Positioning Archives - Page 3 of 5

Saturn: A different kind of disappointment

So yesterday, purchase while Beg to Differ was breaking up with the Intel brand, ed we got sad news about another old flame: Saturn is dead. Penske threw in the towel on its attempt to revitalize the brand, recipe and GM is finally shutting Saturn down. We’re feeling sad about that today. We remember when Saturn was promising to be “A Different Kind of Company; A Different Kind of Car.”

As you may have guessed from our name, we like “Different”…

(above) The home page of the innovative "ImSaturn Network" community Web site. Everything looks different... except the cars... and apparently the end of the story...

You can read the whole sad Saturn history at Wikipedia. We’re going to focus on the Saturn brand, and how the promise changed over time, then died, and what brand managers can learn from it.

“I’m sure if everything I read is true, I won’t be disappointed”

Somewhere out there, this third grade teacher from a 1992 Saturn ad (below) must be a bit down today as well. In it, she says she read about Saturn, and makes a personal connection when workers at the company read her letter. If you ever cared about Saturn like us, you have to watch this (Spoiler Alert: it’s really sad in retrospect).

Different worked… for a while.

And I’m sure she was satisfied, for a while. For her, and for the rest of us that were rooting for the “different” approach from the auto industry, Saturn succeeded at building 1) a “Different Kind of” brand promise, 2) a “Different Kind of” corporate mentality, 3) “Different Kind of” retail experience (no haggling), and 4) a “Different Kind of” tribe of devoted followers. They really did. The vestiges of those things are still around.

For example, Saturn has been much better than most other companies at embracing and building community online. Their fan site ImSaturn u r 2 is really engaging, and their marketing team really gets Social Media. A couple months ago, Beg to Differ was shocked and delighted when @tomfolger and a couple of Saturn marketing folks popped in to a Twitter #Brandjam to correct us when Saturn positioning came up.

Unfortunately the vehicles themselves, the “Different Kind of Car” was only ever marginally different from other cars. But the service commitment became legendary, and at least the cars looked just different enough that you could spot a “Saturn” on the road. If only they had built on their differentness…

But that’s where the story turns sour.

The big problem was, the “Different Kind of Company” was always beholden to the corporate logic of GM – a very un-different automotive behemoth. So as the Saturn competed more and more with GM core brands, and sales never quite matched expectations, GM had two options:

Option A: Think like a bean counter = differ less:

The approach: try to fix technical, marketing, and customer service problems by applying the same rusty old car industry logic. Gradually water down the promise and file off the edges, so only the most fanatical still hold on to the hope of Saturn rising again.

Option B: Think like and human being = differ more:

The approach: Keep renewing the vision by continuing to make the cars even MORE different in ways that customers will appreciate, and keep innovating on the corporate, manufacturing, and customer service fronts (preferably by not having it be a GM company any more).

Their choice was clear: differ less

Over the 90’s, the cars looked and behaved less and less different from other cars on the road, and by 2000, the line had expanded to include the same-old range from sub-compact to SUV – diluting the core idea of what a “Saturn” was. The passion and excitement of Saturn customers waned – as did their repeat-purchase loyalty.

So by the late ’00’s, when the really big financial meltdown happened, Saturn was dragged down by the gravity of the GM’s collapse. At Beg to Differ, we can’t help but think that stronger differentiation, coupled with the fierce (and geeky) loyalty of those early believers would have carried them through.

The big questions for brand managers:

Which option are you choosing for your brand – differing more or differing less?
Are you thinking like a bean counter (internal logic) or a human being (brand logic).
Are your corporate pre-occupations hampering your ability to deliver on the human promise of your brands?
If you disappeared tomorrow, would any third grade teachers miss you?

More nostalgia from YouTube.

Japanese language ad: ordinary American country folk buildin’ cars:

Saturn homecoming – playing on the wholesome geekiness of Saturn owners:

10 days to Interbrand top 100 brands (& 10 reasons to care)

In 10 days from now, stuff on September 21 2009, ask the mega-consultancy Interbrand and Business Week Magazine will be releasing their 10th annual ranking of global brands. Interbrand is trying to jack up enthusiasm with this big count-down clock (below). But of course, apart from Canadians who read my Mad at Switzerland rant, the big question is: who cares?

The countdown clock from Interbrand's Web page.

10 Reasons you should care about the
Best Global Brands 2009 list

1) These are the game-changing brands

Just a quick glance at the top ten from 2008 should be enough to show any brand manager that this is a list you a) want to be on eventually, b) need to be at least be aware of and understand the strategies of, and c) need to study, because like it or not, these brands are the rule-makers, breakers, and game changers in the world of branding.

For me, if I’m delivering a presentation or seminar, these are easily the list of examples I always choose from to make any point about branding – not because they do everything right (see my New Coke post and stay tuned for an upcoming pan of Intel), but because they are a common point of reference for most humans on earth.

