Category: + Fairness

When TV Commercials Wink

2/14/2021

by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

As a Seinfeld fan, one of my favorite episodes is when George’s eye catches a piece of flying grapefruit, causing him to confuse everyone with his involuntary winking. Such hijinks are funny for a television sitcom, but what happens when commercials use conflicting verbal and visual cues, particularly on TV’s biggest stage?

Before the recent big game, a friend graciously invited my analysis of the ads—You don’t have to ask twice for my opinion on advertising, especially Super Bowl commercials, so I shared thoughts about one particular ad that seemed strange.

Toyota’s “Upstream” commercial featured the adoption story of Jessica Long, a 13-time gold-medal-winning Paralympic swimmer. Long’s rise to success despite severe adversity was inspiring; however, there was also something unsettling about the ad.

Pushing against the positive verbal messages of parental love and athletic achievement was a literal stream of cold, dark water that ran through every scene, including the family’s home and other indoor places. That’s a disconcerting sight that can cause anguish for anyone, especially those who have experienced floods in their home, school, or work.

The negative visual of flood water worked against the ad’s affirmative verbal messages, significantly diluting the positive affect Toyota likely wanted for its ad, and making it “Simple-Minded Marketing.” The automaker certainly had good intentions, but I doubt the inadvertently somber spot did much to boost the company’s brand.

I remembered this ad partly because of its unpleasant aftertaste but also because I’ve studied such verbal-visual disconnects before. Several years ago, I did research on the same phenomenon found in pharmaceutical ads, which are probably the worst offenders when it comes to sending mixed commercial messages.

When we watch a prescription drug ad, we usually hear a list of the medication’s side effects, which the Food and Drug Administration (FDA) mandates. However, as a narrator recites those potential negative outcomes, the commercial often shows very pleasant visuals, like the ones seen in this ad for Lipitor. At about 33 seconds into the spot, a narrator starts to quickly read several serious warnings:

“Lipitor is not for everyone, including people with liver problems and women who are nursing or pregnant or may become pregnant. You need simple blood tests to check for liver problems. Tell your doctor if you are taking other medications or if you have muscle pain or weakness. This may be the sign of a rare or serious side effect.”

Ironically, the visual backdrop for these weighty words is a guy and his dog taking a pleasant walk through the woods and later jumping into a lake for some swimming fun. Yes, we hear the side effects in such ads, but are we really listening to and understanding their gravity, given that very positive visual scenes distract us from those negative verbal messages?

That’s the question I set out to answer through research that began with a group of students in an Advertising Ethics class I was teaching. In a controlled empirical study that involved commercials for fictitious pharmaceuticals, we found that people do indeed discount drugs’ negative side effects when shown positive “dissonant” visuals at the same time.

I presented those findings at the American Marketing Association’s Marketing & Public Policy Conference in Washington, D.C., where a member of the FDA commended the research and asked for a copy of the presentation. Health Marketing Quarterly later published the study.

So, one “Simple-Minded” Super Bowl ad failed to make effective use of reinforcing, or “redundant,” visuals—no big deal. Actually, several other $5.5 million+ spots made the same mistake in similar ways and in doing so conveniently completed the other three quadrants of the Mindful Matrix:

“Alexa’s Body” - Amazon claimed the steamiest spot in this year’s Super Bowl. For nearly sixty seconds, a female Amazon employee fantasized about handsome Black Panther star Michael B. Jordan, who replaced the smart speaker in her lustful daydreams, which included Jordan removing his shirt and joining her in a bubble bath for two.

The commercial was uncomfortable to watch in mixed company and may have posed problems for parents, but the real issue was the spot’s repeated sexual objectification of Jordan. Role-reversal (a woman mentally undressing a man) may have seemed funny, but no one should be reduced to their body parts or have their personhood downgraded to a “vessel.” Similarly, it’s dangerous to objectify men as doing so suggests that it’s also okay to objectify women.

The ad involved dissonant visuals in that images of a sexy superstar have nothing to do with voice commands about ‘the number of tablespoons in a cup’ or ‘turning on the sprinklers.’ The pairing of an A-list celebrity with Alexa probably has helped keep Amazon’s smart speaker top-of-mind, but all the gratuitous sexual innuendo made the ad “Single-Minded Marketing.”

“Happy” - In its “Ultra” light beer ad, Michelob employed an entire lineup of past and present all-star athletes. For instance, there were still shots and/or video clips of Serena Williams, Mia Hamm, Anthony Davis, Usain Bolt, Billy Jean King, Arnold Palmer, Wilt Chamberlain, Jimmy Butler, Peyton Manning, and more.

I wonder whether Michelob got permission from all these athletes, or their estates, to associate their images with its brand, but assuming it did, there’s still another problem that directly involves dissonant visuals: People don’t ascend to those kinds of athletic heights by downing much beer. There’s little to suggest that alcohol enhances athletic performance; in fact, alcohol has exactly the opposite effect: It reduces aerobic efficiency, impairs motor skills, decreases strength, disrupts sleep, and slows recovery.

Michelob’s suggestion that happiness helps athletes win may have some truth to it, but there’s clearly much more to athletic achievement, namely physical and mental discipline both of which alcohol easily impairs. For that reason, it was irresponsible of Michelob to show images of athletes in uniform, on their courts, fields, etc., along with alcohol-friendly soundbites such as, “fueling the run toward greatness” and “something more vital.”

How ironic and tragic it was that Kansas City Chief’s outside linebacker coach Brit Reid, son of head coach Andy Reid, caused a multi-vehicle accident days before Super Bowl, apparently due to alcohol impairment. The accident caused him to miss the game and left a young girl fighting for her life. Alcohol and athletics definitely don’t mix, and it’s doubtful that such precarious positioning will give Michelob’s brand much boost, which makes the beermaker’s ad “Mindless Marketing.”

“Get Back to Nature” - After the three commercials just described, it’s easy to be suspicious of all Super Bowl spots, believing that most played with consumers’ minds and sacrificed social mores. Thankfully however, the preceding ads were exceptions. Most of the commercials employed redundant, not dissonant, visuals that appropriately reinforced their verbal messages.

One of the best examples of such visual-verbal consistency was Bass Pro Shops and Cabela’s 60-second spot that featured clips of ordinary people planning for and enjoying beautiful places in the great outdoors while hiking, fishing, camping, and more.

Sprinkled into some scenes was gear that one could probably purchase from the outfitter, but none of the product placement was overdone; rather, all subtly and artfully supported the simple call to experience nature. Consequently, viewers were likely both to remember the firm’s ‘enjoy the outdoors’ value proposition and to believe its closing promise, “We’re there for you.”

Bass Pro Shops and Cabela’s commercial wasn’t the only advertiser to hit a home run in terms of verbal-visual consistency that was both effective and ethical. A couple of other best-practices ads belonged to Huggies for “Welcome to the World, Baby” and to Indeed for “The Rising.”

A wink is the epitome of a dissonant visual—it slyly states, “Don’t believe what I’m saying.” Advertisers shouldn’t ‘wink’ with their ads, i.e., use dissonant visuals that contradict their spots’ verbal messages. Instead, commercials should enlist strategically-chosen redundant visuals that reinforce the right verbal messages. In Super Bowl ads and in other communication, that consistency makes for “Mindful Marketing.”

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General Motors – Going Electric, Going for Broke?

2/6/2021

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

There’s news and there’s NEWS. The unexpected announcement that one of the world’s best-known companies, in an indispensable industry, had decided to convert all its product lines to clean energy was shocking NEWS that’s gained public praise. However, is this storied firm making a PR promise that its bottom-line can't bear?

About a week ago General Motors made the stunning announcement that it would “phase out petroleum-powered cars and trucks and sell only vehicles that have zero tailpipe emissions by 2035.” Companies revamp product lines all the time, so what makes this U-turn so extraordinary?

Throughout most of its 113-year history, the gasoline combustion engine has been the driving force inside the vast majority of the automaker’s products. Gas has been to GM like chicken is to KFC. In fact, GM could stand for Gasoline Motors.

GM has long-been known for gas-gulping sedans like Buicks and Cadillacs, as well as increasingly popular pickup trucks and SUVs, including one with one of the lowest MPGs of any noncommercial vehicle in the modern era--Hummer.

