Most of our clients know of our unhealthy fascination (in both the figurative and literal sense) with all things Mike & Ike. They are our constant companions at critical meetings. They nourish us during late nights flights to remote locations…and give us needed energy for those early morning sessions.
We have Mike & Ike mouse pads and water bottles. We have visited their flagship store in Washington DC and have had a personal, behind-the-scenes tour of the privately held Just Born office and factory in Bethlehem, PA.
To say that we are obsessed with these wonderfully flavorful & powerful pills would be an understatement.
So it goes without saying that we were devastated to learn of their recent split:
This is big news that will likely have ripple effects throughout the nation and the world. Celebrities are talking about it, both Mike and Ike are blogging about it and no one really knows how this one is going to end up.
Yes, we realize it’s just an advertising campaign. But it still strikes at the core of everything we care about at Clarity Group. Okay, maybe not everything we care about at Clarity Group – but certainly the most important aspect of our fascination with the non-chocolate chewy candy category.
As we remove ourselves from the emotional distress of the situation, there are some interesting business lessons that come from recent announcement.
- To compete in today’s world, you have to “think big.” Just Born is hoping to double Mike & Ike sales in two years, from $31 MM in revenue to over $62 MM. That’s aggressive by any standard. They have set a measurable objective and built a plan to achieve it. Kudos. (Side note: In support, Clarity Group has increased our candy budget from $75.00 per year to $127.50 to help do our part!).
- When you think big, you have to be prepared to GO BIG. The company has increased their advertising spend from $125K in 2011 to $15MM in 2012. Yep, you read that right. That’s an 11,900% increase year over year. Dude, that is a serious increase. When is the last time you did something with an 11,900% increase?!?! If everyone gave that much of an effort in everything they did personally and professionally, the world would be a different place. And Mike and Ike would likely still be together.
- When you think big and go big, you better be broad and consistent in your messaging. Both Mike and Ike have hit the airwaves with their messages. They are blogging, Facebooking and everything in between. And the message is NOT about the candy, but about the status of their relationship and their (diverging) interests. This is the kind of stuff teenagers (and their Facebook friends) love. So at least at launch, the message is broad and consistent.
- Be creative and have fun. I realize that not everyone can launch a yearlong campaign that creates a soap opera-like melodrama of fun and frivolity…but heck, if you can, go for it! We believe that life is too short to be too serious and there’s nothing less serious than an artificially fruit flavored piece of gelatin molded in the shape of a pill. It’s great to see someone have fun with their brand and we applaud the effort.
Of course, in any messy divorce, there is “the other side of the coin.” In the spirit of seeing both angles, here are some cautionary tales from Mike and Ike’s wild adventure.
- Make sure you don’t go TOO big. We just lauded Just Born for their aggressive increase in advertising spend. But was such an investment necessary? This is a brand with $31.1MM in revenue that grew by 2.2% with $125K in ad support over the past year. Given these metrics, this campaign had better drive revenues closer to $3.7 BILLION in order to justify the spend and keep their revenue:marketing ratio in line. They are spending half the revenue of a mature brand on a re-launch. At the very least, they should expect to drive sales to $150MM (five times growth, not double the growth as hoped) to produce a modest 10% return on investment in advertising/marketing. Plainly stated, they likely could double the sales of Mike and Ike without having to spend $15MM to do so.
- Know your audience and be careful with your voice. I give credit to Just Born for their broad and consistent messaging. But I share the concern of the author of the NY Times article when he questions whether the ads sound “like a hip youngster, or a marketer in a swivel chair impersonating one.” They are targeting 13-17 kids – so they better make sure the voice resonates with them. I find this stuff hysterical but I am 30 years removed from their target criteria. Will the voice work…and will it make teens buy more candy? Time will tell.
- Don’t forget to focus on relationships. I realize it’s only candy. And most candy-based relationships start and stop around February 14. Still, the one thing missing from this campaign is any tangible effort to build a sustainable relationship with the consumers. Draw them into the dialogue. Get them engaged. Sure, witty videos and Facebook posts will start the dialogue. And maybe the blog will create some comments. But how does Just Born turn a traditional advertising campaign into a relationship-building vehicle? And is it possible to build loyal brand advocates over a sugary treat? Our small Clarity Group sample would indicate yes but again, we are not the target market.
Sadly, I am guessing that Mike and Ike are too busy focusing on their OWN relationship to be worried about a relationship with their consumers. However, I am certain that their Board of Directors has $15MM reasons why they are more concerned with the latter.