Emails to a Young Entrepreneur: Branding

Day 131 of Self Quarantine             Covid 19 Deaths in U.S.:  144,000

Branding

Flip Comic created by David Robinson

“People often assume the brand is the logo or symbol—and there’s no doubt that if that’s done well, it can give you a flavor for who the company is, whether they’re contemporary or traditional, and so forth. But I really see the brand as more than that logo or mark—it’s the totality of the way in which the company talks to its public.”

Kit Hinrichs

 

Bumpass Hell, Lassen Volcanic National Park, California, USA August 15, 2013

Dear Mikhail,

Your email reached me while I am enjoying a “Ring of Fire” high at Bumpass Hell in Lassen Volcanic National Park.  I can’t believe that it is mid-August and we are having to hike through two feet of snow in places.

I understand the difficulty of finding metrics for your products and services in your new venture. I’ve had to discontinue product development on several products that we couldn’t find good metrics for. I suspect you have found some good metrics, but only you can sort out which ones matter for guiding your future product development.

Shortly before we started merger discussions between Aldus and Adobe, we were interviewing for a new Director of Marketing Communication. As an executive I was asked to interview some of the candidates. Near the end of the process, Katherine James Schuitemaker showed up in my office in the middle of a typically frantic day. Knowing that there were several of my managers waiting for meetings, I thought I could gain back a little time by doing a perfunctory interview. Little did I know I was about to meet one of the finest collaborating colleagues of my life.

In my previous 25 years of management, I worked with a wide range of corporate marketing and agency talent. While marketing is not my area of expertise, I was rarely impressed with marketing folks.  As a result, I did not have a skills template for a good marketing person, let alone a Director of Marketing. All I knew is that marketing folks had these outlandishly large budgets which they always spent – to little effect.

Running down my stock list of interview questions, I asked Katherine “what is your philosophy and understanding of branding?” I expected some lametard answer about designing cool logos (my feeble understanding of branding). Instead I got an education that started with “Branding is everything!” expressed with every energetic fiber in Katherine’s being.

Whoa! I had to challenge that. “Excuse me, but product is everything. Marketing is just the gloss and expensive budget that is spent without any controls. What do you mean branding is everything.”

Talk about waving a red flag in front of a charging bull. Katherine launched.

“Branding is everything. What you build as a product is just one component of the brand. The brand is the essence of everything Aldus needs to do as a company. Brand is the promise that is made to every customer. Brand is the experience that every customer has with every aspect of the product. From the first minute that the customer becomes aware of Aldus, to the out of box experience, to the trial of the product, to learning to use the product, to calling customer support when they have a problem, to receiving and installing product updates, to how you help the customer tell their friends about how wonderful your product is – branding is everything.”

I was having a hard time taking notes with the fire hose of passion that Katherine unleashed.

To slow Katherine down, I asked for an example.

Katherine explained to me her conception of branding by telling the story of her work in promoting the HP LaserJet.  While doing scores of buyer and user interviews, she kept hearing the customers say “I love my LaserJet.”  It took her a while to realize that the customers might actually mean they really had an emotional relationship with an object instead of a person.

When the customers were asked specifically about using a verb like “love”, they just laughed and said “of course, we don’t really mean that we love it in that sense.”  Yet, customer after customer kept saying those words.  So Katherine and her team decided to try out some print and TV advertisements using exactly that theme.

Long before I met Katherine and to this day, I remember those ads with enterprise customers talking about how they loved their HP Laserjet.  I remember a business manager sitting at his desk in white shirt and tie enthusiastically sharing “I love my LaserJet.”  I thought it was the dumbest ad.  Yet, what have I done since seeing those ads?  I have only bought HP LaserJets – for twenty plus years.  Those ads that Katherine generated increased LaserJet sales by over ten times to billions of dollars per year.

Katherine used those insights as a core part of her Value Exchange Relationship process.  Some of the questions that she asks (in oh so many ways) are:

Katherine took the customer research and turned it into the core of how she has helped countless companies since – people are in deep relationship with the objects of their life in a very similar manner to how they are in relationship with other people.

Reeves and Nass in the Media Equation:  How People Treat Computers, Television, and New Media Like Real People and Places performed a wide range of detailed, scientific studies to amplify what Katherine found through her research.  Despite countless denials, the research subjects treated the new media and objects of the information age as if they were dealing with people.  Yet, this research has not really made it into the design of objects and software.

