Tuesday, 30 September 2014

How to sell low price or how Lidl Surprises

"Why are you so cheap?" - 9 Lidl lessons

Tesco Ad. on page 23 of Sunday Times supplement of
 50 years of Sunday Times Business  28/09/14

UK Supermarkets Tesco, Sainsbury’s and Morrisons have all lost market share in the past year as the low prices offered by Aldi and fellow German chain Lidl have tempted customers away. 

Aldi has also attracted shoppers with smaller, uncomplicated stores based in neighbourhoods as opposed to out-of-town locations.

Aldi announced  a 65% increase in its UK profits yesterday. 

City analysts picking over the current difficulties at TESCO  refer to the likes of competitors Lidl and Aldi  with the short label of “ the discounters”. 

It is a convenient shorthand of course but it can be rather misleading as it implies that their success is solely down to cheap prices in recessionary times. 

What is so interesting from a Selling perspective is to examine how the discounters actually sell themselves.

 Professional Sellers must be able to either justify high prices or give good reasons for low prices.

 It is part of building trust with your customers.

You’d think that lower prices in themselves would be enough for people to beat a path to the discounters' doors yet they feel the need to communicate and explain why they are cheaper.

Well for starters they tend  not to use the 'cheap' word too much. Their descriptions veer towards being " different " because you can only really sell a difference.

So how are Lidl  - a lidl bit different ?

Before reading on try this exercise - close your eyes for a few seconds and think up 9 reasons why you think Lidl are different! Then proceed and see how Lidl describe themselves and how their customers describe them.

They list the following 9 differences in their "Lidl News" September 2014

Regular readers of this blog will recognise how Lidll use their Offer Analysis of Facts, Benefits and personalised benefits through the use of the words you ,you're, you'll and your.

1.      Shelf Stacking - '...this saves time and money that we can pass onto you'
2.      Chillers - '..We don't follow the crowd we think green'
3.      Keeping it simple -' ..We don't stock more than 7 types of a given product'
4.      Barcode printing on bulky items - ' ..they can be scanned from your trolley, and you don't have to pick them up'
5.      Checkouts - packing benches ' this helps keep the queues down when you're paying and means you don't have to rush to pack once you've gone through the till'
6.      Big brands at small prices- ' ..lots of your favourite big-name brands at prices that you'll love'
7.      Fresh fruit and veg - order only a day's stock at a time  ' so that you can be safe in the knowledge that your fruit and veg is always going to be at its freshest. Just like when you buy it form your local market' 
8.      Carrier Bags - we charge for bags better for the planet -  ' we offer a wide selection from lightweight to heavy duty freezer bags'
9.      Limited non-food special offers - ' Check our website for upcoming offer to be sure you don't miss out'

page 5 of Lidl News September 2014
Discounter customers aren't cheapskates nor prudent puritans but part of the social Lidl tribe.

Lidl even see their customers as a tribe member. They see them and refer to them as ‘Lidlers’. Through facebook and twitter they leverage the posts of 10 million fans across Europe. These are then quoted in prs=ess adverts, billboards and in-store signage. The power of reference is as old as selling. The best salespeople for Lidl are satisfied Lidlers. ( or Brand advocates is you prefer marketing speak)

Lidl still educate sell ( missionary selling lives on in another guise)

Where they feel it necessary they educate Lidlers for example with expertise through their master of wine Richard Bampfield and two other masters of wine with their handy rating buttons and wine grading keys.

Competitive Selling - Don't rubbish the competition let others do it for you.

If you must compare directly to you competition due it through independent review
Lidl communicate the awards they have won in the 2014 Grocer Own label awards – 18 golds, 14 silvers and 75 finalists which apparently is is more than Aldi, Morrisons, M and S Waitrose and the Co-op combined.

Promotions and Momentum to your story

The Lidl When it’s gone it’s gone (WIGIG) offerings come under the their heading of ‘Limited offers. These are trailed for over a fortnight.
29th  Sept: Adult Autumn Fashion, Office essentials and Hi-Tech Offers
2nd Oct -: Car and Travel Essentials
6th Oct : Sewing and Saving Energy
9th Oct: Ladies’ fashion, Health essentials, Baking

Whether your price is high or low you still need to sell the benefits of your offer. If you can get satisfied customers to do the selling for you as brand advocates all the better.

