Monday, January 28, 2008

Leaders apologizing and branding

Financial Week has an article (January 28) about apologizing and members of the C-suite.

"Mattel’s Robert Eckert apologized for lead-tainted toys; JetBlue’s David Neeleman for letting passengers rot on the runway; and Apple’s Steve Jobs for uneven iPhone pricing."

Why are business leaders apologizing so much?

The article answers that "Branding 101 taught us all that a brand is more than a product name or a company logo and that loyalty can’t be bought with an ad. Brand loyalty is a gift from customers to companies that consistently earn their trust and demonstrate credibility over time. It can also be taken away at any time."

What this means is that consumers are ever-ready to withdraw their trust from brand leaders and take it elsewhere. It is upon brand leaders, therefore, to consistently demonstrate that they are worthy of brand trust.

The article tells leaders to be always mindful of whether their communication is good for the brand. Not only that, leaders should open up two-way modes of communication such as customer advisory councils and even a CEO blog.

The article concludes with advice to make sure that "every executive, manager and employee in the company understands what is important to customers and that every meeting ends with one question: “Will this decision help or hurt our brand?”

I think it is important for leaders to be ready to apologize when they do something that violates the brand. Apologizing restores the lost trust between the consumer and the company that could otherwise be expressed in hostile blog or YouTube posts. It is good business.

Wednesday, January 16, 2008

Employer branding and Generation Y (well, all generations)

The Caymanian Compass features an article about employer branding and Generation Y.

The article notes that a 2004 study by Deloitte Consulting LLP and the Institute of the Future found six basic workplace values that this generation holds. These are:

1. More loyal to the same company than Gen Xers
2. "Craves a sense of purpose and meaning"
3. "Desire access to mentors"
4. "Want to work in a tech-savvy environment"
5. "Open social networks...are important to them"
6. "Work-life balance"

How does this translate into branding?

Deloitte uses the “Develop–Deploy–Connect” model:

1. Develop people by offering "real-life learning opportunities"
2. "Deploy key individuals by working with them to identify...deep rooted skills, interest, and knowledge, and then use that information to help find the best fit"
3. "Connect them by providing the tools and guidance they need networks"

The article cautions that "your employer brand must reflect" this model, noting that branding "can't be done simply by communicating a set of ideals, particularly for the cynical Gen Y group that has been bombarded by advertising messages all their lives."

Rather, employer branding "comes from the actual practices that make up an organisation." These include:

1. "The products and services you offer"
2. "Workplace culture"
3. "Points of differentiation from competitors."

I'm not sure that I see how the "develop-deploy-connect" model has anything to do with branding, but I do agree that branding is more than just providing a series of messages. The brand has to live in the product/service offering, in the culture (through vision, mission, and values) and in positioning (points of differentiation). But here again, I'm not sure I see the difference between the product/service offering and points of differentiation--to me these are one and the same. So the brand lives in the culture (which can be the unique way that the organization develops, deploys, and connects) and the positioning. And this is true not just for Gen Y, but for all generations.

Which brings me to a book I just finished reading. It's called Brand From the Inside, by Libby Sartain and Mark Schumann. The book purports to tell you how to build an employer brand, through eight steps. But I thought this book was a lot of nonsense gibberish. I didn't get the message at all. The authors don't provide one single concrete example of employer branding that makes any sense to me, with the exception of FedEx's "Purple Promise" and the "Freedoms" that Southwest provides to its employees. Plus they repeat themselves over and over again.

Here are some examples of the vague advice this book gives:

1. "Your employer brand must define what your business needs from your employees." (p. 31)Well, duh! But why not just call it the overarching brand and have employees contribute to that?

2. "Your employer brand must define on-brand behavior." (p. 36) Again, duh! What do you think an employer brand should do, define off-brand behavior?

3. "Your employer brand must connect what happens outside to what happens inside." (p. 37) This advice is just silly. There is only one brand, and it connects everything.

After reading this book, I am starting to think that the concept of employer branding makes no sense. There is not one brand that faces the public and another brand that faces employees. There is a single brand, and everybody has to understand it, internalize it, and contribute to it. That means the culture reflects it, as well as the positioning. No special accommodations should be made because you're talking to an internal audience rather than an external one.

I also disagree with the authors' advice to make a so-called "business case" for employer branding because no models are yet available (that I know of) that can determine the value an employer brand adds to the business.

At the end of the day, as former chief marketing officer at Coca-Cola Sergio Zyman might say (as in his book The End of Marketing As We Know It), you brand your business because it helps you to make more money from your customers. You tell your employee what the brand is all about--you show them what it's all about--because it will help you to drive sales. That is the bottom line. That is their motivation--to help the business succeed. All this other nebulous stuff about energizing the workforce with an emotional commitment is just pie in the sky. You can present benefits statements wrapped in a brand until you're blue in the face--but I think employees see right through it. Everything the company does should be about selling to the outside, not selling to the inside. Your employees are already sold on the brand (or else they should be), and that's why they work for you.

