brand.extension

How to Lose Customers and Alienate People

Customers can be annoying. Every marketer knows that. Wouldn't companies be better off, if they didn't have to deal with them anymore?

This is a 5 step guide to losing your customers and making sure they won't come back:

Step 1: Screw up!

This one is a no brainer. Nothing gets the attention of your customers like doing something really annoying. So this should be your first step. For example, if you are- a pizza delivery service, show up 90 minutes late. Or do, what Joey's Pizza (a big pizza franchise in Germany) did with my brother's order the other day: Burn the pizza until it's inedible. There are plenty of ways to annoy your customers, so I'm sure you will find one that works for your company.

Step 2: Don't apologize!

Apologies are for losers. You are not a loser, so don't apologize for screwing up. Instead, make up excuses you cannot be blamed for by angry customers. Obviously it wasn't your fault. Be creative and you will find a scapegoat you can blame. If you are a true master, your angry customers will eventually start believing what went wrong was their own fault.

Step 3: Tell your customers they are wrong!

This is an effective alternative to step 2. Sometimes consumers get a little off track and accuse you or your company, but you are (or feel) totally innocent. In this case you shouldn't hesitate to tell them just how wrong they are! Here's another example you can learn from: When my brother complained to Joey's about the burnt pizza, the delivery guy told him the pizza wasn't burnt and he should eat it. Just the kind of extra advice customers appreciate.

Step 4: No refunds!

Some persistent customers might not accept that they are wrong and ask for their money back. In this case you should stay strong and say no! They should have thought about that before they did business with you. You don't have anything to give away for free, especially in these tough economic times. Consistency is very important here: If you give one customer a refund, everybody will ask for one. It's not your fault they aren't satisfied! That's why Joey's delivery guy didn't give my brother a refund. After all, he had already told him his pizza wasn't burnt. So, there!

Step 5: Make sure people spread the word!

If you follow steps 1 through 4 thoroughly, you should be on the right track to losing most of your customers. Keep in mind that this is not enough! You also want to make sure your annoyed (ex-)customers tell this story to as many other people as possible. That's why you should add a little cherry on top to make their experience with your brand unforgettable. You can really use the power of word-of-mouth here, since annoyed customers tend to tell more people about it than happy customers. The internet will help them spread the word.

One way to achieve this, is by doing what Joey's delivery guy did after my brother called his supervisor and eventually did get the refund: Refuse to pay back the tip! After all, he had to come back to my brother's house for a second time because of my brother's complaint. It was hard-earned mone, why should he let my brother take it away from him?

There are infinite paths to losing customers, but this guide will help you focusing on the key factors: condescension and a lack of common decency.

But wait, you might say, how do you make money, if you don't have any customers?

Well, that's what bail-out money is for...

Is Learning From the Best the Best Way to Learn?

When it comes to learning, we usually seek to get insight from the best people we know. It is a very natural thing. Even little children try to imitate their parents because they see them as role models. Trying to be as the people we look up to seems to be reasonable. Or is it?

The problem with learning from the best is the assumption that people who ARE the best also KNOW IT best. But do successful people really know the reason for their success? Most of them probably think they do. They follow a certain strategy and they achieve the results they intend to, so they link these results to their strategy. In reality our life of uncertainty is a lot more complex, but people like to be in control of their own destiny, so they ignore the fact that there are factors they can't change. Another person who follows the same strategy might get a completely different result.

This is true for brands as well. The success of one brand is simply not repeatable. There is always a combination of things that lead to success. One of the most important factors is being in the right place at the right time. And in most cases, that's not the result of strategic planning, but simply chance, or luck, or destiny, or however you will call it.

It turns out you can learn just as much from the not so successful examples. If you look back at your life, would you say you learned more from the things you did right or the things that went wrong? I bet it's the latter.

People learn from mistakes because failure forces them to think and figure out why something went wrong. As long as everything is fine, there is no reason to overthink your actions. Just look at the financial crisis: Bankers just kept on doing what they were doing because it used to be their way to success. When things went bad, only few of them saw it coming. Not because there were no warning signs, but because they believed they couldn't fail.

I'm not saying you can't learn from successful brands or people. But taking only the best as an example can be frustrating for two reasons:

1. You will find that many of the things that worked for them don't work for you. Just because something works for one brand/person it doesn't mean it works for everyone else.
2. You will always be second - at most. If you do whatever the leader in your specific field does, you can never be as good. You will always be a copy. Like a generic drug: Works as well as the original, but will never be seen as equal or better.

