Procter and Gamble is a gargantuan global force in branding, with such names as Bounty, Cover Girl, Dawn, Gillette, Pampers, Scope and Tide in its brand portfolio. So why not take over the biggest media city in the world?
In what P&G calls "the largest consumer event in the company's 175 year history," New York City is being blitzed on June 19 with 25 P&G brands as part of "The Everyday Effect," a new campaign. Throughout the city, P&G will distribute more than 40,000 products at strategically timed moments. The company will offer free Scope mouthwash samples to coffee drinkers, Febreze car vent clips to taxi drivers, and Iams dog treats to people walking their dogs.[more]
Activities will include:
- Delivering free barber, salon, personal care, make-up and nail services at multiple locations
- Brand ambassadors canvassing streets with free pedicab rides, product samples, brand giveaways and high-value coupons
- Special deliveries by Pampers and appearances by characters on behalf of Charmin, Old Spice and other brands.June 19, 2013
"We're making a deliberate effort to demonstrate to consumers how our brands improve their everyday life in small yet meaningful ways," said Melanie Healey, P&G North American Group President. "By providing innovative solutions to the challenges and needs faced in everyday life, P&G brands can help consumers in so many different but important ways. That's what we call the P&G 'Everyday Effect.'"June 19, 2013
P&G's New York saturation campaign will reach far beyond the city. The campaign is supported by a dedicated website, Facebook (where over 2,000 people said they would participate), and Twitter. The company will use its social media channels in the US, Japan, China, Mexico, Germany and Brazil to broadcast the events taking place around the city. Supporting activities around the world will include special consumer events, retail partnerships, in-store displays and brand-focused videos showcasing the everyday effect of using P&G products.
Last summer, P&G partnered with Walmart for a month-long marketing effort that literally took to the streets of New York in a "@PGMobile" truck which made stops around the city. On the side of the truck appeared giant QR codes which consumers could scan with their smartphones so they could instantly buy select P&G products at Walmart prices. Apparently, this experimental program was the precursor to a much bigger bash this year.
The interactive ad, dubbed Burberry Kisses, invites users to send a virtual kiss-sealed letter to someone special. Users take a photo of their pout via the camera on their computer, tablet or mobile device, then add one of five Burberry lipstick colors, write a short note and send via email. The website show's a map that follows the kiss' journey and uses street and landmark imagery.[more]
"What we're really trying to do with the concept is reimagine how luxury marketing is done on the web for Millennials and do it from the lens of beauty products," said Aman Govil, project lead of the Art, Copy & Code project.
While luxury beauty products are often chained to the makeup counters in high-end department stores, the Kisses project allows Burberry to show off its younger, more playful side, as well as its digital prowess—all important traits in attracting Millennials eager to spend their dollars.
“It’s clear that companies like Burberry recognize the importance of digital-advertising campaigns geared toward Web natives," BusinessWeek notes. “So the brand’s partnership with Google makes sense—even if it doesn’t make much obvious sense for Google."
Almost two months after a building collapse in Bangladesh killed 1,127 garment workers, reports have surfaced that claim Walmart has continued to accept shipments from garment factories that itself has black-listed over safety and quality concerns, according to ProPublica.
The largest retailer in the world, which was one of several major Western brands that refused to sign on to the Accord on Bangladesh Safety, released a list of rejected garment factories in May that the company says it refuses to do business with due to repeated safety and labor violations. However, according to import and export data, Walmart has been receiving product shipments from two of the factories on the list, Mars Apparels and Simco Dresses.
Mars was supposedly black-listed in 2011, though was still shipping garments to Walmart as recent as last month, while Simco was placed on the list in January, and continued to ship to Walmart Canada into March of this year.[more]
Walmart spokesman Kevin Gardner told ProPublica that "Mars shipments were allowed because of confusion over whether Walmart's standards applied. Mars didn't produce garments with a Walmart house brand but instead with a Fruit of the Loom label." So, Gardner said, "it wasn't clear if Mars needed to meet Walmart's standards or Fruit of the Loom's."
The supposed black-listed factories aren't the first questionable outposts that have continued to service the industry. Late last month, US bades VP Corp., the largest apparel maker in the world and parent to brands such as North Face, Timberland and Nautica cleared a factory for work despite inspector reports that cited cracks in the walls. The factory also serviced Walmart and Inditex, the parent company of Zara, though Walmart marked the factory as unsafe after the May audit.
