Starbucks Launches Instant Coffee.

Having worked with Nestle on its Nescafe brand throughout the world I found this very interesting. I always believed Nestle should have created a Starbucks style cafe and add credibility to its coffee heritage for instant coffees. Now Starbucks has done it.
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Starbucks launches its first major advertising and marketing campaign Tuesday for Via, the instant-coffee product it spent 20 years developing. The marketer is tapping traditional and social media, and asking consumers if they can tell the difference between the instant variety and the brewed coffee that made it a household name.

The chain is expecting between 8 million and 10 million consumers to visit its 7,500 company-run cafes in the U.S. and Canada to participate in a taste test that runs Friday through Monday. Participants will receive a “thank you” card good for a free coffee on their next visit, and $1 off their purchase of Via at any Starbucks.

Part of the idea for the taste test, said Terry Davenport, Starbucks senior VP-marketing, came from the Chicago market, where Starbucks did its only advertised test of Via. While the TV ads led to a high level of awareness, consumers weren’t motivated to visit stores — so the brand created an event in hopes of spurring its faithful into action.

“Instead of selling something at them, we ask them to participate with us,” he said. In so doing, “we’re using the best weapon in our tool kit, one that on one else has, our store-level partners.” Starbucks is sending its 4 million Facebook friends invitations to participate, with the anticipation that they will invite their friends. “It has a multiplier effect,” Mr. Davenport said.

“I’ve been fooling people for almost a year now, at home, at the office. I make coffee for my wife almost every day,” Starbucks CEO Howard Schultz said in a call with reporters. “I tell people this is the instant version of Starbucks brewed coffee and they’re shocked.”
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With this launch, Starbucks is expanding distribution of Via from test markets Chicago, Seattle and London to stores throughout the U.S. and Canada. In addition to its own cafes, Starbucks Via will now be sold in REI, Office Depot, Compass, United Airlines, Barnes & Noble cafes, and Marriott and Omni Hotels. Via will break in to mass grocery in 2010.

Mr. Schultz said that the chain is looking to create “additional usage occasions” for Starbucks coffee. The idea is that heavy coffee drinkers may have a cup of Starbucks on the way to work and a mug of swill once they get there.

Starbucks sees additional opportunities with travelers and campers. Mr. Schultz initially defined instant coffee as a $17 billion market, but has expanded that estimation to $21 billion, based on updated international sales figures. Instant coffee is much more popular outside the U.S., making up about 40% of worldwide consumption.

While such a retail strategy seems unorthodox, it has worked for companies such as Red Box video, which rents DVDs outside supermarkets. Cranium, the popular board-game, grew its business by scoring distribution at Starbucks stores. Red Bull catapulted to prominence in part by its popularity as a mixer with vodka.

“All of those outlets make total sense,” said Lynn Dornblaser, director-consumer-package-goods insight at Mintel International. “But that’s not what a major market position should be, because it’s only going to be a tiny, tiny percentage of consumers.”

Starbucks acknowledged that another reason for holding off on mass grocery is ensuring that Via will be merchandised with other Starbucks products, and away from Nescafe. The Nestle product has mounted offensives in Seattle and Chicago, describing Via as a product that costs 400% more, or about $1 a packet.

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Wilderness Society Atlanta Gala

I attended the Gala Dinner for the Atlanta Chapter of the Wilderness Society last night…will write more about their goals and plans for the coming year soon.
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Mobile Marketing is a must for movie studios.

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Mobile has become a go-to channel for film and television studios looking to build buzz for a new movie or show.

To promote Frank Miller’s film “The Spirit,” Lionsgate launched an iPhone application letting consumers project themselves photo-realistically into the digital realm.

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“Mobile is always part of 360-degree marketing strategy for any new-release film that comes out, and increasing for new TV shows as well,” said Curt Marvis, president of digital media at Lionsgate, Santa Monica, CA.

“Our mobile strategy involves providing new, original content based on existing brands such as ‘Mad Men’ or ‘Weeds’ and figure out how to extend that through mobile channels,” he said. “We introduce new content via Web or via mobile or both, which encourages consumers to come back to traditional programming such as a theater or their TV.

“Mobile video is still in the early days, but we see a lot of potential.”

In addition to iPhone applications, Lionsgate has run SMS initiatives, mobile advertising campaigns, mobile sweepstakes, free mobile content and mobile video.

The studio is also working on releasing several gaming-based applications for the iPhone.

Overseas, Lionsgate has launched shows that were financed exclusively through revenues generated from mobile, and Mr. Marvis believes that in two-to-three years the mobile commerce ecosystem may be mature enough in the U.S. to generate massive mobile content sales.

“Definitely we’re huge believers in the mobile channel as a video channel, and the bandwidth will have a lot to do with that, but the concerns about the small screen-size are bullshit,” Mr. Marvis said.

As evidence he cited the “incredible” number of TV episodes consumers have bought via iTunes to watch on their iPhone.

Mr. Marvis also believes that mobile payments using one’s handset will be a game changer. He was excited about ARL/VRL audio-based location technology that integrates voice recognition and mobile coupons.

“You’ll be able to say a brand name or movie title, find where the closest retailer is or the closest theatres that are showing that movie, also giving you a $1 off coupon,” Mr. Marvis said. “There are some of the things we see going forward becoming really valuable for us.”