As I reflected on the “brand is everything” assertion, I started paying attention to my favorite brands and started deconstructing them with Katherine’s point of view.  The first powerful experience that came to mind is the occasional experiences over fifty years attending the Masters Golf Tournament.

While the world has changed in myriad ways since my first visit to the Augusta, Georgia slice of heaven, the experience of the Masters is as magical today as it was when I attended my first Masters in 1967 with my father. The beauty of the hundreds of Pantone shades of green come to life with the interspersing of the multi-hued azaleas providing the backdrop for the world’s best golfers.

In 1967 we walked the 18 holes of the course and rested after the long climb up the fairway of the 8th hole. We noticed a little white ball come bouncing onto the green with no golfers in sight. As if drawn by a magnet the ball went straight for the hole and dropped in. There were only 20 of us standing around the green to witness Bruce Devlin’s double eagle (only the second recorded at the Masters).  Cool.

As we continued around the course, I didn’t want to leave the bank below the sixth hole where all the University of Georgia coeds were sun bathing on this warm spring day. Dad dragged me away to the food tent where we filled up with $.50 pimento cheese sandwiches and $.75 beer. This beautiful course flows with great looking women and inexpensive food. Can I come back every year, Dad?

Fifty years later, the golf holes are different to accommodate the changes in golf equipment and the skills of Tiger Woods, but the experience represents the best of the old South. The azaleas and coeds are still spring time beautiful and the food a tasty and amazing bargain (sandwich $1.50 and beer $3).

In spite of several generations of Augusta National managers and professional golfers and a wide range of external criticism for not accepting people of color and women as members, the organization has grown the brand, evolved their membership rules, and increased the number of tickets (from 40,000 to 150,000 for the four day tournament) while still keeping the brand, brand promise and brand experience the same.

Skip celebrating Phil Mickelson’s First Masters Victory

An important part of the Masters tradition and experience is that no cameras or phones or electronic equipment are allowed on the property.  The “patrons” are here to focus on great golf and masterful golfers and enjoy being a guest of the Masters golf club members. There are no distractions. A special part of the event is that you can only track the scores from the scoreboards and follow the loud cheers or groans when a golfer does something great or poor somewhere on the course. The cheers tell you that something happened but you have to wait for the score to be updated on the manual scoreboards to understand what just occurred. We have to use our imagination to create the remote experiences on the course. Returning to a simpler time of pure imagination is part of the charm.

At the core of the Masters experience is recreating the values of Bobby Jones, the last great amateur golfer, who designed the Augusta National course and established so many of the traditions. The club members strive to have each patron be transported to the world of Bobby Jones each April. No matter who you are and how famous or rich you are, you are still just a patron. In the photo above, I was just a few feet away from another one of my sports heroes – Jeff Gordon of NASCAR fame. Like the rest of us, Jeff sat in his fold up green Masters chair. For the five hours we all watched the golfers finish their final round  at the 18th green in 2004, Jeff was just one of us patrons. Not a single patron bothered Jeff for an autograph. We are all special during those four days.

How do they do that?

Clues to how the Masters achieves their brand promise and brand experience can be found in the Email on Conceiving – being clear about their “why” and their values.

While one of our family tragedy stories is of the year that we lost our Masters tickets by failing to renew them, I married into the Keleher family and their two annual Masters tickets. Once Jamie’s parents got older they would give the tickets to one of their children to go to the Masters. So every six years we got to visit Augusta National again. Not knowing how many times we might continue to visit due to Grandma Barb’s poor health, during our last visit we took our three kids so that they could each have a day to experience the Masters. And not a single member of my family is a golfer. The Masters experience transcends sports.

I love the Masters.

I love the Masters so much it was important to pass the Masters experience of my father and Jamie’s father to our three children – three generations of Masters experience. Different years, different interests, and different attitudes and the depth of the Masters brand, promise and experience transcends all.

Sound familiar – I love my HP Laserjet printers.

If I marry the Masters golf tournament, what will my life look? Looking back, my life is filled with fifty years of deep memories – both of being at the event eight times and watching the tournament on TV the rest of the time. Watching the Masters on TV is different than watching any other event as I’ve been to the actual golf course. I’ve experienced the dramatic undulations of the greens and the unfathomable distance and hazards of Amen Corner.

Katherine went on to share the fundamental questions that an entrepreneur needs to think through when creating your brand.  Your brand is your company. Your brand is what you stand for. Your brand is your relationship with all your stakeholders.

