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The role of brand in the new marketing

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16th Jun 2003
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In a comment on a recent editorial, Why marketing doesn’t work any more – a definitive answer, I promised to try and address the role of brand in the ‘new marketing’. This week I bumped into Vladimir Dimitroff of Round, and he gave me a précis of Don Pepper’s answer to a similar question – What is the role of brand in one-one marketing? Don responded by saying that brand offered a similar relationship to that which his sixteen year old daughter had with Leonardo DiCaprio. She definitely had a relationship with him, but it was less clear whether he was aware of the relationship he had with her.

Well that quote looked like a good start to an editorial, so here we are. I’ve always felt pretty uncomfortable about what branding meant, so I’ve done some background reading. Most of that reading has been of Kellogg on Marketing (my current flavour-of-the month book on marketing), though I also got some very useful stuff from Alan Mitchell’s Right Side Up. And of course, the CRM-Forum has a useful document library, and I found the following documents we’ve published useful: Exploring the Links between Brand Name and Consumer Identity, CRM and Brand Management - Do They Fit together?, and CRM and the Brand.

By the way, despite all the reading, I’m still feeling pretty uncomfortable. Branding seems a pretty soft subject, and this editorial suffers from a distinct lack of hard data. An example of softness, almost fit for Private Eye’s Pseuds Corner follows:

‘Branding is an act of “creative destruction” that changes the meaning of relatively more stable products as the lives of consumers change with time. The more things change, the more they stay the same. It is the meaning that is different.’ - Kellogg on Marketing, Iacobucci, Dawn and Kotler, Philip - John Wiley & Sons, SKU:0471054046 - © 1999-2001, Adobe Systems Incorporated.

Despite this softness, I’m going to persevere. I’m not at all sure if I’m talking a load of old rubbish in this essay, but hope you will point out the error of my ways, and also point me in the right direction. So what have I learnt from all that reading? Let’s start with branding from the consumer’s perspective.

Nearly everyone seems to agree that the meaning of the brand is inside peoples’ heads, though of course companies try to influence what gets in there. A brand is a symbol, and a symbol means whatever people choose to make it mean, and that changes over time. The brand is an image in your head, formed through advertising, influences from other people, our experience of the company when selecting goods and services, using them, and our experience of customer service.

What do we use these brand images for? Well here there seems to be a bit of muddle. I’ve tried to come up with my own list of how I use brands:

  • Firstly, the classic use by consumers of the brand images in their heads is to simplify the product/service purchase decision. I’m thirsty. I want a sweet, non-fattening drink. “Diet Coke, please”. Of course, there are more complex decisions than that. I want to have the latest sexy high-tech gizmo, but don’t want to spend a lot of time analysing the alternatives in the marketplace, so let’s have a look at what Sony have to offer.
  • Secondly, and closely related to the first, we use brands to bolster our self-image. I used to drive a Saab (sensible Scandinavian car, but not so boring as a Volvo), and now I drive a Smart car (small, fuel-efficient, relatively environment-friendly, does the job, and just a little bit smart). When I drive around in my Saab or Smart, I’m saying a little about who and what I am.
  • Thirdly, and closely related to the second, brands can be part of fashion. Some people insist on wearing Gucci shoes, Louis Vuitton luggage, Rolex watches, Levi jeans, Nike trainers, and the rest. We even put the label on the outside to make sure people know what we’re wearing. Of course, these choices bolster my self-image, but they also have some of the characteristics of a uniform. They make me a member of a group. Those of us that drive Smart cars flash lights at each other, or peep our horns, and we may even talk to each other if we meet in a café, restaurant, or pub.
  • Lastly, we seem increasingly to be using brands to provide a sense of community. Supporting Manchester United makes us a member of their fan club. An interest in David Beckham, Madonna, or even Leonardo DiCaprio, makes us feel as if we know them as individuals. Watching Friends or Cheers, or reality-TV shows like Big Brother provides us with the gossip and interest in others’ lives we might have got from the traditional community we would have lived in.

So, from a consumer-perspective, brand seems to be about simplifying product / service purchases, bolstering self-image, fashion, and meeting some of the functions of membership of a community.

But how do companies use branding? The best summary I came across in my reading came from Kellogg on Marketing – Chapter 2: Brand Positioning. The chapter recommends that any Brand Positioning statement should answer four questions:

  • Who should be targeted for brand use?
  • What goal does the brand allow the target to achieve?
  • Why should the brand be chosen over other alternatives in the target set?
  • How will choosing the brand help the target to achieve the goal?

