Tired of competing on price and delivery? No company is too small -- and no product too generic -- to develop a brand identity
People accuse me of being a fanatic about wanting every small, growing company to develop a brand identity. And it's true; I am. That's because I went broke as a commodity company, a company that didn't try to distinguish itself from all the other companies in our market. I remember the three questions I used to be asked that gave me the chance to declare my generic intentions.
"What kind of business are you in?"
"We're in the training business."
"What kind of training do you do?"
"Who do you do it for?"
"Anybody who'll buy. How about you? I can be there in the morning."
Similar answers to those three questions will knock your company into generic oblivion. Since most buyers believe there's not much difference among top competitors' products, the method of bringing your product to your customers will be more important than the product you bring. If you ignore this phenomenon, the only way you can prosper in the commodity-market battle is through volume and economies of scale. You will forever labor in a marketplace dictated by price and delivery. Worse still, you will face on a daily basis the challenge of each and every new competitor who comes along. Not a fun place to be. And not a way to gain price points, margin, and profit in the 1990s.
For the '90s are going to be very different from the '80s. The opportunities will be greater than ever before. But they'll also be shared by fewer people. Company attitudes and plans will move from a short-term to a long-term focus. Businesses will be asking more of vendors. And vendors will no longer see selling as one transaction after another. Instead, there will be a shift to advisory relationships. We'll see more partnerships and joint ventures in a more difficult economic environment. The results will be complementary relationships between companies with different areas of expertise.
Your mission is to build yourself into this future. You'll have to be smarter about your markets, think long-term, and make commitments to vendors and customers. Those companies that serve best will offer specialized expertise to their customers.
Your end-user will have to believe that your product or service is different from and more valuable than the other products in your market. And your customers will have to be willing to pay more for it. That, in a nutshell, is where brand identity will lead.
A brand identity is broader than a brand name, which usually is a label given to a consumer product. Brand identity is what distinguishes one company -- and the support it gives its product or service -- from another. And keep in mind that brand identity is always measured in the eyes of the end-users. Not by us, but by them. Not what we send, but what they receive. Or, more accurately, their perception of what they receive.
Take a look at your own company. What do your customers receive? And don't tell me on-time delivery. That's a promise of the '80s. So is customer service. So is quality. Increasingly, they'll be the price of admission to the marketplace, not the characteristics that will allow you to stand out from the rest, to create and own your own niche.
Maybe you already have developed a successful brand identity for yourself. Here's an easy test to find out. You're succeeding if your customers
* understand what makes your product or service special;
* understand your product or service well enough to be able to describe it clearly;
* value your brand so much that they are willing to pay more for whatever it is that makes it special;
* feel so strongly about your brand that they will defend it -- even at a higher price -- when it comes under attack.
If you don't pass the test, you fall into that large, gray, amorphous, commodity-producing zone where I found myself. And who the hell wants to be known as generic?
Let's say you believe me and take this leap of faith, and then you come back and say: We've focused on our brand identity; we've figured out the best markets for us in the '90s; we know what that market likes. But they won't talk to us. We've got a selling problem. I say: No, you don't, you have a positioning problem. And that has a marketing solution. So let's look at that solution.
Positioning is a word that's thrown around the classrooms of business schools from coast to coast. But positioning is not what you do to a product or service -- which is what these business schools are saying. They say, Position your product or service. I say: No, positioning is what you do to the minds of the prospects. It's not how you wrap your product, it's how they receive your wrap. It's not how you package your service, it's how they perceive that service.
As consumers we like to believe we have an unlimited ability to retain purchase alternatives in our minds. But consumer marketers will tell you that's not true. Your recall -- that little store shelf in your mind -- of any product line is not more than three, four, or five brands, on average. And research says that you buy comfortably only from your shelf. And that shelf is, by definition, full.
So to reach those new high-value customers, you'll have to get on the shelves of their minds. There are only two ways to do that. The first is to reach up and pull an occupant off the shelf. That's an alternative I'll wager many of you have been trying. The second way is easier. You can create a new slot for yourself. You can build a little shelf all your own, a specialty shelf, next to the other one.
How are you going to create a new slot? Through brand identity. Trust me -- analyzing, formulating, marketing, and adapting your identity for the '90s will be the most significant event that will take place in your company.
Now, the good news is that creating brand identity is not complex, it's just foreign. The fact is, there are only three possibilities. All your brand alternatives, decisions, and strategies will be framed around one or more of these three. They are personal brand, product or service brand, and market brand. Let's walk through each so you can begin to think about the best fit for your company.
A personal brand focuses on the people who bring your product or service to market. There is a company in America, a marketing giant -- one of our most successful institutions ever -- that branded its people before it branded its product line. You remember the IBM look: the blue suit, white shirt, red tie, neatly coiffed hair, shined shoes. And IBM said this: Buying computers is a very intricate, perplexing, and sometimes scary decision. The public needs assistance in the decision-making process. So our people don't need to concentrate on our product, the actual computer. We need to provide the public with resources that can help them make and be comfortable with their final decision. Because IBM's people were so competent, so well trained, so well presented, and so well received, they became the IBM team, the IBM look, and the IBM brand. In effect, the brand was the trust and confidence in IBM employees' ability to help consumers make intelligent computer decisions.