Just look at it from this perspective: Many brands know what makes their competitors more successful. If it would be so easy to copy, wouldn't there be a lot more successful brands?

Here is the reason why it doesn't work that way:

 Every person and every brand has an identity. This identity makes them unique and special. Only if you know your identity as a brand/person you can really learn from others because only then you can adopt the things that work for you and neglect the ones that don't.

If there is one thing that most successful brands have in common, it's that they all walked on new paths and found their own unique way of doing things. They became so successful because they did NOT just follow the example others set for them. Perhaps this is the most important lesson to learn.

(Second picture by Permbroke Dave)

Long Way From Denial to Acceptance

This morning I heard a radio ad that really stuck with me - but not in a good way. Recently it has become quite obvious to me that radio advertisments are usually not very well made. Their relevance seems to have diminished so much over the years that companies don't pay much attention to the messages they send, if they only find a way to yell them loud enough to be heard in the multitude of voices consumers try to ignore. What happens afterwards doesn't really matter. Hopefully, consumers will go through a process called AIDA: Once you've got their attention there will be interest, desire and finally action. Never mind this is an old sales concept.

While TV commercials use images and hence attract the most powerful human sense, radio ads lack visual support of the intended message. But does that mean the best thing to do in a radio ad, is to use as many words as possible in 20 seconds to talk about your product? To me it seems like it would be more efficient to just play the jingle and have someone say your slogan than spending money on producing those kinds of radio spots. Of course, there are a few really good, interesting and funny radio ads, but they are the exceptions that prove the rule. What amazes me even more is the total lack of a clear message in most of them. An ad is supposed to support the brand message, not to confuse consumers by contradicting it.

As you can probably tell by now, my opinion on radio ads is not very high, so how did the ad this morning make an even worse impression on me?

It was an ad for the American car brand Chevrolet: "Ganz Deutschland feiert den neuen Chevrolet." Translates to: "Everybody in Germany is celebrating the new Chevrolet." Quite a statement for a niche brand, which Chevrolet is in the German car market! I know it's easy to pick on American auto manufacturers these days, but this lack of self-awareness is really incredible.

I'll try to say it as unmistakably as possible: For many Germans the term American car is an oxymoron! This may not be a very rational opionion and it may also not be Chevrolets fault. In fact, it doesn't even matter how good this new car may be or how good the value of their offer is. What matters is how consumers perceive them. Chevrolet will have to deal with this poor image, if they like it or not. It looks like it will take them a while to accept that. Right now they are apparently in the stage of denial. Sure, you want to say something positive about your brand, but it should be anywhere close to reality. It is absurd to claim that everybody in Germany is celebrating the new Chevy.

Perhaps General Motors should have asked the Japanese auto makers. It took them decades to overcome their notoriously bad image in Germany. Toyota's slogan at that time was a lot more appropriate: "Nichts ist unmöglich" - nothing is impossible.

The Anti-Shoe

The other week, my girlfriend bought expensive new shoes. That might not sound like it is anything worth mentioning at all - if you don't know my girlfriend. It's a stereotype that women spend lots of money on shoes, but she is usually not like that. Neither does she own 70 pairs of shoes, nor did she ever spend that much money on one single pair. That made me think: What made my girlfriend break her habit of not caring about shoes?

In marketing we talk a lot about involvement. If something, a product or a category, is very important to you, we call that high product involvement. That means you spend a lot of time thinking about this type of product and gather information before you make a buying decision. With a high involvement product you are more likely to make a rational choice than with low involvement products. Low involvement products are products you buy, but don't really care about, e.g. toothpaste or toilet paper.

Of course, whether your involvement is high or low depends on your personal preferences. Some people might spend hours finding out the pros and cons of every toothpaste available on the market to purchase the best possible product for their teeth. The majority however, will just buy the same toothpaste brand they always buy, without even thinking about it. There are more important things for them to think about.

But sometimes new products are introduced to the market that change the involvement of a group of people. People, who never spent time thinking about toilet paper, find out they should buy Charmin because they deserve better than that scratchy regular toilet paper (Charmin was introduced to the German market in 1999). Or people, who used to base their decision of which MP3 player they'd buy on storage capacity, suddenly want an iPod and no other brand, no matter how high the capacity may be.

