Sunday, December 26, 2010

Does Your Brand Deliver On Its Positioning Strategy Every Day . . . Or Are You Just Faking It?

Many marketers are asking the question “is brand positioning still relevant in the 21st century”? I've written on this topic before, and the majority of comments, both public and private, agree with me that positioning is still an important and viable tool in marketing. At the same time, almost all acknowledge that effective branding is much more difficult in a world where an angry tweet, critical blog post, or catchy YouTube video can cause serious damage to your brand image.

United Airlines discovered this during 2010 when their “friendly skies” were revealed as not so friendly by the YouTube video “United Breaks Guitars”, which has over eight million views (and counting). So did Maytag, Nestle, and others who saw angry, empowered consumers calling them out as branding frauds based on their actions.

But what caused that damage? Is it simply the availability of technology that allows a disgruntled customer to broadcast their dissatisfaction to large numbers of people? Or is it nothing more than poor brand management?

A brand that has been under fire this past year for major branding missteps is Toyota. Toyota shook up the automotive world with a quality message that Detroit either ignored or could not match. And for 30+ years they have enjoyed the benefits of that brand position. But all of that customer brand loyalty is now threatened because somewhere, along the way, Toyota managers failed to understand that a brand built on product quality must live that strategy every day to be successful.

One of the biggest mistakes that marketers make is not realizing that branding happens in every interaction and point of contact between a company and its target customer. They work hard on their advertising and other external communications, but don’t understand that brand communication is much more than just what the brand manager and ad agency say about it.

It’s how your staff answers the phone, how easy the web site is to navigate, what message the packaging sends, the tone of the copy writing, and even, in the case of a retailer, how the store looks and where it is located. It’s the sum total of any and every experience people have with the company.

Consistency is a critical element of an effective branding strategy, and one brand that I have always admired for its belief in the power of delivering on expectations every day is McDonald’s. Every owner and manager must attend Hamburger University in Chicago, where they not only learn the operational aspects of running a franchise; they also study the importance of providing a consistent experience for the customer. Few customers would say that McDonald’s makes the best hamburgers, but the company continues to dominate the fast food marketplace in part because the customer knows what to expect. No matter where they are in the world.

This devotion to consistency was most apparent when McDonald’s entered Russia. McDonald’s execs felt that native Russian potatoes did not deliver the same crispness and flavor that McDonald’s is famous for serving. So they delayed their introduction into Russia for two years, imported their own seed potatoes, and waited until they got it right before opening the first restaurant. That is a great story and a great testament to the power and need for consistently delivering on every aspect of the brand promise.

Branding is a tough job. And it’s certainly not getting any easier when even the slightest misstep by anyone in the organization can have a snowball effect. But some brands get it right, by building on a platform that is truly representative of the core values of the company, solves a relevant need, and is consistent over time.

Tuesday, December 7, 2010

Has the Internet changed more than just how we buy, but also how we decide what to buy?

McKinsey research on the Internet and its effect on our buying habits says "yes". The explosion of products, media alternatives and access to word-of-mouth experiences through social media and other Web 2.0 access points has created a radically new buying decision process.

The McKinsey study concludes that consumers no longer proceed in a linear "purchasing funnel" process when deciding to make a purchase. The funnel analogy has been a basic guideline for marketing thinking and planning for many years -- consumers start with a number of potential brands in mind (the wide end of the funnel) and then systematically move through linear stages of familiarity, consideration and purchase by narrowing the choices along the way to get to the one brand they ultimately purchase. It sounds logical, and has been until now.

Marketers and their agencies must acknowledge this new "consumer decision journey", as McKinsey describes it, and revise the focus of their marketing to be in the right place at the right time to reach consumers when their message is most likely to influence their purchases.

The first step in the buying decision is the same. The consumer considers an initial set of brands based on brand perceptions and exposure to recent touch points. It should be noted, however, that other research has confirmed that the initial consideration set is typically much larger than it might have been in previous buying decision based on the greater number of products and a decline in brand loyalty from a preferred brand to a preferred set of brands.

It's the second step in the buying decision that has been most affected by the web. Rather than narrowing the choices, the consumer enters an active evaluation phase where the number of choices may be dramatically expanded. Internet access to information from a variety of social media and other word-of-mouth touch points can have a dramatic effect on the brands that were initially considered, and those original choices can be easily replaced with more informed choices based on trusted input and evaluation.

This active evaluation phase shows a profound change in consumer response and requires much more consideration by marketers if they want to be successful. The traditional "push" marketing elements, that most likely affected the initial consideration set, can be easily modified by an empowered consumer who now takes control of the decision process. Today's empowered consumer actively seeks corroboration of previous brand impressions and new input from Internet reviews and other information sites as well as word-of-mouth recommendations from friends and family and other trusted sources. The McKinsey report concludes that traditional marketing remains important, but argues that marketers must move aggressively to learn to also find ways to influence these consumer-driven touch points in order to remain in the consideration set.

Ultimately, the consumer selects a brand to close the purchase, but the McKinsey study shows that even this stage has seen changes. Their study places much greater closure importance on the impact of the in-store (or on-line store) experience as well as recollections of past experiences. They conclude that many purchases become a last minute decision.

Another important finding from this study is that the post-purchase experience has changed dramatically as well. Many consumers go online to conduct further research after the purchase, a stage never considered in the original funnel model. This post-purchase research can either confirm the wisdom of their decision, or have a significant impact on future purchases by exposing the consumer to new, previously unknown, alternatives.

This new knowledge on the "consumer decision journey" requires that all marketers re-evaluate their marketing programs to ensure that they are influencing and impacting consumers at every stage of the process. It certainly tells us that we must do everything we can to develop touch points during the consumer-driven stage of the decision process. For many marketers, this will require a mind-set shift from a reliance on buying media to a more balanced program that supports developing assets such as interactive web sites, mobile marketing, social media properties, and rich media applications that provide a way for consumer to learn more about their products and services.

This also presents a new challenge, and a new opportunity, for agencies to help their clients navigate these new alternatives to find the best solution for their brand. As I have said in previous posts, clients are not just looking for an agency to develop an ad or design a web site, they are looking for someone to help them build a bridge between the brand and their customer. Helping them understand how their customer reaches the ultimate purchase decision is an crucial ingredient in finding that bridge.

As marketers, we know that the Internet has dramatically affected the buying process for many products as online purchasing continues to grow at a dramatic pace. Preliminary results from this year's Black Friday and Cyber Monday online sales confirm this as fact, But we should also understand that the Internet has had a major influence on the buying decision process as well.

The complete McKinsey study can be accessed by following this link: