It’s almost funny the way that Google sometimes pretends that it has no brand obligations, that Google is responsible for nothing–and accountable to no one–since its products are “free.” It’s an attitude that says, “Take it or leave it. We have no brand relationship.” That’s a risky stance in an increasingly “social” world.

Google as Soup Nazi: “No brand for you!”

Google’s attitude  brings to mind the famous Soup Nazi episode in Seinfeld with its memorable  “No soup for you!” Instead of the Soup Nazi behind the counter, though, I imagine Google back there, barking “No brand for you!” to anyone who dares question what is given.

The You Tube video can’t be embedded, but here’s a link:

Image credit: Larry Thomas

How on earth could the Google brand let this happen?

A fork in the Android brand

To answer the question above we first have to examine the provenance of Android itself. Google developed Android as open source software. Google offers it essentially free to mobile device makers to spur its adoption in as many mobile devices as possible. There’s a catch, however. Software that’s open source can be–and often is–”forked.”  While Android readily lets licensees add their UI and top end elements to the base software, developers can–if they wish–forgo the official Android license and take the open source code in a new direction entirely, “forking” or branching it from its original path. The newly independent code can’t use the Android name, or Google add-on’s like Maps, Google Voice, etc., but that may not matter. The new fork has its own agenda, and is essentially a new brand itself.

The big forker is Amazon

Enter Amazon. Amazon has cleverly taken an older version of Android and developed a proprietary Amazon tablet OS with it, tightly integrated into Amazon’s market offerings. The result is the Kindle Fire, offered at a disruptive price of $199 (seriously undercutting the price points of Android’s tablet partners). The Kindle Fire is a full-function tablet that incorporates Amazon’s app store, downloads for games, music and video, books and everything else in the vast Amazon offering. It bypasses the standard Android App Market and other Android services set up by Google as part of the original Android platform. Amazon thus steps in to potentially steal revenue from Google and its Android tablet partners. It also potentially excludes Google from the valuable user information capture that’s critical to Google’s revenue model. That information capture is what Google envisioned for Android in the first place.

Android as a recessive brand

Let’s now take a close look at the nature of a recessive brand. A recessive brand does not pass its full DNA to customers as a unique and compelling context of value or brand experience. It “does a job” but otherwise keeps to the background, deferential and dumb. It doesn’t lead; it goes along for the ride. It does not procreate brand value. It doesn’t stand tall as a brand that one can interact with, get to know, and ultimately trust.

Escape from accountability

As I see it, Android was developed as a recessive brand that happily surrenders its Google identity for the sake of fast global ubiquity. Beyond that, the passive Android taps into Google’s historic un-brand ethos of not wanting to be held accountable–for anything. In other words, Google wants Android brand ubiquity without Android brand responsibility. It doesn’t want to be on the hook for OS issues, screw-ups and associated problems where it has to deal with those messy things called people. In contrast to a proactive brand that embraces customers and stands behind its product, Android needs someone else to “front” the brand and to deal with you and me. In mobile and tablets the front men are the device makers (HTC, Samsung, et. al.) and the carriers.

Recessive brands are not viable

No one can argue with Android’s market share success in mobile, but I would contend that Google’s recessive brand strategy is unsustainable over the long haul. The OS has to have a strong brand behind it, one that thrives on user interaction and for being accountable for what it does. A recessive brand may work as a tactic to initially flood a market, but it lacks the connective tissue to grow a powerful brand base. It leaves too much customer on the table.

In tablets, Amazon’s Kindle Fire is evidence that Android’s open source decision has backfired by enabling major low-price competition from Amazon. At the higher end, Apple’s tightly integrated iPad2 (with a strong brand behind it) has set a commanding standard. Android tablets lag far behind. What are Google’s odds now that it’s competing head-to-head as a non-brand with Amazon and Apple, two of the most powerful brands in the business? Short answer: dismal.

In mobile, Android versions 1.0, 2.0 and 3.0 were used by different device makers and carriers in a slew of releases that made OS fragmentation a major issue for coveted app developers. There were too many different Android versions to develop for, and too many loose ends, so developers said no thanks. Apple’s unified (and strongly curated) iPhone iOS  has become the mobile OS of app developer choice. Android apps lag far behind.

What should Google do?

What should Google do to regain brand momentum? Happily, it’s already taking major steps.

Tactically, Google can end the fragmentation of earlier Android versions by issuing a canonical update. This it has done with Android 4.0 for mobile devices and tablets. Device makers, though, are still free to modify the user interface and insert their own add-ons (as carriers are known to do.) Thus, the canonical “Android experience” remains ephemeral.

