Is Your Brand Coherent?

There are two types of brand; generalist brands which are aimed at multiple market segments; and specialist brands; which are often targeted on a single market segment.

Generalist brands often have products which are sub brands.  For example, Heinz is famous for its 57 varieties (in fact there has always been far more than 57 Heinz product lines). Heinz Tomato ketchup is a sub-brand which has a number of product variants e.g. reduced sugar content and organic ketchup.  Generalist brands demand a differentiated marketing strategy.

Specialist brands have products which are variants. Morgan is a specialist sports car brand aimed at vintage motoring enthusiasts. The brands products are variants of the vintage sports car design (including the three wheel tricycle). Jim Dunlop is the go to brand for guitar plectrums and a wide variety of plectrums is produced using different materials to give distinct tones.  Specialist brands require a niche marketing strategy.

There are commonalities between generalist and specialist brands.  Both have physical and intangible attributes.  Both have core and peripheral facets. To be successful and to grow brands, these attributes and facets have to be coherent.

Commonly, brands grow through multiplication.  growth through the introduction of product variants.  In this way specialist brands can grow to become a generalist brand and market expansion occurs.  There is a gradual shift from a niche strategy to a differentiated strategy.

Often growth requires adaptation of a brand’s products as the initial market is expanded and growth may also require the adoption of new distribution channels.  The marketing mix may need to be adapted to suit the requirements of these new distribution channels. Care needs to be taken to deal with potential channel conflicts e.g. pricing disparities.

Often market expansion to grow a brand means going international. In such circumstances brands may need to be adapted to suit different cultural and social norms.  The use of local agents and distributors may mean that there is local reinterpretation of brands.

What is certain is that growing a brand introduces diversity.  So how do you grow a brand without losing the necessary facets and attributes of the brand identity?

The answer is the creation of brand coherence.  Growth of a brand should not be seen purely in terms of increases in sales and profits. You also need to grow the brand’s reputation, identity and its defences against competition.

This means that brand growth requires your business to be coherent in everything it does.

Brands are constructed in stages; from top to bottom.  Senior managers will create a brand platform, the core of a brand; its identity.  Functional management will then create products services and experiences which fit that brand identity.

Consumers however view brands in the opposite way. They see the products, services and experiences first.  Consumers assess the essence of a brand through their expenditure and the processes they have to go through to access and use the brand. The brand identity is perceived through repetition of this process.

A consumers first contact with a brand is the beginning of a journey to the understanding of a brand’s identity.

So managers across an organisation from Marketing to HR, Finance to Operations, need to know the perception an organisation is trying to create in the minds of consumers with respect to the brand.  They must be sure to eliminate that which does not conform to the required brand perception.  So a successful brand, to be coherent external to the organisation, needs strong internal policing of brand activities.

You need to build a brand through specific brand values, its exclusiveness and by the creation of motivational added value.

You need to teach and repeat brand coherence over time.

However, repetition of brand attributes to build coherence does not mean uniformity. Repeating an identical message over and over again is boring. To drill your brand coherence into the minds of consumers, you need surprise.  However if you overdo the variety in your message, your brand identity will turn out fuzzy and incoherent.

Brands need family resemblance, but everything should not be cloned. There and be difference but within a family resemblance.  The Kardashians are a family brand but each member of the family is different.  However each Kardashian shares family traits.

So when growing a brand you need to retain core family attributes and the core identity whilst carefully introducing variety and surprise.

A brand name is a point of reference and an indicator of added value. If you put a product under a brand name, you are attaching that brand identity to it.  If the product does bot conform to expected brand attributes, it is incoherent, and can risk the brand as a whole. Consumers must be able to visualise the family identity in the product.  Critical in this are product packaging, labelling and other physical elements of the brand.

If extending a brand, the introduction of big changes can weaken family identity.  Family identity cannot be reduced solely to physical appearance. You need to create and sustain the brand halo.

Brand coherence is not brand uniformity. An excess of uniformity kills consumer desire. Coherence involves little surprises but the maintenance of core brand values.

Brand coherence is a see-saw balance between those surprises and brand specifics.

Making your brand authentic

Traditionally, when the word authenticity was mentioned by senior executives, it was defined by the term ‘the genuine article’.  It was a reference to official goods as opposed to counterfeits.  Authority was conferred on a product through the enforcement of intellectual property and the use of legal force in terms of both criminal and civil sanctions. Thus authenticity was conferred on products by their manufacturer.

Today, authenticity is conferred through the perception of consumers.  To develop an authentic brand story, you must buy in to the perceptions of your target consumers and fit within their concept of the truth.

What recent political campaigns have shown is that something doesn’t need to be true or factual to confer authenticity.  Leave won the EU referendum campaign through the widespread dissemination of lies and myth.  They plastered a bus with a false and misleading statements about “£350 million a week for the NHS”.  This was a lie as the UK only ever paid a fraction of that sum to the EU as its membership fee.  Donald Trump continues to send out false and misleading messages.  For example, this week he tweeted about a large rise in the crime rate in Germany.  In truth crime in Germany has fallen to its lowest level in over a decade.

Obviously there are laws to prevent the dissemination of false or misleading statements about products (e.g. the Consumer Protection from Unfair Trading Regulations 2008) and there are far less robust controls in politics.  However the Trump and leave campaigns won because their messages fitted best with the perception of the truth amongst the target audience.  Common sense and facts did not matter, the misleading messages fitted with the target audiences beliefs.  Both Trump and Leave cynically targeted the less well-educated and the politically dispossessed with fairy stories and the creation of a false Utopia.  In the long run the lies told by Trump and Leave will be exposed and the effects of a policy based on lies will be felt.  But politicians aren’t trying to maintain a product over decades.  Their concern is for the immediate campaign, not the campaigns of ten years time.  They are quite happy to deliver a prospectus which contains false authenticity because by the time the effects are felt, the ‘product they sell will be gone.

