New Facebook strategy - an Orwellian brand nightmare

OK, so I think I get it - Facebook is
  • Launching company brand pages where people can sign up as fans and have that information fed out to their contacts
  • Launching a service where people who shop at certain third party vendors can have that shopping information fed back as advertising to their contacts
  • Launching a marketing research service that serves up all the collective information about brands and those who prefer/use them
Facebook CEO Zuckerberg thinks that this is the wave of the future...a form of trusted referrals from friends to friends. But let me tell you, this is the beginning of a nightmare for Facebook from which they will never wake up. Somebody once said that no money can be made on the Internet, and they were right from the standpoint of the Internet user -- people don't want to be spammed with ads online. Having ads shoved at you from your dozens of "contacts" is not going to do anything to make Facebook more valuable or the companies advertising more popular. Instead it will just increase resentment and people will run away from Facebook.

The thing about trusted referrals from friends is, it's a noncommercializable phenomenon...and people these days are ever more suspicious of commercialized recommendations.

Plus, it's very Big Brother to be tracking what people do online and then broadcasting it to the world. I know kids these days don't want their privacy, but still. There's a limit.

The bottom line is: people get the information they need by Googling it and maybe clicking on Google's sponsored ads. They ignore the information you shove in their faces.

Bad move, FB.

Should brand consultants serve as policy advisers?

In a November 6 interview with the Council on Foreign Relations, Simon Anholt, who coined the term “nation-branding,” says advertising is an “utterly futile” way to change perceptions of a country and instead argues that countries should change the way they operate first.

The traditional way of marketing a country is way off, says Anholt, with tourism boards, investment-promotion agencies, government public diplomacy agencies, etc. giving out different messages. “It’s not very surprising that most countries end up with very fragmented, out of date, confusing, unhelpful images,” he says. “So I suppose the primary principle I tried to introduce here with the original idea of nation branding is that if all of those stakeholders work together and try to agree on some kind of common long-term strategy for the country and its role in the world, they’re far more likely to be able to influence the way it’s perceived.”

Anholt does not do advertising. Rather he serves as a kind of policy adviser “to the governments of, at any given moment, seven or eight different countries. I work with a small team consisting of, usually, the head of state, two or three ministers—foreign affairs, economic affairs, culture, and so forth—the head of the tourism board, a couple of chief executives of major corporations, particularly if they export, and one or two figures from civil society….We try to work out a plan for how the country can position itself in the world, and what are the policies and innovations and investments the country needs to undertake to earn the image it feels it wants and desires.”

About advertising, Anholt says: “People believe what they believe about countries because they’ve believed it all their lives and they’re not going to change their minds because a twenty-second ad on CNN tells them to. People immediately recognize that kind of communication for what it is—propaganda—and they will instinctively reject it or ignore it.”

While in theory Anholt’s approach makes sense, I find the idea of a communications person serving as a policy adviser frightening at the very least. It is like building policy based on what will make a country popular rather than based on what will make it effective in the world. I also think his approach undervalues the traditional tools of marketing communications significantly. Brand experts are primarily marketing communications advisors, not policy makers, and they should restrict themselves to the communications arena. That said, if a country is embarking on a policy that seriously damages its image in the world, it is not out of line for a brand consultant to mention it.

One also wonders what countries Anholt is consulting to…I assume they’re not rivals are they? In general, what about the issue of conflict of interest?

Brand Lessons from RAND’s “Enlisting Madison Avenue”

In a fascinating 2007 study, “Enlisting Madison Avenue,” RAND analyzed (pp. 57-129) how the United States military could better influence indigenous populations in Iraq, Afghanistan, etc. I thought readers of this blog might find it interesting to read some of the key ideas from that report and how they could be applied to any environment. (This is a sort of circling back from business, to government, to all settings.)

