Archive for the 'Brand Value' Category

PepsiCo: Think Fast to Keep Up with the Digital Consumer

February 19, 2013

Shiv Singh PepsiCo Beverages’ global head of digital Shiv Singh has spent a good part of the last few years advising small businesses, start-ups and blue chip brand managers alike on how online and mobile innovations are impacting traditional marketing strategies. Along with penning the book Social Media Marketing For Dummies in 2012, the digital marketing guru has presented on the topic at high-profile venues from ad:tech in New Delhi to Austin’s SXSW, outlining what steps are needed to stay relevant and engaging in the increasingly social, fast-paced consumer environment.

To market effectively, Singh underlines the importance of real-time insights, saying, “It’s the only way to truly stay culturally relevant with consumers.” This is clearly a challenge given that marketing activities within large companies have traditionally required 9 to 12 months’ lead time before a campaign, or even a statement, goes public. This fundamental shift in process is a giant step, but if done right, jumping that hurdle can propel brands into the next level of social media savvy. Oreo’s Super Bowl Tweet in response to the power outage this year – which was retweeted 10,000 times within one hour, according to Chicago Business – was a great example of how quick turnaround can have a big payoff.

Another more recent example comes straight out of Singh’s backyard. As Digiday reported, Pepsi was one of the first major brands to jump in on the newsfeed-clogging Harlem Shake craze that appeared online in late January. With more than 44 million views on 12,000+ meme-related videos uploaded by mid-February (according to the Mercury News), the cola brand released two commercials – one featuring Pepsi, another Pepsi Max – reflecting the importance it places on pop culture and real-time relevance to engage consumers.

See Mr. Singh speak about how PepsiCo is making its brands relevant for future generations at our BRITE ’13 Conference (March 4-5, NYC).

BY NANDITA RAY

Brand Value: Measuring All the Angles

June 13, 2012

Measuring Brand ValueAh, the L.A. Dodgers, a team whose recent woes under the leadership of Frank McCourt resulted in a purchase that rocked the baseball world. In 2011, Forbes estimated the Dodgers to be worth $800 million, more than the average value of a major league baseball team team. Thanks to a TV deal in March 2012, Forbes upped that number to $1.4 billion. One month later, news erupted that Guggenheim Baseball Management, a consortium lead by Magic Johnson, would acquire the team for a whopping $2.15 billon.

Many questioned the rationale behind this dollar amount, exclaiming the consortium vastly overpaid for a franchise with such a comparatively low net worth. David Carter, executive director of the USC Sports Business Institute, tells Fox Business, that it’s not solely about buying an organization at face value. “It’s purchasing a baseball team that is an anchor that allows you to make money off other revenue-rich opportunities.”

Chief executives that agree with this see the value of a brand. However, many CEOs, CFOs, and accounting teams still see marketing and communications as cost line items rather than buttresses that sustain brands and lend book value to companies.

Columbia Business School recently published two studies related to varying perspectives organization’s have about the value of marketing. The first, “Accounting for Marketing Activities,” found that part of the problem is internal communications. Experts feel that marketers don’t clearly articulate the impact of their expenditures on bottom lines to finance officers. The second, “Marketing ROI in the Era of Big Data,” adds that there’s a need to develop a better understanding of how marketing creates financial returns for companies. Attributing value to marketing is a common struggle.

Marketing’s role, in its most basic form, is to get the word out to the right people through a range of channels. But an integral part of this is communicating a brand’s core message and relevance to its audience, demonstrating value for consumers, which in turn adds value to a company. The foundation of a strong brand is built by delivering on a promise—providing quality and dependable products and/or services. But intangible items like brand persona, experience, and reputation are also largely influential when it comes to actual purchase and loyalty, generating sales and revenue. Much of this process can be attributed to the emotional connection formed between brand and consumer.

Developing meaningful relationships with a brand’s audience is a vital part of path-to-purchase, advocacy, financial growth and longevity. Humanizing brands leverages such relationships. In addition to products and services, they offer distinct images, feelings, experiences, thoughts and perceptions creating differentiated value in the mind of its audience. In fact, a brand is, in essence, an extension of one’s self. Consumers are more apt to buy products from a particular brand that reflects their personality and aligns with their interests and personal values, subsequently raising the net worth of a brand.

Apply this notion to the Dodgers. Another factor contributing to the high-priced offer is that they’re the… L.A. Dodgers, a well-known brand that officially acquired its name over 70 years ago. There’s history behind these “boys of summer,” a term that’s not only in a Don Henley song, but the title of a book based on this very team. More than ticket sales, sponsorship, and TV deals, the bid amount stemmed from relationships with devoted fans and the iconic value of the Dodgers brand in and of itself.

Coca-Cola Ad (1938)

Coca-Cola ad from 1938
Click to enlarge

Another prime example is Coca-Cola. In CNBC’s documentary, “Coca-Cola: The Real Story Behind the Real Thing,” Donald R. Keough, former president of Coca-Cola, discussed the implications of its 1985 debacle, the launch of the now-defunct “New Coke.” He received a tearful call from a stranger, an elderly woman. She was heartbroken by the reformulation of its trademark beverage. Interestingly enough, she hadn’t sipped the soda since the 1940s, and therefore not tasted this new iteration. However, the Coca-Cola brand held memories for her, ones that she strongly associated with her childhood. She told Keough that they were playing with her youth. When Coca-Cola decided to lay the original Coke to rest, it took a piece of her past with it.

