Sports Branding -- Questions for you manufacturers/retailers/resellers, etc

Triathlon Forum
22

the auto industry is unable to brand to the same level as other companies, much as is the bike industry for one reason.

THEY STILL HAVE TO PRODUCE A PRODUCT. their success relies solely on the product that they are manufacturing, because if they don’t, other companies can come in and produce a better product for cheaper.

with the exception of ferarri et al, the majority of car companies have to rely on producing results, as opposed to sex appeal. i would argue that the same applies for bike companies. since we are still in the ‘innovation’ stage of the industry (well…kind of), those companies who produce the most advanced/aero/lightest/etc bike will sell the most.

with that said, TREK via lance, and cervelo via slowtwitch, aren’t doing too bad of a job creating an image for their bikes, one that definitly helps to sell thier products…hence branding

for branding to work, they company needs to create a lifestyle that the consumers associate with…and spend exhuberant amounts of money on advertising, something that just isn’t available to most of the small(er) buisnesses in the bicycle industry.

23

Gerard, agree with your analysis of dealer vs factory advertising. As someone who works primarily in the automotive industry, the two factions are always at odds - dealers are always wanting to put “0 down, 0% financing, get a free barbeque” etc in their ads. The way the factory attempts to control it is through “co-op” dollars – dealers can apply to get around 50% of the cost of their ad (media and production) back from the manufacturer. Some manufacturers have very stringent co-op rules (logo must be so high, cannot be too cheesey, etc. – BMW’s very good at that), some let their dealers run wild (GM, for instance). Their dealers know they have the power, and would riot if GM tried to enforce serious co-cop rules.

Question: Do bike/wetsuit/running shoe, etc manufacturers practice co-op with their dealers? Is it a good idea? Would it make sense, rather than the manufacturer picking up the entire cost of an ad, to pay some of a dealers cost, presuming that dealer appropriately promotes the manufacturer?

Regarding branding itself, I don’t think the sole ultimate point of branding is to charge a premium – if that were the case, consumers wouldn’t be gung-ho on the product after the purchase. I think strong branding also allows the brand to develop “brand ambassadors” – consumers who will go out and promote the product. Not just a word-of-mouth thing, it’s stonger than that.

24

Interesting thought, Kevin, but I’ll respectfully disagree. If you’re interested in the shift in our society between “manufacturing based” to “image based”, pick up a book called “No Logo”. Fascinating read.

Anyways, the point is this: Many automotive manufacturers in the US are not manufacturers. Toyota, Mercedes, BMW, for example – their product is thrust open them by corporate head office. While they stongly voice their opinion to the engineers at Global Headquarters, their jobs are not at the manufacturing end of things. It’s entirely the marketing/sales end of things, in various forms (dealer development, training, repair, etc., etc. – all things that affect the consumer experience, and hence sales).

Image goes a LONG way in selling cars. Many very popular European brands (I won’t name names) are truly terrible cars. I’ve seen engineers show me, piece by piece, why the cars are crap. A $15,000 Korean car is better made. But people by the European car, pay a premium, and are happy to do it.

Why? Brand equity, baby.

You’re right about bike branding, though. I think a lot of manufacturers are focussed on production, and simply don’t have the resources to brand well. But things are going to change…and as bike manufacturers get bigger, and production moves overseas, their going to have more time and more resources to invest in this. Perhaps I’m just ahead of the curve. Or clueless.

Before I go to bed, let’s use Lance (a brand unto himself, but that’s a whole other story) as an example.

Weak Branding: One of Lance’s sponsors using Lance in their ads “Lance uses us, and he knows, so we must be great”. That’s not branding, I’d argue, that’s simply piggybacking.

Strong Branding: The Lance Nike ad from earlier this year (http://www.nike.com/wearyellow/seelanceride/main.html). Why? It’s evocative, it’s beautiful, and it truly conveys that sense of freedom we all want and feel when we ride. Damnit, you want to be in Lance in that ad. There’s an emotional connection between the right viewer and the ad. Does it make me consider Nike? I now put them on the consideration list – they’ve demonstrated that they “understand” me.

Granted, Nike’s got a way huge budget. And very, very smart people working there who do what I do (and do it very well, I must ad). But that insight can also be demonstrated on a much smaller scale.

Whew. I’m going to bed.

25

shit…

that happens to be the book that i’m writing this paper on for tomorrow…well, at least sections of it are.

methinks i need to go back and reread :stuck_out_tongue:

26

ok…thought about it, read the article again, an started writing the essay. what you’re saying about automotive companies makes perfect sense now.

how i’m going to incoroporate this thread into an essay due @ 4pm that the main focus is on NIKE…different story…but that’s just details :wink:

thanks for that lance ad though…not only did that demonstrate amazing branding, but it is also going to be used in my essay, N.Klein is adamant about Michael Jordan as the branded superstar, and i’d like to use lance as possibly the (one of the) next generation.

Also…if you’re bored this morning, and want to help out a poor science student who doesn’t fully grasp essay writing, i’ll post my essay on here for you to take a look. since you’ve read the book in question, and work in the industry, maybe you could point out any glaring errors.

just a thought :wink:

27

Granted, Nike’s got a way huge budget. And very, very smart people working there who do what I do (and do it very well, I must ad). But that insight can also be demonstrated on a much smaller scale.

Whew. I’m going to bed.

This is very true. A lot of people here are saying it takes a huge budget to do decent branding, but that is croc. A huge budget actually reduces the pressure on the branding people to create great branding.

Some of the world’s greatest brands were initially built with no budget at all. Virgin for example was built almost exclusively on free publicity. The second most popular golf apparel brand in Canada, behind Nike, is Dunninggolf. And they don’t spend anything on marketing, yet they put companies like Adidas to shame.

The reason most bike branding is mediocre is not because of a lack of money, it is the same reason most bike designs are mediocre: bike companies are filled with mediocre people.

28

Gerard,

I agree, it does not take huge amounts of money to create a great brand.

I know that it’s difficult to look at individual cases, but look at the Run TO campaign Nike ran in Toronto last year. Total cost ran into the Millions of dollars. It was award winning marketing( I know I was at the presentation of some of the agency awards). However, it did very little to shift Nike’s brand awareness and sales in the running market in - ironically, a category and market that Nike helped found and create almost 30 years ago! Now you can’t even give a Nike running shoe to a runner training for a marathon.

Fleck

29

“Magazine articles are expensive - especially for smaller companies”

Advertising IS expensive - articles/stories/editorials are “free”. When I worked in the business, I was amazed at the companies that did not take advantage of the opportunities that often presented themselves to get coverage in industry specific media. Phone calls and requests for product for testing, photographing and reviews would go completely unanswered.These requests where just blown off by many on the supply/manufacturing side. Again, this is “free” exposure, but it does not come without a great deal of work behind the scenes. I won’t give away all the secrets, but let’s put it this way, the companies that do well at this game treat each media person/outlet as a good retail customer. When you start to do that, you will be amazed at what you can get.

Fleck

30

ok…someone has to explain to me what’s so bad about nike’s running shoes? i’ve been running in the shox like crazy, and bought 3 more pairs to last me for the next few years…

i’m heavy, so i thought they worked?

31

Agreed Fleck, but was the objective of the campaign to move the needle on Nike’s running stuff, or to get people to run in the race? This wasn’t Nike sponsoring a run, it was Nike being an RD. If you measure it against that, the campaign was hugely successful – something like over 10,000 people showed up for the run.

32

I agree - the line get’s a little blurry.

However, if they(Nike) were a responsible RD looking long term, to help advance their brand and advance running, then you would think they would look longer than one year. It was a one time, extraordinarily expensive, extravaganza. Over the short term it was very effective. Kudos to Nike. That was a record number of participants for any running race in Toronto, let alone a first time event! Why didn’t they keep going? They got 10,000 - the Sun Run in Vancouver has 40,000+. Why not keep it going and shoot for something bigger, or am I missing something?

Fleck

33

Gerald,

I think you’re a bit off base with the comment that: “The reason most bike branding is mediocre is not because of a lack of money, it is the same reason most bike designs are mediocre: bike companies are filled with mediocre people.”

There are more exciting bike designs and inovations across many cycling brands now there there has ever been. I agree that not all companies are pushing the envelope and coming up with new technology, but if you look at the major North America based bike brands they have all come up with major inovations in the last 5 years. Yes some companies have had financial problems (i.e. Cannondale going bankrupt because of their motorcycle division, Schwinn going bankrupt for the exact reasons you list above). I think the developments at Specialized, Trek (including LeMond), Giant, Serrotta, even Cannondale are now making bikes that are lighter, stronger and faster then ever before. Look at what’s coming out of aftermarket - big companies are finally spending money on making quality aftermarket products that aren’t their original base (FSA with wheels, Zipp with cranks, etc…)

I think the issue with bike branding is that this industry has long been based on marketing to the actually bike industry customers (bike shops) and not marketing to the end user. Look at Interbike. The biggest trade show of the year - the most manufacturers - the most new products - press on every cycling and tri- website - yet the public is not allowed into the site even for ONE day to look at the products. It’s like the cycling industry says - we don’t care about the public - we want you to go to your local dealer to find out about the bikes - don’t ask us directly.

34

“Question: Do bike/wetsuit/running shoe, etc manufacturers practice co-op with their dealers? Is it a good idea? Would it make sense, rather than the manufacturer picking up the entire cost of an ad, to pay some of a dealers cost, presuming that dealer appropriately promotes the manufacturer?”

Coop advertising is common in the sporting goods business - at least the concept is. At the implementation end it can get a little messy and frustrating.

People on both sides of the retailer/manufacturer fence can get a little uncomfortable when the subject comes up. When I was selling advertising in the business, I often pushed very hard and worked very hard to get coop programs going, but very often all of this work was for naught. My attitude was the more dollars and reasources in the pool the better it was. Works conceptually. However, frequently things came up to scuttle the deal(s). To say more would be unfair and possibly inflammatory!

Fleck

35

“I think the issue with bike branding is that this industry has long been based on marketing to the actually bike industry customers (bike shops) and not marketing to the end user. Look at Interbike. The biggest trade show of the year - the most manufacturers - the most new products - press on every cycling and tri- website - yet the public is not allowed into the site even for ONE day to look at the products. It’s like the cycling industry says - we don’t care about the public - we want you to go to your local dealer to find out about the bikes - don’t ask us directly.”

I agree this goes on and I understand why. I have mixed feelings about it. The industry puts a huge amount of faith and expectations in the hands of the retailers. Too much so, many say, as the biggest problem in the bike business IS the retailers. There are good ones out there, who do all the right things, but there are many who seem to want to do things their way or re-invent the wheel( pun intended). All that awesome design work all that cool marketing all those great promotional programs are often completely ignored by LBS’s. Why? I am not really sure.

Fleck

36

Seems a little bass-ackwards. Manufacturer relies on consumer to somehow get wind of their product, and then seek out a bike store that carries it. It’s then up to the dealer to really market the bikes.

If manufacturers were to shift their focus somewhat to the consumer, that consumer then creates a demand for the bicycles. If “Jim’s House of Two-Wheeled Fun” doesn’t carry Brand X, but enough people come in asking for it, it would stand to reason that Jim would look into stocking the line. Takes the onus of bike marketing off the dealer, and puts it in the hands of the guys who should be the “brand stewards” – the manufacturers themselves.

37

‘if you want something done right, do it yourself.’

if this is indeed true, then why are more bike companies not marketing to the consumer?

i’ve seen very few ads in Trimag et al. that have actually stood out, some ones by cervelo, and that lightspeed ad with the roadkill.

otherwise, there has been very little impact on me as a consumer to buy their products; however, there are MANY MANY ads for different shops.

could this have to do with the fact that many companies won’t let you directly order from them?

38

I don’t think that’s it. You can’s order a Taurus directly from Ford, either.

My suspicion is that when it comes to actual advertising execution, bike companies get nervous. Here they are, spending all this money on a single ad. It’s their one chance to talk to the consumer directly…so what do you do? Well, you jam in as much as humanly possible about the bikes, the manufacturer, the place its made, the history, the pets of the manufacturer, etc. Fill it to the brim with info, innundate the consumer with more than they ever wanted to know about the product.

Uh, wrong.

For advertising to successfully elevate the brand, it has one task: Be single minded in the message. You can’t be innovative and traditional, for instance. It creates confusion in the mind of the consumer. They’re left with a confusing message about the brand, which is almost worse than no message.

The other rule, which I see all too often ignored: If you can’t be clever, be clear. Too often, ads I see in tri/bike/running mags are neither.

39

“Just do it” - Nike

something like that then…repeated by the bike companies many times over?

40

Exactly. That’s the tagline version, the single-minded thought distilled into a single sentence.

It’s fine to have a paragraph of copy, as long as it’s touting the same, single-minded thought, and supporting it.

41

I was lurking here & thinking "What about PR?? Well I’m glad someone mentioned it… PR is absolutely huge for any company trying to promote a brand. We all know that advertising will always say that Bike X is the best thing since sliced bread, but if Dan Empfield writes a glowing review in Triathlete Magazine, then hot-damn that bike might be the real deal! PR works, no doubt. And it’s free. The trouble is, that you can’t get the Dan Empfield’s of the world to write positive things, and therein lies the challenge of promoting your message…

Gerard & Herbert posting on ST.com & giving their ideas to the masses is strong PR in itself. If these guys are willing to “get out there” and accept ideas from the bike-buying public, then I’m going to be test-riding Cervelo’s & Litespeeds next time I go into my LBS. Other companies should be doing more of this.