It is the goal of every marketer to make their product and brand stand out, but it doesn't happen very often that consumers change their involvement. So, how does it work?

Did iPod buyers really care more about MP3 players than they used to? Unlikely. What happened is that people saw the iPod as a category of its own that replaced their need for MP3 players. The position of the iPod in people's minds is different from all the other MP3 players. That is the goal of positioning: To distance oneself from the competition in a way that makes you look better in the eyes of your target group.

If you sell shoes and your target group are people who don't care about shoes, what do you do? MBT knew the answer: They made the anti-shoe! It's a strategy that worked for 7Up, which has been positioned successfully as the "Uncola". Apparently, that was enough to get my girlfriend's attention, make her research all the benefits of those anti-shoes, try them on, order them from an online shop and obsess about possibly missing the delivery truck for three days.

The anti-shoe has a rounded sole that is supposed to improve posture and increase muscle activity. I'm not an orthopedist, so I have no idea if it works or if it's just a marketing trick. I only know it increased my girlfriends involvement and made her spend a lot of money on a pair of anti-shoes, she would have never spent on shoes.

Katie Konrath: "Innovation is About Failure"

"Consistency is the last refuge of the unimaginative."
- Oscar Wilde

Today, I'm launching a little brand.extension of my own: From now on, I am going to include interviews in this blog. Every month, I will interview an expert on a field related to brand management. You can find the interviews by clicking on the new "Interviews" button in the navigation bar at the top of this website.

My first interview guest is Katie Konrath. Katie is a creativity specialist who helps companies come up with fresh new product and service ideas, increase visibility, and attract new customers. She runs a top innovation blog, getfreshminds.com - ideas so fresh... they should be slapped, and is one of the authors of the Personal Branding Blog.

Hi Katie! Today, many brands seem generic. Consumers can‘t really see differences between brands of the same category anymore. How can innovation help here?

The reason why many brands seem generic is they do the exact same thing. They figure out what has worked reliably in the past and then they take the safe route every time. Unfortunately, when companies do what is "safe", it gets to the point where people can't see any differences between brands anymore. Innovation can help brands coming up with new ideas that make them stand out from the rest.  When new innovations take a product or service far beyond what is already available, they create a whole new market. And then, when the competition is obsolete, it's easy to stand out.

One of the most important things in brand management is consistency. That limits the room for innovation. How can consistent brands still be creative?

It depends on what your brand is about. Let‘s say you have a brand such as Coke. Since that brand is known for its specific taste, there isn't much room to innovate with the product. You have to have a specific color, you have to have a specific flavor. With such a brand, marketing is really the only opportunity for creativity. However, if you have a brand like 3M, Pixar or Apple, a major part of the brand is being creative and come up with new innovations. In those cases, customers are always waiting to see what the brand comes up with next. If a brand wants to be innovative while still being consistant, the brand needs to get its customers to expect innovation from it. It does that by demonstrating that it's not a static brand that never changes no matter what happens to the times.

What do you think is the main reason why companies don‘t innovate enough?

Because it is risky. Innovation is about failure. If you never take a risk, innovation is not going to happen and you are never going to come up with great ideas. Many companies are too focused on the bottom line, too focused on making their shareholder value and too focused on showing profit with everything they do.  They are constantly trying not to make mistakes that will cost them money.  But you can‘t come up with fantastic innovations unless you screw up once in a while!

In today's globalized world, it became a lot easier for your competitors to copy your innovations. Is there any safe way to protect them? And if not, doesn‘t that make innovation less important?

There are not many ways to protect innovations right now. It takes a long time to get a patent certified. If you actually go through that process you‘ll probably miss the market opportunity. But that doesn‘t mean innovation is less important, in fact it makes it more important because everyone is trying to be innovative and come up with the next big thing. Your brand will become obsolete very quickly, if you fail to innovate. If you come up with an innovation that is ahead of the competition and creates a market of its own, however, you can get an advantage in consumers minds that your competitors can't take away from you, even if they catch up to your technology. You don't need a patent if you are the brand customers think of when they think of your market.

Can you give us a "best practice“ example? What brand is doing a GREAT job at being innovative?

