Marketonomy

Do Branded Ticker Symbols Effect Stock Price?

My good friend Victor Cook has a great new post at Customers And Capital rounding up some analysis of the intersection of branding and stock valuation. Victor has been hard at work on the development of an Enterprise Marketing Framework that establishes the connection between marketing expenses and shareholder value. If you're not familiar with his work, check into our book discussion and review of his book Competing for Customers and Capital. It covers critical ground for any marketer planning a roadmap to the boardroom.

In his latest post, Victor looks at the impact of ticker symbols on stock performance and digs up some fascinating studies that show a real connection. It turns out naming your stock symbol something memorable--like Southwest's "LUV"--can measurably improve the performance of your stock over stocks bearing symbols that are easily forgettable acronyms. Exactly why this is the case opens up some interesting avenues of speculation, which Victor outlines before inviting readers to offer their own theories.

Here's mine: Companies that are savvy enough and confident enough to see their stock symbol as a channel to communicate their brand to investors have a more strategic and holistic view of marketing than companies that see their symbol as just a functional index entry. That makes a semantic symbol a marker for companies with more sophisticated and integrated marketing organizations. What do you think?

Check out Victor's post. It's one more stellar example of Victor's work connecting corporate marketing and finance.

The Dell Lemon-ade

I've been offline for a couple of days doing a long overdue computer upgrade, and remembering just how bad Dell's customer service can be. My workstation had been on a long-slow death spiral, and finally crapped out. I ordered one of Dell's high-end XPS machines to replace it, and received assurances it would ship in a week. That's a long time to go without a machine, but it was my fault for waiting too long. So a week passes, and at the end of the day my new machine is supposed to ship, I get an email saying it was delayed and wouldn't be shipping for another week. I do a quick Google and find out that Dell has had problems shipping other machines in the XPS line, and a lot of customers are annoyed with the unexplained delays. Hmmm. Wish I'd checked that sooner.

So I decide to contact Dell and find out why the order was delayed. There was no reference phone number or link in the failure-to-ship notice, so I go to Dell.com.  When I get to the site, the option at the top of the contact list is "chat". Cool. I won't have to wait on the phone, or wait for an email response. I click on chat, and they ask me to put in a customer number or order number. No problem. I dig out my customer number, enter it, and get a reply that says "The Chat Service is Not Available to You At this Time". Excuse me? You just charged me over $2k for a computer, failed to ship it, offered no explanation or support number in the notice, and now you tell me I don't qualify to talk to a service rep online? I'm instantly pissed off. I go on to the next option, email, and send a succinct query asking them to explain the delay so that I know whether I can rely on the new date, or if I need to make other plans. Dell never responded.

The computer did ultimately ship 2 weeks after the order, and I'm happy with the product. But man, I hope I never have to rely on Dell's customer service.

So I'm telling this story to a buddy of mine who runs IT for a mid-sized company. He has a lot of Dell machines in his organization. Like me, he's pretty solid on the product, but he has a very jaded view of the organization. Recently, he's had to deal with the laptop battery debacle--if you haven't heard, you may be at risk of spontaneous combustion. Although the problem with the batteries originated with Sony, Dell was complicit in waiting out a recall of 4.1 million batteries until there was real, live evidence of catastrophic danger.

My friend, who isn't usually prone to conspiracy theories, but as an IT manager is over-exposed to aggressive marketing, perceived a marketing agenda in Dell's recall program. The way he describes it, enterprise customers with a lot of laptops were instructed to pass the recall notice on to each end user. Dell would handle the inconvenience of desktop support for the recall by dealing with each end user directly. I wouldn't have thought much about that, but my friend immediately balked. Why, as a responsible IT manager, would he help open up a direct channel  to his entire company's staff for Dell? I kind of marveled at his paranoia for a moment, but then I thought about the numbers. Millions of users hidden behind a corporate IT firewall, and a recall campaign financed by Sony. Maybe that's how you make lemonade out of 4.1 million lemons.

 

Brands with your Breakfast

In what may very well turn out to be the most brilliant idea in modern marketing, CBS will unveil a new advertising platform this year: your food. It seems the vast mix of conventional advertising mediums--like print, television, radio, Internet and outdoor--is just too shallow to effectively deliver everything the CBS brand has to offer. So starting this fall, CBS will be coming to you directly from your refrigerator, as a laser imprint on your eggs.

Responding to the overwhelming crowd of entertainment ads in newspapers, magazines and Web sites, George Schweitzer, president of the CBS marketing group, decided it was time to think out of the box and really get in your face. "You can’t avoid it,” Schweitzer chuckled.

The inspiration for the experiment apparently arose from the dismal lack of promising programs for the fall line-up. Without the quality programming to draw bigger audiences, CBS has shifted funding priorities to marketing in order to build positive brand associations through aggressively intrusive messaging.

The tactic has already given new life to CBS's staff of writers, who are referring to the medium as egg-vertising. Newly inspired slogans are said to include: "CSI” (“Crack the Case on CBS”); “The Amazing Race” (“Scramble to Win on CBS”); and “Shark” (“Hard-Boiled Drama.”), while ads for new comedy shows include “Shelling Out Laughs,” “Funny Side Up” and “Leave the Yolks to Us.” Plans are said to be in the works for a new police drama with an ironic edge based entirely on breakfast puns.

The egg advertising follows months of research and development into food-born messaging, with CBS now positioned to corner the egg-messaging market, and staking initial claims in breakfast produce and meats.  While basking in the glow of this masterful stroke at CBS, Mr. Schweitzer remained modest. “I think, it’s like, you know good ideas when you see them.”

Targetted PR Messaging

A couple of people responded by email to my post about Segway--where a PR rep at an obscure industry vertical tradeshow made Segway sound like an obscure product for an obscure vertical during an interview with National Public Radio. What *should* she have done--give up the opportunity to get Segway's name out over the national airwaves?

No. The problem is more strategic than tactical. If you're making an investment in PR, you should be working with a company that understands targetted messaging and how to deliver it. The message you position with a trade press journalist is not the same story you deliver to the general business media, much less a mainstream consumer audience like NPR. You and everyone who represents your company should have a playbook of targetted messages for different media outlets and journalists, and you should have it memorized.

When a reporter from NPR showed up at Segway's booth, Segway's representative should have had a message ready for a national audience, or she should have phoned home for support. Instead, Segway blew an opportunity to connect with one of the nation's largest audiences of educated, affluent and environmentally aware consumers--exactly the audience Segway needs to connect with. Those are the kinds of mistakes you can follow right to the bottom line.

Take Me Out to the Small Game

I'm going a little far afield today. Stay with me, it'll come full circle.

I've been following the recent revival of the Barry Bonds doping scandal with the release of the investigative book "Out of the Shadows". I'm one of those Giants fans who's been in denial. I watched with incredible fascination as Bonds kept dominating the plate and sending the ball into the stratosphere like a vision from every little leaguer's dreams. It was magical. And it wasn't too hard to write off the accusations of doping as the whining of detractors.