Not only has the company been an avid user of petroleum-burning technology, it’s also been a developer. For instance, “In 1971, GM pioneered the use of engines that could run on low-lead or unleaded petrol.”

Meanwhile, this world-leading automaker hasn’t exactly been heading the charge into electric vehicles (EVs). In 2016, Bloomberg estimated that GM lost $9,000 on every all-electric Chevrolet Bolt it sold, and in 2019, the company halted production of its Chevrolet Volt hybrid car. Both of these short-circuits likely contributed to projections that EVs would account for just “5 percent of the automaker’s total production by 2026.”

What’s more, in an effort to promote a gas-fueled future, General Motors joined a Trump administration lawsuit against California aimed at compelling the state to decrease its gas-mileage standards to the lower federal levels.

In short, “General Motors’ history hasn’t been especially kind to electric mobility.”

So, would a company kept afloat for so long by gasoline really want to sever that fuel line?

Given GM’s history and current product portfolio, it’s easy to suspect that the company is simply playing a PR card. Perhaps ‘no petroleum by 2035’ is a stretch goal that the company doesn’t actually expect to achieve, or the objective is just symbolic of the firm’s intent to be more environmentally-friendly.

Companies making such bold long-term projections can take cover in our collective amnesia. In 2035, will anyone remember what GM promised a decade and a half earlier, let alone hold the company accountable?

GM’s current CEO, Mary Barra, has been leading the automaker since January of 2014. Given the five-year median tenure for CEOs of large-cap companies, how likely is it that she’ll be at the helm in 15 years at the age of 74? If there is accountability for GM’s no-petroleum pledge, it probably will fall on one of Barra’s successors. That protection along with pressure for next quarter’s earnings could encourage a leader to promise anything!

However, GM doesn’t really need a confidence-building headline right now—the company is actually doing well. Since a low of $16.80 per share on March 18, 2020, its stock price has tracked steadily upward to its current price of $54.25, making a market cap of $72.54 billion. The company’s trailing twelve months revenues are $115.79 billion with net operating income from continuing operations of $3.39 billion.

Furthermore, many have an optimistic outlook on the firm, including 18 investment analysts CNN recently polled, all of whom gave the stock a “buy” rating. Given the momentum of its existing operations, maybe a better question to ask is: Is GM making a big mistake by promising to sever its gasoline fuel line?

One very good reason for wondering is that GM’s sales are increasingly skewed toward bigger products. In 2019, GM delivered 2,887,046 vehicles in the U.S., of which more than 2 million were full-size pickups, SUVs, and crossovers. Those bulkier vehicles need more energy to move their larger masses, especially if they’re hauling or towing things. That kind of power demand can be hard for battery power to support.

Political uncertainty is another issue. After the Biden administration’s win and call for more clean energy, GM withdrew from the California fuel efficiency lawsuit—a move that seems prudent now, but what happens if the pendulums of politics and consumer sentiments swing back, away from environmentalism, as they’ve done on more than one occasion? Will GM wish it hadn’t made such a life-changing commitment?

It’s reasonable to ask these kinds of questions about the authenticity of GM’s promise and the acumen of its long-term strategy. However, it’s still very likely that the company’s electricity-powered approach is its best path forward, for strategic and moral reasons:

No future in fossil fuels: Each year, more organizations and individuals convert their energy consumption to renewable sources such as solar and wind. Although economic influences like low oil prices may temporarily slow the trend, it will continue, especially with more pro-environment government policies, purchase incentives, and industry innovation, such as Apple’s potential autonomous EV.

Turning an aircraft carrier: Many of the newer EV producers are more nimble than GM because of their smaller sizes, flatter corporate structures, and more risk-tolerant organizational cultures. It typically takes an older, larger company longer to make a significant business model change, especially if the company is not privately held but needs to answer to shareholders.

A planet in peril: In the face of mounting evidence, it’s hard to overlook the negative impacts that CO2 emissions are having on the environment, including its animals, plants, and people. Even if GM could continue to sell petroleum-powered products for another hundred years, moral considerations like fairness to those breathing polluted air and stewardship of limited resources suggest that the company shouldn’t continue production as usual.

As often happens in the auto industry, GM’s changes will have some significant impacts on other companies such as its main suppliers, as well as on thousands of other organizations that automotive touches like service centers, gas stations, and replacement parts suppliers.

However, just as this large corporation’s changes will threaten certain industries, those that respond to the challenge and adapt may find great economic opportunities, like manufacturing batteries and operating charging stations.

GM’s 15-year conversion commitment is a big, bold move, yet it’s one the company needs to make for its own success, as well as for the wellness of our world. Maybe this major player’s actions will inspire others to take similar steps, making GM’s electrical charge even more “Mindful Marketing.”

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Natural Light Imitates Art

1/23/2021

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Often those fortunate enough to earn a college degree proudly display their diploma in their office or another personal location. Now the credentials of one large group of college grads are on exhibit in a much more public place—New York City's Grand Central Terminal. But, at a station known for transportation, is the art’s creator paying homage to higher education or throwing a college degree under the bus?

The intensely competitive alcohol industry has led many beer manufacturers to become very creative marketers: from elaborate point of purchase displays in retail stores to highly produced commercials during Super Bowls. Now the world’s biggest brewer, Anheuser-Busch InBev, has found an especially innovative way to broadcast a brand message—a work of art, in the heart of New York City, valued at $470 million!

The exhibit, called “the Da Vinci of Debt,” is a collection of 2,600 real diplomas that Natural Light, one of Anheuser-Busch’s signature brands, has rented from degree earners. Resembling a blizzard of super-size snowflakes, the white diplomas cascade downward from ceiling to floor of Grand Central Terminal’s Vanderbilt Hall. It’s an installation that’s both impressive in its grandeur and appealing to the eye.

So, what’s behind Natural Light’s foray into ‘fine art’ and its claim to have constructed “the most expensive piece of art in the world”? The company says it wants to bring attention to the burgeoning problem of student debt, which helps explain the firm’s valuation of the exhibit at $470 million--the average total cost of a four-year college education times 2,600 degrees.

As someone who’s taught in higher education for 20 years and paid for two children to attend college, Natural Light’s cost estimate seems right: $470 million divided by 2,600 diplomas is $180,769 per degree, or $22,596 per semester. Unfortunately, this price has risen precipitously over the years, increasingly exceeding families’ abilities to pay, save for significant financial assistance, often in the form of student loans.

To some extent, faculty members like me are responsible for the extreme price up-tick: Employee salaries often represent organizations’ biggest costs. However, higher ed’s steeply-sloped expense history is more complicated.

When those who attended college several decades or more ago visit campuses today, they’re often awestruck by the number and nature of amenities today’s students enjoy: from beautifully-appointed apartments, to state-of-the art classrooms, to expansive sports centers. These expensive and largely consumer-driven upgrades also have contributed to rising college costs.

Regardless, it’s important to affirm Natural Light’s suggestion that student debt is a serious problem. That doesn’t mean, though, that the Da Vinci of Debt is an impeccable piece of art: A real concern is that the exhibit conveys a misguided message: That a college education is not worth its price.

Some may not gather that interpretation from the exhibit, which is good; however, it’s reasonable to believe that many who see or hear about the art will draw the conclusion that those willing to part with their diplomas must feel dissonance about their degrees.

Unfortunately, some do get a less-than-ideal return on their college investments for various reasons that can include choosing the wrong school or major but more likely stems from failing to take their academics seriously—a tragic misstep that’s ironically related to Natural Light. I’ll say more about that and two other 'art ironies' in a moment.

First, it’s important to note that the experiences college students enjoy and the relationships they form are often invaluable, or at least defy quantification. At the same time, some like Georgetown University’s Center on Education and the Workforce have calculated the typical financial payback a college education offers:

A Bachelor’s degree is worth $2.8 million on average over a lifetime.
Bachelor’s degree holders earn 31 percent more than those with an Associate’s degree and 84 percent more than those with just a high school diploma.

So, is a college degree expensive? Yes. Is it worth the cost? Yes, provided that the student properly ‘consumes the product,’ which leads to the three art ironies referenced above.

