Subject: Make Way for the Bratty Boomers

From: Chief Marketer <[email-masked]>
Date: Tue, 01 Feb 2005 11:40:01 -0600

February 1, 2005 | A PRIMEDIA Property |

Table of Contents
Demographic Targeting: Here Come the Bratty Boomers
Direct Marketing: Short-Term Behavior, Long-Term Value
B-to-B: Overestimating Creative Among the Deadliest Sins
Consumer: Retailers Love Valentine's Day
Branding: The Apple of Their Eye
Advertising: Super Bowl Champ Predicted to Be...Frito-Lay

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This Week's Stories
Demographic Targeting: Here Come the Bratty Boomers
By Cliff Banks
WARD'S AUTOWORLD
At first glance, the Toyota Sienna minivan commercial is cute. A guy in his late 30s gives several young children a ride. The kids make various demands of their driver, including picking up a dog named "Bob." They respond rather abruptly when the driver asks a question while they are watching the in-vehicle DVD system. As the minivan pulls into the dealership parking lot, one young girl demands, "Now we'll test the red one."

By the end of the commercial, many parents would find these kids, not cute, but boorishly snobbish, demanding. In other words, spoiled brats.

The commercial has ominous implications for the future. The kids are part of the age group that is the last wave of the much-ballyhooed Generation Y crowd.

If you're thinking, "No problem, we did OK selling to Generation X," think again. Gen X numbered only 17 million, so if a company misfired on its strategy of selling to the so-called slacker generation, it still could survive. Misplaying the Gen Y crowd, though, could bring disastrous business results because the numbers are much larger. Gen Y will be 60 million-70 million before Generation Z (or whatever moniker the next generation is tagged with) enters the automotive marketplace.

To read more on auto companies' efforts to target Gen Y, visit WARD'S AUTOWORLD.

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Direct Marketing: Short-Term Behavior, Long-Term Value
LIST AND DATA STRATEGIES FOR THE MULTICHANNEL MERCHANT
Direct marketers put a huge amount of time and money into examining, testing, analyzing, and fine-tuning their marketing on a campaign-by-campaign basis. The results of a single campaign are judged by response rates, average spend amounts, and often, the ROI generated by that campaign.

But less attention has been given to the long-term behavior of customers, says Don Austin, Ph.D., director of client strategy at Greenwich, CT-based list services firm Direct Media. In general, the amount of the first transaction predicts the amount of subsequent transactions. But Austin a variety of other variables can be used to segment customers into low long-term value and high long-term value groups.

Austin cites the example of a seasonal, highly promotional catalog that mails heavily in the last part of the third quarter and the early fourth quarter. "We found that the long-term value of those customers who spent just the amount necessary to achieve the promotion--free shipping--was less than those who spent somewhat less but were more apt to purchase again within the same season," he says. "We were able to conclude that the free shipping offer was not productive for this cataloger in terms of long-term value."

To read more, visit CATALOG AGE.

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B-to-B: Overestimating Creative Among the Deadliest Sins
They're not quite as venal as lust, avarice, and envy, but according to Sharon, MA-based advertising and marketing agency Tiziani Whitmyre, "the five deadly sins of b-to-b marketing," as outlined in a new white paper, can kill a campaign.

So what are the deadly sins?

1) Forgetting the audience. "With b-to-b marketing resources shrinking to nano-dollar proportions, defining the audience is critical," writes Tiziani Whitmyre president Rick Whitmyre.

2) Thinking tactics, not strategy.

3) Overestimating the power of creative. "In b-to-b, it's the message, not the medium," Whitmyre declares.

4) Underestimating the power of your Website. As Whitmyre points out, more often than not the Website is the first place a prospect will go to check out a company.

5) Misunderstanding public relations. "Most b-to-b PR programs spend their budgets papering the walls of editors' offices with news releases," Whitmyre writes. "Successful PR placement requires continuous contact and relationship building with editors--over the phone and in person."

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Consumer: Retailers Love Valentine's Day
By Rama Ramaswami
OPERATIONS & FULFILLMENT
According to the National Retail Federation's latest survey, Cupid will be a strong force this year, seducing consumers to open their wallets to the tune of $13.19 billion for Valentine's Day gifts. The average person will pony up $97.27, but only $58.85 of that amount will go toward a sweetheart. The remainder of the money breaks down as follows: $21.49 on other family members, $5.42 on friends, $3.76 on children's classmates and teachers, $2.73 on co-workers, and $5.02 on other people such as neighbors and babysitters.

The older set is becoming more romantic. Consumers aged 45-54 will spend an average of $118.11 this year, a hefty increase from the stingy $88.96 they shelled out in 2004. Quite the opposite will happen with Generations Y and Z -- young adults 18-24, who lavished $154.65 on Valentine's Day last year, will cut back their largesse to just $83.50.

Another NRF survey finding is that trad isn't bad. Although retailers do offer offbeat gift items, most people will stick to gold standards such as candy, flowers, and dining out. Nearly half of consumers (49.4%) expect to celebrate the holiday by buying candy or treating themselves to an evening out (47.4%). More than half of men (57.8%) plan to buy flowers, and one in five (18.1%) will purchase jewelry. And if you simply can't decide what to buy, remember that there's plenty of candy to go around: Eight billion pastel-colored, heart-shaped candies with sweet sayings known as "conversation hearts" will be manufactured this Valentine's Day, according to the National Confectioner's Association.

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Branding: The Apple of Their Eye
A juicy, crunchy fruit isn't what comes to mind when someone mentions "Apple," judging by the results of online marketing publication Brandchannel's 2004 Readers' Choice Awards, The 1,984 participants in the survey judged computer manufacturer Apple the top global brand. Apple beat out the previous survey winner, Google, which this year placed second.

The number three global brand was furniture manufacturer/marketer Ikea, followed by coffeehouse behemoth Starbucks. Rounding out the top five is Qatar-based news channel Al Jazeera, the Arab world's equivalent of CNN or BBC.

The top five brands among North Americans were Apple, Google, retailer Target, Starbucks, and Pixar. In Europe and Africa, Ikea topped the list, followed by Virgin, H&M, Nokia, and Al Jazeera. The top five in the Asia-Pacific region were Sony, Samsung, LG, Toyota, and Lonely Planet. And in Central and South America, the top brands were considered to be Cemex, Corona, Bacardi, Bimbo, and Vina Concha y Toro.

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Advertising: Super Bowl Champ Predicted to Be...Frito-Lay
PROMO XTRA
Branding consultancy Brand Keys surveyed 1,100 consumers who plan to watch the Super Bowl to gauge fans' likely response to seeing specific brands' ads before, during, and after the game. Based on its research, Brand Keys predicts that Frito-Lay will reap the greatest "return on equity"--15%--for its ad spend.

Brand Keys tabulated the return on equity as a way to quantify consumer-loyalty gains and losses from Super Bowl spots. The formula predicts fans' increased awareness of ads; improved esteem of brand image; and increased likelihood to buy the brand.

The predicted runner-up to Frito-Lay is Pepsi (up 13%), followed by Unilever's Degree (up 11%) and Visa, Anheuser-Busch, and Paramount Pictures' "The Longest Yard" (up 10% each).

The likely losers in return on equity: GoDaddy.com (a loss of 6% on its ad spend); Novartis Ciba Vision and Consentino USA (both losing 4%); Volvo and Buena Vista Films' "The Pacifier" (both losing 3%).

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