Of course, I have to name Apple. They are always on the forefront coming up with new ideas. Another company that is doing a good job right now is amazon.com. They have come up with an ebook reader that takes exactly what their customers love to do - read lots of books - and gives them a new way to do it. They're addressing all the frustrations book lovers face - books take up a lot of space, are heavy when traveling, take a couple days to arrive by mail - and solved those problems by creating the Kindle, which supports amazon.com's business further by making it incredibly easy for book lovers to buy books anytime and anywhere.  It's a great example of how a brand can create new opportunities and a new audience for itself without abandoning its core principles.

Thank you for the interview, Katie!

If you want to learn more about the field of innovation, you should read Katie's blog at getfreshminds.com and at the Personal Branding Blog. She is also on Twitter, so don't forget to follow her there!

My Top 13 Insights for Successful Brand Management

Some things seem too simple, trivial or irrelevant to write a blog post about. I'm not always aware that many people don't have the same marketing background as me. What's obvious and self-evident to me, may be new and insightful for someone else - and hopefully for you! That's why I made this list of some basic, yet very important brand management insights.

It is Friday 13th and here are my Top 13 Insights for Successful Brand Management:

1. A brand is much more than a name, logo, or sign. It is everything that name or logo stands for: the associations in people's heads, the benefits connected with it, the differences between the brand and its competitors.
2. The core of a brand is its brand identity. Brand identity makes your brand accessible for management. It is the engine of a brand.
3. Brand identity is very similar to human identity. It is not a personal identity, but the identity of a group.
4. This group consists of everyone who represents the brand: CEO, managers and employees, but also external sales reps and call center agents.
5. Thus, internal brand management is just as important as external. You cannot build a strong brand identity without the support of your employees!
6. The key to building strong brands is brand commitment. If your employees share the same values and vision as your brand, they will spread the word for you. That is what we call brand citizenship behavior.
7. Studies show that people project human characteristics on brands. A brand can be exciting, dull, honest, or devious. We call that brand personality.
8. Brand image only exists in consumers' heads. It is a reflection of the brand identity.
9. That is why it is not possible for marketers to build or change the image of their brands directly. Brand management is always about managing brand identity. Brand image is a result of it!
10. Brand positioning is what marketers do to translate their brand identity into a brand image in consumers heads. The latter is what matters for its success. If your positioning is successful, identity and image will be very similar.
11. Not every brand can create every brand image. You have to listen to what consumers want, but you also have to find out what you can do. Could Microsoft be Apple? Or could Apple be Microsoft?
12. Brand competences are part of the brand identity. They determine what a brand is capable of and how it can outperform its competitors. What is your brand's competitive edge?
13. Every strong brand tells a story. It can be the story of how the brand became what it is today. Or it can be the story of its founders' lives. Every brand has something about it that is worth telling. What is your brand's story?

 

Do Positioning Rules Apply to every Brand?

Two of the most common lessons, taught in virtually every marketing book, are:

You can't be everything to everyone.

and

It's better to be a big fish in a small pond, than a small fish in a big pond.

Some authors might use different words, but basically those two sentences describe, what brand positioning is all about.

If that‘s true, then why the heck can brands that don‘t follow these rules still be successful?

I‘m not talking about barely successful. I‘m talking about Microsoft successful, Coke successful, McDonald‘s successful, General Motors successful (ok that last one is a bad example, but at some point they must have been successful, I suppose).

Those brands are everything to everyone and although they swim in large ponds, they became pretty huge fish. And huge fish don‘t like small ponds. That big-fish-small-pond rule is the exact opposite of human nature. We always want to get better, achieve more, go for greater success. We don‘t stay in the ponds we‘ve outgrown. That's why it's so hard for marketers to stay focused on one segment. It's too tempting to strech the brand.

If it works for Microsoft, Coke and McDonald's it should work them, too, right?

Wrong! Let's take a closer look: Microsoft, Coke and McDonald‘s never really left their pond (they merely swam around the edges to check how elastic they are). They started as small fish in small ponds and when they grew, their ponds grew with them. They were pioneers, innovators in their specific fields. Today everyone drinks Coke, eats at McDonald‘s and uses Microsoft software. They are not just everything to everyone - they own their categories: Coke IS soda, McDonald‘s IS fast food and Microsoft IS computer software.

They are so generic for their category, they don‘t need any other brand positioning. Microsoft doesn‘t even need any brand strategy whatsoever. If you have a quasi-monopoly, brands don't matter much (evem though I bet Apple would beg to differ).

