Jul 19, 2011 | Branding, Customers, Marketing, Social Media
Procter & Gamble is a huge branded consumer business, but seems to be able to maintain the agility and innovation capability of an SME. Supermarket retailers have to be nervous when they display a determination to build a direct business model for their brands, and when they start talking about “qualified retailers” it is music to my ears, having struggled in an unforgiving Australian FMCG duopoly for years. It is the other side of the coin from retailers developing their own brands beyond Housebrand status, noted previously.
P&G tried with Amazon, and the effort had its challenges, so they are quietly widening the approach with this facebook collaboration, creating a new descriptor in the process, “f-commerce” and recruiting Wal-mart as a “qualified retailer” (not bad for a start)
This also ticks facebooks boxes, as it is a strategy to monetarise their huge base of connections to consumers, and sets them against Amazon in the e-fulfilment business.
Poor old Microsoft, increasingly it seems to have missed the boat. Just a decade ago the US government had them in court trying to break them up to give others a chance.
What’s the old saying about roosters and feather dusters?
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 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.
Jul 7, 2011 | Customers, Marketing, Social Media
Every marketer tries to build in switching costs into his product, something that makes the decision to change a bit more difficult. These switching costs have 2 elements:
- Real costs, like contract penalty clauses, loss of use of some useful feature that needs to be replaced, physical costs of going to the bank and closing/opening accounts, pulling out a piece of machinery, and so on.
- Emotional costs, and these are the killers in consumer categories, the loss of “cool” the loss of relationships with a brand and other adherents, the perception that by not using brand A, you no longer have something of value to your “tribe” a sense of belongingness.
So how will the much hyped Google+ attract Facebook users?
The hype says that Google+ has lots of features that social media wonks want, and it may have, certainly seems there are some good ideas, but what it does not have, and will possibly never have is the emotional investment that users have sunk into Facebook. To move your social identity to a new platform means you have to move everyone else in your network, and replace the manner in which the interactions occur, ands make it better. Seems pretty unlikely to me no matter how much better Google+ may be.
Myspace has just been flogged by Rupert Murdoch’s News Ltd for $33 Million, which is a huge bath. A purchase price of $900 million in 2005, and accumulated losses that could run into billions, and despite the advantage of first mover in the social space, it got mowed down by FB, which now has an “installed base” of users of 750 million, with all the links and networks that number implies.
Short of Google+ having an “app” that enables the downloading of all material and links a FB user has on his site, something I cannot see FB allowing, Google+ will be starting from scratch., and who needs a second social site that is just a “bit more” that the familiar FB? will the attraction of limited free video confering be enough? Myspace has proved probably not, particularly as it is unlikely FB will sit around wondering
