Corolla – the Total Lack of Personality

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To me Toyota Corolla symbolizes the total lack of personality. I’m not even worried that I’d offend people who drive it because they are probably so pragmatic that being offended seems like a waste of emotions to them. Year after year Toyota manages to “design” the non-descript, unnoticeable sedan perfect for a surveillance vehicle that you can park in front of buildings for days without anybody noticing the car. The 2011 model is no exception – the design finally caught up with what Hyundai Elantra looked …in 2000.

 

Turtle Wax Commercial

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One commercial on Versus that I particularly like is the Turtle Wax Ice commercial below. It nails down everything – the message, the execution, the channel, everything! I think that commercials like this are the earthly appearance of (and justification for) focus groups, zmet analysis etc. theoretical tools. It clicks with me – I associate with the guy, it’s on Versus – the boys channel, and most importantly – I REMEMBERED the product after the first viewing: Turtle Wax Ice. It is not often to see such a quality commercial for such a niche, relatively inexpensive product.

Samsung Disapointment

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Samsung’s marketers either do not profile their customers very well or don’t give a damn about CRM and brand loyalty. Android 2.2 Froyo operating system will not be pushed OTA (over the air) to Samsung Vibrant phone owners because “…this could potentially hurt Samsung Galaxy 4G sales”!? Dubious argument at best. The adverse effect of this decision, however, is clear – annoyed Samsung Vibrant owners. What were the folks at Samsung thinking? If someone shells out $500 for a smart phone s/he probably gives a damn about what it does and stays on top of things such as a major operating system upgrade.

The upgrade is available if you go to Samsung or T-Mobile website and search a bit or, as I did, burn some customer service money by chatting with a rep online until they sent me a link to the step-by-step upgrade instructions. I don’t know what Samsung and T-Mobile put in their prenuptial agreement regarding such decisions but not sending Android 2.2 OTA to existing customers makes them both look bad.

Fairweather fans are the cash cows II

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Almost a year ago I wrote a blog post Fairweather fans are the cash cows, it’s time for an update. For the Washington Capitals the weather is not fair anymore as this season they are a mediocre team at best. Let’s not worry about them, however, and see what’s happening with the cash cows. I consider myself a cash-cow for the Caps and NHL because I occasionally buy overpriced tickets, merchandise, subscribe for hockey channels etc. I also happened to have a son who plays hockey at the mite age group (7-8 years old) and pay handsomely for him to do so. Yes, the money goes to a different league but in the grand scheme of things indirectly benefits NHL. Last year, when the Caps had a great season, the interest in youth hockey was such that my son’s team management had to cramp 21 kids in one team so they don’t turn any parents (and their money) away. This year? Not so much, as Borat would have put it. Team management and coaches are scurrying to recruit kids and it seems that the interest is winding down. I bet the situation is the same for all regional teams. On the positive side the interest in ice hockey must be picking up sharply in Tampa, FL as their team is doing great – too bad they don’t have many ice rinks there.

Compact Cameras Going the Way of the Dodo Bird

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compact cameraA few years ago my wife bought one because we were going to Rome for a week. We didn’t want to haul our bulky camera with us all the time and the compact was perfect for the abundant daylight and very convenient to carry in either a pocket or a purse. Today my cell phone has the same resolution and pretty much the same optics for Facebook and Flickr purposes. Why would I take a compact camera for marginally better quality and worry not to forget or recharge one more thing? Human anatomy and practicality play a role here – two factors that determine the faith of many  categories in consumer electronics. The smart phones are wiping up the compact cameras – a natural selection as Darwin would have put it.

Honest Tea, honestly?

