Archive for October, 2006

Cocaine hits the street for users

Sunday, October 29th, 2006

It’s a buzz! No, it’s a bust!!

It’s coke in a can, otherwise known as Cocaine, the new pulse pounding caffeine drink.

Well, to be honest, there’s no actual “coke” in there. And no Coke® either, despite the looks of the can.

Buzz for sale

What the folks behind Cocaine are selling is buzz, and lots of it. First you can it, and then you spray it out of the can, with as much controversy as possible.

Cocaine has already drawn the ire of NY Mayor Michael Boomberg. And it’s been banned from 7-Eleven. Not to worry, though. That seems like part of its strategy.

Cracking the market

Since the best cocaine nickname was already taken, I guess Cocaine’s founders decided to go for the whole brick. To my eye, the “Coca” part of the name seems to have a slight prominence.

At any rate, the following seems to be the marketing plan:

  1. Load each 8.4 oz. can with 280 mg of caffeine (vs 80 mg in Red Bull).
  2. Add cayenne pepper
  3. Style the Cocaine mark as if written in cocaine powder
  4. Call imbibing the drink, “doing cocaine”
  5. Launch the drink at runway parties to glamorize its association with the drug culture of whacked out fashion
  6. Attack critical press as “liberal media”
  7. Position the drink (via clever framing) as “not a controlled substance”
  8. Launch the drink just before a national election, thereby gaining immediate condemnation from vote-hungry politicians, and tons of additional publicity. This will result in massive street cred with teens and twenty somethings, who think all politicians are bogus, and who happen to be Cocaine’s target market.
  9. Cultivate the identity of the honest but misunderstood outlaw, constantly threatened by figures of authority. Embrace persecution.
  10. Be (almost) impossible to find. Hint that you may soon be driven underground, or even banned (like the . . . cough . . . real stuff.)

Isn’t the Cocaine label just harmless fun?

Some might feel that the ruckus over the Cocaine label is misplaced. Why not just treat Cocaine on the same level as Opium, the perfume? The Opium name connotes exotic danger, obsession and adventure. It’s harmless fun: the brand as fictional device, a consensual illusion. No one protests that.

Cocaine seems quite different, though. First, Cocaine promises users a chemical high from ingestion. Second, it touts itself as “the legal alternative” to real cocaine, a powerful, addictive drug. That would make Cocaine a legal drug giving similar effects. Opium perfume doesn’t promise drug-induced euphoria. The question then becomes, “Do we want the target market for this product to seek such drug effects, and a concomitant drug culture as a context for their lives?”

Is Cocaine a brand, or a pseudo brand?

Authenticity issues aside, does Cocaine qualify as a brand? I don’t think so. Brands don’t play the customer for a fool, and Cocaine is certainly fooling.

Cocaine looks more like a pseudo brand to me. From our New Brand Glossary:

Pseudo Brands

Brands that aren’t. Pseudo brands go through the usual motions of brands—an eye-grabbing logo, pumped up personality, lofty vows, zippy tagline and media splash—but do nothing to advance customers, or a company’s ties to them.

Personally, I wouldn’t be surprised if Cocaine stemmed from a bar bet over who could use standard marketing tactics to sell the most outrageous product to the most vulnerable customer class.

Links

Cocaine site
Energy Fiend
Wordlab
Bestweekever
(taste test and review)
Cocaine MySpace site

Photo: Cocaine.

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Commodities are a brand’s best friend

Friday, October 27th, 2006

Given that we now live in a global economy increasingly rich in commodity-level products, this might be a good time to reassess the relationship between brands and commodities. Although it’s popular to paint brands and commodities as polar opposites, if not mortal enemies, that hardly seems the case if you examine their relationship. Great brands are built on the shoulders of commodities. There’s actually a strong dialectic between the two that can lead to better brands, and better profits.

Instead of condemning commodities as the scourge of brands, brand builders should treat commodities as a brand’s best friend. Stand the conventional assumption on its head. The trick is knowing how to use commodities to create winning forms of brand value.

There’s nothing wrong with commodities

There’s nothing inherently wrong with commodities. Rich, ripe, rampant commodities are a foundation of global wealth. Thanks to commodities, the world is infinitely better off. Commodities are the grains of silica morphed into $2000 designer chips, or the $2 chips that run our toys. They’re the Arabica beans that power your espresso. They’re the junk cars shipped to Asia that return as a mini-fridge for your daughter at college. They’re also new digital technologies that collapse the barriers between companies and their customers—at a rock-bottom cost inconceivable to brand builders a decade ago.

