Pepsi Kendall Jenner Ad

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Pepsi got into a crisis after releasing its latest ad campaign featuring the 21-year-old reality star/model Kendall Jenner. The message is that we should all unite and “join the conversation”, however, many people found the ad failed to deliver the message.

In the short film, Jenner was leaving a fashion photoshoot to join a protest. She simply handed a police officer a Pepsi and the crowd started clamping and cheering.

The content of the video was criticized by the internet for making protest like BlackLife Matters seem like an easy problem to solve-with a soda. Within 48 hours the video got around 1.6 million views on YouTube. People also vented their anger on Twitter and Facebook. They thought this was a tasteless action of the company.

The company took down the ad and apologized. “Pepsi was trying to project a global message of unity, peace and understanding. Clearly, we missed the mark and apologize,” Pepsi said in a statement.

Editor’s Note:

Even as a person who’s never been to any protest, I felt uncomfortable while watching the Pepsi ad. I understand that the company is not intentionally trying to state a political message here as their only goal is increasing sales, however, I felt they failed to deliver the message (which is a good one) by using the wrong story telling.

First of all, I think they used the wrong person for the ad. It would make more sense if they feature everyday people or activists of certain movements to be the main character, Having a 21-year-old reality show star handing a soda to the cop does not seem like the best way to tell the story.

Second, most people got agitated because the ad made solving a protest too easy, which is disrespectful to people who contributed so much, even their lives to those protests. This is a serious matter so that it should be discussed in a serious way.

Heineken, a beer brand, showed us a perfect example of good story telling. The ad addressed several current heated topics such as climate change, transgender, and feminism. It seems impossible to touch upon these difficult subjects in a beer commercial, but Heineken did a great job delivering the message-united. It was a successful ad because it was honest, responsible and clear.

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Heineken | Worlds Apart | #OpenYourWorld

 

The Competition Between LivingSocial and Groupon

LivingSocial

LivingSocial is an online marketplace that allows its users to buy and share things to do in their city. In 2013 LivingSocial has about 70 million members around the world. Tim O’Shaughnessy, LivingSocial CEO, said that”We’re the connection tissue between merchants and customers, and that manifests itself in different ways. We think we can redefine how people are interacting with another.”

One of the four cofounders of the company, O’Shaughnessy graduated from Georgetown University’s McDonough School of Business in 2014 and joined Revolution Health afterward. He left Revolution Health in 2007 and started a new business, “Hungry Machine”, which is a popular viral app name “Visual Bookshelf” that allowed users to share book reviews with friends. Due to the success of “Visual Bookshelf”, O’Shaughnessy saw the opportunity of leveraging user data.

Groupon

Groupon is a Chicago-based group buying website that offers daily deep-discount deals to local business. Andrew Mason started Groupon in Chicago in November 2008, which was nine months ahead LivingSocial. It was the fastest company in history to reach $500 million in annual sales. Groupon grew from 140 employees in 2009 to more than 7,000 in spring 2011 and could rely on more than $950 million in private equity financing.

Editor’s Note:

Groupon and LivingSocial have similar websites, and allied deal prices. Groupon CEO Andrew Mason recently said on CNBC that his company was “many many multiples” bigger than its nearest competitor. He claimed that he was very confident that Groupon was generating “more than 3” times as much revenue as LivingSocial.

The graph below shows that for both companies the largest section of their members are 34-44 years old. However, Groupon has advantage over LivingSocial among younger customers from 12-17, 18-24, and 25-34. I think the future opportunity for LivingSocial is to increase awareness among young people. In order to achieve that LivingSocial has to communicate with young people on platforms where they are active and in the way that they prefer.

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The Weather Company Case Study

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“Digital and specialized business information products, not television, are two of the biggest drivers of growth for The Weather Company, parent of The Weather Channel. Today, b-to-b products represent 10 percent of revenue. In the next three years, that percentage will double, thanks to big data and the ability to integrate into customer workflows.” -The Weather Company COO, Chris Walters

The Weather Company was the most widely known name in the weather business. Founded in 1982 with its roots in cable TV, TWC is now facing the challenge of transitioning from traditional TV to digital.

TWC has two revenue streams. The first one was advertising revenue from consumer ads displayed along TWC’s weather data, no matter on TV, its website, or its mobile app. The second was the weather data and the expert analysis it marketed to corporate clients. For example, Home Depot and American Airlines incorporated weather data into their buying decisions so they could more accurately predict what products or services would be needed and where.

In order to shift to mobile, TWC’s Digital Division decided to utilize the company’s big data to acquire new customers and deepen the relationship with existing customers.

The running app market was highly competitive. TWC’s app, OutSider, aimed to provide both weather data and motivation to runners. “OutSider provided accurate and real-time weather forecast, allowing users to plan better-when to run, what to wear, and how to hydrate.” In addition, their competitors like Runtastic did not provide highly accurate detailed weather forecast like OutSider did.