Now, the evidence is too overwhelming to dismiss, and I wonder how I could have ignored the obvious for so long. I mean, come on, an aging athlete becomes a hulk overnight and pops his batting average to record heights? What kind of collective fantasy are we all living that we refuse to confront such obvious red flags? Where was the mainstream sports media? Where was Major League Baseball? And more to the point, where are they now?

This year, I'm really torn about taking my 5-year-old son to see the Giants. I know he's not old enough to understand a scandal, and he'll bask in the atmosphere of a Saturday game at the park. But I'll be stewing in the knowledge that it's just another cynical industry that looks the other way when tickets are being sold.

And here is where this comes full circle. As crazy as this may sound, it seems to me that Bonds is a metaphor for the worst in Capitalism. The short term gain is relentlessly pursued even in the face of long-term loss. Bonds gave us a few seasons of magic. And now there will be a long and painful hangover. We may have bought a lot of tickets then, but how many people will be disillusioned this season and look somewhere else for inspiration? How many people will never look at baseball the same again? And how many people will start to doubt other heroes? Lance Armstrong, anyone? Too good to be true?

I sat with my son last weekend in the bleachers at a local high school game, and after a few minutes soaking up the atmosphere of a small local game, I started wondering if any of those high school kids were using steroids, or how long it would be before they would be tempted. I feel like I've lost something of value--not just an experience of something magical, but a belief that the magical is real, that it's possible. That's now replaced with a sense of cynicism and disgust. And you can bet there's a real dollar value to that feeling, especially when it's aggregated over a mass market.

So. Was it worth it? How will the balance sheet for Baseball look after this scandal finally settles? Think about it. Beyond the disillusionment and disgust, Baseball, and most sports for that matter, have cultivated an unsustainable appetite for super human feats. Without chemically enhanced super athletes to make it all so exciting, what segment of the commercial fan base will wander away, bored by the banalities of a normal season?

Why does this look so much like a metaphor for business to me? I believe in the strengths of Capitalism, but watching what's happening in the confluence of Big business, politics and entertainment--how everything is so relentlessly short-sighted, mindlessly selfish, and cynically amoral--I can't help wondering what, beyond the bottom line damage, we're losing with each new scandal. What new hope will be replaced by cynicism and disgust? And in the end, what faith will we have left to invest in achieving the impossible?

Before you go off and slit your wrists, let me say that I'm not a cynic. I don't believe all is lost. I just think we're deluded in believing that reform will come from the government, from business, from Hollywood (no, not even George Clooney), or from religion. Change in our business culture is only going to come from the fringes, from the individuals and the small businesses that will grow larger by doing things different, and by investment from people who want to see those changes succeed.

My big burning question for the day--and I invite comments so I can see some examples--is what businesses or institutions do you have faith in today? Who's doing something right that we should all know more about?

If Microsoft Repackaged the iPod

Good parody says more--and more effectively--than any rant, review or analysis.

This send up of Microsoft's packaging design approach is brilliant. 

Marketonomy One Year Old

I was looking at my blog's statement of purpose yesterday--to see if I was still relevant--and noticed that Marketonomy has just hit the one-year mark. Since no one else will stand up and cheer: yippee.

Quite a lot has happened in the past year. I left the marketing agency I helped to found, Cymbic; I joined the CMO Council and it's corporate parent, GlobalFluency to help drive global expansion; I quit BusinessWeek Online and joined Executive Decision Magazine as a columnist and commentator on marketing; and I had a blast participating in various marketing events and conferences. All the activity has made it hard to keep posting regularly, but it's been a fascinating exercise in finding the right voice. A lot harder than writing a column or feature story. I'll have to put some thoughts together on that topic--the advent of blogging puts an interesting twist on the concept of the public sphere...

I've got my first article out in a new gig writing for Executive Decision Magazine. Check it out and let me know what you think.

Killing Brand Barbie

Researchers in England have just released a report that, among other things I hope, documents the phenomenon of Barbie mutilation among young girls. It turns out young girls think Barbie torture is cool, especially when it involves burning, breaking and even microwaving.

Only a neurotic parent or the NSA would find this deeply disturbing. My brother and I favored fireworks and liquid flammables for torching our toys as teenagers, and I suspect it's a time-honored rite of passage. But what stands out in this study from researchers at the University of Bath is that Barbie leads the pack as the favored torture victim.

Researchers from the university's marketing and psychology departments questioned 100 children about their attitudes to a range of products as part of a study on branding. They found Barbie provoked the strongest reaction, with youngsters reporting "rejection, hatred and violence," researcher Agnes Nairn said.

"The meaning of 'Barbie' went beyond an expressed antipathy; actual physical violence and torture towards the doll was repeatedly reported, quite gleefully, across age, school and gender," she said.

I'm usually frightened when marketers and psychologists team up to study kids, but this is fascinating. What on earth, beyond simple joys of teenage sadism, could provoke such a visceral hatred for Barbie? The mind reels.

Matel took it all in stride, however.

Manufacturer Mattel, which sells 94 million Barbies a year worldwide, said the doll remained the "No. 1 fashion doll brand." Mattel U.K. said that despite the findings of "this very small group of children, we know that there are millions of girls in the U.K. and across the world that love and enjoy playing with Barbie and will continue to do so in the future."

With sharp knives and lighter fluid.

Wouldn't that be a cool Barbie accessory kit? 

A Virgin Eye for Design?

Virgin has just announced the location of its new Virgin Galactic headquarters--a spaceport somewhere south of nowhere in New Mexico, where consumer-grade astronauts can take a ride into space. I have no doubt that some day my 4-year-old son will be able to fly into space, and it's exciting to see the first steps take shape.

Virgin also announced it's new corporate identity, which is a little less exciting.

The concept is interesting, but the design doesn't work at all. For starters, the concept only works well on a black background: it's supposed to be the pupil of an eye incorporated into a solar eclipse. But on a white background, it just looks like an eyeball with "Virgin" tatooed on the pupil. Even if the concept did work on white, the design wouldn't. Can you imagine trying to size this for letterhead? The image would be reduced so much that Virgin would be unreadable. The "Ga" in Galactic is already unreadable layered over the iris. It looks like "Virgin Lactic"... a new milk product? Then you've got the nightmare of reproduction, with hundreds of gradients in the iris that will make all but the best printers reproduce a muddy mess. How will it reproduce in black and white? In knock out? In a vertical lockup? It looks cool on a black Web site, but I can't imagine this being used successfully as a corporate identity.

Why am I taking the time to comment on this? This is classic form over function design, which eventually hampers good marketing. Someone was married to a concept, damn the consequences. I wonder who.... They say that Richard Branson's iris will be used for the final logo. It kind of makes you wonder if the whole Virgin Galactic operation isn't a little heavy on concept but light on actually making the details work.

