Do they LOVE You?

Relationship marketing is what will get any company thru the tough times and the good times. That's why I really like this article:

The Ties That Bind

Of course we want customers to like our brand. But recent research suggests that an even more important driver of brand equity is brand attachment.

Brand attachment represents the emotional bond that consumers have between a brand and themselves. (Ahhhh! That's the cologne he wore on our wedding day!)

Consumers who are emotionally attached to a brand don't just like it, they love it. (Think Mickey and Minnie, Ben & Jerry, Harley-Davidson!) That is, they feel connected to it, regard it with a great deal of affection, and feel a great deal of brand passion.

This isn't just speculation: data based on a measure of brand attachment shows that it strongly predicts a consumer's loyalty. It does so even after taking into account the effects of strong brand attitudes, brand involvement, and customer satisfaction. None of these factors score as high as a true brand attachment.

The advice for marketers? Rather than asking whether your marketing activities induce brand liking, see if they enhance brand attachment. Does your brand offer a sentimental link to special occasions or activities? If so, consider that focus in your next promotion.

The Po!nt: Encourage attachments. Tying your brand to special life moments may enhance its long-term value.

Source: The Ties that Bind: Measuring the Strength of Consumers' Emotional Attachments to Brands. Matthew Thomson, Deborah MacInnis, and C. W. Park. Journal of Consumer Psychology, 2005.

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80 Million

That's the number of folks that are in the generation known as Millennials. Read more:

Companies Struggling to Attract, Serve Millennial Generation

Companies are struggling with how to adapt to serve a new wave of consumers from the Millennial Generation (or Gen Y) - born between 1982 and 2001 - according to a global survey by the Economist Intelligence Unit and Alcatel-Lucent company Genesys, reports Retailer Daily.

The survey asked C-level and other senior executives from around the world how they are creating a customer experience to attract and retain Millennials.

Three key findings emerged:

• Investment strategies are shifting to favor Millennials: Companies are debating heavily whether to invest more in catering to aging Baby Boomers versus next-generation consumers, with 42% saying they should tilt toward younger customers, while 39% would shift toward Baby Boomers and Generation X.

• The time to act is now: Most companies (54%) have not yet set their strategies or marketing for Millennials, even though they overwhelmingly agree that such steps are needed; 75% say Millennials will have an impact on their organization as consumers in the next three years.

• It’s an Enterprise 2.0 world: Most companies have a sophisticated understanding of what it would take to adapt, but they are not ready to change their customer engagement model by leveraging social networking, peer marketing, better online support, text messaging, and blogging.

The Millennials report (reg. req’d) highlights the need for businesses to invest in new modes of customer communication and to tailor their approaches to match customer preferences. More findings from the report follow.

Who are the Millennials and why do they matter?

Unlike the Baby Boomer generation, a group studied closely for decades, the Millennial generation, and its influence on consumer spending and corporate attitudes, is just beginning to be understood.

The Millennials include approximately 80 million individuals born between 1982 and 2001 in the US alone. The millennial generation outnumbers Baby Boomers today, and its ranks will continue to grow in influence as the majority of Millennials reach adulthood in the next decade, the report said.

How will companies balance between Millennials and older consumers?

Largely as a result of the Baby Boomers, executives overwhelmingly agree (81%) that each generation has specific work and marketplace needs, but they are split on which demographic group should receive the greater share of market investment.

A surprising 42% say a bigger share of investment in marketing and service should go toward catering to Millennials, while 39% favor older consumers. As a result of this split, the research found few companies have cemented their approach or yet implemented a strategy.

Have companies set their strategies to court them?

Fully 75% of companies say they will need to have a millennial strategy in place in the next three years, with 30% expecting a major impact that will lead to change across the organization, and 45% expecting a more modest impact.

However, 54% of respondents say they have yet not set their strategy for targeting, attracting, or retaining Millennials, while 32% say they have done so.

For example, most companies have not kept pace with the Millennials’ preference for interacting through newer, community-based technologies, as most firms continue to rely on telephone, email and store/office-front points of contact.

How will companies try to attract more Millennials?

The Economist Intelligence Unit found the proliferation of blogs, podcasts, videos, chat rooms, social networking sites and other online interactive communication has changed the corporate-customer relationship. In the past, customers tended to go directly to the company to enquire about a product, make a purchase or raise a complaint; today they increasingly go online. On the web, they learn, shop and share their experiences, both positive and negative.

The survey identified key features and motivating factors that companies expect to resonate with Millennials, which revolve around issues such as convenience, customization, and community.

• For example, when purchasing products and services, corporate reputation and brand are less important with the Millennials than peer recommendation and viral marketing (such as online promotional communications passed from one customer to another).
• Moreover, respondents say it is convenience, more than price, that drives millennial purchasing decisions. Others include “fast, reliable service,” “frictionless interaction,” a “tailored approach,” “honesty and trust” and a “personal touch.”

About the study: Of the 164 executives who took part in the survey, 29% came from North America, 31% from Europe, 30% from Asia-Pacific and 10% from the rest of the world. Participants represented 19 different industries. One-third of respondents’ organizations had annual revenue greater than $1 billion, and just over one-half (51%) had less than $500 million in revenue. Board members and CEOs comprised 30% of respondents. CFOs, CTOs and other C-level executives made up an additional 19%. The remainder was split among other senior and middle management functions.

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Some Magazines Are In Trouble

I recall the Readers Digest collection that used it sit on the back of the toilet in the family "reading room" when I was growing up.

My family used to subscribe to Life, US NEWS & WORLD REPORT, and a few others. Those days are gone as the internet has replaced some of those and other magazine publications.

From MarketingCharts.com:

Busy Moms Say Parenting Pubs Out of Touch, Want Info Here and Now

Mothers of school-age children want customized parenting information that will help them deal with the complex parenting issues they face each day, but 69% say today’s parenting magazines are not relevant to their children, according to research conducted by MomConnection for Parenting Magazine.

