Category Archives: Advertising

When people enter a BMW (replace with your favorite car) showroom, what are they looking for? Are they looking for a car with a great performance and cool interior? Or a car with 5 years/40,000 miles warranty? Or something else? Well I think both, a great car and a top notch service, but that’s not all. Most of the time they are also looking to buy the experience, the experience of owning and driving this car. Many times, great product and service just do not make it lucrative enough for the customer, and that’s where experience kicks in. In a market where there are many choices available, you need to differentiate your offering from the competitors’, and one way to do that is by hooking an experience with your offering.

So what is this marketing experience? You can think of this as just another form of de-commoditization. It’s like you are still selling a product coupled with service, but you are packaging it as something more. Something virtual that adds value to your offering. There are several ways of marketing experience. One way is to attach a story to the product, something that the prospective customer can connect with. By doing this, the product creates a special place for itself in the hearts and minds of the customers, and when they finally go to buy it, they are buying that experience.

Yet another way is by adding a vibe to it, like in case of Trader Joe’s: a classic example of marketing experience. People shop at Trader Joe’s because they trust the quality of products they get at this place and they experience shopping at Trader Joe’s as shopping at a local store, a store that does not have that big chain kind of feeling. So here we are talking about a company with about 300 stores nationwide, a chain enterprise with the highest sales per square foot numbers (about $1300 to $1400, compared to industry average of $400 to $500) in its class and yet creating an experience of the local grocery store, which forms the base for its success. And to make it more firm, here’s the tagline of Trader Joe’s: Your Neighborhood Grocery Store. That’s what is marketing experience at its best.

Marketing Experience goes even further. Companies sell experience of working at their company to prospective employees. Business schools attract top talent by selling experience of studying and networking at their schools. The army and the marines sell the experience to get the best of the best to join the forces. Politicians sell a dream of an experience, an experience of a better tomorrow, to buy the votes. The list goes on and on.

The basic strategy is to put the product aside and concentrate on marketing the experience. The experience that can be only filled when your product comes in picture. If you are successful enough to make customers look for that experience, your product will automatically sell.

Recently I saw online banner ads for Buy.com that said: 10% off Amazon.com on over 900,000 books. This made me wonder why the banner is not saying: get books for 10% less than at any online bookstore. By referring to Amazon.com in their advertisement, Buy.com is doing two major mistakes. First, they are doing some free advertisement for Amazon.com and acknowledging it as the leading bookstore online. Second, it is loosing its own identity as a bookstore. What is the unique reason someone should go to Buy.com? Because it has 900,000 books (which may not cover the entire long tail) that are also at Amazon.com but 10% cheaper. If there were only 2 online bookstores, this ad would have made a little more sense, but when there are a zillion out there, and you want price to be your USP, why not say any online bookstore and gain an identity that we sell books at cheapest rate?

Another example that falls in this category is the commercial of Hyundai Azera, where the comparison is made to Lexus LS460. Hyundai can claim that it is a smart move to compare its model with a car far more popular and expensive, and provoke the customer to think why not buy a car more economical when it has all the same features except a fancy one. But to look at the flip side of the coin, the commercial does a huge favor for Lexus. Any customer will have a natural instinct to explore and find out what else is there is LS460 that makes it more expensive, and I can bet that a Lexus sales person will be able to point many if you ask him/her. I think the Hyundai commercial also makes a statement about the buyer of this car. Isn’t it saying that this person is driving an Azera because he could not (or may be would not) afford a Lexus LS460?

Many companies use this kind of advertising strategy where they explicitly mention the name of a competitor in their advertisements. I think just by comparing, the brand exposes a natural inferiority about its own product. But, if for some reason, you find a necessity to compare on a mass scale like in an advertisement, it’s always better to generalize the comparison without naming any other company.

One thing to make clear is that finger-pointing comparison has nothing to do with modestly acknowledging that you are not at the number one position. There are far better ways to do that. The first example that comes to mind is Avis. The car rental company so wonderfully campaigned saying: we are number 2: so we try harder. Yes, they are comparing here, but no one knows just from this statement with whom. And as Avis gained market share, they kicked out the “we are number 2” part, making its tagline “We try harder”.

To summarize, we all know that comparison is inevitable, and in most cases, customer will do the comparison before making a buying decision. If as a brand you want to force the comparison, do it in a way that it benefits more to you than to your competitors and make sure there is no chance of backfiring.

Have you ever been at a place where you feel an overflow of positive energy? Some place where you feel excited, happy and energized? What is your reaction to that? Most of the time, you enjoy that experience, and depending on what it is, you may want to have a repeat experience of it. That’s what a positive vibe is and in a World where a customer is exposed to a lot of options, it is something that can make all the difference.

