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al berrios & co. IMKTG REPORT 01.28.03: Prediction: Media, Martha, Unions
THIS WEEK'S CONTENTS ARE:
[1] JUST SAY IT: al berrios & co. Updates, Corvette
Consumer Study
[2] BRANDSTRATEGY: Martha Leaves K-Mart?! Understanding
Cult Audiences
[3] CONSUMERFOCUS: Fees & Discounts for Uninformed
Consumers
[4] MEDIA: Conference Coverage: Predictions on the State of
Media
[5] MANAGEMENT: Preventing Service Professionals from
Unionizing
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[1] JUST SAY IT: al berrios & co. Updates,
Corvette Consumer Study
Good morning execs,
Great news - the "IMKTG REPORT knowledge portal" is now live. Access it at www.alberrios.com by following the links to IMKTG REPORT. Let me know what you think. It's a database of each IMKTG REPORT since July 23rd, 2001, categorized by data, subject, interviews, guest writers, and brands. The portal will feature al berrios & co. original ideas, external research and resources all related to understanding consumers better and guide your corporate strategy.
Our first feature, for those of you interested in GM brands and the sports car consumer, is a consumer study on the Perception + Media Habits of Corvette Consumers. Using a target audience of 50 high-income, male consumers, a research team associated with al berrios & co. went out into the field to understand this consumer better. The team consists of Abigail Carlos, Diana Dang, Achmad Rundi, and Dennis Villas. Whether it's new to you or not, check it out - you may find our approach interesting.
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[2] BRANDSTRATEGY: Martha Leaves K-Mart?! Understanding
Cult Audiences
What else can possibly happen to K-Mart? Still looking a consumer niche? Still tweaking inventory? Finally got rid of the old guard (and making them pay, as I'm sure you're read by now). But consider this: Martha Stewart, the savior and staunch defender, will leave K-Mart within the next 4 to 6 years. Not to Target or Wal-Mart, but to open her own retail outlets, where an often cited "control freak" can truly exist. And even though opening up stand-alone retail outlets is a contrarian strategy, if Apple can get away with it, depending on it's cult audience, then so can Martha. K-Mart will be left with some sort of reduced licensing agreement, but no longer be able to sell over $1 billion in Martha branded goods. If they haven't already, expect K-Mart to cultivate new and several similar home arts brands in anticipation of reducing their dependence on Martha.
BOTTOM LINE: It's an interesting thing, how cult brands program consumers. Not even politics can deter them. A true sign of a cult brand is its polarizing affect on consumers. You have the followers, but you also have the haters. Both are adamant about their feelings, relegating the brand to a permanent niche status. None of the legal issues facing Martha seems to have affected her sales negatively. Although growth has stalled, MSO continues to enjoy successful new product launches and relationships with advertisers. Why? Because Martha's consumer isn't (generally) a banker or lawyer, and they don't care about Martha's mess, as long as Martha continues to offer the same quality products and advice they've come to depend on her for. This type of consumer mindset is very difficult to program, but once it's done, it's virtually unchangeable. Steve Jobs did it. Martha did it. And based on her strategic direction in the last 20 years, it's a clear bet she's going to have her own outlets pretty soon.
READ MORE:
http://www.beloit.edu/~amerdem/students/rottenstein.html
(at the bottom of page)
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[3] CONSUMERFOCUS: Fees & Discounts for Uninformed
Consumers
Do you use a supermarket club card? At the end of your purchase, are you one of those folks that looks for each minus sign on the receipt with glee? Do you spend more time perusing eBay auctions than your kids' homework? Do you passively accept as your fault every time your bank charges you an overdraft fee, or your credit card, a late fee? These days, consumers value one thing above all else - pleasure. It has made us an impulsive society, perpetually seeking the next source of cerebral stimulation with absolute trust, from our great department store gods, with little regard for the little details. But wait, do the gods deceive us? Turns out those supermarket club cards are simply regular sales that aren't accessible to the general public IN THAT STORE! If you went across the street to the supermarket without a club card, you'd probably save more money, since all sales are available to all shoppers. And those overdraft fees - your bank actually encourages it, since they make billions from it. Is it legal to let you continuously run over your limit, then make you pay it back? The Fed is looking into it. Although consumer ignorance is a great opportunity waiting to be exploited by a company, is it worth the risk of having us consumers discover their practices?