Two-thirds of mothers prefer to live “in the moment” with their children and only will engage with information that is relevant to them in the here and now, the study found.

Though all moms share some of the same underlying priorities, the majority want customized, practical information that is tailored to the issues they face in their daily lives at each life stage. They also expressed a need for more resources that tackle school-related topics.

Mothers also say that the amount of information in parenting magazines becomes less relevant to them as their children reach school age, and that connecting with other mothers facing the same issues is more important than connecting with mothers who have children of similar ages.

Additional findings:

• 63% of mothers with school-age children 6 and older prefer to be in the moment with their children, rather than worrying about what’s coming next.
• 65% want the information they need to handle their kids now and will read about next stages when they get there.
• 76% feel that parenting magazines have less information of interest to them once their children start school.
• 76% would rather connect with moms who are dealing with the same issues they are, regardless of their age or the age of their kids.
• 78% feel that ideas for filling leisure time with children are always welcome, but they need help with bigger everyday parenting issues.

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NO MORE COLD CALLS!!!

Lessons from the guy I learned from 20 years ago:

	Harvey Mackay's Column This Week Take the chill out of cold calls Cold calling is dead, or at least it should be. Too many sales people waste their time and energy cold calling for new business, when they can be using technology and the "Invisible Web" to warm up potential customers. Sam Richter, president of SBR Worldwide and senior vice president and chief marketing officer at Actifi, is a guru on taking the chill out of cold calling. His best-selling book Take the Cold Out of Cold Calling: Web Search Secrets for the Inside Info On Companies, Industries and People shows how being in the "Value Age" is even more central to salespeople than being in the "Information Age." That's why I wrote the foreward. My goal is always to learn as much as I can about my prospect and company. When you do that, you're going to have a warm call, where you position yourself and your company as credible. You capture the interest of your potential customer and ask pertinent questions because you already understand what's going on in their world. A cold call isn't just cold at the start. It leaves you cold at the finish. A value-based warm call defrosts the doorway. It turns practical research into an enticing opportunity. In his book, Sam shows how to use free or low cost tools to access information on companies, industries and people. Whether it's effectively using popular search engines or accessing data via the invisible web—the 90 percent of web pages that search engines don't access—the information that you need for warm calling is out there, if you know where and how to look. I know it works because MackayMitchell Envelope Company uses his system. He has made a couple presentations to our sales force. Start by visiting www.takethecold.com. Visit Sam's Warm Call Resource Center for an updated list of business information web sites, search tips, and download the Warm Call Toolbar so you can access business information resources directly from your browser. (I bite my tongue as I share this choice secret. I can only hope our competitors don't pick up Sam's book). Following are just a few of the search tips you'll find in Take the Cold Out of Cold Calling. Start using these today to get the information you need to establish your credibility, make a great first impression, provide relevant solutions and take the chill out of any cold call: Google Filetype Search: Imagine finding a competitor's sales proposal, an association's membership list, or a high-end research report online. To find files online using Google: Enter the information you want and/or the company name (use quotations around phrases). Enter filetype: and then choose a filetype extension (pdf = adobe acrobat; xls = Excel spreadsheets; ppt = PowerPoint document; doc = Word document). For example, "plastics industry" + "membership list" filetype:xls will search for a plastics industry membership list in Excel format. "ACME Corporation" filetype:ppt will search for an ACME Corporation PowerPoint presentation. "automotive industry" + trends OR issues filetype:pdf will locate reports and/or articles related to trends or issues in the automotive industry. LinkedIn.com: This business networking site helps you create connections at companies, learn about people, and ask for referrals. Once you're registered, invite people into your network. Your online network can grow quickly because as people accept your invitations, and as you accept theirs, everyone's network is shared. Once you've built up a good sized network, you can use LinkedIn's advanced search to start searching for people by name, company, job title and more. ZoomInfo.com: ZoomInfo uses sophisticated Web search tools to find information on people, and then it automatically creates an online profile using different information sources. Just enter a person's name in the ZoomInfo search engine. If it's a common name, also add their company name. Your Local Library: Most libraries subscribe to premium databases that you can use for free. Want Dun and Bradstreet or ReferenceUSA to research companies, their competitors, executive biographies and more? Want to see if a prospect company you're visiting has ever been quoted in a local newspaper or cited as an expert in an industry trade journal? Find out which library databases you can access from your computer. With the amount of information available online today, there is absolutely no excuse for not knowing something about your potential customer before you meet or call. Your prospect couldn't care less about you. What they do care about is if you can help them achieve their goals. Mackay's Moral: If information is power, then use the web to catch customers. Miss a column? The last three weeks of Harvey's columns are always archived online. More information and learning tools can be found online at harveymackay.com.

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Fresh Ideas

Okay, usually at this time on this website, I have a recap of Friday Night Marketing News from Mediapost.

Well, at the moment, I'm on a vacation with my wife and sometime Sunday you'll get the recap.

Instead, here are this weeks Fresh Ideas from Springwise.com:

It's time for your weekly fix of entrepreneurial ideas! Our latest issue is now online. Here's
a quick run-down of the promising new businesses featured on Springwise this week:

Healthy snacks, delivered by mail in serving sizes
Food & beverage

A new UK company sells natural and nutritious edibles that are
delivered by mail in just the right sizes, and according to a customer-
defined weekly schedule.

Matching buyers and sellers of cardboard boxes
Life hacks / Eco & sustainability

Anyone who's ever moved has experienced the Quest for Boxes,
involving either significant expense for new shipping boxes or
countless trips to stores and restaurants in search of usable discards.

Hotel helps guests connect online before they arrive
Tourism & travel / Media & publishing

Once they've booked, Pod Hotel's guests are sent a unique user ID
code that allows them to begin communicating with other guests on
the hotel's Pod Culture forum.

