Redefining Your Product Category

It’s not enough to win with quality or technical features. If every brand’s point of difference is simply the quality of its products, it’s not really a point of difference no matter how true their claims are – it’s merely the cost of entry. What’s needed is the initiative to compete in some other unidentified element, as was done in the following campaign that recently went viral.

Instead of following the tradition of boasting overall superior protection, Always took a different approach with its #Likeagirl ad – female empowerment. Other brands such as Kotex, which once took a satirical approach, and HelloFlo, which boldly and directly used humour to address first-timers, also deserve honourable mentions for differentiating their brands in areas outside of technical quality. The emergence of such a variety of campaigns certainly makes for an interesting battle in the feminine hygiene category and it is difficult to say which branding strategy will prevail in the long-term.

However, I think the Always ad is worth noting as it is highly reminiscent of the award-winning Dove Campaign for Real Beauty (although the two relate to different categories, I wouldn’t be surprised if P&G owed some of its inspiration to one of its closest competitors in Unilever). Obviously as a male, I am no expert on feminine hygiene, but what makes a great marketer is someone who understands their target market even if they don’t belong in that market as a consumer themselves. And the brand team behind the Always ad has indeed proven that it understands its target market of primarily young female teens going through puberty, as well as their respective mothers seeking to educate their growing daughters. Said teens and mothers connect emotionally with empowering messages and Always has capitalized on this trend.

By connecting with the consumer on an emotional level, Always has effectively captured a unique point of difference that is difficult for competitors to imitate without being seen as copycats. Rather than falling victim to battles of product quality (similar to the Pepsi Taste Test Challenge), P&G redefined the category in a way that was unique and compelling, steering clear of challenging its competition directly. As a result, to the consumer, it’s no longer about buying the pad that provides the most protection; it’s about associating with a brand that makes them feel good about themselves.

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MBA Reflections

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As I attended my MBA convocation this past Friday, I was originally going to write about the cliché bittersweet feeling of completing my degree and how my experience was filled with highs and lows, and then end with the corny acknowledgement of all the great friends that I made. But as I reflected on what I valued most from my MBA experience, I was eventually reminded of what bothers me about traditional education – precisely because my MBA was able to step outside the bounds of traditional education.

So while I did in fact have an enjoyable experience and made plenty of new friends, I’d like to instead focus on what I specifically found valuable about my MBA experience and briefly discuss why, as a result, I believe that education needs to be revisited (as Mark Ecko would agree).

But before I get into the details, it helps to address a few of the many common myths that I feel have given the MBA a bit of a bad rap.

Myth #1: MBA programs are full of cutthroat, egotistical go-getters looking to climb the corporate ladder at any cost. Not true. I used to have this impression of MBA students as well, but I couldn’t be more wrong. Certainly, the students at Schulich are ambitious, but they are also some of the most passionate, collaborative, helpful, funny, kind, and inspiring individuals I’ve ever met.

Myth #2: MBA students don’t add value, they just use meaningless buzz words. As I discuss below, the frameworks that are taught in business school are valuable in a way that is often underestimated in the professional world. “Buzz words” are only meaningless if they’re irrelevant; when used appropriately, they are helpful in critical analysis.

Myth #3: The MBA adds no value to one’s professional career. This depends entirely on the student’s purpose for pursuing an MBA degree. In most cases, it’s not about the technical course content – most of the concepts can be learned from reading books or online materials. But it’s primarily the social and analytical skills developed and the connections built that are most valuable in the MBA.

More specifically, the Schulich MBA had several elements that were crucial to my personal and professional development, and that shaped my overall experience at the school:

Projects: The Schulich MBA program is highlighted by a capstone consulting project known as the “601”, which is an 8-month consulting engagement with a real client to whom students provide a strategic recommendation based on countless hours of research, analysis, and team meetings. I also had the pleasure of taking Negotiations, one of many practical courses that develop soft skills by putting students through various real life simulations. And most courses don’t have a final exam – instead, they have final presentations, reports, assignments, etc, which encourages learning by doing, rather than by regurgitating.

Frameworks: While many business frameworks can be learned on your own, it’s the mindset that students are encouraged to develop that can be taken with them to their future professional roles. They provide a certain perspective that may not otherwise be immediately apparent to someone who only views their organization working from the inside.

