Smart marketing can give a product new legs
All products pass through a life cycle -- from introduction and growth to maturity and decline. The job of a marketing manager is to insure that once the product hits maturity, represented by a peak in sales, it stays there as long as possible. While decline is inevitable, maturity and its associated profits are preferable.
How do marketing managers help products become age-defying, so they remain in the maturity stage of the product life cycle for decades or longer? Part of it depends on continually re-inventing the product concept.
Here are some examples to give you food for thought.
Crayola Crayons
Binney & Smith has been making Crayola Crayons for more than a century. Crayola has become a household name with products sold in more than 60 countries around the world.
The company has worked hard to keep the crayon concept fresh by adding a steady stream of new colours, shapes, sizes and packages. It has also extended the Crayola brand name to markers, watercolour paints, themed stamps, stickers and stencils, and even licensed the brand for use on lunch boxes and children’s clothing.
A magazine called Crayola Kids was launched as well as a web site with features for kids and advice to parents on topics such as reading skills and creativity.
Kraft Dinner
Another product that has been finding its way into Canadian homes for years is Kraft Dinner.
More than 246,000 boxes are consumed every day, making it the number one selling grocery item. Launched in 1937, it holds a phenomenal 75 per cent share of the market.
While it doesn’t hurt that rock group the Barenaked Ladies sang about Kraft Dinner in a song, Kraft still has to work to keep the product growing.
Canadians eat three times more Kraft Dinner than their American counterparts, which presents a tough challenge. Just how do you get them to eat even more?
One way is to ensure the brand stays relevant to consumers. Kraft conducted research to understand why Canadians loved Kraft Dinner so much and to help it reconnect with adults. The research revealed that everyone had their own special truths or moments associated with the product. These insights were used in advertising campaigns.
The company also gave the well-known blue and yellow box a new look with 3-D lettering. And new variations were introduced including Easy Mac Macaroni & Cheese, a microwaveable, snack-sized product to appeal to younger target markets.
In the world of toys, coming up with a product that will last longer than a Christmas season or two can be daunting. Mattel has defied the odds with its legendary Hot Wheels cars and Barbie dolls.
Hot Wheels
Hot Wheels were launched in 1968. Today, two cars are sold every second, three tracks every minute and 200 playsets every hour.
In fact, Mattel has sold more Hot Wheels than all big three automakers in Detroit have sold cars. They are consistently the top-selling toy by unit volume with an estimated 250 million sold worldwide annually.
So how do they do it? Part of the appeal is nostalgia, with parents buying Hot Wheels for their children.
But Mattel has also worked hard to ensure sales thrive. The company has signed many licensing deals with companies like DaimlerChrysler, which used a Hot Wheel doing a loop-the-loop in an ad and launched a special Hot Wheels Edition PT Cruiser.
Other initiatives included deals to produce branded apparel for adults and children. Mattel expanded its distribution through U.S. automotive parts retailers like Pep Boys and AutoZone Inc., which sell Hot Wheels branded floor mats, chrome wheels and other accessories.
Since exposure to new young audiences is equally important, Mattel worked with McDonald's Restaurants to have Hot Wheels featured as toys in Happy Meals.
Barbie
Barbie was launched in 1959 and became an instant hit. Today, sales of the dolls and merchandise total more than $1.5 billion U.S. annually, making Barbie the most successful branded toy in history. More than a billion dolls have been sold since 1959, with 2.5 dolls sold every second.
As a cash cow - Barbie provides roughly 40 per cent of Mattel’s annual profits - the company needs to keep her in the maturity stage of the product life cycle. It has achieved this by ensuring the doll is both timeless and trendy.
Different versions of the doll have been introduced to reflect the world’s diverse population. For example, Mattel has produced African-American Barbie dolls since 1968, the time of the civil rights movement, and has introduced Hispanic and Asian dolls as well. Themed dolls were introduced that changed with the times -- from stewardess, fashion model, nurse, and astronaut.
When Hilary Clinton was elected to the U.S. Senate, Mattel came out with Senator Barbie. When Barbie turned 40 in 1999, she got a tattoo of a butterfly just above her navel.
Sales of clothing have made Mattel one of the largest clothing manufacturers in the world, simply by producing outfits for Barbie. A clothing line for girls is also available, as well as Barbie cosmetics and bath lines.
Licensing deals were signed with organizations like Avon, Polaroid and REM Eyewear who use Barbie’s image on vitamins, cameras and film, and eyeglass frames for girls aged four to nine, all helping to keep Barbie trendy and top of mind.