Googlemyopia

I had a funny conversation with a sales rep from Google who called to sell me on reselling AdWords and AdSense. She was smart, well informed on Google's offering, and pretty well briefed on the company I work for. But when I told her Paid Search and SEO weren't on the roster of services I would be offering in 2006, she went, like, totally blonde on me. "You're a PR and Marketing firm, right?" Yes, I confirmed, and we don't do search marketing. She barely concealed her incredulity, circling back to the beginner's pitch to introduce me to AdWords. Yes, yes, I know. Great stuff, really. No, not interested, thanks. But if you want to send me some material I'll keep it on file. She couldn't resist confirming one final time, "You are a PR firm...right?"

Yes. I know Google is a really big phenomenon, and I know AdWords is critical for generating topline revenue at many companies--especially if they happen to be selling something like refrigerator magnets or life insurance. I've advised businesses spending 10s of thousands of dollars a month on paid search, and others spending over $100k on SEO. When something like 80% of all Internet traffic begins at a search engine, it's a good idea to understand how the game works. But--gasp--I don't think it's the end-all, be-all marketing strategy for most businesses. This seemed to come as a genuine shock to the Google Ad Rep. As if, what else is there?

Well, I think the biggest What Else is what seems to be a rapidly resurging relevance for Social Marketing--a marketing approach that focuses on meticulously cultivating relationships with a selected audience rather than trying to push a critical mass of anonymous and abstract targets through a response filter. As effective as AdWords is today, it still represents a paint-by-numbers approach to mass marketing that won't stand on its own in a world where users have on-demand access--through Google, no less--to hundreds of data points on your product from media sources, expert reviews and countless peers. Businesses are rapidly losing control of their own message, and channel efficiency isn't going to solve the problem.

I'll post more on this after the CMO Summit in Monterey this week. For now, I'm not sure whether I'm captivated more by the Google Ad Rep's inability to conceive of any marketing tactic beyond Search--are they really that self-inflated?--or by the thought that she was so incredulous because she doesn't come across any other companies that question Search's omnipotence. That can't be true. Can it?

Marketing Mindshare

I'm at an event in Boston this week for senior marketers--a week long summit of targeted sessions on everything from Competitive Intelligence to CRM optimization. It's an interesting crowd--maybe 200 or so marketing executives and 30 vendors. The event is hosted by Frost & Sullivan, and I'm actually here to support the marketing and sales team of one of my clients, Leverage Software.

The event is pretty well produced as far as conferences go--the venue is right on the harbor, the networking is well facillitated, the crowd is highly qualified and strategic--nicely done. My only complaint is at a much higher level. When you get a few hundred marketers in the room together and start threading the crowd to network, you get a really good sense of the current position of marketing evolution. There's certainly a lot of activity out there--busyness--but the signal-to-noise ratio isn't what I would have hoped by this point.

Here's the problem: While the activity of marketing is changing, the mentality is too much the same. The activity of marketing today is focused on accountability, metrics, ROI. It's all about efficiency. If marketing can line 100 ducks up on the fence, sales can shoot 1.5 of them. And the big objective of today's marketer is to improve that ratio to 1.7.

What few marketers seem to appreciate is that you can be remarkably efficient at serving your market poorly. The mentality needs to change from shooting a fraction of your ducks and calling that success, to gathering those 100 ducks off the fence and cultivating them into a channel that can consistently offer up 1.5 new customers, without making the other 98.5 gun shy. You do that by engaging with your market, cultivating peer connections, collaboration and dialog--not by spouting positioning messages and applying your cookie cutter qualifiers. That, by the way, is why we're here with Leverage, because they provide software that enables such an approach.

As a blog entry this is oversimplified to the point of being parody. But I just want you to know that I'm milling around this show with a highly concentrated crowd of high-level marketers--and as events go, it's a decent one--but it feels like there's not enough octance in the fuel.

Brand Awareness

My son just turned four. Like many little boys, he has an insatiable fascination with cars. He has enough Hotwheels and Matchbox cars to reenact the morning gridlock from my house to San Francisco, and he can recite the type and model names for many of them. One of his first prize cars was a scale model BMW sedan his grandmother picked up in a garage sale when he was two. He loved the tires and wheels off that car, and still scraped it passionately along the hardwood floors. As a result, by the time he was two and a half, my son could pick out any BMW from 50 yards.

At first, he just noticed BMWs of the same model as his toy car. But then he started identifying other models of BMWs. He even called out excitedly when he discovered his first BMW motorcycle. It was, of course, the distinctive logo he recognized, and flawlessly attached to the BMW name. After BMW, he latched on to the Lexus brand--a simple oval with an "L" that was easy to pick out from a distance. After a while, he would sit in his car seat as we drove through town, happily calling out every brand he recognized.

Now I'm no Piaget, but I'm fascinated at how my my son has utilized different shape recognition strategies to distinguish different brands, and what it says about the power of corporate identity. For example, while my son latched on easily to brands like BMW and Lexus, which have simple, distinctive symbols that are easy to recognize, he resorts to the shape of the car to identify models that lack such apparently powerful symbols. And guess what? He often gets those wrong. He often mistakes Ford, Chevy and Jeep SUVs--but he never mixes up Toyota and Lexus SUVs, which both use very similar bodies.

Close your eyes for a minute and try to envision the Chevy logo. Not very memorable is it? Ford and Jeep are simpler, but they are wordmarks rather than simple symbols, and my son isn't quite at the point of reading. The only American car my son can consistently recognize across all body styles is the Mustang, which features a running horse as the model's logo.

What does this all say about corporate identity? Well, I bought my son a bicycle for his fourth birthday. A Schwinn. The weekend after I set up his bike and took him for his first ride, I took him to Target to buy a pair of little riding gloves to go with his helmet--if he's anything like me, he'll be hitting the deck a lot. As we were looking through the bike accessories on the rack, my son pointed excitedly to a pair of gloves on display, and said those were the ones we had to get. I had a different set in my hand already, but he was adamant. When I asked why, he pointed to the Schwinn logo and said they "went" with the bike. The Schwinn logo is another simple symbol--a cross in the middle of a circle.

So here's my pop-psychology hypothesis. Clearly, even at an incredibly early age, we attach symbols and experiences. If there's a strong symbol to go with a strong experience, it seems to dramatically simplify the process of identifying and attending to objects in an environment of overwhelming stimulus. If there isn't a strong symbol available, we fall back on other pattern recognition strategies, but they're not as effective. When you attach this to buying behavior, an underlying process of decision-making seems to be pattern familiarity and matching, which, in the absence of some kind of rational basis for discerning between options would lead you toward selecting the familiar by default. 

I have no idea how this gets tempered as you grow older and have to parse all kinds of marketing messages, peer pressure, and socio-economic data, but it's fascinating to me that underneath it all, at the simplest level of mental operation, we're certainly cataloging symbols and attaching them to experiences, and in some way those processes influence our behavior.

