The Gap Revives The Brand Without Making a Change
The internet is buzzing right now about the power of social media. A few weeks ago the Gap announced plans to change their logo. For years they had the logo we all remember that was on every bag and tag we ever got from them while shopping. They decided to change it up and for a brand that was not doing all that well in recent years and had begun to fall from a position at the top of a chain a firestorm ensued. The net result was an unbelievable amount of free publicity and a lot of bloggers and social media types taking credit for the reversal.
It is far more likely that the GAP used the opportunity to get their brand out in the wild again. Twenty years ago the company was the darling of people everywhere. After a couple of decades the love had begun to fade. When the Gap announced they were reverting to their old logo there was immediately a bunch of articles written about the power of social media. A quick check of the headlines shows that there are several thousand news stories in the last few days about the story. At a few hundred dollars a press release that is millions saved on free publicity. Most major news stations carried it on television and it made the major financial newspapers. Yet unlike most other major launches there are no reports of the new logo being in the wild in the form of shirts, pens or other trinkets. Usually at least a few of these items will get out there long in advance of the launch. Ebay has nothing and neither does the other major buying service. It makes for some interesting speculation as to whether or not the entire situation was deliberate and much like the old Coke new Coke fiasco from the 1980's part of a plan to put the brand back on the evening news.
The Gap had watched sales drop by about 12% in 2008, 3% in 2009, and sales were trending negative again in 2010. However there are reports that sales have been brisk since the news broke about the change in logo. The timing was also not a coincidence and allowed them to gain maximum exposure just prior to the fall sales season. Brilliant really but it probably had nothing much to do with consumer reaction to the logo as it did in creating buzz for the company.
Gearing up for Specialities Season and Economic Lag
Anyone that owns, operates or works for a small business has probably noticed that over the last year or two small business performance is way ahead of economic news that makes it to the evening news or online. The business cycle seems to have really changed and by the time we see reports of economic conditions we have already dealt with them as small business participants.
There is almost no doubt that later July into the middle of August was significantly slower than earlier periods of the year. The numbers from July however show strong retail sales which may only prove the point that people were spending money on themselves and not necessarily their businesses. By the time mid August rolled around and people returned to work from summer vacations business sales began to pickup and that has continued into the later stages of the month. However the economic news that made the major outlets during that time lagged significantly failing to flag the slowdown until it was already over and failing to note the return to more normal patterns after it happened. Is the problem poor data or is it that the economy now cycles much faster than it did years ago? I think it really is fast cycling and buyer psychology. With some much financial news now available consumers adjust their expectations and behavior on the fly. Just take a look at the stock market and you will see some incredibly fast movements in behavior that have no real rationale explanations.
Taking a look back through our more recent articles, the Ice and Wine Gift Segment was one of the more popular articles written to date. The Grigio has already garnered enormous interest and there is no doubt that will continue. The most popular article still has been the discussion of why laundry caps are still tough to read. Apparently we struck a nerve with consumers tired of paying too much. Last but not least the discussion of checkpoint friendly computer bags has been forwarded more than any other article. As business travel picks up we expect to see business sales for checkpoint friendly bags soar.
Time for Laundry Detergent Brands to Change Laundry Cups
One of the immediate results of the dramatic rise in oil prices during 2008 was an equal rise in shipping and transportation costs. We all saw increases at the pumps and as well we all noticed the gradually but steady increase in prices for almost all goods and services. But did you all also notice that many of your favorite products particularly the heavier ones were downsized during the same period? After running a two week test over 20 loads of laundry it is pretty clear there is one big winner in the laundry downsizing game.