Google could become “the whole brand” by producing phones and tablets itself, transforming the Google brand into vertically integrated value, a la Apple. Voila: Google has announced plans to acquire Motorola Mobility, maker of the Droid phones and Xoom tablets, among others, for $12.5 billion. The extent to which these Moto phones will exemplify the Google brand remains to be seen. That runs the risk of alienating Google’s current device partners (which also raises questions about the brand wisdom of that original open source strategy.)

Google’s Nexus Prime is the latest canonical Google phone, doing business as the (Samsung) Galaxy Nexus. History is not on the side of half-brands.

Google might also focus and integrate its services, becoming a unified brand rather than 1001 parts. Voila: Eric Schmidt gets kicked upstairs and Larry Page takes charge as CEO with a charter to streamline operations and focus, focus, focus.

These are steps forward, to be sure, but they really don’t address Google’s paramount brand challenge, which—as I have argued previously—is how to become a brand of trust. For Google, no trust, no future.

Strategically, Google’s only hope is to become a brand of trust

Google’s descent into recessive brand territory is (in my view) an extension of its desire to be unaccountable to end users. It doesn’t want to look them in the eyes. Strategically, however, Google must come to grips with its brand responsibilities. It can’t ignore them any longer. A recessive brand is not a competitive strength. This means rethinking the Google business model and its brand model, and moving end users (you and me) from being sheep-like Google products (our info-fleece groomed and harvested) to being customers and proactive innovation partners. From a brand perspective, Google’s only hope in our increasingly “social” world is to become—fundamentally—a brand of trust. It must innovate toward social freedom rather than toward social capture. Crack that nut and the rest of Google operations will fall into place as a brand platform of sustainable services. Otherwise, Google and Facebook will circle each other in a race to the bottom, and there’s no brand future in that–for anyone.

Additional background links

For background on Amazon’s use of Android against Google, see  How Amazon picked Google’s lock. You can find a “first impressions” review of the Kindle Fire in the Washington Post. I also refer you to the Quora discussion: How likely is it that Amazon will wrest control of Android away from Google, as Microsoft did to IBM with the PC?

Can a company’s board of directors damage the company’s brand, even if the board has no stipulated brand responsibilities? I think the answer is “yes” if the board fails to execute wisely in two critical areas. First, if the board hires a CEO unable to articulate a brand vision that advances the company beyond competitors. If  the brand vision fails everyone fails: customers, employees, partners, shareholders. Second, the board can damage the brand if the board’s own actions become so controversial and/or questionable as to taint brand credibility and trust.

Types of brand damage that can occur

As I see it, the types of brand damage that can be caused by a poorly performing board of directors can include:

1. Loss of customer confidence if board decisions make the brand appear weak, unfocused, or without clear direction. The brand assumes an element of risk.
2. Loss of employee confidence if board decisions appear reactive and non-strategic, or if the board-appointed CEO can’t articulate a coherent brand vision of what the compan stands for, where it’s headed, and especially “Why?”
3. Loss of investor confidence if a pattern of board decisions points to lack of unity at the top, internal politics over strategy, and/or a designated CEO who seems ill-equipped to meet expected challenges. As investors sell shares the brand loses asset value, and may approach break-up value (sold for parts).
4. Board missteps may lead to difficulty recruiting top CEO candidates because no executive wants to work for a company with an unsteady board. Consequently, the brand may be starved of executive leadership.
5. Board missteps may lead to loss of confidence by channel partners if the company’s brand pales in comparison to brands of competitors. Competitors are quick to seize on any apparent band weakness.

The HP board and the HP brand

Available evidence suggests that the board of directors of HP would seem to meet the two brand-negative conditions noted in the opening paragraph. The Hp board has appointed CEO’s who turned out to be a bad fit for HP, and the board’s own missteps have compounded HP’s problems. HP’s recent CEO’s have been at the flashpoint of turmoil and controversy, and so has the HP board itself, most notably in its internal spying and pretexting scandal of 2006. This week the board named Meg Whitman as HP’s seventh CEO since 1999. Ms. Whitman replaces Leo Apotheker, whose fit with HP was questioned 11 months ago when he replaced Mark Hurd. Hurd had lost the confidence of the board after a highly publicized battle over sexual harassment allegations and expense report irregularities. The board’s actions in terminating and suing Hurd also drew criticism.

Brands are designed to be seamless vessels of seamless value, but at HP seamless transitions appear to be the exception rather than the rule.

A board described as “nearly dysfunctional”

From the New York Times, on the day prior to the Meg Whitman announcement:

The mystery isn’t why Hewlett-Packard is likely to part ways with its chief executive, Léo Apotheker, after just a year in the job. It’s why he was hired in the first place.

