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Archive for the ‘brand valuation’ Category

This. Is. Brilliant. Every time someone does a piece like this, I find myself grinning ear to ear.

First, some attribution: The piece, published by www.boredpanda.com is tagged as a guest post by Dario D., who first published his images on his own site www.alphaila.com. I recommend that you check them both out for the full feature. Well worth a few minutes of your time.

The premise (from Dario):

So, I went to some fast food places (I won’t say “restaurants”, just “places”), and picked up burgers/tacos, so I could compare them with the ads.

I brought the “food” home (different stuff over 3 nights), tossed it into my photography studio, and did some ad-style shoots (with pictures of the official ads on my computer next to me, so I could match the lighting/angles/etc).

The result, of course is a set of gems (go see them all) that includes this other killer side by side dose of reality:

Dario goes on:

Don’t ask me how this advertising is legal. […] I happily pitch the idea that lawmakers are committing a crime against us people by allowing us to be continually insulted by this advertising […]  in defiance of human perception.

He has a point. The pictures don’t lie.

Compare this kind of advertising to anything else: Cars, candy, clothing, drinks, watches, laptops, tennis rackets, video games, etc.. Most products, when depicted in photographs used for marketing purposes are pretty close to what you can expect to get. In this particular industry, however, not so much.

Remember the scene from the movie “Falling Down,” back in the post Reagan 1990’s, in which Michael Douglas’ character (as mentally imbalanced as he may be) throws a fit over this very affront to human intelligence. Fast-forward to 04:06, towards the end of the clip to see what happens. Take a look:

If you have time, watch the whole scene from the beginning. It’s a classic.

The lesson here isn’t that false advertising exists, or that fast food companies are sometimes unethical with their marketing. The lesson is this: Promises matter. The degree to which customers’ expectations are met is the currency by which a brand’s worth is measured. In the era of social media, global word-of-mouth, and in markets where the abundance of choices can send yesterday’s market leaders careening into a pit of obsolescence, the foundations upon which you build your brand’s future cannot be based on institutionalized broken promises. Breeding cynicism about your products is just not good policy.

Now apply this thinking to your business. Put your marketing through the same test. Does it pass muster, or like these images above, is there a gap between promise and delivery?

Now ask yourself this: Which do you believe is the better choice to build a sustainable brand: Disappointing customers, or delighting them?

PS: Social Media “gurus,” consultants and “certifying bodies,” take a long hard look at what you are selling, and how you are selling it.

Cheers,

Olivier

Additional resources: This post’s grandaddy (click here).

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BRAND DOOM GAME

Design For Users‘ Kristi Colvin (@kriscolvin on Twitter) had some pretty powerful brand management advice recently that is well worth sharing here. Check this out:

The heart of a brand, like that of an individual, is vulnerable. It must be both soft enough to prove genuine caring, and strong enough to withstand scrutiny and adversity. But it is your core offering – not your products and services – and if you aren’t in touch with and know what’s in the heart, establishing lasting relationships with customers will be difficult or hit and miss. Do you want a shallow relationship with the people that interact with your brand, or a sympathetic bond that can withstand conflicts?

The connection between brand loyalty and a healthy bottom-line being what it is, I can’t really think of a better question to ask a CEO or brand manager every time they come to a strategic crossroads.

In other words… This type of introspection isn’t just something company execs should go through once a year or at the start of every new business cycle, but rather every single time a decision needs to be made within the company.

(I am already hearing the question germinating in your brains: What if hundreds of decisions have to be made every day? My answer to you is simple: Once a day or a thousand times per day, there is no difference.)

If you’re looking to save time, feel free to distill the question down to its core: “What would our customers want us to do?”

You just can’t go wrong with that kind of mindset.

Look at it this way: There is absolutely no decision anyone can make within a company that this question cannot be applied to. None. Why? Because every decision you make impacts your relationship with your customers. The software you use. The way you answer the phone. The speed with which you respond to complaints. The way you design your website. The way your product is packaged. The way you treat your vendors and partners. The people you hire. The people you promote. How clean your bathrooms are.

