All posts filed under: Leadership

9 ways to stage a brand resurgence

Commoditisation is a fact of market. I always remember that great observation by VJ Govindarajan that “Strategy starts dying the moment it is created”. It dies because its (potential) effectiveness dies and with that, its relative value. That idea, transposed to brand is, in reality, what commoditisation is: the (slow) death of relevant value. However, there are strategies you can put in place to reverse the speed and/or pace of that commoditising effect. Here are nine ways I outlined to a leadership forum in Malaysia recently to decommoditise your offering and reassert its branded value. In the presentation itself, I focused on actual commodities, but the principles are in fact applicable to any brand/product that doesn’t command the value that it needs to, or once did: 1. Think of the product in new ways – when you redefine what something is or could be, you reframe its context and it’s much easier to redefine what it can be used for. When you stop thinking of milk as a drink, for example, and start thinking of …

The brands that dare: gamechangers

Some brands seem to rule the world. They’re big, powerful, profitable and widely adored. They talk and the world listens. They are the game-makers. They made the game and they continue to run it. Their playbook seems to pretty much decide the rules for most. But not everyone aspires to that level of success and not every market leader is at the apex of a totally satisfied segment. Which is why some brands opt for a different agenda. The gamechangers’ intentions are, quite literally, to change the world, or at least to shake the tree of the mighty incumbents. How do you do that without getting crushed or ignored? It depends. Did your brand start out as a challenger, or did challenging the status quo become your purpose as a brand? Because the starting point drives very different strategies and storylines. If your brand was a challenger from the start, one of the most powerful assets you have, providing it’s true of course, is a dirt-poor story. The brands that start from nothing and with …

Brands Beyond Functionality: 7 great lessons

Everyone talks about the need for brands to keep up with consumer demand, yet, curiously, some brands have lived on beyond their purely functional need, largely because they carry with them associations in the form of eternal ideas that continue to burn strong. Watches – for example. Who needs a Rolex today to tell the time (did they ever?) and yet the marque is unchallenged because prestige is an idea that never goes out of style. Zippo is another brand that has outlasted the heyday of cigarettes. As this article in Ad Week explains, “Harnessing its long-standing popularity with men and its indelible associations with fire, Zippo now sells an Outdoor Line that includes everything from emergency fire starters to hand warmers.” True diversification. In a world where so many brands lose relevance and fall by the wayside, what lessons should we take from iconic brands that have successfully passed their necessity date and continue to prosper? The issues faced by Victorinox seem to me to symbolise the dilemmas and the opportunities. Their Swiss Army …

Outperforming as a brand: making the right investment in disruption

Everybody professes an interest in growing. Everyone wants to outperform the market. Yet the challenges to do so are for the most part under-estimated and the appetite required to resource adequately in order to decisively disrupt is generally lacking. An interview with Stephen Hall and Conor Kehoe, two McKinsey directors, on why companies are reluctant to aggressively reallocate resources reveals that strategic inertia springs from two sources. According to Kehoe, there is unwillingness internally to move people and/or capital to unproven initiatives. And there is resistance from investors who, even though they like the long term results, are hesitant to accept short term downturns. The business case for redistributing strategic energy though is clear. In this study, the firm compared those who reallocate resources at a high level with those that were much more reluctant to do so. The difference was a 3.9% difference in annual incremental returns to shareholders. Over 20 years, that amounts to a doubling in total returns to shareholders (assuming all dividends are reinvested). Companies that actively reallocated resources continued to …

Brands and regulators: rethinking compliance

It’s easy to see recent surges in regulation as a reaction to the corporate scandals of previous years and to characterise the return to a much more compliant environment as one of bureaucracy on a roll (and a role for that matter). But one of the reasons re-regulation is back, surely, is that the world is moving away from a pure market forces model (driven by business) towards a marketplace model that incorporates drivers such as consumer rights, environmental concerns, ethics and responsibility. Whether you agree with the politics of this or not, that new marketplace model is much more sympathetic to a regulatory approach. It’s also a sign of a shifting sense of consequences. The former model left it to the market within reason to decide what would and would not happen, pretty much relying on efficiency to sort out what needed to be rectified. The GFC proved that the market wasn’t the world’s greatest policeman and that sectors on a roll aren’t necessarily all that thorough about a whole bunch of things. This …

