Friday, 29 January 2010

iPad – success or flop?

What a lot of buzz about the iSlate that turned out to be the iPad? It’s got the whole world talking about it so the Apple marketing machine is still on top form.

So is this all buzz and no substance? Or is the iPad set to be another roaring success?

I think part of us would like to see Apple make a mistake for once, maybe it’s the British way to pull down the giant and see the underdog take a slice, but I don’t think it’s going to happen this time. I predict a success.

There are some arguments that say the product has no real technical innovation. Probably true but I haven’t studied it enough to know. There is another argument that says if you have the iMac and you have the iPhone there is no real need for this product. Also probably true.

However, it looks great, it works like an iphone with all the ease of use that goes with it, and what’s more it’s priced very competitively. I think it will appeal to women and families.

This is not a product for gadget man that has everything already. This is not a product for that bloke who keeps going on about how the Nokia phone is superior (you know the one).

This is a product that will appeal to families where one laptop is always being fought over. This product will attract females who want to use it to communicate, look at photos and browse the web. And you can bet that it beats windows 7 hands down on touch screen ability.

Apple are great at communication. Looks to me like the iPad will be great for all forms of communication so I am voting “success”.

Monday, 25 January 2010

Is Starbucks chucking away its identity?

It’s been tough for the coffee shops in this past year of recession. You don’t need to be Einstein to realise that a £2.50 latte is one of the first things to go when tightening your belt.

However the biggest chain in the world Starbucks has posted better results than expected. In the U.S. home market, Via is cited as taking the credit for this.

What is Via I hear you ask? It’s instant coffee. Yes instant.

Isn’t this just defeating the whole object of Starbuck, making real coffee?

It’s one of those brand stretch ideas that just stretches the wrong way. It clashes with the brand identity. It might have contributed financially in the short term but I would advise concentrating on far better ideas that DO fit into the brand, such as packaged beans and new drinks such as bottled lattes Of course the company needs growth and this can’t just come from store openings but it’s got to be the right sort of growth and takes share of customer purse. If you are a real coffee lover, you’re not going to go for instant.

Another idea Starbuck has got for growth is the opening of a new concept store, the Coffee and Tea store. Thanks to trend hunter for this.

It’s supposed to be more individual, more local, more rustic sort of coffee house, stocking a range of coffee and teas that the mainstream stores can’t offer.

I have got mixed feelings about this. As a speciality coffee shop, Starbucks can’t exist on a large scale. It has to be standardised, not all staff can be passionate baristas and some types of specialty coffee can’t be provided to 15 000 stores. So I can see why an offshoot store might make sense to provide new products, test them out and attract a new customer segment that won’t go the big corporate store.

However I cringe when Starbucks describes the concept.

“Coffee & Tea offers customers new opportunities for discovery, a high level of interaction and a deep connection to the local community.”

Sorry – what?.

“Customers can participate in and enjoy musical performances and poetry readings; they can also bring in their favorite LPs to play on the sound system”

Can any one find an LP? Isn’t this a bit hippy nonsense?

“This coffeehouse design is …. eclectic and raw, featuring locally sourced and reused materials that are one-of-a-kind.”

Eclectic and raw? Pleeease.

“Materials sourced from existing Starbucks locations: floor and ceiling are original; bar top and doors were repurposed from the Seattle University Village store prior to its renovation; chairs were sourced from area Starbucks stores and refinished; and chalkboard frames were made using shipping pallets from the Starbucks Support Center in Seattle”

I actually do like this bit. Grabbing bits of old Starbucks and making them into the new store. One thing though that strikes me after reading all this: is it a Starbucks coffee shop, yes or no?

I think there is some brand confusion here. The stock market is demanding growth and of course Schultz needs to deliver. However the growth strategies need to be well thought out and should look at share of customer purse rather than store openings or new customers.

What things can we sell to the existing customers who are coming inside the door? Think of that massive footfall and how to make the most of that? What other products and services can a coffee shop sell? As well as the bottled take away drinks and beans as mentioned, what about gaming? Newspapers? Books?, Coffee courses?

Wednesday, 20 January 2010

Anyone heard of BOGOL?

By now most consumers are familiar with BOGOF, buy one get one free. It has been the most regular tool in the sales promotion bag for some years now. But this week, Tesco has announced that it is trialling a new scheme “Buy One Get One Free Later”, or as I have christened it – the BOGOL. So what is that about?

Well it seems to have come from a really good consumer insight, (as most of tesco’s ideas seem to). Some customers are interested in Tesco’s Bogofs but can’t use the produce before the sell by date. This is likely to be most common amongst smaller households.

What a neat little idea! According to Tesco, customers can pick up their free product the same day or the next week.

A – ha! So there is the crux of the clever idea. What better way to ensure that customers come back into your store the following week? Personally I flit between two supermarkets, just to vary the experience and for a touch of variety in the products.

No denying that Tesco have done a superb job in the loyalty arena with their club card but the BOGOL offer is better in some ways since I actually have to go in to the store. And who has ever heard of ANYONE going into the shop for ONE item and coming out with just ONE? Or is it just me that walks in without a basket and ends up juggling seven items like a demented clown?

