Lairig Marketing

Truth In Labeling – Who Cares ?

More government regulation threatens. If you damn people won’t stop overeating, the Feds are going to try everything in their power to make sure food-package labels make you think twice about reaching for those chocolate cream-filled cookies.

The current debate, as you might know, concerns the acronym “FOP,” referring to “front of package.” For those of you who get all Andy Rooney-like frustrated flipping the package round and round and upside down looking for the nutrition label, help is on the way.

The Grocery Manufacturers Association (GMA) and Food Marketing Institute (FMI) are trying to get ahead of what will surely be tougher specs from the FDA, and have proposed their own solution to listing essential nutritional information on package fronts.

Millions of anxious hours, debate, and money that shall all come to naught. Why?

Because most consumers wouldn’t bother to read nutrition information even if it came as a post-it note hanging from the box.

Some University of Minnesota researchers did a study to compare shoppers’ claims to their behavior when it comes to reading labels. As you might expect, claims were higher than actual behavior. By a lot.

In the study, nearly one-third of consumers claimed to look for label information on calories, fat content, sugar, etc. Yet eye-tracking data in the study showed the actual viewing of this information was in the single digits.

Since the University of Minnesota study was conducted using computer simulation, with the nutrition “label” served up to the consumer, this finding is sort of astounding, and implies the results would be still lower in a “real life” shopping experience.

Which says FOP is FUBAR.

It makes me wonder about all the other useles drivel companies cram onto a label. How much of it ever gets read?

There are about twenty touch points prior to when the consumer reaches for the box or can (or whatever) on the shelf. If you’ve done your marketing job properly, the package just needs to have your name and the product picture on it.

Which will leave plenty of room for whatever else the FDA thinks should be on there.

Friday Fast Four – Special Zombie Issue

Quick intro for Lairig Marketing newbies – this is our weekly follow-up on four of the many marketing trends we’ve posted about previously.

The Walking Dead
Mo’ money (lost), mo’ money (lost). We’ve been harping on it, and Microsoft refuses to let us down. Another quarter in the financial books, and its “Online Services” division ended up with another negative profit of ONE HALF OF ONE BILLION dollars. Better than Herman Cain’s approach to avoiding corporate taxes.

Not Quite Dead Yet
It's been awhile since we've updated our list of marketers investing in TV advertising for the first time ever (or for the first time in several years). Here are some more – mud in the eye for those “TV is dead” hacks:

- Norwegian Cruise Line is returning to network TV advertising for the first time since 2008.
CEO: “We felt this is the right time to issue this bold invitation to cruise with us by piquing interest and creating excitement around our brand.”

- Fairfield Inn & Suites by Marriott is launching a new ad campaign that includes a return to TV after a six-year hiatus.
Brand Director: “We felt it was critical to tell the story about the brand in an emotionally engaging way and we know TV/video is one of the best vehicles to drive home that sort of message.“

- Ask.com – see the next item below.

We Ask You, We Beg You – Please, Finally Die!!
The little search engine that couldn’t, Ask.com, should change its name to Lazarus. Now in its 452nd business iteration, Ask will be advertising on TV once again, to showcase its “vastly improved” search capabilities. With 3% market share, and zero upside, however, Ask needed to compromise on production budget. The ads were shot by the brother of Ask.com’s CEO. Oh brother…

Dying By Cuts
Further validating our theory that “smaller” wins, another company is dividing itself in two. Abbott Labs announced it will spin off its branded drug business. Analysts believe J&J and Pfizer are next.

Size does matter, after all.

AdWeek Still Weak

Michael Wolff tried. We even told you how optimistic we were about the “new” AdWeek. Alas, slightly offbeat, cultural-centric articles about the advertising industry hold no flame to the repetitive daily tripe about social media, search engine marketing, and mobile apps.

AdWeek will plod on, with its “journalists” attempting to mimic Wolff's style. Such as the article posted yesterday by Erin Griffith. A backslapping, suck-up pean to Coupons.com that told us nothing we didn’t know – yes, it has attracted lots of VC money; yes, it is valued at $1 billion; and yes, it will go IPO. So?

“Coupons.com is the silent, cash-rich killer of the once-fat Sunday paper ad section.”

Killer? That would be news to the FSI industry, which still commands 85%+ of coupon distribution in the U.S. [source: Valassis]. As Joe Jackson would sing: “You can read it in the Sunday Papers.”

Wolff’s style, sans facts.

“Redemption rates on old-school paper coupons [sorry to interrupt – but see the 85%+ share for “old school” above] have fallen from a sad [Wolffish] 1.6% to an even sadder [Wolffish] 0.6%...Coupons.com’s rate is more than 18%.”

