Ries' Pieces

Tim Tebow, the brand

Tim Tebow is the hottest story in sports. While the Green Bay Packers are charging ahead with an undefeated record, everybody is talking about the Mile High Messiah and Tebowing.

How did this happen? What can you learn from it?

 

The Keys to Tebow’s brand success:

 

1. Be Different.

While there is nothing new about the collision of faith and football, Tim Tebow went out of his way to show PDF – public displays of faith. He also lives the life of a church going goodie-goodie. No alcohol, no smoking, no drugs, no sex (he is staying celibate til marriage.) His outspoken and open faith made him different, and different gets attention, and attention gets people talking and people talking builds a brand. Everybody knows Tebow.

 

2. A bit of controversy.

What really put Tebow on the map was his highly controversial 2011 Super Bowl anti-abortion ad. He was heading to the draft, he was lining up sponsors, but he went ahead and did the ad anyway. It wasn’t wise in terms of his marketability, but the controversy generated a lot of publicity. His decision also showed his strength of character to do what he believed in no matter what others said.

 

3. Be the underdog.

If you can't be Goliath, then David is the next best thing. There is nothing that fans love more than cheering for an underdog and seeing him win. Sure Tebow was a national college champion and Heisman trophy winner, but most pundits gave him little chance in the NFL. With a weird throwing motion, he was the 4^th string quarterback at the Denver training camp. But Tebow worked really hard, proved himself to his team and finally got the starting job.

 

4. Love or Hate me.

Being boring doesn’t make you famous. Having people love you or hate you is much more effective. Tebow is very loveable, humble and honest. His teammates love and respect him. And he has shown great leadership skills by inspiring other players to pull together and achieve beyond their limits. To some he is too perfect and too likable. But that is ok too, extremes are what get people talking. Being perfect is great (advertisers love it) as long as you don’t fall off the pedestal like Tiger Woods or Martha Stewart. But once build even brands like Tigers and Martha's survive.

 

5. Winning.

Nothing succeeds like success. What has cemented the Tebow brand is his unbelievable recent winning streak. Winning is the best fuel to ignite any brand. Mix Tebow’s faith, personality, and his winning streak and you have what we have today, the hottest brand in football. Tebow’s leadership and 7 game winning streaks has taken a once lame Broncos to the most talked about team in the NFC. Aaron Rogers should take some notes, his Green Bay Packers team is famous, but his personal brand is lacking.

 

Tebow’s faith has been a mixed blessing when it comes to his marketability with advertisers. In general, advertisers want to stay as far away from controversy as possible. Look at the craziness over Lowe’s running ads in All-American Muslim. But advertisers also want to attach their brands to the most talked about players that fans love. That is why Tebow has been contracted by Nike, Jockey and others. And if Tebow continues to win, advertisers will continue to knock down his door.

 

Tebow's image as a clean cut, all-American, winning quarterback is irresistible to corporations. However, if Tebow appears in more anti-abortion ads, gets into drugs or hookers. Well, it is all over. At least in the short term. Like it or not people always love a comeback and story of redemption. Winning makes people forget even the worst offenses. Just ask Michael Vick.

The Secret of Steve Jobs

    Steve Jobs was a rebel who didn’t go about life or work in the normal way. He dropped out of college, was a fruitarian for a time and was often called an arrogant, obnoxious, weirdo.

    Being a rebel, however, wasn’t the secret of Steve Jobs. In our youth-obsessed culture, rebels are a dime a dozen.

    Steve Jobs was a technology genius. From an early age, he was fascinated by electronics. He tinkered at his father’s workbench and joined his high-school electronics club. Jobs was so gifted that Atari's chief technology engineer gave him a job as a game designer even though he had no formal technical training.

    But being a technology nerd wasn’t Job’s secret either. Silicon Valley is filled with brilliant technology nerds.

    Steve Jobs was a design genius.  He was obsessed with creating tools that were not just good but beautiful. And his aesthetic sense didn’t just apply to the outside of things; even the inside of things had to be beautiful. On the Apple II, for example, Jobs insisted that the circuits be redone to make the lines straighter.

    But being a design genius wasn’t the secret of Steve Jobs either. Check out your local Ikea; it is filled with wonderful designs.

    The world has many great rebels, great technology geeks and great designers. What made Steve Jobs so unique was his supremely-gifted marketing ability.

    Here are some examples of the marketing decisions made by Steve Jobs. Decisions that put Apple on the path to becoming  the world’s most valuable company.

 

The power of a simple brand name.

    In the 1970s and 1980s, there were hundreds of brands of personal computers on the market. Many of these brands were line extensions of existing brands: AT&T, Burroughs, Dictaphone, Digital, ITT, Memorex, Motorola, NCR, Radio Shack, Smith Corona, Siemens, Xerox and many others.

     Many of these brands were new brands with strange names: Osborne, Commodore, Micro Pro and dozens of others.

    The difference between Apple and the other brands wasn’t in the hardware. It was in the name. Apple was a simple name consumers could instantly associate with the home market. The name also allowed a simple "apple" visual which hammered the name into prospects' minds. (How would you visualize Micro Pro?)

    Furthermore, Jobs resisted the path that many entrepreneurs take. That is, giving the brand his own name. Would Jobs Corporation have become the world's most-valuable company? Or even worse, how about Jobs & Wozniak Corporation?

 

The power of a second brand.

    During a 1979 visit to Xerox’s Palo Alto Research Center, Jobs saw a prototype of a computer with a graphical user interface. Rather than typing commands, users rolled a mouse and clicked on menus. This technology fit with Jobs' philosophy of making computers that were dead simple to use. He immediately started working on replicating the technology.