Best Buy launches store for and by women
Retail

Gone are the chain's typical warehouse-style blue interiors and metal
shelving, replaced instead by wood panelling, carpets featuring earth
tones and skylights for natural lighting.

Magazine republishes best from other style mags
Media & publishing

A new bimonthly magazine brings together the best content from
lesser-known fashion and style publications from around the world,
enhanced by commentary from renowned creative figures.

New venture makes recommendations across the web
Retail / Media & publishing

While a few stand-alone sites have popped up to connect 'twinsumers'
in specific niches (such as music), a Berlin-based startup aims to give
users recommendations for anything and everything across the web.

Discount seating on empty private jet flights
Travel & tourism

Geneva-based LunaJets takes advantage of the fact that many private
jets fly empty when they return home after dropping passengers off or
when they head out to pick passengers up.

More custom energy bars
Food & beverage

Earlier this year we covered customizable energy bars from Los
Angeles-based YouBar, and recently a similar contender out of the
Midwest crossed our proverbial path.

Eco-friendly pop-up spa
Lifestyle & leisure / Eco & sustainability

No sooner did we cover two mobile bars that popped up in Singapore
than one of our spotters alerted us to yet another pop-up innovation: a
mobile spa that launched at the Toronto International Film Festival.

Video dictionary with a wiki touch
Media & publishing / Education

Inspired by the way Wikipedia changed the encyclopedia with its
online format and user-contributed content, a new digital dictionary
hopes to change the way the world articulates the meanings of words.

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How Social Media Marketing Works

From the New York Times:

Spreading the Word (and the Lotion) in Small-Town Alaska

By STEPHANIE CLIFFORD

COMPANIES have been trying to create their own social networks ever since Friendster became popular. It was part fad and part marketer’s hope that customers were so devoted that they were dying to discuss shampoo or tires online.

With a campaign beginning this month, Vaseline is testing a more conceptual approach. Rather than creating an online social network, it is aiming to map the social network of a small town in Alaska.

The idea is to show that a new Vaseline lotion, Clinical Therapy, is so effective that the residents of Kodiak, Alaska, passed the word around.

It was partly of their own accord, and partly because Vaseline was pushing it: Vaseline representatives set up shop in a storefront in Kodiak and gave away free bottles. The residents had to pinpoint which of their fellow townspeople had recommended it.

Vaseline representatives began mapping who was suggesting the lotion to whom. It was not curiosity that drove them, but commercialism. They were trying to find a plugged-in Kodiak resident who had widely recommended the lotion, to be featured in commercials.

They found her in Petal Ruch, a voice coach and 40-year-old mother of four. She tried the lotion when she read the company was giving it away.

“I told them about a bunch of other people in our community that I thought could really use a good moisturizer since we all have dry skin and stuff,” Ms. Ruch said.

The campaign would focus on how Ms. Ruch “prescribed” the clinical-strength lotion to her town. (It is clinical strength in terms of the moisture levels, though it does not contain medication.)

“When the Vaseline campaign people told me that I was going to be their main person, I was totally astonished,” Ms. Ruch said.

Vaseline, owned by Unilever, wanted the campaign to have a real-world feel, as if Ms. Ruch had discovered and recommended the lotion on her own.

Working with the ad agency Bartle Bogle Hegarty and the production company @radical.media, Vaseline approached the project like a documentary. Story producers interviewed Kodiak residents who had tried the lotion, and two crews spent nine days filming in Kodiak.

The central question was “how can you use skin as a way into people’s lives?” said Justin Wilkes, the vice president for media and entertainment at @radical.media.

•

The filmmakers shot Ms. Ruch and her family as they went to karate class and ran through the forest. They interviewed her about how Clinical Therapy fit into her life — it softened her husband’s rough hands, for example — and that makes up much of the commercials.

Online, days’ worth of film has been edited into vignettes lasting several minutes. In those vignettes, Clinical Therapy is a background player, and the focus is on the residents of Kodiak and the town itself. There are shots of moody blue-gray skies and sea lions, and stories about residents like Wes Whipple, a blacksmith and knife maker. (Clinical Therapy sits on his shelf among his tools.) “We actually learned so much about their characters, as if we were genuinely making a film about them through their skin,” Mr. Wilkes said.

At prescribethenation.com, the marketing team will replicate the social map showing the links between Ms. Ruch and the various residents she “prescribed.”

“We found the whole concept of the interconnectedness of people really fascinating,” said John Foster, the creative director of Bartle Bogle Hegarty New York.

Alaska was chosen not for its now-famous governor, but for its harsh weather and small towns. “It’s a very small, hometown, close-knit community,” said Srini Sripada, marketing director for skin care and cleansers at Unilever. “So it allowed us to say, ‘Look, if we seed this among a community there, we’ll see how it propagates.’ ”

•

Vaseline is introducing another line this fall. It comes in streamlined midnight blue packaging, which means, naturally, that it is aimed at men.

Men are not so wild about lotion, Vaseline found. “They’re the least concerned, I would say, among our consumers for taking care of their skin,” Mr. Sripada said.

While some department store lines have introduced men’s lotions, they are not yet standard in drugstore brands. Nivea carries a men’s lotion, but its sales are tepid — roughly 15,000 bottles sold in the last year in the United States, according to Information Resources, a market research firm in Chicago. (Its Nivea Body hand and body lotion, by contrast, sold 5.7 million bottles.)

In its market research, Vaseline found that men were concerned about feeling greasy and appearing feminine when using lotion. The company decided to position lotion as almost a performance enhancer: “If my skin is strong, then I can perform and do things that I want to do in life,” Mr. Sripada said.

To make lotion even more manly, Vaseline is teaming with ESPN to introduce Vaseline Men. Sports adds an air of masculinity, Mr. Sripada said, “and it focuses on the performance and the endurance.”

The sports network produced television and print commercials featuring Michael Strahan, the former defensive end for the New York Giants, and Chase Utley, the Philadelphia Phillies’ second baseman, using the lotion.

