Understanding Online Habits of Social Moms

By Priya Ramesh (@newpr) 

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Sat, May 13th is Mother’s Day and several consumer brands are busy finalizing their campaigns this week to win the attention of moms  who now control $2.1 trillion in household spending (Source: Mom 3.0: Marketing with Today’s Mothers by Leveraging New Media and Technology). Oh and new moms on an average spend more than $10,000 in the first year of their child’s life. That’s a lot of money in the hands of moms making purchasing decisions on household items, consumer electronics and automotive and social media adds an additional layer of influence on how moms shop online.

Moms are no doubt a powerful influence on what products make it from the shelf to their homes. A little bit of understanding on how moms interact online, what do they look for in terms of product promotions and what are their sought after social channels might help us fine tune our marketing efforts. The best thing about marketing to moms is that if you do it right, you could possibly have a loyal customer base. According to Maria Bailey, author of Mom 3.0: Marketing with Today’s Mothers by Leveraging New Media and Technology, “Mothers can be exceptionally loyal customers.  90% of moms will stay with the same brand if the product meets their expectations and 92% will purchase the same products and brands for both home and office.”

SocialMom

A new study by Nielsen and NM Incite, “Women of Tomorrow” highlights the growing influence of women on purchasing decisions and their behavior on social media. This study includes insights on “social moms” (defined as females with at least one child who actively participate in social networking) and provides additional intelligence on how social moms shop online. I have tried to summarize some of the key learning from the study, I hope you find them useful:

50% of Social Moms Access Information via Mobile
The social mom is highly active in accessing social networks via mobile devices. Fifty percent of all moms actively participating in social media access platforms via mobile devices, in comparison to 39 percent of females overall, and 37 percent of the overall population in general.

Social Moms are Cost-Conscious and Like Couponing
56 percent of social moms are more likely to download coupons and tend to be cost-conscious. CPG products are the #1 reason to shop online with 86 percent more likely to shop online for cosmetics than the general public, as well as skincare products (85%), hair care goods (74%) and fragrances (68%).

Social Moms Frequently Offer Opinions on Brands:
Moms who actively participate in social media are 81 percent more likely to become a fan of or follow a brand online, 86 percent more likely to post a status update, and 84 percent more likely to comment or post content than the general population. The Nielsen study also shows that social moms definitely aren’t shy in sharing their advice and reviews of products with others. This segment is 85 percent more likely than the general population to share frequent advice about beauty and cosmetic products, 28 percent more likely to provide frequent advice about online shopping/e-commerce and 6% more likely to post a product review online.

Download the Nielsen report on “Women of Tomorrow” here.

CRT/tanaka has several food and consumer clients (BISSELL, Florida Sweet Corn, Canada Maple Syrup, Avocados from Mexico, the Blueberry Council) that specifically market to moms. We typically partner with online communities like Mom Central, BabyCenter and BlogHer that have a deeper understanding of the challenges and opportunities to get our message across to moms. We have seen some great results in generating awareness through product reviews, increasing online mentions for our clients via Twitter and Facebook live chats and targeted email campaigns by partnering with them.

So if you are in the business of marketing to moms, a good understanding of how they engage online and what’s their preferred mode of online communication can help us define our content strategy. Looking at the stats below, I am thinking MOBILE might be a critical component of the digital strategy to reach moms:

  • Moms spend twice the amount of time online: 66 hours per month vs. 33% for the general population
  • 80% use social media regularly vs. 55%
  • 65% own smartphones, vs. 47%
  • 23% shop via smartphone, vs. 15%
  • 8% stream video to their phones, vs. 4%

Source: 2012 American Media Mom survey released by BabyCenter.

Share any additional insights you might have on how to engage with moms online, we would love to hear from you! Happy Mother’s Day!

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Marketing 101 with Mint Juleps and the #KYDerby

THE BOOZE BIN

By Emily Valentine (@ebvalentine)

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This weekend, horse-lovers, sports fans and socialites around the world will gather to watch the 138th running of the Kentucky Derby. Which horse will win is anybody’s bet, but one thing is for certain – a massive number of mint juleps will be consumed.

The mint julep has been a Derby Day icon for as long as anyone can remember, and while this connection may seem natural, a quick look at the drink’s history shows how it has been folded into the Kentucky Derby brand through a series of strategic marketing moves.

Take a Hint From Your Customers

Legend holds that, in the late 1930s, Churchill Downs track managers caught some of the race’s most fashionable attendees stealing mint julep glasses from behind the bar. What happened next isn’t documented, but apparently someone was smart enough to recognize the marketing opportunity staring him in the face, and (cha-ching!) the rest is history.