    On January 24, 1984, Apple released the Macintosh. Previously, the product line included such names as Apple I, Apple II and Apple IIe. But this new computer got its own name and thereby created its own new category. Most companies would have called it the Apple III, but not Steve Jobs.

 

The power of an enemy.

    Sometimes the best way to position a brand is by figuring out who your enemy is and then being the opposite. Apple's obvious enemy was IBM which had about 50 percent of the PC market.

    That is exactly what Jobs did with the famous 1984 Super Bowl commercial announcing the launch of the Macintosh. What made the commercial so powerful was that almost everybody instantly recognized Big Brother, who represented "conformity," as a stand-in for IBM. He repeated the same strategy later with the Mac vs. PC guy ads.

 

The power of being first.

    In his career at Apple, Steve Jobs did this over and over again. Launching a new product that was the first brand in a new category.

    Pixar's Toy Story. The first feature-length animated movie done entirely on computers.

    Apple's iPod – the first hard-drive music player.

    Apple's iPhone – the first touchscreen smartphone.

    Apple's iPad – the first tablet computer.

 

The power of a diverging category.

    Initially we were skeptical of the iPhone. Jobs had described his new brand as a combination iPod, cellphone,  email-and-internet device, all rolled into one. A red flag went up in our head since convergence devices are typically flawed.

    The Nokia Communicator had been on the market for a number of years, it was a combination personal digital assistant and cellphone and it was a total loser. But in reality, the iPhone was not a convergence device. Jobs may not have explained it correctly initially, but no matter. The iPhone exploited the divergence phenomenon by becoming the first “touchscreen” phone.

    But it wasn’t just the touchscreen that would be the iPhone's greatest achievement. It was the way the iPhone handled the many hundreds of thousands of apps created for the new device.  What email did for BlackBerry, Apps did for iPhone. Apps made the iPhone more than a cellphone, more than a music player, more than an email device, more than a web device. iPhone was a totally new touchscreen App device.

 

The power of the verbal.

    When you are the first brand in a new category, consumers need extra help in understanding what you are selling. Steve Jobs had an amazing ability to simplify not just his products but his product messages as well.

    With two words, “Think Different,” Jobs communicated the essential difference between the Macintosh and every other PC.

    With five words, “1,000 songs in your pocket,” Jobs communicated the essential difference between the iPod and the other MP3 players that could only hold 30 songs.

 

The power of the visual.

    Words can communicate a message, but visuals can reach consumers emotionally in a way that words cannot. Jobs understood the power of visuals like no other CEO on the planet and effectively used simple visuals to build his brands.

    The rainbow apple for Apple.

    The white ear buds for iPod.

    The even better white apple for Apple Inc.

    Job's presentations were also powerful visually. First was his consistency of dress. From 1998 to 2011 (the era of his return to Apple), he always wore a black turtleneck and jeans for his presentations. Even more impressive were the slides he used during his famed presentations. No text-filled PowerPoints for Steve. Nothing but a huge screen with just a single image and a few words on each slide.

    A picture is worth a thousand words.

 

The power of multiple brands.

    Apple didn't get to be the most valuable company in the world by expanding one brand into multiple businesses.  Apple launched multiple brands.

    In the beginning, Apple Inc. made the Apple computer. But no longer. The Apple computer died along with the home-computer category.

    Today, Apple is a company name, not a brand name. And a good one at that. Apple Inc. owns the brands: Macintosh, iPod, iPhone and iPad.

 

    No CEOs make decisions and follow the principles of branding the way Steve Jobs did. He has left us an amazing legacy.

    Future leaders should study Steve Jobs and his accomplishments so that they too can build brands the way Jobs did. If you build brands like Jobs, you can build the next most valuable company in the world.

 

Netflix Strategy is Right and Wrong

There are several important lessons to be learned from the Netflix brand story. In recent days, the story has heated up after CEO Reed Hasting’s Sunday night email blast and blog post.

In his email, Hasting apologized profusely, then turned around and further enraged his loyal 23-million subscriber base by taking the Netflix brand away from its red envelopes. Let me break down the good, the bad and the ugly of this classic story.

In the beginning.

Netflix was founded in 1997 and two years later it became the subscription-based DVD-by-mail service millions of customers in the United States and around the world were incredibly passionate about.

Netflix turned the Blockbuster model on its head. With its strict and steep late fees, Blockbuster created a lot of unhappy customers. So Netflix did the opposite and let consumers keep a movie as long as they wanted. When they returned one movie, they got another one.

It wasn’t as fast as Blockbuster; customers had to wait to get their DVDs in the mail. But no late fees, the fun of picking out your own movies, and the excitement of seeing the red package in the mail built a powerful Netflex brand.

Intense consumer loyalty and unbelievable word-of-mouth helped the Netflix brand took off like a rocket. Ten years later, Netflix had a library of 100,000 titles and 10 million subscribers.

Today, Netflix has 23 million subscribers, a high-flying stock and is very profitable. Last year its stock increased over 200%. Revenue in 2010 jumped 29% to $2.16 billion and net income was up 39% to $161 million. But with profits sometimes comes arrogance.

 

What’s next

One thing is always certain with technology: change is coming. In music, we went from record, to tape, to CD to digital. In video rental, we went from Betamax, to VHS, to DVD, to pay-per-view, to digital streaming.

Yet, it takes time for a new technology to completely replace an old one. This leaves existing brands in a bind. Do we stick with our profitable bread-and-butter product or do we move to the new technology? It might be small now but one day will probably take over the industry? How do we cross the chasm?

