Branding Strategy Insider

Brand Repositioning And Organizational Reinvention

We have been working with a number of organizations lately whose brand repositioning efforts involve nothing less than organizational transformation including business model and culture change.

Take libraries as an example. In most people’s minds, libraries are synonymous with books. However, for those of us who can afford it, Amazon.com is a much more convenient source of books, with its 24/7 availability, advanced search and browse capabilities, extensive product reviews and very quick shipping.

One of the underlying benefits of books is information. How much easier is it today to search for information online using one of many search engines rather than going to the local library? And whether you are looking for information or just the pure pleasure of reading, think about the advantages of going to a Barnes & Noble store with its overstuffed chairs, café, book readings and signings, community rooms, etc.

Where then does the modern library fit into people’s need fulfillment? I believe libraries need to redefine themselves from ‘book archives’ to ‘community places’ – places for the acquisition of information, sharing of ideas, exposure to different cultures and enrichment of life in general. Obviously, this has huge implications for brand position, competitive set, culture, business model, sources of income and the physical environment. I believe that this example demonstrates that increasingly brand repositioning is accompanied by culture and business model change requiring the interdisciplinary efforts of marketing, business strategy and human resource professionals at a minimum.

Sponsored By: The Brand Positioning Workshop

Building Winning Brands - 4 of 16

The fourth most important thing to know about building winning brands is that the brand and its products and services must exceed customer expectations. 

No amount of customer communication and relationship building can compensate for inferior or even parity products and services.  New brands win in the marketplace because they meet customer needs in superior ways. 

Amazon.com introduced a new, much easier way for people to find and purchase books on specific topics (through its sophisticated search and browse techniques and its 24x7 store hours). 

Starbucks turned coffee drinking into a pampering, indulgent experience. 

Chrysler’s PT Crusier and the new Volkswagon “bug” sold so well because of their superior design aesthetics. 

Midwest Express delivers a superior level of airline service throughout the cabin with its “best care in the air” promise. 

Think of the brands that have exceeded your expectations.  They are likely to be “tops” in your consideration sets for the products and services that they provide.

The “legendary service” movement in the eighties is as important today as it was then.  That movement encourages brands to deliver legendary service so that people feel compelled to tell others about the incredibly positive brand experience.  For example, Saturn created a television commercial spreading the news about one of its dealers flying to Alaska on a rented plane to replace a part on a recalled car in the customer’s own garage.

Of Brand Marketing And New Business Ventures

As I work with more and more smaller businesses, including start-ups, it has become obvious to me that some businesses attempt to address underlying business problems through branding. I find that I am not only consulting on branding but also general business strategy and especially the intersection between the two. Given this clear need, this post is about the intersection of branding and business strategy in creating a successful new business.

A very common problem I encounter is businesses that have a product and a manufacturing process but little understanding of the underlying customer need that the product addresses. Businesses should always start with a solid understanding of the customer needs that its products and services can fulfill – functional, emotional and otherwise. This assumes that the business has already identified its primary and secondary target market segments and knows a fair amount about those segments’ needs, desires, hopes, fears, values, aspirations, problems, concerns, shopping behaviors, etc. All of this can be discovered through formal or informal market research. Research techniques are myriad, but often include one-on-one interviews, focus groups, online surveys and discussions with current customers. Another technique is to ‘shadow’ your customers and ‘live the brand’ with them to discover how they experience it.

Another common problem is developing a product or service that does not deliver a superior value proposition to what is already available, either because it is not differentiated in relevant ways from what is already available or because its cost structure demands too high a price for the perceived value.

Overcoming Common Brand Problems - 26

Number 26 in our countdown of 40 is both fundamental and much too common...

Common Brand Problem Number 26: No brand identity standards and systems means inconsistent presentation and customer confusion

Analysis: A brand should be presented consistently— name, logo, personality, visual style, icons, etc.—across all applications.

Key Point: The only way to ensure this is with comprehensive brand identity standards and systems that are well understood and easy to use. Standards manuals are a minimum requirement—available electronically and on your Intranet site.

Think of your brand as a person. Does it present itself consistently in all situations or does it seem to have “multiple personalities?”

Sponsored By: Brand Aid

Branding Trends

A current trend in some companies is to include the human resource function as a part (and in support) of the marketing function. Michael Porter’s customer value chain concept is based on the thought that every activity a company performs should add to customer value, or it should be eliminated. If a company has chosen the right promises for its brands, the concept should be adapted so that all company activities should contribute to the delivery of brand promises or be eliminated. This includes operations, logistics, marketing and sales, human resource management, organization design, technology development, procurement, etc.

