Energy within MILO

The organisation presented is MILO. MILO, which comes in confectionery and snacks bars provides consumers the energy that is needed for the day (Nestlé Singapore , 2012). “Energy within MILO” is our tagline, which emphasizes on the energy that MILO is able to provide for our consumers and how we advertise our products through sports. Being the organisation that has been championing youth sports development in Singapore, MILO has been using various sponsorships and endorsements to support their mission. Some sponsorship includes the Southeast Asia (SEA) Games and other event naming rights sponsorships including MILO Junior Basketball Championship and MILO-MOE Youth Triathlon.

MILO has also ventured into developing global partnership with the MILO Youth Sports Development Programme, collaborating with the Singapore Sports Council and Ministry of Education (Nestlé Singapore , 2012). The endorsement strategies used by MILO includes using local youth sportsmen as our endorsers and were featured in MILO’s various products packaging and advertisements. Though MILO sees itself as the market leader in the category of malt and chocolate malt, it faces indirect competitions from the various beverage categories as well. The issues identified for MILO are:

1.How MILO stands out from competitors during sponsored events 2.Endorsement issues faced by MILO – Appropriateness of MILO’s endorsees 3.MILO maintaining as the market leader

4.Consumers not viewing MILO as a sports drink
In relation to MILO’s marketing strategies in sponsorships and endorsements, we will be focusing and looking into the first two issues identified above. Standing out from Competitors

The first issue talks about how MILO faces challenges in standing out from the competitors during sponsored events. While being the sponsors of a major sports event, MILO might not be the only sole drink sponsor present at the event itself. With the presence of competitors, MILO potentially loses to maximise its reach to the target audiences present at the event, as participants are being exposed to many choices. The lost in share of throat during the events can be significant as well.

Share of throat refers to the amount of drinks a brand can deliver to their target audiences, as at a particular time, a consumer can only consume one drink at a time. Therefore, should the consumers have drank the competitors’ beverage, they would not be able or want to drink, leading to MILO losing that particular share of throat. This could potentially build up and the lost of share could be significant in the long run. Hence, in MILO’s point of view, within the share of throat, any beverage drink company that a consumer would think of at any particular time of the day, or need state, would be considered as their competitors, directly or indirectly.

Sole Sponsorship Rights

An alternative solution for MILO is to obtain the exclusive sponsorship rights for the events that it will be sponsoring. MILO was one of the official sponsors for the South-East Asia Games 2009 and 2011 (LaoSOC, 2009). However, Pepsi and Coca Cola were also among the official sponsor and official partner of the event respectively. This diminished the opportunity for MILO to stand out among the sponsor list as the attention of the target viewers are saturated.

Often than not, people will not associate MILO with Pepsi or Coca Cola, thinking that they are competitors. However, the indirect competition over the share of throat could be a problem for the beverage companies. Though they might have a different target audience, it is one of MILO’s objectives to be the drink that people think of at any point of time.

Benefits of Sole Sponsorship Rights

Being the sole official drink sponsor, it gives MILO the exclusive rights to promote itself during the event and the complete control over the distribution of the event. This will be beneficial to MILO as it maximise the exposure for itself during the event. The category exclusivity would also allow MILO to focus on its marketing efforts and deliver the intended messages to its potential consumers. A series of advertising strategy can also be used to build up the anticipation and excites the potential target audiences prior to the event. This would create the association between MILO and the events and leave an impression in the consumers.

This will also allow MILO to have the rights to spread their advertising booths and area, not limiting themselves to space restriction and therefore, increasing the unique reach they can achieve for each event. The exclusive beverage presence would allow consumers to recall and associate themselves with the brand once the unique contact experience is created during the event.

Each unique reach would be important to MILO, as they are able to leave an impression to their potential consumers and increase the chance of them drinking MILO the next time. MILO would also be able to spread their on-site signage to the entire event, without the restriction of having other competitors in mind. This has been considered on of the most important factor for sponsorship in the recent years as well (Performance Research , 2012)

Limitations of Sole Sponsorship Rights

However, this strategy can be limited as major sports events such as SEA Games would want to attract more sponsors, as more sponsorship may be beneficial to the event due to the monetary benefits it receives. MILO will have to justify why it should be the sole drink sponsor of an event, benefiting itself as well as the event. This could result in higher sponsorship fees in return for its exclusivity, which MILO may not have the monetary capacity to handle.

MILO would also have to take into consideration the choice of events that it chooses to sponsor, as the target audiences of the event might not match with MILO’s. The appropriate match of events MILO sponsors would help to create the match and easy association for the audiences. The benefits that MILO will be getting, in terms of the components included in the sponsorship terms, is also dependent on each event. Though MILO might be the sole sponsor of the event, the reach and potential outcome would differ from each event and each outreach might not translate into sales for MILO.

