The Marketing Threat Posed by Sports Scandals

What a memorable week it has been in the sports world. Too bad none of the memories have occurred on the field of play. The showdown on Capitol Hill between Roger Clemens and Brian McNamee cast baseball in an unfavorable light yet again. NFL Commissioner Roger Goodell met with U.S. senator Arlen Specter about the New England Patriots “spygate” situation. Indiana University men’s basketball coach Kelvin Sampson faces more allegations of improper recruiting activities. Some people wonder what the big deal is in all of these cases. After all, cheating has probably been going on as long as the concept of competition has existed!

The common thread in this week’s sports headlines is that unethical behavior poses a threat to the integrity of the brands involved. Companies in virtually all industries profess to place a premium on ethical conduct in their dealings with customers, suppliers, and other stakeholders. If businesses breach the trust of a stakeholder group, they suffer financial consequences (e.g., lost sales, employee turnover) or even legal consequences such as fines or other sanctions. The sports industry must realize that it can suffer the same consequences if unethical behavior is not brought under control.

Let’s face it- the NFL, MLB, NCAA, and their member franchises or institutions are all brands. If the reputation of a brand is eroded and its credibility is called into question, it loses its power in the marketplace. Sports brands hold a special place in our society because of the passionate relationships so many people have with their favorite sports and teams. But, those relationships could be negatively impacted if steps are not taken to curb unacceptable behavior. Sports consumption is not a necessity, and if sport properties want to remain relevant they must make it a priority to operate with the utmost integrity.

The Changing Role of Packaging

Product packaging has evolved in its role in marketing strategy. For many years, packaging received little, if any consideration as part of the product. It merely provided a storage function. Then, when marketers understood that brand associations related to packaging are held by consumers. Thus, packaging became part of brand building efforts, with notable examples being Coke’s contour bottle and Apple’s all-in-one iMac.

Today, packaging takes on an even more prominent role and can actually be a point of differentiation. Packaging can enable product use in different situations (e.g., Yoplait’s Go-GURT), product easier to use (e.g., Heinz ketchup in bottles designed for refrigerator doors), or shape a brand image that can command a price premium (Apple iPod and iPhone). In the future, product packaging will take on greater significance for what it does not do… waste natural resources. Concern about protecting the environment has spurred a call for coming up with ways to reduce the amount of materials used in product packaging. Wal-Mart has a Packaging Scorecard initiative that assesses its suppliers efforts to reduce packaging waste.

Focusing on packaging can not result in a successful marketing outcome, it is the socially responsible thing to do!

Can Restaurants Curb Regulators’ Urge to Count Calories?

A recent article in Business Week covered a movement that seeks to force restaurants to prominently post calorie counts on their menu items. Health advocacy groups want the restaurant industry to provide customers with easily accessible nutrition information in order that they can make more informed menu choices. Opponents to this push see these groups as the “food police” and believe it is an infringement on free choice.

This situation is very delicate for the restaurant marketers. Self-regulation is almost always preferred over government regulation. The industry has taken steps to respond to Americans’ expanding waistline such as healthier menu items and smaller portions. However, for many people critical of the restaurant industry these tactics are token moves that do not address public health concerns adequately.

Also, this issue seems ripe for government intervention as elected officials could take on this issue with little political risk. For a politican, saying “I believe restaurants should clearly post calorie information on their menus” is about as risky as saying “I think the telemarketing industry should allow people to sign up for a ‘Do Not Call’ list.” This scrutiny of restaurants is not surprising; I see this as another step in legal and regulatory forces intent on making food marketers their next tobacco industry. Link

The Heart of the Matter: Honest Representation in Advertising

Celebrity endorser advertising is a very effective means of impacting an audience. The liking people have for an entertainer or athlete can influence liking of the brand a celebrity endorses. Likewise, a well known authority or expert can be persuasive by giving his or her support to a brand. At first glance the connection between Dr. Robert Jarvik, who developed the artificial heart some 25 years ago, and Pfizer’s Lipitor heart drug seems to be an excellent match for a celebrity endorser campaign. Jarvik is obviously an expert on heart health and speaks passionately about his desire to make a difference in this area.