Everything.

Every time you are considering a new hire, ask yourself: “What would our customers want us to do?”

Every time you are considering cutting cost out of your model, ask yourself: “What would our customers want us to do?”

Every time you are about to respond to a crisis, ask yourself: “What would our customers want us to do?”

(Ideally, you want to be able to ask them directly, but that will have to be the topic of another post.)

Once you get into the habit of addressing every question, every problem, every crisis in this way, life gets a whole lot easier. Suddenly, you find yourself not needing to set up so many meetings. You find your reaction time greatly enhanced. You find that taking your ideas to market takes a whole lot less time.

You also find that you don’t have to work quite so hard to earn more business (new and repeat business).

Again, from Kristi:

“Engaging people from the heart of your brand, being vulnerable and forging true and lasting customer relationships are what will keep companies alive and thriving through good times and bad times.”

This isn’t touchy-feely rhetoric. This is as real as it gets. It’s how Starbucks used to do it. It’s how Zappos does it. It’s how the next generation of firebrands will do it.

And if you still aren’t convinced that what you read here today makes good business sense, here’s another question you might want to ponder: If you don’t do what’s best for your customers today, what will your customers do?

Everything you do either gives your customers a reason to do business with you or do business with someone else. There are no neutral-impact decisions.

Don’t give the other guy a chance to eat your lunch.

Don’t give the other guy a chance to earn a better reputation than you.

Don’t give the other a guy a chance to write your eulogy when you finally find yourself circling the drain in what used to be your market.

Even if you don’t buy the whole “higher calling” thing we’ve been talking about lately, understand that your customers are constantly judging you and THEY care. Being better, friendlier, easier to do business with is just good business. Treating your customers like cattle when so many other choices exist for them now will get you nowhere fast.

Have a great weekend, everyone! 😉

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1235991697_e4f2b25ba1_o

Here’s a sobering little bit of reality:

“A study by Bain & Company found that 80 percent of companies surveyed believed that they delivered a “superior experience” to their customers. But, when customers were asked to indicate their perceptions of the experiences they have in dealing with companies, they rated only 8 percent of companies as truly delivering a superior experience (James Allen, Frederick F. Reichheld and Barney Hamilton, The Three “Ds” of Customer Experience, Harvard Business School Working Knowledge, accessed Nov. 7, 2005). Do you sense just a little bit of disconnect?”

(Thanks to John Winsor for catching this some time ago on Seth Godin’s blog, who himself had wisely nipped it from Jim Barnes.)

8% vs. 80%.

… Which is probably the same percentage of companies thinking their advertising, marketing, PR or Social Media “efforts” are solid vs. what the rest of the world thinks of them. (What some of us like to refer to as “reality.”)

Delusion to the nth degree.

By the way, statistically speaking, if you are reading this, you are 10 times more likely to be in the 80% group than the 8% group. Don’t blame me for the bad news. It’s just basic math.

A few pointers to help you figure out where you stand:

If you haven’t seen continuous double-digit growth for the last three years, you are NOT in the 8% category.

If you don’t know at least 10% of your repeat customers by name when you see them, you are NOT in the 8% category.

If you don’t know exactly how many people mentioned your company’s name on the web since the start of this month, your are probably NOT in the 8% category.

If you find it painstakingly difficult to get trade publications to write positive stories about you, you are probably NOT in the 8% category.

If your customer service people yell or complain more than theysmile or laugh when they get off the phone with customers, you are NOT in the 8% category.

If your executives are not being invited to speak at industry events on a regular basis, you are NOT in the 8% category.

If your customers are increasingly pressuring you to lower your prices to match your competitors’, you are NOT in the 8% category.

Starting to get the picture?

