Every one of the largest, most successful corporations were, at some point, mere startups. McKee explains what enables some companies to growbigger and better, while others stumble along year after year, running but never winning the race. The difference is that the biggest and best brands aren't slaves to conventional marketing wisdom. McKee shows by example how the same, sometimes counter-intuitive, strategies used by the biggest brands can also best serve small and mid-sized companies. Among the topics explored: How can a company grow big by thinking small? Why do the best companies sometimes avoid being better? Why do brands that create the most memorable advertising stay away from focus groups? What is the secret to an effective slogan? When can admitting a negative become a positive? A diverse selection of companies provides powerful lessons, ranging from traditional icons like Coca-Cola, McDonald's, and General Motors, to new media models like Google and Facebook. This book appeals not only to time- starved executives, but also to middle managers and owners of small businesses who have a wide variety of marketing problems to address and who need to change the way they think about how to generate healthy, consistent growth.
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Leveraging the Success of the World's Best Brands
By Steve McKee
Palgrave MacmillanCopyright © 2014 Steve McKee
All rights reserved.
WHO COMES FIRST
IF YOU WERE A TRENDSETTING, OUTGOING, RISK-TAKING, SPORTS freak of a young man, what would be a great way to spend time with your friends? Buffalo Wild Wings has a suggestion: wings, beer, and the big game at a restaurant designed to provide the ultimate sports experience.
Unlike a lot of other casual dining restaurants, Buffalo Wild Wings clearly knows whom it serves. The chain avoids broad-based discounting, preferring instead to focus on the quality of its food and overall customer experience. It can do so because it knows who its core audience is and doesn't try to attract everyone. That's step one of power branding; the way to have sharp, clean edges in the marketplace is to know whose bell you're trying to ring.
That doesn't mean you can't serve a wide variety of customers; it's not that older men, or women, or nerdy types who otherwise don't fit Buffalo Wild Wings' core target profile don't eat there. But the experience is designed for a unique type of person marked by a well-defined profile that goes well beyond demographics.
Brands often think of their target audience in terms of age, income, and geography, or perhaps education or ethnicity. But people aren't driven by their demographics — not every young man is going to relish hot wings and cold beer at a sports bar, just as not every older woman would avoid them. Demographics tend to correlate with behavior, but they rarely cause it. If someone who doesn't fit the profile of who your brand targets wishes to do business with you, of course you'll take their money. But effective branding is not about whose business you'll accept; it's about whose business you seek. Buffalo Wild Wings simply won't be as pleasant an experience to those who are introverts, or don't like sports, or are vegetarians — regardless of their age and sex.
A few years back the Zogby organization posed a simple question to consumers: If you could only shop at one department store for the rest of your life, which store would you choose? It's perhaps not surprising that Walmart (26 percent) and Target (22 percent) topped the list, given their ubiquity and affordability — they simply appeal to the broadest cross-section of consumers. And it's also not surprising that Walmart loyalists tend to have lower incomes and are less educated than Target customers — important demographic criteria.
But if you look a little deeper into the data, interesting patterns emerge. For example, Walmart shoppers reported that they traveled less and tended to favor a Republican presidential candidate. Target shoppers said they traveled more and leaned toward a Democratic candidate. Those two characteristics say as much about who those stores' customers are as their income and education profile does.
Now throw other retailers into the mix. Costco loyalists look more like Target shoppers in terms of income, travel profile, and political views, whereas Sears' shoppers are older, more conservative, and even more likely than Walmart customers to own a home and a gun.
My point isn't to suggest that these retailers should build their appeal around singular dimensions such as political leanings, travel habits, or gun ownership (the Zogby poll didn't go into the specific depth that a custom brand identity exploration would). But the study does support the idea that people's varying behaviors, lifestyles, and leanings lead them to naturally gravitate to one brand over another — even in somewhat commoditized categories. There's not a brand on the planet that can't leverage that powerful truth.
If you seek to be a great brand, first determine who you want to think of you as one. And be careful that you don't take the easy road and make assumptions based on demographics alone. Sure, better-educated people are likely to be more knowledgeable consumers in general, but don't think for a minute that, say, a fourth-generation farmer who has only an eighth-grade education can't make a more sophisticated purchase decision about a new tractor than a PhD professor of agriculture. There's much more to people than meets the demographer's eye.CHAPTER 2
SMALL MEANS BIG
AS BUFFALO WILD WINGS' EXAMPLE SHOWS, THE MORE YOU want to enhance the power of your brand, the better you must understand just who it is you're trying to reach. And here's an important corollary: The narrower your target, the greater the intensity of your brand's appeal can be.