Netflix owns movies-by-mail. They might make a lot of money today, but are not the future. Netflix has wisely bet on streaming as its future. And they have wisely made an aggressive move to be first in the mind in order to dominate the new streaming-video industry. Currently, Netflix is the leader in the category.

But Netflix made a critical error by using the same name on its new streaming business as it does on its existing mail business. It might be logical to take a trusted and loved brand name and extend it from one business to the next. But it doesn’t make marketing sense. As time goes, each business will compete and clash with each other. Having the same name on both businesses is confusing from both a product and especially a pricing stand-point.

What Netflix needed was a new brand name. In his email to subscribers,  Reed Hastings eloquently points this out. Except there is one huge problem. Netflix needed the new name for the streaming business and not the mail business.

Netflix means mail. You can’t move a brand so strongly held in the mind into a new position, especially one that is more technologically sophisticated. It is the same reason Barnes & Noble had trouble moving online for books (with the B&N name.) Or Blockbuster had trouble moving from stores to mail or streaming with the Blockbuster name. Both Barnes & Noble and Blockbuster needed new brand names for their online businesses. Now Blockbuster is bankrupt and Barnes & Noble is in trouble. They lost $74 million on sales of $7 billion last year.

Too late

Netflix also made a huge error by doing the name change now. The time for the new streaming brand name was when it launched its streaming business. Not several years later.

Netflix should have launched the new brand using its strong Netflix brand as the endorser. Never underestimate the power of a second brand. Especially when it is launched by a leader. Toyota successfully used this strategy when it launched Lexus, Scion and Prius.

You can’t change the past, but this summer Netflix had much better options than the ones it chose. In July, the company announced price hikes and new separate streaming plans. Almost two months later, it took the Netflix brand away from the 23-million loyal subscribers who love it and slapped it on its streaming service.

To add insult to injury, Netflix will give its movies-by-mail customers a new brand name, Qwikster. Why not just throw your customers down and stomp on their faces?

This summer, the better alternative would have been to buy Hulu. Netflex could then have used Hulu as its streaming TV/movie brand. Netflix, of course, would remain as the mail brand.

When you need a better name, buying a company to use its name can be a great strategy. Chemical Bank bought Chase. And ValueJet brought Airtran.

And if the rumors are right, and a spin-off is in the process, leaving the Netflix name with the mail business would make it more desirable to potential investors. Who wants to own Qwikster? The value of a business has a lot to do with a strong brand name.

For Netflix the future is uncertain. They have created a mess of their own making which has gotten customers extremely angry. The strategy of keeping up with a rapidly-changing technology by launching a second brand was an astute one. Unfortunately they fell down on the branding part and got it all backwards. Netflix is mail and the new brand should have been streaming. Sad to see it happen to such a nice company. Reed, next time call me first.

Walmarts needs to stop being so cheap. At least when it comes to advertising.

Published by AdAge.com, August 22

            In a down economy with consumers pinching every penny, you would think that sales at a retailer synonymous with "cheap" would be up, not down. Yet sales at Walmart have been down for two years in a row. Actually, that's nine straight quarters of decline.

            The only good news at Walmart is profits rose this quarter 5.7%, but that was mostly due to cost cutting and international growth.

            The really bad news is that Walmart's core U.S. business, which accounts for 62% of sales, is in a seemingly irreversible slump with fewer consumers coming into stores. How can this be? And what can Walmart possibly do to reverse it?

            The answer has nothing to do with better-looking clothes, smaller stores or launching a Facebook page. The answer is all about reinforcing and defending the Walmart brand in the mind.

            So how does the world's largest retailer defend its position in the mind?

            Advertising. Massive advertising that reminds consumers in a memorable way what the Walmart brand stands for. But here is where Walmart is making three classic mistakes.

1. Walmart isn't spending enough money on advertising.

            Unless you spend enough to get above the noise level, money spent on advertising can be extremely wasteful. That's why mass-media advertising for a brand that isn't well known or doesn't have enough money to spend is ill advised. A brand like this is better off doing PR, social media and anything else it can think of.

            For big brands, there is little PR potential, unless it is bad news or an earnings statement. Nobody covers burgers at McDonald's or how real Coca-Cola tastes or how exciting cellphone plans are. For big brands, most other tactics like social media, when taken by themselves, are too small in comparison to the size of the company and number of consumers.

            The most effective way to protect a well-known brand with mass appeal is with mass advertising. If you can afford it, nothing is more powerful than mass advertising to protect and defend your position in the marketplace and in the mind. That's how leaders manage to stay leaders for long periods of time. By spending only a few percentage points of sales, they can dominate the media and outspend their competition. AT&T spends $2.9 billion on advertising. American Express, $2.2 billion. Walt Disney, $1.9 billion. Comcast, $1.8 billion. Toyota, $1.7 billion. Anheuser-Busch, $1.3 billion. McDonald's, $1.2 billion.

            The leader has the ability to way outspend the competition. Look at McDonald's vs. Burger King. Most consumers think Burger King's burgers taste better, but it doesn't matter. McDonald's dominates the category by spending $1.29 billion on advertising. Burger King spends almost $400 million, which buys a lot of advertising. But since McDonald's outspends them three-fold, Burger King's message gets lost and the brand suffers.

            Walmart spends $2.1 billion a year on advertising. But compared to other retailers, Walmart is underspending in relation to its sales. Walmart spends 0.8% compared to Target at 2.2% and Sears at 4.7%.

            Walmart should be way outspending Target. If Walmart spent 2.2% of sales on advertising, that would be a $5.72 billion budget, which would be almost four times that of Target's and make Walmart the biggest U.S. advertiser.

            That's what leaders do. And that's what keeps leaders more dominant, more profitable and faster-growing than their competition.

