Praise for The Truth About Creating Brands People Love
"I recommend this punchy, provocative book that uses vivid case studies to remind us of 51 truths about brands."
David Aaker, Vice-Chairman, Prophet and Author of Building Strong Brands and Spanning Silos
"Brian Till and Donna Heckler have captured the key proven principles of creating strong brands and managing them effectively over the long-run. Their work is practical and applicable to companies across a wide range of industries. They offer concrete marketing strategy guidelines necessary for creating sustainable brand commitment. Their ideas are expressed in an engaging fashion, and the book is divided into concise chapters that can stand alone to make powerful points during brand strategy planning sessions."
Dan Smith, Ph.D., Professor of Marketing and Dean, Kelley School of Business, Indiana University
"Utilizing a broad range of examples, anecdotes, and case history-style narrative, the authors answer many of the recurring questions brand managers and their agencies face every day in marketing consumer and business-to-business products and services. The truth about The Truth About Creating Brands People Love is that it offers sound, actionable advice that anyone in the business of building, managing, and stewarding brands can put into effective use immediately."
Joe Osborn, Partner, Osborn & Barr Communications
"This is an enjoyable read of spirited and engaging 'Truths' regarding effective brand building. Importantly, it is filled with wisdom and insights that apply to all brands and all businesses."
Patricia Seybold, Author of Customers.com, The Customer Revolution, and Outside Innovation
"Brian and Donna have peeled back the secrets of how to make great brands. Filled with countless real life examples, it's an easy and "relatable" read. A great primer for the marketer just starting out or for the established manager who thinks he knows it all."
M. Paul Kravitz, Manager, New Products and Business Development, Nestlé Purina PetCare
"A must read for corporate execs. It brings the basics back to branding."
Brian Abrahams, General Manager, U.S. Sales Division, Anheuser-Busch, Inc.
"A very easy to read-and-apply text that relates well to the new marketing 'guru' and the seasoned vet. A must read for all marketers."
Larry Brayman, Manager of Marketing, Dunkin Brands, Inc.
The Truth About
Creating Brands People Love
© 2009 by Pearson Education, Inc.
Publishing as FT Press
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FT Press offers excellent discounts on this book when ordered in quantity for bulk purchases or special sales. For more information, please contact U.S. Corporate and Government Sales, 1-800-382-3419, [email protected]. For sales outside the U.S., please contact International Sales at [email protected].
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All rights reserved. No part of this book may be reproduced, in any form or by any means, without permission in writing from the publisher.
Printed in the United States of America
First Printing: October 2008
ISBN-10: 0-13-712816-9
ISBN-13: 978-0-13-712816-7
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Library of Congress Cataloging-in-Publication Data
Till, Brian, 1960-
The truth about creating brands people love / Brian Till, Donna Heckler.
p. cm.
ISBN 0-13-712816-9 (pbk. : alk. paper) 1. Branding (Marketing) I. Heckler, Donna, 1963- II. Title.
HF5415.1255.T55 2009
658.8'27--dc22
2008013362
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From Brian D. Till:
I dedicate this book to my family—my parents Lee and Nancy Till and my brother Ken—for a lifetime of love and encouragement, and also to my close friends who have immensely enriched the quality of my life.
From Donna Heckler:
For all their support, encouragement and love, I dedicate this book to my family—my parents Alan and Gerry Heckler and my sisters Karen Thompson and Jennifer Burran. I dedicate this book to my close friends whose love and support I truly cherish. Importantly, I dedicate this book to the children in my life—Andy, Nick, Leah, Fiona, and Audrey—you always help me to realize what truly matters in life.
Contents
Truth 1. Managing brands is not common sense
Truth 2. No one loves your brand as much as you love it
Truth 3. The brand is not owned by marketing; everyone owns it
Truth 4. Making more by doing less
Truth 5. Does your brand keep its promise?
Truth 6. Price is the communication of the value of your brand
Truth 7. Brand personality is the emotional connection with your brand
Truth 8. Does your sales force know the difference between a product and a brand?
Truth 9. Beware of the discounting minefield
Truth 10. Packaging protects your product; great packaging protects your brand
Truth 11. Brand management is association management
Truth 12. The retail experience is the brand experience
Truth 13. Corporate ego: Danger ahead
Truth 14. Brand metrics: Best measure of success?
Truth 15. Customer complaints are a treasure
Truth 16. Brand stewardship begins at home
Truth 17. Market share doesn't matter
Truth 18. Avoid the most common segmentation mistake
Truth 19. Public relations and damage control: The defining moment
Truth 20. Focus equals simplicity
Truth 21. Marketing is courtship, not combat
Truth 22. Don't sacrifice brand focus for sales
Truth 23. The medium is not the message; the message is the message
Truth 24. Brand development and the small business
Truth 25. Imitation is an ineffective form of flattery
Truth 26. Positioning lives in the mind of your target customer
Truth 27. The value of brand loyalty
Truth 28. Quality is not an effective branding message
Truth 29. Effective use of celebrity endorsers: The fit's the thing
Truth 30. Brand-building consumer promotion
Truth 31. Advertising built for the long run
Truth 32. A service brand is a personal brand
Truth 33. Is your brand the best at something? If so, be satisfied
Truth 34. Great positionings are enduring
Truth 35. Effective branding begins with the name
Truth 36. Your brand makes your company powerful, not the other way around
Truth 37. Be consistent but not complacent
Truth 38. Is your brand different? If not, why will someone buy it?
Truth 39. The three M's of taglines: Meaningful, motivating, and memorable
Truth 40. Customer service is the touch point of your brand
Truth 41. Smaller targets are easier to hit
Truth 42. Beware of the allure of brand extensions
Truth 43. Keep advertising simple, but not simplistic
Truth 44. It's a long walk from the focus group room to the cash register
Truth 45. Repositioning can be a fool's chase
Truth 46. With advertising, don't expect too much
Truth 47. Don't let testing override judgment
Truth 48. Effective advertising is 90% what you say, 10% how you say it
Truth 49. Compromise can destroy a brand
Truth 50. Don't let the pizazz outshine the brand
Truth 51. There are no commodity products, only commodity thinking
Preface
Creating brands people love seems so easy. Just look around at all the wonderful brands that we experience every day. Yet, creating brands people love requires more than simply love of a product and spectacularly creative advertising—it requires intelligent, strategic, and coordinated decisions in many areas of marketing. Packaging, promotion, advertising, positioning, distribution, and pricing are just some of the important functions that, when successfully managed, lead to profitable brands that matter to consumers.
The purpose of this book is to illustrate universal truths about brand management that cover the range of brand-building activities. These truths transcend context, providing important insights irrespective of industry-specific dynamics. The guidelines here are as relevant to a marketing manager for a steel producer as for a cereal maker; as meaningful to a brand manager for coffee machines as for a ski resort; as useful to someone running an art gallery as to someone managing a high-end hotel.
For experienced and well-trained marketing managers, these truths provide a touchstone to those basic principles that are sometimes overlooked in day-to-day decision making. For the up-and-coming brand manager, this book provides thoughtful guidance that will serve you well over the course of a career. For senior executives responsible for the marketing function but not formally trained, the book serves as a framework to think about brand building and from which to challenge your marketing staff. Finally, for students, you will find these truths to be a solid foundation for life-long learning in this fascinating business.
The following chapters cover an assortment of issues regularly faced by marketing and brand managers such as media, taglines, brand extensions, brand names, use of celebrities, packaging, and so on. Importantly, though, none of those decisions will matter unless your basic product or service offering is on target. The product or service itself is the starting foundation of a great brand.
Consider Honda. Certainly there are cars more luxurious, cars that deliver greater thrills, and cars that are more stylish. But Honda nails the essence of a great product—reliability, excellent build quality, comfortable, well-planned ergonomics, and good fuel economy. Although Honda's brand image is not flashy, Honda's image does have appeal to a significant group of people. Importantly, the starting point for Honda as a brand is Honda the product.
Gas station and convenience store QuickTrip is another good example of a brand that pays close attention to the little things. The cashiers, in addition to their speedy change counting, are quick with a "Many thanks," or "Come back and see us soon." The consistency from QuickTrip is not simple coincidence but rather an intentional focus on speed and pleasantness. At many service stations, when filling to a prepay of $20, the rate of gas flow drops to a trickle at $19.80 or so, and then the last twenty cents worth dribbles in. Not at QuickTrip. The gas flow is constantly strong until it hits exactly $20. A small detail indeed, but a detail that reinforces the promise embodied in their name—quick trip.
Without diminishing the role and importance of public relations, creative TV advertising, an engaging website, captivating packaging, motivating promotions, or any of the other tools that collectively build strong brands and drive profitability, there is tremendous importance in putting first things first—and the first thing is a fundamentally great product. Great products make great brands.
The Truth About Creating Brands People Love is a complete toolbox of ideas, strategies, and techniques that can take a great product and transform it into a profitable brand people will love. Each concept has at its core a focus on how to connect with the consumer in a meaningful way. Be empowered, challenge conventional wisdom, think strategically, and use this book as a guide to creating a bond between your customers and your brand.
Truth 1. Managing brands is not common sense
If common sense is what most people naturally use in the absence of education and training, then effective brand management is not common sense.
Certainly the more features and benefits you highlight about your brand, the more attractive the brand will be. The more people you try to appeal to, the more effective your advertising will be. That market share is the most important measure of a brand's success is obvious. And what name you attach to a brand isn't all that important—it's what the brand actually does for the consumer that makes the difference. It is completely obvious that "quality" is an effective marketing message. Brand extension as the best way to introduce a new product seems apparent.
Every one of the preceding statements is either partially or completely false.
Yet, talk to many who claim to be marketers, and they will espouse the validity of these statements. Dig a little deeper, and you will find that their marketing "expertise" is based on their idea of common sense. The difficulty with divining marketing strategy is that people live and breathe marketing every day as consumers. People see advertising. People open packages. People try new products. People participate in promotions. In the course of being consumers, people form opinions about what works, or doesn't work, based on their preferences. Their experience as consumers leads them to believe that marketing is basic common sense.
More often than not, effective brand development is the complete opposite of common sense. But the strong belief in this myth perpetuates bad marketing strategy. There are many instances in which administrative assistants, engineers, salespeople, and so on get moved into significant marketing positions because they are "good with people"; after all, brand management is pretty much just common sense!
How many companies further reinforce this concept by making a marketing position something that their star performers must work through to advance in a corporation? Many companies do not hire marketers; instead, they rotate their sales stars or their finance prodigies through marketing for the experience. After all, since managing brands is common sense, you don't need any special expertise in it, right?
With one company, the marketing department wanted to become more creative. The department had gotten stale. There were no new ideas or creative solutions being offered by the department or by the agencies supporting the business. Digging a bit deeper, management discovered that the marketing department was composed primarily of salespeople. The marketing programs developed were actally trade promotions. The advertising had become a mess, with each ad bearing multiple messages about the various product features—not a benefit to be found.
The problem this company experienced was not that there were no fresh ideas. The problem was that there was no marketing strategy. There was not a thoughtful approach to driving profitable sales from the target audience. In fact, the target audience was not even defined. Relying on common sense, the sales-oriented marketing department offered discounts and sales promotions. As good salespeople, they mentioned every feature in the ad. Unfortunately, the great common sense of the sales organization was not enhancing the success of the business.
For senior managers, a reminder that marketing is not common sense is important. If your rise to the top was not through marketing, consider that your perspective on marketing may be based on your understanding of common sense, not marketing strategy fundamentals. Don't be like the CEO who explained that he knew all about marketing because his father had run a printing company—his idea of great marketing was when PMS colors matched. Color match is important at some level, but surely not a driver of marketing strategy.
Effective marketing strategy and brand building are built on a foundation of principles and guidelines that run counter to our natural way of thinking. For example, building an effective brand requires not only understanding what a brand stands for, but what it doesn't stand for; understanding not only who the brand is for, but who it is not for. Such exclusionary thinking is not natural—after all, it is common sense that our brand should appeal to as many people as possible.
Truth 2. No one loves your brand as much as you love it
Managing a brand is like raising a child. You nurture the brand, watch it grow, want the best for it, and intervene when it is struggling. You want the brand to grow up to be strong and successful.
Just as parents find it difficult to be objective about their children, so it is with marketing managers and their brands. It is hard to see the brand from the consumer's perspective. It is difficult to appreciate the minor role the brand plays in the life of the consumer. Minor role? How is that possible? Of course, your brand is enormously critical to your consumer; you make every effort to ensure that it is top of mind for them. For a moment, let's not consider your brand; let's consider the life of a consumer.
It is difficult to appreciate the minor role the brand plays in the life of the consumer.
Ad Age reported a few years back that the average consumer sees over 6,000 brand messages a day! And, that doesn't include Internet brand messaging. How is that possible, you ask? Let's think about a morning for consumers. Their Sony alarm clock goes off, and they hop out of bed to climb into their Kohler shower. They wash their hair with Aveda before toweling off with their Ralph Lauren towels. They brush their teeth with Crest and slip into their Armani suit. They eat a few Cheerios for breakfast before jumping into their Lexus to drive to the office. And you wonder why your brand is not top of mind for them; they have barely made it through the first hour of their day!
To complicate matters further, it is difficult to design marketing programs that reflect your consumers', rather than your, level of involvement. Is it reasonable to expect your customers to purchase thousands of dollars of a product so that they can get a free leather jacket with the brand logo emblazoned on the front? It is unreasonable to expect this if you are a consumer besieged with hundreds of brands and offers. But, if you are a brand manager, you think: Who wouldn't do whatever it takes to obtain that jacket? Is that because you, the brand manager, love your brand—or because your consumers actually love your brand?
Windex is a strong, well-known brand that has been managed over the years by committed and enthused marketing people. Windex brand managers have dedicated a significant portion of their day-to-day life caring for this brand. But just how much do people actually care about window cleaners? How much do they really care about Windex? They may like it. They may use it. But it is simply insignificant in the scheme of their lives.
Mr. or Ms. Windex manager, please don't be disappointed if people leave the room during the Windex TV commercial, if they throw away the brochure you send them on "a better life through cleaner windows," or if they don't visit the Windex web page. It's not that they don't like Windex; it's just that they don't love the brand as much as you do!
Of course, the question becomes: Why does this matter to brand managers? Brand managers want cool, interesting brands. It is this desire that leads to frequent changes to a brand, changes in look, changes in advertising, changes in promotion…the list continues. Keep your brand simple and consistent. When you keep changing it because you are in love with it and you want to keep it fresh, you are forgetting this one simple principle: No one else loves your brand as much as you do.
Truth 3. The brand is not owned by marketing; everyone owns it
One of the most common mistakes in business is assuming that the brand is owned by marketing. Marketing owns the brand because they develop it through their advertising, or promotions, or logo work, or merchandising, right? Wrong. Marketing is the quarterback, calling the plays for the brand, but every person and every department is crucial to the brand's success.
A brand is built through consistency over time. That consistency is never delivered by just one person or one team of people. Consistency is delivered by all those in the company. The experience that the sales representative provides to a customer should be consistent with the brand message. The way the CEO speaks to Wall Street should be consistent with the brand message. Customer service operations must deliver on a brand promise. From strategic departments developing long-range plans to collection departments, every individual must understand and own the brand to effectively deliver its message to the market.
Did you hear Fred Smith, the founder and CEO of FedEx, on Fox News during Fox's CEO spotlight? Mr. Smith clearly articulated the "purple promise," the promise of customer service that FedEx espouses. His focus is on every one of the 280,000 employees of FedEx delivering the purple promise of the FedEx brand to every customer, every single day.
Have you ever had a flight attendant on Southwest Airlines sing to you? A singing flight attendant is part of the casual, fun Southwest experience. Do you think the brand manager called before the flight to remind the attendant to sing? No. Southwest ensures that all of its employees not only know the brand but also embrace what the brand is all about. Southwest then encourages and empowers its employees to bring the brand to life in everything they do.
Somehow, it seems easier to see how every person in a company owns a brand when it is a service brand. However, the same is true of product brands, and perhaps even more difficult to achieve because such importance is not as obvious to the employees. Let's consider the BMW car franchise. BMW is the ultimate driving machine. Every engineer must consider that brand position when developing the next model. The sales teams will try to move a customer to a different model because of the performance available. If you take in the car for service, the service team provides the ultimate experience as well. In fact, the loaner cars are planned out so that all current owners can try a new ultimate driving experience while their car is being serviced.
A basic tenet of brand building is consistency over time. When that is put into the perspective of the multitudes of employees helping to drive the brand, the importance of it can be understood. For those successful companies, brand building becomes expressed through the organizations' culture. Changing a brand message is not only about changing an ad or a logo—it is also about changing the behavior of an organization. Clearly, then, the most successful companies are those that have built the brand and stayed consistently true to its promise.
