The distinction between brand propositions and brand values.

When I’m working with organisations looking to internationalize their brands to do business in foreign markets, we often have to spend some time considering the distinction between the ‘brand proposition’ and the ‘brand values’. The brand proposition (or offer) should be flexible to suit the culture and social mores of the individual markets. Even within what may seem like geographically close markets, the emphasis of various dimensions of the offer may need to shift. For example, a few years ago I was involved in the launch in the UK of a range of US fitness equipment. The launch was successful and the decision was made to roll it out over Europe. The client believed the same brand offer was appropriate across the target countries. However, research showed subtle differences in each country’s attitudes to exercise. The British wanted to be fit and lose weight, the French were more interested in looking good, while the Germans wanted to be strong and fit.

If you wish to learn more about surprising cultural differences, I thoroughly recommend Geert Hofstede’s excellent book, Cultures and Organizations – Software of the Mind. Or take a look at his personal site http://stuwww.uvt.nl/~csmeets/.

The further you venture from your own culture, the more prepared you may need to be to change the emphasis of the offer – the brand ‘proposition’ may need to change.

This is where the distinction comes between the brand proposition and the brand values – propositions may change, but values are more static. It may be helpful to think of the values as more strategic, while the offer is more tactical. Consider the parallels with diplomacy – where a nation’s values should remain the same across its foreign policy, the way its diplomats deal with different countries with different cultures, regimes and attitudes will vary greatly.

The brand offer is pragmatic – amenable to persuasion, argument and declarative proof. Brand values are fundamentally emotional – they are to do with a meta-knowledge we have about a brand; a different ontology that is less accessible to change by argument.

Toyota brand the new ‘tall poppy’?

The poor old Toyota brand is the latest to be in the firing line with news of its vehicle recalls.  It is interesting to observe the various dynamics at play here:

1. Toyota has a great reputation for reliability and build quality to the point of almost being boring. So, no matter what great strides forward they make it is unlikely to be newsworthy. No wonder the media leapt on this story, and little wonder Toyota spokespeople seemed so confused and wrong-footed. This is new territory for them – the spill-drill is probably lost in a bottom drawer somewhere.
2. As Tom Peters observed in ‘In Pursuit of Excellence’; excellence of service soon becomes accepted as the norm – so you have to be constantly pushing it. Once you have reached that high point it would be easy to say the only way is down, but that is a cynical view as boundaries are always able to be pushed. It’s just that every step forward takes +2 effort for +1 gain: every -1 slip back is measured as -2.

I have often argued that brand damage, especially where it attacks the core values of a brand, is disproportionate. We saw it with Anderson consulting over Enron, and more recently with some major banks. If the value of a brand’s core intangible assets is, say, 100 and it suffers core value damage of, say, 10, it does not go down to 90, but often down to 10 or lower.

One of the key reasons we chose brands is their reliability on delivering their promise. We may choose a brand of coffee because it always has the same good taste – if we taste it one time and it is bad, the hundreds of previous good cups count for nothing. The reliability of the brand promise is irreparably damaged.

For Toyota, I would be quite optimistic. So far, actual failures are very few where satisfied customers driving around are legion. There does not seem to be a major safety issue (a critical success factor for an automotive brand), so just some overenthusiastic journalists looking for another tall poppy to behead.

Perhaps one area where Toyota may need to take a close look at itself is in its customer relationships – just like drivers take the reliability of Toyota for granted, has the company done the same for its customers? I do hope they are closely watching the blogs and forums.

Cigarette packs with no logos – what are they thinking?

I hear today that in the government’s crusade against smoking their latest potent weapon is a suggestion to ban logos on cigarette packs! Apart from being a crazy and impractical suggestion it once again demonstrates how governments and public bodies just misunderstand how brands work. What on earth do they expect that will achieve?

They have not suggested totally removing branding; by that I mean removing all maker information, which would fly in the face of packaging rules and make manufacturers untraceable. So, brands will still exist – with or without logos. Logos are just symbols, icons for brand values, brands can exist perfectly well without them.

But just let us imagine how things would be without cigarette manufacturers’ brands – what would happen? Brand focus would simple switch to retailers. Think of meat or vegetables – these are generally unbranded, but consumers choose a particular butcher or greengrocer because they trust their products. The same would be true of cigarettes – people would simply make preferences between Tesco, Co-op or Waitrose’s ‘unbranded’ cigarettes.

When does a communications asset become a brand asset?

I was reading an article last week proposing that Aleksandr Orlov (the meerkat face of the comparethemarket.com TV ads) is the new saviour of TV advertising. Well, that may or may not be the case, but it is a brilliant application of the device of creating a memorable brand character.