Whether you sell in the high price or low price segment the Lidl model has much to remind us of the fundamentals of professional selling. Good Selling

Related Links :

Saturday, 27 September 2014

Selling Cheap is a risky business low everyday value #Morrisons proposition predicament #Tesco #ASDA #LIDL

Well however we in Selling like to dress  it all up, the challenges of  low price selling remain the same.

Four months ago Morrisons launched their ‘I’m cheaper’ strap.  “It’s the new cheaper Morrisons” in May to promote its “biggest ever” round of price cuts, which saw it lower the cost of more than 1,200 products. 

“I’m Cheaper” campaign played a key role in communicating the price cuts. Now the supermarket is looking to reassure on base prices and communicate to customers that those price cuts are not promotional but permanent.

 Now Morrisons has changed its point-of-sale to show the low price of its products with an arrow with a pound symbol inside pointing down and the words “everyday low prices” (EDLP).

Everyday low prices is “industry-standard language” in supermarkets
 for example :-
Asda also uses an “everyday low price” message
Tesco is currently using a “Prices down and staying down” message
Sainsbury’s continues to focus on values in its marketing
Morrisons new pricing strategy is integrated with
  • improving ease of shop,
  • reducing clutter and
  • making Morrisons’ communication really clear and consistent.

Ad placed in Sunday Times supplement
  50 years of Business
1964 -2014
The supermarket is also hoping to improve its value offering  by making promotions
 clearer and more relevant and boost brand affinity by making more use of the Morrisons yellow.

Morrison plans for local marketing to communicate  new opening hourshours, mostly in-store. 

Morrisons will also launch 'geotargeted' campaigns on mobile.

The 'EDLP’ and ‘Everyday value’ are  generic terms in retail.

 ‘Everyday Low Prices’ is pretty uncreative and  unlikely to stand out in supermarket sector. 

It is the real prices on show that will do the talking !

The extract of the quote from which the congratulatory advertisement to the Sunday Times omits the word 'balance' . The quote comes from one by John Ruskin (1819-1900).

" It is unwise to pay too much, but it's worse to pay too little.
When you pay too much you lose a little money - that is all.
When you pay too little , you sometimes lose everything because the thing you bought is incapable of doing the thing it was bought to do.

The law of Business balance prohibits paying a little and getting
a lot - it can't be done.

If you deal with the lowest bidder , it is as well to add
something for the risk you run and if you do that you will have enough for
something better " 

Related Links

Wednesday, 24 September 2014

Selling cries of famous London-town

Here`s fine rosemary, sage and thyme.
Come buy my ground ivy.
Here`s fetherfew, gilliflowers and rue.
Come buy my knotted majorum, ho!
Come buy my mint, my fine greenmint.
Here`s fine lavender for your cloaths.
Here`s parsley and winter savory,
And hearts-ease, which all do choose.
Here`s balm and hissop, and cinquefoil,
All fine herbs, it is well known.
Let none despise the merry, merry cries
Of famous London-town!

"A nice love song halpenny a piece"
Plate 11 of F Whealey's ( 1747-1801) series 
Cries of London 
Here`s fine herrings, eight a groat.
Hot codlins, pies and tarts.
New mackerel! have to sell.
Come buy my Wellfleet oysters, ho!
Come buy my whitings fine and new.
Wives, shall I mend your husbands horns?
I`ll grind your knives to please your wives,
And very nicely cut your corns.
Maids, have you any hair to sell,
Either flaxen, black or brown?
Let none despise the merry, merry cries
Of famous London-town!

Anon (17th century

Tuesday, 23 September 2014

1st day of Autumn 2014 "...fill all fruit with ripeness to the core.."

To autumn

Season of mists and mellow fruitfulness
Close bosom-friend of the maturing sun
Conspiring with him how to load and bless
With fruit the vines that round the thatch-eaves run;
To bend with apples the moss'd cottage-trees,
And fill all fruit with ripeness to the core;
To swell the gourd, and plump the hazel shells
With a sweet kernel; to set budding more,
And still more, later flowers for the bees,
Until they think warm days will never cease,
For Summer has o'er-brimm'd their clammy cells.

