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Marketing Horizons Newsletter November 2003
Real Life Examples
Emeril Lagasse pitches toothpaste
Topics: Celebrity endorsement, Product Differentiation
Procter & Gamble recently announced an $80 million marketing campaign for a
new line of whitening toothpastes with names like Cinnamon Rush, Extreme Herbal
Mint, and Fresh Citrus Breeze. The company’s new pitchman is popular TV chef Emeril
Lagasse.
In the commercials, Lagasse will be seen happily brushing his teeth with the new
spicy flavours while interjecting his “bam” and “kick it up a notch” stock phrases. It’s
debatable whether consumers can get over the yuck factor, i.e. that combining
toothpaste and food is inherently unappealing. Only time will tell whether Emeril
Lagasse is the right celebrity choice for the product.
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Question to Ponder
1) Do you think Emeril Lagasse is an appropriate choice to pitch toothpaste? If not,
who would you recommend that Procter and Gamble use?
Luxury Cars for a Select Few
Topics: Prestige brands, Positioning, Price quality relationship
When customers walk into one of the three Aston Martin dealerships in Canada,
they rarely need a hard sell. In fact, most don’t mind paying up to $360,000 for the
British “super car” they have dreamed about since iconic spy James Bond made it
famous.
The number of vehicles with a price tag over $100,000 isn’t just restricted to
the Ferraris, Mercedes, and Aston Martins of the world anymore. BMW and Jaguar,
for example, are offering “ultra luxe” fair these days and even former luxury standard
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bearer Cadillac is trying to get a spot in this market with its new two-seater XLR
roadster, that will retail for about $110,000.
Cadillac has seen some tough times in the last decade as core buyers died off
and younger prospects shirked the brand. In fact, Cadillac held the title as top luxury
brand for more than fifty years until Lincoln overtook it in 1998. By 2000, Cadillac
ranked behind Lexus, Mercedes, BMW, and Lincoln.
Question to Ponder
1. Do you think Cadillac will ever regain its title as top luxury brand?
Perhaps sex doesn’t sell after all
Topics: Advertising appeals, Brand recognition, Criticisms of advertising
Reactorz, a Toronto research company, tested brand recognition of sexually
provocative clothing ads such as Calvin Klein, Buffalo and Parasuco. Teens showed some
brand recognition but more interesting were their comments. The teens in the sample
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considered themselves to be very media-savvy. They understood that sex sells but
they didn’t think they were influenced by the advertising. They felt they saw through
it for what it was, a manipulative advertising technique that worked on everyone else.
They liked some of the clothes and they prided themselves in being able to admire the
clothes despite the offensive advertising.
Questions to Ponder
1) Comment on the teens’ statement “they understood sex sells, but they didn’t
think they were influenced by it.” Do you think they are being honest or perhaps
a bit naïve?
Tweens Reflect Parents’ Purchasing Behaviour
Topics: Consumer Behaviour, Trends, Market Segmentation
Today’s tweens are spending as much on their bedrooms as some Canadians do on a
down payment for a new home. Sophisticated 8-13 year olds are in the market for art4
deco bedroom suites, French linen and faux finishes. Encouraging every purchase is
not an enterprising interior decorator, but moms and dads who are prepared to sign for
it all. According to the NPD Group, a market research firm, female tweens spend
$700 million a year on retail items, more than double that of boys the same age.
According to Carolyn Offman, a buyer from the Art Shoppe, an upscale furniture
Store , tweens' purchasing power is being handed down by their parents who are
competitive in how they dress and this crosses over to furnishings and design. She
says kids pick up on this and emulate the adults around them. Ms. Offman is seeing
young Art Shoppe customers with more say and spending power than previous
generations.
Question to Ponder
1) According to the above article, female tweens spend more than double that of
boys. Can you think of reasons for the difference?
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GM’s Race to the Future
Topics: Product Differentiation, Innovation, Product Life Cycle
General Motors has already spent $1 billion in developing a hydrogen-fueled car
that it hopes to begin manufacturing within a decade. The GM hydrogen car has come
to be embraced as a way to regain a technological lead fumbled away decades ago, and
to create an almost unimaginably vast new market. This car, GM’s top executives now
believe, will be so different that it could set in motion a complete turnover of the
world’s 700 million cars.
