Chemistry or contamination: Dow at the Olympic Games

Right now a brouhaha is building between the India Olympic Committee and the IOC over the presence of Dow Chemicals at the London 2012 Summer Games. In particular, India is up in arms over Dow’s sponsorship of an $11.4-million decorative wrap to be installed around the London’s Olympic Stadium, according to this post in Brandchannel.

The Indian Olympic Committee takes exception to Dow’s ownership of Union Carbide, which Dow bought in 2000, 16 years after that company’s plant in Bhopal had leaked gas killing thousands and injuring hundreds of thousands more. For their part, Dow seem to be saying that they didn’t own the plant when the accident happened and therefore the Bhopal tragedy is not their responsibility.

In a letter to the Indian Olympic Association quoted here , IOC President Jacques Rogge explained that “Dow had no connection with the Bhopal tragedy.

“Dow did not have any ownership stake in Union Carbide until 16 years after the accident and 12 years after the $470 million compensation agreement was approved by the Indian Supreme Court.

“The court has upheld this agreement twice since then, in 1991 and 2007. We understand that this is being reviewed yet a third time by the India Supreme Court and we are aware of Dow’s position in this matter, and of the sensitivities of all parties.”

There are some far-reaching implications in this story that I thought it would be useful to explore.

To my mind, it is simply not true that Dow has no connection with the Bhopal tragedy. They were not directly involved, but that does not mean they are not connected. And that’s because there is a significant and important difference between legal ownership and brand ownership. In addition to the lingering contamination and the human misery that continues to haunt the families of those affected, and which will continue to affect perceptions of their brand, what Dow seems to have overlooked in their statements about Union Carbide, and the big lesson for brand owners and acquirers the world over, is that when you purchase a brand, you pay for all the assets.

That includes the physical property and goodwill of course, but Dow have also, and unmistakeably, purchased the “badwill” as well because, when they bought the Union Carbide brand, Dow acquired the global memories of what transpired at Bhopal and the enduring emotional reaction to that tragedy. They continue to own that “badwill” regardless of the actual legal arguments and decisions.

When they bought Union Carbide, Dow inherited emotional responsibility for how the world feels about the legacy of what occurred, whether they wanted it or not. They can rationalise all they like that a compensation agreement has been paid, and that they have legal decisions in their favour, but that does not mean that the company can sweep the inconvenient parts of its acquired history under the carpet and somehow view them as divorced from the plant they bought.

Indeed, one could argue, if you apply that line of thinking elsewhere, that no company today  should be responsible for cleaning up what has happened to the environment because the damage was first done years ago by someone else.

Global companies are not just globally accountable for the brands they own and the companies they acquire, as shareholders they are responsible for the brand equity they manage and the emotions associated with their brands. They cannot selectively impose territorial N/As or hope to deflect responsibility for ownership from those parts of their organisation that no longer suit them by gloriously proclaiming and highlighting their participation in another event half a world away.

A wrap is not a gag – no matter how much it costs. Nor can it be a cover-up.

And time does not diminish moral responsibility – especially for a brand.

Brands are living memories. As long as the memories live, they are a responsibility of the brand owner.

What Dow have missed here in my view, dating all the way back to the date of purchase, was an opportunity to step up and take control of correcting the situation they had inherited. This could and should have been a showcase example of the chemicals industry leading the great global clean-up – working with the community to change the future for all those innocent people caught up in these horrendous events. Once again, what I can only assume was risk aversion has seen a brand back away from an opportunity that should have generated them massive goodwill. As a result, they now find themselves in damage control, looking to distance themselves from the fall-out of an asset that is undeniably part of their global brand.

Perhaps they thought no-one would question their involvement with the Olympics after so many years. (Why has it taken this long incidentally?)

Welcome to a world where scrutiny never dies.

What also seems to be missing from events in London is a very clear and assertive principle for involvement by the IOC. IOC President Jacques Rogge simply says in the Brandchannel article that they were “aware” of the Bhopal tragedy. What exactly does “aware” mean? And what influence did “aware” have on their decision? How long have they been “aware”? And have they ever done anything about their awareness?

I’m disquieted by what I read. In the newspaper article Rogge is quoted as saying that the IOC only enters into partnerships with organizations which the IOC believes work in accordance with the values of the Olympic movement.

“Dow is a global leader in its field of business and is committed to good corporate citizenship,” he is quoted as writing to the Indian Olympic Committee. “The company has supported the Olympic Movement for over 30 years, providing support and bringing industry-leading expertise and innovation to the Games.”

Spot the subjectivity in both these statements. Once again, it is a cautionary tale for all brand owners and managers. I interpret Mr Rogge’s statement as saying that as long as the IOC believes an organisation aligns with its own values, it will work with them. And while Dow may be committed to “good corporate citizenship”, it seems to be Dow who decides on the calibre of their own citizenship.

Unfortunately, for both organisations, you don’t get to referee your own corporate reputation. So while both Dow and the IOC may be satisfied with their actions, that does not mean they are exempt from criticism. Meeting your own criteria for comfort is not enough in a world where everyone gets to form and post an opinion.

Then there’s the reference in his letter to the long-running nature of the relationship between the IOC and Dow, and the fact that, according to the newspaper article, Dow only became involved after Olympic officials had scrapped plans for the wrap because its price had been deemed too expensive at a time of economic austerity.

How do you read all that?

For all these reasons, and despite talk of standards and values and legal justification, I have to question the brand case for Dow’s high profile involvement. What are they hoping to achieve?

More particularly, where is their involvement in the debate raging around them? If they believe they are right, why are they not more engaged socially in this discussion? I would have thought that the questions being asked now, by the Indian Olympic Committee, by Amnesty International and by others, are working to undermine the very “good corporate citizenship” status that Dow must have set, surely, as one of its objectives. They have a right – maybe even an obligation – to defend that. Yes, they’re paying for something that might not have been affordable otherwise, but the cost to their own brand and to their own reputation could be very high indeed if this matter continues to escalate.

Leaving it to others to speak on their behalf is not a strategy I would have recommended. It implies they don’t have answers – or, at the very least, that they are not prepared to answer the concerns of their critics. That’s a vacuum. And vacuums will always be filled. By you, or by those who will speak over you or in your stead if you do not respond.

As for the IOC, why are they supporting Dow? I hope the sponsorship selectors did indeed carefully and objectively assess Dow’s involvement against their values, as they say they do with each partner, and that they didn’t just take the money because of a funding shortfall. I hope they can prove that if required, for the sake of the five rings brand as much as anything else. Sorry to be so frank. But if that were not the case, it would be a serious blow to the integrity, and therefore the likeability, of the Olympic brand.

Great brands unearth

Image via Wikipedia

In his recent post on imputing, Tom Asacker used a single word that for me clinched the mystery and the power of great marketing, and explained why so much money is spent on communication that just inspires a change of channel.

That word: unearth.

Unearthing is about discovering. It’s about seeing for the first time something that has been hidden for a very long time. It’s about revelation. It’s about something that inspires.

Great brands release emotions that people are not asked to feel most of the time. They uncover the irrational drivers that impel busy, pressed, distracted human beings to stop doing nothing or something else and instead make the time to take an action.

Because that action is worth it to them. And it’s worth that time because it feels worth that amount of time.

Most brands don’t work that hard to win our time. They are unsurprising, uninspiring, unprovoking. They unearth nothing. On the contrary, they monotonously state the obvious. They go over and over and over the same old ground. And in the process, they dig themselves into a hole that sees you, me and everyone else turning the page, changing the channel, looking away. Bored, frustrated, interrupted. Just wanting them to go away.

Tom Asacker suggests that “most brands haven’t a clue about how people actually feel, think and act.” He’s right of course. But I’m even more disturbed by the reasons why. You see, I think many marketers have lost the quintessential trait that should single them out from every other aspect of corporate function: a deep understanding of, and love for, people and the primal emotions that fundamentally motivate them.

They lean so heavily on research and focus groups and in the process, marketers have forgotten how to observe. Or more particularly, to perceive what is really going on. They can’t detect what moves people. Or motivates them. Or stirs them. Beyond the obvious.

The same obvious that everyone else sees. The same obvious that everyone relies on.

And because they have lost those traits, they do not trust their instincts. They cannot speculate. The need to explain and rationalise and prove and justify has killed their ability to divine – to find what moves people as people to the very core of their being. They struggle to find the unexpected value and the unexpected truth that separate likeable brands from also-brands.

And because they can’t do that, they cover their tracks with data, run another highly predictable, highly analysed, deeply comfortable campaign and hope somehow that it gets them the breakthrough and the results they crave.

According to Howard Carter’s diary, on the day that the tomb of Tutankhamun was finally revealed to the modern world, Carter peered into the darkness through a hole in the doorway, his eyes straining to make out shapes, a candle his only light.

“Can you see anything?”, Lord Carnarvon asked.

“Yes,” replied Carter, “it is wonderful.”

Most of us, sadly, will never get to feel what those explorers felt on that extraordinary day. But let me ask you this. When was the last time you unearthed a brand that provided even a tincture of amazement? In a world swimming in ads and noise, discovering such brands might indeed be as rare an encounter as an intact Pharoah’s tomb.

The power of being purposeful

In an age where products are increasingly similar and of equal quality, the opportunities to compete just on the basis of what you sell are disappearing. In fact, I’d go further than that and say, they’re as good as gone. Even if you know that your product has some sort of technical advantage over that of a rival, the chances of you continuing to hold that advantage or of that advantage being of such significance that consumers actually care are as good as nil.

So given that – how do brands look to compete? By my book, as product parity rages, competition between brands in today’s world is increasingly waged between stories and intentions. Both inside and beyond the walls of the corporate owner.

That’s because, for customers, tell me what has been replaced by tell me why as the shelves overflow with look-alike products.

And for employees, tell me what to do has been replaced by tell me why we are doing this as rules give way to reasons.

In this context, purpose is no longer a lofty description of what you want to achieve as a business. It has to be a description of what you think must change, and it needs to provide inspiring reasons for staff to take that journey.

To build a successful purpose, I believe you need 5 things:
1.  An enemy – something or someone to direct a whole lot of pent-up energy towards. That’s not necessary a competitor. It can, for example, be a situation. As Tom’s have shown, your enemy can be altruistic such as the fact that so many children are without shoes.
2.  Motivation – something that is worth expending that high energy for.
3.  Curiosity – the wish to probe what you do in order to find how you’re going to pull off the purpose you’ve set yourselves.
4.  Authenticity – a culture that commits to being real and truly sharing.
5.  Zag – a purpose that is noticeably and inspiring different to what everyone else says they are trying to do.

Get it right – and you have a cause that is powerful enough for hundreds of people to leap out of bed every weekday morning and get to work. They are quite literally looking to make a change to the world they believe in because, as Hugh MacLeod expressed it so perfectly, “Life is too short not to do something that matters”.

But there’s also another key role for purpose, and that’s in the marketplace. Professor Richard Ellsworth believes that purpose has a deep role to play strategically and competitively.

Purpose, he says, actually clarifies which decisions are critical and informs how such decisions should be made. If a decision does not tangibly shift the brand towards its purpose then it is essentially off-target or at least non-critical, and should be ruled on in that light. Furthermore, the purpose that a brand chooses is actually a significant point of differentiation. That purpose, he says, deeply affects how a company should choose to respond to the competitive forces around it and determines the degree that a brand’s strategies and goals can diverge from those of rivals who may be driven by different purposes.

In a world of increasing sameness, how you as a business intend to change the world, and the story you tell yourselves and others around that intention, is what will galvinise your people and distinguish you as a brand and a competitor from all the other brands claiming to be “good corporate citizens”.

I believe that the most powerful combination any brand culture can create is people who have a purpose to work to, a story that they agree on and a strategy that will help them get to where they need to be as a business.

So – four steps to becoming a purposeful culture and a purposefully competitive brand:

1. Give your people a purpose to fight for – something inspiring, something sustaining, something different from what every one of your competitors comes to work for.

2. Work as a business to build a story that will guide how you progress and that you can remind each other of, every day.

3. Create the strategy to get you from where you are to where you need to be, and put clear deliverables, action points, timelines and performance measures around each aspect of that shift.

4. Tell the world what your people come to work every day to change in the world. That way, your people will be more motivated than ever to making it happen – and your customers will support you because they too want to see it happen.

Further reading

• Market leadership: you can’t lead as a brand if you follow another brand.
• Seen and not herd
• Please don’t try to change your brand

Sense and Serotonin

Recently in response to a post by David Meerman Scott about the need to apply left and right brain thinking to content creation, I suggested in the comments that brands should apply that same approach to most aspects of marketing. As I pointed out at the time, blending right and left brain signals is critical to how brands engage with prospects and buyers because it ensures that people remain fascinated and justified as they make their way through the sales funnel.

Logic and magic.

I think most of us accept that consumers generally buy emotively and explain logically, so the ability to provide them with experiences that they enjoy and talk about, and at the same time to arm them with reasons that help them explain, to themselves and to others, what they are doing is critical.

It’s easy and tempting though to treat each hemisphere as separate: to apportion logical arguments for those who think that way or for times when they are needing to rationalise; and to ramp up the emotions and associatives for those who are more inclined to follow their hearts. We’ve tended to see them, in other words, as ideas that sit alongside each other, that co-exist, and that are accessed separately at different times, rather than as ways of thinking that are integrated.

Personally I think such a divide is too simplistic. I think the dichotomy is a construct that is convenient for marketers to believe because it allows us to build left and right-column strategies but it doesn’t actually address honestly how consumers make decisions.

Every marketer should thrive to inspire consumers to like their brand, rather than battering them with facts. At the same time, they need to qualify that emotive drive with this filter: Does it make sense for consumers to feel what the brand is asking them to feel?

The facts should exist as proof for the emotions – on the consumer’s terms. Because while the data may speak for itself to those who made the product, it cannot feel for others.

Increasingly I’m using two very simple questions to try and bridge what I’ve memed as Sense and Serotonin – and the way those questions are sequenced is critical.

The first question is one that regular readers wil know:

1. What is the most wonderful thing we want people to feel (that they don’t feel already from any of our competitors)?

It’s focused on finding what I often refer as the “unexpected value” – the thrill that the brand provides that takes people by surprise and has them coming back for more.

The second question is new – but just as interesting:

2. Where is the deepest proof that they should feel that (that they haven’t heard already from any of our competitors)?

That’s a hard one. It is about finding the “unexpected truth”, so it’s about formulating the sequence of fresh and compelling arguments that rationalises why consumers should allow themselves to feel the specific way the brand is asking them to feel.

“What are we going to do?”

It’s been said on too many occasions that actions speak louder than words. Said so often in fact, that many brands today seem to have a disregard that borders on disdain for taking the time to really think through what could make them outstandingly competitive.

In today’s manic, results-driven world, fewer and fewer people, it seems, feel they have time to strategise where their company and their brand needs be heading, and how to retain their edge. It’s better instead, they believe, to just get on with the business at hand.

Everything happens now. And as a result, considered is an idea that seems to have passed its use-by date.

Execution is the mot du jour. The best way to solve any problem is to do something. In fact, not just something, lots of things. Kevin Roberts calls this, “ready, fire, aim”. I call it stupid. Looking to reaction and sheer activity to get you out of trouble relies on the fallacy that doing something has got to be better than doing nothing. In fact, they strike me as equally dumb, because chances are that if indeed you are in trouble, you are where you are because of what you have been busy doing up until now. Indulging in more of the same action parallels having another drink to try and cure alcoholism. It’s just as likely to deepen the problem as fix it.

Remember that lovely moment in the TV series Blackadder when the General says they’re going to throw more men over the top at the enemy and take them completely by surprise. Captain Blackadder queries the surprise element of repeating an action that the British undertook “last time … and the time before that … and the time before that .. and so on” Precisely, says the General, and that’s why it’s so clever. Because doing what we’ve always done is the last thing that the enemy will expect us to do again.

As Albert Einstein once said “The definition of insanity is doing the same thing over and over again and expecting different results.”

The philosophy of act and adapt as necessary only works if you do actually adapt. (Even the British High Command came to realise that.) And the key reason why adaption is so hard is because action is easier. People can concentrate on doing what they know, what they have within their frame of reference, what they’ve been doing for some time. Action. And reaction. Getting through workloads. Getting things done. Following the other guy. Or not following the other guy.

Some decision makers seem to believe that if they act, they will get better at what they have been doing (which, incidentally, is often not that dissimilar to what everyone else is doing). That will also satisfy their KPIs – which often are built around actions not competitive effectiveness. Do more. Be more effective.

Polaroid did that. They made a great product. And that’s what they focused on. They were on a roll until digital came along and took the wind out of their sails. Suddenly they were becalmed. They’d got very good at being Polaroid – the problem was that the world had moved on, and now the thing they were so good at wasn’t noteworthy anymore. Polaroid, it seems to me, never had a winning strategy for the digital age. But, like I said, they were very good at what they did. I call this redundant excellence.

Their competitor Kodak had the same issue. Brilliance in the analogue world of photography actively prohibited them from making the changes needed to stay competitive. I have no doubt that over the 15 years that Kodak slowly deteriorated, everybody there worked hard. I have no doubt either that many actions were taken. It’s just that they were the wrong actions in the end because they were based on old thinking about consumers’ wants around their photos.

The irony is that Kodak were a first mover in the very market that would later kill them. In 1975, a Kodak engineer created the first digital camera, but for whatever reason they never took advantage of being first-out-of-the-blocks.

There’s a good chance both companies confidently met many of their KPIs along the way. But key performance indicators are not necessarily success indicators. They recognise actions the company thinks is important. But if those markers are out of alignment with what is required to actually be competitive, then a company may well meet its own goals at the expense of securing its future.

The ironies of this can be intriguing. One set of numbers – the financials – can be showing that things are not as they should be. Another set of measurements can be showing that people are doing all that is expected of them. When a management team is so close to what’s happening, it can be very challenging for them to agree that the expectations they set were wrong.

Market leadership: you can’t lead as a brand if you follow another brand.

Looks to me from this article like Samsung are going down the same competitive route as others before them in their battle with Apple. They’re looking to out-do them and to build a reputation and loyalty for themselves that replicates the following that Apple has.

Here’s the thing. As soon as any brand does this, there’s a very real risk that what it is actually doing is fighting with its perceived nemesis on their terms and therefore, subconciously or not, by their strengths. Because of the underlying references, Apple also becomes a focus and therefore, by implication, an authority. And all this within time and space that Samsung is paying for and looking to own. Unless they are very careful, there’s a real risk here that Apple could be allowed to Occupy Samsung’s marketing real estate – by Samsung itself.

After all, Apple is very good at being Apple. And their consumers love them for the brand they are.

It’s not smart brand strategy to address a strong brand competitor at their strongest points. If I were working for Samsung, in fact, I would be actively encouraging them to avoid any reference to their competitors. Rather, they need, in the words of Fleetwood Mac, to go their own way. The most powerful brand you can own and manage is one where you know and write the code – not one that takes its cues from where others are, or where you perceive them to be.

That’s not to say that any brand should ignore its competition. But rather, in my view, a brand like Samsung should use its competitive analysis to sort out things like the emotions that Apple and others don’t evoke and whether these represent opportunities for emotional equity.

The question is not, “what does Apple do well that we can do also?”. The question is “What can’t our competitors do that we can excel at?”

The real lesson that Samsung have taken and that they do need to pay attention to is that products are upgraded by repeat customers motivated as much by loyalty as technical introductions. Apple’s very good at that. But the way to beat them is not to look to emulate more of the same emotion.

In the tech world particularly, if Samsung is to have any hope of achieving its goal it will need to match technical innovation with emotional innovation.

Emotional innovation stems from finding what I term the “unexpected value”. It’s driven by this line of enquiry: “What is the most extraordinary feeling that people in this sector haven’t felt yet? And how will we deliver it to them?”

When you strategise and deliver a brand underpinned by unexpected value, you change the emotional landscape that you compete in and you sidestep the cluttered, increasingly emotive middle ground that your commoditising competitors are squabbling over. You also actively avoid reploughing the deeply owned and highly branded field of another. That’s how you build market leadership. That’s how you continue to lift brand equity. By owning and fuelling emotions that are increasingly and delightfully associated with you.

Thanks Todd for the heads-up.

Participation versus differentiation

Right now, across the world, hundreds of different people are opening an office, a restaurant, a social media company … They’ve sunk everything they have into it. They’ve thrown their life at it. It’s what they’ve always wanted to do, and every one of them and the people who has supported them hopes and believes they’ll succeed. Most won’t.

Right now, somewhere in the world, someone is planning a business that will one day be bigger than every other brand in their sector. The next shipping magnate woke up somewhere in the world today, without a ship to their name. The property magnate of the future is eating lunch in a schoolyard somewhere. Tomorrow’s Madonna has a clothesbrush, a mirror and perhaps an i-Pod …

The contrast couldn’t be greater, and yet curiously, the two groups are interdependent. Because in order for someone to stand out in a market, the vast majority must fail to do so.

If every café that opened stayed open, the hospitality sector would collapse because no-one could succeed, no-one could expand. Same with fashion, hairdressing or education. Unless you’re working in a market that just continues to enjoy extraordinary organic growth, attrition is hard-wired into the functionalism of the capitalist system. People have to run out of money in order for the money to be made elsewhere. People have to stop booking one airline in order to consistently fly on another. Someone choosing your hotel didn’t choose another hotel. Most of the time, the dynamic is zero-gain. In many sectors, it’s shrinking.

It’s your business against every other business in the market.

What never fails to amaze me is how so many businesses believe they have what it takes to beat the odds. Their formula for success? Participation. They’ll open the doors and chance it against the stupidity or inefficiency of their competitors. That’s it. They’re utterly dependent on passion, hope, hard work and perhaps the advertising budget to outshine the hundreds, perhaps thousands, of others who will open their doors on the very same morning at the same time to tout for the same pool of business – the veterans, the emergents, the strugglers, the other newbies. And on every other morning from then on.

It’s a dynamic that every business faces, no matter how long they’ve been in business. If you’re new, you’re needing to make your mark often against very established players. If you’ve been in business for a while, statistically the odds are tilting against you even though, ironically, you may be feeling secure in the knowledge of your history.

The sad reality for many brands, if they have looked to face up to the brutal reality of competition, is that they’ve probably done it by confronting the wrong question.

This is the wrong question: “What will we do if we fail?”. It assumes participation.

This is the right question: “Why won’t we fail when so many others must?” It requires differentiation.

If you can’t answer the right question, you’re a casualty. The only question left is one of timing. If you stop asking the right question, you’re also going – no matter how long you may have been in the game.

For your information: why so many brands are not listened to

The insurance company wrote to me again. That can only mean it’s a bill or a change in policy. Either way it’s more expensive – literally, because I’m paying more, or metaphorically because I’m getting less for the money I do pay.

I’ve lost count of the number of meetings I’ve been to where marketing managers in the financial sector and in utilities have told me that they are keen to build closer relationships with their customers. They want more loyalty, they want customers to engage with them. Everyone nods.

But then their customer service teams keep sending out the same bills and policy changes, and they wonder why they don’t have more likeable brands. It’s not rocket science. In fact it requires something much more daunting. A change of heart.

In order to relate to customers as people, insurance companies need to start thinking of those customers as more than named policies, phone companies need to see them as more than accounts, electricity companies need to see the people who pay their bills as more than bill payers.

If brands in these sectors want people to associate them with more than just money, then they need to have conversations with them that extend beyond money. And for many organisations in these sectors that’s very, very difficult – they have nothing else to talk about, because their culture is honed to think about nothing less. It’s not that they are usually particularly greedy or even obsessive. It’s just how they have always talked to customers – as customers, rather than as people.

But the relationships between customers, services and experiences have shifted massively with the maturation of social media, and will continue to do so. Not long ago, people were sold services, and experiences were a value-add. Increasingly, people buy into the philosophies of likeable brands and then expect validation of that worldview when they purchase products. That validation comes through the experiences they receive when they buy and the ways that the brand itself looks to engage with its customers.The things it talks about socially. The causes it supports. The subjects it is interested in. The areas it engages with in the media.

In a pre-Google world, where it was so much harder to access data, brands provided information and people saw that as a cornerstone of the experience. We judged brands by their ads or their correspondence for example – because it was so much harder to judge them any other way. In an online-centric world, brands need to prove they are likeable and offer experiences that people are interested in across a wide range of fronts before anyone pays much attention to the information that brands want to send them.

And without that buy-in, the information itself is considered worthless. It’s something people ‘have no time for’. They’re too busy – read, they’re too busy to give whatever it is their time.

Here’s a great presentation by Steve Dimakis, the Senior Media Planner at MEC Wellington using research done by Argyle Social on just how much brands need to be thinking about as they engage with consumers, particularly in the emerging social channels.

How to do Social Media

But engaging like this, in ways that encompass but also extend beyond the business relationship, are a massive disruption for conservative institutions. Imagine a general insurance company having to think about and talk about motorbikes for example instead of just focusing on motorbike policies. A specialist insurer might do that, but for a general deliverer, that seems too hard. Which is why these companies revert to what they do feel comfortable talking about and why customers revert to believing that’s all they want to talk about.

An explanation in writing, however nicely phrased, of why customers need to pay more for their policies is not a conversation. It’s not even interesting to the consumer. It’s just more correspondence. It’s paperwork. It’s another brand talking about itself on its terms. And that, consumers find, increasingly socially unacceptable, in the broadest interpretation of that idea.

What likeable brands recognise that other brands do not is that they need to earn the right to talk with people. They don’t automatically have that right. Or rather they may have it technically, but they must keep earning it emotionally.

Related articles

• Likeable brands: Debating the true value of Likes.

Likeable brands: Debating the true value of Likes.

If brand owners are buying Likes on Facebook, what are they actually worth?, asks Alexis Dormandy in this recent article in The Telegraph. “Can we really value a ‘Like’ or a ‘Follow’ when so many of them are bought rather than earned?”

Dormandy’s question goes to the heart of the marketing community’s ongoing fixation with volume and to the business world’s fascination with social metrics. With marketing managers under huge pressure to build and participate in scaled brand communities, perhaps it’s inevitable that fast-track approaches to ramp up fan bases have become more popular.

There’s good, bad and ironical news in this.

Let’s start with the good. Slowly a real value case for using social media seems to be emerging. In a recent post on the RICG blog, comScore’s Linda Abraham and Buddy Media’s Mike Lazerow reference research showing that a “share” on Facebook can lead to $2.10 in incremental sales, and drive up the average conversion rate to 10.2 percent per share.

A key reason Abraham and Lazerow give to factor social media into digital marketing programmes is that “social media is the No. 1 online activity today,” accounting for almost 20 percent of the time consumers spend online.

They go on to say that there are three steps in social media marketing:
1. Cut-through, or the brand messages that fans receive in their news feed;
2. Engagement, or what fans say about a brand or product’s news feed content; and
3. Amplification, where fans share the content they like with others in their network.

However, they also point out that “most brands skip over those “intermediary steps,” and instead think the process only involves getting fans and then seeing a marketing ROI”.

And when getting fans involves buying their loyalty through incentives, that’s when Dormandy seems to believe the illusions of success start. Yes incentives and giveaways work, but as his article points out, generating Likes and Follows through mechanisms like contests rather than through unprompted affinity must beg the question: how much do consumers truly see these marques as likeable brands and to what extent are they more interested in the likeable giveaways?

That in itself raises a wider concern. The bad news.

With the introduction of marketing moves like Sponsored Stories and the use of incentives to gain community memberships, reviews and WOM, there’s a very real danger that authentic endorsement – the sort members of the online community truly value and want to share – is under threat. As Dormandy puts it so well: “for products, services and brands, the Facebook Like provides little indication of what your friends want or would recommend. In the quest to be endorsed on Facebook, brands have devalued those very endorsements. Buying a Like doesn’t mean you’re liked.”

So Like could no longer mean ‘like’ in its defined sense. And Follow could easily mean Follow for Now, or until the competition ends. There’s a transience to that commitment that is disquieting because by extension endorsement no longer means endorsement either. It simply means participation.

If that’s the case, what are marketers buying beyond a momentary measure? What can they bank on?

And is the very fact that they continue to seek out Likes and Follows making Liked brands less reliable and Followed brands less charismatic?

Leading perhaps to this irony: the more consumers Like your brand online in the minute (because of the incentives you offer), the greater the risk that they might not actually value it over the longer term.

Not dissimilar in many ways to how consumers behave in sales – it isn’t the brand they are buying, it’s the discount. Only in this case, it’s not about the discount but rather the incentive.

The invisible language

My friend Simon is a designer. One of his favourite lines is “Great kerning will save the world”. Chances are if you’re an art director or a designer or, if like me, you work with art directors and designers every day, you’ll find this amusing because it references a whole bunch of things about the discipline, the passion and the perspectives of those committed to impeccably forged design.

If you’re not a designer, you probably didn’t even grin. That’s OK. It’s not your dialect.

Language is about so much more than communication and meaning. It is filled with ideas and references that to some extent reflect the worldviews of those who enjoy them. People preserve those tenets in all sorts of ways. Some they jargonise; others they culturalise or instinctualise.

The acronyms are the easy part, because they are immediately confusing and confronting but at least they’re visible. I think the hardest thing to understand about any new sector you’re trying to market to is the embedded meanings, the invisible language, what goes without saying.

Staring at stars

The temptation to excel at what you do and, just as importantly, to be recognised for that is huge. It’s not always a good thing. Last night, finally got a chance to watch Michelin Stars – The Madness of Perfection, William Sitwell’s look at how a guide that started out as a simple way for motorists to find something to eat has evolved into a gastronomic obsession that makes and breaks restaurants and chefs.

(The Michelin star story itself is actually an amazing story about the evolution of a brand, but I digress …)

I saw immediate parallels with the advertising and design industries, where the drive for gongs can be equally strong and can also lead to an obsession with detail that any beyond the industry, and many within it, simply do not see, and certainly do not care about.

As one creative director used to say, never forget that most consumers are watching your “art” with their tea in their lap. In other words, they have no interest in the kerning of headlines or the particular way that a photo was retouched or the animation technique you used to curl the logo through the open window of a car speeding at 140 km/h over an ice face … They’ve just waiting for the next bit of the news.

The temptation though for creative marketing people, just like with chefs, is to shift the goalposts to align with what the industry is looking at rather than what the consumer sees; to become so interested in ‘getting it right’ (supposedly for the customer) that ironically the whole point of the project – to tell a story to a consumer in a way that makes them feel impelled to act – gets drowned in a surge of technical amazement.

Of course there’s a payback: the right to put a credential beside your name, and maybe a cup on your mantle, that so many others cannot claim. At least not this year.

Exclusivity is a siren – it distracts people, some of whom are already amazing at what they do, to hunt for that amazing song. In the case of Michelin, the Sitwell programme suggests, it even takes some out of the world of bringing people happiness (the whole point of cooking) and into a world of relentlessly seeking credentials. The plot is lost. So much so that, as Marco Pierre White pointed out, these culinary adventurers don’t even cook anymore. Instead they pursue empires built, in the case of Michelin endorsement, on one, two, three little macaroons on a page. Empires that surge and ebb on the basis of those little marks – as diners too feed on the Michelin mania.

I’ve certainly got nothing against prizes. I am a radical meritocrat. But it is one thing to win for your work, and quite another to work for what you will win.

My job as a marketer is to make people fall in love with inanimate objects. Nothing less. But, as the programme last night reminded me, nothing more either.

Tying brands up in knots

Three things all of us probably need to spend more time thinking about:

1. A burgeoning moral factor that is becoming more militant – brands are expected to behave ethically, responsibly and sustainably, and part of that moral exploration seems to be veering towards finding ways to supply goods at competitive prices in ways that do no harm … to anyone. For an economic system that has always depended on having winners and losers, that’s a huge swing.
2. The commoditisation of loyalty (not just product) – the growth of world class and best of breed systems haven’t just encouraged sameness, they’ve also slashed the risk of shifting from one brand to another. If product, service and risk are basically the same, consumers have little or nothing to lose by changing allegiance. Consumers are not just disloyal in some sectors. They are becoming increasingly disloyal in every sector.
3. Resentment of profit – as consumers have suffered through the GFC, their expectations for companies to deliver them more and more “value” have increased. Give “me” more, even if it kills “you”. Everyone wants full service. No-one expects to pay full price.

I’m confident that each of these dilemmas is addressable on their own.

The knots form in trying to tackle the collective and simultaneous effects of all three.

Leaning away from the list

Further to the last post on Michelin.

Over at The Domino Project, Seth Godin and his team are clearly having the same misgivings about the publishing industry – that when you work to a prize (in this case a place on The New York Times list) that prize can have a huge influence on swathes of what you do, and the influence isn’t necessarily positive. Here’s two excerpts from their piece on why they will not be courting popularity with The New York Times Bestseller List:

If you publish books (or write them) aimed at a mass audience, the Times list is never very far from your focus. It’s not just an indicator (the proverbial canary, indicating what’s going on in the mine) but it’s also an amplifier, a spark that can lead to ever more sales, conversations and credibility …

… But there’s a cost. The cost is that you have to write differently, promote differently and do business differently. Simple questions about rollout, promotion, pricing, packaging, titles and distribution sooner or later come down to, “will it hurt us on the list?”

Circling …

Great products sell themselves. No they don’t. But equally, people don’t just buy brands either. Today’s customers are for the most part far too sophisticated and informed to buy generic-quality products with a nice or familiar name attached to them and a decent media budget.

What people buy, and pay for, is stories – and in order for those stories to resonate, everything that reaches customers needs to ring true. Product, service, distribution … All are inseparable components of the brand story because they collectively contribute to how people feel. They bring the story to life. They give it credibility. They provoke engagement and emotion.

Sometimes companies with iconic brands forget that. They somehow believe that because the branding process can add margin, brands must equal margin. So they figure they can nip or tuck one area, two areas, three areas, and still everything will be OK. The margins will hold if they still have brands. Wrong. So wrong. Brands can only add margin when everything else is right. That’s the lesson for Johnson and Johnson and so many others.

Make a promise. Deliver on it.

Get it right and the circle is seamless. Get it wrong and the circle is vicious. Because when you don’t pay attention to delivering on every detail of your story, the story itself is compromised. Your brands degrade. To names.

Instead of a portfolio, all you’re left with is a list.

Making the list longer or wider doesn’t add diversity. It’s not a segmentation strategy. It just adds complexity, cost and confusion to what is now a catalogue.

A simple human truth soon kicks into play. If you don’t give people valid reasons to pay more, they won’t.

Distinctualising: getting purely personal

It’s one of the great myths of the New Zealand tourism story that we have great scenery. But only in the sense that it implies other countries do not. Or that’s is all New Zealand has.

Of course we have eye-wateringly beautiful sites, as anyone whose been here or lived here can attest. But so do many other places in the world. Chocolate box is global. Just like sheep. And fruit.

Many years back when I worked on the strategy that would lead to the 100% Pure programme, I remember a great presentation where we showed people scenes from around the world and asked them to identify where they were. It was sobering for all concerned that many of the places that were “unmistakeably New Zealand” weren’t in fact here at all.

What was here that everyone raved about was the emotional reaction people had to what they saw; the warmth of New Zealanders themselves; and the amazing stories that sat behind what people witnessed.

I think Tourism New Zealand have done a great job with the 100% Pure campaign to date. It’s turned New Zealand into one of the most exciting places brands on the planet against some incredible, and massively funded, competition. But I’m also looking forward to the next, more personalised iteration.

What gives New Zealand its real edge as a tourism destination is not our creativity or our proximity to the dateline or even the fact that we play the world’s toughest rugby (much as those ideas enthral New Zealanders themselves). The real offer, the massive enticement in the external conversation, is NZ’s extraordinary mix of geology, anthropology and mythology. Not one element. All three. That combination of ideas really sings to visitors when it’s brought alive with Kiwi hospitality and honesty. We can make more of that, in my view. A lot more.

It’s something to remember as the crowds disembark here in September for the Rugby World Cup.

This year, if we don’t just want to be another games’ venue in the sports calendar of life, it is time to make the stories even more personal and distinctive – from New Zealand as tellers, for visitors as listeners. Because that is what people want to share. Getting Facebook-friendly is all about the transition from available to remarkable (in the literal sense of getting people to remark to others about things they haven’t seen or felt elsewhere).

That’s not just a tourism thing, of course. Increasingly it’s a mandate for all globally competitive brands. You can’t just participate. You have to distinctualise.

Work in progress

Didn’t work – Something was tried, and for reasons known or unknown, results were disappointing. Doesn’t mean that the same outcome would happen again, or that whatever is being proposed shouldn’t be tried again. This is a statement of history, often made blithely without the investigation of context, input, resource, influence or wider climate. It presumes a track record of past and therefore continuing disappointment.

Won’t work – Doesn’t mean it can’t work or that it hasn’t worked or even that it’s not working now, only that it will not work in the future in the way it is being framed or the way things are projected or with the allocated resources. In other words, it could work but it may require revision going forward.

Can’t work – Unfeasible. You’d have to be a fairly confident person to be making this statement. It states categorically that something will not work no matter what happens in the market, with customers, to the business, within any timeframe. Never. No debate. No right of appeal.

Will never work – Sounds definitive, but it’s usually subjective. It says that the person appraising this idea cannot imagine it working. They cannot see beyond the boundaries they have placed around the idea or the environment within which it operates. There’s an inherent fear of failure; a built-in shut-down mechanism that is keen to stifle any hope that this idea might even get an airing. An immediate change of conversation is signalled through tone and body language.

Four very different judgments spread across the full array of timeframes – and yet so many decision makers end up treating them as interchangeable.

Each one provokes exactly the same reaction. In today’s risk-averse corporate world, they all cultivate doubt. They all generate a “responsibility” to delay, fudge, detour, pass the buck, send this back for another rethink, put it into committee, investigate further.

They all buy time because what almost everyone immediately hears is ‘not now’.

And that’s how things get stuck.

Think back to the last feedback someone came to you and suggested “we” not go ahead with something. What did they actually say?

Job satisfaction

The next time you’re bored at dinner, here’s a discussion guaranteed to re-animate conversation. Simply ask “What do you think is the world’s most unnecessary/useless/over-rated job?” (choose any option – they all work).

The night I asked, suggestions came thick and fast. And most of the reasons people gave for disparagingly rating jobs the way they did fell into clear categories:

1.       Do nothing

2.       Add nothing

3.       Cost a lot and do nothing

4.       Talk a lot and add nothing

5.       Why do they bother?

6.       Think they matter but don’t

7.       Complicate everything

8.       Superficial

9.       Lack ability

10.   Lack personality

11.   Clueless

12.   Ruthless

13.   Make no difference whatsoever

14.   Pen pushers

15.   Grizzlers

16.   Vultures

17.   Leeches

18.   Bullshitters

19.   Fence squatters

Interestingly, a number of vocations received ratings in multiple categories.

How do you think other people see the work you do?

Are they right?

My thoughts on developments at MySpace

Another reminder this week that the social media space – just like every other market – is not one consistent goldfield. While the likes of LinkedIn and Facebook continue to build powerful brands and potentially public business models, MySpace has lost a lot of ground, and much of what I see here takes me back 10 years to the boom and bust of the dot.com times. Some parallels I noticed:

1. Participation is not enough. If you don’t have a distinctive, clear and evolving money-model for your brand, it’s not enough to be in the same arena as those making money. You will be overshadowed and outperformed. Cash cows are grown, not born.
2. The purchase price is no guarantee of anything. In the case of the $580 million that News Corp paid, it’s not even a barrier to entry for others. It just means you paid a high entry fee based on a perception of what lay ahead. There’s a recurrent warning in there too for valuing “new models”. In terms of fundamentals, there are no new rules.
3. Another thought that harks back to dot.com. While the acceleration rates for online businesses can be amazing, their brake speed can be equally dynamic. The model is community powered – and the assessments of value and potential are often based on those numbers. But if the community leaves or is distracted elsewhere in sufficient numbers, momentum dies. This is perhaps as close as one gets, so far, to a ‘frictionless’ market. There is nothing to lose as far as visitors/customers are concerned. Leaving, just like arriving, is simple, quick, painless and, at a time when connections are instantly reset at the new congregating ground, non-consequential.
4. Resources are costs not reassurance. If MySpace think they can run still business on half the staff they had, and get it ready for sale, why did they have so many staff in the first place? Did they need them now, or were they arching for the future. And what does that now hand potential buyers or partners – a streamlined opportunity, a going or a concern?

One to keep an eye on.

Sometimes personal branding sounds a lot more like luck strategy

Every so often, and at the oddest times, I’m reminded of just how big the world is and how competitive and diversified most sectors really are nowadays. Airports have that effect on me. So many flights to so many places, with so many people waiting in lounges to do deals, pitch ideas, sell products, hold meetings, clinch finance …

Bookstores. If you’re a writer, and you have any thoughts that your next ‘masterpiece’ will somehow make you millions, it’s easy to look at Amazon and see what you’re up against one screen at a time. But step inside the doors of a Borders and look up and around. That’s a much more realistic impression – floors and floors and floors of books, magazines, videos. And those are just your visible and published competitors.

Conference itineraries. If you have ambitions to speak for a living, search even the conferences you know about and just look at the quality and quantity of who’s making the roster. If you’re just another speaker on a standard topic, you’re part of a very long queue.

