Tag: brands

Repetition no longer solution to brand building

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One of the problems with a mass marketing approach to communications is that they assume that prospects can be made to believe, through advertising repetition of the same message, what offerings can mean to them. It’s a variation of positioning and in the mass economy, when firms could control how offerings were portrayed, it may have worked.

But consumers have been misled, lied to, abused, manipulated, let down and so on. As a result, they no longer believe what most companies say, no matter how many times they say it.

Today, other customers define brands and their opinions and experiences will determine if consumers try a brand. Once they do, it is up to the company to know and understand those consumers and communicate with them with content that resonates with them to keep them.

Failure to do so will determine the success of the brand and not repeating the same message to anyone and everyone.

Why you should start building your Brand today

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This article first appeared in the Friday 29th April 2011 edition of The Malaysian Reserve/International Herald Tribune

Does this statement sound familiar? “I know I need to start thinking about building my brand but I don’t know where to start so it can wait.”

I’ve heard this statement a lot recently and if it is a general feeling throughout the business community, then we’ve got a problem.

We’ve got a problem because as Malaysia becomes an increasingly wealthy country it will increasingly become a target for global brands that have seen their penetration in more traditional markets reach saturation point.

Moreover, free trade agreements and stagnant manufacturing or services based economies are also encouraging global brands to take notice of countries like Malaysia.

In the last twelve months, major global brands from the agriculture, automotive, aviation, biotechnology, education, fashion, food, hospitality, logistics, property, transportation and other sectors that in the past have barely considered Malaysia, are now establishing offices here.

Even Unilever owned brand Marmite, a quintessentially British savoury spread most often used on toast, now has sales in excess of RM20 million in Malaysia, mainly because it makes a bowl of congee a little more interesting!

And as these global brands take note of Malaysia they will invest substantial funds to establish their brands here and once those brands are established, it will be difficult for Malaysian products and services to compete with them. Unable to compete, over time, these Malaysian brands will fail.

So Malaysian firms really must begin the process of building brands now, rather than later. The good news is that beginning the process of building a brand or revamping an existing company has many benefits. Some of the most significant include the ability to charge more for products and services as well as a reduction in costs. Furthermore, changes in technology and communications mean that Malaysian firms might not have to invest significant funds into mass communications.

A word of warning though. Any branding initiative should begin with a careful analysis of the organization, its processes and systems, especially those that are customer facing and whether or not it has a customer centric culture, what it stands for and whether these elements are relevant today. Be ready for bad news but see it as feedback and an opportunity to improve not as criticism.

And once the brand is ready, communications should focus not on broadcasting how wonderful the brand is across traditional mass media channels, but on engaging prospects with content that resonates with them and delivering economic, emotional and experiential value to consumers and across all touch points.

Here are six more reasons why you shouldn’t wait to start to build a brand.

Reason No 1: Branding unifies your organization & motivates staff
Your people will want to be part of a respected and recognized brand because personnel who can identify with and support a brand’s culture, values and behaviour are better motivated, more loyal and engaged, both internally and externally.

As a result, your people will have pride and an interest in the company they work for and what they do for that company. Morale will improve, productivity will rise and resignations will be reduced. Moreover, a culture that strives to deliver value to customers and on customer terms will prevail. This in turn will lead to increased sales.

Reason No 2: Branding integrates & enhances brand touch points
This is really important. Organisations with weak or non-existent brands more often than not, make promises they cannot keep, focus on acquiring customers but pay little attention to existing customers and underestimate the importance of the customer experience. By developing a brand and building processes and systems into the brand delivery system, every single touch point between your organization and the consumer will be geared towards delivering a positive experience. Positive brand experiences will go a long way towards building customer loyalty, key to profitability.

Reason No 3: Branding reduces costs
What better incentive can there be for building a brand? Branding requires a brand strategy and a strategy will anticipate multiple scenarios and prepare the organization for outcomes, reducing the likelihood of expensive cost over runs or unexpected expenses.

Furthermore, a well recognized and well respected brand attracts talent, reducing the need for time consuming recruitment campaigns and expensive head hunters. A brand also reduces marketing costs. Less established products or services can spend up to 10% of revenue on marketing, brands often spend as little as 0.8% up to 2% on marketing.

