A New Brand World Book Summary, by Scott Bedbury, Stephen Fenichell

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Brand Awareness: Marketing Pyrite

Pyrite, also known as “fool’s gold,” fooled a lot of prospectors. It looks like gold but isn’t worth nearly as much. That’s true for brands too; they look a lot more valuable than they really are and have fooled many marketing managers. Marlboro is one such brand that has had a huge impact on the market, but it was not able to sustain its success because it failed to keep improving its products/marketing strategies. On the other hand, Harley Davidson has been successful at building brand awareness while maintaining quality products and relevant marketing strategies.

Coffee is a very common drink, but Starbucks has turned it into an identity. They invest in the design of their stores and packaging to make coffee seem like something special. Most of their money goes toward marketing and making people aware that they exist.

A brand is intangible. It’s all the impressions, experiences and memories people have when they think about your product or service. Some may be good, but some may be bad as well. Think of Tylenol or the Exxon-Valdez oil spill. The product itself is secondary to what constitutes a strong brand:

  • Define the Brand’s Essence

  • In order to advance your company, use both your head and heart. Fight for the things that are important and meaningful. Make sure you have a strong team with people who complement each other’s strengths and weaknesses so you can work together effectively.

  • The brand’s values should become part of the company’s culture. The brand should be treated as if it were a child, and employees should take care of it like parents would a child.

Know Before You Grow

In 1987, Nike was in a crisis. They ignored the competitive threat posed by Reebok and said that their shoes were inferior to theirs. However, millions of consumers voted with their feet for Reebok instead of Nike’s products. This forced Nike to redefine themselves so they could reach an inflection point where they would be able to make better decisions about what kind of company they wanted to be and how it should operate after the crisis.

  1. What Measures Success?

Nike had been seen as a company that only made shoes for athletes. It was not very successful because Reebok took over the market share in America. Nike laid off many employees, and sales decreased by 25%. The situation at Nike was desperate, but it eventually found its niche with fitness wear instead of just competitive athletic wear.

The only way to satisfy all their customers was for Nike to become more inclusive and offer clothing and products for everyone. They launched a campaign that said “Just Do It” in order to get this message across.

The Problem with Brand Research

Brand research uses a lot of data to make managers realize what their gut tells them. Nike’s culture was research-averse and relied on the Brand Strength Monitor (BSM) instead. This tool measured how people felt about Nike, but not if they were aware of it or knew anything about it. The BSM broke down the market into four groups: males age 13 to 18 and ages 25 to 34, and females in those two groups. Interviews showed that young males are core customers for Nike; however, this is both good news and bad news because there is a chance that too much focus will be placed on this segment only, which could lead to problems later on with other segments as well.

In similar research at Starbucks, people did not think of coffee when they thought of the brand – they thought of experiences. The essence of their brand was not a great cup of coffee but an excellent experience with every cup. Their mantra became “Rewarding Everyday Moments.”

Brand Mantra

A slogan is not a brand mantra; it’s just a catchphrase. A brand mantra explains the true essence of the brand and helps guide its decisions. Nike’s motto was “Authentic Athletic Performance.” It helped them reject products that didn’t fit with their image, such as loafers.

Sometimes, a brand’s essence has to be rediscovered. This happened at Disney when Michael Eisner took over as CEO. Bob Lutz did it for Chrysler when he brought back the Dodge Viper, and Steve Jobs did it with Apple by bringing in the iMac – which was cool, simple, creative and irreverent. The New Beetle recaptured that whimsical essence of the old Volkswagen Beetle.

Don’t Dilute

There are three major mistakes that you can make when it comes to your brand. The first is diluting the brand by opening too many stores or trying to expand into markets where they don’t belong. That will cause your company’s image and reputation to suffer, as other companies do a better job of providing their services in those areas. Pollution occurs if you hire people who aren’t competent for certain positions within your company. Finally, not growing at all would also be a mistake because then you’d be losing out on opportunities for growth that could benefit both the employee and the customer base in general.

Starbucks’s marketing team faced a big challenge when United Airlines proposed the co-branding initiative. U.A.’s frequent fliers had complained about the quality of coffee served onboard, and wanted to woo them with Starbucks. The deal had many advantages, but Starbucks’ team worried about quality control and brand control issues. After getting guarantees for quality and various agreements that would protect their brand, they signed on to do the deal with United Airlines.

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  • Brand extensions are common. For example, Teen People was launched as a brand extension of the original People magazine. But every brand has its limits and will tear if stretched beyond them. Starbucks is now selling through specialty retailers and other channels too, but it’s important to be careful with new products or categories; for example, Sony succeeded in miniature computers but failed miserably in movies because they didn’t have the necessary knowledge or capabilities for success in that area.

  • “Sub-branding” – For example, Lexus is a brand of Toyota.

  • Chrysler bought American Motors in order to get the Jeep. Three things should be noted: First, you have to keep your eyes open and watch out for what’s going on around you because a company like Levi Strauss ignored the Gap when it was trying to reinvent itself, which was bad. Second, quality is important so don’t cut corners with your brand while cutting costs because that would hurt sales. Thirdly, each effort is unique; one success doesn’t mean that everything will succeed in the same way.

It’s Not the Product, Stupid

Harley Davidson makes great motorcycles, but the brand focuses on how it makes people feel. People tattoo the logo on their bodies and create groups to share their love of Harley-Davidson’s bikes. The brand is so strong that people are willing to do this; however, in the 1980s, Harley-Davidson was struggling because Japanese imports were taking away its customers. In order for a company to be successful, it needs loyal customers who will buy its products no matter what happens. This is true for any business—if you have loyal customers who like your product or service enough that they’re willing to buy from you even if there are cheaper options available elsewhere, then you’ll be more likely to succeed than if your products aren’t as good as those offered by competitors and/or if there isn’t much demand for them at all. Therefore, one of the smartest things Harley Davidson did was recognize that its image needed changing and focus on making itself into a desirable brand instead of an undesirable one (i.e., an outlaw biker gang). It limited production in order make sure that only certain people could get hold of Harleys rather than everyone being able to afford them; therefore, only special people would own these motorcycles and not just anyone could ride around with one which made owning a Harley almost exclusive.

Guinness is a good beer, but it’s not about the beer. The company wants to promote its pubs with their new contest where people can win by showing off their literary skills, ability to pull a pint and conviviality. Pepsi’s “Pepsi People” campaign wasn’t about the product either. Look at MontBlanc, Snackwells and MasterCard – it’s not always about the product! It’s all in how you connect with your audience!

Details, Details

Brands are influenced by their surroundings. They’re also nurtured over time, like children. In order to be successful, brands need good parents who nurture them and help them grow into the best versions of themselves. Brands must have a conscience that will guide them in the right direction, much like an architect plans out how a building will look before it’s built. A Chief Brand Officer has to be able to see what kind of company they want their brand to become and then mentor it towards success based on those goals.

Although big companies have a bad reputation, they’re often able to do things that smaller companies can’t. For example, Starbucks has the resources to offer more benefits for its employees than an independent coffee shop would be able to. Big and little brands should both focus on simplicity, relevance and humanity when it comes to branding.

A New Brand World Book Summary, by Scott Bedbury, Stephen Fenichell
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