In 1939, Churchill Downs began selling mint juleps in branded glasses that attendees could take home with them. And, to this day, tens of thousands of people leave the Derby each year with julep glasses as race-day souvenirs.

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Mint Julep Marketing Lesson #1: Pay attention to your customers – observing their (sometimes strange) behavior will help you understand their desires and create solutions to meet their needs.

Two Brands Are Better Than One

Fifty years later, mint julep madness was still going strong … and Churchill Downs made a move to take it to the next level. In 1987, the racetrack announced Early Times as the exclusive whisky sponsor of the Derby, and designated the brand’s pre-mixed mint julep cocktail as the official drink of the weekend.

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This win-win partnership has given both well-known Kentucky companies a chance to benefit from increased exposure, and to create co-promotions that build brand equity.

At the 2009 Derby, for example, Churchill Downs and Brown Forman (parent company to Early Times) unveiled the World’s Largest Mint Julep Glass, a piece that stood 7.5 feet tall (measured at the mint spring, of course), held 206 gallons and used an elaborate pumping system to distribute thousands of Early Times mint juleps.

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Both brands also benefit from the commemorative bottles that feature artwork depicting the Derby and are released in limited numbers each year during Derby season. This year, Early Times gave consumers a chance to become the 2012 Mint Julep Bottle Artist by submitting their artwork on the Early Times website.

Mint Julep Marketing Lesson #2: Every brand can use a good ally. Seek out strategic partners that can help you achieve your marketing goals, increase your exposure and build your credibility.

Support a Pertinent Cause

In 2006, with a growing number of businesses and consumers focused on social responsibility, Churchill Downs and Brown-Forman expanded their partnership to include a cause-marketing program that speaks to the equestrian community. This will be the seventh year Derby-goers have had the opportunity to purchase extra-premium mint juleps as a way to help horses lead happier lives. The high-dollar cocktails are made with Woodford Reserve (Early Times’ sophisticated big sis) and the finest mint and sugar, served in gold-plated cups with silver straws, and sold for $1,000-$2,000 a pop to raise funds that aid retired race horses.

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This annual fundraising drive is strategic for Churchill Downs and Woodford Reserve in several ways. It allows them to:

  • Generate good will among a key customer group (horse-lovers);
  • Mitigate potential attacks from horseracing critics and animal rights activists;
  • Create positive news coverage leading up to the Derby; and
  • Position their brands as being deeply committed to the wellbeing of racehorses

Mint Julep Marketing Lesson #3: Everyone loves a brand that gives back. Programs that give consumers a glimpse of a company’s charitable side (and align with its strategic objectives) can help build brand equity and offset potential threats. 

Surprised to discover all the marketing strategy that went into making you crave that minty bourbon drink this weekend? Or did you already know there was brilliance backing the tradition? Do tell ….

 

Photo credits: SouthernFood.com AmericanHeritage1.com, Shopping Blog, Early Times, Woodford Reserve.

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For Better, For Worse – And Hopefully For Richer

By Jennifer Lucado (@Jennifer_Lucado)

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“In the spring, a young man’s fancy lightly turns to thoughts of love.” Or so Tennyson memorably tells us. 

In the twenty-first century, I’d say that a young person’s fancy turns to thoughts of holy matrimony. Or at least to the number of weddings on the calendar for the next several months.

As a young person who happens to be a public relations professional, my thoughts turn broadly to relationships, and what makes them work (or not).  Being on CRT/tanaka’s Corporate Responsibility team means continually evaluating the partnership opportunities that will bring the highest ROI to our clients, whether on the corporate or the nonprofit side. Much like a good marriage, a solid partnership can last for many years and bring great rewards to both parties. With wedding season upon us, let’s take moment to think through the foundation of a strong relationship.

Chalk picCompatibility. This should be fairly obvious, but it’s surprising how many people – or companies – don’t think it through. You see some real head-scratchers. The idea of compatibility is slightly more subjective for romantic relationships, but when it comes to identifying the best partner for your business, there must be strategic brand alignment that makes sense on both sides of the aisle. How will your partner complement and enrich the emotional experience you’ve created for your stakeholders? One of my favorite examples of a perfect match is Nike and the LIVESTRONG Foundation. Nike’s mission is “to bring inspiration and innovation to every athlete in the world,” with a note that anyone with a body is an athlete. Both brands are centered on pushing the body to discover what it can achieve and experience life to the fullest, no matter where you are in your journey or what obstacles you may face. The fit could not be better. I love one of their current collaborations, the Nike Chalkbot, which gives Tour de France supporters the opportunity to submit messages of hope and inspiration and see them written along the course to encourage the participants.

Support of Your Goals. Let’s be honest – with romantic relationships, it’s easy to get caught up in the fun and passion. But at some point, to make things work in the long term, you have to evaluate what you want out of life. Your mom wasn’t wrong: you have to have goals. Will your relationship allow you to achieve them?