Most brands, however, are much, much smaller and don‘t offer any revolutionary products that create their own industries. For these brands, neither of the above would be a good example of how to manage brands successfully. If you start out with no competition, you can make mistakes. If you have grown to be a market leader, you can make mistakes. If you are a regular sized fish and your pond is a highly competitve market place, you‘d better stick to the positioning rules.

New design for brand.extension

I spent hours of learning CSS, designing banners and buttons on Photoshop and fighting with the mighty gods of TypePad - but now it's here: My new blog design.

I'm not a web designer, so I'm extremely proud that I made this all by myself. It might not be the most beautiful or creative design you'll ever see, but for me it's a big deal to give my blog a somewhat more professional look.

I hope you like it and keep enjoying my posts. If your new to this blog don't forget to subscribe!

Tobias

Are You in Control of Your Brand?

How do you stay in control of your brand?

That's a question a lot of marketers think about. In order to communicate a clear and consistent brand identity, they want to make sure they have control about all brand touch points - that's every place and time consumers might get in contact with the brand.

In today's world, that is virtually impossible! On the internet, information is accessable to everyone within seconds. With the emergence of social media, internet users are not only receivers, but also senders of information. Consumers discuss about companies, brands and products in forums, blogs, social platforms like Facebook or Twitter. There is no way for brand managers to stay in control of the information passed online. Hence, there is very limited (direct) influence on consumers.

The role of a company in the social media world is being "enablers" and "listeners". Their job is to enable consumers to talk about their brands (e.g. by giving out information or supporting social platforms where people can meet to discuss), as well as listen to what they say - and hopefully use that information to improve their brands.

However, even in the offline world the potential to control your brand touch points is limited, as Europes biggest touristic group TUI found out last week:

While German news channel N24 reported on the plane landing in the Hudson River, they were showing a commercial for TUI's airline TUIfly at the bottom of the screen for several minutes.

Slogan: "Willkommen an Bord" ("Welcome on board").

 

 

I'm sure the TUIfly marketing department was not amused...

(via Stefan Niggemeier. Photos by Thorsten Lohmann & Hendrik Runte)

Can McDonald's ever be Green?

(This is the second of the two blog posts on green fast food I promised you on Christmas Day. Sorry for the delay, but I didn't have the time to write it earlier!)

Could McDonald's ever be a green brand? And would they even want to?

A while ago I wrote about how the big fast food brands can't market organic fast food yet:

"Organic is the dominant factor in organic fast food, and organic is not what these brands stand for. (...) After consumers have learned about and accepted the concept, the big brands can adopt it."

I still believe this is true. While there are other ways than organic ingredients to make a business greener (like saving energy, purchasing from local suppliers or using less packaging), a green product is still what makes the biggest impact on your brand image.

From the fast food brands I examined in my survey about green fast food*, McDonald's had by far the worst brand image. In fact, their image is very much the opposite of the ideal fast food brand. It seems like all the bad connotations of the fast food market are connected much stronger with McDonald's than Burger King or Subway. So, how could McDonald's ever become green?

McDonald's has been the fast food brand that changed the most over the last couple of years. The introduction of McCafé certainly was a big move, positioning them as a competitor for Starbucks. Some years ago it seemed like Starbucks could be a threat for the big fast food brands. They fit perfectly into the lifestyles of urban people, offering "healthier" fast food additional to their coffee selection.

Today, it is McDonald's who are taking away business from Starbucks. There are two reasons for that:

1. Starbucks failed developing their brand. They jeopardized their USP by expanding o fast. Especially in the European markets it became obvious they had no clue about how to position themselves. If you can get better coffee for half the price, why would you go to Starbucks? They failed to answer that question.
2. McDonald's was open for change without giving up their strengths. They changed the look-and-feel of the restaurants and added typical coffee shop products to their menu. With their aggressive price strategy, they took advantage of Subway's weak brand positioning and bolstered their own brand at the same time.

Three years ago I would not have thought McDonald's could successfully do, what they just did. I totally underestimated their capability to change. Yes, they are opportunistic copycats, but they managed to make these changes while still focusing on their strengths. That's brand evolution!

It would take a lot of changes to make McDonald's an authentic green brand. But none of them would really weaken their strengths or their positioning! If green fast food goes mainstream, I can see McDonald's finding a way to make these changes.