Tag Archives for " MARKETING STRATEGY "

2 retail marketing strategy

Retail Marketing Strategy — Super Sales vs. Super Brands.

BNBranding logoIt’s discount days in the retail world right now. Everywhere you turn there’s a super sale, an inventory reduction, a seasonal clearance event or some other equally banal form of discounting.

retail marketing strategySign of the times, I suppose. With all that pressure from online retailers, brick and mortar store owners are desperate to get people in the door, even if it causes long-term damage to their brand.

But does discounting really hurt your brand?

That’s a question that often leads to heated debates between ad agency folks and their clients. The creatives are quick to condemn anything that involves a price point. But clients want to “move the needle” and “get an immediate ROI” on every advertising dollar. They often claim that any sort of “image” advertising is a waste of time.

Then there’s the agency Account Executive, trying desperately to bring the two sides together in a sort of middle-east peace accord that will save the account for another year. Not a good scenario for a lasting client-agency relationship.

But I digress.

The question is, where does discounting fit into your retail marketing strategy? Does it hurt a brand to run a half-off sale? It depends on the brand and the strategy behind the sale.

So before you hire that sign painter to emblazon your front window with “Everything Must Go!”  ask yourself two questions:

  1. Does the sale or promotion complement your brand promise or contradict it?
  2. Who would the sale appeal to? Are you luring only your best customers, or is a sale a good way to introduce new folks to your brand. And will you ever see those people again?

retail marketing strategyNordstrom has the right answer to both those questions.

When it comes to brand integrity, Nordstrom is the bellwether for the retail industry. It’s a chain known for high prices and bend-over-backward customer service.

Bargains are NOT part of the Nordstrom brand ethos. So yes, frequent discounting would definitely hurt that brand.

If Nordstrom had a Super Bowl sale and a Valentines Day sale and an Easter sale and a Mother’s Day sale and a Father’s Day sale like most department stores, consumers would slowly but surely begin to question the entire premise of the business. They’d begin to doubt Nordstrom’s stature as the industry’s service leader and wonder if the chain compromised the quality of the merchandise.

Might as well go to Macy’s.

So here’s how Nordstrom handles discounting without compromising their brand promise: They only have one store-wide sale a year: The Anniversary sale. (Plus an annual Men’s Sale and an Annual Women’s Sale.)

retail marketing strategyTo manage the inevitable department store inventory challenges and discounting pressure, they opened The Nordstrom Rack. If you like Nordstrom’s outstanding merchandise, but don’t want to pay standard Nordstrom prices for the service, go to the Rack. It’s like a sale all the time. Same stuff, but a totally different shopping experience.

So here’s the final answer: If you have a retail brand that emphasizes customer service and outstanding quality, use discounts very sparingly. Because every sale will send mixed messages to an already skeptical audience.

Contrast that with Wal-Mart. Wal-Mart shoppers aren’t going to Nordstrom for the annual men’s sale. They’re going to Wal-Mart every Saturday where a constant barrage of markdowns is always expected, and perfectly “on brand.”

Wal-Mart’s corporate culture takes frugality to an entirely new level, and it shows up on every isle in every store. Wal-Mart’s brand promise demands big, loud sales, or at least the perception of sale prices all the time. That’s why they have spend more than $800 million a year on advertising… it’s a constant state of “Sale.”

For both Wal-Mart and Nordstrom, the retail marketing strategy delivers on the brand promise. Their sales appeal to core customers as well as those who are looking for a bargain. And there’s a good chance they’ll come back again after the sale.

Unfortunately, most business owners can’t answer the question, “is this sale consistent with your brand promise?” Because they don’t know what their brand promise is. When pressed, they can’t pinpoint what their business is really all about, beyond making their quarterly numbers.

They’ve never thought about it. They’ve never articulated it. And they certainly haven’t communicated it to the public in a clear, compelling, consistent manner. They’re too busy advertising “value.”

The Gallup Organization has done extensive research regarding brand promises and have found that the vast majority are poorly defined and poorly communicated.

retail marketing strategy

Sometimes it takes nerve to resist the “big sale” temptation.

“Rather than attempting to convince a skeptical audience that their brand offers something truly meaningful and distinct, some companies have found it easier just to bribe their prospects (with sales) … Repeat purchases that are driven solely by brand bribery, however, are not the same thing as a brand relationship.”

In other words, sales might increase short-term transactions, but they don’t improve your brand loyalty.

