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Why Most Promotions Lose Money
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- The Great Cola War Goes Global
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Why Most Promotions Lose MoneyTo evaluate trade promotions, we have developed computer programs that measure the marginal productivity of promotional events.1. Anywhere from 30% to 90% of the time, a consumer product is not on promotion in a particular store. Using sales data from individual stores, the programs compare sales from these nonpromotion weeks with those from promotion weeks. Algorithms then project what the sales of the product would have been during the promotion week if the promotion had not taken place. This provides a baseline against which we can measure the incremental impact of the promotion. The only possible bias is that our programs may overestimate the incremental sales of a particular event since promotions tend to accelerate purchases by consumers. Thus we may mistakenly count purchases borrowed from a later period’s normal sales as incremental sales caused by the promotion. At first glance, our finding that only 16% of the promotions studied were profitable may seem surprising. But when you consider the economics underlying promotions, it is easy to see why. Consider the hypothetical example of a brand with very good support from retailers (see the exhibit “The Unprofitable Economics of Trade Promotions”). The brand promotes to the trade at a 15% price discount over a four-week period. Assume that all the stores in the market feature the brand for one week in their weekly newspaper advertising supplement. What’s more, half the stores support the brand with three weeks of in-store display and consumer price reductions, while the other half only reduce the price but for the full four weeks. These are excellent trade-support statistics that would be hard to achieve in reality. 16 Theme: The Cola wars go global Model of teaching technology of the lesson
The Great Cola War Goes GlobalBy Nell Henderson August 23, 1985 The Great Cola War escalated into a global conflict this week as PepsiCo Inc., slyly tooting its arch-rival's horn, introduced New Coke overseas. The company invited reporters from Singapore to Paris to taste-test the new beverage as proof of Pepsi's superiority. Meanwhile, PepsiCo was busy at home combating Coca-Cola's newest propaganda offensive -- the suggestion that Pepsi may be testing a reformulated version of its flagship flavor called "New Pepsi." A Pepsi spokesman said yesterday that there is "absolutely no truth" to such rumors, but the exchange reflected the spirited and increasingly mischievous nature of one of America's hottest consumer rivalries. Marketing analysts say Pepsi, full of fizz and vinegar, seems to enjoy the battle more. When Coke swallowed its pride, for instance, and brought back its original flavor as Coca-Cola Classic on July 10, Pepsi let the world know it was giving its employes a holiday. And Roger Enrico, president of Pepsi-Cola USA, offered the media the quote of the day: "How do you advertise it -- Coke Are It?" "Pepsi has been very successful in establishing an image for itself as a go-go company," said Emanuel Goldman, a soft-drink industry analyst with Montgomery Securities. "Its advertising response has been really innovative. . . . Pepsi's image is that of a very dynamic company." "Cola wars are a fun thing," said Ken Ross, a Pepsi-Cola USA spokesman. The 87-year-old competition between the two titans that dominate worldwide soft-drink sales -- estimated to be a $50 billion market -- took a new turn on April 23 when Coca-Cola announced it had changed the 99-year-old taste of Coke. The less-carbonated, sweeter taste was immediately likened by many analysts to that of Pepsi, which had beaten Coke for years in blind taste tests, even though Coke outsells Pepsi. That day marked "the irrevocable turning point of the Cola Wars in Pepsi's favor," said Pepsi-Cola International President Robert Beeby this week in a videotaped message beamed to news conferences in 16 foreign cities. Beeby reminded the overseas reporters that Coca-Cola had described the reformulation as "the surest move ever made. "We heartily welcome the opportunity around the world to match the single preferred taste of Pepsi-Cola -- the taste too good to change -- against the split personality of Coca-Cola, or whichever single product they choose to market," Beeby said as Pepsi's guests sipped New Coke. "In light of the competition's recent activity, Pepsi-Cola has clearly become the gold standard by which all colas will forever be measured." Coca-Cola, however, outsells Pepsi overseas by about 3.5 to 1, Goldman said. At home, Coke has a 24.5 percent share of the $23 billion-a-year U.S. soft-drink market, compared with Pepsi's 18.5 percent. Coca-Cola Co.'s soft-drink products, which include Tab, Sprite, Diet Coke and Fanta flavors, together hold a 39.4 percent share of the domestic market; PepsiCo's soft drinks, including Diet Pepsi, Pepsi-Lite, Slice and Mountain Dew, together hold 26.9 