Leadership Brands: How The Right Strategy Can Beat The Un-Economy . April 14, 2009 Minneapolis AMA

Welcome To The “Un-Economy.”

“ In the industrial era, we were good at creating perceived value. But now people are getting back to basics and the future of marketing is to create real value.” Umair Haque Director, Havas Media Lab

Umair Haque

Director, Havas Media Lab

For any brand, “Decisions are made emotionally and then justified rationally.” - Dr. Daniel Goleman Harvard/NY Times “ Decision-making is feelings-based, not solely rational. When the ventromedial prefrontal region of the brain is damaged, subjects are unable to make decisions.” - Dr. Antonio Damasio UC Berkeley, Neurologist

The Biggest Brand Trap Of The Un-Economy. VALUE = Functional Benefit PRICE

Leadership Brands 295,589

“ If your actions inspire others to dream more, do more and become more, you are a leader.” - John Quincy Adams

The Four Defining Characteristics Of Leadership Brands. Do More Address the value equation by emphasizing greater benefits vs. lower price. VALUE = FUNCTIONAL BENEFIT Price

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

The Four Defining Characteristics Of Leadership Brands. Do More Address the value equation by emphasizing greater benefits vs. lower price. 2. Dream More They create value through values.

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

2. Dream More

They create value through values.

Tait Subler’s Values Ladder. Movement Values Connection Emotional Connection Product Features/ Functional Benefits Elasticity, Loyalty, Margins Source: Tait Subler, Giep Franzen, Mark Earls.

The Four Defining Characteristics Of Leadership Brands. 3. Become More They provide an aspirational badge (user image) for their customers that promises transformation. Do More Address the value equation by emphasizing greater benefits vs. lower price. 2. Dream More They create value through values.

3. Become More

They provide an aspirational badge (user image) for their customers that promises transformation.

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

2. Dream More

They create value through values.

Tait Subler’s Transformational Badge Model. Who the consumer hopes to become through the brand. Transformational Benefit Reinforce a positive self-image for the consumer. Internal Badge How the consumer wants to appear to others. External Badge What the product does. Functional Features/ Benefits Transformative Power Loyalty, Margins

The Four Defining Characteristics Of Leadership Brands. Actions That Inspire Tangible actions that solve (or come closer to solving) the intractable customer problems in their categories, sometimes by inventing a new category.

Actions That Inspire

Tangible actions that solve (or come closer to solving) the intractable customer problems in their categories, sometimes by inventing a new category.

The Four Defining Characteristics Of Leadership Brands. Actions That Inspire Tangible actions that solve (or come closer to solving) the intractable customer problems in their categories, sometimes by inventing a new category. Translate a Badge/ Values based strategy into tangible execution. Become More They provide an aspirational badge (user image) for their customers that promises transformation. Do More Address the value equation by emphasizing greater benefits vs. lower price. 2. Dream More They create value through values.

Actions That Inspire

Tangible actions that solve (or come closer to solving) the intractable customer problems in their categories, sometimes by inventing a new category.

Translate a Badge/ Values based strategy into tangible execution.

Become More

They provide an aspirational badge (user image) for their customers that promises transformation.

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

2. Dream More

They create value through values.

Live The Same Strategy Inside The Organization And Outside.

The Tait Subler Concept Of Brand Theme. Brand Theme = Positioning + Mission Consumer Brain Employee Brain Mission Positioning

BRAND THEME Communication Manufacturing Distribution HR/ Hiring Packaging Design Investment Strategy Partners Product Development

At The End Of The Day, All This Simply Means That Leadership Brands Are Differentiated In Important Ways. Actions That Inspire Solve the intractable problems of the category (or start a new category). Translate a Badge/ Values based strategy into tangible execution. Drive behavior changes through a Brand Theme. Become More They provide an aspirational badge (user image) for their customers that promises transformation. Do More Address the value equation by emphasizing greater benefits vs. lower price. 2. Dream More They create value through values.

Actions That Inspire

Solve the intractable problems of the category (or start a new category).

Translate a Badge/ Values based strategy into tangible execution.

Drive behavior changes through a Brand Theme.

Become More

They provide an aspirational badge (user image) for their customers that promises transformation.

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

2. Dream More

They create value through values.