However, VF chose to stay with the factory, saying it wanted to "stay and improve" working conditions, Reuters reported. "We are in daily contact with the facility and VF's leadership is closely monitoring the status in this facility and others in our Bangladesh supply chain."
Still, with only 200 trained building inspectors in Bangladesh, many question whether major brands can accurately monitor their supply chains. For Walmart, the brand has in the past had problems with unapproved outsourcing and in turn a long, unclear paper trail of where their garments are actually coming from. While the brand has has assured that its own Bangladesh improvement plans are far better and more efficient than those proposed and signed by over 30 major retail brands, the ProRebublic report begs to differ.
"It's either a question of Walmart just telling people what they want to hear," said Dan Schlademan, a United Food and Commercial Workers rep who oversees the union’s Make Change at Walmart Campaign, "or it's that Walmart has created a supply chain system that they have no control over."
Tesco, the world's No. 3 retailer, has stopped sourcing clothes from Bangladesh after discovering serious problems with the safety of a factory owned by Liberty Fashions. "We immediately made the owners aware of our findings, and tried to find an alternative to ceasing production of Tesco products on this site. We are disappointed that this was not possible.”
While brands continue to navigate the web of factories and new regulations in Bangladesh, local and international governments are pressing forward. Bangladesh's Cabinet, led by Prime Minister Sheikh Hasina, agreed yesterday to sign the Trade and Investment Cooperation Framework Agreement (TICFA) with the United States. Trade between the two countries totaled $5.4 billion in 2012.
Meanwhile, the US House of Representatives has approved a defense authorization bill requiring, “Military-branded garments made for sale at base retail stores operated by the Department of Defense should uphold our nation’s core values and meet international labor standards.” While military uniforms are produced in the US, military-branded apparel can be produced anywhere and garments with US Marines slogans and logos were found in the rubble of the Tazreen factory fire, which killed 112 workers late last year.
Tesla recalls some Model S cars for seat-mount defect.
Dish Network drops pursuit of Sprint Nextel, clearing way for SoftBank.
Alcatel-Lucent plans to streamline.
Amazon rolls out Facebook social gift card.
Chevrolet returns to Oscars with user-generated ad.
Dell sees Carl Icahn raise stake in company.
Johnny Rockets is acquired.
Lifestyle Lift changes national marketing practices after probe.[more]
Nickelodeon resists critics of food ads.
Pizza Hut launches creative review.
Qdoba plans to close 67 underperforming units.
Shazam introduces engagement metric for TV ads.
Subway thrives in Canada.
Taco Bell plans to test "power protein" menu.
United Airlines adds spending requirement for elite-flier status.
Walmart plays catch-up with Amazon in e-commerce.
Wanda Group invests $1 billion to open hotel brand in London.
Because there isn't already enough Angry Birds-themed merchandise in the world, Hasbro and Rovio's Angry Birds have signed a new expanded licensing agreement that will find new Birds gear hitting the market before year’s end.
Since the original Angry Birds mobile game launched in 2009, more than 12 million copies have been sold through Apple’s app store alone. That has led to Angry Birds-branded T-shirts, pillowcases, cake toppers, pet toys, skateboards, and, of course, Duck tape.
Rovio, the creator of the brand, began distributing a weekly animated cartoon series, Angry Birds Toons, in March and a full-length animated Angry Birds movie is expected to hit screens in the summer of 2016, according to a release.[more]
Does this mean that G.I. Joe or Mr. Potato Head will soon be battling Angry Birds? It all remains to be seen. The news comes as Rovio is in the middle of promoting a new iteration of the Angry Birds game that is set to be released soon: Angry Birds Go!
"Angry Birds’ is one of the most recognizable entertainment franchises in the world and we’re thrilled Rovio has chosen Hasbro as its premier toy and game licensee," John Frascotti, Hasbro’s chief marketing officer, said in the statement. “With the new ‘Angry Birds Go!’ property and additional upcoming collaborations between the companies, Hasbro looks forward to delivering more innovative ‘Angry Birds’ toys and games to kids and families across the globe.”
According to mobile-ent.biz, Hasbro isn’t the only company that has recently signed a licensing deal with Angry Birds. Power A is set to develop mobile and video game accessories while Thermos “will develop a line of hydration and storage containers." Pez will sell collectible Angry Birds candy dispensers and soon Angry Birds will have its own multivitamins from Natrol along with inflatables from Gemmy Industries.
