Category: brands

There is no place for the 4 Ps in a brand strategy

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The four Ps is a mass economy concept based on the ‘sell what we make’ company driven approach. It has no place in the customer economy of today where customers, not companies define brands. The 4 Ps emerged in the 1930s, a time when your doctor would enjoy a cigarette after examining you. A time when there really was lead in the pencil you stuck in your mouth all day at school. A time one, maybe 2 national TV stations. A time before leisure time, mass travel, cable or satellite TV, multiscreen cinemas, the Internet, Facebook and twitter. The 4 Ps were often used in conjunction with another popular formula, AIDA. AIDA was developed even earlier than the 4 Ps, in the 19th century, by door to door salesmen in the USA.

In the customer economy of today, firms have to sense, define, realise and sustain value for consumers based on those consumer requirements for value. They can only do that by identifying the right consumers, talking with and listening to those consumers and matching product attributes to those consumers requirements for value. And once the long and expensive process of gaining a customer is over, firms have to then continue the relationship to ensure they retain those customers. They have to accept that not everyone is a prospect and shareholders must pressurise them to deliver measureable results in marketing.

The good news is, those consumers no longer inhabit the mass economy world of TV, print media, billboards and so on. Today, those consumers inhabit communities of like minded individuals who can and do influence each others decision making process. And because of the effectiveness of new technology and the nature of those communities and where they are, it is possible to identify the right consumers, engage them, build relationships with them and measure marketing effectiveness.

A key element of successful brand building today is a massive move away from the aquisition focussed approach of the 4 Ps and positioning products (you can read my obituary to positioning here) and an increase in retention strategies that look to sell more and more often to existing customers, acquired at such great expense.

You have a 15% chance of selling to a new customer and a 50% chance of selling more to an existing customer. Bain and Co reckons a 5% increase in retention equates to a 25% increase in profitability. But are you still using the 4 Ps to acquire new customers? Are you still sighing with relief every time a new customer walks in and then letting them go without even finding out who they are? And even if you get their card, how much data do you collect and record and how much of your marketing budget is used to market to these existing customers? I doubt very much.

If you want to build a brand, forget about the 4 Ps and start looking at your existing customers.

Social Media is not a branding silver bullet

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A brand is built not on acquisition but on retention.

And retention requires a relationship. And a relationship is based primarily on ‘Trust and an ongoing, sustained engagement, on customer terms that provides economic, experiential and emotional value to the customer’.

That’s what branding is all about. It’s not a communications exercise. It won’t happen as a result of an advertising campaign. And it won’t be carried out on the pages of Facebook. That’s right, social media is not a silver bullet.

Social networks give us the tools to engage with consumers and build relationships with them. But like any tool we need to use it properly to get the most out of it. We still need marketing with links to articles, while papers, blogs and so on that appeal to target markets.

Unfortunately the majority of brands are continuing to use new tools such as social media, that allow them to lay the foundations for a relationship with consumers, in the same way as they use mass market tools that trumpet a one-size-fits-all approach to marketing.

I recently tweeted about a cool bit of kit from sonos, makers of wireless digital audio systems. I asked if there was a Sonos dealer in Malaysia. Sonos tweeted me and told me to contact someone in Singapore and obviously allerted them as I got a tweet from the Singapore guy with an email of the distributor in Malaysia. I emailed the distributor and didn’t get a reply. Sonos hasn’t contacted me to see if I purchased and nor has the Singapore distributor followed up.

There is no silver bullet with social media. It won’t solve all our branding problems but, used correctly, it will help us build relationships with customers. From there you might, just might build a brand

Louis Vuitton in a spot of bother over print ads

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The Advertising Standards Authority (ASA) in the UK has received complaints that print ads for Louis Vuitton created by Ogilvy and Mather suggest that the products were made by hand.

Certainly looking at this ad that shows a woman creating the lines for the folds of a wallet

and also this ad that appears to be a woman stitching a handbag

It is easy to see why there have been complaints. Especially as the copy states, “infinite patience protects each overstitch… One could say that a Louis Vuitton bag is a collection of fine details.”

However, according to marketingweek Louis Vuitton defended the campaign by saying that “their employees were not assembling pre-packed pieces but were taking individual handcrafted and hand-sewn parts through a range of hand-made stages to reach a final item.”

Louis Vuitton added that the use of hand sewing machines and associated tasks were “part and parcel of what would amount to ’handmade’ in the 21st century”.

So handmade doesn’t actually mean handmade in the traditional sense?

If that is the case does that mean then that the iconic hand made Hermes Birkin bag that can cost anything from US$10,000 to well over US$100,000 isn’t actually hand made?