Consider Marriott and its capability to ensure that service is well understood by all of its employees. During the winter a few years ago, we had to take a trip to Washington DC. Horrible storms in St. Louis delayed the flight to DC. When we finally entered the DC airspace, Ronald Reagan airport was closed again because of weather. The flight landed at BWI instead. Getting off the plane, a long line formed for a taxi at what was now 1:00 a.m. Speaking with the people in front of us, we realized that we were headed to the same general area. They were on their way to a Marriott Hotel in Bethesda, so we decided to cab together and drop them off first. As luck would have it, as the cab pulled into the Marriott, the cab actually caught on fire. (Yes, travel stories like this do happen!)
The woman behind the desk at the Marriott checked in the people from the cab, except for us. We were on our way to another hotel a few blocks away. She tried to call for a new cab for us, but none were available until the next morning. She tried to find us a room, but they were booked. So, she cheerfully said, "No problem—I will drive you there myself." As she drove us the few blocks, we asked a few inquiring questions. She had just started at the Marriott about two weeks ago. She had learned quickly that Marriott was all about service and doing the right things for customers. But, we weren't even customers that night, we reminded her. No problem, she said. We very well could be next week, and she was happy to help us.
The best companies bring their brand to life collectively. As the quarterback, marketing sets the strategy and educates the company. But individuals and departments do most of the work. Thinking back to FedEx, if you want to build a strong, consistently powerful global brand, don't you have a better chance of achieving success if you have all 280,000 employees focused on the same thing?
When everyone owns the brand and everyone lives the brand, the brand takes on a life of its own. Every touch point then tells your consumers why your brand should be their choice. Marketing doesn't own the brand—the entire company does.
Truth 4. Making more by doing less
The most fundamental goal of branding is to generate profits for the brand holder. Every decision should be evaluated through the lens of profitability. Brand development is not about brand awareness, not about sales volume or market share, and not about how cool your brand is. Brand development is about the long-term profitability of your brand.
Ironically, your business can be more profitable by doing less—focusing on a few things and doing those few things very well. But you must avoid the temptation to grow for the sake of growth; you must put aside personal or corporate ego that buys into the "bigger is better" and "size matters" myths.
Hardee's struggled for a number of years. Somewhat adrift in the highly competitive fast food market, there was little that made Hardee's special. With major competitors such as McDonald's, Wendy's, and Burger King (as well as nonburger options such as Subway), Hardee's was in a weak competitive position—and losing money.
Under the leadership of a new CEO, Hardee's simplified its menu, actually reducing the variety of offerings. Hardee's built its brand around the Thickburger® hamburger—a differentiated product—and targeted people interested in burger decadence. Hardee's closed weak-performing stores. The result of this transformation was lower total sales, fewer stores, and increased profitability. Hardee's made more by doing less.
Monsanto is another company currently enjoying a bounty of success, but it hasn't always been that way. Prior to its current CEO, the company had a year of almost two billion dollars of losses and a stock price languishing in the single digits. Monsanto had been a conglomerate with operations covering a variety of areas in the chemical, pharmaceutical, and agricultural industries.
In 2002, Monsanto was spun off as its own independent company after a couple of mergers and acquisitions. Now focused solely on agriculture, Monsanto passionately devotes its business toward improving crop-growing productivity and efficiency. Monsanto employs 3,000 research scientists focused on biotechnology research to ensure that the company maintains its strong position. Monsanto has focused its seed technologies on primarily four crops: corn, oilseeds (soybeans and canola), cotton, and vegetables. With a more narrow focus on seed production, Monsanto is a smaller company than before—but a far more profitable one. Monsanto is making more by doing less.
Companies are finding that the power of their brands comes not from the wide range of markets they serve, but rather through doing a few things well. McDonald's divested the Boston Market and Chipotle restaurant chains to focus attention on improving operations in its own stores. There's an old proverb that "A man who chases two rabbits catches neither."
It takes management discipline to stay focused on the core business. But such focus can create organizational power—everyone aligned around just a few things. Folk wisdom tells us to not put all our eggs in one basket. But, with all our eggs in one basket, we watch that basket carefully! When a company's future is tied to just a couple of brands, those brands get managed carefully.
Turning around businesses such as Hardee's and Monsanto certainly required more than just brand focus. Hardee's new CEO spent time in the restaurants to simplify operations and better understand the customer experience. The restaurants were significantly overhauled to create a nostalgic feel. Developing a differentiated offering—the Thickburger® brand—contributed to its turnaround. Monsanto's CEO shifted the culture to be more intense and results-oriented. Additionally, Monsanto has developed key technological collaborations including with one of its major competitors.
There are many contributing factors to a company's success. But the focus should always be on profitability—and you may find that you can make more by doing less.
Truth 5. Does your brand keep its promise?
People often ask, "What is a brand?" Consider a brand as a promise that you make to your consumers. That promise has two parts to it: what you say you are promising and what you actually deliver. As a brand, you must be true to your word.
As with any promise, once you make it, you have to keep it. Brand managers make promises through the perceptions they create, from the images they develop, the advertising they create, the promotions they offer, the packaging they utilize, and the pricing they establish. Every one of these vehicles, among others, are communicating that brand promise.
Your performance speaks to how your product works, and the service levels you provide. Your performance and perceptions must be in sync or you are breaking your promise; you are devaluing your brand.
The FedEx brand promises overnight delivery. You can send your package with confidence that it will arrive at the right spot, the next day. FedEx uses its advertising, its trucks, and its entire culture to develop and reinforce this perception. But what happens when you don't receive your package on time? It didn't perform. You distrust its service; it did not keep their promise to you. FedEx is an outstanding brand because it routinely keeps its promise. Its performance is consistent with the perceptions it create.
Brand managers are routinely charged with developing some creative ideas to drive their brand's business. This pressure is more intense when there is a lack of product performance. When there are no new products in a pipeline, the marketing charge becomes "just create something fun and exciting." However, nothing can destroy a brand more quickly than creating expectations, interest, and promises about something that doesn't exist. Consumers will be committed and loyal to a brand until that trust is broken. When the trust is broken, it may take years before the brand can reestablish itself.
One of the most famous examples of this occurred with Coca-Cola. Coke decided in the late '80s to introduce a new formulation but still call it Coke. Within weeks, the consumers revolted—so, Coke brought back its original formulation and called the new formula New Coke. At the very core, Coke had changed the performance of the brand but hadn't considered the impact that change would have on the promise of the brand that stood for so much in the consumer's mind.
More recently, a number of toy products, particularly those manufactured by Mattel, were found to have lead contamination. Although the contamination was from the manufacturing sites in China, the promise of the Mattel brand was severely hurt. Parents weren't sure that they could trust Mattel to provide safe toys for their children. Of course, Mattel was not the only manufacturer affected by this manufacturing concern. However, as a leader in toys, it bore the brunt of this situation. Toy retailers, also with a brand promise of providing safe toys, took Mattel to task as well. The promise of safety had been broken, and regardless of the cause, it was a reflection on the Mattel brand.
A similar situation occurred with tainted pet food. Again, the products were imported from China. However, it is the brand's name that is at risk when there is a product problem. In this case, many leading brands from Nestlé to Iams were impacted as their promises were broken and animals were getting sick. Once again, the promise of safety was broken for the consumer.
The cost of correcting the broken promise of a brand can be staggering. Marketing needs to be extremely clear on what the brand is truly delivering. As difficult as it is to do, standing up for a brand and ensuring that the messages of the brand don't get ahead of the performance that can actually be delivered is a critical function of brand management.
Before you build your brand, look at the gaps between your perceptions and performance. Be honest. Just because you want your brand to perform a certain way does not mean that it does. Evaluate what you should change. Is your brand performance too low? Are you creating lofty perceptions? Line them up.
Now go build your brand by truly delivering against the promise you make.
Truth 6. Price is the communication of the value of your brand
Your brand possesses an assortment of attributes and meanings. Your brand connects with your consumer in both rational and emotional ways. Your brand also provides financial value to the company. Your brand is the source of your company's profits. Your brand's attributes, meanings, and rational and emotional connections are sold, via the marketplace, to your customer.
When a family goes to Disney World, they are buying the park, the exhibits, the rides, the food, and the employees who ensure everything runs smoothly. They are buying entertainment. They are buying memories. They are buying an icon of childhood. They are buying being a good parent. All of this represents value to the customer—value worth paying for. Disney creates this total experience in part as it reflects who it is as a business, and in part because this experience is desired by a segment of the market. Disney is investing in a brand experience that people find desirable. The price of this Disney adventure should be commensurate with the value it has created.
Price is the cost of the bundle of attributes and meanings called "your brand." The price you charge reflects the value of your brand—whether you intend it to. The greater the perceived value, the greater the price your brand commands. The more you have distinguished yourself from your competitors, the less vulnerable your brand is to their pricing strategies.
When you price low to gain market share, you say to potential customers, "My brand is not worth much." When you discount your service to meet short-term sales goals, you declare, "My brand is usually priced too high." When you regularly offer coupons on your product to attract price-sensitive consumers, you fail to appreciate the value the brand represents for your loyal customer base.
Price represents more than just dollars from a sale. Price is more than just cost plus 25% markup. Price represents the value of your brand's attributes, associations, and meaning.
Often companies feel competitive pressure to reduce the price of their brand (either directly by lowering selling price or indirectly by raising discounts). A mistaken emphasis on market share or sales volume (rather than profits) drives this pressure. A desire to expand the appeal of the brand also leads management to reduce the price of the brand. But these actions communicate directly the value of the brand—and will have long-term consequences.
Izod Lacoste drove itself to the brink of extinction through price reductions. Originally created as a moderately upscale brand of clothing, General Mills bought the brand in the '80s. Intent on capitalizing the positive image of the brand and maximizing sales, General Mills lowered the quality of the apparel, expanded distribution, and reduced price. In the short run, this worked, as the brand became more accessible to a larger market and sales increased. However, this move planted the seed of the brand's demise. Izod's reduced exclusivity and lower quality made the brand less appealing to its traditional constituency. And, as the brand held less value to its more upscale market, the brand became less appealing to the masses—whose original attraction to the brand was as a status symbol. The lower the price, the less valuable the brand.
Reducing the price of your brand seems appealing in the short run—having potential for increased sales, and being more appealing to a larger market. But caution is in order. In the long run, as your price erodes, your brand erodes.
What is your brand known for? What key associations, emotional or rational, have you developed around your brand? Developing satisfying answers to those two questions is the essence of strong brand management. In developing your brand meaning and attributes, focus on those things that your target consumer values so much that they are willing to pay for them. Starbucks has created a brand experience that commands four dollars a cup of specialty mocha (venti, please).
One goal of marketing is to provide consumers a reason (or reasons) other than price to choose your brand. Your brand's meaning is one of these reasons. Callaway's innovative over-sized drivers give a segment of golfers a clear reason to prefer its brand (and pay a significant price premium).
Pricing decisions are not simple. There are a number of factors to be considered. Are your competitors moving up or down with prices? What is projected for your key labor and materials costs? Do you have a sense of price elasticity. (Are consumers relatively sensitive or insensitive to price?) for your brand? Are there industry watchdogs influencing price behavior? Are you achieving your profit objective? One important factor is the signal your price communicates regarding the value your brand provides. The better your brand connects with your customers, the more indispensable your brand becomes as part of their life. The more emotionally connected your customers become to your brand, and the better your brand meets the needs your customers have, the more pricing flexibility you will have.
Truth 7. Brand personality is the emotional connection with your brand
Marketing and branding strive to connect you with your target consumer. The consumer can have an awareness of your brand. This awareness is recognition of your brand but not necessarily an understanding of what your brand represents. A consumer can connect with your brand intellectually. Such a connection reflects knowledge of the brand's features and benefits—for example, people may have an understanding that Lava soap provides tough cleaning power. Finally, a consumer can connect with your brand emotionally—to have a visceral feeling of the richness of the brand.
The proliferation of brands has led to a proliferation of similar brands. Pennzoil, Valvoline, and Quaker State—a chemist could probably explain the difference, but to many people they are all just good motor oils. What about Charmin and Quilted Northern? Aren't they both just toilet paper? Pour Coke and Pepsi into glasses and what do you have? Basically carbonated sugar water. Competing effectively requires differentiation.
Creating compelling physical differences between brands is difficult—and is made more difficult by the ease at which those physical differences can be replicated. Antilock brakes were once a valuable and unique characteristic of higher-end cars, but now it is unusual for any model to not have antilock brakes. Brand personality, though, can add a differentiating dimension to consumers' understanding of your brand—a dimension not so easily duplicated; a dimension that can serve as your brand's important point of distinction.
Energizer and Duracell have long been battling in the battery market. Their slogans are parity claims—Duracell's "nothing tops the coppertop" and Energizer's "nothing outlasts Energizer." Consumers, though, see distinct differences in each brand's personality. Duracell is viewed as serious, dependable, and tough. Consumers perceive Energizer as fun, hip, and cool (certainly consistent with the on-going use of the bunny). Each brand's personality will be attractive to a different type of consumer.
With brand personality, you create an image of the brand, as if that brand were a person. You instill the brand with characteristics, carefully defined, that bring the brand to life. Be sure to stay focused on those characteristics that reflect actual personality traits. Examples are personality characteristics such as outgoing, wacky, caring, reflective, brash, and competitive.
The MasterCard campaign has done a great job of infusing emotion into its brand. The ads, both print and television, portray a touching moment—and the prices of things that make up that moment. The ads close by declaring the moment itself to be "priceless." The campaign takes a brand that has historically played second fiddle to Visa and imbues the brand with a touching sense of warmth, intimacy, and tenderness. MasterCard becomes a gentle and kind friend, not simply another way to process a transaction.
In developing a brand personality, build the personality around, at most, three characteristics—more than that, and the brand becomes muddled. Consider also that the brand's personality is not identical to your consumer's personality. Some marketers make the mistake of turning their target audience description into a brand personality statement. Just because the target customer is sophisticated, intelligent, and refined doesn't mean that the brand's personality must be.
There was a great series of ads for kiwi fruit. The ads compared kiwis to more familiar fruit. In the ads, the kiwi exchanges dialogue with another featured fruit. A grapefruit challenges the kiwi with the line, "You're kind of small for a spoon, aren't you, kiwi?" The kiwi retorts, "I taste big, sourpuss. Sweet without sugar." In an ad with a banana, the banana says, "I taste good, you taste good. I've got potassium, you've got potassium. So?" To which the kiwi replies, "So, monkey see, monkey do." This great campaign gave factual information about kiwi fruit but also created a personality around kiwi as quick-witted, brash, and saucy. That doesn't mean that the target consumer's personality was quick-witted, brash, and saucy, however. Your brand's personality should be appealing to your target but not the same as your target.
The soft drink market is highly competitive, with brands such as Coca-Cola, Pepsi-Cola, Mountain Dew, and Dr. Pepper battling for consumer affection. Certainly there are taste differences among these brands. But these brands work to create emotional connections through personality differences. Coke is more traditional, mainstream. Pepsi has long nurtured a more youthful brand image, striving to connect with contemporary young people. Mountain Dew has successfully revived its brand through association with extreme sports and the development of an active, energetic, and outgoing brand personality. Dr. Pepper has a history of casting itself as independent, off-beat, and eclectic. Each brand creates a personality that some segment of the market will respond to. Each brand's focus is more on its unique personality, not physical differences.
Yes, facts and knowledge about your brand are important. Facts and knowledge create an intellectual connection. Creating an interesting personality around your brand helps as well—it helps create an emotional connection with your consumer.
Truth 8. Does your sales force know the difference between a product and a brand?
Many salespeople sell products—items consisting of features and benefits.
"This car has 25 cubic feet of cargo space."
"We promise delivery within 48 hours."
"Our parts are machined to the highest tolerances in the industry."
This is all product talk; all statements about attributes. Good salespeople are trained not to focus solely on attributes but to turn the attribute into a benefit:
- "25 cubic feet of cargo space" becomes convenience for the busy family and family trips are made easy and comfortable.
- "Delivery within 48 hours" translates into quick possession.
- "Delivery within 48 hours" may for a business mean lower inventory requirements and reduced carrying costs.
- "Machined to the highest tolerances" means fewer headaches on the production line.
Great salespeople, though, are trained to focus on the brand and the fuller meaning that the brand brings. Not that storage space (and comfortable trips), fast delivery (and quick possession), and well-crafted parts (with fewer worries) aren't something that can be even more compelling to consumers—but emotion and imagery are.
A brand is more than features and benefits. A brand also represents a complex set of imagery. This imagery is often as motivating and relevant as the objective features and benefits of the product.
The Land Rover provides great carrying capacity…but the brand represents adventure. This adventure theme is reflected in the name. Ads for Land Rover focus less on specific attributes and more on the spirit of a brand that can transport you to any locale around the world, and, as depicted in one TV ad, to literally the end of the Earth. Land Rover salespeople need to be as well versed in the meaning of the brand as they are in product attributes, such as towing capacity and clearance height.
