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Herding Cats vs Building Brands: Adding Value Through Strategic Brand-Building

Zoë Couper & Liz Nickles

Carte Blanche Communications

3 May 2006

Brands and cats have very little in common. Cats are fuzzy. Let's hope your brand isn't. Cats sleep a lot. If your brand does, you're in trouble. Cats have nine lives. Your brand does not. No matter how much you spend on a pedigree cat, it is not going to be good at falling into line and learning synchronized swimming. And, as far as your brand is concerned, it doesn't always matter how illustrious your firm's pedigree, or how much is spent on fluffing it up – it might not perform as you'd like. Here's proof: In 2005, a global research study called the Brand Barometer revealed that consumers worldwide do not even recognize seven of the top 20 global financial service brands. Meanwhile, in the US alone, financial institutions spent $9.45 billion on marketing in 2004. Then again, in today's environment of constant change, consolidation and message bombardment, is it all that surprising? Branding Branding does not live on marketing alone. Or, in some cases, at all. Just as you can't turn a cat into a tiger by painting on stripes, you can't build, or even maintain, a great brand without dealing with its DNA. Whatever you see outside the brand - the logo, the marketing, the advertising, the client entertaining - is only as strong as what's happening inside. Great brands are built neither on catchy slogans nor on the 18th green of St. Andrews or Pebble Beach, but on people. Great brands are built from the inside out. Walking the Walk, Not Just Talking the Talk The fact is, marketing can work at cross-purposes if the organization doesn't deliver on the message. Sounds simple enough. Why, then, have so many brands failed at this process? Consolidation and expansion, which breed brand proliferation, are a global fact and key to business growth, but they can lead to spaghetti bowls of communications themes and messages. Beginning in the mid-nineties, for instance, Deutsche Bank began an aggressive cycle of consolidation and brand expansion. This had a diffusion effect on communication and led to brand confusion. In 1995, a direct banking subsidiary was launched with its own name and slogan, followed by the launch of a middle market private banking subsidiary with yet another theme. In the late nineties, Deutsche Bank made acquisitions including Morgan Grenfell and Bankers Trust. In 2002, all brands were consolidated under the Deutsche Bank name, but the ripple effect of market confusion had made an impact. For instance, a survey among executives by PricewaterhouseCoopers in autumn 2005* revealed that Deutsche Bank had fallen in the critical aspect of respect from 62 per cent agreement in 2003 to 43 per cent in 2004. Perhaps not coincidentally, in 2005, a major global brand campaign was launched, themed "A Passion to Perform." United Airlines built a megabrand around promises built largely of - well, air. While advertising touted friendly skies and happy trails, the experience and the employees delivered the polar opposite. And it was all the worse, since United was employee-owned. Result: disaster. Stakes: share prices that plunged to the basement. But in branding, there is more than one way to skin a cat. Sir Fred Goodwin led RBS in a stunning string of global acquisitions spring boarded by the acquisition of NatWest in 2000. RBS brand strategy has not followed the prevailing pack to unite all brands under one Citi-like umbrella, but to retain the individual identity and integrity of the acquired brands. RBS corporate brand communications have been strategically targeted to the investor and institutional community, avoiding overlap and brand confusion. Marketing dollars behind the corporate brand were not diffused - or confused. Although the share price has not been an unbroken upward continuum, overall brand performance speaks for itself as RBS dividends jumped 25 per cent last year, and pre-tax profits climbed 21 per cent, while overall profits for the past three years have tripled. Goldman Sachs, on the other hand, has built a gold standard brand without relying on advertising at all. You could probably put the entire historical Goldman Sachs marketing budget into the seat pocket of one of United's jumbo jet ad budgets. There are no catchy slogans or music themes. Just results. There are no ads asking for business, yet they're always on the pitch list. Amazingly, Goldman Sachs is quite open about their secret. It's right there on the first page of their website, for all to see: "The Goldman Sachs culture is what sets our company apart from other firms