Posts Tagged ‘Social Networks’

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Rising from the Ashes? – Woolworths goes Online

April 11, 2009

The recession hit many businesses hard, even long established brand Woolworths, Britain’s major retailer, suffered massively and was forced into receivership and finally went into liquidation.

woolworths shut store

The high-street chain collapsed in November 2008, only one year before its centenary. Founded by Franklin Winfield Woolworth in 1909, Woolworths established into a 800 chain giant. Right from the start selling a variety of merchandise such as toys, sweets, children’s clothing and haberdashery. Thanks to mass production “Woolies” was able to be very price competitive and that is how they outperformed many British competitors when it came to china and glassware. According to Lavan from The Times Online,  in their first year of trade in Britain they offered free pots of tea to customers and introduced new shopping experiences through an American store layout encouraging to browse around (read more here).

woolworths-sheep-and-dog

But competing on price only is a risky game. Referring to the BBC , the main problems arose when it was heavily undermined by Amazon and large supermarkets like Tesco started selling non-food products (full story here).

Generations of shoppers commiserated with the sinking ship of Woolworths, a brand the grew up with, liked and trusted. A high amount of affection was shown when the brand’s followers on social networking sites started to increase when the recession started to kick in and Woolworths’ breakdown was covered all over the media. Referring to Marketingmagazine, Woolworth’s group on Facebook has rapidly increased exceeding a number of 23,000 members showing sympathy and sharing affection.

Whilst some were going under, investors caught interest and started to see potential business opportunities. A famous example is entrepreneur Theo Paphitis, who successfully turned around struggling and troubled retail businesses, such as the one of lingerie chain La Senza, which was one of his biggest successes (more). He is also known from the popular BBC programme “Dragons Den“, where according to BBC his focus belongs to the inheritance of his children and he is known for the sentence: “Why should I part with any of my children’s inheritance investing in this?”

woolworths-theo-paphitis

Finally, the company was bought by the Shop Direct Group and Woolworths’ are now back with a new customer focused and very interactive online strategy.  Shop Direct Group the result of a merger between Shop Direct companies and Littlewoods in 2005 is one of the UK’s largest online retailers. Despite Woolworths’ popularity critics were arguing that Woolies were “out-of-touch”, lacking customer focus, as well as interaction. With reference to Manning from the Mirror, Woolies had no real unique selling point: “It is a jack of all trades, but a master of none”.  He also refers to it as outdated in an era where online shopping is outperforming shopping in giant out-of-town centres (read more).

This shall all be changed with the new business model and a vibrant marketing strategy. Shop Direct Group’s new strategy is to reduce Woolworths’ operations on only online with a strong focus on customer information and involvement through interaction. Woolworths has been relaunched online with a very strong web presence.

Shop Direct Group, which is preparing for Woolworths’ relaunch in the upcoming summer is certainly doing a good job and improving main weaknesses. It seems like they have recognised the power and opportunities that lie in online social networks. As a sign of high interaction with customer they are collecting feedback and areas of interest through social network pages Facebook, Twitter, Spotify and last fm. They set up groups called “the first single I ever bought” and encourage users to list their experiences and create a “nostalgic playlist”. Marketingmagazine states that well renounced agencies Glue London and The Brooklyn Brothers have been appointed for Woolworths’ social media presence and engagement. In order to keep customers up to date with newest information they regularly put information on Twitter, Facebook or their newly created blog (www.woolworthsblog.co.uk). This move enables them to be much more transparent and automatically provides Woolworths with more closeness to its “followers” and their feedback. A great way for their online reputation management as well as a source for ideas or concerns from interested individuals.

On Twitter they recently tested if there is any demand for some of their new offerings and according to Marketingmagazine, Twitter followers were prompted to list their top five Woolworths’ products – a great way to conduct market research in order to detect customer’s favourites (Read more).