The biggest stumbling block for GM may be to convince the oil companies to get
involved in producing hydrogen and having it available at service centres.
Question to Ponder
1) GM failed when it pulled the plug on its vision of battery-powered cars. Do you
think it will be more successful with hydrogen?
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Hotspots are Hot
Topics: Technology, Trends
Wireless net access spots or hotspots, as they are called, are becoming popular.
Hotspots are public access points that use the Wi-Fi network protocol to deliver
Internet access.
This summer, Via Rail became the first rail company in North America to deliver
wireless Internet access on its trains. The pilot project, which currently only covers
first-class passengers traveling between Montreal and Toronto, is run by Bell Canada.
McDonald’s Canada also joined the parade, announcing that by Christmas it intends to
have wireless access in ten restaurants. Buy $3 worth of McDonald’s products and get
forty-five minutes of wireless connectivity.
Question to Ponder
1) Do you think that “hotspots” in restaurants can be a motivator for consumers to
consider one over the other?
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Something To Think About
Marketing Trivia Quiz
(Answers at the end of the quiz)
1. According to Microsoft Canada, what percentage of Canadian homes have
PCs?
a)
b)
c)
d)
e)
50
60
70
80
90
2. Imported beer accounts for what percentage of the Canadian beer market?
a)
b)
c)
d)
e)
5
10
15
20
25
3. How many years elapsed between the time the idea for Minute Rice was
conceived and the time it was finally marketed?
a)
b)
c)
d)
3
6
9
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4. What are the five most popular Campbell Soups?
a) Cream of spinach, cream of chicken, vegetable, tomato, chicken noodle
b) Cream of broccoli, cream of chicken, vegetable, tomato, chicken noodle
c) Cream of mushroom, cream of chicken, vegetable, tomato, chicken
noodle
d) Cream of vegetable, cream of chicken, vegetable, tomato, chicken
noodle
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5. True or False: Smirnoff is a Russian-made vodka.
a) True
b) False
6. Can a producer of acetylsalicylic acid in the U.S other than Bayer call its
product aspirin?
a) Yes
b) No
The Correct Answers Are:
1) c
2) b
3) d
4) c
5) False: Smirnoff is made in the United States and the head office is in Hartford,
Connecticut.
6) a) Yes: Bayer did not protect its trade name in the US and the generic name
aspirin is used on bottles of acetylsalicylic acid tablets. In Canada, Bayer
Aspirin is the only ASA tablet permitted to carry that protected trademark.
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Something To Think About
Origins of the Swoosh
It is one of the most recognized symbols in the world, the Nike Swoosh. What most
people don’t know is how it originated. In 1971, Phil Knight, the founder of Nike was
supplementing his income by teaching an accounting class at Portland State University.
There he met Carolyn Davidson, a graphic design student. Knight offered to pay her a
couple of dollars an hour if she would do some design work for his small company.
Specifically, Knight asked her to design a logo that could be placed on the side of the
shoe. She handed him the Swoosh, and submitted her bill for $35.
The Swoosh creator was recognized for her work in 1983 when Knight presented her
with a gold Swoosh ring embedded with a diamond. She also received a certificate
from Knight and an envelope containing Nike stock. How much stock remains a secret
between her and Knight.
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Marketing Magazine Articles
Below you will find two interesting articles from Marketing magazine. At the end of
each article I have added some questions for your students to ponder.
November 10, 2003
Specialty is Our Specialty
By Janet Eastwood
Alliance Atlantis reveals the secrets of successful television marketing
At last check television viewing was on the rise in Canada, with viewers spending upwards of 28
hours per week in front of the tube. In fact, channels like Showcase and HGTV are growing in leaps
and bounds, boasting year-over-year audience growth of 24% and 31%, respectively. So, one could
argue that television marketers can take a break, sit back, revel in the success and concede that their
job here is done.
Well, they could, but I wouldn't recommend it. Although audiences are growing, the television
industry is more competitive now than at any other time in its history. New channels, new programs
and new multimedia options are all competing for share of eyeballs, making it more important than
ever that broadcasters market effectively if they hope to break through the clutter of our media11
saturated universe.
