Category Archives: Perception

Apple understands how to do (not) discounts

Black Friday is the day many brands offer discounts. Strong brands, like Apple, never discount the core products.

For companies, sales discounts are a great way to boost short- term sales. It is an approach with guaranteed success. Even people who do not need the product right away might buy because of the great discount. Like with everything, there is a flip side to discounts.

1. Postponing purchases
Consider carefully discounts for products that are not fast- moving consumer goods but substantial investments for consumers. Consumers can often wait to make the purchase when it is not highly necessary. It is not uncommon for people to sleep on the old bed a few months longer and wait for a good discount.

2. Creation of artificial purchase cycles
Some companies run discounts during specific times of the year. When consumers know about the cycle, they will wait for the following discount round. The brand has unwillingly created an artificial purchase cycle.

FujiFilm is a company with artificial purchase cycles. The company runs pretty steep discounts on its cameras and lenses in spring, summer, and winter. People who are in the FujiFilm camp make purchase decisions three times per year. If the desired products are not on sale in the current round, chances are the dream kit will show up in the next round.

3. Abandonment of retail prices
Discounts reduce the suggested retail sales prices of products in the mind of the consumer. Once buyers have seen a printer in a special offer for US$69, they won’t pay the US$99 suggested retail price ever again. Getting the product cheaper has now become a real possibility. The discount helped the short-term sales but made the brand and product positioning weaker.

 

The alternative to discounts
The best alternative to discounts is to provide perks around the core product. For example, a brand known for its leading Music composition software should not discount the core product, the What of the brand. Instead, it should provide extra perks around the core product like giving a plug-in or sound bank for free.

Apple follows this strategy. The company hardly ever gives direct discounts but turns discounts into Apple Gift cards. Of course, the Gift Cards are to be used in the Apple Stores.

Perks are a great way to give people ‘a good deal’ while in their minds, the value perception of the core product has not changed.

——
This post is taken from my new book Win With What – the first category-led growth book.

And so much more…

It is the Apple WorldWideDeveloperConference time of year again! Traditionally the moment that Apple showcases significant changes to all their operating systems: macOS, iOS, iPadOS, WatchOS.

This year was a mixed bag. The announcements were mostly a list of Apple app updates. Clearly, Apple is a fine-tuning mode and has difficulties coming up with breakthrough features in the current platforms and usage scenarios.

Engadget stated for MacOS “With macOS Monterey, Apple is trying to polish its desktop operating system even further.”

What is worrying is that on the Apple.com front page there is just a sheer amount of features listed under every OS.

iOS 15

Connect with family and friends while watching and listening together in SharePlay. Be more present in the moment with Focus. Explore the world in unprecedented detail with a reimagined Maps. And use powerful on‑device intelligence to do more with iPhone than ever before.

iPadOS 15 update

Do more things even more easily with powerful new multitasking tools. Create notes from any app using Quick Note. Add new widgets that let you see information at a glance right on your Home Screen. And enjoy many of the great features also coming to iOS 15.

MacOS Monterey

Share your screen with friends and coworkers in entirely new ways with SharePlay. Explore a more immersive, customizable, and streamlined Safari. And with Universal Control, you can now work seamlessly between your Mac and iPad.

Watch OS8

Give your Portrait mode photos from iPhone a starring role on a dynamic new watch face. Unlock your door from your wrist with home keys. Work out with tai chi and Pilates. And center yourself with new Mindfulness experiences.

Now – tell me quickly….
What is the key reason to upgrade your iPhone, iPad, Mac, or Watch?
or What is iOS 15, iPadOS15, Mac Monterey of Watch OS 8?

I know that the answer is not going to be a crisp one. Apple is not communicating the one reason to get completely excited about any of the updates, or the one reason you would want to have the updates running on your devices today.

Even when categories mature consumers need incentives to upgrade.  While difficult it is better to pick that One Feature to steer all communications and PR than having massive feature lists leaving consumers and media wondering where to focus on or determining which one is really important.

Credibility is lost when you do not live up to what you stand for

When you repeatedly go against your mission and values, you lose credibility, and your position is in danger. The audience will start to drift – first, slowly towards other platforms. Drifting will accelerate once a critical mass through worth of mouth is reached. Then there is no way back. 

Brands are like people.

If you for example do not like how a friend behaves, you can simply decide to no longer hang out with your friend. The same goes for brands. If a brand behaves terribly, you can decide to stop engaging, buying, or using that particular brand.

It gets tricky when your friend says that living according to noble values is essential and even points the noble way of living out to others. It comes then as an unpleasant surprise when you learn that your friend is everything but living up those dearly hold and communicated values. We get confused because the friend’s behavior does not match the perception we have about the person. The person is no longer credible.  If the friendship continues, it will be an unhealthy one based on disbelief and issues with trust. If a brand stops living the values, the same reaction of disbelief and distrust appears. And over time, we will look for alternatives.

