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Fun with Brand Tags

24 Jan
Volvo Brand Tags

Volvo: boring and boxy (but good)

Occasionally, when I’m tired of doing anything vaguely productive, I wander over to brandtags.net, where I inevitably waste more time than I intend to. You may have visited brandtags.net already . It’s been around a couple years and has been written up by lots of folks — Wall Street Journal, Ad Age, ClickZ, Seth Godin, among others. If not — and if you don’t mind losing yourself for a while — give it a whirl. It’s both a running compilation of the perceptions of various well-known brands and an engine for you to input your own instant perceptions of whatever brands the site throws your way:  sort of a brandophile’s Rorschach test. (Quick, how would you describe this brand in a word or phrase: Suzuki?) The site now has over a thousand brands tagged with over two million tags, which appear in cloud formation (like the one at left for Volvo), with the descriptions in size proportion to the frequency of their usage.

So here’s some interesting stuff I learned in a few minutes on Brand Tags about luxury automobile brands:

  1. “Asshole” seems to be about as important an element of the BMW brand as “Engineering,” “Performance,” “Overpriced” and “Snob,” though not as much as “Ultimate Driving Machine” or “Yuppie.”
  2. Mercedes evokes “Prestige,” Luxury,” “Overpriced,” “Expensive,” and “Nazis.” BMW seems to have a Nazi element, too, but not as strong as Mercedes; go figure.
  3. Cadillac combines elements of “Classic,” “Expensive,” “Luxury,” “Grandpa,” “Old People,” and “Pimp.” Draw your own conclusions.
  4. Audi? “German,” of course. “Luxury,” “Performance,” “Sleek.” And how about this — “Olympics?” Seems their  logo has made a real impression. (“Star” was significant for Mercedes, too.)

Restaurants are fun, too:

  1. Boston Market? “Chicken,” “Food,” “Meat,” “Turkey,” “Yuck.”
  2. Burger King ranges from the obvious — “Hamburgers,” “Fries,” “Junk Food,” “The King,” etc. — to the unsettling “Creepy King” — to the ancient — “Have It Your Way.”
  3. Here’s a fun and popular association with Dunkin Donuts: “Cops.”
  4. I guess it’s no surprise “Shit,” “Obesity,” “Disgusting,” and “Yummy” rate high for McDonald’s. But “Evil?” That’s harsh.

What does it all mean?

  1. For starters, it confirms what we know — that brands over time become extraordinarily rich stews of impressions and perceptions: positive, negative and lots of in between. Those stews ARE the brands. They grow in directions we simply can’t control. If you’re McDonald’s, “Disgusting” is apparently a side of your brand — albeit the dark side. If you’re Dunkin Donuts, you need to accept the popular perception that you’re the place cops hang out. If you’re Mercedes, “Nazis” is something you’d consider unwarranted and irrelevant 65 years after the fall of the Third Reich. But it’s no less real for that — perception in brands is reality. And that reality is constantly evolving as new perceptions enter the mix and old ones either evaporate or grow in intensity. In case we didn’t know it, managing brand perceptions is a 24/7 job, not simply a campaign or three.
  2. How we brand and communicate makes a difference. Can you believe how vital “Have it your way” still remains for Burger King? Or how important “Engineering” is for BMW, but not for any of its competition? Those are significant brand advantages that grew directly from the product, to the communications, to perceptions. Look at the brand tags for a brand like Boston Market, which has deep penetration and has been around for a while — there are almost no perceptions beyond the most basic (“Chicken,” “Meat,” etc.). Could it be because they’ve never planted any with their communications? Could this be one reason for their struggles?
  3. The brand experience itself communicates more strongly than anything we say. No amount of communication seems to be able to erase the memory of experiences. Communications can effect the perceptions of those experiences. But they can’t delete them.