Tuesday, January 15, 2008

Switching agencies and branding

A new article in Adweek (January 14, 2008) reports that in a survey of chief marketing officers, “nearly half of marketers plan to fire at least one of their agencies and change direction,” according to the Chief Marketing Officer Council’s second annual forecast.

A total of 825 chief marketing officers were surveyed. They are turning “away from traditional advertising and public relations and toward ‘customer-facing’ and lead generation programs such as event marketing and e-mail.”

Nearly half of respondents, 45 percent, said they were going to change agencies in 2008. They plan to fire their Web design and development firms, direct marketing agencies, general ad agencies, and PR firms.

The article quotes Dave Murray, executive vice president of the CMO Council, who said that Web “is the top priority in terms of brand, customer engagement, insight.” And chief marketing officers are sick of “a lack of innovation,” “no value-added thinking,” and “poor creative.”

Not that they’re spending less money. Fully half of respondents say they will spend more on marketing, including “e-mail programs, CRM, marketing performance measurement dashboards and search engine marketing.”

It appears that the most marketing dollars are being allocated to “strategy and branding,” followed by events, trade shows, operations, direct marketing, sales support, online, and advertising.

So what does this survey show? Marketing officers want to get closer to the customer, and they believe that experiential marketing—direct contact—and the Web are the way to do that. They are less interested in advertising than they were before, certainly.

This is a seismic shift for branding. We are now witnessing the advent of the interactive brand age, and the death of one-way communication models like advertising. Marketers are paying heed to what customers are saying (whether directly or indirectly), which is that they want more in-touch modes of being connected with than just a 30-second commercial. It will be interesting to see where this trend takes us.

Saturday, January 12, 2008

Branding and the upcoming U.S. presidential election

The News & Observer (January 8, 2008) recently published a negative article about branding in the political arena, “Choosy voters choose to go beyond branding.” It’s about the “fusion of ‘branding’ and politics that characterizes not only the way candidates and consultants pitch campaigns to the public, but also the way many of us now see public life.” The author calls this fusion “branditics.”

The author argues that “branditics” reduces the complexity of politics to simplistic messages, and says “Brands work better in grocery stores than in the White House.”

The writer understands branding well: It is indeed “the process of taking something on a shelf or in an office park and transforming it into an emotional experience that pulls us in, makes us believe, inspires us to buy. A strong brand captures, compresses and conveys an organization's values, the promise of its products and the guarantee of a consistent customer experience.”

However, he does not believe that potential presidents should be sold like “cans of Coke.” He does not believe that we should be content with oversimplified labels such as “security” for Giuliani, “competency” for Clinton, “faith” for Huckabee, or “hope” for Obama.

The problem, he says, is that branding closes off choices for the candidates whereas they need “room to maneuver,” to be flexible.

I have to disagree with this author. I think the candidates, particularly Obama, Clinton, and Giuliani, are doing a great job branding themselves for public consumption. In an election where it is sometimes hard to tell apart the candidates’ positions on complex issues, we need a shortcut that helps us define who we may be voting for. Branding doesn’t close off choices for the candidates, it merely encapsulates exactly who they are, what they value, what they promise to the American people, and how they will make that experience consistent.

Related to this is the question of “rebranding America”—which candidate will be the best at giving the U.S. the image makeover many feel it needs? Some feel that it is Obama, because of his race—“A brown-skinned man whose father was an African, who grew up in Indonesia and Hawaii, who attended a majority-Muslim school as a boy, is now the alleged enemy”—they believe that America needs a nonwhite president to convey the message that we are not Anglo-elitists bent on dominating the world. I think that is certainly a possibility. A Clinton presidency would, to me, have a similar effect—in electing a female we would be sending a strong message about our beliefs in equality and diversity and those beliefs are far-reaching. Would electing Giuliani be good for the U.S. brand? Probably not—right now we need to project an image of world diplomacy, not stubbornness and being closed off to other nations and other views. How about McCain? I say, eh—I don’t get much of a brand image there, other than that he’s sort of a standard Republican, whatever that means. And in my view none of the other candidates really stand much of a chance right now…if they do at some later time then I’ll weigh in on their brand image.

Any way you look at it, branding is really critical right now in the U.S. elections. It’s an overall positive for the voter, who gets to make more meaningful choices, and it’s a way to hold candidates accountable to some philosophy or value system that they will have to stick with. It is further a way to help the American voter decide what kind of image they want to project in the world as a nation, and now is a critical time for that kind of decision to take place.