AnnInc_GreenLogoIt’s no different on the professional side. At the end of the day, everything must tie back to defined corporate objectives. ANN INC, the parent company of Ann Taylor and LOFT, is in the middle of a significant campaign to minimize environmental impacts, including reducing greenhouse gas emissions by eight percent by 2015. The company has established a number of in-store/facility programs aimed at energy efficiency and waste reduction to support the campaign; a recently-announced partnership with nonprofit Good360 provides a platform for stores to donate leftover items from displays and marketing efforts through a database of more than 26,000 nonprofits. The partnership not only helps ANN INC reuse materials responsibly, it extends the company’s reach to more organizations that support women and children, aligning with the full scope of the corporate responsibility platform. Well done.

Experience. We could spend hours discussing how experience impacts a person’s relationships over the course of his or her life. It might get awkward. We’ll skip that particular line of conversation, but from a business perspective, there’s no need to hesitate. A potential partner’s previous experiences can give great insight into the value they will bring. Both parties should be able to come to the table with a solid understanding of the resources they have to offer and the resources they need. They should be prepared to discuss what has worked well in the past – and what has not. Potential challenges should be addressed up front, along with how each partner can be nimble and flexible enough to adjust as needed. And there should be processes and people in place on both sides to ensure that joint efforts are adequately supported. Is it possible that a less seasoned organization can deliver on these things? Of course. Having an experienced partner doesn’t guarantee that a relationship will be smooth sailing. It just starts you off with a more complete base of knowledge from which to draw.  

Got any words of relationship wisdom you hold particularly dear? Don’t hold back – share in a comment, Facebook post or tweet.

If you could use some (professional) relationship advice, email jlucado@crt-tanaka.com to connect with a member of CRT/tanaka’s Corporate Responsibility team.

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Is Your Presentation Putting People to Sleep?

By Priya Ramesh (@newpr)

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A couple of weeks back I had the pleasure of speaking at two PR industry events, the PR News Measurement Conference and the Mid-Atlantic Marketing Summit, both during the same week and like anyone else, I sat in the audience and ranked all the speakers from best to worst. I am sure I was being judged too and that’s perfectly fine. What caught my attention during these events is the stark similarity in presentation techniques that the “best” speakers had versus their counterparts who were a little more nervous to be on stage.

As a five year old getting ready to give my first musical performance on stage in-front of the whole school, I remember my legs trembling and my heart pacing at a 100 miles per hour. This is too much information but yes I did end up peeing on stage and my teacher had to cancel my part.  The only reason I am sharing this episode on this post is to make the point that we have all been there when the nervous energy takes over you and at that moment, you just want to get off the stage. But at some point in your life especially as a leader of your organization, you got to consciously work on honing your presentation skills in order to be taken seriously. I might be biased but an effective leader is one who is also a powerful communicator.

At CRT/tanaka, our crisis communication and media training expert, Brian Ellis has helped several Fortune 500 leaders become effective communicators and he is one of my favorite speakers at the agency. Here are a few tips that I have personally learned from Brian as well as my favorite speakers in the PR and Digital Media circles like Bonin Bough, Digital Head at Kraft Foods, Scott Monty, Chief of Social Media, Ford Motors and Johna Burke, Senior VP at BurresLuce.

Share your passion in your voice: I have seen CEO’s who bring a sense of passion and energy to their meetings and presentations. This energy and passion is ADDICTIVE, listening to passionate leaders inspires you to follow their vision. On the contrary when the leader fails to bring in a sense of energy and enthusiasm to her meetings and becomes a huge time suck to listen to, chances are your team is dreading that weekly team meeting. When Bonin Bough keynotes a conference, it doesn’t matter if its 8am or 1pm (right after that awesome lunch), the audience is PUMPED UP! Energy is addictive; use it to your advantage as a speaker.

Demonstrate subject matter expertise without giving a sales pitch through your presentations: This is specifically for the sponsors of conferences who automatically qualify to be speakers by virtue of their sponsorship dollars. I sat through an entire presentation on “Data-driven communications, what your customers are trying to tell you?” by Jay Krall, manager of Internet media research at Cision and not once did I feel like Jay was pitching us Cision. He did a brilliant job of coming across as a digital expert that has a thorough understanding of data analytics without making us feel like a Cision sales guy talking constantly about how great their technology is. More sponsors should learn from Jay Krall, the art of influencing without selling. I definitely left his session wanting to set up a call for a demo from Cision.