The answer, say many involved in the process, lies squarely with the troubled Hewlett-Packard board. “It has got to be the worst board in the history of business,” Tom Perkins, a former H.P. director and a Silicon Valley legend, told me.

Interviews with several current and former directors and people close to them involved in the search that resulted in the hiring of Mr. Apotheker reveal a board that, while composed of many accomplished individuals, as a group was rife with animosities, suspicion, distrust, personal ambitions and jockeying for power that rendered it nearly dysfunctional.

A board that didn’t interview the CEO that it named

As noted in the previous link, the HP board unanimously voted to appoint Apotheker as  CEO  in September, 2010, but only the four board members on the search committee had interviewed him. The remaining eight board members had no interest in meeting him for a face-to-face interview. This is disturbing from a brand perspective. One might ask: What was the board thinking? This was a candidate for the highest position at HP, a man who would define and execute  HP’s vision, values and strategy going forward. Certainly he was a man critical to the success of the HP brand. How can you not look him in the eye, size him up, plumb his vision and values, measure him against the challenges confronting HP, and determine first hand if he is fit to be a successor to the esteemed William Hewlett and David Packard?

“Jarring strategy shifts” and a stock price plunge

Eleven months after the HP board unanimously agreed on Apotheker’s appointment, the CEO was sent packing. Apparently, Apotheker had no clue of his impending termination. The HP stock price had plunged a stunning 47% during his short tenure, during which he had proposed “jarring strategy shifts.” These included:

1. Proposing to sell or spin off HP’s core PC  business—which accounted for a third of HP’s revenue—without any plan in place at the time of announcement. This raised numerous strategy questions, sent investors reeling, and sent the stock price downward.
2. First touting HP’s entry into fast-growing tablet market using WebOS software (from Mark Hurd’s $1.2 billion Palm acquisition), and then several months later abruptly cancelling it, and proposing to exit the WebOS line of business.
3. Announcing the acquisition of software company Autonomy for $10.3 billion, without clearly defining how the acquisition would contribute to HP’s market growth and revenue. In addition, the price paid for Autonomy was questioned as being too high.

Saving HP from a brand of confusion

HP is a brand of . . . what? Brands provide clarity of company purpose. When brands are mismanaged the result can be a brand of confusion, where the company may struggle to fit a category, but falls short of a brand that can command a context. HP is an established brand and certainly not “broken,” but Apotheker’s recent announcements raised more questions than answers—and brands are answers. Apotheker’s legacy to incoming CEO Whitman is a gnawing sense of confusion regarding HP’s new direction. What’s the new context of HP? Is HP pulling out of consumer markets? How does Autonomy take HP to the next level? And how do proposed radical changes translate to the bottom line?  What’s the vision, and the plan? As her first order of business Whitman needs to erase any potential brand confusion from the minds of employees, customers and investors.

HP and the spectre of brand implosion

Even worse than a brand of confusion is the spectre of brand implosion. In a brand implosion the brand vaporizes and the company is seen as a collection of pieces. There is no brand context that makes the whole greater than the sum of its parts. HP is far from imploding as a brand, but the spectre of brand implosion is raised when analysts speculate on the breakup value of a company. The parts are seen as more valuable than the whole because the brand that drove the whole company has lost its way, and its grip. (Sadly, Yahoo may now have reached this stage.)

A potential HP breakup as described in CFO World:

Since Leo Apotheker became chief executive officer in November, Hewlett-Packard’s shareholders have lost out as the company fell five times as much as the competition and faced its first decline in profit in more than a decade. It may now lure buyers looking to break it up and acquire the pieces, according to Solaris Group LLC. The server unit would boost Oracle Corp.’s share fivefold and help it become the biggest maker of the hardware. Hewlett-Packard’s printer business, which is 70 percent more profitable than the company as a whole, may also attract private equity firms, Fiduciary Trust said.

“The value right now looks extremely attractive,” Michael Mullaney, who helps manage $9.5 billion at Fiduciary Trust in Boston, including Hewlett-Packard shares, said in a telephone interview. “For the right company, it probably would make sense for someone to come in and scoop it up. Someone could come and at least buy pieces of the firm.”

The CEO as brand visionary

HP doesn’t want to be the next Yahoo, an icon of  rudderless drift. It’s therefore incumbent that HP’s CEO be a brand visionary, one who can envision new value domains where employees, customers and shareholders can prosper. This means elevating the brand above symbolic fluff and recreating the brand as a method of deep value innovation, where the brand becomes the customer-facing application of the entire company. (See here and here.) The key is to define the company as a coherent, integrated and systematic platform of value creation. The whole platform, as a value delivery system, must be laid out. This is the productive brand discipline that HP needs, far more than glitzy sideshows and press events.

