How much would you pay for a pair of shoes? $3,400? Don’t gasp. For that’s the amount a lot of people cough up for a pair of “Manolo Blahniks”. His clientele is devoted, addicted and madly in love with his creation. Kim Kassel, a former New York fashion publicist owns more than 100 pairs and finds it difficult to buy any other brand.
When Ikea, the world famous Swedish furniture retail store giant, opened its first store in Atlanta (USA), you could feel the passion, the excitement people felt. One guy went to the insane extent of pitching his tent seven days before the opening so that he could win the $4,000 gift card. Before the doors opened, there already was a long line of 2,000 customers behind him.
Harley Davidson has the most dedicated customers who also belong to its 8,86,000 strong Harley Owners Group. They meet annually and discuss and enjoy their Harleys.
When Krispy Kreme opens its new store anywhere, some camp outside it overnight, others line up for hours for the first bite of its soft sugary doughnuts.
For music lovers, nothing can beat the iPod. An Apple store is the hottest destination for youngsters, for its loaded with cool stuff. When Apple puts on its MacWorld expo, thousands flock to it and walk around as if in a trance, dazzled by the beautiful creations. If there is one company that has totally turned all business rules upside down and shown the world what innovation really means, it’s Apple. These are “cult-brands”, that have won for themselves near-fanatic followership. These brands have become cult brands because they are selling not just the product but a dream, an aspiration, a passion. So how are such brands created?
Crazily Enterprising and Obsessive
That’s the new definition of a CEO who can make cult brands. Unlike earlier norms of financial know-how being the most important requirement for attaining the top-most position in an organisation, today, it’s the knowledge of marketing, and an excellent grasp over brand building strategies that companies are looking for. You need the top guy to be one who understands the importance of investing in Brand building. Since this does not always show results in the short-run & hence requires a long-term commitment from the top, all those companies that did that, are today reaping rich dividends. When you build a brand, you build a unique identity that consumers love and respect. This differentiation helps the company survive in the long run.
“Our stores have become a gathering and meeting place in addition to the coffee,” says Howard Schultz – the CEO of Starbucks, “Starbucks represents something beyond a cup of coffee,” he adds. When people go to Starbucks, they go to not just to have a great cup of coffee [which can be easily copied by various competitors], but to enjoy its unique culture – which is the heart of the brand [no one has ever been able to copy the heart & soul of a company].
Apple is loaded with engineers. Not just engineers, but ones who have the passion to “emote,” whose eyes light up when they discuss the product features. After all, Jobs is no ordinary CEO and hence he doesn’t hire ordinary people. His genius and his obsession have given Apple its unique environment of innovation. Steve Jobs is so crazily involved with his inventions that he considers it futile to do market research or focus groups. For him, new product development starts in the gut and takes form with the help of talks & discussions with equally obsessive team mates. It’s no surprise that this year, Apple ranks the new No.1 among America’s Most Admired Companies. It also ranks No.1 among Fortune 500 companies for total returns to shareholders over past the five years (94%) and past ten years (51%).
The leader makes all the difference. He creates an environment in his organisation, which is just right for developing and nurturing cult-like brands. Pick up any cult-brand and you will find behind it very-well-taken care of employees. That’s the first thing the leader does to start brand building. No organisation can even survive, forget about excelling, in this tough market environment if its employees – its first customers – are not taken care of. The next step is to invest in intelligent marketing strategies.
It’s a whole new world
The customer of today is different from the one of yesteryears. Today’s customer knows how to avoid marketing efforts directed to him. He has a caller ID on his telephone to block unwanted calls, a spam and pop-up blocker on his internet. He even has a TiVo which records his favourite TV programmes, minus the advertisements. Traditional branding models using traditional media will no longer work. As someone once said, “How do you become a millionaire? Become a billionaire and then buy an airline!” Then someone modified it & said, “buy a newspaper!” With advertising revenues dwindling steadily, traditional media like newspapers, magazines are singing their swan song too, making brand building more challenging.
