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Famous marketing disasters and how to avoid
making the same mistakes
Alistair Stevenson
EEA Project Management Sp z o.o.
Członek Zarządu
Agenda• History of marketing
• Definition
• Market segmentation
• The Marketing Mix
• Famous marketing disasters
• Marketing for small businesses
• More marketing disasters
• Social media
The evolution of marketing
Product orientated• 25 years ago in Poland or 100 years ago in
Western Europe
• Market local
• Less choice
• Basic necessities only
• ...Oh joy, I have found ham...
• No market research
• Manufacturer only concerned with price and quality and hitting manufacturing quotas
Market orientated• Markets are international
• Huge choice
• Most people can afford necessities
• Higher disposable income
• Fulfilment of ‘wants’ and ‘desires’
• Firms must recognise and satisfy ‘wants’ and ‘desires’ now and in the future... and make a profit
... and that is marketing• The theory is that similar people buy similar
products
• ‘birds of a feather, flock together’
• Market segmentation
• Large family cars – segment
• Two seater Dutch sports cars – niche
• Segments dictated by
• Age, gender, income, lifestyle, socio-economic group, education
AgeSegmentation by age, for example
• Marketing to the elderly
• People are living longer
• Increased need for medicine
• Growth of old peoples’ homes
• Specialist hospital services required
• Go-Go
• Go-Slow
• No-Go
Gender• Women spend more on clothes, cosmetics,
jewellery than men
• Male grooming a huge growth market
• Male facial moisturising – new phenomenon
Income• Social circumstances
• A young couple with no children will spend differently than a family with 3 kids
• DINKY
William Lever, 1st Viscount Leverhulme"I know half my advertising isn't working, I just don't know which half."
Direct Marketing• Straight to the consumer
• Database driven
• Text messages
• Emails
• Web
• Letters
• Response generating advertising
• Call centres
Marketing mix• Product – differentiation
• Price – low enough to be competitive
• Promotion – how customers hear about the product
• Place – where to find the product – distribution
4Ps blended to make marketing mix
Which is most important?
Scenarios• Reduce price of laptop computers by 30%
• Then what?
• Research and produce superb new mobile phone and it costs $15,000
• Where is the problem?
McDonalds Big Mac• UK 1990s buy one, get one free
• Insufficient numbers of bread rolls
• Where was the problem?
• How could it have been prevented?
Know your market• Your current customers are the key to all future
customers
• Quick and cheap market research
• Trade fairs... Info on market trends
• Trade magazines
• Internet research and forums and LinkedIn
• Field research by chatting to clients or producing a questionnaire
• Announce your presence at an international trade fair ... Case study
Product• Easier for SME to create new product to
customers’ design briefs
• Service companies match offer to the needs of your customers
• SMEs can offer specialised goods upon customer request
• Offer better advice
Price and Promotion• Many small businesses fail by charging prices
that are far too low – injection mould tooling
• Promotion through word of mouth, internet
• Advertising in trade press
• News items and PR opportunities in trade press or local paper
• Sponsor local sporting events - Candeo
Place• Distribution provides competitive advantage
• Big firms contract delivery to courier companies who have no interest in interacting with the customer
• Small firms can tailor delivery times
• Agfa Poland – building rapport
Scenario• You have a shop selling running shoes and
Decathlon open a mega store 50 metres away
• Apart from taking a length of rope and hanging yourself, what do you do?
Product
• Ron Hill Brooks Saucony
• Audit Decathlon to see what brands they are selling
• Buy a treadmill and a camcorder and offer gait analysis
• Charge analysis fee
Product
• Analyse gait to find appropriate shoe
• Capture name and all contact info along with running type, distance run weekly
• Regular newsletter – creating new communication channel
• Test feasibility of mail order
Price
• Serious runners likely to be less price sensitive
• Superior customer service and convenience can command a premium price – sometimes
Promotion
• Billboard advertising as close as possible to Decathlon
• Leaflet drop outside store
• Articles in local press
• Sponsor local running events
• Benefit from Decathlon advertising to draw in customers
Place
• Stay at current location and benefit from Decathlon advertising and reach to draw customers
• Explore mail order potential
• Pepsi Philippines 1990s
• One lucky cap code to win 1 million pesos
• Pepsi’s sales increased 40%
• Over 30 million people bought Pepsi
• Number 349 appeared on 800,000 caps
• You guessed it...
• Whoops!
• Pepsi gave $20 to each winner not $40,000
• $2 million budget quickly became $10 million
• Number Fever Chile – previous disaster
• How could you have prevented this?
• Buy a Hoover vacuum cleaner and get 2 return flights to Europe or the US
• Hoover thought people would buy their more expensive models
• Completely oversubscribed
• Cost Hoover £50 million
• What should they have done?
• ‘If the US wins, you win’ 1984
• 1976 the US won 94 medals, 34 golds
• In 1976, Russia won 125 medals, and East Germany won 90, with 40 gold medals
• DDR and USSR boycott
• 1984 saw the US win 174 medals and 83 golds
Saving the best to last....• 1981 Osbourne Computers
• Computers in 1981 were NOT portable
• 11.5 kg and cost $1,795
• August $10 million sales
• February $100 million sales
• Apple and Compaq launched portable computers
• Osbourne announced a superior computer to be launched in six months... Bankruptcy
• Why? The Osbourne Effect. Steve Jobs paranoia
Viral marketing spreads like a virus often
to people outside your target group
So be careful with
Special online discount coupons
Invitations to business mixers
Presents
Free entry to business conferences
4chan.org created Anonymous
Tom Cruise first celebrity target
4chan campaign against John Koppenhaver
Cyber-terrorism
Hacktivism
>RIP Dad, sorry I sucked at CPR and
couldn't save you...maybe all these
@$$h*le$ are right...see you on the
other side..miss you
Motion Picture Association of America
Recording Industry Association of America
Visa
Mastercard
Bank of America
150 Australian small businesses
Social media failsLegitimate companies using social media
• Durex – SOS Campaign – Facebook : which city should get Durex condoms – Batman, Turkey
• McDonalds Twitter – McDonalds Memories
• Give a limited chance of responding
• "A photographer is only as good as the equipment he uses, and a good lens is essential to taking good pictures!“ Nikon
• Monitor comments – do not rely on programs and do not delegate to a junior
Qantas Twitter Competition 2011• Describe your ‘’dream luxury in-flight
experience’’
• Win toiletries and pyjamas
• However the airline was on strike
• Thousands of passengers stranded
• Australia’s greatest PR disaster