Wednesday, January 9, 2008

Country branding – an instructive article on Brand Kenya

Nairobi’s Business Daily (8 January 2008) carried an excellent opinion piece on what Kenya needs to do to build a country brand, especially in the face of the current instability. “Whereas we had reached a point where Kenya was seen as a case study in political tranquility and economic stability, we are now being showcased in the international media as a war-torn economic time bomb,” writes the author, the CEO of Interbrand Sampson East Africa. “One solution to counter this is to create a strong country brand.”

According to the writer, a country brand offers the following key benefits, and I strongly agree:

  1. Improves a nation’s image in general (obviously)
  2. Aligns citizen’s way of thinking about the country “and speeds up healing and reconciliation”… “builds up patriotism and pride.”
  3. Positions a nation “way above its peers”…offers a “competitive edge” as countries “compete…for tourism, inward investment and export sales.” (Maybe this is three separate benefits?) Specifically, it “gives weight to the ‘made in’ label because it will positively aid the sale of products in foreign markets.”

How do you develop a country brand? The writer notes that you need:

1. The involvement of “government, business, the arts, education and importantly the media.” (I wonder how a country can involve the media if the media’s role is to maintain impartiality and be above notions like branding. The media might report on branding, but how would they be a part of it?)

2. “To find out how your country is perceived both internally by citizens and externally by people abroad who you want to influence.” (“You should also consult with opinion leaders…and compare their views.”) This step cannot be underestimated. It is the critical marketing research piece that every brand requires in order to be successful.

The resulting “brand idea and positioning…positively and clearly differentiates the country from any other.”

This “enables the development of messaging to the various audiences previously identified.”

The writer goes on to state that “the most difficult part of country branding is on the ground roll out. You should work out a programme to make the strategy tangible through improvement projects.” (I’m not sure I understand that part. What kind of improvement projects? How does this relate to the brand?)

The author further writes that it is challenging to create a collaborative system to implement the brand strategy (across government, business, the media, etc.), “without making it look too governmental, because people will instinctively avoid working with it.” (My question is, why will people not want to work with the government on a brand strategy for the country? This does not make intuitive sense to me.)

The author states that although executing the strategy takes time, the important thing is to “be consistent, building an integrated picture and always backing it with quality.” This should be unaffected by what is going on politically. (I am not sure, again, how the strategy is executed unless by traditional means—advertising, marketing promotions, online awareness-building, etc.)

Overall I found this article very useful and highly instructive—for country branding or any other kind of branding, for that matter. The key equation is: collaboration + research = brand positioning and messaging.

Of course, there is always the question of brand vision—is there a way to circumvent the research process and come up with a vision for the brand that is derived from someone’s personal genius? I think so in theory, although it is risky for an entire country to do that.

Finally, there is the question of execution, which remains murky. How exactly do you implement a brand strategy for a country? Aside from advertising (or maybe the primary tactic is advertising)? I would like to read more in these kinds of articles about specific brand-building approaches, both for country branding and branding in general. I am reading another brand book now and it also suffers from the same murky approach to actual implementation…more on that in a future post.

Tuesday, January 8, 2008

Why U.S. federal government agencies don’t brand themselves

In an article titled “Treasury's £2.4m on ‘image’,” U.K.’s The Sun newspaper states that England’s “Treasury chiefs have blown £2.4million in a year on image makeovers. The cash was spent on logos, branding and marketing staff to promote the work of the department and its agencies.”

The article notes that the “biggest spender was the shambolic HM Revenue and Customs, notorious for losing the bank details of 25 million people. It lavished £390,000 on seven brand management staff plus £750,000 on a marketing team last year. Chancellor Alistair Darling blew another £130,000 on ‘branding manuals’ for his departments.”

The article goes on in this vein, eventually quoting Tory spokesman Philip Hammond, who said: “It beggars belief that departments that are supposed to be responsible for the public purse are lavishing millions on self-promotion.”

This kind of story, in a nutshell, could be a key reason why U.S. federal government agencies don’t brand themselves. They could be concerned that the public will view money spent on branding as wasteful frippery rather than serving the taxpayers’ interests.

The job of a brand is to create an emotional connection between an organization and its (external and internal) customers. In doing so, the brand improves the relationship between agencies and their public stakeholders and unifies employees to perform the mission. Branding, in short, makes organizations function better. It is the furthest thing possible from waste (unless, of course, it is done badly, incoherently, inconsistently, or inauthentically). Yet the media is ready to pounce on any dollar spent that is not purely operational—that does not go directly toward the mission.

