Posts Tagged 'differentiation'

Mediocrity Wins Award for Near-Excellence in Online Marketing!

Breaking news!

This week we are giving out the First Official Verse Group Award of Near-Excellence in Online Marketing to www.2011Mediocrity.com

Yes, that’s right, 2011mediocrity.com!  A most excellent website which just may perhaps be the most inspiring site I’ve seen since last week.  It’s comfortable beige, clean and uncluttered with strange ideas.

Home of Mediocrity

What I found mostly inspiring is the mission statement.  It’s a keeper, with phrases like, “…mission is to manufacture the most…” “Our company is extremely dedicated and passionate about…” and “each and every day, we strive for…”

Mediocrity on a Mission

So imagine, just imagine, how disappointing I was to learn that Mediocrity isn’t a real company.  Imagine what is is like to feel all of the inspiration slip right out of the room. That is how I felt when I learned that Subaru is Mediocrity.

Okay, okay, it’s not so hard to put it all together that this brilliantly executed piece by Subaru and their agency is meant to convince me that Subaru is the solution to the same-old, same-old copycar cars on the road.  Such attention to detail in a mock campaign is a work of obsessiveness, people who are compulsively driven to bring an idea to lifelessness.

I applaud their (Subaru Mediocrity) risk-taking.  Their brand has been on a strong updraft lately.  In the face of success they are not afraid to try new things in their marketing.

Will it play out well for them in the marketplace?

At the end of the day I strongly suspect that they would be better served by dedicating their resources to positive aspects of Subaru rather than for such an elaborate hoax to tweak other car companies.  It strikes me as a case of looking over your shoulders at the competition when you should be concentrating on the road ahead.  All too often marketing trips and takes a pratfall with campaigns like this.  I’ve seen it happen where one company’s marketing team is so intently focussed on their competitor’s marketing moves that they launch an ad just to tweak the other brand.  It’s almost impossible to resist when you are on the receiving end, so you encourage your agency to retaliate with an ad or two.  Soon the two companies begin to focus their creative energies on ads directed at their competitor.  Thus they begin a hermetic duet, dancing with each other and ignoring the consumer.   The Dance of Differentiation.  Perhaps this is just another one of those flawed-in-conception-and-brilliant-in-execution ideas.

I had a good a laugh and fun.  And so, applause for the First Official Verse Group Award of Near-Excellence to Mediocrity!

This handsome, one-of-a-kind award, is personally signed and suitable for framing.  It will be presented at an impromptu awards ceremony held at the bar in Grammercy Tavern as soon as the winner contacts us.

Different is different – or – The Spy vs. Spy Skool of Branding

You can hardly sleep through a marketing lecture without hearing the word “differentiation” so many times that it begins to seep into your daydreams.

The language of differentiation — giving your product a point of difference that customers will value — has become so pervasive that it is taken as a categorical imperative…With all due apologies to Immanuel Kant.

In theory, differentiation is a lovely idea.  But in reality is highly ephemeral.  From the stand-point of a physical product anything can be copied — quickly and cheaply (particularly if you don’t have to invest in coming up with the idea in the first place).  Well, not everything. For instance, a patented formulation stands a good chance of holding off the hordes of imitators for a good while — at least in North America and Europe.  But that aside, just about any product point of differentiation you can imagine can be quickly copied.

What happens next is the true danger of differentiation.  I call it the Self-Referential Hermetic School of Tautological Reflexology.  In other words, spending more time looking at what your competitor is doing in response to what you are doing and what you will do in response to that.

Example: About 5  years ago I was meeting with the marketing executives of Movilnet, a wireless phone company in Venezuela.  They were positively gleeful as they showed me a new commercial.  The commercial was making fun of their competitor, Telecel.  Why all of the joy and glee in the room?  Because they knew the ad would be taken as an insult by the head of marketing at Telcel.  Millions of dollars in media spending to insult the competitor — without a thought to attracting customers.

I wish that anecdote was a one time case but I have seen it repeatedly around the world.  Looking at the other guy instead of focusing on being yourself and your connection to the consumer. Well, it’s rather like the old Mad Magazine feature, Spy Vs. Spy. It bears little connection to the world of consumers.

Spy vs Spy

Spy vs Spy

Click here to see Differentiation In Action!

