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The Digital Marketing Suite

Advanced companies need integrated tools to succeed in digital business. Suites are the solution.

As companies become advanced in social and digital business, they require consolidated technology instead of point solutions

Adobe Marketing Summit and Oracle OpenWorld both took place recently. It’s another month until Dreamforce, but I expect similar announcements to be made there. These giants are all building “suites” for cross-channel customer engagement through a series of acquisitions and integration with their existing offerings (see Figure 1). Among the pieces, each has bought social media monitoring and management tools, as well as marketing automation players. Having a complete social offering is a big part of this, but it’s also about integrating social with other customer engagement channels for the best data, targeting, and contextualization. The result: a technology suite that goes beyond just social, designed to entice CMOs with one-stop shopping convenience. Figure 1: How Three Companies Are Creating Digital Marketing Suites

ComponentSalesforceAdobeOracle
Social media monitoringSalesforce Marketing Cloud (Radian6)Adobe Social (Adobe SocialAnalytics)Oracle SRM (Collective Intellect)
Social media managementSalesforce Marketing Cloud (Buddy Media)Adobe Social (Efficient Frontier / Context Optional)Oracle SRM (Vitrue & Involver)
Social media advertisingSalesforce Marketing Cloud (social.com)Adobe Media Optimizer (Efficient Frontier)N/A for now; on product roadmap
Marketing automation & multi-channel targetingSalesforce ExactTargetAdobe Campaign (Neolane)Oracle Eloqua
Analytics & insightsSalesforce Marketing Cloud (Radian6)Adobe Analytics (Omniture)Oracle SRM and OBIEE (Oracle Business Intelligence Enterprise Edition)
Content marketingNo internal component, but integration (e.g. Kapost)Experience Manager & Creative CloudCompendium
Enterprise social networkChatterN/A, although has built collaboration into Marketing CloudOracle Social Network
Data & CRMSalesforceNo CRM, but has Omniture DataWarehouse and data connectors into partner solutionsOracle Database (plus Siebel), Oracle Sales Cloud, Oracle Service Cloud, Oracle Commerce

It should go without saying that this chart is not an exact comparison and that line item “components” vary in complexity. The degree of integration also varies.

Advanced companies need integrated tools to succeed in digital business

These suites are finding an audience ready for a better option. Focused on social business for a moment, brands are getting increasingly advanced, yet they continue to use point solutions in different departments and channels for monitoring, management, optimization, and analytics. In a typical example, one of our clients uses Radian6 for monitoring, Vitrue for social content publishing, Cotweet for customer care, and Adobe Analytics (formerly Omniture) for web analytics.

Plus enterprise social networks and customer communities are disconnected. The result is disparate sets of data being compared in Excel, mixed levels of communication and collaboration, and lost insights. The emerging need for more integrated solutions has been anticipated by Salesforce, Oracle, and Adobe, who are now assembling Digital Marketing Suites.

Best-in-class point solutions dominate today, but change is coming

Although point solutions can’t fully address the needs of an advanced social business, they are often best-in-class—because the promise of the Digital Marketing Suite has yet to be fulfilled. When advising clients on monitoring tools or SMMS today, we often end up recommending point solutions. This is based on specific client requirements, which vary, but it’s not often that one of the “giants” makes it to the very top of a shortlist. With SMMS for example, the offerings are good but not typically best for the client. And overall, the benefits of a suite aren’t compelling enough today—but over the coming 12-18 months, they will be.

“The promise of the Digital Marketing Suite has yet to be fulfilled.”

The future is suites—or irrelevance

Not only will there be consolidation in terms of technology coalescing into larger suites, but the marketplace will also go through the natural evolution and consolidation as the landscape matures. For social marketing vendors determined to stay independent, there is only one option: to raise money to scale into suites themselves by buying or quickly building missing components like monitoring, optimization, and analytics. Several SMMS vendors like Hootsuite, Sprinklr, Spredfast, and HearSay Social have raised significant rounds of financing to build scale.

They are embedded and tough to replace, and integration-enabling APIs may extend the timeline, but over time that will not be enough to support so many players. Consolidation or exits are an inevitable outcome, as it has been in previous technology spaces. A few of the other SMMS vendors have already folded, like Awareness Inc. and Syncapse. This left their customers high and dry and needing to start the search for vital tools all over again. That has been another reason why some companies are looking to the big players—simple staying power.

What does the future look like with Digital Marketing Suites?

Beyond the obvious benefits of integration, like fewer tools and logins, and platform security that come from an integrated suite, there are four impending changes that marketers should watch closely:

1. Internal and external social networking on a single platform

In SMMS, collaboration features are mostly limited to basic workflow (tag, flag, annotate, route). Yet as social permeates an organization, the need for internal communication through Enterprise Social Networks (ESNs) becomes necessary to plan and react to external engagement. Adobe has already made a push to bring greater collaboration into its new Marketing Cloud offering, although it does not have an ESN product of its own. Salesforce will undoubtedly integrate Chatter into future offerings of its own Marketing Cloud, while Oracle is embedding Oracle Social Network into the social publishing workflow for collaboration. Companies with installed ESNs are also eager to tap and evolve internal employee engagement and direct it toward external conversations for purposes like providing customer support and employee advocacy.

2. Company-wide utility—this is not just for one department

Most SMMS address one or two departments’ needs well, yet we found that companies today are likely to have up to 13 departments involved in social. Social customer support may require the features familiar to a call center, whereas marketing may require a content repository and an editorial calendar that includes earned media. Because each department has different use cases and metrics, these suites are looking to address the needs of many departments rather than just the one or few primarily addressed today. Marketing is central, but other stakeholders are increasingly being involved.

3. Customer relevance and targeting (Social CRM)

Speaking of sharing nicely across departments, the growing need for a common view of customers’ social profiles and social behavior data is also driving a move to suites. Several SMMS vendors have focused on customer identification and targeting from the outset—but few integrate well with marketing automation and enterprise CRM systems in order to know and target customers based not only on social data, but all available customer data.