percent. Pepsi "is very good at playing the game. But after 87 years of playing follow the leader, you ought to be pretty good," Coca-Cola Assistant Vice President Charlton Curtis said. Coca-Cola is not above having fun, too. Coca-Cola "just thought it was a little interesting" when it found a soft drink in Japan labeled "New Pepsi," Curtis said. Coca-Cola supplied a photo of the Japanese beverage can to American news agencies and said it contradicted Pepsi's claim that its flavor is "too good to change." PepsiCo said "New Pepsi" is a lemon-flavored cola introduced in 1982 in one area of Japan. "New Pepsi" is still sold there, but PepsiCo has no plans to sell it elsewhere, or to reformulate Pepsi's flavor, Ross said. "There are absolutely no plans to bring out a New Pepsi in the U.S.," he said. PepsiCo has no reason to change the taste of Pepsi because Pepsi has shown it can beat Coca-Cola Classic's flavor and is already similar to New Coke, Goldman said. Pepsi has come a long way since 1939, when it took a subtle swipe at Coca-Cola with the first 15-second radio jingle. A 6 1/2-oz. bottle of Coke then sold for 5 cents, so Pepsi advertised: "Pepsi-Cola hits the spot; Twelve full ounces, that's a lot; Twice as much for a nickel, too; Pepsi-Cola is the drink for you." In 1950, Coke outsold Pepsi by 5 to 1. Brand Coke's lead was cut in half by 1960 and is now estimated to be about 1.15 to 1. But while advertising jingles and campaigns are memorable, analysts attribute Pepsi's growth to the development of a superb marketing and distribution network. The soft-drink industry is intensely consumer-driven, and all soft-drink companies have raced to develop new products, new packaging options and new distribution networks. PepsiCo and Coca-Cola are now the two superpowers, having both increased their market shares at the expense of Royal Crown, 7-Up, Dr Pepper and others. Although Pepsi's consistent victories in the "Pepsi Challenge" taste tests were "always a thorn in the side" to Coca-Cola, brand Pepsi has not gained on brand Coke in more than a decade. In 1973, Pepsi's and Coke's shares of the domestic market were less than 2 percentage points different than they are today, Goldman said. Yet both soft-drink companies have increased their market shares through introducing new beverages. Pepsi's big victory was breaking away from the pack to become Coke's major competitor, a status it is enjoying. "Pepsi was always the underdog, so it had to be aggressive and persistent," said Samuel Craig, a professor of marketing at New York University's Graduate School of Business Administration. "Pepsi's is the classic catch-up strategy." The cola wars are a series of mutually-targeted television advertisements and marketing campaigns since the 1980s between two long-time rival soft drink producers, The Coca-Cola Company and PepsiCo. The battle between the two dominant brands in the United States intensified to such an extent that the term “Cola wars” was used to describe the feud. Each employed numerous advertising and marketing campaigns to outdo the other. Short periods of intense competition between the two firms contrast with how the two firms avoid competition most of the time by focusing on different consumers, sponsoring different sports, differentiating their logos, choosing different colors for their packaging, and building different images for their brand.[1] In periods of intense competition, one firm, most of the time Pepsi,[citation needed] challenges the other by asserting superiority on one specific aspect of their products. This leads to direct competition and changes in market shares or in prices. For example, Pepsi marketed bigger bottles for the same price as Coca-Cola during the Great Depression in the 1930s.[1] The memory of such periods of frontal competition may help both firms maintain the more profitable status quo. Both firms generally prefer not to compete on real product differences, such as price or taste, because this offers only short-term opportunities for additional profit 17 Theme: NGO (non- Government Organization) Model of teaching technology of the lesson
Non-governmental organization
H.E. Pekka Haavisto, Minister for International Development of the Ministry for Foreign Affairs in Finland at the first World NGO Day, Helsinki, Finland in 2014 Non-governmental organizations, nongovernmental organizations, or nongovernment organizations, commonly referred to as NGOs, are usually non-profit and sometimes international organizations independent of governments and international governmental organizations (though often funded by governments) that are active in humanitarian, educational, health care, public policy, social, human rights, environmental, and other areas to affect changes according to their objectives. They are thus a subgroup of all organizations founded by citizens, which include clubs and other associations that provide services, benefits, and premises only to members. Sometimes the term is used as a synonym of "civil society organization" to refer to any association founded by citizens,[11] but this is not how the