What makes a company successful?...

... delivering products and services that are relevant and create impact among consumers.

I combine my expertise as a Marketing executive in a Fortune 500 company and my passion as an investor to find the Companies that I think have "cracked the code" with consumers. Advertising does work. When I see a new product that fits relevant consumer trends, and that is supported with a campaign that I find particularly shrewd and innovative, I know that Company is potentially a great investment.

One of the great investors of all times, Peter Lynch, recommends to "buy what you know". You watch TV, go to the supermarket and walk around everyday. Observe... look around: what you see can make you money in the stock market. Now, let's be clear: a Company is not good just because it advertises. What we have to look for is great products supported with -and enhanced by- great advertising. The principle is simple: if something is good enough to draw your interest, it will be of interest to millions of persons just like you.

It is my goal to share with the reader my findings in the world of marketing which I think will turn into great returns for investors. Profit from it!

Saturday, February 23, 2008

Full speed for General Motors

I am excited about the prospects for General Motors (GM) as a great stock for long-term investment. I see several of its divisions powering ahead with all cylinders running. And consumers are paying attention. I will be covering the different signs I am seeing about GM getting it right in a series of postings, just because there is much going on and much to discuss. I can’t avoid drawing a historical analogy to 1941: it seems that the relentless expansion from Japan’s Toyota may have finally awakened a sleeping giant.
To start this series of posting, let’s focus on GM’s efforts in the top end of the market, the luxury segment, where its lunch has been eaten for way too long by European, and moreover in recent years, by the Japanese offers represented by Infiniti, Acura and the indisputable leader, Lexus. A few years ago, Cadillac initiated an extremely well orchestrated effort to revive a brand that at that time, in the mind of the consumers, only stood for 30-mile-per-hour seasoned seniors indulging in their golden years. A complete re-design of Cadillac’s line and an energetic, cool campaign started changing those perceptions. The effort reached its pinnacle with the launch of the Cadillac Escalade, that immediately became the gold standard for SUV opulence and coolness among the young crowd -by the way, quickly displacing the then heavyweight champion, the Lincoln Navigator-. GM continues to support the brand, and the latest campaign around the Cadillac CTS is the best yet. It is great how, in its commercials, the perfectly targeted spokespersons, exuding a cool, unpretentious confidence, go in a rather matter-of-factly way over the features of the car. Yes, they are the features to be expected from a luxury car… but the difference in Cadillac, what is really important is that when you turn the car on… it will return the favor. This is a brilliant, insightful, and totally relevant way to speak to the affluent young professionals in their own language. What is most impressive is how compelling and personal the message is, and how precise it is at capturing the sensual nature of the pleasure associated with driving a powerful and luxurious car. GM dismisses the conventional and undifferentiating car talk, which everyone else claims time and time again –yeah, yeah, exciting, exhilarating… ho-hum-, and engages the luxury consumers in a peer-to-peer dialogue, reaching deep inside at their truest emotions and desires. The message is targeting the soul, not the brain. The campaign is superbly produced and the talent is spot on for the message. I can only see Cadillac comfortably expanding the space it occupies in the luxury segment. And that is high-octane fuel for GM’s growth.