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Meghan's Mom

A journey of life, love, and loss

Are Your Objectives SMART?

As a marketer, a lot of time is spent on identifying the objectives of any given campaign, and the marketing strategy overall. Setting these objectives gives everyone involved a focused framework in which to operate; the whole team knows what the target is, and can work together to get there. Setting these objectives can seem like a big job, but in fact it is fairly simple when we keep the SMART mnemonic in mind.

  • Specific: Does the objective contain enough detail to measure problems and opportunities in the real-world? Is the objective clear?
  • Measurable: How will the team know when the objective has been met? When do we stop measuring? Can a quantitative (or qualitative) characteristic be identified to develop a metric?
  • Actionable: Will this objective help improve performance, eliminate a challenge, or increase revenue? If not, why are we doing it?
  • Relevant: Does the campaign goal fit into the overarching goals of the marketing strategy? Into the overall business goals? Do the objectives address a specific problem or opportunity?
  • Time-bound: When is the deadline? When will we know if the campaign was successful?

When identifying SMART objectives for business, many factors must be considered: the objectives for a particular campaign; the overall business goals and objectives and the company’s mission and values; and any legal and/or ethical challenges. And while we’re at it, we also have to make sure we are measuring the data that really matter and not just what’s flashy or exciting, such as fan and follower numbers on social media.

It sounds rather impossible, but it doesn’t have to be.

Let’s assume for the sake of this blog that we are marketers for a family-owned jewelry company called Jones Jewelry. The owners are ready to retire and pass the reins to their adult son (Sam) and daughter (Amanda), who will have complete freedom to run the company the way they wish. Sam and Amanda fought tooth and nail to convince their parents to build a website for the company, but they have had little luck persuading them to enter the world of digital marketing and social media. Now that they will be in charge, though, they are sitting down with us to develop a digital/social media marketing campaign to launch Jones Jewelry into the 21st century.

jones jewelry

The overall goal of the business is to provide outstanding quality in both stones and settings while being an active member of the local community. The Joneses have spent decades building quality relationships with the town in which they operate, and they take a great deal of pride in the fact that they know most of the other business owners in town, and that they play such an important part in the lives of their clients. In fact, they have customers who have bought jewelry for engagements, weddings, new baby presents, graduations, and even funerals, representing a lifetime of moments both big and small in the lives of their customers. Sam and Amanda have no desire to change their family’s reputation or business model of developing real and lasting relationships with the public. They just want their name to reach a little further than the three-county region in which they have always existed. They are also planning to add e-commerce to the new website, so that people can shop online.

We have identified the platforms we want to build a presence on – Facebook, Twitter, and Pinterest. We’re also considering a LinkedIn account for business contacts, like gemstone buyers and sellers. Our initial goals might look something like this:

  • Obtain 150 Facebook followers within three months.
  • Drive 20% more traffic to the website by Q3.
  • Follow and interact with ten new Twitter accounts each week for two months.
  • Receive at least 15 RTs (retweets) or @mentions a week within 3 months.
  • Increase website and in-store sales by 20% within 18 months.

All of these goals are very specific, measurable in a way that will allow for the development of a KPI (key performance indicator) that will help us keep track of our progress toward the goal, attainable, relevant to the overall goals of the business, and we have attached a deadline to each objective, so they are time-bound.

Legal and ethical implications of our SMART objectives must also be considered. We will have to make sure that the images we use on our website and social media platforms are all images of our actual products so that we meet truth in advertising requirements set forth by the Federal Trade Commission. We will also have to make sure that our content and advertising tactics are above-board, friendly, and not used to manipulate consumers in any way.

I Know My Target Market is Out There Somewhere…

One of the most challenging aspects of launching a new product or service can be determining who to market it to. Market targeting does not mean that the brand wishes to exclude any one consumer or type of consumer; rather, it means defining the specific market that will be most impacted by the bulk of the company’s marketing budget. An example of this might be a landscaping company that markets to homeowners between the ages of 30 and 55 with incomes of $80,000 in the suburbs of Atlanta, Georgia. To break the market down even further, the landscaper could choose to focus only on those interested in designing functional outdoor living areas for entertaining and relaxation.