Amazon pounced on the opportunity to add Viacom programming to its Prime streaming lineup last month after the broadcast giant couldn’t work out an extension deal with Netflix. That loss is likely costing Netflix big-time as it saw the exit of popular kids shows like Dora the Explorer, SpongeBob SquarePants and Blue's Clues, the very type of content that parents desire when they need to use the electronic babysitter.
However, Netflix battled back this week by signing a deal with DreamWorks Animation, in turn setting itself up to stream a whole host of new kid-friendly content based off of the studio's popular big-screen hits. In another move that seems orchestrated to remind folks, particularly parents, that Netflix still has scads of family programming, it has launched a new site, Netflix Families, that highlights “information on the best ways to stream and videos on how families use Netflix,” as well as feeds of curated content perfect for kids, the company said in a new release.[more]
“We see about a 30 percent increase in family and kids content viewing hours during summer so we know Netflix is a great solution for entertaining families this time of year,” said Ted Sarandos, chief content officer, according to the release. “With the Netflix Families page, we’ve used our proprietary algorithm to create lists we think families will love. In the ‘Are We There Yet’ list we’ve picked TV shows and movies ideal for watching on your tablet in the airport and the ‘TV for Curious Kids’ lists have shows that will help keep kids’ minds active during the summer months.”
The release goes on to say that 84 percent of American families have three or more Netflix-ready devices in their homes, but 59 percent of them are not using them to do so. With the new, dedicated family section, Netflix hopes to change that.
Chrysler was looking for a fig leaf, and the federal government just gave it one. The company ended a dispute with US car-safety officials by agreeing to inspect older-model Jeeps and install a piece of equipment that would help them fare better in low-speed crashes.
The company stunned the industry recently when Chrysler defied a call by the National Highway Traffic Safety Administration to recall 2.7 million remaining 1993-2004 Jeep Grand Cherokees and 2002-2007 Jeep Libertys that the agency said faced a heightened risk of fire from rear-end collisions because the vehicles' fuel tank lies behind the rear axle.
Chrysler insisted the vehicles weren't unsafe and had a performance record in crashes comparable to competing vehicles. A recall of all of the units in question would have cost Chrysler several hundred million dollars.[more]
But pundits quickly warned Chrysler that it was courting PR disaster not only for its rare display of defiance of a fairly widely trusted government agency but also because of the chances that a bad accident, or handful of them, involving one of the vehicles in questio—after Chrysler had refused to address a potentially major safety issue—could be a brand-killer.
"Chrysler obviously calculated the risks and benefits and concluded that the cost to repair these vehicles isn't as expensive as the potential long-term harm that could come from bad PR," Michelle Krebs, senior analyst for Edmunds.com, told Forbes. "This was probably a right decision by Chrysler."
Last year, there were 659 auto-safety recalls issued by the government, "and none of them appear to have had a lasting negative impact on any brand," Krebs noted. "Once the smoke settles, I suspect this will be just a minor blip in Jeep's history."
Chrysler didn't concede that the vehicles were defective but said that it recognizes "this matter has raised concerns for its customers." So the company will conduct a voluntary campaign to inspect the vehicles and, if necessary provide an upgrade to the rear structure in the form of a trailer hitch to better manage crash forces in low-speed impacts.
In the wake of the PRISM scandal, brands are continuing to jockey for their place among the most transparent as the government slowly concedes to releasing more surveillance data collected through the top-secret NSA program, which was made public by whistle blower Edward Snowden.
Requests by Facebook, Microsoft, Google and the like to release data requested by the government have been answered this week. While the initial accusations that the internet companies allowed the NSA to troll data through a wide-open back door was ruled false, the companies still wished to clear their names in conjunction with the thousands of written data requests with which they are charged to comply with per federal laws.
To date, Apple, Facebook, Yahoo, and Microsoft have disclosed the number of requests received over certain blocks of time. Facebook published its first transparency report, where it said it received up to 10,000 requests between July and December 2012. Meanwhile, Apple said it faced up to 5,000 federal, state and local requests between December 2012 and May 2013, Microsoft reported 7,000 requests from July through December 2012, and Yahoo reported the most, with 13,000 requests for data in the past 18 months, the BBC reports.[more]
While most of the requests concerned "fraud, homicides, kidnappings and other criminal investigations," Yahoo, and all others involved, "cannot lawfully break out Fisa [Foreign Intelligence Surveillance Act] request numbers at this time because those numbers are classified," Yahoo CEO Marissa Mayer said in a blog post. Similarly, Google said "lumping police requests with national security requests was 'a step back for users.'"