Some brand issues still remain for the HP board

One certainly hopes that HP can right itself, redefine its identity and brand mission, and regain its former stature. However, recent  Bloomberg and Barron’s reports identify potential areas where recent board decisions could still negatively impact the brand. These are:

1. The HP board did not conduct an industry search for the best possible candidate to replace Leo Apotheker. It quickly appointed an existing board member to the permanent CEO position. Some analysts interpret this as a move to stem investor fury with a quick fix, rather than a strategic hire. Other observers see an extension of board politics.
2. There are possible power sharing conflicts between the board’s new executive chairman and the new CEO. One corporate governance expert (in the cited Bloomberg report) called the current arrangement, “a recipe for trouble.”
3. The new CEO’s qualifications to lead HP have been questioned by analysts and investors, given her consumer and online background and HP’s declared enterprise services and hardware future. (Note however, that Lou Gerstner’s consumer background was no impediment to his acclaimed success at IBM, and the “IBM turnaround model” is often cited as a model for HP to follow.)

The HP brand would certainly benefit from a strongly strategic CEO who can articulate the HP brand vision and its context of value,  integrating HP’s assets and capabilities into a singular mission. That in itself may be a welcome first step to make the HP board’s past missteps truly a thing of the past.

Additional Sources

• The HP Board Fiasco Continues

• HP’s Board of Directors is Pathetic

• HP’s CEO carousel continues: Whitman officially in, Apotheker out

• Hewlett-Packard Reeling Accelerates CEO Succession Crisis

• The soap opera at HP continues

• HP’s CEO revolving door will hurt it in the long run

Photo credit: Anjum — Flickr

Brands succeed when brand principles drive business operations

As I’ve noted previously, brands succeed when brand principles drive business operations. To my mind, the leading brand principle is simple: “The closer you look, the better we look.” This is especially true for banks, proverbial  brands of integrity and trust. Traditionally banks have been stalwart brands of fiscal prudence: solid, reliable and properly cautious. They were brands we could bank on. What made bank brands work was the absolute integrity of bank operations. This was an integrity we could see, feel and trust, from our first step through the massive front doors to the guarded tellers and vaults within. In a bank nothing was left to chance. Bank practices and procedures included layers of sign-ins, sign-offs and sign-outs, double-checks from peers, scrutiny from higher-ups, and a general skeptical gaze.

At least that was the nominal rule until the massive brand failures of banks in the credit crisis and economic collapse of 2008-2010, well documented here. That was ostensibly a “lesson learned.” Bank brands are still recovering.

Brands are built from the inside out. And they die from the inside out.

Brands are built from the inside out. And they die from the inside out. Again, this is especially true for banks. Brands of trust are fragile creatures, even within granite walls and steel vaults. For the bank, brand values are key. They must be baked into every step of bank operations. Brand values are a systematic discipline.  This can be challenge for investment banks with profit-focused trading desks like UBS—and others before it (e.g., the brand flame-out that was Barings)—but the bank really has no choice. Again, it’s either run the bank as a brand, or, ultimately, run it into the ground.

The UBS brand: on the outside looking in

From the reports cited it would appear that the UBS brand suffers from being a brand on the outside looking in, rather than a core driver of UBS operating principles and priorities. The rogue trading in question apparently went undetected for three years, way back to 2008.

Here are key quotes from the first article cited above on the UBS brand failure:

The incident raises questions about the bank’s management and risk policies at a time when it is trying to rebuild its operations and bolster its flagging client base. The case could also bolster the efforts of regulators who have been pushing in some countries to separate trading from private banking and other less risky businesses. …

———-

“It’s a shock, a real negative surprise,” said Panagiotis Spiliopoulos, head of research at the private bank Vontobel in Zurich. “People thought that after the bank had been revamped following the 2008 crisis, it was set up in a way that could avoid this kind of event.”

Shares of UBS dropped more than 8 percent on Thursday, while the broader European banking sector was up.

———–

“The question that will be posed is how could this happen given the fact that all banks have committed to reduce proprietary trading,” said Rainer Skierka, an analyst a Sarasin, another private Swiss bank, referring to the practice of firms trading with their own money. “The next question is how the supervisor’s line of control works.”

Brands mitigate risk—when they’re brands of operation

A key value of brands is that they mitigate risk–when they’re brands of operation. Brands mitigate risk by institutionalizing brand values throughout company policies and practices. Brand principles become operating principles, endorsed and enforced. The stronger the brand the less risk a company incurs. A disciplined and systematic brand culture takes root. The brand aims to mitigate risk because it knows that an operating brand breakdown, such as that at failed banks in 2008-2010, or at energy giant BP in the Gulf of Mexico  (see here and here), may lead to catastrophe.