2. Walmart doesn't spend its advertising money in the right medium.

            Out of a $2.1 billion budget, Walmart spends only $524 million on TV advertising. While Walmart is a top 10 overall advertiser, it doesn't make the list of the top 10 TV advertisers. AT&T spends $1.5 billion on TV alone.

            Instead of TV, more than half of Walmart's budget is spent on unmeasured media, presumably newspaper inserts and shopper marketing.

            Can you name the last time you saw a Walmart commercial? I watch a lot of TV and I can't. But I do remember lots of Target ads. And a ton of AT&T ads.

            For most brands, TV is the place to avoid. But not for Walmart. The world's largest retailer needs to have a dominant presence on the world's largest advertising medium: TV.

3. Walmart doesn't use the right message.

What is a Walmart?

            Most consumers would answer "low prices." Many people say cheap, but Walmart didn't build its brand on cheap stuff, it built it on selling brand names for the cheapest prices. Which is why the "Always low prices. Always" tagline did such a good job of reinforcing the brand position.

            Why change a good thing? Marketing isn't about tinkering. It is about finding what works and sticking to that. Sure, some minor tweaks are needed over the decades but major change should be avoided.

            So what did Walmart do? It scraped its logo for a wimpier-looking font and sunburst trademark. Then it changed its tagline to the unmemorable, undistinguished "Save money. Live better."

            Everybody says they save you money. And who advertises they are making your life worse?

            What makes Walmart a powerful brand is the guarantee inherent in the name that it has the lowest prices. Always.

            So what is Walmart doing now? Advertising a "guarantee to match competitor's prices." Wait a minute, I thought the low-price guarantee was met by just walking in the door? Advertising that you will match prices is the same as admitting you might not always have the lowest price. Not a good direction for a brand like Walmart.

            Sam Walton might be proud of the meager 0.8% of sales that his Walmart is spending on advertising. But today Walmart isn't a handful of stores in a couple of small towns. Walmart is the world's largest retailer and it need to start acting like one.

Google Today, Gone Tomorrow?

    What’s a Google? It’s a search engine. Want to find something online, you Google it.

    Advertising, the money making machine for Google, accounts for practically all of its revenue. Google also depends mostly on the English-speaking market in the United States and the U.K. for 59% of its revenue.

    After domination of a category like search, the question business leaders and investors always have is, What's next?

    What's next is usually taking the incredible success of the mother brand and extending it into new areas. As well as gobbling up lots of other companies and rebranding them with the same brand name.

    This is exactly Google's pattern today. And it's exactly the pattern of many companies yesterday. Companies like Microsoft, AOL and Yahoo.

    If you know me, you know what I’m going to say next. It is a mistake.

    The power of a brand comes from its ability to own a word in the mind. The more things you put your brand name on, the weaker that name becomes in the mind.

    Say Yahoo to somebody today and they yawn. It means nothing because it over-extended and over-expanded its brand, leaving itself vulnerable to competition.

    Say AOL and you think dial-up and failed mergers and expansions.

    In the short term, it is hard to see the dangers of expansion. The "Let’s Google everything" strategy gives a boost to the company and more importantly the stock. While consumers and investors get fooled into thinking the strategy is sound, it is not.

    (Company leaders who think in the short term are likely to run their companies into the ground.)

    Yesterday, Google announced it was going to rename several non-Google brands as Google products. So say goodbye to Picasa and Blogger. Hello Google Photos and Google Blogs.

    This is on top of the other Google brands such as: Google Alerts, Google Earth, Google Image Search, Google Labs, Google Local, Google Mobile, Google News, Google Video, Gmail, Google Analytics (Web traffic measurement), Google Chrome (Web browser), Google Desktop Search, Google Language Tools (translation tools), Google Talk (instant messaging), Google Toolbar.

    But Google isn’t stopping there, its much-talked-about social-networking brand Google+ is coming soon. Google hopes Google+ will be a Facebook killer.

    Just like Bing was going to be a Google killer?

    The problem with Picasa won’t be solved by calling it Google Photos. The problem with Picasa is that wasn’t first and doesn’t dominate its category. Flickr does.

    Launched in 1999, Blogger was one of the first blog-publishers. But its generic name made it harder to cement the Blogger brand into the mind. In 2003, Google bought Blogger.

    Google has done better with other acquisitions that not only were pioneers in a category like Blogger, but also had superior brand names. Namely, YouTube and Android. Wisely, Google plans on changing neither of these names.

    Google is a monster today. And like most monsters, it thinks it is invincible and not subject to the laws of marketing. But nothing could be further than the truth.

    Google should study history. They don’t want to be the AOL or Yahoo of tomorrow. Google needs to surround its strong search brand with other brands and other brand names that dominate new emerging categories.

     Toyota did that with Lexus, Prius and Scion. Google that Google.

Social Media is a Tactic not a Strategy

            It’s the headline of our times “Brand X Moves to Social Media.” It’s the hottest trend in marketing with executives from the corner offices at Coca-Cola to the front lines at the local barber shop talking up Twitter, Foursquare, Groupon and Facebook.

            Since the Great Recession hit, we have been forced to do more with less and what better way to accomplish this than with social media. Compared to traditional advertising, a social media campaign is cheap. But is it effective? It all depends.

            After we wrote the 2002 book “The Fall of Advertising & the Rise of PR” a lot of companies got excited about PR. They ran out to hire PR companies and to launch PR campaigns. This resulted in a lot of lame and ineffective PR campaigns.