The case against being a generalist is everywhere, if you look for it. And contrary to what the ‘change your life’ movement might have you believe, the universe is not waiting around looking to hand you out favours or tickets to the fast-line.

There are tens of thousands of authors. There are many thousands of speakers. The world is clogged with people capable of doing meetings. For every market demand, there are hundreds, sometimes thousands of people, trying to win the right to supply.

Most people seem to follow one of these progression strategies. They:

1. Train in an area that’s going to grow anyway, and hitch their wagon to organic expansion.
2. Specialise to the point where the competitor pool is more manageable and/or someone sees a business opportunity in promoting their case (be they an agent or a recruitment consultant).
3. Carry on with what they’re doing and just hope you’re lucky – that somehow you’ll get selected.

Incidentally, relying on your talent, qualifications, looks etc is often a variation of 3. So is going to a business school and doing an MBA.

And so much of the hoopla that I see around personal branding is also little more than a systematised version of 3. It’s essentially a luck strategy with some social media support. It relies on telling yourself and others what you do, without any real attention to those much bigger and more powerful, but abstracted, market realities, and then waiting for the phone to ring.

I can see why it’s popular. The whole American psyche traditionally revolves around that approach – if you believe in something and work hard, you’ll get the rewards. But if there’s insufficient market demand and/or the supply lines are saturated and/or you are just another anything, there’s no reason to presume your ‘brand’ is going to be chosen no matter how searchable or optimised you are. And when the competition pool is global, the going of course gets even harder.

Option 3 is a crowded platform for a reason. It’s the easiest one to board. And you only need to look at the application numbers for reality shows to see what I mean. So much hope assembled in one or more places at one time hoping that somehow they’ll defy all the odds and make the grade. People who think that being noticed is it. “I’m a singer/cook/model, I really want this, I have the voice/recipes/figure … pick me.”

Setting aside the fact that the reality of any career is far different from its perception, the roles that so many people clamour for and believe would make life so much better seldom happen by chance. Sure they capture the imagination – and there are just enough exceptions to keep the myth machine humming – but it’s sobering to remember those careers are called ‘dream jobs’ for a reason.

Just standing at the platform – even with a very real sense of your personal brand – doesn’t catch you the train. To paraphrase Kylie Minogue, you should be so lucky …

Plotting what counts

Interesting isn’t it how we see numbers. I was reflecting on this yesterday after someone made the point that whilst all of us would agree that words tell stories, we tend to forget that numbers tell stories too.

Instead, we class numbers as facts or patterns or targets or science. We use them to add logic, objectivity, reinforcement. We make them a goal in themselves. We ask our people to report to them.

But the numbers are not the business. They reflect what’s happening in, around and for the business. And they won’t fix themselves.

They are a storyline – of growth or decay, belief or disbelief in the on-going value of something, levels of demand, people coming together … And what I always try and do is to link them that way. This isn’t a 5 year sales comparison, it’s a movie script. What is this P&L telling me has happened so far – how, why, and where were the turning points?

I find that when you do that, you’re soon looking behind what’s in front of you to what is going unsaid. As marketers, it’s easy to overlook the fact that so much of life goes unannounced. People don’t always tell you much. But they do leave crowd markers – collective surges and ebbs that serve as the emotional evidence that something has happened for them. Some are more obvious than others.

Often the fastest and most effective route to the solution lies in finding the humanity in the problem.

Coffee’s cold …

I’m getting some mixed messages off Starbucks’ decision to par its logo back to an emblem. I’d like to think this is a sign of evolution. And at first glance that’s how it looks. Dolly up the icon, drop the name, drop the association with caffeine. Simple, clean, single minded, international.

On reflection though, I’m more than a little concerned that Starbucks have once again lost their way and are trying to bridge their way to another strategy. I just can’t for the life of me put my finger on where or why.

The market’s already been told that Starbucks is looking to diversify. This from the company blog dated 5 January:

“… we see a world in which we are a vital part of over 16,000 neighborhoods around the world, in more than 50 countries, forming connections with millions of customers every day in our stores, in grocery aisles, at home and at work. Starbucks will continue to offer the highest-quality coffee, but we will offer other products as well – and while the integrity, quality and consistency of these products must remain true to who we are, our new brand identity will give us the freedom and flexibility to explore innovations and new channels of distribution that will keep us in step with our current customers and build strong connections with new customers.”

That sounds like expansion but smells like a straddle to me.

So they’re not abandoning coffee but they are looking to move beyond it and in so doing to attract new customers. Are these new customers people who don’t currently drink coffee? Or perhaps people who don’t want to drink Starbucks coffee? Or people who don’t drink enough Starbucks coffee and need something to go with it?

Ten points for faith in their brand equity, but as Nigel Hollis observes in a blog entry at HBR:

“If you intend to invest heavily in offerings outside the coffee category then removing the word “coffee” is logical. For that matter, if coffee is no longer to be the core of the brand, it’s logical to remove the word “Starbucks” given how synonymous it has become with coffee. But  … If the name “Starbucks” is so strongly associated with coffee that you have to remove the name in order to launch another product, does that not suggest that the corporate strategy is out of synch with customer understanding?”

Absolutely.

Here’s my questions. The next step after moves into music distribution and instant coffee is what exactly … and where does that lead that isn’t crowded already? If we are indeed seeing a prelude to ‘the beverage formerly known as Starbucks’, which market is Starbucks going to step into that makes sense post-coffee or alongside coffee, isn’t coffee, is Starbucks enough to be Starbucks friendly without being Starbucks already, is profitable enough for Starbucks to see opportunities in yet doesn’t have plenty of powerful incumbent brands that would give the new entrant grief, and somehow hungers for products sporting the streamlined Starbucks mermaid? Food? Doubt that’s not very competitive.  Alcohol? Wow. Can’t see it myself. Electronics? Hardly. Sport? Um …

And if Starbucks feels the need to move substantially away from all that they’re known for (despite the assurances, this does feel like quite a departure philosophically), what equity are they actually banking on to make headway in such markets anyway? Where’s the proof that anyone will or should believe that passionately in a non-coffee Starbucks brand? What’s in it for them?

And if they don’t – then what?

Am I missing something or with this seemingly nonchalant identity change, did someone just bet the company?

The difference between next and again

Why have all the sequels that have been planned to the Rocky Horror Shows either not been made or have flopped?

The obvious answer is they couldn’t live up to the original. I suspect the real reason though may be a little more subtle – they couldn’t reach the spirit of the original. Because, in the meantime, circumstances changed. Other films and musicals were made. People got to a point where they had done that – still are doing it all over the world every weekend – they just didn’t want to do a variation of it.

It’s a dilemma that every successful product faces. Something wins – now what? How much of what you had do you keep? How much do you revamp? What stops 2 being too? In the case of Rocky Horror, the storylines were just as wacky, many of the characters made a return, author Richard O’Brien was still involved … and yet …

Rocky Horror worked brilliantly. The numbers say it’s still working. There are facts, but there is no inference.

Next does not mean again.

It’s not over, but it is done.

Flogging a dead Playhorse

Brands retain value from their legacy providing they are still seen as relevant and interesting, providing they are still competitive and providing they retain goodwill. Or if people have had enough time to forget why they failed in the first place.

In other words they can recover if they have enough momentum, or they can be reborn on the back of nostalgia, but once they’ve flatlined, and particularly if they have been in that state for some time, they can be very difficult to resuscitate.

Take the case of the Playboy brand. It’s powerful, sure. And it does have significant heritage. It’s logo is recognisable anywhere and there is huge history there. But can it just continue to trade on the value it had? Doubtful. It is, as Adam Gordon rightfully points out, “a classic failure of industry foresight” and even though Gordon observes that “Brand is value stored up in the past to be reaped in the future”, I don’t share his apparent optimism about the brand.

Playboy cannot realistically expect to carry on as before and succeed under changed management. Declining sales would suggest to me that Playboy is no longer relevant, no longer competitive and its goodwill is running out fast. In fact, it has probably already traded on its past for too long.

That’s why I also don’t understand the company’s stated strategy to now transform itself into a brand management company. Who would pay hefty license fees to associate themselves with the name? And – the same question I asked about Starbucks – what sectors is the name going to add value in that aren’t already brimming with powerful, relevant and competitive performers?

As for Hugh Hefner’s decision to re-privatise, sure he gets to take his beloved company away from the unrelenting public gaze, but what exactly is he regaining ownership of?

Every Rome has its day. I would of thought this was no time to be taking up the fiddle.

There’s a language for that

My lawyer friend Nicola used to say that a sure sign of a market coming of age was when the litigation started. I suspect she’s right. In which case, Microsoft’s petition to block Apple from trademarking the term “app store” is perhaps a sign that many can see a very bright future – perhaps the future – in this idea.

Having successfully quartered “there’s an app for that”, Apple clearly identified, way back in 2008, that when you have dibs over the language around a concept, you potentially get to own the mindshare around that idea as well. You essentially force others to express their offering in language that the market sees as stemming from you. (The fact that an “app” is an abbreviation of Apple – coincidental or not – is inspired.) That of course is what Apple are so keen to protect and Microsoft so determined to challenge.

Leading the conversation is hard. It’s risky. There are so many things that can of course go wrong. But there are benefits. You get discussed a lot, even if, in the case of Apple, you don’t have a significant social media presence of your own. And you get to decide and define the terms and ideas that frame how the world talks. Word of mouth – quite literally.

Pass the salt

Once, salt was one of the most valuable commodities on earth. Usual supply and demand dynamics: plenty of need because of its preservation skills versus hard to find.

Over the centuries, it’s been a form of treasure, a trading currency, the cause of wars, a builder of empires and, in the case of Ghandi, a catalyst for protest. Today, it sits on a shelf in our supermarkets and we’re warned not to include too much of it in our diets. We don’t give it a second thought.

The modern equivalent of such a rarity is probably time.

Ask anyone how much free time they have these days. Most will tell you they don’t. They haven’t got time to do this or watch that or attend something else. They have so much to get through. And yet, according to Fast Company, Americans are spending more time on Facebook and Twitter than ever before: more than 2 hours a month on Twitter; more than four and a half hours on Facebook.

It’s fine. It’s enjoyable. It’s part of life.

And they’re not just talking for a minute here and there. The average user now visits Twitter 10 times per month for 13.1 minutes per session on average, and Facebook a little under 12 times a month for 23 minutes and 21 seconds per session. And it’s increasing …

Time may well be the new salt – but people will stay somewhere if you give them reasons to linger; reasons that seem more important to them than moving on. Somehow, people “find” the time.

Conversely, any time that feels like it could be better spent elsewhere is waiting time. And waiting time is like the stuff on the shelf – all too common, unprized and something we’re all telling ourselves we should have less of.

The genius of Starbucks’ “third place” was that it recognised that: people would rather spend time in a café than in a traffic jam. So Starbucks invited them to come in earlier and spend the extra time having coffee instead. Or drop in on the way home instead of heading straight for the crowded train.

Apps are going the same way – something fun to do, have or play with that make the less exciting moments more valuable.

It’s a challenge most of us could throw at our business models. The question is not how can we get our customers to spend more time with us? But rather – what can we offer them between the order and the delivery that feels less like waiting?

How do you value a crowd-based brand?

What is the value of global friendship and can you actually assign a price to it? Facebook’s own stats say that the site now has more than 500 million active users, and that 50% of them log on to Facebook in any given day. That means Goldman Sachs’ implied valuation of $50 billion suggests every active user is worth around about $100.

Is that a lot? I actually don’t think it matters. The much more interesting question is: $100 – to whom? Users are not paying money to talk to their friends, post their photos and catch up on what’s going on as they generate content on Facebook, but if Goldman Sachs is right, then that’s what their millions of activities will generate for someone else.

So who’s anticipating the $100 of value, and just as importantly, how? Investors, yes. But based on the production of what?

There have been any number of comparisons between Facebook and Google – but to me, they overlook a fundamental difference. Google does produce something: a very powerful search engine, based on a ‘secret’ algorithm. Facebook is much more of an environment.

Facebook’s valuation is about 25 times revenue for 2010 according to this article in Bloomberg (that means Goldman Sachs would have to wait 25 years to even draw even on the top line) and, perhaps inevitably, that’s generated bubble talk. A quarter of a century is a long time for any business. In the world of online commerce, it’s unprecedented. So perhaps it’s no surprise that an article in Fast Company reports that 69% of investors who took part in a Bloomberg global poll thought that Facebook is overvalued. Just 10% thought it was “properly valued”, 4% thought it undervalued and, interestingly, 17% (a little under one in six) had “no idea”.

I asked Mike Tisdall about this – and his view was that the extended timeframes only apply of course if the current year’s profit remains static. His view is that Goldman Sachs are counting on that profit growing exponentially over the next few years. Yes, Facebook’s profits have grown in recent years, but $500 billion’s a long road don’t you think?

Conventional market wisdom of course says the value of a Facebook-type offering will commoditise. But then, how does commoditisation play out if users are paying nothing now?

The only way that I can see it happening is if those expecting to receive $100 of value per user now (and presumably more over the years ahead as the numbers swell) come to believe that target is unrealistic. Patience could well be a factor – if they become impatient, what price would they take to get some return on their investment? And how would that affect the markets?

There are of course any number of other factors that could jeopardise value, triggered not by the investors themselves necessarily, but perhaps by the community – a sudden exit via a shift in fashion, for example, a spooking based on concerns about privacy, unexpected disclosures or new moves by Facebook (perhaps to reinforce the value in the business model) that participants find unacceptable.

The other thing we can’t know is what’s the critical exit rate? If 10% of regular users left, would that take the momentum out of the business model? Would it take 5% – or 15%? The lesson from Tunisia and Egypt is that once crowds get going, things happen pretty quickly.

Then there’s the whole situation of an environment like Facebook going public – does that mean that if its market price does go up, participants are essentially working for the institutional investors for free? Or will the IPO itself be crowd-based? In which case, governance could be interesting.

I foresee complications.

And the temptation to return to the conversation we had ten years ago – that one that starts it’s a different business and therefore traditional valuation models don’t apply. Remember where that one landed? Come to think about it, remember where we’ve just been? That was all about valuations too as I recall.

The delicious irony of a crowd-based brand, and something to keep an eye on with the proposed social media floats, is that brands such as Facebook, Groupon and LinkedIn become both stronger and potentially more vulnerable as they grow. On the one hand they are looking to consolidate and express value on the board; on the other, they rely for participation, validity and volume on a dispersed community whose views and reactions to going public are the real speculation.

 

 

Refreshing the connections: a perspective on The Pepsi Refresh Project

It’s great to see Pepsi deciding to spend money over a year in communities instead of splashing the lot on the Super Bowl. It certainly makes sense at one level. Conscientious consumers are asking corporates more and more questions about where their money is being spent and how committed they are to the people who buy their goods. On that score, this is huge.

And it certainly lays down the gauntlet in terms of challenging corporates to think about where they put their money. Top marks for that too. The ultimate Pepsi challenge.

It’s a move that has huge feel-good. Let’s face it, what’s not to like? Pepsi’s given away more than $20 million in grants to causes that otherwise would struggle to find the money they need to make a difference. Touchdown in that regard.

And there’s been incredible traffic online. So a huge participation win. A lot of people talking over an extended period of time.

But there’s one other thing I think they still need to do for this to really work: connect all the dots.

See, I get the ‘what’ and the ‘how’. I get that this was big. I get that this was a first. I get that this was an extraordinary way to divert marketing funds. I get that a whole lot of people in communities got involved (who wouldn’t?) and great good was done. I get that Pepsi went out on a limb. And I applaud for them for that.

What I don’t get is the ‘why?’. Not the immediate why – to promote great ideas and see them brought to fruition (which I actually think is closer to the what?). But the bigger question of “why Pepsi?”.

What is it in Pepsi’s purpose and its philosophy as a manufacturer of popular beverages that links them directly and meaningfully with the aims of this program? Where’s the philosophical ‘line of sight’ between this massive generosity and their worldview?

If it’s about “refreshing the world”, what do they think a refreshed world looks like? And how does “refreshment” tie in with their extended support of breast cancer, for example?

Are the many amazing ideas that have been suggested and supported about “refreshment”? And more importantly, are they about the understanding that most people have of the word refreshing? Is that word adequate? Or even appropriate?

Because if these ideas exceed what people think of as “refreshing”, then Pepsi has a golden opportunity here to completely own that redefinition – to make refreshing a world-changing idea or a community-changing idea, or whatever their aspiration for it is.

In other words, they need to establish, own and define the links between what they make, what they give, what they say, how they act and the vision they have for the planet?

Right now, I’m guessing those relationships. And I shouldn’t have to.

One thing I am clear about. “Refreshing the world” can’t just be a slogan. Pepsi have absolutely succeeded in achieving a refreshing approach but If it’s to work to its potential in this program, and the many other initiatives that Pepsi get involved with, it has to be a robust and exciting philosophy that is evident in every action and commitment that Pepsi makes. And it needs to be explained. Proudly. And clearly. People – both inside Pepsi and as consumers – need to understand the goal, the means, the challenges, the commitment and the reasons why Pepsi has signed up.

Most importantly, this program needs to lead beverage buyers to the stark commercial question: Yes? Or no? Do you agree with our view of what a refreshed world could mean, or not?

And the implicit call to action – if the answer is yes, then please buy our product. Don’t just like us. Don’t just notice us. Don’t just link to us. Decide. Decide to buy our products.

Purchase gives consent.

Let me re-iterate, I have nothing but admiration for what Pepsi have done, and the need to align actions with a clear and distinctive purpose is not just something Pepsi needs to tackle. I hope they go ahead and take advantage of the huge potential they’ve generated here.

Two questions for you in closing:

1.    What are you putting on the record about your company through your actions?

2.    What do the initiatives you support and endorse say about you that you’ve been saying all along?

These, to me, are the keys to translating a whole raft of  initiatives, be they social media, philanthropic or sponsorships, into viable business investments.

That’s a wrap

Format is really just a polite word for expectation. The way something is meant to be packaged.

Years ago, they told The Doors they’d have to recut “Light My Fire” to make it a single because it didn’t fit the format – too long. It was an OK single I guess, but it was nothing like the real thing. Change led to compromise. The original didn’t cram into a single for a reason. It would be like trying to make a 3 minute version of Bohemian Rhapsody. What are you going to leave out?

But the reverse is also true – works that may have one or two good ideas, repeated and padded to try and make them look and feel more substantial, to make them extend into the format.

Here’s the reasoning behind that action – if it’s a book, it must be 180 pages, so 180 pages it will be. Otherwise it’s not a book, it’s an extended essay or a long article or a something else. It must be that long in order to justify the price, to give people a sense of value. Just like films that are less than an hour long aren’t really films, they’re short films. Proposals that don’t reach 30 pages are an outline. And an address that is less than so many minutes cannot be a keynote …

The implication is always that those works that don’t fit the format shouldn’t be taken as seriously. Format is a badge of authenticity. Break the format and there’s a fear on the part of the structuralists that your audience might feel cheated.

What gets overlooked of course is that an idea in its best form is as long or as short as it needs to be to explain it properly. One page or a hundred, 5 minutes or 205, three bullet points or a full media slidedeck. That is where its real value lies. That’s what those who are reading, watching, listening or hearing are really paying for. That’s the insightful bit, the gift, the real thing of value.

I guess too that’s what iTunes and Amazon Singles and all the other format breakers are really asking: What’s the gift alone worth if the rest of the format – too much or too little of it – is just wrapping paper to you?

The real power of endorsements (and other opinions)

The purser on the plane this morning reminded us as we landed that the airline had just won two industry awards. She didn’t name them but the point was made. Endorsement brings that extra degree of confirmation that we as consumers have made a good choice. It plays to our collective wish to make wise purchases. It tells us we got it right.

The lack of specifics doesn’t matter. Schemas – the snapshot opinions that we form of people, places, things – are hugely powerful influencers. They help us navigate too many choices, too many questions, too much conflicting information, too little time. They motivate us to engage.

Without realising it, we form schemas for almost everything. Some are positive. Some are negative. Some are unjustified, either way. But the most common one is actually blank. It says “I don’t know what to think”. People literally don’t have a clue.

The reason is simple. You didn’t provide one. Your website looked the same as everyone else. The email you sent them was formulated and vanilla. Your business card has a swirl and an acronym and looks like everyone else’s. There were no endorsements or references, nothing to hold on.

You played it safe, you left it up to them. And there’s a price for that.

7 lessons from the Sevens

Mickey Mice, surgeons, musclemen, vampires, men in tutus … yes, it’s Rugby Sevens weekend in Wellington. And that means teams of people dressed thematically and wandering the streets of the CBD. Welcome to a brand of rugby where the games themselves are virtually the backdrop for the actions and celebrations going on in the crowd and beyond the stadium.

But there are also some important lessons for the marketers amongst us. Here are my seven out-takes from the madness:

1. Sometimes the event is strongest when it carries the name but isn’t actually the focus. In other words, it becomes the platform or prompt for a wider circle of participation. That wider circle may be where the money is.
2. As per yesterday’s post – if you change the format, you also challenge the expectations of what must take place. In the case of Sevens, the change of game format has evolved into a social prompt for an audience-wide costume-party.
3. If you give people genuine permission to behave differently, the initial hesitancy will give way to an atmosphere where people strive to outdo one another.
4. Interpretations will vary dramatically. Once they can see what’s in it for them, some will always push the permission harder than others.
5. If they are going to go out on a limb, most people would rather do it with someone else. There’s security, presence and confirmation in numbers.
6. People may watch what’s going on rather than participating directly. That doesn’t necessarily mean they disagree or disapprove. In fact, even their tacit approval can be highly constructive.
7. By Sunday it will be all over again for another year. As soon as you remove the event/atmosphere that fosters such behaviour, people quickly revert to type.

The power of opinions for brands

Dennis Ryan, the Chief Creative Officer at Element 79, believes that “Brands are opinions”. Dr Philip Kotler, world-renowned marketing expert, says “Brands help people make decisions.” Increasingly my own view is a mix of both these wonderful ideas:

Brands need to express, and be associated with opinions, that help people make decisions.

New words and altered meanings

Sue sent through a list of new words and altered meanings from a competition run by The Washington Post. These were my favourites:

Cashtration (n.): The act of buying a house, which renders the subject financially impotent for an indefinite period of time.

Ignoranus : A person who’s both stupid and an asshole.

Intaxicaton : Euphoria at getting a tax refund, which lasts until you realize it was your money to start with.

Giraffiti : Vandalism spray-painted very, very high

Sarchasm : The gulf between the author of sarcastic wit and the person who doesn’t get it.

Inoculatte : To take coffee intravenously when you are running late.

Decafalon (n.): The gruelling event of getting through the day consuming only things that are good for you.

Glibido : All talk and no action.

Coffee, n. The person upon whom one coughs.

Flabbergasted, adj. Appalled by discovering how much weight one has gained.

Abdicate, v. To give up all hope of ever having a flat stomach.

Negligent, adj. Absentmindedly answering the door when wearing only a nightgown.

Balderdash, n. A rapidly receding hairline.

Testicle, n. A humorous question on an exam.

Circumvent, n. An opening in the front of boxer shorts worn by Jewish men.

Huff or puff?

What to read into AOL’s acquisition of The Huffington Post for 32 times earnings? Another sign of a social media bubble? A bid for respectability by the corporate that, for many, has defined the unsuccessful merger?

Just as importantly, I’m struggling to get my head around the brand compatibility. Huffington Post – smart, sassy, informed. AOL – huge (though nowhere near as big as it was), dial up, looking to get back some high ground. Seems like Huff is looking for scale here, while AOL is looking for the quality they believe will drive advertising sales. I hope this doesn’t turn into a bun-fight between resources and returns. I’d also hate to see Huff Post’s integrity and feisty character compromised by the juggernaut.

And while Arianna Huffington herself may have done this partly because she’s worried that the Post is erring towards “the innovator’s dilemma” of sticking too closely to its strategy, I’m sure I don’t need to remind her that corporate history is littered with the wrecks of brands who tried to be too clever, forgot their core business or diversified/expanded their way into oblivion.

 

 

Groupon humour. Save us please.

So everyday discounters Groupon chose the most expensive ad day of the year to draw attention to themselves, and somehow came out the other side looking cheaper than their specials.

Is that funny? Does it even make sense? Could they be more glib?

Here’s their justification.

Sorry but this wasn’t clever advertising. Or smart, edgy or provocative advertising. To me, this was just outright dumb ego-drumming dressed up to be “dangerous”. I’d have fired agency Crispin Porter Bogusky just for presenting that work … (Shame. They were a great agency once.)

So why did Groupon do it? Fame, laughs, traffic …?

Attention is a very dangerous metric when it becomes an end in itself. In the bid to cut through the clutter of the most intense ad-space, the temptation is to throw out all the rules just to get the looks. But if you raise awareness and compromise or confuse the integrity of your brand, was that moment’s notice really worth it?

And if you just did it to get people talking about you, does that change the fact that you were prepared to trivialise the plight of a culture just to get attention? Was this just another Kenneth Cole?

From a reputation point of view, what does this spot say about Groupon’s sincerity as a brand? About as much as the CEO’s apology I would have thought.

If I was a Groupon investor, I would really, really have my doubts – not just about the way my money was being used, but about the judgment of those charged with using that money responsibly. Perhaps the next time Groupon came looking for backing I would do exactly what they suggest – save the money.

The value of market valuations

Now it’s Twitter’s turn to be valued like a phone number, and it seems I’m not the only one thinking this is just a little OTT. Google’s Eric Schmidt says there are clear signs of a bubble. Great. Then he adds: “But valuations are what they are. People believe that these companies will achieve huge sales in the future.”

Isn’t that the point of bubbles? They’re based on valuations, and hopes, which people say are beliefs, and for some reason we accord these valuations the status of quasi-science. They are of course nothing of the sort. They are today’s guess, this minute’s emotional response, a numeric whim – surely that was the point of the GFC.

Let me apply another quote from my friend Gren. Twitter worth $10 billion, with the potential to grow into a $100 billion company? “That’s dumber than a box of hammers.” Or maybe not. At least with a hammer you can nail something down.

 

Ten minutes of Gaga

If I was a Lady Gaga fan, how would I feel about her claim to have written her latest single in 10 minutes? Would I see that as a sign of her huge creativity? Or would I, on reflection, consider that the return for minutes invested, assuming this is another big hit, is going to make most Wall Street bonuses look relatively modest?

A cynic might say if it just took 10 minutes then she didn’t do a lot to make a lot.

It didn’t take 10 minutes of course. It took all the experience that Gaga brought up to that moment, and all the subsequent time it took, both hers and for everyone else involved – to get the ideas in the song expressed, captured, edited, packaged, marketed and distributed; time probably better expressed in at least months. So the key value metric here is misleading; it’s not actually time to create (the idea), it’s time to market (the final result). By drawing attention to the 10 minutes, Gaga has framed the product in the shortest terms, for reasons that she perhaps believes celebrate her artistry.

But audiences aren’t buying what she created in 10 minutes. They’re buying the end results of endless days by named and unnamed people to bring that idea alive. Critical distinction.

And in drawing attention to the 10 minutes she took, Gaga has, unwittingly or otherwise, devalued all of their time and contributions. I think they’ve been short-changed.

Gaga’s not alone of course in framing the value of what she does in this way. So many organisations want to explain what they offer in terms of the time it took, or didn’t take them – speed, somehow, being associated in the creative industries with genius or inspiration. But actually, for almost all of us, there is a massive difference between the creating minutes and the time we bring to a project through our past experience, and another chasm again, on the other side, between the formation of the concept and its cumulative delivery to market.

If you’re going to, or feel you have to, talk about time at all in conjunction with what you do, it’s that amount of time – the time it took to go from idea to shelf, and the time you had already invested before you had the idea in the first place – that you should be framing in your stories, because that amount of time feels careful and prudent and determined and produced.

10 minutes feels like what it is. A cup of tea.

The power of occasions

Habits are powerful, but occasions may be even more so. I think they engage us so effectively because they combine time and focus. And because of that, they provide permission – it’s OK to behave this way or that. It’s OK to do something you wouldn’t do on any ordinary day.

If you’re a smart brand, you’ll find a way to hook into that; to link what you’re about to what people are thinking about on specific occasions. You’ll give them a reason and a way to excel at the emotion of the moment.

On Valentine’s Day it seems appropriate to look at a brand that used the occasion of declaring love to forge one of the most powerful marketing campaigns of all time.

De Beers have turned a diamond into the embodiment of eternity with their sublime catch-phrase ‘A diamond is forever’. They’ve linked the optimism and romance of occasions like engagements and weddings with the promise to stay together ‘till death do us part’. They have encapsulated all that in a single symbol that is desirable, exceptional, immediately recognisable and intended to be presented on a specific occasion of peak emotion and worn from that moment on.

Then they charge the earth for it. Just to make it even more special.

Genius.

The real recipe for Coke’s success

So someone’s supposedly discovered the recipe for Coca Cola. What does that mean for the world’s most popular drink? Very little I would have thought. Because the world’s most closely guarded beverage trade secret has already done its job – it has helped build perhaps the most consistently powerful brand in the world. Beyond that, its value as a formula today is questionable.

Even if someone did replicate the taste, so what? They still wouldn’t be Coke. Great brands grow beyond the products they marque. They actually come to embody ideas – such as happiness in the case of Coca Cola – that the product reports to, and not the other way round.

The New Coke debacle might suggest otherwise to some, but to me that was much more about changing a product that consumers held dear rather than a taste issue. Consumers expressed their apprehension by citing taste, but taste, in my reading of this particular case, was the identifier to the wider fear. What they were really saying is – don’t touch.

So often brands think that their product recipe is the greatest thing they have to offer. They trademark their products or their designs and think the business and the brand is future-proofed. Not so. IP protection is important, don’t get me wrong, but it must form part of the wider, on-going telling of a compelling and relevant brand story.

In today’s environment, where no secret is safe (even the secrets of diplomats) and all products get to a point of being pretty much on par technically, I think you have to assume that a trade secret alone will not be enough. Coke recognised that a very long time ago and used its “secret” recipe to build its brand. Same with the KFC Colonel’s 11 herbs and spices. A food scientist could probably break those down in an instant. Fine, it’s done its job.

However, there is another side to this. Talking with Alex today, she made the very good point that releasing the recipe does demystify the Coke brand just a little, and, more to the point, if there was anything in the recipe that consumers hadn’t known about then that could indeed have jeopardised Coke’s brand equity.

That doesn’t seem to have been an issue in this case – beyond the widely known inclusion of coca – but, as Alex so wickedly asked, what if it had? Wow.

What’s your reply?

“I can’t believe they got that job. We are so much better than them”. We’ve all heard that. Some of us have said it. Here’s the question. Then, why did they get it?

If it was price, what did they do to their cost structures to make their price possible?

If it was networks, what are they doing or who do they know that you don’t?

If it was credibility, what makes them a more comfortable choice than you?

So many companies respond to a competitor’s wins with excuses. The companies I like are the ones that use every loss as an opportunity to re-evaluate if and how they themselves need to change.

Sometimes, decisions are a bit like email. It’s not the message you get that counts. It’s the way you choose to reply.

Four hard yards

Sitting in the lounge waiting to board yet another plane, it’s fascinating how many people are busy. Laptops open everywhere, conversations on smartphones everywhere (at various levels of discretion). No-one wants to miss a minute. And yet today Borders tanked, and local book chain Whitcoulls announced it’s in schtum …

I wonder how many of their senior people are at work right now still believing that hard work alone will get them through …

Albert Einstein once defined insanity as doing the same thing over and over again and expecting things to change. Somehow, we’ve allowed ourselves to be lulled into the false security of doing. Things will just be fine if we work hard, advertise hard, sell hard. But while all this is happening – while everyone is working hard out – it’s easy to forget the real things that actually put distance between you and circumstances.

1. Look hard – at what’s really happening and ask the hard questions about what that might mean

2. Brand hard – so that you continue to mean something exciting rather than just selling things

3. Finance hard – so that you have debt structures that are at least viable

4. React hard – read what’s happening and make the difficult decisions

I call them the four hard yards, because if they were easy everyone would be doing them.

Out-thinking the recession

When everyone’s in sale, no-one is. It simply means the market has reset the prices that consumers expect to pay. So I was interested in this interview with retail specialist Jim Lucas of Draft FCB about how businesses should approach recessive times. Here are my key out-takes from his interview:

The lack of decline in small luxuries such as skincare and animal treats is a clear sign that shoppers will hold on to a handful of indulgences in their everyday lives just to feel normal. The secret is to scan for those opportunities in their changing behaviours.

Rather than focus on the big ticket buys, look for little pleasures. Lucas says marketing is about trying to change behaviour, and a recession is a strong backdrop for that. “’You need to think of creating behaviours or new forms of regimen or rituals or routines that are going to fit into this new era.” That means, for example, calling for smaller actions: paint a wall, rather than repaint the house.

Continued discounting will simply make some categories unprofitable, and not just that, it will cement in those price expectations. Goes to my point earlier.

Finally, Lucas says, the rise of private labels is a sure sign of brands failing to communicate their points of difference. If that’s happening in your sector, it’s a sign that consumers either don’t value quality or regard it as ubiquitous. Changing that requires shifting what they value rather than just the value itself.

Incidentally – one of my rules from when I worked in direct marketing was that it was always better to give than to lose. I always used to try and keep prices up by giving consumers more product(s) for the same amount rather than the same product for less cost. Oh, and make that “extra something” a little treat if you can – for the reasons Lucas outlined above.

 

Rediscovering trust

While the officials, scientists and insurers in Christchurch start the interminable discussions over what, when, where, why, how much and who, perhaps the toughest task of all for the authorities doesn’t lie in rebuilding the structures, but rather in bringing back the very human aspect of trust.

With time, patience and enough goodwill and funding, government, insurers, investors and the private sector can restore order, power, water, services, homes, the CBD, everything that has been physically lost and damaged. But what the hell is it going to take for faith to return?

Lessons from Wikileaks

What’s Wikileaks really selling us? Access to information we deserve to see or the chance to participate in something that piques our curiosity? How many people have actually read the Wikileaks files – and at the end of the day, does it actually matter? Is Wikileaks important for what it says, what we’re told it says or what it claims to represent?

Julian Assange has done a masterful job of linking his ‘product’ to some powerful and highly emotive causes: freedom of speech; censorship; government secrets, and of course persecution of the individual by the state. Big causes; global causes; causes that attract a committed audience; causes that broaden and deepen the Wikileaks’ brand story.

In the process, of course, the brand has deftly snookered the authorities. If governments don’t express outrage at what Wikileaks has done, then they may encourage other persons with access to such files to release more leaks. If they do condemn the brand’s actions, that merely strengthens Wikileaks’ brand story as the modern day Robin Hood of free speech.

In a world of open information, “right to know” brands are the harbingers of today’s dirty little secrets … And Wikileaks is a master of the modern-day peep show. Snippets of what goes on behind the scenes at an international level … and all the press coverage a brand could ever want. A little bit here … and a little bit there. Buy a T-shirt or a mug, and in between court battles, Wikileaks will tell and show you a little more.

What does all this mean for you? It’s further proof that privacy the way we’ve always had it is a has-been. Your brand is probably findable, searchable, leakable. That makes the brands that find, search and leak potentially very powerful indeed. Same for the brands that stop the finding, searching and leaking.

Secrecy is the new pornography.

Stars and scandals

I’m not a huge one for the ins and outs, behaviours and otherwise of the fashion world (preferring to leave such pursuits in the experienced hands of friends like Jack), but I did take some note of the recent John Galliano scandal because it highlights the risk that brands take when they associate themselves so closely with an individual who is a brand in their own right.

It’s not always bad of course. Steve Jobs turned up for the iPad2 launch, and everyone took heart. The stock price even went up. And in fashion, most would agree I think that designers like Marc Jacobs and Karl Lagerfield have done wonders for the brands they are associated with. Galliano too up until this point. But how quickly, and dramatically, things can change.

Almost every brand today it seems is just one YouTube clip away from a crisis.

And when things go wrong in this kind of situation, there is fallout on three levels: the individual’s brand suffers; the employer’s brand suffers; and the halo effect that I would call the relationship brand also suffers. It’s still early days, but that’s what has certainly happened here. Galliano is in disgrace. Dior is on the defensive. And inevitably a whole range of things are being called into question.

The wider message here for brands, of all types and sectors, is that if you have public-facing “stars”, they can be significant assets, but their potential to compromise your brand, particularly in these days of the three second clip, extends into areas well outside your own sphere of influence.

In this case, we’re talking about someone whose employed. But the same situation, from a branding point of view, exists for sponsorships, endorsements, third party agents, contractors … anywhere there’s a link back to your brand that you are promoting in order to cement perception. It could be a person, it could be a show, it could be a team, it could be your rainmaker or your top performing salesperson.

The scary thing about investing in a “name” is that you are investing not just in what they do at work for you but what they do, or don’t do, outside of work hours. Reputation never sleeps – which can make the face of any brand, yours or not, appointed or otherwise, a 24 hour goldmine or a round-the-clock nightmare.

 

Cult branding: Developing a scarcity strategy

In a world dominated it seems by the push for scale and mass coverage, it’s easy to forget that sometimes the smartest thing you can do is the polar opposite: develop a deliberately limited edition brand that shuns the mainstream. I’ve written about this a number of times – here’s an example – and coined the phrase cultrepreneurs to describe those enterprising individuals who have chosen to create and market brands with cult status.

As this story about Julian Van Winkle and his Old Rip Van Winkle Distillery shows, there is nothing accidental about why his aged bourbon attracts a fervent following. I really liked the owner’s description of ‘a strategy of scarcity’.

Here are just some of the ways Van Winkle builds cult status:

• The company deliberately stymies supply in order to raise cachet and lift returns. It’s one of the great ironies of cults that, beyond what you need to be viable, sometimes the less you produce, the more you make. As Van Winkle says he could unload two or three times what he makes. But keeping his inventory low minimises the chances of being stuck with spare stock and also means he can continue to raise prices.
• The brand is not visible. You have to be in the know, and prepared to wait, in order to procure the product. So – scarcity of presence only adds to the mystique, and lack of readiness lifts the anticipation levels. Entirely the opposite dynamics of mainstream, scaled brands.
• The brand gets covered by others. The article is a prime example of that. But Van Winkle also makes great use of word of mouth, through dinners and trade shows, to get connoisseurs talking and so raise authenticity, desirability and credibility.
• The brand has deeply embedded values – in Van Winkle’s case, an unstinting focus on quality. And there’s a figurehead who embodies those values – Julian’s grandfather, Pappy Van Winkle – and who is known by consumers of the brand.
• There’s a secret recipe – this one substitutes wheat for rye. Another component of making the brand exceptional.
• Awards prove the value of the brand and its claims to quality – and once again, they do this objectively, rather than the brand itself having to make public claims.
• Distribution is limited, and upmarket. A very big part of the joy of a cult brand lies in its discovery. Finding out about what most people don’t know about is a reward in itself. It also, ironically, invites the very kind of ‘sharing’ that galvinises the brand.

Perhaps the most powerful thing about the decision to build the Old Rip Van Winkle Distillery into a cult brand is that scarcity absolutely fits with the specialness of the product. Everything about the brand is genuine. There is no ostentation. Van Winkle aged bourbons are rare because of what they are, not because they have chosen to self-consciously position themselves that way. There are any number of ‘upmarket’ brands that look to borrow from cult brand ideas – but many come with an inherent sense of self importance, which they call prestige, that compromises their desirability. As the CNN article points out, so much of the bourbon base product evaporates before it is mature. So scarcity is a precept built into the very nature of making aged bourbon. What Van Winkle has done is to accentuate that quality and celebrate it, rather than trying to compensate for it. That would have been difficult, perhaps impossible, if the product or its manufacturing was inherently more mainstream.

The temptation to be overt is all around us. Social media in particular has raised visibility to god-like status. But in the world of cult brands, even difficulty in finding the product is not necessarily an obstacle – in fact it can be very engaging, very sticky. By making what was already a rare product into something even harder to procure, Van Winkle has astutely and discreetly lifted desirability.

 

 

 

 

 

 

 

The strategy consulting dilemma

I remember having an animated discussion with the CEO of a professional services firm once about their right to take a market-leading position in problem solving. His resistance was based on the fact that, statistically, such work constituted a relatively small part of what they did, even though it was the work that the whole firm loved, and that they had built their reputation on.

How can we claim for that work to exemplify what we do when it is a smaller proportion of our fees?, he asked me. Unless you want that trend to accelerate, how can you not make a stand in the market as the strategist of choice?, I replied.

What do you want to be known for vs what you actually do the most.

Or as Rolling Stone put it so brilliantly: Perception vs reality.

This review of the state of strategy consulting suggests the dilemma was not his firm’s alone. Strategy is still the poster-activity for the smart set, but more and more firms are finding that strategy, while still the activité du jour of a thought leader, increasingly represents less and less of the money in the door. Strategy may be what they’re known for, but the real money it seems gets made much more prosaically. Consider this: “behemoths such as McKinsey and BCG, to maintain their above-industry-average growth rates and keep their global office networks humming, have broadened what they do and moved down the food chain.” In fact, according to the article, pure strategy is on the way to becoming the loss leader that firms ‘invest’ in, in order to win the bankrolling work.

