Archive for January, 2009

What’s up with all these sound-alike branding firms?

Someone I know and respect recently joined a branding firm, so I went to their site to check them out.   What did I find there?

I found the same things that I find at nearly all other branding firms.  I was particularly fascinated by the way they all seems to be using the same language.  The following 4 examples were culled from the home pages of 4 different branding firms. Can you guess which phrase goes with which branding firm?  Can you do it without using Google?
1. “Creating brands that transform business.”
2. “Create value”
3. “Building strong brands that drive revenue and create financial value”
4. “Creating and managing brand value”
Every one of these firms goes on and on about the need for brands to stand apart  in the market, to have an ownable point of differentiation.
In fact one of the firms features a new whitepaper they have written about “Differentiation in a Downturn”

Here are some of their key points:

  • To prevent your differentiation from disappearing overnight, keep in touch with your customers and understand their needs and concerns
  • Brand attributes and assets that may be cost of entry in good times become more important as customers look for reassurance from companies they can trust.
  • Cut away neutral brand assets and attributes that have no measurable on your brand’s bottom line.
  • If your brand is in a rut, take the long-term view; but if you follow tips 1-3 you might be able to stop your brand’s decline before it’s too late.

To all of these firms I say, “Eat your spinach!”  If you really believe in differentiation, then why don’t you practice it?  

Oh, and the answers are:

1. Landor

2. Lippincott

3. TippingSprung

4. Interbrand

Everyone wants to be an expert on branding

There is a wonderful book by a man who is The Expert about everything.  Yes, I do mean John Hodgman.  His newest book is titled, “More information than you need to know”  He also has a pseudo-blog, filled with more information and expertise.

I am often reminded of Hodgman when I hear that some person or another is an expert on branding.  If you Google “brand expert” you will get 57,100 listings.  

So many experts, so little time!

I have always wanted to become an expert on branding.  Is there a course, like a PhD program, where you can get a diploma in branding?  If so, where do I sign up?  

Can I simply state that I am an expert on branding?  Maybe I can back it up with some credentials, such as saying that the BBC, the AP, USA Today, Adweek and Brandweek all acknowledge me as an expert on branding.  Maybe I can say that I worked at this advertising agency or that branding firm.  I can claim to have worked on this brand or that brand.  Maybe I just need to have a self-published book with a title like “My Cow Can Eat Your Cow”?

With so much expertise on branding, it’s a wonder that any branding actually gets done.

Bank of Missed Opportunity?

It seems like Bank of America is in the right place at the wrong time.  

For nearly two years they have embraced a brand positioning about opportunity.  

At the same time we read online about their request for a multibillion dollar bailout.  The US government now owns about 6% of the bank.  And there are untold billions more at risk due to the acquisition of Merrill Lynch.  So whose opportunity are we talking about?

From the Bank of America website:

Our Brand Positioning
Bank of America’s brand positioning, “Bank of Opportunity,” is emblematic of what Bank of America has always strived for throughout our history ― to create opportunities for the people we serve. 

It is a brilliant idea that is just completely out of step with consumers today.  

So what is a company to do when their brand positioning has boxed them into a corner?  Do they compound the problem by trying to “reposition” the brand?

This is an example of how the inflexibility of brand positioning can amplify the problems of a company instead of reducing risk.  Unless Bank of America can change the discourse, they run the risk of being out-of-step with their customers.

The reality is that people have memories.  We all understand that the current financial crunch is beyond the control of any bank, even one as large as Bank of America.  What we need is a really good narrative line about what role Bank of America will realistically play in our lives, in our communities, in our country.  The narrative needs to adapt to the reality.  

It also raises a very delicate question.  When companies are receiving billions of government aid, should they be spending any of it on advertising?

What Sam Spade has to say about branding

In my home we are on a years long project to work our way through the high points of movies since the advent of the Talkies.  Getting anyone here to watch a black & white movie is challenge enough, so I’ve given up hope of showing the older silent greats.