            Any company can run an advertisement, but with PR there are no guarantees. You can hire an agency, host an event, run a contest, pay a celebrity, launch a website, pitch reporters and bloggers alike and sometimes the media doesn’t cover it, nobody notices it, nobody tells their friends or hits the “like” button on Facebook.

            And the same is true with social media campaigns. What is social media anyway?  It is an evolutionary development of PR and word-of-mouth marketing. The internet has allowed people to interactively communicate in real-time, 24/7 on a global basis. Both PR and social media are tools but to be effective they need the right brand strategy first. That was the point of our book. We didn't talk about why "doing" PR was good for any brand, we talked about how PR gives new brands credibility and how to develop the right brand strategy to help make a PR campaign effective.

            The goal of marketing is to get your brand into the mind of the consumer. To own a word or a category in the mind. Starbucks owns high-end coffee shop. Google owns search. Twitter owns tweets. BMW owns driving.

            The first question any company must ask itself is, what does our brand stand for? Unfortunately, that question rarely gets asks. Instead, the focus is on what social media can we get into? Too many companies get PR, social media or advertising campaign all wrong. They forget that the brand strategy should come first and the execution should follow. Doing it in reverse doesn’t work.

            A typical example is a headline in today’s NYT “The Tupperware Party Moves to Social Media.” The Tupperware Brands Company has decided to greatly increase its presence in social media like Facebook and Twitter. They will have a Facebook page devoted to the theme “Chain of confidence” and feature women who will be confidence counselors. The company hopes to use social media “to reach out to a younger demographic in a more interesting and dynamic way.” The goal “is to find more disruptive methods to dispel perceptions that we are your mother’s Tupperware,” said Rick Goings chairman and chief executive of Tupperware.

            First thing first. What’s a Tupperware? It’s a party your mother bought plastic tubs at. Changing that perception in the mind is going to be difficult. A Facebook page and a few YouTube videos about confidence are unlikely to change that perception at all.

            “Chain of Confidence” what the heck is that? Since when do confidence and plastic tubs go together? Sure, I get what they are getting at: Women who work for Tupperware gain confidence and skills. But Tupperware doesn’t own confidence; it owns plastic tubs sold direct.

             Broad ideas like confidence and quality aren’t specific enough to be ownable. And even if you want own something like “great customer service,” you don’t do it with a “we love our customers Facebook page.” You do it with a specific and tangible concept like: “Free shipping. Both ways.” The concept that put Zappos in the mind and gave Tony Hsieh something to tweet about.

            What Tupperware needs to do first is focus on the idea. What idea can Tupperware own in the mind? They have to start from where they are at and slowly shift that. Plastic tubs save food. People are eating at home more, bringing lunches to work and school more. I would start with that. There is also the idea of saving the environment. Instead of throwing cheap plastic containers away, you buy Tupperware and keep them around a lot longer.

            Nothing is going to help overnight. The problems at Tupperware have been brewing for a longtime. And many of these ideas would have been better implemented years ago. Nothing works better than pioneering an idea or movement.

            Instead, most brands muddle along and introduce brand extensions like Tupperware stainless-steel pots and pans and rush to do social media not because it makes sense for the brand but because it is the trendy thing to do today.

            Marketing isn’t trendy. It’s simple.

            Focus. Own a word in the mind. Then decide the tactics.

            And if your brand is yesterday’s news, consider the possibility of launching a new brand.

            Social media actually works the best for new brands that are (1) focused (2) appeal to a new generation and (3) have news value.

 

Crazy for Consumers? RIM is insane.

 

            Mike Lazaridis, one of the two chief executives of Research In Motion, is baffled and defensive. In a rare interview, Lazaridis complained, whined and spent more time asking questions than answering them.

            “Why is it that people don’t appreciate our profits?

            “Why is it that people don’t appreciate our growth?

            “Why is it that people don’t appreciate the fact that we spent the last four years going global?

            “Why is it that people don’t appreciate that we have 500 carriers in 170 countries with products in almost 30 languages?”      

            To make matters worse, the exasperated Lazaridis ended with: “I don’t fully understand why there’s this negative sentiment, and I just don’t have the time to battle it. Because in the end, what I’ve learned is you’ve just got to prove it over and over and over.”

            Lazaridis is right and Lazaridis is wrong about RIM’s problem.

            He is right because RIM, the maker of the BlackBerry, has been on a roll. It wasn’t nicknamed the BarakBerry for nothing. From the President in the White House to business people around the world, BlackBerry is the preferred phone.

            During the last fiscal year, Research In Motion shipped a record 52.3 million phones, a 43 percent increase over the previous year. And RIM’s fourth quarter income of $924 million exceeded forecasts.

            He is wrong because RIM has made many marketing mistakes. If you have to prove anything over and over again, you are doing something wrong. Repeating the same thing over and over again and expecting a different result is the definition of insanity. And RIM’s recent marketing moves have been insane.

            What is RIM doing wrong? Why don’t people appreciate RIM’s BlackBerry brand, profits or growth? Because they are fighting the wrong battle. They are focused on the wrong target. BlackBerry has been chasing the consumer instead of chasing its less-sexy business customer.

            Why it is that companies that have great success and profits with business clients feel the need to ditch them for the fickle, finicky and thin-margined consumer?

            Dell has been making the very same mistake for years. Instead of staying focused on businesses, they continue to spend time and money chasing consumers. Consumers who will never think Dell is cool.

            Cisco learned the consumer lesson the hard way, too. After buying Flip cameras for $590 million in an attempt to be cool, they are shutting Flip down. It didn’t work, Flip didn’t make Cisco cool, nor did it make them much money. Compared to enterprise networking systems the Flip profits likely looked too slim to make it worth continuing.

