Consumer

Wayne Huezinga autonation marshall strategy

A Tribute to Wayne Huezinga

We first met Wayne Huezinga when he asked our help in creating the identity of a new venture he was starting. When we asked about the venture, he said he planned to consolidate the largest unconsolidated industry in America, used cars. He pointed out that the annual sales of used cars was equal to half the sales of new cars. He also said that the average family could no longer afford the average family new car, so they were leasing cars instead of buying them. This meant that there would be a lot of formerly leased cars on the market when the leases expired within 2-4 years, with low miles, that he could buy and sell at a great discount.

He planned very large lots, with a great range of selection. He was not going to have sales people. Instead, he would have consultants to help customers figure out what kind of car was best for their needs and what would be the best way to pay for it. He was going to have fixed prices, the same for everyone. He would give you a firm price for your trade-in whether you bought a car from him or not.

We said, “Wayne, a lot of used car lots are owned by local businessmen who you will put out of business.” He replied, “Used car dealers take advantage of buyers, especially women. They misrepresent their cars, manipulate their pricing and don’t stand behind their product. They are ranked below politicians in honesty. They deserve to be put out of business.”

We named the new business AutoNation and within four years it was the largest auto dealer in America.

So, when you go to any car dealer in the future, new or used, you can thank Wayne Huenziga for bringing transparency and integrity to the industry.

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brand strategy for a commodity

Using Brand Strategy to Differentiate a Commodity

Differentiation is critical for commodities to achieve any marketing advantage. With few exceptions, such as monopolies like the cable companies and one-of-a-kind products like Polaroid was years ago, differentiation is critical to creating a preference or commanding a premium price. If your product or service is not differentiated, there is no reason to choose yours over others, and you will wind up competing on price.

The good news is that there are many ways to differentiate commodity products and services. I used to be in the business of selling flour, shipped by trainloads from the Midwest to large, commercial bakeries on the East Coast. Trains can get delayed for a variety of reasons, so the bakeries needed to build expensive flour storage facilities on their premises for back-up. We built our own flour storage facilities in locations from which we could reach the bakeries by truck within a few hours. This gave the bakeries an assured supply on demand, and it eliminated the necessity of tying up their capital by building storage facilities. In this way, we created a preference and price advantage for our commodity.

There are many other ways to differentiate commodity, such as:

  • Risk – eliminate or reduce your customers’ potential risks.
  • Inventory – offer inventory management or convenience.
  • Financing – develop customer financing options, appeals and incentives.
  • Rewards – consider a rewards program to encourage loyalty.
  • Sustainability – appeals to customers, employees and communities.
  • Packaging – use packaging for convenience, or badging, to stand behind your commodity.
  • Ingredient – create a proprietary ingredient or concept available only in your commodity.
  • Bundle – or unbundle, your products and services.
  • Segment – your market, and tailor your marketing to the most profitable segments.
  • Experience – provide a superior purchase or usage experience: easier, faster, more flexible.
  • Consulting – become an expert in your customers’ industry and become a valued authority.
  • Facilities – showcase impressive facilities, operations and equipment as sales tools.
  • Safety – commitment to the health and safety of yours and your customers’ workforce.
  • Marketing – create appealing marketing materials and concepts.
  • Brand Strategy – build and support a compelling identity, story or promise.

Let’s talk about Brand Strategy: Gasoline is a commodity that relies on differentiated brand strategies. These strategies usually involve ingredient branding: Shell NiTRO gasoline (to protect your engine); Exxon/Mobil Synergy gasoline (Better for the environment); Chevron “With Techron” gasoline (to maximize your mileage).

Some of the most successful brand strategies have been created to differentiate a commodity. Think about Morton’s Salt, Gold Medal Flour, C&H Sugar, Sunkist Oranges. Water, once the ultimate commodity, is now a range of differentiated products aimed at different market segments and desires. Water is differentiated by its source (Fiji, Lake Geneva, Glacial Iceland, Artesian Springs) or by its character (Vitamin Water, Mineral Water, Smart Water).