Talk specifics and share real world examples to make your point: I am sure you agree with me in that we have reached a little bit of a saturation point with social media topics in general. So after 101 presentations on “How to integrate social to traditional,” about 50 different books on new media, I think the audience is more interested in hearing some “real world examples” especially of what didn’t work well. I respect speakers with real world experience in getting their hands dirty with actual client work versus those that site examples from national news outlets. I am sorry, I didn’t come all the way to listen to you give me a download on the BP crisis or the use of Twitter in Egypt’s revolution, national outlets and blogs have already postmortemed those issues at length . I would rather hear your personal lessons learned from your organization or clients.

Practice what you preach about “brands should become story tellers,” what about using that technique for your presentation:  The best presenters are those that effectively use the story-telling technique during their presentation. Establishing a connection with your audience, the use of humor through a personal story or a shared experience right before kicking off your session seems to be the hallmark of great presenters. I have seen presenters speaking on the topic of “How to tell your brand’s story?” in the dullest way possible. What does that do to your credibility as a speaker? A great example of someone who has mastered this technique and always delivers a stellar presentation by engaging with her audience is Johna Burke, Senior, VP at BurrellesLuce. You can follow her @gojohnab.

Make your audience a part of your presentation: I do this all the time. I always start my presentations with a question I would like to ask and what this does is, helps those that were just about to fall asleep, wake up and pay attention to you. Even better if you ask a question that emphasizes one of your key messages for the presentation, now you got your audience involved in your key message. Their ego involvement in what you are about to say is that much higher. The “I” in “Interaction” starts with you as a speaker asking your audience to participate in a quick poll (show of hands) or challenging them to think differently.

As a communications pro, I think it’s our responsibility to groom the leaders in our organization to be an effective spokesperson or anyone who is a brand ambassador to make the best use of the time with a captive audience. Effective communication is the hallmark of strong leadership.

Shel Israel, noted social media influencer and author of “Twitterville” recently published his new book, “Stellar Presentations: an Entrepreneur’s Guide to Giving Great Talks.” It’s a must-read for anyone who spends a good chunk of her time “presenting” or as I see it “influencing through steallr presentations.”

If you or your CEO needs presentation/media training, all you have to do is email us at pramesh@crt-tanaka.com.   

 Happy Speaking!

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PR Pros, 4 tips on how to be an awesome link builder.

By Jason Poulos (@TheSaganaki)

Links back to a website are one of the most important ranking factors to a search engine. The materials, content and outreach created in the public relations world could be chock full of extremely helpful back links that could help get your clients content on page one of Google.

Are you reaching out to bloggers, websites and the media on your client’s behalf? How about creating articles, press releases and  blog posts that will get posted on websites outside of your client’s?  If you have any of these responsibilities you could be passing up valuable opportunities for your client. As a PR professional, your influence on these media outlets could be greater than what you thought.

Grasping the concepts of SEO and trying to manage your client work and stay on top of the latest PR trends can seem a little overwhelming. However, integrating some of these best practices into your workflow can create strong results for your client.

Tip 1: You need to know how a search engine works

Just the basics are necessary, if you want to help with your clients rankings some basic SEO knowledge will be very helpful. When relying on a search engine to generate traffic to a website there are two main factors to be concerned about.

  1. Relevancy: How relevant your site is to the search queries. Meaning, when I search for “Bypass Burger” where is the phrase “Bypass Burger” located on your site. For best results the term (keyword) should be in the url, page title, page description, heading tags and content.
  2. Popularity (Backlinks): How popular your website is. Search engines determine popularity by links back to your website. The quantity and quality of these backlinks influence a websites ranking.

A website that ranks well in search will be keyword rich and will have a strong backlink profile. Need more SEO tips? Check out my 15 basic SEO tips.

Tip 2: You need to care

More often than not, SEO and PR will not be found in the same agency. Typically, the client will hire two separate agencies, one for PR, the other for SEO/SEM. First off, this lack of integration has it’s own set of issues but most likely the responsibilities of generating traffic and improved search rankings will not fall into the PR bucket. So, if you’re on the PR side why should you care about how your client’s website is ranking in search? You have a myriad of responsibilities of your own, besides that’s another agencies task and not yours.

Well, you should care. What you do in the digital PR world could be full of extremely helpful backlinks that could help boost your client’s search rankings.

All in all, this boils down to caring about your clients. If you want to see them succeed and get better rankings ask them about SEO.  Even though this might be another agencies task but your client should be able to provide you with a list of specific keywords and landing pages they are trying to rank for.

Tip 3: Integrate keyword rich links

Even if you don’t care about how a search engine works or your clients this is by far the most important tip in this post. Whatever you are creating needs to have links back to your client’s website. Not just a http://www.clientsite.com at the end of the release but links throughout the article/post/release/pitch…

For instance, let’s say we are trying to rank for “bypass burgers” in Google. When that term, “bypass burger” is used in your article, link it to that specific page on your site that references that content.  So, “bypass burgers” would link to http://www.clientsite.com/bypass-burgers/ and it would look like this in your article: bypass burgers. Now, keep on doing this throughout the rest of the article, integrate the supplied keywords into your content and hyperlink them out to the proper pages on your client’s website. Easy, right?