To take an example, Walmart allows Facebook fans to Like local stores, then shows them items specific to that store, based on comparative local prices and even the local weather. By integrating (in this case, location) data, the relevance of its content is increased. For now, customers remain mostly anonymous, so only certain layers of relevance may be applied at any given time (geography, demographics, psychographics, socialgraphics, mobilegraphics, brand affinity, loyalty program, etc.). So far, the local Walmart pages have little engagement, since they still feel impersonal compared with other local businesses.

Eventually, though, companies will have a single customer view, connecting these layers of relevance for contextual, personalized messaging for individual customers and prospects. This has been a long-term promise and the customer journey keeps getting more complex, but Adobe, Salesforce and Oracle have all been especially focused on this of late.

4. Bigger sticker price and IT involvement

The average enterprise deal size for SMMS has steadily increased over the past few years, rising from $76k last year to deal sizes of what we typically see today in the $100-150k range. This reflects a growing ability to spend on social software where there is perceived value.

These larger Digital Marketing Suites will naturally be even more expensive, but as social is integrated, an independent social business technology budget will be a challenge for most marketing organizations that are still just beginning to build out their social business capabilities. Also, because these suites are larger in scale and require greater care to be “plugged in” correctly, marketers will need IT to be more involved than it has been in decisions like SMMS, which marketing departments have in some cases been able to buy and install on their own.

P.S. Digital Marketing Suite seems like a good name for now, but this goes not only beyond social but even beyond marketing. While Adobe and Salesforce each have their “Marketing Cloud,” Oracle has its “Social Relationship Management,” which is department-agnostic, but of course, focuses on Social (Oracle Eloqua is referred to separately for now). So what is this called, really, and does it change over time?


FINAL THOUGHTS

While there are still plenty of best-in-class point solutions, more companies are offering a full suite of solutions. And it’s about time. Advanced companies need more integrated tools, so they can better navigate complexities. The future is either suites–or irrelevance.

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Will Neural Marketing Become A Game-Changer?

Some people think MRIs and EEGs may soon be a standard in the marketing research suite. We’ll see.

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 opinions, 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 anecdotes involving neural marketing:

  • The MiniCooper from BMW was designed with the aid of fMRI equipment. The physical characteristics of the model were linked to a highly likable and beautiful baby face. It was said that the resulting design made people feel like caressing the car.
  • Frito-Lay used EEG technology to learn that when Cheetos made the fingers of an eater turn orange a strong response was created.  The consumers liked the messiness of the product perhaps because it reflected an indulgent experience and because it indicated that the product really was infused with cheese. This insight was exploited in an advertising campaign.
  • Tests of neural activity associated with unknown songs predicted their eventual commercial success.
  • Campbell’s Soup used neural research to guide a redesign of their iconic packaging.
  • Neural research has helped practitioners design stimuli that lead to engagement on social media.
  • The Weather Channel has used EEG and eye-tracking to measure viewer reactions when showing different promotions to a popular show.

What is the future of neural marketing? Will it become an important and even game-changing technique? Or will it become more of an academic research tool that will be helpful commercially in niche contexts? I predict the future is more in line with the latter because of fundamental limitations.

  1. The equipment is highly intrusive which limits the stimuli that can be presented. The EEG measure requires wearing a hat with measurement devices attached. The fMRI is beyond intrusive. Respondents have to ride through a tunnel and endure the risk of claustrophobia and the loud, high-pitched noises that accompany most experiences.
  2. EEG technology is not capable of reaching the interior of the brain where an area reflecting pleasure and liking exists.  The fMRI is extremely expensive to own and to use, the polar opposite in terms of the cost of conducting something like Internet-based surveys.
  3. The results are ambiguous and probably unreliable even in expert hands. It turns out that a lot of emotions can activate most regions of the brain in addition to target stimuli; in fact, some may be the opposite of what is being hypothesized, for example, eliciting disgust rather than liking. It takes a great deal of skill and experience to design experiments that guard against spurious results and to interpret the results accurately. Research to determine if findings are robust is probably rare.

“Neural marketing, in the right context, can measure variables like attention, engagement, emotion, pleasure/liking, and memory.”

Neural marketing reminds me of motivation research that was introduced in the 1950s by Ernest Dichter. Like neural marketing, motivation research aimed to understand the subconscious and its impact on motivation and choice. Dichter, a clinical Freudian psychiatrist, used in-depth interviews to find out what was motivating people. He famously linked Campbell’s soup to a mother’s love. He was very good at translating his insights into why people buy into copy like “wash your troubles away.” In the hands of Dichter, the insights were magical. But, more generally, as time passed and it became clear that motivation research insights were often not reproducible, the method was all but discredited a few decades after Dichter pioneered them. However, it is clear that many of the current qualitative research techniques incorporate some of his methodology.


FINAL THOUGHTS

My take is that in the right hands and when addressing the right problem and context, neural marketing can be helpful but it should not be oversold. And, at least with the current technology, it will be something of a niche technique. It will make significant advances in technology for it to do more—but I and others have underestimated new technologies before…

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What Is Brand Equity?

Brand equity is a term used to describe the value of having a recognized brand, based on the idea that firmly established and reputable brands are more successful. More specifically, it’s 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.

To help break down brand equity and provide details about how the term is used in the marketing industry, we’ve outlined how it all came into place, why it’s so valuable and a roadmap for success.

How Brand Equity Came Into Place

In the late 1980s, brand equity was just emerging as an important idea. An avalanche of researchers, authors and executives who provided substance and momentum to this idea reframed marketing.

In 1991, I published a book, Managing Brand Equity, which defines brand equity and describes how it generates value. This model provided one perspective on brand equity that is worth another look now more than twenty years later.

Why Is Brand Equity So Valuable?

Another aspect of the definition of brand equity that I presented in my book was the argument that brand equity is that it also provides value to customers. It enhances the customer’s ability to interpret and process information, improves confidence in the purchase decision and affects the quality of the user experience.

The fact that it provides value to customers makes it easier to justify in a brand-building budget. This model provides one perspective of brand equity as one of the major components of modern marketing alongside the marketing concept, segmentation, and several others.

The Roadmap for Building & Managing Brand Equity

Brand equity has four dimensions—brand loyalty, brand awareness, brand associations, and perceived quality, each providing value to a firm in numerous ways. Once a brand identifies the value of brand equity, it can follow this roadmap to build and manage that potential value.