term is normally used in the media or everyday language, as recorded by major dictionaries. The explanation of the term by NGO.org (the non-governmental organizations associated with the United Nations) is ambivalent. It first says an NGO is any non-profit, voluntary citizens' group which is organized on a local, national or international level, but then goes on to restrict the meaning in the sense used by most English speakers and the media: Task-oriented and driven by people with a common interest, NGOs perform a variety of service and humanitarian functions, bring citizen concerns to Governments, advocate and monitor policies and encourage political participation through provision of information. NGOs are usually funded by donations, but some avoid formal funding altogether and are run primarily by volunteers. NGOs are highly diverse groups of organizations engaged in a wide range of activities, and take different forms in different parts of the world. Some may have charitable status, while others may be registered for tax exemption based on recognition of social purposes. Others may be fronts for political, religious, or other interests. Since the end of World War II, NGOs have had an increasing role in international development, particularly in the fields of humanitarian assistance and poverty alleviation. The number of NGOs worldwide is estimated to be 10 million. Russia had about 277,000 NGOs in 2008. India is estimated to have had around 2 million NGOs in 2009, just over one NGO per 600 Indians, and many times the number of primary schools and primary health centres in India. China is estimated to have approximately 440,000 officially registered NGOs. About 1.5 million domestic and foreign NGOs operated in the United States in 2017. The term 'NGO' is not always used consistently. In some countries the term NGO is applied to an organization that in another country would be called an NPO (non-profit organization), and vice versa. Political parties and trade unions are considered NGOs only in some countries. There are many different classifications of NGO in use. The most common focus is on "orientation" and "level of operation". An NGO's orientation refers to the type of activities it takes on. These activities might include human rights, environmental, improving health, or development work. An NGO's level of operation indicates the scale at which an organization works, such as local, regional, national, or international. The term "non-governmental organization" was first coined in 1945, when the United Nations (UN) was created. The UN, itself an intergovernmental organization, made it possible for certain approved specialized international non-state agencies — i.e., non-governmental organizations — to be awarded observer status at its assemblies and some of its meetings. Later the term became used more widely. Today, according to the UN, any kind of private organization that is independent from government control can be termed an "NGO", provided it is not-for-profit, non-prevention, but not simply an opposition political party. One characteristic these diverse organizations share is that their non-profit status means they are not hindered by short-term financial objectives. Accordingly, they are able to devote themselves to issues which occur across longer time horizons, such as climate change, malaria prevention, or a global ban on landmines. Public surveys reveal that NGOs often enjoy a high degree of public trust, which can make them a useful - but not always sufficient - proxy for the concerns of society and stakeholders. Types NGO/GRO (governmental-related organizations) types can be understood by their orientation and level of how they operate. By orientation Charitable orientation often involves a top-down effort with little participation or input by beneficiaries. It includes NGOs with activities directed toward meeting the needs of the disadvantaged people groups. Service orientation includes NGOs with activities such as the provision of health, family planning or education services in which the programme is designed by the NGO and people are expected to participate in its implementation and in receiving the service. Participatory orientation is characterized by self-help projects where local people are involved particularly in the implementation of a project by contributing cash, tools, land, materials, labour etc. In the classical community development project, participation begins with the need definition and continues into the planning and implementation stages. Empowering orientation aims to help poor people develop a clearer understanding of the social, political and economic factors affecting their lives, and to strengthen their awareness of their own potential power to control their lives. There is maximum involvement of the beneficiaries with NGOs acting as facilitators. By level of operation Community-based organizations (CBOs) arise out of people's own initiatives. They can be responsible for raising the consciousness of the urban poor, helping them to understand their rights in accessing needed services, and