Having these keywords integrated into the article and then linking out to that content is a must. Search engines love links like this as it signals to them the specificity of the content at hand.

Tip 4: Ask for back links

This tip is also found in my 5 SEO tips for PR Pros article but it fits here too. If you catch wind of coverage that you didn’t pitch, go back and ask the author to include a link back to your site if their isn’t already one. Super simple yet effective way to grow a back link profile.

Oh, and why do I keep on mentioning bypass burgers? Because I just read this article on Heart Attack Grill, and it’s pretty crazy! I kind of want to try one too….

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What’s Old is New Again

clip_image002Last weekend, while getting dressed like an extra from the Broadway show Newsies for a 20’s-themed surprise party at the Manhattan club Prohibition, my thoughts drifted to the resurgence of trends and nostalgia for times past. Bell bottoms, leg warmers and moon boots have all had their questionable rises and returns to cultural popularity. Food generally follows a different path. While it isn’t removed from fads or trends, there seems to be more of an evolution that continually moves forward balanced with centuries old traditions.

Molecular gastronomy pushes the boundaries of techniques and challenges basic ideas of food that we take for granted, but we are also seeing a return to traditional methods from homemade pasta to home cured meats. The Oldways Preservation Trust is passionate about preserving food’s past in the face of advancement. It grew out of a concern over the diminishing health of our population and a belief that it was related to the growing chasm between our modern food supply and its heritage, which was slipping away.

Return of the Artisan—It used to be you could spot an authentic Italian restaurant if they made their own pasta. Now, pizzerias are making clip_image004their own mozzarella in-house, and chefs are curing their own meats. Big brands are already trying to tap into this trend with the Dominos line of Artisan Pizzas and Tostitos Artisan Recipe chips. The higher prices of artisan products have stalled growth in recent years, but gourmet specialty foods continue to gain popularity. We should all be careful of consumer fatigue with the word and skepticism as it proliferates across product line extensions of big brands. However, I don’t see any slowdown of an increasingly educated populace about the food they eat and where it comes from. Technology is lifting back the veil and making this information more easily accessible than ever before. Artisan products have a story to tell, and ironically, it is new technology that is helping them tell it.

Classic Cultural Flavors—Curry from India, mole from Mexico and kimchi from Korea all have a few things in common. They are incredibly flavorful, ubiquitous in the cuisine of its native country, and they take a long time to make. Perhaps that is why they have been slower to capture the American palate, but as traditional flavors are adjusted and convenient bases are developed, they will fit in nicely to the growing market for bold, flavorful foods. We are seeing kimchi proliferate in expanded permutations across menus. As we delve deeper into regionality of global cuisines we will discover more nuanced variations of these flavors.

Lost Foods Rediscovered—I’m not referring to that M&M tucked down in the couch, but rather quinoa and other “ancient grains” that have seen a rebirth in recent years and have broken out of natural food stores into supermarkets and manufactured foods. The term “ancient grains” (spelt, farro, Kamut) has been popular to describe these foods, especially by food manufacturers. It denotes a certain authenticity to them and is easier to pronounce. Though some are not truly grains they can get lumped together for simplicity. Manufacturers of breads, crackers and cereal bars are riding this wave of “Ancient Grains” and like with terms such as “Artisan” and “Natural” the lack of definition and overuse by aggressive marketers will lead to fatigue in consumers’ minds.

With food there is a stronger desire to look to continue traditions. Fashion is all about the next seasonal line or new designer while food has a past that it is reluctant to let go. While there is always innovation and momentary fads, there is a sense of cultural and family history in which it will always be rooted. For food marketers it is important to balance trends with the past, but as my colleague Roasalie wrote yesterday about Trader Joe’s, it is always better to set the trends…especially if they have a few thousand years of staying power.

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The Power of Voice: Why Radio Thrives

By Debbie Myers

Radio is the most fascinating communications medium.  It continues to thrive despite many attempts to derail it. At one time, television was thought to replace this medium of the mind, but radio reinvented itself with DJ personalities and drive-time news and weather. Then satellite and Internet came along and radio has adapted once again – growing with more program offerings such as Doctor Radio on Sirius XM and Blog Talk Radio.

Why is radio so enduring? Well, it’s versatile, easy to access and has a low cost to produce. In communities, local radio brings people together with live remotes and traffic reports. Above all, radio allows people to converse, no matter who they are or what their educational level. And with radio, you can reach people who want to hear from you.

