Good Honest Dollar $$

(Image provided by Sally Mahoney via Wikipedia)

Time will tell whether or not Pepsi’s move not to advertise at all during this year’s Super Bowl will pay off – after being the single biggest advertiser in last year’s event.

But what is for sure is that the company’s latest marketing push – under which grants are provided to support a range of community projects chosen by a public voting system – represents an ingenious idea for which the company is to be applauded.

 
The Strategy:
As a result of changes in marketing strategy, Pepsi decided not to advertise at all during the Super Bowl this year.

Instead, under the Pepsi Refresh Project,  an amount roughly equivalent to the $20 million which it shelled out on the event last year is being allocated toward grants to a range of charities and community organisations.

What is unique about the project is that Pepsi will not decide itself which projects are to receive the funding. That decision will be made by members of the public via an online voting system.

The system works as follows:

(1) Individual members of the public are invited to submit their ideas for worthwhile community projects

(2) Members of the public vote on their favorite ideas

(3) The company provides grant funding of between $5,000 and $25,000 for the most popular projects.

 
Why the strategy is so good
This type of system has three key benefits over and above straightforward corporate donations:

 
• Backing causes which really matter to consumers.

The best thing about Pepsi’s new approach is how it allows consumers themselves to dictate where the money is spent.

Consumers themselves are best positioned to understand what causes they are passionate about. Putting decisions about allocation of cause related funding in their hands ensures that projects supported under the program are relevant to Pepsi’s target market.

 
• Generating consumer involvement.

Judging by the attention Pepsi’s new campaign has generated online, it appears to be doing well in one of the most challenging aspects of cause related marketing – getting consumers to sit up and take notice.

Why? One reason is that Pepsi’s approach is genuinely unique and therefore stands out from the crowd. But more importantly, through the submission and voting process, the project is generating involvement on the part of the general public, giving them a real reason to pay attention.

 
• Reinvigorating the brand.

There is little doubt about the relationship between a company’s marketing strategy and consumer perceptions of its brands.

Innovative marketing campaigns promote a positive brand image. Vice versa for campaigns which are dull, boring and ‘same as everybody else.’

By trying something new and innovative, Pepsi is positioning itself on the cutting edge – exactly where the company wants to be given the importance of the youth market and the associated need for the brand to be seen as hip, cool and ‘out there.’

 
Over to You
What projects would you like to see Pepsi support in your community?

Do you think companies are generally good at understanding what causes are important to consumers?

Is corporate sponsorship of community projects is more/less powerful than advertising at major sporting events like the Super Bowl?

“Good evening, Mrs. Smith.

My name is Tom and I’m calling from XXX corporation.

Our company realizes and realizes that your household is in fact on a national database commonly known as the Do Not Call register, and that you have indeed indicated that you do not wish to be contacted by companies such as ours at your private residence on a cold call basis.

Furthermore, we therefore realize that our act of contacting you is therefore, illegal.

Nevertheless, our organization is extremely confident that our products and services represent great value to all of our customers, and that you and your family will be truly excited about our offering.

Accordingly, our organization has decided that it would be appropriate for us to show no respect whatsoever for you or your stated desire not to receive sales calls at your private residence, and to contact you about our great offering anyway.

So, if I may, let me just take a few minutes of your time to tell you about our exciting new promotion …”

 
‘Do not call’ registers
No company would seriously have call centre telemarketers contact people with the above spiel. Yet from my viewpoint, that is exactly how cold calls from telemarketers sound when they contact private residences which are on the ‘Do Not Call’ register.

I don’t know what the situation is like in other countries, but in Australia, the national government has operated a ‘do not call’ register for the past three years. Under this concept, those who do not wish to receive unsolicited sales calls at their private residence can opt to place their number on the register, and companies are thereafter forbidden from calling them for promotional purposes (charities are exempt).

However, it seems that compliance represents an ongoing problem, and one bank in particular was reprimanded this week by the national regulator for its consistent failure to comply with the requirements of the register.

 
Poor ethics and poor business
The ethical issues associated with ‘do not call’ registers are clear cut – companies have a very clear ethical obligation to avoid making unsolicited sales calls to those who are on the register. The practice of making such calls is not only illegal but represents a flagrant disregard for the explicitly stated request of call recipients.

If issues of courtesy and etiquette were not sufficient to persuade companies to comply with ‘do not call’ regulations, then business case considerations should be, particularly given the prospect of legal penalties and the adverse impact of non-compliance upon corporate reputation. Not to mention the prospect of lawsuits from disgruntled call recipients.

