In New Spot for TV With Extra Color, McGarryBowen Comes Close to Admitting Paradox of Advertising a TV on a TV
Posted by Bob Garfield on 03.22.10
Yellow is an innovation? Really?
All this time, we'd assumed the three prime colors of the TV holy trinity were the three primary colors: blue, red and yellow. Nope, turns out that it was blue, red and green. Who knew?
If adding a blade to the Quattro razor makes for a smoother shave, it stands to reason that adding yellow to the video palette would make TV more colorful, bright and lifelike. Enter, then, Quattron, from Sharp, which outdoes the status quo to the tune of 33%. Whether this results in a noticeable improvement, however, we are in no position to judge. The slogan is, "You have to see it to see it," and the slogan is true.
The new commercial, featuring actor George Takei of "Star Trek" fame, not only makes little attempt to demonstrate the product difference, it comes within a whisker of self-consciously pointing up the absurdity of attempting to demonstrate the product difference.
After all, showing superior color on a TV commercial is a visual tautology; the picture quality is confined to the picture quality of the set being watched. This leaves it only for the ad to imply (i.e., fake) superiority by splashing all sorts of bright, vivid primary and secondary colors on the screen, as luminously as possible. Tropical fish have historically been popular subjects. Sony Bravia used DayGlo bouncing balls and cannon-fired wall paint, all of which looked good on any screen.
Sure enough, Sharp too goes the coral-reef route, on a flat-screen Aquos set up behind Takei.
"At Sharp," he says, clad in the white labcoat of a Sharp engineer, "our goal is to reproduce every color in the world on TV. Introducing Quattron quad-pixel technology. It adds a fourth color, yellow, to the standard RGB color system, creating a vast array of colors you can't see with your TV's three-color technology. But you can see this."
Here something odd happens. The flat-screen pivots sideways and Takei takes a gander.
"Whooa!" he shrieks in amazement. "Oh, myyyyy!"
Hmm. Apparently some sort of joke has taken place. It's clear enough even from the sidelong angle that the fish scene itself doesn't change, but maybe Nemo shoots him the finger or moons him or something we can't make out. Whatever hilarious and unexpected moment we've not been privy to, Takei chuckles right into the voice-over:
"Quattron from Sharp. You have to see it to see it."
It's as if McGarry Bowen wanted to have fun with the idea that a TV commercial for a TV is a fool's errand, but didn't quite have the nerve -- or the client leeway -- to admit that you actually have to see it to see it. But, no, conventions are conventions, and there's the yellow aquarium specimen looking approximately as bright and vivid in blue-red-and-greentron as it does in Quattron.
The net net of all this is that a pretty good idea -- seeing it to believe it -- is largely squandered by all the goofy misdirection. This would include the casting. Takei may or may not retain some futuristic Mr. Sulu resonance, but if so, it is not exploited here. He's just a strange guy with a deep voice, dyed hair and a vaguely creepy sense of humor.
Our best guess is that this campaign will succeed or fail based on a combination of media weight and online word-of-mouth about the merits of Quattron.
Of course, if TVs are like the razor business, we expect Sony to introduce Quintron at any moment -- "For the brownest browns on TV!" -- followed by the LC Octopix. Whoooa! Oh, my my my my my my my my.
http://adage.com/garfield/post?article_id=142899
Sunday, March 28, 2010
Saturday, March 27, 2010
Time-Tested Companies Top Britain’s 100 Biggest Brands
March 26, 2010
Britain’s most popular grocery brands saw another successful year despite significant economic challenges, according to the annual Britain’s 100 Biggest Brands report. Compiled by The Nielsen Company and published in trade magazine, The Grocer, the report ranks the 100 best selling grocery brands in Great Britain.
“The year was a tough one for the consumer and value for money became more important than ever before. What is apparent though is that shoppers have continued to buy trusted brands,” said Jake Shepherd, Marketing Director at Nielsen.
The 2009 sales value of the top 100 brands accounted for £16.7 billion (12.9%) of the total £130 billion grocery market, an increase of 4.5% YoY. The growth was ahead of total market growths which were 3.8% for the year.
Topping the table again this year is Coca Cola, which has become the first-ever grocery brand to pass the £1 billion mark in the U.K. The iconic brand was launched 110 years ago and continues to perform strongly growing 4.9% in 2009 to retain the top spot.
Other classic brands that have stood the test of time and feature in the top 10 of the league include bread brands Warburton’s (#2) and Hovis (#3). Warburton’s is 134 years old and the Bolton-based brand remains strong at number two. Hovis, whose branding hangs heavily on its heritage, enjoyed a very successful year with sales growing more than 13%, sits in fourth place. Cadbury’s Dairy Milk, another brand which has survived for more than a century, ranks fifth and Britvic’s Robinsons drink — which has a history that can be traced back to 1823 — retained its 10th place position.
The oldest surviving brand in the top 100 league is Twinings, which entered the Top 100 for the first time this year, 304 years after Thomas Twining began selling tea from his first premises on the Strand in London. Three centuries later, the brand grew sales 11% and was one of the five new entries to the top 100.
“The report sees some really exceptional performances from brands whose stories began up to three centuries ago but who continued to prevail in 2009. Nielsen has seen consumers become much more cautious and many have undertaken strategies to save money on the weekly shop, but Britain’s 100 Biggest Grocery Brands report highlights that quality, trusted brands can survive and indeed flourish in strong and tough times alike,” concluded Shepherd.
| Britain’s Top 25 Brands | |
|---|---|
| Rank | Brand |
| 1 | Coke |
| 2 | Warburtons |
| 3 | Walkers Crisps |
| 4 | Hovis |
| 5 | Cadbury Dairy Milk |
| 6 | Nescafe |
| 7 | Kingsmill |
| 8 | Andrex |
| 9 | Lucozade |
| 10 | Robinsons |
| 11 | Pepsi |
| 12 | McCains Chips & Potatoes |
| 13 | Tropicana |
| 14 | Whiskas Total |
| 15 | Muller Corner |
| 16 | Heinz Beanz |
| 17 | Lurpak |
| 18 | Danone Activia |
| 19 | Persil |
| 20 | Heinz Soup |
| 21 | Youngs Frozen Fish (Branded) |
| 22 | Pedigree Total |
| 23 | Flora |
| 24 | Felix Total |
| 25 | Cathedral City |
| Source: The Nielsen Company In this report, a brand is defined as any products sold under a brand name within a given category. The report covers grocery brands only and does not include personal care, OTC, alcohol or tobacco products. | |
The complete list of 100 brands is available at The Grocer.
Friday, March 26, 2010
Unilever Puts in Face Time With the Chinese Consumer
Ad Age Tags Along With Greater China Chairman Alan Jope as He Examines the Aspirations, Buying Habits of a Middle-Class Family
Posted by Normandy Madden on 03.22.10
SHANGHAI (AdAge.com) -- Alan Jope's schedule last week illustrates the importance of the Chinese market for multinationals in almost every industry.
But the meeting on his agenda most likely to help Unilever achieve its 20% revenue-growth goal this year was not with an elite power broker. It was an afternoon he spent hanging out with Zu Qingrong, a 41-year-old woman from Dalian, a city in northeast China.
Ms. Zu is one of dozens of Chinese men and women who have allowed Mr. Jope into their homes since he moved to China in April 2009.
An outgoing, curious Scotsman, Mr. Jope pries into their daily lives, asking about hygiene practices, internet-surfing habits, finances and child-care philosophies, along with fears and dreams. And, of course, he asks how and where they consume food and personal-care products. Sometimes the conversation even turns to topics such as political beliefs and extramarital affairs -- nothing is off-limits. After these visits, Mr. Jope will tell managers to switch dollars to online advertising, tweak packaging or the like.
On the ground
To show just how valuable these first-hand encounters are for China's second-biggest advertiser after Procter & Gamble, Mr. Jope invited Advertising Age to tag along on his visit to Ms. Zu's home. We were joined by Unilever Senior Brand Manager Subrina Liu and Kitty Lun, chairman-CEO, China at Lowe Worldwide, which handles creative for brands such as Omo detergent and Lux.
"It's easy to distance ourselves from consumers in this ivory tower," said Mr. Jope, with a sweeping gesture toward Unilever's modern and airy 22,000 square-meter regional headquarters in Shanghai, with an even bigger R&D center across the street.
"I try to do some sort of consumer connect monthly, usually in combination with a market visit to a customer or retail check outside Shanghai," he said. That's a routine he's followed since joining Unilever in 1985. He's been inside hundreds of homes in developed nations including the U.S., U.K., France and Germany, and in emerging markets such as Brazil, Russia, South Africa, Mexico, Colombia and Senegal. He once spent 24 hours with a Muslim family living outside Jakarta, Indonesia.
Today's session is with a bubbly middle-class woman who lives in Shanghai with her husband, an engineer for Philips, and their 8-year-old daughter.
The lively and self-confident daughter of a Chinese navy captain and a doctor, Ms. Zu works as a freelance consultant advising parents about overseas study options for their children. She has never left China but craves the opportunity to travel abroad and insists on conversing with Mr. Jope in English "to practice."
Comfortable life
The Zu household's monthly income of $2,200 is high but not uncommon for a tier-one city like Shanghai, where incomes are steadily rising, making it easier for consumers to afford international brands such as Lux shampoo and Walls ice cream.
The Zus can't afford a car "yet," but their lifestyle is comfortable. They have three computers -- a laptop for each parent and a desktop for their daughter -- as well as satellite TV and wireless internet access. Her husband has a Nokia E71 smartphone while Ms. Zu has two phones, including a Sony Ericsson.
Ms. Zu goes online for e-mail, Skype calls to overseas friends, and news and beauty tips on 163.com, China's biggest site. She chats with other moms on online bulletin boards. She's afraid to shop online, so a work colleague organizes her purchases on Alibaba's Taobao.com site -- mainly food, clothing and cosmetic brands from Dalian.
She uses QQ.com, Tencent's popular instant-messaging platform, to organize weekend dinners and soccer games with old friends from Dalian who also live in Shanghai. Her husband, meanwhile, spends hours online each evening playing games and downloading music.
Heavy use of digital media is common across China, a discovery Mr. Jope made during his very first home visit last spring. He immediately instructed every division head in China to devote at least 10% of their media budgets to online media.
Ms. Zu is a typical Chinese consumer in many ways but offers a few surprises, including a relatively relaxed attitude to parenting. She dismissed the tainted milk scandal in China in late 2008 with a wave of her hand, commenting that she had "too much else to worry about." And her daughter is saddled with just one extracurricular activity, a Saturday morning dance class. She admires Chinese actresses like Zhang Ziyi, but prefers western male celebrities. Her dream date: "manly and handsome" actor Denzel Washington.
Shopping trip
After two hours spent grilling Ms. Zu at home, our group visited the place she shops at weekly, a three-story Carrefour hypermarket in the Gubei area of Shanghai that is one of the world's busiest stores.
