Three Marketing Giants Adjust To The New post-crash Reality
Never let it be said that America cannot adapt to changing circumstance
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After 18 months of recession (and three months of growth purchased wholly with borrowed and invented money), and with official unemployment slated to remain at roughly 10% for the foreseeable future (and unofficial unemployment somewhere closer to 20%), three iconic marketing giants have stepped up to the plate, squinted steely-eyed at the pitcher, and swung for the fences.
The first batter in the box (and yes, I was up waaaay too late last night watching the Yankees drub the Phillies in the last game of the World Series) is Dallas-based 7-Eleven Inc.
Senior merchandising and logistics VP Kevin Elliott figures that the consumer is really pinched as far as discretionary income. Hes been seeing a lot of success with products that really resonate on a value basis, like the store-branded 7-Select beef jerky line the chain introduced last year.
Your Most Basic Post-Crash Needs
So now 7-Eleven is launching a new wine label: Yosemite Road. It will start off by offering a chardonnay (described as zesty, with notes of apricot, peach and honey), and a cabernet (full bodied with juicy plum overtones). Both are slated to sell for $3.99 a bottle.
7-Eleven is placing this new-age plonk in some 15,000 stores in the U.S. and Japan. Market researcher IRIs president, Thom Blischok, lauds the move as fulfilling your most basic needs.
The ads might read: When you want one for the road think Yosemite Road.
Folks, I couldnt make this stuff up if I tried. (Okay, I made up that ad. But the rest? Pure unadulterated reality.)
Moving on
Shes All Grown Up and on Her Own
The next icon to step up is Mattel (MAT:NasdaqGS), maker of American Girl dolls. If you do not have daughters, nieces or granddaughters, then perhaps you have been spared the onslaught. The rest of you already know all too much about these foot-tall $100 collectible mannequins, replete with detailed backstories and historical clothing.
The latest girl to join the fold is Gwen. Much like the rest of the line, Gwen can be purchased for $175 with a friend, some clothes and a couple of storybooks, or for $95 on her own.
And much like the rest of the line, Gwen has a unique biography: She is homeless, and she sleeps in the back seat of her parents car.
The company has attempted to assuage the inevitable social activist outrage (its kind of like road rage, but mostly only happens at PTA meetings in San Francisco and Manhattans Lower East Side) by noting that at least they are raising awareness of homelessness in otherwise clueless rich children.
A $12.1 Trillion-Dollar Home Run
Finally, our third player is the greatest marketer ever, or even ever imagined. I am speaking, of course, of the U.S. Treasury.
Just how much American debt is the Treasury flogging these days? We are told in a recent (and very quietly released) statement that the department will auction off a record $81 billion in notes and bonds next week.
The offerings are slated to refund $38.5 billion in maturing securities and raise approximately $42.5 billion in new cash. Broken down, we are looking at some $40 billion in three-year notes, (up from $37 billion at the previous refunding), $25 billion in 10-year notes ($2 billion more than last Augusts round), and $16 billion in 30-year bonds (up from $15 billion).
MIA: 20-Year TIPS and Congress
The one product that you dont see in the mix is the 20-year TIP bond. The Treasury has decided to stop offering these long-dated inflation-indexed notes. It claims that buyers just arent interested in protecting themselves in this fashion.
After all, there is no inflation, right? So it couldnt possibly be the threat of having to pay off these bonds at God only knows what rate some 20 years out. (I will now give you a moment to mop up that coffee you just blew out your nose.)
But thats just this weeks offerings. The Treasury has been so busy attempting to borrow enough cash to fund Washingtons grandiose spending binge, it will slam up against the Congressionally mandated debt ceiling of $12.1 trillion sometime within the next four to six weeks.
The Treasury has already asked Congress to raise that ceiling by another $1 trillion. However, the Office of Management and Budget has suggested that the Treasury may soon be returning to the well, because $3.5 trillion is a far more realistic figure for the additional cumulative deficit we are compounding.
Several senators have responded to the Treasurys request somewhat stiffly, claiming that they could only vote for such a thing if Congress also empanelled a commission to address future budgets without requiring senators or representatives to actually show up or vote. Heck, the president wouldnt even have to lift a pen to sign them!
Now thats stepping up!
Link to original article: http://www.taipanpublishinggroup.com/taipan-daily-110609.html
by: A. Lass
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