When other brands attack: 5 reasons to defend yourself

Is there any reason why you wouldn’t defend yourself in the face of an attack on your market share or reputation? None that I can think of off-hand. Because to do so is to simply hand hard-earned loyalty and turnover to someone else on a plate. Nevertheless, faced with a concerted effort to take market share from them, too many brands defy rational behaviour and either carry on with business as usual or simply ignore what is going on in front of them. Here are my five reasons why you shouldn’t behave that way: It telegraphs weakness or at least vulnerability: Failure to respond decisively and aggressively tells your competitor(s) that you are not in a position, physically or emotionally, to do so. As such, it simply encourages greater activity on their part. It tells your customers you don’t care: When you fail to fight for your customers, it tells the people who buy from you that you either take their loyalty for granted or that you don’t care if they leave. Delays push you …

Brand repositioning: Radicalising your brand

Comes a point in the lifecycle of most brands when they hit critical complacency. The marque has mainstreamed to the point where it effectively blends with its surroundings to form part of the amorphous middle. That’s the black hole towards which all brands are drawn. Competitiveness erodes. Prices start to fall. Comfort levels and intransigence soar. Appetites for risk, so apparent in the early years, fall away. Eventually, the lights go out. We could all run a list of those that have succumbed. But whilst complacency and conservatism are easily spotted, they are much more reluctantly abandoned. Getting off the merry-go-round is difficult, because it requires management to re-radicalise; to muster the courage and the energy to pick new fights and wage new wars; to attack what they operate so efficiently and effectively now in order to save it. (Seth Godin in his book The Icarus Deception expresses clearly and strongly how and why industrialisation works this way.) It’s hard to be radical and commercial: hard because it so often looks unreasonable. As Gary Hamel …

Finding the true value in non-financial returns

This article in the Wall Street Journal Online from some years back examines the business of social responsibility and asks what’s the financial payback for generating all this goodwill. Perhaps the most interesting point to emerge was that social responsibility was not directly rewarded financially by effort invested. Companies that did just a little were rewarded almost as much as those that went all out, leading the writers of the article to conclude: “It seems that once companies hit a certain ethical threshold, consumers will reward them by paying higher prices for their products. Any ethical acts past that point might reinforce the company’s image, but don’t make people willing to pay more.” So, beyond a certain point of noticeability, the notion of social responsibility is actually more important than the reality. As consumers we are motivated to reward positive actions – up to that point, but not far beyond. This in itself raises begs wider questions around the elasticity of goodwill. How far does it stretch economically? What credibility should we give goodwill as …

10 reminders for market leaders (prompted by recent events at Blackberry)

The distance between ubiquitous and anonymous is shortening. In 2009, Blackberry was named the fastest growing company by Fortune magazine. Four years later, it has less than 3% of the market. If you’re not driving the speed of innovation in a market, no matter how far in front you are right now, the market will overtake you. The first word is not the last word. Having an innovation doesn’t protect you from the next innovation, because, to quote Alex Goldfayn, “gravity pushes backwards”. If your innovations don’t align with where your key customers are heading, to reference Wayne Gretzsky, there’ll be no-one there who matters when the puck arrives. Every market leader thinks they can spot the disruptive change in an industry and that, once identified, they will then be able to quickly catch up and overtake the competitor. They seldom do. An extensive IP portfolio won’t save an ailing company because it only protects what you’ve developed. If what you’ve developed is now unwanted or unuseable, it’s practically worthless. Growing markets don’t always continue …

Brands in a no-attention economy

I’ve said for some time that brands seem to be taking more and more of their prompts from the fashion industry – in how they act and how they think. Not surprising, given that the upgrade economy now demands that brands refresh and update their products with increasing frequency. Indeed as Matt Baxter-Reynolds points out in this article on the likelihood of an Apple iWatch, “over the past dozen or so years Apple behaves more Louis Vuitton and Prada than Microsoft or Samsung.” That being the case, it’s interesting to look at fashion journalist Suzy Menkes’ recent observations on the pace at which the fashion industry itself is now forced to work, and to ask whether we can expect the same behaviours across the wider brand spectrum. Once, says Menkes, a handful of fashion houses produced four seasonal collections. But today, with thousands of designers in the marketplace, promotional shows in Asia, Dubai and Brazil and between-season showings, the industry has 138 fashion weeks worldwide, and schedules that pack in up to 264 shows over five days. …