teachthe4ps.com » Product

Nike’s new marketing strategy

Joe Cannon — Wed, 07 Mar 2012 00:21:49 +0000

Every semester I survey my students by asking them to list their three favorite brands on the 4 x 6 card they fill out with personal information. Every year Nike is the most popular brand — typically mentioned 2–3 times more than the second place brand. Can you guess Nike’s prime target market? You got it college age kids.

Over the last five years Nike has significantly changed its marketing strategy – especially in product development and promotion. Following the phenomenal success of Nike+ with its all important (for Nike) target market of runners, the firm has invested in developing more digital products. While many of my generation (I am 51) recall Nike’s great television advertising, the company has moved almost completely away from the big screen, replacing it with small screen options with YouTube virally distributing longer (1 – 3 minute) ads and Facebook building relationships with loyal users. Fortune magazine provides an extended article describing changes at Nike - ”Nike’s new marketing mojo” (February 13). To read more Teach the 4 Ps coverage of Nike, click here. Also posted at Learn the 4 Ps.

This article might be useful to use when you cover new-product development or advertising and integrated marketing communications. For those of you using one of our books, you know that we use Under Armour (major Nike competitor) as an opener to our Product chapter. It might provide a nice contrast to discuss how Nike’s is creating new products that go beyond the shoe.

The Trick to Predicting What Consumers Want — You Don’t Always Ask Them

Joe Cannon — Wed, 29 Feb 2012 14:45:54 +0000

Scott Anthony’s new book, The Little Black Book of Innovation: How it Works, How to Do It has received great early reviews at Amazon.com (don’t you wonder if those few early reviews are just friends and family?) Those reviews and his post at the Fast Company Co.Design blog, “3 Ways to Predict What Consumers Want Before They Know It” have moved the book to my Audible.com library (so maybe you can wait for my review). The blog post has some great examples which will help you when teaching marketing research or new product development. The photo accompanying this blog post is of the ChotuKool portable refrigerator a disruptive innovation that targets India’s poorest households — I learned about it in the blog post. Anticipating customer needs takes a certain mindset, and besides the examples, I like that Anthony offers some practical “how to” ideas. Also posted at Learn the 4 Ps.

You might find this article provides good examples when you teach market research and new-product development — with at least one international example.

Some Success Stories for American Brands in China

Joe Cannon — Sun, 19 Feb 2012 18:20:35 +0000

Many Western firms have struggled in China — see Home Depot, Dunkin Donuts, and Best Buy as recent examples. Success, not surprisingly, revolves around effectively adapting a marketing mix for the Chinese consumer. Today I am offering two case studies that highlight how firms can succeed in China: the Oreo cookie (see “Rethinking The Oreo For Chinese Consumers“, Planet Money, January 27, 2012) and Starbucks (“Why Starbucks succeeds in China and others haven’t,” USA Today, February 10, 2012). The Oreo story highlights how the brand has changed consumer habits in China — teaching them how to open the cookie and as well as the practice of dunking cookies in milk (previously unknown in China). Advertising like the one below, featuring Yao Ming (former NBA star), was key to the campaign. Both articles share sales data that helps attest to the success of the campaigns.

These examples will play well when you cover international consumer behavior, product adaptation, and retailing.

Jenny Craig Responds to Rising Growing Obesity Problem in France

Joe Cannon — Sun, 29 Jan 2012 00:03:20 +0000

“France’s Unlikely Import: Weight Loss Centers” (Bloomberg Businessweek, January 12, 2012) provides an example of a cultural trend – growing obesity in France — and one firm’s adaptation to a new culture. The article also explains how another U.S. import — fast food (McDonalds and Pizza Hut have experienced growth in the country) helped France put on that extra weight. Jenny Craig has adapted its approach to French consumer behavior and palette. I know we just had an example of international product adaptation, but this one differs and covers a service and good.

Lego targets girls — again

Joe Cannon — Sat, 17 Dec 2011 20:08:34 +0000

Lego is the world’s most admired toy company. It hasn’t always been that way — back in 2004, the company teetered on the brink of bankruptcy as it lost a million dollars a day. In Basic Marketing we have a great chapter opening case scenario that uses Lego. This was one of my favorite openers to write. Bloomberg Businessweek‘s cover story “Lego is for Girls” (December 14, 2011) provides the latest chapter in this story. The article provides some insights on the development of the latest marketing strategy for Lego. This one targets girls. The article includes a bit of history – showing some of the toymaker’s previous failed attempts to appeal to girls.

The article provides some good examples for market segmentation (boys v. girls, differences in play across international markets), market research (researchers “embedded” with families to observe how Lego kids live and play), and product strategy (product design to appeal to girls). The result is the Lego Friends line of toys. Lego has put $40 million behind its global marketing effort. Still it might be a while before we know if this will work. Lego decided to wait until after the holidays to launch the new line. Given the importance of Christmas to toy sales, it might be a year or two before we know if Lego has finally cracked the code for the other 50% of the toy market.