  • Brand Loyalty
    • Reduced marketing costs
    • Trade leverage
    • Attracting new customers via awareness and reassurance
    • Time to respond to competitive threats
  • Brand Awareness
    • Anchor to which other associations can be attached
    • Familiarity which leads to liking
    • Visibility that helps gain consideration
    • Signal of substance/commitment
  • Brand Associations (Including Perceived Quality)
    • Help communicate information
    • Differentiate/Position
    • Reason-to-buy
    • Create positive attitude/feelings
    • Basis for extensions

The introduction of brand loyalty to the model was and is still controversial, as other conceptualizations position brand loyalty as a result of brand equity, which consists of awareness and associations. But when you buy a brand or place a value on it, the loyalty of the customer base is often the asset most prized, so it makes financial sense to include it.

And, when managing a brand, the inclusion of brand loyalty as a part of the brand’s equity allows marketers to justify giving it priority in the brand-building budget. The strongest brands have that priority.

Examples of Brand Equity

Positive Brand Equity

Amazon and Apple are classic examples of brands with positive brand equities. Both Amazon and Apple provide consistent customer experiences, are dependable, innovative, and purposeful, and are integral in people’s day-to-day lives, making them indispensable.

They also deliver on their promises to customers— Amazon provides convenience and industry-leading shipping options, while Apple prioritizes innovation and sleek design. All factors combined, these brands boast positive reputations or brand equities.

Negative Brand Equity

When it comes to negative brand equity, Volkswagen is an example that can be learned from. In September 2015, the EPA issued a notice of violation stating that the brand had been falsifying emissions numbers. As the news spread, Volkswagen lost brand equity, since the public no longer viewed the brand as trustworthy, nor as adhering to its promises to be environmentally friendly.


FINAL THOUGHTS

Brand equity is a key factor in both marketing and business strategy thanks to the idea that brands are assets that drive business performance over time. The equity of a brand is not only a tactical aid to generate short-term sales, but also a strategic support to creating long-term value of an organization.

Learn how Prophet helps businesses build and manage brand equity that drives growth.

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7 Brand-Customer Relationships that Create Loyalty

Love, passion, nostalgia and even intimacy can all deepen the connection consumers feel about favorite brands.

A key to building segments with high loyalty is to create brand relationships that have traction and meaning. To understand relationships, it’s useful to recall the classic work of Susan Fornier going way back to her dissertation in the mid-90s in which she used human relationships as a metaphor for brand relationships. She examined the work of psychologists who studied the nature of relationships and the characteristics of ideal relationships. Drawing in part on this body of work plus her own consumer research, she identified seven types of relationships that are important to understand and had intriguing insights into how brand-customer relationships should be conceived, measured and managed.

These dimensions provide lessons on brand loyalty but come at it from different perspectives. A brand can use them to understand the nature of their customer relationships and how they might expand and deepen them.  The two statements associated with each dimensions provide texture and items for a measurement scale.

The Seven Dimensions of Brand Loyalty

Behavioral interdependence

The degree to which the actions of the relationship partners are intertwined. Indicators are the frequency of interaction and the importance of and involvement in the use occasion.

  • This brand plays an important role in my life.
  • I feel like something’s missing when I haven’t used the brand in a while.

Personal commitment

The partners are committed to each other. There is a desire to improve or maintain the quality of the relationship over time and guilt when it is compromised.

  • I feel very loyal to this brand.
  • I will stay with this brand through good times and bad.

Love and passion

The intensity of emotional bonds between the partners, the inability to tolerate separation, and the reflection of love and passion that exist. In brand relationships, customers can develop passionate links to brands. Substitutes create discomfort.

  • No other brand can quite take the place of this brand.
  • I would be very upset if I couldn’t find this brand.

Nostalgic connection

The relationship is based in part on the memory of good times.

  • This brand reminds me of things I’ve done or places I’ve been.
  • This brand will always remind me of a particular phase of my life.

Self-concept connection

The partners share common interests, activities and opinions. The brand reflects the interests and activities of the person.

  • The brand’s and my self-image are similar.
  • The brand reminds me of who I am.

Intimacy

A deep understanding exists between partners. The consumer will achieve intimacy by knowing details about the brand and its use. One-on-one marketing programs enhance intimacy by fostering mutual understanding.

  • I know a lot about this brand.
  • I know a lot about the company that makes this brand.

Partner quality

The evaluation by one partner of the performance and attitude of the other. The evaluation by the consumer of the brand’s attitude toward the consumer.

  • I know this brand really appreciates me.
  • This brand treats me like a valued customer.

“These dimensions provide lessons on brand loyalty but come at it from different perspectives.”

Read it in Chinese: 7种可以提高忠诚度的客户-品牌关系


FINAL THOUGHTS

It is unlikely that a brand will need or want to gain superiority on all the dimensions. There will be a need to focus. But keeping the larger picture in mind provides more fundamental understanding of the all-important relationship concept.

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New Subcategories: The Path to Real Growth

Subcategory innovators account for a disproportionate percentage of revenue growth and market capitalization.

In my book, Brand Relevance, I argue that the only path to real growth, with rare exceptions, is to engage in transformational or substantial innovation that creates “must-haves” that define new subcategories (or categories). In virtually any product arena that you examine over a long period of time, from water to banking to computers, any growth spurt, (again, with rare exceptions) can be associated with such an innovation. For example, in the Japanese beer market, the market share trajectories changed only four times in over 40 years. In three of those instances new subcategories were formed, and in the fourth two subcategories were repositioned.

In a recent article in the Harvard Business Review, Eddie Yoon and Linda Deeken provide more evidence of this phenomenon. They observed that if you analyze Fortune’s lists of the 100 fastest-growing U.S. companies from 2009 to 2011, 13 of those companies were instrumental in creating a new category or subcategory. These 13 firms accounted for 53 percent of the incremental revenue growth and 74 percent of the incremental market capitalization growth over those three years. Such innovators benefit from higher growth in part because they can expand the marketplace. Chobani, for example, created a new subcategory of thick, creamy, high-protein yogurt that is now in excess of $1 billion in part by attracting new customers into the yogurt world.

