The Perils of Lifestyle Branding

Extending a brand beyond the borders of your product category has a lot of opportunities. Here's a study that brings out some substantial threats of such an extension - cross-category competition for one.

Why an e-mail can go sour in no time

Here's a brief article on the hazards of electronic communications. I've had some occasions myself when exchanging e-mails has made things much worse instead of solving them - although that was their intension.

Not being a big fan of emoticons (and still opposing over-using them), I read this piece through carefully.

Innovatsioonist ilma Apple'i näiteta

Brand Manual on pea kaks aastat aidanud ettevõtetel parandada oma konkurentsieeliseid. Üsna pea tajusime, et vastuseis meie mõtetele tuleneb sellest, et brändingu nime all on ettevõtetele müüdud logo joonistamist ning sisuline töö on jäetud tegemata.

Sestap panime kokku oma koolituse, Branding ABC, kus lahkasime sõnastatud konkurentsieelise temaatikat. Oleme koolitust edukalt läbi viinud mitmekümne ettevõttega ja soovitame seda endiselt oma tulevastele klientidele kui ka kõigile, kes tahavad lisaks teoreetilistele aruteludele ka praktilist nõu saada.

Nüüd võtsime oma fookuse alla innovatsiooni. Kuidas toimub uuendusprotsess, mis seda takistab ja millised on universaalsed tööriistad selle läbiviimiseks. Me ei räägi radikaalsest innovatsioonist, leiutamisest, me räägime astmelisest innovatsioonist. Me räägime sellest, miks ettevõtted muutuvad kasvades innovatsioonivaenulikuks ja kuidas nende juhtkond ei saa sellest enne teada kui nende naftaplatvorm juba põleb.

Eelmise aasta lõpus viisime oma klientide seas läbi küsitluse, kus mitmed kliendid heitsid meile ette jäärapäisust. Samas toodi meie põhimõttekindlust välja kui tugevust, mis võimaldab kord ette võetud tee lõpuni käia. Kui soov on kaalust alla võtta, siis aitab sihikindel treener.

Seesama oskus minna oma ideede elluviimisel lõpuni välja on see, mille oleme nüüd vorminud päevaseks koolituseks, mil nimeks Innovatsiooni ABC. Kavatseme selle ka materjalina üles riputada, kel aga suurem huvi, võib saada osa meie testkoolitusest, saates meile kirja.

Üks märkus veel. Oleme oma suhtluses läinud üle inglise keelele puhtpraktilistel kaalutlustel. Meie teenuseid vajavad Eesti miljonist elanikust 1%, samas on meil maailmas miljon potentsiaalset klienti, kellest vaid 1% räägib eesti keelt.

Innovate or die: but how?

Image courtesy of 15/30 Research

Companies that continuously come up with new and exciting stuff have one thing in common: little management and lots of leadership. The company has a goal, everyone knows what the goal is and does their part, in helping the company achieve that goal.

The cumbersome, not-fun, uninspiring company has a plan. Everyone in the company has a job to do. "Your part in the great plan is to serve customers water." Management has reduced every task to a manual. There is a clear hierarchy and everything is being measured for efficiency. Redundancies are quickly eliminated. People work to prove their importance for the plan, but no one knows what the goal is. Turf wars are more important than customers.

The former company innovates daily. The latter company optimizes daily.

The danger to the former company is to become like the latter company. The latter company is likely to become extinct. You can blame management for both scenarios.

Managers optimize. Leaders empower. Innovation requires both, but if management and optimization becomes too important then innovation will disappear. Innovation requires that people are motivated about their jobs and that they continuously think about what could be done better AND that they have the power to implement their ideas. Management doesn't like unstructured, unplanned activities because they are inefficient.

People having inspiring ideas are inefficient, because they won't have the ideas on schedule. That messes up the whole production cycle. Therefore if the manager has to approve a budget for the engineers to come up with improvements but he's not sure that the engineers will be on time or on budget, then it's easier to say no to the whole thing. After all, no manager has been fired for reducing risk. Of course, in three years time, when the company is about to go out of business because there hasn't been a new idea for 10 years, taking risks will seem awfully safe.

Innovate or die: but how?

Innovation can be learnt. Innovation depends on people who can be empowered. Innovation depends on communication and trust, which can be built up again. Innovation depends on leadership, the right of which can be earned. Innovation cannot be managed, it must be allowed to thrive. Innovation pays off in the long-term. Continuous innovation pays off continuously. Optimization pays off in the short term and over time, less and less.

We developed Innovation ABC following the success of our Branding ABC course. Whereas Branding ABC looks at how brands are built in companies, involving the whole company then Innovation ABC looks narrowly at the process of coming up with new ideas.

• How to build up a company structure that supports innovation and nurtures it.
• How to keep the business focus on the idea, not the method of execution of the business plan.
• How to motivate people and how to work with them so that innovative ideas just happen.
• And most importantly, how to handle the fuzzy front end of innovation projects, where you don't know where you're going, how you're going to get there and how it is all going to end.

For more information check out our website.

Merry Christmas Experiment

A phone call from a confused client inspired us to make public, and thus conclude, our little Christmas card experiment. We had almost completely forgotten the whole thing, since it all took place more than 6 weeks ago. It appears, however, that due to the "good" service of global postal companies there is still plenty of room for late Christmas greetings and pleasant surprises. So be sure to check your snail-mailboxes every now and then.

