The Value Proposition

Why should a consumer buy from you?

Competitive Advantages

What makes you better than your competition?

Choosing A Differentiation Strategy

You chose a target market, now what?

Tuesday, September 27, 2011

Facebook helps advertisers engage their customers

I'm taking a break from my review of basic marketing fundamentals to discuss something key from the recent Facebook F8 event.

On September 23rd, Michael Lazerow published an article on Adage commenting on Facebook's Ad product evolution.  In his post, Michael comments on three key items:
  • Facebook now helps you build better connections
  • Facebook can be used to let your customers tell your product's story
  • Facebook can help you unlock the value of people
I want to comment more on these ideas.

First, the whole "point" for a business using Facebook is to connect with their customer.  Seems like a no-brainer, right?  Maybe ... but what many businesses assume is that once someone "Likes" their business, they are instantly connected, and their "Likes" will pay attention to whatever they post, even if they post nothing.  "Like" DOES NOT equate to "connecting".  Mr. Lazerow is correct when he says, "It's about what you offer them and it's clear that the company's (Facebook) focus has shifted from growth to engagement" (reference to Facebook added).

Facebook isn't about announcing another product.  It isn't about beating your chest.  It's about posting CONTENT that is relevant to your customer.  It's about GIVING them something that matters. If you sell cameras, post tutorials about photography techniques.  Give them tutorials focused on teaching them to use your product.  Post a 50% off coupon for Facebook members for camera accessories.  GIVE them something that is VALUABLE to them.  Remember when we were talking about Brand Equity in my last post?  Facebook is a great place to build brand awareness and brand equity.

Use your customers to build your brand equity.  Have them tell your product's story.  Have them show and tell others about how they have used your product.  Their voice (positive and negative) carries more clout and emotional credibility than yours ever will.  Continuing on the camera example, inviting users to post their photos from vacations with your camera allows them to share their emotional connection with your product.  Awarding prizes for the best photo taken with your camera helps to strengthen the customer's "bond" with your product and brand.  The "community" built, and the quality of photos submitted (hopefully) will build better brand equity than you could do yourself through traditional advertising via any medium.

Advertising doesn't always "reveal" the fact that your customers have value.  They don't just give you money.  They are a very real voice in the marketplace.  Make them a voice for you.  Facebook (and potentially Google+ in the future) allows you to connect and unlock their value in a way that we never had before social networking existed.  It's time for you to take advantage of it and truly engage with your customer to build your brand equity.

Credit: Adage

Saturday, September 17, 2011

Is Anyone Aware?

One of the items I mentioned last week was Brand Awareness.  What is Brand Awareness?  It is the measure of a consumer's knowledge of your very existence.  The "aggregate" level is the proportion of consumers that "know" your brand.  Why is this "level" even important?  It's important, because the creation of brand awareness is the PRIMARY goal of advertising, and it influences the behavior of the buyers of your product.  However, remember that all of your measurements of brand awareness are, at best, approximations.  They are not exact. The more measures used, the more complete your understanding of brand awareness will be.

Brand awareness is measured "simply" by showing a consumer the "brand and asking whether or not they knew of it beforehand.  Many textbooks have conceptualized brand awareness simply as the knowledge that the brand is a member of a particular product category, such as fast-food.  However, common practice says there is more than one recognition and recall measure, all of which test the brand name's association to a product category cue.

However, "knowledge" doesn't give us much data to do anything with.  So, we use three common metrics that can be measured:
  • Brand Recall - Either the brand name or both the brand name and category name are presented to survey participants.
  • Brand Recognition - The product category name is given to participants, and are then asked to recall as many brands as possible that are members of the category.
  • Top of Mind Awareness - Brand Recognition, but more specifically only the first brand recalled is recorded (called "spontaneous brand recall" by some).
These measurements can be used for creating an understanding of Brand Equity.  Brand Equity is the positive effect of the brand on the difference between the prices that the consumer is willing to pay compared to the perceived value of the benefit received by your product.  The more value, the more a consumer will pay for your product.  Brand Equity is built by brand awareness activities such as advertising, PR, and promotion.  Simply put, the more Brand Equity, the more you might be able to charge for your product.  Higher prices can lead to higher profits.  You're in the business to make money right?