Who hath not seen thee oft amid thy store?
Sometimes whoever seeks abroad may find
Thee sitting careless on a granary floor,
Thy hair soft-lifted by the winnowing wind;
Or on a half-reap'd furrow sound asleep,
Drows'd with the fume of poppies, while thy hook
Spares the next swath and all its twined flowers:
And sometimes like a gleaner thou dost keep
Steady thy laden head across a brook;
Or by a cider-press, with patient look,
Thou watchest the last oozings hours by hours.

Where are the songs of Spring? Ay, where are they?
Think not of them, thou hast thy music too,-
While barred clouds bloom the soft-dying day,
And touch the stubble-plains with rosy hue;
Then in a wailful choir the small gnats mourn
Among the river sallows, borne aloft
Or sinking as the light wind lives or dies;
And full-grown lambs loud bleat from hilly bourn;
Hedge-crickets sing; and now with treble soft
The red-breast whistles from a garden-croft;
And gathering swallows twitter in the skies

John Keats 31 October 1795 – 23 February 1821.
A year after he published To Autumn he died in Rome.

Monday, 22 September 2014

Competition - Is no competition marketing the best man can get patently and fashionably true ? Direct , Indirect and Replacement competition

Gillette Fusion promotion here teaming up with MacLaren Mercedes
Back in the day

King Camp Gillette was an American salesman and inventor who introduced the world to the disposable safety razor in the early part of the 20th century. 

Raised in the Chicago area, he spent his early career as a travelling salesman.     ( Hooray - one of us!)

In the late 1890s he was inspired to create a disposable shaving razor, partly out of personal interest and partly out of a desire to create a product consumers could dispose of before buying another one. 

He teamed up with  machinist-inventor William Nickerson, and in 1901 Gillette formed American Safety Razor, which was soon changed to Gillette Safety Razor. Awarded a patent in 1904.

King C. Gillette sought protection of his new business for safety razors when he applied for trademarks for razors and razor blades, soap, and shaving brushes on Wednesday, May 27, 1908.

The patent system is designed to encourage innovation. This is because patents confer rights on the owner to exclude competitors from the market, offer the incentive for people to study new technology
 Patents are a form of intellectual property

A trademark  is a recognisable sign, design or expression which identifies products or services of a particular source from those of others. 

Competition within the Marketing model
Competition is a vital element in the Marketing Model

First some definitions

#Lidl Surprises 
For example the direct competition to Procter and Gamble’s Gillette Razor Blades would be  other wet shaving razors like Wilkinson Sword, ,Bic,King of Shaves  Azor/ Hyperglide system or own label  razors like Lidl’s Cien razors.

King of Shaves Hyperglide System launched  earlier this year
featured here in a Boots store
Niche marketers use a targeted marketing plan that focuses on one particular section of the market that has high potential to connect with a product or service. Instead of casting a wide net in mass-media and large-event marketing, niche marketing zeroes in on strategically selected venues and media platforms that have high concentrations of these targeted consumers. Will King of King of Shaves is a such an niche entrepreneur. Having had considrable success with Azor the company this year have Hyperglide.

Range of Electric Shaving / grooming
products at a Boots store
The indirect completion to Gillette would be the electric razors like Braun , Philips, Remington, BaBylis Wahl

Yet another form of indirect competition might be the hair removal  /depilatory products such Reckitt and Benckiser's Veet, Church and Dwight’s Nair and  Deciem's Inhibitif.

Indirect completion could also arise from fashion.

 For example :
The emergence of the 'hipster beard' as sported by actor Jonny Depp, or footballer and model David Beckham.

This current fashion has affected the grooming industry with sales dropping by some £72 million last year according to analysts IRI. Not only did it affect sales of razors but other products such as shaving foams, gels, balms, after shave  etc.

Still the retailers still sold some £2.2 billion shaving products across Europe.

Related Links on Marketing

Saturday, 20 September 2014

PESTLE Grinding out real world PESTS in your #marketing model

PESTLE  Real world factors in Marketing – Big Mike and Cavendish

Not for the first time in the history of the Banana,  the cultivated fruit is under attack from a disease. The fruits in Jordan and Mozambique have been found to have a virulent fungus. The disease strain is called Tropical Race 4.

