The Next Pepsi Failure

26 02 2012

If at first you don’t succeed, just re-brand it and launch it again. The customers will never know.

At least that’s how Pepsi apparently thinks. Coming this Spring is Pepsi Next, which is no fewer than its fourth attempt to introduce a mid-calorie cola.

Starting back in the mid-1980s with Jake’s Cola, and then through successive decades with Pepsi Edge and Pepsi XL, the Number Two soft drink maker remains convinced that Americans want a soda with 60 calories. Arch rival Coca Cola has also made the same mistake (with C2), but at least they learned from their failure.

Pepsi Next comes hot on the heels of yet another oddball calorie offering, that being DP10 from Dr Pepper. DP10 touts having 10 calories…but what they forget to tell you is that it is 10 calories for an 8-ounce serving. Regardless of packaging size, Dr Pepper continues to confuse everyone with the 10-manly-calories catchphrase. For a convenience store bottled soda (20oz bottle), it really has 25 calories.

To Pepsi’s credit it has not explicitly declared if it is targeting males. Pepsi is rumored to be working with Simon Cowell’s X Factor, a singing competition show that is probably not going to draw the same viewership that Dr Pepper is targeting.

But target markets aside, why can’t Pepsi learn from its past mistakes? After 25 years and three failed brands, you would think that lessons would be learned. And why would they go to all this effort and expense (repeatedly) to just cannibalize their own market share? Surely they don’t think they are going to gain much incremental business. Especially when those who truly want a mid-calorie drink can just mix a little Pepsi and Diet Pepsi to achieve the same result.

This is an idea whose fizz went flat a long time ago. Can anyone say Darwin Award nominee?

Dr “Shallow End Of The Gene Pool” Gerlich





Suddenly Shopping

26 02 2012

It’s funny how everyone likes to talk about how easy online shopping is compared to its brick-and-mortar counterpart. But anyone who tries to buy merchandise from multiple outlets on the same day knows that even the modern, newfangled convenience of e-commerce can become a taxing situation. Having to enter (and re-enter) personal information and credit card numbers each and every time you buy something can start to become time-consuming.

Which is why Suddenlee shopping makes so much sense. It brings over 300 online shops together under one account, and provides next-day delivery of your purchases all in one box. It’s not a whole lot different from local restaurant delivery firms that bring together the entrees of many food service providers.

As I tell my students, never assume that all the innovations have been made. Each change, regardless of how continuous or discontinuous, brings with it a whole slew of new problems and opportunities. This is yet another example. E-commerce may have allowed us to shop in our pajamas, but all that clicking could lead to carpal tunnel syndrome.

The only problem with Suddenlee is that it’s only available in the northeast US. Everyone else will have to wait while the company figures out how it can expand.

Here’s how it works: Suddenlee has partnered with several hundred vendors (some of which do not even sell goods online), to create a virtual shopping mall. Once your order is placed, Suddenlee sends employees out to purchase the items from a tree-state area (PA, NJ and NY). Standard overnight shipping rates apply; Suddenlee adds $2.50 for each purchase you make starting with the third vendor.

The consolidation that Suddenlee provides (not to mention overnight delivery) is a huge attraction, and no doubt one that consumers in the current service area like. I suspect there are many people throughout the rest of the US awaiting expansion into new markets. By being able to put all purchases into one box, the customer saves money on shipping.

But for the life of me, I can’t figure out how Suddenlee makes much money on the deal. This is a very labor-intensive service. Covering parts of three states means there’s a lot of running to be done, at a time when gas is increasingly expensive. Unless Suddenlee has negotiated discounts with its vendors (and thus marks up everything) as well as its overnight courier, the margins in this business must be slim. The $2.50 vendor fee only kicks in after the second source, and unless the runner is picking up purchases for many Suddenlee customers at the same time, it could quickly become a fool’s errand.

But I must give some credit where it is due. Bringing the wares of 300 shops together is an admirable feat, and come Christmastime, I can see Suddenlee being inundated with orders. As long as the vendor selection meets my needs, being able to make one transaction is very appealing.

Because in a matter of minutes I could find myself suddenly sleeping. Sure beats having to spend time doing the thing I like the least.