 
The brighter side – how the registers help companies
But, for companies there is a more positive side to the story in terms of lifting outbound call centre productivity and reducing staff turnover.

All other things being equal, prospective call recipients who are listed on the register are less likely to be responsive to cold calls than those who are not.  

As a result, these types of registers help companies to filter out less promising call recipients, thereby lifting the productivity of their outbound call centers in terms of revenue generation.

In addition, to the extent ‘do not call’ registers help to filter out the type of call recipients who are likely to adopt an abusive attitude toward their staff, these registers assist organizations in terms of staff retention.

(On the other hand, where organizations ignore the requirements of these registers, I can hardly imagine affected call recipients representing any kind of promising sales lead, nor could I imagine that encounters with such recipients aid in call centre staff retention efforts)

In short, use of ‘do not call’ lists provides a great opportunity to raise outbound call centre productivity and staff morale – an opportunity companies would be crazy to miss.

 
Over to you
Do they operate ‘do not call’ registers in your country? Have they been effective in the elimination of unsolicited sales calls?

(Image provided by U.S. Department of State)

‘Lancia supports Aung San Suu Kyi – free now’

Last week, I talked about the ethical issues associated with the bold statement which Italian Automaker Fiat is making in its latest advertising campaign for its Lancia model in Europe, a campaign in which the automaker makes a public call for the freedom of political prisoner Aung San Suu Kyi in Myanmar.

(Click here to view the ad)

Today, I would like to talk about why I feel that the advertisement is effective from a marketing viewpoint in spite of the risks involved for companies in making stands on political issues.

 
Why political statements are risky
Reluctance on behalf of corporations to use political advocacy as a form of branding strategy is more than understandable.

Indeed, this type of strategy, where companies attempt to align their brands with a specific political cause, can be fraught with danger, and brands can suffer a substantial degree of damage in the event that the strategy backfires.

Potential risks include:

• Becoming embroiled in political controversy, potentially alienating not only consumers but also influential government officials, bureaucrats and senior public servants;

• Alienation of consumers even in the absence of political controversy, particularly those who feel that big business has too much political power and influence, or who simply feel that business should stay out of politics;

• The potential for consumer focus to be distracted away from the key features or benefits offered by the brand at a more practical level.

 
Why this ad is so good
Despite these risks, I feel that Fiat’s advertisement represents a stroke of mastery, and that the way in which it has executed its strategy almost reflects a sense of the Midas touch.

What I like most about the campaign is that it appears to achieve the full benefits of what firms would normally expect to derive from traditional advertising and it appears to create a positive connection with an important political cause at the same time.

More specifically, the campaign has at least six key attributes which I feel will are likely to contribute in a positive way towards the achievement of successful outcomes:

 
(1) Attention grabbing.

In today’s environment of advertising clutter, the company’s strong statement stands out amongst the crowd.

Irrespective of how they feel about it, many European viewers are no doubt finding themselves compelled to sit up and take notice.

 
(2) A strong emotional connection

Related to the above point, given the extent of global concern about the plight of Miss Suu Kyi, I am certain that many of Fiat’s target customers would feel strongly about her cause, and I am confident that the advertisement will help to create a very strong emotional connection with the brand.

Personally, I find myself almost moved to tears when the car door opens to the empty seat – the seat in which Miss Suu Kyi would have been but for her unjustly detention.

 
(3) Politically safe.

One way in which brands which pursue political advocacy as a branding strategy can avoid becoming embroiled in controversy is through careful selection of the causes which they choose to pursue.

Here Fiat has chosen wisely, and would appear to be on very safe ground. Support for Miss Suu Kyi is virtually unanimous all around the western world, and it would be difficult to imagine calls for her freedom generating any form of unforeseen controversy.

 
(4) Cost.

Due to its ‘community announcement’ nature, some networks are reported to have agreed to screen Fiat’s advertisement free of charge.

As a result, not only does the company’s campaign compare favorably from a cost perspective with other forms of cause related marketing, such as sponsorships of charitable foundations or participation in community business partnerships, it has also proven to be less costly than traditional forms of advertising, which would not attract such a concession from the networks.

 
(5) Proactive risk management.

I feel that the approach of the company toward the management of risks associated with the campaign was exemplary.

In particular, its actions in gaining support from Kyi supporters of Miss Suu Kyi, as well as the approval of each of the other individuals featured in the advertisement went a long way in terms of heading off any potential suggestions of using a political injustice for corporate gain.

