Do you have more money than sense? Would you like crystal encrusted water?

Image

Today I came across Bling H20. Bling H20 is a brand of bottled water that is quite clearly on another planet. A typical 1 litre of bottled water will set you back £37, simply by placing Swarovski crystals on the bottle they have been able to create a brand aimed at the super rich (that clearly have more money than sense).

Bling H20 Is a positional good. Defining the brands position by its value, customers are able to perceive a status of luxury and exclusivity associated with the brand. (Fred Hirsch), 1977.

It still does not stop the fact that even Grey Goose vodka is less expensive and water is available from a tap!

Similarly another great example of a positional good is Chanel No.5.

Image

Here’s an interesting fact for you. You will NEVER. I repeat NEVER see a Chanel No.5 bottle be sold in a sale. In fact every year when shops need to clear their stock, hundreds of bottles of Chanel No.5 are passed onto industrial waste disposal units. I know this because a friend of mine works at a industrial recycling plant and every so often a batch of Chanel No.5 is delivered to be destroyed. (Tragic, I know).

You could say this is a waste, however a brand like Chanel which recently employed Bradd Pitt to advertise their perfume, would not want to be seen dead being sold on sale.

The reasons are symbolic but are grounded in good marketing. So let’s look at the four symbolic reasons an individual buys Chanel

1.) Self-image enhancement

A brand like Chanel is not just there to make you smell nice, it’s their as a statement of who you are and you place in society. If people know you wear Chanel, the idea is people will think more highly of you.

2.) Ego identification

You think you are a well off, high class individual and for this reason buying Chanel No.5 will provide you with the identification to your self image

3.) Belongingness and social meaningfulness

You hang around a social group of well off upper class individuals, by wearing Chanel No.5 you are identifying yourself as part of a social group that you wish to belong to.

4.) Affective fulfilment

Simply knowing that you can wear Chanel No.5 as and when you like provides you with a cognitive fulfilment that you associate with the high class stature of a perfume brand like Chanel conveys to you.

Research has also shown simply by having a greater price you will drive consumers to purchase the product as it is now perceived as a ‘Veblen good’, it has been shown that some people have a greater preference to purchase products as the price increases. Wood, John C. (1993).

We are surrounded by luxury goods, Rolex watches tell you the time, but are priced in the £Thousands, (even though the time on your phone will do the job for no extra cost). Rolls Royce cars do the same job as a Nissan Micra, (it takes you from A-B), however a Rolls Royce is priced often 10 times the price of a Micra.

Clearly luxury goods have their place. I however can do without the Swarovski encrusted bottled water. Tap water is just fine.

How being a hypocrite does not pay. Listen up tax dodgers!

Image

When Starbucks came to the U.K. Few people could perhaps envisage they would be on every major high street in the U.K. Let alone not going 500 metres before coming across your next Starbucks.

But their success has been huge and very rewarding. With sales of £396 million in 2011. It is astonishing that they paid £0 in corporation tax?

Starbucks claim the only reason they have not paid tax is because they have not made a profit, but with sales of £3 billion in 15 years, that is hard to believe.

With the recent media and public backlash to the news they have paid so little tax, seeing an apology from their CEO and a commitment to pay £20 million in tax over the next two years, (more than is required), the treasury may be rubbing their hands.

Image

Kris Ensgkov (MD Starbucks UK): “a significant amount of tax during 2013 and 2014, regardless of whether the company is profitable”.

But when you look at the figures £20 million is less than 1% of the £3 billion in sales Starbucks has enjoyed!

Starbucks is clearly using the bad PR from the news story to generate good PR. Tax is not a charitable donation and is most definitely not something that should be used to create ‘brand value’.

However the use of PR from Starbucks point of view is easy to understand. They have a brand to protect and managing the impressions whether conscious or unconscious is major part of protecting a brands image (Piwinger & Ebert 2001).

So why now? Well when you have a brand like Starbucks that is proud of their ethical considerations to its people, sourcing, environment and diversity (see above picture). Having a pink elephant with the label of ‘tax dodger’ just isn’t acceptable.

