You are viewing Aaker on Brands blog posts from September 4, 2013 through November 6, 2013. You can also view the most recent posts.
As my book Brand Relevance asserts—the only way to grow is to create a “must have” that defines a new subcategory and then manage that subcategory by becoming its exemplar, by ongoing innovation, and by managing the perceptions and attitudes toward the subcategory so the subcategory wins.
No brand has done that better than Gillette.
Instead of being killed off by the introduction of the electric razor in the 1930s, it used innovation and self-expressive benefits to lead the subcategory (and thus Gillette) into profitability and dominance for the better part of a century throughout the developed world.
Gillette has been most impressive in India. In 2008, Gillette’s premium shaving subcategory needed to fight the low end, double-edged razors that had 80 percent of the market, as well…
November 6, 2013 • Permalink
Most executives like to know how valuable their brand is relative to other brands. What is its ranking, and has that ranking changed during the last year or so? Positive answers to those questions lead to accolades to the CMO, and negative answers lead to embarrassed silence, at best. The problem is that the data that appears to answer that question really cannot do so. What we actually have is an illusory quantification that means little in the context of these questions. Those that use the valuation numbers and rankings in that way are making a big mistake. Those that act on them are making an even bigger one.
To simplify, the value of the brand is based in large part on two numbers: The value of the business and the percent of impact of the intangible assets attributed to the brand. When a brand controls the business of the firm as is the case for GE, Microsoft and Ford, for example, the value…
October 30, 2013 • Permalink
I have three favorite charities that also happen to be my favorite nonprofit brands: Feeding America, Teach for America, and Nothing But Nets. The charities share some notable characteristics.
- They all have: addressed a meaningful social and economic problem area. There are 16 million children living in poverty in the U.S. needing food and education. Every 60 seconds in Africa a person, mostly children, die of malaria.
- They all have: a concept that really works administered with a smart, competent staff with impressive executive leadership. The Teach for America teachers have proved they can turn around challenging schools. Feeding America provides food for people that need it to thrive and sometimes to survive. Nothing But Nets puts insecticide-treated bed nets in the hands of families, nets that change the odds against malaria.
October 23, 2013 • Permalink
A strong brand can add value in a way that has been ignored—by making the firm more attractive to executives so they will accept less salary. In an era in which salaries are mushrooming out of control, this is no trivial matter for recruitment and for shareholder interests. A recent paper by Nader Tavassoli (London Business School), Alina Sorescu (Texas A&M), and Rajesh Chandy (London Business School), “Employee-Based Brand Equity,” documents that assertion and explains why.
Executive attraction to a job is based in part on a drive for self-enhancement among a reference group. Associating with a strong brand provides connections that transfer to the executive, such as prestige and success. The implication is that the steward of a strong, successful…
October 16, 2013 • Permalink
Malcolm Gladwell’s latest book, David and Goliath: Underdogs, Misfits, and the Art of Battling Giants (2013), is provocative. He makes several points about mismatched contests. Although he does not use any business or brand examples, many of his points could have been drawn from the world of business strategy.
Firstly, the “giant’s” advantages can also be a source of weakness. Goliath was huge and strong but the size he was blessed with caused him to be slow and have bad eyesight. The giant firm is really good at their business model; they are financially successful and make incremental improvements each year which apparently make them even more formidable. As a result, there is no incentive for them to change. The current system is working very well, but that “stick-to-your-knitting” concept makes them vulnerable. Another giant firm advantage is size and the resulting clout in…
October 9, 2013 • Permalink
Marketers can learn about the power of framing both from both Republicans, who are so good at it and also the Democrats, who are so bad. The latest Obamacare activity is the perfect example. The issue I’m discussing here isn’t to do with whether or not Obamacare is good (or bad) for the nation – it’s rather how each side of the debate is framing their opinion successfully or unsuccessfully. The Republicans won the Obamacare framing battle by a big margin. The question is, did they overreach?
The Republicans framed the healthcare discussion with the label “Obamacare” and thus associations were created, especially among Republicans and independents, of big government, taxes, mandates, loss of control over individual medical care, and President Obama. Their attacks on Obama are twofers – they’re attacks on the President and on Obamacare as well.
Democrats could have framed…
October 2, 2013 • Permalink
Taco Bell, Ad Age’s Marketer of the Year, was recognized for their brand’s incredible turnaround. In 2011, Taco Bell sales declined by 1.4% in part because of a January lawsuit alleging that their beef taco was not really all beef. In 2012, the brand came roaring back with store sales up an astounding 8% and the momentum continued in 2013. How did they do it? The answer is threefold: wildly successful product innovation, a radical new brand position around “live mas” (live more), and a creative social media program with a host of tentacles.
September 25, 2013 • Permalink
How does an emerging market brand break into the US and other major markets? Try diaspora marketing, advise Nirmalya Kumar and Jan-Benedict E. M. Steenkamp in an October Harvard Business Review article. Diasporas are groups living away from their birth countries such as first-generation immigrants. The idea is to market your brand to a group that is familiar with and has an affinity for offerings that come from their home country. When that group provides a sales base, it gradually expands to people connected to the diaspora and finally to a broader market. This strategy avoids the often unfeasible attempt to build a brand on foreign shores from zero.
The diaspora strategy not only provides a solution to a tough problem for many brands. Firms attempting to engage in brand extensions can learn from these ideas. Look first…
September 18, 2013 • Permalink
Neural marketing, which involves techniques such as fMRI (functional Magnetic Resonance Imaging) or EEG (electroencephalogram), is a hot topic in marketing. It can purportedly generate insight into consumer response to marketing variables while reducing the biases inherent in asking consumers their opinion, such as when they are not able or willing to give valid answers to questions involving perceptions, attitudes, or behavior. Further, consumers are driven in part by subconscious thoughts and emotions that neural marketing techniques can access. There are estimates that 95% of all thoughts are subconscious.
Neural marketing, in the right context, can measure variables like attention, engagement, emotion, pleasure/liking, and memory. Each of these can be an extremely relevant dependent variable of interest when testing or evaluating many marketing stimuli.
Here are several interesting…
September 11, 2013 • Permalink
In the late 1980s, brand equity was just emerging as an important idea. In 1991 I published a book, Managing Brand Equity that defines brand equity and describes how it generates value. This model provided one perspective on brand equity that is worth another look now over twenty years later.
I defined brand equity as a set of brand assets and liabilities linked to a brand name and symbol, which add to or subtract from the value provided by a product or service. Connecting “brand” to the concepts of “equity” and “assets” radically changed the marketing function, enabling it to expand beyond strategic tactics and get a seat at the executive table. Marketing was reframed by an avalanche of researchers, authors and executives who provided substance and momentum to this idea.
September 4, 2013 • Permalink