Video

Email Marketing Best Practices

Email marketing can be annoying for consumers when marketers overdo it, but can be beneficial to everyone when done right. This video addresses 7 main strategies for the most effective email marketing.

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Extra Credit

Extra Credit:  TJ Ciaravino ‘95 presentation on “E-Commerce: The Future of Marketing.

  • Ciaravino discussed that the most difficult aspect of determining which platform to market WorldWide Sport Supply’s online business is determining where their target audience is and the most effective way to market on that specific platform.
  • It is important to keep up with social trends because some social media platforms that were very popular last year may not be as popular this year (i.e. Facebook and Snapchat).
  • Third parties have added great value to the company and have helped create the company’s new website, which has changed drastically over the last 10 years.
  • ex. Bronto- email service provider. It can keep customers engaged with the brand by tracking whether or not they are opening their emails.  If a customer does not open the first email, they will send another email a few days later with a better offer to encourage customers to make a purchase.
  • ex. online chat- if a customer is on the website but has not clicked anything within 30 seconds (for example), a live chat will pop up asking if the customer needs any assistance in navigating the site
  • ex Commission Junction- is an affiliate program that helps more customers by collecting coupons from Worldwide Sport Supply and pushing them to popular coupon sites such as RetailMeNot
  • Signing on with Amazon is a double edged sword because they provided Worldwide Sport Supply with 10% of their revenue, but Amazon customers do not become their customers
  • The best way to have an edge on Amazon is to sell them customized products, so you don’t have to worry about competitors taking potential customers
  • Now, 50% of web traffic comes from mobile devices and so the company has to improve on its social media platforms that are available on mobile devices

Take Home Advice

  • learn how to use Google Analytics
  • read- keep up with business news and current trends
  • keep educating yourself

Case #5: Starbucks: Mobile App

Mission: to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time

Starbucks was founded in 1971 and has  over 17,575 stores in over 55 countries, 62% which are located in the U.S.  With such a huge presence in the market, it’s no wonder they created a mobile app for both Android and iPhone devices.  This free app, which was released in December of 2010, makes the Starbucks experience faster and more convenient for customers.

Starbucks app for iPhones:

  • allows you to check your balance and reload your Starbucks Rewards Card
  • “Shake to Pay” gives you instant access to your card so you can save time in line
  • lets you track Stars and redeem rewards
  • gives you the option to leave a tip for your barista
  • allows you to scan your phone to pay instead of swiping your card
  • allows you to get Starbucks’ “free pick of the week”
  • allows you to save your customized drinks under “My Favorites”, so you don’t have to remember and can just show your barista your order
  • gives you directions to the nearest Starbucks, store hours and services offered

                                    

Starbucks app for Androids:

* Has similar, but not as many features as those offered iPhone app

  • allows you to pay for purchases with Starbucks Card
  • allows you to reload your Starbucks Card’s balance
  • tells you how many stars you have and when you can redeem your “My Starbucks Rewards”
  • gives you directions to nearby Starbucks, store hours, and services offered

                View your Rewards and Rewards history.           Reload your card, set up autopay and more.

My Starbucks Rewards

Starbucks customers can earn Stars when they use their Starbucks cards at any Starbucks, Teavana, Evolution Fresh, or La Boulange stores.  It works like a point system, so the more stars you earn, the better rewards you get.  People with active Starbucks Cards can get a free drink or treat and a 15% off coupon for their entire purchase on their Birthday.  They can also get exclusive offers through text or email if they register their accounts on the Starbucks website. There are two reward levels, green and gold, each offering different rewards.

   

     

Starbucks’ Target Audience

The target audience for this mobile app is any Starbucks customer with a mobile device. Young adults make the largest percentage of Starbucks’ customer base and this section has been growing at about 4.6% per year.  The coffee makes up about 75% of Starbucks’ revenue, but that percentage is expected to decrease with the increase in merchandise and availability of Starbucks products online and at other retail stores.  The following pie chart shows the percent of revenues generated by Starbucks customers: 

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The “other” category includes customers over 40 years of age.  As you can see, this chart shows that a mobile app is perfect for Starbucks because 90% of their revenue comes from customers aged 18-40, who most likely own Androids or iPhones.

