Research Paper Outline

I. Introduction

a. Thesis: Nike has evolved the way it uses its unique ability to gauge insights from customers and incorporate them into its branding through communications and offerings through the years

i. Advertising

ii. Experience

iii. Product Customization

II. Body

a. Advertising

i. Changes over the years

1. Nike started moving towards television ads in the early 1980s

2. Back then the company focused more on track and other Olympic-geared American sports, however, its product line expanded towards many other sports throughout the world

3. Late 80s saw the creation of the slogan “Just Do It” as well as the Michael Jordan era of athlete endorsements

4. Nike has garnered a tremendous amount of athletes for sponsorship—most famously Pete Sampras, Tiger Woods, and now LeBron James

ii. Nike uses advertising to draw customers closer to the brand

1. Brand creates an image that resonates with a customer whether it’s through emotional appeal or by using one of the many endorsed athletes

2. Nike lures customers with a marketing strategy centering around a brand image which is accomplished by promoting a distinctive logo and its world-famous advertising slogan

b. Experience

i. Nike has made a point to utilize the experiential part of their offerings towards making a connection with customers and their feelings

1. Niketown is a place where true Nike fanatics can find just about any product offering they desire

2. In addition to finding just about any Nike product, they can talk to other Nike followers as well as employees and managers and get more acquainted with the brand spirit

3. Nike also promotes usage of products under different functionalities

a. EX: Air Nike Cole Haan dress shoes

b. This allows customers to fall in love with the brand and use it in all facets of life

c. Product Customization

i. Nike has now shifted towards a completely customizable line of products

1. Nike allows its customers to go online on their website and use NikeID in order to create their own product out of an existing one

2. This customization feature allows the user to choose colors, styles, and personalized inscriptions on their preference of Nike items

3. Such a product offering truly allows for company to gain understanding of what customers truly want in a shoe, shirt, jersey, or accessory

4. Nike has also teamed up with Apple to create a new technology called Nike+ which allows users to track the way that they run

III. Conclusion

a. Restate thesis and how it is addressed through the paper

b. Summarize main points as well as key research findings

c. Conclude with a detailed summary of the key insights Nike utilizes as well as how the paper applies towards customer insights issues

See these ice cubes? See these Ice Creams?

I am currently working on a project for my Marketing Policies class, and the client which my team is working with is none other than Amy's Ice Creams. Having met Amy herself, and proceeding to think about the business and its intricacies, I began to wonder more about the interesting world of ice cream vendors. The thing that intrigued me, and ultimately inspired me to blog about the topic, was the fact that eating ice cream is all about the experience.

Ice cream is readily available to those who want it. Good ice cream is available to those who look in the right places. Premium ice cream is... well, I'm not entirely sure what or where it is, but Amy's Ice Creams (along with Marble Slab, Cold Stone, etc.) claims to offer it.

The premise that I write this blog upon, however, is what drives a person (or a group of people) to eat ice cream at a vendor such as Amy's or Cold Stone. Why not just eat the ice cream at home? Why not buy a container and enjoy it over a movie - it's cheaper that way.

I, personally, am not an avid ice cream eater. I know plenty who are though, and they seem to specifically enjoy ice cream runs in groups of two or more. They are willing to pay more for ice cream at say Amy's (from here on out, I will focus on only Amy's Ice Creams) than they would for a big tub of ice cream at HEB which tastes probably just as good--just without the fixings. My question then becomes: what about this experience makes you want to pay a premium for ice cream? I have begun to compare it to engaging in consumption of alcoholic beverages downtown (come to think of it, almost anything is an example of this... food, movies, etc.) You are in a social setting with friends and you all decide to go out for some drinks. You end up paying probably about at least double what you could have paid if you bought a bottle and mixed the drinks yourself at home. This very insight is the driving force behind the blog topic. Why do consumers purchase items or services at a premium when they have the choice of a cheaper alternative at their disposal?

Focusing on ice cream, specifically Amy's, is the experiential aspect of eating ice cream there. Amy's is supposed to be a fun-loving, cooky, and zany type of atmosphere which patrons are supposed to enjoy to the fullest. This is arguably the reason why people go to eat ice cream there. The customer is given multiple options to choose from, especially when throwing the "crush'ns" in the mix. At home, the consumer has only 1 maybe 2 flavors at the most (I don't suppose many people have 3 different types of ice cream in their home unless... they just splurge). Still to me, the very-occasional-ice-cream-eater, these reasons are simply not enough.