Successful brands like Nordstrom have lasting, loving relationships with their customers, not one-night stands. And the more Amazon pushes its automated, efficient-but-impersonal approach to retail, the more valuable Nordstrom-like service becomes.

So think twice about your retail promotional strategy. If your brand’s promise is to consistently deliver the cheapest goods and services in your category, then go ahead. Run sales every month.

But if your brand promise is to deliver value or service or anything else beyond low price, then find another way to drive traffic.

Your brand will be better for it.

For more on brand strategy, try this post. 

marketing strategy BNBranding

 

 

 

For more on how to differentiate your store without resorting to bribery, try this post. 

Or call us! 541-815-0075

2 Branding firm BNBranding

Restaurant Branding — Recipes for failure and success

BNBranding logoAt what point does a trendy new restaurant become an iconic brand? And when do all the branding efforts under the sun produce nothing but another shuttered dining establishment?

The restaurant business is littered with cases of meteoric success and dramatic failure. It’s an inherently volatile business. This is the story of several competing restaurants in a small but rapidly-growing market. It’s a story of restaurant branding success — and failure  — that any business owner can learn from.

Prior to 2000, the culinary scene in Bend wasn’t much to write home about. Some would say, non existent. So when Merenda opened in 2002 it generated tons of buzz.

Restaurant Branding BNBrandingAs the Bend Bulletin reported, “Chef Jody Denton pioneered a renaissance in fine dining in Central Oregon.”

But the Merenda brand wasn’t about fine dining. It was about partying. It was a loud place in downtown Bend where large groups would gather and drink generously from an outstanding wine list and a good assortment of adult beverages. Not great for a quiet dinner date.

The vibe was more urban — the energy level more electric — than anything previously found in Bend. Many nights you couldn’t hear yourself think, and the bar scene at Merenda became a notorious pick-up joint for older divorcees.

Meanwhile, across town in a nondescript location next to a car dealership, a restaurant called Zydeco quietly began to build a loyal following. The contrast was dramatic.

The first, most fundamental element of any restaurant braning effort is the name.

So let’s compare… What a great name:”Zydeco.”

It’s fantastically memorable with positive associations of fun in New Orleans. It’s authentic. Zydeco served delicious cajun cuisine, which was certainly unique for this town. It’s also an aspirational name that the restaurant has grown into over the last 15 years.

waste in advertising - BNBranding's Brand Insight BlogOn the other hand, “Merenda” just didn’t work as well. It sounds nice and has an elegant, upscale ring to it, but it’s so much softer than the product and the experience. The name didn’t fit the vibe and the location. Plus, if you want to get nit-picky, “Merenda” translates to “snack” in Italian. But it was not an Italian restaurant.

Trendiness seldom translates into a lasting brand.  

Many of Merenda’s customers were only there because it was THE place to see and be seen. It was a superficial relationship, not a genuine bond. Success by association. When new restaurants like Zydeco opened, the crowds thinned out at Merenda.

At Zydeco, it was more than that… It was the service, the friendly, family-owned vibe, and the overall, everyday quality that set it apart. It was upscale, but accessible. Popular but not trendy. It wasn’t trying to be cool, but it was. And still is.

Trendiness is a common problem in restaurant branding, fashion and high tech. The next big thing or hot spot is always right around the corner. So successful brand managers have to find ways to stay relevant with their past customers, or become relevant to a whole new group.

BNBranding use long copy to be authenticRelevance, differentiation and credibility. Those are the three ingredients of restaurant branding success.

After five years Chef Denton got distracted. Just when Merenda neeed a little extra attention he opened another restaurant less than a block away. And his place called Deep never got above water.

Brands need constant attention.

This seems like a no-brainer, but many people dream of having a business that runs on autopilot and generates an endless flow of effortless revenue. That doesn’t work in any industry, much less the restaurant business.

You have to mind the store.

In 2005 Cornell University published a seminal study on why restaurants fail. One of the surprising contributors was simply a lack of attention, time and effort by the owners.

“Failure seemed to stem from an inability or unwillingness to give the business sufficient attention… The immense time commitment was mentioned by all of the survey respondents who had failed.”

restaurant brandingAt Deep, Denton was determined to create something completely different. As he told The Bulletin: “That’s been kind of my business model: finding what Bend doesn’t have and filling that void. I’ve always enjoyed the environment of a sushi bar. It’s always been something appealing, both from the restaurant’s and the chef’s standpoint.”

What he failed to consider was how much attention his other brand required. He was spread too thin and his upscale sushi place was ahead of its time.