These subcategories or categories can be created by substantial innovations that do not alter the basic business model. In the article, Yoon and Deeken point to Sara Blakely’s creation of Spanx slimming apparel and Kevin Plank’s development of Under Armour’s moisture-wicking apparel for athletes, both  $1 billion brands, as examples. Another is Crest’s Spinbrush, which created a new subcategory between the regular toothbrush and the expensive electric versions. All these products use the same marketing and distribution strategy as before, they just now contain a new “must-have.”

A category or subcategory that innovates can also involve a change in the basic business model. Yoon and Deeken describe several examples. Keurig pioneered the “cup-at-a-time” pod-style brewing in the 1990s as an alternative to the existing coffee pot for the office, and later for the home. With a business model around selling K-cups, which come in 200 flavors and sell for around 50 cents, they have created a U.S. business approaching $4 billion. Redbox DVD kiosks, which offered rentals in other stores, were transformational as was Microsoft’s Xbox Live gaming system which added a subscription-based online service to a video game console.

“Firms under-invest in “big” innovation and the product and market research that would support it and over-invest in incremental innovation.”

Transformational innovation can actually be easier to develop and implement than a substantial innovation. You have to have a lot of resources and luck to come up with the innovations that led to Spanx, Under Armor and the Spinbrush. But it just takes insight and creativity to offer a reward program that helps cell phones users in Africa earn life insurance benefits, like MTN. Or for a cell phone maker in China (Xiaomi) sells phones directly by bypassing the telecom firms (think of Dell bypassing the retailers). Both were transformational innovations because they altered the marketplace.


FINAL THOUGHTS

In my view, firms under-invest in “big” innovation and the product and market research that would support it and over-invest in incremental innovation. Yoon and Deeken note that Nielsen’s Breakthrough Innovation Report finds that only 13% of the world’s leading consumer product companies introduced a breakthrough innovation from 2008 to 2010.

It should be more. I don’t know how much more, but more. It is a “big” innovation that moves the needle.

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How Pampers Made Diapers Relevant in China

P&G used a campaign promoting the benefits of sleep to introduce disposable diapers to parents in China.

P&G’s Pampers completely reframed the diaper category in China, and in doing so created enormous growth for the category and for the brand. It is a good example of how focusing on category competition is a better route to growth than trying to win the “my brand is better than your brand” battle. The story is fascinating and informative, not only with respect to framing a category but to entering a new country with a different culture.

Pampers entered the China market in 1998 with a strategy of making a cheaper version of their Western product. The result was indeed cheap, and also was of inferior quality. The product was perceived as plastic and irritating, and it didn’t go anywhere. In 2006 a revised product, called the Pampers Cloth Like & Dry, was soft, effective and half the cost of U.S. versions. But still, sales lagged. The problem was that Chinese consumers were not motivated by dryness or convenience. They did not see a problem that would merit changing their existing habits. But a solution was on the horizon.

P&G was in the midst of in-depth research on consumers that revealed that the quality of a baby’s sleep and its impact on the future development of the baby was a real concern for many parents. This was coupled with the insight that a sleeping baby tended to stimulate a mother’s thoughts of the baby’s future. A study was then commissioned to the Beijing Children’s Hospital’s Sleep Research Center that revealed that babies wearing Pampers fell asleep 30% faster, slept an extra 30 minutes every night, and had 50% less disruption throughout the night.

“Look for a new benefit, application or segment to define a subcategory that will consist primarily of new customers.”

In 2007, Pampers launched the “Golden Sleep” campaign, which included extensive advertising, mass carnivals and in-store campaigns in urban areas. The objective was to frame disposable diapers as aides to quality sleep and to communicate the research data from the Sleep Research Center. The cornerstone of the campaign was getting women to post a picture of their baby sleeping on the Pampers website that would be incorporated into a huge photomontage. Can you imagine the appeal of a sleeping baby? The hook was their goal of beating the Guinness World Record for the largest photomontage in the world. They got over 200,000 responses and indeed used over 100,000 of them to break the Guinness World Record with a 7,000 square foot photomontage that was hung in a retail store in Shanghai.

Sales went up 55% but, more importantly, the category exploded. From 2006 to 2011 the baby disposable diapers market grew to nearly 3 billion, and it’s much larger today. And Pampers continues to be the market leader.


FINAL THOUGHTS

The key is their focus on category competition instead of brand preference competition. Look for a new benefit, application or segment to define a subcategory that will consist primarily of new customers. Make an effort to make sure your subcategory wins.

Competing at the category and subcategory level is the only real path to growth.

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Red Bull: The Ultimate Brand Builder

This brand’s expert combination of sports, events, content and adrenaline bring its positioning to life.

A pioneer in energy drinks three decades ago, Red Bull is now the world sales leader with estimated 2012 fiscal sales of over $3 billion, profits over $400 million, and a 43% leading US dollar market. To establish a new category in the face of Coke and Pepsi and then hold it for decades is very impressive.

Four observations about Red Bull’s unique approach to brand building:

  1. Red Bull’s brand building is largely based on associating its brand with an amazingly wide range of people, teams and events.
  2. Red Bull believes in owning teams and events rather than being one of several sponsors.
  3. Because of this ownership model, they can and have turned this buzz machine into a profit center.
  4. Their on-brand activities reflect two very different personalities that live side by side.

The scope of Red Bull activities is overwhelming. It gets involved in a wide mix of sports such as wakeboarding and motorcycle racing, dozens of Red Bull music events, sponsoring athletes such as motocross racer Ashley Fiolek, teams such as the New York Red Bulls soccer team and much, much more. The Red Bull website has entertainment features such as the Red Bull Soapbox Racer video game, weekly rock music bulletins on the Rock Report, plus sections on movies and TV shows as well. The list of their entertainment features goes on and on and is captured on their Facebook Page, which has more than 37 million followers. With well over 100 potential points of contact, Red Bull will connect to their target market many times, in multiple ways. And more importantly, Red Bull becomes a big part of their customers’ lives.