That is not an appropriate strategy if you are trying to develop brand authenticity in the long-term.

However, as with politics, something doesn’t need to be true to be authentic.

Charles Morgan, of the Morgan Motor Company, which makes ‘classic British sports cars’ said:

“Rather than a brand, I think it’s an attempt to interest the cult and to keep the cult going.  we like telling stories people can tell in the pub and that makes them feel part of the family.  And so the brand is made up around a series of myths; some of which are true, some of which are owned – The one about the wooden chassis in France, we have tried and tried to get rid of that, but it still persists; and I think eventually we’re going to have to say, “Okay, yeah, yeah, it’s true”.

Of course, parts of a Morgan car are constructed from wood, but the chassis is not and never has been.  The wooden chassis myth is part of the subjective nature of brand authenticity.  The fact Morgan talks of myths, truthful and owned, is part of the firm’s creation of an alluring mystique which is authentic in the minds of its target customer group.

So why does brand authenticity matter:7

  1. Consumer brand choice is an extension of their desired self.  They use brands to achieve self-actualisation (the peak of Maslow’s Hierarchy of Needs.  Consumers use brands to confirm a preferred identity but they also go further and use brands to connect with a preferred community.  A brand is a connection to those who think alike.
  2. Authenticity can increase brand equity.  Brands considered authentic are often viewed more favourably by consumers and therefore are seen to have greater worth.  Authenticity can lead to greater loyalty, more word of mouth communication, helps to create brand communities, makes consumers more tolerant of failures and often acts as a defence in tougher times.  In market research, if consumers see a brand as authentic, it is an indicator of purchasing intention.
  3. Authentic brands are often long-lasting.  Their product life cycle is long or cyclical.  Brands seen as authentic can persist for decades.  The UK has two of the oldest brands in the world, Lyon’s Golden Syrup and Bass beer.  Both these brands have persisted for nearly two centuries.

Developing authenticity provides an ongoing point of difference.  It can also provide excitement and élan.

For example, Lexus cars are seen by consumers as technically excellent but boring.  Alfa Romeo cars have a record of inconsistent performance (particularly electrical faults) but they are seen as having soul.

Here are five strategies for building brand authenticity:

  1.  Become part of the community:  Assimilate the psyche of nations and sub-cultures.  What is Australia without Vegemite? What is France without Champagne?  What is London without the red double-decker bus?  What is Scotland without Tartan?  Being part of the community makes it difficult for new market entrants to gain a foothold.  If you are part of the community, buying your product is an act of identity, not just loyalty.
  2. Challenge conventions:  It is often authentic to go against conventions; although admittedly that sounds counter-intuitive.  For example, nineteenth century Britain the accepted culture was one of modernisation and technological advance.  William Morris, patron of the arts and crafts movement went against the zeitgeist.  Through Liberty he chose to champion artisan skills and a culture of craft.  He espoused a simpler age based on nature, tradition and emotion.  Liberty still exist to this day.  Punk arose in the late 1970’s as a reaction to the convention’s of progressive rock.  Where many saw the future of popular music as complex and taking influence from classical music, Punk looked to the simpler three chord structures previously seen in fifties rock and roll.  these simpler structures were seen as more authentic than prog.  Dyson are all about challenging convention.  Dyson’s technology is seen as authentic because it challenges vacuum cleaner designs which hadn’t changed in decades.  It is authentic to target the rebellious spirit in all of us.
  3. Stick to your roots:  Authentic brands are stubborn.  It is often a convention in marketing that to sustain a brand over time, you need to adapt to changing environmental, societal and technological factors.  However brands recognised as authentic often ignore societal change and stick to their roots.  In fact there could be a consumer backlash if they do not.  For example, Irn Bru recently changed its recipe.  It reduced the sugar content as a result of a tax introduced by the government on sugary soft drinks. Barr’s faced a backlash from its customers in Scotland who were unhappy at the recipe change.  In contrast, Coca Cola accepted the new tax and raised prices rather than lower the sugar content.  Perhaps Coke was ‘once bitten, twice shy’ following the failure of the New Recipe Coke in the late 1980’s.  Brand history is critical to authenticity.  Heritage, sincerity and love of production are central to consumers’ perception of authenticity.
  4. Love of craft:  Are your people passionate about your products and services?  Do senior managers spend time on the shop floor?  Consumer’s see authenticity when a firm shows true love of their craft.  Morgan cars are one such example.  It has retained the craft of hand-built coach work when other car manufacturers have factories filled with robots.  The firm is family owned and its managers own and drive its products.  Currently there is a group of Star Wars fans who want to remake The Last Jedi ‘properly’.  They feel the latest film in the series didn’t fit with the values of the ‘Star Wars’ brand and with its established conventions.  Brands run and staffed by enthusiasts are seen as authentic.
  5. Business Amateurism:  Authentic brands are often run by people who the general public see as amateurs.  A fine example is Ben and Jerry’s Ice Cream.  In the minds of many consumers, Ben and Jerry are two hippies who decided to sell ice cream.  They are not seen as hard-nosed businessmen.  The impression is that such firms reject market research and use gut feeling.  Of course, this is nonsense but the brand is seen as authentic as it has developed the myth of the amateur.  Amateurs have redeeming features.  They do it for love rather than remuneration.  They think differently (often through a lack of training).  Amateurs are often unconcerned about fame, paying bills or meeting targets.  They are viewed as grounded, humble and playful.

Authenticity is shown, not described.  Overt claims of being authentic are often seen as hype.  Such claims may make genuine brand claims seem fake.