Cavendish is now the world’s single most successful – and valuable – banana, accounting for 47 % of all cultivated bananas and nearly the entire export trade, worth £5.3 billion.

The Cavendish banana was developed as a clone and is today the most important variety in international trade.

 It was introduced to fulfil modern needs for transportation over long distances, ready for ripening with a consistent flavour. 

Today Cavendish is threatened by pests -new strains of fungal diseases

The previous cultivar to today’s Cavendish banana was the Gros Michel or  Big Mike which suffered the pest  in 1903 known as Race 1. The pest ravaged the plantations of South America and the Caribbean.

 The reality behind ‘bananageddon’
Posted by Martine Parry,
Media and Public Relations Manager
 at the Fairtrade Foundation
The Banana is not just a vital form of sustenance but also an important living for thousands.  

Well in this post in Marketing Week on  fruits of Success blog we should look at the equivalent real world pests that can blight the marketer’s marketing plan or crop.

We use the acronym PESTLE to illustrate the real world factors we have to take up the daily grind with in modern marketing . 
(There are other similar models such as STEEPLED, SLEPT and STEER the acronym does not matters as much as what it covers)

Some of these you can predict, some you can prepare for, some you made need a plan b ( contingency plan)  for:-

Political factors are include to what degree the government intervenes in the economy. Specifically, political factors include areas such as tax policy, employment law, environmental law, trade restrictions, tariffs, and political stability.

 Political factors may also include goods and services which the government wants to provide or be provided (merit goods) and those that the government does not want to be provided (demerit goods or merit bads). 

Furthermore, governments have great influence on the health, education, and infrastructure of a nation. 

For marketers they might  have wished to factor in the  Scottish Yes/No vote the effects of decisions on currency ( e.g. £ , Scottish £ or € ), possible ramifications of defence policy ,change in supermarket distribution costs if for an independent country.

The possible ramifications of of Devo Max and the months leading to the  General election on the 7th  May 2015 in the UK will focus  marketer's radar when considering the real world pest factor of politics

Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. 

For example, 
interest rates affect a firm's cost of capital and therefore to what extent a business grows and expands. Exchange rates affect the costs of exporting goods and the supply and price of imported goods in an economy – all questions marketers should consider in their marketing plans .

Social factors include the cultural aspects and include health and well-being consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect the demand for a company's products and how that company operates.

For example 

In response to the  rise in Obesity and health consciousness in UK Coke have introduced  Coca-Cola Life using natural sweeteners including Stevia into the UK August 2014 see previous post .

Technological factors include technological aspects such as R and D activity, automation, technology incentives and the rate of technological change. They can determine barriers to entry, minimum efficient production level and influence outsourcing decisions. Furthermore, technological shifts can affect costs, quality, and lead to innovation. 

Partners with Visa contactless
For example 

the recent  introduction of contact-less payment from Visa contact-less for London Travel,  purchases at partners Starbucks, Tesco, WHSmith and EAT  for purchase sup to £20.

Will this be the death of the wallet or bill fold?

Legal factors include discrimination law, consumer law, antitrust law, employment law, and health and safety law.  Most companies operating in Scotland will know about Scottish Law but if a Yes vote wins the day further legislation is on the horizon. These factors can affect how a company operates, its costs, and the demand for its products.

Implications of legals rulings can have an important effect on marketers .

For example:-
A recent ruling by the European Court of Justice on a case of Spanish budget carrier Vueling Airlines, challenged Spanish law prohibiting carriers from making people pay to put their suitcases in the aircraft's hold. As hold luggage cannot be considered to be 'compulsory or necessary'  when travelling on a plane  ALL carriers should be allowed to charge extra fees - judges said.

Many Budget airlines in Britain such as easyjet and Ryanair already charge up to £75  to check in baggage but the ruling could also be potentially see extra fees on other airlines across Europe.

British Airways which introduced  cheaper ' hand baggage only" fares on some routes last year said it had no plans to alter its policies as a result of Thursday's ( 18th September 2014) ruling.

Environmental factors include ecological and environmental aspects such as weather, climate, and climate change, which may especially affect industries such as tourism, farming, and insurance. 