Coke Pulls White “Save the Arctic” Cans After Market Confusion

Joe Cannon — Sat, 03 Dec 2011 20:47:05 +0000

It sure sounded like a great idea. The idea, draw attention to global warming and the plight of polar bears. The bears have been a Coca Cola holiday symbol for almost 100 years — so the actions also fit with the brand’s heritage. Coke did this by changing the iconic red cans to white for the holidays. It sure sounded like a good idea. Unfortunately, the new cans confused consumers — especially Diet Coke drinkers who confused the white can with their familiar silver Diet Coke cans. This article, “Bad News, Bears: Coke Pulls Back on White Cans in Holiday Campaign to Save Polar Bears” (brandchannel, December 1, 2011) describes many interesting elements to the story. For example, by monitoring social media, Coca Cola marketing managers heard complaints early. This case is also a demonstration of a low involvement product that consumers buy out of habit. In the end, it probably marks a mis-step by the soft drink giant. But I would say, if you take chance, you will make mistakes sometimes. And this whole outcome, like the New Coke introduction 25 years ago, may yet generate positive publicity for the brand. Also posted at Learn the 4 Ps.

This article has examples that can be used in teaching consumer behavior, market research, brand management, packaging, and advertising & promotion.

An Update on the Battle of the Brands

Joe Cannon — Tue, 29 Nov 2011 23:37:06 +0000

The battle of the brands is the “competition between dealer brands and manufacturer brand” (from our text books) over which will be more popular. Dealer brands, sometimes called private labels, are brands created by store chains (for example Safeway’s O Organics line of organic foods) and manufacturer brands are created by a producer (General Mills Cheerios). Dealer brands have been gaining share — boosted recently by economic downturn induced consumer price sensitivity.

This Bloomberg Businessweek article “Why Grocers Are Boosting Private Labels,” gives an update and some great examples. Dealer brands used to differentiate on price and then more recently offered comparable and sometimes higher quality. Now many retailers are adding brand managers and investing in more aggressive promotion. Surprising fact: in 2009, 8.7% of food and nonalcoholic drink new products were private label – by 2011 the number more than tripled to 31.4%.

The article will provide good examples when you cover branding and/or retailing. Also posted at Learn the 4 Ps.

It’s Not Easy to Out-Clever Apple, Does Samsung?

Joe Cannon — Fri, 25 Nov 2011 14:25:56 +0000

The iPhone has considerable market share and mind share among consumers. So how do you break into that market? Maybe you start by copying Apple’s iPad and iPhone. Then you try to differentiate your phone with a larger screen and 4G connection speed. Of course explaining technical differences in an ad can be a challenge.

So Samsung tries to make fun of Apple diehards with this latest ad. Does it work? I would imagine that Apple fans hate it and Apple haters love it — but those two groups are probably not Samsung’s target market with Galaxy (they are already too loyal). How does it work for smartphone buyers who are not strongly pro- or anti-Apple?

Either way, this is a good example of comparative advertising. Also posted at Learn the 4 Ps.

Online Retailers Look to Packaging to Enhance the Purchase Experience

Joe Cannon — Mon, 21 Nov 2011 15:28:08 +0000

Online retailers seeking to enhance their customers’ shopping experience are focusing on what’s in the box. In Basic Marketing and Essentials of Marketing we note three primary roles of packaging: promoting, protecting, and enhancing the product. This multimedia Wall Street Journal story (which includes an article, interactive graphic, and video) “Boxing Up Shopping’s Magic Moment,” (November 17, 2011, non-subscribers may have to click here) provides great reinforcement of all three roles of packaging:

Extensive testing of many packaging materials to assure that packages survive the trip from the retailer’s warehouse to the customer’s home in good shape.
Many online retailers are wrapping the inner package in a beautiful manner to enhance the overall experience when the package is opened at home.
The beauty of that inner package makes people feel better about the brand and promotes the next purchase.

This Wall Street Journal “package” offers a variety of examples you can use when you teach product or retailing. The video might work well in class because it is more than just talking heads and includes some nice images to complement the story. This was also posted at Learn the 4 Ps.

Harley-Davidson Adapts its Marketing Strategy to Ride Out the Recession

Joe Cannon — Sat, 05 Nov 2011 16:38:37 +0000

Harley-Davidson’s sales of premium motorcycles have suffered in the recession — falling more than 40% from its 2006 peak. Harley cut costs with more efficient manufacturing and labor cuts. It has also carefully adapted its marketing strategy. For one, the company is trying to broaden its target market — trying to lure women, minorities, young adults and people outside the U.S. It must target these new markets with caution; Harley doesn’t want to dilute its carefully crafted macho image. Harley’s marketing chief notes, “We’re not trying to be everything to everyone, we’re trying to be our thing to more people.” So Harley has adapted its promotion and products to appeal to new segments. This is not an easy task — and your macho image might be lost when riders look around and see a growing number of women riding Harleys. The article provides a nice example to use with marketing strategy planning for product or promotion. You could ask students for other ideas about how to adapt the company’s strategy for these new target markets.

You can read more about Harley’s efforts in this Wall Street Journal article, “Harley, With Macho Intact, Tries to Court More Women” (October 31, 2011, non-subscribers may need to click here). Also posted at Learn the 4 Ps.