Chevrolet Volt Brand Positioning
by Marc on Jul.28, 2010, under Branding, Internet Marketing, Strategic Consulting
GM is hoping its Chevy Volt will become a huge success, and from a product design perspective they might well have a great car. It certainly is the only car that competes in its exact category. From an energy perspective, there will be four basic kinds of cars on the market by the end of this year – the traditional internal combustion engine cars, the hybrids like the Prius and Fusion Hybrid that run primarily on gas but switch to electric at times to improve gas efficiency, the pure electric like the Tesla and the upcoming Nissan Leaf, and the Volt. The Volt runs as a pure electric car until the battery is drained, at which point it seamlessly switches over to its gas engine. So GM is positioning the Volt more directly against pure electric cars like the Leaf, but for people who are nervous about the battery dying on a longer trip.
Compared to the Leaf, which will also be sold in the US by the end of this year, the Volt has a lower capacity battery (40 miles vs. 100 miles) and is more expensive ($41,000 vs. $33,000 – although each qualifies for tax breaks). So, unfortunately for GM, consumers are forced to trade better electric milage and significantly more more money for the peace of mind afforded by the gas engine. It won’t be an easy sell, although it’s possible.
The Volt’s price, though, presents GM with a much bigger sales problem because of Chevy’s brand positioning. Chevy has always been GM’s lower cost, every man’s car (separate from the iconic Corvette). Virtually all of its car models have starting prices of between $10,000 and $20,000. People expect Chevy’s to be less expensive. So the Volt’s price will be its albatross – it doesn’t fit Chevy’s brand positioning. Moreover, people don’t associate the Chevrolet brand with leading edge technology and innovations, which clearly GM is trying to do with the Volt.
GM would have been much better off if they had launched the Volt under the Buick or Cadillac brand. In addition to better lining up the car with the brand’s established position in people’s minds, GM could even have raised the price a little to include a larger electric engine. It would then have a car that beats the competition on all fronts.
The time is coming soon, though, when we’ll see how well GM’s strategy worked. By the end of this year the Volt will be on the market, along with competitors like the Nissan Leaf. As an early indicator, though, consider a few interesting statistics. The Nissan Leaf is significantly ahead of the Chevy Volt in terms of internet search volume (Google Trends) and Facebook fans (Nissan Leaf Facebook page vs. Chevy Volt Facebook page).
Domus is a marketing communications agency based in Philadelphia. For more information, visit us at http://www.domusinc.com.
Lottery Sales Stagnant? Tap into the Youth
by Marc on Jul.22, 2010, under Lotteries
Recruiting non-traditional retailers to help lotteries reach the younger “don’t worry, spend happy” consumers
Most U.S. state lotteries enjoyed near-monopoly gaming status during their early years, with legitimate gaming competition coming only from resort casinos in Las Vegas and Atlantic City. However, times have changed and now the convenience of online gaming and the glitz and glam offered by the latest crop of gaming venues have led avid lottery ticket buyers astray.
Within any industry, the only way to thrive, not just survive, is to continuously evolve and find new opportunities to generate revenue, and the lottery is no different. Some states have joined Powerball and Mega Millions or added instant ticket vending machines. All of this is good, but an opportunity exists for more. We’re overlooking the most profitable untapped market: the get-rich-quick, money-obsessed younger generations who have money-burning holes in their pockets.
How do you target these spend-happy consumers? Simple; expand your retail footprint beyond traditional outlets to reach a wider, AKA younger, audience.
Through the proven success of retailer recruitment, state lotteries can identify, qualify and select non-traditional outlets to grow their sales pipeline and reach the 18-35 year olds that already have wish lists to help spend their not-yet-won lottery millions. Bowling centers, movie theaters, general discount stores, diners and cafes are all breeding grounds for the younger market. Why not leverage them and make their most popular customers your most popular customers?
Domus has been working on behalf of the Pennsylvania (PA) lottery for over 7 years and has successfully identified new revenue streams through non-traditional avenues to expand their retailer base and target an influx of new players including the elusive 18-35 customers. We’ve helped the PA lottery increase ticket sales by 58% in 2009, let us help you.
Google’s Nexus One Android Phone – Success or Failure?
by Marc on Jul.20, 2010, under Branding, Internet Marketing, Strategic Consulting
Google’s Nexus One phone was an interesting marketing experiment – introduce a new, self-branded phone that Google sold directly, not through the wireless carriers. Unfortunately, sales never reached high enough targets and this week Google announced that it has ended production of the phone (through its manufacturing partner, HTC) and is closing its web store.
