Wayne Lapasa

Sharing my Digital Marketing thoughts one post at a time.

Tag: Selena Gomez

Online Survey: Shoe Industry using Celebrities vs. Athletes

Sneaker companies historically have signed athletes to endorsement deals, including the creation of their own signature line.  The most recognized shoe pitchman in the industry’s history is Michael Jordan, a winner both on the court and at retail.  Despite being retired, he is a prime example of an athlete endorser continuing to sell well thanks in large part to his image and nostalgia factors.   The challenge today is to keep his Jordan Brand relevant to new customers who recognize him more for a crying meme than his legendary accomplishments.

Generally, when a shoe product launch rolls out, within 6-8 months the sneaker becomes discounted and loses its appeal.  The new marketing approach these days is utilizing non-athletes from different entertainment genres to use their social influence and appeal to move product.  Recent success stories such as Kanye West, Drake, The Rock and Kevin Hart have demonstrated their star power with sneaker apparel selling out at record numbers.  There is a new influence shift in how shoes are marketed, advertised and endorsed.

Executive Summary

An Internet Marketing Research study was conducted to determine who the next celebrity should be chosen for shoe marketers to drive new business for upcoming sneaker releases.  The study also gathered sentiment from respondents to find out whether a celebrity or an athlete played a role in the consumer’s purchase decision.  From March 1 to April 1, 2017, an online survey was sent to 58 participants via Facebook, Twitter, WhatsApp and SMS/text message formats.

In total 15 questions were prepared, focusing on consumer purchase habits, product pricing and who the next celebrity should be chosen to sell their own shoe.  Through a series of more qualitative questioning and less quantitative thinking, it was determined that actor Mark Wahlberg would be the next ideal candidate for a shoe company to invest marketing dollars for a future shoe release.  He was likely selected based on his well known fashion style habits, constantly color coordinating outfits with his footwear.   The secondary question that this research study wanted to find out revealed that 59% of respondents said that it did not matter if a celebrity or athlete was promoting the product, they were viewed as the same influential marketer regardless.  Consumers also stated that a celebrity endorsed shoe should not cost more than an athlete endorsed shoe, which is the current trend in today’s marketplace.

Recommendations suggested were a focus group study to gather additional information and identify micro and macro key influencers through conversational and influencer listening sessions.  Overall, the survey helped gain valuable insight for shoe marketers to understand which celebrity to invest in and to also better understand consumer purchasing patterns.

Defining the Problem

  • Identify the next celebrity who is influential enough for a shoe company to invest in
  • Examine whether a celebrity/athlete endorsement has any affect on a consumer purchasing decision

Stakeholders involved:

  • Customers – They are the primary target audience to purchase the product
  • Athletes – Original primary endorser, additional income stream affected
  • Celebrities – The new social influencer in the shoe industry, new income stream possibility
  • Fashionistas/Bloggers – Looking for additional content to publish, discuss, curate and create engagement
  • Shoe companies – Creator of the product, looking to generate sales / profit
  • Sneaker retailers – They are carrying the product and provide showroom to the product

Research Design

  • Online survey produced via Google Forms – https://goo.gl/forms/6ICsX0PyqLCYsHFO2
  • 58 people participated (43 Male, 14 Female, 1 undeclared)
  • 15 total questions
  • 10 Qualitative questions / 5 Quantitative questions

Fielding

The survey was dispersed through the following portals from March 1, 2017 – April 1, 2017:

  • Friends & family
  • Facebook
  • Twitter
  • WhatsApp
  • Text message (SMS)

Selected Data Analysis

Some interesting consumer insights here is that the second highest percentage result was 57% stated that they purchase shoes from outlet stores.  This confirms that consumers are willing to wait for a shoe release to drop in price – even if that means waiting for an out of season product to be sent to the outlet shops for a discounted price.

Nearly 30% and 25% polled that style and comfort are instrumental factors over performance (3%) and price (4%).  The consumer values more visual aesthetics over the actual performance features the shoe can offer.

From a visual communications standpoint, 75% of respondents preferred Instagram as their main social channel for shoe information.  Marketers do an excellent job with image composition (i.e. knolling shot) that promote and create interest for product releases.  Facebook scored higher by 4% over blog sites, but the reality is that those posted links are most likely being shared from blog articles, which provide more in-depth production information.

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The 4 Stages of Influence Marketing

1) Traditional Word of Mouth

Traditional Word of Mouth marketing refers to the process of passing information usually of a product or service to a non-commercial partisan without any financial gain.  It is possibly the most recognizable form of promotion and most influential among consumers.

Word of mouth techniques usually are best applied through friends and family.  Roughly 92% of consumers actually prefer to be recommended a product or service by someone they know.   Word of Mouth marketing also known as WOMM, is responsible for 20-to-50% of all consumer purchasing decisions.