As Goffman (1959) stated, Impression management must convey a consistent message with an organisations aims and ethics. So basically being incredibly ethical with your sourcing of coffee but then refusing to pay any tax, kind of makes you a hypocrite. Starbucks don’t want to be hypocrites.

I buy Starbucks; I like Starbucks coffee, would I change my habits just because Starbucks didn’t pay all of their taxes? Probably not. But it would change my opinion of them as a business.

Which is why a further reason for their recent announcement in paying more tax is likely an approach of creating shared value (CSV), the idea is that corporate success and social welfare are interdependent; generating tax revenues is just one way to achieve this. Michael E. Porter (2006). If I value their product and value their contribution to society, their brand value will increase and I’ll walk out of their cafe a happier customer.

Even if they can’t spell my name.

Image

A round of applause for Pampers please

Look at me! Buy our stuff! We’re ethical!

Okay so maybe companies aren’t as obvious as this in trying to gain customers from ethical practices.

Over the last decade the number of companies who have tried to gain an advantage through greater ethical practices has seemingly exploded. This is in large part down to an emerging corporate culture brought about by the notion of corporate social responsibility (CSR). Companies in the late 60’s onwards were beginning to shift away from running a company for the sole benefit of shareholders, but now looking towards stakeholders, meaning people who an organisation has an effect on (Freeman 1984).

Which is all well and good, but thinking about stakeholders does come with costs. Are shareholders really going to be happy if their dividends dwindle as a result of a new ‘charitable’ organisation?

I suspect not.

CSR must therefore make business sense. It must give a company a competitive advantage and bottom line; it must make the company profitable. Otherwise. What’s the point? Right?

Well the good news for all of us it does make business sense, research has shown that when all things are equal between two organisations a consumer will most likely choose the more ethical, sustainable and charitable organisation. Von Stamn, (2008).

A particular brand that stands out for me in their CSR practices is Pampers. Their ‘One Pack, One Vaccine’ has been hugely successful.

Image

Their campaign ticked all the boxes for an effective CSR campaign. This being distinctiveness, Believability and finally relevance. Haapala (2008)

Distinctiveness – No other nappies brand undertook a vaccination campaign, the unique selling point of purchasing this nappies brand was executed very well.

Believability – The ‘One Pack, One Vaccine’ did not just rely on press releases or statements from the CEO, Pampers campaign was presented on national television and on various other platforms. They were very believable in their campaign.

Relevance – The campaign related well to customers, the target of the tetanus campaign was neo natal parents and babies. The specific demographic which Pampers wants to influence.

From a social point of view their campaign was hugely successful. Over 100 million people have been vaccinated and from a corporate point of view they possibly forced Huggies to retreat from European business.

Image

As seen on the BBC http://www.bbc.co.uk/news/business-20068925

Well done Pampers, very well done.

Viral marketing for engagement.

Fancy living in a tropical Island where all you have to do is feed the fish and clean the pool? Interested? See video below for details. http://www.youtube.com/watch?feature=player_embedded&v=5Smi3TuY5Lg In Early 2009, Queensland Tourism launched a somewhat strange campaign for a caretaker position. But it was not any ordinary job advert. This was fantastic viral marketing. Instead of your typical tourism advert which is generic, can cost millions and not very engaging. The Queensland tourism went for the viral marketing route. The campaign itself gathered huge amounts of attention, with mainstream media taking up the story and further swelling the viral effect. (As seen on CNN) (As seen on the BBC) The use of the mainstream media to gather greater attention to a campaign is a tactic that worked well for Queensland tourism, perhaps learning from the same techniques used by Virgin Media and the adventures of the charismatic owner Sir Richard Branson. But the main reasons why this campaign succeeded were the messenger, the message and the environment it was distributed into. Taking the same 3 points needed for a successful viral marketing campaign (Kaplan Andreas M., Haenlein Michael (2011), Queensland Tourism were hugely successful.

