Honey! I shrunk the consumers

Thursday, June 22, 2006

“Our families rejoice – a new life’s begun. Our circle is richer with the birth of this one!” A happy couple sent out this card when their precious bundle of joy arrived in this world. Little did they realize that along with them, LG, McDonald’s, Whirlpool, Surf Excel rejoiced too. A consumer was born!

Yes its true; today, the age of the target segment seems to be shrinking. Advertisers are realizing the urgency of targeting children while they are still in their diapers; lest some competitor should snatch them away. Advertisers are making their pitches to younger & younger audiences. Today, the age of the target audience has dropped down to two years. No wonder, recent studies have shown that children as young as 36 months can recognize an average of 100 brand logos. According to the Center for a New American Dream, babies as young as six months of age can form mental images of corporate logos and mascots. So, by the time they are 2 years old, they could very well become your loyal consumers. They are, after all, your future breadwinners, and hence worth investing on today. Going by numbers: from $100 million in 1990, today the spending on advertising to children has increased to more than $2 billion. An early bird catches the worm – and marketers are starting as early as possible.

“No means no...” But actually not for long; and every child knows that. They have to just keep on asking till parents give in and buy them what they so desperately want. This “keep asking strategy” is reaping rich dividends not just for children, but for marketers too. They have, in fact, quantified it too. On an average, kids have to ask nine times till their parents give in. That’s for the ones who are 12-17 year old. The younger ones are even more persistent. They don’t hesitate to ask for the same thing more than fifty times. It takes enormous will power to refuse fifty times... and parents do give in. Marketers apparently had never underestimated the ‘power’ of a whining child; and those who have used this ‘power’ have raked in the moolah too. So all you do is keep the ads coming, and wait for the child to change the “No” to “Yes”.

just for kids

“I love you Rasna,” cooed a cute moppet, and soon every child wanted to drink Rasna. But that was a long time ago when things were simpler and little kids played with little cute toys. Today, it’s the era of ‘Beyblades’. Anyone with a child in the age group of 4 to 14 years knows what I am talking about. Rasna has done it again. It has once again managed to hook its target audience. It has started India’s first Beyblade Championship. As the little ones imitate their favourite Beyblade characters (“Tyson” and “Ray”) and many more, the company is all set to count the money. As the Beyblades start spinning, so do fortunes, and Rasna and the kids shout in unison, “Three, two, one, ho ja shuru!!!” Even ICICI is not far behind Rasna. It started the “Young Stars” account. No marks for guessing their brand ambassadors – Tom & Jerry. They captured the hearts of generations of youngsters & today are capturing their wallets!

The charm of a child is irresistible and no one knows it better than a mother and a marketer... and of course, McDonald’s! From the ambience of their outlet, to their concept of “Happy Meals,” this intelligent firm has made sure that kids drag their parents to McDonald’s outlets every time they want to eat out. The 2 billion dollars that McDonald’s shells out every year sure seems to be effective. So the Indian version of McDonald’s – Nirula’s – is trying to catch up by offering free ice-creams to students who have excelled in their examinations. Novartis decided to go a step further with its best seller Calcium Sandoz. It went directly to schools in Ahmedabad and distributed Calcium Sandoz in doggy packs along with doggie eraser, scale and pencil. After all, it pays to catch them young.

We are the world; We are the children...

The future of mother earth rests on the tiny shoulders of young children. So does the onus of building market shares in today’s business era. Today, competitors are using these tiny people to fight it out with their competitors in the market place. Who would have thought that purchase decisions on products like cars, washing machines and washing powders would be decided by children! But that’s a fact. Today, children decide almost everything, and parents are too stressed and short of time to hold their ground. Today, children are more aware about products and brands available, than even their parents.