FedEx provides overnight delivery…but the brand delivers confidence. Budweiser refreshes on a hot afternoon…but the brand reflects a touch of American heritage and tradition.
Salespeople who have part of their compensation tied to sales of their product or service will sometimes be too quick to advocate for price concessions or special discounting programs to meet end-of-quarter sales quotas. Although understandable, this enthusiasm for price reductions can weaken the brand, which, ideally, should be competing effectively on some characteristics other than price.
Your sales force needs to understand not just the features and benefits of the product (or service) they are selling, but also the emotions and imagery of the brand. They need to understand how the brand makes an emotional connection with the end user—and that this emotional connection has value. They need to see meanings that the customer has wrapped around the brand. They need to recognize that while price is important, it should not be the primary point of emphasis in selling the brand.
The brand team, as the steward of the brand's meaning, works hard to discover and manage consumer perceptions. The brand team must also train the sales force in the meaning of the brand. The brand team should ensure that the sales force understands the brand's positioning (primary association) and equities (supporting associations). The sales force should see how the brand's marketing mix—advertising, public relations, website, product brochures, and special promotions—all work in harmony to create a consistent, cohesive, and clear brand image.
Truth 9. Beware of the discounting minefield
On sale. Clearance sale. Holiday sale. 25% off. 50% off. It never ends. Roy Williams in Wizard of Ads describes constant promotion as the cocaine of advertising. That's a good analogy since discounts make us feel good in the short run (as marketing teams see sales gains) but risk killing the brand in the long run (by cheapening the brand's image and shrinking profit margins). As consumers become acclimated to this activity, it takes larger "doses" to keep generating interest and sales gains.
The problem with discounting is that you might never go low enough. There may always be a competitor willing to be cheaper than you. And that simple point is the crux of the discounting dilemma. Although an organization may agonize over a few percentage point shifts in a discount—should the sale be at 20 percent or 25 percent off—there are other competitors who will be willing to discount deeper to stimulate revenue and market share.
Discounting is a minefield, and one in which you will most certainly lose. Even if you are brave enough to offer the lowest prices and ultimately win the weekly volume award, you have eroded your brand in the process, losing a more precious element along the way: your brand's equity.
Kmart attempted to revitalize itself. Enthusiastic CEO Charles Conaway brought in a slew of fancy executives from places like Wal-Mart, Coca-Cola, and Sears. Their strategy for saving the brand? Compete head-on with Wal-Mart through extensive discounting. Really, that was it. Price reductions combined with extensive consumer promotions communicated through a steady stream of mailers. Ultimately, this strategy led to bankruptcy, the departure of Mr. Conaway, and finally a merger with one of Kmart's key competitors.
Competing on price is the weakest of positions. First, marketing should provide consumers with a reason, other than price, to do business with you. Target understands this. Although competing in the domain of discounters, Target has created itself as a hip discounter through creative merchandise selections and interesting advertising. Second, Wal-Mart's success with its low-price focus is due in large part to brutally efficient operations—an efficiency that Kmart was unable to match. Third, competing directly with a dominant market leader is rarely the path to success. Successful brands are built not through imitation but through differentiation. What logic could lead anyone to believe that Kmart could out-Wal-Mart Wal-Mart?
The battery wars are interesting to watch from a pricing perspective. Duracell has a slight market share lead over Energizer. Rayovac is a distant third in market share. Rayovac is always the cheapest at point of sale of the major national brands. Duracell is typically the market leader and the price leader at point of sale, striving to keep a 5-cent to 10-cent price advantage over Energizer. But, don't be confused—in the battery world, a price advantage for Duracell is being priced a few cents above Energizer. Why? Because Duracell understands that the price leader is often seen as the market leader, the quality and performance leader. All are brand attributes that relate back to a 5-cent to 10-cent price differential over their competitor, Energizer.
You can just see the Energizer sales associate proudly telling the head of marketing that he had secured a 5-cent discount versus Duracell. The sales team cheers because of the short-term volume potential. The marketing executive groans because once again, Duracell is positioned as a leader simply by premium pricing at point of sale.
Too many times, marketers convince themselves that the discount is just this one time. A temporary price reduction (TPR) is taken at a grocery store. A national coupon of significant value is dropped across the county. A special buy one get one (BOGO) program is provided for a mass merchandiser. The next thing you know, the consumer has become trained to wait for discounts. Your brand is now known as sold below your recommended retail price and a little brand erosion has begun.
Discounting is a minefield because you never quite know when a discounting move will blow up on you. At what point has the consumer become so used to a promotional price that they refuse to purchase your product when it is not on sale? At what point is your competitor so desperate that it will drop prices significantly to capture your volume? If you do not have strong brand equity, if it has been declining due to price discounts, can your brand sustain such a pricing blow?
There is no denying that it is a fine edge to walk—the balance between short-term gains from discounts and the impact on long-term brand building. But, be careful about over-promotion and extensive discounting. Walking into that minefield led Kmart to bankruptcy court.
Truth 10. Packaging protects your product; great packaging protects your brand
Packaging is an important component in the marketing of a brand. Certainly, it provides important functional benefits to the product. It keeps the product safe, protects it, provides a means for displaying it, and is a communication vehicle. But, stop there, and packaging is not providing its potential value. Great packaging contributes to the success of the brand.
There was a billboard quizzing "Quick, Name a Soft Drink." On it was the picture of a Coca-Cola bottle—the green glass and distinctive shape known the world over. What was missing was the name Coca-Cola. This is the power of great packaging. Coca-Cola does not even need to place its actual brand name on the bottle; everyone recognizes the brand by its packaging. Consider Pringles. Pringles differentiated itself from the myriad of snack chips through the uniform shape of the chip in a distinctive package cylinder in a category where every other brand comes in a bag. Not only does the package visually distinguish Pringles from its competitors, but, importantly, it also reinforces the brand's unique distinction of uniform chips. The strong connection between the brand name, the packaging, and a key product attribute remains one of the great lessons in the power of packaging to drive a brand.
The heartburn remedy Nexium is known as "the purple pill." Encased in a purple gel cap, Nexium has established the color of the package as a powerful equity. Similarly, Viagra has become known as the little blue pill. Again, both the color (blue) and shape (diamond) have become important packaging equities for this pharmaceutical brand.
Tiffany operates in a competitive high-end jewelry market. And, its trademark blue box provides a recognizable point of distinction sure to bring a smile to the gift recipient.
Packaging engages with the customer—and can increase or decrease the customer's satisfaction with the product experience. We love Oreo cookies but become maddeningly frustrated with the packaging. We try to carefully open the package—but the inevitable long tear down the plastic hampers keeping the cookies fresh. There is no good way to reseal the package. We fold over the plastic and stack soup cans on top. Or we wrap up the whole package in plastic wrap…and then have to fiddle with the wrap every time we return for a few cookies. We have finally said "forget it." The package has failed the brand.
Simple package ideas enhance the customer's experience. Sargento grated cheese comes in an easy-to-open, resealable pouch. Tide laundry detergent includes a measuring scoop inside the box. There was a little-known brand called Glacier beer. The bottom of the bottle had a cutout in the shape of a twist-off bottle opener—you could simply use the bottom of one bottle to open the other. The issue of opening the last one aside, what a delightful package idea for enhancing the customer's ease of use! Your package is an intimate connection with your customer. Make it a connection that facilitates, not frustrates, the use of your brand.
Packaging can also serve to enhance and reinforce brand image. A company called Pinnacle Natural Brilliance makes Souveran, an expensive high-end car wax. Souveran consumers are drawn to the quality of the actual wax—a rich, buttery, 100% carnuba. Pinnacle Natural Brilliance has invested in packaging that reinforces Souveran's high-end image. The box for Souveran is a rich black with labels in primarily red and gold. Opening the box reveals a nice "thank you" note from the company. A gold pouch inside the box contains the jar of wax. The jar is in the same black, red, and gold colors. A wax applicator (gold) and a microfiber towel (royal blue with a gold wrapper) are also included for removing the wax. Much thought has gone into creating a package that reinforces the brand's image (and high price!).
Tea Embassy, a specialty tea house in Austin, sells a variety of quality loose teas. The family who runs the business is extremely knowledgeable about tea. Purchased tea is scooped into resealable protective pouches. Then a label is affixed to the pouch. The label indicates, of course, the type of tea. Importantly, though, the label also specifies exact directions for getting the maximum drinking enjoyment. ("Steep one tablespoon per cup for two minutes in below boiling water about 180 degrees F.") Tea Embassy also uses the label to provide information about the tea. Natela's Gold says "Lifelong Georgian tea artisan, Natela, prepared this special batch of black tea near the Black Sea." The simple tea package reinforces Tea Embassy's expertise.
Yes, your packaging has to protect your product. Yes, it has to communicate information. Yes, your package needs to provide a means for displaying your product. But, most importantly, your package must reinforce your brand's distinction. Does your package have a unique shape (like Coca-Cola) or a unique color (like Nexium)? Does your package communicate your brand's differentiation (like Pringles)? Does your package contribute to the image of your brand (like Souveran or Tea Embassy)? The package is the last opportunity to communicate the brand before it is purchased. Is your packaging simply doing its job, or is it great?
Truth 11. Brand management is association management
Building, developing, and maintaining a strong brand requires management of a brand's associations. It is these associations, reinforced consistently over time, that give a brand its meaning. What does the brand "Nike" mean? Maybe athletics, determination, running, and performance? What about the brand "iPod"? Perhaps music to go, hip, and easy to use? Do these meanings come through by accident? Of course not. Brands with solid, clear meanings are carefully designed and nurtured.
Effectively managing your brand's associations requires an understanding of the basic structure of human memory, for it is in memory (the mind) that a brand lives. Memory is simply a collection of nodes and links between those nodes. For example, the node in memory labeled "New York City" might have associative links to the nodes "Broadway," "expensive," "9/11," and "vibrant." Brands, of course, are also nodes linked with other nodes. For example, the brand "UPS" might be linked to "brown," "package delivery," "reliable," and "courteous drivers." Because brands exist in memory, not every person is going to have the same set of associations for a given brand. Powerful brands, though, strive to be reasonably consistent as to the set of associations around the brand and strive to have the same associations linked to the brand from person to person.
These associations around a brand vary in the strength of the link with the brand. The brand Starbucks might have a strong link to "green" or "relaxing ambiance" and a weaker link to "music." The strength of the link reflects the likelihood of that association coming to mind when people think of the brand. Brands, therefore, want strong links with associations that matter.
Developing these strong links to relevant and differentiating associations is a key task of brand management. And there are fundamental principles that guide the formation and strengthening of these links.
One of the most basic principles for developing strong associations is repetition. Repetition reinforces the link between the brand and the association. DeBeers' use of "Diamonds are Forever" year after year builds a strong association between diamonds and "timelessness." Wheaties' repetitive use of "Breakfast of Champions" strengthens the association between the breakfast cereal and winners.
Consistency, related to repetition, is another important principle that facilitates strengthening the link between a brand and an association. Be consistent over time, as in the DeBeers and Wheaties examples, but also be consistent across communication modes. Michelin has used the Michelin Man since 1898 (consistency over time) and also uses the Michelin Man in much of its advertising, its website, and in tire dealerships (consistency across marketing tools). This consistency helps strengthen the relationship between the brand Michelin and this symbol of trustworthiness.
Brand managers at times want to add a new association to a brand. Adding new associations to a brand can be a challenge. The more associations a brand already has, the more difficult it is to add a new association. Think of associations as competing for a place connected to the brand. If a brand has a number of strong associations in place, it is difficult for the newcomer to find a good spot to attach itself to the brand. This is one reason why it is difficult to change perceptions of a long-standing, well-known brand.
A brand's meaning is much more elastic early in the brand's life, before many associations have strongly taken hold. Also, some brands have been around a long time but have never developed strong, clear associations in the mind of consumers. These brands also have some flexibility in adding new associations.
It is easier to add new associations when the new association is consistent with the existing associations for the brand. For example, if a brand has the associations "youthful," "contemporary," and "fast," it is much easier to add the association "fun" than if the brand's associations were "serious," "dependable," and "competitive." "Fun" is simply more consistent with the first set of associations than the second set.
When designing the set of associations for your brand, start with an understanding of the current existing associations your customers have for the brand. Your best strategy may be to reinforce those. Also, new associations can be more easily added to your brand if they are consistent with your brand's current associations. Don't overreach with the number of associations you want to develop around your brand. Choose perhaps three or four powerful ones. Brands, particularly those that have been around for some time, can have a number of associations in their orbit; but you want to choose the three or four stars—the associations that are most relevant and distinguishing—to build your brand around. You should focus your communication activities around those three or four associations, which will be your brand drivers. Look for ways to integrate those associations across your communication vehicles—advertising, website, sales force, public relations, package, and point-of-sale materials. Stick with those associations over time. Brand management is association management.
Truth 12. The retail experience is the brand experience
Even with all the money spent in managing the communications around a brand, so much of a consumer's sense of a brand comes through the brand experience. This is particularly true in a retail environment where ensuring brand consistency can be more challenging than with the manufacturing of products.
The Apple Store is a great example of a retail experience that is consistent with and enhances the brand. With a clean, light layout, the computers are spaced for easy use by potential customers. The store color scheme is integrated with the colors of the computers. The store atmosphere has a clean, minimalist feel. Employees are friendly, knowledgeable, and accessible. The entire sense of the store reinforces the brand's image of a friendly, easy-to-use, and stylish computer. Small decisions, like naming the help desk something creative like "Genius Bar," reinforces Apple's brand image.
Although the size of the Apple Stores vary—for example, the downtown Chicago store on Michigan Avenue is two stories, whereas the St. Louis stores are smaller mall locations—each location creates a similar brand feel.
Successful brands strive to maintain a consistency in presentation. Retail brands, with operations sometimes flung worldwide, require extra vigilance. Porsche, with showrooms across the globe, has been moving toward dealerships that carry only its brand (as opposed to multimarquee dealerships, which feature a number of automobile brands). Porsche has created a uniform visual look for dealerships in areas as diverse as the U.S., Mexico, Great Britain, Singapore, and its home country of Germany. The design specifications were set by Porsche and create an exclusive and distinctive look. Steel and aluminum exterior, metal used in the interior, and black walls and floors create a consistent visual feel designed to highlight its cars and reinforce a contemporary, technologically advanced image.
Since 2000, Porsche has opened more than 500 of these "Porsche Centers" around the world. An international network of architects, known as "Brand Guardians," help coordinate the design and development of the individual dealerships—each of which requires an average investment of 2.1 million euros. Although the individual dealerships vary with respect to size and physical configuration, they all are adapted to the brand look first created in Stuttgart. Although Porsche sells its cars in markets that vary widely with respect to economic, social, and political influences, Porsche recognizes the value in a unified global look.
Similarly, BMW has worked with its motorcycle dealers to upgrade and standardize its retail look and feel. Motorcycle dealerships can have a casual, gritty flavor. BMW wants dealerships that have a more contemporary, upscale sense that reflects more closely its desire for the brand.
Sometimes the retail experience can run counter to the general direction of a brand. Wolfgang Puck is a well-known culinary luminary. His restaurants are widely acclaimed, and his brand has an upscale feel to it. Chicago's O'Hare airport had a retail kiosk called Wolfgang Puck Express. Selling sodas, candy, and miscellaneous odds and ends, this retail venture, while no doubt making a profit from a captive audience, risks cheapening the Wolfgang Puck image. Such a disconnect between an elite culinary brand and a mini-mart probably does little to add to the exclusive image Wolfgang Puck has created with his restaurants.
Inventory assortment is part of the brand experience and should be managed to reinforce the brand's key focus. The selections that customers encounter in the store create an impression of what that retail brand represents. Keep your inventory consistent with your brand.
A local Passport Luggage had the expected displays of luggage. Also sold there were ancillary items such as briefcases, backpacks, fanny packs, and Swiss Army knives—all items, although not technically luggage, that are related to travel. The name "Passport Luggage" creates an image around travel and adventure. The name creates expectations about the brand experience and the kinds of items to be found there.
This store also had a nice display cabinet of Waterford crystal. Hmmm…now that's interesting! Probably somewhere along the line, someone found some research that people who travel are more likely than average to buy fine crystal. So, being logical business people, it only made sense that Passport Luggage would add Waterford to the store inventory.
The problem with this logic is that it seems highly unlikely that someone shopping for luggage would make an impulse purchase of expensive crystal. And it seems equally unlikely that when actively in the market for fine crystal, someone would think to go to a luggage store. Much later, sensibility prevailed and the display was removed. Displaying and selling Waterford crystal simply wasn't part of the brand design for Passport Luggage.
Creating a powerful retail experience begins with a commitment to consistency. It begins with an understanding of what the brand is intended to mean. It begins with an appreciation for how the brand meaning should shape the retail experience. It begins with the realization that for retail brands, the retail experience is very much the brand experience.