So, why are there concerns about Jarvik’s role as a Lipitor spokesperson? It has been noted that Jarvik does not accurately portray his lifestyle in the current Lipitor commercial. He is seen rowing a one-man shell across a lake… except it is not him, but a stunt double. The image he portrays in the ad does not match his actual pursuits. For all of the expertise Jarvik possesses, why is it necessary to attempt to dupe the audience in this way?
Pharmaceutical marketers have been in the cross-hairs of regulators and advocacy groups, and this tactic does nothing to build trust in direct-to-consumer pharmaceutical advertising. It is one thing for an endorser to associate with a beer brand that he does not really drink (although it is bad practice), but it is quite another matter when deception on any level occurs in an ad for a product with major health consequences for its users. If pharma marketers continue to push the envelope on their advertising claims and images, opposition may begin to push back and jeopardize the future of DTC advertising. Link

Just Say "No" to Obese Customers?

I am a native Mississippian, so I am accustomed to the state being near the bottom of all states in many categories: education level, income, and other important measuring sticks for a population. Another distinction Mississippi holds is that its people are among the fattest in America. Obesity is a problem in Mississippi and other states, and it is important for leaders in health and education to promote healthier lifestyles.

With all of that said, state lawmakers in Mississippi have done little to overcome negative associations about the state. A bill was introduced recently in the Mississippi House that would prohibit restaurants from serving obese customers. Yes, I said prohibit! One of the bill’s sponsors said his intent was to call attention to the obesity problem and that he did not expect the bill had a chance of becoming law (which it does not). But, the prospect of government telling businesses which customers they can and cannot serve is scary. People should be free to choose whether to enter into a business relationship with a seller of a product or service. Likewise, sellers should have freedom of choice when it comes to their exchange partners (i.e., customers).

While I side with restauranteurs and their clientele with hearty appetites, I also believe that the food industry, whether it be packaged good marketers or restaurants, should take steps to promote responsible consumption. Otherwise, the food industry will be regulators’ and trial lawyers’ next tobacco industry. Link

Super Bowl Commercials: Winners and Losers

The Super Bowl is over and the analysis begins… no, not just why the Patriots were unable to finish with a perfect season. It is also time for the Super Bowl commercials analysis- which commercials scored and which ones flopped.

I have three categories: 1) top three commercials, 2) bottom three commercials, and 3) three commercials most likely to positively impact the brand. Top three/bottom three spots are subjective views on whether the creative message resonated with the audience. The impact category is a judgment on which commercials will lead to outcomes the advertiser desired.

Top three commercials:
1. Budweiser – Dalmation trains Clydesdale a la Rocky Balboa
2. Doritos – Giant snack rat
3. Bud Light – Fire breathing man

Bottom three commercials:
1. Hyundai – Genesis sedan; company wavered on pulling Super Bowl spots… it should have!
2. Sales Genie – Animated ads featuring Indian and Chinese characters were ineffective and borderline culturally insensitive
3. Under Armour – Too little focus on the product, a new shoe line

Top three impact commercials:
1. Tide to Go – A humorous spot that informed people about the product and attempted to drive traffic to a web site.
2. E-Trade – Talking baby effectively gets audience’s attention and could spike traffic for account applications or at least site visits
3. Go Daddy – Danica Patrick’s “Exposed” video will send thousands to the site. If the goal of marketing is to get the audience to take action, this should do it.

To view your favorite (or least favorite) commercial again, visit www.myspace.com/superbowlads.

Super Bowl Advertising Part 3 – See It Now, Buy It Later

This final pre-Super Bowl post deals with a rising trend in Super Bowl advertising. The big game has become a platform for launching products new to market or in some cases not even yet on the market. The large audience delivered by a Super Bowl and the high involvement the audience has with commercials makes it the ideal situation to roll out new products or a new advertising campaign. Movie studios have taken the idea a step further by advertising movies that might not be released for several months.

