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Competitive Brand Strategy

At Beloved Brands, we always start with the consumer so that we ensure we are meeting the needs of consumers rather than blindly putting things out into the marketplace that no one wants. However, the second check is the competitive nature of your positioning to make sure I’m not blindly putting things out that someone is already doing. Murder and Strategy have one thing in common, they both start with opportunity. There is talk this week of Apple getting into the car business. Yes, I’ll await with excited breath at what it looks and feels like–I can predict that it will carry stylish designs, take every car technology and make it simple enough for everyone to use and provide top of the line quality in workmanship. It will come at a significant premium. Wait a second, it’s a Mercedes. Apple has only done well in categories where technology geeks can’t see straight enough to simplify their product enough for the average person to buy it. Apple has won by offering simplicity in the face of frustration. Yes, there is frustration with Chevrolet and Chrysler but Apple won’t be priced in the Chevy range. That’s not the case with Mercedes. 

Brands have four choices:  better, different, cheaper of not around for long

The key is to find a unique selling proposition for your brand.  You don’t always need to find a rational point of difference as long as there is room to be emotionally unique.

Slide04Map out everything your consumer wants–all the possible need states. Then map out all the benefits that you and your competitors can do better than anyone else–both functional and emotional zones.  You want to find that intersecting zone where what you can do best matches up to a need state of the consumer.  Then find a way to serve that need state to the best of your ability and transform it into an even bigger deal than first meets the eye. Avoid the intersecting zone where your competitor is better than you and please avoid that zone where you and your competition foolishly battle in an area that “no one cares” about.   The battle ground zone is where both you and your competition can satisfy the consumer need at an equal rate.  To win in this situation, you need to get creative and find ways to out-execute or find some emotional connection that changes the game and makes you the clear winner.

Competitive Warfare

At the start of any strategy definition, you should ask “where are we?” Here are four questions to be asking that force you to choose four possible solutions to each.

  1. What is your current share position in the market?
  2. What is the core strength that your brand can win on?
  3. How tightly connected is your consumer to your brand?
  4. What is the current business situation that your brand faces?

This article focuses on question one which speaks to where you rank in the market, which a great indicator of how much power you can command in the market.  You have four choices, using Marketing Warfare (Trout and Ries) you are either the Leader, Challenger, Niche or a Guerilla.

  • Leader (defensive): Leader of category or sub-category defending their territory by attacking itself or even attacking back at an aggressive competitor.
  • Challenger (offensive): Challenger’s attack on the leader to exploit a weakness or build on your own strength.
  • Flanking: An attack in an open area where the Leader is not that well established.
  • Guerrilla (Niche): Go to an area where it’s too small for the Leaders to take notice or are unable to attack back.

The leader uses defensive strategies

Defensive strategies should be pursued by the leader. Not only the market share leader, but the perceived leader in the consumers’ mind. Attacking yourself is the best defense. Identify and close leaks in service, experience or products. Introduce new products superior to your current. Challenge the culture to step it up to continually get better and stay ahead of the competitors. Can’t be complacent or you’ll die. The Leader blocks all offensive moves. Keep an eye on your competitors moves—and adjust your own brand to ensure you defend against their attacks. Attack back with an even greater force than the one attacking you. Demonstrate your brand power. Leverage all the brand power you’ve mustered to maintain your positional power.Slide1

The challenger brand uses offensive strategies

The best offensive attack is to actually find weakness within the Leader’s strengths. Turn a perceived strength around is very powerful. Attack a weakness might be insufficient. Be careful of the Leader’s Defensive moves. Anticipate a response with full force—possibly even greater than yours. Avoid wars that drain resources and hold same share after the war. Attack on as narrow of a front as possible to ensure your resources are put to that area—which might be more force than the leader puts to that one area. Narrow attacks are effective when the leader tries to be all things to all people—enabling you to slice off a part of their business before they can defend it. Leapfrog Strategy, technology and business models are game-changers in the category.

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The flanker brand stays clear of any battles

The flanker strategies go to uncontested areas, in the safety where the leader is not competing. Make sure you are the first in this area. Speed and surprise can help win the uncontested area before the Leaders take notice. Make your move quickly and stealthfully. Follow through matters, to defend the area you’ve won. Others may follow—whether it’s the leader trying to use their might or copy cats looking for an early win. You can win with new targets, price points (premium or value), distribution channels, format or positioning. Flanking, while lower risk of attack from the leader, is a higher risk with consumers because innovation is always riskier because consumers might not like the concept.

Guerrilla warfare wins where no one notices or cares

Pick a segment small enough that it won’t be noticed and you’ll be able to defend it. Be aggressive. Put all your resources against this small area, so that you’ll have the relative force of a major player. Be flexible and nimble. You’ll need to enter quickly to seize an opportunity that others aren’t noticing, but also be ready to exit if need be—whether the consumers change their minds or competitors see an opportunity to enter. Explore non-traditional marketing techniques to get your brand message out and your brand into the market quickly. Because you’re playing in a non-traditional market, you’ll be given leeway on the tools you use. For Guerrilla brands, it is better to be loved by the few, than liked or tolerated by many.

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Marketing Warfare Rules for Success

  1. Speed of attack matters. Surprise attacks, but sustained speed in the market is a competitive advantage.
  2. Be organized and efficient in your management. To operate at a higher degree of speed, ensure that surprise attacks work without flaw, be mobile enough.
  3. Focus all your resources to appear bigger and stronger than you are. Focus on the target most likely to quickly act, focus on the messaging most likely to motivate and focus on areas you can win.   Drawn out dog fights slows down brand growth. Never fight two wars at once.
  4. Use early wins to keep momentum going and gain quick positional power you can maintain and defend counter-attacks.
  5. Execution matters. Quick breakthrough requires creativity in your approach and quality in execution.
  6. Expect the unexpected. Think it through thoroughly. Map out potential responses by competitors.

Use competitive strategy to find your point of difference

Bringing our blog to life through video

000f51eAt Beloved Brands, we have created a new video Series called BELOVED BRANDS 180. Each video will be 180 seconds (3 minutes) in length and our goal is to get Brand Leaders to do a 180 on their thinking. We want them to think different, because the thinking that got you this far, might not be enough to get to where you want to go next. Today’s video topic is “How to write a brand positioning statement”. Brand positioning statements provide the most useful function of taking everything you know about your brand, everything that could be said about the consumer and making choices to pick one target that you’ll serve and one brand promise you will stand behind.  While we think this brand positioning statement sets up the creative brief, it should really set up everything the brand does–equally important for internal as everyone should follow to what the positioning statement says.  

At Beloved Brands, we love to see Brand Leaders reach their full potential.  Here are the most popular article “How to” articles.  We can offer specific training programs dedicated to each topic.  Click on any of these most read articles:

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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How to lead the brand planning process

As Yogi Berra once said “if you don’t know where you’re going, you might not get there.”

The same could be said about brands, who try to execute blindly without knowing where they are going. From what we see, the best executed brands are also the best planned brands. Strategy is about focusing, by applying your limited resources of investment, time and people against an unlimited array of choices. You must narrow your focus to get the highest payback against what you put in.

The Beloved Brands planning process includes four key phases: 1) Deep-dive business review 2) Key issues 3) Brand positioning and 4) Brand plan

Stage 1: The deep-dive business Review 

We provide brand leaders with a full range of analytical tools to look at every part of the brand, providing a complete review for management. We teach brand leaders good analytical principles about telling stories with facts to gain more support for your analysis. We look at every part of the health and wealth of a brand looking at the category, consumer, channels, brand, competitors. Slide05We teach how analysis turns fact into insight and how data breaks set up strategic choices. We look at how to turn analytical thinking into projections. And then we help to build an analytical story and presentation that’s ready for management review.