Take a look at your favorite laundry brand. Three years ago the shelves were lined with large containers that got anywhere from 32 to 64 loads of laundry done depending on the container. There were a few bottles marked for high efficiency washers and a few that were labeled as two times strength and as a result were thin bottles. It wasn't until oil prices hit record highs that all manufacturers switched to the double strength bottles which strangely cost the same for the same number of loads but certainly cost a lot less to transport. One unfortunate aspect of the new bottles is that the accompanying caps were also about half the size. Trying to read the line on the measuring cup was difficult with the larger caps and is now impossible with the smaller cups. The tone on tone coloring makes it no easier. The fact that our largest detergent companies are unable to produce a cap with a contrasting measuring line is troubling as it has two effects that are both bad for consumers. First a majority almost certainly end up putting in way too much solution. In almost every case the cap only needs to be about one quarter filled. The top two lines which you are actually able to see are for double or triple loads. Second we are dumping all sorts of nutrients into either septic tanks or the sewer system which ends up getting dumped into local waters. Clearly there is no benefit to consumers but you can almost bet for sure detergent sales are up proportionally to what they were a few years ago as we all use more of the double strength solution than we need and as a result are probably going through the average 32 or 64 use bottle 25 or 40 percent faster than we were previously. After digging up and old bottle of normal size and running a two week test it was pretty clear that pouring and measuring in the new cup was prone to over indulging on the amount of detergent. This was not a scientific test but common sense and the human eye clearly demonstrate it is nearly impossible to read the measuring caps in modern detergents. At the very least manufacturers should be using contrasting lines - if they are using a dark blue cap make the measuring lines white and the letters large in white. Better yet make the caps transparent so that light gets through and make the lines and printing in bold colors.
If this bothers you take a moment to write a letter to the big producers. They should be aware that their practice of either accidentally or deliberately making it difficult to read the caps should be changed. It is better for consumers and better for the environment. Tide can be reached by email or phone at the Tide Contact Us Page. You can contact Dwight & Church via their comment page. They make a lot of the off brands you see in CVS and other stores in addition to the Arm & Hammer line. To round out the list of larger selling brands we have the page to contact All Detergent. In the past many of these manufacturers have been responsive to change. If enough people contact them there is a very good chance we will see a positive change which will help our bank accounts and in turn will help the environment.
Top Five Supplier American Apparel Circling Drain?
The news was already bleak for ASI supplier heavyweight American Apparel early this year when it was revealed the company was close to triggering stipulations in loan agreements. The potential problem was averted when the debt was restructured in favor of a higher interest rate note. All that apparently did was buy some time for the inevitable debt crush.
The stock was hammered today as the company warned that it is facing a serious liquidity crisis. As the NY Times indicated in an article today on American Apparel which indicated they are all but out of options. Despite a reasonable uptick in sales industry wide this year they have reported sharp sales decreases. Without speculating much on the reason it could well be that the hypersensitive distributor model they have had for the last few years has failed and catering to skinny teens will not buy you strong sales among older executives. They also report that they will not file a timely report and therefore will likely be delisted.
It was just four years ago that 60 minutes hailed American Apparel as a made in USA success story but very clearly it was all smoke and mirrors. The company was always highly leveraged and was unable to adjust like other heavyweights like Broder Bros. was able to do in 2009. It is an unfortunate case of too much too fast as the company opened expensive stores in premium locations instead of hoarding cash in a recession. The unfortunate aspect of all of this is that more jobs are likely to be lost in the US.
Promotional Products Industry Plagued By Inventory Problems
One of the major challenges facing the promotional products industry as we head into the middle of 2010 is the absolute lack of inventory available from major ASI suppliers. This is mainly the result of poor planning or inability to see the return of the economy in the first months of the year. But it is also partially attributable to problems with cargo containers leaving Asia. That leaves distributors in the difficult position of not being able to provide new products to customers.
And there are a good amount of new products hitting the market this month. Leeds a division of Polyconcepts has launched an entire umbrella line. One of their newer offerings the 41" Classic Folding Umbrella is the very first custom printed umbrella Leeds has ever offered. This is one of the first major leaps for Polyconcepts into a new market since they launched their technology line several years ago. The umbrellas are scheduled to arrive in the coming days and as of this point there are no reports of difficulties in transit. Meanwhile over at Bullet Line which is another division of the same parent company they have expanded their custom caps line. Do you remember the big foam hats with a mesh back that were so popular thirty years ago? They are back with a vengeance and the Solid Cotton Twill Trucker Cap is one of the additions to the offering this year. Almost all of these hats and caps include custom embroidery in up to 7500 stitches which will cover almost all users. A nice aspect off the foam hat is it presents a large decoration area, almost a billboard for that matter on the front.