Still, court records published by The New York Times show that Yahoo has resisted broad NSA requests since 2008 when a judgment forced them to hand over digitally stored email and photos on request. Twitter has been more successful standing its ground, due in part to less content to mine, as well as their top lawyer, Alex Macgillivray, consistently fighting for free expression.
In a statment on customer privacy, Apple maintains that, "Only if appropriate, we retrieve and deliver the narrowest possible set of information to the authorities," noting that the “most common form of request comes from police investigating robberies and other crimes, searching for missing children, trying to locate a patient with Alzheimer’s disease, or hoping to prevent a suicide.” The company was quick to clarify that its legal team evaluates each request and doesn't approve them if "inconsistencies or inaccuracies" occur.
In a follow-up to his public note denying any knowledge of PRISM, Facebook CEO Mark Zuckerberg said that, "Facebook is not and has never been part of any program to give the US or any other government direct access to our servers. We have never received a blanket request or court order from any government agency asking for information or metadata in bulk, like the one Verizon reportedly received. And if we did, we would fight it aggressively.”
General privacy concerns across the internet and social networks has always existed, so most of the public's ire has been directed towards the US as Snowden threatens to reveal more classified information. As for the country's reputation? President Obama has ensured Americans that they aren't getting the complete story, saying in a PBS interview that just because there is a "tradeoff doesn't mean somehow that we've abandoned freedom," The Next Web reports. In a bid to preserve its own interests and quell concerns of citizens, Obama said he has asked the intelligence community to "see how much of this we can declassify without further compromising the program."
Starbucks customers will still be able to order all of their favorite high-fat, sugary concoctions at their favorite coffee house. It's just that they won't be able to plead ignorance anymore to just how many calories are in that Venti Caramel Macchiato or luscious chocolate brownie.
The company said it will become the latest restaurant chain to put up calorie boards at its locations across the United States, jumping ahead of a US-government mandate under Obamacare that's expected to require bigger chains to make similar disclosures nationwide by the end of the year. New York and California already require nutrition boards.
Starbucks also will post calorie counts on the goodies in the pastry case. "Menu labeling is yet another step to extend our commitment to wellness, ensuring our current customers and partners (employees) have the information they need to make informed decisions and understand all the ways that they can customize their Starbucks beverages to be within their desired calorie range," stated Mary Wagner, SVP of global research and development for Starbucks.[more]
McDonald's began posting calorie counts on menu boards in the US in September in the midst of unrelenting criticism of its menu as unhealthy, even though McDonald's has introduced plenty of "better-for-you" options over the last several years and is constantly fine-tuning its menu.
Though many Starbucks concoctions are very calorie-rich, the brand has flown under the radar in terms of public criticism of the nutritional value of its largely liquid menu. Starbucks also has added lower-calorie options like soy milk and oatmeal over the years.
Now, each Starbucks beverage will be listed as a standard recipe in the calorie counts, though Starbucks noted that each is fully customizable, such as ordering without whipped cream, choosing a different milk or sugar-free syrup. The boards will debut by June 25 across America, so US customers can enjoy a last guilt-constrained frappucino before then.
Its "Commitment to Wellness" infographic released today also hints at more to come, with the fine print reading: "More announcements coming soon!"
Brazilian soccer fans are some of the most dedicated in the world, but an ad campaign from Ogilvy Mather let them know there was one more thing they could do if they wanted to be sure that their heart beat for their team forever: be an organ donor.
The “Immortal Fans” campaign, which just took top honors in the Promo & Activations category at Cannes Lions, focused on the Sport Club Recife team. In the spot, actual patients that were waiting for organs spoke to fans directly, saying things like, "I promise that your eyes will keep on watching Sport Club Recife" or "I promise that your lungs will keep on breathing for Sport Club Recife."[more]
Part of the reason it won, surely was because of its effectiveness. Organ donations went up 54 percent in the country and around 51,000 fans of the club said they would hand over their organs when they died. Those kinds of numbers helped reduce the waiting list for heart and corneal transplants in the country, Creativity-online.com reports. "It's something 60 years from now people will say, 'That was really timely, and yet really timeless,'” said Rob Schwartz, TBWA Worldwide’s creative president, who headed up the jury awarding the prize, AdWeek reports.