Apple's Core Positioning

I went to a business rountable last week in San Francisco, and found myself sitting around a table with a group of senior marketing executives talking about various issues in pop marketing. The topic of Apple's incredibly successful run over the past few years came up, and the popularity of the iPod. One anecdote in particular made me start thinking more critically about Apple's current position, and how that might change as they take on more visibility and more market share.

One of the guys at the table was shopping for an MP3 player for his teenage daughter. When he mentioned the iPod, she screwed up her face just as you would imagine a girl would if her father offered advice on fashion accessories. "I don't want an iPod. Everybody has those." Apparently, the cool brand among her friends was anything but an iPod. She ended up falling in love with a Zen from Creative Labs.

A little red light started glowing in the back of my head when I heard this story. There have been a number of interesting PR threads over the past few months involving various growing pains for Apple: their shift to Intel chips; an increasing virus threat as their OS gains market share; their lawsuit against three journalists for uncovering future product plans; closer scrutiny into Apple's environmental record, and some complaints among music fans about iTunes' business structure. None of this is too surprising: Apple is a large company on a tear--their stock has doubled in the course of a single year. Along with all the glowing coverage about how Apple is shaping popular culture, you expect a fair amount of critical coverage as well.

What interests me about this anecdote, though, is that it cuts to the heart of what has always been Apple's brand--the cool factor. Apple has always put a lot of resources into design aesthetics, and with good results. They've been the creative light in the middle of a technology industry dominated by Bland. But the more technology becomes mainstream, and the more marketshare Apple gains of that mainstream, the more ordinary Apple's image becomes.

I'm sure no one at Apple is losing any sleep over their image--they have a strong sense of identity, and good retail brands like Apple are very adept at reinventing themselves to stay fresh. But Apple's rapid growth is going to change the dynamics of brand marketing significantly. I'm sure Design will remain at the core of Apple's brand image, but it will be interesting to watch their positioning moves over the next year to see how they adjust to a growing presence in the mainstream. What does it mean to Think Different when every third person in your Subway car is wearing a set of white ear buds?

Thought: A propos of "Think Different", does anyone know if the genesis of that tagline was a response to IBM's longtime motto "Think"? Apple was often going after IBM aggressively in their ads (remember the toasted bunnies?), and it's typical of their strategy, but I've never seen anyone parse it specifically.

Brand Design

I've got a new column up at BusinessWeek, focusing on the process of creating a brand. It's causing me no small amount of grief trying to serve up functional value in 900 words. Opinions are easy in that amount of space, but functional substance is difficult, unless you spread it over many installations. It's humbling that in my 3rd year of writing that column, I'm still learning how to work the medium effectively.

My biggest fear is that the column was more interesting to write than it is to read. I've had the tremendous privilege of working for the past seven years with two of the best strategic designers in the brand game--Russ Baker and Kenichi Nishiwaki--and learning firsthand just how strategic design can be in crystallizing the value a company provides to its customers, not to mention galvanizing the corporate culture. For so many of the clients we've served, the aesthetic process of determining their corporate or product brand was a seminal experience--a rare opportunity for the company to look in the mirror and make critical discoveries about who they are, as well as choices about who they want to be. There's very little patience for that kind of process these days.

Let me know if the column stands on its own. If not, I'll push on some the ideas a little more, and maybe even rope Russ and Kenichi into offering some of their own thoughts.

And the Brand Played On (and on)2

I guess the debate isn't over. Jennifer Rice at BrandShift is taking up the dialog on the meaning of brand. The crux of Jennifer's argument is that the definition of "brand" as a tangible symbol that distinguishes one company's products and services from the competition is too narrow--and too "company-centric". She argues that we should understand "brand as an idea".

Let's take a fictional character called Joe Shmo. Joe works hard to cultivate a reputation as a smart, well-connected and savvy business professional. He believes that these qualities represent his personal brand. Unfortunately, those who know Joe say he's overly opinionated, boorish and irritating. They believe that's Joe's brand. Who's right? Joe, or those who know Joe?

The answer is, both are right. Christopher would say that others' opinions represent 'brand reputation,' not the actual brand. I say that a brand is worthless without understanding how the brand is perceived in the marketplace. A brand is the ultimate co-created corporate asset.

I'd prefer if we started instead with an analogy that is actually a business. One of the posters on this blog, Sage, offered an analog to Jennifer's example with Enron.

Perceptions change. Brands do not. Want proof? Enron circa 1999 and Enron today. Same brand. Totally different perceptions of the brand.

A tangible definition of brand is the cornerstone that allows us to make distinctions about what adds value to the brand and what does not. I'm not arguing with Jennifer's ideas about the importance of the customer relationship in developing brand equity, but if the meaning of "brand" is to be understood to encompass everything that influences or increases its value, than the word has no identifiable boundary. Yes, a brand is worthless without understanding how it is perceived in the marketplace (or at least worth less), just like a car is worthless if there's no gas. But we don't say gas is the car. It is a distinct, critical component of the system that makes the car useful. Just like brand image--that idea in the mind of the customer--is a critical component of the system that makes a brand valuable.

I think a lot of people reading my posts have come to the conclusion that I'm denying the importance of the customer relationship in building a strong and valuable brand. Nothing could be further from the truth. I am *only* arguing that we have come to a point in the evolution of marketing where our imagination has run headfirst into the brickwall of rational necessity. Marketing exists as a corporate function--if the company stops investing in the marketing budget, the customer is not going to come in and pick up the tab. Companies are increasingly confused by marketing concepts--not because they are wrong or misguided, but because they are poorly communicated, inconsistent and detached from a demonstration of measurable value.

The idea that a brand is an image in the mind of the consumer, that it is co-created with the customer, is a great strategic concept that can help businesses get beyond a product-centric focus that leaves their customers uninspired. We need more of that. But at the same time, we need to understand that just as companies live or die by the satisfaction of their customers, they also live and die by the satisfaction of their investors. Companies are being pressed to wall to demonstrate *how* value is created, and when 10-50% of revenue is going into marketing, they are not going to countenance marketers continuing to say that brand is some ethereal idea that can't really be pinned down but we think it's in the mind of the customer.

Company centric? Yes. That's who pays the bills. The marketers who make real advances in building a customer-centric landscape will be those who understand that fact and are able to keep it in balance. The first step down that path, in my mind, is the kind of professional discipline that insists on semantic clarity so that we can all communicate knowledge and ideas consistently without having to spend most of our energy recalibrating meanings.

If you want to insist that "brand" means more than it has been both traditionally and professionally  defined to mean (AMA)--ie: a symbol--than you need to demonstrate 1) how that meaning is insufficient, and 2) how the existence of related, but distinct concepts, fails to address that insufficiency.