            The reality is the business market isn’t cool or sexy, but it can be extremely profitable. Just ask Cisco. The business market also works very differently than the consumer market. Consumers are less loyal and always looking for the next new thing. Business users are extremely loyal and like to keep the same product or software for as long as possible, sometimes even if it is inferior.

            BlackBerry has been chasing consumers with an array of new phones with touch screens and other flashy features. New, different and flashy is exactly what business consumers don’t want. Flashy and sexy turns off business buyers.

            Not to mention that fighting the sexy war is a losing battle. If BlackBerry is going to compete on beauty, Apple is going to win every time.

            You can’t beat or even compete with Apple on the cool “it” factor. The only way to succeed is to avoid Apple and do the opposite by stayed focused on your core customers.

            For BlackBerry, the core customers are corporate users that value security above almost all else. Consumers who post every dumb photo of themselves online could obviously care less about security. But every company does. And with more and more business communication taking place via phone and email, security is going to get even more important.

            But if RIM wants to get credit for BlackBerry’s successes and wants to continue to thrive in the future, it needs to refocus on security and business. If they let their brand erode too much longer, they risk losing their leadership as well as their luster the way Dell did.

            No business could take a $50 million Dell contract seriously after they launched the “Dude, you got a Dell” commercials. BlackBerry is in the process of making the same mistake.

            There are some other fundamental issues with RIM’s marketing that are problematic:

1.    Why the double-naming?
Research In Motion is a long and meaningless name. And it usually gets shortened to the even worse-sounding “RIM.” The company would be better off just calling itself “BlackBerry.”

2.    Where is the powerful visual?
Apple has the “Apple.” Android now has the “Robot.” Blackberry has some weird dots that nobody understands or even uses. Never underestimate the power of a visual.

3.    Why not focus on three aspects of its core market?
Business. Security. Email. It doesn’t mean RIM can’t sell anything to consumers. It doesn’t mean RIM can’t add cool features like cameras or touch screens. It doesn’t mean RIM can’t launch a tablet. But it does mean that anything RIM does should be tailored to what the business customer wants and needs.

 

            All brands need to stay focused on the battles they can win. Not the ones they can’t. RIM needs to forget about being cool. Ugly can be great and very profitable.

 

 

Super Bowl 2011: Game scores big, Advertising mostly fumbles

The stand out star of last night’s Super Bowl was clearly Aaron Rogers. Most people will be talking about Aaron and the Packers today instead of the commercials. Because it was the game that was far more super than any of the ads. But with the most-watched commercials of the year, the Super Bowl provides a good picture of the state of the advertising industry.

Here is my roundup of who scored and who fumbled.

Touch-downs

BMW: “Advanced Diesel – Changes.” Good commercials use good visuals. And nothing beats seeing the ultimate driving machine on the road. Unfortunately, diesel engines connote strong images of “smog,” so BMW brilliantly counteracts that concept with the song “Changes” to introduce us to the new advanced diesel cars from BMW.

Doritos: “Best Part.” Again, Doritos has a strong visual to work with: Its unique triangle covered in orange goodness. Everybody knows how the chips stain your fingers and how the crumbs stain your clothes, so the guy licking his co-workers fingers was the perfect twist. The twist really hammers in the brand strategy. Viewer-created commercials like this one have got to make Madison Ave nervous.

 

First downs

Pepsi Max: “First Date.” What men are thinking vs. what women are thinking is a simple idea brilliantly executed. Again, this viewer-created ad shows that big budgets aren’t necessary for a super Super Bowl ad. The key is a powerful idea. It also makes me think that a lot of talented creative people are out of work and submitting ads. “Zero Calories, Maximum-Pepsi Taste” is the closing slogan. “Zero” is nice, but it’s too bad Coca-Cola grabbed it first. The other problem is that half the commercial goes by without the viewer knowing exactly what the commercial is for? That’s a problem. The guy could have just as easily been distracted by a beer, a car or a Snickers bar.

E*Trade: “Baby -- Tailor.” What I love about these E*Trade ads is that they are in the game every year and stick to one visual that hammers their brand idea. “The site that is so easy a baby can do it.” However, this wasn’t my favorite execution. I much prefer the iPad/dog commercial that has been running the past few months.

Volkswagen: “Darth Vader.” As a parent, the Darth Vader spot pulled at my heartstrings. As a piece of work, it was brilliant. It beautifully captured the innocence of childhood. What it didn’t do, however, was to connect the idea to Volkswagen. Any car with a remote start could have been slotted in.

Volkswagen: “Beetle.” I loved it. I would have loved it more, if I knew up front the beetle was suppose to be a “Beetle.” The arrival of a new Beetle car is a big deal, so they should have showed the new car. That would have also made news and increased the chatter about the ad.

Audi: ”Release the Hounds.” Well, at least they didn’t release any more dead horse heads: Audi ads have come a long way since. They now have come up with the idea of a luxury car for a new generation. The visuals (Kenny G, the hounds) were hysterical. The only problem is that consumers don’t necessarily buy the idea of Audi being more prestigious or cooler than Mercedes. First, they need to establish the prestige of the brand before they run ads like one.

 

Fumbles:

Pepsi Max : “Torpedo Cooler.” Not every viewer-generated ad was brilliant, including this one. The commercial relies on the classic joke of hitting the guy in the crotch. Funny, sure. But the idea has nothing to do with Pepsi.

BMW X3: ”Defying Logic.” I think it is great that BMW is building cars in America. I think it is great that they are designing the cars in America, too. But they shouldn’t throw out their German roots. The brand is German and most of the profits are going back to Germany. I think that people buy BMWs not because they are made in the U.S., but in spite the fact they are made in the U.S. I think they should have spent more time showing off the new car.