With a clear brand strategy, good market data, strategic naming and design, creative communications, and resources aligned to support your goals, you can differentiate any commodity to create a preference or command a premium.

Ask Marshall About Brand Strategy for Your Business
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branding_v_marketing

Branding vs. Marketing

Sometimes our clients ask us, “What is the difference between branding and marketing?” The question arises because most people and organizations use these terms interchangeably. Unlike Medicine, Law or Finance, practitioners in the field of brand and marketing don’t share a common professional language. When one doctor says a patient is suffering from nephritis, another doctor will understand that the patient has inflammation of the kidneys. When one lawyer says he has an affidavit, another lawyer will know he has a written statement made under oath.

Ask 20 marketers what branding is, and you may get 20 different answers. To some it may mean creating a logo, to others it may mean developing an advertising or public relations campaign, to others it may mean initiating social media conversations. Because the term “branding” is used to mean so many different things, it doesn’t have a specifically agreed upon meaning. For some clients, especially higher education, we sometimes have to avoid the word altogether, because it not only misunderstood, it is looked down upon as “beneath” academics.

We make a point of telling our clients at the outset of any assignment what we mean when we use particular words, so at least, they’ll know what we are talking about. We fully recognize that others may use these words differently. We use them in this way:

A Brand – is the promise you make to your audiences. Strong brands are valuable assets, because when the promise is fulfilled, it creates an emotional response. Strong brands can create a preference or command a premium and assure a future stream of revenue. The name and visual expression of that promise is called a brand identity, because it gives you a way to identify with the promise being made.

Branding – is about positioning the brand to fill a need, meet expectations, build trust and develop relationships. It’s about keeping your promise differentiated, relevant, compelling and true.

Brand Strategy – is about determining how many brands you need and can afford to support, what each brand should stand for, and what relationships should or should not exist between the brands and the parent organization.

Marketing – is about finding and growing a market for the brand that leads to profitable sales, or in the case of non-profits, that leads to appreciation and support among key audiences.

Marketing Strategy – is guided by business goals, and involves segmenting markets, selecting target audiences, determining pricing, packaging and distribution, integrating media, and executing creative campaigns.

Consider a stand out brand like Nike. The Nike brand promise is to bring inspiration and innovation to every athlete in the world. “If you have a body, you’re an athlete” says Nike. This brand promise demands a diverse, creative attitude-laden execution across the many customer touchpoints. That is branding. Nike’s innovative use of celebrity athletes and digital, social, mobile and retail channels to engage with existing and aspirational athletes, is marketing. Nike’s marketing strategy is highly influenced by the brand promise and expression – and the resulting ads, promotions, communications and offers feel like they could come from no other sports brand.

Bottom Line: We define branding as making, communicating and delivering a promise. Branding is a long-term commitment. We define marketing as finding and connecting with the audiences who will most benefit from that promise. By its nature, marketing tends to planned out with shorter term goals. Marketing strategies and campaigns will come and go, but brands should endure. While definitions of branding and marketing may differ, it is important that people use agreed upon definitions of terms, to ensure that you meet both short and long-term objectives for your business.

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How to Turn Your Employees Into Brand Advocates

How to Turn Your Employees Into Brand Advocates

Your employees are your biggest marketing opportunity. Why? Because if they are engaged with your brand, they can be your number one marketers and boosters of brand equity. How do you convert this potential business-changing force into brand advocates? Achieving employee brand engagement was our topic at the last Silicon Valley Brand Forum.

Empowering employees as brand advocates is critical to successful brand evolution. When you change or evolve your brand identity, your internal audience is just as important as your external audience. Ideally, your employees are the engine driving brand transformation. For that reason, we ask every client to engage their employees when changing their brand identity.

Engaging your employees

To be effective, brand identity work must inspire employees as an idea they can rally behind. Quantitative research can give you data, but qualitative research helps you hear and feel culture from the key voices and the personalities who make it real. You can’t just change your logo and tell employees, “All right, everyone, fall in line and be part of this.” Your brand essence starts within your company, and employee brand advocacy requires investment, cultivation and authenticity. It also must capture your employees’ spirit and passion. If your employees are engaged, you will have a firm foundation for moving forward with change.