 

And the Brand Played On (and on)

Alright. I can finally start putting the semantic argument over the meaning of brand to bed. My column finally posted on Business Week, after a week's editorial delay left me twiddling my thumbs. I'm certain there will still be some semantic discussions in the weeks ahead, but I think the foundation is layed and it's time to move on.

One interesting note on this whole exercise. After digging so relentlessly into the confusion over the meaning of brand, and then stepping back from it, the whole process of how we got to such confusion seems suddenly so clear. Brands as important commercial symbols have been around since ancient history. But an appreciation for the critical value of brand to commercial success really exploded during the rise of mass markets after World War II. At that point, we started developing all kinds of approaches to building value in the brand--from enhancing the relationship between the company and the customer to developing aggressive competitive strategies. So far, so good.

The confusion arises when we start to believe that activities that *add value to the brand* are in fact *creating brand*. At that point, we can start to make the argument--as so many marketers do today--that *any* activity that adds value to a brand is really producing the brand. And since so many activities that add value to the brand produce so many disparate things, each of those things suddenly becomes invested with the title of brand, and we no longer have any clarity. It only gets worse when you realize that many of those activities are owned by competing camps within marketing (advertising, direct mail, interactive, design, etc.), and each has a vested interest in staking their claim to the role of Brand Creator.

Well, I've made my argument. In many ways, it's less about the meaning of brand than it is about the future of marketing. Do we have the capability to sort through the confusion we've created and clarify the concepts that define our profession so that businesses understand the value we provide? Do we have the ability to even recognize there's a problem at all? Or will we wind up pushing a shopping cart down the halls of corporate America babbling on to ourselves about how important we are while everyone looks at us with a mixture of sadness and disgust? Really, it's an unkind metaphor, but that's what's at stake.

Papa's Got a Bland New Brand 2

I just got off the phone with John Winsor. We had a great conversation about brands and marketing, and we're essentially on the same page. He posts his own response to my comments here. I have to say what I appreciate about the whole experience is finding a thread online that leads to an open and engaging discussion, less about "what's wrong" with marketing per se than about how marketing can be done more effectively.

John's focus is on the development of *real* interaction between marketers and their customers, rather than the relationship-by-proxy that happens through agencies, focus-groups, surveys, etc. He talks about going Beyond the Brand (ie: the hype of branding) by changing the one-way flow of marketing communication--the broadcasting of a pre-fab message--to a two-way dialog with customers. I can't argue with that--in fact, I'm looking forward to more of a dialog with John in the future.

Papa's Got a Bland New Brand

This is unreal. Over at Corante's BrandShift blog, John Winsor is arguing that the word brand has become too stale to be useful, and that we need to come up with some *new* special word that infuses new life into what it is that marketing does.

The word brand has started to loose it's magic through overuse. Is there another word that captures the same concepts? If so, what is it?

Is this really the face of marketing today? Is this the best we can do? Apparently, the way to solve marketing's shortcomings is not to dig deep in order to understand how we are failing to provide real value and how we can improve; the solution is to just toss away the old paradigm and create something new and shiny. A new word will solve all our problems and make it all magical again. 

*This* is exactly what I've been ranting about for the past few weeks. I am extending an invitation to John Winsor--and anyone at Corante--to dialog on this topic and explain their point of view. I'll keep you posted on whether or not we can get something going to get to the bottom of this.

--Update--
I should have mentioned in the post that Winsor was picking up the call for a new word for Brand from a William Safire column  that makes the same case: "brand" is bland, let's have something new. That doesn't change my position--I could add to it by saying marketers probably shouldn't be taking professional cues from William Safire--but the original column is relevant to the discussion.

From Brand to Branding

Out of the frying pan and into the fire. I posted my final Business Week column on the meaning of brand--I'll post a link here when it goes live--wrapping up my argument for a concrete definition, while unavoidably opening another can of worms. If a Brand is a tangible symbol that distinguishes one company's products from all competitors, what is Branding?

A couple of years back, when The Industry Standard was still a 150-page print magazine (remember that?), I had an animated discussion with one of the editors about "branding". They had done a special section on the topic, and every single one of the articles was on advertising. At the time, my company was heavily engaged in interactive development, and I was making the argument that the creation of an online experience was every bit as important a branding activity as advertising--in fact, for some companies, it's the most important activity. Yahoo, eBay and Google all became household names because of the experience they delivered, not their snappy ads--which didn't even begin until after they had made their mark.

I'll still make the same argument today--although I no longer try to claim that the experience you create *is* your brand. Your brand is still the symbol, but the experience enhances the value of the symbol, both for you and your customer. In fact, all of the activities that a company engages in to maximize the value of the company/customer relationship, in my mind, fall in some way under the category of branding. Take Customer Service as an example. To some degree, Customer Service is just Customer Service--it's providing accountability for a product according to the service contract. But to the extent the company realizes Customer Service is a critical touchpoint with valued customers, and invests in going beyond basic accountability to try and influence the customer's perception of the company--by having intelligent operators answer the phone, by offering a replacement product, whatever--any returns on that investment accrue to the brand.

So, what is the definition of "branding"? No help from the AMA here, they don't have it in their dictionary. If you use Google's helpful "define:" command, you come up with a reasonable grabbag of definitions --many of which simply revert to "brand". But building on the original cowboy definition of brand as the symbol, and branding as the act of applying the symbol, we could follow the same approach in business:

Branding is the set of activities that serve to create or build the brand.

As most companies know today, the relationship with the customer permeates far more of the company's operations than just marketing, sales and service. For some companies, the way you answer the phone is key, for others, it's the way you drive your trucks. For some companies it's your Web site experience that influences customers most, for others it's the fact that you invest some of your profits in charity. While some activities are pure acts of branding--like advertising--others may be more subtle but equally important. Whatever the activity is, to the extent you go beyond the function of the activity itself to try and improve your relationship with customers and prospects, it is, I would propose, branding--the activity is designed to add value to your brand.

I can already hear the mail coming. If you know of a solid and authoritative definition of branding, please let me know and I'll post it. If you have a good argument for why branding should be more limited, or more expansive, likewise. There's a lot of ground to cover...

Tripping (over) the Light Brandtastic

I'm working on my next column on brand concepts, sifting through a lot of the complaints that have been leveled at my reductionism (that every instance of brand is, by definition, tangible).

Most of the people passionate enough to send me hate mail complain that I'm oversimplifying the complexity of marketing. Apparently, because I'm arguing that the definition of the word *brand* should be understood in its simplist form, these people make the knee-jerk assumption that I'm cynically tossing out all of the other concepts associated with brand building--like the CFO with horns and a pitch-fork that must be haunting their dreams. Is it possible that the universe can contain one core concept for brand that is concrete, and also accommodate derivative concepts that are *distinct* but arrayed around the core? Heavens no. Everything must be lumped into the vague domain of a single word. It's like brand has become the magic bag of Felix the Cat--it can be anything you want it to be.

