The Changing Role Of Brand In The Digital Economy
January 18, 2017
I spent the holidays pondering how the role of brand is changing in the midst of digital transformation.
As branding grew to prominence, important branding practitioners defined the role of brand as a decision enabler, information source and risk mitigator. Brand helped guide customers to better purchase decisions.
As we shifted into the experience economy, practitioners evolved their thinking to focus on defining the role of brand as actions that contribute to a more fulfilling experience. In fact when you look at new brands like Airbnb and Uber, the brand and the experience are one in the same. The brand simply took shape as the experience gained traction.
Lately, many thinkers postulate that the role of brand is to define the organization’s purpose. They hold that purpose driven brands are uniquely capable of forging emotional based connections with employees, b2b and b2c customers. This is especially true when building an employer brand strategy,
My sense is that brand plays all of these roles, but no one of these ladders up to the primary role for brand in the digital economy. A review of practitioner websites yielded no consensus. In fact, it led to more questions than answers. It seems that the branding world is at an inflection point with little clarity as to the path forward.
So I spent time during the holiday break speaking with everyday customers – both consumers and professionals. I wanted to understand their unvarnished views of the role brand plays in their lives.
As I imagined, brand continues to play all of these roles – decision catalyst, experience clarifier and purpose specifier. However, a new, very important primary role, emerged from these discussions.
Digital transformation gives customers new tools to develop and maintain relationships with the things that are important in their lives. With these tools, relationships transcend physical limitations of time and proximity.
The biggest shift for brands in the digital economy is the desire by customers of all types to forge real relationships with the brands in their lives. http://catalystbranding.com/blog/relationship-branding-brandings-next-chapter/ Whether it be b2b or b2c, customers are increasingly demanding active dialogues with brands throughout the purchase process and beyond.
Within this quest for active relationships, a new, very important role for brand emerges. The people I interviewed seek to “personify” the products and services they are engaging with. The most successful brands do a good job in establishing “who” the brand is in the relationship, so that customers and prospects find them more relatable and desirable.
As with human to human relationships, this is accomplished through a combination of physical attractiveness, magnetic personality and the promise of mutual value exchange.
Physical attractiveness piques and retains attention. Humans are drawn to what they find physically attractive, but attractiveness alone is not sufficient. It is simply the gateway to establishing the relationship.
Personality enhances attractiveness. It’s the magnet that draws individuals together. It establishes the basis for relatability and, holding attractiveness constant, is the prime source for differentiation. Just think of your group of friends. It’s personality that distinguishes one from another and is often the reason you’re drawn more closely to one over the others.
The promise of mutual value exchange distinguishes true relationships from simple acquaintances. People have room in their lives for few real relationships. The important ones transcend attractiveness. The “worth my time” question is ultimately answered through a relatable value proposition that speaks to real needs – both rational and emotional.
Together, these three aspects “personify” the brand to encourage the connections needed to forge relationships.
Well developed, they fulfill the central role of brand in the digital economy – to humanize the brand so that prospects and customers are encouraged to build the relationships they seek with the brands that are important to the ways they live, work and play.
Relationship Brands: Branding’s Next Chapter
October 11, 2016
As millennials become more influential than boomers, branders are quickly realizing that current practices need to be rethought to meet the demands of this transformative cohort.
Recent studies reveal that millennials are demanding brands to develop more individualized relationships http://catalystbranding.com/blog/millennials-transforming-branding/, but there’s little consensus around what that actually means for the practice of branding.
Stepping back, it’s clear to me that the answer lies in better understanding the notion of relationships.
Millennial relationships are digital based. These relationships seamlessly flow between virtual and physical worlds. Interaction is as much through text and social media tools as it is through face-to-face experiences.
In this digital world, the distinctions between people and entities blur. Millennials expect the entities they interact with to relate to them in the same fashion as the individuals in their lives.
Relationship mores shape expectations regarding behavior in the digital world as they have through history in the physical world. Examining these mores closely provides the clues needed to build the type of relationships required to fulfill millennial demand.
Trust & empathy are the foundation
As a starting point, it’s been true through time that trust and empathy provide the foundation for sustained relationships. Answering the “Can I trust you?” and “Do you get me?” questions help to breed the confidence so critical to building meaningful, long-term relationships.
Role defines strength
The difference between meaningful relationships and mere acquaintances is often determined by the role that relationship plays in our lives. The more meaningful the role, the more important the relationship. Relationship brands must understand the roles that are needed and be very clear as to the role they wish to play in the lives of their millennial customers.