Today, those are kids who decide whether they want a stylish car, or a big car, or a fuel efficient one. So while Maruti Suzuki shows an irate father shouting, “Oye Chhote bas kar yaar,” to stop his child from driving his toy car all over the place, the smart Chhote chirps back, “Papa ki karan, petrol khatam hi nahin honda!” The father slaps his forehead in awe and appreciates the lad and calls him a champion. Hyundai Santro knows that the little girl who gives away all her piggy bank saving for a “maroon car” will have her way. So, while the whole house wishes for the black, it’s got to be the maroon which the loving “Chachu” Shah Rukh gets for his loving niece. “Hoga Har Sapna Sakaar” promises a Santro to all the little decision makers.

If that were not enough, it’s not just the colours, but the size of the car which is decided by these lilliputs. So, when the school girl says that Maruti Esteem is a big car, her father feels he’s done well in life and smiles. Not to be outsmarted,

Indica advocates, “If you can’t have it, snatch it.” So the little sweetheart runs away with the bigger car of another boy. After all, it’s only human to want more, and Indica gives more. Be it mileage or comfort or color or style, kids know it all. Marketers are waking up to this fact. So, Surf Excel did not hesitate to give up the hard working, thrifty Lalitaji in favour of the charming brother who fights with the puddle that made his sister cry. Sachin and Shah Rukh were unable to pull it off alone, and Britannia and Sunfeast have to use the charms of two little naughty boys to convince the kids to buy their biscuits. If you have to win a trophy, eat a Sunfeast biscuit. If you want to be naughty, you need the energy of Britannia Tiger. And if you have to outsmart the adults, have a Parle-G. It’s no more just star power, but kid power, which makes ads work today.

While for all these years Horlicks used to talk to mothers about nutritious value of their products, now its “Aipong, Opang, Jhapang” for the smart child who needs no one to convince him what’s good for him. The mother just stands and appreciates the choice her child makes. All these years Colgate had been the market leader with its famous “Ring of Confidence,” which kept the family and the company’s market share safe. When competitor Pepsodent came in, it talked directly to the child and promised him that his mother would allow him all the things which were not good for his teeth, because Pepsodent would fight away all the germs. It was not just the germs, but also now “Dhishum-Dhishum” for Colgate’s market share and it learnt its lesson well. It tried hurriedly to scramble back with the help of a tiny kid’s voice that said “Mera Colgate. Meri big Suraksha.” Kids are a force to reckon with – you can’t ignore them. It’s a fact that kids influence 43% of the brand purchase decisions. Advertisers are pulling out all steps to keep kids surrounded by advertisements. India’s top advertising spenders are those whose products are consumed predominantly by children. Nestle tops the charts, followed by Britannia and Cadbury.

The New Movie-Goers


Back in 1977, little boys carried “Howdy Doody” lunch boxes to school, after watching “Star Wars.” No one could imagine back then the amount this industry would grow. We all know that the five “Star Wars” films grossed nearly $5.7 billion in box office sales worldwide. However, what skipped the attention of many was another stunning number. Toys and merchandise sales of the movie were a staggering 9 billion dollars. Add to this another $4.3 billion towards video games and DVD sales. Every hit movie spawns a whole new set of toys for children. Toy Story almost spawned a mini industry in Buzz Lightyear merchandise. Months before a Harry Potter film hits the theatres, the sale of its merchandise goes to dizzying heights. Harry Potter is so much of a craze that Bajaj Discover has used a look-alike to promote the sale of its bikes in India.

On the Indian turf too, “Koi Mil Gaya” captured the imagination of thousands of young children as they flocked to the movie hall with their parents and later bought “Jadoo” merchandise. Kids are so important today that movie makers are writing scripts and action directors are directing action scenes so that they can be converted into video games for children. It said that action sequences of Star Wars were tailor-made for video games. Be it Charlie Chaplin, Mickey Mouse, or Laurel & Hardy, all the movies which entertain kids were always very popular. However, George Lucas with his Star Wars showed the world how to build a fortune too! No wonder, instead of a pay rise, he was happy when 20th Century Fox gave him the merchandising and sequel rights of all the Star Wars films!

