Wednesday, July 28, 2010

Toyota's Brand Problems Begin At Its Core

-Mark Ritson


Recently Toyota's Japanese president, Akio Toyoda, faced a US-style dressing down when he appeared before a Congressional hearing in Washington DC.

However, irrespective of how well Toyoda answered his critics, and even if all Toyota's design flaws are remedied, its problems are only beginning.

Once one of its main advantages, Toyota's brand architecture is about to become its biggest strategic problem. Like many other Japanese companies, Toyota has built its business from an almost exclusive focus on a single corporate brand. It also markets Lexus and Scion, but most of the company's sales are derived from Toyota sub-brands.

That concentrated approach has distinct benefits. It fostered the single, united culture that was so important to Toyota's success. It also allowed the company to pump all its marketing investment into the Toyota master-brand rather than its sub-brands for greater marketing efficiency.

Perhaps best of all, the single brand reduced the number of components needed, as its sub-brands shared a significant number of common parts. Compare this approach with US rival GM, which, until recently, was operating a house of brands structure with 11 distinct marques, and the reason for much of Toyota's success and GM's decline, becomes apparent.

Every brand architecture, however, has strengths and weaknesses, and Toyota is about to learn the downside of the one it has adopted. Focusing on a sub-brand approach, in which most of its cars are linked to a single corporate brand, means that a problem with any vehicle at Toyota will not only affect sales of the model in question, but also spread across the whole range.

We have known this since 1990, when Professor Mary Sullivan used quantitative modelling to demonstrate the impact of brand architecture on automotive sales. Then, Audi was struggling with in its accelerator problems. Sullivan showed that the resale value of the Audi 5000, which had been involved in a number of fatal accelerator accidents, declined significantly as a result.

No big surprise there. However, she went on to show that the other brands in Audi's stable were also affected to varying degrees, depending on how close they were to the 5000 in the company's brand architecture. Despite never having a quality problem, the Audi 4000 lost significant resale value and so, to a lesser extent, did the Audi Quattro. Crucially, despite being part of exactly the same company, VW's sales in the US were not affected at all.

The lesson for Toyota is that every one of its sub-brands, even ones it has yet to launch, will now be tarred with the same brush. This is not just a matter of perception. Because the marque has led the world in using shared parts and technologies across multiple models, a technical hitch with one car also means problems with others. Suddenly putting all its proverbial eggs in the same basket is looking like a really bad move.

There is one more lesson from the Audi experience for Toyota. Audi's US sales dropped by almost three-quarters and, despite massive sales promotions, remained below their pre-crisis levels for the next decade. Even after research confirmed that Audi's accelerator problems were caused by driver error and not manufacturer mistakes - the brand still struggled to recover its position.

For Toyoda, fixing his products' problems is a big job. Handling the fall-out from angry consumers even bigger. However, because of brand architecture decisions made more than 60 years ago by his grandfather, his toughest job still awaits him.

Wednesday, July 14, 2010

How Brands Should Appeal To Women

-Dr. Bob Deutsch


In my work as a cognitive anthropologist I study how the mind works, how people "make meaning," how people form attachments to things (brands), and how people make decisions. Decisions like how to select what to invest in, whether stocks or mates; why and under what conditions, people prefer Coke over Pepsi (or vice versa), Charmin over Cottonelle; why a person believes in one God over another.

In that search I have inadvertently uncovered something about viva la difference: WOMEN CYCLE, MEN CONSUMMATE.

Marketers need to understand the implications of this difference.

The male is oriented to the present, the concrete, the visual, the "hit," the win, the "me." Evolutionarily speaking, the male must bring home the bacon. No Dilly-Dallying. No excuses. The male is in the now and, above all else, is a pragmatist.

The female is oriented the conceptual, to underlying dynamics, to the relationship between things, and to stability over the long-term. The female understands and sees patterns over time.

Males act and say things like: "You've got to act, you can't wait too long." "You must know how to look at the environment, know what the data and specs mean. Then pounce." "My goal is feeling powerful and getting peoples' attention."

Females act and say things like: "It takes time to have things in order." "I want to feel good about where I am and what I've done." "My goal is continuity, building positive relationships, and long-term stability."

A Seattle couple that started a small business together have different ideas about inventory. Wife: "I live to reinvest in inventory when I have cash, so I can buy stuff off-season and sell it next year at a bigger profit. I also like to have inventory just as a customer service." Husband: "Get rid of inventory as fast as possible."

Male: Do what you set out to do and finish the job. Female: Evolve.
Male: Achieve. Female: Experience.
Male: Stay on top of things. Female: Create good relationships.
Male: Get the biggest piece you can. Female: inner peace.

Females want to understand things and want to be understood. Males are more focused on explanation.