To read our presentation on Analytics, click on this PowerPoint:

A typical agenda for a business review should consist of:

  • Category: factors impacting growth, trends, economic, changes happening in demographics, behaviors, consumption. Look at related categories.
  • Consumer: define segments, buying habits, growth trends, key insights for each segment, buying system analysis, leaky bucket, consumer perceptions through tracking data and research.
  • Channels: look at each channel’s performance, major customers, sales performance, tools for winning used in each channel.
  • Competitors: dissect competitors looking at positioning, pipeline, pricing, distribution differences, consumer perception, strategies. Complete a brand plan for each competitor.
  • Brand: look at internal and external health and wealth of brand. Use financial analysis, brand funnel data, market research perceptions. Look at advertising results, pricing strategies, distribution gaps and do a complete leaky bucket analysis.

To read how to conduct a business review, click on this hyper link: How to lead a Business Review on your brand

One model we use to summarize where your brand stands is to ask four key questions:

  1. What is your current share position in the market?
  2. What is the core strength that your brand can win on?
  3. How tightly connected is your consumer to your brand?
  4. What is the current business situation that your brand faces?

For each of those four questions, we offer four possible answers to help narrow where you are, using the model below:  

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To read the connected story and more depth on this model, follow this hyperlink: Challenge your thinking to focus your brand strategy

Stage 2: The key issues 

We coach brand leaders on how to frame the most important strategic questions that set up their strategic brand plans. We leverage the summation of the business review to frame the drivers, inhibitors, risks and opportunities. From there we set a “straw dog” brand vision, then brainstorm all the issues getting in the way of achieving that brand vision. We begin to see key issues themes and use strategic summation tools to make sure we’ve looked at all parts of the business. We coach on the writing of a key issues deck for management approval. A typical agenda for a key issues presentation would look like:

  • Health and wealth of brand: look factors driving the internal health and wealth and the external health and wealth of the brand.
  • What’s driving growth and how will we continue to enhance? Stay focused on things going right, accelerate against them. Continuous improvement.
  • What’s inhibiting growth and how will we minimize or reverse? Close the leaks, develop turnaround plans or re-focus the team against the trend.
  • What opportunities for growth will we take advantage of? Build plans to mobilize the brand to see if the opportunity is a winning space for the brand.
  • What are the risks to future growth to avoid and what are the Contingency plans? Identify and measure the risk, explore plans to avoid.   Fill the gap before a competitor.

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We believe brand leaders should spend more time on asking great strategic questions, believing that the thinking you put into those questions will help frame better strategy choices. Here’s a story on that subject: Strategic thinkers see questions, before they see answers. Non-strategic thinkers see answers before questions.

Stage 3: Create a winning brand positioning

We coach brand leaders on creating a brand idea and brand positioning that will help your brand win in the market. We use a workshop style process that helps your team find a winning brand positioning, pushing the emotional benefits. We can validate with consumers through a testable brand concept. We’ll work to create a Big Idea that frames the external and internal promise of your brand. We’ll leave you with an execution ready creative brief to hand to your agency. You should revisit the positioning each year, matched up to the consumer insights of your business review as well as your competitive review to make sure that you’re winning in the marketplace. A typical agenda for brand positioning would be: 

  • Who do we want to sell to? (Target Market): Who do we want to sell to? Segmentation performance, broken out by demographics, psychographics, buying patterns. Use consumer insights to tell story based on category insights and think about Life Insights or even Societal Trends that could impact changing consumer behavior. Define the consumer enemy.Slide09
  • What are we selling?  (main Benefit) and why should they believe us?  (Reason To Believe) Using a Customer Value Proposition Ladder: Define consumer target: need states, enemies and insights. Product features: Product-focused strengths, claims, differences or unique offerings. Rational benefits: In consumer’s voice, answer, “so, what do I get?” Emotional benefits: Look at rational benefit, asking, “so how does that make me feel?” using emotional Cheat Sheet belowSlide10
  • And then to execute that positioning in the market place, ask: what do we want the Advertising to do for the brand?  (Strategic Choices) Where your Brand sits on the Brand Love Curve sets up your Strategic Choices. When Indifferent, you want to establish your brand in the mind of consumers so that you can drive awareness and consideration with new user. At Like It, you should create following by separating yourself and drive the rational & emotional benefits to close sale. When at Love It stage, you want to tug at the Heart and tighten the connection using emotion. When Beloved, you need to continue the magic and maintain the love with your most loyal users
  • What do want people to think, feel or do?  (Desired Response): Use a Buying System to focus your Advertising Strategy and how you’ll use your Media options
  • What’s the long-range feeling the brand evokes (The Big Idea): The big idea connects with the consumer and guide the promise, strategy, story, Innovation & Culture.

To read more on how to write a brand positioning statement, follow this hyperlink: How to write a winning Brand Positioning Statement

Stage 4: Write a brand plan everyone can follow

We coach brand leaders to build highly focused strategic brand plans that everyone in your organization can follow. We use a workshop style process to help your team lay out a long-range strategic road map and brand plan that everyone in your organization can follow. We’ll help your team prepare brand plans for review. We then work with your team to create actionable project plans for each tactic with goals, milestones and budget. A typical agenda for a one-year brand plan would include: 

  • Vision: What do you want your brand to be in the next 5-10 years? Vision gives everyone on the brand a clear direction, it should be measurable (quantitative) and motivating (qualitative). It should push you so much that it scares you a little, but excites you a lot.
  • Purpose: Why does your brand exist? Keep asking yourself why you do this, to find the personal motivation hidden in the brand. Articulating your purpose can be a very powerful way to connect with both employees and consumers, giving your brand a soul.
  • Goals: What do you need to achieve? Specific measures of brand health and wealth, related to consumer/customer behavioral changes, metrics of key programs, performance targets or milestones on the pathway to the vision. It’s the brand scoreboard.
  • Financial Forecasts: sales, A&P spending, margins, profits, market share.
  • Key Issues: What is getting the way from achieving your vision/goals? Deep analysis highlights what’s driving and holding brand back, as well as future risks and untapped opportunities. Issues are asked as a question to provide the problem to which strategies become the solution.
  • Strategies: How can we get there? Strategies are the “How” you will win the market. Choices based on market opportunities, using consumers, competitors or situational. Strategies should have a pin-pointed focus providing a breakthrough on the pathway to the brand vision.
  • Tactics: What do we need to do to execute the strategy? Framed completely by strategy, tactical choices deploy your limited resources against brand projects in the most efficient way to drive a high ROI.
  • Marketing Budget to achieve Results: broken out by trade spend, communication, consumer promo, new products, research.

We take all this information and put it on a Plan on a Page, outlined below:

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The best run brands spend the time needed to plan things out. Many brands who try to cut corners on the planning process end up with confused or random execution–sometimes working, sometimes not. Every brand is constrained by resources–no brand has enough money, time or people to execute everything they want to do. The best brand leaders make choices and use the word “or” as they force choices, rather than “and” as they try to do everything. Focus makes you matter most to those who care the most. Don’t blindly target consumers:  target the most motivated.  Focusing your limited resources on those consumers with the highest motivation and  propensity to buy what you are selling will deliver the highest return on investment. In a competitive category, no one brand can do it all: brands must be better, different or cheaper to survive. Giving the consumer too many messages will confuse them as to what makes your brand unique. Trying to be everything to everyone is the recipe for being nothing to anyone. Return on Effort (ROE) is a great tool for focusing your activity. Doing a laundry list of activity spreads your resources so thin that everything you do is “ok” and nothing is “great”.And in a crowded and fast economy, “ok” never breaks through enough to get the early win and find that tipping point to open up the gateway to even bigger success. Here are the benefits to the Brand by focusing your efforts: 

Better Return on Investment (ROI): With all the resources against one strategy, one target, one message, you’ll be able to move consumers enough to drive sales or push other key performance indicators in the right direction.

Better Return on Effort (ROE): It’s about getting more back than you put into the effort. Working smart helps make the most out of your people resources.

Stronger Reputation: When you only do one thing, you naturally start to become associated with that one thing—externally and even internally.  Reputation is a power you can push to find deeper wins.

