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My two key points here (saving you valuable blog reading time at NO extra charge!).
1. Branding is overrated and usually naively accepted as something that works for small business when generally it does NOT work.
2. Success has no recipe, rather it’s simply survival of the best of many, mostly failed experiments. Predicting which will survive is very hard to do, and successful business models evolve from movements aways from troubles as much as “towards” success or using some recipe for success.
A open bet I have that is the extension of point 2 comes to mind:
I’ll wager $1,000 (or more if you like) against *anybody* who says they can predict the movement of any publicly traded stock or index 2 days in a row. ie you’d have FOUR options “up or down” each for day one and day two. Note: This is a bad bet for you – you’ll lose it about 3/4 of the time. Yes, YOU will!
———– the rest of the story ————
As I age gracefully within the business world I see/meet/study a lot of “success stories” as well as failures. Contrary to the fairy tale notions of success, I would not say that successful people seem to be all that much a result of “hard work” or “brilliancy” or “following a path to success”. I’m not saying there’s zero relationship between smart people or hard workers and success – there does indeed seem to be correlation and I’d guess causation. However the best way to understand success is to look at the paths away from failures rather than to try to apply a bunch of “success rules” that are mostly just talk-fodder for marketeers and motivational speakers. In fact many mega-success stories are notable more for how they defied rules than how they applied them.
In the “special” report from American Express I just got in the mail they have noted “Six Branding Strategies that can help Differentiate Your Business” . The advice is generally fine for those who believe in branding as the key strategic concern in small business marketing. I’m a marketing heretic in this respect and remain very skeptical of the whole branding concept with the probably exception of the huge companies that sell national or international products, are marketing to pretty much “everybody”, and have a fairly high potential profit margin on your products (e.g. Coke, ATT, SONY).
Brand may matter at a national level to some extent but even for the big ticket companies I think the ad campaigns are as much about making money for marketing firms as all this “top of mind” stuff that in my view is questionably supported by a lot of self-serving research. Seems to me that most of the global brands are more a product of the company’s early efforts than the campaigns that followed those efforts. It’s hard to tell the primacy of the branding chicken from her egg over time, but clearly Google is an example of a huge global brand which was well known well before any expensive advertising campaigns came along to spread and reinforce the message. Are they the exception or the branding rule?
Branding or not, the American Express advice in a nutshell is OK for the brandy dancers* out there. The recommendations are:
* Perform Background Research
* Define Your Brand
* Ensure Consistency
* Tap Social Networking Tools
* Track Your Performance
* Stay Top of Mind
Well, OK, but I’d recommend to most small businesses that they focus on only two of these nuggets – Social Networking and tracking performance, and most importantly that they be sure to work away from failure. If an ad campaign is not returning positive ROI then dump it – NOW – and find things that do return a positive ROI. Social networking is essentially free. To some extent time is money, but generally this is a great way to apply yourself as the key player in your business and to adjust things at low cost with potential high return. *Every* business should have a website and a Twitter account. NO exceptions to this unless you are a clandestine operative for the CIA or something like that. I suppose Twitter isn’t a great idea in that case. “Clandestine CIA Operative for Hire – Please twitter @SecretsoftheCIA“. From a small restaurant to a mega-corporation, you need to have a path from you to customers and from them to you. Twitter is hard to beat for that purpose.
Based on my travel sector experiences I would argue that local and regional branding is very much overrated as a concept, mostly by the entities (marketing folks) who profit from the misperception that you can usually attain positive ROI on branding campaigns.
Incredibly much of the research in this area is by entities that …. drum roll please …. wait for it …. make their living promoting the idea that branding works. It’s no surprise that a firm hired by agencies to “determine” whether they are effective at something … winds up finding out that …. they are effective at doing something! As with evolution, you don’t survive long if your research tends to conclude your client isn’t doing their job very well.
