Category Archives: 1

Small Brands vs Big Brands in the CPG Space: How to Cleverly Outdo the Complacent Mammoth

By James D. Roumeliotis

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Using the CPG (Consumer Packaged Goods) brands as the main topic for reference in this editorial, we dig into the dilemmas of the leading consumer brands such as Kellogg’s, Nestle and General Mills to name a few in the food sector.

Small, nimble and niche brands, most notably start-ups, are beginning to chip away at the market share of many leading consumer goods firms. As a result, these small companies are growing rapidly to the detriment of the big brands but to the benefit of the consumers. This has to do with big brand complacency, bullying and arrogance along with the desperate need for short-term results to satisfy the insatiable expectation their shareholders’ have for quick profit and stock price increases – but with little regard for today’s consumer. As such, it is no surprise that shoppers have become more savvy, see through much of the nonsense and have helped turn this tide whereby. Consumers trust and are more confident with the small brands over the traditional ones their parents were accustomed to.

Welcome to the new generation of CPG choices and mentality.

Big ship vs Fast Craft

Large well-established companies have several advantages over smaller ones mainly due to their imposing size, their brand recognition as well as for their plethora of cash and human capital. However, despite their deep pockets and plethora of resources, they are risk adverse, bureaucratic in their decision-making process and to some extent, disengaged from their customers. Moreover, if they are a public company, their initial allegiance is to their shareholders.

Start-ups and smaller businesses, on the other hand, have less money and resources at their disposal to grow or even compete in the unapologetic and competitive landscape. Yet, the small business is agile, nimble and creative and possess several advantages such as a clean slate, rather than the baggage many large corporations have been carrying over the years, as well as perceived as more trusting by consumers, further engaged with their customers, and a refreshing alternative to the established brands – provided the products offer unique and attractive characteristics.

Be First, Different & Daring

It takes methodical strategic maneuvers and innovation to outdo the established ones. The good news is that many small companies seem to be doing a good job at both. As a result, they are becoming quite appealing by both consumers and the large brands respectively. At some point and under certain criteria, the latter are keen to purchase the small niche companies.

A case in point is the state of the exploding snack bars health food category. According to Euromonitor International, a market research and analysis firm, renowned food companies such as Kellogg’s and General Mills are experiencing declining market share as compared to previous years. Meantime, privately held Clif Bar, gained a one percentage point during the same period, while another small competitor, Kind LLC, increased its share by 2.1 points. Not idly standing by, last year, Kellogg’s purchased seven-year-old RXBar for a whopping $600 Million, while Mondelez International, the food conglomerate, which owns the Oreo brand of cookies and Cadbury chocolate, purchased Enjoy Life, a consumer packaged goods upstart which performed three years of 40 percent consistent annual growth. A 2015 report from Fortune magazine found that in 2014, in a single year alone, major CPG brands lost $4 billion in market share.

Reputation seems to be the culprit for this significant market share loss. Consumers perceive products from large brands as unsustainable, as well as less healthy with inferior and artificial ingredients along with a high content of sugar and salt. Younger generations of consumers are also suspicious of major corporations. For example, a 2015 study, conducted by the research firm Mintel, indicates that 43 percent of millennials do not trust traditional food companies.

The single most important advice here is that newly established brands should focus on their unique strengths to win over their large and deep pocketed competition rather than trying to go head-to-head with them. Newcomers to the CPG market are in a better position than large brands in catering to emerging consumer trends such as “clean label”, “free from” and organic/non-GMO foods.

  • Agility

Being a small company give you the benefit of being nimble and efficient in areas large ship like companies are not able to do so. This makes them slower to respond. In fact, there are times that they don’t even return calls or email inquiries. Strat-ups can implement a business model which provides value to customers while simultaneously building a lean operation which will yield a consistent profit. This can be accomplished with a limited financial capacity.

  • USP with a Niche Focus

Unlike the big companies, smaller ones can develop products which meet an unmet need. A niche market can demand a premium price which can yield respect along with a handsome profit. For large companies to offer niche product may risk cannibalizing their own existing products.

Increasingly, mass-market retailers are seeking niche brands that their clients consider as healthier. This will keep their customers from purchasing products in this category elsewhere as these large mainstream food retailers face rising competition from natural food and specialty chains such as Whole Foods Market and Trader Joe’s.

  • Trust and Transparency

Regrettably, established food companies do not practice what they state over their PR megaphones. A recent Forbes article contends, those large brands mislead consumers by giving an impression of a healthy product through their misleading labels. Consumers today are well informed and can recognize inauthentic brands, but it seems that short-cuts and short-term thinking, in the name of profit margins and increasing share prices, take precedence. According to AdAge, consumers are increasingly switching to smaller CPG companies as they are perceived as healthier and more authentic.

  • Media Spend on a Budget: Creative vs. Outspending

With a limited marketing budget, the most effective methods of reaching your target audience and to out-create your large corporate competitors is through social media, including reaching out to influential bloggers with a large audience, coupled with a select number of sponsorships and the use exposure of marketing posters, brochures etc. for maximum exposure.  The key to compelling content is to make it about your niche and  your story. If you sell good quality products and have managed to build a good online network of brand supporters, you can leverage your goodwill to bring in sizeable sales.

In a Nutshell

As change is and should be constant, the small brands should not only learn from all the mistakes made by the big brands but also offer what the consumer demands…clean ingredients, transparency and personality along with a story and an emotional connection. These elements exude confidence and trust. Moreover, smaller companies should remain nimble, use plenty of experiential marketing and continuously offer timely improvements including environmental sustainability.

Established brands please take note as you are on notice.

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Filed under 1, Business, business management, cpg branding, decision making management, Food business, inept leadership, inept management, management

Product Features vs Benefits: The Brand Differentiation

By James D. Roumeliotis

What is in it for me - features vs benefits

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There was a time when brands and their sales staff would tout the features of their products. This was most notable with consumer products and automobiles amongst other goods. “Our product has this and that” and “Our product will do this and that for you.” sound alike, but are distinctly different. In this day and age, the second one wins over customers by a long-shot.

Take the case of buying a watch. The function of a watch is to tell time. All watches do this. To differentiate, a watchmaker must bring something else to the table. For example, the Rolex Submariner has many outstanding features. Watch fanatics can recite the details like kids cite stats of baseball players. However, most clients want to feel elegant. They already know that a Swiss watch means high quality. The benefit of wearing a Rolex is to make the wearer feel like James Bond or Gianni Agnelli. The benefits are is style, class, and self-esteem.

People Buy Benefits Rather Than Features

Features of a product are considered a ‘good to know’, whereas its benefits are deemed more relevant to its users as “what I can relate to and need to contributes positively to my sense of self” sell not only the product, but the “idea” of the product. Since there is competition with virtually every product, brands should create interest to more than practical needs of potential customers. The brand’s product(s) must persuade customers to think that it/they perform better and offer a much better value than the competition. For example, Hyundai’s Genesis, through its advertising and sales consultants, stress ‘intelligent value’ when compared to the established premium auto brands like Mercedes, Audi, BMW and Lexus. The emotional benefits are what a brand/product ought to be targeting and appealing to. This would make the driver feel as if he/she has made financially and emotionally a wise decision.

As marketers are quite familiar with the term “sell the sizzle, not the steak”, in layman terms, it signifies that you’re not only selling the product, but the idea of the product.

What is Your Brand USP? Benefits Must Be Tangible

To begin with, a “Brand” is a promise of something that will be delivered by a business. A brand promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. A major part of this is what’s called the “Unique Selling Proposition” or USP.

Prior to launching or invigorating an existing product, the questions which should be asked are:

  • What is our purpose?” and as a result: How is our target market going to benefit from our product?
  • What will the brand and product stand for? How are they going to be positioned?
  • What is the product’s intrinsic value? Perceived value?
  • Is it going to be a lifestyle product?

Simon Sinek takes the aforementioned a step further with thought provoking questions. An accomplished author and adjunct staff member of the RAND Corporation, one of the most highly regarded think tanks in the world, in his popular talks worldwide, including TED, compellingly emphasizes the following:

Why does your organization exist? Why does it do the things it does? Why do customers really buy from one company or another? Why are people loyal to some leaders, but not others?  Starting with “why” works in big business and small business, in the non-profit world and in politics. Those who start with “why” never manipulate, they inspire. And the people who follow them don’t do so because they have to; they follow because they want to.”

Alternatively – Sell a Lifestyle and an Experience

Generally speaking, brands that are designed for a lifestyle should have a much higher emotional value to consumers than ones based on features like cost or benefits alone. Brands also build relationships by the stories they tell. Stories add personality to products which customers can better relate to and feel affinity with. Luxury brands boast their pedigree and craftsmanship, amongst others.

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. The most ideal example is when thousands of people line-up, regardless of weather conditions, to get their hands on the latest iPhone or any new product launch such as the imminent iWatch. This happens because Apple has built an emotional attachment to their products by creating a lifestyle choice rather than a product purchase.

It’s about how it makes you feel. Same goes for baby boomers, whether accountants or attorneys or business executives who purchase a Harley Davidson motorcycle and ride them for about four or five hours every Sunday afternoon. The bike makes them feel like a rebel – sort of an escape.

A brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based on features like cost or benefits alone. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Features vs Benefits

The Final Take

If your product stands-out on its own because it functions splendidly and enhances its intended purpose, then it can’t help but be embraced by consumers without the artificial hype. It’s what they will talk about to others which is the most candid endorsement the product can earn. It’s equally important to sell the idea of a product as it’s to sell the actual product.

The key to success is to market your brand, not your product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with your customers. Branding positively adds value to your company including brand equity. This is considered intangible brand value.

A company can define itself as a lifestyle brand when its products promote a more than a product with key benefits and attributes. Note however that lifestyle branding is more than just promoting “a way of life.” It is a product or service that provides consumers with an emotional attachment to the brand.

One way to overcome the ‘price only’ differentiation, which erodes profits and does not generate loyalty, is for a company to consider building a lifelong relationship with each customer. To do so, requires that each customer enjoys a positive and hassle-free transaction with each touch point consistently every time.

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Ambiance Marketing: A multi-sensory approach to attracting and retaining clientele

by James D. Roumeliotis

Sensorial marketing

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The dictionary conveys to us that “ambiance” is “the character and feeling of a place.“ A place which wants to attract the most discerning souls, should be unique and embody a complete lifestyle concept which combines a relaxed, spiritual ambiance amongst an elegant setting and decor with attention to detail. Staging an impressive, well executed upscale event, such as a product launch or promotion takes creativity, organizational skills, as well as savoir faire.

Pleasing hors d’oeuvres and drinks prepared and presented with pizzazz are complemented by soothing music which is also an integral part of the ambiance and ranges from classic music to smooth jazz or chill-out rhythms. The attractive, smiling and well mannered staff is dressed stylishly.

All of these elements combined will, undoubtedly, seduce the senses and generate good vibes along with positive memories created. This principle applies equally well to business establishments and brands and includes boutique hotels, restaurants & bars, fashion boutiques and other upscale business establishments. In marketing, a multi-sensory approach is proven to increase sales.

To be effective, the use of an integrated approach is essential across various touch points with the purpose of engaging customers.

Today, consumer purchase decisions are increasingly driven by consumers’ hearts. With ambiance marketing, a custom designed attractive setting – yet alluring with captivating style, invites customers to truly feel the brand experience by adding character. This is accomplished by connecting the emotions to a product or service, and infusing it with a tangible and intangible essence that remain in the customers’ minds.

The ambiance you create is one of your best marketing tools. The aesthetic appeal to human senses, the feel of your business and the brand you create is your image. Along with great service, it is one of the most important reasons customers will choose you over the competition.

What should you consider when developing ambiance?

In keeping with the spirit of our five senses, you can exploit them entirely to create a favorable experience in synergy, for guests and clients alike. Below are some of the most important factors:

SIGHT – choice of lighting, décor, colors and an ergonomic layout. You can get a real sense of movement using these elements. Lighting is also very helpful when it comes to the overall event and low intensity lighting such as dimmed soft halogen or LED lights along with the presence of lit candles create a stress free atmosphere. In addition to your building materials and lighting, the art you choose to put on your walls will make a huge impact on overall ambiance. Local art, modern art, renaissance art or a hodgepodge of all of them will help convey the ambiance you are trying to define.

LISTEN – music, effects, volume and vibrations. The tone and the energy of the room can be set with the right music selections. Think about using a “signature” sound effect to draw attention to different happenings throughout establishment or event. Upbeat music that would be appropriate in the evening may not appeal to your morning customers who have just gotten out of bed. If you have an Italian-themed bar, you may want to interject some Italian music from artists like Zuccero or Eros Ramazotti. If your theme/branding and ambiance is geared to a very hip, young audience, it will likely suit your customers to include songs with a driving beat from cutting-edge alternative and electronic artists.

TOUCH – textures and comfort. This is all about how your guests and/or clients interact with the environment. Plenty of emphasis should be placed on this when designing the layout. It should be ergonomic. The more comfortable the space, the longer guests/clients will linger in any given area. The materials you use to build out your operation will be a major component of the ambiance of your business and the choices are many. Countertops can be granite, frosted glass, laminate or of exotic wood. Floors can range from acid-etched concrete to terrazzo to granite. The use of wood can evoke a feeling of warmth. Exposed pipes and air ducts can give your business an industrial feel. Draperies can dampen sound and add texture.

TASTE – finding the perfect balance between sour, salty, sweet, and bitter during menu designs and beverage selections with the intention of pleasing most taste buds. Presentation is equally important which has an impact on the overall image of the setting.

SMELL – it is all about fragrance which aids in creating emotion. This sense is usually neglected yet of all our senses, the sense of smell is closely linked to emotion and memory. You can use something as simple as burning incense or candles to something far more complex like computer controlled scent machines to enhance your environment. This could just be the icing on the cake, sort of speak, in complementing the overall mood. If it is a French bakery café style of operation, the smell of roasted coffee and baked items sold will induce clients to make and increase their purchases.

A case in point in terms of a successful establishment, which implemented the above principles spot on, is a popular upscale “member’s only” bar in Dallas, Texas called “Candleroom”. It did not become renowned simply by accident. This has been accomplished by developing and executing the perfect atmosphere for young professionals seeking to socialize in a dramatic and spacious setting – a progressive urban lounge modern in design and decorated with bold, sensuous colors. The ultra swanky décor with its velvet, leather and fine furniture are lit by candles and dimmed chandeliers. DJs spin house, rock, hip-hop and dance for those that are interested in a little more of a dance club setting, while the attractive staff working behind the bars mix exotic drinks for the patrons. As a result, it is considered by many discerning clubbers to be one of the most handsome drinking destinations in Dallas.