Mr. Jope quizzed her on beauty and home-care brands in the store, and that conversation confirmed his suspicions: "I have been concerned about the consumer's ability to navigate the Omo brand architecture. She was a fairly loyal Omo consumer, but was unaware of our Omo range architecture and was unable to figure it out at point-of-sale." The next day, he put "increased urgency against the launch of improved Omo pack graphics that make it easier to navigate the range."
In the shampoo aisle, we ran into an in-store promoter from a promotions company that works for Unilever and heard her pitch for Clear shampoo. Mr. Jope later said he'd give her a "four out of 10" grade because she didn't fully explain Clear's anti-dandruff benefits, and she pushed the promotion -- buy the bottle and get a free mini-bottle -- rather than the brand, even though Clear isn't a value shampoo for Unilever. The takeaway: Mr. Jope sees the need for a steady supply of well-trained promoters rather than outsourcing to poorly trained hires.
Overall, Mr. Jope came away satisfied that the Chinese consumer is steadily moving toward quality multinational brands. "She's proud of where she is and what she has achieved. This was a sharp reminder of how independent Chinese women are in urban markets."
http://adage.com/globalnews/article?article_id=142885
Posted by Normandy Madden on 03.22.10
SHANGHAI (AdAge.com) -- Alan Jope's schedule last week illustrates the importance of the Chinese market for multinationals in almost every industry.
But the meeting on his agenda most likely to help Unilever achieve its 20% revenue-growth goal this year was not with an elite power broker. It was an afternoon he spent hanging out with Zu Qingrong, a 41-year-old woman from Dalian, a city in northeast China.
Ms. Zu is one of dozens of Chinese men and women who have allowed Mr. Jope into their homes since he moved to China in April 2009.
An outgoing, curious Scotsman, Mr. Jope pries into their daily lives, asking about hygiene practices, internet-surfing habits, finances and child-care philosophies, along with fears and dreams. And, of course, he asks how and where they consume food and personal-care products. Sometimes the conversation even turns to topics such as political beliefs and extramarital affairs -- nothing is off-limits. After these visits, Mr. Jope will tell managers to switch dollars to online advertising, tweak packaging or the like.
On the ground
To show just how valuable these first-hand encounters are for China's second-biggest advertiser after Procter & Gamble, Mr. Jope invited Advertising Age to tag along on his visit to Ms. Zu's home. We were joined by Unilever Senior Brand Manager Subrina Liu and Kitty Lun, chairman-CEO, China at Lowe Worldwide, which handles creative for brands such as Omo detergent and Lux.
"It's easy to distance ourselves from consumers in this ivory tower," said Mr. Jope, with a sweeping gesture toward Unilever's modern and airy 22,000 square-meter regional headquarters in Shanghai, with an even bigger R&D center across the street.
"I try to do some sort of consumer connect monthly, usually in combination with a market visit to a customer or retail check outside Shanghai," he said. That's a routine he's followed since joining Unilever in 1985. He's been inside hundreds of homes in developed nations including the U.S., U.K., France and Germany, and in emerging markets such as Brazil, Russia, South Africa, Mexico, Colombia and Senegal. He once spent 24 hours with a Muslim family living outside Jakarta, Indonesia.
Today's session is with a bubbly middle-class woman who lives in Shanghai with her husband, an engineer for Philips, and their 8-year-old daughter.
The lively and self-confident daughter of a Chinese navy captain and a doctor, Ms. Zu works as a freelance consultant advising parents about overseas study options for their children. She has never left China but craves the opportunity to travel abroad and insists on conversing with Mr. Jope in English "to practice."
Comfortable life
The Zu household's monthly income of $2,200 is high but not uncommon for a tier-one city like Shanghai, where incomes are steadily rising, making it easier for consumers to afford international brands such as Lux shampoo and Walls ice cream.
The Zus can't afford a car "yet," but their lifestyle is comfortable. They have three computers -- a laptop for each parent and a desktop for their daughter -- as well as satellite TV and wireless internet access. Her husband has a Nokia E71 smartphone while Ms. Zu has two phones, including a Sony Ericsson.
Ms. Zu goes online for e-mail, Skype calls to overseas friends, and news and beauty tips on 163.com, China's biggest site. She chats with other moms on online bulletin boards. She's afraid to shop online, so a work colleague organizes her purchases on Alibaba's Taobao.com site -- mainly food, clothing and cosmetic brands from Dalian.
She uses QQ.com, Tencent's popular instant-messaging platform, to organize weekend dinners and soccer games with old friends from Dalian who also live in Shanghai. Her husband, meanwhile, spends hours online each evening playing games and downloading music.
Heavy use of digital media is common across China, a discovery Mr. Jope made during his very first home visit last spring. He immediately instructed every division head in China to devote at least 10% of their media budgets to online media.
Ms. Zu is a typical Chinese consumer in many ways but offers a few surprises, including a relatively relaxed attitude to parenting. She dismissed the tainted milk scandal in China in late 2008 with a wave of her hand, commenting that she had "too much else to worry about." And her daughter is saddled with just one extracurricular activity, a Saturday morning dance class. She admires Chinese actresses like Zhang Ziyi, but prefers western male celebrities. Her dream date: "manly and handsome" actor Denzel Washington.
Shopping trip
After two hours spent grilling Ms. Zu at home, our group visited the place she shops at weekly, a three-story Carrefour hypermarket in the Gubei area of Shanghai that is one of the world's busiest stores.
Mr. Jope quizzed her on beauty and home-care brands in the store, and that conversation confirmed his suspicions: "I have been concerned about the consumer's ability to navigate the Omo brand architecture. She was a fairly loyal Omo consumer, but was unaware of our Omo range architecture and was unable to figure it out at point-of-sale." The next day, he put "increased urgency against the launch of improved Omo pack graphics that make it easier to navigate the range."
In the shampoo aisle, we ran into an in-store promoter from a promotions company that works for Unilever and heard her pitch for Clear shampoo. Mr. Jope later said he'd give her a "four out of 10" grade because she didn't fully explain Clear's anti-dandruff benefits, and she pushed the promotion -- buy the bottle and get a free mini-bottle -- rather than the brand, even though Clear isn't a value shampoo for Unilever. The takeaway: Mr. Jope sees the need for a steady supply of well-trained promoters rather than outsourcing to poorly trained hires.
Overall, Mr. Jope came away satisfied that the Chinese consumer is steadily moving toward quality multinational brands. "She's proud of where she is and what she has achieved. This was a sharp reminder of how independent Chinese women are in urban markets."
http://adage.com/globalnews/article?article_id=142885
Tuesday, March 23, 2010
P&G Plots Growth Path Through Services
In Brand-Saturation Age, Major Marketers Turn to Franchising and Other Models
By Jack Neff
Published: March 22, 2010
BATAVIA, Ohio (AdAge.com) -- Procter & Gamble Co. got to be an $80 billion company and the world's-largest marketer almost entirely by selling goods, but it's increasingly looking to services ranging from concierge physicians to car washes and dry cleaners to fuel its thirst for growth.
It's a big thirst. When every percentage point of growth now requires around $800 million in new sales, P&G can't afford to leave many stones unturned, including service and franchising models. At the same time, the challenge in this age of brand saturation -- to create growth beyond simply selling more stuff -- is a problem other marketers will increasingly face if the economic recession indeed moves people away from the conspicuous consumption that marked better times.
Chairman-CEO Bob McDonald sees the service mentality increasingly infusing what his conventional package-goods brands do.
"I think service is yet an untapped area for us," Mr. McDonald said in a January interview. "We're active in franchising now with Mr. Clean car washes and Tide Dry Cleaners. MDVIP [concierge physician service] is a service operation. But we're also working on services on our existing brands, for example, where you walk up to the shelf, take a picture of the UPC code on your phone, and you can download information about the ingredients in that product, which you as an environmentalist may care about."
P&G is far from the only mega-marketer increasingly expanding its business model in a search for growth. P&G's biggest customer, retail behemoth Walmart, last month bought video streaming startup Vudu and last week announced it opened its 1000th MoneyCenter check-cashing and bill-payment outlet and plans to open another 500. Google, when it's not organizing all the world's information, is entering all the world's digital and media categories. And Apple, having become the world's-largest music retailer, looks to become a dominant presence in book and magazine publishing as well via the iPad.
Curious bets
Mr. McDonald said service is "part of our broader purpose," noting, "It's fair game for us, and we need to learn more about it. We've got to grow; that's the main thing."
While being big has the drawback of requiring big numbers to generate growth, he said, it also means P&G can afford to "place some bets that might not be so obvious from the outside."
One of those is MDVIP, a concierge-physician service in which participating primary-care doctors cut their patient loads roughly 75% to 600 patients or fewer. They provide premium service that includes annual hourlong physicals, electronic medical records on a CD, personal websites and preventive-care plans and the promise of on-time appointments for a $1,500 to $1,800 annual fee.
P&G bought 49% of MDVIP in 2007 as it looked to explore new avenues in health care as its own and other prescription-drug businesses slowed. Late last year it bought the other 51%, so far making a profit on the investment, Mr. McDonald said, though P&G is not really interested in the short-term trade.
HOW MUCH DOES IT COST?
Franchisees of Procter & Gamble's Mr. Clean Car Washes need a $2 million to $4 million total investment and net worth of at least $2.5 million. Tide Dry Cleaners require investments of $652,000 to $897,000 and a net worth of $1 million. Both appear pricier than some other operators, though with far more involved service propositions.
By comparison, Burger King requires a $1.2 million to $2.2 million investment for franchisees and $1.5 million in net worth. P&G's royalties of 6% to 7% and marketing fees of 5% of gross sales are both north of Burger King's 4% and 4.5%, respectively.
"If you're serious about being in the health-care business, what better learning lab is there than a concierge medical practice where you learn about everybody's aches and pains, and you work on developing the future of medicine, which is consumer choice and prevention rather than cure?" Mr. McDonald said.
Growth
P&G put Dan Hecht, who had been VP-North America of the pharmaceutical business the company divested last year, in charge of MDVIP as CEO. MDVIP is still relatively small, with 350 participating physicians among 250,000 primary-care doctors in the U.S. But at 115,000 patients, its count has more than doubled in three years.
For Mr. Clean, P&G now has 15 company-owned and franchise car washes in Cincinnati and Atlanta and plans to expand franchises in those cities, Illinois and Texas. Tide Dry Cleaners, now in Kansas City, Mo., recently started seeking franchisees in Cincinnati, Dayton, Columbus and Lexington, Ky.
P&G's service concepts aren't for the faint of heart or light of wallet. All three are premium propositions both for consumers and franchisees alike at a time when credit for small businesses remains tight. But in an e-mail, Nathan Estruth, VP of FutureWorks, said P&G has gotten considerable interest in franchise opportunities in all the markets it's approaching.