Moreover they have created a page specially for Easter (www.woolieswonderland.co.uk) – a page that encourages its visitors to find six virtual eggs in order to secure a place in a prize draw to win a family home entertainment system…and of course to drive web traffic and collect contacts, but don’t tell anyone 😀

woolieswunderland

All in all it seems that Woolworths is on the right course. By applying clever and strategic marketing techniques and using appropriate new media tools, they can reach their audience, engage with them and discover what are the right steps to do next in order to have a successful comeback as an online store.

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Apple vs. Blackberry – The Battle Goes On!

March 21, 2009

I have already discussed the popular “video clip battle” between Apple and Microsoft in one of my previous articles and also the fact that others take advantage of the idea and use it for their own purposes (when two quarrel the third rejoices). Thanks to my brother my attention was drawn to an article in a Swiss newspaper that reports on a new battle, but this time between RIM’s (Research in Motion) Blackberry and the iPhone, a registered trademark of Apple. Currently there is a sequence of three videos circulating.

It starts with a video in which Blackberry attacks and beats the iPhone. At the end of the clip the following slogan appears: “The world’s first touch-screen Blackberry. Nothing can touch it.”


This video has been on YouTube only for three and a half weeks and already has 753,762 views. (Since March 25th the video I was refering to “BlackBerry Bullet Shows Apple Who’s Boss is no longer available due to a copyright claim by Death Songs LLC and hence the views with the new one are different) According to Tagesanzeiger it did not take long before a second video came up. Or was it Apple’s answer? Nevertheless, the following clip appeared two weeks later on YouTube and finishes off with the words: “simple facts”.

There are 155,759 views after 8 days on YouTube. What until now looks like a quarrel between Apple and RIM appears to turn into an advertising campaign for the site PleaseFixTheIPhone a page that collects improvement recommendations and complaints from iphone users and lovers (the best mobile phone on Earth, ever!”) and formulates them into wishes. At the moment this page lists 2,250 wishes including 659,181 votes made by people who agree. Wishes can only be placed by people who have a Facebook account. They claim not to be affiliated with Apple and pronounce: It’s a modern love poem from iPhone fans who just want to improve their iPhone.

Listing 5,220 views on YouTube within 10 days even this one shows rising popularity. With reference to OnlinePC these clips were neither a strategy from Apple nor from RIM, but rather a hidden campaign made by the digital advertising agency Guava. Rumours are circulating that Guava may have created the clips with the objective to promote its own services as a digital marketing agency. If that were true it would be a similar move to the one by Giovanny Gutierrez from Tinsley Advertising, who filmed his girlfriend playing Nintendo Wii’s “Hula Hoop” game, only wearing knickers and a t-shirt. He stated that he didn’t intend any commercial outcome but admitted having personal interest in getting recruited by Nintendo (read more). Tagesanzeiger reports (in German) that there have been no comments from Guava regarding their involvement with these clips yet.

If it were to be the other case and the first video has been developed by RIM, it highlights the importance of monitoring and controlling the World Wide Web consistently. The first video may have caused some serious damage to Apple’s brand reputation, which could have resulted in declining sales. By responding very fast with a similar video message Apple entered the battle, took the initial glory from Blackberry and did not let its “fans” down – in addition, it provided them with material to fight back on their blogs and amongst social networks. Brands which ignore their online reputation amongst social networks, blogs and communities are taking a very large, stupid and unnecessary risk. Not only is the use of the Internet and new media for marketing purposes increasing globally, but also the importance of being interactive online as a brand in order to satisfy rising customer interest and hence demand for online interaction is of an ever increasing significance. Through active online reputation management unfavourable mentions can be minimised by monitoring and influencing conversations in blogs and social networks.

However, all these videos have created buzz in a very short time and thus show high potential for viral campaigns.  They tick all the boxes by creating electronic word-of-mouth, making people discuss the involved brands (brand awareness creation) and reaching large numbers of individuals within very short time. It also shows that there is no need to have a stunning and exceptional new idea for each campaign. Already existing ideas can be creatively turned into diverse stories with different outcomes and intentions.


