All For One & One For All - Group Buying Sites & Brand Communication

If there’s one sector doing particularly well in the current economic downturn, it’s the group buying market.

Groupon, which is leading the way in the UK, has nearly 2.5 million users and has become one of the top 50 most visited sites in the UK. And now, rumour has it that Internet giant Google is set to launch a daily discount service of its own - Google Offers - to compete with Groupon, Incahoot and others.

Worldwide Groupon reportedly had sales of $760 million in 2010 and is said to be targeting revenue in 2011 in excess of $1 billion. It’s big business.

The appeal is easy to see. Rather than paying the full price, group buying websites allow users to join forces to take advantage of special offers on experiences, restaurants and hotels. The sites use the group buying power of their members to negotiate discounts on products and services that consumers are looking for.

It represents something of a cultural shift. Until now there has been a dichotomy in modern life between “standing out and fitting in”. Whereas ‘standing out’ has tended to be “winning” in recent years, many developments - not least social networking and the re-emergence of the fundamental human need to connect and be sociable - suggest that “fitting in” might be becoming more important once again.

So with the group buying concept seemingly set to flourish, brands need to understand the implications for their own communication with consumers. In recent years, the whole thrust of development of brand messaging, communications, and even innovation has been to achieve as much individualisation as possible. Now it might seem that the pendulum may be swinging back to collectivism. This will require brands to adopt different strategies and a different tone of voice.

Nobody has done this more naturally than T-Mobile with its flash-mob advertising and the theme of “life’s for sharing” which contrasts campaigns that focus so heavily on the needs of the individual, like L’Oreal’s “because you’re worth it.

Brands need to appreciate what the group consumer approach might mean for their brand. It may require brands to talk less about “me” and the themes of individual empowerment, individual expression and individual needs, and more about “us” and how their brand can help customers connect with other people and what it means to be a part of a social group.

‘Till the souvenir garden gnome do us part

The Centre for Retail Research’s estimate that April’s royal wedding between Prince William and Kate Middleton will provide a £515.5 million boost to retailers - with souvenirs bringing in £222 million – proves, as if proof was needed, that this is much more than just another set of nuptials.

But along with the official Royal Collection handmade plates, cups and pill boxes that feature the couple’s entwined initials in gold and silver, a whole host of very unofficial merchandise is hitting the market.

In addition to the recently launched “lavishly lubed” and “regally ribbed” Crown Jewel condoms, design agency KK Outlet is reporting strong interest in its unofficial royal wedding plates bearing the slogan ‘Thanks For The Extra Day Off’, whilst B&Q is preparing to fill its stores with commemorative royal wedding gnomes at £20 for the pair. And as if that wasn’t enough, a graduate from the Edinburgh College of Art is preparing a second run of Royal Wedding sick bags, which are decorated with a crown, a drawing of Prince William and Kate Middleton and the slogan, ‘Throne Up’. The first batch sold out almost immediately.

Is this a disrespectful slant on an important national occasion? Are we too reverential as a nation and is there any reason why brands should not treat the royal wedding with a bit of irreverence? Does this constitute having fun with the British population – or offending it? How big a risk is this for brands to take?

Sense of humour is, of course, important; it’s one of the factors that contribute to giving a brand a personality….but the personality must always match that of the brand’s natural customer base. This is a classic case of knowing and understanding the motivations of your consumers and your target market base and assessing the fine line between irreverence and offence.

If you know and understand your target market properly then irreverent products won’t offend a target base you know to be irreverent itself. Moreover, how great is the risk in offending people who aren’t going to buy your products anyway? Doesn’t that make the brand edgy and therefore more appealing to its core customer base?

The royal wedding together with the Queen’s Diamond Jubilee next year present massive merchandising opportunities for retailers at a time when the economy remains suppressed. No retailer will want to miss out on that opportunity but creating a point of differentiation in what is and will be a crowded market will be key to commercial success. And understanding the motivations of your core customer base is central to that objective.

Is Facebook becoming the Tesco of the Internet?

If everyone who had a Facebook account voted for The Social Network in the upcoming academy awards, the movie would walk away with every Oscar for which it is nominated. After all, currently more than 600 million of us are active users, including almost half the US population.

But all is not as it may seem in Facebook-world. What began in 2004 as a way for each of us to connect with old and new friends online, share embarrassing photographs we wish we hadn’t posted and let everyone know in real time what we’re doing, where we’re going and how we’re feeling has clearly become more than just that.

Spam has become the latest retro brand to implement a social media strategy to tell the brand's story and widen its appeal. The 70-year-old canned-meat brand will focus on promoting the ‘character of the brand’ through coupon distribution, competitions and special events, centred on social media.

It is against this background that Facebook is fast becoming the Tesco of the Internet; a ubiquitous, benign presence that is infiltrating every aspect of our lives. The sheer number of brands using Facebook is fast changing its character from being a site intended for social-connection towards what is almost a self-contained version of the Internet – a one-stop shop for life.