For cultural immersion, small details and one-off experiences can count as much as extensive research programmes.  It is appropriate to immerse yourself in the market culture.  I have just watched Darkest Hour, the film-based on the early days of Churchill’s premiership during World War 2.  The critical scene is where Churchill takes a short journey on the London underground and ask the opinions of the commuters in the tube car.  This is what he bases his policy on, not the statistics produced by his civil servants.  Ugg, the sheepskin boot manufacturer takes a great interest in the views of its ‘brand fans’.  Ugg invites these fans to have work experience in the company where their individual views can be examined. Ugg fans directly impact decision-making.

Employing a brand historian can help develop authenticity.  A brand’s past can inform its future.  authenticity can be built through a company’s history and the colourful characters associated with a brand.  How many firms advertise themselves through the quirks of their creator?  For example, Huntley and Palmer biscuits sponsored Captain Scott’s expedition to the south pole.  Despite the expedition being a disaster, it is seen by many British consumers as an expression of British bulldog spirit and bravery against adversity.  Huntley and Palmer’s exploit  their history to develop brand authenticity.

Authentic brands are not afraid of letting their consumers in on their processes.  It is often critical to firms to get their consumers’ views on new technological innovations, new recipes and new products.  For example many software manufactures use beta testing.  They get trusted consumers to use prototype software and to identify bugs and potential improvements.  Showing you trust your consumers with your ‘in development’ products builds the impression of partnership, shared values and thus authenticity.

Authenticity can be developed through the exploitation of lucky breaks.  Ugg boots started life as a specialist product for male surfers.  they were designed to keep surfers feet warm when they got out of the cold ocean.  The brand got a lucky break when young female consumers saw the boots as comfortable and fashionable.  Dyson took advantage of a market where product design was assumed to be unchanging.  He was also lucky in that the market leader, Hoover, was in financial difficulty following the Sinclair C5 debacle and a disastrous free flights offer.  Dyson took advantage with new technological designs and fashionable design.

Creating and developing brand authenticity is a challenge.  It is critical to develop open-ended and rich stories rather than technical position statements.  It is important to espouse enduring values, emphasise love of craft and to develop a powerful organisational memory.

Brand language and communications

Increasingly promotional activity and communicating brand messages is not a verbal medium; it is a visual medium.  The requirement to create visual messages; combined with the ever-shortening attention spans of viewers; makes promotional advertising and the communication of brand messages more difficult.  Consumers are bombarded with commercial messages.

This means that if you are to successfully communicate your brand message, you must carve out a distinct territory.  A unique and successful brand message does not appear out of thin air.

Creating brand territory is not as simple as just repeating the same phrases over and over again.  It is the development of a brand language which expresses your corporate ideology.  It is a favourite practice of politicians to come up with a single phrase which encapsulates their whole campaign; for example Donald Trump’s ‘Make America Great Again’, Theresa May’s ‘Strong and Stable’ or Tony Blair’s, ‘Education, Education, Education’.  Politicians are trying to create a shorthand which uses a single phase to draw the attention of the widest possible electorate.  However, for a commercial branding strategy, such shorthand leads to excessive repetition which can clog up the brand message.

Often there is such an urge to create an image of unity and common spirit in a brand message across different campaigns that brand messages become a code.  Code is artificial language.  it isn’t human or natural.  When creating a brand message you want to communicate personality, your culture and your brand values.  You want to announce products in a way which charms customers.  If you resort to a shorthand, impersonal code, these factors are missing.

Rather than creating a code, you need to build a glossary of terms which apply to your brand.  Such a glossary helps decentralise your message whilst keeping your chosen language within your identified brand prism.

The process is similar to the creation of the style guides used by newspapers and other publications.  The style guide for The Economist runs to over three hundred pages and the Yahoo style guide is even longer.  These documents specify the agreed spelling of certain words, page layout and appropriate punctuation.  They define how these publications look on the page.

A brand charter, or expression guide, the promotional equivalent of a journalistic style guide.  They will include agreed phrases and even where on a page the brand name and logo are located but they will also specify the dominant features of style such as colours used, text fonts and image requirements.  For internet and television promotions they will show agreed gestures and jingles.  Graphic layouts and narrative structure codes will be included.  Think of a Coca Cola television of cinema advert, they will nearly always show someone drinking from the traditional glass Coca-Cola bottle (the bottle shape is a registered trademark) even though the majority of Coca Cola sales are now either in metal cans or plastic bottles.

In mature markets advertising is a challenge. There are no guaranteed results and often defined goals are not easily measurable.  Such goals are not SMART (Specific, Measurable, Achievable, Realistic or Time Bound).

As a result many brands are switching away from traditional advertising forms and mediums.  For example the wine brand Jacob’s Creek has stopped using traditional television advertising and instead has switched to the sponsorship of television programmes.  Jacob’s Creek was built on an award-winning product, in-store promotions, support to the retail and distribution trade and customer tasting sessions at the point of sale.  The switch from traditional television advertising to programme sponsorship is a better match top the brand image and ideology.  Another tactic being employed by Jacob’s Creek and other brands is the increased use of product placement in films.

For top of the range brands, a common branding tactic is an association with opinion leaders.  For example, eBay is arguably the most successful internet sales and auction site.  eBay’s position was not built on television advertising (although recently they have started to use that promotional channel).  EBay developed its brand position through the use of online referral and public relations.

There is an old maxim: “Half of my advertising budget is wasted but I don’t know which half”.  Statement is nonsense.  Wasted promotional activity is easy to identify.  It is advertising activity which:

  • Is not sufficiently creative and individual
  • Which misses its target audience
  • or which is shown where the promoted product is not on sale.