Focus groups: Uncovering your customers’ specific desires for your success

As companies grow larger, they commonly hire a market research firm to determine what their customers like, dislike and what additional products or services they desire. This is often uncovered through the use of focus groups.

There is no reason you cannot poll customers in your area in the same way large multinational companies do with great success. Focus groups can be helpful if you are already open or just beginning to plan your business. Rather than simply assuming, it is in your best interest to know if you are giving your customers the products, services and ambiance they desire. Feedback is important, hence you need to find out what your customer’s needs are and fulfill as many of them as possible. After you analyze the information you have received from your focus group, try to incorporate the best and most workable ideas into a motif that will define your business and create the ideal ambiance to attract and keep your customers.

On a side note: Branded CD compilation

Designing and implementing custom music and visual strategies that emotionally anchor a brand to its clients, should be considered. The goal of branded CDs is to turn your listeners into disciples of your brand. Every aspect of your custom CD says something about your brand, therefore, custom CD’s place equal importance on print, media, and visual elements in addition to the music. Specialty music compilation companies such as Sonodea and Custom CD Corporation oversee all logistics related to custom branded CD music compilation and development. They work closely with clients on everything from the music themes to the packaging to the visual content. This ensures that the music, look and feel of the CD resonate with their customers’ clientele and target demographic.

In some fashion, all business is show business and storytelling. Brand image is all about the experience, perception and differentiation you create in the customers’ mind. Ambiance marketing takes all this into meaningful consideration by applying its multi-sensory approach to attracting and retaining clientele to your brand and business establishment.

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Filed under 1, ambiance marketing, auditory branding, brand positioning, Branding, Business, customer experience, Marketing, retail luxury interior design, sensuous brand, sensuous brands, sensuous products, sound branding, sound marketing

Food Distribution Guy interviews James Roumeliotis from Artizan Fine Foods

Sharing an interview podcast I recently had, conducted by a food marketing expert on how I launched Artizan Fine Foods with my partner and what differentiates our products.

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Filed under 1, Branding, Business, competition, entrepreneur, entrepreneurship, entrepreneurship success, Food business, Food entrepreneurship, food marketing, Food production business

Brand Experience, Not Product Branding: Cutting Through the Clutter

by James D. Roumeliotis

Brand Experience

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Products in the same class-categories struggle to differentiate themselves. Consumers often take brands for granted. Purchases are not so much conscious brand selection as choice by default. The two following examples highlight this. Going out for coffee in North America usually dictates a visit to Starbucks. When sparkling water is ordered at a restaurant, Perrier appears almost by magic.

The age of the internet has made copying competitors’ products, marketing strategies, and overall business practices to name a few. It’s not enough to merely compete at a product and pricing level which doesn’t take long to be outdone. Anyone can lower prices. What begs the question is where you draw the line before your profit margins are eroded to the point of no return and many ramifications for a business. Savvy marketers look beyond pricing and product features. Instead, they search for sustained ways to market their brand rather than their product.

“Branding” redefined for the new era

 To begin with, a “Brand” is a promise of something that will be delivered by a business. This promise comes in a form of quality, an experience and a certain expectation in the mind of the consumer. It includes the Unique Selling Proposition (USP). Marketing, on the other hand, is about spreading compelling messages to your target audience while branding is a combination of words and action. Marketing is extroverted and communicates quickly, while branding is introverted and a slow process if it’s to produce any real impact. Effective marketing activities are vital in developing a brand. When combined successfully, branding and marketing create and promote value, trust, loyalty and confidence in a company’s image, products and services.

When consumers are delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation.

A branding strategy should consist of:

  • Brand Positioning – Position is a descriptive sentence, slogan or image the brand is known for in the mind of the consumer and which the company delivers on it consistently. This is what sets the product or service apart from competitors.
  • Brand Identity – This is every visual expression of the brand, whether in print, television, digital or the iconic (Pullman) brown color identifying the trucks and delivery staff of the UPS courier company.
  • Brand Experience – Generally speaking, brands that are designed for a lifestyle should have a much higher emotional value to consumers than ones based on features like cost or benefits alone.
  • Storytelling – Brands build relationships by the stories they tell. Stories add personality to products which customers can better relate to and feel affinity with. Luxury brands boast their pedigree.
  • Engaging with your target audience – this is conducted through social media and asking for feedback. Simply put, engaged customers help you build your business.

The holistic selling proposition

Consumers today are more brand conscience, yet there are companies which continue to spend money advertising and selling product rather than brand. They place emphasis on price and quality as differentiators despite these two being overused by many copycats. Successful brands take a holistic approach to selling by exploiting the 5 senses which now constitute the brand. This is accomplished by what I regard as “ambiance marketing” and “sensory/sensorial branding”, through a captivating designed setting, yet alluring. This adds character and invites clients to truly feel the brand experience.

To put the aforementioned into perspective, consider the following:

  • Visual – lighting, décor, colors, layout…you can get a real sense of movement using these elements.
  • Auditory – music, effects, volume, vibrations…you set the tone and the energy of the room with your sonic selections.
  • Tactile textures, comfort, climate…this is all about how your guests interact with the environment.  This is a big thing to consider when you are designing the layout.
  • Olfactory fragrance, emotion, ambiance…this sense is under-rated and powerful. Of all our senses, the sense of smell is most closely linked to emotion and memory. You can use something as simple as burning incense or candles to something far more complex like computer controlled scent machines to enhance your environment. This could just be the extra touch needed to set the mood.
  • Gustative – with food establishments, the challenge is in finding the perfect balance between sour, salty, sweet, and bitter during menu designs and beverage selections.  The presentation also makes an impact on the overall image.

Customer Experience equals customer abbreviation

Developing the customer relationship through customer experiences

The Total Customer Experience is the sum total of the interactions that a customer has with a company’s products, people, and processes. It goes from the moment when customers see an ad to the moment when they accept delivery of a product and beyond.

According to Bain & Company, a leading management consultancy firm, out of 362 leading companies surveyed, 80% believe they deliver a superior customer experience, but only 8% of their customers agree.

The experiences customers go through with your business determine the ultimate perception of your brand and image. Customer experiences also spread the word (offline/online) to others (friends, relatives etc.) about your brand/image. That said, each customer contact (“touch points”) should be handled with the utmost care to ensure that the total brand experience a person has is constant. This requires proper training and occasionally evaluating employee performance. Moreover, improvements may be necessary with systems, technology, methods, services, products and even physical premises. Complacency should be replaced with continuous improvement.

Creating a lifestyle brand through emotional attachment

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. The most ideal example is when thousands of people line-up, regardless of weather conditions, to get their hands on the latest iPhone or iPad. This happens because Apple has built an emotional attachment to their products by creating a lifestyle choice rather than a product purchase.

It’s about how it makes you feel. Same goes for baby boomers, whether accountants or attorneys or business executives who purchase a Harley Davidson motorcycle and ride them for about four or five hours every Sunday afternoon. The bike makes them feel like a rebel – sort of an escape.

A brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based on features like cost or benefits alone. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Lifestyle brands have gained an increased share of the luxury market such as BMW, Armani, W Hotels, Louis Vuitton and Rolex ‒ just to name a few. These have given way to consumers to buy products that they associate with a “luxurious life.” They are essentially a status symbol.

B2B branding differentiation

Consumers are attracted to brands’ nonsensical benefits such as status, affinity, self-comfort and prestige, whereas, Business-to-Business (B2B) customers make their purchase decisions based on practical rationale including pricing, product performance and specifications, Moreover, brand loyalty in the B2B sector is higher than in consumer goods markets because companies in the commercial and industrial segments seek satisfying and long term relationships since jumping from supplier to supplier can cause havoc and inconsistencies with product quality control. Consequently, developing brand loyalty among enterprise customers can capture a larger share can increase profit margins while protecting them against lower-priced competitors.

The final take

The key to success is to market your brand, not your product. Contrary to popular belief, a brand is not a logo, label or product but rather a relationship with your customers. Branding positively adds value to your company including brand equity. This is considered intangible brand value.

A company can define itself as a lifestyle brand when its products promote a more than a product with key benefits and attributes. Note however that lifestyle branding is more than just promoting “a way of life.” It is a product or service that provides consumers with an emotional attachment to the lifestyle of the brand.

One way to overcome the ‘price only’ differentiation, which erodes profits and does not generate loyalty, is for a company to consider building a lifelong relationship with each customer. To do so, requires that each customer enjoys a positive and hassle-free transaction with each touch point. The goal is also to reduce or eliminate customer problems altogether, but that begins prior to and during the first contact with the customer. All problems should be documented, reviewed and corrected without much delay. Hiring the right people is vital, so is training them properly, as well as empowering them to deliver a remarkable customer experience.

When promoting brands, consider that earned media trumps paid media and enhances the brand image. With adverts, consumers don’t care what marketers say. According to a 2015 Nielsen Group report, “False” is the term 89% of consumers closely associated with advertising campaigns.

Whether a product or service ‒ is a luxury brand or falls into another category, it is how you stand out from the crowd that distinguishes you. Know your target audience, get inside their heads and understand how they think and feel. What are their fears, emotions and anxieties? Once you’ve understood this quite well, you then manage the brand consistently.

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Filed under 1, brand equity, brand positioning, Branding, branding not products, Business, marketing strategy

Shady and Dysfunctional Enterprises: Deceit, Greed and Short-sightedness in the Name of Profit and Market Share

by James D. Roumeliotis

Dysfunctional Company Hierarchy

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Businesses of all sizes normally develop various pain points. A seasoned entrepreneur has actually made a list of 100. In the end, pain is a motivator for action to turn things around. However, the key is in how to tackle each one and in a timely manner. Better yet, how many of them are ever anticipated — and as a consequence solutions readily available? What is not anticipated are repercussions from poor decisions made or deceit deliberately caused with or without knowledge from company authorities. As a result, denial sets in from the top with accountability being dismissed.

Needless to say, chaos reigns within organizations which for many results in bleak outcomes. Within, there is a lack of communication, trust, transparency and loyalty. Not a sincere and astute way to operate a business.

By all appearances, there are plenty of executives who are simply results driven at the expense of their customers, employees as well as with their vendor relationships. Remarkably, most of those companies are publicly traded.

Corporations lack trust from consumers

A survey conducted by JUST Capital’s of more than 40,000 U.S. participants and groups indicates that the nation’s largest corporations are “going in the wrong direction.”

Overall, only 41 percent of all Americans trust corporations “somewhat” or “a great deal,” while 50 percent of more conservative Americans trust corporations.

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Source: http://justcapital.com/research

The cause of distrust among consumers can be rationalized due to corporations misleading the public as a whole, as well as their shareholders. Deliberate misleading information by food producers in regards to nutritional benefits and nickel-and-diming by airlines, hotels and banks are causes for frustration, suspicion and loathing.

Sectors notorious for constant price gouging coupled with despicable service include, but not limited to, a select number of pharmaceutical brands, banking/financial services, cellphone service providers, cable companies, large food brands and airlines. Too add salt to injury, in the U.S. and Canada, pointless aggressive lobbying efforts by various industries yield their influence by means of generous contributions to political parties. They are also infamous for spending a ludicrous amount of money producing sly ads and propaganda which go against consumer wishes. Consider the soda lobbyists who, according to a NY Times article, “made campaign contributions to local politicians and staged rallies, with help from allies like the Teamsters union and local bottling companies. To burnish its image, the industry donated $10 million to the Children’s Hospital of Philadelphia.” Sadly for consumers and the city of Philadelphia, the tactics worked. Similar outcomes occurred in New York City and San Francisco. In the end, the soda industry’s rubbish of an astonishingly high calibre, comes as it does from the same producers of fatty chips to the semi-literate masses. Shameful practices include the deceitful marketing of chemically-calibrated and engineered to simply taste good processed food products that are making its mainstream market obese, thus unhealthy.

In certain types of large scale B2B transactions, there can be scope for unscrupulous behavior. One or both parties are tempted to forego ethics in favor of making the deal. Such relationships inevitably end badly because they are either uncovered by authorities, as well as not conceived with trust or respect.

Then there are the occasional devious companies that will do what it takes in the name of revenue and profit ─ disregarding authorities, customers and everyone who takes their trust for granted. Volkswagen’s blatant rigging of emissions tests with over 11 million of its diesel cars sold globally, 482,000 of which are VW and Audi brand cars in the U.S., is an ideal case in point. As a result of its mischievousness, the company known for its hard core corporate culture caused a great deal of damage to the environment. Their supposed clean diesel models have been spewing up to 40 times more smog-causing nitrogen oxide pollution. The recall is one example of a deliberate act gone terribly awry for a brand which wholeheartedly masterminded it with self-admission. Rather than sacking the CEO Martin Winterkorn, under whose watch this scandal occurred, and depriving him of his golden parachute, the supervisory board allowed the septuagenarian, Mr. Winterkom, to conveniently step down and take home a lucrative compensation package.

contact this author for his pragmatic and practical approach.>

Corporate governance or lack thereof

The term “Best practices” is not merely words but deeds. What is required is an efficient implementation of strategies, quality controls and delivering more than lip-service. Evidently, it is not easy, otherwise, many more businesses would be performing admirably.

To understand and penetrate the corporate governing structure and “culture”, you need look no further than the upper echelon of the hierarchical tree. It is where procedural decisions are shaped and executed. One would think and expect an entity’s leadership to head the enterprise by governing its long-term growth and sustained wealth. Conversely, there is a constant search for the “ideal” human resources. Recruited and fresh talent must resemble the leadership in tone and style. Call it the organization’s DNA. Exceptional organizations are good at these types of corporate strategies, thus strengthening performance effectively.

In the end, leadership ought to foresee and prevent any potential scandals, apply checks in balances, inspect what is expected, keep corporate structure layers to a minimum, and keep communication channels open.

Customers first, employees second — investors third

In the ivory towers of public corporations, the CEO and board of directors have been programmed to put their stakeholders best interests above all else. Their mission is to do what it reasonably takes to deliver quarterly results ─ in other words, to focus on the short term rather than sow the seeds and do what is most beneficial for the future direction of the company ─ despite any short term pains. Savvy and considerate top management know better that customers and employees are the two key drivers of corporate success.  The main principle is that if employees have a positive attitude, are passionate, well trained and competent, results will be reflected through positive customer experiences resulting in brand loyalty. Ultimately, the shareholders will reap the benefits through stock performance and generous dividend distributions.

Jack Ma, the founder and executive chairman of Alibaba Group, a family of highly successful Chinese Internet-based businesses, made a public statement which may have surprised the investment community. He publicly stated that, “Our customers come first, our employees second, and our shareholders third.”  The highly regarded membership-only warehouse club COSTCO performs actions consistent with one’s claims as they too follow Jack Ma’s mantra. The impressive financial results year after year speak volumes as they retain the best intentions of their employees and customers.

