Marketers love assigning names to explain segments of the population. For instance, back in the 1970s marketing research firm Claritas (now part of Nielsen) introduced a naming system for identifying lifestyle segments. Called PRIZM, their method created segments using demographic data (e.g., income, age, geographic location, ethnicity, etc.) which was then matched with certain behavioral information (e.g., activities, purchase behavior, political leaning, etc.).
One reason marketers like assigning names to segments is that it makes it very easy to explain their primary target market when talking to non-marketers, including those in their own company. Instead of saying their target market consists of wealthy, suburban living customers between the age of 45 and 64 who are college educated and have children at home, it is much easier to assign a label to this segment by saying their market are the Blue Bloods.
While the approach used by PRIZM and other segmentation models takes into account several variables, another way of classifying groups is more simplistic and considers only a few segmentation dimensions. One of the most popular is based on generational data, specifically on when someone was born. Examples are fairly well known and include Baby Boomers (those born between the mid-1940s and the mid-1960s), Generation X (born between the mid-1960s and the mid-1980s) and Millennials (born between the mid-1980s and early 2000s). These groups are labeled as generational as these are often viewed as being born during the time when the previous generational group has children.
However, it is important to note that creating these demographic categories and names is not set in stone. In fact, the labels and time span become accepted only because these are picked up by mainstream media based on work from a popular writer/researcher who coined the term. So it is with some reservation that we discuss what may be the newest generational label: Generation Z. The Gen Z group represents consumers born after the mid-1990s. According to this story in Shopper Marketing, this group possesses certain traits that set them apart from previous generations with the most notable being that they are the first generation to have always been exposed to the Internet. The impact this group may have on consumer purchasing is discussed in the story.
Over time, it remains to be seen what label is eventually bestowed on this population cohort. What will also be interesting is what name is given to the generation that follows Gen Z since we have reached the end of the generation-naming alphabet.
When marketers chit-chat with non-marketers, the discussion often will touch on what marketers do as part of their regular responsibilities. In most conversations, the marketer will explain they do the activities usually associated with marketing such as advertising, doing research, talking with customers, etc. What is often not included in this discussion is the role marketers play when an organization faces a crisis environment. By "crisis" we are referring to a potentially critical situation that could result in a significant financial and, in some cases, legal predicament for the company. Some examples of situations that may lead to a crisis include: a health or injury issue resulting from using a product sold by the company; a scandal that leads to public mistrust of the organization's top managers; or a violation of governmental rules leading the company to be blamed for causing environmental damage.
In some cases, the public has clearly decided the name of the product or company that is frequently mentioned in news reports is to blame to the point that when the public is exposed to this name they instantly associate this with the damage that was caused. When this happens for an extended period, the company's marketers turn to crisis management marketing. In many cases, their work will eventually bring the brand back to being accepted. However, in other cases, where the damage is beyond repair, marketers may recommend only two options to the top decision makers: 1) get out of business or 2) stay in business but change the product or company name.
For instance, the diet product Ayds enjoyed strong sales in the 1970s and early 1980s until the AIDS disease was discovered. The similar sounding names created significant market confusion that eventually led to the product being withdrawn. Another example is Philip Morris, which changed the overall company name to the Altria Group after facing a long period of negative publicity for it tobacco products. While the company retained the Philip Morris name for its tobacco product line, other company product lines are no longer directly associated with Philip Morris.
We now see another company experiencing a crisis that may lead to a name change. As discussed in this CBS News story, Malaysian Airlines, faced with two dramatic events in the space of a few months, may be looking to rebrand. The airline believes a name change is needed if it wants to move beyond the recent accidents.
It is important to understand that changing a brand name can be quite expensive. Not only because of the new graphics and product labels that are required but also the amount of time and money needed to re-establish a relationship with customers. Additionally, whatever brand equity that still exists with the original name will be lost. So companies will only go this route if they view it as the last chance to remain in business.
