Archive for the 'Brand Leadership' Category

The Nokia brand on the brink

Thursday, February 10th, 2011

Many eyes in the brand world will be focused on Nokia tomorrow (February 11) when new Nokia CEO Stephen Elop announces a long-awaited turnaround plan for the struggling mobile phone giant. The event in London is a big deal because, quite frankly, the Nokia brand is on the brink. In smartphone market share and profits Nokia has been battered and bruised by iPhone and Android. Its brand has been hammered, too, virtually knocked off the map in the US.

A big announcement to address some big brand questions

From a brand perspective, the February 11 announcement will hopefully answer a multitude of pressing brand questions: What’s Nokia’s new brand vision? What’s the new brand strategy? How will Nokia lead its customers in ways that Apple and Google can’t match? Will the brand be energized to deliver a full suite of customer value, as a complete customer experience, or will it be downsized to the brand of a supplier? The latter would signal a major step down for a visionary market leader.

This was a brand problem from the get go

In my view Nokia needs a sweeping brand reformation because its many problems (and they’re very serious problems) stem from a gradual but deep dereliction of brand. Nokia’s troubles were a brand problem from the get go. There was no overriding brand vision to overcome the device-centric silo-ism that fragmented and smothered Nokia’s own forces of innovation. Without that vision to orient R&D to strategic customer outcomes, market opportunities were missed and massive development budgets accomplished little.

Mindset problems are brand problems

A common critique of Nokia is that it suffered from an insular, “prove it to me” mindset that shot down new ideas and thwarted initiative and change, enabling Apple and Google to run away with the smartphone market. I would argue that mindset problems are brand problems. They’re a “way” of preserving operational status quo. They can pull the plug on brand vision, and they can cripple the holistic view of the customer that products need to innovate successfully. A common result is products that frustrate users.

Elop: Nokia must now fight “a war of ecosystems”

Elop has laid out Nokia’s challenge in his fiercely blunt “burning platform” memo to employees. (Well worth reading in its entirety.) After citing the painful details of how Nokia lost its market leadership to the iPhone, Android and other competitors, Elop concludes:

The battle of devices has now become a war of ecosystems, where ecosystems include not only the hardware and software of the device, but developers, applications, e-commerce, advertising, search, social applications, location-based services, unified communications and many other things. Our competitors aren’t taking our market share with devices; they are taking our market share with an entire ecosystem. This means we’re going to have to decide how we either build, catalyze or join an ecosystem. [emphasis added]

So that’s Nokia’s newly defined task: how to build, catalyze or join an ecosystem. I find it a bit strange, though, that customers are not included in the ecosystems described. To me, customers are the most important part.

The brand as prime mover of the ecosystem

In the February 11 meeting I’d be looking for a more customer-focused concept of ecosystem to emerge, one with fewer elements than Elop lists, and one with deeper brand relationships. As I see it, the customer is the focus of the ecosystem, and the brand is the prime ecosystem mover. It’s brand vision and values that give the ecosystem meaning and direction, and make the ecosystem productive. And I would make it one ecosystem, not many. A multitude of ecosystems creates potential conflicts and might even generate debilitating intra-ecosystem rivalries.

Keep the ecosystem simple

The Apple iPhone ecosystem is hugely successful and not complicated. It exists for the benefit of customers, to make the purchase and use of iPhones as easy and delightful as possible.  Apart from the wonderfully designed iPhone and iOS, the ecosystem is iTunes, the App Store, Apple retail stores, the developers who craft the apps, the apps, Apple customer service, and iPhone customers who provide feedback. Much of the ecosystem is embedded in the iPhone itself. The moving parts of the ecosystem are kept to a minimum. It’s through the focus and quality of the ecosystem that everything “just works.”

An alliance with Microsoft?

The latest rumors are that Nokia will announce an alliance with Microsoft to feature  Windows Phone 7 mobile OS on Nokia smartphones. This would be a sea change for Nokia, which has heretofore produced both devices and software, and desired to own the full user experience. The Nokia brand has been the Nokia handset running custom Nokia software. Nokia’s Symbian OS is used worldwide, and its new MeeGo OS was slated for upcoming smartphones.

A prediction on what to expect on February 11

Horace Dediu of the highly respected Asymco blog has ventured his predictions of what the February 11 announcement might bring.