The beauty of Facebook was always that it was the product of its users; we controlled the content. Somehow we were in charge. By inviting such overt commercialism, is there a risk to its success when we conclude the Facebook is so all pervading? What will be particularly interesting is whether and how Facebook users kick back against this.

Brands are still trying to work out how to concentrate their efforts online. A social media presence is only really useful if it creates a genunie two-way conversation which works for both parties. Greggs do this particularly well, welcoming sandwich ideas and then putting them into practice. And the key – don’t be too slick about it. Social media was always intended as user-generated content and brands need to play by the same rules to be authentic and also need to judge if they are actually attracting new fans or merely engaging with consumers who have already been won over.

Twitter is, to an extent, still in the user-controlled stage from which Facebook appears to be emerging. Twitter saw how users dictated the features it wanted from the platform, which led to the creation of features hashtags and retweets. Individuals and brands seem to cohabit more naturally on Twitter, where brands seem less willing to overtly sell to consumers and more content in watching what they say and observing how they act. Perhaps it is this form of engagement that will lead to the happiest online relationship for brands and consumers alike.

Remember when a Kit Kat was really a Kit Kat?

Remember the days when the only decision you had to make when buying a KitKat was whether to get the two-finger snack or go the whole hog on the four finger option. Now, not only is there chunky, chunky duo and king-sized chunky, Kit Kat has been one of the brands leading the way with alternatives to the traditional recipe.

Latest on the ‘caramel trail’ is Aero, which has topped its famous bubbly chocolate with caramel. This is all part of Nestlé’s plans to make a "huge" investment in Aero this year, kicking off with the re-introduction of Aero Caramel. The company is pouring £5m into a four-month media campaign to celebrate the relaunch of the Caramel variant, which was originally introduced in 2004.

The "irresistibubble" product is getting the full treatment from an integrated advertising campaign including interactive touchscreen quizzes at bus stops to its own Facebook page (we’re still not too sure why you’d befriend a chocolate bar on Facebook). Nestlé, which has also launched an Orange variant of its Aero block, recently reported that sales of Aero blocks soared during 2010, up 70% year on year.

This all follows on the back of perhaps the most bizarre – and to be honest slightly unsettling combination - Marmite’s pre-Christmas launch of a creamy milk chocolate bar with a hint of the famous yeasty spread. Unilever, owner of Marmite marketed the bar as a "devious treat for the in-laws" at Christmas or for those struggling to find a present for a loved one.

We love a bit of chocolate just like the next team, but we also have a nagging concern. If you play around too much with a much-loved institution like the good old Kit Kat or Aero, at what point do you begin to forget why you fell in love with it in the first place? At what point does Kit Kat stop being Kit Kat and start being something else that perhaps you don’t like as much? How far is too far and when do the manufacturers stop staying true to the brand they spent so many years building up?

Now, what would be interesting, perhaps Cadbury’s will really go radical with a re-launched Dairy Milk that has added……chocolate?

Water In A Box – Gimmick or Lifestyle Choice?

A few months ago a BBC documentary – “The Foods That Make Billions; Liquid Gold” – explained how, over the last 40 years the bottled water industry had gone from a business that few took seriously to a global industry worth billions.
One point made by the programme was that, with water natural and sourced at minimal cost, the real value to the industry lay in how the product was marketed and branded. After all, why else would you pay money for something that you can otherwise get for free? In a sense the market now has 20 or 30 varieties of something that actually has no variety.
The latest addition to the market – and with its own branding twist – is Aquapax, from Just Drinking Water, which makes a big play of its packaging in a 500ml carton mostly made of wood, which as they helpfully point out is a natural and renewable resource.
The Engage team road-tested Aquapax and wondered what impact – if any – drinking water from a carton in a sector dominated by bottles there would be. Our findings were split between the practical and the emotional.
The first point to make, of course, is that consumers are already used to getting drinks (albeit not water) from cartons, so there should not be a major educational job to be done in convincing the consumer to embrace a carton.

However, those in the team who drank water particularly when exercising were concerned that shape of the Aquapax was just not as ergonomical to hold as a water bottle, whilst some of the ladies in the team were worried about the durability of the carton versus a bottle if they chose to carry one in their bag.

On the more emotional side, clearly the carton appears more sustainable than a plastic bottle. At present, at least, it is achieving some stand-out for the brand in what is a crowded sector and, for those so-inclined, it enables you, the buyer, the chance (in the short term) to stand out from the crowd.

The bottom line, we guess, is that the brand is asking you, the consumer, to buy into an ethos not just a drink. But, when push comes to shove, and with sales of bottled water falling as more people turn on the tap at home and when eating out, we’re not sure that it’s ever going to be anything more than just another drink on the shelf.