True Christmas Spirit Thrives in Recession Battered Brand Britain

Last year we published a qualitative research study that showed how Britons were rejecting traditional consumption and wanted to use Christmas to reconnect with the things and people that mattered most and are closest to them. A year on and the evidence suggests that this remains the case as Britons look more to the simple things that encapsulate the spirit of the season, rather than a more naked, commercial approach to Christmas. It is interesting to see how brands and retailers have been using these insights to inform their product and marketing campaigns. Consumers continue to view this Christmas as a buffer against a painful present, a time to recharge batteries, and to reconnect with matters they view as genuinely important. While they do this, they are perhaps thinking more about practicality, planning and early budgeting than last minute magic and spontaneity, at a time when thrift has become more than merely a lifestyle choice. Such insights are also reflected in Christmas advertising this year as Waitrose presents us with a stripped-back television advertisement, for which Delia Smith and Heston Blumenthal have both waived their appearance fees (instead the cash will be spent on Waitrose’s Community Matters charity scheme). John Lewis’s advert, which follows last year’s epic, features the tag line "Give a little more love this Christmas", features a snowman searching for the perfect present for a mystery recipient whose identity is not revealed until the final scene (whilst the choice of “The Power of Love” for the soundtrack should not be overlooked), and ASDA, which supports the contribution of mothers, with the strapline ‘Christmas doesn’t just happen by magic’. ASDA said that the ad reflected the fact that for mums, despite the pressure, their big reward is looking back at the end of Christmas day, at a happy and smiling family, and thinking ‘I did that’. So the themes of Christmas this year are modesty & homeliness, intimacy & love. In the midst of all this Christmas spirit, consumers are making savvy decisions and feeling good about it. Greater effort will surely be invested this year in finding a bargain or in doubling up vouchers, finding a discount code, collecting and using points across all purchases, really checking deals in order to make hard earned money work harder and go further. Recent research by first direct found that 58% of people are looking to save money on the perfect party outfit over the festive period with women more likely than men to shop for a clothes bargain (60% versus 49%) - and more than three-fifths of them get thrifty when it comes to their party attire compared to half of men. The most common ways of saving money, according to the research, are shopping around more than before (46%), using discount codes or vouchers (31%) and retail reward points (29%). Christmas is still about enjoyment and escape, and a certain degree of excess is traditional but, in keeping with the subdued times, the sense of modesty and restraint reported by our respondents last year remains the order of the season. In spite of the jubilympic summer (or perhaps because of it), Christmas 2012 will be a contained affair in many families and so The conclusions for brands appear to be the same a year on: articulate hope and a positive long term vision as consumers are looking for inspirational light at the end of the tunnel; reflect the way that consumers have, in some ways, temporarily lost faith in materialism and focus on values rather than things; focus on the local, facilitate family, be active in communities and, at very least, continue to overtly support the British economy with products created and built locally. Brands should continue to tap into rituals which offer familiarity, comfort and trust for consumers and create promotions which reward planning and effort, as well as “hard to ignore” deals.

Is government plan really a green light for healthy food?

The government has announced that a ‘consistent’ system of front-of-pack food labelling will be introduced next year. This will be based on a traffic-light system showing consumers a combination of guideline daily amounts, colour coding and "high, medium or low" wording to show how much fat, salt and sugar and how many calories are in each product. The move comes after years of opposition from the multiples to a standardised labelling system. Their argument was that labelling was too simplistic and maybe unfairly critical of some products. However, some, including Asda, Sainsbury's and Waitrose, already had their own versions, which others claimed were causing confusion in the market. The government has said, though, that the new scheme will help people choose healthier food options and make more sensible decisions about what to buy. Their hope is that small changes will help reduce the scourge of obesity and improve the health of the nation. But will it? Traffic light labelling is a small step in a positive direction and there is plenty of data to show that grocery shoppers like this style of labelling and find it helpful. Research published last year by DEFRA showed that 80 per cent of people rated health as the most important factor affecting their buying decisions. Most shoppers – 82% - said they actively sought to buy healthy foods. The figures also indicated, though, that people’s preferences don’t always match what they ultimately buy, with price being a major factor in many people’s buying decisions, especially in the current climate. In practise, though, anecdotally it would seem to be further down our list of priorities. However, too much research focuses on one issue - such as labeling - in isolation, rather than looking at it as a whole. One of my colleagues undertook research some time ago with housewives, where each was asked to compare their last supermarket shop. With all of the produce on the table, they discussed what they had bought and why. They became quite competitive and in their efforts to win their impromptu 'supermum' competition, they became strong advocates for their products and the discussion was highly revealing. Health was rarely part of the argument. Price, offers, quantity, shelf-life, convenience came first. And then even when health is considered, the consumer definition of health is still poorly defined. In recent research we undertook, mum spent far more time than you would think possible trying to decide whether potatoes counted as one of your five a day. Milk - vital for child health - is too often restricted because it is seen as a high fat food (even though full fat milk is still only 4% fat). Most of them end up aiming for a balanced plate and call it a day. It is going to be important to ensure that the consumer is educated to understand the information behind the labelling. A knee-jerk reaction to a product with a red label on it could be counter-productive. The word ‘fat’ on a product could turn off the consumer, even though some fat in a diet is essential. Similarly, most products will contain an element of sugar, but some from natural sources like tomatoes rather than synthetic additives. Brands are going to have to adopt a more holistic approach to health; ingredients may not be enough. Brands and retailers may have to work together to create a well-being experience which may involve the in-store experience - display, promotion, training and product presentation – as well as the brand itself. There is evidence of this in some areas. Many multiples have revamped the way they display fresh produce so that it has a more market-like, natural feel and there has also been a move in the UK to balance the consumer’s desire for prepared meals with "semi ready-to-eat" meals. These products, with fresh ingredients that you can see when you buy them, are ready to take home and cook rather than just warm up. Tesco’s has had success with pre-prepared vegetables and meals in its Finest range as well as its City Kitchen prepared meals. However, Finest, City Kitchen and those like them remain premium brands. So now that we are finally getting a universal and comprehensible labelling system, maybe it's time for brands to look at the wider context of healthy eating and be able to demonstrate to consumers that you can buy and eat healthy products on a budget.

Deck The Malls….It’s October!

Are you in the Yuletide mood yet? Thought not. Christmas decorations and lights have already gone up in Nottingham’s Old Market Square this week and it’s still a good fortnight until Halloween; Christmas Trees have been available in John Lewis since the start of the month, whilst the BBC will film its “Songs of Praise” Christmas special on October 24th. And if you thought that was early, they will film the Easter special the following day. As Loudon Wainwright III sang: “Suddenly it's Christmas, right after Halloween. Forget about Thanksgiving; It's just a buffet in between.” So has Christmas arrived earlier to fill the post-Jubilympic gap? Are retailers trying to keep a low level of celebratory consumption bubbling in the background with crackers & cauldrons competing? Whether Christmas is indeed arriving earlier or not, one thing is for certain. Throughout the recession, talk of an austerity Christmas has never really come to reality as families have saved and stockpiled to ensure they have the best Yuletide season they can. The same will be the case this year. During what has been an undeniably tough few years, many people have clung like limpets to calendar staples like Christmas and Halloween as opportunities for an escape from everyday drudgery. It’s arguably one of the reasons why both the Jubilee and the Olympic Games inspired such overt public enthusiasm and excitement. But if we have clung to such events, so have brands and retailers, placing most of their hopes on a consequent economic bounce. That may be misplaced given that any post Jubilee/Olympic lift seems to have been transitory. Alternatively we may be heading towards an economy that simply bases itself on lurching from one special occasion or set-piece event to the next and just takes the economic benefit of each as they come along. The challenge for brands is to understand who is buying and for whom, what is influencing those purchasing decisions and to be able to respond to changing attitudes and behaviours in a way that enables them exploit whatever potential exists. This is where the use of online research and its ability to deliver insights quickly can assist brands in re-pointing activity fast, rather than having to wait ‘til the following season to implement slower moving research findings. Engage has also been creating more “experiential” qualitative research to transport consumers to a different mindset – useful for “out of season” research. Understanding how, where and why the shopper is buying is should be central to a merry Christmas for brands. The multi-channel shopping environment, of course, could also mean that Christmas may be less evident than when we shopped in a purely bricks and mortar world. Royal Mail reports that 40 million people shop online for Christmas gifts. This, coupled with the efficiency of high street retailers in terms of getting stock into store, also means we seem more comfortable buying later in the year than ever before. The propensity for retailers to start their January sales pre-Christmas means that more and more people are waiting as late as possible in order to bag a bargain. That also means it’s harder and harder for brands to calculate their own Christmas figures, particularly if they are forced into promotional or discounting programmes. Figures from 2009 found that nearly one fifth of Britons left at least part of their Christmas shopping until Christmas Eve, with Selfridges saying that around 80 per cent of its customers on Christmas Eve were men. So in these uncertain times it’s nice to see that some things don’t change.