Mountain Dew, originally named after a slang term for moonshine, was first positioned as a hillbilly soft drink. For years it languished as such and as an also-ran in a category filled with big-spending competitors. But in 1993, the "Do the Dew" campaign appeared with a focus on what the company calls "Dew Dudes" — young, active, X Games–type men. Since that time, Mountain Dew has taken off to become the number four soft drink in terms of market share — behind Coke, Pepsi, and Diet Coke and ahead of Diet Pepsi, Sprite, and Dr Pepper.
How to explain Mountain Dew's success? It narrowed its target so it could increase the intensity of appeal. By focusing only on active, thrill-seeking young men, Mountain Dew could create compelling messaging just for them.
By sponsoring snowboarders and skateboarders rather than basketball stars and baseball players, Mountain Dew has clearly staked its turf, sponsoring the first-ever X Games back in 1995 and producing its own snowboarding movie, First Descent. The brand sponsors a professional skate team and has a YouTube channel called "How We DEW" that features the exploits of its athletes.
Further building on its branding success, Mountain Dew even curates a record label, Green Label Sound, with the goal of raising the profile of independent artists. It sponsors Green-Label.com, a branded content site designed to be a hub for youth culture. And in partnership with Burton, a popular snowboarding brand, it launched the Green Mountain Project, recycling plastic soda bottles and spinning the pellets into yarn that's woven through the fabric of an outerwear collection supported by the tagline "Drink it. Recycle it. Wear it." Now, that's brand loyalty.
What Mountain Dew has achieved as a brand would have been impossible if it tried to win market share by appealing to the broadest possible audience.
Credit card companies have understood this principle for years, targeting increasingly narrow audiences in an effort to boost their brands' relevance. They offer cards targeted specifically to university alumni, fans of Disneyland, Sam's Club shoppers, and members of AARP. They even offer cards for home mortgages and health savings accounts. If there's an affinity group or a usage occasion, it's a fair bet that a credit card is targeted to it.
When auto industry icon Bob Lutz was at Chrysler, he believed that it would be better to design cars that were at the top of the wish list of a quarter of the population than models that were somewhere down the list for everyone. On his watch, Chrysler developed the PT Cruiser, the Jeep Grand Cherokee, the popular Dodge Ram pickup, and the head-turning Dodge Viper. His strategy reinvigorated Chrysler and helped turn the company's fortunes around.
And then there's Ferrari, the ultimate ride for many sports car enthusiasts. After a particularly good sales year, the company made the strategic decision to reduce the number of cars it would allow dealers to sell. Ferrari chairman Luca di Montezemolo said of the decision, "Those who buy a Ferrari buy a dream, and they must be reassured that their dream of exclusivity will be fulfilled."
If it's true for soft drinks, credit cards, and automobiles, it can be true for your brand as well. If you narrow your focus to a key audience defined not merely by demographics but by lifestyle, attitudes, perceptions, behaviors, or anything else relevant to the purchase occasion, you may just make your brand an integral part of their lives.CHAPTER 3
HAPPY ARE THE HUNTED
SO HOW, EXACTLY, DOES A BRAND DEVELOP THE DEEP UNDERSTANDING of its target audience that lets it build equity like Buffalo Wild Wings or Mountain Dew? By first looking inward.
Tony Hsieh, founder and chief inspiration officer at Zappos, famously made the observation that Zappos isn't a shoe company, it's a customer service company that happens to sell shoes. And from the day he launched Zappos, Hsieh put his money where his mouth was, making ordering easy, returns hassle-free, and shunning industry conventions like tracking how quickly customer service representatives handle telephone inquiries. At Zappos, people who pick up the phone understand they're to spend all the time they need to delight those who place the calls.
Still, despite a great track record and growing reputation, from the get-go Zappos faced extreme competition from retailers (both online and off) that weren't going to cede their fans without a fight. The company was growing, but it knew it needed to do a better job communicating to shoe shoppers what its brand was about. But almost everyone buys shoes; how was Zappos to determine where to find its most likely prospective customers? How could the company find its version of "Dew Dudes"?
By studying some 900,000 of its most loyal customers, Zappos was able to develop a profile of what it came to call "Happy Hunters" who shared similar age, income, behavioral, and (most importantly) attitudinal characteristics. To Happy Hunters, time is more valuable than money, shopping online makes them feel more productive, and they place a premium on customer service. Zappos calculated that there were more than 7 million Happy Hunters as yet untapped by the brand. Now that's a target audience.
The company and its ad agency used that insight in the development of a multimedia campaign that further raised awareness of the brand, generated powerful results on key branding metrics, and kept the revenue curve sloping upward. Not coincidentally, Tony Hsieh shortly thereafter released his bestselling book, Delivering Happiness.
You may not have a million customer records to parse, but you can benefit from the same principle. No matter how big or small your brand, if you've been in business for any length of time, you must be doing something right. Somehow, some way, some customers found their way to your door and liked what you had to offer.