  1. There will be a multiple OS strategy
  2. The US market will be the first to see a new non-Nokia OS. I would guess Windows Phone with AT&T.
  3. Low end devices will remain with Symbian due to price considerations for the chipsets, components.
  4. MeeGo will be phased out in phone products but development will continue for tablets

This may seem like a radical departure, but in many ways it’s not. Nokia has nothing to lose in the US as its platforms have zero traction. By maintaining Symbian for low end devices, they can still aim for differentiation where Nokia feels it still has distribution and cost leverage. This strategy will also allow speed in time to market.

I would add that in the US a Nokia/Microsoft mobile phone alliance might be considered  in last place behind iPhone, Android, RIM’s new Blackberry touchscreen OS and the new HP/Palm webOS phones and tablets.

Where does all this leave the Nokia brand?

Where does all this leave the Nokia brand? There are some serious brand implications in the above February 11 scenarios. Here are some key questions that the Nokia meeting will need to address:

  1. An agreement to use Windows Phone OS means that as a brand Nokia no longer owns the complete user experience. It’s now shared with Microsoft, at least in US smartphones. Doesn’t this diminish Nokia’s brand stature?
  2. A Nokia handset running a Microsoft OS is hardly a “Nokia smartphone.” It’s half Nokia, half Microsoft. Who owns the brand voice? Whose vision will lead customers?
  3. By giving up the smartphone OS Nokia apparently downgrades itself to a device supplier. As such, it’s no different than HTC, Samsung, LG, etc.  Doesn’t this weaken Nokia’s potential hold on customers?
  4. If Nokia adopts Windows Phone OS for its smartphones, Nokia becomes dependent on Microsoft for smartphone OS innovation. The Nokia brand could be compromised if Microsoft fails to innovate as fast as iPhone and Android, to name only the top two competitors. How does the Nokia brand handle this?
  5. If Microsoft makes the OS and Nokia makes the device, who directs and manages the ecosystem? Whose ecosystem is it? For that matter, whose customer is it?
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Did BP fail its brand? Or did the brand fail BP?

Thursday, July 15th, 2010

badpolluter

In a previous post, Brand lessons from the BP oil disaster, I framed my discussion by asking: Did BP fail its brand; or did the brand fail BP? In this post I’ll explore these two failure modes in greater depth. A brand failure like BP’s might arise from using the wrong brand model, which no amount of execution can save, or by employing a correct brand model but failing to implement it properly, especially at the management level.

What caused the BP brand to go off track?

I’m looking for causal factors that might explain why the BP brand went off track, resulting in the blowout disaster and massive pollution. Future hearings, investigations and court cases should provide us with much more data than available now. This is a preliminary snapshot, nothing more. My goal is to posit some basic brand rules applicable to all brands, in whatever business or organization. I’m using BP as a provisional case study.

(And to those who might argue, “You know, you really can’t separate brand strategy, brand model and brand execution” I’d say I agree philosophically, but I’m forcing such a separation here for analysis purposes.)

How can a brand “fail the company?”

The brand itself can fail the company when it’s the wrong brand approach for the business. This is a brand model/brand strategy issue, as I see it, in which a brand can fail the company in two ways. The first is when the brand model can’t advance the company and its customers beyond the reach of competitors. The brand doesn’t create competitive advantage, and the business suffers as a result. In the second (and far more serious) case, the brand fails to optimize internal operations, and in so doing actually increases business risk. The result may be a quality breakdown, or even a business breakdown. In both the first and second cases, a company has the wrong brand model for the job.

The perils of an “image campaign”

My “sense” is that brands most often fail the company when the brand is positioned as a stylized sales stimulant, in an “image campaign” of advertising and promotion. The resulting brand isn’t part of the meat and bones of the business. When stressed the core business can founder, with notable weak points being innovation and quality.

Signs that a brand might fail the company

Here are some specific signs (as I see them) where a brand might be in danger of failing the company:

  1. The “brand” is defined as a media campaign that promotes the brand identity. It exists as part of the company’s persuasion and promotion package. (E.g., “Beyond Petroleum.”)
  2. The brand doesn’t state what it values, and why. (And the brand is no guide to what’s right and what’s wrong inside the company.)
  3. The brand makes no commitments.
  4. The brand doesn’t define a clear chain of accountability.
  5. The brand is largely decoupled from day-to-day operations. As a brand, it’s mostly symbols and slogans. It is not a working brand.
  6. The brand relies heavily on myths and make believe, further divorcing it from day-to-day realities. (The brand also plays little role in innovation, quality and value creation.)
  7. There’s nothing visceral in the brand for employees (and customers). It has a “Wizard of Oz” feel to it. Lots of smoke and mirrors, and a very big curtain.

