Sunday, December 9, 2007

Darwinian marketing - Part II

It turns out that that Facebook's new Beacon social advertising program wasn't as opt-in as originally portrayed. In fact it became an "I can't op-out" nightmare for Facebookers as they discovered that their purchases were being broadcast to their network without full permission.

My original post, based on the reports that this was opt-in, suggested this would be an example of Darwinian marketing. Great brands would be hailed peer-to-peer. Likewise, crappy brands would get equal airplay. Wrong! This wasn't opt-in at all. It was just mass marketing at its worst.

So in the end the principles of Darwin turned on Facebook itself which this week, after howls of protest from the community, apologized and announced major changes in the program.

Saturday, December 8, 2007

Umami branding

Some of the world’s greatest brands are those that appeal to both head and heart, brands with real substance that are also emotionally rewarding.

Japanese chefs have a word for this: “umami.” (Pronounced “oo-MA-mee.”)

Today’s Wall Street Journal featured an article about this culinary concept first discovered by a Japanese scientist 100 years ago. Beyond the four basic tastes – sweet, salty, sour and bitter – is umami, usually defined as a meaty, savory, satisfying taste.

Umami has taken the food world by storm. Famous chefs and food companies like Frito Lay and Campbell Soup are adding umami to its recipes. Foods that are rich in glutamates – mushrooms, wine, Parmesan cheese – help make the food more savory and delicious without adding fat and sodium. It is an intangible sense of “deliciousness.”

So what does this have to do with great brands? Everything.

Applying the concept of umami to marketing would lead to more brands that balance functional value with a strong, intangible emotional appeal. Umami brands make you feel good, smart, satisfied. They don’t manipulate the senses. They are authentic. They are good for you. An umami brand fosters feelings of well-being and fulfillment.

My umami brands? Apple. Toyota. Williams-Sonoma. American Express. Budweiser. Harley-Davidson. adidas. Starbucks. Levis 501s. And most any 2000 Pauillac.

Wednesday, December 5, 2007

Go green

As a passionate fan of the New York Giants it pains me to write a post in praise of the Philadelphia Eagles. But I recently heard of the environmental program the Eagles' organization implemented several years ago and was impressed that a football team would have the courage to lead on a critical social issue on which most publicly traded businesses remain silent.

Go Green was put in place by Christina and Jeff Lurie, the Eagles' owners. The organization has tested carbon-neutral games (using offsets), installed photovoltaic solar panels at several of its facilities, supports re-forestation programs and recycles much of the trash fans leave behind after a game. They've been able to document the positive impact the program has had on shrinking the carbon footprint of the organization and its fans.

This is a good example of how easy it can be to do good if you have the will to do so. Most companies don't do this because the "business case" can't justify the expense. The Luries are doing it simply because it's the right thing to do.

Speaking of photovoltaic solar (how many times in life do you get to say?!), this renewable energy source may finally be poised to deliver on its long held promise. Major hitters are putting their money into the sun. Google recently announced its intention to invest hundreds of millions to help develop new renewable energy sources, particularly solar. And Applied Materials, a client of BD'M, is bringing to bear on solar the same nanomanufacturing technology it used to drive down the cost of semiconductors. If they can be successful in driving down cost, which has been the key barrier for solar, it may make it easy for all of us, consumers and businesses alike, to significantly reduce our collective footprint.

Tuesday, November 27, 2007

A venti-size brand challenge

This is a love letter to a brand I crave every day but fear may be losing its way.

I read today that Starbucks in investing in a new TV campaign to help feed its voracious appetite for growth. As an advertising professional I supposed I should greet this as good news. But I don't. I believe in great brands. And, to be sure, TV has a role in the creation of many powerful brands. But this is not the solution Starbucks needs at this moment. In fact the idea of using mass marketing may exacerbate the very problems that have led to its decision to become a mass marketer.

The company's growth is insatiable. It's difficult to maintain a cult of the "third place" when the brand is every place. I recently heard a bit of biting satire (I believe attributed to The Onion) that captures the issue: "In order to maintain its rampant growth Starbucks will begin opening new locations in the men's rooms of existing Starbucks."

