"THE BRAND MAN SPEAKS":
The voice of the brand strategy consultancy, The Portnoy Group Inc.
The Brand Man Speaks is a dialogue about the consuming world in which we live and a guide to successfully navigating it. The goal is to educate people and companies about branding, the most powerful yet misunderstood business tool.
To learn more about branding and The Portnoy Group visit our website. Click on the link above, or click this link to the The Portnoy Group Blog Contact Page.
I just came across the new TV ad for Spirit Airlines promoting their usual low low no frills fares. The unusual element is they are "using" the Tiger Woods car crash in an animated way to sell low fares titled "Eye of the Tiger".
In bad taste or is Tiger open for such abuse of sorts?
Watching out for you everyday.
Eli
The recent car "incident" involving the biggest richest branded athlete Tiger Woods is the first real test of the golfing greats ability to manage his brand (worth billions) under extreme stress beyond the course.
Brand Tiger Woods has become the biggest athlete brand in history primarily due to his squeaky clean beyond reproach family man/super athlete identity. There have always been rumors here and there about women coming on to Tiger...quite frankly I am amazed he hasn't been the target of more damaging rumors earlier kudos to his extremely well oiled PR and management machine.
But now comes the real test. Had the incident occurred during "normal" hours of the day or even evening I would bet silence without deviating from "full speed ahead" would have made this matter disappear and Tiger would be completely unscathed. However, the time frame of 2:30AM (or thereabouts) really won't allow this matter to be just ignore and pushed aside. Everyone knows it was a very odd hour to be out and about and to be "unnerved" (for a guy with nerves of steel) enough to smash his SUV leaving him unconscious within a few feet of his own home spells big trouble.
Tiger is going to have to come clean one way or another with the public or at least with authorities. Unwillingness to talk in our culture equals hiding something.
A brand like Tiger's worth more than 1 Billion Dollars has a lot to lose so his crisis management team must not make any mistakes.
As with other athletes, sponsors have so far said they are behind their man. However, I believe, many will reduce their use of Tiger, even eliminate it, for a period of time hoping for a positive resolution soon. The longer nothing is said and public opinion creates its own spin on the events, the more damage to the brand and the more likely sponsors are going to suspend their relationship with him or even drop him altogether.
Since Tiger was so "clean" this event only magnifies the circumstances and every move is being watched and monitored by the press and public alike. We, the public, want to believe in his fairy-tale life and career and unlike some other athletes or entertainers who get into trouble, we really do want everything to be ok with Tiger and for him to still be the gold standard among athlete/celebrities. If anything, we can accept that he is human, as long as we are told some of the truth versus nothing that is believable right now.
One thing in his favor; he didn't (it appears so far) do anything illegal just possibly (if rumors pan out about an affair) something questionable to negatively impact his perfect very moral family values posture.
Come Clean Now Tiger, show us you are human, seek forgiveness and get back to what you do oh so very very well...play golf.
Watching out for you everyday.
Eli
In a recent WSJ article entitled, "The Wrap: consumers do spend on innovative goods" the newspaper declares that consumer spending is not dead in this recession, rather it is becoming more selective as money is tight and waste cannot continue in this new paradigm.
I was surprised by this revelation, as it is not really anything new. Consumers have always made selections of goods based on what fulfills their needs, desires and emotions.
What seems to have changed is that consumer products' companies are waking up to the fact that just creating tons of "me-too" products that do not provide meaningful reasons for being in consumers' minds no longer works. These companies got lazy finding the robust economy would absorb many useless products and services that did not provide any differentiation from what was already available.
Differentiation and uniqueness along with tapping into consumers' emotional needs has always been key to successful products and services. Many of us call this "Branding": creating a core reason for being for any product. Too many companies cut back on R and D in the last recession and failed to bring to market anything very interesting and innovative to consumers. Sony Electronics is a prime example of this. A company once known for innovation, it became almost an afterthought in the past decade.
A few companies have always understood the need for meaningful differentiation. Apple tops the list in my mind and in many ways they have replaced Sony as the master electronics innovator. Actually, left them in the dust like the endless line of useless jets airlines no longer use that sit in the desert somewhere in the US west.
Contrary to the WSJ piece, we are not entering a new era of marketing. Rather, we are experiencing a re-awakening of marketers brains to the fact that "old school" marketing is still important...more than important...mandatory for success in the world of consumer products. I am relieved to hear this news. Faux branding is dead. Real branding is about to take its rightful place at the top of the marketing world again. Consumers rejoice.
Watching out for you everyday.
Eli
I was stunned the other day to see a new format for CNN.com. I have religiously read this page everyday for several years as my first source of news and information in the morning.
