pepsi

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Kola House.

I like PepsiCo’s idea to launch a new theme restaurant in NYC called Kola House. It’s daring and smart. Especially for a carbonated soft drink in second place, losing year-over-year volume. Not every marketing issue can be fixed by advertising and it looks like Pepsi is trying some new things. This multimillion dollar bet should energize the brand and, more importantly energize the marketing team — something Pepsi sorely needs.

Using the Kola nut as their north star and Chelsea in NYC as their launch pad, Pepsi has a shot at adding relevance to a brand for millions of typically uninterested people. It’s an unfair fight in what once was a cola war and is, now, no longer. The learning and outputs of Kola House may have great impact on the business. A new drink. A new snack. Perhaps a new line of clothing or even a new app.

We’ll find out. When you change the game good things can happen. Dialing down the Pepsi, celebrating the Kola and creating a new experience is an exciting marketing test lab. Dare I say, it’s refreshing?

Peace.

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Not every product or service is perfect. Some have warts. Better alternatives are often available. So how do imperfect marketers move on? Well, they can and should try to improve the product; that said, Pepsi will never learn Coke’s secret formula. So what do they do?

When called in as a brand strategist in these imperfect product cases, I dive in looking for all that is good. My framework is about customer “care-abouts” and brand “good-ats.” When the two are aligned, we have a plan. When not we have work to do.

Have you ever walked past a person on the street with a magnetic sense of style? Attractive but not pretty or handsome? They are accentuating the positives. They’re not hiding unattractive qualities, they’re celebrating what they have. With panache. That’s what brand planners do. They find an organizing principle for product or service that is loveable and admirable. And they help find ways to celebrate it. Experience it.

As a child, I was not a fan of clams. My west coast uncle came to town and with a few slurps, some facial expressions and a excited description or two, changed my whole perception. His love came through.

This is how we do-oo it!

Peace.

 

 

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In the hummus wars there are two brands Sabra and Tribe. The former owned by Pepsi has 30+ points of market share while Tribe has 7%. The former has a name connoting Middle Eastern cuisine and chick peas. The latter has a name that, contextualized, points to a market. Maybe. The former has Pepsi the latter has Ellis Verdi and DeVito-Verdi.

I’ve had farm stand hummus made the night before that made me melt. I’ve had hummus from the fridge with a faded sold by date that made me yearn for processed Kraft slices.

Store bought processed hummus is not a product with great variation in taste from one brand to the next. So branding is important. Hummus sales are growing like a dookie in the U.S. and Tribe wants it unfair share. DeVito-Verdi will put Tribe on the map. The new campaign, which I have not seen, will give them an idea. It will make them a part of the conversation. It may even contain a selling point or two, e.g., healthier for you. But this is a commodity market, and if you want to be part of the conversation, you want Ellis (and Sal).

Marketing executives care about share. They care about their advertising. They also care about public opinion. If you can live a little on the edge and need to ring the cash register, give DeVito-Verdi a try. 

Market share in the hummus wars is about to change. #heardherefirst. Peace.

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coke

Sales of the Coca-Cola Company dropped 3.6% this quarter. It seems the tide has turned.  The global sugar water growth that offset the diminished appetite for Coke in the U.S. has brought Coke’s growth back to earth. Pepsi saw this sales ding years ago. Coke has been getting into the healthier-for-you businesses for a while now but it looks as if they must really redouble their efforts. Healthier-for-you is the future.    

Big data will help Coke figure out where lost sales are going. Big data, used by CMS (Center for Medicare Services), will also show where unhealthy eating and drinking habits are happening. And by sharing this information with doctors and insurance companies it will pave the way for incentives for consumers to eat better. Much the way insurance costs go up for smokers. Gonna happen.

When you are Coke and your sales are off 3.6%, you need to “refresh” your thinking. (I smell a cold-pressed juice purchase in the near future.)

Pepsi is holding its own by dialing up salty snacks. What’s the opposite of healthier-for-you?

Now is the time. There should be and will be a marketing investment shake up in Atlanta. And “happiness,” the Wieden+Kennedy campaign?  Not likely to make it in its current form — not in this climate.

Peace.

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PepsiCo is managing its broad portfolio and having issues. If you put all the brand managers from all the Pepsi brands (Frito Lay, fast food, etc.) into MetLife Stadium (referred to with a smile as “the snoop”), it might fill the lower level of seats.  With all those people gathering paychecks wouldn’t you think someone might come up with a new line of drink to help grow the soda business which is flat, flat, flat?

Water is done. Orange-flavored drinks done. Energy drinks done-ish. Teas still have some upside, but corporate knows putting the pedal down will cannibalize the sugar water business. So what’s next? Pepsi needs to be as innovative as the tech sector. It needs to travel the world for the next cool flavor. And let’s start with flavor before we delve into the nutritional benefits – which are very important but secondary if trying to grow the drink market.  Pepsi’s CEO Indra Nooyi should empty the building in Purchase, NY and send people packing for 3 months – on global expeditions to find the next flavor. It’s out there, we just forgot to look.  Can you say cola nut?

I enjoy ranting about Pepsi Refresh.  What a mess!  What a lucky marketing tactic for Coke. Could Pepsi have selected anything more non-endemic to the brand?  The only thing endemic is the word refresh, which they stole from Coke. But ironically, they’re using the reboot definition.  Ms. Nooyi find a new flavor!  Don’t build us a playground.  Build us a new drink to grow the category. Peace!

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There’s a great business and brand planning question I often use during discovery: “Who will win the sale you lose?”  If talking to Coke, the lost sale might be to Pepsi (not likely), a store-brand cola, a couponed cola or maybe a tea or flavored water.  If speaking with Microsoft about Office 2010, the lost sale might be to Google Docs.  Conversely, it’s also nice to know who will lose the sale your brand is going to win.  Nice questions — all with actionable strategies. 