Is Crowd Clout here to stay?

In the last few months I’ve joined the Groupon crowd. I used the discount voucher site to treat my wife and daughter to a pamper day and sent my son off drift racing at Brands Hatch and all, I’m told, at a fraction of the cost of booking it independently. They were happy and so was I, enjoying the benefits of crowd purchasing or ‘crowd clout’ which delivers compelling offers to consumers on a daily basis. And it’s big business as the rise of rivals Living Social and Wowcher has proven. Even Amazon has now launched its own daily deal website in the UK, beginning with London, where AmazonLocal will email geographically-relevant offers to users every morning, and offer reward points to those using an Amazon credit card. What’s more interesting, though, is whether this is a passing trend or one which will redefine the way we, as consumers, begin to purchase any number of items. In this, though, the signs are not positive. To do so, the benefit has to be as evident to the supplier as it is to the consumer and the intermediary and that is where the jury remains out. We know it’s big business – so far. Sales at Groupon exceeded $750 million in its first two and half years, whilst the company’s activities cross four continents and reach nearly 40 million subscribers. However, after the publication of worse than expected financials recently, an analyst at Citi Investment Research suggested “a rapidly deteriorating core business - ie the daily deals business - and Groupon needs to act fast to fill up this hole with new initiatives”. The company believes that growth may likely come from new services including an instant mobile deal feature; Groupon Goods, for deals with national retailers; and Groupon Getaways, for high-end travel deals, but only time will tell if the model will serve vendors as well as it serves consumers. The interesting thing about daily deal sites is also the extent to which they change not just the products that we buy, but the classic decision making processes we use - does the increase of impulse buying of things that we hadn't previously thought we needed, just because they are a bargain make us more rational and careful in our regular grocery shop, to balance our frivolity; or less so, because we have a taste of bargain spontaneity? What is sure is that now the initial excitement of daily deals has died down, they are going to have to be much smarter to survive. At the moment, they feel a bit like a particularly manic jumble sale, where you have to rummage endlessly though rubbish to come across the odd, only slightly soiled, bargain. And who wants to do that? Classic example of this is the juxtaposition of increasingly unlikely products - I saw cheap wills being offered just above bikini line lasering the other day - that is crazy. And some things should just not be offered on a special deal. Long-term it could impact on the service industries in particular. Services that pre-Groupon were too expensive for the majority have now decreased radically in price, because of the number of Groupon offers available. Daily deals could continue to stimulate consumer spending and help businesses - but they need to start working in a more sophisticated, thought-through way, if they are to do it. But, and it’s a big but, a study by Rice University in Houston, Texas, found that 40% of companies which had used Groupon to promote their goods or services said they would not consider using Groupon again. Presumably, although suppliers pay a significant premium for the service, they would be happy to do so if it were delivering sustainable custom. The findings from the study are interesting. Two thirds of customers won’t buy more goods and services than are offered in the deal; only one in five Groupon users becomes a repeat buyer, and 80% of Groupon users are using the site for the first time. Like me, they are often for sporadic, opportunistic purposes as treats or for gifts and I, like many I suspect, pay little attention to the name and nature of the business I am buying the services from. I pay even less attention to the torrent of emails that rain down on me and others and which actively turn me away from becoming more engaged with the site – more grouped-off than group-on! All this seems to suggest a pattern of short-term relationships between the vendor and the consumer and, consequently, short-term relationships between Groupon and the vendor. And, if the old adage is correct, that it costs five times as much to win a new customer than to retain an existing one, crowdpurchasing sites like Groupon are failing to secure long term relationships with vendors because they are not yet delivering enough sticky, repeat business for them. Increasing and broadening the opportunities for consumers, which would then in turn increase and broaden the benefits for suppliers would likely increase sales and embed crowdpurchasing as a way of moving forward, even for opportunists like me.

Will short term discounting harm brands?

Heavy vouchering and discounting have helped end 18 consecutive months of declining volumes for retailers whilst promotional activity has remained unchanged at 35% of FMCG sales, following continual use of money-off vouchers and coupons. Although this is primarily a retailer initiative what are the implications for brands in being discounted? How can brands maintain perceptions of quality if you're being discounted? What are consumer views? Is this the thin end of the wedge where the only way to sell is going to be heavily promoted or discounted? All of us, of course, have brands that we are likely to buy no matter what; discount or no discount those products will continue to find their way into our baskets. But they are probably in the minority. We are in a phase where brands will need a compelling proposition for not discounting or for remaining at a premium within their category. However whilst discounting may persuade consumers to try something new, it is unlikely to lead to sustainable business unless the products deliver as well as offer a better experience than their competitors. The challenge for brands is to retain those consumers without retaining the price reductions. Discounting, of course, doesn’t need to be quite so overt. There are 'brands' that discount more discretely but equally successfully. The secret hotels on lastminute.com, the 'shopping clubs' or Groupon style offerings can help bridge the gap between getting sales and occupancy up whilst avoiding brand equity erosion that accompanies continual overt promotion. This works online too with sites offering large discounts on higher end fashion brands. To many, this makes premium brands more accessible without feeling like they are compromising on quality. Whilst it doesn't necessarily impact on how they feel about the brand it may elevate how they feel about themselves. This can rub off on the brand by association. There is also, though, a more pragmatic view of discounting. Whilst if you are a premium brand, being constantly discounted might eventually tarnish the premium positioning, this will (in the current climate) be more than balanced by consumers' delight at bagging themselves a bargain. In fact to not be discounted could be perceived as brand arrogance, as if you are out of touch with the problems of your audience. For FMCG brands, premium often equals a touch of affordable luxury, a small treat to brighten your day so frankly the danger of undermining your quality perception through careful promotion is probably quite low. What might be an issue is who the discount is attributed to - as a brand you will be paying for the promotion, but the retailer will probably get the accolades and be seen as the shopper’s friend. So it might be important to communicate to consumers that the brand is responsible for the promotion rather than the retailer. Brands should perhaps take note from politics - it is important to demonstrate to people how you share their pain, rather than telling them we are all in this together and retreating to your ivory tower of price premium.

When branding becomes more than just a game

Picture the scene. You’re relaxing at home, catching up with friends on Facebook, playing a game, doing your best to escape from the realities of the outside world. You need to earn a bonus to move yourself up to the next level and just as you’re about to do so, a brand pops up on screen and offers to provide it for you. Irritating or inspired? Well, soon we may have the opportunity to find out because the move into the gaming sphere represents the latest response by advertisers to embrace new techniques to ensure that their advertisements are noticed. Not only has Amazon announced that it is going to start creating games in a bid to earn itself a slice of the $6.2bn social gaming sector, but one of its competitors in the field, King, is to introduce a new in-game ad format that will allow brands to pay to associate themselves with boosts or extra lives. It is easy to see why this could be tempting for brands. King claims that advertising across its gaming network could help brands reach over 30 million, predominantly female game players across Europe and the United States. But how will we, as consumers, feel towards this latest potential move by brands into another area of our private lives and leisure time? We have become accustomed to using technology to bypass advertisements and sponsorship messages, most obviously through the ability to digitally record television and then fast forward. However, when it comes to television or radio, consumers are generally passive, compared to gaming, when they are arguably at their most active. The key, I suspect, will be in the role played by the brand in-game and how heavy-handed that branding might be. Relevant in-game branding - for example a sports brand being represented within a sports stadium environment would seem to be a pertinent even subliminal fit (though the advertiser may argue “too subliminal”). With exposure this subtle and fitting, we would anticipate that it would enhance consumer perceptions of the brand. Research has, in the past, supported this view. An IAB survey in 2007 found that 86% of gamers were happy to see ads placed within games if it brought down the prices they had to pay, whilst a third said they would be either quite likely or very likely to buy a product they had seen advertised while playing.Only 14% said that ads ruined the gaming experience. Interestingly, 40% said that ads in games made them more realistic while 27% said that interacting with a brand during the game, such as gaining more energy by drinking a can of an energy drink, did not constitute advertising. However, if the brand is repeatedly associated with an event within the game that itself becomes frustrating, the player’s perception of the brand is likely to suffer by association. If in-game advertising is realistic, contextual and non-intrusive, it offers great potential to brands. But, beware, because if you get the context wrong, the downside for the brand could be significant.

