Nagesh P. Shinde

On average, U.S. corporations lose half of their customers every five years, half of their employees every four years, and half of their investors every year, according to Frederick Reichheld, author of The Loyalty Effect. That doesn't sound to me like a lot of loyalty. And I thought that branding was supposed to keep people coming back for more. Meanwhile, we champion entrepreneurs because we want them to establish new brands. In effect, venture capitalists are betting hundreds of millions of dollars every year that people will be disloyal and forgo the brands they're now using in favor of something new. Traditional marketing and branding strategies haven't helped most big corporations either. If you look at the top 50 of the Fortune 500 in 1989, you'll see that 10 years later, 39 had dropped from the Fortune 50. These are the companies that spend the most money advertising and promoting their brands.

So what is a brand supposed to do? Encourage customers to be loyal? Help a company build its position and long-term viability? The $300 billion or $400 billion spent on promotions annually during the past 20 years has not achieved much in terms of lasting corporate performance.

Take the branding of coffee in the United States 10 years ago. Today, we're all drinking Starbucks—not Folgers, not Maxwell House. Those might still be brands bought in grocery stores, but the brand most people identify with is the one that popped up on a corner in their neighborhood. And that brand didn't make its presence in our lives through promotion and advertising; it did so by actually building service centers in our communities.

Branding has become a religion in most corporations, and it's very hard to dislodge it, because people believe that the brand itself is something that changes consumer behavior. We tend to think that branding comes first and the company's success follows. In fact, when you look at most businesses, the products came first, they built their infrastructures, and their brands evolved along with the success of the products and services over many, many decades. Let's take Coca-Cola as an example. Every day around the world, 1 billion people buy a Coca-Cola product. Now, take away Coca-Cola's bottlers. Take away its distributors. Take away its retail centers. Take away its 130 years of experience dealing with the retail environment, and its constant attempt to create new products. And Coke's ads wouldn't work. The belief today is that you can create a Coke simply by running ads. And I say, no, you have to build that infrastructure, and that's not easy. It's expensive, and it takes a long time to develop so that it becomes a presence in people's lives.

The Internet has certainly changed the way in which you brand products, but not in the way most marketers think. The Internet is not a broadcast medium like television. It is much more of a service medium in which you allow people to interact and exchange information with you. And it's going to take another decade before we really learn how to use the Internet effectively. We have had more than 500 years to learn how to use print as an effective medium, and it took a long time for the radio and television to become effective.

Everything that companies are doing on the Web today is practice. People criticize the dotcoms, and so do we. But the fact is that they were social experiments. Intel was once in the watch business; Texas Instruments and National Semiconductor were in watches, toys and games. There's a lot of technology that we believe has applications, but then the marketplace experiments with it to see how you can deliver those applications or technologies in useful forms. And that isn't an instant conclusion. It often takes the experience of failure and time to learn and evolve.

© 2006 3rd Street marketing, Inc. All Rights Reserve.

Regis McKenna is right: branding is overrated, just as "positioning" and "marketing warfare." Markets rarely thrive on the basis of a single driver: a company needs its products, its distribution channels, its experience.

Too often today, branding is a trendy substitute for hard, sweaty work in engineering, production, pricing, warehousing, delivery, service. As a result, the "old economy" bricks-and-mortar companies may be the eventual winners after all. The Web will remain an information resource for the time being.

Our clients' customers still need polycrystalline diamond drill bits and hydrogen blistering inhibitors, even if they don't remember the brand names.

“I figured that if I said it enough, I would convince the world that I really was the greatest.” -- Muhammad Ali

I agree with one main point in this article, and that is that the products have to come first in branding. Also, like the article says, what are we trying to do in branding, create purchases and hype, or create loyalty? With that said a bad product with good branding might sell, but it will not create loyalty. On the other hand a good product with bad branding might never be bought at all. Which is worse?

I read and article called "Identity Driven Branding: Branding from the Inside Out" (http://www.allaboutbranding.com/index.lasso?article=428), and it made me think of some interesting things. When we talk about branding here, we make it seem like something companies create and give to consumers. However, like Dennis Hahn says in the article I read, it isn't just the brand we feed them that shapes the brand in the consumer's mind. I can never find the books I want at Barnes and Noble in Woodbury. I am just going to start going to Woodbury's Borders because this makes me think Barnes and Noble has a bad selection. In reality, the B&N in Woodbury is just small, so other stores may have an outstanding selection, but my views are based on my experience. As Hahn says "A brand, then, is the unique sum of impressions associated with a particular company, product or service. If the impressions are overwhelmingly good, if individuals desire a steady affiliation with the brand, the brand will endure and become an important - perhaps the most important - asset to a company."