Truth 13. Corporate ego: Danger ahead
Confidence is great. Confidence supplies the fortitude to forge boldly ahead. Overconfidence and hubris, though, can result in many bad branding and marketing decisions.
Wal-Mart has seen great success—providing basic goods to millions of Americans at affordable prices. Wal-Mart no doubt employs many bright and educated people charged with making sound decisions to move its business ahead. These bright and educated managers are not, however, immune to judgment clouded by overconfidence. With intent to expand its customer base, Wal-Mart began to move into more upscale fashionable clothing. This move failed—that is not how people knew Wal-Mart. Even more affluent customers who shop at Wal-Mart for deals on household basics like laundry detergent aren't going be so interested in purchasing clothes there. Wal-Mart recently abandoned DVD rentals and downloads. Apparently, competing with Netflix wasn't such a good idea. Wal-Mart's music download business will almost certainly never approach the success of Apple's iTunes. To applause from Wall Street, Wal-Mart is reorientating itself to its fundamental mission of selling basic goods at attractive prices—a little bit of a corporate ego reality check.
Talbots has made a good name for itself with clothing designed for the upscale professional woman—and the brand has come to mean just that. Talbots men and children stores (first opened in 2006 and 1993, respectively) have been a failure and are now being shuttered. That a brand associated with women would be successful in attracting men could only be attributed to a case of overblown corporate ego.
Snapple beverage company was formed by three health food store owners in 1972. Snapple's iced teas (first introduced in 1987) began to build success for its business, and Snapple's advertising had a home-spun, down-to-earth feel to it, reflected by Wendy the Snapple lady. Seeing the growing success of Snapple, and no doubt certain it could do a much better job managing the brand, Quaker Oats bought Snapple for $1.7 billion in 1994. Unfortunately for Quaker shareholders, the Snapple lady was probably a better brand manager than the high-powered Quaker marketing managers. Three years later, Quaker abandoned ship and sold off Snapple at a $1.3 billion loss.
Clorox recently purchased Burt's Bees for close to a billion dollars. With a reputation of eco-friendliness, Burt's Bees' products sell at a nice premium against similar mass-marketed brands. Clorox will need to preserve the integrity of the Burt's Bees brand to ensure that its investment was a wise one for its shareholders. Clorox will need to do a better job than Quaker Oats did with Snapple in not losing the special noncorporate aura that has led to Burt's Bees' success.
The brain child of then-chairman Ferdinand Piech, the $100,000 VW Phaeton was a colossal failure. VW employs many bright, sharp people. Clearly, some of those bright people could see the folly of trying to sell a six-figure Volkswagen. Who, though, is going to walk into the chairman's office and challenge him on his own pet project? Only someone otherwise close to retirement!
Ford Motor Company has recently chalked up almost $5 billion in losses over a recent four years under the misguided belief that it could successfully manage a set of European luxury brands. Ford has sold off Aston Martin Jaguar and Land Rover. Ford has a proud history of designing and building cars for the middle class—and it has plenty of challenges just staying competitive in that market! Perhaps the luxury car business was biting off a bit more than it could chew.
Dodge has inked licensing agreements that have included high-end Dolce & Gabbana t-shirts, garage floor surfaces, bicycles, and dog bowls! With sales lagging and no-nonsense private equity firm Cerberus having taken over, Dodge management would be better served by figuring out how to sell more cars and trucks and be less concerned about how many dog bowls its logo appears on.
Nike sold off the Starter footwear and apparel brand it purchased some three years prior. A successful brand in its own right, Nike surely was confident it would find success with this lower-end brand. Ultimately, however, Nike acknowledged that its business would be better served by focusing on selling higher-priced shoes.
Payless is a low-end shoe chain that specializes in…well, the name says it all. In response to slowing sales, Payless has begun to carry more stylish, trendier, higher-priced shoes, hoping to attract a younger, hipper consumer. But Payless risks alienating its current customer base. And, at the same time, it may fail to attract these new customers, who have plenty of other places to shop for more stylish shoes. Zales failed with this exact same strategy, fired its CEO, and reversed course to its original focus on affordable jewelry.
As if the upscale fashion business weren't competitive enough, Armani announced that it is partnering with electronics producer Samsung to develop a line of high-end electronics. Time will certainly tell, but an upscale fashion brand not known for electronics combining with an electronics manufacturer not known for prestige goods sounds like the worst of both worlds driven by inflated corporate ego.
Success in one area does not automatically result in success in another area. That Wal-Mart management has been successful serving one part of the market does not mean that management can successfully take the Wal-Mart name into a different market. That Ford has mastery of selling cars to middle-class America does not mean it has a special capability to manage higher-end luxury brands. An overly inflated corporate ego can cause managers to overestimate their competencies and fail to see the limitations of their brands. Be humble, be honest, be true.
Truth 14. Brand metrics: Best measure of success?
Brand metrics—measures of the effectiveness of marketing activity—have become all the rage of late. And for some good reasons. First, a variety of technological advances have facilitated gathering information. The prevalence of scanner data collected at large retailers, "people meters" that provide increased accuracy in tracking media usage, and the growth of measurement-friendly web commerce have all increased the amount of data available to marketing managers. Second, corporate boards are increasingly demanding accountability for marketing spending. Companies that have elevated the importance of marketing through the relatively new title "Chief Marketing Officer" are also elevating expectations of quantifiable performance. It is just smart business to ask: "What are we getting for our investment?"
Fundamentally, brand metrics are designed to measure and assess marketing activity. Brand metrics can be used (and misused) in a variety of ways. Because marketing and brand-building activity are designed to enhance profitability, the most relevant metric is return on investment (ROI). The idea is simple: For any marketing action, determine what sales were the direct result of the marketing action, determine the profit on those sales, subtract out the cost of the marketing action, and, voilà—you are left with the incremental profit directly attributable to that marketing action.
Measuring the impact of marketing activity this way can work in certain instances when there is a close link between the marketing activity and sales. Consider a brand that runs long-format infomercials. Air time is purchased. The infomercial runs with a unique response number keyed to that particular airing. Calls come in, units are sold, costs are easily attributed to that particular commercial, and profit is tallied.
But what about the following example? A business-to-business company reserves booth space at a major trade show where a number of potential customers will be attending. The company dutifully totals up expenditures—travel and lodging, space rental, costs for a nice display, product brochures, and salary for the company representatives working the booth. At the show, a number of contacts are made and leads generated. After the show, salespeople make follow-up calls, and sales orders come in. Two months later, an assessment is made of the effectiveness of attending the trade show. But wait…what about orders that came in within two months of the show but would have been placed anyway? What about a contact made that resulted in no order? And what if, a year later, when looking for a new supplier, that contact remembers the company they met at the trade show and requests a meeting with one of the sales representatives?
Consider a more involved example. A large consumer brand receives a significant increase in support. Packaging is revised, a new ad campaign is created, media spending is increased, and an innovative consumer promotion is implemented. Sophisticated time series analysis can provide some retrospective assessment of the overall effectiveness of this effort but will leave questions about the relative impact of each individual component unanswered. Was it worth redesigning the package? Did the new ads make a difference (or was it just the increased media spending)? Assessing these individual tactics is extremely difficult.
Here are several thoughts for developing brand metrics for your business: Don't be a slave to metrics, measure what matters, and keep an appropriate sense of perspective.
Don't be a slave to metrics. There will be important marketing objectives that are either impossible to quantify and measure or simply cost prohibitive to do so. For many companies, quantifying metrics like brand awareness and brand attitude is simply too expensive. Small and medium-size companies don't have the market research budget to support measuring a wide assortment of metrics, regardless of how important those metrics might be. For example, the impracticality of measuring the impact of business-to-business advertising in trade publications does not mean that such advertising should be eliminated. Such advertising may be playing an important, albeit difficult to measure, role in supporting your brand.
In addition to ROI, there are a variety of popular brand metrics, including brand awareness, sales, market share, repeat rate, brand attitude, share of requirements (percent of a consumer's category purchases that go to your brand), satisfaction, and so on. Choose those metrics that you believe are true profit drivers for your brand. It's said that what is measured is what is managed. If you focus on things such as brand awareness and market share, you will get lots of those things—regardless of whether brand awareness and market share are actually linked to profitability.
Keep a sense of perspective on your use of brand metrics. Some marketing actions, like discounting, can have a positive short-term effect on metrics like sales, trial, and market share, but hurt the value of your brand in the long run. Some marketing activity that is vitally important to the success of your business may have benefits that unfold over a particularly long horizon. Certainly John Deere expects its dealer activity to have some positive effect on sales of tractors and equipment to farmers. But John Deere works to build relationships with farmers that span generations. It's a little harder to directly measure the impact of that!
Accountability expectations aren't going away. But brand metrics are not substitutes for good reason and judgment. Kept in perspective, brand metrics can provide some helpful guidance in assessing the impact of your marketing activity.
Truth 15. Customer complaints are a treasure
Brand managers, on the whole, are terrified of customer complaints. Companies measure customer satisfaction, and declines in customer satisfaction are strikes against a brand manager. Year-end reviews often include an assessment of brand likeability and, therefore, include complaints. However, a customer complaint is an opportunity to really understand what matters to the customer and to get a deeper understanding of the target audience.
Companies often promote the message that "the customer is always right." You have heard that before, but do the exchanges and the complaints actually translate into a better experience or product for the customer? Not always. You return a product to Wal-Mart, for any reason, and you receive prompt, courteous service. The matter is taken care of, and the customer leaves happy. However, the manufacturer, or perhaps Wal-Mart itself, is missing out on an enormous opportunity to understand what can be done to make the product better. Did the shirt not fit because the cut was wrong, which made it tight in the shoulders? Did the hair dryer not work out because the cord wasn't long enough? Did the household cleaner come back because the smell was too pungent? There is so much more depth to a complaint that is often missed.
Lands' End is a company that strongly embraces customer complaints as treasure. It learns from them. It tells you what it learned, it makes adjustments in its product, and it tries again. If you purchase from there and need to return a product, you will find detailed questions about the return. What part didn't fit? What was wrong with the fit? These questions are not done to "trick" the customer so that the return is not accepted. They are done to understand how it can better design the product. In fact, Lands' End clearly lets every customer know that anything can be returned at any time—there is no risk. It wants happy customers, and importantly, better products for those customers.
Lands' End takes its commitment a bit further. Look closely in its catalogues, and you will see references to its learning. "We heard you," it will often write, "and so we have cut the leg a bit narrower" or "extended the length of the shirt." Lands' End understands that customer complaints are a treasure, and it utilizes them to enhance its offer. In the end, Lands' End becomes a brand you can trust.
For years, J.D. Powers has measured the quality of companies by using the quality of customer service as one of its critical measures. Recently, T-Mobile won in wireless for being responsive on the phone, in the stores, answering concerns and complaints quickly and effectively. What makes a J.D. Powers award noteworthy is that consumers help to determine the criteria for success.
But, as a brand, you don't need J.D. Powers to help you understand what matters to a customer. You need to only listen to their complaints. They will tell you very directly.
A pharmacy retailer had a number of private label products, provided by a third-party supplier. The retailer started to get a consistent complaint from one particular woman about its private label skin lotion. The woman had a cat who liked to lick the woman's arms. The cat started to get sick, and the woman deduced that it was the lotion that she had recently bought that had been the cause of the problem. Go ahead and laugh. The pharmacy retailer certainly did. The solution seemed obvious to most who worked there—don't let the cat lick your arm. However, one astute marketer asked, why were they just now getting that complaint? Doing a little investigation, it discovered that the formulation of the private label lotion had changed ever so slightly—enough to make the cat ill. That knowledge helped the retailer work with its supplier so that no more changes could be made to formulations, no matter how minor, without its knowledge and permission.
In this instance, a minor complaint led to a change in purchasing procedures for a company. One can only imagine what other "minor" formulation changes could have done over the years to people, or other cats. This was a complaint that ended up being a true treasure.
Behind most complaints is a bit of knowledge that can help to improve a product or service; a complaint can provide a deeper understanding of a customer's needs. Treasure those complaints—they will make your brand stronger.
Truth 16. Brand stewardship begins at home
You know that raising a child with values begins at home, or that education begins at home, but what about a brand? A brand's home is its organization. To build a successful brand, you must start at home. How can you possibly expect your customers to understand or be loyal to your brand if your own people don't understand your brand or brands? If your own people are not loyal?
Brand stewardship must have the commitment of the senior executives. If the executives don't recognize the importance of building their brands, that message will not be understood by the organization. If the executives don't stay true to the meaning of the brand, to its messaging in the market, why should the rest of the organization? With clarity from the executive team comes clarity for the organization about the strength and value of the brands.
It is so easy for executives to say that the brand is owned by marketing and to not take a strong stand in the stewardship of the brand. Yet, the importance of stewarding the brand by everyone is most directly understood when the executives take the lead in driving the brand. They set the example for the rest of the organization.
Importantly, brand stewardship must occur deep within the "soul" of the organization. Every employee, whether they directly interact with customers, must live the brand. The brand helps to shape the tone of the culture. As the culture is shaped, it then serves to reinforce and build the brand. So, the culture, the brand, and the employees are all directly related when it comes to delivering a brand experience.
Too many times we hear that the brand is just marketing's responsibility. But, the truth of the matter is, marketing is not the only group that touches the external market. So, every function that touches the external market must live the brand. If members of an organization cannot deliver the brand experience to each other, how can they possibly take it in an effective manner to the marketplace? Stewarding the brand not only must start at home, but it also must start by providing the very values the brand stands for to its own employees.
Marriott has made a name for itself in service. But service for Marriott isn't just what happens at the front desk. Service is how employees treat employees. It is embodied by J.W. Marriott, the founder, sitting down and listening to an employee's personal problem because of the deeply held belief that they must serve each other to effectively serve their consumers. By living the concept of service at Marriott, it becomes natural, and not another "to do" item on their list for the day.
Donatos is a smaller chain of pizza parlors that also provide delivery. Its brand tagline is "Respect the Pizza." But, let's be honest…pizza is pizza, right? Absolutely wrong—and Donatos understands that in spades.
Some friends ordered some pizzas from Donatos. As brand enthusiasts, we knew the tagline "Respect the Pizza." However, the group was absolutely flabbergasted at what happened at delivery. The delivery man showed up carrying the pizzas. As he handed them over, he asked, "Do you have plates?" We responded that we had napkins, so we were good. "Sir," he said, "Respect the pizza," and handed over several sturdy paper plates. The concept and the experience of Donatos pizza had reached all the way to the delivery person, who was now effectively stewarding the brand.
This was a wonderful experience. Here was a delivery man, with no one watching over his shoulder, advocating "Respect the Pizza" and offering plates because he respected the pizza. Isn't that always the telling story? What do your children do when you are not watching? How is your brand communicated when marketing is not involved?
What is powerful about this experience with Donatos is the totality of the messaging. Every aspect of the experience reinforced the message of "Respect the Pizza." We "respected" that pizza just a little bit more. The stewardship of the brand throughout the organization ensured that we clearly understood the brand.
Living your brand begins by understanding your brand, and then taking that understanding and applying it to every detail of the organization. Brand stewardship begins at the top. If your executives do not believe in the brand, and are not committed to the brand, why should your employees? Why should your consumers? Consider what your brand means and apply it to everything: the memos you write, the people you greet, and the vendors who call. Watch and see the brand come alive throughout the organization; watch it develop a life of its own; and watch the consumers become completely loyal to the brand. Respect the pizza.
Truth 17. Market share doesn't matter
Is growth desirable? Is market share a worthy goal? Most managers would answer unambiguously "yes." Actually, it depends. Growing profit margins and return on equity typically enhances shareholder value. Simply getting bigger does not. Over a recent five-year period, Nike added three billion dollars in sales, yet only forty million dollars of profits—that's top-line growth with little effect on profitability. The stock market does not reward simply chasing market share and sales volume unless such growth leads to greater return on equity, generating profits more efficiently.
A friend, an IT vice-president at a large company, was talking about his company's history of acquisitions. Over the years, his company added a number of smaller companies to its business. He was somewhat amazed that despite the company growing in size, the stock price remained relatively flat. His story, though, wasn't a surprise. Unless the company becomes more efficient at generating profits, simply getting bigger isn't going to increase shareholder value.
The misguided quest to get larger can lead to marketing decisions that reduce the sharpness of the brand. Starbucks and Dunkin' Donuts are encroaching on each other's turf. Dunkin' Donuts is pushing fancy cappuccino and espresso. Starbucks is opening locations in gritty blue-collar neighborhoods. Each brand risks diluting its core meaning. Starbucks is an inviting gourmet coffee experience, and its choice of locations is an element of creating the brand's meaning. Dunkin' Donuts provides good, basic coffee—it simply isn't a cappuccino and espresso kind of place.