From the very start of your “branding is everything” journey, these are the core questions. None of us gets these “right” at the beginning. You are only guaranteed to get them wrong if you aren’t deeply explicit about the answers at each stage of your journey.

As Katherine worked her clients through the Value Exchange Relationships, she realized that the 4Ps which are a cornerstone of brand thinking were changing. The traditional 4Ps of the industrial age were shifting with the advent of the information age and the Internet.

Working with Katherine at a couple of new ventures, we realized that with the advent of social media the 4Ps were shifting again:

The other starting point for thinking about your branding is the Positioning and Value Proposition that Geoff Moore describes in Crossing the Chasm. The elements of the positioning statement are:

    • For (target customer)
    • who (statement of need or opportunity)
    • the (product or company name)
    • is a (product or company category)
    • that (statement of key benefit / compelling reason to buy) .
    • Unlike (primary “competitive” alternative) ,
    • our product (statement of primary differentiation).

An example of the positioning statement from the early PC days when Windows 3.0 released was:

“For PC users who want the advantages of a Macintosh-style graphical user interface, Microsoft Windows 3.0 is an industry-standard operating environment that provides the ease of use and consistency of a Mac on a PC platform. Unlike other attempts to implement this type of interface, Windows 3.0 is supported by every major PC application software package.”

A more recent example of a positioning statement is the Google search engine:

“For web users who want an easy way to find the right information fast, Google is a simple yet highly discerning search engine that turns content on the web’s 1.3 billion sites into just what you wanted to find. Unlike other search engines, Google delivers only the most relevant results in less than a second, without the delay and distraction of downloading a page full of advertising or useless links.”

David Aaker is a prolific author on the many aspects of branding. His Brand Identity Planning model is a deep and formal look at branding.

In a blog post Aaker shares his Top 10 Brand precepts:

“Out of my five brand books, what precepts stand out as one of the top ten? Which are most critical “to do” tasks for someone charged with creating or managing a business? What do you need to know to excel at building a brand? Here is my top ten list:

  1. Treat brands as assets.Acceptance of the concept that brands are assets and have equity really changes not only branding and marketing but also business strategy. No longer is branding a subset of marketing to be managed as a communication problem. It becomes strategic, both reflecting and enabling the business strategy. Importantly, a brand is more than image and awareness—it also includes the size, the engagement, and the loyalty level of the customer base. That means that brand strategy needs to be developed in tandem with the business strategy, both need to be clear on the target market, the value proposition, and the investment priorities over time.
  2. Show the strategic pay off of brand-building.Part of the challenge of getting brands accepted as strategic is to demonstrate that they pay off. Unlike tactical marketing which can demonstrate short-term results, the long-term effects of brand building are difficult to demonstrate. One way is to observe the success of a business strategy and show how dependent that strategy was on brand assets. Another is to use surrogates for long-term impact such as measures of customer loyalty. But it is reassuring to know that, on average, brand building does pay-off. I have conducted four studies with Professor Bob Jacobson of the University of Washington which explored the relationship between brand building and financial returns. Our study of brand equity and stock return is typical. A well-known fact in finance is that there is a strong relationship between earnings changes and stock prices. We found that the impact of building a brand on stock return was nearly as great as earnings, actually 70% as much effect.
  3. Recognize the richness of brands – go beyond the three-word phrase.Brand building starts with determining the aspirational associations, what associations should come to mind when the brand is cued. In general, this set should be from six to twelve associations. Of this set, two to four should be identified as the most important and the most able to drive effective marketing programs, and the most likely to resonate with customers. In the brand identity model, they are termed the core identity elements. There may be a unifying concept termed the brand essence that provides an umbrella summary of the brand’s thrust but in some cases, it just gets in the way.
  4. Get beyond functional benefits.There is a tendency to focus on attributes and functional benefits because they are assumed to be what customers are buying and because market research is often functionally focused. The fact is–customers are not logical and functional benefits rarely provide a basis for sustainable differentiation or a deep customer relationship. Look instead toward emotional and self-expressive benefits. Thus, a customer can feel safe in a Volvo, excited in a BMW, energetic with Coca-Cola around, or warm when receiving a Hallmark card. A person can be cool by buying clothes at Zara, successful by driving a Lexus, creative by using Apple, a nurturing mother by preparing Quaker Oats hot cereal, frugal and unpretentious by shopping at Kmart, or adventurous and active by owning REI camping equipment. Consider also brand personality. Should the brand be confident, competent, fun, warm, or energetic, or some combination of these? Sometimes a brand is best expressed through a personality.
  5. Consider organizational associations.While most offerings struggle to be differentiated, an organization will have people, programs, values, strategies, and heritage that will almost always be unique. Further, the organizational characteristics can be meaningful to customers. They can provide credibility with respect to the offering by demonstrating or suggesting that the firm has the capability and will to deliver on its promise. Consider the visible commitment of Zappos.com to Wow! Service. Further, organizational values and programs can provide a basis for a relationship. The SalesForce.com policy of providing one percent of their product, time, and sales to public service. For some, that policy reflects shared values that lead to a respect-driven relationship that goes beyond products.
  6. Look to role models.Knowing aspirational associations is a crucial first step, but how to get there is a practical issue. Looking at role models that can be adapted or leveraged nearly always provides useful insights. Suppose a brand aspired to be considered warm and friendly. Find other brands that have succeeded in doing so, including brands in disparate industries. How did they get that reputation? Can anything they did be adapted? Or look within your own firm. What people or programs best exemplify those characteristics to customers? Can their efforts be expanded or extended to other parts of the organization?
  7. Understand the brand relationship spectrum.Brand portfolios can be so messy and dysfunctional that a firm’s new product process is paralyzed because there is no concept of which brand to use on a new offering. Customers may be so confused that they can’t even buy. The brand relationship spectrum can help create clarity, leverage, and synergy in the portfolio. The idea is that a master brand may work for a new offering if its associations are consistent and helpful and will be reinforced by the new role. However, there are times in which the master brand will be inconsistent or confining and the new offering requires some separation. The spectrum suggests that a sub-brand will generate some separation, an endorsed brand more, and a separate brand the most. The challenge is to find the right degree of separation and to create brands that can perform these roles.
  8. Look for branded differentiators.It is difficult to create differentiation especially involving functional benefits because a competitor will quickly copy or appear to copy or otherwise neutralize the advantage. Unless you brand it. A competitor cannot copy the brand. If the innovation is branded and the brand established, the competitor’s task of creating and communicating an enhancement will be formidable. When Westin created a superior bed and sleeping experience and branded it the Heavenly Bed, they changed the way that many looked at the hotel experience and the branded differentiator made it difficult for imitators to get traction.
  9. Use branded energizers.We now know that brands across the globe have declined in terms of perceived quality, loyalty, and visibility over the last decade. The exceptions, those brands that have energy, have resisted the decline and still drive financial results. Energy may be the most important imperative for brand builders. The best form of energy, innovative new products, is not available on a regular basis for most firms and not available at all if you your offering is an unexciting one like hot dogs or life insurance. In that case, an option is to find some branded program or person, a branded energizer, and attach your brand to it. Avon’s Walk for Breast Cancer is an example of a program that added energy for a brand that could never achieve it with products.
  10. Win the brand relevance battle.The way to gain market position, often the only way, is to develop offerings so innovative that they create new categories or subcategories making competitors irrelevant. The goal is to encourage the customer to select a new category or subcategory for which your brand is the only one with credibility and visibility. In virtually every industry, an analysis will show that market positions are very stable in the absence of such innovation. Relevance is also a threat to the leading brands who must be concerned with having customers — who respect and maybe love their brand — decide that they no longer want to buy what the firm is making, its brand has become irrelevant.”

Apple is recognized as one of the best brands for user experience and innovation. Most authors at some point use Apple as an example, usually in breathless admiration. Once you have established a valued brand, each day is an exercise in increasing the value of the brand. And when the brand experience fails miserably, it is beyond jolting to the customer.

Apple is not without its faults. While the Apple iTunes and Apps Stores are fantastic business drivers, the application software “sucks beyond multiple levels of suckiness” (a phrase coined by Dean Dan Turner, UW marketing professor to describe his brand experience with BMWs).

A couple of months ago I dropped my iPad and cracked a corner of the retina display. I knew that Apple was going to be releasing a new iPad in November 2013. As the release date showed up, I didn’t have the time to order and pickup my iPad before I left on a trip to the east coast. I figured I’d just buy one while I was visiting my brother in Columbia, MD.

I arrived at the store 15 minutes before opening and was one of the first to gain the attention of one of the sales people. They had the 32GB white iPad that I wanted and the salesperson brought it out. I handed him my credit card and was delighted to be through in just a few minutes with the delightful Apple in store experience.