Commodities frame the brand challenge

The essential brand challenge is to deliver more customer value than mere commodities can provide. To do so, brands must make deep customer connections and actively advance customers to new ways of being and doing—things that commodities alone cannot accomplish.

There are three keys to this process:

  1. Your ability to see commodities as opportunities
  2. Your ability to innovate on customer value
  3. Your ability to create customers with lives too deep for “commodity thinking.”

This is a task for brand platforms and programs, rather than brand campaigns.

Commodities are the building blocks of brands

In the hands of a smart brand builder, commodities are the building blocks of brands. Commodity elements are especially useful in building brand platforms. Just as cheap gasoline made possible the mass market auto industry (and also made markets for suburbs, shopping malls, fast food, etc.) there are
thousands of forms of commodity value just waiting to be wrapped in brand imagination, and made into customers.

Ikea is a good example of a brand built from commodity components. When you visit an Ikea store, Ikea’s thoughtful supply of free (commodity) pencils helps make your shopping more efficient—and more pleasurable.

Brand builders, commodities and customers

As I see it, here is how brand builders fit into the big picture of commodity value:

  1. Give a capitalist a commodity and you’ll get a market.
  2. Give a businessman a commodity and you’ll get a product.
  3. Give a brand builder a commodity and you’ll get a customer.

Commodities are brand opportunities

What separates the brand builder from the first two is that the brand builder works through the customer to create value. A brand builder views commodities as brand opportunities. He or she will use commodity elements to make his or her customers more capable and more complete, with greater freedoms, creating market headroom for products now in the pipeline.

Brand builders understand that your customers are your best defense against commodities. Keep your customers moving forward, and commodity-level competitors will never catch up.

For some examples of how innovating on value and creating customers can make use of commodity elements, check out these links for Starbucks, “soft brand indie hotels,” and the origin of the iPod.

Look behind the “commodity threat”

Brands that feel “threatened by commodities” are often more threatened by their own lack of imagination. Companies that innovate in their products, and in their brands, rarely find themselves in commodity traps.

We say more about commodities here and here.

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Birth of a brand operating system

Thursday, October 26th, 2006

Via Seeking Alpha, the Stalwart reports on Google’s incremental development of a “Google operating system” before our very eyes. I would interject that Google doesn’t realize it yet, but this is really a “brand operating system.” To date, however, there’s not much Google brand to be seen.

Nonetheless, the birth process is in full swing.

From the Stalwart:

In response to an analyst question regarding the blizzard of new Google products being a bit confusing, [Google co-founder] Sergey Brin says we shouldn’t think of these as each individual products, but rather as new features within the overarching single Google product. Thus indeed what we’re seeing is the Google operating system under construction . . ..

A little further on, Brin adds:

What we are concerned about is that if we continue to develop so many new individual products that are all their assorted silos, you will have to essentially search for our products before you can even use them. And then you will have to search before you can do a search, in many cases.

Instead what we’re doing now is we are trying to create the horizontal functionality across a range of products, across media types and so forth.

Google has been working in this vein for a while, especially with functional suites like Google University, a good step toward an enabling brand.

Limitations of a product suite

A product suite can only go so far, however. A suite is focused on functionality, and that is both its strength and its limitation. Computers can happily address each other through strict protocols of functionality, and applied functionality drives many workflow processes. People, however, are not “functions.” And “functionality” is a long way from living.

And for Google, that’s the rub.

It’s time for Google to lead

There’s no algorithm for people. A “Google operating system” can run Google’s 500,000 computers, but it won’t do diddly for Google’s customers unless it’s predicated on what those customers want to be, and where they’re headed. To move its customers beyond the clutches of Microsoft and Yahoo, Google needs to articulate a customer goal, and to show customers the way.

Brand operating system defined

How Google leads and interacts with its customers is part and parcel of its brand operating system. In our New Brand Glossary we define a Brand OS as follows:

Brand Operating System
The Brand Operating System (Brand OS) is a set of steps, leaps and revelations that enables customers to do more, and be more, through the brand. It includes integrated context, content and tools that customers can adopt to pursue richer realms of living. The Brand OS provides traction for customers in the direction they wish to go. In practice, it functions as a customer operating system championed by the brand, and fully interactive with it.

Until now, Google has been mostly about Google, inwardly focused, keeping the door closed while tossing new apps out through the transom until they cover the hall floor. The apps are great, but truth be told, they’re not the real deal.

The real deal is . . . us

We need a living, breathing customer to take shape in the Google womb, and to be delivered kicking and screaming. We don’t want to watch it on YouTube, either. That customer is us. It’s our experience that Google has to deliver.

Enough of machine code. It’s time for leaps. And revelations.

