Thursday, 30 July 2009

The Multi-branded approach

Welcome to my fourth blog post!

We recently finished a fabulous but exhausting logo design process – thanks to everyone who voted! We received and commented on over 1000 logo designs and I could never have anticipated having seen our "name" written in so many ways. It was awesome to work with over 100 designers from all over the world – all giving it their best shot! I would recommend this process to anyone – but remember to set aside the time – or employ someone to be interactive with the designers – they cannot produce what you want unless you are involved. It was also incredibly interesting to see how our "brief" changed over the 7 days. It is crucial to keep an open mind when having a logo designed – if you aren't – you could miss out on so many fabulous ideas you never dreamed possible – and that, my friends, is completely your loss. But that's for a future blog post. Yes - that was subtle marketing :-)

Onto the multi-branded approach – shall we? I'll use this term throughout because I feel it best describes what we are talking about – multiple brands in one strategy. Just know that there are many different 'names' for this approach – this just happens to be my personal favourite.

Multi-branding allows the holding company all the possibilities in the world when expansion is a key focus and cost is not a factor. Some examples are: Unilever, Proctor and Gamble and the Santan Der Group amongst many. A company can have varied products with varied lines under them, e.g. – most people are unaware that Unilever owns a variety of washing powders on the shop shelves, all separately positioned for different markets, with different values and selling points. It is not unusual with this approach to produce competing products in the same market – why – so that you can 'own' the markets, without being in your face about it. Some of the brands that use this approach have taken choice to a whole new level. A consumer looks at the shelves and feels as though they have this fabulous choice of product and if a certain brand becomes contaminated or a consumer doesn't like one of their brands, for whatever reason, they still may not lose that customer to a competitor because of their fall back brands.

The most obvious negative of this approach is the cost! It is very expensive to promote multiple brands and the performance of the products and services need to be monitored closely to ensure they are bringing in what they are spending to be alive or it is time to cut the product. This approach can be highly successful if each Brand is strong enough to support itself entirely and has a healthy advertising budget to boot. It is an extremely competitive market and not for the faint hearted. You are spending money just to fight for market share with another one of your own products - is it a brilliant or very expensive way to keep your competitors at bay? Probably both of those combined...

cozwecan.com does not really lend itself to being a multi-branded entity because we feel all the brand names are too similar – it wouldn't take a rocket scientist to figure out that pix.cozwecan.com and somethingelse.cozwecan.com are sister sites. So perhaps our fate is the Endorsed Strategy? We'll find out next week...have a good one!

Frankie

Wednesday, 22 July 2009

Dialogue v Monologue

Well, I'm sure I was going to elaborate on exit strategies and how not to get burned, but I read an interesting article in the McKinsey Quarterly that I thought was rather interesting, especially given what we've been doing over here in cozwecan. Donna Hoffman from The Sloan Centre for Internet Retailing wrote about how companies are still wrapped up in talking at customers and consumers, rather than listening to them - a monologue as opposed dialogue. Now as all Americans know, no idea is worth it's salt unless it has a snappy acronym, and on this point Donna doesn't disappoint: her model is tagged LEAD: Listen, Experiment, Apply, Develop. In other words, how do companies influence the flow of information relating to their business when the information is longer owned or controlled by them, but rather shared amongst consumers. So what does it all mean, and why is it relevant to cozwecan?
 
Firstly, we should all have our ears to the ground and listen out for what people are saying about our companies. It's no good shouting from the rooftops these days as no-one pays any attention - in fact, consumers are far less likely to believe what you have to say about yourself than they are those within their social sphere, or graph. A case in point is our crowdsourcing experiment in sourcing a logo and putting it to the popular vote: it's less about what we think and more about what our future customers think.
 
We also need to experiment, and it's more about tactics than strategy: social media is an ephemeral thing, and if you debate for too long as to whether you should jump in or not, you'll fast become the kid still using a piece of string attached to two empty cans rather than the latest iPhone. The beauty of social media is that you get to be where your consumers are, and the only way you'll get to be trusted is to be out there, warts and all.
 
Whatever you learn, make sure you apply it to the rest of your business, such as optimising your site for social network sharing. It's no good engaging with your customers only to have them disenchanted when they get to your website.
 
