Thursday, April 28, 2016

Brands and Customer Segmentation

Marketers segment their markets so that they can better target the customer groups that offer the greatest sales potential. This also helps them refine brand messages for each group. Markets can be segmented on product usage, purchase behavior, benefits, price, life stage, cohort group, psychographics, geographics or geodemographics. In many product categories, there are price sensitive, convenience driven, brand loyal and category enthusiast groups. 

One way to segment markets is based on specific attitudes, values, beliefs, lifestyles and self-perceptions. The market researcher uses qualitative research to uncover hypothesized attitudes, values, beliefs, lifestyles and self-perceptions associated with heavy or loyal brand or product usage. These attitudes, values, beliefs, lifestyles and self-perceptions are translated into statements that can be tested against product/brand usage in a quantitative brand segmentation study. Once these statements are validated, they can be used in all subsequent research.

We have worked with many clients to help them determine their most lucrative segments based on attitude, value, belief, lifestyle or self-perception statements. Here are some of the statements that we have found identify different customer segments:

  • I am a fun mom
  • A good education is critical to my child's success
  • One person can make a difference in the world
  • I love to entertain in my outdoor space
  • The world is changing so fast that it is hard to keep up
  • Our country needs a strong leader who can take control of things
  • Climate change is one of the world's most pressing problems
  • I don't worry too much about anything
  • I am always one of the most stylish people in the room
  • Ending the cycle of poverty starts with children
  • A good Christian always seeks to help those who are less fortunate
  • It's ok to indulge once in awhile
  • I love to drive
  • I love to shop

I wish you great success in finding and appealing to your most promising customers. 

For more information on market segmentation, refer to the "Understanding the Consumer" chapter in Brand Aid, second edition.

Monday, April 25, 2016

Vacuous Brand Claims

Every so often, I run into marketers who are more interested in coming up with catchy slogans than creating real brand promises. They want something that sounds good. Sometimes they even want something that seems versatile, that is, that could help make any point or say anything. But they are not focusing on the one thing that can make the brand stand apart, its relevant differentiated benefits or shared values and they cannot support their slogan with proof points or "reasons to believe."

Brands need to pick promises and slogans that cannot also work for many other brands in their categories. The promises and slogans need to apply uniquely to them.

The brand positioning exercise is all about claiming something that is unique, compelling, purchase motivating and believable for the brand in question. It is not just about coming up with something that sounds good. 

Here are some examples of pretty lame brand slogans or tag lines that were created without doing the tough brand positioning work first:

  • [brand]: It's got it!
  • [brand]: The place to be
  • [brand]: Tomorrow starts here
  • [brand]: Get into it
  • [brand]: Together for a better tomorrow
  • [brand]: Leading the way
  • [brand]: Making good things happen
  • [brand]: Innovating the future

Admittedly, short catchy tag lines can work if they support unique and compelling brand positions. For instance:
  • Nike: Just do it
  • Subway: Eat fresh
  • Verizon: Better matters
  • Coke: It's the real thing
  • Apple: Think Different
Each of these was created to support a very specific brand position. 

When positioning or repositioning your brand, come up with something that is a powerful differentiator that can't be used by competitive brands. Also pick something that has a very clear meaning and can't be used to make almost any point. Brands need to stand for one thing (or two things at the most). If you are trying to make too many different points about your brand, people will not be able to recall any of the points. If you think the tag lines in the first list are good, I would recommend that you read my book, Brand Aid, second edition. You might change your mind after reading it.

Tuesday, April 19, 2016

Exploratory Brand Research

It is useful to perform exploratory brand research for relatively new brands whose markets are not yet fully understood. It can also be useful to perform this type of research for brands that need to be repositioned. Further, this type of research can inform brand and line extension decisions.

In exploratory brand research, one is trying to understand how the brand is perceived, purchased and used. Further, one is trying to understand the brand's competitive frame of reference and potential substitute products. 