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ROI for BlendTec’s “Will it Blend?” Campaign

March 13, 2009
blendtec-total-blender1

"Total Blender" by BlendTec

In one of my previous blog entries some successful viral campaigns have been discussed and readers have shown scepticism about return on investment factors. This encouraged me to investigate a little further into the ROI factors of “Will it blend?” that represents a superb campaign which prospered massively.

“Will It Blend?” started as trial viral marketing campaign consisting of a series of commercial shows demonstrating BlendTec’s product the “Total Blender”.

BlendTec founder and CEO Tom Dickson grinds an unbelievable range of items in order to demonstrate the power of his product.

The idea came from George Wright, BlendTec’s vice president of marketing, who got excited about Tom Dickinsin’s extraordinary testing methods in order to assure the quality of his products.

“…The way he tests equipment is very extreme. And he does a lot of crazy things and this blender did a lot of amazing things under this destructive testing. My first thought was, you know I would like to see that happen the next time he does it. And then I kept thinking you know what? I bet everyone else would like to see that happen too, this is amazing staff – and so we did!…” (Hear the full interview with George Wright provided by Rocky Mountain Voices here or at PodTech)

They set up an account with the popular video sharing side YouTube on the 30th of October 2006 and currently have 172 658 subscribers, 3 270 602 channel views and 83 different video clips (see here). With the slogan: “See what the Total Blender can do in the BlendTec test lab, as we ask the question, Will It Blend?” they also encourage viewers to submit ideas of what they would like to see being blend.

According to an article by Information Week, George Wright, BlendTec’s vice president of marketing said that BlendTec suffered a lack of brand awareness, even being in the business producing commercial blenders for years. Operating in the B2B sector mainly, BlendTec introduced its blenders for the B2C market, but could not afford “tens of thousands for a marketing campaign” for a traditional above-the-line advertising campaign.

Wright states in the interview with Rocky Mountain Voices that social media such as blogs and the video sharing site YouTube, combined with the technology offered his company a great opportunity for more branding.  By aligning with the right social networks and some leading blogs within five days the campaing had a massive break through.

With reference to Econsultancy BlendTec’s site traffic has increased by 650% since the videos have been introduced. Both, Information Week and Econsultancy report that BlendTect’s sales have increased five-fold over previous record revenues. Additional revenue was generated through the ad-share program with video sharing network Reever.

This campaign enabled BlendTec an incredible media outreach and PR buzz which happened through third party endorsement and was not a prescribed expensive advertisement campaign. Of course not every viewer ends up becoming a new customer, but the campaign represents a breakthrough in demographics for BlendTech’s brand awareness and image creation.

A great example for the immense power of new media and social networks. Finally, the breakthrough of this campaign required a good idea, material for about $50.- and some hours of recording and testing – nothing in comparison with the costs of normal advertising campaigns!

Tom Dickson is my homeboy

Tom Dickson is my homeboy

UPDATE:

Thanks to George Wright I am able to update this post with some further information. I have asked him about offline effort related to the online campaign, as literature strongly recommends to have a combination of both online and offline promotion. He responded that is has been primarily an online campaign with only a few exceptions when it comes to traditional marketing efforts:

  1. we included http://www.willitblend.com on our packaging of our retail products
  2. we have hosted live blending performances at trade shows and corporate events
  3. we did have a billboard that we had made that is on the side of our building… proudly showing Tom blending a rake

It may appear like little efforts, but to me these were essential steps that needed to be done. Moreover a campaign that is covered online and offline receives higher degree of credibility and potential customer may perceive it as being “in reach”.

Step one shows additional awareness creation and increases traffic to their webpage. Besides that, it connects existing customers to fans or admirers of the campaign. Happy customers can turn into brand advocates, defend the brand from negative criticism or convince sceptics with their personal experience with the brand. They encourage passion and excitement which strengthens the online campaign and spreads positive word-of-mouth.