Of these three reasons, the first is the most important.

Often, the failure of promotional campaigns is blamed on the advertising agency.  However, the client employing the agency can be equally at fault.  often promotional campaigns fail because the specification provided to the agency is not clear in identifying the required brand message of the goals to be achieved.  Often the fault is the quality of the brief, not the quality of the agency.

Brand propositions must be incisive.  They cannot be bland.  it is unlikely that even the most creative advertising agencies can transform a bland brief. A promotional brief that is full of statistics and has a dearth of actionable ideas is likely to fail.

You must radicalise your advertising targets.  Your brief shouldn’t just describe your target customers, it should reflect them.  Your promotional messages should be given through radical characters not plain people.  For many years Cillit Bang was advertised using a fictional character ‘Barry Scott’.  Barry became as famous as the product.  Many thought him to be a real person and not an actor playing a part.  The Barry Scott character was carefully designed to reflect the ideal consumer of the brand and to exaggerate defined characteristics.

After using the character for many years, Barry was dropped from Cillit Bang’s advertising and there was a distinct fall in sales.  So much so, the character was brought back and once again fronts their advertising.

Creative and radicalised promotions are difficult for brands which consumers have known all their lives.  Oxo has recently reverted to having a OXO family, a promotional strategy it first used in the 1970s.  However some mature and established brands do manage to present radicalised messages.  One need only think of the Cadbury Dairy Milk promotion with the drumming gorilla.

If you are looking to promote a brand over the long-term or to reinvigorate a mature brand, it is important to present a radicalised message and the development of a comprehensive brand charter.

Do brands have a life cycle?

Marketing science and history tells us that products have life cycles.  For example, consider the typewriter.

For about 100 years, the typewriter was the pre-eminent letter-writing tool in business and administration but in the 1960s, its dominance began to decline.  First there was the rise of the electronic typewriter, then the word processor arrived and finally, the personal computer arrived.  The PC basically killed the market for typewriters: its went into near terminal decline.

In some circumstances, it is possible to revive products using tactics such as line extensions, changing distribution channels, using price reductions and through market repositioning.

If products have a life-cycle, do brands?

Brands are not products, or logos, or company names.  They have wider recognition and a well-defined ‘personality’. Nike for example started as a pair of trainers but now is a far wider fashion and sports brand.  Nike doesn’t just make clothing and footwear, it makes golf clubs and other sport’s equipment.

L’Oréal began life as a hair dye but is now a major soap and cosmetics brand.

Louis Vuitton began making luggage for the upper classes but is now recognised for ladies handbags.  Vuitton has a clothing range and fragrances.

Many brands keep surfing for new products.  Virgin has major product/service lines such as Virgin Rail, Virgin Music and Virgin Atlantic.  However Virgin Group has over 200 corporate ventures in markets as diverse as healthcare, banking, tourism and cosmetics.

Some brands which are closely associated with a single product may decline, such as Polaroid and instant cameras, but brands with wide product portfolios is diverse markets can survive the loss of individual products.

So how do you protect a brand identity in the long-term?  This often means resisting low-cost competition.  This can be achieved by

  1. By enforcing intellectual property rights – Organisations like Coca Cola and Manchester United ensure they hold a variety of trademarks and other rights and do not tolerate brand imitations.  The shape of the coke bottle is a trademark.  Manchester United ensure they hold the image rights of players.  Intellectual property rights can be used to keep those who copy brands confused.  Many football clubs register trademarks they have no intention of using.  They send private investigators to pass fictitious strip designs to counterfeiters.
  2. You can nurture perceived difference in the minds of consumers.  This is achieved by always being ‘good news’.  ‘Good news’ is being seen as always making progress; always being at the forefront of market innovation through product reformulation and continuous but selective innovation.  Colgate Toothpaste is regularly reformulated for new ingredients.  Gillette razors are continually adapted to give an increasingly smooth and comfortable shave.  To preserve a superior image products should be renewed frequently.  Renewal should integrate mew and emerging customer needs.  Market superiority can be confirmed using line extensions.  For example, Head and Shoulders was originally aimed at people who suffered with dandruff.  Now it is the UK’s favourite shampoo brand.
  3. You can invest in media communication to protect a brand identity.  By ensuring strong share of voice, you can use communication as the brand’s weapon.  Guinness is almost as well recognised for its long history of advertising innovation as it is for its stout.  Media communication can be used to re-communicate the dangers of brand switching.  Faced with a flood of cheap Chinese lighters, Bic produced a leaflet highlighting potential safety dangers with cheaper products and distributed it to retailers.
  4. A dangerous tactic is to reduce price gaps.  This may be achieved using special offers and techniques but a BOGOF (buy one get one free). A permanent price reduction may do serious damage to a brand’s perceived value in the minds of consumers.  Often firms protect the brand by making a ladder which allows consumers to eventually achieve a premium brand.  Golf club brands do this by creating fighter products which allow consumers to experience a brand cache but at lower cost.
  5. A brand can be defended by identifying and suppressing unnecessary costs through the use of tools such as value chain analysis.
  6. You can fight destruction of brand value through education and innovation.  Consumers have an internal reference price for a class of product by reminding them of the additional value attributes of a brand you can recalibrate that reference price in their mind.
  7. Finally, you can protect a brand log-term by creating market entry barriers.  For many years Black and Decker defined the home power tools market by giving competitors little room to manoeuvre.  This was achieved by globalised production and economies of scale.  Coca Cola dominate their market through scale of distribution.  Other firms have vertically integrated into the supply chain or through purchasing raw material providers.  In the printer market Hewlett-Packard use technology as an entry barrier.  Their printer cartridges are brand specific and have software which prevents generic cartridges being used in their machines.  Manufacturers of photocopiers collect the empty cartridges for recycling but  this also prevents them being refilled by other parties.

