munnen22

[munnen22]

Glow & Lovely?

In the summer of 2020, as Black Lives Matter protests were waged across the United States, Unilever decided to make a statement by changing the name of a brand that was used on the other side of the world- Fair and Lovely would now be known as Glow and Lovely, a name which is not even grammatically correct. There is a lot to unpack here.  The timing of the change seems as if Unilever is trying to make an antiracist statement in response to BLM in Western countries, although protests had been waged over Fair & Lovely’s colourist associations for years in India by groups such as Women of Worth (WOW).  Many were disappointed by Unilever’s actions because the product itself did not change, and was clearly still seen as a skin lightening agent.  However, demand for skin lightening agents in India remains strong, as the case highlights.

To what extent are brands responsible for the ethical implications of their products?  It is obvious how big of an impact major brands can have on self-esteem, especially for girls and young women who feel a lot of pressure to appear attractive. Brands must reconcile this power with the associated responsibility.  Profiting from the self esteem issues of a group of people is not meeting a market need - it is unethical. Many modern brands are trying to gain market share by emphasizing their superior ethics, and claim to want to enact positive social change.  Dove, also owned by Unilever, has run a successful “Real Beauty” campaign highlighting various body types instead of only portraying size 0 models.  Always ran a successful “Like a girl” campaign to try and change the negative stigma of the phrase.  Such campaigns show it is possible for brands to use their influence for societal good rather than preying on societal flaws.   

https://www.thecut.com/2020/09/blm-movement-prompted-a-reckoning-in-indias-beauty-industry.html

[munnen22]

5 Factors, 4 Products

Peanut Butter Slices

Relative Advantage: Saves time of spreading peanut butter and cleaning utensils, which may or may not be considered a significant enough advantage by consumers and indicates unclear adoption rate

Compatibility: Very compatible with typical sandwich making and snacking, indicating quicker adoption 

Complexity: Very simple and straightforward to use and consume, indicating quicker adoption

Trialability: Easy to experiment with product due to low cost, indicating quicker adoption

Observability: Not too observable, except perhaps as used in children’s lunches

Using Rogers’ Five Factors, Peanut Butter Slices rank strongly in 3/5 factors, but relative advantage, arguably the most important but certainly the most fundamental of the factors is not clear, which can explain the lack of adoption of PB Slices.

Collapsible Wheel

Relative Advantage: Saves space for bike commuters, which will be a significant advantage for some commuters but a nonexistent advantage for others

Compatibility: Not compatible with current bike makers: “I’m getting an incredibly enthusiastic response from everyone except the bike industry”

Complexity: The product is difficult to produce, and it is unclear how easy to use it is

Trialability: Extremely low due to high price tag

Observability: Probably quite observable given the distinctive design

The collapsible wheel ranks decently well on relative advantage and observability, but the poor ratings in the other three factors are not promising for adoption.

Stave Jig-Saw

Relative Advantage: Beautiful and uniquely challenging puzzle 

Compatibility: Very compatible with puzzle fans

Complexity:  Easy to implement for an advanced puzzler

Trialability: High for those of a high income because you only commit to one puzzle at a time, but low for those with lower income due to high price tag

Observability: High, as the bar scenario in the opening of the case describes

The stave jig-saw ranks quite highly on all five factors and this has been reflected in the success of the company.

Polytrack

Relative Advantage: Safety and survival of the horses, at the expense of record breaking times

Compatibility: Compatible with tracks but not with the record system due to lower times 

Complexity: Low

Trialability: Relatively low because of the upfront expense

Observability: Relatively low because of the similar coloring to traditional turf

The poly track has a very significant advantage in safety, but the tradeoff in race times and the low ratings in the other factors seem insurmountable for the racing industry.

[munnen22]

Concha y Toro

A few months ago, a friend invited some ladies over for wine and an accompanying charcuterie board.  While I don't personally drink, the guests were all raving about the wine and admiring the bottle she had used to serve us which had a beautiful but unfamiliar “Sea Glass” label.  She admitted to have chosen it because of the pretty label, but that it was the cheapest bottle on the shelf of the liquor store she had shopped at.  While none of her guests were wine connoisseurs by any means, everyone had tasted a range of wine before and were shocked such an affordable wine was so delicious.  This experience definitely suggested to me that wine consumption was much more about perception than actual quality.