An example may make this clearer:

“BIC Disposable Razor: To men and women who lead active lives that sometimes result in shaving away from home, the BIC disposable razor offers you greater convenience than other razors because it is inexpensive and widely available. With the BIC disposable razor, you can focus on the things you want to do and not on keeping track of your razor.” - Kellogg on Marketing, Iacobucci, Dawn and Kotler, Philip - John Wiley & Sons, SKU:0471054046 - © 1999-2001, Adobe Systems Incorporated

So we’ve now got a tentative idea of what brand is, from a consumer and a corporate perspective. How will it be affected by the ‘new marketing’?

Let’s remind ourselves of how the marketplace is changing. The latest version of our detailed views on this can be found in Why marketing doesn’t work anymore – a definitive version. The major trends we identified there can be summarised as:

  • Marketing is moving from push to pull. In the future, buyers will initiate commercial transactions and refuse to accept marketing-initiated communications.
  • Price transparency: Buyers will be able to compare prices across all suppliers instantaneously, and understand how much profit each company is making out of their purchase.
  • Buyers will insist on solutions to problems rather purchasing products, and the ‘federation’ of suppliers that involves.
  • Perhaps for many developed-world citizens, the things that bring meaning in their lives are moving up Maslow’s hierarchy of needs from physiological / safety needs to esteem and self-actualisation. Meeting such needs doesn’t involve much consumption of material goods or services.

So what impact will these trends have on branding, from a customer and a corporate perspective? The following seems to make some sort of sense:

  • Firstly, will branding disappear? This seems unlikely, as it forms in people’s heads. However, how it is formed in those heads is likely to change. It is likely to become harder and harder to influence that image through advertising, as media continue to proliferate, and consumers continue to switch off to ‘push’ advertising and marketing messages
  • So how will brand images be formed? Word-of-mouth and customer experience of the brand, during purchase, usage, and service are likely to become more and more important. Does this also mean that the brand image is more likely to accurately reflect the reality of the brand, and so strengthen it further?
  • Although brands will continue to exist, their influence on customers is likely to reduce, due to at least the following two factors. The internet ‘democratises’ information. Whereas historically companies had for more information about the market than consumers, the internet provides consumers with simple access to information on competitive offerings and pricings. The move to price transparency, encouraged by government regulation and consumer demand, makes it still easier for consumers to compare offers. These two trends make it much easier for consumers to make informed decisions for ‘important’ purchase decisions, leaving ‘less-important’ (in the consumer’s view) decisions to the short-cut of brand. The rise of the internet and the move to price transparency ‘equalises’ the information available on both sides of the market, and so more and more ‘important’ purchases (price, significant to customer, others??) will be made by consumers by informed choice, rather than through the ‘short-cut’ of brand, so reducing the influence of brand on the consumer.
  • As the world we live in gets more and more complicated, consumers are focusing much more on meeting their goals, rather than the purchase of specific goods and services. This is likely to lead to an increasing emphasis on goals in branding, and how particular goods and services can meet those goals. As many goals may require goods and services from multiple suppliers, we may see ‘Intermediary Brands’ packaging goods and services, much as Package Holiday suppliers, have replaced the end-service delivery suppliers (e.g. hotels, airlines, etc). I’m on a ‘Simply Turkey’ flight to a ‘Simply Turkey’ hotel, rather than a BMI flight to stay at the Oyku Pansiyon in Bodrum.

One final thought: Consumers are becoming more sophisticated, and their attitudes to companies and brands will continue to develop, so we need to expect the unexpected. As E.F. Schumacher pointed out in A guide for the perplexed it may take 100 years or more for the implication of major conceptual changes to work through society. For example, the ideas of Freud, Marx, and Darwin on society are still working through their impact on our society. Could a similar time period be required for consumers in the marketplace to respond to the dominance of mass-production corporations? Increasingly, corporations express concern at the lack of trust consumers have for them. Could it be that consumers have realized that they need to treat their relationships with large organizations differently from the corner-shops of old?