You can read this a couple of ways. If you’re an optimist, it’s a sign of the convergence of thinking and execution into a seamless whole. If you’re a cynic, you’ll see it as one more step towards action at the expense of direction. Either way, if strategy is to avoid commoditising, it’s going to have to reassert its value or risk steady deterioration.

Does strategy consulting itself need a new strategy?

Reaching the social consumer

New media guru Brian Solis has filed this excellent article on what some are predicting to be branding’s next key customer: the social consumer. Based on research from attendees at The Pivot Conference, there are a number of key out-takes:

Social media has a strong in-house bias and is the biggest responsibility for marketing/advertising teams. But while marketing dominates social media responsibility right now, Solis’ view is that “social media will extend the capacity of any business unit or division affected by outside behavio[u]r.” So expect to see social media making its presence felt in PR, sales, customer service, even investor relations …

If Solis is right – and there’s no reason to doubt him – that means companies will need to hard-wire social media into their lead and sales generation processes and into their customer and stakeholder response systems. My view is that some functions will find this easier than others. The significant benefits of course are timeliness and efficiency. But based on research I’ve seen in the investor relations’ space for example, this could take a while. I do agree though that it’s inevitable.

The Pivot Conference research also found that while marketers plan to significantly increase their use of social media, with the majority of participants identifying it as a component of an effective customer relations programme, only 35% of those polled actually saw social media as fundamentally different from other media. I was also interested in the fact that while 73 percent said their social media programmes were successful, only 16% identified them as very successful. A whopping 57% identified them as somewhat successful.

Three key out-takes for me here.

Firstly, it looks like the majority of marketers probably aren’t using social media that differently from the way they use other forms of marketing yet. In other words, they recognise it as a channel, but either can’t, or don’t, regard it as a discipline in its own right. This may change of course as social media becomes more integrated into outward-facing corporate functions and more and more parts of the enterprise start to recognise ways to use it to improve their work.

Secondly, the size and vagueness of the response around returns suggests people are still relatively hazy on what they get out of their social media investment, and that a sizeable number are still trying to reconcile buzz and bucks. For now, most it seems will continue to throw money at it. At first glance, the problem is not dissimilar to the ways corporates first used the internet. As organisations have discovered wider and wider uses for online, and the technology has expanded to accommodate those, the understanding of the value of the internet has also broadened, and what was once the preserve of the IT department has become a way of working that permeates more and more of the business model. In other words, I think the monetisation model for social media – the return factor – is more strictly defined right now than it will be in the years ahead.

Finally, while the majority of those polled seem to have defined the social consumer as someone who is reached and engaged by social media, my own view is that such a definition is too restrictive. To me, the “social” aspect has the potential to be much broader, incorporating a number of other key trends including corporate social responsibility. An opportunity for example, at least in the medium term, lies in how companies and brands link consumers with what they are doing via their CSR in  order to generate product preference, and how they might use social media to do that. Let’s talk more about that another time.

 

 

 

 

 

 

 

Tea and Coke

An interesting piece on how organic beverage company Honest Tea might fare as part of the Coke empire. As is observed here, so often these brand acquisitions are a disaster. The very essence of the brands that saw them lapped up in the first place is squeezed out by multi-nationals in their hunt for a return on their investment. Unable to act as quickly as they had when they were growing on their own, and often without the inspiration and commitment of their entrepreneurial founders, the brands quickly wither.

Doesn’t seem to have happened in this case. At least not yet. Powered by the massive production and marketing muscle of Coke, Honest Tea’s sales have skyrocketed. But their key challenge going forward will be to keep customers convinced that Honest Tea has not been compromised ethically; that everything the brand stands for, and believes in, the promise inherent in its name, still holds and that their new master will continue to allow them to hold and espouse their own views.

Opportunities and challenges for Coke too: the chance to continue to diversify out of the embattled high-sugar soda market into the healthier product lines that young and affluent consumers seem to be gravitated towards, whilst resisting the almost instinctual urge to simply throw a scale approach at this niched product and hope it will stick. The formula that works for sweet drinks needs more than a little tinker to migrate to tea.

Allowing individuality and authenticity to flourish is counter-intuitive to the command-and-control style of many motherships. But if brand diversification is to work it needs to be just that: the opportunity for a brand portfolio owner to embrace and encourage a range of approaches and philosophies – each specifically suited to the personality and customers of the brand. Ultimately that is what continues to cultivate loyalty and engagement. That’s what helps the brand feel that it still has a life and a value of its own. Anything less delicate, and the acquired brands can be quickly smothered in a formula that leeches the honesty from them.

The sign of a successful buy-up is that it doesn’t feel like a sell-out … for either party.

Follow the money

So what are the chances that Charlie Sheen’s much publicised “breakdown” is a reality-style seeding exercise? Depends how cynical you are I guess. But it is an interesting coincidence isn’t it that within just a few days the man has created a larger-than-life controversy, attracted two million people to his Twitter account and now signed to the latest version of the celebrity endorsement.

That seems very organised.

Serendipity? You decide.

One of the key principles of direct marketing is to always work back from the result. And I think it was David Ogilvy’s mantra to say as much as you need to say in order to make the sale. Well, if the “sale” is Charlie Sheen as a wild-child pitchman on Twitter, mission accomplished. He’s said more than enough. And lawsuits and media statements guarantee there’s plenty more to come. And if the intended result was also a new sense of profile and validation for social media monetisation models, again mission accomplished.

As this article points out:

All the attention has brought a huge amount of exposure to the business of social media advertising. Though companies have been working advertisements into Twitter and Facebook for more than two years, it’s a sometimes unnoticed practice. “A lot of people know about the business now,” says Ad.ly CEO Arnie Gullov-Singh. “It’s a validation of the business that we’re building and the overall industry changes that we’re a part of.”

I find this emerging model an interesting one, not least because it seems to bring together sectors that have tended to remain unconverged. It appears to combine the proven money-making power of the gossip industry with the reach and immediacy of Twitter and the corporate funding of advertisers keen to reach specific demographics. That’s a pretty powerful circle if you think about it.

So what role has Charlie Sheen really played in reinforcing the next iteration of the corporate pitch? Is this model to Twitter and Facebook what Adwords was to Google? Will it further inflate social media company valuations? Too early to tell of course. You and I both know we’ll just have to follow the story.

Pleased to meet you

 

This really thoughtful post by Associate Professor Rob Cross of the University of Virginia on building valuable networks caught my eye today. Specifically, I was drawn to the final para:

If we are circulating too much with people we have known forever or people who themselves are all spending time in the same meetings and interactions, then we are not getting the performance impact … The magic lies in the new ideas and perspectives that can come from connections into different networks.

The same point applies in many ways to the networks that brands build with their customers. If they are just selling the same goods, or even new goods, to the same community, then there is no contagion – no reason for the brand to spread interest and influence beyond those who already know it.

A circle can quickly become a wall.

The opportunity for brands is to introduce new ideas into their networks and marketing that ‘stretch’ those who know the brand well, but also serve to introduce and absorb new followers beyond the brand’s established catchments. In other words, brands should be looking to continually expand their outreach, whilst remaining true to a core and unmoving purpose. The last point of familiarity should be the launch point for new ventures and approaches. And just as importantly, brands should make sure they follow the relationship and affinity trails, not just the structure trails.

In other words, expanding brands should be looking to franchise the emotional connections. People might buy more than coffee from you for example, if the emotion that enticed them to buy coffee from you in the first place translates clearly and simply into other areas. That way the brand maintains integrity, intensity and renewal. There should be, in Rob Cross’s words, “connections into different networks”.

Time to stop asking “What will this make us?” and to ask instead:
• What could we introduce?
• Who would welcome that?
• Why would they come with us?
• Where could this take us? and
• Who could we meet then?”

Keeping things spicy

This article about the hugely successful Old Spice campaign makes the point that Proctor & Gamble wasted a lot of opportunity when they allowed a database of more than 100,000 individuals to dissipate.

The author says Old Spice spent millions on a highly integrated and sophisticated programme, and then let it lapse. They have, to paraphrase the article, not gone the distance, and as a result, he says, it will cost Old Spice a lot more to re-engage those people than it would if it had stayed in touch with them.

Basically, we’re talking about follow-up here. DM101.

Here’s the thing though. Successful direct marketing is all about going from 0 to many and then getting all the way back to 1, and staying there … profitably.
• 0 to many gets you the mass attention to provoke a response and requires mass media and mass money.
• Many to 1 requires sweat, data, detail and the ability to close. It needs databases, interaction, lots of number crunching and delivery.
• Staying at 1 requires insight and flair, attention, entrepreneurship, interest and persistence. It’s about keeping individuals involved, interested and buying. And most of all, it requires listening and responding.

All that work to sell a stick of deodorant? You’d like to think that a savvy marketer like Proctor and Gamble did the numbers. Perhaps, given how often people buy deodorant, it just wasn’t worth it to sweat the asset. Perhaps the ‘bump’ was enough to push numbers back up to a sustainable level, at least for now. Perhaps everyone just needed a break.

When you furnish people with your full attention, when you amuse them, make them laugh, talk to them, even flirt with them, you can bet that when that tap gets turned off, some people will disengage immediately, some will miss you, some will want things to continue as they were. Almost everyone will in some way be disappointed.

Just because of the huge shift in intensity.

You can get people’s attention. You can hold people’s attention at least for a while. But can you sustain people’s attention profitably? That’s one question. And what do you do if you can’t? That’s the other.

What triggers a surge of popularity?

What prompts 2.5 million people to follow Charlie Sheen? It can’t be because they expect individual recognition in return.

Why do thousands of people stand outside an Apple store waiting to be one of the first to buy the next iPad? It’s not like even one of them is going to get it free. There is quite literally nothing in it for them beyond being able to say that they were there, near or at the start.

So what’s the motive? I think it’s the thought that this looks too exciting to just be a spectator. They want to share this first-hand. That’s what distinguishes participants from spectators. Proximity. How close they are prepared to get to your brand because of how they feel about it.

The dangers of categorical denial

Some things are too big to fight. If you’re planning to redefine a whole category for example, then, unless you’re already a market leader, plan on a big outlay and a long runway. You’re literally battling the millions others have already invested to define what it is, what it means, who it’s for, where it’s found, who the key brands are, what the products generally cost and so much more.

If your competitive advantage is predicated on breaking one of those fundamentals, be very aware of the fight you’re buying:

• You’re battling the pigeonhole that your supply chain will want to put you in;
• You’re fighting the expectation that your customers automatically have of you;
• You’re asking for the competition to diss you as unimportant or uninformed; and
• If you somehow beat all that, and manage to get established, you just pressed the GO button for a whole bunch of imitators to copy your IP and innovation

Here’s the irony. If you’re going to enter/change a category, you must provide the market with enough for them to recognise, but at the same time, you must clearly differentiate your product.

The innovation question is not what are you looking to be, what are you going to invent or even what are you looking to change? It’s – what will your prospects recognise as needing to change, will they welcome that change fast enough and in sufficient quantities, and how much change will you need to generate internally (in terms of systems, skills, offerings and mindsets) to make that happen?

Noting Moleskine

In theory, a company like Moleskine should be redundant. Who needs a little black sketchbook these days? Who needs pencils and the ability to sketch and note down ideas? And yet many people – and I’m the first to confess, I’m one of them – are ardent fans. Why?

It’s because Moleskine have sold us a fantastic story: a story of romance and creativity, of spontaneity and genius, of travels made and ideas explored that actually relies on its heritage to work. Woven into their brand are associations with artistic and literary giants. In fact, this little black notebook, with its polite strap, has built up a backstory that embodies great thoughts captured on the move, and celebrates freedom, inspiration and potential …

It’s a backstory of sharpened pencils, crisp paper, and lateral thinking, washed down with (at least) strong coffee, that absolutely targets those who love creativity.

Sometimes, just sometimes, the most powerful thing you can do in your brand storytelling is to revive what people yearn for, or fear may become lost.

The response dilemma

A very different post today – not about brand as such or business necessarily, but rather how we should prioritise after a disaster. When is it time for life to get back to normal?

Tomorrow – Friday – Christchurch will hold a memorial service for those killed in the recent earthquake. Yesterday, the reaction to news that Rugby World Cup games would not be hosted in the city in September provoked very different reactions. Some thought a few cancelled rugby games were the least of anyone’s concerns. Others said they had been banking on the games to help lift their spirits and this was another kick in the teeth for a city that was already feeling it had copped more than its fair share of sadness.

It got me thinking about global reaction to the Japanese situation. There’s been a lot of focus naturally on the nuclear situation, which is still far from resolved of course. There has been a great deal of focus too on what these calamitous events will mean for the country’s economy and for others’ exports. There’s been lots of pictures of the swathes of destruction.

While the scale of the two situations is completely different, the question is the same. When is the appropriate time to stop focusing on the human disaster?

It feels like tragedies have barely even completed these days, and the news is filled with economic impacts and the insurers reminding us all that this is costing a fortune and therefore policies will be going up.

I don’t have an answer for what time is appropriate. I can tell you that my instinctive belief however is that there should be a pause, a time when economics, markets and business are put to one side, while those who can be rescued are, and so that the focus can remain on hope for the living and respect for those who have been killed or badly hurt. It doesn’t seem to happen. The global economy seems to lack a pause button.

But what’s respectful and what’s practical? When is the proper time to start thinking about the wider effects of what has occurred?

The other day I read about a company that was having a really hard time after the Christchurch quake. I emailed the CEO to say look, there’s a very good chance your company and your brand are going to come under a lot of stress in the weeks ahead, is there anything my company, with our experience in dealing with brands that are in trouble, can do to help stabilise the situation for you?

I explained that I myself was from Christchurch originally, that we had people there and that I really felt for their loss. Perhaps we could help them secure income and protect jobs at a time when people already had enough on their minds?

So far, I haven’t had a response.

Reading between the lines

One of my favourite reminders to every brand is – be very clear about what it is you are selling. So often, companies have a view of what they’re offering that differs from what their customers are actually buying. News that The New York Times has confirmed its pricing strategy has me wondering if they have fallen into the same quandary.

The temptation when you produce a newspaper must be to believe that customers are buying news. The Times certainly seems to think so. According to the article, the new pricing strategy means readers get up to 20 articles per month free, and after that they will be prompted to purchase a subscription. That limit is designed to “draw in subscription revenue from the most loyal readers while not driving away the casual visitors who make up the vast majority of the site’s traffic.” If you get to the newspaper via social media the 20-article rule does not apply, but there is a five article a day limit for those who access the site via Google.

(That in itself is interesting because I don’t know about you but I source all my news through aggregators.)

The model infers that the Times believes those who get their news from them will buy their news from them. And whilst I agree totally with the Times’ Chairman, Arthur Sulzberger, that there is “valued content”. I’m not convinced that news per se – the data I can source freely and without cost from so many places – is actually “valued”. The inevitable question of course is: valued by whom – and why? The newspaper or the readers?

If you look at the online subscription models that have worked, such as the WSJ, what readers seem to be actually buying is authority. It’s less about the news per se and more about the analysis of situations, issues, developments etc by bright minds in a specialist environment. The information itself has become a given. It’s the thoughtful analysis of that information by a source they respect that people crave.

Next question. How far would that extend? I might pay for an analysis of an emerging market. But would I pay for the latest gossip on Lady Gaga when much if not all that information is freely circulated on Twitter, through fan sites and in social media?

What’s in the box?

Marc Levinson’s book The Box explains why a “soulless aluminium or steel box held together with welds and rivets, with a wooden floor and two enormous doors at one end” was able to revolutionise trade.

As Levinson points out the container is about much more than what it does, it’s about what it now represents to all of us living and buying in the global economy: an extraordinary system for moving goods between places at minimal cost and with as little complication as possible.

Along the way, the humble container literally changed the world around it: new ports became valuable; just-in-time became possible; international trade accelerated; loading and delivery times shrank; trade became standardised; supply chains extended.

But the economic benefits that arose from the container didn’t come from the box itself, clever as it was. The real innovation came from entrepreneurs who, over time, discovered how they could apply the potential of the container to their commercial advantage. It was those people who saw that this box with “all the romance of a tin can” represented much more than just a change in shipping. It was literally the shape of trade to come.

As that happened, Levinson points out, the real shift occurred. Businesses that at first had struggled to see how the container would work for them came over time to reshape themselves to ensure they could make better and better use of the equipment that was redefining whole industries.

The container serves as a powerful parable for all of us developing brand strategies and stories. The temptation is to go so far as to ask: What does it do, or even What could it do?

But finding the real potential, the wonderful story, the innovation that the rest of the world may have missed in a product or idea requires us to go three questions further.

What could it be? Where might that lead? And who would that excite?

 

Checking the All Blacks line-up

Brand extension is always one of those issues that people grapple with. On the one hand, there’s a wish to capitalise on the goodwill that has been patiently built up, sometimes over an extended period of time. On the other, there’s always the concern that the brand is going to run out of road, and end up attached to products that don’t reflect the true spirit of the marque.

The clear concern being voiced by some in rugby circles is that one extension of the All Blacks brand, merchandise, has crossed that line; that a range of products that includes baby bibs, Easter eggs, watches and lunchboxes risks, in the words of Michael Jones, “watering down … the heritage embodied in [the brand]”.

That raises the issue of what the All Blacks brand stands for. What is the core idea that everything to do with the brand reports to?

If the brand is about growing up in New Zealand to become a rugby legend – if that’s their core idea – then the current range is fine.

If, on the other hand, the All Blacks are the epitome of sporting excellence and if they carry the legend of the game in New Zealand and the thrill of victory over determined competitors, then Easter eggs and baby bibs could not be more out of place.

To me, the issues for extending the All Blacks brand do not revolve around quality, price, accessibility or fundraising. Those are all considerations, but they cannot be the main drivers from a brand point of view. Primarily the decision on what to include or not must revolve around ‘fit’ – products that receive All Blacks branding must at least reference, and preferably enhance, the All Blacks story. The managers of the All Blacks brand need to be staunch about that because as Jill Brinsdon so rightly points out, everything the union does either builds or undermines the All Blacks brand.

The NZRFU did a sterling job in my view of taking the All Blacks brand commercial. But this is not one of those matters that can just be set in motion and left. Otherwise the Union risks treating their All Blacks brand as little more than an expensive stamp for hire.

Remember the adage: just because you can doesn’t mean you should.

 

What’s a brand problem?

I’m always fascinated when people tell me they have a brand problem – because I’ve seldom encountered one. I’ve encountered a whole range of business problems however that addressing the brand can fix.

One of the real concerns I have with many “brand strategies” is that they work in too small a circle. The vicinity of their reasoning is marcomms, which is important of course and immediate, but what gets lost with such a restricted approach is the wider thinking needed to really address and resolve the matter at hand.

And unless you take that broader approach, unless you actively build the widest context into your consideration set by really understanding what’s happening to and within the business, you’re just dealing with what’s in front of your nose. There’s also a very real risk that the brand strategy is actually little more than an elaborate but ultimately isolated justification for the communications approach.

Light my fire

What do you do if you’re one of the world’s most famous lighter companies and the number of smokers is dropping?  If you’re Zippo, you look for ways to capitalise on your ‘cool’ image and extend your brand into products ranging from watches to leisure clothing.

Zippo hit its zenith around the mid-1990s with 18 million lighters a year. Today, that figure’s dropped to around 12 million lighters a year and the hunt is on for products that are, in the words of president and chief executive Gregory Booth, “rugged, durable, made in America, iconic”.

It seems to be a standard operating procedure these days. Brands hit a certain scale and then look to diversify in order to fish in other waters, or else, their iconic products hit their use-by date and they start looking for ways to sweat their assets, or someone brings a brand back from the dead and looks to add product lines to what they hope is its revitalised equity.

Sadly, many of these diversifications don’t strike me as strategic. They are reactions or speculations – planned perhaps, but reactive or speculative nevertheless. And like all sequels to the original story, some will work but many will simply not live up to the original.

Simply attaching a brand to a catalogue of goods does not guarantee success. Diversification has to make the brand stronger, more relevant, more accessible – not just look to draw on the existing equity in order to cast a wider net.

The good news for Zippo is that they seem to have spotted the problem well ahead of time and planned carefully for the transition. They will just need to make sure that whatever they do has line of sight with their on-going story, rather than on depending on recognition alone.

If you’re tempted to go down this route yourselves for any of the reasons mentioned above, here’s my questions:

• If you introduce this new line as part of your brand, what are you asking the consumer to believe?
• Is that a reasonable belief? Will it make sense for them? Does it extend what they already believe about you?
• Will it intensify the loyalty that your customers have for the brand?
• Why are they going to believe your new story over the story they’re already hearing from another brand for whom that product line is core business?

 

 

What are you worth?

Some fascinating insights in this piece on how consumers are valued collectively and individually by organisations. I was amused to see how, in B2B trades, consumers were valued at much, much more than they were when organisations contacted consumers directly.

Some time back I had an issue with what each Facebook customer was worth (still do). But in comparison to some of the deals mentioned, they’re being very modest. Compare for example the $1147 that AT&T is proposing to spend on each T-Mobile customer or the $4,700 that Cablevision Systems Corp. will pay for each Bresnan Communications customer with the much smaller amounts that cable, utility and credit card companies pay individuals to switch.

One example quoted has Energy Plus offering JetBlue frequent flyers 3,000 points, worth around $45, for choosing it as their electric supplier.

It tells me that what the market values customers at as a group and how the companies themselves value customers as individuals appear to be at significant odds. It’s almost as if as soon as they can put a face or even a name to the relationship, the relationship loses value. A lot of value.

Is this the financial equivalent of a problem with intimacy do you think?

Making the second sale

People say the first sale is the hardest to make. You have to find the right person in the right company, you have to catch them at the right time in the right mood, make your pitch, you have to convince them to go with you. That’s got to be the hardest thing in the world doesn’t it?

I’m not so sure. Because, at least with the first sale, there’s the curiosity factor. There’s the opportunity to try you out, maybe on something small, maybe on something others are struggling with or that issue they have not got round to. First sale takes determination and courage and the willingness to push through against many, many obstacles.

But I think the second sale is more difficult. OK, it’s easier in that they’ve seen what you did. You have some small degree of familiarity on your side. The risk of course is also that they’ve seen what you did. They feel they know you. They’re forming their own impressions about your abilities.

The real disadvantage though is that by second sale, people want to know why sustained interest in you is warranted. Not only that, they also need to convince themselves that choosing you again is better than choosing anyone else they already know (including all their previous first timers), the hot “new thing” they haven’t yet tried or the many first-timers who are now banging down the door asking for their chance.

If you’re a new brand, and you’ve overcome all the obstacles to get a product to market, to get noticed, to get distributed and you’re filling targets, congratulations. Enjoy the moment.

Soon, very soon, you’ll need to turn your attention to the make-or-break question:

Now what have you got?

Loyalty and lust

Over tea with Alex in the sun a couple of afternoons ago, we got talking about what you can count on in a market, and what you can observe but not necessarily depend on. I’ll leave it to Alex to share the specifics of what she talked about in her own inimitable way, but our conversation did get me thinking about the different kinds of customers that brands have today because in the face for scale, it’s easy to confuse the different levels of interest and loyalty.

Let’s start with what happens when you get waves of visitors. It’s tempting to have your head turned by the massive numbers that can swarm a post, a thought, an idea, a product. Suddenly your metrics are through the roof and your mentions are running like ticker-tape. You are the talk of the world, and the temptation of course is to think you’ve made it. You have their front of mind. But that space is mercurial, and attention – one the Holy Grail of marketers – is now a false prize. That’s because such amazing scale-up comes with an equally astonishing fade, as something literally crosses the collective spheres and then disappears. You may get the attention but that’s no guarantee you’ll hold it. Once the swarm moves on, chances are you’re flocksam; one more thing they leave behind.

However, at the very same time as you are being swamped by a popularity wave, chances are you are also growing a loyalty current.

The two groups have very, very different drivers. But they grow, at different rates, simultaneously. Two distinct behavioural bell curves.

While those in the wave are momentarily inclined to fashion and trends, those in the loyalty current are looking for stability, consistency and reliability. They want to go on a journey with you – and they’ll stay as long as it’s exciting, rewarding, involving. They may well be a smaller group, possibly a quieter group, but they are vital because, critically, they fill the gaps between the waves you generate. They are your residual brand base. They are the ones who will talk about you in a sustained way, buy into your story, give you feedback, will you to succeed. They are the ones who are buying your products between the headlines. Currents generate cashflow.

But that comes with conditions – and one of those conditions is that, as their loyalty increases, they will take more and more interest in what the brand is and what it stands for. They will hold you to account for where they believe your brands needs to go and what they expect to see and experience. And they will want that journey to be what my friend Christine calls “consistently surprising”. Upset them, and the impact will be more than sensational, it will be financial.

Increasingly brands are going to need to be able to sift waves from currents, and to find sophisticated ways to recognise and realise the potential of both. That will require a much more dimensionalised view of the marketing, products and viewpoints needed to capitalise on on-going loyalty (big talk) versus those that gain the attention of, and provoke the buzz for, passing interest (small talk).

Another one of those topics I’m sure we’ll come back to …

CEO discretion is advised

Further to the post of a couple of days ago. One of the great temptations of the online age is that you can gain attention. A lot of attention. Very quickly. Do something outrageous – in the case of GoDaddy CEO Bob Parsons, shoot an elephant and display the trophy video for all to see – and people will react.

If you’re the CEO of a company, it must be tempting to think that a stunt like this is creating buzz, getting people talking, raising your brand’s profile. It’s all part of the job, right? All part of the controversy? All part of leading a challenging brand? Just a continuation of getting ads banned from Superbowl or whatever?

The danger for colourful leaders is of course that at some point in the bid, they overstep the mark.

Clearly someone forgot to tell the GoDaddy-in-chief that’s also what makes attention-seeking the ultimate brand honey-trap.

Perhaps he doesn’t care, or notice? That may say something too of course. To some people, it may say quite a bit.

A brand within a timeframe

It is perhaps the ultimate exit strategy – a company with a closing date. This article in the NY Times talks about NPOs such as Malaria No More and Out2Play that have decided their work is done. They’re closing because they have accomplished what they set out to do.

Now imagine doing that with a brand. Setting a date by which you would have achieved set business and social goals along with an agreed return on capital – and ending it there. Too radical? My friend Sam Kebbell set up his architectural practice using that exact premise – a company that would last 50 years. And brand strategist Dan Herman has already successfully proposed just such an idea with his concept of “short-term brands”: brands that focus excitement and buyer loyalty because they are built not to last.

Funny isn’t it how we all acknowledge the pace of change, and how much consumers crave the new, and yet we expect brands to just keep running. Perhaps that’s why they go stale. They need continuing infusions of energy, and as Dr Herman suggests one way to do that is to give them start and end dates, to effectively produce brands that are conceived, brought to market and ultimately concluded as limited editions.

What would you do with your brand if it only had four years to run? You’d make faster decisions, you’d be very, very focused on producing brands with enormous crave factor, you’d look for creative ways to feed that excitement by adding value without adding cost and you’d be very aware of your performance at any given point in time.

Potentially brands could get very short indeed. Pop-up length.

And if you are part of a bigger group, you could even mix up your brand portfolios so that they were set to run and ‘expire’ at different times. 150 year brands, 10 year brands, 3 year brands, 3 week brands … with all the different emotions that such brands could conjure, all reporting to a central story.

Classics and fads … or as Dan Herman puts it, brands as fashion. Chop, chop …

 

Finding the long tail of distribution

This story about how United Villages is using motorcycles, mobile phones and face to face selling to bring big brands to the smallest villages in Jaipur in Rajasthan, India is a stark reminder that tapping tomorrow’s multi-billion dollar markets isn’t about the latest fave apps at the tech conferences.

On the contrary, it’s about simple things like allowing retailers to keep trading by delivering the goods to them. It’s about local reps that the retailers get to know. It’s about something as straightforward as a product guarantee.

This is the real long tail of distribution – a genuinely untapped maze of villages stretching across India, China, South Asia, Indonesia, the Pacific, in fact a good chunk of the earth.

As the buzz from SXSW swirls online, it’s easy to forget isn’t it that massive numbers of the world’s future brand consumers are only now moving out of the analogue age.

 

Beautiful adventures

It seems even iconic hotelling isn’t safe from convergence. Flagship Parisian hotels are now finding themselves challenged by major Asian hotel groups keen to make their mark on the Continent. For the European establishment, it seems, the Far East just got a whole lot closer to home.

The effect, according to Time, will be a 40% increase in the number of luxury rooms in the city, and a classic competitive tug-of-war between iconic Gallic chic and a lighter, more cosmopolitan stay that still emphasises luxury.

Two particular ideas in this story really caught my eye – one as an idea, the other as a strategy.

The first – the idea – was Philippe Leboeuf’s description of the new Mandarin as a “beautiful adventure”. What a fabulous term. Now that’s an idea I can see being applied far beyond the refined world of the Parisian avenues. A beautiful adventure, at least in my head, is both elegant and exciting, it has grace and adrenalin, aesthetic and wildness … It is an idea with the potential to fire the imaginations of everyone from car designers to retailers because it combines such starkly contradicting factors as reassurance with curiosity.

Architects and urban planners – take note. Imagine rebuilding my home town of Christchurch along those lines. Yum. Bilbao on a stick …

The second thought – the strategy – was how the big French hotels intended to respond to the threat of newcomers – because I think it’s an important reminder for all market leaders, particularly long standing market players – facing faster moving, younger predators.

Reshape and remind.

Make the changes necessary to project your business forward, at the same time as you remind everyone of why your jewel should remain a treasure. And the way you do that of course, if you’re a Parisian landmark, is to weave extraordinary and unique stories directly from your history into your reshaped narrative – stories filled with romance and history and torment and triumph. Stories like these:

“the Crillon emphasizes that Marie Antoinette took piano lessons in its drawing rooms, and the Ritz honors Coco Chanel’s 30-year residency there. At the Bristol, managers recount how during World War II, their predecessors erased a suite from the floor plan and harbored a Jewish architect, who later thanked them by building the hotel’s elegant wrought-iron elevator at its center.”

Yet another reminder in itself that even in a business that emphasises staying, nothing stands still for long.

Travelling north

Keith Yamashita has a phrase I love. He talks about companies and brands finding their northern star. The term isn’t astronomical, it’s aspirational. He’s referring to an ideal of your company or brand that burns bright in front of you and your staff, that leads you on, that fires you up and that you never let out of your sight …

It’s the brand and the culture you dream of being. It’s what your people long to be part of. And it’s who your customers always hoped you would be and that your competitors can’t be. It’s what a company’s vision should be all about.

At Audacity, we call it your ambition.

Without it, you drift.

So many people can see that north star in some form. When I ask people in workshops about the company or the brand they dream of working for, they can tell me, sometimes in amazing detail, what it looks like, how it feels to be part of that , what it’s renowned for.

They can see it. At times, it seems like they can almost reach out and touch it. What they often can’t see or touch is how they leave where they are and get to where they would most like to be.

That’s the role of brand strategy in my view. To help a company or a brand find its true north. And then to take you there.

Which north?

Yesterday St John asked whether north meant true north or magnetic north. Good question.

As I said, most people have a sense of what the company they work for should be like. It’s natural for people to look for tangible ways to improve things. As we all know, it doesn’t take long for employees to offer a multi-point to-do list.

Listen very carefully to what you are being told. But, at the same time, be careful how you treat this information. Chances are what you are hearing is, at some level, a variation on today. It is magnetic north – the reality they are naturally drawn to. Taken literally, it’s probably an improvement on the reality people are part of – rather than an indication of where you truly need to be heading in order to be competitive. As Henry Ford so rightly pointed out, if he had asked people what form of transport they wanted before he delivered them the automobile, they’d have asked for a faster horse.

Don’t get me wrong, many of the ideas will be insightful and important and need to be acted upon. They can often represent powerful improvement opportunities: fast and effective quick wins that will help shift the momentum. What’s more, it’s very important that staff see their suggestions being taken up. Many of their ideas will certainly be steps in the right direction.

However, those ideas are unlikely to disrupt your existing model enough to recalibrate your competitiveness. To do that, you need to step-change how people feel about you, how they connect with you, how they understand where the future could be.

You want them to make an emotional shift in direction because you will be asking people to commit to feeling a different way about the company and to approaching their work with a different mindset.

Here’s how I address that. Instead of asking “what do you think this company should be like?”, I ask “what would you as part of this company like to feel that you don’t feel now?”.

I ask clients and ex-clients a similar question if I get the chance – “what would you as a client of this company like to feel that you don’t feel now?” or “what would you have liked to have felt that you didn’t feel and that prompted you to leave?”.

The answers help build an emotional gap analysis of the company you are versus the company your clients and your staff would like you to be. Once you know that, you’re ready to develop a strategy for the emotional connections the brand and the culture must look to generate from the inside-out.

I think true north lies at the end of this question: How will we need to feel and work as a company, and how will our customers need to feel about us, in order for our investors to be making the money they deserve?

Going, going, Groupon …

You know what you think you’re worth. But what are you really worth? Some great points about company du jour Groupon in this article originally posted on Forbes. Most interesting perhaps because the article helps explain why and how value can so rapidly commoditise.

Here’s what I got out of it:

Success quickly generates a wolf pack – 425 competitors and counting have simply copied Groupon’s model. They did so because they could. There doesn’t seem to be any specific IP here that prevents duplication.

After the rain comes the flood. Lots and lots of competing sites in turn could well create “deal fatigue” – once customers have too much of a good thing, they quickly start to feel glutted, effectiveness drops and with it market share.

Why get married? Big businesses can probably replicate this process themselves rather than go via Groupon – or as close as makes no difference to the consumer.

Time for the big fish. Bigger opportunities attract bigger players. As you succeed, your competition also scales. In this case, Facebook and Google have now joined the hunt.

Sometimes regulation can amount to competition – not because legislators are necessarily taking dollars from you, but because they’re actively preventing you from getting to the dollars that are intrinsic to your business model. In the case of Groupon, those regulations include fights over the terms of the deals themselves and their very right to “market” alcohol.

Whose eating all the candy? If I was Groupon I’d be working really hard right now to persuade participants to stay with an arrangement that doesn’t continue to reward them. With just 20% of Groupon customers returning to shops for a second, non-discounted visit, the people who are really paying are the small businesses Groupon depends on. As the Coke model so clearly shows, the way to hold a supply chain together is to enable everyone to make money at every point.

What is Groupon really? I particularly liked Daniel O’Connor’s closing observation: Groupon is more of a business model than a company. If he’s right, then $6 billion is a lot of money to turn down for a business model, even a working business model.

Is Groupon really worth more than Google was looking to pay in December last year. Or will their decision to reject the search monster’s offer turn into this year’s version of Yahoo’s walk-away from Microsoft?

 

The Feynman principle

A review of a review about scientist Richard Feynman in the Freakonomics blog caught my eye this morning because it also provides a simple but telling thought for every brand owner.

The author of the blog post, Sanjoy Mahajan, comments “It’s not quite true that Feynman could not accept an idea until he had torn it apart. Rather, the idea could not yet be part of his way of thinking and looking at the world. Before an idea could contribute to that worldview, Feynman wanted to turn over the idea, to see why it was true, from any angle that he could find.”

We don’t have to look far to see what Feynman was fighting against. Once something has been widely accepted as fact, the temptation is to absorb it unquestioned and to work with it on that assumption. What Feynman did though was to say “you may very well think that, but before I can think that, before I can actually absorb any thought into my worldview, I need to prove it to myself”.

For Feynman, concerns over “you don’t know what you don’t know” seem to have been replaced by a preoccupation with “you should always question what you do know”. I like this idea. After all, it is only by questioning what goes without saying that something new can be said. That it seems is what Feynman did. He re-litigated every assumption not so much to go over old ground but rather to uncover anything that had been missed in order to give himself something to build on. In other words, he used the re-litigation process to extract new value and new possibilities.

So how might you apply this Feynman principle to your brands? Perhaps by asking yourselves this the next time you sit down to strategise: What have we never questioned?

Every price point needs a story

The temptation is to see story as a luxury item: something that brands implement to lift their margin. There’s nothing wrong with that of course – it’s powerful and it works. But I don’t think that story is just a top-end nice-to-have. My view is that most brands, no matter where they are priced in the marketplace, need a storyline.

To understand why, first let’s think about the alternative. Without a storyline, a product is just that. It has everything it needs (hopefully) to do what it’s being bought for but that also means it’s just another detergent, car oil, computer, whatever …That makes it highly vulnerable to house brands and to cheaper versions of what amounts to ‘the same thing’. It also means markets get packed very quickly with variants of the same idea that rapidly diminish the value equation: we talked about Groupon and its 425 competitors a couple of days ago.

This problem of course only becomes more acute as you move down the value chain – meaning that at the very points in the market that are most crowded and where competition is highest, the chances of finding differentiation are diminished, and much of the marketing amounts to little more than a rowdy discounting squabble based on ‘unbeatable pricing’. In point of fact, of course, those positioned in middle and lower markets should be upping their back story to compensate for this lack of differentiation. (There must be an equation in here somewhere, and I’m going to put my head around figuring out what it might be at some later date. Anyway …)

The real power of story is that it provides context, in two senses. First of all, it helps consumers differentiate an offering by attaching more than just functionality to a product. It can also help them understand why a product is priced the way it is – up or down. Ryanair are masters of this. Their price is a clear call to the market – don’t expect much, because you’re not paying much. And everything they do revolves on that premise. They do have a storyline, albeit an unusual one, based it seems on minimalism.

Secondly, and perhaps just as importantly, a storyline gives the brand owner a consistent and differentiated narrative upon which to base and evolve brand marketing. Again, Ryanair play on this with their discussions of stand-up passengers and paying for toilets. Their whole approach to their business and their marketing revolves around ‘how much less can we do?’ Provocative it may be, but it’s also consistent, distinctive and, in a highly effective way, it proves their price point. Even their at-times resentful customer service has that air of the cranky scrooge who insists on you meeting their demands on every aspect of your flight in order to qualify for their unreasonably low price.

Is it really that much cheaper to fly Ryanair than anyone else? Does it really matter? The airline brings that story to everything it does and talks about. Personally, I wouldn’t touch them with a barge-pole (I fly too much not to value some level of experience), but for some people they are utterly irresistible.

Finally, stories introduce humanity. They make you think through and act upon a narrative that is fundamentally rooted in human truths. Stories generate empathy. We see ourselves in the tale. Or we see a side of ourselves. Or we see the ‘me’ that we would like to be. Without that narrative, what are brands going to talk about and how are you going to focus your behaviours? Exactly. Everything is going to be dominated by features and discounts basically. These are much more restricted lines of engagement. And without a storyline hook to hang them on, they’re boring: witness the beauty pageant on any rush-hour ad break for evidence.

3 key points to think about:

Story is the new experience. Everything in marketing goes through phases. For some time, you couldn’t move without running into experience advocates. Experience is still important, but as that too commoditises, we’re now seeing experiences that are informed by stories. This is no surprise really. As marketing becomes more social, brands will need to become even better and more sophisticated story-tellers. It’s a pre-requisite for getting people to talk about you and think about you in positive ways.

Story helps growth. As companies move into new sectors and industries converge via technology, brands will need to spread their story consistently across diversified product lines in order to keep growing. The story will act in some ways as the constant point of connection for products that potentially range hugely in pricing and distribution.

Stories and price need to be directly aligned. Storylines themselves of course are many and varied. Some emphasise history and luxury. Others tie a product to a place or a hero, an idea, a challenge or an outrage. The key to success is to adjust the story you tell to the price you charge and vice versa. No point in telling a luxury story and charging a low end price. The whole thing will just look and feel out of whack. Beer brands have this down to an art – just look at the way lower priced drinks come with grittier and more parochial stories.Masterful.

Little jewels

Last night I attended the launch of my latest “book” – this one, the story of the Victoria Cross with particular emphasis on the 22 New Zealanders who have been awarded the country’s highest military commendation. It was a commission for New Zealand Post, one of a number I’ve done for them over the years on a range of subjects.

In fact, last year was a bit of a year for these larger writing projects because I was also involved in a beautifully-finished corporate history of the Pryde Group, a Hong Kong based company which owns the world’s largest windsurfing and kitesurfing brands.

People have asked me over the years why I get such a kick out of this kind of work. It seems such a long way from the strategic and communications work that Audacity does. And I think it’s because projects of this scale require you to be so curious, to look for the smallest humanity in even the broadest story. You need to find a structure that is robust enough to hold all the vital information, but at the same time, open doors off the main corridor – just to take the reader on fascinating side-trips that are completely self-contained.

There’s a lovely side-story in the Pryde book for example about a man who somewhat foolishly pokes his finger into a cage with a hot-and-bothered ferret in it. Guess what happens next? And what does that have to do with building the Neil Pryde brand? Nothing. It’s just a very human tale built around a surreal situation – what were all those cages of ferrets doing stacked up in the sun outside a fish restaurant in a little factory town in China? We’ll never know. (And perhaps that’s just as well.)

I find stories are most powerful when they mix the chronological with the anecdotal, when they have a powerful sense of progress but then dart off down an alley just so you can have a quick peek. Those side-tracks are not distractions. On the contrary, they add an invaluable sense of dimension. What made the Victoria Cross heroes human was the little things they did or said. That’s what revealed them as men and as New Zealanders. That’s what someone reading the book will really identify with.