Do we need an Olympic ideal for business?

Tell the truth, you must have taken a step away from your work for a few minutes at some point over the past week to cheer on Bradley Wiggins, Chris Hoy, Mo Farrah or Jessica Ennis, or perhaps just as importantly to cheer on and admire the athletes who may have missed out on medals but have achieved personal bests. But does it, can it and should it have the power to inspire us in our business lives and, if so, are we harnessing it to best effect? It has clearly had an effect on one of my colleagues at Engage Research who admitted having Bradley Wiggins firmly in mind as she cycled to work, achieving a personal best by knocking a couple of minutes off of her usual commuting time. The reality, of course, is that the Olympics are transient and, come September, will be little more than a happy summer memory. Many brands will already have found ways to tap into the current mood of hope and inspiration, to promote the Olympic ideal of being the best you can be. However, soon we will return to the reality of our economic circumstances, in which case some of the traits that set an Olympian aside could be transferrable to a business environment and could have a positive impact on the way we work. · Leave no stone unturned in your preparation – research is critical to the way brands and businesses function. As the saying goes, if you fail to prepare, you prepare to fail. Securing the customer insights your brand or business needs will be central to your chances of success. · Take a risk – the great athletes, like the most successful businesses, take calculated risks. They know the importance of seeing the main chance when it presents itself and then going for it. · Relentless self belief and enthusiasm – the top athletes will not allow themselves to be battered by negativity. If we don’t believe in our brands, nobody else will either. · A desire to stand out from the crowd – nothing will undermine your brand more than becoming ‘wallpaper’. Creating a distinctive identity with which your market can relate is crucial. · Agility – there is ample evidence of successful brands recognising early that something isn't working and then changing their strategy accordingly. · Being part of a team – you only need to watch a successful relay or rowing team to see the importance of assembling the right team and then playing to the strengths of each of the members. · Get used to disappointment – whether you’re an athlete or a brand, get used to the ups and downs and learn how to ride both to stay ahead of the competition. It’s always been very clear to us that you get out what you put in, if you simply let things happen then you'll get left behind. So be inspired and, when it comes to your own business, hopefully you won’t have to wait four more years to enjoy the fruits of your labour.

Preparing your brand for a ‘new world order’

The times, as Dylan once sang, they are a changing. Waitrose has just reported record sales of product via its click & collect service, whilst industry bible, The Grocer, have been reporting that supermarkets have not only been ramping up their Click & Collect services but are also now looking at extending it to non-food items. The publication suggests this could herald the dawn of the grocery drive -thru. This may seem a peripheral development for brands, being as it is more closely connected with the relationship between retailer and shopper, but there are implications and factors to consider. If there is an increased or steady move away from in-store shopping towards delivery or click & collect, product packaging may need to be adjusted to take this into account. Implicit in packaging design at the moment is the combination of front of pack short cuts with more detail on the side and back of pack which are intended to be more actively read and consumed by people who want to know more. If you are not physically seeing the product, you will not have access to this greater detail, the absence of which could influence your choice of brand. This is unlikely to have much of an implication for products that either do not require considerable thought or brands so instantly recognisable as to need more detail (e.g. Kit Kats, Whiskas, Tiger beer...). However, transfer this to a pro-biotic yogurt or a cholesterol-reducing low fat spread, where the choice may require more active thought, then the way the product is presented online versus on-shelf may well impact on how people shop in these categories. By replicating on-pack information but purely as text on a web page, makes it appear strangely out of context and leads to interaction with the brand, without actually seeing any of the branding. More often than not, all you get is a picture of the front of pack. This lack of product shots is a missed opportunity when you are dealing with consumers conditioned by Amazon and Ebay shopping to expect photographs of every single product component from every conceivable angle. We constantly hear from consumers that they like see-through packaging because they like to see what they buy. And often clients can't deliver that because of cost and technology constraints of making that sort of pack. But online they can do it every single time. Yet few do. And then there’s the unpredictable way products are described. A search of salad dressings produces this enticing product description for a Mary Berry product : “While every care has been taken to ensure this information is correct, food products are constantly being reformulated and nutrition content may change. We would therefore recommend that you do not rely solely on this information and always check products labels !”. Whilst other brands (e.g. Green & Black chocolate) have OTT product description essays which surely no consumer will ever read. So brands will need to give active consideration to how their products are being represented in the online shopping environment (size of the image, product details, juxtapositions) as new rules will emerge about how consumers’ respond to new brands or even brand extensions.

Maybe we will have more fun as we get older….

There’s no denying it, we’re getting older as a society. Only last week figures released by The Office for National Statistics showed that the number of people in the UK working beyond the state pension age has almost doubled since 1993, to stand at 1.41 million in 2011. Of course, this growing and ageing population not only puts pressure on more people to work longer, it will put pressure on brands to give greater consideration to how they address and exploit this fast growing demographic. After all, not only are older people likely to be the ones with most readily disposable income, they can be key influencers on both the choices made by their parents and their children. Key to brands could be our changing aspirations and expectations as we get older, as well as our income. Those of us who will work some way into our previously planned retirement because our pensions or our savings had turned out to be inadequate may become miserable and reactive against spending money for fear of running out. This group could end up being of little value to anyone outside of the alcoholic drinks sector. But there will also be those – and hopefully more of them - who do have enough money for themselves, but who will either have to or choose to stay at work because of their children. We know that children are living at home for longer and more children are staying in education, so a lot of parents are having to support them long after they should have flown the nest. It is interesting to note, though, that whilst the concept of an extended family all in one home is seen as a negative here, in some cultures, like Italy, for example it is more of a norm. Arguably this leads to less stigmatisation of those in old age. These developments have placed an added burden on people as they reach their 50s and beyond whilst some may also be having to support even older parents of their own. What makes this group interesting to brands is the enormous breadth of categories they either spend on or act as gatekeepers for. The economic situation is behind much of these newer developments. The Daily Mail recently reported on the rise of "helicopter parents", who having paid of the education of their children and now making a greater financial contribution to their further education, feel they have a right as well as a responsibility to "hover" in their kids' lives and be part of their decision making processes. Many of these “pensioners” will still be “young”, or at least younger than they used to be in terms of health and outlook. Their need to continue in work may well turn out to be a good thing as it minimises the risk of becoming lost in retirement, which in turn will maintain their desire and ability to exercise their purchasing power. This could be good news for travel, lifestyle, automotive and food and drinks brands for a start. The key, though, may be for brands to recognise these developments more overtly than they have to date and be less focused on the young, beautiful demographic. The figures suggest it could be time for brands to focus their messaging more clearly on the over 50s and not restrict it so obviously to age-related products, like healthcare, insurance or dareisay it, even funeral plans. Where’s the fun in that?