How can a smaller, fast-growth company pursue personal branding? Datatec Industries -- a company that has done a good job with all three types of branding -- provides one example. Datatec, an installation company that does low-voltage electrical wiring to support computer point-of-sale equipment, found that its installation crews weren't particularly welcome on many sites. If the site was new construction, they were in the way. If it was an existing business, they were in the way.
The company itself is very much into customer satisfaction, and it asks customers to rate the crews after each project. We targeted one crew, checked its ratings, and six weeks later we put its members in uniforms -- shirts and hats with logos. Without any other change in personnel or procedures, their customer-satisfaction ratings increased. (Crew members may even have performed somewhat better because of their own pride in their personal brand.)
A product or service brand centers on the specialness of the particular product and/or service you bring to the market. Often, companies wrap a product in a special service so it will stand out from similar products. A highly visible example is Mary Kay Cosmetics.
Think about what it is that my wife buys from Mary Kay. If you say cosmetics, you're wrong. What she buys is the promise of beauty. How was that packaged? She was told that someone would come to her house to provide a facial and apply makeup, and at the end she would feel and look prettier than she'd ever felt and looked before. And that's exactly what happened.
At the conclusion of the process, she said, How can I feel and look this way again? They said, You need this bag of goop. And she bought that bag of cosmetics. And therein lies the profit vehicle again and again for Mary Kay. The brand is specific -- not cosmetics, but beauty.
Or how about Automatic Data Processing? It came into a data-processing world that was already filled with players. How could ADP's managers ever believe they could create a shelf-of-the-mind opportunity by going to big companies -- ones that were already doing business with companies like Electronic Data Systems -- and saying, We want to handle your data processing. No way to get on the shelf. No way to pull EDS off it.
They said, We'll do it differently. We'll have a specialty brand. Not all kinds of data processing, just payroll-data processing. Because we've learned it's an art form. So they said to customers, We've invested our money in creating the expertise necessary to understand that art form, package it, and bring it to you cost-effectively. Wouldn't it be in your best interest to at least take a look?
Shelf-space acquisition, my friends. Product and service brand.
A market brand creates brand identity through the special group of people you decide to sell to. Both Cadillac and Mercedes-Benz are examples of market branding. When you've become something in America, then you do business with them.
Generally speaking, for growing companies, market brand is the easiest of the brands, the most accessible and least disruptive. Look at your client list. Where are the markets of greatest opportunity? What do they need most, and could you possibly present yourself as bringing specialized expertise to that sector?
Or think of all the different emerging industry sectors out there. Which one could have an application for you? And could you describe what you offer in your promotional brochures, in your mailers? Not "We do all things for all people," but "We are specialists in this industry."
To support your market brand, research your end-user's industry: its growth, future, fears, and goals. And then carefully wrap your brand around whatever you discover. You don't talk about generic applications, you talk about specific applications, using the industry's parlance and perspectives.
It took me a while to learn that. I no longer say, What do you want? -- we'll be there in the morning. We still do training. But it's marketing and sales consulting and training. And it's not for everyone. Only for companies forced to market products and services identical to others in a competitive marketplace -- or products so similar that the end-users perceive them as identical.
Somewhere among these three potential brands -- personal, product or service, or market -- lies your brand future. The highest degree of branding effectiveness, I might add, takes place when you align specialized products or services with specialized markets. Take Hyatt Legal Services. It provides prepackaged, low-cost legal services specifically to middle-to low-income end-users who would otherwise be denied access to legal help. You wouldn't dream of going to Hyatt, and Hyatt's customers wouldn't dream of going to your lawyer. It's a specialized service to a specialized market.
You may be afraid that branding will limit your opportunities, that you'll back yourself into the wrong niche. If that's how you feel, don't be afraid to test-market your brand or multiple brand opportunities in specific, finite markets. In any case, before investing your precious capital in brochures and promotional pieces, make certain your brand-identity direction has been clearly established.
As you frame your brand identity, focus on opportunity markets rather than on market opportunities. Opportunity markets are those that have the capacity to be benevolent to your brand in the future in terms of strong growth, positioning, margin opportunity, and value-added pricing. (Take it from me, buyers like The Home Depot and Wal-Mart Stores will never pay value-added prices.) Look at the markets that are currently paying your rent, and determine what their future is. You may have to make strategic shifts to align with industries that are forecast to grow.
Along those lines, Wayne Gretzky may have said it best in a recent television interview. A reporter was asking him why he was the greatest hockey player alive. You're not the biggest, the reporter said, you're not the strongest, not the fastest, yet everybody says you're the greatest. Gretzky's reply was along these lines: "Well, you know, I'm a little surprised that you haven't picked it up already. Because to me it's quite obvious. When I get on the ice and play begins, everyone else on the ice goes where the puck is. Me? I go where the puck is going to be."
So my wish for you is that you use all your professional, personal, and emotional resources, and direct them so that throughout the '90s you and your company's brand identity find yourselves not where the puck is, but where the puck is going to be.
William R. 'Max' Carey Jr. is founder and chief executive of Corporate Resource Development Inc. (CRD), in Atlanta. In 1987 his company was #395 on the Inc. 500 list of the fastest-growing private companies in America. Two of his colleagues at CRD, Rebecca Holdren Ball and Sam Bowers, assisted him with this article.