It took Amazon quite long to finally earn a profit since its inception. Founder Jeff Bezos and his senior executive team dug in their heels despite outcries from many of their shareholders for continuously making large capital investments with no profits in sight. For a while, plenty of cash was spent for IT related infrastructure including Cloud computing and everything related to giving the company an edge over the competition. Customer service and the customer experience have been priority no. 1. In the end, shareholders who lingered learned that patience with their investment in Amazon is a virtue in the long run.

The attitude of the individuals in the boardroom had better be that if investors are impatient and eager for quick monetary results, they can take their money and invest it elsewhere.

Advice for start-ups: ‘Steady as she goes’

A well-oiled operation should consistently head steadily on its current course regardless of any obstacles that get in its way.

Research by the U.S. Bureau of Labor Statistics reveals that nearly six out of 10 businesses shut down within the first four years of operation.

To be a successful entrepreneur is not an effortless task. It takes plenty of sacrifice. A new generation of young entrepreneurs think the road is smooth and a fast track to easy wealth. Not everyone will become Mark Zuckerberg. Obstacles and sacrifice are part of the deal. Harnessing opportunity and overcoming challenges on a daily basis to top the competition is constant work. These conditions are true no matter what the sector of business engagement or company size.

Telltale signs of weak organizations can be traced to inept leadership. The following points highlight the deficiencies:

  • Poor customer service – slow or no customer inquiry replies – abysmal handling of sales and service complaints. Service is portrayed as a reward, not a right or benefit.
  • No Unique Selling/Value Proposition. Companies need to define and articulate their unique value proposition and deliver on it consistently. Create the platform for sustainable and competitive advantage.
  • Operational deficiencies – various ailments and no structure
  • Absence of or very little communication among staff and management. Divisions aren’t well-coordinated and do not function as a team.
  • No transparency. There is hardly any openness from management.
  • Unethical practices – short-term selfish objectives in search of market share. Top executives should promote social norms and principles as moral agents.
  • Lack of proper execution of decisions and with new products/services.
  • Productivity incentives should be implemented to boost results and employee morale. People must be given a reason to work hard and be efficient.
  • Creativity is practically non-existent. An absence of innovation and employee empowerment will hurt progress and stifle new ideas.
  • No clear vision/strategy – there needs to be a strategic vision that reflects a truly unmet need and has the commitment of a dedicated CEO. That means that there is a well-defined target audience with a distinct value position that is differentiated, meaningful, and deliverable.
  • A weak sales force along with an unattractive compensation plan.
  • Favoring nepotism and bias – promoting family members over other qualified employees often leads to resentment or, worse, prompts valuable non-family employees to leave the company.
  • Poor hiring practices – should hire for attitude and train for skills.
  • Slow/delayed decision-making process – too many layers – overwhelming bureaucratic structure.
  • High turnover, which leads to poor employee morale, reduced intellectual capital, lower service levels, higher operational costs and decreased productivity.
  • Management in a state of denial about their organization’s shortcomings – remaining with the dysfunctional status quo
  • No channel strategy. Some companies focus on building a product, but don’t think through how to get it into the hands of customers. Even if your product is great, unless you can sell directly, you may be dead in the water without strong channel partners.
  • The hidden game – corporate politics – power plays by a handful of individuals for their own benefit to the detriment of their colleagues and the company.
  • Misrepresentation of brand(s) – too much hype – empty promises – not delivering on expectations – leads to dissatisfied clients who will alienate the brand.
  • Weak financial controls – cash flow dilemmas – over leveraged/undercapitalized (high debt-to-capital ratio) – not reinvesting a certain percentage of profits for future growth.
  • Absence of sound marketing program(s) and/or brand strategy. A brand is defined by how it behaves, from the products it builds to how it treats its customers, to the suppliers with whom it works.
  • Growing too fast and not staying on course as the company grows.
  • Lack or very little employee training & development.
  • Deficient in control systems – reactive rather than pro-active.
  • Lack of continuous improvements or complacent.

In the final analysis

In large corporations, the Boards should be held more accountable by paying closer attention to the behavior and actions in the C-suite ‒ thus reacting before things go awry.

The top executive’s job is to operate a business that adds value by means of the goods and services it provides to customers.

The way to solve an organizational problem is to confront the structural issues with a moral sense of purpose and ethics. Higher morale generates higher profits – though occasionally other priorities undermine that objective, for example, self-serving behavior by certain executives or chasing short-term selfish objectives in search of rapid market share, profits and self-interests before people. Monsanto’s executive conduct would make for a marvelous case study in this regard.

According to marketing maven Seth Godin, “It’s the flameouts and the scams that get all the publicity, but it’s the long-term commitment that pays off.”

Wish list of best practices should include but not limited to:

  • avoid potential scandals;
  • apply checks in balances in place;
  • inspect what is expected;
  • trust but verify;
  • retain corporate structure layers to a minimum, and
  • keep communication channels open.

In the end, what you manage and how you manage it is what you get — methodical, sustained growth with patience and lack of greed.

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This Blog’s Top 10 Most Read Articles of 2017

The ten most read/popular articles in this blog have been rounded-up — this time for 2017.

Thank you for your readership and much success to you this year.

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1] The Art of Selling Luxury Products: Brand Story Telling & Persuasion

2] Luxury vs. Premium vs. Fashion: Clarifying the Disparity

3] Exceeding the Hotel Guest Experience: Anticipating and Executing Desires Flawlessly

4] Mass Customization & Personalization: The Pinnacle of Differentiation and Brand Loyalty

5] Perceived Quality: Why Brands Are Intangible

6] Brand Awareness: the influence in consumers’ purchasing decisions

7] Exploring the Luxury British Automotive Total Customer Experience: Part 2 ‒ Jaguar Cars

8] Start-up Essentials: A Universal Roadmap for Starting a Business — Infographic

9] Genuine Luxury vs Accessible Luxury: Two Distinct Yet Opposing Categories

10] Sex and Sensuality in Advertising: Why it is effective and how to refine it

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Identifying and Catering to the Discerning Consumer: Quality and Service Above All

by James D. Roumeliotis

Customer service - white gloves and tray

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During my days in the mega yacht charter industry, I recall dealing frequently with assertive clients who were judicious with their expectations and utterly demanding with their occasional extraordinary requests. As a case in point, a VIP couple was cruising on a chartered mega yacht in the Aegean Sea and during one morning, unexpectedly, insisted that an additional stewardess be brought on board to increase the service level. He also requested five cases of Louis Roederer Cristal champagne. Despite the minor challenges, both requests were fulfilled within a few hours. My staff and I arranged for a stewardess to be flown in from Athens to the island where the yacht was docked that particular day. As for the champagne with its limited supply, I couldn’t locate all the quantities from any major purveyor in Athens. Consequently, I secured the remaining cases from Salonika – a city 188 miles (304 km) north of Athens. All five cases were eventually delivered to the yacht on the same day. It goes without saying that the client was elated.

The “discerning”, also referred to as the “discriminating” consumer, is characterized as showing careful judgment and savvy especially in matters of taste and judgment. This person is finicky and possesses an acquired taste habitually for premium products and services. Essentially, he/she falls short of a compromise. Going above and beyond the call of duty to meet and, at times exceed, expectations is an important principal to apply.

James - Looks like me in this photo

An Inside Look at the Discerning Consumer

More often than not, the discerning client typically possesses a high net worth. This translates to owning financial assets not including primary residence) in excess of US$1 million (source: CapGemini, “2017 World Wealth Report”). High net worth individuals (HNWI) cherish their time and know what they want, to such a degree that they would rather spend their funds for efficient results than waste the limited resource of time. They value time as a luxury, thus saving time greatly trumps saving money. This is part of the reason service is crucial for them.

In a nutshell, the discerning client can be generally described as:
– To a greater extent, belongs in the “affluent” (an investor with less than $1 million but more than $100 000) and “HNWI” (in excess of $1 Million) category;
– Seeks a higher and exacting standard with a minimum set of expectations;
– Fussy in nature;
– Values his/her time;
– Often requires customized solutions to mirror his/her lifestyle – whether a product or service;
– Takes pleasure on getting extra attention;
– Expects to be offered unique choices and experiences;
– Desires value for money under all circumstances;
– Synonymous with a taste for luxury with pedigree and craftsmanship which he/she is willing to pay for;
– Aspires an aura of exclusivity;
– Craves an experience heightened by exceptional service along with a personal relationship;
– Seeks products which are different and more sophisticated – whether it’s apparel, electronics, food or insurance.
– Wants to feel in command of his/her purchase decision without any buyer’s remorse.

Moreover, what he/she purchases is a visual extension of his/her personality, individuality and lifestyle. A well crafted product, for example, reflects his/her individual call to beauty.

Discerning vs. Demanding

There is a clear distinction between a “discerning” client and the “demanding” type.
A discerning client is one capable of good judgment. This client will typically:
– Appreciates the difference between quality and quantity;
– Carefully considers what his/her requirements and needs are and be able to prioritize them;
– Value good service and products, and acknowledge them;
– Be able to judge which consultant can be trusted and be relied upon to do great work;
– Understands that there are other clients and other priorities beyond himself/herself and his/her own.

Thus, the discerning client appreciates what is really required and feasible to obtain, understands the concepts of quality and function, and appreciates the value of good products and services.

On the other hand, a demanding client is one that could, in the worst sort of instance, be summed up by the word “demand.” This type of client could typically display one or more “imperfections”, for example:

– Simply wants everything he/she feels he/she wants or needs to be done;
– Wants everything done promptly;
– Persists in making additional requests for further work (products, changes, etc.) while reluctant to consider the issues of impacts on other factors of function, schedule, cost or quality;
– Expects a lot of attention on demand;

Hence, the demanding client expects plenty, regardless of the true value of it, whilst failing to properly appreciate core concepts such as quality and value. Additionally, his/her behavior is typical of someone who is self-centered and selfish.

Catering to the Discerning Client

It takes skill, patience, resolute and a good understanding of needs to cater to discerning customers – most notably in the luxury sector. It takes an even greater effort to keep them coming back repeatedly.

To succeed in gratifying the seemingly sophisticated client, the organization should develop a comprehensive strategy along with efficient implementation tactics. These include:
– Having a clear and unique value proposition that hooks them;
– In retail and hospitality sectors, exploiting the five senses to attract and retain them – categorized as “ambiance”/”sensorial” marketing and branding;
– Staff must be customer centric, patient, empathetic, and good listeners – remaining calm under duress during client interactions;
– Employee retention – hiring for attitude and training for skills;
– Utilizing a hands-on approach;
– Probing clients’ specific needs/requirements – know their motivations;
– Earning their trust and confidence;
– Offering a personal touch – individualized attention with customized solutions;
– Being frank and transparent with pricing, offers, proposals and promotions;
– Proposing an expansive product selection and service options;
– Outstanding and consistent levels of customer service throughout the organization;
– Reducing or eliminating waiting times – whether on the phone (reservations, customer service etc.), as well as for service or an appointment at the physical location;
– Offering customer loyalty programs – a great way to make them feel special and that they’re getting something extra;
– Asking for feedback with regards to service and product experiences and ways to improve those experiences – they’re typically strongly opinionated and relish giving it;
– Implementing the latest technology with all touch points (where applicable).

In addition, keep your brand offerings constantly refreshed. Give discerning customers a reason to repeatedly do business with you. Macy’s in New York, considered the world’s largest department store, underwent through a four year $400 Million makeover. Product is organized by lifestyle to help customers create looks and build wardrobes across categories.

Sell a distinct lifestyle which is what discriminating clients crave and gladly relate to. Be in the forefront of creativity and have all your staff, regardless of department/responsibility, on the same marketing page.

Occasionally, organize exclusive by invitation only events as a patron appreciation gesture. Being invited to an exclusive event makes one feel notable. For example, Italian sports automaker Maserati invited a select number of brand loyalists to a new experience in Europe that gave them the opportunity to sail on-board the 70 ft./21,3 m Maserati sailboat. In addition, they drove models in its current range including the new Maserati Gran Turismo Sport model.

Create/publish an upscale lifestyle magazine, every other month or quarter, which should include noteworthy information on the brand – in an environmentally friendly print format, as well as in digital format. The Bentley motors magazine is a good case in point.

Putting it All into Perspective

Discriminating customers’ purchasing attitudes are based on personal beliefs and taste for finer things in life. They are quite selective, know what they want and aspire to be catered to effortlessly. They seek the total customer experience along with pampering, personalized service and value for money. Some will argue that discriminating customers also consider transacting with companies that demonstrate corporate social responsibility.

A key difference between “discerning” and “demanding” is that the former requires what is important and expects it when it can be reasonably obtained, whilst the latter requires everything regardless of other considerations.

A brand which is involved in the business of offering a luxury and/or premium product or service should be well prepared to cater to a discerning clientele and avoid complacency. As a result, the entity will benefit through repeat business, as well as a word-of-mouth angle, since such customers are likely to tell friends and relatives about their experiences – especially in the world of social media.

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The Sensuous Brand: How to create allure with products and user experience

by James D. Roumeliotis

Sky Vodka - Sexy Brand

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Why are visually appealing products rare which make purchasing it a delight and worth talking about? Common sense dictates that product design should be attractive – perhaps possess sex appeal if the brand behind its product(s) seeks to make a sales impact. Although beauty is subjective, there are common standards of attractive packaging, which are smart and demonstrate the intrinsic value of the product’s attributes.

However, many will agree that smart design looks timeless, expresses character and is visually seductive.

Barring lingerie labels such Victoria’s Secret or Agent Provocateur – which in and of themselves will ooze with sexiness, most other brands and their products from non-seductive sectors can still create and possess a sense of styling along with desire.

A brand that caters to all the senses, begins with an appealing brand identity, followed by creative industrial design of its products – which are complemented with a positive customer experience in every touch point.

Artfully articulating what your brand and offering represent

Adding personality to objects and human interaction are quintessential to customer envy and desire.

There are brands that design and churn sensuous looking products. However, there is one that most will agree is top of mind for the refined consumer electronics market –- Apple. It’s all about the appealing logo, the attractively designed and “feel good” products, the alluring packaging, the intriguing ads, and the overall positive customer experience at their retail level, Needless to say, it’s a contemporary brand that undoubtedly gets it. It’s no wonder it created a strong following, or as marketing maven Seth Godin would describe as a “tribe.”

When consumers are delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying into the brand repeatedly and recommending it to others. This behavior serves to build the brand’s image and reputation.

Product design is key to a great brand. Design is the elemental differentiator with competitors. Allure builds the emotional bond and turns owners into enthusiasts.

“It’s all about integrating design and brand,” says Joe Doucet, founder of Joe Doucet Studio.

We need to cease thinking of them as different disciplines. The essence of the Apple brand comes through its design. Take the logo off a BMW and you still know it’s a BMW.”