The questions of why the phone failed and even whether the phone failed are even more interesting, though. We’ll never know for sure, but here are some thoughts.
First, assuming the phone did fail (which we’ll come back to later), one possible reason is that Google did not pay enough attention to its four marketing Ps – product, price, promotion, and place (distribution). Let’s assume that the phone itself was good, so that leaves the other Ps.
First let’s look at the distribution channel (place). Cell phones – more than most other products – are inextricably entwined with their service provider, so attempting to bypass the service provider was already a daunting gamble by Google. Even Apple, which garnered enough interest in its phone independent of the network, still chose a service provider with whom to partner.
The cell phone distribution channel is especially important because of the marketing effort that the service providers put into their phones. First, there’s the next P, price. As everyone knows, you can always get phones for less than the retail price when you buy from the wireless carrier (as long as you accept the two-year commitment). So why buy outside of the wireless carrier? We’ve all been conditioned to think that way.
And finally, let’s consider the last P, promotion. Google didn’t just introduce a branded phone. More importantly, it also introduced a phone operating system (Android) that it hoped to induce others to use in their phones. One of those manufacturers who immediately decided to do so was Motorola. They, in conjunction with Verizon (as opposed to Google’s approach of going it alone), launched a huge advertising campaign for the new Droid phone (“Droid Does”) at the same time that Google started selling its Nexus One. With Verizon’s massive marketing push, everyone knew about Droid, everyone got a good price for Droid, and everyone associated the name, “Droid”, with “Android”. Where did that leave Nexus One? Apparently nowhere.
However, all of the above was based on the assumption that Google did fail with the Nexus One. What if, though, the primary purpose of the Nexus One was to generate enough buzz about the Android operating system to propel all Android-based phones (i.e., Google-based phones) to mainstream success? Once the buzz did its work, the Nexus could happily be retired. In that sense, maybe the Nexus One was an outstanding success. Android-based phones are quickly challening the iPhone for smartphone market share. Google never was in the physical product business anyway.
Domus, Inc. is a marketing communications agency specializing in integrating the digital and social media worlds with classic marketing principles to deliver high returns on investment for our clients. For more information, please visit us at http://www.domusinc.com.
Internet Presence – Pay Attention to Local Review Sites
by Marc on Jul.11, 2010, under Internet Marketing, Strategic Consulting
So many companies put extensive resources and budgets on search engine marketing and brand building advertising. But how many of those same companies apply effective resources to monitor and address online reviews and complaints about their products and services? In reality, “buzz” about you on these sites might well be more important than the number of page 1 Google rankings or any display metric. Today, shoppers regularly go to sites like yelp.com, epinions.com, and others to find out what experiences others have had with companies they’re interested in doing business with. If the comments written about you are predominantly negative – especially in comparison to your competition – then increasing the public’s awareness of you will just increase the number of people who get a negative opinion of you.
So, if you’re not already monitoring these sites and honestly addressing posted concerns, you might want to think hard about your current marketing allocations.
Domus is a full service marketing communications agency that combines classic marketing experience with digital marketing expertise to effectively deliver improved business performance for our customers. For more information, please visit use at http://www.domusinc.com.
iAd JS, Apple’s iAd Development Kit
by Won on Jun.15, 2010, under Internet Marketing, Technical
Apple has officially announced their iAd development kit, “iAd JS”, which enables agencies to develop interactive ads for their clients. As explained in Apple’s technical documentation, it gives more interactive capabilities than any other existing interactive media, including Adobe Flash.
First, it can accept a user’s gestures, not only on the touch screen but also by motion. For example, you can create a banner ad showing a soda bottle, allowing users to shake it until it explodes. Using the kit, you can also develop ads that detect orientation.
Next, the iAd JS provides for integration with social media. When iAd is activated, the user is online; therefore, it can connect to a social network and download dynamic content to the banner. It’s also possible to update real-time status of an advertising campaign, such as competitive or ranking information.
Based on user interaction, it can also store an image generated by the banner to the iPhone’s photo gallery, so users can see ad images on their albums. For example, by utilizing social media integration, an iAd banner can create and save a user’s future baby photo with campaign copy based on a photo identified by Facebook ID.