The majority of brands can exist outside the frame of the product life cycle if properly managed.  A brand identity extends beyond product features and in some cases comes to define a whole market segment.

Defining marketing and why projects fail

I was chatting with a fellow member of the federation of Small Businesses at a recent networking event.  He mentioned that he had been at a talk given by the owner of a successful small business who commented that she had built her business without doing any marketing.  This was a statement which I found incredulous.

I suspect the business owner giving the talk was incorrectly defining marketing.  What she meant was that she had built her business without the use of print or television advertising.  If it is the business I am thinking of, I know she has used social media and the internet,  I also know she has used sales representatives and entered into arrangements with beauty salons to promote her products.  She may not have used traditional advertising but she has used alternative promotional channels AND THAT IS ONLY A SMALL PART OF HER MARKETING MIX.

In his book Principles of Marketing, a standard marketing text for graduates, Philip Kotler describes the forms of marketing used by businesses as they grow.

The first stage is described by Kotler as entrepreneurial marketing.  This is a company living by its wits.  Marketing activity is done on a whim, often based as the perceptions of market conditions in the mind of the business owner.  There is a considerable use of guerrilla and surprise marketing.  Marketing activity isn’t planned; it takes as and when the business proprietor believes it to be necessary.

As a business grows it is no longer possible to exist solely on unplanned marketing activities.  A business moves to a state of formulated marketing.  the scale of the business and the need to satisfy the needs of wider stakeholder groups requires a structured approach to marketing.  This is the standard marketing process in most businesses.

For very large businesses, there is still a requirement to be fleet of foot and not to be predictable.  Kotler suggests that these businesses use an ‘intrapreneurial’ approach to marketing.  He uses as an example Virgin, the conglomerate owned by Richard Branson.

Virgin is not just big brands such as Virgin Music and Virgin Atlantic, it is made up of over 200 separate businesses and several hundred legal entities.  Branson encourages his staff to come up with new business ideas within the group umbrella.  He is constantly searching for new market opportunities and new business concepts.  Not all of these succeed and several only exist in the short term, such as Virgin Cola, but several grow into significant market players e.g. Virgin Money and Virgin Holidays.

By encouraging his employees to act as entrepreneurs within his company, Branson can adapt to new markets and new technologies quicker than his competitors.  He wants his staff to act as market disruptors.  If Virgin is constantly changing the rules of the market, it is more difficult for his competitors to gain a commercial advantage. Virgin is also made up of linked but separate commercial units.  This means that if one unit fails, there is a smaller risk of that failure being a contagion affecting other business units.

Clearly, the CEO who was giving the talk was at Kotler’s stage one.  If she is to grow to a business which can compete with the multi-nationals which dominate her particular market, she may need to take a leaf out of Virgin’s book.

On a separate matter, I have being doing some CPD in relation to my project management skills and was taking notes from the book Project Management by Dennis Lock.  Again, this is a standard text for business and engineering graduates.

In the book, Lock states that a major reason for project failure is a poor project definition.  He lists ten reasons why inappropriate project definitions can mean that a project can fail at the outset.  These are:

  1. The project scope is not clearly stated and understood
  2. Vague technical requirements
  3. Estimates of cost, timescale and expected benefits are over-optimistic
  4. The risk assessment is incomplete or flawed
  5. The intended project strategy is inappropriate
  6. Insufficient regard is given to cash flows and the provision of funds
  7. The interests and concerns of stakeholders are not taken into account
  8. Undue regard is given to the motivations of people undertaking the project
  9. Insufficient regard is given to the reactions of those affected by the project by changes imposed upon them
  10. Politics and personal goals overtake the aims of the project.

Reading Lock’s list, I couldn’t help thinking of Brexit.  In particular the comments of Sir Amyas Morse, the head of the National Audit Office who has complained that the UK government proposals for leaving the European Union are “vague” and that there is a lack of cross-departmental work in government which could “crack open Brexit like the first tap on a chocolate orange”.

I concur,  the UK approach to Brexit appears so slapdash, it will likely cause severe damage to the UK economy and be disastrous for the UK business community.

How the Tories forgot the rules of brand promotion

The consensus amongst political commentators is that the campaign delivered by the Conservatives; sorry, Theresa May’s team; at the 2017 general election was a complete disaster.  At the beginning of the election’s long campaign, the polls gave the Tories a massive lead over Labour.  Theresa May’s approval rating as Prime Minister soared above other part leaders.  The election looked like it would be a landslide win for the Conservatives; the parliamentary Labour Party would be decimated; and Mrs May would get her mandate to deliver a hard Brexit.

Now, following her cataclysmic campaign, Theresa May’s dreams are dust.  She has been transformed from a reincarnation of Margaret Thatcher into a creature of ridicule.  She has lost all credibility.  She is a zombie prime minister awaiting the delivery of a blade to her political cerebral cortex.  It is only a question as to which of her backbenchers delivers the blow.

So how did May’s campaign disintegrate so spectacularly?  Many have pointed to her robotic and awkward delivery, her inability to think on her feet and her unwillingness to actually meet the electorate.  It is true that an attempt to run a campaign based on personality when your candidate doesn’t appear to have one is a major mistake.  Certainly a significant proportion of the UK population were confused by the campaign’s presidential style.  However, I believe a far greater flaw was that those running the campaign had clearly ignored the lessons in marketing strategy and brand management which Mrs May’s predecessors had successfully used to win elections.