To drill down to this level of specificity, the marketer’s best bet is to use tools designed for this purpose, such as Claritas’ MyBestSegments PRIZM® tool and VALS™. Both of these frameworks segment American adults into various groups or types, using demographics, geographics, and psychographics to help explain the composition of the group. Marketers can use these tools to find out where and how their ideal customer lives, works, and plays so that they can create effective marketing content for them.

PRIZM

The PRIZM tool defines every American household in terms of 66 distinct segments to help marketers discover consumers’ likes, dislikes, lifestyles, and purchase behaviors. It provides a “common language” for marketing and is used by thousands of marketing professionals in Fortune 500 companies (“Claritas PRIZM,” 2017). The segments are grouped into 11 Lifestage Groups and 14 Social Groups, and take into account traits like income, education, occupation, and home value. In my neighborhood just twenty minutes west of Atlanta, the most common segments are:

prizm 30168

Of these, the groups my landscaping example would focus on are 30 Pools and Patios and 33 Second City Startups. They would be the most likely to want to install outdoor living areas for relaxation and entertainment purposes. The tool also breaks down population by age, race & ethnicity, household income, and household composition within a specific zip code, to help the marketer decide whether a particular area is a good fit for his product or service.

VALS

VALS™ segments US adults into eight distinct types using psychological traits and key demographics that have been proven to drive consumer behavior. The eight types are Innovators, Thinkers, Believers, Achievers, Strivers, Experiencers, Makers, and Survivors. They are arranged using the US Framework, which illustrates the VALS types in reference to their primary motivations and resources:

vals

To find out which VALS type you fall into, take the US VALS Survey. It sorts the survey taker into a primary type – that which you are most like – and a secondary type – the group you are next most like. Generally speaking, a person’s primary VALS type represents her dominant approach to life, while the secondary type represents a particular emphasis on the dominant approach. To illustrate, I was sorted into the primary type of Innovators and the secondary type of Experiencers.

vals types

As it happens, for the purposes of our landscaper, these are probably the two types he would most want to market his outdoor-living areas to.

Beyond using specific tools like PRIZM and VALS, here are a few tips to help you define your target market:

  • Examine current customer base
  • Check out the competition
  • Analyze your product or service to clearly identify benefits and features
  • Choose specific demographics to target. Think about age, location, gender, income level, education level, marital or family status, occupation, and ethnic background
  • Consider psychographics: personality, attitudes, values, hobbies and interests, lifestyle, and behavior
  • Evaluate your decision. Are there enough people in your target market? Will they see a need for your product/service? Do you understand what motivates your target market? Can they afford your product/service? Are they easily accessible to hear your messaging?

The amount of time a marketer spends defining the target market is proportional to the amount of success he will enjoy with his marketing efforts to those groups.

Using the PRIZM tool, which groups in your neighborhood would be calling up our fictional landscaper for a backyard overhaul? Which VALS type are you, and how do you think that affects how marketers speak to you?

References

“US Framework and VALS™ Types.” (n.d.). Retrieved May 27, 2017, from http://www.strategicbusinessinsights.com/vals/ustypes.shtml

“Zip Code Look-Up.” (2017). Retrieved May 27, 2017, from https://segmentationsolutions.nielsen.com/mybestsegments/Default.jsp?ID=20&pageName=ZIP%2BCode%2BLookup&menuOption=ziplookup

 

How Important is Corporate Social Responsibility?

Ben & Jerry’s, the makers of my all-time favorite ice cream, Phish Food, have a strong commitment to corporate social responsibility (CSR) that stems back to the 1980s, before CSR was cool. Co-founders Ben Cohen and Jerry Greenfield had a three-part mission statement: to make the world’s best ice cream, to run a financially successful company, and to “make the world a better place” (Gelles, 2015). In the late 80s and early 90s, the company was among the first to adopt progressive management tactics that we now take for granted, such as offering benefits to employees’ same-sex partners. Ben & Jerry’s also financed a campaign against bovine growth hormone that ultimately saved an untold number of family farms. When Unilever started negotiating with Cohen and Greenfield to buy the company, many feared that the concept of linked prosperity – the idea that businesses could pursue a double bottom line that balances profit and the people who make it possible – that the two believed in so strongly would be swallowed up whole in the takeover.