2) These brands are global

And why are these brands becoming a common language around the globe? Well, the Global 100 ranking system only tracks brands that cross international borders – where more than 1/3 of their revenues come from outside a single country.

This leaves out big brands like many of the Mars chocolate products because they do most of their business in the USA. But it means that the brands that do make the list are much more likely to be household names in most Western countries.

3) The ranking distinguishes between brand & company value

This is where things get a bit tricky, but it’s one of the things that make this ranking important – and different – from most business lists. You’ll notice that the list includes brands that are companies – like Nokia or Google – as well as brands that are the product of parent companies that don’t make the list – like KFC (Yumm brands) or Blackberry (by Reaserch in Motion).

This makes the list a bit messy, like comparing Orange (which didn’t make the list) to Apple (which climbed 9 spots in 2008). But it’s a measure of the brands we consumers have in our heads, not the accident of corporate ownership which changes over time.

4) The ranking measures brand equity

Ultimately, the Global 100 ranking is pursuing the holy grail of brand management, which is measuring brand equity. In financial terms, this is the intangible – but considerable – value of the brands themselves to their owners. In brand strategy terms, brand equity is a measure of the strength of the relationships between brands and their customers.

The three areas they try to capture are the three “tangible” impacts of a good brand: a) the brand’s ability to command higher prices than un-branded alternatives, b) the value of brands to assist people in making purchase decisions, and c) the power of the brand to predicatbly influence future sales through loyalty.

5) It’s not perfect, but it’s the best we’ve got

Okay, I admit that there’s a lot of “special sauce” that goes into these rankings. Any time you are measuring intangible value, there is going to be some fudging.

In his book Branding only Works on cattle (free chapter online here), Jonathon Salem Baskin slams the Interbrand evaluation criteria:

All these assessment and rates are qualitative estimates. This isn?t math, it is religious scripture, created to reaffirm belief to the flock while ginning up enough obfuscation to dissuade nonbelievers.

Ouch. I have my own problems with and suspicions about the Interbrand methodology (E.g. the fact that Thomson Reuters vaulted into the rankings shortly after an Interbrand-led rebranding), but unlike Baskin, I’ll go with the rankings – not because they’re gospel, but because they capture the essence of something important that no one else has measured any better.

6) The world has changed

And this year, above all others, it will be fascinating to see how the rankings move after the great financial meltdown, the Obama factor, bail-outs, shrinkages in consumer spending, etc. Who’s moving up? Who’s moving down? Enquiring branders want to know.

7) Great Brands brand countries

And as I pointed out again in Swiss Secrets a few weeks ago, brands and countries have a symbiotic relationship. Who can look at any of these brands (right) without thinking of their countries of origin. IKEA is to Sweden as Verdana is to Microsoft… er wait.

8 ) Suspense: Will the US majority fall?

The US will again dominate the rankings as it had 52 brands in the top 100 last year. But after the melt-down, it wouldn’t take much to knock it off its 50+ pedestal. The rest of us wait with eager anticipation.

9) Suspense: Will Canada maintain or build its share?

We had our first two brands ever in the top 100 last year – Blackberry and Thomson Reuters. So will any more iconic Canadian brands join them on the list? The big Canadian banks all survived the melt-down with no bail-outs required, and TD and Royal Banks have started making inroads into the US market – as has newly repatriated Tim Hortons. But will any of them launch into the Top 100 limelight? I suspect not, but then, I may just be an overly modest Canadian.

10) Suspense:Have the “emerging economies” arrived yet?

The biggest question to watch this year and in the decade to come is this:
how quickly can the currently unrepresented powers like China, Russia, India establish a foothold and begin to build global brands?

They have already surpassed most Western countries in population and manufacturing and are catching up quickly in many other areas. But as yet there are no really big brands from these countries. That will change (see Enter China’s Consumers), but it remains to be seen when it will begin to shake up the brandscape as we know it. Perhaps we’ll get a hint on September 21.

I, for one, can’t wait.

If you’re an eager branding beaver as well, you can sign up here and Interbrand promises to “send you all the information as it goes live.”

YouTube message from Interbrand CEO Jez Frampton

Warning: it’s a bit of a yawn – with surprisingly low production values for Interbrand. I can get away with handy-cam rants, but surely the big guy could have rented a studio, and maybe dropped a few more substantive hints? Perhaps that’s why he had only 300 views as of this morning – even though it’s auto-running from the Top Global Brands Web Page.

Discovered: the one immutable law of branding

In 2002, viagra I read the first edition of the book The 22 Immutable Laws of Branding by the legendary Al Ries and his daughter Laura. It changed my life. But it got me thinking…

Perhaps not so immutable after all?