Also, better devices and better networks will mean more opportunities for brands to reach consumers via mobile and provide better content and a better experience.

“Once bandwidth starts to expand, five years from now the mobile channel will be a massively important contributor to our revenue,” Mr. Marvis said. “It will probably revolve around the forward-going notion among consumers that everything’s free, and the entire entertainment business is faced with different models to cope with that.

“There will be subscription services such as TV anywhere, where cable is also available on subscribers’ cell phone wherever they are, and it will be much more ad driven than it will be transactionally driven—brought to you by brand X, Y and Z,” he said.

Does Mobile Marketing Infringe on Our Privacy?

Naturally, privacy watchdogs answer the question in this post title with a resounding “Yes!” The answer is so emphatic, in fact, that the Center for Digital Democracy and U.S. Public Interest Research Group are filing a complaint with the FTC alleging that mobile marketers collect so much “non personally identifiable information” that it infringes on users’ privacy—and are “unfair and deceptive.”
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Mobile devices, which know our location and other intimate details of our lives, are being turned into portable behavioral tracking and targeting tools that consumers unwittingly take with them wherever they go.

(Shh! Don’t tell them the FBI can remotely turn on the microphone of several cell phone brands and convert your phone into a roving “bug” even when it’s off!)
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But is the Internet really private? Should it be?

Is a profile that states that you are interested in outdoor recreation and currently in the Santa Clara, CA, area an invasion of your privacy? And if so, should we ban all outdoor rec stores and centers in Santa Clara from collecting personally identifiable information like, say, a picture of you when you walk in their lobby?

Should we prohibit all employees from asking your name and if you slip and mention it, make sure they never call you by it?

Naturally, there’s a limit to how much information a mobile phone can give marketers (without some sort of lead generation input or opt-in).

As with PC-based behavioral targeting, mobile marketing companies do not typically collect names, phone numbers, email addresses or other so-called personally identifiable information.

But advocates say the information gathered is so detailed that it poses a threat to privacy.

“They don’t need to know a name to know that Mobile User ‘X’ likes to search for fast food, bought a new car recently, and went on the mobile phone looking for a lower-interest credit card,” said Jeff Chester, executive director of the Center for Digital Democracy.

The complaint says that they want the FTC to look into behavioral and geographic targeting in mobile marketing, and require mobile marketers to use opt-ins and to disclose to users how their information is going to be used.
Presently, text-message (SMS) marketing is opt-in, but other forms of mobile marketing, such as search and display, aren’t.

Ultimately, however, it seems that privacy advocates are hoping for a world where we can be “safely anonymous” online, whether we access the Internet from our computers or our phones. But remember, in this world, advertising is no more targeted or helpful than it is on, say, television.

What do you think—is mobile behavioral and geo-targeting an invasion of your privacy?

With Zero Ad Budget Pabst is “Ironic Downscale Chic”

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Pabst Blue Ribbon is a recession juggernaut, but not just because it’s cheap.

Sales of PBR are up an astounding 25% this year, according to Information Resources Inc. And while cheaper beers — a group within which PBR has long been something of a mascot — are outperforming their more expensive peers as consumers look for low-cost options these days, there’s clearly more than pricing at work here.

So, what’s driving consumers to choose PBR?

For starters, PBR isn’t that cheap any more. The brand hiked prices this year, and a case of PBR now costs $1.50 more than MillerCoors’ Keystone, $1 more than Anheuser-Busch’s Busch and Natural brands, and 50 cents more than Miller High Life.

And it’s growing at a faster clip than all of the aforementioned brands — all of which are growing this year — despite the higher price.

So what’s driving consumers to choose PBR? It’s not media spending, that’s for sure. According to TNS Media Intelligence, PBR didn’t register any measured media spending during the first half of 2009.

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That’s a clear contrast from other cheaper brews, which increased spending during the period vs. the year earlier in order to get front of mind with drinkers seeking cheaper options. Natural Light, for instance, spent $1.4 million on measured media in the first half, up from only $350,000 a year earlier. And Miller High Life spent about $4.7 million during the first half of 2009, compared to $4.5 million a year earlier.

All of those brands are substantially bigger than PBR, which accounts for about 0.7% of the U.S. beer business, vs. Keystone Light’s 1.8% share, High Life’s 2.3% share, Natural Light’s 4.2% and Busch and Busch Light’s combined nearly 6%.

But still, if PBR costs more and advertises less, why is it up 25% this year, vs. an 18% gain for Keystone and low- to mid-single-digit gains for the others?

The answer, wholesalers and beer-marketing experts said, is likely found in marketing activity that occurred long before the current recession.

Back in 2004, Pabst executed a highly effective word-of-mouth campaign that made the long-declining brand an “ironic downscale chic” choice for bike messengers and other younger drinkers who viewed the beer as a statement of non-mainstream taste. PBR sales surged by nearly 17% that year, and have climbed at single-digit rates since, until this year, when the recession sent its sales soaring as more drinkers were pushed into the sub-premium category.
Think of it as conspicuous downscale consumption, or something like it.

“There’s still a bit of hipness to it,” said Benj Steinman, editor of Beer Marketer’s Insights. “Of all the sub-premiums, it’s got a little more cache.”

“It’s an anti-establishment badge,” added a major market wholesaler. “It seems to play to the retro, nonconformist crowd pretty well.”
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