Today I encountered a trust issue with YouTube, the brand that has brought video sharing to the masses. YouTube helped to accelerate the growth of humans by bringing immense knowledge to the fingertips of everyone.

Already for some time, YouTube is actively censoring freedom of speech by removing videos or channels about medical information, science, scientists, specific news channels, or simply videos containing an opinion (how scientific it might be) that is going against a set of guidelines, therefore stopping the debate and opportunity for humans to learn.

Earlier this morning, I decided to take a look at the About YouTube page (link, archive ) to understand what the company is all about and the brand credibility with me.

The first thing you encounter on the about page is a clear mission statement. Unfortunately, YouTube is actually actively going against their own mission. For YouTube not everyone is the same, some deserve to  have a voice, while others unfortunately do not.

When we look at the values we see a similar pattern.

The Freedom of Expression is striking:

We believe people should be able to speak freely, share opinions, foster open dialogue, and that creative freedom leads to new voices, formats and possibilities.

If YouTube in the last year has shown one thing it is that it is not a real advocate of Freedom of Expression.

I have therefore one simple question for YouTube:

—-
Dear YouTube,

You have given me a lot of opportunities to enrich my knowledge on virtually any topic. I thank you for that.

Unfortunately, I am distrusting you and as your friend I see two options going forward:

  1. You live up to your values,
  2. You update the values to reflect your behaviour.

Either way is acceptable because strong brands provide clarity regarding what they stand for and consistency in execution using company values as a steering compass. Only this way, they remain credible.

Make your choice.

—-

Photo by Adam Fejes from Pexels

Reddit Nailed It

Jep… Reddit nailed it with the first-ever JPG(!) SuperBowl Commercial

The actual message – that one slider – was nicely wrapped in a short reel controlling placement and impact. The total commercial was 5 seconds only. 

Reddit did a great job, and with only 5 seconds of airtime, the commercial generated a maximum impact. Those interested in learning what the message actually said had to go online to find out, and once online, the step to visit the Reddit platform to learn what it is all about is easy.  

In essence, Reddit tells us that “powerful things happen when people rally around something they really care about”. The old Nokia slogan “Connecting People” is still alive and well. This time, according to Reddit, the platform to connect is their online platform.  

The 5 second commercial:

The key message (JPG):

Marimekko, do not buy the rights!

After Kristina Isola acknowledged the plagiarism of a design, it has been very interesting to see the various reactions of Marimekko, media, marketing and branding professionals. However, the most important and defining factor for the Marimekko brand going forward has been left out: managing the associations that consumers have with the brand Marimekko.

In the end, brands are merely associations in the minds of consumers. For example, Coca-Cola is associated with the real Cola drink and Snickers is associated with a peanut candy bar. Brand associations are very difficult to change. That is, until something disastrous happens and the brand owner does not deal with it properly. We have seen that happening to BP after the oil disaster in the Gulf of Mexico in April 2010. The share price has still not recovered.

For Marimekko, the most important thing should be to ensure that consumers do not change their brand association. For example, if a consumer believed before that Marimekko equals “iconic Finnish fabric design”, Marimekko should do everything it can to avoid a change of association to “iconic Finnish fabric design and possible copies”.

The decision of the company to buy the rights to designs of Maria Pryimachenko will only give more opportunities for consumers to change the brand association. Why? Because it allows the discussion to continue and most importantly, it gives a constant physical reminder of the copy scandal. The continuous opportunity for consumers to change their brand associations is very harmful and can even be fatal for a brand.

If you are convinced that buying the rights to the designs of Maria Pryimachenko is the best thing to do, I invite you to go to a Marimekko shop and imagine you see those designs. Then be really honest with yourself: what do you think and feel about Marimekko? Has it changed? How?

What could Marimekko have done to ensure that consumers would have little opportunity to change their brand associations? They should have started with a different outcome in mind: a zero change in the brand association. As a result, the company should have been very firm and confident with consumers and media.

Don’t fight the facts, but deal with them. Don’t wait and see, but act. Don’t blame, don’t dismiss but take full responsibility and publicly end the relationship with Kristina Isola. By not distancing itself strongly from her, Marimekko indirectly indicates that ‘it is not a big deal’. From the moment this crisis started Marimekko should have followed its corporate value “fairness to everyone and everything” and actively reached out to the copyright holders.

When all of the above happens in an open and transparent way, a way that consumers can come to terms with and think ‘I understand and I would have done that too’, the brand is OK and brand associations have little opportunity to change.