So in order to create a brand, a company needs to think about the traditional things we as designers think about (name, logo, colors, etc.) the things advertisers think about (promotion, catchiness, differentiation), and then consider how customers will react to the lowest levels of the company. I have never met the CEO of Barnes and Noble, or its board of directors, or creative team or anything. They may have done everything right on their end, but since someone decided to build a small store in Woodbury, MN I have a negative view of their business. If a company really wants to impact the consumer and create a satisfying brand they need to think about how the consumer will react with the product in the end. This could make an impact on everything from hard to open packaging to making sure things are available to the personalities of salespeople and delivery people. The total picture may end up making or breaking a sale or loyalty.

I believe that branding is a very important part in product development, but is it the most important part? A product that is high in quality would be nothing if something about it’s branding wasn’t appealing enough to sway someone towards it. I think that that once discovered a quality product creates loyalty. Like mentioned in the article, the most successful products are those that have been around for many years, such as coca-cola, and I believe that the branding wasn't the reason people choose coca-cola 130 years ago. I feel this way because 130 years ago there wasn’t as many products to choose from, therefore making it relatively easy to get people to buy their products. The quality of the product would be most important in this case especially because the technology used today to build and maintain a brand did not exist. I am not saying that branding played no part in the success of coca-cola; I am saying that branding is more important today than ever because of the amount of products available as well as the technology available to produce good branding systems.

I also read a random blog on the topic of branding and found it relevant and interesting. It was at: http://www.weblog.ownarticles.com/branding/14134.html
It talked about certain products and methods used to sell them. One was a body wash that was different than all others on the market. It was described as smelling like mud and looked like nothing else. The company went with the “Natural approach” and it was a success. The blog also mentioned things about other products and what they use to get customers such as The Body Shop and their “Against animal testing” tagline.

Considering the above points, it will be interesting to see brands that have just developed over the past 15 years begin to grab their piece of the pie.

I think the previous comments speak particulary to Geek Squad and Fire Dog. Geek Squad came onto the scene 12 years ago, in 1994. In 1997, three years later, they developed the famous Special Agents that have made them so appealling to their customers. In 2002, they partnered with Best Buy. Now every outlet wants a Geek Squad. And, they seem to be going wrong by creating a branding that cannot compare to Geek Squad. For instance, Fire Dog, the newest competition, seems to be bidding for their part of the market. Although Fire Dog has a strong technological connotation (Fire Lite and the browser Fire Fox) is doesn't seem they will have the same appeal as a Special Agent from Geek Squad who vows to protect you're computer from viruses. At this point Geek Squad's branding seems to play in their favor.

Maybe in a few years, Fire Dog will have an epiphany and come up with something as clever as Geek Squad's Special Agents, but that's difficult to imagine.

The ideas surrounding branding have provided the question of what is more important- the brand image, or the product. While in a perfect world I would agree that product must be important, but I don’t think we can always bank on that. There is a famous phrase ‘don’t judge a book by its cover’ yet we all do. I know I do. I see something, that judge what it is going to be like and if I want to invest time or money into it. Brand identity sets that tone with future costumes- it is the cover of the book, hopefully tempting people to open the book and investigate what’s inside.
Branding wants to create loyalty, yet as we have seen, it is failing. Maybe it is because people are bored. They have seen how many commercials, posters, magazine ads in their life, the need and want more. I came across an article that discussed just this- more creativity in branding. The title of the article is “A New Kind of Ad Game Scores with Consumers” (Adweek 47 no3 9 Jan 16 2006). This article discusses the company Reactrix (a technology firm in California) and their need to create a higher level of brand recall. They have explored the idea of interactive advertising. “The technology allows Reactrix to project 6-by-8-foot advertising images onto the floors of public spaces in 30-second increments. Consumers step on the images to interact with the ads. For example, an ad for Adidas featured a soccer field that players stand on to "kick" a virtual ball to each other.
” Another example of this type of advertising is when Reactrix created an ad for ‘Visa that featured its gift card during the holiday season. The ad encouraged passersby to "stomp out bad gifts" (including a fruitcake and garden gnome), which, once stomped out, revealed the gift card’
Overall I think this is a push in the correct direction for advertising. Breaking out of the norm to get people’s attention in a new way. It always the consumer to have more of a personal experience with the brand/company, thus hoping to encourage brand recall and brand loyalty.