Irony #1: Most Anheuser-Busch executives hold one or more higher education diplomas.

Here is a partial list of Anheuser-Busch’s U.S. leadership team members and their degrees:

Nick Caton, U.S. Chief Financial Officer: Bachelor of Science in mathematics from Stanford University; Juris Doctorate from Yale University
Agostino De Gasperis, U.S. Chief People Officer: Bachelor of Commerce degree from the University of Toronto
Ingrid De Ryck, U.S. Chief Sustainability and Procurement Officer: bachelor’s and master’s degree in business engineering from the Katholieke Universiteit Leuven
Benoit Garbe, U.S. Chief Strategy Officer: MBA from Harvard Business School
Craig Katerberg, General Counsel: degrees from the University of Chicago and from Northwestern University School of Law
Elito Siqueira, U.S. Chief Logistics Officer: a degree in mechanical engineering; two executive MBAs; completed supply chain programs from the Massachusetts Institute of Technology and Stanford University

This list could include several other Anheuser-Busch executives, with equally impressive pedigrees, all of whom appear on the company’s website. It’s unusual for businesses to mention their leaders’ academic credentials so prominently, which makes Anheuser-Busch’s higher ed highlighting even more unique.

Moreover, given the positions these individuals hold with a firm that ranks #205 in Fortune’s Global 500, it seems that all have gotten good returns on their college and master’s degrees. I wonder if any of them regret the educational expenses they incurred, or if they chose to include their diplomas in the Da Vinci display.

Irony #2: Beer and higher education are notoriously bad partners.

Unfortunately, alcohol abuse on college campuses is legendary: If you haven’t witnessed it personally, you’ve likely seen it portrayed in movies or on TV. I’ve written two other pieces that have highlighted the coed alcohol epidemic:

The first piece questioned Dos Equis being made “The Official Beer Sponsor of the College Football Playoff.” In light of the destruction alcohol has done to so many young lives, I argued that college-related events should never have a “beer sponsor.”

The second piece had a similar theme, but this time the event was graduation and the sponsor was . . . wait for it . . . Anheuser-Busch. Yes, Natural Light was making the same dangerous association of beer and books, attempting to put an intoxicating brand spin on what should be a very meaningful if not solemn ceremony.

I wonder how many people have had their college careers completely derailed by alcohol, or graduated but so frequently missed classes or walked around buzzed that they failed to gain nearly what they should have from their college experience.

Such lackluster collegiate performance correlates with low GPAs and lack of good post-college employment opportunities. I wonder how much alcohol abuse has increased the cost of college and made it more difficult for graduates to pay off their diploma-related debt?

Irony #3: Anheuser-Busch doesn’t mention student debt relief among its social initiatives.

In 2018, to the company’s credit, Anheuser-Busch launched “an annual College Debt Relief program” that annually awards “$1 million to students under financial pressure.” The plan is to pay out $10 million toward college debt relief over 10 years.

Of course, $10 million is a ‘drop in the keg’ compared to the $1.7 trillion level college debt is projected to reach in 2021, but no one company can be expected to do it alone. By the same token, however, Anheuser-Busch had total operating income of over $16 billion in 2019, and in the same year spent $1.53 billion in the U.S. on advertising.

A million bucks a year is a nice donation, yet it does seem somewhat paltry for a firm dealing in billions of dollars. Perhaps that’s the reason Anheuser-Busch makes no mention of education or student debt relief on its social responsibility website page, “Purpose Beyond Brewing.” The one CSR area that comes closest is “Economic Impact,” but that page just describes the company’s commitment to care for employees, support the restaurant and bar industry, and create jobs for farmers.

So, under which of Anheuser-Busch’s expense lines does student debt relief really belong? Is it serious social responsibility or is it a straightforward advertising-spend?

Regardless, I’m not sure how much the Grand Central Terminal art exhibit will make a positive impact for Natural Light. The brand communicates many countervailing messages, such as images on its website that seem more like an ode to spring break in Fort Lauderdale than any serious concern for student well-being. That disconnect and relative lack of exposure may doom Da Vinci.

Admittedly, the author of this piece has an employment-influenced bias in favor of higher education and against alcohol consumption by young people. He’s also not an accomplished art critic. Still, his professional opinion suggests that Natural Light’s Da Vinci of Debt is a monument to “Mindless Marketing.”

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Did Apple Make a Debundling Blunder?

12/21/2020

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

It’s a parent’s classic Christmas morning fail: After having the foresight to purchase the holiday’s hottest new toy, they forget to buy the batteries! By not including a charger with its newest ‘toy,’ has the world’s most valuable brand set up its customers for gift-giving/getting failure?

The introduction of almost any new Apple product, particularly an iPhone, is newsworthy. Even people who don’t buy Apple are interested in the features the firm unfurls in its latest phones. This time, though, it’s what Apple hasn’t included that’s made headlines.

The iPhone 12 packs many impressive features including an A14 bionic chip, an edge-to-edge OLED display, a ceramic shield, and night mode, but consumers won’t find in the box two items they’ve come to expect with any iPhone: EarPods and a charging adapter.

Given that many people are particular about what they put on/in their ears, and some wanting wireless, it’s not surprising that Apple decided to forgo ear accessories with its new phone models. What is surprising, though, is that the iPhone 12 comes sans charger—something everyone needs in order to use the product.

A main reason Apple has omitted the charger is that it believes people already have one, which probably is true for many of those interested in the latest iPhone. At the same time, if someone is willing to pay $800+ for the base model iPhone 12 or $1,000+ for one of the Pro versions, shouldn’t Apple oblige by including a comparatively inexpensive power supply?

Apple’s omission has challenged me to think of precedents for such a strategy, which seems akin to an automaker selling cars without spark plugs. As suggested at the onset, some companies market toys and other low-end electronics with the package disclaimer “batteries not included,” but that’s increasingly rare. Plus, batteries are inexpensive and easy to find . . . at least most are, which reminds me of a shopping experience I had a few months ago.

With both my gas-powered leaf blower and string trimmer on their last legs, I started searching for battery-powered replacements. In the process, I noticed several units labeled “tool only,” which were often priced $100+ less than what looked like the same models. I soon realized that some people only buy the implement because they already have one or more batteries and chargers from prior purchases of tools that use the same power system. For those individuals, the manufacturers’ “unbundling” of the battery and charger from the tool is a big benefit.

We’re used to seeing companies bundle products, i.e., market related items together and, in doing so, offer consumers an overall lower price, e.g., value meals at fast food restaurants, home and auto insurance policies. Unbundling is the opposite: A company realizes that consumers dislike paying for products they don’t want/use, so it deconstructs the bundle and sells products separately, usually at somewhat higher individual prices.

There’s a significant cost difference, however, between power supplies for yard tools and those for iPhones. A battery and charger accounts for about half the price of a yard tool package, while the phone charger represents just a fraction of an iPhone’s cost.

That discrepancy suggests that, unlike most unbundling strategies, Apple’s approach was not driven by consumer’s desire to save money. Lisa Jackson, Apple’s vice president of environment, policy, and social initiatives explained how the company had, instead, sustainability in mind:

"There are also over 2 billion Apple power adapters out there in the world, and that's not counting the billions of third-party adapters. We're removing these items from the iPhone [12] box, which reduces carbon emissions and avoids the mining and use of precious materials."

Apple’s website elaborates on the environmental ends the company aims to accomplish by omitting the iPhone 12 charger:

Carbon savings equal to 450,000 fewer cars on the road per year
Reduced mining and use of precious metals
A smaller phone package, allowing more boxes per shipment and fewer overall shipments
The elimination of 2 million metric tons of carbon emissions each year

Those intentions are certainly admirable. It’s questionable, though, if that projected positive environmental impact will actually occur, given that consumer behavior will likely adjust as a result of the iPhone 12 coming without a charger.

