Monday, January 31, 2011

Mattress Wars Get Hot and Heavy

I read with great interest that the mattress folks have gone to the mattresses. Sealy and Simmons are at war over the fact that the former is introducing a new line with its coils encased in fabric. "Pocketed coils," or "Marshall units," as they are known among bedding wonks, have been the latter's shtick since forever, which is to say 1924, giving it the famous bowling-ball-on-the-bed positioning.

It may not be as bloody as a battle between warring Mafia families, or as ruthless as campus politics, but the snarky insults were flying back and forth in The New York Times.

#1 Sealy doesn't think giving its consumers another option is such a big deal, Stephanie Clifford reports. "To say it's not a major shift -- of course it is," Simmons CEO Gary Fazio fires back. "Do you not have faith in the brand promise you're making?"

"This, to me, feels like the competition is just aggressively going after this," Sealy CMO Jodi Allen tells Clifford. "Consumers could, really, to be honest, care less."

We've been shopping for a new mattress for, oh, about a decade. Maybe more. Not that there's anything particularly wrong with the full-sized Sears-o-Pedic Dream Velvet polyurethane model we purchased more than 25 years ago -- except that it has gotten smaller by dint of the two cats and one pit bull insisting on their territorial rights where human legs have every right to go.

There have been intense active periods and long passive stretches where we just gave up looking. Nothing has been more difficult in our lives to sort out. Not a house. Not colleges. Not financial services, automobiles, computers, cell phones, surgeons or bottled water. A little newspaper in the countryside where the deadlines are later than 7:30 a.m., perhaps, but that's another story.

It all started when I became enamored of Tempur-Pedic ads circa 1990. I got on their mailing list. They must have spent more than the cost of an original twin-sized bed, with a few memory-foam pillows thrown in, trying to get me to buy. The marketing material sounded so...right. I can't give you specifics but I remember walking around for years thinking that I was spending about a third of my life (eight hours a night) on a mattress and I deserved, by golly, to have those eight hours be as restful and restorative as possible, no matter what the cost.

(Make that should be spending, according to sleep researchers; unfortunately maintaining the lifestyle that such aspirational thinking supports means that I've actually been spending, like most Americans, about 25% [six hours] of my lifetime sleeping and a good portion of the rest of it earning enough to pay off previous my aspirations.)

Anyway, I never pulled the trigger on Tempur-Pedic's many glossy, 90-day free-trial offers. In the end, whatever I bought would have cost at least five times more than the Sears-o-Pedic Dream Velvet and the trusty captain's bed we'd gotten at an unpainted furniture store to support it. Plus, I didn't think I'd have the guts to return it if I didn't like it. And when I finally lay down on a memory-foam Tempur-Pedic in a Sleepy's, I felt I was mired in pond muck. But that's just me. From polls I've seen, the vast majority of memory-foam purchasers feel good about their mattress.

Let's go back to the cost factor for a moment because, truth be told, that's what's really been separating us from a purchase. I Googled "Why do mattresses cost so much?" and came up with some interesting insights. Superior technology costs more. There's more steel in the inner-spring mattress than there used to be and steel is expensive. Government regulations drove up the price (what, you think it doesn't cost money to produce models that don't go up in flames every time you drop a lighted cigarette on it?).

Then there's the fellow in Arizona who sells "eco-friendly" latex mattresses, purportedly at a price far better than the competition. He says the new latex models are "just bad for business due to their durability." Bottom line: the major manufacturers ratchet up the price because they're not getting the repeat business they used to get. His marketing philosophy is "maybe not, but if you like my deal, you'll tell your cousin Vinnie."

Good ol' Consumer Reports says that the margins are usually higher for mattresses than any other product in a furniture store, with gross profit margins of basic models as high as 30% to 40% each for wholesalers and retailers. And those deluxe versions carry margins as high as 50%. You can read more about "Eight Mattress Mysteries" (including the difference between a "warranty" and a "comfort guarantee" if you have a subscription).

But what Consumer Reports editors won't do is make a recommendation. Despite extensive testing on memory foam, air, latex and inner spring models, they beg off with the "it-all-comes-down-to-individual-preference" demurral.