At banks the bottom line is trust

At UBS, and at all banks, the bottom line is trust. No trust, no business. UBS is widely known for its wealth management operations for high net worth individuals. Some of these individuals are worth more than $2 billion UBS just lost. The question now becomes whether doing business with UBS is worth the risk. That is a brand question UBS must answer.

END NOTE: Should investment banks get a brand pass?

One might argue that UBS is primarily an investment bank, and is therefore not a candidate for a prudent, risk-averse brand operation befitting a traditional retail bank, the kind that handles checking and savings accounts for everyday citizens. The investment bank culture, it might be argued, is a high-risk trading culture where big bets are made and big losses tolerated if bigger wins come in. In other words, the trading operation is a brand of risk rather than a brand of prudence. It’s a “casino” more than a “bank.”

Two key factors work against this argument. First, UBS management has tried to institute stricter operating controls following UBS’s near-fatal collapse in the credit meltdown of 2008–2009. Obviously, they need to do more. Second, the prevalence of an undisciplined trading culture argues that it be segregated from normal  banking operations, with the latter fully insulated from the risks of big bets. Such “ring-fencing” proposals are now under government consideration.

If banks can’t manage their brands, regulators will

From the Financial Times: Suspect trades reinforce ringfencing argument

UBS’s maverick transactions have caused too little damage to strain the bank’s stability, though a $2bn write-off could trigger a third-quarter group loss. But the ease with which deluded or dishonest traders can evidently still dodge internal risk limits will reinforce distrust of an investment banking sector where bad legitimate bets are a far greater systemic problem.

Brands are systemic solutions. If banks can’t manage their brands and solve such problems for the social good, regulators undoubtedly will.

Samsung competes against the Apple iPad and other tablets in the red hot digital tablet market. The company presented video testimonials as part of a Galaxy Tab product presentation at a press event at the 2011 CTIA conference in Orlando. Samsung then posted  a video of the presentation on YouTube.

How true is the testimonial?

Something didn’t ring true to tech editor Harry McCracken about the three individuals who praised the Tab in the testimonials in the video, so he did some checking. He found that two were actors and the third was member of a production company that has worked for Samsung.

Here is the video. The testimonial portion starts at 7:45.

What are “true life stories of Galaxy Tab users”?

Now Samsung might contend that these are not testimonials per se because they describe the videos as an “interview project” (whatever that might be). They might argue that the segments were merely dramatized use cases of a hypothetical travel writer, film director and real estate exec. In that sense, what we see are fictionalized personas, not (real) people. However, the on-stage presenters make it seem that the testimonials are real. They say, “It’s always very interesting to hear the true-life stories of Galaxy Tab users” (11:30) and they refer to the last video segment as “one consumer’s story” (25:05).

Truth matters to a brand

So, it would appear that we are supposed to believe that these are true stories of Galaxy Tab consumers, although facts suggest that they are scripted stories using paid talent. That’s not good for the brand. A brand draws a clear line between truth and fiction. That’s what separates a brand from fakes. Ergo, truth matters to a brand. And the worst kind of image a brand can create is an image of deception.

Let the Samsung brand walk the walk

Samsung is a highly capable global brand. I have no doubt that it can be a formidable competitor to the iPad and other tablets. But rather than jeopardize its brand credibility with pretend consumer testimonials, Samsung would be better advised to take the role of underdog to the iPad and give us spirited demos of what the Galaxy Tab can do in different use cases. Put someone real on a Galaxy Tab. Amp that person with 50,000 gigawatts. Let the Samsung brand and the Galaxy Tab walk the walk. Let that person talk to us. Directly.

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.

2. Conceiving brands as perceptions can undercut core brand practice, and increase risk.

A conventional school of brands contends that brands are largely perceptions. That is, the “brand” is how the company and brand are perceived. This school fashions brands as the stuff of media campaigns:  ads, images, symbols, stories, myths, slogans and PR, shaping brands as (campaignable) contexts of meaning. The brand aims to be a belief system, as part of an overall persuasion package. BP’s “beyond petroleum” ethos follows this approach.

Unfortunately, this is a limiting brand approach that condemns brands to advertising outcomes. Brands relegated to media campaigns lose their operational edge. They may be of little use in times of crisis. When the chips are down and you really need the brand’s help, it’s off on some billboard, or a 30-second spot. Thus, this approach may be risky indeed.

BP would have been better served with a brand approach focused on core brand practices at the operations level. In this approach the brand becomes a top-to-bottom shared “way” that infuses the organization. This focus on brand practice at the core, work-front level often spells the difference between high quality and low quality, between letting something slide and drawing the line.

