11 things you have to get right to successfully rebrand.

11 things you have to get right to successfully rebrand.

May 13, 2019 | Branding, Marketing

Rebranding an enterprise is fraught with risk.

You risk losing the brand identity you have, along with current customers, distribution channels, recognition, and so on, banking on building a larger brand in the future.

It will not happen without significant risk and cost.

Let’s get the definition of ‘rebrand’ right.

We are  not talking about a simple pack change here, but a ‘clean sheet of paper’ rebrand.

A seemingly simple pack change is hard enough, but pales into insignificance against a total rebrand, which goes to the core of the value delivered by the brand to its customers.

Years ago I was tasked to rebrand a well known albeit small FMCG brand, ‘Tandaco’. It had in its portfolio several ingredient products used by serious and traditional cooks,  suet,  yeast,  stuffing mix and breadcrumbs. The task was to rebrand into a new brand ‘Supercook,’ which had a wider range of products that were intended to be licenced from the UK.

Having previously been badly bitten by what appeared to be a simple repackaging exercise on Tandaco Stuffing Mix, told in this post,  I was very wary of the larger exercise. While I opposed the whole exercise, as I failed to see any additional value for consumers, and considerable risk, I was convinced I had done everything humanly possible to make it work.

I set out to do this ‘by the numbers,’ to ensure as far as possible that mistakes previously made were not repeated. It was the early eighties, so market research was ‘clunky’ at best, and by comparison to today, positively prehistoric. Nevertheless, there was a lot of research done aimed at addressing what I saw as the stumbling blocks;

  • How did we translate the positive feelings of that small group of current buyers of Tandaco to the new brand Supercook?
  • How did we ensure that the new brand was not left on the shelf due to non recognition, repeating the mistake made previously with the redesign of the stuffing mix, noted above.
  • What brand takeaway did we want to attach to the new Supercook brand?
  • Which additional products could be fitted under the umbrella, that would add to the total volumes of that particular sub category in supermarkets? There were some expectations here based on the British experience, but it seemed to me that potential range extensions were going to have to take share from an existing product, as category expansion seemed unlikely.
  • What was the profile of the key group of purchasers who made up the bulk of the volume currently, and would they ‘stick’ when the new brand was introduced? Indeed, would they buy some of the range  extensions in preference to the existing competition, and why?
  • How would the brand change impact on consumers, how did it add any value to them. My view, expressed probably too loudly for the relatively junior person I was at the time, was that the whole exercise was driven by someone in an office who had a good idea one morning, and no engagement in the marketplace.

There were also marketing management challenges that had to be addressed.

  • Designers and advertising creative personnel needed to be thoroughly briefed and on board with the strategies, reasons for the change, and what we sought to achieve
  • Internal management record keeping from the accounting, through the production management and procurement processes needed to be keyed into the changeover timetables, and accommodating of record changes and allowances made for the inevitable one off changeover costs that would emerge.
  • Sales personnel and importantly customer , supermarket buyers needed similar timetables.
  • Most importantly, consumers had to be informed and engaged in the new brand as it was rolled out.
  • Was there enough budget to do all of the above?

While I believed at the time I had crossed every ‘t’ and dotted every ‘I,’ the change turned out to be a silly idea, and was reversed a couple of years later, after my departure.

At the time of the change, Cerebos was owned by British Multinational RHM, which had slowly bought up the Australian owned businesses over a period of years, and had global aspirations. It has since been passed around like a parcel at a 5 year olds birthday party. The current owner being Kraft Heinz, who acquired it at the beginning of 2018 from Japanese brewer Suntory.  Given the recent disastrous performance by Kraft Heinz, Cerebos is most likely back on the market as Kraft Heinz scrambles to improve their  balance sheet.

A final word of caution. I have seen a ‘rebrand’ become the excuse for all sorts of other changes, not associated with adding value to customers. These are to be avoided at any cost.

 

 

 

What does marketing to Supermarkets and Pharmaceutical research have in common?

What does marketing to Supermarkets and Pharmaceutical research have in common?