Reason No 4: Branding justifies a price premium
Yet another major incentive for anyone still not convinced they should be building a brand. Branding allows you to charge more for your product or service because people will pay more for a name they can trust and have confidence in.

Reason No 5: Branding shortens the sales cycle
A strong, well respected and recognized brand creates trust and an emotional attachment to the product which also helps to make purchasing decisions easier. Over time, this influences the speed at which a prospect or customer makes that purchasing decision. This in turn allows a company to build customer loyalty and create brand ambassadors to sell the brand on their behalf, shortening the process further.

Reason No 6: Branding blocks competition
By focusing on building a brand rather than carrying out a series of transactions, you will ‘ring fence’ your brand and stop the competition from poaching your customers. As interactions with your brand increase, customers will automatically think of you when thinking of your category, thereby ignoring competitors.

In an increasingly competitive and noisy environment where better established global brands with deeper pockets are starting to flex their muscle, it is imperative that Malaysian firms, large and small start to build their brands now, before global brands get a foot hold in the country and it is too late.

Effective email campaigns must be part of your brand strategy

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You’ve probably never heard of unsolicited bulk Email (UBE) or for that matter, unsolicited commercial email (UCE) but you have of course heard of junk mail or spam, the more common moniker.

The earliest known spam was a message sent in 1978 and the earliest known commercial spam message was sent in March 1994. This latter event coincided with the opening up of the Internet and the amount of spam has grown exponentially since then and the forecast is that seven trillion spam messages will be sent in 2011, making up about 85% of all emails sent worldwide.

This constant carpet bombing of consumer inboxes with irrelevant messages has had a detrimental effect on email marketing and now, with the advent of social media, our belief and trust in email is wavering. Nevertheless, email is still an effective tool in the communications of any brand strategy. It can be used as a marketing, sales, retention and CRM tool and response rates to personalized emails have been reported to be as high as 62% although 2-4% is the average. Still impressive.

But it is critical for marketers to ensure that their emails are relevant to the target market, well written and succinct enough to gain the attention of the reader in the roughly three seconds they have before the reader hits the delete/spam button.

It is also critically important to ensure before the campaign begins, that you know what the purpose of the campaign is and, most important of all, that your database is clean and up to date.

I am constantly stunned at the amount of shockingly written, poorly thought out and irrelevant emails that land in my inbox. I’m equally stunned at the amount of times I receive the same email from the same organization.

For instance this email, from an organization that recently spent RM15 million (US$5 million) on a ‘rebranding’ exercise, is exclusively for Mastercard owners yet I don’t have a mastercard!

Furthermore, the email is addressed to ‘undisclosed recipients’ and contains no cover message or other form of personalization. Finally, to the detriment of the brand, it has been sent to me an incredible six times in less than a month!

Takaful Malaysia which refurbished its 13 platinum branches and outdoor signs and billboards during the rebranding exercise should have also looked at its communications processes and systems, including qualification, lead and list management and other elements. As its stated aim is to ‘make the company more appealing to the younger age group, it should also review its creatives! But I digress!

What should Takaful Malaysia and other companies, who are thinking of carrying out email campaigns do to ensure those email campaigns create leads and prospects rather than brand antagonists?

Here are 10 recommendations that will help them and others get the most out of email:

1. Target your message
It’s critical that the subject line grabs the attention of the reader and encourages them to open the email. The best way to do this is to personalize the subject line. The Takaful Malaysia subject was the name of the product. Few people buy products. A better option would have been “Can I help you protect your family?”

2. Segment your target markets
Keep list sizes to a manageable amount. Don’t send gazillions of messages and then be unable to respond to them in an acceptable time frame (24 hours). Segmenting your targets will stop this happening.

3. Target messages
Keeping list sizes to a manageable level will allow you to develop multiple messages for multiple segments, critical to successful tracking. There is no one-size-fits-all solution.