Hi-tech Boom

No time for parents to buy you a pet? Don’t worry children, all you need to do is log on to neopets.com, and own a virtual pet, all yours to love and to take care of in just a few seconds. This website is loaded with games full of opportunities for brands to tout their logos & ads. Today, this site has around 11 million users. Children prefer it to watching TV. The Neopia food shops sell Nestle sweets, Oreo Cookies et al to name a few. The Disney Theater link on this site shows cereal ads of General Mills. So, as children take care of their pets, they get familiar with various brands without even realizing it.

Postopia.com is another of those gaming sites where brands have linked their names to games so that children don’t forget them. We don’t need no education

Kids are glued to their TV sets. Most have one in their bedrooms. An average child sees 20,000 commercials every year. They are exposed to so much, so soon, that by 3 years, many are demanding products with specific brand names. It’s no surprise that children know more about Ronald McDonald than about their local heroes. Just when you thought you could turn off the TV and switch away your problems, you have Channel One. It offers a 12-minute news broadcast daily to more than seven million teens across American schools. Advertisers are ready to give their right arm to be a part of the commercial break that comes with this 12 minute news broadcast! Channel One does not hesitate to charge $195,000 for a 30 second ad. Where else would you get such a large captive audience!

Marketers are running helter-skelter to find ways to tap this burgeoning market. Kids surely are the new consumers. According to an estimate, 24% of the US population are kids, and the figure is estimated to remain stable till 2020. Clearly, marketers are finding newer ways to reach out to this huge market and communicate to them. So put on your Harry Potter glasses and start thinking-small, for honey, we just shrunk the consumers!

"BEND IT LIKE BECKHAM"

Thursday, June 8, 2006

It’s being touted as the most lucrative sporting events of all times. If the favourite teams reach the finals, then the final match alone would attract as many as 300 million viewers!

That’s a very large number that we are talking about and its driving marketers into a wild frenzy. Corporates are bending backward to grab a piece of the action. Everybody wants to be associated with the World Cup. Some by paying millions, and others by using clever marketing tricks! Afterall, FIFA is one global stage where each corporate is vying for centre stage. Everyone wants to be associated with this heartthrob event. Around 1,600 members of the global media would be in Germany to cover the event. This translates into tremendous visibility to all associated with the event. Football will no more be just a game in June 2006. It will be metamorphosed into a world-class artistic and cinematic event. Heart-warming images would be showcased everywhere – on TV, in the newspapers, on internet – for the audience to relish and enjoy. Carefully crafted images will be doled out to feed the insatiable appetite of frenzied fans, and marketers.

15 main sponsors, 6 national promoters and a cast load of licensees, have together contributed some €700 million to FIFA. That’s not much considering the fact that the 2006 FIFA World Cup holds promises of capturing the attention of the entire world. Over 38 billion viewers are expected to watch the event during June and July. They would also be watching and enjoying various promotional activities being undertaken by various companies. Not surprising then, that the 15 official FIFA World Cup sponsors were ready to shell out $30-50 million, each, for the right to officially use the logos and branding, and hence grab a share of the limelight.

THE UNOFFICIAL

If you can’t use it officially, then use it “unofficially”, for no one can afford to stay away from this event. The world’s most creative advertising agencies are at their seductive best to grab the attention of the viewers. Everyone knows the reach of this event is tremendous. If you want to target young men this year, this is the event for you.

So if Pepsi, Nike and Carlsberg could not make it to the “official sponsors” list, they have a plan up their sleeves to help themselves win the hearts of this huge TV audience. Nike has used the innocent childhood images of Brazilian star, Ronaldino, to waltz straight into your hearts. Carlsberg on the other hand, decided to use the old heroes of the 1996 World Cup, who it showed enjoying a well-earned pint of Carlsberg after winning a game of football.