Mar 13, 2019 | Branding, Governance, Marketing, retail

Quantifying the ROI of marketing investments remains the single most challenging task of marketers. While marketing costs  remain being seen as a variable expense, stuck in the monthly P&L , it will remain hostage to the whims of expediency, corporate politics, and short term thinking. The real KPI of marketing investment should be the sustainable margin delivered over a considerable time, as you would with an investment in machinery.

The obvious problem is that you can measure the output and productivity improvements associated with a piece of machinery, the numbers become available with use, although, they are all in the past. Marketing investment is all about influencing the future, and measurement, even with the benefit of hindsight is very hard, and useful only as a learning tool.

Is there something we marketers can learn from elsewhere?

The  Kaplan Meier curve is a basic concept used all the time by medical and pharmaceutical researchers. For example, if they are testing a new drug for say, patients with diagnosed terminal prostate cancer, you plot on a daily curve the lifespan of those on the test drug, and those on the placebo.

Assuming there are 100 patients in the trial, at day 1, all 100 are alive, then  you plot the numbers who remain alive daily with, and without the drug. If the plot line of those with the drug goes above the line of those without, you can imply the outcome of longer life, and you have some numbers to support the conclusion. If the line of those on the drug dips below the placebo line, you are killing patients. Lines that stay together indicate the drug has no impact.

Simple idea, widely used in medical research.

For years I have watched suppliers to supermarkets being screwed by those supermarkets, and increasingly allocating advertising funds aimed at brand building , which delivers margins over time to the brand owners, and indirectly despite the protestations to the contrary, to the retailers. This reallocation of advertising to working capital and margin via in store promotional activities, and supermarket profitability, at the expense of advertising, has been a huge mistake.

It has seen the demise of some great brands. To be fair however, consumers have benefitted by cheaper prices, at the expense of choice.

A few weeks ago,  the recently merged businesses of Kraft and Heinz, announced a disastrous profit result. This came about as progressively brand advertising that gave consumers confidence in the  brands has been redirected to price promotion that is the primary competitive tool of supermarkets. Meanwhile, those  same retailers have introduced house brands that look very similar, and that trade off the value proposition developed by Heinz and Kraft over many years.

The same thing has happened in Australia, perhaps more so given the concentration of supermarket retailing.

I was around as a junior product manager in the early  days of Meadow Lea brand building, at what was then Vegetable Oils Pty Ltd, a long gone business, swallowed up by corporate stupidity.

 ‘You ought to be congratulated’ is one of the great propositions of Australian brand building. In a hugely crowded margarine market, Meadow Lea held at its height, a 23% percent market share at premium prices, four times that of its closest rival. This was a direct outcome of a good product, great advertising, and a brand that delivered.

I had a look in a supermarket yesterday, and had trouble finding anything labelled Meadow Lea.

What happened?

Retailer power happened, combined with the lack of  understanding of the power of great brand building consumer propositions by retailers. Meadow Lea was squeezed by retailers for more and more promotional dollars that ended up  being funded by reductions in the brand advertising and building activity, with the end result that the brand in effect no longer exists.

It has become nothing more than a label!

I wonder where the  next market building initiative will come from?

Certainly not from the manufacturers, as they know that immediately they create a market the retailers will undermine it with cheap versions, so there is no value in the risks involved in the innovation necessary, and no reward.

Back to where I started, and I do not have the data for this, but I bet that applying a Kaplan Meier analysis to  the delivered margin from Meadow Lea over time, both to the now owners of the brand, and the retailers, would show that the allocation of brand activity to the low prices demanded by retailers had hurt everybody concerned, including consumers.

Image credit: Wikipedia

 

 

‘Brand Conversations’ are usually just a marketers wet dream.

‘Brand Conversations’ are usually just a marketers wet dream.

Feb 20, 2019 | Branding, Customers, Marketing

 

Brand loyalty and frequency of purchase,  are not the same thing, although we seem to act most often as if they were.

Sometimes we marketers believe our own bullshit, not recognising we are usually delusional, or at least subject to a severe case of confirmation bias.

When was the last time you actually came across a customer who was so loyal, they wanted to ‘have a conversation’ with your brand?

Perhaps they were just shopping around and wanted a ‘conversation’?

Never, right?

Yet the term is used often as we indulge ourselves in developing marketing collateral.

