Brands Are Dying; Deal With It

In my presentation at Adaptive Path’s Mx Conference earlier this week, I mentioned that brands are dying. This turned out to have more of an impact than I thought. Helen Walters from BusinessWeek (who was in the audience) ended up interviewing me and posting a video of our conversation on her blog.

Why did I say it?

I often discuss Experience-Based Differentiation (EBD), a blueprint for customer experience excellence, in my blog (and in every other forum where people will listen). In my research, I track how large companies progress towards EBD. It turns out that they’ve actually regressed when it comes to the second principle of EBD: “Reinforce the brand with every interaction, not just communications.” Here’s one of the data points from surveys of large North American firms:

brandchart2_vsmall

Why are brands dying?

It’s simple: Companies have let profits replace purpose. As firms optimize left-brain management techniques for squeezing out additional profits, they’ve lost something very important — their raison d’être. True brands are more than just marketing slogans, they’re the fabric that aligns all employees with customers in the pursuit of a common cause.

This quote from Mohatma Gandhi gives insight into how companies should think about their brands:

All compromise is based on give and take, but there can be no give and take on fundamentals. Any compromise on mere fundamentals is a surrender. For it is all give and no take.

The bottom line: Don’t let your brand slip away.

About Bruce Temkin
I am a customer experience transformist, helping large organizations improve business results by changing how they deal with customers. As part of this focus, I examine strategy, marketing, interaction design, customer service, and leadership practices. I am also a fanatical student of business, so this blog provides an outlet for sharing insights from my ongoing educational journey. Simply put, I am passionate about spotting emerging best practices and helping companies master them. And, as many people know, I love to speak about these topics in almost any forum. My “title” is Managing Partner of the Temkin Group, a customer experience research and consulting firm that helps organizations become more customer-centric. Our goal is simple: accelerate the path to delighting customers. I am also the co-founder and chair of the Customer Experience Professionals Association (CXPA.org), a non-profit organization dedicated to the success of CX professionals.

19 Responses to Brands Are Dying; Deal With It

  1. Sad but true. Although, I would venture to say (even though I don’t have Forrester’s research behind me:) that average and poor brands have gotten worse with cut-backs. But top-notch brands are probably still on top. Locally, we have Jordan’s Furniture. Nationally, Apple. I think the brand leaders who built their businesses around high quality merchandise and solid customer service are still running on the same fundamentals. But alas, I’m afraid there’s no hope for Frigidaire. But that’s another story.

  2. Sid Watal says:

    All successful companies do all they can to re-enforce the brand every chance they get. The aforementioned example of Apple is perfect. Google does it really well too. If you establish your brand with every product and every interaction you create “fanboys” that will buy what you want them to buy and hear what you want them to hear.

  3. Bruce Temkin says:

    I’m not sure I’ve heard Apple and Jordan’s Furniture in the same context, but they are both great examples, as is Google. There are defiinitely some companies that are doing a nice job with their brands, so all is not lost.. Hopefully my observation is a wake-up call, not the playing of taps, for the future of brands!

  4. tjcnyc says:

    I have spent my career in advertising, and am very aware of how powerful it can be.

    But, brands are like people: they earn their reputations by what they ARE, not by what they SAY they are.

    We must not confuse “brands” with “branding”. They are emphatically not the same thing.

    The product or service itself must shoulder the major burden: in other words, it must deliver at least 90% of the value creation.

    For example, the advertising for Apple’s iPod is creative and extremely well done. But we are making a mistake if we think that alone is where the “brand” comes from. At least 90% of the brand value is created from the radical ease-of-use of the software, the seamless integration with the app store and iTunes, and the overall gestalt of the product.

    A temptation in marketing is to fixate on managing the communications. It’s easy to understand why. We know it can deliver magic at times. And, it is satisfying: in a single meeting it’s possible to torture a tagline or visual or rough cut and feel that we have made important changes. It lets everyone feel like a creative genius.

    By contrast, making great products or services (especially in mature companies) is difficult. It requires months or years of insight, collaboration, compromise, cost-management, etc etc. More than that, it takes a champion in the process who can inspire his or her company to make something that is different and distinctive. It can seem impossible. But, that’s the job.

    Great marketers — Steve Jobs among them — focus on getting the product right. This is because they know that great products and services, more than anything else, are the foundation of great brands.

  5. As I was sending this to a friend I realized that brands aren’t dying – that would say to me that outside influences are forcing their demise. A more appropriate title of this post should be more along the lines of “Brands are committing suicide.”.

  6. Great post!

    I agree what’s going on is a suicidal inclination on the part of brands. And while those in charge almost certainly will reject the “beancounter” label, there is some truth to it.

    Among other things, a brand is a relationship–not just a transaction. And the shorter and shorter the timeframe considered, the more we view things as transactions, not relationships.

    The so-called “best practices” in American business today are perniciously short-term in nature. They focus on behavioral definitions of goals and objectives, and on tying them into shorter and shorter metrics, to which incentives can then be attached.

    The concept of brand-as-relationship simply cannot be seriously entertained by someone who is told, over and over in a hundred ways, to focus on behaviors, daily/weekly/quarterly numbers, quotas, decimalized customer-sat scores, and the like.

    What happens is people end up focusing on the numbers, and not just the quarterly financials: it’s also the same-store comparisons, the NPS data, the smile-score ratings, and so forth. Numbers are extremely useful to management, but management by numbers alone inherently drives to the non-personal and the short term. That is incompatible with branding.

    “If you can’t measure it, you can’t manage it” is the mantra. A moment’s reflection will show it’s patently false. There are dozens of ways to manage without measurement–fear, love, example, passion, values are just a few. In any case, it’s not the measurement of the short term that is the problem, it’s the management by those short term measurements that is the issue. Yet that’s what gets taught as “best practices” these days.

    So if brands are committing suicide, then their Dr. Kevorkian assistance is coming from Stanford Business School, exec ed programs, BusinessWeek, and the major consultancies.

    • Bruce Temkin says:

      Charles: Great comment. “Relationship” is a great word to use here. Brands are not just one way utterances of catchy phrases and empty promises. They are about forming a connection between the company (and its employees) and its customers. As for who’s to blame, I think you picked out “types” of institutions that are definitely part of the problem, but I wouldn’t lay all of the blame on those specific institutions.

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  14. James Branson says:

    In the larger context I can’t help but wonder to what degree and with what level of enthusiasm are companies embracing the idea of EBD? I know you can cite a significant % of companies who say that the customer is important and or that they want to use the customer experience to differentiate themselves, but what companies can we point to that are actually taking actions in that direction? Have they reported any quantifiable success?

    • Bruce Temkin says:

      James: Great question. It’s hard to isolate the business impact of any indivudal effort within a firm, but more and more companies are starting to calculate the value of customer experience. I have seen a number of firms do the analysis internally, but many of them are not talking about it yet. I’ll be looking to discuss this more in my research later in the year.

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