PART 1D-1: 3M’s Post-it Flag Highlighter: Extending the Concept!

D-2: Daktronics, Inc.: Global Displays in 68 Billion Colors

D-3: Jamba Juice: Scanning the Marketing Environment

D-4: BP’s Deepwater Horizon: Ethics and Environmental Effects

PART 2D-5: The Jamisons Buy an Espresso Machine

D-6: Motetronix Technology: Marketing Smart Dust

D-7: Callaway Golf: The Global Challenge

PART 3 D-8: HOM Furniture: Where Keen Observation Pays

D-9: Lawn Mowers: Segmentation Challenges

PART 4 D-10: Medtronic in China: Where “Simpler” Serves Patients Better

D-11: Pampered Pooches Travel in Style

D-12: Philadelphia Phillies, Inc.: Sports Marketing 101

D-13: Health Cruises, Inc.: Estimating Cost, Volume, and Profit Relationships

D-14: Glitzz: Devising a Pricing Strategy

D-15: Shiseido: Channeling Cosmetics in China

D-16: Trader Joe’s: Upscale Value

D-17: Banyan Tree Holdings: Creating a Brand with IMC

D-18: Target Corporation: Award-Winning Advertising

D-19: AOI Marketing: Using Facebook to Launch Bitter Girls

D-20: Morgantown Furniture: Making Promotion Trade-Offs

PART 5 D-21: Crate and Barrel: Multichannel Marketing

D-22: Naked® Juice: Strategy for Growth

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“I didn’t go out to students and ask, ‘What are your needs, or what are your wants?’” 3M inventor David Windorski explains to a class of college students. “And even if I did ask, they probably wouldn’t say, ‘Put flags inside a highlighter.’ ” So Windorski turned the classic textbook approach to marketing on its head. That classic approach—as you saw earlier in Chapter 1— says to start with needs and wants of potential customers and then develop the product. But sometimes new- product development runs in the opposite direction: Start with a new product idea—such as personal computers—and then see if there is a market. This is really what Win-dorski did, using a lot of marketing research along the way after he developed the concept of the Post-it® Flag Highlighter.

EARLY MARKETING RESEARCH

During this new-product development process, Windorski and 3M did a lot of marketing research on students. For example, students were asked to dump the contents of their backpacks on the table and to explain what they car-ried around and then to react to some early highlighter models. Also, several times six or seven students were in-terviewed together and observed by 3M researchers from behind a one-way mirror—the focus group technique discussed in Chapter 8. Other students were interviewed individually. Windorski’s early models were nonworking clay ones. These nonworking models told him how the innovative highlighters would feel to students eventually using the real ones. When early working models of the Post-it® Flag Highlighter finally existed, several hundred were produced and given to students to use for a month. Their reactions were captured on a questionnaire.

THE NEW-PRODUCT LAUNCH

After the initial marketing research and dozens of techni-cal tests in 3M laboratories, David Windorski’s new 3M highlighter product was ready to be manufactured and marketed. Here’s a snapshot of the pre-launch issues that were solved before the product could be introduced:

● Technical issues. Can we generate a computer-aided database for injection molded parts? What tolerances do we need? The 3M highlighter is really a techno-

logical marvel. For the parts on the highlighter to work, tolerances must be several thousandths of an inch—less than the thickness of a piece of paper.

● Manufacturing issues. Where should the product be manufactured? Because 3M chose a company outside the United States, precise translations of critical techni-cal specifications were needed. Windorski spent time in the factory working with engineers and manufacturing specialists there to ensure that 3M’s precise production standards would be achieved.

● Product issues. What should the brand name be for the new highlighter product? Marketing research and many meetings gave the answer: “The Post-it® Flag Highlighter.” How many to a package? What color(s)? What should the packaging look like in order to (1) display the product well at retail and (2) communicate its points of difference effectively?

● Price issues. With many competing highlighters, what should the price be for 3M’s premium highlighter that will provide 3M adequate profit? Should the suggested retail price be the same in college bookstores, mass merchandisers (Walmart, Target), and office supply stores (Office Max, Office Depot)?

● Promotion issues. How can 3M tell students the prod-uct exists? Might office workers want it and use it? Should there be print ads, TV ads, and point-of-sale displays explaining the product?

● Place (distribution) issues. With the limited shelf space in college bookstores and other outlets, how can 3M persuade retailers to stock its new product?

THE MARKETING PROGRAM TODAY AND TOMORROW

The highlighter turned out to be more popular than 3M expected. The company often hears from end users how much they like the product. So what can 3M do for an encore to build on the prod-uct’s initial success? This involves taking great care to introduce product extensions to attract new customers while still retaining its solid foundation of loyal existing customers. Also, 3M’s products have to appeal not only to the ultimate consumers but also to retailers who want new items to display in high-traffic areas. Product and packaging decisions for the Post-it® Flag Highlighter reflect this innovative focus. In terms of product extensions, David Windorski designed new Post-it® Flag Highlighters and Pens that are easier to hold and that have the flags permanently accessible without twist-ing. As to packaging, it’s cri tical that it (1) communicates

case D-1 3M’s Post-it® Flag Highlighter: Extending the Concept!

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the flags-plus-highlighter idea, (2) is attractive, and (3) achieves both goals with the fewest words. Innovation at 3M never stops. An example is the re-cently introduced 3-in-1 combination that contains a highlighter, a pen, and 3M Post-it® Flags. At 3M, promotion budgets are limited because it relies heavily on its technology for a competitive advantage. This also applies to the Post-it® Flag Highlighter. So you probably have never seen a print or TV ad for it. Yet po-tential student buyers, the product’s main target market, must be made aware that it exists. So 3M searches con-tinually for simple, effective promotions to alert students about this product. Great technology is meaningless unless the product is available where potential buyers can purchase it. Unlike college bookstores that exist largely to serve students, mass merchandisers and office supply stores track, mea-sure, and seek to maximize the profit of every square foot of selling space. So 3M must convince these retail chains that selling space devoted to its highlighter line will be more profitable than stocking competing products. The challenge for 3M: finding ways to make the Post-it® Flag Highlighter prominent on shelves of college bookstores and retail chains. If the Post-it® Flag Highlighter is doing well in the United States, why not try to sell it around the world? But even here 3M faces critical questions: Which countries will be the best markets? What highlighter colors and packaging work best in each country? How do we physi-

cally get the product to these markets in a timely and cost-efficient manner? David Windorski also invented another product for students based on 3M’s adhesive technology: restickable 3- by 5-inch note cards. Their point of difference: They stick to surfaces for brainstorming sessions or notebooks when you want them to and slide across each other with-out sticking when you want them to do that. Asked by students how it’s possible, Windorski just smiles.

Questions

1 (a) How did 3M’s David Windorski get ideas from college students to help him in designing the final com-mercial version of the Post-it® Flag Highlighter? (b) How were these ideas important to the success of the product?2 What (a) special advantages and (b) potential problems did 3M have in introducing a new highlighter-with-flags product for college students?3 Visit your college bookstore before you answer. (a) Where would you display the Post-it® Flag Highlighter in a college bookstore, and (b) how can the display in-crease student awareness of the product?4 In what ways might 3M try to promote its Post-it® Flag Highlighter and make students more aware of the product?5 What are the (a) special opportunities and (b) potential challenges for 3M in taking its Post-it® Flag Highlighter into international markets? (c) On which countries should 3M focus its marketing efforts?

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