Like concierge medical care, the car washes and dry cleaners are high-service concepts, too. Mr. Clean Car Washes offer a wide array of detailing options -- Febreze odor eliminators, oil changes and other vehicle maintenance in many cases -- and lounges with big-screen TVs, Wi-Fi and areas where kids can remotely spray cars with suds soakers. Tide Dry Cleaners offer drive-through concierge service, customer lockers, on-site tailoring, 24-hour drop boxes, a customer-rewards program and a green-positioned cleaning process.
It takes scale, strategy and commitment
Procter & Gamble is no stranger to services. A decade ago, the company tested such projects as Juvian, a high-end fabric care "spa," and Culinary Sol, a cooking school. It even tried business consulting, seeking to license P&G marketing tips via a venture dubbed Emmperative.
All those ultimately got shuttered or sold. But there's a difference this time around for P&G in terms of scale, strategy and commitment.
In the case of Tide and Mr. Clean, P&G is putting the power of established half-billion-dollar or billion-dollar package-goods brands behind service concepts. And all three of the service concepts have moved well beyond the one- or two-store pilot stage where Juvian and Culinary Sol ended.
Mr. Clean bought an Atlanta car-wash chain and put its owner, Bruce Arnett Sr., in charge of the entire unit as CEO. As such, Mr. Clean already ranks as the No. 22 chain in the highly fragmented car-wash industry, and, by P&G's reckoning, the largest car-wash franchiser.
The payoff is potentially huge. Professional car-washing is a $20 billion-plus industry by P&G and industry estimates, with dry cleaning estimated at $9 billion. And the figures for MDVIP, its concierge physician service, are equally large: People make more than 400 million visits to primary-care physicians each year in the U.S., per the Centers for Disease Control, which, at an average cost of $100, would put that market at over $40 billion.
Capturing 1% of the revenue from those markets would give P&G a $700 million business that approaches adding a percentage point to the corporate top line.
Today, MDVIP alone, with 200 employees, apparently generates $170 million to $200 million in membership fees from patients to member doctors, though it's unclear how much of that flows through to the company. MDVIP offers physicians research, technological operational and marketing support as well as insurance and regulatory services, but declined to say exactly how it makes money.
http://adage.com/article?article_id=142898
By Jack Neff
Published: March 22, 2010
BATAVIA, Ohio (AdAge.com) -- Procter & Gamble Co. got to be an $80 billion company and the world's-largest marketer almost entirely by selling goods, but it's increasingly looking to services ranging from concierge physicians to car washes and dry cleaners to fuel its thirst for growth.
It's a big thirst. When every percentage point of growth now requires around $800 million in new sales, P&G can't afford to leave many stones unturned, including service and franchising models. At the same time, the challenge in this age of brand saturation -- to create growth beyond simply selling more stuff -- is a problem other marketers will increasingly face if the economic recession indeed moves people away from the conspicuous consumption that marked better times.
Chairman-CEO Bob McDonald sees the service mentality increasingly infusing what his conventional package-goods brands do.
"I think service is yet an untapped area for us," Mr. McDonald said in a January interview. "We're active in franchising now with Mr. Clean car washes and Tide Dry Cleaners. MDVIP [concierge physician service] is a service operation. But we're also working on services on our existing brands, for example, where you walk up to the shelf, take a picture of the UPC code on your phone, and you can download information about the ingredients in that product, which you as an environmentalist may care about."
P&G is far from the only mega-marketer increasingly expanding its business model in a search for growth. P&G's biggest customer, retail behemoth Walmart, last month bought video streaming startup Vudu and last week announced it opened its 1000th MoneyCenter check-cashing and bill-payment outlet and plans to open another 500. Google, when it's not organizing all the world's information, is entering all the world's digital and media categories. And Apple, having become the world's-largest music retailer, looks to become a dominant presence in book and magazine publishing as well via the iPad.
Curious bets
Mr. McDonald said service is "part of our broader purpose," noting, "It's fair game for us, and we need to learn more about it. We've got to grow; that's the main thing."
While being big has the drawback of requiring big numbers to generate growth, he said, it also means P&G can afford to "place some bets that might not be so obvious from the outside."
One of those is MDVIP, a concierge-physician service in which participating primary-care doctors cut their patient loads roughly 75% to 600 patients or fewer. They provide premium service that includes annual hourlong physicals, electronic medical records on a CD, personal websites and preventive-care plans and the promise of on-time appointments for a $1,500 to $1,800 annual fee.
P&G bought 49% of MDVIP in 2007 as it looked to explore new avenues in health care as its own and other prescription-drug businesses slowed. Late last year it bought the other 51%, so far making a profit on the investment, Mr. McDonald said, though P&G is not really interested in the short-term trade.
HOW MUCH DOES IT COST?
Franchisees of Procter & Gamble's Mr. Clean Car Washes need a $2 million to $4 million total investment and net worth of at least $2.5 million. Tide Dry Cleaners require investments of $652,000 to $897,000 and a net worth of $1 million. Both appear pricier than some other operators, though with far more involved service propositions.
By comparison, Burger King requires a $1.2 million to $2.2 million investment for franchisees and $1.5 million in net worth. P&G's royalties of 6% to 7% and marketing fees of 5% of gross sales are both north of Burger King's 4% and 4.5%, respectively.
"If you're serious about being in the health-care business, what better learning lab is there than a concierge medical practice where you learn about everybody's aches and pains, and you work on developing the future of medicine, which is consumer choice and prevention rather than cure?" Mr. McDonald said.
Growth
P&G put Dan Hecht, who had been VP-North America of the pharmaceutical business the company divested last year, in charge of MDVIP as CEO. MDVIP is still relatively small, with 350 participating physicians among 250,000 primary-care doctors in the U.S. But at 115,000 patients, its count has more than doubled in three years.
For Mr. Clean, P&G now has 15 company-owned and franchise car washes in Cincinnati and Atlanta and plans to expand franchises in those cities, Illinois and Texas. Tide Dry Cleaners, now in Kansas City, Mo., recently started seeking franchisees in Cincinnati, Dayton, Columbus and Lexington, Ky.
P&G's service concepts aren't for the faint of heart or light of wallet. All three are premium propositions both for consumers and franchisees alike at a time when credit for small businesses remains tight. But in an e-mail, Nathan Estruth, VP of FutureWorks, said P&G has gotten considerable interest in franchise opportunities in all the markets it's approaching.
Like concierge medical care, the car washes and dry cleaners are high-service concepts, too. Mr. Clean Car Washes offer a wide array of detailing options -- Febreze odor eliminators, oil changes and other vehicle maintenance in many cases -- and lounges with big-screen TVs, Wi-Fi and areas where kids can remotely spray cars with suds soakers. Tide Dry Cleaners offer drive-through concierge service, customer lockers, on-site tailoring, 24-hour drop boxes, a customer-rewards program and a green-positioned cleaning process.
It takes scale, strategy and commitment
Procter & Gamble is no stranger to services. A decade ago, the company tested such projects as Juvian, a high-end fabric care "spa," and Culinary Sol, a cooking school. It even tried business consulting, seeking to license P&G marketing tips via a venture dubbed Emmperative.
All those ultimately got shuttered or sold. But there's a difference this time around for P&G in terms of scale, strategy and commitment.
In the case of Tide and Mr. Clean, P&G is putting the power of established half-billion-dollar or billion-dollar package-goods brands behind service concepts. And all three of the service concepts have moved well beyond the one- or two-store pilot stage where Juvian and Culinary Sol ended.
Mr. Clean bought an Atlanta car-wash chain and put its owner, Bruce Arnett Sr., in charge of the entire unit as CEO. As such, Mr. Clean already ranks as the No. 22 chain in the highly fragmented car-wash industry, and, by P&G's reckoning, the largest car-wash franchiser.
The payoff is potentially huge. Professional car-washing is a $20 billion-plus industry by P&G and industry estimates, with dry cleaning estimated at $9 billion. And the figures for MDVIP, its concierge physician service, are equally large: People make more than 400 million visits to primary-care physicians each year in the U.S., per the Centers for Disease Control, which, at an average cost of $100, would put that market at over $40 billion.
Capturing 1% of the revenue from those markets would give P&G a $700 million business that approaches adding a percentage point to the corporate top line.
Today, MDVIP alone, with 200 employees, apparently generates $170 million to $200 million in membership fees from patients to member doctors, though it's unclear how much of that flows through to the company. MDVIP offers physicians research, technological operational and marketing support as well as insurance and regulatory services, but declined to say exactly how it makes money.
http://adage.com/article?article_id=142898
Saturday, March 13, 2010
How P&G Brought the Diaper Revolution to China
When Procter & Gamble set out to sell Pampers in China more than a decade ago, it faced a daunting marketing challenge: P&G didn’t just have to persuade parents that its diapers were the best. It had to persuade many of them that they needed diapers at all. The disposable diaper — a throwaway commodity in the West — just wasn’t part of the cultural norm in the Chinese nursery. Babies wore cloth diapers, or in many cases, no diaper at all. And that, says Bruce Brown, who’s in charge of P&G’s $2 billion R&D budget, is why China presented — and still presents — such a huge opportunity.
Today, after years of exhaustive research and plenty of missteps, Pampers is the No. 1-selling diaper in China and the company, in many ways, is just getting started there. The diaper market in China is booming. It stands at $1.4 billion — roughly a quarter the size of the U.S. market — and is projected to grow 40 percent over the next few years, according to research firm Datamonitor.
P&G’s success in China has helped CEO Bob McDonald set some bold goals. Last October, he laid out a plan to add one billion customers over the next five years by promoting P&G brands throughout some of the poorest corners of the world. How will P&G go about doing that? To get a sense, just look at the way it cracked — and to a large degree created — the market for disposable diapers in China.
Learning From Failure
When P&G first launched Pampers in China in 1998, the effort flopped. Instead of developing a unique product for the market, P&G made a lower-quality version of U.S. and European diapers, wrongly assuming that parents would buy them if they were cheap enough. “It just didn’t work,” Brown says.
It didn’t help that Chinese families had always gotten along just fine without disposable diapers. There, potty training often begins as early as six months, and children wear what’s called kaidangku — colorful open-crotch pants that let them squat and relieve themselves in open areas.
Pampers’ pitch wasn’t compelling people to try something new — and neither was the product itself. “We scrimped on the softness in the earlier versions,” says Kelly Anchrum, director of global baby care, external relations, and sustainability. “It had a more plasticky feel. It took us awhile to figure out that softness was just as important to moms in a developing market.”
P&G had tried a similarly watered-down approach earlier in the decade, when it launched laundry and hair-care brands in several emerging markets. Those products also failed, Brown says. After these experiences, the company in 2001 came up with a new approach to product development: “Delight, don’t dilute.” In other words, the diaper needed to be cheap, but it also had to do what other cheap diapers didn’t — keep a baby dry for 10 hours and be as comfortable as cloth.
So P&G added softness, dialed down the plastic feel, and increased the absorption capability of the diaper. To bring down the cost, the company developed more efficient technology platforms and moved manufacturing operations to China to eliminate shipping costs.