Frequency of purchase, read loyalty, can be the result of many things, awareness, market share, delivering better distribution, price, shelf position in a supermarket, big advertising budgets, and so on.

Only when you significantly increase the price, and some customers stick like glue, or  go from retailer A to retailer B for the single reason of being able to buy your product, do you have real loyalty. Even then, it is likely that rare, wonderful customer could not be bothered having a conversation with your brand, at the risk of the men in white coats carrying them off.

Even the exceptional brands, Apple is one, IBM used to be another, a deli in Flemington, Sydney, is another, known to a relative few who simply would  not go anywhere else, do not have conversations. 

Nobody in their right mind tries to have conversations with these brands.

They do have conversations with employees of the companies that own them, as they seek information, pricing, availability of spares, after sales service, and all the rest of the things we need, but nobody has a conversation with the brand.

Except in the mind of marketing dreamers.

They have conversations with people, your employees, their friends, and friends of their friends, people they meet in supermarkets and service facilities, the list goes on.

The real key is to ensure that when your brand is spoken about, in whatever context, people are telling others of the value delivered, the problems solved, and that it ‘delivers’.

Forget the frills, jargon, and self delusion, it is a tough world out there, and your product needs to perform as promised, then people will talk about you.

Header cartoon credit: Tom Gauld New Scientist.

The four crucial cornerstones of a successful marketing plan

The four crucial cornerstones of a successful marketing plan

Feb 4, 2019 | Branding, Marketing

 

It is February, budget time again, that time of the year when planning comes to the fore, usually as an added job that is just a pain in the rear.

A common question at this time, facing this challenge, is ‘How do I write a marketing plan’?.

I am not going to tell you ‘how’ to do it, as it will change every time, instead, I am going to give you some signposts, cornerstones, parameters, that I have seen over my 40 years of experience.

There is an easy way, and a hard way.

The easy way is to download a template and get the intern to spend a day filling in the gaps. About as useful as an umbrella in a cyclone.

Better than nothing, but only just.

Then there is the hard way, because it takes time, and requires you to use your brain, and the collective brains of others, and can be an emotional as much as analytical exercise, requiring time, energy, critical thinking, and collaboration, and making really challenging choices.

Let’s define what we mean by marketing, useful if you are going to plan for it.

My definition of marketing is the ‘generation, development, leveraging and protection of competitive advantage’.

Not a definition you will find in any textbook, but mine, evolved over 40 years of practical marketing. None of the others are wrong, they just, to my mind, do not reflect the whole task.

Competitive advantage evolves, and comes in many forms, but without it, you are in a commodity, price driven market, and you cannot win in that. The pace of evolution is these days frenetic, so writing a plan, and leaving to an occasional reference before the next budget session is useless, it has to be an evolving document.

If you can find a template that helps you do that, let me know.

Marketing is about the future, you are trying to shape it, so you are dealing with unknowns that can be sometimes qualified…. not quantified, by the use of mental models, cause and effect, domain knowledge, customer intimacy, competitive understanding, tactical agility, and a whole range of other things.

It is a jigsaw puzzle, to which you do not have the picture, and many of the pieces you do have are wrong, and many are missing, so you have to experiment, make up your own, use someone else’s cast-offs, try making your own pieces to fit.

At the end it is about making choices with imperfect information.

That is hard.

When faced with a choice that appears to be between two sub optimal outcomes, step back, and find another way. That is in itself a valid choice, and often a very good one, as it makes you think.

The greatest two problems most corporates have in planning marketing are extrapolation and confirmation bias. Add 3% to last year, and only seeing what they want to see.

That is what you get when you use a downloaded template in place of using your brain to critically assess options, information resources and market and trend sensitive antennae.

To develop a successful marketing plan, you need to find the 18th horse!

A contract drover west of Bourke, with 17 horses, his only asset, dies, and leaves them to his sons.

1/2 to the eldest, who wants to carry on the family business,

1/3 to the second, who is a great son, but has other ambitions,

1/9 to the third son, whose life revolves around the Royal Hotel in Bourke.

Think about it: None of these goes into 17.

The lawyer at the will reading sees the problem, and lends them one of his horses. Now they have 18.