Personality is an underleveraged differentiator. Think of your circle of friends. What distinguishes one from another? Often it’s personality that defines the difference. Relationship brands need to learn to use their distinctive personality as a means for standing apart.
Interaction behavior must change
Relationship mores are very clear when it comes to acceptable and unacceptable ways of interacting. Dominating conversations, talking too much, talking only about yourself and constantly interrupting are all unacceptable relationship behaviors. Yet these characterize most brand behavior in advertising, promotion and social media. Relationship brands need to transform these interaction styles.
Doing beats saying
In a good relationship, doing is more important than saying. People who promise and fail to deliver are universally derided. Relationship brands need to make delivery the priority.
Staying fresh is key
Finally, great relationships evolve through time to stay relevant in the lives of the participants. Relationship brands need to anticipate how customer needs will transform as the relationship progresses in order to stay fresh and relevant through time.
I find it amazing how often a return to fundamentals can provide the insight needed to navigate major inflection points. When it comes to my world of branding, a re-examination of the fundamentals of relationship behavior provides real insight as to what brands need to stop doing and what they need to begin doing once again in order to be right for the expectations of a significant new cohort.
Millennials demand relationship brands. This simple lens can help us discover just how to be the type of brand that will be right for them, both now and into the future.
How Millennials Are Transforming Branding
September 21, 2016
Traditional Branding On The Cusp of Disruption
Several studies reveal that traditional marketing and branding disciplines are losing their impact when it comes to serving millennials. Credibility and differentiation are no longer earned simply through what we say. Instead, they’re established by what we do and what others say about us.
How Millennials Decide
Millennials make purchase decisions in a manner uniquely theirs:
They learn as much as they can
They share with their trusted network to gather a consensus of opinion
They strive to forge a two way relationship
They demand discussion and responsiveness
They’re drawn to the authentic – those who do what they say and are true to what they promise
They’re motivated by customized “deals”
“Value” is the prime driver
The Role of Brand is Different for Millennials
The role of brand is about shaping a narrative that defines who you are in a potential relationship:
What you believe
Why you exist
What you do to deliver on this reason for being
How you do it
Personality is more critical than ever:
Personifies the brand
Humanizes the relationship
Shapes communication style – verbal and visual
Guides behavior – relating, teaching, solving, delivering
Selling is bad. Sharing and teaching are good.
Millennials seek to be better equipped to make the decision themselves. They don’t want others making the decision for them and telling them what to do.
Branding is necessary, but no longer sufficient
Millennials need to be engaged as they live. Interrupting them and forcing them to listen to you turns them off. This is one of the major reasons so many are turning away from cable to streaming content. Advertising as we know it is no longer the most effective engagement mechanism.
The new challenge is capturing their attention in the context of how they live. Giving them the information they need to teach themselves and allowing them the freedom to engage with you as they prefer through the channels they choose to use.
If you’re successful in engaging them, they will demand an active dialogue. They will expect you to shape your offer for them based upon what you’re learning in that process.
They will share intensely. If they see you as right for them, all of their friends will know about you and will be encouraged to give you a try. If, however, you turn them off, then rest assured that all in their network will know about it.
Relevance continues to be an important driver. But the definition of relevance is expanded to include both what you offer and who you are in the context of a potential relationship.
Authenticity makes or breaks a relationship. “Are you true to who you say you are?” Is the core question millennials constantly ask. This is the foundation of the new trust.
Responsiveness is also key. Do you hear me and are you willing to show me how much you’re prepared to shape your offer for me based upon what you know about me?
Branding, engagement and delivery are all one in the same for millennials. They want to form a relationship with an authentic source of value who will commit to being true to their word in promise and deed, engage with them in an active dialogue, shape their offer to meet their desires, deliver in all the ways promised and reward them for their loyalty to you.
Curing Brand Schizophrenia
January 28, 2016
Removing a Growth Inhibitor: Curing Brand Schizophrenia
For years, big players in financial services and enterprise technology have rolled up organically built and acquired businesses under a single, overarching corporate brand.
This plan made sense when originally conceived. Of the alternative models, this approach generated the greatest efficiencies, provided the most consistency, was the easiest to manage and sustain.
The advantage to this approach lies in its economics. By leveraging a single overarching brand, firms are able to concentrate their media spends and generate significant economies of scale. It’s easy to understand why it has been so widely embraced.
Unfortunately, this approach has its downside.