Time to do something about it, perhaps? 😉

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image by andrew testa

image by andrew testa

Welcome to episode #2 of our weekly series now, where I feature a handful of my favorite posts, articles, studies or websites discovered via Twitter. (Or as I like to call it: It’s Friday and I have too much work to do before the weekend to actually write a meaningful post.)

To start us off, via @armano (David Armano) is this incredible FEED piece by Razorfish’s Garrick Schmitt and Malia Supe on brands that are getting it right:

When we think back on the relationships we have with brands, it seems that the ones that run deep are the ones where we are emotionally or rationally invested in the brand. Whether it is a running shoe, a favorite beer or even a hotel chain, there are some brands that matter to us and that we choose time and time again. The reasons for our loyalty differ and in some cases the relationship is built over time through experience while in others it is love at first sight. But for today’s marketers creating loyalty or even preference with consumers is a difficult task – one that is increasingly challenging.

The sheer number of brands vying for attention is overwhelming.  Old brands, new brands, celebrity brands, corporate brands and even country brands are all hawking products that in many ways are very similar to products we have already seen and may already have. Marketers keep trying to drive differentiation for products (that are often at parity) with messages we have all heard before.

Digital has also made marketing more complex. For one, it has splintered broad, traditional and easy to navigate channels into micro channels or micro interactions that are built for people not advertisers and their ads. Digital has also fundamentally changed how we view media. It is no longer a channel but rather an entity in itself – something we don’t just watch or read but create, participate in, or share with others.

And lastly, influencers are everywhere – disrupting the most holy of conversations – the one between consumers and the brand. These influencers are impossible to control (much less influence) because they are everywhere and everything and they aren’t necessarily consumers – they are media, other brands, products, design, culture — all the fluid forces that surround the world in which the brand lives.

So what’s a brand to do? (read the entire post…)

That one’s going to be tough to beat, but let’s give it a shot. Let’s see…

Via @guykawasaki: Advertising Age’s “The difference between building a business and building a brand.” A pretty interesting take on brand valuation through market share:

What’s the most reliable measure of the power of a brand? It’s not making the Interbrand list. The most reliable measure is market share. Powerful brands dominate their markets.

In the U.S., Tabasco has 90% of the hot-pepper-sauce market. Campbell’s has 82% of the canned-soup market. TurboTax has 79% of the income-tax software market. Starbucks has 73% of the high-end coffeehouse market. The iPod has 70% of the MP3-player market. Taco Bell has 70% of the Mexican fast-food market. Google has 68% of the search market.

When your brand dominates a market, it is in an exceptionally strong position. In a mature market, a dominant brand is highly unlikely to ever lose its position. (Think Kleenex, Gatorade, McDonald’s, Budweiser and many other dominant brands.) […]

You can’t dominate a category if you expand your brand into many other categories. You can only dominate a category by keeping your brand focused. (Read the entire post…)

Via @conversationage (Valeria Maltoni), Hello Viking’s Tim Brunelle argues against growth:

I’m beginning to think we’ve reached a point where advertising as it is currently practiced has become an exercise in futility—not unlike some aspects of the current credit crisis and the bailouts. Is there an apt metaphor in the unraveling credit markets to describe what’s happening in advertising?

[…] We have reached a saturation point here in the U.S. where more messaging growth doesn’t mean anything more than more advertising. I sense the budget-holders might agree. Noreen O’Leary’s recent piece in Adweek, “Ad Industry Preps for Pain in ‘09,” notes, “Even the quadrennial stimulus of the Olympics and presidential election couldn’t boost spending this year in the world’s largest ad market.”

