Archive for the ‘In The News’ Category

Is Toyota’s “Brand Insulation Effect” Protecting Its Sales?

March 9, 2010

In a recent study released by Rice University, of the Toyota faithful, “Toyota owners maintained a more positive view of the company than their counterparts.” Furthermore the survey found that…

“When Toyota owners were asked to rate on the same 0-to-10 scale whether they would consider Toyota if they were to buy a new vehicle today, their ratings averaged an 8, whereas other automobile owners’ ratings averaged a 4.”

The study’s author, Vikas Mittal, the J. Hugh Liedtke Professor of Marketing at Rice, and co-authors Rajan Sambandam, chief research officer at TRC, and Utpal Dholakia, associate professor of marketing at Rice, termed this a “brand insulation effect” built upon previous positive customer experience with the company.

If this is true, (and it remains to see if future customer actions support their stated intentions,) then it bodes well for companies that perform consistently over the long haul. Tylenol faced a similar challenge when they recalled millions of dollars of products off store shelves from a product tampering incident. Tylenol’s share reportedly dropped from 35% down to 8%, but quickly rebounded within a year. Consumers came back to Tylenol due in large part to their proactive response and proven history.

It will be interesting to watch Toyota and see if their brand image withstands this withering assault of news reports. What are your thoughts? Is there a “brand insulation effect?” Will it work for Toyota, or is this a case of too little, too late?

Apple’s iPad - Only One Chance to Make a First Impression

January 28, 2010

When the much anticipated, must-have, Apple gadget debuted this week it was met with a collective “huh?” Part of it was due to the branding. Instead of choosing a unique name that creates and/or redefines the category (like the iPod did), they went with a generic… a “pad,” as in notepad, pad of paper, ink pad, or worse (we’ll get to that later.) The problem with generic brand names is that they tend to minimize the product, and limit it to a predefined category. It’s as if people were saying “Oh, I get it… it’s some sort of electronic pad thing.” Once the brain thinks it has the answer, and knows where something fits, it tends to quit asking questions. And that’s the sad part of the story, because Apple is so great at creating intrigue and suspense. Even the rumored name iSlate would have been more imaginative than a pad.

And then there are the other issues…

• iPad sounds so close to iPod that it’s confusingly similar. Imagine if you were from Boston. The names would be interchangeable.

• Already the name has been subjected to derision by its close affiliation with certain feminine hygiene products. (Do you want the mini or the maxi?)

The initial jokes will wear off, so that’s not a big deal. What is a bigger deal is the lost opportunity cost that results from explaining/defending a name in the first few days of a launch. With a unique, compelling brand name, it may have encouraged potential buyers to inquire more deeply. A good example of this is what Amazon did with the Kindle and Barnes and Noble did with the Nook. Notice neither went with “e-reader” or some generic, functional naming solution. I realize Apple wants/needs to keep the “i” for its branding architecture. But it could have followed it with something more inspiring than a pad. As a company known for its creative brilliance, this is one brand name that fails to shine.

Is 2010 “the year” to expand your brand?

December 14, 2009

According to a number of economists, the coming year should usher in the much promised turnaround. One of the fears, expressed by our president and a number of leaders, is that businesses will have become so efficient and risk adverse, that they will resist new hiring and expansion.

That would seem prudent but could prove harmful in the long run. The reluctance to grow when the economy begins to improve is the equivalent to timing the stock market. By the time you realize that your customers are back, and buying, it may be too late to regain them. In other words, you might not have enough band width to handle the business, due to a number of factors…

• A reduced number of competitors weeded out from this down turn.

• A lack of suppliers which can help you fulfill orders

• A lack of staff to handle an increase in volume

Just as this economy caught business owners off guard and bloated with excess staff and inventory, it can do the same on the opposite side — make them too cautious to move when signs of improvement start to show. You will never have a better opportunity to gain “share of voice” for your brand than in a down market. Competitors are quiet and waiting things out. They are also hunkered down and looking for the same sustained sales results before investing in any type of growth. But it will be the businesses that can step up and meet this growth, right out of the gate, that will gain the most from the upturn. At that point, getting back in the game will require more expensive advertising.