As always we’d like to hear your comments. With the topic of this particular editorial, I’m sure there are many additional points to be made. Please increase the value of these starting points by making them below or email me at [email protected]

Regards,

Richard Forsyth

Replies (21)

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By r.forsyth
17th Jun 2003 08:14

I know how difficult it is for so many business people to understand and get their arms around the concept of branding. There are too many inaccurate definitions and false understandings about branding. It's easier to worry about the impact of short term sales (tangible) than to take on the challenge of building a long term brand position (intangible).
Long-term, sustainable competitive advantage is what nearly every company wants and it can only be achieved through brand positioning. Most just don't understand how to achieve it. Branding is not dead, its never been more necessary. It's just grossly misunderstood. I believe that in many industries, it's innovation that's dead. Here are a few interesting facts for you that come straight from Starbucks:

Branding Coffee
(A large commodity that had been devoid of meaningful innovation.)

Starbucks reinvented a nine hundred year old product category.
The objective: Develop Starbucks into a world class brand.
The core brand position: was less about a great cup of coffee than a great coffee experience. To move beyond the physical domain of the product to the Starbucks experience.
The Result: A deeper relationship with customers.
Fact: A tall non fat latte costs ten times more than a cup of restaurant coffee.
Fact: As of 5/02- Starbucks = 30%earnings growth over eight consistent quarters.
Fact: 20-25% earnings growth rate projected over the next 3-5 yrs by Wall Street. Starbucks = 31% growth rate in 2002.
Fact: 6,400 stores worldwide. The visionŠ 25,000 stores worldwide.


Regards,
Marc Romano

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 19:41

A thought:

The first social skill we learn and exhibit by the age of 6 months is "identity." We learn the difference between family members and others, so a 7 month old child will cry if a stranger picks it up. So our most primal
recognizing skill is "identifying."

We understand all companies, all forms, all programs as "identities."

Best wishes,
David Bell

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 12:28

Richard

Like you I have the same difficulty with the concept of brand and its interaction with other marketing factors. I always find that when discussing the subject I descend into consultant/MBA speak which a sure sign of uncertainty. I think Einstein’s statement that you only really understand Special Relativity when you can explain it to a non-mathematical member of the general public also applies to branding, let alone the interaction of branding and CRM.

How about this as a simple example.

Google understands brand building:
The company has spent virtually no money on advertising, yet Interbrand’s BrandChannel.com voted it the brand of year, displacing last year’s winner, Apple and beating Coke and Starbucks. According to research from the branding consultancy Brand Keys, Google has the highest brand loyalty of any online company. To achieve its premier position it had to displace Yahoo!, a company that was thought to have an impregnable lead as the market’s top search facility. It has done all of this in a viscously anti-technology environment whilst creating a company estimated to be worth around $1 Billion.

So what is Google’s secret? I am sure there are many explanations but these brand related factors stand out for me.

Keep things very, very, very simple and focused. The Google home page contains 32 items of text, including all of the navigation. It core brand value is to be the world’s best search web site, nothing more nothing less. It allows nothing to deflect it from this goal.

Know what your customer want and give it to them. The company’s site has equal appeal to the novice and the most experienced Web user. This does not come about by accident but results from clarity of vision about the needs of the customer and continually innovating to meet their requirements.

Get others to promote your name. Google has actively encouraged other companies to incorporate its search facilities in their own sites. This is driven by a belief that when people use your services they become brand advocates.

Everything coveys your brand values. On March 6 the Google logo had changed into a stone sculpture with the letter ‘L’ being replaced by the Michelangelo’s Statue of David in celebration of sculptor’s birthday. On Valentine’s Day it had changed again with the two ‘Os’ being placed with interlocking hearts. Today it is a convoluted ‘OO’ to celebrate Escher’s birthday. The continual adaptation of the logo is a perfect demonstration of the company’s ‘serious but fun’ image.

If you want a more detailed explanation have a look at ‘There is something about Google’ www.wnim.com/issue18/pages/google.htm

Regards

[***] Stroud

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 11:34

Richard,

I was interested in your discussion of brands in your new customer-centric marketing.

A few comments:

Your core changes in marketing tend to reflect the situation in business-2-business markets and less the situation in consumer type
markets.

To take each point in turn:

Push to Pull: Works perfectly in B2B markets where the buyer knows what they want. In consumer markets, purchasers "know what they want when they see it" (ever been out clothes shopping with anyone?). There is a cost involved in a pull market and that's in having the expertise to know what you want and whether you can afford it. Businesses employ
professionals to specify purchases. In consumer markets people don't have the time in general except in a small number of specific interest
areas.