I did find one fellow who has compiled a bunch of those individual preferences into a database that names names. When he made this very helpful YouTube video, he'd sorted through 8,300 responses. (I'm not sure, as a marketing wag, that I'd have advised him to use SleepLikeTheDead.com as a brand name, but that's what separates the commentators from the doers.)

Nick Robinson now has collected nearly 14,000 "consumer experiences" about a whole bunch of foam-memory, air, latex, coil-spring and water-bed brands, as well as ancillary products like mattress toppers, electric blankets and dog beds (yeah, right, who uses those?). The models are rated in a number of categories including price, durability, motion isolation (do you get seasick every time hubby rolls over?), allergies and "less pain."

On the grand scale, memory foam, air and latex all score around 80% in user satisfaction. Inner-spring mattresses -- the mainstays of Sealy's and Simmons -- come in at 61%. There was only one category in which users rated inner-spring mattresses better than air, latex or memory foam. Sex.

I'm not going to go anywhere with that. I'm just surprised that the mattress companies haven't. In fact, and surprisingly, no mattress advertising I've seen would get anywhere near a "C" rating from the Legion of Decency. Except, perhaps, anything for Bob's Discount Furniture's Bob-O-Pedic. There's nothing salacious about it. You just have to condemn it out of, well, aesthetic decency.

(Source: Thom Forbes, Marketing Daily, 01/27/11)

How You Can Make Money:
An advertising war between Sealy and Simmons means better results for the retailers who take advantage of their co-op programs. It's time to start talking to those retailers about the power of theatre-of-the mind and the benefits of your station before they allocate those funds to print, direct mail, or television.

Monday, January 24, 2011

Why Harley Is Showing Its Feminine Side

Motorcycles September 30, 2010, 5:00PM EST text size: TT
Why Harley Is Showing Its Feminine Side
Harley-Davidson has felt the economic downturn keenly and is increasing its female-targeted marketing efforts this year

By Mark Clothier
BW Magazine



On a stormy Tuesday night in late September, Linda "Jo" Giovannoni was busy making preparations for a women-only "garage party" at the Palatine (Ill.) dealership of Harley-Davidson, a company best known for its big motorcycles that appeal primarily to aging white males. That evening Giovannoni, marketing director at the suburban Chicago dealership and a co-founder of Harley Women magazine, was out to change that perception among the dozen or so women who showed up to share snacks, overcome fears, and talk cycling. Giovannoni led the women on a tour of the showroom, crowded with $15,000 bikes, and gave them advice on essentials such as how to fit a helmet and the proper accessories to customize their rides. One partygoer, 55-year-old Jo-Ellen Douglas, had ridden with her husband for years. "I was just happy to be on the back," she said. "Now I've decided it's my turn."

Harley, still reeling from the weak economy, has increased female-targeted marketing this year to attract more would-be riders like Douglas. In July it introduced the $8,000 SuperLow, designed to appeal to women and first-time riders. The SuperLow has the lowest seat in Harley's 32-bike lineup, making it easier to ride, and it's 150 pounds lighter than a typical Harley.

A bike more suited to women is something Harley customers have long been asking for. Chief Executive Officer Keith Wandell saw that firsthand at a riders event in Orlando on his first day on the job in May 2009. "Ten questions were asked and nine of them were from women, and all of them were really asking the same thing: When are you going to design a bike that's more suitable for women riders?" Wandell recalls.

The company certainly needs additional sources of growth. New motorcycle registrations have fallen 41 percent since 2007 overall and 36 percent for Harley. The company's production has sunk to 2001 levels. And about a fifth of the bikes Harley ships today are Sportsters, the smaller, less expensive (and less profitable) models. To help address declining volume and product margins, Wandell spent his first 19 months in office reworking labor contracts at Harley's plants. The new agreements give new employees fewer benefits and let the company add and cut workers based on demand. Wandell also got rid of non-Harley bike brands such as MV Agusta and Buell to focus on its namesake icon, which traces its roots to 1901.