Recently we watched The Maltese Falcon.  If you haven’t seen it, you must.

Here’s the key thing to watch for in the movie — the metaphor.  

Why?  Because at the heart of every great brand is a strong metaphor.The metaphor takes on layer after layer of meaning over time.  By using the metaphor in different contexts, it can have great power.

So back to the film noir classic, The Maltese Falcon.  Our anti-hero is Sam Spade, archetype of the hard-drinking, womanizing, private-eye.  The action begins when Spade’s partner is bumped off.  As Sam Spade sets off to find the person who killed his business partner, the black bird takes on layer upon layer of meaning.  What is that beautiful black bird?  It is the endless quest for the Holy Grail.  It is the greed that twists humanity.  It is a metaphor, symbolic language.  

It is a great example of how a metaphor can have great power over people.  And not just the characters in the movie.  Think about all of the people who have been emotionally hooked by this movie.  How Sam Spade and that beautiful bird have entered our sphere of personal stories.

So what does Spade have to say about branding?

It is, in the words of Sam Spade, “The stuff dreams are made of.”

Metaphors and the American consumer

There is a very fascinating study that gives us a window in the minds of consumers during the current economic latke.  It was done by the extremely smart people at Olson Zaltman Associates.  The name of the study is “The US Economy and Its Impact on Americans”.  You can download it from their website.

This study is also a very good introduction to the ways metaphor shape thought.  It is through metaphors that we can shed light on new ideas.  It is through metaphors that we can make sense of the bits and pieces of information in our lives.  Olson Zaltman use a proprietary and patented methodology, ZMET.  It stands for Zaltman Metaphor Elicitation Technique…I think.  

For my fellow writers and English majors, I acknowledge that I have taken some freedoms with the word metaphor.  I am including analogies and similes under the same umbrella.

Where did all the consumer research go? Part 2

In my last post I wrote about my concern that the marketing cutbacks will eliminate much needed consumer research.  Since writing that I’ve heard from friends at two different research companies.  Both report “restructuring” at their companies.  

Seeing those cuts so early in 2009 signals to me that the situation is even worse than I had expected.  

It also signals that there are opportunities for companies who are continuing to understand their customers may gain a disproportionate competitive advantage.

Why disproportionate?  Well, when everyone is doing similar consumer research, they are generally discovering similar things. So nobody has a substantial advantage.  But when only some companies are doing the research and some are not, the playing field is no longer level.

Interesting times we are living through…

Where did all the consumer research go?

Where have all the insights gone?

The numbers and the anecdotes all point to 2009 as the most difficult year in marketing in 80 years. It seems as if marketing is under siege at company after company.   Budgets are being cut, marketing staff is being cut.  It is an easy target because the cuts can go right to the bottom line.  Market research is one of the areas under the scalpel.  Or chainsaw.  Choose your own favorite metaphor.

The risks of not doing customer research appear to be small.  We can all pretty much guess that price has become hugely important, that luxury is going below the radar, that “thrift” has become vogue again and not just for finding really cool stuff in thrift shops.

And maybe some cutbacks in market research aren’t such a bad thing.

I had a boss, Valentine Appel, who used to say that all market research was a waste of money.  Either it tells you what you already knew, so why do it?  Or else the research tells you something different from what you know and it can’t possibly be true, so you throw out the results and retest until you get the right answer.  Either way, market research is a waste of money.

This from a man who is in the Market Research Hall of Fame!  And, yes, there is such a thing.

Maybe it is useful to think of market research as an insurance policy.  It is a small price to pay to know that your business strategy is being supported by your branding strategy.  It is a small price to pay when you need every piece of communications to be more effective than ever before.

What is your opinion?

What does branding have to do with John Maynard Keynes?