I ask you, where would agencies be without other mission support areas, like information technology, human resources, finance? The answer: Nowhere, and everybody knows it. Agencies need mission support in order to function. The same is true of branding. Branding, and its sister function marketing, exists in order to make operations palatable to the public, to increase public consumption of products and services, and even to increase the likelihood that the public will pay attention to the informational messages that the agency is sending.

More than that, agencies have public affairs staffs whose job it is to disseminate key information to the public. Their jobs would be made immeasurably easier if their information were associated with a powerful brand, a brand that people paid attention to. How many U.S. federal agencies can you name, off the top of your head?

In short, U.S. public agencies need a brand. And it is up to agencies’ public affairs staff to make the case for branding both within and outside the agency as necessary. The problem is, branding is a “soft discipline,” so it is difficult to make a numbers-based business case—you can’t quantify exactly how much the relationship between the agency and the public will be improved, for example, or predict how much public consumption of agency products and services will go up after the brand has been instituted. I know that Interbrand and perhaps Young & Rubicam (through its Brand Asset Valuator) can quantify the value of a brand of a publicly held, commercial company, but no comparable measures exist for the value of a brand to a public agency.

Unfortunately, there isn’t much research in this area that I am aware of. It would be helpful if there were.

Until such best practice research arrives on the scene, perhaps in the form of a ground-breaking book on federal agency branding, we public affairs professionals working in government can wait for the winds of enlightenment to spring up and carry us to the promised land. But right now, with the lack of information/education available on the taxpayer benefits associated with branding, I wouldn’t hold my breath.

Monday, January 7, 2008

McDonald's goes after Starbucks, Starbucks freaks out

Today’s Wall Street Journal (January 7, 2008) reports that McDonald’s is looking Starbucks square in the eye and going after its core customer.

“Starting this year, the company's nearly 14,000 U.S. locations will install coffee bars with ‘baristas’ serving cappuccinos, lattes, mochas and the Frappe, similar to Starbucks' ice-blended Frappuccino.”

Greedy McDonald’s forecasts $1 billion in annual sales from the program.

The move is a good sign and a bad sign for Starbucks. It’s a good sign in that it recognizes just how mainstream “upscale coffee” has become—it validates Starbucks’ position as a key purveyor of that type of drink.

It’s bad for Starbucks for the very same reason—it shows how commoditized the Starbucks experience is—the very thing that Starbucks chairman (now CEO) Howard Schultz warned about in his famous leaked memo of February 2007.

It is sort of shocking that things have gotten to this point. Starbucks was supposed to be the polar opposite of a commodity purveyor of food like McDonald’s. But guess what? They added food to the menu as well as drive-through windows to achieve growth, and they became, in the end, somewhat McDonald’s-like.

Starbucks is very worried about this encroachment from a potential competitor—so much so that the company just announced it is bringing back Howard Schultz to run the company as CEO. Schultz is going to lead “a major restructuring initiative” that includes a series of initiatives like closing poorly-performing stores, new products, new store designs, and better training for its baristas.

I can understand that Starbucks is concerned. But I will bet you, dollars to donuts, that McDonald’s will never encroach on the true Starbucks consumer. The brand’s “immune system” (to quote former Coca-Cola Chief Marketing Officer Sergio Zyman) won’t allow it. Sure, if you want a syrupy, cheap latte you will be able to get one at Mickey D’s. But the Golden Arches cannot imitate the ambience of Starbucks—which still exists, no matter what anybody says or how supposedly commoditized the chain has become.

At the very worst, says the Journal, “the new coffee program is a risky bet for McDonald’s.” Why? “It could slow down operations and alienate customers who come to McDonald's for cheap, simple fare rather than theatrics. Franchisees say that many of their customers don't know what a latte is.”

I, for one, am absolutely disgusted at the lengths McDonald’s will go to to take over the eating experience of every American. Is there nothing sacred anymore? Starbucks, for all its failings, is still that special “third place” and I would never go to McDonald’s to replicate it.

At the same time, I can understand McDonald’s motivations. Like any brand hungry for growth, it sees an expansion opportunity. However, the McD’s brand does not have "permission" to expand into the Starbucks space. If I were Starbucks, I would not be terribly worried about it. In fact, I might view it, if anything, as a way to expand my own market. And Schultz has said as much. As the Journal article notes:

“Mr. Schultz has said that new competition actually helps Starbucks by expanding the specialty-coffee category. ‘Those consumers over time are going to trade up,’ he told investors in November. ‘They're going to trade up because they are not going to be satisfied with the commoditized experience or the flavor.’ He has emphasized that Starbucks's baristas, who are instructed to memorize customers' drink orders and make genuine conversation with patrons, will continue to set the chain apart.”