4. Use a Salutation
The whole point of the exercise is to get a response, not to make a sale. If you met someone at a convention, you wouldn’t start pitching to them the moment you are introduced and it is the same with an email campaign. Be contemporary, slightly informal and inviting. Start prospecting emails with a greeting and, depending on the product or service, the contact’s first or last name, such as “Dear Mr Smith” or “Hi Fatima.”

If you don’t have the first and last name, don’t send the email until you have the correct information. The majority of emails without a name will go straight to the trash folder.

5. Keep Your Email Short
Lay the content out so that it is easy to read and keep the first email short to ensure it is skimmed. You want the prospect to read the entire email but they won’t stick around for long so make it a fast, easy read.

Keep the email to three paragraphs of no more than three or four sentences. You can also close with a one-line sentence.

6. Track each segment within each campaign
One of the great advantages of email campaigns over traditional advertising campaigns is the ability to calculate an exact CROI (campaign return on investment).

But don’t limit your calculations to response and conversion rates. Depending on the goals of the campaign, track demographics, territories, consumer data, page visits, click-throughs, time spent on pages, and other elements. Use this information to influence future email campaigns with more efficient and effective content.

7. Have a hook
Business owners and C level executives are busier than ever. They don’t have time to waste so have an instant hook. We are in difficult economic times and businesses are looking to save money, especially small businesses so an obvious hook would be related to saving money for a business. Ensure content resonates with target markets.

8. Content is still king
Mention specific issues relevant to target segments. There is so much information available that it is easy to identify issues affecting segments. It may take a little more preparation but it will be worth it in the long term.

9. Don’t go overboard on design
I’ve received emails with video clips, multiple graphics, embedded links, audio and so on. These are all distracting and time consuming when opened on a mobile device at an airport. Keep it simple.

10. Email marketing should form part of a brand strategy
Many firms conduct email campaigns on a whim, without any real thought or planning. This is a bit like driving a Ferrari in first gear, the car does everything you want it to but is it getting the best out of the car?

Incorporate your email campaigns into your brand strategy. Identify your quiet periods and implement an email campaign to boost sales in that period.

Email is still the most effective way to reach a lot of new prospects quickly and inexpensively. Email campaigns also have impressive response rates.

But email campaigns, carried out in an amateur way, can have a negative effect on your brand. However, if you follow these email best practices, prospects will take notice and respond, increasing your sales and building your brand.

Brand communications is no longer about broadcasting a company position across multiple mass communication platforms.

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In today’s always on world, an important part of any brand strategy is the communications strategy but if Asian brands are going to be taken seriously, Asian CEOs must understand that times have changed and that we are living in a new world order. And in that new world order, the success of a brand is in the hands of the consumer not the corporation.

Today CEOs must understand that how consumers source information about brands and where they source that information from, has changed dramatically over the last 5 – 10 years. Where previously they learnt about brands from television commercials, newspaper advertisements and the recommendations of friends, today they learn about brands from Facebook communities, Twitter lists and YouTube channels.

Gartner estimates that mass marketing campaigns now have only a 2% response rate and this is declining annually. Despite this, Asian CEOs, so long in control of their brands and reluctant to lose that control, continue to try and shape brand perceptions by broadcasting positions repeatedly across traditional media via multiple and repetitive campaigns.

But Asian CEOs need to accept that in today’s noisy, crowded, dynamic, mobile market place, a brand cannot be shaped by repetitive communications campaigns that try to appeal to as many people as possible in the hope that someone will buy and communicated across traditional media. And those CEOs must understand that the success of their brands is too important to be left in the hands of marketers and advertising agencies.

According to Gartner, by 2015, at least 80% of consumers’ discretionary spending will be influenced by marketing across social and mobile platforms. And it is imperative that CEOs do not allow marketing departments to continue the mass market model of invasive campaigns that try to push a one size fits all corporate position onto consumers.

So if building a successful brand requires more than a traditional approach to marketing where reaching anyone and everyone and making them all aware of the brand with a generic message broadcast multiple times across multiple channels is not the way forward, what should Asian CEOs do if they want to challenge the global western brands?

The first thing is that this new world order is good news for Asian CEOs because it means they can stop wasting funds on expensive creative driven initiatives that require deep wallets to fund advertising campaigns repeatedly across traditional media in the hope that they will resonate with consumers and lead to a possible sale because the reality is, very few of them are noticed, let alone remembered.