A CFO may say this is a nice story, but she hadn’t been a consumer in years. Though she may not have spent a nickel on Coca-Cola in decades, the brand clearly resonated with her. And there were plenty of present-day consumers who also protested New Coke. Value to her and the millions of others was emotive. For those who did not like the taste, had the emotional connection not existed, they wouldn’t have expressed such outrage over the new formula. Instead, they simply would have ceased buying it. Keough noted to CNBC, “We did not understand the deep emotions of so many of our customers for Coca-Cola.”

BY ALLIE ABODEELY

CFOs…They’re Just Not That into You

April 10, 2012

It is often said that those in the finance department and those in the marketing department come from two different planets! Because of long standing accounting principles and practices, marketing is often relegated to being just a cost line item rather than a value-generating activity.

Natalie Mizik, former Associate Professor of Marketing at Columbia Business School, now at Kenan-Flagler Business School, and Doron Nissim, Professor of Accounting and Finance at Columbia Business School, took a closer look at the implications of current accounting models and their representation of marketing activities. In their article, Accounting for Marketing Activities: Implications for Marketing Research and Practice, Mizik and Nissim found that common accounting principles and practices have led to distortions of marketing contributions in financial reporting. In addition, some experts feel that marketers don’t adequately communicate how their expenditures benefit the bottom line. Together these factors affect perceptions of marketing’s value, which can impact everything from marketing budgets to influence and practice.

To mitigate the negative light financial reporting can cast on the perception of marketing, Mizik and Nissim recommend marketers play a more active role in the financial reporting debate. According to them, providing “consistent, observable, quantifiable and verifiable information” on marketing spend and its results, and sharing financially-based performance metrics can improve the process of evaluating marketing efforts and lessen the conflict between the finance and marketing worlds.

A recent study released by the Center on Global Brand Leadership and the New York American Marketing Association (NYAMA) confirmed the need for a robust set of ROI measures to improve  marketing’s standing within a company. The BRITE-NYAMA Marketing Measurement in Transition Study, Marketing ROI in the Era of Big Data, found that 70% percent of marketers say that their marketing efforts are under greater scrutiny than in the past. ROI metrics are critical to addressing the concerns about the contributions of marketing initiatives. However, more work is needed to develop a common understanding of ROI metrics even within marketing departments. The study revealed that although marketers see the value of ROI measures, there is confusion about the meaning and significance of ROI among marketers.

Marketers will need to continue to refine their understanding of ROI and develop consistent metrics, often specific to their own organization, in order to get CFO’s turned on to the results of marketing efforts.

BY KIM SHIFRIN

Why Bob Garfield Is Channeling Shakespeare

February 29, 2012

Not just a famous Shakespearian quote, “To thine own self be true,” according to Ad Age editor, Bob Garfield, is a maxim to which marketers should adhere.

Garfield, host of NPR’s On The Media and author of the forthcoming The Human Element, explains that in this new “Relationship Era,” it’s critical to “look inward” rather than mold your business to the public’s “often fickle, shortsighted tastes.

In a recent Ad Age article, Ignore the Human Element of Marketing at Your Own Peril, Garfield claims that marketers in the “Consumer Era” strove to get into the heads and hearts of consumers by asking them what they wanted, attempting to deliver it, and seducing the target audience to buy it through advertising. However, in today’s world, companies need to continually communicate their “essential self” or brand purpose via relationships with all stakeholders.

Garfield calls these relationships the “human element.” In this new era, customers (as well as vendors, stockholders, and employees) are not “conquests” but rather members of a community, looking to a company’s inner reason to decide if it merits adoration (or, potentially, hatred). The digital revolution has ushered in an age in which consumers are evaluating companies all the time across numerous conversations that go well beyond the latest advertising slogan. According to Garfield, these conversations “are about your brand’s essential self—which behooves you to think very hard about your essential self.”

See Bob Garfield speak about the Relationship Era and the Human Element at our BRITE ’12 Conference (March 5-6, NYC).

REGISTER NOW! 

BY KIM SHIFRIN

Pop Tarts’ Online Fan Base Comes to Life

September 8, 2010

Welcome back for fall. I hope all readers else got some time off to recharge, as I did.

As summer came to its inevitable close, I was interviewed by Reuters TV about the new Pop Tarts World Store that just opened near Times Square in New York. Customer flocked to the opening of this store for an immersive brand experience, complete with Pop Tarts store design and merchandise, a “Varietizer” to create customized boxes, and singular treats like Pop Tarts sushi (hold the wasabi, please).

With the retail sector still suffering through a sluggish economy, what would lead a company like Kellog’s to launch a flagship store for a brand like Pop Tarts?

Kellog’s actually got the idea for its store from its Facebook page, where a network of over two million customers have “liked” the brand, and wall updates generate dozens to hundreds of responses each.

Pop Tarts’ customers are creating their own online content too, including numerous amateur videos and songs dedicated to the sugary treat. In fact, both the brand’s Facebook page, and its YouTube channel (nearly 2 million views) focus almost exclusively on content created by their customer network – rather than recycling advertisements, pumping out corporate communications, or striving to manufacture a “viral” video by their marketing department.

While there has been much discussion of how brands and organizations can best cultivate “online communities,” the truth is that the most active and energizing communities (whether music fans, political supporters, or business partners) tend to be groups that interact with each other both online and in person.

So it behooves a brand like Pop Tarts, with such a large and passionate following online, to generate opportunities for them to meet and engage with the brand offline too – whether at special events, or retail spaces.

Even in a recession, marketers need to be willing to invest in their brands, especially those with loyal followers that make for a valuable long-term relationship.


Click here to watch the video on Reuters.com

BY DAVID ROGERS

This post originally posted by David on the DavidRogers.biz blog at: http://www.davidrogers.biz

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