Dr “Delivering The Goods” Gerlich





The Write Stuff

24 02 2012

There has always been a dark side to Marketing. In a society in which the primary burden is placed on the buyer rather than seller, it means that the balance of power is seldom in the hands of people like you and me. And while the internet has been the great leveler among business small and large, as well as for consumers with regard to information acquisition and comparison shopping, the truth is that this is no democracy.

No, it is a tyranny.

Take, for example, the current proliferation of fake online and mobile reviews. Now there has always been shady copywriting in advertising, so this is really nothing new. I have always held suspect gushing movie and book reviews (“A real page-turner,” “A farcical romp for the entire family!”). I know that some companies have used guerrilla Marketing techniques (like placing shills in tourist meccas, begging you to take their picture with that neato shiny brand new digital camera their employer is hawking). And I am fully aware that paid product placement happens in the movies and on TV all the time. It was no mistake that Met-Rx was atop the fridge in Friends.

But now things are getting out of hand. It has gotten to the point that you just can’t be sure about anything you read. Sites like Fiverr.com let anyone hang their shingle, announcing their willingness to do tasks for $5…which apparently now include writing fake reviews. And it is entirely possible that book reviews at Amazon may have even been written by the author…using a pseudonym, of course. Buy the book, baby!

In this era of ghostwriting tweeters and status updaters (who among the stars actually writes their own tweets anyway?), maybe I shouldn’t be too surprised at the onslaught of puffery. It’s a digital minefield out there, and we just have to be more careful where we step.

As an example, I downloaded an app from a large regional retailer. I tried to use it, and found that it had a horrible user interface. I even deleted it and then reinstalled it. Finally, I went back to the App Store to read the reviews. There were only 11…seven who completely dissed it, and four who said it was without doubt the best thing since the invention of the iPhone.

Yeah, I can spot an employee a mile away.

It just means that we consumers now have an even bigger responsibility. Being informed means more than just reading one set of reviews. No, we now have to embark on a fact-finding mission, gathering up reviews from a multitude of platforms and venues, performing a meta analysis of all these disparate voices.

And if you happen to think Hell has a special place reserved for Marketers, you may just be right. The reviews say it’s pretty warm, though.

Dr “You Got That Right” Gerlich





I Am *Not* Hooked!

23 02 2012

I can quit anytime I want. Heck, I’ve been doing this for over 15 years.

I’m talking about the internet, of course. The problem is, I don’t want to quit. And, according to the folks at Mashable, there’s a lot of other people who are hooked and don’t want to quit. And for a variety of reasons.

Many studies have been done at the academic level regarding the Uses and Gratifications of internet usage. Mashable’s Infographic puts it all in layman’s terms. Basically, we kinda dig what we’re able to do online, and it has become like a digital cigarette. It’s a hard habit to break, especially when you don’t want to.

I am one of the lucky ones, I suppose. I “have” to use it, since I teach online most of the time, as well as teach about all things social and words prefixed by an e-, i-, m-, or s-. But that is probably just a flimsy disguise for the fact that being online perfectly suits my personality.

But personality aside, the internet can truly become more than just an addiction. It can become dysfunctional to the point of alienation. Do you find yourself compulsively checking your phone for email? Facebook replies? Tweets?

You may just be addicted.

Can you go more than a couple of hours without checking in to any online portal? If not, you may just be addicted.

Do you keep your phone or iPad within a couple of feet while sleeping? OK, I’ll try to quit talking about myself.

It’s OK to have addictions. The problem is when you allow them to interfere with other facets of your life. If you’re out with friends, family or colleagues, it’s probably not a good idea to keep checking your Facebook.

But I will confess to laughing while in social groups, waiting for the first person to sneak a peak at his or her phone. Know what happens next? Everyone else quickly feels justified in checking their phones for incoming messages.

Messages that could no doubt wait, but heck, Joe over here is puffing away on the internet, so it’s OK for the rest of us to light up.