The unique public health ad touches on a growing trend to garner more attention to sensative and personal health subjects like donation through new mediums like social media. After all, when Facebook allowed users to indicate their donor status on their profiles, the US saw a 20-fold spike in registrations in the first day alone. Since its debut last May, the numbers have fallen back to normal levels, Time reports, however the spike in interest and activity showed researchers that there is a certain 'viral' aspect to public health.
Another big winner out of Cannes was Heineken, which took home the Grand Prix for Creative Effectiveness for its Legendary Journey global campaign. Charged with uniting its brand across 170 markets, Heineken chose to embrace its global nature and turn the drinker into a legend. While the campaign is still young, it has proven to have a positive impact on volume, share value and price premium across global markets.
7-Eleven has said it will implement "aggressive actions" to take over stores owned by some of its East Coast franchisees that allegedly used a slave-like system to exploit immigrants from Pakistan and the Philippines.
But will it be enough to adequately address the outrage and legal issues created by how nine owners and managers of 7-Eleven stores across Long Island and in Virginia allegedly made tens of millions of dollars by stealing most of the wages of workers at 14 stores? Could 7-Eleven have done more, sooner, to thwart or prevent such a situation? And how might the brand overall suffer even if there was credible corporate deniability in all of this?
The many giant western retailers dealing with the burnt and crumbling garment factories in Bangladesh can attest to the mess that horrific practices and conditions can generate for a brand even if there is no direct culpability for such problems.
US authorities charged that the franchise owners paid the workers using stolen Social Security numbers of a child and three dead people while stealing most of their wages. When 7-Eleven headquarters sent the wages for distribution, the government said, the employers stole up to 75 percent of the workers' pay. They also allegedly forced the immigrants to live in houses they owned and pay the owners rent in cash.[more]
"These nine defendants created a modern-day plantation system, with themselves as overseers, with the immigrant workers as subjects, living in their version of a company town," US Attorney Loretta Lynch told reporters at a news conference in Brooklyn. "This case came to light because some of these defendants, despite their lack of legal status, came forward to report the exploitation."
No doubt it's not news that convenience stores represent one of the very most entry-level environments in the US economy. It's also possible that there's other similar types of exploitation going on at such stores, especially because the American job market hasn't been nearly as attractive to immigrant workers—legal or otherwise—for the last few years as before.
But could 7-Eleven, certainly being aware of all of the above, have done more to prevent this particularly egregious case of exploitation? Apparently the company didn't catch the problems with the workers' Social Security numbers even though 7-Eleven corporate was regularly processing them.
Surely more will come to light. But it's already clear from the unfortunate happenings in Bangladesh that, in a world of global employment and communications, brands can't just shrug off such problems as "supply-chain issues." Though 7-Elevens are franchised, customers perceive a single brand.
And that's something 7-Eleven executives are getting a lesson in right now.
[Note: This blog post has been updated to remove a phrase that the author didn't realize offended some readers; we regret the error.]
Marriott is going all-in on Millennials. The Bethesda, M.D.-based company is launching a new logo and tagline, "Travel Brilliantly" in its latest attempt to attract the growing market of young travellers looking for luxury at a value.
The international hotel chain recently announced it will bring its European hotel brand, AC Hotels by Marriott, to the States to attract younger business travelers, while it is also planning to introduce a Millennial-friendly hotel brand, Moxy, across Europe in a partnerhsip with IKEA.
What's in it for Marriott? According to the Washington Business Journal, “younger business travelers who make three or more business trips per year are a $35 billion market.” The chain hopes to attract the sought-after demo with a new, simplified "M" logo, a mobile app, offering different dining options, and allotting more open spaces in its hotels that can be used as public workspaces as well as streamlined rooms.[more]
“We haven’t seen any other hotel brand capturing younger travelers in a very authoritative way,” said Mara Hannula, vice president for global marketing of Marriott Hotels, according to The New York Times. “We see this is as a big opportunity for Marriott.”
The launch video for the campaign intones that the hotel offers up “the promise of spaces as expansive as your imagination,” “surprises that will change as often as you do,” and “a new way to inspire, create, connect.” That may all be true, but the goal is to snag the younger consumers who likely are always working even if they’re traveling for pleasure; if Marriott can offer up services to satisfy the mobile, global youth market, it is hopeful that it can get a big boost in revenue.