This research is qualitative and is almost always conducted in focus groups or mini-groups. Here are the areas that I explore in this type of research:

  • What do you think is in this package?
  • How do you think the product works?
  • Who buys a product like this?
  • What would cause them to buy this product?
  • Where do you think they are most likely to find a product like this?
  • Where would they never find a product like this?
  • Where in the store would it be located? Next to what other products? Why?
  • How much do you think they would have to pay for a product like this?
  • How often do you think they might buy this product?
  • How would they use this product?
  • How do you think using this product might make them feel?
  • If this product were not available, what do you think they would purchase instead?
  • Are there other similar brands? What are they?
  • What do you think this brand stands for?
  • What other types of products might be offered under this brand name? Why?
  • What types of products would never be offered under this brand name? Why not?
  • Do you think this is a good quality product/brand? Why or why not?
  • Do you think this brand delivers a good value for the price paid?
  • How might you change this brand to make it more appealing?
  • What do you think the name means?
  • Why did they pick those colors?
  • Why did they package the product the way they did? 
  • Is there a better way to package it?

One can use dozens of other similar questions. The point is to understand how the product and brand are perceived by its customers and potential customers. One can use a variety of stimulus to explore brand extensions, substitute products, alternative product category definitions, alternative branding approaches, other names, competitive contexts, different uses, varying distribution approaches, etc. One is seeking to understand what resonates with customers, what is puzzling or confusing to customers and what creates cognitive dissonance for those customers. All of this helps in positioning the brand properly and understanding the extent to which the brand can be expanded in its meaning and across different product categories. 

For more information on brand research, read Brand Aid, second edition.

Sunday, April 17, 2016

Testing Outside of Boundaries

We conduct a lot of brand research on behalf of our clients - a mix of qualitative and quantitative. We usually try to "push the envelope" in what we explore to make sure we have not missed a brand positioning opportunity, a brand extension opportunity or any other opportunity.

Often, clients are not comfortable with this approach. We get responses such as, "We would never do that." or "Why would you test that? That is not 'on brand.'" Others ask why we are testing negative personality attributes. Some say, "Don't test that. That position is already taken by one of our competitors." Sometimes we hear, "I don't know why that is relevant." or "Why don't you focus on something more tangible." Some brand managers are much more comfortable testing functions and features than emotional, experiential and self-expressive states.

Frankly, a lot of brand managers are solidly "in the box." They will never create a breakthrough brand position or a new product concept if they are not willing to test outside of what they already know the brand's (or product's) boundaries to be. One needs to test outside of boundaries to understand if those are the true boundaries or if the boundaries can be stretched. As it has been said, "To push the boundaries, you need to know where the edges are." And to create "category of one" brands, it is mandatory that one tests outside of the current category definition.

While I agree that one should not waste time or money testing things that are irrelevant and tangential to the brand's success, sometimes it is just those things that seem tangential that result in the true breakthroughs. So, before you reign your brand consultant or brand researcher in, consider that he or she may just be on to something by testing outside of your comfort zone. 

Tuesday, April 12, 2016

Brands, Change & Innovation

The rate of change in our society continues to accelerate. This causes many people quite a bit of anxiety. Emerging technologies have replaced millions of jobs but, so far, they have created more jobs than they have eliminated

Consider what digital photography (invented by a Kodak scientist) did to Eastman Kodak company. Consider what Uber is doing to traditional dispatcher-led taxi cab companies. Consider how is impacting the growth rate of hotel chains. What did laptop computers do to desktop computers? How are pad computers and smartphones impacting laptop computer sales? Consider how Hallmark and American Greetings are impacted by digital technology. Consider what CreateSpace and other self-publishing platforms have done to traditional book publishers. What will artificially intelligent medical diagnosis systems do to medical internists? With self-driving automobiles, how will the auto insurance business change? What will Tesla and its battery-driven vehicle revolution do to the oil industry (and the auto industry and gas stations)? Where will drones ultimately take us? What will increasing aerial surveillance do to our ability to capture criminals and prevent wars? Consider that AI experts are exploring how to give computers the capacity to innovate. And this is just the tip of the iceberg.