Brands strong at the core don’t “cut corners” in critical operations.

3. A company can’t ignore the operating brand principle: “The closer you look, the better we look.”

The whole purpose of having an effective brand program is that the closer stakeholders look, the better the company looks. This is done with sustained integrity and brand accountability up and down the line. The brand earns respect because it stands (and stands up) for exemplary values that other companies can’t match. It earns admiration because it shows courage in taking a principled stand in how it operates. Employees, shareholders, partners and the community all benefit.

Unfortunately, since the blowout BP has left the impression that it wants to hide the accident and its consequences from public view.  This further undermines trust in the brand.

4. Brand boilerplate is no substitute for brand accountability

BP certainly flourishes impressive brand boilerplate on its website, but the brand  seems to float like a veneer, with little depth or engagement into the company, or into stakeholders. There’s no explicit brand accountability. It’s as if the brand were designed to be projected on a wall rather than pumped into the veins of the business.

From the BP website it appears that BP was more interested in going through the motions of a brand, with all the trimmings, rather than building an effective brand from the ground up. A stronger brand would tell the world what it’s responsible for, how it’s accountable, and how it wants to be measured.

5. A brand must do more than “represent” the company

To succeed, a brand like BP’s must do more than “represent” the company (as the BP website says. ) A brand that “represents” the company doesn’t drive the company.   A brand ‘s mission is to drive the company’s quality, innovation, operations and business practices to create customers and competitive advantage. Ethereal symbols and slogans in the name of the brand don’t really help at the point of production. BP says its brand is “a unifying and inspiring spirit for our entire organization.” That’s not enough. The brand takes charge and lays down the law. It’s a set of supreme operating principles and directives. Otherwise, it’s fluff.

6. “Brand equity” is no substitute for brand competence.

Before the blowout the BP brand enjoyed worldwide recognition, won prestigious awards from marketers, and had a 2009 market cap of $180 billion. Yet its track record in the last decade is hardly that of a competent brand. Fifteen BP employees lost their lives at a BP refinery explosion in Texas 2005. A year later an embarrassing and costly BP pipeline leak occurred in  Prudhoe Bay, Alaska. Throw in an attempt to manipulate natural gas markets and BP was fined a total of $370 million by the US Dept. of Justice for environmental crimes and fraud.

A competent brand earns trust; an incompetent brand squanders it. A competent brand builds expertise into a platform of confidence for future operations. Based on its record, BP seems behind the curve in this regard. As I see it, this is what happens when you position the brand as advertising. Brand-driven operations deliver more traction.

7. In a crisis, brand character steps up, and steps forward. If brand character is missing, the brand appears inept, or cynical, or both.

People want their brands to be heroes. They want their brands to perform under pressure, to stand up to adversity, to make tough decisions, and (always) to level with them in the process. This is the brand as team leader. We build brands for this purpose. Companies with character build brands with character. Brands with character lead.

The Deepwater Horizon disaster is BP’s show. It’s the chance for the BP brand to stand tall and show the world what BP is made of. It’s a character test for BP, a test the brand should welcome. It’s a chance for the brand to lead. Two months have passed since the accident, but BP’s brand character has yet to step forward in clear and decisive fashion. It seems to act only when pushed to the wall. That’s not brand leadership.

8. A brand can’t hide its heroes

At the present time the BP brand has no visible champion. The brand seems hunkered down, defensive, evasive, guarded, saying as little as possible, or saying nothing at all. It’s become a brand of defense lawyers.

At the operations level, however, buried from view, there are certainly legions of BP heroes, from engineers to drillers to dozens of crafts working tirelessly to solve the monumentally complex problems caused by the blowout. Deep oil drilling is extremely difficult even in the best of times. In a crisis it is exponentially difficult, dangerous and unforgiving. How many amazing BP brand stories of courage and ingenuity are there at the work front as BP battles to stanch the blowout? Quite a few, I’d imagine, but BP has kept them out of sight. Their impact could help reverse BP’s precipitous brand free fall. The American people would want to hear them too.

9. Brands are outcomes, not promises

BP has an exquisite mark brilliantly designed by Landor, one that positions BP as “an environmental leader” with the promise of “moving beyond the petroleum sector.” We are now more than a decade into that captivating mark and that far-reaching promise. While BP has made important and commendable investments in renewable energy, its defining brand behavior may be that of a company with “egregious” safety violations in recent years, leading to the Deepwater Horizon catastrophe.

In the real world brands are judged by their outcomes. Sadly, the reigning outcome for the BP brand currently looks like this.

