BrandWatch by Michel Gutsatz

Distributors Take Over – The Case of Nutrition

On 26 June 2008, I drew your attention to the "Guiding Stars" programme by Hannaford Brothers, which was the first case where a distributor - in the name of the responsibility it has towards its consumers - displayed the nutritional quality of all products available in the store (including national brands). I concluded my post by saying, "The distribution plays a role here: provide information and transparency on ALL products to a consumer in search of clues. It is the consumer who will win in this debate on nutrition". This initiative has been followed by other retailers:

• United Supermarkets (and Market Street) in January launched its "Tag Labelling" system (created by its own dieticians) that, by means of shelf placards, show the presence of products that are Organic (O), have low sugar content (S), are gluten-free (GF), low fat (L), good for the heart (HH) or good in case of a diabetic diet (DM).
  
  
  
  
• Supervalu (followed by Albertson's and the 1300 stores of the 3rd largest U.S. network) has initiated a new system of nutrition information, "Nutrition IQ", developed with the help of Joslin Clinic, a university medical centre affiliated with Harvard Medical School. To qualify for the iQ label, the product must have reduced levels of salt, sugars and saturated fats. Only around 14% of the 30,000 products already evaluated carry the label:  their essential nutritional benefits will be indicated on the price label. "Excellent or good source of fibre" is denoted by orange tags, "excellent or good source of calcium" by blue tags, "excellent or good source of protein" by yellow tags, "low or healthier level of sodium" by dark-green tags, "low-calorie" by a purple tag, "low saturated fat" by a red tag and "whole grains" by a dark-orange tag. " However some categories remain on the sidelines of this nutritional assessment ...
  
  

The movement is therefore irreversible: all U.S. distributors, taking advantage of the national debate on obesity and the nutritional qualities of products, create evaluation grids and apply them to most of the products they have on the shelves. Here is a great way of putting pressure on national brands ... When will such a system be implemented in Europe?

Luxury and the Crisis: the Case of Vertu

What was my surprise to see that a Vertu sale in the VPLounge of vente-privee.com was planned on Wednesday 24 June! I registered, of course, intrigued by both the prices that would be charged and the proposed models.

• The prices offered were set at 40% of the usual price – i.e., a discount of 60%. The Vertu Constellation range could be found at 1640 euros instead of 4200 euros, and the Vertu Ascent range at 2280 euros instead of 5700 euros.
• The models that were offered - Signature Diamant / Constellation / Ascent - were models of the current collection, available at the Vertu retail outlets. I noted, in particular, that the models of the new Signature range, launched in September 2008 in Paris, were also available. To be quite clear, I went to re-verify it on the website of the brand: the telephones that I saw sold at a discount of 60% were indeed there.

 

 

 

All brand marketers I have discussed vente-privee.com were unanimous: all products offered were sold out within a few hours; these were (almost) always unsold stocks of the previous season. Vertu therefore did not follow the golden rule of private sales: do not offer discount prices on products available at retail outlets. Unless, of course, the economic situation of the brand is bad and it is necessary to un-stock ... but at what cost to its customers?    

American Retailers Love the iPhone

Several American distributors have realized that they could use the iPhone as a channel to communicate with their customers.
Whole Foods Market has launched an application for the iPhone and the iPod Touch, offering all its 2000 recipes: You can sort them by ingredients, type of diet (gluten free, vegetarian, low fat), you can choose "low price" or "family" recipes, and so on. Each recipe comes with all the tips to make it successfully and provides nutritional information. You can also type in an ingredient in the application, and recipes will be suggested accordingly.
Meijer offers two iPhone applications:
MealBox offers a range of recipes and can generate a shopping-list based on the recipes chosen. 
WineList is a tool to discover wines, their origins, their prices, special offers, and their association with foods.
The main difference is that Whole Foods offers a free application, while the Meijer application costs $ 1.99!  As usual, Whole Foods shows that it is close to consumer expectations: they have understood that, today, consumers want their relationship with their retailers to be more than JUST commercial. Offering what is non-commercial, and therefore free, can only strengthen the link between the store and its customers.

What Struck Me Most in Shanghai

Several people have asked me what struck me most during my recent trip to Shanghai. The answer is undoubtedly: speed.