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There’s hope for the Dell brand

Wednesday, October 25th, 2006

At long last, there’s hope for the Dell brand. Dell’s new partnership with AMD signals a potential turnabout in Dell’s recent fortunes. After two decades of being the street seller for the Microsoft/Intel consortium, Dell had hit a brand ceiling. Brand-wise, there was no way for Dell to go. Certainly no way up. Microsoft and Intel made history, and Dell sold the souvenirs. Because the other two companies picked the game and held the cards, it was hard for Dell to create a strong brand identity with a strong customer connection.

A global faceless follower

Dell, based in a state of rugged individualism, had become a global faceless follower. And it’s no accident that everything that Dell isn’t, Apple is.

For a while, Dell’s claim to fame was its service. But that suffered when Dell decided to monetize service via outsourcing and cost cutting. Service quality crumbled, and Dell’s “service” cachet dropped off the cliff.

Recreating the Dell identity

The Dell brand can use the AMD deal to help recreate its identity. There’s energy in fresh starts. While the Dell/AMD relationship is limited, and currently focused on server technologies, there’s no reason it can’t expand to laptop and desktop markets, and carry a new Dell with it.

Let’s see: plucky AMD is the perennial chip outsider, now with a lead in chip performance. Dell is a proud Texan tired of being a hollow front. Down-to-earth Dell competes with the polished Apple. There’s the rough cut of a gritty brand story here, ready-made for this guy.

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How brands can prevent low-end disruption

Wednesday, October 25th, 2006

Do brands have the power to save companies from low-end disruptive innovation? The answer is: “Yes.” Brands can create their own innovation avenues that can render low-end disruptions “irrelevant.” To reach this point, however, we need to move beyond the legacy mindset of traditional brand approaches.

In this overview I’ll discuss:

  1. Disruptive innovation and brands
  2. How traditional brand approaches invite low-end disruption
  3. Why “creating customers” is the best way for brands to defeat low-end threats
  4. How brands can make low-end disruptions “irrelevant”

“Building strong customers” vs. “building strong brands”

To understand the full context of brands and disruption, we need to grasp at the outset that “building strong brands” is not the ultimate goal for brand builders. The real goal is to build strong customers. Your customers are your greatest competitive weapon. They are your innovation partners within your strategic value network. As such, they provide the most resilient defense against commodity-level incursions.

Disruptive innovation is about customers, not products

An additional up-front observation is that disruptive innovation is not about products. It’s about customers. “Good enough” and “convenient” are disruptive benchmarks, and “good enough” and “convenient” are customer judgments. Because brands have the power to free customers from current constraints, brands can move the disruption landscape above and beyond product-level developments. You can use your brand to grow your customers into markets your competitors can’t reach–and that includes low-end competitors. (Growing the customer doesn’t mean making customers spend more money, or locking them into your products. It means making them more successful in a way that sustains your business.)

In brief:

  1. “Disruption” is a factor of culture, context and customer, and is thus brand territory
  2. Brands are a mode of innovation (replacing one customer mode with a better one)
  3. “Disruptive innovation” is the stuff of brands

I’ve discussed how “disruptor brands” can attack established brands in a previous post. My focus here is on mitigating low-end product disruption.

Disruptive innovation and brands

One of the traditional goals of brand building is to make brands so powerful that they’ll be insulated from the “low-end disruptive innovations” analyzed by Clayton Christensen in his numerous studies. These kinds of disruptive innovations get the attention of brand builders because they’re typically associated with the commodity threats that can undermine price premiums and customer loyalty. Unfortunately, the ideal of an “impregnable brand” seems to be wishful thinking. A Maginot line of brands might look good on paper, but when push comes to shove, it’s useless. Christensen has extensively documented how “best of breed” (conventional) brands can be thoroughly undermined by “good enough” products that carve out new markets from below

The disruptive innovation model

Christensen’s disruptive innovation model is well known. It posits that innovators typically bring a new product to market and then work to fulfill the inherent product trajectory, maximizing profit by serving those customers with the most demanding needs, and refining the product to higher and higher levels, steadily moving upmarket in the process. Over time this profit-maximizing arc can leave opportunities at the lowest market levels for new entrants. In time, however, these bare bone products and processes can mature and redefine the market away from the incumbents. Examples would be the slow, fuzzy desktop copiers in the heyday of Xerox; the first PC’s in the days of mainframes and mini’s. These “toys” eventually came to dominate their markets.

In this model, “good enough,” “convenience” and “low cost” gain footholds because they have price and practicality on their side, and because established companies deliver no products, and no brand value, at these entry levels. The potential disruptors are closer to the customers than the established brands, which never descend from the brand stratosphere.

