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The QR in your future

April 11th, 2011

Got your smartphone handy?

If it’s equipped with scanning software (nearly half of all smartphone users have downloaded one free scanning app or another), point the phone’s camera lens at the QR code to be magically transported to a website featuring insightful commentary on contemporary marketing.

Quick Response codes are an exploding direct-to-consumer channel for selling, couponing, viral marketing, and, among the young urban technorati, hooking up. (“His QR t-shirt took me to his Facebook page, don’t you just love it?”)

Think of a QR code as a paper hyperlink. Think hard. This one’s not an if it’s a when – as in “When did those guys start using QRs to coupon against us?”

The Best Beer Commercial Ever?

March 28th, 2011

Is it just our reaction, or has the current wave of beer commercials devolved to the troglodyte level?

Whatever the brand, the spots are bar or party scenes in which the driving creative idea is: “You don’t drink Bud Light?  You’ll never have sex or move out of your mother’s garage.”

Research driven?  God help us all if that’s the only way to sell beer to American men!

We think it’s creative fatigue – a polite term for “the brand manager doesn’t know any better so why should we bother to think”.

In other countries, agency creative departments seem less fatigued.

We admit that it’s not a fair comparison because this Sapporo commercial is a two-minute CGI production for the internet.  Interweaving computer game themes, brewing, manly legends and contemporary lifestyle, it blows away young male beer buyers.

YouTube – Sapporo Beer C#191B7F

James Gleick on Packaged Goods

March 22nd, 2011

Science author James Gleick (Chaos, Genius, Faster) recently published The Information, a history and analysis of the systems humankind has created to comprehend our world.

It’s a brilliant book (someone will eventually find another adjective to describe Mr. Gleick’s works) that includes Two Wordbooks, a chapter devoted to historical linguistics.  This isn’t the intellectually radiant heart of the book (that would be the chapter on memes), but as linguists it floats our boat.

Beyond wondering why it never occurred to any of us that there was a pre-alphabetized world (with sequential alphabets but without the idea of using them to organize lists), the chapter seems to bear upon the management of identity in packaged goods marketing.

It tells the tale of Robert Cawdrey, a village priest who published a book in 1606 “for the benefit and helpe of Ladies, Gentlewomen, or any other unskillfull persons…whereby they may more easily understand many hard English wordes which they shall heare or reade in Scriptures, Sermons, or elsewhere…”

While this wasn’t the first book of English words, it was the first alphabetized dictionary.  The concept of organizing any list by notational sequence (a, b, c…) surely occurred to someone before Cawdrey, but this is the first recorded instance that has survived (via a single copy of the book in an Oxford University library).

Are we proposing that Dannon alphabetize its yogurt flavors in supermarket chill cases?  Maybe we are.

Gleick’s book is about the importance of information to human behavior.

Wine marketing is afflicted by weak information structure.  It’s clear that the chaos of wine identity drives consumers to other, more comprehensible beverage categories.

It seems impossible to us that the same eyes and brains won’t prefer a better-organized brand to a disorderly one.

Do you market soups? Detergents? Painkillers? Tampons?

Is your shelf of subtypes more clearly organized than the other guy’s?

Yoga for Brand Managers

March 14th, 2011

Close to 20 million Americans practice yoga.

They comprise an interesting audience for packaged goods marketers…75% are women, 70% are college graduates, 45% have household incomes over $75,000.

Unless you work for Lululemon – a yoga-focused apparel maker/retailer with $600 million in 2010 sales and a capital value of more than $5 billion – why should you care about a quasi-spiritual exercise regimen?  The reason is danshari.

Danshari is a basic tenet of Mahayana Buddhism, from whence most yoga practiced in America springs.  (Zen Buddhists call the same idea wabi.)

Danshari is a simple idea – life is better with fewer material possessions.  Owning more than you need is not only irresponsible in a world strapped for resources, it causes unwholesome complexity in everyday life.

Danshari has emerged from yoga studios as a lifestyle trend.  Beyond yoga magazines, you’ll see it voiced in various ways in consumer magazines from Real Simple to Vegetarian Times.

In our contrarian opinion, danshari is a new products opportunity.

The phrase “danshari products” may seem oxymoronic at first glance, but a little contemplative thought (our office yogista recommends the padmasana position) may reveal a pathway to revenue-generating enlightenment.

Sharing

February 22nd, 2011

We all learned in kindergarten that “it’s good to share”.