In an internal memo accidentally leaked to the media earlier this year, Starbucks CEO Howard Schultz exhorted his management to get back to the core brand promise - great coffee served in an intimate neighborhood coffee house setting. Schultz pointed out several decisions he believes have watered down the customer experience -- e.g., the new automatic espresso machines that, because of their height, removed the theater and romance of watching the barista prepare your latte, or the company's decision to use flavor-lock packaging that robbed the environment of any coffee aroma whatsoever. Small decisions on their own. Big decisions when viewed with the clarity of 20/20 hindsight.

Here's an example of from my neck of the woods of standardization run amok. As part of its recent acquisition of Diedrich's, an O.C. coffee house chain, Starbucks took over one of Diedrich's crown jewel locations, a beach front store in Laguna Beach, home to surfers and artists. This joint exuded a bohemian feel with beachy furniture and live music in the evenings. But rather than preserve this vibe in a Starbucks way, out went the local flavor and live music and in came the McFurniture and piped-in music (available for $12.99). Pity.

So what should Starbucks do instead of TV? I'd like to see the brand invest in creating more experiences. Give me more reasons to visit and spend time -- e.g., free WiFi. Since coffee is a social experience, advocate social issues in the same manner as American Express does so well throughout the year. Own the idea of great coffee by helping me appreciate the nuances of different beans and coffee regions. Be a loud advocate for Fair Trade coffee. And when it comes to music, be the launching pad for new indie music.

In sum, I want my Starbucks to behave more like an artisan and less like a marketer.

Tuesday, November 20, 2007

Thursday, November 15, 2007

Democracy rules

I heard about this website the other day and believe this might finally be a way to return an element of democracy to the democratic election process.

10questions.com is soliciting videotaped questions from voters around the country. We the people will vote on the top 10 questions we want our politicians to address. Candidates in the upcoming presidential race will be invited to give their response to each question.

I love this idea. It will enable us to sort out and prioritize the truly important issues (and not the fluff they debate in D.C.) and give us a way to compare and contrast candidates.

It makes me wonder if this could be applied to brand marketing. What if Ford invited the buying public to vote on the design they would like to see the company build? Auto design is so secretive for no apparent reason. If a competitor caught wind of the design Ford was going to build it would take them two years to ramp up and do a similar version. I'd love to see one of the car companies take design to the people and let democracy rule.

Tuesday, November 13, 2007

What's Danish for smart branding?

I've written about the power of brand design in an earlier post. The story of Jyske Bank in Denmark is another example of the role design can play in helping a company achieve its marketing objectives.

Jyske (pronounced "Yeeska") set out to increase the number of customers it serves. That's a brief we've all seen before. But instead of resorting to free toasters, viral films or more advertising, Jyske Bank opted to change the experience itself. They used design to redefine the very concept of banking. They made the brand tangible and physical in a manner that evoked an emotional connection. They created that special "third place" -- a haven that is neither home or work -- that has been the secret sauce behind Starbucks' success

The result? Jyske Bank doubled its customer base in one year by improving loyalty while attracting brand new customers.

Take a look at this video. You'll see a great case study and brush up on your Danish.

Wednesday, November 7, 2007

To pay or not to pay...?

The majority of Radiohead's loyal fans rewarded the brand's social pricing experiment by totally ripping off the band and paying nothing for the new album.

The band launched its new album, Rainbows, online and allowed fans to set the price.

A recent survey by comScore shows nearly two-thirds of "fans" opted to pay nothing. Zippo. Nada. And those generous souls who decided to pay coughed up an average of $6.00.

This should come as a surprise to no one. Free wins every time. What Radiohead should have done is set a fair price (say, $6) in exchange for stripping away all the overhead that fans shouldn't have to pay for in this digital age (e.g., distribution, marketing, and especially those anti-green and difficult to unwrap plastic CD cases, etc.)