As a result, I have been led to conclude that eating ice cream at a shop like Amy's is entirely emotional/experiential. Perhaps eating Amy's reminds people of eating ice cream after baseball games when they were a kid. Maybe people's parents used to buy them ice cream after getting all As on their report card. I'm convinced emotion has so much more to do with it than the combo of flavor and toppings. In addition, experiencing ice cream at a vendor with your friends during a study break or after a long day out playing sports is part of the Amy's experience. These emotional drivers are the aspect of the project which most interests me.

Rapaille-tilian Hot Buttons

The reptile in you.

Dr. Rapaille is a former European Psychologist turned Market Researcher who believes consumers are driven by "unconscious needs and impulses." He claims people make up reasons which attempt to try to make sense of or justify their behavior when in reality they truly have no idea why they act a certain way. He has developed a 3-stage technique which consists of:

1. Past reason
   
2. Through emotion
3. Primal core

In the first of the stages, Rapaille conducts a series of focus groups in order to gauge what types of responses the subjects will give from the word "luxury." These responses are meant to draw upon associations that the participants may have with the mere thought of luxury. Rapaille looks for and embraces any response, no matter what it may be, in order to allow the respondents to feel like they did a good job and are comfortable with the study.

In the second stage, Rapaille attempts to draw emotional queues from respondents by asking that they tell a story as if they were speaking to a 5-year old from another planet. He explains that by doing so, the participants no longer try to use logic or sound intelligent but instead begin to use simpler means or thoughts in order to provide an explanation and convey a message or meaning. His intention is to confuse them while putting them in this completely different mindset.

Lastly, the third stage hunts for the "primal urges" which consumers often feel when making a purchase decision. Rapaille insists that all purchasing decisions really lie on one's primal core. In order to accomplish this task, the participants are asked to lay down and relax in the room which has had all of its chairs removed and proceed to take a frame of mind similar to one of waking up in the morning. He then attempts to capture these thoughts that would otherwise not display much prominence given a different set of circumstances. By doing so, he can "unlock the luxury code" through the means of obtaining something he dubbed the "reptilian hot buttons" which he believes ultimately encourages individuals to take action.



Mr. Rapaille went on to discuss the importance of finding the "code" and how everything suddenly makes sense afterward. It was mentioned that a French cheese company trying to market cheese in America was "off code." He did not mention what the code was, but alluded to the fact that in France, cheese is "alive" and is therefore not stored in a refrigerator--compared to the U.S. where almost all cheese is refrigerated, hence "dead." The fact that the company was promoting the cheese off-code, according to Rapaille, caused for inappropriate marketing tactics.

That song, so-so-so song.



Song Airlines was supposed to be a new fashioned, low-cost airline under the ownership of Delta Airlines. In my opinion, the experience that Song is trying to create was a good concept--however, it became too much of a concept and not enough of a service. Song wanted to target a certain type of customer, and that was a good idea, however, Andy Spade failed to put enough of a tangible aspect of the product and service that Song was offering which therefore made the consumer lack knowledge about what Song really was: an airline provider.

One thing that song did really well, in my opinion, was the fact that they were able to obtain a deeper understanding of the customer and their wants/needs when it came to flying. Song relied on focus groups and other means of research to figure out how women viewed flying and what sort of issues they felt were commonly ignored on a typical airplane provider. Women and their insights became a driving force for Song airlines, they went as far as creating a profile for their target consumer and naming her. This emphasis on insights and what the consumer really wanted in an airline provided Song with an ability to truly tap into the desires of the target audience and ultimately drove most of Song's features such as satellite TV and organic meals.

Song's real flaw in my mind was its inability to truly exhibit to the consumer its true benefits and what differentiated the airline from other airlines. Spade wanted to pursue a more intangible type of benefit as opposed to highlighting the airlines features. While this is great in its own way, it was not a good idea given the circumstances which Song was dealing with. The airline industry was a struggling one, and consumers knew that. In addition, anyone who is a purchaser or has any sort of purchasing power will be more likely to purchase a product whose features and benefits are well laid out and tangible yet useful. In Song's case, not only did the advertisements as well as the other means of promotion fail to lay out the features, they also failed to deliver the message that Song was an airline provider. Almost 50% of people who had "heard" about Song did not know that it was an airline. If your consumer does not know what product or service you offer, how can they purchase it, or, more importantly, why will they purchase it?

No one is going to fly on an airplane because of some subliminal emotional message they saw on a commercial--they are going to decide on which flight to purchase by evaluating first the price, and then the features that the airline offers. Spade had a good idea, but it just was not right for what Song needed to do. It was too early for the young airline to try to tap into consumers' emotions. The airline had to differentiate itself through its consumer-friendly features such as organic meals, satellite TV, and most importantly low-cost fares. Most importantly, the airline had to show the consumer what it was--an airline.