Cracking the codes of value

Value is centre stage again and Tesco’s recent replacement of its iconic blue and white striped range as a more comfortingly retro-packaged Everyday Value range has changed the rules. But how? We decided to dig deeper, by applying a semiotic eye to the way that the major supermarkets package their “value” ranges. The first thing that even a cursory semiotic skim tells us is all these ranges are missing the customary “brand adornment” (photography, benefits, serving suggestions, extensive colour palettes...); we see a plethora of products with white backgrounds, simple retail master brand colourways, “handwritten” script fonts, line drawings of products. So one of the key rules of value range packaging – it is all about absence. The “conventional” meaning of this is that no money has been spent on anything other than hygienic containment of the product and basic information – stripped down to give you, the customer, best value. But Tesco’s decision to break the rules and opt for a “de-stigmatised” design quietly breaks this rule. It reminds us that being able to afford the unnecessary adornment of branded packaging is central to the pleasure of consumption, of buying what I “want” rather than what I “need”. So, in contrast to Sainsbury and Asda who remain loyal to the puritanically stripped down approach, Tesco has decided that its value shoppers can have their Everyday Value cake and eat it, without being seen as “too poor to choose”. But (like the playfully redesigned M-Savers from Morrisons) it remains, recognisably, a value range. The Tesco range also breaks the “standardisation” rule. Products in the Everyday Value range do not carry exactly the same livery – yes, they are recognisably of the same stable but use different colours, have different product shapes. This provides just enough of a sense of visual variety for the products to provide some of that “unnecessary” adornment needed for proper consumption. What’s more the visual style and the product shapes have a loosely retro style and so connote a bang-on-trend simpler time of housewifely thrift. At the other end of the value market Waitrose essentials range conforms to many classic value codes. However its minimalist white “essentials” pack is dressed in picture-book-retro product drawings which connote an idea of lashings of ginger beer & a simple & more reassuring time. M&S reinterprets the value range rules in another way, principally through the motif of the “torn from a note pad and handwritten” label. Again the overt absence of “design” here says what all other value ranges say, (no wasted money), but behind the casual “notepad” motif, it is hard not to paint a picture of the surrounding domestic scene (a well stocked and well appointed middle-class kitchen or shopping basket carried from store to store collecting provisions). So below the surface these ranges play with cultural narratives of need vs want, conspicuous consumption & cultural capital, puritanical rejection of adornment, the aesthetics of the Protestant work ethic and ideas of thrift & nostalgia...there is so much more going on here than value ! Tesco & Morrisons have shifted subtly away from the classic codes of value of Sainsbury and Asda. Time will tell which is the best approach, but Tesco’s move has implications for brands not just their retail competitors. The introduction of more visually (and thus socially) acceptable value ranges can only mean more private label competition for them. In belt-tightened-Britain brands should at least be aware that even retailer value ranges are now offering some aspects of the “consumption experience” that brands offer to their consumers, but at half the price. And that should be cause for concern.

It’s NPD but not as we know it…

Research has revealed that launches of own-label products overtook those of branded goods for the first time last year. The economic imperative, renewed promotion behind own brand value and prestige ranges coupled with a consumer shift away from the perception that own brand products are inferior to their branded counterparts are among the reasons why. But what are the implications of this for brands and how can they compete against own brand products? What makes us favour a branded product versus an own brand product and are we moving to a stage of own-brand only categories or even supermarkets? The first point to make, of course, is that own label npd is not always new product development in the sense that brand owners might mean - own label innovation is often (and unashamedly) as much about copying than creating new products. Although this is not completely true as in some categories, e.g. fresh food, own label drives some innovation; but generally speaking much supermarket own label is a copy of a branded product. In fact we’re even moving into an area of 'phantom brands', own label products that don’t carry the retailer’s name. Retailers might counter that they invest a lot in creating their (cheaper) copies of branded products and the consumer benefits from this. And they would also say that their innovation is not just skin deep. When ASDA relaunched its standard own label range as "Chosen by You" they made a play on the fact that each product had been tested and rated highly by its consumer panel, thus implying an active product development process. And Tesco recently claimed that the launch of its new Everyday Essentials range was much more than a rebranding exercise – their fish fingers are fishier! So brands need to make sure they remain relevant to their buyers and offer something that justifies the price premium. Many brands remain successful in convincing consumers they are better than own-label, so it can still be done. For whatever reason, the ketchup, salad cream and baked bean markets continue to be dominated by Heinz, whilst for many consumers Coca-Cola is and will remain the real thing. In addition, some brands are perceived as offering better value despite a higher price point. Many consumers are willing to pay a premium for Fairy Liquid in the expectation that they will get more washes from each bottle. But other factors are also at play. Cash strapped mums might buy branded products for other members of the family, including their pets, but will buy own-brand products for themselves; whilst some consumers are influenced by ethical sourcing or charity links to particular brands. There’s plenty of evidence to suggest that on laundry products consumers retain their belief in performance and claims about the ability of a product to clean whiter than its own brand competitors. So yes, we are happy to buy more and more own brands but we still somehow see them as second best. If, as had been suggested, consumers now have greater faith in own label products as a result of a significant improvement in quality, that’s surely not a bad thing? But it does throw down the gauntlet to brands to find new points of differentiation and new ways of making themselves an indispensible part of our shop, now that our loyalty to branded products seems to be growing looser all the time.

If the going gets tough, how will the brands get going?

Votes against austerity packages in France and Greece last week renewed speculation that the euro may soon collapse. Moreover, the bookies tend to agree. Ladbrokes suspended accepting any bets last week on Greece leaving the euro and have reported "plenty of support" at 33/1 on the euro being scrapped this year. But what might this mean for brands in Britain and their consumers? At the start of the recession, the strength of the euro against the pound made the UK a very attractive destination for European shoppers. A reversal this year with a strong pound and a weak euro would mean that British exporters would be less competitive in Europe, which in turn wouldn’t bode well for the growth outlook of the UK economy. This could mean a deepening recession and with UK banks having a high level of exposure to Europe, the consequences of another banking crisis could be dire indeed. If that nightmare scenario were to come to fruition, how might brands adjust their activities to deal with it? The true answer, of course, is this is uncharted territory so nobody truly knows. However, many should already be considering how they might react. Everything would depend, of course, on the depth and severity of any new downturn. However, we can expect there to be an accentuation of the squeezed middle. Household incomes will come under even more severe pressure, only this time, there will be no slack in salaries to provide any fat on the family bones. Housing repossessions have steadied out and are now significantly lower than in 2007 and politically pressure will be applied to keep as many people in their homes as is possible. But, 13 million people already live below the poverty line in the UK and, according to charity The Trussell Trust, food banks fed 128,687 people in the UK last year, 100% more than the previous year. If the cost of food and fuel stays high whilst incomes remain static or fall and unemployment increases, they could be in even more demand. This is both a challenge and an opportunity for brands. Politically, if we reach a stage where significantly more people are struggling to feed themselves, there could be downward pressure applied to brands and retailers, which have made major profits in the good times, to revise down their ambitions in order to help the population through. This would be in direct conflict with their commitment to shareholders to make profit and might be unpalatable for some. There will likely be an increase in demand for ‘value’ products in categories for every day usage; household cleaning products etc, and more so than at present across all other categories. Only the most established brands in the most established ranges are likely to be largely unaffected. Pressure could be applied on retailers and the brands for genuine money saving offers; promotional offers which provide genuine savings rather than ones that require you to spend more. The population’s drift away from loyalty cards is likely to continue as they seek cash savings rather than rewards. Aside from at the highest end, a deep downturn could spell the end of our flirtation with higher priced organic produce, at least for a while, though there is likely to be continue demand for reasonably priced fresh produce. Ironically, elsewhere, there could be positive news for charities, which have suffered from dwindling donations. Economy clothes retailers like Primark and Matalan may find that they are facing stiff competition from charity shops as a new generation of ethical shoppers seek higher quality products, albeit second hand, from which others similarly benefit. This is a dark and unwelcome prospect, but with the economic situation in such a state of flux, it should be one which brands and retailers consider now rather than waiting to arrive. We talk often about the need for brands to become more personal with their consumers. Those that appreciate the importance of this may find a way of incorporating their brand into targeted CSR activity, for example sponsoring or supplying foodbanks nationwide or clothes banks (in the way M&S are doing for Oxfam at present), which would not only create positive brand exposure for themselves and their products but could redefine their brand for a generation.