Explanation entails seeing the world as governed by finite laws that humankind can direct through successive approximations. Understanding requires comprehending meaning from the inside out, in its unfolding. To understand, the world can't be approached from solely an intellectual stance.

In general, the two genders have different ways of perceiving causality, time, and power. This implies seven principles for making your brand more appealing to women:

1. PATTERN, not just point. Recognize that women have the ability to perceive more than the metric of a product attribute or an instance in time; they appreciate the underlying pattern (idea) that gives rise to the fleeting moment.

2. AUTHENTICITY, not just immediate appearance. Recognize that persona, biography (or history), and current contingency must all be factored in, and that universal principles underlie particularities.

3. QUALITY, not just quantity (size). Recognize that for women bigger and more is not necessarily better; and that a steady build is often better than an impulsive response.

4. CONNECTEDNESS, not just individuals. Recognize that communality can reign over dominance. We are all bound together.

5. SOCIETY, not just markets. Recognize that markets are numbers, and that markets can be counted and the goodies duly noted. But numbers are not people. Women are people and people have personal feelings and social intentions.

6. QUALITY OF LIFE, not just accumulation. Recognize that there are material and spiritual needs made up of individual wants and musts, but that are cast in the context of a social matrix.

7. REASONABLENESS, not extremism or absolutism. Recognize that all issues have grays, and exaggerations to one side or the other only cover-up the reality of subtlety and nuance.

Marketing to women is not as easy as 'pretty in pink' or 'basic black'. But knowing the inner reality of women can help marketers feel more in the pink and put them in the black.


Seven Critical Factors Of Brand Strategy Success

-Derrick Daye


The following seven factors continue to rule the day for building leading brands:

Organization Support

•CEO leadership & support

•Distinctive corporate culture that supports brand promise

•Ability to obtain support from a broad spectrum of employees

•Alignment of brand messages across functions

Brand Presentation

•Strength of brand identity system

•Effective use of visuals/imagery

•Ability to capture the brand in a slogan

Measuring The Strength Of Brand Identity

-Derrick Daye


Ever wonder what is really behind this thing we call "identity? "

It's one of those words that attracts a variety of meanings, ranging from a company's name and logo, to its business definition (Fuji: We're a digital imaging company), to its image in the marketplace, to its values.

Sometimes, executives manage to go a level deeper and talk about identity, their company's, and even their own, as the unique characteristics that define how they create value in the world. From this vantage point, identity provides the seeds of differentiation. Ahhh. I think these guys may be on to something.

It doesn't matter what business you're in; if you're going to successfully re-shape your brand, you need to start by knowing who you are. This imperative isn't just a nice-to-have; it's a must-have, which we discovered recently through a research study, the Identity Impact Survey, that quantitatively demonstrates the impact of identity strength, organizational and individual, on employee engagement and business performance. The key findings of the survey, which included nearly 2,000 participants across five diverse companies and industries, were dramatic.

Increases in identity strength translate into predictable increases in revenue and other economic benefits.
Organizational identity strength is more influential than individual identity strength in driving employee engagement and business performance. Their combined effect, however, is greater than either one alone.

Although organizational identity emerges as a prime performance driver, employees don't typically think that their organization actually has a strong identity.

The last finding made me shudder: Organizational identity strength has a major impact on performance, but most people don't believe their company has a strong identity. Now, there's a gap to be reckoned with! The implications get worse. What we found was that for all the innovative workplace activities companies use to boost engagement, better relations with one's boss, more recognition, more work-life balance, none of them can make up for low identity strength. What's a smart executive to do?

That question brings me back to brand. If there's one management portal companies have for building identity strength, it's their brand. Not brand as a measure of consumer attitudes, but brand as the vessel that links the company's identity to how it goes to market, starting with how employees contribute to building brand success. Call it branding from the inside-out, rather than outside-in.

Our research offered many insights into the power of identity as a performance lever that executives can actually control. One of the most useful analysis in this regard was determining where identity strength comes from. What we learned is that it comes from eight building blocks, which constitute the primary "muscles" that account for identity strength and resultant business performance.

These building blocks of identity include: autonomy, differentiation, change, stewardship, purpose, alignment, brand and sustainability. While brand is ultimately only one of eight factors, it is still the best place to start when seeking to build identity strength. That''s because brand reflects, and affects, all parts of the business, simultaneously. (Just ask Starbucks, Toyota, IBM or Disney.)

One of our aims in conducting the survey was to develop a yardstick to measure identity strength, and its performance ramifications, in one number. Thus, was born "IdentityiQ." Derived from the dynamics of human IQ testing, this simple yardstick gives executives a quick, clear read on performance that can be linked to strength or weakness on several key leadership measures including:

- Current financial performance
- Strategy deployment
- Innovation
- Brand
- Culture
- Investment value

What we've learned about identity strength through our research can reshape how companies approach their branding challenges. And it can give business leaders a new way to address employee engagement and business performance.

