New Age Branding- of tectonic shifts and the spirit of humanity!

Indeed the New millennium is one that is breaking many established eternal truths that are now no more than mere myths. And who knows, perhaps this period may even qualify to be the period of Branding Renaissance! I believe we are blessed to be witnessing these tectonic shifts in our understanding of Branding and Consumers. I mean isn’t the sheer dynamism of the shifts absolutely amazing?!

We all know that Branding started more as a functional concept and gradually evolved to its Aspirational Avatar that most of us will recognize. A new study by the Havas media Labs throws up a very interesting statistic. It says that the consumers have become so indifferent and less attached to brands that if 80% of the brands were to go away they would not as much as notice.

Most of the marketers would hope that they are a part of the lucky 20%. In fact they would be fairly confident that they are indeed in the top twenty percentile that matters. Funnily, that reminds me of yet another very interesting statistic provided by Dr. Neil Bearden of INSEAD during one of his classes that I had the fortune of attending; 82% of the drivers think that they are in the top 30% safe drivers. At the cost of being accused for overkill, another one from NB; in a study, 86% of the Harvard Students felt that they were better looking than their classmates.

So what’s new now?! From the Aspirational we are moving to Meaningful brands. Dr. Philip Kotler in his recent book Marketing 3.0 talks about Value based marketing and the human spirit that Marketing 3.0 entails. Consumers are increasingly becoming caring about the Communities they live in, the societies they are a part of, the nature that provides them with the bounty. The hitherto clichéd terms such as the human spirit and societal good have attained a realistic dimension. This is perhaps due to increased sharing of everyday lives across communities, countries and continents through social media networks. Consumers tend to understand and empathize with each other. They have realized that mostly humans are same across the national and international divides. Even language has ceased to be a barrier, long live the Google translate feature!

Another interesting fact that comes out of the study conducted by Umair Haque of Havas Labs is the fact that the emerging markets like India, China and Brazil are different from the developed markets like the USA. Contrary to what you may think the study reveals that it’s these emerging markets where the spirit of humanity matters more. Interesting isn’t it? I’m sure that in the coming times USA and Europe should catch up with these emerging nations in their endeavor for the Human good ;)

So from the aspirational, “I’ve arrived!” statements to the more meaningful current avatar, “It matters to me because it matters to my community!” is a major tectonic shift. It will not be enough for Brands or Companies to not harm nature, society and community due to their operations, products or services. Rather the new age consumers expect the companies and Brands to make a positive impact to them if at all they wish to be a part of the top twenty percent of brands that matter.

It’s not as if companies or Brands have not realized this and many may argue that these concepts could be Old wine in a New Bottle. However, I would think these are different from the usual CSR routine dished out by the major corporations during the last few decades. The old CSR initiatives would be limited to a certain area where the companies would operate or would have influence in. However, my understanding of the new concepts is that they are much larger in perspective and influence. Consumers aspire for brands that positively impact and make a difference to the spirit of humanity. This would mean that a consumer in India is likely to make a choice of a brand that is perhaps working towards sustaining the Amazonian rain forests. Although the consumers’ immediate community is not benefited by the Brand or the Company, the fact that the Brand or the Company is working towards the betterment of humanity is a good enough reason to consider the brand a meaningful one. And all this travels faster than you can say Twitter! A point in the case is the latest faux pas by Kenneth Cole, strangely trying to draw mileage from the disturbances in Egypt by saying that the turmoil in Egypt was caused by the excitement generated by his Spring Summer Collection 2011launch. He was criticized across all the media, both traditional and new age. Positioning will acquire a new connotation post this careless and irresponsible tweet and Mr. Cole will have a tough time erasing this blot from his brand’s résumé and the consumer mind. And absolutely no prizes to guess who could be the latest addition to the 80% Club!


You would recall how Tommy Hilfiger was tainted by a malicious campaign across the Internet on his alleged remarks on the usage of his brand by people of Asian and African descent. It caused the corporation significant amount of money, effort and time to stop this baseless and vitriolic rumor. Such is the power of Web 2.0 that the rumor going on for almost two decades was fuelled so much by the web 2.0 that Tommy Hilfiger actually had to appear in the Oprah show and deny the false allegations along with placing the denial in the Company website FAQ section. Interestingly, even though the alleged comments were directed to specific sections, Tommy’s reputation suffered across the world. The following link is an interesting read in the case http://www.snopes.com/racial/business/hilfiger.asp .

So where in the Purchase decision journey does the new thought process fit into? I would think that definitely during the Initial Consideration List and the Active Evaluation phases. Thinking ahead, one could argue that the company’s stance with respect to the communities, societies, countries, environment and nature would definitely constitute to be post purchase experience and should have a significant bearing on the loyalty status- Active or Passive!

I guess the outcome of the above is at least two fold; the companies have to always keep the big picture in mind and brand positioning may be not only be in the minds of the consumers but also in their hearts!

Emotional Accounting!

To splurge or not to splurge, that is the question,

Whether 'tis nobler in the mind to spend

on fancy cars and a plasma;

Or to donate the cash to an Orphanage

And advance your Karma?!