Tesco ditches the value stripes it earned

There's a new war brewing among the retail multiples. The battleground is 'value shopping' and the cause seems to be who can make their value range look as little like a value range as possible. Few product ranges have become as distinctive and instantly recognisable as the Tesco value range, products marked out from a distance by the bold blue and white stripes of their packaging. Sainsbury's tried it with a white and orange range of their own but somehow it wasn't as distinctive and, perhaps best for them, is didn't become as synonymous as the Tesco range with our collective struggle to get through the recession. However, when Waitrose introduced its sleekly packed Essentials range, I sensed it would be a game changer. There was nothing in the Essentials' packaging that marked it out so obviously as a value product. Perhaps the consumer has begun to feel self-conscious, even stigmatised, by pushing a trolley packed full of blue and white striped packages. Maybe there is a sense in which they feel it marks them out to their fellow shoppers as struggling a bit more, not being able to afford the branded goods. Even in recession it can still be a "Keep up with the Joneses" world. Hence Tesco's decision to ditch the stripes with the launch of its new Everyday Value range, with new colourful and more subtle packaging, is an interesting move. Although Tesco points out it’s not a straight like-for-like swap, the addition of the word "everyday" implies routine as opposed to "cheap as chips" whilst the new packaging creates less negative stand-out in the trolley. Value has been good for Tesco and has been good for the industry. It provided the platform for Tesco's dominance of the supermarket sector which, together with its Finest range, enabled it to pitch against Lidl, Aldi and ASDA at one end whilst Finest pitched it against Sainsbury's, Waitrose and Marks & Spencer at the other. It has enabled the multiples to compete across branded products across the complete category mix. But one consequence of the recession seems to be consumers being polarised across a number of sectors. There appears to be life at the economy end of the market and life at the higher end, but like so much of the country, the middle is being squeezed. It’s always been difficult for retailers to operate convincingly in both sectors. This latest move by Tesco may be the first step towards positioning it at the middle-higher end of the market in time for the recovery if – and when – it finally materialises.

Never Knowingly Downloaded

The announcement by John Lewis that it has extended its range of services to customers, by launching its first own-branded broadband service, marks yet another stage in the delivery of multi-service retailing by the multiples. In one sense it is nothing new. The retail multiples have been diversifying into financial services, mobile phones and broadband for years and, indeed, this latest move broadens John Lewis Partnership’s existing range of services following the launch of John Lewis Insurance in 2010. It also takes over from the existing Waitrose and Greenbee broadband services whilst broadband has become a commodity purchase in its own right over the last two years, more in keeping with the supermarket shelf than anywhere else. But aside from selling us consumer electronics, most of which would have a wi-fi functionality, what track record or expertise does John Lewis Partnership have in the sector that would make us lean towards them as opposed to another, apparently more specialist provider? And does that matter anyway? The answer is all in the brand. The reputations of some of the pure broadband providers seem to have become tarnished by perceptions of being fly-by-night, offering higher downloads speeds than in reality they deliver, farming consumers out to distant call centres or providing questionable levels of customer service. Although the actual broadband may be being provided wholesale to the multiples via one of the mainstream providers anyway, there seems to be greater reassurance from buying our broadband from a reliable and trusted source. And they don’t come more trusted than John Lewis. In the UK Customer Satisfaction Awards 2011 John Lewis was named as Britain’s Most Trusted Organisation whilst also being voted Britain's favourite retailer for the 4th consecutive year. But herein could also lie a potential pitfall. Whilst the John Lewis brand is already fluid and inherently encapsulates service in its retail promise plus the financial services they offer, how will their service guarantee work when they are reliant on a third party delivering the broadband infrastructure? If they are not completely in control over what they are delivering to people and something were to go awry, would this match consumers’ existing expectations of a John Lewis service? And if it did, would this undermine perceptions of the John Lewis brand across its portfolio? They start from a strong position, though. Already they have consumer trust and the belief among their target base that they are not going to be ripped off by a John Lewis proposition. All they need to do is carry across their “Never Knowingly Undersold” price promise, make sure the speed is good, the customer service up to scratch and they could be onto a winner. One suspects if they didn’t think they could deliver that, they wouldn’t have taken the plunge in the first place.

Waste not, want not...convert waste food to an economic success story

In austerity Britain, where value ranges and price drops have become the norm on our supermarket shelves, everyone seems to be doing all that they can to make ends meet within constrained household budgets.

It was all the more surprising, therefore, to read on the BBC’s website recently that British households throw away 4.4 million tonnes of edible food a year.

According to figures published by the Department for Environment, Food and Rural Affairs almost a third of all bread purchased by UK households is dumped when it could be eaten; add to this around a quarter of all vegetables and potatoes, a fifth of all fruit and even 6.3% of all alcoholic drinks.

The Flour Advisory Bureau states that bread remains one of the UK’s favourite foods, with 99% of households buying bread and the equivalent of nearly 12 million loaves are sold each day. That’s 4.38 billion loaves of bread a year at a conservative average price of, say, 90p per loaf, that equates to £3.9 billion a year on bread. Using DEFRA’s figures, this means we are wasting approximately £1.3 billion a year in thrown-away bread. And that’s before you factor in any other products

It all sounds shocking, doesn’t it?

Even more so when you consider statistics released by food redistribution charity FareShare which reveal a sharp rise in demand on charities for food as people all over Britain struggle to put dinner on the table. 42% of charities surveyed reported an increase in demand for food in the past year as food prices soar and the recession bites, putting additional strain on families and people on low incomes.

So behind that stats lies the scope for a campaign for any socially responsible brand willing to take it on that could reduce our waste food mountain whilst at the same time help inject much needed impetus into the economy.

In a similar vein to Persil’s Dirt is Good campaign, who would launch a Waste for Britain campaign?

Sainsbury have recently encouraged people to freeze food rather than throw away; Pret does it Charity Run where it donates unsold produce to homeless shelters at the end of each day; Waitrose supports the “Love food, hate waste” campaign... But the figures suggest that there is plenty of room for other brands to get involved. Their campaigns could focus making consumers aware of the food they are wasting and how much this is costing them – creating new habits to reduce this whilst encouraging them to spend their money elsewhere on enjoyable things. Or providing some means by which people who have a surplus could donate or redirect it to those in greatest need, e.g. through charities like FoodShare.

And it could be bigger than food – we are a nation drowning in “stuff”, but also with a strong urge to give. TK Maxx’s current “Give up Clothes for Good” campaign with Cancer Research UK brings these two themes together – don’t hoard your stuff, don’t chuck it, donate it.

So come on brands of Britain, who will take this on?

Consumers follow the crowd...even to the petrol pump

In the last few days, we have been witness to an extraordinary phenomenon: the herd mentality of the British consumer.

We are at least seven days away from any potential industrial action by tanker drivers which could upset the availability of petrol and yet, following government advice to top up our tanks or hoard small supplies, we set off in our droves to forecourts this week demonstrating almost Blitz-like resolve. As a consequence, the independent retailers' group RMI Petrol reported that demand for petrol rose 172% on a single day, while diesel was up 77%. Halford’s similarly reported a staggering 500% rise in sales of jerry cans.

Some have suggested that the panic-buying is a direct result of the government ‘nudging’ people towards specific outcomes. Perhaps, it has been said, the government needed this to happen for political reasons, as a distraction from the economy, the cash for dinner scandal, to back Labour into a corner over union funding or even to generate a short term petrol duty bonanza to offset the prospect of a double dip recession.

But that would be to suggest that the response has been unusual for British consumers. And that’s plainly not true. British consumers have been in thrall to the ‘Delia Effect’ for the last few years. In 2009 her Christmas television series sparked a rush for cinnamon sticks, Marsala wine and other more obscure ingredients for her chestnut cupcakes. Sainsbury's reported sales of cinnamon sticks up 200 per cent on the same time the previous year, while Marsala wine - an ingredient in Delia's panettone trifle - was up 300 per cent. Sales of pickled walnuts, which Delia teamed with braised venison, doubled.

Delia had a similar impact in 2011 when Waitrose boxed up all of the ingredients you needed to make her traditional Christmas cake. The supermarket even suggested that they expected to see neighbours and friends competing over the most creatively decorated cake.

And it’s not only food. Earlier this year Amazon reported sales of telescopes were up 491% in the three hours after the transmission of BBC2's Stargazing Live, presented by Professor Brian Cox.

Whether it is rushing to fill up your car when there is no shortage of petrol, or racing to get the last cinnamon stick for a cup cake recipe, some would say this is irrational consumer behaviour. But then the advent of behavioural economics has shown that, whilst many marketing strategies are based on the notion that consumers make rational purchasing decisions, study after study have shown that this is not the case.

Simply defining your target audience through conventional and established techniques is no longer enough. Now, marketers must understand a potential customer's likely behaviour. Behavioural economics shoots holes in this by demonstrating how our behaviour is, to a large extent, unconscious, irrational and socially driven. However, whilst we may be dealing with the irrational it can also be predictable.