Converging ecological, economic and social motives underlie “collaborative consumption” – a term Rachel Botsman coined in What’s Mine Is Yours for a new trend with seismic implications for marketers of many goods and some services.

Consumers of all ages are using the internet to share cars (whipcar.com); sports gear and power tools (snapgoods.com); dressy clothes (swishing.com); parking spaces (parkatmyhouse.com) and even a place to crash for a few days (couchsurfing.com).

In the 1/31/11 issue of The New Yorker Patricia Marx’s The Borrowers describes a mixture of bricks-and-mortar and internet businesses offering short-term use and/or passing-on of everything from designer handbags to children’s toys.

Because in most cases the sharer is paid a fee by the user, business gurus write all of this off as a way to turn your inventory possessions into pocket money. As Bill Clinton put it, “it’s the economy, stupid!”

But to us it looks like more than that.

Consumer sharing has the flavor of a rejection of the reckless consumption of the past 3 decades.  Not only do sharers feel smart for renting a weekend’s camping gear for $20 rather than buying same for $200 – or earning $20 tax-free bucks out of that tent, pack and sleeping bag in the garage – they feel good about conserving the planet’s resources their transactions.

Consumer sharing also has the scent of an emerging social media category.  Making a friend online is easier when you have something in common.  Being willing to share, posting offers online, and the experiences you have in sharing are fodder for online socialization.

Craigslist.com is the father of reuse and sharing (maybe ebay.com is the grandfather); its booming progeny may well change the dynamics of manufacturing and marketing.

Energy Graphics

February 7th, 2011

The hottest new packaged goods category in the second decade of this century is energy drinks. For any marketing pro who’s just returned from an extended research assignment in North Korea, energy drinks are 80 to 320ml containers of sweet caffeine-laced fluids, many featuring a fashionable adjunct ingredient like acai, ginseng and/or gingko biloba.

In Japan, where the category originated more then 20 years ago, many brands feature heroic doses of B vitamins as well as caffeine (we suspect the FDA stands in the way of that strategy here).  Combining high unit price and very high volume, energy drinks are a huge business in Japan where this year’s hot product, Yunker Fanti, sells out its daily deliveries at ¥1600 (about $18) per 50ml bottle.

There are more than 30 brands on U.S. supermarket, convenience store, and drug store shelves. The volume leader is the Austrian-made soft-drink style 320ml  Red Bull.

5-Hour Energy, a made-in-Michigan Japanese-style 80ml brand (with an FDA-tolerable dose of B vitamins) is growing awareness and market-share.

Many of the brands in the field are cleverly named.  What’s strangely anemic are the package graphics. Selling the exciting promise of a jolt to relatively young consumers, package designers have been kept on a surprisingly short leash.

If we were product managers in the category, our package would look more like this illustration from an old German-language edition of Walter De La Mare’s ghost stories:

Supersaturated

January 26th, 2011

This wordless café sign in a stairwell on a Fukuoka alley may reveal an earthquake fault under Starbucks’ business model.

In Japan, as in America, Starbucks stores are so pervasive and consistent that they define the coffee urban experience.  That sounds great…at first glance.

A small café like this one is often a one-man operation run by a young owner who knows the young adult audience by being part of it.  Gaze at the sign for a moment and think about what the guy pulling espressos upstairs was thinking when he designed it.   Such a place doesn’t advertise.  The sign is its only way of attracting customers. What’s message did he choose to bring them in?

We think the sign says “not Starbucks” in no uncertain terms…and we suspect that this message attracts young consumers who think Starbucks coffee tastes fine but find the Starbucks experience boring because it is and (in their adult years) has always been the same.

In the café biz, Starbucks is a high-overhead retailer. They need a premium price to pay the rent.  Us packaged goods guys know that coffee is coffee – the price premium derives from the experience.

Seattle’s Best Packaging

January 4th, 2011

Our vote for the worst packaged goods branding is the wine category:http://www.namelab.com/blog/2009/02/the-worst-packaged-goods-branding-wine/, but premium coffee beans aren’t far behind.  Like the wine shopper, the premium coffee shopper is offered little useful information about how one brew differs from the next (half are “bright and lively”, half are “robust and full-bodied”).

Brand and type names are so obscure and packages are so unmemorable that it’s not that easy to grab another bag of the “pretty good one” you bought 2 weeks ago.