Traditional brand approaches invite disruption

Traditional brand approaches don’t really fend off disruptive innovation. Actually, they make it worse. I’ve cited the many weakness of traditional brand approaches in previous posts. See here and here. In a nutshell, the problem with traditional brand approaches is twofold: 1) they model brands as communications rather than value delivery platforms; and 2) their top-down broadcast methodology leads to passive, low-performance customers, who return little value back to the brand. The lack of two-way interaction creates a brand vacuum that disruptive products can exploit.

Iconic brands are the most vulnerable

From my perspective, the brands most likely to be disrupted are those that act as icons to be revered, rather than as dynamic engines to create customer value. A brand that pretends to icon status can be seduced by its own image while real-world customers move in other directions. Such brands can flourish for a while, sometimes even defining a category, but eventually they dry out. Think of Levi’s or Gap, once dominant, now groping for context, and struggling financially. They dry out because they refuse to be nourished by customers.

As icons, such brands stand apart. Since they don’t want to dialog, they don’t listen. They want their customers to be passive “consumers,” i.e., sheep with credit. They also assume (foolishly) that brand inertia will keep customers in the fold.

How brands should NOT approach disruption

For brands, the worst response to a low-end disruptive threat is to pull up the drawbridge and retreat behind the brand. This is like a fragile monarch who flees to his castle at the first sign of peasant unrest. It’s a response that treats the brand as an unchanging, static asset to be protected at all costs, much like our frenzied king would use his castle walls and royal troops. Unfortunately, this is a counterproductive strategy that will simply cause a greater rift between the brand and its customers. Autocratic brands will go the way of kings. The strategic goal of a brand is to get closer to its customers, not to itself. It does so by helping customers get to where they’re going, not by holding them back.

“Creating customers” is the best brand strategy

Through their ability to create customers, brands have the power to thwart, mitigate, minimize or otherwise disrupt the very forces of disruption themselves. Brands do this at the customer end, rather than at the product end, using the creative suite of cultural riches available to them. (Cultural and context elements are far more valuable to brands—and to customers—than symbolic and persuasive elements.)

Brands create a customer when they put that customer on a path where he or she can create themselves. The brand delivers vision, resources, form, power and freedom. These are expressed through your offerings in such a way that the brand becomes a creative dialog for a mutual advance of company and customer. For the first steps in this process see, How to design a customer. (A longer post on creating customers is in the works.)

Value-based brands can outwit disruption

When I mention brands I don’t mean conventional brands that act as symbolic or psychic wrappers, and which function as stylized sales stimulants. I refer instead to value-based brands conceived and structured as avenues of innovation. These are brands designed to create customers by delivering new forms of value that customers can use. It’s this very act of “creating customers” that can blunt the onslaught of disruption. Creating customers changes the customer landscape from the customer end. As a value delivery process it moves the context of the customer to a different location (one demonstrably better for the customer), such that a potentially disruptive “good enough” product becomes a limited, “not relevant enough” product. In other words, by elevating customers, brands can make disruptor offerings fall short.

Brands are value delivery systems

We can’t lose sight of the fact that brands are value delivery systems, not fabricated fluff. They raise the customer bar, and the customer. They understand that the survival game doesn’t go to the brand that looms the largest. It goes to the brand that creates the fittest customers—who will carry the brand forward.

Making low-end disruptors “irrelevant”

To render low-end disruptors “irrelevant” brands can innovate aggressively on the customer side to grow their customers in a direction away from low cost, “good enough” initiatives. In this process, brands consider the whole customer, not the stereotyped “buyer” or “consumer.” Their goal is to deliver new ways for customers to succeed within a particular context. Through this approach, brands can unlock new customer dimensions and deliver value to new customer realms. For example, an iPod puts you in a new customer realm where you have power over your music. It’s the realm of a DJ rather than the spider hole of a music listener controlled by traditional CD’s.

Creative brand value is the key

If a customer desires a low-end (disruptive) product, what can an established brand do to change that customer’s mind? The brand can offer creative brand value in the form of customer value. After all, the customer seeks a solution context, not just an isolated product. (“Holes, not drill bits!” is still the imperative, but brands expand that to: “Customers want more of themselves.”) Building out the solution context is one brand pathway. Creating a stronger customer is another. (The iPod is a good example.) Co-branded products, endorser brands, sub-tier brands and more flexible lease/buy terms are options. More important, though, is a brand platform approach intended to migrate the customer to a level where disruptive alternatives can’t compete.