Those will run largely in and on ESPN properties. The strongerskin.com Web site, which went live in late September, shows behind-the-scenes views from the commercial shoots, including the lotion routines of Mr. Utley and Mr. Strahan.

Bartle Bogle Hegarty produced a set of related ads emphasizing skin’s properties like strength and thickness. The print ads compare skin to materials like Gore-Tex and plastic.

Using sports to market to men can be an ineffective panacea, but Vaseline’s approach was effective here, said John January, executive creative director of Sullivan Higdon & Sink, an ad agency that specializes in advertising to men and did not work on the campaign.

“Vaseline’s doing a pretty good job of creating a need here,” Mr. January said. “It’s almost marketed as a tool rather than a primp.”

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Combine Online with In-Store Retail

I have bought several items this way. This combines the best of both worlds, the convenience of shopping from home, your office or coffee shop, and then picking it up, sometimes as soon as 20 minutes later.

Can you implement this business model in your business?

Buy Online. Pickup Instore

According to the e-tailing group's recent Cross-Channel Shopping Study, "buy online for pickup in-store is definitely becoming more a part of stores' culture," according to Lauren Freedman, President. "Customer adoption coupled with growth among key multi-channel merchants embraces cross-channel customer convenience."

A primary appeal is free shipping to the store which 96% now offer vs. 92% last year. Merchants that stock products centrally need more time to ship goods to the store. This impacts same day pickup, now available from just 54% of those surveyed vs. 73% last year.

Efficiencies within the store like the pickup location more frequently being at the customer service area, and more related in-store signage, are further evidence of the feature's integration within the brick and mortar environment.

The overall wait time is also improving for store pickup; down to an average of 2.58 minutes versus 3.21 minutes last year and 3.64 the year prior. Products were ready and waiting when the customer arrived at the store 94% of the time, up from 83% in 2007.

In-Store Pickup Experience (% of surveyed merchants)
	3Q 2008	3Q 2007
Pickup Location & Type
Designated pickup counter	37%	45%
General cashier	42	43
Customer service area	21	12
Designated counter*
Easy to find	79	78
Medium difficulty	17	13
Difficult to find	4	9
In-store signage for pickup	58	55
Overall wait time	2.58 min	3.21 min
Produce ready & waiting	94	83
Source: the e-Tailing Group, September 2008 (*subset % penetration)

Online there is good visibility and promotion of this feature. It is constant on the home page and gaining penetration on the product page (50% '08 vs. 27% '07) as well as in the shopping cart.

Along with the order confirmation and onsite thank-you standards, more merchants are including pickup instructions. The study received email notification that products were ready for pickup 71% of the time vs. 52% last year.

Freedman concludes, "... more merchants (should) step up their efforts and make the necessary investment to facilitate buy online/pickup in-store.... customers coming into stores will be critical for servicing and selling to today's multi-channel customer."

An example of recommended (by e-tailing) customer service practices relative to in-store pickup is included here:

The e-tailing group Checklist: In-store Stellar Customer Service

• Keep promoted products be in-stock
• Allow shoppers to designate who will be picking up the order
• Include signage to direct customers picking up online orders
• Staff pickup counters with associates that have been trained on ship-to-store
• Keep store pickup areas in order
• Limit multi-tasking while with the customer
• Get feedback about customers' pickup experience

For more information including a list of surveyed merchants or to order the report visit the e-tailing group's website here.

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Your Customers Want to talk with You

Via Social Media.

What's Social Media? Uh, just Google it. When my kids were born, Compact Discs had replaced vinyl records. These days many kids have never used a phone book, they Google it. Instead of making your customers work to find you, make it easy for them to find you, go where they already are.

Consumers Want to Interact With Companies on Social Media

According to the findings of the 2008 Cone Business in Social Media Study, almost 60% of Americans interact with companies on a social media Web site, and one in four interact more than once per week. The survey finds that 93% of Americans believe a company should have a presence in social media, while 85% believe a company should not only be present, but should also interact with its consumers via social media.

56% of American consumers feel both a stronger connection with, and better served by, companies when they can interact with them in a social media environment.

Mike Hollywood, director of new media for Cone, observes that "... social media... it isn't an intrusion into their lives, but rather a welcome channel for discussion."

When Americans were asked about specific types of interactions:

• 43% say that companies should use social networks to solve my problems
• 41% want companies to solicit feedback on their products and services
• 37% feel that companies should develop new ways for consumers to interact with their brand
• 33% of men and 17% of women interact frequently (one or more times per week) with companies via social media

"The ease and efficiency of online conversation is likely a draw for men who historically do not seek out the same level of interaction with companies as women," says Hollywood.

33% of younger, hard-to-reach consumers (ages 18-34), believe companies should actively market to them via social networks, and the same is true of the wealthiest households (household income of $75,000+). Two-thirds of the wealthiest households and the largest households (3 or more members) feel stronger connections to brands they interact with online.

And eMarketer reports that Generation Y (those born after 1979) online buyers are more immersed in online and mobile activities than any other generation, according to 2008 research from shopping comparison site PriceGrabber. Some 85% of Gen Y respondents said they participated in social networking, and 57% reported involvement with blogs.

Data from an August 2008 survey of Web merchants, sponsored by Internet Retailer, found that, of the 39.3% of retail respondents that use social networks, 32% have a page on Facebook, 27% on MySpace and 26% on YouTube.

Social Networking Sites on Which US Online Retailers Currently Maintain a Page
Site	% of Respondents
Facebook	32%
MySpace	27
YouTube	26
Flickr	5
Other	10
Source: Internet Retailer, September 2008

Hollywood concludes that "All of this is great news for marketers... men and younger consumers are traditionally the most challenging to reach... (and) they are saying... market to us and interact with us online... "

For more information about this study, please visit Cone Research here.