Darwinian marketing

Facebook announced yesterday a new “social advertising” program that facilitates peer-to-peer brand recommendations.

Here’s what Facebook is proposing and why marketers should care: Users can choose to endorse a brand and then share that message with their entire social network; marketers can attach an ad message to the user's notification. It’s opt-in. It’s peer-to-peer. Sounds nice and tidy. What marketer wouldn’t like this? Well, for starters, those with crappy products and customer service.

Therein like the central point of wikibranding. While word of mouth is certainly not a new phenomenon, consumers’ instantaneous access to mass media with which to broadcast their opinions is an entirely new dynamic. Facebook's social advertising program will enable consumers to spread the good word about good products. It will also enable them to alert friends to avoid bad products or companies with frustratingly poor customer service.

In the end, this is a wake-up call to companies to design products that delight or get voted off the island.

Wikibranding is Darwinian marketing at its best.

Saturday, November 3, 2007

Don't mention the P-word

When was it decided that prunes were no longer called prunes? Did I miss the memo?

I saw a commercial yesterday for California Dried Plums. There was nothing particularly special about the spot. In fact it was exceptionally ordinary. But one line of copy caught my ear, “California dried plums, what we used to call prunes.”

A quick search reveals what we might suspect: this was the result of careful market research to find a name that didn’t conjure images of elderly people sipping murky brown prune juice to alleviate constipation. Thanks to this clever rebranding we can now imagine young people sipping murky brown dried plum juice to alleviate constipation.

I suspect this same marketing team may have been the masterminds behind changing the name of Sugar Pops to Corn Pops, which is clearly a healthier cereal. (But it doesn’t explain its latest line extension – Chocolate Peanut Butter Pops. Seriously.)

And while I’m thinking about it, whatever happened to Mr. Salty Pretzels?

Wednesday, October 31, 2007

The joy of selling less

Today’s Wall Street Journal reports on General Motors’ decision to limit production of its Buick Enclave. By intentionally restricting supply GM has kept the car “hot” months after its launch and avoided brand-diluting rebates and 0% financing deals. How many times have we seen car companies launch shiny new models for which they’ve invested five years and hundreds of millions to develop only to resort to bribing buyers within months after the launch.

United Airlines, a client of Barrie D’Rozario Murphy, has exercised similar restraint by cutting capacity in an attempt to align supply with demand and regain pricing power – a feat almost unheard of in the airline business. Consequently, United’s earnings are healthy and it can now invest in new services for its profitable business travelers, such as its new international premium service, which will further grow profits.

Automotive and airlines are two categories in which, for years, capacity has grown faster than demand as companies competed for top-line revenue and market share at any cost. The same is true in many manufacturing-based businesses - particularly consumer electronics. It's refreshing to see two companies remember the fundamental premise of brand marketing -- branded products create unique value for customers at a premium price. That’s why we brand.

Tuesday, October 30, 2007

Brand X for president

There is an increasingly blurry line separating politics and marketing. I’m sure one can make the case that this has always been true, but most political junkies will point to Lyndon Johnson’s groundbreaking “Daisy” campaign commercial as the tipping point that ushered in the modern era of political marketing.

Candidates today are neatly packaged like brands. They have catchy names (Barack!). Like brands they often need to be repositioned (Rudy, now kinder and gentler). Sometimes they launch line extensions to increase market share (Hillary, with 50% less Bill). And they employ many of the same media strategies embraced by successful brands – e.g., product placements on The Tonight Show, viral marketing on YouTube and social networking on Facebook.

With all these similarities, why don’t we trust politicians as much as we trust household brands? A recent survey from the Pew Research Center shows that Americans believe the federal government is ineffective and wasteful and that we are pessimistic about our elected politicians’ ability to do the right thing.

So what can we do? Well, if our politicians want to behave as brands and not leaders, then let’s treat them as brands.

We must demand the ability to evaluate a candidate’s content like we do a can of soup. Food products are required to carry clear nutrition labels, so should our candidates. Let’s insist that candidates stand next to a sign at all debates, photo-ops and stump speeches that clearly articulates their positions and that the sign, like food labels, be consistent and present at all times.