More Competitive: As your reputation grows, you begin to own that one thing and you can better defend that positioning territory. You can expose the weakness of your competitors, attract new consumers as well as push internally (R&D, service, sales) to rally behind the newly created reputation.

Bigger and Better P&L: As the focused effort drives results, it opens up the P&L with higher sales and profits. People with money invest where they see return.

Video workshop on leading the planning process

000f51eAt Beloved Brands, we have created a new video Series called BELOVED BRANDS 180. Each video will be 180 seconds (3 minutes) in length and our goal is to get Brand Leaders to do a 180 on their thinking. We want them to think different, because the thinking that got you this far, might not be enough to get to where you want to go next. Today’s video topic is Mapping out the annual brand planning process. Our Beloved Brands process takes you through all 4 phases of planning: 1) Deep-dive business review 2) Key issues 3) Brand positioning and 4) Brand plan 

Everything you’ve just read is summed up in a 3 minute video. 

To see all this come together in a presentation format, follow the PowerPoint presentation below:

If you need help with your planning process, feel free to contact us to help get your team moving in the right direction. 

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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Personal Branding: How to create your own brand plan

Slide1If you’ve ever been in a job so long that you don’t have an updated resume or Linked In profile, you’re in a dangerous place. In today’s economy, you want to stay aware, keep current and always be on the look out for what’s next. As we push the personal branding, you should be able to articulate your own brand in 7 seconds, 60 seconds and 30 minutes, all shaping and telling the same story. Start off your next interview with a 7 second pitch that describes yourself (e.g. I’m a marketer that finds growth where others can’t), follow that with a 60 second articulation of what that means, and use the rest of the interview to layer in the elements of your 30 minute story. 

Finding your Big Idea

Everyone talks about the 7 second elevator pitch, but it’s not easy to get there. I suppose you could ride up and down the elevator and try telling people. That may drive you insane. The Big Idea (some call it the Brand Essence) is the most concise definition of the Brand. For Volvo, it’s “Safety”, while BMW might be “Performance” and Mercedes is “Luxury”. Below is the Tool I use to figure out a Brand’s Big Idea revolving around four areas that help define the Brand 1) Brand’s personality 2) Products and Services the brand provides 3) Internal Beacons that people internally rally around when thinking about the brand and 4) Consumer Views of the Brand.  What we normally do is brainstorm 3-4 words in each of the four sections and then looking collectively begin to frame the Brand’s Big Idea with a few words or a phrase to which the brand can stand behind.

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Once you have your Big Idea, you should then use it to frame the 5 different connectors needed to set up a very strong bond between your brand and your consumers.

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Creating a Personal Brand Plan

You need to build a Brand Plan that focuses your efforts in the market place. Use a traditional brand plan format, to include vision, purpose, values, goals, issues, strategies and tactics to create a plan. Here are some definitions to help trigger your thinking.

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And now when you bring these two documents together you can create your own personal Brand Plan on one page. Below is my document that we use for our “Beloved Brands” personal brand. You should try this out using your own brand and you’ll use the strategies to focus your tactical efforts.

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Manage your personal brand as though you would the brand you work on

To read more about personal branding, here’s a few more articles to trigger your interest. Click on the title to read the story:

Managing Your Career: Finding and using your Core Strength as a Brand Leader

Tools to help you describe your brand in 7 seconds, 60 seconds and 30 minutes

5 Crucial Career Questions to Ask yourself in the most honest soul-searching start to what’s next

And here’s a link to our Beloved Brands presentation on personal branding:

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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How to lead a Business Review on your brand

2015 logo profile pic versionBefore engaging in your brand planning process, it is a good discipline to start off by doing a deep dive analysis on everything on your business. And I mean everything.  

Yes, everything!!!

When I was at J&J, we had the luxury of getting our Assistant Brand Managers (ABM) to spend 6 weeks looking at everything on the brand and then getting them to present it to the marketing leadership team. Here’s a little secret: it sounds a little cruel, but we hinted that the business review was a “bit of a test” that would impact your career trajectory. If you give an A-type personality from the best MBA programs a month to dig in and you hint that it’s a “test”, you get some of the best brand reviews ever!  These ABMs also spent a full day each month digging into the monthly consumption and sales numbers and writing up a monthly report which helped keep us on track all year. When I became a Brand Manager, I said “thank god I’m no longer have to do all that analysis, and I can now spend more time just thinking”. But as I moved up to Director level and up to the VP level, I started to lose touch with what was really happening on the brands. So, rather than just pass on the ABM’s monthly report to my boss, I would block off a morning and do up my own monthly report. I dug in on the share data, looking for breaking points in the trend line, questioning any splits I would see after breaking out the regions, channels or sizes. Many times, I’d come up with new conclusions not considered and I’d pass them back down. With that analytical training as an ABM matched up against my experience, I found I could go faster than I used to–because I knew what to look for.

The lesson I learned, is that to free yourself up to do the thinking, you need to first dig in and do the questioning. 

As Abraham Lincoln said, “Give me six hours to chop down a tree, and I will spend the first four sharpening the axe”

At Beloved Brands, we believe in digging deep and we live the six principles for good analytics: 

  1. Opinions without fact to back them up are just opinions and can leave a room divided:  you will gain more support for your analysis by telling analytical stories through data.
  2. Absolute numbers by themselves are useless: only when given a relative nature to something important do you find the data break that tells a story. Slide1
  3. The analytical story comes to life when you see a break in the data: comparative indexes and cross tabulations can really bring out the data breaks and gaps that can really tell a story. 
  4. Like an old-school reporter, two sources of data help frame the story: Avoid taking one piece of data and making it the basis of your entire brand strategy. Make sure it’s a real trend.
  5. Deep analysis requires thinking time:  Asking these 5 questions can force the deeper richer thinking: What do we know? What do we assume?  What we think? What do we need to find out? What are we going to do? 
  6. Use tools that can help organize and force deep dive thinking in key areas:  SWOTs or Force Field type tools help organize your thinking and frame the discussion for others.

Deep Dive Business Review

  1. Category: factors impacting growth, trends, economic, changes happening in demographics, behaviors, consumption. Look at related categories.
  2. Consumer: define segments, buying habits, growth trends, key insights for each segment, buying system analysis, leaky bucket, consumer perceptions through tracking data and research
  3. Channels: look at each channel’s performance, major customers, sales performance, tools for winning used in each channel
  4. Competitors: dissect competitors looking at positioning, pipeline, pricing, distribution differences, consumer perception, strategies. Complete a brand plan for each competitor.
  5. Brand: look at internal and external health and wealth of brand. Use financial analysis, brand funnel data, market research perceptions. Look at advertising results, pricing strategies, distribution gaps and do a complete leaky bucket analysis.
  6. Health and Wealth of Brand: look at factors driving the internal health and wealth and the external health and wealth of the brand.
  7. What’s driving growth: summation of the top 3 factors of strength, positional power or inertia that can be a proven link to growth.
  8. What’s inhibiting growth: summation of top 3 factors of weakness, un-addressed gaps or friction holding back the growth of the brand.
  9. Opportunities for growth: specific untapped areas that would fuel future growth, based on unfulfilled needs, new technologies, regulation changes, removal of trade barriers.
  10. Risk to future growth: changing circumstances create potential risk to your growth pattern, based on changes in consumer needs, threat of substitutes, barriers to trade, customer preference, or attacking your weaknesses

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At Beloved Brands we teach brand leaders good analytical principles about telling stories with data to gain more support for your analysis. We look at every part of the health and wealth of a brand looking at the category, consumer, channels, brand, competitors. We teach how analysis turns fact into insight and how data breaks set up strategic choices. We look at how to turn analytical thinking into projections. And then we help to build an analytical story and presentation that’s ready for management review.

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Here is the Workshop that we run to help brand leaders be better at analytical thinking and help them to create better analytical stories. You’ll see how we are able to dig into every aspect of the brand as we provide tools for assessing the overall category to dissecting the competitor, how to analyze what’s happening with consumers and channels and then how to do a complete assessment behind the data of the brand. You have all this information, you should really use it.