“I’m sorry Mr. Honest Marketing Research Firm who concluded we waste our money, we’ve concluded we need a new research firm”.
* Brandy Dancers are branding enthusiasts and are not to be confused with the Gandy Dancers who use to lay rail in the USA in the 1800s.
Disclaimer: As a Techdirt Insight Community writer I am sometimes paid for American Express project writing over at InsightCommunity.com This post has nothing to do with that and no compensation is expected or implied, and reflects only my views and the views of those who agree with me. You know who you are, and I thank you for reading so far into this disclaimer. For more about potential conflicts of interest as well as a treatise on the notion that transparency and disclosure are more important than the usual pretense of ” I am unbiased!”, see our dislosure policy over at Technology Report. This ends the disclosure disclaimer portion of our program, thank you and good night.
Ha – almost 50 comments on the Climate email hack, zero here. Maybe I should just go into the climate blog biz…. 😆
Actually Joe all you need to do is making something up. Create some bogus findings, hide the truth, demonize anyone who doesn’t believe you, get the UN to support you, get billions in funding and enslave the world!!!
Woo hoo…before you know it you are the next Dr. Evil!!!
1 million dollars!!!
So what I hear you saying is that it is 99% perspiration, and 1% inspiration.
Good, solid advice here! Thanks!
In regard to your bet…if the market were working as expected you might have a better chance at “guessing”. Unless you know someone on the White House or high up in GS…you don’t have a chance. PT Barnum would have some choice words for your bet.
You are right about branding, branding mattered when you had to go to a “store” or shopping “blind” and you remembered the brand to buy not the performance of the product which you can now read anywhere anytime from consumer comments on literally everything.
Glenn, you single out GS…but what about the countless instances of insider trading done on the basis of material non-public information?
Joe, you’re on the money. A great businessman once told me: “Fail quickly, fail cheaply.”
You mean like making 6 figures off a future trade with Tyson foods? 🙂
Branding? Not quite sure what this very au courant buzzword actually means. I’ve used the example of fickle consumers being “loyal” to a particular glitzy restaurant or nightclub only until the next trendy news item sends them elsewhere. Brand identity? Brand loyalty? Nope!
I think the computer revolution pretty much showed most people shop largely on price, speed and reliability.
When I found out too late that the airline had changed the departure gate, my hotel selection was based only marginally on its name, the deciding factor was location in relation to the airport and shuttle availability.
Booze? I order Scotch. I don’t specify a particular brand.
Restaurant? Determinant is geography, not brand names.
FoolsGold you have described my general approach as well, which is one of the reasons I’m skeptical of the mega-expense of “branding” campaigns, especially for new things that can even more easily fall victim to fickle consumer preferences.
Branding is probably built more on hype than anything else.
A brand name, a logo, a well-known packaging design each add not one whit of value to the product except perhaps in the mind of the unalert consumer.
Consider Liquid Laundry Bleach. Its a 5.25 percent aqueous solution of sodium hypochlorite no matter what cutesy name you give it. Does endowing it with some “identity” and conducting an advertising campaign about non-existent superior features really provide some sort of return on the investment? Its liquid laundry bleach. Its a commodity.
Only the utterly ignorant would think the cutesy name and glowing adjectives mean anything at all. Do consumers really think that an actress in a tv commercial singing about her laundry bleach is really experiencing great joy and bliss due to the unique name on the lable? She is a professional actress and in order to be filmed gleefully singing and dancing around her laundryroom she has to imagine the washer and dryer to be male exotic dancers clamoring for her favors.
What possible gain is there to branding in such a situation?
The consumer is being lured into the belief that some significant points exist. In other consumer situations its possible to exploit vague aspects. Everyone has had good and bad experiences in hotels. Everyone has had great meals and rather bland meals in the same restaurant at one time or another. Create some Customer Satisfaction Index and you can try to create an illusion of measurable differences but in reality all the variable enjoyment aspects have not been changed one bit.
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