In our supermarket’s premium coffee section, you can pay anywhere from $8.00 to $25.00 for a pound of beans…but there are few cues as to why this bag is worth three times the cost of that bag.

In NameLab’s not-so-humble opinion, such marketing ineptitude drives a fair number of shoppers to the orderly, understandable, and lower-priced mainstream ground coffee shelves.

To exploit this mess, Starbucks has launched simple, meaningful, understandable Seattle’s Best packaging – numbers from one-to-five identifying “coffee levels” (punch, flavor plus other so far undefined qualities) – on the premium beans shelf. The new design’s large numerals and crisp, non-traditional colors leap out of the brown-dominated bean shelf array.

It looks like their idea is to persuade the shopper to “try the next level” – promoting exploration within the brand rather than from brand-to-brand.  Such exploration is also encouraged by the fact that they’ve made it so easy to find the one you bought last time if the new level doesn’t suit your palate as well as that one did.

Bravo Starbucks!  (You ever consider getting into the wine business?)

Do Packaged Goods Have A Future?

December 16th, 2010

It’s not a comfortable question for NameLab, but there’s  enough weight on the “no” side of the scales to make it necessary to ask.

Today’s 30+ adult has spent maybe 15 years using the internet to learn about everything from sex to laundry detergent. These are the core consumers we all chase after.  Their attitude toward laundry detergents is converging on “there’s not enough difference to justify a premium price for a specific brand”.

Shoppers aren’t abandoning brands wholesale.  Even among savvy consumers, comfortable familiarity moves the orange Tide package from the shelf to the shopping cart.  But most packaged goods marketers face steady consumer migration to store brands and generics.  While the shelf view is pretty, all the fish seem pretty much the same.

This doesn’t seem to be a temporary effect of hard times.  It showed up in segment research in the 70′s; grew some in the 80′s; accelerated in the 90′s; and shows no indication to slow down in this century.   It’s not merely a U.S. market phenomenon.  At NameLab, we don’t have access to data to suggest it’s worldwide, but we’ve observed similar consumer behavior in Japan.

Because defensive strategies are the order of the day, you find more and more national brands at far-less-than-retail prices in Wal-Mart, Costco and other discount retailers.

Offense would be innovation.  Not “new lemon zest” in soap products, but meaningful new features and radical product ideas.

Package goods isn’t dead, it just needs a few companies like Apple to get consumers interested in brands based on important new products.

The Death of Retailing

October 28th, 2010

Retailing had a good long run.  It was fun while it lasted.  But it’s over.

A world where few purchases are made at physical stores?

Think about it…

-Consumers learn about products in great detail from manufacturer or etailer sites, with ratings, cautions, and opinions at increasingly wiki-like mass-input product info sites.

-The declining world economy (a long-term situation economists now call “the new normal”) is diminishing the scale of retailing.  For cost efficiency, there are fewer SKUs – soon we’ll have to make do with 30 styles of red stilettos rather than 300.

-Conspicuous consumption has become uncivil, our new lifestyle is “blending in” rather than “keeping up with the Joneses”.  To quote a line from a previous LabNotes: In this new pattern of social behavior,   profligacy has become…thinking hard here…what’s a word that combines “dumb” and “impolite”?

-Delivery systems like USPS, UPS, and FedEx have become more efficient as they’ve scaled up to meet home-delivery demand.

-Daily food no longer requires bought and stockpiled ingredients…these days it’s take-out, delivery, or eat at chain feed troughs.

-Complex, fast-evolving electronic products are far better suited to internet sales than retailing.  (Other than the Apple Store, part of a uniquely closed products and services ecosystem, mall electronics stores are fading away.)

-Mobile phones that transact with vending machines will cause those machines to proliferate.  Because every consumer will have a mobile phone, they’ll buy picture hooks, pantyhose and pajamas from a nearby machine.

-As retail margins and sales volumes have waned, corporate managers have been cutting costs: dimmer lighting, fewer window cleanings and tightening the wage and benefit screws on store employees.  So the register clerk you’ve waited longer to come face to face with is more likely to be the type of passively hostile, minimum-wage “sales associate” you’ll buy your next shoes at Zappos.com to avoid.

Now for the good part (for us brand pros anyway).  On the internet, your brand is the universal icon of what you are and what you sell.  Without the distraction of adjacent shelves of similar stuff, that icon is pure and potent on its web page.

Never has branding – especially the “good behavior” that underpins online brand value – been more important.