Ben Wise on Branding

Watching the world through the lens of the brand

Posts Tagged ‘Apple

Apple Is All Grown Up, No Longer the Underdog

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It has been hard to miss the news that Apple’s market cap surpassed Microsoft yesterday, making it the most valuable tech company in the US, and second overall, behind Exxon Mobil. Earlier this week, Apple also announced that they will be ending the much-loved ‘Get a Mac’ ads (check out their 10 best ads).

I thought it was perfect timing that both of these happened in the same week, as they both portray the reality that Apple is all grown up and can no longer play the role of underdog, which was so clearly portrayed in the ‘Get a Mac’ ads.

For years Apple has played the role of the underdog to perfection. Fighting against industry giants like Microsoft and Sony, Apple managed to maintain this ‘little guy’ market position despite their rapidly growing top and bottom lines.

Luckily for Apple, this change in position has been fairly gradual over the past couple of years as they increasingly occupy the market space around cool, entertainment, and ease of use. As their soaring market cap can attest to, these are obviously powerful attributes for a brand to be associated with.

However, Apple does face risks. While they were once the beloved scrappy underdog, they will now face competitors who can credibly play that role. Apple has already taken some bad press for the mysterious process of getting apps approved (or denied!), and may encounter further resistance as other app stores catch up and offer a credible alternative.

The biggest risk Apple faces, however, is inflated expectations, everywhere from Wall Street to Main Street. After a series of industry changing innovations (at least 6 by my count), consumers will be disappointed in any new product that isn’t a home run.

What do you think? Can Apple’s winning streak continue?

Written by benwisebranding

May 27, 2010 at 8:13 pm

Underdog Brands

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People are naturally attracted to the underdog. The story of the little guy that beat the odds gives everyone a warm and fuzzy feeling inside. In a brand context, this is no different. A brand that is well positioned as the underdog can use this as a powerful marketing tool to gain consumer loyalty.

Here are a few quick examples:

  • Pepsi is the underdog to Coke and used this to effectively capture the youth market
  • Adidas is the underdog to Nike and has grown their brand considerably in the past decade
  • Apple is the underdog to Microsoft/Nokia/HP (and more) and has become one of the most powerful brands on the planet

What do all of these brands have in common?

A key part of playing the underdog role is a sense of irreverence towards the bigger guys. Don’t try to copy what your competitors are doing, find an exciting, scrappy way to win then flaunt it as much as possible.

Second, if you look at the above list of underdogs, they are all seen as cool and rebellious. There is a social status aspect for consumers who buy and use these brands.

Finally, all of the underdog brands promote emotional benefits, not functional ones. This allows them to develop consumers that are much more loyal to their brand. People feel very strongly about supporting the underdog and are going to try to convince others to do so as well – even once the ‘little guy’ has become a behemoth, as with all of the above examples.

What do you think? What other brands play the role of the underdog?

Written by benwisebranding

April 20, 2010 at 11:22 pm

Getting the Most from Brand Extensions

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For the past few months I have been working with a client on evaluating a brand extension opportunity. Whenever someone mentions this topic, marketers immediately start talking about ‘fit’ – how well the new category fits with the attributes of the existing brand.

For example, if a company makes pencils, extending the brand into erasers would be a good fit. While it is rarely this simple, the concept of fit in brand extensions is pretty straightforward and can easily be confirmed with some basic consumer research.

There are two deeper strategic questions that need to be included when evaluation a brand extension:

  1. Does the extension category align with the strategic path that the brand is on?
  2. Would a successful product in the extension category add value to the master brand?

Alignment with the Strategic Path

Few brands are able to survive selling the same product forever. Brands usually need to extend themselves into new markets to allow for growth. Each individual extension of the brand is one step along this path. Thus, when evaluating your next step you must understand the longer path that your brand is on.

For example, before the iPod, Apple just sold computers. Extending to portable music players was a good fit because their laptops already provided portable devices that emphasized creativity. But at this time, jumping from laptops to cell phones would have been a step too far. Once the iPod had become successful, the overall Apple brand included small, handheld devices allowing them to further extend in this space – hence the iPhone.

The same could be said for the iPad. Jumping from an iPod to an iPad would have been too much of a stretch, but having the iPhone and iTouch in between made a tablet product a logical next step. Each new Apple product is the logical next step that also paves the way for the step after that.

Enhancing the Master Brand

Brand extensions can be loosely placed into two groups: those that dilute the master brand and those that enhance it. If Heinz launched a 58th flavor of ketchup it would dilute the brand. The Heinz master brand doesn’t improve but it is now spread across more product.

Using the Apple example again, each brand extension enhanced the overall Apple brand and each new product was a step on the path toward creating a master brand about lifestyle entertainment. The launch of the iPhone improved the brand for iPods and laptops too.

What do you think? Is fit enough for brand extensions or should brands seek more value?

Written by benwisebranding

April 12, 2010 at 8:18 pm

Extending the Google Brand

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I recently wrote about the shift in internet use that is being brought about by mobile devices and mobile applications. In a nutshell, users are not going to be searching the internet for content, but rather relying on a select number of mobile apps that take them directly to what they want. For example, using the Wikipedia app instead of a traditional internet search.

The Google brand stands to suffer from this shift more than any other. Although Google continues to release exciting new products, including ones for mobile devices, nearly all of its revenues still come from search advertising. With a drop in search, Google’s revenue from this service will undoubtedly drop.

Luckily, at least for fans of the Google brand, the company is preparing for this shift. The Android mobile operating system is one example, but this can also be seen in efforts to monetize other Google products. Google recently introduced location-based ads to their Google Maps in Australia, a product that is regularly used on mobile devices.

