Archive for January, 2010

Marketing is all about product too!

Friday, January 22nd, 2010

Following the Guardian’s interview with Starbucks founder, Howard Schultz (http://tinyurl.com/ycffluw) there has been a lot of tweeting about the rights and wrongs of his strategy for Starbucks. The fact is that Starbucks ranked number 90 on Interbrand’s 2009 list of global brands (http://tinyurl.com/3e9lyp), down five places on a year ago, coinciding with a 16% decrease in brand value; so something has to be done.

Schultz’s diagnosis of the company’s problem is that growth had been seen as a strategy when, in fact, it is merely a tactic. By putting too much of the company’s focus on growth, mistakes were made that were disguised, when they should have been investigated and corrected. His solution is to go back to his original inspiration of the ‘romance of coffee-making’ and cater for the communities that Starbucks serve with an individual, non-corporate look.

The first experiment of this new look was in London’s Conduit Street that opened in November 2009 (see photos at http://tinyurl.com/ye79s8r). It looks more upmarket, with great attention to the furnishings, and the coffee counter has apparently been designed to emphasise the brand’s coffee authority. There are due to be another 100 of these individual refits across the UK by the end of 2010.

Whilst, in this new look, the corporate branding is much more recessive, even tasteful, in Seattle, USA, Starbucks has gone a stage further and is trialling three totally unbranded stores that have been designed to resemble independent local cafes. Critics have dubbed these outlets as ‘Stealth Starbucks’.

Fundamentally, I believe Starbucks has two marketing problems in the UK. Firstly, the brand needs to engage with its consumers and deliver the type of coffee experience they want. It can’t do this by refitting stores to ‘pretend’ to be a local coffee shop that will be rejected when people realise it’s really global brand Starbucks. They should look at the challenger brands that have grown up in their wake and see why consumers. In many cases, have a closer relationship with some of these.

Secondly, and most importantly for me, they need to look at their product. I am a real coffee drinker. I drink my coffee black (ideally a double espresso) and unsweetened, not frappuccinoed with fruit juices and cream! So I actually TASTE what I drink and Starbucks coffee is not good! I can only really liken the thin flavour and strange aftertaste to the comparison between real 70% cocoa chocolate and American chocolate like Hershey’s. There is no comparison.

So, if you’re listening Mr Schultz, marketing is all about the product too!

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50 but not out: targeting the (slightly) older consumer

Thursday, January 21st, 2010

I went to a very interesting group discussion with a group of other, well, that was the point, what DO we call feisty, successful, purposeful women over 50? (Any thoughts please send to me on Twitter @BarbaraStopher) We’re the baby boomer generation and are pioneering what people of our age can do. In our youth, people in their late thirties / forties were ‘middle aged’, a derogatory term that conjured up a pastel twin set and a tight curl perm.

The women I met were as far from crimplene and perm solution as the weapons of mass destruction were from reaching Britain! A more trendy US term for women like us is mid-life, which at least suggests there is more to come! But are we the sort of people who want to be categorized and labeled?

The trouble is that marketing and advertising for the big brands is in the hands of relatively young people. The new IPA census (http://tinyurl.com/y9t5aau) shows that 45.2% of advertising agency employees are aged under 30, with another 37% being between 31 and 40, 12.7% between 41 and 50 and only 5.2% over 50. Perhaps that’s why I heard colleagues talking about a brand wanting to target the grey market and the immediate solutions that sprang to these naïve young minds were Saga and bingo!!

But we have to admit that we are a difficult target group to reach. We complain that there is nothing representative of us in the media or targeted to us as a niche market but then, in the same breath, we also want to be part of the crowd, shopping in the same places as everyone else and not ghettoized. Is that because we are truly rewriting the rule book or because we don’t want to admit to getting old(er)?

I have just received a newsletter update from Springwise with their top 10 business ideas for 2010 (http://tinyurl.com/ye5hx2j) and there it was again; a newly launched company called Ruby Slippers (www.rubyss.co.uk) that claims to stylishly renovate homes, combining good design with practical functionality so that the effects of ageing are invisibly catered for. Now I know that this service will be valuable for some and is targeted more at those over 65 but I’m just a bit concerned at how much ageing I and my fellow (now what was that collective term for 50+ feisty women again?) are supposed to do in the next 10-15 years?!

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What’s in a brand?

Wednesday, January 13th, 2010

In the Interbrand survey of global brands by value for 2009 (http://tinyurl.com/3e9lyp), it is probably not surprising that over half (51%) of the world’s biggest brands are based in the USA with Coca-Cola, IBM, Microsoft and General Electric staying in their same 1 – 4 slots as last year. But why should the USA dominate over half of the world’s brands when they only account for less than a quarter (23.6%) of the world’s GDP? Two other countries that punch above their weight in the brand stakes are Germany, with 11% global brands versus 6% GDP, and France, with 8% global brands versus 4.8% GDP. And what about us Brits? Where else but in the middle of the road with 4% global brands versus our 4.4.% GDP; our first entry is HSBC at number 32 with no further entries in the top 100 until Smirnoff at number 83!

So why don’t we in the UK punch above our weight? We are praised internationally for the quality of our TV advertising yet we are more keen to ridicule brands for the most irritating ads of the year as published by Marketing Magazine (http://tinyurl.com/yc5acdh). Number one of that chart was GoCompare.com with the over-inflated opera singer. This was an in-house produced ad as were the ads at position five (confused.com) and seven (WeBuyAnyCar.com), also for internet brands.

The price comparison industry is over ten tears old and visitor numbers to some of the largest sites fell by 30 per cent in the first four months of 2009; so it’s no surprise that GoCompare.com and confused.com are battling it out in the irritating jingle stakes. It’s undeniable that irritating ads stand out; GoCompare’s own consumer research boasts a 200% increase in brand awareness since the activity began in August.

But the ten million dollar question is… does awareness translate to sales? Previous annoying ads, such as Cillit Bang, created sales spikes that could not be maintained post advertising. In fact, Cillit Bang has just been voted the UK’s most disliked brand name according to a survey by branding consultants G2 (http://tinyurl.com/yesbqbb)

A poll by TellyAds.com (http://tinyurl.com/yaxwe94) for the most popular TV ads of the noughties had GoCompare.com at seventh position with the only other brand to appear on the most irritating AND most viewed top 10 lists was Churchill, the world’s most famous nodding dog. Top of the TellyAds poll was Cadbury’s Dairy Milk ad featuring a boy and a girl with dancing eyebrows. But where has the most viewed ad got Cadbury? A hostile take over bid that is being given more likelihood of success, despite warnings of up to 7,000 job cuts, with the withdrawal of Ferrero from the race.

So, what’s in a brand? A brand allows you to give your product or service a personality and there’s nothing to stop your brand being as important to your specific target audience as the giant brands are to theirs. In fact, the more specific and ‘niche’ you are, the more you can gain a competitive advantage over the big guys. These are often called challenger brands. Think of Innocent versus Tropicana or Apple versus Microsoft. The key thing is to engage with your audience and, ideally, not irritate them to death!

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