Facing higher commodity prices and consumer rejection of SUVs and trucks, Ford is doing a quick change on this year's production plans to favor smaller cars and crossovers. President and CEO Alan Mulally conceded that energy costs, commodity costs and the slowing economy are forcing the company to revise its turnaround timetable. Said Mulally in a release: "Unless there is a fairly rapid turnaround in U.S. business conditions, which we are not anticipating, it now looks like it will take longer than expected to achieve our North American Automotive profitability goal." The company had expected to be profitable this year. Instead, said Mulally, break-even will be in 2009. He said Ford is expecting overall Ford, Lincoln and Mercury market share to be at around 14% this year. The company says it will make 690,000 vehicles this quarter--down 20,000 units from numbers the company has announced for the quarter, and off 15% versus the quarter last year. The third and fourth quarters this year will see Ford cut production 15 to 20% and 2 to 8%, respectively. The company says it will boost production of Ford Focus, Fusion, Edge, Escape, Mercury Milan and Mariner, and Lincoln MKZ an MKX while reducing production of large trucks and SUVs. Ford this year will introduce hybrid versions of the Fusion and Milan cars, as well as the all-new Ford Flex crossover, and a new sedan for Lincoln, the MKS. Currently, Ford has two hybrid nameplates, the Ford Escape and Mercury Mariner hybrid crossovers. Boston-based online market-research firm Compete says sales of such vehicles are following the rise in gas prices. Toyota's Prius is benefiting mightily. Compete says April marked the highest shopper count total ever for Prius, with the hybrid car the fourth-most-shopped model in the U.S. The firm says Prius leads the compact car segment in share of segment interest, and that the compact car segment has grown from 26% of the market in July last year to over 33% today. IntelliChoice, a Los Angeles-based automotive marketing firm, says that as gasoline costs go up, mileage figures more strongly in the cost of owning a vehicle, which figures into residual value. Per the firm, fuel costs are second only to depreciation in overall cost of owning a vehicle. "Fuel costs have heavy impact on cost of ownership," says James Bell, editor and publisher of IntelliChoice. He says hybrid vehicles benefit across the range of cost parameters. "The entire cost of ownership for hybrids is a great story. Pretty much across the board non-hybrid equivalents do not do as well from cost of ownership perspective. You see great repair and maintenance scoring, better insurance costs." Bell says Ford must continue to lift residual values. "Thankfully, they are following the path of limiting fleet business, but they need to lower cost of ownership, and fuel efficiency is a big part of that." IntelliChoice has just released a ranking of mid-sized cars by cost of ownership for five years. The firm says the median cost of mid-sized cars is $34,755 after five years, including purchase. The firm lists a series of top cars based on their cost of ownership after half a decade. The firm breaks best-ofs into five different categories--for different price ranges, for example, or best for fuel economy, or for insurance costs. Toyota dominates with 14 entrants, Honda has two, Nissan three, and GM also has three. Ford is not represented among the top five in these categories. The firm says the highest ranking for Ford in mid-sized cars is Mercury Milan and sibling Fusion 4-cylinder cars, which rank overall 17th and 19th in the cost-of-ownership rankings.
Although the timing itself can't be credited to strategy, the fact that Milk-Bones' 100th anniversary happened to fall just as new owner Del Monte is the process of revitalizing the brand is a fortuitous coincidence, and Del Monte is making the most of it. The anniversary is serving as the platform for a full year's worth of events and promotions, starting with an "un-fur-gettable" extravaganza in New York's Times Square this week. This week, Milk-Bone unveiled a 480-square-foot "Milk-Bone Moments Dog House," festooned with more than 100,000 of the biscuits-something you just don't see every day, even in Times Square. The blowout featured guest appearances by Ivanka Trump and Cristian de la Fuente of "In Plain Sight" and "Dancing with the Stars," accompanied, of course, by their dogs. A pet psychic was on hand to do paw readings. There were doggy dancing demonstrations, and "bark-tenders" dispensed Milk-Bone snacks to four-legged partygoers. In addition, the brand presented a $1 million donation in honor of its Milk-Bone Canine Heroes program, a long-standing national outreach program that provides canine assistance service dogs to individuals with physical disabilities, as well as police dogs for law enforcement agencies. The doghouse's walls were hung with photos of celebrities and their canines ("autographed" by both owner and pet) taken by pet photographer Christopher Ameruoso. After the celebration, the signed photos were auctioned off, with all proceeds going to benefit Canine Assistants. The event generated extensive media coverage, even drawing some paparazzi snapping shots of the celebs and their pets for the entertainment magazines. It also served to help publicize another key aspect of the anniversary campaign, a Web-based contest wherein "pet parents" can enter their most memorable "Milk-Bone Moment," captured in a photo or video. The contest will recognize the top 100 "moments of joy that strengthen the bond between a pet and his or her pet