When I was growing up in the 1970s, the presentation of political campaigns was staid and boring.  it was men in grey suits, sitting in sepia clad television studios, arguing about economic statistics.  All that changed in 1979 with the general election campaign of Margaret Thatcher.  The Iron Lady had employed Gordon Reece as her image consultant to ensure that she projected an appropriate personality to the electorate.  for the campaign itself she went outside her party machine and employed the advertising and marketing firm Saatchi and Saatchi to run the campaign.  The principles of commercial marketing and PR were applied to the campaign.  It was politics packaged like a tin of beans.

Many may think of Mrs Thatcher winning several successful landslide majorities

Mrs Thatcher’s successors took things further; Tony Blair in particular.  Blair clearly applied techniques used in Neuro-linguistic Programming such as the subtle use of repetitive phrases and mirroring body language of his inquisitors.  Blair used prominent slogans, such as ‘Education, Education, education’ but was also evident in his interviews and speeches were more subtle phrases and nuanced language designed to enter the subconscious of voters and make them act in a particular way.

I suspect Theresa May had been told of Blair’s neuro-linguistic tactics and tried to emulate them but her ability to execute them was sadly lacking.  Just repeating the same phrase over and over may get your message across but such overt declarations are will more likely bore your audience than affect their behaviour.

Perhaps the biggest fault in the Conservatives 2017 campaign was that it took an extremely old-fashioned view of promoting a brand.

The traditional view of a brand image is the creation of a solid identity.  To build this identity, it was felt that regular repetition of key attribute was required.  Sameness would build brand equity.  This was done to excess by Mrs May and it was the repetition of a single phrase ‘Strong and Stable’.  To Tory campaign managers ears this may have sounded perfect; the brand identity boiled down to three words.  The electorate however clearly read this message differently. To them it signalled not stability but a lack of adaptability, no fleetness of foot and a political ideology with its feet planted firmly in concrete boots.  The electorate clearly didn’t want a government determined to stick to its right-wing guns; it wanted a government with the ability to change in the face of a turbulent political climate.

The torpedo which sunk HMS Theresa May was her policy of using pensioners property equity to pay for their social care.  This policy directly attacked the Conservatives target audience, the over-50s.  Clearly, the unpopularity of the policy panicked Tory central office and the subsequent U-turn completely destroyed the single brand message of Strong and stable.  Such a U-turn wasn’t strong and stable, it was weak and wobbly.

A more modern view of developing a brand is to treat it as having two layers of attributes.  Kernel attributes at its core and peripheral attributes.  This view is to address a dichotomy in brand presentation.  Brands need a solid identity to provide capital but in modern markets, where consumers are impulsive and used to rapid change, a brand must have the ability to surprise and have diversity.

A brand which only has kernel attributes may have power but it will lack relevance in the minds of the intended audience.  A brand with only peripheral attributes may be relevant to the target audience but it will lack the necessary power.

The modern view of creating a brand with kernel attributes to provide solidity but also peripheral attributes which can be adapted to meet the variety expected by modern consumers.

This is where Theresa May’s campaign failed spectacularly.  It had a kernel attribute ‘Strong and stable’ but it had no peripheral attributes.  The campaign was based almost exclusively on Mrs May.  The rest of her party hardly got a look in.  So when that kernel attribute was blown out of the water by the social care U-turn, the campaign was left as a hollow shell.  If Mrs May had run a more diverse campaign, with more than a single attribute, she may have been able to ride out the social care fiasco and retain her majority.


Why ‘living the brand’ is crucial.

The traditional view of brand building is based on marketing communications; in particular advertising.  Senior management prefer advertising as they see it as a method of communication which can be controlled.  It is a one way method of communication where the advertiser is in control of the message.

Today, consumers are bombarded with advertising and other forms of marketing communication.  Increasingly, they want to interact with brands.  There is a shift from one way communications to collaborative conversations.  Advertising may sell your products but if you are looking to build a brand; the combination of attributes which gives an organisation a distinctive identity and value relative to its competitors, customers, advocates and stakeholders; you need to do more than advertise. This is especially true when you are trying to sell services where there may be no physical product to attract a target audience.

To subsist and grow, brands need to evolve through interaction.

Often, the most important element in building a brand is an organisation’s employees.  Employees are the part of an organisation which actually interacts with the outside world.  They actually speak to your customer base.  They drive customer retention.  They share knowledge and create great customer experiences.  Properly engaged, they can strengthen a brand and secure future cash flows.  Employees are essential brand stakeholders and they need to know how to engage with and understand the brand.  Employees are also consumers of brands and brand messages.  They have an inherent power to deliver brand promise especially if they are informed and enthusiastic about the brand message.

Traditionally, too many firms have seen brand messaging as a function of senior management and the marketing team.  If you are truly interested in building a brand presence, you need to spread that process throughout your organisation.  That shift requires marketing to be seen not in terms of marketing communications and promotion but as a central element in planning business strategy.  Brand building involves everyone from the Chief Executive to the production line.

Many organisations talk of internal marketing.  A process of spreading the message through the organisation using internal promotional messages.  Such an approach can be problematic in brand building.  That is why this article is headed ‘living the brand and not ‘live the brand’.  Live the brand implies the internal marketing route, senior management creating messages which tell their employees how to act and behave.  It is the ‘big brother’ approach to marketing.  Employees are told how they must behave rather than them choosing to engage with the brand and make it part of their life.  An organisation’s processes may belong to its owners and managers but its culture belongs to all its stakeholders.  All too often internal marketing is an exercise on imposing cultural norms on an organisation rather than allowing the members of that organisation choose them.

Building a brand culture is an exercise in thought which not held in common but created in common.

