Is brand extension hurting your brand?

Tims & the new Oreo donut

Tims Oreo Donut

If I asked you who had an Oreo treat available this summer, what restaurant would you say? DQ? McDonald’s? Your local ice cream shop? Nope. It’s Tim Hortons.

Have you noticed Tims continues to get further and further away from marketing what made them famous? What ever happened to their coffee? All I hear and see is marketing for their new Oreo treats or their Greek Yogurt. It makes me wonder if McDonald’s and Starbucks are taking away their share of the coffee market.

A year ago, I couldn’t walk around my office without seeing Tims cups. Now, it’s Starbucks, McDonald’s or the office K-Cup brew. I’ve heard rumours McDonald’s has the contract Tims used to have for its coffee supplier. Does McDonalds coffee taste better? Does Tims coffee taste worst? Or have we stopped thinking about it because Tims has stopped informing us about their coffee?

I don’t know what Tim Hortons stands for any more. Is it coffee? Is it donuts? Is it an Oreo treat?

The same thing is happening with Subway. Since when does Subway have pizzas? I thought they were ‘Sandwich Artists,’ not ‘Pizza Artists.’

Good ol’ brand extension.

You add different items under your brand name to try and lure people to purchase these items because your brand is already familiar to them. Should I get a Tims Oreo treat? “Sure, I like their coffee, so why not try their Oreo treat.” That’s what Tims wants. Unfortunately, it also hurts what made them famous…COFFEE. If you have a bad experience with the treat, you’ll notice you’ll start having negative feelings toward their coffee (or Oreo). That’s the trouble with brand extension.

Why do you think Proctor & Gamble rarely uses their company name when marketing their products? You hear of Swiffer, Tide, Crest, etc… but rarely P&G. You each have feelings about these products, but if you have a bad experience with Tide, you probably won’t have ill feelings toward Swiffer. However, if it was P&G Tide or P&G Swiffer, your thoughts would probably change.

The same goes with YOU and your personal brand. What do people think about you? What are their expectations? Are you being true to yourself or are you over extending your brand? Be careful not to stretch too far or people will forget what made you famous.

Check out this latest example from Amazon and their earnings. They’re trying to stretch too far from what made them famous hurting their earnings: CLICK HERE

Love you,

Jordan

I’m already busy, so I don’t need to advertise

I’m hearing this statement quite a bit as the economy starts to heat up. Here’s the thing, YOU’RE WRONG!

Never stop marketing your product to as many people as possible for the least amount possible

Apple, McDonald’s, Samsung, Tim Hortons, Subway, Ford, GM, Toyota and the list goes on and on and on. They all advertise consitently, whether it’s a slow month or an extremely busy month. They understand the value of awareness. Although a consumer may not be in the position to purchase their product right now, when the consumer is ready to purchase the aforementioned companies want their brand to come to mind.

Also, if you are THAT busy, maybe you should consider expanding your business, whether it be opening another store in a different neighbourhood or expanding to another city. Maybe you can advertise the fact you need more sales people to sell your product / service. Or find better quality service people to handle the increased workload. Whatever it is, never stop. You always want to be top-of-mind.

There are thousands of messages clogging the consumer’s brain every day. What makes your message stand out? If you’re not in the consumer’s face or mind, you don’t exist. You’re merely burning money on rent, staff and other operational expenses.

The best

The best and most profitable businesses understand this very simple recipe for success. Advertising your message 52-weeks a year to the most amount of people for the least amount of money works. And it works really well. Even if your message is shit, it will work (for a short period of time, but it’s very difficult to sell a shitty product / service over a long period of time).

You may be saying, “I don’t have enough money to advertise 52-weeks a year!” QUIET! You do, you just haven’t allocated your resources properly. If your annual sales budget is $100,000 your marketing budget should be $2,000 – $10,000 (2 – 10% of your sales budget). However, I’m sure your sales budget is much higher than that. Then again, your marketing budget is probably significantly lower than 2 – 10% of your sales budget.

Psychology

When it comes down to it, it’s all about psychology. There’s no way you’re going to have the marketing budgets like McDonald’s, Apple, etc… That’s fine you don’t NEED to. All you need is some money and a different mental framework.

Like the example above, you can stretch $2,000 – $10,000 very far on almost any marketing medium whether it be digital or a more traditional medium like radio or print. You won’t be able to reach the amount of people McDonald’s will, but you’ll still be able to reach someone…anyone. 100 people is better than 0.

For example, a restaurant launched and they only advertised to a 40-unit apartment complex next to their restaurant. They printed off some letters they made in Word and put them in the apartment complexes mailboxes. And they did this repeatedly. Needless to say, they owned that apartment complex. I can dive deeper into this story if you’d like. Shoot me an email at effUmarketing@gmail.com and I’ll elaborate. Again, someone is better than no one. Figure out who you can afford to own and own the shit out of them.