Of course, some iPhone 12 buyers won’t have a workable adapter and will have to buy one, either from Apple or a third party. However, even if customers already own a serviceable power supply, they still might decide to buy a new one for one or more of the following reasons:

If they sell or gift their old iPhone, the recipient will probably want the charger.
It can be convenient to have more than one charger (e.g., one for home, one for work).
Consumers don’t usually want to use old accessories with new products. For instance, few people want to put used tires on a new car or old laces in new shoes.
The old chargers are not completely compatible with the newest iPhones. Although one can connect an iPhone 12 to an old power adapter using an old lightning to USB-A cable (the USBs with the large, wide connectors), the new iPhone won’t charge as fast as it will by plugging the included lightning to USB-C cable (small, compact connector) into a new adapter, purchased separately.

In sum, many people will still want or need to buy an adapter, which “will now need to be packed and shipped separately from the phones, thereby increasing the environmental consequences.”

The change in buyer behavior is coupled with the fact that chargers from smartphones, tablets, etc., account for a very small percentage of all e-waste. Ruediger Kuehr, head of the Sustainable Cycles (SCYCLE) Programme hosted by the United Nations University, estimates that Apple’s move could save at most 25,000 metric tons, or .05 percent of annual e-waste.

Granted, any e-waste avoided is a good thing, but the packaging and transportation costs from secondary market charger sales could erase some or most of the environmental gains of keeping the charger out of the original package.

Apple is an environmentally-conscious company with a continually-improving track record for sustainability, which includes reducing toxic components in its hardware, nearing 100% use of recycled materials in its phone manufacturing, and aiming to be carbon neutral by 2030.

Still, omitting an iPhone 12 charger doesn’t promise to be the “boon to the environment” that the company has suggested.

Apple’s unbundling was likely well-intended, but the reality of little environmental impact and negative consumer reaction, makes the strategy a case of “Simple-Minded Marketing.”

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Do We Really Want State Farm’s Rodgers Rate?

12/12/2020

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

“How much does it cost?”—That’s often the first question consumers ask and one that companies like to avoid until after they’ve described their products’ features and benefits. A leading insurance company, however, has decided not only to buck that communication wisdom but to promote another precarious pricing strategy.

Market research apparently pegs football fans as key consumers of insurance, which would explain why televised games contain so many commercials for the likes of Liberty Mutual, Geico, and Progressive. One of the biggest buyers of advertising inventory has been State Farm, whose ubiquitous ads feature a couple of top National Football League (NFL) quarterbacks expressing gratitude for scoring special insurance deals.

In the ad campaign, Super Bowl champions Aaron Rodgers and Patrick Mahomes take turns conversing with casually-cool insurance agent, “Jake from State Farm,” who sports some stylish stubble, a snug-fit State Farm t-shirt, and the obligatory khaki pants.

The sports stars convey gratefulness to Jake for landing them 'exclusive' insurance deals. In one ad, Rodgers plays fetch with his dog while thanking the representative for giving him “the Rodgers rate” on his insurance, which Jake firmly denies:

“Here’s the deal. There’s no Rodgers rate. State Farm just has surprisingly great rates.” “We do offer it to anyone, literally anyone.”

Jake has practically the same conversation with Mahomes in a similar spot, as the two play corn hole. Like Rodgers, Mahomes thanks Jake for the “Patrick Price” on his insurance, but again, the agent resists:

“Here’s the deal, Patrick. State Farm offers everyone surprisingly great rates.”

At first glance, it seems like State Farm’s pricing play could work. In a celebrity-centered, influencer-driven world, people love to eat, drive, and wear what famous people do. So, why not add insurance to the list of endorser-inspired products?

The company’s ‘one-rate-for-all’ ads also could appeal to a value for of equality by suggesting that everyone should be able pay the same prices for the same products. Of course, charging people different prices would be unfair . . . or would it?

Legally, organizations can’t charge certain consumers more because of personal traits like gender and race. In terms of moral principles, it would be unfair to give more favorable treatment to some people and not others because of such characteristics. However, there are some legitimate reasons for price discrimination, for instance:

Quantity Discount: People who purchase more deserve to pay lower unit prices, e.g., buying a six pack of soda versus a single can.
Lower Risk: Individuals who objectively are less likely to default on credit terms should receive more favorable rates, e.g., a person with a very good credit score who puts a 50% down payment on a home versus another with a low credit score and 20% down.
Buy Now: Because of the time value of money, as well as companies’ needs to maintain cash flow and reduce inventory, consumers often receive incentives for purchasing sooner rather than later.
Peak Demand: Many people want to do the same activities at the same times, like going to the beach in the summer and to the movies in the evening, which is why hotels offer off-season rates and theaters have matinees.

There’s one other reason for price discrimination that’s not as clear cut—ability to pay. On one hand, companies shouldn’t be like the mechanic in National Lampoon’s Vacation: When Clark Griswold innocently asks him how much his car repair costs, the unscrupulous repairman boldly asks, “How much you got?” then demands “all of it, boy.”

On the other hand, it seems compassionate to charge specific consumer groups less because of their typically lower incomes, e.g., senior citizens.

In the industry in which I work, higher education, price discrimination is routine practice. Government and a variety of organizations collaborate with colleges and universities to offer tuition-lowering aid financial aid and scholarships, particularly to families with the greatest need.

That brings us back to Rodgers and Mahomes. Perhaps as spokesmen they receive State Farm insurance for free, but if they are paying something for it as the commercials suggest, these two multimillionaires certainly wouldn’t be getting a break on their rates because of inability to pay.

According to NFL.com, Mahomes’ $45 million a year salary is the league’s highest, and Rodger’s $33.5 million annual take is not far behind. Companies of all kinds strive to win the business of such high equity individuals, largely because they can afford full fare, i.e., they don’t require discounts.

Although you and I are less affluent, we understand that dynamic and wouldn’t want to pay the prices that Patrick and Aaron pay for anything. Hook us up, instead, with the rates their chauffeurs and gardeners are getting.

Of course, the commercials are meant to be funny, and we shouldn’t pretend we have the same buying power as NFL quarterbacks. Still, State Farm appears serious about uniform pricing by repeatedly suggesting that it offers “surprisingly great rates” to everyone without exceptions. That fixed pricing is the main flaw of the firm’s strategy; in fact, it’s a mistake from which one well-known retail chain is still struggling to recover, years later.

In November of 2011, JCPenney made a bold move in hiring as its new CEO former Apple retail executive Ron Johnson. In his effort to make JCPenney more Apple-esque, Johnson upgraded the stores' interiors and, more significantly, implemented Apple’s everyday ‘value’ pricing. If the no-sales strategy worked for the world’s most sought-after electronics brand, it should work for a clothing and housewares retailer, right?

Unfortunately for Johnson and JCPenney the strategy failed miserably. The firm’s revenue fell by almost $5 billion in one year and its operating loss grew to nearly $1 billion. Johnson was ousted from his job in March of 2013, just 14 months after he started.

The main failure in what some have called “the biggest retail disaster in history” was forgetting that people love sales. Many of us are captivated by the ‘thrill of the hunt,’ and we relish knowing that we got a great deal, whether it be versus regular prices or in comparison to what others have paid. I’m one of those people who is not above bragging about his consumer conquests.

A few years ago when gas prices were on the rise, I shared a fill-up receipt with my wife so she could see how I paid a paltry $1.78 per gallon thanks to an abundance of grocery store reward points. Then, just this past week, I saved 43% on purchases at a drugstore chain thanks to various special discounts stacked atop a 30% off everything coupon. I hadn’t told anyone about that shopping feat, but I’m bragging about it now!

It’s not just me. Over the years, I’ve heard many others describe their exceptional purchases, a behavior I believe equity theory helps explain. As humans, we continually measure our inputs against their outcomes, including what we spend versus what we get for our money. We’re also constantly comparing our input/outcome ratios to those of others in order to gauge how well we’re doing at shopping or anything else.

Although usually effective, offering sales or running specials doesn’t work in every situation. For prestige products that command premium prices, like those of Apple, it can be counterproductive to offer frequent discounts, as doing so can diminish the brand’s perceived quality and cachet. However, in cases involving little or no product differentiation, businesses that ignore discounting often do so to their detriment.

Many insurance companies do offer discounts for things such as safe driving and bundling multiple policies (e.g., home and auto). In fact, State Farm is one of those firms; it offers a “Drive Safe and Save” discount of up to 30% on auto insurance. For some reason the company gives that program much less media exposure.