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Guerrilla Marketing Insight

From the Wall Street Journal:

How to Launch a Successful Guerrilla Marketing Campaign

Posted by Kelly Spors

Marketing doesn’t have to be — and often shouldn’t be — a big-budget expense. Often it’s the most creative, attention-grabbing marketing tactics that make the biggest splash.

As part of her WSJ Insight Exchange breakfast series (register for the next one in Austin, Texas on Nov. 13 here), Wendy Bounds spoke to people like venture capitalist and entrepreneur Guy Kawasaki and Anne Zehren of Common Sense Media about some effective guerrilla marketing campaigns and what made them so effective.

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Seperating yourself from the Bad Boys

In the 1970's Donny Osmund and his brothers sang, "One Bad Apple don't spoil the whole bunch girl...." However with the current economic news being hammered down our throats every day, even the good, health financial institutions are suffering by association. There are lessons to learn in this report from the Kellogg School of Management:

Brand Scandal Spillover

When will a brand scandal spill over and how should competitors respond?

Based on the Research of Michelle L. Roehm And Alice M. Tybout

Many of us remember the 1993 Jack-in-the-Box scandal involving tainted hamburger meat: An outbreak of E. coli food poisoning left more than 700 people ill and four dead (New York Times, 1993). In the wake of the scandal, sales at Jack-in-the-Box plummeted. Although this outcome is not surprising, it is less obvious how the scandal affected competitors such as McDonald’s and Burger King. Did these firms benefit from Jack-in-the-Box’s scandal as consumers looked elsewhere for their hamburgers or did the scandal raise concerns about the safety of hamburgers served by fast food chains and thereby depress sales for their brands as well? More generally, how can a competitor of a scandalized brand assess the likelihood that a scandal will spill over? What strategies can be used to reduce the likelihood of spillover or to respond to spillover when it does occur? These are the questions that Alice Tybout, Harold T. Martin Professor of Marketing at the Kellogg School, and Michelle Roehm (Wake Forest University; PhD from the Kellogg School’s Department of Marketing) sought to answer in their research.

Conditions Which Make Brand Spillover Likely

Drawing upon theories of how consumers organize information about brands and product categories and how they use this information when making judgments, Tybout and Roehm outline conditions under which a brand scandal is likely to spill over. They propose that a brand scandal is more likely to spill over to beliefs about the general product category when: (1) the brand is a typical rather than an atypical member of the product category and (2) the scandal pertains to an attribute that is strongly associated with the product category. Thus, a scandal involving hamburgers at Burger King should be more likely to spill over to beliefs about traditional fast food restaurants than a scandal involving either ice cream at Burger King or hamburgers at Dairy Queen. This is because Burger King is more typical of traditional fast food restaurants than Dairy Queen and hamburgers are more strongly associated with traditional fast food chains than ice cream.

Further, they predict that a brand scandal is more likely to spill over to a particular competitor is perceived to be highly similar on the attribute involved in the scandal. For example, a A scandalized brand may benefit from drawing attention to its similarities to competitors.scandal involving hamburgers but not a scandal involving ice cream might be expected to spill over from Burger King to Hardee’s because Hardee’s is perceived as similar to Burger King in terms of its hamburgers but not its ice cream offerings.

These brand scandal spillover effects are especially likely when contextual factors, such as advertising seen in close proximity to learning about the scandal, highlight attributes that are shared by members of the category. By contrast, if contextual information highlights attributes that are unique to brands in the category, the likelihood of a spillover effect may be mitigated.

Finally, Tybout and Roehm predict that the effectiveness of a competitor’s denial of the scandal behavior will depend upon whether or not spillover has occurred. When spillover has occurred, a formal denial should prompt people to correct their mistaken inference. However, if spillover has not occurred, a denial is expected to boomerang, creating the very scandal effect it was intended to correct. The experiments were conducted to test these predictions.

Scandal in the Fast Food Category

The first experiment focused on brands in the fast food category. The scandalized firm was either Burger King or Dairy Queen and the company was purported to have either misled customers about the nutritional content of its burgers or served tainted ice cream. The scandal was introduced by asking MBA students to read and evaluate a fictional newspaper article that described one of the four scandals (Burger King-hamburger, Burger King-ice cream, Dairy Queen-hamburger, Dairy Queen-ice cream). Measure were taken both before and after reading about the scandal to assess its affect on attitudes toward the traditional fast food category to which Burger King belongs, and attitudes toward the dessert fast food category to which Dairy Queen belongs. Measures of the effect on a competitor, Hardee’s, were also taken.

The findings reveal that the scandal spilled over and affected attitudes toward the category when the scandalized brand was typical of that category and it involved an attribute strongly associated with the category. Thus, the Burger King-hamburger scandal affected attitudes toward the traditional fast food category but not the dessert fast food category, whereas the Dairy Queen ice cream scandal affected attitudes toward the dessert fast food category but not the traditional fast food category. Neither the Burger King-ice cream scandal nor the Dairy Queen-hamburger scandal spilled over to category attitudes.

Spillover to the specific competitor, Hardee’s, was also found, but only when the scandal pertained to an attribute on which the brands were similar. Specifically, the Burger King-hamburger scandal and the Dairy Queen-ice cream scandal spilled over to Hardee’s but the Burger King-ice cream scandal and the Dairy Queen-hamburger scandal did not. These findings are consistent with Tybout and Roehm’s theorizing regarding the role played by brand typicality and the scandal attribute in creating spillover.

Prevention and Response

A second experiment explored strategies for preventing spillover and responding to spillover when it occurs. This study focused on a single scandal, the fictitious Burger King-hamburger scandal described earlier, and its spillover to a new competitor, Wendy’s. Wendy’s belongs to the same traditional fast food restaurant category as Burger King and the two chains are viewed as similar in their hamburger offerings, making it likely that spillover would occur in the absence of a strategy for preventing it. An advertisement for McDonald’s shown prior to introducing the scandal was used to either encourage or reduce the likelihood that spillover would occur. When the ad highlighted attributes that McDonald’s has in common with other fast food chains, this priming of similarities was expected to promote spillover. However, when the ad highlighted attributes unique to McDonald’s, this focus on how brands differ was expected to reduce the likelihood that spillover would occur.