Fortunately most of us have an answer to this. It depends upon where we got the money from. Strange isn’t it? But do think! Don’t you do that? What about your close friends and relatives? Bet they do the same.
It has been known for a while that Consumers have an ability to perform mental accounting in order to track their money. This is done by tagging the money according to its source. So if you won the money on a wager or whether you received a tax refund will determine how you tag the money. This also reflects in the way you spend it.
 The concept of Mental Accounting emerged in the 80s and was developed further into Income Accounting that determined the way the money was spend in a way that matched the source. Very recently Professors Jonathan Levav and Peter McGraw have propounded the concept of Emotional Accounting and they say that Money is categorized based on the feelings it evokes. This sounds very plausible to me when I think of myself as a consumer.
Levav and McGraw explain that consumers create “affective” tags for money as an emotional response. These affective tags then determine the coping up strategies in spending the money. For instance if someone were to receive money as a compensation for a wrongful death of a near and dear one, it is more than likely that the money will go for charity than for home improvement, unless of course you are plain evil like one of my ex-bosses. Even the scam artistes Indian politics produces by the dozen are known to donate to charities and temples in hope that the lord may not take notice of these teensy weensy improprieties. So the money can be Positive or Negative depending on the feelings it evokes! Post this, Levav builds on this theory on Mixed Emotions and the usage of this money becomes slightly more complex.
In the negative scenarios Consumers tend to adopt strategies on spending on virtuous things and activities and hence laundering the money. The positive scenarios lead to different spending patterns altogether. What is interesting is that in both scenarios the product purchased may be the same but its usage may vary.
It should be interesting to figure out a way to practically use the above information as Marketers? It should work wonders in high value personal selling. Combined with Professor Ram Charan’s Value Creation Selling concept it could be a potent weapon in any personal salesman’s arsenal. If the salesperson could deduce the spending motive and the attached affective tag from the consumer interaction, he would definitely hit pay dirt!

The New Active Consumer, Paradigm Shifts and their Impact on Success Strategies

As usual, there is a huge buzz around change especially given the context of the recent economic recession. Like always, this time around as well, most organizations are slow to react. The Managing boards are nearly always skeptical and perhaps rightly so and hence like to take it easy with change! Professor Nicholas Nassim Taleb, conclusively proves in his extraordinary work “The Black Swan”, that predictability is much better in retrospect!! And, like the cliché goes, Change is constant!!


Think of an answer the following question without straining yourselves! What was the front page solus advertisement in your favorite newspaper today?! If you can recall, be proud of yourselves, for, you are among that minority of the readers that save the advertisement industry their blushes.

And, delving a little deeper, Will you use the product? If yes, will you like it and become a loyal user? If you do become a loyal user, will you become a zealot read “Brand Endorser” who recommends the product? The more you keep answering in the affirmative, the more your tribe keeps getting exclusive. We could do this exercise for the other traditional mediums and end up with similar results. So while companies are spending their millions on traditional forms of advertising, the returns may not be something to write home about.

Does that mean traditional advertising as we knew it is over? Well, in isolation it is! But when you look at traditional advertising as a piece of the jigsaw to solve the consumer puzzle, it has utility that cannot be denied or defied!

Alright so with that piece of good news let’s scan the environment in which we operate and see if the paradigm has shifted any?!

Financial Paradigm: When Lehman Brothers (the company) breathed their last, it signaled a change that few of us can forget in our lifetimes. The recession that followed saw many huge and established players biting the dust. How effortlessly can corporations fall, was never demonstrated with such élan in the past. Also how Public money could be transferred shamelessly into the private domain and how the bonuses grew while the businesses perished was also exhibited by the key stakeholders of these big MNCs.

Information Paradigm: Information has undergone transformation. New planets have taken over the cyberspace.3G, SNS, Blogs, DTH, Web 2.0, Intranets. Business at the speed of thought could well be a reality sooner than later.

Knowledge Paradigm: Apart from the information transformation, new research and research methods backed by super software and powerful computing have boomed the Knowledge arena. Just to prove the point, think Neuromarketing, Pheromones, Effect of Colors, Mirroring, Blink, Tipping point and the Black Swans. And all of this is almost post 2000!

Consumer Paradigm: The consumer has changed. Latest research from Mc Kinsey which covers Japan, Germany and US consumers across various categories shows that the Consumer decision journey has changed. All of us are aware of the funnel shaped linear consumer decision journey. The new research shows that the process is circular and is definitely not funnel shaped, meaning the brands under consideration do not necessarily narrow down. Instead at the second stage they may increase. This is because the present day consumers are active in seeking information rather than passive waiting for marketers to reach them. The research also points out two various kinds of brand loyalists, active and passive ones. The passive ones are open to buying other brands as well.

Impact on success strategies: A lot has changed contextually w.r.t Branding. Marketers have to address an empowered active consumer base in an increasingly competitive environment. Hence the fact that some practice has continued for the last few decades, does not justify its continuation any more. Smart Brands will differentiate based on consumer experiences.

Smart branding will be based on more on functionality and relevance. Organizations that can build a direct line of sight to the consumers for all employees will continue to be successful. Brands that will learn to be strategically tactical will move north-east with time. Smart organizations shall fight their battles in the back drop of strategic snapshots in various geographies, segments etc.

Companies will have to build and execute relevant experience for the Consumers at the various touch points (Company Driven Marketing, Consumer Driven Marketing, Point of Purchase, and Post Purchase Experience)

And no matter what and in which age; Consumer Value will always drive share holder value!