Aside from promoting or not promoting discounts, State Farm doesn’t help its cause by suggesting that all its customers pay the same rates whether they’re a multimillion-dollar quarterback or a more frugal football fan.

Price equality sounds nice, but there are legitimate reasons for charging people different prices, including allowing consumers to self-select and shop for prized discounts. At the end of the game, charging everyone the Rodgers rate really is “Simple-Minded Marketing.”

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Can Google Be Trusted?

11/27/2020

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Ask people their biggest brand loyalties and they’ll mention names like Apple, Coca-Cola, and Nike. Flying under the radar, however, is a firm whose product most people use far more often. It’s second nature to ‘Google’ any online search, but does a company the U.S. Department of Justice (DOJ) accuses of anticompetitive practices deserve so much of our trust?

The DOJ recently levied an antitrust lawsuit against Google, “alleging that the online giant engaged in anticompetitive conduct to preserve monopolies in search and search advertising.” Although the lawsuit implies a lack of trust, “The trust in antitrust [actually] refers to a group of businesses that team up or form a monopoly in order to dictate pricing in a particular market.”

Given that Google doesn’t charge people to use its search engine—it’s free for all—it doesn’t make much sense to say that the company colludes with competitors to fix prices.

On the other hand, Google’s inordinately large share of the market for online search, does resemble a monopoly. According to 2017 Net Market Share statistics, Google accounted for 79% of the global search engine market versus just 7.3%, 7%, and 4.9%, respectively, for Bing, Baidu, and Yahoo.

Contrary to what one might think, a monopoly is not necessarily illegal. According to the Sherman Act, it’s fine for a company to hold such a position of prominence, provided that the firm’s “vigorous competition and lower prices [took] sales from its less efficient competitors.” It’s kind of like saying, ‘It’s no crime to be rich, if you made your money honestly.’

Google’s rise to the top appeared to be upright. In 1995, with the Internet in its infancy, Larry Page and Sergey Brin conceived the search engine from their Stanford University dorm rooms. Then, as companies and consumers increasingly spent time online, the firm kept improving its product and riding the wave of web success. Google now has annual revenues of $166 billion and a market cap of $1.20 trillion.

So, if Google’s free product precludes price-fixing and its rise was above reproach, how has the search engine giant run afoul of the law? It has to do with what the company has purportedly done to maintain its preeminent position.

According to the DOJ’s antitrust lawsuit, Google is guilty of acting anticompetitively in search and search advertising in order to “preserve” its monopolies in those arenas. In other words, it’s not what the company did to get to the top, it’s what the firm does to stay there.

It’s important here to reiterate that so far Google has not been found guilty of wrongdoing, it’s only been charged. That said, why would a company that achieved such success honestly, need to resort to maleficence to maintain its status?

As hard as it is to come by success, staying successful can be even harder, for reasons like these:

Success breeds competitors. When people see someone being successful at something, a natural tendency is to think, “I can do that.”
Everyone guns for the leader. In sports, subpar teams often play great games when they have an opportunity to beat the defending champion.
Bigger businesses have more to manage. Even a small company is not easy to run. As an organization grows, so do the number and size of its challenges
Good ideas are hard to find. It’s difficult to maintain a continual flow of winning ideas.
Success is addicting. Once you get a taste of success, it’s hard to give it up.

Of course, none of these reasons would absolve Google of anticompetitive practices. If it’s doing what the DOJ alleges, Google is not only breaking the law, it also may be hurting consumers like you and me in more than one way:

Costing us money: According to the DOJ, enforcement of antitrust laws like the Sherman Act, the Clayton Act, and the Federal Trade Commission (FTC) Act “saves consumers millions and even billions of dollars a year.” It’s basic economics: Greater supply means lower prices.

Reducing quality: The FTC also maintains that monopolies impinge on product quality. When customers have no other options, there are fewer incentives for monopolizing organizations to make sure their offerings are great.

In the abstract, these two reasons definitely resonate. The issue, though, is that my positive experience with Google makes it hard for me to pin either of the problems on the company.

Just in writing this piece, I used Google at least a dozen times to search the Web for articles and statistics that I’ve hyperlinked throughout the article. Those searches are in addition to a dozen more Google searches I do each day for work and personal needs. All these searches cost me nothing and I am almost always very happy with the results. So, why isn’t a bigger, more powerful Google better?

Perhaps the biggest downside of monopolies is that they can impede innovation. Companies with monopoly power can lose incentive to innovate, while standing in the way of other firms that would like to offer us cutting-edge products and breakthrough services.

In a monopoly-managed industry, what’s available may seem good because we’re unaware of what could be, i.e., we don’t know what we’re missing.

What if Microsoft had short-circuited the rise of Apple or if big automakers had put the brakes on Tesla? The world wouldn’t be enjoying the innovative products that these firms and other one-time startups have brought to market. I wouldn’t be typing on my MacBook right now.

Competition is good for consumers. It’s also good for the firms competing, as it encourages them to work more efficiently and effectively, which brings out their best: “Iron sharpens iron, so one person sharpens another” (Proverbs 27:17). Every individual and organization should want to do/be their best and, therefore, should welcome competition.

It will be up to the U.S. District Court for the District of Columbia to determine whether Google has been “unlawfully maintaining monopolies through anticompetitive and exclusionary practices in the search and search advertising markets.” However, if the Court does uphold the charges, the company also could be cited for “Single-Minded Marketing.”

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Moving Aside To Let Consumers Drive

10/17/2020

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

It was a frightening experience. After driving around the parking lot for a few hours, we turned onto the main road, which I had been on many times before, but now 40 mph seemed like 80, and my whole body tensed as cars whizzed by in the opposite direction. I was afraid because I was a passenger, teaching one of our children to drive. I wasn’t in control of the car, they were. I wonder if Ocean Spray has felt similar fear during its rapid TikTok ride.

In a social-media-driven world, marketers increasingly face a dilemma: Should they keep communication control or slide into the passenger seat and allow someone with no professional experience and little company commitment drive their promotional strategy? That’s the question Ocean Spray has had to answer as a longboard-riding, selfie-stick-toting Idaho potato worker unexpectedly drove the firm into pop culture prominence.

Nathan Apodaca wasn’t well-known before he posted the 25-second TikTok clip of himself skateboarding to work, while lip-syncing to the Fleetwood Mac classic “Dreams,” and sipping from a 64 oz. bottle of Ocean Spray cranberry juice. However, the video went viral, gaining over 46 million views and almost 8 million likes, while also grabbing mainstream media attention from the likes of CNN to NPR.

Meanwhile, the cranberry cooperative from Middleboro, MA must have been asking itself, “What just happened?” and “How do we handle it?”

When you think of food companies with conservative product lines, there aren’t many more staid than Ocean Spray. It’s not Nantucket Nectars or Snapple with their overabundance of very creative drink concoctions. The majority of Ocean Spray’s juices, as well as many of its other products contain cranberries, which seem positioned somewhere between raisins and prunes and probably appeal more to ‘mature’ than to youthful palettes.

Case in point, I’m a member of Gen X whose beverage repertoire happens to be boring—I drink little besides water, but I do have a glass of Ocean Spray Cran-Grape juice every day. All that to say, I suspect much of the company’s revenue comes from other mundane middle-agers-or-olders like me. I doubt those in Ocean Spray’s target market are heavy users of TikTok, which makes the firm’s reaction to its sudden social media fame even more remarkable.

However, Ocean Spray didn’t jump on Apodaca’s longboard immediately; instead, it ‘took a beat’ for over a week, which in social media time can seem like an eternity. Still, positive public reaction suggests that the company’s move was ‘lit’—not sure if I’m using that term correctly.

The firm first did its homework and found that Apodaca wasn’t simply someone aiming for internet fame or a corporate payday. He was a hard-working father, living in a mobile home, whose pickup truck died on the way to his job at the potato factory. Rather than miss work, Apodaca pulled the skateboard from his truck, jumped on and, with hydration in hand, began cruising toward the plant. Videoing himself was a spontaneous thought, brought on by the “Dreams” tune and a desire to capture the uniquely ‘chill’ moment.

