What is a Brand?

A Collection of Thoughts, Concepts, and Perspectives on Brands and Branding

Collected, compiled and edited by Rick Cornish with Laura Sommers

917 North Fifth Street | Minneapolis, MN 55401 | 612.752.0200 | flyingcolors.biz

W H AT I S A B R A N D ?

What is a Brand?
A Collection of Thoughts, Concepts, and Perspectives on Brands and Branding

Collected, compiled and edited by Rick Cornish with Laura Sommers Flying Colors Incorporated, 917 North 5th Street, Minneapolis, MN 55401 612.752.0222 [email protected] | www.flyingcolors.biz

2008 Flying Colors Incorporated All Rights Reserved May be quoted in publications with attribution. May not be reproduced, sold, or distributed without the expressed, written consent of Flying Colors Incorporated.

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Introduction
The goal of this article is to provide a broad conceptual understanding of what branding isand (perhaps just as importantly) what its not. Well cover why companies spend so much time, effort and money on branding and how those investments come back to them. And how brands are created, built, and maintained. People in business often forget that our economic entities are populated with emotional beings. Feelings beget attitudes which, in turn, beget behaviors. So when your product or service elicits specific feelings with specific people your brand has tremendous power with them.

A Short History of the Brand

The word brand comes from the Old Norse brandr, meaning to burn. It was by branding that early man stamped ownership on his livestock, and later, buyers would use these brands as a means of distinguishing between the cattle of one farmer and another. A farmer with a particularly good reputation for the quality of his animals would find his brand much sought after, commanding a premium price, while the brands of farmers with lesser reputations were avoided or treated with caution. Thus the utility of brands as a guide to choice was established. Some of the earliest manufactured goods were clay pots, the remains of which can be found in great abundance around the Mediterranean region. There is considerable evidence among these remains of the use of brands in the form of the potters marka thumbprint in the clay on the bottom of the pot, or a mark such as a fish, a star or cross. From this we can safely say that these symbols (shall we call them logos?) were the earliest visual manifestation of brands. In Ancient Rome, commercial law acknowledged the origin and title of potters marks, though this did not deter the makers of inferior pots from imitating the marks of well-known makers to dupe the public. Thus, as trade began to flourish, the practice of unlawful imitation lurked close behind, a practice that continues to challenge our legal systems to this day. At the dawn of the industrial revolutionas products first came to be available en massepower in the marketplace belonged to the producers

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of goods. Manufacturers chose what they would make and what they would sell. Later, in the economic revolution of the 1950s and 60s, power shifted to consumers. They started wantingand gettingmore choices. But (be careful what you wish for), the result turned out to be more than consumers were prepared for. This proliferation of product options led to a new problem: Overchoice. Today, we know that the human brain has two mechanisms for making decisions; the rational and the emotional. Too much choice has overloaded the consumers capacity to make a buying decision on rational criteria alone. Weve become information-rich and time-poor. Faced with up to 53 different varieties of toothpaste, the consumer needs a more efficient path to decision-makinga shortcut. To make deciding simpler for the consumer, marketers have re-focused their messages to the buyers emotional side. And buyers have responded. Like the farmers of old (and not-so-old) times, savvy marketers began using brands, but with a new goalto burn a distinct impression in the minds of consumers one that clearly sets the well-branded product apart from the rest of the herd. In our world today, people dont really buy products. They buy feelings. Hopes. Aspirations. Desires. They buy brands. Brands offer a host of emotional benefits: connection; comfort and familiarity; relationships; identity, I see me, or who I want to be; bonding; consistency. Consumers make many buying decisions based on symbolic attributes: What does the product look like? Who sells it? Who are the other people who buy it? And do I trust the company that makes it? In other words, how do I feel about belonging to this brand? Branding and brand names are important because they give the consumer a frame of reference when making purchasing decisions. By now, consumers have been trained to make judgments based on brands. Many products and services that used to be uniqueand could survive strictly on filling a niche now have plenty of competition from products that look very similar to theirs. People will buy brands they recognize, regardless of whether or not they know or believe the claims, simply because there is comfort in that which is known. Branding is not about getting your prospects to choose you over your competition, says branding guru Rob Frankel, its about getting your prospects to see you as the only solution to their problem.