Today’s case on “Concha y Toro” describes the challenges of Chilean wine in overcoming dropping operating profits and margins.  Unlike other alcoholic beverages, the wine industry is fragmented and lacks strong brand loyalty, so firms tend to focus much more on the product than advertisement.  In particular, “Brand loyalty could play a role in the large popular segment, where consumers lacked knowledge and were risk averse, but in the premium segment, consumers wanted more choice and tended to seek out novelty” (5).  Despite proven quality in recent years, Chilean wine had developed a reputation  as “cheap wine” in certain markets that was difficult to shake.  Because of this lingering reputation and the more limited audience of the premium segment, Rafael’s option 1 of gradually leaving the lower end of the price spectrum would likely be ineffective.  

Choosing option 2 with the top-down strategy “whereby the firm would exploit the prestige of its high-end wines to expand into the basic segment” seems promising because it takes advantage of both the recent attention garnered by its high-quality wines as well as tapping into the existing reputation as an affordable wine (8).  As noted by the case, higher volumes can offset the lower margins and “provide the means to integrate downstream towards distribution in key markets” (8).  Given the importance of distribution networks in wine sales, I would suggest option 2.  

[munnen22]

Life Cereal and Market Research

Using Quaker Oat’s Life Cereal brand as an example case, it is clear how the various forms of market research are important both independently and in conjunction.  Life was created out of an opportunity identified from motivation research and was introduced with test market experiments to assess how consumers and the trade would respond if Life was placed in the market with various different forms.  The shredded biscuit form yielded the “highest repeat purchase rate and overall share.” Following product launch in the shredded biscuit form,  Life’s various advertising agencies focused largely on non-experimental/qualitative research including surveys and focus groups. 

While Life attempted various family-oriented advertisement campaigns such as the growing theme, it was revealed through a company attitudinal study that Ready-to-Eat (RTE) cereals were seen as “more tasty but less nutritious than hot cereals” (2).  Secondary data, while not prioritized by Life’s advertising teams, also turned out to be a particularly useful resource as it revealed only 13% of buyers say the reason they buy a particular cereal is nutrition.  Industry sources also revealed that Special K had a significantly higher advertising budget than Life was proposing in the case.  Given these insights, increasing attention and budget to advertising as well as focusing on the tastiness of the cereal would appear to be an important direction for the company.  Aired in 1972, an iconic commercial that became known as “Mikey Likes It!” was launched.  It was instantly popular and aired for nearly a decade, and a remake was even done in the early 2000′s.  The commercial focused on the good taste of the cereal that even the pickiest of kids would like and was presented in a very relatable scene.  Market research had indicated shifting away from a nutrition focus and towards a taste focus could be fruitful, and indeed this prediction was realized in the case of Life cereal.  

Here is a great summary video showing the history of Life and clips of the commercials mentioned: https://www.youtube.com/watch?v=j-8IKP86EAI

https://www.mashed.com/218962/the-untold-truth-of-life-cereal/

[munnen22]

Black & Decker

The Black & Decker (B&D) case is a great example of tradeoffs.  While the Consumer Tools sector of Black & Decker brand was thriving with a high brand-strength, the B&D reputation as a consumer tool provider was detrimental to the smaller Professional-Tradesmen Tools segment.  Interestingly, the Professional-Industrial Tools segment was also strong, indicating that product quality is not the reason for the lesser reputation among tradesmen.  Since most tools in the Professional-Industrial segment were purchased by companies rather than individuals, quality was of the upmost concern.  Most customers in the Professional-Tradesmen segment would buy their own tools to be used for their jobs, including electricians, plumbers, carpenters, etc.  This is relevant to the issue at hand because B&D needs to market their tradesmen tools to individual consumers, while maintaining a reputation for industrial-level quality within this segment.  

It seems that B&D has been largely treating their Professional-Tradesmen segment similar to the the Consumer Tools segment, which has clearly not been paying off.  Given the 9% growth in this segment, higher than either of the other two, it is worth it to reconsider this approach.  Of the three options presented (Harvest Professional-Tradesmen Channels, Get Behind the Black & Decker Name with Sub-branding, and Drop the Black & Decker Name entirely from this segment), I would suggest Option 2 is the strongest.  Sub-Branding has already shown success with the Spacemaker line and the “Piranha” subbrand. Dropping the B&D name entirely would be risky, as B&D at least has very high brand awareness (98%) despite low “One of the Best” agreement.  Sub-branding could be the perfect compromise between high brand awareness and separation from the consumer line, allowing for the product’s quality and reliability to shine.  Changing the color could also be an important aspect of this plan, to avoid the stigma of “those B&D gray things.”