Sponsored By: The Brand Positioning Workshop

Brand Management: A Superior Paradigm

If the brand is recognized for what it really is--a very important asset that must be built, maintained, enhanced and leveraged--then people will begin to view brand activities and spending very differently. 

This must begin with the CEO and the CFO, but it should be a view shared by all employees.  The CFO can become one of the biggest brand supporters if he or she is aware of the financial value of the brand asset.  This is why measuring the value of the brand asset is so vitally important.

The most successful brand building organizations are creating a new brand management paradigm.

Old Paradigm
Individual product brands
New Paradigm
Corporate brand
Old Paradigm
Business is defined as a product category (such as “greeting cards”)
New Paradigm
Business is defined as the brand essence (such as Hallmark's “caring shared” )
Old Paradigm
Brand is managed by advertising department and agency
New Paradigm
Brand is managed by the CEO, a corporate officer responsible for brand equity management  and all employees in the organization
Old Paradigm
Product management is central focus of the organization
New Paradigm
Brand management is the central focus of the organization
Old Paradigm
Brand management is treated as “overhead” and brand marketing as an expense
New Paradigm
Brand management is a critical function performed by all employees and brand marketing is an investment in the company’s future
Old Paradigm
The CFO is skeptical of the worth of the brand management function and brand spending
New Paradigm
The CFO knows the value of the brand as a financial asset and is one of the most outspoken supporters of brand management
Old Paradigm
Brand marketing and brand identity standards and systems are aligned in support of the brand essence and promise
New Paradigm
Everything in the organization is aligned in support of the brand essence and promise, including:
•Mission, vision and strategy
•Values and behaviors
•Communication
•Products and services
•Operations, systems and logistics
Old Paradigm
Branding is often an afterthought (“Now what should we call this?”)

Brand Research: Defining Conjoint Analysis

This branding question comes to us from Dan, a senior marketer in St. Louis, Missouri. He writes...

"What is your definition of Conjoint Analysis?"

Dan, thanks for asking. In conjoint exercises, respondents express their preferences for products described by varying levels of attributes.  By observing how respondents evaluate products in response to underlying changes in attribute levels, we can estimate the impact (utility) each attribute level has on overall product preference.  Once we learn respondents’ preferences for the various attribute levels, we can predict how buyers might respond to any combination of levels in our study, whether or not that actual product was ever displayed during the interview.

Traditionally used for pricing research, conjoint analysis is very applicable for brand research as well.  Respondents rate their buying intent for products comprised of various combinations of attributes (including product, service, sales terms, price and brand attributes).  Brand name is one of the attributes.  Not only is this an excellent approach to measure the overall equity of your brand name vis-à-vis competitors, but it also allows you to measure the interactions/relationships of your brand name with other attributes.  Simulation exercises also allow you to project the impact on share of preference for various attribute combinations (what-if exercises).

You can find more on this topic here.

Have a question related to branding? Just Ask...

Sponsored By: The Brand Positioning Workshop

Building Winning Brands - 3 of 16

The third most important thing to know about building winning brands is that profound customer knowledge is essential. 

Bill Stacy, one of my bosses at Hallmark Cards, was fond of saying, “Remember to thank our customers for your pay check.”  This statement was a constant reminder that all of an organization’s revenues and profits result from one thing – customers who are willing to pay money for products and services that meet their needs.  Any brand management initiative, any marketing initiative, and indeed any business or organizational initiative must start with a solid understanding of the customer.  Indeed, organizations exist for one purpose – to meet human needs.  Thriving organizations do that exceedingly well.  Venerated organizations have managed to meet evolving human needs over a long period of time.

The first step in crafting a brand’s promise is defining the target customer.  Without a profound understanding of the target customer, a business will never thrive and may not even survive.  A strong brand promises a relevant, differentiated, purchase-motivating benefit to the target customer.  The benefit must focus on points of difference, not points of parity.  The ideal benefit to claim has the following three qualities: (1) it is extremely important to the target customer, (2) your organization is uniquely suited to delivering it and (3) competitors are not currently addressing it (nor is it easy for them to address it in the future).

Customer research has become very sophisticated, going far beyond the standard survey or focus group.  Brand positioning should be informed by both qualitative and quantitative research.  Brand extension is informed by brand asset and brand association studies and concept testing.  Marketing savvy companies now use projective and anthropological techniques.  The are also specific techniques for logo recognition and recall and brand equity measurement. 