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The ultimate goalthe holy grail of brandingis something very tangible: to pre-sell a product or service, creating the perception that there simply is no alternative.

So, What is a Brand?

Perhaps brand expert Marty Neumeier said it best: A brand is not what you say it is. Its what they say it is. A brand encompasses the sum total of how a business, product, or service is perceived by those who interact with it. For employees, it represents their pride in belonging. For suppliers, it governs how they optimize their operations to better serve us. And for customers, a brand is both their belief in who we are and a badge they wear that communicates something about who they are. For example: What kind of car do I drive? What kind of beer do I drink? Do I use a Mac or a PC? Do I wear a team logo on my apparel? Whose? For a company, a brand is a promise we make to everyone we interact with. And every day we either keep our promise and earn our customers trust or we dont and suffer the consequences. Walter Landor, one of the greats of the advertising industry, said it this way: Simply put, a brand is a promise. By identifying and authenticating a product or service it delivers a pledge of satisfaction and quality. In his book, Building Strong Brands, David Aaker suggests the brand is a mental box and gives a definition of brand equity as a set of assets (or liabilities) linked to a brands name and symbol that adds to (or subtracts from) the value provided by a product or service. This is an important point, because the collection of feelings, experiences, and associations that comprise a brand can be either positive or negative. A more poetic definition goes something like this: A brand is a collection of perceptions in the mind of the consumer.

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This definition makes it absolutely clear that a brand is very different from a product or service. A brand is intangible. Different people have different perceptions, which result in differing levels of brand loyalty. The power of a brand is in the mind of the consumeror perhaps more accurately its in the heart.

What a Brand is Not

In spite of what many self-proclaimed brand experts say, a brand is not a magic elixir. Its not something that will rescue a flawed business concept as many cleverly-branded dotcoms learned to their chagrin. Its also not something that can be created out of whole cloth and foisted on an unsuspecting public. Most of all, the brand is not something thats created through an endless series of expensively produced television commercials, no matter how clever the concept. A brand is not an advertising tagline or slogan. Its not a building, letterhead or business card. A brand is not even a name or a logo. The American flag is not America and it stands for more than just the land we live in. A brand embodies the feelings a consumer has as s/he relates to these symbols. A brand does not replace a companys mission, vision, or values; but rather reflects all of these. It is not corporate or bureaucratic. A brand lives in the heart of every customer, of every supplier, and of every employee. When all those perceptions align, they bring the brand to life.

Brand Equity
A well-managed brand builds up equity over time. Think of it as the value of good will, earned by years of delivering a consistent experience. We believe the power of a brand is a product of two things: [Prediction of what to expect] X [the emotional power of that expectation]. If we encounter a brand and we dont know what it means or does, it has zero power. If we have an expectation of what an organization will do for us, but we dont care about it again, no power. For example

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 Fedex is a powerful brand because you know what to expect and you always get it. The relief you get from their consistency is high.  AT&T is a weak brand because you almost never get what you expect, because they do so many different things and because the value of what they create has little emotional resonance. (It sure used to thoughwhen they did one thing, they did it perfectly and they were the only ones who could connect you). The strongest brands are easily identified by their customers. The unique value they provide is top of mind. And every interaction customers have with the brand goes to reinforce that perception from the way they ask for the business to the way they send the bill. The most powerful brands of all are those that create a need in the consumers mind that was not there before. Look at bottled water: American tap water is clean and drinkable, yet Evian is worth millions today. A 1.5 liter bottle of Evian sells for 20% more per liter than Budweiser, 40% more than milk, and 80% more than Coca-Cola. Thats the power of a brand.