We must demand the ability to compare and contrast each candidate’s quality and reliability – a form of Consumer Reports for candidates. And I don’t mean some dusty and dense policy review from the League of Women Voters. We need something snappy like a J.D. Power rating or a CNET numeric score.

And while we’re shopping for a new president, how about insisting on a rock solid warranty with no fine print? We don’t buy our cars without a warranty. Why let our politicians off the hook? Let’s insist that a first-term president cannot seek re-election if, by his or her third year in office, they have not fulfilled at least 50% of their campaign promises.

I’m not going to give up on this democracy thing. Although it's a relatively new product on the world market, I think it will have a long shelf life.

Thursday, October 25, 2007

Wii need more fun

Sony’s recent earnings report showed continued weakness in its PS3 business relative to the booming fortunes of Nintendo and its hot selling Wii.

Industry analysts and gurus will likely focus on issues such as price and technology to explain the dynamics in the videogame category. But over a recent breakfast with a Sony exec I heard the clearest explanation yet: the Wii is simply more fun.

Fun. Now that’s something they don’t teach in MBA programs.

My friend made a powerful point, citing the Consumer Electronics Show in which Sony, Microsoft and Nintendo all made their competing announcements about their upcoming products. Sony and Microsoft spoke endlessly about power, speed, graphics, etc. Nintendo came forward and announced that the Wii was designed to be more fun. More social. More interactive. Just more fun.

That’s a great lesson for so many marketing categories. Appeal to the power of fundamental human emotions. Design products around these emotions from the ground up. Don’t rely on marketing to graft emotions onto the product. Toyota hit the mark with its “don’t you dare drive this to the dry cleaner” FJ Cruiser. And Carl’s Jr. has built its brand on unapologetically indulgent items like the Guacamole Bacon Six Dollar Burger or the new Strawberry Banana “Schmake” (aka, smoothie shake).

The brief for a designing a new product should begin with a single question: “How do we want people to feel?” With that answer we can design products and marketing that people actually want to experience and tell their friends about. But this may just be a pipe dream if we don't embrace research that gets at emotions rather than the rational feedback that focus groups and clinics tend to gather.

Monday, October 22, 2007

The day the music died...

Bob Dylan in a Cadillac commercial??

No way...could never happen. That would be as weird as Wilco selling Vdubs, right?

Saturday, October 20, 2007

TV detox (sort of...)

I’ve been conducting my own personal media experiment over the past several months. I’m going through TV detox. No traditional TV. No sitting on the couch and letting the warm glow of mass media wash over me. Instead I’ve been using more Web TV to get a first hand feel for whether this platform has potential.

True confession: I love TV. I love its connection to, and ability to shape, the pop culture zeitgeist. This is not the test of some new-media, TV-bashing fanatic.

The result? Like with all media platforms, online TV has its time and place. It cannot match the experience of watching TV on a Bravia in 5.1 surround. But I have been pleasantly surprised to discover how many of my favorite programs I can download or stream for free. I like the freedom of streaming 30 Rock while waiting out a delayed flight or getting my dose of Anderson Cooper 360 on my iPhone on the treadmill. I’ve also incorporated many more video podcasts into my viewing diet, such as Rocketboom.

So why should we care about this? From a marketing standpoint, online TV content has the potential to help marketers use the time-tested branding power of sight, sound and motion in a far more targeted and less-intrusive manner. Each network uses a different approach to sponsorship. I found the occasional commercial every 10 minutes or so from a single sponsor to not be overly bothersome in exchange for free content. And the ability to click over to learn more about the product finally delivers on the long-promised potential of interactive TV. (Perhaps, then, the best usage of this platform is for launching new products and not merely re-running existing commercials.)

Another reason we should care came to light this week in a new study published by the Conference Board. Its joint study with TNS reports that close to 16 percent of American households who use the Internet watch television programs online and that the number of consumers viewing full episodes online has doubled from a year ago. The study also reveals that watching TV programs has replaced news as the most widely viewed content online.