It remains to be seen whether or not the big players in the industry will have problems with freight as the year goes along. We should also be clear on another point. It is not that the containers are totally unavailable it is that the prices have gone up so much for immediate shipments as they bring capacity back online that some manufacturers are electing to wait it out. In some ways you cannot blame them if the alternative is shipping products that will eventually result in a loss or diminished profit. Combined with what were some of the higher fuel prices in the past few years once products arrived in the States there is no choice for some producers but to wait it out. Several of the major players have taken the time to write to their distributors explaining the shortages and this has gone a long way to repairing relationships and it also helps distributors maintain honest relationships with their end user clients.
As many of you may have read Google has announced that Caffeine is complete. Like so many others online I have noticed a steady decline in the quality of search results. One can only hope that in the coming weeks and months they fine tune this new product to bring it up to earlier higher standards.
Culmination of Factors To Slow Ad Specialties Markets
The fourth quarter of 2009 and the first quarter of 2010 caught a lot of the promotional products suppliers off guard in terms of growth and overall interest. As a result most are expanding up production and imports to compensate for the lack of inventory many suffered from into May. The only problem is that the economy is likely to stumble as we approach summer thanks to the effects of government stimulus wearing off and higher energy prices. Indeed in many parts of the country gas has hit multi-year highs.
With the increase in gas prices we will once again see people practicing staycations this year. You have all heard the term now, instead of expensive trips people are electing to stay local. This is where the Dunes Outdoor Game Set comes into play as it provides a unique branding opportunity on an item that has already sold out through May. In fact this multiple piece set has been so popular so far it may well end up in short supply into June. The true advantage of this type of corporate gift is that it provides a kid friendly summer promotion. The Laguna Game Set which also is manufactured by Leeds has a slightly higher price tag do to the increased number of game pieces and does include the almost popular chess and checkers. More importantly both game sets include a kite and beach ball as well as the Velcro paddle toss game. The toss game is similar to the more extensive paddle ball game you have seen played on beaches for years. Rather than decorate each piece in order to keep the acquisition costs down the carrying case or backpack is decorated. This is both convenient and also not nearly as intrusive.
The problem to date with both of these game sets is stock. The manufacturer which is owned by Polyconcepts, continues to have severe stock issues partly attributable to the increase in economic activity. As a result container ships have been delayed and that is resulting in long delays in getting products onto warehouse shelves. It is still a little surprising that vendors were caught off guard particularly in light of how strong the economy was at the end of 2009 but that is where we stand today. There are solid signs now that growth is slowing and with the increase in inventory dollars being spent and the subsequently increasing amounts of cargo capacity to and from Asia the favorable news is that stock issues should diminish as the year moves forward.
Simple Marketing Efforts Sometimes Effective
Day in and day out we are hit with advertising messages that are at times becoming so complex they are flying above the heads of the intended markets. Although these types of "thinking" marketing efforts can be very effective they have their place and time. With the economy the way it is today even organizations that are doing very well are reluctant to spend money in a way that may be viewed as frivolous. Think of what happened with the major bank last year that was going on a golf outing while borrowing money to stay in business.
That leaves three real possibilities all of which have their advantages. First a business can elect to not advertise at all. Obvioiusly this is not the ideal approach to gain market share. A second option is simply to spend less. The promotional products market is being dominated right now by products like the Fuzz from Leeds. A couple of years ago nobody would have even taken a look at this product at the top firms. They would easily have passed it over for more premium items. Lint brushes are hardly the giveaway of choice for top executives but they will carry a logo and do it in an economical manner. Along the same lines the lightbulb keychain has all of the virtues associated with LED type keychains which can provide an end user with safety at night but is affordable and will not be viewed as breaking the bank. A final approach would be to replace an item used on a dialy basis such as the Leeds Double Wall Ceramic Tumbler which can be used in place of a regular coffee cup. The advantage of this type of approach is that it serves two purposes, first it reduces the cost to the end user employee or client and actually helps to decrease the amount of trash and second although it is a premium item it does not carry the baggage a high end leather or desk gift might.
Meanwhile the imaginary world our politicians live in continues to provide evidence on a daily basis that the disconnect grows. Treasury Secretary Geithner indicated on the Sunday talk shows that the economy is growing more rapidly than they expected. Of course he glossed over the 10% unemployment rate, growing commercial real estate problem and also increasing fuel prices. These are all factors that are going to continue to impact families and as a result will temper any recovery. Instead we will be left with a recovery that has fits and starts much like we saw at the end of 2009. In addition there appears to be no acknowledgement of the shift going on overseas. Instead of shipping products to the USA we are finding factories overseas are either holding containers or are shipping products elsewhere to economies that are recovering more rapidly than we are domestically.