I found nothing wrong about the old format. I found the information I wanted easily and the site in my opinion was consistent with the brand's television effort...both dependable sources for world news easy to access.
Sure websites need to be updated and tweaked periodically, however, the new CNN.com site is simply awful and a sharp departure from the original...not in a good way.
The site now is weak on news and looks more like a page of advertisements with cute links to rather low level video stories. It no longer speaks "news expert" or "superior source for news and information". It might as well be a tabloid page selling garbage celebrity stories.
I think whomever redid this site has completely lost sight of what the CNN brand is all about. I no longer have it as my home page, having switched to MSNBC.com's home page as an easier to use, more definitive news and information source.
CNN television still remains a good source for news, however, when you start to muck with various brand channels the overall brand strategy starts to fall apart and years of hard work to build the brand can be lost in mere weeks. That is what I think will happen to CNN if they don't immediately fix their website.
This move reminds me of Tropicana Orange Juice's recent major misstep with its package design which made the brand generic and sales dropped enormously and fast. They listened to the market reaction and fixed the problem quickly, saving the brand from a disastrous financial downfall and possible extinction.
Watching out for you everyday.
Eli
Teen, young adult retailer Abercrombie and Fitch had been one of America's most successful apparel companies. Despite premium prices, its targets...young men and women (who wanted to aspire to the brand's young, good looking and sexy image) bought its clothing in large numbers. Even older men who kept fit were avid buyers of A and F.
Then the recession hit and it hit A and F big time. The publicly traded company refused to discount its products or have big periodic sales to drive business. Instead, the brand (under its CEO Michael Jeffries) insisted in could withstand the weak economy (and a major drop in sales and profits) by staying the course with its premium pricing and lifestyle positioning.
I generally have been a proponent of consistent branding and NOT falling into the hole of going the discount pricing route to generate traffic and business---it is hard to recover from that move. However, this recession is unlike any we have seen before and with any significant paradigm shift, long held beliefs and business strategies get tested. Evolution of one's brand strategy is the appropriate course these days.
It does appear in today's new economy ( and it will continue I believe even with a recovery) consumers are demanding value and a strategically sound pricing plan (whether its Prada or Levi's or A and F) has to become a part of any brand strategy.
A and F's refusal to alter their business model seems to be causing the brand some major harm. It is no longer the darling of its prime target...on a recent shopping trip across the US, I found A an F stores consistently empty while other competitors for the young market were busy like H and M and Forever 21.
What is amazing is that CEO Michael Jeffries was paid in excess of $71 Million in total compensation last year despite the company's terrible financial performance...he was paid higher than virtually all of his industry peers again despite the brand's significantly declining sales and profits. Why? I'm not sure, but The Corporate Library, a research entity that tracks CEO compensation, has identified Mr. Jeffries as the one of the MOST overpaid CEOs.
Mind you this is NOT a privately held company but a publicly traded one...and one would think and hope that stockholders and Board members would significantly adjust Mr. Jeffries compensation given the company's very poor performance. If I was a stockholder in this company I would be screaming at the board...to take some of his compensation and plow it back into the company's marketing effort. I also find it hard to believe that ethically and morally Mr. Jeffries can justify his compensation. Where are the CEO's who do the right thing and voluntarily reduce their compensation when their companies are doing poorly? I wonder how may employees have lost their jobs and A and F because of the weak economy while Mr. Jeffries still gets paid top dollar?
Watching out for you everyday.
Eli
The economy has had an enormous negative impact on bookings at hotels and resorts throughout the US. Especially hard hit have been hotels that cater to corporate groups as business travel has been reduced dramatically across the board.
A recent report indicates this may not be the only or primary reason that hotels that live off corporate business are sufferings so much. Blame the AIG fiasco last year at the St. Regis Hotel in Dana Point, CA. While banks were being bailed out to the tune of billions, AIG executives were partying like it was "1999" at the St. Regis, running up a nearly $500,000 bill. Needless to say the negative publicity this event generated was unprecedented in corporate travel circles.
Since that time the St. Regis Hotel and Resort filed bankruptcy as bookings dropped to such low levels that the facility could not pay its creditors. But the mess hasn't just impacted the St. Regis.
It turns out the word "Resort" in a hotel's brand name or in the parent company's name may now be a kiss of death to that hospitality operation. Apparently, due to the AIG backlash, corporate travel groups are told to avoid bookings at ANY facility that uses the name "Resort" to avoid the possibility of communicating corporate partying vs. real work.
This has hit the top end hotels mostly but even properties with few frills are feeling the impact if their corporate parent's name includes the "Resort" word.
Hotels in South Florida, which has been a popular US destination for corporate retreats and meetings in the past, are complaining heavily that because so many of them are called resorts or affiliated with resorts they are no longer being considered by corporate travel planners.
