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Welcome to Loyalty MagazineLoyalty Magazine reports on customer retention,loyalty schemes, rewards, affinity, CRM, call centre issues, direct and viral marketing, mobile and internet channels for both B2B and B2C enterprises. It covers all global markets and business sectors, including retail, financial services, travel and hotels, telecoms and electronic commerce. |
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Monday, 09 August 2010 15:53 |
Don’t Mess with the Logo
There is a little confusion in the titling of this book. For a start, they didn’t want to say ‘mess’ they wanted to say something ruder, but book publisher Financial Times Prentice Hall said no, because their brand was not a sweary brand.
And then there is the fact that this book is about branding, not just logos. The athors explain that management always wants to redesign the brand when doing a product revamp, when really, say the authors, it is about a great deal more than just the logo. For example, customer service and customer satisfaction.
An important point is made as early as page 5, that before 1963, people didn’t put much of a value on a brand. But then Rank Hovis McDougall (RHM) fought off a hostile acquisition from the Australian firm Goodman Fielder Watts (GFW) by having all its brands (including Hovis bread, Saxa salt and Bisto gravy) valued financially, andi ncluded their value on the balance sheet. This ramped up the value of RHM dramatically and beyond the price that GFW was prepared to pay.
So the value of brands was well and truly established.
The next really important time for brands was in the nineties, when companies including Virgin, proved that you didn’t need to be in a sector in order to go there. Until then, financial services were the domain of banks and insurance companies. Not any more. From then on, even a supermarket could sell you a credit card. After that, the internet opened up the world.
Brands are important, both for the consumer and the company that owns them, because they prove identity. This is important for the company in terms of protecting its intellectual property, and for the consumer who is able to protect his rights.
And some brands are worth a lot of money. Google for example is considered by the Brand League Table 2008 to be worth more than US$86bn. Microsoft US$72bn and Apple US$55bn.
The accepted definition of a brand is that it consists of product plus image. Authors Jon Edge and Andy Milligan have come up with what they consider to be a more encompassing equation. They suggest the brand is E x E x E = B. This means Essence times Expression times Experience equals brand.
Essence is what you stand for, expression is how you communicate it and experience is what you actually make or prove. This equals the brand, which is what people think of you.
Staying true to your promise
So far so good. The authors then go on to discuss how a brand needs to stay true to its promise, and if it does so, then it will make money.
They examine how to build a brand, how to plan a brand strategy – and for a book about brands, there is a refreshing amount of content concerning the customer, and how satisfied they are.
All too often, branding remains in a silo, the domain of advertising and branding agencies, and perhaps the marketing department, with very little interaction with the customer facing departments. But not this one.
Net Promotor Score
There is a detailed discussion of Net Promoter Score, which aims to inform the customer how satisfied its customers are, by getting them to score it on how likely they are to recommend its products and services to friends and family.
It also looks at other measurement methods, but warns that it is estimated well over 50% of research spend in the UK is wasted.
It gives the following example: “One company spent close to US$1 million trying to understand what its customers valued. In all, 200 employees in 17 different departments were involved in 105 separate customer research activities. This sounds impressive, but unfortunately there were two major problems. First the data collection effort was uncoordinated. Some customers were contacted almost four times a month, and not surprisingly, they often complained of being asked similar questions by different people for different purposes. The second problem was that the data collected in the company’s US41 million effort was not being used to improve much of anything. It just lay there. Only 43% of the people who had collected the data reported it to anyone but themselves. Only 39% said any action was taken as a result. Only 27% of the information taken from external customers was reported as “acted upon”. It was as if the data so assiduously gathered had disappeared into a black hole.
Don’t Mess with the Logo is thoughtfully produced in an enjoyable style, but it runs out of steam a little towards the end, when talking about what it calls digital stuff, and in its last lesson, which claims that sex sells, but then gives little to back up the theory apart from a list of websites.
Don’t Mess with the Logo, by Jon Edge and Andy Milligan is published by FT Prentice Hall, price £14.99. More information www.pearson-books.com. |
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Positive impact of the feedback huddle