Adjusting to market changes is one of the most challenging tasks facing marketers. In particular, deciding whether customers are truly adopting a new trend for the long haul or just experimenting with a temporary fad can make for long meetings among company personnel. Why? Because depending on the trend the change may be so significant a company, and possibly an industry, may not survive.
For instance, in the early 1900s, buggy whip marketers disappeared when automobiles became the principle method of transportation. More recently, video rental retailers, that first offered VHS tape products and DVDs, were pushed out by cable television and online video. And, of course, there are many, many other examples.
So it is with great interest that we see what could be another product category destined for retirement. According to this Advertising Age story, the traditional businessperson briefcase may be on the way out. Its replacement could be the backpack or some form of over-the-shoulder carrier. The reason for this appears to lay with consumers' need to access mobile devices as they are walking or otherwise traveling. That is, most people cannot easily carry a briefcase while also texting, talking on their mobile phone or web surfing.
This trend must be causing deep concern among briefcase marketers. They must be struggling to decide whether to continue to spend on marketing traditional briefcases or shift their focus to over-the-shoulder models. The stakes in making the right decision and doing it in a timely manner may be the difference between staying in business or looking for a new job.
After a short vacation, the KnowThis.com Marketing Blog is back with a somewhat different posting. Normally our postings are comments on marketing stories found on leading media sites, however, today our post is based on observation of a current television advertisement running on U.S. networks. The ad is from leading pet retailer Petco for a product offered by Purina, one of the world largest pet food suppliers (see the YouTube video).
This ad is interesting in that the message some viewers receive may be interpreted in ways the advertiser does not intend. Specifically, the visuals in this advertisement focus only on dogs. While the voiceover and on-screen text suggests Purina provides products for dogs and cats, many people watching the ad will likely presume this is an ad only for dog products.
However, what may really affect viewers' perception of the ad is the final few sentences, which talks about how dogs will love the product. It then states Purina's product: "Helps bring out the best in our greatest companions." Now it is very possible the take-away that some people may have is that the ad is about dog food and, yes, dogs are our greatest companions. But for other animal owners, including owners of cats and birds and probably a few other pets, the presumption that dogs are the "greatest companions" may not sit very well.
While it is quite likely the "greatest companions" line was intended to cover all pets that serve this role, the execution of this ad could make that a hard sell for pet owners who do not agree with this statement.
It is not often a once illegal industry suddenly shifts to being a legal one. Certainly in the U.S. the end of prohibition back in the 1930s is a good example, and so is the more recent legalization of gambling by many U.S. states. As with any industry, a newly legalized one will draw competitors who are looking to earn their share of the emerging market. This, of course, means marketing decisions become a key factor in whether a company will be successful. And at the top of the list of what marketers and their companies must do is to develop new products that will provide advantages over competitive offerings.
As we discuss in our Product Decisions tutorial, a key part of the product development process is the need to identify a brand name that will help distinguish a product from those offered by competitors. Obviously for the alcohol industry this can be seen with the thousands of branded beers, wines and spirits. The gambling industry also has branded products including branded slot machines and table games.
So it is no surprise that product development is now news in the nascent legal marijuana industry. As discussed in this Los Angeles Times story, companies selling medical marijuana in California not only deal with product design issues (i.e., new strains of pot) but also face branding decisions. And while to some readers this may sound pretty amusing, one company profiled in this story indicates that brand names are created through brainstorming sessions. While this story focuses on the marijuana business in California, there are many other states where medical marijuana is dispensed as well as two states, Colorado and Washington State where retail sales are permitted.
On the downside, marketers in this industry face legal issues when it comes to protecting their brand names. The U.S. Patent and Trademark Office (USPTO) will not grant trademarks on brand names, at least not for newly developed marijuana strains. However, some state governments appear to be more open to offering trademark protection for products sold in their state, including marijuana. With the pace at which states are now permitting the selling of pot, it would not be surprising to see the USPTO loosen their restriction over the next year or so.