Someone once asked me who my heroes are, professionally speaking. After a bit of thought, and naming my usual suspects- Peter Drucker, Abraham Maslow, Jim Collins - I came up with one more; maybe the oldest brand consultant in history: Socrates, who famously said, Know Thyself. He was right. That's where success begins.

Brand Research and Neuro-Linguistic Programming

-Derrick Daye


Focus group participants are often inspired to articulate themselves more fully and accurately than they could have alone. Any moderator worth his or her salt does this daily, without consciously using Neuro-Linguistic Programming (NLP) techniques. Many focus group moderators instinctually mirror a participant's representational system when asking a follow-up question or eliciting greater depth from a projective exercise.

Want a participant to keep talking? Then probe in the language of his or her sensory modality.

Sensory Modality and Participant Verbatims

Sensory modalities are part of a NLP model that identifies patterns in how people externalize the information they are processing. When participants talk, they often speak from a state of mind that is more closely aligned with one sense over another. For instance:

Visual That's a bright idea. I see how I can use the car's extra space.

Auditory I hear how this makes sense. Let me tell you — this is a winner.

Kinesthetic How fast can I accelerate? I feel like this car was made for me.

Olfactory Smells like a winner. Some ideas stink, but this is coming up roses.

Gustatory That new car looks yummy. It has the fine flavor of elegance.

When you hear someone speak in a particular sensory modality, and you ask questions in that same modality, the person is more likely to continue talking than if you ask a question in a different sensory modality. You are also more likely to get a congruent answer and more likely to keep the participant engaged.

We can see inside participants' minds — and know how they are processing information or which parts of their brain they are accessing — by their eye movement. Have you ever noticed how a participant's eyes move when you ask him or her a question? Try this sometime soon... Ask someone this series of questions:
  • What did it look like the last time it rained?
  • What are the lyrics to "The Star-Spangled Banner"?
Then, watch the person's eyes. His or her eyes will most likely go the same direction each time, because both questions solicit a recollection. Chances are good that the eyes will go to the right (the person's left) after each question because approximately 85% of the Western world's population that has been tested accesses memories by looking to their left. If you want to see a more subtle distinction, when you ask someone to recollect a visual, the person will likely look up and to your right. If you ask someone to recollect a sound, however, the person will likely look directly to your right (his or her left) along a horizontal plane. Here are questions that are a little trickier.
  • Please imagine a purple elephant with big orange spots.
  • Can you see it?

Most people have never seen such a critter. Their eyes will go back and forth (their left to their right) as they try to remember the components in Vr and then construct the new variant in Vc. Sometimes, an indication of a fib can be seen when a person only looks up to Vc in response to a question that should be easy to recall. Example: What was the party like last night? If the response is all in Vc, perhaps the person queried never attended or was so drunk that he can't remember. You should always test your assumptions. For practical purposes, when you see someone's eyes move, you can often infer how that person is accessing what he or she knows.

As a focus group moderator, if you ask a participant about buying a new car and you see her eyes go up, you might ask what she looks for because her eyes going up revealed that she was seeing pictures in her mind. Similarly, if you ask a participant about buying a new car and you see her eyes go horizontally, you might ask what she listens for, because her eyes going sideways revealed that she was hearing words or sounds in her mind.

Again, you need to test your assumptions. Lefthanded people often have reversed eye movements from the general population. Some people move their entire head instead of moving their eyes. Important note: Someone leaning back with his eyes staring at the ceiling may simply be accessing the visual part of his mind. You can test whether he is tracking with you by asking, "What do you see?" If his head shakes before he answers, he was probably daydreaming; however, if he keeps staring as he talks you through what he is seeing, chances are he needs to look up to fully access his ability to visualize. When you speak into a participant's primary modality, you make it easier for that person to share what's inside his or her head. Sometimes, the results can look remarkable. People reveal themselves in ways they normally would not.

Neuro-Linguistic Programming

NLP is based on the remarkable work of Dr. Milton Erickson, who was widely recognized as the foremost hypnotherapist of his time. Dr. Erikson was able to ingeniously structure sentences full of vague meanings to help his clients discover how to address their problems and the resources that they already had available to them. His success was based on his ability to read non-verbal behavior (sensory acuity), his ability to establish rapport with his clients, his skill with language patterns and his beliefs about his clients. Bandler and Grinder, the founders of NLP, studied Erickson as part of their development of their approach to working with people.

Here's a famous illustration of Dr. Erickson's work. A twelve-year-old boy was brought in to see Erickson about bedwetting. Erickson dismissed his parents and began talking to the boy about other topics, avoiding a direct discussion about bedwetting altogether. Upon learning that the boy played baseball and that his brother had played football, Erickson elaborated on the fine muscle coordination it takes to play baseball, compared to the uncoordinated muscle skills used in football.

