Why category positioning is paramount to building a successful technology brand.

Ray Baird is President of RiechesBaird

During the first part of this series we spoke about the importance of defining your business category and brand positioning. The second part focused on the approach and type of insights you must acquire before entering the strategic phase. To finalize this series, we need to explore ideation; defining your category, crafting a winning position and establishing brand strategy.

First of all, ask yourself and your team a very simple question. Does your current and future business model/strategy and offering fit into an existing category that is clearly recognized and defined by your audience and qualified industry analyst (such as Gartner or Forrester)?

If the answer is yes, then you can craft a well-defined category description base upon the current interpretation and competitive considerations set, but more importantly you must now clearly understand who already owns what in the category and determine what positioning will give you the greatest value and differentiation.

Clearly if any of your competitors already own a positioning space that’s seated in the mind of your audience, stay away from trying to take it over. In our experience this is a losing proposition. Remember how your customers think. They will know you for ONE thing (as the accompanying video so poignantly points out).

So pick something you can own long term. Something fresh. Something new. And that usually starts with being first at something.

A good way to start thinking about a winning position and brand strategy is to ask yourself a few questions to generate ideas. Here’s a few things to think about:

1. What are you good at?
2. What do you love to do?
3. What can you be famous for?

(Thank you to Tom Peters for providing this wonderful way to explore brand positioning.)

Once you’ve articulated these thoughts, put yourself to the test of trying to narrow it down to one word or simple idea. Remember, the more narrow the focus the stronger the technology brand. Throughout history most great technology brands can be articulated in a word or two.

Dell owned personal (before it was commoditized). Linksys owned networking before they were bought by Cisco. And Cisco is trying to own Human Network. And the list goes on.

So you see, it must be simple. It must be believable. It must be relevant and most importantly it has to be defendable! These are always good criteria to put against your thinking.

But what happens if you don’t fit into a category? What happens when Gartner or Forrester don‘t recognize or have a category that fits your business? Well, that’s a little tougher.

Basically you’ve got a few options:
1. Work with Gartner or Forrester to co-develop the category (this takes time and money).
2. Identify the category you are closest too and tweak the definition slightly so your audience understands but gets a refreshed view and new spin on it.
3. Create a new category. This is the most courageous/interesting and potently valuable. However, it’s also tricky and takes considerable thinking, making it a great idea for the subject of a future blog.

Technically speaking, understanding what business you are in and defining your category and position is fundamental to growth and building value. But that’s just my opinion, what’s yours?

I hope you enjoyed this series, please submit your comments, experiences and suggestions on other topics you’d like to discuss. Best of luck with your businesses.

Who is part of the Brand Council and what are its functions and processes?

Benjamin Bidlack is Brand Strategy Director at RiechesBaird

Last time, we talked about why almost all companies, technology companies especially, need a Brand Council. Technology companies in particular struggle to enhance the value of their brands by aligning their activities to deliver a fulfilling customer experience beyond the functional and/or technological benefits they offer. All genres of technology are being replicated more and more quickly each year, and customers are getting more and more sophisticated.

The beautiful and invaluable thing to remember about a great technology brand is that it can’t be copied.

Constituting a Brand Council for technology-focused companies

We suggest following two guiding principles to determine who should be a member of your Brand Council:

1. Your Brand Council should have a senior representative from each functional area, since all areas impact the delivery of your brand promise, including:
·         C-suite management
·         Operations
·         Human Capital Resources
·         Finance
·         Marketing
·         Sales
·         Legal
·         Public/Investor Relations
·         Research and Development
·         Administration

We recommend that you also retain an external consulting partner to maintain an objective point of view and provide your Brand Council with current and top branding strategies.

2. A member of senior management should be your Brand Council Leader. This individual should represent the importance and visibility that your organization wishes to give to the brand. We recommend a CEO or COO. The Brand Council should also have a Chair who is responsible for setting the agendas and directing the meetings.

The Brand Council provides strategic brand governance in five categories:
1. Creation/management of the brand
2. Challenges and opportunities for the brand
3. Brand compliance
4. Brand measurement and refinement
5. Brand culture

Beyond “Logo Police”

Following are the types of issues that you may encounter in your Brand Council, grouped into the five categories introduced above.