Design also needs to be part of the strategic plan from the start, embraced by the CEO and across the Board.

A brand is not your logo or ID system,” says Robert Brunner, founder of the design shop Ammunition and author of ‘Do You Matter: How Great Design Will Make People Love Your Company.’

It’s a gut feeling people have about you. When two or more people have the same feeling, you have a brand. You get that feeling via smart design, which creates the experiences people have with the brand. Everything you do creates the brand experience; ergo design is your brand.

The holistic approach to customer attraction and retention

Consumers today are more brand conscience, yet there are companies which continue to spend money advertising and selling product rather than brand. They place emphasis on price and quality as differentiators despite these two being overused by many copycats. Successful brands take a holistic approach to selling by exploiting the 5 senses which now constitute the brand. This is accomplished by what I regard as “ambiance marketing” and “sensory/sensorial branding”, through a captivating designed setting, yet alluring. This adds character and invites clients to truly feel the brand experience.

To put the aforementioned into perspective, consider the following:

  • Visual – lighting, décor, colors, layout…you can get a real sense of movement using these elements.
  • Auditory – music, effects, volume, vibrations…you set the tone and the energy of the room with your sonic selections.
  • Tactile textures, comfort, climate…this is all about how your guests interact with the environment.  This is a big thing to consider when you are designing the layout.
  • Olfactory fragrance, emotion, ambiance…this sense is under-rated and powerful. Of all our senses, the sense of smell is most closely linked to emotion and memory. You can use something as simple as burning incense or candles to something far more complex like computer controlled scent machines to enhance your environment. This could just be the extra touch needed to set the mood.
  • Gustative – with food establishments, the challenge is in finding the perfect balance between sour, salty, sweet, and bitter during menu designs and beverage selections.  The presentation also makes an impact on the overall image.

Creativity, quality, storytelling and above all, customer experience

Standard products and mundane user experiences don’t offer compelling reasons for consumers to do business with certain brands. If a business can’t articulate its USP (unique selling proposition) ‒ as to why anyone should do business with your brand, your product and/or service merely becomes a “commodity” whose price will be the sole determinant in any transaction.  Being formidable and considered top of mind in your B2C sector requires a philosophy – a certain culture which will develop a following by consumers who share your values.

Quality materials, assembly and final product look increase a company’s competitiveness. The quality of a product may be defined as “its ability to fulfil the customer’s needs and expectations”. If the characteristics and specifications of a brand’s product line are equal or superior to its competitors, along with a fair price-value equation, the brand will turn out to be a preferred choice.

Storytelling, on the other hand, builds relationships by the stories that are well told. Stories add personality and authenticity to products which customers can better relate to and feel affinity with. Luxury brands tend to boast their pedigree since their discerning clientele desire a deeper level of involvement and understanding of the history and heritage of the brand when it comes to their luxury purchase. This is referred to as “experiential luxury.”

It is essential that the sales professional be product proficient and adept at assisting and guiding the client to the purchase making use of flattery, romance and showmanship. To illustrate, when selling a niche automobile such as a Porsche, the sales consultant can talk about racetracks, describe road-holding capabilities, build-up a fascinating story – after which time he/she can bring-up reliability and the technical details which confirm to the discerning client what he/she is already aware of.

When consumers are delighted by a particular brand experience, they begin to bond emotionally with it. They become brand loyalists and advocates – purchasing the brand more often and recommending it to others. This behavior serves to build the brand’s reputation.

Be first, different & daring – above all, visually stimulating

Plan and execute flawlessly the following to differentiate and develop into, as well as remain an enviable brand through artistic design and function:

–       The brand logo and company presentations should possess flair, consistency and be memorable;

–       Focus on a specific target audience/niche market rather than divert to several markets or the general population;

–       Innovative and “feel good” product design (both visually and tactile): Get inspired by designs from Philippe Starck, Pininfarina, Porsche Design and Bang & Olufsen. Architecture by Frank Gehry and Zaha Hadid  Automobile design trends by Audi, Tesla, and in the last few years, Hyundai with its entire model makeup. Kohler Group doesn’t simply design functional bathroom and kitchen sinks and faucets, but rather bold designs and technology to an otherwise lackluster plumbing product sector.

Perhaps product customization and personalization should be available as an additional offering.

–       As for service related domains, place emphasis on employee attitude/personality, empowerment, constant training, effortless accessibility for your clients, flexibility when solving issues and presentations with style, as well as finesse. Each and every customer should be treated with personal care – a sign of individuality;

–       The Total Customer Experience: Be easy to do business with – accessible – at every stage of a transaction from initial contact/pre-sale, during the sale and post-sale (follow-through and customer service). Zappos, Nordstrom, Ritz-Carlton Hotels and American Express (to name some of the finest examples) are renowned for their obsession with customer service and total customer experience;

–       Soothing sounds and striking visuals: Consider sound branding complimented with refined standout visuals (audio, images and video). Surround your brand and its products/services with fashion, beauty, design and attractive models – without any marks of tackiness;

–       Packaging design should be visually appealing, distinctive, tastefully decorated, and equally inviting to open.

–       Sponsor, collaborate and/or associate with a fashion related brand and/or the arts. Both brands can benefit from combined exposure (PR and advertising). Luxury goods brands such as Versace, Bulgari and Fendi are teaming up with property developers to offer upscale designer hotels. Their trademark at hotel properties, in a select number of affluent cities worldwide, offers their loyal clients something new to get excited about.  It’s a collaboration which celebrates a shared fondness in design and luxury experiences.

–       Create and own a captivating name and category for your product or product line. Luxottica, is the world’s largest eyewear company, controlling over 80% of the world’s major eyewear brands (eye glasses and prescription frames) including Ray-Ban and Oakley sunglasses, along with Chanel, Prada and many other designer labels. It re-invented eyewear which were once considered a “medical device” and developed them into a fashion statement. They no longer label their products as “glasses” but as “eyewear” and “face jewellery” (for a lack of a better term/descriptive);

–       Marketing collateral and ads should be: (i) slick, (ii) minimalistic, (iii) emotional, (iv) portray a lifestyle, and (v) apply the “less is more” mantra. Arouse curiosity. Effective marketing campaigns should also include elements of: Imagination, Mystery and Memory;

–       Be a visionary and innovate – anticipate what your sector will look like in 3-5 years and begin to plant the seeds/strategize in a timely manner. Avoid complacency. Blackberry is an excellent case study exemplifying what they should have done a few years ago to remain relevant amongst iPhone and the Android platform smartphones.

Lessons from luxury brands: creating a lifestyle brand through emotional attachment

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. The most ideal example is when thousands of people line-up, regardless of weather conditions, to get their hands on the latest iPhone or iPad. This happens because Apple has built an emotional attachment to their products by creating a lifestyle choice rather than a product purchase.

It’s about how it makes you feel. Same goes for baby boomers, whether accountants or attorneys or business executives who purchase a Harley Davidson motorcycle and ride them for about four or five hours every Sunday afternoon. The bike makes them feel like a rebel – sort of an escape.

A brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based on features like cost or benefits alone. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Lifestyle brands have gained an increased share of the luxury market including prominent brands such as BMW (ultimate driving experience), W Hotels (avant garde designer hotels for a younger audience, along with whatever you want, whenever you want it, as long as it’s not illegal), Louis Vuitton (prestige and opulence), Rolex (representing the pinnacle of achievement; fulfilling and perfection in one’s life) and Aston Martin (power, beauty, soul and heritage). Those brands have given way to consumers to buy their products that they associate with a “luxurious life.” They are essentially a status symbol. Abercrombie & Fitch had once experimented by creating a lifestyle based on a preppy, young Ivy League lifestyle. Their retail stores evoked this lifestyle through an upscale environment, physically attractive models, along with spicy ads featuring young people living the A&F lifestyle.

Hermes Equestrian Fashion Photo

Hermes gets it right with its sensuous ad campaigns

The final take: Elegant & intelligent design

Beauty and design in all things is artistic, engaging, stimulating and creates a sense of comfort. It’s also a very personal thing. Creativity is beauty in art form. It starts from nothing, utilizes mind exploitation, imagination then something awe inspiring is produced which stimulates the mind and senses. The approach to creativity is the way an artist might stand before a new canvas, on which a beautiful painting can be crafted. Staff who work in a creative environment should be given plenty of leeway to utilize their full potential – the freedom to flourish. Not doing so limits their artistic talent and deprives the company from taking a leap at the competition. Apple has successfully unleashed the talent from their product engineers by creating a non-stifling work environment. As for architects and industrial designers, they should definitely possess the talent and imagination to create and turn extraordinary drawings into reality.

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. When Apple releases a new consumer electronic device, people line-up, regardless of weather conditions, to get their hands on the latest iPhone or iPad. This is a result of Apple constantly building an emotional attachment to its products by managing the total user experience.

“Total customer experience” is not an option but rather compulsory as part of an alluring brand. It takes savvy planning, execution and perpetual refinements to stand above the crowd. It’s how you get noticed and remain relevant. Luxury brand desirability is driven by standout design, craftsmanship, as well as what is felt.

It takes vision, creativity and intuition, along with unflagging discipline and a sense of style, to keep a consumer focused company relevant and its products on everyone’s must-have lists. No brand should be complacent.

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10 Pitfalls of Start-ups: How to Succeed Through the Initial Three Years and Beyond

Viewpoint by James D. Roumeliotis

Businessman Taking the Plunge

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Prior to taking a plunge in your start-up, you conduct thorough research, plan meticulously, execute strategy flawlessly ‒ but over time, you barely survive, or worst yet, fail altogether. What gives?

According to statistics, as the latest available numbers from the two U.S. government statistical agencies responsible for providing data about new businesses illustrate, The Census Bureau and the Bureau of Labor Statistics, five years after new establishments were founded (1995, 2000 and 2005 respectively), 50%, 49 and 47 percent of them (correspondingly) were still in operation.

Merely reading a business book, this article, or attending a well-regarded entrepreneurship course/program is no guarantee of success in increasing one’s odds of business success. It takes diligent implementation of a viable business plan, focus, determination, consistent and well thought out action, as well as an obsession with the customer, amongst other traits and approaches. Management of a business is not a science, it’s a practice.

SME/SMB business owners optimistic despite odds of failure

A new, independent survey has found that small and mid-size business owners share several distinct attributes that help them live their passions while adapting to the shifting economic landscape.

Commissioned by Deluxe Corp. a publicly traded company and leading provider of marketing services and business products for small businesses and financial institutions, the study surveyed more than 1,000 SMB owners around the U.S. The results showed 86 percent of the respondents believe they can do anything they set their minds to, with 77 percent also stating they would rather learn from failure instead of never trying at all.

Based on the results, it’s no wonder entrepreneurs are known as risk averse and tenacious ‒ or as some would light-heartedly state, “We’re going to succeed because they’re crazy enough to think they can.”

Pitfalls of business failure

On the whole, businesses fail due to its owners’ lack of fundamental business knowledge. Needless to say, failed businesses did not operate the same way as those that succeed. The following are oversights and inaction responsible for their demise.

  • For starters, it’s going into business for the wrong reasons. If the only reasons an aspiring business person desires self-employment is making money and selling a product he/she is in love with, stick to a regular job and conduct business on the sidelines or as a hobby. Making money should not be the sole end goal. Simon Sinek, an accomplished author and adjunct staff member of the RAND Corporation, one of the most highly regarded think tanks in the world, in his popular talks worldwide, including TED, compellingly emphasizes the following:

Why does your organization exist? Why does it do the things it does? Why do customers really buy from one company or another? Why are people loyal to some leaders, but not others?  Starting with “why” works in big business and small business, in the non-profit world and in politics. Those who start with “why” never manipulate, they inspire. And the people who follow them don’t do so because they have to; they follow because they want to.”

  •  The business is undercapitalized: a business with too much debt and a cash flow that doesn’t support it ‒ as a result of overestimated revenues and cash flow with underestimated expenses/cost of business.
  • Lacking business development – sales, the lifeblood of any business. Emphasis mainly on product rather than actually shipping quantity to its target market.
  • No USP/differentiation: another me too product, price sensitive, commoditized, and failure to communicate it in a captivating way.
  • Not focused on a particular market. Confused, and as a result, applying a gunshot approach. Unclear of its business model.
  • Poor execution of business and marketing plan. Lack of clear focus and direction. Moreover, inability to adapt to a changing environment, as well as anticipate future trends and plan for them – market phasing out unwanted items or services.
  • Poor operational management. It can be one or a combination of motives including lack of discipline, internal bickering between partners, owner arrogance, stubbornness, a closed mindset, and/or a lack of work ethic which causes complacency. Many start-ups have a carefree attitude to promote efficiency in the workplace, often needed to get their business off of the ground and persevering long afterwards.
  • Business expansions that are poorly planned and not appropriately financed. Although this growth is normally viewed as a positive development, its timing, execution tactics, and inadequate funding to sustain profitable growth stifle proper business progress.
  •  Failing to control costs – negligent fiscal management.
  • Creating dissatisfied customers: Not in touch with them along with a lack of a customer centric policy and fervent implementation with constant monitoring. Many businesses, small and large alike, offer lip service as they continue to disappoint their customers. It is a fact that the cost of acquiring a new customer is five times the cost of keeping an existing one.

Maze and Businessman

7 principles for business success: Avoid being a failed business statistic

If an entrepreneur is resolute enough to increase the chances of triumph from the outset, he/she should consider several key principles. These seven beliefs have been forged through my personal experiences, those of others I have either researched/interviewed and/or advised, as well as based on long-term practice and common sense seasoned with a touch of academia.

1)    A Viable Product or Service with the Right Business Model and a Passionate Person Behind it

It should fulfill a need, offer a benefit, be innovative and differentiate itself. It’s also imperative that the entrepreneur is passionate about the product/service, empowers his/her staff, as well as practices/conveys business ethics. To excel in the business, the entrepreneur must have the right mindset and attitude. This includes drive, perseverance, tenacity, and an undying belief in himself/herself and the value he/she adds.

2)    Adequate Capital

Critical and can vary depending on the size of the undertaking. Start your capital search with a good business plan that shows investors and lenders your company’s potential. Expect to realistically invest about 30% of your own money based on the total value of the project. Last but not least, cash-flow is the lifeblood of your business if you’re going to sustain the operation financially.

3)    Marketing, Sales and Customer Driven

Advertise, publicize, differentiate, ‒ and be compelling, as well as memorable with your messages. Deliver on those promises and constantly remain customer focused. Sales, on the other hand, is part of the marketing function.  It includes business development and account management. Sales is crucial to business because it is the bottom line, whereas marketing is about getting a product known and the customer keeps your business alive.

4)    People

Don’t simply HIRE well educated and experienced people but most importantly MOTIVATED, dedicated, coachable and with interpersonal skills. Moreover, make certain that the people you hire fit-in with your corporate culture.