What’s needed are fewer ads, and greater “development,” which I define as relationships, community and consumer empowerment. As Daly points out, “If economists really believe that the consumer is sovereign then she should be obeyed rather than manipulated, cajoled, badgered, and lied to.” (Anyone hear echoes of Howard Gossage and David Ogilvy?) In other words, let’s cut the growth of blunt messaging and focus (i.e. limit) our persuasive efforts towards developing more robust conversations with our audiences. (Read the entire post…)

Via BryanPerson, by way of @Armano: IBM’s social computing guidelines. Great little document for any company to look at when considering developing Social Media guidelines for their own employees:

… We believe in transparency and honesty. If you are blogging about your work for IBM, we encourage you to use your real name, be clear who you are, and identify that you work for IBM. Nothing gains you more notice in the online social media environment than honesty—or dishonesty. If you have a vested interest in something you are discussing, be the first to point it out. But also be smart about protecting yourself and your privacy. What you publish will be around for a long time, so consider the content carefully and also be judicious in disclosing personal details. (Read the full document here…)

And finally @marenhogan’s (Maren Hogan) brilliant discovery of the latest technology in Social Media. This is going to be HUGE! Check it out.

Honorable mention:

Cory O’Brien’s Lifestream

Via @shannonpaul: Google Reader for Beginners

Via @nicheprof: Plurk vs. Twitter

Via @Armano: “What is Online Authority, really?

Via @karllong: “New rules for building brands…”

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For a little while, the folks at BrandPerspectives.com had a great little blog on Branding. They haven’t posted to it in a very long time, but some of the stuff they did post there is still up and well worth a look, so go check it out.

One of their last topics dealt with Developing a Culture of Brand Performance Accountability (which… was actually the title of their post. Ahem.)

Here’s the meat of the post:


“Just as with financial performance, measurement is critical to
improvement for brand initiatives. Creating a culture of measurement-driven
brand assessments will help executives better understand how to derive the
greatest return from their investments. (…)

Simple steps based on increasing your understanding of your
customers, and their interactions with your brand, can be implemented through
ongoing research.

For instance, the ability to quantify gaps in organizational alignment
behind your brand, or discontinuity in the customer experience (including
metrics such as loyalty, drivers of satisfaction, service levels, etc.) by
segment, region or product, can – and do – have profound impact at the executive
level.”

There you have it. Too few companies focus on assessing where their brands stand… And it’s obvious which companies do it, and which companies don’t. For the first batch, think Starbucks, Whole Foods, Target, Apple and Virgin, for starters. In the other batch… well… throw-in the companies you’ve never heard of.

There is, however, one thing that struck me about the post. In its original version, it mentions (customer) loyalty twice. Hmmm… Loyalty… That tricky little word.

There seem to be two schools of thought in regards to customer loyalty, these days: The first believes in it. The second thinks it’s dead. Both sides have very smart and insightful things to say on the subject. But… who’s right?

Is there such a thing as brand loyalty anymore?

The answer is yes. Absolutely. Think sports teams. Think Ford vs. Chevy. Think Playstation vs. X-Box. Think Apple vs. Microsoft.

Think dog people vs. cat people.

Think Republicans vs. Democrats.

Yeah, brand loyalty is alive and well. But unless you have two superbrands battling it out and inviting you to take sides, forget it. There’s no such thing. It doesn’t exist.

Without the element of archetypal supercompetition, without a corporate nemesis, brand loyalty is simply irrelevant.

Here’s a simple example: Most people love Google… Most of the searches that lead people to this blog come from Google. But because Google doesn’t have an arch-nemesis, no one is driven to be loyal to it. People simply use it. Loyalty isn’t an issue.

What you might mistake for brand loyalty is a lot more likely to be about customers’ habits, penchant for convenience, and comfort.

Remember that customers are people. People like patterns.

Once customers find something they like, something they can incorporate in their routine, that’s exactly what they do. Even I, Mr. Agent Of Change, Mr. Try Something New, shop at the same stores regularly. I read the same blogs. Return to the same TV shows every week. Hang out with the same friends. I even like to get gas from the same places.

You get the drift.

We’re humans. Ergo, we are creatures of habit.