The Tait Subler Brand Leadership Model. How do we solve the intractable problems of the category (or start a new one)? Action That Inspires Who could the consumer become through this brand? Transformational Badge (Become More) What do we believe in? How do we want to improve the world? Why do we do what we do? Values Connection (Dream More) What do we make that adds value? How? Functional Benefits (Do More) Greater Differentiation & Greater Relevance

How Apple Works In This Leadership Brand Model. TOOLS FOR CREATIVE MINDS iMac iPod/iPhone iTunes Apple Store Action That Inspires “ I have a ‘creative mind’.” Transformational Badge (Become More) We believe in the power and value of creativity. Values Connection (Dream More) Simpler technological tools. Functional Benefits (Do More) Greater Differentiation & Greater Relevance

TOOLS FOR CREATIVE MINDS

iMac

iPod/iPhone

iTunes

Apple Store

It’s This Simple … And This Hard. Irrelevant Undifferentiated Differentiated Leadership Brands Most Brands in 2007 Many Brands in 2009 Relevant

The Facts Are In: Leadership Brands Way Outperform. 48 of 51 categories studied by Greenfield/ Copernicus were becoming less differentiated to consumers (2006). Upwards of 80% of all new brands fail. Lack of differentiation was cited as the number one reason (Ernst & Young). SOURCE: Y&R Brand Asset Valuator (40 countries/19,800 brands/185,000 respondents); Stern Stuart % Outperform for Differentiated Brands +50% +270% +250%

48 of 51 categories studied by Greenfield/ Copernicus were becoming less differentiated to consumers (2006).

Upwards of 80% of all new brands fail.

Lack of differentiation was cited as the number one reason (Ernst & Young).

An Original Brand Theme, May Seem “Risky” But It’s The Only Road To Success. Differentiated strategy requires original thinking and creativity in strategy development.

Is Hyundai A Leadership Brand? Solve the intractable problem of the category. “ I can’t buy a car because I’m afraid I’ll lose my job.” Provide an aspirational badge that promises transformation. “ You’re not a loser – we’re all scared.” Create value through a values connection. “ We’re all in this together.” (the reason why for the promotion) A tangible offer that focuses on BENEFITS over PRICE in its Value Equation. A compelling, original offering that isn’t about a discount at all.

Solve the intractable problem of the category.

“ I can’t buy a car because I’m afraid I’ll lose my job.”

Provide an aspirational badge that promises transformation.

“ You’re not a loser – we’re all scared.”

Create value through a values connection.

“ We’re all in this together.” (the reason why for the promotion)

A tangible offer that focuses on BENEFITS over PRICE in its Value Equation.

A compelling, original offering that isn’t about a discount at all.

Biggest Leader =

You Don’t Have To Look Very Far To See The Intractable Consumer Problem In Consumer Electronics. Blue Ray or HD DVD? CD or MP3? Mac or PC? LCD or Plasma? Wii or Xbox?

Blue Ray or HD DVD?

CD or MP3?

Mac or PC?

LCD or Plasma?

Wii or Xbox?

TechnoStress? TechnoStress , noun: A modern disease of adaptation caused by an inability to cope with the new technologies in a healthy manner. “ Technology keeps coming at us and we are told that we must adapt or fall behind. Yet no one escapes. Even the techno-savvy feel TechnoStress.” From TechnoStress Michelle Weil Ph.D. and Larry Rosen Ph.D.

“ Technology keeps coming at us and we are told that

we must adapt or fall behind. Yet no one escapes.

Even the techno-savvy feel TechnoStress.”

From TechnoStress

Michelle Weil Ph.D. and Larry Rosen Ph.D.

In This Environment, Consumers Want A Trusted, Objective Point Of View That No Manufacturer Can Offer. Retail Brand Provides Perspective Manufacturer A Manufacturer B Manufacturer C Integrate Competing Visions/Pdts Leadership The Visionaries Create, innovate, invent. Silos/Competing “Visions.” Provide Options Personalize Re-assure Help me define myself

The Best Buy Brand Had A Unique Opportunity To Fill A Leadership Vacuum In The Category. But leadership will be defined based on Best Buy’s uniquely “ big picture ” vantage point on the whole technology and entertainment category. Consumers need this uniquely “big picture” perspective more than another narrow “grand vision.” They also want re-assurance from a trusted brand that can reduce the stress related to a category with one foot always in the fuzzy future. Consumers want a badge benefit from this leader brand. Who is the aspirational user that will inspire a broad swath of consumers?