They say that the first step to recovery is admitting you have a problem. And while I know that I do use the internet an awful lot…OK, a ton…it’s only a problem if it starts hurting personal or professional relationships. Until that time, though, I suppose we can all agree that the internet is the crack cocaine of the digiterati. And you had better step aside when we start having a jones. I’ll try to keep it short and under control, but it’s not easy.

That’s what happens after 15 years.

Dr “Facing Two Hours In The Air Today Without A Signal” Gerlich





Get Yer Goggles

22 02 2012

I suppose it was only a matter of time. Minority Report and Terminator are becoming reality. Believe it or not, by the end of this year we could all be wearing Google Glasses.

That is, as long as you’re willing to pony up the price of a smartphone for these shades. And…um…are willing to risk looking like an uber-nerd.

The specs run on Android (are you surprised?), and are perhaps the first big splash of augmented reality products to come our way. Sure, we have AR apps in our phones, but now they are branching out into wearables. I also hear rumors of interactive AR household mirrors and other gadgets throughout the house…all running on Android.

Bold Google Glasses owners will be able to simply point their nose at anything, and get instant feedback on it. It’s a lot like the latest Google app I wrote about recently (think camera and microphone), but now we won’t have to be bothered with all that aiming and tapping.

So here is how it works: Only one eye will see the heads-up display (HUD), so that you don’t walk into traffic, buildings or other people. And scrolling and clicking are accomplished by tilting your head up or down, and then a brief head snap to click.

You read that right. How weird is that? Kinda makes you want to be someone other than an early adopter, right? Just don’t try to do this while carrying on a conversation with someone. Your nod of agreement could send your visual display into a tailspin.

While I am being rather quick to naysay Google Glasses, I should in all honesty point out that I naysayed the iPhone back in 2007. Who among us, I reasoned, would want to replace their quality digital camera, 64GB iPod and cell phone for one handy device?

Um, me, as it turned out. Excuse me while I remove some egg from my face.

But confessions aside, I guess I am just not yet ready to be wearing a visual display unit. Heck, I’ll need prescription lenses to begin with ($). And I definitely don’t want to be seen wearing these around the office. People think I’m weird already. I don’t need any help.

I know. In a couple of years we’ll be sporting these dandy shades, tilting and snapping in our own little worlds of information procurement. For now, though, I’m ready to terminate this discussion.

Dr “Minority Reporter” Gerlich





Bullseye

21 02 2012

Life was so much more private back in the days when we used cash for everything. Retailer point-of-sale systems did not have bar code readers; individual items were categorized with only a few descriptors, limited by how many unused buttons were on the cash register. From an inventory control and marketing research perspective, it was pretty much useless. But at least customers had some degree of anonymity.

But now we are as transparent as Glad Wrap. Thanks to credit cards, debit cards, check and loyalty clubs, retailers are able to track each and every purchase we make, simultaneously adjusting inventories and reorder points, along with building complex customer profiles.

Yes. Profiles. As in, “We know what you did last summer.”

So I was not at all surprised when my colleague, Dr Rex Pjesky, posted this story on my FBH Wall about how Target figured out a teen girl was pregnant. Before her father knew. Turns out Target was sending baby-related direct mail pieces, and Dad accidentally saw them. Can you say surprised?

So much for secrets.

That Marketers know everything about you really is no secret these days. It’s just that we tend to forget that they are watching. All. Of. The. Time. Worse yet (or better, if you are a marketer), they have amazingly accurate algorithms that can predict if you…well…happen to be pregnant. It’s not a whole lot different from the data mining that goes on with Pandora’s Music Genome Project, or Amazon’s inexplicable ability to find something else that you need to buy (because “Others who bought this also bought…”).

Which means that we are all unwittingly contributing to an ongoing data collection project focused on you. Me. Every single one of us. And every time we purchase something anonymously (i.e., cash sans loyalty card), we are making another contribution to the ol’ database.

I see the effects of this every time I open my Netflix account. I am bombarded with suggestions to watch teen TV shows and animated movies. Of course, my kids have completely hijacked my Netflix account, so I should expect no less. But I do take a little delight in thinking that, somewhere deep within the corporate belly of this movie giant, someone is wondering, “Now why the heck did the Gerlich kids watch The Wild and Wonderful Whites of West Virginia?