Price transparency: Again far simpler with expert purchasers. For non-expert purchasers and when buying from a new supplier there is a
quality/risk trade-off against price. There are also transaction costs and consumers will often pay a significant premium for convenience - even for big purchases. If you check around your local shops for the
price of a bottle of Coke you will see that it has highly variable pricing even within a small geographic area.

Solutions vs problems. This is a perennial claim of suppliers in commodity markets and again is more true in B2B markets. In consumer
markets, service costs can be extremely high - a plumber might charge £50/hour to fix a 50p washer. The guys who will win here will be those who can productise service so that service costs become a minimal component of the end price and who can therefore deliver service quickly and efficiently. This leads to "good-enough" answers, rather than solutions. Examples: Supermarkets, Insurance markets and lots of others that are moving to DIY models.

Now between the "good-enough" solutions and the inexpert/time and cash constrained purchasers, sits the brand. The brand says this product is good-enough and because its brand-X, you can trust it and typically Brand-X is cheaper than a fully custom solution, but more expensive than a unknown solution. It's a low-risk lower-price purchase with a delivery
promise.

(Continued in next comment)

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avatar
By r.forsyth
17th Jun 2003 11:34

Richard,

I was interested in your discussion of brands in your new customer-centric marketing.

A few comments:

Your core changes in marketing tend to reflect the situation in business-2-business markets and less the situation in consumer type
markets.

To take each point in turn:

Push to Pull: Works perfectly in B2B markets where the buyer knows what they want. In consumer markets, purchasers "know what they want when they see it" (ever been out clothes shopping with anyone?). There is a cost involved in a pull market and that's in having the expertise to know what you want and whether you can afford it. Businesses employ
professionals to specify purchases. In consumer markets people don't have the time in general except in a small number of specific interest
areas.

Price transparency: Again far simpler with expert purchasers. For non-expert purchasers and when buying from a new supplier there is a
quality/risk trade-off against price. There are also transaction costs and consumers will often pay a significant premium for convenience - even for big purchases. If you check around your local shops for the
price of a bottle of Coke you will see that it has highly variable pricing even within a small geographic area.

Solutions vs problems. This is a perennial claim of suppliers in commodity markets and again is more true in B2B markets. In consumer
markets, service costs can be extremely high - a plumber might charge £50/hour to fix a 50p washer. The guys who will win here will be those who can productise service so that service costs become a minimal component of the end price and who can therefore deliver service quickly and efficiently. This leads to "good-enough" answers, rather than solutions. Examples: Supermarkets, Insurance markets and lots of others that are moving to DIY models.

Now between the "good-enough" solutions and the inexpert/time and cash constrained purchasers, sits the brand. The brand says this product is good-enough and because its brand-X, you can trust it and typically Brand-X is cheaper than a fully custom solution, but more expensive than a unknown solution. It's a low-risk lower-price purchase with a delivery
promise.

(Continued in next comment)

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 11:33

(Continued from previous comment)

Your final point of self-actualisation reflects the fact that people pay more on beliefs than they do on features, and brands build and foster beliefs. Consumers are non-expert buyers. They buy hopes and dreams as
much as functional delivery. Even where they are expert buyers they still might buy hope over performance, or because they need to be seen to aspire to a certain set of values.

If you take the financial services market as an example. Savings rates are all published in National Newspapers. You can shop around for
telephone banking deals or on the Internet, but the predominant feeling among consumers is that you look for someone you can trust first - often the same place that your parents used, and once you have selected somewhere you don't move. Trust is based on the reputation of the brand, and as the utilities industry shows, people won't switch just for a better deal.

Alternatively take the PC market place where most players have been shaken out of the market. Buyers don't buy the cheapest typically
(despite the fact that most of the components are the same), they buy the cheapest brand - Dell, HP, Toshiba. And a successful brand brings a second benefit which is scale, which means reduced costs, which gives stronger margins for more advertising. The more a brand is seen as a leader the stronger it becomes.

While consumers have less and less time for gathering, sifting and managing complex information and understanding purchase risk, brands offer convenient security. This isn't to say that existing brands can't be displaced, but at some point consumers have to believe that the replacement will take no more time to purchase and will provide the same
or better reassurance - in other words another brand.