Here’s how it works: You have your routine. One day, your routine gets disturbed. You alter it and try something new. (The store was out of your usual brand of olive oil and this forces you to buy another brand. Your favorite airline doesn’t have any flights available, so you have to book with another one.)

Outcome A: You like the new brand better and adopt it.
Outcome B: You don’t like the new brand better and return to your usual one next time around.

In other words, it takes a significant event for us to CHANGE our habits.

It takes a catalyst.

That catalyst could be a glowing recommendation from someone we trust. It could be a really cool ad. It could be the result of an unexpected shortage in the original product. It could be an accidental discovery. It could be the influence of a cultural phenomenon.

Check out the wheel of brand interaction. What it shows is a complex but repetitive pattern of purchasing behavior. The slinky-like spiral is a brand exposure/interaction pattern we go through either daily or weekly. Some brands are closer to our comfort zone (and lifestyle) than others. (Some brands, we have only superficial contact with, while others we have regular contact with.)

Occasionally, a catalyst will force one of the tentacles of slinky-like spiral pattern to either shift, or reach out a little further than normal.

Marketers spend most of their time focusing on designing some of these catalysts: Think POP displays. Advertising. Package design. PR. Promotions. Coupons. “Branding”. “Co-branding”. Licensing. Sponsorships. Establishing a presence at trade shows and special events… or just across the street from your office. Sampling. Buzz marketing. Giveaways. Swag. New product features. New product styling. New technology. Special edition releases. You get the idea.

It’s kind of a three-tiered cycle:

Phase 1: Building the brand’s contextual foundation – The idea is that exposure to brands will make us more likely to incorporate them into our routine. Familiarity, after all, breeds trust and comfort. (As in “oh yeah, I’ve never tried it, but I know that brand.”)

Phase 2: Triggering the change in purchasing habits – Give people a reason to try your product, and make it easy to do so. (Note: Some companies purposely bypass Phase 1 and focus their energy on impulse buyers.)

Phase 3: Cross your fingers and hope the product is as good as you claim it is. You only get once chance to make a good impression. The best marketing in the world won’t save you if your product isn’t everything it’s cracked up to be. Read ground zero brand-building to know what I mean.

People buy what they know, like and trust. They also tend to crave what they think will make their lives better. (That could be a red BMW convertible or a chrome-plated iPod or a new pair of Rudy Project sunglasses.) More often than not, purchasing habits are based on perceptions, expectations and experience, not loyalty.

Put simply, we tend to buy what we know only until we find something we like better. Brand loyalty is really brand comfort.

So the question you have to ask yourself is this: What are you doing to make your customers not want to consider switching over to other brands?

(Or if you’re trying to attract new customers, what are you doing to make your competitors’ customers want to consider switching to you?)

Does your brand evoke the same level of excitement and customer comfort as Target, Starbucks, Apple, Whole Foods and Virgin?

If not, why not?

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illustration by Tom Fishburne

illustration by Tom Fishburne

The value of being ordinary is exactly zero.  Here’s what Tom Fishburne has to say about it:

“Blending into the herd” feels like one of the most common responses to the recession.  2009 is full of so much risk on its own, businesses are becoming even more risk adverse than usual to compensate.  The first projects to get cut are the speculative ones.  Many companies are pulling back on innovation as a way to batten the hatches.

This defense is illusory though.  If anything, retailers are facing even greater pressure to rationalize their shelves.  Redundant products are in danger of getting cut.  Consumers are shifting to cheaper private label if there’s no compelling reason to buy branded products. Differentiation is more important than ever.

I think this climate creates a lot of opportunity for brands that are willing to try something new.  The ones that can adapt the quickest and offer something truly unique have the potential to not only survive, but thrive.

Amen.

Not that there isn’t value in commodity products. (Check out the crowds at Wal-Mart and Costco.) But not every brand is a commodity brand. Not every company’s model meshes with the 99-cent value meal. And for those millions of companies – big and small – for whom being in business is about more than offering the cheapest product on the market, differentiation matters. If grabbing wallet-share was a struggle before, it has now become a knuckle fight to the death. Being better, smarter, faster has now become a matter of survival.