Women riders now represent about 12 percent of Harley sales compared with 2 percent in 1995. The brand also has a 53 percentage-point market-share lead among female riders and has the leading share for people aged 18 to 34, Hispanics, and African-Americans, other groups it's courting, the company says, citing researcher R.L. Polk's data.

Harley-Davidson has 47 percent of the U.S. market share for on-road motorcycles through July, a one percentage point increase from last year, according to Polk. Kawasaki Motors is second, with 14 percent.

To help attract women, Harley in 2008 hired Marisa Miller, who has modeled for Victoria's Secret and Sports Illustrated's swimsuit edition, as a spokesperson. In addition to appealing to men, Miller, whose riding skills can be seen on YouTube, helps Harley draw female riders, Wandell says. "It says, look, this is real stuff," he says. "A lot of women ride bikes, and here's a Victoria's Secret supermodel riding bikes and doing burnouts. It was strictly intended to send that message." The marketing effort, part of a doubling of spending since 2007, complements the introduction of the SuperLow, which, in addition to black and other traditional Harley colors, comes in Merlot Sunglo.

Harley and its dealers are also working to overcome some women's apprehension about safety. A few evenings a year, many of Harley's 650 U.S. dealers close their stores to men and hold women-only parties where staffers try to demystify a 700-pound motorcycle. The company held about 500 such events in March, attracting 27,000 women, 11,000 of whom were in a Harley dealership for the first time. The company says it sold 3,000 bikes from the events that month.

Turning age 50 brought Joanne DeGennaro, an office administrator for an orthopedic surgeons' group, to Giovannoni's garage party near Chicago last month for her first time on a bike. "I had been conservative and in a career where I've seen very bad injuries from these types of things," she said. "I have no idea what I'm doing. I mean the weight of it just intimidates me, you know?"

That night, however, she was able to sit on one of Harley's smaller bikes, a Sportster, with salesman Mike Parth showing her that it's easier to lift the 550-pound bike off its kickstand by turning the front wheel to the right. She said she now plans to sign up for Harley-Davidson's training class and get her license. "Considering the type of work I'm in, I'm apprehensive because I see the gooey stuff that we fix from these accidents," she said. "But I just decided, you know what, I've got to start living for myself."

The bottom line: With motorcycle sales in a slump, Harley-Davidson is boosting its efforts to attract more female riders.

Clothier is a reporter for Bloomberg News.

Agency Survey Shows 'Rebirth' of Buyers' Interest in Radio

A survey of advertising agency buying teams finds fewer are cutting radio budgets, and client interest in the medium is growing. STRATA executives say the top three media -- television, Internet and radio -- also appear to be the breakout hits of the advertising recovery.

"It's looking very bright for radio," STRATA marketing chief J.D. Miller told Inside Radio. The firm's quarterly survey of buyers found 24% of agencies' clients are more focused on radio, up from 17% in the prior quarter. The number of agencies reporting they are spending less on radio is off by half -- 17% say they're trimming radio budgets compared to 34% who said that three months ago.

When it came to classifying the advertising avenue that agency clients are most focused on, the STRATA survey found TV remains at the top with 44%, followed by digital at 21%. But even the survey takers were surprised with #3: radio. The results show 16% of clients rate radio as their top pick, compared to 9% who said that in the prior quarter's survey. Miller says, "Something good is happening for radio."

Beyond the top three, there's a "considerable drop off" of interest in other media. Print ranks fourth, with 7% of clients making it their top pick. Miller says that could be considered good news for newspaper publishers. "Print has a pulse -- it was almost nonexistent, now it has a pulse," he says.

Agencies Grow More Confident in Recovery -- and Old Media Friends

By their nature, media buyers are a tough crowd not known for gushing optimism. So when a survey shows a steady uptick in client activity, it's worth taking note.

More than half (51%) of buyers surveyed by STRATA say their agency is seeing improving business, up from a low of 23% during the 2008 economic meltdown. STRATA president/CEO John Shelton says, "Advertisers are finally feeling more confident about the economy."