So what are the secrets to successful television marketing? Well, in my opinion, succeeding in
marketing is a little bit like succeeding in the Olympics. A winning performance requires focus,
discipline, structure and a large dose of passion.
Any marketer knows that focus is the key to developing a strong brand. But focus also extends to the
way in which you run your business. At Alliance Atlantis Broadcasting, specialty is our specialty. So,
while some broadcasters are focused on other things, and treat specialty as a bit of an afterthought,
we devote 100% of our time, energy and resources to the business of specialty television. And with
good reason-specialty television is quickly overtaking conventional television in both audience
numbers and advertising revenue growth.
In fact, over the last five years there is a consistent trend that has witnessed the share of hours tuned
to Canadian conventional channels declining, while the share of hours tuned to Canadian specialty
channels continues to grow. Since 1998, Canadian specialty television's share of hours tuned has
increased to 26% from 19%, while Canadian conventional channels have seen their share decline to
36% from 45%, according to Nielsen Media data. Alliance Atlantis Broadcasting is committed to
leading this trend towards specialty.
The next element in a winning marketing formula is discipline. Every broadcaster works hard to
promote its channels, but the television industry is a wild and opportunistic marketplace that is not
renowned for its discipline. At Alliance Atlantis, we take a strict, packaged goods approach to the
marketing of our networks. So, whether it be an established brand that we acquire for the Canadian
market (HGTV, National Geographic Channel, BBC Canada) or a home-grown brand that we
conceive of and introduce (Showcase, History Television, Showcase Action), we spend a great deal
of time in research, development and design to ensure we unveil distinct, highly targeted brands that
will resonate with our viewers. Once a channel is launched, we continue to track,
research, refine and hone the brand until it is truly a market leader.
Another aspect of our approach that is integral to our success, yet differs slightly from the industry
norm, is the structure of our marketing team. Unlike most broadcasters, all of the marketing
disciplines-including consumer trade and affiliate marketing for all 12 specialty channels-are
consolidated into one team. Marketing planning, advertising, on-air promotion, media relations,
viewer relations and affiliate relations work hand-in-hand in one integrated brand-building unit. This
group also works closely with our external ad agency, FCB, to ensure that on-air and off-air creative
is developed synergistically under a common strategy.
The marketing, communications and creative services department forms part of a larger multidepartmental "brand team," which is made up of many other key stakeholders including
programming and sales. This group works closely together to identify and exploit opportunities that
will drive audiences and increase sales. Our close and collaborative relationship with our
programming and sales teams is a critical factor in our success. Without strong programming, all of
our marketing efforts would be in vain. And without a strong sales team, our audience growth would
never translate into revenue.
But the key ingredient in a winning marketing formula is passion. We love what we do and we are
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absolutely committed to being at the vanguard of TV marketing. In planning major campaigns, we
always challenge ourselves to build in some element or tactic that we have never tried before.
Whether it is sending funereal wreaths and condolence cards to media agencies expressing remorse
for the fact that media plans would now have to be reworked to include our newest acquisition, Six
Feet Under, or sending street teams out with TVs on their backs to gain attention for the launch of
Curb Your Enthusiasm, we are constantly seeking ways to generate added buzz for our properties.
The most recent example, which hit the street in late August, was the Six Feet Under mobile. The
vehicle, a custom-built glass cube truck filled with soil and topped with grass and flowers, was
outfitted with 52-inch plasma flat screen televisions buried six feet down into the soil. The televisions
aired clips and promos of the show and drove through high traffic areas in Toronto.
Do these unorthodox tactics actually help drive audiences? It seems so. The premiere of Six Feet
Under drew a record-breaking 735,000 viewers, making it the highest-rated series on specialty (based
on a single-play average of the first five airings).
But marketing expertise will only go so far if it is not combined with a true, gut-felt passion for
excellence. I believe that this is the real secret to any success. It is a passion for what we do that
drives us to take each campaign to the next level, to push the boundaries of the tried and true, and to
achieve new heights of marketing sizzle.
JANET EASTWOOD is executive vice-president, marketing, communications and creative services
for Alliance Atlantis Broadcasting in Toronto.
Question to Ponder:
What are the key ingredients in Alliance Atlantis’s successful television marketing?
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November 10, 2003
Red, white and red, eh
By Elliott Ettenberg
Despite the similarities, there are big differences in the marketing cultures of Canada and the
U.S.
