Current Issues in Marketing Strategy

Coke's energy drink 'Mother' has been revitalized thanks to their 2008 product revamp. The 500ml can, new flavour and completely new marketing campaign has allowed them to break the shackles of Red Bull & V and potentially cement a place in the growing energy drink market. So what marketing strategy have they implemented and what have been the results?


Product composition was the main change, a new flavour, 1/2 litre can and text that pokes fun at how rubbish Mother #1 was, but the $3 million advertising campaign was the real driving force. When Coke pulled Mother #1, they were left with a brand awareness that most marketers dream of. A massive 84% of 16 - 29 year old's knew what mother was, but less than 50% that had tried it had made a repurchase. Negative brand equity can be an enormous problem, luckily Coke pulled the pin on product #1 early and the TVC's and print advertising has been distancing themselves from it as much as possible.

The result of the marketing strategy has been sensational (in contrast to 2007). 42% of the target market have trialed new Mother and of that number, 70% have purchased again. The overall result of which has seen them gain somewhere between 12 - 20% market share. Coke executives are estimating turn over will be $696 Million for 2008, up 13% from 2007. The figures do sound excessively high and I'm sure there will be plenty of fluctuation, but don't forget that Coke has enormous channel power in almost every drink vendor in the country!

Josh Strawczynski's Opinion:
I personally don't like the new mother, but from a marketing perspective, you have to hand it to them. Their 4th attempt in 6 years may have finally hit the nail on the head! I do feel that those market figures are a bit too fluffy to be true, but I know from simple observation that there are a lot of people buying them. It will be interesting to see how the market leaders respond to this threat, how do you compete with Coke?

Sam Berringer's Opinion:
I like the new taste, but 1/2 a litre is a bit excessive and the 2 for $5 deal is ridiculous...no one is going to purchase 1litre of energy drink. I think there are some bugs in their promotional side, but apart from that, they look to be on a winner. I will be watching how they roll out into bars and clubs with great interest.

When a brand like Powerade already own 51% of the market, it is very difficult to gain more market share. Distribution is excellent, brand awareness is very high and it has a solid reputation across many consumer channels, so throwing money aimlessly at TVC, radio & other campaigns will not yield a great return. Instead Powerade is extending their product lines by rolling out 'sugar-free Powerade', giving them more product facings and the ability to tap into the 'sugar conscious market'.


The marketing strategy is solid, production costs are relatively low as the infrastructure for making the new bottles is almost identical to the classic style. The advantage is that the market leader now has a larger portfolio of drinks that they can squeenze into their clients fridges. Red Bull have found great success with this strategy releasing Red Bull sugar free & the new large cans.

The strategy of portfolio expansion does have its downsides, as Sam pointed out to me, cannabailisation of the current product tends to see a reduction in indiviudal line sales, however an astute marketer will look at the portfolio on the whole and see that more refridgerator facings means better chance of making a sale and less room for competitor products.

The new formulation of sugar free is aimed at a growing section of the market, the ultra health conscious. Bottled water is the only real product targeting this market and with $460 million dollar worth of sales in Australia alone, it is a very attractive market to target. If Powerade could steal just 1% market share, they would make a tidy profit!

Josh Strawczynski's Opinion:
The advertising will need to really focus on the positioning of the product. To be truly effective, they need to steal marketing share from the bottled water market. Powerade already has a healthy brand image, so it is not likely to boost consumption too highly without doing so.

Sam Berringer's Opinion:
I don't really see the value in it all, the product is too similar to the original, which I understand is a market leader, but what has happened to most of the coke extensions, they are more niche players than successful stand along products!

Norton Anti-virus has gone back to the drawing board in an attempt to revitalize their brand. The release of Norton 360 (2008) v2.0 requires a marketing strategy that retains the brand name, but improves the image, which to be honest, has more flees than a dead camel. If Norton 2006 was a dog, it would have been put down immediately, because despite the hype and brand recognition, all it did was lie in the doorway, obstructing your access. So let's look at the marketing strategy behind the 360 degree face lift.


Positioning is the corner stone of the campaign with a range of print and online media featuring Craig Lowndes (V8 Supercar Champion). This part of the strategy is simple and in many ways effective. Even a well trained monkey could tell that they are aligning their brand with a fast and streamlined speed machine (and it's driver). Despite how simple this may seem, never lose sight of the fact that simple is effective.

Something the campaign has not done well is the placement of their print ads. The magazines have all been car related and all tied into Bathurst, (Auto Action, Top Gear, V8X, V8 Bathurst Magazine, Bathurst Official Program). Now once again, even George Bush understands the parallels between Craig Lowndes and Bathurst, but they are only targeting a very small portion of the total market and I would argue the wrong segment. I can't see the cross over between motor enthusiasts and anti-virus software other than the fact they will recognize the endorser (Lowndes).

The Norton Website is an interesting 'hands on' display that presents the user with a graphical dashboard displaying the difference between the 2006, 2007 & 2008 models in terms of processing time. The interface looks to me like it is faking the statistics and could be vastly improved by linking to fan reviews and other credible data.

Liam Tung from Znet wrote about Norton's history of "over promising & under delivering". At the end of the day, this is exactly the problem. Will the new product be any better? Well, it better be, or all the marketing in the world will not save them from the ditch of negative brand equity they have dug themselves.

Josh Strawczynski's Opinion:
The closest example I can think to Norton's current positioning is Volvo. Going back 2 decades, Volvo branded themselves as 'safety #1', an image that they carry to this day. Despite a wide brand awareness, the image of a safe vehicle does not sell cars. To this day, Volvo has invested millions in trying to shake the tag and yet it is still like the fat dog in the doorway...alive and well.

