Ray Baird is President of RiechesBaird

Is it just me or is the tech industry finally getting back to investing in their brands?

For some tech companies this may be good news, but for others it may be too late.

Let’s face it, 2009 was pretty bleak as it relates to creative marketing. Sure there were a few brave brands that continued to push the limits and invest during this downturn but for most technology marketers 2009 seemed more like a duck and cover exercise. Most of us expected to see the typical surge from the consumer electronics industry during the holiday season, but did you anticipate big investments from some of the technology powerhouses in the fourth quarter?

Let’s start with Intel (one of my favorite B2B brands). They continued to invest in their brand as usual but took a slightly different approach by moving beyond only product advertising (applause here). They introduced their new “Rock Star” campaign—“Sponsors of Tomorrow”, featuring their people— the very thing that makes them different. This culturally driven brand expression is brilliantly displayed in a contemporary but authentic fashion. If you have not seen the spots, I strongly suggest checking them out to see how B2B branding should be done.

Next, there is Yahoo spending in excess of $100 million on re-energizing its brand with the “It’s You” campaign. Although the campaign is eloquently produced, it’s not for me. It seems like Yahoo has been on vacation during the last several years of innovation and lost its once celebrated cache. Nevertheless, they are back in the game and it will be interesting to see how consumers react, or don’t, to their welcome back positioning.

We’ve also seen Microsoft demonstrate its commitment to investing in its products by launching the Windows 7 operating system to the tune of $300 million. So what’s with the recent surge of investment by Tech firms?

That’s simple, it’s time to get back in the game—and the ones who lead the charge are the ones who reap the rewards.  Let’s face it, whether you’re a large or small company, marketing is about timing and connecting. So, as you look at your own company, ask yourself a few questions.  Are we poised to take advantage of the first mover position? Is our brand correctly positioned in light of the major changes in the marketplace and is our messaging strategy relevant to the current audience needs. Posing these questions to your leadership team should bring up some interesting points of view.

But that’s my point of view? What’s yours?

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.

Ray Baird is President of RiechesBaird

I recently read an article in BusinessWeek entitled, “Tech: The Return of Risk Taking”,  it’s one of the most positive technology outlooks I’ve seen in a very long time. Basically Spencer E. Ante says, the worst of the recession is over, and it’s time to prepare for better times.  Mark M. Zandi chief economist of Moody’s Economy.com predicts 4% growth for 2010 and 10% in 2011 for IT spending. Although I love the optimism, I’m not sure these outlooks are fully in tune with the entire market, especially the mid and small segments.

So, the good news is that something is finally happening.  Dell’s deal for Perot Systems, eBay’s sale of Skype and Adobe’s purchase of Omniture are certainly big events for the technology sector. When the big brands start to excite  the market with M&A activity, the middle market and smaller entrepreneurs will follow, but that’s going to take a while. Mid and small  markets were hit the hardest and are still in operational reduction mode or stabilization mode to say the least.

But if history is any indication, America’s “Challenger Brand” mentality will prevail, especially in the technology market. I personally believe America’s brand reputation is tied not only to our technological competitive advantage but also to new and ever changing communication technology.  American brands must continue to reinvent  themselves to remain competitive. Lets face it, the days of leading the global economy with automobiles, electronics and commodity products are over. New rules have taken over old business models. Now, it will take courageous companies that are willing to create new categories, competitive advantages,  and most importantly to take “Risk”. Yes, Risk.

This brings me to a discussion that’s happening in most every board room these days. When should we begin to reinvest in gaining market share and presence?  Whether you drive your organization from an intuition based philosophy or calculated strategic risk mentality, one thing history can prove is that companies that get out into the market first reap the rewards. You’ve heard all the case studies, but do you really buy into the concept and are you willing to bet your reputation on it?

Bottom line, executives and marketers must be ready for recovery and smart ones will take risks to get ahead quicker.  Nothing like a recent history lesson to validate a concept;  As the 2001 recession began to rebound, the tech marketing investment (around 6%) outpaced the growth which ended up close to 5%.

That said, I have put together a quick check list of things for you to consider in your 2010 planning.

1. Create multi-tiered strategies with quarterly triggers:

Face it, the days of creating three to five year plans are a thing of the past. New rules dictate visibility of 24 months with a clear picture of Risk/Rewards scenarios on a quarterly basis. Build strategies that err on the aggressive side but are sound enough to back off slightly (no, not stop) if your budget gets squeezed.

2. Stay away from the “start and stop” syndrome.

Don’t put your company in jeopardy by starting and stopping your programs. You send mixed messages to the market and employees.  It’s critical to maintain confidence in the leadership team during these uncertain times. Changing your mind frequently is not a strategy.

3. Get the story right. Bring it to life.

Remember, somebody has hit the restart button. Most markets have changed. Be realistic. You must have a clear picture of your current value proposition and competitive advantage.  Don’t put your company in jeopardy by investing in a tired or irrelevant message. Stop, reset and validate your brand strategy.  Maybe it’s time to rebrand?

4. Try something new. Nothing risked is nothing gained.

If there was ever a time to try something new, it’s now. Consider the change in customer behavior. The social media explosion has brought the customer smack dab into the middle of the conversation and influence. Traditional media ideas have left the building. Every statistic you read says digital media budgets are replacing traditional spending. If you have not built a new customer acquisition strategy/plan with digital media as a primary consideration, now is the time. The risk of not trying is greater than the risk of getting out there.

5. Re-Energize your staff.

It goes without saying, these are tough times for the American workforce.  Your employees are under incredible pressure to deliver. Most organizations look radically different than they did a year ago. Take time to fully engage employees in your strategy and align them with the key initiatives. (Alan’s engaging employees slide deck). You can’t afford the risk of having employees standing on the side lines.  Celebrate every positive win possible and remember when business was fun.

So, as 2010 approaches, what’s your risk strategy? What will you be doing differently? I’d love to hear?

Ray Baird is President of RiechesBaird

Originally posted on B2BBrandDebate

On the surface this question presents some quick responses and initial thoughts as it relates to an external point of view. Most professionals would agree, re-brand when it becomes irrelevant or tired to the end customer, or when it loses its competitive advantage or differentiation. Certainly re-branding is critical when several companies or brands are merged together and have developed a new point of distinction–not re-branding in this situation can be dangerous and confusing. These are all obvious rational reasons, but B2B branders today need to address the current conditions and how it’s affecting internal B2B brands and their ability to stay relevant and motivated.

With the recent financial turmoil, most all companies are being forced to re-think just about everything. Will the existing business model and strategy continue work? Do we have the right leadership? How can we retain the key talent? How do we cut costs without cutting into the core? And how do we best communicate the changes that are happening? And most importantly, how do we keep our people motivated?

Whenever B2B companies and their employees undergo the type of radical changes most are experiencing it’s time to step back, re-think the internal brand strategy, re-consider the communication delivery and determine if the current internal brand needs to be freshened up, re-branded or just re-communicated.

Asking the following 5 questions to your leadership team, managers and employees can help you evaluate the situation quickly and provide direction:

1. Has our purpose changed? What is it?

2. Is our vision still relevant and inspiring? What is it?

3. Is our mission current, clear and distinctive? What is it?

4. Do our employees understand our strategy and how it relates to their role? What is it?

5. Are we communicating properly? How are we measuring?

So, when is the right time to re-brand? Depends on the answer to your questions. But most likely, the answers are inside.

Let me know what you think.