Others, like the letter sent to my editor at BW (the one from Gaurav Bahirvani), go a step further by mounting a defense for the soft subtlety of marketing that defies quantitative analysis:

I disagree with Kenton regarding marketers not being adept at demonstrating return on investment. Marketing or branding is a qualitative aspect. It is not a 2+2 sum which will give you a definite answer. In marketing, you're playing with emotions and human psyche, not numbers.

Okay, let's parse that for just a moment. He disagrees with the notion that marketers aren't adept at proving ROI. My assumption would be that he would follow that statement by showing how, in fact, marketers are good at proving ROI. But no, he mounts the defense that marketing is about emotions and human psyche, not numbers. Which, I guess, is a proposition that marketers should be immune from having to prove ROI. Why? Because it's too hard to give a definite answer.

As a businessman, if you're on my payroll you need to show me why putting a dollar in your budget is a better bet than putting that dollar in the stock market--or in the lottery, for that matter. As long as marketers argue that they are entitled to immunity from quantitative performance review, simply because they're dealing with something that is hard to measure--and that everyone else should just "get it"--they're lemmings: they're apparently ignorant of the tidal wave of marketing metrics and accountability measures that are sweeping through the business world. Sarbanes-Oxley anyone?

Finally, there are those who will accommodate me, grudgingly, as some curious fundamentalist. They're not quite sure why I'm insisting on this line of argument, but they'll grant that I'm not entirely wrong even if I'm not entirely right. The most gracious of these is over at hypocritical, which goes into some interesting detail about the mindset of marketers who are arguing against me.

Here's the thing. He's not wrong. He just has a different semantic argument for his definition of the word "brand." It happens to be completely at odds with my definition. And that, to quote Stuart Smalley, is okay.

My whole point has been that it's not okay. And this is the heart of the problem. Please understand this. I AM NOT ASKING YOU TO AGREE WITH ~~MY~~ DEFINITION OF BRAND. And I, personally, will not countenance your creation of a NEW definition of brand. Why? I'll be the *first* to champion a living language in which words can be created, modified, exploded--we didn't get to 100,000+ plus words in the English language by insisting on stasis. But when you get to the point of MASS CONFUSION, you must stabilize the language you use to communicate and transfer knowledge, or you embrace intellectual oblivion.

The simple fact is that the standard definition of brand, the one that defines a brand as a symbol that sets one company's products apart from competitors, is entirely serviceable today in 2005, and the attempts to push derivative concepts into the meaning are self-serving, egotistical and misguided--not to mention professionally suicidal.

The heart of the problem, to me, is this: Marketers have creative minds that are able to see many shades of gray. There's a lot of value in seeing the nuances in life--it allows you to apprehend patterns, to anticipate trends before you see the numbers, to see more than those who can only see black and white. But there comes a time when so much gray becomes impossible to navigate. We talk past each other like a bunch of babbling idiots, each asserting our own spin on the grayness, our own self-congratulatory definitions. At that point it becomes necessary to step pack, to prune the vast overgrown tree and pare it down to the strongest branches.

My entire argument is that that time is now.

Brand Semantics 102

I'm still getting a lot of contact on this topic, ranging from encouragement to head scratching--with a few good flames to keep things entertaining. I'll be moving up a level in brand exploration with a new Business Week column next Tuesday, but in the meantime, Jason Kerr picks up the semantic thread over at Brandlessness, scrutinizing the reduction of "brand" to the foundation of tangible assets.

I intuitively agree with you that a brand is what it is. A taxonomic anchor. But which one? You said it's "your name, your logo, your trade dress.." Well which is it? If a brand is "a concrete thing," then it's a concrete thing.  BUT if you define it as a set of different concrete things that share a common idea, well then...  it's an abstraction.

That's an interesting distinction that could take us deep into semiotics, at which point we might as well just shoot the audience. Let me try framing it like this: all dogs are mammals, but not all mammals are dogs You can certainly say that "mammal" is an abstraction--a title for a group of things that hold a common quality--but you know that every single mammal, whether it's a dog or a cat or a blue whale, will be tangible. Same thing with brand. A logo is always a brand, but a brand isn't always a logo. It can also be your name, your trade dress, or one of a number of  touchpoints. But if it's not a tangible symbol that distinguishes your products and services from all others it's not an example of brand.

So yes, technically, the word brand signifies concrete things without being concrete itself, and yet, it's used interchangeably with the concrete things it signifies. If I walked my dog, you wouldn't correct me if I claimed to be walking a mammal--although in that example, you'd probably think I was a little whacked.

Beyond Brand Semantics

I took the rant on marketing semantics to my Business Week column today. I never imagined such a seemingly simple issue would have such legs, but the resistance I've gotten from some quarters--dismissiveness, anger, derision--is unusual. There are a lot of marketers out there who don't want the boat rocked.

But the struggle over the meaning of Brand is only scratching the surface. There are many concepts in marketing that are equally vague or confused, or conveniently reinterpreted to fit each marketer's understanding or expertise. Depending on who you're talking to, Segmentation can mean either market segmentation or segmented pricing. Positioning can refer to a competitive market strategy, a marcom messaging strategy, or even brand image.

In a conversation, the multiple meanings of a word are usually stabiliized by context. If I say "grab the wheel", and we're sitting in a car, you'll know I mean the steering wheel. If we're outside the car changing a flat, you'll know I mean the tire. Using context, experience and inflection to determine what meaning of the word was intended doesn't change the meaning of a concrete thing. A tire is still a tire, and a steering wheel is still a steering wheel. But what happens when the word is referring to something that is no more solid than an *idea*? What happens to the idea of segmentation, or positioning, or brand, when, through my own channels of experience--through context, inflection, etc--I interpret the meaning in a way that is different? What happens when I downright confuse one meaning with another, and then transmit that confused meaning to someone else?

In an age of Information, when we make our living as Knowledge Workers, what happens is that we fill our universe with static. Knowledge is shared through the use of language, and if the language isn't sufficiently clear, it's like we're talking to each other over a bad connection. In the short run, it's merely annoying--your clients or colleagues don't fully understand what you're saying. But in the long run it's destructive. People who are not marketers, but who depend on interacting effectively with marketers, begin to lose confidence in the value of marketing because every conversation is slightly vague, slightly confusing--and more troubling still, the meanings of important concepts seem to change from person to person. That lack of clarity and credibility has become the brand image of marketing, and until we get clear in our communication, we stand little chance of improving it.

If you're coming in from BusinessWeek, welcome. I'd really like to get more of a dialog going than a rant, so please drop a comment, if you would. Thanks for reading.

More Brand Definitions

My business partner pointed out "Exhibit B" in the ongoing fight over defining the meaning of "Brand". Over at Corante's blog on branding there's a discussion going on about the difference between "we companies" vs. "they companies". I'm not going to pick up that thread right now, because there's something far more important to draw out of this discussion.