There is nothing new in this approach of course, and there are many other applications across various media even now. For decades, advertising agency Geers Gross embodied the approach at the heart of its philosophy, making use of the Homepride flourgraders, ‘Your Flexible Friend’ the Access card, Countrylife buttermen and the Yellow Pages walking fingers. One great advantage of using these created assets is safety and control – Orlov is unlikely to be involved in a sex or drugs scandal like a sports star or actor used to face up a brand.

While these are great promotional assets, they are often described as ‘brand assets’ and I question whether that is a useful way to think of them. It may be a simplistic view, but I have always considered brands to be long term and strategic, where advertising and promotions is short term and tactical. It is the job of such promotional communications to capture the zeitgeist of their cultural context. Indeed it is their transient nature that allows us to be risky, exciting and push the boundaries whereas we take great care with brand assets to transcend the vagaries of fashion and invest for the long term. Few of these promotional assets stand the test of time – and that is not to criticise them, but they are their to do a job and when their work is done they have the good grace to leave.

Intangible brand assets or just intangible assets?

There were the bad old days when brands were not even valued when considering the worth of a business. Today, brand valuation is seen as vital and many takeovers are purely involved in acquiring brands. I have talked before about brand valuation (or evaluation) but not in terms of the components that make up the brand – the majority of these are what I refer to as intangible brand assets (IBAs) that make up the lion’s share of a company’s intangible corporate assets.

You can break these down into three categories:

Human IBAs

These include: skills, relationships, leadership, discourse, partners, values and human rights.

Structural IBAs

These include: history, geography, organization, ownership, financial, intellectual properties, distribution, supply chain and processes.

Promotional/communications IBAs

There include: brand identity, brand and product names, corporate signature, advertising assets, media reputation, URLs and corporate colours.

There are a number of uses for a classification such as this. Together with standard brand valuation methods you can identify and value the components of the brand by giving a weighted score to each category. They can be used for a SWOT analysis of your brand, and to rate your brand against your competitors as part of constructing a brand strategy.

Understanding how IBAs work together as a whole can help avoid some of the inadvertent brand damage that can occur when items are neglected or their importance overlooked in brand terms. Careless discourse within the organization (perhaps referring to customers as ‘punters’) or overlooking the importance of the business’s history, may seem like small points but once they are seen and valued within the whole context of the brand, their worth becomes apparent.

An intangible brand assets checklist is available for download on my website.

How geographically contextual are brands?

When I work with companies on their business offer to international markets, I ask them to consider how important Englishness, or Britishness is as a differentiator for their brand in target markets. The same I am sure is asked by my counterparts all over the world. But recent events have brought this to the forefront of my mind once more. Firstly there was the announcement that the very English Twinings Tea packing plant in North Shields is to close and a portion of the business will move to China and a New facility in Poland. The second was the news that Cadbury is to be taken over by US food giant, Kraft. Does it matter?

Perhaps for differing brands it matters to greater or lesser extents, but I think it is important to look at the geographic context in two dimensions.

Culturally defining

Some brands’ values are important in defining the nation and the people from whence they originate. Twinings tea and Burberry coats etc. help define Britain. As Volvo and Ikea define Sweden.

Culturally defined

By this I mean brands that are intrinsically tied up with the culture of their nations – by the characteristics we associate with their people – German engineering, Italian fashion etc.

There is no simple dichotomy of course: far from it. It is often the major brands that help define the culture that we then attribute to other brands.

In an increasingly global culture brand origins, place of manufacture and ownership are increasingly confused. We see the iconic British ‘Mini’ brand now under German ownership, manufactured in the UK and benefitting from the Issiagonis heritage and German build standards. Does it matter that Knightsbridge store Harrods is owned by an Egyptian? Hmmm… well…..

Santander paints the town red

I was looking to write a post on the Santander re-branding, and came across this post in Jonathan Gabay’s excellent blog – ‘Santander brand turns UK high street red’.

My interest in this is how the arena acts as a system. This is 80% a brand communications exercise and poses some very interesting questions, firstly for the UK consumer who will be building their own narrative about the brand values of what is still a new player to them. Existing customers of Abbey and the others will carry forward some brand value perceptions. In the high street, three small brands have been replaced with one large one, which could lead to more ‘room’ for new entrants. And the one big brand will be taking a bigger share of voice from the major players.

Bernie and the Saab brand

So, Bernie Ecclestone has thrown his hat into the ring as a possible purchaser of Saab from GM. It’s another interesting spotlight on the value of a brand. BGC Partners’ senior strategist, Howard Wheeldon, wondered, ‘Why on earth would the 79-year-old Formula One tycoon Bernie Ecclestone, together with partner Genii Capital, of course, be interested in acquiring the ailing Swedish-based carmaker Saab from GM?’.  Well, I would not even hazard a guess at what goes on beneath Bernie’s silver mop, but one thing is certain, it has nothing to do with current models, production facilities or distribution networks. In fact, it probably has little to do with tangible assets at all (though you can be sure the accountants have been all over Saab’s books like a rash). No, it’s all about the brand.