Score one for Dad. I actually was able to watch something I wanted to watch.

Still, I cannot blame Target, although the Dad in me admittedly would be surprised and probably furious to find out my teenage daughter were receiving baby-related junk mail. I think someone would have some ‘splainin’ to do.

Now about those two cases of microbrews I purchased two weeks ago in Albuquerque…

Dr “In The Cross Hairs” Gerlich





Social Drinking

20 02 2012

Everyone knows you have to have a Facebook page. Everyone knows you need a presence on Twitter. but for the most part, few people know how to actually deliver the metrics of these social media outlets. Sure, we can report Likes and Followers, but is there anything else we can say?

As it turns out, there is plenty. It’s not perfect (as I will explain), but it’s a start. Take, for example, the New Belgium Brewing Company of Fort Collins CO. They are reporting that their main Facebook page is now worth over $50 million sales.

Well hot damn, bartender. Another round!

NBB is the third-largest craft brewer in the US, and is best known for Fat Tire Ale, their signature product. And I would be remiss if I did not mention that I am a NBB junkie, having been to the brewery no fewer than five times (and returning this summer, of course). I have the oh-so-cool bicycle neon light. It’s a true Mom-and-Pop operation, extremely employee-friendly, and committed to sustainability.

Which probably explains why they continue to encourage bike-commuting to work, and reward employees on their first anniversary with one of those rare Fat Tire cruisers.

As it stands, NBB counts some 211,000 fans on its primary page, and over 400,000 among its fleet of pages. The brewery reports that it surveyed followers of the main page, and found the typical user spends $260 per year on NBB product. This translates to $54.7 million in sales, or about one-half of total company sales.

All this, and the company only spent $235,000 to maintain its social media presence. Can anyone say ROI?

While the NBB folks are understandably giddy about this revelation, I do need to caution that they cannot completely attribute cause and effect. For example, those 211,000 fans may very well have continued their drinking ways without Facebook ever having been introduced.

At the risk of being branded a heretic, I need to add that, while Facebook is a great method of reinforcing the brand as well as allowing for interaction, it is still yet unproven in most circles to actually contribute to sales at the margin.

Even for those companies engaged in social commerce at Facebook (and soon to be on Twitter), it would be very difficult to isolate completely new sales versus what is happening through other established means. And even if company sales were to increase overall, it is difficult to isolate the root cause.

In other words, an increase in sales could simply reflect expansion into more states, changing preferences for craft brews, and thirstiness.

Just thought I’d throw that out there.

Still, that companies are starting to monitor their social media presence is a huge step forward. While we still have imperfect measurement methods, we are making progress. If anything, NBB can be happy to have 211,000 sets of eyeballs on its main page. It’s a microphone that never shuts off.

What’s more, the lesson to be learned from this one regional brewer is one that can be applied to virtually any business. Any company with a social media presence needs to be gathering as much data as possible, and tracking every last nickel and dime. Because at the end of the accounting year, it all adds up.

And that, my friend, is something to which we should raise a toast.

Dr “Prosit!” Gerlich





#loweshatesmuslims, Or, How To Screw Up In Social Media

20 02 2012

Lowe’s Home Improvement Stores announced on Dec 10, 2011, that it had pulled its advertising from TLC’s All-American Muslim, an 8-part documentary chronicling the lives of five Muslim families living in the Detroit area. Referring to the show as a “lightning rod,” Lowe’s had come under fire from individuals as well as the Florida Family Association for advertising during the show.

The decision resulted in a firestorm of activity. Lowe’s responded by posting a statement/apology on its Facebook page. This produced over 28,000 comments, many of which were vitriolic in either their support or criticism of Lowe’s.

Lowe’s subsequently deleted its apology as well as the comments. This produced more controversy, with Twitter users launching the #loweshatesmuslims hashtag. This resulted in thousands more comments on Twitter, but because Twitter does not regulate the use of hashtags, Lowe’s could do nothing.

Shortly thereafter, Lowe’s then posted another apology on its Facebook page, this time keeping user comments online.

Although Lowe’s was not the only company to pulls its advertising from AAC, but it bore the brunt of the media attention.