Fun, huh? Of course, there is not explicit connection between brand tags and a brand’s success or lack thereof. But if you’re looking to spend a little quality time in Brandland, check it out.  And if you register, you’ll be able to play “Guess That Brand,” where you’re presented with a set of brand tags and have to figure out which brand they are for. I found it very humbling.

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A Restaurant’s Guide to Groupon, Part Two

14 Jan

A few weeks ago, I wrote a post about Groupon, based on a nice piece of research by Utpal M. Dholakia. I did that because a lot of clients ask us about Groupon (and LivingSocial and Restaurants.com and others) and — let’s face it — there’s just no avoiding it. To my mind, Groupon and the others are nothing more than a new generation of ValPac and Valassis, which were themselves a new generation of targeted promotional media in their day. People will always love a deal. Retailers and restaurateurs will always want warm bodies in their establishments. Entrepreneurs will always be finding new ways to put those facts together for their own profit. It’s up to marketers to figure out what works for them.

Now a new paper has been published by the Harvard Business Review that furthers our knowledge of how Groupon and other deep discount vouchers work in the marketplace. In it, the authors develop a model to explore how consumer demographics and offer details interact to shape the value of voucher discounting. Here are a couple main findings and how they affect restaurants interested in Grouponing.

First, “discount vouchers can facilitate price discrimination, allowing merchants to offer discounts to customers who value the merchant’s product less than ordinary customers do.” In other words, Groupon and others encourage trial by those who simply won’t pay your prices. That’s a good thing if their experience is so good they can establish a strong connection between your price and their pleasure and/or your margins are high enough to scrape adequate profit from the voucher users and/or the Grouponers who show up aren’t already customers. That’s a lot of ifs, ands and ors.

Second, “discount vouchers can benefit merchants through advertising, by informing consumers of a merchant’s existence. For these advertising effects to be important, a merchant must begin with sufficiently low recognition among prospective consumers.” Obviously, Groupon and others offer an opportunity to introduce yourself (or reintroduce yourself) to a potential customer. But it comes at a cost. Groupon’s seductive business model — no money down, proceeds from Groupon sales split 50/50 with the merchant — can mask the true cost in lost margin. Giving that margin away to current customers just doesn’t make sense. So if you’re already well-known, but just want to generate a little more sales volume, find a different answer.

So again, the question must be asked: to Groupon or not to Groupon? The answer is yes, if:

  1. You need a big awareness bump at any cost. New restaurants or restaurants that can’t seem to get over the hump may need a jump start. Groupon’s ability to reach many people and induce trial can be very powerful. But it ain’t free.
  2. Your margins are high enough to take a battering. For most restaurants this probably won’t apply. But some have begun raising prices to allow space for deep discount vouchers. In the short term this can look attractive. But it’s no way to build a brand.

Above all, if you do choose to go Groupon, make sure your system for collecting customer data is in place. If you don’t take responsibility for bringing the Grouponers back, you may never see them again.

You want brand experience? Uncle Teddy’ll GIVE you brand experience, hon!

3 Dec
Chick and Ruth's Delly

Chick and Ruth's Delly. Starbucks it ain't.

You don’t really walk into Chick and Ruth’s Delly (yes, that’s the way it’s spelled), you kind of sidle or crabwalk your way in, mumbling “scuse me, ‘scuse me” to the folks dining at the little cafe tables cluttering up the entrance. Welcome to a brand experience extraordinaire, courtesy of the little red-haired guy in the black vest and newsboy cap.

Uncle Teddy, as everyone knows him, is a brandmaster who could teach us all a thing or two. By understanding his brand inside and out, and living it to the hilt every day, he’s created an Annapolis institution. Indeed, on a weekend morning, it’s hard to avoid being stopped on Main street by tourists with the question, “Is there a Chicken Ruth’s on the street somewhere?”