Four factors for empowering employees as brand advocates

A new brand identity should be both aspirational and authentic to employees. It’s essential that employees:

  1. See themselves in the new positioning
  2. Believe in the vision and aspiration behind the new identity
  3. Understand that the new brand has meaning and value
  4. Feel recognized for their part in adding value to the brand

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Ten Principles for Renaming, from Alina Wheeler’s Designing Brand Identity V | Marshall Strategy

Ten Principles for Renaming

from Designing Brand Identity, 5th Edition, by Alina Wheeler
We’re pleased to be included in the fifth edition of Designing Brand Identity, by Alina Wheeler. This comprehensive guide to brand identity is a valuable resource for designers, marketers, CEOs, brand builders and internal teams. For the new edition, we contributed a list of key principles to consider when renaming your product or a company.

Ten Principles for Renaming

by Marshall Strategy

  1. Be clear about why change is needed. You should have a compelling reason, and clear business benefits, for going through the name change process. Making a strong case for change – whether legal, market-based or other, will help rise above emotional issues and enable a more successful and meaningful effort.
  2. Assess the impact of change. A name change is more complicated than creating a new name because it affects established brand equity and all existing brand communications. You should conduct a thorough audit of equity and communication assets, to fully understand how a name change will affect your investments and operations.
  3. Know what your choices are. Depending on your reason for change, it can be very difficult to consider change in the abstract. It is much easier to commit to a change when you have alternative names to consider that solve your communication issues.
  4. Know what you are trying to say before you name it.  Naming is a highly emotional issue that can be hard to judge objectively. By first agreeing on what your new name should say, you concentrate your efforts on choosing the name that says it best.
  5. Avoid trendy names – By definition, these are names that will lose their appeal over time. Choosing a new name simply because it sounds “hip” or “cool” generally results in names that wear quickly.
  6. “Empty Vessel Names” require filling. Made-up or meaningless names will require more investment to build understanding, memorability and proper spelling than names that have some inherent meaning. Compare the immediate meaning and relevance of names like Google and Amazon to empty vessels like Kijiji and Zoosk.
  7. Avoid names that are too specific. This may be the reason you needed to change  in the first place. Names that identify a specific geography, technology or trend might be relevant for a period of time, but in the long run they could restrict your ability to grow.
  8. Understand that a new name can’t do everything. Names are powerful tools, but they do not tell the whole story. A name change alone – without rethinking of all brand communications – could risk being seen as superficial. Consider how new taglines, design, communications and other context-building tools should work with the new name to build a rich new story that you can own.
  9. Ensure you can own it. Check patent and trademark offices, common law usages, URL’s, Twitter handles and regional/cultural sensitivities before you decide, and make the investment to protect your name. This is best done by an experienced intellectual property attorney.
  10. Transition with confidence. Make sure you introduce your new name as part of a value-oriented story that conveys clear benefits to your employees, customers and shareholders. The message “we’ve changed our name” on its own generally falls flat. Commit to the change with confidence and implement as quickly and efficiently as possible. Having two names in the market at the same time is confusing to both internal and external audiences.

If you wish to make a meaningful statement, a name change is not enough. The name should represent a unique, beneficial, and sustainable story that resonates with customers, investors, and employees.

Philip Durbrow, Chairman & CEO, Marshall Strategy

Companies change their names for many reasons, but in every case, a clear rationale for change with strong business and brand benefits is critical.

Ken Pasternak, Managing Director, Marshall Strategy

Notable Renaming

Old Name

New Name

Anderson Consulting Accenture
Apple Computer Apple
Backrub Google
The Banker’s Life Company Principal Financial Group
Brad’s Drink Pepsi Cola
Ciba Geigy + Sandoz Novartis
Clear Channel iHeartRadio
Comcast (Consumer Services) Xfinity
International Business Machines IBM
Datsun Nissan
Diet Deluxe Healthy Choice
Federal Express FedEx
GMAC Financial Services Ally Financial
Graphics Group Pixar
Justin.tv twitch
Kentucky Fried Chicken KFC
Kraft Snacks Division Mondelez
Lucky Goldstar LG
Malt-O-Meal MOM Brands
Marufuku Company Nintendo
Mastercharge Mastercard
Mountain Shade Optic Nerve
MyFamily.com Ancestry
Philip Morris Altria
Service Games SEGA
ShoeSite.com Zappos
TMP Worldwide Monster Worldwide
United Telephone Company Sprint
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southwest culture

Culture Drives Brand Value – Where Will It Drive Yours?