Sealy: “Super Bowl After Glow.” Since I was watching the game with my 8-year-old son, I wanted to immediately change the channel for this one. Advertisers need to remember the Super Bowl is a family event as well as an adult one. The other problem with the commercial is that viewers have no idea what the company is selling. I certainly would have never guessed it was mattresses! They might have started off with the line “It’s better on springs.” I like the idea of being the opposite. Bouncy springs vs. memory foam. However, Sealy has been trying to tell us springs aren’t bouncy, haven’t they?

Anheuser-Busch: All of them. How the mighty have fallen. For years A-B seemed to have a system for creating a stable of funny, talk-of-the-party Super Bowl ads, along with a killer visual, the Clydesdales. This year, the ads weren’t funny and the Clydesdales were relegated to a bit part.

Stella-Artois: “Crying Jean.” This ad made me cry for the brand. Absolutely horrible. Again, the brand has an iconic image, the Stella glass. They showed the glass but connected it to crying ladies and a moody, pathetic-looking singer.

GoDaddy: “New Girl.” The twist of using Joan Rivers was funny. But their sexist shtick is worn out. The site is very effective, the advertising is not. They are lucky because they face no real competition in the category.

Groupon: “Tibet.” We can chalk it up as a rookie mistake to run a shocking and disturbing commercial without much redeeming value. After the intense excitement about the company and a pending IPO, this was a big PR black eye. The first part of the commercial showing Tibet and the needs of its people was poignant, but then to make a joke of it and your company, not savvy. Groupon has a problem when creating an commercial since they don’t have a strong visual to work with. What they are known for are their email messages. It’s harder to advertise a service that is unseen. The most successful service-company commercials first develop a powerful visual like the Aflac duck, the Geiko gecko and the E*Trade baby.

Snickers: “Logging.” It is hard to follow-up on the commercial that brought back the beloved Betty White. It was a classic, Betty White getting tackled on a muddy football field. It was fitting and shocking. This year Snickers substituted Lewis & Rosanne Barr. Nobody wants these celebrities back, and who even remembers Lewis? And getting hit with a log, not funny.

Chevrolet: “Old-Age Home.” Funny! Very funny. But the spot never got the brand message across. Could have been a commercial for anything. Chevrolet ran several spots during the game. Each was totally different, each was a one-off joke. So typical of GM; they spend a ton of money but they never get an message or idea into the mind.

Chrysler: “Eminem movie.” Chrysler is going to need a lot more than Eminem to save the company. The commercial was powerful in showing the images of Detroit and using its hometown hero Eminem. But I’m not sold that Detroit will ever come back to past glory. It is sad. Chrysler and “imported luxury from Detroit” are just not an easy sell. Chrysler should have started with what it already owns, the Minivans. (For Ford, it’s trucks.) What also watered down this ad is that Eminem also appeared as a cartoon in a dreadfully-awful Brisk ice-tea ad.

Motorola Mobility: “Empower the People.” If you want to compare yourself to Apple’s 1984 Macintosh commercial, you’d better be able to walk the walk and not just talk the talk. The Xoom tablet? I’d rather see them hammer the success of the Motorola Droid, an Android phone has been the much talked about alternative to the iPhone.

 

Redesigning a Brand

    So you want to start a business? You’ve got an idea, you see an opportunity in marketplace and you plan to work hard in building your business, but where do you start?

    You start by building a brand.

    There are lots of ideas and opportunities and people who work hard, but few ever become truly successful because they don’t know how to build a brand.

    So how do you build a brand? You need to do three things: get focused, be first and become famous.

    You need a focus in order to stand for something in the mind.

    You need to be first in order to establish authenticity and hopefully create a new category.

    And in the long run, you need to become famous because PR is what builds brands. Since a brand can’t talk, you’ll need a spokesperson get the message out via traditional media, social media and word of mouth.

    Build a brand still isn’t going to be easy. You’ll also need some tools to get your brand in the mind. You’ll need the right name, the right verbal strategy (a nail) and the right visual (a hammer) to drive that nail into the mind of the consumer.

    May sound gruesome, but in today’s tough and competitive climate brute force is needed. Nobody said branding wasn’t messy.

    Recently, my friend Audrey who is a personal trainer decided to make a change in her life. She wanted to start a new business.

    She had always been gifted at helping people decorate and organize. Unlike your stereotypical “decorator,” Audrey is very practical and thrifty. With the tight economy, she thought there might be great opportunity for her idea. To be the opposite of a high-end decorator who goes out and spends thousands of your dollars buying stuff to make your house look great. Audrey’s idea was to take exactly what consumers have and simply reorganize, restyle and reduce the clutter in order to redesign their homes to make them fantastic.

    Audrey has a great idea and she also sees a great opportunity, but she still needs to build the brand.

    Audrey got some pro-bono help from a friend. Here is what he suggested for her brand:

        The brand name: Simple Redesign

        The verbal nail: Restyle, Reuse, Reduce

        The visual hammer:

        The website: SimpleRoomRedesign.com

     I wasn’t impressed. So I decided to give Audrey my advice and I thought you might be interested in reading about it.

    In theory, generic names like Simple Redesign sound like a great idea. They tell prospects exactly what it is your business does. And they give the illusion your company is bigger than perhaps it is.

    At the beginning of the 20^th century, generic names were all the rage. When most businesses were small and local, the advantage was in being the opposite: big and national.

    At that time, brands like General Electric, General Mills and Standard Oil stood out. The problem is that over time, as lots of people jumped on the generic bandwagon and most companies were national, the advantage was gone. You can't build a company with a name like GE now.