A Marketer's Dilemma

After reading "Kenna's Dilemma" I became convinced that sometimes the public just does not know what it wants. Consumers not only react and feel differently when using a whole product over an extended period of time (as in the home-use tests used in the Pepsi vs. Coke battles) but they also tend to have difficulties explaining feelings about unfamiliar things. These two issues are what I feel are the most important takeaways from the chapter in regards to a marketer trying to gain insight from customers.

When testing products, a simple sip allows for subjects to get a sample of a product (in the case of the reading, it was Coke or Pepsi). As mentioned in the reading, people react differently when trying out an entire can as opposed to just a sip--especially when testing a product over a longer time frame, say, a week. Market research is a tricky thing. Sometimes, subjects answer or react differently to a product under a controlled experimental atmosphere than they would under no supervision in the privacy of their own homes. This is why sometimes you've got to trust your gut.

The first example the popped to my mind was the beverage Snapple. Throughout Snapple's history, the bottler has rolled out over 75 different flavors. As far as my understanding goes, not one of them had been subjected to any type of market test. Snapple simply rolls out a new flavor, puts in on the market, and sees how buyers respond and use performance as a benchmark. The reason Snapple was able to do this for so long was because of the economies it had built through its distribution network. It was relatively inexpensive to create a new flavor, put it on the shelves, and see how well it sells. Consumers were able to purchase and drink Snapple, garnering the full experience of the product--not just a sip. To me, real-life performance is the best way to measure the strength of a product or service--not a bunch of simulations to constituents who (hopefully not) may not ever use the product in the first place.

In the case of Kenna, his music was so off-the-wall that there is, in my mind, no way that a group of music analysts would have been able to identify the type of listeners who would enjoy Kenna's unorthodox style. Kenna is definitely the type of artist who would develop a cult following (known to market industrialists as a niche). This, to me, taints the effectiveness of market research. Yes, a lot of the time, market research is highly useful and a decent predictor of performance. However, a good amount of times (and with today's extreme diversity in tastes and preferences) the tested subjects' perception does not truly account for the outside variables that affect how great a product or service can truly be. Kenna's different style of music appeals to a different style of audience. Personally, I hardly ever love songs right off the bat--they have to grow on me, and that takes time. How can that ever be accounted for through a listen-and-respond 15 minute questionnaire?

In 1985, market research was nowhere near as sophisticated as it is in 2009. I do not know if there was any market research done when Nike's team worked on developing the Air Jordan I. These shoes were definitely the first of its kind. Historically, basketball shoes had been white or black solid colored shoes with a more traditional, conservative look. Nike literally put all of its eggs in one basket with these revolutionary kicks. People had never seen anything like them before, and thus would probably react negatively to them--initially--due to unfamiliarity. Michael Jordan was the man they would depend on to save their company. Now, even to a pure basketball lover such as myself, the shoes are somewhat unattractive (I have always wondered what I would have thought of them if I was a teenager in 1985). They are bright, loud shoes with a boxy yet plain design. I'd be willing to bet that if a group of respondents were surveyed and asked "How likely are you to buy these shoes?" the results would tell a whole different tale than what actually took place. Jordan was a rookie in the NBA at the time, and the NBA banned the shoes because the league felt that it violated uniform codes. Jordan (prompted by Nike management) continued to wear the shoes, and begin to receive fines from the league (which Nike gladly paid for). This created a buzz so definitive that the shoes began flying off the shelves and fans could not wait to get their hands on a pair of forbidden basketball shoes. It boded well that Jordan was a... decent... basketball player and was playing well at the time. Couple this fact with the aided publicity and you've got yourself a knockout product. This anecdote serves as an example for both how consumers will react and feel differently over an extended period of time and tend to have difficulties explaining feelings about unfamiliar things.

Consumers do not always know what they want-especially as their preferences begin to change over time. There is no cut and dry way to simulate a human brain and how it will react to a new song as it plays more over time, a new drink as they begin to experience it while doing their everyday things, a new shoe as it gains popularity among different human channels, or a new style of chair as they see it gain prominence. Sometimes, you've got to trust your gut...

Just do it.

