Great Marketers In 2022 – Build Their Brand With their People – Not Gurus.

Few subjects are discussed more and misunderstood more that ‘brand’ and ‘branding.’?These terms can of course, mean different things to different people. Additional terms for consideration are?– ‘actual brand’ and ‘optimum brand.’ For the purposes of this discussion, I will define these terms as follows:

• Brand – what your target market says about you when you are not present.
• Actual brand – what your target market is?currently?saying and you or your business.
• Optimum brand – what you target market?should be?saying to ensure optimum outcomes.
• Branding – reducing the gap between the actual and optimum brand.

Jeff Bezos?defined brand as – what?people?say about you, your product, or your business, when you are ‘not in the room’. What matters most of course, is what your target market or audiences is actually saying (what your target market actually thinks and feels), about you, your product or business. An organisation’s ‘actual brand’ is ultimately central to:

• Conversion rates.
• The average sale per customer.
• Margins (by maximising the perception of value).
• Repeat business rates.
• Referral rates.

The actual brand also influences:

• Enquiry rates.
• Staff recruitment and retention rates.
• The return from each staff member.
• The support of other stakeholders.
• Community support.

The optimum brand, on the other hand, is the one that will deliver the optimum outcomes for these criteria. The optimum brand is the one that accurately reflects the needs, wants and expectations of the target market and how these might be exceeded.

Branding is the process of changing the perceptions of your brand within your target market – to the point where the ‘actual brand’’ is the same as the ‘optimum brand’.

Effective branding involves:

• Defining the actual brand.
• Defining the optimum brand.
• Living the optimum brand.
• Communicating the optimum brand.

Simple exploratory research is required to define the actual brand – what the target audience currently thinks. More complex qualitative and quantitative research is required to understand the expectations of the target audiences and gather the data to develop the definition of the optimum brand.

Once the actual and optimum brands have been defined, the gap can be defined and the strategy for eliminating that gap can be implemented. Eliminating this gap involves – living the brand, or reflecting the brand in the:

• Design and quality of the product.
• Customer experience and service.

This in turn involves creating a culture that reflects the brand. Only once this culture has been developed, is it appropriate to begin communicating the brand, at least to external audiences. To demonstrate this, consider three examples.

APPLE – THE GOOD

Apple is either the most or second most valuable brand in the world. One recent valuation suggested the Apple brand is worth –?US$309 billion. The only brand likely to eclipse the value of Apple is the Amazon brand, which has been valued at US$300 billion. First second or third – the Apple brand attracts an extraordinary value. That value drives – conversion rates, the average sale per customer, margins, repeat business rates and referral rates.

This value, in part, explains its ranking as the world’s largest corporation and its ongoing record of record profitability.

This brand has not however been achieved through promotion. As a percentage of revenue, Apple spends 10% as much on advertising as Telstra. In relative terms, Apple is not a big advertiser. It is however a business that invests heavily in culture. It is the people who design and manufacture the products, together with those who sell and deliver the products that have brought the optimum Apple brand to life through its culture.

Consider these questions and the answers from consumers:

• Does it offer superior products? –?YES
• Does it offer superior locations? –?YES
• Does it offer superior pricing? –?Who cares – it is not about price.
• Does it offer superior service? –?YES
• Does it offer superior convenience? –?YES

Research demonstrates that the Apple brand is built on:

• Responsiveness – to a well-defined market
• Distinctiveness – especially in terms of innovation and design
• Culture – bringing the brand to life
• Consistency – in the delivery of the brand across channels
• Positioning – making it distinctive.

All of these characteristics are communicated by staff behaviour – the culture. You only need to visit an Apple store to appreciate this.

MYER – THE BAD

Myer was established in Bendigo in 1900 and was considered one of the great retail experiences in Australia. It was most certainly considered to be one of the great Australian retail brands. In 2020 Myer has 60 stores across Australia and is considered anything but an example of great retailing or a great brand. If anything, Myer is now viewed by many as a failing business with a very short life expectancy. Many, including me, have already written the epitaph of this once great brand. Mine will read – ‘hear lies a business that forgot what is important’.

Myer relisted on the Australian stock exchange with a price of?$4.10?in 2009 and has never traded above this price. By 27 July 2020 Myer was trading at?20c. While I am not a stock market pedant, I see no reason why Myer will ever trade above 50c again.