Does this mean that the animal skins used in a Birkin bag are not actually spread out on the floor of the processing room and screened by a number of artisans before being measured and cut by hand as required?

Does this mean that the bottom of the handbag is not sown by hand to the front and back with waxed linen threads?

Does this mean that the handle of the Birkin bag is not manually stitched until the shape comes to the fore?

Does this mean then that the artisans don’t use sand paper to smooth rough edges? And does it mean therefore that hot wax is not applied to the handles to protect them from moisture?

And all the effort that goes into the front flap, the metal and lock is not actually done by hand?

Does it mean that the craftsmen in France that all work out of the little lane in Paris don’t actually exist?

And advertising agencies wonder why 76% of consumers don’t believe that companies tell the truth in advertisements. In Malaysia that figure is 86%!

The number one element in any relationship is trust. If a brand wants to build a relationship with a consumer, that consumer must be able to trust the brand.

An element of doubt in communications is not a good way to build trust.

Australia Unlimited. Genius or Garbage?

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Someone sent me this link about the plans for the Australian government to use a new tagline to sell Australia Inc to the world.

I’m sure you guys have lots to say and I welcome your thoughts on the article. To get the ball rolling here are a couple of thought starters.

1) Australia Unlimited isn’t a brand, it is a tagline created by an advertising agency to be used in creative driven communications using one message to communicate with all stakeholders, irrespective of their requirements for value. The concept of selling ‘Australia to the world” is laughable as most of the world doesn’t care.

2) Here’s a clip from the article, “Shortlisted agencies were given a brief to ”come up with a brand that would promote Australia’s capabilities across a range of sectors from investments and exports to education, culture, sports and events”

How does “Australia Unlimited” do that? And how could any communications campaign appeal to such a diverse prospect base?

3) Here’s another quote from the article, “John Moore, director of brand development of the Global Brands Group, the agency that has been co-ordinating the new Sydney brand, likes the line. ”It takes it beyond tourism and poses the question of what is unlimited about Australia, to which there can be many answers. I think it will work really well as a connecting device with all those different areas [of trade and business].”

Excuse me? How does it do that? I want to set up a mining company in Australia, what can you do for me? That’s the only question I want to pose.

This is another iniative, involving 2 stakeholders, Tourism Australia and Austrade, who should be working together but in fact appear almost to be competing with each other!

Nation Branding and Social Media

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A key element of a successful nation branding initiative depends on how well your audience absorbs, understands, adopts and redistributes the message based on their requirements for value. Back in the day this was done at a coffee shop, sundry store, mosque, church, football club or where ever else consumers congregated. Today those same people are increasingly likely to hang out in communities online. Facebook is the most popular home for many communities and it and other forms of Social Media need to be part of any strategic nation branding initiative.

But the Social Media rules are very different to the traditional media rules. And although many nations, organisations and government institutions or destinations believe they understand the new rules, the output of many of them would suggest otherwise. And this is detrimental to the long term success of the nation brand. Social Media channels or tools may not survive as long as many traditional media channels, but Social Media is here to stay.

One country that seems to be doing Social Media right, is the US. The importance of Social Media, and in particular Facebook during Obama’s presidential election campaign is now the stuff of legend. Key to the successes of the campaigns was that campaign personnel asked people what was important to them and then fed that information back to the main office where local service projects were implemented as quickly as possible. Many of of those vote winning projects continue today.

At one stage, in November 2008, Obama had 2,155,244 friends on Facebook, McCain had 578,651 and George W. Bush had none! Little wonder then who won.

The US has since expanded its use of Social Media to the international arena and the increasing importance of Social Media channels is reflected in the Facebook efforts of the US embassy in Jakarta, Indonesia. The Embassy has invested significant resources into Social Media just as the use of Social Media in the country takes off – the number of active Facebook users in the world’s most populous Muslim country has grown from 2,325,840 in March 2009 to 20,775,320 in March 2010, an increase of 793%!

As the US Embassy in Jakarta has ramped up its presence on Facebook, its fan base has ballooned from 35,000 followers to 131,000 in little more than a month! This in a country not known for its love of the US. But the US embassy understands that this is not a soap box to try and hard sell or influence Indonesians with US policies and attitudes.

As a result, the tone of the Facebook site is light and cheerful. One recent post on the homepage related to Indonesia Batik, has received over 795 comments and more than 2,300 thumbs up. Most of the posts receive 100+ comments and significant numbers of thumbs up. Batik is err a common thread throughout the site and most of the postings are related to American life and culture, and in particular sport, music and popular green initiatives. Other initiatives include Blogger workshops.