At the same time, Starbucks needs to see this as a major warning signal. As I have said before, it is time to reinvent the brand—now. Starbucks should consider killing its own brand and resurrecting it as something even better—the ultimate, uncopyable “third space” that is suited for the way we live now. There is no growth left for Starbucks as it stands anymore—it has saturated the market. It is time to do something daring, different, and better—astounding and delighting the millions (billions?) of dedicated Starbucks fans out there who are rooting for the brand to survive and succeed.

Saturday, January 5, 2008

Customer service, social media, and branding--why brand makers should never, never give up trying

In an article for Brandweek, blogger Shel Holtz talks about the proliferation of “social media” (online participatory sites), including social networking sites and blogs. He cites a study showing that “22% of U.S. consumers are using social networking sites, a 5% increase in just one year.” What’s more, “19% use blogs, a 13% spike. And use of these channels has doubled among people over 55.”

What this means, says Holtz, is that consumers are more often “experiencing your brand in places where you have no control. What’s more, they’re making purchase decisions based on those experiences.” It’s true: people are going online to learn about brands from bloggers, people who leave testimonials on e-commerce websites, friends, and family. Interestingly, they are NOT learning much about brands from company-sponsored websites. So the situation, for brands, is pretty dire: let’s not even talk about co-creation! We’re approaching a situation of customer-creation.

Holtz pairs this with the fact that bloggers tend to write about poor experiences with customer service/technical support, and consumers tend to read about those experiences online. “Every time someone reads a blog post about a tech support nightmare, he has a brand experience. Every time a prospective customer hears someone tell a customer-service horror story, she has a brand experience.”

For Holtz, this leads to the argument that “customer service and tech support are reporting to the wrong box on the organization chart. These functions are the front line of public relations.”

He couldn’t be more accurate. In an era where social media rules, frontline consumer-facing functions are absolutely critical to creating a positive brand experience.

Holtz offers three ways to ensure a positive customer service/tech support experience:

  • Invest in staffing and training for these company representatives (of course!)
  • Have customer service/tech support actively look for people having trouble on social networks (I’m not sure I buy into that one…it seems like a lot of trouble to go through and then you can’t even necessarily reach the complainer)
  • Make every company employee “a potential customer service or tech support rep.” What he means by this is that employees (as in #2 above) should be online looking for ways to be the face of the organization. (I’m not sure I buy into that one either…imagine a company with thousands and thousands of employees, all wasting their time looking online for people who are having bad brand experiences with the company.)

He makes a good overall point, though: that “When any employee can reach out to a customer and solve their problem, the buzz is even better and the brand grows even stronger.”

I think the key takeaway here is that companies are in a fundamental, seismic shift of massive proportions going on and they don’t even realize it. Consumers are slowly but surely taking away control of the brand from the brand maker and putting it into their own hands. And that is a problem because branding, as I have stated repeatedly, is a matter of the brand maker creating a vision, or position for the brand and then reinforcing that vision in every way possible. The implication of Holtz’s argument, which has also been echoed elsewhere in talk about “curator culture” and other archetypes for consumer empowerment, is that brand makers are losing the ability to create brands in the first place. And that is a scary thing.

What should brand makers do? Should they just yield all control of the brand to consumers? Or should they strive to create an even tighter brand experience, a net if you will that will reach over and drape consumers in its web of positive customer brand experiences? If you ask me, I believe that they should make the effort. This means, as Holtz suggests, investing in training frontline customer service and tech support staff, of course. But it also means more than that. It means creating a special cadre of employees whose entire job is to represent the company online. That means infiltrating social networks (honestly, authentically, as company representatives, but infiltrating nonetheless) and finding ways to generate positive buzz about the organization. It means responding to blog posts; countering negative testimonials; and generally doing everything humanly possible to create a sense of consistency around the brand.

In today’s climate, the job of building a brand is undoubtedly harder than it has ever been before. Marketers, however, have no right to throw up their hands in despair and say “I can’t do it.” Rather, they must redouble their efforts to create positive, consistent brand experiences, both online and offline, through advertising and marketing promotions and creating physical, tangible brand experiences that are memorable in the right way. It means hiring the right people at every level of the organization to create a consistent, positive brand culture that delivers on the values the organization ascribes to in every interaction with the public and with other employees. It means beefing up the website, because even if people don’t view it as the ultimate authority on the brand, it still carries a great deal of weight. It means, in short, making sure that wherever people encounter the brand, they are encountering the right set of experiences, tightly knit, heavily controlled, yet personally liberating, symbolic, and meaningful. That is true brand mastery and that is an art that will never, never go away.