This week I became even more sold on the power of radio when I had the opportunity to host a program for our client, the American Physical Therapy Association. APTA tapped into Blog Talk Radio to create Move Forward Radio, a terrific program to promote physical therapy. More importantly, it’s a unique and fun way to have experts talk directly with people who need their advice.

Blog Talk Radio exploits what’s best about radio – its ease of use. With a phone and the Internet, anyone can create their own show. Of course, people don’t want to listen to just anyone, and that’s where a little expertise comes in. This week, APTA selected a great topic that appealed to a wide variety of people – low back pain. They supported the topic with a survey that showed that 61 percent of Americans said they have experienced low back pain, and of those, nearly 70 percent felt it has affected their daily lives, such as their ability to exercise, to sleep, to work, or to have intimate relationships.

Combine the topic with interesting guest experts like Mary Ann Wilmarth, DPT and Chief of Physical Therapy at Harvard University Health Services; Mike Ryan, Physical Therapist and Head Athletic Trainer for the Jacksonville Jaguars; and Colette Morgan, M.D. at Emory University and volunteer with AARP Georgia, and our Move Forward Radio segment was able to hold people’s attention. (Listen for yourself.) But, promoting the program through social medial media channels before and during the program drove people to tune-in.  While a sizable number of people listened to the show live, the number of people who listened to the recorded program throughout the evening grew by nearly 25 percent. Unlike conventional radio, Blog Talk Radio lives online, allowing a multitude of people to tune in at their convenience.

Visuals are powerful, but nothing will replace the connectivity of sound. In one form or another, radio will live forever.

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3 Marketing Tips from Trader Joe’s: A Brand Built on Booze

THE BOOZE BIN

By Rosalie Morton (@rosaliemo)

As a Pasadena, Calif. native, I have a special place in my heart for Trader Joe’s. The very first store is only a few miles from my house.  I love the “crew” with their Hawaiian shirts, the friendly neighborhood atmosphere, the sample stations, the amazing pre-packaged salads, the innovative private-label selection, and most of all the low prices and phenomenal wine and beer section. I mean, Trader Joe’s invented the reusable “Save-A-Tree” bag back in 1977. What’s not to love?

And, America loves Trader Joe’s. Its stores sell an estimated $1,750 in merchandise per squareOriginal Pasadena Store foot, double that of Whole Foods. The story gets better… this ridiculously successful, kid-friendly neighborhood market with a cult following was a brand built on booze.

Here are three marketing lessons we can learn from Joe Coulombe, the founder of Trader Joe’s, who created one of the most well-loved markets in America:

Choose a specific audience (and choose wisely) who has a need: Joe Coulombe opened the first Trader Joe’s store to serve overeducated and underpaid population of Pasadena – the journalists, teachers, museum curators and musicians. He chose this group because their influence is disproportionate to their salaries, and they love to share their discoveries with their friends of the same strata. Furthermore, Coulombe noted a strong correlation between alcohol consumption and education level.

Trader Joe's SignHe understood that these folks liked to get their drink on, appreciated quality alcohol, but couldn’t afford the really expensive stuff. So, if he provided them with good alcohol at a good price, he knew that not only would they buy it… they would tell their friends to buy it too.

Build loyalty by addressing that need better than ANYONE else: Coulombe stocked the first store with 70 bourbons and 100 scotches. In the 1960s, Trader Joe’s literally sold every California wine available. Coulombe bet on the booze and he bet on value. He set out to prove that you could buy a decent bottle of wine for less than $10, and he built his empire on this notion.

He also secured an old license that leveraged a loophole in the fair trade laws. This license enabled him to act as a wholesaler and develop a private label, which was actually the precursor to the infamous Charles Shaw wine  a.k.a. Two Buck Chuck.

Create a sense of urgency and never stop innovating: Once he conquered booze, Coulombe also knew this educated crowd had sophisticated and experimental palates. Trader Joe’s has an urgency to understand what their shoppers want even before they do. The company doesn’t follow trends — it creates them — from Mochi Ice Cream, to Kettle Corn, to Quinoa. According to a Fortune article, a former senior executive revealed that TJ’s biggest research and development expense is travel to find these taste-making foods. It’s through this sense of urgency and dedication to innovation that the company continues to captivate its audience.

By golly, it worked. Today, Trader Joe’s is known not only for its value wine selection, “makeVintage Ale your own six pack” loose craft beers and house-brand spirits (Vodka of the Gods, anyone?), but also its incredible top quality, low cost, house-label, limited run food. True TJ’s devotees can tell you their favorite TJ’s product that only comes once a year. For me, it’s the Candy Cane Green Tea at Christmas.