To help that cause, the campaign will be pushed on TV, mobile and digital advertising, as well as on its own, dedicated website, which asks consumers for ideas on how to make its hotels better.
Late last week, Vice magazine promoted a new pictorial spread from its Fiction issue. The problem? The photos depicted a handful of famous suicides by legendary female writers with appalling attention to detail, right down to the hosiery that hung Taiwanese author Sanmao.
The youth culture publication is well-known for its edgy content and no-holds-barred attitude—a reputation that has repeatedly made headlines and garnered unfavorable reactions from readers and critics, even as it partners with the likes of CNN and HBO.
While the brand has successfully turned itself into a more respectable news source over the years, partnering with brands and producing documentaries like its much talked about Basketball Diplomacy stunt that brought Dennis Rodman and the Harlem Globetrotters to North Korea to wrap its first season on HBO, Vice still gets its kicks from content like the "Last Words" spread, which, after much protest, was pulled from its website on Tuesday and replaced with a statement from the editorial staff:[more]
"'Last Words' is a fashion spread featuring models reenacting the suicides of female authors who tragically ended their own lives. It is part of our 2013 Fiction Issue, one that is entirely dedicated to female writers, photographers, illustrators, painters, and other contributors.
The fashion spreads in VICE Magazine are always unconventional and approached with an art editorial point-of-view rather than a typical fashion photo-editorial one. Our main goal is to create artful images, with the fashion message following, rather than leading.
'Last Words' was created in this tradition and focused on the demise of a set of writers whose lives we very much wish weren’t cut tragically short, especially at their own hands. We will no longer display “Last Words” on our website and apologize to anyone who was hurt or offended."
The consensus is that VICE, in publishing the spread that features models depicting the self-propelled deaths of literary greats like Sylvia Plath, Virginia Woolf, Iris Chang and Charlotte Perkins while garbed in designer duds, is glamorizing suicide. Speaking solely on journalistic standards, there are studies and guidelines that advise against writing or depicting such acts, as data has shown that doing so can increase occurence among the public, according to The Guardian.
"Covering suicide is always hard because there is a fine line between raising awareness of a vital public health issue and contributing to a spectacle that could harm vulnerable people. Which of those two was the feminist website Jezebel doing when it decided to republish Vice's pictures, alongside outraged commentary? And have the thousands of tweets on the subject, not to mention this article, simply told Vice that it has found a tender spot in our collective consciousness, which it can jab to great effect?" writes The Guardian.
What do you think? Has VICE crossed the line, or is it just the latest brand to find creative inspiration in suicide?
7-Eleven franchisees are accused by feds in immigrant exploitation scheme.
Starbucks to start displaying calorie counts on menus later this month.
Susan G. Komen Foundation names new CEO.
3M adds new products to its healthcare line.
AOL nears profitability in Patch bet on local news.
AT&T introduces solar-powered charging stations.
Cheesecake Factory returns to growth mode.
Chrysler sees key deadline near in Jeep-recall dispute with US government.[more]
Coke is Cannes' 2013 Creative Marketer of the Year.
Ed Hardy blames reality TV dad Jon Gosselin for tanking his clothing brand.
Marriott modifies marketing message.
Media Bistro debuts new logo, redesigned website.
Medtronic fails to get independent stiffening of spine-product credentials.
Microsoft and Sony set up fall battle around release of Xbox One and Play Station 4.
MTV turns attention to younger viewers.
Noodles & Company sets IPO.
Pizza Hut debuts flatbread.
Volvo faces identity crisis in US.
At least that's how other car brands look at Nissan's aggressive move to grab US market share by cutting prices on seven models and boosting incentives, taking maximum financial advantage of the weakening yen that Japanese Prime Minister Shinzo Abe has made a central plank of his "Abenomics" strategy to boost the island nation's economy.
Nissan's marketing moves "strike me as a scorched-earth policy of going for market share and sales volume at seemingly all costs," Michelle Krebs, an analyst for Edmunds.com, told Bloomberg.[more]
Rival automakers are frosted at what Nissan is doing for at least three reasons. First, of course—no one likes competition cutting prices, for the most part. Second, the industry remains keen to avoid the contagion of incentives-based pricing that dogged it into the late 2000s, hurting profits, tarnishing brands and, ultimately, leading to the 2009 meltdown that put General Motors and Chrysler into bankruptcy.
