Value-based brands: Part II — Brand Innovation

See Part I here.

When businesses think of brands, they don’t usually consider brands as being part of the innovation process, right there at the cutting edge of value creation. Well, it’s time to change that perception of brands. Truth is, brands themselves can be powerful engines of innovation. They can reprogram a product that does A, B and C into one that does A through M, plus X, Y and Z. They can redefine the context of a business, unlocking new value. They can spring customers to higher levels that competitors can’t reach. Through their own platforms and programs, they can reshape markets, and create new market opportunities.

Yes, brands can do all of these things—when they’re value-based brands.

Brands as innovation engines

In this second installment of our series we’ll explore how value-based brands can contribute to the innovation process, as innovation engines in their own right, with results just as powerful as new products and services.

We will cover:

  1. The brand innovation context
  2. A definition of brand innovation
  3. The innovation charter for the brand team
  4. How brands innovate
  5. Selected examples

NOTE: Brands primarily innovate in two ways: brand form, and brand value. Brand form is near and dear to every brand builder’s heart, including mine, but our discussion here is on delivered brand value.

The brand innovation context

At Tenaya Group we look upon brands as part of the innovation process. Brand builders are innovators, pure and simple. As we see it, the value that brands can deliver is far too important for brands to be limited to “communications,” symbols, sunny promises and surface sheen. Brands represent a core value connection between companies and their customers. That means brand builders must be able to innovate new forms of brand value that can advance a company and its customers. Brands that don’t innovate are soon overcome by inertia. They stagnate. And then they die.

Our master definition of brand reflects this innovation focus:

“Brands are avenues of value innovation in a creative engagement between companies and their customers.”

In this formulation, “avenues,” “value,” “creative,” and “engagement” are all critical areas where the brand builder can introduce innovative approaches, processes and deliverables.

Defining brand innovation

Our definition of brand innovation is short and sweet: Brand innovation is product potential times customer potential.

The brand builder is the X-factor in the middle. He or she grasps the potential on both sides, then adds the strategic and creative powers to bring them to life, and to make them grow.

It all adds up to what we call “the brand exponential.” Take your product, or your company, and use your brand to raise it to a higher power—through the customer. That’s your only assurance that you’ll be tuned to the markets of tomorrow. Your brand is the exponent.

As a minimum, the product value squared

The value outcome of a simple brand might be the product squared. That’s only a start. We all want to aim much higher than that. In many cases, it’s customers themselves who contribute these exponential powers.

And we never lose sight of our macro view of brands, which keeps us running during the day, and flying at night: “Brands are tools that enable customers to inter-operate with the universe. The genius of brands is that they have no limits. The value of brands is that through them, customers have no limits.”

The brand team as innovation driver

In traditional brands, the brand team is closely tied to marketing and/or corporate communications, outsourcing much of the “creative” work to ad agencies and design firms. While this fits well with the traditional communication model of brands, it does not go far enough for value-based brands.

In value-based brands, the brand team is responsible for innovating brand value. They are, first and foremost, innovators. They’re key members of a company’s innovation team. They still maintain their media and communication roles, and contacts with media and design experts, but their focus is on brand innovation as part of new product development. They work hand-in-glove with engineers, programmers, product managers and customers to create new forms of brand value, and the platforms and programs to deliver them. Their mission is to grow the customer, the product, the brand and the business through new streams of brand value.

The brand team is both “in the trenches” and “over the horizon.” It’s not a job for those who seek routine and simple formulas.

Forms of brand value

Being the fluid, plastic and protean creations that they are, brands can convey value in a multitude of forms. Some forms are more durable than others. Some are much deeper. There can be new shapes and shades of meaning, new tools, new contexts for the product and the customer, new dimensions of product use, new associations that raise the customer to a new plane of action, new communities, and perhaps a new vision that frees customers from the dark of a cave.

What about brands built on make-believe?

What about brands that rely on make-believe, fictions, bells and whistles, fantasies, spectacle and entertainment? They can be, and are, wildly popular, and treasured by their adherents. But do they actually innovate to move customers forward?

There’s certainly comfort value in the well-trod truths they affirm, and spectacle value too: people love a good show. Their downside is that they often try to herd customers by a vigorous plucking of emotional strings. With no brand platform, and few real deliverables, such brands become prisoners of their media campaigns. They’re vulnerable to competitors who play the reality card, and who can offer their customers a taste of freedom that’s real.

How brands innovate on value

There are a number of pathways brands can take to innovate on value. Often these will be specific to a product domain or customer environment. A maker of eyewear will work with different brand value equations than a publisher of newspapers, or a software developer of widgets. A nap-of-the-earth approach will map brand innovations to potential areas (and vectors) of customer growth. Mauborg and Kim and Ulwick have defined useful baseline innovation methodologies.

In a more global context, brand innovations can accomplish the following (often in combination):

  1. Free the customer from current constraints of the market
  2. Enable the customer to do more with the product
  3. Advance the context of the product
  4. Advance the context of the customer
  5. Through the brand, increase the customer’s proactive powers
  6. Leverage brand experience into customer experience
  7. Incorporate the customer into the innovation process
  8. Leverage the brand platform into a customer platform
  9. Unlock the customer’s creative powers
  10. Create a community that supports the customer


Here is a sampling of brands that illustrate aspects of brand innovation:

Linux — A user-driven brand. Includes almost all of the above points.

Harley Davidson — Customers innovated by customizing the bikes as bad boy machines. Eventually, Harley followed, albeit in tepid, corporate fashion. (The “chopper” zeitgeist is a customer phenomenon of liberating the brand.)

iPod — With iTunes, forms a new brand of music that includes many of the points above. Frees customers to enjoy more music and to express themselves through their music by having more personal control over it.

Arm & Hammer — Customers found new uses for baking soda, making their lives easier and making new markets for the maker. In essence, the customers led the brand.

Costco — Increases customer access to quality goods at discount prices, while minimizing customer risk with liberal return policies. Leverages startups. Enabler of small businesses.

Patagonia — Advances context of product and customer to a unified brand of ecology, where product, customer and environment co-operate as one.

Final note

Oh yes, the chap above is Thomas Edison. I picked this image because in it Edison exemplifies the moody, mercurial, in-the-trenches and over-the-horizon “brand builder look.” It’s the countenance of a person immensely unsatisfied with the status quo, and not totally satisfied with what he’s wrought, peering through it for still deeper connections.


4 Responses to “Value-based brands: Part II — Brand Innovation”

  1. Brands Create Customers » Blog Archive » How brands create customers: Part 1 Says:

    […] Value-based brands (here and here, with more to come) […]

  2. Brands Create Customers » Blog Archive » Customers advance the iPhone brand Says:

    […] In previous posts I’ve said that a good way to define brand innovation is product potential X customer potential. Think of your customer as the exponential power of your brand—your brand to the nth power. Instead of merely “selling” to customers, you join with them to advance the product, and the brand. The customer exponent can create tremendous brand leverage. […]

  3. Brands Create Customers » Blog Archive » How brands create high-performance customers Says:

    […] What kind of approach should a brand follow to create high performance customers? In general, if you give them the opportunity, they will come to you. They want the tools to enhance the product, and the experience. When a brand is structured as an innovation platform, the elements of a program to cultivate high-performance customers often fall into place. These include: […]

  4. Brands Create Customers » Blog Archive » As mass media dies, brands are born anew Says:

    […] Revisit the brand mission. Your brand mission is to create the customers that will drive your business forward. Creating customers is a structured process of brand innovation that develops and delivers value customers can use. […]