       

In a world of BIG DATA, it’s only BIG if you know how to use it.

At Beloved Brands, we love to see Brand Leaders reach their full potential.  Here are the most popular article “How to” articles.  We can offer specific training programs dedicated to each topic.  Click on any of these most read articles:

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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Bringing our blog to life through video

000f51eAt Beloved Brands, we have created a new video Series called BELOVED BRANDS 180. Each video will be 180 seconds (3 minutes) in length and our goal is to get Brand Leaders to do a 180 on their thinking. We want them to think different, because the thinking that got you this far, might not be enough to get to where you want to go next. Today’s video topic is “How to write a brand positioning statement”. Brand positioning statements provide the most useful function of taking everything you know about your brand, everything that could be said about the consumer and making choices to pick one target that you’ll serve and one brand promise you will stand behind.

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Video on “How to write a winning brand positioning statement”

Bringing our blog to life through video

000f51eAt Beloved Brands, we have created a new video Series called BELOVED BRANDS 180. Each video will be 180 seconds (3 minutes) in length and our goal is to get Brand Leaders to do a 180 on their thinking. We want them to think different, because the thinking that got you this far, might not be enough to get to where you want to go next. Today’s video topic is “How to write a brand positioning statement”. Brand positioning statements provide the most useful function of taking everything you know about your brand, everything that could be said about the consumer and making choices to pick one target that you’ll serve and one brand promise you will stand behind.  While we think this brand positioning statement sets up the creative brief, it should really set up everything the brand does–equally important for internal as everyone should follow to what the positioning statement says.

 

Finding your uniqueness

Brands are either better, different or cheaper.  Or not around for very long.  The key is to find a unique selling proposition for your brand.  You don’t always need to find a rational point of difference as long as there is room to be emotionally unique.  

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Map out everything your consumer wants–all the possible need states. Then map out all the benefits that you and your competitors can do better than anyone else–both functional and emotional zones.  You want to find that intersecting zone where what you can do best matches up to a need state of the consumer.   Then find a way to serve that need state to the best of your ability and transform it into an even bigger deal than first meets the eye.   Avoid the intersecting zone where your competitor is better than you and please avoid that zone where you and your competition foolishly battle in an area that “no one cares” about.   The battle ground  zone is where both you and your competition can satisfy the consumer need at an equal rate.  To win in this situation, you need to get creative and find ways to out-execute or find some emotional connection that changes the game and makes you the clear winner.  

The Brand Positioning Statement

A best in class positioning statement has four key elements: 

      • Target Market (a)
      • Definition of the market you play in (b)
      • Brand Promise (emotional or rational benefit) (c)
      • The Reason to Believe (RTB) the brand promise (d)

The more focused your decisions, the more successful you will be: decide on one target, one promise and maybe  one or two reasons to believe that help to directly back up your promise.  But the target shouldn’t be everyone 18-65, and don’t throw your eight best features at the wall and hopefully something sticks.  And the reason to believe has to back up your promise, not be a whole new promise.

The classic way to write a Brand Positioning Statement is to take the elements above and frame them into the following:  For the target market (a) Brand X plays in the market (b) and it gives the main benefit (c). That’s because of the following reasons to believe (d).  This is what it looks like when you put them into this format:   

Slide11Looking at the example above for Gray’s Cookies (fictional brand), the target is proactive preventers, who want to do everything for their health, including sacrificing what they eat.  That’s all about a consumer that wants control. The main benefit is guilt free control, with the balance of taste and health in the cookie.

The biggest thing you have to do is make tough decisions.  Find the target of those you can get to love you, rather than trying to sell to everyone that might one day like you.   Match up your benefits to the need states of the consumer.  And leverage where you are on the Love Curve to determine how much emotion you are able to build into your Brand Positioning Statement.

Who is Your Target?

Beloved Brands know who their customer is and who it is not.  Everything starts and ends with the Consumer in mind.  Spreading your limited resources across an entire population is cost prohibitive–low return on investment and low return on effort.  While targeting everyone “just in case” might feel safe at first, it’s actually less safe because you never get to see the full impact.  Realizing not everyone can like you is the first step to focusing all your attention on those that can love you.  It becomes all about choices and you will be much more effective at convincing a segment of the population to choose your brand because of the assets and promise that you have that match up perfectly to what they want.Slide06

To demonstrate knowledge of that target, defining consumer insights help to crystallize and bring to life the consumer you are targeting. The dictionary definition of the word Insight is“seeing below the surface”.   Too many people think data, trends and facts are insights.  Facts are merely on the surface—so they miss out on the depth–you need to bring those facts to life by going below the surface and transforming the facts into insights.

When insight is done right, it is what first connects us to the brand, because we see ourselves in the story.  Insight is not something that consumers didn’t know before.  It’s not data or fact about your brand that you want to tell.   That would be knowledge not insight.   Insight is something that everyone already knows and comes to life when it’s told in such a captivating way that makes consumers stop and say “hmm, I thought I was the only who felt like that”.  That’s why we laugh when we see insight projected with humor, why we get goose bumps when insight is projected with inspiration and why we cry when the insight comes alive through real-life drama.  

What’s the Benefit?

The next decision is the main benefit you want to focus on.  Doing a Customer Value Proposition (CVP) helps to organize your thinking as a great tool for bringing the benefits to life.  

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Hold a brainstorming session with everyone who works on the brand so you can:

    1. Get all of the consumer insights and need states out.  
    2. Match them up against the list of the best features the brand offers.  
    3. Find the rational benefit by putting yourself in the shoes of the consumer and seeing the brand features from their eyes: start asking yourself over and over again “so if I’m the consumer, what do I get from that?”. Ask it five times and you’ll see the answers will get richer and richer each time you ask.  
    4. Then find the emotional benefit by asking “so how does that make me feel?”  Ask that five times as well, and you’ll begin to see a deeper emotional space you can play in and own.   

Some CVPs can end up very cluttered, but the more focused you can make it the easier it will be for you to choose which one you will stand behind, and which one benefit you’ll communicate.  Slide1That’s right: JUST ONE BENEFIT!  Agencies use so many tricks to get it down to the ONE THING.  Examples of this could be a postcard or a bumper sticker, or silly questions like “what would you say to get someone to marry you” or say in an elevator. My favourite is to get people to stand up on a chair and “SHOUT FROM THE MOUNTAIN” what your benefit is.  It forces you to want to scream just ONE THING about your brand—keep it simple.  You can’t scream a long sentence.  And if you are into math, another way to look at this is through a simple function, where the probability of success (P) is directly linked to the inverse of the numbers of messages (M) you have in your ad:   P = 1 divided by 1 to the power of M.  My guess is that if you find this last formula motivating, maybe marketing isn’t for you.

Emotional Benefits

People tend to get stuck when trying to figure out the emotional benefits.  I swear every brand out there thinks it is trusted, reliable and yet likeable.  It seems that not only do consumers have a hard time expressing their emotions about a brand, but so do Brand Managers.   Companies like Hotspex have mapped out all the emotional zones for consumers.   I’m not a researcher, but if you’re interested in this methodology contact Hotspex at http://www.hotspex.biz  Leverage this type of research and build your story around the emotions that best fit your consumer needs.  Leveraging Hotspex, I’ve mapped out 8 zones in a simplistic way below. Within each of the zones, you can find emotional words that closely align to the need state of the consumer and begin building the emotional benefits within your CVP.  It almost becomes a cheat sheet for Brand Managers to work with.  But you want to just own one emotional zone, not them all.  