One of the blog authors, Jennifer Rice, who apparently has a deep resume in brand consulting for some big companies, and who makes some interesting observations about brand strategy, nevertheless says in an offhanded way what I've been arguing is a stake in the heart of the marketing profession. Here it is:

My definition of a brand is an idea in the minds of your customers... and that idea is formed by what you say and what you do.

Before we get to the dreaded ~semantic~ argument that so many marketers want to avoid like the plague, let's just parse the framing of this definition. It is "My definition". Not "the definition". "My definition". What, exactly is the purpose of a "definition" if its meaning can be determined individually? How do you transfer knowledge about a thing, if the meaning of the thing can be arbitrarily open to interpretation?

To be fair and honest, I can't throw any rocks at Jennifer Rice's glass house, because I'm in one myself. I'm fairly certain if you go digging through my writing, you'll find someplace where I've said "my definition of x is..." This isn't about Jennifer Rice, it's about marketers as a profession. We MUST stop treating such bedrock professional concepts as a blank page for waxing philosophical about meaning. I'm arguing that this is one of the major reasons why marketing is continuing to lose credibility--because it cannot consistently communicate an idea that is solid and immutable. And this is a profound irony. What is one of the most commonly cited attributes of a strong brand? Consistency across time and medium. Apparently we marketers don't know how build equity for our brand.

Without rehashing all of the arguments about why Rice's definition is derivitive (you can find one of the posts on this topic here) I'll summarize the argument, stolen from Heidi Schultz, this way: There is a legal definition, and legal status for the concept of a brand. You own it. You can buy it and sell it. There are laws to protect it. Not one of these commercial facts applies to the concept of "an idea in the mind of your customer". Your brand is your logo, your name, your trade dress. Everything going on in the mind of your customer is derivitive and distinct. Call it brand image. Call it brand reputation. It is not your brand.

As an oversimplified analogy, someone might say "that Ferrari is my pride and joy". Is the Ferarri *really* an emotion? Of course not. You understand that without having to parse it. A Ferrari is a tangible object. It may influence your emotions. It may make you happy and proud to drive it. But your emotions are distinct entities that are influenced by other things too.

Same with a brand. You create a brand. You cultivate brand image and reputation. There are many things that effect brand image and reputation but that do not flow directly from your brand. There are social currents, historical events, cultural attitudes, economic trends--I'm sure someone, somewhere has drawn up an exhaustive list--that also have an impact on your brand image and reputation independent of any action you take. That's why it's useful and meaningful to consider them distinctly. If you require one single word, "brand", to carry the weight of a thousand ideas, it quickly loses its ability to convey anything of value. And if marketers today are in need of anything, it's an ability to convey clear ideas with real value.

Positioning Relevance

I was driving home from a client meeting yesterday in the rain. It was one of those spring rains where it's bright outside, but everything on the road is wrapped in vapor. It's mesmerizing. You kind of recede into your head, watching the traffic, listening to the radio, but somehow away from it all. What a perfect time to listen to commercials. Really. You can meet them on their own intended wavelength, the frequency of sub-cognitive influence. You can pat the little vignettes of drama or comedy on the head and send them off to play, while welcoming the value proposition and positioning statements for a nice little chat. What is it you'd like to tell me? I'm listening.

So I'm listening to the commercials in this half-hypnotized state, and along comes a message from the accountants at Grant-Thorton. The commercial was unremarkable, it just kind of floated by, but the positioning pulled me out of my reverie. I wondered for a moment if I'd really heard what I thought I heard, but then they kindly repeated it so it left no doubt. Here it is. Remember, this is an accounting firm.

"Grant-Thorton. Passionate about the business of accounting."

Passion. Accounting. D-o-e-s  n-o-t  c-o-m-p-u-t-e. Error. Error. Format C:

I don't know why it struck me as so absurd. I mean, maybe businesses really do feel they're missing something with their dour and dispassionate bean-counters. Who needs rigor if it comes with rigor mortis? Maybe what all businesses are clamoring for is Accountants with Passion. Sing to me about my balance sheet, tell me little lies about performance, make love to the numbers you prancing pony. Yeah, that's the ticket. I can just see the chorus line.

So the whole thing got me thinking of how many times I've come across businesses that embrace the notion of differentiation-- ~Differentiate or Die~ --but have forgotten about the notion of relevance. It's good to position yourself in a way that is unique. But it's a whole lot more effective to position yourself in a way that is uniquely relevant to the goals of the consumer. Grant-Thornton may be the only accounting firm with passion. But in an era of increasing financial scrutiny, new regulations coming down the Sarbanes-Oxley pipeline, and scandal seeming to lurk around every corner, who cares about passion? Give me an accounting firm that knows what it's doing and doesn't make mistakes, and I'll find passion with my wife, thank you very much.

What A Brand Won't Do

You can have a big marketing budget, a big name spokesperson, a big event with huge publicity and emotional appeal, but if you've got a junky product, it won't improve your sales. Witness today's report of the Pontiac G6 debacle. Oprah Winfrey gave away 276 of these cars on a tear-jerking show that set the marketing world on fire. But, sales have dropped through the floor.

Art Spinella, an industry observer and marketer, summed it pretty succinctly:

Spinella said neither GM's marketing department nor Winfrey can be blamed for the market performance of the G6.

"It's one thing to have that kind of a major marketing coup, but you need to back it up," said Spinella, who said he believes that the vehicle is an underwhelming package in a competitive marketplace.

Branding Claptrap

Here is Exhibit A of the problem I'm addressing with the confused meaning of "Brand". A "marketing innovator" who posts a blog but doesn't identify himself, takes issue with my support of a tangible definition for the meaning of brand.

Christopher Kenton of Marketonomy wants to reclaim the term "brand" for the advertising realm.

I'd be curious to know on what basis that judgement is made, since nothing could be further from the truth. I want to reclaim the term "brand" for the rational realm, and distinguish it from the other derivative brand concepts that are important but *different*.

He's argument is well-thought-out but wrong. It is meaningful to distinguish between 'brand image' and 'brand experience' but in the end, a company has to live more in the derivative world of brand consequences than in the artistic world of brand impressions. Speaking as someone who's worked for many companies where the advertising was at devastating odds with the real experience of customers in the company, I think we stand to gain more as marketers by insisting that 'brand' = the total customer experience based on encounters with the company.

It's funny, because I used to argue the same thing. In fact, if you look at my theory on Touchpoint Mapping, the whole premise was that the only way to try and bring the entire breadth of the brand experience into the realm of the tangible was to understand the practical meaning of brand to be the entire array of Touchpoints a company uses to create a relationship between the company and the customer. Brand Experience is *critically* imortant to the success of any company. BUT IT IS NOT BRAND. You own your brand. You do not own your customer's experience. One is something you create. The other is something you cultivate.

It blows my mind that so many marketers refuse to accept such a basic semantic necessity as clarifying words and meanings so that we don't confuse each other by talking in circles about what a Brand is. It's a relationship. No. It's a bond. No. It's an experience. No It's an image. No. It's a promise.