Starbucks uses Square Wallet app:

Starbucks uses Square Wallet, which basically makes your phone a wallet.  All the customer has to do is place their order, open the Square Wallet app and click Starbucks, and scan your phone.  Credit and debit card information is saved onto the app

Customer Reviews:

Although this app has been created to make the Starbucks experience more convenient, some customers have found it to be quite a hassle and lacking information about the products that are important to them. Here are some app reviews from the iTunes website:

“New app upgrade is a bunch of crap. First off it doesn’t keep my login info and half the time my password doesn’t even work… Second you removed the easy to access nutritional information and the easy store locator… Also a little concerned about the shake to pay – as it doesn’t work – and now instead of one click to pay it’s three… and why leave my transaction open for two hours for adding a tip – more and more security concerns”

                                                                  – by SomethingCreativeHere

“The new (app) is great, and is a HUGE improvement over the previous, clunky design.  (There’s no need for a menu), there’s a menu there, you can even, you know, talk to the baristas. They are actually pretty nice and knowledgeable. “

                                                                  – by Gan7114

Effectiveness of the app:

The app can be very profitable for Starbucks because it follows the sharing model, which allows anyone with an Android or iPhone device to download it, and the company doesn’t have to pay any fees because it relies on its customers’ bandwith network.  Although there are mixed reviews about the app, I think the star system and overall benefits are great for Starbucks customers.  I’m not a coffee drinker, but if I was I’m sure I’d appreciate a free cup on my birthday and other benefits for being a loyal customer because I’d be more encouraged to continue to spend my money there.  However, I do believe that the payment system has some security issues and is not any more convenient than just pulling out your credit/debit card.  I think there should be some form of human interaction and not just flash the barista with your iPhone that already saved your order, and scan your phone to pay… Starbucks is all about creating a warm environment, and it would definitely be tainted with if everything is replaced by technology.

Sources:

http://www.statisticbrain.com/starbucks-company-statistics/

http://www.starbucks.com/coffeehouse/mobile-apps

https://itunes.apple.com/us/app/starbucks/id331177714?mt=8

http://smallbusiness.chron.com/starbucks-target-audience-10553.html

Case #4: Nike Running – Facebook Page

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Delivering inspiration and innovation to help you run your best 

 

History:

Two ambitious men with backgrounds in running, Bill Bowerman a track and field coach at the University of Oregon and Phil Knight a middle distance runner from Portland, formed Blue Ribbon Sports and placed their first order of 300 pairs of shoes in January 1964.  During Bowerman’s career as a track and field coach, he tried many different things to try to five his runners a competitive edge; one of those passions happened to be designing footwear.  After partnering with Knight, Bowerman ripped apart the Tiger shoes they were selling in hopes to find a lighter sneaker for athletes.  Unfortunately, Bowerman and Knight had full-time jobs and could not focus all of their attention on Blue Ribbon Sports.  Jeff Johnson, a friend of Knight’s from Stanford University, was the solution.  He was the first full-time employee of Blue RIbbon Sports in 1965 and within five years, determined an efficient distribution system, opened the first Blue Ribbon Sports retail store in California, printed advertisements, and came up with the name Nike in 1971.  Knight and Bowerman were mainly focused on athletic footwear and so they created the “Swoosh” brand mark and debuted the new Nike line of footwear in 1972.  With a brand name and logo, Blue Ribbon Sports thought it would be to its advantage to have celebrity endorsement – Steve Prefontaine.  Prefontaine had an incredible track record during college; “he had never lost any race at his home track over the one-million distance.”  He sent sneakers to prospective runners including a note of encouragement and was the face of Nike up until his tragic death in 1975.  After this, Nike transitioned and expanded its marketing campaign by:

  • becoming a publicly traded company in 1980
  • creating a signature design for Michael Jordan in 1985
  • featuring visible Nike Air bags in its new footwear Air Max in 1987
  • creating a tagline for all of its ads “Just do it” in 1988

Now, Nike’s main goal has been to continue innovating to provide the best quality of athletic products, while staying connected with customers on a global scale.  

 

Use of Social Media:

Nike has created a Facebook page dedicated to running.  Its purpose is to inspire, give customers a platform to share their connection with the products, discuss the advantages of their various sneakers, promote features of their new products, share current news from Nike initiatives like Nike Free, and to celebrate the brand in general.  Facebook users can “like” and “follow” the page. Nike has many different pages on Facebook, but Nike Running page has 2,025,352 likes and 62,837 talking the page or its content.  All of the posts are created by Nike, but followers are allowed to comment, like, and share any of the posts.  This strategy gives Nike the power to control their page and provide a focus that customers can feed off of if they choose to do so. The page also gives customers the ability to ask any questions they may have about any of the products such as the Nike Running app, and most of the respondents have had experience with the recent products and so they can help others, and they usually comment on how the products work for them and encourage others to use them.  

