The Co-Operative Group – Brand Repositioning

The Co-Operative Group (Co-Op) is the UK’s largest mutually-owned business. In such a ‘mutual’ business, the owners of the Co-Op are not shareholders, but consumers and the general public, who can opt to become a member of the company and participate in decision-making.  The Co-Op group has brand-extensions into a wide range of services, including groceries, funeral care, travel, banking and even more.  Having said that – until now – the Co-Op’s strap-line has been ‘Good with food’; this seems rather narrow given the diversity of the firm.

Hence, it is, to an extent, no surprise that the Co-Op has updated their strap-line to reflect the firm’s diversification into wider consumer services.  Unveiled in their new Christmas campaign, the new strap-line is: ‘Here for you for life’.

Unfortunately for the Co-Op, this change has received a mixed-reaction among marketers.  However, this is often the case when any firm changes its logo, strap-line and almost any part of its brand-identity.

Click here, or on the image below to view one of the 20+ Co-Op Christmas TV advertisements.

Given the extent of the Co-Op’s diversification, I do feel the old strap-line – ‘Good with food’ – does not help create a strong corporate brand across the Co-Op’s full-range of services.  Furthermore, as the Co-Op continues to expand with a takeover of 600 Lloyd’s TSB bank branches, the old strap-line is only going to become even more ill-fitting of the mutual group.

Gill Bar, Co-Op’s Chief Marketing Officer, has told Marketing Week that ‘one of the objectives of our advertising is to make the links between the businesses more clear’. Thus, the old strap-line is clearly not in-line with the firm’s wider marketing strategy.

But – and this is a big but – although the old strap-line does not make the links clear between the Co-Op’s businesses, neither does the new strap-line!

Albeit this is down to personal opinion, the new strap-line – ‘Here for you for life’ sounds generic and dull.  Despite having read around this topic a lot, I am constantly having to remind myself what the new strap-line is.

It seems that the Co-Op have gone from a strap-line that is too specific to a new strap-line that is too general.

What I would have suggested to the Co-Op is to have an individual strap-line for each sub-brand that is centered around the  ‘Good with..’ message.  For example:

  • Good with insurance
  • Good with banking
  • Good with funeral care

I believe this would be more memorable and specific than ‘Here for you for life’, while still general  enough to allow the Co-Op to continue to diversify.  But ultimately, my suggestion clearly strengthens the links between the various sub-brands – it may also help consumers identify them as belonging to the Co-Op. And isn’t that what the chief marketing officer is trying to achieve?

The downside of my suggestion is that it is not consumer-focused, which other writers feel is important to build upon to leverage the Co-Op’s strengths as an ethical brand.

Sources and further reading:
Marketing Week – News

Marketing Magazine

The Grocer

Retail Gazette

The Guardian

Marketing Week – Opinion

© Josh Blatchford, author of Manifested Marketing, 05/10/2012

HTC – Brand Repositioning

HTC is the world’s third largest mobile phone manufacturer – with Apple in first place and Samsung in second place – according to market share.  Samsung better watch-out, however; HTC have just announced a strategic partnership with ‘Beats by Dr. Dre‘, the premium priced headphone producer.  By doing what could be considered a typical ‘market challenger’ strategy, HTC aim to increase their smartphone market share by targeting the teenage market that is dominated by RIM, who produce the Blackberry.  Hence, a new product range of smartphones that feature Beats audio will be launched later this year.

Although the teenage market is lucrative is it really wise to aim to reposition the brand to appeal to the mass market without acceptance from ‘early adopters’?

HTC essentially hope to steal away teenage blackberry consumers.  However, these users are considered to be the ‘early majority’ in purchasing new technological products.  For instance,  Blackberry was initial targeted at business users – who made up the early adopters – by positioning the full qwerty keyboard phones as being easy to use for sending emails.  It was not until their products had gained acceptance by these early adopters that teenage girls saw the product would also confer benefits for them too.  Namely, the keyboard would be great for instant messaging and texting.

The problem with HTC’s strategy is that they plan to completely avoid appealing to early adopters with their new Beats smartphones.  They are hoping Beats’ own branding – high-quality and fashionable – is strong enough to convince the mass market teenage to immediately purchase the new phones.  I think this is highly optimistic.

The teenage market has already demonstrated that they will not be enticed by a new product easily.  Hence, what I believe HTC should do is to target the audiophile market, who want a stellar sound performance from their mobile phone.  Thus, theoretically, the smartphone would be initial purchased by a few consumers – the innovators and early adopters – then by teenagers – the early majority, who need to see the benefits of a product before making a purchase.  Moreover, by targeting audiophiles, chances are HTC could steal market share away from Apple as well as RIM; consumers who want a mobile phone and an MP3 player in one device would now have an alternative to the iPhone.

Overall, I like the idea of repositioning HTC’s product mix by introducing a new range of music-orientated mobile phones.  The trouble is they are targeting the wrong consumer.  This highlights an oft forgotten fact of marketing: you must successfully target your consumer before trying to position the product in a way that would convince them to make a purchase.  In this case, HTC need to market to early adopters.  Then, through word-of-mouth promotion, can HTC tap into the goldmine that is the mass market.

