The company will spend €80 million on a new advertising campaign to spread its message to customers around the world
Royal Philips Electronics on Monday announced a new brand promise evolving around the concept of ‘Sense and Simplicity'. The company, which is is one of the world's biggest electronics companies and Europe's largest, with sales of €29 billion in 2003, will spend €80 million on a new advertising campaign to spread its message to customers around the world.
The new positioning aims to give customers a distinctive image of a sharper, more focused enterprise, which - throughout the company's activities in technology, healthcare and lifestyle - is held together by a common drive to deliver intuitive end-user experiences.
Gerard Kleisterlee, president & CEO, Philips, commented: "Philips is not the only technology company to grasp the need for simplicity - but I believe we're the first to put a stake in the ground and declare our intent to take action. Others may aspire to be more fashionable, more cool. Our route to innovation isn't about extra complexity - it's about simplicity, which we believe will be the new cool."
"Simplicity is what people expect of technology and it is as applicable to a doctor working under pressure in a hospital with advanced medical equipment as it is to a consumer operating a DVD recorder. Simplicity is equally relevant to our customers, be it in healthcare, in lifestyle or in enabling technologies. In each of these domains, Philips already has many proof points of simplicity and some of these we highlight in our new advertising campaign. The challenge before us is to further realign our company to deliver on our new brand positioning in each and every aspect of what we do and make," he continued.
"To mark our commitment to this cause from today onwards we replace the old motto ‘Let's Make Things Better' that has served Philips well for almost a decade," said Kleisterlee. "While it is not very specific, it expresses commitment to both excellence and improvement. At a time in which our businesses could all define their own direction under one broad umbrella, this was probably okay. With the One Philips strategy of the past years, we see the emergence of another company where the marketing of our businesses is more aligned around a specific target audience and therefore we are now at a point where we're able to get more specific for all of them. Now we're able to tell you exactly how we'll execute further change."
The rebranding initiative is part of Philips' management agenda to make the company truly market-driven and get it back on track to sustained, profitable growth, Kleisterlee explained.
The brand campaign will focus firmly on a core target group consisting of the 20 per cent of people who do 80 per cent of the buying, typically affluent decision-makers in the 35-55 age range and A/B+ category who share a dislike for the unnecessary hassle often created by technology.
"These are the same people, who make decisions in their personal and professional lives that are profoundly interesting to Philips," Andrea Ragnetti, chief marketing officer, said. "One person making a decision on a top-of-the-range flat TV for his or her home could be the very same manager responsible for the purchase of medical diagnostic equipment at a local hospital."
"We wanted this campaign to be true to the concept of 'Simplicity'. We wanted to use a different language than the one you might have expected from any technology company, and from Philips in particular - fresher, cleaner, more human," Ragnetti continued. "Every ad, every insertion tells a part of the story. One ad reinforces another. That is why you will always see multiple insertions in consecutive TV commercial breaks. This is a first and absolutely unique in modern advertising."
The campaign, which was developed together with DDB, Philips' global advertising agency, and media buyers Carat, features existing Philips products that fit the new brand positioning. It will run via broadcast, print and online in the Netherlands, Germany, France, Italy, the United Kingdom, the USA and China, but the global reach of some of the media will give the campaign a wider impact with opinion leaders. The total value of the campaign in the second half of 2004 is around €80 million. At an annualized rate, the spend for the new campaign is comparable with the world's most influential advertising campaigns.
Philips president Kleisterlee said, "As we execute on our mission and go forward with implementing our strategy, Philips will see more and accelerated change. We have clear ideas about how to consistently fill in empty spaces around our core competencies, often in the overlaps of the healthcare, lifestyle and technology domains. In the process, we will enter into new markets and create whole new categories. The mix of our activities will continue to change and our new brand positioning has also been designed to guide us through this next phase of our transformation. The launch of our brand campaign today draws attention to a changing Philips, and we trust it will change over time the way the world sees and experiences Philips."
Kleisterlee also announced the start of a new business group for consumer health and wellness with an ambitious growth target.
In addition to the global advertising campaign, Philips also relaunched the company website www.philips.com. Following extensive research and examination of its web services across users, the site has been completely redesigned to deliver a more engaging, user-oriented experience, fully in line with the Simplicity concept. The new site ties together 56 specific country sites and offers information in a total of 30 languages.
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