But leadership will be defined based on Best Buy’s uniquely “ big picture ” vantage point on the whole technology and entertainment category.

Consumers need this uniquely “big picture” perspective more than another narrow “grand vision.”

They also want re-assurance from a trusted brand that can reduce the stress related to a category with one foot always in the fuzzy future.

Consumers want a badge benefit from this leader brand.

Who is the aspirational user that will inspire a broad swath of consumers?

So, We Understood What The Best Buy Brand Theme Would Need To Address If They Were To Become A True Leadership Brand. Best Buy’s Unique Leadership Perspective The Aspirational Person Who Shops At Best Buy (The Badge) Best Buy Brand Theme

The Leadership Brand Model Helped Us Define The Brand Theme. Action That Inspires Transformational Badge (Become More) Values Connection (Dream More) Functional Benefits (Do More) Greater Differentiation & Greater Relevance

Let’s Fill In The Model For Best Buy. Action That Inspires Transformational Badge (Become More) Values Connection (Dream More) Functional Benefits (Do More) Greater Differentiation & Greater Relevance An all-seeing trusted perspective on technology that enables you to live a fuller, richer life that inspires others. We believe in the power of technology to help you achieve your dreams. A window on the whole world of technology and entertainment, with people/ tools to personalize solutions.

Remember, This Is The Structure Of The Brand Theme We Were Developing. Best Buy’s Unique Leadership Perspective The Aspirational Person Who Shops At Best Buy (The Badge) Best Buy Brand Theme

The Best Buy Brand Theme… Action That Inspires Transformational Badge (Become More) Values Connection (Dream More) Functional Benefits (Do More) Greater Differentiation & Greater Relevance TRUSTED PERSPECTIVE FOR INSPIRED LIVING Blue Brand Best Buy Mobile Geek Squad inside the Best Buy brand An all-seeing trusted perspective on technology that enables you to live a fuller, richer life that inspires others. We believe in the power of technology to help you achieve your dreams. A window on the whole world of technology and entertainment, with people/ tools to personalize solutions.

TRUSTED PERSPECTIVE FOR INSPIRED LIVING

Blue Brand

Best Buy Mobile

Geek Squad inside the Best Buy brand

Brand Obama.

Is Obama A Leadership Brand? Solve the intractable problem of the category. “ Change vs. Status Quo; you can’t change Washington by electing a creature of Washington.” Provide an aspirational badge that promises transformation. “ Young, smart, hip” vs. “Old Washington”. “ Yes we can!” Create value through a values connection. Change We Can Believe In – America is about equal opportunity. A tangible offer that focuses on BENEFITS over PRICE in its Value Equation. An “outsider” who clearly was different … Policy consistent with the rhetoric (tackling the challenges left untouched by previous administrations, regardless of cost.)

Solve the intractable problem of the category.

“ Change vs. Status Quo; you can’t change Washington by electing a creature of Washington.”

Provide an aspirational badge that promises transformation.

“ Young, smart, hip” vs. “Old Washington”.

“ Yes we can!”

Create value through a values connection.

Change We Can Believe In – America is about equal opportunity.

A tangible offer that focuses on BENEFITS over PRICE in its Value Equation.

An “outsider” who clearly was different …

Policy consistent with the rhetoric (tackling the challenges left untouched by previous administrations, regardless of cost.)

Can Your Brand Become A Leadership Brand? Actions That Inspire Solve the intractable problems of the category (or start a new category). Translate a Badge/ Values based strategy into tangible execution. Drive behavior changes through a Brand Theme. Become More They provide an aspirational badge (user image) for their customers that promises transformation. Do More Address the value equation by emphasizing greater benefits vs. lower price. 2. Dream More They create value through values.

Actions That Inspire

Solve the intractable problems of the category (or start a new category).

Translate a Badge/ Values based strategy into tangible execution.

Drive behavior changes through a Brand Theme.

Become More

They provide an aspirational badge (user image) for their customers that promises transformation.

Do More

Address the value equation by emphasizing greater benefits vs. lower price.

2. Dream More

They create value through values.

www. tait subler .com

THANK YOU.