Right off the bat, those fears seemed to be proven true – a production plant and distribution center were closed with all workers laid off, sales representatives at the company’s headquarters were fired, and the company had to deal with protests against the company by current and former employees. It was a steep learning curve for both Unilever and Ben & Jerry’s, but now, nearly 20 years later, the company’s commitment to the original mission is stronger than ever. Revenue has nearly tripled since the takeover and the company has added hundreds of jobs. Part of that is because of the protections Cohen wrote into the takeover agreement with Unilever; an external board was created to oversee the company’s culture and social missions, and it does not report to any entity other than itself, in perpetuity (Edmondson, 2014). Some of the programs that the company has implemented include:

  • More commitments to local farmers for fresh, local ingredients.
  • A push for national labeling of genetically modified organisms (GMOs).
  • Ambitious goals to reduce energy consumption and waste.
  • Above-average compensation for employees – the company’s lowest-paid workers earn more than twice the national minimum wage.
  • Using only cage-free eggs.
  • B Corporation status, which is a voluntary certification by a nonprofit called B Lab. The nonprofit designates companies that uphold high social and environmental standards.

bnj tweet climate change

The company even incorporated its social and environmental stance in a relatively new flavor called Save Our Swirled, intended to raise awareness around climate change by depicting cows on top of melting icebergs on the label.  The company encourages its customers to talk to their local governmental leaders about clean energy options. Ben & Jerry’s as a company also supports marriage equality and campaign finance reform (“Our Values,” 2017).

save our swirled

If there is a sour note for Ben & Jerry’s, it is on-going concerns over the treatment of migrant farm workers. The company has continued to deal with protests by Vermont dairy farm workers who are demanding that the company require the farms to observe a code of conduct that would guarantee the workers a weekly day off, seven vacation days a year, improved housing, and more. Arnulfo Ramirez, a dairy worker from Guatemala, said during one protest, “The majority of us farmworkers, we don’t even have a day off” (Greenhouse, 2015). Migrant Justice, the group behind the protests, is looking to Ben & Jerry’s to help other companies that use dairy farms to adopt its “Milk With Dignity” campaign. In 2015, the company signed an agreement with Migrant Justice, pledging to develop a detailed code of conduct. “Our whole mission and value system,” said Rob Michalak, Ben & Jerry’s global director of social mission, “it’s to ensure people in our supply chain have a dignified life.” Michalak continued to say that the company had already implemented some aspects of the Milk With Dignity program.

My feeling is that the company is “green” for its environment just as much as it is “green” for profit. It seems like Cohen and Greenfield’s CSR vision for Ben & Jerry’s, while changed and perhaps not exactly what they originally planned, is still very much alive. Ben & Jerry’s parent company, huge conglomerate Unilever, has even discussed trying to achieve B Corporation status through B Lab, though it admits it would not be feasible at this point in time. But at least they’re thinking about it.

What companies do you love for their commitment to social responsibility or activism? And more importantly, what’s your favorite Ben & Jerry’s Ice Cream flavor? Sound off in comments!

References

Edmondson, B. (2014, March 18). How Ben & Jerry’s brought maverick ideas to mainstream business. Retrieved April 22, 2017, from https://www.theguardian.com/sustainable-business/ben-jerrys-maverick-ideas-mainstream-business-values

Gelles, D. (2015, August 21). How the Social Mission of Ben & Jerry’s Survived Being Gobbled Up. Retrieved April 22, 2017, from https://www.nytimes.com/2015/08/23/business/how-ben-jerrys-social-mission-survived-being-gobbled-up.html?_r=0

Greenhouse, S. (2015, July 3). Farm Labor Groups Make Progress on Wages and Working Conditions. Retrieved April 22, 2017, from https://www.nytimes.com/2015/07/04/business/economy/farm-labor-groups-make-progress-on-wages-and-working-conditions.html

“Our Values.” (2017). Retrieved April 22, 2017, from http://www.benjerry.com/values

Marvel vs. DC Comics: Which One is the Underdog?

Since comic books began, the rivalry between Marvel Comics and DC Comics has been going strong. Now, in the era of multi-million dollar summer blockbusters featuring the iconic characters, the stakes are much higher. Both companies have been purchased by major competitors in the television and movie business – Marvel was purchased by Disney in 2010 for $4 billion, while DC was purchased by Time Warner in 2009 and then was later absorbed into the deal AT&T made to purchase Time Warner in 2016 for $80 billion. Clearly, both players in the bringing-comic-book-characters-to-life game are backed by money and expertise. So, who’s winning?