Word of Mouth

Pros

Cons

–          A free referral, no cost at all to the product company

–          Company saves on advertising $

–          Friends and family become a trusted source in purchasing influence

–          Negative reviews on a product can harm a company’s reputation

–          Not easy to monitor WOM purchases from a marketing metrics perspective

–          Process may take a while to spread interest immediately

A recent example where Word of Mouth marketing worked huge wonders was at the 2017 Golden Globes awards show.  Donald Glover proclaimed in his Best Actor in a TV Comedy series speech that the Migos song “Bad and Bougee” was his favourite track.  With Glover essentially co-signing the Atlanta rap group on a national live broadcast, it helped sparked curiosity of the trio, who were not known to the mainstream masses.

Migos’ Spotify streams soared to an astronomical 243% increase within 24 hours.   The song also jumped to #1 on the Billboard Hot 100 thanks to Glover’s mention.  In the past, CD sales would have been the medium to measure, but that process would take roughly a week to get the results.  In this new age, numbers are produced within hours thanks to social currency.

Another Word of Mouth example is the clothing brand Roots of Fight.  They are a Canadian based apparel company that has licenses/royalty deals with select retired sports athletes.  Since 2012, their retro inspired designs continue to be a major success with sports fans – including the athletes and entertainers as well.

According to a 2015 AdWeek article, stars from The Rock to JAY Z and Beyoncé have been photographed wearing the brand while being compensated $0.  Roots of Fight scored large in Word of Mouth marketing without heavily investing into their own marketing and advertising.   Instead, consumers of the brand famous and non-famous helped generate the buzz for the company.

2) Celebrity Influence

Celebrity Influence is the act of hiring an established identity usually in the world of entertainment or sports, to sell or endorse a product or service.    Their image and likeliness is positioned in advertisements, commercials, images and videos as an advocate of the paying brand.

Having a recognizable face that is admired by their fan base can play a huge role in the promotion of a product.  By associating their own brand image tied to a commercial idea, this creates the message that consumers can somehow look or emulate their admired personality.   Some of the key factors companies look for in a celebrity is their overall popularity, how relevant they currently are, their reputation in the public eye and their differentiation from other personalities.

Celebrity Influence

Pros

Cons

–          Influence consumers to buy a product or service

–          Help build awareness for the brand

–          Can help revive an old brand with a previous declining identity

–          Celebrity may come across as unauthentic in selling

–          Celebrity might get into trouble in the public eye, which affects a brand’s image

–          Having a celebrity sell a product can create false hope for a consumer

An example of a celebrity influencer is NBA star LeBron James, a Nike signature athlete since 2003.  He broke barriers by being one of the first athletes to make more money in endorsements than his actual playing salary.  LeBron’s raw athleticism, team leadership and championship qualities make him a desirable pitchman for the swoosh brand.  His apparel and signature shoes continue to be top sellers in the footwear industry, with 2015 sales reaching $400 million.  “The King’s” latest contract with Nike calls for a lifetime deal worth $1 Billion.

Another example was the successful ALS Ice Bucket Challenge, that took place in the summer of 2014.  Through social media, the video challenge called for donations to a worthy cause.  By simply pouring a bucket of ice cold water and calling out your friends to participate in the challenge, this helped raise $115 million that went towards Lou Gehrig’s disease research.  A big success in this viral sensation were A-list celebrities, who participated using their influence to encourage others to donate.  Achieving this level of support would have been challenging to accomplish in the pre-Internet area.

3) Crowdsourcing

Crowdsourcing involves the assistance of a large group or audience, who offer their input and insight with their participation in a given project.   They usually appear as an online third party used to outsource certain tasks.  With their input comes valuable insight on a social, business and political level.    Author Jeff Howe was credited with coining the crowd sourcing term in a 2006 Wired magazine article.

It is a collaborative effort that harnesses unique creative minds that can educate and problem solve.  Thanks to the world being digitally connected, it is easier to crowd source with giant numbers in a short period of time.  Crowdsourcing has even evolved into other forms of crowd usage such as crowdfunding, which involves the search of investors for monetary support that would traditionally be ran by a financial institution.

Crowdsourcing

Pros

Cons

–          The outsourcing of labour is usually free

–          Access to skilled and qualified personnel, with a variety of shared knowledge

–          Can offer short term solutions and collect transparent real time data

–          Quality control of digital users online, who are trusted and reliable is a concern

–          Project management in handling large crowds can be tricky

–          There is really no form of regulation

Potato chip maker Lays is an example of a brand that used crowd sourcing effectively.  For the past few years, they have reached out to their customer base to come up with new chip flavours they can market and sell.  Their campaign titled “Do Us A Flavor” received thousands of entries, with many of them inspired by existing popular regional dishes.  The 2015 winner “Southern Biscuits and Gravy”, ended up being sold in retail shops across the country. The creator behind the winning flavour was awarded $1 million or 1% of that flavours net sales (whichever was higher after one year).  Thanks to crowdsourcing, Lays were able to harness audience participation and at the same time create a new product to sell on the marketplace.

Veronica Mars was a popular mystery drama TV show among teens that ran from 2004-2007.  In 2013, the show’s head writer Rob Thomas reached out to long time fans of the show if they wanted to see an adaptation on the big screen, but would require crowdfunding.  The Veronica Mars fan base responded in record time, raising more than three times their original asking amount via a Kickstarter campaign.  Whether or not the film met the expectations of those who contributed, this is an example of crowd-sourcing and crowdfunding coming together to help out a cause for a dedicated fan base.