Domus has full iAd creation capabilities and is actively involved in development projects for our clients. For more information, please visit us at http://www.domusinc.com.
“Project Natal”, “Kinect”, and Naming Strategies
by Marc on Jun.14, 2010, under Branding, Strategic Consulting
Last year Microsoft introduced the world to an up-and-coming technology called “Project Natal”, its Xbox appliance that enables gamers to interact with Xbox games without any hand-held controllers. This week at the E3 conference Microsoft is finally introducing it for delivery this holiday season. But as part of all of the fanfare, Microsoft officially named the device “Kinect”.
Now, “Kinect” is actually a good name for the product, and the device has the potential to be incredibly successful, but that’s not the point of this blog post. Rather, I’d like to muse about the strategy to use one name for the many months leading up to the actual launch, and then change the name just before the launch. Microsoft has always done that with its operating systems. For example, Windows Server 2008 was referred to as “Codename Longhorn” from early 2005 through August, 2007, when Bill Gates announced its official name in anticipation of its February, 2008 release.
Although that might be fine with operating systems, especially those designed for the corporate server market, Project Natal – er, uh, Kinect – is different. It is a consumer product, not a corporate one. And 2010 is not 2005. When Microsoft announced Project Natal in 2009, it released a video showcasing its capabilities. That video has been on the Top 10 viral video charts every month since then. It has received millions of views, and virtually every gamer has heard about it. Moreover, forums and social media sites have been abuzz over it non-stop.
In other words, social media is the name of the game in 2009/2010, for those companies who know how to use it well. Microsoft certainly did use it well this past year, getting the whole gaming world knowing about and discussing their upcoming product. But they didn’t hit a home run because of their naming tactic. Some of that branding value will now disappear because the word “Natal” no longer exists for Microsoft. They absolutely can – and will – spend lots of money to imprint the new name in people’s minds, but a more nimble and cost-conscious company might have come up with the final brand name a year ago. Then they could have gotten their branding done for them without a massive advertising campaign (allowing that money to be used more effectively elsewhere).
Domus is a marketing communications agency specializing in integrating social media, digital, and traditional advertising and PR into effective brand strategies. For more information, please visit us at http://www.domusinc.com.
Chevy, Chevrolet, the Internet, and Stupidity
by Marc on Jun.10, 2010, under Branding, Strategic Consulting
The NY Times reported that yesterday GM sent a letter to its headquarter employees that they should stop saying “Chevy” when communicating with people, instead exclusively using “Chevrolet”.
“We’d ask that whether you’re talking to a dealer, reviewing dealer advertising, or speaking with friends and family, that you communicate our brand as Chevrolet moving forward,” said the memo, which was signed by Alan Batey, vice president for Chevrolet sales and service, and Jim Campbell, the G.M. division’s vice president for marketing.
“When you look at the most recognized brands throughout the world, such as Coke or Apple for instance, one of the things they all focus on is the consistency of their branding,” the memo said. “Why is this consistency so important? The more consistent a brand becomes, the more prominent and recognizable it is with the consumer.”
Every once in a while some piece of news leaks out that just offers so much opportunity for fun. Everyone is talking about how stupid this is. Just as a few examples:
- Do they truly think that Chevy is made or lost as a brand by refusing to use the name that most of the public regularly uses?
- Might the GM executives have considered that the inconsistency of using “Coke” as an example of why they shouldn’t use a brand nickname?
- If they wanted to tell their employees not to use “Chevy”, might they have also considered changing their web sites, TV, and other advertising? All of them still use “Chevy” throughout. (In fact, tonight every TV commercial that I saw referenced “Chevy” exclusively – not a single mention of “Chevrolet”. And the web site presented was chevydealer.com, not chevrolet.com.)
Did Alan Batey and Jim Campbell not think that in today’s internet-based social media world, their ridiculous directive wouldn’t be discussed by everyone around the world? Did they not realize that they would be mocked and that Chevy’s (and GM’s) brand image would be hurt>
Isn’t the internet fun? Too bad not everyone knows yet how to play in it.
Domus is a digital agency and a full service marketing agency that combines expertise in marketing and technology to effectively communicate brand platforms. For more information visit us at http://www.domusinc.com.
BP, Social Media, and Insurance
by Marc on Jun.04, 2010, under Internet Marketing, Strategic Consulting
BP’s oil spill disaster in the Gulf of Mexico might be the first true national calamity to occur during the social media era. As such, exploring what BP has done and has not done, along with the unfolding consequences, offers the rest of us an illustrative case study on how best to act before, during, and after events such as these – even if on much smaller scales.