Endorsement Issues – Appropriateness of Endorsers

The current endorsee of MILO, Calvin Kang, is the only Singaporean athlete who has competed in 4 major competitions . The endorsement scope includes having Calvin Kang to be featured on the packaging of the MILO packs. Past endorsement deals also featured him on the SEA Games posters when MILO was an official sponsor. Other endorsees includes national swimmer Amanda Lim, who was also featured on MILO’s product packaging. However, with MILO’s target audiences are aged 7 – 12 and the gatekeepers, mainly the parents or guardians of the children, the use of Calvin Kang or Amanda Lim may not be appropriate as the gatekeepers might not know them and their achievements.

While most of the gatekeepers would not recognise the endorsees and with little exposure and knowledge of the endorsees, the effectiveness of the endorsement may be minimal. Other factors to take into consideration also include the popularity of Calvin Kang and his ability to reach out to the target market. As Calvin Kang is an existing student and focusing on his sports, he is not able to further enhance his connection with MILO other than merely doing photoshoots and appearing on MILO’s advertisements.

Local Celebrities as Endorsers

As MILO focuses on the “local flavor” of their endorsees so as to further reach out to their target audiences and allow easier association, it has been focusing on locals to be their endorsers. Using famous local celebrities could be a solution to the problems faced by the current endorsers. Elvin Ng would be a possible choice for MILO to feature as the endorser.

Being one of the upcoming celebrities in Singapore, the media exposure Elvin Ng received has been intense. Portraying a healthy, sporty and the “sunshine good boy” image, Elvin Ng would be able to reach out to the youths and the gatekeepers at the same time due to his popularity. Another alternative of local celebrity would include Felicia Chin, a Singaporean actress who also portrays the “girl-next-door” and approachable image.

Benefits of Local Celebrity Endorsers

The factors that will impact the effectiveness of the endorsements include the popularity, likeableness, recognisable and the ease of recall of the endorsers. All these are easily achievable by using a local celebrity who has high appearance rate on television and other media, where average Singaporeans would be able to identify them with. While Elvin Ng or Felicia Chin can be highly recognised by the youths of Singapore and the gatekeepers, this would help MILO in associating the endorsers with the brand easily.

The presence of the celebrities during the MILO events would also be a pull factor for MILO as celebrities will naturally attract crowd and this will bring greater awareness to MILO’s event with the collaborations and appearance of the celebrities. With them being approachable personals, this could draw close the distance between MILO and its consumers. The build up of advertisement can also be a useful way to deepen the association with the endorsers and the brand, allowing consumers to think of MILO and the celebrities as one.

Limitations of Local Celebrities Endorsers

Endorsement conflicts could be a potential limitation for local celebrities, as they would usually hold more than one endorsement at the same time. While MILO’s competitors cover the beverage industry, it would easily conflict with any current or future endorsements that will be taken up by the celebrities. This would have to be strictly enforced before signing the endorsements by both MILO and the endorsers. While using the popular celebrities, overexposure would be another issue, as the audiences might not want to see the same faces for different brands and the shows they are watching.

This may be an irritant to the audiences, creating a negative impression and eventually, cause rejection to the celebrities and the brand. As MILO has always been using local sportsmen and women for their endorsements, the switch can also cause confusion and consumers might not see the association of the celebrities chosen as the endorser. Hence, a build up of image and association should be done before prior to the official introduction of the endorser and the launch of new advertising series. The image and the personality of the celebrities’ chosen should also fit the image of MILO, having the energy within them.

Conclusion

Regardless of choosing the right endorsers or the kind of sponsorship that MILO should give, MILO should consider the fit of the endorsers or the events to the image that they have always wanting to portray. The “Energy within MILO” should be the focus and a series of build-up advertisements should be used to create the association with the target audiences, allowing them to think of MILO at any point of time.

MILO has been doing more sponsorships and advertising efforts as compared to its competitors and they should make full use of it, allowing them to enhance and further the reach the potential consumers. The continuity of their promotional efforts should be used so as to maintain the association that has been built since the start. Though MILO has always been trying to improve their products range and reaching out to more markets, they would have to remember the root of their advertising method, which is to advertise MILO as a sports product through the “Energy within MILO”.

References and Bibliography

1.LaoSOC. (2009). 25th SEA Games Vientiane, Lao PDR (SEA Games 2009). Retrieved 10 20, 2012 from 25th SEA Games: http://www.laosoc.com

2.Nestlé Singapore . (2012). MILO | Nestlé Singapore. Retrieved 10 22, 2012 from Nestlé Singapore : http://www.nestle.com.sg/Brands/Pages/BrandsDetail.aspx?brandguid=28ACDEF6-173D-499A-8983-9CA480945AC0&BrandName=MILO

3.Nestlé Singapore . (2012). MILO Youth Sports Development Programme . Retrieved 10 22, 2012 from Nestlé in the Community : http://www.community.nestle.com/partnership/asia/singapore/Pages/milo-youth-sports-development-programme.aspx

4.Performance Research . (2012). 12th Annual IEG/Performance Research Sponsorship Decision-Makers Survey. Retrieved 10 22, 2012 from Performance Research: http://www.performanceresearch.com/2012-IEG-Study.pdf