Differentiation doesn’t guarantee success in restaurant branding.

Being different from the competition is certainly important, but it’s not everything. Tiny morsels of Kobe beef served on a hot rock for eight dollars a bite… That’s different! “Angry Lobster,” Monkfish paté, grilled yuzu and marinated, chopped maguro tataki were all impressively different, but not appealing enough to inspire repeat business by a large group of people in a relatively small market.

Bottom line: Deep was a high-end sushi place in a meat and potato town.

All successful brands have a clear, well-defined concept that goes beyond the product.

As I have said in previous posts, if you want to build an iconic brand, first own an idea. The Cornell study proved that clarity of concept is essential to restaurant success.

“Perhaps the key finding was the focus on a clear concept that drives all activities… Successful restaurant owners all had a well-defined concept which encompassed an operating philosophy and business operation issues. Failed owners, when asked about their concept, discussed only their food product.”

In other words, successful restaurants have core brand concepts that go beyond just the food.

Denton certainly had vision beyond food for both his restaurants. But the concepts behind Merenda and Deep were based more on Denton’s past experience and personal preference than on the realities of the local market.

There’s an old saying… “If you want to live with the classes, sell to the masses.”

In Denton’s case, his restaurants served the classes. His high-end brands only resonated with a small segment of the population, and he didn’t reinvent Merenda when he needed to.

In the end, Denton’s concept for Merenda was not clear enough to sustain the business over the long haul. (Being first in the market isn’t a sustainable brand strategy for a single restaurant.) And the concept for Deep never had a chance. So both restaurants were shuttered and his investors came away empty handed.

Eventually, Merenda reopened under a new name with a new owner. “800 Wall” never created the buzz of the original, and it’s now cruising along, probably doing fine in the summer, but not exactly inspiring loyalty or write-ups in Gourmet Magazine.

Zydeco, on the other hand, has grown and evolved. When they moved into a larger, fancier location downtown they bought a loyal following with them. It’s now more popular than ever, despite the fact that new restaurants keep popping up around town.

For more on brand strategy, try this post.

If you want help with your restaurant branding, call me.

BNBranding's Brand Insight Blog

4 Truth & Transparency — How one ski area is managing customer’s expectations.

By John Furgurson

Ski area managers live and die by the whims of Mother Nature. Already this winter high winds and heavy ice have toppled trees and wrecked havoc at Mt. Bachelor. Flooded roads cut access to Crystal Mountain. A lift tower at Whistler snapped. A landslide took out a lift at Snoqualmie Pass. And some poor guy at Vail found himself hanging upside down and naked from a chairlift. 

So how do you keep your customers happy through all the drama and mayhem? How do you handle those days that don’t qualify for the chamber of commerce brochure? As Mt. Bachelor has discovered, it’s a matter of managing expectations by educating skiers about mountain operations and reporting the truth in a timely, credible manner. A significant departure from the industry norm.

Ten years ago they could get away with little white lies on the morning ski report. But now cell phones make it hard to pull one over on anyone. The lift ride is plenty of time for skiers to Twitter or send simple, pointed text messages to their friends down in town that either confirm or deny the morning report.

“Is sucks, stay home.”  “It’s Epic. Get up here.” “Fogged in. Can’t see two feet.” With minute-by-minute updates like that, sugar-coated reports from the marketing department just don’t cut it any more.

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Last season Mt. Bachelor suffered a string of PR problems… Unexplained lift closures, safety violations and some questionable policy decisions by the new parent company caused a lot of grumbling in the skiing community. And quite frankly, the Mt. Bachelor brand took a hit. For the first season in 30 years, it slipped to # 2 among Oregon’s ski areas.

So this year a new management team is working hard to improve the overall experience, and that starts by managing expectations.

From what I’ve seen so far, they’re using their website pretty effectively to paint a realistic picture of what it takes to operate a modern ski area on a 9,000-foot Pacific Northwest Volcano. And it’s a lot harder than I ever imagined.

Since the latest storm, they’ve been uploading videos that show what the lift crews are faced with. It’s harder to complain about a lift not opening promptly on time when you’ve seen the manual labor required to do the job… Time lapse photography of an employee climbing up a 40-foot lift tower, tentatively chipping away at ice two feet thick.  Loggers and snow-cat drivers working together to clear 60-foot fir trees from the middle of a run. That’s powerful stuff that I haven’t seen on any other web site or in any other industry.