Every Company Has a Brand

Every company has a brand, but only a few are good at reflecting their brand experience in everything that touches the customer. Some examples of companies that consistently deliver stellar brand management are Nike, Apple, Harley Davidson and Target. When you think of these brands, you undoubtedly get a very precise picture of who they are and what they stand for. A brand clarifies who the company is not in the terms that matter to you, but in the terms that matter to your customer. And that is not a trivial matter.

A Case in Point
If the problem is thirst, Coca-Cola is often seen as the only solution by soft drink consumers. Thats why any discussion of successful branding usually includes The Real Thingnot so much as a beverage, but as a cultural phenomenon. Look at it this way: If Coca-Cola fired all of its employees, sold its real estate, and canceled its contracts with bottlers, it would still have the equity of its brand. The numbers are compelling: The stock market value of The Coca-Cola Company, was around $136 billion in mid-2002, yet the book value (the net asset value) of the business
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was only $10.5 billion. A vast proportion of the value of the business (around $125 billion) is therefore dependent upon shareholders confidence in the intangible assets of the business and the ability of the company to manage these profitably. Coca-Cola owns few intangibles other than its secret recipe, its contracts with its global network of bottlers and its brand names. An independent analysis by brand consultancy Interbrand estimated that the value of the Coca-Cola brand name in mid-2002 was almost $70 billion, well over half of its intangible value and nearly seven times the book value of the company. Now thats brand value.

What Matters Most

Great brands have become enormously valuable because they contain two key elements that companies understand deeply and protect fiercely: That the brand is truly relevant, and that its truly different from its competitors. To identify relevance, we ask: What does the company do for its audiences that they truly want? To identify difference, we ask: What does the company do that no other competitor can ever do? Often, answering these questions means asking the right questions of the right people, including your Brand Universecustomers, employees, suppliers, and all others who come in contact with your business or product. An experienced researcher can tease out what makes a brand relevant to peoples lives and different from others they interact with. In addition to examining peoples needs and perceptions, we also look at the companys business strategies and culture. The brand must also reflect the vision and direction of senior management, and align with the values of the company. A great example of a company that clearly articulates both the relevance and difference of their brand can be found in Targets tag line: Expect more. (Difference) Pay less. (Relevance)

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The Brand Identity

The brand identity is a set of associations the brand strategist seeks to create or maintain. The brand identity represents what the organization wants the brand to stand for. To articulate the brand identity, we must be able to provide concise answers to three outwardly simple questions: 1. Who are you? 2. What do you do? 3. Why does that matter? Once you get into it, it soon becomes apparent that this is not as simple as it looks particularly when you look at your answers and ask, Can any of my competitors say that? This is the essence of articulating your differentiation. With this information, brand strategists will develop core statements that define the brand identity and will serve to guide all manifestations of the brand. These statements can include a Brand Platform, Brand Essence, Brand Personality, Brand Promise, Brand Strategy, and/or Brand Positioning. These are all different types of descriptions of the brand. Keeping things simple, we focus on two key disciplines to keep our work ontask and on-point: The Brand Platform which is comprised of two elements The Brand Promise The Brand Essence

The Positioning Statement The Brand Platform is a strategic tool that articulates the key relevance and difference a company offers to its Brand Universe. The brand platform must also: Support the companys culture, business strategies and goals. Be credible with all audiences. Be brief but memorable enough to be easily adopted by employees.  Strengthen the perception of the company across all touchpoints, including operational interactions, call centers, retail offices, website, communications, etc.

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Within the platform, the Brand Promise captures what the company does in a compelling way while the Brand Essence captures how the business uniquely does what it does. The Positioning Statement is a framework originally devised by Proctor & Gamble that provides marketers a disciplined way to look at how the brand appeals to specific groups. Often, a brand can have a different positioning statement for each group in its Brand Universe. The P&G positioning framework reads as follows: To (target market), (company) is the (business category) that delivers (benefits) in a (unique) way.