I recently published an article in Inside Higher Ed describing five strategies of great brands, and how they apply to universities.

One of those five strategies is: brand inspires behaviors – you build a brand by being something, and letting that culture shape the way you behave and communicate. A successful brand strategy must lead to tangible behaviors, ways of thinking and acting that can differentiate you and your company in measurable ways.

Consider FedEx, Southwest Airlines, GE, and other brands that have become legendary for their corporate cultures. They all recognized the importance of defining and articulating not just their customer promises, but their internal behaviors for fulfilling those promises. Customer satisfaction and business success are the rewards that reinforce these behaviors, creating a cycle of growing brand strength.

A recent example of this is San Francisco’s own Salesforce.  Marc Benioff, Salesforce CEO, has fostered a culture of “Ohana” within the company, a set of principles that inspire everyday behaviors against which employees are evaluated. Ohana is a Hawaiian word with deep meaning, which translates very roughly as “extended family”. What it means is that all members of a family, and their greater community, support each other. This culture extends externally for Salesforce – their number one mission is “customer success.”

The emphasis on culture has major effect. Benioff recently said, “There’s all this incredible energy in your company and you can unleash it for good. All you have to do is open the door.”

With this attitude, it becomes evident why Salesforce is one of the world’s fastest growing companies, and is ranked among the “best places to work” wherever it has offices.

Compare Salesforce’s results, and the brand benefits they accrue, to recent events at United Airlines and Uber. These two companies have dominated the news cycles lately, for all the wrong reasons.  Within each story is a tale of bad behavior and poor choices, revealing crippling or even toxic corporate cultures. People who describe these woes as “PR problems” aren’t dealing with the core issue, the deep cultural flaws that threaten the very existence of these two companies.  When United loses $1Billion of market valuation in one day and Uber has over 200,000 customers deleting its app, that threat is clear and present.  These companies need to focus on their cultures at all costs, or they will lose any customer loyalty that remains.

We hope that more companies will take a close look at what promises they really want to make to their employees, customers and shareholders, and what those promises mean for how they act, speak, and treat each other – as well as their customers. Iconic, customer-centric brands like Salesforce and Southwest show strong evidence that placing a priority on building and living a positive culture results in loyal customers, healthy companies and strong brands.

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trump brand

Does Identity Trump Brand?

In reading “How Will Trump Rebuild His Brand? published through Knowledge @ Wharton, we need to think about Trump’s brand and his identity, and how both may affect his upcoming presidency.

It can be confusing when the word brand is used to mean so many different things. Brands convey a promise that people come to rely on. The Trump brand promises ornate, luxurious, exclusive products or experiences at a premium price. It attracts prosperous clientele that are drawn to these qualities and who can afford these experiences. It is an appropriate brand for up-scale products and properties, because it is very well known, and it can command a premium price. Hence the brand has value to properties not even owned by Trump, and for which some product and property owners have been willing to pay a royalty.

Identity is different from Brand. Identity is about the reality of a person or company – who he, she or it really is – where brands are externally driven to appeal to others, identity is inner-driven. Identity flows from the reality of who the person or organization is – their innate driving force. Identity is bigger than brand. The identity of a corporation, organization, individual, or even a presidency may develop several “brands” aimed at different audiences. It can be especially powerful if all the brands stem from or reinforce the identity. The identity of Proctor & Gamble is characterized by a singular drive to provide quality household products that improve people’s lives. This is their driving force, but P&G has many brands (Crest, Tide, Pampers, Gillette, etc.), all shaped to appeal to different external audiences, yet all reinforcing P&G’s identity.