Focus on what you have most control over.  And that is the resources and direction of your company.  Real differentiation comes from self-awareness and creating your own path to the future.

The perils of positioning – or – Verizon is reliable, reliable, reliable

Verizon is an excellent example of a company that has been following the brand positioning method very consistently.  For years now they have been very focused on a single attribute: reliable.  They’ve coined their wireless network as “America’s most reliable network.”  

In fact, Nielsen has recently published a study which commends Verizon for this single-minded approach of differentiation through a single attribute.

 

A testament to the success of its consistent advertising message, the number of

consumers who perceive Verizon Wireless as having the best mobile network has shot up over the last

two years and it leads its closest competitor now by an almost 2:1 margin.

 

And what is the benefit to Verizon of this singular focus on reliability?  Well, having a reliable network fell from being the second most important factor to 7th place.  The more Verizon has been focusing on reliable, the more they have been missing out on the biggest shift in the market to the “unlimited” brands such as MetroPCS.

When Choosing a Carrier, Does “Reliability” Really Matter?

This raises the wisdom of the narrow positioning model for brand marketing — at least for major brands who are trying to reach multiple audiences.  

On the other side is AT&T.  They are having a tremendous boost from the exclusive arrangement to carry the Apple iPhone.  This has become more important on an absolute level — although not by rank.  More importantly is that iPhone users tend to use more services and driver higher ARPU (which is industry slang for Average Revenues Per Unit).  That means the new people AT&T attracts will be generally more profitable.

It is ironic that the actual article appears to argue that the iPhone doesn’t really matter.  It does matter, to one small but very influential audience.  For a brand to become mass, it needs to appeal to multiple audiences with different aspects of their narrative.  All these aspects of the narrative need to come together into a coherent whole.  But they  are not narrow, rigid and repetitive attributes.

If the brand positioning model is right, then Verizon will become strongly associated with the attribute “reliable”, an attribute which is falling in importance.  Fortunately for Verizon, there are other models for branding that recognize the reality that people do change their minds about brands.  The challenge will be for Verizon to drop the traditional brand positioning approach and move to a more effective branding model.  It is hard to shake a brand model that has been dominant for decades — it becomes ingrained.   That leaves the door open to newer companies looking for breakthrough approaches to compensate for lower budgets.  And also for AT&T which has a lifetime of brand associations.

 

New consumer research technologies, old research techniques

Okay, it’s old news that in the US and many other countries, market research has moved online.  The new technology makes it possible to set-up and field studies in record time.  And with Zoomerang and Survey Monkey, just about anyone can create and field a survey.

Which brings to mind a simple question:  Are we using new technology to improve the quality of insights or just using it for the same old tasks?  

My observation is that online research is often a missed opportunity to delve deeper into the minds of customers.  

In study after study I see that questions and study design meant for mail, phone or in-person studies are now migrating online.  The same old studies just done in a new medium.  Why is that such a big deal?  Because many of those questions were compromises based on the technology that existed in the 1970s and 1980s.

It’s like replacing an electric typewriter with a MacBook Pro laptop.  A very cool way to type things.  But you could also adopt all of the new technology stuffed into the MacBook and be making videos and other visual presentations that are much more effective.  

The very nature of putting a study online opens up a world of possibilities — ones that should excite both the market researchers and pretty much everyone in marketing.  The past methods and study designs were not meant for the internet age.  Now it is possible to bring visual experiences and images into the process.

Consider for a moment the typical questions about brand awareness.  Currently they are about remembering a brand based on a verbal cues, along the lines of “What brands of xxxxx come to mind?”  “Have you ever heard of BrandX?”  For aided questions, it is just as easy to show the logo and ask, “Have you ever seen this brand before?”  In real life people come across brands visually, logo first.  If I go into a store, I see the brand name in context of a label, a logo, a package, perhaps a point-of-sale display.  So why not in market research?  

For image and brand personality questions, it is now easy to use visual images instead of  checklists of adjectives and attributes such as “Tall”, “Dark” and “Handsome”.  The illusive grail of marketing, “differentiation” is often in imagery and not in product characteristics.  Consider wine. Or beer. Or water. Or perfume.  Or any number of other categories where consumers cannot rationally explain the differences between the physical products. Here’s where the visual aspect of the internet can really delve deeper.

