Tuesday, May 25, 2010

Taste Chocos Dosa @ KeLOGIN- Online Marketing redefines offline marketing

AOL's( online entertainment company)  takeover  of Time Warner (offline media conglomerate) in the year 2000 was the harbinger of how online world would potentially influence the happenings in the offline space. This influence is in an accelerated mode after the birth of interactive web or web 2.0

Web 2.0 has redefined traditional consumer marketing. Traditional marketing is always about creating products,right pricing, back it up with aggressive advertising/communication and having a robust distribution system in place. Getting the marketing mix (4P's) right is considered as the formula  for success.

The web 2.0 and social networks have ushered a new era where brand "connect and experience"  are not just tactical initiatives but key strategic drivers for business growth .In today's context, brands meet the consumer where they are which is different from how traditional marketing companies operate. We see B2C brands like Red Bull,Whole Foods,Comcast and many other brands across categories connecting,interacting , engaging the consumer through social networks/interactive online platforms like Facebook,Twitter to create a wholesome experience for the consumer with the brand.To further humanize the relationship leading personalities represent the brand, as trust agents, in the social interactions. Example Scott Monty of Ford, Matt Cutts of Google....

This shift in interaction levels and new found freedom for the consumer in the online space will naturally have a cascading impact  on the interactions with brands in the offline space.Some brands have spotted this trend early enough  and are very aggressive on Below the Line ( BTL) promos which creates a brand connect with the consumer.On the other hand it is very tempting for large brick and mortar brands to negate this trend based on their conventional wisdom.Warning!!!! Don't wait any further.Brand's must " Connect and Create unique Experiences" for consumers and that is the future.Be it offline or online. Successful brands will try create many such opportunities for consumers... Reason for this shift:
  • Consumers have experienced this new freedom of interacting with brands up close,especially in the online space
  • This change in interaction will have an impact on consumers expectation of similar experience in the offline space as well- cascading impact
  • We live in an over communicated society with plenty of product options. The brands that humanize its relationship with consumer stand to gain

How can brands connect with consumers in the offline space,humanize relationships and create unique experiences? Lets try and attempt to do this connect using a popular brand.

Kelloggs- Popular Breakfast cereal

It took 16 years for Kelloggs to change the breakfast habits of Indians.When Kelloggs was launched in India in 1994, it didn't do well for 3 major stated reasons:

  • Indians are not used to having cold milk in the morning but Kelloggs cereal was well suited with cold milk
  • They had a rooster in th pack which made people think it was a non vegetarian product.
  • The product was not Indianized
Since then the product has come a long way in replacing the traditional Indian breakfast. How can they do better?

 Scene Change:Consumers connect visit to  beach in the morning to health and fun. Kelloggs have consistently positioned themselves as "fun & tasty breakfast".How can the brand use this opportunity to "Connect and create unique Experiences" for the consumer?.

The promo should be run as follows:
  • Kelloggs should open a cereal hut in the beach called as KeLOGIN(to make digital natives identity with the brand)
  • The store will be open only in the morning from 5am - 9am targeting the health freaks who come to the beach 
  • Consumers spend some time with friends and possibly catch up for breakfast especially during weekends.Use this opportunity...
  • Create innovative breakfast options using Kelloggs cereal apart from the regular ones and induce trial.. I remember one of the restaurants in Pondicherry had murukku sandwich (Indianizing sandwich) in its menu
  • Indianize it by creating new healthy and tasty options like Chocos Dosa,Museli Vada. I am sure culinary experts can help create such interesting options. If Oreo Pizza ,Panner Pizza can sell why not Chocos Dosa...
  • Consumer would want to try out new breakfast options and this approach will help consumers adopt cereal as a part of the breakfast menu
  • This promo will certainly create an opportunity for the brand to connect and create unique experiences.Marketers will gain immensely from this interaction between the brand and the consumer.
This is very different from the traditional approach of advertising, store merchandising and other promos which will result in one way communication between the brand and the consumer.

After this unique experience, the brand will possibly be top of mind  for the consumer which will lead to positive word of mouth hence retail sales will pick up.

Am hungry... lets meet at KeLOGIN for a Chocos Dosa...Sounds crunchy :-)  

Tuesday, May 11, 2010

Way to Influence purchase at a store - Create Panic

Conventional wisdom always states that consumers wish to have a clear idea about any product or service before they buy.Clear explanations of product through simple product brochure, transparent sales process, organized sales stores are believed to be sales enablers.

I did believe these "cast on iron" tenants as truth till I heard an interesting anecdote from my friend on how a chaotic and panic stricken environment helped create better sales for a product. Wait!!! Isn't it contrary to the conventional wisdom that we have since time immemorial. To understand the reason for this consumer behavior lets explore few situations:

1. Deep Discount sale @ clothes factory outlet during Christmas or Diwali
2. Jewellery purchase in India especially during marriage season or Akshaya Tritiya
3.Purchase of electronic goods at stores like Best buy or Chroma especially during festive days like Thanks Giving Day or New Year Sale

What is common to these environments beyond just great deals? Crowded stores.. Have you ever noticed why most of these purchases happen in a crowded environment? I am sure you would have walked out of the store after the purchase with exasperation and the common complaint why cant the stores be more organized?Believe me, the next time you visit the store,the chaos would have just increased.

But why did the consumer begin acting that way when it's clearly not in his nature to do so? Simple. Because everyone else was doing it. So many others were doing it, in fact, and doing it so loudly, he/she will find it impossible to just sit there without acting.

Dr.Robert Cialdini,in his book Influence: The Psychology of Persuasion (Collins Business Essentials),calls it as the Rule of Social Proof ."Social Proof is what psychologists call a "decision heuristic" — a shortcut for making decisions. Life is too complicated to carefully evaluate every element of every situation, so we learn to take shortcuts to help us make what are usually reasonable and reliable decisions".

The reason for the consumer behavior to purchase despite panic/chaos can be deduced as follows :
- Crowd and chaos creates panic
- Panic sets in ambiguity
- When we feel ambiguous, we look for people who are similar to us and take decisions based on their actions
- Greater the number of people who find an idea correct,more the idea will be correct

When overwhelmed by the panic & chaos, consumer ends up thinking that the offer in hand is a dream deal and it cannot wait for the next day. The 'Suspension of Disbelief" results in a purchase without thinking, contrary to our conventional wisdom.

How can this technique of influence "Social Proof" be exploited by online marketers? While there are welter of ideas like limited period offer,testimonials, products sold for the dayetc, it's worth exploring an online shop where there marketer builds crowd and chaos by giving the consumer the option to user Nag,Tag (go social) and haggle at the online store to help make a purchase. Going social (integrating the online shop with Facebook, Blippy)at the time purchase will create enough noise for chaos to set in and then we know the consequence.The consumer ends up purchasing from the online store.My guess is that this kind of selling will be better suited for low cost, discount stores especially when the consumer is not sure of his purchase. Atleast worth exploring...

This influence technique appears to be a negative but in reality thats how consumers behave.Smart marketer will be on the lookout for this kind opportunity.

Beware... don't enter a crowded shop...