Once bitten by Pepsi’s “Nothing Official About It” campaign of 1996, Coca-Cola is leaving no stone unturned to ensure that its arch rival stays out of the stadium, the TV and even the minds of the fanatic fans. It has bought the in-stadia rights for the cup. It has tied up with Adidas to distribute soccer memorabilia. Thus, ensuring that Pepsi does not get a chance to pop-out from anywhere. To top it all, Coca-Cola India is an associate sponsor of ESPN-Star. So viewers in India, Pakistan, Nepal, Bangladesh and Sri Lanka would only get to see Coca-Cola ads on the TV screens during the matches. Pepsi, the virtual owners of cricketing events in India, are not disappointed. They are glad to stick to cricket, which is “the” sport of India. However, considering 75 million Indians watched the soccer World Cup four years ago, one wonders if Pepsi’s optimism is a wee-bit fake. It sure seems to have lost to Coke this time.

While Addidas paid millions, it’s Nike, the “unofficial sponsor”, which is once again hogging all the limelight. Just the way it did in 2002. Adidas, a German company, is going all out to block Nike ads. It would be too embarrassing for it to lose the advertising battle on its home turf. Not to be deterred, Nike has gone ahead and teamed up with Google to create the first social network for the fanatic football fans called “Joga.com” (joga bonito in Brazil means “play beautifully”), where it expects millions of people to register. Today “online” is the “lifeline” of young people, and thus, they believe, would be more effective than the traditional way of advertising. So while Nike is trying to even out with Adidas, Google is trying to settle scores with Yahoo – one of the official sponsors of the World Cup.

Back in 2002, Elvis, once again gave a hit, all thanks to Nike who used a remix version of his very popular song “A Little Less Conversation” for their ads, where they created a “secret tournament”. The ads were so popular that the Elvis song topped the charts and became the number one hit that year. Nike ads were more popular than Adidas. To top it, that year Brazil (Nike sponsored team) beat Germany (Adidas’ home team). This year, Adidas is taking no chances. It’s spent $200 million on its “+10” campaign, which shows how anyone, plus ten players, makes a football team. Its kid, Ronaldinho (Nike ad), vs. kids, who make their football team (Adidas ad). Let’s see who wins.

Lufthansa has dressed up 40 of its aircrafts by putting football decalls on their nose cones. So, even though Emirates has paid the millions to FIFA, it’s Lufthansa with its football nose that seems to have stolen the spotlight!

Afterall, it pays to be associated with the World Cup. So the Swiss Tourists Board has started luring visitors with an ad, which goes like this “Dear girls, why not escape this summer’s World Cup to a country where men spend less time on football and more time on you?” Well, worth a thought ladies, when you have brawny lumberjacks, and Mr. Switzerland 2005, extending the invitation.

THE OFFICIAL

Old, hackneyed phrases and mundane themes will not work this time. You’ve got to be different to be noticed. It’s estimated that about €2.5 billion would be spent in Germany on advertising. One can just imagine the onslaught of ads, the viewer would be subjected to. According to One Publicis, the media-buying unit of Zenith Optimedia, global ad spending would increase by 6% this year, to $429 billion due to the World Cup. With such an amount of advertising frenzy, it’s obvious, only the good will survive.

So Master Card spent 32 days to shoot its ad, which ends with “football fever. Priceless” 100-odd fans were shown cheering from 30 different countries.

Gillette has a spot, which shows fans wearing the colours of their team and carrying the national flag. Depending on where the ads will be aired, the company plans to digitally alter the colours to match with those of the country where they are being shown. Budweiser has decided to play it safe. It’s an American brand, and Americans have a reputation of having no football knowledge. So very intelligently it’s come out with the slogan “You do the football, we’ll do the beer”. At this point, no one wants to mess with others’ sentiments.