To drive a common understanding in an organisation two things are required, active participation amongst employees and a simple clear message.  To drive participation you must involve stakeholders from inside and out with your organisation.  The Japanese system of Kaizen does this through the use of quality circles and staff involvement in developing process improvements.  In firms using Kaizen, staff feel they are listened too and that they have an active role to play in developing their work activities.  IN traditional western firms resentment can build if staff see their ideas being hijacked or there is only senior management diktat.

Marketing staff and senior managers may understand complex marketing theories and models however shop floor staff may need a simple clear message they can easily pass to consumers.  Often such messages are clichés which talk of quality, environmentalism, integrity or innovation.  It is not the uniqueness of the words in a brand’s message which are important but the way those words are used and interpreted.  Words such as quality remain abstract constructs until staff and consumers actually experience the product.

To build a brand a Top Down/Bottom Up approach is usually required.  this is where management pass down strategic goals to the organisational stakeholders and allow these stakeholders to present plans to achieve those goals.  This is a major part of systems such as kaizen.  Such an approach can bring life to otherwise bland brand images.

Building a brand isn’t about making excellent products or having flash messages; it is about building a culture and a community.  Hatch and Shultz (2008) said “stop asking how you can get your employees behind the brand and start thinking how you can put the brand behind your employees”.  Greater commitment and creativity can be generated if a brand becomes the framework that supports employees and their aspirations.  Don’t tell your staff about the brand, make them engage with it.  Even more importantly listen to your employees, create strong and reliable feedback to create value in your brand.

Why firms use Brand Extension

The Ansoff Matrix tells us that brand extension as a growth strategy is a riskier option than market penetration and market expansion; although it is less risky than diversification.  Ansoff also stated that brand and product extensions should only take place once market penetration and market expansion opportunities had been exhausted.  So in today’s marketplace, why do so many firms choose brand extension as their primary method of growing their brand?

Well the answer is that many of today’s commercial markets are mature.  Market Penetration and expansion opportunities are scarce and increasingly costly.  Rather than starting from scratch in a new market, it is easier to enter it with an existing brand.

In his book The New Strategic Brand Management, J.P. Kapferer give advice on whether brand extensions is an appropriate strategy.  He strongly believes that in mature and luxury markets it is necessary.

Many luxury brands use extension as a core business model.  In these markets it can provide increased brand power and profitability.  This is why major names in the fashion industry introduce perfumes, luggage and watches.  Some fashion designers, such as Victoria Beckham extend their design services to products like cars.  Mrs Beckham apparently designed the interior trim of the Range Rover Evoque.

A successful brand extension relies on the business’s ability to create a distinct competitive advantage through leverage of existing reputation in a new, growing, market sector.

Kapferer argues that five basic assumptions must be met if a brand extension is to succeed:

  1. The brand must already have strong equity and a strong asset base.  Trust levels with consumers must be high.  The extension must offer strong customer benefits, both tangible and intangible.
  2. Assets must be transferable to the extension.  Consumers must believe and acknowledge that the new extension product will be endowed with the benefits already associated with the brand.
  3. Extension products must offer a real perceived competitive advantage in the minds of consumers compared to the products of competitors.
  4. The brand’s values must be relevant to the market segment into which it will be extended.  However, the segmentation of the new market should be done in such a way as to make it difficult for competitors to react quickly.
  5. The brand extension must be competitive in the long run.  That means you need to provide sufficient resources to achieve market leadership and to develop productivity.

Brand extension can also be a defensive strategy.  It can also be linked to efficiency and productivity measures.

  1. Firms use brand extension to reduce media and other costs.  Rather than the expense of separate campaigns for different products, they are merged into a single mega-brand.
  2. Some brands operate in declining product categories.  To avoid market contraction and closure, these brands need to expand into new segments.  In 2003, Porsche entered the 4×4 market.  A time when the market for sports coupe was declining.
  3. In business to business markets, brand extensions can evolve as a result of the need to provide ever-increasing customer value.  For example, a firm providing office cleaning services may begin to offer the provision and maintenance of house plants, or furniture, or art, to its existing customers.  British Gas faced new competition when the UK utilities market was opened up to competition.  They extended their base by offering domestic white goods maintenance to their existing customers.
  4. A brand’s market can be cyclical or seasonal.  Brand extension may be necessary to flatten out that cycle.  The Bill Paterson film, Comfort and Joy took inspiration from a real life  and very violent war between the operators of ice cream vans in Glasgow.  The real war was a very nasty affair between organised crime gangs who were using the vans to sell drugs.  In the film, it was a battle to preserve territorial boundaries.  The main protagonist of the film, a radio DJ played by Bill Paterson, got the competing firms to cooperate by extending their brands into the sale of deep-fried ice cream fritters which could be sold in the winter. (the film was made before the advent of the deep fried Mars Bar).
  5. Brand extensions can also be a result of a firm having insufficient resources to maintain a wide brand portfolio.  By merging brands the costs of packaging and promotion can be shared.  Scarce resources can be targeted on productivity or quality improvement.  In such circumstances, brand extension can a curse into a blessing turning a house of brands into a branded house.
  6. Brand extensions can get round promotional and advertising restrictions.  The promotion of tobacco products is widely prohibited.  Brands such as Dunhill are now as well, if not better known for their luggage and accessories than their cigarettes.  In many states it is illegal to advertise prescription drugs directly to consumers.  Pharmaceutical firms therefore extend their brand into over the counter medicines.

Brand extension can be a risky growth strategy but if you are operating in a market which is mature and meets the above circumstances, brand extension may be a better option than a full diversification.

Local Brands Can Win

Today we live in a world of global mega-brands.  The financial and business press is regularly filled with stories about the activities of brands such as Coca Cola, McDonald’s and Apple.  Only this week, the story of Pepsi’s disastrous advertisement featuring Kendall Jenner went viral.