Finally it's worth noting a brand is more about reputation than it is about promotion. All promotion and no delivery will fall flat. Dedicated brand managers out there will be able to tell you how much work they put in just maintaining brand values through distribution and delivery of the final product/service to the end customer.

Saul Dobney

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avatar
By masimasi
17th Jun 2003 09:36

Some thoughts connecting branding and CRM...

If we define few objectives for CRM
- Create and Implement business/customer strategy which create a differentiated value proposition for customers and potential customers (link to the brand!)
- Create and manage tailored product and service offerings for customers (link to the brand - executing brand promise!)
- Create and manage coherent and consistent customer experience which is executed by managing every single customer touch point in a multi-channel environment (or customer encounter) based on our brand associations/perceptions (link to the brand!)

That you are able to connect CRM and brand your mental models and ideas of branding should support holistic brand approach (Aaker, etc.). With this I mean that brand is a total customer experience of company's all customer touch points/encounters with customers and market + company's offerings in the market.

If your ideas of branding are related to product branding (brand is a product with a price premium) then connecting CRM and branding is much more difficult. Then your CRM approach is probable also very product marketing and sales based and holistic brand approach sounds very very odd.

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avatar
By r.forsyth
16th Jun 2003 20:36

Thanks for the article on branding. You seemed so uncomfortable with the subject in the beginning, I found it hard to trust the data you provided. I would suggest that you read "A New Brand World by Scott Bedbury. Scott was the marketing guy for Nike long ago and then for Starbucks. He is an authority on the subject. Perhaps the best authority on the subject. By the way, more than anything else, a brand is a psychological concept held
in the mind of the consumer.

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By r.forsyth
16th Jun 2003 20:26

I very much liked your article about the relationship between branding and CRM.

There is a textbook example of an industry where 100% of the players avoid doing CRM beyond their top 50 customers (while they each have thousands up to more than a million customers):

The equity business

All public companies treat the handful of their biggest institutional investors very individually. At the same time, they don't have true relationships with the large (and
very important) group of medium-sized institutional investors (current and potential), let alone retail investors.

Public companies communicate one way, unaware of the relationship Leo diCaprio has with them.

YEALD Research Network was founded to help public companies and financial institutions to build relationships with large groups of investors. It is based on a dedicated knowledgebase that gives each user a highly individual experience and at the same time captures all investor decision making behavior individually, in detail, in a meaningful way and in real time.

Marcel van Leeuwen
CEO
YEALD AG
http://www.yeald.biz

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By AnonymousUser
16th Jun 2003 20:24

New marketing dictates a fundamental difference in how brands are positioned. Whereas previously, brands could be condensed into an articulation of the functional (and ideally the emotional) needs the products they represent satisfy, a CRM brand has to go further.

Effective CRM involves the development of a win:win relationship between the product/service PROVIDER and the consumer, build on trust and exchange. Ideally, the relationship ought to be personalised. Conventional branding will tell you something about Diet Coke, new branding should tell you something about Coca Cola and in return Coca Cola should listen to what you have to tell it.

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By r.forsyth
16th Jun 2003 19:17

For what it's worth:

I always thought that a brand is the collection of feelings that individuals in a market has about a particular provider. It's not necessarily about colours or logos or tastes or products or services but how these are perceived by the individuals in the market.

In the P&G world all you can really do is to have a mass-market impact on these feelings through brand marketing. [I think this is what brand marketers try to do].

All that 'CRM' does is to enable you to try to do this at more of an individual level. So 'branding' should become more precise, stronger not weaker and certainly not something the carries on regardless......

John Ginn
Practise Director
Sophron Partners Ltd

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avatar
By r.forsyth
17th Jun 2003 19:41

A thought:

The first social skill we learn and exhibit by the age of 6 months is "identity." We learn the difference between family members and others, so a 7 month old child will cry if a stranger picks it up. So our most primal
recognizing skill is "identifying."

We understand all companies, all forms, all programs as "identities."

Best wishes,
David Bell

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 11:33

(Continued from previous comment)

Your final point of self-actualisation reflects the fact that people pay more on beliefs than they do on features, and brands build and foster beliefs. Consumers are non-expert buyers. They buy hopes and dreams as
much as functional delivery. Even where they are expert buyers they still might buy hope over performance, or because they need to be seen to aspire to a certain set of values.