A second true confession: Those who know me well know that this test is suspended every Sunday while I watch the New York Giants. My commitment to the pursuit of knowledge has its limits you know…

Tuesday, October 16, 2007

The power of brand identity

I was driving this weekend near St Paul and noticed a highway sign with two gas station logos placed side-by-side. One was for BP, the other for Sinclair gas.

My first reaction was astonishment in realizing that Sinclair still exists -- in my head it's a brand that dates back to the Model T that perhaps had gone the way of its logo...which is a dinosaur. Apparently not.

Seeing both logos next to each other provided a great illustration of the power of brand identity systems. You cannot find two more opposite identities for the exact same product. BP is the color of sunshine and flowers, it's logo conjuring a green company. (After all, isn't the new BP "beyond petroleum"?) And Sinclair is a dinosaur, conjuring decaying fossils buried under dirt and rock transformed into the oil that drives our Hummers by millions of years of heat and pressure.

I've been a fan of the BP identity since its launch. They've executed a total brand makeover from the corner gas station on up. Though I would like to see more evidence of what it is doing to go "beyond petroleum." A flower logo can only fool us for so long.

I give kudos to Sinclair for its honesty and consistency. If you're happy being a petroleum brand, then a dinosaur logo is spot on target. (By the way, you won't believe this, but the dinosaur's name is "Dino." Go figure.)

Friday, October 12, 2007

File this under "C" (for creepy)

A recent article in Business Week features a way for marketers to live up to every suspicion consumers have about our profession. The emerging study of neuromarketing measures brain scans to see which promotional messages light up parts of the brain. Guess what? Some marketers are signing on.

Is this science accurate? (I'm being a tad generous calling this "science.") Perhaps. Should marketers be doing this? No! It's creepy and manipulative. Hey, while we're at it, why not hire roving bands of hypnotists to accost people in stores and get them to buy Corn Puffs?

At least now I finally understand how the Head On commercial was created.

Sounds like WikiBranding to me

Here's a excerpt from a study published this week at the annual conference of the Association of National Advertisers:

"Now, consumers not only talk back to marketers and interact with marketing messages, but they also reshape and distribute those messages through global communities," said Booz Allen principal Andrea Rasmussen. "The mix of media channels has shifted from a one-way broadcast model to a set of dynamic two-way media forums."

The study was co-sponsored by the ANA, the American Association of Advertising Agencies, the Interactive Advertising Bureau and consultancy Booz Allen Hamilton. Adweek has a good summary.

This is what WikiBranding is all about. It's the recognition that consumers are not only functioning as their own media programmers, but are now in charge of defining brand meaning and broadcasting to the world their version of the brand in ways never before available.

This requires marketers adopt a two-fold approach. First, invest in media and messages that help inspire true engagement with the brand. And, second, cede some control to customers and allow them to co-create and customize brand meaning in a manner that resonates with their interests and values.

Tuesday, October 9, 2007

The next big "_________"?

Is mobile marketing is the next big thing? Or is it the next big annoying intrusion?

That is the question.

The answer may come from Google. (Of course.)

There is an increasing amount of chatter about the so-called GPhone. It is reported to be in prototype stage and not likely to debut for at least another year.

Here's why this is interesting: It seems Google doesn't intend to innovate the handset like Apple did. Google has its sights set on reinventing the very business model that underpins the mobile phone market.

Recent news reports suggest Google intends to disrupt the category by introducing an advertising driven service - e.g., free calls in exchange for ads on your phone. Central to Google's strategy is its goal to create the software for a new open-source mobile operating system that will challenge Windows Mobile and, over time, wrest control from AT&T, T-Mobile, Verizon, et al over the software and services that can be installed on our cell phones. (Think about it...the current model is akin to HP or Dell restricting the applications you're allowed to install on your laptop.)

Can Google succeed against huge established players? (I don't know...let's Google "AOL" and see if that offers a clue.)

Will people tolerate ads to get better service for free? (I don't know... but perhaps some of the nearly 100 million folks on My Space and Facebook have an opinion on this.)