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Reasons to Believe (RTB’s)

If we borrow from classic logic below, they teach you to one conclusion and two premise.  I took one logic class and sat there for 13 straight weeks of premise-premise conclusion.  Easy class, but the lesson has stuck with me:

      • All fish live in water (premise)
      • Tuna are fish (premise)
      • Therefore, tuna live in the water (conclusion)

In a positioning statement, the brand benefit would be the conclusion.   And the Reason to Believe (RTB) would be the supporting premise.  I say this for a few reasons.  First, the RTB should never be the conclusion.  The consumer doesn’t care about what you do, until they get something from it.  The benefit has to come from the consumers’ shoes.  Second, if pure logic teaches two premises are enough to draw any conclusion, then you really only need two RTBs.   Brands with a laundry list of RTBs are not doing their job in making a decision on what the best support points are.  You either force the ad agency to decide what are the most important or the consumer to decide.  By deferring, you’re weakening your argument.

While this helps with HOW to write a positioning statement, ask Beloved Brands how we can help really bring the concepts to life with a workshop with your team as well as writing of the final concept options.  We promise to bring magic to the concept which will help get you into the right positioning.   For more reading on how to turn this positioning statement into a concept, follow this link:  How to write a winning Brand Concept statement

Now go find your brand’s point of difference

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on BRAND STRATEGY, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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Top 10 Super Bowl Ads of all time

Slide1I hope a few of these spots bring back some good memories for you and if there are any special ones missing for you, feel free to add them in the comments.  I really hate the latest trend where companies are releasing their ads the week before or for this year, two or three weeks before. Yes, that’s great for sharing on line. But I’ve already seen some of this year’s ads and seeing these ads on a small computer screen, on my own, at random hours isn’t as exciting as seeing them at a Super Bowl party.

As we get ready for this year’s game, here are ten great ads from Super Bowls past. Enjoy.

Coke “Mean Joe Greene” (1979)

Bit of that 1970s “cheese” for you, but I remember this one from my teens.  The spot has become as iconic as the drink itself.  

 

Apple 1984 (1984)

Great story of this ad in the Steve Jobs book–how the board never wanted to run it and they lied about the media commitment.  This was one of the first big Super Bowl ads, that changed the way advertisers saw the Super Bowl slots.    

McDonald’s Jordan vs Bird (1992)

This one had a lot of break through and left us with the phrase “nothing but net”.  

Cindy Crawford “New Can” (1992)

Not much needs to be said about this one, other than that they repeated this 10 years later and she still looked the same.  

Budweiser: WASSUP! (1999)

The simplicity of this one, but it really does capture a male-bonding insight of how guys do interact with their buddies.  

Snicker’s Betty White (2010)

Whatever Betty was paid, she’s made millions since because of this spot.  Quickly after this one, the power of a Facebook page demanded that Betty host Saturday Night Live.  A great little spot, one that Snicker’s has yet to fully capture in their pool outs on this campaign.   

Chrysler Eminem (2011)

I love the tone of this spot, perfect casting with Eminem–the rawness of his voice, attitude and authenticity.  The repeat in 2012 using Clint Eastwood was a good spot as well, but not quite up to the Eminem version.  “Imported from Detroit” is a very big idea. Love it.  

Budweiser 9/11 Tribute (2002)

Even after all these years, this one might bring a tear to your eye.  Months after the tragedy of 9/11, this one takes the American icons of Budweiser and the Clydesdales marching through the streets of America and gives a nice salute to NYC.  

Google “Parisian”

Beautiful ad that shows the power of Google as an enabling brand to your life.

Ram “farmer”

One of my fav ads of all time, and takes such a huge artistic risk by launching such a quiet ad that really tugs at the heart, when most other brands are doing slapstick ads.

Good luck to this year’s Super Bowl, as many of us will be watching the TV ads as much as we’re watching the game.  The power of the venue as the Super Bowl out draws the final game of the other 3 sports (Baseball, Basketball and Hockey) combined.  

Let’s hope for a great game and maybe one great ad to add to this list.

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on BRAND STRATEGY, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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Dollar Shave: an amazing underdog “niche strategy” success story

art-1-dollar_shave_clubDollar Shave Club is a subscription based razor company, founded in 2011 by Mark Levine and Michael Dubin based on the idea that consumers are highly frustrated with the growing cost of razor blades. This is a classic case of finding a major un-addressed problem that consumers are facing in the market, and use a creative brand solution that helps to turn that problem into a consumer enemy that upsets them emotionally. We are seeing many brands use new technology options to set up the old guard as the enemy ready for attack. This has been the strategy for Netflix on movie rentals, Beats by Dre on the headphone business and the Uber brand on the entire taxi industry. And this is the strategy for Dollar Shave on Gillette. With the cost of a pack of razors going for $20 at your average drug store or even $40 at Costco, there was a huge opportunity in the marketplace. Yes, we’ve seen huge technology gains in the last 20 years with way more blades than we ever though possible, flex balls and blue lines telling us when to throw it out. But for a great many of us, price still matters. 

We’ve always said that brands really have 4 options: better, different, cheaper or else not around for very long. The key is to find a unique selling proposition for your brand.  You don’t always need to find a rational point of difference as long as there is room to be emotionally unique.  Slide1

Here’s how this competitive positioning process works: Map out everything your consumer wants–all the possible need states. Then map out all the benefits that you and your competitors can do better than anyone else–both functional and emotional zones.  You want to find that intersecting zone where what you can do best matches up to a need state of the consumer.   Then find a way to serve that need state to the best of your ability and transform it into an even bigger deal than first meets the eye.   Avoid the intersecting zone where your competitor is better than you and please avoid that zone where you and your competition foolishly battle in an area that “no one cares” about.   The battle ground (?) zone is where both you and your competition can satisfy the consumer need at an equal rate.  To win in this situation, you need to get creative and find ways to out-execute or find some emotional connection that changes the game and makes you the clear winner.

For Dollar Shave, they have found the model that makes them definitely cheaper.  I really love the Dollar Shave Club concept — you sign up for a monthly fee depending on the quality of blades (the humble twin, the 4x and the Executive) you order and they automatically send you a free handle and a monthly shipment of blades–in Canada, that cost ranges from $3.59/month up to $9.59/month. In case you want to give it a shot and become a member click on this hyperlink: Dollar Shave Website

dollar shave how it works

Amazing Launch Advertising

Dollar Shave took advantage of viral advertising, making such an innovative ad that it was shared and viewed by up to 18 million people. The ad starring the CEO, who is also a burned out Hollywood actor, was made with such an anti-corporation feel/tone that it jumps off the computer screen. Here is the ad which is appropriately titled: “Our blades are F***ing Great”

Classic Case of Guerrilla Warfare

From the marketing strategy workshop we run at Beloved Brands, we explain how that Guerrilla Warfare works best when no one even notices or can do anything about it. Here are the four key principles brands need to establish a successful Guerrilla niche brand.

  1. Pick a segment small enough that it won’t be noticed and you’ll be able to defend it. Be aggressive. Put all your resources against this small area, so that you’ll have the relative force of a major player.Slide1
  2. Be flexible and nimble. You’ll need to enter quickly to seize an opportunity that others aren’t noticing, but also be ready to exit if need be—whether the consumers change their minds or competitors see an opportunity to enter.
  3. Explore non-traditional marketing techniques to get your brand message out and your brand into the market quickly. Because you’re playing in a non-traditional market, you’ll be given leeway on the tools you use.
  4. For Guerilla brands, it is better to be loved by the few, than liked or tolerated by the many. Leave the masses for the mass brands.

You can imagine that as Dollar Shave started out, they were up going against one of the biggest consumer goliath brands in the world. Gillette’s global sales are in the billions. For Dollar Shave, first year sales were about $30-50 million, while they likely generated a lot of noise at P&G, that sales level should not even be enough to make Gillette lose an ounce of sleep.

But that’s a ton of money for an entrepreneur. 