Monday, September 12, 2011

Brand Assessment

Last week I discussed the details of Brand Architecture.  Before I talk about further evaluating a Brand Architecture, I wanted to explore the Brand Assessment.  The data gained from researching and evaluating your brand in an assessment is a key requirement before considering any future change in your Brand Architecture.  If you don't know anything about your brand in the marketplace, you cannot make any intelligent decisions about it's direction in the future.

There are two key parts to a Brand Assessment: the Brand Essence and the Brand Communication.  

When reviewing your Brand Essence it is important to determine:
  • Awareness: Are you known in the marketplace?
  • Favorability: How do people feel about you?
  • Function: What benefits do you provide your customers?
  • Key Driver: What prompts consumers to engage with you?
  • Support: What "backs up" your key function in the marketplace?
  • Differentiation: What distinguishes you in the marketplace from everyone else?
  • Personality: What compelling attributes define you?
  • Quality: What is the quality of your brand in the marketplace?
When reviewing your Brand Communication, you should review:
  • Messaging: What messages are the most compelling to your current and potential customers?
  • Name: How effective is your current name in the marketplace?
  • Logo: How effective is your current logo in the marketplace?
The amount of detailed, reliable data you can collect on each of these areas will help you determine the direction your brand should go in the future.

Tuesday, September 6, 2011

Brand Architecture

Last time I presented a short definition, and some questions for consideration, regarding performing a Brand Audit.  Now, we're going to start to look at different aspects of a brand audit.  First, we're going to review Brand Architecture.

Brand Architecture defines how subordinate brands relate to the parent brand, and to one another.   Structures range on a scale from:
  1. House of Brands
  2. Endorsed Brands
  3. Umbrella Brands
  4. The Branded House
Let's look at each one in a bit more detail.

House of Brands
All brands within a House of Brands have no apparent obvious link to the parent brand.  An example of this would be the family of P & G products.  Tide, Crest, Cascade, and Bounty are all subordinate brands to P & G.  However, they are marketed on their own merits, with their own separate marketing budgets and campaigns.  A House of Brands approach is useful in situations where the parent company has no real brand equity on it's own merit, but it's products, such as Tide, do.

Endorsed Brand
In this setup, the parent brand endorses distinct, branded offerings in a variety of segments and/or categories.  A couple of examples would include Courtyard by Marriott, or Polo by Ralph Lauren.  The intention is to add credibility by leveraging the brand equity of the parent brand.

Umbrella Brand
An umbrella brand (also known as Family Branding) shares its identity with the parent brand.  Examples would be Sony Playstation, Buick LeSabre, and Gillette Sensor.  There can be economies of scope associated in this situation, because multiple products can be efficiently promoted within a single campaign. It also helps facilitate new product introductions by providing a name that is familiar with the target consumer.  However Umbrella Branding can create a greater burden on the parent brand to maintain consistent quality throughout all product lines. If there are quality issues with one product in the family, it can impact the reputation of the others.

Branded House
All product lines in a Branded House share the parent brand name, and as such, each product offering is identified in much more generic ways.  Examples of this are the Red Cross, GE Capital and GE Appliance.  All product lines are truly subservient to the parent brand, and rely solely on the parent brand's equity.

When evaluating your brand architecture, there are many things to consider.  Merriam Associates published a fairly comprehensive list in 2009 that covers this well:
  • Audience Diversity
  • Brand Elasticity
  • Product and/or Service Offerings
  • Competitive Context
  • Brand Equities
  • Geographic Needs
  • Organizational Structures
  • Ownership
  • Sources of Growth
  • Purchase Criteria
  • Brand Performance
  • Brand Role
  • Channels
  • Company Specific Issues
I will cover each of these items in more detail in the future.  However for the purpose of this post, keep in mind that you will need to take many of these items into account when deciding your ultimate brand architecture.

Strategic Consideration list credit: Merriam Associates