Surprise, surprise. When debating on what topic I should choose for my Customer Insights Current Topics Report, I wanted to do three things:

a. I wanted to do something that I would be really passionate about
b. I wanted it to be sports related
c. I wanted it to involve Nike

Lo and behold, I had already made my mind up without really thinking twice. My three points really (purposely) left me with no other choice. I have managed to make some sort of Nike shoe reference in all my previous blogs. Now I finally have a chance to actually make it the focal point.

In case it's not already clear, I plan on discussing Nike for my report. However, it is not entirely clear to me yet as to what exactly I will be focusing on.

Nike's a global marketing giant. The artist formerly known as Blue Ribbon Sports fascinates me in ways even I can't really completely understand. Nike's an athlete's way of nearly achieving invincibility. Throughout Nike's evolution, it has done things that are beyond abstract. Nike's advertising has always captivated me, particularly because of its versatility. Contrasting two Lance Armstrong commercials, one appeals on inspirational aspect, another aims to make you laugh.

The evolution of Nike from the late nineties' ways of targeting young basketball players to the 2007 way of targeting young basketball players really intrigues me. How is this segment different roughly 10 years later? Maybe more headbands and trash talk--however, how is the mindset different from the previous? How does Nike capture this? As far as I'm concerned, Nike is head and shoulders above the competition in terms of targeting young athletes and capturing their desires then ultimately channeling them onto a product to build a brand.

In my mind, Nike truly does it all. The ultimate definition of versatility, Nike always goes one step further in order to remain embedded in the consumer's mind. Brian Morrissey talks about how Nike allows its users to connect and share data through social networks in his "Why Nike Embraces Brand Utility" article. He talks about how Nike launched the "Ballers Network" on Facebook strictly for its young basketball addicts. Nike's goal is to "provide a useful service that enhances an athlete's enjoyment of his sport." To me, this goal corresponds with what Nike provides me on a mental, physical, and spiritual level.

The last question I would like to pose is how does this differ from, say, Adidas or Reebok? For the sake of argument, I will stick with Adidas because it does own Reebok.

Adidas appears to target a whole different segment. Interestingly enough, Adidas owns the license to make and distribute NBA products through a deal with the league about 2 years ago. Yet, I feel that when a young basketball player thinks Adidas, the associations that most often come to mind are soccer and "not cool" (just kidding... sort of). I own a pair of Adidas basketball shoes, and they are definitely not on par with my Nike basketball shoes. As a "baller" nowadays, Nike is your haven.

Adidas has inspirationally driven spots as well. Why do they not appeal on the same level as Nike's? I love Gilbert Arenas and his story, yet, his commercial would never make me go out there and buy his shoes. As a matter of fact, his shoes are far below appealing. Furthermore, this commercial is exemplary of Adidas basketball advertisements' unoriginality. It is the same concept as the Nike commercial from before (the second coming one under the "2007" link). However, it just does not appeal to me in nearly a similar fashion.

As time progresses, I hope to find more answers as to why Nike's able to capture pathos as well as why Adidas does just the opposite.

You and me, baby, ain't nothin' but mammals

Sex sells.

I've been hearing it since the days I first started speaking English. I see it on TV, read about it on (as Stephen always says) the World Wide Web, hear about it at school, and learn about it in class (sometimes). Sex appeal is what a large amount of companies shoot for nowadays. They want their products to resonate in a consumer's mind as sexy.

The problem is, sexy advertisement does not translate to sexy product. Now, I don't really know what's sexy nowadays. To me, sexy is a sleek pair of basketball shoes. Or a nice BMW 7-series. Or a really well mixed smoothie at Jamba Juice. As you can see, I've never been your typical consumer - THAT is why the topic of sex appeal... well, appeals so much to me.

Last class period, we watched L'Oreal ads. Then we watched a Dove spot. Dove is a product of Unilever, the same company responsible for Axe male grooming products. Axe, according to Wikipedia, has generated adverse publicity with accusations such as, but not limited to:

• Sexist and degrading advertising
• Being seen to encourage sexual promiscuity
• Targeting adverts at underage children

Axe's advertisements go something like this.

Kind of dumb, yeah? In my opinion, however, Axe had an overall pretty good campaign with their "Axe Effect" gimmick. It was cool, it was sexy. It almost made me want to start using it. It smelled good, it felt fresh (my friends used it so I tried it out a few times), and allegedly drew the ladies right in.

Axe did have some pretty solid commercials - they have probably aired hundreds by now. Regardless of the title of it on YouTube, I am particularly fond of this one. They've also created a website for their shenanigans: www.theaxeeffect.com

The phenomenon does not end there. There have been countless of "tasteless" (just sexually provocative or implicative) beer commercials. I cannot even begin to think about how many Miller or Bud Light commercials I have seen where there at the very least some sort of sexual innuendo. It doesn't end there... don't believe me? Take a look.