  1. Know your target audience through segmentation and targeting. This means using research to identify key stakeholders (by demographic [age/gender/income/occupation], psychographic [social class, lifestyle, personality], geographic location, behaviors) and crafting communication strategies that are relevant to each.
  2. Apply business positioning strategies. This means coming up with a core message—a message to emphasize—not emphasizing everything. Start with opinions or concepts held by the customer and work those into messages that come from you.
  3. Understand key branding concepts. This means understanding and leveraging the reality that people have certain associations with our organization and creating a unique and clear identity for them to catch on to. “Align every brand-consumer touchpoint to convey a single, clear, and uniform message.” You also need to continually update your brand to keep up with the times.
  4. Synchronize the brand. This means focusing your “brand architecture” so that you either apply the corporate name to all of your divisions, programs, and products, or reserve the name for distinctive use and promote various subbrands without the corporate brand name.
  5. Synchronize the workforce. This means making sure that employees properly convey the image you want to represent to the public. This also means answering complaints quickly, inventorying all brand-customer touchpoints and determining how people should conduct themselves in all interactions with the public, and educating the organization about your brand and how to manage and maintain it.
  6. Promote customer satisfaction. Make promises that you can keep. “When promises go unfulfilled, customers become disappointed and their likelihood of doing business with that company decreases.” Along these lines you should empower customer service representatives to solve problems and should make it possible for people to route their calls to the same representative who first took their call.
  7. Listen to the customer. “The most successful business endeavors are those that are premised on meeting customer needs.” You also need to monitor outcomes – stay in touch with customers “so that problems can be fixed before they alienate the customer base.” You should survey the public regularly, monitor complaint lines, etc.
  8. Harness the power of influencers. Reach out to “those in society whose position affords them a megaphone and the respect and admiration of key population segments.” These include the media, writers, bloggers, academics, celebrities, etc. This also means reaching out to customers who are very positive about their experiences with the organization and inviting them to share their experiences with others – perhaps via a blog. In any case you need to establish outreach to the community through regular interactions with people who are “customers” and make them feel like they are part of the organization’s “family.” You could also allow employees to blog online, within limits, about their insights and experiences.
  9. Use the principles of social marketing to achieve success. Social marketing “applies well-grounded commercial marketing techniques to influence noncommercial behavioral change in a target audience.” These techniques include knowing your desired behavior change; focusing on population segments most likely to respond to a behavioral campaign; determining concrete goals and objectives; knowing your market and the competition, if any; designing a product “just for them” (the audience); making prices “as low as they go”; placing the product effectively (location, location, location); creating motivating messages that stand out; getting the message out; and monitoring and evaluating campaign success.

Brand momentum strategies released, but methodology for brand value determination still unclear

Landor Associates and Stern Stewart's BrandEconomics unit released on November 1 the results of its third Breakaway Brands Study. The study analyzes brands that "exhibited sustained, quantifiable growth over a three-year period, delivering brand-driven value to the bottom line between 2003-2006." It includes about 2,500 brands from Young & Rubicam's BrandAsset® Valuator database. (Some brands, like Yahoo!, are excluded from this database, says Fortune (11/12/07), and they include "nonprofits and media firms with their own distribution channel -- whatever that means.)

Top Brands

Nevertheless, the top 10 momentum brands, ranked in descending order by value gained over the three year period, include:

1. General Electric
2. iPod
3. Microsoft
4. Blackberry
5. Samsung
6. Costco
7. T.J. Maxx
8. Barnes & Noble
9. Propel
10. Stonyfield Farm

Key Findings

Three key findings from the study, says Landor, include:

1. It is important to engage customers through branded experiences. "Samsung, Barnes & Noble and TJ Maxx have each leveraged deep customer insight to deliver uniquely relevant and engaging in-store and online experiences to consumers old and new."

2. Partnerships can help to build the brand. "BlackBerry built strong relationships with virtually all of the national telephone companies to attract independent subscribers, while Gatorade’s Propel and Apple’s iPod also saw growth through partnering strategies."

3. Businesses that are brand-centric have greater brand success. "Even mighty industrial and technology giants like GE and Microsoft have demonstrated they can accomplish significant cultural change through brand-driven initiatives, while yogurt maker Stonyfield Farms has retained and even enhanced its core brand persona despite coming under the wing of a global food giant."

Fortune notes the importance of corporate social responsibility to the top-ranked brands. For example, Microsoft's brand has been bolstered by its "kinder, gentler" image..."the company's image as a fierce, rapacious monopolist has faded" while General Electric's brand growth "is attributable almost entirely to its environmental efforts."

Brand valuation still unclear

Personally, one thing that still confuses me is how the value of a brand is determined. I went to the Landor web site and learned that BrandEconomics uses an "economic value added" framework to determine brand value. The site says that "EVA involves deducting a charge from post-tax operating profits that represents the opportunity cost of all the capital employed by the business. The capital charge represents the minimum return required by the providers of capital to the business; whatever a company produces over and above this represents an excess return on the investment." The company also uses "Young & Rubicam Inc.’s Brand Asset Valuator (BAV®)...the world’s largest database of consumer attitudes towards individual brands."

I would like to know how EVA and BAV work together to yield a number. Fortune says that Landor starts with BAV then turns to the financial calculations, but this is not specific enough. This is the crux of everything related to brand--and it's still murky.

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