How can a company “fail the brand?”

Let’s now look at the other side of the question: How can a company “fail the brand?” Here we assume a brand that’s properly structured within an effective brand strategy. The brand is OK, but the company prevents it from achieving its objectives.

Signs where a company is in danger of failing its brand

Here are some specific signs (as I see them) where a company might be in danger of failing its brand:

  1. Management believes that the brand’s sole purpose is to make the company look good. The brand has no internal value beyond the “image appeal” it can generate externally.
  2. Management positions itself above the brand. It doesn’t exemplify brand values in its actions, nor does it lead the brand by example.
  3. No one in management is accountable to the brand. (Or accountable to brand values.)
  4. The brand does not fuel the corporate culture. It’s decoupled from business decisions.
  5. The brand is treated as a form of communication, rather than a method of optimizing operations. It’s kept as a messaging layer.
  6. The brand team (if there is one) has no authority. It’s marginalized into a feel-good adjunct of marketing and corporate PR.
  7. Management treats the brand as a financial “asset.” In this accounting mode the brand loses its position as a core value-set and tool for best practices.

And in BP’s case, perhaps “both”

In my previous post on BP (link above) I suggested that, based on preliminary indications, BP’s brand failure in the Deepwater Horizon blowout was probably a combination of both failure modes: a brand that failed the company, and BP management that failed the brand. Maybe more of the first than the second,. In time more facts will help clarify what actually transpired prior to the blowout, and may reveal other brand issues as well.

Photo credit: Fibonacci Blue — Flickr

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Brand lessons from the BP oil disaster

Wednesday, June 23rd, 2010

deepwaterhorizon2

It’s not too early to discern some strategic brand lessons from BP’s horrific oil disaster in the Gulf of Mexico. BP is a global oil giant with a highly visible (and controversial) brand identity: a major oil company that’s positioned itself as “beyond petroleum.” Yet today the BP brand is smothered in oil as far as the eye can see, a symbol (and agent) of massive pollution.

Why the BP disaster is a big deal for brands

The BP oil disaster is a big deal for brands because it marks a catastrophic failure of a top-tier brand. As such, it stands to have far-reaching consequences that will play out in time across all brands. At this early stage, three immediate “big deal” factors stand out to my mind:

  1. BP has become the antithesis of its proclaimed identity. It has gored its own icon. How could that happen to a billion-dollar brand?
  2. We may be witnessing the greatest sudden loss of brand trust by a company in the history of business. This is much more than a brand doing a poor job of crisis management. It appears that the BP brand took its eye off the ball and allowed the crisis to happen, a transgression no brand—or business— can afford.
  3. Events suggest that BP’s reliance on “positioning,” “messaging” and “mindshare” (an advertising approach to brands) helped decouple the brand from operational realities. The resulting BP brand was “positioned in the mind” of a campaign audience but had diminished presence in BP’s drilling operations, where it was desperately needed before and after the blowout. Current cost of this disconnect: $2 billion (and growing).

What are the long term brand consequences?

As I see it, the BP oil disaster will contribute to a reassessment of the conventional “mindshare” approach to brands that treats brands as media artifacts in a persuasion package to shape perceptions. This superficial “branding” approach can blind the brand to operational issues desperately in need of brand direction. There’s growing evidence that this is exactly what happened in BP’s case. The brand outcome is the full story. It can’t be bottled in a mindshare campaign.

Due to the enormity of BP’s brand failure I’d expect to see a new emphasis on brands  as a method of delivering operating value, rather than symbolic campaigns. In this structured brand value approach, brand principles and priorities directly drive business decisions, with a brand’s full emotional force. This is a working brand of company culture, rather than campaigns.

What went wrong with the BP brand?

What went wrong with the BP brand? The framing question, as I see it, is this: Did BP fail its brand? Or did the brand fail BP? At present, I’d say the answer is “Both.”