Tourism, primarily destinations in the United States are also featured, including a rather ambitious and possibly poorly targetted attempt by Nebraska to attract Indonesians to the Great Plains state. Despite the remoteness of the destination, the video has received over 50 mainly positive comments. Other states using the site to market themselves include Tennessee and Ohio.

The US Embassy markets the site via advertising on local sites such as this one

Social Media and, in this particular case, Facebook is undoubtedly an excellent channel for nations to build their brands by engaging with consumers and offering value to those consumers based on the needs of those consumers, whilst understanding the environment. The USA, certainly in Indonesia seems to know this better than most.

Thanks to unspun for the inspiration for this story

Branding states requires integrated strategic initiatives

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I believe that traditional brand communications driven by traditional processes such as creativity, placement, repetition, positioning are being dragged, kicking and screaming, to the branding graveyard. Brand communications, as a numbers game of releases distributed, ads run, awards won and so on, that focussed on outputs, not outcomes, are finished.

But this doesn’t mean that there isn’t a place for superbly executed advertising, as part of a integrated, organisational driven, consumer influenced brand strategy.

When the Sussex Safer Roads Partnership launched a strategic initiative that has at its centre, a campaign developed to remind individuals that wearing seat belts is important, the county realised that repeating well executed advertising on TV was going to be expensive and unlikely to reduce the number of road accidents in the county. However, the ads are good and were viewed over a million times in two weeks. My personal favourite is here

But the ads are only part of the story. The initiative also includes Operation Crackdown, a residents driven initiative developed with the residents of the area in mind. Essentially, the initiative calls on Sussex residents to contribute to the safety of their communities by reporting instances of anti-social/dangerous driving.

These initiatives are part of an integrated strategy that also includes educating businesses by offering companies a complete managers’ safety pack of handbook, driver information and posters to display in public areas. There are also opportunities for businesses to apply for specialist help to devise their own occupational road risk strategy, or to have existing safety initiatives examined by the Sussex Safer Roads Partnership.

There are also other campaigns that focus on children. Schools across the county participate in a quiz. Cyclists, horse riders and pedestrians are also targetted via multiple channels.

Operation Crackdown received 1,608 speed complaints from across Sussex, between March 2009 and March 2010. Extensive data will be collected and analysed on an ongoing basis and used to improve the strategy.

Self service can help brand profitability

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The other day, one of our computers froze. This is a scary moment for most companies and it was even more scary for us as we use Apple computers and it was the first time this happened in 7 years. More worrying, this particular PC is running some expensive design software and auto-save was off!

We had two options call tech support and wait 24 – 36 hours for them to come in or check out the Apple support site and see of we could solve the problem ourselves. We chose the latter and 20 minutes later the PC was up and running.

Enabling prospects and customers to answer their own questions is nothing new, but few Asian brands use it effectively. Yet it can have a significant impact on profitability. Forrester found that the cost of a customer sales or support call cost as much as US$33. The same report found that even email support can cost as much as US$10 per response. Yet Web-based self help averages US$1.17 per incident. And this doesn’t take into account the impact on reputation due to lost productivity by the customer.

Customers benefit too. In our case, we work to tight deadlines, sometimes spending the whole weekend in the office. If this had happened on a Saturday night, with a Monday delivery deadline, we may have lost the account.

One word of caution though. Self-service is not an excuse for avoiding service.

3 words that can ruin your brand in Malaysia and Singapore

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If you are in Malaysia or Singapore and you sell stuff to customers, there is one phrase that can ruin your brand.

“No stock Lah.” Is repeated time again by poorly trained and disinterested staff.

This seemingly innocuous phrase should be banned in your organization. While we’re at it, you should also ban the obligatory disinterested shrug of the shoulders that normally comes with the phrase.

For the uninitiated, the phrase is common in retail outlets the length and breadth of Malaysia and still, despite the alleged sophistication of the city state, in many of the malls up and down Orchard Road in Singapore.

This simple yet powerful phrase, used with annoying regularity in both discount stores and swank boutiques of luxury brands negates every penny your organization has spent on sales training, reputation development, customer service, customer relationship management and other operational excellence initiatives.

It renders worthless the massive investments you have made in licenses, real estate, interior design, stock, utilities and more.

It erases the hard work you have put into press releases, press conferences and other promotional efforts.

It undoes all the good of the advertising campaigns you have run for years in an attempt to get a consumer or two to give your brand a chance.

In a heartbeat, it ruins every single, expensive effort, financial and otherwise you have put into getting the consumer into your store.

In short, this seemingly innocuous phrase can ruin your brand.