Editor’s Note:

The TWC case is a great example of a company’s renovation on leveraging big data. The success of TWC could be attributed to the company’s big data platform and processes. Another crucial reason was visionary leadership. The leader of the company was able to predict a future trend and pursue it to develop new market. In today’s world, we can all learn a lesson here from TWC’s vision and renovation.

Despite the good start, TWC was facing key challenges ahead. One of them being how would TWC be able to maintain its competitive advantage with its weather-centric running app. As well as location and weather, what other data could TWC incorporate into the OutSider app to make it the go-to running app and a source of premium advertising revenue? I believe that TWC’s strength over its competitors is professional weather data and weather forecasts, therefore as long as they leverage their unique service and concentrate on that they will be able to maintain leader in the industry.

L’Oreal Case Study – Distinguishing Fads and Trends

“Having seen the innovative campaigns that competitors and other industries had implemented, she was convinced that social media could be a game-changer in the hair colour market.” 

The case discusses an innovative social media strategy by L’Oréal Paris, which is to ‘listen’ to consumers and then create product to meet consumers’ requirements and needs. First, the company utilizes Google to track emerging styles and decide which style will stay in a long term. Then it uses social media in choosing where to place the product, how to release it and the name of it.

One of the biggest challenges of the beauty and fashion industry is to distinguish fads from trends.

Fads are style that rise quickly in popularity and then burn out, usually within a year.

Trends last longer – over time they may become “classics”.

Marketing teams in cosmetics often ask four questions:

  1. Is the item/style compatible with a change in consumer lifestyle?
  2. Does the innovation provide real benefits?
  3. Is the innovation compatible with other changes in the marketplace?
  4. Who is adopting the trend?

If the answer to all the questions above indicates an innovation or style that has enduring qualities, it may be a trend instead of a fad.

For example, Harem pants (as seen in image below) were first seen by millions on M.C. Hammer in 1990, and again on Justin Bieber in 2013. In 1990, the style was welcomed by regular consumers quickly because the pants were comfortable and inexpensive. However, it turned out to be a fad because they were inappropriate in professional environment and were not very flattering.

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Editor’s Note:

In today’s world companies are able to obtain loads of information and data from social media. However, companies have to distinguish fads and trends to make a marketing decision rationally. It is also crucial how they integrated social media into the marketing strategy. It needs to include how to deliver the product to consumers, how it should be branded and named, the price point, and how it would be communicated to consumers. Social media like Facebook became a platform that brands adapt to “push” their new products to consumers. For example, Dior’s Facebook page incorporated beautiful photography as well as information about new products. WIth 12 million likes in 2011, Dior consumers interact with the brand on the social platform.

Case: OMBRE, TIE-DYE, SPLAT HAIR: TRENDS OR FADS?: ‘PULL’ AND ‘PUSH’ SOCIAL MEDIA STRATEGIES AT L’OREAL PARIS

United Breaks Guitars, and This Time Human

In these postmodern times where every interaction with the customer is a marketing event, the real crunch point comes when the customer meets your customer-service department. -Advertising Age

A disturbing video captured by a United passenger went viral last Sunday and inflamed the whole internet. In the video an asian male passenger was dragged from his seat by a security officer with blood covering his face.

As I was wondering what kind of “crime” this passenger committed that caused his mistreatment, I learned that in fact he did not break any law or any rules. The flight was overbooked that day and United workers picked four passengers to get out of the plane. This passenger refused to be bumped from a plane as he claimed that he was a doctor and had to meet his patient. And then we saw what happened to him in the video.

Tyler Bridges, a passenger on Sunday’s flight, posted the video on Twitter. Till now the United stock price has dropped by 2.5% and the media commented it as the worst airline stock that you can buy.

This is not the first time United Airlines encountered a social media crisis due to its mistreatment of its customers. In 2008, Dave Carroll and his band were traveling from Halifax, Canada  to Omaha, Nebraska. While boarding his connecting flight in Chicago, his band noticed reckless handling of  passengers’ luggage, and Dave and his band suspected the case carrying Dave’s $3,500 Taylor guitar was dropped. When Dave arrived in Omaha, his fears were confirmed, and his guitar was broken

Dave wrote and posted a song, United Breaks Guitar, on YouTube. The song generated 1.6 millions views and caused United Airlines stock price to drop from 14 to lowest -3 percent. The brand image was largely damaged.

What could United have done differently to avoid the crisis? I have three recommendations below.

  1. Monitor Social Media

Hire a digital marketing team to monitor social media activities.

  1. Improve Customer Accountability

Improve customer service quality by training employees to better serve the customers.

  1. Efficient Crisis Management

Turn a crisis into a marketing opportunity by having a faster response on social media channels (Myspace, YouTube, Twitter). Most importantly, they should have the CEO apologize on TV,  magazines, newspapers, etc.

 

The Nokia N8 ‘Push Snowboarding’ Campaign

“Push Snowboarding was a bold step that used social media to develop the product, generate awareness and engagement, and increase brand and device preference. No other company had blended social and traditional media in this way.” -David Dubois

Case Summary

Nokia released N8, a touch screen smartphone that has connection to apps, on 23 September 2010 at the Nokia Online Store. The company decided to apply social media marketing strategies instead of merely focusing on traditional media platform. At that time, other tech companies in the industry were cautious with their usage of social media. Apple only used social media for sub-brands such as the App Store and iTunes on Twitter. A number of brands had failed in using social media platforms efficiently and some of them even paid a good price for it.