In fact, Dollar Shave did a great job in backing Gillette into a corner where they would have a hard time changing their entire business model to counter Dollar Shave. Are they going to upset major retailers by offering their own subscription model version? They can’t. Are they going to dramatically lower their price from $27.99 for 10 razors down to $9.99 and give up all the profit they are already generating? They can’t. The best move would be to control Dollar Shave and allow them to stay at the $50 million level. However, Dollar Shave has continued to expand on their niche and got big enough to prompt action from Gillette. But let’s be honest, this is a very lame reaction below:

I’m not sure that ad will get many to sign up for the Gillette subscription model, as it’s not exactly the full on attack that a Leader normally uses to squash the naughty little niche player that’s bugging them. The good news for Gillette is only 199,000 people have seen this on-line, compared to 18 million views for Dollar Shave.

Let’s use a little Napoleonic military theory for a minute to analyze what’s happening here. Napoleon had two main strategies:  The first strategy Napoleon: Where there is opportunity to win against their strength, ATTACK THEIR STRENGTH, then the weak area will be that much easier. This type of Strategy would be better for Schick as the challenger brand to use. If a Niche brand goes against the leader’s strength right away, they will be clobbered. The Dollar Shave brand used Napoleon’s second strategy: Where there is a limited opportunity to win against their strength, then ATTACK THEIR WEAKNESS, and once they mobilize their strength to attack back, you can then attack their strength. This is where Dollar Shave attacked Gillette on price. I’m not sure if Dollar Shave expected a reaction, but eventually got so big after 2 years, that it became warranted. The good news for Dollar Shave is that their attack has brought Gillette to fight back on Dollar Shave’s terms–on the subscription battle field. But while Gillette is mobilizing, Dollar Shave is now able to attack back at Gillette’s point of strength: the drug store.  Here’s how that Napoleonic Strategy #2 maps out.

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Dollar Shave’s round two of advertising in 2015 is making a mockery of how Gillette does business: launching 4 ads that poke fun at the security around buying razor blades and the special promotional gift you get. Here’s two very funny ads, in their latest series of four TV Ads they are currently running, generating a lot of talk value among the core 18-24 year old target market:

Dollar Shave “Security”

Dollar Shave “Free Gift”

These are fantastic Dollar Shave ads. They generate a lot of attention, the branding irreverent tone fits with the Dollar Shave launch, these ads communicate the main benefit that Dollar Shave is a simple model that will save you money and has that memorability factor that will stick with consumers. Not only is Dollar Shave using more traditional TV media to push for a higher reach, these ads have been seen by a combined 3 million people on line.

Well played Dollar Shave:  your move next Gillette

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on BRAND STRATEGY, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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Making brand leaders better at running the brand financials

Great Brand Leaders, not only drive demand, they drive profitable demand.

Slide1A lot of marketers enter in marketing as a career because they weren’t into the numbers part of business. However, the reality is that to run a brand you have to be good at running the P&L. The only reason that brands exist is that you can create a bond, power and profit, beyond what the product itself could achieve. At Beloved Brands, we believe that passion matters because the more loved a brand is by consumers the more powerful and profitable that brand can be. So in everything you do as a brand leader, even as you are launching new products, creating new advertising or writing a great brand plan, you have to have profit front and center in everything you do. Yet, there are far too many Brand Leaders who can’t run the P&L. These Brand Leaders hit the mid-point of their career and then we realize that they aren’t very good with numbers and all of a sudden, a fast track career for the super star Brand Manager completely stalls. As you’re looking up to the director level jobs, challenge yourself to get better with finance.

Looking at the P&L

Here’s my Finance 101 that can help  simplify your role with the P&L. This is meant for the Brand Manager level who is aspiring to continuing to move up.  But regardless of level, if you secretly are weak in the P&L area, this might help you.  Slide1

While it’s important to learn every line of the P&L, where Brand Leaders can have the biggest impact is on the Net Sales, the Gross Margin and the Contribution Margin.  The Net Sales line is simply Gross Sales minus the Trade Spend. Some income statements have brought the trade spend up to the sales line, while others have left it down in the cost line. Check with your company’s or country’s way of doing it.  In many industries, the trade terms are dictated by the channels.  While I would want to say the more Beloved Brands have a power over the channels, many times they still aren’t able to turn that power into lowering the trade spend.  If the trade spend is out of your control, you should be working with sales to ensure you are maximizing the value in programs that you are getting for the trade spend.  

Net Sales is the Unit Sales times Net Price. For unit sales, you’ll have to either drive the market share or enter new markets. That’s where the marketing programs you leverage drive faster growth relative to the spend. And for price, you can increase price or get consumers to trade up to a premium price within your portfolio.  The overall brand image you drive will usually be one of the biggest impacts on price. The more love you create for the brand, the more inelastic the price. 

Gross Margin is Net Sales minus Cost of Goods.  Just like above this can be impacted by how high of a price premium you can drive for the brand, or whether you can lower your Cost of Goods without impacting the quality of the product.  As a Brand Manager, this becomes your primary focus for “profit” as you feel the below the line costs are out of you control, so you don’t pay much attention to them.   However, as you get up to the Director or VP level, you get involved in discussions about marketing spend, R&D and the goals for the bottom line contribution margin levels.  This is where your strength or weakness in running the P&L begins to really show up.  

The ways brand leaders can Drive the P&L

Looking at the above P&L lines, in a slightly different way you really have 8 different areas that you can impact the Profit:

    • With Price, you can increase/decrease the price or you can get consumers to trade up to a premium line or down to a value line.   
    • When looking at Costs, you’re either driving the product costs or the marketing costs. You’re trying to minimize the costs without impacting the brand or the impact on the brand.
    • Driving the Market Share is a focus on either stealing other users or getting your current users to use more. 
    • The Market Size is all about entering new categories or finding new uses for your current brand.  

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Using Price as a weapon to drive brand value.  It can be a price change, up or down, or it could be trying to get consumers to trade up or down.

  • Price Increase: You can do a price increase if the market or brand allows you. It likely has to be based on passing along cost increases. Factors that help are whether you are a healthy brand or it’s a healthy market as well as the power of your brand vs competition and channel.
  • Price Decrease: Used when fighting off competitor, if you need to react to a sluggish economy or channel pressure. Another reason to decrease price is if you have a competitive advantage around cost, whether that’s manufacturing, materials or distribution.

There are watch outs for price changes. It’s difficult to execute price changes especially if it has to go through retailers. You need to understand power relationships–how powerful are the retailers. Many times, price changes are scrutinized so badly by retailers that you must have proof of why you are doing it. Also, it’s quite likely your Competitors will (over) react. So your assumptions you used to go with the price increase will change right after. And finally, it’s not easy to change back.

  • Trading Up: If you have In a range of products, sometimes it can be beneficial to get consumers to trade up. Can you carve out a meaningful difference to create a second tier that goes beyond your current brand? Does your brand image/ratings allow it?
  • Trading Down: Risky, but you see unserved market, with minimal damage to image/reputation of the brand. In a tough economy, it might be better to create a value set of products rather than lower the price on your main products.

When looking at Price Increases, here’s a formula to help get you started on your analysis for gaining approval.  

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Beloved Brands seem more capable at driving profits through pricing, but they also are careful to ensure the premium does not become excessive to create backlash. There are a few watch outs around trying to trade up or down: Premium skus, can feel orphaned at retail world—on the shelf or missing ads or displays. Managing multiple price levels can be difficult—what to support, price differences etc. For all the effort you go to, make sure your margins stay consistently strong through the trading up or down. Be careful that you don’t lose focus on your core business. Can’t be all things to everyone. The final concern is what does it do your Brand’s image, especially risky when trading downward.

Managing cost as a weapon to enhance the Brand’s Value. It can be either your cost of goods or the potential selling costs.

  • Cost of Goods Decreases: You are able to use the power of your brand to drive power over your suppliers, you find cheaper potential raw materials, process improvement or find off-shore manufacturing.
  • Cost of Goods Increases: Make sure that you manage the COGs as they increase. Watch out for suppliers trying to pass along costs. But realize that with new technology, investing in brand’s improved image, going after premium markets, offering new benefit or a format change, that cost of good increases could be a reality.