Do you currently use a Blackberry – if so why? Does HTC’s Beats range appeal to you?

© Joshua Blatchford, author of Manifested Marketing, 12/08/2011

Coca-Cola – Repositioning

Coca-Cola have recently launched a new advertisement that will air each Saturday evening on ITV.  The aim of the latest marketing campaign is to reposition the Coca-Cola brand as a meal-time accompaniment: their key message emphasised is “meals taste better with Coca-Cola”, which will be featured in the majority of their marketing material.  Where as, the television advertisements will feature the lines “Saturday night tastes better with Coca-Cola and ITV1”.

This is evidence of behavioural segmentation, based on occasion.  This is when a large market, such as for Cola, is broken down into sub-sections according to when the product is used or purchased; in this case, Coca-Cola want consumers to associate meal-times with the drink to build up product consumption, and thus sales.   Hence, this is a market penetration strategy.

This is a very simple and clever move.  It is a relatively low-risk approach to generating sales: effectively encouraging consumers to purchase more of the product – as meal times require large quantities of drink – it is an efficient way to boost sales.  This is because it is unnecessary to completely re-brand the drink, which is costly and can go disastrously wrong. With Coca-Cola, however, the combination of a long-term differentiation strategy and a strong corporate brand make this unnecessary.

Although repositioning strategies often only generate short-term sales, this approach may be an exception to the rule; the tie-in with ITV, who have recently began airing ‘Britain’s Got Talent Again’, is likely to generate long-term loyalty.  This is because their occasional segmentation, which has identified families as a target market, may encourage weekly usage: families get together each Saturday with a meal and enjoy T.V. in the evening with one-another.

This seems very 1950s-60s to me – families sitting down together, and enjoying each other’s company.  Perhaps Coca-Cola is alluding to the brand’s traditional connotations?  This is likely to be the case given the company’s recent 125th anniversary.  One could even go as far to say that the company is using the stereotypical, happy 1960s family as an aspirational group for mothers: if mothers want the perfect family, the thoughts of family meals enter their heads first and then closely followed by Coca-Cola.

Ultimately, this is a very simple strategy.  But if you look at it closely, it is psychologically very, very powerful.  There is a snatch, however.  Just how true is it that families sit-down together for meals in a modern society?  Moreover, is it necessarily the mother who will make the purchase decision?  Another issue to consider would be the health issues: as fast-food places always offer discounts on fizzy drinks along with meals and, consequently, Coca-Cola could become more associated with takeaways than traditional meals?  But, then again, this would still increase product consumption…

© Joshua Blatchford, author of Manifested Marketing, 13/06/2011

Diageo – Market Development and Brand Repositioning

Diageo is the drinks group behind the likes of Johnnie Walker, the scotch; Guinness, the beer; and Blossom Hill, the wine – a well-rounded product portfolio. The group recently announced revenue had increased 5% to £9.78 billion and operating profit had risen 2% to £2.45 billion for their financial year. This was despite the weak consumer spending in the US and Europe – their largest markets, suffering from recent recessions – where the net sales in the former fell 3% and 2% in the later. So how did Diageo remain resilient? By Market Development – expanding across several markets with the current product portfolio. And, as marketing and planning is a cyclical process, Diageo has not forgotten its core market, the UK: Guinness is about to repositioned.

Although, according to Ansoff’s Matrix, Market Development poses high levels of risk when initially expanding – moreover given localised brand names used in alcoholic drinks – the spread of revenue channels in the long-term reduces Diageo’s reliance on one economy. Therefore, a PEST analysis is always a fundamental influence on the marketing strategy. Diageo has furthermore proven the benefits of risk-taking: scotch drinks returned a 15% net sales growth in Latin America and 10% in Africa; most importantly, however, their market share increased as well as volumes. When their sales are boosted by GDP growth, and higher overall consumer spending, of emerging markets and one-off factors, like the World Cup in South Africa, it is important for the sake of raw-competitiveness that market share grows by a greater proportion to be hailed a success.

However, Diageo have clearly identified the UK market as their ‘Cash Cow’, which needs to be milked for all its worth, where as Latin America and Africa can be considered ‘Rising Stars’ – if one uses the Boston Matrix to analyse markets rather than products of a firm. Diageo’s repositioning of Guinness as sports brand, therefore, is a form of market penetration; this is a low-risk strategy, albeit with low scope for growth. The ‘Bring it to life’ campaign involves above-the-line T.V promotions, sponsorship of Sky’s 3D sports coverage – which is currently only available in pubs – and nostalgic football advertisements in newspapers. While none of this is particularly innovative, Guinness’ brand image is consequently associated among sport viewers – and not sport hooligans.

If there is one lesson to be learnt from Diageo it’s diversity: a strong product portfolio in a variety of markets sold through a focus on traditional and new marketing strategies.

© Joshua Blatchford author of Manifested Marketing 30/08/2010

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