Ocean Spray, in turn, captured the hearts of the nation and beyond by gifting the stunned Apodaca a new cranberry red Nissan pickup truck, packed with a generous cache of the company’s products.

Meanwhile, TikTok parodies have proliferated. Those grabbing a bottle of Ocean Spray and skateboarding to the sound of “Dreams” have included legendary Fleetwood Mac drummer Mick Fleetwood, Ocean Spray CEO Tom Hayes, and lieutenant governor of Montana and governor candidate Mike Cooney.

From surprising Apodaca with a new truck to filming their CEO’s own TikTok tribute, it seems like Ocean Spray did everything right, but one could also argue that the company was living dangerously by jumping on the TikTok longboard, for three reasons:

1. Skateboarding Spills: From the first time I saw Apodaca’s TikTok, I wondered about the safety. Since my own skateboarding experience was very limited and decades ago, I ‘let it ride,’ until I had an opportunity to ask those in a college class their opinions.

One student, Jordan, said he uses an E-skate (electric skateboard) to commute to campus. While he acknowledged the freedom that some enjoy from riding unencumbered, he was quick to call Apodaca’s approach “ill-advised” because of: multiple distractions (juice, music, camera), no protective equipment, and proximity to fast-moving traffic. He also showed a nasty scrape he sustained from a recent spill, even while wearing a helmet and reinforced leather gloves.

But, why should Ocean Spray worry about any such accidents? It would be tragic to read the headline: “Car Kills Teen Doing Ocean Spray TikTok Parody.” Yes, people will mimic Apodaca regardless what Ocean Spray does, but the company’s support of the viral celeb and its own CEO's imitation could be construed as support for the act and its disregard for danger.

2. Unknown Endorser: Most of the time, famous spokespeople work out well for their sponsors, largely because celebrities are ‘known commodities’ who have been living in the public spotlight for years. Even then, though, there are times when a celebrity’s poor choices sour the promotional partnership, e.g., Olympic swimmer Ryan Lochte in Brazil.

When an ordinary person suddenly rises from obscurity to become the face of a brand, there is increased risk related to an unknown history and uncertainty how he/she might act going forward, both of which could lead to another very undesirable headline, e.g., “BREAKING NEWS: Ocean Spray Spokesman Apodaca . . .”

3. Brand Confusion: In keeping with the prior point, brands carefully choose their spokespeople and dozens of other identity-defining elements in order to position themselves precisely where they’d like to be in consumers’ minds relative to the competition. Allowing whoever happens to shoot a viral video of themself become the face of one’s brand seems like a pretty nonstrategic approach.

If Ocean Spray wants to move its image in the direction of ‘younger,’ ‘carefree,’ and possibly even ‘irreverent,’ the TikTok tie-in works. If not, embracing the viral video could create some cognitive dissonance when consumers attempt to interpret it in light of the company’s other marketing communication.

However, the three cautions above must be interpreted against the reality that Ocean Spray really had to do something. Not acknowledging the viral video would have made the company seem ungrateful, not to mention completely out of touch.

Even though Ocean Spray didn’t ask for Apodaca’s promotional help, the right thing to do was to reward him for the enormous exposure he created for the brand. When someone shows you kindness, you thank them; and, if you’re a company with the resources of Ocean Spray, you do more.

In deciding how much gratitude ($$$) to show, company management may have wondered whether the Tik Tok-driven sales uptick would last. As parodies focus on other things, the firm’s revenue will relapse, but probably not entirely. Some of its newly-won market share may last, as operant conditioning suggests: At least some people who never had Ocean Spray before shooting their own video probably tried it, liked it, and will buy it again.

Similarly, the entire Tik Tok episode may have the effect of lowering the bottom end of Ocean Spray’s age demographic, which is something almost any brand would like. At some point, every organization must appeal to the next generation; otherwise, it goes to the grave with an ever-aging target market.

Still, were these rewards worth the three risks outlined above? My cautious answer is—Yes.

First, the idea of Ocean Spray implicitly endorsing Apodaca’s somewhat dangerous ride is mitigated by the fact that his truck broke down and he was just trying to get to work. It wasn’t a thrill ride for the sake of social media shares. Plus, company CEO Hayes and others have modeled safer and still-satisfying Tik Tok tributes.

Second, should anything unseemly surface from Apodoca’s past or taint his future brand ambassadorship, Ocean Spray could easily pull the plug on the affiliation. Likewise, knowing Apodaca’s situation and the impromptu circumstances under which the relation was formed, the public probably would give some grace to both the individual and the organization.

Third, most of the people who could potentially experience brand confusion from Ocean Spray’s positioning pivot probably aren’t on Tik Tok anyway. That media/demographic separation combined with what will likely be a relatively short shelf-life for the video, should mean that traditional perceptions of the brand remain largely intact.

I still enjoy the control of being behind the wheel. I don’t mind, though, when someone else drives, as long as I feel safe and I have some input into where we’re going. Marketers increasingly need to know when to slip into the passenger seat, yet continue to influence the way to the destination, all while someone with less promotional experience drives.

Like Ocean Spray, those who can successfully navigate that unique balance are on the road to “Mindful Marketing.”

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Capri Sun Practices Child’s Play

9/5/2020

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by David Hagenbuch, founder of Mindful Marketing & author of Honorable Influence

Have you ever been food pranked? Someone gives you something to eat and “Yech!” it turns out to be much different than you expected—toothpaste inside an Oreo is a classic gag. Kids love to prank each other, but should the maker of one of the world’s most popular kids’ drinks fool its biggest fans?

Capri Sun, internationally-renowned producer of juice pouches, has decided to prank not just a few kids but a big portion of its target market by filling select silver packages with water. The company filmed reactions of several pint-sized punk’d consumers, who were given unmarked pouches and asked to test “a new flavor” of juice. It then edited the outtakes into a few video promotions.

Compared to most food pranks, which often elicit expressions of disgust, the responses to Capri Sun’s ruse were rather subdued. Perplexed young taste testers made comments like, “It’s very plain,” “tastes a little bit bland,” and “it doesn’t have any flavor.”

What made Carpi Sun’s prank poignant is that the company’s juice pouches are familiar to so many. Since its introduction in Germany in 1969, the company has expanded distribution of its drinks to 119 countries. According to its website, “ In 2014, our fans all over the world drank 6 billion pouches of Capri-Sun!”

One significant serving of drink sales have come from the greater Chicago area, where Kraft Heinz acts as distributor and a newly-formed advertising firm, Mischief at No Fixed Address, produced the prank. The campaign’s full scope includes distribution of five million filtered water pouches labeled, “We’re sorry it’s not juice,” to Chicagoland schools for free. Also appearing prominently at the top of each package is “Capri Sun” in 70-point all capital letters.

Given the immense physical, mental, and financial stress the pandemic has placed on kids and their parents, it’s kind of Capri Sun to help schools, where fountains are shut down and children need other ways of getting water. But, will the company’s corporate social responsibility really remedy that problem, and what’s likely to be the long-term impact on the brand?

According to the U.S. Census Bureau, the city of Chicago, not including the greater metropolitan area, has a population of 2.69 million, of which 21.2% are under the age of 18 and 6.5% are younger than five. Those stats suggest that there are nearly 400k school-age children in Chicago (570,280 - 174,850 = 395,430).

Providing all of those children with a drink a day for a week would mean 1,977,150 water pouches. A full month of water would entail a total of 7,908,600 (2.9 million more than Capri Sun’s pledge). Keeping kids hydrated from September through December would require about 31,634,400 pouches.

Of course, no one company should be expected to satisfy so much demand for free. Meeting massive public needs tends to take a team effort—collaboration among the public sector, for-profit companies, and other organizations.

Still, although it may seem cynical or even ungrateful, it’s reasonable to wonder whether the social impact of Capri Sun’s philanthropy is proportional to the promotional benefits the firm may receive: Do a few drinks of water warrant the brand splash in front of hundreds of thousands of captive young consumers?

When a company gives away something significant, it’s fair for its brand to benefit. However, the amount of that benefit should be on par with the amount of social good done. The rationale is analogous to a firm needing to ante up millions of dollars, not thousands, for naming rights to a building or stadium.