 

www.youtube.com/watch?v=wlYZUlHzby4

The daily conditions report has also improved dramatically. It’s now updated several times every morning, and it’s written in a first-person, man-on-the-slopes tone. Not only that,  it’s refreshingly truthful. Last week, in the midst of the worst ice storm in 30 years, the author said, “I walked around the base area, and it’s not the kind of day you don’t want to set foot outside. It’s raining hard and it’s below freezing.”

And I love this one from a day in early December when everyone was still praying for the season’s first big dump: “We had nine inches overnight, with high winds. It’s deep in some places, and other spots look just like they did two days ago.”

Now that’s authentic!

The amusement park industry should take note. There’s nothing worse than arriving at a park, with your kids all jacked-up and ready for the latest, greatest roller coaster, only to find the ride closed for some unknown reason.

The golf industry would also benefit from such frank assessments. A detailed superintendant’s report would be tremendously useful in a country club environment where guys have been known to complain about the fairways being TOO perfect. If you show members all the work that goes into keeping all 18 greens rolling at 11 on the stimpmeter, they might not complain as much about miniscule variations in the height of the rough.

But honesty isn’t about shutting up your biggest critics. It’s about cementing a relationship with your best customers and maintaining the goodwill of your brand. Because every time you leave out important information, fudge a bit in a press release, or overstate a marketing claim, you’re chipping away at your credibility. Like ice on a lift tower, eventually it’ll all come crashing down on your head.

 

Curiousity got the best of you? See the unlikely lift ride here: 

www.huffingtonpost.com/2009/01/06/vail-chairlift-accident-l_n_155578.html

 

 

 

 

7 Marketing lessons from GM — Will a $30 billion bailout buy them some focus?

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The top guns of the American auto industry parked their private jets, piled into their big, luxury hybreds, and headed back to Washington last week. The goal: 50 billion dollars in loans, credit and other forms of bailout money. The second installment of what one reporter called, “a long term payment plan in $35 billion installments.”

There’s no doubt GM’s failure would a terrible economic blow. Those jobs would be sorely missed, but would anyone miss the mediocre brands that GM’s been consistently producing for the last 35 years?

I don’t think so. Other than some loyal Chevy truck fans, consumers won’t miss a beat.

GM’s business problems are far reaching and complex. The Wall Street Journal says “it’s a bloated organization with too many dealers and too many factories producing too many cars for the marketplace.” (GM has 7000 dealers in the U.S. Toyota outsells them with just 1500.) The company is burning through cash faster than a Suburban sucks gas — $75 million a day, according to one account. Turning that land yacht around is is going to be much harder than anyone’s predicting. As one consultant said… “Even with a generous series of government loans, GM is likely to go bankrupt within the next two years.”

Let’s face it. GM has been losing ground slowly but surely since muscle cars were killed by the oil embargo of the 1970’s. If congress looks at the situation from a marketing standpoint, they wouldn’t cough up a dime.

According to Automobile magazine, “it’s been 50 years since GM built a car that was the standard of the industry in any category.” Overall, GM products have been poor in all respects, from design and driveability to safety and fuel efficiency.

I believe that GM’s quality issues and their current financial crisis is a direct reflection Alfred P. Sloan’s famous, flawed strategy of “a car for every purse and purpose.” Sorry, but quantity over quality just doesn’t work in the modern automotive industry.

GM’s business model for the past 30 years has been built around the assumption that they can keep making money off products that are unremarkable, at best. But even when you’re as big as GM, you can’t be all things to all people. Over time, that lack of focus is going to kill you.

Look at GM’s track record in the small-car market. First they had the Chevette and the notorious Vega, a car reknown for being the first aluminum block engine ever produced… (not exactly the type of innovation that propels a company into a new era.)

While Honda, Toyota and Nissan were dominating that market in the 80’s, GM introduced The X-cars… the Citation, Omega, Phoenix and Skylark. Yikes! Those weren’t economy cars, they were just awful, underpowered sedans.

GM fumbled around for 20 years trying to build a small car under the wrong brand: Cadillac. Remember the Cimmeron? It’s on Time Magazine’s list of the worst cars ever built. And the Catera, “the caddy that zigs.” The advertising was unbelievable and the product, unbelievably bad. For consumers, a small, sporty Cadillac just doesn’t compute.

Then there was Saturn, GM’s great hope of 1990. Nothing in the history of GM could match the enormity of this brand’s launch. They built a state-of-the-art manufacturing plant in Springhill Tennessee. They opened a new dealer network and adopted innovative new marketing and customer service programs, including a policy of “no haggle pricing.” To their credit, they did everything differently in order to compete with the Japanese.