Many reasons have been offered for the spectacular demise of Myer including poor management, a changing market, increasing rents and poor economic conditions. It may well be that each of these factors has contributed to Myer’s fall from grace, but I would argue that no reason has contributed more than the culture of the business and the fact that no matter what Myer say in advertising, the staff rarely if ever deliver.

Consider the following questions and answers:

• Does Myer offer superior products?
• Does Myer offer superior locations?
• Does Myer offer superior pricing?
• Does Myer offer superior service?
• Does Myer offer superior convenience?

Myer promise the world in its advertising, but the culture is such that it delivers none of these things and lacks the culture to bring the brand to life. To understand the gap between the reality and the potential at Myer, one need only go in to a store and experience the dreadful service – or lack there -of. In such an environment, it is fair to ask:

• What does Myer stand for?
• What is the Myer point of difference?
• Why shop at Myer?
• Does Myer have a cogent brand?

ZAPPOS – THE BRILLIANT

In 2009 Amazon purchased Zappos for?US$1.2 billion. Ten years earlier, Zappos had sales of just US$1.6 million. By any measure, this valuation suggests that the previous ten years had been stunningly successful for Zappos. What is more, that success has been sustained since 2009. In 2020, Zappos is the world’s largest shoe store (albeit – online). Global sales in 2019 were US$568 million.

Behind the growth of Zappos has been Tony Hsieh. On many occasions, Tony has been asked to explain the success of Zappos. Here are some of his suggestions:

• “At Zappos, we really view culture as our No. 1 priority. We decided that if we get the culture right, most of the stuff, like building a brand around delivering the very best customer service, will just take care of itself.” -January 9th, 2010, The New York Times

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• “I made a list of the happiest periods in my life, and I realized that none of them involved money. I realized that building stuff and being creative and inventive made me happy. Connecting with a friend and talking through the entire night until the sun rose made me happy. Trick-or-treating in middle school with a group of my closest friends made me happy.?Pickles made me happy.”–from his book,?Delivering Happiness: A Path to Profits, Passion and Profits

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• “We’re willing to give up short-term profits or revenue growth to make sure we have the best culture. In fact, after orientation, we offer people $2,000 not to work at Zappos. The ones who stay are right for our culture.”–January 7th, 2010,?Forbes

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• “We believe that it’s really important to come up with core values that you can commit to. And by commit, we mean that you’re willing to hire and fire based on them. If you’re willing to do that, then you’re well on your way to building a company culture that is in line with the brand you want to build.”—November 15, 2010, The Huffington Post

Consider:

• Does Zappos offer superior products?
• Does Zappos offer superior locations??Not relevant.
• Does Zappos offer superior pricing??Who cares – it is not about price?
• Does Zappos offer superior service??Absolutely – second to none.
• Does Zappos offer superior convenience?

Also ask yourself this:

• Was this offering created with advertising? –?No.
• Was this offering created with culture? –

The quotes from Tony Hsieh clearly points to the importance of culture in developing a great business and a great brand. Hsieh, who has alas since died, build a great brand and business by creating a culture able to ensure that staff live the brand.

Of course, Hsieh is not alone in his comments about the importance of culture.

• “I think as a company, if you can get those two things right — having a clear direction on what you are trying to do and bringing in great people who can execute on the stuff — then you can do pretty well.” Mark Zuckerberg, CEO, Facebook

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• “Determine what behaviours and beliefs you value as a company and have everyone live true to them. These behaviours and beliefs should be so essential to your core, that you don’t even think of it as culture.” Brittany Forsyth, VP of Human Relations, Shopify

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• “I used to believe that culture was ‘soft’ and had little bearing on our bottom line. What I believe today is that our culture has everything to do with our bottom line, now and into the future.” Vern Dosch, author, Wired Differently

Three critical issues in creating the brand that creates the culture are:

• Selecting the right staff.
• Engaging all staff.
• Retaining the right staff.

SELECTING THE RIGHT STAFF

For most employees, income is a major consideration. That said, the vast majority are looking for more than that. Research suggests that?80%?of potential employees are influenced by the brand of the business they are considering working for. At the same time, employers are looking for staff who will engage with the organisation?and?its brand. Research shows that such engagement can deliver a 21% increase in profit.