Consider how Einsteinian physics superseded Newtonian physics and consider how quantum physics recast Einsetinian physics and consider the potential impact of superstring theory and multiverse theory. 

Research universities and company R&D labs are working on these disruptive technologies - energy storage, fuel cells, genomics, advanced materials, autonomous vehicles, renewable energy, advanced robotics, 3D printing, mobile Internet, automation of knowledge work, cloud technology, integrated digital design and photonics.

We were recently approached by a company that is on the verge of commercializing human organ regeneration. And consider the LED revolution. Incandescent and florescent lightbulbs may soon become historical artifacts. And several companies are working on developing direct computer-brain interfaces.

In a rapidly changing world, no business is safe from technology-driven obsolescence. So, what is a brand manager to do? For that matter, what is any business manager to do? Here is what will matter for future survival, and more importantly, to thrive well into the future - higher education, advanced degrees, lifelong learning, a solid understanding of math and science, diverse interests, diverse reading, personal flexibility, ideation skills, courage in the face of uncertainty, the ability to change course at a moment's notice, understanding the intersection of many different scientific disciplines and technologies, an opportunistic attitude, entrepreneurship, the ability to take risks, a penchant for action, an optimistic attitude and the ability to discern patterns and recognize meta-themes.

Influencing is a Critical Brand Management Skill

“It is amazing what you can accomplish if you do not care who gets the credit.” Harry S. Truman, 33rd President of the United States of America

Brand management is an enterprise-wide endeavor. But most brand managers do not have enterprise-wide authority, even if they are highly placed in the organization. This is why influencing skills are critical to the success of that role. I always took Harry S. Truman's quote seriously. I figured out who I needed to influence and what I needed them to know, believe or conceive and then carefully "seeded the field" with those ideas. I would casually mention these things in the hallway, over lunch, at a dinner party or at a ball game. I was most successful if each person thought the idea was his or her own, not mine. Then I would watch what I wanted to occur unfold naturally throughout the organization with all of the right people championing the things that needed to happen on behalf of the brand.

You can be so brilliant at subtly influencing others that people may begin to think that they don't need you because the right things seem to be falling in place and getting done without your driving force. However, as long as you let your boss know what you are up to, completely support these brand-positive efforts and compliment your peers on "their" brilliant ideas, things will go smoothly for you. Plus, if you are influencing people on the right things, you should achieve or exceed your objectives. 

People don't like to be told what to do, especially by someone outside their chain of command or at a lower level in the organization. This is why it is critical to get them to believe that what you want them to do was their own idea. 

I was a master at this and it helped me immensely in my stint as Hallmark's chief brand advocate. You too may find that influencing others is a skill that helps you in your role as a brand manager.

Friday, April 8, 2016

Marketing and the Deep Understanding of Human Behavior

The best marketers understand why people behave in the ways that they do. They understand people's underlying phobias, fears and anxieties. They understand their hopes and aspirations. And they understand their attitudes, convictions and values.

The best marketers constantly observe human behavior but also strive to understand the motivations that underpin that behavior. The best marketers have some of the skills of anthropologists, psychologists and sociologists and they are constantly conducting informal ethnographic research.  

Do you know what it is like to live and work in a big city such as New York? Do you know what it is like to live and work on a dairy farm? How about a ranch? Do you know what small town life is like? What is it like to be a poor unemployed African American in a dangerous urban neighborhood? What is it like to be a CEO? Or an oil rig worker? Or a soldier who has seen the worst of war? Or the son of a high profile politician? 

What's it like to live in Burlington, Vermont or Corpus Christi, Texas or Boulder, Colorado or Akron, Ohio? What is it like to live in Tokyo or Zurich or Almaty, Kazakhstan? 

What is it like to live in Cuba today? What is it like to live in Syria today? What is it like to live in Papua, New Guinea today?

What is it like to not have a car and only use pubic transportation in a big city? What is it like to not have a car and to walk or ride your bicycle everywhere?