Despite the plastic body panels, Saturn succeeded for a while. The cars were affordable, and they even won some industry accolades in the subcompact category. Unfortunately, GM starved that division of cash, kept them from launching new products for 10 years, and now is contemplating a shutdown of that brand.

So they can’t compete in the small car market. But what about GM’s bread and butter categories, like vanilla-flavored sedans? Unfortunately, they’ve even been losing on that front as well. The Ford Taurus was the best-selling car in the country for years, followed by the domestically produced Toyota Camry. In the meantime, The Oldsmobile brand limped along for years before GM execs finally pulled the plug in 1999. They tried all sorts of marketing ploys to save it, including more than a dozen different slogans for the brand over a 15 year period. They did everything BUT build a car that appealed to anyone.

GM missed the boat entirely on the minivan craze, and they were slow to market with their SUVs. (But no one will deny the success of the Suburban.) GM actually had the lead in green technology in the late 90’s with the EV1 electric car, but they pulled the plug on that for short-term financial reasons. Now, while the Toyota Prius flies out of showrooms, GM’s playing catch-up yet again with the Chevy Volt. The volt is not a hybred. It’s actually an electric car, leaps ahead of Toyota in the green car game. It plugs in and it looks racy too, but it might be too late to the starting line.

Clearly, GM has been all over the place strategically. Now it looks like the bailout will force them to focus their efforts a bit. There’s already talk of paring the product line-up, and in the recent Senate hearings GM execs said their new strategy is “to focus available resources and growth strategies on the companies profitable operations.”

I guess that means four core brands… Chevy, Buick, GMC and Cadillac. And potentially four more marketing failures: Pontiac, Saab, Saturn and the king of them all, Hummer. (Don’t even get me started on that.)

Even with the forced focus on just four brands, GM will have a difficult time turning a profit. According to Automobile Magazine, the Cadillac CTS is actually one of GM’s small glimmers of hope for something better down the road. “It’s not relevant at $60k, but it’s a reminder that GM knows how to build a very special automobile. It’s the pride of Lansing Michigan and proof positive that GM has a lively pulse.”

Hmmmm. How can a car be “not relevant” in the market, but hopeful? And why does the mainstream press assume that GM will suddenly “start building fuel efficient cars that people want to buy” as soon as this bailout comes through? They haven’t done it yet. And no marketing blitz or government bailout can turn a lousy product into a branding success.

There’s an old saying in advertising circles… “great advertising just kills a bad product faster.” Sadly, GM’s history is littered with products that died fast, deserving deaths.

8 Scott Bedbury brand insight blog

Living The Brand, Scott Bedbury Style.

In branding circles, Scott Bedbury is kind of famous… He worked at Nike during the “Just Do It” years. Helped Howard Shultz build the Starbucks brand. And now he consults with a few lucky businesses and does speaking engagements all over the world. Even Kazakstan. Nice!

Scott Bedbury brand insight blogBedbury’s a very genuine guy, which is good, because that’s part of his branding mantra; the importance of being genuine.

These days, you can’t get away with being disingenuous. Some blogger, somewhere, will call you on it faster than you can say, “Where the hell’s our PR firm?” As Bedbury said, “the days of the corporate comb-over are gone.”

The brand assessment work we do is designed to reveal the truth behind a brand, not a well-polished corporate version of it. But some companies don’t like looking in the mirror. They aren’t forthcoming with the comb-overs and other cosmetic improvements because the genuine attributes of their brand just aren’t pretty.

I’ve seen plenty of cases where a company’s internal perception of the brand doesn’t jive with the consumer’s reality. If that’s the case, your branding efforts will have to reach much deeper than just the marketing department. You’ll actually have to change the product, tweak the operation or hire a different team. Because “everything matters.”

bend oregon advertising agency BNBrandingIt’s nice to hear that Bedbury’s donating his talent for good causes. As he says, great brands use their superhuman powers for good and place people and principles before profits. “Give a damn, and give back,” to be exact.

Patagonia is a company that gives a damn. There’s nothing fake about Yvonne Chouinard’s dedication to environmental causes, and it shows in everything the company does. The Patagonia brand, the operation and the products are aligned perfectly around a single, unifying idea… Save the environment so we can all enjoy the outdoors.

Unfortunately, few companies are as focused or philanthropic as Patagonia. Several business plans came across my desk in the past week, and it reminds me why Bedbury’s branding message is so important. All too often, the startup is only about cashing out. Nothing else.