The boy listened raptly as Erickson described in detail all the muscle adjustments his body automatically makes in order to position him underneath the ball and catch it. For instance, the glove must be opened at just the right moment and clamped down again at just the right moment. When transferring the ball to another hand, the same kind of fine muscle control is needed. Then, when throwing the ball to the infield, if he lets go too soon, the ball doesn't go where he wants it to go. Likewise, letting go too late leads to an undesired outcome and, consequently, to frustration. Erickson explained that letting go just at the right time gets the ball to go where the player wants it to go, and that constitutes success in baseball.

Therapy with this young man consisted of four sessions that included talks about other sports, Boy Scouts and muscles. But bedwetting (which is often a muscle-control problem) was not discussed, and "formal hypnosis" was not conducted. The boy's bedwetting disappeared soon thereafter. Some of Erickson's tenets appear in the list of NLP Presuppositions. For example:

  • Every behavior has a positive intention.
  • This is the best choice available to a person, given the circumstances as he or she sees them.
  • Respect the other person's model of the world.
  • Resistance in a client is due to a lack of rapport. There are no resistant clients, only inflexible therapists.

Erickson also used a technique that has been labeled "Pacing and Leading" in NLP. He would start by subtly mirroring a client's physical expression as a way of creating rapport. Think about how a baby delights in being copied. On some level, we all feel "seen" and understood when another person gestures the way we do or uses the same speed of talking and type of language.

Once he established that connection, he would begin to lead the client into a different space, generally what hypnotists call a trance or downtime, where the person is encouraged to explore his inner world. (In NLP terms, uptime is when your senses are focused on the outside world, while downtime is related to your inner thoughts.) As we go through our daily activities, we are continually cycling through uptime and downtime and are often somewhere in between.

So, to pace a respondent, begin by matching her postures and gestures, choice of verbs, tone of voice, etc. Once the connection is made, you can change the tempo and sensory system to elicit responses from all senses — e.g., what did you see, hear, feel, smell, taste or think?
This is particularly helpful in any guided imagery exercises you may design. Clients are amazed when respondents report on the colors they saw and the scents they smelled in their reveries.


Brand Building and Emotional Benefits

-Derrick Daye


People buy benefits rather than features.

For example:

Time-release (feature) products are purchased because they are long acting (benefit).

Clear bottles let us see the purity in color and consistency of waters.

Dissolving tablets allow us to take medicine on the go.

Roller ball pens write faster.

Rubberized handles on scissors provide a sure grip.

And many marketers would agree that we buy products and services that enhance our positive sense of self-esteem, in some way. They believe that all brands, products and their features are associated with a rewarding emotional payoff. Moreover, all features and benefits are linked to emotional end benefits.

Think of iPod, BlackBerry, Fiji Water, Poland Spring, Mercedes, Ford, Starbucks, Dunkin' Donuts, Hershey, Godiva, Tiffany, Kay, Disneyland, Maui. We seek out these brands with their USPs, features and functional benefits because we like the way they make us feel and what they allow us to communicate about ourselves.

Claritin quick-dissolve tablets ladder up to sharp thinking and insightfulness.

Fiji's clear bottle and purity communicate a sense of spirituality.

Time-release analgesics allow us to accomplish more.

Alarm systems sell because people want to feel safe and secure.

Mercedes appeals to a need for recognition.

iPods sell because people want to feel a sense of belonging.

iPods also sell because people want to show how smart they are.

Woody Allen appeals to people who like feeling sophisticated, brainy and unique (if not uniquely neurotic).

But let's backtrack for a moment. People get confused between emotions and emotional benefits. There is an important distinction between them.

The Differences between Emotions and Emotional Benefits

An "emotion" is best defined as a state of physiological arousal to which we attach a cognitive label. There are only four core emotions " mad, glad, scared and sad.

Of course, there are various gradations, combinations and shades of gray regarding all of the four core feeling states. Sad includes disappointed, gloomy, heart broken, distressed, etc. Mad includes frustrated, raging, bitter, annoyed. At an even simpler level, we either feel "good" or "bad." (How often have you been frustrated in a research project when someone responds to your sensitive plea for his or her feeling response by energetically answering, "It makes me feel good/better/great/wonderful!")

Knowing how our brand, features and functions or brand activity (concepts, advertising, names, taglines, etc.) makes someone "feel" is only minimally useful. We definitely want to know if our new commercial makes people feel "glad" or "bad,"but that is ONLY a measure of valence; it does little or nothing to lend direction to our creative efforts. It tells us nothing about how to set the mood and tone for our advertising or even necessarily how to FIX any bad feelings that emerge.