Will this lead to the dropping of the word "Resorts" from hotel brands? It could if this AIG backlash continues for much longer. One travel planner indicated he was told he couldn't book any meetings with an organization that had the word "resort" in its brand name--- indefinitely. Wow! If that is true for lots of other travel planners that is very bad news for "resorts" and the hospitality industry in general.
Watching out for you everyday.
Eli
The recession has taken a toll on a whole host of retailers many of whom were well known names in the consumer products industry. Several notables include Polaroid, Sharper Image and home goods retailer Linen and Things.
When Linen and Things went out of business some months ago after failing to recapitalize and restructure out of bankruptcy, many thought it was a dead brand name. Not so. A partnership of Gordon Brothers Brands and Hilco Consumer Capital bought the former retailer's brand and have reinvented it hoping to capitalize on good will, a notable name and a strong loyal consumer base through email addresses.
The new venture is only web based with no effort to launch any brick and mortar stores. The goal to use a lower overhead business model via the internet to regenerate the brand into a profitable one.
Can it be done? Maybe yes, maybe no.
Linen and Things came to life in a robust economy in which consumers couldn't stop consuming especially for their homes. Housing sales were booming and people were spending lots of time in upgraded home environments entertaining and living large. Bed Bath and Beyond created the big box "discount" home goods category and Linen and Things was a me-too follow up.
When Linen and Things business started to waiver, I wrote that one of the reasons it was suffering (and Bed Bath and Beyond was not) was it had no real brand identity. It was just enjoying the spill over from Bed Bath and Beyond and it thrived on sales generated by easily available and plentiful discount coupons (20% off a single item) to spur sales. BB and B also used these coupons, but they were distributed more sparingly. I had at any one time 3 LNT for every 1 BBB coupons. That drove my business to LNT over BBB frequently.
I found the stores very very similar, preferring BBB which seemed to have more higher end goods and an overall better selection. But save for the coupons, I really couldn't see any reason for LNT to exist...other than the sheer volume of people buying stuff for their homes.
As the economy faltered, so did the fortunes of LNT, as has been the case with many me-too brands when consumers cut back spending and the brands with less identifiable reasons for being had little to keep them in business.
Can LNT reinvent itself and succeed just online? I think it can as long as its brand strategists understand they have to create a meaningful reason for being....a pricing strategy that under cuts BBB significantly because the LNT brand's overhead is so much lower?...perhaps offering unique items BBB does not carry that are desired by consumers (yes, consumer interest is key...just carrying different stuff that doesn't sell isn't going to work)....great online service? Top notch experts online or by phone to help with decisions, (BBB is weak in this area both online and in-store)...
I have read that the company is planning to launch a private label brand called, "Linen and Things" as well. That might have some value (if the products are good value) given consumers strong interest in private label brands these days...decent quality and a great price...
Whatever it is, LNT will only succeed online if it develops a core reason for being that resonates with consumers and is significantly distinguished from BBB and any web-only home goods "store". One key competitor in the web only game is Overstock.com which offers an amazing array of home goods for some incredibly low prices. (I recently picked up a high end flatware set for 70% less than a home goods store and 40% less than Amazon.com). So if LNT takes a discount pricing posture they have stiff competition already in the web only marketplace.
I expect more defunct brands to be reinvented but online only.
Watching out for you everyday.
Eli
The recession has impacted many industries and businesses that might historically not have been hurt by a weakened economy. Starbucks which re-defined an entire industry around coffee has seen sales and profits plummet unexpectedly over the past two years along with much stiffer competition from fast food brands like McDonald's and Dunkin' Donuts.
In addition, Starbucks has made many strategic missteps even before the recession in an effort to expand their business beyond coffee and the local gathering spot strategy. Music, movies, casual dining food are among the various "products" the brand has tried to add to its offerings....with mixed results. Most importantly, some of these elements worked to undermine the core brand strategy adding more problems beyond the recession's impact.
Now comes word that Starbucks is exploring new retail ideas but without the Starbucks name attached. Some industry experts think this is a mistake and another strategic blunder. I do not agree.
I have recommended to clients many times over the years the idea of establishing a new sub-brand to introduce ideas and concepts that might undermine the core brand and give an entity the opportunity to reach different/new audiences. The new Starbucks concept is called 15th Avenue Coffee and Tea and will serve food and wine and beer beyond the coffee offerings. 15th Avenue will not have any Starbucks IDs on-site and will appear to be a completely independent concept giving even the most ardent anti-Starbucks consumer an opportunity to experience this brand's new ideas.
Starbucks can use its existing marketing muscle and savvy to successfully launch the new brand quickly if the idea is well received. The initial store is in the home market of Seattle replacing an existing Starbucks location. The company says additional locations will be in new real estate and not re-furbished existing Starbucks.