In his book ‘Good to Great’ Jim Collins highlights the importance of employing only the ‘right’ staff – not the best available – but the ‘right’ staff – those ideally suited for the job in question. Further to this, Collins suggests that if a business cannot find the ‘right’ person – they should not employ anyone at all. He highlights the high cost of employing less than optimal staff. The ‘right’ people will be attracted to the brand and will make an ongoing contribution to bringing that brand to life.

It is people, and not promotion that brings a brand to life. This is evident to just about anyone walking into a Myer store and experiencing the lack of service or customer experience compared with those walking into an Apple store and experiencing the high standard of service and market appropriate customer experience. It is not possible to create the ‘optimal’ brand without the ‘right’ staff and attracting the ‘right staff’ requires an ‘optimal’ brand. Brands attract staff and staff create brands.

ENGAGE ALL STAFF

If you are to bring your brand to life, you first need to recognise that it is your staff who will do this job. The last blog in this series addressed employing the ‘right’ staff – staff who can bring your brand to life. This blog addresses the importance of engaging the ‘right’ staff, retaining them, and getting the best out of them. Research suggests that?71%?of executives believe employee engagement is critical to research and has a role in:

• Increasing productivity
• Improving morale
• Reducing absenteeism
• Delivering better customer service

Engaged staff also bring the brand to life – understanding and embracing the behaviours that are consistent with the brand, and never exhibiting behaviours that are not consistent with the brand. Only engaged staff will create your brand by bringing your brand definition to life. Engaging staff can be facilitated by:

• Ensuring they understand the vision and the expectations it creates
• Ensuring they understand the core values and the expectations they create
• Ensuring they understand the brand personality and the expectations they create
• Providing the education and training required to ensure staff have the requisite skills
• Provide the incentives required to ensure consistent behaviour of all staff

To live your brand, staff must first:

• Understand the brand and its implications for their behaviour
• Have the skills to consistently exhibit optimal behaviour
• Be incentivised and provided with feedback

RETAIN THE RIGHT STAFF

Great brands are built by the ‘right’ people (as suggested in previous blogs in this series), who are fully engaged with the business and its brand. Great brands are created by long term employees – the ‘right’ staff who are engaged with the brand to the extent that they choose to stay with the business for the long term.

The benefits of long-term staff are numerous and include:

• Reduced recruitment costs
• Lower training costs
• Retention of intellectual property

Long-term staff are also better placed to understand, embrace and live the brand – providing the customer service and customer experience promised by the brand. Retaining the best staff requires:

• Employing the right person in the first place
• Providing a clear and engaging vison and leadership
• Maximising the level of engagement with the brand
• Maintaining attractive remuneration packages
• Monitoring staff and providing feedback and training

Critical to retaining the right staff is a brand that reflects the values, personality, and capabilities of the staff member concerned – making the working environment one they feel proud of, rewarding and a pleasure to work in. Ideally, staff members need to feel pride in their employment, and nothing will inform this pride more than the organisation’s brand – ‘what people say about it when the owners of the brand are not in the room’. Vision, values, personality, and positioning are as important to staff as they are to purchasers.

GREAT MARKETERS…

• Great marketers in 2022 are defining an optimal brand based on the needs, expectations and needs of the target market.
• Great marketers in 2022 are defining their actual brand and the gap between it and the optimum brand.
• Great marketers in 2022 use culture as the primary strategy for eliminating the gap between the actual and optimum brand.
• Great marketers in 2022 work with people – HR and staff – to bring the brand to life and create a sustainable brand.

ANOTHER INSIGHT

• https://www.youtube.com/watch?v=P2fd9_LsNAk

ACTION

• Understand that your?actual brand?not your?optimum brand?determines outcomes.
• Define the businesses?optimum brand?and the gap between it and the actual brand.
• Create a culture – not a campaign – to bring your?optimum brand?to life.
• Bring your brand to life by eliminating the gap between the?actual?and?optimum brand.
• Create their brand by attracting, retaining, and getting the best out of the best people.

QUESTIONS

• What influences your purchase behaviour more – how the vendor sees his or her brand or how you see it? Is your market any different?
• What do you feel when your experience as a customer falls short of the expectation caused by advertising? Is your market any different?
• How do you feel when your expectations are exceeded? What is the probability of a repeat purchase or referral?
• How much cheaper might it be to create the culture that delivers the optimum brand, rather than relying on advertising?
• What has it cost you to not to have a culture that attracts, retains and gets the best out of the right staff?