In this post I will attempt to show how branding can make a small but important contribution to getting the economy back on the right track.  The essence of my argument is that branding, done right, can stimulate the desires of people to buy goods and services.  

Why is it so important to stimulate the desires to buy, buy, buy?  Allow me a small digression and I promise to answer that question.

The disastrous state of our economy has made the name John Maynard Keynes safe to say in public again.  He was the brilliant English economist who developed the ideas that helped to pull the US and UK out of the Great Depression of the 1930s.  His best known but now little read work is The General Theory of Employment, Interest and Money.

By coincidence I am very familiar with that book, having spent two years studying it under Sidney Weintraub, who had himself been one of Keynes’ students in the 1930s.  

Keynes was very concerned with “Aggregate Demand” — the sum of all our desires to purchase things now.  He recognized that it was possible for a country to fall into a situation in which the demand for goods and services fell substantially below the supply of those goods and services.  The decline in demand meant a decline in supply as companies cut their output and fired people.  This led to more declines in demand.  The downward cycle, once begun, went on for years.  The way to solve it was to stimulate demand.  If the demand didn’t come from consumers and companies, then it would come from the government.  Thus we get stimulus spending!

Keynes fell out of favor and out of the popular mind during the Supply-Side revolution of the 1980s.  Build it and they will come became our new national mantra.  

Today we are back to Keynes’ insight because demand for goods and services is falling.  People are sitting on their wallets.  Demand is dropping for cars, for flat screen tvs, for vacations.  As a result factories are closing down, companies are laying off workers.  

Which brings me back to the point of this post.  

Companies need better ways to create demand.   That is where Narrative Branding can play a role.  Dollar for dollar, Narrative Branding is the most effective way to stimulate the desire for goods and services.  

The reality is that media budgets are being slashed.  Spending more money is not an option.  

Narrative Branding is concerned with the role of a brand in the life of the customer.  By understanding that role, it is possible to create desire and demand in that customer.  

This is not the same as “differentiating” one brand from another.  It is not about the relationship between one brand and another, the position of one brand vs. another.

Only the government has the resources to stimulate the entire economy.

Narrative Branding makes it possible for individual companies to stimulate desire and demand for their offerings.

The 4 methodologies of branding

Sometimes an idea becomes so well-known and widely held that people don’t even consciously recognize it as an idea but simply take it for granted.  The underlying assumptions are no longer questioned.  The idea passes from theory to law.  Consider gravity.  Before Sir Isaac Newton, people accepted that pendulums slow down and that two objects may bounce off of each other.  They were facts, nothing more.  Newton saw a set of fundamental principles behind those facts.

Over time, Newton’s theory became “laws”.  They were seen as sufficient to explain the world around us.  And for many centuries the underlying assumptions were no longer questioned.  Eventually physicists identified some special situations in which Newton’s laws could not explain the observable phenomena.  New theories of physics were developed, several of which are competing with each other.  Space-time physics, string theory, big-bang — all are theories that are vying for our attention and elevation into laws.

The same is true for branding.  For many years, brand positioning was the preeminent theory of branding.  From this theory grew a method for defining, creating and managing brands.   It has several different labels such as Mind Share or USP but those are fundamentally the same method built on the same theory.  It was popularized by Mr. Trout and Mr. Ries in articles and books.  It was widely adopted in academia, ad agencies and corporations.  At least two generations of marketers have known of almost nothing else.

Along the way the way special situations cropped up in which the brand positioning method was not sufficient to explain the success or failure of a particular brand.   So there was tinkering with the brand positioning method, adding a new twist here and there along the way.  But the underlying theory was no longer in question.  And the underlying assumptions were unquestioned, too.  Perhaps the best know superstructure — and most complex — was developed by David Aaker and his co-authors in a number of books such as Building Strong Brands.

Beginning in the mid-1990s several academics and consultants started to recognize more and more situations in which brand positioning was not working as it was meant to.  Instead of adding more complexity to the brand positioning method, they decided to opt out.  They began to question the theory itself.