(The company was not able to obtain permission from Miss Suu Kyi herself due to visitor restrictions as a result of her detention)

These actions represented a proactive approach from the company in terms of the identification of potential risks associated with the campaign and the undertaking of pre-emptive action in order to mitigate any possible effect of such risks.

 
(6) A statement of prestige and class.

Best of all, the advertisement still managed to create a strong brand association in terms of comfort, style and class.

The result - a strong brand association with the cause and a strong brand association with the features of the vehicle.

The advertisement shows three noble peace prize winners along with a former hostage arriving in Lancia’s and being greeted by Michail Gorbachev, arriving at the Ninth Summit of Noble Peace Prize Laureates.

Yes, this is a political statement, but it’s also a branding statement, and there are few better statements of prestige and class than having people of that caliber arriving in Lancia’s, one after the other.

(Image provided by Squeaky Marriot)

Khao San Road, Bankok.

“Hello, sir. How are you?” he greets me with a smile.

How nice. I’m a stranger in a foreign country, and someone cares enough to say hello.

My response, given without breaking stride, is followed up by questions about my nationality and the duration of my intended visit to his country.

But he goes for broke upon the realization that my walking speed has accelerated and that I am getting away.

“Sir, sir – new suit for you.”

Now we get to the point.

My new best friend, a street trader in a shopping strip frequented by foreigners, does truly care about me, and is genuinely glad to see me in his country.

But his interest is not primarily related to me as a person. Rather, his predominate focus is centered around the soft leather case in my pocket, along with my ignorance with respect to fair market prices for his offering.

“I’m right thanks.” I smile back. I have a good three meters on him now, and have successfully evaded yet another sales pitch.

“Sir, custom make. I give discount. Special price only for you…” his voice fades in the distance.

His comment about a ‘special price’ was right on the money. He does want to charge me a special high price.

 
(Image provided by Merkur)

Street vendors and business ethics
Similar scenarios can be found throughout the world in many street markets or shopping strips which are frequented by expatriates or western tourists. An army of street traders enthusiastically welcome foreign visitors, hoping to flog anything from tailor made suits, to gimmicky souvenirs, and anything in between, often at grossly inflated prices.

Generally, I think of them as part of the parcel when it comes to visiting shopping strips or malls as either a tourist or expatriate, and I feel that they add a sense of vibrancy to the foreigners’ shopping experience.

Nevertheless, not all visitors appreciate them, and their activities do raise ethical questions with regard to at least three areas:

• annoyance to patrons with intrusive or over-persistent sales efforts;
• charging over-exorbitant prices, based upon the ignorance of their foreign clientele;
• truthfulness about claims with respect to their merchandise.

Each of these issues will be discussed in turn.

 
Courtesy and Respect
With regard to the first point, street traders are business people, and as such have a right to promote their merchandise. This includes doing whatever is necessary, within reasonable limitations, in order to attract the attention of potential customers (victims).

That said, patrons must not be subject to undue harassment or interference, and traders should at all times demonstrate a degree of common courtesy in their approach.

In this regard, I feel that vendors should refrain from:

• any form of interference with respect to the physical movement of patrons, such as placing themselves in the direct path of oncoming patrons;

• approaching seated patrons during the course of meals or drinks;

• approaching patrons whose body language clearly indicates either hurriedness, or that they are looking for someone; and

• persisting with the sales effort after the patron(s) concerned have given a clear rejection of the offer.

With a little courtesy and respect, traders can attract attention without causing undue inconvenience to patrons.

 
Overcharging based on Ignorance
In relation to the second complaint, I do not feel that attempts to pray on the ignorance of foreign patrons by charging exorbitant prices necessarily represent a breach of ethical practices.

Business is a tough sport, and I see no reason why street vendors should charge anything less than what they think their clientele will pay.

Foreign patrons should anticipate such practices, and as consumers, it is their responsibility to educate themselves with respect to fair market prices, something which can easily be done via shopping catalogues, the internet, visits to department stores, or simply shopping around for the best price.

 
Truthfulness in marketing claims
As with other forms of business, street traders have every right to present their merchandise in a positive light, and need not attempt to provide an impartial view with respect to the suitability of their product for the patron concerned.

That said, they should avoid any form of purposeful misrepresentation or untruthfulness, for example by representing merchandise as genuine brand name products when it is counterfeit or fake.

The presentation of one’s offering in a positive light represents an acceptable business practice. Untruthfulness or product misrepresentations do not.