MediaBuffs launched a nationwide online survey within days of the controversy. The purpose of the study was to measure consumer attitudes toward Lowe’s, as well as their likelihood of shopping at the store in the future.

A sample of 379 participants was utilized; all 50 states and Washington, D.C. were represented, thus guaranteeing a good cross-section of American views. Participants ranged in age from 1 to 76, with an average of 35. The sample was balanced with regard to gender (48% males, 52% female), as well as political affiliation (Republican, Democrat or Independent).

The study applied the Theory of Planned Behavior, a comprehensive theory used widely in Marketing, Management, Communication and other fields. TPB is often used to predict consumer behavior based on the antecedent conditions of attitude, subjective norms, and perceived behavioral control. As a result of these components, influence may then be felt on a person’s desire, behavioral intention, and ultimately, planned behavior.

The survey included scale items that measured all of the various constructs. A method called Structural Equation Modeling produced a path model that showed the relationships between all of the variables.

The results showed that, while users did not have any clear attitudinal predisposition toward avoiding or not avoiding shopping at Lowe’s, it was the perceived peer pressure of subjective norms that predicted they will avoid shopping there in the future. In other words, people were willing to alter their shopping behavior based on what they thought their friends and family members would prefer they do. In this case, they perceived these people to prefer they not shop at Lowe’s

Pulling ads from the show inadvertently created a bigger problem than the ads did in the first place. This shows the power of social media in not only disseminating information and welcoming reply, but also the effect it can have on the brand.

It remains to be seen whether consumer plans to avoid shopping at Lowe’s will continue long-term. It is possible that, over time, people will forgive or forget, but this is no certainty

Companies must be cognizant of how powerful social media can be. Decisions must be vetted fully before enacted, because it is impossible to take the microphone away from anyone on Facebook or Twitter.

MediaBuffs is a consortium comprised of research principals Dr. Kristina Drumheller (Assistant Professor of Communication), and Dr. R. Nicholas Gerlich (Professor of Marketing and Department Head). Both are on the faculty at West Texas A&M University. They conduct academic and marketing research online at mediabuffs.org, as well as in the classroom and offsite for clients. They can also be found on Facebook and Twitter. Associates from WTAMU and other institutions join them on selected projects.

Joining Drs. Gerlich and Drumheller on this project were WTAMU colleagues Dr. Emily Kinsky (Assistant Professor of Communication), Dr. Meagan Brock (Assistant Professor of Management), and Mr. Marc Sollosy (Instructor of Management).

Dr “That’s The Down Lowe’s” Gerlich





The In Group

20 02 2012

There is no doubt in anyone’s mind that upstarts like Groupon and LivingSocial have upset the retail apple cart in the last two years. It has put local media on notice that companies that are “not from around here” can have a local presence, and effectively siphon off marketing dollars. In Amarillo alone I have seen the newspaper and at leas a couple TV stations launch counterattacks with similar efforts.

The basic idea (once again, for you cave dwellers) is this: Daily deals are offered (mostly via email, but some by web and/or print) that try to entice people to buy at what appears to be an insanely low price. But you must act quickly, because the model dictates the short-term nature of the promotion. And in the case of Groupon, a vendor-determined minimum number of people must buy for the deal to tip.

Of course, such promotion-heavy inducements can also create deal-prone consumers. I should know, for I am one. I have purchased eight Groupons for canvas photo prints, each at 50-60% off list price. Groupon’s take in all of this is 50% of the sale price, which means that the vendor is selling items or services for about one-fourth of list price.

Yes, you better be careful in this arena. You may wind up giving the store away.Worse yet, while the intent is to try to introduce new customers to your shop (in hopes they will return later to purchase at regular price), there is no guarantee that all Groupon et al have done is create a new bargain-hungry class, as in folks who will never return…unless there’s another Groupon.

But now Groupon and LivingSocial are raising the revenue bar by offering premium memberships. In Groupon’s case, $30 a year gets you first dibs on promoted items, overrtide privileges on sell-outs, and other benefits. LivingSocial’s premium package is quite a lot more expensive ($20 per month), but offers similar perks.