Using novel practices such as this is nothing new, viral marketing is all about gaining attention through novel approaches, this campaign has elements of viral marketing, but goes a step further by harnessing the power of public media. (A tactic used by the very successful Richard Branson and Virgin brand.)

As well as being a novel viral campaign, having individuals engage with this advert by actually applying for the job. This further enhanced the exposure, this wasn’t just a competition, this was a way of spreading the message of how great Australia is. People who applied for this job are likely to share information with peer groups, one of the main ways being social media. A 2010 study by Stan Schroeder found that 52% of people view information on social networks and e-mails. Making this most of social networks and the viral nature in which information can spread was done incredibly well.

I’m on a horse?

No, I am not on an actual horse. That would be ridiculous. I am of course the referencing the ridiculously popular viral marketing campaign by ‘Old Spice’

But why has the Old Spice campaign been so successful?

Its nonsensical humour, lack of clear theme and endless variations make this campaign seem never ending. Only today a friend of mine shared an Old Spice video game via facebook. In the game you can ‘save the world’ as retired Congolese American professional basketball player Dikembe Mutombo…because of the need to fight back against the world wide hit of ‘Gangnam Style’ and its ability to stop Americans from voting. No I am not making this up. It really is that ridiculous.

The Old Spice game link that appeared on my facebook news feed

Play the game if you want? You probably won’t finish reading this blog and you’ll probably end up sharing it yourself (and the endless cycle of this viral campaign will continue). Sigh.

http://www.oldspicesavestheworld.com

So why has Old Spice been so successful?

Well let’s look at the three basic needs for a viral campaign to work. (Kaplan Andreas M., Haenlein Michael (2011)

Messenger: The main messenger for the Old Spice campaign is Isaiah Mustafa, a charismatic, good looking, former American Football professional and present day actor. In short. Men want to be like him.

Message: The messages are highly varied, from humorous videos to video games, even adverts selling bear shaped containers; their campaign are highly memorable and likely to be shared

Environment: The environment used to share their campaigns is via the internet, focusing on social networks with their easy ‘1 click’ share button, they are able to reach their target demographic of young men very easily.

Old spice communicates itself well on the three points of messenger, message and environment, however it is important to remember that aspiration of the individual could also be important in their choice to purchase. Most men would not be ashamed to admit they find the Old spice man somewhat attractive and masculine. The Old Spice adverts clearly sell you the idea of being ‘more masculine’, when he mentions “smelling like the man your man could smell like”. Perhaps this is an attempt to get more women to buy into the product?

I think Old Spice man is here to stay.

This blog is now Diamonds.

Adverts that go viral.

I’m bloging about this because it made me laugh.

And I shared it. Because I think it will make others laugh.

I guess that’s the point of viral marketing, It’s not necessary to spend much money to have great brand exposure and you get to be recommended to an adverts content by a friend and not intruded open through an advert placed in the middle of your favourite T.V programme.

The growth of a viral advert can be rapid and brand exposure can increase experientially (Sabrina Helm, 2000).

With the increasing use of the internet to be able to spread adverts it can only be seen that viral marketing will continue to grow.

We are a forgetful bunch. Sometimes.

Think back to the Deep Water Horizon disaster in 2010 and one of the first words that pops into your head is BP.

Following the disaster a campaign of televised apologies, apologetic interviews and compensation paid out in the billions was launched by BP.

Their brand was seemingly in the gutter.

Yet, with a simple TV advert created by one of the leading full service marketing organisations, they were able to take their ‘buzz index’ a YouGov rating from the lows of -73.2 following the few weeks from the disaster to -9.9. In large part due to the effects of the following advertising campaign.

This may not be ‘greenwash’ in the true sense of the word. Where a brand is deliberately deceiving the audience as to the effects its industry can have on the environment. But the above advert does show the instrumental use of media to change perceptions of big business. Vogel (1989).

Of course with such a low brand image after the gulf oil spill you can’t blame BP for wanting to improve their brand image.

I’m not sure which is worse, whether people can simply forget about the worst oil disaster in history, or the ability to be persuaded by a simple advertising campaign.