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Honest TeaEvery now and then I drink Honest Tea and I noticed that all bottles have this concavity at the bottom. The first time I thought I probably grabbed a bottle that was flawed but no, all bottles are like that. The well is irregular in shape and clearly an alternation of the original bottle design. This “defect” eats up an ounce or two of liquid from the volume of the bottle and is only noticeable once you fiddle with the bottle and not while still on the shelf. There is nothing wrong with this as the actual content of 16.9 fluid ounces (500ml) is stated on the label, although not as prominently as on most other beverages.
It is common practice with consumer packaged goods (CPG) to use packaging much larger than the content inside with various explanations about it — more air for the chips so it doesn’t crumble, standardized can sizes for the coffee etc., although the real reason is rooted in the consumer behavior analysis, or in other words — a perception of more bang for the buck. In the case of Honest Tea, it usually shares shelf space with Tazo Tea, Snapple, Steaz and other substitute products and looking bigger on a hot summer day might be just the difference that would sway the purchase decision one way or another.
That is fine too, cheesy but fine. What is not fine is when you use deceptive packaging and your brand name is Honest Tea.  Even if I’m paranoid and I’m looking for a calf under the bull (as Bulgarian saying goes), even if this is totally coincidental, which I doubt, Honest Tea should “fix” the concavity because it trashes their brand essence.

Infographics

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I like infographics in public spaces, that’s the way to eliminate language barriers. A distant relative of the heraldic symbols and logos they have their own peculiarities and requirements — to be minimalistic and yet descriptive, to be culture-independent, to be in high-contrast, not to offend, …and as in my case yesterday, to entertain drivers stuck in traffic. It is much better to have the infographic on left instead of: “Expanded strollers are not allowed on bus. Put it under the bus and the driver will flatten it.”

The $64K Question: Why is Budweiser sponsoring soccer?

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Multiple sources state that FIFA filed charges against Bavaria beer company for the ambush marketing during the Nederland – Denmark match. During the game a group of women dressed in the traditional for the Dutch fans orange had Bavaria logos on their outfits. According to FIFA this violated the sponsorship rights of Budweiser and the organization felt it ought to protect its sponsor by filing a lawsuit against the company and arresting a few of the women. At this point nothing is official but many questions come to mind some of which legal in nature—under what jurisdiction falls this lawsuit? What are the charges? Where are the boundaries – if I go to a game with an Under Armor shirt will I be arrested? Will I be arrested only if Under Armor gave me the shirt for free? If a bunch of friends go to a game with jerseys purchased years ago and their team had changed sponsors meanwhile will they be escorted out? I’m not a lawyer but the common sense tells me that FIFA will have its hands full with this one. This is their official page on rights protection. Now, there is another question that really interests me – why in the world is Budweiser sponsoring FIFA World Cup when a few in the US watch soccer and a few outside US drink Bud? What are the opportunity costs? I would imagine them to be huge as it is quite pricy to partner in the most watched sports event. Any possible strategic long term reasoning calls for a leap of imagination beyond my abilities.  Enlighten me and I’ll buy you Bavaria!

Friends Relationship Management (FRM)

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The expectations people have in terms of responses to their social media posts, photos and comments vary vastly. I think that the laggards who are new to the vortex of social media expect more engagement and responsiveness than the Internet-savvy extraverts with hundreds of “friends” in their networks. The latter group knows that, unfortunately, online social networking is becoming more “broadcast” and less “dialogue”.
A few years ago a friend who had just discovered ICQ was offended when I failed to respond to messages he sent. He though I’m ignoring or mad with him. I told him that if my name is “green” that doesn’t necessarily mean that I’m in front of the PC and also told him that yes, I saw the link but just didn’t feel like writing back “cool link, thank you”.

Nowadays, when Facebook-ing I’m trying to be aware of the differences in the expectations my friends have. As a result, I would not comment or comment on the very same article depending on whether it is recommended by a prolific social media junkie or a person for whom I know has 5 “friends” in the network and I’m one of them. This is not to say that the former is a less dear friend than the latter – s/he is just aware that not all who read the article would “like” or comment on it, exactly as s/he doesn’t “like” or comment on all of the updates (which are disproportionately more in comparison with the second person).