Here's what I do believe: Mobile is here. It's going to get smarter and bigger. Marketers cannot ignore it.

So what can marketers do in the meantime? At a minimum, design a mobile element into every every campaign -- e.g., a simple invitation in each ad -- "text 1234 to get the inside scoop." When you think about it, there's a strong likelihood that people have their phone by their side while reading a magazine, waiting at a bus shelter, having a beer in a bar, walking through an airport, listening to the radio and watching TV. Why not replace the obligatory website call to action with a mobile call to action? (Who by now does not know how to find a company online?) This simple adjustment has the power to turn off-line media into opt-in, interactive media.

Saturday, October 6, 2007

Did you know?

I saw this YouTube video yesterday in a meeting at UCI. "Did you know?" was designed as a wake up call to our education system. But it is also a sobering reality check for marketers. We are attempting to solve the unknown challenges of tomorrow with yesterday's tools and beliefs. True in education. True in business. Take a look.

Friday, October 5, 2007

Designing brands

Over the years I've become increasingly fascinated with the role of design as a business strategy -- not just a form of aesthetics. I think my epiphany happened when I was first exposed to companies like IDEO.

In my work with the Merage School of Business at UC Irvine I've been following the rise of so-called "D-Schools" that are competing with traditional MBA programs as a post-graduate destination for aspiring masters of industry. Witness the rise of these programs at MBA powerhouses such as Stanford and Northwestern. The revolution is on.

So why aren't all companies embracing design as a core business strategy? Because it is very difficult. It requires a CEO-down commitment to have design influence and guide every aspect of the brand...every single customer touch point. Yet Apple has found a way to do this. As have Nike and Target. This month's issue of Fast Company features a very good article on this topic. Yves Behar, the superstar designer, makes a fascinating point: "Design is how you treat your customers." I love that idea -- design is an experience.

Car companies are truly design companies at their core, yet they keep design in a distant silo within the company. Odd. I've worked with a range of automotive brands (Jaguar, Land Rover, Lincoln, Toyota). These companies live or die based on design. But they tend to limit their passion for design to the products. Apple, for example, is equally manic about its packaging and store environments. Apple recognizes that all these touchpoints help define the brand. Yet I have yet to find a car company that allows its designers to get involved in shaping the total brand experience. Imagine how much more powerful the marketing would be if the same designers who defined the car's essence, visual identity and personality were also involved in deciding key aspects of the customer's experience with the car -- its positioning, advertising, the website, the showroom display, the autoshow display, etc.

At BD'M we embrace design as a strategic medium through which brands can connect with customers. Design in marketing communications can form a visual vocabulary that speaks volumes to customers. This is not a new idea. Youth brands have known this for years. There is a big opportunity for clients to begin embracing design with the same appetite with which they embrace digital or viral marketing. Design is essential in today's consumer and media landscape.

Wednesday, October 3, 2007

Shamrocks and Urdu

I'm a Pakistani born son of Irish immigrants. I wonder what shoe Nike will design for me?

Why do I ponder this absurd idea? Because absurdity knows no bounds. Today's New York Times reports of the flak Nike is receiving over the shoe it designed for Native Americans. From a functional standpoint, Nike designed a special shoe tailored to the wider feet of many Native Americans. That's good. And we must give Nike props for investing the profits from this shoe back into its Let Me Play initiative on Native American lands. That's excellent. But perhaps Nike should have put its pencil down at that point. Because in addition to its Swoosh, Nike chose to adorn the Nike Air Native N7 with subtle cues of feathers and arrowheads. Bloggers are having a field day with this (my favorite coming from The Portland Mercury). So I will patiently await my Nikes decorated with shamrocks and "just do it" written in Urdu.