parent." Posting of entries and voting will occur on the brand's site through Sept. 18. Participation is also being driven by a mobile contest tour stopping in 14 cities. The grand prize-winning dog will receive a $100,000 contract to be Milk-Bone's first-ever "spokesdog," plus a digital camera. The 99 runners-up also get a camera. How do the anniversary and contest fit into the brand's overall marketing direction? The contest creates a highly visible exposure opportunity for the relatively new Milk-Bone Moment branding message. "We kind of stumbled into the insight that people have tremendously strong emotional bonds with their dogs, and that many of their joyful moments together are based on the pet parent's giving the dog a Milk-Bone," says brand manager Amy Hammerschmidt. "Moments" will be the foundation for a "smart and well-integrated" campaign effort that will be ongoing for the foreseeable future, she adds. Del Monte's $580-million acquisition of Milk-Bone from Kraft Foods and subsequent purchase of Meow Mix, both in 2006, pushed its pet business to the $1 billion level. Other Del Monte pet brands include Kibbles 'n' Bits, 9Lives, Snausages, Pup-Peroni, Meaty Bone and Pounce. Milk-Bone logged a solid performance in calendar year 2007. Sales in supermarkets, drugstores and mass market retailers (Wal-Mart and specialty stores excluded) for 17 varieties of Milk-Bone biscuits, treats and beverages totaled $148.8 million--up 1.8% over 2006, with units up by under 1%, according to Chicago-based market research firm Information Resources, Inc. Milk-Bone dog/cat needs products leaped by 1,159% to $5.2 million, with units up 809%, and the brand's rawhide dog chew sales jumped 636% to $1.9 million, with units up 474%. But with competition, costs and prices all on the rise, Del Monte is not only being dogged about marketing, it's introducing new varieties and distribution strategies. Milk-Bone gained share in Del Monte's fiscal 07 fourth quarter in part because of expanded alternate channel distribution. "This is a key part of what we had anticipated we would be able to do deploy to revitalize this business," Del Monte chairman/CEO/president Rick Wolford said in announcing year-end results. Wolford also said that Milk-Bone (and Meow Mix) are performing ahead of expectations.
For consumers who dream about walking up Broadway in New York City wearing Manolo Blahniks, Fandango, American Airlines and The Westin are dangling that idea. "Sex and the City" fans could win a chance to walk in the footsteps of Carrie, Miranda, Charlotte and Samantha--hopefully in Manolo Blahnik shoes. Online movie ticket site Fandango this week launched a sweepstakes with promotional partners American Airlines and The Westin hotel. Chosen at random, the winner receives airfare for four on American Airlines, a three-day, two-night stay at The Westin New York at Times Square, along with a "Sex and the City" Hotspots tour, courtesy of On Location Tours. Fans also get a chance to visit many of the locations where the movie and TV series were filmed such as St. Patrick's Cathedral, Bryant Park and Mr. Big's apartment. Fandango's marketing efforts range from email blasts to online ads. More than 3.3 million consumers began receiving Fandango's weekly newsletter this week filled with information on the sweepstakes. The email also details tidbits on new films and top box-office openers. Ads will run on parent company Comcast Interactive Media's Web sites such as Game Invasion and FEARnet. Consumers also will see promotions for the sweepstakes on social network sites Facebook and MySpace. Media buys are being made on numerous Web sites through 24/7 Real Media. Fandango will post information about the sweepstakes on "Sex and the City" message boards, along with New York travel sites. "We expect the promotion to get a lot of word-of-mouth buzz, too," says Ted Hong, Fandango's VP/marketing. "In a lot of markets Fandango has become a verb, where people say 'Hey, go Fandango the tickets, and I'll meet you in front of the theater'." A poll launched on fandango.com Tuesday received more than 1,000 responses in the first day. Sixty-nine percent of women participating in the poll say they will see the movie in a group, and of those, 85% say they will get together before or after the movie. "They are seeing the movie as a social event," Hong says. During the next few months, Fandango will launch a host of sweepstakes tied to summer movies about two weeks before each opens in theaters. Summer sweepstakes include trip giveaways in June for "Get Smart," "Love Guru" and "Wall-E." "Dark Night" is scheduled for release in July, and "Tropic Thunder" in August. In a promotion for the opening of "Get Smart," consumers may have a chance to win a nine-day trip to Russia. "I'm not sure where we're sending people for the 'Wall-E' sweepstakes, since we can't send anyone to Mars," Hong laughs. "For 'Love Guru,' we might send someone to Toronto or India. Most travel locations have not been finalized." Typically, the studios releasing the movies pick the promotional partners that provide the trips and accommodations for Fandango's sweepstakes. Sometimes the airline will provide airfare for a promotion if the studio shows the airline in the movie, Hong says. The movie from New Line Cinema, which Warner Bros. acquired, has sparked a marketing frenzy from a host of companies, including Mercedes-Benz, Skyy Vodka, Swarovski Crystals, Air Canada, W Hotel, and NYC & Co., among others. NYC & Co., the city's tourism office, launches a Web site this week to help tourists plan "Sex and the City"-themed visits to New York.
