Saturday, January 31, 2009

dey gru ^ txtN -- w@ wl biznessz nd 2 do?

Translation: "they grew up texting -- what will businesses need to do?"

Cross-posted @ Generational Impact blog

Sunday, January 11, 2009

Every store can't be Walmart

Every business cannot offer the lowest prices... so what else can be done to increase the chances that customers will buy?

Two January 2009 shopping trips, two very different scenes.

Trip #1 to a local mall on a Saturday afternoon. Few shoppers. Even fewer buyers -- it was startling how few people were carrying shopping bags with purchases.

Trip #2 to a local Walmart on a Saturday afternoon. Hard to find an empty parking spot (picture just below). The store was packed with shoppers. 35 of 38 cash registers were open and all had lines.

Fact: In the current economic climate, shoppers are attracted to low prices.

Fact: Not all stores can compete price-wise with the Walmarts of the world.

Beyond low prices, what are businesses doing to increase customer purchases?

Note: While not new tactics, the following are examples of methods some firms are employing in attempt to keep customers buying.

  1. Bundle current products together for a "deal". Recently, Jack In The Box announced the new "Jumbo Deal" (picture below) that combined a sandwich, tacos and fries for $2.99. Even if the price covers only costs, the fast food restaurant can profit from the likely sale of a highly profitable soft drink.

  2. Reduce purchase risk by offering attractive warranties and guarantees. Already tightening their purse strings and wallets, even willing consumers are looking for methods to minimize risks of unwise spending on products. Businesses can increase consumer confidence in purchases by offering strong (as perceived by the buyers) product warranties and guarantees (money back if not satisfied, you will not find at a lower price, etc.).

  3. Allow consumers to try the product before purchasing. More businesses are finding ways to allow customers to "test drive" their products. Starbucks is offering free trials of two new Tazo tea drinks (with a coupon from a USA Today advertising insert -- picture below). This allows customers to be more sure that they like the product before purchase thereby increasing their buying confidence to overcome risks of spending money that is in short supply.

Thursday, January 1, 2009

The "surprising" state of brand perception at General Motors

GM's recent television spots seem to be an admission of what the company knows too many consumers think about their vehicles

During the holiday season of 2008, General Motors ran a series of television advertisements for a "Red Tag" sales event (that would run through early January 2009). As would be expected, these spots were visually appealing and conveyed various logical GM branding points to consumers --such as vehicle safety, high resale value, good fuel mileage, and appealing / attractive vehicle makes and models.

However, upon deeper examination, it was not these points that were most revealing. Rather it was a tag line and story line that gave a glimpse into what General Motors understands how their products are perceived by the car buying public.

Example 1: "Made by GM... Surprised?"
One set of commercials for multiple GM makes and models highlighted product value points -- safety awards, resale value, fuel mileage -- of the featured vehicles. It is worth noting that after listing such a good vehicle attribute comes the tag line of "Made by GM... Surprised?".

These four words reveal what GM knows about the state of their brand. Should consumers be surprised that GM can make a quality vehicle? Apparently GM thinks so.

Here are three of the spots.

Example 2: Customer at Saturn dealership can't believe his eyes

Another television spot shows a customer walking into a Saturn showroom, then upon seeing attractive vehicles there, looks back outside at the street sign to make sure he was at a Saturn dealer. He is surprised to learn that Saturn has attractive vehicles. From the comments of the salespeople, many others share his surprise.

This glimpse into what GM understands -- that consumers perceive Saturn product offerings as non-appealing design-wise and that consumers will be surprised that Saturn can build attractive vehicles.

It is amazing to think that good vehicles from General Motors should be surprising to American consumers.