Tuesday, October 2, 2007

Free is good

Here's an experiment to watch. Radiohead has announced that it will launch its new album, "In Rainbows", exclusively online and will allow buyers to set the price for the download. Radiohead will offer two options: a fully loaded box set for 40-pounds or a pay-what-you-please download version for listeners who just want the music. A survey by music website Idolator.com suggest some folks will be willing to pay, but perhaps no more than 10% of the asking price. This is one of those moves that is either hugely bold or astonishingly silly. That's why it will be fascinating to watch. It'll give a clue to whether or not there is any pricing power left in the music business. It'll also give marketers in other categories a clue to whether consumers can be persuaded to pay for content that they can get for free through other channels.

In a related event, clearly influenced by Radiohead's new strategy, the Financial Times announced yesterday that it will stop charging readers for access to its website. Readers will now be able to get up to 30 stories per month at no charge. This follows a similar move by the New York Times and an anticipated announcement from the WSJ.com. (Clearly all three have just caught onto to digg.com)

What do both events have in common? People like free stuff. Duh.

Can a name-your-price Ford Focus be far behind?

Sunday, September 30, 2007

A slippery slope

So many companies have learned the hard way that once you start down the slippery slope of price cuts it is very hard to wean consumers off the drug. The auto manufacturers know this all too well. We all know that if we wait just a bit longer the car we want will come handsomely equipped with a $3,000 cash back or 0% APR.

This week Macy's admitted its attempt to wean customers off the drug had backfired. The New York Times reported that Macy's tried to pull back on coupons and discounts after the company consolidated over 11 department store chains around the country under the Macy's brand. Macy's CEO Terry Lundgren admitted that abruptly curtailing discounts like coupons was Macy's biggest misstep, contributing to four consecutive months of falling store sales this spring. Macy's now pledges to offer plenty of coupons in time for the upcoming holiday shopping season.

Which brings me to Apple. For years Apple was a master of competing on price without overtly discounting. Each fall, to stoke demand for MacBooks among college students, Apple offers a free iPod with every MacBook. Classic strategy -- add value, don't discount. After the iPod first appeared Apple adeptly covered a range of price points by continuously introducing new models at lower prices (Mini, Nano) while simultaneously offering more expensive models with more content (video). This strategy left little room for any competitor to steal share with a lower price.

Which is why I'm still stunned at Apple's decision to cut $200 off the price of the iPhone. Apple sent a message that its most loyal early adopters are being overcharged and that, in the future, we should simply wait a couple of months before buying Apple's next big thing. Apple, to its credit, was quick to respond with Steve's open letter and rebate offer. But the debate in the blogoshpere is still raging. (My iPhone was the butt of jokes at a recent dinner party. When was the last time anyone was ever ridiculed for buying an Apple product?) I, for one, hope Apple doesn't become just another consumer electronics company that launches, discounts and abandons. I love the brand and hope it has learned from this mistake.

Friday, September 28, 2007

Microtrends

Here's a better link to Microtrends, Mark Penn's new book I reference below.

The consumer is not a moron!

David Ogilvy, founder of Ogilvy & Mather, the agency where I started my career, was fond of exhorting his agency to respect the intelligence of the people to whom we were advertising our clients' brands. "The consumer is not a moron, she is your wife!" Nowadays David would probably replace "wife" with husband, partner, significant other, son or daughter. But his point was clear: never assume Madison Avenue has a monopoly on intelligence. (Far from it!)

I'm reminded of this same point today within our political climate. Too many politicians and policy makers and their advisors treat the voting public as idiots that can fooled by a photo-op. Mark Penn, pollster and zeitgeist guru to President Clinton, Hillary Clinton, Bill Gates, Tony Blair, among others, makes this point loud and clear in his new book, Microtrends. He uses survey data to show that the average working American is actually more in touch with important issues that matter than more affluent and well-educated Americans. Surveys show that the affluent tend to be swayed by a candidate's "vision" and "leadership" whereas the working Joe makes his decision on issues impacting job security, healthcare, their kids' education and crime.

Today's New York Times carried a story about John Edwards' appearance last night on MTV to engage in some Q&A with America's youth. Instead of fielding questions about his favorite band, briefs or boxers, or Yankees vs. Cubs, he was bombarded with serious inquiries about how he would fund his proposed universal healthcare plan, what he would do to curb inner-city crime and how he would keep college affordable.