Red Bull believes in owning teams and events so that they have control over the content and the cost. They do not subscribe to the normal sponsorship model where they would have their name attached to an entity they do not control. They own two professional soccer teams, two Formula One car racing teams, the Red Bull X-Fighters (freestyle motocross) World Tour, the Red Bull Air Race (an international series of air races in which competitors have to navigate a challenging obstacle course in the fastest time), the Red Bull Cliff Diving World Series and much more. Even when Red Bull backs an athlete, they get involved; it is not about a logo on a shirt. Their four-year association with Shawn White, who ultimately won a gold medal in snowboarding at the 2010 Olympic Winter Games, involved building a half-pipe training facility in Silverton, CO, complete with support staff to help him train.

And then there is “The World’s Biggest Jump.” In mid-October 2012, well over 10 million watched Felix Baumgartner rise more than 24 miles above the New Mexico desert in the 55-story ultra-thin helium “Red Bull Stratos” balloon, jump off, and reach 830 mph during a 9-minute fall, setting records for both the height of the jump and the speed of descent. Since then, more than 33 million have watched the YouTube video. With the pre-jump and post-jump news features, videos and documentaries there could have been over a billion quality impressions, which meant an incredible ROI, even though the cost might have exceeded $40 million.

Its ability to stage sporting and music events and manage special athletes means that its rich library of video content will always be fresh and will always be expanding. The Red Bull Media House, launched in 2007, creates and markets new and existing content through TV, mobile, digital, audio and print. For example, the 2011 film The Art of Flight showed hundreds of don’t- -try-it-even-in-your-dreams sequences. There are partnership deals such as the one with NBC, the Red Bull Signature Series, which is made up of 15 events spaced out throughout the year. The brand’s magazine, Red Bulletin has a global distribution of 4.8 million. The media presence is extensive and includes the Red Bull TV channel in Europe and Red Bull documentaries elsewhere. There are versions of content in any length and form. The Red Bull mission, to fascinate, is compelling to content users and audience members alike.

“And more importantly, Red Bull becomes a big part of their customer’s lives.”

Although all the activities are around high energy, there are two brand personalities that live side-by-side. One is the serious athlete excelling in difficult challenges. The other is a fun-loving, humorous, whimsical personality as represented by much of their “Red Bull gives you wings” advertising and humorous cartoon videos on their website.

And have you seen a Red Bull Flugtag? It’s a contest that challenges teams of everyday people to build homemade, human-powered flying machines and pilot them off a 30-foot high deck above a water landing. Entrants are judged not only for their flight’s distance but for the creativity and showmanship of the designs and the people operating them. There are designs stimulated by flamboyant kites, by space-age vehicles and by entities that are, for lack of a better expression, hard to describe.

The first Flugtag took place in Vienna, Austria in 1992, and since then more than 35 Flugtags have been held around the world, attracting up to 300,000 spectators. The record for the farthest flight-to-date currently stands at 207 feet set in 2010 at Flugtag Minneapolis/St. Paul. It is just one representative of the whimsical Red Bull brand personality.


FINAL THOUGHTS

Red Bull is exceptional in telling its brand story in so many compelling, involving ways. And though all of their activity is on-brand, it is far from a “focused” strategy. Taking the next step to building a profit center was not only a smart strategic move, it was the ultimate tribute to their brand-building effort.

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It’s a Trap! Insights Functions vs. Insights Systems

Primary research is great, but it’s just one tool. It’s how companies use insights that makes the difference.

Too many companies fall into too common of a trap: mistaking the difference between an insights function and an insights system. Far too often, companies invest in an insights or research department, or function, only to have its value limited because they are not connected to the broader business.

And more than ever, companies are investing in primary research but getting mixed results. Don’t get me wrong. Primary research is core to being a more outside-in, customer-centric business. However, that’s just one tool – it’s what happens with those insights and who is using them that make the difference. Far too often, this primary research is conducted, summarized to a select set of stakeholders, and then put on the shelf.

An insights function is critical to bringing expertise, discipline and execution to the gathering of insights. However, what sets high-growth companies apart from their peers is having an insights system. An insights system is not bound by functional areas or business units. It is not project-based. It is not a one-way flow of information. Far too often, insights are left at the customer level, not the market level. Or even worse, they are never shared at all.

It is by definition a system. An insights system has on and off ramps for insights. A wide range of stakeholders access and contribute to the system, well beyond the insights or research function. This includes sales and marketing, innovation and R&D, service, engineering and operations, and even partners and principals. Each of these groups has key insights into customers’ needs and behaviors, competitors and ideas for growth.

So, how do you start to build out the system? Market leaders such as UPS, 3M and Microsoft have built their systems by following these proven strategic steps:

  1. 1. Map it. Start by mapping the current flow (or lack thereof) of insights. Where do they go? Who’s contributing them? Who’s using them, and who’s not using them?
  1. 2. Define it. Define what the ideal insight system looks like for your business to drive that outside-in perspective. Where should they come from (i.e., sales, service and market research)? Where should they go (i.e., innovation, marketing and sales)? How should they be accessed (a central repository and/or several strategic forums for insight sharing)?
  1. 3. Educate. Don’t take for granted that everyone starts with the same definition and value of an insight. Leading companies have invested in upfront education and communication about the definition and value of insights to their business under the impressions that more people will contribute to and use them once properly informed.
  1. 4. Build the toolkit. Based on the future insights map you have created, there should be a core set of tools to leverage and/or build. This can include primary research such as quantitative research and focus groups, customer advisory groups, ethnography and usage studies, analytics of customer buying behavior, win/loss analysis, and even listening to contact center calls or complaints on your website. Remember, more isn’t necessarily better. It’s about a core set of tools that give you fresh, actionable insights into your market, competitors and customers.
  1. 5. Make insights core to the conversation. Make insights a baseline expectation for decision-making. Whether it be go-to-market planning, a business case review, an innovation pipeline review or a strategic customer plan, bring insights to the core of the conversation and make this a consistent expectation throughout the business.
  1. 6. Incent to drive the behavior change. To really accelerate the insight system, people need to be incented to contribute insights. The companies that have been most successful building this competency have built this into individual’s performance and incentive plans. It’s become an expectation of virtually all areas of their business.