Hyper, the creative agency hired by Nokia, recommended creating a strong online community to help speed up product adoption and development of N8. The community that Hyper found was the aspiring snowboarders. Through a partnership with Burton, who has been the world’s most popular snowboarding brand since 1987, Nokia increased awareness as well as authority in snowboarding community. Nokia sponsored the Burton US Open, where the campaign was broadcasted on Twitter and YouTube. The goal was to use TV ads, Tweets and YouTube videos to direct traffic to the website.

Nokia’s innovative social media strategies yield excellent results. The campaign reached approximately 290 million people across the world through social media platforms. Twitter was one of the most effective platform with a reach of 8.2 million.

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Editor’s Note

I think the key success factor that made this campaign go viral is that Nokia found an effective customer community and the best way to communicate with them. As a result, the N8 Snowboarding campaign led to a drastic increase of product awareness as well as brand engagement.

However, one thing that we need to keep in mind is that it was a risky move. Given the example of Southwest Airlines in the case, a company could lose control of the brand in social media platform. I believe it is necessary for a brand to prepare a contingency resolution plan to maximize the risks.

The Four Giants: Amazon, Google, Apple, and Facebook

The four giants of the Internet age – Google, Apple, Facebook, and Amazon – are extraordinary creatures. Never before has the world seen firms grow so fast or spread their tentacles so widely …. The digital revolution these giants have helped foment has brought huge benefits to consumers and businesses, and promoted free speech and the spread of democracy along the way.” – The Economist, December 2012

Amazon: Web Services

Nowadays people no longer consider Amazon as merely an online bookseller, which was how it initially began its business in 1995. The company turned in a $5 million profit in 2011 and its global revenue reached about $57 million as 2013 began.

Web Services and credit card payment contributed to about 4% of Amazon’s net revenue. Though this is a small fraction of the revenue comparing to books together with digital media that generated 37% and general merchandise that contributed 59%, Web Services is revolutionary to the traditional online-retailing. What is Amazon’s Web Services?  For example, companies like Dropbox, Reddit and the New York Times could purchase flexible information-technology infrastructure services from Amazon and pay for what was used.

Besides Web Services, Amazon’s marketing and advertising for its suppliers had played a key role in Amazon’s business model. In 2011 Amazon initiated an advertising network that tag a visitor with tracking cookie that remind them in another network or website of things that they browsed but failed to buy.  

Google: Acquisitions

Launched in 1998, Google at that time only offered search function so that it earned zero revenue. In 2000, Google started to sell text advertising to advertisers who want to reach people who were searching particular keywords.

In the following years, Google made a few acquisitions and developed new products that helped the company expand sources of revenue. In 2003 it introduced Gmail, in which enabled advertisers to place ad matching particular e-mail messages. In 2006, Google bought YouTube for $1.65 billion. The website profits by earning payments from advertisers while providing free services to both video uploaders and video watchers. Now YouTube is positioned as a competitor to cable-television.

However, not all Google’s new developments were successful. Google was facing great challenges from its competitors such as Amazon and Facebook. For example, in 2011 it launched a social network called Google+. With the intention of competing with Facebook, Google+ had only 20% unique monthly users that Facebook had.

Apple: Battle with Amazon and Google

Apple’s success is no doubt legendary. The sleek and smart design of its products fascinated people and had won the brand numerous loyal supporters. Apple was found in 1976 and had become the most valuable U.S. public company of all time in 2013.

However, the brand is ambitious and has always been seeking new opportunities. Apple had been competing with Amazon’s Kindle platform with a combination of iTunes and iPad. Even the Kindle was made for books, the iPad was trying to replace it as a solution to a broader range of digital content. Apple’s siri was also in the battle with Google’s search function.

Facebook: Dominating Time  

One key advantage that Facebook has over Google and is that people tend to spend longer time on it. The average Facebook visitor spent 6 hours and 41 minutes on the site per month, whereas users of Google only spent 1 hour and 54 minutes per month. The online population today is mostly social-media population.

Advertising consists of the majority of Facebook’s revenue. When a person likes a brand on Facebook, the brand can buy the right to advertise on the page of this person’s friend to drive traffic.  

Editor’s Note:

The market of digital advertising will be highly fluid in the future due to the strong competition among the four giants: Amazon, Google, Apple and Facebook. Even though advertisers will be facing the dilemma of picking the best company to collaborate with to maximize the effectiveness of their ads, I believe that the competition will encourage the four giants to evolve into stronger companies. Advertisers and consumers will benefit from their competition and receive high-quality services.

One important skill that the four giants require will be branding. When a consumer can read a book on either Amazon’s Kindle or Apple’s iPod, it becomes crucial which brand the consumer favors over the other. Customer service is a key part of branding since people tend to be loyal to brand whom they received great customer service from.