The revamped diaper, Pampers Cloth Like & Dry, hit retail shelves in China’s largest cities in 2006, selling for the equivalent of 10 cents in local currency, less than half the cost of a Pampers diaper in the United States.
The Universal Pitch
P&G had the right diaper and the right price point. Now it faced the bigger challenge. “You have to convince someone that they need this thing,” says Ali Dibadj, an analyst who covers P&G at Sanford C. Bernstein & Co.
For Frances Roberts, global brand franchise leader for Pampers, every trip to China was (and still is) an opportunity to learn more about Chinese nursery habits. It’s part of the P&G ethos that brand leaders visit consumers in their own homes — something Roberts has done in dozens of countries, including Germany, Russia, and Jakarta. The goal is to uncover the nuances of each market, and early on in its diaper research P&G discovered a universal need. “Moms say the same things over and over,” Roberts says. Their cry: We want more sleep.
With the help of the Beijing Children’s Hospital’s Sleep Research Center, P&G researchers conducted two exhaustive studies between 2005 and 2006, involving 6,800 home visits, and more than 1,000 babies throughout eight cities in China. Instead of cloth, the research subjects were tucked into bed with Pampers. The results: P&G reported that the babies who wore the disposables fell asleep 30 percent faster and slept an extra 30 minutes every night. The study even linked the extra sleep to improved cognitive development, a compelling point in a society obsessed with academic achievement.
P&G then put its marketing machine into motion. Pampers launched the “Golden Sleep” campaign in 2007, which included mass carnivals and in-store campaigns in China’s biggest urban areas. A viral campaign on the Pampers Chinese web site asked parents to upload photos of their sleeping babies to drive home the study’s sleep message. The response was impressive: 200,000 photos, which P&G used to create a 660-square-meter photomontage at a retail store in Shanghai. The ad campaign boasted “scientific” results, such as “Baby Sleeps with 50% Less Disruption” and “Baby Falls Asleep 30% Faster.”
No diaper brand, not even rival Kimberly-Clark, maker of Huggies, has come close to spending as much on advertising in China, according to CTR Market Research, the China-based division of American media researcher TNS Media Intelligence. Since 2006, Pampers’ measured media spend topped 3.2 billion yuan, or about $476 million — more than three times as much as any other brand. In 2009 alone, P&G spent $69 million, compared to Kimberly-Clark’s $12 million spend for Huggies.
Ruling the Nursery — in China and Around the World
Today, Pampers is the top-selling brand in China, a country where about a decade ago the disposable diaper category hardly existed. P&G does not release sales figures for specific countries, but Datamonitor estimates that the company has captured more than 30 percent of the $1.4 billion market.
Karl Gerth, an Oxford professor who researches the spread of consumerism in China, says P&G’s marketing campaigns strike the right tone. “You don’t want to come off as paternalistic,” says Gerth, who wrote the book “China Made: Consumer Culture and the Creation of the Nation.” “The idea that Pampers brings a scientific backing and gives children an edge in their environment — that’s a brilliant way to stand out from the competition.”
You could argue that it’s easy being No. 1 when the market is still small. But P&G still has a lot of work to do. The company faces challenges from private-label and domestic brands, including the No. 2 market leader, Hengan International Group, which has steadily grown its market share to 20 percent. Local brands, meantime, are catching up with better products, marketing, and distribution. “Chinese consumers are going to want to root for the home team,” Gerth says.
And there’s still the challenge of making disposables a habit. On average, diaper use still amounts to less than one a day. “We’ve only just begun to scratch the surface [in China],” Dimitri Panayotopoulos, vice chairman of global household care, told investors in a 2008 analyst meeting.
There’s even bigger potential in India, where the birth rate is almost double that of China but the diaper market remains tiny at about $43.4 million. (Pampers is the top-selling brand there, too.) So now, P&G plans to take the sleep argument throughout rural and poor areas in India and elsewhere. The company also makes its case by positioning itself as a baby-care educator. Pampers sponsors healthcare-outreach programs such as a rural immunization program in China and mobile medical-care vans in Pakistan and Morocco. In India, there’s a door-to-door program that offers baby-care tips and diaper samples for moms.
Of course, P&G tweaks the sales pitch to fit different markets; that’s what the company is known for. In India, for instance, the convenience of disposable diapers doesn’t resonate with parents. The company’s consumer research found that many Indian mothers think that only lazy moms put their babies in disposable diapers that last a full night. As Pampers brand manager Vidya Ramachandran reported in an internal video shown to employees, “We really had to change that mindset and educate [mothers] that using a diaper is not about convenience for you — it’s about your baby’s development.”
The Ultimate Dye Job
A.G. Lafley prefers khakis over Armani and systems over charisma. But despite his soft-spoken style, Lafley’s transformation of Procter & Gamble made him a star in business circles, as he earned a reputation as one of the country’s most effective CEOs. Chief Executive magazine named him CEO of the Year in 2006, and during his tenure P&G made enormous strides in innovation and financial performance.
That is somewhat ironic because business was not Lafley’s first love. A graduate of Hamilton College, he was studying for a doctorate in European medieval and renaissance history at the University of Virginia when he joined the Navy. He spent much of his five-year military career running retail operations at a large military base in Japan. The experience intrigued him enough that he forsook renaissance history for Harvard Business School.
Joining P&G in 1977, Lafley started as a brand manager for Joy dishwashing liquid; he went on to posts in the laundry, cleaning products and advertising divisions. A stint in Asia proved particularly influential, instilling a love for design that he brought back to Cincinnati in 1998, when he became president of the North American business unit. In 1999, Lafley added global beauty care to his portfolio; and in 2000, he became president and CEO. Though he stepped down as CEO in June 2009, he is still chairman of the board.
In this interview with BNET, Lafley describes the decisions that went into buying Clairol, the first major acquisition of his tenure.
That is somewhat ironic because business was not Lafley’s first love. A graduate of Hamilton College, he was studying for a doctorate in European medieval and renaissance history at the University of Virginia when he joined the Navy. He spent much of his five-year military career running retail operations at a large military base in Japan. The experience intrigued him enough that he forsook renaissance history for Harvard Business School.
Joining P&G in 1977, Lafley started as a brand manager for Joy dishwashing liquid; he went on to posts in the laundry, cleaning products and advertising divisions. A stint in Asia proved particularly influential, instilling a love for design that he brought back to Cincinnati in 1998, when he became president of the North American business unit. In 1999, Lafley added global beauty care to his portfolio; and in 2000, he became president and CEO. Though he stepped down as CEO in June 2009, he is still chairman of the board.
In this interview with BNET, Lafley describes the decisions that went into buying Clairol, the first major acquisition of his tenure.
To dye or not to dye? We spent a long time in purgatory on this. Beginning in the 1990s, we started working on hair colorants, looking at everything from the chemistry to the product formulation to understanding the consumer experience. We saw this as a sleepy category; there hadn’t been much product change for decades. Also, we did a lot of in-home, one-on-one research. What we found, by spending entire days with women, was that hair coloring was inconvenient, messy and, frankly, a little bit scary. You were dealing with things that bleached your hair, and then things that dyed it. P&G already had superior conditioning and safer bleach; if we could just nail the dye part of the coloring, we would be in.
- When I came back from Asia in 1998, we were still working on this and brought what we had into consumer testing. It didn’t deliver — the brand, the concepts, none of it was very exciting. It became quite clear we were not creating anything new that was as strong as what L’Oreal and Clairol already had. That was a real blow.
The stark reality is that you learn more from failure than you ever do from success. The key is to learn from that failure and to fail early and cheaply. And we did learn from that exercise, and everyone understood why we had not succeeded. It laid the path to our success in this category later on.
In 1999, I picked up the global beauty business unit as part of my portfolio. The question I faced was whether to bury the whole [hair color] thing. I knew we had learned a lot, and I thought we had a good lead on the product and technology side. But I also realized that a new brand had a low probability of success. The category was a walled city, with L’Oreal the biggest wall.
It came down to two things. First, we knew that there were unmet consumer needs in terms of performance, convenience and the overall experience; and second, we had a coloring technology that looked promising. With that in mind, I made the first major decision — not to give up on the category. The question was how to enter it.
- Making the case for Clairol
Then in early 2001 Bristol-Myers Squibb put Clairol on the block. Should we buy it?
At the time, our technology was not ready to go, but we couldn’t affect the timing of the auction; the business was for sale when it was for sale. I thought we should go for it. The board, though, was a little skittish and plenty skeptical. I had to sell them.
We met in the boardroom at P&G’s headquarters in Cincinnati. I went in with one or two overheads. I wanted to have a discussion, not a slideshow, and we did. The members of the board challenged me on my market assumptions, the investment situation, and our assessment of consumer opportunity. I was also probed on the technology and product and pushed real hard on what we had that was proprietary. Could we do what we said we could do?
I made the case that hair care was a core business. P&G was then the leader in shampoo and on the verge of becoming the leader in conditioning and treatment. The next two big segments, as I saw it, were styling and colorants.
I told them we had been working on colorants for years and that we were close to a superior, proprietary product. Then I laid out the consumer behavior. There were more women coloring, and they were starting to color younger. And because women were living longer, they were going to color longer — once you start to color, you color to the end. The market was growing faster than other hair markets. All the trends looked good. We also knew a lot about the consumer — things the competitors were not acting on.
Then I had to deal with the brand issue. Clairol was a good No. 2 — behind L’Oreal —that we could build on. Nice n’ Easy [Clairol’s major coloring brand] still had a lot of brand equity, but it had been neglected. It sort of had become your grandmother’s brand. I thought that with our marketing expertise, we could do something with it.
At the end of about three hours, a majority of the board agreed with me that there was enough equity in the Clairol brand, and that we had enough equity on the consumer side, to make it worth bidding for. They bought the argument and we agreed on a price to offer. It was an incredible vote of confidence in the small team working on this — and in me.
Convincing the board, round II
On Friday around 6 pm, I got a phone call: We had lost. I asked Peter Dolan, who was running Bristol-Myers Squibb at the time, “Will you give us 48 hours for a best and final offer?” He said, no, he had a good offer. I argued that he had nothing to lose; if our bid comes in lower, you have the other offer in hand. If it’s higher, you’re going to get more money, and look like a hero. He said, OK, you have until 8 on Monday morning.
We worked all day Saturday; on Sunday, we had a board meeting. This one was by phone, and no, people were not happy to have to give up a Sunday afternoon. For another three hours, we debated and discussed how high we could go. The questions were even tougher this time, about the competitive situation and the market. Those who were skeptical were even more skeptical. Finally, we agreed to increase the offer.
We got the revised offer to Peter Dolan the next morning; he called me back in an hour or two to accept; we ended up paying $4.95 billion. Then we had to do the contract in something like 24 hours.
On Tuesday morning, when we signed the contract in New York, one of our best attorneys was asleep in her chair in a corner, and one of the finance guys was asleep on the floor. And of course, that was just the beginning. Then we had to deal with the regulatory agencies, and integration, and making it work.