FIFA has signed agreements worth more than $888 million with its various partners and sponsors. For a whole month it would command the viewership in 189 countries, thus making it a very powerful body. It’s laying the rules and everyone is following them. So from June 9 to July 9, the AOL Arena would change its name to FIFA World Cup stadium, Hamburg. It would cost the German authorities half-a-million euros as settlement charges to the stadium sponsor AOL. Twelve German stadiums would lose their official names for the next one month, since they are not the official sponsors and FIFA does not want them anywhere near its game to give them even an iota of publicity. Otherwise, no one would shed those millions to become their official sponsors. Hence, within a kilometer of the 12 stadiums, FIFA forbids the appearance of any logos & advertising of non-sponsors. To complicate matters further, FIFA has demanded that no public events be held on match days

THE UGLY

FIFA needs to take care of its sponsors, for them to take care of it. The 2010 world cup would have only six worldwide partners, unlike 15 this year. One would need $125 million to belong to this elite group. The kind of mega exposure, this event guarantees, it’s not surprising to find sponsors already fighting for that coveted title of “partner 2010”. Not just the 2010, but companies like Budweiser have booked themselves as the official sponsors of the 2014 FIFA world cup, too.

With the rising popularity of sports, it’s the corporate sponsors who have become more powerful than the federations which govern them. These are the companies whose annual revenue is several times the GDP of smaller countries. They are the ones who put millions at stake and want every penny’s worth of return. Sometimes, things take an ugly turn too. Nike sponsors the Brazilian soccer team only because of Ronaldo. It could not afford to allow him to rest, even though he suffered from convulsions the night before the 1998 world cup final. He had to fight it out in the field with Adidas sponsored Zinedine Zidane, else Nike would lose its millions. In order to ensure that the match between Nike and Adidas, oops sorry, between Brazil and France goes as planned, they didn’t hesitate to pump Ronaldo with pain killers and force him to play.

THE MONEY

“Sports” is no more just sports, it’s a merchandise, and the players are peddlers of the goods of their sponsors. When Ronaldo plays, some 2000 jerseys with the number used by him during the game, are sold everyday.

Beckham is a brand to reckon with. Today his hairstyle gives him more media coverage than the number of goals he scores. He has sold sunglasses for Police, clothes for Marks & Spencer, cola for Pepsi, mobiles for Vodafone and now, for $9 million, he would be the face of Gillette for three years. Analysts estimate, he is a brand worth $375 million.

Sports celebrities are demigods today. On the Indian turf, you have sponsors dancing to the tunes of tennis-sensation, Sania Mirza. When she encountered Maria Sharapova, the advertisement rates of that match shot up by 15% in India. She was specially assigned one of the three show courts so that the game could be telecast directly to India, where many were staying up late to catch her on TV.

Cricket is the second religion in India and cricketers are worshipped, by both the fans and the corporates. Sehwag endorsed Dabur tooth powder and stopped the drop in its sales. In fact, the ad recall of the brand increased by 40%.

Sports stars guarantee television exposure of corporate logos when they play their game. That’s what all sponsors are looking for. The rules are straight, if you play well you earn not just fan adulation, but sponsors too, who will ensure that you and your fans wear their brand! The sporting-goods industry is estimated to be over $ 600 billion, which is more than the GDP of many countries. If we do a little more number crunching then consider this, in 1993, $9 billion worth of goods were related to sports, and the top three television networks generated $2.2 billion worth of sports related advertising while the cable networks generated $800 millions.

Every successful star, every and successful sporting event generates millions for the sponsors. When Japanese football games were aired on TV, Fuji Bank got one million new depositors that year! Business houses don’t hesitate to own or purchase sports teams, be it soccer or baseball or basketball. As long as they can be marketed, it’s okay. As long as people remain passionate about the sport, corporates will rake in the moolah. As the D-day nears, you will get to witness some adrenaline pumping action both on-screen and off-screen. Watch out for the sponsors, and see how they bend it better than Beckham!