Jim Collins, author of Built To Last, has something to say about that: ” The entrepreneurial mind-set has degenerated from one of risk, contribution, and reward to one of wealth entitlement. I developed our business model on the idea of creating an enduring, great company — just as I was taught to do at Stanford — and the VCs looked at me as if I were crazy. They’re not interested in enduring, great companies, just an idea that you can do quickly and take public or get acquired within 12 to 18 months. “

Anyway, even if you don’t have a great company that donates a portion of your profits like Patagonia does, you should still have a cause that drives your operation. You need a purpose the employees can rally around… something more meaningful than just boosting the stock price.

Scott Bedbury’s boss at Nike, Phil Knight, was adamantly against his employees watching the stock price. When Bedbury got to Starbucks it was posted by the hour, up on a bulletin board for everyone to see. Not sure if Bedbury was able to change that practice or not, but it never sat well with him. He’d rather think long term.

Another thing about Bedbury is that he can still laugh at himself. (Or at least he could the last time I saw him speak in Bend, Oregon.) Again, he’s following his own advice. An amusing anecdote and an easy chuckle are perfectly “on brand” for Scott Bedbury.

oregon advertising agency BNBranding shares Scott Bedbury quoteHe’s not the type of guy you’d find as a Chief Marketing Officer at a Fortune 500 company, that’s for sure. He’s more storyteller than suit.

Storytelling is a big part of branding. Once you’ve figured out the real crux of your brand, you have to communicate it in a form that people can understand. And nothing is more effective than a good, old-fashioned story. Doesn’t matter if it’s delivered via the latest, greatest mobile technology, it’s still just a story. Tell it well. Tell it often. And keep it real.

One last piece of advice, inspired by Scott Bedbury… Don’t be afraid to reinvent your brand from time to time. Every summer he “shuts it down,” and hangs out with his family in Central Oregon. He writes, plays a little golf and recharges the batteries. So his own, personal brand will be fresh and ready for the next, big brand adventure.

For more insight on brand stories and similar case studies, try THIS post. 

6 classic positioning strategy

Positioning — It’s not what you SAY. It’s what they THINK.

BNBranding logoIn the 1970’s Al Ries and Jack Trout popularized the concept of positioning strategy. Since then, they’ve written dozens of spin-off books, including Focus, The Immutable Laws of Marketing, Bottom Up Marketing, and even Re-Positioning.

positioning strategyStill, you could have a roomful of MBA’s and no two would agree on what positioning really means. Many people can’t even decide if the word is an active verb or a proper noun.

Most people think of positioning as a simple step ladder. The cheapest, lowest-end products are “positioned” at the bottom of the ladder, and the best, most expensive products are on the top shelf, if you will.

But positioning has little to do with real price or quality. Instead, it’s all about perception.

The whole concept of positioning is based on the simple fact that we form opinions about products and companies based on our own perception. These opinions are influenced by all sorts of things… word of mouth, personal experience, individual prejudices, blogs, the marketing efforts of the brand in question and a hundred other factors.

In our own minds we make some pretty broad — and often rash — assumptions about things. Call it consumer bigotry if you want to. The fact is, we pigeon hole companies and products the same way we pigeon hole political candidates.

As marketers, our goal is to tap into these existing perceptions and use them to our advantage.

Here’s a classic example. Back in 1968, before the term positioning was ever invented, the makers of 7-Up scored a huge coup in the soft drink market.

Taste tests and other forms of consumer research revealed that people saw 7-Up as a refreshing alternative to colas. Respondents said it flat out… “it’s a nice change from all the cola I’ve been drinking.”

So the 7-Up executives decided to market the drink as the alternative to cola. It was a no-brainer, really. They simply took the existing perception in the marketplace and turned it into their strategy.

Like all good positioning strategies, 7Up’s was simple and almost painfully obvious. Once the executives at 7-Up knew what consumers were thinking, there was no other way to go.

classic positioning strategyThe creative execution of the strategy, however, was not so obvious.

J. Walter Thompson’s simple two-word slogan “The UnCola” said it all. Brilliant! The campaign gave the product a personality, cemented the idea in our collective consciousness, and assured 7Up a place in advertising history.

From a positioning standpoint this strategy worked remarkably well for several reasons. First, it didn’t attempt to change anyone’s perception. It simply leveraged the existing public opinion.

