Monday 18 April 2011

Own brands v branded products - which one's the Finest?

Sainsbury’s has announced that is has embarked on “the single biggest own-label development” it has ever done as a business. Apparently 7,500 of Sainsbury’s standard own label products are being revamped over the next year to feature the new ‘By Sainsbury’s’ label.
The ‘own label’ sector has come of age. Long gone are the days when you simply bought a Sainsbury’s this or a Tesco’s that, most likely to save a few pence off the brand leader. Now, there are sectors within the own label sector itself. Tesco’s offers products across its Value and Finest ranges, Sainsbury’s pairs its Basics range with its Taste The Difference products, and even Waitrose got in on the act recently with the launch of its Essentials range.
The power of the own label became evident last Christmas when Waitrose enlisted the help of celebrity chef Heston Blumenthal to put his name to some of its own Christmas ranges. Thwarted shoppers turned to eBay, apparently bidding up to £250 for Blumenthal’s Waitrose Hidden Orange Christmas Pudding despite an rrp of only £13.99. Retailers have upped the stakes by revamping their own-label products and investing in strong-growth, high-margin premium products.
With retailers working hard than ever to give their own-label lines the cachet of branded products, own labels have become brand labels in their own right and in some categories have achieved brand leadership. But given that they not only offer extensive product ranges, they also own the major supermarkets, what are the longer-term impacts for established brands?
At a time when the price gap between branded and own-label products is lower than ever, you would expect branded products to be regaining ground. Yet, aside from ‘heritage products’ like Lea & Perrin’s Worcester Sauce, Heinz Tomato Ketchup and Coke and Pepsi, to what extent will branded products - established or new – be able to compete with own brand products in their own store environment over the next ten years?
Are we looking at a future where, with a few legacy brands aside, you will only be buying own label products from different own label premium or value ranges?

The reality is that established brands have been concerned with own label products for years and, although many manufacturers make those own label products, sometimes to a more successful recipe, the power of the retailer and its own label arsenal means that manufacturers are often searching for innovation that is harder for own label products to copy e.g. packaging innovation, or brand development via innovation or marketing.
But then, there is one retailer that is simply bucking the trend. For years, Marks and Spencer only sold own label products. Now it has started stocking certain brands like Marmite, proving that there can be a limit to own label domination if the positioning and the marketing of the branded product is so distinctive that there is no commercial advantage for an own label equivalent.
So, in that sense, this isn’t just any old blog. It’s an M&S blog.

Wednesday 13 April 2011

Back To Basics - Social media offers nothing if you don't get the fundamentals right

Simon Carter, marketing director of Fujitsu’s government arm, was quoted in Marketing Week as saying that marketers are becoming lazy by over-using social media and ignoring the skills and disciplines traditionally learned by marketers.

And we think he may have got it right. The Internet explosion and the seemingly exponential growth in social media provides enormous opportunities for brands to connect and engage with consumers. But at the end of the day it is just another channel to market – a powerful one – but just another one. Getting the most effective use out of social media requires the fundamentals of marketing strategy to have been conducted first.

This means identifying achievable commercial objectives and appropriate demographic groups, arrived at through effective customer insights, which are then used to inform strategic marketing planning. Only once the strategic building blocks have been put in place can you look at the tactical roll out and which channels or communications tools are going to be used to bring your proposition to market. Leaping right in with your social media – or indeed your PR, your direct marketing or your advertising – is like building something on shifting sands. It’s not secure and you can never be absolutely sure it’ll be there in the morning.

Some brands are so eager to leap on to the social media bandwagon that not enough consideration is given either to the synergy with the brand or product or whether the form of social media being used builds a bridge with the consumer.

We think that it’s important that social media is used as a natural part of an integrated marketing programme. Marketing this week reports on how Comparethemarket.com has almost defined the way to use social media with its ‘Meerkat’ campaign. Although the social media campaign was successful, this was only because it formed part of a well thought-through and well conceived marketing campaign brought to life by iconic television advertising.

Craig Inglis, director of marketing at John Lewis, is quoted in the same article as saying: “You should not let the channel dictate the communication. Start with the big idea then the media channel comes second.” He’s spot on!

Carter believes that social media has made some marketers less concerned than they should be about accuracy and targeting. Some marketers, he says, no longer worry about even getting email addresses right. “If something goes wrong it’s like ‘so what, we’ll send another batch of 10,000”.

True marketing, though, is all about targeting and messaging – it’s not always a case of reaching the highest numbers full stop. If you get the fundamentals in place, you’ll reach the numbers you need and your message will be more relevant and accurate for doing so. And that’s the key route to achieving brand cut-through – social media or no social media.

Thursday 7 April 2011

I’m A Celebrity…Get Me A Product To Endorse




Have you ever bought chewing gum because Ben Fogle told you to? Maybe your decision to treat yourself to a coffee machine was influenced by George Clooney? Or perhaps Kerry Katona and Jason Donovan lured you away from your usual supermarket to join the other mums going to Iceland?

Celebrity endorsement is an ever-present part of brand marketing these days but though the face may fit the brand at the start of the relationship, there can be any number of reasons why a parting of the ways becomes inevitable.

Gatorade, AT&T and Accenture all ended their association with golfer Tiger Woods following his admission that he had been unfaithful to his wife. And now Coca-Cola has ended its relationship with Wayne Rooney. The footballer’s contract with Coca-Cola expired last year and is not being renewed. Although Coke are focusing their promotional efforts on the 2012 Olympic Games, Rooney’s alleged infidelity and latest dalliance with authority by swearing into a television camera after a recent Premier League game wouldn’t have done much for his stock.

In a sense there is an irony to this. His alpha-male, total committed approach and attitude – all of which are cited as what makes him the footballer he is – chimed with the target market for Coke Zero, where the male-focused campaign built around no compromise seemed a perfect fit. Now, though, Rooney it would seem has taken the ‘no compromise’ just a little too far.

With the level of investment – financial and otherwise – in securing the right face for your product, brands are increasingly using research to determine if the 'fit' is going to work. And this means understanding your brand 'shape' and the correct 'shape' of the celebrity to promote it. A star who may be perfect for hair and beauty products may not be the right person to offer relationship advice, for example.

Testing the market perception of celebrity options is crucial, not so much for asking why a celebrity may be suitable for the brand, but as importantly asking why not. Ask not only what the consumer’s perception of the celebrity is in the context of the product, but also what their general opinions of that person are. The rest, to an extent, is a game of chance and ensuring there is a swift get-out clause for the brand in the event of celebrity misdemeanour.

It’s impossible to accurately say whether there is any retrospective re-interpretation of a brand when its associated celebrity goes bad. However, effective research can help highlight the risk areas and then swift action in the event of a problem can help minimise any lasting collateral damage.