Having worked the past eight years in the U.S., the question I get asked most often by friends and
colleagues is whether there is a significant difference in the marketing cultures of the two countries.
After all, it's mostly the same language, the same companies, the same brands and the same
marketing.
So why is it that most of my U.S. and international clients assume I am American when we first
meet? Come to think of it, why do most of my Canadian clients think I'm American? I've written
about the perceived differences between these two cultures in the past. Now that I've spent the better
part of a decade in New York, I can tell you for the most part, my thinking was correct.
First of all: We are Fort people; They are Homesteaders.
Don't be fooled by similarities. It's the differences that make the difference (sounds like Yogi Berra,
eh). Canada was settled by the Hudson's Bay Company. They populated our country with people who
wanted the security and the safety of living in a fort. They sought immigrants who were escaping
poverty to build a family and a future in an environment where HBC controlled what they did and
how much they got paid.
Down south, it was very different. When the government opened up the country and the land grab
was on, folks got together, hired a guide and went west. They then took the land, built a homestead,
defended it until it was reasonably safe, brought in friends and family, elected a person to enforce the
laws they chose to live by and killed a lot of people along the way.
Right from the beginning, these two great lands were different. The BNA Act promised Canadians
law, order and good government. All things necessary for a civilized Fort nation to grow. Prosperity
came to few. Most did the work and made a living. But there never was a promise of riches.
The American Constitution promised life, liberty and the pursuit of happiness. All things necessary
for an entrepreneurial Homesteader to succeed. Can you imagine a Canadian Constitution with
"pursuit of happiness" institutionalized within it?
We chose a rodent for our national animal. They chose an eagle. We strive to fit in. They live to stand
out. They value leadership, insight and action. We prize collaboration, consensus and compromise.
That's why we tag every strong opinion with the word "eh." "Eh" is a way for Canadians to make an
American statement while seeking peer approval. There's a world of difference between: "He stinks
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as a writer" and "He stinks as a writer, eh?" The first is a statement of condemnation. The second an
opinion seeking confirmation.
Yes, Virginia, there is one hell of a big difference between management styles. I find it much easier
to deal with American managers for a number of reasons. The most important is their motivation to
win. This means they are always looking for a competitive advantage. Which means it's much easier
to get to meet a senior manager in the U.S. than it is here in Canada. In the U.S., there's almost a fearcertainly a deep respect-for the leverage intellectual property can generate. Presenting new ideas and
getting funded is so much easier.
In Canada, there is a constant fear of change. There's a predictability to Canadian business which
borders on boredom. Perhaps this is why so many Canadian companies fail in the U.S. Their fear of
American gun slinging in business, characterized by quick decisions, little collaboration and full
commitment of resources, scares the hell out of most Canadian managers. Their answer: control
every single aspect of the expense line and hold them to their revenue projections. It doesn't work,
hasn't worked and never will work.
Of course, all this will change going forward. Health care will become the strategic battleground in
this decade. The first party to provide sensible health care coverage for retiring boomers will
dominate Congress and the White House. In so doing, they will move closer to the Canadian model.
Likewise, the immigration patterns for Canada are significantly shifting. Between 1998 and 2000,
Asian and Pacific regions accounted for 55% of immigration. A more industrious, entrepreneurial
business community is quietly developing here-one that increasingly will move our managerial
culture closer to our friends to the South.
Before you all take computer-in-finger and point at Enron, Arthur Andersen et al., let me say that,
yes, the American system has a built-in motivation for pushing the limits in both compensation and
business ethics. But despite all the warts and pimples, those of us who cherish fresh thinking, decisive
decisions and a belief in their vision are more comfortable within the American system than what we
have going here.
Some of us have figured it all out. We have the best of both worlds. We work in America, but live in
Canada. Not bad, eh?
ELLIOTT ETTENBERG is chair and CEO of Ettenberg & Company, a marketing consultancy based
in Glen Sutton, Que. and Sarasota, Fla
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Question to Ponder:
The author comments about the differences between Americans and Canadians. Do you
agree with these specific comments?
(1) We strive to fit in. They live to stand out.
(2) They value leadership, insight and action. We prize collaboration, consensus, and
compromise.
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