Yes, yes, I know that there are huge problems with online research. How do you know that a real person between 18 and 49 is filling in the survey? How do you actually verify the sample? This is not meant to diminish those issues.  Market research on the internet is here for the foreseeable future, so this is the time to begin making the most of it.

A number is just a number.  But an insight is priceless.  Much of memory is visual.  Much communication is non-verbal.  Much communication is metaphorical. The great promise of market research on the internet is to re-invent market research to get into these visual, metaphorical, non-verbal parts of the consumer’s mind.  The great promise is to get deeper insights.

Okay, I’m putting my soapbox back into the closet for a while…

What is so different about Narrative Branding?

It can be summed up easily.  Narrative Branding is an inductive approach.  Brand positioning is a deductive approach.  

Inductive is showing people a painting and evaluating how much it engages people.  

Deductive is asking people what kind of painting they want to see and then painting it.

Now that might need a little more explanation.

In Narrative Branding we bring new narratives to your audience — consumers, customers, employees.  Yes, it begins with audience.  What we are looking for are the metaphors that resonate strongly with your audience and the stories that they tell.  We do not expect them to provide “the answer” at that point.  From there we create new narratives for the brand by imaging the future.  Then we use market research to see which narrative is the most engaging and compelling.  

Traditional brand positioning begins with deducing what is important to your audience by assessing the world as it is today.  You also want to assess how people view the competition.  From that you isolate 2, 3 or 4 attributes which are both important and different from the competition.  The last step is to put those attributes into a verbal positioning statement that is researched, although the words in the final statement are not mean to be used in the marketplace.  Then the positioning statement is handed over to the creatives who are responsible for translating these attributes into the new branding.  

We can go back and forth all day about the merits of one method vs. another.  At the end of the day we come back to the fact that 63% of CMOs and other marketing decision makers want a method that is more effective than brand positioning.  

Marketers unsatisfied with brand positioning

 

And that those who are looking for better methods are much more likely to be using or exploring the use of brand stories and storytelling.  

Marketers are embracing brand stories

This is not my opinion.  This is not the opinion of another branding expert or a branding agency.  This is the opinion of marketers who use these methods. And theirs is the opinion that counts.  The evidence is in the JupiterResearch (now Forrester Research) study conducted six months ago.

What are advertisers reading?

We hope that they are reading the views and opinions of other advertisers which are included in our article just published by the ANA.  You can find it at the ANA’s online publication, TheAdvertiserMagazine.com.

Increasing numbers of marketers are ready to move beyond the traditional brand positioning model.  They recognize that it doesn’t work for them any longer.  They are gravitating toward compelling narratives with strong metaphors as a better method for branding.  

This sea-change in branding is being led by CMOs.  Agencies, in general, are lagging behind clients in this instance.  You need only look at the websites of the major agencies to see the prevalence of “brand positioning” — in its many flavors — to recognize gap between what clients actually desire and what agencies think clients desire.

By the way, in this context ANA refers to the Association of National Advertisers.  

The confusions caused by abbreviations of associations are quite common.  Imagine you are working in pharmaceutical marketing. The AMA could refer to: The American Medical Association or The American Marketing Association or even The American Management Association.  One could write an entire doctoral thesis around the need for humans to turn everything into an acronym or acrostic.

Is benchmarking other brands useful?

A standard part of the branding process is to look at “best-in-class” case studies and benchmarks.  This is a combination of a competitive audit along with an audit of the brands that are most admired or selected by some other objective criteria.

Some people believe this is provides a yardstick for clients to measure their own branding against.  And for many years I was of that opinion, too.  

But then I began to observe a curious set of circumstances which make me skeptical about the usefulness.  The names of companies and brands will be left out, to protect the usual suspects.  

Let’s start with Company A.  Company A asked us to do a best-in-class benchmark study on the brand management organization and practices of 10 other companies.  My team set about that project and developed a set of benchmarks which the client could use as they were revamping their own branding organization.

About a year later one of the companies on the 10 best list requested we do a project for them.  I will call them Company B.  They asked for a similar “best-in-class” benchmarking study as was done for Company A. The only difference is that for Company B, they wanted us to study Company A as one of the 10 best list.

Not long after we were approached by Company D.  They too wanted a brand management benchmarking program that included Company A and Company B in their list of 10 best.