And one of the key findings of behavioural economics is that we are heavily influenced by other people. We tend to observe and copy what others do and, generally, like conforming. When sponsoring someone the amount you give will be heavily influenced by what other people have already put down. So, if everyone else is making Delia’s cake or looking for Brian’s planets, we don’t want to be out of the loop. And with that, I’m off to fill up the car.

Time for brands to get sweet on diabetics

There’s something of a diabetic epidemic taking place in the UK at the moment. The number of people diagnosed with the disease has risen by nearly 130,000 in the past year to 2.9 million, according to Diabetes UK, and there are now 50% more Britons with diabetes than when GP data on the disease was first published in 2005. The rise is mainly due to a surge in type-2 diabetes, which accounts for 90% of all cases.

Symptoms of diabetes include frequent urination, especially at night, increased thirst, extreme tiredness, unexplained weight loss, slow healing of cuts and wounds, and blurred vision. Left uncontrolled it can take between 10 and 15 years off of a person’s life expectancy.

Often the first reaction on being told you have the disease is that cutting out chocolates and biscuits and then the occasional walk or jog round the block should have the condition licked. But it’s more complicated than that, and this is where brands are missing out both on a potential new revenue stream and a valuable piece of cause related marketing.

Managing diabetes isn’t only about the refined sugar – the chocolates, biscuits and cakes. It’s about managing all sugar. That means taking care when you’re eating fruit, only eating certain fruits, avoiding most processed or ready meals and giving a wide berth to most if not all carbohydrates. White bread, pasta, potatoes, rice all turn to sugar almost as soon as they’ve been consumed. At the moment, a diabetic diet pretty much requires you to start every meal from scratch. And herein lies the opportunity.

When you next stroll around your nearest supermarket, you’ll find next to nothing available to cater for the diabetic market. There may be the odd product – though you’ll have to have the powers of a super detective to find them – but nothing that screams out “we know diabetes is a growing problem and we’re here to cash in on it.” There are plenty of products that proclaim themselves as “low fat”, though these are often high in sugar, and products which are perceived as healthy may be too high in sugar because of the inclusion of dried fruits and the like.

Contrast this, for example, with gluten. Most of the major supermarkets now have a dedicated area for products free from gluten, yet coeliac’s disease, which requires a gluten-free diet, accounts for only 150,000 people in the UK, just 5% of the people who suffer from diabetes.

And don’t restrict your thinking to just the diabetics. The change in diet required can impact on the whole family, which means although as a brand your “universe” of diabetics may be 3 million, in reality by factoring in family eating habits, it could be as much as 12 million, not far short of one fifth of the population, let alone the health conscious non-diabetics, who may just gravitate towards sugar-free products anyway.

Brands that operate across the food spectrum from yoghurt to breakfast cereals, from confectionary to cakes and biscuits all have an opportunity to open up new revenue streams by developing a range of genuinely sugar-free products. This would extend the reach of established brands, open the brands back up to people who otherwise would not be able to buy them and by linking the products with a synergistic charity like Diabetes UK the brand could tap into the established principle that consumers are more pre-disposed to ethical, socially responsible brands.

All this AND Britain’s three million diabetics could have a biscuit with their coffee again. Who could ask for anything more?

Does my bum look big on Facebook?

It’s not a ground-breaking statement to say that the Internet is continuing its advance into most areas of our lives, but the extent to which brands are using online to engage with consumers – almost at the expense of bricks and mortar – appears to be gathering pace.

In the last few weeks chocolatier Thorntons has announced it is to use its website as a “testing ground” for the introduction of new products across the business this Autumn, whilst Shop Direct is unveiling a virtual changing room so that customers can “try on clothes” online. And they are not the first. Tesco has a new virtual fitting-room, which it has launched for women only on Facebook for a two-month trial, sounds like a great idea. You upload a couple of photographs to create a 3D version of yourself and try on items from the supermarket’s F&F clothing range.

But is this move really going to satisfy the consumer’s emotional needs to engage with a brand or a product? Surely, when you start to take away the experience, which for many consumers has always been a part of the whole purchase activity, even an idea which in research looks good will fall over. Last year Polo Ralph Lauren had a touch screen in the window of its high street shops, which you could use to pick the item, size etc and order it through the window whilst window shopping. Despite positive research findings the actual usage was minimal; it was a good idea, but come the crunch, behaviourally, people like the touch and feel as well as the look of trying on clothes and of course in premium brand stores you get well informed and attentive staff. For others it is a social event in itself as well.

There are people, though, for whom clothes shopping is one of their least favourite activities. For them, the online experience is something of a godsend. With Marks & Spencer running videos of walking and moving in each item of clothing on the site, can get a feel for the way the clothing looks on a real person and which can aid decision making without the hassle of the high street or the shopping mall. Moreover, reviews online from other shoppers – good and bad – provide a guide to purchasing that you just wouldn’t get if you wandered around in-store. For these shoppers, where it is being done well, the online experience helps consumers make good rather than poor purchasing decisions.

The web is clearly more cost and time effective than doing everything manually. But at the moment, convenience is ruling the day. Flip the coin, if you will, to the brand or the retailer’s perspective, and you can see how online could give you access to a growing, almost global customer base that you simply would not be able to access from a small store or stores. Who knows, perhaps in ten years’ time, we will be talking about a new concept called ‘offline stores’ where you can actually go and touch and try on the clothes in dedicated retail outlets, rather than having to get them online. There is a fine line behaviourally to online transition; how far can it go before ‘enough is enough’ and customers push back?

The answer at the moment is that brands and retailers probably have to do both really well to cater for all consumer mindsets, considering those shopping online are either less concerned, or have already been in-store and made up their minds. But, whilst there is clearly a place for a very integrated online shopping experience, for some categories the experience counts for just as much. Buying some weekly food shopping or a DVD, going online is almost a given. Buying yourself a new suit, would you really want to put your trust in an online cartoon avatar, or does Mr Smith who has been in the business for 40 years count for so much more?

Brands that get it right by “doing it for charity”

If ever there was such a thing as a win-win situation surely it is the advent of cause-related marketing; the notion of buying a product or service whilst making a donation to a charity at the same time. It is something that has not only become a staple of the set piece charity events of the year – Sport Relief, Comic Relief and Children In Need – but is increasingly finding its way into the mainstream marketing activity of many brands.
And it should come as no surprise why. The Pink Ribbon Foundation quotes a study of 2,000 people, which revealed that 81% would be more likely to buy a product that was linked with a cause and 85% said that they would also have a more positive image of a company that was linked with a cause. Two thirds said they thought more companies should be linked with a cause, whilst eight out of ten consumers said that if price and quality were equal, supporting a cause made a difference to them.
The upshot of this is that consumers seem to be looking for more from the brands with which they engage. The latest to do this is Fairshare Music (www.fairsharemusic.com) which enables you to download the music of your choice and half of the profits from the download will be given to your choice of one of 18 charity partners, which stretch broadly across a wide range of organizations and causes. They are not alone. DKNY, which gets the vanilla for its fragrances from Uganda, supports the work of CARE with vanilla bean farmers in the country (www.dknyfragrances.co.uk/pure/charity.php) whilst running equipment retailer Sweatshop is throwing its weight behind the Microloan Foundation, to provide training and loans to women in Africa to help lift them out of poverty.
In an article in the FT some time ago Tim Harford explained that there were broadly two types of giver: those who donate out of pure altruism and those who give to get the “warm glow” from having donated to charity. Harford explained that these weren’t necessarily two sides of the same coin. Warm-glow givers, he wrote, don’t think too much about whether the money they give is going to be effective whereas the altruist needs to know their donation is going to be effective. “While the altruist would want the evidence, the warm-glow giver just wants to feel the connection”, he said. The third motivation, Harford identified, was social pressure: the act of giving because we think that’s what others expect of us.
In terms of the way brands and consumers act from a cause-related marketing standpoint in an economic downturn, this distinction can be critical. There is an increase in people donating their time rather than their money as a way of making a contribution, though altruists and warm glow givers alike may be more tempted by the brand charity link. Altruists might give more in a recession because they can see the poor getting poorer and will see that more could be achieved with their donation. Those who seek the rosy glow, however, but are themselves under pressure may well metaphorically rather hide behind the sofa than be pressured into donating beyond their means. And that’s why the link between brands and causes can be so effective, because the choice is entirely in the hands of the consumer without pressure from external sources
In balancing the need to create value for consumers whilst at the same time offering an outlet for our ethical and charitable needs at a time when money is tight, some brands may just have created a win-win giving model for the recession.

www.engage-research.com

The "his & hers" ad campaign is upon us

Fast food chain KFC has announced its intention to roll out its first 'his and hers' TV advertising campaign to support the release of its 'healthy' non-fried BBQ Rancher burger. But is it really important for brands to target men and women separately to achieve coverage or can marketing to both sexes be less gender specific?