Reactrix website: http://www.reactrix.com/ (shows more about this technology)

I would agree with the article where it talks about marketing coming second to a strong product. If your product’s marketing convinces someone to purchase your product and they discover it’s not really anything special they may search for something they find more inventive or personal to their expectations. Marketing can only take brand loyalty so far. You may trick the consumer once to buy your product but if they are not satisfied it will quickly be forgotten.

Having that something special to your product, something no one else has will keep people buying, that is until someone else comes out with something more inventive, more personalized. That’s were recreation of the brand comes into play. A recent example of recreation of a brand would be Herbal Essences move away from sensuality to sell their product to a product that is individualized for many different hair types, something for everyone.

I came across an article dealing with brand loyalty. http://www.underconsideration.com/speakup/archives/002361.html. In the article the author talks about losing his lawyer, accountant, and banker and these people’s respective companies expecting to keep the authors business. The author argues that he really enjoyed the personal contact that he felt with these people and had no loyalty to their companies or their services he was there for the people not what their brand provided.. He is seeking to find people that will recreate these types of business friendships he had created with his past lawyer etc. He moves on to talk about when brands change their lines of products and they hope that consumers will stay with them. He says he doesn’t feel the need to search for a new product inside of whatever is replacing what he previously bought. “If a fashion house gets a new designer, a restaurant gets a new chef, a store gets new staff. There may be nothing wrong with the change, but loss of familiarity, unless filled by something new and interesting is enough to make me turn elsewhere.”

One personal example of brand loyalty is The Best American Book series. Several years ago I was introduced to the Best American Short Series in a class and ever since them I have continued to purchase the new book every year, along with Best American Non-Required Reading series. Even though I have not read every book in the series I buy them like clockwork. Either I’m a very big impulse buyer or I know from past experience the quality of this series and their expectations of their product. Just recently I bought the newest addition in the series The Best American Comics knowing that it will be the best of the comics of the past year. Much work goes into putting these collections together and creating a diverse example of the best work of each year. Their attention to detail and pride of quality have captured my attention.

Branding is overrated, as the article says, it is not what gets people to stick with a brand; considering corporations lose half their customers every five years. Companies are spending money on advertising and promoting their brand rather than serving the customer. Like the article says the reason Coke is successful is not because of their ads but because of the infrastructure they have built with distributors, bottlers, retail centers, etc. They are providing a service and product rather than just flashy ads. I think it is more important to find and serve the customer’s needs rather than using flashy ads to get the customer to buy your product over someone else’s. For example, I do not go out and buy a product just because I like the ad, I buy a product because it will suit my needs or it is in my price range. There is definitely truth to brand loyalty; as stated in an article on About.com, “76 percent of Americans in all demographic groups consider a product’s brand before making a final product selection.” (http://retailindustry.about.com/library/bl/02q2/bl_gma061302.htm) These people however probably became loyal to that brand because they enjoy the product, not just because they find the brand name and advertising appealing.

However I read another article supporting branding that made a few good points. It was in Step Inside Design, June 2006 called: “ How can brands remain really good? And desirable?. The article talked about how consumers now are wanting products that are more “good” like fair trade, organic, recyclable, etc. and how brands need to be conscious of this and give the consumers what they want because brand success is firmly rooted in consumers desires; which is linked to the design. Brands are now embracing the trend of goodness with the materials they are using like carbon neutral policies or by giving proceeds as charity donations. The article also talked about how design is the key between brand and consumer and that packaging is the medium used to communicate the message and build the goodness and loyalty. Consumers are also expecting brands to have goodness in everything they say and do. Examples of brands that are successful at showing their goodness are Green & Black, Anheuser Busch’s Wild Hop, and Biota. Their designs are simple and promote the needs of their consumers; they cater to what consumers are looking for right now. Another idea the article discusses is that designers need to take responsibility in making sure what they are offering is not a gimmick. I think that consumers need a brand to be holistic and not lie in order for them to trust the company and become brand loyal. Consumers will switch brands as soon as there is a lie or if the brand is not meeting their needs. If corporations are going to stick with trying to get consumers to become brand loyal they need to keep in mind that consumers needs are going to keep changing so they need to cater to their needs and change with them in order to be successful.

