Social media – the highs and lows
We’re a real fan of Mark Ritson’s article each week in Marketing Week. Having caught up on our reading, we thought we’d share with you his observations on the pepsi’s social media campaign – showing that whilst social media is great for conversations with customers, at the end of the day, don’t forget the product you’re marketing. Here’s an extract from the article we hope you enjoy -
Last year Pepsi shocked American marketers by announcing a major change to its brand strategy. After ten years of investment in TV ads, they shifted as much as 50% into social media to create a ‘movement’ rather than a moment. Called the Refresh project, they used facebook, twitter, live upstream video and an iPhone application. Customers were encouraged to suggest social causes to refresh the world, then consumers could vote through social media on their favourite causes and Pepsi would donate millions.
Any traditional advertising Pepsi did promoted the social media campaign. The response was spectacular, 80m votes registered, 60,000 followers on twitter, 4 million likes on Facebook.
But, there was one snag. For all the big social media numbers, Pepsi’s sales started to slide. And Coke’s didn’t. In Feb 2011, Wall Street Journal reported that both Pepsi and Diet Pepsi had each lost about 5% of their market share over the past 12 months in the US (about half a billion dollars worth of sales). Also for the first time in living memory, it also lost its number two spot. Diet Coke is now the second biggest cola brand in the US.
An overt focus on social media had blinded Pepsi to the realities of its market. It was not marketing a movement, it was marketing cola.
Senior Pepsi people admitted to the failings of social media and their vice-president of marketing told an audience “the key learning for us was that in addition to having a cultural idea that taps into mass sensibility, you need to make sure that your idea is getting enough exposure to be successful.” Editor of Beverage Digest said “Pepsi needs more product orientated advertising and marketing.”
Pepsi has now reversed course and pumped money back into traditional media with a $60m sponsorship deal of the American version of The X-Factor.
As Mark Ritson says at the end of his article, social media adds an interesting new set of tools to traditional media, but it is clearly not the end of it. (Marketing Week, 7 March 2011)
Mark – we love your articles – keep them coming!
