Thursday, 8 December 2016

Is Amazon Go the future of grocery shopping?

When the pioneer of online retailing tests a new store concept, the world of retailing pays attention. Amazon Go is the prototype unit of a US chain of small grocery stores, intended to serve shoppers who want a quick and convenient place to buy frequently-purchased items like milk or freshly-made sandwiches.

What makes this a unique concept is -- as shown above in a still from Amazon's video introduction -- shoppers don't queue to pay at the till. No, seriously, their purchases are tallied on a smartphone app and recorded as they leave the store. Amazon charges the payment method on file for each customer and sends an electronic receipt.

Obviously, only shoppers with smartphones can shop at Amazon Go. But given the mature nature of the smartphone market, this is not much of a barrier. And given the high brand awareness that Amazon enjoys, consumers are likely to at least give this store a go if one opens nearby. Because, it seems, there are some products that simply can't be sold online and some shoppers who simply won't buy groceries online (consumer behaviour in action).

Behind the scenes is Amazon's technology, sensing when a product is lifted from a shelf (and if the product is returned to a shelf). Amazon is a master of inventory management, and with time it will learn what sells and doesn't sell in each store location. No cashiers, an enormous cost savings. And the opportunity to serve the same shopper again and again because groceries are a frequently-purchased product category. Is this the future of grocery shopping?

Thursday, 1 December 2016

What's new in chocolate marketing?

Chocolate for the holidays . . . chocolate as an everyday affordable luxury . . . chocolate as a socially-responsible snack. These are some of the ways that chocolate marketers position their products. The world of chocolate marketing is changing, thanks to changes in technology, consumer behaviour and society.

  • Nestlé announced today that it has discovered a scientific way to reduce the amount of sugar in a chocolate bar without sacrificing taste. The company has been trying to reformulate its products to reduce levels of sugar. With obesity a concern in many nations, marketing chocolate with lower sugar could make products like Nestlé's KitKat bars more appealing to a wider market. 
  • Toblerone, made by Mondelez International, recently changed two of its chocolate bars to reduce the weight, in response to higher ingredient costs. Most if not all chocolate marketers are experiencing higher costs, which some can absorb for months and others must pass along in the form of higher prices or reduced-size products. 
  • Consumers are often interested in where a product's ingredients come from, seeking out ethically-sourced chocolate from companies that have a social responsibility agenda. 'Single-origin' chocolate is sourced from one area, ideally from one group of cocoa growers who receive fair-market pay for their crops. Single-origin chocolate also reflects the distinctive flavour of its beans. Waitrose, for example, is marketing chocolate bars from specific sources, each with its own flavour. 

  • Hotel Chocolat was a leader in single-origin chocolate, a first-mover advantage in mystique that has helped build its brand. Now Hotel Chocolat, which has a chain of branded shops, is continuing its growth by opening cafés where customers can experience its chocolates in a branded restaurant-style setting.
Some of these trends are discussed in the updated sample marketing plan for the fictional company Lost Legends Luxury Chocolatier, when my next edition of the Essential Guide to Marketing Planning is published in 2017.

Monday, 28 November 2016

Branded salt and GivingTuesday

No, salt is not just salt. In the age of marketing, Morton Salt, a US-based brand, has the advantage of longevity and consistency. It also has a salt product for nearly every consumer and business segment.

For many decades, its packaging and adverts have featured the 'Morton Salt girl' holding an umbrella (see below, from Morton's website).

And now the salt brand is 'giving back' by backing a campaign designed to encourage charitable donations on #GivingTuesday, the last Tuesday in November.

Morton Salt partnered with an indie band, OK Go, known for its 2014 song, The One Moment, to create the video with eye-catching visual moments.

The salt company had the idea of inspiring giving through this video, to reinforce the brand's commitment to marketing purpose.

According to the director of communications and corporate brand strategy:
'We were really looking to help break through in a way that people would not necessarily expect from Morton Salt'.

Thursday, 24 November 2016

Writing a marketing plan? Check newly updated links

If you're preparing a marketing plan, you may find some valuable ideas amongst the 80+ hotlinks here on my blog. The list is now updated with additional sources of marketing news and links to marketing resources around the world. 
  • For marketing plan templates and tips, be sure to check the CIM Marketing Expert page.
  • For an overview of the main components of a marketing plan, visit NI Business Info.
  • For more detail about writing a marketing plan and planning for social media, visit Business Victoria.
Just as important as your marketing choices: Plan ahead for metrics to measure results to evaluate the outcome of each marketing programme.