FINAL THOUGHTS

The answer to insights isn’t always more headcount and bigger budgets in the research group. The path to truly becoming an outside-in company starts with the insight system. It will allow you to more rapidly and consistently identify and act on market opportunities as they emerge.

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Dove: The Most Impressive Brand Builder

This campaign soars on its ability to change the way women are perceived–and how they see themselves.

What are the most impressive brand-building efforts in the last 15 years? In constructing such a list, it would be hard to leave out Dove. A $200 million soap brand in the early 1990s has grown into a brand that has been estimated to be worth nearly $4 billion dollars today. They play in an intensively competitive arena with large, smart and established competitors. And in my view, the Dove brand-building effort played a big role in their success story.

Have you seen the latest from the Dove ongoing “Campaign for Real Beauty” that originated in Brazil and was done by Ogilvy & Mather in 2004? A forensic sketch artist draws several women, first based only on their descriptions of themselves (he does not actually see them) and then based on the descriptions of a stranger who has observed the women. The subject, seeing the resulting sketches side-by-side, realizes that the sketches inspired by strangers are much more flattering than the versions from their own self-descriptions. The tagline? “You are more beautiful than you think.”  The first two versions of these videos each got over 35 million views within two weeks of being posted to YouTube. Thirty-five million!!

Dove’s success is, of course, driven in large part by a business strategy that involved brand extensions, product innovation and geographic expansion. The Dove® Campaign for Real Beauty set out to make women aware that they have real beauty that is not based on the common standard of a young, model-thin body with excessive makeup. The goal was to make a fundamental change in the way that women are perceived and in the way they view themselves. The campaign started with advertisements, showing real women that may have been older or heavier than the “ideal” but exhibited beauty. Billboard ads invited passers-by to vote on whether a particular model was, for example, “Fat or Fab” or “Wrinkled or Wonderful”, with the results of the votes dynamically updated.

The Real Beauty campaign involves substantive programs with girls as the prominent target. Since 2002, Dove has been collaborating with Girl Scouts of the USA to promote self-esteem and leadership programming among tween and teenage girls with programs like uniquely ME! and It’s Your Story – Tell It! An annual Dove Self-Esteem Weekend, started in 2010, aims to inspire moms and mentors to talk to girls in their lives about beauty, confidence and self-esteem supported by discussion aids. The goal is to reach 15 million girls global about self-esteem awareness by 2015.

The Real Beauty campaign resonates at several levels. It connects with an issue of deep concern within the customer base, their appearance and self-confidence. Additionally, it addresses the insecurity and self-esteem issues of young women to which customers could empathize. It strikes a chord. It provides a higher purpose to the brand and a shared interest with customers.

The impact for some of Dove’s efforts has been estimated to be 30 times their expenditure. One of its ads, Evolution, showed how much effort goes behind creating the “model look” and won advertising awards as well as created unpaid exposure estimated to be worth over $150 million. There are anecdotes about dramatic sales increases tied to the campaign and surveys showing that those aware of the effort are more likely to use and recommend Dove products. But the creation of a huge business base is the best evidence to its impact.

“The goal was not to avoid being disliked but to connect to the target.”

The campaign has had its critics, though. In part, this scrutiny has been stimulated by and is a testament to its success and visibility. But during a panel discussion at the WEF at Davos once, Phil Knight dismissed critics to some controversial Nike ads by saying that the goal was not to avoid being disliked but to connect to the target. Exactly.

Dove’s success is, of course, driven in large part by a business strategy that involved brand extensions, product innovation and geographic expansion. The energized brand with its higher purpose and clear value propositions supported by branded innovations simply amplified a remarkable business strategy.

The extension strategy was to leverage the moisturizer heritage of the brand into new categories supported by meaningful innovation. The first extension success was the Dove Moisturizing Body Wash with the innovative Dove Nutrium technology that deposits lipids, Vitamin E and other nutrients onto the skin. This was followed by entries into deodorants, disposable face cloths, shampoos with Weightless Moisturizer, Nutrium soap, and lotions with Shea Butter. Dove also entered the male market with Dove Men+Care. Each extension’s success was based in part on compelling value propositions.

Additionally, an aggressive global expansion resulted in the brand, once a factor in only a few countries, now having a presence in some 80 countries. However, the business strategy would not have had its remarkable success without the brand-building effort to support the offerings and to drive the higher Real Beauty purpose.


FINAL THOUGHTS

The Dove brand success didn’t just happen. It was research-based and employed a host of methods to understand the issues women face with respect to Dove products and perceived beauty. Customer research was supplemented with expert guidance. The Dove Self-Esteem Program, for example, has an 11 person Global Advisory Board. The brand has the ability and the willingness to stimulate, access creative thinking from around the world and then push the best ideas into the marketplace.

Letting ideas emerge and then flourish is not a natural part of most organizations. Dove’s efforts are remarkable.

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Four Disruption Themes for Business

Our research pinpoints 30 disruptions and 15 trends. These are the four to focus on right now.

If you think social was disruptive, it was really just the beginning. Altimeter’s research team recently convened for our annual research offsite and found over 30 disruptions and 15 trends that have emerged. These disruptions and trends will affect consumers, business, government, the global economy; with accelerating speed, frequency and impact.

Four Major Business Disruptions Emerge – Business Leaders Must Prepare.

Out of these disruptions and trends, Altimeter identified four major themes that will be disruptive to business. Below is a preview of Altimeter’s four business disruption themes, with a definition and short description of each. In the coming weeks, we’ll publish a short report explaining these themes in more detail.

Everything Digital: An increasingly digital landscape – including data, devices, platforms and experiences – that will envelop consumers and businesses.

Everything Digital is the increasingly digital environment that depends on an evolving ecosystem of interoperable data, devices, platforms – experienced by people and business. It’s larger than the scope of Internet of Things, as it’s pervasive or ambient – not defined only by networked sensors and objects, but including capabilities such as airborne power grids or wireless power everywhere. Everything Digital serves as the backdrop for our next three themes.

Me-cosystem: The ecosystem that revolves around “me,” our data, and technologies that will deliver more relevant, useful, and engaging experiences using our data.