KFC is not an obvious candidate for gender bending, so will assume that this is a straightforward male vs female perspective on the same proposition. Makes sense given the wealth of evidence suggesting that men and women are, in fact, different and might have a different perspective on food. Contrast this with the approach of Lynx who, launching their female range, have chosen to stress the shared territory of youthful sexual attraction for their “Unleash the Chaos” TV ad.

This all introduces a really interesting and conceptually simple way of targeting. For example, many grocery brands are now bought by men rather than just “housewives”, but I wonder whether advertising has really kept up with this in anything other than token ways. Yes advertising might focus on a gender-less product truth or human insight that the brand addresses, but developing comms which address only a predominantly female or male or mono-gender audience must be a compromise.

However, given that KFC is embarking on two separate advertising campaigns, what happens if I as a bloke watching "women's TV" I see the women's version first and vice versa? Might this give me the impression that I believe the product is aimed at women, which influences my behaviour towards the product moving forward. 

This in turn could affect potential reach. One of my colleagues did some exploratory work on this for a beer brand in the US where they would shift advertising around states. Normally they would assume reach is a combination of spend versus ability to find a target population. Given the chances of a woman and a man seeing a single advertisement are about the same, a brand would have to spend twice as much (or something similar) to achieve the same level of reach as a traditional, more generic ad, although the impact you would expect would be greater as the ad is targeted. The big question is whether the impact advantage outweighs the extra cost of advertising to reach your total target.

Which brands would be ripe for this double-gender approach? First of all let’s re-imagine classically but perhaps mistakenly gendered categories and see what we can do with those – “male” categories like cars, technology, finance and “female” categories like food, laundry and household cleaning. Would a more overt and genuine addressing of the female perspective on cars break the stranglehold of the “metal porn” and twisty mountain road formula? And would an authentically male perspective on household cleaning do better than resort to tired stereotypes of modern “life juggling” but still caring housewifery? Or is this an old fashioned stereotype of what advertising is like?

So things have changed somewhat since the 70s, but actually a lot of the modern gender-neutral advertising seems to ignore the gender angle on brands and products. Lots of products that are used in different ways by men and women (mobile phones for example) often feature non-gendered people of generally trendy man-woman appearance/persuasion communicating and connecting...but in identical ways.

Perhaps we should call for a refreshingly adult approach to gender, as KFC seems to be adopting. Whether because of nature or nurture, men and women ARE different, whilst they increasingly use and buy the same products and brands, they use those products differently, they respond to those brands differently, they respond to emotional and rational messages differently, they like and engage with different styles of media, advertising, content. And so maybe the age of the “his and hers” ad is upon us.

The "his & hers" ad campaign is upon us

Fast food chain KFC has announced its intention to roll out its first 'his and hers' TV advertising campaign to support the release of its 'healthy' non-fried BBQ Rancher burger. But is it really important for brands to target men and women separately to achieve coverage or can marketing to both sexes be less gender specific?

KFC is not an obvious candidate for gender bending, so will assume that this is a straightforward male vs female perspective on the same proposition. Makes sense given the wealth of evidence suggesting that men and women are, in fact, different and might have a different perspective on food. Contrast this with the approach of Lynx who, launching their female range, have chosen to stress the shared territory of youthful sexual attraction for their “Unleash the Chaos” TV ad.

This all introduces a really interesting and conceptually simple way of targeting. For example, many grocery brands are now bought by men rather than just “housewives”, but I wonder whether advertising has really kept up with this in anything other than token ways. Yes advertising might focus on a gender-less product truth or human insight that the brand addresses, but developing comms which address only a predominantly female or male or mono-gender audience must be a compromise.

However, given that KFC is embarking on two separate advertising campaigns, what happens if I as a bloke watching "women's TV" I see the women's version first and vice versa? Might this give me the impression that I believe the product is aimed at women, which influences my behaviour towards the product moving forward.

This in turn could affect potential reach. One of my colleagues did some exploratory work on this for a beer brand in the US where they would shift advertising around states. Normally they would assume reach is a combination of spend versus ability to find a target population. Given the chances of a woman and a man seeing a single advertisement are about the same, a brand would have to spend twice as much (or something similar) to achieve the same level of reach as a traditional, more generic ad, although the impact you would expect would be greater as the ad is targeted. The big question is whether the impact advantage outweighs the extra cost of advertising to reach your total target.

Which brands would be ripe for this double-gender approach? First of all let’s re-imagine classically but perhaps mistakenly gendered categories and see what we can do with those – “male” categories like cars, technology, finance and “female” categories like food, laundry and household cleaning. Would a more overt and genuine addressing of the female perspective on cars break the stranglehold of the “metal porn” and twisty mountain road formula? And would an authentically male perspective on household cleaning do better than resort to tired stereotypes of modern “life juggling” but still caring housewifery? Or is this an old fashioned stereotype of what advertising is like?

So things have changed somewhat since the 70s, but actually a lot of the modern gender-neutral advertising seems to ignore the gender angle on brands and products. Lots of products that are used in different ways by men and women (mobile phones for example) often feature non-gendered people of generally trendy man-woman appearance/persuasion communicating and connecting...but in identical ways.

Perhaps we should call for a refreshingly adult approach to gender, as KFC seems to be adopting. Whether because of nature or nurture, men and women ARE different, whilst they increasingly use and buy the same products and brands, they use those products differently, they respond to those brands differently, they respond to emotional and rational messages differently, they like and engage with different styles of media, advertising, content. And so maybe the age of the “his and hers” ad is upon us.

Is there really such a thing as customer loyalty?

Dunkin’ Donuts, that staple of the American mall, has just been named by Brands Keys Customer Loyalty Engagement Index as number one in customer loyalty for the highly competitive US coffee sector for the sixth year in a row. It doesn’t take a marketing guru to see that they’re obviously doing something right, but is customer loyalty a genuine phenomenon and, if so, what can brands do to influence it?
On one level, of course, loyalty schemes have as much to do with loyalty as reality television is about reality. Loyalty cards are simply promotional devices that work in both directions; as a customer I get money off my next bill and the retailer in turn collects a lot of data about me they wouldn’t otherwise have got. But is this really inspiring my loyalty?
There will always be individuals or groups of consumers who align themselves with brands with which they think they have something in common or which they feel say something about them and their status. This is particularly the case with high end fashion or jewellery brands or consumer electronics, of which Apple is the prime example.
But this aside, when it comes to brands are we really talking about loyalty or are we talking about convenience and opportunism on the part of the consumer. Loyalty as a concept speaks of our unwavering need to stick by something even in the face fierce opposition – the way football supporters, for instance, stand by their team through thick and thin.
Convenience, though, is something different. I may have a Tesco loyalty card because I shop there three times a week. I may not be doing that out of loyalty, but out of convenience. If I move house and Sainsbury’s becomes my nearest supermarket, the likelihood is that because of convenience my “loyalty” would transfer to them. It is too easy to confuse loyalty with frequency. Loyalty is much more about emotion and an instinctive reaction to a brand and this has to be considered differently.
Good customer service is certainly an important factor in brand loyalty but there has to be a good product too. Brands also have to stand for something; if you know what the brand is about and why it is right for you, you will almost always pick that brand over a competitor at price parity and most likely even at a premium price position. Sometimes, though, what we believe is loyalty may just be inertia. We may be inherently dissatisfied with our bank, utility company or broadband provider, but we simply can't be bothered to switch because it seems like such a hassle.
The flip side to this loyalty question is the lack of rewards for being loyal versus the bonuses you might get for switching brands. This is more likely to occur in the services sector but there don't seem to be many advantages in staying with say a bank or a savings provider. Often introductory offers are better than the ones available to current customers. The 'savvy' consumers are thought to be those who are the most promiscuous in terms of brand behaviour.