This FRM (Friends Relationship Management) that I employ for myself, however, is not applicable for businesses. If a business entity wants to leverage social media to advance their agenda, they must be ready to put the energy and persistence to engage with all of their “friends” and show them the personal attention I have the luxury to omit for the understanding part of my friends.

BYOB – BREW Your Own Beer

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beerI bought a home brew kit last week and my first brew is happily fermenting in my basement. If all goes as planned in about two weeks I’d be able to enjoy a mug of German Altbier while brewing the next keg. I paid a little over $200 for the setup of which $160 went for the hardware and $42 went for the malt, hops, yeast and sugar. These consumables yielded 4.5 gallons of wort (the beer before it turns into beer) which is approximately 8 six packs of beer. $42/8 = $5.25 per six pack. If I forget about the sunk cost of $160 or assume that it would be spread over many many gallons of beer, $5.25 is a good price. It is equal to a six pack of Budweiser and I am sure that unless I totally messed up, my brew would be better than Bud (actually, I think it takes a special skill to brew something as bad as Budweiser).

 So I think that the price of $42 for the package with the ingredients is just right. The time to brew notwithstanding as this is a hobby, the price allows me to think that I’m getting a fair deal as I get better beer for the price of Bud and at the same time is the maximum price at which I can make this justification.

 Yes, I probably paid premium for the package as it was for newbies like me with everything measured and neatly packaged and if I were to buy the ingredients separately or in bulk it would’ve cost  much less but I’m not there yet. Plus, once you start to vertically integrate upstream you have to buy more equipment and subsequently brew more beer to be cost effective which is not what I want for the moment. Cheers.

Fairweather fans are the cash cows

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The Verizon Center was packed for all Capitals games this season. Last season too. During the 10 previous seasons, however, the Caps could only attract a few thousands per game at most. Those were the loyal fans that are now somewhat annoyed by the flock of newbies that makes it harder to find tickets and parking. The fairweather fans, however, are what really makes particular sport more popular—sounds like a statement of the obvious but there are some behavioral economics aspects worth speculating about: For NHL as a franchise it would be best if every few years different teams climb and stay at the top of their respective division as opposed to having a few traditionally strong teams dominating the game for a decade. Even better, if different cities can be awarded the franchises every few years that would benefit NHL even more, although that’s not feasible for other reasons.

Why? Let’s say the Caps lose steam and revert to the mediocre team they were 5 years ago (it was not easy to write this, even as an example), what would happen to the interest in hockey in area? It will probably go down but not to pre-Ovechkin levels. Unlike the interest, however, the awareness and the familiarity with the sport will remain: we’ve been infected and the hockey fever will return at full swing as soon as the next talented team makes several good games in a row (case in point last week were the Montreal fans that poured on the streets after 10 years of disappointments). Until that happens we’ll probably not buy hats and jackets like crazy, but we’d prefer to watch whatever Stanley Cup playoff game is on instead of Hell’s Kitchen and that’s what makes the difference for NHL as a franchise. The more dormant hockey fans you have out there, the more you can charge for commercials. In the best case scenario, they’d be in every metro area and the way to get there is by having different teams in the spotlight every few years. Let’s go Caps!!!