9, and 6 and 2 to each son.

9 + 6 + 2 = 17, so the lawyer takes back his horse, and everyone is happy.

Your task planning marketing is to find the 18th horse

Successful Marketing is like having a great hand of cards.

Each card has a value by itself, but in isolation, that is very limited, the value of a hand is in the combination of cards you have, and in particular the combination you have compared to the combination your opponent, and how you leverage that combination. Sometimes as in bridge, the combination of your hand with that of your partner is crucial.

 

Context of a marketing plan

Every business will be different, the point is that a marketing plan does not, ever, evolve in isolation, it is a part of the overall strategy, and must be aligned with all the other functional responsibilities to deliver on the strategic priorities

The marketing component will also look different in each case. It may be product based, geography, market segment, and many others. These choices should be driven by strategy!

Trying to build a worthwhile marketing plan without clear, unambiguous and understood strategy with the appropriate strategic foundation in place is destined to be nothing more than a useless file stored somewhere, for no particular reason.

 

Cornerstones of a marketing plan

Some of the specifics within the perimeters of a marketing plan are always determined by the strategic choices that should have been made.

However, the cornerstones will generically remain the same:

Your Objective, Current position, Customer Value Proposition, and your Ideal customer.

Once you have these four, the rest of the plan becomes easier, to some extent, a matter of mechanics, trial and error, choices between the options that will best deliver the outcome.

Each is mutually reinforcing, making a mistake with one, either in the formulation or execution of the marketing plan will have implications beyond the immediate.

However, overriding the mechanics, you need leadership, the whole process requires leadership, as difficult choices will always be necessary.

In the absence of genuine marketing leadership, just go back to the template, and save yourself a lot of time and effort.

You will find at the intersection of the four perimeters is a little pot of gold!!

Very hard to find, very valuable when you do.

 

Current situation: the marketing audit

You have to have a starting point, and it is worth remembering at all times that you are not the only one in the race.

You have to have done some sort of marketing audit to determine the manner in which you can best deploy the limited resources available.

Who is currently buying your product, why, how, instead of what, are they happy with it, and what about those customers who have left you, why did they leave, what can you learn from the leaving, and so on.

In most cases, what others do will have some impact on you, some you can anticipate and accommodate, but you cannot control what others do, just your reaction to it.  However insufficient consideration of the impact of competitive activity is perhaps the most common mistake I see across all the marketing plans I have ever seen, and to be fair, those I wrote going back 30 or 40 years.

A long time ago I was with Cerebos, one of the brands I managed was Cerola muesli, at that time a successful brand, and I was keen to expand the brand footprint. I saw a gap in the market between muesli and corn flakes, this was 35 years ago, and there was not the wide choice we have now. We developed a half way product we called ‘Cerola Light and Crunchy’  and launched a test market in Adelaide.

At first we did remarkably well. The logic we employed was well accepted, the retailer sell in easily achieved targets, and consumer off-take was strong after the initial burst of advertising.

Then in came Kellogg’s with a look-a-like product, ‘Just Right’, and their resources just blew us away, Light &Crunchy never had a chance in the face of the weight of the competitive reaction by Kellogg’s.

That is a lesson I did not forget. With the benefit of hindsight, it was obvious, poke a bear in the arse and he is going to turn around and give you a whack, and I did not anticipate the power of it, and I should have. Never made that mistake again.

 

What success looks like

Unless you know where you are going, how can you plan to get there?

Are you setting out to build a brand, expand product range, geography, actively evolve your business model, whatever it is, unless it is articulated, you have no hope of making the right choices along the way, that build cumulatively to the planned outcome.

The strategic choices that need to be made to deliver the outcomes will be different depending on the desired outcome.

Describing what success looks like as if you were already there is a way more powerful way of articulating an objective that just extrapolating it from your current position. 

By putting yourself in the position of describing what it looks like, you generate an emotional commitment to achieving it much greater that if you had just extrapolated.

I am going to get myself in trouble here by shooting a sacred marketing cow.

Building a brand, or ‘branding’ used as a verb is bullshit.

‘Build my brand’ is a response I hear a lot when I ask the question ‘what is your objective, what does success look like?  