Whether it is loyalty or not, what is clear is that people warm to brands that show a degree of humanisation. Consumers like it when they can see a brand that displays the characteristics of its community, no matter how large a corporate it is, and avoids adopting a rather soulless "one size fits all" approach. McDonalds and Dunkin’ Donuts are particularly good at this. Although the consistency of the brand experience is paramount it is the little things that make the difference that makes customers want come back and repeat purchase.

The Brand Battle of the Sexes

So Lynx launches a female product – does this mean that feminism has finally run its course. Well maybe not, but it has certainly generated a lot of interest in the marketing community. One could argue that in our “lady to ladette” culture, it is surprising that it has taken so long for a brand which is all about youthful sexual attraction to extend its reach to women. But the more interesting questions are: whether this necessarily represents a game changer for the sector? Does it swing both ways – can female brands crossover to men, especially as the male grooming category has grown by adopting traditionally feminine products and behaviours? And are there any implications for other gendered categories and brands?

The rise of the unisex fragrance sector in recent years has shown, particularly in the bathroom, that the boundaries between the genders are beginning to blur. The impact of programmes like The Only Way Is Essex on crossing over grooming and tanning products from the women's to the men's markets had underpinned the success of the sector. However, this has largely been on the back of discernibly male brands developing new products, rather than established female-friendly brands breaking into the men's market.

Developing cross gender brands, though, is nothing new. It is something that Levi's has successfully done in the jeans market and Gillette has achieved with razors, though both are examples, like Lynx, of a male brand being adapted to target a female audience. There are fewer examples of it working as successfully the other way around. Unilever’s other global personal care brand phenomenon, Dove, has arguably made the move from female to male, especially given its assertively female positioning, with the male equivalent Men+Care successfully launched a couple of years ago. However before the Campaign for Real Beauty came along, Dove was a more gender neutral soap and its challenging of gender stereotyping has also made it something of a post-gendered brand.

It is interesting that this is a lack of female to male brand extension, whilst products freely travel, suggesting that there is something insecure in men’s psyche which makes “appearing female” far less acceptable than women adopting some male traits. This despite years of the apparent “feminising” of traditional masculinity (male grooming, male parenting, male emoting...). So it seems that it would take a brave brand to make that particular play. So where do we see more gender ambiguity in branding?

Chanel, widely perceived as a predominantly female brand, has had success winning men over to its range of watches, but less so to its core fragrance products. Success seems to come most readily at the luxury end of the market, where there is less of an obvious demarcation between male and female product use than elsewhere. Brands like Hugo Boss, Louis Vuitton, Chanel and Cartier seem to say more about the user's status and success than they do about their gender and this seems to override any gender sensitivities.

Some companies have succeeded in developing genuinely unisex brands, most obviously in the fragrance market, whilst others, like the watchmaker Swatch, have developed as distinctly gender-neutral brands. Perhaps the future lies in this continued development of androgynous brands, like Calvin Klein, which will challenge established brand demarcations head on, both in product design and brand positioning, and may well win.

So what might this tell us about other gendered categories : cars, media, clothing, technology...Lynx’s move must question the assumption that brands targeted largely at men OR women are basing their gender bias on functional needs, historical precedence, even the idea of psychological pre-disposition (which seems to have become fashionable again as the nature nurture debate lurches back towards “nature” in matters of gender). So will we see hitherto staunchly “male” brands such as Yorkie following Lynx and targeting a female audience and, hopefully, classically “female” brands like Comfort successfully targeting men. Then surely the post gendered brand world will have arrived.

Celebrity Brand Match

Using celebrities to advertise products is nothing new. Even before Hollywood legends Rita Hayworth and John Wayne took up the challenge of promoting Tru-Color Lipstick and Camel cigarettes respectively in the 1940s and 1950s, brands had recognised the allure of being associated with the idols of the day.

So this week’s news that chocolate bar Snickers is replacing A-Team hero Mr T with former Dynasty sirens Joan Collins and Stephanie Beacham shouldn’t be that much of a news story. Except it raised eyebrows in our office and nobody I have spoken to since can see an overt Joan Collins – Snickers connection. But we also remembered that some initially arresting associations turn out rather well (John Lydon with Country Life); and some which look solid gold (Tiger Woods and Gillette) can become somewhat tarnished.

Is the use of Joan Collins an example not of direct “endorsement” or association, but of the way that some brands are abandoning the traditional view of needing a celebrity that has an obvious brand fit in favour of one that offers talkability? Or is the brand merely continuing to tap in to the prevailing mood of 80s nostalgia providing a warm feeling from the past as we contemplate a somewhat chilly immediate future ! Time will tell when we see the campaign.

Whilst ad agencies might be nervous of the role of research in such “irrational” celebrity associations, we think that good research should be key. It can be fundamental to understanding how to maximise the value of this style of campaign and can explore irrational appeal of an apparently unconnected character, as in this case, as well as the more straightforward fit of an obvious celebrity link (Parky with over 50s life assurance for example). Ensuring that you bring on board the right ‘face’ (one which can resonate with your target audiences whether rationally or irrationally) as well as getting the tone and humour content of the campaign is essential and research will help here.

We can only presume that research has been undertaken that shows Joan Collins works – in the context of this campaign - for Snickers’ target audiences. Although an older celebrity like Joan Collins significantly reduces the risk of tying your campaign up with a one hit wonder, none of that is beneficial if it doesn’t achieve the desired cut-through and again good research which “gets” the creative idea can help here.

The choice to link Snickers with Mr T was clearly well researched. Not only was he retro and identifiable to those of us of a certain age, he was also cool to a younger generation through a resurgent interest in The A-Team on the back of the Hollywood remake of the television series. It remains to be seen how well Joan Collins will straddle these various demographics.

Can brands feel consumers’ pain?

A report by the housing charity, Shelter, this week has confirmed that almost one million Britons have taken out an emergency ‘payday’ loan to help pay their rent or mortgage in the last year. In addition, the charity also reported that seven million Britons – that’s 10 per cent of the population - are relying on some form of credit to help pay their housing costs.

With so much of the population under such fundamental financial pressure this situation necessarily has implications for brands.

Consumers will likely be more vigilant and more eagle-eyed than ever and are likely to be not only rationally searching for the best bargains but will be willing to put more effort into securing them. They will also be looking for emotional pay offs: higher level benefits such as “doing the right thing”, “being responsible” etc as well as more basic “animal” drivers such as “competing for scarce resources”, “protecting your family” etc. It will be interesting to see how people’s well developed need to be part of herd and community plays out against this background.

Whilst brands might be tempted to introduce “value” variants of their best loved products we would caution against straying too far from accepted brand values and setting the brand up for a later fall. Brands could more fruitfully consider greater innovation in promotional strategy (we have seen iterations of this with retailer schemes such as Asda’s “Price Guarantee” and Sainsbury’s “Brand Match”). They could do this by applying product innovation research techniques to create, develop and test truly innovative new value/promotional ideas rather than relying on the classic well-trodden path. Larger, global brands may even look to see what has worked for them in less well off, emerging markets to see whether messaging or products for ‘poorer’ consumers might be transferable.

In this sense, there is also a communications role here for brands. They, a little like MPs during this period of austerity, could do worse than to try and look like they are feeling the pain too. It’s tricky to pull off authentically but can cement the relationship with your customer base if you can do so.

As much as there may be temptation for brands to set themselves up to operate within a recession, they often forget to plan for leaving a recession. Launching value brands might bring some dividend now but longer term could damage their positioning if it they operate in a more premium segment. Own Label will by default boom right now, and may be the trick for brands and retailers alike is to promote ‘the game’ of saving money with rewards who can shop savvy whilst still retaining the brands to which they are emotionally and behaviourally are too strongly connected. Who can be the first supermarket to genuinely reward consumers by spending less or buying more efficiently? It is something energy companies have tried in the past – rewards for being more energy efficient. Let’s try rewards for being more shopping efficient.

Brands will need to work harder to put themselves in a position that they do not become the ‘dropped brand’ so that when the inevitable exit from recession arrives they are, from a value perception, in the right place for their brand. In a current economic climate dominated by us having to ‘make do’ with a raft of bland value brands, there will always be a place for more premium products that we aspire to, those brands have to work harder though to keep those emotional ties both through maintaining their position but without appearing to be out of touch with the financial reality people face.