It’s hard to know Capri Sun’s costs in producing and distributing five million pouches of filtered water, but an estimate of .10 per packet would put the total cost at $500,000. That’s a significant spend, but not that much for a firm with annual revenues of about a half billion dollars. A few other issues further complicate the equation.

First, Capri Sun’s promotional benefits might be multiplied in that it seeks to put pouches with its name into the hands of the most impressionable of consumers—children. Kids are understandably less discerning of promotional messages than are adults, which is why the Federal Trade Commission (FTC) prioritizes protecting children.

Second, it seems that there should be some subtraction from the social good Capri Sun portends because of the message emblazoned on the foil pouches: “We’re sorry it’s not juice. [It’s just] Filtered Water.”

Is Capri Sun dissing in front of kids one of the most important substances for human existence? Of course, the company is trying to be funny. There is, however, the unhumorous reality that many children consume far too much sugar, much of it coming from sugary drinks. (1) To its credit, Capri Sun Fruit Punch contains a relatively low 13 grams of sugar. That’s not much compared to some drinks, but it is high compared to water.

Then, there’s an even more intriguing twist . . .

On August 5, the Chicago Sun Times announced major Lori Lightfoot’s decision to close Chicago Public Schools due to worsening coronavirus conditions—the city’s children will be learning online. That news would seem to punch a hole in Capri Sun’s water pouch plans; however, over two weeks later, on August 21, an AdAge editor’s pick article described the campaign with no mention of the district’s pivot away from in-person education.

Maybe AdAge missed the mayor’s announcement, or perhaps Capri Sun has found another way to distribute the water without access to kids in classrooms. Assuming the later, there’s still one more potentially serious flaw in Capri Sun’s ‘Got Juice?’ strategy:

By associating its iconic packaging with a less desirable drinking experience, the company risks leaving a bad taste in the mouth of young, impressionable consumers.

Can you imagine sipping a Starbuck’s coffee and discovering it was only warm water, or biting into a Hershey’s Bar and finding it was sans-sugar? It’s doubtful either company would intentionally give even one consumer such an indelibly unpleasant experience, let alone broadcast the negative reaction for millions of others to see and learn from vicariously.

As suggested at the onset, a large part of Capri Sun’s food prank success was the fact that so many people, including children, recognize the straw-impaled drink packs and associate them with sweet refreshment and other pleasant sensations. Those positive associations can be easily washed away, though, by even one unfavorable brand encounter that one experiences him/herself or sees others endure.

Of course, a natural retort is, “It was just a joke!” That’s true, and the prank itself was kind of funny. However, there are some things that food and drink companies just don’t joke about, a main one being the taste of their products. Any such negative association is too risky.

It’s a little like when Watergate-embroiled president Richard Nixon infamously declared, “I am not a crook.” Regrettably for him, many people forgot the words “I am not” and remembered Nixon and “crook.” Any negative frame is inherently precarious, particularly when it involves food.

Advertising humor can be very effective, and who loves to laugh more than kids? However, although Capri Sun’s water switcheroo may have been well-intended, the campaign threatens to spill much of the brand equity the drink maker has built over fifty-plus years, making “I’m sorry it’s not juice “Simple-Minded Marketing.”

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Too Attached to an App?

8/10/2020

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by David Hagenbuch, founder of Mindful Marketing & author of Honorable Influence

Of all the dangers facing the United States—natural disasters, terrorism, racism, a global pandemic—who would have thought a social media app would be mentioned among them? China's TikTok has aroused the ire of the Trump administration because of its apparent threat to national security, but is addiction to the app an even greater cause for concern?

For the past year or more, TikTok has been on my radar screen, mainly because I try to keep tabs on what’s trending with the Gen Zs I aim to engage. Last fall, the topic of the hugely popular social media app came up in one of my marketing classes, which inspired me to ask the question: “Should I be on TikTok?” Several students immediately yelled “Yes!” while a seemingly equal number shouted “No!” I wondered if either group had my best interest at heart.

Still not a user, the app gained more of my attention throughout the spring as several of its most popular videos made their way into mainstream media and marketers began talking of TikTok strategies. Meanwhile, accusations of Chinese spying surfaced, and at least one U.S. firm asked its employees to remove TikTok from company mobile devices.

President Trump then threatened to ban TikTok, only to reverse course a few days later when global tech icon Microsoft indicated interest in buying the meteoric app. Most recently, the President signed an executive order that will result in barring TikTok from the U.S. market unless an American company buys the app, which has led parent company ByteDance Ltd. to sue the administration.

Each of these intriguing developments has kept me on the edge of my seat, wondering what will happen next, but no news sparked my interest as much as a blurb in an August 4th email blast from marketing tech guru Shelly Palmer, who stated that “TikTok is already near (or at) the top of the list of the most addictive [emphasis added] social media apps.”

Surveillance by a foreign state has seemed like TikTok’s biggest threat, but is Americans’ addiction to the app an even greater concern?

To answer this question, it’s essential to understand exactly what TikTok is, as well as what it’s so rapidly achieved—some of us above a certain age may need a primer. Steve Wright of Learn Online Video offers a nice overview of the app. He shares a few of its endless stream of 15-second videos, in which their usually young creators often dance and/or lip sync to popular songs. Wright describes the content, which is extremely varied, as “a smorgasbord of [the most] weird, creative, amazing, bizarre videos I’ve ever come across.”

Apparently many find the eclectic selection of “simple, goofy, irreverent” videos appealing. Since its launch in 2017, the app has been downloaded more than a billion times. According to Liv Benger, writing for Medium, “over 682 million people downloaded TikTok in 2019 and [spent] an average of 50 minutes a day” using it.

Those stats certainly suggest rapid growth and near saturation of specific population segments, but do they actually indicate addiction? Most of us know how hard it can be to put down our smartphones or other devices and stop checking email, playing games, texting friends, etc. For some people, those behaviors become compulsive, but do they really rise to the level of addictions?

According to Cornell student Niko Nguyen, the answer is ‘yes.’ In February, The Cornell Daily Sun published an essay in which Nguyen described that the main reason for his difficult decision to delete his TikTok account was that he had found himself “sucked into its addictive grasp.” He went on to explain why he believed TikTok is addictive:

“The app itself is designed to keep us glued to our screens. With most other social media platforms, the majority of content is derived from accounts that you follow. And although you can follow and “friend” a lot of accounts on Instagram, Facebook, Twitter and Snapchat, there’s eventually a point where all the “interesting” content runs dry. With TikTok, that isn’t the case.

Nguyen’s explanation might sound like someone at a buffet who can't stop filling his plate because, “Everything tastes so good.” In that case, we’d probably tell the patron he needs to control his own eating; we wouldn’t blame the restaurant for his overindulgence.

TikTok, however, isn’t the 'typical ‘restaurant.' It uses something that most other apps don’t, at least not in such a sophisticated way. Nguyen alludes to that something, which several others identify directly: artificial intelligence (AI).

Palmer, mentioned near the onset of this piece, is one person who claims AI is at the root of TikTok addiction. He says, “TikTok is a remarkably sophisticated AI model that literally tunes itself to your behaviors with a single goal: addicting you to TikTok.”

Others have further unpacked how AI might accomplish that objective. In a New York Times article, John Herman identified the technology underlying each TikTok user’s very personalized For You page as “an algorithmic feed based on videos you’ve interacted with, or even just watched.”

Unlike other social media in which users have a significant say in the content they receive by virtue of who they friend or follow and what those people post, TikTok’s AI notes what users actually like to watch, regardless who shared it, then sends them more of the same, making TikTok “more machine than man.”

A piece in Fixing Port supported the same assertion: “The TikTok algorithm can be blamed for this [addictiveness] to an extent. The algorithm sees what type of content you are watching (particular uploaders, particular genres, etc.) and then customizes the upcoming content to that liking.”

In The New Yorker, Jia Tolentino detailed her own ‘addiction’ to the AI-driven app:

“I was giving TikTok my attention because it was serving me what would retain my attention, and it could do that because it had been designed to perform algorithmic pyrotechnics that were capable of making a half hour pass before I remembered to look away . . . The algorithm gives us whatever pleases us, and we, in turn, give the algorithm whatever pleases it. As the circle tightens, we become less and less able to separate algorithmic interests from our own.”