I am sure that you would have seen this pattern coming long before I did.  What to do when all of these world-class companies are so busy benchmarking each other?  Doesn’t it become a self-fulfilling prophecy?

These world-class companies don’t just benchmark on branding.  They hire world-famous management consulting firms to benchmark other world class firms on a variety of areas.

By this time I was feeling that the practice was like a dog chasing its own tail.  At least for the companies that have reached the top of their industry.  For new companies or smaller challenger companies the benchmarking was relatively more useful.  Those challengers still had a lot to learn from others.

More difficult was the fact that many best-in-class companies had different brand management  systems.  There was far more variability across companies than I had expected.  It turns out that what works in Company A may not work as well in Company B for any number of reasons.  Each company had enough uniqueness in their situation that the broad generalizations of benchmarking often became difficult to apply.  It became a lowest common denominator situation (admittedly of some very fine companies).

Which leads me to my own generalization:

You cannot benchmark your way into the future.

Recognize that the other best-in-class companies know as much as you know. At some point world-class companies need to wean themselves from much of this benchmarking. You need to take bold moves based on your vision of the future, not based on what your competitors may be doing.  

It is an important enough point that I will repeat it:  You cannot benchmark your way to the future.

Aristotle, Brand Guru: Part 2

In my last post on Aristotle, I touched on his role as an analytical thinker.  So let’s go deeper into that area.  

One of Aristotle’s great discoveries is what we now call deductive reasoning. It is Aristotelean logic that provided the first formal model for deductive reasoning.  A not too technical discussion of the model is available from Stanford University.  It is important for our conversation because deductive analysis is the approach taken in brand positioning.

For our purposes we’ll use the following definition for deductive analytics or deductive reasoning:  It is about looking at the entire data set and then drawing conclusions about a particular point in that data.

Here’s a more concrete example:  A leading company in laptop computers decides they need some market research to better differentiate their brand.  So they conduct a quantitative study of laptop computers that rates the importance of a long list of attributes and the performance of the top 6 brands on those same attributes.  In theory, this would represent all of the attributes that are important to laptop computer buyers.  From that you can see how the existing brands map on this universe of attributes.  Where there are no laptop brands on the map, you identified “white space” — a small number of attributes that are important to buyers but not strongly associated with any particular brand.

This “white space” is the focal point of your efforts to create differentiation for you laptop brand.  In “re-positioning” your brand these are the attributes that you want to associate with your brand.

When I was learning market research techniques, this was the approach that I was taught.  We did these large scale category studies and then sophisticated statistical tools to pinpoint precisely how strongly an attribute correlated with a specific brand.  We then used correspondence mapping to visually display the data so that we could make sense of it.  No doubt you’ve come across these studies over the years.

They are very powerful studies for understanding the world as it is in the minds of your audience today.  

They can tell you the existing strengths and weaknesses of your brand relative to the competition and relative to what is important to your customers.  

So far, so good for Aristotle!

Continuing with our example, it is reasonable to assume that all or most of the the other major companies are doing the same kinds of studies to assess their laptop brands.  This will help them find new ways of differentiating from the other laptop brands.

Soon we have a situation where many companies are now trying to re-positioning their laptop brands at the same time.  The universe is in motion.  Everyone is trying to differentiate their brands by moving to a new spot on the map.

Now a clever company comes up with an entirely new way of thinking about laptop computers.   The founders believe there is another way entirely of making and selling laptops.  They disregard the framework of the existing brands.  If their new laptop brand catches on in the marketplace, they have disrupted the universe of the existing brands.  (And if it fails, that will reconfirm the beliefs of the existing laptop companies).

This happens more often than you might expect.  Which calls into question the usefulness of deductive analytics.   Or limits deductive analysis to very slow moving, static, categories.  

Therein lies a problem with brand positioning.  It is based on a deductive analysis of the marketplace to identify the differentiating attributes.  It assumes an inflexibility in a world that is highly dynamic.  

So we need to revise our view of Aristotle as Brand Guru.  His “guru-ness” comes primarily from this work in Poetics.  His analytics, while important, are secondary in his claim to being the world’s first Brand Guru.

Still, not bad for a guy who has been dead for more than 2,000 years before the internet was developed.

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

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.


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