Examples of encouraging posts by Nike, and comments from followers:

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 (below, Nike Running also comments – whenever necessary) 

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Applying Evans’ model of the social feedback cycle

Although Nike created the page and the posts, users are free to comment whatever they want as long as it is not offensive in terms of Facebook’s policies.  The posts wouldn’t be as influential without “likes” and support from other Nike customers.  In this case, Nike did its job in generating awareness, but people’s decisions to buy are affected by other followers’ opinions of the products.  

 

Nike Running Facebook Page is achieving all levels of engagement:

  • Consumption – Nike Running Facebook page wants people engage by viewing the page  
  • Curation –  archive the content via “following”, “comments” and “liking” 
  • Creation – followers can post on their own pages and refer to content from Nike Running; users cannot created their own content directly on the page
  • Collaboration – followers can comment on posts by Nike Running and other users can then comment or like that follower’s comments; Nike Running also interacts with followers through their comments                        

                 

 

Video

Dove’s Real Beauty Campaign

Recently, Dove has been promoting real beauty and including your average every-day women in their commercials. Here is an empowering video that does just that. Women are asked to describe themselves to a professional sketch artist (who cannot see them), and this sketch is compared to a sketch drawn by the same man but described by a person they had just met. Most women described themselves in ways that exaggerate facial features that they consider “flaws”. The person they had just met emphasized those features differently, which made the sketch turn out completely different. When the women saw the sketches side by side, they were shocked to see how beautiful others view them.

Case #3: W&P vs Home Essentials: Patent Infringement

W&P’s Mason Jar Cocktail Shaker (left) and Home Essential’s “Original Mason Cocktail Shaker.” Courtesy of: Eric Prum

Background Information: Eric Prum and Joshua Williams “invented a Ball Mason jar fitted with a custom lid that converts into a cocktail shaker” that hit shelves in West Elm stores in November 2012.  In a year, the product, priced at $29.95, made $1 million dollars in sales – very profitable for a start-up company.

Competition:  Customers have been recently complaining about the product, not knowing that it’s actually a knowoff product.  Home essentials has produced and marketed the “Original Mason 16-ounce Cocktail Shaker”, which sells at Bed, Bath & Beyond for $19.99.  The product is very similar to Prum and Williams’ Mason Shaker, but theirs used the original Ball Mason Jar.

Patent Infringement: In order to protect their new creation, Prum and William patented the cocktail in March 2012 – before it was officially on shelves for customers to purchase.  Unfortunately, patents take 29 months on average to be approved.  During the time that the product is on shelves and the patent is being approved, it does not have much protection. Larger companies take advantage of this because even if they are sued for infringement, they can reap the benefits of selling a similar product and pay the lawsuit later.

On Dec. 14, 2013, W&P’s attorney notified Home Essentials that it was potentially infringing on its product. 

Unfortunately, Home Essentials made the case that their product is not eligible for a patent and so there’s no harm in selling something similar to it especially if it will be a cheaper alternative for customers.  Home Essentials has been well-known for copyright and trademark infringement lawsuits, having four in the last 10 years.

Further Issues: Many start-up companies can’t afford the cost of lawsuits, which can be as much as $1 million dollars. In this case, the lawsuit could equal the amount of total sales the company has made. For small companies, a lawsuit can result in a settlement or maybe even an acquisition by that larger company.

Ethical Violation: Start-up companies face enough issues in terms of determining a cost-efficient production process, positioning that product in the market, and gaining new customers.  Often times small business start up with the owners’ personal contributions and so they have already taken on huge risks by investing so much time into creating the business not knowing if it will succeed in the long run.  The last thing that a start-up needs is a larger company to steal its customers.  In this case, Home Essentials seemed to provide a knockoff that was less quality and so customers who associated that product with W&P have an altered perception.

It is unfortunate that the patent has yet to be approved and although W&P claimed that their revenue hasn’t been affected, there is a high possibility that customers will choose the less expensive alternative. Since Home Essentials sells the product in Bed, Bath & Beyond, W&P has lost a potential marketing outlet, which could have made them even more money since the store is known for selling high quality household products at an affordable price. It is definitely an ethical violation for larger companies to take advantage of vulnerable start-ups who may not have the funds for a patent and are still in the process of building their brands.

Moving Forward:

  • Wait until patent is approved before taking any further action.
  • Continue to build the brand.
  • Make sure customers are aware of knockoffs.

Source: Million-Dollar Startup Threatened by Copycat