providing such services. City-wide organizations include organizations such as chambers of commerce and industry, coalitions of business, ethnic or educational groups, and associations of community organizations. State NGOs include state-level organizations, associations and groups. Some state NGOs also work under the guidance of National and International NGOs. National NGOs include national organizations such as the YMCAs/YWCAs, Bachpan Bachao Andolan, professional associations and similar groups. Some have state and city branches and assist local NGOs. International NGOs range from secular agencies such as Save the Children, SOS Children's Villages, OXFAM, Ford Foundation, Global march against child labor, and Rockefeller Foundation to religiously motivated groups. They can be responsible for funding local NGOs, institutions and projects and implementing projects. Apart from "NGO", there are alternative or overlapping terms in use, including: third-sector organization (TSO), non-profit organization (NPO), voluntary organization (VO), civil society organization (CSO), grassroots organization (GO), social movement organization (SMO), private voluntary organization (PVO), self-help organization (SHO) and non-state actors (NSAs). In Portuguese, Spanish, French, Italian and other Romance languages, the 'mirrored' abbreviation "ONG" is in use, which has the same meaning as "NGO" (for example Organisation non-gouvernementale in French, Organização Não Governamental in Portuguese, Organización no gubernamental in Spanish, or Organizzazione non governativa in Italian). Governmental-related organizations / non-governmental organizations are a heterogeneous group. As a result, a long list of additional acronyms has developed, including:
BINGO: 'Business-friendly international NGO' or 'Big international NGO' SBO: 'Social Benefit Organization,' a positive, goal-oriented designation as a substitute for the negative, "Non-" designations TANGO: 'Technical assistance NGO' TSO: 'Third-sector organization' GONGO: 'government-organized non-governmental organization' or 'government-operated NGOs' (set up by governments to look like NGOs in order to qualify for outside aid or promote the interests of government) DONGO: 'Donor-organized NGO' INGO: 'International NGO' QUANGO: 'Quasi-autonomous NGO,' or QUANGO refer to NGOs set up and funded by government. The term is particularly prevalent within the UK (where there are more than 1,200 of them), the Republic of Ireland, and the Commonwealth. National NGO: A non-governmental organization that exists only in one country. This term is rare due to the globalization of non-governmental organizations, which causes an NGO to exist in more than one country. CSO: 'Civil Society Organization' ENGO: 'Environmental NGO,' such as Greenpeace and WWF NNGO: 'Northern NGO' Sparsh NGO: 'Sparsh NGO,' such as Non-Governmental Organization PANGO: 'Party NGO,' set up by parties and disguised as NGOs to serve their political matters. SNGO: 'Southern NGO' SCO: 'Social change organization' TNGO: 'Transnational NGO.' The term emerged during the 1970s due to the increase of environmental and economic issues in the global community. TNGO includes non-governmental organizations that are not confined to only one country, but exist in two or more countries. GSO: Grassroots Support Organization MANGO: 'Market advocacy NGO' NGDO: 'Non-governmental development organization' PVDO: 'Private voluntary development organisation' USAID refers to NGOs as private voluntary organizations. However, many scholars have argued that this definition is highly problematic as many NGOs are in fact state- or corporate-funded and -managed projects and have professional staff. GRO/NGOs exist for a variety of reasons, usually to further the political or social goals of their members or founders. Examples include improving the state of the natural environment, encouraging the observance of human rights, improving the welfare of the disadvantaged, or representing a corporate agenda. However, there are a huge number of such organizations and their goals cover a broad range of political and philosophical positions. This can also easily be applied to private schools and athletic organizations. Track II diplomacy Main article: Track II diplomacy Track II dialogue, or Track II diplomacy, is transnational coordination that involves non-official members of the government including epistemic communities as well as former policy-makers or analysts. Track II diplomacy aims to get policymakers and policy analysts to come to a common solution through discussions by unofficial means. Unlike the Track I diplomacy where government officials, diplomats and elected leaders gather to talk about certain issues, Track II diplomacy consists of experts, scientists, professors and other figures that are not involved in government affairs. The members of Track II diplomacy usually have more freedom to exchange ideas and come up with compromises on their own. Activities There are numerous classifications of NGOs. The typology the World Bank uses divides them into Operational and Advocacy. Generally, NGOs