Friday, March 12, 2010
Why Most CEOs Are Bad at Strategy
5:00 PM Wednesday January 6, 2010
by Roger Martin
There is a lot of strategy in the world, produced by all types of CEOs, corporate heads of strategy, and strategy consultants. Yet very little of this strategy is any good. There are undoubtedly many possible explanations for why this is the case, but here is my own pet theory, which I offer up to elicit your reactions and surface alternatives:
A good strategy is the product of the creative combination of two disparate logics — rather than a single linear analytical logic flow — but CEOs and "strategists" are seldom conditioned to become skilled at the requisite creative combination.
The two most fundamental strategic choices are deciding where to play and how to win. These two decisions — in what areas will the company compete, and on what basis will it do so — are the critical one-two punch to generate strategic advantage. However, they can't be considered independently or sequentially. In a great strategy, your where-to-play and how-to-win choices fit together and reinforce one another.
For example, operating only in your home country market may seem to be a perfectly fine where-to-play choice and winning on the basis of technological superiority a perfectly fine how-to-win choice, but their combination almost always produces a bad strategy — because of global economies of scale in R&D, some competitor will globalize and blow out the geographically narrow national player. These choices don't fit or reinforce.
In contrast, Apple wins because its where-to-play choice — broad participation across a number of high-involvement consumer electronics categories (computers, music, phones) — is matched wonderfully with its how-to-win choice — competing on user experience design and eco-system orchestration. It leverages the winning capabilities it has built in these two areas across the domains in which it has chosen to play to produce its winning Macs, iPods, and iPhones.
The trouble is, CEOs don't usually get to the top by integrating different logics in that way. More often they rise by pushing a single logic. They like to analyze a problem and come up with a single, sufficient answer, like how to globalize or get costs under control or introduce a new product, rather than trying to look for answers to two questions that fit together elegantly.
As a consequence, many of them come to think of strategy as either where-to-play or how-to-win. For example, in the global pharma industry today, it appears that most CEOs define their strategies as simply playing in the historically lucrative pharma industry and doing whatever the rest of their competitors do. This is silent on how-to-win and the resultant set of me-too strategies is one reason why performance in the industry is going downhill fast.
Or alternatively, for many high-tech CEOs, the dominant choice is to win with a proprietary technology. This is silent on where-to-play and that has led many technology companies astray because it really matters where exactly that technology is used — as we see with Nortel Networks, which is now in the bankruptcy court despite its treasure trove of technology patents.
Meanwhile, corporate strategists and strategy consultants get ahead by demonstrating mastery of all sorts of conceptual tools for analyzing where-to-play (five forces, profit maps, etc.) or how-to-win (experience curve, value chain, VIRO, etc.). However, there as yet is no analytical tool for combining a given where-to-play choice with a congenial how-to-win choice or vice versa. That takes creative insight. But the majority of people who seek to become corporate strategists or strategy consultants do so because they are much more comfortable with analysis than what they perceive as guesswork. So they tend to become expert at strategic analyses, not strategy.
That, I submit, is why CEOs and "strategists" so seldom produce good strategies. Strategy is a creative act and the way to produce good strategy is go beyond basic analysis to creatively integrate your choices concerning where you play and how you propose to win.
Roger Martin is the Dean of the Rotman School of Management at the University of Toronto in Canada and the author of The Design of Business: Why Design Thinking is the Next Competitive Advantage (Harvard Business Press, 2009).
http://blogs.hbr.org/cs/2010/01/why_most_ceos_are_bad_at_strat.html?cm_mmc=npv-_-MANAGEMENT_TIP-_-MAR_2010-_-MTOD0309&referral=00203
by Roger Martin
There is a lot of strategy in the world, produced by all types of CEOs, corporate heads of strategy, and strategy consultants. Yet very little of this strategy is any good. There are undoubtedly many possible explanations for why this is the case, but here is my own pet theory, which I offer up to elicit your reactions and surface alternatives:
A good strategy is the product of the creative combination of two disparate logics — rather than a single linear analytical logic flow — but CEOs and "strategists" are seldom conditioned to become skilled at the requisite creative combination.
The two most fundamental strategic choices are deciding where to play and how to win. These two decisions — in what areas will the company compete, and on what basis will it do so — are the critical one-two punch to generate strategic advantage. However, they can't be considered independently or sequentially. In a great strategy, your where-to-play and how-to-win choices fit together and reinforce one another.
For example, operating only in your home country market may seem to be a perfectly fine where-to-play choice and winning on the basis of technological superiority a perfectly fine how-to-win choice, but their combination almost always produces a bad strategy — because of global economies of scale in R&D, some competitor will globalize and blow out the geographically narrow national player. These choices don't fit or reinforce.
In contrast, Apple wins because its where-to-play choice — broad participation across a number of high-involvement consumer electronics categories (computers, music, phones) — is matched wonderfully with its how-to-win choice — competing on user experience design and eco-system orchestration. It leverages the winning capabilities it has built in these two areas across the domains in which it has chosen to play to produce its winning Macs, iPods, and iPhones.
The trouble is, CEOs don't usually get to the top by integrating different logics in that way. More often they rise by pushing a single logic. They like to analyze a problem and come up with a single, sufficient answer, like how to globalize or get costs under control or introduce a new product, rather than trying to look for answers to two questions that fit together elegantly.
As a consequence, many of them come to think of strategy as either where-to-play or how-to-win. For example, in the global pharma industry today, it appears that most CEOs define their strategies as simply playing in the historically lucrative pharma industry and doing whatever the rest of their competitors do. This is silent on how-to-win and the resultant set of me-too strategies is one reason why performance in the industry is going downhill fast.
Or alternatively, for many high-tech CEOs, the dominant choice is to win with a proprietary technology. This is silent on where-to-play and that has led many technology companies astray because it really matters where exactly that technology is used — as we see with Nortel Networks, which is now in the bankruptcy court despite its treasure trove of technology patents.
Meanwhile, corporate strategists and strategy consultants get ahead by demonstrating mastery of all sorts of conceptual tools for analyzing where-to-play (five forces, profit maps, etc.) or how-to-win (experience curve, value chain, VIRO, etc.). However, there as yet is no analytical tool for combining a given where-to-play choice with a congenial how-to-win choice or vice versa. That takes creative insight. But the majority of people who seek to become corporate strategists or strategy consultants do so because they are much more comfortable with analysis than what they perceive as guesswork. So they tend to become expert at strategic analyses, not strategy.
That, I submit, is why CEOs and "strategists" so seldom produce good strategies. Strategy is a creative act and the way to produce good strategy is go beyond basic analysis to creatively integrate your choices concerning where you play and how you propose to win.
Roger Martin is the Dean of the Rotman School of Management at the University of Toronto in Canada and the author of The Design of Business: Why Design Thinking is the Next Competitive Advantage (Harvard Business Press, 2009).
http://blogs.hbr.org/cs/2010/01/why_most_ceos_are_bad_at_strat.html?cm_mmc=npv-_-MANAGEMENT_TIP-_-MAR_2010-_-MTOD0309&referral=00203
Thursday, March 11, 2010
P&G Pushes 'Store Back'
If it doesn't work in the store, it doesn't work. Sounds simple enough, but this idea is at the core of The Procter & Gamble Co.'s latest rallying cry known as Store Back, introduced by Marc Pritchard when he took the helm as global marketing officer in mid-2008 (his role has since expanded to global brand-building officer).
Described by the consumer goods giant as a "mindset" (although others would argue it's much more than that), Store Back reaffirms and strengthens P&G's famous First Moment of Truth (FMOT) mentality, putting an even greater emphasis on shopper marketing and winning at the shelf.
In essence, "[Store Back] reorients our thinking as we're developing big ideas for our brands," explains global design officer Phil Duncan. "We're asking our brand teams to first really start with the store in mind as they evaluate their big ideas, because what we have found is we actually develop better big ideas if we think about the store first and work our way back."
This is a reversal of the way CPGs and their agencies have traditionally approached marketing campaigns, which meant starting with TV or print applications and then adapting them to fit the store. "In the past, [the store] would have been our third or fourth consideration," Duncan says.
However, P&G's agency partners clarify that just because campaigns are constructed with the store in mind doesn't mean the in-store execution is necessarily tackled first. "It's not about starting with the store; you still start with the idea," says Andy Murray, global CEO at Saatchi & Saatchi X, Springdale, Ark. "But what you do is make sure that idea can really work in the store environment and you can put legs on it from a shopper perspective as well as you can some of the other important touchpoints."
Schooling Agencies
In addition to ingraining the Store Back mentality internally, Procter & Gamble also has to make sure all of its agency partners are on board and understand how it affects their working relationship. "It probably is a relatively significant shift for those that were more oriented toward delivering television ideas or print ideas," says Duncan. "For others, I think it's a natural component of how they've always worked."
One significant change is how agencies are expected to present new campaign ideas. "As our agency partners are developing our big ideas, they are [expected to present] it first and foremost through the lens of the store," Duncan says. "If the communication idea does not or is difficult to translate in-store, we're asking our agency partners to go back in and enhance the idea because if it doesn't work in-store, we know it's not going to work."
As shopper marketing agencies, Saatchi & Saatchi X and New York-based G2 (both P&G partners) may have an easier time adapting to Store Back. But they agree the mindset brings more clarity and focus to their work. "When you start putting Store Back filters on the ideas, you really test an idea to see if you can get it down to its simplest form," says Saatchi's Murray.
Store Back has also allowed Saatchi X to start working on campaigns earlier in the planning process. "We're getting involved in many more upstream conversations, which is a good thing," Murray says. "[We're able] to see if it will really work from a store standpoint before we get too far down the road."
Because P&G works with a number of agencies, this mindset requires them to collaborate even more to ensure everyone is on the same page. "It entails a change in process and it entails a change in the way that the agencies work together. There needs to be more collaboration and there needs to be more focus on a medium (the store) that most agencies have little experience in," says Ann Mooney, who worked at P&G for 18 years before launching her own company, Rising Moon Consulting, based in Cincinnati.
Mooney says in her experience, there are a stable of agency partners -- as many as seven to nine -- that need to collaborate with the brand teams. "A packaging agency, an in-store agency, TV/print, online, direct marketing, etc.; it's a lot of agencies that need to be singing off the same sheet of music."
Those familiar with Store Back also believe it is beneficial for P&G's retail customers. "The emphasis on Store Back certainly should help retailers because what it's really doing is taking on board and attaching importance to their customers -- the shopper," says Jonathan Dodd, chief strategy officer at G2.
Murray says many campaigns executed under this framework have already proven to be cleaner, more compelling and clearer to the shopper. "What Store Back is doing is getting us better assets to work with at store level that talk to shoppers in ways that she understands," he says. "Without it, what you really get into is trying to force-fit a 30-second [TV] idea into a three-second space, and that really doesn't work."
