Monday, December 21, 2009

Super Bowl Advertising, Smart Move or Marketing Gluttony? The Refreshing Pepsi Refresh Project

Recently Pepsi made the decision to not place any spots on this years Super Bowl, and instead are directing that money to Cause Related Marketing.

See WSJ Article

I think this is a great move for several reasons specific to Pepsi. As anyone who reads this blog I focus often on Return on Investment. I have a Sales/Finance Background. And while Advertising/Marketing has a big emotional component that the Creative's use to hook us on products, without Sales and Profits all the money spent marketing gets wasted. The one thing that the Industry has to deal with is the Elephant in the Closet we all ignore, especially the Sales/Finance folks (And CFO's this means you!). No matter how good the Creative's are I will use the well beaten saying 'You can't put lipstick on a pig, because it is still a pig.' Why CFO's think Marketers can do this I am still trying to figure out. As a Sales Person for many years I dealt with the same thing. Reality of the Product, or the Company.

And this is where the Pepsi story and the Super Bowl comes in. While we all love Super Bowl Ads because the brands compete to have the funniest, warmest, most memorable Ads that we will all talk about for a year, most of the brands are 1] known and 2] most people already have their view mostly set on that brand for various reasons. I love the beer commercials and can watch them over and over but I never buy Bud, Miller, or Coors because they are bland to me. Nothing they can do except give it to me for free will change that. The one group who are impressionable would be the 10 to 25 year olds who are still developing their views on what they should be identified with in their life, and this goes for most of the products that get advertised.

The one exception is New Brands, Products, and Promotions. The goal here is to get someone to try it....once. And hope they like it to earn repeat business. For launching new things the Super Bowl has superior reach to everything. Everyone is watching and everyone for once actually would rather miss a play of the game than miss a commercial!

So for Pepsi, most everyone has tried their products and has decided if they like them vs the competition. And I have mentioned before that Point of Sale in the store trumps a lot of Marketing spend. I am a Diet Pepsi drinker. When we stocked up for a Holiday Party the other day Pepsi had a big in store promotion so that is what we bought: Pepsi, Diet Pepsi, and Sierra Mist. Had it been Coke I would of chosen them because I am not rich, the deal was incredible (Two 24 packs of Pepsi Brands for $10 with a $25 purchase of other goods at Price Chopper Super Market) and I can settle. This covers most people no matter what soda brand you prefer unless money is not an issue.

I asked Rob Schwartz the Chief Creative Officer of TBWA\CHIAT\DAY Pepsi's Creative Agency if Super Bowl ads sell more Pepsi. He said, "The Super Bowl is more to keep a buzz about your brand in the Pop Culture Conversation." Talk about a hard sell to the CFO! But then he said, "The goal of the Pepsi Refresh Project is to do some good with our marketing money. The last thing the world needs is another Super Bowl ad. You can quote me for your blog." Now the CFO is listening.

So what will sway me? What will sway the average Joe and Jane out there if there is a price difference or none at all to buy one brand or another? Social Responsibility! But only when it is fully exposed and known, for good and bad. On a National Scale Nike, Walmart, Exxon have been exposed for bad practices in the Third World and had Non-Profits try to rally boycotts. Brands like Starbucks have earned praise for offering insurance to all workers, even part timers. Everyone knows about the Ronald McDonald House. Unless this is exposed for all to see (good or bad) there will be no impact. That is why Brands often don't market their own good deeds enough, and why Brands fight to cover up the bad deeds.

But if you do this on a local level, grass roots, this trumps everything. This is direct marketing at it's finest. If I know that Pepsi helped my community organization, school, park, hospital this could earn my patronage for life. Too many Brands write a check and slap their logo on a Social Cause and think that is enough. Most brands have charities they support. But very few people if asked can name the causes with brands. The best recent one of note was the NFL Breast Cancer Awareness Week for the Susan G Konem for the Cure weekend with many layers wearing pink shoes and accessories. I have also written about the Yoplait Pink Lid Program (which I didn't give a good review on).

So Pepsi is earmarking $20 million from their marketing budget to support local community programs and initiatives. But even more critical, they are asking Pepsi Drinkers to nominate programs for their support. This is true bottom up from the community sincerity. And that Super Bowl 'Buzz' Pepsi is giving up? There has been more articles and free publicity given to Pepsi already from this decision than they will get from the Super Bowl. And in return community programs in need will benefit.

The Marketing Sensei will revisit this program in 2010 to highlight the positive effects on communities and Pepsi's bottom line. The CFO will be pleased.

In wrapping up the Super Bowl Ad Buy view, I get it. It shows you arrived as a company. It will create a buzz. But it might not increase sales, and during tough economic times Brands should analyze how to get the biggest return for their marketing spend, because Sales and Profits are wonderful things. They help prevent layoffs, increase R&D and Marketing Budgets, and keep Share Holders happy. And even more important allow Brands to give back to the world like the Pepsi Refresh Program is doing.

Saturday, December 19, 2009

Subtle Startegy, Network Greed or Poor Media Buying

We have observed this, we are watching a program on Cable or Network TV and we notice one or two commercials are repeated so often that we actually switch over while they play because we are sick of hearing the same message. I am currently watching a stand up comedian on Comedy Central. I have seen in 45 mins the same I Pod Touch commercial 6 times and an I Phone App commercial 4 times.

