You are viewing Aaker on Brands blog posts from March 3, 2015 through June 18, 2015. You can also view the most recent posts.
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
In a fascinating study, two Italian researchers from the University of Rome Maria Assunta Barchiesi and Agostino La Bella documented the fact that the most admired companies in the world as reported in Fortune have social responsibility as a key part of their core values. It’s more dominant than customer service, employee focus or any measure of excellence. Further, financial goals like growth and profitability are actually not reflected at the values level. The suggestion is that elevating social responsibility involves an orientation that leads to financial performance over time – or at the very least does not inhibit it. Although I think that is the instinct of many executives, this evidence is reassuring.
The corporate reputation data base is generated by the survey of some 15,000 business analysts by the Hay Group in partnership with Fortune magazine to evaluate firms with revenues of $10…
April 7, 2015 • Permalink
When identifying the top print advertisements and best headlines in the last century of advertising, a 1926 ad written by a young, green copywriter always makes the cut.
John Caples, only one year on the job, wrote: “They laughed when I sat down at the piano—but when I started to play!”
Caples’ assignment was to entice people to buy piano lessons by correspondence from the U.S. School of Music. The hero of the ad was ridiculed by the guests when he sat down, but the ridicule turned to accolades and applause when he begins to play, only a few months after starting the correspondence course. The ad was not only critically acclaimed but brought in a lot of customers.
It illustrates the power of a story that has tension, emotion, challenge and a brand-driven resolution as opposed to a recitation of facts and functional benefits. A story, as we now know, is a powerful way to get people to get…
March 25, 2015 • Permalink
In the future, marketing will involve category or subcategory competition more than brand coopetition. The winners will develop sets of “must have” innovations that will define or redefine subcategories, making competitors irreverent or at least less relevant. One challenge is to create “must haves” that can be delivered and will resonate with customers. Another is to become and remain the subcategory exemplar and to manage the subcategory so that it wins and evolves over time. It’s not easy, but the payoff is huge – and the alternative “my brand is better than your brand” competition is so not fun.
OpenTable is doing just this. Well known for its ability to handle table reservations for over 16 million diners each month in some 32,000 restaurants in six countries, it has now redefined the subcategory by adding new functional and emotional benefits under the tag “The table is just…
March 18, 2015 • Permalink
I believe that most firms in the world have made commitments to environmental programs as a higher purpose. Their motivation is to inspire employees, do the right thing for the planet, reduce costs and appeal to customers thereby engendering admiration, respect and a sense of shared values. All of this leads to a brand-consumer relationship based on more than functional benefits.
BrandJapan conducts an annual survey measuring the strength and profile of 1000 brands, and this year added a question involving whether the brand is “concerned with environmental issues.” The response to this question confirms my suspicion that few brands get recognition of their environmental efforts, even though most brands have significant environmental programs. Why? How can brands with strong environmental goals and programs get customer credit? To answer those questions let’s first look at those few brands that have…
March 11, 2015 • Permalink
Every person has a brand, represented by a name and face. This brand has a host of associations. The brand will influence all relationships and affect how a person is perceived and/or respected.
Your personal brand can be actively managed with disciple and consistency over time, or it can be allowed to drift. There is a huge payoff to employing the active management option and large risks to the alternative.
Here is a road map to getting control of your personal brand:
Assess Your Target Audience
Describe the group who you would like to have the right impression of you. Who would want to spend time with you? Who might admire you? Who do you want to respect you? For example you may want a professional audience, a family audience and a friend audience. You might pick out a few representative people in each segment to provide focus and clarity. It may be useful, at least at the outset,…
March 3, 2015 • Permalink