It seems that smaller local brands are doomed and at best they will pick up the scraps of market share left to one side as these global brands continue their feeding frenzy.  Although mega-brands may dominate the column inches of business papers, there are significant examples where smaller local brands have defended their market leading role.

Did you know that the market leading hamburger restaurant chain in Korea is not McDonald’s or Burger King but Lotteria, an offshoot of a local department store chain.  Smaller local brands can dominate their market and hold off attempts by international corporations to take their market position.

It is obvious why big corporations want to expand internationally.  The Ansoff matrix tells us that it can be difficult and costly to penetrate your home market further when you are the market leader.  Governments have laws regarding monopoly positions (in the UK a firm with more than 25% market share is considered as having a monopoly).  The ability to gain market share may increase in cost exponentially.  You may be paying increasing costs to garner smaller and smaller percentages of your market.

Ansoff also states that activities such as new product development and differentiation are increasingly difficult and costly.  Market expansion is less risky particularly if you can implant your current business model into another region or state.  If you are the market leader domestically, your best option may to be to expand internationally.

So how can a local brand fight back against global brands, how can they defend their local market where the competition may have more money and resources to take into battle.

Local brands often use first-mover advantage to hold the market-lead.  They were the first to enter the sector in their local area and so become associated with that sector in the minds of consumers before other brands get a foot in.  However, brand loyalty can be fleeting and should not be the sole strategy for market dominance.  You need to work hard to retain customers rather than just assuming they will stay loyal.  If a large conglomerate provides a better offer, consumers will switch.

To develop a local market lead position you need:

  • A specific business model and specific processes.  Ideally these should match the expectations and values of local consumers.
  • To be more accessible to the local market than larger competitors.
  • You have to offer strong growth potential; and,
  • You have to have stronger local attributes than global firms

Recently, Starbuck’s attempted to enter the Italian coffee shop market.  A market the firm had so far ignored.  This was probably Starbuck’s last throw of the dice in relation to market expansion.  The last country on the list where they had no presence.  The reason why Starbucks had avoided Italy so long was that their business model simply did not fit into the Italian coffee drinking culture.  Many Italians treat coffee as an icon of their culture.  You wake up with an espresso and you certainly do not drink a cappuccino after mid-morning.  The culture is of locally run coffee bars which are as much community centres as businesses.  Starbucks had avoided Italy because the reaction to their business model was hostile.   Starbucks model does not meet the four attributes listed above in the minds of Italian coffee drinkers.

Other activities by large brands may be treated with hostility.   Take the example of Waterstone’s, the UK bookshop chain.  They opened stores in small rural towns which outwardly gave no indication that they were part of the chain.  Consumers felt tricked by this practice.  They reacted strongly to the strategy feeling Waterstones were trying to pass off their chain as local independents.

Often small local firms exhibit significant limitations:

  1. They show a lack of willingness to innovate
  2. They have self-imposed inertia.  They look to the past not the future.
  3. Their resources are too widely dispersed. They try to be all things to all consumers.  They ignore Porter’s generic Niche strategy.
  4. They rely too heavily on customer loyalty as a driver of customer preference.
  5. They are self restricting.  They do not enter new markets because they feel they are dominated by a global brand even though clear opportunities exist.
  6. They don’t appear to be local and try to copy the practices and attributes of global brands.

For local brands growth strategies do exist.  Some local brands succeed by dominating a single distribution strategy (such as direct sale/mail order).  Some merge smaller brands to make one larger brand more able to defend against the international mega-brands.  Some nurture innovation, others look to target expansion into markets which have similar characteristics to their home market.

Despite the dominance of global brands in our interconnected world, it is possible for local brands to succeed and to lead in their local market.

Why your Brand is a Strategic Asset

A couple of days ago I was perusing Twitter when I saw a tweet advertising a graphic design firm.  The tweet was promoting the creation of company logos and implied that to create a brand, all you needed was an up-to-date logo.

This is, of course, nonsense.  A brand is far more than a name or a logo.  As I have previously shown in this blog, brand names and logos are just one element of the brand identity prism, part of its physique.  Your brand also needs to develop a personality and culture. It should reflect the aims and ideals of the intended customer and reflect the relationship between customers and the brand owner.

Companies, if they are to be successful in the long-term, need assets which can provide longlasting competitive advantage and value. Today, the pace of change in markets can be extremely rapid.  Markets can move quickly, timescales are contracting.  Assets which can provide such long -lasting advantage include things like research and development capacity, developing a customer orientation, encouraging employee involvement, maximising efficiency and brands.

If you examine the activities of some of the most successful businesses in the world, you will find that they place great importance in protecting and developing assets which provide long-lasting competitive advantage and they do so in such a way as to adapt to ever-changing market conditions.  These firms know that if customers are to be retained, and their loyalty ensured, they need strong brand identities. Loyalty is not based on price points or bargains.

Our modern society is materialistic.  People want to put meaning onto their consumption.  This requires brands which tell a story and that story should reflect the values and perceptions of its intended purchasers.  You need to reflect both tangible and intangible buyer values. Your brand must deliver meaning.

Brand building requires more than just ‘Branding’.  This may seem paradoxical but brand development is about more than communication. To fully develop a brand, you need to plan its development across all of the marketing mix.

Consumers also expect brands to maximise their delight.  They want to feel empowered and have their expectation more than simply met.  It is about providing consumers with ‘best value’.  This is a crucial mix of values, not simply providing the lowest price.

Simply owning a logo or a name is not providing consumers with a brand.  You also need to treat your brand as a strategic asset. This requires careful planning and constant vigilance on the adapting market environment.  Philmus Consulting can help your firm to develop strategic marketing plans which make the most of your brand’s value.