We also want answers to related questions: Were there critical flaws in the BP brand approach? In the brand model? In the brand strategy? In brand program execution? Was the problem weak brand leadership? Or was the brand simply marginalized, relegated to media campaigns and decoupled from essential company operations (e.g., brand practice in the oilfield) where it might have made a difference?

If the BP brand was indeed “beyond petroleum,” what precise vision and values guided BP’s oil production business, and its dedicated employees? BP’s 80-page  Code of Conduct, “Our commitment to integrity,” makes no mention of the BP brand. How is that possible?

Not surprisingly, other oil companies are distancing themselves from BP’s oilfield practices.

A note about this post

I’m writing this as events unfold, so my assessments are preliminary. I’m also aware that BP is not the only company with responsibilities in the Deepwater Horizon disaster. My focus here is on brands as a form of strategic and operational leadership, and that means a focus on BP.

With a failing brand, BP’s troubles just keep gushing

When a brand fails, everything fails, and BP’s travails certainty point to systematic brand failure. We have BP’s CEO being raked over the coals in the US Congress. BP is currently facing possible criminal charges, accusations of cover-ups, fines of up to $258 million per day, and accusations of blocking reporters from covering the story. There are also serious allegations that BP had been cutting corners on safety.

BP’s brand failings have jeopardized the credibility of the oil industry itself, and will certainly lead to greater—and more costly—industry regulation.

What’s especially troubling is that these are the kinds of breakdowns in quality that brand programs are designed to prevent. A more effective BP brand program might have saved the $20 billion that BP must now set aside in escrow to pay for environmental and community damages.

The BP brand could have been a hero and shining star in this tragic episode.  Currently, it bleeds copious amounts of trust with every passing day.

Basic brand lessons

What follows are some basic brand lessons from the BP oil disaster as I see them at the present time. 7

1. “Positioning” the brand where the core business isn’t (in BP’s case, “beyond petroleum”) puts the brand at risk.

The BP oil catastrophe may herald the end of artificial “brand positioning” as an element of brand strategy. Under its striking Helios logo BP claimed a high-profile positioning as a “green” renewable energy leader “beyond petroleum.” As such, the BP brand was aiming for a make-believe category in people’s minds, since BP’s business was petroleum for the foreseeable future. Instead of being an enlightened brand of  innovative and responsible oil production, where 99% of its business resided, BP apparently let its “beyond petroleum” positioning blind it to a disturbing pattern of  risky design practices and short-cuts over a decade of operations.

In the real world, it’s the vision and values at the operations level that position the brand—and the business—to succeed.

(more…)

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How leadership builds a brand

Friday, October 9th, 2009

Strong brands flow from a force of character, and from the “character in action” called leadership. This is especially true in the zero-sum world of sports, where there are only two kinds of brands: brands of winners, and brands of losers.

Creating a brand of winners starts at the top, with team management, and especially coaches.

The head coach shapes the brand. This video link shows how Mike Singletary, tough-minded coach of the San Francisco 49ers, is helping turn a team of losers into a team of winners.

As with brands, this is an incremental process.

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How Wall St. broke its brand

Wednesday, April 1st, 2009

Read Eric Dinallo’s enlightening op-ed piece in the Financial Times called How we modernized ourselves into this ice age.

Key brand take-away: what made the US brand of finance the strongest in the world in the last century was its safety, security and transparency. You could trust that system with your money more than any other financial system in the world.

It was regulation that made the brand

Dinallo notes that this brand of trust was born largely of regulation–a system of very strong ground rules for how the game is played. The brand governed the players.

In effect, Wall St. was a brand of regulation–and one of the strongest brands in the world.

But as Dinallo explains, in 2000 regulations were dialed back, leading to a short-term Wall St. boom and then catastrophic trillion dollar losses, and a finance system in tatters.

Taxpayers are now being asked to re-build the brand that Wall St. wrecked.

Interesting issues:

  1. The role of regulation as a builder of brand.
  2. Regulators as brand builders.

Hat tip: Yves Smith.

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What can I learn from this brand?

Sunday, September 7th, 2008

When a brand introduces itself, every customer should rightfully ask: “What can I learn from this brand?”

The answer should be, “A lot.”

Strong brands are leveraged sources of learning

Strong brands are leveraged sources of learning. They’re not pedants, of course. They’re bottled fire, beams of light and life that spark awakenings and foment revelations. They have something to say, and they aren’t shy about saying it. That’s why they’re brands, and not labels.