Today there are 3 additional methods for defining, creating and managing brands, along with brand positioning  The first  method is Emotional Branding, popularized by the wonderfully brilliant Marc Gobe.  The second is Iconic Branding, which was formalized by Professor Douglas Holt formerly of Harvard and current at Oxford.  And the third is Narrative Branding (which is, by the way, also our trademark term) that was developed by me and Michael Thibodeau.

(In this list of the 4 methods of branding I am deliberately excluding some highly specialized methods created by individual companies for their own purposes.  The most famous of these is Brand Journalism, created by Larry Light when he was the CMO of McDonald’s.  Because this is proprietary to McDonald’s, it is not available to other companies.   It is like a hothouse plant, known to survive in the special environment but not tested out in the greater world.)

The questions about brand positioning have only grown over time.  Today the method and theory of brand positioning are being challenged by marketers at major corporations around the world.  In our recent study we found that  nearly 2/3rds of senior marketers are looking for breakthrough methods that are more effective than brand positioning (source: JupiterResearch/Verse Group study 11/08).

Is Brand USA another Banana Republic?

While at lunch today, my companion began to explain how the current economic meltdown has more or less bypassed Central and South America.  The countries there had been through so much economic turmoil of their own over the years that local companies had acquired a certain immunization against the shock.  So the local companies continued to spend on marketing including branding and advertising.

My companion when on to bemoan the situation here in the US.  He observed that US companies are in a state of shock.  They don’t know how to maneuver through economic disaster.  Marketing has been particularly hard hit.   He said that the US has a lot to learn from Latin America.

That got me to thinking.  The stereotype of Latin American countries is a banana republic.  By contrast the USA was the large rich country to the north.   To shed their banana republic image a number of countries, such as Mexico, have undertaken branding efforts to change their image.  They engaged in nation branding.

For many years travel destinations, such as Bermuda or the Virgin Islands, have spun their own brand stories.   The idea of creating branding for travel destinations has gradually spread to other geographies from cities to states to entire countries. This is often known as “place branding” or “destination branding.”

Instead of giving my own definition, I defer to the collective wisdom of Wikipedia for one:

Place branding (also known as destination brandingplace marketing or place promotion) is a relatively new umbrella term encompassing nation branding, region branding and city branding. The term was first developed by Philip Kotler,  and was further researched by Gold and Ward, Simon Anholt, Avraham and Ketter,  Seppo Rainisto, and others. The term “place branding” could refer to a city, country or a tourist destination, and to their competition for tourists, visitors, investors, residents and other resources.

When it comes to nation branding, a good example are the recent campaigns to shape opinion of Hugo Chavez’s Venezuel 

Larger, richer countries have generally not indulged in actively shaping their reputation through the tools of branding.  We can hypothesize several reasons including the already strong reputations of the richer countries and public antipathy to wasteful spending of taxpayer dollars.  

Certainly both of those reasons applied to the USA for many years.  

Then a curious thing happened.  Following the events of 9/11, the Bush administration hired the advertising phenom Charlotte Beers, the retiring chairman of advertising agency J. Walter Thompson.  Her job was to elevate Brand USA.  

How successful was she and the others who followed in her footsteps?  

Not very.  Judging by Simon Anholt’s annual survey, the efforts were duds.  Brand USA has slipped into 7th place while Brand Germany has captured the coveted number one spot.  

You might even say that Brand USA is taking on characteristics of a banana republic.  Our reputation is dropping fast.  We are running huge deficits (actually the deficits are huge numbers but a relatively small percent of annual GDP).  We are seeing the nationalization of major industries such as banks and automotive companies.  High unemployment.  True, the analogy isn’t perfect, but it is useful for understanding our situation today.  

Which brings me back to my lunch and my friend’s observation that US companies could learn a thing or two from companies in Latin America.  Yes, he is right.

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