Cerveza Tecate is producing--and is lead sponsor of--a new televised sports awards program to be broadcast on top Spanish-language network Univision. The show, "Tecate Premios Deportes," will air on July 20. It will be taped before an audience at Pasadena (Calif.) Auditorium. Fourteen hundred seats will be made available to the public, with ticket sale details to be announced at a later date. The show, featuring performances, honorary awards presentations and a pantheon of Hispanic entertainers, will comprise awards in categories like North American Soccer, Hispanic Boxer, Baseball Hispanic All-StarTeam, Basketball Hispanic Player of the year, and American Football Hispanic Player of the year. There will also be Tecate Male and Female Athletes of the Year awards, which are among honors for which consumers can vote online through Univision.com. Carlos Boughton, brand director of Tecate Brand Equity for distributor Heineken USA, says the program came as happenstance during a marketing roundtable with Univision. "It was one of those things where you are having conversation and someone has an idea, you talk about it, and the rest of the people get excited about it. The idea just came to life; nobody had done anything like this," he says. "There are a bunch of [Latin American] awards for entertainment and music, but not specifically for sports." He says that the company--and Univision--are expecting the show to garner between a 10 and 12 rating. "It will be on Saturday, a really good schedule, so we feel that it has potential to be a huge, huge audience." Tecate will support the program with radio, TV, print and out-of-home ads as well as special packaging of Cerveza Tecate. On hand to judge are sports writers and athletes like Oscar de la Hoya, popular Mexican ex-soccer goalie Jorge Campos, ex-football great Tony Casillas, NFL Hall of Fame Recipient Anthony Muñoz, former Mexican soccer coach Jesus Bracamontes, and Enrique Borja, president of the Universidad Autónoma de Nuevo León. UANL, or simply Tigres, is a popular Mexican professional football club. Boughton says about three-quarters of Tecate consumers are Hispanic. In Los Angeles, Tecate is now the No. 3 beer brand, and the second-largest beer brand among Hispanics, whose first choice is Bud Light. Beyond the Univision program, Tecate has several sports sponsorships tied up. The company, which has a marketing arrangement with Oscar de la Hoya's Golden Boy Promotions, was recently lead sponsor of the fighter's L.A. bout versus Steve Forbes, and Boughton says Tecate will also be sponsor of the near-certain upcoming redux of de la Hoya versus Floyd Mayweather, Jr., tentatively slotted for this fall. Tecate brand signage will be on the ring turnbuckle pads, per Boughton who says the deal is still being worked out. "And we will have two or three fights of large caliber and are also confirming details around five professional soccer matches in July involving Mexican teams and Mexican-American teams," he says. Heineken USA began marketing Tecate in the U.S. in 2004 when Heineken USA inked a deal with Tecate owner FEMSA Cerveza that made Heineken sole and exclusive importer, marketer and seller in the U.S. market of FEMSA's beer brands Dos Equis, Tecate, Sol, Carta Blanca, Bohemia and Tecate Light. Last April, the companies signed a 10-year contract finalizing the arrangement.