Spirit Air’s pre-reclined seats

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In their quest to cut costs and maximize profits Spirit Air announced that their two newest Airbus airplanes come with “pre-reclined” seats which are really “non-reclining” seats fixed in upmost position.  I don’t want to comment on the low-cost/convenience tradeoffs but rather on the choice of wording. In ad copy “inexpensive” is used instead of “cheap”, “value brand” instead of “cheap brand”, in surveys “concerned citizen” is euphemism for “unemployed”, etc. The difference between these examples and “pre-reclined” seats is that they do not lie but rather mitigate the negative connotation by choosing alternative words. On the contrary, “pre-reclined” is exactly the opposite of what the seats really are.  An NPR radio host commented that – to call a non-reclining seat a pre-reclined seat is as to call a crashed airplane a pre-landed airplane. IMO, the choice of wording adds insult to injury for the passengers who are already annoyed by the recently introduced carry-on fee. Whoever came up with the “pre-reclined” idea put too much marketing theory behind it and only managed to offend passengers’ intelligence. A “fixed seats so we don’t have to raise prices when everyone else does” explanation would have sufficed  for us to swallow the news, after all we are already accustomed to the trend of turning airplanes into Mumbai trains so this innovation was somewhat anticipated. “Pre-reclined” seat, however, is almost as asking us to be happy about it.

KFC’s Double Down – fat or fad?

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KFC Double DownOnce in high school, for lack of better things to do my friends and I tried to come up with the nastiest thing to eat. The only condition was that the ingredients are legit food items.  I think the winner was a sandwich made of two slices of pig fat spread with butter with a glass of cooking oil to wash it down—or at least this is the one contender I remember.

The memory of this pastime surfaced the moment I read about the KFC’s Double Down—a sandwich of two chicken breasts with bacon and cheese in between. Sure enough, CNN picked up the story the same day and put a quick vote – “have the fast food companies gone too far”, the food sections in most media are buzzing with the news and some health activists are going berserk.

I don’t know how (un)healthy the sandwich is, although perusing through foodies’ blogs it appears that it is salty, greasy and around 500 calories which is on par with most junk food meals, or even “inferior” in terms of calories. I know, however, that I will definitely try it soon. It is one of those things like the beer-milk shake in Steinbeck’s Cannery Row that you’d love to try if the occasion presents itself but wouldn’t mix at home for the sake of trying it.

I think introducing the Double Down is a well-calculated gamble on part of KFC. Today, when social responsibility is a major factor in the business environment, the DD chicken breast (pun intended) sandwich debuts as outrageous, over-the-top, how-dare-you, menu item that has the potential to become a fad in certain circles. Plus, in an industry where all players are moving in lockstep towards healthier meals, someone should stay behind and claim the pig-out category—KFC is the best suited player to do so as the F in their name stands for fried after all.

Hyundai – corporate vs dealership ads

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HyundaiLast night I saw a hideous TV commercial by a local Hyundai dealership. The opening frame was of rows of marching dollar bills in sync with the sound of marching army boots (did my best to find the video but couldn’t). Then it continues to a quick and dirty animation of a Hyundai car rolling on top of the bills with an overly exciting voiceover repeating frantically the dealership’s name and “lowest prices”.

 Something tells me that the “mastermind” behind the storyline was the owner of the business and his thinking was along the lines “If I’m throwing my money for TV ads, I’ll make sure I’ll hammer my dealership name in their brains by repeating it 3 times a second” Might be an overgeneralization, but most dealership owners are old-school businessmen with an I-know-best attitude, hence the abundance of cheap, out-of-line commercials on the local channels.

I like the Hyundai brand. I like their corporate advertising too – it appeals to my taste for logical reasoning and consistency and more importantly – it perfectly fits Hyundai’s aspirations. They are slowly but methodically repositioning themselves in a very competitive industry. To that end, this dealership ad did not do justice to the brand. I wonder how the marketing people at Hyundai feel about commercials like this one. Some manufacturers are doing better job than others in controling their message.  I know that Hummer, of all brands, had very strict rules imposed on their dealerships in terms of local advertising (albeit insufficient to compensate for bigger – no pun intended problems).

illy on sale???

