Jul 18, 2011 | Branding, Customers, Marketing, Strategy
There is a new boy on the block to match Colgate, P&G, and other international brand owners, but one who does not play fair, one who controls access to consumers, removing their options of choice. Tesco. A retailer with the clout of Tesco that comes from its scale, with its ability to determine which products consumers will see on shelf, is aiming to develop international housebrands in competition with its suppliers.
Some will see this as just commercial common sense, Tesco leveraging their hard won position with consumers, whilst others will see it as the death-nell of brands, something to be opposed by any means.
I suggest it is neither, but neither is it something in the middle, there are other dimensions to the decision that will determine the outcome:
- Will a retailer be able to develop the deep consumer understanding that feeds a sustainable marketing, brand and product development effort necessary to build a real brand as distinct from labels on shelf?
- When a consumer has a problem with a Tesco branded product, and Tesco fails to manage that problem in a satisfactory manner, will the consumer just move to an alternative product, or move to an alternative retailer?
- Will the presence of Tesco branded products on shelf in a category further remove the incentive for proprietary brands to invest in category growth, and will the further removal of that support damage category profitability for Tesco? This profitability squeeze appears to be happening currently in many categories being demolished by retailer housebrands, will it just get worse?
This development is a logical evolution of the path retailers have been travelling for some time, the only real question is weather evolution accepts the change in the model, or will the model, having evolved past the point of sustainability, now wither and die in the face of more effective competitive models.
Jul 14, 2011 | Branding, Marketing
Brands are not uniform things, they are an amalgam of all sorts of contributing factors, patterns of attraction, that together make up an experience.
People recognise and relate to brands in a very personal way, and in the age of net communication, the opportunity to build and leverage from the notion of brands as patterns of behaviour and preference is building daily. People have friends who are all different, but looking behind the people, there will usually be a few common denominators, education, interests, a particular point of view, something that binds them together that may not be immediately obvious.
The brands people choose to engage with are no different to the people they choose to engage with, they contain a pattern of characteristics that is attractive.
Jul 14, 2011 | Innovation, Social Media, Strategy
The fun and games predicted are starting!
Facebook has added Skype to its services, in an expanding collaboration with Microsoft , and in response to the competitive threat of to Facebook by Google+ launched recently.
This collaboration will not make the integration and building of a commercially sustainable Skype by Microsoft easier, if anything it will add complication, because the fit between facebook and Skype seems so logical, and culturally much easier than the fit with Microsoft, and the twins may just turn on the parent, leaving Microsoft again out in the cold having funded the party.
Time will tell if there is any parallel between this set of deals and the humbling fiasco that was the recent divestment of Myspace by News Ltd, an instance where the cultures of an “old economy” business trying to transform itself and taking a bath in the process, although it seems pretty amazing to put Microsoft into the “old economy” bucket, but culturally, that is where it belongs.
Jul 11, 2011 | Social Media
I’m thinking ahead here, to the next federal election, the one Tony thinks is already on. I suspect the communication mix of this election will be different to those that have gone before, Social Media will play a significant role, perhaps even a deciding role given the lack of depth in anything the protagonists say, and the skepticism of the electorate.
Here’s why:
- Use of SM by over 50’s is rapidly increasing, the Boomers & 60’s generation my be opening a facebook account to see their grandkids, follow to the holiday snaps of their friends, but they are not dumb, and are rapidly exploring the other uses, and becoming enamored.
- TV, previously the major communication channel for pollies has faded into the background as it has fragmented, time shifted, and been overwhelmed by SM.
- SM is cheaper than pouring massive amounts into TV. It still costs, but the bang for your buck is potentially far better
- SM enables quantitative, real time measures of the effectiveness of messages, actions, and policy statements of both themselves and the opposition, allowing pollies to tailor their message in real time.
- The clincher, SM can be two way, voters can communicate back, and engage, an empowering experience.
Genuine engagement by the electorate may scare the daylights out of pollies, and their acolytes, but is just may be the savior of our democracy.
Jul 10, 2011 | Change, Innovation, Marketing, Social Media, Strategy
I have praised the way Tesco has adapted to the emergence of smartphones as a marketing tool, particularly in the UK by combining Loyalty card use, Dunnhumby data mining and smartphones.
Sensibly Tesco are migrating this technology elsewhere in their growing global footprint, including Korea with the use of virtual supermarkets to add value to shoppers by easing their time burden.
Recently Tesco also bought US start-up specialist social marketing agency BzzAgent, highlighting their determination to push the boundaries of social media and technology turning the emerging technical capabilities into marketing tools.
Australian retailers are dragging their feet badly, but with all the ex Tesco management now in Coles, there will be movement on leveraging the data on store cards and into net shopping pretty soon. Others will follow as they get their acts together, so suppliers to retail need to get their heads around how these changes will impact them in an environment where the change over the last few years has been huge, and they lose control of their brands via the rapid market share increase of housebrands as they become the Sku of choice for retailers.