Since the article included a faux interview with Coupons.com's CEO, there was no way to validate this crazy number, I guess.

Allow us.

Here’s how newspapers do it. Count all the 350 billion coupons printed and distributed per year. Denominator. Take the 2.1 billion coupons collected at retail. Numerator. Presto = 0.6% redemption.

What would be the equivalent calculation for Coupons.com? Take all the coupons posted on its site, regardless of whether a site visitor looks at all of them. Denominator. Same process as the numerator above.

The only way to get 18% is to seriously undercount impressions – by claiming only the coupons a user downloads (which would be equivalent to “clipping”) – or by claiming downloads as redemptions.

Net net: The 18% coupon redemption rate for Coupons.com is complete bullshit.

We’d welcome Erin Griffith into our Research Hall of Sham, except she didn’t DO any research.

We could start a Journalism Hall of Sham instead. But that would be redundant.

One Potato Two Potato Three Potato…NONE?

That’s it. I’m joining the Tea Party. Or at least the Potato Party.

In one more illustration of its wrongheaded meddling, our government wants to legislate the number of spuds kids eat at school. Sounds like a paradox, coming from the U.S. Department of Agriculture, no? One would think it would be on the side of the farmers.

But, no. It is part of the “federal school lunch program,” probably one of the least effective initiatives per dollar of input ever created (thank you, Harry Truman). The USDA has the time and energy to waste on declaring that, starting next year, school lunchrooms must limit the number of servings of potatoes to twice a week if they want to continue receiving federal subsidies.

It’s all part of the war on childhood obesity, of course. However, until the USDA, or other federal agencies, can legislate the following for schools, the “potato cap” will get us nowhere:

• Mandatory exercise during the school day
• Inspection of bagged lunches brought from home
• Eradication of in-school vending machines

This whole thing has set off a Congressional battle, with potato-farming state Senators defending their literal turf. Won’t be long before we hear something like this in a Republican debate: “Mr. Romney was for potatoes before he was against them.”

Now you know why we have lobbyists and industry associations. Like the National Potato Council (hurry – tickets on sale for the January Potato Expo in Orlando – Orlando?!?!). They are a tax on every industry, to keep government hands off.

What doesn’t happen often enough, though, are responses directly from the marketers of “end products.” The CPG guys who market potato soup, potato pancakes, potato this and potato that, should think about the messaging they could add to their normal marketing efforts to counter what could become a slow, secular decline in potato demand promulgated by a school lunch cap.

In the meantime, the National Potato Council might steal a page from another food group's playbook.

Recession Stares – Retailers Blink

If you didn’t like our Great Recession Part 2 forecast a couple of weeks ago, maybe this AP article from yesterday will do the trick.

A seasoned marketer might have moved right past the dopey headline: “Price Matters For Holiday Season.” That’s been true for three holidays in a row now. No news there.

For example, from the article:
“In a recent poll of 1,000 shoppers by America's Research Group, 78% said they were more driven by sales than they were a year ago. During the financial meltdown in 2008, that figure was only 68%.”

Note the use of “only,” when the number in reality represents TWO-THIRDS of shopping public. This is just a little more recess for your recession.

This time around, I fear, the numbers are driven by consumers seeing the fear in retailers’ collective eye. The AP article lists several examples of big-name retailers promising not to be beaten on price. (To show how limitless its dysfunction is, Sears promises to beat any price BY TEN PERCENT!).

Remember, too, these holiday strategies come in the midst of forecasts for a banner Halloween, as if anyone cares.

In describing its plan to give consumers gift cards if they find a better price elsewhere, a Walmart exec had this to say about what he called the other guys’ “promotional intensity and gimmicks.”:

“[our gift card plan] gives customers peace of mind that we are an advocate for them…"

No. It shows consumers how panicked they should feel, a full month before Black Friday.

Another retailer was quoted as saying “The days of marketing the stuff in your store because it was a hot brand are over…"

I’d say that the day you call the stuff in your store “stuff” is when you should pack it in.

Congratulations retailers, for not even trying. You might have just marked the tipping point for Great Recession Part 2.

Teaching Kids The “Pay” in Paywall

Earlier this year, in a post about the new paywall at The New York Times, we discussed its likely impact on Gen F (aka Millenials, Gen Y) and highlighted this precious quote:

“As a young adult in graduate school, I frequent the Times’s website every morning…classmates and friends share this love for the Times…we can, and will, move to a free option…you will lose the vast majority of young adults…”

That was from a girl named Erin, writing to the Times back then. Wish we could see what she thinks now.