Class discussions: These were eye-opening for me as I now understand why most MBA programs require students to have work experience in order to be accepted. Your peers provide such a diverse range of real life experiences that contribute to the content and the quality of discussions. I am also impressed with the quality of faculty members that teach at Schulich. Unlike my experience in my undergrad, I can definitively say that I have loved each and every professor that I’ve had at Schulich because of their extensive backgrounds, their fascinating insights, and their ability to hold engaging discussions.

Extracurricular activities: This was what I missed the most after completing my undergrad and entering the workforce. Going back to school gave me a second chance to get involved with one of my biggest passions in attending and organizing students clubs and events, which I did through my involvement with the Schulich Marketing Association (SMA).

Connections, networks, relationships: Schulich peers, alumni, professors, guest speakers, Career Development Centre employees, etc…they have all played a role in my development and such relationships will last well beyond my time at the school.

Notice that all of these elements of the MBA program have a practical application to the real world. What’s a little concerning for me was that I had to pursue a master’s degree and pay over $30,000 in tuition to earn these experiences – experiences that I did not have in my undergraduate studies. Much of the course content in both my undergrad and my MBA is similar, yet most undergrad programs focuses heavily on measuring student performance via written exams and give minimal attention to other, more practical, methods of learning. If we wish to better prepare students for their professional lives after school, we need to provide them with opportunities for skill development earlier in their careers. And as such, once again, education needs to be revisited.

Notwithstanding my concerns, the MBA was no doubt a worthwhile endeavour and I am grateful for the doors it has opened for me in pursuing my passions and furthering my career goals.

 

Target Canada: Turnaround or Exit?

As a regular shopper, you may already know of Target’s struggles entering the Canadian market. But you may have yet to see the retailer’s latest attempt at a hopeful turnaround – a YouTube video featuring various employees directly acknowledging the company’s recent problems.

The publishing of this video comes amidst a whirlwind of problems for the retailer since it officially opened its first stores in Canada in March 2013. Such problems included complaints of high prices and poor supply chain management, a massive data breach, creepy privacy issues, and even dismissal of the Target Canada President. As you can expect, followers on social media have been quick to attest to these grievances, and rightfully so. However, as unfortunate as each of these individual mishaps are, I believe there is a much bigger issue that Target needs to address, and it has to do with its brand strategy.

In the world of retail, players generally have four areas in which they can differentiate: price, product selection, convenience, and customer experience. Successful retailers will generally focus on one or two of these areas and do just enough in the other areas to stay afloat. The employees featured in the apology video are well aware of the retailer’s pricing and inventory issues, but these are all a result of a poorly executed brand promise – i.e. failure to focus on the appropriate area of differentiation.

Somewhere along the expansion process, Target got lost with its brand strategy as the retailer got thrown into cutthroat pricing wars with competitors such as Walmart and online giant Amazon, rather than staying true to its identity that proved successful in the US – its focus on the customer experience. By competing on both price and customer experience, Target failed to excel in either strategic component, primarily because retailers like Walmart and Amazon are the gold standard for discount pricing. The only way for Target to stand out is via delivery of an exceptional customer experience (for example, much like IKEA’s store setup for a family outing or Home Hardware’s motto of homeowners helping homeowners). But as a result of Target’s poor execution, Walmart’s motto “Save Money. Live Better.” became a much more compelling promise than Target’s “Expect More. Pay Less.” in Canada over the past fiscal year.

But even if we establish that Target should stick to providing a superior experience to its customers – or “guests” as the company likes to call them – the next question that needs to be answered is whether or not anyone cares for such an experience. That is, is there even a market for upscale retail customer experiences in Canada? Just because this strategy worked in the US does not mean it will translate north of the border for the retailer’s Canadian counterparts. And so far, it clearly hasn’t.

So ultimately, how effective will the apology video be in sparking a turnaround for Target Canada? Despite mixed feelings expressed on social media, I believe it is a good start for the company’s brand because, at the very least, it addresses the problem bluntly and directly. Such transparency is crucial for any brand revival and I would give credit to Target for being upfront and honest about its struggles; we have seen that transparency can work very well as it did with McDonald’s award-winning “Our Food. Your Questions.” campaign.

That being said, it is concerning that the video has yet to attract a significant number of views since it was published last week. The company will need to improve its digital strategy to make ground on its competitors, most of whom feature up-to-date product pricing on their websites and actively engage customers on social media.