It usually is associated with a significant advertising expenditure. More often than not these days it is also tied to a digital platform. ‘I am going to build my brand on Instagram’  and some general babbling about ‘content’.  

I hate them both equally. If I walk past a lump of dogshit on the pavement, it is a lump of dogshit. If I take a photo of it and upload it to the web, it suddenly, miraculously becomes content.  To my mind it remains a photo of a pile of dogshit.

Using ‘Branding’ as a verb is a fallacy foisted on businesses by those who do not understand the process.  

Building a brand is not like building a wall, where you just put one brick on top of another.

Building a brand is a little like building a church.

A church is just a building until it becomes a place for people to come for reassurance, solace, and to encounter the rituals that make us human, then they might come back, they might bring their friends. You do not need a building for that!

The brand is the outcome, not the building. 

 

Tomb of the unknown customer

More money is thrown at the tomb of the unknown customer than any other source of marketing waste.

Unless you can define very well indeed who your customer is, you will be wasting most of any time, effort, and money you spend.

Defining who your ideal customer is involves choices, as you also  have to determine who is not, and therefore you will not spend resources trying to reach and influence them. This is really difficult for most, especially smaller businesses, to whom turning away a potential customer is an appalling thought.

Over 35 years ago I took over as Marketing Manager of the newly formed General Products Division of Dairy farmers.

The brand of yoghurt we had was Ski, and Yoplait had just launched, and the market exploded. Ski’s volumes remained about the same, but share was reduced to single figures as Yoplait had taken all the growth for itself.

During a qualitative research project aimed at understanding who was buying yoghurt, which brands they preferred and why, the researcher asked the respondents to describe each of the major brands in human terms.

Yoplait was an educated, hip, self-reliant, confident young woman, who had her life in order the way she wanted it.

Ski was a reliable 50 year old farmer in wellies.

The advertising plan that was in place when I arrived was just more of the same old stuff, trying to convince ‘Miss Yoplait’ that the wellie wearing farmer was a good choice for her.

Might not have worked very well, so it was changed.

 

Customer value proposition

Peter Drucker said many things, amongst which was ‘The only purpose of an enterprise is to create a customer’

And he was right.

To create a customer you must offer them value they cannot get anywhere else.

How you define value is a key part of the game here, and once everyone else is offering the same set of things, the only discriminator becomes price, and then everyone loses.

The value you add has to be differentiated, and differentiated in a way that adds value to the customer.

The ideal differentiator is one that stimulates a customer to buy something they can only get from you.

Differentiation also allows you to innovate where you will get the most value for the investment. Innovate where you are differentiated!!

If I go back to  the Ski example, we focused on the fact that Ski had discrete pieces of fruit in it, rather than fruit mashed up into a homogeneous mix that was the offer of Yoplait. We knew Yoplait could not offer pieces of fruit, their processing would not allow it, and neither would the brand rules inherited from the French franchisor. Not everyone in our target market wanted fruit pieces, but those who did, came to us. While it was only 1 piece of the puzzle, Ski was the market leader in a hugely expanded market 4 years later.

The key question to ask yourself about your value proposition is: ‘How likely is it to convert a potential customer’?

Putting a number against this is challenging, but an extremely useful exercise.

 

A few final words

First: How do you measure it?

Anyone who knows me knows I am a bit of a measurement Nazi, who subscribes to the cliché that you get what you measure.

You don’t always, at least as an entirety, you don’t. Some things like ‘Leadership’ and ‘Culture’ are vital but very hard to measure except over time and in hindsight.

A marketing plan is a set of predictions about the future. The only thing you know for sure is that you will be wrong, question is by how much, and how much you can learn and adjust as you go to mitigate the errors and leverage the unexpected.

Feedback loops are essential at every stage, for every activity, as implementation proceeds.

It is simply a Continuous Improvement cycle, and every CI tool that is used in factories is applicable to  marketing.

Ensure you are measuring each of the components of the plan that compound to deliver what you set out to achieve, but always remember that the marketing plan is a compass, not a roadmap to be followed in detail at all times in defiance of new and localised information.

