Entries tagged as ‘Brands’
Joel Spolsky, an entrepreneur and columnist for Inc., wrote an interesting piece last month asking whether his strategy of slow, consistent growth was actually a recipe for failure:
I have always believed that there is a natural, organic rate at which a business should grow, and that if we expanded too fast, the wheels would come flying off. Then I came across a quote from Geoffrey Moore, who is best known for his best-selling book Crossing the Chasm, which is about how businesses cross over from their initial niche markets to dominate larger markets. In another book, called Inside the Tornado, Moore writes about the great battle between Oracle and Ingres in the early 1980s. The winner of that battle is well known: Oracle now has a market cap of more than $100 billion, and I’ll bet you’ve never heard of Ingres. Moore explains that “for pragmatist customers, the first freedom in a rapidly shifting market is order and security. That can only come from rallying around a clear market leader. Once the apparent leader-to-be emerges, pragmatists will support that company, virtually regardless of how arrogant, unresponsive, or overpriced it is.”
The reasons why breakneck growth may be preferable to steady, conservative growth can be summed up in two bullet points:
- As noted above. network effects that attach to the market leader
- Generation of revenue and capital that can be reinvested in the firm to improve systems, products, as well as increase advertising spend and bolster sales efforts
To be sure, these are logical arguments. However, I think to what extent the logic holds is dependent on a few factors, such as product and/or industry. Additionally, whether a high-growth strategy will be successful depends in large part on whether their is a plan at the outset that includes provisions for how to effectively manage the growth. Continue reading
Categories: Uncategorized
Tagged: Brands, Business, Economics, LinkedIn, Strategy
Ana Andjelic channels my thoughts on data- and fact-based decision making in an interesting post on ad campaigns:
How can we then decide that a campaign was “better” than another one? We rarely look at a campaign data – partly because the actual metrics data is proprietary and not available to anyone beyond walls of an agency and of their clients…
General, and generally available, feedback mechanisms and benchmarks for success don’t really exist. While it may not have been possible before to know exactly if a TV/print/outdoors/radio campaign influenced particular brand affinity and purchase decisions, digital lets us do things differently.
This means that we don’t have to judge works of others purely on elusive criteria of “creativity”, but on actual data on how this creativity fared with people (what did they do? and what did they do next?).
Read the whole thing.
Categories: Uncategorized
Tagged: Advertising, Brands, data, data-driven world
September 19, 2009 · 1 Comment
Kevin Randall at FastCompany pens an interesting piece on the rising tide of sentiment analysis–the players, the technologies, the possibilities, and the current pitfalls. The idea behind sentiment analysis is pretty simple (but the execution is difficult): to identify and code attitudes, whether written or verbal, towards particular topics. The explosion of activity on the web (blogs, social media platforms, etc.) has created an enormous amount of data that typically includes some 
kind of feeling towards the topic. This is a researcher’s and marketer’s dream–a plethora of opinion from which to mine and analyze. The key, however, is to be able to easily collect, code and analyze that data. The most difficult of these three steps is coding–how do you efficiently designate millions of utterances on the web in terms of their “polarity (positive or negative), intensity, and subjectivity”? Randall notes the initial problems with accuracy as well as other open questions:
Computer deciphering of word meaning is not always accurate and tone can be completely missed. Even the leading vendors acknowledge that the data is 70-80% reliable. For example, we may know that the phrase “quite interesting” means one thing in America, another in Britain, but the computer would see the same meaning. Note some of the long-standing issues with voice recognition technology.
There are questions about how robust or representative the data is. Are a brand’s tweeters the key WOM influencers or are they just a small vocal segment?
Some brands and products may be under the radar for this technology. Yes we love to chat about Apple but do we also regularly, enjoy blogging and tweeting about Charmin or business insurance?
There are conflicting approaches, metrics and offerings; over time a common Microsoft, Google, Nielsen type platform may emerge.
The notion of accurate sentiment analysis is very intriguing, but, as Randall notes, it is far from a finalized technology. Continue reading
Categories: Uncategorized
Tagged: Brands, coding, data, market research, marketing, Sentiment
Sam Becker at Brand New discusses the recent branding and spin-off of AIG’s property-casualty unit. Unlike it’s namesake, the P&C unit turned a $2B profit. The unit is being spun-off in an attempt to generate capital to help pay back the large government bailout of the parent firm.
And while the unit itself is doing well and was not responsible for the $99B in loses at AIG last year, there is the delicate issue of what to call the firm and how to position it since the AIG brand is basically toxic at this point. The strategy seems to be: don’t stand out.
Becker goes on to describe the strategy:
The very recently risk-averse AIG is playing it safe with this one. Chartis, the name, is as inconspicuous as they come. It feels like one of those words that has been bouncing around the naming industry for some time now. It is descriptive without being specific. It is easy to pronounce and even easier to spell. As far as names go it is completely unobjectionable. So much so, that there are at least two other large, service-oriented companies that use the Chartis name and that’s probably ok. Sometimes a brand just wants to blend in. One could imagine the project brief went something like the scene from Oceans 11 where Matt Damon is coached on how to not stand out:
Don’t use seven words when four will do. Don’t shift your weight, look always at your mark but don’t stare, be specific but not memorable, be funny but don’t make him laugh. He’s got to like you then forget you the moment you’ve left his side.
Given the controversy around AIG it seems reasonable that what you may lose from abandoning the brand name that loyal customers know you by you more than make up for by leaving the Titanic that is the AIG scandal behind you.
Categories: Uncategorized
Tagged: AIG, Brands, Strategy
In another sign that companies and storied brands are being brought down to earth by the current recession, Proctor & Gamble has rolled out a less potent and cheaper version of its flagship Tide product called Tide Basic. The new product costs about 20% less than the premium brand.
The discount-brand is seemingly a reaction to the major hit P&G has taken on its premium brands. The Wall Street Journal reports that P&G reported an 18% drop in its fiscal Q4 profits, due mainly to the sharp decline in sales of its premium-priced brands.
The current move signals somewhat of a capitulation to competitor’s discount products. P&G used to rely on “new and improved” versions of its products in order to avoid dropping its prices, but like many other powerful consumer brands they have recently had to bend and drop prices as structurally consumers simply didn’t have the budget to continue purchasing P&G’s products.
The money quote that sums up the challenge for premium brands in a recession:
After years of spending $17 on bottles of Matrix shampoo and conditioner, 28-year-old Ms. Ball recently bought $5 Pantene instead. “Buying the more expensive stuff just isn’t as exciting to me — it’s not as important,” she says. “I don’t know that you can even tell the difference.”
And herein lies the challenge to brands: there is seemingly a point at which consumers will focus their attention on quality and the relative difference between a premium brand and a low cost, generic brand. If the difference is negligible (or perceived to be negligible) consumers will not pay a premium for the brand. Continue reading
Categories: Uncategorized
Tagged: Brands, Proctor & Gamble, Recession
I am in the process of fleshing out a post examining of whether professional service firms (PSF) are conspicuously consumed by businesses, much like luxury goods are by consumers. I’ve been wondering to what extent PSF’s can set higher prices based on their brand and any “Veblen Effects” that follow. Are high-end PSF’s subject to the same effects when they either lower prices or diversify their offerings into an area that appears more ‘pedestrian’? In other words, will lowering their prices and the complexity of their offerings dilute their brand?
Would be interested to hear folks’ thoughts as I begin working on the post.
Categories: Uncategorized
Tagged: Brands, Conspicuous Consumption, Professional Service Firms, Status goods