It is the "emotional benefit" and not the raw "emotion" that is most informative, motivating and useful for brand development. An emotional benefit, not a physiological state of arousal with a simplistic label, is an often complex, positive, cognitive statement that our respondents are able to make about themselves due to their use, display and attachment to our brand and its features.

More succinctly, an emotional benefit is nothing more than "something nice I can say about myself because I use your product or service."

The critical differences between emotions and emotional benefits are:

Emotional benefits are entirely cognitive, whereas emotions include a state of physiological arousal.

Emotional benefits are specifically attached to brands, their particular features and marketing applications. In contrast, emotions are more diffuse human physiological reactions with a limited set of simple labels.

Emotional benefits relate directly and powerfully to enduring self-concept, while emotions are more closely associated with temporary and instinctual physiological reactions.

This last distinction is most important, and it most closely identifies the reason that emotional benefits are so vital to branding.

Emotional marketing helps us link our brand to our target's enduring self-concept. We want a lifetime relationship with our target, and this is possible only if we understand our target's core values.

A vital brand has a "relationship" with loyal users not unlike a healthy relationship between two people. People maintain ongoing affiliations as long as each person in a relationship feels as though the other contributes positively to his/her positive sense of self. Relationships fall apart when perceived negatives begin to outweigh the rewards of the association. For example, being coupled with a successful friend casts a positive halo onto someone who values success.

Of course, in branding, we are a little more limited in providing emotional benefits than we are in our actual human relationships because there are only certain elements of self-concept that we can viably support with a brand. Our self-concept is admittedly constructed of much more than just the brands we buy or the brand features that attract us. Nevertheless, it is this very ability to support self-concept that is the most potent glue available for branding.

The Impact of Emotional Benefits

Now, armed with this more precise definition of an emotional benefit, let me proceed to discuss exactly how emotional benefits influence purchase and branding. Emotional benefits, although mostly unconscious, are attached to specific elements of a brand and to the brand itself as a whole.

You can actually think of them entirely without reference to the word "emotion" and remain fully in the rational sphere, if you prefer, because really it is just the "kind of person" that a particular rational feature supports. The emotional benefit/ value is the adjective describing the self:

I am an attractive person because I chose this particular long-lasting lipstick.

I am a productive person because I because I purchased a BlackBerry with a fast microprocessor.

I am a sexy person because I drive an aerodynamic car.

I am a powerful person because I bought a rowing machine from an infomercial with that muscular guy.

I am an energetic person because I replenish electrolytes after exercise with Gatorade.

A brand, then, becomes nothing more than the profile of self-concept-supporting statements that people make via their attachments to its features and advertising/messaging.

There are two more important points.

The first is to answer an extraordinarily common objection to emotional brand research. The objection is that certain categories are purely rationally driven and preclude emotional branding. This is highly debatable, given our above understanding, because EVERY rational feature is desired for the support of some aspect of self-concept. EVERY LAST ONE!

Let me prove this to you by taking the most extreme example. Consider, for a moment, a market that is known to be driven entirely by price sensitivity (we shudder to think!). In such a market, according to the "I don't need to do emotional branding" theory, competitors believe they need to compete only via their respective abilities to keep their cost structure low and progressively out-bid each other in a pricing war. (Disastrous, of course, but that's another topic.)

This is not the case, however, because there are emotional benefits attached to price, and these emotional benefits will differ depending upon the particular market and category that you are assessing.

For example, there are two primary emotional benefits we have found to be associated with saving money. One is freedom; the other is security. Doing emotional branding research to understand which one is more important to your market, to what extent this is the case and how these emotional benefits might attach to other aspects of the brand would lead to very different approaches for the creative mood and tone of brand messaging. (Clearly, we would want to talk differently to people who most desire freedom than we would to people who most desire security). Herein would lie the competitive branding advantage in what the rest of the world viewed as a virtually unbrandable, price-driven commodity!

The same argument can be made for the use of emotional branding in pharmaceuticals. Suppose all drugs in a category have virtually equal efficacy; let's say, in antihistamine response. The marketer who knows what emotional benefits underlie antihistamine response is in a competitively better position to set the mood and tone of advertising that will attract the physician's attention. (Physicians of different specialties also tend to have different personality needs, which can also be assessed via indirect techniques and leveraged in marketing.)

The last point (which also answers a common objection to emotional brand research) is this. Emotional benefits are able to wield their influence precisely because they work behind the scenes, beyond the awareness of the customer. It is the very fact that they are so elusive and hidden that makes them so very powerful and persuasive.

If you were to read the above benefit statements (e.g., "I am a sexy person because I drive an aerodynamic car") to a respondent directly and ask for levels of agreement, you would get a much lower level of agreement than is, in fact, the case, and market behavior would differ greatly from what you tried to evaluate in your study. This is because of four major obstacles to asking questions directly.

