I have had the great fortune of spending the past 15 years of my career working side-by-side with one of the greatest marketing and business minds of our lifetime, David Aaker. I studied, quoted, learned and even stole from Dave’s landmark work on brand in my formative days at P&G and my early days in consulting. My first book, Brand Asset Management, was an homage to Dave and I can honestly say there isn’t a finer man or thought leader who continues to remain as relevant as my friend Dave Aaker.
Fittingly, Dave is being inducted into the American Marketing Association, New York Chapter Marketing Hall of Fame later this month, so I thought it was even more fitting to get his take on brand building today and how it has changed over the decades since he put brand management on the map. We have been talking a lot about building relentlessly relevant brands at Prophet, so why not sit down with the relentlessly relevant icon himself? Below are excerpts from my conversation with Dave.
First, congratulations. You were recently inducted into the NY American Marketing Association’s Marketing Hall of Fame, and people have called you “the Plato and Newton of Branding.” What are some of the biggest changes you’ve seen in the industry over the last decade?
Thank you! It was quite an honor when I found out I was being awarded this distinction.
My early work and research primarily focused on brand equity, which at that time was a shift away from the tactical, sales promotion-focused marketing rules that most companies followed to more of a strategic platform. I tried to signal that marketing needed to be owned by top management, and measured by something bigger than short-term sales. This notion was hard to sell in at first, but that original shift has continued even more over the last few years.
There is now an emergence of subcategory competition, as firms realize that the best route to growth is achieved through innovation — creating “must haves” that define new subcategories, and then managing those subcategories so they win while making other brands irrelevant. This process requires a whole new mindset; one very different than “my brand is better than your brand” marketing.
There is also been a shift to the digital communications age that has been transformational. We’ve moved away from mass media, where marketers told customers about products, to one ruled by digital and, in particular, social media, where people can ignore “the push” and find what really matters most to them. People are interested in babies, not diapers and, thus, Pampers Village was created. Women care more about Avon’s fundraising walks for breast cancer than they do about Avon lipstick. Brand leaders now understand the need to aim conversations at customer interest and passion areas and not just in what the company is trying to sell.
Would you say we’re moving away from your original measure, brand equity, to something more current and relevant, like brand engagement?
The original dimensions of visibility, image, liking and loyalty are still important but we need to add other dimensions. For example, brand engagement is now more important because it drives so much of the marketplace today. And credibility, a driver of relevance, is also a dimension that is increasing in importance.
How do you communicate in the digital age?
You need to realize that customers are really uninterested in what brands, companies and products say about themselves and that means that most conventional marketing is not engaging and, worse, is ignored. The development of programs linked to what customers are interested in is one way. It helps if the brand has a higher calling, a sense of purpose that people admire, and shared values. It also helps to have a set of stories that can represent your brand in an authentic and compelling way to customers and employees.
Are there companies you think are winning now, or best prepared for these challenges?
Patagonia is one company that excels in just about every area of customer engagement and higher calling. Its stories around its founder, history and programs are compelling and remembered. Patagonia’s steady dialog around sustainability includes suppliers, customers and even competitors, and has substance and credibility. Tesla and Whole Foods Markets also do this really well. These are companies that live the promise and make their customers feel good about buying their product or service, while also making a profit.
One of your passions is brand relevance. Not only did you write the book about it, but you’ve entered it into the lexicon of marketers and executives everywhere. What does it take for a brand to stay relevant in these ever-changing times?
If a brand is talking about remaining relevant, it’s already playing defense.
If a brand is talking about remaining relevant, it’s already playing defense. You want to continually create subcategories so that others have to play defense. Toyota’s Prius is one of my favorite examples, and has had something like 50 percent share of the hybrid market for 15 years. Prius doesn’t have to be relevant, but its competitors do. There are something like 35 hybrids available now, but they don’t even make it into the consideration set because Prius built the subcategory – those 35 are all challengers.
Of course, that doesn’t happen very often—a company is lucky to have a product that game-changing once every five years.
Besides luck, what else can companies do to continue to be relevant?
They have to make what people are buying and meet consumers where they are. Compare General Mills with Kellogg. General Mills is doing lots of interesting things for people interested in organic food. It acquired Annie’s, a popular organic brand. It’s introducing gluten-free options. It’s simply providing what people want.
But there are other approaches. Plenty of companies stay relevant by fighting those innovations—take some of the really indulgent burger restaurants. Despite an enormous trend toward healthier foods and lighter meals, they’re saying, “Don’t listen to them! We make great burgers! Treat yourself!” This works too, because even the healthiest eaters sometimes say “you know what, I do deserve to treat myself.”
Others try to stay in parity to others, and find relevance that way. McDonald’s added yogurt and salads in order to gain greater appeal of healthier eaters. Some reposition themselves to gain consideration in a whole new way, in fact creating a new subcategory. A fun example is DiGiorno pizza, which used marketing to position itself against delivery pizza, instead of other frozen pizza brands.
How does customer engagement enable subcategories?
To me, Dove is one of the best examples of this. By understanding that women want to talk about inner beauty, it’s been able to expand far beyond soap into deodorant, shampoo, body care and even men’s products. Unilever found something women are very interested in talking about and sharing via social media, resulting in serious brand awareness and growth (despite controversy every now and then).
Tell us one thing most people don’t know about you.
I like to be active and try to bike and golf as much as I can, I am a huge Cal fan which is usually very frustrating, and I once was a competitive tennis player. I’ve also played well over 30,000 games of backgammon.
Dave, thank you for your time, your incredible contributions and your desire to continue to move the brand dialog forward. On behalf of all of your colleagues at Prophet, it continues to be an honor to call you a partner in crime and a friend.