Pledge of Allegiance

The daily Pledge of Allegiance

The brand experience starts with the food, of course, a diner style cornucopia of hearty breakfasts; delly sandwiches with local politicians’ names (The Sen. Barbara Mikulski is tuna and melted cheese, served open face on a bagel); wraps; salads; soups; pizzas, burgers; appetizers…well, you get the idea, it’s just about anything you could imagine, most of it straight off the griddle. To be honest, the food is not why most people are here, though it is hearty and Adam Richman from Man Vs. Food did come here to challenge the Colossal Burger and Shake.

1931 Faces of Valor Buick

Uncle Teddy's 1931 "Faces of Valor" Buick

No, the food isn’t great (sorry Uncle Teddy), but the experience is one you can only get here. Let’s call it an Annapolis/American dining experience as seen through the looking glass. Remember, the place is only a block away from the oldest Statehouse in continuous operation in the nation, just a couple blocks from the U.S. Naval Academy, and up the street from Ego Alley, a little Chesapeake port where cruising sailors from all over the world dock their boats. So the clientele is varied, to say the least — suited politicians, uniformed midshipmen, bermuda shorted tourists, boater-shod townies, grizzled sailors. What Uncle Teddy serves up is The Pledge of Allegiance, announced over a megaphone every morning at precisely 7:30, old school waitresses in old school black and white uniforms who will call you “hon”, walls completely papered with yellowing photos and newspaper articles, the smell of sizzling grease and the hum of happy customers. Out front may sit Uncle Teddy’s 19312 “Faces of Valor” Buick, which he created with his own two hands. As a brand experience it is the equivalent of stepping into Uncle Teddy’s own excessive, imaginative, inclusive, American brain. it just happens to be in “delly” form.

I’m writing about Chick and Ruth’s to make a simple point. Great brands aren’t necessarily great big. They aren’t even necessarily well-designed; Chick and Ruth’s is hideous really, a designers worst nightmare, except for the fact it’s oddly beautiful. But to understand what makes a brand consistent and special, one need only walk into Chick and Ruth’s with an open and enquiring mind and to realize that sometimes restraint is not such a good thing. If you are starting from a consistent vision, maybe it’s best to let ALL of your ideas out, to let all of them have their day in the sun. Maybe that’s what can make a brand truly alive, the way Chick and Ruth’s is alive.

Thanks Uncle Teddy.

 

Interested in franchising? Be careful with your name!

22 Nov

I took a meeting the other day with an erstwhile restaurant franchiser who was eager to take her first steps toward becoming the next Panera Bread. Let’s call her “Fran.” Fran’s restaurant was hopping, people were raving about the food all over Yelp, and with a little polish her brand concept could be different than any other out there. So she was ready to make it happen, right?

Wrong. She didn’t have a trademarked name. What’s worse, the $450/hr. IP attorney we’d invited had serious doubts about whether she’d ever be able to trademark her current name. And why is a trademark so important? Because without it, Fran has nothing to franchise. What budding franchisee wants to plunk down $300k+ to open a restaurant that could be the subject of a cease and desist letter or worse?

Now this isn’t a total show stopper. It’s not impossible to create a new name, logo and all the trade dress that goes with it. But who wants to lose the hard won equity in the name they invested in from the get go? And renaming isn’t easy, either. Especially in a world where it’s becoming more difficult by the minute to find a name that’s not taken. Just ask the folks at Panera Bread, who when they started franchising had to drop their St. Louis Bread Company name (too generic) to become Panera .

So if you believe you will ever be interested in growing out of your single location, take some time to start with a name you know you can keep. Here’s how:

  • Create a few names that fit your brand and aren’t generic, i.e. they aren’t just based on a place (like St. Louis Bread Company), a common dish (The Spaghetti Place), or a type of establishment (The Bistro). This sounds easy, but it’s not. In fact, many words have been written about what makes a good name and how to create one. I’ll spare that discussion for another time. (But if you want to check a couple cool sites about naming, try these: Igor and The Name Inspector.)
  • When you have a few names you think might work, do some quick searches in the U.S. Patent and Trademark Office’s online Trademark Electronic Search System (TESS). It’s not difficult. If you see any of your names on the list, get rid of it.
  • One hopes after this exercise you have at least a couple remaining acceptable names. Now it’s time to bite the bullet and get an intellectual property (IP) attorney to help you. I say this with full knowledge that there are ways to do it yourself and plenty of online services that say they can make it happen for a couple hundred bucks. I have seen those methods work. But I have also seen disasters. Please, hire an attorney.
  • The first thing the attorney will want to do is conduct a global search, probably through a company called Thomson Compumark. It should cost less than $400. Do it.
  • Within a couple weeks, the attorney should have a very good idea of the availability of your names. Assuming you have at least one option, you ought now to feel comfortable dressing your new name up in a logo (with a ™ to protect it until your registration passes) and moving ahead with your plans.
  • It will take a few more months for the attorney to file paperwork and for the USPTO to register your name (at which time you can switch to a ®), but you should be home free.

Total cost for this whole operation should be less than $2,000. That’s not inconsiderable for a start-up. But before you take a short cut, consider our friend Fran, who is now looking at starting all over again. Seriously, do it right.

A Restaurant’s Guide to Groupon: Do it Right or Not at All.

19 Nov

I usually write about branding in this space. But at one time or another every brand builder has to face the issue of promotion and what to do about it. Having spent a significant portion of my career in retail marketing, I understand well the lure and peril of promotions. When you want to “drive traffic,” nothing’s easier to execute than a big ol’ sale. I’ve advertised a gazillion of ‘em, myself, which has given me ample opportunity to witness their aftereffects: busted margins and often an ensuing drought of customers who — having already gotten what they wanted at a discount — can only seem to be reeled back in by… another sale. And so the merry-go-round begins.

I remember a number of years ago being exposed to supermarket scanner data for Coke and Pepsi sales that illustrated the point perfectly. As if by they were Siamese twins, the two soda behemoths had coordinated their promotional calendars to alternate promotions every few weeks — one week Pepsi, the next Coke, and vice versa. One week Coke would crest, then dip to a trough and plateau; the next week it would be Coke’s turn. Clearly the plateaus represented brand loyal customers and the crests on top of the plateaus represented customers more loyal to the promotion than the brand.

That’s the way the world is in every category: some people buy brands and some people buy price. People who buy brands get happy when their brands are discounted, but people who buy price won’t come back to your brand unless it’s discounted again. So if you think price promotion is your ticket to building a loyal clientele, think again.

It’s not that promotion is a bad thing; simply that it’s strong medicine that needs to be taken in measured doses to treat specific issues.

Which brings us to Groupon and all its socio-promo clones. Like all bright and shiny things, they are difficult for small businesspeople to resist, especially for restaurants suffering in the current economy, who account for over 30% of Groupon promotions. Groupon has been great for Groupon investors and exciting for all us folks who have been getting $40 of sushi for $20. But is it good for restaurants? And if it can be good, how do you make sure your restaurant is one of the winners.

A recent study of Groupon effectiveness by Utpal M. Dholakia of the Jesse H. Jones Graduate School of Management at Rice University reveals a lot that many of us have suspected and some of us have experienced for ourselves. Here are the raw facts:

  • Overall, Groupon promotions were profitable for 66% of the study’s respondents, but for only 58% of the restaurants.
  • Only 44% of the Groupon redeemers came back for a second visit. That number is only 13% at locations that reported an unprofitable outcome, which means about half of all the restaurants.
  • The factors that appear to either drive the numbers of Groupons sold are the duration of the promotion (longer is better); an upper limit on the number of Groupons sold (a limit is good); and whether the Grouponing business is a restaurant (people buy lots of restaurant Groupons). In other words, Grouponers favor restaurants, yet restaurants still struggle to make the promotion popular, and most Grouponers never return.

