Opinions about branding by Dr. Dannielle Blumenthal

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Tuesday, December 25, 2007

Experiential marketing/branding and the newfound power of Gen X

In an article called “Enjoy the experience turn on, tune in--and pay attention,” (December 3, 2007), Brandweek talks about the trend toward experiential marketing—“essentially, a sophisticated term for getting into public spaces and letting the consumer interact with your product personally.” Apparently giving consumers a live experience with the brand is proving to be a successful way of reaching people. Here are some examples of companies and what they’re doing to give customers a branded experience:

* Panasonic is parking tractor trailers labeled “Panasonic. Living in high definition.” outside Best Buy and other retailers. The trailers have had a makeover designed to look like “a guy’s dream living room,” complete with all the Panasonic electronics it can hold. Sales of Panasonic HDTVs are up an average of 30% at every retailer that’s had the truck parked outside; Panasonic has set aside one-third of its 2008 marketing budget for experiential initiatives.

* The Wii videogame has been on tour to U.S. shopping malls, where consumers can experience what it’s like to use it.

* For Paramount Pictures’ The Spiderwick Chronicles Experience, the company sent “a customized vehicle loaded with digital equipment that stopped at schools, malls and museums, where kids who ventured inside could see how CGI animation works.”

* “DeWalt tools now spends 50% of its marketing budget on nontraditional advertising, including experiential efforts such as Rolling Thunder, a roving display that parks at Nascar events and allows the public to have fun playing with its newest power tools.”

* “Air New Zealand is hitting the streets of California in an ice-cream truck. Free treats are meant to remind customers that there's beautiful summer weather in Kiwi land. ‘It gives a face and personality to our airline,’ said marketing manager Jodi Williams. ‘This approach gives us more buzz for our buck.’”

Experiential marketing is working well right now because consumers are sick of being bombarded with in-your-face TV, radio, and web advertisements, and are shutting them out with TiVo, satellite radio, and simply clicking away from online ads. (Not to mention the do-not-call laws restricting telemarketing.) In contrast, experiential marketing is an interactive, personal, tactile experience that takes place at the discretion of the consumer.

Experiential marketing is not new, notes the article…as long ago as 1911 Heinz sent door-to-door representatives to do taste-tests with consumers. And the tactic worked.

The article also notes that experiential marketing comes with potential pitfalls, such as spoiled food, people who “simply don’t want a leaflet thrust at them,” and with legal issues that come up. But I think one of the biggest potential pitfalls is to create a marketing experience as opposed to a brand experience. People should not just experience the product, they should experience the brand. That is what builds loyalty over the long term, rather than just having the consumer encounter the product and walk away with a shrug and a “that was nice.”

Speaking of experiential marketing, Brandweek also (December 17, 2007) has a case study called “Schwab’s (Gen) X Files,” about an event targeting 25-to-34 year olds in New York in which “teams of financial consultants and brand ambassadors” took up posts at kiosks and “roaming the streets in a 37-foot ‘Talk to Chuck’ RV. They gave out calculators that compared the yield of Schwab’s own checking account vs. the national average, gave out fake ATM cards which people exchanged for $2 bills (and some $100 bills), and also gave out checking account applications. Schwab is pleased with the results thus far. Interestingly, targeting Gen Xers was cited as a priority by 86% of top marketing executives in a recent survey commissioned by the Marketing Executives Networking Group and conducted by Anderson Analytics. This is a very high percentage and only two percent shy of the percentage who said baby boomers are “still the most sought-after demographic.”

I say this is interesting because it seems to me that it is Gen Xers who are leading the charge when it comes to taking their thoughts about brands to the Internet (a la Citizen Marketers), and it is probably . Gen Xers who are the ones tuning out TV with TiVo and turning on satellite radio. The power of this group to completely shift the marketing and branding paradigms we know of today seems very much unrecognized by the marketing media, so it was nice to see the marketing survey come out which pointed to the influence this generation is having.

Now here’s a piece of can’t-turn-away-from-it marketing that clearly doesn’t work. In “Fast food gets its greasy hands on report cards,” the Chicago Tribune talks about a school in Florida that partnered with McDonald’s to feature a cartoon of Ronald McDonald along with an ad for a “food prize” for “elementary school students who had good grades, behavior or attendance.” The idea was for parents to reward their high performing children with a trip to McDonald’s. The promotion, in which the sponsor paid the cost of printing the report cards in exchange for an advertisement on them, totally offended parent Susan Pagan, who was “told that she was the only parent who thought it was inappropriate to put fast-food ads on the report card jackets.” But apparently it’s been going on for the last decade, and Pizza Hut used to be the sponsor. Here is a way, the article notes, that McDonald’s is “branding its product early and often in impressionable young minds to build loyalty and create lifelong customers.” This even though McDonald’s has recently stated that it will “stop marketing all food or beverage products in elementary schools” and will “advertise only its healthier options to children younger than 12.” Pagan is likely a Gen Xer herself; and I am not surprised that her story is all over the Internet.

The bottom line: Gen Xers are taking control of the marketing and branding marketplace, influencing everything about this field in a big way. Nobody is talking about it much, but they really should be. We are witnessing a key generational shift.