When Wieden+Kennedy created the “Just Do It” campaign for Nike, TV & print helped spread the magic of ‘swoosh’ the world over. Today, Nike is finding itself out-of-sync with its target consumers, for they’re now tuning into different forms of media. It’s more the digital and interactive ones that have got them hooked. Almost all top brands today have started spending less & less on advertising. McDonald’s has cut its TV ads from 80% to 50%. Samsung, unlike Sony advertises on TV, only during the last six months of the year when sales peak.
Like most cult brands, Ikea too spends very less money on advertising. They prefer to generate a word-of-mouth. Johnson & Johnson, which traditionally spent a lot on TV & print, changed its media spending pattern last year. Plain advertising is no longer working and marketers need to look beyond the comfort of 30-second TV spots. The new generation is, in fact, averse to “in-your-face-marketing” efforts. One needs to think of novel ways of reaching out to today’s customers. Digital and interactive media seem to be the playgrounds for marketers in the future. It’s no coincidence that when Nike decided to expand its list of advertising agencies, it was not looking for the big ones, but those with interactive, digital and community-building capabilities. It even partnered with Apple and created an offer “Nike+iPod”, which virtually transformed running. Detroit’s carmakers, the long time pillars of print advertising, are recklessly chopping their print advertising budgets to curtail costs. Today, to survive, everyone needs to change their marketing habits and find new ways to connect with consumers.
It’s Asia’s time now
There was a time when the Big 3 of Detroit were GM, Ford and Chrysler. Whoever thought that today they would be replaced with the likes of Toyota and Nissan all Asian brands. There’s a trend. Consumers are quickly shifting from European and American manufacturers to Asian ones. China has already become the manufacturing hub of the world. However, it’s no longer satisfied with just being the “low-cost-factory” of the world. Brands are built on perceptions and most Asian brands are viewed as cheap-mass-produced goods. That’s changing. China, Korea have realised the importance of branding. Good products, well made products, will never help you survive, but a strong brand and unwavering brand loyalty from customers can help defeat competition. Using the Olympic as a new driving force, a whole lot of Chinese brands are working hard towards improving their brand identities like Lenovo and Haier. South Korean brands like Samsung are fast becoming the favoured brands of the new generation.
It’s difficult to build brands. When Hyundai first started its US operations, it was mocked at by all & even featured in the “Worst Car Ever Made” lists. It lost no hope & worked consistently towards improving its image; and today, it’s the 6th largest automaker in the world & even features in the Best Global Brands survey by Interbrand.
Different brands survive in different cultures. The good news for most Asian brands is that a lot of western brands, even the big ones, have not been able to survive on the Asian turf. Yahoo & Google may be world leaders, but in China, it’s “Baidu” that controls 57% of the Chinese search market, which incidentally is the world’s second largest Internet market. On the Indian shores, Maruti still seems to be the favoured brand when it comes to cars. Amul is still the “taste of India”. If it is the blogger community that works best in USA, which believes that everyone has the right to an opinion, then those are celebrity endorsements that work best in Asian markets in building brands. Asian markets have their own idiosyncrasies and if marketers can understand that, they can start counting the moolah as the Asian consumer today is ready to buy brands and pay a premium. He is aware and loaded! We need to start thinking about building stronger brands and making their presence felt worldwide. We need to inculcate a new culture. We have big powerful businesses but they have no global standing. It’s time to invest in branding, even “corporate branding” for times are changing.
A laptop without the Apple logo would not feel so good (even if it was identical to Apple). Where’s the charm in wearing a denim if it doesn’t sport the Levi’s tag. Yes, life without brands is not the same. Nobody wants just a great quality product, but a Brand name too. Shakespeare said decades ago, “What’s in a name? A rose with any other name would smell just as sweet.” Maybe not today. Brands are becoming the deciding factors in buying decisions. Probably Shakespeare needed marketing lessons too!
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