Secondly, it effectively repositioned the competition. Without slamming them, 7-Up lumped Coke, Pepsi and RC all together in a single boring category of colas.

classic positioning strategyFinally, the new strategy made 7Up relevant to the young people who account for a large portion of soft drink sales. The campaign tapped into the prevalent anti-establishment mind set of the late 60’s. It actively encouraged defiance against the cola establishment and portrayed 7-Up as a symbol of dissent. The entire campaign summarized the popular values of the public and catapulted 7-Up into the position as the third leading soft drink in America.

While it is possible to build a positioning strategy around images alone, it’s usually a few simple words like “The Uncola” that solidify things in the consumer’s mind. Because you don’t “position” a product, you communicate its position.

“Just Do It” communicates Nike’s position as a brand of everyday athletes. “Pizza Pizza” is a fun way to communicate Little Ceasar’s low-price strategy. “Avis, we try harder” communicated the benefit of being number two in the rental car business.

On the other hand, many automobile companies have struggled with their positioning strategy. Oldsmobile, the now defunct GM brand, is a good example.

automotive marketing positioning strategyIn its last 14 years, Oldsmobile floated no fewer than ten different slogans. Here’s a few of the real gems:

“Olds Quality. Feel it.”

“Demand Better.”

“Look what happens when you demand better.”

“Defy Convention.”

“It knows the road.”

Ironically, the slogan that’s most memorable is the only one that even hints at the reality of Oldsmobile’s perception with American car buyers. “This is not your father’s Olds” used the old, fuddy-duddy perception of Oldsmobile and spun it in a positive way. Maybe if they’d have stuck with it for more than a year, the brand would still be alive today.

You wonder what kind of research Cadillac executives did that led them to believe they could compete with Honda and Toyota in the small car market. The Cimmeron failed miserably back in the 80’s. Then they’re tried again in the 90’s with Caterra, “The Caddi that zigs.”  Nobody believed that!

Now they’re trying to compete against BMW, Audi and Mercedez. GM finally got the product right with the CTS, but it’s still a classic case of force-feeding a product into a position in the market. Cadillac as a sports car just does not compute with the American public. It goes against everything Cadillac has ever stood for. The world’s biggest, most luxurious SUV is one thing, but we’ll never buy the concept of a small, sporty Cadillac.

On the same vein, Porsche is off track trying to compete in the SUV market. “The Porsche of SUV’s”  has a nice ring to it, but it will never really resonate with the public that sees Porsche as a rich-man’s sports car. What’s next, Chateaubriand at McDonald’s?

There’s an important distinction to be made here between niche marketing and positioning. Cadillac can decide to focus on the luxury sports car niche and can build a car specifically for that purpose. But that does not mean the product will ever be perceived that way in the minds of the consumer. The problem is, Audi and BMW already occupy that space in the consumer’s mind.

positioning strategy BNBranding

Here’s another trap that many companies fall into: They mistake their mission statement for a positioning strategy.

Fortune-500 companies miss the boat all the time on this. There’s a giant health care provider that recently formed an internal committee to study the “position” of the company and draft a “positioning strategy.” What they came up with was a mission statement at best.

But your mission — your statement of purpose — may have nothing to do with your position in the market place. And vice versa.

A mission statement is concocted by a committee and exists in corporate brochures, annual reports, and press releases. A positioning statement is formed in the consumer’s mind. A mission statement is the rose-colored view of your company. A positioning statement is the gritty, 16mm view.

No doubt, the semantics of positioning and positioning strategy can get confusing. But if you want to hedge your bets, think of it this way:

Positioning is not something you do, it’s something that happens. You can choose a narrow market niche, devise a new pricing strategy and launch a giant ad campaign that, together, may affect people’s perception of you. But you can’t technically “position” anything.

Want to transform your business into an iconic brand like 7-Up? Call us. 541-815-0075. Want more classic positioning advice? Read this post.

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saying no in business

Just say “NO.” How to build your business by bowing out gracefully.

BNBranding logoSaying no in business is one of the most difficult yet liberating things you can do. You might want to practice at home, with your kids.

The most effective managers and executives say no a lot.

For instance, they politely decline to pursue business that doesn’t fit their strategic objectives. They say no to employees who try to hijack their time. They don’t tolerate overblown financial projections and long, drawn-out presentations. They say no to new initiatives that don’t fit the brand or the corporate culture.

They even say no to their bosses and to their best clients sometimes.

The typical small-business owner, on the other hand, says yes, yes, yes to anything that comes along. Turning down work is just not part of the program. So in an effort to grow the business and put food on the table, they make a habit of appeasing people. 