The principle of chronology/anecdote is actually much more broadly applicable. In the case of stories about brands, for example, chronology provides credibility, logic, structure and of course direction but anecdotes build legends. They are the high-touch, human side; the behind-the-scenes reveal on what really goes on.

As you shape the story of your brand, you need to allow both to flourish. It’s vital that there is a grounded, prosaic framework that keeps everything in place and that reports to your biggest plans. But remember, it is the anecdotes that foster engagement and humanity. They are the proof that you are keeping your humanity. They are the little jewels that foster recall and community in the tea-rooms across your organisation, and at the pub after work.

Without them, you will quickly lose your sparkle.

Take a chance

Why do consumers go out and buy a Lotto ticket or take part in brand-run promotions when they know that their chances of winning are so very small? According to Kelly Goldsmith in this article in the Time blogs, it’s not because of what they stand to win, it’s actually because of where consumers focus.

Most people it seems focus on the outlay – it’s just a dollar or two. And when they connect that outlay to the potential reward, then they basically believe they have nothing to lose. Involvement appeals directly to the universal love of curiosity, surprise and of course winning. But, ask people to think about the problem the other way round, in terms of their chances of winning, and interest wanes substantially. In other words, where something is portrayed as hopeless, we find it much harder to justify even a small amount of money.

We’re hugely inclined to chase a dream if the price to do so seems small enough, but that interest declines rapidly when we’re reminded that we’re unlikely to get anything back.

That’s also why people travel to Hollywood, or try and break into the music business, or look to publish a best-selling book, or attempt to become a big-time motivational speaker. That’s what ensures that talent agencies, publishing houses and speaking bureaux stay in business. That’s what gets thousands and thousands of people to queue to audition for Idol or Next Top Model or Project Runway. The industries are adept at getting people to bet time, money and talent by publicising the potential rewards – prizes for which the outlay seems relatively small.

Maybe it’s the thought of gaining next to everything for what seems like next to nothing. But the irony is delicious isn’t it? The very thing that makes the game work and seem exciting – participation – is also the very thing that prevents almost all those who take part from winning.

What would you Like?

In this discussion on whether Liking a brand on Facebook makes you more inclined to be positive about that brand, writer Gregory Ferenstein says that rationalisation theory suggests “our actions secretly influence our opinions”.

I’m sure that’s right. We do something and we justify that action to ourselves. When we “like” a brand, we tell ourselves it’s a better brand than we might have thought it was otherwise. We make a public endorsement and we stand behind it. When we pay for something that makes us feel good, we feel better about that brand. And when we buy something alongside many others, we feel more secure because we are not alone.

The dealmaker or breaker though is that we do get what we thought we were getting – and this is where brands need to be so careful in framing expectations. If I take an action, and the action turns out to be better than I expected, I will be pleasantly surprised and I will naturally carry that through to my view of the brand. Zappos 101. Happy actions make for happy opinions.

But brands can get it very wrong in two ways.

The first is that they induce people to take actions under an expectation that never is going to be met. You see this with budget airlines all the time – where people buy expecting that they will get some semblance of the full service they’re used to. When they don’t – and they’re charged for bags or barred because they’re late – their opinions go through the floor. The actions that were taken didn’t align with the actions they were expecting, and as a result, they are bitterly disappointed.

Here’s the question. Who’s at fault? The airline – for not being clearer about expectations? Or the customer for not understanding what they were buying? I blame the airline – and here’s why. They have more to lose. If you want to avoid having disappointed customers, you have to presume that people assume. For the sake of your brand, you need to start from the point of view that unless and until your customers are told they can’t have something, they’ll assume they can. You can’t just hide that in the T&Cs.

In other words, if you want people to “like” what’s happening, you have to tell them what they don’t get – and you have to link that to what they are getting. “We close our flights off 30 minutes beforehand because …” And the “because” needs to be something that is relevant to the customer not the airline. So don’t talk about resourcing or policy or anything like that. Link it to the buyer.

For example, here’s how you might get someone to “like” the luggage policy. “Bags are heavy, and weight uses up fuel. The less bags you travel with, the lighter our planes and the less fuel we have to burn, which means you continue to pay lower fares. You can bring more bags if you want to, but you’ll have to pay for them. We think that’s fair to everyone.”

The second way brands can get it so wrong is when they think customers are taking one action when in fact, they are taking quite another. For example, offering a brand at a discount may entice people to buy – and brands may think that because customers have bought once, they will buy again, only next time at full price perhaps. The good old lost leader theory.

Except that’s not the real action in many cases. The real action – the one customers who buy this way are really liking – is not paying full price. So the real opinion that such an action influences is that the brand is not worth paying full price for.

Be careful how you judge the likings of others. What and why they “like” may be different from what and why you’d like them to “like”.

The difference between less and off

If I buy something on sale, what should I get? 40% less – or 40% off? They are very different things.

If I purchase something for 40% off, that means I get what I would have got if I’d paid full price but I get a 40% reduction on the asking price for the very same goods or services. The result, as we’ve discussed many times, is that the brand’s perceived value deteriorates and, if enough retailers participate, the actual market value of the brand also drops.

40% less on the other hand means I pay a lesser price but I get less for that price. How can that be? Surely a pair of shoes is a pair of shoes, right? Not necessarily. One of the first rules we were all taught in direct marketing is that it is much more economical to give than to take away. In other words, it is much more economically sensible to add services to a product in order to make it more valuable than it is to discount the asking price.

That’s because the price I can pay to add perceived value is generally much less than the cost of taking money away. Airlines are very good at this. You pay a lot more for a Premier seat than you do for an Economy seat – and in exchange the airline gives you a bigger seat, a different menu and perhaps more movies. They add to what you get, at a lower cost to them, than the revised price they ask you to pay.

But there’s no reason, on reflection, why that process shouldn’t work in reverse. In other words, what’s the reward for paying full price? Take our shoes example. What’s 100% worth? What does a customer get for paying full ticket that they wouldn’t get if they bought the same product in a sale? Because it’s only by establishing that, that a brand can establish what the new receivables are for 10% off, 20% off, 40% off … If I pay full price for the shoes, perhaps I should get a free fitting, my first replacement heel free, a 14 day money-back guarantee and a shoe care kit. If I pay 20% less, I don’t get the replacement heel and I have to pay for the shoe care kit. You get the idea …

The beauty of this arrangement is that it allows those people who just want to buy on price to do so, whilst simultaneously encouraging those who buy on value. Just taking 40% off and delivering the same as 100% doesn’t do that.

Upsizing the impact

Interesting isn’t it how we perceive messages. 50,000 jobs on offer at McDonald’s sounds huge, but it actually averages out at around 3 – 4 positions at every restaurant in the U.S., which suddenly doesn’t seem anywhere near as impressive.

I have no doubt that McDonalds could have quietly filled those positions by advertising locally. But that would have significantly pixelised the effect.

Instead they chose to offer all those tens of thousands of positions on one day across the nation. All that hope, all at once. A dollop instead of a glimmer. A chance for the applicants themselves to be part of something that felt so much bigger, so much more powerful, so much more universal. A chance for McDonalds to make its presence felt and to reinforce its credibility as an employer brand. An event big enough to set social media abuzz.

The next time you’re planning to a “soft” release, maybe ask yourself this: What could we do to upsize this? And how big would we have to make it to get the world’s attention?

Everyone expects to be rewarded

According to this post in the NY Times, Americans racked up about $48 billion of rewards via fly miles, hotel rewards, credit card points and other programmes in 2010. The average household it seems has 18 loyalty programmes and earns $622 a year in miles and points. So, roughly $35 value per programme per year. And yet nearly one-third of that amount will go unclaimed.

You can read this as proof of the ubiquity of rewards systems, but what fascinates me is the clear expectation of consumers that they will now receive rewards in some form for so much of what they do, whether they cash them in or not.

Once loyalty was. It existed out of convenience or preference, habit, range or relationships. Now, for many brands, loyalty costs. Sure, you get to keep the customer, but you keep them on retainer. You keep them by pumping incentives at them whenever they buy. And the irony of those incentives, looking at the stats above, is that such generosity doesn’t count for anything up to 33% of the time.

The dilemma for any brand that depends on loyalty programmes to keep its customer base motivated is this: the more you give, the more it’s expected but actually the less it means.

How real is the value of reality brands?

Last night I sat down and watched Inception. Today I spied this article on the Kardashians – and I couldn’t help but wonder whether the dream states of the film mirror the “reality” of the brand value of reality brands.

The Kardashians appear to be a retail success story, for now, and we’re told they have raked in millions. What’s the business model? Their “real” lives? And those millions of followers – what are they following? The real Kardashians or three levels down?

Does the Kardashians’ show and product portfolio add up to a brand, souvenir merchandise or fashion? Does that become stronger, or more real, when it diversifies?

Why all the questions? Well, because if I was Sears, and I was looking at setting up a Kardashian shop within my shop, it might hugely influence my decision to know what exactly I was partnering with. Of all the celebrities in the world, why them? What’s the connection between what they are and what Sears represents? And, as I say, is what Sears are seeing in the Kardashians really their brand?

Have Sears nailed an astute marketing association or have they too been caught up in what appears to be happening around them, and are hoping it somehow rubs off on them? Can that even happen? Whose really dreaming here?

Spin the totem. Guess, we’ll see.

Mind games

Here’s another of those inconvenient questions: is it really worth our while for New Zealand to be involved in hosting global sporting events? Or more to the point is it worth our while, the way we go about it? Yes, I know … participation, competition, world stage, all that … but given that it’s actually costing us significantly more than we can expect to make to host the Rugby World Cup, for example, how do we intend to get a payback? And the $36 million for the America’s Cup – what are we projecting that will bring home?

My sense is, it could be worth it – but it probably won’t be. I don’t get the sense that each of these initiatives is a calibrated and layered contributor to a defined and well-laid out New Zealand strategy designed to get the nation from point A to point B by lifting our competitiveness and our margins. In fact, I don’t get the sense that the Government has an economy-wide story right now that will gain us a step-change.

On the contrary, the approach I’m seeing seems somewhat akin to throwing multi-million darts at a global events board in an increasingly desperate search for an economic bulls-eye. These are multi-million decisions that, on inspection, are far too piecemeal, and require far more money to make them truly pay their way than New Zealand has available.

We have stories, and some of them are amazing stories: a tourism story; a yachting story; an All Blacks story etc. What they don’t add up to, and report to, is a compelling value equation.

Don’t get me wrong, I’m a huge believer in the need to invest in events – but given how much these particular events are going to cost, were these the best events for New Zealand to choose? Are they delivering us bang-for-our-buck or just expensive bragging rights?

What do they give us an opportunity to tell the world that the world doesn’t know already? How do they add value? And how many more times will we make mistakes like these?

In this article in the Herald, the Minister says the World Cup will have lasting economic value for New Zealand because the country will be building its brand on the international stage. “We convince more tourists to come here, we convince more businesses to do business here with New Zealand companies and enter partnerships with them.” That sounds great. But the numbers don’t bear that out at all. New Zealand isn’t going to make anything. In fact, we’re staring down the barrel of a $500 million loss. So if you thought the price of admission to the RWC games was high already, it just went up $120 for every man, woman and child.

And the America’s Cup. OK, I get that in some form it might help our boat-building industry, but where does it specifically contribute to the wider NZ brand story? How do a bunch of freelancers in a catamaran add to our national competitiveness? It’s not a facetious question.

If we got offered the Olympic Games or Formula One, would we take those too, knowing that the cost-benefit ratios would be irresponsible? (Just so you know, I think the way such events are priced and structured generally makes them an irresponsible decision for most countries.) The sad thing is, I think New Zealand might be sorely tempted. For all the same reasons.

It’s healthy to love sport and competition. It’s irresponsible to get involved in directly and publicly funding events that don’t advance our national brand and our national economy.

Which leads me to all the arguments we keep hearing about intangible benefits. Intangibles in this context strike me as a concise way of saying that no-one actually knows what we’ll be getting, but they’re sure there will be something.

I have no doubt at all about the sincerity and commitment of those preparing for the Cups. But I’ve never seen a strategy yet where an incoherent story championed in different ways by a whole range of parties with different agendas suddenly gained traction and delivered “intangible benefits” that amounted to hundreds of millions in real economic benefits for everyone.

What do you think?

Telling

What gives you the right to sell a product/service at margin today? It’s easy to assume you have a mandate. Or that you deserve one. But what is your brand doing to earn/retain the mandate it wants/has?

Don’t tell me it’s because you opened. Because presence isn’t enough.

Don’t tell me you worked hard to get here (past tense). Because then you’re relying on your history.

Don’t tell me you’re doing a good job. Because most everyone’s doing a good job.

Ditto service, people, methodologies, products, channels, technologies, systems, processes, efficiencies … for most companies anyway.

Talk perhaps about the scarcity of what you offer, or the richness of the ideas that you encourage, or the loyalty you forge, or the need you are meeting that your competitors don’t, or the insights you’ve developed and applied that are truly valuable, or the excitement you generate, or the journey you’re taking people on, or how you are looking to generate the most wonderful change … Better yet talk about how you’re combining ideas and where that’s taking you.

Actually, don’t tell me at all (unless we’re working for you). Tell yourselves. Every day.

The assumption paradox

It’s easy to assume that your customers love your brand, that they are loyal, that they have every reason to continue doing business with you, that they want the next upgrade. It’s easy to assume that no-one noticed or cared about that little slip-up or that if they did, they  understood. It’s easy to assume that your customers will continue to want what they have always wanted. Or that they will never want something back.

It’s easy to assume that everything is fine – that privacy is beyond risk, that people don’t need to know that your phones could potentially track movements, that hackers can’t break into your online games, that people’s details are safely encrypted, that the takeover bid is too low, that your shareholders want to stay or that the market will continue to rise – or fall.

If we each had to worry about the alternatives to each of these things all of time simultaneously, we’d go mad. So we assume. And it’s easy to do so because assumption is simply an expression of our individual worldviews. In choosing to see the world a certain way, we each make assumptions, form schemas, to fill in the blanks.

We have to.

The paradox is that while assumptions equalise our world, not all assumptions in that world are equal.

The dilemma for any brand is to sift the assumptions it must make in order to bind its customers together and efficiently achieve its goals as a business from those that it must break with in order to offer a distinctive and competitive alternative to what everyone does; to what everyone else has assumed for too long.

Never stop answering

Let’s return to two posts from April – because one actually answers the other. Last Friday, I discussed the paradox that while assumptions equalise our world, not all assumptions in that world are equal, and that the dilemma for any brand is to sift the assumptions it must make from those that it must break with.

Efficiency vs distinction.

My sense is that the way to do that is through what I’ve dubbed the Feynman principle – a nod to Sanjoy Mahajan’s post about Richard Feynman  mentioned earlier in the month. This principle – you should always question what you do know – focuses on methodically re-litigating assumptions in order to uncover anything that had been missed and thus to extract new value and new possibilities.

But how do you stop this becoming an endless loop of making assumptions then questioning those assumptions?

By introducing answers – but answers that are themselves subject to continuing reappraisal.

In other words, the response to the Feynman principle of ‘never stop questioning’ has to be ‘never stop answering’.

That in turn means that the answers themselves are not definitive. They are both conditional and iterative: always subject to further questioning; and always morphing because of that questioning.

True is true, until and unless proven otherwise. And it is that need to prove, one way or the other, that mitigates assumption.

Systems and frameworks stand between this approach working and anarchy. A systematic approach to questions mean a manageable quantity of questions are being asked and answered at any given point. And the right frameworks ensure that the answers are explored, along with their implications … before new questions are raised.

It’s complicated

I really like this thought from Lars Bjork, CEO of QlikTech, in an interview in the NY Times: Love order, hate bureaucracy, he says … “Order is where you put a process into place because you want to scale the business to a different level. Bureaucracy is where nobody understands why you do it.”

I’m constantly intrigued at how systems take on a life of their own. Everybody witnesses it. Everyone agrees it happens. What starts out, innocently enough, as a way of checking something soon grows its own mandate. It invades other areas. Then it gets a righteous title or attaches itself to a critical area (compliance, operations, efficiency, policy, framework etc), spawns a budget, a project team and a management structure, and suddenly it’s part of the war on chaos. It stalks the organisation gathering strength and credibility with every meeting.

Before long it’s part of the sign-off, and once legal and HR take it under their wing, it’s part of the furniture. The sign-off gets longer, harder, more involved.

‘How’ overtakes ‘what’ and ‘why’. The pursuit of the paperwork becomes a self-appointed Holy Grail, to the point where something’s not right if it doesn’t have the ever-increasing stamps and signatures. The business becomes utterly accountable to, and limited by, the bureaucracy. And the fact that no-one really understands what happens, why it happens, where it leads, why it’s needed, who authorised it, what difference it makes or why it was even devised only seems to add to its mystique.

Next time you go to a meeting and someone suggests something, check for two pieces of feedback: “We can’t” and “We’ll need to …”. Chances are, that’s bureaucracy making its presence felt.

Which is why I’m so drawn to Bjork’s observation. Success stems from having and finding ways to get to where the business needs to go. Those are true processes. Anything else is not. Bureaucracy is cipher for barrier.

And it’s about recognising too, as Bjork observes, that systems have an inherent tendency to become more complex. The more we do something, it seems, the more we try and factor in every eventuality, every contingency, everyone … and things take on an internal logic that is utterly baffling and yet strangely compelling and reassuring, all at the same time.

We structure bureaucracy on assumptions backfilled by layers of history – ‘it must be this way, it needs to say this, it requires five of these’ – when we should of course structure everything the business does on questions. One in particular – Does this (process) get us to there (goal) as quickly and simply as it can?

That’s the chase. Cut to that.

What they see is what they brand.

Oh the irony. For years, many of us tried to get the people we worked with to broaden their understanding of what a brand was. It’s not just a logo, a product, a TV commercial – that conversation. We were fighting to make the definition of brand bigger. Now I’m wondering whether we have to start going back the other way.

Suddenly, there are no people, countries, groups anymore. Instead, everywhere I look, everything’s a brand. Donald Trump is a brand, Charlie Sheen is a brand, so are Kate and Will, the President’s a brand, Greenpeace and just about any professional sports team or association you care to name. America’s a brand, so are the Tea Party, Survivor, Wikileaks, the Beckhams and Lady Gaga.

That suggests to me that the media is in the process of redefining a “brand” as anything that gets or has our attention. In the new parlance, brand now is much more about profile. So I think Paula Lynn is right when she comments on this story in MediaPost that, “The media and its frenzy make brands brands.”

Brand increasingly means buzz, or perhaps something or someone that is buzzed about: something or someone who has got or is getting attention, for good or bad reasons. (Aligns with my post last week about the real value of reality brands.)

Visibility is credibility. Which comes back, in a strange way, to what those of us who were there used to say when people told us a brand was just a name or just a logo: “There’s a lot more to it than that.”

Today, I’m much more afraid there’s often not. Use has subverted meaning.

Plenty of ideas coming out of AG Ideas 2011

I was lucky enough to be invited to watch the AG Ideas 2011 plenary yesterday morning via the simulcast into Wellington’s Te Papa museum.

My highlights:

Definitely the video of the kids workshop, with two stand-out examples of great design ideas by young minds that, as Ken Cato pointed out, do their creating with no preconceptions.

The first design suggestion: a hot dog with legs, so that, in the words of its young inventor, overweight people, who love hot dogs, would have to chase them and thus burn calories.

And then, the second suggestion, via this exchange:
Ken Cato: What have you designed?
Child: It’s a surfboard with flames.
Ken Cato: How would that work? The flames in the water …
Child (slightly impatiently): It’s a new design.

Of course, the brief notes that follow cannot do justice to the presentations of the four featured speakers, but I thought I’d pick up on some of the thinking that particularly struck me, because it intersected with, and informed, the things that fascinate me – and, at other points, it straight-out widened my awareness, which I think is where conferences like this are always so powerful.

Sarky, from All of Us, quoted Clay Shirky’s point that for the first time ever being part of a globally interconnected group is normal, which put everything that followed into a very real context. And I just loved his thought that all things are technology at some time. Glass was technology at a point in history. So were pens and bread. Also liked his contrast between coherent and consistent. Brands, he pointed out, have tended to be consistent. They will be a lot more powerful into the future if they are coherent. Less clone, more spirit. Big tick for that thought.

Natan Linder from MIT Labs took us on this extraordinary journey regarding interfaces and about how they define experiences. He highlighted some examples of how the Labs team are looking at how we can literally use the world as an interface, and that, with this kind of thinking, the world actually becomes a store. I sat there hoping that people like Paco Underhill and Martin Lindstrom were onto what Natan and his team were doing. It inspired the retail out of me.

Susan Bonds told us the amazing story of how Nine Inch Nails built an interactive, multi-media concept that took in digital, music, concert and a whole bunch more channels. My notes though seem to centralise around the observations she wove through the presentation:

• The challenge of stories is that they need to generate active engagement that at first spans minutes but then must extend through to years. Stories need to go on an emotional journey that evolves from discovery to ownership.
• When she talked about how her company, 42 Entertainment, builds games, I was very taken with the idea of moments that intercepted with people, and that it was those points of interception that generated experiences.
• She talked about building a whole world out of fragments, which I interpreted as creating pieces rather than vistas – bits that stick and come together to lay the world before your eyes.

Dr Shane Moon spoke about neuro-marketing and how you can use techniques and ideas to influence very difficult audiences like teenagers and even change their behaviours. I was struck in particular by two particular thoughts in his presentation. The first was that creative people have tended to see research as the stifler of great ideas whereas in fact, as his Roads Victoria example showed, understanding how your audience really think can make the creativity so much more real and informed, allowing you to pursue lateral approaches. The other thought I liked was the observation that it is not what you experience that matters, but rather what you recall about what you experience. The emotive memory, in other words, is more important and is much more influential than the actual memory.

All this and a lot more, packed into two hours. Huge thanks once again to the Cato team for the invite and the hospitality.

What do you do?

What do you do?

- I write.

Doesn’t just about everyone?

- What do you mean by that?

If you can form a letter in any language, you can write. What do you really do? …

Here’s where this goes. Writers don’t write. Writers give people reasons to read. That’s what distinguishes them from people who can put things in writing.

Speakers don’t talk. They give people reasons to listen. That’s what distinguishes them from everyone with the gift of speech.

And photographers don’t photograph. They frame a moment in the world. That’s what makes their work different from someone with a mobile phone.

The differences have never been more important in a world where so many people have access to technology that allows them to design, publish, print, record, point, click, template …

What do you do, when anyone looks like they can do what you do? So often we want to base those differences on techniques. We do it better. Or history. We’ve done it longer. Or experience. We know more. Or frequency. We’ve done this more often.

Here’s the thing. It’s a much stronger equation when it’s not about you.

The real value and competitiveness of what you have to offer changes when you stop thinking about what you’re interested in, and start thinking about how others really benefit from your work.

The power of interesting

I think we’ve all seen the movie about the ad agency that starts telling the truth only to find that business booms. Funny then how fiction turns to fact with news that in 2010, Domino’s US same-store sales rose 9.9% in a market where 1%-to-3% growth is closer to what’s generally expected.

And the way they did it, according to Time, was by publicly trashing their old product, and encouraging consumers to check out the improvements they had made. That, it seems, got people back into the shop, intrigued by the admission and keen to taste what had changed.

On the face of it, as I’ve said, this looks like a case for more truth in advertising, and of course to some extent it is. But I’m not certain that’s why the campaign actually succeeded – and I certainly don’t think it’s an approach that Domino’s could use again to such marked effect.

What this story shows me, and what Susan Bonds’ speech reinforced last week, is that a generation notorious for its inattention will pay a lot of attention to things that attract and keep their attention. The truth worked for Domino’s because it got attention. And it got attention because it was interesting and the new product was interesting.

Maybe that’s how we should really analyse retracting brands: not so much as companies that have lost market share but as companies that have lost market interest. That explains of course why established brands die. They become so cautious, they literally die of boredom in spite of multi-million dollar media schedules and aggressive discounting.

As marketers I think we’ve generally been taught to over-estimate awareness and under-estimate curiosity. As the composer John Cage once remarked, “I like being moved. I don’t like being pushed.”

How to win

I’m always interested to see how successful people think and to learn how they go about building competitive marques. In 2009 – 2010, in the course of working alongside Alex and the crew at Milk on Will to Win, a history of the Pryde Group and its brands, I spoke with Neil Pryde many times.

On a number of occasions, he talked about how he approaches running a global business. I thought I’d take a moment this morning and share with you the philosophies Neil shares in the book:

1. Strike the right balance between measured risks and natural optimism.

2. If you look back at your career and you’ve made more good choices than bad, you’re ahead.

3. Love what you do – but not too much. Too many businesses are wrecked by emotional decisions.

4. Be paranoid. Recognise that nothing is static. React quickly.

5. Never forget that sport is the business, and the business is a sport – always, play to win.

6. Always be prepared to walk away. If you’re going to fail, make sure you fail fast and move on.

7. Document. Everything.

8. One of the great myths of delegation is that you give away control. Never give away control.

9. Don’t carry. Be profitable at every step in your business. It’s part of the discipline.

10. The best relationships happen face to face. Technology hasn’t changed that.

11. Costs are opportunities. In a manufacturing business, over half your product costs are in your materials. Every percentage point you can save on materials makes you more competitive.

12. Plan as much as you can. Even though most plans seldom survive their first contact with reality, that’s still a whole lot better than having no plan at all.

13. Don’t burn bridges. It’s amazing how people you think you’ve said goodbye to can come back into your life, sometimes in the most surprising ways. You need to be able to work with them the second or third time around as well as you did the first time.

If you’d like to get your hands on your own copy of Will to Win, it’s available online.

Now playing

Slowly it seems everyone is coming round to the idea that content owners and developers and a new generation of distributors need to start working together. What interests me is how those content developers increasingly see social media as a valid outlet.

YouTube has announced that it’s going to start renting more than 3,000 mainstream movies for as little as 99 cents each. That marks a real opportunity for quality shift for YouTube, from home videos to slick studio-quality product. But it also shows another move towards smarter monetisation of the social media model for both parties.

The term ‘market share’ takes on new meaning in this context, in that it combines the marketable product of the studios with the massive sharing networks of the big social media outlets. One thing that YouTube, the film studios and Facebook share that I think offers real opportunities for these various emerging alliances to work: they absolutely understand the need to keep people involved and interested. Their presence and growth is predicated on that – even if they have, and continue to, come at generating much of that involvement and interest from different angles.

I don’t see that synergy in the other big tech news of the week – the Skype acquisition. What I see there is Microsoft buying a very large customer base for a lot of money that by and large is very used to paying nothing for the service they get and that may or may not be Microsoft-friendly. YouTube visitors by contrast are already watching movies. This latest development just shape-shifts the nature and scope of what viewers have available to them.

The deals are interesting, but what we’re seeing here in my view is the start of a bigger showdown. The rise of content is ubiquitous. Now the fight is on in terms of how to manage that between brands that are bought and brands that stay separate but share. Control vs flexibility – an age-old dilemma, reiterated.

Weasel hunting

In what may well turn out to be a Pajero moment in politics, Newt Gingrich has kicked off his run for the presidency under the theme Win the Future – which shortens, conveniently, to WTF.

How appropriate. I’m baffled. You’d think wouldn’t you that someone might have noticed? Especially given that the comedy community had already had a field day.

If I’d known about this yesterday, I would have quoted it at my “Wallop the Weasel” workshop as a classic example of weasel – hollow statements that look to be slick but come across instead, at the first hint of investigation, as BS (which, just so we’re clear, does not stand for ‘be strong’, ‘beautifully strident’ or ‘buff spokesman’).

Here’s some more mainstream examples: 100% natural (how can it be anything less?); 25% less fat than normal (when normal means packed with fat, this is hardly a benefit); friendly fire (like it somehow makes any difference to the outcome).

Even in its full form, what the hell does “Win the Future” mean anyway?

It’s tempting to think that open statements like this are clever marketing because they will impress people and win them over. But if you set out to produce ‘weasel’, it doesn’t take long before you systematically get around to producing nonsense. All that double talk ends up spinning Emperor’s new clothes statements that the market sees straight through – and yet all your signals internally are saying is sensible, considered, effective, short and packed with meaning.

Clearly Mr Gingrich’s people believe his campaign has meaning – oh what a meaning it is.

Brand affinity: 10 ways to build a truly likeable brand

Most brands would say they want to be popular and many of them would see social media as a way to achieve that. But recently David McInnis wrote this in a comment: “You can have all the social pieces in place but doing so does not make you likeable. Most companies that have a social strategy should not. They should focus instead on being likeable first.”

In other words, social media alone won’t improve your affinity as a brand. A great observation. Tempting isn’t it to roll out the social artillery without first thinking about whether a) anyone gets on with you b) wants to socialise with you and c) will bother to give you the time of day even if you do make the effort.

In his book The Likeability Factor, Tim Sanders talks about the need for people to build their own likeability by focusing on four critical elements:
• Friendliness: communicate liking and openness to others
• Relevance: connect with others’ interests, wants, and needs
• Empathy: recognise, acknowledge, and experience other people’s feelings
• Realness: guarantees its authenticity

So, what does it take for a brand to be likeable? I figured this functioned as a good starting list for those keen to build closer relationships with their customers:

1. Be real – authenticity goes without saying. It’s as true for brand as it is for people. Don’t over-promise, hyperflate, deceive, lie or engage in what is, or feels like, dubious behaviour.

2. Don’t play us and them – increasingly, brands must look to identify with their customers as part of a shared community rather than engaging in the old-fashioned seller-buyer dichotomy. That sense of community generates both relevance and empathy.

3. Be different but be intriguing– do enough to stand out and to bring a real point of view to your work but don’t get so out there that people literally don’t recognise you as a brand that is part of a sector. People need shortcuts. Don’t be a dead-end, but don’t be just another shop on Main Street either. You want people to talk about you. Be different enough to get that word of mouth.

4. Work at it – the competitive environment in which brands work tempts behaviours that are aggressive or corrosive. Work actively to stop yourselves being subsumed by such behaviours. Work at affinity – being friendly, not gooey, but engaging and inclusive to the people you want to bring into your brand community. Provide experiences that people want to come back for, not just tolerate. Have rules for how you will compete that extend beyond what you are bound to do lawfully.

5. Smile – Work to a purpose that generates joy. Give yourselves as an organisation a ‘bigger cause’ to work to, and you’ll find people want to commit, both inside and outside the organisation.

6. Show interest – and be interesting – Interest is a two way street and social strategies in particular offer immediate and ongoing opportunities to engage ‘i-contact’ (that feeling of personalisation that makes each party feel included and involved). Talk about the things your consumers feel an affinity for and want to hear about, not just what you as a brand want to holler.

7. Take responsibility – fess up. When things go wrong, say so, and update regularly. Keep your community in the loop. Don’t just hide behind the lawyers and your risk management framework. Front. Be true to yourself and to those you want to trust you.

8. Get on their wavelength– Get to know them, don’t just presume you know them. It’s amazing how many brands think that because people buy their stuff, they know what’s going on in their heads. You can’t just do the quant and the qual and regard likeability as done. Look for patterns in key places like social media measurement. Find the intriguing breaks in patterns. The purpose of research, in my view, is not to confirm, but rather to explore. So look for what people believe or don’t believe that surprises you, not just the stuff that aligns with what you already know about your brand.

9. Be what they’re looking for – Anticipate. Think of innovation as the ability to be at the next intersection waiting for your customers to arrive. Get it right and they’re going to love what they see, because you did what they didn’t even know they wanted, until they saw it. In today’s upgrade culture, everyone wants the next thing, the next app, the next intriguing idea. Encourage them to look to you not just for delivery but for guidance on that. When you own the vision, you own the future.

10. Be confident– Have faith in who you are. Don’t just like,  love what you do. Don’t slavishly chase the latest trend or the highest profile competitor. Don’t imitate.  Don’t just concur in the hope that will make you more popular. Bring the confidence of a point of view, but the humility of objectivity, to everything you push for. Consumers need to see you believe before they will.

Those are my 10 steps to affinity. What would you add?

Portion control

Often we don’t leave a favourite brand because of anything dramatic. In fact, quite the opposite: the experiences we have quietly fade to the point where there’s less reasons to stay than to go. One day the food isn’t quite as good as it was, the movies on the flight haven’t been changed in a while, the person we spoke with just now was that little bit less warm, the changes in the insurance policy are more inflexible and the biscuits in the pack are smaller and taste different.

Brands make these changes with the best of intentions for the business. They do it to save money, to introduce a shortcut, to be more efficient. It’s just a little change right, a little reduction – think of it as portion control. No-one will notice. And most people don’t.

Unfortunately, the people who do notice are the people who have been loyal to the brand. They know where this is heading. Not today perhaps. Not tomorrow. But at some point, this is going to be yet another formulated cheap experience. They know because it’s happened to them before. Many times before.

So while the brands are congratulating themselves on what they’ve got away with, there’s a good chance that the top x% of their customers are mentally packing their bags.

What will LinkedIn link into?

LinkedIn finally goes public today. This is going to be fascinating – not just to see what this IPO for a name social media company gets, but also to see what investors themselves are buying into. Are they riding a media wave, as is suggested here, or do investors see real and continuing value in B2B networking?

My suspicion is the former, and that’s not good. Long after the hype and the bullish sentiment of launch, it’s the latter that is going to platform LinkedIn’s growth. After all, being a social media company is LinkedIn’s channel, not their strategy. And we all know what happens when investors plumb for a channel at the expense of a viable way forward.

Nothing I’m seeing in the press suggests a worked out plan to meet Wall Street’s expectations in that regard. In fact, quite the opposite. LinkedIn does not expect to be profitable in 2011 and its financial performance to date hasn’t exactly been inspiring. I raised this point last week about the Skype purchase and I’ll raise it again here. When your business model and your brand reputation is prefaced on what people can get and do for free, monetising the model remains a challenge. How are they going to link their reputation and awareness to a money engine?

LinkedIn will have a great day today. I hope they enjoy it. Personally, I love the platform and I wish them the very best. But I can see some sleepless nights ahead in the months ahead when the analysts come calling.

Taking it personally

There are days when the commercial creative process really does feel like blinding optimism in the face of unrelenting stupidity. And that’s the problem – it’s so easy to adopt an ‘us and them’ mentality, to slip into ‘right and wrong’, ‘enlightened and ignorant ‘…

The working environment for marketers and branders is such a strange mix when you think about it. The need to give so much of yourself and yet not take the inevitable backlashes, compromises, negative feedback, rejections, legal insertions, snipping and blandishments to heart.

In a discipline where getting people to feel something for what you sell is everything, the temptation to become detached can be great indeed. Sustaining a great brand though relies on believing in people, both inside your walls and beyond. Once care leaves the room, everything that makes a brand compelling soon follows: passion; commitment; excitement …

Branding is personal and commercial. Hard as that can be sometimes, in the B2C world particularly, it has to be that way.

What will be, will be?

Well, in the words of the song, looks like we made it. The world didn’t go into rapture over the weekend. I checked with some of the most God-fearing, Christian people I know and it seems all of them are still here. Think of this as another prediction that didn’t quite make it – like bird flu from a couple of years back, or Y2K.

We’d all like to think we have a greater understanding of what’s ahead than we do. And while sceptics may scoff at what was foreseen for May 21, the fact is that people make predictions and indeed projections every day. Markets depend on it. Without opinion, emotion and uncertainty, they’d be no derivatives market for example, because they’d be no motive for volatility, which is, after all, the lifeblood of trading.

We want our brands to be predictable too. We want to know where they’re heading. And yet, at the same time, we need them to be refreshing and interesting.

To me, the art of branding is pinpointing what must change versus what must stay still. It’s a strange alliance of familiarity, response and initiative.

• Familiarity – enough of what we know about a brand needs to remain consistent enough for long enough for us to recognise it and treasure it. This is the bedrock. Change at this level happens very infrequently.

• Response – markets change, competitors change, customers change, businesses change – and brands need to be able to move with those currents. This to me is the most changeable aspect of a brand. This is where the tweaks and the upgrades happen.

• Initiative – to avoid being a passive player, brands must take the lead. They must be prepared to innovate. These are the changes that happen over the medium-term. They take that much longer because they have greater scale, require greater energy and, if done well, motivate your competitors to rethink their own position.

Prediction plays a part in all of these decisions and getting any part of this mix wrong can play havoc with a brand. So here are some of the questions I ask to help arrive at the right mix of decisions.

1. What is the basis for the relationship? What are the things that a customer most looks for as signs that everything is tickety-boo? It might be the identity, it could be the service, it might be the attitude … something in people’s hearts underpins the relationship, or at least tangibilises it for customers. That’s a no-go zone unless the very fundamentals of the brand are the things holding it back.

2. What are others doing? Where are they making inroads? What excitement are they generating in the marketplace and why? As a general rule, I build these decisions around how the brand will achieve its own objectives by directly confronting or countering competitor plays.

3. Finally, where’s the unexplored territory in the market? What’s no-one thinking of or about that the brand could claim the high ground on? It might be a social position, it might be a service extension, it might be a learning from another market?

The key aspect is that every projection is just that. An educated guess as to what will be required in the future. And like predictions, you cannot assume that, once made, these changes will automatically make all your wishes come true. They require their own metrics and of course they need to be tracked and responded to as carefully and objectively as possible. The moment you believe you know where the market is going and how people are going to react, you set yourself up for … disappointment.

Well, well, well

When place branding specialist Simon Anholt explains in a podcast why nations need a carefully thought through brand strategy to which all players in the economy subscribe, he quotes the legendary David Ogilvy who once said, “If all you want to do is attract attention, then you put a gorilla in a jockstrap”.

As Ogilvy himself explained it, if you want to get recall, you then put the brand on the jockstrap itself. You will certainly get buzz, and people will remember the stunt. But will anything meaningful, in commercial terms, happen beyond that? Doubtful.

And the reason is that having got people’s attention, you need to do something with that energy. You need to direct it somewhere. You must provide a meaningful story and experience that links what people have seen with what they do. It’s not enough just to give them something to look at. It’s as meaningless in branding terms as a carrot, a jumping trout or just another pretty logo. Badges aren’t brands.

Of course Wellington’s already done a lot more than just underwear-draping with a gorilla. In fact, as the whole world knows, the revamped King Kong beat the dinosaur, defended the girl and still had time at the end to scale the building.

Clearly another primate thing isn’t going to cut it. Not in this day and age.

So instead, someone simply suggests erecting a large white sign on a hill.

That gets attention. Facebook goes mental. There are demonstrations, media stories, outrage, traffic jams, comments, derisions, mentions of civil disobedience, and even offers of prizes to bring the wretched edifice down …

That was easy. And it may well be just as easy to get the momentary attention of people flying into the city. “Look, a sign. Ha, ha”

But then what? How does this sign connect with what people come to Wellington to experience? What does it add or inform beyond that moment of attention?

That to me is the real issue here. And I’m hoping that’s what this Wellywood sign proposal is – a way of getting people to pay attention and focus on how Wellington could use such a prime piece of real estate to extend its story. If that’s the real intention, then Wellywood’s certainly done its job.

If not, and this really is as far as it goes – banana, anyone?

Be happy

Not the best of days yesterday. Put my back out, and retired to a lie-flat position. Brain racing, body stopped … Aaaargh. To pass the time, I mused on getting my understanding of the purposes of business and branding down to their most basic forms. It led me here:

What if the purpose of business, particularly a service business, is as simple as this: to make people happy. Imagine if that was the metric for your product design, your standards, your customer service, your innovation programme, your culture, your brand, your competitiveness.

And what if the purpose of branding is to let people know how you intend to make them happy.

Here come the objections: most of them variations of ‘we do that already’. No you probably don’t. If you did, you wouldn’t have effective competitors, you wouldn’t struggle to maintain market share, you wouldn’t find yourself locked in a pricing war. Perhaps you think they’re happy or hope they’re happy, or you word your customer satisfaction surveys so that you can tell yourself they’re happy.

Look a little harder. You’ll probably find they’re not.

Now imagine if everything else we normally mull over was inversed. Instead of the KPIs being how we measured success, those operational metrics became an indication of how happy people felt working with us, buying from us, trusting us. In other words, imagine using the numbers to quantify the success of achieving the emotion rather than generating an emotion based on the success of the numbers.

Of course you’d need parameters. Not everyone can be happy all the time. Not everything we do in business is happy. And happy itself is hard to define. Legal would have a field-day. Finance would agree that the whole place had gone to the dogs. But if your goal every day was to make people happy, your organisation might be a little more empathetic, helpful, friendly, engaging, inclusive, tolerant, involved, human, generous, optimistic … which aren’t bad qualities.

Imagine replacing your marketing strategy with a happiness strategy. OK, ignore the term please and focus on the outcomes. That might make your customer service policies a little less myopic and your new business pitch a little less about what you want to say and more about what your customers would enjoy seeing. You’d look for ways to delight, charm and pleasantly surprise in your dealings … again, not bad qualities.

Now quantify how much churn you’d save, productivity you’d gain, commitment you’d garner if your people were happier.

Maybe it is simplistic. But sometimes the barest questions really do come with the greatest cut-through.