4) Social Influencer

Social Influencer marketing relies primarily on the presence of an individual that has social influence to impact a consumer’s purchasing habits.  While a celebrity can fit in this category, it can really be anyone with an audience.   Those people could be a blogger, a relative or a colleague.  Also known as “Social Proof”, their voice, knowledge and persuasion play a pivotal role whether they realize it or not.

Social Influencer marketing is somewhat like Word of Mouth marketing, but the big difference is that a social influencer has a more refined and established identity.  A Word of Mouth idea can start as hearsay information and eventually spread like wildfire to the masses.  Where as a Social Influencer marketer generally has a social channel set up, with different platforms to promote or review a products and services.

Social Influencer

 

Pros

Cons

–          Usually a knowledgeable and credible source

–          Able to provide product / service reviews and recommendations

–          Influencers can reduce sales cycle time, can up the process by acting as a brand advocate

–          Social Influencer might use their platform simply for monetary gain

–          This can lead to consumer mistrust

–          Compensating a Social Influencer can come with a hefty price tag

In the past, celebrities would make their money through print and billboard advertisements.   The mediums have since evolved and mobile advertising has exploded.   An entertainer like Selena Gomez, who has a combined Social Media following (Facebook/Instagram/Twitter) of 216.5 million followers, has some serious advertising clout.  A posting on her three social platforms currently have a value of $550,000.   As of this writing, that metric is currently the highest earning value of any celebrity in the world.  This high value is also attributed to her engagement level with her audience.  She is in a favourable position to select who she wants to advertise with.  She can work with companies that fits her personal brand, rather than commit to the easier sponsored post payout.

A smaller scaled example of a Social Influencer is YouTuber Chris Chase aka nightwing2303, who runs a popular shoe review website called WearTesters.com.   On his video blog, he is known to give the most honest critique of the latest shoe releases on the retail market.  His voice provides expertise on everything from the quality on the shoe materials, to how they perform on the court.  With over a quarter million subscribers on YouTube and close to 100,000 followers on Instagram, his opinion and reviews are among the most respected and trusted in the sneaker community.  His influence was put to good measure after Jordan Brand provided misleading product description in a recent Air Jordan retro release.  He represents a new generation voice of Social Influencers who can make a comfortable living in the comfort of their own home.

Resources

“Celebrity Marketing | What Is Celebrity Marketing?” Celebrity Marketing | What Is Celebrity Marketing? Marketing Schools, n.d. Web. 24 Jan. 2017. <http://www.marketing-schools.org/types-of-marketing/celebrity-marketing.html>.

Chuck, Brad. “Why Influence Marketing Is No Longer in the Hands of Celebrity Endorsements.” LinkedIn. LinkedIn, 7 July 2016. Web. 25 Jan. 2017. <https://www.linkedin.com/pulse/why-influence-marketing-longer-hands-celebrity-brad-chuck>.

Fryrear, Andrea. “We Investigate the Pros and Cons of Influencer Marketing so You Don’t Have To.” MarketerGizmo. MarketerGizmo, 17 Mar. 2017. Web. 25 Jan. 2017. <http://www.marketergizmo.com/we-investigate-the-pros-and-cons-of-influencer-marketing-so-you-dont-have-to/>.

Fung, Tim. “The Pros and Cons of Crowdsourcing.” The Weekend Australian. News Corp Australia, 10 July 2013. Web. 26 Jan. 2017. <http://www.theaustralian.com.au/business/business-spectator/the-pros-and-cons-of-crowdsourcing/news-story/9ec9c88a62137d0e425bdfecb2c623ff>.

Jade, Zahara. “What Is Social Influence Marketing?” HireInfluence. HireInfluence.com, 09 Oct. 2016. Web. 26 Jan. 2017. <https://hireinfluence.com/blog/what-is-social-influence-marketing/> .

Lake, Laura. “What Is Crowdsourcing Marketing and How Is It Used?” The Balance. About, Inc, 6 Aug. 2016. Web. 25 Jan. 2017. <https://www.thebalance.com/what-is-crowdsourcing-marketing-and-how-is-it-used-2295467>.

Mooney, Lisa. “The Disadvantages of Word of Mouth Advertising.” The Disadvantages of Word of Mouth Advertising | Chron.com. Hearst Newspapers, n.d. Web. 27 Jan. 2017. <http://smallbusiness.chron.com/disadvantages-word-mouth-advertising-26133.html>.

Weiner, George. “5 Reasons Why the ALS Ice Bucket Challenge Was Successful.” Whole Whale. Whole Whale, 05 May 2016. Web. 26 Jan. 2017. <https://www.wholewhale.com/tips/ice-bucket-challenge/>.

Welsh, Steve. “Welcome to #TheSocialInfluencer.” Social Influence Is the Holy Grail of Social Marketing. Oracle, n.d. Web. 27 Jan. 2017. <http://www.oracle.com/oms/social-influencer/blog-sw-influence-2212090.html>.

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