10. The only place to “position” brands is inside employees. They make the brand work. To do this you lead by example.

Brands are culture, not campaigns. A company’s brand is a way of getting things done, tuned to the precise vision and values of the company. It’s a method, a practice, an art, all wrapped in the company culture. Thus, the only place to “position” a brand is inside employees. They make the brand what it is, and what it can be. Employees aren’t “aligned” to the brand. They see the brand in action and join up because the brand is an amazing opportunity to be creative, responsible and productive on the job. The brand is an expression of the best in themselves.

The only way to position the brand inside employees is to lead by example.

The world is waiting for the BP brand to take this step.

Photo credit: Wikimedia Commons

Google quickly apologized for its privacy transgressions, then implemented rapid fixes to help allay privacy concerns. That’s commendable. Repairing damage to the Google brand will take longer.

Brand trust or bust

For Google, earning brand trust is much more than a “customer relations” problem. Earning brand trust is now Google’s central challenge as a business. For Google, it’s brand trust or bust. Without customer trust in the Google brand, Google’s desire to be an all-encompassing provider of social media services, rolling up Facebook + Twitter + AOL + Windows  + Apple + Everything Else will be difficult—if not impossible—to achieve. People might use individual Google components—Gmail and Docs, or Google Reader, for example—but hesitate at the all-Google immersion. They will certainly push back if they feel railroaded into a one-sided relationship, as happened with Google Buzz.

Google must succeed as an platform of trust before it can succeed as a platform of social media.

You can’t toss your brand on the wall to see if it sticks

The disaster of the Google Buzz launch teaches Google a vital brand lesson. You can’t toss your brand on the wall to see if it sticks. At Google you can quickly develop a new web product and throw it against the wall to see if it sticks. If it fails to stick you can still get a pass. But things are different with brands. Customers are in the mix; live testing on customers isn’t. If you throw your brand on the wall and it fails to stick, your ass is grass.

Google’s business model can undermine its brand

Smart companies align their business model with their brand. It’s brand first, business model second. If Google follows a restrictive business model to capture, contain and control customers in order to harvest and monetize their information, the business model puts the Google brand at a competitive disadvantage. That’s because the essence of a brand is how a company approaches its customers. If the approach is primarily one of customer predation, the brand is condemned to be a shallow cloak or misdirection, diverting attention from reality. This approach wastes the strategic advantage of brands in advancing customers and co-creating value with them. Ultimately, the  “capture, contain and control” business model creates the conditions  for brand disruption from a new market entrant. It leaves too many customer gaps to be a sustainable strategy.

Google’s point of brand reckoning

Every company eventually reaches a point of brand reckoning, where its brand decides its fate. This can be a sobering moment, often at a time of profound crisis. Does the company intend to manipulate and contain its customers, or does it intend to raise them to new levels of being and doing, with freedoms to match? What’s the brand agenda? That’s the fundamental question. Google has now reached its point of brand reckoning. Where is it taking its customers? What kinds of customer growth does the Google brand offer? What new freedoms and opportunities? How are these qualitatively better than what Facebook, Twitter and other provide? What’s the Google brand journey?

In a proactive brand scenario, Google and its customers are on the same page, writing it together. Google does not dictate the script. It does not “write its customers in.” It does not try to script the customer experience.

Google as a brand of privacy

As I’ve argued before, “Protecting privacy confers strategic advantage.” This is certainly true in Google’s case. Radical as it may seem, Google’s best strategy going forward is to become the leading brand of privacy. A Google brand of privacy can solve existing problems of brand trust—and preempt future ones—at the source. A Google that leads in privacy can create sustainable platforms of trust that leverage innovative platforms of technology in ways that Facebook and Twitter can’t meet.

In Why Google Buzz isn’t buzz-worthy Mike Egan of Datamation details key shortcomings that stand between the algorithmic Google and Google as a “psychological space” (i.e., brand) that customers can trust.

If Google can’t rise to the level of a trusted brand, where it teams with customers instead of relentlessly mining them for data, its ability to compete with brands such as Apple will be diminished.

UPDATE

Feb. 11 In response to widespread privacy concerns over the Buzz implementation process, Google as tweaked and clarified the process. See here.

For additional context, see The negative buzz around Google’s new social network in the New York Times.

In deep space it might have been a good idea: since your business exists on computers and is accessed by computers, put your brand on computers, too. Automate it. Keep messy customers on the other side of the screen. Create an online Help Page. Fill it with FAQ’s. Cue up some Forums. Add video. List some email links but tell customers not to expect personal replies. Better yet, delegate customer service to your partners. And best of all, don’t include a phone number. Why invite time-wasting customer calls? Listening is not your business.