The watch outs with managing costs: with cuts, make sure the product change is not significantly noticeable. You should understand any potential impact in the eyes of your consumer on your brand’s performance and image. Can the P&L cover these costs, either increased sales or efficiency elsewhere. Managing your margin % is crucial to the long-term success of your brand.

  • Selling Cost Decrease: To counter changes in the P&L (price, volume or cost), it’s very tempting to look to short-term P&L management or look at changes in go-to-market model. Where a brand stands on the product life cycle or how loved the brand is can really impact the selling costs. Even though we think that Beloved Brands have endless spending, they actually likely have a lower investment to sales ratio.
  • Selling Cost Increase: When you’re in Investment mode, defensive position trying to hold share against an aggressive competitor or when you see a proven payback in higher sales–with corresponding margins.

Here’s a simple margin calculation to get you going:Slide1

Always be in an ROI mindset: Manage your marketing costs as though every DOLLAR has to efficiently drive sales. Realize that short-term cuts can carry longer term impact. Competitive reaction can influence the impact of investment stance–like a price change, your competitor might over-react to your increases in spending.

Externally, the Share and volume game are traditional tools for brand. Either stealing other users or get current users to use more.

  • Offensive Share Gains: Use it when you have a significant Competitive Advantage or you see untapped needs in the market. Or opportunistic, use first mover advantage on new technology.
  • Defensive Share Stance: Hold the fort until you can catch up on technology, maintain profitability, loyal base of followers needs protecting.

Be careful when trying to gain share. A Beloved Brand has a drawing power where it does gain share without having to use attack modes. Attacking competitors can be difficult. It could just become a spend escalation with both brands just going at it. After a share war that’s not based on a substantive reasoning (eg. technology change), there might end up with no winners, just losers. Many times, the channel will try to play one competitor against another for their own gain. Watch out what consumers you target in a competitive battle: some may just come in because of the lower price and go back to their usual brand.

  • Get Current Users to Use More: When there is an opportunity to turn loyal users into creating a potential routine. Changing behaviours is more difficult than enticing trial. It’s a good strategy to use, when your there’s real benefit to your consumer using more. It’s hard to just get them to use more without a real reason.

There has to be a real benefit connected to using more or it might look hollow/shallow. Driving routines is a challenge. Even with “life saving” medicines, the biggest issue is compliance. Find something in their current life to help either ground it or latch onto. When I worked on Listerine, people only used mouthwash 20-30 times a year compared to 700+ brushing occasions. So we focused on connecting rinsing with Listerine to the twice daily brushing routine.

Increase the Size of the Market by Finding New Users or Creating New Uses.

  • Find New Users: When there is an untapped or under-served need. There could be a significant changing demographic that impacts your base. Or you are able to translate/transfer your reputation to a new user group. There should be something within your product/brand that helps fuel the brand post trial. Trial without repeat, means you’ll get the spike but then bust. Substantial investment required. Don’t let it distract from protecting the base loyal users.
  • Create New Uses: Format Line Extensions that take your experience or name elsewhere. Able to leverage same benefit in convenient “on the go” offering. Make sure current brand is in order before you divert attention, funding and focus on expansion area. Investment needed, could divert from spend on base business. Be careful because the legendary stories (Arm and Hammer) don’t come along as much as we hope.

As you look to either grow by share or new categories the two crucial calculations for you are Compound Annual Growth Rate (CAGR) and Return on Investment (ROI) 

For CAGR, here is a calculation tool:

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And for Return on Investment (ROI):

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Show Your Work:  Just like in grade school where you get extra points for showing your work, the same thing goes when taking senior leaders through your assumptions.  

There is only one reason we have brands: to make more money than if we just had products.

To view a copy of How to drive Profits into your Brand, click below:

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

We make Brands better.

We make Brand Leaders better.™

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The 10 real reasons that Target failed in Canada

target5Having lost nearly $1 billion in its first year in Canada, and facing more multimillion-dollar losses, Target announced on Thursday it would discontinue its operations in Canada and close its 133 stores. While the news of them closing should not be a surprise, the speed in which they left feels pretty shocking. They didn’t even make the 2-year anniversary of the new store.

1. Target just wasn’t different. 

Brands really only have four choices: they can better, different, cheaper or not around for long. For Target in the US, they have always taken the “different” positioning–focused on cool suburban moms, broader offering. But in Canada, Target basically became Wal-Mart with red paint. They never found a way to separate themselves to be seen as different enough to get “new consumers” to try it out and yet they seemed to disappoint those potential loyal consumers who had already bought into the US version of Target. 

2. The suburban positioning already taken in Canada

In the US market, Wal-Mart grew up through the 70s and 80s as a small town or even a rural brand, providing the opportunity for Target to become the suburban version of Wal-Mart. But even looking at pure demographics, Canada has the biggest middle class population in the world, the population is very concentrated to six main cities, where as in the US there are many small towns scattered throughout. When Wal-Mart entered Canada, they purchased the retail footprint of Woolco, which was a suburban brand. The Wal-Mart strategy in Canada closely resembled what Target had done in the US: going after suburban moms, new/fresh stores, big wide/clean aisles making for a better shopping experience than in the Wal-Mart stores in the US.

3. The Low priced clothing for cool moms positioning was already taken in Canada

joe_freshLoblaws is the biggest food retailer and are known for a) copying great retailers around the world b) attacking their competitors viciously. While originally a grocery store, the Loblaws stores have become a mass merchandiser store where you can get the same low-priced clothing for the cool moms, via the JOE FRESH brand. This took away a potential competitive advantage for Target to leverage.

4. Target invested too much and too fast in new locations and new employees

Target launched 133 stores and hired 17,000 employees in Canada–almost half of Wal-Mart’s footprint in Canada, who have been here for 20 years. Taking on the leases of Zellers and then fixing up their locations was costly and crippling to the operations.Target tried to do way too much too soon–hurting their ability to deliver the same experience they are delivering in the US. Target had two strategic choices at launch: a) pick limited locations and do it right or b) cover everywhere in Canada as a preventative strategy against competitive attacks. They decided to be everywhere, and as we can see did a very bad job. They should have staggered their launch by starting with Toronto only, expanding to key markets as they established themselves and managed to create a loyal following. Operations were awfully sloppy. The procurement system was so poorly run that empty store shelves were not uncommon. Given the empty stores, it’s hard to really blame a run on merchandising.o-TARGET-CANADA-EMPTY-SHELVES-facebook

5. Target had no money left to actually drive demand

The best thing about Target is you could get a great parking spot, there were no crowds in the aisles and you didn’t have to line up to pay. Why? Because, there was no one there. As all the money went into the bricks and mortar of creating new stores, they had very little money left over for marketing. In the 18 months since launch, there was very little hype, no great advertising, no wonderful launch events, no press coverage, very little on social media. They never created the demand needed to drive revenue.

6. They didn’t have the same selection as their US stores

The most loyal Target shoppers in Canada had experienced the Target store in the US for years, whether they were cross border shopping or going to Target when they were vacationing in Florida, Arizona or California. And the biggest complaint they had about Target Canada is the lack of product breadth on the shelves. They were expecting the identical offering they saw in Target US. But that’s not a reality. Target is JUST a retailer at the mercy of what the manufacturers offer in Canada. There are numerous factors that impact the variety when it comes to Canadian manufacturers–the biggest being the relative size of listing fees that Canadian retailers demand are so big that launching smaller small skus just doesn’t make sense in Canada. The difference in government regulations will also alter what products can be available for sale.

7. Target US sales dropped the minute they announced they were going into Canada

Target is a very US centric brand, with Canada representing their first attempt at International–and it might be their last. As soon as they launched, they faced declining sales and share in the US. It was unrelated, but now Target management faced two issues at once–a turnaround strategy to solidify US sales and a launch strategy internationally. Anytime you divert your attention, you’re likely to mess one of them up, and the Canadian launch suffered. 