So should restaurants use Groupon or not? Well, yes, IF:

  • You are a new restaurant, desperate to ramp up your clientele. According to the study, effectiveness in reaching new customers was a primary reason for retailers to want to repeat a Groupon promotion. Even though the promo may not be profitable and most customers won’t be back, it may be one way (but not the only way) for a new restaurant to make customers. 13% is better than nothing.
  • Your employees are prepared to handle the Groupon rush and prepared for the likelihood of low tips. By far the greatest driver for businesses who want to repeat the Groupon promotion was employee satisfaction with it. The study relates lots of anecdotal evidence that restaurant employees resent the deal-prone Groupon customers (“waiters were frustrated by low sales and low tips, since guests didn’t tip the full amount”). So if you’re a full service restaurant, be forewarned; if you are QSR or fast casual, it may be OK.

If you do decide Groupon is worth a try, how can you get the most out of it?

  • Make sure your promotion lasts a month or more. Longer is better, not only because it gives people more opportunity to redeem their Groupon, but because it decreases the potential of a stampede.
  • Set a limit on Groupons sold. This should both drive demand and limit liability. 2000 to 2500 seems to be an effective number.
  • Don’t overdo your price cut. The study shows that Groupon value actually has a negative effect on demand. Rather than cut a full meal 50%, or offer $40 of food for $20, try offering up a single item at a discount, or a free side with another purchase. You ought to still be able to drive demand, but retain enough margin to increase your chances of coming out on the profitable side.
  • Use the opportunity to collect customer data. If your goal is to increase tour customer base (and it should be), you can’t afford to miss the opportunity to onboard your new arrivals onto your email and/or mobile marketing lists and encourage them to “Like” you on Facebook. If you’re not ready to do those things, hold off on your Groupon until you are. It could be the difference between a successful promotion and a money pit.

Oh, and one more thing: avoid the Groupon clones. They’re even less effective than the original.

You might need rebranding if…

17 Nov

The recent Gap rebranding debacle gave brand folks like me ample opportunity to gas on about (pick one):  a) how foolish Gap was; b) what a clever ruse they’d created; c) how social media saved the day; or d) how quickly Gap responded (or caved, if that’s your point of view). But while plenty of digital ink was spilled about all that, I saw very little commentary about what SHOULD have provoked The Gap — or any other company — to take the rebranding plunge. How do you know when it’s the right time for a company to take a hard look at its brand and stir it up?

As Gapgate showed us, rebranding is a big deal. And it can take many forms: a change in “behind-the-logo” fundamentals; logo and tag line changes; a name change; and anything else in between. Putting all the forms of branding aside for a moment, let’s look at how to know when it’s time to consider the disruptive step of rebranding.

So, with apologies to Jeff Foxworthy and his “You might be a redneck if…” schtick, you might need rebranding if…

#1: You’ve lost market position.

If you were number one ten years ago and number three now, or number three two years ago and number six now, you better start fixing something. Tinkering around the edges won’t get you back to the top spot. Consider your brand. And by “brand,” I don’t mean your logo. If you’re not connecting with customers, there may be something seriously off, not only in in your brand fundamentals, but in your business strategy, or maybe in how your brand reflects your business strategy. In The Gap’s case, if they were worried about their market position, a logo change alone was the wrong answer. Maybe a more thorough brand initiative may have been a good idea. But I’m not sure they had really lost much market share; the market has simply been in a slump and sales have been lackluster.

#2: Your organization has (or is about to) change its business strategy substantially.

Apple is a great example of how a business strategy (to make people’s lives more interesting through digital products) is reflected in a branding strategy (sleek, simple, witty, smart). If they were to change their business strategy (and God knows why they’d do that) to one based on delivering productivity solutions to Fortune 500 companies, they would obviously consider rebranding. Companies don’t usually change their business strategies on a whim, but may find that those strategies have evolved over time, because of mergers and acquisitions, changes in the category, or simply because of the passage of time. Those are the moments to consider brand brush-ups, even if the correct decision is to hold off. If The Gap is seriously changing its business strategy, it certainly isn’t apparent.