So what does all of this have to do with WikiBranding? Everything. The consumer is smart. The consumer is in control. The consumer will punish marketers and brands that treat them as idiots (except in the case of beer advertising!). Conversely, consumers will reward those marketers that show respect for their customers' values and intelligence. (Did you hear that Steve Jobs?)

Thursday, September 27, 2007

WikiBranding in action

A great example of wikibranding in action. Rats in a fast food joint is nothing new. Rats in a fast food joint on the evening news is nothing new. Consumers taking this story and making their own content on YouTube to spread the word about rats roaming freely in a Taco Bell/KFC is wikibranding in action...much to the brand's detriment.

Alignment

I've long been fascinated by the power of brand alignment. I'm not talking about consistency across media or sales channels, but alignment with the company's fundamental value proposition, alignment with its business model, alignment with how the company invests and makes its money. That kind of brand alignment.

Target is a great example of alignment. Years ago, when squeezed between Wal-Mart (low price) and Macy's (variety and selection), Target decided to differentiate and win on the strategy of offering affordable design. We all love the advertising, but that's not the real story. Target aligned its business strategy, product selection, pricing, store design, and, yes, advertising around the idea of affordable design. "Tarzhay" leaped from being a discounter to a pop-culture icon. (What other store makes it into lyrics in a YouTube music video? Kohls? Not so much.)

Enterprise Rent-a-Car is another successful example of brand alignment. Its business model is based on delivering replacement cars to customers who are suddenly without a car (in for service) or without the right car for the weekend (need bigger car to haul visiting family). Enterprise doesn't target business travelers nor leisure travelers, two sizable segments. Its decision to focus entirely on the replacement car market drives and aligns its real estate strategy, pricing, and message ("we'll pick you up.") True, the advertising can be soooo much better, but at least Enterprise has resisted the temptation to be all things to all people and, instead, has a brand proposition that is aligned with a differentiated business model.

While President of Saatchi & Saatchi LA we explored a range of positioning strategies to launch Toyota's full-size Tundra pick-up truck. Then one day we realized a very simple truth: Toyota invested considerable engineering capital to give this 1/2 ton pick-up truck the strength, power and capability of a larger 3/4 ton pick-up truck. The result? A strategy and launch campaign based on the idea that the Tundra is the 1/2 ton pick-up with 3/4 ton guts. True. Differentiating. And fully aligned with how the company invested its capital.

During my time as head of marketing communications at Aetna Healthcare I helped lead a new positioning strategy to reframe the brand as a source of empowering health information -- not just health insurance. This idea was aligned with Aetna's Intelihealth venture with Johns Hopkins, its increasing emphasis on eHealth initiatives and the need to empower more of its members to practice preventive medicine. Again, like the examples above, a strategy fully aligned with the company's fundamental value chain.

Monday, September 24, 2007

Welcome to WikiBranding.

First off, a quick word about the title of this blog -- WikiBranding. It comes from a term I think I coined at a recent Ad:Tech panel discussion to describe the current state of play. While everyone is talking about how consumer now exercise full control over their media choices, what most marketers are missing is the fact that more and more consumers are exercising control over how brands are positioned and communicated. We're no stranger to the power of word of mouth marketing. But now consumers have access to mass media with which to spread their opinions of a brand's true meaning and worth.

This blog aims to be a brainblender for insights, ideas and observations from the world of marketing and branding. It will likely veer off into the realm of pop culture, design, communications and media and all things in between. Why? Because the best brand ideas find their inspiration from these worlds. The best marketing innovations come from the collision of diverse perspectives and experiences -- not just a bunch of marketers locked in a room with a whiteboard. I've been in the branding business for 25 years and have never been more energized. A quote from Tom Peters' "Re-imagine" sums up why: "If you don't like change you'll like irrelevance even less!" Indeed.

The pace of change can make your head spin. Microtrends. New media platforms every day. A flat global economy. Good times.