Philips Lighting B2C, B2B
“Star” Product and Advertising Creativity Fuel Growth, Portfolio Sales Up ⇧ 91% YOY
Background For decades General Electric (GE) dominated the U.S. lighting category –- with high levels of unaided awareness and strong brand equities –- with such love from consumers that it easily charged more than competitors for lesser (shorter life) bulbs and in the U.S. had close to 50% market share.
Despite a variety of strengths in the EMEA, LATAM and APAC regions, in North America Philips ranked a distant third to GE and Osram/Sylvania, with lower awareness, weaker brand equity, flat sales and lower market share.
Yet Philips had an innovative new product which showed promise: a compact fluorescent light (CFL) bulb which was as bright as typical incandescent bulbs — but could last up to five years — called the Marathon. But it was more expensive and emitted a cooler (blue-ish) shade of white compared to warm incandescent bulbs.
Philips’ product managers were under pressure to grow the brand and sales within a mature, low-involvement category, in which most customers were price-sensitive.
Philips LED Daylight Bulbs
My Role I was strategic lead responsible for supervising and coaching my direct reports and junior colleagues, supporting and leading our large cross-functional team, guiding research development and performing analysis, developing insight and campaign strategy, and nurturing and supervising campaign development, production, implementation, measurement, reporting and optimization across retail and consumer channels.
Research, Analysis & Insight To better understand Philips’ challenges, we analyzed the category, competitors, customers and the Company, including its products, services, performance, key personnel and brands.
Then we dug deeper, taking a classic Segmentation / Targeting / Positioning (STP) approach: Segmentation to divide the market into distinct customer groups based on demographics, psychographics and behaviors, allowing for a more accurate and thorough understanding of customer needs, perceptions and motivations; Targeting to select the most attractive segment(s) on which to focus; and Positioning to confirm the ideal product classification and craft a value proposition to maximize relevance, distinction and attraction.
Segmentation Our research showed two segments which tended to buy GE, who on average were older, 35-64, less energy conscious and slower to try new technology. And it revealed two segments which offered real opportunity for Philips: men and women, 25-44, couples and young families with kids at home, who were younger and skewed female. They were eco-conscious, enjoyed trying new tech (were “early adopters”) and, with kids at home, were interested in products which made home maintenance easier and more convenient.
Targeting We targeted these younger segments who were in the market for home maintenance and repair: who purchased lighting regularly, were open to new brands (switching when a product offered functional advantages), and were interested in “smart” / eco-friendly products which delivered energy, time and cost savings.
Positioning The Marathon compact fluorescent light (CFL) bulb offered several benefits, including:
Used 75% less electricity
Could last up to five years
Its long life meant greater ease / convenience (less inconvenience / hassle of replacement, especially in tough-to-reach places like garages, basements, hgh ceilings, ceiling fans, etc.)
This lead us to position the Marathon simply, as a high-performing, money-saving smart alternative to standard bulbs:
“The light bulb that lasts up to 5 years.”
Development, Production & Implementation Based on our research findings and insight, I lead the development, production and implementation of our campaign strategy.
I briefed two of our creative teams, who developed a variety of concepts for an integrated campaign. We copy-tested three to determine the strongest based on measures including message clarity, emotional impact, persuasion, recall and brand perception.
The strongest concept dramatized the lifespan, value, and convenience of the Marathon bulb, touting convenience and saving time and money. The aspirational message? Smart people use the Marathon.
Key elements of the integrated campaign included:
Video commercials - “College” in which, on move-in-to-dorm day, during announcer voice-over, a dad installs a Marathon bulb in his son’s room. A series of events take place over a kind of time-lapse, (studying, a girlfriend, football parties etc.) When the son graduates in cap and gown, the college grad unscrews the bulb and takes it with him.
In “Cabin”, we see a man hiking to a friends’ remote cabin in the mountains. Through announcer voice-over we learn he’s going there to write his next novel. Upon entering he sees the answering machine blinking and plays the message: his friend (the cabin owner) welcomes him to the cabin and describes the places inside the cabin where “years of supplies” are located. While the voicemail plays we see the man looking for and finding canned food, toilet paper, cured meat etc. in closets, cabinets and the basement - years worth of supplies … and last but not least, he looks in a drawer and pulls out a a single light bulb, the Marathon
Audio and display - which conveyed similar key messages and reinforced the long-life promise in high-frequency media
Retail trade - to maintain and grow distribution and shelf-space with large regional and national retailers — including slide decks and in-store support at Walgreens and Target
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Measurement, Reporting & Optimization The campaign delivered measurable impact across brand and business metrics including:
Brand tracking study research showed Philips association with “long life” grew from 38% to 50%, one of our goals
Total lighting sales increased 108% during the campaign period, and remained 91% above baseline (pre-campaign levels) one month after the campaign ended
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National distribution expanded, with Walgreens and Target citing the integrated campaign as a key reason they began carrying Philips lighting products nationwide
Beyond the numbers, the creative earned industry praise: Adweek named the “College” commercial a “Best of the Week”
Our work was emotional, smart, and slightly cheeky — positioning Philips as the intelligent choice in a highly commodified category.
Agency Arnold Worldwide