Managing the Brand

A companys brand embodies both its image and reputation. Because the brand is a perception, we can use communications and operational strategies to influence it. The strategies must be credible, and they must be of interest to the audience. To influence peoples perceptions, we need to first focus on creating a consistent experience in every interaction they have with us and reinforce that experience with the quality of products and services, the actions and attitudes of leadership and employees, and the way we portray the organization in communicationsboth internally and externally. There are a few important things to keep in mind while managing a brand:  Effective brands are both relevant (to those we interact with) and different (from those they could choose to do business with instead of us).  The best brands closely align the perception they seek to project with the actual customer experience. Consistency is absolutely key.  There is no middle ground. Every time you interact with your target, you either build equity in your brand or you destroy it. That means living a brand, not just promoting it. And the only way to do that

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is by weaving brand building throughout the entire organization, incorporating it into business strategy, product design, customer service even the office environment. Trust creation is a fundamental goal of brand design. And the way we build trust is through consistency: By presenting ourselves consistently and by consistently doing what we say we will.

The Role of the Brand

Some of the most successful branded companies use the brand as their central organizing principle. Richard Bransons determination to give the man in the street a better dealwhether its in financial services, train services or air travelanimates the organization and acts as a filter for corporate development. Not all of Bransons enterprises have been successful (notably Virgin Rail), but he is widely admired for his commitment, enthusiasm and innovation. Fliers with Virgin Atlantic can readily sense the difference; not only is the flight cheaper, but the whole experience is different. It may not be to everyones taste, but the friendliness and informality of the staff reflect the personality of Branson himself. The result is a well-managed customer experience, distinctive and memorable. Having a strong brand enables companies to Align internally around a shared understanding  Provide associates with the necessary tools to communicate the brand consistently Focus and improve customer offerings Differentiate from the competition Compete on quality instead of price or speed Sharpen marketing efforts Focus on growing the business where it really matters

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Final Thoughts
Think about the brands you use and trust. It can be anything from the toothpaste or laundry detergent you use to the car wash or hairdresser you visit to the political party or church you belong to. Think about why you choose these brands and why you dont choose others. Brands are all around us. As we clarify and identify who we are and what we stand for, we strengthen our businesses, build value, and create a more rewarding experience for our customers, our employees, our suppliers, and ourselves.

Rick Cornish is founder, President and Creative Director of Flying Colors Incorporated. Since 1990, the company has created meeting experiences for Fortune 500 companies that measurably influence change in the attitudes of those who attend them. The company has been recognized internationally with over 70 awards.

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Resources
Godin, Seth The Brand Formula (Seth Godins Blog, April 24, 2007) Bates, Colin What is a Brand? (The Sideroad www.sideroad.com) Neumeier, Marty The Brand Gap (New Riders, 2006) Trout, Jack Jack Trout on Strategy (McGraw Hill, 2004) Brand Identity Guru, Inc. What is a Brand? (www.brandidetityguru.com) Synergy Network, Inc. What is a Brand? (www.synergynetwork.com, 2004) Feree, Erin What is a Brand? (www.elf-design.com) Herman Miller, Inc. Three Dimensional Branding (2007) Ries, Al, and Trout, Jack The 22 Immutable Laws of Branding (HarperBusiness, New York, 1998) Travis, Daryl Emotional Branding (Prima Venture, Roseville, Calif., 2000) Salter, Chuck TrendsetterBarry Shepard (Fast Company, November 2001). Annunziato, Lisa Born Identity (Contract August 2002) Aaker, David A. Building Strong Brands (The Free Press, New York, 1996) Pine II, B. Joseph, and James H. Gilmore The Experience Economy (Harvard Business School Press, Boston, 1999) Brands and Branding (Economist Books, 2004) Schultz & Schultz Brand Babble: Sense and Nonsense About Branding (South-Western, 2004)

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