5)    Systems and Structure in Place

Every business requires a disciplined way of conducting itself. This way everyone is on the same page. Consider publishing an “operations manual” and continuously enforce its procedures.  However, at the same time, it should include an element of flexibility to avert stifling the organization. Without any structure, the chances of failure increases.

6)    Strict Internal Financial Controls and Adequate Cash Flow

Finances should be closely supervised, borrowing wisely and avoiding overspending. Watch your financial ratios and yields (where applicable). The success of your business is, in many ways, measured by the bottom line. Even if you hired a full-time accountant, you would still need to have a
fundamental knowledge of accounting, how it works, and how to apply its basic principles in order to run a flourishing business. Once again, “cash flow” Cash flow is of vital importance to the health of a business. One saying is: “revenue is vanity, cash flow is sanity, but cash is king”.

7)    Continuous Improvement, Innovation and Sustained Growth

This is by no means a one-time event but rather an on-going process. Innovation encompasses offering distinguished and improved solutions which meet or exceed market requirements and expectations from your customers ‒ whether offering a desirable product or upgrading a service experience.

Keep in consideration ‒ govern oneself accordingly

Entrepreneurs, and inventors alike, may be quite well versed with the products and/or services offered, but not necessarily with running their business including a bucket list of daily administrative tasks. Most notably, sales, marketing and finance/accounting undertakings. This is where honest consideration should be given in either bringing in a partner to complement the entrepreneur’s weaknesses or an external adviser and/or mentor to guide him/her. A sounding board should not be dismissed as an advantage solely for larger organizations. Seeking professional help is an important way to avoid or plan for business challenges.

Prior to drafting a business plan as the roadmap, which assists one in avoiding the pitfalls of running a business, plotting a business model should be considered as a prelude to the business plan.  The idiom “putting the cart before the horse” clearly reminds us of this erroneous and common approach ‒ in this case, the business plan preceding the business model or lack thereof. The business model includes the components and functions of the business, as well as the revenues it generates and the expenses it incurs. It is part of the business strategy.

Typically, small businesses with inept ownership usually fail in the first year or two, but even companies in their growth stage can stumble badly when they outgrow the capabilities of the founding team. Research by the U.S. Bureau of Labor Statistics demonstrates that nearly 6 out of 10 businesses shut down within the first 4 years of operation.

Enterprises spanning a wide array of industries, have earned distinction as “well-” or “best-” managed” by demonstrating business excellence through a meticulous and independent process that evaluates their management abilities and practices – by focusing on innovation, continuous training, brainstorming and caring for their employees’ well-being – as well as investing in meeting the needs of their clients. Marketing maven and renowned author, Seth Godin, succinctly puts it this way:

Many entrepreneurs use an innovation to make an impact, but the hard part, the part that we’re rewarded for, is engaging with the user, the audience, the market. Bringing something to people who didn’t think they wanted it, know about it or initially welcome it, and make a difference.”

In the end, small businesses are started and managed by entrepreneurs, who with all their best intentions, are highly motivated but typically lack training in standard business practices. Thus, entrepreneurs with little more than a great idea, limited funds and a lack of management/operations skills and experience are prone to failure without the resources that can sustain and help grow their business.

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The Global Mindset: Entrepreneurship Beyond Borders

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By James D. Roumeliotis

With globalization prevalent at an unprecedented rate, we are witnessing a growing number of entrepreneurs entering foreign markets with products or outsourcing manufacturing. Taking their small- or medium-sized businesses globally with different and unfamiliar customs and regulations can hamper success. Overcoming these challenges requires a mind shift through a good command of foreign cultures, values, and a sound strategy by the entrepreneur. Moreover, the same knowledge can create diversity awareness by embracing and respecting multiple cultures within the organization.

Global Citizen

The capitalist as a global citizen

Along with knowledge of all fundamentals of running a business, the “global” entrepreneur systematically seeks out and conducts new and innovative business activities across national borders. Diversity of thought and culture is needed to handle global business matters most efficiently. Undoubtedly, those best prepared have an international background having lived abroad and/or studied international business. Given that not everyone has had this opportunity, there is no reason that an entrepreneur can’t get self educated and think, as well as act globally. Rather than just focus on local home issues, global horizons can be released by immersing oneself to foreign news sources (both political and business related), as well as carrying out research and obtaining information to guide toward the best decisions. Learning another language, culture, and physically exploring the countries of interest, can’t help but develop a global mindset, motivate to evaluate foreign strategy, and ultimately allow seeing things from a different perspective.

For global research purposes, resources and services at one’s knowledge base include:

1) Go online and investigate how the Internet functions in this country; key sites; key offerings; style; information dissemination

2) Examine local media; i.e. news sources online and off line, business publications. Some publications are in English. Many are not. Don’t hesitate to use Google’s “translate this page” application.

3) Multicultural training can’t hurt. Contact either educational institutions or management consultancies, who can help you prepare the necessary groundwork

4) Most countries have governmental export organizations, which provide support. In the USA contact: USCS; In Canada contact the EDC; in the United Kingdom contact the UKTI.

Most countries have “trade missions” – an overseas program for local businesses that want to explore and pursue export opportunities by meeting directly with potential clients in specified foreign markets.

In addition to cultural awareness aspect, it can be useful to find reliable local partners, who are already established and understand the country’s market you wish to target. Certain countries will not let you enter without a “local” partner. Do yourself a great favor and inform yourself on how this can work to your advantage.

Trying to contact local distributors, sales agents or licensees may not be possible without the proper introductions. Therefore, do your homework. Exploiting an existing customer base in a partnership arrangement can be very advantageous.

Payment terms and guarantees are another issue that can be dealt with through the guidance of various government export programs.

Guy Laliberte

From local and humble beginnings to the international stage

What most people don’t realize are the humble beginnings of most local firms before their recognition on the international stage.

Take for example the French-Canadian entrepreneur Guy Laliberte, and co-founder of the internationally acclaimed Cirque du Soleil. He had his humble beginnings as a street performer in Montreal where he used to entertain small audiences alfresco with his stilt-walking and fire-eating acts.

In 1984, despite his limited command of the English language and unfamiliarity with the global scene, Laliberte had a vision to create and eventually export an upscale alternative to the traditional circus. His original plan was intended to be just a one-year project.

Cirque du Soleil was scheduled to perform in eleven towns in the Canadian Francophone province of Quebec over the course of thirteen weeks. After its inaugural show across Canada with a cast of 70 to 100 performers, the Cirque unveiled its first show outside Canada in 1987. It took place in Los Angeles with great fanfare.

The stakes were high. As Laliberte recalls:

“I bet everything on one night. If we failed, there was no cash for gas to come home.”

Beyond his wildest dreams, the applause rumpled across the States like thunder.
Over the years, he continued to learn and adapt to various market conditions. With an astute understanding of branding his circus grew.

Its success is a manifestation of imagination and hard work. What differentiates Cirque from its predecessors are unique shows fueled by emotion. Today, there are 19 shows in over 271 cities on every continent except Antarctica. The shows employ approximately 4,000 people from over 40 countries and generate an estimated annual revenue exceeding $810m.

What I also admire about Guy is that he is more than just an entrepreneur. He is also a philanthropist, space tourist and professional poker player with an estimated net worth of $1.36bn according to Forbes World’s Richest (as of 9/2/17). In 2015 he sold a 90% stake to U.S. private equity firm TPG Capital and Chinese investment group Fosun, valuing the firm at $1.5bn.

The Global Mindset: Entrepreneurship Beyond Borders

My final take

Although international business is fraught with challenges, strategic planning coupled to measured risk taking pays big dividends. However, you cannot rest on your laurels. Political and economic trends shift with the wind. Sailing with the wind allows an entrepreneur to feel the pulse of trends while at the same time giving the individual a template for personal growth.

Secondly, unlike previous generations, the internet provides countless opportunities to reach out and broaden target audiences in a way that was not possible.

Governmental agencies, in most major developed countries, through collaboration with their foreign attaches, are prepared to help intrepid business people by providing entrepreneurs with technical support and resources.

If foreign expansion is on your agenda, study those firms who have made the leap successfully.

The example of the Cirque du Soleil brilliantly demonstrates how it
is possible to stake out your corner. Logistically, Cirque also understood that success needed to collaborate with locals and to deliver entertainment in a focused way which transcends culture and language.

I attribute this success as well as others to a keen appreciation of EQ rather than IQ. After all, having a global mindset implies cultural intelligence coupled to traditional business practices.

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Adding Personality to a Dull Product Through Clever and Humorous Ads

By James D. Roumeliotis

Poo Pourri Ad Image

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Let’s be candid: not many of us pay much attention to advertising for life insurance, bathroom tissue or medical devices. What’s there to be excited about? Adding a dose of personality with humor may create attention for those types of products which we would not otherwise have given them much attention — especially among a plethora of advertising. This also applies to generic products such as soap and bottled water.

Not every product or service brand is stimulating

Not every brand is as exciting such as Victoria Secret, Porsche or Apple. Many brands, it turns out, are simply staid, generic or both. However, the creative ones have put much thought into developing content which captures attention. This would come in a form of either:

– a humorous type ad;

– an emotional style ad which results in becoming remarkable and memorable; or,

– embodies a certain lifestyle which most in the target market would be able to relate to as their own;

– it turns out good enough that many of us would share the advertisements with others (as I am doing in this article).

Cases in point worth noting: clever ad campaigns

Below are examples of products and services which can stir emotions – whether arousing, dramatic or amusing.

Zyppah (snoring device)

Zyppah (“Happy Z” spelled backwards) is an oral sleeping device which claims to eliminate snoring. It doesn’t sound or look like a sensuous device, so the brand decided to develop a clever advertising campaign by creating a character – a spokesperson of sorts with a thick New York City accent, named “Jimmy.” The results can be watched and heard below.

https://www.youtube.com/watch?v=mZBiPxn-haA

https://www.youtube.com/watch?v=nWHIkX7_mHY

Poo-Pourri (a fragrance brand that develops and markets deodorizing toilet sprays)

 Suzy Batiz had an obsession with getting rid of “poop odor” to the brink that for nine months she relentlessly worked on developing an oil-based spray you put on the surface of toilet water before you go. It worked! Her claim is that her product, named Poo-Pourri, has a unique oil which “…creates a layer, and whenever the poo goes in, it actually encapsulates it, it sort of ‘wraps’ the odor.” Truth be told, bathroom products are not the most thrilling to market, let alone such a spray to diminish poo smell – or so you thought. By taking a taboo subject and adding humour and surprise, Suzy Batiz and her marketing creatives, decided to add a dose of bliss to the video ad by featuring an elegant, well-dressed woman with a British accent and revealing her grief of trying to disguise unpleasant bathroom aromas. The ‘Girls Don’t Poop’ initial ad campaign quickly went viral gathering over 6 million views and 278,000 shares in its first week. Here is the video link: https://youtu.be/ZKLnhuzh9uY

Big Lou/Term Provider (life insurance broker)

Life insurance, for many, is a morbid product which needs to be sold rather than bought by most on – and if so, on their own initiative. Therefore, how does a prominent term life insurance brokerage firm start a conversation and promote its intangible products which only beneficiaries can eventually claim its proceeds? Term Provider, the actual name of a term life provider decided to add a pun by branding it with a catchy name – Big Lou – as if its owner is obese and nicknamed Lou is in Louis. We are not certain if the founder/owner of this agency is actually overweight as he claims, as we do not get to see him in his ads. His ads, link below, are for the most part, aired on CNN satellite (think Sirius XM) radio.

https://biglou.com/commercials/

Eyelab (Optometry examination facility in South Africa)

This ad campaign was created in a form of print advertisement by Canvas in South Africa for Eyelab, to promote its professional services. The one below insinuates that this attractive lady needs to have her eyes examined since she appears to have chosen an incompatible and geeky looking man as her mate. In reality, her choice can be quite subjective and a personal choice of hers without any of us being too judgemental. Needless to say, it is eye examination promotional content with a different twist.

http://adsoftheworld.com/media/print/eyelab_couple_1

Optometrist Funny Ad

Bling H2O (luxurious) water

How about branding water and putting the world’s most expensive price tag on it predominantly by visual appeal and perception? That’s just what its founder and president, Kevin G. Boyd, did for Bling H2O which he labels it as “luxury” and charges about $44 per bottle. He has accomplished this through a clever marketing strategy such as:

– focusing on distribution of limited editions;

– creating a fancy glass water bottle to add cachet;

– conveying a glamorous story with his marketing messages;

– has celebrities sipping his water and as a result, gaining massive publicity.

AAA

Virgin America and Air New Zealand (airline safety instruction videos)

In less than two weeks following its release online, Virgin America managed to get almost 6 million people to watch their safety video without even stepping foot on the plane.

https://www.youtube.com/watch?v=DtyfiPIHsIg

Air New Zealand created something a little different and entertaining for their safety instructional video by celebrating the third and final film in The Hobbit Trilogy – The Hobbit: The Battle of the Five Armies.

https://www.youtube.com/watch?v=qOw44VFNk8Y

In the final analysis

Although many products or services such as bottled water, insurance and banking services are not exciting on their own, it doesn’t mean they should remain dull. They still do have the potential to be branded with charm, emotion, sex appeal, or yet attributed to a certain lifestyle. A good sense of humor also comes a long way – provided that creative campaigns can be produced with unique and passionate content worth talking about and sharing.

Positioning the brand is another way to differentiate any generic product. It’s what you create in your target customer’s mind, along with the benefits you want him or her to think of when he or she thinks of your brand.

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What Constitutes an Authentic Customer Experience and Which Brands Are Role Models?

By James D. Roumeliotis (with content/survey by Ian Golding)

Customer Loyalty Service Support Care Trust Business Concept

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As a big proponent and practitioner of the total customer experience, I often cringe when I and many others endure displeasure when transacting with established brands. The companies in question happen to possess deep pockets which constantly communicate about how wonderful they are doing business with. In actuality, they fail miserably in delivering on those messages. The blame goes to their frugality and/or complacency along with their dysfunctional business practices.

Building emotions into the brand’s DNA

According to Derrick Daye, partner at The Blake Project, in his intriguing article,Igniting Brand Growth Via Emotional Connectionshe states that research shows that, on average, 50% of purchase decisions are based on emotion and that a ‘Right Space’ – the core emotions a brand seeks, is what its customers should feel across every single interaction/touch point with which they encounter.  He further states that “Marketers that understand this and that harness the power of emotions are today’s true brand builders and are uncovering new opportunities for growth faster than their competitors.” A case in point used is with Apple. The brand utilizes four emotions that drive customers to loyalty. They are delight, surprise, connection and love. This video displays how Apple succeeds at accomplishing this.

