Graco 2007 Annual Report Download - page 17

campaigns that are as targeted and
innovative as the brands they promote.
Consumer-driven innovation requires
effective communication with our
target audience. We use our consumer
understanding to identify the points
when the consumer touches our
categories and brands and is most
receptive to messaging. Understand-
ing these points of inuence helps
us form an ongoing relationship and
dialog with our consumers so that we
deliver the most compelling messages
in ways that drive a superior return
on marketing investment.
Increased Investment in Strategic
Brand Building and SG&A
We are committed to making the
investments necessary to create an
effective brand-building organization
and superior processes. Since 2005,
we have increased our investment in
strategic brand building almost 60
percent. In 2007, our brand-building
investment surpassed 6 percent of
sales for the first time. We also are
monitoring and measuring these
investments carefully to ensure that
we are investing in the highest-impact
programs and activities.
Geographic Expansion
Today, 20 percent of Newell
Rubbermaid sales are outside of North
America, and only a handful of our
brands account for most of these sales.
The balance of our brand portfolio
represents a signicant opportunity
for international expansion. Some of
our strongest brands have not yet been
introduced to consumers outside
North America. For example, Sharpie
is the number-one marker brand in the
United States, but the brand is just
beginning to expand to other coun-
tries. With an initial launch in the
United Kingdom during 2007, Sharpie
is expected to increase sales signi-
cantly over the next year in the United
Kingdom as we make signicant
investments to drive distribution and
consumer awareness and demand.
Near-Neighbor Category Expansion
Our brands are crossing to near-
neighbor categories to create opportu-
nities for growth as well. Rubbermaid
Commercial has expanded into
microber cleaning equipment and
medical carts. Irwin and Lenox have
extended their core franchises into
knives and blades, pliers, wrenches,
levels, measuring tapes and worksite
storage. Calphalon has taken superior
design capabilities with respect to cook-
ware and extended those capabilities
to a suite of premium cutlery products.
As we build the image of our brands in
the hearts and minds of our consumers,
the ability to extend them into near-
neighbor categories is an excellent
way to leverage our investments in
consumer understanding, innovation
and commercialization in order to
generate continued revenue growth.
The Irwin “Demand Team” grassroots marketing
initiative goes on the job site to educate professionals
about the brand’s line of industrial tools.
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15
The Fourth Trimester
The Graco® Sweetpeace™ Newborn
Soothing Center™ is one example of the
integrated brand-building process that
is emerging within Newell Rubbermaid
today. The first few months of life for
a newborn are often referred to as
“the fourth trimester.” Better solutions
are needed to help new moms comfort
their babies during this period of
dramatic change and development.
Our design process for Sweetpeace
included up-front, in-depth research
with mothers and pediatric profession-
als who understand better than anyone
else what works to soothe newborns.
Armed with insights from moms,
doctors and babies, our Research and
Development team developed an innova-
tive new product that effectively simulates
many of the sensory experiences of the
womb itself and the cradling and rocking
techniques that parents and professionals
use to comfort babies. As part of the
launch of Sweetpeace, we also built an
interactive educational website with
resources for moms of newborns.
Sweetpeace creates an entirely new
category for infant-soothing products.
Team Hackman® features
a team of master cutters
that conducts events
to demonstrate the
superior performance
of Lenox products.
The new Irwin
Marathon
® with
WeldTecTM saw blade
features patented
carbide teeth for long
blade life and durability.