Brand Strategy

 The brand strategy used by both companies is the same, or nearly so, at least on the surface. Both create blockbuster movies based on comic book characters that the audience knows and loves. Both have television show tie-ins that give viewers both the excitement of the big screen action and the week-to-week suspense of the small screen adventures. However, Marvel is much more prolific, at least on the big screen, and their television show tie-ins, most notably Marvel: Agents of S.H.I.E.L.D., strive for some consistency between the happenings in the movies and the plotlines of the weekly show. With franchises like Iron Man, The Avengers, and Guardians of the Galaxy, Marvel has shown a willingness to both stay true to the comic book history for the characters, while also breathing new life into them with exciting storytelling.

Three ways Marvel has broken the marketing mold in movies are:

  • Organic product placement. In some cases, the story and the characters make it too easy: take Tony Stark’s obsession with luxury cars, for example. Audi leveraged an organic connection in The Avengers: Age of Ultron by putting Robert Downey, Jr.’s character Tony Stark behind the wheel of one of its line of luxury vehicles, and it felt completely natural to the viewer.
  • Using brand history to create current stories. Marvel first launched Fantastic Four 54 years ago, and today the brand’s iconic characters like Spiderman and Wolverine are pop culture mainstays. Marvel Studios understands this, and has worked hard to develop fresh content that will appeal to new viewers while also staying true to the roots and origin stories to appease long-time comic book fans. Bringing more obscure, less mainstream-friendly characters to the forefront has also proven to be a good look for Marvel – Guardians of the Galaxy and Deadpool are testaments to that marketing move.
  • Serial storytelling. This goes back to Marvel’s movie/television crossover we discussed earlier; the Marvel Cinematic Universe is a living, breathing, and fluid thing, and the connections keep the viewer interested between seasons of the television show or year-long waits for the next movie. Viewers who follow both the movie and television aspects of the MCU are rewarded with a heightened sense of engagement, while viewers of only one or the other still have a fully entertaining experience, too (Simpson, 2015).

Where Marvel excels is the consistency between its movie and television offerings. Meanwhile, DC Comics has publicly stated that their television and film universes are unconnected, leaving newer fans feeling disconnected and confused and making long-time DC lovers angry by the differing origin stories and plotlines across the universe.  If there were one thing DC could do to improve its marketing strategy, it would be to tighten up that consistency and create a fluid big screen to small screen experience for its audience, the way Marvel has done. Any marketing campaign should take into consideration how the audience will feel about the message, and should also work to ensure that the message is delivered clearly and with the same vision, no matter what the medium (Gardiner, 2015).

Though my nature is usually to identify with and support the underdog, in this rivalry I definitely come out on top for Marvel, which I believe to be the “top dog.” While both companies have enthusiastic and loyal fans, I think the box office earnings and market share enjoyed by Marvel shows pretty clearly that consumers prefer Marvel over DC, too.

infographic-marvel-vs-dc-lowdown-on-the-showdown-1-638.jpg

 

References

Gardiner, H. (2015, February 19). Content Marketing Lessons From Marvel & DC Comics. Retrieved April 8, 2017, from https://www.koozai.com/blog/content-marketing-seo/content-marketing-lessons-marvel-dc-comics/

Simpson, P. (2015, April 21). 3 Things Marketers Can Learn From Marvel. Retrieved April 8, 2017, from http://www.dmnews.com/content-marketing/3-things-marketers-can-learn-from-marvel/article/410091/

Market Segmentation Strategies

Market segmentation is practiced by all companies, in one way or another. It is a way for a company to take its broadest audience down to specific groups, allowing the brand to offer these groups benefits of its product or services where they are most needed or desired. When implementing these strategies, it is important that companies remember that market segments should be:

  1. Measurable, either by value or volume. A good marketer should be able to identify the size of a market segment within a “reasonable degree of accuracy,” so that the cost of marketing to that segment can be evaluated in terms of return on investment (Lannuzzi, 2014).
  2. Substantial. If the market segment a brand defines isn’t large enough, or doesn’t command enough buying power, there is little point in expending the time, effort, and money required to market to it.
  3. Accessible. Different segments will respond to different strategies, but the brand has to be able to reach the segment in the first place to have any effect.
  4. Differentiable. Obviously, there is at least one similarity among the various segments a company identifies and targets, but there must be differences appreciable enough that the segment is clearly defined.
  5. Actionable. The size, volume, and characteristics of the target segment must support a marketing or sales approach, and they must have quantifiable results that can be measured and adjusted.