Try this experiment. If you advertise in a daily newspaper or on TV, ask yourself which ads you remember from yesterday’s newspaper or on TV last night. Be honest. I doubt it is many. Personally I remember the ads from the Sunday paper because I was stunned at how many pages featured supermarkets and hypermarkets having a ‘cheap off’ on chicken wings, grapes and cases of beer.

And these are the very same newspapers that featured advertisements for Patek Philipe and Rolex watches, Lexus and Audi cars and other luxury products and services the week before!

And even if you remember newspaper ads or TV commercials, how many of the products or services advertised, have you interacted with? And of those how many have led to a purchase? And even if they have led to a purchase, what did the company do to ensure you come back again? I suspect they didn’t do anything and instead, after they spent all that money getting you into their store or to buy their product, they let you leave without getting some personal information in order for them to start to lay the foundations for a relationship!

In this era of smart phones and the half a million applications that can be used on them; In this era of social media with five hundred million Facebook users (6 million in Malaysia) of whom 50% are active every day and one hundred and forty million daily tweets on Twitter, many of them generated by Malaysia’s 1.1 million members; the proliferation of leisure time activities and abundant choice at malls and more, Asian CEOs must understand that the answer to brand building is delivering economic, experiential and emotional value to consumers and on their terms and across all touch points.

The global economic situation is a golden opportunity for Asian brands to take market share from established Western firms struggling to overcome cash flow issues and poor brand penetration. But it is up to CEOs to understand that they have to review traditional practices and take an interest, indeed responsibility for the brand and ensure brand departments understand that it is no longer enough just to advertise in traditional media and hope a brand will succeed.

CEOs must ensure too that at the heart of any new strategy must be the organization, making sure every brand touch point focuses on delivering value and communications departments must take social media seriously and understand how to deliver more engaged communications. And this will have to be done in a much more integrated, dynamic and fluid manner.

And whereas in the past, a series of the same full page ads repeated in daily newspapers or a number of prime time TVCs was generally sufficient to build brand awareness which would lead to a sale. Indeed, many consumers would actually watch a commercial and take a note of the brand and where they could purchase it. Those consumers would then go to the store, look for the brand and buy it. If the brand was unavailable they would take time out to come back again and again until they could make a purchase.

Today those same consumers don’t bother taking note of the brand names because they’re carpet bombed with messages throughout the day, every day. Many of those messages are making outrageous claims or are totally irrelevant to them. They are also too busy multi-tasking during the expensive commercial breaks. Furthermore, they’ve been let down so many times after believing those claims that they now often ignore them completely. And because consumers have so much choice and so many information channels, they don’t need to pay attention to messages broadcast via mass media any more.

Now consumers use social media and other tools where they inhabit communities that they relate to and trust, to seek information about brands. So it is in these communities where brands must learn to communicate and engage with consumers and deliver value that resonates with those consumers enough to make them want to own the brand.

Don’t get me wrong, I’m not saying don’t advertise but I am saying that if your organization is not on brand and all marketing initiatives are not integrated to allow you to deliver on the brand promise. And if your organization is unable to deliver value across all touch points and if you don’t use every opportunity to engage with consumers and collect data to help you get to know your customer and start to build a relationship with your customer, your advertising efforts will be wasted and your brand will not survive these extraordinary times.

In this crazy, always on, competitive market place it is these relationships that are going to help build a successful brand and not newspaper ads or TV commercials, no matter how cool they are and no matter how cutting edge is the technology used in the commercial.

Is there a connection between desiring a brand and the profitability of that brand?

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According to this article Apple is the world’s most desired brand.

If you don’t have time to follow the link, here are the basics:

M&C Brand consultancy Clear quote: “took in the views” (what does that mean?) of 17,000 consumers across the UK, USA, Germany, China and Singapore and questioned them about hundreds (how long did that take?) of brands across multiple categories. Respondents were asked to reveal brands they want to hear more about, brands they want to use in future and brands they like to talk about, amongst other criteria. End quote.