A third, related reason is that the industry has it pretty good right now. With the capacity cutbacks that many automakers made in the Great Recession, factory utilization is high despite heightened competition. Vehicle production in North America is back near record levels, Automotive News pointed out, with output forecast to surpass 16 million units this year for the first time in a decade. Even high-profit pickup trucks are selling briskly thanks to the housing recovery. Profitability is grand.
So what's the problem if Nissan wants to get aggressive about discounting? The company has an erratic history on incentives, and the Detroit Three, as well as Nissan's other competitors, have the strongest product lineups in their histories, presumably strong enough to keep Nissan from prying away too many of their customers.
But it's a value-oriented auto market these days, too, and Nissan did pick up a point of market share in May, up to a 7.9 percent share. If Toyota gets bothered enough to protect its brands and products from the tactics of its close rival, analysts said, then the entire industry will feel unwanted pressure to get more generous too.
None of this is slowing down Nissan for the moment; perhaps only a moderation in the decline of the value of the yen might do that.
"Consumers are going to realize that we are present in some pricing segments where before they were not seeing us," Jose Munoz, Nissan's senior vice president of sales and marketing, told Bloomberg. And that means Nissan's competitors will be seeing Nissan too—and maybe raising them.
If there's one thing that American CPG brands and retailers have learned over the last three years, it's that there definitely is a new normal when it comes to the attitudes of US consumers about their pocketbooks. The economy may be slowly coming back, but there doesn't appear to be much change in the recession-borne dedication of grocery shoppers to getting the absolute most out of their supermarket dollars.
That's the bottom line being addressed by food-industry brands in various ways these days. Kroger's latest move has been to open a stream of stores, mostly around the Midwest, under a new discount brand called Ruler Foods.
Part of JayC Food Stores, which Kroger purchased in 1999, Ruler Foods now has 18 locations under a test concept for the Cincinnati-based grocery giant, according to the Commercial News in Danville, Ill. Rulers sells Kroger brand food and a limited assortment of other national-brand items.[more]
"We have high hopes for it and we're pleased with the results so far," a Kroger spokesman told the newspaper. "It's too soon to say whether it opens in other markets."
Lest anyone forget about the consequences of not playing the value-shopper card right, there is a new CEO at Procter & Gamble, whose current one could have played the new normal better; the sight of Tesco leaving the US market with its tail between its legs and heading back to the safety of its UK home; and fast-food chain after fast-food chain that has been struggling for months to make sure value consumers are effectively served.
There are other no-frills aspects to Rulers: no pharmacy, and no fuel center. Customers bag their own groceries and "rent" shopping carts for 25 cents, the publication said, which is returned when the cart is replaced. This apparently cuts the number of cart gophers needed for each store. Rulers have all of the typical grocery-store departments, but less selection than most.
"The value shopper is a growing customer segment, one we think is here to stay," the spokesman said. "This concept store is helping us learn how to be relevant to value shoppers and create deep and lasting loyalty."
Gilt, the innovative fashion flash-sale site is opening a physical outlet in Louisville, Ky. for one month beginning June 28th.
The pop-up shop, dubbed Designer Outlet, will house thousands of products for men, women and children as well as accessories and housewares from Zac Posen, Vera Wang, Badgley Mischka and Missoni, among others, for up to 90 percent off.
"The exciting new concept store is a unique addition to our local retail market. We're fortunate that Gilt's presence in Louisville affords us the opportunity to dress high-style at great prices and I'm sure it will be well-received by consumers," said Craig J. Richard, President and CEO of Greater Louisville Inc.[more]
While the site hosts an annual Gilt City warehouse sale each year near its headquarters in New York, among other locations, the pop-up shop, which will run for one month, is the first of its kind. As for the location? Louisville is a stone's throw away from one of the site's largest distribution centers in Shepardsville, Racked reports.
The move is another attempt by Gilt and similar online operations to skirt flash-sale fatigue. While the concept was built on the idea that users shop during specific windows of time, 30 percent of Gilt's traffic comes from mobile devices which means users want full access when they want it, and wherever they want it. As a result, Gilt has launched 9 p.m. sales on Wednesdays and Sundays, and has experimented with dedicated online shops that users can access anytime.