The question that most interests me about the topic is one of segmentation, a topic often discussed in Customer Insights. Who are these companies really looking to target? Is a 16 year-old girl going to buy an iPod because she saw a naked silhouette? Would a 36 year-old mother of two buy a vacuum that looks like one produced for a dominatrix? Men and women are very different when it comes to advertising. Men enjoy seeing healthy, young, good-looking women. Women on the other hand, are not exactly suckers for a muscular anatomy on their products' ads. A sexual connection is much more easier to make with males than with females.

Which drives my question - why sex? Women are a great demographic to target products towards, and although they do not usually have as much spending power, they often times are the primary decision maker when it comes to purchases. With raunchy, sexual-oriented advertisements, you not only alienate women, but at the same time fail to reach all, or even most of, the men. I would never buy a product because it had a hot girl in the commercial. Nike, Vitamin Water, Tropicana, Express, or Sony could put fat, bald, hairy 58 year-old men on their advertisements and I would still be attracted to their products. Beer isn't sexy. Coffee isn't sexy. Sexy isn't the ad, sexy is the product.

Axe smells good. But for how long? The ads were usually "sexy." Fine-lookin' scantily-clad women throwing themselves at the Axe-wearer seemed appealing. It was an appealing commercial (mostly, sometimes they just overdid it). But how was the product?

I never stuck with Axe... I'm more of a Burberry Cologne kind of guy.



I have yet to see one Burberry commercial in my life. Yet, I'm still prone to paying a premium for the product. Does sex really sell? You make the call.

Barry Schwartz. Mastermind author or Captain Obvious?

Schwartz's podcast discusses the paradox of choice. In a nutshell, when individuals are granted too many options, they often choose to do nothing at all. When something is done, the individual will end up regretting the decision that was made. Why? Because that indeed defines the paradox of choice.

Ultimately, a person's expectations will be too high in the midst of the (theoretically) thousands of options which they are given. This notion of variety is what makes our world what it is: a place driven by individuality but conflicted by the war with practicality and convenience.

The man stresses that more is less--a simple idea. Yet, we as consumers find ourselves longing for more options and more variation in the way we look, eat, sleep, and feel. This indeed is the paradox of choice which Schwartz speaks of. In a consumer's mind, it is wonderful to have a bajillion different types of toothbrushes, scents, appliances, etc. However, this can also cause headaches, frustration, laziness, and inevitable heartburn. In my opinion, it's not that people choose not to make (for the sake of the discussion) purchasing decisions because there are just way too many options. They just go with what they believe is to be the choice which best maximizes quality and minimizes the tedious tasks that are involved with getting the best product. These tasks include but are not limited to:

• research (whether it's online or a magazine, book)
• asking around (probably the most common)
• reading about all the benefits (whether it's on the product itself or again on the web)
• comparison of competitors (which in my mind, is the most imporant but also most tedious)

Since society has turned competition into the norm, there's always going to be a competitor for everything out there somewhere. Thus, the precedent for varied options is set. Consumers have a myriad of choices in the products or services they are able to purchase.

A human's decision-making process is quite intriguing. First off, more often that not, he or she will purchase something that is not needed. Regarldess, an apprehension arises from the moment the purchase is even considered leading up all the way until after the decision is made. "Did I buy the right product? How will it fit me? Will my friends think it's cool? Will it perform the tasks I want it to in the best possible manner?" All questions which the consumer will likely find him or herself wrestling with at one point or another. The apprehension subsequently leads to a form of cognitive dissonance. Schwartz talked about how an individual will begin blaming themselves if the expectations of the purchase are not met. The second-guessing has begun.

I, for example, have been trying to purchase a pair of Nike Hyperdunk basketball shoes for nearly two and a half months now. For the longest time (well, what seemed relatively long at the time.. turned out to be only about a week or two) I could not decide which color I wanted the shoes in. Footlocker.com has 13 different colorways alone after getting rid of the white and blue ones (which at the time were a possibility).



The biggest problem of all was finding my size. These "kicks" are a hot commodity among "ballers" of all ages and word on the street is they are some of the most comfortable and performance-driven basketball shoes on the market. Kobe Bryant wore them for a span of two seasons, and many other NBA players wear them as well.

Still, the dilemma consisted of which size I needed, what color I would purchase, and where I would make my purchase. But as Schwartz suggested, since I have an unlimited amount of options, I have yet to choose one...