BOTTOM LINE: Unfortunately, the answer is yes. Even if we consumers did find out, we're a minority. In the meantime, companies are making plenty off the majority because even if we wanted to question their practices, we wouldn't know how, since they prominently hide all their contact information on our statements. In addition, an overwhelming amount of media and advertising, in combination with our decreased attention span, increased responsibilities, and an inability to understand or opine about the status quo have left many of us mere lemmings to be taken advantage of. I say, let's continue to be blissful in our ignorance, as companies continue their impulse-based profit strategy, making us purchase more things we don't need for events we don't celebrate for people we don't want to shop for. In the long run, even though we live in a virtually transparent society, we will continue to accept all advertising as facts, ignoring any information that requires more than 30 seconds of concentration, and seeking pleasure any way we can, to satisfy every influenced and unquestioned impulse. But you thought you had a choice - you do, it's up to you to realize it, though. Companies won't remind you.
READ MORE:
Some
Banks Encourage Overdrafts, Reaping Profit
On
eBay, No One Can Hear You Scream (Over High Price of Hot Toys)
The
Discount Grocery Cards That Don't Save You Money
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[4] MEDIA: Conference Coverage: Predictions on
the State of Media
This week I attended the "Conference Board/FutureBrand 2003 Corporate Image Conference: Going Beyond the Expected" and "Bear Stearns Media Presents The 4th Annual Advertising/Marketing Virtual Summit, 2003 - 'The Battle for Ad Dollars'". Each event featured the senior executives of media associations and advertisers, presenting their industry outlooks and forecasts, as well as exploring innovative strategies.
BOTTOM LINE: Interesting predictions include: Latino audience has become such an important growth area for advertisers that much more new content & programming will emerge to serve every aspect of this consumer group, (the Wall Street Journal and New York Times reported last week that Hispanics have surpassed blacks as the "biggest minority". Although I went to see for myself at Census Bureau's site, I find the numbers not entirely convincing); expect a media buying agency de-consolidation due to client-side complaints and evidence from FCC reports indicating how these larger agencies never really ended up paying less for media; Nielsen has lost popularity, but without a significant competitor, companies don't have a choice; Agencies and advertisers need and want minute-by-minute ratings and improved viewer coverage; expect newspapers to continue to struggle in figuring out how to get younger readers; expect more creative-based, not technology based, innovation in online media strategy; expect international syndication of American programming to decrease as American influences on international cultures wanes and international broadcasters develop in-house programming catering to local tastes that's also cheaper to produce than the increasing fees demanded by American studios (U.S. TV Shows Losing Potency Around World)
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[5] MANAGEMENT: Preventing Service Professionals
from Unionizing
Last summer, I applied to teach part-time at NYU. I was rejected because adjunct professors had begun unionizing and the administration decided to take a very aggressive stance on part-time help. "The part-time teachers argue that while their professional skills are equal to those of full-time professors, they are denied equal pay, benefits and treatment." Although I didn't understand the problem at the time, it appears that an institution risks losing prestige if they don't maintain a certain amount of professors on staff . However, the institution makes the same amount of money from a student whether they are taught by a tenured professor or an adjunct, making adjuncts a clear profit center. From a practical standpoint, if any service professional brings in more revenue/sales, then their value to the company increases, and they consequently deserve increased compensation and attention. If blue-collar laborers can unionize to gain that attention and a voice at the management table, why not white-collar employees? It's no secret what all employees want - to be able to do a good job, work safely, and earn fair and stable income and benefits. But if it's so well known, why do executives continuously ignore or disregard their workforce?
BOTTOM LINE: The need for a union is a clear indication of the disconnect between the lower ranks and the higher ranks. Why are executives still not fully aware of what their workforce needs and wants? Effective employee relations eliminates the need for unionization - in any working class. Although this recommendation may appear very simplistic and general, companies continue to face the threat of disgruntled employee groups, (like a boycotting public) without a clear understanding of the dissatisfaction, a manner of addressing it, nor a strategy to correct the problem. In the end, this affects your entire organization's relationship with consumers, and no matter how much you try to deny it, your bottom line. A successful organization starts with a successful relationship with your employees. And a program within a service organization or institution, riddled with long, pointless meetings and discussions to gripe about problems that will never get solved because managers filter to directors, directors filter to VPs, and VPs filter to presidents isn't how you, Mr. CEO, will solve your employee relations challenges. In essence, preventing unionization is as simple as addressing real employee concerns, directly from them, not your direct subordinates.
READ MORE:
NYU
adjuncts prepare to unionize
Wooing
White Collars
Two
Brothers Confront Columbia Over Payment of a 'Dean's Tax'
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