#3: Your brand has outlived its customers.

Cadillac is a good example of a brand that had to evolve its brand before its customer base went extinct. They added a good bit of power and speed and updated their vision of glamor. And it’s worked, even though they didn’t change their logo. Pepsi tinkers with its branding every few years, to keep up with a young market that continually replenishes itself with new faces. They evolve their brand to maintain it. I find that many companies consider rebranding at about their twentieth year of existence. I’m not exactly sure why, but it seems that’s about the time the original vision, leadership and customer base have turned over. The Gap was started in 1969, then — for a variety of reasons — changed considerably in the 80s to become the store we know today. Maybe it IS time for a brand evolution. But — like with Cadillac — maybe tossing out your heritage with your logo isn’t the best way to start.

#4: Your marketing just isn’t working anymore.

Okay, I’m not espousing brand overhaul as a solution to a flawed marketing program, but… If your marketing has lost its luster, AND you’ve dialed through a number of strategies, AND your execution is sound, AND others in your category have been driving sales, you think just maybe you have a marketing problem that marketing strategies and tactics alone can’t solve? If your marketing is struggling to leverage a weak brand, you’d better strengthen the brand. I suspect this was the thinking behind The Gap’s rebranding: “Our advertising is world class, but sales still suck. Let’s rebrand.” Maybe the idea wasn’t such a bad one, even though the execution may have been wanting.

One more note: all of the “ifs” above relate to building long term growth. Rebranding, brand development, or whatever else you want to call it, should be undertaken with financial goals in mind. If not, don’t bother.

 

How People Choose Your Brand

5 Nov
The Consumer Decision Journey

© Copyright 2010 Mckinsey & Company

McKinsey recently published the analysis of a terrific piece of research, in which they detailed the route of what they called the “consumer decision journey.” Those of us who grew up with the AIDA model of consumer behavior (Awareness, Interest, Decision, Action) and all the various funnel models (awareness set> familiarity set >consideration set > purchase) have known for some time how flawed these models were as reflections of real life decision making, especially since the advent of the Internet turned decision making on its head.

The new map McKinsey charts begins with an initial consideration set of brands the consumer is already aware of. But rather than getting winnowed down, the set grows considerably as the consumer actively evaluates not just the initial consideration set, but anything else they find through word-of-mouth, web searching or newfound attention to advertising. In other words, whereas once we thought of consumers as gatherers of information (which we supplied), they are now hunters of information. Eventually they make a decision — very often at the point of sale. But more often than not — up to three times more often — that decision is in favor of a brand within their original consideration set.

So what does that mean for brand marketers?

  1. You shouldn’t ignore “push” advertising. If you can find ways to gain awareness of your brand and make it part of the initial consideration set, you stand a much better chance of being chosen. That means traditional media advertising still has validity. But inasmuch as traditional media advertising is no longer the only way to gain attention, you have other options, too. The idea of inbound marketing — capturing idle interest through dissemination of interesting information can certainly be effective.
  2. You need to make as much information about your brand as available as you possibly can. Many marketers have assumed that if they pushed hard enough to ingrain their brand in the minds of consumers, they didn’t have to work so hard educating them on the back end. Not so. When the gatherer goes out hunting for information, you’d better be there. Moreover, if your brand isn’t already part of the consumer’s initial consideration set, the evaluation process gives you another chance to find your way into her heart. It’s not enough to publish manuals on your web site; you need to be out there with testimonials, customer forums, category information and wisdom,… you name it.
  3. Pay attention to point of sale. All the evaluation consumers do can actually be confusing. Decision making is often left to the point of sale. It’s where the battle is often won.

Oh, and one more thing they found: consumers aren’t blindly loyal to the brand they chose (as if we didn’t know that). Because they tend to have evaluated the brand’s claims more carefully in the decision making process, they can be tougher in their post purchase evaluation. Does your brand live up to its promises?