But it is an interesting case in many ways, and another example of a brand which is way out of balance with the scale and value of the business. We cannot even look at the value of the pragmatic knowledge we have about the brand. I’m old enough to remember the glamour days of Saab rallying with Pat Moss and Erik Carlsson, but I doubt that may of today’s consumers will.

It is more about the emotional meta-knowledge we have about the brand, which has really done nothing physically for a few decades. Creating brand archetypes for buyers of the Saab brand (I mean consumers, not Mr Ecclestone et al) we would probably be looking at a lover of the quirky who did not want to be pigeon-holed; a family or company driver beyond the hot-hatch days but financially out of the supercar bracket. The hint of the ‘as driven in rallies’ and more recently the Turbo giving a degree of spice to the brand choice. He or she probably carries a personal narrative of being a bit of a nonconformist which is reinforced every time they insert the ignition key, down next to the hand brake.

There is all sorts of speculation about what Bernie will do with the brand is the purchase is successful, though he has hinted that he might see it having a future in motorsport. That could be an interesting brand strategy to endorse the pedigree and raise profile before rehabilitation of the brand in the consumer market.

Trust me, I’m a politician.

We are about to see the unedifying sight of our political parties trying to polish their brand images ready for an election. It brings me back to the two types of brand knowledge: the declarative, pragmatic knowledge that we handle consciously, by high-involvement processing and then the emotional, meta-knowledge that we do not handle at a conscious level but use low-involvement processing. The former type of knowledge is assembled by our perceptions and is susceptible to communications, including advertising and PR messages. But still there is our emotional view of the parties which cannot easily be manipulated even by the cleverest of campaigns.

As with all brands it is about core values, and I am concerned that our current distrust of politicians of every stripe may have seriously blunted the effectiveness of any brand communications in the coming round. Our emotional representation of their core values may prove to be more powerful than any overt messages.

It looks like being a very interesting few months and my gut feeling is that the successful parties will be the ones who take those core emotional values as a starting point and build their communications upon them. Anyone who starts with the approach of, ‘Trust me…’ is off on the wrong foot, I’m afraid.

Ten Brand New Year resolutions

What kind of a year will 2010 be for brands? Well, 2009 was quite up and down and we seemed to be rocked by events both economical and commercial, so I guess one watchword for 2010 must be to take as much control for the destinies of our brands as we can. So here are my personal thoughts on 10 Brand New Year resolutions – you will have your own I’m sure, so please feel free to share.

1. Put brand leadership centre stage – put your brand firmly at the heart of your organisations and operations. Add the brand as an item on all meeting agendas – even your board meeting.
2. Be sustainable – take a look at the Green Brands 2009 report that I mentioned in my last post. Sustainability will become less of a differentiator and more of a critical success factor.
3. Don’t let operational issues become brand problems - we’ve seen some disasters in the recent past; BA, Eurostar, McClaren etc. But things will go wrong in life – that we let them become a communications disaster should not follow.  Get your ’spill drill’ in place ready, so you won’t have to go and hide in the ‘No-Comment Hotel’.
4. Ditch your mission statement - if you still have one. The world is changing, your corporate and brand values are too. Your vision should be shared… values come out of the organisation and are the product of the beliefs your people share, not something imposed from above.
5. Do a values audit – talk to your people, ask them what they think are the values of your brand – then do the same with customers… it’s amazing, but if you ask people things, sometimes they will just tell you! Then compare them to your own views.
6. Watch your competitors – not just from an aggressive (or defensive) standpoint, but look what they are doing right – what they do better than you -  admit when they do something very well and learn.
7. Evaluate your brand – try to put a price on it. There are sophisticated models for brand valuation, if you are big enough you probably use them already – but even if you control a relatively modest brand, take a stab at what it’s worth to you. Perhaps estimate how much you have invested in your brand in advertising, marcomms and brand communications over the years? Or, if a competitor wanted to licence your brand how much would you charge?
8. Talk to people – social media, love it or hate it, is a powerful force. People will be talking about you and your brand like never before. Get involved in those communications – stimulate and initiate discussions, but above all… listen.
9. Be ‘arsed’ - it’s the details that make such a difference and say so much about your brand and your attitude to it and to your customers.
10. Take a day off – when I do training or coaching sessions (usually off-site if I can) one thing clients always find most of value is just getting out of the business for a day and taking the ‘helicopter view’ of their business. So, why not have a ‘brand day’ once a month?

Okay, I’ve shown you mine, now show me yours?