What is it like to never get any exercise other than pushing the buttons on a remote control? What is it like to work out two hours a day and have a perfectly sculpted body?

What is to like to live in the jungle? What is it like to live in the desert? What is it like to live on a remote island?

What is a mother who just lost her teenage son in a tragic traffic accident feeling? Or a father who's daughter just won a gold medal in the winter Olympics? What is going on in a Tea Partier's head? How come some people are so liberal? What does it feel like to be a 45 year-old laid off factory worker who has not worked for five years?

If you are pro-life, do you really understand what motivates pro-choice people? If you are pro-choice, do you really understand what motivates pro-life people? If you are a strong gun control advocate, do you understand why some people will fight to the end to preserve their right to bear arms? If you are a gun advocate, can you put yourself in the shoes of a staunch gun control advocate?

What is it like to have grown up Mormon? What is it like to have grown up as an Evangelical Christian? What is it like to have grown up in a nudist colony? 

What is it like to have grown up with an abusive father? What scars remain from having been raped as a teenage girl? What is it like to have had a near death experience? What is it like to have experienced altered consciousness as the result of a drug induced trip? Why do some people have strange compulsions?

Why are some men afraid of strong women? Why are some people so self-centered? What is it like to have grown up in an orphanage? What is it like to be a refugee? What would life be like if you knew that you had a disease from which you could die at any moment? What is it like to be HIV+? 

How does it make you feel that your spouse makes five times as much income as you do? How do you feel about graduating in the bottom 10% of your class? What's it like to win $100 million in a lottery? What if your brother is a doctor, your sister is a lawyer and you are an unemployed contractor?

These scenarios are just the tip of the iceberg. My point is that marketers should constantly consider how others are feeling, what their insecurities are, what pressures they have to bear, what forms their attitudes, what their beliefs are and what fears drive their behaviors. Because marketers need to know what motivates people. And the only way to do that is to understand people, not just at a superficial level, but deep down. 

And it would help to understand different societies and cultures and even to understand different psychological disorders such as social anxiety disorder, post-traumatic stress disorder, obsessive compulsive disorder, bipolar disorder, depression, narcissistic personality disorder and hypomania. 

It is even instructive to know the different motivators for people's religious fervor. A good book to stimulate your thinking on this is The Varieties of Religious Experience by William James. Further, it would be very helpful to understand what it is like to be a working poor person, a blue collar worker, an upper middle-class professional and the member of an elite uber-rich family. 

Again, marketers must strive to really understand human motivations at a deep level. I wish you great success in developing your anthropology, psychology and sociology skills. 

Wednesday, April 6, 2016

Relationships Between Brands

Whenever there is a family of brands, as a brand manager, you must make clear what the relationships between those brands are. The relationship can be parent brand/sub-brand or smaller brand endorsed by the parent brand or stand alone brands (unrelated in any way), including the high level brand being a non-consumer facing holding company brand. So, you can choose everything from a branded house (Toyota or Sony) to a house of brands (P&G or Unilever). But choose you must. And it must be a conscious choice. 

I have seen too many instances in which the brand manager does not think through the relationship between the brands and then slaps two or more logos on a product or its packaging. This makes it very confusing for the consumer, especially if the different logos are in different places on the product or packaging. It puts the responsibility on the consumer to figure out what the relationship, if any, is between the multiple brands featured on the product or its packaging. 

Is one brand endorsing another brand? Is one brand brought to you by another brand? Is one of the brands an ingredient brand? Are the different brands co-promoting the product? Do the multiple brands indicate a strategic partnership? Is one brand a parent brand? If so, which one? What is the relationship between the brands?