Buying Fairtrade bananas in the UK means that producers are guaranteed a minimum price, get an extra premium to invest in their community and have improved workplace conditions and protection
© Fairtrade Foundation 2014. Registered charity number 1043886

Furthermore, growing awareness of the potential impacts of climate change is affecting how companies operate and the products they offer, both creating new markets and diminishing or destroying existing ones.

Demographic factors ( can be included as a subset of Social above) include gender, age, ethnicity, knowledge of languages, disabilities, mobility, home ownership, employment status, religious belief or practice, culture and tradition, living standards and income level.

Regulatory factors ( can be a subset of Legal above) could include acts of a future Scottish parliament and associated regulations, international and national standards, local government by-laws, and mechanisms to monitor and ensure compliance with these.

For example
 EU recent regulation impact on Marketing of Vacuum Cleaners

A ban was bought in on September 1, preventing the import or manufacture of vacuum cleaners rated above 1,600 watts, which the EU says will save householders money.

UK shoppers have been rushing to buy high strength vacuum cleaners before the EU ban came into force. UK Sales lifted 3.9% last month. Tesco reported a 44 % increase in sales, Currys said that it had sold out of its 2,000 to 2,300 watt Hoover Breeze and Pet models, and sold out of 2,000 watt models.

The ban starting this month covers cleaners with motors  above 1,600 watts.

The maximum wattage will be lowered even further to 900 watts by the EU in 2017
 if the 2017 cap to 900 watts comes into effect, every one of these best sellers would be prohibited.

Related Links
Related Links on Marketing

The price of a banana bought in a UK supermarket has dropped from around 18p a decade ago to just 11p now. The result is that for farmers and workers in countries like Colombia and the Dominican Republic, growing bananas for a living is becoming unsustainable.
But buying Fairtrade bananas in the UK means that producers are guaranteed a minimum price, get an extra premium to invest in their community and have improved workplace conditions and protection

© Fairtrade Foundation 2014. Registered charity number 1043886

Friday, 19 September 2014

Life’s a soda now. Have Brand Masters Coca-Cola got it right again?

Have Coca-Cola got it right again ?
After a 13 year reign as top brand in the world, last year Coke was superseded by Apple. Well that is how the consultancy Interbrand measured things last year.

How most of us would like to get it as wrong ( I write ironically) as Coca-Cola !

For me they are still the Brand Master when half the world has yet to make its first telephone call , although I guess the current usurper  Masters at Apple may have something to say about that.

I was reminded that even the great Coke occasionally does get it wrong when I came across a product in the Coffee shop attached to the Loyola University, Baumhart Campus, in Chicago where  I was teaching just a couple of week’s ago. One of the Coke brands that does well in the the states but bombed in the UK.

 A marketing launch story of some 10 years ago in the UK.


or 6 weeks of Marketing Hell in early 2004

You would not think that Coke selling branded water would cause it problems.

Dasani was launched in the UK on 10 February 2004. After some unfortunate instances in the launch e.g. Early advertisements referred to Dasani as "bottled spunk" or featured the tag line "can't live without spunk". 

These slogans were used  oblivious to the fact that ‘spunk’ is slang for semen in the UK. 

This was shortly followed  by an article in  the trade magazine The Grocer  mentioned that the source of the Dasani brand water was in fact treated tap water from Sidcup, on the outskirts of London , which followed by a lampooning press who associated this with a well known successful comedy episode of Only Fools and horses saw Dell Trotter tried to promote “Peckham Spring Water” for the mains tap. Unfortunately rather than laughing with the UK public laughed at Coke.

 On 18 March 2004, UK authorities found a concentration of bromate, a suspected human carcinogen, in the product that could be considered harmful if consumed in large quantities. Coca-Cola immediately recalled half a million bottles and pulled the "Dasani" brand from the UK market

That was then –  but remember most marketing case studies are written with hindsight ( case study 20/20 vision) It is surprisingly easy to get cultural vocabulary wrong on the international marketing scene,  misconstrued press articles can be costly and then if the product has some 'teething' problems...