In Under Armour’s Willful Digital Moves, authors Mina Saghian and Meghan Murray offer insight into the athletic wear brand’s evolution from a one-man basement company to the competitive powerhouse that it is today. In 2013, the company recognized a unique opportunity in women’s apparel, as it represented only about 22% of its revenue.

The men’s athletic-wear market is what drove Under Armour to the heights it attained in just 20 years of business; what founder Kevin Plank realized was that there was an entirely separate market that was just ripe for marketing. After observing an expensive, and failed, effort from competitor Adidas to market to the athletic female demographic, Plank launched his own campaign, called “I Will What I Want.” Using famous athletic women like ballerina Misty Copeland and model Giselle Bündchen, Under Armour’s iconic campaign ultimately resulted in a 28% increase in women’s apparel sales and a 42% increase in traffic to Under Armour’s website, UA.com.

Market segmentation can be done based on any number of factors, including age, socioeconomic status, income, gender, geographic location, lifestyle, life stage, education, race, generation, and even personality characteristics. Really, there is no limit to the level of specificity to which a marketer can drill down when defining a segment market.

I was recently shopping online with my niece, Lizzy, who is 13 years old. She is a very unique kid who loves music, playing guitar, and art. She’s a bit of a loner, preferring the company of one or two close friends to being just one in a crowd. She’s fairly introverted, but shines when discussing things she is passionate about, like the band twenty one pilots (NEVER capitalize their name, Aunt Angie!), Japanese anime, and her slightly off-kilter personal brand of fashion. She spends a lot of time online, either on her phone, iPod, laptop, or gaming console, and, like most young people her age, can’t imagine a time without the instant connectivity of the internet. She is not afraid to speak her mind, and she does not hesitate to stand up for others who are persecuted, belittled, or bullied. She has a very well-defined sense of right and wrong, like most young people, but it’s not all black and white with her; she understands that there are shades and degrees and that justice should be applied on a case-by-case basis, rather than as a blanket policy. In addition to her book smarts (she is consistently on the A/B Honor Roll in school and will start high school in all Honors classes), she also has a great deal of common sense and often operates at a level far beyond her years.

A brand could target Lizzy and other kids like her by incorporating all the things they are passionate about – art, music, and fashion – into a well-executed social media and online campaign. While shopping with her online, it is easy to see how many brands are already tuned into our everyday habits – ads for t-shirts with the bands she loves on them, combat boots that lace nearly to the knee, and art supplies popped up on nearly every page we visited. Later, playing some of the “free” video games on her PS4 with her, I saw similar advertisements targeting kids like Lizzy. This is a powerful segment because, even though these kids may not have a lot of their own money to spend, their parents are quick to provide them with the things they desire…at least, that’s the case with Lizzy and her mom!

Market segmentation is a powerful tool that, used correctly, can catapult a company to the heights of its potential; however, it requires a great deal of focus and structure, with an eye toward actionable, measurable results.

References

“Identifying Market Segments and Selecting Target Markets.” (n.d.) Retrieved 17 March 2017 from http://www.managementstudyguide.com/identifying-market-segments.htm

Murray, M. and Saghian, M. (2016, July 27). Under Armour’s Willful Digital Moves. Retrieved 16 March 2017, from https://cb.hbsp.harvard.edu/cbmp/content/62362880

Lannuzzi, A. (2014, July 30). Market segmentation criteria – Five essential criteria. Retrieved 17 March 2017, from https://www.linkedin.com/pulse/20140730082827-41390803-market-segmentation-criteria-five-essential-criteria

Consumer Who?