With athletic shoe sales relatively flat, Nike's head of apparel wants to double apparel sales to six billion dollars in five years. The key strategy is to move beyond athletic apparel, treading on territory well covered by brands such as The Gap and Tommy Hilfiger by creating "must-have outfits." The general fashion industry is brutally competitive, and pursuing this endeavor dilutes Nike's association with athletics. To Nike, we say, "Good luck!"
The Wall Street Journal reports on the annual pursuit for the title of America's best-selling car—usually a battle between the Honda Accord, Toyota Camry, and Ford's midsize sedan—with rebates often used to generate sales at the expense of profits. Such thinking is not relegated to the automotive industry, as many companies use a variety of discounting and loading gimmicks to boost end-of-year sales figures. Investors and the market, though, care not for market share and sales volume. Investors care only about an on-going stream of positive cash flow—profits.
Recently, Wal-Mart earnings disappointed Wall Street. The culprits? Decreased profit margins from discounting to attract more shoppers, as well as Wal-Mart's failed attempt to increase market share by selling goods targeted to more affluent shoppers.
In addition to profit problems, growth can cause other concerns. Toyota has been extremely successful, rising to be the number-two auto brand (based on market share) in the U.S. (behind General Motors, and closing fast). But growth can bring problems. Toyota's J.D. Power & Associates quality ratings have dropped. And three of Toyota's models were recently rated "below average" in quality by Consumers Union.
Building a strong brand means that consumers see sufficient value in your offering that they pay a price that allows you to make a reasonable profit for your shareholders. Porsche and BMW are two of the most profitable brands in the automotive industry. Both are low share brands, concerned more with maintaining price premium via a strong brand image than they are with sales volume. They understand well that their primary responsibility to shareholders is profitability. Although clearly they have to operate at a sales level that ensures manufacturing efficiencies, they understand the discipline of brand building for profits. They avoid the allure of chasing market share.
Why this belief in the primacy of market share? In part, this belief stems from the power of economies of scale—as sales (and therefore production) go up, average cost per unit goes down. True…but these economies of scale are typically achieved quickly and at relatively low shares. In part, this belief stems from a perceived positive relationship between market share and profitability. But typically, market share doesn't cause profitability. Management skill and luck affect both market share and profitability simultaneously.
Lack of a nuanced understanding of market share and profitability relationships fosters a belief that market share per se causes profitability. Armed with this belief, companies will engage in market share-building activities (such as extensive consumer promotion or price discounting) that actually reduce profitability.
Extensive discounting and free service offers designed to pump up market share and customer counts attract the least loyal customers, further deteriorating the health of the business.
Such activity does not fool rational investors, who understand that unprofitable customers and market share built on profit-draining rebates don't serve their interests well. Investors don't care about market share. Profit is the nobler objective.
The myth that larger is better has been debunked but still thrives with many business leaders. The quest to get bigger can hurt a brand's image—and, in the end, isn't what really enhances shareholder value.
Truth 18. Avoid the most common segmentation mistake
Segmentation is a cornerstone of sound marketing and brand building. Segmentation is the forming of groups (of consumers) based on some criteria or characteristics. The usefulness of segmentation ties directly to how these groups are formed. Formed appropriately, segments can be a powerful organizing principle for brand development. Used inappropriately, segmentation can weaken your understanding of the market you compete in. The most common mistake is to segment based on demographics (age, income, education, marital status, and so on). Brand managers will say things like "our segment is young, upscale men" or "we've divided the market into three categories—low income, moderate income, and high income." Both cases illustrate segmentation by demographics. The first example is a bit more sophisticated, but it is segmentation by demographics nonetheless.
Segmentation by demographics fails to provide deep insight into the underlying dynamics that are affecting brand choices. If segmenting by demographics is not that useful, how should you think about segmentation? There are three particularly good ways to segment the market—by profit, by behavior, and by benefit.
Segmentation by profit recognizes that different people have different (financial) value to a business. A person can be valuable because they buy lots of your product or service. For example, a woman buying paper towels for a family of five likely buys a lot of paper towels. A person might be valuable because he or she is relatively insensitive to price and doesn't demand or expect discounts. A person might be valuable because his or her loyalty will generate revenue over many years. Segmentation, then, forms groups of people based on profitability. You can create as many groups as is useful for your business. For example, some banks use internal color codes "red," "yellow," and "green" to reflect the profit importance of customers. A high-profit "green" customer will (and should) receive preferential treatment. Implementing segmentation by profit requires detailed data on revenue and costs at the customer level—data not available in many instances.
With segmentation by behavior, groups are formed based on some unique behavioral characteristic relevant to the business. A retailer like Home Depot might group customers into several behavior segments such as "do-it-yourself renovator" (someone who takes on major renovation projects) or "weekend fix-it guy" (someone who makes minor home repairs on the weekend). These segments are formed by behavior, not demographics.
Segmentation by benefit is the third recommended segmentation approach. People vary with respect to what is the primary driving factor that influences their choice of brand. Consider automobiles. Some people most heavily value safety. For some, reliability is most important. For others, performance is the primary motivator. Consider jeans. In choosing a brand, some people are more focused on prestige. Some people value comfort. For others, low price is the primary consideration. Each of these examples illustrates a benefit segment.
Only after you have formed segments do demographics come into play. People in the "safety" segment for cars might tend to be female, 25–45 years old, married, with a household size of 3–6. The "weekend fix-it guy" segment might be characterized as male, 35–50 years old, suburban, with a household income $25–75,000. But notice that demographics are not used to form the segments, but rather to describe the segments after they have been formed.
Segmentation provides value in two ways—it improves both the effectiveness and the efficiency of your marketing efforts. By very clearly identifying your target group, you can gain deep insight into the motivations of that group—what advertising appeals will work, what types of promotions will be compelling, and what product or service features will be most attractive. You improve the effectiveness of your marketing programs.
Segmentation improves efficiency by focusing your marketing spending on the group of people who are most likely to be receptive to your brand message. Every brand has some limited budget for marketing and brand building. That budget might be as small as $3,000 or as large as $300 million—but there is some limit. Segmentation enhances efficiency by peeling away irrelevant (to your brand) people. Segmentation ensures that your limited resources aren't diluted—but directed in a way that yields maximum impact.
Demographics clearly are an important element of targeting. But starting the segmentation process with demographics fails to embrace more fundamental factors that are driving brand choice. People don't buy Volvos because they are "women, 25 to 45 years old." They buy Volvos because safety is the primary criterion in selecting a brand of car. People don't order Heineken beer because they are "urban, professional males." They order Heineken because they are at happy hour with their work colleagues and want to make a good impression.
In developing a targeting strategy for your brand, first identify market segments—either by profit, by behavior, or by benefit. Determine which segment is best for your brand to focus on. Which segment best aligns with your brand's image? Which segment is not well served by a competitor? After deciding the segment for your brand, describe the segment using demographics. Use demographics for describing segments, not for forming them.
Truth 19. Public relations and damage control: The defining moment
The fact is, bad things happen. Quality is left unchecked, and E-coli or lead poisoning occur. All of sudden, a brand's worst nightmare becomes a significant, real issue. Brands and companies get scared and utter those two horrible words, "no comment." Now is the time for brands to take the worst possible situation and create the brand's defining moment out of it.
Yes, there are positive PR stories every day, and the value of that third-party endorsement is immeasurable. The angst for brand managers, however, is the handling of the crisis situations. Often seen as serious threats to the life of the brand, negative situations are met with fear. However, when a crisis is confronted head on and put into the perspective of the brand's values, the crisis can be turned into a course-altering, defining moment.
When in a crisis, a brand has, very simply, two choices: Face the situation head on or avoid it. Crisis situations that gather media focus usually also cause legal teams to get involved. Legal teams are charged with protecting the company. As such, a recommendation of not commenting on a situation publicly is often standard. From a brand perspective, however, this is dangerous as it allows the media to form its own opinions of the situation.
A company known as Fig, with offices throughout the country, offered women a chance to lose fat through the unproven lipo-dissolve system. In a sudden surprise, it closed all its doors, having lost funding from its investors. The media had been running stories about women who were disappointed in their results. Fig refused to comment on results, and its story was not told. Its investors started to hear the concerns, and that, coupled with some other business issues, caused investors to lose confidence and pull all the funding. Perhaps there were no positive results to talk about, but that we will never know.
It is difficult to face a crisis head on, acknowledge it, and address it in the marketplace—but it works. The quintessential example for the decades is Tylenol. Its very public acknowledgment of the tampering issue generated an enormous amount of long-term respect for the company.
In a similar and more recent vein, tainted dog and cat food caused enormous concerns for pet owners throughout the United States. Some brands, such as Nestlé Purina and Iams, jumped when they heard this news, pulled product, generated media releases, and created sections on their websites for concerned pet owners. Despite the horrible situation, they maintained the trust of the consumers they served because they addressed the issue head on.
Taco Bell went through a significant E-coli scare. A number of stores served the tainted food, and within days, Taco Bell had closed nine of its restaurants. The restaurants stayed closed until the problem was isolated, eliminated, and the restaurants were safe again for the consumers. During that time, numerous reports went out to keep the public up to date. Taco Bell acted swiftly and, in fact, was complimented during the ordeal by the Chief Medical Officer of the FDA's Center for Food Safety and Applied Nutrition for its cooperative response.
When Taco Bell reopened its doors, the consumers came back. The trust Taco Bell built in the brand provided consumers with confidence that the problems were corrected and the food was safe again—a great example of a bad situation becoming a defining moment because of the actions of the brand.
Bad situations will occur. Some are the direct result of a company, and others occur due to distributors, contract manufacturers, and so on. When a crisis situation occurs, the brand must look for the opportunity to create its defining moment. Stand up for values of the brand and share those values with the marketplace through appropriate action. Create a brand opportunity to be known not for what happened, but for the brand's ability to live its values and do the right thing for its consumers.
Truth 20. Focus equals simplicity
Great brands are built on a foundation of simplicity. Simplicity is important for two fundamental reasons. The number of brands and brand messages consumers are exposed to is staggering. And consumers' motivation and ability to process all the information that engulfs their world is limited. Taken together, simplicity is the best hope of gaining the consumer's attention and communicating the meaning of your brand in a very cluttered world.
Although most marketing professionals agree on the importance of simplicity, having the discipline to embrace simplicity can be difficult. Simplicity begins with the message of the brand—and this brand message needs to be focused. Having a focused brand is the first, and perhaps most important, step toward simplicity. However, a focused brand message is not enough. Brand managers must be diligent and refuse to extend the brand to products that are inconsistent with the brand message. Simplicity gets diluted when brands are over-extended. Simplicity gets lost with inconsistent messaging.
Q-Tip focuses on the very simple concept "cotton swab." Imagine the difficulty of staying focused on that simple concept. Q-Tip managers have resisted the urge to extend the brand into such logical areas as face wipes, ear drops, gauze, cotton balls, and so on. By resisting these diversions and staying focused on the "cotton swab," Unilever has built a brand that consumers easily understand. Maintaining focus year after year under pressure to "leverage brand equity" actually enhances the value of the brand. Consumers understand what Q-Tip means. This understanding improves the likelihood of Q-Tip being the brand of choice for people looking for a cotton swab.
Consider that a consumer's mind allocates limited space for brands. Consumers will never remember everything, but they must remember enough to choose your particular brand. When it is time to make a purchase, can the consumer easily recall something relevant and distinguishing about your brand? When simplicity is at the heart of your brand essence, the chance of choosing your brand dramatically increases. The less a consumer needs to work to recall and consider your brand, the more likely you are to benefit with a purchase. After all, the last thing you want to do is have your customer work to remember you. Simplicity is the quickest path for a consumer.
Simplicity is not easily attained, however. It requires rigorous understanding of the brand essence and the ability to boil all of the many features and benefits of a brand down to one or two poignant points. On top of it all, once simplicity is achieved, listen for the nay-sayers. "Is that all?" "But that is so simple." "Anyone could have done that it is too easy." Don't be frustrated by such comments. Those comments are, indeed, compliments that the job of identifying the brand essence was done well. The fact of the matter is, achieving simplicity is not easy. Yet, when successfully accomplished, it seems so obvious.
Simplicity is about being direct and focused. Consider Jello. Watch it wiggle, see it jiggle. The simplicity of Jello is that it is fun. The advertising, the packaging, and the promotions all support this focused brand message. Again, the challenge for Jello's brand team is staying committed to this brand essence. With a product like Jello, much like Q-Tips, there are so many options for brand and product proliferation. However, focus and staying true to the simplicity of the brand promise keeps Jello a strong and timeless brand.
Kmart is a great example of a brand that lacks simplicity and, therefore, focus. Kmart started its deep decline a number of years ago. One can argue that its competitors, Wal-Mart and Target, had much to do with its decline. But, as you dig deep, you can see that Wal-Mart stands for inexpensive prices. A simple and focused message. Target stands for great design at value prices. Once again, focused and consistent. But, what can be said for Kmart? It competed on value for a while. It tried to be the one-stop shop as well. It took a stab at a more designer focus, but for the clothing only, not for the rest of its products. As it shifted its messages, it became anything but simple and focused. It became a muddled mess. What is a consumer left to do? When an inexpensive item was needed, the top name in the consumer's Rolodex became Wal-Mart. When a stylish item of good value was needed, yes, you're right—Target popped to the top of the consumer's list.
Focus your brand and strive for simplicity. This will connect with consumers. A direct connection with consumers is what makes brands great.
Truth 21. Marketing is courtship, not combat
War is often used as a metaphor for marketing. It's not uncommon to view headlines in the business press such as "Texas is Prime Turf in Truck War" or "ExpressJet Adopts Guerilla Marketing." Books such as Marketing Warfare continue to reinforce marketing as combat, with discussions of "flanking maneuvers" and "frontal assaults."
Such thinking is inevitably competitor-focused rather than consumer-focused. After all, war is essentially about destroying or subjugating the competition. Being competitor-focused leads to "me-too" imitation products (gee, if your competition offers this product, you should too), copying strategies (under the assumption that you don't know what you should be doing, but somehow your competitor does), and heavy discounting (often referred to as "price wars"). A competitor-focus encourages a myopic fixation on market share and sales volume rather than profitability, as market share and sales volume are more publicly visible metrics.
This focus on combat perhaps derives from the competitive nature of western society, perhaps from the competitive focus in business school, or perhaps simply from the natural tendency to compare how we are doing against others. The final arbiter in these battles, though, is the consumer. It is the consumer who "votes." It is through a focus on pleasing the consumer that you encourage the voting to go your way.
Consider the introduction of a new brand of pet food. National sales meetings are big events with at least one objective to generate excitement and enthusiasm among the sales force. One new brand was conceived and designed to specifically target one of the company's primary competitors. The CEOs of these two large companies were well known for their dislike of each other.
Outside the large meeting auditorium, a boxing ring was constructed. During breaks, two kickboxers sparred for the attendees. One kickboxer wore trunks emblazoned with the logo of the new brand, while the other boxer's trunks bore the logo of the competitor brand. The kickboxers battled with the encouragement of the growing crowd. Cheers and applause erupted when, inevitably, the new brand boxer KOed the competitor boxer.
Such theatrics make for great fun with the sales force. But the success of this brand comes not because of the management's desire to "knock out" the competitor. Rather, the success of this brand comes from the brand's capability to connect with its target audience, to create a compelling product offering, and to fundamentally offer a more powerful value proposition.
SABMiller competes closely with Anheuser-Busch. Miller has run a series of humorous ads directly targeting A-B. In one ad, a Dalmatian riding along in a carriage pulled by Clydesdales (visual references to A-B icons) sees a Miller beer truck with "Miller Lite has more taste than Bud Light" on the side. At a stoplight, the dog makes the leap from the carriage to the cab of the Miller truck. These ads, while very funny, tend to be targeted as much to the competitor (A-B) as the consumer.
Consider dating as a more appropriate metaphor for marketing. Dating is not about beating up your competition. Dating is about making yourself more attractive (physically, emotionally, and intellectually) so that the person whom you are interested in chooses you rather than his or her alternatives.
Successful dating involves getting to know well the person you are interested in. It is creating experiences that highlight your strengths and character, particularly those that will resonate well with desires of the other. If the person you are interested in enjoys cultural activities, an invitation to the symphony will be more enthusiastically received than an invitation to a bull riding competition. It's not at all about your competitors—it's about who you are and how well you match with the person.
And, so it should be with your brand. Consider your target audience. Market research can provide insight into their needs and how they see your brand. How can you make your brand more attractive? Advertising, price, packaging, distribution channel, personal selling, publicity, promotion, product, or service features all can work to romance your target audience.
Advertising can create an appealing personality around your brand, such as it has for the Mini Cooper. Distribution decisions such as type of retailers that will carry your brand can enhance your brand's attractiveness. Whether your brand is sold through Nordstrom or Wal-Mart affects its attractiveness. Either can be appropriate—it depends on with whom you are trying to connect.