and helps to make us a magnet for talent." After years of aggressive growth, Nike hit a wall and recognized a need to realign employees with their brand. After an extensive consideration of options, the company surfaced a series of maxims that revolved around its core beliefs of the brand and how it relates to the daily functions of employees, which were rolled out internally through a series of high profile events. This company didn't just tell customers to "Just do it." They "just did it" themselves. What’s the R.O.C? (Return on Culture?) Given the proven impact and value of culture, it's amazing that, at some firms, it continues to be relegated to "the soft stuff" side of the page. Here's a concept: there is actually a measurable R.O.C. per employee. The formula is simple: R.O.C. = net revenues ÷ number of employees Because, without those employees, the revenues of any organization equals zero. Focus on culture as a brand tool does not have to involve a Hollywood production. But it does have to involve content and commitment. At Goldman Sachs, for instance, it involves six core values and fourteen business principles, accompanied by a "top 10" checklist of informal precepts that have been handed down intact over the years from CEO to CEO. Management and global changes may have caused evolution, but never dissolution of what the firm stands for. The result is a rock-firm brand, and the inarguable added value that brings with it. Let’s Take the Elevator Elevators do more than take you up and down. They also can do something scientists would envy - they can give you an instant read on your Brand DNA. Forget about the four page op-ed piece in the FT or the WSJ. Reality is that the length of the elevator ride is usually all the time you have for someone to tell your brand story. To answer critical questions like: "What's this place like?" "What's the firm's focus?" or the Mentalist Mind Reader Special - no questions asked or answered, just an expression observed on a face that says it all without words. That's all it takes to send a brand message. Then the world's most effective media, the grapevine, kicks in. From the elevator - or coffee machine, or cocktail party, or pub, or the club lounges from Heathrow to JFK to Frankfurt Rhein-Main - the message, whatever it is, will spread like wildfire. Do you know what your message is? Is it what you’d like it to be? Can You See Clearly Now? Governance issues have created an upsurge in business transparency. Yet cultural transparency is rarely as quick to follow. Without this, however, no organisation can fully engage, and no individual can fully commit. It's a rare organisation that consciously sets up smokescreens. Nonetheless, in the numerous global internal communications surveys we have conducted, employee focus vis-a-vis management goals are invariably not fully aligned. What does this mean? Let's eavesdrop on an actual conversation (all names changed here to protect the guilty) THE SCENE: LINE OF BUSINESS HEAD OF MEGA FINANCIAL ORGANISATION IS AT HIS DESK. HIS ASSISTANT BUZZES. THE FIRM'S BIGGEST CLIENT IS ON THE LINE. BUS. HEAD: Alan, how are you? Great hearing from you. BIGGEST CLIENT: Things are fine here. (SOUNDING CONCERNED) What about there? BUS. HEAD: Everything's going extremely well. (detecting something in client's voice) Why do you ask? BIGGEST CLIENT: Well, Robert, who works for you, called me the other day. BUS. HEAD: Good. BIGGEST CLIENT: Robert spent the first ten minutes of the call complaining about your firm. I thought you should know. BUS. HEAD: (MOMENTARILY SPEECHLESS) When internal alignment is off, so too is the brand. The Buck, Pound or Euro Stops Here Building and maintaining a bulletproof brand starts at the very top - the CEO and the management committee. The marketing department or even brand council can only execute something this team will stand behind. Without clear signals and a stake firmly in the ground at the top, the brand will drift and get blown off course by short-term issues and the strategy du jour. Top management needs to provide the spine, the religion and the tools. As the CEO goes, so goes the organisation. And the brand. The competitive edge In a performance-based culture, brand can give the competitive edge that leads directly to the bottom line. But it can't be a Yellow Brick Road that leads to something that isn't real. Brand dynamics need to be measurable, deliverable, timely and accountable. A company's approach to brand management needs to be built for consistency and transparency. In the elevator, at the client, and everywhere it touches. Forget about herding cats - it’s your brand – let’s hear it roar. *Source: American Banker, August, 2005