Some rules:

  1. A brand can change a market category to alter the disruption landscape
  2. If your product “overshoots” a class of customers, raise them up so it doesn’t
  3. The brand goal is to sustain the customer, not to have the customer sustain the brand.

Brands and “competing against non-consumption”

There is common ground between Christensen’s concept of “competing against non-consumption” and what I call “creating customers.” They share similar planning processes in that that they are non-linear and customer-focused. Because brand innovation has continuous customer inputs, and can even be customer driven at times, it can sidestep established hierarchies and can route around conventional categories. In this process it can often speed along at a faster clip than product innovation itself.

In addition, creating customers often entails brand innovation above and beyond current (or conventional) business models. It can take totally new pathways. That’s one reason why you find Harley Davidson branded nick-nacks in the matronly aisles of Hallmark Stores.

“Purpose brands” built “to do a job”

In a 2005 Harvard Business Review article called “Marketing Malpractice: The Cause and the Cure,” Christensen discusses the concept of “purpose brands” as brands that can be “hired” by customers to do a specific job, mainly by communicating product fitness for purpose. (Thus, if you want to have a Martini and feel Manhattan artsy, you hire a bottle of Absolut.) There’s insight in this approach, but it reflects a conventional view of brands as a naming and communications device, rather than as an independent, value-producing process. In my view that limits its applicability. Brands are not wage laborers. They embrace, and are embraced in return.

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Top companies are serious about their brands

Monday, October 16th, 2006

Find a company that’s deadly serious about its brand, and that company will dominate its market. Its brand energy will keep it at the innovative edge, free from moribund thinking, and moribund markets. It will also prevent the company from collapsing into sclerotic bureaucracies where “brand” is reduced to media games.

Toyota leads with the brand

That’s my takeaway from an October 14 WSJ piece (sub req.) on how Toyota reinvented itself to be able to produce vehicles for global markets outside of Japan. Such “local production” was (and still is) a Herculean task of focus and execution on principles aimed to make Toyota vehicles truly world class. Honda and most recently Nissan also show the same fortitude to “lead with the brand.”

Brands lead by example

Like all brand endeavors, “leading with the brand” starts at the top. It means leading by example. The CEO sets the brand tone, up and down the line. Once that’s done, if the tone is serious there’s no screwing around.

Top brands are serious about their customers

Alas, American car makers, who treat their brands like something out of Battle Creek, ceded brand leadership to others years ago. Toyota currently has 12 plants in North America; Honda has 8; Nissan has 4, all with more to come.

Customers saw these better cars and flocked to them. They could tell the companies were serious about their brands, because the cars were serious about the customers. The cars themselves delivered the message, creating new customers for vibrant new markets.

(Pictured: Toyota Fine N fuel cell concept car)

Photo: Wikimedia Commons
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Tools for crafting the brand: TV Tropes Wiki

Monday, October 16th, 2006

In crafting a brand, brand builders need to shuttle effortlessly from trail blazing to the transcendent, which is no small task. This is the first in a series of posts that will explore some of the tools that can help make the art of brand practice somewhat easier—and maybe a bit more fun.

Help for the brand story

The TV Tropes Wiki is a catalog of the tricks of the trade for writing TV scripts. You may not envision TV scripts per se in your brand, but you certainly envision character, plot, drama, structure and a winning brand story. If your brand employs narrative, and intends to convey new and special meaning, this site might come in handy to help you frame your efforts. If you use it critically, it can help you expel media clichés, and clichéd thinking, from the forward march of your brand.

Special section on brand tools

Eventually I’ll set up a separate section on Brand Tools that can serve as a standalone reference. If you can think of any sites or sources that might be helpful, please chime in.

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Brands and the human network

Saturday, October 14th, 2006

Brands create value networks within the vast and rich human networks that make up everyday life. Over the last decade, the Internet and its applications have totally transformed the nature of human networks, making them greater, and more intimate, at the same time. That’s one reason why brands are fast followers of Net innovations.

Internet-enabled human networks

The Human Network site has a useful series of definitions on just what an Internet-enabled “human network” involves: it’s dimensions, collaborative contours, content and connections. It’s worth a read, especially for brand builders.

A sample from Mike Arrington:

The human network has evolved from the clan to the Internet. We are all part of a flat, mega-connected hierarchy, allowing social interaction in its purest form, from the simplest emotional gasps to the most complicated intellectual debates. The human network is humanity in its purest and most beautiful form.

Brands animate networks from within

Whatever your brand, you will need a similar perspective on the network value that your brand delivers. For your brand to succeed, it will have to animate human networks from within, connecting people to new forms of value—and to other people—through the brand. Brands that can’t make this transition risk being left behind.

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