Positive vibe is one of the biggest differentiators. It makes a difference in a lot of things from a simple television advertisement spot to grocery shopping to workplace environment to almost anything you can think about. In case of advertisements, positive vibe plays a role in generating a desire to have the product. The best examples that come to my mind are the Porsche commercial (long version) or the iPhone ad. These advertisements make you chuckle. Why? Because the advertisement creates a good feeling about the product. A thought that says, may be (in case of Porsche, “one day”;-)) I should buy this product. That’s a unique feeling that makes the commercial stand out because you don’t get the same feeling while watching the other dozen car and cell phone commercials. 

Another explicit case where positive vibe directly converts in dollars is shopping centers. Whether it is grocery shopping or shopping for a furniture, the positive vibe makes the customer feel comfortable to spend more time and money at the store. Some examples that pop into mind while thinking about the happy and energized atmosphere at shopping places are Trader Joe’s and Whole Foods. These stores make the customer feel at home while shopping. The staff exemplifies a feeling of happiness increasing the footfall in these stores and the number of return customers.

There are places where positive vibe doesn’t make a that straight forward difference, but it can still be instrumental in many ways. For example, consider schools. Schools are there to provide education to the students. If schools can develop a positive vibe, the learning experience can become even better for students. Students should not feel going to school as a burden or necessity. They should rather be thrilled and excited to be at school. In order to do that, the students should feel welcome, energized and happy at the school. This will encourage students to spend more time and energy at what they do at school. This will improve their preformance of what they do, irrespective of whether it is learning math and science, or excelling in sports.

The vibe does make a difference. Sometimes big, sometimes small. This makes me wonder why are there shops where it is not there. Why are there ads that don’t make you excited about a product or an online store where you don’t feel like buying something? This raises the obvious question: is positive vibe something can be created? Yes, I think it can be. In fact it should be. It should be in your list of required features you want to be there. At the end, it’s all about creativity. If you can pump in some creativity in order to make the place or product more attractive, with the explicit thought in mind to bring in the feel good factor, you can generate this critical differentiating factor.

Guerilla Marketing, the unconventional way of performing promotional activities, has long been used by small businesses to market their products (and services). But recently, more and more big companies are resorting to this tactic for marketing and advertising their products. This new trend of big companies being attracted towards Guerilla marketing highlights some issues of concern with traditional advertising mediums and some major benefits of Guerilla marketing.

I think the stickiness factor of advertising is one of the most important reasons why companies are looking for alternative ways of product promotion. Due to the developments in information technology, the mediums to which a customer is exposed to has risen dramatically. On an average, a typical individual has access to more than 50 television channels and a dozen radio stations. Along with this there are tens of magazines coming out every month and millions of websites on Internet. This has risen the number of advertisments the customer is exposed to, reducing drastically the stickiness of the messages. Guerilla marketing may look like a rescue for advertisers to attract the customers, or even a boon if the size of budget involved in the effort is comparitively small.

I think budget, though a very big factor, doesn’t seem to be the only factor. Companies with hundreds of millions in marketing budget are also resorting to Guerilla marketing efforts. Guerilla maketing is pulling companies towards itself because it is one of the most targeted way of marketing products. Take for example Red Bull, the highly caffeinated energy drink. Red Bull is one of the companies with the most unconventional advertising strategies in the World. Some Guerilla efforts that made Red Bull the most popular sports drink in the World are organizing extreme events from cliff diving in Hawaii to skateboarding in San Fransisco to support atheletes who compete in these sports and attract a very targeted customer base. Red Bull also conduct a slew of not so typical promotional activities to make it a staple at hip bars around the World including creating student brand managers and consumer educators (read more about Red Bull marketing in Sep 2001 issue of Fast Company)

Another important advantage of some of the bigger Guerilla marketing efforts is the free media attension earned by the companies. Guerilla marketing does miracles in creating a buzz and start people talking about the brand. Consider the KFC campaign to become the first logo visible from outer space right when online firms were investing millions in publishing arial images of the earth. The campaign created more buzz for KFC than any other promotional activity for any fast food company. This also clears a misconception that all Guerilla marketing efforts you see out there are on small budgets. It took more than 50 engineers, designers, architects and other professionals working nearly 3 months round the clock to create the World’s largest logo.

Talking more about the budget, Guerilla marketing normally has the advantage of smaller budget than running campaigns on traditional mediums. One of the more recent successes of Guerilla merketing is the launch of Mini by BMW in the US for a budget of about $13 million. How did BMW pull this successfully in a country where every third advertisement on any conventional advertising medium is of a car? By deploying some great Guerilla marketing tactics.

Guerilla marketing broadens, or we can say removes, the limits of creativity in the space of marketing and advertising. Companies irrespective of their size, products and marketing budgets can use Guerilla marketing to promote their products. And when elephants dance well to the tunes of Guerilla, it readily attracts the customers’ attension and keeps the cash register ringing!

Customers are always looking for differentiating factors between different products and services available in the market. In many industries today, like insurance, car rentals and personal computers, the products are getting more and more standardized. They have the same look and feel, similar terms and conditions and in most cases, the same price tag. In such industries, to locate a differentiating factor is very difficult. Some factors which were previously not taken that seriously can now play a more important role in affecting the customers’ buying decision. One of such factors is customer service.