Don't ignore your competition. However, first and foremost, put your eye on your consumer. By creating your brand as more attractive, demand will move in your direction. Importantly, this demand is not the result of what you have done to your competition, but rather what you have done for your consumer. Marketing is more courtship than combat.
Truth 22. Don't sacrifice brand focus for sales
Many brands become successful through clear focus on a particular attribute or benefit that is meaningful to their target customers. These brands typically show good sales growth when awareness of the brand and its attractive features draws in those people who find some affinity with the brand. Eventually, the brand reaches saturation—as appealing as the brand is to a particular group, there is always some natural limit to the sales potential.
When faced with slowing sales growth, management, with typical can-do spirit, seeks ways to continue growth. Such efforts often lead to expanding the appeal of the brand by moving it away from its well-defined focus.
The Saturn car company built a great brand based upon a unique no-hassle, friendly sales experience. Additionally, the models were all small, relatively inexpensive, and utilitarian. Saturn appealed to younger, practical, and economically-minded car buyers. This strategy successfully created a distinctive image for the Saturn brand and differentiated Saturn from other competitors, which had become increasingly indistinguishable.
Over time, Saturn's growth slowed and management began to look for ways to grow the brand. Often Saturn owners would trade out of the brand as they grew older and improved their economic status. The undeniable logic was to introduce a larger, more upscale model to provide Saturn owners with a trade-up option. The Saturn LS was larger, more luxurious, and more expensive than the other models—in other words, the opposite of what Saturn was known for.
The Saturn LS did not do particularly well. Not because it is not a good car, but because it was not consistent with the focus Saturn had built. Saturn's new convertible, Sky, seems to be a good addition to the Saturn line—attractive, small, and relatively inexpensive.
The entire concept of brand extensions centers on this very issue: whether to stay focused with a brand or extend a brand into new areas to build sales volume. Organizations couch this in marketing speak such as "we need to leverage the brand." At the heart of the matter is: Do you make changes to your brand that may impact its long-term viability to achieve short-term sales?
The answer is no. Don't sacrifice the health of your brand for short-term sales gains. Although it may help with meeting this quarter's numbers, expanding or changing the focus of a brand will cause long-term brand damage. That type of damage is hard to quantify and even harder to correct.
Consider the retail store brand The Limited, once a popular clothing store for young women. The Limited helped to usher in new looks in fashion at reasonable prices. Contemporary and stylish, it had an enormous following among teens and young adults. But, as sales pressures increased, and to meet opportunity beyond its current target audience, The Limited changed to meet the pressure of the current sales quotas. As a result of the shift in brand focus, the styles weren't quite as snazzy—they didn't meet the needs of the contemporary market. Additionally, it tried to extend its reach beyond its original target audience. It didn't take long before it wasn't clear what the brand truly stood for in the market. The Limited as a retail chain is all but defunct now. But, the lessons still strongly apply. Expanding a brand beyond its capabilities to achieve short-term sales can, in some cases, destroy a brand.
Starbucks same-store sales and share price have been declining. In a move to strengthen its core coffee business, Starbucks is discontinuing hot breakfast sandwiches. Starbucks makes great coffee—and this is the source of its profits. Leave the breakfast sandwiches to someone else.
Expanding a brand beyond its capabilities to drive additional sales is most tempting when the brand is doing exceptionally well. With Saturn, or The Limited, or any other hip, cool, and "in" brand, when performance is strong, the brand seems invincible. That, of course, is the exact point in time when the brand manager must take a strong stand to protect the integrity of the brand. That is also when energy is high and executives are convinced that much can be done to squeeze more volume out of a brand. It is precisely at that time, however, that you need to be vigilant so that the meaning of the brand is not sacrificed in the chase for sales.
Focusing on the long run is not always easy in highly competitive corporate cultures. However, too much emphasis on short-term sales increases can erode the value of the brand, causing larger problems down the road.
Truth 23. The medium is not the message; the message is the message
The Super Bowl is the perennial clash of NFL division winners. It has also become the Super Bowl of advertising. Advertisers bid up air time so that their brand is part of this media event. In recent years, Super Bowl thirty-second spots commanded in the neighborhood of $2.7 million. Yes, you read that right—$2.7 million dollars for 30 seconds of air time.
What do you get for that kind of money? Remember the GM robot nearly driven to suicide on his quest for perfection? What about the suggestion by Bud Light that using Rock, Paper, Scissors may not be the best way to determine who gets the last beer? And then there was the elderly man who had his first ever Coca-Cola and wondered what else in life he had been missing. Do you remember any of these ads even with these reminders? These ads were missing a compelling message. This was forgettable advertising whose greatest fame was its Super Bowl appearance.
Advertisers pay premium dollars to be a part of an event—the Super Bowl, the final episode of Seinfeld, and so on—believing that, in addition to a large audience, associating with such an event bestows stature, prestige, and significance. But without a compelling message, such spending satisfies only the company's marketing department, advertising agency, and perhaps the ego of the CEO.
To justify the expense, media experts will argue that the reach is so great with these events that they are worth the cost. But is reach the only thing that matters? There is no denying that it is important to reach your target audience. However, media experts know that it is a combination of reach (getting to your target) and frequency (the number of times your target sees and hears the message) that creates awareness and favorability toward your brand. In other words, seeing something once is not enough. In this cluttered world, people need to see, hear, and experience advertising messages multiple times before becoming aware of the brand and forming individual impressions of the brand.
Prime-time television reaches a large audience but at significant expense. Pontiac has decided to forgo this costly medium, and instead focus on less glamorous, but better targeted media that will better reach its target of younger drivers.
With major media opportunities such as the final American Idol show of the year, you get reach, but what about frequency? No doubt, millions will view your ad one time during the American Idol finale. But, is it worth the cost for one exposure? The medium is nothing more than that—a medium for delivering your message.
The Academy Awards is another major event for advertisers. The advertisers and audience, of course, are a bit different from the Super Bowl. Revlon, L'Oreal, and other cosmetic and fashion designers frequently advertise at enormous cost. But, when it is all said and done, what do people remember? Viewers of the Academy Awards may tell you what designer gown Nicole Kidman wore or which shoes Cameron Diaz chose for the evening. But, they may have a hard time remembering the messages of Revlon.
Perhaps the genesis of medium as message or of Super-Bowl-as-advertising-event was the introduction of the Macintosh in 1984. The commercial portrayed a young woman fleeing "thought police" as she propelled a large hammer toward a large video screen, smashing an image of Big Brother. This widely anticipated spot launched Macintosh as the irreverent alternative to the dominating IBM PC.
Although the Super Bowl helped Apple introduce its revolutionary computer to a huge audience, it was the message, not the medium, that differentiated Macintosh from its primary competitor—a message reinforced over the years across many media. A segment of consumers have developed a passion for Macintosh not because it advertised on the Super Bowl, but because of the symbolic image the advertising created.
Ego can get wrapped up quite a bit with these media. For companies that are committed to their brands, for individuals who support the efforts of the company, regardless of their role in the organization, it is with pride that they announce during a Super Bowl party, "Look for our ad; we tried to get it in the first quarter." When it is a leader of the organization whose ego is helping to drive the decision to make a Super Bowl or American Idol final show media buy, it is all the more difficult for the brand manager to articulate the lack of benefits in investing in the medium rather than the message. Facts should trump emotional business decisions any day. But, when ego is involved, that is a difficult challenge.
The medium for a message can be alluring—reaching millions, and generating prestige, stature, and significance to the brands that participate. It can be thrilling to be part of a significant event. But, the role of the medium is to deliver a message. Ultimately, in the end, the medium is not the message—the message is the message.
Truth 24. Brand development and the small business
Small businesses face particular challenges. Small businesses can face tighter cash flow, tougher access to capital, smaller budgets, and fewer specialized personnel. Often, people working at a small business are expected to take on several roles—some for which they might not be ideally trained.
The competitive marketplace does not, however, give small businesses a free pass. Small businesses face the same market challenges as their larger counterparts—how to best differentiate, who is the ideal customer, and what is the core meaning of the brand. Addressing these fundamental brand development questions is just as important, if not more so, for the small business.
St. Louis grocer Straub's has only four stores but understands well the importance of differentiation and focus. The grocery market is highly competitive with large chains like Schnucks, discount grocers Aldi's and Save-a-Lot, and specialty grocers such as Trader Joe's, Whole Foods, and Wild Oats.
Straub's secures a profitable spot in this challenging landscape through adhering to fundamental brand-building principles. It starts with a clear understanding of the type of customer that it wants to build its business around—higher income, professional, educated, and discerning. The rest of their business flows from there.
It locates its stores perfectly to match its target customers—stores in upscale neighborhoods. It's hard to differentiate on basic products—Heinz ketchup and Bounty paper towels are pretty much the same regardless of where one buys them. Straub's does, though, provide notably higher-quality fruits and vegetables. Professional butchers are immediately accessible to serve up any of the store's excellent meats or explain how long a two-pound beef tenderloin should be cooked. An extensive deli offers selections of fully prepared or partially prepared high-quality items perfect for busy professionals. Wine selection is extensive and tailored to the tastes of its customer base. Straub's responds to special orders and offers its own store account for payment. Regardless of how busy the store seems, checkout is magically quick and simple—lanes open up to accommodate departing customers. Straub's management has created a complete experience that is very attractive—not to everyone, but to a particular type of customer. By successfully differentiating in a way that is meaningful to higher-end customers, Straub's also has greater pricing flexibility and the capability to generate profits in a tough industry.
Differentiating to a new market takes developing a new and distinctive brand, as shown by AMS Controls, a family-owned business that specialized in making controllers that regulate and manage roll-forming machines. By focusing on this particular business, AMS Controls had developed credibility and a good reputation among both roll-forming machine manufacturers and end users. As it turned out, the technology and software that control roll-forming machines can be adapted to control metal-folding machines. AMS Controls began work on developing expertise in this application area and created a highly competent controller for metal-folding machines.
AMS Controls had a good product for the metal-folding market but faced two significant branding challenges. First, it was not known in the metal-folding market. Metal-folding machine manufacturers, primarily located in Europe, weren't familiar with them. End users, unless they also operated roll-forming machines, also weren't familiar with AMS Controls. Second, AMS Controls did not want to risk diluting the strong association that it had built between its brand and roll-forming expertise.
So AMS Controls developed a completely new brand name for its metal-folding controller. By developing a completely separate name, it keeps AMS Controls associated just on roll forming and gives the new brand an opportunity to build its own unique reputation in the folding machine controller market.
AMS Controls, like many technology-based companies, had a (bad) habit of naming its products with letters and numbers (such as its XL200 Series Controller). For this new product, AMS Controls wanted a brand name that had some inherent meaning to its potential customers in the metal-folding market. It chose the name Pathfinder because it captured the key benefit of the software embedded in the controller. The software will take any finished product and determine the optimal path through the metal-bending machine to minimize bends, speeding production and limiting waste.
With a solid product and a new brand name, it introduced Pathfinder to the metal-folding market through some of the basic marketing tactics proven effective in this industry—trade shows, product brochures, product demonstration, and personal selling.
Family-owned Corley Printing Company takes great pride in mastery of its craft. Although it has always been passionate about its business, it has recently explored ways to communicate that passion in very visible and tangible ways. Its parking lot has been repainted. In lieu of parking spots marked with typical straight lines and curbs painted in traditional yellow, Corley painted press sheet registration marks to indicate the parking spaces and painted its curbs with the press sheet color bar scheme (cyan, magenta, yellow, and black). People in the design and reproduction industry will instantly recognize these unique markings—and a simple thing like a parking lot is transformed into an expression of passion for the business.
The Straub's, AMS Controls, and Corley Printing Company examples illustrate that the keys to building a strong brand for small businesses are the same basic principles employed by successful larger brands—be clear on your target, develop meaningful differentiation, have a name that reflects something important about your brand, avoid brand extension, communicate brand passion, and design your marketing activity and brand experience to be relevant to your target customer.
Truth 25. Imitation is an ineffective form of flattery
Everyone loves success. And people love to imitate those who are successful—to drive the same model car that their favorite NASCAR racer fields, to wear the same shoe as a basketball star, or to mimic the hairstyle of a famous actress. Business people read books like Jack Welch's Jack: Straight from the Gut hoping to duplicate his leadership success.
Benchmarking is simply another popular variant on imitation. You measure your competition's performance on relevant attributes and meet (or slightly beat) their performance. Think of this as imitative incrementalism. You'll be just like your competitor (but a little better). Such strategy rarely leads to strong brands but rather to me-too brands with points of difference that are relevant to the company but not to consumers.
Pepsi One is a brand that has been struggling. The "One" refers to one calorie—as distinct from diet soft drinks that have zero calories. Although the meaningfulness of "one" versus "zero" calories seems elusive, Pepsi One's disappointing performance stems from a strategic marketing failure—imitation rather than differentiation.
Pepsi One's introductory advertising featured people on a rocking boat, with some drinking Coke, and some drinking Pepsi One. As the boat rocked back and forth, the cans of soda would shift from person to person. People were alternating sips of Coke and sips of Pepsi One without ever noticing the difference. This was Pepsi One's "big idea"—it tastes just like Coke.
Well, gee, if folks wanted something that tasted just like Coke, wouldn't they just order a Coke? Pepsi One is destined to follow a line of failed extensions (Crystal Pepsi, Pepsi A.M., and so on) because Pepsi failed to establish a meaningful point of difference. Imitation may be the sincerest form of flattery, but it doesn't drive sales.
One of the most successful airlines today is Southwest Airlines. During a time that saw the demise through bankruptcy or merger of iconic brands such as Pan Am and TWA, a small airline born in Texas grew into one of the few consistently profitable air carriers. Success came because of their novel approach to the business. Southwest trimmed amenities to offer lower fares to a segment of the market that valued price over a warmed-up chicken and rice dinner. Southwest served smaller airports with lower overhead. It flew only one model of jet to keep maintenance and training costs down.
Wisely not focusing solely on price, Southwest airlines hired enthusiastic, friendly flight attendants. Rather than putting them in the traditional navy blue suits so common in the industry, Southwest dressed their attendants in casual khaki outfits. Southwest focused on differentiating their brand in a way meaningful to its target customer.
Southwest's success has not gone unnoticed. Several of the traditional major carriers introduced brands designed to imitate Southwest's success. Both Continental and Delta attempted some version of the low cost fun ethos of Southwest Airlines. Although the failure of each was certainly due to a host of contributing factors, a fundamental failure to differentiate was certainly one reason.
Apple's iPod is far and away the dominant MP3 player. An early entrant to the market, blessed with Apple's superb design sense, ease of use, and coupled with iTunes, the iPod quickly became a hit. Creative Technologies and Microsoft developed their own versions of the iPod. Branded Zen and Zune respectively, neither has captured the imagination of the consumer nor seen great market success. Neither brought significant differentiation to their brand. Some of each was sold, no question, but neither offered people a strong and compelling reason to choose them over iPod. Even companies with the clout of Microsoft can't overcome insufficient differentiation.
Imitators often fail because they don't (or can't) imitate the full magical mix of their target brand. Sure, they can dress their flight attendants in khaki, but have they created a culture that reinforces fun and enthusiasm? Yes, they've benchmarked hardware specs, but is their product as elegantly designed?
Another reason imitators often fail is that they lost the powerful first-mover advantage. New innovative brands that are first in their market benefit from early association as a leader, the expert. Making inroads against these brands requires meaningful differentiation.
Finding your brand's differentiation is not necessarily easy—research, intuition, analysis, and creative insight can all help. Sometimes luck can make the difference. To set up your brand for best success, though, requires differentiation, not imitation.
Truth 26. Positioning lives in the mind of your target customer
Where does a brand exist? Does Tide exist in a particular place in a store? No, as that is where Tide the product (rather than Tide the brand) can be found. Does Starbucks exist on various neighborhood blocks? No, as that is where Starbucks the service is created. These are important differences.
Brand managers often think they own the brand—that they control it. Brand managers, however, are truly tasked with creating experiences that can solidify the message of the brand, the position of the brand in the consumer's mind. This can be startling for brand managers who want to feel a sense of complete control over their brand's positioning.
As a result, it is all the more important that a brand manager creates a total experience around a brand position through exceptionally consistent messaging. All the experiential factors, when done in a consistent manner, can help to infuse the customer's mind with clarity around the brand position. It seems obvious but is often forgotten or taken for granted. However, implicit in this idea of consistency is that the brand as a product or service must perform in a manner consistent with the messaging being delivered. There is no greater way to destroy a position in a consumer's mind than to have the brand not deliver as promised.
A brand exists in the mind of the consumer. And it is here that the brand struggles to find a foothold. Finding a foothold—getting the brand lodged somewhere in the brain—is the first step. The second step is building meaningful associations (images, facts) around the brand. Budweiser the brand exists in our mind within a network of related concepts (tradition, sports, Clydesdales, and so on).