Survey says

In January 2015, Ian Golding, a Certified Customer Experience Professional and Customer Experience Specialist based in the U.K., conducted an independent survey of people across the world to find out who their number one Customer Experience brands are and most importantly what makes them top of mind for this purpose. Below he reveals the findings of the research. It is fair to note that much of this material was derived from Ian Golding with his permission.

top-10-brands-customer-experience

The right customer experience is commercially rewarding

The sheer mention of ‘Customer Experience’ and ‘Customer Centricity’, is still often greeted with a rolling of the eyes by those who are more focused on sales targets, operational efficiency and tasks. The irony though is that the former makes the latter much more successful. Also, it’s no coincidence that each of the top 10 brands has recent performance milestones to be proud of:

  • Amazon Q4 14, net sales increased by 15% over Q4 13
  • Apple 39.9% profit per product (3 months to end Dec 14)
  • First Direct Moneywise “Most Trusted” and Which? Best Banking Brand
  • John Lewis profit before tax up 12% in 2014 vs 2013
  • Disney Earnings per share up 27% in year to Dec 2014
  • Air New Zealand Earnings before taxation up 20% in H1 15 vs H1 14
  • Mercedes Revenue increased 12% from 2013 to 2014
  • Starbucks Revenue rise 13% in Q1 FY15
  • BMW 7% increase in vehicle sales in Jan 15 vs Jan 14
  • Boden Shipping 12,500 parcels each day

Is it just a coincidence that the brands you are saying are the best at Customer Experience all seem to be faring well on the commercial front? It appears as though all of the brands that are ‘great’ at Customer Experience share common characteristics

These organizations have common characteristics

I wanted to know what it is that your favorite brands do to make them your #1 at delivering consistently good Customer Experiences. I asked for up to three reasons from each respondent and received 575 comments. Following verbatim analysis, 13 categories were identified, each distinct but interlinked. They were, as follows (with the percentage frequency they appeared):

  • Corporate attitude 15.9
  • They’re easy to do business with 14.9
  • They’re helpful when I have a problem 11.4
  • The attitude of their people 9.4
  • Personalization 8.0
  • The product or service 8.0
  • They’re consistent 7.5
  • The way it makes me feel 6.3
  • The way they treat me 5.1
  • They’re reliable 4.4
  • They do what they promise 4.2
  • They’re quick 2.6
  • The technical knowledge of their people 2.3

We will look in more detail at what we mean by each of these in a moment but to view at any one in isolation would risk limiting what is being achieved by these organisations. This diagram shows how interdependent each area is in aligning with the corporate attitude and ultimately organizational goals and the very purpose for why the business exists:

characteristics-of-customer-experience-brands-by-j-golding

Focusing on these attributes is what moves companies from fighting a rear-guard action to fix issues of their own making to creating a compelling a sustainable brand for the future. It also means that customers are increasingly exposed to better experiences as they go about their daily lives and that’s important because it keeps nudging the bar of expectations higher. This is why the brands that do these things are ones that people consider to be the very best at delivering consistently good Customer Experiences. Digging deeper into each of the 13 areas we can build a picture of how the companies who get it right control the way they do business.

  1. Corporate attitude

It’s another way to describe organizational culture and it underpins everything that happens to or with a customer. More specifically, in the words of those who responded to the research, companies who have the right attitude:

  • Put people before profits and non-human automation;
  • Know they’ll make more money in the long-run with this approach;
  • Test all experiences thoroughly (to eliminate unintended consequences);
  • Listen and demonstrate they understand their customer;
  • Pay serious attention to detail;
  • Empower their staff to makes decisions and act straightaway;
  • Stay true to their values, admit when things go wrong and fix them;
  • Ensure their staff are fully trained and informed;
  • Recruit for attitude and alignment to brand values.

They also said: “…they treat each customer as we would a guest in our home” and “…they balance customer obsession, operational excellence and financial rigor.”  Almost every other category is a sub-category of this one. It shows how important the right culture is.

  1. They’re easy to do business with

It’s obvious to say a company should be easy to do business with and yet that’s not always the case. What respondents meant by “easy” included:

  • There are no barriers in the way for doing what a customer needs to;
  • It’s simple to get information, purchase and use the product;
  • Needs are anticipated and catered for;
  • Customers don’t need to repeat information;
  • They can switch from one channel to another with no impact on progress;
  • Products can be returned or fixed with minimum effort on the part of the customer;
  • They are available when and where customers want; they can be reached without waiting and won’t limit the hours of their support functions to office hours if customers are still using their products and services all day every day;
  • They are proactive in taking responsibility, for example: Finding products at other stores and having them delivered;
  • Customers have no objection to self-service because it has been well thought through;
  • Information is presented in a timely, clear and relevant way.
  1.  Helpful and understanding when I’ve got a question

Being easy to deal with is critical when a customer needs help or simply has a question. On the assumption that good companies do respond (a recent Eptica survey found more than 50% of online inquiries go unanswered), helpful companies are ones who:

  • Listen to understand before acting;
  • Give a customer the feeling that they are trusted and respected;
  • Will provide an answer and additional, relevant help;
  • Provide certainty and manage expectations about what will happen next and at each stage;
  • Empower employees to make decisions;
  • Resolve issues first time and quickly;
  • Have employees who are happy to give their names and direct contact numbers;
  • Pre-empt problems and solve them before customers are aware;
  • Fix customers’ mistakes without blame or making them feel awkward;
  • Follow-up afterwards to check everything was sorted and is still as it should be;
  • are not afraid to apologize when they get it wrong.
  1.  Attitude of the people

Individual employees who are interacting with customers become a proxy for the brand. If they demonstrate the wrong behaviors the damage can be hugely expensive but getting them right does not cost a huge amount of money. Most often a function of the corporate attitude, the most appreciated characteristics are:

  • Being courteous and friendly;
  • A positive, “I’ll sort it” attitude;
  • They are good at listening;
  • It’s obvious they care about, and are proud of, the product/service;
  • They are professional and not pushy;
  • They are helpful and proactive;
  • They are genuine and humble;
  • They smile;
  • Hey are engaging and interested in the customer;
  • They have personality, not a corporate script;
  • They are patient;
  • They show respect for their fellow colleagues.
  1. Personalization

We are all individuals and like to be treated as such. Having “big data” was seen as the answer but as these companies demonstrate, it’s not only more important to have the right data and do the right things with it, but it’s also linked again to corporate attitude. Those who get the personalization right:

  • Understand, anticipate and are proactive;
  • Keep customers informed with relevant information;
  • Shows they listen and act, not just collect feedback;
  • Create a relaxed environment because a customer’s needs fits neatly into what they are offering;
  • Create a feeling of respect, that they care and have “taken the time to know me, to make things easier for me”;
  • Make it feel like dealing with a person where there’s a connection, not just a transaction;
  • Allow their customers to control the degree of personalization in terms of frequency and content;
  • Remain flexible and adaptive to the circumstances, not scripted.
  1. The product or service itself

Making it easy, personal and rewarding will be wasted effort if the core product or service doesn’t live up to expectation. At the end of the day, your business must have something of value to the customer to sell! When it comes to products and services, the #1 Customer Experience brands are those who:

  • The right mix of choice, relevance, quality and innovation;
  • Well designed, so it is easy to get it to do what it’s supposed to;
  • Quality is complemented by relevant innovation, not technical innovation for the sake of it;
  • Obsessive about the detail;
  • Paying as much attention to secondary products, such as food on airlines;
  • Good at turning necessary evils into compelling attributes – Air New Zealand’s legendary on-board safety briefings, for example;
  • Adept at keeping up with, ahead of and shaping basic expectations.
  1. Consistency

As customers we like certainty and predictability. It means that the decisions we make carry less risk because we can confidently trust the outcomes. It also demonstrates stability of, and a shared understanding of, strategy. For our respondents, consistency is about experiences that:

  • Look and feel the same;
  • Can continue easily wherever, whenever and however;
  • Match or build on the positive expectations created last time;
  • Have continuity in not only what happens but how it happens; tone of voice, quality, different locations, store or franchise, people and processes, performance;
  • Provide the same reliable answers to the same questions;
  • Integrate with other services.
  1. The way it makes me feel

Emotions are a function of how good the other two cornerstones of Customer Experience – function and accessibility – are. How they were made to feel, whether intentional or not, is what people remember. Being the personal consequence of most if not all the issues covered here, it is what drives our behavior about whether or not we will do the same next time and tell others to do the same. If people think they are part of something special, connected to a company that lives by like-minded values, they will FEEL special. And as human beings, we appreciate that. Survey respondents cited a number of great examples:

  • “Get on an Air New Zealand flight anywhere in the world it already feels like you’re home”;
  • “The packaging increases the anticipation when opening a new product” (Apple);
  • “Interactions with employees don’t feel like processes out of an operating manual”;
  • “There is (the perception of) a genuine relationship; it’s not just about them selling every time they are in touch”;
  • “They make me feel as if I’m their only customer” (Land Rover).
  1. The way they treat me

At the root of how we feel and therefore behave is often down to how we are treated. Good and great companies have experiences that:

  • Demonstrate respect;
  • Show an empathy with customer needs;
  • Don’t do things like asking a customer to repeat information if handed from one colleague to another;
  • Keep customers posted on feedback they’ve given;
  • Recognize their customers both by staff individually in-store and organizationally;
  • Have a consistency of treatment even when not spending money in-store;
  • Create relevant retail environments so that customers feel they are treated as if they are somewhere special;
  • Develop meaningful loyalty programs that acknowledge past purchases and reward future ones;
  • Are not patronizing in tone.
  1. They’re reliable

Not surprisingly, reliability is cited as a key attribute. Although we simply expect things to work as they did last time or as it was promised, we probably won’t get too excited if that is the case. However, the consequences of it not happening will result in additional time, effort, inconvenience and sometimes cost to the customer; not what a brand would want to be blamed for. There are some markets where the mere hint of a lack of reliability in its truest sense has serious consequences for a brand. More generally, reliable customer experiences are ones that:

  • Give confidence and a level of trust that what we ask for when we buy is what we get – there are no nasty surprises;
  • Understand that they are key to repeat purchases and advocacy. No-one will put his or her own reputation on the line to recommended any brand product or service that is unreliable.
  1. They do what they promise

Again, this is a character trait we appreciate in friends, family and colleagues and it’s no different when dealing with a business. It can be seen as a subset of “the way they treat me” but it is also critical at a strategic level too; the brand is what people say it does and so that has to be consistent with what it’s promising, just as its employees need to keep their own promises to customers too. There’s a real financial benefit here too where unnecessary and costly rework can be avoided. How many enquiries coming into the business are because “You said you’d get someone to call back”, “You said you’d send me a copy of that statement” or “Where’s my fridge, I’ve had to take the whole day off work and there’s still no sign of it.” Customer experiences that do what they promise:

  • Live up to the expectations they set;
  • Have employees that do what they say they will do;
  • Do it all consistently;
  • Fix it quick if they fail;
  • Are good at managing expectations.
  1. Timely

As customers, time (alongside money) is a commodity we trade with. A company who appreciates the finite and precious nature of it will create a distinct advantage. In today’s everything-everywhere-now life it’s not surprising that speed is an issue. Expectations are rising all the time where customers interacting with other brands see what can be done. Timely customer experiences are ones that:

  • Move at the right speed for customers;
  • Show respect by having have good reaction times once a customer has initiated part one of a two-way activity;
  • Manage expectations, so if it’s not “quick” as defined by customers there are also, no disappointing surprises;
  • Are not just focused on speed of delivery but are quick to answer the phone, flexibility to find ways around rules and respond to questions.
  1. People knowledge

Having people who are technically competent with their product knowledge is another character of top brands. Companies that possess employees like this have an invaluable asset who are:

  • Able to translate the concerns and questions;
  • Able to articulate complex issues in simple language;
  • Are not patronizing;
  • are proud that their knowledge can help someone else.

In Closing: Be your Chief Customer Officer

Through my personal research and experience ─ and those of the authors credited above, one arrives at the conclusion that Building and nurturing a brand is what makes an enterprise gather wind under its wings. Common intelligence dictates that the way a customer is dealt with reflects on the integrity of the brand, and the image of the company in the mind of the consumer.

When customers are treated with honesty and delighted by a particular brand experience, they begin to bond emotionally with the brand. They become brand loyalists and advocates – buying the brand more often and recommending it to others. This behavior serves to build the brand’s reputation. This approach is priceless –even though it may take longer to take positive effect.

Stellar customer experience is not only reserved for the big brands. It can exist with businesses of all sizes and stages. It is about a mindset ─ the right attitude and culture within the organization where everyone is customer centric which matters more than solely the bottom line.

As a final point, the leadership of the brand, whether with a title of president, managing director or CEO (C-suite), he or she should be the “chief customer officer.” According to a survey that The Economist Intelligence Unit recently conducted of how global companies manage their customer experience programs, 58% of companies that are much more profitable than their competitors report that the CEO is in charge of customer experience management. Indeed, the commander-in-chief of the company is the one who sets the tone and culture for the organization. If the CEO of a publicly traded company focuses on quarterly profits to satisfy its shareholders’ demands at the expense of being customer centric, everyone else below him or her will do what it takes to fulfill their boss’s expectations and requirements. It is quite a regrettable situation which occurs often with many public corporations.

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20 Steps to Launching a Food Company: Lessons from a Start-up in the Gluten-free Sector

by James D. Roumeliotis

plethora-of-same-old-big-food-brands-on-shelves

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For those who are considering venturing into the recession proof food production sector, though previous experience in that domain would be a valuable asset, if you have the passion, discipline, adequate funds, a viable product, and a high caliber team (with individuals that bring sales, marketing and finance expertise along with CPG know-how), your rate of success will undoubtedly increase. However, in practice there are no guarantees of triumph regardless of your resources. Blame is not entirely on the entrepreneur but rather on circumstances beyond one’s control. As such, there is a way to increase positive outcomes throughout the start-up journey by being prepared and anticipating potential hurdles in advance. This entails implementing a feasible strategy, remaining resilient along the way and applying a practical step-by-step process as the one outlined in this article. Consider it as your guide which was developed as a result of painstaking experiences during 18 months which ultimately led to launching a gluten-free and health snack from the ground-up.