Not only does it help to lock names in a certain relationship in identity systems, but also to indicate the relationship between the brands using words (especially for endorsed brands). Here are some of the ways I have seen one brand endorse another brand using words:

  • A [brand X] aircraft company
  • A division of [brand X]
  • A [brand X] partner
  • A [brand X] retirement community
  • A [brand X] subsidiary
  • A [brand X] retreat center
  • A [brand X] service center
  • Featuring [brand X] technology
  • With [brand X] inside
  • Brought to you by [brand X] bakeries
  • By [brand X]

The relationship you create between the brands must be intentional and it must work for both brands. The simpler and more clear you can make the relationship, the easier you have made it for the consumer to understand what he or she is buying. Ideally, each brand's marketplace awareness and positive associations strengthens the perceptions of the linked brand. There must be strategic intent behind the chosen linkage. 

Neglecting to create this intentional linkage demonstrates ignorance, laziness or sloppiness. 

Monday, April 4, 2016

Best US Business Schools for Marketing

According to Bloomberg, the best undergraduate business schools for marketing (based on student input) are:
  1. William & Mary (Mason)
  2. Washington University (Olin)
  3. Virginia (McIntire)
  4. Pennsylvania (Wharton)
  5. Loyola - Maryland (Sellinger)
  6. Cornell (Dyson)
  7. Florida International (Landon)
  8. Arkansas (Walton)
  9. Elon (Love)
  10. Michigan (Ross)
US News & World Report provides the following ranking for undergraduate marketing programs:
  1. University of Pennsylvania
  2. University of Michigan - Ann Arbor
  3. New York University
  4. University of California - Berkeley
  5. University of Texas - Austin
  6. University of North Carolina - Chapel Hill
  7. Indiana University - Bloomington
  8. University of Virginia
  9. University of Wisconsin - Madison
  10. Saint Joseph's University
  11. University of Southern California
  12. University of Minnesota - Twin Cities
USA Today ranks the schools as follows (based on College Factual’s ranking methodology for overall academic quality):
  1. Bentley University
  2. University of Pennsylvania
  3. Bryant University
  4. Southern Methodist University
  5. Emerson College
  6. Lehigh University
  7. Georgetown University
  8. Syracuse University
  9. Washington University in Saint Louis
  10. Villanova University
Business Insider lists the following colleges and universities (undergrad and grad) based on marketing employment (from a LinkedIn analysis): 
  1. University of Pennsylvania
  2. University of Michigan
  3. Harvard University
  4. New York University
  5. Cornell University
  6. Georgetown University
  7. Stanford University
  8. University of California - Berkeley
  9. Northwestern University
  10. University of Texas - Austin
  11. University of Phoenix
  12. University of North Carolina at Chapel Hill
US News & World report ranks marketing MBA programs as follows:
  1. Northwestern University (Kellogg)
  2. University of Pennsylvania (Wharton)
  3. Harvard University
  4. Stanford University
  5. Columbia University
  6. Duke University (Fuqua)
  7. University of Michigan - Ann Arbor (Ross)
  8. University of Chicago (Booth)
  9. University of California - Berkeley
  10. New York University (Stern)
Smart Class ranks marketing MBA programs as follows:
  1. University of Chicago (Booth)
  2. University of California  Berkeley (Haas)
  3. Northwestern University (Kellogg)
  4. Duke University (Fuqua)
  5. University of Virginia (Darden)
  6. New York University (Stern)
  7. Cornell University (Johnson)
  8. Carnegie Mellon University (Tepper)
  9. University of Texas - Austin (McCombs)
  10. Emory University (Goizueta)
  11. Indiana University - Bloomington (Kelley)
  12. Rice University (Jones) ranks graduate school marketing programs as follows:
  1. Northwestern University
  2. University of Pennsylvania
  3. Stanford University
Poets & Quants lists the following as the best MBA programs in marketing:
  1. Northwestern (Kellogg)
  2. Pennsylvania (Wharton)
  3. Stanford
  4. Harvard
  5. Chicago (Booth)
  6. Michigan (Ross)
  7. Duke (Fuqua)
  8. Columbia
  9. New York (Stern)
  10. Texas (McCombs)
Factoring in all of the different rankings, University of Pennsylvania, University of Michigan and Cornell University deliver the best undergraduate marketing programs, while Northwestern University, University of Pennsylvania, Stanford University and Harvard University deliver the best graduate programs in marketing.