Marketing at Wharton Lucian Ionescu

Coca Cola team post and thanks

2005-06-23T08:33:00.000-07:00

After a short and intense term, Jenny, Holly, Andre, Sheharyar, Raj and Lucian finalized the Coca Cola team project. Andre posted the report on his blog. It was a great experience working with you guys. Thank you very much for sharing your thoughts, expertise and friendship. Thank you Alex for teaching us this wonderful class. It had an impact on me for sure, as for now on I promise to think in a more socially responsible way. And since this is my last class in the Wharton Management Program I would like to add special thanks to Michael and Jenny, two great colleagues with whom I shared great moments here at Wharton. As some of you know, I will move to Europe in a couple of months, and continue my career in an International MBA program at Vlerick Leven Gent Management School, close to Brussels.

Wikipedia - challenges

2005-06-22T05:05:00.000-07:00

I got fascinated by this wikipedia platform. Could this be the next google in terms of impact on the internet world (of course different angle). Alex, Andrei and Sheharyar are blogging on this. Wiki is going to grow exponentially in terms of penetration and visibility. But I noticed that each “language version” has more or less its own different information. In other words, it is not a translation from English into different languages. So more information posted there, but access and penetration is limited because of language barriers. So, how do we overcome this and integrate an “open source” to open the information from the Romanian site to the Russian reader, and so forth?
For our “code writers” and not only: how do we integrate a "wiki-like" project with an extranet/private/company-specific application? I find the wiki very useful in terms of resources and visibility, I want to use it as a CEO, but I do not want all the internal discussions to go out. So ok, open source, create the platform, how do I protect company and employees?
One more comment: they do have an International Wikimedia Conference as well.

Extra credit - I'm on Yahoo

2005-06-21T06:30:00.000-07:00

I was able to spot my blog on Yahoo. Although I realized that some Romanian fellows in academia or banking industry took my name for fame and glory, I still managed to come in the 7th place on Yahoo.

MKTG related post 2 - The future of ads could be in cyberspace...and they use a blog to promote it.

2005-06-18T17:07:00.000-07:00

Recently Google has launched a new AdWords feature creating the option of targeting customers by running site specific ads. This is to me the finesse of segmentation and targeting, since Google will analyze the content on a web page and then deliver matched ads, based on categories and keywords. Marketers have to bid on those keywords and they are charged per click and per day, according to their budget.
To me this is an extremely precise form of targeting THE consumer most likely to be interested in a specific product or offer. To make it more exciting the all mighty Google decided to blog about it and it looks like people got into it. What is next? Market research through scanning our brains, and creating the “personal interests” profile?

Reference Post - Holly's story on Coca Cola factory in Somalia

2005-06-14T20:33:00.000-07:00

Although my first thought about Holly’s post was….. “yet another fortune at the bottom of the pyramid example” , I believe that projects like this could be at least in part “Somalia’s hope”. My curiosity went further and I tried to find the local Coca Cola website. There is none. Yet. I found instead a related article, again at BBC, by the same correspondent (Mr. Grant Ferrett). The comments that are posted there are very suggestive for the emotional involvement of natives of Somalia, with respect to this project. Along these lines, the Company’s “citizenship” chapter is also worth mentioning. But what struck me from the two articles was the ownership structure. It sounds to me that the Somalese factory is run as a franchise If so, to what extent the “local” shareholders contribute to the promotion strategy? Or further, can they be forced to create “citizenship” programs? It would be interesting to find out more about the decision making and ownership processes at Coca Cola worldwide branches.

The Coca Cola Company Team - Promotion expert post

2005-06-14T17:19:00.000-07:00

The Coca Cola Company is one of the leading manufacturer, marketer, and distributor of non-alcoholic beverage concentrates and syrups in the world. The company’s mission statement is: "The Coca-Cola Company exists to benefit and refresh everyone who is touched by our business." The company is determined to “make great drinks….and….contribute to communities around the world” .

In its more then a hundred years of existence, Coca Cola Company focused on finding new ways to grow total beverages sales using a wide variety of value adding promotional events. For many years, Coca Cola used television as a core promotional tool. It dominated the TV ads, used this channel to inform consumers about products, and carefully positioned on the market. In the last decade, media fragmentation, technology and change in consumer behavior contributed to the decrease of the efficiency of television advertising.

In response to this trend, Coca Cola developed a new promotion strategy, trying to reach beyond passive TV ads. The company moved toward an experiential approach, using events and activities to build a closer bond with consumers. The brand started developing strategies to infiltrate into the consumer’s daily routines. From sports to music to the Internet, Coke became lately part of our active living. Through “The Coca-Cola and sports” partnership on The Olympic Games, Soccer and Tennis all over the world, Coca-Cola has built on its association with sport and the spirit of competition. The strategy is to create a dynamic environment in which activities on events, experiences and environments offer relevant meaning to their target consumers. Promoting during these activities, Coca-Cola creates the promise of a complete refreshment with a sense of celebration and passion. This “package” boosts the overall consumer experience and creates a feeling of inclusion.

In the digital era, there is no doubt that competition and technology will create new forms of advertising. With prices of TV ads skyrocketing and consumers confused by too much advertising, Coca Cola will be for sure one of the companies that will shape the future of promotion. Subtle advertising projects like www.mycokemmusic.com or TXT FOR MUSIC on-pack promotion will work towards bringing The Coca Cola Promise in every house.

Through supporting educational and health programs Coke will be more commited to rising awareness in communities and improving the quality of life.

Promotion post 2 – Presentation - Don’t give to much away

2005-06-13T08:02:00.000-07:00

Now that we are getting close to the end of our MKTG class, the message becomes clear: “create customer value and satisfaction”. Sales Promotion is part of the game, and, according to Kotler et all (page 509) companies are developing today more sophisticated “short-term incentives to encourage purchase or sales of a product or services”.

In Managing Customers as Investments: The Strategic Value of Customers in the Long Run (Wharton School Publishing), Sunil Gupta and Donald Lehmann try to quantitate the lifetime value of a firm’s customers in order to take action on customer management issues and make better strategic decisions. Developing Sales Promotion Programs is at the core of attracting and managing customers, yet one classic sales promotion mistake is to make the promotion worth more than the value of the product intended for sale. The result: people will buy the product only for promotion, and there is no long-term relation with the customer

The book presents this concept through one of the case studies, illustrating the gap between beliefs and actions. Luckily, this chapter is available online. To make a long story short, in 1992, Hoover (the vacuum cleaner company) created a Sales Promotion Program during which they offered two round trip airline tickets from the U.K. to anywhere in Europe for anyone who bought Hoover products worth about £100. This promotion turned out to be extremely successful and it encouraged company’s managers to follow up with another promotion that offered two round trip airline tickets between the U.K. and U.S. with the purchase of Hoover items worth of £250.
Almost 200,000 customers accepted these promotions, leading to “promotional” charges of £48.8 million. As a result, the firm registered a huge sales increase with disastrous profits. The company had to end the campaign and terminated the jobs of many of the (“ir)responsible” executives who designed and endorsed the promotion.

This is an extreme example of course, but the message is clear: More promotion could lead to more revenues but not necessary to more profits. Companies need to invest in promotion programs after identifying the tangible impact of these marketing investments.

MKTG-related post 1 - More than a simple "regulatory affair"

2005-06-12T18:16:00.000-07:00

This was for me a MKTG411 weekend. And I bet for at least a few of you :). While reading the “Promotion” chapter in Kotler, I got a better picture of all those structured promotion tools. At the same time, while surfing for Coca Cola “material” on promotion, I came across a very interesting article that raises awareness on the issue of differences in regulatory affairs between Europe and US. It is well known that the pace and path towards a new drug approval are different here vs. EU, or that the European Commission and SEC are working hard toward integrating the differences in accounting principles across the ocean. Everybody knows Microsoft’s problems with the European regulatory affairs. Now, one more example: contests, sweepstakes or premiums are frequent tools used to promote various products in US. In Bulgaria promotion of a Coca Cola game - in which company offered prizes to buyers who sent back to the company ten-bottle caps - was penalized, in an attempt to decrease company’s market share and increase competition in the European carbonated-soft-drink market. I wonder if there is any legal instrument that would limit/prevent different forms of advertising/promotions of a dominant company in the US, as an indirect strategy to increase competition in the market.

Promotion post 1 - Is there a market for Logan?

2005-06-11T16:13:00.000-07:00

With most of technology coming from Nissan, the French carmaker Renault built (at its Romanian subsidiary) Logan, a low cost car, with initial plans to sell it in emerging markets. Further market research revealed that an economic car could be a success in Western countries as well. I followed this closely, since it is supposed to be one of those outsourcing stories related to Romania. After a successful debut on Eastern European markets, Logan was launched in Western Europe as well. To my surprise, with little/no advertising .

Their strategy: a clear market target (buyers who otherwise would get a used car, or another low cost car), a new brand development, and an effort to avoid cannibalization of the low cost cars sold under Renault brand.
It is debatable though, why did they choose to sell Logan under Dacia’s (the Romanian car company) name, as opposed to Renault. How do they position on the market? Is the “More for less” value proposition enticing enough to create a 1 million-unit market by 2010, as they claim?

For more information about Renault's profile, visit
http://www.auto-report.net/index.html?renault04sales.html
http://www.detnews.com/2005/autosinsider/0503/01/autos-104401.htm.

Intro post 2 - I can do it

2005-05-31T15:44:00.000-07:00

Related to our class, I came across an interesting article - Managing Brands in Global Markets: One Size Doesn't Fit All - this week in Knowledge at Wharton . It is focused on the question whether global brands should stay “global” and sell their products and services with a similar approach everywhere on the globe, or should adapt their brands to local culture and conditions. As a side, I noticed that some of our MKTG 411 “companies” are established among the “global” brands that exist today. Do you feel that your “team company” meets the following criteria?
-a consistent name that is easy to pronounce;
-corporate sales are globally balanced with no dominant market;
-the essence and positioning of the brand is the same the world over;
-the same target segment, in every market;
-similarity in execution (pricing, packaging, advertising) across cultures?

Then it has a similar approach in every market. Or do they adapt brands to local conditions? Is the global and local approach the key of a successful marketing mix?
I invite everyone to read the article.

My short intro post 1

2005-05-26T04:36:00.000-07:00

I am a Romanian doctor trained in Bucharest. I have been working in the States for five years now in medical reasearch. Right now I am a Research Scientist at UPenn School of Medicine