OK, everybody step back from this for a sec. Where have we heard of this before? Oh yeah…Sam’s Club, Costco and BJ’s. Membership shopping clubs. You pay for the privilege of having access.

And if enough people bite, this stands to greatly improve Groupon’s bottom line. After all, it’s pretty much pure profit, and that from the people most likely to spend more in the first place. Can anyone say Bazinga?

Having never been shut out of a Groupon, nor so obsessed with what is coming tomorrow, I just can’t say that the new VIP program is for me. I have never suffered from any Groupon angst, and am in fact quite happy with my bargains. One more thing: I have yet to purchase a canvas photo print at full price. Call me a cheapskate, but I have learned that this offer will make the rounds about every two months. I just keep my photos organized, and am ready to pounce.

But if Groupon and LivingSocial can pull this off, I tip my camera. Any time a marketer can convince its best customers to pay more just for the privilege, it’s something to write home about.

And that’s a picture the stockholders all love to see.

Dr “Say Cheese” Gerlich





2D Or Not 2D

20 02 2012

They’re everywhere. In print ads. Outdoor advertising. Taxis. Signage. Product packaging. Even the Tube in London. If you have not yet seen a 2D (aka QR) bar code, you must have been living in a cave.

These so-called Quick Response icons operate just like the bar codes found on packaged goods, except they are for consumer use rather than inventory, price-checking or checking out. For the 50-percent of USAmericans with a smartphone, free scanner apps are available that allow us to scan the QRs and then be whisked off to web content.

Of course, if you are riding in the Tube, they are pretty much worthless, because there are no cell signals 100 feet below the surface.

But above ground, they serve a multitude of purposes. They are a great way to subtly issue a call to action, and then present viewers with far more content than could displayed in the space occupied by the code.

But some people think that QR codes will not last. And a big part of me agrees, albeit for possibly different reasons.

As it stands, only 5-percent of us have actually interacted with one. That’s a speed bump if there ever were one. This translates to about 10-percent of smartphone users scanning a code…pretty low for a device that is touted as being to do everything.

From my corner of the intersection, I see the problem being more one of clutter than getting people to open up an app. There are so many QR codes littering the landscape that we could not possibly attend to all of them. And never mind that they all look quite a bit alike.

Another problem is lack of standardization. At present there are five different QR formats, and one app does not work on all formats. For example, without the TagReader app, you cannot read the colorful little triangles in the Microsoft version of QRs. Which means you cannot scan anything in a hard copy of the USA Today.

And you thought it was difficult reconciling Microsoft and Apple products.

But other critics argue that QRs will have a short shelf life because better scanning apps are available, apps that can look at a product, building, virtually anything, rather than a bunch of jagged little squares. From these apps we will be able to access product information and even make purchases. Need more information on the Grand Canyon? Aim your phone at it.

Ironically, though, for all the bluster in the linked article, this app has already been available for over a year. It is…drumroll, please…the Google Mobile App. And you were expecting something more exotic.

Better yet, this app comes with both a camera and a microphone interface. This allows me to aim at any object and get quick feedback (not always right, mind you), or speak. Just a minute ago, while pondering lunch, I spoke the words “Mexican restaurants,” which resulted in a results page showing me places in both Canyon and south Amarillo whereby I could satisfy my desire for chips and salsa.

While this is all nice, I do not see this as being a five finger death punch for QR codes. QRs can lead to far richer media content, whereas Google’s visual/audio search only produces the same kinds of things you would do with their search engine.

You see, there is a huge difference between basic search and the desire for additional content. And while I will admit to using the camera for laughs and giggles among friends, I don’t think the quality of returned information is as meaningful as what can be done via QR codes. QRs take the guesswork out of the equation, and send users to a specific place, whereas Google results give a variety.

And sometimes nothing at all. I tired it on a large canvas print in my office of UK’s Stonehenge. It choked completely.

That’s another way of saying that, as for the QR code, reports of its death are greatly exaggerated. Unless you’ve been living in that cave, in which case this is all moot anyway. Smoke signals, anyone?

Dr “It’s In The Scan” Gerlich