No excuses, be relentless

You need to market you product. Whether you’re busy or not. Whether your marketing budget is in the millions of dollars or hundreds. There’s always a way to reach people. You’ll have to spend some money, but you’ll reap the rewards in the long run. It’s not a sprint, it’s a marathon.

As always, if you need some guidance, reach out to me on Twitter or effUmarketing@gmail.com.

Never stop advertising; be relentless or be dead

henry-ford-quote

I’d go out on a limb to say advertising worked for Henry Ford. He was relentless with his ad dollars and to this day the company he built continues to advertise non-stop.

Coke, McDonald’s, Apple and the Ford F-150 are all category leaders and they all advertise relentlessly. It’s one thing to get to the top, to stay there is even more difficult.

As a small business owner you may say, “Well all those guys have a bunch of money to spend on advertising. I’m just a little guy and I can’t afford that…” All are valid points, but YOU can learn from the big guys. YOU must have some money to market your product.

Find something that works and beat it to death.

You think all the companies above started out with millions of dollars in their advertising budget? HELL NO! They found ONE medium that worked for them, beat it to death, made a ton of money and then branched out into other mediums.

Your advertising budget should be 2-10% of your sales budget. If you have a high margin of sale (most car dealers) your advertising dollars should be around 10%. If you’re a mom-and-pop shop it should be around 2-3%. Notice how EVERYONE should have an advertising budget?

Story time

When I was growing up in Winnipeg, the coffee and donut market was owned by Robin’s Donuts. They had very little competition, so they didn’t advertise much. They did some marketing here and there, but nothing significant. “I’m at the top, so why should I advertise!” Then Tim Horton’s opened up a couple shops. Robin’s still didn’t do much. Then Tim’s opened up more shops and started to advertise…relentlessly. By that time, it was too late for Robin’s. They were too late to the party even though they used to have a strangle hold on the market.

The funny thing is – when people leave, they all leave at once. It’s not a gradual decline. It’s quick and painful. Tim’s took over the Winnipeg market (as it did most Canadian markets) in a few years. Now, Robin’s has a few locations in Winnipeg whereas Tim’s is on every corner. And guess what, Tim Horton’s continues to advertise RELENTLESSLY.

There will be some who say, “Well, the coffee at Tim’s tastes better. Duh!” GO FUCK YOURSELF. You know why it tastes better? Because Tim’s advertises that it tastes better. If you were blindfolded, you wouldn’t be able to figure out Tim’s coffee from Robin’s Donuts coffee. It’s the same thing with wine. I know people who will buy $50 wine glasses because some marketing genius (no sarcasm here, it’s a brilliant scam) advertised the fact that their glasses enhance the taste of your $100 wine. Does it actually work? NO! OF COURSE NOT! In a blind taste test, even the best wine connoisseurs in the world couldn’t taste the difference between wine in a $50 glass compared to wine in a fucking toilet bowl (okay, it wasn’t a toilet bowl it was a $5 glass, but you get my point).

Advertising helps you decide. It plays off your existing thoughts and tricks you into believing what’s right and wrong, what’s better and what’s awful, what wine tastes like in a $50 glass compared to a $5 glass.

This also reminds me of a sports bar that was located across the street from one of the busiest entertainment venues in North America. I was on a sales call with the sports bar manager and she mentioned they didn’t need to advertise because they were always full and they were across from one of the busiest entertainment venues the city has ever seen.

My response, “What would happen if that busy venue opened a sports bar across the street right next to your business? What would happen if they brought their sports and rock stars across the street to their venue for after-parties, autograph sessions, etc…?

The manger kind of shrugged like she didn’t care. She was on top of the world at the moment as people and money were flowing in every week. She was short-sighted. She thought it was a sprint and not a marathon. I’m sure you can guess what happened next. The large entertainment venue sent out a press release stating they were buying up the lot across the street from their venue. They would go head-to-head with the aforementioned sports bar. The money and people going to the old sports bar dried up in less than a year. It went from the top of the hill to six feet under in 11 months. Like I said, YOUR death will be quick and painful if you fail to market your business relentlessly.

Never stop

You may not be in a position to spend the big bucks like the big guys, but you can own a chunk of whatever market you’re in. YOU NEED TO MARKET YOUR BUSINESS. Whether you have $500,000 to spend or $500. If you’re a small restaurant in a small neighbourhood, find something you can own. Whether it’s a street lined with houses or an apartment complex. Print off some coupons (like 50% off or a free appetizer, I will slap you if you give me a 10% off coupon) and deliver them personally or whatever you need to do to own something. If you don’t own something…you own nothing and you will die. Because someone out there with half a brain will figure out you’re not marketing your business. That person will open shop in your neighbourhood, advertise relentlessly and take all your customers.

Want to stay alive? Shoot me a note at effumarketing@gmail.com or leave a comment below.