You are viewing Aaker on Brands blog posts from April 21, 2015 through September 17, 2015. You can also view the most recent posts.
There are three accelerating branding trends that affect nearly every business. The winners of tomorrow are going to be riding these waves rather than swimming against them.
First, there is a trend from “my brand is better than your brand” marketing to subcategory competition driven by the fast pace of innovation in the marketplace and a growing recognition that, with some exceptions, meaningful brand growth spurts are caused by a new “must have” defining a new subcategory for which competitors are not relevant.
The evidence that subcategory competition is driving growth is abundant. For me, the insight started with my analysis of some 40 years of Japanese beer data. During that time there were only four major changes in market share trajectory. Three of these were caused by new subcategories being formed or solidified: Dry Beer, Ichiban, and Happoshu. The fourth were when two subcategories,…
September 17, 2015 • Permalink
A unique storytelling experience from Clif Bar recently caught my eye. In the “Farmers Speak” series, the brand’s farmers and suppliers explain and discuss why they got started in organic farming and how they operate their businesses.
It works for three reasons.
- It reflects a perfect constellation of three huge trends in marketing and business strategy: the prominence of a higher purpose, the recognition that such a purpose often requires partners, and the power of stories.
- The stories are masterfully told. They are intriguing, authentic and involving. Each of the four minute videos have gotten over 600,000 views.
- It represents a great example of what I call signature stories, which are dramatically effective stories that become a strategic
August 5, 2015 • Permalink
A sizable and growing customer segment is looking for organic and natural products, and as a result, packaged food companies are facing a relevance problem.
One company that has done well in this difficult and changing environment is General Mills. There is a lot to like about their product and acquisition strategy.
The most recent major General Mills acquisition is Annie’s, bought in 2014 for just under one billion dollars. Annie’s makes Mac & Cheese, snacks, dressings and frozen food all under the organic and natural labels. The brand is fast growing, authentic and high quality with an expanding product footprint. The purchase provides General Mills another growth platform in the healthy eating arena.
July 22, 2015 • Permalink
Observing brands in contemporary art can be instructive, especially for brands selling services or products that matter to them but have functional benefits that are hard to objectively value such as wine, financial advice, consulting and sometimes automobiles.
Contemporary art, non-traditional art from 1970, can sell for incredible amounts, amounts that do not seem to be objectively merited. For example, a Damian Hirst mounted shark in the Metropolitan Museum of Art under the title “The physical impossibility of death in the mind of someone living” is said to be worth $12 million. There are some 2,000 On Kawra paintings that consist of a date precisely painted on a black background. One piece, “May 1, 1984,”…
July 9, 2015 • Permalink
On May 3, 2013 Uniqlo became the exclusive, multi-year sponsor of the New York Museum of Modern Art’s Friday night program, which offers free admission in the evenings. Almost a year later in March of 2014, Uniqlo launched SPRZ NY (Surprise New York) in partnership with MoMA. Under SPRZ NY, Uniqlo puts artwork inspired by top contemporary artists such as Andy Warhol, Jean-Michel Basquiat, and Keith Haring on some 200 items that will sell from $6 to $50. Some of the artists, including Ryan McGinness, will personally design clothing items based on their works hanging in the museum. It’s “the place where art and clothing meet.”
The sponsorship is designed to showcase the huge signature 5th Avenue Uniqlo store that is located around the corner from MoMA. The store redesigned the second floor so it looks and feels like a museum, with framed…
July 1, 2015 • Permalink
Google is undoubtedly one of the most amazing success stories of our time, with a market cap of over 365 billion making it one of the top three or four most valuable firms in the world. How did they do it?
The book, Google: How Google Works by Eric Schmidt and Jonathan Rosenberg provides several explanations behind their story, but I was struck by Google’s rather unique perspective on people.
When hiring, training and promoting people, most managers in most firms focus on finding, leveraging or developing relevant experience. It dominates from the hiring interview to career management. Not at Google, where they instead look for and nourish talent. Talent trumps experience.
CEO Eric Schmidt hired Sheryl Sandberg even though they did not have a job for her. When a 2003 search for a…
June 18, 2015 • Permalink
Three books, all written over a half century ago and published within a three year period in the mid-sixties, may have influenced my thinking with respect to marketing and branding strategy more than any other books written since. The authors are Peter Drucker, Ted Levitt, and Alfred Sloan.
Managing for Results, by Peter Drucker
In my view, this is the best single book on management in the market, and it’s still remarkably relevant today. The book states that executives should exploit opportunities rather than solve problems, and then allocate resources accordingly. It really paved the way for brand strategy as an anecdote to short term profits. It also identified identifying and actively managing results as a key role of management. A key result area could be anything that drives success, such as the leadership position for a product, superior technical staff or efficient distribution. Drucker…
May 20, 2015 • Permalink
Don’t Think of an Elephant!, by UC Berkeley linguist Goerge Lakoff, is important to every brand strategist. One of its most powerful points is that it explains how, within a political setting, Republicans so often win policy arguments. The answer is in the framing. Republicans are just very good at it. Lakoff’s insights directly apply to branding.
Framing dictates the discussion and the decision. It affects how we see the world, how we process information, whether that information is distorted, how we interpret it, what behavior occurs, and whether attitude and behavior change is even possible.
It matters whether the frame is tax relief (taxes are an affliction and heroes remove them), paying your share (just as you pay dues at a club, you should pay for education, libraries, roads etc.), or investing for the future (building infrastructure or educating will help future generations). It…
May 7, 2015 • Permalink
The biggest threat facing most brands today is the loss of relevance, because the category or subcategory they are serving is declining. If a group of customers wants a battery-powered car, it doesn't matter how much they love your hybrid brand. It will not be relevant. A newspaper can have the best new coverage and editorial staff, but if readers are diverted to cable news or blogs, relevance declines. If a customer becomes health conscious, loyalty to a high calorie beer goes out the window.
The threat emerges when customers are no longer buying what the brand is perceived to be selling. New categories or subcategories emerge as competitor innovations create “must haves.”
The ultimate tragedy is to achieve brilliance in achieving differentiation, win the preference battle, create a better-than-ever offering with incremental innovations, and build a powerful brand...only to have that effort…
April 29, 2015 • Permalink
Less than five years old, Chinese brand Xiaomi ranks third in global smartphone sales, selling 60 million last year with a market cap of 45 billion dollars. And yes, you read that right – the brand is less than five years old.
It’s a classic success story of a brand using innovation to create multi-“must haves” that define a new subcategory and then, as the exemplar, managing that subcategory to victory. Clayton Christiansen would say that Xiaomi functioned both as low-end and new market disruptor. With its low price and e-commerce distribution strategy, the brand brought smartphones to the middle class of China and “non-consumers” in other emerging countries. Its competitors had no ability or motivation to match the Xiaomi strategy.
In any case, Xiaomi’s successful strategy and the thinking behind it is worth examination:
Xiaomi’s price is often…
April 21, 2015 • Permalink