Social Desirability Bias: the fact that respondents prefer not to reveal certain emotional motives to interviewers, nor sometimes even to themselves.

Rational Purchasing Consciousness: the fact that respondents prefer to believe that they make decisions based upon purely objective and observable criteria about the product or service at hand. Emotional motivation threatens this belief system. (Indeed, this is why so many people say that advertising does not affect them, despite the industry's willingness to spend billions each year.)

Fear of "Hidden Persuaders": many respondents fear that if we really knew what made them tick, we would take advantage of them and sell them things they don't really need.

And, again, the Presence of Emotional Motivation is Beyond Conscious Awareness.

Because of all of the above, emotional motivation usually operates below the surface, beyond the ability of respondents to easily access and articulate. These obstacles hold true even more so for respondents in medical marketing research and business to business, where the professional positions are held by the decision-makers (physicians, purchasing dept. executive, etc.), who are taught to base their decision on the facts and dismiss their emotionality and personal response.

People do not want to believe that they are emotionally influenced towards brands or purchase. They find the idea repugnant and aversive. That is why many qualitative researchers encourage the use of projective techniques to overcome these obstacles.

The fact that people do not want to admit to using brands as a method of partially supporting their self-esteem forces these associations out of consciousness, and it prevents people from cognitively reasoning about emotional benefits or articulating them out loud. And it is THIS fact "that our consumers erect a strong barrier, preventing them from becoming aware of or admitting the influence of emotional benefits" that makes them so incredibly powerful.

Language is the food of the intellect. Without language (cognitive or symbolic representation), logical reasoning is much more difficult, if not impossible. When a thought is put into language and made conscious, a person's adult mind is able to make adult, rational decisions. In our analogy, when the consumer becomes conscious of the emotional benefit, it becomes somewhat nullified because they then say to themselves, "Oh, I'm being ridiculous. Buying this product doesn't really make me a different person."

The point is, though, that most customers don't allow themselves to raise emotional benefits to this level of consciousness, so the impact remains.

In fact, many brands make the mistake of raising the emotional benefits to a level of awareness that takes away their power. They try to FORCE the psychological insight benefit by telling the consumer directly. This doesn't work nearly as well as INDIRECTLY communicating these benefits via an emphasis on specifying the features and functions of the brand that support them, while the creative mood and tone of marketing applications convey the emotional benefit.

The mind likes to have to work to solve the mystery (aiding recall and attention), and by not forcing the consumer to recognize that they use your brand to support their self-esteem, you permit them the grace of ignorance (to maintain their rational purchasing consciousness, avoid admitting socially undesirable motives, etc.). Emotional-benefit motivation is knowledge for marketers, not consumers yet another reason to utilize projectives and psychological exercises to delve beneath the surface.

The ultimate end emotional benefit/ value is always enhanced self-esteem. That, however, does not give creatives and marketers a handle to hang their campaign on. Instead, it is the rung just before positive self-worth that provides insight and gives direction to advertising and marketing.


Tuesday, July 13, 2010

What Is A Global Brand?

-Brad VanAuken


Global brands are brands that are recognized throughout much of the world. Companies intending to create global brands need to do the following:

· Identify the relative attractiveness of each market for your brand

· Conduct attitude and usage studies in each country in which you are considering entering

· Identify the sequence of brand launch by country/region of the world

· Know the category and brand indices in each country in which your brand operates

· Establish a branding scorecard that can be applied country by country

· Agree to which decisions are made centrally and which ones are made locally

· Through research, understand if there are any parts of your brands identity that wont work in a given country or for a give language. Consider the name itself, the symbols, the colors, the tagline, etc.

To some small degree, with the pervasiveness of the Internet, all brands that are in cyberspace have the potential to become global brands, however being on the Internet does not guarantee top-of-mind awareness or distribution ease. A comprehensive, well-funded and well-executed global marketing plan is required for successful global brands.


The Fall Of The Purchase Funnel

-Derrick Daye


Once upon a time people lived in a state of positive expectations. There were relatively few products, great demand and most products enjoyed high brand differentiation. This was circa 1960, when most marketing models in use today were developed, like the purchase funnel, which measures advertising effectiveness.

The world has since changed dramatically. And, despite the rise of digital and the economic downturn, most old marketing axioms are still operative, miring marketers in an approach designed for a bygone era.

Take the relationship between supply and demand - its reversed. Today demand is scarce, supply plentiful. Second, over the past half-century we have learned so much about how people engage with brands.


We now understand that people are not two-dimensional datum to be manipulated by coupons or the latest hot-button offer. Current anthropological, linguistic and neuro-scientific evidence demonstrates that humans attach to things (product, person or idea) through a process of identification that coalesces longings at the personal, social levels.