Because, as we predicted in a separate post (and the only blog we know of to say so), the Times paywall has been a success. Beyond the fact that its paying subscriber count is north of 300,000, there is this data point: the number of unique visitors is up.

Still, Gen F is a stubborn sort, so some experienced people are looking to help them down from the ledge, gently.

Press+, a company that manages both sides of paywalls, helping papers set them up and allowing readers to access subscriptions through a single portal, is partnering with the Knight Foundation (which supports advancements in journalism) to help college newspapers set up paywalls for their online versions.

“Hah!” you say. “Suicide. The kids will laugh them right off campus.”

True, if Press+ had done what it traditionally does with paywalls. But it knows the toll that helicopter parenting has taken on this group. Instead, it will install a faux paywall, that will be geared toward “donations” from “parents and alumni.”

Which is kind of how Gen F has been doing things all along.

Ironically, Press+ is providing this service FREE to the first 50 papers that sign up.

A Press+ exec was quoted: “This generation needs to find new revenue streams, including new ways to collect revenues from the readers who get the most value from access.”

That would mean collecting money from fellow students. Until Gen F takes that challenge on, the Press+/Knight Foundation initiative, as laudable as it is, might be the smallest baby step ever taken.

Friday Fast Four…It’s Getting Spooky Out There

Another Friday, another chance to recap some of our best stories.

The Most Important Data Point This Year
Every now and then we rail against the craptastic customer research conducted in the marketing industry with our Hall of Sham award. Not sure what to say about this next one, except to wonder how Mommy Bloggers missed it.

According to a survey of moms by Sara Lee, and we quote: “60% of U.S. women who ever make deli sandwiches at home struggle with some aspect of making the perfect sandwich.” Well, f*ck me. Forget #OccupyWallStreet. Let’s start #OccupyTheKitchen!!!

Do Know Evil – Part 1 Billion
We must have pissed Google off. Lairig Marketing has now gone two weeks without being indexed on Google Blog Search. Regular Google Web Search continues to run 3 to 4 days behind. I thought “Pandas” were supposed to be nice?

And by the way. No sooner had we dropped a cool $1000 on a fruitless Google paid search marketing campaign, Google announces a new approach to AdWords. It will now scan your pages and TELL YOU what your keywords are. All you need to do is just keep shoveling cash into the credit card account Google has on file for you.

We Demand Death
Demand Media, for whom we’ve pounded the table to warn you away from its lousy business model and stock, continues to see its share price drop like a stone.

Today, we inaugurate the “Demand Media Stock Death Watch.” From an IPO high just over $25, you can pick some up today for a Subway footlong plus tax and 25-cent tip. The only thing that will halt DMD from going to zero is an acquisition by Yahoo! or Microsoft.

Another Watch To Watch
While we’re at it, we should also inaugurate a “Recession Watch.” We told you a couple of weeks ago it is upon us, so what validation can we find?

Let’s start with this item: The hapless Citigroup CEO Vikram Pandit was quoted as saying he “doesn’t believe the U.S. will slip back into recession.”

Thanks, Wrongway Feldman. That’s good enough for me.

CMOs Need to P More

Another week, another CMO survey. Another one that will have the lifespan of a horsefly. Or maybe the tenure of a typical CMO would be a better metaphor.

Anyway, that marketing juggernaut, IBM (*sarcasm*), last week released an executive summary of results from interviews with 1700 CMOs. The marketing trade unsurprisingly picked up on a couple of unsurprising points:

• CMOs still aren’t ready to use all the customer data at their disposal
• CMOs haven’t put social media at the top of their priority list (tsk tsk *sarcasm*)

Everyone seemed to miss this little nugget at the bottom of page 6 of the eight-page summary, which followed a chart illustrating, for the billionth time in CMO-survey history, that “marketing ROI” is the brass ring:

“…if CMOs are to be held responsible for the marketing returns they deliver, they must also have significant influence over all four Ps of marketing: promotion, products, place and price. Surprisingly…CMOs told us they exert a strong influence over promotional activities...But in general, they play a smaller role in shaping the other three Ps.”

Let’s put the price “P” aside for a moment (let the Finance guys figure out how to balance margin goals with pricing the market will bear). How can CMOs succeed if they are not contributing in a big way to product and go-to-market initiatives?

Hint: they can’t.

Which means the Marketing department and all its minions fail too. (P.S. To understand what’s really holding Marketing back, the next survey someone does should be at the middle manager level – they’ll get an earful.)