One law to rule them all

I’ve been mulling over the 22 laws the book posits. All of them are thought provoking, cost and all are valuable, and I’d argue that the book is just as important for branders as Positioning: The Battle for Your Mind.
But, at the risk of sounding like a heretic, after more than a dozen years in brand communications, and dozens of projects with all kinds of customers in different industries, I’ve come to realize that all 22 Immutable Laws can be summarized in one over-arching Law:

*This is because 1) brands are owned by humans, cultivated by humans, and are a human communications technology; 2) humans are not immutable, and 3) therefore our strategies for branding have to be as nuanced and flexible as humans, even while we try to impose order, consistency, and intelligence upon them.

Read the book

So, by all means, please read the book! But as you do, think how each law needs to be adapted to your product, your customers, and the brand new world we all find ourselves in today.

New Coke 25 years later: was it all just a brilliant conspiracy?

Yesterday, in five more brand strategy lessons from the Princess Bride I used New Coke as an example of how customer research can occasionally lead branders astray. But thinking about it, two things struck me: First, that April 23, 2010 will be 25 years since the launch of New Coke. Second, I turn forty tomorrow, so that spring day in 1985 was when my fifteen-year-old self realized for the first time:

Brand strategy isn’t a cold, abstract business decision made by far-away executives. It’s personal! THEY WERE MESSING WITH MY COKE!!

Ah the good old days – when a company could just change its brand without fear of consumer backlash…

A brief history of New Coke

For those of you who were too young in 1985 to remember – or maybe you were bricked up into the walls of a desert hermitage during the 1980’s – and who can blame you really? – here’s a brief blow-by-blow of events around this seminal consumer branding event.

- Pre-history to present – Coca-Cola launches, and retains market leadership, in the soft drink market. Fortunes are built on dark, bubbly sugar water.
- 1975 – Pepsi launches the Pepsi Challenge – a campaign of blind taste tests in which consumers really did choose Pepsi over Coke for the most part.
- 1975-1985 – Coke market dominance gradually slips – mostly under pressure from Pepsi. Coca-Cola executives realize that the threat is serious, and it seems to them that taste is a key battlefield.
- Early 1985 – rumours circulate that Coca-Cola is testing a new formula. And indeed they are. Thousands of consumers choose the new sweeter flavour in blind taste tests like those used in the Pepsi Challenge. No one tests whether the taste actually influences the purchase decision when users are aware of the brand.
- April 23 1985 – To great fanfare (followed by an enormous “thud”), chairman and chief executive officer Roberto Goizueta announces New Coke to the world as a better tasting alternative to the old Coke that was still dominating the world’s brandscape.
- Supporting “the Cos”: In an act of selfless, heart-warming altruism, Bill Cosby brings his considerable charm to bear on the issue telling the world that he personally prefers the new taste.

- April 23 1985 – Meanwhile in Ottawa Canada, a pencil-necked grade nine kid in a Hewey Lewis and the News concert t-shirt hears… the news. And although prior to this, he has only been an indifferent cola consumer, the news wallops him with an odd mixture of horror and deep personal indignation. At lunch, he and his friends talk in whispers and look to the sky for other signs of impending apocalypse.
- The Canadian Broadcasting Corporation broadcasts this scathing critique of the move. Check out the footage of the press conference “tasting”, the video message to retailers, and the response from Pepsi in which they declare victory in the Cola wars and give employees a celebratory holiday.

May, June 1985 – Stories circulate in the press of wide-spread hoarding of Coca-cola. Anecdotes like this one (of many) from the Coca-Cola Heritage site give a sense of the real urgency and panic that many consumers felt.

When the new Coke came out, I borrowed my friend’s pick-up and went to a club store and bought three pallets of regular Coke. It took two trips to get the Coke home. I had enough Coke to last me through the crisis, but I had to repair the floor in my spare bedroom – because of all the weight, the floor had sunk. It was well worth it.

Petitions are circulated, rallies are held, activist groups like the “Society for the Preservation of the Real Thing” and “Old Cola Drinkers of America” are formed, and Coca-Cola is swamped with angry response:

By June 1985, The Coca-Cola Company was getting 1,500 calls a day on its consumer hotline, compared with 400 a day before the taste change. People seemed to hold any Coca-Cola employee – from security officers at our headquarters building to their neighbors who worked for Coke – personally responsible for the change.

July 11, 1985 – Coca-Cola announces that they will be offering the old formula in parallel with the New Coke – which they call “Coca-Cola Classic”. There is widespread rejoicing.
In the decades that followed of course, New Coke became Coke II and then quietly disappeared as “Coca-Cola Classic” became the name for standard Coke again.
2007 – In Canada, the “Classic” was quietly dropped, but it remains on American packaging – albeit in smaller and smaller letters.

Brilliant conspiracy or colossal blunder?