An object that symbolizes it to me: In every lift is a "close doors" button that is systematically pressed by the last person to enter. I do not remember seeing this button in ALL French lifts…

Is Green the New Black?

During her inaugural address at the IHT conference on luxury held in New Delhi last March, Suzy Menkes said: "It was the designer Tom Ford, the founding father of the 'it' bag used for just one season who inspired me to make this conference about 'sustainable luxury'. He gave a keynote speech at the IHT's Moscow conference on "Supreme Luxury', saying that he was already uncomfortable with that concept. And that maybe in the future, a discreet tab announcing a 'green' product would speak louder to the consumer than a branded logo". 
At the same time PPR decided to sponsor the making of "Home" by Yann Arthus-Bertrand, this magnificent film which has the merit of exposing facts that affect us all in a manner that is both educational and aesthetic: all the luxury brands of the group (which appear in the credits) thus publicly undertake to reflect on the dangers threatening our planet.
Does this mean it that luxury brands have engaged in substantive work on their "Corporate Social Responsibility" - this encompassing the environmental consequences of their actions? If the report "Deeper Luxury" published in November 2007 by WWF UK is to be believed, this is far from the case. In the classification of ten groups and luxury brands according to criteria that will respect diversity up to environmental impact, none of them received a ranking higher than C + (on a scale of A to F)!

Today, consumers - and the economic crisis will only reinforce this fundamental tendency – are proving to be bearers of an ethical vision of the world: in the constant struggle which they face within themselves between pleasure and reason, the ethical dimension of reason prevails. This choice is supported by an international elite, avid consumers of luxury goods, and now by the middle classes from mature markets - those that have created the success of luxury brands for over 20 years. The products of luxury brands are standard products, but the criteria of what gives status are changing. New markers of status as well as new markers of success are emerging. One of these is an assertion of an environmental and ethical conscience.
Luxury brands will therefore have to quickly adhere to this new worldview - which is sweeping even emerging countries on which they are building for their future development.
I think it is essential that they incorporate "sustainability" and responsibility in their values and to use the terms of the WWF report: "Luxury brands have the power to influence consumer behavior by aspiration and editing consumer choices through product design, distribution and marketing; and by influencing how, when and for how long consumers use their products. They have both the opportunity and the responsibility to promote sustainable consumption".

"The Lady Noire Affair": When Dior Tells Us Stories

On 20th May, Dior launched online the film "The Lady Noire Affair" for which the brand has been keeping up a buzz on the Internet for several months. It concerns the first in a series of 4 movies of around 6 minutes, created exclusively for the Web, made by reputed directors and which will be broadcasted by the end of 2010 … the whole forming a film noir in the manner of the 50s … strongly inspired by Alfred Hitchcock.
The timing of this operation is worth noting:

• It all started in November 2008 with a "print" campaign by Peter Lindbergh featuring Marion Cotillard at the top of the Eiffel Tower - at first glance we think that this is just a "typical" campaign where Dior's current muse presents the Lady Dior bag.
• A teaser campaign on the Internet started on 24th April with the opening of the site dedicated to this purpose, www.ladydior.com
• A widget showing 8 seconds of the film, asking, "What's in her bag?" "What is she looking at?"  was distributed to selected bloggers by the brand.
  
  
• A Lady Dior thread is launched on Twitter: each day a twit helps to keeps up the suspense and progressively add more goodies. One consequently finds exclusive scenes from the film, questions that guide web surfers through this film noir, information on the connection that exists between Christian Dior and Alfred Hitchcock, etc.
  
  
• A contest, allowing people to discover clues on partner sites.
• An e-mail campaign sent to Dior clients in Europe.
• Distribution of the trailer through the Net and blog sites
• Avant première projection of the film to journalists and bloggers
• The launching of the film May 20, which will be available on the Web and iPhone

The results are impressive and show how successful this advertising has been:

• The widget can be found on more than 1200 sites;
• There are 1300 "followers" of the Twitter thread;
• The film was referenced on 1 million sites;
• The Lady Dior site has been viewed 2 million times since its launch; and
• ... Worldwide Dior sites saw in a month as many visits as they usually see in 6 months.

