Turning Supply Risk Fears into a Marketing Strategy

The pace of product recalls and supply risk fears have been increasing. I get quality news updates, and in just one week here were some of the headlines: 

Volvo Recalls Sedans in China

Body Defect Leads Volkswagen to Recall Touaregs

Georgia Company Recalls Anaheim Peppers

More Dry-Milk Products Are Recalled

South Korean Snack Firms Ordered to Recall Products

Baguettes Recalled in Canada

Medtronic Recalls Infusion Tubes for Diabetes Patients

Sprouts, Ski Boots, Night Lights Join Recall List 

The ever-growing list of recalls seems to leave no product category unscathed, from frosting to cars to night lights. There is one company, however, that is trying to capitalize on supply risk and product safety fears as a marketing tool for children’s toys – Vermont Teddy Bears. Teddy bear sales have plunged to about half of what they were four years ago, and an article in The Boston Globe describes how the company’s new CEO is trying to transform the company and get it back on track. Instead of their traditional (and failed) product positioning that targeted thoughtless men who forget their wives and girlfriends birthdays (by advertising the bears on Howard Stern’s radio show, no less), the company is trying to increase its appeal to children, the traditional teddy bear lovers. They are doing this by emphasizing the design and manufacture of the product in a state with a wholesome yet chic image, Vermont. This strategy implies that keeping manufacturing local increases the company’s control over product safety. They are hoping to capitalize on consumers’ fears about children’s toy safety by demonstrating their commitment to safety via a locally-made New England product and their desire for environmentally friendly products by making bears from eco-friendly materials. From a backdrop of supply risk, opportunities can be born.

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