This post appeared in Markkinointi & Mainonta

Netflix buys DVD.com, what’s next in the branding saga?

Netflix, once known as one of the most successful dot-com startups is going through a rough time with some serious branding mistakes. Today I read on engadget.com that Netflix bought DVD.com… why would they do that?

Seven years ago the world looked great for Netflix. In 2005 it was shipping 1 Million DVDs per day to its subscribers. Wow! Netflix had an amazing position: it simply was #1 in the DVD rental. Netflix was nicely riding on the DVD player sales. There was one problem though… the DVD player was eventually going to be replaced by digital distribution.

The Netflix folks saw that coming and in 2007 they introduced streaming under the same Netflix brand. The service became successful but times changed and in Q3 2011 Netflix lost 800.000 subscribers.

The Netflix folks saw that one coming too and decided that the strong brand Netflix should live on in the streaming business, making place for a new brand called Qwikster for the DVD rental business. A couple of months later the idea was buried.

Or… was it? Netflix has now bought DVD.com. I am sure one of the ideas of the folks at Netflix is to use that for the rental business, moving Netflix over to the streaming business forever.

Now… what is going on here? Is this really the smartest move? No it is not!

Firstly, Netflix should have retained the Netflix brand for the DVD rental business only. The brand was the number one in the category. Even though the category is dying (and with that the brand) it would have been the best thing.

Secondly, for the streaming business a second brand would have been appropriate. It is a substantial new business / category in which the company could have been number one again. This brand should have been positioned as the streaming service.

Thirdly, buying a generic domain “DVD.com” is really a waste of money. Consumers are not thinking “I’d like to rent a DVD so I go to DVD.com”,  they think “I’d like to rent a DVD so I go to Netflix.com”. The DVD.com “brand” is a waste of money.

 

Product naming going wrong, case: Apple Final Cut Pro X.

Since 2005 Apple has sold a professional video and audio production suite for OS X named Final Cut Studio. The core product inside this suite is Final Cut Pro, a video editing product. It has been around since 1999 and is used by many filmmakers.

A couple of weeks ago Apple launched the long-awaited successor of Final Cut Pro 7, called Final Cut Pro X.

Here is a test for all readers… by just looking at the name and without possibly any prior knowledge of Final Cut Pro…  what would you expect of Final Cut Pro X as a successor of Final Cut Pro 7 ?

Could it be: everything from version 7 and much much much more… including some super new innovations in video editing (why otherwise use the X in the name)? This expectation building was happening inside the community. To sum it up with two words, the expectation was nothing less than total awesomeness.

Apple however decided to do things differently. They build Final Cut Pro X from the ground up as a new product, leaving many features desired by the Final Cut Pro 7 audience out. To name a few: importing of video projects from version 7 to X does not work (hey? why do you call it still Final Cut Pro if it cannot handle Final Cut Pro files?), multicam editing (hey? isn’t this a Pro feature?) and many more.

Professional editors get even more the feeling that this is not a Pro product when they launch Final Cut Pro X for the first time. At that time a dialog is presented to import iMovie projects. iMovie is Apple’s entry video editing product that is part of iLife. Products considered to be used in the home environment, not by professionals…

As a result of all of this the product is rated really bad on the Apple Mac App Store. And note, consumers can only rate after they purchased the USD 299 product:

For any Apple product these are not normal ratings, far from it! So the question is could it be that the name positions the product wrong? I think partly it is. Let’s take a look:

  1. A name has a meaning. There is Photoshop CS3, CS4, CS5. A consumer expects all of these to be photoshop. The same applies for Final Cut Pro. Unfortunately Final Cut Pro X has little or nothing to do with the previous Final Cut Pro 7.
  2. Do not alienate your target audience. Clearly, for whatever reason Apple is not after the professional market and that is of course totally fine. But it is not smart to let your previous target audience believe you still make a great product for them. In stead, Apple could have simply named the product iMovie Pro as many have suggested on their product reviews on the Apple Mac App Store. That way it would have been clear to the professional market that they should switch to another brand, without letting them buy Final Cut Pro X and be double disappointed. At the same time not naming the product Final Cut Pro would show to the professional consumer that there now is a product beyond iMovie that is not as hard to use as Final Cut Pro was. Something Apple clearly wants to achieve.

Take a look at the two reviews below. These reviews were served first when searching for Final Cut Pro X on July 19.

The big questions: would all of this have been different if the product was called “iMovie Pro”?
… And by doing so would the one star ratings go away?
… Would the endless complaining about the Final Cut Pro X not being the same as Final Cut Pro 7 go away?
Ultimately: would the product have been positioned correctly by naming it properly?
Screenshot from July 19, click to enlarge