If your marketing objective was to extend your geographic footprint, then  that is the right measure. secondary measures may be margin and customer acquisition costs, but if they become the primary ones, you will not extend your footprint because it takes investment.

Second: Marketing Investment.

Let me give a hobby horse a run………..

Marketing is an investment in telling the future, but is treated in the books as an expense, incurred in a period, reflected in the P&L.

Therefore short term thinking absolutely dominates the manner in which marketing is considered in the corner office.

This is the single greatest institutional barrier to sensible marketing, after finding people in marketing who know what they are talking about, and can do so without the jargon and cliché so beloved because they cover their basic ignorance, or perhaps  the ignorance of the basics.

Third: Success is a Pareto distribution, not a normal curve.

I noted that Drucker observed that the sole job of an enterprise was to create a customer, and he was right.

Therefore, marketing is essential.

Commercial success does not come in the normal curve we are all familiar with, where most of the outcomes are within 1 standard deviation from the mean.

Great success comes to a very few, moderate success to a few more, and most enterprises are distributed across a ‘long tail’. It is a Pareto distribution, where 5% of firms take 95% of the outcomes.

Therefore, if you are to be in the 5%, you had better get your marketing in order, and to do that, you need the four cornerstones in place.  

This is a link to a verbal version of this post delivered to a group of SME owners.

The reconciliation of advertising and content.

The reconciliation of advertising and content.

Dec 21, 2018 | Branding, Marketing, Uncategorized

 

Self appointed digital marketing experts have for years been telling us that ‘Content is King’, and for a while it was. As a result, marketers have flung millions upon millions on the altar of ‘creating content’.

Piles of crap produced en masse with the odd gem well hidden, aiming at leveraging the reach of the web and social platforms, to deliver messages to consumers in a manner that demanded more attention than the ad breaks on TV, without the cost.

Google and Facebook developed a virtual duopoly, and so the dream of cost free reach has been squeezed out of existence.

To get reach you have to pay for it.

Isn’t this what we did when we paid for advertising?

Why pay for content aimed at ‘engaging,’ or some other cliché, if you are going to pay to have it delivered? You may as well make it an ad, that has as its objective generating a sale.

As Facebook and Google, and the other platforms as they evolve continue to squeeze organic reach, Content will morph back to something more like the advertising used in the 20th century to build the huge brands we all still buy.

Call it what it is, don’t be precious, it is Advertising!

Cartoon credit: Tom Fishburne of Marketoonist, who continues to express in simple drawings the complexity and hubris of modern marketing. I hope you have a great Christmas Tom.

As for me, I am taking a short break from my (unpaid) adverting disguised as content on this blog, to see if I can catch the elusive bloke in the red suit.  Thank you all for reading, sharing and often commenting on my  brainfarts, it is a privilege and pleasure to be able to communicate in this way.  Have a safe and merry Christmas and i will ‘see” you all in 2019.

 

 

 

 

 

What marketers can learn at church

What marketers can learn at church

Dec 19, 2018 | Branding, Marketing

Every religion, from the worlds great ones to the meanest cult with a few deluded followers has something in common.

They communicate their message, engage their followers, with stories.

In most cases they are setting out to explain the mysteries of the human condition, to get at the essential truths that underlay behaviour, to explain the complexity in a simple and memorable manner, that makes recall and retelling easy and consistent.

The story of Adam and Eve is set in a perfect garden, with a snake representing evil, and an apple representing the pressures of the human condition.

Try explaining that without a story.

Every story in the Christian bible, from Cain and Abel to Jesus walking on water and making a crippled man walk contains a message. It is the same in the Koran, Hindu Bhagavad Gita and Buddhist Tripitakas.

With effective storytelling, they have all succeeded at the marketers dream.

Brand differentiation, and effective segmentation within the brands

Longevity

Strong loyalty and commitment that is multi-generational

Sustained commercial success

It may be a touch insensitive to make these observations as we are about to go into Christmas, but think of all the stories around Santa, and traditions that have built up over generations about what you eat, how you behave, and who you commune with.

All communicated by stories that support the central proposition, and even if you do not believe it, the behaviour still prevails. 

You have to give it to the clergy, of every brand,  they have this marketing gig nailed!