Then sit back and let the automated brand work its magic. No fuss. No muss. No puny humans fouling the flow.

In reality it was a bad idea

In reality—on Earth— it was a bad idea. On January 5, 2010 Google boldly announced the Nexus One “superphone,” a highly advanced iPhone competitor. The launch event was a smash, but things then went downhill. Google’s automated brand couldn’t connect with customers. Its few online circuits were promptly overloaded. So many customer questions disappeared into the ether that the New York Times asked, Hey Google, Anybody Home?

Customers called, and the brand wasn’t there.

Customers had questions—lots of them

Customers had questions—lots of them—especially about buying the Nexus One for $529 unlocked. Google made that offer a big part of the launch, raising a lot of “big first” questions, especially since the Nexus One is sold only from the Nexus One website. And—reading the fine print—it did seem that if customers bought the phone at a discounted price with a carrier (T-Mobile) contract, they might face early termination fees greater than the full price of the unlocked phone itself. Whoa! How does that work?

Searching for a brand relationship

Before shelling out hundreds of dollars for a path-breaking new smartphone many customers searched for a brand relationship from Google itself. Spending big bucks for an untested smartphone is a big risk that can only be mitigated by a highly positive brand relationship. Customers wanted a direct connection to the real Google behind the screen—to that human Google that had forever seemed so elusive. They especially wanted to feel confident that Google would support the Nexus One  in years to come, since its record of supporting its brand of phones was—at this time—precisely zero.

They searched for a brand relationship and wound up with a web page.

Customers notice if you don’t connect the brand dots

Customers connect the brand dots. They notice when you don’t. A path-breaking product from a new vendor has a lot of dots to connect if it wants to build the trust that builds markets. Apple has 284 Apple stores. In Google’s case, customers may have wondered how they could trust Google when it didn’t see fit to include a phone number for customer service on its site—when Google was proclaiming itself a major player in the phone business. Perhaps customers thought: You’re selling expensive super cool phones, but you don’t have a phone number to call. Hello?

Nexus One customer service complaints

Launching a forward-focused, highly innovative product on the shoulders of an automated brand is guaranteed to let customers down. Many customers apparently bailed on the Google brand when they couldn’t get answers from Google’s Nexus One Help Page. Immediately following the Nexus One launch, reports of customer dissatisfaction were all over the Web. A sampling:

1. Google Nexus One leaves customers sour Wired
2. Nexus One a test of Google’s customer service CNET
3. Google faces deluge of Nexus One complaints PC World
4. Google, Nexus One and the customer service risk ZD Net
5. Google’s Nexus One issues threaten its push to shake up mobile Wall St. Journal

The brand is not an algorithm

It’s tempting to think that we can reduce a brand to a simple, repeatable formula, and then activate it in finitum. Unfortunately, a brand is not an algorithm. It can’t be automated. It’s a living customer connection, vital, emotional, and changeable, drawing a large part of its life from customers.

Brands, in fact, are the opposite of algorithms. They’re interactive structures of discovery, far more culture than commerce. They’re made to innovate, to explore and to create new forms of value with customers as partners. At their edges they reinvent themselves daily. That’s how they can create new classes of customers that drive the business forward, into new market spaces. A fixed brand agenda to contain customers or to lock them in place is a prescription for failure.

There is no “beta” in brands

While Google is famed for it’s innumerable “beta” releases of free software, where it could formally shift risk to customers, those days are over. While there may be lots of “beta” in product development, there is no “beta” in brands. The grown-up Google is judged by its brand.

A slow start for Nexus One sales?

Wired and the Wall Street Journal have reported hat sales of Nexus One are off to a slow start. If true, part of the reason may be Google’s failure to advance its brand with personally engaging customer service. Without such personal engagement, customer questions, doubts and fears can easily become a decision that says, “Too risky. No thanks.” A weak or reluctant Google brand will mean that the Nexus One may never achieve its potential sales volume and market share.

Google as a brand of trust

In an abbreviated sense, we can identify three phases in the evolution of Google’s brand:

1. A work in progress –  The “beta” years, now history.

2. It just works — The current phase of high-performance automation

3. Google works for you — The next phase of brand trust

This next phase will be Google’s greatest challenge to date. It entails a Google brand built on relationships, not algorithms. It means Google must excel as a brand of trust, connecting with customers beyond the machine interface.

Nexus One as a brand wake-up call

Google’s customer service shortfalls with Nexus One are in fact a wake-up call for the Google brand. While Google has done a masterful job advancing customers with highly-integrated information services, it has reached a point where trust in Google is now every bit as vital as Google’s software brilliance. Google can’t automate the next step.

Photo credit: Iitmuse — Flickr