That confidence is manifesting itself in a surprising way. As budgets come back, buyers appear to be more interested in traditional advertising like television and radio -- with demand for digital advertising going in the other direction.

"We see that the focus on digital has fallen off a bit," Shelton says. "While still hot, it is used more in a solid media mix than more dollars heading its way."

The most popular digital menu items are website display ads, social media and search. Mobile may have buzz, but just 29% of buyers say they're buying mobile ads. Among those who are, mobile display is the preferred format with SMS text ads fading fast. Just 15% of agency buyers say they're on their radar in 2011.

(Source: Inside Radio, 01/21/11)

Friday, January 21, 2011

Survey Finds 51 Percent of Men Are Primary Grocery Shoppers

Mom is losing ground to Dad in the grocery aisle, with more than half of men now supposedly believing they control the shopping cart. The implications for many marketers may be as disruptive as many of the changes they're facing in media.

Through decades of media fragmentation, marketers of packaged goods and many other brands could take solace in one thing -- at least they could count on their core consumers being moms and reach them through often narrowly targeted cable TV, print and digital media.

But a study by Yahoo based on interviews last year of 2,400 U.S. men ages 18 to 64 finds more than half now identify themselves as the primary grocery shoppers in their households. Dads in particular are taking up the shopping cart, with about six in 10 identifying themselves as their household's decision maker on packaged goods, health, pet and clothing purchases. Not surprisingly, given that such ads long have been crafted for women, only 22% to 24% of men felt advertising in packaged goods, pet supplies or clothing speaks to them, according to the Yahoo survey.

The Great Recession has thrown millions of men in construction, manufacturing and other traditionally male occupations out of work and by extension into more domestic duties. At the same time, gender roles were already changing anyway, with Gen X and millennial men in particular more likely to take an active role in parenting and household duties.

Of course, in the survey, men could be overestimating their own role in shopping for the family. Lauren Weinberg, director-research and insights for Yahoo, acknowledges that could be possible -- and that women don't see them making as much progress on that front. But she said the fact that so many men now see themselves as masters of the shopping cart not only reflects real shifts but also means any stigma once attached to men as shoppers is fading fast.

Yahoo's interest in the subject is obvious: The portal has a lot of inventory geared toward men, such as page after page of fantasy-sports content, that could use more advertisers. But its research on men nonetheless seems to describe a new and disruptive reality.

Behavioral research of shoppers shows a number more like 35% of grocery and mass-merchandise shoppers are now men, said Mariana Sanchez, chief strategy officer for Publicis Groupe's Saatchi & Saatchi X. That number has been growing thanks to the economy and changing gender roles, she said.

And while that figure may be far from a majority, the fact that a third of a brand's shoppers are male is an awful lot to ignore. As a result, shopper-marketing efforts are increasingly gender-neutral rather than targeted for female shoppers, Ms. Sanchez said.

A subtle case in point came during the latest Procter & Gamble Co.-Walmart collaboration on "Family Movie Night," Jan. 8 on Fox. The program itself, "Change of Plans," did show a new dad more domestically impaired than a mom when unexpectedly thrust into adoptive parenthood. But in the commercial pod "story within a story" via Martin Agency, Richmond, the dad made a shopping trip to Walmart to load up on P&G and private-label Great Value products.

Such scenes could be a wave of the future for more categories as consumer packaged brands must elbow their way past car insurers, pickup trucks and erectile-dysfunction drugs into one of the surest and most-DVR-proof forums for reaching men: football.

P&G's Head & Shoulders and Prilosec already have become deeply involved in NFL marketing. But most P&G brands still primarily target moms, and it's not always easy to please both. While last year's tear-jerking "Behind Every Olympic Athlete is an Olympic Mom" Winter Olympics ads for P&G from Wieden & Kennedy were generally well received, the Twitter stream about them included an undercurrent of resentment from dads, who still make up the vast majority of volunteer coaches for youth sports.

The shift toward male shoppers, of course, didn't happen overnight, and that may also help explain why some brand managers for years have privately said more broadly focused network prime-time programming delivered better for their brands than more female-focused cable buys, regardless of the cost and what media optimizers indicated.