I agree that the branding of a product isn't the most important part of a company. A company needs to have good quality products with consistency and innovation. Without these things the branding would not hold up. Consumers would go elsewhere to find these things.

I found a good article at <http://retailindustry.about.com/library/bl/02q2/bl_gma061302.htm> where those people took a survey and were found to be influenced by high quality, familiar brands and nostalgia.

Customers were more prompted to buy high quality items with a higher cost than an average quality at a lower price. They also bought more products that they had grown up using, and therefore the consistent satisfation was important, something they could rely on time and time again.

I found this to be very true, many of the grocery items I use now are ones my parents would buy and use. Old Home cottage cheese, Aquafresh toothpaste, Irish Spring soap, Tombstone pizza, the list goes on. I have been consistently satisfied with these products and therefore never wanted to change. I also tend to buy the higher quality, more costly items that will last, rather than the poor quality items that break sooner.

Maybe part of why we buy things is the brand name, but mostly it's what the brand represents, quality, consistency and nostalgia.

Branding is such a tricky subject because people have som many opinions on how it is effective, IF it is effective, and what works and what doesn't. What, in fact, does make people loyal? What makes people change their loyalty? I have a friend who, even though it's more expensive and doesn't work any better than anything else, always buys Tide. No matter what, she refuses to buy anything cheaper, or even of the same quality, than Tide detergent. Is it safety and trust that she feels while using Tide? I'm not really sure, but she seems to feel that way. It's like what you mentioned with Coke, maybe she has had years to build a relationship with Tide as a brand and haas memories associated with it. Who knows?

On a totally different topic, you mentioned that taking risks can be beneficial to struggling companies as far as trying new products and going in new branding directions with them. Intel and TI are good examples, but probably the best example I've ever found of a company taking a risk ona new endeavor in branding is that of a little known Japanese toy company who, in the early 1980's decided that they'd like to try to create a home console to be the next step in video game evolution. After a lot of struggling and a couple of false starts, this particular company created the Famicom, or Family Computer, and decided to try to break into the U.S. market with it. Despite failing sales of video games in the U.S. this company's console was an enormous success and revitalized America's love affair with gaming. All because they took a risk. That company's name is Nintendo, by the way, and the system's name was changed to the NES for this hemisphere.

I am currently working on a manifesto. The following section applies to this corporate branding dilemma. Enjoy!


The 20th Century offered the Western world the magic of science and technology that perpetuated many new innovations and concepts, which in turn, brought forth the need for new and challenging socio-political interventions. The century of change was an epoch of a knowledge explosion as well; ironically, the paradox of knowledge is the more one acquires, the more one realizes how much he or she really does not know. However, many in the past century have claimed to provide us with the secrets of life and suddenly, Darwinian, Freudian, and Marxist ideologies began to manifest themselves into aggressive theories and practices. However, these manifestations, and others like them, only offered us fragmented Rosetta Stones to understanding the human condition. In an era of economic and political upheaval caused by industrialization, vigorous nationalism, arms races, and empires, and then by two world wars, weapons of mass destruction, globalization, and decolonization, the world was left in shambles and masses in confusion; understandably than, more so than ever before in history, many social, political, economic, and artistic systems where conceived and exercised. However, clearly the world is far from being resolved with the declarations that have thus far been revealed to us.

Politically, we offer a Lennonian inspired alternative—a panhuman collective world, but with a centralist structure. We strive for a democratically elected quasi-Socialist parliament Global-State, with the objective of creating a world free from socio-economic stratification caused by the Capitalist machine of free markets and corporate greed. Moreover, it would be completely liberated from class, racial, gender, and sexual orientation inequality. The Liberal-Progressive highly eco-friendly government of complete secularism and pacifism, would exercise ethically based humanistic and rationale ideals of absolute security, liberty, and happiness for the masses without creating the fear of a Huxleian or Orwellian nightmare. Both presented us with a chilling utopian image of the future. Huxley prophesied a future where love—more so our desire for ephemeral pleasure—will destroy us, where as Orwell suggested our hate would ultimately destroy us. Our system would supply a global language and currency, but individual subcultures would be strongly encouraged and supported, because a monoculture is simply an odious thought. The system would be evaluated on the simple premise that a society is only as strong as its weakest member.