Imagine if every marketing manager asked “Would I be happy to see this?” before they signed off the next campaign. Wow. That’s around 90% of most ad breaks gone.

The effect on Oprah?

We’ve all seen what the Oprah-effect has done for others. Now it will be interesting to see the effect of change on the O-brand itself. By changing the formula, how much does she risk tampering with the magic? Will another talk-show rise to fill the afternoon gap, or will the 40 million O-army decamp and migrate en-masse? Is that even possible?

How much do the dynamics of a brand fundamentally change when you quite literally shift the channel in which it is seen?

Waiting for the uplift

I once had a flatmate who was a pilot. He used to fly these ridiculously small planes in and out of crazy airstrips throughout Papua New Guinea. Every take-off, he used to tell me, was almost literally a leap of faith. You barrelled down a ramshackle runway in the middle of the mountains, literally fell off the end and waited for the winds to pick you up.

He used to come home from an assignment, throw his bags on the couch, and announce, “So far, so good”.

For some reason, I thought about Simon today as I read this article about the fall of Martha Stewart Omnimedia (MSO). What a long way down. In 2005, Martha Stewart’s publicly listed company was worth north of $1.8 billion. Since then, the stock has plummeted a whopping 88%. Now it looks like it may be up for sale – maybe even revert to private ownership – at a fraction of its peak worth. Sure, they’ve been some contributing factors to that – conviction for Stewart herself and of course the small inconvenience we all know as the GFC – still, that’s one hell of a fall from grace. A fall that, according to one analyst quoted in this article has left the company “undersized, underfollowed and undervalued”.

Moral of the story? There are probably several. But let’s focus on one: the myth of the sustainable brand. Sustainable in the sense that it is perceived as self-perpetuating and self-sufficient. Capable of continuing to run on its own. Endlessly.

But strategy, as the great Vijay Govindarajan reminds us, is not a set-and-forget exercise. On the contrary, as the Professor has tenaciously and convincingly argued, your strategy starts dying in terms of its effectiveness the moment it is created. The initial lift-off does not last.

Observes Malcolm Polley, chief investment officer at Stewart Capital, “Martha Stewart is a textbook example of what can go wrong with an entrepreneurial company … Martha Stewart’s company is undergoing a slow death that is a result of management failing to make a transition to the next generation.”

The article seems to imply that the company has been hamstrung at least to some extent by having a key investor who holds more than 90% of the voting power but who is expressly prohibited from joining the board until the third quarter this year. Perhaps the company has had no choice but to run ‘business as usual’ because of that. If so, the alarming dive in the company’s value would appear to support Govindarajan’s point.

My own view is that brands need an iterative strategy – one that addresses Govindarajan’s theory by ensuring that they shed or at least reduce their reliance on hero lines once they start to commoditise and continue prospecting for new ways to replace them. The key it seems to me is to ensure that those incoming lines fit with the brand and its storyline without simply repeating what is being replaced. (Hey, no-one said it was easy.)

It’s a reminder too that the whole point of profit is not just to reward shareholders for their faith and patience, it’s also to fund that prospecting process. The only brand that you can sustain, in other words, is one that you continue to refresh, or at the very least review. Every brand needs continuing attention. And continuing attention requires a running motor. A motor fuelled by cash.

It always amazes me the number of companies that seem to believe they will be the ones to defy gravity. They’ll take the profits without reinvesting anything. Or they’ll keep running their brands to the very last drop without any replacements or refreshments in sight. And when their value and market share falls, they seem to do next to nothing new, perhaps more of the same … they talk about their history and their past achievements and they wait.

They wait for the uplift.

Here’s the thing. Any brand, no matter how strong it has been, without renewal, without invigoration, without powerful forward leadership … will eventually run out of air.

Every brand must dream

Positivity comes with benefits if this article on the optimism bias is anything to go by. While, collectively, our view of the future can swing in synch with the news, the budget or the crime stats, a 2007 study found that 76% of respondents were optimistic about the future for their own family. According to the author, “Even if that better future is often an illusion, optimism has clear benefits in the present. Hope keeps our minds at ease, lowers stress and improves physical health.”

It gives rise to phenomenon like talk of ‘green shoots’ in the midst of terrible financial depression because, it seems, we are compelled to find them.

The take-out for brands is obvious. Clearly, there is merit in espousing a clear and positive view of the way forward. It’s not enough to just inform. Brands need to inspire, because that optimistic prognosis of what lies ahead holds real opportunities in terms of engaging and involving people. It humanises brands.

Optimism, I surmise, also aligns directly with our worldview. In other words, what we look forward to is a world that is most like the world we believe in and want to live in. Politicians of course understand this instinctively. So, it’s interesting isn’t it, that so many brands deal in the present, without building a clear bridge to that tomorrow. They do so because their commercial imperatives tell them such containment is realistic – but in point of fact, perhaps articulating an optimistic future is an underpinning opportunity to cementing long-term loyalty.

To strategise, you must first dream. You must be prepared to go where your logical mind says you can’t, and, once you have, where your heart begs to stay. You must identify a brighter, stronger, clearer, competitively different tomorrow, and you must be prepared to brave the cynics to state what people secretly want to hear.

To do that, you need to know where that tomorrow needs to be – even before they do.

As one of my favourite observations goes – imagine where history might have taken us if Martin Luther King had stood in front of all those people in Washington and announced “I have a Powerpoint”.

9 lessons planking can teach brands

1. Sometimes, there’s just no way of knowing why something becomes a phenomenon. But momentum is addictive – once an idea takes hold, it assumes a life of its own. After a time, it is because it is. The power of an idea is not in actually in the creation, it’s in the radiation and the subsequent take-up.

2. Remember though that a global idea can still be an idea going nowhere. It can be just one more thing to wile away a moment. The numbers can be impressive, but they don’t always point to something meaningful. A million downloads is often a million free clicks. That’s not the basis for a business model.

3. Life is most powerful, and perhaps becomes most alive, when it is visual. Powerful images move us to laugh, share and try. Give people amazing things to look at, and they will literally stop and do so.

4. Posts are the new fingerprints. Give people a simple but fun way to participate in something, especially one they can easily record and share on their social networks, and they will take to the idea with gusto. It’s their chance to put their mark on the world in the moment.

5. In the right setting, weird is a competitive dynamic. People can, and will, seek to outdo each other over the strangest things. One person’s extreme is another person’s starting point. Up the ante, but please, do it responsibly.

6. Andy Warhol was right – and wrong. Everyone will be famous, potentially – but probably for seconds rather than minutes. Shorten the time to get to your story. As the social network continues to expand, I have no doubt that the six degrees of separation will be replaced by six clicks.

7. The thirst for the new can be cynical – people can push the ridiculous just for the sake of it, just to see what happens. Equally, they can promote an opinion or take a swipe, just for the hell of it. Understand your reputation management in that light.

8. Official disapproval is a huge incentive, especially when it’s accompanied by media coverage laced with enticing terms like danger, stupidity and recklessness. Sometimes you want the politicians and the authorities tutting what you do. It might just make you more credible.

9. The search for excitement is unrelenting. Equally, in a word beset by pressures, there can be something unrealistically interesting about the inane. People say they have no time to pay attention to anything, but they are always on the hunt for something interesting to do, however fleeting, that allows them to escape the daily grind. Look for the contrast opportunities.

Would you be a fan?

What would you do with your company’s mission statement? Would you tweet it?, Brian Solis asks in this article. Just as importantly – would you retweet it?

In other words, does it carry enough meaning for you, and is it personal enough to what you strive in life for that you would literally want to put your name to it and circulate it?

I love this thought because it’s a great reminder to all of us that purpose isn’t about what you’re told to do, or believe or say. It’s about what you choose to share with others. Or at least it should be.

The “BBQ script”, “elevator speech”, “picket fence précis” whatever you want to call it can’t just be a set of words that you roll out on cue. It can’t just be marketing. Not if you really want people to believe you, and therefore the brand you represent.

Speaking of belief, let me ask you this. How much of what you talked about, thought about, met over, reviewed, presented, rationalised, advocated, defended, instructed, created, delegated yesterday … would you “Like” if you were given the chance? How much of it would you be proud to say you were proud of?

Or did it just get done?

Because if you’re not a fan of what you do, if you wouldn’t like it – why should anyone else?

 

Reaching the limits of conversation

Reach is one thing. Notice, and more particularly trust, are quite another. Yesterday Alex gently challenged me over my assertion that six degrees of separation will soon be replaced by six clicks. Her point – and it’s a very important one – is that there is a marked difference in loyalty between degrees and clicks of separation because we generally build stronger bonds face to face than we do online, and the strength of those bonds will extend further into our networks.

Six clicks, she believes, is just too many. Alex’s view is that much after two clicks, the network is already so wide and the bonds of engagement so unsupported that people simply drop off our radar. We don’t take it any further. There is a limit to the familiarity we can, and probably choose to, leverage, and it occurs at a much earlier point than in the physical world.

In the physical world, knowing someone who knows someone who knows someone who knows someone who knows someone who knows someone is intriguing and bonding. It spurs conversation. It forges links and connection. There is an element of discovery. We have centuries-old social signals that we can rely on to probe for sincerity and credibility.

But the fact that anyone can seem to reach us from anywhere is heightened online. We trust more slowly and rely on greater familiarity to let people in – which is ironical in itself. In a world where accessibility has never been greater, we have a flat earth approach to contacts – we will only venture so far from who we know before we fear, or refuse to acknowledge, what may lie ahead.

This thought implies there is, ultimately, a finite settling point for a social network – a point where the network itself is saturated and further introductions are not welcome, even though theoretically they could go a lot further. No-one’s suggesting we’re anywhere near that point yet, but it would make an interesting anthropological study would it not?

How far does your trust extend in the real world vs the online world? How many clicks would it take for you to reach your discomfort zone?

What’s new about what your customers already know?

Most brands get launch. They understand how to make a splash for a product on a day. But what do you do between splashes? How do you keep front-of-mind? And more importantly, how do you stop the inevitable awareness fade as the ripples from your big splash die away? If you’re Walt Disney, you start introducing shorts between your new features, just to keep up awareness of your most popular and lucrative characters. And you do so knowing that such a cue will reactivate interest and re-kick merchandise sales.

Cross-referencing in order to cross-sell. Nothing new in that – except that here it’s happening at a launch. When Disney releases Cars 2 later this month, audiences will be reintroduced to the key characters from Toy Story in a six-minute short. As Albie Hecht observes in this article in BusinessWeek, “It’s a way to extend the characters and the brand without its fans waiting two or three years for a new movie.”

There’s a lesson here.

It’s tempting for brands to think of their products as separate offerings within an overall branding portfolio. They co-ordinate launches to work alongside one another. But what Disney’s strategy shows is how simple and cost-effective it is to provide customers with added-value experiences based on other brands in the stable that they already know and to use these to maintain relevance and top-of-mind between launches without cannibalising on new offers. All Disney have essentially done is take a format that everyone knows – the movie short – and to elaborate it into an enter-mercial (my new term for a short-movie length commercial that entertains).

Just as interesting is where this development might point other brands.

Increasingly, my sense is that brands will need to look at running longer storylines; stories that they interweave throughout their portfolios at varying degrees of emphasis and that they reintroduce to customers at opportune moments. Cross-referencing and in-jokes pull people in, get them engaged and generate a very real sense of inclusion that heightens the experience. The secret, as Disney have seen, is to make the ‘guest appearance’ significant enough for people to notice without it overshadowing the main event. Six minutes is long enough to do that.

I perceive such appearances as powerful by-the-way opportunities – with the major advantage of course being that they already come pre-packed with familiarity, loyalty and intrigue. New can be exciting. But sometimes, learning what’s new about something customers think they already know can be mighty effective.

Perhaps the new question as you plan your next brand launch is ‘what can we leverage?’

 

New notes on my keynotes

Just revised the notes on my keynotes. Take a look.

How to create strong signals

Spotted this article in The Economist on the growing cost of thought leadership. In an escalating battle for top-of-mind, the top consultancy brands it seems are prepared to spend large amounts – up to 5% of gross revenues by one estimate – to produce thinking they then give away for free.

The activity shows no sign of slowing down in these recessionary times, with spending on such papers up by 500% according to one estimate, yet ironically the very consultancies that hammer their clients on the need for accountability can ascribe very little hard data – at least publicly – on the return on the investment.

So why do it?

My sense is that this really is a battle fought around something my friend and colleague Alex calls “strength of signal”. Much of the thinking about that is fairly obvious in a B2C market, but how do you generate ‘strong signals’ in the B2B market where the big consultancies are competing? I subscribe to more than my fair share of such papers. So what follows are the ten components that I think create the strongest signals in a B2B market crowded with corridor walkers.

The ten things that make thought pieces worth reading (and therefore help build professional brands):

1. Authenticity – they reveal a genuine interest in, and knowledge of, the area, its importance and its implications. In an era where so many consultancies seem to run revenue drag nets hoping to snare billings in every area imaginable, this is a great way to exhibit genuine expertise

2. Innovation – they show a consultancy looking to break new ground or at the very least champion a broader awareness than the conventional viewpoints. That aligns not just with senior decision makers’ search for new competitive opportunities, it also sends a subliminal message of a consultancy committed to, and capable of, looking beyond the ordinary.

3. Authority – by taking a prominent position in the thinking around the subject, the consultancy establishes credibility and at least looks to make the ‘go-to’ shortlist for that issue, and problems that appear, or feel, similar. A business that lives by its brains must be prepared to preview its brains in action.

4. Familiarity – they reveal a working knowledge not just a theoretical understanding of the dynamics of the industry/sector. This is critical, because it implies all-important experience.

5. Consistency – there should be clear line of sight between what the consultancy talks about and what it espouses philosophically. In other words, anyone reading such material should see it as a natural space for the consultancy to be in.

6. Leadership – because of all the above, the consultancy should feel like the natural leader for initiatives in this area – not just the company that people come to by chance, but the one they look to for assertions of change and measures of success

7. Urgency – the business case for considering or acting upon this in a shortened timeframe is vital. In a world where distractions loom large and agendas loom larger, getting an idea on the mind-map of senior teams is never easy. Strong signals make for a compelling business case. They provide a reason to pick up a phone, clear a hole in the calendar and say ‘we should talk’.

8. Distinction – the thinking must be new. I counselled a consultancy recently that wanted to release a paper based on everything they had searched. There was nothing wrong with what they had found, it’s just that it completely lacked authorship, and therefore ownership. It told me what everyone else was thinking, which, actually, diminished the role of the consultancy. They literally couldn’t put their name to it. I asked them to bring me back a point of view.

9. Objectivity – it can’t just feel like another pitch, and in that sense many of the dynamics that apply to social media (giving generously in order to drive up fans and followers) absolutely apply. At the same time though, it can’t be so divorced from the consultancy paying for it that the alignment is lost.

10. Name – the thinking should be framed to a term that the consultancy wants to take ownership of. This needs to be a snappy but credible name that sits easily with the consultancy brand.

 

Shapeshifting how your customers feel

I was at a speakers’ function once when the conversation turned to those who make the big dollars on the podium. Referring to one particular keynoter who charges around $100K for an address, one of the people in the group observed, “That’s $1700 every minute they’re onstage.”

Are they worth it?

It would be an interesting exercise wouldn’t it to pause a video of such a presentation every 60 seconds and ask ‘was that worth $1700?’ because I suspect that not every minute is worth the same amount. I suspect there’s some variation of a flight of stairs of value, with relatively little ‘value’ at the beginning while everyone settles in and the speaker introduces themselves, a building and paced period of value-delivery in the middle as they extrapolate a story, and then a sustained and high value end-game where they leave the audience inspired before exiting.

Skilled speakers are experts at pacing their presentations to deliver that shape of experience. With so much at stake over such a condensed period of time, they have to. It’s a lesson more brands could learn from – pacing the delivery of their experience to offer critical value at critical moments.

So many brands don’t of course. They flat-line. Or they climb and dive. Or they fish-line (quick spike up, followed by long slow decline over an extended period. Draw it, you’ll see what I mean.) And the reason is that they don’t put conscious thought into their brand experiences. They don’t design them to deliver emotive out-takes. If they design them at all, they do so logistically to deliver a product or service which they hope will produce an emotive out-take.

Try this simple exercise some time.
1. Plot the shape and duration of how you want customers to feel over the course of an interaction. In particular, what moments of the transaction need to be real highs.
2. Ask your frontline staff to map the shape that they believe summarises how customers react across that timeframe now.
3. Work through what you would need to deliver your customer at each point of that experience in order to lift how they feel at critical moments.

It’s a revealing process. One man, asked to draw steps 1 and 2, drew two parallel lines right across the whiteboard.

“See the top line,” he said with a smirk, “that’s what we want to deliver.”

And the bottom?

“That’s what we actually deliver. It’s a parallel universe.”

Hey you, get onto my cloud

You could see iCloud as Apple’s long-awaited move into the cloud – a response at last to what Amazon and Google have been doing in this space. But to my mind, from a brand point of view, iCloud supersedes because it once again joins the dots, and in so doing it both ring-fences and reinforces the Apple ecosystem.

One of the many things that Apple can teach others about branding is how consistently and persistently they link everything they do back to their purpose. While others continue to market features, Apple presents what it does as steps in the Apple journey. And with the proliferation of devices over the years, they have essentially created more on-ramps at more and more price points for people to join them on the road.

Syncing via the cloud not only makes sense of that proliferation of devices, it deftly sets the stage to reduce the desktop to another one of those gadgets. There’s a clear agenda here, from a brand point of view, to flatten the hierarchy between the power of the desktop and the mobility of other devices. Democratising function allows Apple to compete on multiple fronts on its terms at the same time as it brings into fundamental question the reason why people would restrict themselves to just the desktop.

To me, the convenience factor of iCloud is less important than the addictive quality of convenience – Apple have given users more reasons not to look or source elsewhere, and presented this as something that benefits device owners. It hardly needs pointing out that it doesn’t do Apple any harm either.

Add Apps Store into this mix and iTunes and Apple is not inviting you into the cloud, it is specifically inviting you into their cloud. Painless access to music and a wonderful choice of apps await.

The device is beautiful and important – but it’s just the start. Via apps and music, the device itself gains personal value at the same time as it makes what Apple offers feel more indispensible

What continues to unfold here is an immensely powerful strategy: lowered emotive cost of entry for the consumer (with multiple entry points and strong incentives to sign in), continued rewards (via upgrades, apps and music), heightened barriers for competitors and a high pain point to leave.

My sense is that a ‘war of the worlds’ looms as the big ICT brands look to pull consumers further into their worlds and further away from the worlds of others. With Windows 8, Microsoft certainly appears to be heading towards a consolidated environment. Expect big responses from the likes of Google/Android and Facebook.

The 7Rs of a great brand strategy

A great brand strategy combines what Adrienne used to call ‘the logic and the magic’ – that mix of rational and emotive elements that, together, combine to give a brand engagement, connectedness and distinction.

I talk a lot these days about needing to position a brand beyond reasonable doubt – and by that I mean looking for brand performance and potential on more than just logical grounds; positioning it in such a way that it ‘calls’ to customers rather than just rationalising itself to them.

To do that, there are always 7 factors I look for in a brand strategy. The 7R’s …

1. Resonance – how will people react? Brands need to elicit an emotive reaction. So what’s the emotion that’s being generated here and how intense is it? Does it talk to people’s needs in ways that feel personal, relevant and wonderful?

2. Resilience – how strong is the strategy competitively? Does this really give the competition something to ponder and react to? Does it front-foot them in the marketplace? If not, it’s wallpaper. Just as importantly, for recovering brands, does it mark a clear way back and a strong way forward?

3. Results – what difference will it make? How will it change the bottom line, contribute to the business strategy, earn its keep? Is it going to make its numbers? And if it doesn’t make those numbers initially, where’s the Plan B in the strategy to fix that?

4. Resolution – how will the new strategy galvanise people from the inside-out? Is it inspiring? Does it align with the vision and the purpose? Does it bring focus and substantiation to the conversations taking place internally? Does it squarely and fairly say “We heard you” to internal stakeholders who were consulted? Does it give permission?

5. Radiation – will it spread? Are the ideas in this strategy capable of great take-up? Will they get people talking? Will they move the brand beyond the confines of where it now finds itself? Is there a story embedded within the strategy that people will really want to hear.

6. Redefinition – is it radical? Does it have stretch? Will it make people sweat (in a good way)? Is it disruptive enough to reset the competitive markers? Or is it just rearranging the deckchairs? What nuances does it unearth? What new angles about the business does it cover? How exuberantly does it challenge the status quo?

7. Recognition – does it still have the brand’s DNA? Despite everything that’s being proposed, everything that’s being challenged, does it still feel like an iteration of the brand customers know? Is there enough here for them to recognise and enough here for them to get excited? It may be an extension or an expansion, a shift or a reinforcement but the connection points still need to be there and the departure absolutely needs to go to a better place for customers (which means there’s still clear comparison points with what it was).

Paying less and less, getting less and less

The response by airlines to customers’ demands for lower and lower fares has been to do exactly that, lower seat costs, but at the same time to strip more and more of what is included in the fare out of the price.

This process – referred to by Time as “the unbundled skies” – points to a business model that I see becoming more prevalent, and not just in the heavens, as price-sensitive brands lower entry points in order to get customers to commit, and then use “upgrades” to restore margin and, according to the article, add another 50% or so to the real price. Pay less, get less. Want more? Pay more. Ryanair have even suggested, somewhat controversially, that “more” could include access to the toilet. In fact, according to one consultant quoted, there are up to 35 add-ons available when you fly, ranging from baggage and food fees to flight-delay insurance and keeping the middle seat empty. You literally get what you pay for.

This seems like an expedient answer to customers’ demands for cheaper goods. Lure them in – then trick them into paying more. It’s not exactly customer-friendly but at least, some would argue, it’s a way to compete.

True, but changing the competitive model this way is not without its consequences. One is that as the product itself becomes less valuable and valued, service now comes not just at, but with, a price. That in turn shifts the emphasis from what customers get to what do they not get, and what shortfalls they are prepared to do without.

For the moment what’s happening in the aviation sector amounts potentially to a complete economic rebalance of the product at that end of the market. As the article points out, “In the unbundled world, airfare is merely the price of admission to get on a jet. If you crave comfort, convenience, less stress, decent food — what was once called good service — expect to pay up.”

In time, the service itself, not the seat, will become the real competition point, as customers look to ‘build their own flights’ made up of base product and services that they are prepared to ‘add to cart’. Staff meantime will find themselves being judged on their ability to up- and cross-sell services in order to make targets.

We shouldn’t be surprised. As sectors continue to fill with competitors, radicalisation of branded business models is inevitable, with all-included at one end of the market and not-included at the other, and increasingly little between them.

While the model has far wider applicability than the airline industry, the dilemma for brands in such a scenario is that when you uncouple what people get from how you want people to feel, you reduce every part of the experience to a transaction, and every element of loyalty to the same level.

Everything becomes “do I or don’t I?”

As to where this might go, well that seems fairly predictable too. As the fight for seats gives way to loss leader seat strategy, and a squabble over a la carte services and the quality and profitability of those services, medium-term we’ll probably see airlines respond by using a mix of lower fares, bundled services and loyalty incentives to adjust and respond to value perceptions.

 

The alternative to free

Regular readers will know that I have a major problem with the free model. To me, it’s misleading – and the reason why is that it’s based on a false premise: that if you offer goods for free, people will be in time upgrade to the paid model.

I see why people are tempted to go down this track. It’s easy to see free as a simple way to open the jaws of the funnel. Free gets you awareness and therefore volume, the thinking goes. And there is an implication given by some that you can then trust the conversion process to secure enough sales off that added volume to make the give-away worth it.

Easy too to believe, as you look around the social media environment, that with so many people giving away so much, you have little choice but to do the same.

The problem with this reasoning as I see it is that free is not a generator. On the contrary, it is a competitor. And the reason is that giving so much away sets up an expectation that more should be free. Free becomes a right, an entitlement. It actively competes with the willingness to pay.

Don’t get me wrong. I think there are things you can and should share without cost. You should share some thinking, for example, because there is a pay-off, if you do it well. Hubspot gives away lots of great content to entice you to trust them to at least trial their inbound marketing software. And as Seth Godin points out in this thought-provoking piece McKinsey’s consulting philosophy is free, it’s the bespoke work that costs money.

The problem is not that companies offer things for free, but rather what they give away in the pursuit of the freemium model. As Godin puts it, “There’s a growing disconnect between making something worthwhile and getting paid for it. The digital artifact is heading toward free faster and faster, and the inevitable leap to a paid version of the same item is going to get more difficult.”

His closing challenge, whilst directed specifically in his post at digital content, I think applies much more broadly to brands in almost every sector. “Now it’s up to us to wrap those items in such a way that they’re worth paying for again.”

Worth paying for again … That should be the real success metric brands make it their business to chase.

Becoming a cultrepreneur: the first 3 secrets

I coined the term ‘cultrepreneur’ some years back to describe enterprising business people who consciously set about developing brands that are anti-scale, hard to find and fervently followed – cults. A number of people have asked me how you go about building a cult brand. So here’s my first three secrets:

1. Make something amazing, and then make it unavailable. Alright, not completely unavailable. But part of the secret of growing a cult brand is to grow the legend, and part of growing the legend is to cultivate a myth of short supply. With a cult brand, you always want to be making just under the market demand. Enough to cover costs obviously, but too little for everyone to be able to get hold of it easily. The thought of missing out intensifies the pleasure of getting and the desire to procure.

2. Nail the long tail. Cult brands appeal to those who think they know better about a particular subject, and who want more than what is widely available. The secret is in the discovery. So that’s about two things. First of all a product line that’s far enough off the beaten track to appeal to collectors rather than consumers. And secondly, something that takes some finding. That search for something special starts with a mention, a hint, a throw-away remark or endorsement – and that reference kicks off a journey that could end in a garage sale, a bar 400 miles away or at a club in the down-beat part of town. Cultrepreneurs are masters at leaving bread-crumbs for a journey that a passionate few will take. The challenges of course lie in where the crumbs are left and creating a journey that is enticing enough to persevere with.

3. Deliver what’s missing. Sometimes that’s about sheer quality, or a particular quality. It could be authenticity (in a market where everyone else is just putting up an appearance). It could be an irreverent attitude or just plain rudeness (in a market filled with stuffed shirts). It could be humour. It might be availability or recognition. Whatever it is, it isn’t seen by some as being there now, and there are enough people who want it, or who would want it, to inspire a cultrepreneur to make it happen. Almost inevitably, a cult brand is edgy, polarising and unafraid to fray a few nerves. Protest and outrage often act as fuel, and persistence, especially when greeted with derision by those regarded as the status quo, is read by brand followers as a sure sign of deep conviction. There’s a real skill in pushing that outrage far enough to keep it interesting without having it universally dismissed. Cultrepreneurs possess that sixth sense for being fashionably unfashionable.

Conversation vs recommendation

Nice piece from Neil Glassman draws a distinction that I think has escaped many of us between conversation and recommendation. As the author himself says, he thought of social media as a platform to directly scale up word of mouth (WOM) marketing. But the synergy that looks so obvious doesn’t happen. In fact, says Glassman, compared to the effectiveness of what takes place offline, surprisingly little WOM is generated on social media.

My sense is that while there is plenty of talk being pushed into the media, that content is then not, for the most part, being transmitted-on (or more specifically picked up) in the way that it is when WOM is in full flight.

Glassman himself hints at why. People, he says, participate in social media to interact with friends and like-minded strangers about things that interest them. Social media marketers, on the other hand, engage with their customers hoping to encourage them to spread the word. The first interaction pivots on “us” – about the things that “we” share, which means ownership exists. The second is about turning “mine” into “yours”. It’s about encouraging people to take ownership.

Glassman continues, “It appears that as much as social media has changed our networked world, it hosts only a small bit of the conversations about brands, products and companies. Not what social media marketers talking amongst themselves would expect.”

One observation on the difference between WOM and social media did surprise me. While 20% of WOM conversations are triggered by media/marketing, half of all conversations about brands have references to media/marketing, and positive experiences trigger more WOM than negative.

We share what we enjoy – no surprises there. But we share what we enjoy most effectively when it has affected us personally. In other words, we convert mere talk into active endorsement when we have emotional skin in the game. By contrast, Glassman observes, most people on social media networks are passive. They’re talking, passing time.

The key aim for people engaged in social media is bonding and the subject matters they discuss are just part of the conversation. This may make them less inclined to endorse a product or an idea. By contrast, WOM focuses on shared subject matters because people talk about they have in common, so they are much more likely to recommend something that they think the other person would like.

Key message for brands: until people see your brand as part of their world, they may talk about you but they are less likely to recommend you than most marketers would like to imagine.

 

Two very different types of stickiness

I love this distinction by Martin Bishop between the brands we’re stuck on versus the one we’re stuck with. Brands we’re stuck on captivate us. Brands we’re stuck with hold us captive. As Bishop points out, “Consumers may be loyal to both types of brands if loyalty is simply measured in terms of repeat business but their feelings about the two types brands [are] very different.”

Brands we are stuck on reward us emotionally through the relationship we have with them. We are loyal to them, and our relationship is expressed through repeat business. Brands we are stuck with are there strictly for functional compliance – because we feel we have no choice but to have a relationship with them, or with someone equally as unattractive. And we engage with them as much as we have to, but only to that point.

The difficulty for brand owners is that the metrics for these two very different levels of “loyalty” can look very much the same: low churn; repeat purchase; consistent revenue. The difference lies in how the customers themselves feel, and whether they openly express that or not. And the litmus test for such loyalty is when a viable and competitive alternative offer hits the market. Those who are stuck on the brand may notice it but consciously choose to stay away. Those who feel stuck may well decide not to stick it out any longer or at the very least to look to escape at the first opportunity.

The stuck-on business model is hard work. It takes commitment and responsiveness, inventiveness and a genuine wish to do good by those who are loyal to you. That can be time-consuming and tiring, but very rewarding. The problem with the stuck-with is that it’s a bit like a Ponzi scheme. It works for a while and the returns are good … as long as you can keep feeding people in the top of the funnel. But social connectedness now means that the viability of doing that at a sustainable rate is diminishing.

Loyalty may look much the same in the numbers (for a time at least), but it feels very, very different on the ground.

An option or a choice?

Just getting a presence in most markets can be hard work. One of my friends is finding that in the beverages game – a longer runway than he and his partners expected, and a lot more patience required as well. Long days, he says, having to justify every metre of shelf space you’re allocated.

Same with being a speaker or a consultant. But doing all the work to get on the map just elevates you to the status of another option.

That’s not the same as being a choice.

Options form part of the line-up for how customers decide. Choices are a conscious decision in themselves. Option means you’re available, you’re on the list, in the books. You’re a speculation. Choice makes you an active decision, one part of yes/no, either/or. You’re known, you’re quantified, you’re considered.

Now if you’re in the business of selling variety – like supermarkets, book stores, speakers’ bureaux, search engines – options fill out the stock book. They reflect well on you because they prove that you can tap the market. They give you a long tail. And they give your clients the sense that they have the full pick of what’s available. Chances are, for that reason, if you’re in the business of selling variety, you welcome options (or at least the best options) with open arms.

Being the option isn’t quite so glamorous. It may have boosted your ego to have made it past reception, but if you just stay an option, frankly, you’re making up the numbers. And it’s easy to forget that, in order for the market to continue to work efficiently, for every brand that becomes a choice, so many more must either become or stay options.

Today’s marketing environment has tricked many brands into believing they are contenders. They post a website, they get traffic, they’re making their metrics. To them, they’re a choice.

But until that traffic monetises or that shelf placement improves, or the call volumes really lift, they’re more likely to be an option.

The thing is, most times you don’t get to decide your status. Customers decide – based to some degree on what distributors decide, agents decide, the media believe you will be worth to them. Fundamentally, the shift from option to choice isn’t based on attention, luck or talent alone. It’s based on consciously shifting influencers’ perceptions – of your value and your potential value.

New keynote: Taking the cannibals out for lunch

Just added new notes about my keynote “Taking the cannibals out for lunch” here

Now on Alltop

This feed has just been added to Alltop – here and here.  Nice.

When was the last time you actually changed your mind?

The hardest thing a brand can do is convince – to go against what people already believe and to ask them to believe something different. Actually, that’s not just true for brands, it’s applicable to anything or anyone. In the scheme of natural human interactions, conversion is relatively rare. To succeed at convincing, you need to overcome all the natural resistance that comes with encountering something new. Essentially, you need to break down all the inclination that has already amassed for an idea or a storyline. You need to destroy the loyalty that already exists for what people have and replace its equity. That’s amazingly difficult. As Seth Godin once observed, “If the story of your marketing requires the prospect to abandon a previously believed story, you have a lot of work to do.”

Redirection is simpler. You change soaps. You change airlines. You change shirt brands. Particularly if soap, airlines and shirt brands don’t mean that much to you. Changing from a brand that says and does one thing to another brand that seems to say and do the same thing under a different name is easy. That’s why and how things commoditise. When we see no difference between them, when changing makes no difference for us, because it doesn’t represent a change to our core belief system, we can do it without hesitation. Add in a good price, and we’re gone.

The irony is that as consumers, we all say we welcome change. We don’t really. What we really welcome is improvements, additions or extensions. And we have strong preferences and priorities. Some things, packaged in some ways, appeal to us more than others – but only if those elements conform with our worldview. A dispositionalist would explain this by saying that as humans we are significantly, if not completely, influenced by the cache of beliefs that we run behind the scenes and that subconsciously decide huge amounts of what we agree with and disagree with every day.

Marketers are optimists. We naturally believe that the power of a strong, well-presented argument must win through. It’s simply not true.

The easiest thing a brand can do is confirm – to give us more, by way of physical product or perspectives, of what we already know and agree with. Loyalty jumps when brands tell their customers, show them, present them with something they had always wanted to hear, see or think about. Launching iCloud recently, Steve Jobs told Apple fans the world was entering a post-PC age. It was an idea that was readily and speedily embraced, because it confirmed what Apple fans believe, or would like to believe, anyway.

Marketing may help decide preference but it cannot alter fundamental inclination. On the contrary, inclination pre-decides the success of so much marketing.

Headgames

I love this observation by Jay Deragon about the Social Learning Curve: “All things social are creating a herd of copycats following practices, methods and behavio[u]r created by the frenzy of learning something new …”

To what end? is the inevitable question.

Once learned, something is no longer new. In fact, it retains distinctive value only whilst the numbers of people who have access to that knowledge remains small. And yet, thanks to all things social, the chances of that happening are becoming less and less. And the pressures to democratise what one knows are also increasing.

So everyone feels a pressure to learn, and many brands feel a pressure to share, but once accessed by many people, learning retains diminishing competitive advantage. It quite literally devolves to common knowledge. It becomes how ‘everyone’ does things, what ‘everyone’ agrees on, the way ‘everyone’ sees the world. Soon, what was new is basis.

The tipping point for example. Once breakthrough. Now mainstream.

Knowledge commoditises.

I happen to really like Collins’ book ‘Good to Great’, but if you believe that by reading it today somehow you will emerge with an understanding that presents you with a clear competitive advantage, you couldn’t be more wrong. Why? Simply because everyone you’re competing against has read it too. And between those readings, the reviews, the lectures and assignments at every business school across the world, and the many subsequent discussions, all the learnings are now widely circulated and applied. There is no secret to be had. ‘Hedgehogs’ are now relatively commonplace.

That dynamic puts so many brands in the knowledge business in three ways:

1. They must keep pace with the learning around them to avoid being left behind;
2. They must share new learnings publicly in order to make their brand more findable, to gain authority in the marketplace (ironically by making more and more people aware of, and accepting of, what they know), and to encourage others to feel that they should share their learnings too; and yet
3. Brands must retain and protect some learning, or some aspect of their learning, and continue to generate new learning or new variations of their cornerstone learning, in order to differentiate their brand from that of their competitors. Otherwise they too will become an also-ran.

Increasingly it seems to me brands must steer a knowledge course between three very different principles:

• Momentum: They must use knowledge to gain thought leadership status in their sector and to move customers’ and investors’ thinking forward to the point where it aligns with what they offer.
• Protection: They must take care not to be so open with their thinking that competitors gain the upper-hand or that customers feel they can do things themselves.
• Reaction: They must be prepared to react astutely and decisively as competitors choose to advance their own thinking in order to meet the insatiable demand of the market for new learning.

I liken this to trying to get anywhere by car in Rome during rush-hour: accelerator, brake, lane change …

 

How should we rethink the advertising industry?

I enjoy seeing people poke business models, but it’s important that when you look to disrupt a business that you do so without assumptions. The call by Marc Ruxin of Universal McCann to rethink the creative department of ad agencies is a great idea but my sense is that his suggestions still assume the battle is for attention, and that winning that attention and holding it via great content, well presented, is critical to achieving consumer preference.

The noise preventing that, he says, is formidable. Brands are trying to get their messages heard and acted upon in an environment of 150 million tweets a day, 700 billion minutes a month on Facebook, 300 million global players of Zynga games, 200 million Daily Deal subscribers …

I’m far from convinced though that attention and preference are a linear progression. And I think we need to insert at least three further filters into that zig-zag of decision making: notice, consider and purchase. You may gain a consumer’s attention momentarily, but until they choose to escalate that attention and actually take notice of you, there’s no way they’re going to consider you, never mind prefer you – and even then, they may not buy.

It seems to me Mr Ruxin is still trying to run an interruption model based on see, want, get. I feel he still thinks content is the make or break, and he’s now looking to adapt that model to fit the new channels that consumers now occupy their time with. That doesn’t so much require a rethink of the creative department as it requires the creative and media departments to rethink their approach and to adopt new skills. Not quite the same thing.

In his article, the author suggests: “It is a new world: Brands + Skillfully Placed Media Investments + The Right Platforms + The Right Partner + The Right Offer = Creative Success” Two things about that. I don’t think that’s a new world at all. That equation doesn’t look any different from the way it looked when I started in advertising – it’s just that the media, platforms and partners themselves have changed. And there’s no reason to believe that ‘Creative Success’ is the result anyone should be seeking anyway. That’s an agency metric, not a commercial one.

I absolutely agree with Mr Ruxin though that we need to be having this discussion, and I sincerely mean what I say here to be taken as dialogue not refutation. So, rather than just being negative about a call for change, let me give my own perspectives on what needs to run, and I think for the most part is happening, inside the agency world. It’s not a definitive list by any means, but hopefully it hints at where the model might go, philosophically at least:

1. It’s not what brands do for people that matters, it’s what people feel they can do with brands. The dynamics of the brand-consumer relationship have almost completely reversed. Consumers identify with brands because they see them as an expression, and perhaps an extension, of their own views. Tricking the consumer, catching them out, interrupting them … these are all outmoded ideas. Increasingly I think it’s just an expectation on behalf of consumers that brands will be where consumers expect them to be.

2. The creative process is no longer just about what you create, it’s about what you start, inspire and encourage. The creative product itself is only as important as its catalytic effect. If it doesn’t work, it has no value.

3. It’s not just about how much attention you get, it’s about how much uptake you get and how much product you shift – and keep shifting.

4. It’s not about platforms or environments, it’s about encounters, and more particularly it’s about encounters that resonate with people. Resonance, not just presence, generates attention and more importantly, engagement, interest and desire. The platform or environment is the means for that, not the end.

5. Increasingly a communications issue is the flash point for widespread thinking not the defining point for what needs to be considered. I completely agree that a wider range of people need to be involved in the creative process, but I also believe that the creative process needs to extend beyond the realm of preparing and sending messages. If you look at how companies like Ideo, Stone Yamashita or Fahrenheit grapple with a problem, it’s about way more than what is said.

6. Agencies are successfully making the move from advertising to communications to ideas. Now they need to make the radical move to answers. Ideas are wonderful, but that level of involvement alone is increasingly falling short of what’s required. My sense is that agencies need to continue to call on the thinking, disciplines and frameworks of their craft but to apply those to new scenarios. In my own case, whilst I freely admit that I struggle with the technical aspects of social media, for example, many of the ways one might draw on to engage and involve consumers are straight out of the direct marketing playbook – they just need to be adapted for new dynamics and expectations.

Finally, I am optimistic this will happen. Creative agencies have extraordinary experience in building brands. They have hugely talented people capable of achieving great outcomes. They absolutely need to draw on what they know, because there is huge value and insight in that experience – but they need to do so across a changing commercial and social plane. No one conversation will solve this … but at least a whole lot of people are talking. And that can only be a good thing.

Can brands fly?

Do you remember when you were a child the first time someone made you a paper plane? If your recollection is anything like mine, you couldn’t believe how it left your hand and made its way across the room. Before long though, it lost height and velocity, and fell to the floor.

One of my more cynical friends has this joke about how much media budget is needed to keep a brand going successfully: “Give me all the money you can burn and it will go like a rocket!”

It’s easy to see a brand as an expense that relies on getting attention to make its presence felt and to make the expenditure worth it. Detractors see it that way too. They’re very quick to opine that unless they’re constantly fed money to keep them in front of consumers, brands simply fizzle and fall to earth.

I don’t share that view. Particularly now, with all the different ways that we access and talk about brands, I see them less as rockets kept airborne by media schedules, and more as planes that need air flowing over their wings to help them maintain lift.