Effectively building these associations requires taking actions consistent with basic principles of cognitive psychology and learning. Keep your brand message simple—as relatively inattentive minds can more easily process simple information. Be consistent over time—such consistency reinforces the link between your brand and other concepts you intend to associate with your brand.
Head and Shoulders shampoo has stayed true to the same simple concept—it helps treat dandruff—year after year. In doing so, the brand has established itself in the consumer's mind as associated with dandruff control.
But what if management suggests that a particular brand needs to grow another two share points the following year? The focus of the brand then feels confining. A natural inclination is to then expand the meaning of the brand so that additional share points can be achieved. But the brand team does not fully control the position the brand has; they merely influence it. Trying to expand a brand's position typically leads to confusion in a marketplace, not additional sales. So, to obtain the growth goals, just the opposite must occur. Tighter focus on a brand and stronger consistency in messaging can all help the brand to be more alive for the consumer, with share gains then to follow. Unfortunately, however, this is counter-intuitive.
Have you ever visited an American Girl store? Do you know a young girl who is amazingly enamored with her American Girl doll? Every experience and every touch point that a child has with this brand reinforces the brand message. The position statement for American Girl probably addresses sense of self, being true to your identity, and valuing the difference that outstanding girls have.
Flip through an American Girl catalog, and you see stories about the dolls, the lives they lead, and the activities they prefer. Your trip to an American Girl store is not complete without a stop at the tea room, where the young girl in your life has lunch or tea with their doll in a highchair at the table. During lunch, you might check out the cards that are conversation starters, with questions such as: "What one thing would you want to change about yourself?" The American Girl brand connects with self-esteem for young girls.
The next time you meet a seven-year-old girl, ask her about American Girl. The brand will undoubtedly live very clearly in her mind. American Girl, the brand organization, does a fabulous job of creating experiences and products that continually reinforce that very position in the mind of their target.
Brand managers create the position statement. They define where the brand should exist in the target's mind. But, ultimately, the only thing they can truly control are the various messages and experiences regarding the brand. The brand position does not live with the brand manager—it lives with the target audience.
Truth 27. The value of brand loyalty
Loyal customers are an important brand asset. Loyal customers represent a profit stream paying out over the years. This notion is referred to as "customer lifetime value" and is predicated on loyal customers representing a stream of revenue (and profit) over time. In some businesses, the value of a customer can be quantified by projecting expected revenue, costs (including acquisition and retention costs), and likelihood of retention over time. The lifetime value of customers can be increased by any combination of increasing revenue from that customer, reducing costs, and increasing retention rate.
Improving customer loyalty impacts both revenues and costs. Loyal customers generate more revenue in several ways. First, loyal customers tend to be less price sensitive—attracted to your brand for reasons other than price. Loyal customers give a greater share of their business in that category to your brand. (A loyal Crest toothpaste user might buy Crest 80% of the time, whereas a less loyal user might choose Crest only 30% of the time.) Customer revenue may also increase over time. Real estate agents (earning commissions) who nurture loyal clients will see their earnings grow as their clients trade up (buy and sell) increasingly to larger, more expensive homes. Loyal customers may also become brand advocates, generating positive word of mouth and thereby indirectly generating additional revenue via referrals.
Higher customer loyalty also helps on the cost side. Loyal customers with more experience with your brand typically will be more efficient to service. For customers returning again and again to the same printing company, there will be a history of working together and understanding of expectations and procedures that simply makes doing business together easier. Loyal customers will need less post-sale support. For example, loyal Microsoft Office customers, with years of experience with the brand, will need less technical support.
Consider the simple example of a residential heating and cooling company, Morgner Air Conditioning and Heating. Morgner fields a number of service technicians but prefers to have the same technician consistently service the same house. It is not unusual for a Morgner technician to service the same house across two, three, or four different owners. New owners will be inclined to continue with Morgner since they have experience with that house's systems. Morgner benefits because the servicing technician has years of experience at that particular location and knows the history and quirks of that particular system. Morgner offers attractive multi-year service packages—an easy choice for satisfied customers. Loyalty can work well for both parties.
In considering loyalty for your brand, it is important to distinguish behavioral loyalty from attitudinal loyalty. Behavioral loyalty is simply repeatedly buying a brand—regardless of the reasons behind that purchasing behavior. Attitudinal loyalty is an affection, a good emotional feeling, and a sense of commitment toward a brand.
Drawing this distinction is important because one can sometimes misinterpret behavioral loyalty for attitudinal loyalty. Large department stores, such as Macy's, Dillard's, and Belk, often rely heavily on special sales—with several weekends a month often featuring a themed sale. Tracking customer purchase activity could reveal a large number of loyal customers—but "loyal" only because they buy discounted merchandise during sales periods, not loyal out of a genuine commitment to that retailer. That's not to say that there aren't people with an underlying loyalty to these retailers—just that you can't always discern this from simply looking at purchase behavior over time.
A great example of attitudinal loyalty is a recent commercial for the Porsche 911. A grade school boy in class gazing out the classroom window sees a 911 drive by. After school, he rides his bike to the local dealership. All of about 11 years old, he asks to see the new 911. He sits in the car, barely able to see over the steering wheel. Getting out of the car, he asks the salesperson for a business card and says, "Thanks, I'll see you in about twenty years." The voice-over announcer says, "It's a funny thing about a Porsche. There's the moment you know you first want one. There's the moment you first own one. And for the truly afflicted, there's the decade or two that passes in between." When that 11-year-old boy returns twenty years from now, you can be sure it will be because of strong affection for the brand, not because of some special sale.
Strong brands have a customer base that wants to associate with the brand not because it is the cheapest or deluges them with special incentives, but rather because the brand provides value to their lives. Brands with a meaningful point of difference, brands that make an emotional connection with customers, and brands that foster attitudinal loyalty, promote loyalty not because of discounts they offer their customers—these are bribes for business—but because the brand represents something their customers are proud of. These brands are earning, not buying, loyalty. How is your brand achieving loyalty?
Truth 28. Quality is not an effective branding message
Quality is a great statement to make about your brand. It is even better when your customers make that statement about your brand for you. Having a quality product or service is not the end of branding efforts, but only the beginning. Quality just gets you in the game and brings your brand into consideration. Brands that are not delivering a quality product or service consistent with their price will disappear (think of the Yugo!).
Attention to quality is fine. Marketing managers get into trouble, though, when they believe that quality is the basis on which their brand competes in the marketplace. Brand managers too focused on a quality message send their brand adrift without much meaning.
"Our brand is the quality leader," they might say.
Or "our customers buy our product because of its quality," you may sometimes hear.
All of this may be true. But what business openly proclaims to have a shoddy product or mediocre services? Sure, Boeing builds quality planes…but then so does Airbus. Anheuser-Busch is definitely an excellent brewery…but so is SABMiller. This abstract notion of quality doesn't go far in differentiating brands. It can be difficult for brand managers to see clearly that their competitors' offerings are often of quality similar to their own.
If you and your competitor both offer a quality product (as is likely the case), why should someone choose your brand rather than your competitor's? What meaningful point of difference do you offer? What emotional connection have you made? What unique imagery have you built around your brand? Heinz and Hunt's both make quality ketchup. Heinz, however, has created a point of difference with "thick."
Quality means different things to different people. For some, a quality watch may mean "rugged"; for others, it may mean "accurate," and for still others, it may mean "high status." Quality is an abstract concept referring to many different dimensions of a brand's performance. An effective positioning is tangible, clear, and concrete. Concepts such as "fast," "reliable," "fun," "youthful," and "safe" vividly portray the key benefit delivered by a brand.
Quality is expected in a brand. Although the level of quality expectations varies by price (you expect a $800 DVD player to be of a higher "quality" than a $150 DVD player), consumers fundamentally expect a quality product. Most companies are operating consistent with basic consumer expectations around quality. (If not, they aren't in business long!)
"Quality" doesn't differentiate brands. The Nissan Maxima, Mazda Miata, Mini Cooper, Honda Civic, and Lexus LS460 are all "quality" automobiles. But simply noting they are all quality automobiles does nothing to reflect the different experiences each provides. The Honda Civic delivers on basic reliable transportation. The Mini Cooper represents a fun small car. The Lexus LS460 promises "the passionate pursuit of perfection." Each of these brands has its distinctiveness and is targeted to different people. "Quality" does nothing to reflect these differences and distinguish these brands from each other.
Why be so vigilant about avoiding quality as a branding message? Because it is an easy default. Positioning your brand's key message is a critical branding decision. Choosing an effective positioning requires making a tough choice from among good alternatives. Should a bank position on low rates? Should a bank position on individualized personal service? What about accessible ATMs? Or perhaps simplified e-banking?
Each one of those positioning alternatives will have its detractors. It is bad to compete on price. Personalized service will be too expensive to deliver on and isn't a key decision criterion for 55% of bank customers. Accessible ATMs as a positioning seems so 1990s. Positioning on e-banking doesn't create the right emotional bond with customers…and on and on. Inevitably someone will suggest positioning the bank on quality. How can anyone object to that? It sounds great and fits perfectly with the bank's mission and vision statements. But what does it really mean?
Quality in manufacturing is important. Quality in customer service is important. Having customers view your brand as providing good quality for the money is important. Quality is a way to be. It is not a branding message. Your branding message should communicate your brand's special uniqueness.
People need some reason to nudge their choice toward your brand. Quality is necessary for your brand to be considered, but it is not sufficient to warrant a purchase.
Truth 29. Effective use of celebrity endorsers: The fit's the thing
Pairing brands with celebrities is a time-honored tradition (Mark Twain promoted flour back in the late 1800s) and continues as popular practice. Top celebrity endorsers are not cheap, however. Catherine Zeta-Jones landed a $20 million T-Mobile agreement; Angelina Jolie signed on with St. John and Nicole Kidman inked with Chanel, each for $12 million. This shows how expensive such deals can be.
But are these high-priced spokespeople worth it? Do celebrities add value to brands? With smart strategy—possibly.
Celebrities can create caché around a brand. Budweiser Select, an upscale, urban brand, employed popular singer Jay-Z to give the brand a heightened sense of cool. Budweiser Select aired a TV commercial featuring Jay-Z and Dale Earnhardt, Jr. together in an exotic supercar, chasing female racing sensation Danica Patrick in a similarly fast automobile around the streets of Monaco. Using these contemporary celebrities (in addition to an equally cool venue) imbued Budweiser Select with a great sense of panache.
Effectively using a celebrity requires carefully matching the brand with the appropriate celebrity. Brett Favre and Peyton Manning, two top NFL quarterbacks, served as endorsers for different brands. Peyton Manning appeared in MasterCard commercials, giving "pep talks" directly to the viewer. The Manning moments covered "regular guy" issues like driving a minivan or starting a new job. These were very funny but seemed to have no meaningful connection to MasterCard. Brett Favre, on the other hand, was featured in a low-key commercial for Wrangler. In the ad, Favre, wearing Wrangler jeans, played a game of touch football with friends. The ad emphasized the comfort of the jeans. Favre was a great choice because his casual working guy image is a nice fit with the image of Wrangler. The brand (Wrangler), the celebrity (Favre), and the key message (comfort) fit together seamlessly.
Omega watches has consistently used a number of celebrities in support of its brand. The print ads are all simple, focusing on just the watch on the endorser. Omega's choice of celebrities—Formula One great Michael Schumaker, swimming phenoms Ian Thorpe and Michael Phelps, and popular golfer Sergio Garcia—all reinforce the performance image of the brand. Omega lists on its website "James Bond" as one of its endorsers—a relationship that has been enduring and has transcended the various actors that have played the Bond character. Consistent use over time helps strengthen the relationship between the celebrity and the brand.
Discount insurance carrier Geico's use of celebrities seems odd. A series of commercials feature regular Geico customers along with celebrities such as Charo, Burt Bacharach, Peter Frampton, and the Pips. The only common theme seems to be "past their prime." The ads make no obvious connections between the brand's selling message and the celebrity. Possibly the choice of these celebrities from the '60s, '70s, and '80s reflects Geico's intended target audience; however, Geico's other ads with the animated gecko and the cavemen seem to suggest a younger audience that would not connect well with the older celebrities.
Avoid using celebrities who are saturated with other endorsement deals, and be careful about celebrities already strongly associated with another brand. Tiger Woods has had endorsement deals with Nike, American Express, consulting firm Accenture, Tag Heuer watches, and Gatorade. Tiger's extensive product endorsement portfolio, in addition to his particularly close association with Nike, made Buick's investment in him as its endorser somewhat questionable. It is difficult to see a natural fit between Tiger and Buick.
Jerry Seinfeld is not overcommitted as an endorser, but he is closely linked with American Express. Seinfeld brings his brand of humor to shopping with American Express. This tight association between Seinfeld and American Express might have limited the effectiveness of Hewlett-Packard's use of Jerry Seinfeld in its campaign. The ads were an extension of HP's campaign that featured celebrities talking about their use of HP computers. As the celebrities talked, they made reinforcing motions with their hands that created visual effects that brought to life what they are talking about. Seinfeld's monologue for HP coupled with the reinforcing visual effects work well, as they tie to things we associate with Jerry Seinfeld (New York City, diners, and so on). However, Jerry Seinfeld will likely remain most closely associated with American Express.
One important word of caution should be noted here regarding a risk in using celebrities to pitch for your brand—bad celebrity behavior can be bad for your brand. Chanel and Burberry jettisoned endorser Kate Moss when pictures of her snorting cocaine surfaced. Nike quickly backed out of their relationship with Michael Vick as a result of Vick's involvement with dog fighting. Don't let a tarnished celebrity tarnish your brand.
Celebrity endorsers can be a significant investment for a brand. Make sure the celebrity is a good fit with the brand image. Make sure you can build a strong link between the celebrity and the brand. Make sure the celebrity is relevant to your brand's selling message.
Truth 30. Brand-building consumer promotion
Consumer promotions encompass a wide range of activity. Frequent flier programs—consumer promotion. Coupons in the Sunday paper—consumer promotion. Contests and sweepstakes—consumer promotion. Holiday sales, rebates, buy-one-get-one-free offers, special trial sizes—yes, all consumer promotions. Effectively using consumer promotions requires clarity around objectives, clarity around the target audience, and clarity around brand meaning.
Too often consumer promotions are used simply to temporarily boost sales. These promotions are typically bland coupon programs. Yet, there is so much more to an effective promotion. To be successful, the objective of the promotion must be clearly defined.
Promotions are designed to stimulate consumer behavior. As such, there are two fundamental behaviors that promotions attempt to shape. The first behavior is trial. The intent is to engage consumers and persuade them to utilize the brand for the first time. Price reductions, sampling, coupons, and gifts with purchase are some of the more common trial programs.
Repeat programs are the main tools for encouraging and rewarding loyalty. Repeat programs are designed to encourage a consumer to purchase more of a brand, with the expectation that with repeated good experiences, the consumer will become loyal. In-package coupons, BOGO's (Buy One Get One), bonus packs (more product for the same price), and frequent user cards are all common repeat programs.
McDonald's Monopoly game is a successful repeat program. The collection of monopoly pieces encourages consumers to return to McDonald's. Many of the smaller prizes in the Monopoly game bring customers back to McDonald's for their free soda or free order of fries. Heartland milk was trying to make inroads against their chief competitor, Oberweis Dairy, at a local upscale grocery store. Heartland was priced a bit less and needed to reassure potential customers that their milk was as good as Oberweis. Heartland brought into this retailer someone to pour small samples of their various milk products—whole, 2%, and chocolate—for grocery shoppers. Both McDonald's and Heartland were very clear about their objectives.
A clear understanding of your target audience is also important to effective consumer promotion. In a recent year, coupon flyers inserted in Sunday papers delivered 253 billion coupons. Percent redemption rates often hover in the single digits. Many of these coupons reach people who have no real interest in the featured brand. Price discounting may attract some new consumers (often least-loyal price shoppers) and reduce your margin from loyal customers who would buy your brand anyway. Is this really the best way to reach your target audience?
Thoughtful and creative promotions reduce such waste by focusing promotional funding in a way that connects most directly with the brand's target audience. All start with a clear portrait of the person with which the brand strives to connect. An autograph session with football star Peyton Manning would likely be effective at attracting moms bringing their kids, but probably not so effective at drawing higher-income professional men.
Vespa has been actively rejuvenating and updating their brand of scooters. The company is creating more of a hip, contemporary, young, urban, and somewhat upscale image for their brand. Vespa has been strategically displaying their scooters in retail establishments that fit well with a particular target audience. A Vespa was on display in Starbucks—but not all Starbucks. This particular Starbucks was located in a younger, professional, and upscale neighborhood. Vespas were also on display in a Mark Shale clothing store—a clothing store that attracts a predominately professional, upscale, male shopper.
Starbucks and Mark Shale were not Vespa sales locations—rather, they were places for promoting the awareness of Vespa and transferring the image of these retailers to enhance a positive impression of the brand. Vespa clearly understands its target audience—and its promotional activity reflects this understanding.