To read more of my manifesto please visit:

http://blog.myspace.com/index.cfm?fuseaction=blog.view&friendID=46542245&blogID=117729334&MyToken=ef0a8480-d57d-4474-b9d1-c6e8cc481a45

I think that when it comes to branding, the more you see something the more you are going to be influenced to buy it. When deciding what to buy in stores, people are definitely influnced by commercials and ads they have seen a lot, even if they don't realize it. There are so many brands out there that are all offering the same thing and deciding which one it the right one is the hardest part especially if it is a product that you haven't used before. Poeple are more likely to buy either the cheapest product or the one they are most familar with. Depending on what the product is, people are more likely to go with the more familiar over the cheapest.

Brands. Right. I dont know what to think about them anymore because we live in a society with so many outlets for communication, advertising, open ended word of mouth advertising. Brands such as Starbucks, McDonalds, and WalMart have a unique and generally rare place for branding because they appeal to a global market. If we look at more local and regional branding the brand itself might not have as much power or placement.

Online markets and branding are hard to pin down as well. The Googles, Yahoos, and ebays of our time have no 'real world' value because they are just a strong online image and name. Consumers now have a choice and product placement isn't as image heavy or 'Impulse' as it was before internet, easy research on product options, consumer reviews etc...until the early 90's consumers didnt have a choice, and only had to make judgements based on branding, product identification, and consumer trust in that brand.

In conclusion, we need to look at our markets much more thoroughly because it might not be the point of purchase where the consumer relates to the brand and identity of a product, but it might be months before in an online setting. The brand isn't overated, just evolved in its use and how we need to consider its importance and place in our markets.

People, in general, don't buy a product because the brand itself. Consumers are looking for something to fulfill a need or desire. Companies need to take into consideration what people need, but also release a product that is of quality to both fulfill the need and keep the customer coming back. The product itself is what draws the customer. The branding is mostly an afterthought only there for when the customer needs a reference of which soap suited their needs the best.

Good points have been made on both ends. Yes the customer remembers the brand, but only as a reference as I stated before. The product is what brings the consumer back. they are loyal to the product, not the brand. Also, some people buy the brand because it's what they have seen over and over, mostly in the cases of a first time buyer of a product. They don't really know which one works the best, so they pick the one they've seen the most often.

I think it goes back to the point that was brought up about what we grow up with. The choice is made for us which toothpaste we use, what soda we drink. Over the years becomes a comfort factor, we buy what we know, what we are comfortable with. Sometimes those do get old and we try something new. A lot of times, those choices are influeced by what they have heard from other people who have actually used the product and know the quality; word of mouth.

In the end, all branding does is give a reference, if anything.

I agree with many in that branding is secondary to product. The product and/or service is the foundation, I think, to making everything successful. Marketing 101-consumers are the basis for our economic system. Our money dictates what can or cannot be sold and along with that 50 cents of each dollar we spend is used in the marketing process, wherein branding lies. So if people aren't willing to buy a product or have bought the product and are not satisfied with it then branding is futile.
Good products and good branding should be able to transcend time, like the Coca-Colas, Pepsis, or Macintoshes. They must be able to stay creative, fresh, and innovative. For this to happen, it all goes back to the consumer. Businesses must stay in tune with those who are purchasing their items.

Branding may be over-rated, but as long as their are people that will buy it, it will continue to be a major part of consumerism. Branding is a part of our lifestyle as well as our economy. If every can of soda was white and said Cola or Rootbeer in a plain bold font across the can people wouldn't enjoy drinking it. Branding allows companies to express how their product works and also gives consumers the freedom of choice.

This article http://il.essortment.com/brandloyalty_pqk.htm goes into detail about branding as more than a symbol but as a means to create loyalty. Well designed symbols or logos can help make companies quickly identifiable. A good brand should not only be about the companies products and services but it should also focus on the companies philosophies. With this in mind companies can create more generalized, simple, easy to relate to brands.

Having loyalty for certain brand names is not as common as it was years ago. The elder generation might still stick with product because they are comfortable with it, but our generation thinks differently. We want fast, convience, modern and we want it now. It's a competitive market and most of us will trade up one brand for something that is newer and better. The loyalty with a brand will remain if the product continues to improve and evolve as time goes on. Fictionwise.com made a statement asking companies whether they build the brand today in order to move merchandise tomorrow, or expand the brand today in order to move the goods today and see it decline tomorrow?

I liked how the article mentioned that brands only maintain loyalty with their customers by continually evolving their product and its image. The article used the example of Coca cola even musicians go through different phases or appearance and style in order to stay fresh. Shouldn't branding do the same?