Those currents are made up of a number of elements that collectively generate value. They include:

• Perception
• Reputation
•  Distinction
•  Awareness
•  Relevance
•  Image
•  Loyalty
• Story
• Competitiveness
• Packaging
• Availability
• Offer

 

The currents work in different combinations and to different levels of intensity and effectiveness at various pricing and positioning points across every competitive sector. And when they are working well, brands maintain their elevation, even climb. The key point here is that success is not just about the money you spend on your brand, it is about the lift you generate and maintain through this combination of factors, some of which you control and some of which are beyond your control.

It also raises two aspects of market dynamics that help explain to me the need for an iterative brand strategy: market friction; and market gravity.

• Market friction – the levels of resistance your brand encounters in the marketplace. These are the forces that combine to make your brand fall short if it runs out of impulse. Most of these are generated by competitors, some by wider macro-economic factors, some by reputation

• Market gravity – there is a natural inclination for brands to fall. When currents diminish, stall or fail, it does not take long for brands to start to lose height. Some will lose prominence but continue on. Others will go into an arcing dive, at varying angle of acuteness, that may or may not lead to their demise. That’s why you cannot set and forget a brand, or assume success.

An iterative brand strategy, in fact an iterative business strategy, is about checking the ‘height’ of your brand relative to your competitors and to your history, and adjusting and responding to the volume and the dynamics of the currents passing across your brand.

Funnel vision

It’s always fascinating to compare how you see your place in the market with how others see you. Warren made this astute observation the other day. If you’re in a very small market like New Zealand and you look out, you see the whole world before you. There seem to be endless opportunities.

But step around to the other side of the world and look back, and you see a market like New Zealand from a completely different perspective. It seems small and hard to find.

The issue of course is not specific to place brands. It’s applicable to all brands that are small in comparison to the scaled markets they would like to reach. The brands themselves see a panorama. The world looking at all the choices available to them from so many sources discerns barely a speck.

This is quite literally ‘funnel vision’. Your perspective depends entirely on what end of the funnel you are looking from – the scaled end or the narrow end.

The only way that situation can change is when the brand at the narrow end finds ways to increase its profile and presence, so that it literally looms larger in the minds of those far away. Search can help do that. Partnerships and supply chains can also add proximity.

In the Southern Hemisphere, we talk a lot about the tyranny of distance. But in actual fact, the problems many of our brands face, like the problems small brands face in any scaled market, is the tyranny of profile.

What is not seen is not missed.

Take a moment

Coming home from Sydney, Paul and I were talking about ‘moments of truth’. One of the great ironies, and frustrations, for many brands is that reputation must be built over years, but can be lost in a tiny fraction of that time – seconds. All because of an action or a word, a misunderstanding or an expectation that may or may not even have been reasonable in the first place.

There’s always that apparent double timeframe between how long it takes to build a brand into an asset, and the experience-time within which many brands are judged.

Some people of course will see such a dichotomy as an exercise in futility – all that work, always at risk, capable of going with just a moment’s notice. But building brands is not a Sisyphean task. And here’s why. Loyalty is built in exactly the same way – in many of those very same moments across another very long timeframe. The decisions customers make to be loyal are often decided by criteria that occur in moments and that are as simple, small and whimsical as the decisions they make the other way.

That’s why for me, brands are no longer about big, clearly signposted “moments of truth” and much more about “moments”, or more particularly the truth in moments for a customer. And the success for a brand in each of those moments is decided by two things: the action taken; and the reaction it stimulates.

Different people working for different brands make different action decisions based on different criteria. Some decide intuitively on that moment’s notice. Some decide on process. Some decide on indifference. Some decide generously. Some decide consistently. Some decide surprisingly. Some decide reluctantly. Some ask you to make the decision for them.

With so many moments spread out across so many people over so many countries and so many channels on any given days, most brands would probably like each moment to exist where and as it happens. And for years it did. A bad moment, for example, extended as far as the customer who didn’t like an action, and to the network of friends that they talked about that moment with. Impulse created penalties or rewards, but they were reasonably contained.

The game-changer though has been social media – a channel made for, and perfectly timed in, moments. 140 characters long. A sound-byte wide. A “send” button away. It has changed the very dynamics around which moments themselves are judged. It has uncontained them.

People on the frontlines for brands are expected to make faster and faster decisions. Customers want answers. Now. But the consequences of those immediate decisions can continue to play out over much bigger vistas. Because in almost the time it takes to act, a customer can react. And the reactions generated in response to an action, any action, taken in the name of a brand can create ripples that extend as far as, often beyond, where the brand can see. They are visceral, uncensored, immediate … and cached forever. They can make your brand the talk of the world, or the recipient of some very bad feeling.

That in turn can have other far-reaching effects. Service is no longer just about what gets done. It’s no longer just accountable to what is delivered or when. Its success now pivots on what gets said as well as the result. Because that’s where the exponential effect really kicks in – good or bad. The sobering question each of us must keep asking ourselves, even as we cram more and more into every day, is “What happens when I do/say this?”

Moments have never had greater leverage. Or carried greater risk.

Joining the dots

Jeff Bullas’s piece on whether Google’s new Google+ marks an all-out war between Facebook and the search giant for dominance in social media raises some important issues. Bullas points to the demise in popularity of MySpace as a precedent for Google’s need to be concerned. From a technical point of view, I can see why Google+ can be perceived as an intervention in the social media space and as a challenge to the incumbent Facebook. But I think seeing it in that context alone risks missing the wider environment within which this struggle may well be taking place.

I’m not convinced that it’s about the fact that Google wants to necessarily get into the social media space. Rather, they may believe they have no choice but to have a presence – and a successful presence – there in order to defend their very business model. In other words, whilst this may look like another attempt to gain a foothold in an arena that Google has attempted to enter several times before, I see it being much more about Google absolutely having to get this right.

A key reason is the “war of the worlds” I spoke about a few posts back. We are now seeing a number of globally scaled brands building their platforms into ecosystems – Apple’s move into the cloud, Microsoft’s Azure project and Windows 8 initiatives, and Facebook’s Like strategy and its pending mobile developments. All of these developments signal a move to draw users into integrated, multi-purpose, branded environments where so many of each brand’s followers’ needs are catered for that they don’t need to look or source further afield.

Remember though that Google cannot easily search Facebook. That means Google is closed out of that search space. And if hundreds of millions of users cannot use Google within their favourite social media channel, they will look to Facebook to fulfil and potentially expand that function for them.

Couple that exclusivity with a fall in web-related searches generally and I think we’re closer to the real cause of Google’s alarm. Increasingly, people are searching for subjects, information and communities from within their favourite social media platforms. That signals that potentially the very way that we search is changing. And such a trend makes social media very relevant indeed to Google, because of course it represents a fundamental challenge to Google’s business model. Google either makes effective and substantive social media searching available themselves or risks being subsumed in a massive fall-off in web-related search numbers.

As Jeff Bulas concludes, “maybe [Google’s] long term existence and continuing relevance hinges on it becoming part of people’s social networks and not just a search engine.”

Part of the reason of course is that social networks by their very nature bring people together around subjects of interest and get them talking amongst themselves. In the process, they seek each other out, seek each other’s opinions, seek updates and news, and look for technical information and so much more from within their social communities. They are doing their own searching – but not with Google.

There is still that very real sense of mass. But it’s a sense of mass whose media physics continues to evolve.

Today, Facebook, Google, Twitter and Apple run pixellated empires – massive globally-scaled brands, huge and solid to look at from a distance, but on closer examination made up of millions and millions of individuals, who are in turn each talking about, connecting with and searching for what is special and important and precious to them within their favourite swirling media cloud.

In a little over ten years, we’ve moved from thinking dot-com was a business model to recognising that the business model of the future will probably pivot on how many dots there are and how those dots are joined.

Being liked: The danger of popularity for a brand

Wonderful, wonderful article by Neil Strauss on why we should all dislike the “Like” culture. Strauss maintains “Like” motivates us to compromise, to chase stupid metrics in a desperate search for acceptability. “There’s a growing cultural obsession with being blogged, digged, tweeted and liked,” Strauss observes, and it’s all about hitting the numbers, at the expense of having a distinctive point of view.

He has a point. Today’s buzzword – influence – is really all about cultivating a following – with the emphasis on cultivating. On the one hand, that’s a very positive thing. It brings people together, it generates and mobilises conversation. It has an outreach driver that is positive and convivial. It also provides real showcase opportunities to articulate individual expertise and authority in a subject matter, which can be important platforms if you’re looking to publish, speak or consult for example. But Strauss’s point is that, when our actions are influenced by our stats, and not the other way around, the search for approval becomes a straitjacket.

“Like culture is antithetical to the concept of self-esteem …” writes Strauss, “ … we are shaped by our stats, which include not just “likes” but the number of comments generated in response to what we write and the number of friends or followers we have.”

“Liked” is a false god – and it creates a false impression. It lures people into judging how true their thinking is and how valid their point of view is by what others say and how many of them say it.

The difficulty for brands looking to negotiate the social and indeed the wider marketing minefield is that cultivating a following – becoming and staying popular – really is core business. Without scaled approval at some level (even if they are cult brands), brands simply do not have the numbers to survive commercially. The dilemma is how to build enough personality and opinion into the brand to make it compelling whilst at the same time attracting enough people to the brand to ensure its viability; striking a balance between personality and popularity.

I speak often about the needs for brands to be magnetic: to draw people to them because of what they stand for, how they see the world, and the actions that they take. That’s very different from skewing everything you do to find the most common denominator – and that is clearly the gist of Neil Strauss’s concern.

For me, that’s why it’s so important to distinguish between liked and likeable. A brand that is “liked” is a brand people agree with – momentarily. A brand that is likeable is a brand people identify with. Following your “likes” is like valuing your company by watching your share price. Your esteem is totally at the behest of others, and in many ways beyond your control, highly volatile and easily driven off-course by what’s going on elsewhere.

Seeking to create a brand that is truly likeable is about bringing out the deeper qualities that customers see in your brand, that they are drawn to over the longer term and that actually come very easily to the brand because they are at the core of its ethos. A likeable brand is not necessarily top-of-mind all the time and is not necessarily the most popular – but for a customer or prospect looking to purchase, it is the most relevant and  the most engaging when it really matters.

A lot of that comes down to other simple things like how often people buy in that category. I’m not a car fanatic, for example, so I would only be looking at cars every few years. What the car brands would be hoping is not so much to have my attention all that time, but rather to gain my attention when I was in the market for a vehicle. That doesn’t mean of course that they don’t need to continue to engage with them – in this day and age, that’s almost a given – but the fact that they don’t necessarily make the top of my “like” list every day is no indicator of preference.

Purchases happen at the intersection of need/want, preference and availability In that sense “Like” is an indicator. Strauss reminds us though that it shouldn’t be the validator.

Who’s afraid of commitment?

Christine responds to my observations about the “war of the worlds” with an observation of her own that could well prove a dilemma in the making, although not an immediate one. As the big social media brands synergise and extend their offerings to make it more and more convenient to inhabit their brand of ego-system (hat-tip Brian Solis), when will it all become too much?

Is there a danger that it will all become too invasive? And even if it does come to feel that way, once things are that integrated, where’s the exit row?

Can you just buy a branded product anymore in that space without being drawn into a bigger commitment?

When does commitment become claustrophobic? When does convenience become imposition? When are customers being asked to buy into more than they want, even if what, or some of what, they are buying into is being offered to them free?

Perhaps that’s my real concern about Google+. It’s not about whether or not it’s better than Facebook, it’s about the fact that it seems to be so similar to Facebook, and to get the most out of it, there’s an increasing sense that I will need to decide to go with one or the other. To capitalise, I’m going to lock up even more with the Googlesphere or Apple or Facebook or Microsoft and therefore comply at some level with their rules and their worldview.

Choices are evolving into variations, and those variations are increasingly sequestered. Ironical isn’t it? More apps than ever, more ideas than ever, more information than ever … but as Wall Street continues to pile on the pressure for continued growth, how far will consumers let socialising brands go to capture value? At what point does a brand that means a lot to you become just too familiar, too knowing?

Don’t study their actions, study their habits

We get it so wrong don’t we? We develop ideas and look to see if they’ll work by intricately studying people’s actions and reactions. We poll them. We survey them. We sample them. We question them exhaustively. Whereas, what we should be doing, according to Dr Art Markman, is studying our customers’ habits and developing products and services that fit with how people want to behave.

That way, they’re already pre-disposed to take an action. After all, habits drive actions, not the other way around. All a brand has to do is encourage a new habit and tie the accompanying actions to their brand specifically.

Habits form, says Markman, whenever and wherever there is a consistent relationship between the world and an action. That means that “[U]nless you are in a business where you interact with each customer only once, your customers have habits related to their interactions with you.”

Strong brands capitalise on those routine behaviours. But to do so, says Markman, brands may need to change some habits of their own:

Stop asking and start observing – What people tell you they do, and what they actually do can be very different things, Markman says. If you really want to know how people behave, you need to watch what they do rather than listen to what they say they do. In other words, most brands need to get out more – into the marketplace, watching how people go about their lives, and figuring out how, where and when they can fit in.

Don’t break people’s habits for them. Customers form their own habits in how they interact with you. Know what they are. Itemise them. Understand the sequences that people follow, and why they do what they do. So many brands don’t do that. They look at demographics or SKUs.

Then, rather than introducing new concepts that force customers to change what they are used to doing, look at making changes that intensify their habits, or improve their habit, or that are noticeable but not disruptive. The classic example of a habit-changing behaviour that we can all identify with is when a supermarket brand alters their packaging. They introduce new colours, say. Or they change the position of the brand in the aisle. Suddenly you can’t ‘see’ the brand anymore, and that frustrates you. It also generates a reason to change brands to something else that you do know and feel familiar with.

Introduce a new habit with an incentive. And do it for a while. If you are going to ask people to change, give them a good reason to do so – something that has tangible value for them. And make sure that whatever you do becomes more and more valuable to them the more times it is repeated. Escalate the rewards. And critically, make sure that the incentive timeframe is long enough to allow this to happen. If you don’t give people good reasons to change for sustained periods of time, there’s a very real risk they’ll lose interest or convert. The new habit won’t have kicked in.

I really like Markman’s final piece of advice: “Study the habits of people who use your competitors. Find ways to affect their environment to get them to think about their choices.” Obvious when you think about it, but so many brands don’t turn their competitors’ weaknesses to their own advantage. That doesn’t mean of course mimicking what others are doing. It means doing more of what was talked about earlier – observing, upgrading and re-presenting a habit back as a better way of doing what customers already know and like doing.

Alongside your efforts to ‘new and improve’ your product, you might like to ask what you could be doing to ‘new and improve’ how your customers love to behave.

In your face

I think you can read a lot of things into Facebook’s decision to team up with Skype. It certainly aligns with my “war of the worlds” theory in some ways. But what interests me is that, regardless of the technical pros and cons, it does actually make sense from a brand point of view. (I’m still far from convinced that Skype constitutes a sustainably bankable business, but that’s another argument.)

Facebook’s brand is all about people connecting. The introduction of Skype simply channels that sentiment into a different technology. Looking for new partners in an increasingly scaled and bitter war, they have literally searched as far as their own name. Who else is in the business of ‘face’ that’s big enough to feel like a meaningful ally? And it’s a simple reminder to all of us that sometimes the best diversification strategies are staring us straight in the … Quite.

Now all it has to do is work. No pressure.

Not worth the paper it’s written on?

What do you do with a toxic brand? If you’re News Corp it appears, you opt for euthanasia, perhaps in the hope that the sheer ‘shock’ of stopping a 168 year old institution dead in its tracks will be enough to divert the rest of the media from your crown jewel assets and side-track regulators and other scrutinisers into believing you’re done enough to warrant completing other lucrative deals.

Consumers can be remarkably forgiving, especially with brands that forge a ‘bad-boy’ reputation. But, as in the case of News of the World, there comes a point where they over-step the mark and brands pass through a thin veil from scandalous to unacceptable. The paper seems to have gone there, in the public’s mind, with its actions over Milly Dowler.

Then what should they do?

The problem with dramatically wiping the brand from the face of the Earth by way of a response is that you bury the problem, and are seen to do so – which doesn’t address or resolve the deeper and more troubling questions such as why the brand was allowed to behave like this in the first place. Heads have rolled. Arrests will follow. But for advertisers the disquieting ethos has not been seen to be adequately resolved.

Nick Liddell, global strategy director at branding group Clear, provides some great insights in this article by comparing News Corp’s actions to those of a utility. Utilities, he points out are largely concerned with maintaining a reputation that ensures they can keep their license to operate. “The companies that are used to behaving like utilities understand that … having the brand is what makes them visible, and that being visible is what makes them accountable … [News Corp] could find that axing News of the World does nothing to make them seem more accountable.”

I agree wholeheartedly.

Whilst I am no crisis management expert, from a brand point of view, it seems to me that media organisations live and die on their integrity and on their ability to identify and quantify, as well as report, on what is happening. If I was advising News Corp I’d have put ‘demonstration of integrity’ at the very top of my list of priorities followed closely by ‘transparency of actions’. So I might have agreed to open the books to the relevant authorities, for example, or pressed for an independent review with a commitment to stand by the decisions. I would certainly have fronted the media and been as open and frank as possible.

Far from defusing the situation, the apparently impetuous act to close the paper (and I’m not convinced at all that it is as ‘impulsive’ as it may have been portrayed) and the perceived protection of selected members of staff has annoyed loyal readers, probably had little influence on regulators and increased suspicion that there is much more to this than News Corp is prepared to let the world see. And we haven’t even touched the sides on the messages that such actions send internally.

If the agenda has indeed been to protect the company’s license to operate, then I agree with Nick Liddell that the most meaningful thing News Corp could have done was to put up with the flak and continue operating. Having dealt it out for years to celebrities through News of the World, News Corp seems to have been a great deal more circumspect when the boomerang returned.

The wider message for all brands facing difficult or embarrassing situations is that you may prefer to say nothing and your lawyers might counsel you to say nothing – but for your consumers and for regulators, there is no comfort, or reassurance, in silence or silencing. In fact, there may be even more reputational risk.

 

Are your analytics cheating on you?

Numbers matter, but different numbers matter differently. To me, one of the great confusions is extent and value:

• Extent – how far your brand reaches.
• Value – how much your brand is worth (both literally in the minds of the market and in terms of margin in the minds of consumers).

The temptation is to assume that the brands with the greatest reach must (ultimately) be worth the greatest amount of money and therefore have the greatest value. But to my mind that’s an assumption too far, because of course extent does not monetise or convert to sales consistently, and the value that can therefore be placed on that extent varies greatly.

Does a brand with more likes make more profit than a competitor that doesn’t have as many? Sometimes. Perhaps. I guess. And what’s the critical gap? At what point does extent start to bite? Don’t know.

I’ve seen lots of assertions about the value of reach, but few about the cumulative bottom line effects for most brands with a social media presence.

I’m not saying for one moment there isn’t a relationship, or that a business case cannot be made. I am saying that the two terms are often confused and I haven’t seen the case made well, except for brands that do use their reach directly to monetise their model like Google obviously.

If you’re a retail brand, the fact that your brand has X,000 followers or X,000 likes or even X,0000,000 visitors indicates reach, and therefore influence and possibly authority – but there is no way a lot of brands can quantify that on a balance sheet. There is no automatic translation. Therefore it does not have tangible economic value. It has potential. It shows inclination, even preference. And those are important emotional metrics for brands because they can show whether you are maintaining interest and relevance, but I have yet to see an evidence-based correlation between those numbers and what customers are therefore prepared to pay in terms of increased margin.

A lot of people clapping doesn’t always ring the till.

In fact, in the case of Apple, the model works in reverse – they have less reach than other brands in terms of market penetration, but the monetisation of their brand, via the prices they ask and the margin they generate, is huge.

Part of the problem of course is that reach can quickly extend to millions and millions of people, but it can also quickly retract, so it’s a model with significant in-built volatility. To paraphrase Heidi Klum, “one day you’re in and the next day you’re out”. That reference is not as far-fetched as it may first appear. The social crowd is also a very fashion-conscious crowd.

Enjoy your reach by all means. Follow your analytics. Attract followers and likes. Lift your Klout score. But please don’t assume that means that one day you’ll be able to bank on them.

Renormalising

Brands are all about habits. But as this article in Time reminds us, sometimes the best thing a brand can look to do is to change a habit – even if they helped create the habit in the first place. Of course, brands tell themselves they do this all the time – but for many brands, the focus of their problem solving is on increasing consumption.

Their answer to a pattern they feel they know and understand is more of that pattern.

But the insight here is that changing a habit for the better doesn’t necessarily mean just offering the consumer more of what they have, or more of what the brand perceives consumers want.

In the context of the fast food industry for example, generosity is not a competitive advantage. When everyone’s offering bigger portions, the portions aren’t more generous. They quickly become the new normal. The pattern itself hasn’t changed, it’s just got bigger.

One of the reasons why brands are so reluctant to change patterns is that they take so many of their cues from what they perceive to be consumer behaviours. What they don’t always stop to do is check whether those “normal” behaviours are how people want to behave, or whether in fact they are simply how people do behave because a sector is driving the behaviour that way.

Here’s a pattern, by way of example. Consumers are eating the double-stack burger and barrel of chips because that’s what everyone is offering them when they order a family-size meal. And if it’s there, they’ll eat it. Habit. It’s not their fault – “The brand made me do it.”

That doesn’t necessarily mean though that they want to eat that much food. Or that they wouldn’t eat less. Or that they wouldn’t like to be offered less.

But that’s how marketers have taught themselves to analyse what’s going on. If that many people are eating that many big meals, and competitors are offering big meals, that’s the pattern. Which means they need to offer bigger meals. Which they then do. So the consumer eats more. And on it goes …

Until some smart soul breaks the cycle – and renormalises the category.

In fast food for example, consumers fed up (sorry!) with feeling they might have to discipline themselves about portion control, are now asking brands to do it for them – and recalibrating offerings in the process. Super-sizing is out. Miniaturising is in. Small meals, small drinks, small treats … great for the brands, because proportionately consumers are paying more per mouthful for the privilege of having less mouthfuls. And great for the consumers because they feel they’re doing something that’s good for them.

The very clear message: if your brand is competing in a “more is more” scenario, sometimes the wisest thing you can do is make the case for less, not by pointing out why people should abstain, but rather by developing an offering that still feels desirable and yet also seems more responsible.

In broader terms, wherever a market follows a pattern as a pack, the disruptive opportunity is to redraw what you do by packaging an answer that makes sense and takes control. Don’t just ask your consumers to break the habit or, worse still, go without. Instead, check whether what they’re doing, and what the market is used to, is the behaviour consumers would like to be making or the one they have been given.

If the habit they’ve got is not the habit they want, your opportunity is to offer them a way to re-normalise that habit, via your brand.

We need to talk

What have you got to say for yourself? We were talking about this today as we discussed how and when a brand should best take a stand. Go hard or go soft?

Soft. Taking a stand this way is about clearly and simply stating the things that you cherish and value as a brand, in such a way that consumers have clear line of sight between what you say, what you offer, how you act and what you value. It’s positive. It’s connective. It’s constructive. It’s honest. It shows the strengths of your beliefs. Specifically, it explains your worldview. We do this because … Or we don’t do this because … It’s not emphatically saying we’re right or wrong. It puts opinions on the record and asks the consumer to sign up if they want to. It proves consistency.

Hard. What polarising brands do. They set out to set up sides and they do that by deliberately upsetting people, by getting under people’s skin, by provoking the response they want. Often they court publicity by working people’s biases – sometimes in a fun way, sometimes in a not so healthy way. They poke the finger. They call others out and say they’re wrong. They accuse. They piss people off. It proves passion.

Both approaches work, but interestingly they work for consumers in different ways at different times. Because there are times and things we want our brands to be hard about, and times when we’d just like to softly know what they’re thinking. If we have passionate views of our own for example, we often side with brands that loudly articulate a similar viewpoint. That’s because we identify with the view they are expressing. It concurs with our own. We enjoy hearing them shout the odds. We egg them on.

On the other hand, there are times we just don’t want to hear too much about what a brand thinks. Providing they have a view that seems consistent with who they are, that’s enough. Often we feel like this about things that don’t really matter to us, or at least most of the time pass beneath or around our radar.

Brands need viewpoints. But they also need judgment. They need to know when it’s important to their consumers that they get on the soapbox, and when it is best to just have an opinion for those who are motivated enough to look.

The same concern can call for very different stances from different industries. If you make toys, I’m very interested in your views on child labour, particularly if your products are made in some parts of the world. If you’re an accounting practice, I might still like to know what you think but, because it’s less directly relevant to what I buy from you, it might be less important to me to know what you’re doing about it.

Relevance fuels reaction. And expectation.

So if you do have a viewpoint that you hold to, and articulate loudly, you need to show your consumers why you’ve made it your business to get so hot under the collar about it. You need to join the dots for them.

Markets are noisy. Everyone says you need to get consumers’ attention. They’re wrong. You need to get and hold consumers’ commitment. And sometimes the best way to do that is to shout what you think from the rooftops. And sometimes you just need to show you’re true to your word, and stop there.

Just like in any relationship. Both sides need to talk. Sometimes loudly. Sometimes quietly. They just don’t need to talk in the same way all the time. Or else they switch off.

Positioning your brand through memories

I think it’s healthy for there to be a direct relationship between memory and frequency for a brand. The more often a customer comes into contact with your brand, the more consistent the memory needs to be. That’s because brands that frequently interact with their customers have the power of habit on their side. In fact, when someone is buying from you frequently, the memory itself needs to focus on regularity: greeting customers by name; being easy to find; recognising what they like and maybe working with that; introducing suggestions that fit with what they’re looking for. The memories are smaller in their impact and their “experience” factor, but their frequency makes the effect powerfully cumulative.

By contrast, when your customers only interact with you occasionally, then the memory needs to be stronger and much more enduring. It literally needs to “last” until the next time a customer needs to buy because there isn’t the same front-of-mind of course – which means less consistent awareness and less reminders. It’s easy for customers to decide to explore a new technology or take advantage of what they see as a better price.

Natural or special? Which sentiment do you generate? The feeling that comes with a trip to your favourite deli or the excitement that wells up at the thought of a trip to another part of the world? That’s the choice for many brand experiences. Something so easy that life wouldn’t be the same without it. Or something so wonderful that you really look forward to buying it again.

Which one do you want to be? For some professions that’s easy. If you’re a grocery brand, for example, or a snack food. Or if you’re a luxury perfume or an upmarket clothes store. But sometimes that choice is less obvious? If you’re a firm of lawyers for example – how do you want your customers to feel about you? Natural or special? If you’re a consultant? Or a speaker? Do you want to be familiar, trusted, part of them, or a treat, something indulgent, an occasion?

Perhaps those are the real ways to think about positioning your brand. What expectation do you want to set, what timeframe do you want to interact in and what memory do you want to generate?

A brand that discounts or a discount brand?

This article in Time on how to get the most out of Apple is a reminder that there is a noticeable difference psychologically between a brand that discounts (even if it’s only occasionally) and a discount brand. Apple does discount – but for selected parts of its range or for specific reasons: change-over on a model, for example. The most important thing is that they don’t give that impression.

Apple’s approach is to treat price as a reliable indicator of value. By not overtly or uniformly discounting, they maintain the value of the brand by making products that excite customers and they continue to charge for them at that level of value until there is a good reason not to do so. In other words, Apple’s ethos is never discount an Apple product while people are most excited about it – no matter whether that is days or years after it was first released.

But while Apple have worked hard to position themselves as a full-price, full value brand, that’s not always the case. As the article points out, “With the exception of the iPhone and the iPad, Apple products are typically discounted within eight days of first hitting the market …” Surprised? I was. But “As for the most in-demand Apple products—iPad and iPhone—there doesn’t seem to be much financial incentive to delay your gratification. The price for either is unlikely to change by waiting a few days, or even a few months … discounts have basically been non-existent until it’s time for Apple to introduce the latest new-new model.”

Even when Apple do discount, the wider motivation seems to be to give customers entry points to the Apple universe. By lowering the price of a laptop, they invite customers into their world, knowing that they will then be pre-disposed to go Apple all the way. At least that’s my theory, and it’s one I think extends to the pricing of their new operating system. Lower the barriers to entry to get people involved, but retain the pricing and the aspiration on the iconic products that people continue to be excited by and around which the world of Apple pivots.

Such an approach seems worlds away from the volume-driven approach taken by discount brands that advertise serial sales to drive up their top line. But as I’ve said many times before, there’s nothing wrong with that model if you’ve built your business and your brand around it. Smart discount brands rely on a very different perception of price though than a brand like Apple. Whereas Apple sees price as proof of value, astute discount brands treat price as a pain point. And they rely on easing perceived pain in order to generate interest. They rely on you paying less in one area but more in others to help balance the load. Just like with Apple, it’s a feel-good balancing act. The difference is that one brand makes itself known for discounting and the other doesn’t.

One truth straddles both approaches. No matter how you choose to use discounting, to use it effectively you need to hard-wire it into your ethos not just your pricing. You need to be very clear too about how it works to protect your margins store-wide.

You might like to ponder that the next time you see a sign advertising “30% off selected lines”. Which lines have been selected … and more mportantly, why?

 

Competition amongst brands in the social universe: is it an open and shut case?

This thought-provoking Fast Company post calls into question something that I think most of us hadn’t even bothered to question – and that is whether in fact social media sites compete with one another. Google’s Eric Schmidt has argued for some time that this is not a zero-sum competition and that Google does not actively compete with other social networks, saying that everyone benefits when people spend more time online.

As the article observes: “Social networks often confine user data to their websites, forcing users to stay within their ecosystem … Google, on the other hand, seems intent on exploiting its newfound popularity to force rivals into more open data policies.” The article goes on to reference Google’s Chief Economist admitting that their products want to push Google’s open standards on competitors.

My sense is though that you always need to approach the concept of competition with an open mind. And that’s because while brands may not wish to, or expect to, compete in some ways with one another, the element of competition, and therefore the search for advantage, is always there with commercial endeavours.

For example, in this particular set of circumstances, it may not be in Google’s interests to compete for access because, as I’ve said before, closing systems to search actually compromises Google’s scale model. Google’s revenue model is built on traffic – so the more traffic they can encourage directly and through third party interactions the better. And the more that they can make searchable, the more important they are for users. They have a lot to gain from a more open social universe.

But I very much doubt whether Google would be quite so generous about sharing or ceding revenue. In that arena, they will absolutely compete head-on with others (including more traditional channels of course) for market spend priority.

The same applies to many brands. There are times when being seen alongside one another is useful – it works to the benefit of all – but that doesn’t mean brands are necessarily going out of their way to help one another. At some point, the commercial realities must apply. Coke still want other drinks to be available at the outlets they’re sold at, because otherwise consumers would feel they had no choice and the integrity of the outlet as a convenience channel could be compromised. At the same time though, they want to access as much of the beverage buy as they can get at that outlet and to make the maximum amount from the space allocated to them.

Markets are full of dichotomies and this is just another one of them.

Collective mass makes companies, particularly in emergent channels, credible and therefore viable. Google, Facebook et al carry weight because they carry numbers. Schmidt’s right when he says that everyone benefits when people spend more time online, and to do that users need to be able to move freely and easily online. Sharing, liking, linking etc have done a huge amount to foster that. And in that sense the competition is not zero-sum amongst the participants. They need to demonstrate that they are a collective force to be reckoned with. They need to continue to expand and to progress. That’s what makes them a sector.

And yes, I think we will continue to see co-operations, such as the Skype/Facebook alliance, where parties stand to mutually gain from an association, again based around access to services/experiences that the other is renowned for.

But beyond that? No. And the reason is that you always need to distinguish in situations of co-opetition between what’s not at stake and what is. Ultimately open systems and open searching carry few sacrifices, but they have the potential to deliver convenience, speed and goodwill to all who participate. There’s actually very little at stake from the parties working together. But elsewhere, where there is actually earnings to be lost, or even put at risk, the stakes are very real and competition will continue to thrive. In fact, it would be illegal if it didn’t.

 

Nudging: making the most of the power of suggestion

We’re much more susceptible to the power of suggestion than many of us might like to think – at least that was my take-out from more reading from Time: this time on how brands use buying suggestions to entice us to buy more than we might otherwise.

The article quotes John T. Gourville, a Harvard Business School professor of marketing who specialises in studying pricing strategies. Consumers, he says, tend to follow the suggestions listed in brochures or store aisles, so people tend to buy the amount, or buy in increments, that are advertised. If they see five for $5 or 10 for $5, they buy five or ten, regardless of the fact that they normally buy three.

And that, as the article points out, is the key strategy here: to get consumers buying more than they would if there was no sale. It seems we respond positively too to the suggestion of limitation – imposing a limit of two per customer or six per customer incentivises people to buy right up to that limit. The article concludes, “this is the power of suggestion at work, and it has little to do with whether the item’s sale price is good, or whether you, the consumer, actually wanted any of that soda at all.”

So, if you want to increase how people respond to your brand, make suggestions. Try with this, add that, good with three of those, best value when you buy six of them … and then look to put a limit on how many.

Intriguing isn’t it? That retailers can nudge people to buy more and yet restrict how much more they buy almost in the same breath. But it goes back to two things about brands that we need to remain mindful of. As consumers, we’re looking for guidance and value in a world of choice. Brands need to make use of that, but not abuse it. And secondly, exclusivity never fails to intrigue us. The moment we’re told we can’t have as much as we want as consumers, we immediately want all that we can get.

In a world where everyone just expects access, and to have things rammed down their throat, almost so that they can ignore them, making something unreadily available can be a sure way to get attention. It works for selling wheelbarrows. It’s working for Google+.

At times, a nudge really is so much more compelling than a push.

 

Volume is nothing like intensity

Speculation in recent days about what a “fan” is worth to a business is a timely reminder to separate volume from intensity.

Many commentators in the social universe it seems to me remain beguiled by quantity. The more liked you are, they seem to think, the more valuable you are potentially. Not so, of course. It costs nothing to say “like”. And in many cases I would venture to add, it means nothing and adds nothing.

Intensity though is quite a different metric – because it speaks to commitment and the bottom-line results of that commitment rather than just impressions. Intense fans buy the brands they feel strongly about. Money changes hands.

Intensity also defies volume. If you have customers who feel intensely committed to your brand, then you can have a much smaller, much less impressive number of them. Apple doesn’t have the biggest market share in a lot of the sectors it participates in, but it has perhaps the world’s most intense fans. And if a good percentage of those committed people only buy your brand or purchase predominately from you, then they are actually worth much more commercially than the hundreds of thousands of people who like you and move on without even a sideways glance at the cart.

Edward Boches says that we should also treat with real caution any suggestion that a “like” is a new customer and therefore a potential convert. In an excellent post on which came first – the loyalist or the like – Boches has this to say about the real market value of fans: “A program that strives to pile up fans will at best simply identify people who are already loyal. At worst, it will convince someone to click a button because it’s effortless, but potentially also meaningless.”

He continues: “The only thing we should be measuring is whether or not [what we do] induces prospects to become customers and customers to become repeat customers …”

Amen.

Like is a button. Commitment is a purchase. And brands the world over should be seeking to be intensely bought rather than just freely shared.

 

Announcement: Now on Facebook

In a move that may surprise some after my recent posts, I’ve decided to make a move onto Facebook by starting a Mark Di Somma, Writer page.

The main reason is that, in addition to providing a place for those who prefer to go to Facebook to get their stories, some of the topics/developments that catch my eye have ongoing coverage, and I see this page as an appropriate place to carry on threads of conversation that fall between a post and a tweet.

For example, I’ve just linked to a story from Fast Company that concurs with my thinking around “war of the worlds” as it applies to the consolidation of social media. I’ve also linked to another story there about the growing awareness of CSR credentials for consumers and what that might mean for brands.

I hope you’ll join in.

 

The vital (and ironical) difference between brand and identity

Are there such things as brands in much of the Government sector? I don’t think there are. That’s a good thing. And here’s why. I believe brands fundamentally require a competitive environment in which to actually work. I’m sure there’s an economic model that explains why – I don’t know it. But the reason why and when I believe brands work best has to do with the value I think they are intended to create: to drive preference; to encourage loyalty; to lift margin; to underpin and align a competitive and commercial business model with the people who believe in and buy from that organisation.

Brands have to work to help consumers to make choices. They need to stimulate recognition, preference and loyalty based on interaction and clear senses of expectation and delivery. Therefore you need to have both choice and competition available. There are of course parts of the public and local government sector that are contestable – and there the dynamics of brand work well. Equally in the NGO sector, one of the most competitive sectors of all in my opinion, there is huge opportunity to use brands to good effect, although many don’t. (We should talk about that some time.)

But where brands don’t work is where people have no choice and no competition. You can’t brand treasury functions for example or Inland Revenue. You can’t brand welfare. You can’t brand public health, airport security, food regulators (in fact regulators of any sort) etc. And you can’t brand local government either.

You can, and must, give those organisations identities so that they can be recognised and contacted but that doesn’t make them brands. An identity is not a brand.

Brands are driven by the need to create profit by delivering to customers. Non-brands are judged on their ability to frame, uphold and deliver on robust systems and processes.

Those are completely different frameworks – and rightly so. As the world has discovered on a number of occasions, bad things happen when you let brands run riot without market controls and equally when you ask public-good entities to suddenly adopt a commercial model when there are no competitive forces to keep them in check.

So to the irony. A brand always need an identity. But sometimes organisations with an identity work best if they don’t try to behave, or think of themselves, as brands.

Is thinking a desk job?

Over at Conversation Agent, Valeria Maltoni asks :Where do you do your best thinking?” For me, it depends on the problem. And what I think and even how I think about something is directed by that. Here are my seven favourite approaches:

1. Sometimes it’s sitting somewhere quietly with a pencil and paper and just writing thought sequences down until something clicks. Usually that’s about rethinking the associations. Scrabble means charades with a touch of Pixar over a business model.

2. I read avidly for the same reason. It’s all about finding different lines of logic. Disrupting. That’s really good for new products or ideas where there is no precedent or if you need to put daylight between what normally happens and what will need to happen for the brand you’re working on. Read about a completely different situation, and then apply what you got from it. To find out more about this, read The Medici Effect.

3. Other times it’s a walk – to get sensory inputs such as eye contact, noises, colour, vistas. Good for getting into the emotions of a situation or problem. Take your phone, sing to yourself, absorb. Good for quiet days.

4. Finding a picture of the situation works the same way. It can crystallise the situation and quite literally frame the argument. It’s not unusual for me to spend hours trolling National Geographics in search of an image that epitomises a situation or a relationship for me. I recognise that this doesn’t always look entirely productive to other people. Visual people get it. Others struggle.

5. Actually going to a place, sitting with a coffee and watching what people do in the real-life situation can be amazingly insightful. It almost always challenges your preconceptions because people don’t behave as you’d expect, and even knowing that, you can still be taken by surprise. A cross between playing detective, amateur psychology and thinking of a problem like a documentary. Very good when you need to change a habit.

6. Sometimes it’s good to talk – but not always about the problem itself. I have conversations with Gren, Alex and others that seem to cover everything but the issue. They work. I always walk away feeling everything has snapped shut. Everyone else seems to walk away in a state of bewilderment tinged with amusement. Synapsial. Good for lateral answers. Requires humour. May look like time-wasting to others. I think of it as the water-cooler comes to the meeting room.

7. If it’s a seriously knotty issue, it’s time for a bath – a habit I happen to share with one of my favourite authors, the late Douglas Adams. In a book about the making of the original radio scripts for Hitch-hikers’ Guide to the Galaxy, there’s a lovely story about Adams’ love of Chinese takeaways and baths, and his tendency to consume more and more of both, the closer he got to deadline. As a result, the more pressing the timeframe became, the cleaner and more replete the writer. May or may not work for you.

Out-take: Work doesn’t always have to look like work in order to work.

Sure you’re social, but are you interesting?

Fans matter, but friends of fans matter more it seems when it comes to spreading the word. According to this article in FastCompany, just 16% of company messages reach users in a given week, and the solution to that is to reach the friends of fans. So while Starbucks’s 23 million fans is impressive, the bulk of the numbers are the friends of those same fans: 670 million.

In other words, you can tick all the boxes in terms of traffic and friends, but the real sphere of influence is actually at the next degree of contact – and the dynamic driving that is the somewhat old-fashioned notion of talkability.

You may recall, some time back, the discussion about how many degrees of separation have strength in the social universe. How far into the network of friends of friends of friends do you have to go before the signals fade along with the trust? What this piece indicates to me is that two degrees out the message can be even stronger than it was at the first point of contact if it makes it that far. And the reason is that people aren’t hearing messages from brands themselves, they’re hearing about those brands from their friends.

I suspect though that the dynamic forks at the next level out. There is either huge drop-off as the subject runs out of talk-time or your brand “trends” and the talkability continues to climb as word gets round.

Ultimately though the take-out from this research has nothing to do with social media at all. The thing is, if you’re interesting people will talk about you – and if you’re not worth talking about, your brand will only get as far as the fanboys.

Most people recognise that you can’t just start talking and expect to pull off a keynote. Some planning needs to go in. Equally if you want people to have conversations about your brand, what do you want them to talk about? Have you planned the talking points? Or are you just leaving people to talk amongst themselves?