And finally, make sure that the Internet and social media becomes the dominant factor in your marketing mix.
 
Now I know none of this is particularly revolutionary, but it struck a chord for me, no doubt because our website is pure web 2.0 - the incubator of social media - and that we've experienced our first taste of consumer engagement. And speaking off incubators, I'm off to the birthplace of web 2.0 - San Francisco and Silicon Valley - for a couple of weeks, so no boring posts from me until I get back...
 
Cheers

Wednesday, 15 July 2009

Branding Approach: Let's get Monolithic

Hello again

I firmly believe that it's more important to own markets than to own products and the only way to own markets is to own dominant brands. Branding a new company is often a very exciting project and should be enjoyed from the word go! Once you know the rules of engagement it is a very simple game to play.  An overview of the different branding options a company has available to them is an invaluable exercise, so without further ado:

Monolithic Strategy:

"Mono", meaning "one", markets one brand only. Some examples are: IBM, Google and Microsoft. Some plus's of this approach are; the ability to create a strong brand identity; minimises confusion; reduce proliferation (many brands equal many strategies) and it is the most cost effective route.

I must warn anyone reading this, that even if you need to be frugal due to financial constraints, budget is not a good reason, nor will it ever be, to go this route. One of the aspects of this approach can either be seen as a negative or a positive attribute, depending on your brands' need. This is that all of the products need to have a single minded message that can be put across to an audience and whatever products emerge will all have to have the same message to convey. The good part is that any investment made through communications or research will benefit all of the products or services. The bad part – can all your services and products deliver this message? The answer to whether this will work for you will largely depend on what your product or service is. Can they be marketed together? Do they all have the same values like 'quality' or 'prestige' or 'reliability'? If not, then I highly recommend you go for a multi-branded or endorsed strategy and just make every penny count.

The biggest negative to worry about, marketing wise, is if one of the products or services isn't operating correctly, its performance can contaminate the values across the entire brand. If Volvo had to make a potentially dangerous car, like a sports car and it emerged that the cars where a hazard to own because they were badly built, the entire brand would be crucified and sales across the board would most probably drop.  Even though Volvo have spent so much time and money on positioning themselves in people's minds as "the safest car on the road", people are generally fickle, and will more often than not begin doubting the brand integrity as a whole and not just that of the sports' 'version'.

cozwecan.com does not typically lend itself to a monolithic structure because then we would have to direct people to cozwecan.com to click through to their preferred service or product site which we feel is a wasted 'extra' step in a customer's already busy world. This is not to say that people won't be able to go to cozwecan.com and click through to the sub sites, but it will more than likely not be marketed that way.

It could also not really fit with this structure (even though anything can be squeezed) because we know from the outset that it will comprise of many different products and services that would often be too different in nature to keep under one umbrella. cozwecan.com will have a common vision and statement, but the products may all need individual treatment.

That's all for this week!  Next week I'll be exploring the world of the multi-brand approach.

Have a great week.

Frankie

Monday, 6 July 2009

Planning your exit before you burn

Ever sat on a plane during the safety procedure announcement and paid little or no attention? Yip, thought so. The reason we choose to ignore this is twofold: one, we don't really think it's not going to happen to us, and two, we've heard it all before and know what to do, right? Right…
 
The fact remains that a significant number of start ups don't get to enjoy a second Christmas party, and you need to consider what events (or "triggers") will cause you to exit the business ("OMG, the engines are on fire"), how you will exit ("If I can climb over this fat guy, I reckon I can make it to the emergency exit first…"), and what you'll do next (after the adrenaline rush of the emergency slide).
 