Customer insights can also be gained through the Internet (blogs, chat rooms, message boards, online surveys, etc.) and customer service feedback.  Harley-Davidson executives ride with their customers in HOG rallies as a routine source of customer insight.  While customer insight is important, it does not replace ideation and market need anticipation.

Sponsored By: The Brand Positioning Workshop

The Ketchup Conundrum

Mustard now comes in dozens of varieties.
Why has ketchup stayed the same?

1.

Many years ago, one mustard dominated the supermarket shelves: French's.  It came in a plastic bottle.  People used it on hot dogs and bologna.  It was a yellow mustard, made from ground white mustard seed with turmeric and vinegar, which gave it a mild, slightly metallic taste.  If you looked hard in the grocery store, you might find something in the specialty-foods section called Grey Poupon, which was Dijon mustard, made from the more pungent brown mustard seed.  In the early seventies, Grey Poupon was no more than a hundred-thousand-dollar-a-year business.  Few people knew what it was or how it tasted, or had any particular desire for an alternative to French's or the runner-up, Gulden's.  Then one day the Heublein Company, which owned Grey Poupon, discovered something remarkable: if you gave people a mustard taste test, a significant number had only to try Grey Poupon once to switch from yellow mustard.  In the food world that almost never happens; even among the most successful food brands, only about one in a hundred have that kind of conversion rate.  Grey Poupon was magic.

So Heublein put Grey Poupon in a bigger glass jar, with an enamelled label and enough of a whiff of Frenchness to make it seem as if it were still being made in Europe (it was made in Hartford, Connecticut, from Canadian mustard seed and white wine).  The company ran tasteful print ads in upscale food magazines.  They put the mustard in little foil packets and distributed them with airplane meals—which was a brand-new idea at the time.  Then they hired the Manhattan ad agency Lowe Marschalk to do something, on a modest budget, for television.  The agency came back with an idea: A Rolls-Royce is driving down a country road.  There's a man in the back seat in a suit with a plate of beef on a silver tray.  He nods to the chauffeur, who opens the glove compartment.  Then comes what is known in the business as the "reveal."  The chauffeur hands back a jar of Grey Poupon.  Another Rolls-Royce pulls up alongside.  A man leans his head out the window.  "Pardon me.  Would you have any Grey Poupon?"

In the cities where the ads ran, sales of Grey Poupon leaped forty to fifty per cent, and whenever Heublein bought airtime in new cities sales jumped by forty to fifty per cent again.  Grocery stores put Grey Poupon next to French's and Gulden's.  By the end of the nineteen-eighties Grey Poupon was the most powerful brand in mustard.  "The tagline in the commercial was that this was one of life's finer pleasures," Larry Elegant, who wrote the original Grey Poupon spot, says, "and that, along with the Rolls-Royce, seemed to impart to people's minds that this was something truly different and superior."

Straight Talk On Branding III

This week I want to share my third installment, and maybe a fourth on developing a brand building organization. My last installment is here.

There are four organizational support factors that are critical to brand strategy success. They are:

•CEO leadership and support
•A distinctive corporate culture that serves as a platform for the brand promise
•The ability to obtain support from a broad spectrum of employees
•The alignment of brand messages across functions

For many, developing a brand building organization requires dramatic change. Here are some of the most common problems that organizations encounter when trying to implement new brand management programs:

•Senior management is not focused on the brand
•Senior management has a short attention span and fails to provide the support and resources necessary for the branding to occur
•Some senior leaders do not seem to buy into the brand management concept at all
•The organization is highly fragmented and resistant to change
•The organization is internally focused
•Difficulties in shifting people’s focus from their functional “silos” to cross-functional ownership of the brand
•The organization’s culture does not reinforce the brand
•The organization’s operations and systems do not support the brand
•The brand message is just one of many among a myriad of corporate messages

To create the change required to establish a brand building organization I firmly believe all of the following questions must be addressed:

•Is the corporate mission and vision congruent with the brand essence and promise?
•Is the business planning process linked to the brand planning process?
•Do the corporate culture, values and behavior support the brand essence, promise and personality?
•Are you recruiting the kinds of people who can deliver against the brand promise?
•Are you using internal communications vehicles to communicate brand positioning, strategies and priorities?
•Are you using training and development to increase understanding of brand positioning, strategies and priorities?
•Do performance objectives (especially common objectives) include brand objectives?
•Do you provide feedback on performance appraisals on how well individuals and groups are delivering against the brand promise?
•Do you reward and recognize people who have furthered important brand goals?
•Do you compensate people for achieving brand objectives?
•Do your products and services deliver against the brand promise?
•Do your operations, systems and logistics support delivery of the brand promise?