The last big batch of commercials from Royal Philips Electronics memorably showed, among other things, a stylish couple watching a thin plasma-screen television installed on their ceiling.
Having made several acquisitions since then that have bolstered its presence in a variety of areas, Philips now wants consumers to see it as much more than home electronics.
This week Philips, which is based in the Netherlands, began its first global brand campaign, an effort that will appear in North America, Europe and Asia at a cost of 80 million euros (US$97.5 million). The ads include a new theme, "Sense and simplicity," which replaces the longstanding "Let's make things better."
While the new premise and monumental media budget suggest how serious Philips is about revitalizing its image, they also hint at the steep climb even Philips sees ahead.
"The brand campaign will help us tell the world we are a different company than most of our observers think," said Andrea Ragnetti, chief marketing officer at Philips. "For a company that does 20 to 30 percent of our sales in consumer electronics, we are too well known for that."
The full Philips product line includes medical imaging machines, Norelco electric shavers, lighting systems, computer chips, semiconductors and coffee makers. The conglomerate beat analysts' expectations for the second quarter of this year, reporting a profit of 616 million euros (US$750 million) on an 11 percent increase in sales. And its partnership to make liquid-crystal display (LCD) monitors with LG Electronics of South Korea has produced strong results.
Even though Philips' consumer electronics division also posted a second-quarter profit, the division lost money in the crucial US market. That left the company to promise that cost-cutting in the US meant profitability was "in sight."
"In the states we have more than 20,000 people," Ragnetti said. "That is also the region in the world where the awareness of Philips is by far the lowest."
The Philips brand is far more known, and better regarded, in Europe and Asia, he said. In addition to the Philips brand, the company sold consumer electronics in the US under the Philips-Magnavox name for years. It decided in 2001 to relegate Magnavox to low-priced products and now reserves the Philips name for higher-end offerings.
The campaign was created by the New York flagship office of DDB Worldwide, where Philips consolidated its US$600 million worldwide creative account in July.
"We set out to try to create a more human connection, to keep it more basic, keep it more real, keep it more sensible," said Lee Garfinkel, chairman and chief creative officer at DDB, part of the Omnicom Group.
To that end, the first television commercial in the campaign shows a white, lidded box being opened by an assortment of hands from off-screen, while voiceovers take turns saying things like, "I see technology that has humanity," and "I see technology that doesn't make me feel inadequate." The spot concludes with the line, "I see technology as simple as the box it comes in."
Other commercials and print ads focus on specific products, notably the company's HeartStart Home Defibrillator, which Philips said on Thursday had been approved by the Food and Drug Administration for over-the-counter sales. Philips now hopes the device, which can be ordered for about US$2,000, will be in stores by the end of the year.
With its compact curved plastic case, the defibrillator looks less like a medical device and more like the colorful, egg-shaped Apple iMac computers of a few years ago. Its print ads warn, "After cardiac arrest, you need help within five minutes. The ambulance usually takes nine."
Philips also revisits its flat-screen televisions, promoting a new model that projects a colorful glow on the wall that matches the colors on the screen. The technology was developed by a collaboration between the consumer electronics and the lighting teams at Philips, but the lighting division gets its own tribute in ads boasting that Philips provides the lighting for the Eiffel Tower.
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