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UPCOMING EVENTS
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| Has your company done location-based promotions with your retailers? Vote and view live poll results |
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Recent Poll: Only 6% think Walmart will dominate the 3-D TV market this year. See results below. See full results below. |
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I came across this article recently, about use of mobile devices and location-based advertising. It tells us that about a quarter of us have used mobile location-based services (such as GPS or mapping services on cell phones), and that these users “are more likely to respond to mobile advertising delivered with location-based targeting than regular ads.”
Most respondents said that they used location-based services to locate nearby "points of interest, shops, or services." What's more, roughly half of those who noticed ads during their use of a location-based mobile service took some kind of action.
A quick note – the survey was done by the Mobile Marketing Association, which means that it may not be totally free of bias.
That said, what struck me as I was reading it was that mobile location-based advertising takes us back to the original purposes behind co-op advertising (back when that was its name). Although co-op can be traced back to the late nineteenth century, it began to be a major force in marketing in the fifties and sixties, when it was positioned as a supplement to national advertising. It was recognized that, while national advertising could convince prospective customers that they needed and wanted a given product/brand, co-op could finish the process by telling them where to buy it and what it would cost. The process looked like this:
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While we may have moved on to new terminology, and also moved beyond many of the old ideas that lay behind co-op advertising, the basic rules of marketing haven’t changed, and it’s fascinating to see how new technology and new media fit into the old patterns. What’s also interesting is that location-based mobile advertising offers an opportunity to perform the co-op ad function closer to the moment of truth. It is thus something of a step between an ad in traditional media and an in-store sign or display.
It seems clear to me for these reasons, that location-based ads are very much a tool that should be embraced by marketers who are seeking to tell consumers where to buy a specific product – and should therefore be an important part of trade promotion programs.
How much of this is being done so far? Let’s make that our exit question: Has your company done location-based promotions with your retailers?
Can Copyright Law Be Used for Resale Price Maintenance?
Costco has been selling Omega watches that it obtained from off-shore distribution channels. Although Costco is not, of course, an authorized Omega dealer, Omega probably would not care, as long as Costco adhered to Omega’s pricing – which, of course, they don’t.
Omega has sued, using copyright restrictions as the basis of the suit.
The case tests the power of a manufacturer to use copyright law -- normally thought to protect creative works like books and movies -- to "protect" a tiny logo affixed to an expensive Swiss watch. Copyright grants extraordinary powers to an owner, including the right to prevent protected works from being sold or even given away, far more protection than trademark law. But the Supreme Court long ago established the "first sale" rule, meaning once a copyright owner sells a copy of a protected work, subsequent owners can sell it, rent it or lend it out as they see fit. The rule protects video-rental outfits like Blockbuster and Netflix as well as public libraries. In the Costco decision, the Ninth Circuit agreed with prior Supreme Court decisions that the first-sale doctrine applies to works manufactured in the U.S. But the Omega watches in question were made in Switzerland, far outside the reach of U.S. copyright law, and sold to authorized dealers in Latin America. Those dealers then slipped the watches to a gray-market distributor who subsequently imported them to U.S. where Costco sold them at a price that undercut Omega's U.S. dealers. Manufacturers don't like that, even if consumers do. |
The case turns on whether the “first sale” rule applies if that sale occurred outside the US. But the interesting point for us is that this is a backdoor route for price maintenance agreements between manufacturers and their customers in some categories, and will bear watching for that reason.
Recent Poll
We discussed Walmart’s surprising announcement that they will be selling 3-D televisions soon, and wondered if they will be able to dominate that market as they have so many other product categories. So we asked: “Who will dominate the 3-D TV market this year?”
- 6% Walmart
- 36% Best Buy
- 5% Other
- 52% It will be too small to matter
The consensus seems to be that Best Buy will hold the lead over Walmart, but that the market will remain too small to worry about for now.
Stores-within-Stores: Sears Opens Golf Shops
We’ve covered the stores-within-stores idea before, and it continues to gain new adherents who find new applications for the idea. Among the latest, Sears – which will be opening golf shops within existing Sears stores, in partnership with Edwin Watts Golf Shops. Initially, twelve shops are planned.
The shops will be about 3000sf and staffed by Edwin Watts personnel. They will carry brands including Callaway, TaylorMade, Titleist, FootJoy, Adidas, Cobra, Wilson, and Champions Tour.
Online: Digital is 26% of NYT Ad Revenue; Web Coupons; Bloomberg/WSJ
The woes of the newspaper business continue, but there are some interesting twists showing up in the ongoing story. Advertising revenue for New York Times Company was down 6.1% in Q1 -- the good news being that that was the smallest drop in a while. Print ad revenue was down 12%. More of the same, right?