With the growth of the Web and social media and the preponderant ad-supported model where many services are free (see Google Docs), there’s no sale to lose just a lost ad impression.  Readers know I’ve been working on a marketing planning tool called Twitch Point Planning. A twitch point is a point in a media experience, where the visitor disconnects. So, if I’m reading a magazine article there is an Emily Dickenson poem cited, I might twitch over to Wikipedia for a quick side-bar. Or I might Google her and the verse. In this example I’ll likely return to the article, but in many cases I’m gone.

Why is Twitch Point Planning important?  It’s important because as a publisher or marketer you want to minimize the loss of your audience. Or, you want to twitch them deeper into your site or sales process.  Facebook is such a force because people don’t twitch away very much.  And many marketers are even understanding the value of completing the sale on Facebook.  

Marketers need to understand, map and manipulate Twitch Points in ways that provide branded value (not spam) at the most appropriate times.  If they do so, they will be able to reduce the space between the consumer and a transaction.  Peace.

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Here I go again about Pepsi Refresh.  Broken record,  I know. And please don’t think me a geeze for seemingly dis’ing media socialists and their heartfelt efforts to do good’s work on behalf of brands. (Liberal I am.)  But count the likes and clicks and friends and authenticity and opacity and, and, and in the soda category this week and two numbers stick out: Coke’s North American volume is up 3% and Pepsi’s is up 1%.  2 percentage points in market research may not seem like a lot, but in a billion dollar consumer business that some serious.  Especially in the much attacked sugar water marekt. Right Michelle?

Coke’s earning, announced this week, were kicking on all cylinders. First time in a long time. And Pepsi’s were down, overall.  No wonder Pepsi chief Indra K. Nooyi took a couple on the chin in the analysts call.   To be read in a whining voice “Commodity prices, really killed us. Considering the economy we did gre- ate.”  Well watch Mad Men.  Commodity prices have always been a problem for which one must be prepared.  Playing with pop marketing tactics, not well integrated into your core value prop or linked to an ersatz brand plank, do not a great earnings report make.  Head down. Sell soda. Peace!

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Pepsi Give Away.

I wrote recently about Pepsi’s 2010 decision to not run Super Bowl ads in favor the “Pepsi Refresh” project — a corporate effort to take the $20 million it usually spends and fund social projects like new playgrounds, high school band uniforms, etc.  The money would be distributed via a social media circus taking place on Facebook and Twitter.  

Apparently there were over 77 million votes registered in the ether, 120,000 idea submissions and 400 winners to date. The only losers seem to be TBWA/Chiat Day who helped come up with the dog of an idea and Pepsi itself, who saw sales drop 6% in a category that slipped 4.3%.  That’s a delta of 1.7% for those who are counting.    

“True that” I’m all about companies doing go.  But in order to do good, one must be a thriving brand.  Pepsi is not. Colorful, yes. Stylish, yes.  Happy and friendly, dittos. It’s not even holding its own in a tough sugar water market.

Pepsi Refresh was a bold step. Stealing refresh from Coke was an interesting notion. But marketing is about selling. Head of Pepsi Digital, Shiv Singh, says the project was “an investment to build brand awareness and cultivate a long term relationship with consumers. It was designed to drive brand health.”  Let’s get back to brand strategy Pepsi. That’s where health is…not in media strategy. Peace!

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Pepsi ReFunk

Okay I could be tripping and correct me if I ‘m wrong, but wasn’t the Pepsi Refresh Project going to be funded by taking money normally put into Super Bowl ads and reallocated to well-meaning projects around the world.  You know – “Come on world, tell us how you want us to spend our money and we’ll refresh the planet!!!”

I’m all for doing good, or as I wrote in a strategy for Bailey’s Café in Bed-Stuy “doing good’s work”, but the whole Pepsi Refresh thing seems a little off.  Like a big advertising application in search of a product.  Anyway, I read today that Pepsi has a number of spots on the Super Bowl.  And the two most recent posts on the Pepsi Refresh Facebook page are from 17 hours ago and Tuesday.   

I “like” Pepsi’s refresh advertising, its intent and its lovely imagery, I’m just not so sure I want to vote for Pepis with my mouth.  (Drink it, that is.) Isn’t that the point?  And please, don’t tell me the category is mature and everyone knows what Pepsi is  – a similarly expressed sentiment, from earlier this week in a Tostitos article. 

Refresh should be moved to the corporate side of the business – kept alive and funded – but let’s refresh the strategy and move some cases. (The Coke people probably don’t agree.) Peace.

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Thank God Tostitos is Reuniting America.  Someone has to. Now, if they could only take on gun control.  Reunite America is the silliest, most well-intentioned, advertising idea I’ve heard in a long time.  I thought tossing or snapping Tostitos around the room and off the wall was silly, but this takes the tortilla.  And to read about the campaign (Goodby, you should be ashamed of yourself) in Stuart Elliott’s ad column today, it seems as if this is not so much a brand idea as it is a media strategy.  To wit (as reported in the New York Times):  

The goal of the campaign is to establish Tostitos as a brand that “brings
 people together through the power of technology” said Justin Lambeth,
vice president for marketing at Frit-Lay in Plano, TX. 

Is the technology the onion dip bowl?

Beside myself am I. My fingers have seized up with the thought of this campaign – well-meaning though it may be.  Tostitos is owned by the Frito-Lay unit of Pepsi, a company busy refreshing America.  So, at least we are in good marketing hands fellow countrymen.  Sugar water and salts snack….taking care of the motherland. Peace!

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