Consumer behavior is the study of individuals, groups, and organizations, and how they go about purchasing, using, and consuming products and services in order to fulfill their wants and needs. It is about what motivates us as consumers to choose the products and services we do, whether we’re purchasing for ourselves or someone else, and also what we do after making our purchases – how do we use our products and services and how do we dispose of them? Marketers use this information to determine how to best persuade us to buy their products and services and also to predict future sales.

As an individual consumer, my buying decisions are influenced by advertising, trends, income, and lifestyle. I see advertising everywhere, from my browser when I’m surfing the internet to television commercials and everything in between. I’m also influenced by the buying habits of my friends and family.  To broaden this a bit, consumer behavior – mine and yours – is influenced by cultural, social, personal, and psychological factors.

Consumer behavior falls into four basic types:

  • Impulse purchasing: These are the random goods we pick up while waiting in line to check out with our other purchases – a pack of gum, a magazine, or a bottle of hand sanitizer seems like a good idea in the moment and it gets thrown into the cart with the rest of our items.
  • Routine purchasing: This is the behavior most of us engage in most often – buying groceries, our morning Starbucks, or getting the car washed are good examples. We do these things without much conscious thought and we don’t need to consult reviews or friends to make the purchasing decision.
  • Occasional purchasing: These are purchases that require limited decision-making time – finding a new hairdresser or picking out a new outfit for a special occasion are perfect examples of this type of behavior. These decisions don’t require a ton of thought, but we will usually explore two or three options before making a decision.
  • Rare purchasing: These are major purchases for high-priced items like a new car, a house, or a computer, in which we, as consumers, spend a lot of time comparison shopping to ensure that we get the most value for our dollars. We might conduct this research online, with friends and family, or by reading books or magazines. The decision-making process takes longer for this type of purchase because we expect to spend more money and we also anticipate that the product we buy will last a long time (Brookins, 2017).

All of us exhibit all of these four types of consumer behavior at one time or another, but it’s how we get to that decision that is actually the most interesting part of studying consumer behavior. The consumer buying process includes six steps that show how consumers get from discovering the need for a certain product or service to actually making that purchase, and beyond.

The-Consumer-Buying-Process

The actual decision to purchase is made in the middle of the six stages; at this point, we have realized the need for a particular product or service, gathered information about it, evaluated our alternatives, and finally, we are ready to make a decision. It is here, in these first few stages, that we are most influenced by marketing research and design. As we research our options and choices, we are confronted with marketing every step of the way, from slick landing pages on company’s websites to video and graphical advertising on these company’s social media sites, marketers are using their skills to target and sell to us.

 

After that, all that is left is to actually spend the money, take our new “precious” home, and live with it.  And at the end of it all, we decide whether we like the product or service enough to become repeat customers. If we don’t, that might result in a purchase, but if we do, we have become a marketer’s dream. This is known as post-purchase behavior and it all hinges on our personal satisfaction (or dissatisfaction) with the product or service we have purchased (“Post Purchase Behavior,” n.d.). I have had buyer’s remorse, or post-purchase dissonance, a time or two, usually in relation to customer service more than any real problem with the purchase itself.

So, tell me, what kind of consumer are you? I’d love to hear your thoughts, so leave me a comment!

References

Brookins, M. (2017). Types of Consumer Buying Behaviors & Product Decisions. Retrieved March 9, 2017, from http://smallbusiness.chron.com/types-consumer-buying-behaviors-product-decisions-10273.html

Jones, S. (2014, March 18). The Six Stages of the Consumer Buying Process and How to Market to Them. Retrieved March 9, 2017, from http://www.business2community.com/consumer-marketing/six-stages-consumer-buying-process-market-0811565#u34vi22LB65aPmlB.97

“Post Purchase Behavior,” (n.d.). Retrieved March 9, 2017, from https://www.boundless.com/marketing/textbooks/boundless-marketing-textbook/consumer-marketing-4/the-consumer-decision-process-40/post-purchase-behavior-204-10576/

 

Concluding Findings and Limitations

My marketing research project focuses on a new technology-embedded athletic sneaker from Nike, the leading brand for such products.  The shoe will work in conjunction with Bluetooth technology to provide solutions for runners, walkers, and bicyclers by providing feedback on metrics such as time spent exercising, distance traveled, and calories burned.  It will also connect to various mobile applications to provide additional value.  For example, the technology could connect to navigation apps like Google Maps to create an interactive experience for the wearer via haptic feedback through the shoe, allowing the user to listen to music or podcasts while still receiving directions.  Another potential use would be for health insurers to track its patients health efforts, much like the Progressive “Snapshot” that allows the insurance company to compile data about driver’s habits, both good and bad, to influence discounts on their car insurance.  This blog will explore my preliminary findings and limitations for marketing this new product.