If you take the financial services market as an example. Savings rates are all published in National Newspapers. You can shop around for
telephone banking deals or on the Internet, but the predominant feeling among consumers is that you look for someone you can trust first - often the same place that your parents used, and once you have selected somewhere you don't move. Trust is based on the reputation of the brand, and as the utilities industry shows, people won't switch just for a better deal.

Alternatively take the PC market place where most players have been shaken out of the market. Buyers don't buy the cheapest typically
(despite the fact that most of the components are the same), they buy the cheapest brand - Dell, HP, Toshiba. And a successful brand brings a second benefit which is scale, which means reduced costs, which gives stronger margins for more advertising. The more a brand is seen as a leader the stronger it becomes.

While consumers have less and less time for gathering, sifting and managing complex information and understanding purchase risk, brands offer convenient security. This isn't to say that existing brands can't be displaced, but at some point consumers have to believe that the replacement will take no more time to purchase and will provide the same
or better reassurance - in other words another brand.

Finally it's worth noting a brand is more about reputation than it is about promotion. All promotion and no delivery will fall flat. Dedicated brand managers out there will be able to tell you how much work they put in just maintaining brand values through distribution and delivery of the final product/service to the end customer.

Saul Dobney

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 08:14

I know how difficult it is for so many business people to understand and get their arms around the concept of branding. There are too many inaccurate definitions and false understandings about branding. It's easier to worry about the impact of short term sales (tangible) than to take on the challenge of building a long term brand position (intangible).
Long-term, sustainable competitive advantage is what nearly every company wants and it can only be achieved through brand positioning. Most just don't understand how to achieve it. Branding is not dead, its never been more necessary. It's just grossly misunderstood. I believe that in many industries, it's innovation that's dead. Here are a few interesting facts for you that come straight from Starbucks:

Branding Coffee
(A large commodity that had been devoid of meaningful innovation.)

Starbucks reinvented a nine hundred year old product category.
The objective: Develop Starbucks into a world class brand.
The core brand position: was less about a great cup of coffee than a great coffee experience. To move beyond the physical domain of the product to the Starbucks experience.
The Result: A deeper relationship with customers.
Fact: A tall non fat latte costs ten times more than a cup of restaurant coffee.
Fact: As of 5/02- Starbucks = 30%earnings growth over eight consistent quarters.
Fact: 20-25% earnings growth rate projected over the next 3-5 yrs by Wall Street. Starbucks = 31% growth rate in 2002.
Fact: 6,400 stores worldwide. The visionŠ 25,000 stores worldwide.


Regards,
Marc Romano

Thanks (0)
avatar
By masimasi
17th Jun 2003 09:36

Some thoughts connecting branding and CRM...

If we define few objectives for CRM
- Create and Implement business/customer strategy which create a differentiated value proposition for customers and potential customers (link to the brand!)
- Create and manage tailored product and service offerings for customers (link to the brand - executing brand promise!)
- Create and manage coherent and consistent customer experience which is executed by managing every single customer touch point in a multi-channel environment (or customer encounter) based on our brand associations/perceptions (link to the brand!)

That you are able to connect CRM and brand your mental models and ideas of branding should support holistic brand approach (Aaker, etc.). With this I mean that brand is a total customer experience of company's all customer touch points/encounters with customers and market + company's offerings in the market.

If your ideas of branding are related to product branding (brand is a product with a price premium) then connecting CRM and branding is much more difficult. Then your CRM approach is probable also very product marketing and sales based and holistic brand approach sounds very very odd.

Thanks (0)
avatar
By r.forsyth
17th Jun 2003 12:28

Richard

Like you I have the same difficulty with the concept of brand and its interaction with other marketing factors. I always find that when discussing the subject I descend into consultant/MBA speak which a sure sign of uncertainty. I think Einstein’s statement that you only really understand Special Relativity when you can explain it to a non-mathematical member of the general public also applies to branding, let alone the interaction of branding and CRM.

How about this as a simple example.

Google understands brand building:
The company has spent virtually no money on advertising, yet Interbrand’s BrandChannel.com voted it the brand of year, displacing last year’s winner, Apple and beating Coke and Starbucks. According to research from the branding consultancy Brand Keys, Google has the highest brand loyalty of any online company. To achieve its premier position it had to displace Yahoo!, a company that was thought to have an impregnable lead as the market’s top search facility. It has done all of this in a viscously anti-technology environment whilst creating a company estimated to be worth around $1 Billion.

