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.

Changes in Nespresso's marketing environment

The marketing environment is changing for Nespresso. A division of Nestlé, Nespresso pioneered the high-quality, single-serve coffee/espresso machine in 1986 and remains a market leader.

In recent years, however, Nespresso has faced increased competition as well as regulatory pressure in many markets. One reason is the high profitability of replacement single-serve coffee capsules. The way razors require replacement blades, Nespresso machines require replacement coffee capsules. That means opportunity for Nespresso and for rivals, who have been making capsules to fit Nespresso machines.

Following a legal battle in France, Nespresso will now share technical information about its machines so rivals can make completely compatible replacement capsules. It won't threaten to invalidate warranties if customers use rivals' capsules, either.

Thanks to years of carefully-crafted marketing, Nespresso has successfully encouraged millions of espresso-lovers to visit its boutiques or order online when they need replacement capsules. Price-conscious buyers are most likely to switch to rival capsules. The changes in its marketing environment are unlikely to woo away the most brand-loyal customers, "club" members who enjoy the coffee and the entire buying/consumption experience.

Nespresso says that half of its new club members are introduced to the brand by friends and family--among the most trusted word-of-mouth sources. Having George Clooney as the brand's spokesperson is another competitive advantage. In Japan, however, Nespresso has a new marketing gimmick: friendly robots equipped to converse with customers about their java preferences. Not only will the robots engage customers and prospects, they'll capture conversational content that Nespresso can analyse for clues to needs, behaviours and buying intentions.

Browser competition

Finally, after a decade, Microsoft has settled EU antitrust charges by allowing Windows users to choose which Internet browser they want to use. This agreement with regulators is important because it's intended to prevent Microsoft's Internet Explorer from having an unfair advantage over competitors.

By early 2010, PC owners who use Windows will see a screen asking them to choose from among as many as 12 browser options: Apple's Safari, Google’s Chrome, Microsoft's Internet Explorer, Mozilla's Firefox, Opera, AOL, Maxthon, K-Meleon, Flock, Avant Browser, Sleipnir and Slim Browser.

Already, Mozilla's Firefox browser has captured about 32% of the market for Web browsers, and Opera--which filed an EU antitrust complaint in 2007--has about 2%. Google's Chrome is approaching 4% market share. Once Windows users start making their choices, watch for dramatic changes in market share by mid-2010.