Well, yes and no. While overall ad revenue was down, digital ad revenue was up 18%.
Online advertising revenues have become a much more significant part of the company’s mix, making up 26% of advertising revenues in the first quarter, up from 20% in the prior year. |
The predictions have been made often that, eventually, digital advertising will save the news business. But the question has been whether ‘eventually’ would get here before most of the papers disappear. I don’t have the knowledge or the courage to make those predictions at the moment, but that 26% figure definitely caught my attention.
In other online follow-ups, the web/mobile coupon sector continues to expand, and offers retailers tremendous amounts of information about consumers who use them:
The coupons can, in some cases, be tracked not just to an anonymous shopper but to an identifiable person: a retailer could know that Amy Smith printed a 15 percent-off coupon after searching for appliance discounts at Ebates.com on Friday at 1:30 p.m. and redeemed it later that afternoon at the store. “You can really key into who they are,” said Don Batsford Jr., who works on online advertising for the tax preparation company Jackson Hewitt, whose coupons include search information. “It’s almost like being able to read their mind, because they’re confessing to the search engine what they’re looking for.” |
Although I am not, as a consumer, a person who is particularly obsessed with privacy (I long ago accepted that marketers know a lot about me, and I accept it as a trade-off for receiving customized offers), still, I have to say that I find this a bit creepy. The solution, of course, is simple – don’t use web coupons if you don’t like the data collection. But I wonder if we’re likely to see laws enacted about it soon.
We’ve had a few items about Wall Street Journal trying to kill off the New York Times by launching a local edition (they have confirmed recently that other local editions will follow if New York is a success). But a follow-up is that, while WSJ goes after NYT in print by expanding its non-financial coverage, Bloomberg is expanding its financial coverage and going after WSJ on-line.
Bloomberg is trying to turn its site into the only page someone who cares about business visits. It will have a nice sampling of Bloomberg's troves of data, breaking news, insight, commentary, as well as aggregation of the best business writing on the web. |
The article notes that “Bloomberg wants to kill the FT, Journal, Reuters and other rivals.”
Best Buy Goes Small
There has been a rumor going around (as we noted a few weeks ago) that Best Buy might acquire RadioShack, with the logic being that they would be doing so to expand their mobile offerings. Whether they go the acquisition route or not, it seems plain that Best Buy wants to have a lot of smaller mobile outlets.
Best Buy reiterated its plans to open as many as 1,000 freestanding Mobile stores across the U.S. Best Buy CEO Brian Dunn told the Financial Times that it will eventually have "a number somewhere between here and 1,000" of the stand-alone stores, which will largely be located in shopping malls. The company currently operates 77 Best Buy Mobile stores and plans to add between 75 and 100 this year… |
Marketers Produce Shows / Media Produce Products
We mentioned a few months back that Procter & Gamble and Walmart were teaming to produce a ‘family-friendly’ TV movie, and speculated that similar marketer-produced programming might follow. Later, we noted Red Bull’s sponsorship of the world’s longest free-fall skydive attempt.
But if marketers can produce their own programming and events, then why can’t media create their own products? They can of course. And they always have – most often in the toy arena – but still they can go into it in a larger way, as Telemundo is doing.
Telemundo is increasingly incorporating products into the plot line of its telenovelas, and its newest deals are being made with manufacturers to develop brand new products for viewers to buy - products which didn’t exist before integration with the show. The first products will be jewelry from the Richline Group. The jewelry will be worn by characters in at least 16 episodes of telenovela El Clon, the first of which will air on Telemundo on April 22. The jewelry is already available on the Telemundo website, reports The New York Times. Another line of licensed merchandise, home decor products from Arrow Home Fashions, has been created and will begin airing in telenovelas as well as in the Telemundo morning show beginning in September. |
E-Books: Will They Grow the Market?
Book publishers have been concerned about price-cutting and piracy as e-readers grow in popularity. Their concern, a reasonable one, is that they will see a repeat of what has happened in the music business. For now that doesn’t seem to be a problem, if a recent study is to be believed.