What marketers stand to gain from most is Clarity.

Brand Dialog

I've had my feet held to the fire today over my column on the meaning of brand--which is as it should be. Don't ever take the word of a marketer at face value. Some of my critics took issue with the fact that I was flogging a ~semantic~ argument. Semantic apparently meaning "unworthy of consideration", rather than "a useful exploration of meanings".

But some of the criticisms were useful. One of the more interesting discussions took place via email with Justin Mink, a brand marketer from USATODAY.com. With his permission, I'm posting the dialog here. 

What is a Brand? Redux

I'm humbled. Exactly a week after pondering the slippery meaning of the word "brand", I picked up a copy of Marketing Management--a peer-reviewed journal put out by the American Marketing Association, and found Heidi Schultz's clear, concise and imminently practical definition of the brand concept. In two pages she manages to nail down the scope of the word, clear the confusion of "brand ownership" between company and consumer, and take the marketing profession to task for failing to wisely discern the true meaning of customer-centricity.

The article is well worth the cost of the magazine--but getting a copy isn't easy. The AMA site provides the archives online, but while they let you register for free (with lots of personal information), they don't tell you until after you're registered that you need to have a subscription. So, I'm going to try and find a way to get a copy to post without running afoul of the AMA.

The crux of Heidi's argument is that a brand should be understood as a fairly concrete thing--comprising names, terms, signs, symbols, designs, or combinations of these things, intended to identify the goods and services of one seller and differentiate them from another. There are clear laws that govern the intellectual property rights of a brand owner, bestowing upon the owner the right to sell and license a brand, and protecting those rights against infringement.

Heidi argues that this concrete definition of a brand should not be confused with the associations a consumer attaches to the brand based on their consumer experience. She distinguishes that concept as "brand image", including all the intangibles associated with it: what the brand promises, what it represents, how it makes consumers feel, etc. Clearly a company has an interest in influencing the brand image, but they can't control it. They can, however, control the brand--their tangible, protected property--and they are empowered by the law to do so.

Her argument takes the concept of brand out of the realm of fuzzy logic and, in so doing, exposes what she sees is a resistance on the part of marketers to submit to this level of clarity because of the accountability such clarity brings:

"Why subject brand budgets to such scrutiny when it's easier to obscure the issue and state that the brand belongs to the customer and we are simply the stewards? Isn't it just easier to say we want to measure brand success in communication terms, such as customer awareness, perceptions, and preference--not in actual financial value creation?"

I wish the rest of the Marketing Management magazine were as clear and incisive as this article. Unfortunately, a companion piece on the death of the 4 Ps seems rooted in exactly the kind of muddled marketing Ms. Schultz is arguing against. I'll be taking that on next week in Business Week.

What Exactly Is A Brand?

I've been writing in my column for Business Week about the changing nature of business valuation and its impact on the practice of marketing. In my discussions with Jonathan Knowles from Brand Finance, we got into an interesting sidetrack on the slippery meanings of "brand".

The branding meme has had a major revival over the past few years, due in part to the rise of the Internet and the entirely new medium in which brands can be built. There have been endless pontifications on the importance of brands, the meaning of brands, the value of brands. Some of it is enlightening; too much of it is snake oil. Everyone needs a brand. Everyone is a brand. Brand... Is.

The whole dialog is as close as marketers come to a philosophy about their work--the meaning of marketing as an endeavor--and I think they get a little light headed. Yes, marketing has a fascinating psycho-social component, but in the end, marketers are paid to create value. What they forget is that value in business has a bottom-line metric--ie: I'm glad you find your work culturally significant, but what are you doing for my cashflow?

What I appreciate about Knowles is that he is both insightful and grounded in pragmatics. Knowles asserts that the goal of a brand is to create more successful businesses. Somehow I think that point is too often missed in actual practice. Specfically, he says, the creation of customer value is what gives brands the opportunity to create financial value--or what marketers call the price premium that well-branded products can command. But what does that tell us about what the word "brand" really means?

Historically, marketers have often defined brand as a promise of quality--something created by a company and handed over to the customer. Advertisers came along and tweaked that idea, calling brand a set of associations in the mind of the consumer--something owned by the consumer and shaped through manipulation. When the Internet took off, we started hearing about brand as an experience, something more than just a promise or a set of associations, something more alive. But when you push on any one of these concepts they get a little squishy.

Okay, brand is a promise, an association, an experience, a reputation even. But how do you invest a million dollars in a promise? How do you measure the equity of an experience? The truth is, you're investing in something that implies a promise, or builds a reputation, and all of those things--whether you're talking about customer service, or equipment, or intellectual property--those things have their own names; you wouldn't call them brands. And, as Knowles is showing in his work on brand valuation, you don't directly measure a brand as much as you measure the effects of a brand--how much you invest in activities that build brand, for example, or how much of a premium people are willing to pay. The actual thing itself, brand, is still slipping out of our grasp.

If you start with the earliest meanings of the concept, its advent is the notion of ownership. "I own this." But even here there are some interesting shadings. Why be so interested in asserting ownership? It could be a statement of territory, "this is mine", or of creation; "I made this", or even of responsibility "I am accountable for this". In the simplest terms, when you go back to cowboys burning a mark on their cattle, it's really a clerical purpose. When the big cattle drives inevitibly mixed together, you had to be able to tell which animals were yours.

The point is that the brand is not the creator, and it is not the created. It's a tangible symbol of the relationship between the creator and the created. Okay, that's easy enough, if a little pedantic. What's interesting to me is how the meaning evolves once you move away from the utility of the concept to the ripples of effect that mark any transaction between a creator and a consumer by way of an object. Now it is the experience of the consumer that adds a new layer of meaning to the concept of brand. In a sense, the product is now a proxy for the relationship between the creator and the consumer--"this product is the distillation of my value to you"--and the brand is... What?

Well, the product isn't the brand, the creator isn't the brand, and the brand is no longer just a tangible symbol of the relationship between the creator and the created, it's now a "container" for the experience of the consumer. And this is pretty much where I sit at this point. This is a really clunky way to say it, and I need to work on this, but to me, a brand is a conceptual container that emanates, planned or not, from the creation of something of value that is transferred from its creator to a consumer. The container is shaped by the creator, but the contents of the container are created by the consumer. And at the end of the day, the value of the container is a function of both its shape--it's ability to invite, suggest, contain and label the experience of the consumer, especially as unique from other experiences--and its contents, which is the experiences and associations consumers actually accrue to the container. The container must be created in a way to maximize its potential contents, as well as the ability to transfer contents from one consumer to other--ie: providing a container that's already partially filled.

Is this a penetrating glimpse into the mundane, or does it have any incisive value? You tell me. I'll say one thing, I wish I could take this grammar school class today. It might resolve a lot of my questions.