Brands have the wisdom to bring products to life

Brands have the wisdom to bring products to life. A brand in this mode is more than a stylized sales stimulant, or a pre-packaged “experience.”  For starters, it’s interesting. (That alone sets it apart.) It has a history of deeds (exploits, scars, triumphs) instead of a puffed-out bogus “narrative.” It asks the questions that other brands can’t.

Imparting brandly wisdom

As the brand engages and interacts with customers it imparts its brandly wisdom. This is the combined insight and intelligence of its makers, every iota of value they fused to the product and the brand to move customers forward.

Brandly wisdom is the sensuous set of smarts that creates customers—and helps customers re-create themselves. You see it in the details—and in the vision.

Expect tectonic truths that blink

Brands don’t “teach” as much as they lead by example, forging new dialectics with you and me. As a customer, expect tectonic truths that blink. Spiritual leavenings. Flashes of far horizons. Worlds de-packaged, unwrapped, laid bare for you to clothe.

Brand experience is shared wisdom

Brand experience is shared wisdom. It leaves the customer—and the brand—wiser.

Photo: amarola — Flickr
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Strong brands lead the customer: Honda

Tuesday, August 26th, 2008

Honda (a very strong brand) provides an excellent example of one of my favorite brand maxims: Strong brands lead the customer; weak brands chase the dollar.

Honda’s brand leadership

Honda’s brand leadership is the subject of a recent New York Times article, Honda stays true to efficient driving.

During the glory days of big pickups and sport utility vehicles, one automaker steadfastly refused to join the party.

Despite the huge profits that its competitors were minting by making larger vehicles, Honda Motor never veered from its mission of building fuel-efficient, environmentally friendly cars like its Accord sedan.

“I remember being at the Tokyo Motor Show in the mid-1990s and talking about the environment,” said Ben Knight, head of engineering at Honda’s North American division. “The reaction was there’s no return on that.”

But in today’s fuel-conscious automotive market, Honda is reaping the rewards for its commitment.

No major automaker in America is doing better than Honda, whose sales are up 3 percent for the first seven months of this year in a market that has fallen 11 percent. …

Strong brands have a vision of how the world is evolving, and what customers need (and will need) to keep pace. And strong brands lead by example.

Behind every brand is a philosophy of value

We can also observe that behind every brand is a philosophy of value. This may be implicit, or highly articulated, or simply latent, in need of elucidation. But it’s there.

“Honda is a philosophy-driven company,” said Tetsuo Iwamura, president of Honda North America. “Even when the large S.U.V.’s and trucks were big sellers, they did not fit with our philosophy.”

At its heart, a brand philosophy is a customer philosophy. The brand is the enabler.

The value of brand leadership

Brand leadership is the ability of a brand to lead customers to a qualitatively better life. It means that a brand aims to do what’s right for customers. Over time, brand leadership builds brand trust—a critical foundation for market leadership.

Brand leadership and brand vision

A key element of brand leadership is brand vision: the ability to see your company’s future through your customer’s eyes. This sets in motion a long-term strategy for the brand—case in point: Honda.

Brand leadership and brand identity

A brand that leads builds its identity through its actions, as Honda has done, and is doing. The result is an enduring identity that can itself become a customer platform for wider social and environmental initiatives. When brand context becomes social context, the identity has arrived.

Photo: E — Flickr
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Google’s education brand gathers steam

Monday, August 25th, 2008

If you want to change the game in a market, one of the best ways is to use your brand to change the customer. Your brand can raise the customer to a whole new level, far above the status quo, and far beyond the reach of competing technologies or practices.

Take a look at what’s happening this summer at the Google Teacher Academy.

Going to school will mean “going to Google”

Google is on its way to becoming a dominant brand of education. As we’ve said previously, in the near future a student may “attend” Harvard or Yale or Michigan State, but that student will likely spend most of their time “in” various Google applications.

Going to school will mean “going to Google.”

When you are the “enabler,” your brand has arrived

Another way of looking at Google’s strategy is to consider how Google’s sets of online applications are becoming a standard “enabler” of learning. Being an “enabler” is the highest form of brand. It means that the value that you deliver is precisely what your customers need to get ahead.

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