act as implementers, catalysts, and partners. Firstly, NGOs act as implementers in that they mobilize resources in order to provide goods and services to people who are suffering due to a man-made disaster or a natural disaster. Secondly, NGOs act as catalysts in that they drive change. They have the ability to 'inspire, facilitate, or contribute to improved thinking and action to promote change'. Lastly, NGOs often act as partners alongside other organizations in order to tackle problems and address human needs more effectively. NGOs vary in their methods. Some act primarily as lobbyists, while others primarily conduct programs and activities. For instance, an NGO such as Oxfam, concerned with poverty alleviation, may provide needy people with the equipment and skills to find food and clean drinking water, whereas an NGO like the FFDA helps through investigation and documentation of human rights violations and provides legal assistance to victims of human rights abuses. Others, such as the Afghanistan Information Management Services, provide specialized technical products and services to support development activities implemented on the ground by other organizations. Operational Operational NGOs seek to "achieve small-scale change directly through projects". They mobilize financial resources, materials, and volunteers to create localized programs. They hold large-scale fundraising events and may apply to governments and organizations for grants or contracts to raise money for projects. They often operate in a hierarchical structure; a main headquarters being staffed by professionals who plan projects, create budgets, keep accounts, and report and communicate with operational fieldworkers who work directly on projects. Operational NGOs deal with a wide range of issues, but are most often associated with the delivery of services or environmental issues, emergency relief, and public welfare. Operational NGOs can be further categorized by the division into relief-oriented versus development-oriented organizations; according to whether they stress service delivery or participation; whether they are religious or secular; and whether they are more public- or private-oriented. Although operational NGOs can be community-based, many are national or international. The defining activity of operational NGOs is the implementation of projects. Campaigning Campaigning NGOs seek to "achieve large-scale change promoted indirectly through influence of the political system". Campaigning NGOs need an efficient and effective group of professional members who are able to keep supporters informed, and motivated. They must plan and host demonstrations and events that will keep their cause in the media. They must maintain a large informed network of supporters who can be mobilized for events to garner media attention and influence policy changes. The defining activity of campaigning NGOs is holding demonstrations.[25] Campaigning NGOs often deal with issues relating to human rights, women's rights, and children's rights. The primary purpose of an Advocacy NGO is to defend or promote a specific cause. As opposed to operational project management, these organizations typically try to raise awareness, acceptance and knowledge by lobbying, press work and activist event. Both operational and campaigning It is not uncommon for NGOs to make use of both activities. Many times, operational NGOs will use campaigning techniques if they continually face the same issues in the field that could be remedied through policy changes. At the same time, Campaigning NGOs, like human rights organizations often have programs that assist the individual victims they are trying to help through their advocacy work. Public relations Non-governmental organizations need healthy relationships with the public to meet their goals. Foundations and charities use sophisticated public relations campaigns to raise funds and employ standard lobbying techniques with governments. Interest groups may be of political importance because of their ability to influence social and political outcomes. A code of ethics was established in 2002 by The World Association of Non Governmental Organizations. Project management There is an increasing awareness that management techniques are crucial to project success in non-governmental organizations. Generally, non-governmental organizations that are private have either a community or environmental focus. They address varieties of issues such as religion, emergency aid, or humanitarian affairs. They mobilize public support and voluntary contributions for aid; they often have strong links with community groups in developing countries, and they often work in areas where government-to-government aid is not possible. NGOs are accepted as a part of the international relations landscape, and while they influence national and multilateral policy-making, increasingly they are more directly involved in local action. 18 Theme: Uzbekistan teachers of English Association (UzTEA) Model of teaching technology of the lesson
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