Say no to build your business BNBranding“Sure, we can do that.”  Yes, we can do that too.”

It’s a particularly common problem in professional service firms. Because after all, it IS a service business. We serve our clients. We aim to please.

An overly agreeable approach isn’t just a lack of courage. It’s often symptomatic of two glaring managerial shortcomings: little or no strategic thinking and a brand that’s not very focused or well defined.

Defining a Brand Strategy means choosing a specialty, setting specific goals, and turning away business that doesn’t fit with your core brand values. If you don’t say no in business, you’ll never have an iconic brand.

The clarity that comes from a well-defined, well written brand strategy makes it much easier to say no when you really need to.

When Steve Jobs returned to Apple in 1997 the company was, in his own words, “in deep shit.” They had at least 13 new initiatives and product ideas but no direction. No strategic focus. No “gravitational pull,” as he put it.

Jobs killed all but two of the initiatives. One was the iMac and the other was the G4. By saying no, he set the company in a specific, definable direction that’s still paying off today.

BNBranding's brand insight blog“Companies sometimes forget who they are.” Jobs once said. “Fortunately, we woke up. And now we’re on a really good track. It comes from saying no to 1,000 things to make sure we don’t get on the wrong track or try to do too much. We’re always thinking about new markets we could enter, but it’s only by saying no that you can concentrate on the things that are really important.” *

Say no in business to 1,000 things — in order to get one thing really right.

Peter Drucker believes the only people who truly get anything done are monomaniacs – people who are intensely focused on one thing at a time. “The more you take on, the greater chance you will lose effectiveness in all aspects of your life.”

Best-selling author Ken Blanchard, (The One-Minute Manager, Gung Ho) says without clear goals you will quickly be a victim of too many commitments. “You will have no framework in which to make decisions about where you should or shouldn’t focus your energy.”

So I guess modern day multi-tasking isn’t the shortest route to success.

Mahatma Gandhi said, “A ‘no’ uttered from deepest conviction is better and greater than a ‘yes’ merely uttered to please, or what is worse, to avoid trouble.”

As a Creative Director I say no a lot. Clients often make impossible requests at the 11th hour or float their own “creative” ideas in early strategy meetings. Sometimes, I swear, they’re just trying to get a rise outta me. Deep down they know their ideas are lame, but they want to see how I handle it.

Here are some good things that come from saying no in business:

• You have more opportunities to say yes to the right customers, at the right time. You can pick your battles. 

• You have more time to focus on more important tasks, like long-term planning, strategic thinking and branding.

• Your operation will become more streamlined and efficient. 

• You’ll have a better sense of balance in life — between work, home and play.

• Saying “no” expresses how you really feel. You’re not hiding anything, and you’re taking responsibility for your own feelings. It’s more authentic than a forced “yes.” 

• Saying no actually increases your value in the market niche you’ve choosen.

truth in advertising BNBranding

At BNBranding one of the goals of our new business development effort is to say no more often. And not just to accounts that are too small, but also to businesses owners, marketing managers and entrepreneurs who might pay well, but don’t share our core values.

As the old saying goes, “values mean nothing in business until they cost you money.”

We need more work, but not just any work. Work that we’re proud to show off.

We need clients, but not just any clients. We need clients who we’re genuinely happy to help, and are honestly grateful for it.

Fast Company magazine ran a great article about Jim Wier, the CEO of Snapper lawn mowers. He said no in business. In fact, he said no to Walmart and gave up tens of millions of dollars in annual sales with one visit to Arkansas. But he was adamant that selling Snapper mowers through Walmart stores was incompatible with their strategy and their brand.

Now that’s courage. And focus.

Most large companies with a well-respected brand like Snapper would be tempted to launch a line extension strategy to accommodate Walmart. Just produce a cheaper mower overseas and slap the Snapper name on it. But Wier knew that would just dilute the brand and confuse people.

saying no in businessLike when Subway recently announced they’d be test marketing pizzas. How does that fit with their “eat fresh” healthy fast food strategy? Can you see Jared, the Subway spokesperson, losing 60 pounds while eating pizza?  I don’t think so.

Someone should have stepped up and said no to that idea.

For more on establishing a clear brand strategy, try this post.

If you need some help establishing a clear marketing strategy, and executing it, give us a call. We might say no, but we might not. 541-815-0075.

* The Steve Jobs story is from “The Perfect Pitcth” by Jon Steele.  BNBranding  branding services, advertising agency marketing management. in Bend, Oregon.

BNBranding's Brand Insight Blog