When managing a brand, two approaches can be taken; preservation, renewal, extension and growth of existing product ranges; or, the creation of new products and services to satisfy emerging customer groups, new circumstances and new market segments.
An example of the first approach is the brand management of Heinz Salad Cream in the UK. Heinz, famous for the 57 Varieties slogan, saw that sales of salad cream were falling as consumers moved to continental mayonnaise and salad dressings. rather than reformulating the product, Heinz announced, very publically, through the press, that they were going to cease production. The result was a huge uplift in sales as the public, driven by memories of summer salads during their childhood, bought the product in their droves. It was a clear example of managing the renewal of a brand through viral marketing.
Dyson vacuum cleaners are an example of the second approach. Dyson use product improvement and innovation to drive sales. This marketing through innovation approach is reflected in Dyson’s advertising where prominence is given to patents and technological improvements when compared to traditional bagged cleaners.
At the cutting edge of marketing through innovation is the Blue Ocean. This is where innovation and technological development is used to disrupt the existing market place. At its limits Blue Ocean marketing is creating a new product and then finding a market for it. The Post It note is a classic example of Blue Ocean marketing. It is said, possibly apocryphally, that the Post It note began life in the development laboratories of 3M. The development engineer was looking to develop a new form of sticky tape and accidently mixed the wrong type of adhesive. The result was an adhesive which could be applied to paper and removed without leaving a mark. Only later was it realised that this technology had a practical use as office stationery.
Another example of the blue ocean is Graphene. Graphene is a British scientific discovery. It is a form of carbon which is a one molecule thick sheet. It is light and highly conductive. The UK government has invested significant amounts of money in the process of commercialising graphene. Possible product solutions include bendable electronics and tiny computer processors. Graphene is a clear example of the development of a product and only after its creation are practical products developed to exploit its potential.
EasyJet is often quoted as an example of Blue Ocean marketing, where the development of an innovative business model disrupted the existing airline industry. Certainly, EasyJet was a startling success and totally redefined the short haul airline market however it wasn’t that revolutionary a model.
Sir Freddie Laker, with his Skytrain and the Icelandic carrier, Loftleioir, used a similar no-frills, cheap cost model. Laker in particular was driven out of business by a combination of hostile market conditions and some particularly unscrupulous cartel activity by the established European ‘flag’ airlines. Laker successfully sued his competition but only received a settlement which covered his losses. EasyJet was successful because legislation prevented the other airlines acting as an anti-competitive cartel and because the prevailing market conditions in the airline industry were of excess capacity at regional airports.
Blue ocean marketing is risky and it is still an unproven marketing theory. Yet many small businesses look to a blue ocean approach. The approach of have an idea, create a prototype, and then look for a potential market. For every blue ocean success, there are numerous failures.
Take Bic as an example. Bic’s big blue ocean success was disposable razors. Before Bic developed the disposable razor people bought packets of razor blades to fit into their existing handle. Bic’s disposable razor was a use and throw away item, handle and all.
Flushed with the success of the disposable razor, Bic tried to develop another blue ocean product, a no frills fragrance. This product failed utterly. People did not want a no frills fragrance, image, packaging and promotion was closely aligned to fragrance buyers self actualisation needs. Bi lately tried to sell as no frills mobile phone for the elderly. This had no functionality other than as a telephone. The elderly clearly didn’t want to be seen as old and Bic clearly didn’t see that older people were quite happy to use technology. The phone project also failed
Many current blue ocean marketing campaigns are based on value. However, if your approach is solely based on value marketing, you may have no ocean at all. Some of the most successful blue ocean campaigns, such as Dyson, are based on careful market segmentation and increasing experiential benefits which stimulate the consumer’s mind.
Most of all, if you are considering a blue ocean approach, careful planning is essential.