Many of the usual suspects – BMW, Sony, Mercedes, Rolex, Nintendo, Microsoft, Amazon, Audi, Gucci, Cartier all got a mention. But what really surprised me was that Google (2nd) and WWF (5th) were also on the list. I’m curious, how can anyone desire Google? I mean in what way can they desire Google? How can Google be a desirable brand? Or for that matter WWF (is that wrestling or nature?).

The report also measured the performance of the top 100 brands against the Standard & Poor’s 500. I don’t know how the comparison was made, but apparently it “showed that desirable brands provide good return on investment and share growth”.

The report states that “The level of desirability is reflected in levels of profitability over the last five years. The top ten brands have grown more than the top 50, and the top 50 have grown more than the top 100 according to the S&P data.”

What is the link between brand desirability of a huge sample size across multiple countries, ROI and share growth? I mean I desire an Aston Martin but I’ll never own one!

17,000 is a huge sample size and I’m not trying to diss the report but it would be helpful if we had more information to determine if the report makes sense and how we can use it to help clients.

What will be the impact of social TV on your brand?

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A fascinating survey by Digital Clarity in the UK of 1,300 under 25 mobile Internet users reports that a large number of them are talking to friends about the show they are watching.

80% of the survey participants said that they used Facebook, Twitter or other mobile applications to actually comment on the programme and talk about the programme to friends as they watch it.

Twitter (72%) is the most popular platform, followed by Facebook (56%) and other mobile applications (34%). Of those surveyed, 62% use a combination of all three.

Social TV as it is being called is popular because it means young people can communicate with friends, in real time whilst watching their favourite programmes.

But this is really going to put the cat amongst the advertising pidgeons. Here are half a dozen questions that I’d really like to get you input on:

What are the implications for advertisers, already struggling to keep viewers focused on the TV during commercial breaks?

Will advertisers accept that reaching lots of consumers is no longer a relevant metric and demand more from media owners?

Will advertisers push the creative envelope more to try and position products?

Will product placement increase, perhaps with cross platform repetition?

How will they integrate technology with traditional marketing initiatives?

How will this integration of consumer habit impact overall branding strategies?

I look forward to hearing from you.

Dulux goes local

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I expect most people around the world recognise international paint brand Dulux.

In its early days Dulux wasn’t available through retail channels because painters and decorators were the firm’s main customers. However in the 1950s, the firm still spoke to consumers in its advertising, telling them to, “Say Dulux to your decorator”. The goal of course was to get your tradesman to buy Dulux.

By 1953 Dulux had gone retail and in the 1960s the The firm became an institution in the UK following a ground breaking advertising campaign featuring an adorable Old English Sheepdog. Nowadays, people of my age often say, “Oh look, the Dulux dog” to bemused children whenever they see an Old English Sheepdog.

Dulux has maintained a very high profile in Malaysia and I have seen numerous billboards, print ads and TVCs featuring bright colours, smiling healthy children and sometimes of course a cute, adorable dog.

It always struck me that this was a questionable strategy, not only because this old mass economy model of spraying money everywhere and praying it would stick with enough consumers to increase sales was rather an archaic approach but also because it was a very Western approach to marketing paint to consumers.

In developed countries such as the UK and USA, home improvement is big business. In the UK alone spending on DIY by householders increased from £7.7 billion in 1998 to £10.9 billion in 2008. The average per household works out at about £700. Interestingly, spending on tradesmen to do the work fell from £6.4 billion to £5.7 billion during the same period.

According to a Euromonitor report, in Malaysia about £300 million was spent in 2008 on DIY and gardening and an average per household of about £20.

One of the reasons for such a difference is that many Malaysians live in apartments but also because it is relatively cheap to arrange for someone else to do your garden and there are plenty of contractors to carry out renovations and paint your house. So the target market in Malaysia should be these small contractors and not consumers.

Anyway, up until this week Euro RSCG, an advertising company had been the incumbent on the brand’s US$100 million global advertising business which it won from DDB in November 2009.

In the last couple of days, Dulux has let the agency go and is now moving away from using a global advertising agency to implement its advertising strategy and instead is giving local markets responsibility for their own campaigns.