    Today, launching a brand with a generic name is a killer. There are just too many brands in the marketplace. A generic name gives your brand little protection or power.

    Look at the word “Natural.” There is a big trend towards more natural products and foods. But using the generic word “natural” in your name doesn’t work. There are too many brands with similar names and so none of them stand out.

    The same is true with a generic word like “Simple.” On the other hand, “Redesign” is a nice word for Audrey’s business. It implies the restyle, reuse, reduce concept.

    The final misfortune of Audrey’s initial branding effort was that the website and name didn’t even match. SimpleRedesign.com was taken so she had to use SimpleRoomRedesign.com  

    Big mistake. If you can’t get the url, you shouldn’t use the name. These days, checking with GoDaddy.com has become a regular part of our naming sessions.

    Instead of a generic name like Simple Redesign, what could Audrey use as a brand name?

    The strategy of personalizing a brand has a lot of advantages. It leads to a proper name and has the spokesperson built right in. Think Papa John’s, Forbes, Ralph Lauren, Dell and Charles Schwab to name a few.

    Audrey is a terrific and perfect name to use for a brand. It is usual yet easy to spell. So I suggested changing the name to Audrey Redesigns.

    Luckily when you have an unusual name the chances of getting the url increase dramatically. AudreyResdesigns.com was available.

    The verbal nail Audrey was working with was really nice. I love “restyle, reuse, reduce.” It is repetitive and reinforces the concept of Redesigning instead of just interior designing.

    But no verbal nail will get into the mind without a good visual hammer to drive it in with. A hammer is a key marketing element missing from many programs. For Audrey, her original “leaf” hammer was pretty but had no relation to her brand or her category.

     So if the idea is “Redesigning,” the idea of recycling comes to mind. The visual everybody associates with recycling are the three green arrows that indicate recycling.

      Now that was a perfect visual hammer for Audrey’s brand. So I redesigned the three arrows to simplify them and make them fit her brand name .

    The result is a logotype with a strong visual hammer that reinforces Audrey’s memorable “restyle, reuse, reduce” verbal nail.

Starbucks dumps “Coffee” and I think is likely to get burned

    Change can be good and many times change can be welcomed. Change is so powerful a concept that the word itself put Obama in the White House.

    But when it comes to branding, the best kind of change is usually no change at all. Sure, over the decades a brand needs subtle, almost unperceivable, changes to keep the brand current and fresh. But radical changes by well-known brands is most often a bad idea.

    Just ask The Gap or Tropicana.

    Today, Starbucks unveiled a new logo which drops its name “Starbucks” as well as the word it owns in the mind “Coffee.” What is left is a large green Mermaid.

    Smart move? I think not.

    Is the Mermaid the first thing you think of when you think of Starbucks? No.

    Is a Mermaid a powerful visual for a coffee brand? No.

    That’s why the Mermaid isn’t top of mind for Starbucks. It is a unique visual which is good, but it is not very powerful since it has no clear relation to the brand.

    Powerful visuals like the golden arches for McDonald’s, the cowboy for Marlboro and the chili pepper for Chili’s all have clear connections to the brands and their positions.

    Is the Mermaid simple? No.

    Powerful visuals should also be very simple in design. Over the years, Starbucks has done a good job of making simplifying its Mermaid. But it is still far more complex than visuals like the Nike swoosh, the Mercedes tri-star or Apple’s apple.

    But what is really troubling about the change is the explanation Chief Executive Howard Schultz gave: “Even though we have been and always will be a coffee company and retailer, it’s possible we’ll have other products with our name on it and no coffee in it.”

    No coffee in it? Is that a good idea for Starbucks? Apparently one of the reasons Starbucks took the word “coffee” off the logo is that they want to launch stuff that has nothing to do with coffee. This is a fundamental marketing mistake. A strong brand is focused and owns a word or category in the mind.

    The Starbucks brand was built on coffee and nobody knows that better than Howard Schultz. Seeing him so blatantly and arrogantly remove it from the logo is blasphemous.

    And not because Starbucks shouldn’t launch non-coffee products. Starbucks today is big enough that it can and probably should be thinking of launching non-coffee products.

    But not with the Starbucks name. They should think like Toyota and launch brands like Lexus, Prius and Scion.

    Instead, Starbucks seems to be planning line-extensions that will dilute the brand in consumers’ minds. And nothing is worse that a watery cup of Joe.

    Starbucks is also following the dangerous trend of removing names from logos and signs. While visuals are powerful, the reality is that they are much more powerful with the words attached. Remember when Prince changed his name to a symbol only? Bad idea. Other examples include Chili's restaurant using just a chili pepper to Shell gas stations using only the shell.

 

    The combination of the visual with the name of the brand is more powerful than the visual alone. Companies should never give up the chance to hammer the name along with the image. Only on rare occasions, for simplicity and fashion reasons, should a brand use a visual only. For example, Nike’s swoosh on a shirt or Apple’s shinning apple on a laptop.

    Conventional thinking suggests that words are really not necessary. A typical comment: “The Mermaid is visual shorthand for 'coffee' much like the swoosh is visual shorthand for sports apparel."

    True. But what about the younger generation? Removing the brand name from a logotype makes it more difficult for kids growing up to learn what the visual stands for.

    In some ways, it’s like saying a well-known brand doesn’t need to advertise because “everybody knows what the brand stands for.” But over time, memories decay and without constant reminders even a well-known brand will lose some of its identity.

    Will dropping “Starbucks Coffee” from the logotype hurt the brand tomorrow?

    Probably not. But marketing strategies are not designed for the short term. They’re designed for the long term.

     And in the long term, the Starbucks brand is likely to get burned.