Friday, January 4, 2008

Sneak preview: new John Wiley book on branding

In a week, I will be interviewed for a book on aligning the internal and the external brand. The book, which is as yet untitled, is being published by John Wiley. The author of the book is Dr. Claudia Fisher, founder, Lemontree Brand Strategy. With Claudia's permission, reprinted below is the text of the interview and my early written responses to the questions.

1. Aligning internal and external brand activities is supposedly common sense. However, if one observes brand reality out there, this does not appear to be so.

  • Do you think this is a topic of importance/ relevance/ interest? Yes, it is critical. If the internal and the external brand are not aligned the result is a fragmented brand and that is not sustainable in the marketplace.
  • Why do you think alignment is so challenging? Because organizational leaders often do not receive upward feedback, they do not understand that employees are every bit as much stakeholders as external customers. They don’t understand that employees read the newspaper and go to the company’s website the same way that external customers do. They take for granted that employees are loyal to the company (because they are getting paid) and don’t try to earn that loyalty. Also marketing communications is siloed from the other parts of the organization that need to work with it to communicate the brand internally—human resources and the training function.
  • What do you think are key sources for misalignment? Leaders who communicate upward or outward only instead of downward and internally. Also failure to create cross-functional communication teams around the brand. Also failure to pay attention to building a unified culture around the brand.

2. More and more brand experts believe in co-creation of brands.

  • How would you define co-creation? Who are the key parties involved? Co-creation is when the customer has a voice in defining the brand, usually through the Internet – giving a testimonial on an e-commerce site, or authoring a blog, or even just e-mailing friends and family. However, co-creation can also be when the employees of the organization have a voice in creating the brand together with the marketing/communications function and/or the agency.
  • Who should be the key parties involved? The CEO of the brand on the one side, the marketing/communications department and the advertising/marketing agency in the middle, the employees of the organization as another part, and the customer on the other side.
  • What is the impact on brand management? Ability to control? More and more, customers and employees are defining what the brand is and does, but the brand manager still retains a great deal of control over the brand’s image. The brand manager can create the desired image and also engineer conversations via experiential marketing and Internet polling with consumers that generate the desired image. For example, Panasonic parks a truck in various retailer’s parking lots that showcases its electronic products, and invites customers to experience the Panasonic brand. Those experiences create impressions and conversations.
  • What are the risks of not embracing co-creation as a reality? The risk is that you create a disconnect in the marketplace between your positioning, or how you want your brand to be perceived, and your image, or how your brand actually is perceived. That disconnect can destroy your brand. It is especially dangerous when companies do not realize that their employees are effectively co-creating the brand every day, and that the message employees send in their interactions with customers may be different than the official party line.
  • Does co-creation render the issue of internal/ external alignment meaningless? It makes it more complicated. We are not living in a command and control environment anymore. People today are more independent of authority than they have ever been. They, especially employees, need to be inspired to rally around the brand, to make it a cause and to look at it the same way that the official leadership does. At the same time, leaders need to get closer to employees and customers and find out where their affinities to the brand lie, and mirror that in brand communication. For example, the Wii videogame is very popular among seniors in the United States , even though the brand is marketed to young people. Seniors have co-opted it. The makers of Wii therefore need to address seniors in their official brand communication, even if they create a subbrand to do it.

3. In the past, branding was very communication-led.

  • Do you think this will change in the future? Why or why not? How? This will not change at all.. All branding is created continually through a form of communication and interaction with consumers, whether it is advertising or marketing promotions or word of mouth.
  • Where do you see the key opportunities for brands going forward? The brands that will succeed in the future will take one of two tracks. One possibility is to be very close to the customer by taking a scientific approach, polling and surveying statistically and continually to find out what the consumer wants and then to meet that. Another possibility is to be highly visionary, and create demand through some sort of unique insight into the world and where it is going. Or there can be some combination of the two. In the U.S., Oprah Winfrey is an example of a highly visionary brand, that takes a stand on a variety of issues important to her, but that incorporates constant feedback from television viewers and Internet readers.

4. Do you think the role of brands in general is changing? If so, how and why?

  • Do you think that brands today are more important or less important than in the past? Why? Both -- brands are more important and less important. They are more important because there is truly an endless proliferation of choices in the marketplace and they provide a shortcut to making a decision about what to buy. They are also more important than in the past because with the Internet and e-commerce, we are living in more of a consumer culture than ever before and membership with a brand provides status in that culture. They are less important also because there is such a proliferation of equivalent choices that the distinction can tend to become meaningless, a consumer may choose randomly or based on price alone.
  • Who do they/should they primarily appeal to? Brands should make their appeal to people who are willing participants in consumer culture, not to people who have rejected brands and branding, of which there seem to be a substantial number. It does not pay to go after everyone.
  • Who should “own”/ be responsible for the brand internally? The CEO or leader of the organization must own the brand, there is no other way to champion it. The marketing/communications department simply does not have as much impact as the organization’s leader—he or she sets the tone for everyone else in the organization.. At the same time, the leader must invest the employees themselves with ownership over the brand so that they carry it forward as if it were their own.
  • What is the role of “authenticity”? Is it a fad or more permanent? In my view authenticity is critical and permanent. People must believe that the story you are telling is true on some level. Look at the U.S. brand Harley-Davidson. That brand, which has to do with personal freedom, has traditionally been identified with men and their motorcycles but is now branching out to appeal to women. And the appeal stays true, despite the branching out, because the brand has that cachet of sticking to its guns and promoting freedom.