And kids, being better, faster, smarter takes a lot of work. And deliberate focus. It doesn’t happen by accident. Likewise, it sure doesn’t happen by “blending in” or “Playing it safe.” In this economy, value isn’t just your competitive edge, it’s your lifeline. The more unique you are, the more outstanding your value, the greater your opportunity to thrive in any economy – perhaps particularly a distressed one, when clients and customers are particularly careful when it comes to how they choose to spend their money.

Standing out has its advantages: When you stand out, you stand for something. When you don’t, you stand for nothing – and there isn’t much value in that.

Think of innovation and differentiation as your double-sided ticket out of this economic mess. Companies that will create unique value, unique products and unique experiences will lurch ahead, while companies that focus on trying to survive by contracting and blending in with the masses will be lucky to last the year.

After all, then the going gets tough, the tough don’t wuss out and blend with the herd.

Have a great Monday, everyone.  😉

(Hat tip to John Moore for hooking us up with this via Twitter.)

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Buying a product. Bringing it home. Taking it out of the box. Pressing PLAY. Turning the first page. Pulling the cork. Clipping-in. Hitting the ignition. Biting into the first slice. Slipping into it. Walking into the new store. Spraying it on. Plugging it in. Connecting the pieces. Reading the owner’s manual. Shifting up. Writing your name on it. Clicking SEND on the order form. Taking it for a spin. Just looking at it. Sharing it with a loved one. Holding it in your hand.

It should always feel like this.

It doesn’t matter if you’re a restaurant, a store, a website, a bank, a doctor’s office, a manufacturing plant or a creative firm; ask yourself this: Is the work you are doing today going to have that kind of effect on your customers? On your clients? On your fans?

Is your work really going to connect with the people you are doing this for?

Are they going to fall in love with it? Is it going to impact their lives? Is it going to inspire them? Make them smile? Wow them?

When they talk to their friends about you, will it be with awe? Will they be singing your praises?

Are you a lovebrand? (Incidentally, check out Lovemarks.com. Interesting little concept.)

If not, stop what you’re doing. Put your pen down. Look around you. Think about why you’re there, sitting at your desk. Think about the project you’re working on. It could be a product launch. It could be a new menu. It could be a new floor display. A promotion. A party. A speech.

It could be anything.

Remarkable always hits the mark. Lovebrands always win.

The key to becoming a lovebrand is simply to love your customers first. I mean… seriously. Love them. Fall in love with them.

I’m not kidding.

Read Peter Drucker’s words in yesterday’s post about purpose.

If you’re a coffee shop, love them enough to give them the best cup of coffee they’ve ever had. If you’re a retail outlet, give them the best shopping experience they’ve ever had. Love them like you love a best friend. Do what you know will make them happy. Get to a point where you truly feel joy and pride when they love what you’ve done for them. When it enriches their lives. When you truly become part of it in some way.

Everything you do should be for them, not for you.

What you do, what your company is about, how you design your products, how you interact with your customers, none of it isn’t about like. It’s about love.

Either you’re involved in a wonderful love affair with your customers and clients, or you aren’t.

That is what fundamentally sets great brands apart from the rest of the crowd: Love.

Talk to a graphic designer about their Mac. Talk to a driver about their BMW. Talk to a photographer about their Canon lenses. Talk to a foodie about their favorite dessert. Love.

So, once again…

Buying a product. Bringing it home. Taking it out of the box. Pressing PLAY. Turning the first page. Pulling the cork. Clipping-in. Biting into the first slice. Slipping into it. Walking into the new store. Spraying it on. Plugging it in. Connecting the pieces. Reading the owner’s manual. Taking it for a spin. Just looking at it. Sharing it with a loved one. Holding it in your hand.

It should always feel like this.

photo copyright olivier blanchard 2005

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