An assault on the power of brands
(Image by Shadowplay)
I often get quite irritated when people say things like “since marginal costs, cost of innovation and barriers of entry to market are all getting close to zero the Brand is the only real asset a company has”. To a large extent that’s advertising agencies and marketers speaking, wanting to make their role so very important.
Those kind of statements are extremely ignorant to all other aspect of a business. I would argue that it would be difficult for most agencies to make a HTC phone more attractive than the iPhone. If it’s all about the brand that shouldn’t be a problem, even with a useless product.
The always changing economic landscape isn’t pushing everything to be about a brand, it’s pushing it to be all about the execution of business.
A common denominator for disruptive and innovating companies is that they’re value is not produced in the message but in their product development, focus and culture a.k.a. their DNA. And most importantly it’s people who build their brand in interacting with it, for every new customer, they get another evangelist that are spreading the greatness of their products.
It’s in the execution where most companies fail not because they don’t know what’s right but because it’s the hardest thing to do, execute on what you know. Often it’s impossible due to internal politics, personal pride and bad leadership. People are afraid of making mistakes or don’t have the authority to make difficult decisions. What advertisers try to do is package a product or service that often is fundamentally dysfunctional with a so-called brand.
Beautiful ads, great commercials and a fantastic message can’t cover up a poorly executed business in the long run.
Execution is likely to be in internal processes, culture and innovation. Two of the most admired companies in the world Apple and Google have made it to where they are because of those three things. The success they’ve had and their brand value is a result of those , not the other way around, that many advertising agencies seems to think.
I know that brands is an area people tend to love and most creative people are passionate about the power of brands. I’m not arguing against that brands have an effect but the brand has no power or possibility to cover up for a failing business.
For example Volvo (Volvo cars that is) has a great brand and has done quality communication for years, but they’re a dying company. I don’t care how great their brand is, they’re still not going to be around for much longer because of poor execution in core processes, primarily innovation and product development.
Product development and innovation is often spurred and fueled on the web, see for example Starbucks, Dell and Salesforce who all derive great value from the conversations they have through the internet, helping them evolve their products and services.
So please, don’t say a business is only it’s brand. That’s just the make-up, underneath you’ll sometimes find a corpse and sometimes a beautiful body.
Bloggar.se: google, apple, varumärke, reklam, annonsering, byråer
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