Step two serves similar principles like step two, as individuals got the chance to be part of a live “Will it blend?” showcase, which must have generated excitement, convinced sceptics and increased the desire: I must tell this story to people I know! Seeing the performance online is already pretty impressive, now imagine the impact if all that happens right in front of you. Event if I probably would not buy one of these blenders (they are pretty costly), I would definitely tell to people that I’ve seen it happen and that all is real… Some of my friends would then pass the message to others and spread the word that they know someone who has seen it and so one… And, a few links later probably someone will then defend the “Will it blend?”  campaign online by saying: no, it’s not fake, I know someone who has seen all that happen live – it’s all true. And if it all works ideally and any of my friends who runs a bar or restaurant should require a new blender I may recommend BlendTec!

Step three is probably the least effective method for brand awareness creation. People who live close or drive by notice the billboard. Hence, awareness creation happens within a geographically restricted area. Nevertheless, the word can still be spread wider. Besides that, I see other benefits from that move. By placing a billboard on their building BlendTec’s employees may have enhanced their personal feeling of commitment and pride towards the organisation. Having happy, committed and motivated employees is a remarkable part that adds to an organisation’s competitive advantage.

The more I learnd about BlendTec’s campaing the more impressed I am from what they have achieved! A prime example of a successful viral campaign that definitely deserves to be mentioned in future viral marketing literature!

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New Media for Viral Marketing

February 26, 2009

Viral marketing can be defined as a technique that encourages people to pass along a marketing message with the aim to create a potentially exponential growth in the visibility of the message and generates word-of-mouth marketing. This method relies on snowball system distribution that is characterised by a high pass-along rate between individuals. The overall growth is strongly linked to the amount of recipients and the percentage of those who forward the message to a large number of friends.

New media deliver a variety of great technology for viral marketing, given the immense speed a message can be delivered and spread around the globe.  Social networks and communities are an especially welcome target for such campaigns, due to their user concentration and information exchange rates.

In the area of B2C this strategy is often applied by start-up businesses in order to create awareness and build their corporate image. However, given the high degree of competition and creativity out there it is very difficult to succeed with such a campaign.

A prime example for the successful viral marketing application is the free web mail service Hotmail, now provided and owned by Microsoft. Each time a message is sent, Hotmail promotes its corporate commercials in the e-mail notes of the user.

Another way of viral marketing was provided by Nike in 2006. They broadcast the football legend Ronaldiño trying on a new pair of trainers and delivering an absolutely fantastic showcase of football tricks. At this time the clip has 27,496,830 views on YouTube and despite how old the video is, there are still discussions going on about it. In my case, the latest post for that video was 32 seconds ago.

[Youtube=http://www.youtube.com/watch?v=lsO6D1rwrKc&rel=0]

Blogstorm present a top 10 ten list of viral marketing campaigns where the Nike clip takes the leading position.

Cadbury’s are another organisation that are very successful with their campaigns for “Diary Milk” chocolates which listed as made by “A Glass and a Half Full Productions“. In reality Cadbury’s success is due to London based agency Fallon, who have done an exceptionally great job in marketing the brand. I suppose we all know the clip in which a gorilla hits the drums with such incredible passion with Phil Colins’ song In the Air Tonight (this song has been deleted form the video due to  Copyright reasons by the way. Nevertheless, the clip is now available in various other remix versions, implemented by creative non-corporate individuals). The currently new clip of Cadbury’s shows two children with freaky eyebrow moves. Initially broadcasted on TV the clip now enjoys rapid distribution on the World Wide Web and currently has 2,282,533 views.

[Youtube=http://www.youtube.com/watch?v=TVblWq3tDwY&rel=0]

Not only businesses know the true promise of viral marketing, but also individuals use it in order to increase their success. The British op singer Lily Allen produced a spoof of the Cadbury’s adverts that was shown on Channel 4. It is also posted on YouTube and has currently 587,106 views since the 9th of February 2009 (see video).

The inspirational comedian Judson Laipply hit the mark with promoting his show case “The Evolution of Dance”, an incredible achievement. With reference to Readwriteweb in 2007 his video was the most viewed one on YouTube and in 2008 it still reached the second position. Right now it lists 114,755,890 views. In his context, new media and social networks helped him to make his career worldwide.