Consumer promotion can also be used to reinforce the brand's positioning. Breitling has been producing high-end timepieces for nearly 120 years. The brand has been built around an association with the aviation industry. Rather than use consumer promotion to discount the price of its watches (and risk devaluing the brand), Breitling's emphasis is on strengthening its positioning. Breitling sponsors the Breitling Master Cup, a well-recognized international aviation competition. The first successful nonstop around-the-world balloon flight was made by Brian Jones and Bertrand Piccard in the Breitling Orbiter 3. Along these lines, Marlboro provided consumers with an opportunity to save product proof of purchase codes to redeem for items from a western-theme catalog. This promotion nicely reinforced the brand's positioning.
Keep in mind that although consumer promotions have a role in brand building, they cannot replace advertising as a tool for developing strong associations around your brand. Marketing expenditures have increasingly shifted from advertising to promotion due to an emphasis on short-term, immediate results. Marketing managers like consumer promotions because the effects are quick, visible, and tangible. But don't believe that your consumer promotions are having the same effect as an enduring advertising campaign. Let your consumer promotion be a complement to your advertising—not a replacement for it.
Truth 31. Advertising built for the long run
Your advertising campaign's job is to create brand meaning. Repeated over time, your advertising forges a link between your brand and some key benefit or feature. Michelin's use of the baby in the tire reinforces the idea of trust. Associating with extreme sports communicates "youth" and "high energy" for Mountain Dew.
Using advertising to build long-term value in a brand is not a sprint—it is a marathon. It requires patience. It requires focus. It requires commitment.
Most importantly, it requires executions with legs. It requires a creative idea, reflecting a single-minded strategy, which can be extended for years. Advertising relying too heavily on clever execution rather than connecting with consumers around a simple selling idea is a one-shot wonder. Perhaps it gets your attention. Perhaps it makes you laugh. But has it really enhanced your affinity for the brand?
Anheuser-Busch produces some of the funniest advertising on air. Think back to Spuds Mackenzie, the ultimate "party animal." There was the guy always trying to get his friends' Bud Light by fruitlessly proclaiming "I love you, man." Frankie and Louie were the wackiest lizards to grace the airwaves. Four young black men had the whole country wondering "whazzup?" You have to love the ads with guys using the word "dude" to express five or six ideas depending on how they say "dude." All very funny. But what does its have to do with building a consistent, enduring, and meaningful image for Budweiser or Bud Light? "Bud Light—isn't that the brand with all the funny commercials?" is not the most compelling strategic message. To this end, Anheuser-Busch recently stated a need to include more messaging along with the humor in their ads—a move that should serve them well.
The Economist, a business and political weekly with a global perspective, has run a series of simple print ads. These basic ads featured just the brand name with a bold line like: "Think someone under the table," "Lose the ability to slip out of meetings unnoticed," and "Leave no answer unquestioned." These ads delivered a sound, strategic message that The Economist provides deep analysis of issues important to our times. "Think someone under the table" is a nice play on the more common expression that begins with "drink." "Lose the ability to slip out of meetings unnoticed" speaks directly to how The Economist readers will be more thoughtful contributors. "Leave no answer unquestioned" points to the extra insight Economist articles bring to bear. Because the foundation of The Economist's campaign is a potent brand idea (in-depth analysis), the ads have durability. The Economist ads have a subtle creativity—but, importantly, creativity that is linked to a selling message. And it is a selling message that is designed to resonate with a more sophisticated, urban, and professional target audience. Advertising relying primarily on a cleverness or humor but devoid of a selling message wears out their welcome much quicker.
Frankie and Louie, the Budweiser lizards, wore out. How many times can you say "dude" and still remain interesting? And in neither case is there an apparent selling idea. The Economist took a meaningful selling idea (in-depth analysis) and translated it into a simple but interesting campaign. A campaign for the long run.
Campaigns for the long run need a compelling selling message. Did you ever see that commercial where the older couple funds their retirement from change their guests drop in the couch? It was really very funny. You see they invite people over and force them to sit in the couch, which they then jiggle a bit, hoping that change will fall out of guests' pockets and into the cushions. But who was the advertiser? What does it say about the brand?
Here was another funny one: ranch veterans on horseback trying to herd hundreds of cats. The ads employed great production values—close-ups of grizzled cowboys talking about the challenges of rounding up feisty felines. In case you don't remember, this was an ad for systems consulting provider EDS. How ranch hands herding cats enhanced the brand equity of an information systems consulting firm is not so clear.
Funny is fine if it enhances the brand message. Little Caesar's pizza aired ads intended to be humorous. For example, one ad featured a pizza maker so proud of his extra pepperoni creation, he couldn't bear to sell it to a customer. Another ad showed how Little Caesar's extra big pizza makes even the Grand Canyon look small. These ads focused either on either the product itself (lots of cheese, extra pepperoni, unusual sizes, and so on) or on great value. For the Little Caesar's ads, the humor tied well to the selling message.
Creative advertising is great. For advertising built for the long run, the advertising needs to be creative in a meaningful way. There needs to be strong linkage between the brand and the selling message. Otherwise, you have entertained your consumer, but have failed to add value to your brand. Absolut Vodka very creatively integrated their bottle into their selling message. Absolut Elegance featured the bottle with a black bow tie. Absolut Perfection showed the bottle with a halo. The Absolut ads were memorable for creativity and for communicating a sense of specialness—and versions of these ads ran for many years.
Is your advertising clearly speaking the fundamental truth about your brand? If humorous, is your advertising still delivering a relevant strategic message? Do your ads reflect a core concept that has longevity? Is your advertising built for the long run?
Truth 32. A service brand is a personal brand
Some people draw distinctions between "products" and "services." Products are more tangible and physical—shoes, luggage, computers, and beer. Services are usually less tangible—banking, insurance, and interior design. This distinction between the two can sometimes be blurry—a restaurant will have both more tangible (menu items) and less tangible (professionalism of wait staff) attributes.
Delivering a positive customer experience is not always easy—and is sometimes more challenging for brands that are more typically considered services. Controlling the customer experience for products can be easier because a variety of engineering, manufacturing, and quality control resources can be focused on a relatively few number of plants and production sites, ensuring a relatively consistent offering. A customer's experience of the brand is linked closely to the capability of the production process to deliver a finished product in line with expectations.
For services, a customer's experience with, and connection to, the brand is not the result of what happens in the factory. Rather, the experience with the brand is directly tied to interactions with one or two people who represent the brand and deliver the brand's promised value. And there may be thousands of individuals scattered around the country (or world) all tasked with delivering the brand promise to customers.
Regis salons are conveniently located in shopping malls around the U.S., Canada, and Puerto Rico. Regis offers better pricing than higher-end salons and yet still promises fashion-knowledgeable stylists able to work well with its clients' hair. This is a compelling proposition for a certain segment of the market. When someone walks in for a cut, their view of the Regis brand will be based significantly on their interaction with their particular hairstylist and the quality of the cut that the stylist delivers. To this customer, advertising no longer matters. The website no longer matters. How close Regis is to where they live no longer matters. What matters is the service delivery of that one stylist. Customer perceptions of the Regis brand are inextricably linked with the experience delivered by their stylist.
Mark Shale, with stores in Chicago, Dallas, Atlanta, Kansas City, and St. Louis, is a clothing retailer carrying brands such as Robert Talbott, Zanella, Canali, and Tommy Bahama. One of Mark Shale's top salespeople is a woman who works at their St. Louis location. Shelly works hard at establishing good connections with clients and prospective customers. She has a wonderful fashion sense—great for advising men. She is very patient and responsive in working with sometimes-demanding higher-end clients. Shelly maintains her customer database and provides sales alerts. She offers wardrobe consulting and, having learned the style preferences of her clients, identifies items that would be particularly attractive to them. Much of this is simply good salesmanship, although Shelly fully engages with providing good value to her clients. She has accumulated a number of loyal clients. For them, Shelly is the Mark Shale brand.
Boa Construction does very high-end new construction and renovation projects. Boa Construction has access to the kind of craftsmen, materials, and project management systems expected of a high-end contractor. One area, though, that Boa pays close attention to is the character of the laborers who work on its job sites. Boa often sends workers into clients' homes for renovation and remodeling projects—a disruptive and sensitive process under any circumstances, even more so given the nature of its clientele. Boa wants its on-site workers to be very courteous and respectful, taking extra care to minimize the inconvenience of their presence. Not all carpenters, electricians, and painters have the demeanor to work effectively in that environment. Boa Construction understands that the value of its brand is more than just the quality of its finished product, but rests as well in the way the finished product is delivered. It rests in the personal on-site interactions between its workers and the client.
How does a service brand, particularly one with far-flung locations, ensure the kind of personal brand delivery that leads to success? Hiring and training are certainly important in ensuring excellent delivery of the brand experience. Starbucks provides substantial training for its baristas to ensure both consistent product knowledge and good customer relations. Hire for passion about your brand's mission. When in an Apple Store, you sense that the people working there aren't just interested in some position in retailing; rather, they are there because of their enthusiasm for the brand.
With service brands, front-line folks are the face of the brand. These are the people charged with delivering the experience of your brand. The perceptions your customers have of your brand will be shaped by the personal interactions that occur. It is important that these vital employees understand and embody the spirit of your brand. A service brand is a personal brand.
Truth 33. Is your brand the best at something? If so, be satisfied
The brand that establishes itself as outstanding in a certain way is fortunate. Examples abound: Volvo for safety, Apple for creative computing, and Brooks Brothers for traditional male style. Brands such as these have established a wonderful reputation in a particular domain.
Management, eager to grow sales, often view such specialization as limiting. Yet pushing a brand beyond its expertise dilutes its focus. Apple tried to expand its appeal to corporate customers—with little success. Brooks Brothers tried to expand its brand to female clothing—with little success. Volvo has muddled its advertising message with a greater emphasis on stylish appearance. But there were already computers well accepted by corporations, retailers specializing in traditional styles for women, and most every auto manufacturer strives to build a stylish automobile.
All too frequently, management takes for granted the halo of being the "best" in a particular area. However, to be considered the best in a category, much must have gone right. R&D must have developed a superior product. Marketing must have clearly communicated the benefits. Sales have probably grown consistently, and typically share leadership is accrued to the "best." On top of this, to be the "best" indicates years of consistency. One does not become the best at something overnight. So, all of these various components, from research to manufacturing to marketing to sales, have been operating in a consistently strong manner for years to develop a company's brand into the "best" in the category.
Why then, do executives toss aside the mantle of being the "best" so easily? Because in business, the best is never enough, or so they fear. Who will be better than them next year? Unfortunately, it is that very fear that causes changes to a brand portfolio. It is fear that drives management to leverage a strong existing brand into another category. On top of that, business is not about being satisfied. Business is about growth and capitalizing on opportunities. However, that is often contradictory to effective brand building. Brands that are the "best" in a category need to work all the harder to stay focused and not allow a chase for growth to dilute the brand.
Consider Kraft. For years, cheese was spelled K-R-A-F-T. Then an acquisition or two happened, and some product proliferation occurred. Before long, Kraft no longer stood for cheese—it stood for a large food company that made all sorts of food products. Sargento jumped on this shift and started to capture the cheese market share once held so dear by Kraft. By messaging that Sargento was all cheese all the time, it took that mantle of "being the best" from Kraft. There is no denying that Kraft is a fabulous company. With acquisitions and growth come some difficult decisions. In this case, Kraft wasn't satisfied with being the best at cheese, and that opened the door for other brands to take that mantle.
Jaguar came to represent elite British elegance. To compete in more segments of the market, Ford acquired Jaguar in 1989. To its credit, Ford did much to improve on the spotty reliability record of Jaguar. But corporate pressures to boost sales of Jaguars led to some questionable model decisions. The X-Type was developed as a low-cost entry car. Considered by Time to be one of the 50 worst cars of all time, the X-Type was viewed as little more than a spruced up Ford—and then came the station wagon version! Ford was unwilling or unable to let Jaguar be the best at what it could be—a stylishly elegant British driving experience.
David Yurman is a jewelry designer who has captured the hearts of many women. Known for truly distinctive designs in jewelry, David Yurman is a strong favorite of the very well-heeled woman. What David Yurman has not done is to develop a line of clothing or perfume for this same target. David Yurman understands what he is best at—jewelry design—and has stayed focused on that. This is not to say that the company hasn't seen strong growth, for it has. However, that growth has come by continuing to hone its jewelry designing skills and not by moving into new market segments. The more focused David Yurman is on jewelry design, the more intriguing the products are, the more that well-heeled woman will buy, and the greater the growth for the David Yurman organization. Being the best is not something this firm takes lightly.
Michael Jordan, arguably the best basketball player in history, returned from a short career in minor league baseball to…well, play basketball again! Don't take a brand that is the best at something and send it off to compete in another sport…it will languish in the minors.
Use your company's limited resources to continue to improve the brand to compete where it is already the best—make your car even safer, make your computer even better for creativity, continue to reinforce traditional male style. Be the best at cheese; develop the ultimate jewelry designs. Don't be too quick to toss the mantle of "the best" aside. Be the best at one thing…and be satisfied. What can your brand be the best at? Knowing this is the first step.
Truth 34. Great positionings are enduring
The positioning of your brand is one of your most important branding decisions. The positioning is the primary association built around your brand. If consumers know nothing else about the brand, you hope they will know the brand's central meaning. The brand positioning communicates the brand's point of difference and is a primary way of connecting the brand with its target audience. A good brand positioning is built through consistent communications. A good brand positioning is enduring.
Apple introduced its Macintosh personal computer in the mid 1980s. Billed as "the computer for the rest of us," the Mac heralded an era of easy-to-use computing. The Mac's graphical interface brought intuitiveness to computing. This basic notion—"Macs are easy to use"—has been a fundamental mainstay of a brand now moving into its third decade. Early in the brand's history, Apple aired a commercial featuring two business people poring over DOS manuals, trying for hours to get their computer running. Finally, a third co-worker suggests that maybe they should just get a Macintosh. Apple also has run a campaign featuring two guys—one who personifies Windows and the other Apple. The two guys playfully banter back and forth—the underlying message in each of the ads is Apple computers' ease of use.
Allstate Insurance was founded in 1931. In 1950, they introduced the now-famous slogan, "You're in good hands with Allstate." Sometimes shortened to "You're in good hands," this tagline creates a feeling of comfort and confidence—highly relevant associations for an insurance company. Allstate found a positioning around comfort and confidence that has endured for half a century.
In business since 1910, Hallmark has tied their brand closely to the emotion around sharing warm feelings through greeting cards. The association between Hallmark and the emotion of caring was reflected in their tagline, "When you care enough to send the very best." This line was first penned in 1944 and served them well for many years.
Jack Daniels has created magic around their brand through its homespun, nostalgic association with Lynchburg, Tennessee. Brand advertising and their website use black-and-white photography and old-fashioned typefaces to reinforce the brand's link back to an early time. When connecting the brand with its birthplace, Lynchburg, Tennessee, Jack Daniels adds "population 461" to again reinforce its small-town, rural roots. One ad featured the headline, "The same since the '60s. That would be the 1860s." Jack Daniels' positioning has been enduring (and endearing).
Wheaties cereal is over 80 years old. In 1933, the brand began its link with sports through sponsorship of minor league baseball broadcasts and in-park advertising. The brand's sponsorship of these broadcasts grew rapidly as Wheaties supported more teams and more stations, extending its reach across the country. This tie to sports was embodied in the Wheaties tagline, "Breakfast of Champions," and the brand added testimonials from such baseball legends as Babe Ruth and Jackie Robinson.
In the '50s (that would be the 1950s), consumer research led the company to move away from its sports positioning and focus the brand on kids—certainly children were prime consumers of cereal. The brand partnered with the Lone Ranger and the Mickey Mouse Club, natural alliances for a brand with this new target. However, this strategic decision was a blunder for the brand (don't let testing override judgment!), with sales at one point dropping 10% in a year. In 1958, Wheaties re-trued its compass and returned to the positioning that had built the brand. Wheaties continues this day to reinforce this sports/fitness positioning.
Great positionings have longevity. But, the brand must deliver on the positioning for the positioning to be credible. Apple has to continue to ensure that their computers are easy to use. Wheaties needs to maintain the good nutritional value of its cereal. Allstate must guarantee that its customers are, in fact, in good hands should misfortune arrive.
The positioning should have longevity, but the brand's tagline can change. With the preceding examples, it is the brand concept (Apple and easy to use, Hallmark and warmth of sharing emotion, Allstate and comfort/confidence, Jack Daniels and rural nostalgia, Wheaties and sports/fitness) that is the positioning. The slogan or tagline is the creative reflection of the positioning. The tagline may evolve to stay contemporary and relevant while the brand concept, the positioning, endures.
What is your brand's positioning? Do you have the discipline to stay true to that positioning over decades?