The
other day I saw a Dunkin Donuts TV ad promoting their new “Milky Way”
hot cocoa. I was shocked when my wife, who averages about 1.5 hot
cocoas a year, said she wanted it. The perception that there was some
sort of Milky Way component stirred into that hot cocoa must have
stirred some deeply rooted fond memories of Halloween candy bars and
chocolate goodness that she had stored somewhere in her psyche.
I
realize that the Dunkin/Mars hookup is likely more of a licensing deal
than one designed to actually place a candy bar in the cup – but
there’s a correlation there that applies to the world of beverages and
the occasional use of branded ingredients as a selling point for them.
Let’s
get back to my wife for a second. To her, the thought of a Milky Way–
its chocolate, or caramel, or nougat, or whatever else is actually in a
Milky Way – somehow spiking that hot cocoa was appealing. It connected
with her and actually made her consider changing her purchasing
behavior – and also actually succeeded in getting her to surprise her
husband, a process which, after three kids, is pretty hard to do.
This
type of reaction – the purchase, that is, not the shock – is the goal
of branded ingredients. It apparently worked in the case of my wife,
but for most branded additives, these attempts fall way short of this
reaction.
There
are some interesting and innovative things going on with ingredients.
Some of these ingredients are providing real benefits, being branded
and added to beverages across multiple categories. There is also a
breed of “in-house” branded ingredients that are created by marketers
in an attempt to boost a product’s point of difference and tout
“proprietary” technology behind their brand. Providing a real benefit
is an important component to the success of branded ingredients but
function is only part of the issue. Where most folks go wrong is in
using branded ingredients that are unknown.
As
marketers, we are always striving to create points-of-difference (POD)
and communicate these on our primary display panels (PDP) and so that
consumers will react quickly and favorably at point-of-sale (POS). In
the land of traditional marketing this is known as the PODPDP-POS
trifecta and it’s hung on the entryway to acronym hell. Some marketers
decide to take their creative skills beyond the front of the label and
onto the ingredient deck and although I admire the proactive approach,
this is where the trouble usually starts. They conduct R&D,
evaluate costs, make samples, and run tests, all in support of finding
a reason to believe that adding this-or-that branded ingredient to the
product, to the label, and to all the corresponding marketing material
will make a difference to consumers. Unfortunately, this expectation is
usually not met for one simple reason; no one knows what it is.
Familiarity (i.e. Mars’ Milky Way) is good. Unfamiliarity raises
questions. And before those questions are answered your consumer may
already be looking at another brand.
So
go back to the Milky Way example. Do you think my wife would have
wanted that cocoa if Dunkin’ Donuts was touting a new concoction made
with Mottolese Malt chocolate? Same ad. Same master brand. Obviously,
an even better taste, but instead of an ingredient with 85 years of
history (Milky Way) it has something unfamiliar. No Chance! Not even
the hypnotic strength that the Dunkin’ brand has over residents here in
Massachusetts could cover for that mysterious Mottolese ingredient!
Our
theoretical Dunkin’ brand could probably survive a few missteps, but
many of the younger companies that are using branded ingredients
cannot. Here’s a basic rule: if a branded ingredient cannot live on its
own off your package then it is not helping sell your product.
The
gorilla-sized exception in the room is Splenda, which is plastered on
countless brands. But Splenda worked because it had huge penetration, a
national media campaign, a thriving standalone product and a real
benefit (sweetness without calories). That combination made Splenda
very successful and one of the few exceptions in branded ingredients.
Like the Milky Way example, that blue Splenda symbol drove purchase
intent. Most other branded ingredients are only supported with a
violator on the label and a page on the company’s website, and they
deliver the results that are to be expected from this arrangement.
Consumers
have little tolerance for ambiguity in the ingredient column. I
experienced this first hand on a label I worked on where we developed a
“branded” word for our custom nutrient set. “CaCAZM” (ka-caz-zum) was a
fun word to say and was the acronym of the nutrients used in the
beverage. But the concept bombed in consumer testing. The “CaCAZM” name
had no relevance to the consumers. We recognized it would be a
distraction to build this in addition to the brand’s emotional and
functional benefits and it was pulled before launch. In general, people
expect creativity with graphics, label copy, packaging and flavor names
but want the ingredients to be straight-forward, easy to pronounce and
easy to recognize. Most attempts to create and brand ingredients in
this area are more detrimental than useful.
Creating
a relevant beverage brand is tough job. If a branded ingredient has
proven functionally and possesses a high level of consumer awareness,
then perhaps it could help. Otherwise, attempting to build a brand for
your finished beverage, while also building a brand for one of your
ingredients is just a bad idea. Most branded ingredients fall into this
category. So don’t be shocked if it fails.
Whatever you’re branding, call it Trash. Very
few things are as black and white as we would all like them to be, and
the successful application of branded ingredients in beverages is no
exception to that rule. The
fact is to date, I have not seen anyone successfully leverage a branded
ingredient to make a beverage have more market traction. There have
been many minor attempts – like Citri-Max – but truthfully, few have
been noteworthy enough to remember. As my snarky counterpart has
pointed out, unless you spend megabucks on a media campaign bolstering
the ingredient story, you won’t get much mileage out of the branded
ingredients – and even if you do, you won’t for long. Perhaps the most
memorable example is Nutrasweet (remember the red and white lollipop
logo?). When the patent ran out, so did the marketing support, and we
haven’t heard much of brand Nutrasweet since. We
marketers aren’t in agreement on too many things, but one area where we
stand united is that meaningful differentiation is at the heart of
successful innovation. So why does a unique and presumably efficacious
ingredient story not increase the relevance and therefore sales of
beverages? Three fairly significant reasons:
1. Lack of “Branded Ingredient” Recognition and Credibility
Most
of the branded ingredient stories I have seen have developed both the
branded ingredient and a new product. In other words, the ingredient
comes with no prior awareness, and therefore no prior credibility as a
reliable source for benefit X. One such product I worked on was a
collaborative effort with one of the premiere chemical companies in
this country on a branded soy protein. They had an agenda of
commercializing the soy protein in a multitude of products and we had
an agenda of increasing the perceived efficacy of our product because
of the branded soy protein. The challenge was which was a heated debate
about why we didn’t want to put the name of the chemical company in addition to the branded soy – on our beverage. Mmmm. Procter and Gamble Smoothies. You get the idea.
If
the branded ingredient existed as a standalone product with a specific
relevant benefit, prior to its addition to a beverage, people would be
more likely to both understand and believe that the beverage was
superior due to the inclusion of the ingredient. However, when the
launch of the brands is simultaneous, the ingredient is unlikely to add
much relevance to the beverage, at least without the mega-marketing
mentioned above.
2. Low Levels of Consumer Involvement
While
we have witnessed this strategy deployed successfully in other
categories, the critical difference is in consumer buying behaviors.
For example, “Intel Inside” once added to the perceived power of a
computer and presumably Intel commanded a premium for that power.
However, computers are a high-price, high-risk category. Naturally,
there is a greater degree of consumer involvement in the purchase
process, and people are willing to do some homework, as well as willing
to pay more to reduce their perceived risk.
Beverages,
on the other hand, are a low-cost, low-risk category, which leads to
lower consumer involvement in the purchase process. Unlike electronics
and automobiles, consumers don’t normally spend a lot of time doing
background research to find out what kind of a processor their beverage
includes. In short, average Joes won’t spend 5-10 minutes figuring out
if they are interested in trying a new beverage, including reading and
disseminating the believability of its branded ingredient story.