Brand Council's Information Flow

1. Brand Creation/Brand Management
a. Alignment between business strategy and brand strategy
What is our business strategy, including our short- and long-term business objectives? How does the brand strategy bring this business strategy to life?

b. Business objectives formulation and assessment
How can we leverage the brand to achieve our business objectives (i.e., revenue growth, cost reduction, market share growth, etc.)? How have these objectives changed in the last year/quarter and what impact could these have on the brand?

c.   Product and /or service portfolio decisions
Which products/services complement the brand direction and, therefore, warrant a current or future investment? Conversely, which products/services should be rationalized because they no longer match with the brand promise? What is the best ongoing process to review our portfolio?

2. Brand Opportunities and Challenges
a. Operational choices and decisions
How should the brand promise guide everyday operational issues and/or decisions (e.g., work quality, defect rates, product design, response times, communication gaps, product line or service gaps)? Conversely, how do these operational issues and/or decisions affect the brand?

b. Customer targeting
Which new customers are most likely to benefit from the values, objectives and promise that our brand stands for?

c. Merger and acquisition evaluation
When evaluating potential mergers or acquisitions, which organization(s) would complement our existing brand promise? How do these organizations fit into our existing portfolio? What would be the brand implications of merging with or acquiring these organizations? How can we manage the brand to maximize value for an upcoming liquidity or merger event?

d. Prospective partner assessment
Which potential co-branding partnerships will align with our brand promise and values? Which of these partnerships might be most beneficial for building brand equity?

e. Competitive analysis and response
How does the brand help us differentiate ourselves and de-position our competitors? How can the brand dictate our response to competitive activity?

3. Brand compliance
How do advertising, communications, signage, online and other applications of our identity (e.g., logo, visual vocabulary, language and tone of voice) align with our guidelines for consistent brand expression? Should there be differences in brand expression in the organization and, if so, what are these differences? What are the challenge areas (e.g., too many versions of the logo, inconsistent execution across applications) in the expression of the brand?

4. Brand measurement and refinement
General brand assessment What is the state of the brand (e.g., metrics definition and tracking, findings and implications from any recent brand research, recent media mentions, share of brand choice, etc.)? How do we measure the brand’s performance against the competition in a changing marketplace?

5. Brand culture
a. Brand culture assessment
How deeply are our employees engaged with the brand? How well are our brand attributes being embraced internally to help shape desired behaviors and attitudes? What new programs should we develop to keep people engaged and “living” the brand?

b. Customer touchpoint management
How well have the multiple interactions that customers have with the organization been considered and aligned with the brand? Have touchpoints been mapped and analyzed for improvement so that investment can be directed to those that have the greatest potential for positive impact on the customer experience?

Next time, in Part 3 of 3, we’ll look at specific ways to turbo charge your Brand Council, and pitfalls to avoid.

Part 1 of 3: What is a Brand Council, and why tech companies need them

Benjamin Bidlack is Brand Strategy Director at RiechesBaird

It is now commonly understood that brands represent significant corporate value and are among an organization’s most valuable assets. This value has been demonstrated in brand valuation rankings and acquisition prices worldwide.

Properly created and managed, your brand helps generate operational and economic value by:

- Enhancing awareness, consideration, trial and loyalty
- Adding value to your offering beyond price or technology, both of which can be copied
- Attracting and retaining customers with an engaging promise and experience
- Guiding and informing business decisions and activities
- Attracting and retaining top-tier talent and partners
- Easing entry into new markets
- Commanding price premiums
- Facilitating brand extensions into new products and categories

One of the most pressing challenges we address with clients is how to make business decisions that are consistent with their brand. Technology companies especially struggle to enhance the value of their brands by aligning their activities to deliver a fulfilling customer experience beyond the functional and/or technological benefits they offer.

Consider the following questions:

- Our tech firm has developed a new offering/product/service. Do we need a separate brand? Why or why not?
- One or more aspects of our performance may be hurting our brand image. How can we prioritize where we should take corrective action to protect and build our brand?
- We’re considering a merger, partnership or divestiture. How might that affect our brand(s)? How do we assess which brands to use, how to transition them, over what time period, and why?

Your organization is collectively responsible for creating an expected and consistent brand experience. The challenge becomes how your organization, with its multiple layers, multiple divisions and multiple markets, comes together to address the strategic and tactical issues related to brand management.

The Brand Council defined
A Brand Council is a leadership group, led by the CEO and representative of your larger organization, with one mandate:

To ensure that business strategies, processes, decisions and actions are aligned with the brand’s positioning and values – namely, your organization’s unique promise of distinction.