Human behavior cannot be comprehended by the old-school logical conceptions of action. What Don DeLillo said about how he writes a book is true for life, "Things begin to happen just outside the range of the immediate action. There's very little sense of logic behind it.''

Life, No Straight Line
Now that we agree life is not a straight line, marketers need to accept tools that address reality. Case in point, the Purchase Funnel, a guest that attends most new business meetings: Awareness, Consideration, Preference, Action, Loyalty. But people Are Not Linear.

When one considers consumers as people, one immediately appreciates that logic is a puny force in the face of emotion and belief. Identity trump interests and narrative transforms products into relevant stories crafted by one's own brand of meaning. In this cuisineart-like, improvisational, non-linear process, awareness does not precede consideration, then tumble into preference and finally into action.

Zig-Zagging to Attachment
In actuality, the attachment process carves a zigzag route in the service of emotional reasoning as people make symbolic associations with what is familiar, participatory and self-expansive in their image of the product. Only if and when the product is successfully transformed into a personally meaningful idea, does manufacturer reap the benefit of one's loyalty to self. This process can take time, or immediately convulse, but the best a marketer can hope for is a spasm of sentiment that bears no logical relationship to product attributes.

Note what two people say about Apple's iPhone. "Apple is a smile. It makes me smile. I'm a happy person. Apple and me are the same." "The iPhone, like Apple, is a circle, it's smooth and glides. It's easy and feels good. All other phones are boxes; they have corners and squares, are highly structured, have many rules, are too technical and linear. The iPhone is fun and natural and let's me do my own thing."

Purchase Funnel vs. Yellow Brick Road
The emotional logic of human longing is as merciless as the laws of gravity, but more curvaceous. The time is right for marketers to come to terms with the meanderings of authentic life, and reflect back to people their true nature: poised and unsettled, majestic and mundane, courageous and hesitant, marooned and moored, tough and tender.

Only then will marketers share in attracting people while, at the same time, having people soar.

Marketers must respect people as curvaceous souls, and supplant the purchase funnel with the idea of The Yellow Brick Road. This will both re-humanize advertising and make it, again, a cultural act. Then people may incline towards more products and once again love advertising as they did in the era of Bill Bernback and David Ogilvy.

Contributed to BSI by Dr. Bob Deutsch, Brain-Sells


The Chief Marketing Officer – A New Boardroom Role

-Martin Roll


The Chief Marketing Officer (CMO) has become one of the more commonly talked about corporate designations in recent years. Given the tremendous marketing potential offered by the new media and proliferation of distribution channels, companies have begun to realize the huge potential of marketing in guiding corporate level strategies and substantially contributing to the financial bottom line. In spite of such an understanding, it is startling to note that the average tenure of a CMO is merely 23 months compared to a CFO that typical lasts 4-5 years on average.

Further, not many companies have a senior marketing representative in their C-suite. This begs the question – do companies need a CMO or is the role of a CMO a mere hype? This article probes this question and offers companies some guide posts for better strategic directions.

Why do companies need a Chief Marketing Officer?

As the business landscape evolves, marketing also evolves into an organization wide strategic discipline. Given marketer’s knowledge of the customers, it is imperative that the CEO and the corporate board have a representative of the customer to continually educate them. Additionally, companies need a strategic CMO to benefit from:

Align marketing with the corporate business strategy: Newer technology, powerful channel partners, and empowered customers have made the competition highly intense and marketing a very involved and strategic discipline. Marketing can no longer be confined to the 4P framework. Marketers, with their in-depth knowledge about markets and customers, should act as a major resource for strategy formulation. In all issues of corporate strategy – what markets to compete in, what segments to target, what entry mode and strategy to adopt, which partners to strategically ally with – marketing offers substantial information. In order to convey these holistic perspectives, it is imperative the marketing is represented by the CMO in the corporate boardroom who can speak to the directors and the CEO in their language.

A classic example is of the iPhone from Apple. Given the tremendously successful iPod and iMac, Apple could have become complacent. But the marketing acumen of the executives recognized the need to constantly excite the customers. Further, they built their growth strategies on satisfying the unmet needs of the customers. Marketing played a crucial role in guiding Apple’s corporate strategy.

Connect the corporate boardroom with the customer: As Peter Drucker said, the only two functions of any organization are innovation and marketing. Irrespective how innovative a company is, how committed the employees are, and competent the top management is, unless the company connects with the customer, success will be elusive. The top management should constantly evaluate their strategic decision in the context of customer feedback - what do the customers’ value and how can the customers help the company in co-creating value.

CMO plays a crucial role in constantly updating the boardroom and the CEO about latest customer preference, how well the corporate resources are aligned to meet hose evolving customer needs. Companies such as Levis Strauss, Sony, Toyota, Nike and Singapore Airlines are some of the pioneering companies that manage to constantly feel the pulse of their customers. As such, the marketing takes a central role in guiding the corporate strategy by having the top management team and the CEO regularly updated about customers and markets.