Organizational Objectives

Nike’s corporate mission statement is “To be the world’s leading sports and fitness company,” so its organizational goals are lofty.  One limitation of this mission statement is that it seems more like a vision statement, making it a weakness because it does not address specific products or services provided by Nike.  Also, Nike has no published corporate objectives relating to the overall company from which to work from.  Stakeholders should be informed of a company’s corporate goals in order to understand the nature of the company and its future direction.  From a corporate responsibility standpoint, however, Nike does have published goals: to “lead in corporate citizenship through programs that reflect caring for the world family of Nike, our teammates, our consumers, and those who provide services to Nike.”  This is neither measurable nor time-specific, making it a weak objective.  In terms of strengths, Nike has mastered overall marketing strategies, leading the brand to the top spot in the athletic footwear market.  The company’s competitive strategy has evolved from the 1990’s focus on teamwork to today’s preference for individuality.  Nike is responding to this trend by developing new products that appeal to the younger generation’s sense of customization, personalization, and individualism.

Externally, Nike faces challenges in its core demographic, which is currently aging.  This represents an opportunity for Nike to address a new generation of Nike customers via the previous generation’s children, though there is concern that the next generation will not be as likely to pay the prices that Nike products command, instead opting for less expensive products from competitors like Adidas and Reebok.  Additionally, since Nike has had its fair share of bad publicity over the use of child labor and sweatshops, Nike must pay close attention to the efforts of consumer activist groups.  The opportunity here lies in the brand being able to demonstrably prove that it is taking steps to ensure that such practices are no longer used in its overseas manufacturing plants.  The threat, on the other hand, is that Nike’s ethical image is already lowered in the minds of the public.

Industry trends in athletic footwear

The global footwear market is expected to reach US$371.8 billion by 2020, with Europe holding the honor of the largest market, and the Asia-Pacific market being the fastest-growing.  The product segment forecasted for highest growth is casual, followed by athletic footwear, and the top five brands in the market are Nike, Adidas, VF Corp., Asics, and New Balance.  Some of the drivers for brands in the footwear market are: the quickly-moving pace of urbanization in developing countries, higher disposable incomes for an expanding middle class, the rising popularity of eco-friendly footwear, and the emergence of new designs, concepts, and themes.  The challenges they face are strong competition, a high number of counterfeit products on the market, and changing consumer preferences (“The Global Footwear Market: Trends, Drivers, & Projections,” 2015).

Industry trends in wearable technology

After the initial excitement over wearable technology, the market has cooled a bit toward it, mainly due to the lack of certain features like LTE connectivity and device-specific applications (Beaver, 2016).  Brands are rising to the challenge, though, and in the next few years the smartwatch market expects to see device shipments grow at a rate of 18% through 2021 to reach 70 million units sold.  This suggests that, as functionality improves, the market will respond better to the devices and their companion apps, especially in the health segment.

Marketing strategy

I expect to focus a good deal of my marketing strategy for the new product online, where Nike’s direct-to-consumer business rose 22% in the second quarter of 2016, driven by 49% online growth, bringing its revenue to $9.1 billion (Gustafson, 2016).  Nike’s manufacturing strategy is one of outsourcing, using contractors around the globe.  Vast majorities of its manufacturing are done in the Asian region in China, Indonesia, Vietnam, Philippines, Taiwan, and South Korea.  To ease pressure from consumers and legal cases against the company, Nike developed a code of conduct in 1992 specifically pertaining to manufacturing conditions in its overseas plants.  The brand also employs teams of expatriates from each of the big three countries (China, Indonesia, and Vietnam) to focus on quality control for both products and working conditions.  As a result of the brand’s previous troubles with child labor laws in overseas manufacturing, the company has not quite earned back the public’s trust.