When you consider the strong growth in a one person households as well as lone parent households, the insight becomes all the more powerful.

Oh and Tesco also claim they are helping us with our food waste reduction. Anybody smell greenwash?

Great idea Tesco but let’s not bother trying to pretend you are helping me reach my green target. It’s a great marketing / customer loyalty idea – be proud of it!

Tuesday, 12 January 2010

KFC = Kan’t forget the customer?

KFC – I never eat it, haven’t been for over 10 years. But I do know what they are about. It’s clear, it’s in your face, it’s junk food in a bargain bucket. It tastes good and they don’t care. I love it.

I am already tired of all the TV programs, magazine articles and gym membership leaflets coming through the door. Just as silly season has ended, the mad diet season begins. We must be healthy, we must purge our Christmas sins, we must avoid sugar and fat and run around the park.

But one TV ad caught my eye. It followed the new DVD from the latest newly size 8 celeb, and it was for Kentucky Fried Chicken, or as it is now known KFC.

Chicken, fries, bakes beans, creamy coleslaw and wait for it, full fat coke for a special price. Why cook mum when you can give them what they want?

There must be about 5000 calories in one of those meals. OK I exaggerate, but not much. But KFC don’t care, they know that when people want junk food, that is what they want.

I have to admire this brand for sticking to their principles. While MacDonalds was promoting salads, and Pizza Hut was re-branding to a healthier Pasta Hut, KFC never once waivered from their proposition. Chicken junk food, Finger lickin good. And who can forget the Colonel, an integral part of the KFC brand identity since forever. You have got to hand it to them, they never bowed under the pressure, they just give the customers what they want.

However, new owner group Yum! have in my opinion, entirely missed the point by trialling grilled chicken in the US. What’s more they have reportedly spend over ¼ billion dollars pushing it, offering a free piece to every customer.

The franchisees in the US, who are clearly more in touch with their customers than their parent company, disagree so strongly that they are suing their own company. They believe the brand is losing its focus.

You might not agree with junk food advertising and like me, you may believe that UK has a very serious obesity issue but these fast food places are not the issue, we are, as a society. You also have to admit that the marketing team in charge of KFC have had the (chicken) balls to stick to the brand values thus far and I think they should be allowed to continue.

Tuesday, 5 January 2010

Cast your vote: British Airways or Ryanair as worst airline?

I can’t decide which air company I like less. They are both really trying their best to convince me that they are the worst air company in the world but the decision is really very difficult.

Hidden charges and seats like a slab of concrete or staff that look at you like they want to spit at you and try to ruin your holiday by striking? Mmmm….strong competition.

Airlines have already been in crisis for a few years now. Ever since Ryanair and Easyjet put the cat amongst the pigeons with an entirely new lean business model with low running costs and low fares, the older established companies have struggled. For a while, before the “Great Recession” BA seemed to have found a bit of a niche with business travel charging companies extortionate amounts of money to get horizontal on a plane. But then budget cuts came and profits plunged. BA had never really tackled their enormous cost base they have been carrying since the glory days.

With fresh strikes announced for February, looks like BA’s reputation with customers will plummet to new lows.

I travelled with BA this Christmas, it was efficient, it was on time, it was roomy but the staff are snotty nosed and condescending. They are actually lucky that they didn’t get lynched by us, the poor customers, who nearly missed out on spending Christmas with relatives abroad.

But the fact that the cabin crew would rather see the company go bankrupt than take a change in working conditions, that even their colleagues in Gatwick have accepted (and frankly on the face of it, I can’t see the problem?), begs a fundamental question to me.

The BA staff aren’t living the brand are they?

They clearly don’t feel part of the future of the company or even its present. The cabin crew are the face of the company. They are the front line, the people that we, as customers, deal with. We don’t meet the marketing department, we don’t see the pilot, we see a bit too much of Willie Walsh apologising on TV but we don’t know him, a large part of the way we view the company is based on the check in staff and cabin crew.

Whatever the master plan is, whatever changes are needed in the company, and whatever the final vision is, BA must start communicating it better to their frontline staff before us the customers. If the staff don’t believe then the customers won’t. Striking staff is totally disengaged staff who don’t give a stuff about the consequences.

Here’s a company that needs a huge internal marketing job. We talk a lot about external marketing but internal marketing in an organisation of this size and with significant changes to be made, is essential. If staff don’t understand the change, they won’t support it.

So back to Ryanair. So the seats are rubbish, the staff don’t care, Michael O’Leary doesn’t care, but it’s cheap. I can live with that, it’s refreshingly honest. Where it goes wrong for me, is then ruining that clear approach with hidden charges. Bag charges, credit card charges, mysterious “expenses” lumped in with airport tax and impossibility to check in children online which means an obligatory £8 charge to check in at a desk (each). If your proposition is basic but cheap you actually do need to be cheap. And you need to be honest about the prices. I’m not saying that Ryanair won’t still be a success because they have a monopoly on certain routes and if you want cheaper, you’ll choose them, but I think that the low cost proposition is a clear one and there is just no need to wind up your own customers.

So have you made your decision? I am still debating myself….