Private brands remain strong

M&S wines have won awards

The head of the UK grocery chain Morrisons observes: 'If people are feeling the pinch, they tend to shift out of brands to own [private] brands'. That's why, during the recent recession, private brands marketed by grocery retailers did so very well.

Traditionally, consumers switched to private brands to save money, and then switched back to manufacturers' brands once they felt less anxiety over economic circumstances.

Consumer behaviour these days indicates that despite economic recovery and consumers feeling more confident about spending, private brands continue to sell well. Private brands are helping Lidl--the deep-discount grocery chain--gain market share against traditional UK supermarkets like Tesco, just as they are helping Aldi. 

In fact, customers who can afford to buy manufacturers' brands often choose to buy private brands because they want both value and quality. At Marks & Spencer, for example, the store's brand of wine has won numerous awards, reassuring buyers that the quality is good, not just the price. The newest trend is toward premium private brands, reflecting the dual interest in value and quality.

This post updates the private brand discussion in Chapter 6 of Essential Guide to Marketing Planning 4e.

Unilever and Nestle Pursue Niche Growth

Sweet Earth is being acquired by Nestle

Switzerland-based Nestle is buying a small California firm known for vegan and vegetarian foods; Dutch-British Unilever is buying a company that makes herbal organic teas.

Unilever is acquiring Pukka Herbs

Both of these multinationals are building part of their growth strategies around acquiring businesses and products in niches that are attractive because of increasing consumer appeal and the ability to be noticed through distinctive brands/products.

Unilever, for example, pursued Pukka Herbs because it is unusually fast-growing in its niche. Unilever's top tea executive explains: 'In the morning a lot of people still drink black tea as it picks you up, but in the afternoon or evening herbal tea is wonderful with different benefits'. In other words, Pukka Herbs complements Unilever's existing tea brands and products.

Nestle bought Sweet Earth, a vegan/vegetarian food marketer, to get firmly established in the plant-based protein market. Nestle USA's CEO comments: 'One of Nestlé’s strategic priorities is to build out our portfolio of vegetarian and flexitarian choices in line with modern health trends'.

Mainstream brands/products continue to sell--but certain niches are growing more rapidly and delivering customer acquisition (and profits) through specialization. That's why more multinationals will be exploiting growth opportunities by buying firms that have a following and a strong brand image in a well-defined niche.

Gender neutral marketing?

John Lewis has reignited the debate over gender neutral marketing with its announcement that children's clothing will no longer be categorized as male or female. This isn't a new controversy, but a complex issue confronting retailers, manufacturers and their customers.

What about stereotyping? There is a concern that gendered toys and other products may reinforce stereotypes. Rather than have 'pink' and 'blue' aisles and products, retailers want customers to be able to browse and select products as they choose. But how does this work in everyday brick-and-mortar stores? Will it confuse or even anger some customers?

What about differences between male and female versions of products in a particular category? When customers compare the quality and marketing of boys' and girls' shoe products, for instance, some are unhappy about what they see. Pricing of products is also controversial, with complaints about different prices for men's and women's razors, for example, causing some retailers to eliminate the gender price gap.

At the same time, some marketers are recognizing distinctly different needs amongst male and female consumers, and marketing products geared to needs for each target market. Men in China, for example, are eagerly buying male beauty products like skin-care lotions. L'Oreal and ASOS are marketing makeup products for men in the UK. 

What is the future of gender neutral marketing? The controversy continues.

New regulations drive new auto marketing

The marketing environment can have a profound effect on brand and product marketing. Regulations governing car emissions are a good example.

From today, EU regulators have changed the rules on how car emissions will be measured, to prevent automakers from circumventing emissions limits. Most of all, the new rules are intended to improve air quality, for a greener future. In turn, these new rules are driving new vehicle marketing.

Now automakers are offering 'scrappage' schemes to encourage drivers to purchase new cars and 'scrap' or trade in older vehicles. Volkswagen is offering as much as £7,000 off to encourage UK buyers to turn in their old diesels (registered prior to 2010) and buy a new VW, Audi, Skoda or Seat model.

Ford is offering £2,000 off to UK buyers who exchange any brand of vehicle (model year 2010 or older) for a new Ford model. Kia and Renault are also offering the same amount for older models turned in when buying a new car in the UK. Toyota is offering up to £4,000 to encourage trade-ins of older cars by UK buyers.

Automakers are also designing new cars that will comply with emissions rules and appeal to environmentally-conscious buyers. Aston Martin has plans to have an all-hybrid product portfolio by 2020, and BMW will soon launch an all-electric version of its popular Mini. 

However, the UK's ambitious plan to not allow sales of new diesel and petrol cars from 2040 will strain the infrastructure for electric cars, requiring significant investments in recharging stations, for example. Automakers will be watching the environment carefully as they plan for future product introductions and car promotions.

Luxury Is the Focus of LVMH Branding

http://us.louisvuitton.com/eng-us/stories/tambour-horizon#the-watch

Louis Vuitton Moet Hennessy has a large portfolio of luxury products, including Louis Vuitton (fashion, leather goods and more), Christian Dior (fashion and more), Hennessy (cognac and more), Sephora (beauty retailer) and prestige watch brands such as Hublot and TAG Heuer. In all, LVMH's group annual turnover exceeds €37.6 billion.

Luxury (at prestige prices) is the focus of all LVMH brands. Loyal customers are willing to pay top prices for top-quality designer products that reflect upmarket status and style. Even technology has permeated LVMH's famous product portfolio. Louis Vuitton recently launched a smartwatch that combines the brand's classic fashion sense with Androidwear tech.