So is this strategy on someone's part? To ensure the message is beaten in my skull. So that I get brainwashed into buying the devices.

Or is this greed by Comedy Central? Apple gave them money for inventory to reach a certain demographic and they are light on clients for spots on this show so they just keep plugging Apple?

Or is this poor media planning? Where someone isn't paying attention or not critiquing the performance reports they get from Comedy Central when they come in?

I know media planning and buying for a major national brand across all platforms is as complicated as curing cancer. But Apple spent about 30% more than they should of on spots during this 1 hr program. And as a champion of the brand with a Finance/Sales background I call it wastage.

Friday, December 11, 2009

Facebook, Privacy, OverHype and Bad Business Model

Facebook has just received a lot of flack (deservedly) for their efforts to expose (by force) more of the content people post to their website for all the worlds eyes to see. This is after the failed Beacon service, and other efforts to boost advertising revenue. As an advertising platform this business is significantly over-hyped by a few biased groups:

1] Facebook Employees and Investors - they want to cash out with an IPO then who cares what happens to the business.

2] Social Media Journalists - They are paid to write about social media and of course Facebook is one of the biggest. If Social Media fails to live up to the hype they might be seeking new jobs.

3] Social Media Guru's/Consultants who claim they can help you make bank using websites such as Facebook. Recently it was proven many ex-real estate folks have migrated to Social Media.

4] People who are employed by their firms to be the Social Media Manager - which can be frustrating but also very fun to work on. And who wants to go back to Accounting?

5] Hyper Hype! Facebook and it's promoters spout now 350 million accounts. Yet in August when they had 300 million there were only 92 million unique visitors per comscore. So why the discrepancy? Well I have 2 accounts. 1 personal and 1 for a service of my company Sky Pulse Media. And companies like USocial sell friends and fans by the 1,000's. So there has to be over 100 million zombie accounts!

So those are the vested interests in businesses like Facebook living up to the Advertising Platform Hype.

Considering Facebook is seeking to exploit it's users (community's) information and content to make money as an Ad Platform it really puts their business on the side of Advertisers and not the community who without they would not exist! Kind of like being on the Yankees and offered a massive contract but trying to earn money from the Red Sox instead.

Now I wish to state I don't hate Facebook. The technology is great. It can be bested since it lacks many, many things in terms of the format. But it was the first really simple platform for people to connect with each other. And this is why I get aggro on them. If Facebook took Apple's model and sold their technology to other businesses, or had a subscription model where Advertiser's be damned, then they would be on the same side as the community. It would allow them to do things in a walled garden that people would be willing to participate in more openly. And immediately they would be valued much higher than they are now.

But currently they use this news feed and live news feed as kind of their platform for brands and marketers to listen and reach the community. But just like with Twitter this stream is monstrous. Every time I log in I have 300+ posts I haven't read, of which I usually read the first 25. So over 275 posts I do not see. And 90% of all accounts that I check out are set to private. This proves people want the walled garden. So their business model is going against what the community will champion and as soon as a true alternative pops up people will fly away. If you think they won't social media is littered with the last great hype...Friendster, Myspace, Tribe, sites people spent considerable time developing profiles, uploading photos only to jump away when something better came.

So when I see this whacked out effort to go behind people in a weaselly manner to have them expose themselves more I am allowed to champion the community over the website. I use weasel because instead of having new settings and allowing people to change them...when the window popped up t automatically changed them and you had to change them back. And if your business is a reflection of your ethics, honor, and character then Mark Zuckerberg fails once again on all 3 counts.

Wednesday, December 9, 2009

Why Brick and Mortar will never disappear

Media Post Article

I read this article by Laurie Sullivan and really was blown away that anyone in the Ad Industry or Retail for that mater would think we would go all E-Commerce. She blew her thesis up front by saying there will be warehouses to go see/feel product, which if that is true we would need them all over the place (ie stores) and if we already are there wouldn't we want to buy what we like for immediate gratification? I am surely not going home then placing and order and paying for shipping.

But there are a few significant reasons why in person retail will trump online for the foreseeable future.

1] Many, many stores are small businesses and it would be impossible to replace these online.

2] We love exploring unique and interesting stores. And shopping is often enjoyable. And there is much less buyer's remorse in person.

3] Online reduces impulse buys considerably. When you walk into say a Target think of how massive your view is. Imagine changing that view to a 15" diagonal window. You will miss so many sale items and choices.

4] If something is close by and we can get it now we will. Especially if i is something we didn't plan ahead for. Like oops ran out of milk.

5] I can view the whole Cracker/Cookie aisle in 3 minutes in a Supermarket. This would take about 15+ minutes on line. I don't have time for that. And the actual physical packaging makes or breaks a sale. To get the same visual online I have to click on each item to blow it up.

One day it is possible that we might buy commodities or things we don't need to shop in person for online as routine. But until we can shop via hologram or HD-3D with the exact same visuals from our home, E-Commerce will accent not replace our shopping experience. While a store might make more margin on an item I buy directly from a website like my favorite shampoo I always buy, they would lose the volume of impulse buying that is proven from a 100 years of retail and marketing research and studies.

For items like clothes which we are getting used to buying online more and more, it really sucks when something doesn't fit and you have to wait to return it and get a replacement. And shopping for books is so much more pleasurable in a book store than online. You can browser titles and subjects so much faster. And it is very hard to replace that feeling of discovering something via the online experience. It is being worked on but nothing yet is close.