So many brands it seems to me start from a premise that they must be fascinating because people like them. Yes, that’s true for the first circle. But how do you get pass-on? How do you appeal to people where your brand doesn’t have top-of-mind?

My suggestion: take a hint from the world of costing and start from a zero-base. Assume no inherent interest and look at how you will build interest into who you are, what you do, what you say, where you go … to reach a targeted level of interest amongst that bigger friends of fans group.

You’re only as interesting as you make yourself.

 

Last week on my Facebook page

Some of the things I’ve been linking to and talking about over on my Facebook Page this last week:

1.    Allen Adamson’s article on why MacDonald’s decision to change their Happy Meals can’t be a one-off.
2.    How KFC have decided to honour their founder – yes, there really is a Colonel Sanders.
3.    The power of personal branding is called into question: does it in fact generate quite the opposite – a self-commoditising brand?
4.    The addiction of customers to social media and what influence that might have, now that it’s become a societal habit.
5.    Upgrades to catch up: why the ship-it-fast mentality may be causing tech manufacturers to short-cut excellence.
6.    Great article in Fast Company on six ways to build a thrilling brand.
7.    Seth Godin’s post on the flip-side of influence.
8.    Some great ideas on how to build interestingness – written for people, but just as applicable to brands.
9.    The emerging use of social media as a customer collaboration tool.
10. Martin Bishop weighs in on whether News Corp’s “house of brands” approach will be enough to protect them.
11. I ask what should we read into the move by Hollywood players to invest in social media companies.
12. Is influence a self-fulfilling prophesy?
13. Local government is just one of many places where brand and identity are used as synonyms … and probably shouldn’t be. A follow-on to my post on the difference between the two.
14. Interesting Fast Company article on the first signs of social consolidation.
15. A look at how more and more consumers are holding brands accountable for their actions.

 

“Why do they only look like that in the ad?”

You want to tell the best story you can, to showcase your product in the best light, to prefer you over others. So you show the optimistic end of what you deliver. The burger looks generous and juicy. The staff behind the counter are attractive and smile. The car corners beautifully on endless, empty roads. The child in the trolley in the busy but not overly crowded supermarket is gorgeous, and the product is lit up like Christmas.

Every brand manager wants to tell that story. Because it’s safe, clean, positive and aspirational. It promotes the product benefits. It ticks all the boxes. Except one …

It’s untrue.

The actual experience of course is nothing like that. And everyone knows it.

In reality the burger is dismal and squashed, the staff don’t smile never mind talk, the roads are jammed with irritated souls who make getting anywhere miserable and slow, the supermarket smells of over-ripe fruit and you can barely see the product because the fluorescent tube overhead is on the blink (sometimes literally).

Right across mainstream media, brands are still making promises they know they can’t deliver on. And they continue to wonder why effectiveness is faltering.

As I’ve said many times, the most dangerous word in branding is … who?

But the most dangerous sentence is almost as curt – “I don’t believe you.”

Intersections

At dinner the other night, the conversation turned to carpet ads. Why, someone asked, do retailers keep advertising carpet ads when most people only buy carpet once every 7 – 10 years?

Because, they don’t all buy them at once, I reminded them.

A brief explanation of interruption theory followed. Because so many retailers have neither the inclination or the resources to build and sustain relationships with their diverse customer bases, they basically rely on a marketing approach that pivots on informed chance.

Reach and frequency advertising models depend on reaching a profiled consumer at a specific moment when that consumer might have an interest and a need for the product. It’s a scatter-gun approach (despite what the media planners might tell us) that relies on a machine-gun barrage of noise and repetition. Most of the time it has the majority reaching for the remote control to turn off the noise because whatever’s being talked about is “N/A” to their needs right now.

But brands keep beaming ads in the hope that one day customer and brand will meet at a random intersection of supply and demand.

So what can brands with long sales cycles or infrequent purchase cycles do to lift their sales? The most common response is to lift the noise levels even higher by advertising even more – using ever more urgent ads. But a much better way to increase the chance of intersections in my opinion lies in convening an holistic product range that people intersect with more frequently.

So instead of only selling something occasionally, brands need to introduce products and services into their range that people want more frequently. That way those customers have more reasons to intersect with the brand across a range of timeframes – some occasional, some regular.

Apple carries this model out to perfection. Consumers might only buy a laptop or a new phone once every few years. But between those purchases, Apple encourages them to make smaller investments in things like an operating system, and micro-purchases like songs or apps at just a handful of dollars each. And in between those activities, they dot presentations and announcements to maintain buzz. (Which, incidentally, is another important point about intersections – they can’t just happen at purchase time if they are to retain value.)

Apple stays in touch with customers, and keeps them in touch with the brand, through multiple intersecting moments at various price points and – this is important – non-price points. As a result, the brand feels dynamic, exciting, rewarding and habitual – and consumers cultivate strong loyalty and interest.

Multiple intersections raise awareness, offer multiple access points and bring brands to life.

So if it’s a long time between interactions for your brand and customers, rethink your intersections. Give people more things to buy, more reasons to buy them, more timeframes within which to buy them, more price points to buy them at – and stagger and scaffold those offerings so that they feel coherent, consistent and desirable.

How brands lose sight of customers

Interesting observation in a meeting yesterday from Richard about service organisations, and specifically large service organisations and why they often lose sight of the customer and the shifting demands of a dynamic market.

Everybody says they’re in business to serve the customer, but the people who are actually customer facing and customer serving are often those with the least experience, the least knowledge and the least authority because that lowers cost-per-serve. Unfortunately, it also lowers quality, depth, flexibility and engagement, compromising the brand experience and making service a commoditised set of processes that frontline staff are judged on their ability to conform to.

The situation should logically resolve itself as people become more valuable to the organisation, and therefore gain what has been missing when they were on the frontline – experience, knowledge, authority, influence and networks. But what actually happens is that those people are shepherded into talent programmes that promote them further and further away from a direct relationship with customers – which is an increasing juxtaposition in itself – and their focus moves. It becomes more and more introverted.

Market-based innovation then becomes increasingly difficult, because the people now empowered to make change decisions are locked into an internal bubble that seals their own market impressions firmly in the past. They are also fighting battles and priorities that actually have increasingly little to do with where the money comes from.

Last week on my Facebook page:

Some of the things I’ve been linking to and talking about over on my Facebook Page this last week:

1. Steinlager looks for ways to challenge Heineken around the RWC without breaching the sponsorship rules
2. The decision by Kraft to split their brand portfolio points to a two-speed approach
3. Perhaps China’s imitation of successful Western brands is as much cultural as competitive
4. Whitney Houston asks ‘What job does social media do for you?”
5. Good reading from McKinsey on why we’re all marketers now
6. How companies are using trademark registration to gather brand intelligence long before offerings hit the market

Everything to no-one

Great question by Paul Dunay: Is sentiment making brands stupid? As the writer points out we are increasingly obsessed with using monitoring tools as virtual tea leaves to try and read the sentiment of the markets towards our brands. Mentions have become the new money – and machines now break those mentions down into chunks of data and attach a ranking to them that brand managers read as gospel.

But, Dunay argues, the premise is a false one because “most people can’t agree on the spirit or intention of a tweet anyway and they never will”, meaning brands could be giving greater credence than warrented to metrics that are easily lost in translation.

The direct risk from such an approach is that brands essentially treat social media as polling booths for their strategy, and are then unduly influenced in their thinking by the flood of opinions ebbing and flowing across the social universe.

It’s important to listen, we’re all agreed on that, but if brands then look to appease everyone and to compromise and tailor their offerings to suit, they will risk becoming everything to no-one.

 

Don’t be disappointed: why price underwrites the brand experience

What’s the difference between a budget airline and a pig? Pigs fly more often – and on time. Harsh perhaps, but it’s a reminder that in a market, there is always a price to pay, and the price is not just about money down.

Some people will be happy with budget. It’s worth a cancelled flight or two for the savings they make. For others, that’s far too high a price to pay for a few dollars saved.

Years ago, I was in a workshop where three people in the group were asked to make the business case for luxury over economy. The team made their case in a pointed and dramatic way.

First, they invited the wider group into a huge open sunny space, where sofas were laid out. Each person was escorted to a sofa and provided with bubbles and canapes. There was a sign on the wall that read $3000. Then, we were invited into a second room. This room was smaller, and instead of couches there were seats. Each person was asked to sit where they wanted and they were provided with a cup of coffee and a magazine. The sign on the wall read $1000. Then we were pushed and hussled into a third room. It was dark and small, with no outside windows, and instead of chairs we sat at school desks all bunched together in one corner of the space. Each person was told where to sit and all they were given was a glass of water. The sign on the wall read $500.

When we returned to the workshop meeting room, there was a simple question waiting for us. It read: Which room would you rather pay to spend 12 hours in – and why? Then we were asked: Which room would you rather pay to spend 2 hours in – and why?

You can imagine the discussion.

Each person will trade off what they get vs what they pay as they see fit. Some would rather fly on the plane and stay in an economy hotel no matter what the length of the journey. Others will want the reverse. And that model transposes almost everywhere you look. The main cinema vs the gold lounge. The budget burger vs the gourmet burger. Supermarket vs deli. The cheap perfume vs the eau de Cologne. Environmental vs irresponsible.

And no-one will do this uniformly. The days of the holistically budget buyer or luxury buyer are gone. Depending on what’s important to us, we’ll shift between budget, standard and luxury in most of our purchases.

That makes understanding what we are getting for our money even more important.

The key point for brands is that they need to make it very clear to their customers what the trade-offs are. Most don’t. They don’t carry storylines that explain why consumers are paying what they’re paying and why they’re getting what they pay for. They sell an aspiration – which of course is a key aspect of marketing – but it is an uninformed aspiration because they often don’t position price as an expectation indicator. They still see it, and treat it, just as a cost.

In the context of branding though, price is more than what goes in the till when the product walks out the door.

Price, when it is talked about, should be the clear and present underwriter of the experience. Chanel shouldn’t ever seem cheap. If it is cheap, it’s a fake. Walmart shouldn’t seem expensive. Neither should Coke.

If your price is right, your story is clear and your service is delightful, appropriate and framed to that price, no customer should ever walk away from the brand disappointed. They may walk away for another reason – because they’ve shifted their priorities or they can’t afford what they once had – but if they walk away disappointed, there’s only two conclusions.

People didn’t get what they thought they were paying for.

And if you don’t set that expectation, they will – which means, it may not align with what they’re actually getting.

Time to rethink the business model of some NGO brands?

Brands like Toms with their “one for one” shoes programme have proven that companies can be both profitable and philanthropic. So why do so many NGO brands stick with a funding model that relies on, well, charity?

Peter Salmon, MD at social innovation company NextPlays, certainly has his doubts about models based on grants and donations as opposed to “financed” business practices. Here are some of his thoughts on why “cause” brands need to stop begging for money and start putting up business cases for financing social change.

The current models of financing social organisations are through philanthropic grants, equity investment, or conventional debt financing, he says, but the dominance of foundation and philanthropic grants creates an ineffectual social innovation sector that delivers poorer outcomes.

1. Both financing and grant approaches require well researched documentation but a grant application requires a proposal, whereas financing requires a business plan. These may seem like subtle differences, but one is far more open to innovation than the other. Grant applications are often judged to fit within already pre-determined social development agendas, such as child poverty, or education. So organisations looking for grants end up tailoring their submissions to fit within the scope of the funding rather than focusing on how to get to the real outcomes. Financing has no such agenda. It judges the business plan on the quality of the value proposition, character of the entrepreneur and the likelihood of enterprise success. Financing doesn’t pre-select approaches, it determines likelihood of success.

2. Grant based social development agendas can also foster duplication of effort. This results in the funding of a number of proposals all loosely working in the same area of development, with each striving to achieve at times similar goals with similar structured organisations, resource and funding requirements. Finance applications by contrast are judged on the likelihood that the business plan will succeed. This requires the plan to clearly articulate the unique characteristics of the venture compared to its competitors aiming to serve the same customers or beneficiaries. Proving an enterprise worthy of financing is tough, but toughness requires innovation.

3. Grant based applications place emphasis on well researched understanding of the problem and likely solution, that if successful, leads to operational design of that solution. The process looks like this:

Problem ➔ Solution ➔ Grant ➔ Business model

This is counter to modern approaches to innovation. Larry Keely of Doblin Group has statistically measured that ’98% of all innovations continuously improve known solutions’. That is, they don’t try to create new solutions outright, but improve on what we already have. He goes on to state that some of the greatest innovation breakthroughs have come from using networks in new ways, and rethinking business models.

If this is the modern reality then Salmon says we need to take new approaches to social innovation and funding. More like this:

Problem ➔ Solution & Social Enterprise Model ➔ Financing

Organisations can’t leap directly to solutions without considering how that solution or enterprise will function. More time needs to be spent considering the social enterprise model prior to any form of funding application and what role the community plays within the business.

4. Finally there is the issue of financial sustainability. Grant funded not-for-profit brands can only keep working as long as the grant itself, so they spend a good deal of resources on continually seeking new grants and other fund-raising activities at the expense of focussing on the outcome they seek. A recent survey by Grant Thornton on ‘Financing Non-for-Profits’, stated that financing was one of the three greatest challenges facing the Charitable sector, and achieving their stated social goal ranked on average at seven.

Successful social enterprises, Salmon says, have the ability to generate income alongside achieving their social mission or outcomes, and profits generated beyond that can be reinvested into expansion or future development.

So why aren’t more brands interested? After all, this approach makes the business case for change that more and more sponsoring brands are asking for in their dealings with community organisations.

I suspect it’s because social innovation falls between the cracks.

For the more traditional NGO sector, who are often motivated by their cause, money is the means to what they perceive as the realistic goal, which is progress. This is also a sector that struggles at times to put commercial metrics around their work – so the social enterprise model looks suspisciously like commercialisation (read perhaps exploitation) of a situation. Such a model is highly disruptive to the philanthropic approach they are used to and geared for, and could therefore be seen as unnecessarily distracting in terms of its priorities.

For the for-profit sector, social enterprises aren’t created with commercial profit in mind, but rather for social outcomes – so that means returns don’t fit a conventional risk/reward curve, putting them at odds with the expectations of most investors. Many brands in this space believe their CSR work is commitment enough.

It will be interesting to see who starts building the bridges between these traditionally-different approaches first: NGOs looking to put their organisations on a more reliable business footing; or profit-motivated brands looking for new ways to engage with politicised consumers?

Critical mass: understanding what drives fluctuations in likeability for brands

Whilst I continue to question the financial returns from social media for brands, there is no denying their ability to galvanise. In fact, social media is the driving force behind “critical mass” – the ability to bring together consumers from many places to form a significant mass of opinion, in support or against, based around an issue they consider critically important to them.

For brands, critical mass can be a powerful forum for advocacy, feedback, testing, support and, perhaps most importantly, a way to stay directly attuned to what Mr and Mrs Consumer are feeling. But a critical mass also makes for a powerful enemy: as we’ve seen this past week, a group of people united by a single idea can turn on a brand with extraordinary ferocity.

Critical masses flock and disperse in response to ideas. People join, leave and link at whim. So these groupings are constantly forming, dissolving and reforming on a global scale. They are not one constituency. And the density of the mass and its duration derives directly from the galvanising strength of the idea, the momentum it gathers, and the response of the brand. These are instant opinion communities that can choose to express themselves as pages, groups, in the wider media or directly through a blizzard of tweets.

Social markets, just like their financial counterparts, are driven by sentiment and the interactions of many. And it is that participation that generates volatility. But unlike the sharemarket, critical mass drives partiality rather than actual value. It helps decide whose on your side and whose not – at any given moment.

For scaled brands, then, the sentiment of critical mass represents your likeability in real time.

Some days your partiality will be up – meaning people generally feel good about you. At other times, the mass of opinion will be negative, impartial or absent. Same for your competitors.

Understanding that, quantifying it and responding to it is significant for its importance and yet it can only be momentary in its interpretation.

Is Google mad?

No-one can accuse Google of resting on its laurels. But having sought to shape-shift the social universe with Google+, what to make of the decision to acquire Motorola? Are patents the latest tech bubble? This post on Business Insider certainly raises some doubts about the prudence of Google’s decision, saying basically that unless they’re in it to strip the intellectual goodness of the patents and run, this is a Time Warner-AOL re-run in the making.

The key concerns are:

The discrepancy in margins and profit ceilings between the two companies, with Google in a league of its own in online advertising and Motorola an also-ran in the low-margin frenzy of hardware manufacture. The common descriptor of “technology” is not enough to hold together two companies that are so disparate in their outlooks, priorities, philosophies and outputs.

Motorola will distract resources, time and attention. Without that, Motorola’s returns will quickly drag on the Google balance sheet.

And my own question – How does much of the rest of the mobile world which uses Android react to such a move? Isn’t there a real risk of cannibalisation here?

All of these points speak to a lingering disquiet on my part, which echoes the “diversification” strategies of the late 80s. Back then, the way to make money, common wisdom declared, was to broaden your revenue streams and/or asset strip and hock off the parts. All sorts of businesses poked their noses into sectors that were quite literally none of their business – often with disastrous results. My concern is that the “war of the worlds” will send tech companies down a similar route – delving into areas of the sector that they are not equipped, physically or psychologically, to maximise in the bid to land-grab whatever seems valuable.

If that happens, expect wreckage. Because one brand’s assets can rapidly become another brand’s liabilities if the set-ups and systems are calibrated incorrectly. Marrying a high-touch, high margin business with a low-touch, low margin business looks like a conflict of interests waiting to happen.

The question for Google is: do you really know what you’re looking for in this, and, ironically, will you find it?

 

The opportunity of dull

There are days when Alex really makes me laugh. I grinned merrily at her observation recently that if you really want to make significant changes as a brand, you should go all out and look for something … dull. That’s right, find something uneventful, even pedestrian – and poke it for opportunities.

And the reasons, on reflection, are simple. Chances are people do whatever it is often. So it comes with scale and frequency. And secondly, if it’s that tedious, frankly the only way is up. High energy, exciting activities already have high EQ by their very nature. And they attract the most interest from brands. So the chances of doing anything breakthrough are so much harder. Dull stuff is out of the limelight. It’s dull and it stays dull for most people until someone does something to change that.

So it’s actually a lot less difficult to make the boring better: to take something that people don’t want to do or don’t enjoy doing, and to inject new elements and ideas that surprise and delight. Wii made exercising at home fun by combining it with gaming. Obvious on reflection – but it sure the hell works. Apple makes shopping appealing (even for men) by giving even those who aren’t into IT something physical, fashionable and beautiful to fidget with. They understood that many people were completely turned off by computer stores – so they went out of their way to make shopping for their stuff feel as ungeeky (and yet as clubby) as possible.

What brands should be looking for, according to Luke Williams, a fellow at Frog Design, is not so much the big pain points as what he terms “tension points”: those things that are annoying or less than perfect but not big enough to be considered problems. He cites the example of Dutch Boy Paint which introduced a Twist & Pour container featuring an easy twist-off lid and a neat-pour spout. It did away with the need to pry open the lid with a screwdriver and reduced spilling and dripping. Read the article. It’s very good.

But often brands can take this further than answering problems. They can develop ways of thinking about what they do that challenge disinterest at every level – because that’s the real issue. That’s the brand-killer.

And the systemic question that gets you there is this: “What’s the most boring thing we do?”

Fix that. Find ways, using techniques such as those that Williams has suggested, to make whatever it is more interesting – for you, for others and most importantly for customers.

Then ask the same question again. And fix the next thing the same way.
It could be the way the phone is answered, or the state of toilets. It could be the fact that there are no plants in reception. Or the forms people need to fill in. Little things that everyone does that are boring but deemed necessary. Because dull is usually small. And the great thing about little is that it makes things do-able. Quickly.

Your goal as a brand is to be fascinating at every level for the people you are trying to reach. That won’t make you Apple or Diesel of Chanel necessarily – but it will make you a lot more attractive and compelling than your competitors. It will enable you to ‘brand’ an activity, however menial, your way.

So often companies look to achieve competitive advantage by building better things and making efficiency gains. But from a brand perspective, you don’t become more interesting or likeable through continual improvement. You can if you commit to becoming more exciting.

Are you indecisive? I’m not sure …

Edward Boches pointed me in the direction of this thought-provoking article by John Tierney on “decision fatigue”. Decision fatigue happens when ordinary people are asked to make decision after decision after decision. Such processes run down the mental batteries that power our self control. Eventually it seems, we start looking for shortcuts – either by acting impulsively or by opting to do nothing.

Research on what tires us out the most shows that people would rather compare and contrast options (without making a decision) or verify a decision that has already been made by someone else than make the decision themselves. Once consumers reach a certain level of mental tiredness they stop negotiating. Instead, they make decisions based on the thing that is most important to them. Decision fatigue, it seems, breaks down our reluctance to explore or commit. People soon opt for default settings or suggestions. And the more tough choices there are early in the process, the quicker people opt for the path of least resistance.

All of this has major implications for the ways that brands think about their ranges and their sales processes – specifically, the intensity of choices, timing of those choices, frequency of choices; types of choices (defaults vs calculations) and simplicity of choices.

There are also important compromises to consider. For example, whilst it might be easy to fatigue someone into making a one-off sale by wearing them out with decisions, what will their experience be in retrospect and will that sale engender loyalty and repeat business and/or WOM? Probably not.

For brands ranging from consultancies to retail, there are important way-finding opportunities in these findings: revealing the complexity/scope of what’s available, for example, needs to be tempered by actions that lead people directly to the things they are most enthusiastic to consider and feel in control of.

My clear take-out from this article is that choice can be a complicator not a liberator, that not all decisions matter enough to involve the consumer (but the secret lies in knowing which ones do), and that speed of transit through the sales process needs to be interlaced with feelings of control, excitement and reassurance.

In other words, the sales process for most brands should change gears to become easier the closer one gets to purchase, with the hard decisions timed to be far enough in for people to feel involved, but not so far in that they feel exhausted.

It’s certainly something to consider the next time you’re looking to change your sales process. Are we asking consumers to make the right decisions about our brands at times that are right for them – or are we pushing them to conform with a way of selling that suits our own energy levels?

Connecting your brand and your social responsibility policies

Almost every brand I work with has a community policy, an environmental policy, a sustainability policy … as they should. And everyone seems to acknowledge that the policy or policies they have form an important part of their reputation and their stakeholder relations … as they should. And yet precious few brands have actively connected those social responsibility activities with their brand.

They haven’t yet capitalised on extending their brand story to encapsulate those critical social elements.

Which is weird.

Instead, they have treated their brand and their social responsibility policies as entirely separate company matters. And I think the reason why is that many companies view their community relations or their environmental approach as corporate and/or compliance issues. They simply don’t see that those issues are intrinsically linked to the opinions and values of their brands.

So while they can often spell out clearly what policy they have, they often don’t spell out why they have the policy they have. And they often don’t look for ways to differentiate that policy from what others are saying in ways that are authentic to them (which is why so much of what companies talk about when they talk about CSR matters all sounds the same). Instead they often look to throw credentials at the issue by citing the standards they are meeting or the accreditations they have earned or bought.

The irony of this is that time and time again, we’ve seen brands take a hammering because a company is not seen to have met its social responsibility standards. So there is definitely a case to be made for brands monitoring their social responsibility behaviours. And there is definitely an appetite for ethical purchase.

Knowing this, I would suggest that these historically separated matters of brand and social responsibility policy need to be much more closely integrated. The thing is, it really makes sense for a brand to carry its beliefs through into its social responsibility platforms. And there is a clear opportunity for “Because … then” sequencing that so often seems to go missing.

Because we believe [this] as a brand, we are committed to [this] socially/ environmentally/ communally …

For example, if I managed a chocolate brand centred on good ingredients, I would look for ways to directly link that ethos to social, environmental or communal policies that are centred on protecting or ensuring goodness or integrity.

My argument might go something like this: “Because we’re obsessed with making the best chocolate in the world, we’re committed to sourcing the best ingredients in the world. Which is why we insist on ingredients that are grown …” You get the idea.

But I wouldn’t stop there. I would also evaluate the social responsibility policies that the company has in the light of the brand commitments I was making to see whether in fact, they are consistent and distinct. To make sure that the actions and the words do in fact align – and that the policy is not just that: textbook statements (platitudes) that could have come out of the mouth of any brand.

Question: How does what you’re marketing align with what you’re doing and supporting?

When you can answer that, it seems to me, you have a branded social responsibility policy that is so much more powerful and differentiating than citing standards. It makes what you stand for as a brand consistent with how you behave and why you behave the way you do. It makes your position so much more principled, coherent and defendable. And it gives you real reputational metrics to examine the rationale and the effectiveness of what you’re doing in the social arena.

Getting your social approach right: protecting your brand from critics

A number of people have asked me this week about how they should prepare their brand for attacks from activist groups who criticise them in the media. I’ll leave the mechanics of crisis management to the legal and PR people who specialise at it – but here are some thoughts on simple things you can do as a brand to make sure you are as ready as you can be.

1. Don’t view advocates for another opinion or worldview as enemies. You may not like what they say, or the manner in which they say it, but, unless they are physically attacking your business, essentially they are competitors (and on occasions even potential allies) – and the reason why they are more like competitors is that they have the potential to take attention, influence and market share away from your brand. So treat them like you would any other competitor: get to know them, get to know what they believe in and the opinions they compete against you on. Draw up a watch list. Keep an eye on their social media. Understand what they stand for in the marketplace. What you can’t do is pretend they’re not there or start engaging with them, either directly or indirectly, once they have done something to get your attention. If you do that, you will always be in catch-up.

2. Draw up a strong and simple set of principles that state what you believe in and link those principles directly to your brand, values and reputation. Those principles should be directly related to the things that you affect and that affect you as a brand socially. Use the “Because … then” connection to establish why you believe what you believe rather than just making apple-pie statements. (See my last post on social responsibility for more details on this.) State those principles openly on your website – and make your principles and worldview a critical part of your induction process, so that your own people understand from the get-go what you stand for. If someone draws attention to something you don’t have a principle on, make a decision quickly about where you stand on that point as it relates to your brand and values, and state that clearly for the record. If you don’t have a position, but you understand you need one, then say so and explain why you haven’t had such a principle up until now. Undertake to establish a principle, put a timeframe round it, and go public once you’ve decided.

3. Once you have a set of principles in place, establish clear measures for how you will ensure you comply with and progress those principles. These measures should be objective, credible, widely recognised and potentially monitored by another party. They show that as a brand you are committed to what you believe and that you operate within a clear metric framework. For example, if you are a beer brand, and one of your principles is that you will be a responsible and sustainable consumer of water, then you need to have measures in place that show what you mean by responsible and sustainable. They could be a globally recognised standard for water purity or a specific group’s recommendation on the amount of water you recycle. They should clearly show where you have purposefully set the bar and on what authority.

4. You need to set in place actions that contribute to you achieving your measures and that correlate directly with the measures you have put in place. These show how you are systematically working to achieve clearly defined and articulated goals. Those measures could include things you do as well as organisations or initiatives you support, research you have underway and aspects of your operations that you are monitoring and/or changing to reach the measures you have set. Such actions are a great way to involve your people internally and can deliver real bottom-line benefits in the way of untapped efficiencies. They also make sure that you continue to operate as a principle-centric organisation.

5. Report succinctly but clearly on what you believe, the frameworks you are using and the progress you are making with actions. It doesn’t have to be a huge CSR report. It could be a page on your website or part of your marketing.

Most of these ideas seem self-evident on reflection but it’s remarkable how many brands do not have a social approach like this in place. What that means is that when they are criticised in the media by an activist brand, they don’t know enough about who they’re dealing with, they don’t have a set of principles they can refer to, there are few or no measures that they can cite and there’s a mad scramble to find the facts as the phone starts ringing and Twitter goes mad.

Everything then comes down to a fight over actions, and a discussion conducted purely at that level is very difficult to win because it quickly becomes ‘they say … we say’ and your brand inevitably comes across as defensive.

You can use a similar Principles – Measures – Actions – Report process for other key aspects of your social brand too, such as your sponsorships. Let’s come back to that …

Measure for measure

Economist Brian Easton’s statement – “don’t talk about the intangibles when there is nothing else” – is a timely reminder to all of us in the ‘fuzzy’ areas of business that if there is no demonstrable bottom-line return for all the reputation enhancement, profile building, credibility, authenticity, loyalty and goodwill that has supposedly been generated by or at a particular event or activity, then it essentially carries no value. It may not be worthless, but the cost that has been incurred has subsequently made no tangible economic contribution. Therefore there is no actual return on the investment.

In that context, what brands are often getting, and paying for, is an impression – or at the very most, a contribution – towards an abstract sense of progress. A best guess.

That’s as true for those pouring money into the Rugby World Cup (Easton’s specific gripe) as it is for social media or advertising. If you’re putting money in and you can’t or won’t measure what you’re getting back on your bottom line over the medium and longer term, you are not actually getting back anything. You are throwing money at hope, which has probably been conveniently repackaged as “brand awareness”.

Awareness alone counts for little. You can build awareness anywhere – it doesn’t mean though that your brand benefits. The fact that 30,000 people watch a TV programme does not instantly give that programme value for your brand if you advertise there – particularly if the audience is 30,000 people who don’t buy what you sell. It simply means that there are 30,000 people out there with their TVs on at a given moment. If you advertise, then they’re aware you’ve advertised. That’s it. We know that about media. Everyone gets it. And yet when it comes to things like sponsorships or events, the logic often goes west.

The temptation, and indeed the preponderance of opinion, seems to be that being there will be enough: there’s a tendency to smooth over concerns with reassurances that efforts that can’t be measured must be ‘doing some good’, it’s just that no-one can say what or how much. Or else, particularly in the case of social media, to install and religiously reference metrics, such as likes, clicks and follows, that are themselves intangible, as a means of monitoring intangible effectiveness.

Having a measure may give you a number that you can add to your next brand report or board presentation. It may put another line on the flow chart. But, as Easton reminds us, that does not automatically mean you are quantifying anything, if the measure itself cannot be concretely and meaningfully defined and aligned with what really counts.

The fashion of value

The stark reality for most brands, particularly those integrated into a supply chain, is that if your presence is not seen to be value-adding, then chances are it is perceived as value-costing.

If indeed you pride yourselves on being able to value add, you can expect to be continually challenged on the difference you generate for the margin you charge. If you don’t, then replacement by another supplier or another channel, is probably only a question of time.

But perceptions as we all know are a moving feast. As priorities change and new technology shifts the frameworks, operations and expectations of businesses and consumers across industries, the continuing question for many brands it seems to me is this stark: What’s valuable now? The second question is more knotty: What’s our take on that?

Lessons from a great party

After some time away travelling, last night I was fortunate enough to be invited to a fantastic event on the Wellington waterfront. The place was packed with the renowned and the influential alike. I understand why it is regarded as the party of the year in the city.

The event itself served to remind me of two things.

Firstly, that networking complements talent and profile, and that if you are not out and about working your brand with key influencers, you are essentially neglecting your marketing – an observation that’s as true for how consumer brands need to network and engage with their supply chains and customers as it is for individuals. Affinity increases through dialogue. It’s not good enough to be good at what you do. You don’t grow your reputation by looking in the mirror.

Secondly, there are at least two distinct networking strategies – wide and open, or focused and intense – and they seem to permeate every aspect of how we choose to make and retain contact.

I follow very much the second approach. Whilst there were many people at the event last night who I knew by name, most of them didn’t immediately know me. The same goes for my LinkedIn contacts, my Facebook Likes and so much more. I’m not particularly popular numerically. But, as per last night, those people I do know, I know well and often have deep and trusting relationships with. We seek each other out.

That same premise applies to brands – you can either scale or cult. Both work, but in very different ways. Each has its limitations and its strengths. Only you know which works for you – and whether this is the approach you conciously choose to have, or the approach you are landed with by default.

To my hosts … thank you so much. Last night, it was very nice indeed to be considered a friend.

When sales go wrong: the real cost to brands of bad sales

A car salesroom should be like Disneyland – a place of magic, where life smells wonderful and dreams really do come true. So much resource goes into making that possible. The warm environment, the sparkly cars, the people, the music, the freshly brewed coffee … Everything should be an unapologetic charm offensive designed to inject reassurance and a sense of joy. When it’s done properly, it’s a show stopper.

But over the weekend, my trip to start searching for a replacement to my very tidy but ageing Peugeot turned into something closer to Nightmare on Elm Street: a clipped salesperson talking to me in a patronising tone and treating my spouse with disrespect. No charm. Just offensive.

Which meant in effect that all the hard work and huge money that the car brands had invested for all those years to entice me to consider them was decimated in less than ten minutes.

No introduction, no familiarisation questions, no needs assessment, no scenario setting, no credentials, no storylines … This guy needed a skills upgrade and a serious attitude transplant. Perhaps he wasn’t quite losing potential money on a per-minute rate as fast as the trader at UBS, but he seemed to be giving it a damn good go. There was goodwill all over the floor.

Here’s why it matters – from both a brand and a bottom line perspective.

Let’s start with the money. I’ve been doing some work with Feedback ASAP and their research shows that top sales people (those who consistently deliver customer satisfaction scores of 70 -90%) are generating 24% higher sales per hour on average than those achieving satisfaction scores of 50 – 69%.

The guy I dealt with over the weekend delivered an experience that would have been well down the bottom quartile by my estimation. If that happened consistently, that would make him a very low-yielding resource.

As for the brand, three distinct lessons for me from the experience:

1. Investing in sales is investing in your brand – because if the delivery staggers, the promise falls.

2. There is no stop-loss on a bad seller. The damage is done in minutes and not just for that sale. In fact, the cost to the brand keeps accumulating long after the disgruntled customer leaves the showroom. And there is nothing you can do about that. Mystery shop every touchpoint for all you’re worth – because, whether you’re the brand or the distributor, that’s exactly what could be at stake.

3. Look for the leaks because no brand is unsinkable. People who can’t sell or who can’t retain customers are like icebergs on a still night. They may not get your attention, until it’s too late. Run all the numbers, particularly the ones that scare most brand owners. Don’t just run top line analyses, run cost-benefit analyses on all aspects of sales. What are you investing as a brand vs what are your representatives returning in total sales – and by that, I mean in direct sales, in referees, in return sales, in retained business? There’s no point in having great per month income if you’re promptly losing customers or potential customers out the other side via reputational damage and/or churn.

Finding an obsession

When you apply the concept of provenance to brands, it becomes a concept centred on systematically and competitively ‘localising’ what you’re about rather than diversifying to try and meet the generalised needs of the wider world.

So it’s about having a narrowcast brand: one focused to the point of obsession on a specific area of passion. Provenance is also about those other valuable ideas that the word in its original meaning conjures: focus; love; purity of thinking; authenticity; deep knowledge. That obsession can then be marbled through every aspect of the brand: language; environment; innovation; strategy …

People may worry that such devotion to a single idea will stifle adaptability, but my experience is that brands that see the world through the lens of an idea they subscribe to passionately are also able to find latitude and opportunity within that idea whilst growing a strong and devoted following. Far from being restrictive, being obsessive provides a framework for creative approaches.

The way I see it, brands increasingly have three powerful emotive strategies going forward: they can rule the world (scale); they can seek to change the world (activist or cult); or they can kiss the world (obsession).

And all of that drives what you then ask your people and your customers to do. They can get on the motorway. They can get in the bunker. Or they can get in the tent …

Of course there are crossovers. Whole Foods for example combines scale with obsession. So does Red Bull. And BMW. Apple, one could argue, combines all three. And it would be very hard to be a cult or activist brand without obsession. But an obsessive brand can differ from a cult or activist brand because it’s not necessarily fighting anything. It just loves what it’s about to bits. And that optimism and sense of celebration, combined with a just-on-the-verge-of-unhealthy commitment, is what makes such a brand magnetic. That’s what draws the hunters and collectors.

What’s a brand strategist?

There are two answers.

You can be exactly what the words describe. The person who decides what the branding is, what it represents, how it will work and how it will be communicated. It’s a key part of planning effective and inspiring communications.

Or you can develop strategies for brands. You can be a person who works to make brands more valuable, distinctive, profitable and utterly aligned with the culture, the systems, and the distribution channels that must deliver what has been promised. That’s much more about the business. It focuses on making sure companies are utterly competitive through their brands.

Each description involves very different interests, priorities, conversations … even clients.

Just like in any role, a simple change in the words doesn’t just alter the meaning. It can actually shift the mandate.

What do you do?

Brands only work locally

Really enjoyed this piece by Pankaj Ghemawat on the myths surrounding global brands. His point that only 16% of the top 10,000 brands on the Milward Brown database are recognised in more than one country, and only 3% are recognised in more than seven is a reminder that the world is not as open as many of us would like to think. Indeed Professor Ghemawat points to what happened to Coke as a sure sign that Ted Levitt’s principle of increasingly homogenous markets was incorrect.

After steadily pursuing a process centred on standardisation throughout the 1990s, Coke has since shifted almost 180 degrees. Today, the company offers a diversified product set, market-specific price points, localised production and distribution and clear distinctons between the approach it takes in the States and internationally.

And those same principles of distinction and specification that now influence a mass market brand like Coke are extending to other brands looking to build share in markets away from home.

Ghemawat’s advice? Focus on the cultural, administrative, geographic and economic differences between markets – nice acronym of CAGE – and develop specific country or regional strategies to make the most of them.

My take-out? Brands can’t expect to build trust and recognition through arrival, announcement or availability. Brands build engagement by syncing with the context they are sold in, and therefore becoming a part of life in a place. There is no such thing as glocal because you can’t transpose or impose one version of local everywhere. That’s colonialism.

Local is also not geographical, it’s psychological. It’s local if it feels local, regardless of its logistics. It needs to feel aligned, relevant and integrated with a space and the people in that space. Until you’re welcomed as a resident, you’re still a visitor – and no local wants to buy everyday goods from a tourist. What works for you at home works for you at home. What Ghemawat seems to be saying is – leave that thinking there.

Everyone has a sense of home, but those senses of home are very different.

Turning your brand into the authority

In this article in Business Week, Howard Schultz talks about how the mighty Starbucks brand lost its way – mistaking aroma rather than coffee for the core of its business and embraking on a strategy that saw it shift seriously off-course. The problem, as Schultz explains, is that by the time the company realised that they had diluted their brand position, breakfast sandwiches had become 3 percent of the company’s total revenue. Getting back on track was a big call. He did it anyway.

We talk a lot these days about thought leadership – but really, I see that as a component of a bigger objective: market authority. You may or may not want to be the biggest in a sector, but the article says there are three actions that you need to take if you have lost your mojo and, like Starbucks, are looking to re-establish brand authority.

I actually picked up five:

The first decision is obvious – decide what you want to be the authority in as a brand, and keep the faith. Schiltz recognised that while CDs, movies, and breakfast sandwiches all represented revenue streams, they also cluttered stores, diluted the brand and eroded its authority.

The second decision is about doing everything you can to retain and foster that authority. In Starbucks’ case, that meant perfecting new roasts and shutting down every store in North America for an afternoon to retrain its baristas.

Thirdly, stop doing those things that don’t reinforce your authority, even if they were your ideas in the first place.

Fourthly, stay away from the middle ground – because while that common congregating place might be the most comforting, especially in softer market environments, it is also the place you are most likely to suffocate any authority you had in the marketplace. It is the place where you are least likely to cultivate distinction.

Finally, to be the authority, share responsibility for being the authority with the whole workforce: “… make it clear to employees everywhere … that each tiny decision they make is just one more opportunity to passionately and obsessively move the company in the right direction, not the common direction.” Get there one action and one person at a time.

 

Customers or passengers?

It’s amazing who we forget and how quickly. I don’t remember any of the people on the bus last week. Who did I ride home with last Thurday? My mind goes blank. It’s nothing personal – it’s simply that I have no reason to remember them. Or they me.

Exactly the same for most transactions that take place between people and brands. People get what they’re looking for, and then they go.

If you ask the people responsible for running brands what customers they want, they’ll often say “as many as possible” or “people who spend a lot” or this age group or that ethnic group – but that’s not what they really want at all. Because, when probed, they have no idea who they want as customers. They’ll take anyone whose buying. They just want the money.

And yet many of them spend their working days trying to get those very same people to value them above the myriad other offerings. To value them as more than just a price.

As Robert Kozinets has so rightly pointed out, one of the great fallacies about relationships is that brands tend to connect value and loyalty – but customers can actually be loyal and buy very little, or they can buy a lot and not be loyal at all.

So how should we judge a successful customer, and more particularly, a successful customer relationship? What motivates people to put faces to actions?

I think there are 9 sure signs that a relationship between a brand and a customer is healthy, personalised and mutually beneficial:

1. Consistency – there is a regular pattern to how, when and why people buy

2. Integrity – there are no hidden agendas on either side

3. Openness – facts and opinions are shared

4. Humour – people smile at the thought of being in each other’s company

5. Delight – there are pleasant surprises for everyone

6. Confidence – people believe in themselves and each other

7. Time – everyone is given the time they need to do the best work and to make the best decisions

8. Endorsement – names and experiences are shared

9. Value – everyone feels they have got what they needed to get, and more, out of each exchange

If you can remember each of your last three customer exchanges, try marking them against these criteria. If you’re honest, you’ll probably find there’s a spooky correlation between the marks you give and what you actually feel about the relationship with the people involved.