 
Summary
Street vendors should exercise courtesy and respect at all times.

Provided they do this, they are part of the culture and fun of street markets.

(Image provided by U.S. Department of State)

“Lancia supports Aung San Suu Kyi. Free now!”

There are, in my view, two key questions with respect to the efficacy of Fiat’s bold political statement in the Italian automaker’s most recent campaign to promote its Lancia Delta range in Europe:

• whether or not the advertisement crosses ethical boundaries; and
• whether or not it represents a wise marketing strategy.

The first issue is discussed below, the second will be dealt with in a later post.

Broadly speaking, I feel that the advertisement represents a smart and creative method of branding. Not only does it fall well within acceptable ethical boundaries, from my viewpoint, it represents a constructive contribution toward a very, very important cause.

 
About the advertisement
The advertisement, which is now being screened across Europe (the company has no plans to screen it in the U.S), aims to tap into public sentiment with respect to the ongoing house detention of Aung San Suu Kyi – winner of the 1997 Nobel Peace Prize whose National League for Democracy won the right to govern her country in 1990 but was denied that right by a brutal military regime which refused to cede power.

(Click here to watch)

Shot in Paris last month at the Ninth World Summit of Nobel Prize Laureates, the advertisement shows three Nobel Peace Prize winners (Lech Walesa, Frederik Willem De Clerk and Betty Williams), as well as former hostage Ingrid Betancourtarriving at the summit in Lancia Deltas.

“There are people who have been fighting forever,” a voice-over says. “We would hug them all for a day. But there is one hug we miss.”

A forth Lancia pulls up, with a door opening to an empty seat, symbolizing the space where Aung San Suu Kyi should have been.

A photo of her follows, together with the statement “Lancia supports Aung San Suu Kyi. Free now.”

 
Possible causes for complaint
The advertisement is not popular with everyone. Possible reasons why some may potentially object to this form of advertising may include a feeling that the advertisement: (a) represents an attempt to exploit a downright awful political situation for commercial advantage; (b) does not represented a real  to the cause, particularly in light of statements that the firm has no intention of making any direct financial contribution to Miss Suu Kyi or her supporters; and (c) does not serve a useful purpose – the repressive military regime are hardly likely to free Miss Suu Kyi because of an advertisement.

In addition, given the argument raised in point c, some may feel that the advertisement does not represent a constructive allocation of CSR funding, and that the money spent in making it could have been better spent on other initiatives which have a more direct social impact.

 
In defense of the company
I do not agree with the above objections, and furthermore, I feel that the advertisement represents a constructive initiative on several grounds:

 
• The company made valiant attempts to do the right thing by all parties concerned.

Fiat was not able to obtain permission from Ms. Suu Kyi herself due to visitor related restrictions to which she is subject.

Nevertheless, along with gaining the full permission of others who were featured in the advertisement, the company did receive positive responses from her key supporters, and so had every reason to believe that its campaign had the blessing of those at the forefront of her struggle.

 
• It’s a very positive message.

It is difficult to object to the content of this message.

Of course Miss Suu Kyi should be freed. She should never have been forced into exile or placed under house arrest in the first place.

Her continued political imprisonment represents an ongoing subversion of natural justice as well as a repression of the will of the Burmese people, and Fiat’s call for her freedom is more than justified.

 
• We should continue to speak out.

The point must be conceded that the Burmese military has never paid much attention to worldwide opinion of its oppressive practices, and is most unlikely to be moved by Fiat’s advertisement.

But that is no reason not to speak out. As a global community, under no circumstances should we ever cease to protest about the plight of Miss Suu Kyi or that of the repressed Burmese people, and the company’s announcement represents a constructive contribution in this regard.

Injustice should never occur in silence.

 
• Political advocacy is a legitimate aspect of Corporate Social Responsibility (CSR).

Political advocacy is no substitute for other initiatives relating to CSR.

But, if undertaken sensibly, it does have its place, and I feel that Fiat has every right to view calls for Miss Suu Kyi’s freedom as a legitimate aspect of a broader contribution toward CSR initiatives.

 
• A sincere message.

No doubt Fiat’s motivation with respect to this initiative is underpinned by commercial considerations to some degree.

Nevertheless, I do not feel that the message is lacking in sincerity in any way, particularly given the likelihood that calls for Miss Suu Kyi’s freedom would have the full support of almost anyone who is associated with the company in any way.

 
Summary 
Along with it’s novel approach to branding, I feel that Fiat deserves commendation for it’s bold stance about this ongoing crying injustice.