Customer service has always been a very important factor to ensure long term success in any industry. But normally, customer service is something that comes under the radar when something goes wrong with the product, or in other words, after the product is already bought. We can draw an interesting parallel between customer service and product design. When the design of something is not upto the mark, it is noticed, but when the design is good, it is taken to be as expected and goes unnoticed. Similarly, if the customer service is bad, people notice it and talk about it, but if it is good, it is taken to be granted. It is the job of the company to expose this good customer service and make sure people consider it before making a buying decision. 

There are several ways to expose customer service. With the growing interaction between customers and companies through new mediums like blogs, newsgroups and message boards, it is becoming easier then ever to expose customer service. Another very effective way to expose customer service is through advertisements. It’s true that many companies advertise in order to create brand awareness, but along with that, advertisements should also be used to highlight factors that may be able to influence the customers. Something that the customer can remember when making a buying decision. Something that can put your product above the competing products. If your company has the customer service that can play this crucial role, make sure you bring it up in your advertisements.

One company that does a stellar job in advertising customer service is Avis. Avis has designed everything from its tagline (We try harder) to television commercials around its customer service. The car rental company tries to make sure that they communicate to the customers that it will put extra effort to provide the best customer service. Another company that falls under this league is Dell Computers. Customer Service at Dell is exposed right from the moment the customer thinks of buying a computer. Dell makes sure they communicate to the customer that the computer they make is made just for you. Dell commercials and the company blog does an excellent job in to expose both their pre-purchase as well as post-purchase customer service to the customers.

The unique thing to notice about these companies is that they are highly customer focused and they make sure the customer realizes that. They have great customer service divisions and they make sure that the customer takes customer service into account while making the buying decision. No matter which industry your company falls under, you should put in great effort to join this league by following these two steps – first, provide great customer service to your customers, and second, advertise customer service, make sure you communicate to the customer that customer service is an important thing and you are the best option available out there.

Starbucks, iPod and BMW – what is the one thing common in these three brands? Each one of them command a premium over similar products of other brands. It is amazing to see how the customer who creeps so much in filling gas at $4 per gallon, feels so good buying a grande (about 350 ml) latte from Starbucks for the the same price, even when the same coffee at other places is available for much less. Similar comparisons can be drawn for other products varying from a music player (iPod) to a pair of running shoes (Nike) to a car (BMW) to almost anything else.

There are a few things that help companies sell their products for a premium price. First and the most important one is the ecosystem. These brands create a unique ecosystem of some kind of sophestication around them. iPod, for example, creates an urbane and hip ecosystem around itself. iPod advertisements and Apple outlets lays the foundation for this ecosystem. Then every famous personality owning one makes it even more of a premium product. Talk show hosts ask the guests – “what songs do you carry on your iPod?” (instead of “what songs do you like to listen?”). iPod becoming a fashion symbol or more of a necessity adds to this ecosystem. The last leg of the ecosystem is the iTunes software and the whole array of accessories that go with the iPod. A customer can buy special speakers for their iPod, get docking stations, covers and what not. This ecosystem provides a lot of value to the product and helps the company earn a premium. 

A very important thing to note about the premium branded products is their superior quality. Many times we forget talking about this aspect of the products delivered by the premium brands and just focus on the marketing strength of the companies. The premium branded products are most of the time better when compared to the nearest competitor.

Emotional factor also plays a major role in paying the premium. The customers actually pay the premium to treat themselves. Buying these branded products give them satisfaction and help generate a good feeling about themselves. Take car for example. A customer pays a good amount to buy a BMW. Yes it is one of the best cars available out there, but how important is that while making a buying decision? The most important factor that kicks in here is the emotional feeling of the customer for the car. Some people have it in the list of their “things to buy when they can”. Others use it as a factor to satisfy themselves of attaining a certain level of success in life and yet others just buy it to treat themselves luxuriously (and assemble speeding tickets ;)).

Now let’s talk about how some companies are able to put their brands at that level which makes them important for the customers to have even at a premium. To answer this in a couple of words- Expressive Branding. This gives the customers a very straightforward way of making a statement about themselves. Each of these premium branded products have a certain level of luxury attached with them. And believe it or not, every common person loves luxury. People are obsessed by trading up. They will go to a coffee shop and ask for a cup of something which is not less then a tongue-twister for trading up. These brands promote themselves as a channel that people can use to trade up or to make a statement about themselves.

But it is not a bed of roses. When a company does expressive branding, it takes some major risks. When the brand plays the role of creating an identity statement for the customer, it always runs into the risk of a certain segment of people hating it. You will always find people who would never ever buy a certain brand because it’s not their type. The companies going for expressive branding make a very clear statement to the World – love us or hate us, but don’t ignore us. After all, if you want to earn a premium, you have to pay a price for it!