Destination Branding: Branding Regions, States & Cities

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It’s estimated that there are more than 100,000 locations in Asia actively seeking to attract business, industry and tourists. As a result, it is increasingly important that locations seeking development, investment and visitors must have a structured, long-term approach for attracting visibility, investment and arrivals.

This conference brings together experts in the field of destination branding. Professionals who have been involved in the process of developing brands for regions, states and cities in Europe, USA and Asia.

The invaluable experience these respected practitioners bring to Asia will provide government servants and others responsible for driving investment into their regions, states and cities with the core elements and specific knowledge and tools required to build strong brands by matching attributes of their states and cities to the requirements for value of investors, businesses and businessmen as well as visitors, both domestic and international.

This ground breaking conference will also include examples of how other destinations have successfully branded themselves and attracted Foreign Direct Investment and visitors.

Venue: TBD Kuala Lumpur, MALAYSIA
Dates: Sunday March 27th 2011, 1900 – 2100. Cocktail Party & registration
Monday March 28th 2011, 0830 – 1700.
Tuesday March 28th 2011, 08:30 – 1700.

Confirmed speakers:
Keith Dinnie – author ‘Nation Branding – Concepts, Issues, Practice’
Bill Baker – author ‘Destination Branding for Small Cities’
Robert Govers – author ‘Place Branding’
Hamitabh Kant – author ‘Branding India – An Incredible Journey’
Dr Jim Hamill – leading expert ‘Destination Marketing in a Web 2.0 environment’
Courtney Fingar – editor FDI magazine

Should destinations brace themselves for a brutal summer?

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Grant Thornton has published a report that forecasts 373,000 visitors to the Football World Cup in South Africa in June. That’s a drop of 110,000 from original forecasts.

The big question is, are fans waiting to the last minute to book tickets or is this a sign of the recession? Certainly political tensions in the country may be causing fans to wait and see before making a decision on a significant financial commitment. After all it’s not just the match tickets. Fans also have to take into account the cost of flights, accommodation and internal travel which can be significant distances. Grant Thornton predicts fans will have to fork out US$4,000 each. For a family of four, that’s US$16,000 for a summer holiday in a recession! Hard to justify.

But I believe that the poor ticket sales are a result of the global economic situation. And if I am right, destinations in South East Asia could be heading for a brutal summer.

I think that free spending Europeans will forego an international holiday and instead invest in a large LCD or Plasma TV and stay at home to watch the World Cup. If they do go away, it will be either for a short domestic holiday or somewhere in Europe. I expect Eastern Europe to benefit.

If I am right, what should destinations do to soften the blow?

Well the first thing is to curtail one-size-fits-all mass market TV advertising communicating the usual white sandy beaches, tropical blue skies and azure seas. There is simply no differentiation from other destinations. Consider this comment from Qualitative research carried out by FusionBrand in the United States earlier this month,

“Watching the basketball today and an ad came on for a destination with some really nice water/resort images. It was Malaysia. But is (sic) struck me that the line Truely Asia gave me the feeling that they were trying very hard to say, “us too”. It gave me the feeling of them saying “we’re just like the other (good things) in Asia”. But the images in the ad could have been in the Carribean.”

How confusing is that?

There is no time to build a communications strategy for 2010. If it hasn’t already been done, and at least 2 countries in South East Asia don’t have a plan for 2010, it is too late. But there is still time to develop an integrated tactical approach to activity based not geographic based marketing.

Thirdly, embrace social media, NOW. Start to engage prospects and those who have visited via social media. Redistribute resources, train staff and create teams to build relationships with consumers via Facebook, Twitter, Travelocity, Tripadvisor and others. Forget about the old global buys on CNN and the BBC. Creating awareness via mass marketing wastes valuable resources and anyway, consumers aren’t listening. Reinvest that money in engaging consumers.

Fourth, don’t ignore the traditional web. Make sure your website is as contempory as possible. If you are sitting back thinking, why do we need to change or improve our website again, we updated it two years ago, the Internet is fluid. Destinations need to be seen as dynamic. Singapore is on its third design (and best so far) in two years.

Develop a plan for your digital tactics and don’t forget basic web marketing tools like SEO and SEM.

Call emergency meetings with all stakeholders – representatives of the mayor’s office from all key cities, transportation companies, travel agents, tour operators, shopping malls, hotels and so on. Identify what each has to offer and work with them to develop an integrated holistic plan to leverage their attributes and match those attributes to the requirements of target markets.

2010 is going to be a bumpy ride for cities, states and other destinations. This is an emergency and it calls for emergency measures.

Otherwise the 30% drop in arrivals in South Africa will be duplicated around South East Asia. And without the attraction of a World Cup, they could be magnified, causing many destinations to have a brutal summer.

Your communications are critical.