One of the great strengths of the Google brand is its ability to adapt. Google has such a hold over search that people use brand name as a verb (“I’m going to Google it”), but they have also successfully expanded the scope of their brand to include other areas of the digital world. This isn’t limited to different products and services online. The Nexus One (aka the Google Phone), fibre optic networks, TV advertising – these are all examples of Google’s ability to continually extend their brand.

Google is able to accomplish this because they have built their brand around a benefit, not a product. Google is about helping people access information, whether through search, maps, online documents, and whether on their laptops, mobiles or televisions.

While other brands focus on a specific product, Google’s wider approach to their brand has given them to freedom to enter markets that other companies can’t because they are limited by their brand. You could even take the Google brand a step further and say the benefit it provides is the feeling of empowerment through knowledge, moving their brand from a functional to an emotional benefit.

Maintaining an emotional benefit in the minds of consumers is certainly not easy, but for brands that are able to accomplish this, the benefits can be great. An emotional benefit is much harder for a competitor to match than a functional one. Your product may be the fastest, but another brand could easily usurp that position. If your brand makes me feel safe, that is much harder to replicate. Apple makes you feel cool, Budweiser makes you feel manly, and Google makes you feel smart – great brands all playing on emotional benefits.

What do you think? Will Google’s brand let them adapt to a world without search?

Written by benwisebranding

April 8, 2010 at 10:25 pm

Collaboration Gives a Brand an Advantage

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­With early reviews of the iPad hitting the blogosphere, Google has announced that their Chrome browser will now have Adobe Flash built-in. In case you haven’t read any reviews of the iPad, one of the biggest areas of contention is the lack of support for Flash.

It is easy to view this as a swipe at Apple (see here), and in many ways it is.

But at a deeper level, this is a profound statement about the Google brand. While Apple chooses to develop almost everything themselves with Steve Jobs holding the final decision of everything, Google works in a more open and collaborative way. This distinction should carry great weight with consumers.

Apple and Steve Jobs have been very good at understanding and addressing (and creating) consumer needs in the past decade. The iPod and iPhone have been revolutionary. But how long can a brand last if they plan on continually developing revolutionary ideas internally? At some point, you need to widen your pool of ideas.

This is where Google thrives. When they launch a product, they often do so in some sort of Beta form and are quick to make adjustments based on consumer feedback. Throwing their weight behind Adobe’s Flash shows they are willing to work with others to improve their own products. This might not deliver the creative spark of genius that Apple has used in their product development, but in the long-term it will satisfy consumer needs far better.

Google’s action show that it understands that their brand encompasses their entire business system, from product development, to marketing, to distribution. Collaboration is an essential part of Google’s brand system at all levels.

Apple may be everyone’s favourite brand right now, but it is the open and collaborative brands like Google that will see the most success.

What do you think?

Written by benwisebranding

April 1, 2010 at 4:51 pm

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Amazon Devalues Their Brand

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After a lengthy battle with MacMillan, a big publisher, Amazon conceded to their demand to stop selling their e-book titles at the low price of $9.99. The specifics of their dispute are another matter, but the end result will surely hurt the brand of Amazon’s e-book reader, the Kindle.

From the consumer’s point of view, the reader is produced by Amazon and the book is produced by MacMillan. A classic fight between hardware and content. As has been seen in the past, the loser of the fight often becomes the producer of a commodity product while the winner can charge a price premium garnering high profits. Think of PCs – Microsoft was the big winner on content while the HP, Dell, IBM and others continue to duke it out over what has essentially become a commodity. By giving in to MacMillan, Amazon may have sent the Kindle down a similar path.

Will this happen to Amazon’s Kindle? There are arguments on both sides of the coin. Amazon not only produces and sells the hardware, but is the retailer of the content too. Even if the Kindle were to become a commodity product they would still benefit from increased adoption and sales of the e-books. While the Kindle brand would be diminished, Amazon would still benefit.

The second factor is the recent introduction of the iPad by Apple. Apple has maintained a differentiated computer/laptop product and could easily do so in the e-book space as well by leveraging their innovation capabilities. This could relegate the Kindle, along with all the other new e-book readers, to the commodity arena.

As proof of the diminished power of the Kindle brand, News Corp is already pushing for the same deal given to MacMillan. I’m sure they won’t be the last ones to do so.

What do you think? What does the future hold for the Kindle?

Written by benwisebranding

February 4, 2010 at 4:49 pm

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Why Nokia’s Entertainment Play Will Flop

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Nokia, the world’s largest producer of cell phones, is planning to extend their footprint in the smartphone arena with an increased focus on entertainment, an extension from their existing emphasis on music. In a report in Marketing Week, the head of Nokia UK said “Offering total entertainment solutions and bringing entertainment to life is our new brand vision”.

This brand positioning is a mistake. While entertainment on your phone is a compelling value proposition to consumers, this space is already dominated by Apple’s iPhone. The iPhone brand is just too powerful in the entertainment position for Nokia to make inroads in this space. If Nokia’s “With Music” couldn’t compete with the iPod, why would their new position stand a chance against the iPhone?

When determining the brand position or value proposition, it is not enough to simply find a compelling position. The uniqueness is just as important, if not more so. In some instances, a second player can gain ground in the same space as a competitor, but they have to offer something unique. As far as I can see, Nokia is trying to emulate Apple’s smartphone strategy without having the innovative culture required to lead this market.

What do you think? Will Nokia’s new brand position be successful?

Written by benwisebranding

February 3, 2010 at 8:12 pm