What it takes to make it to market

  1. Food product or beverage idea, viability and development: How unique will your product idea be? Which food category is it supposed to fall under (snack, poultry, dry snack, frozen etc.)? What will be unique about it? Will it possess sales potential ─ especially repeat sales? Initial sales are fine but repeat orders are more important.
  2. Market research and competition: Like in every type of business and industry, conducting market research and your in-depth information about your competition is imperative in deciding if your potential product is good enough to compete with existing products. How will it be sold? Pricing etc. (marketing mix).
  3. Testing/Sampling and feedback: Before you invest in purchasing ingredients, packaging and other items in bulk, it is highly advisable that you determine if your food product will have appeal in the marketplace. That said, feedback from focus groups can not be underscored.
  4. Co-packer/contract manufacturer or kitchen space leasing: To produce your product you may want to find and negotiate with a facility where it will be produced in small or large batches – either with your own team or one provided to you. Co-packers/contract manufacturers normally charge per hour of production (with a minimum daily run) or a fee per packaged finished product. Along with their own in-house brand, they have the extra capacity to accommodate private label contracts.
  5. Product costs and potential earnings: Have someone with accounting and costing experience do this on a spreadsheet. Know your costs and margins ahead of time, as well as what you can potentially sell it wholesale and/or direct to the consumer ─ keeping in mind there are intermediaries involved such as food brokers and/or distributors.
  6. Ingredient sourcing: Contact potential suppliers of ingredients. Shop around especially for the best deal, supply capabilities, for quality certifications, and credit terms. Make certain you always have two or three suppliers as a back-up. Ask for specifications of each ingredient.
  7. Product formulation testing and sampling: This is most certainly not a one-time event but an on-going process. Do not be surprised if it can take as many as 50 or more trials before the formula has been refined. Refrain from haste in launching your product until the flavor profile and texture you are trying to achieve are above board. Your brand and brand new reputation are at stake.
  8. Scaling from the kitchen and lab to mass production: Small batches in the kitchen will not yield the same results when going into full scale production. The formula will almost certainly require several tweaks made progressively during the production process to produce similar texture and flavor.
  9. Funding requirements and sources: Based on what it will cost you to bring the product to market (with a reserve for unforeseen expenses), including constant operating expenses and perhaps a reasonable salary, determine how much you will need less your own funds (dubbed “bootstrapping”). The balance can be sought from either private investors and/or friends and family. Banks are reluctant to lend to start-ups as they would rather wait several months for your business to show some traction.
  10. Market – Retail, institutional or both: Establish where you will be pitching and selling your product. Keep in consideration that by going retail, you ought to invest additional funds in branding, packaging, instore sampling, promotional activities and perhaps shelf/slotting fees by major supermarkets. Start locally and slowly expand outside your area, state/province and eventually beyond your country borders.
  11. Channels of distribution: If you will be dealing with retailers, it is not always possible to go direct as they prefer you do so indirectly via distributors they deal with (a matter of streamlining inventory and invoicing). Distributors can tag anywhere from 30” to 40% margins above what you wholesale the product for. Retailers will tack on an additional 30% to 45% by the time it is sold to the consumer. If you are seeking to outsource your sales activities, consider doing so by hiring a food broker or two who have great contacts in the retail and institutional food sector, thus open many doors for potential purchase orders. Typically, they earn 5% to 6% of sales made under their account.
  12. Marketing and branding strategies: In the business world, it goes without saying that marketing and branding activities are crucial in developing awareness for the product. The new normal is more emphasis on digital/social media, experiential marketing, cause marketing and guerrilla/grassroots marketing among other tactics. Going retail takes long to establish brand recognition which is a costly affair.
  13. Business model and business plan: A business model describes how and where you wish to operate your business, as well as how you plan to generate revenue and profit, whereas the business plan is a comprehensive document which states your businesses’ operational, marketing and financial goals and how it intends to meet them. It is like your company’s road-map. The business model you create is detailed in the business plan. Therefore, the business model comes before the business plan akin to the horse before the cart. Both are essential.
  14. Company name and formation, as well as product liability insurance coverage: There is no legitimate business without forming a company – an incorporation (limited liability) in favor of a sole proprietorship or general partnership (merely a registration). Additionally, do not take any risks in case there is a recall and/or someone gets ill caused by your product. Anything can go wrong from the supply chain to the product getting processed at the plant – regardless of the safety measures in place. Top food brands have not been immune either.
  15. Brand name trademark: Take the cautious path of protecting your company name and brand (including the logo). In the end, you will have invested an adequate amount of time and money, therefore, make certain you protect the intangible assets you are creating, otherwise, it may cost you plenty more to defend it in the future.
  16. Food safety issues, nutritional declarations and labeling requirements: This is a vital responsibility and requirement from the FDA (U.S.), CFIA (Canada) and in the European Union it is Regulation (EU) No 1169/2011 . Legislation with those governmental agencies includes what should be declared as ingredients on the packaging, as well as on the compulsory nutritional label (format varies from country to country).
  17. Packaging design, formats, POPs and UPC bar codes: The expression, “You eat with your eyes” applies quite well when it comes to food packaging – especially if you want your product to stand-out. A colorful, yet minimalist clean design on a quality package speaks volumes and can command a premium retail price. It is what is know as “perceived value.” Consider creating a POP display which will further expose your product, accentuate it, as well as possibly avoid paying slotting fees. Bear in mind that every product item, called a SKU (Stock Keeping Unit) requires its own bar code called a UPC (Universal Product Code). You can register and obtain this for an annual modest fee at gs1.org (or www.gs1ca.org in Canada).
  18. Going to market, in-store sampling and other activities: Launching a product for sale requires careful planning and timing. This should be well coordinated with your team and the food broker and/or distributor (or retailer directly). To introduce the unfamiliar product/brand to the consumer, where he or she shops, it is highly recommended that sampling be conducted in-store. There may be a cost associated with this if a third-party marketing company, specializing at this, is hired.
  19. On-going refinements and customer feedback: Once a product arrives on retail shelves, there is no reason to get complacent. A product’s flavor profile should be enhanced based on customer feedback which should be encouraged by making it easy for him or her to communicate with you (email, social media and perhaps a toll-free number on the packaging).
  20. Continuous research and development for new products – in-house production consideration: Progress and category success require constant innovation, refinements and tactics ─ whether it is with existing products or launching new ones.

Everyone needs to eat to survive

Starting a business is a challenge with statistically high failure rates during the initial five years ─ let alone starting a food production business. Statistics on this sector show promising growth.  However, the food sector, especially in the health category, has tremendous opportunity for brands which offer snacks, ready to eat or easy to prepare meals which are tasty, allergen-free and with all natural ingredients – especially plant based.

The biggest challenges in the CPG (Consumer Packaged Goods) sector are the need for a large sum of capital (most notably if you plan on opening your own facility), a focus on research & development, scaling the product from the kitchen to manufacturing, as well as executing a plan for going to market. It is also an industry with government safety regulation requirements which the food entrepreneur should be quite familiar with and comply without compromise.

Despite the industry’s inherent challenges, it is still worth considering this route as there is plenty of room to increase one’s prosperity while also benefiting the consumer with nourishment. Although there is complexity involved, it is recommended that one starts small, hires a contract manufacturer for production. The moment sales begin to increase dramatically along with cash flow, a that juncture, in-house manufacturing may be a viable option.

As for risks, choose to take the “calculated” type as in “planned with forethought.” Anticipate problems and be prepared with viable solutions. Finally, watch those margins carefully.

______________

According to Mintel, a research firm, these are the food market categories.

  • Baby food market
  • Breakfast cereals market
  • Dairy market
  • Fruit and vegetables market
  • Meat and egg products market
  • Pet food market
  • Savory spreads market
  • Snacks market
  • Bakery market
  • Chocolate confectionery market
  • Desserts and ice cream market
  • Meals and meal centers market
  • Processed fish market
  • Sauces and seasonings market
  • Side dishes market
  • Soup market
  • Sugar and gum confectionery market
  • Sweet spreads market
  • Sweeteners and sugar market

I would also add:

  • Specialty-Gourmet
  • Gluten-free
  • Health food
  • Vegan
  • Paleo
  • Artisan
  • Meals-to-go

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This Blog’s Top 10 Most Read Articles of 2016

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Once again, the ten most read/popular articles have been rounded-up — this time for 2016.

Thank you for your readership and much success to you this year.

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#1 Luxury vs. Premium vs. Fashion: Clarifying the Disparity
#2 The Art of Selling Luxury Products: Brand Story Telling & Persuasion
#3 Exceeding the Hotel Guest Experience: Anticipating and Executing Desires Flawlessly
#4 Perceived Quality: Why Brands Are Intangible
#5 Mass Customization & Personalization: The Pinnacle of Differentiation and Brand Loyalty
#6 Brand Awareness: the influence in consumers’ purchasing decisions
#7 Identifying and Catering to the Discerning Consumer: Quality and Service Above All
#8 Start-up Essentials: A Universal Roadmap for Starting a Business — Infographic
#9 The Ultra Luxury Purveyors: Lessons from brands catering to the richest 1 percent
#10 Product Features vs Benefits: The Brand Differentiation
Which is/are your most favourable?

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THE SEVEN KEY PRINCIPLES FOR BUSINESS SUCCESS in slides – A Personal Belief Through 38 Years of Practical Experience

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Three Things Businesses Can Learn from the Late Prince, The Artist

by James D. Roumeliotis

Prince Logo

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Prior to his sudden demise, I always had quite the fondness and following for Prince, “The Artist.” Ever since I discovered his music in the late 70s, what never seize to amaze me since was his eclectic work (comprised of dance, funk and rock tunes), vocal range and the method in which he always managed to integrate it all seamlessly during his formidable stage presence.

However, what many may not have been aware of was his show business acumen. Prince built and sustained his personal brand along with the resources he exploited which comprised of his musical entertainment enterprise.

What I have learned from this beloved and prematurely departed artist are three lessons which any business can use as a takeaway for implementation. They are as follows:

1) Stray from the ordinary and remain relentlessly competitive

“The Artist” was widely acclaimed by his fans, the media and fellow musicians as one of the most influential and creative musicians of his generation. He seemingly left behind an impressive music legacy. Unlike most artists, Prince was a prolific songwriter, multi-instrumentalist, sang in a variety of vocals, produced his work, as well as displayed dance and theatrical antics on stage. Must we forget that he was also an actor ─ most notably in “Purple Rain” along with performances in four other movies including on television. Moreover, he wrote songs for and produced work for other musical acts including some he impacted and/or for whom he acted as their mentor and coach.

Prince also knew how to outdo his competition by standing out with his artistic performances including the eccentric outfits he sported along with his leaping dance acts he displayed with his platform shoes ─ as he only stood at 5’2”/1.58m. Some of his singles, which eventually turned into big hits, were purposely targeted at some of his rivals.

An exemplary display of Prince’s unique and memorable performance was a video, recorded at the 2004 Rock and Roll Hall of Fame induction ceremony. The illustrious artists playing the Beatles’ “While My Guitar Gently Weeps.” include George Harrison’s son Dhani, along with old band-mates and collaborators Jeff Lynne, Tom Petty and Steve Winwood. However, most striking among this band, who stood slightly apart from the rest while they played ordinarily, was Prince. Despite his small frame and wearing a dark suit with a red shirt, a matching derby hat, and staying on the sidelines for the first 3:27 minutes or so (in the YouTube recorded video), he suddenly steals the show with his passionate guitar solo. As the song ends, Prince abruptly takes off his guitar, tosses it in the air and then disappears off stage. That was probably the most memorable part of the video from my perspective. Many more who watched it share the same sentiment.

2) Branding, image and reputation are your equity

As with traditional businesses, Prince had created a personal persona – where the brand and performer were synonymous. He created a logo dubbed the “The love symbol” ─ one that blended the symbols for male and female which was instantly recognizable. It was also the shape of his customized guitars. Prince even owned a signature color in the mind of his followers – purple. His occasional provocative lyrics, seductive singing, dramatic performances and distinctive album covers all depicted a unique style as an icon and as a showman of his personal brand.

As one Twitterer remarked in his Tweet following Prince’s death,Prince built a brand around his music and his genius before content marketing and personal branding became a thing.” Another stated, “Like Bowie, Prince reminded us that it’s not just OK to be weird—it’s cool to be weird.”

The moral of this narrative is that as a business, follow what Prince did ─ by working on building your brand image consistently, by establishing unique features with your products/services that distinguish them from the competition, and by being true to yourself, as well as by what you truly stand for.

3) Become vertically integrated

Prince was more than an artist, he was one who only entrusted himself with songwriting, arranging, producing, naturally performing his own music, as well as distributing it through his own label (NPG Records and Paisley Park Records before it). To do so, he built a $10 million state-of-the-art complex in a suburb of Minneapolis, Minnesota which he named Paisley Park Studios. That said, he became his own vertically integrated corporation. This was, after all, a multi-talented musical artist who believed in taking control of his own destiny and in return, earning the maximum revenue and profits rather than giving much of it away – most notably to a record label. He considered the role of record labels exploitation and slavery. He was a fierce advocate for artist rights and independence and in he had standoff with Warner Bros., his label at the time. In protest, Prince removed his name from his album releases and changed his name to a symbol. He also styled himself as “The Artist Formerly Known as Prince.” Furthermore, during a legal battle with Warner Bros., he scrawled the word “Slave” on his face during his appearances and performances.

The significance with this illustration is that a business with adequate capital, resources and expertise ought to consider amalgamating most or all of the processes under its own umbrella. A such, quality control and improved profits are now controlled by the business itself.

Paisley Park Studio

Paisley Park Studios

A final point of intrigue

On a noteworthy footnote, in his 37 years as an artist ─ and unlike many with his fame, he kept himself out of the negative spotlight. He never plagiarized a fellow artist’s work, never had to hire a ghost writer, and neither involved in a scandal which would drag him to the courts. In the end, he was capable of playing more or less 20 instruments admirably and having earned 19 Platinum albums, 6 gold albums, along with a double diamond record for his Purple Rain album which sold 21 million copies. Impressive for a personal brand to say the least.

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Catering to a “Luxury Lifestyle”: Definition and Execution

by James D. Roumeliotis

Yacht Lifestyle Shot from the Air

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A “luxury lifestyle” denotes a way of life which is pleasantly enhanced through well crafted products and exceptional services. These include dining at the best restaurants, lounging in the finest hotels, dressing in premium and bespoke clothing, wearing jewellery/watches produced in limited quantities, possessing and driving the most extravagant cars, traveling to exotic destinations, and playing with the most sophisticated tech products – amongst others. Needless to say, those consumers are connoisseurs of the finest products and services money can afford them.

According to a white paper and survey, conducted by the prestigious consulting firm McKinsey & Co., it indicates that there is no widely accepted definition of “luxury lifestyle.” It goes on to say that Attendees of the 2012 Financial Times Business of Luxury Summit suggested the following definitions: “a way of living,” a set of “attitudes and values,” or specific “consumption habits.”  Consumers interviewed in London, Milan, Munich, and Paris gave equally diverse definitions. Some offered a broad perspective (“a way of being, dressing, behaving” that “sets you apart from the rest”); others referred to particular products, brands, and experiences (“staying at nice hotels”); still others took a cynical view (“it’s just brand names, that’s all” or “it’s marketing”). Its interviews with senior executives from luxury- goods companies such as Harry Winston, Hermès, and Roberto Cavalli yielded yet another varied set of definitions, including “embodying the lifestyle of an iconic designer” and “offering a holistic brand experience.” Although they all defined the phrase differently, 70 percent of the executives they interviewed said they regard their brands as luxury-lifestyle brands.