Create a customer centric organization: Given the innumerable choices that customers have, ensuring long term customer loyalty and sustainable competitive advantage becomes highly challenging. The difference between the successful companies that achieve those objectives and those who fail is the corporate orientation. Customer oriented companies design and operate every aspect of the company with the customer in mind. To build a customer centric organization requires a highly concerted effort of all functions within a company along with every employee becoming a customer champion.

These issues deal with organizational culture, organizational structure and corporate policies. The CMO can influence the boardroom and the CEO to implement measures that would allow to build a customer centric organization. Banyan Tree Hotels and Resorts is a classic example that showcases such a customer centric philosophy. The founder has managed to instill a culture that allows constant interaction between marketing and other functions with the company. Such an emphasis has resulted in world class resorts that always manage to delight the customers.

From this discussion, it is evident that CMOs are strategic requirements of any corporate boardroom. But in spite of such a significant role played by the CMO, companies have not completely embraced the concept of a CMO. The next section discusses some of the main challenged faced by CMOs which make them vulnerable to boardroom dislike.

Challenges faced by the CMO

The challenges faced by the CMO are the problems increasingly faced by marketing as a discipline off late. It has been long argued that one of the fundamental challenges of marketing that has undermined the credibility of marketing, threatened the standing of marketing within a company, and even threatened the existence of the very discipline as a distinct entity is marketing’s failure to quantify its outcomes and justify investments into marketing activities.

The three main impediments in this regard are: (1) Relating marketing activities to long-term effects; (2) Separation of individual marketing activities from other actions and (3) Use of purely financial methods for justifying and benchmarking marketing investments. As such, CMOs are not given the opportunity to participate in the strategic decision making of the company. Two such daunting challenges are:

Measuring marketing outcomes: Marketing fundamentally differs from other functions with a company like finance or operations in a couple of aspects. As marketing deals with people, their attitudes and eventual behaviors, they are not as predictable as a machine process. As such, there can be considerable time lag between marketing actions and the intended outcomes. Further, measuring these outcomes will have to involve both financial and non-financial metrics. Given these underlying challenges, it is often challenging for the CMO to convince the top management of marketing’s ability to competently allocate resources and significantly contribute to the company’s growth.

Explaining marketing’s centrality in a company: Many companies continue to equate marketing with advertising and sales. But marketing has long evolved from being a tactical departmental function to an organization wide strategic discipline. Given marketers’ knowledge about customers and other stakeholders, marketing plays a central role in leveraging the internal capabilities. But to assert such a central role within any company, marketers should be able to understand the different aspects of the company, its strategies, its resources and its limitations. Marketers usually are involved in their own jobs and fail to leverage their centrality in a company. CMOs face immense uphill task in educating and convincing the C-suite of their capabilities and their rightful status.

The CMO and the corporate boardroom

Given the rather strong antipathy towards marketing within any company and especially within the top management team, CMOs should keep up with time and optimally utilize every resource at their disposal to address some of the fundamental complaints against marketing.

Leveraging the new media: Even as the Internet and other new media channels continue to challenge many of the fundamental ways of doing business, it also offers some tremendous advantages hitherto not within the reach of companies. As a majority of the companies compete to create a presence online, they also should establish structures in their websites that would help measure many a marketing variable. Softwares allow companies to track their customers’ footprints, the stickiness – the amount of time a customer stays on a site, the click through rate of online advertisements, effective optimization of layout design and feel to measure changes in attitudes and behaviors and so on.

These tools can be effectively leveraged by the CMOs to begin the process of quantifying marketing outcomes. These early experiments also allow companies to gradually design their own set of useful metrics. Such an essential first step not only brings credibility to marketing, but also allows marketers to make a strong impression with the top management teams and the CEO.

Internal training: In order for marketing to rise up to the boardroom level, marketers should be thoroughly able to understand the strategic imperatives of the company across functions and be able to speak the boardroom language. Such a state can be attained through formalized internal cross disciplinary training. Such a training system would allow marketers to understand the dynamics of corporate strategy and also enable marketers to effectively leverage the collective internal resources towards ensuring profitability and optimal results.

On the horizon

This blog post has raised some very fundamental questions about the way the companies should be run in the future. The role of marketing within a company is only going to become even more central as managing customer interactions and co-creating value become the building blocks of any corporate strategy.

In the future, the CMO will emerge as the strategic connection between the corporate boardroom, the top management team, the CEO and the customer. Companies should offer the CMO the requisite status and power within the company. Furthermore, companies must create an organizational structure where CMOs can guide the company’s vision and mission by integrating the myriad functions within the company. The time is not too far when the success of the company depends on the strength of its marketing and the CMO.