Success will depend on the actual concept itself, its appeal to consumers and uniqueness as well as how well the concept is executed in its test form.
I look forward to seeing this concept first hand soon.
Watching out for you everyday.
Eli
P & G, the most well known consumer products company and one of the world's largest, producer of brands like Tide and Crest is facing a major challenge. After strategically going up-market during robust times with many of their brands, the prolonged weakened economy is hurting the bottom line big time.
Tide, a premium priced laundry detergent, has seen some of the biggest declines in sales in anyone's memory. So much so the brand is testing a lower priced Tide called Tide Basic in powder form. The idea? To keep the franchise's market-share and loyal consumers as best as possible without losing too many to other price oriented brands.
The problem? The Tide brand was built on the premise it was a superior performing product, one that was used by grandmothers and passed down to mothers and their daughters. It has had strong emotional loyalty unlike any other laundry detergent brand. However, in this new economy consumer buying behavior is changing dramatically in ways most consumer product companies are not accustomed to. Price is the factor even for affluent consumers and product performance and efficacy seem to be less important. The paradigm shift has not been completed making it even harder to gage what steps are best to keep consumers loyal and which to avoid that might cause damage that cannot be undone when the economy improves. Thus, we are in uncharted territory.
With Tide Basic P & G definitely runs the risk of losing its loyalists who have bought the liquid original brand for years. The lower priced brand that has reduced some of the benefits of the original can both undermine the original more so than has already occurred and, more importantly, question the entire brand premise. If you can buy a cheaper version and it is almost as good why then ever buy the original?
When price becomes the brand purchase driver and all other brand elements are not sustained or emphasized the brand becomes a commodity brand and its competition becomes broader and more dangerous.
Let's see how the test does in various cities and we shall revisit this discussion in a number of months. It may prove to be a noteworthy case-study of how to successfully or not successfully handle the new consuming world we have entered.
Watching out for you everyday.
Eli
In a surprise branding move, Lexus has dumped its voice over pitchman of 20 years in favor of younger talent. Although changing voice overs is usually not a big deal in television advertising, the actor who launched the Lexus brand and its "relentless pursuit of perfection" slogan had become a key element of the brand and its identity.
James Sloyan's soothing, elegant, but firm voice became as recognizable as the Lexus car itself. You didn't have to see the ad to know it was for Lexus.
Then imagine my surprise the other day when I heard that same famous voice saying the words, "Lancer by Mitsubishi". I was incredulous. How could that be? I wondered if Sloyan wanted too much money during contract renewals or someone at Lexus had lost their mind? I even wondered if the voice for the Mitsubishi ad was a close copy and not the real thing, but after repeated hearings it was clearly Sloyan's.
Building instantly recognizable brands that transcend the actual media in which they are promoted is not an easy task to achieve and Lexus had made that happen.
So what gives here?
Here's what I learned today from an online automotive industry forum.
February 10, 2009 - A fresh voice narrates the latest commercials for
Lexus. Continuing on that path of "The Pursuit of Perfection", Lexus
has made that change, most recently with the latest blitz of new
commercials for the 2010 RX. There is a new voice in town and like the
previous voice over actor, his name happens to be James too.
Who is this new James you may ask? His name is James Remar. Some of you
may know him as one of Samantha Jones (Kim Cattrall) boyfriends on the
popular HBO show, Sex and the City. He was also casted in movies such
as 48 Hours, The Phantom and also 2 Fast 2 Furious. Remar has narrated
the latest commercial ads for the new RX spots. He will also be the
voice for future Lexus ads.
For 20 years since the inception of Lexus, we have seen, heard and
lived the many "Relentless" and "Passionate" evolutions featuring that
distinct voice. That distinct voice belongs to actor James Sloyan.
Although we will miss the original Lexus voice, we will never forget
those original Lexus benchmark commercials and the regal narration that
Sloyan established for the industry. Think LS400 commercials and the
infamous champagne glass smoothness test. Thank you Mr. Sloyan for all
the years of Lexus pursuits.
"Thank you Mr. Sloyan for all the years of Lexus pursuits"?......wait a minute. This might have been a major mistake for the Lexus brand and a smart move for Mitsubishi. Now, the Mitsu brand gets instant attention for the confusion and increases awareness of its new sportier Lancer model. Yet, Lexus loses a valuable asset especially since this automaker isn't about radical changes it is about evolutionary improvements to a great automobile...staying the course...consistently delivering...so why would one risk undermining the brand strategy by dumping a brand component as golden as the product itself?
I plan to investigate further, but believe this was not a smart branding move.
Watching out for you everyday.
Eli
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