Thursday, June 7, 2012

JC Penney hits the wall

So JC Penney found out what other retailers have known all along. When you sell the same things as everyone else and you can't provide superior service, price matters.

After 3 months of stylishly promoting their subtle version of a monthly sale...

They're admitting defeat.

"No one really understood [month-long value]. What we intend to do is a sale; we run 12 a year," JC Penney CEO Ron Johnson is quoted as saying in Advertising Age.

But changing the words from "month long value" to "sale" won't turn around their fortunes. There are already at least three entrenched competitors that consumers look to for low prices, Walmart, Target and Kohl's.

Making their sales events a month long and promoting them less won't suddenly have consumers breaking down the doors. Retail is a now business. If the advertising doesn't make the cash register ring on the first weekend of the month, it won't magically become effective on the last.

What they really need is something to differentiate themselves beyond mere marketing. And that won't be easy.

Just ask Sears.

Wednesday, June 6, 2012

Why Facebook fails brands

In a recent poll from Reuters/Ipsos, 80% of Facebook users report that they've never interacted with an ad on the social networking site.

I'm not surprised.

And here's why I won't be surprised if Facebook – even with nearly a billion users – never lives up to its promise of becoming a magical place where brands and consumers can form a more perfect union.

People don't come to Facebook to interact with brands. They come to interact with their friends and family.

I can hear you saying, "They don't come to TV for the ads either," and you'd be right. But there are a couple of key differences.

First, people accept ads on television because they pay for the content. Their expectations on the internet are different as every publisher and content provider has discovered.

Second, you don't interact with television. You sit back and let the content waft over you. Sure, you may flip between channels or fast forward through the spots on your DVR. But for the most part, ads are a part of the content not a little bar off to the side.

When I'm on Facebook, I'm looking at my newsfeed. I'm reading posts. I'm commenting on photos. I'm ignoring Socialcam and all those other insidious apps.

What I'm not doing is looking at the ads.

The answer may be to create promoted posts as Twitter does, but I'm skeptical of that. Having your brand's message show up uninvited on a timeline would be akin to walking up to people engaged in a conversation, interrupting them and trying to sell them something. It's the wrong place and time even if they happen to be talking about you.

The opportunity for brands on Facebook is just as it is for any other word of mouth communication; do something interesting, do something remarkable, solve a real problem for people and maybe they'll talk about you.

Elbowing your way into the conversation won't endear your brand to anyone.

Tuesday, June 5, 2012

Doing well by doing good

You have to hand it to the folks at Disney. They are smart.

Today, they're announcing a new initiative along with the First Lady that among other things, limits junk food advertising on their networks that target children and reduces the amount of sodium in meals in their theme parks by 25%.

You'd think that cutting off your content platform to some products from advertisers like Frito Lay, General Mills, Coke and others would be bad for business.

But you'd be wrong.

Along with the shift in ad policy, Disney is introducing an endorsement program where a branded food item that meets Disney's standards (not the FDAs) will receive a "Mickey Check" – a sticker on the package signifying its goodness.

I'm guessing the check isn't going on every product in the store that meets their standards. In fact, I'm pretty sure it will only be available to those companies pay Disney a lot of money for ad deals or other marketing programs. 

I'm also certain a there will be a royalty involved. So for every carton of juice sold that sports a Mickey Check, Disney will make a few pennies. Given the amount of "healthy" processed food sold across the U.S., those pennies will add up quickly, covering the cost of the few advertisers who are cut out by this program.

Proving once again, that doing good can be very, very good business.