Friday, 18 November 2016

Most Valuable Global Brands in 2016

Interbrand recently ranked the most valuable brands in the world. For 2016, the top 10 list is:

10. General Electric (US based)
9.   Mercedes (Germany)
8.   Amazon (US)
7.   Samsung (South Korea)
6.   IBM (US)
5.   Toyota (Japan)
4.   Microsoft (US)
3.   Coca-Cola (US)
2.   Google (US)
1.   Apple (US)

Notice any patterns?

First, 7 of the top 10 are US-based brands.

Second, technology fuels many of the top 10. 

And third, these are powerful brands backed by powerful marketing. Coca-Cola is well over a century old, yet it remains highly popular and valuable because marketing keeps it visible in pop culture. Amazon was incorporated only 20 years ago, but its first-mover advantage and ongoing innovations have helped the retailer stay ahead of competitors year after year.

Will Apple remain at the top of the tree in 2017? Although some analysts are concerned about Apple's ability to keep innovating, the brand has actually increased in value. I believe it won't lose its #1 status in 2017. But Samsung may fall in the rankings as a result of its exploding battery problem.

Tuesday, 15 November 2016

Introducing Christmas 2016 adverts (and their hashtags)

In the coming days, you'll see more and more of this year's Christmas adverts on every screen (telly, tablet, mobile). Building anticipation is part of the fun and a smart marketing strategy too.

Here are links to just three of the recently introduced retailer adverts playing on screens across the UK.
  • Aldi's advert features #KevinTheCarrot (above) and ends with the strapline 'everyday amazing' to reinforce the retailer's low-price positioning. One million online views in one week.
  • The new John Lewis #BusterTheBoxer advert has been viewed 15 million times on YouTube in just the first four days. Not only is Buster an adorable toy, 10% of the price goes to charity.
  • Marks & Spencer features Mrs Claus in #LoveMrsClaus, its 2016 holiday advert. In four days, this advert has been viewed online 4.6 million times.
Watch for the hashtags integrating mentions of the adverts throughout social media and traditional advertising.

Monday, 7 November 2016

Competing with Aldi

Aldi, the deep-discount grocery chain based in Germany, is known for low prices on brand names and on non-branded merchandise. In fact, Aldi offers a Shop Specialbuys app to alert shoppers when their favourite products are going on sale (get ready to 'swipe and shop').

A former exec who helped set up Aldi in Australia explains the retailer's strategy: '. . . the deal between the supplier and Aldi is; first Aldi will take a larger pack size, often a pack size that is exclusive to Aldi so some economy is represented here and that Aldi does not embarrass other bigger retail customers . . . of the brand with its selling price'.

Now Aldi's head in Australia notes how the company's expansion has affected retail pricing: 'Our prices are always the lowest, so we have observed the market getting a little sharper in prices … at the same time as our competitors have been lowering prices, we have as well'. Aldi's expects to continue acquiring market share in Australia, aiming for as much as 15% of that market within a few years.

One way competitors are fighting back is by not only increasing their private brands but in some cases, by blurring the line between national brands and private brands. Woolworths in Australia recently relaunched some of its store private brands without highlighting the retailer's brand ownership on the front label. Products formerly branded prominently as 'Woolworth's Gold' now bear the brand 'Gold' on the front label, for example, with the Woolworth name on the back label.

Woolworth says it has been fine-tuning its Australian private brands: 'Over the last year we sought insights from our customers as we looked to enhance our range of products. Woolworths branded and non-branded ranges reflect our commitment to quality and value'.

Meanwhile, Aldi's low-price grocery rival in Germany, Lidl, is moving further into markets where Aldi has established itself--such as the US market. 'We are in the early stages of our preparation to launch in the U.S., and our focus right now is in our operations along the East Coast and opening our first stores no later than 2018', says a Lidl exec. Lidl competes against Aldi by opening larger stores and stocking a wider assortment of merchandise compared with Aldi.

Watch for price wars when Aldi targets a market--and watch for competing stores to slash prices or risk losing shoppers who follow the bargains.