While Target once again deserves credit for recognizing the problem, my gut tells me that there isn’t a market for upscale retail experiences in Canada because of the poor economic climate. When times are tough, people simply don’t care about experiences when it comes to seeking their basic household needs – they just want to save money.

What do you think will happen next for Target Canada? Will it make a significant turnaround? Or is an exit imminent for the struggling retailer?

The Art of Marketing Conference

It has been a while since my last post. For the last two weeks, I was busy learning a new craft – making stuffed animals, a rather challenging form of art if you want to be creative. I’ll post more details and pictures of my creation later.

I had the opportunity to attend the Art of Marketing Conference a couple of weeks ago. The event featured a variety of brand and marketing experts and a keynote from Malcolm Gladwell. While I hadn’t previously heard of most of the speakers in the room, there was no doubt plenty of insight, innovation, and humour shared throughout the day. Rather than providing a play-by-play of what was said and what I learned, I thought it would be better to list my top 5 key take-aways from the day.

1. QR codes are stupid. Scott Stratten, author of “QR Codes Kill Kittens”, blasted QR codes in a passionate plea filled with wit, humour and examples of some of the most outrageous uses of the technology. The once promising QR codes have become an unintuitive, nonsensical, logistical problem that requires additional and often unnecessary effort from consumers. There are plenty of websites depicting the “fails”  of QR codes: http://wtfqrcodes.com/

2. Immediacy is imperative. Especially in the social and mobile space. When you have customers who can complain about your customer service in real-time, you better respond in real-time. The story of Joshie and the Ritz-Carlton (http://www.huffingtonpost.com/chris-hurn/stuffed-giraffe-shows-wha_b_1524038.html) was referenced several times throughout the day – the hotel’s quick response was key to maintaining its standard of service and brand image, which leads to the next point…

3. Your logo doesn’t matter. It’s the associations that consumers make with your logo that matter. While I don’t fully agree with this statement, it does highlight the importance of actions speaking louder than words (or pictures, symbols, etc), which is why…

4. Brand building starts on the inside. Having had this hammered into my head in most of my b-school courses, this is obviously nothing new. But many companies today could still benefit from this truth.

5. Education needs to be revisited. Not exactly marketing-related, but it came from Mark Ecko, who spoke at length about the type of learning that inspired his work in music and personal branding. I couldn’t agree more with his point that education shouldn’t just consist of a structured formula and a few textbooks churned out by a publishing company; people learn best by doing and our education system needs to follow that.

*Bonus take-away: Canadians are extra polite (apparently). Yes, not only are we known for this, but apparently we love to admit it too.

Gatorade’s All-Star Cast

This time of the year is always the most exciting for me primarily for two reasons: 1) it’s the beginning of summer and 2) it’s NBA Playoff time. As a consumer and an NBA fan, the first brand that comes to mind when I think of these two things is Gatorade. And surely the intersection of summertime and athletic events no doubt screams opportunity for the brand manager of any sports drink.

What I have always found incredible is the sheer dominance of Gatorade over its competitors in this category despite the fact that an average consumer probably could not tell the difference in taste between Gatorade and its closest rival, Powerade. This rivalry is particularly interesting in light of the fact that PepsiCo often falls second to Coca-Cola in other categories, most notably carbonated soft drinks. In 2013, Coca-Cola had a 42% U.S. market share in this category, well ahead of PepsiCo’s 29%. Yet in the isotonics category (a scientific term to describe the concentration of sugar in sports drinks), PepsiCo has been the clear winner over Coca-Cola for years:

Powerade has indeed made strides in capturing some of Gatorade’s share, but hardly enough to erase such a significant lead. And I think the reason for this goes beyond simply Gatorade’s first mover advantage (i.e. being introduced 20 years earlier than Powerade). It has more to do with the way Gatorade has positioned its brand in the consumer’s mind.

When we purchase sporting goods of any kind, we often aspire to behave like our athletic role models. Athletic sponsorship of professional athletes serve not only as endorsements of product quality, but they also provide a subconscious fantasy of validation to the consumer. When a young teen wears a Jordan-branded pair of shoes over a private label brand to play basketball, he subconsciously feels like he is following the ritual of Michael Jordan himself: “Jordan is the greatest basketball player of all time. If I wear these shoes, I will belong in that category of basketball players.” I’m not saying wearing Jordans will make you as good as Michael Jordan, I am simply highlighting the psychological effect that athletic endorsements have on our purchases.