5. Do you think consumers are changing? If so, how?

I think the Internet fundamentally changed everything when it comes to being a consumer. For one thing, consumers are more price-sensitive than they have been in the past—they can look online for just about anything and get it from the cheapest vendor possible. From that perspective, the role of branding is diminished. However, at the same time, consumers recognize that they need to buy from trustworthy sources so that they don’t just send their money out into the vapor and never receive product. So from that point of view, the role of branding is dramatically increased. Another impact of the Internet, as has been stated repeatedly by others, is that consumers are talking back to brands—they are more willing to get out there and share experiences with product online. This makes them more skeptical and empowered about what brands are claiming to provide. At the same time, it also makes them more open to brands because they are always looking for the next new thing—giving innovative brands a chance to win their loyalty.

6. Do you think that the role of employees vis-à-vis brands is changing? If so, how?

It’s changing in a couple of ways. First, employees are learning from their external experiences with the Internet that they should talk back to brands, including the brands they work for. So their expectation is to have more of a say in the brand. This can hurt the ability of leadership to drive a certain brand culture throughout the organization, because employees see themselves as equally suited to say whether a particular course of action is appropriate. At the same time, employees are more brand-identified than ever before, and they WANT to be part of a great brand. So I think they are more willing to participate in creating a great brand, and are more able to see themselves as stewards of the brand in their interactions with customers.

7. Do you think that the way we do business is changing? Is there, for example, more focus on ethics or is this simply a reaction to the current political environment?

I think organizations are more conscious than ever of ethics, integrity, the environment, and so on. In the U.S., Bank of America is running ads demonstrating how its employees have contributed back to the communities in which they work, and saying in effect that you should bank with us because we are socially responsible. I don’t know whether that will have an impact on using the brand, but companies seem to think that it will.

8. How important do you think company values are versus the brand? How do the two concepts relate to each other? Is it practicable / necessary to have both concepts? Why or why not? Where does culture belong? Can culture be controlled by branding?

Company values are absolutely critical to branding. It is essential that companies have values, and that the values be the right ones. Generic or bland value statements have no meaning and can actually detract from the brand. Culture is critical to branding—you cannot have a sustainable brand unless you use the brand to drive the organization so that the norms, beliefs, customs, rules, and regulations, training, organizational structure, and all of that supports the business results that the brand is supposed to create. As Barlow and Stewart argue in Branding Customer Service, you must start with the experience that you want the customer to have and then work backward to create a culture that will enable those experiences.

9. How can a brand grow and still remain true to itself?

The goal of every brand should be to grow and serve everyone in the niche that it has identified, without losing the integrity of its message. It is very tempting for brands to try to be everything to everyone, and unfortunately success can lead them in that direction. But the most important thing is to say, this is my core customer and this is the experience I want to provide to that customer, and I will not stray from that. If the brand is itching to do more, it can create another brand to serve another group of customers. But it should not expand beyond the limits of what Sergo Zyman calls “brand immunity”—it should never do things that are contrary to its character in order to sell to more customers.

10. Which brands do you admire most and why? What can be learned from them?

What are the key success factors for brands today? Key challenges and obstacles?

The brands that I admire most are people-brands, generally, not organization-brands. Oprah Winfrey and Hillary Clinton come to mind. They are both examples of stubborn determination, in the face of constant obstacles, to be successful in the way that they uniquely define success. And they never look back or second-guess themselves or try to leap out of the categories that they have defined for themselves. They are disciplined and persistent, and yet they are flexible enough to listen to their constituents and incorporate that feedback into their message. And that is what I think every brand ought to be. The key challenge for brands today is to stay in tune with what’s going on with customers, but at the same time not to get thrown off course or off-message.. That is a delicate balance to strike.