Mooney agrees. "In the store environment, one of your objectives is to get them to buy now. And your objective with the TV spot is to get in their consideration set." In both mediums, you want to provide a head nod to the creative idea, she says, but in-store the idea should be about the product's core benefits.
Store Back in Action
Perhaps the best way to understand Store Back is to look at campaigns that were executed with it in mind. One often-cited example is Pampers' partnership with Unicef, in which proceeds helped provide tetanus vaccines for mothers and their newborns in third-world countries.
"If you put that in a big-picture framework, you can touch millions and millions of people by buying Pampers. But then when you start trying to tell that story at the store level, where she only has a few seconds and she's trying to decide, you have to simplify it," says Murray. The simplified message of "1 pack = 1 vaccine" was featured on Pampers packaging and displays, and was also used online and in other marketing efforts. In the end, the campaign achieved its goal of providing funding for 31 million vaccines.
To show how Store Back thinking applies to another product category, Duncan cites Gain's "Love at first sniff" campaign. Drawing on the insight that most shoppers are not comfortable opening a bottle of laundry detergent to smell it in-store, Procter & Gamble created P-O-P materials that encouraged shoppers to "crack the cap to fall in love." From there, "a whole cadre of supporting materials developed," Duncan says, including TV commercials, print ads, online executions and public relations efforts.
"It really was thinking about the [Gain] campaign in a macro sense, but thinking Store Back for the first executions around those 'crack the cap' insights that really drove consumer appeal for the brand," he says.
Although it launched before Store Back was officially announced, the CoverGirl LashBlast campaign featuring Drew Barrymore was conceived with the same core principles in mind. G2 was the digital and First Moment of Truth agency for this campaign, which had a large presence in-store.
"The execution at the retail level involved utilizing a big orange [mascara] tube, which was very visible in-store, very dramatic, and helped to attract the shopper's attention," says Dodd. "We featured in-store Drew Barrymore, which connected to the advertising, so there was a connection to the shopper and to the store from what they would have seen on TV."
The in-store pieces were tailored to fit the needs of CoverGirl's key retail customers based on an understanding of their shopper profiles and P-O-P guidelines. These marginally different executions remained consistent with the campaign's big idea of bold, beautiful lashes, resulting in a favorable share performance for the brand, Dodd says.
Beyond P&G
While the term "Store Back" belongs to Procter & Gamble, those interviewed agree the thinking behind it can apply to virtually any product category that is sold at retail. "Procter's done a great job of distilling it and aligning their organization [around Store Back], and others are doing it to similar or maybe slightly lesser degrees at the moment," Dodd says of G2's other clients.
Meanwhile, Mooney is consulting brand marketers and agencies on what she calls StoreFirst, defined as "creating marketing ideas first with the store in mind for better in-store impact and improved integrated 360-degree marketing." She agrees that this idea, which must go beyond a mindset to entail changes in process and ultimately become an operational discipline, applies to virtually any product "where in-store is really important in making their purchase decision."
Another important consideration is assessing and qualifying the in-store idea early in the process. "Don't just sit in the conference room and say, 'Yeah, I think that's pretty good.' Qualify it and test it with shoppers," Mooney says.
She stresses, though, that StoreFirst is not a formula. "It's not something that will look the same way at every company because it depends on the company's processes, their organization structure, etc. It's not one size fits all."
"It's especially important for categories that are confusing, that have a lot of SKUs, that have sort of high launch rates, where there's a lack of differentiation and there's a high risk of shopper decision failure," she adds.
Mooney also tells clients to take into account their key retailers' planning processes and calendars when they're thinking about launching new products, which Dodd agrees is one of the benefits of this mentality. "You're taking the idea more directly into the store, which arguably is going to be more powerfully communicated and more effective," he says. "You also think about the constraints of the store at the appropriate time in the process, so you can use them advantageously rather than be compromised by some of those constraints."
Although a Store Back or StoreFirst framework may look different depending on the company, Mooney asserts that this type of thinking "is just the next evolution for companies to say, 'Not only should you have expertise and know-how and processes relative to shopper marketing, but additionally you should think about the store more seminally -- more first -- and how your product comes to life in-store,' because the store really is the torture test. If it doesn't work in-store, it doesn't work."
http://www.shoppermarketingmag.com/articles/?nid=57444
Described by the consumer goods giant as a "mindset" (although others would argue it's much more than that), Store Back reaffirms and strengthens P&G's famous First Moment of Truth (FMOT) mentality, putting an even greater emphasis on shopper marketing and winning at the shelf.
In essence, "[Store Back] reorients our thinking as we're developing big ideas for our brands," explains global design officer Phil Duncan. "We're asking our brand teams to first really start with the store in mind as they evaluate their big ideas, because what we have found is we actually develop better big ideas if we think about the store first and work our way back."
This is a reversal of the way CPGs and their agencies have traditionally approached marketing campaigns, which meant starting with TV or print applications and then adapting them to fit the store. "In the past, [the store] would have been our third or fourth consideration," Duncan says.
However, P&G's agency partners clarify that just because campaigns are constructed with the store in mind doesn't mean the in-store execution is necessarily tackled first. "It's not about starting with the store; you still start with the idea," says Andy Murray, global CEO at Saatchi & Saatchi X, Springdale, Ark. "But what you do is make sure that idea can really work in the store environment and you can put legs on it from a shopper perspective as well as you can some of the other important touchpoints."
Schooling Agencies
In addition to ingraining the Store Back mentality internally, Procter & Gamble also has to make sure all of its agency partners are on board and understand how it affects their working relationship. "It probably is a relatively significant shift for those that were more oriented toward delivering television ideas or print ideas," says Duncan. "For others, I think it's a natural component of how they've always worked."
One significant change is how agencies are expected to present new campaign ideas. "As our agency partners are developing our big ideas, they are [expected to present] it first and foremost through the lens of the store," Duncan says. "If the communication idea does not or is difficult to translate in-store, we're asking our agency partners to go back in and enhance the idea because if it doesn't work in-store, we know it's not going to work."
As shopper marketing agencies, Saatchi & Saatchi X and New York-based G2 (both P&G partners) may have an easier time adapting to Store Back. But they agree the mindset brings more clarity and focus to their work. "When you start putting Store Back filters on the ideas, you really test an idea to see if you can get it down to its simplest form," says Saatchi's Murray.
Store Back has also allowed Saatchi X to start working on campaigns earlier in the planning process. "We're getting involved in many more upstream conversations, which is a good thing," Murray says. "[We're able] to see if it will really work from a store standpoint before we get too far down the road."
Because P&G works with a number of agencies, this mindset requires them to collaborate even more to ensure everyone is on the same page. "It entails a change in process and it entails a change in the way that the agencies work together. There needs to be more collaboration and there needs to be more focus on a medium (the store) that most agencies have little experience in," says Ann Mooney, who worked at P&G for 18 years before launching her own company, Rising Moon Consulting, based in Cincinnati.
Mooney says in her experience, there are a stable of agency partners -- as many as seven to nine -- that need to collaborate with the brand teams. "A packaging agency, an in-store agency, TV/print, online, direct marketing, etc.; it's a lot of agencies that need to be singing off the same sheet of music."
Those familiar with Store Back also believe it is beneficial for P&G's retail customers. "The emphasis on Store Back certainly should help retailers because what it's really doing is taking on board and attaching importance to their customers -- the shopper," says Jonathan Dodd, chief strategy officer at G2.
Murray says many campaigns executed under this framework have already proven to be cleaner, more compelling and clearer to the shopper. "What Store Back is doing is getting us better assets to work with at store level that talk to shoppers in ways that she understands," he says. "Without it, what you really get into is trying to force-fit a 30-second [TV] idea into a three-second space, and that really doesn't work."
Mooney agrees. "In the store environment, one of your objectives is to get them to buy now. And your objective with the TV spot is to get in their consideration set." In both mediums, you want to provide a head nod to the creative idea, she says, but in-store the idea should be about the product's core benefits.
Store Back in Action
Perhaps the best way to understand Store Back is to look at campaigns that were executed with it in mind. One often-cited example is Pampers' partnership with Unicef, in which proceeds helped provide tetanus vaccines for mothers and their newborns in third-world countries.
"If you put that in a big-picture framework, you can touch millions and millions of people by buying Pampers. But then when you start trying to tell that story at the store level, where she only has a few seconds and she's trying to decide, you have to simplify it," says Murray. The simplified message of "1 pack = 1 vaccine" was featured on Pampers packaging and displays, and was also used online and in other marketing efforts. In the end, the campaign achieved its goal of providing funding for 31 million vaccines.
To show how Store Back thinking applies to another product category, Duncan cites Gain's "Love at first sniff" campaign. Drawing on the insight that most shoppers are not comfortable opening a bottle of laundry detergent to smell it in-store, Procter & Gamble created P-O-P materials that encouraged shoppers to "crack the cap to fall in love." From there, "a whole cadre of supporting materials developed," Duncan says, including TV commercials, print ads, online executions and public relations efforts.
"It really was thinking about the [Gain] campaign in a macro sense, but thinking Store Back for the first executions around those 'crack the cap' insights that really drove consumer appeal for the brand," he says.
Although it launched before Store Back was officially announced, the CoverGirl LashBlast campaign featuring Drew Barrymore was conceived with the same core principles in mind. G2 was the digital and First Moment of Truth agency for this campaign, which had a large presence in-store.
"The execution at the retail level involved utilizing a big orange [mascara] tube, which was very visible in-store, very dramatic, and helped to attract the shopper's attention," says Dodd. "We featured in-store Drew Barrymore, which connected to the advertising, so there was a connection to the shopper and to the store from what they would have seen on TV."
The in-store pieces were tailored to fit the needs of CoverGirl's key retail customers based on an understanding of their shopper profiles and P-O-P guidelines. These marginally different executions remained consistent with the campaign's big idea of bold, beautiful lashes, resulting in a favorable share performance for the brand, Dodd says.
Beyond P&G
While the term "Store Back" belongs to Procter & Gamble, those interviewed agree the thinking behind it can apply to virtually any product category that is sold at retail. "Procter's done a great job of distilling it and aligning their organization [around Store Back], and others are doing it to similar or maybe slightly lesser degrees at the moment," Dodd says of G2's other clients.
Meanwhile, Mooney is consulting brand marketers and agencies on what she calls StoreFirst, defined as "creating marketing ideas first with the store in mind for better in-store impact and improved integrated 360-degree marketing." She agrees that this idea, which must go beyond a mindset to entail changes in process and ultimately become an operational discipline, applies to virtually any product "where in-store is really important in making their purchase decision."
Another important consideration is assessing and qualifying the in-store idea early in the process. "Don't just sit in the conference room and say, 'Yeah, I think that's pretty good.' Qualify it and test it with shoppers," Mooney says.
She stresses, though, that StoreFirst is not a formula. "It's not something that will look the same way at every company because it depends on the company's processes, their organization structure, etc. It's not one size fits all."