After reading the newspaper article that introduced the Burger King scandal, participants read a second article describing a new menu offering at Wendy’s that either included or did not include a denial that Wendy’s had ever or would ever engage in the scandal behavior (i.e., mislead customers about the nutritional content of its hamburgers). Inclusion of the denial was expected to be beneficial when spillover had occurred because it would motivate consumers to distinguish between Burger King and Wendy’s behavior. By contrast, inclusion of the denial was expected to be harmful when no spillover had occurred because it would cause consumers to wonder why Wendy’s “doth protest too much.”

The results supported the predictions. When the McDonald’s ad encouraged spillover by emphasizing similarities between fast food chains, attitudes toward Wendy’s were more favorable if the company denied the scandal behavior rather than remaining silent. However, when the McDonald’s ad reduced the likelihood of spillover by emphasizing unique attributes of the chain, attitudes toward Wendy’s were more favorable in the absence versus the presence of a denial. In this case, Wendy’s drew unwanted and unnecessary attention to the possibility it engaged in the scandal behavior, resulting in something the researchers dub a “boomerang effect.”

The final experiment examined a different product category, athletic shoes, and a different type of scandal, one related to corporate actions rather than to attributes of products. The fictitious scandal stated that Nike caused significant water pollution as a byproduct of its manufacturing processes. The effect of this scandal on attitudes toward two competitors, Reebok and Asics, who either issued or did not issue a denial, was assessed. The Nike scandal was expected to spill over to Reebok because Nike and Reebok are perceived as highly similar. As a result, attitudes toward Reebok should be more favorable when it issued a denial than when it did not. However, the scandal was not expected to spill over to Asics because Asics is not viewed as highly similar to Nike. Therefore, attitudes toward Asics should be more favorable when no denial is offered, compared to when the scandal behavior is denied. The results of the experiment supported these predictions, thereby generalizing the findings in the first two experiments.

An intriguing and unanticipated result also emerged. When spillover occurred, the pollution scandal was less detrimental to Nike itself. Apparently, if consumers infer the scandal might be a common practice within the industry, they are less likely to think ill of the scandalized company. The scandalized company “rebounds” while its unwitting competitors suffer.

Roehm and Tybout’s findings show that a scandalized brand may benefit from drawing attention to its similarities to competitors. Conversely, a competitor that is perceived as similar to the scandalized brand would do well to differentiate itself as much as possible from the scandalized brand—issuing a post-scandal denial only if it has already failed to differentiate itself.

Editor’s Note: Tybout and Roehm’s experiments involved fictional scandals about real brands. Immediately following each experiment, all research participants were fully debriefed to insure that they understood that the scandals were not true. Attitudinal measures taken following the debriefing revealed that the debriefing was successful in returning participants’ attitudes toward the companies to their pre-experimental levels.

Further reading:

Roehm, Michelle and Alice M. Tybout (2008). “Managing the Unthinkable: What to Do When a Scandal Hits Your Brand,” in Bobby J. Calder, editor, Kellogg on Advertising and Media. Hoboken, NJ: Wiley, pp. 159-177.

New York Times (1993). ”Jack in the Box’s Worst Nightmare,” February 6 (Accessed: December 6, 2007).

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Speak THEIR Language

From Jill Konrath:

Are You Making Your Prospects Feel Stupid?

Posted: 08 Oct 2008 03:53 PM CDT

Of course, you don't mean to do that! But the truth is that it often happens without you even thinking out it.

Case in point: You've just learned all about your new product or service offering. Tons of details. All its selling points. You're so excited & can't wait to share what you've learned with your prospects.

And when you finally get into a meeting, what comes out?

"We've just introduced a new complete system (methodology/process) that's guaranteed to provide fully integrated communications for all your technology and non-technology needs as well as provide significant return on your investment with an ROI of only 9 months."

Blather! I know you're thinking you sound impressive, but from a prospect's perspective it's downright intimidating. Their eyes slowly glaze over and before long, you've lost them.

To be a successful communicator, you need to talk like a normal human being.

Here's an interesting tidbit that supports this premise: A language monitoring serviced analyzed the recent VP debate. Palin spoke at a 9.5 grade level, while Biden spoke at an 7.8 grade level. (Full article here.)

Both candidates are focused on connecting with voters, not impressing them. I have no doubt that they could have easily spoken at a much higher grade level - which would have meant bigger words, longer sentences and more complex sentence construction.

However, they chose not to do that. They wanted to relate to us.

If we're focused on impressing prospects with our vast knowledge, we'll lose them. They'll feel stupid. They won't open up. They won't ask questions.

And we won't get the business!

Question for you: Have you ever caught yourself trying to impress customers? What happened? Were you able to recover?

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Thursday Night Marketing News

Yum, a Burger bar.....

Retail

September Same-Store Sales Sink; Outlook Is Dim

by Sarah Mahoney

The only bright spot: Walmart's same-store sales in the U.S., excluding fuel, gained 2% compared to the same period a year ago, even with hurricane season forcing many closures. And sales at the company's Sam's Club unit gained 4.6%. At Costco, sales gained about 6%, while rival BJ's Wholesale Club saw a gain of 5.6%. ... Read the whole story > >

Pharma

Osteoarthritis Rx Meds Market May Hit $4 Billion By 2017

by Aaron Baar

Several disease-modifying therapies could receive approval in the next few years. According to Decision Resource's Amy Whiting, Servier's Protelos could be approved by 2011, and off-label use of Novartis/Nordic Bioscience/Emisphere Technologies' yet-to-be approved SMC-021 could fuel the market. ... Read the whole story > >