Nearly 50 years since the first store opened, the word-of-mouth continues as well, but now it’s amplified by an army of social media-savvy TJ’s addicts. In fact, Trader Joe’s wine section has inspired a series of spin-off blogs, TJ’s Wine Notes, Trader Joe’s Wine Compendium, and TJ’s Wine List to name a few.

So wave your Fearless Flyer and raise a glass of Two Buck Chuck to Joe Coulombe to thank him for a remarkable lesson in Marketing 101 and for bringing us Trader Joe’s.

Annnd… I’ll keep driving 20 minutes to the TJs in Short Pump to do my grocery shopping.

Source: Gayot; Forbes; Wikipedia; Los Angeles Magazine

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Sustainability is Good Business

sustainability

By Mike Mulvihill

 

Corporate Social Responsibility or Sustainability programs require investment and oversight. They cost money. So a reasonable question to ask is, “Do companies engaged in sustainability programs financially underperform companies that are not engaged in sustainability programs?”

The answer is a resounding NO according to a new Harvard Business School paper, The Impact of a Corporate Culture of Sustainability on Corporate Behavior and Performance. The paper’s authors tracked the performance of 180 companies between 1993 and 2010. Half of the companies were identified as High Sustainability companies and the other half (traditional companies with no focused Corporate Responsibility Program) were labeled as Low Sustainability. The study found that:

  • A $1 invested in a portfolio of these High Sustainability companies in the beginning of 1993 would have grown to $22.60 by the end of 2010. While a $1 invested in a comparable portfolio of Low Sustainability companies grew to just $15.40. In addition, the High Sustainability group exhibited lower stock price volatility during this time period.
  • From an operating performance standpoint, a $1 of High Sustainability company assets at the beginning of 1993 grew to $7.10 by the end of 2010. Meanwhile, $1 of assets in the Low Sustainability companies grew to $4.40.

The study found some common characteristics among the High Sustainability group that are noteworthy and worth emulating:

  • Their boards were directly involved in sustainability issues and executive compensation is linked to sustainability objectives
  • External communications focuses on longer time horizon issues, which creates deeper stakeholder engagement and more long-term focus investors
  • Their workforce is more engaged due to greater attention to nonfinancial measures
  • There is greater focus on setting and monitoring environmental and social performance metrics for suppliers
  • And there is a higher level of transparency in disclosing nonfinancial information

Sustainable firms are not adopting environmental and social policies solely for public relations reasons (although doing well by doing good does make for successful public relations efforts). Rather, these policies reflect substantive changes in a company’s business processes. Like Siemens generating €20 billion in 2010 revenues from its environmental portfolio. Or, Dow Chemical, which set its first 10-year sustainability goals in 1996 starting with a focus on energy efficiency leading to savings of almost $5 billion due to energy efficiency. And Philips, where product innovation based on its environmental commitments has led to energy efficient light bulbs and solar power successes.

Another reasonable question to ask is if companies with better financial performance are simply more likely to engage in sustainability programs, thereby making the study’s outcome a self-fulfilling prophecy. While that topic may be worthy of greater discussion, the study did find that both High and Low Sustainability company groups had very similar financial performance in the early 1990s. It is certainly a valid assumption that more profitable companies have more resources to invest in seemingly “non-core” business practices. Conversely, it is difficult for a marginally profitable business to find time or money to invest in much beyond their immediate survival.

But this study is evidence that sustainability practices are core to more successful business operations and financial performance. Sustainability leads to more loyal, satisfied customers, more engaged employees, greater innovation, higher profits and an increased stock price. What company wouldn’t want more of all of this?

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From Rap Lyrics to Burlesque Shows – How Beverage Brands Win with Celebrity Partners

By Emily Valentine (@ebvalentine)

Brands and celebrities have long led a symbiotic existence. Whether through paid endorsements or acts of serendipity, stars throughout the years have proven their trendsetting power by driving product sales and putting unknown brands on the map. Consequently, for as long as the concept of brand (or corporate image) has existed, marketers have actively recruited movie stars, athletes, musicians and other pop culture icons to serve as brand ambassadors.

Celebrity endorsements

The alcohol industry has never been one to ignore opportunities from Hemingway and Havana Club rum to P. Diddy and Ciroc, we see countless instances of celebrities and booze brands profiting from one another. Here are a few of the celebrity branding patterns I’ve observed as a marketer, and a few noteworthy examples from the beverage industry:

Paid Endorsements and Co-Branding

How it works: Beverage company wants to revive its image, reach a new demographic or simply grow brand awareness. Company approaches celebrity with a proposal, formal contract and fee schedule … negotiations follow. Eventually, arrangements are made for a series of endorsements via advertising, film, events, media interviews, social media channels and so on.