"It's especially important for categories that are confusing, that have a lot of SKUs, that have sort of high launch rates, where there's a lack of differentiation and there's a high risk of shopper decision failure," she adds.
Mooney also tells clients to take into account their key retailers' planning processes and calendars when they're thinking about launching new products, which Dodd agrees is one of the benefits of this mentality. "You're taking the idea more directly into the store, which arguably is going to be more powerfully communicated and more effective," he says. "You also think about the constraints of the store at the appropriate time in the process, so you can use them advantageously rather than be compromised by some of those constraints."
Although a Store Back or StoreFirst framework may look different depending on the company, Mooney asserts that this type of thinking "is just the next evolution for companies to say, 'Not only should you have expertise and know-how and processes relative to shopper marketing, but additionally you should think about the store more seminally -- more first -- and how your product comes to life in-store,' because the store really is the torture test. If it doesn't work in-store, it doesn't work."
http://www.shoppermarketingmag.com/articles/?nid=57444
Wednesday, March 10, 2010
What Kind of Brand Associates With Chatroulette?
French Connection Offers Shopping Spree to Winner Who Hooks Up Using the Webcam Chat Room
Posted by Emma Hall on 03.10.10 @ 05:17 PM
LONDON (AdAge.com) -- What kind of brand would want to associate with Chatroulette? Well, French Connection -- of FCUK fame -- would, and the U.K.-based clothing retailer is using the random, anonymous chat room for a marketing push. No stranger to racy, risk-taking -- and some would say outright offensive -- marketing, French Connection is embracing a site that connects people to random strangers through webcam chats.
In the promotion, the first person to prove they have used Chatroulette to set up a date wins $375 of vouchers to spend at a French Connection store on a "real life date-worthy outfit." The prize may be small, but the risks are huge, considering that much of what happens on Chatroulette, set up in November 2009, is pornography at best.
In January 2010, Chatroulette had a million visitors, according to ComScore, and February figures are expected to show those numbers have quadrupled. When a person tires of a conversation, they can press "next" to move on. It is impossible to spend more than a few minutes on the site without coming up against male genitalia, but it can also be a fascinating journey into the lives of strangers around the world, and celebrities such as Ashton Kutcher and the Jonas Brothers have been known to turn up on it unexpectedly.
William Woodhams, director of marketing at French Connection, isn't too concerned about the possible pitfalls of sending people to hook up with strangers online. He said, "We've hijacked the site; we're a fashion brand and we wanted to get involved in an irreverent way. It's a fun medium, although it's also weird, sad and strange. We only put up a small prize, because we don't want to look like we're trying too hard."
The tease, and the rules, are posted on the brand's website, with this Chatroulette challenge: "Can you prove yourself by venturing into the most terrifying terrain on the internet to seduce a woman." The contest opened Feb. 26, and entries are being accepted on the French Connection site until March 12, with proof of the scheduled hook-up required in the form of pasting comments or a screen grab from the Chatroulette site. French Connection didn't get or seek permission from Chatroulette for the contest.
No stranger to controversy
French Connection has never feared controversy. Its "FCUK" campaign, first seen 13 years ago, offended many Brits over a number of years. Its current campaign, introducing "The Man" and "The Woman," has unsettled some consumers by choosing a relatively mature, unkempt, bearded man as its star.
In fact, the Chatroulette campaign has already attracted complaints, initially from people who objected to the fact that it was about men picking up women. French Connection reacted by opening up the competition, originally limited to men scoring a date with a woman, to women too.
Mr. Woodham said, "There is flexibility in our brand. The appeal of Chatroulette is that it's new and a bit dangerous. We're a fashion brand trying to talk to men, and there's not a lot of cool stuff on the internet in a fashion sense. I didn't want to just set up a computer game."
While the promotion could backfire horribly, French Connection could have something to teach other marketers about giving up their fear of social networking, and embracing the risks and rewards it offers.
Stuart Parkinson, a planner at London agency VCCP, part of Chime Communications, said, "People are a lot more comfortable online than brands are. [The Chatroulette tie-up] sets up French Connection as closer to the consumer than anyone else."
Mr. Parkinson said he believes brands that don't take risks are reducing their audience to the lowest common denominator. He said, "French Connection understands that people don't mind, and demonstrates a trust in its audience -- a faith in the consumer -- that makes a better brand statement than any ad. They've done something risky and edgy, not just talked about doing something risky and edgy in a TV spot."
Other brands unlikely to follow
But few marketers are likely to emulate French Connection. Matt Simpson, head of digital at OMD Group U.K., said, "French Connection has continually danced along the line of what's acceptable, and they seem to be operating on the 'No PR is bad PR' rule. Possibly a large part of the target market will love it, but it's likely to be outweighed by negative media coverage."
Mr. Simpson said he would not be recommending Chatroulette to clients. "It's a completely uncontrollable environment that plays to the absolute worst the web has to offer," he said. "This is a breeding ground for everything that could happen that is bad."
That doesn't mean that the success of Chatroulette should go unheeded. It proves both that consumers enjoy a little randomness, and that they are willing to embrace the webcam chat. However, while every marketer has a curiosity about social sites, most, Mr. Simpson said, are still asking, "How do we manufacture a low-risk situation?"
French Connection claims to have had "thousands" of entries, and the competition has attracted international media attention from the likes of Perez Hilton.
http://adage.com/globalnews/article?article_id=142741
Posted by Emma Hall on 03.10.10 @ 05:17 PM
LONDON (AdAge.com) -- What kind of brand would want to associate with Chatroulette? Well, French Connection -- of FCUK fame -- would, and the U.K.-based clothing retailer is using the random, anonymous chat room for a marketing push. No stranger to racy, risk-taking -- and some would say outright offensive -- marketing, French Connection is embracing a site that connects people to random strangers through webcam chats.
In the promotion, the first person to prove they have used Chatroulette to set up a date wins $375 of vouchers to spend at a French Connection store on a "real life date-worthy outfit." The prize may be small, but the risks are huge, considering that much of what happens on Chatroulette, set up in November 2009, is pornography at best.
In January 2010, Chatroulette had a million visitors, according to ComScore, and February figures are expected to show those numbers have quadrupled. When a person tires of a conversation, they can press "next" to move on. It is impossible to spend more than a few minutes on the site without coming up against male genitalia, but it can also be a fascinating journey into the lives of strangers around the world, and celebrities such as Ashton Kutcher and the Jonas Brothers have been known to turn up on it unexpectedly.
William Woodhams, director of marketing at French Connection, isn't too concerned about the possible pitfalls of sending people to hook up with strangers online. He said, "We've hijacked the site; we're a fashion brand and we wanted to get involved in an irreverent way. It's a fun medium, although it's also weird, sad and strange. We only put up a small prize, because we don't want to look like we're trying too hard."
The tease, and the rules, are posted on the brand's website, with this Chatroulette challenge: "Can you prove yourself by venturing into the most terrifying terrain on the internet to seduce a woman." The contest opened Feb. 26, and entries are being accepted on the French Connection site until March 12, with proof of the scheduled hook-up required in the form of pasting comments or a screen grab from the Chatroulette site. French Connection didn't get or seek permission from Chatroulette for the contest.
No stranger to controversy
French Connection has never feared controversy. Its "FCUK" campaign, first seen 13 years ago, offended many Brits over a number of years. Its current campaign, introducing "The Man" and "The Woman," has unsettled some consumers by choosing a relatively mature, unkempt, bearded man as its star.
In fact, the Chatroulette campaign has already attracted complaints, initially from people who objected to the fact that it was about men picking up women. French Connection reacted by opening up the competition, originally limited to men scoring a date with a woman, to women too.
Mr. Woodham said, "There is flexibility in our brand. The appeal of Chatroulette is that it's new and a bit dangerous. We're a fashion brand trying to talk to men, and there's not a lot of cool stuff on the internet in a fashion sense. I didn't want to just set up a computer game."
While the promotion could backfire horribly, French Connection could have something to teach other marketers about giving up their fear of social networking, and embracing the risks and rewards it offers.
Stuart Parkinson, a planner at London agency VCCP, part of Chime Communications, said, "People are a lot more comfortable online than brands are. [The Chatroulette tie-up] sets up French Connection as closer to the consumer than anyone else."
Mr. Parkinson said he believes brands that don't take risks are reducing their audience to the lowest common denominator. He said, "French Connection understands that people don't mind, and demonstrates a trust in its audience -- a faith in the consumer -- that makes a better brand statement than any ad. They've done something risky and edgy, not just talked about doing something risky and edgy in a TV spot."
Other brands unlikely to follow
But few marketers are likely to emulate French Connection. Matt Simpson, head of digital at OMD Group U.K., said, "French Connection has continually danced along the line of what's acceptable, and they seem to be operating on the 'No PR is bad PR' rule. Possibly a large part of the target market will love it, but it's likely to be outweighed by negative media coverage."
Mr. Simpson said he would not be recommending Chatroulette to clients. "It's a completely uncontrollable environment that plays to the absolute worst the web has to offer," he said. "This is a breeding ground for everything that could happen that is bad."
That doesn't mean that the success of Chatroulette should go unheeded. It proves both that consumers enjoy a little randomness, and that they are willing to embrace the webcam chat. However, while every marketer has a curiosity about social sites, most, Mr. Simpson said, are still asking, "How do we manufacture a low-risk situation?"
French Connection claims to have had "thousands" of entries, and the competition has attracted international media attention from the likes of Perez Hilton.
http://adage.com/globalnews/article?article_id=142741
Tuesday, March 9, 2010
Male Call: Marketers Jump on Men's Grooming Trend
Personal Care Is in, but Term 'Metrosexual' Is Definitely out
By Jack Neff
Published: March 08, 2010
BATAVIA (AdAge.com) -- It's a beautiful time to be a man -- or at least to market to men -- as personal-care marketers rev up for what looks to be the biggest array of product launches for men in nearly a decade and maybe ever.
"MANTHEM: Unilever has made men the focus of its biggest 2010 launch for its biggest personal-care brand, Dove."
Procter & Gamble Co. recently has reorganized its beauty-marketing ranks largely to help capture the growing potential of the men's market, and recently got San Antonio-based supermarket chain H-E-B to try a men's personal care section. Unilever has made men the focus of its biggest 2010 launch for its biggest personal-care brand, Dove. Unilever sees a $700 million opportunity to grow the men's personal-care market in categories where it competes -- essentially personal wash, hair care and deodorants -- a market currently measured by Nielsen at $2.1 billion that the marketer expects will hit $2.8 billion by 2012.
Then there's P&G's Gillette and Energizer Holdings' Schick, going head to head with near-simultaneous launches of razor systems or major upgrades, expected to spend a combined quarter of a billion dollars marketing those launches alone.
Boon for male-centric media
The male call by marketers has also been a boon for media that cater to the demographic, like ESPN. "It's definitely a growth area for us," said Ed Erhardt, president of ESPN and ABC Sports, which is positioned to reap much of the uptick in competitive spending.