Donald Trump’s identity is more multi-faceted than his luxury brand. Trump’s identity should not be confused with his luxury brand. If Donald Trump’s drive for power is sincerely about populism, uniting the country and creating prosperity for all, and if he delivers on these goals, President Trump will be recognized and appreciated for not just luxury goods and properties. To accomplish his objectives, he may need to create a healthcare brand, a tax reform brand, a foreign trade  brand, and other “brands” shaped to appeal to different audiences. And these brands should all reinforce and deliver on his drive to “Make America Great Again.” If they don’t of course, all of these brands will lose credibility along with the presidential identity.

In conclusion, it is not only possible, but necessary, that a president serve many different audiences, and good branding can help, but the Trump luxury brand alone is not enough. What matters most is Trump’s Identity, who he really is, what he truly cares about and what he aspires to accomplish.

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Bank Relationship

How would you define your Relationship with a Bank?

Timothy Sloan is replacing John Stumpf, as the new CEO of Wells Fargo, due to the bank’s inappropriate and, perhaps illegal, cross-selling practices.  In the October 13 Wall St. Journal, Sloan is quoted as saying,

“I don’t believe that strategy was fundamentally flawed. We are not abandoning our cross-selling focus. Cross-selling is shorthand for growing relationships with our customers.”

This shows a serious misunderstanding of what “relationship” means to Sloan and to the Wells Fargo organization. Only a banker would say that their relationship with their customers is based upon how many products the bank can sell them, whether they need them or not.

A relationship to most people involves some kind of human connection. A positive relationship is one in which people regard and behave toward one another with respect, understanding, and truthfulness. Strong brands are built on individual connections, not financial transactions, but most big banks seem to get this wrong. Perhaps this is why most banks typically rank very low on brand satisfaction surveys – they are focused on the wrong kind of “relationships.”

Wells Fargo and its new CEO need to give some serious thought to what is needed for the bank to truly serve its customers’ needs. They should change their focus on building the bank’s income and instead focus on how customers might define a profitable relationship. That is how we would recommend Wells Fargo make its next efforts to become appreciated, profitable, and to a grow a lasting brand.

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It Never Pays to be a Copycat

It Never Pays to be a Copycat.

A recent WSJ Article trumpeted “Copycats Rule the Skies.” It was about how the three largest U.S. airlines have all become so much alike.

Why are the Delta, American and United brands so much alike? Patrick Moynihan, the former Harvard professor and U.S. Senator had a theory called, “The Iron Law of Emulation.” His theory held that nations that competed against each other became more and more like each other. This certainly seems to be the case with our airlines, hotels, banks, etc.

Moynihan pointed out how the U.S. and Russia once emulated each other: We got the bomb, they got the bomb; we got intercontinental missiles, they got intercontinental missiles; we got nuclear submarines, they got nuclear subs, and on and on.

During my 20 years at Landor, we designed the brand and identity strategies for dozens of leading airlines. Our purpose, always, was to differentiate each airline in a way that was relevant, true and compelling. To create a preference or command a premium, we built on each airline’s unique brand characteristics which were often its national characteristics: British Air was about their understated global competence. Singapore Air was about the pride that Singaporeans take in providing personal service. Alitalia was about Italian style. Hawaiian Air was about sunshine, flowers and relaxation. These identity strategies influenced all the decisions each airline made. Whom to hire, how to train, what kind of fleet to operate, and what passenger offerings and style of operations would reinforce their particular identity.READ MORE

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Great Branding Starts with a Promise

Recently in Fast Company Design, I read an article that claims “great branding is invisible,” and goes on to make the point that the little details, like the satisfying thunk of a closing BMW door, or the stitching in a Gucci purse, create and reinforce our relationships with great brands.

The article also makes the point that a catchy tagline or attention-getting logo is relatively unimportant in establishing that brand relationship in the first place.

I agree with these observations, but there’s something missing. Thoughtful details – the “invisibles” that create great brand experiences – are only meaningful if they come from a unique and meaningful central promise. What do you aim to provide that nobody else can? Why does it matter? If you don’t have an answer to these core questions, all those details have no center of gravity. They become tactics that can be easily copied and commoditized.

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