Wearable devices, near-field communications, or gesture-based recognition are just a few of the technologies that will make up an organic user interface for our lives, not just a single digital touchpoint. Digital experiences will be multiplied by new screen types, and virtual or augmented reality. Individuals who participate will benefit from contextualized digital experiences, in exchange for giving up personal data.

Digital Economies: New economic models caused by the digital democratization of production, distribution, and consumption.

Supply chains become consumption chains in this new economy as consumers become direct participants in production and distribution. Open source, social, and mobile platforms allow consumers to connect with each other, usurping traditional roles and relationships between buyers, sellers, and marketplaces. Do-it-yourself technologies such as 3D printing and replicators will accelerate this shift, while even currency becomes distributed and peer-to-peer-based. In this new economy, value shifts towards digital reputation and influence, digital goods and services; even data itself. The downside? An increasing divide between digital “haves” and the digital “have-nots.”

Dynamic Organization: In today’s digital landscape, dynamic organizations must develop new business models and ways of working to remain relevant, and viable.

Business leaders grapple with an onslaught of new technologies that result in shifting customer and employee expectations. It’s not enough to keep pace with change. To succeed, dynamic organizations must cultivate a culture, mindset, and infrastructure that enables flexibility and adaptability; the most pioneering will act as adaptive, mutable “ad-hocracies.”

Altimeter’s Disruption Database

Below are the 30 digital disruptions and 15 digital trends, which were used as the starting ground of our analysis.


Disruptions

Trends

3-D Printing and Replicators App Economy Artificial Intelligence (AI) Augmented Reality (Google Glass) Automated Life (Cars, Homes, Driving, etc.) Automated Robots Bio-Engineering Biometric Authentication (Voice/audio, fingerprint, body/eyescan, gesture, olfactory user interface Content Marketing Digital/Social TV vs. “Second Screen” Emerging Hand Held Devices / Platforms (Android, Tablet, Phablet) Gamification Gesture/Voice-Based Interface/Navigation / “Human as Interface” Hacking/Social Engineering and Information Security Haptic Surfaces (Slippery, wet, textured through electrical currents) Healthcare – Data and Predictive Analytics Human-Piloted Drones Hyper-Local Technology / Mobile Location / Indoor Mapping Internet of Nanoparticles (Embedded in bloodstream) MicroMedia Video Mobile Advertising Mobile Payments Native Advertising Natural Language Processing Near Field Communications Open Source / Open Data / Open Innovation Peer-Based Currency / Soical Currency (BitCoin) Proximity Based Communications Social Engagement Automation (Robots Respond on Twitter) Social Network Analysis, Graphing, and Data Science Social Technologies Touch Permeates Digital/Surfaces: TVs, Touch Advertising Virtual Reality / Immersive 3D Experiences Wearable / Embedded Technology Wireless Power / Electricity

Big Data Collaborative Economy Connected Workplace Customer Experience Design/Architecture and Integration Data Convergence/Customer Intelligence Data vs Creative in the Org: New Decision Process Digital Ethnography or Customer Journey Mapping Digital Influence and Advocacy Evolution of the Center of Excellence Generation C Hypertargeting Internet of Things or Internet of Everything Intrapreneurship, Innovation Culture, and Innovation Hubs Pervasive Computing Porous Workplace Privacy: Standardization and Regulation (“Beware of Little Brother”) Quantified Self or Human API The Digital Journey and Understanding Digital Signals The Maker Movement The Neuroscience of Digital Interactions


“These disruptions and trends will affect consumers, business, government, the global economy; with accelerating speed, frequency and impact.”


FINAL THOUGHTS

Please Share Your Comments and Insights with Us.

There’s more to come – we’ll be sharing additional insights such as
1) top questions for businesses to ask,
2) who’s disrupted and who benefits, and
3) enabling technologies. In the meantime, we’re soliciting your comments as part of our Open Research model.

Please share our themes with others, and help us answer these questions:

  • What other business disruptions or trends are you seeing? Please add to this Google form and we’ll provide proper attribution.
  • Which of these four business disruption themes impact your business now?
  • How is your business responding to these themes, or the related disruptions and trends?

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How to Identify Your Brand Personality

Sincere or sophisticate? Rugged or sweet? The right personality communicates benefits and drives engagement.

My last blog post, “Three Models of How a Brand Personality Impacts,” discussed three ways in which a brand personality can impact customers and the marketplace. And its reception, measured by views and comments, indicated that brand personality is a highly sought after and intriguing concept. Many recognized brand personality as a key brand vision lever for brands that are facing dynamic markets and a fragmented media presence. A brand personality can be a crucially important driver of self-expressive benefits, brand-customer relationships and the communication of functional benefits.

If a brand strategist wants to explore the potential of creating or enhancing a brand personality, then they have to address one basic question.

What should my brand personality be?

One place to start is by deciding which personality elements should be on the table. My advice? To start with an established brand personality scale designed to span products, much like the scale developed by my daughter, Jennifer Aaker. It contains 15 traits organized into five factors as follows:

  • Sincerity—down-to-earth, hones, wholesome, cheerful
  • Excitement—daring, spirited, imaginative, up-to-date
  • Competence—reliable, intelligent, successful
  • Sophistication—upper class, charming
  • Ruggedness—outdoorsy, tough

This can provide one checklist. Which of these 15 traits or variants would work?

A second source of ideas comes from looking at other brands inside or even outside of your category that are admired or relevant and ask some basic questions. What is their personality? How strong is it? How was it created and maintained? In what way does it enhance the brand or the marketing program? An airline like Emirates, for example, could look at hotels, financial services firms or online retailers for brand personalities that stand out and are advancing a business strategy or brand.

“A brand personality can be a crucially important driver of self-expressive benefits, brand-customer relationships and the communication of functional benefits.”

A third vehicle is to look at the “three models…” concept from my last post and examine whether any of these three could be relevant in your business context. They can be the source of ideas for brand personality elements as well as serve as criteria to select from.

Finally, the brands and their offering could be appraised to see what personality elements, if any, are already prevalent. What elements could be compatible with existing image and relationships? It is much easier and less contrived to build on an existing or embryonic brand personality than to try to create one from scratch.