Nike’s basic marketing strategy has been to focus on hero athletes, using names like Michael Jordan to sell its iconic footwear in the name of the Nike Swoosh logo and motto, “Just Do It.”  An ethical concern about this marketing strategy is that the “hero athlete” has come under fire as a result of the behavior of some of these heroes, like Michael Vick, Tiger Woods, and Lance Armstrong.  Though Nike has stood by some of these celebrity spokesmen (Woods, Kobe Bryant) and abandoned others (Armstrong, Oscar Pistorius), public perception of a brand can be badly damaged when the company is perceived to place trust in people who do not deserve it.  Nike will not likely abandon altogether its tradition of using celebrity athletes to hawk its wares, but it may be increasingly difficult for the brand to explain itself given the instant-gratification nature of social media and other instant communications (Kalb, 2013).

References

Beaver, L. (2016, September 27). The Smartwatch Report: Forecasts, adoption trends, and why the market isn’t living up to the hype. Retrieved January 15, 2017 from http://www.businessinsider.com/smartwatch-and-wearables-research-forecasts-trends-market-use-cases-2016-9

“External/Internal Business Factors at Nike, Inc.” (n.d.). Retrieved February 4, 2017 from http://www.freeonlineresearchpapers.com/nike-inc

Gustafson, K. (2016, September 28). Nike’s future sales growth may not be as bad as it looks. Retrieved February 12, 2017 from http://www.cnbc.com/2016/09/28/nikes-future-sales-growth-may-not-be-as-bad-as-it-looks.html

Kalb, I. (2013, February 25). One of Nike’s Core Strategies Is In Danger. Retrieved February 12, 2017 from http://www.businessinsider.com/is-nikes-hero-athlete-strategy-in-jeopardy-2013-2

“The Global Footwear Market: Trends, Drivers, & Projections.” (2015, January). Retrieved January 15, 2017 from http://www.strategyr.com/MarketResearch/Footwear_Market_Trends.asp

Final Project Review

I’ve chosen to focus on Nike for my marketing research final project.  Nike was founded in 1964 by track-and-field coach Bill Bowerman and runner Phil Knight as Blue Ribbon Sports; it later became Nike Inc. in 1971.  In 1988, its iconic “Just Do It” campaign was launched with an ad depicting 80-year-old runner Walt Stack making his way across the Golden Gate Bridge (O’Reilly, 2014).

For the purposes of my project, Nike will be developing a new shoe that functions as a Bluetooth-enabled wearable.  This shoe combines Bluetooth technology with Nike’s legendary comfort and style to provide new solutions for runners, walkers, and the technology-obsessed.

How will it work?

The new product will connect via Bluetooth to send data to a companion smartphone application.  The shoe will collect data on steps taken by the wearer, distance traveled, and calories burned and then send the data to the app to be presented to the user in an easy-to-navigate format.  The shoe will also have a built-in feature that allows for haptic feedback.  The app can be used to connect the shoe to other apps; for instance, connecting to Google Maps would allow the wearer to receive feedback on the left or right foot, indicating which way he should turn while walking, running, or bicycling, leaving his ears free to listen to music, audio books, or podcasts.

Is this the product the market has been waiting for?

To determine whether the market will support this new product, I will have to conduct some research.  At this point, the primary research objective is to determine whether a technology-enabled shoe wearable is a product that consumers need and/or want.  Exploratory research used to identify this objective could include looking at secondary (historical) data from when watch wearables were first introduced and experience surveys offered to consumers who use currently-available wearables (Babin, 2016).

The research design will consist mostly of surveys, but will also include components of observation and trend analysis on wearables in general.  The surveys will be offered via direct mail as well as email, social media, and telephone marketing.

Is the market ready for a shoe wearable?

I think it is.  Health-consciousness continues to trend, and more and more people are looking for ways to integrate technology with their healthy habits.  Nike already has a strong audience in people who are concerned with their health; beyond that, gadget lovers are likely to be attracted to the additional features and capabilities of the product.

References

Babin, B. J. (2016). Essentials of Marketing Research, 6th Edition. [MBS Direct]. Retrieved from https://mbsdirect.vitalsource.com/#/books/9781305688094/

O’Reilly, L. (2014, November 4). 11 Things Hardly Anyone Knows About Nike. Retrieved January 8, 2017 from http://www.businessinsider.com/history-of-nike-facts-about-its-50th-anniversary-2014-11

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