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illyWhile shopping a few days ago I saw that illy espresso coffee was on sale. To keep life interesting I usually buy a different brand each time – Medaglia D’Oro, Lavazza,  Café Bustello, etc. but never illy since the price of $13/can is a turnoff. It is a turnoff not as an absolute value but relative to the prices of the other brands ranging from $4 to $6/can. So, when I noticed the big yellow sticker underneath the illy cans I squinted and moved closer to see that it was actually on sale for $12… I was amused more than anything else and wondered if this promotion was a manufacturer’s or a retailer’s decision (not sure what the arrangements between the two are). To me coffee is a commodity and not a product that satisfies hedonistic or charitable needs, although I’m willing to pay premium for a fair-trade or a local product within a reason. In my mind the “right” price for a can of coffee is a function of its taste and I don’t find illy to be twice tastier than Lavazza, for example. My point here is that the “P” that stands for Price in the marketing mix was off to begin with.  But let’s say that I’m not the typical illy customer or that I’m not the coffee connoisseur that would discern its fine aroma or aftertaste. Let’s say that the premium pricing reflects the positioning illy chose and works well for them. Then why the lame $1 off sale? A second “P” in the mix-Promotion goes wrong. Promotion is tricky for premium brands, it is often their nemesis. Why jeopardize your brand equity with a $1 off sale?  The $1 off sale could be perceived as a sign of weakness, an awkward price-adjustment, or worse – a cheap eye-grabbing trick that could only offend the sophisticated consumer. At any rate, I do buy illy espresso in the coffee shop at work and I do buy Starbucks espresso too. I like the latter better but they do not sell their espresso mix anywhere – smart move, IMO.

Chocolate wrapping

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Chocolate BarHow do most people open a chocolate bar? They place it upside down, open the wrapper from the back, tear off the foil and see what – a nondescript flat brown surface instead of the face of the blocks where the brand logo is. Companies such as Kraft Foods have plenty of consumer behavior analysts, industrial designers, ergonomists, and whatnot, so I doubt this fact never crossed their mind and yet, the chocolate bars are wrapped the way they are – i.e. with their back to the people munching on them. I tried to think of some obscure engineering/stocking/marketing reason for this, something like, “they cannot be fed in a vending machine”, or “they will be unstable on the shelves”, or “people are used to find their chocolates this way” but no plausible one came to mind.
All above is based on the premise that most people consume chocolate bars as described. While I’m sure that most people around me consume it this way, it might be that I’m surrounded by perverts and most people actually follow a different ritual when opening a chocolate. It would be interesting to conduct a disguised test on this: Invite a focus group to discuss healthcare reform and give each table a chocolate to share while talking.

5-hour Energy, packaging went wrong

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5-hour ENERGYI like the way 5-hour ENERGY clearly articulated their positioning and advantage over other energy drinks (RedBull in particular) – small in size and calories, robust effect. They are also running a very well devised marketing campaign, with massive media presence supported by wide availability and prominent in-store placement. With all this as a backdrop it is surprising to me how inappropriate the packaging is. The colors are fine, red, black, yellow, high-contrast combination that screams “energy”. The running silhouette on its own is seemingly fine, (although I think a less trivial picture would have been a better choice) but in combination with the shape of the bottle and the cardboard bottle holder it evokes associations with male-enhancement products and illegal steroids. I wonder if focus groups were conducted prior to adopting this packaging. I think it hampers the otherwise well-run campaign and prevents it from becoming a new category of a product.

Geico commercials

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I’ve been following the Geico commercials for quite a while and the latest theme made me think that there must be a more strategic way to manage their ad campaigns. Being owned by Berkshire Hathaway it is not surprising that they pour a fortune in TV advertising but it seems to me their ads are loosing focus. There are at least four distinct themes: “so easy the cavemen can do it”, “15 minutes could save you 15% or more”, the gecko and the CEO talking about trust, relationships etc., and now the one below. What is their value proposition? Easy to get a policy? Savings? Customer service? All of the above? Undoubtedly, if you advertise so aggressively you’ll gain some market share, but what is their ROMI in comparison with Progressive for example? Progressive’s ads are very focused, very consistent and with clear message. It would be interesting to hear what industry analysts can say about the two companies head-to-head.