On December 13th we posted three different postcards (see the winter magic above) with Brand Manual's best wishes to our clients and friends from 10 different locations all over the world: Estonia, Russia, Portugal, USA, Malaysia, Australia, United Arab Emirates, Sweden and God knows where (we really don't remember the last two locations ;). So it was a random lottery for the recipients, when and from where they would receive their three cards, and apparently it is still happening, as a card from UAE finally made it to one of our Estonian clients 2 days ago. Only to be followed by another one from Kuala Lumpur that made it to Tallinn today. Who knows how many cards are still on their way or have been lost on their quest of getting together the big picture.

For those that are still waiting for their set of cards or want to pay their tribute to the ones that went "missing in action", here's copys of all three of them.

PS. How did the 4 of us manage to post cards from 10 different locations, thousands of miles apart, all at the same time? Send us a postcard when you figure it out!

The future of transactions

Service design has a lot to do with future scenarios. A few months ago we developed the initial identity for ParkNOW!, a pay-by-cell phone parking payment operator in the US. During that project we talked a lot with them about different payment methods, and NFC (near-field communication) got mentioned too. In fact, all major mobile phone manufacturers have white papers on it and are working on making the technology usable.

NFC enables devices to talk to each other when they're close enough. It can let you share contacts, pictures or whatever data you want. The killer app though, is payments. Using your mobile phone (cell phone in the US) as wallet. In short, this will revolutionize monetary transactions in near future. And as always, for existing industries (banks) it will happen faster they can say "return on investment".

A few days ago, Financial Times published an article saying that Apple would incorporate NFC technology in their iPhone 5, which is due this fall. Surfing around the web seemed to confirm the story, because this week has seen a flurry of articles about the iPhone 5 and iPad 2 incorporating NFC. The really big deal is this, however: Apple has through iTunes credit card information on over 100 million people. This makes NFC not only a cool technology, but for Apple customers also an immediately available payment system with enough people tied to it, that for retail operations this can represent critical mass. Retail outlets therefore, will be highly incentivized to install NFC payment terminals in store. (Starbucks has, in fact, aldready developed an app for the iPhone to enable their customers to pay faster using their phone.)

This is what banks are charging for. (Image: Wikipedia)

The real impact of NFC payments, digital wallets and eventually peer-to-peer transactions using NFC will be felt in the bank. Banking relies on charging incremental fees from customers who are moving their own money around. Additionally banks earn interest lending out people's money. Purely digital money, manipulated directly by customers themselves, without a third party being involved, can represent a paradigm shift in transaction infrastructure.

Money, after all, was invented to facilitate trading. It was more effective than barter, because the relative value of each item was difficult to gauge. Money provided an independently assessable equivalent that was a lot cheaper to manage than barter trades. Today, money is everywhere. However, in reality money is like fixed line telephony. Developing nations don't bother to install telephone lines – they go directly to mobile phones. Similarly, the internet is not really being accessed by computers in developing nations but is used on smart phones, which are cheaper and simpler to use and need less fancy software. What if money, like fixed line telephones, is a legacy system that can be skipped?

In Africa, a mobile operator enabled their customers to send and receive money via an SMS system. There were few banks, with even fewer branches in rural areas making it difficult for people to trade with each other except by using cash. Credit cards aren't available and even if you've got one there is no guarantee that the store will accept it. This lead Safaricom to develop MPESA, a micro-payments system and Wizzit to provide mobile banking. From being on the fringes of the banking business, they have now effectively changed consumer's understanding of what banking is, and are leading the debate for the whole industry.

For early adopters, PayPal has introduced the mobile-to-mobile payments app. The talk of "can it be done" is already yesterday's news. With Apple's client base we are also over the "are there enough people to use it" question. So banks, thanks for all the fish.

Change Hurts

There has been a lot of discussion lately about changing identities of the world-famous brands. Well, the fuss has always been up in forums, but with social media gaining more public attention some logo redesigns have become matters of global importance. Namely Gap, Starbucks, Tropicana.

John Nunziato, the author of the featured article tries to cool the (often anonymous) crowd down. Changing a logo is influenced by so many factors that the "like-unlike" scale is just not a sufficient judging criteria. Critics often (mostly) have no clue what's behind that symbol replacement. Getting even the smallest amendments through is a long and painful process, especially in big corporations.

The situation here is Estonia is often quite the opposite, paradoxically. Marketing departments of locally famous brands quite too often regard radical identity change as a remedy against business slowdown. We at Brand Manual have a few examples of projects that start with a "we need a new logo" brief - and ending with a thorough fix of their current identity. You get bored by your face long before your customers do - that's the mantra we keep repeating. Look at Budweiser, it has kept the same appearance for the past 140 years - and is still one of the greatest brands there is (you have to admit that, even if you don't like the beer). I struggle to find a good domestic analogue, though.

The bottom line - just changing your brand's identity wouldn't improve your business, period. But when your offer has really risen to the next level, then a logo refreshment can be a pretty effective way of getting attention. Especially if you have fans (and aficionados are attracted by great service, not a logo).