Automotive

Honda Trumpets 'William Tell' Overture Engineering

by Karl Greenberg

The documentary-style TV spot shows the high-desert Avenue K, really a highway through the outback, as trucks, steamrollers, drill rigs and a road grader lay down a new strip of asphalt; team members (not actors) do the calculations on the road to determine spacing for the notes in the overture and create the proper grooves in the new asphalt. ... Read the whole story > >

Strategy

General Mills Goes Grassroots For Sweepstakes

by Les Luchter

The sponsors plan drives in the Los Angeles, Northern California, Houston and Chicago markets. "The idea is to give as many people as possible a chance to enter by taking the sweepstakes beyond the typical channels, and directly into the community," says the editor of Que Rica Vida magazine. ... Read the whole story > >

Food

Pillsbury On The Upswing, Chef Boyardee Not So Hot

by Karlene Lukovitz

Particularly in the current economy, something like a noticeable price increase can have a "fairly dramatic" negative effect on a brand's value perception, and therefore its overall index ranking, says Ted Marzilli of YouGovPolimetrix. ... Read the whole story > >

Automotive

Sagging Auto Sales Spur Dealers To Focus On Online

by Karl Greenberg

Half of the dealers surveyed opined that follow-up and lead conversion will be more important than used vehicle or service departments in the current economic bog. Per the survey, 91% of dealers are either increasing or maintaining their Internet marketing spend, despite tighter budgets. ... Read the whole story > >

Old Navy On Board With Crispin Porter + Bogusky

Burger King To Bow Burger Bar

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Walmart Lowers the Bar

As long as they're not tainted with Chinese lead paint, looks like a good deal:

Wal-Mart Sparks War Among Big Toy Sellers

By MIGUEL BUSTILLO and ANN ZIMMERMAN

Retail price wars are starting early this year, and the latest weapon is the $10 toy -- a signal that retailers are bracing for a rough-and-tumble Christmas shopping season.

Wal-Mart Stores, Inc., which accounts for more than a fourth of U.S. toy sales, last week sent a clear message that it didn't plan to be undersold when it announced 10 well-known toys, including some Barbie dolls and Hot Wheels car sets, for $10.

Associated Press

Wal-Mart has set up displays of discounted toys around its stores as it seeks to lure shoppers and pressure rivals.

KB Toys Inc., the nation's largest mall-based toy seller by stores, told Wal-Mart to bring it on. It cut prices to $10 or less on more than 200 toys, including other Hot Wheels sets, Matchbox cars and classic games such as Yahtzee.

Following Wal-Mart's cuts, which were 25% to 40% below the prices of Toys "R" Us Inc. and Amazon.com Inc., Target Corp. began matching prices on three of the four toys it shares with Wal-Mart's $10 list.

Amazon and the individual toy sellers it promotes on its sites also matched prices, but their discounts were offset by shipping charges. A Barbie Mariposa doll cost $10, for example, but had a $6 shipping fee.

The lower prices highlight an emphasis on high-volume staples as retailers gird for a Christmas season in which cash-strapped consumers may favor no-frills basics over flashier merchandise.

M. Eric Johnson, a Dartmouth College professor who follows the toy business, said Wal-Mart is using cheaper toys to "get people into the stores, but not necessarily giving away the store." Supplies of the $10 toys are ample but scattered across store aisles, he said.

"It feels more laser-focused, strategic kinds of moves to drive behavior, but not the good, old Wal-Mart that cuts prices everywhere," said Prof. Johnson. Still, any rival that follows Wal-Mart's cuts on those toys "will definitely be losing money," he added.

Wal-Mart's pinpoint cuts this year contrast with 2003 and 2004, when it slashed toy prices across the board in an aggressive bid to gain a larger share of toy sales. The brash move showcased the enormous pressures the retailer can apply to prices -- and devastated some of its competitors.

Toys "R" Us lost its status as the nation's largest toy seller by revenue to Wal-Mart in 1998. After a bruising 2004 Christmas, it was bought by investors including Bain Capital Partners LLC and Kohlberg Kravis, Roberts & Co. for $6.6 billion.

The Wayne, N.J.-based company now believes it can succeed this year by selling a wider selection. Parents can find Star Wars toys that fit a variety of budgets. It also believes it has a better handle on the season's trendy toys, such as Elmo Live, an animated version of the Sesame Street character that will sell for $59.99 beginning Oct. 14.

Wal-Mart is betting big on Elmo Live, too, and will sell it for $59.88.

Gerald L. Storch, the company's chief executive officer who joined Toys "R" Us in 2006, downplayed the emphasis on lower-priced toys, predicting that parents will continue spending more on toys, despite the economy.

"Christmas will come, and parents will buy toys for their children, just like they have in all the 60 years Toys "R" Us has been in business," he said. "We know some customers will be stretched these holidays, and we plan to meet them. But value is not just about cheapness."

KB Toys declared bankruptcy in 2004 after a cutthroat price war with Wal-Mart. A unit of Prentice Capital Management LP took majority ownership in 2005, and began closing about 150 underperforming stores last November amid continuing problems.

But the Pittsfield, Mass.-based retailer, which now operates about 430 stores, down from more than 1,200, believes it has a winning formula in discount toys. The company sells videogames or two DVDs for as low as $9.98. The items are generally older and less fashionable, but still in demand among cost-conscious parents. "This is going to be a very competitive season, yes, but our sales are robust," said Geoffrey Webb, the company's director of advertising and sales promotion. "Our traffic counts and comp sales are up, and not many retailers can say that," he added.

Write to Miguel Bustillo at miguel.bustillo@wsj.com and Ann Zimmerman at ann.zimmerman@wsj.com

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Creative Product Placement in Newspaper

This is from Mediapost this week:

Pick Your News: Paper Prints Customized Front Pages, Courtesy Of Nissan

What news and pictures would you like to see on the front page of your Sunday morning newspaper?

That question was posed to subscribers of O Estado De S. Paulo (The State of Sao Paulo), a daily newspaper published in Brazil, over the course of two Sundays.