Sam Berringer's Opinion:
I would really like to see them open up the campaign to a wider audience. There is recognision for Craig Lowndes outside the racing world, just like non-golfers recognise Greg Norman. So play to this strength and target the home users and business operators...this is where the money is at!

Dunlop Volleys have come back into vogue lately and supporting them, a TVC that could only be described as 'radical'. The 5 ads feature foreign cultures like Azerbaijan playing instruments and communicating in their foreign language without translation. The camera gives glimpses of the volleys here and there, but you really need to think about it. It is a brilliant marketing strategy!


Everything about their offering is integrated, encouraging users to get involved with the brand. The campaign is hugely involving and as a flow on of this very effective. I have heard Gen Y's on the train talking about it a lot! But they even go one step further at their hilarious website, with background video's and information and they are running a competition to design a 30 second Australian Ad in the same vein as the last.

The positioning of the volleys brand is essential to their success. A flash website and classy TVC just wouldn't fit the brand they are promoting because Dunlop Volleys are just not classy. The reason Volley's are cool is because they are cheap and edgy, thus their marketing needs to reflect this. Many marketers will try to tell you that they are damaging their brand, these are the very same marketers that don't understand Gen Y, & the last time they were up to date with social media was when the term was a synonym for Communist Propaganda.

Social media marketing is about working with your target market, allowing them to tell you what the brand means and then working with them to provide a solution to their needs. The Volley's ads are edgy, their web offering is hilarious and engaging and their competition encourages people to think, talk and develop the Volley's brand.

Josh Strawczynski's Opinion
I have heard so many people talking about the ads and question who they are aimed at. Please let me assure you, they are aimed at Australians, they utilize what advertisers call 'completion theory' to challenge us. Our brains go into a frenzy trying to work out what the brand behind the ad is, why they are showing it in another language and what product is being promoted. When the 30 second clip is over, we have given it our full attention and want to know if we are right...this is a very clever call to action.

Sam Berringers Opinion
The ads have created a stir, people are talking about them, but what is brilliant is the integration of the entire campaign. What I hope they do now is release the competition entries so that we can view them on youtube or a specific page to compare and contrast. You could use their site as a forum for feedback and general banter. It would be a great way to continue connections between users and the brand!

Have you ever watched a world vision TVC and thought; "Wow! That was really in your face"? I have heard many people complain about them in the past, suggesting that they are unnecessarily pulling on the heart strings. The truth of the matter is that they have to be. How else do you get an apathetic nation to pay any attention when it is out of sight and out of mind? The marketing strategy addresses this straight up...shock and awe.

Traditional marketers will argue that bombarding your audience with negative images (like car crashes in TAC ads) builds up negative brand equity and can have far fetching ramification for your brand. World Vision however is different, there is no real 'want' or desire that consumers are filling, so TVC's create one. They employ a shock and awe tactic that forces us into feeling compassion and then package a product that can reduce our guilt. Is this morally corrupt?

I once heard a compelling argument that hypothesized that the Nazi's came to power only because the German people were apathetic, the public (on the whole) were not supporting the movement, but because it did not affect them, they did not act and nothing got done. Poverty works in much the same way, we need to 'push' people into feeling guilty, sorry, appalled...anything that spurns a reaction to act. In PPC advertising we call this a 'call to action', particularly effective if it does not require any personal sacrifice, hence the $1 per day contribution.

Josh Strawczynski's Opinion
World Vision do fantastic work, sure their core function is helping the needy, but their true skill is attracting, motivating, and managing those of us who are in a position to make a difference. Check out their site if you are interested in some of the great marketing initiatives they have implemented

Sam Berringer's Opinion
Articles like this make me wish I was more than Josh's shadow writer. There are so many wonderful initiatives that World Vision implements, I wish we could talk about them all. Never fear, I will be lobbying him for more articles... I suggest you comment now!

If distribution is really the key to success in the Australian home entertainment market, then Tivo is one step closer to achieving a win. Off the back of a dismal launch in which Harvey Norman was the only retailer to give them a shot, the American 'super-device' went back to the blackboard and redesigned their offer. Since returning to the market, Tivo has penned an important deal with JB Hi-FI which will stock their product over Christmas in 100 stores nationally. The acid test is now on, will their marketing strategy hold up?

The pricing strategy is taking advantage of their first mover advantage beginning with a price skimming $699 per unit. Is this sustainable in the future? The price certainly is not, so I would hope that their profit margins are enormous. Given that JB Hi-Fi have finally agreed to terms, I am assuming that Tivo offered them the proverbial golden goose of sales deals. This could complicate things when competition comes into the market, the price will need to fall to maintain competitive.

The branding is excellent and I think this will be the cornerstone of their campaign. You can't turn on American television shows without a Tivo reference, so brand awareness and brand recall are metrics they can leverage. However, contra to this, is a Tivo unit an aspirational product? I can't see why consumers would buy it when the better, cheaper competitors come into the market.

Josh Strawczynski's Opinion
Tivo will record some reasonable sales this year, but only because they are the first ones in the Australian market. As with any technology, the early adopters will make up the main component of their sales, but I can see the checkered flag appearing already. If Tivo want to expand their life cycle, their marketing mix will need to change.

Sam Berringer's Opinion
The price is way to high, it should be somewhere around $500, their advertising needs to start pumping now to build for Christmas and they need to expand their distribution points to Dick Smith and much much more.

Coffee is a convenience product, consumers can be segmented into 'lovers' and 'on the run' drinkers.  The market is owned by a few large players and many smaller nichers.  Coffee HQ is a great example of an attempt to tap into this convenience market by setting up around Melbourne CBD train stations.  So what is their strategy and could they do it better?