Move over, Klondike bars: The polar bear is about to have its moment. In what can only be regarded as a marketing triumph for the global-warming camp, the U.S. Fish and Wildlife Service announced last week that it was listing the polar bear as a federally "threatened" species. (Several leading environmental groups had petitioned the government back in 2005.) While the move might not seem like a big deal to most consumers, the environmental marketing cognoscenti say it potentially could have a hefty impact in communicating the impact of global warming to a mass market that still doesn't quite believe such a thing exists. "The polar bear is the poster boy of climate change," says Hugh Hough, founder of Green Team, a New York ad and communications agency that helps companies audit their supply chain, and then promote authentic environmental and sustainable activities. Environmental groups, naturally, pounced on the government's decision as a sign that the Bush administration is finally acknowledging the impact of climate change. And that, Hough thinks, means that the whole concept of global warming--long denounced by right-wingers as leftist malarkey--is inching closer to Middle America. While it's true that most Americans believe that global warming is a big deal--a study released earlier this month by the Pew Research Center says that 73% of Americans agree that it is a "very or somewhat serious problem"--that statistic masks sharp partisan divides. About 57% of Democrats and 46% of independents say that global warming is a very serious problem, Pew says, while only 22% of Republicans do. But that's changing, and Hough points out that all three presidential candidates, for example, have vowed to address the issue: "The acceptance of climate change as a problem is something that's more mainstream than most people think, and when you can consider where it stood even two or three years ago, that's a pretty big difference." The Alliance for Climate Protection, the group founded by Al Gore and which launched its $300 million, multi-year "We" campaign in March, says it has signed up nearly 1.3 million people to combat global warming. In a statement, it calls the bear's new status "a step in the right direction. The scientific community believes the polar bear needs protection, and so do the American people, who have been calling for this action in large numbers." Certainly, polar bears seem to have the symbolic edge. Ever since actor and environmental activist Leonardo DiCaprio appeared in Vanity Fair last year with Knut, the polar bear that has come to symbolize the issue for many Europeans, it's been clear that the big white guys may have what it takes to cross over to their native North America. (In Germany, Knutmania continues--now one year old, he was commemorated with his own stamp last month.) And while it's probably too soon to say whether polar bears will become the de facto mascot for global warming in the U.S., they're certainly more appealing than krill, plankton, or Siberian pines. And for environmental messaging, cute matters: Think of how much mileage environmentalists have gotten out of pandas and baby seals. Besides, Hough adds, "thank goodness it's not some ugly little rodent. The polar bear has charisma."
Have a safe and happy Memorial Day, readers. See you on Tuesday.
We need to talk! That's right, every one of us in the promotion industry needs to have a sit down-or maybe more of a knock down/drag out-with our own inner expectations. Because clearly, after all these years of promotional growth and the rise of integrated marketing communications, senior marketing and brand management still don't expect the same kind of strategic and creative thinking from their promotion resources as they do from their ad agencies. Believe me, I know this is painful. There are many client-side marketing execs who would dispute this statement by saying, "We look for great ideas everywhere. We don't give a hoot where the scare-me, rock-me concept comes from." The weird thing is, I believe that they believe it. I really do! I just don't think they expect it. Marketers expect outrageously insightful dives into their consumer and captivatingly elegant marketing challenges to come from ... anywhere but consumer promotion. Come on, I'm being honest here. I don't think they expect a lead creative platform that will drive and inspire the fully integrated 360-win to come from consumer promotion. How do I know this? It's more than my sensitive feminine side and 26 years in the business on both the client and agency side; it's the many off-the-record discussions I have had with client-side pals and the many, many meetings I've attended with lots of smart marketing pros looking for serious answers. And, almost universally, they're not looking to the consumer promotion side of the table. Sure, occasional glances maybe, like hoping to see a blue jay land on your windowsill while sipping a latte-anything is possible, just not expected. I'm not saying that most senior marketers at consumer-driven companies are not believers and supporters in "big idea neutrality." I'm just saying they overwhelmingly don't expect it. It's like promotional prejudice: great at execution, not so great at strategy or creative. This is a dark reality, but true. Since we are being brutally honest, why should senior marketing leaders expect marketing messaging leadership from consumer promotion when it has historically come from elsewhere? Today, in the multi-platform world of integrated marketing communications and the power of non-traditional media, it's the undeniable truth that a great idea can originate in any medium and quickly migrate "up-screen" to traditional television, or "down-screen" to cell phones, the web or in-store. It's about concept elasticity; it's about the insight and the idea that connects with the consumer wherever they connect. Clearly, with YouTube as the ultimate buzz badge du jour, manifest value can be purely random, opportunistic, or more expected by way of re-purposed content. Not every concept should or must be "YouTubable," but there is no better example of the democratization of ideas and marketing. This simply showcases the need for marketing decision makers to recalibrate their expectations and those of their marketing partners as content creators and facilitators. Clients must demand that everyone at their table, everyone that supports their brands be the thought leader! I didn't say "a" thought leader; I said "the" thought leader. The result is that every resource-PR, promotion, digital, advertising and retail-believes that if they create the "Big One," it will fly the entire fleet. True, zero-sum at the start sets in motion the likelihood that something special will come out at the end. It's the expectation, the demand that raises everyone's game-everyone's. So, I end this little diatribe as a promotion guy who loves marketing and knows that we in our little, fun, challenging and exciting world, constantly need to be working as hard as possible to raise our clients' expectations as we raise our own. So that not only will we be more respected as strategists and idea go-to guys, but so that we as an industry will rise above our type-cast, executional past so that promotional professionals moving forward will go into client meetings with everyone's expectations clearly understood before anyone even says a word! Declaration of Expectation