But along the way home from their corporate Waterloo, a strange thing happened: Coca-Cola actually accomplished what they had set out to do in the first place: “to re-energize its Coca-Cola brand and the cola category in its largest market, the United States.” Coke sales surged, consumers breathed a collective sigh of relief, and Pepsi resigned itself to a seemingly permanent runner-up position in cola sales.

So of course, many conspiracy theorists have emerged claiming that Coca-Cola had planned this all along. But as they publically say on their Web site: “The company didn’t set out to create the firestorm of consumer protest that ensued”. Of course, they do try to put a positive spin on this bottle (with a little kiss of revisionism at the end):

The return of original formula Coca-Cola on July 11, 1985, put the cap on 79 days that revolutionized the soft-drink industry, transformed The Coca-Cola Company and stands today as testimony to the power of taking intelligent risks, even when they don’t quite work as intended.
(emphasis mine)

So here’s the real thing

That phrase “taking intelligent risks” doesn’t capture the enormous arrogance, ignorance, and shocking naïveté that went into the decision in the first place – and doesn’t capture the huge embarrassment and sense of crisis within the Coca-Cola company, or the tsunami of indignation that swept consumer society at large.

To sum up: New Coke made the corporation look really, really dumb. (But we forgave the brand).

Their big mistake (and it was a mistake): they treated the launch of a new formula as a problem that could be solved with product research, business logic, and a big ad campaign. In other words, they acted as if they had the right as a company to make such decisions, and we the customers would obviously be grateful.

The huge branding truth that became clear to this pencil-necked Hewey Lewis Fan:

Coca-Cola didn’t own their brand; I did.

Lessons for branders:

1) Respect the owners of your brand – your customers.

Yes, you own your “formula”, but they own the expectations and experiences built up over time – which are ultimately far more important than your brilliant launch plan.

2) Freedom’s just another word for everything to lose.

Coca Cola didn’t win because of New Coke, they won in spite of it – and because they were smart about getting out of it. For 99.9% of brands, a misadventure like this would be fatal.

Swiss secrets – how Switzerland builds brands

Those pesky Swiss are at it again. In a tongue-in cheek June post, stuff I ranted a bit about how I was mad at Switzerland for being so much better than my country Canada at building global brands. Well now my favourite brand strategy blog in the world brandchannel.com has taken up the cause with this piece. So here are 5 Swiss secrets that I’ll distill for you.

The Swiss success at branding isn't an accident. It seems to be a culture they cultivate. And you?

1. Sweat the small stuff. Think precision.

A country can be a great brand. But it isn’t an accident. It takes careful work, pill discipline, and an attention to detail – think of a fine Rolex or Tag Heuer watch. Switzerland is tiny, but by carefully tuning and refining the little gears that run their brand image, they’re ensuring they’ll be winners for generations to come.

2. Refine the recipe. Make it intentional.

The Swiss have thought through all the ingredients of their brand, and the results are published in a fantastic brand manual that speaks for itself. And it’s right there online for the world to see. It is that sense of refinement and building on tradition with consistency that has bred great chocolate and food brands as Nestlé, Toblerone, and Lindt.

3. Trust: the logo is just the tip of the Matterhorn

Trust is not spoken. It must be earned through consistent behaviour over time. You can’t just stick a Swiss flag on your product – even if you’re a Swiss company. The Swiss have very stringent rules and a continuing debate around what high level of quality constitutes “Swissness”. Which leads to better products and more trust, and more value for the Swiss trademark. It’s all tied together.

Swiss banks like UBS and Credit Suisse and indeed the whole Swiss financial industry have built their reputations around the brand promises of “stability, privacy and protection of clients’ assets and information“. This has led to recent wrestling matches over the personal information of US tax dodgers. But even if their hands are forced, the Swiss banks do fight tooth and nail for client privacy.

4. The three key tools of the Swiss brand

A great country brand is adaptable, sturdy, and practical. In the case of brand Switzerland, they are building their brand built around three key tools (“pillars” of their brand platform):

1) Reality – the country’s real strengths and limitations, both in the sense of real business assets and liabilities, but also in terms of physical location, historical facts, shifting allegiances, and other tangible influences.
2) Existing perceptions – how the country is perceived abroad – for better and worse. The smart brander draws on positive themes that already exist in the minds of outsiders that only have to be tweaked, not created from scratch.
3) Intangibles – positive, but subjective, forces driving the country’s brand like a track record of innovation; internal attitudes to themselves (and to change); and all the other internal brands that are already successfully trumpeting the idea of the country in the marketplace.

5. Apply the same logic to your brand.

Read those 3 pillars again, and insert “company” or “charity” or “government service” where it says “country”. Then check out the brand manual linked above.

So ask yourself:How are you doing?

Is your brand running like a Swiss watch, as trusted as a Swiss Bank, as mouth-watering as fine chocolate, or are you just yodelling your customers’ time away on a mountaintop?