Now there are clearly hundreds of potential triggers, and it's up to you to try and anticipate what they could be and how you'll react if they occur. By visualising the potential triggers, not only will you be better suited to deal with them, but you'll also be less emotional and more rational. So, without boring you with an endless (and quite frankly, off putting) list of potential pitfalls, the most common include:
 
  1. Poor market research leading to unrealistic expectations of world domination
  2. Realising that while the idea sounded great at the pub, your level of expertise/knowledge/experience isn't quite good enough (no, scribblings on a beer mat do not constitute a solid business plan…)
  3. The cost of setting up a business and keeping you in beer money are at odds with one another (the need for beer money almost always wins, which means going back to being an employee), which means
  4. You spend the marketing budget on beers. The result is that no-one knows what you do. Not even your mum. And no, just because you've built something doesn't mean they will come…
  5. You get bored with the endless cycle of working hard for no money. And even if the recent shenanigans of financial institutions has turned you into a Marxist, the novelty of endless graft for no crust will soon wear off. Trust me.
  6. You sound the rallying cry, but when you turn around mid-charge, you notice you're on your own and that your business partners have decided that discretion is the better part of valour.
  7. Finally, you are in fact a genius, you've surrounded yourself with geniuses, you have a fantastic product at a great price that you've marketed brilliantly and someone makes an offer to buy you out.
So, regardless of whether you jump on your own accord, or are thrown unceremoniously by the vicissitudes of the market economy, your departure from the business needs to be pre-planned. As I mentioned earlier, there are a multitude of potential triggers, but they all lead to the same question: how does one exit quickly and cleanly.
 
So, next week I'll discuss more specifically the potential triggers we're facing at cozwecan, and the various exit strategies we're considering.
 
Cheers
 
Paul

Saturday, 4 July 2009

More on Branding

Brilliant Design will bring with it a recognisable "face" which we will nurture into a Brand. You can never pay enough for creative design, so let's not short change 'the creatives' – they don't take kindly to it. I wonder if the people who created the 'Google' (brand value in 2008 around $86m); Microsoft (BV in 2008 = $70M$) and Coca Cola (BV in 2008 = $28m) thought their 'designs' would be worth so much.

I once read somewhere that "The Bitterness of Poor Quality is Remembered Long after the Joy of Low Prices" and I have to agree whole heartedly. When clients' say to me, "How can you charge me that for a logo design or ad", I just want to cringe. Regardless of the fact that I know I am "cheap" by all accounts, I know that if they don't have the money to make the logo or ad they certainly will never have the money to 'flight' the ad or promote their brand in any significant way so as to improve its worth. Great natural 'creatives' are hard to find and every Tom, Dick and Harry coming out of a quick design course ends up thinking they are now a 'creative' when they actually haven't a cooking clue as to what they are doing. Being able to operate a design program is not an automatic qualification as a "creative".

Brand Loyalty = Profitability. This is why we all work, isn't it? We want to be profitable. The most important asset of a company should be their brand. Having said that, it goes without saying, that you should be prepared to spend money promoting and refining your brand over time. There are many instances where a brand is equally as important as a product and Coca Cola is a wonderful mix of brand and blend.

The Coca Cola brand is super powerful, but it's an equal mix of taste that keeps it alive. According to The South African Advertising Book, when Coca-Cola launched New Coke in 1985, their customers were furious and used the 1-800 number Coke had established, to let them know just that. The normal volume of calls were around 400 a day and right after the launch this jumped to 12 000 with most people saying they enjoyed the old taste. Coke responded immediately by re-introducing Classic Coke and about 18 000 American consumers responded by calling in to say Thank You. That's Brand Loyalty. Coca Cola had the foresight to realise that the 'Coke' brand and how it tasted actually belonged to the consumers, whether they liked it or not and chose to respond immediately instead of being arrogant enough to think that the people didn't have a choice and would have to get used to it.

Marketing is a battle of perceptions and a brand should represent a holistic concept bought by the customer, be unique and timeless, with its own personality and have a guarantee of consistent quality. I hope I have made it clear enough how strongly I feel about developing a Great brand.

The logo design challenge:

Every brand has a "face", AKA, a logo. We have opted to use "crowd sourcing" for the design of our logo. What's does this mean? It means we are using a pool of talented designers who will compete for the prize (money) by designing a logo to our brief. Although there are a number of these available online, after careful consideration, we are going with 99designs.com. Please feel free to have a look and comment on the designs that come out in the next week or so. You never know, you may have a hand in helping design a famous logo!

Over the next few weeks I'll take a look at the different branding structures available to companies and which one we chose and why.

Thanks for reading, catch ya next week.

Frankie