RadiantBrands: Clunker Brand Insights; The Value of Brand Architecture

October 2009 E-NEWS
from Steven Donaldson and Michael Zinke, the Brand Guys

Shaping customer experience in a multi-channel world — creative, print, web, new media Radiant sends these brand insights to help you build value, uniqueness and loyalty for your brand. In business, your brand's critical differentiation helps your customers find you, remember you and come back to you.

In this issue:

After Cash for Clunkers: What car brands are valued most by customers? Now that the dust has settled from the Cash for Clunkers Program, the results can show us how consumers see the value …
The Right Brand Architecture: 9 strategies to convey your brand value and build key touch points. Defining the strategy behind your brand architecture will help you keep the most identifiable aspects of a brand in front of customers …

After Cash for Clunkers

Which Car Brands are Valued Most by Customers?

Now that the dust has settled from the Cash for Clunkers Program, the results can show us how consumers see the value of particular auto industry brands. There's no question that the incentives provided by the Federal Government to consumers to turn in their old oil-burning, gas-guzzling cars have encouraged purchases of new, fuel-efficient cars. Overall sales jumped between June and August, but this doesn't mean that consumers are ignorant of brand value — it did not mean that consumers flocked en masse only to American brands that have suffered so much in the recent collapse of auto sales.

Brands That Continue to Win

Over all, the leading world auto brand prior to this program was Toyota, and they enjoyed 18.9% of the sales from the Clunkers program, followed by GM at 17.6%. Ultimately this program reinforced existing trends in brand preferences. If anything, it highlighted the companies and brands that consumers like the most. For example, the Toyota Corolla was the most popular car purchased under the program, according to the NHTSA, followed by the Honda Civic and Ford Focus compact cars and the Toyota Camry mid-sized car.

This information shows that one American car company brand has come out less tarnished than all others: Ford. It's the only American car company to actually gain market share in the U.S. They are also the only American car company that did not take any Federal bailout dollars. Even before the rebate program Ford sales did not go down as much as GM's or Chrysler's. With the Clunkers program they have now become the one dominant player in the U.S. auto market.

When consumers were surveyed recently, they indicated that Ford, overall, was a more stable and reliable brand, while GM was badly damaged by its bankruptcy filing — so much so that they dropped the "GM" mark on their Chevrolet and other brands since it was more "tarnished" that the sub brands!

Why American Car Companies Could Not Change the Dynamics of Choice

Consumers (you're one) still hold the same perceived values of the brands they love. Stimulus, incentives, and discount sales only channel behavior for short-term gain. That's why discounts that are continuous eventually sabotage the brand because it says to consumers — we are only known for low prices — not value. Once locked into this position it's difficult to recover.

Why it's Valuable to Cultivate Consistent Brand Message —
and Deliver

Brands that keep predictability and quality as their key focus actually build more brand value to consumers during lean times because they are seen as reliable — they stand out in the morass of collapsing competitors willing to do anything to survive.

Consumer perceptions always rule and they do not change overnight. If anything, Cash for Clunkers gave consumers the choice to go for the brands they really valued at a lower price.

The Right Brand Architecture

9 Strategies to Convey Your Brand Value and Build Key Touch Points

Defining the strategy behind your brand architecture will help you keep the most identifiable aspects of a brand in front of customers. Whether you have a b2b product company or a consumer-based brand, how your brand is defined and the key touch points that reach customers consistently will leverage the value of your brand and build sales and market share.

Define your core brand — what's your story?

How you position your brand really starts at the interface with the consumer. This where consumers are trying to figure out how you fit into their experience. Think about it. You know in an instant what the difference is between a Whole Foods Market and a Safeway. Both these companies have created a clear picture in your mind through consistent advertising and store experience.

Keep your brand definition simple. Use these four key questions to define what your brand is about: 1) What's your brand promise — what do you offer your customers that they care about? 2) What's your unique value (in your market)? 3) What are the key attributes of your brand? And, 4) How are you positioned relative to your competitors?

The answers to these questions give you the core of how you position your parent brand and sub-brands — it's the way customers know you and how you are different from competitors.

What kind of brand are you?

All brands are not the same. There are basically four different types of brands, Corporate Brands like GE, Heinz, and Cisco; a House of Brands, such as GM, General Mills, Clorox; Combined brands such as Ford Mustang, Apple iPod, Porsche Boxster and single brands such as Altoids, GEICO, MacAfee.

Brand product lines range from those that focus on diverse markets with diverse lines of products to those that feature one dominant brand, focusing on one solution or set of values. The key is to focus on the type of company and organization you are and what your business model is to build the brand and to structure the marketing approach appropriately. Remember, the more brands you have the more marketing you need to do to push your brands and to gain recognition. Simplicity almost always works best.

What three things does your core brand represent?

If someone asked you what the top three things are that represent your brand, could you describe them in a simple answer? Are you the newsiest technology? The best quality and value, a unique driving experience? How you define these top three points is how you want customers to remember you — it's your brand.

What your logo really says about your brand to your customer.

Simplicity and consistency is essential to your logo, colors and trade dress. These are the symbolic representations of who you are to customers, the visual reminder over and over again of the brand experience — that this is where I purchased this great meal, this great computer. Your visual identity aligns with your customers' experience.

Ideally there should be no more than two levels of hierarchy.

Whatever your brand is, the practice of building more and more sub-brands with individually named and branded categories does not work. Simplicity is where it's at. Connecting brands through a series of simple, clear relationships keeps customer experience connected. Apple's iPhone, iPod, and iMac all are simple connections between the brand and the experience. 3M is another good example of the power of consistently promoting the value of the parent brand with every sub-brand. On the other hand, the Clorox brand means virtually nothing in the Hidden Valley Ranch brand.

A tagline emphasizes your unique value to at all levels.

What often further connects meaning to a brand is the tagline. Sometimes the brand name may have no immediate meaning without the tagline for example Kids Organic - wholesome complete meals for kids or with FedEx — the world on time. In each case the taglines adds meaning and value to your experience as a consumer.

How company and product names reinforce each other.

When you build a strong corporate or parent brand and have several product or sub-brands, the connection needs to be simple, clear and reinforcing, such as Subaru Outback, Subaru Forester. The name "outback" or "forester" would mean nothing without that key connection. It creates the brand and customer connection. The essential goal of brands is to be simple, repeat and then repeat again and again.

Define key touchpoints to their experience.

Consumers exist in a world of experiences and your brand needs to identify where these experiences happen to reinforce your connection to the customer. Ad campaigns, online marketing, signage, packaging, blogs and the actual products themselves are all touch points that can reinforce your brand. The work of defining the brand is limited only by your budget and what's appropriate for the brand.

Keep on keepin' on. Repetition builds connection.

Lastly, simplicity and repetition are the keys to familiarity. By the time you are bored stiff from your messaging, consumers will just begin to catch on. The incredible repetition of the Got Milk? branding campaign reinforced customers' awareness so much that even today that brand message is known.