To see more of the Leeds product line take a look at Leeds site. They offer over two thousand promotional products and the number continues to grow each day.
An Alternative Approach To Buying Green
The focus for Earth Day tends to be on buying recycled and other environmentally friendly products. Quite often very little time is given in consideration of where those products may be coming from or of the carbon footprint involved. Having some experience in this industry suffice to say there are gigantic problems with the promotional recycled business as it is now.
An alternative to buying an item that may be recycled from materials made half way around the planet is to buy a one trip item. By this we mean an item designed to degrade in the ground. The Biodegradable BPA Free Sport Bottle not only has the advantage of falling into the eco-friendly category but it does so at a much lower cost to the environment. Almost all of our current recycled promotional items manufactured by ASI suppliers are of questionable origins. The underlying first use products such as the water bottle are used domestically before being piled into containers. These containers often end up being loaded into larger containers before they are shipped to Asia. At that point they are recycled into new products which are then again shipped back to suppliers throughout the country. Rather than going through all that trouble and burning all that fuel it makes more sense instead to choose a product that will break down in a landfill at no additional cost to the environment. This particular bottle is one of the few we have come across that is also BPA free. Although the debate rages on about BPA there is no sense in having a product that contains it at this stage.
Last week witnessed some mediocre economic news. There are several reports due out this week that will shed a lot of additional light on how business is going. In our eyes it is pretty clear though that with job losses still mounting and gas prices also increasing there is little hope for a substantial recovery. Instead we are in a pattern once again of fits and starts as the economy grows for short periods after intervention from the government only to slow again later. We will begin daily updates on Monday and look forward to providing additional reviews.
Poor Decisions Plague Great Dramas
Picture a scenario in which you have a popular product that is in high demand. Any person with a marketing degree or basic business background would do everything within their power to culvitate that product brand and extend the popularity and dominance of it. Unfortunately for many of us that enjoy television from time to time the major network executives appear to have misunderstood this valuable lesson.
It was only a few years ago that ABC started the nonsense by taking a popular show in NYPD Blue and putting it on a multi-month hiatus only to bring it back after winter ended. The net result was a loss of audience as viewers got confused or just lost general interest. It reminded me a lot of what a major soft drink manufacturer tried to do in telling consumers how they wanted to behave. You will all remember the brightly colored bottles on store shelves that were gradually replaced by the "classic" version of the soda. NYPD eventually ended up off the air even as some of the greatest episodes were being produced. That same network continues to ruin shows that if given the chance may well have the success of classics such as Lost. Instead of working to extend the brand and allow consumers to get into an established pattern of consumption they continue attempt to tell us how we want to view their product. Anywhere north of about the 38th parallel is busy shoveling or being cold in December and January. It is a great time of the year to cuddle up by a fire or with your family and watch television. Unfortunately we are bombarded with repeats during that time or worse the dreaded middle of the season launches.
There is a lesson to be learned in all of this and in the next day or two we will tie this back to the promotional products industry which is suffering right now from major product shortages. Part of that is due to major increases in business since last year but a good part of it is the same poor decision making that plagues the networks. Give your customers what they demonstrate they want and more importantly give them time to determine whether or not they actually want your product or service. If interest is shown continue a consistent approach and avoid the random and unsuccesful marketing strategies that continue to make failures out of what would be successful shows. With news that Flash Foward is likely to be cancelled and with V struggling the long term guaranteed method of ruining ratings by boring customers for months at a time has struck again.
Economic news was wobbly at best yet we continue to see fuel prices accelerate northward. Astounding that the major media outlets have ignored what was one of the warmest winters in recent memory over a good majority of the USA and instead continued to tow the line for the major oil companies. Our economy will pay a steep price later this year. We have talked about keeping your message cool and that is all that much more important as we head into the buying season where picnic items are important. The same unfortunate marketing strategy was employed by Congress as we discussed in Proper Promotional Could Help Health Care Reform and in a few months they too will see there are consequences to not marketing a product properly.