In her article on Medium, Benger identified a psychological phenomenon, random reinforcement, that explains more precisely what TikTok users experience: Although not every video provides the same level of reward, like playing a slot machine, the periodic payouts come often enough that users keep pulling the lever/swiping their screen because the next clip could be a real winner.

The way TikTok employs AI does seem to put the app in a different category in terms of possible addiction. Whereas traditional methods of generating engaging content eventually run dry, the app’s AI-based video selection seems to know consumers better than they know themselves, allowing an endless array of just-often-enough, captivating content.

Notwithstanding these authors' insightful analyses of the app, two important and closely-related questions remain that none has appeared to answer:

What exactly is addiction?
Just because something is enjoyable, is it addictive?

Most people would likely easily answer the second question, ‘No,’ as there are many things that are very enjoyable to consume (i.e., eat, use, do) that are probably not ‘addictive,’ for instance: take-out from a favorite restaurant, a round of golf, a concert, ice cream!

Over the years, I’ve often written about potentially addictive products, some of which have included:

In researching to write these and similar pieces, a few things I’ve learned are:

People tend to play fast and loose with the word addiction.
Genuine addictions tend to occur in relatively large percentages of the population, not with just a few people.
There are specific clinical criteria for classifying substances and other things as addictive:

- an overpowering need
- a tendency to increase consumption
- a psychic dependence.

Although it’s common to hear people say things like, “That cake is so good; it’s addictive,” it’s unlikely that any of the clinical characteristics of addiction apply to eating cake. For these reasons, when I wrote the blog posts above, I concluded that numbers 1-4 are often true addictions, while Numbers 5-7, though problematic for certain people, really aren’t.

TikTok, seems to fit best with the second set of products as a non-addiction. That doesn’t mean that the app isn’t a time sink for some, or that it doesn’t present other potential problems. Most people, however, likely can control their use of the app by setting time limits and mustering some will power. Also, as Nguyen showed, it’s not that hard to close one’s TikTok account—it’s certainly much easier than dealing with a drinking problem or stopping smoking.

TikTok appears to provide its target market with inexpensive entertainment while also inspiring creativity and collaboration among users. Although some of us may not understand its appeal and there could be other issues with its content or use, at this point the app should be ‘swiped up’ as "Mindful Marketing."

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Should People Be Mascots?

7/21/2020

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by David Hagenbuch, founder of Mindful Marketing & author of Honorable Influence

After evading public pressure for decades, financial concerns have finally sacked the National Football League’s (NFL) Washington franchise, causing it to change a name that Merriam-Webster defines as “offensive.” While it’s good that Native Americans will no longer be subject to that denigration, a broader question remains: Should any sports team’s mascot be a person?

High school, college, and professional sports are peppered with teams named after people groups. In 2014, USA Today reported that of the 10 most popular high school mascot names, three had human connections: Vikings (#4), Warriors (#9), and Knights (#10). People names are also prevalent in Division I collegiate athletics, e.g., Knights and Spartans. Then there are professional sports franchises like the Dallas Cowboys, Milwaukee Brewers, and Cleveland Cavaliers.

In fact, nearly a third of teams in the United States’ four major professional sports leagues use people as mascots (39/123 = 31.7%). Here’s the breakdown by league:

Major League Baseball (MLB): 13/30= 43.3%
National Football League (NFL): 13/32= 40.6%
National Hockey League (NHL): 9/31= 29%
National Basketball Association (NBA): 4/30= 13.3%

To argue to change a team name that serves as a racial slur is pretty straightforward, but what about the dozens or hundreds of other anthropological nicknames? Is society failing to see now a practice that in years to come will be deemed abhorrent?

Apparently, few people objected in 1933 when George Preston Marshall changed the name of the then-Boston-based football franchise from Braves to the current one. Likewise, few appeared to challenge the U.S. Patent and Trademark Office’s decision in 1967 that gave the name legal protection.

In 1972, a variety of Native American organizations asked team president Edward Bennet Williams for a name change, but their plea evidently gained little public support and ultimately failed to alter his attitude.

The point is this: Just as the majority of the population was apathetic about the need for the Washington football team name change for most of its history, people might look back 20 years from now and wonder, “How could individuals in 2020 have been so ignorant to have people as mascots for sports teams?”

Now, however, many see being chosen as a team mascot as a sign of respect. After all, sports are about competing and winning. So, teams tend to pick mascots that are known for strength, speed, or ferocity or that possess some other desirable qualities that might reflect positively onto the franchise. Although sports teams called Acorns and Spudders actually exist, they are the exceptions. Instead, most team names are chosen because they suggest power and inspire confidence, like Wildcats and Warriors.

At first glance, Merriam-Webster’s definition of mascot reinforces the notion that being chosen as one is a positive thing: A mascot is “a person, animal, or object adopted by a group as a symbolic figure especially to bring them good luck.” How many people, however, want to be someone else’s good luck charm? Most people probably want to be the one enjoying success, not the token symbol responsible for helping someone else win.

A mascot, therefore, is a kind of ‘second class citizen,’ more of a possession or pet than a person. Of course, many mascots are actual animals, kept in cages or put on leashes and paraded in front of fans on gameday. Although mascots are typically chosen for their prowess, it's strength subdued in service to another.

At this point, some of you may be understandably thinking, “Relax! They’re just mascots. Sports are supposed to be fun!” I get that. I’ve appreciated mascots for many years and still do.

When I was much younger, I played for Danville, PA’s high school basketball team, whose mascot name still is the “Ironmen” (granted, not very gender friendly); the town was a key player in America’s 19th century iron industry. I’m also a long-time fan of the NFL’s Pittsburgh Steelers. Honestly, I never thought much about implications of these mascots being people . . . until now.

Would an iron mill or steel mill worker mind that their occupation was selected for mascot status? I'm speculating, but my guess is they wouldn’t; in fact, they might even feel honored. Their reputations as occupations that require unique physical and mental toughness probably makes their selection seem complimentary.

These two examples, however, help identify a potentially important distinction: Not all human mascots involve occupations, which people self-select. Some mascots are based on demographics like race and ethnicity (e.g. Cleveland Indians), over which people have no say.

That lack of choice is compounded by the issue of stereotypes. Any human mascot suggests a certain image for all those belonging to the demographic. For instance, the name Braves implies that all Native Americans are courageous and strong.

But, what could be bad about being perceived as strong and courageous? Aren’t they attributes that anyone would want? Perhaps they are, but the reality is, not everyone has them to the same extent. For Native Americans, that 'positive stereotype' might negatively impact them in at least two ways.

First, the Braves mascot stereotype might make those who weren’t born with as much natural strength or courage feel inadequate, like they’re not living up to an important social standard. Second, a seemingly positive stereotype still pigeonholes people, or presents an unnecessarily narrow or inaccurate view of their abilities.

For example, I’ve been around sports enough to know that African American men are often stereotyped as great athletes. At first blush, that stereotype may seem positive, but if you’re an African American man, you may not appreciate people assuming that you played and/or excelled in sports, especially if you never did. You also wouldn’t like it if people discounted your intellect, as they sometimes do for athletes, inaccurately assuming that a strong body means a weak mind.

There really is no such thing as a positive stereotype. Unfortunately, mascots perpetuate stereotypes, which may not be an issue for animals or inanimate things but can be problematic for people if the mascot is tied to a demographic like race or ethnicity that individuals do not choose.

In more recent years, it seems that sports leagues have become more ‘enlightened,’ as it’s rare for expansion teams to be given human names. For instance, since 1976, six new teams have entered the NFL, but only one was given a people name—the Houston Texans, which is not directly tied to race or ethnicity.

The Washington Post reports that the Cleveland Indians are now considering a name change. It may not be long before other teams named Indians, Braves, Chiefs, etc. do the same. Projecting further into the future, it’s conceivable that some of sports’ most storied franchises, e.g. Celtics, Fighting Irish, will do the same.

Mascots related to occupations, which people choose, can likely stay. However, team names based on race or ethnicity should be retired because of the narrow and unfair stereotypes they project. Years from now, if not sooner, people will see such team names and call them “Single-Minded Marketing.”

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