This is an excellent move and will hopefully just be the start as other companies such as Patek Philippe, Audi, Lexus, Cartier to name but a few, are all wasting money on traditional mass market global advertising campaigns that may make sense in one market but do little for the brand in others.

Is positioning still relevant today? Part three

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Here are some thought starters related to my belief that positioning is generally a pointless exercise:

According to Industry Week magazine, 70% of today’s manufactured goods will be obsolete in six years. There are estimated to be more than 30,000 new product introductions in the US alone every year, just in the packaged goods market. According to AC Nielsen, up to 90% of products fail. This means that as many as 27,000 of those new products will fail.

Despite approximately US$1.5 trillion spent on marketing annually and over US$500 million spent on advertising alone in the US, the annual US based “Most Memorable New Product Launch Survey 2007”, found that unaided, 77% of respondents could not name one of the top 50 new products of 2007, even if it was a strong well recognised brand.

The development of a positioning strategy takes time and the communication of that ‘position’ will be the responsibility of an advertising agency and that agency will, generally speaking use mass media to communicate the position.

With such short life times and high failure rates, isn’t it time companies reviewed the tools/tactics/strategies/channels etc that they are using to build brands? Don’t they owe it to their shareholders, investors, customers, the environment to do something about this?

What do you think?

Advertising campaigns need to be integrated across the organisation

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Recently I wrote a post about my experiences when I called the number on a billboard selling a luxury automotive brand. You can read the full article here

Basically I talked about how I rang this brand after seeing a billboard outside my office. I got through to the receptionist who asked for my number and said she would get someone from sales to call me back. Nobody called me back, even though the car costs about RM500,000 (US$166,000)! I thought this was an excellent example of why so many brands fail. But I didn’t think much more about it.

Then today I was sitting at a traffic light outside Bangsar Shopping Complex and I saw the same company had another billboard, this time it was advertising their jaw dropping top of the range V10 sports car that costs over RM1,250,000 (US$420,000) in Malaysia. Now this really is an exclusive motor and in the middle of last year there were orders for about 240 of them in the UK and a waiting list of 12 months. If they are only selling 250 odd in the UK I would expect them to sell no more than 50 in Malaysia. So you have to question why they market such an exclusive product on a billboard.

But this is not a rant about using old mass market mass economy models to sell luxury brands, this is about the fact that it is imperative that marketing campaigns are integrated and organisational excellence is at the heart of any tactical campaign.

And I know it isn’t at the heart of this campaign because whilst waiting for the lights to change I decided to call the number on the billboard and see what sort of a response I would get.

I called the number. No answer. Now it was 5.17pm and perhaps the receptionist has gone home. But I doubt the sales team had gone home. I bet they were sitting around wondering how to drive traffic to the showroom so they can make target this month and get a nice juicy bonus for Chinese New Year. Perhaps at least one of them might have been wondering why the expensive outdoor campaign they’ve been running for some time hasn’t generated any results!

I’ve tried to go and see these guys but the marketing manager tells me they are doing well. Here are some basic principles to abide by when you run an advertising campaign so that when you are doing well, you can do better.

1) You advertise on billboards to stimulate, inform, persuade etc. If you want to inform perhaps a 100 people in the country about a luxury product, spending large amounts of money on billboards or for that matter print ads in daily newspapers, is a complete waste of marketing dollars.
2) Consumers who can afford to spend over 1 million Ringgit on a car are unlikely to keep to your office hours. Make it easy for them to spend money with you.
3) Your advertising copy should appeal to a specific audience – in this case, those who can afford over RM1,250,000 on a car – everyone else is just getting in the way. So create copy that will resonates with that target market. This ad just mentioned the engine capacity and that was it! Ever wondered why mini does so well?
4) Develop metrics for measuring channel effectiveness. A simple metric for outdoor ads is a specially assigned number for that campaign.
5) Outdoor advertising is 24 hours. That’s probably one reason why you bought it in the first place! If you can’t have someone on standby 24 hours a day, install an answering machine or after office hours have calls diverted to a sales manager or sales director.

These are elementary and should be included in any strategy document created by a brand consultant.