Branding or Unique Value Proposition?

It’s now all too easy to make quite a lot of noise about some new product or service offering using any of the powerful PR media available in the 21st century (Internet, satellite TV...e.t.c.). It’s also quite hard to distinguish at first glance amongst the numerous options available on the shelf today. Name it! Whatever service/product you need, you’ve got several options and sometimes, you simply get confused.

However, experienced customers seem to always know their way around. Offer them 20 000 different brands of the same generic product, but believe me, they’ll pick just the perfect one (that offers relatively the most value for money). How they do it might be confounding to a newbie, but like they say, experience certainly could have proven to be the best teacher.

I’ve posted an article here that clearly substantiates the fact that no matter how hard you try to market an inferior product/service, you eventually would loose out ‘cause your customers would always find out, and possibly never forgive you when they do!

Please check out what Dr. Harari (leading strategist) has to say in one of his thought provoking write-ups.

What makes brands great is not their visibility, nor their celebrity endorsements, nor the marketing pizzazz behind them. Remember, during the 1990’s Nike and McDonald’s lost a lot of their sheen (and stock value), despite their heavy promotional strategies and the ubiquity (and near 100% recognizability) of the swoosh and the Golden Arches. Only when both companies revamped their product lines did the swoosh and arches generate a positive halo. Don’t mistake presence and recognizability for corporate vitality.

Nowadays, Levi Strauss and Coke are struggling, and as I’ve explained elsewhere (see http://www.ftpress.com/articles/article.aspx?p=1180989), Starbucks' buzz and market cap have fallen—but everybody recognizes the brands. Regardless of whether you’re in the business-to-consumer or business-to-business space, a vendor’s brand flourishes when customers can trust the vendor to provide them with a special experience and constantly evolving great products. With that excellent foundation, judicious imaginative marketing can certainly fan the flames of exposure (think Toyota and Pixar, for example) , but on its own, marketing does not make a great profitable growing brand. (And think about the fact that there are many companies, like Google and retailer Zara and tube fitting manufacturer Swagelok, which build a healthy brand solely around their unique value proposition and do practically no conventional advertising).

Tom Peters says that a brand “is a promise of the value you’ll receive.” In that spirit, I sometimes urge my clients to think about a new “P/E multiple”, one that supplements the traditional “price/earnings” metric. Think about a “Promise/Experience” metric. If, in effect, you can implicitly (not via sexy ads, but in the way you run your business) promise the marketplace that you will churn out a cool, special value in products and services-- and then actually deliver it in a way that generates a really desirable experience for the customer--the payoff in customer and investor loyalty is a genuine multiple. That’s what they do at Toyota, Pixar, Google, Zara and Swagelok, among many others. Put simply, the way to build a break-from-the-pack brand is not by public relations campaigns, ad rollouts, logos, color schemes, viral marketing, etc. etc. Those can definitely help if you’ve got the basics down.

And what are the basics? The capacity to demonstrate to the marketplace that your organization will consistently, reliably, efficiently, authentically, and quickly deliver on great things that are implicitly promised in your business model. Retired Atlanticare CEO George Lynn used to tell me that from his perspective as a hospital CEO or an individual customer—the value of any organization he buys from must be “pervasive, relevant, and credible.” Once again, it all boils down to this: Can I count on this vendor to provide me with special value that truly matters to me?