Customers worldwide are responding to the luxury appeal of LVMH brands and are following the latest developments in style and function through brand encounters in stores, online and on social media. Louis Vuitton's Facebook page has more than 20 million likes, and its Pinterest boards have 121,000 followers. Its Instagram account has nearly 20,000 followers, and its Twitter feed has nearly 7 million followers. Through posts and viral sharing, LVMH brands expand their reach worldwide and reinforce the luxury positioning that customers perceive.

NOTE: This post updates the "Marketing in Practice" feature in Chapter 7 of Essential Guide to Marketing Planning 4e.

Poundland's multiprice strategy

Poundland has been selling some merchandise for several pounds--expanding its merchandise range and its appeal to bargain-hunting shoppers. Now the retailer, founded in 1990, has a twist on its multiprice strategy: Selling merchandise for less than one pound.

The multiprice strategy helps Poundland keep its brand promise to price-conscious customers. It also helps the retailer manage seasonal inventory. Rather than store out-of-season stock for nine months until the season rolls around again, Poundland is clearing merchandise by cutting the price, as many other stores do. The result: shelves are full of in-season, fresh merchandise at attractively low price points.

Poundland leverages social media for its price-driven promotions, with consistency in posts across platforms. More than 300,000 people have liked Poundland on Facebook, nearly 25,000 follow it on Instagram, and it has 80,000 Twitter followers (as well as a YouTube channel and a Pinterest page).

This updates the "Marketing in Practice" example in Chapter 7 of Essential Guide to Marketing Planning, 4th edn.

Marketing at the intersection of music, pop culture and home decorating

Pantone, known for insights into colour trends, just introduced a new colour of purple, shown above.

The name of the colour is a symbol: Love Symbol #2.

Do you recognise this iconic symbol and colour?

They're closely associated with Prince, whose Purple Rain album was recently reissued with new tracks. In fact, this particular purple was inspired by Prince's customized piano.

Now Pantone, partnering with Prince's estate, has introduced a standard version of Prince's favourite purple.

In marketing terms, this is a smart way to leverage consumer interest in music, pop culture and home decorating. Many consumers who grew up listening to Prince will know his love of purple. Whether they're painting a room or a chair or a piano, they can buy this exact purple.

Now that Prince's unique purple is an official Pantone colour, watch for a variety of new products featuring this colour, for decorating, for gift-giving, and more.

Inside Uniqlo's Marketing Plan

The marketing plan of Uniqlo, based in Japan, targets Millennials and other selected groups through social media and distribution, in particular. The UK branch of this integrated retail empire has 100k Facebook likes, 31k Twitter followers and 70k Instagram (indicating the fashion interest of Instagram users). New products and new stores are featured in social media, along with seasonal favourites and topical messages.

Expanding beyond its home base of Japan, Uniqlo has a growing audience of brand fans in the UK and Europe, China, and the US. Many of Uniqlo's products are fashion basics, although it also launches new style collections seasonally. The company markets own-brand merchandise, and controls the design and production functions as well as controlling the retail outlets. This allows it to move quickly to ride the wave of a strong trend, for flexibility in adjusting the marketing plan as needed.

One recent innovation is the introduction of #UniqloToGo, vending machines dispensing t-shirts and light outerwear in US airports. The idea is to appeal to people passing through airports who need an extra shirt or another jacket to wear to or at their destination. It's not just convenient, it's also a way to increase brand awareness and capture extra sales. The prices are moderate, which encourages impulse purchasing.

This, plus pop-up stores in major cities, allows Uniqlo wider reach and more flexibility in executing its marketing plan.

NOTE: This post updates the Marketing in Practice box in Chapter 8 of Essential Guide to Marketing Planning, 4e

Top UK consumer brands of 2017

SuperBrands has released its list of the top consumer brands for this year, as determined by UK consumers.

Here are the top 5, along with a bit of news about each of these leading consumer brands.

5. Gillette - Gillette is facing competition from UK newcomer Harry's, which offers a subscription-based alternative to buying razor blades at retail. Backed by Procter & Gamble, Gillete's traditional strengths are positive brand recognition and product innovation.

4. Andrex - The well-known toilet-tissue brand is celebrating its 75th anniversary with nostalgia-laden marketing. Andrex enjoys high market share and has slightly shrunk its rolls to cut costs and fund product investments.

3. Rolex - Reinforcing its brand's luxury positioning, Rolex sponsors special events like the Rolex Fastnet yacht race and the Rolex Grand Prix at CHIO Aachen showjumping competition. These special events keep the brand top-of-mind in the target market.

2. LEGO - The recent Bricklive special event in Belfast offered LEGO fans the opportunity to build and to watch others build creatively. More than 10,000 brand fans showed up, some to build and many to enjoy seeing the process and the finished results--reinforcing loyalty and engaging fans.

1. British Airways - As part of a trend toward entertaining passengers (and the public), BA recently released a funny safety video starring celebs like Gordon Ramsay, 'Mister Bean' (Rowan Atkinson) and Gillian Anderson. The airline's CEO says he wants passengers to watch the safety video from start to finish. It's also a positive branding association.

What's New at Cadbury Dairy Milk?

After a period of outsourcing production of Dairy Milk beyond the UK borders, Cadbury has announced that the popular chocolate will once again be "made in Britain" at the Bournville production plant.

Cadbury is also bringing back a product that twice was deleted from the range due to low sales. The Dairy Milk Tiffin chocolate bar, originally launched 80 years ago, is returning to store shelves permanently following a highly successful limited-edition version in 2016.

Not new: the company still offers personalised Dairy Milk bars. Increasingly important: Cadbury UK's popular Facebook page (more than 700k followers), active Twitter account (more than 300k followers) and Instagram account (146k followers). That's how Cadbury's social media marketing strategy keeps its brand and products in front of Millennials who enjoy chocolate.