Here’s one initial observation. Prior to the spill, BP’s overall reputation was generally neutral – relatively evenly split between people who had positive, neutral, and negative opinions about them. However, since the spill opinions are strongly skewed to the negative.
Also, prior to the explosion, BP had very litle presence on major social media sites such as Facebook, Twitter, LinkedIn, etc. They did a lot of advertising (“Beyond Petroleum”), but not much engagement with the public, especially the online public.
So, whatever they have tried to do since then cannot be effective because they have no initial base of fans from which to draw help and support. As a counter example, consider what would happen if some disaster involved a company such as Starbucks. Excluding all discussions of the nature of the disaster itself, Starbucks would at least have a couple of million people with whom it has established an online relationship and who could (and would) join the discussions from an initially positive perspective.
So, one lesson to be learned is that engagement in social media is not just for ongoing brand strength; it’s also an insurance policy against unanticipated problems – even on scales much less than BP’s disaster.
Domus is a creative and digital marketing agency based in Philadelphia. We combine expertise in classic marketing, social media trends, technology, and business acumen to provide effective short- and long-term solutions for our customers’ marketing needs. For more information, please visit us at http://www.domusinc.com.
Let Dying Brands Die
by Marc on May.28, 2010, under Branding, Strategic Consulting
Everything has a natural cycle of life – even major brands. Yesterday the Wall Street Journal reported that Ford Plans to Kill Storied Mercury”. Although as early as 1985 Mercury was still dominant US brand, since then it has increasingly declined. In 1985 Mercury sold over 500,000 vehicles, but by last year that number had dropped to just over 92,000.
For 25 years (and especially over the last 10) the brand has declined. As such it is a good business decision for Ford to cut its losses and move on. After a certain point, there is not much that can be done to revive a dying brand, no different than a dying person.
That doesn’t mean that there is no room in Ford’s line-up for another brand – Volkswagen does very well with multiple brands – but just no longer Mercury. Mercury’s demise began when it no longer stood for anything special, unless you consider replicating a Ford sister car with fancier trim as something special.
As such, hopefully Ford Motor Company has learned the importance of brand management for its future. Good brand management means that you don’t only declare and communicate the position in the consumers’ minds that you intend to hold, but that you consistently and exclusively deliver products and/or services that meet the consumers’ changing ideas of what that position means. Mercury failed to do so.
Moreover, it’s a recognition that sometimes a brand position can be squeezed into non-existence by other brand positions. Ford, Mercury, and Lincoln represented a “ladder of brands” strategy, giving people smaller stepping stones between levels of prestige. But when foreign auto makers started selling higher quality cars with more standard features at lower price points, Ford had to respond by improving its main Ford brand, which squeezed Mercury from the bottom. Similarly as Lincoln offerred cars at lower price points, it squeezed Mercury from the top. That has left no distinguishing position for Mercury.
Domus is a Philadelphia-based advertising and PR firm as well as a digitial and social media marketing agency. For more information, visit us at http://www.domusinc.com.
World Cup of Branding
by Marc on May.21, 2010, under Branding, Strategic Consulting
In less than a month, the most-watched sporting event on the planet will begin, the 2010 World Cup. But an associated competition is now well underway – brand sponsorship and advertising, specifically the rivalry between Adidas and Nike. Adidas is currently the biggest world cup brand, sponsoring major players and fully one-third of the teams going to South Africa. But Nike is not far behind, sponsoring some of the biggest names in the sport as well as their own teams. Worldwide, Adidas sells about $1.8 billion in soccer gear while Nike sells about $1.7 billion.
This week Nike launched their official World Cup campaign with a new three-minute video created by Mexican director Alejandro Inarritu (Babel, 21 Grams). Called “Write the Future”, it features soccer stars like Wayne Rooney, Franck Ribery, Cristiano Ronaldo, Landon Donovan, and Ronaldinho, as well as non-soccer stars such as Kobe Bryant, Roger Federer, and Homer Simpson.
Adidas, on the other hand, won the rights to be the overall World Cup official sponsor, so it will be interesting to see who wins this battle as Adidas counters Nike’s move.
Domus is a marketing and digital advertising agency based in Philadelphia. For more information, visit us at http://www.domusinc.com.
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