Some Things Marketing Should Do With the Product “P”
- Align offering strategies with targeted customer segments for both acquisition and upsell
- Manage the flow of new-product introductions, and ensure each one’s value proposition is tight
- Monitor, analyze and drive customer feedback to the Product Development/Engineering team

Some Things Marketing Should Do With the Place “P”
- Know what % of sales comes from which channel, and what the corresponding marketing investment % is for each
- Be a key part of an annual plan for channel strategy – the best path(s) to market for each product
- Gain a deep understanding of the customer journey for each segment (hint: don’t assume the entire purchase process is done on Twitter)

Each one of these “things” could be its own post. It’s hard work, and requires a lot of cross-organizational effort.

Which is good. Because the more it gets around to the other parts of the company, the less likely other departments will wonder why Marketing is P’ing so much.

The Online Consumer Is Out Of Control

You’ve heard it since circa 2000: “It’s a brand new world out there. The consumer is in control. Of everything, INCLUDING YOUR BRAND.”

This sentiment was born from the consumer’s ability to simply surf the Web. Have mouse, will travel.

From a content standpoint, it wasn’t true, as people flocked to sites that everyone else did. A popularity contest. How else to explain Vevo, or Mashable?

More striking is “control” from a data standpoint. Over time, we’ve come to learn that every single thing we do on the Web is tracked. By hundreds of third parties who attempt to define who we are by what we do online.

Based on that information, in theory at least, marketers can send us “targeted” advertisements, messages that match our interests.

It has been an abject failure.

Check out some of the sites below to see for yourself how much each tracking company knows about who you really are.

• http://exelate.com/new/consumer-privacy/exelate-opt-out/
• http://info.yahoo.com/privacy/us/yahoo/opt_out/targeting
• http://www.google.com/ads/preferences
• http://tags.bluekai.com/registry

Only one of them knows my gender and age range. Another has me pegged as a computer programmer. Another thinks I am a finance professional (note to Occupy Wall Street – I AM NOT). How ”well” do they know you?

Sensing this, data-tracking companies like the ones above give you the option to correct inaccurate or missing information in your online “profile.” My guess is that somewhere around 0.7% of Web surfers have done so.

Rather than throw in the towel on this Search For The Holy Data Grail, a few entrepreneurial sorts are dressing it up as a complete “personal online data management” service, according to AdWeek. One of the companies even gave itself the name “Personal.”

There, instead of helping out by simply checking a few boxes on a profiler, Personal will let you store and categorize your actual transaction data. This is called “handing over the keys to the kingdom.”

I would also call it “giving the supposed already in-control online consumer MORE control by letting them give outside companies ALL their private data so marketers can REGAIN CONTROL.”

I’ll estimate that 95% of the online population is going to give a big fat “opt out” on this one. The best “control” feature ever invented.

will.i.am: what.a.scam

How did you do it…
Get Ad Age to publish your advertising manifesto…
Written in word bursts…
Style over substance…
Like your music…
Tonight’s gonna be a good night (repeat 100 times)…
I guess it was supposed to reflect the new “conversation” style…
Where one piles on derivative non sequitur after non sequitur…
That is redundant by the way…
Like this sentence you wrote…
“twitter is a physical representation of collective consciousness where you can tap into the consciousness of millions”…
Anyway, not really…
Twitter is collective narcissism…
You wrote 675 words overall…
And not a single thought that was new for the marketing industry…
“…your brand need[s] to be a part of the connection…”
Really? Hadn’t heard that one before…
And this one was a classic…
“today…to have a business…you need to go where the people are”…
Who builds a business where the people aren’t?…
Worse, though, is that so much you wrote…
Or think…
Is wrong…
Like “the ones that are prospering don't have commercials but still succeed”…
Which, by the way, is another redundancy…
Tonight’s gonna be a good night (repeat 500 times)…
Anyway, Apple spends hundreds of millions of dollars on TV ads…
Thought you might like to know that…
Decrying TV ads sounds funny coming from a (disastrous) Super Bowl halftime act…
Your payoff (finally) is that brands should build communities…
Nonprofits, maybe…
But profitable brands should sell shit…
But deep down you know this…
How else to explain this press release from Intel last month…
“Sunday night’s Emmy Awards marks the U.S. debut of Intel’s latest TV commercial…
The first scored by will.i.am”…
I would call you a hypocrite…
Intel calls you its “director of creative innovation”…
Once again, redundant…
Tonight’s gonna be a good night…
Repeat a billion times…
Then fade out…
Please.