to be earned.

Consider ‘The Knowledge’ as an example of trust.

This is the test you need to pass in order to get a licence to drive a black cab in London.  To pass this most demanding of tests, an applicant must know every street, major building, place of interest, cross road, and transport stop, within 6.5 miles of Charing cross station. This adds up to 25,000 streets, many of them with the same name, and 20,000 landmarks. This is in addition to all the major routes in other parts of London. In a day of the GPS, Uber, and an alternative licence for a ‘mini-cab that is not much more than an over the counter transaction, why would you bother? So why is it that there are still people lining up to do spend the time and money to do the training to qualify?

The answer may sound weird, but ask yourself, who would you rather trust with your daughter on her big night out? Someone who had invested years and a lot of money into passing The Knowledge, and who would lose it after any sort of malfeasance, or someone who just turned up with a car and a GPS? 

The driver of a black cab has earned your trust, not because you know them,  but because of the investment they have made, which they would be dumb to risk, and dumb people cannot pass ‘The Knowledge’.

Consider that the next time you could benefit from dispassionate advice based on deep experience. 

Photo credit: photo_forest.