This, in turn, focuses the entire organization on delivering the fulfilling customer experience that secures loyalty and future earnings. Apple’s brand practically guarantees that every new product or partnership will meet with huge demand, forgiveness for mistakes and general success. Apple has a top secret Brand Council, led by Steve Jobs and other key leaders, whose job it is to steward the brand, and with it, Apple’s success.

The Brand Council provides strategic brand governance in four categories:

1. Creation/management of the brand
2. Challenges and opportunities for the brand
3. Brand compliance
4. Brand measurement and refinement
5. Brand culture

Next week, in Part 2 of 3, we’ll look at the specific makeup of Brand Councils around the world, the 5 functions they typically perform, and the process by which they do it.

In the final installment, in Part 3 of 3, we’ll look at specific ways to turbocharge your Brand Council, and pitfalls to avoid.

Ray Baird is President of RiechesBaird

Do you know what predicts your brand’s success?  Most marketing metrics only measure what has happened, using what could be called “lagging indicators.” But imagine the effectiveness of your marketing program if you could identify the “leading indicators” for your brand; the activities, buyer behaviors, and measurements that actually lead to sales and profits.

Progressive marketers and their agencies are exploring this brave new frontier.  Instead of just looking in the rear view mirror at historical measurements like sales and market share, they are attempting to look ahead at predictive measures that are the actual precursors of business success. Most “leading indicators” never appear on a financial statement, but they can – and should – be identified, tested, and tracked.

Identifying the real causes of brand health is vital to successful brand management.  For example, most brands with call centers, which includes a lot of B2B brands, commonly measure such things as time on hold and minutes per call.  But these metrics don’t measure or predict real customer satisfaction.  Research by Convergys shows that customer satisfaction is predicted by two things: 1) Is the customer service representative knowledgeable? and 2) Is the problem resolved on the first call? (Convergys 2008 U.S. Customer Scorecard.)

An important difference

Lagging indicators are simply a measurement.  Leading indicators are a measurement tied to a hypothesis, which can be tested and refined, in order to explain or predict behavior.  Imagine six friends getting together every Friday night to play poker.  Over the course of a year, on person wins 60% of the time – the other players win much less often.  These statistics are all lagging indicators; they tell us what has happened.  But they don’t tell us why.  You might be inclined to think the 60% winner cheats, but in fact he wins so often because everybody else in the group has such a poor poker face.  The point is that you learn nothing by observing the result – only by understanding the process that leads to the result.

For example, If you reverse engineer most successful marketing programs, you’ll find that they center around a hypothesis based on a powerful insight into buyer behavior. That hypothesis can almost always be considered a leading indicator.

All measures are not created equal

While predictive is better than historical, this isn’t to say there isn’t a place for lagging indicators in marketing measurement. Some lagging indicators – such as incremental profits generated from a campaign – are important and relevant measures of marketing success.  The same is true with lagging indicators like brand penetration and average price per unit.

But many traditional measures of success are the result of historical practices rather than a careful study of cause and effect.  Correlation is not the same thing as causation.

For example, while sales is the most common “hard” metric of success, campaigns that focus on reducing price sensitivity are more effective than those that focus on building volume or market share.  In other words, we’ve learned that value share more important than volume share.

As Einstein said, “Not everything that counts can be counted, and not everything that can be counted counts.”

Brand health as human health

It’s critically important to measure B2B brand success using a combination of both leading and lagging indicators.  You can think of the health of a brand in the same way we think about the health of a human body.  A physician would never attempt to diagnose a serious problem merely based on a few outward symptoms.  He or she would also likely measure temperature, blood pressure, organ functions, and other things that would give a more complete picture of health.  Diagnosing and monitoring the health of a brand involves the same dynamics.  Sales and market share alone only tell us the brand is healthy or sick, but don’t tell us why.

(SIDEBAR)

Two Different Kinds of Indicators of B2B Brand Success

At a time when marketers are looking to prove the value of every marketing dollar spent, their agencies have an opportunity to provide an immensely important new dimension of value by helping their clients develop and test leading indicators of brand success.  Far too many agency-client relationships begin only with a “scope of work” instead of an understanding of “scope of value,” a clear distillation of the desired outcomes that combines both lagging and leading success metrics.

Knowing the metrics that matter should be part of the intellectual capital an agency brings to the relationship it has with its clients. By measuring what matters, brands can make limited marketing dollars go much further in these economically challenging times.