A company can define itself as a lifestyle brand when its products promote more than a product with key benefits and attributes. However, lifestyle branding is more than just promoting “a way of life.” It is a product or service that provides consumers with an emotional attachment to the lifestyle of the brand. Take Versace, for example, which besides its fashion apparel and accessories also has hotels, home furnishing/décor, linens, beauty and more. Giorgio Armani also has his eponymous name on hotels, furniture, fashion, jeans and beauty. From these two fashion icons, we can certainly surmise that they have a legitimate claim as “luxury lifestyle” purveyors.

Developing the luxury standard of living through desirable customer experiences

Lifestyle branding is more than just promoting “a way of life”. it is a product or service that provides consumers with an emotional attachment to the lifestyle of the brand. think of Ralph Lauren and you can readily see it is not about the clothes. it becomes an attachment such as the sports car brand Porsche to an exclusive club in which you can be a member through emotional identification through use of the products in question. Smart companies understand these principles and look to keep the customer engaged. By doing so, they clearly forge the sort of long term relationships, which become the envy of their designated sector.

The “Total Customer Experience” is the sum total of the interactions that a customer has with a company’s products, people, and processes. It goes from the moment when customers see an ad to the moment when they accept delivery of a product and beyond.

The experiences customers go through with a purveyor of luxury determine the ultimate perception of its brand and image. Customer experiences also spread the word (offline/online) to others (friends, relatives etc.) about your brand. That said, each customer contact (“touch points”) should be handled with the utmost care to ensure that the total brand experience a person has is constant.

Lifestyle brands develop emotional attachment

Brand loyalty is about building an emotional, and in some cases, irrational, attachment in a product. The most ideal examples are the diehard brand enthusiasts and early adopters who must get their hands on the latest iPhone or iPad. This happens because Apple has built an emotional attachment to their products by creating a lifestyle choice rather than a product purchase.

It’s about how it makes you feel. Same goes for baby boomers, whether accountants or attorneys or business executives who purchase a Harley Davidson motorcycle and ride them for about four or five hours every Sunday afternoon. The bike makes them feel like a rebel – sort of an escape.

A brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based on features like cost or benefits alone. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Lifestyle brands have gained an increased share of the luxury market such as BMW, Armani, W Hotels, Louis Vuitton and Rolex ‒ just to name a few. These have given way to consumers to buy products that they associate with a “luxurious life.” They are essentially a status symbol.

The luxury lifestyle in the services domain

In the category of “services”, the luxury lifestyle is all about execution in delivering an exceptional experience with pizzazz to the discerning ─ whether it is a bespoke travel excursion in an exotic place, producing an exceptional dining experience or organizing an over-the-top event, each one ought to create a pleasant memory which would want to be repeated.

A successful service related luxury lifestyle exists when the following take place.

– Delivered with passion
– Exclusivity
– Discretion
– Exceeding expectations
– Seamless
– Refined
– Posh
– With attention to detail

Consider American Express − most notably for its “by invitation only” Black/Centurion card. For hotels, worthwhile mentions are the Hotel Plaza Athenée, the Four Seasons (including its private jet tours), the Ritz Carlton, and boutique hotels Hotel du Cap and Hotel de Crillon to name a few prominent ones. They splurge and provide the perfect luxury experience with outstanding service, exclusivity, and pedigree.

Exclusive and bespoke travel companies provide tailor made adventures and excursions. The four key players in this category include: Abercrombie & Kent, Kuoni Travel, Orient-Express and Cunard Line. Broadening our view of luxury services, certain firms offer services and privileges to a rare percentile. Such services include fractional jet ownership such as NetJets and FlexJet, as well as global concierge services such as Quintessentially.

In the final analysis

Whether offering a product or service, it is how a luxury brand delivers an experience that distinguishes it and makes it stand-out from the mainstream. In essence, it’s a holistic approach.

Luxury lifestyle brand offerings should be constantly refreshed, giving discerning customers a reason to repeatedly do business with the brand. Tiffany & Co., decided to undergo “investing in the theater of shopping in its stores”, as its CEO Frederic Cumenal implied as regards to the renovations of its largest store ever which it opened in China.

Selling a distinct lifestyle is what discerning clients crave and gladly relate to. Organizing exclusive by-invitation-only events should be considered. Exclusive events make one feel notable. For example, Italian sports automaker Maserati invited a select number of brand loyalists to a new experience in Europe that gave them the opportunity to sail on-board the 70 ft./21,3 m Maserati sailboat. In addition, they drove models in its current range including the new Maserati Gran Turismo Sport model.

In the end, living the luxury life is irresistible to many from every range of background and nationality. The temptation includes the aspirational affluent.

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Consumer Packaged Goods (CPG) Marketing Tactics: Spending Less and Generating More Exposure & Revenues

by James D. Roumeliotis

Hexagon Honey Packaging

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When it comes to marketing food products, known in industry jargon as “Consumer Packaged Goods (using the acronym “CPG”), it takes more than mere advertising. Any brand with a deep advertising budget can do so. However, the skill is in knowing how to best utilize a limited budget for maximum effectiveness. Surprisingly, many smaller brands seem to be running circles around their much bigger brand counterparts with greater resources. The key differentiator is in the strategy and implementation including the ideal target market, brand positioning and specific media sought.

Guerrilla marketing: Getting noticed on a shoestring budget

Persuading consumers to consider your product on their shopping list takes time and an ample marketing budget. However, getting consumers to take notice of your product can be swift if a combination of Guerrilla/unconventional marketing tactics are used in conjunction with unique packaging design.

The term “Guerrilla marketing” refers to an unconventional and bold approach for a business to promote its products and/or services in ways that capture the attention of potential customers. They are creative, memorable, attract people’s attention (some may be controversial) and require a limited budget which makes it ideal for small to mid size businesses. “Guerrilla marketing” was originally coined in 1983 by Jay Conrad Levinson who also wrote the book “Guerrilla Advertising” with subsequent editions and derivatives which followed.

In keeping with the CPG theme, Nestle’s Kit Kat candy bar brand utilized Guerrilla marketing by placing creative candy-themed benches across large cities as the image below depicts.

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Today, if a brand, especially a new arrival on the market, wants to stand-out in a crowded marketplace, it ought to consider the following means and tactics.

Online/digital Content marketing: This is absolutely the medium/platform which should not be overlooked. Even large brands are placing more emphasis with digital in their integrated marketing strategy. Content is released frequently but in small doses utilizing Twitter, blogs, Linkedin etc. along with stunning lifestyle images and video with must view material (Instagram, Pinterest, Facebook, YouTube, Vimeo to name the most prominent digital venues).

Public Relations: As this is earned media, what is stated about a brand from a third party is considered trustworthy. Creating buzz through the media, including the use of press releases, is an inexpensive way to earn publicity in lieu of traditional advertising spend.

Alliances – associations – sponsorships: These are additional considerations to boost exposure which turns-out to be a win-win for both parties (sponsor and sponsored party/ beneficiary).

Storytelling: A brand should include storytelling which places an emphasis on the brand’s heritage, the reason for being and why it is offering such a product or products. It is more than content and a narrative, it is a picture made up of feelings, facts and interpretations.

Food packaging: Eating with our eyes

The value added in design, craftsmanship, branding and overall quality can elevate a product into an epicurean delight. Clever and innovative design significantly increases sales and improves brand performance. In addition, it can do plenty of silent marketing. Consider Toblerone, the Swiss chocolate bar brand, whose distinctive yellow triangular packaging and equally shaped product inside is instantly recognizable. It undoubtedly portrays a premium product yet offers a good value for the price. The brand’s marketing spend is much less than its competitors, though its sales and profits are known to be exceptional in its category.

There are many ways of seeing the value of design. For instance, you can measure sales and relative value as an output of changes in design. Design can also improve your standing among rivals and give you a competitive advantage. The Design Council published a report where facts and statistics concerning the value of design are highlighted. One interesting statistic is that design conscious businesses can expect a return on their internal design investments as high as 125%. That’s quite an impressive return compared to other types of investments made in a business.

What may be obvious is that if you have high quality design, you do not need to compete with your competitors on price. If the design of a product packaging has a “wow” factor to make it stand-out on the shelf, then consumers will choose it even if the price is slightly above the competing products. If the product inside is as good as its packaging, customers will enjoy what you have to offer and continue to be loyal to your brand. That is the result of offering something unique and of a higher standard.

Lifestyle marketing: Non-traditional methods to reach modern consumers

Generally speaking, a brand that is designed for a lifestyle should have a much higher emotional value to consumers than one based solely on features, benefits and cost. A study from the Kellogg School of Management revealed that brands serve as a means of self-expression along with the limitations of expressing a consumer’s identity through brands. The goal of a lifestyle brand is to become a way that people can utilize it to relate to one another. Those brands are an attempt to sell an identity, or an image, rather than a product and what it actually does.

Two CPG brands which have joined the lifestyle bandwagon and spending more money and resources away from traditional marketing are Oreo and Red Bull. The former has created one article and image on the pulse of pop culture per day for 100 days with not much revealed of what would come next. Red Bull which spends a staggering 30% of its revenue in marketing and sponsorship events, has also launched a magazine with over five million subscribers, including a record label and two film studios to produce its lifestyle and experiential material.

Healthy eating and acquiring new tastes are modern day trends which can’t be ignored by CPG marketers. Smaller portions are also a recent trend which equate to less calories for consumption along with much focus on natural and non-GMO ingredients.

Creating new categories and uncontested market space

Instead of competing head-on in the same product category, as the majority of brands are accustomed to, consider creating an entirely new class which will be in an uncontested marketplace. This approach is known as Blue Ocean Strategy®. It was developed by two professors at INSEAD, W. Chan Kim and Renée Mauborgne who are also co-authors of Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business Review Press). As they put it, they observed that companies tend to engage in head-to-head competition in search of sustained profitable growth. Yet in today’s overcrowded industries competing head-on results in nothing but a bloody “red ocean” (as in cutthroat competition turns the ocean bloody red) of rivals fighting over a shrinking profit pool. Lasting success increasingly comes, not from battling competitors, but from creating “blue oceans” of untapped new market spaces ripe for growth.

Blue Ocean Strategy Chart

An intriguing case study which puts the above strategy in perspective is Australia’s Casella Wines. In 2001, it entered the overcrowded and highly competitive wine industry in the U.S. with its Yellow Tail brand. By the end of 2005, it had reached sales with 25 million cases ─ achieved on a limited marketing budget. This triumph placed Yellow Tail in the category of the overall bestselling 750ml (25.4 U.S. fl. oz.) red wine, outstripping Californian, Italian and French wine brands. It accomplished this by applying the Blue Ocean strategy framework. Consequently, Casella Wines’ Yellow Tail brand targeted the beer and ready-to-drink cocktails in the U.S. market and created Yellow Tail to be easy drinking, an informal selection, fun and an adventure ─ in essence, an uncomplicated, fruity wine structure that was instantly appealing to the mass of alcohol drinkers.

A category which should not be ignored are Millennials (aka Generation Y). They are projected to spend $65 billion on consumer packaged goods (CPG) over the next decade, yet there are many misconceptions and challenges in reaching these shoppers, according to a white paper by WPP’s Geometry Global. Millennials are the largest generation since the Baby Boomers. They are known to be quite sophisticated, technology wise, unaffected by most traditional marketing and sales pitches. As a result, CPG companies should adjust and innovate to stay digitally connected with the Millennial consumer.

Sensorial branding: Exploiting the senses

In keeping with the spirit of the five senses, you can exploit them entirely to create a favorable experience in synergy, for guests and clients alike. Below are some of the most important factors:

SIGHT – choice of packaging, its design along with its images, the font type and colors. Add to that a stand-alone point of purchase (POP) display.

TOUCH – the feel and ergonomic design of the packaging. This is how the consumer interacts with it. Plenty of emphasis should be placed on this when designing the package.

TASTE – finding the perfect balance between sour, salty, sweet, and bitter. Food product samples ought to be available as consumers would prefer to try a product they are exposed to for the first time. Presentation is equally important which has an impact on the overall image of the setting.

SMELL – it is all about the smell of the product. This sense is closely linked to emotion and memory. You can use something like computer controlled scent machines to entice. Sensory technology can be very influential down an aisle. Case in point: a French bakery café can deliberately use ventilation to deliberately spread the smell of roasted coffee and baked items sold to induce clients to make or increase their purchases. A company which is known to furnish such state-of-the art equipment is Scent Air Technology.

By integrating the brand-building strategies to appeal to all, or most of the senses, sales have actually increased.

At the end of the day

Marketing done well can improve your brand’s awareness, lead to more sales, word-of-mouth, as well as gain client loyalty.

Using clever marketing approaches which do not cost a fortune, along with innovative and attractive packaging, can lead to impressive sales. However, to develop repeat purchases (think “sell-through” at the retail level), the product itself should taste good and produced with quality ingredients.

Stay in touch with your customers via social media interactions and occasional email newsletters and a blog. Do what you can to improve the lives of these people with valuable advice and special offers. The product should exude that it occupies a part in a pleasant lifestyle.

Remain true to what is making your CPG brand a success and refuse to become complacent. Keep refining, innovating, never mislead (through false benefit claims and nutritional information) and engage constantly with your loyal clients. These activities are not deemed a onetime event but rather an on-going process.

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The Top 10 Most Read Articles in this Blog for 2015

by James D. Roumeliotis

Top 10 Articles for 2015

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As in every year, I have once again rounded up the ten most read/popular articles — this time for  2015. The following ten captured the most attention by numbers and from 154 countries in all. See them all below in descending order.  Your views are always encouraged including subject matter you think I should be covering more of.

THANK YOU for your readership and I look forward to feeding your mind with much more business practical food for thought this year which can be applied for timely results.

1 Luxury vs. Premium vs. Fashion: Clarifying the Disparity

2 Perceived Quality: Why Brands Are Intangible

3 The Art of Selling Luxury Products: Brand Story Telling & Persuasion

4 Mass Customization & Personalization: The Pinnacle of Differentiation and Brand Loyalty

5 Exceeding the Hotel Guest Experience: Anticipating and Executing Desires Flawlessly

6 Brand Awareness: the influence in consumers’ purchasing decisions

7 The Ultra Luxury Purveyors: Lessons from brands catering to the richest 1 percent

8 Identifying and Catering to the Discerning Consumer: Quality and Service Above All

9 Start-up Essentials: A Universal Roadmap for Starting a Business — Infographic

10 Product Features vs Benefits: The Brand Differentiation

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