Why advertise a “product” that cannot be purchased by people once they are exposed to it? For most products, a strategy whereby you essentially say “Here is my product, but you can’t have it… at least not now” would be foolish. Why does it work for movies (if indeed it works)? This teaser strategy creates awareness for upcoming releases. Also, it can begin a buzz about a movie among people. Such word-of-mouth communication is very helpful to stimulate interest in a movie. So, be on the lookout for movie trailers during Sunday’s Super Bowl. But, don’t expect to be able to watch those movies any time soon!

Super Bowl Advertising Part 2: When $100K per Second is Good Value

The cost to buy advertising time during the Super Bowl is expensive… too expensive for many companies to even consider or it simply does not make sense in terms of ROI. But, if a company has sufficient marketing dollars to spend on a Super Bowl ad spot, the investment may not be money well spent.

Granted, the cost of commercial time is high- $2.7 million for 30 seconds this year. Add to that figure the cost to create a commercial and an advertiser has easily topped $3 million for its investment in the big game. The total cost incurred means that an advertiser is paying $100,000 per second to reach the Super Bowl audience. The size of that audience makes the Super Bowl an attractive marketing vehicle; this year’s audience is expected to be as high as 94 million people. So, if an advertiser spends $3,000,000 for air time and production, its CPM (cost per thousand people reached) would be about $32. The cost efficiency as measured by CPM makes Super Bowl advertising appealing, even if the outlay is quite high.

The question a potential Super Bowl advertiser must ask given these considerations is “How many of the 94 million viewers are part of my target market?” If it is believed the audience has substantial overlap with a brand’s target market, then Super Bowl advertising may be the best $100K per second a marketer ever spends!

Super Bowl Advertising Part 1: Don’t Overlook Non-Traditional Audiences

This week’s postings will be devoted to Super Bowl advertising. Today, the question is who should be the target audience of Super Bowl commercials? The obvious answers are men and sports fans. Such a generalization of the target audience for a televised sporting event works most of the time, but this is the Super Bowl. We are talking about a cultural event as much as we are talking about a sporting event! The audience will be very diverse demographically.

One example of a non-traditional audience marketers would benefit from reaching throught the Super Bowl is moms. According to a survey done for the Marketing to Mom’s Coalition, 80% of moms surveyed said they would watch the Super Bowl. Perhaps more importantly, 60% of moms said they watch the Super Bowl to see the commercials! So, the idea of targeting women with a 30-second Super Bowl spot is not so far fetched if the survey’s findings mirror the behaviors of moms across the general population.

Yes, it could be argued that marketers of products targeting moms would incur a certain amount of wasted spending reaching people not in their target audience. However, ads that target moms make more sense than a B2B marketer like Sales Genie, a business database and list company, running a spot targeting businesses to inquire about its list services. Reaching audiences is an expensive proposition during the Super Bowl ($2.7 million for 30 seconds), but for some brands it could be an opportunity to reach their audience through a different, yet engaging media vehicle. Link

Advertising on MLB Uniforms: Strike Out or Home Run?

The Boston Red Sox and Oakland A’s will kickoff the 2008 MLB season with a two-game series in Tokyo March 22-23. The games will not only mark the only time the teams will play outside North America, but it will also be the only time their uniforms feature corporate advertising. The Red Sox have struck a deal with EMC, a Massachussetts-based data storage company, for ad patches on their uniform sleeves. Both teams will have logos of Japan’s Ricoh Co. on their helmets.

Advertising on sports teams’ uniforms is not unusual in countries outside of the U.S. In our country, ads have encroached seemingly every inch of space at our sporting venues except for players’ bodies. Venues have corporate names and signage is everywhere from the turnstiles to toilets. Baseball is a sport steeped in tradition, and corporate logos on uniforms certainly is not part of that tradition! An uproar occurred in 2004 when MLB considered putting ads for the “Spider-Man 2” movie on bases for one weekend. It is highly unlikely that American sports fans will change their views just because uniform ads are accepted practice in other countries.

While there is no indication that MLB is considering allowing uniform ads, it may be testing the waters by allowing the Red Sox and A’s to wear ads in Japan. The economic state of baseball is probably as good as it has ever been, so there is not an urgent need to tap into the revenue stream that could come from uniform ads. and considering the game has more important issues to deal with (i.e., steroids), allowing uniform ads would not be a wise move at this point in time. Link