8. The dropping Canadian dollar messed up their financial contributions

Screen Shot 2015-01-18 at 11.48.38 PMWhat is not mentioned very often is that the Canadian Dollar has fallen from relative parity when they were considering launching two years ago to 0.83 cents. That has a two-fold impact: the reporting of sales and profits internationally just took a 17% hit due to exchange and the imported items from the US just saw a big cost increase that will bite into the margins. With those loyal Target shoppers already upset that the Canadian and US prices are not equal, there was very little opportunity for Target to cover the impact of the dollar in their P&L. 

9. Target saw very little risk to leaving

When they made the decision to exit Canada, they did so very quickly and from reading everything said this week by Target, they showed very little remorse. The opening of their press release started by telling the US manufacturers that this statement had zero impact on the US stores or their standing with manufacturers in the US. Rather than bite the full financial bullet, Target has asked for somewhat of a bankruptcy protection, like Chapter 11 in the US. I guess the question is “why are they asking for any protection?”.  Yes, they said they would create a trust that would cover 16 weeks of severance pay for “most” of their employees. The “most” line caught my eye, which feels similar to that classic “Up to 70% off everything in store”. We shall see how fairly they treat ALL 17,000 employees. And will the protection get them out of leasehold agreements that leave malls empty and scrambling to fill them and will they treat the uniquely Canadian manufacturers the same as they treat their US manufacturers. 

10. Their loyal consumers embraced Target more than Target embraced their consumers

When consumers care more than the brand, that brand is in trouble. And from what I can see, there still are many loyal Target consumers who are disappointed in the news. At Beloved Brands, we believe passion matters, because the more loved a brand is by consumers, the more powerful and profitable that brand will be. Target did very little to create love with consumers. Their promise lacked any real difference and they failed to tell their story to the Canadian marketplace. There was zero magic in the way they connected with consumers and zero magic in the experience in the stores. 

Let this be a lesson to the next retailer who will venture into Canada

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911

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How to communicate your brand story internally, by turning your “Big Idea” into a Brand Credo

Does your brand have a brand credo? How do you communicate your brand story internally?

With most brands I meet up with, I ask “what is the big idea behind your brand?” Slide12-2
and I rarely get a great answer. When I stand in front of the bigger brand team and ask that question, with the best brands I get one answer, and with struggling brands, I can guarantee I’ll get multiple conflicting answers. That’s not healthy. I always say that brands should be able to explain themselves in 7 seconds, 60 seconds and 30 minutes, all laddering up to the same message. There are too many Brands where what gets said inside the corporate office is completely different than what gets said in the marketplace. Moreover, there are brands that only view “messaging” as something Brand does in TV ads or through logos. How do you communicate what your brand stands for when you’re with R&D, HR, or finance? I recommend you create your own Brand Credo, which should come directly from your brand’s Big Idea. Here’s how:

Start with finding the Big Idea of your Brand

I’ve always heard how Brand is the hub of the organization and everything should revolve around the Brand. While it makes sense, it’s just talk unless you are managing your business based on your brand’s Big Idea throughout every inch of your organization. Everyone connected to the brand, should fully understand the brand’s Big Idea. And when I say “everyone”, I’m talking about everyone in the entire organization, including Sales, Finance, Production, R&D, HR and Marketing, as well as everyone outside the organization including agencies or employees at your retailers.

We’ve explained the Big Idea tool a few times, but here’s a refresher. The Brand’s Big Idea (some call it the Brand Essence) is the most concise and inspiring definition of the Brand. For Volvo, it’s “Safety”, while BMW might be “Performance” and Mercedes is “Luxury”. Volvo has stood for safety for almost 60 years, long before safety even registered with consumers. Here is the Tool I use to figure out a Brand’s Big Idea.  The model revolves around four quadrants that surround and yet help to define the Brand:

  1. Brand’s personality: human descriptors that express the brand’s style, tone and attitude.
  2. Products and Services: features, attributes, and functional characteristics that are embedded in what we sell.
  3. Internal Beacons: the internal views or purpose of the brand, why people believe their brand can win, what inspires, motivates and challenges.
  4. Consumer Views: honest assessment of how the consumer sees the brand, the good and bad.  

big ideaHow this tool works best with a team is that we normally brainstorm 3-4 words in each of the four quadrants and then try to form those words into a sentence for each quadrant. After all 4 quadrants are filled, we then looking collectively and begin to frame the brand’s Big Idea with a phrase that embodies the entirety of the brand. As I facilitate sessions using this tool, it’s almost magical as we see the brand really come to life. You have to have a bit of faith that the work around the big circle provides you with an inspiration for what the big idea really is. Executives love this exercise and it works.  This is the Big Idea completed for my own brand: Beloved Brands.Slide1

Simplify your Brand’s Big Idea into a Credo that motivates and steers everyone

Slide1Having spent time at Johnson and Johnson, the Credo document is an essential part of the culture of the organization. Not only does it permeate throughout the company, you will likely find it quoted in meetings on a daily basis. It’s a beautifully written document and ahead of its time. The original author was General Robert Wood Johnson in 1943. What is most fascinating from a brand vantage is that the first responsibility is to the healthcare professionals and consumers who rely on the J&J products. He understood their importance above and beyond anything else. The second and third tenants were to employees and the community with the final tenant being the stockholders. Yes, business must make a profit. But as the document suggests there is a belief that if you cover off the first three, the shareholder should benefit–but should never be placed ahead. Keep in mind, this was written when there was only one shareholder–Mr Johnson himself–but he knew that the company would be going public the next year. He wanted to use this Credo document to steer the culture based on his values.

Like any company these days, J&J has veered off course either through business decisions or ethics. But having that document allows them to take action.

If you have the energy to write such a document go for it. But Ritz-Carlton has created a much simpler Credo example they use to steer their brand experience through their people. Recognizing that any great brand has to be better, different or cheaper to win, Ritz ritzcredo1Carlton focuses their attention on impeccable service standards to separate themselves from other Hotels.  What Ritz Carlton has done so well is operationalize it so that culture and brand are one. 

I was lucky enough to be able to attend the Ritz Carlton Training session, and as a Brand Leader, the thing that struck me was the idea of meeting the “unexpressed” needs of guests.  As highly paid Marketers, even with mounds of research, we still struggle to figure out what our consumers want, yet Ritz Carlton has created a culture where bartenders, bellhops and front desk clerks instinctively meet these “unexpressed needs”.  Employees carry around note pads and record the expressed and unexpressed needs of every guest and then they use their instincts to try to surprise and delight these guests.

Employees are fully empowered to create unique, memorable and personal experiences for our guests.  Unique means doing something that helps to separate Ritz Carlton from other hotels, memorable forces the staff to do something that truly stands out.   And personal is defined as people doing things for other people. The Ritz-Carlton Credo does a nice job articulating who they are and provides some support for their Big Idea, but does not go far enough. 

Slide1Looking at the Beloved Brands Credo example, we believe that a well-articulated credo should answer:

  • What is you brand’s big idea? What is the one thing that you do better, different or cheaper than anyone else?
  • What are the two ways you can bring that big idea to life (proof points, values, beliefs, tone) that helps to separate your brand from the pack?

The Beloved Brands Credo leads off with the big idea of making brands and brand leaders better. While a lot of consultants can claim that, we think our belief about brands that helps separate us. We link the passion of the work to the love of your brand which can then be harnessed for growth and profits. What also separates us is how we challenge brand leaders, not just in our tone but with new ideas, models and systems that are all linked to fundamentally helping brands and brand leaders unleash their full potential.

To read more click on this hyper link:  Tools to help you describe your brand in 7 seconds, 60 seconds and 30 minutes

Communicating your brand story internally is as crucial as any external communication to the market

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To see a workshop on THE BRAND LEADERSHIP CENTER, click on the Powerpoint presentation below:

We make Brands better.

We make Brand Leaders better.™

We offer brand coaching, where we promise to make your brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your brand’s full potential. For our brand leader training, we promise to make your team of brand leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911Slide1

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