It all hearkens to the heady days of 2002, when personal-care marketers of all sorts were fixated on men as their new frontier, even coining the concept of the "metrosexual" grooming and fashion-obsessed male. The enthusiasm faded into what seemed like vague disappointment, as brands such as L'Oreal, Nivea, Neutrogena and Gillette tried launching skin and in some cases hair-care lines for men that had trouble keeping their space on U.S. shelves.
It's been at least six years since any marketer could be caught uttering the M word. Marketers who had heralded the arrival of the "metrosexual" last decade found the term tended to pigeonhole their products with a relatively narrow segment of upscale, fashion-conscious men. The reality is that the segment exists and has kept growing, but marketers seeking to sell such products as shampoo and bodywash to men are appealing to a much broader audience, too.
Men's toiletries had less than 1% annual growth in 2008 and 2009, according to a report by Mintel late last year. But that's robust compared to the personal-care market as a whole. Personal-care sales for women and men sank 5.1% last year in grocery, drug and mass outlets including Walmart, according to Information Resources Inc.
It's growth that marketers are chasing fervently, and somewhat heatedly.
Dirty ad fight
P&G has been highlighting the masculinity of its men's brands, Old Spice and Gillette, amid the high-profile entry of Dove Men+Care. Recent ads from Wieden & Kennedy, Portland, Ore., urge women to get their men to stop using "lady-scented body wash" in favor of Old Spice. An ad for Gillette's body wash, with a fairly obvious proxy for the new Dove product in the shower, pointedly says, "Just because it says it's for men doesn't mean it is."
"We think frankly a brand grounded in men, where you don't have to say it's for men, has a much better chance of winning in the marketplace," said Ed Shirley, vice chairman of beauty and grooming for P&G.
For its part, Unilever claims it has the leading men's personal-care brand in categories outside shaving: Axe. (Gillette is the leading personal-care brand overall -- including shaving -- for men.) And Unilever has captured two-thirds of the growth in men's grooming over the past five years, said Kathy O'Brien, VP-personal care North America. Gillette, despite its commanding 70%-plus market share in razors and blades, hasn't been able to easily translate that success into leadership in any other men's category.
But will the Dove brand, traditionally associated with the fairer sex, really resonate with men? "Many men are already using Dove products, and Unilever has a history of proven success in men's care," said Ms. O'Brien.
But it's a long battle. Mr. Shirley has been an advocate for men's skin care since the late 1990s, when he could see how much more developed men's skin care was outside the U.S. "North American guys are less involved [in skin care], but it's up to us to help them."
What they should be doing -- in the long-term marketing scheme of things -- is washing their faces and using moisturizer before bed. "We know that if you had a full regimen of morning and evening care, your shaving experience would be better," Mr. Shirley said. "And we have that right to have that conversation with guys, because the shaving experience is the anchor grooming event."
Not that Gillette is going to bring up that moisturizer-before-bed subject just yet. But it's moving the discussion in that direction in part through the line of shave-preparation products coming to market in June with its Gillette Fusion ProGlide razor system, which includes a heating face scrub and moisturizing aftershave with sunscreen protection.
"We're committed to winning with men," said Mr. Shirley.
Can Dove make its brand manly enough for guys?
Since its beginnings in the 1950s in the U.S., Dove has been marketed only to women, and Unilever's "Campaign for Real Beauty," all about perceptions of female beauty, reinforced that. Now, Dove is looking to develop a male alter ego as it seeks to conquer new territory, provoking disbelief by some and a bit of taunting from rival Procter & Gamble Co.
Yet marketing actually has a long history of gender-bending brands that have added, changed or developed gender identities long after they were well-established, sometimes with wildly successful results. Among those who've made the change:
Marlboro: Hard as it may be to believe now, Marlboro started in the 1920s as a filtered cigarette for women. When research linking smoking to lung cancer emerged in the 1950s, Philip Morris decided it needed a "safer" filtered cigarette for men, who were reluctant to smoke a women's brand. So it enlisted Leo Burnett to change Marlboro's gender. The rest is history.
Degree: As personal care began pairing off increasingly into male and female brands and products in 2002, Degree tried having it both ways, developing lines for men and women. It's been wildly successful. Degree has been the fastest-growing antiperspirant in the U.S. in recent years. Since 2004, it's nearly doubled sales to $148 million and added 4.3 share points to attain an 11.9% market share, according to Information Resources Inc.
Ugg: It actually started as a men's brand years ago before becoming much better known as a girl's and women's brand. Now, Ugg is seeking growth by appealing to men again. So Deckers Outdoor has increased Ugg's men's offerings 20% in the past year and ramped up ads in men's fashion magazines and online to appeal to guys.
Nair for Men: The Church & Dwight Co. brand introduced a version for men in 2002, appealing to a trend toward some men shaving their chests, backs and just about everywhere else hair may appear.
--Jack Neff
By Jack Neff
Published: March 08, 2010
BATAVIA (AdAge.com) -- It's a beautiful time to be a man -- or at least to market to men -- as personal-care marketers rev up for what looks to be the biggest array of product launches for men in nearly a decade and maybe ever.
"MANTHEM: Unilever has made men the focus of its biggest 2010 launch for its biggest personal-care brand, Dove."
Procter & Gamble Co. recently has reorganized its beauty-marketing ranks largely to help capture the growing potential of the men's market, and recently got San Antonio-based supermarket chain H-E-B to try a men's personal care section. Unilever has made men the focus of its biggest 2010 launch for its biggest personal-care brand, Dove. Unilever sees a $700 million opportunity to grow the men's personal-care market in categories where it competes -- essentially personal wash, hair care and deodorants -- a market currently measured by Nielsen at $2.1 billion that the marketer expects will hit $2.8 billion by 2012.
Then there's P&G's Gillette and Energizer Holdings' Schick, going head to head with near-simultaneous launches of razor systems or major upgrades, expected to spend a combined quarter of a billion dollars marketing those launches alone.
Boon for male-centric media
The male call by marketers has also been a boon for media that cater to the demographic, like ESPN. "It's definitely a growth area for us," said Ed Erhardt, president of ESPN and ABC Sports, which is positioned to reap much of the uptick in competitive spending.
It all hearkens to the heady days of 2002, when personal-care marketers of all sorts were fixated on men as their new frontier, even coining the concept of the "metrosexual" grooming and fashion-obsessed male. The enthusiasm faded into what seemed like vague disappointment, as brands such as L'Oreal, Nivea, Neutrogena and Gillette tried launching skin and in some cases hair-care lines for men that had trouble keeping their space on U.S. shelves.
It's been at least six years since any marketer could be caught uttering the M word. Marketers who had heralded the arrival of the "metrosexual" last decade found the term tended to pigeonhole their products with a relatively narrow segment of upscale, fashion-conscious men. The reality is that the segment exists and has kept growing, but marketers seeking to sell such products as shampoo and bodywash to men are appealing to a much broader audience, too.
Men's toiletries had less than 1% annual growth in 2008 and 2009, according to a report by Mintel late last year. But that's robust compared to the personal-care market as a whole. Personal-care sales for women and men sank 5.1% last year in grocery, drug and mass outlets including Walmart, according to Information Resources Inc.
It's growth that marketers are chasing fervently, and somewhat heatedly.
Dirty ad fight
P&G has been highlighting the masculinity of its men's brands, Old Spice and Gillette, amid the high-profile entry of Dove Men+Care. Recent ads from Wieden & Kennedy, Portland, Ore., urge women to get their men to stop using "lady-scented body wash" in favor of Old Spice. An ad for Gillette's body wash, with a fairly obvious proxy for the new Dove product in the shower, pointedly says, "Just because it says it's for men doesn't mean it is."
"We think frankly a brand grounded in men, where you don't have to say it's for men, has a much better chance of winning in the marketplace," said Ed Shirley, vice chairman of beauty and grooming for P&G.
For its part, Unilever claims it has the leading men's personal-care brand in categories outside shaving: Axe. (Gillette is the leading personal-care brand overall -- including shaving -- for men.) And Unilever has captured two-thirds of the growth in men's grooming over the past five years, said Kathy O'Brien, VP-personal care North America. Gillette, despite its commanding 70%-plus market share in razors and blades, hasn't been able to easily translate that success into leadership in any other men's category.
But will the Dove brand, traditionally associated with the fairer sex, really resonate with men? "Many men are already using Dove products, and Unilever has a history of proven success in men's care," said Ms. O'Brien.
But it's a long battle. Mr. Shirley has been an advocate for men's skin care since the late 1990s, when he could see how much more developed men's skin care was outside the U.S. "North American guys are less involved [in skin care], but it's up to us to help them."
What they should be doing -- in the long-term marketing scheme of things -- is washing their faces and using moisturizer before bed. "We know that if you had a full regimen of morning and evening care, your shaving experience would be better," Mr. Shirley said. "And we have that right to have that conversation with guys, because the shaving experience is the anchor grooming event."
Not that Gillette is going to bring up that moisturizer-before-bed subject just yet. But it's moving the discussion in that direction in part through the line of shave-preparation products coming to market in June with its Gillette Fusion ProGlide razor system, which includes a heating face scrub and moisturizing aftershave with sunscreen protection.
"We're committed to winning with men," said Mr. Shirley.
Can Dove make its brand manly enough for guys?
Since its beginnings in the 1950s in the U.S., Dove has been marketed only to women, and Unilever's "Campaign for Real Beauty," all about perceptions of female beauty, reinforced that. Now, Dove is looking to develop a male alter ego as it seeks to conquer new territory, provoking disbelief by some and a bit of taunting from rival Procter & Gamble Co.
Yet marketing actually has a long history of gender-bending brands that have added, changed or developed gender identities long after they were well-established, sometimes with wildly successful results. Among those who've made the change:
Marlboro: Hard as it may be to believe now, Marlboro started in the 1920s as a filtered cigarette for women. When research linking smoking to lung cancer emerged in the 1950s, Philip Morris decided it needed a "safer" filtered cigarette for men, who were reluctant to smoke a women's brand. So it enlisted Leo Burnett to change Marlboro's gender. The rest is history.
Degree: As personal care began pairing off increasingly into male and female brands and products in 2002, Degree tried having it both ways, developing lines for men and women. It's been wildly successful. Degree has been the fastest-growing antiperspirant in the U.S. in recent years. Since 2004, it's nearly doubled sales to $148 million and added 4.3 share points to attain an 11.9% market share, according to Information Resources Inc.
Ugg: It actually started as a men's brand years ago before becoming much better known as a girl's and women's brand. Now, Ugg is seeking growth by appealing to men again. So Deckers Outdoor has increased Ugg's men's offerings 20% in the past year and ramped up ads in men's fashion magazines and online to appeal to guys.
Nair for Men: The Church & Dwight Co. brand introduced a version for men in 2002, appealing to a trend toward some men shaving their chests, backs and just about everywhere else hair may appear.
--Jack Neff
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