A step ahead, online curation site Fab.com moved to open up a retail store in Hamburg, Germany earlier in the spring as the site looks to broaden its global reach. The startup, which originally targeted gay men, has done just that, claiming 12 million registered members in 28 countries, with 40 percent of sales coming from outside the US. The e-commerce retailer expanded its offerings as well with its acquisition of German custom furniture maker MassivKonzept, enabling Fab users to design and order items built to their specifications.
Fab has built up its inventory of in-stock goods as well as consumer choice is still king in retail, whether in-store or online.
Image courtesy Racked NY.
The streaming race between Netflix and Amazon is neck and neck again as both service providers have inked new streaming deals for in-demand programming.
The news comes just a week after Netflix suffered a blow as it relinquished its deal with Viacom and saw Amazon quickly scoop up its rights to popular kids programming like Dora the Explorer, Blue's Clues and others. But now, Netflix is back on the horse thanks to a new deal with DreamWorks.
The long-in-the-making deal with DreamWorks Animation will supply Netflix with 300 hours of original programming inspired by much-loved DreamWorks characters like Shrek and The Croods, as well as series featuring Casper the Friendly Ghost and Lassie, which DreamWorks has rights to through its purchase of Classic Media.[more]
“For Netflix, the DreamWorks Animation programming will help fill a hole left by Nickelodeon," notes The New York Times. But the deal isn't just good for Netflix, as it helps DreamWorks realize its potential beyong the big screen. "DreamWorks Animation had three primary TV options: starting a cable channel of its own, perhaps in partnership with 21st Century Fox, which distributes its movies; teaming with an upstart children’s network like the Hub (or taking it over); or bypassing cable completely and going with Netflix."
While the deal is settled, Netflix customers will have to wait until December to catch a glimpse of DreamWorks' first original series, which will be based on the Turbo film.
Meanwhile, Amazon’s LOVEFiLM, the on-demand streaming service for the UK and Europe is giving subscribers access to a mix of classic and modern Disney titles like Dumbo, Ratatouille, Wall-E and the Chronicles of Narnia, The Next Web reports. Users will have instant access to Disney Movies on Demand for streaming to their TV, smartphone, tablet or gaming system.
Ford has finally given in to the primordial leanings of its customers and decided to put more old-fashioned knobs and buttons on its infotainment controls. But the move—arguably, belated by two years—still might not be enough to save Ford this week from another poor third-party evaluation that got the brand into trouble in the first place.
Ford will reprise tuning and volume knobs for the radio as it redesigns existing models and introduces new ones, Raj Nair, Ford's global product-development chief, told the Wall Street Journal. That's because the company finally gave in to two years of complaints about the initial version of its touch-screen multimedia system, MyFord Touch and MyLincoln Touch, which essentially were a Version 2.0 of its popular Sync technology.
In 2011, reports by both J.D. Power and Consumer Reports—two of the most authoritative sources of independent evaluation in the business—slammed Ford for MyFord Touch because the touch-screen interface, voice-activiated controls and other aspects of the system confounded users. Power even labeled it a "quality" issue and dropped Ford from one of the top auto brands in its annual Initial Quality Survey to a below-average brand.[more]
The next annual Power "IQS" is due out on Wednesday. It isn't yet clear if Ford is expecting to be slammed again by the Power ratings, but the timing of this week's revelations makes it seem like word of Ford's changes may be meant to take the edge off a report that the company knows or presumes will be negative once again.
What is also not clear is why Ford took so long to reach the conclusion that it just had to bring back some knobs and switches. Even before Power issued its report around this time two years ago, Ford executives including CEO heir apparent Mark Fields were telling journalists that they were on top of the situation. Then they proceeded to spend two years issuing software patches and new training directives for Ford dealers and sales personnel aimed at alleviating the MyFordTouch situation.
And now they're finally signaling that they will begin to put in more knobs and buttons as models are updated or replaced—meaning that it could still take years to address this situation definitively?
"We've been able to spend a lot of time with customers to find what exactly are the areas that are bothering them," Nair told the newspaper, in a thorough bit of understatement.
The other part of Nair's quote belies what might have been the reason for Ford's head-scratching delay in getting to the bottom of this issue: It wanted to protect the reputation of MyFord Touch because it was the ballyhooed follow-on to the much-heralded Sync system, which truly was an infotainment trailblazer.
"The satisfaction is higher on the vehicles equipped with MyFord Touch than without," Nair said. But not nearly as high as it could have been, even by now, if Ford had jumped with effective dispatch on this issue earlier.