FINAL THOUGHTS

In selecting your brand personality, several criteria should be employed. First, the personality should have a role in advancing the business strategy and the brand. You don’t want to have a personality just to have one. Second, the personality should appear authentic and not contrived. It should be backed up with substance in the form of value propositions and customer experience. And finally, there should be programs in place that will bring the personality to life so that it will not be an empty aspiration.

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Three Models of How a Brand Personality Impacts

Whether it’s warm or witty, outdoorsy or urbane, your brand’s personality is a valuable communication tool.

What is the worst thing you can say about a person? That they have no personality. Who wants to spend time with someone who is so boring that they are described as having no personality? It’s better to be a jerk; at least you will be interesting. Having a personality is equally helpful to brands.

Not all brands have a personality, or at least don’t have a strong, distinctive personality. Those that do have a significant advantage in terms of standing out from the crowd, having a message and supporting a relationship with customers. Personality is an important dimension of brand equity because, like human personality, it is both differentiating and enduring. Once established it will provide benefits (or harm) over a long time horizon. Creating or supporting a personality should be part of the brand vision discussion.

The power of brand personality can be seen by conceptualizing three models of how personality impacts:

The Self-Expression Model

People express their own or idealized selves in part by the brands that they buy and use. Using Apple’s MacBook expresses for some a non-corporate, creative self-based in part on the perception that Apple-as-a-person is an unpretentious, irreverent and somewhat off-the-wall person. The use of Betty Crocker expresses the homey, maternal, nurturing side of some of its users because Betty Crocker-as-a-person is a mother figure who is traditional, small-town, and all-American, a person that cares about cooking and about her family. Wearing the Nike brand is a personal representation of an active lifestyle personality for many. Nike-as-a-person is exciting, provocative, spirited, cool, innovative, aggressive, and into health and fitness. A brand can serve as a person’s personal statement even if that person were stranded on a desert island.

“Personality is an important dimension of brand equity because, like human personality, it is both differentiating and enduring.”

The self-expressive power of the brand can depend on the context. One study suggested that a brand personality can transform the use experience by creating feelings during use. Respondents were asked to project themselves into one of two scenarios. One involved a break after a daytime hike on a mountain, while the other was during a small evening barbecue with close friends. During the scene, the beer served was either Coors or Löwenbräu. Coors, with its outdoorsy, active, healthy personality, created feelings of “warmth,” “friendliness,” and “wholesomeness” in the mountain setting, but not in the barbecue setting. In contrast, Lowenbrau, with a warm, social personality, the reverse was true.

A brand can serve as a person’s personal statement even if that person were stranded on a desert island. However, there are socially visible or “badge” brands, particularly for statement products like cars and clothes, that have substantial social impact and thus enhance to a self-expressive brand role. Driving a Prius or Mercedes provides a self-expressive benefit that is extenuated by an awareness that others will observe.

The Relationship Basis Model

A trustworthy, dependable, conservative personality might be boring but might nonetheless reflect characteristics valued in a financial advisor, a lawn service, or an auto brand such as Volvo. The concept of a relationship between a brand and a person, analogous to that between two people, provides a different perspective on how brand personality might work. For example, consider the following relationship metaphors:

  • A weekend fun companion: Pepsi might be better than Coke if perceived as a fun, energetic, social person.
  • An old-fashioned mother: A down-to-earth, honest, genuine, reliable, always there for you personality brand like Campbell’s Soup or Pepto Bismol might fit.
  • A well-liked and respected family member: Warm, sentimental, family oriented, and traditional personality linked to growing up. Think of brands such as Hallmark, Kodak and even Coke.
  • A person who you respect as a teacher, minister or business leader: An accomplished, talented and competent person as represented by IBM or the Wall Street Journal.
  • A boss who exercises power or a rich relative: A pretentious, wealthy, condescending personality perhaps reflecting the personality of BMW, Mercedes or Lexus (with gold trim).
  • A companion for an outdoor adventure: An athletic, rugged, and outdoorsy personality such as Nike or Wells Fargo.

Think of a brand relationship that involves two-way communication. What might a brand say to you? One customer segment who perceived a credit card brand as sophisticated, educated, a world traveler and confident believed that the card would make comments like:

-“My job is to help you get accepted,” and

-You have good taste.”

A second, “intimidated” segment who considered the same credit card brand to be sophisticated and classy but snobbish, aloof and condescending believed the card-as-a-person would make comments such as:

-“I’m so well known and established that I can do what I want.” and

-“If I were going to dinner, I would not include you in the party.”

The user segments had remarkably similar perceptions of the brand, but the attitude of the brand toward the customer was a big discriminator and the relationship metaphor helped provide that insight.

The Functional Benefit Representation Model

A brand personality can also be a vehicle for representing and cueing functional benefits and brand attributes. It can be easier to create a personality that implies a functional benefit than to communicate convincingly that a functional benefit exists directly. Further, it is harder to attack a personality than a functional benefit. Consider:

  • The Harley Davidson-as-a-person rugged, macho, America-loving, freedom-seeking individual who is willing to break out from confining society norms of dress and behavior suggests that the product is powerful and is a bike with substance.
  • The Hallmark-as-person is sincere, sentimental, warm, genuine, wholesome and ageless as well as being competent and imaginative. This says a lot about the Hallmark offerings.
  • The Benetton-as-a-person is daring, trendy, exciting, provocative, spirited and imaginative, and this affects people’s perceptions of Benetton and its stores.
  • Michelin as reflected by the Michelin Man has a strong, enthusiastic, energetic personality that suggests a tire with strength and energy.
  • Wells Fargo, as represented by the stagecoach, reflects an independent, cowboy type that delivers reliably. Although competitors may actually deliver superior reliability and safety of assets, because of the stagecoach, Wells wins the battle for perceptions.
  • The Energizer rabbit is an energetic, upbeat, indefatigable personality who never runs out of energy–just as the battery runs longer than others.

FINAL THOUGHTS

A brand personality can be a vehicle to express a person’s self, represent relationships, and even communicate attributes. In doing so, it can provide a point of differentiation and energy that is sustainable, because it’s very difficult and usually ineffective to copy a personality.

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