U.S. book sales will rise 5.8 percent through 2015 as more people buy digital versions for Apple Inc.’s iPad and Amazon.com Inc.’s Kindle, even as traditional book sales drop, Goldman Sachs Group Inc. said. Industry wide sales will increase to $24.9 billion in 2015 from $23.5 billion this year, Goldman Sachs analyst James Mitchell said in a report today. E-book sales will jump more than fourfold in the period to $3.19 billion while print book sales probably will fall 4.9 percent to $21.7 billion, he said. Apple’s share of the e-book market will surge to 33 percent in 2015 from 10 percent this year, said Mitchell, who wrote the report with analysts Ingrid Chung, Fred Krom and Jordan Monahan. Amazon.com’s share of the e-book market likely will fall to 28 percent in 2015 from 50 percent this year, and Barnes & Noble Inc.’s share will remain at 15 percent from 2012 through 2015 after rising from 5 percent this year. |
These are very promising numbers. Amazon’s concern has been that there will be resistance among consumers to pay print prices for digital books, while publishers have insisted upon maintaining something close to current pricing. Thus far the publishers have prevailed, with Apple’s help. We’ll see if trying to keep prices up works for them – it’s a model that blew up in the faces of the music distributors.
TPMA and MEI Present:
The Incredibly Shrinking Shelf – 5 Ways to Stay Relevant
Wednesday, May 19, 2010 2:00 PM - 3:00 PM
As store brands have gained competitive advantage as lower-cost alternatives to national brands, CPG manufacturers have found themselves competing more on price, and in some cases even fighting to stay on store shelves. While the economy is beginning to show signs of improvement, shopper behavior may remain price sensitive for the foreseeable future. This free webinar will explore ways CPG manufacturers can fight to remain relevant in the eyes of the consumer in an ever challenging retail environment.
Calvin Klein Marks Its Spot: China
China will be Calvin Klein’s top growth market this year, according to plans. Growth, led by jeans and men’s underwear, will be in the 20%-30% range. “Calvin Klein backed up that forecast last Friday with a spirited runway show and party in a decades-old converted textile factory in northern Shanghai that attracted hundreds of distributors.”
Forbes, 19 April 2010
Saks to Shutter Stores, but Cites Growth Plans
Saks is closing some stores (‘less than 20’), but says that longer-term, it plans to grow. Anything approaching twenty closures could amount to a sizeable portion of the chain, which currently has 53 stores. “According to [the CEO], the outlook is positive, with consumer spending habits on the up-and-up and Saks' adaptation to the evolution of the market.”
NBC New York, 19 April 2010
Family Dollar Bets that Good Economic Times Are Not Rolling Just Yet
Family Dollar thinks it can continue to grow as the economy slowly pulls out of recession. The chain is keeping its emphasis on basics, figuring that their customers will keep a tight rein on discretionary spending, and intends to grow their private label business. “Family Dollar announced strong second-quarter results that included a 33 percent rise in earnings and a 3.5 percent advance in comparable stores sales.”
Bnet, 13 April 2010
"American Trademarks" Traces the Origins of Our Logo Lust
This is a review of a new book detailing over a thousand old trademarks and logos, including those shown below. If you click on the link, you can also check out a video, ‘Logorama’, which was nominated for an Oscar for best animated short.
Fast Company, 8 April 2010
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Kmart Counts on Rebuilding Consumer Demand
It’s been a long time since Wall Street (or anybody, for that matter) said anything nice about Kmart, so it’s worth passing on when we find a positive article. And this one has some good numbers: “The 1,300-store chain has generated two straight quarters of positive U.S. same-store sales, putting an end to 14 quarters of declines. The company's fourth-quarter profit was its biggest in three years.” Admittedly, those good quarters were compared to some very bad ones, but still, as the old song said, “Been down so long, it looks like up from here.”
MarketWatch, 15 April 2010
Manager, Trade Funds
Walgreen's
Deerfield, IL
Responsible for the coordination of pricing, promotion and assortment data to link marketing plans and purchasing/sales execution for top tiered vendors; consult with Chief Merchandising Officer and Purchasing GMMs on vendor negotiation strategies; collaborate with Space Managers to provide recommendations for strategic vendor negotiations to Director of Finance, Retail Operations. Job #000281. For more information, click here.
Sr. Marketing Manager
Microsoft Retail
Redmond, WA
This role is responsible for inbound marketing strategy and execution - from signage and collateral to digital displays and on-screen demos. We are looking for someone with big strategic ideas, partnering acumen, a passion for consumers and an addiction to driving for results. For more information, click here.
Channel Marketing Manager - Office Superstore
ACCO Brands
Lincolnshire, IL
The Office Superstore Channel Marketing Manager will drive competitive advantage through comprehensive category management for our current and new customers within retail, catalog, and on-line segments. This position will translate overall product category strategy into channel strategy by developing compelling and profitable, programs, promotion and placement of products for these customers. For more information, click here.