So you might be wondering: what does this have to do with Gatorade’s success? Well if we compare the athletes sponsored by Gatorade with those sponsored by Powerade, we begin to notice a significant difference.

When we talk about Gatorade athletes, we’re talking about MVP-caliber athletes, many of whom have eclipsed their respective sports by winning multiple accolades and/or setting world records: Sidney Crosby – 2007 NHL MVP and 2009 Stanley Cup Champion, Kevin Durant – 2013 NBA MVP and four-time scoring champion, Peyton Manning – SuperBowl XLI Champion and four-time NFL MVP, Serena Williams – 25 Grand Slam titles, Kerri Walsh and Misty May-Treanor – two-time Olympic Gold Medalists, Usain Bolt – world record holder in numerous track & field events.

Meanwhile, Powerade’s list of athletes include Chris Paul, Ryan Howard, Venus Williams, and Chris Johnson to name a few. These individuals, some of whom I had never heard of before this post, are all great athletes and all-stars, but certainly not the best of the best in their respective sports.

The only exceptions to Powerade’s mediocre athletic cast are Lebron James and Derrick Rose, two former MVP’s whom the brand is fortunate to have on board. However, such endorsements are insignificant in the face of a leading brand whose top athletes span a much wider selection of sports.

Furthermore, not only has Gatorade assembled a greater all-star cast, it has also preempted its competition by clinching its official sports drink status in some of the most popular professional sports leagues, including the NFL, MLB, NBA, MLS, and AVP. This has left Powerade as the official sports drink of other leagues such as the PGA Tour, NASCAR, and NCAA.

It’s clear from all of this that endorsements have a powerful effect on consumer behaviour and, ultimately, business results. Because of the strong psychological effect mentioned earlier, the quality of the endorsement becomes the quality of the product to most consumers. If you secure A-rated athletes, you get A-level results, and your competition is left with B-rated athletes and B-level results.

The state of the sports drink market as described is particularly unique in this way especially given the nature of fast-moving consumer goods. In the CPG world where short-term promotions are launched to gain or regain market share temporarily, long-term brand loyalty is often overlooked. Yet short-term promotions have the potential to achieve long-term results if they preempt the competition in a way that is largely inimitable. And that is exactly what Gatorade has done with its endorsements.

 

 

My Whiteboard

Have you ever had a brilliant idea pop up in your mind unexpectedly when no one was around to hear it? And by the time you were ready to share it, you had forgotten what it was and wished you had written it down?

We have likely all been in this situation at some point in our lives and I wonder if this small mishap has often stifled the next big idea. To think…”if only someone with a similar frame of mind and the same level of excitement were around to discuss my idea at the time, who knows what we could have conceived? The next revolutionary mobile device? A cure for cancer? A remedy for global poverty?” I’d like to believe that the possibilities are endless, but without fruitful discussions and some avenue for learning, great ideas get lost.

And that is where this blog comes in.

I believe that learning is a lifelong process that helps us achieve great things, both individually and together. When we share our ideas, engage in healthy conversation, and participate in productive activities, we support the growth and development of each other. This blog primarily aims to serve as my contribution to the discussion.

As for who I am and what I hope to accomplish, there are three main reasons why I decided to start this blog:

  1. I love writing. Coming fresh out of the Schulich MBA program, I have developed an adrenaline for writing reports and delivering presentations. As grueling as the last few months have been, one of the things that I will miss and that I always miss about school in general is the limitless writing opportunities. With this blog, I can express my thoughts in an infinite number of ways to create my own story.
  2. A blog is a writer’s whiteboard. That is, a blog is one of the few mediums through which someone can take the time to provide a clear, holistic, and coherent picture of who they are, what they are thinking and how they think. It allows me to document my thoughts and walk you through my wavelength, free of outside distractions that are common in other forms of social media.
  3. I am a lifelong learner. As I mentioned before, I wish to contribute to the world and they say that the best way to learn something is to teach it. I’m not saying I’m an expert in what I will discuss, but sharing my insights and perspectives will hopefully be valuable to both my learning as well as my readers’.

While this blog will focus primarily on marketing strategy, branding, advertising, business, etc, I will also share my experience with my other passions, including sports, music, dance, and food to name a few. Lifelong learning is much more than one’s career; it encompasses all forms of self-development. I encourage anyone and everyone to comment on my posts and start a conversation. I am excited to start this blog and I look forward to the journey.

Spencer