In keeping with the lines of the previous BMW's "The Hire" that I spoke of last week, this is exemplary for more than one reason:

• This is a brand communication - consistent with the brand and its roots: the 50s, the cinema, Christian Dior as film costume maker ...;
• It is constructed like a narrative where the brand tells a story;
• Its distribution uses the real levers of modern communication: the Web and social networks;
• It also relies on a multiplicity of channels, each playing an important and different role: the "print" / the Web 2.0 / e-mails, etc.
• Finally, it is not a launch of a product: the Lady Dior bag exists since 1995 and this campaign is perceived primarily as one to feature the brand ... Of course sales of the Lady Dior will benefit greatly!

As a bonus, of course, here is the film:

When Brands Take Consumers for Fools

On May 15th the New York Times published an article entitled "Angry Ads Seek to Channel Consumer Outrage". The journalist draws attention to a series of recent advertising campaigns where several brands - in very different fields - use a common approach to address their customers.  Aware that they are outraged by the lure of profit of business leaders and financiers who led the global economy into recession, these brands adopt a totally unconventional tone by denouncing the excesses in question and present themselves as "clean".

A Miller beer deliveryman refuses to supply bars and other retailers who cheat their clients. 

Kodak is up in arms against ink cartridges at prohibitive prices. 

Harley-Davidson slams the Wall Street "casino": "Screw it. Let's Ride!" 

Post Shredded Wheat invents a CEO who denounces unnecessary innovations in food: "When it comes to food, progress has pushed molecules ahead of meals, hormones over home-grown, and our cattle have become clones". 

In all these campaigns, the only one truly consistent with brand values is that of Harley Davidson: even if its current clients are mostly successful doctors who wish to offer themselves a few thrills on weekends like the Hell's Angels, the brand itself is synonymous with rebellion. The remarks from the readers of the New York Times article speak for themselves: in splendid unison they denounce an avatar of advertising which treats consumers like idiots.
"Human values are reduced to empty shells, used by marketers to elicit emotions associated with brands, and replaced by the god-almighty corporate bottom line".
"Gentlemen, I give you the Perpetual Greed Machine, PERFECTED"
I am not far removed from sharing their anger: A message must be consistent with the brand values, otherwise it is immediately perceived by consumers for what it is - opportunistic and artificial.

Do you remember "The Hire", BMW's Internet campaign?

Traditionally, BMW produces a major advertising campaign to launch a new model. In 2001, as no new vehicle was anticipated, BMW North America (with its agency, Fallon) decided to launch a campaign exclusively designed to strengthen brand awareness and strengthen BMW's image "delivering the world's most exciting luxury cars ". 
BMW's marketing team proceeded from the fact that the average age of its clients was 46 years, they earned an average of $15,000 per year and that 85% (in 2000/2001!) of them made use of the Internet before choosing a new vehicle. So they decided to create a series of short films around a recurring hero (played by Clive Owen), "the driver", made by well-known directors ("Ambush", by John Frankenheimer / "Chosen", by Ang Lee / "The Follow", by Wong Kar-wai / "Star", by Guy Ritchie / "Powder Keg", by Alejandro Inarritu / "Hostage", by John Woo / "Ticker", by Joe Carnahan / "Beat the Devil", by Tony Scott)... and broadcasted on the Internet during two seasons.

Announced by TV spots presented like "movie trailers", by a printout campaign and an Internet campaign, these films could be viewed once the user had registered on the BMW Films site. They could also download the BMW Film Player - giving detailed information on the cars used in the films as well as bonuses, etc.
The results were fascinating:

• The films were viewed 11 million times in the first 4 months,
• 2 million Internet users registered on the site,
• 60% of them wanted to receive more information by mail,
• 94% among them recommended the films to other surfers,
• ... and the sales of BMW rose by 12.5% in 2001.

This campaign was a real innovation from every point of view:

• The use of the Internet as a medium of communication with films designed for that purpose by deflecting the TV series model (when ADSL was still rare);
• The choice of famous directors and stars - and therefore a high quality production ... consistent with brand values.
• The desire not being to sell a product but to build the brand image: the sales are but a consequence - but they are not the end purpose of the film (in contrast to conventional advertising campaigns)
• It is therefore extraordinary risk-taking on the part of a luxury brand … that proved to be successful.

We had to wait 8 years to see another luxury brand tread the same path: I will talk next week of the new Dior campaign, "Lady Black", which draws heavily from this BMW example.
I do not want to leave you craving for more, so here are some of the films. If you so wish, I will post the others later. Enjoy!