What it looks like: These types of partnerships are brokered by beverage brands all the time, from Bette Davis and Jim Beam to Kate Beckinsale and Absolut Vodka. One recent example worth exploring is that of French spirit brand Cointreau and burlesque star Dita Von Teese. This strategic alliance has matched two complementary personalities to create alluring co-branded programs that increase exposure for both parties. Thus far, the collaboration has encompassed a “Be Cointreauversial” burlesque tour, which evoked “the Cointreau world” with performances by Dita in cities across the globe; co-branded cocktails including the Cointreau Teese and Cointreau MargaDita; a Travel Essentials promotion with Morgans Hotel Group; and, a pop-up speakeasy in London. And, as a wise colleague recently observed, Dita’s strategic exposure has been instrumental in putting Cointreau back on the map.

Burlesque Star Dita Von Teese As a Cointreau Brand Ambassador

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Organic Endorsements

How it works: Celebrity is so fond of beverage brand, he/she mentions it unprompted in an interview or song lyrics or the like. Brand benefits from organic exposure and increased name recognition, awareness and appeal. Sometimes, brand then approaches celeb to discuss further paid endorsements.

What it looks like: Hennessy Cognac and hip-hop culture offer a perfect example of this phenomenon. Bizarre as the connection may be, the French spirit brand’s popularity among younger generations has grown in the last 15 years, and it has rap stars to thank.

Mac Dre was evidently the first to reveal his love of Hennessy through song lyrics and, since then, such artists as 2Pac, Nas, Dr. Dre, Snoop Dogg and Eminem have referenced it in all sorts of *lovely* ways (*note the sarcasm).

Freekey Zekey says, when in doubt, “Blame it on the Henny”

Hennessy’s response to this cultural preference has included sponsoring hip-hop events and establishing Hennessy Artistry, an annual concert series curated and headlined by hip-hop artists and entrepreneurs. In 2010, Hennessy introduced its first new blend since 1961 – Hennessy Black. Designed to be mixed rather than savored, and associated with “high energy” drinking occasions like dance parties in urban nightclubs, Hennessy Black is well-positioned to reach its new target customers.

           Hennessy Before                         Hennessy After

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See the UGG story for another example of organic product endorsement leading to brand success.

Brand Extensions

How it works: Celeb rises to fame in the film, music or sports industry and later begins to explore new projects using his/her acquired resources. Upon discovering an area of opportunity (or realizing a new passion), said celeb applies his/her personal brand to create and market a new product.

What it looks like: Just as successful corporations leverage brand equity to extend their business into new realms, celebrities often apply the strength of their personal brands to explore new endeavors. In the spirits space, we see examples of this with Danny Devito’s limoncello, Dan Aykroyd’s vodka and Justin Timberlake’s tequila; in the beer world, there’s Kid Rock’s Badass American Lager and the Hanson brothers’ forthcoming MmmmHop IPA. There are also dozens of celebs who own wineries (Boz Scaggs, Mario Andretti, Sam Neill and more) and/or take pride in making their own wine blends (Joe Montana, Lil John, Carlos Santana, etc.).

One of the few celebrity-made wines I’ve actually tasted is that of musician Dave Mathews, who, in my opinion, sets an admirable example for celebs seeking to blend business with passion and goodwill. In 2000, Mathews partnered with his brother, Peter, and longtime friend Brad McCarthy to establish Blenheim, a small winery in Charlottesville, Va. Dave provided the resources and creative vision while Peter tended the vines and Brad made the wines. Since then, Blenheim has come to produce quality wines well-respected by wine critics as well as local wine drinkers and restaurateurs. The winery’s green architecture and sustainable farm practices show its owner’s respect for the environment and surrounding communities, and its low-profile marketing philosophy is just what you’d expect from Mathews, who tends to shun the limelight.

Dave Mathews’ Sketch of Blenheim Winery

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With a fruitful Virginia wine venture under his belt, Mathews recently launched Dreaming Tree Wines, a California-based collaboration that, so far, exhibits many of the same branding principles that have defined Blenheim’s success. I expect the remaining chapters of the Dave Mathews wine story will be anything but boring, so keep an eye on these two brands in the coming years.

Dave’s Brand Extends to Dreaming Tree Wines

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If celebrity product endorsements are the oldest trick in the book, then celebrity brand extensions are the newest. Either strategy can flop if ill-conceived or poorly executed, but, as the above examples show, a well thought-out campaign that aligns your brand with the image, culture or worldview of an influential public figure can also yield great advantages in terms of awareness, appeal and relevance.

What celebrity beverage branding trends have you observed lately? Share them in the comments section below.

Photo credits: Cointreau, Rap Godfathers, Hennessy, Blenheim, Dreaming Tree.

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