Volkswagen to celebrate transition to e-vehicles, change company name to Voltswagen…

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April Fools!

While Volkswagen plans for at least 60 percent of its sales in Europe to be hybrid or EV by 2030, they are not there yet. Nor are they among the most committed to such a conversion.

Still, the company’s marketing group thought an April Fools’ joke announcement of a name change to Voltswagen might be fun. Unfortunately, it looks like a draft of the joke press release went out a few days early. Then the final “joke” went out two days before April 1. Read more about what happened in “Volkswagen of America said its name was changing. Now it admits it was just a disaster of an April Fool’s stunt.“

IHOP Publicity Stunt

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Over the summer one of the most talked about marketing campaigns was the IHOb campaign.  The International House of Pancakes announced they were changing from IHOP to IHOb and later announced that the “b” stood for “burgers”.  Shortly afterward they admitted it was all a publicity stunt to help build awareness of their line of burgers.  This campaign has potential for a couple of class discussions.  First, was it successful?  Clearly they succeeded in getting people talking about their company but whether it drove sales is more ambiguous.  This article from the USA Today suggests it did not drive a material increase in sales.  Another article from geomarketing.com indicates that there was an increase in male traffic but the net result was negative due to lower traffic by females.

Another angle to discuss is the ethicality of the campaign.  Is it ethical for a company to say “we’re changing our name” when they have no intention to do so?  Does this create a bad precedent or does it cause other companies to push the boundaries of deceptive marketing?  How far is too far when trying to gain publicity?

Promotion Through Influencers

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While many promotional strategies are ageless, to be most effective you need to know how to fine-tune your strategy for your target market.  If you’re targeting a particular age-group of individuals, you may be able to capitalize on generational trends.  Authenticity is becoming increasingly important to consumers, particularly to millennials and Gen Z.  This article, “‘This Is A Business Now’: YouTube Stars Influence Generation Z’s Fashion Tastes“, discusses how one woman, Rhea Park, took her interest in fashion and turned it into a business by posting videos of herself modeling and reviewing various outfits.  She has over 250K followers and those followers trust her reviews more than they would trust content found on the designer’s website because Rhea’s videos are perceived as unbiased and authentic.  In Chapter 16 we refer to this as Earned Media, promotional strategies not directly generated by the company or brand, but rather by third parties such as Rhea.

The Gray World of Online Reviews

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The internet has given consumers incredible power when it comes to evaluating and purchasing products.  No longer do you have to visit multiple stores to compare different products.  Visiting websites of multiple manufacturers couldn’t be simpler but it’s not just access to manufacturer provided product information that has changed.  Consumers have always been skeptical of promotional messages from sellers, rightly assuming those messages are biased.  That skepticism has given rise to the popularity of “unbiased” consumer reviews.  Go to Amazon or most other online retailer and you can quickly find product information provided by the manufacturer along with consumer reviews and ratings.  This desire for consumer to consumer reviews has become the entire business model for companies such as Yelp.

Individuals have also capitalized on this trend by posting video reviews on sites like YouTube or creating their own review sites.  When these sites rise in popularity their product reviews can have a significant impact on product sales.  Unfortunately this “free advice” isn’t always altruistic.  Recognizing the impact these sites can have has led many companies to try to woo reviewers and incent them to push their products over their competitors.  Trying to determine if a reviewer has received any compensation or incentives from manufacturers is often a difficult process as many reviewers hide that information or outright fail to disclose it.

The Fast Company article, “The War to Sell You a Mattress is an Internet Nightmare“, provides an in-depth look at these practices within the world of mattresses.  The article details the practices of online reviewers as well as mattress manufacturers.  Some of those practices might trigger a few ethical concerns.  For instance, Casper CEO Phillip Krim wrote one review site saying, “Currently you actively endorse a competing product on our review page. What can we do not to have you endorse another product as superior to ours?”  Casper goes on to offer free products, travel, etc. to convince the reviewer to give their product a better rating than their competitor Leesa.  These incentives and kickbacks create a conflict of interest for these independent reviewers and can compromise the integrity of their reviews.

Which side is right and which is in the wrong?  There are many sides to this issue which can lead to some great in-class discussions (or a written position paper).  This is also an opportunity to highlight the significant role publicity can play in a marketing strategy.

“We wanted [our restaurant] to be Instagrammable”

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Most industries report a decline in the effectiveness of advertising as a means to tell customers about their product. As we note in chapter 16, customers tend to place more faith in what real people say about goods and services they might buy. Apps, including the online review site Yelp and social media site Instagram, offer customers an easy and fast way to hear about other customers’ experiences.

Restaurants have long benefited from word-of-mouth (telling a friend about that “great meal you had at the new bistro”). Today, some restaurants are looking for ways to be more “Instagrammable.” Read more at this trend in “Instagram is pushing restaurants to be kitschy, colorful, and irresistible to photographers,” The Verge, July 20, 2017.

This article could be discussed at many different points in the semester. It offers an interesting example of customer value (chapters 1, 8 and 17); for some target customers, improving the “shareability” of an experience enhances the experience. For many young people, sharing the experience is part of the experience. It also suggests how consumer behavior (chapter 5) with social media (chapter 16) can impact new product development (chapter 9). After sharing this example in class, students could be asked: why are these businesses doing this? They are likely to immediately get that it fosters word-of-mouth, but may not readily connect with other benefits.