Corporate Resilience

But Coke are bold and good at picking  themselves up, dusting themselves off and starting all over again.   ( for fans of the 1936  movie Swing Time)

Well for you fellow Brand managers out there -maybe tracking the ups and downs of Coke’s newest drink product would make useful learning without the commercial risks they have to take.

Obligatory Blog photo selfie.
 (No bottle of Coca-Cola Life) was harmed
 in the making of this selfie
First thing I notice is the change of brand colour. GREEN but coke is red and always has been surely?

 I mean it's like saying to Ferrari drop the red, to Virgin scrap the red, to Santander give up the red, to Vodafone bin the red.

I mean you don't mess with the Brand's flagship colour! or do you ?

Well things change. sometimes imperceptibly.

 Just Google 'Coke logos' and designs and see how over the years there have been many changes.

The latest addition to the family – Coca‑Cola Life – is now in  UK shops. It's Coke’s first lower-calorie cola sweetened from natural sources.

Coca‑Cola Life is made with a blend of sugar and stevia leaf extract, and contains a third less sugar and a third fewer calories than Coca‑Cola

Coca‑Cola = 42 calories per 100ml
CocaCola Life = 27 calories per 100ml
Coca‑Cola Zero = Less than 1 calorie per 100ml
Diet Coke = Less than 1 calorie per 100ml

Brand masters Coke  are  constantly innovating and creating products . 

The introduction of Coca‑Cola Life is part of their commitment to offer a variety of drinks, so there’s something to suit every “ lifestyle and occasion.”

The Coca‑Cola range now, it seems, has something for everyone: Coca‑Cola, lower-calorie Coca‑Cola Life and two no-calorie options, Coca‑Cola Zero and Diet Coke.

Following 5 years research In Argentina Coca-Cola Life was launched first in June 2013, followed by a roll out in Chile in November in the same year.

It is the first version of the soft drink to be produced with stevia and sugar as sweeteners.

 Coca-Cola Life was launched in the USA, Frontier of Mexico and Sweden, in September 2014; and is undergoing trials in the UK as of August 2014.

POP in W H Smith store
So why have Coke launched this new cola?

 They know there are consumers who are looking to reduce their calorie intake without compromising on taste and there is growing interest in new ingredients, such as stevia leaf extract, that provide sweetness from natural sources.

The launch of CocaCola Life is also the latest in a series of initiatives  to promote well-being and help address obesity in the UK.

 It is just one of the ways we're providing consumers with soft drinks for every lifestyle and occasion, so that consumers can make choices to meet their individual needs.

Stevia sweetener has already been introduced into Sprite, reducing its calories by 30% compared with its previous recipe

Bottles and Cans of Coca-Cola Life in their
distinctive green packaging in a Sainsburys Store
Coke has been steadily reducing the calories of some of their other popular brands, Lilt, Oasis and Fanta, by 56%, 35% and 30% compared with their previous recipes

They have been Increasing marketing investment for their low- and no-calorie colas, Diet Coke and Coca‑Cola Zero

Broadening thier packaging range to include smaller portions with the addition of a new 250ml can

Investing  some £20m to help inspire 1 million people to get active by 2020 through physical activity programmes such as Coca‑Cola Zero ParkLives

This summer they  launched Coca‑Cola Zero ParkLives: a nationwide programme of fun, free, family activities in the heart of local communities – the parks!

In their first year, they have teamed up with local councils in three cities: Birmingham, Newcastle and the London Borough of Newham.

This will be  expanded with the programme to work with more UK cities in 2015, with the aim of inspiring even more people to get active.

“From Tai chi to Rounders, Zumba to Table Tennis, there’s something for everyone, and the activities on offer have been informed by local research. The sessions are taken by local session leaders and, what’s more, they’re completely free to join!”

Coke believe that leading an active lifestyle is one of the most important things you can do for your health and happiness.

 Earlier this year, Coke made a pledge to get one million people active by 2020, and Coca‑Cola Zero ParkLives is a key part of this commitment.

They’ll be working with the national physical activity expert ukactive to closely measure the impact of the programme and ensure it makes a positive difference in each city.

So brand managers ,keep an eye out and learn from THE Brand masters at Coke - even if your have to do so surfing on your new Apple i-phone 6 launched in the UK today!