So what is Google’s secret? I am sure there are many explanations but these brand related factors stand out for me.

Keep things very, very, very simple and focused. The Google home page contains 32 items of text, including all of the navigation. It core brand value is to be the world’s best search web site, nothing more nothing less. It allows nothing to deflect it from this goal.

Know what your customer want and give it to them. The company’s site has equal appeal to the novice and the most experienced Web user. This does not come about by accident but results from clarity of vision about the needs of the customer and continually innovating to meet their requirements.

Get others to promote your name. Google has actively encouraged other companies to incorporate its search facilities in their own sites. This is driven by a belief that when people use your services they become brand advocates.

Everything coveys your brand values. On March 6 the Google logo had changed into a stone sculpture with the letter ‘L’ being replaced by the Michelangelo’s Statue of David in celebration of sculptor’s birthday. On Valentine’s Day it had changed again with the two ‘Os’ being placed with interlocking hearts. Today it is a convoluted ‘OO’ to celebrate Escher’s birthday. The continual adaptation of the logo is a perfect demonstration of the company’s ‘serious but fun’ image.

If you want a more detailed explanation have a look at ‘There is something about Google’ www.wnim.com/issue18/pages/google.htm

Regards

[***] Stroud

Thanks (0)
avatar
By Jeremy Cox
17th Jun 2003 07:51

There are perceptions that companies would like their customers to have about them and their offerings, and then there is reality - what people really think. If firms understand the disparity between the two, it just might lead them to focus on critical capabilities which they will need to fulfill the brand promise. However smart firms will set aside this fixation on brand, figure out who they want to serve, and gain deep insights into their target market wants, needs and buying behaviours, and then if there is profit potential, develop the capabilities to win them. Where the customer needs are for 'solutions' rather than 'components' or basic products, then this will mean developing an effective value creation network with complementary partners. This is pull marketing, nothing new, but like CRM few are doing it effectively.

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avatar
By r.forsyth
16th Jun 2003 19:17

For what it's worth:

I always thought that a brand is the collection of feelings that individuals in a market has about a particular provider. It's not necessarily about colours or logos or tastes or products or services but how these are perceived by the individuals in the market.

In the P&G world all you can really do is to have a mass-market impact on these feelings through brand marketing. [I think this is what brand marketers try to do].

All that 'CRM' does is to enable you to try to do this at more of an individual level. So 'branding' should become more precise, stronger not weaker and certainly not something the carries on regardless......

John Ginn
Practise Director
Sophron Partners Ltd

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By AnonymousUser
16th Jun 2003 20:24

New marketing dictates a fundamental difference in how brands are positioned. Whereas previously, brands could be condensed into an articulation of the functional (and ideally the emotional) needs the products they represent satisfy, a CRM brand has to go further.

Effective CRM involves the development of a win:win relationship between the product/service PROVIDER and the consumer, build on trust and exchange. Ideally, the relationship ought to be personalised. Conventional branding will tell you something about Diet Coke, new branding should tell you something about Coca Cola and in return Coca Cola should listen to what you have to tell it.

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By r.forsyth
16th Jun 2003 20:26

I very much liked your article about the relationship between branding and CRM.

There is a textbook example of an industry where 100% of the players avoid doing CRM beyond their top 50 customers (while they each have thousands up to more than a million customers):

The equity business

All public companies treat the handful of their biggest institutional investors very individually. At the same time, they don't have true relationships with the large (and
very important) group of medium-sized institutional investors (current and potential), let alone retail investors.

Public companies communicate one way, unaware of the relationship Leo diCaprio has with them.

YEALD Research Network was founded to help public companies and financial institutions to build relationships with large groups of investors. It is based on a dedicated knowledgebase that gives each user a highly individual experience and at the same time captures all investor decision making behavior individually, in detail, in a meaningful way and in real time.

Marcel van Leeuwen
CEO
YEALD AG
http://www.yeald.biz

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By r.forsyth
16th Jun 2003 20:36

Thanks for the article on branding. You seemed so uncomfortable with the subject in the beginning, I found it hard to trust the data you provided. I would suggest that you read "A New Brand World by Scott Bedbury. Scott was the marketing guy for Nike long ago and then for Starbucks. He is an authority on the subject. Perhaps the best authority on the subject. By the way, more than anything else, a brand is a psychological concept held
in the mind of the consumer.

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