With limited exceptions, these roll-ups suffer from muddled market perceptions. Just look at the biggest banking and enterprise IT firm brands today. Distinctiveness is sacrificed by basing the collective positioning on a common denominator across the business. This compromises the ability of individual business units to compete effectively with more focused, relevant and agile competitors.
The resulting “brand schizophrenia” inhibits growth.
By trying to be multiple things for multiple people, these brands make it extremely difficult for customers and prospects to appreciate the relevance, credibility and value of individual competencies.
Even worse, in some cases unforeseen channel conflicts have created insurmountable barriers to growth.
In response, some forward thinking organizations have embarked on strategies to replace these “roll-up” structures with far more focused pure play models that separate unrelated competencies into distinctly branded, stand alone entities. This refined strategy fuels growth by focusing resources, clarifying market positioning and eliminating channel conflict.
Doing It Right: The IO example
IO is an innovative enterprise IT organization that faced head-on the challenges of “roll-up” structural constraints. The company built world class competencies in IT infrastructure services and IT infrastructure technology, but was increasingly frustrated by results that did not live up to forecasted market potential.
A thorough review of the challenge revealed that these two seemingly synergistic competencies were actually inhibiting growth under a single brand. Customers for the service company failed to appreciate the added value of the technology competency and because the most lucrative market for the technology was other service providers, the structure created an inherent channel conflict that completely impeded growth.
Management took the bold step of splitting the company into two distinct entities to eliminate constraints and fuel growth.
Doing it Wrong: The HP example
Confronting similar challenges, HP embarked on new strategy to distinguish its consumer technology business from its Enterprise IT organization.
Unfortunately, this well considered strategy is compromised by poor execution. The resulting new brands are too closely aligned. They share the same name and the same original visual style.
How to do it right?
If you’re going to do it, then really do it.
The key learning from reviewing HP’s mistake is that success in such an endeavor requires pushing the businesses and brands apart to create two distinct entities.
This means examining the strengths and weaknesses of each entity and building the respective brands on the basis of the strengths that are unique to each. Shared strengths will help with operational success, but for brand building purposes we need to focus on the strengths that each business owns uniquely.
Building the Brand BluePrint
If you going to do this, the key to success lies in how you frame the strategy. The goal is to define the focused brands as distinctly as possible to avoid confusion in the marketplace.
The easier this is to do, the more comfortable you can be that the separation decision is right for the business. Conversely, if you’re finding it difficult to distinguish the brands then the separation strategy is probably not the best solution for the challenge you are attempting to solve.
To build such a strategy, we employ a simple, yet effective model to shape the foundation for the brand. Our “Brand BluePrint” model starts with the business challenge and focuses the brand strategy to solve this challenge and enable opportunity.
The key components of this model include:
It’s all about crispness
In the end, the key to eliminating the constraining impact of brand schizophrenia lies in defining the individual brands a crisply as possible. This new clarity will free the businesses to compete more effectively with pure play competitors and will eliminate the hurdles of channel conflict.
Success starts with an effective strategy. If you’re going to do it, drive the brands apart as far as possible. The crispness will make it easy for targets to embrace the value.
The Power of a Refresh
October 6, 2015
I use Asana – a wonderful productivity enhancing, program management app. Asana is entrenched as part of my everyday ritual. I can’t imagine living without it.
Yet, like most other habits, my relationship with Asana is largely back of mind. The app is an important tool, but I rarely consciously think about it.
This week, Asana launched a very well done refresh, including a fresh new logo redesign. Interestingly, the net effect brought the brand front of mind for me again.
I was reminded how central Asana is to my everyday work life. I went to the blog and the website and discovered new features that are even more helpful. I learned and appreciated more than I have in the past year. The brand refresh helped renew my relationship.
My experience with Asana is very similar to that I have with Apple and other important brands. A software or hardware refresh often has the same impact. I learn more. I’m reminded of how important the brand is to my everyday life and I recommit to the brand again.
Given my ADHD, that all lasts just a few days. But, the impact is extremely powerful.
All of which leads me to believe that brands should think differently about how regularly to refresh.
Conventional wisdom suggests a five-year refresh cycle, at the minimum. I think that dated advice is no longer helpful.
Instead, I’d be looking to refresh some element of the customer experience twice yearly to keep customers actively engaged with your brand.
This doesn’t mean taking steps as dramatic as those taken by Asana. But, it does mean being much smarter and more aggressive in keeping your brand front of mind with your core marketplace.
I’d start today to craft a regular refresh plan and roadmap. Begin with an assessment of user experience needs and opportunities. Then craft a plan with logical stages – from regular clean-up to transformative regeneration. The return will more than offset the effort.