The best thing you can do to grow is to find out who they are and why your brand rings their bell. Then go about finding more of them. And unless your media budget is big enough that you've already reached everyone in the world, there are always more.
I once sat incredulous in a client's conference room when a research company told the brand managers that since they were doing well with x-type customers, they should now go after y-type customers. It was a crazy recommendation. Not only might x and y customer types be like oil and water (in this case, they were), it would be less efficient for the company to spend its resources and potentially dilute its brand pursuing two different targets (unless they're not really different after all, a topic we'll take up in the next chapter).
Every brand has its own Happy Hunters, however it defines them. If you haven't yet figured out who you want to pursue, take a look at who has pursued you. Sometimes love is right under your nose.CHAPTER 4
UNCOMMON IS COMMON
FINE, YOU SAY. MOUNTAIN DEW WAS ABLE TO IDENTIFY A NARROW target audience that would mainline caffeine if it could. And Zappos identified a single target profile with an untapped market of 7 million people. But my business isn't so simple. My brand has multiple target audiences to which it has to appeal.
No, it doesn't. In fact, it can't. Let me clarify with an example.
Almost 30 years ago, in his first radio recording session for Motel 6, humorist Tom Bodett ad-libbed a line that has gone down in advertising history: "We'll leave the light on for you." Those seven words encourage listeners to envision ways in which the folks at Motel 6 will welcome weary travelers, making sure the sheets are clean, rooms are safe, and whatever else they care to imagine.
The campaign has been wildly successful, earning more than 150 awards over its long run. It didn't hurt Tom Bodett's career either, who was building houses in 1986 when the Motel 6 call came — he was chosen, he says, because he sounded like the person who stays there.
Sounds simple, right? Just like Mountain Dew and Zappos, Motel 6 seems to have found a single, narrow target around which it built a great branding campaign. Not so fast.
The Richards Group, the Dallas-based advertising agency that originally developed the idea, faced a tough challenge when it got the Motel 6 assignment, as the chain's guests fell into three very different categories: seniors, vacationing families, and self-paying business travelers. How to make one motel chain appeal to old people on fixed incomes, harried parents with demanding kids, and haggard business travelers who just need a place to crash for the night — now that was a challenge.
But the agency didn't throw up its hands. Instead, applying the same principle Zappos would years later, it determined to look deeper into the psyches of the variety of Motel 6 customers and see if it could find something they had in common. Sure enough, despite their visible differences, Motel 6 customers all had a self-image of being frugal, which, according to an agency spokesperson, "represents the common denominator that predicts their behavior regardless of age, income, traveling purpose or any of a hundred other things that make each guest different."
Based on that realization, down-home radio personality Tom Bodett, who was able to relate to all types of Motel 6 guests, got his big break. Here's how, two decades later, he describes (with his now-legendary laconic humor) the brand's cross-target appeal:
Americans are generally very self-sufficient and I think generally averse to pretension just as I am. When you point out that you don't need to have art on your motel room walls because your eyes are closed anyway, or that you can take the money you save from not having avocado body balm in the bathroom swag basket and go buy some real chips and dip — avocado body balm, by the way, tastes just like soap — people respond. People feel vulnerable when they travel. Nobody wants to be taken advantage of or talked into something they don't want. Staying at Motel 6 makes you feel smarter.
That's a truth that can ring the bell of a variety of seemingly different audiences — be they senior citizens, families with children, or self-paying business travelers. None of them wants to feel vulnerable. All of them want to feel smart. That's how Motel 6 found its target.
That's not to say that no company has legitimately different target audiences that have little in common or even conflicting or contradictory needs. In that case, a single brand won't work. That's why Procter & Gamble makes several different brands of laundry detergent: Tide for superior cleaning, Dreft for sensitive baby skin, Gain for fragrance, Era for stain fighting, Cheer for color protection — you get the idea. Multiple needs, multiple targets, multiple brands. It's an effective — though expensive — approach to branding.
Fortunately, most companies don't have to go down the multi-brand road. More often than not, what your various target audiences have in common outweighs their differences; after all, at some level your value equation already adds up for each of them or you wouldn't consider them your target audiences.
I rarely stay in a Motel 6 because, based on my wants and needs, I'm not really who they're after. Nor do I fit the Mountain Dew profile in terms of my age or lifestyle. But that doesn't mean you'll never find me chugging a Dew or hoping the manager at Motel 6 leaves the light on for me. By focusing narrowly and increasing the intensity of their appeal, brands sometimes win the business of even people who don't fit the mold.
Excerpted from Power Branding by Steve McKee. Copyright © 2014 Steve McKee. Excerpted by permission of Palgrave Macmillan.
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