Perhaps favorably for marketers, Yahoo research finds men are more brand-loyal and less focused on promotions than women shoppers, Ms. Weinberg said. In advertising, they do more product research in packaged-goods categories than women, she said, and, because they're often newer to the categories, prefer ads with more information.

John Badalament, author of "The Modern Dad's Dilemma" and operator of ModernDads.net, does see more ads that speak to men, including recent ads for P&G's Old Spice and Kimberly-Clark Corp.'s Huggies. But many ads featuring men still portray them as hapless domestically, which he doesn't believe helps marketers. He likens such ads to the once laughable, now anachronistic grocery scene from 1983's "Mr. Mom."

"Men," he said, "need to be something other than invisible or buffoons in advertising."

(Source: Advertising Age, 01/18/11)

Tuesday, January 4, 2011

Study: Americans Eager for 2011 Workouts

While marketers can always count on vows to "exercise more" to be right up there with "lose weight" and "quit smoking" this time of year, there are signs that Americans really are looking to celebrate economic recovery with a little more time at the gym. A new survey from 24 Hour Fitness reports that 72% of consumers say they hope to exercise more in the New Year.

Younger people are more gym-bitious: 81% of adults 25 to 34 say they expect to be more active this year, compared with 73% of those in the 35-to-44 age group, and 65% of the 55-to-64 crowd. No matter the age, weight loss is the main motivation, with 36% saying that shedding pounds is their No. 1 goal, while 35% say their main motivation is simply looking better.

That's good news, since the latest Gallup data says only 38% of people it polls report having exercised or having a lot of physical activity in the past day, and only 27% get the recommended 30 minutes or more of exercise five days per week.

January is one of the busiest times for gyms, and low-cost chains like 24 Hour Fitness and Bally's typically run specials that include free seven-day trial passes. But it's also a time of failed resolutions: In general, industry experts estimate that January creates a churn rate of about 24%, "so for every four members that join a gym, one is likely to drop out," Meredith Poppler, VP/industry growth for the International Health, Racquet & Sportsclub Association, told Marketing Daily.

Despite the weaker economy, "health club membership has held steady in recent years. A total of 45.3 million Americans over the age of six belonged to a health club in 2009, representing 16.1% of the U.S. population," she said. "That being said, we do project that club membership numbers will rise slightly given the strengthening economy."

(Source: Marketing Daily, 01/03/11)

Monday, January 3, 2011

Supermarkets Made Radio's Registers Ring in 2010

The radio industry has long been the medium that reaches consumers closest to purchase. In today's fast-paced world, it's become a big advantage to reach supermarket's key female customer. Radio has become the go-to place for grocery stores, spending more on radio advertising than television stations or newspapers.

Radio supermarket advertising was up 24% to $139 million in the first half of 2010 according to Kantar Media. When convenience and liquor stores are added to the mix, RAB data shows the broader category has grown 16% to $686 million through September.

Radio's biggest supermarket customer is Safeway, which spent $146.3 million on radio through September according to RAB. That's up 32% compared to last year. The rapidly-expanding Aldi chain is a prime example. "As we continue to grow and emerge in new markets we will continue to use a combination of radio, TV and print advertising," Aldi spokeswoman Katherine Davis says.

"Traditionally Aldi has limited our marketing efforts which have allowed us to keep advertising costs down and prices low."

Aldi spent $6.3 million on radio during the third quarter, up from just $250,000 during the same period one year ago. So far this year, it's spent $19.1 million on radio. That's a big increase for a chain that bought its first TV commercial just two years ago.

The supermarket sector is a low-margin business, with a fine line between making and losing money. As a result, most chains won't talk about their marketing -- or use of radio. But Food Lion went public with news of its marketing plans earlier this year, announcing it would take to radio, print, online and outdoor to promote "new, lower prices" across the 11 Southeast and Mid-Atlantic states it operates. VP of marketing Ken Mills says they believe the ads will "set us apart from other grocery retailers."

(Source: Inside Radio, 12/13/10)