If you can’t remember the last three exchanges in detail, despite what the numbers might be telling you, you don’t have successful customers. You’re just negotiating traffic. And chances are, someone feels like they’re being taken for a ride.

Does efficiency jeopardise brand?

In the hunt for more streamlined businesses that are less resource intensive, how real is the risk that brands are actually putting people off dealing with them? When does an efficient process become so rationalised that it loses its humanity and therefore its appeal?

On the face of it, brand and efficiency have similar objectives. They’re both about creating financial headroom – but of course they approach that goal from opposite directions. Efficiency is so often about what can be subtracted. Brand is all about what can be added, at least perceptually, that people will pay more for.

The problem occurs when the experience is over-compromised in the interests of saving money: when the seats become too cramped; the aisles too narrow; the servings too small; the service too automated … Because it’s at that point, that delight leaves the building, and customers start looking elsewhere because they feel you’re being mean-spirited.

There are, as I see it, two ways to address this:

1. Set very clear customer expectations. If you’re running a high volume, scaled brand, make it very clear to customers why they’re getting what they’re getting. And when you make a change that delivers them perceived greater value, talk about that openly and clearly as well. I refer to this so much because it’s remarkable to me how many brands are vague about what customers are getting that they’re interested in for their money.

2. Make your efficiency drive as invisible to the customer as you can. In other words, focus on adding perceived value where you front customers and removing cost where you don’t. That way, customers won’t feel like they’re being short-changed. But remember that the two are not disconnected. There’s no point in having a nice shop window if there’s no infrastructure to support it.

One idea that I am interested in is the concept of an “efficiency dividend”, where you effectively reward the brand for streamlining by reinvesting a percentage of the savings made. Whilst this may appear contradictory at first, it’s in fact an investment in the long term health of the brand from short-term cut-backs. (I’ve advocated for the same idea in terms of channelling profits into innovation as well.) It helps ensure you don’t just cut the business off at the knees.

How you deliver is your brand’s business. But what you deliver is your customers’. In each case, that’s the party that feels most directly affected. So my three questions are always:

1. What can we add to the experience to make us more competitive?
2. How much is the business going to pay for that? (by way of efficiencies elsewhere)
3. How much more will customers pay for that? And for how long (before it becomes commoditised)?

Cancelling the brand: what has Qantas really grounded?

The ramifications for the brand after Qantas’ decision to ground its entire fleet over the weekend are obvious. It’s a move that has no doubt put tens of thousands of people in a very bad mood and set the scenes in my view for an ongoing internal war that may well prove unrecoverable.

In brand terms, Qantas has done something equally damaging. In looking to force a regulatory decision, it has handed its competitors the perfect bridge: actions that discredit trust; and a prompted opportunity for customers to try out the opposition.

One of the most powerful incentives for change is doubt – that nagging, unrelenting feeling that somehow a brand is not what it used to be, or even worse that it cannot be taken at its word.

The other incentive is access to another channel that is viable, credible and that offers an opportunity to vent emotion.

Both incentives exist here. Meaning people now not only have a reason to walk, they have lots of gates to walk to. Domestically and internationally, competing airlines have been handed the chance to invite disaffected business fliers into their lounges, to convert frequent fliers to their own loyalty programmes, to offer incentives to secure the Xmas travelling public, and at the same time to look very much like the good guy.

There’s never been a better time for competitors to encourage people to fly another way.

I have a feeling this is going to get interesting.

Two leaders kissing. A killer app or a sex tape?

I always grin when people do that whole “any publicity is good publicity” thing. Because it’s simply not true. That observation it seems to me is predicated on a belief that awareness is the doyen of marketing, whereas I would argue that, in most cases, perception overwrites straight recall in terms of bankability.

The temptation, if you follow the former line of thinking, is to assume that successful marketing is just about gaining attention. It’s an attitude that the advertising industry and the online world has done much to encourage. Gain attention and the business will follow. But a sex tape will get you plenty of eyeballs. It doesn’t necessarily mean that you have the foundations of a durable commercial model.

Notoriety does work if your brand is built on a ‘bad boy’ reputation. As I’ve noted before, if you’re Gordon Ramsay, for example, or the Sex Pistols, then outrageous behaviours are both scandalous and intriguing. In these circumstances, people love to be shocked. Antics are in fact part of what people expect and buy into. 42 Below were past masters of outrage as a marketing tool, but the permission to do so was predicated on them being perceived as an outrageous vodka – as outrageous as a vodka from New Zealand in actual fact. Occasionally such brands do overstep the boundary, but a quick apology where necessary – and it’s soon business and brand as usual.

So what to make of the new Benetton campaign “Unhate” that features a number of the world’s leaders smooching? The most controversial of these is probably the Pope kissing a leading Muslim cleric, which quickly got both the Holy See and the imam hot under the collar (sorry!).

Cue: outrage. The official explanation from the Vatican was that the use of the Pope’s image in a commercial setting was an unacceptable use of his image (which probably means copyright infringement or something) and that the faithful would be upset.

Pretty much what you’d expect.

Now what?

Surely Benetton will be banking on the fact that the pushback from the ‘establishment’ to their campaign translates into a viral storm that in turn pushes more people to the racks to express their solidarity with Benetton’s position (the killer app). Just like they did last time with the label’s world issues campaign. But this is a 20 – 25 year old technique and it remains to be seen whether shock alone is enough to make Benetton the force it once was in a sector that is now much more competitive and well used to publicity stunts. The concern must be that the new campaign may gain a lot of attention and swallow acres of media columns but then, just like its sales over the last decade, largely flatline (the sex tape scenario).

As many of you will be aware, I’m a huge believer in a brand having a strong worldview and for that view to be inculcated into everything the brand stands for. In a world packed with bland advertising and me-too claims, I applaud Benetton for once again going out on a limb. The images are certainly arresting. But whilst I’ve always loved the audacity of Benetton’s marketing and refer to them often as an early mover in the bid to politicise consumers, one of my reservations is the lack of a direct link between what Benetton publicises and what it stands for as a brand. How does buying the clothes promote Unhate? Because if there is no cause and effect, the risk is that Benetton have simply linked their brand to a universal (and nicely named) principle, and that principle itself is not that disruptive or controversial, even if its expression is.

We’re talking about world peace, people.

In other words, what makes this more than a universal principle expressed in an edgy way, and why will edginess alone incite a buying frenzy and, even more importantly, sustained and accumulating loyalty in a market that is packed to the changing room walls with talented people and wonderful designs?

It’s a concern well founded. According to the Wall Street Journal Online, Benetton has been losing ground over the last decade to competitors such as Inditex SA’s Zara and Hennes & Mauritz AB’s H&M. The label is struggling to find its place in fashion which is why it has revisited its publicity strategy. The “Unhate” campaign is part of a three-pronged plan to relaunch Benetton’s brand, product and retail network. The label is streamlining its collection and focusing on knitwear and colours—two of the company’s 1980s staples. It is also firming ties with franchisees to better control brand image.

But going back to what worked once is not usually a sign of a brand in charge of its destiny. And as Robert Bean is quoted in the article as saying, “Fashion lends itself easily to pushing boundaries. But one won’t be rewarded just for making controversy. The product must fit the advertising.”

Attention seeking is not a brand strategy.

Attention converting is.

And that’s the real challenges it seems to me for this brand: not just getting the attention (relatively easy), but getting the leverage and being able to link all the kerfuffle back to the brand, what it sells and what it stands for. Turning that attention into bottom-line commitment. Mentions and likes cost nothing – but they earn nothing either.

The media love scandal because it absolutely works for their business model – it sells papers.

It doesn’t necessarily or automatically work for yours.

Lady Gaga’s found a relatively simple way to make that conversion. Gain attention and build intrigue in public – convert that to dollars in album sales and live concerts. The Kimmed One too has managed to do it (actually off a tape ironically), because her business model, it seems to me, is predicated on converting the attention and intrigue generated on TV into what fans buy from a store or what companies pay for live by way of personal appearance fees. But then there’s always the risk, as per the wedding, that outrage tips the other way.

And so, here’s the irony. So many brands let opportunities pass them by because they fail to see the potential in a message or a position or an idea. Because they fail to see that a seemingly ordinary concept has the potential to change their audience, their bankability, their reputation – if it’s handled in an exciting, inspiring and disruptive way … But just being interesting without a clear corridor to the money will not be enough.

Can Benetton turn Unhate into Unbeatable?

We’ll have to wait and see.

Making the most of game dynamics

In a helpful article in Fast Company, Seth Priebatsch provides his insights on how brands can use game dynamics to forge new levels of engagement with customers. He cites three robust principles:

The power of we. Marketers talk a lot about individualising these days, but Priebatsch reminds us that people also find huge reassurance in being part of groups and that creating and motivating such groups can be a game-changer. The dynamics of a customer base change, he suggests, when people see themselves within a group setting rather than just the context of one-to-one. There’s more than group-think at play here. The reason this works, I think, is because communities themselves combine bonding with form and mass which in turn adds the all-important elements of momentum and endorsement. So perhaps a more accurate way of describing this is Seth Godin’s concept of tribalism.

Visible progress. Everyone loves to think they’re getting ahead, and as Priebatsch reminds us, the many progression metrics that brands use – points, status, benchmarks, levels, progress bars – “all help users visuali[s]e and keep track of successes in small increments”. In my mind, progression strategies parallel the ‘upgrade culture’ because they’re all about short-term incremental gains. They’re immediate and they give people small but valued things to work towards. Priebatsch’s advice: “Businesses should constantly strive to devise new and creative ways to allow their customers to visuali[s]e and track their success. Hitting goals and making progress is fun.”

There is a downside of course – and that is that consumers who don’t make the progress they feel they deserve (or would simply like) can feel let down or even abandoned. I remember when I was downgraded on my airline loyalty programme that the drop seemed an awfully long way down. In fact, in some ways, not having them, turned me off flying even more.

Tell me when. I don’t necessarily agree with the examples that Priebatsch gives for his third dynamic, but I absolutely agree with the principle. Priebatsch suggests that having happy hour every Thursday at 5 p.m. is a great example of the appointment dynamic because it “provides reason and immediacy, two ingredients that the customer needs in order to change their behavior.” To me that’s an example of a limited place-and-time offer at work. But the other opportunity here is to establish a habit that people link inextricably with your brand and that may, or may not, be tied to an offer. Starbucks’ third place is a classic example of this type of appointment dynamic because it provides people with a regular thing they can do at a regular time of their day. Coke, too, makes great use of the appointment dynamic, implying that the brand should be included any time that people get together and want to have fun.

Learning 1: Give people something to belong to that enhances their sense of identity. (Association)

Learning 2: Provide carrots. (Incentives)

Learning 3: Look for simple ways to get into and stay in your customers’ diaries. (Priority)

The power of patterns

I have little doubt that news of a study by Facebook and Università degli Studi di Milano showing that Facebook has reduced the degrees of separation from six to four will inspire many to post advice on how and why to push everything Facebook’s way.

According to the study, “99.6% of all pairs of users are connected by paths with 5 degrees (6 hops), 92% are connected by only four degrees (5 hops),” and the average “distance” between users is getting smaller over time.

But I agree with Marc Schiller of Bond Strategy and Influence who pointed out in a recent interview posted on the AdWeek site that the key customer insights in a dynamic marketing environment come with brands adapting to movements in behaviours not shifts in technology.

What really matters here is not that Facebook has reduced the separation between people, it’s that people have continued to employ Facebook to reduce the separation between each other.

If you just focus on the how and not the why, there’s a very real risk of counting the dots at the expense of seeing the patterns.

Absolute quality loses to perceived quality

This post by James D. Roumeliotis and Violetta Ihalainen of Whitefield Consulting, absolutely challenges my worldview as an unabashed meritocrat, but includes some fascinating points – particularly that absolute (objective) quality is far less important for consumers in their decisions about brands than perceived quality.

As the authors explain, “perceived quality” is your customers’ view of the quality of a product or service both in terms of what they expect and also in comparison with how they perceive the quality of competing offerings. That means “perceived quality is defined as a measure of belief”.

So – if consumers believe you are the best, then you are. Regardless of the measures you may put in place. Regardless of what the critics might say. Or the awards you may have received.

For those of us who believe in the power of intangibles, this makes complete sense on reflection but it also contrasts with how we probably believe quality should work – or tell ourselves it does work. “Why can’t they see that our goods are better?” is a question I get asked a lot.

Quality doesn’t speak for itself. It speaks to each consumer in their own particulat way, and the authors quote the great David Aaker, one of my favourite brand thinkers, to explain why.

According to Aaker, perceived quality is generated by each buyer’s perception of up to seven elements. In evaluating these quality elements, consumers literally make up their mind about whether what you’re saying matches the qualities they’re seeing. Just as importantly, these elements are how they decide to choose your qualities over the qualities of others:

If it’s a product, Aaker says your customers evaluate on:

1. Performance

2. Features

3. Conformity with specifications

4. Reliability

5. Durability

6. Serviceability

7. Fit and finish

If it’s a service, Aaker says your customers make quality decisions based on:

1. Tangibles

2. Reliability

3. Competence

4. Responsiveness

5. Empathy

My sense is that further qualifiers then endorse the feeling of perceived quality through inclination – things like the shopping experience, reputation, overall market presence.

In short, people buy when they believe in the value of what they are getting and their focus is drawn away, through critical factors like perceived quality, from the plethora of options available in the market to the one or two products that ‘feel like them’. The challenge for each of us as marketers is to do that in ways that work quickly and profitably and that engage powerfully.

Energy versus focus

Brands require huge levels of energy. They need to be promoted, they need to be maintained, they need to be serviced … just to keep them going. And that can lead some to believe that that is all they need. Surely, if you invest enough energy in this brand, it will succeed.

You see this in those interesting exchanges which begin, “We’re going to spend this … and we want to achieve this”.

I would argue that the emphasis needs to be reversed, “To achieve this, we’re going to have to spend this …”.

There are some important distinctions in the order of these statements. The first emphasises the spend (energy) and ties it, hopefully, to an outcome. The second statement begins with the outcome and attributes a required level of energy to achieve it.

A lot of marketers put their hope in the first approach. Egged on by the planners, they spend up and then wait for the tide to come in. It’s a little like saying that you’ll put a certain motor in a car and aim for it to reach a certain speed. It may work. It may not.

The other approach is much more mechanical. Start with the outcome, and then determine the level of energy required to achieve it, both in ideas and spend. But it’s an approach that makes the creatives and the planners sweat because the emphasis is on actions and results rather than impressions. And it shifts the focus – from “what shall be spent and where?” to “why should that amount (or more) be spent?”

For the most part, the business model of communications agencies is not geared up to make that shift. Their ROI champions the power of ideas and the excitement those ideas generate. A great idea, the argument continues, will require energy to make it work. And when you agree, they’ve made their money. But – and it’s an important but – awareness or even excitement is a means to a return not a result in itself. And until you get the result, you haven’t made yours.

You might like to think about that next time the lights are off and the showreel is running.

Will they or won’t they?

So often it seems to me brand owners hope to bring about change rather than planning to bring about change. They see persuasion as an awareness issue rather than as a behavioural issue – often because they regard their product as the obvious choice that somehow, miraculously will spark a “road to Damascus” moment as soon as consumers encounter it. To that end, they pad out their media schedules with as much presence as their budgets can muster and throw huge amounts of energy and disarming levels of resource into whatever’s trending on social media.

So I was very interested in an article on willpower in the NZ Listener recently that refers to key elements that persuade us to behave differently. It includes some great thinking from David Thomason and the planners at Draft FCB who, like more and more of us in the marketing sector, are looking to the behavioural sciences for clues on ways to shape brands and the behaviours that make brands gel for people.

The article quotes from psychologist Robert Cialdini who decades ago listed 6 key factors that persuade us to make lasting changes:

1. Reciprocity – actions we take based on direct or indirect mutual gain

2. Commitment that can then be carried out consistently – habits, once formed, rapidly become addictive

3. Social “proof” – the power of the crowd to compel the individual

4. Authority – following the bidding of those we perceive as strong, respected or in a leadership role

5. Liking – we’re drawn to, and much more easily persuaded by, people and brands we are inclined towards emotionally

6. Scarcity – making something scarce not only heightens its value, it also elevates its desirability

From this base, Thomason goes on to extrapolate a number of other drivers:

7. The need to display and in doing so to reinforce identity – a phenomenon I often reference as “the handbag of the ego”

8. Framing – the clever use of alternatives to focus buying – usually by making one choice stand out from another as a “bargain”

9. Chunking – breaking big commitments down into small steps

10. Normalising – making activities that had been regarded as unusual or abnormal seem sensible and everyday. As Thomason and his colleague Murray Watt identify in the article, positioning an activity as everyday is actually a highly effective way to overcome inertia and/or indifference.

As the Listener article serves to remind us – brands live in the mind much more powerfully than they do on the shelf, with all the synapsial, behavioural and emotive complications that such perceptions entail. So the key to changing a consumer’s inclination towards a brand, service or action lies in something much more complicated than awareness. It rests on changing their mindset about that brand, service or action.

Most marketers can happily supply plenty of reasons why, in their eyes, customers should change to their brand.

But that’s not the market share-changing question. That question is: why would they change?

Passing the feedback test

Conflict resolution is one of those huge opportunities that so often goes begging. Ask yourself how many times you’ve been in, or watched, this scenario unfold. A client is upset with something that’s happened or has voiced concerns about a brand or some element of the service. The immediate, almost instinctive, reaction is to jump to your own defense; to justify in your own mind why things have happened, and to look to foist that justification on the complainant.

You want to clear your name. Of course. No-one wants to be, or even to feel, like they are in the wrong.

Here’s the thing. As my colleague Janelle Barlow puts it so well in her book, “Complaint is a Gift”, if someone bothers to complain, they do so because they feel emotionally engaged enough with what is going on to interact. The opportunity here is that they are giving you feedback and they are looking for, and judging you by, your response.

Every complaint is a test – a test of your commitment to the relationship, a test of your ability to engage, a test of your people’s patience and self-control. And every response is a test too – of your ability to listen, to empathise, to be charming and engaging, and, above all, to represent and do justice to the brand.

I’m just off the phone and the local Trelise Cooper stockist has failed that test – perhaps not in their eyes, but certainly in mine – after concerns were raised about a service aspect. In response to feedback they had received, they did all the righteous justification stuff to a tee – the curt introduction, the “take control” tone, the barely suppressed anger, the disrespectful approach. I was none too impressed.

And designer Trelise Cooper herself will have no idea that this has happened. She wasn’t there – and I can’t imagine that anyone will have told her. In fact, she’s probably hard at work in her office working on ways to increase the value of her brand and her business.

Sometimes purchases don’t work out, sometimes systems don’t work or don’t work fast enough. There are probably very good reasons why, but for a customer they are actually irrelevant. The thing to keep reminding your frontline people is that logic doesn’t actually determine whether your brand passes or fails the feedback test. What counts is how the customer feels at the end of the call or the encounter.

Here’s the scary bit. Those encounters, those tests, can be incredibly short. Just seconds. And in that time, just a few sentences, a breath or two, some very long-lasting decisions can be made. For or against.

No-one’s asking or expecting the people who represent your brand to kow-tow or to blankly agree with every assertion made by every customer. But knowing how to actively listen to concerns, to calm their own emotions and to find ways to turn things round or at least part on amicable terms, agreeing to disagree, is a brand-critical skill.

Everything about communication today encourages impulsiveness, and everything about prudent brand management mandates just the opposite.

On this day, the temptation to have their say seems like it was just too much for the people in one store. I think they should have been focused on running the brand, not running their mouth. The sad, frustrating and sobering thing is the exchange could so easily have worked so powerfully the other way.

Getting real value from your CSR

This thought-provoking article from McKinsey looks at what really drives value in corporate responsibility. As the authors point out, CSR continues to influence how companies and brands go about their business: carbon footprint, ethical and greener supply chains, volunteer programmes and philanthropy are now all par for the course. We all know that not being involved in such investments can have a negative effect on consumer perceptions, but do the activities themselves add value and if so what are the best ways for companies to make the most of that potential?

“Some investments, of course, produce immediate and quantifiable gains, such as those from recycling or from manufacturing processes that save energy. But often, social investments are expected to yield longer-term benefits as engaged consumers step up their purchases, a broader investor base develops, or new talent flocks to a company’s recruiters … In these more ambiguous cases, how is a manager to know whether stakeholders will indeed respond positively?”

Great question. Personally I’m always suspiscious when someone tells me that there are long term benefits. It can be true of course – it is for branding – but it’s also a very convenient way to fob off accountability. So how can you inject some level of immediacy into your CSR investment?

Let’s start with what you can’t do. What McKinsey’s research clearly shows is that if you are using CSR to hide or ameliorate a lack of quality, then that will actually harm your company’s competitiveness. My take-out from this finding is that CSR is an extension of trust and attention to detail. If you can’t achieve quality with your brand, you can’t expect to play catch-up through your CSR.

There’s also some great advice on how to achieve greater value from your CSR.

1. Your behaviours need to match your words in every aspect. Be straight-up about why you’re engaged in a CSR initiative. In fact, look to directly link your commercial imperatives with your social agenda. That not only makes sense, it shows you are looking to generate social value in your area you know about.

2. Meet your consumers’ true needs. Just as people buy brands to satisfy tangible and intangible needs, so your CSR activities need to deliver an appropriate mix of benefits, and the tangible ones need to be that – grounded, real, measurable and based on a genuine need (not one that you’ve manufactured or would like to address for your own commercial reasons). Better still, find ways not just to get involved, but to actually create programmes that fundamentally address issues and look to do so with others.

One of the ideas that I’ve been thinking about a lot lately, motivated largely by my discussions with Peter Salmon, is that brands probably need to start thinking of their social involvement as part of their innovation programme rather than as something they associate with compliance or stakeholder relations. So, yes, in part that’s about making their products more responsible, but it’s also about looking for ways to apply their knowledge to social problems and then re-injecting those insights back into their product development.

3. Look to create value for all involved, and continue to test that you are doing so. As the authors so rightly point out, “Corporate responsibility acts as a conduit through which companies can demonstrate that they care about their stakeholders. A company should assess its initiatives regularly to ensure that they foster the desired unity between its own goals and those of stakeholders.”

So, are you continuing to be involved in initiatives that your stakeholders care about and that add value for them? If you find yourself involved in an initiative that really strikes a chord with your stakeholders, investigate the business case for becoming more involved. And vice versa.

As products continue to commoditise, there’s little doubt that the intangible aspects that carry more and more of the value in brands are only going to become more valuable. I think at the same time most of us are continuing to grapple with how to do that in responsible and measured ways. McKinsey’s advice in this article further contributes to the resolution of what I see as the elephant in the room for brands and companies looking to lift their emotional margin – “How do we know this is going to be worth it – now and later?”

Seen and not herd

What’s the real cost of the sales seasons on the high street?  That’s the question posed and answered by Laurence Green in this well-considered article in The Telegraph. Green quickly hones in on what he sees as two of the biggest enemies of effective branding today: the impulse to discount; and the compulsion to appeal to everyone that manifests itself in communications that stand out from no-one.

What appear at first to be two completely different issues quickly condense into a single problem.

According to Green, discounting comes at a cost that extends far beyond the lost margin. Their effect, he says, is to slowly unstitch everything that the company has been doing to add value in the minds of consumers across the rest of the year. Indeed Green goes so far as to suggest that “resistance to discounting pressure is one of the hallmarks of a strong brand” and backs up that claim by referring to an address by Mark Ritson of MIT Sloan in which the Associate Professor compared The Gap and Abercrombie & Fitch.

The Gap, Ritson says, has lost its way looking to appeal to everyone, and the permanent “on sale” signs are the clearest sign of that. By contrast, Abercrombie & Fitch has held its premium pricing by staying true to its customer target. In retail, and contrary to apparent logic, it’s actually much harder to appeal to everyone than to appeal to specific groups. Ironically, there’s security in having a smaller but – and this is important – very well defined and understood catchment.

Green clearly sees lack of distinction in today’s advertising as an extension of the same problem. In the bid to appeal to everyone, ideas are “steadily sand-papered into sameness”. By way of proof, he asks what chance David Ogilvy’s “Man in the Hathaway Shirt” would have had in today’s highly researched, highly PC environment. It would have been reduced to a catalogue shot, he says, over a full range of apparent concerns.

Fashion permeates so many aspects of life today that it’s hard not to be influenced by it. There are, of course, many positive aspects to fashion – it changes, it challenges, it directs. But it can also restrict. It can also seem to define. And that can make it very hard to break with. Today’s “it” idea can quickly become everyone’s hope for success. And the result is windows that look the same, offers that sound the same, products that pretty much are the same … And when that happens, when many of the offerings on show are “oh so 2011”, distinctualising becomes a lot more difficult.

The sector quickly becomes a crowd. And the crowd quickly becomes a herd.

In today’s hyper-connected, hyper-aware world, it takes a bold brand not to lapse into sale when everyone has a sale, and not to make shouty boring retail ads that sound exactly the same as everyone else’s shouty boring retail ads. But the risk to brands of doing that is of course far higher than the risk of not doing so – and that seems to me to be Green’s point.
Conforming pulls so many brands into a miasma that not only reinforces more of the same destructive behaviours but appears to give them few other options.

No-one I know has started a brand so that they could just blend with every other retailer in the mall or on the street. They did it because they had a passion for the sector, or because they believed in their talent, or because they wanted to make a success of themselves. Mostly they did it because they believed they could compete and win, and they wanted, as part of that, to be recognised for something and to have pride in what they were doing. And yet that miasma is where too many of them end up – because they lose faith in their convictions. They follow what they think is the market, and that decision quickly lapses into taking cues from others around them.

But here’s the thing – you don’t compete by following your competitors. You compete by responding to your customers.

The next time you’re looking to put the “On sale” sign out, ask yourself this. “Why are we doing this?”. If the real answer is because everyone else is, then you are probably not running your brand, you are allowing your brand to be run. And the need to have sales (particularly regular heavily discounted sales) is a symptom of a more pressing problem – you now mean nothing to the people who buy from you, and you haven’t fixed that.

I’m always amazed by the number of people who say they haven’t got time to go through all that “branding stuff”. But there’s a price to pay for not being very clear about your true value proposition, and the two phenomenon that Green describes are part of that price: you follow the crowd; and you throw your net to wide. The true purpose of an effective brand strategy is to give you the clarity you need to compete effectively. Sale after sale after sale is often an admission that, in the absence of such clarity, you are now willing to sell your brand short. Just like so many others around you.

 

The Balanced Brand: some preliminary thinking

What is it with me and earthquakes? Last Christmas, I was in Christchurch for the Boxing Day shake. This year, I was there on Friday, and it happened again. They are scary – and it’s interesting how different people are scared about different aspects. For most, the fear of death and injury is prevalent as you’d expect – but almost as distressing for others are the noise, the shaking itself and of course the damage that brings silt to the surface, breaks possessions and puts everyone on edge. To all those in Christchurch, including of course my own immediate and extended family, my prayers and thoughts are with you.

We all live with fears I guess, and they come to the surface at different times. That’s as true for business as it is in our personal lives. Today’s obsession with growth has it seems to me often overshadowed the more important strategic question of what do we want our organisations and our brands to grow into – how will they evolve, and how will the benefits of that evolution be effectively and efficiently spread. How will everyone gain something from the strategic change: customers; shareholders; employers; the community?

Business is so linked these days that effects, both positive and negative, are virtually impossible to contain. So I see this as a deeply commercial question centred around holistric incentives and rewards – financial, social and cultural. One that generates tough questions in the bid to find the best answers.

I think there is an opportunity here for brands to think more sustainably and report more holistically (at least to themselves) about their overall returns – not just what they made as an organisation and/or what they gave back, but what were, are and are projected to be the beneficial returns for everyone that the organisation really cares about of the strategy that was pursued and is being pursued.

We talk a lot about intangibles and in some areas of commercial life I think we go out of our way to report them. Yet at a strategic level so often the ways we assess the wider effectiveness of brands is very narrow indeed. Either that, or the assessments are confined by discipline, which really means that one effect is siloed from another.

The conventional response to the relentless demand for growth is to piledriver pressure down supply chains, internal and external, in the name of efficiency and to look for that to blossom into returns.

But I’ve watched many organisations aggressively pursue a scale based model that has kept the people in marketing and finance very happy. Meanwhile the effects of that pursuit are reflected in cultural climate figures that are through the floor or a growing list of supplier casualties who have applied their expertise elsewhere. The true cost of those losses often goes unreported.

The reverse is also true. I have worked with brands that have such a “family feel” that no-one is prepared to bang the performance drum for fear of changing the mood. The point here though is that a workplace that is that comfortable is at risk of becoming complacent.

Either way, the true quid pro quo is lost or at best overlooked.

As the people of Christchurch have discovered, shake-ups force a re-evaluation of many different priorities – from the very personal to the abstractly international. And no one person or entity can make or direct all the changes required.

As the after-shocks of the current financial stalemate ripple through Western economies, everyone will react to what is happening in different ways. Some will indeed take to the cities and raise their fists in fury at the system. Some will look to consolidate. Some will file for bankruptcy. But some may also see this as an opportunity to re-examine the commercial agendas of their brands in a more sustained and broadly ecosystemic way; to look both closely and broadly at the benefits and dangers of the current path and to plot a path forward that generates the best possible advantages for all concerned.

My theories on this, which are still developing, are very much along the lines of Kaplan and Norton’s Balanced Scorecard. The intention is to find ways to develop, monitor and stimulate what I’m calling, at this point anyway, The Balanced Brand.

Best wishes to you all this Xmas season.

Transformation secrets: Please don’t try to change your brand

Change is on everyone’s mind at this time of year – or more particularly people are preoccupied with resolutions of change. Hopes of transformation fly high. But most of us will lapse from whatever pledges we make, not because we don’t really want to change necessarily but because the habit of what we have done or know well is too comfortable for change to endure.

Companies are no different. As Professor Robert Sull put it so well back in 1999 in a paper titled “Why Good Companies Go Bad”, organisations, just like individuals, tend to snub the transformation they really need to decisively shift their reputation or market share in favour of persisting with established patterns of behaviour that they are comfortable with.

Sull dubbed this phenomenon not just as inertia but as “active inertia”, because companies keep themselves busy with activities that, conciously or not, are often directed away from the transformation they claim to want and towards variations of business as usual.

Professor Sull’s point was that such sustained patterns of behaviour degrade in their value and contribution to the business over time. Ironically, the very pillars that are meant to drive progress and support reputation come to act as anchors to innovation and business change as organisations turn inward. Strategic frames, he pointed out, become blinders; processes turn into routines; relationships devolve into shackles; and values transform into dogmas.

As a result, business change programmes become the corporate equivalent of a fight in a paper bag. Everyone’s told they need to change, but most people are left guessing as to what difference these upheavals will make to the brand’s reputation and/or what they are going to get out of all this change. Preferring the devil they know to the transformation they don’t, they opt for inertia.

You can of course try and fight this tendency to look inward (good luck!) or you can draw on it. One very effective way to do that is to take a serious look at the purpose flag under which you sail. In other words, channel the intense internal energy that most companies generate to reset your aspirations as a brand. Reframe your thinking so that the focus is less on ‘what we’re doing’ and more on ‘why would we want to do that’. Taking the cue from Sull, the key issue for most organisations who recognise a need to move on from where they are competitively is not what they are doing or even what they are changing but what they need to become.

After reading Blue Ocean Strategy many years ago, I made this note: “Uncompetitive companies can sell out, tough it out or invent their way out of where they are.”

The last option daunts many, but it’s really not that difficult. It starts with this sentence: “What if we were …?”

Here are my five simple questions to help overcome active inertia and guide effective transformation.

1.  Who do we most aim to be as a company? (What reputation would most excite us as a culture?)

2.  As a consequence of that, what do we most need to do to gain that reputation? (irrespective of what others are doing or what we ourselves have been doing)

3.  As a consequence of pursuing those actions, what will need to change?

And then the simplest but for many people the most telling questions of all:

4. Of all the major projects the brand has running at the moment, how many of them are helping that transformation?

5. Of all the work that our teams have on their desks at the moment, how much of that is helping that transformation?

So many change programmes start with the need to admit failure or defeat. The intention is to make the case for not doing more of the same. But I have watched such sessions quickly descend into a self-absorbing blame game that stirs those concerned to make bold commitments by way of redemption that, subsequently, wither and die under a number of guises.

Despite the promises and reassurances that many will give, if you are uncompetitive, you are where you are for a reason – and “active inertia” may well be your biggest threat. As Marshall Goldsmith so brilliantly observed about transformation, “What got you here won’t get you there”.

But, just like New Year’s resolutions, looking to just make changes, however well intentioned or sincere, won’t necessarily get you anywhere. All you are doing in many cases is entering a very long, dark tunnel at speed with your fingers crossed.

To really succeed, you need to know what, why and where “there” is for your brand, and you need to be constantly and consistently measuring your progress towards that point of purpose, financially, perceptively and culturally.

Change must be a consequence of seeking to become that brand, not the other way round.

Related articles

• Will they or won’t they?

Gazing into the tea leaves

Image via Wikipedia

Happy New Year to you all. Over at Corporate Eye, Susan Gunelius references two JWT Intelligence reports just out that are predicting these five key trends for 2012. Here’s how I see what JWT are seeing.

1. Price Opportunities: Brands will introduce low-cost entry-point products into markets for price-sensitive consumers with “stripped down offerings” and smaller sizes.

My view: Agree. The combination of depressed consumer spending and the rise of house brands will see brands looking to diversify their price points. In many sectors, I think this will be accompanied by diversity in the service experience as well – with online increasingly offering lower prices and help-yourself service levels, and full-price, full-service reserved for physical outlets.

2. Shared Value: Companies will shift from simply donating money to charitable causes to integrating social causes into brand strategies.

My view: Inevitable, and in many ways mandated by both social media and the politicised consumer. Customers will want to see companies doing more than just talking about their social concerns or throwing dollars blindly at a problem in exchange for the feelgood and the publicity. They now want to see CSR applied in meaningful ways that affect real change. Management won’t disagree because this will make CSR initiatives themselves more measurable.

3. Interactivity: With a growing trend toward making screens interactive, brands will focus on finding new ways to engage consumers through touch screens and experiences.

My view: Inevitable. Interactivity may be a experience premium in places at the moment, but its effect is rapidly commoditising as consumers expect more and more engagement. Soon those companies that aren’t catering for highly mobile and tech-savvy consumers will literally be out of touch.

4. Redefining Age: “Old age” is changing with the term focusing on an older audience than ever and a more active older audience. Brands will find ways to better communicate with and target the aging audience.

My view: Yes, but this is just part of the equation. Western populations are not just aging, they are becoming increasingly dominated economically by women. That demographic shift will need to be addressed simultaneously if brands are to make competitive headway. The implications of ‘femonomics’ in particular are far-reaching in terms of even marketing basics like sales models, experience planning and product ranging.

5. Tangible Add-ons: As more content and products become digital, brands will look for ways to add a tangible, tactile experience to those digital products and services and vice versa.

My view: yes and no. As per 1, I think that online will become the DIY access point for a range of products and services particularly in sectors where margins-per-serve are tight. At the same time, it’s easy to see that some digital and physical brands could mirror the developments that are currently occurring in manu-services and look to introduce tangible experiences and services across a range of platforms that add value to what they deliver and at the same time diversify their income bases.

OK, your turn. Drink up please and share – what do you see ahead?

Related articles

• Getting real value from your CSR

   

Human marketing

This highly informative post from James D. Roumeliotis on Customer Devotion introduces to me the expression “human marketing” which I am much taken with. Not only does it speak to the necessity for everyone within the organisation to think and act like a marketer, it’s also a reminder that, ultimately, people deliver some of our most powerful and memorable consumer experiences – and insights.

People have an instinct for people that simply cannot be duplicated any other way.

In the rush to mechanise and socialise, it’s easy to overlook the need for brands to continue to humanise their offering – to make it easier, more enjoyable, more fun etc for people to interact with.

Powerful brands feel human. There is a real sense of people behind what’s on offer. And that I think is Roumeliotis’ key point: you can’t build and run a great brand if you don’t have a culture that loves people – as staff, as suppliers and as customers.

In that regard, while much is made of the need to monitor and track online interactions, the most powerful listening posts most brands have in the market are their people. The critical point here though is that while most people can listen, it requires people who love people to understand what to truly listen for, and what questions to ask in response.

If a client rings and asks about whether you offer online shopping and they’ve never shopped that way with you before, the traditional marketing response would be to offer them information on how to make a purchase through the internet. The ‘human marketing’ response might be to enquire as to why they are interested in shifting to online shopping at this point.

And that’s the thing isn’t it. Metrics don’t talk to motivations. They only show the results of what the motivations have generated – which is why most marketers spend too much time trying to second guess what often appear to be random shifts in buying patterns.

Human marketing is driven by curiosity not just processes. It is about the search for customer happiness via the application of the Feynman principle to every aspect of customer interaction: question everything, especially those things you think you know, including those things you feel you are not being told.

It takes humanity to do that. But just as importantly, Roumeliotis reminds us, it takes everyone to do that, not just the marketing department.

The future of brands: 7 takes from Jim Stengel

Recently, Jim Stengel, the former global marketing officer at P&G, opened up on his blog on what he perceives as the future of marketing. I very much liked what he had to say. My takes and comments.

1. Brands are becoming more important not just as identifiers in crowded markets but also as valuation mechanisms. As Stengel points out, 30 years ago, “almost none of the market capitalization of the S&P 500 could be attributed to brand equity; today it is above 30%.” Stengel sees that as a sign that marketing has become more important. I agree – certainly in the sense that brand can now be visibly seen to add value on the bottom line. I wonder though whether marketing itself has gotten more important or whether it has become increasingly important for marketers (with their heritage involvement in communications) to evolve their understanding of the value, performance and application of brands.

2. Marketing will be more and more about the behavior of the people behind the brand, not what the brand says. Absolutely. Last week’s post about “human marketing” centred entirely on this point. Increasingly brands are judged not just by what they deliver, but how they deliver it – and people are the key component in delivery. If your human marketing doesn’t cut it, nothing else will compensate.

3. Marketing will integrate and synthesize with other disciplines. And vice versa in my view. The globalisation of markets is being clearly mirrored by the globalization, convergence and integration of functions. Delivering “on brand” now involves not just everyone – human marketing again – but almost every aspect of the organisation’s intellectual and operational arsenal.

4. Competitiveness will increasingly be right-brained in its orientation. Stengel’s own words: “Empathy and artistry will get more important. Empathy is at the heart of marketing because it is the ability to see and feel through someone else’s perspective. Artistry is the intuition and creativity to invent something that offers something new and important for a customer” Yes. Yes. A thousand times yes.

5. We’ll all know more, so we better make sure that, as brands, we understand more. Hadn’t really seen the full implications of this one I have to say, but Mr Stengel’s absolutely right. “Big data and advanced analytics will profoundly impact how well we understand our business.” We tend to hear so much about the privacy concerns of big data, but this marketer’s point that it will also yield big insights is very true. The key seems to lie in what brands do with all the information that will flood their way. Those who percept and act will swim and win. Those who try to filter and wait will drown or be swept away.

6. Great brands will continue to “[upend] the business model”, questioning and reframing the frameworks, zones and channels within which they do their business. And they will do so, not for innovation’s sake, but because the changes they make to the ways they are organised will bring them closer to consumers. Great point, well made.

7. Finally, marketers will need to become more nimble and adaptive in how they present their brands and associated messages to communities of consumers who are no longer at their desktop. Instead those people will, in time, be moving rapidly, impatiently and individually, through areas of a city or town that they are highly familiar with. Getting their attention, remaining part of their conversation and attracting them to engage will require new approaches and new ways of thinking about media. Stengel quotes Eric Schmidt in saying that the future for brands will be “social, local and mobile”.

Plenty for all of us to think about here as we power into 2012.

Rethinking the response

There’s a simple, human reason why behaviours happen time and time again in my view.  We are creatures of habit and familiarity. It is much more comforting to keep hammering away at what we know than it is to stop, reappraise the problem and completely redesign the playbook.

Relentless speed and ubiquitous impatience have spawned an approach to strategy based on “not enough time”. The underpinning philosophy is that there’s either not enough minutes in the day to do the thinking, or even if these can be found, the strategy will be outmoded by the time the company gets to implement it.

Wrong. It will almost certainly take far less time to strategise the road ahead than it took to get into trouble. And it will cost a whole lot less than reacting to another bad snap decision.

However, those who hate change can always fall back on a simple tactic. If in doubt, raise more doubt …

“What if it doesn’t work?”

“But it’s not working now.”

“OK, what if it works even worse?”

We’ve all been in those meetings.

For the action-addicted, it is much better to tweak what you are doing based on precedent or aversion. “We’ll move when they move.” Or “let’s just wait and see shall we?”

And we’ve all been there when money and time have been spent acting out “answers” that simply don’t stand up to analysis. The answers fail, because they’re not real answers. They’re actions based on reaction, impatience and subjectivity.

Or they are inactions – initiatives that are so  cautious that they advance nowhere and therefore change nothing.

Further reading

• Market leadership: you can’t lead as a brand if you follow another brand.
• “What are we going to do?”