Sunday subscribers received a blank front page one week, featuring vacant boxes where headlines, pictures and copy normally appear.

Subscribers were given a task: generate the news and pictures that they themselves would like to see in the paper.

Below the fold was an ad for Nissan, the brand behind this initiative. “Escape the pattern. You, yourself should write the news,” began the ad.

Inside the ad, created by Lew´Lara/TBWA, were instructions for readers to create their own front page, which consisted of going online, clicking on a Nissan banner ad, writing headlines, uploading pictures and proofing the finished product before submitting the work.

Imagine the surprise of subscribers the following Sunday when each person that submitted a customized front page received their news and pictures printed on the cover of O Estado De S. Paulo. More than 1,000 personalized front pages were created and distributed; a Nissan ad at the bottom of the front page exclaimed, “we proved that deciding what should be the news is out of the pattern.”

A full-page Nissan ad on the next page read, “Now that you’ve read the news, you have a whole day to buy a new car.” Subtle, it’s not, but it is a great way to connect readers who are used to getting their news from traditional media with digital options to “escape the pattern.”

The sheer volume of customization needed to undertake such a project is also impressive, and not seen often in newspaper campaigns.

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New Ad Campaigns for the week

From Mediapost:

Swedish Fish: friends you can eat. ASICS tugs at my shoelaces. No need to vote, things are fine. Let's launch!

Ask.com has made some changes to its site and launched three TV ads created by its new agency, Hanft Raboy & Partners New York. Nagging questions take on a human form, with a head that rests on the shoulders of people that need answers. A pregnant woman wonders where her Kegel muscles are and whether it's safe to have sex in the third trimester, among other burning questions. A policeman wants to know when "Cops" airs on TV and how he can make his mustache thicker in another ad, seen here. An eighth grader wants to put on muscle and converse with girls in the final ad. Oh, and did I mention that all the lingering questions have accents! Intriguing. Mullen handled the media buy.

New York City's 42 Street Shuttle train has been branded with ads inside and out to promote season three of History's "Cities Of The Underworld." Interior wraps have been executed for years -- I'm partial to HBO's Deadwood campaign from 2005 -- but an exterior ad wrap is a first. So is it safe to say that the MTA will not be raising fares? I'll keep dreaming. The series follows urban explorer Don Wildman hundreds of feet underground to explore hidden gems that make up the groundwork of cities. What better place to advertise than underground? See the shuttle pictures here, here and here, created by CBS Outdoor and Horizon Media.

I love Stephen King, Yankees-bashing -- and SportsCenter ads combining those things. Thank you, ESPN. Kenny Mayne tells viewers that anchors write their own material... most of the time, in "Ghostwriter." Occasionally outside sources are brought in, like diehard Boston fan Stephen King, who writes that the Red Sox defeated the Yankees because New York's lineup was possessed by the demon. I've fallen for stranger things. See the ad here, created by Wieden + Kennedy New York.

Swedish Fish launched a print campaign using the tag line, "A Friend You Can Eat." Is the candy positioning itself as a "friend with benefits"? Ads compare Swedish Fish to friends that you wouldn't dare eat. A man's head is topped with a salad in one ad with "nej," the Swedish word for no, placed underneath. A Swedish Fish is next to the salad head with "ja," Swedish for yes, nearby. The campaign can be found in issues of People, Rolling Stone, ESPN and Us Weekly. Other ads show a kitten in between two slices of bread and a teddy bear in a panini maker, complete with grill marks. See the ads here, here and here. JWT New York created the campaign and Mediaedge:cia handled the media buy.

American Airlines launched "Producer," the latest TV spot under its "We Know Why You Fly" umbrella. The ad shadows a film producer who's working with an eccentric director on a film about Parisian squirrels that ride scooters. The director constantly changes locations, which leaves the producer with limited rest time except for international flights in American's Business Class. See the ad here. TM Advertising created the campaign and handled the media buy.

I was waiting for a provocative voting campaign to come along and push the public to vote. Here it is. Borders Perrin Norrander and Pollinate Media created a pro bono print and online campaign that does a great job illustrating important issues facing the country, along with the nonchalant tag line, "Don't Vote. Things are fine just the way they are." A Web site houses all downloadable creative, and various ways to spread the word to voters of all ages. Ads depict the blurred line between church and state, a backwards healthcare system, a melting Antarctica, the Statue of Liberty giving the middle finger and a gas pump in the shape of a noose. See a bevy of ads here, here, here, here, here, here, here, here, here, here and here.

ASICS is a brand that really knows how to speak to its target audience. The company launched a print and outdoor campaign promoting its sponsorship of The 2008 ING New York City Marathon. "Sound Mind x Sound Body x New York = Heart" read the ads, featuring runners kissing the finish line and showing what exhaustion really looks like. See the ads here, here, here and here. In addition, runners can enter the "Tell Your Heart Story Contest" by sharing inspirational stories to win a chance to be in a TV commercial that will air during the marathon on November 2. Vitrorobertson created the campaign and OSI handled the media buy.

The Sports Museum of America launched a print and outdoor campaign that replicates different facets of the museum. "Sometimes politicians lead our country. Sometimes athletes do," reads one ad that shows Jackie Robinson shaking hands with Duke Snider as he crosses home plate. Another ad features Brandi Chastain celebrating the World Cup Soccer win with her jersey in-hand, along with the copy: "Work hard and one day kids may hang posters of you in their bedroom." See the ads here, here and here. The Gate Worldwide created the campaign and Spero Media handled the media buy.

PrepareForTheFuture.com launched last week to support the Oct. 28 release of "Fallout 3." The incredibly elaborate global site serves as a window into Fallout's violent retro-futuristic world. Content is viewed through an aged TV that features nine channels of 50's-style ads that transition into video game content. AKQA and Bethesda Softworks created the site, which is part of a larger campaign for the game.

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