11. Are there any other issues/challenges/concerns that come to mind in this context?

I the biggest issue for brands is how much they are willing to gamble on their concept in a world where consumers are fickle and where a good idea can be copied instantly. At the end of the day this requires a certain disciplined irreverence. By that I mean that companies should do their homework, figure out exactly who they are targeting, down to a detailed psychographic of their customer, and then let their imaginations run free. This involves a certain amount of risk but it is a disciplined kind of risk, and companies should be willing both to invest liberally in new ideas and to pull the plug on those ideas if they are not working. They should also be prepared to change course frequently—offer new products, services, enhancements, etc. to keep the brand fresh. The important thing is to stay true to the spirit of the brand and the customer for that brand. If you know your brand and you know your customer better than anyone, and you stay focused on aligning the brand experience for the customer all the time, you have a recipe for sustainable brand success. And that is why the employees of the brand organization are critical. They are the ones who reach out to customers on the frontlines and they are the ones who must tell you when it is time to correct your course of action. If you don’t have a good pipeline from the frontline employees to leadership, then you don’t know when things are going wrong and it takes much longer to adjust as needed.

Wednesday, January 2, 2008

Word of mouth marketing and "cheeseheads"

First, an item from Brandweek’s December 31 edition: word-of-mouth marketing is “projected to hit $1.3 billion this year, up almost 33% from $981 million in 2006,” and “spending is expected to triple by 2011.” This is due to “the explosion of communications on the Internet” and “the acceptance of WOM as a separate discipline beyond ads and public relations.”

This makes sense to me. In an era where the consumer is taking increasing control over marketing, it pays to spend money to facilitate WOM. What the article doesn’t explain, though, is what all this money is being spent on if word of mouth is mostly done for free, by consumers leaving feedback on e-commerce sites, social networking sites, and blogs. True, there is a mention of a company that “leverages relationships with artists in underground New York scenes to build buzz.” But that’s just an isolated case. I would like to know more about how companies are paying to generate WOM.

Speaking of WOM, Wisconsin is generating some buzz as it is trying to come up with a new brand besides “cheeseheads,” which is what they’re known for—dairy and specifically cheese. They seem to be committed to the project, to recognize the obstacles (stereotypes are tough to change; the tourism department “has used numerous slogans in advertising campaigns”; and Wisconsin has “cold winters, high unionization, mid-continental location and relatively high taxes”), and to have done a good job understanding the importance of positioning—finding “that single point of difference”--although the article on this subject doesn't say what that is. They also hired local talent to work on the campaign, thus increasing the chance that the campaign will show deep insight into the brand. (The CEO of Madison, Wisconsin-based branding firm Lindsay, Stone & Briggs is the one who wrote about the cold winters, unionization, location, and taxes in a paper penned eight years ago.) Good going Wisconsin—good luck!

Tuesday, January 1, 2008

In defense of brands

The Sydney (Australia) Morning Herald yesterday ran an article, “Twelve steps to a brand-free life,” by an individual who a short time ago beat his obsession with consumer labels and shopping. The author had been an avid fan of brands like Adidas and Apple, “to the point that I could not contemplate buying products made by their rivals.” He relied on brands “to increase my confidence at meetings (BlackBerry) or my status at the bar (Ralph Lauren).” He used to “escape the office to shop.”

This person, on deciding to “destroy my previously branded life,” set up “a public bonfire in central London, fuelled by my possessions. Twenty years of designer shopping went up in smoke.” The author says that “I have struggled to live my life brand-free ever since.” However, this is difficult because brands and their messages are everywhere.

The author states that “The message behind every brand is we will feel better for consuming more” but “consumer culture has transformed our lives for the worse. We work more and we imprison ourselves in debt.” He even goes so far as to blame materialism for inhibiting efforts at “tackling climate change.”

The author says “the symbol of a sports shoe manufacturer should not embody freedom. Nor should the symbol of a bag manufacturer embody aspiration.”

What is a brand-avid consumer to think when reading this article? First, obviously, compulsive shopping is different from compulsive brand identification. Compulsive shopping is no doubt an unhealthy thing, but needing to identify with brands can be a positive one—brands fill a human need to identify with something larger in life than just oneself. When you use a particular brand you are making a statement about yourself and your beliefs. There is no reason to give up such a powerful message.

Second, consumer culture is great, not terrible. People exist and interact in the marketplace, where they find they have a choice about which things they buy—brands provide that choice. And people don’t just shop because they want to, they shop because they need to.

Third, what a dull world when people resort to shopping army surplus for clothes, as the author does, and live without TV and the like. Brands don’t just bring meaning to life, they give it excitement. It is fun to look for the next big brand and to purchase items from the brand maker. Why should life be boring?

Undoubtedly a lot of people will identify with the author of this story, who decided that brands were too overwhelming a presence in his life and to minimize that. But I think that people who miss out on brands are missing out on life. There is so much out there to enjoy and consume, and brands make that possible.