Branding :: Old v New
February 19, 2008
Here is a great article from Harvard Business on “The Shrinking Advantage of Brands”. The article points out what we have been saying for a while:
- The power/advantage now belongs to the consumer. (Although I’m not a fan of his term “cheap interaction”).
- The largest brand in the world got there with zero dollars spent on advertising.
The article also talks about how that impact of traditional branding is lessening. This is based on the definition of brand as ” … a promise: information from a firm promising you a set of costs and benefits from the consumption of a good or service. Brands shape your expected value.” Based on this definition, I would agree that traditional branding is less important and effective.
However, I think the definition of “brand” is actually changing to something new. I would offer this definition: Brand is how you are perceived in the marketplace. In other words, it is your presence in the marketplace. This presence can be initiated by advertising, but because of rising media costs and media fragmentation maintaining a presence is virtually impossible to maintain. Instead, companies must focus on creating great customer experiences, phenomenal products, and 1:1 relationships with the audience on a mass scale - all which is not related to traditional branding or marketing.
If we are right, then branding is the most critical thing to work on, short of having a great product. Because in this era, being known is not enough, you have to be loved.
Chief Revenue Cop?
February 18, 2008
I came across this article on how the American Marketing Association has update the “official” definition of “marketing”. The article is a good read and shows how marketing professionals are struggling to adjust to the massive changes occurring. In particular, I enjoyed their take on the role of a CMO (emphasis is mine):
The prime objective of the chief marketing officer (CMO), is to maximise sustainable profitable revenue, while minimizing the use of marketing costs and investment.
I like this definition. I have long felt that if you have a CFO managing the bottom-line/business formula (profit cop) side of the business, it makes sense to have an executive managing the revenue side of things. By focusing on ROI, it focuses marketing executives to plan and act more efficiently - which sometimes means actually spending less money on marketing.
The Brand Wishing-Well
February 17, 2008
This entry was inspired by an excellent article from Ron Shevlin.
Most efforts to “brand” are really just external ad campaigns. At best, brand “awareness” is created. If the result is just awareness, CMOs better hope and pray it leads to sales. Unfortunately for them, the days of products that are advertised the most also being the ones purchased the most are over.
True branding starts internally, with a desire for greatness (as defined by Jim Collins) and a desire for a multi-generational brand and sustained shareholder value. If the goal is just to make money and get out, then the issue of branding is pretty simple. You only need enough people right now to sustain your business model. And that is actually pretty easy. What is hard is to create a brand that becomes great, then maintains that greatness through economic, generational, and technology trends.
Speaking “CFO”
February 17, 2008
Here is a great article on how CMOs need to interact better with CFOs if they want more influence over business strategy and budget. In particular, this paragraph caught my attention:
A recent study by Marketing Management Analytics (MMA), found that just 7 percent of finance executives are satisfied with their company’s ability to measure marketing ROI. In the same study, only 23 percent of marketing executives had confidence in their ability to measure returns, still not exactly a ringing endorsement.
Marketing doesn’t have to be a guessing game, but it becomes one for two reasons:
- Marketing executives get list-centric. Because they struggle to show results, they quickly gravitate to showing off their punch list of marketing tasks. If you want to be treated like an executive, you have to stop acting like an employee.
- Marketing executives are using dated data-points like CPM. Cost per Thousand is largely irrelevant with the advent of TiVos and web-based content. Marketing executives would serve themselves well to implement closed-loop tactics such as web traffic and conversion percentages. In addition, best key performance indicator for marketing ROI is cost per customer. At a minimum, you can at least show the finance executives that your marketing efforts are leading to increased sales while lowering over-all marketing costs. That should keep them happy.
Brand Interaction
February 15, 2008
The third step is to match your brand promises with your customers’ experiences. To enhance the energy that is created by positive experiences. This is your web-site, your support infrastructure, and the usability of your product. It’s about creating a people-driven brand where you implement the tools to interact and listen to your audience.
Identity Examples
February 15, 2008
The second step is to visually connect your brand with your audience; to make it match the core idea of your business. This is not just a logo, but a story told through sensory perceptions - colors, images, and authenticity. Great identities incite curiosity, inspire behavior, and accurately lead the visual direction of your brand.
Check out this PDF to view some of the recent brand identities Tricycle has produced.
Brand Core
February 15, 2008
The first step is to distill your brand down to an idea; to a simple, beautiful concept - something that becomes a core doctrine that ignites a fire in the hearts of your customers and employees. This step is also the most difficult because it requires introspection and honesty. It starts with listening - to your instincts, your team, and your audience.
CMO Definition Wiki
February 11, 2008
I have a Google alert set up for “CMO”. It is interesting to capture the various articles, news alerts, etc. about CMOs. By the way, these stories are best defined as “Somebody was hired to replace somebody that was fired”. The purpose of this blog entry is to provide an on-going update of how various companies and media sources define the roles and responsibilities of a CMO
“… provide company-wide brand strategy leadership”. Discovery Channel’s new CMO.
“… covers consumer-targeted initiatives as well as trade brand-building.” Ion’s new CMO.
“… a significant influence on our brand strategy.” Popeye’s new CMO.
Updated 02/18/08
“Kershisnik oversees research and development, strategic insights, operations innovation, brand marketing, field marketing, media, diversity marketing and creative/advertising production.” Wendy’s new CMO.
” … in charge of revenue growth, sales and marketing, franchising and the company’s distribution channels for the company.” Thrifty’s new CMO. [Yikes - should they also include janitor and company pilot)
Risky Business
February 2, 2008
Here is an excellent article from CNN on the travails of being a modern CMO. I have extracted a few key points for emphasis - the bold areas are my “amens” …
A recent day in the life of Gitow as CMO included a meeting about promotions on the Web site, a discussion with store managers about membership programs, and reviewing analytics about its customers. CMOs must think “in a multidimensional way. Our job is to be one step ahead of these channels and understand where the customer is moving,” Gitow said.
“The Street, CEOs, boards need short-term wins and unfortunately that flies in the face of long-term consumer-oriented brand building. CMOs are looking for short-term wins, product launches, quick hits, but the reality is very few of them are getting huge wins,” Welch said.
The role of the successful CMO is no longer “about creating a clever TV commercial or coercing someone to buy your product. What works is creating a powerful product that people want to buy and people talk about like the iPhone,” Scott said. Companies such as Google create experiences for consumers with minimal advertising.
The mostly 40-year-old CMOs need to understand what drives Gen X and Y consumers. Welch says his teenage daughter talks about her 600 closest friends on Facebook, noting that she hasn’t met most of them. “CMOs must be unafraid to connect with this generation and get into their skin to understand new consumers,” he said.
Don’t blame the CMO for the high turnover rate, Neale-May says. “It’s more about the organization they’re managing and the corporation they’re involved in. CMOs must be change agents,” he said. Until CEOs do a better job of defining what the CMO does and aligning support, turnover will continue.
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