The dreaded words “Sorry, sir your credit card is denied” hit me like a hard slap to the face. How could that be? I just used it. OK, “try this one” as I handed him another credit card.

“That one is denied too, sir.”

Then the Apple genius asked me “you’re not from around here are you?”

“No. As a matter of fact, I’m travelling here from Seattle.”

“In that case, none of your credit cards will work. Apple has an arrangement with all the credit card companies to declare any transactions that are more than 50 miles from your home invalid due to fraud concerns. Apple is one of the biggest targets for fraudulent credit cards.”

I was livid. I hate Apple today.What should be an exciting purchase day to get my new iPad that I’ve waited months for was turning into “I really hate Apple today” experience.

I asked the clerk (he was way below a sales person at this point) if we could do it manually. So we found one of my credit cards that would allow us to call and verify the transaction the old fashioned way. I was surprised that the Apple store had an old fashioned credit card mechanical swiping machine. I waited very impatiently while the clerk took 20 minutes to fill out the paper receipt, called the credit card company to verify that I was who I said I was, and then completed the transaction manually. What should have been a 5 minute transaction took 30 extra minutes. The only way I kept my sanity was to take photos of the manual process in the ultra-hip innovative Apple store.

Manual capture of my credit card

As I remind myself of my love/hate relationship with Apple, I remember my colleague David Robinson sharing that to better design a brand or brand experience, it is helpful to start by designing the negative experience. How would Apple design the store experience if they wanted to negatively affect their “brand is everything”?

The airline and air travel industry is one of the best examples of how to make dealing with a brand a miserable experience. I sometimes think there is a group of airline industry marketing executives who gather each month in collaboration with the TSA to make air travel as miserable as possible. At least we no longer have smoking on flights.

Vijay Kumar in his 101 Design Methods describes the Compelling Experience Map:

In many ways, this micro brand experience design method provides a road map for how to think about designing the brand, brand promise, and brand experiences you want to provide your customers. The “brand is everything” is a collection of designed experiences where your employees and customers are key participants.

A few months ago I participated in a Nordstrom’s Innovation Bootcamp. I was excited by the excellence of the workshop and the compelling experience design the facilitators employed. I was surprised by how large the Nordstrom’s technology group had become as their online business expanded. I noticed that there were quite a few Amazon and Google executives now at Nordstrom. What was going on?

When I think of Nordstrom’s I think of the store experience I came to know twenty years ago shortly after we moved to Bainbridge Island.

I hate buying clothes, particularly business suits.  But I have added a lot of weight, so it is time to get a new business suit.  But still I delay.  Then, Greg Kent, a neighbor who is the Men’s Department Manager at the Seattle Nordstrom’s, talked me into at least trying his store.  “It’ll be painless.  I promise.”

I went the next day.  We started with the basics, a blue suit and a blue blazer.  In twenty minutes they were selected, tried on, fitted by a tailor, and I was ready to go.  “What time next week should I pick these up?” I asked.

Greg laughed and said, “I’ll stop by your house and deliver them tonight on my way home.”  I think my jaw must have hit the floor.  Each month Greg lets me know what’s on sale that I might like.  Nordstrom now has a customer for life.

Yet, there are things that I value and buy quite a bit of — books, wine and software.  I spend several thousands of dollars a year on each.  Most of this money is spent with a few stores or companies (Eagle Harbor Books, Cayuse Winery, Microsoft, Frys).  As far as I can tell, none of them knows or cares that I exist.  None of them knows me except through the occasional mailing list trying to get me to buy something.  None of them bothers to communicate with me as a unique individual.  None of them comes close to the Nordstrom model of perfecting customer service — one customer at a time.

As I listened to the Nordstrom Bootcamp participants, I realized that Nordstrom was no longer competing with other retail stores. As a large eCommerce retailer, they were now competing with Amazon. How does their in store brand, brand promise and brand experience translate to the web? How does Greg Kent translate online?

The Nordstrom Bootcamp was a great reminder that even when you have mastered brand, brand promise and brand experience, the world changes.

I love my HP Laserjet.

I love the Masters Golf Tournament.

I love Nordstrom.

I mostly love Apple.

Yours in entrepreneuring,

Skip Walter

 

This entry was posted in Content with Context, Emails to a Young Entrepreneur, Entrepreneuring, Flipped Perspective, Learning. Bookmark the permalink.

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