If 2010 is “the year,” then what are you doing in anticipation of a possible uptick in business? Are you in hunker down mode? Or are you quietly lining up quality suppliers, keeping resumes current, and creating a plan of action to ramp up production in a short time frame? It’s a matter of being proactive vs. reactive, and it can happen on both ends of an economic cycle. If 2010 is the year, make sure it’s your year.

Radio Shack - The Problem With Product Identified Brand Names

August 7, 2009

The irony of naming a new company is that the quickest fix (giving the company a literal/descriptive name) creates the most enduring problem. Witness the latest iteration in “fixing” the Radio Shack brand. To bring it current, make it relevant, and shed its legacy image of radio/transistor/gadgetry, it’s now going to advertise itself as simply “The Shack.” This is similar to Pizza Hut’s attempts at rebranding itself as “The Hut.” The problem is systemic… the whole positioning itself is based on a product (radios) and a place (a “shack”) neither of which reflects well on the brand. This is the same problem encountered by CompUSA and Books-A-Million. They based their brand on a specific narrow product channel, and then spent years (and millions of marketing dollars) trying to break out of a self defined box.

This is one of those “live by the sword, die by the sword” types of branding decisions. Product specific names are great for gaining initial traction when first starting a business. Customers know exactly what you do (i.e. sell radios in small strip mall stores, sell computers in the United States, sell a million books, etc.) But when the company grows and expand its product offerings, (as they so often do,) the very name that helped define them now restrains them. The pain killer becomes the pain maker.

The solution? Look at companies that defined themselves by an attribute, such as Best Buy. Or ones that use a metaphor, such as Target or Amazon. These names provide a more lasting base to build upon. They allow the context to identify their products (i.e. their web page, their ad, their brochure, etc.) so the name can be freed up to evoke a bigger message.

So before you name your business The DVD Barn, be sure that is the only product you will ever sell.

Is BING the new thing? Rebranding Microsoft Live Search

June 1, 2009

Let’s face it… Microsoft has never been the leader when it comes to cool brand names. But that might be changing. This past week, the folks in Redmond, WA announced the new name for their improved search engine… Bing! You might say Bing has a ring to it, and it’s a heck of a lot better than their previous literal/descriptive name, Live Search (as in, “Could you ‘Live Search’ that for me?”) Or Kumo, their stealth code name, which sounded more like an Alaskan sled dog.

Bing is short and (like the cherry) sweet. It has has verb potential, almost like when you “ping” something, as in pinging a server. Whether it can replace the ubiquitous use of Google remains to be seen. It’s never easy when you are trying to unseat the leader, which by the way has a fairly good brand name already. A lot of it will depend on the service itself. Microsoft has improved the name, but have they sufficiently improved the product? Enough for folks to change old, establish search habits? Moving from number two to number one takes some doing… just ask Pepsi.

Here’s what makes that question even more interesting.

According to Advertising Age, Microsoft has $80 to $100 million planned to burn that brand name into just about any brain on the planet. That amount can easily pound a square peg into a round hole. Google has never faced a direct onslaught like this, and so it will be interesting to see how they respond in kind.

Swine Flu and the Power of Naming

May 4, 2009

For those who don’t believe that naming is powerful stuff, look no further than the latest pending pandemic, now known as the H1N1 virus. As humans, we have an inherent need to label things. It makes us feel safer if we can name something, identify it, box it in, put a handle on it. The problem comes when the need for that label becomes more important than the facts. According to the CDC, “It (”Swine Flu”) has two genes from flu viruses that normally circulate in pigs in Europe and Asia and avian genes and human genes.” In other words, it’s a swine, bird, human flu.

What difference does it make? Apparently quite a lot.

According to UPI, Egyptian authorities recently announced plans to kill 300,000 pigs as a preventative measure. The New York Times reports that consumers are not eating pork based on the misconception that they might get sick. Some farm groups are pushing to change the name to “North American influenza.” Others are pushing for “Mexican flu.” The problem is, as long as it’s called “Swine Flu,” people are going to blame swine. If we call it “Mexican flu, we’ll blame Mexico.” It’s just the way our brains work… we associate things whether we’re supposed to or not.

So why does the news media continue to do this, when they know it’s not factual? Because it’s much simpler and attention getting to say “Swine Flu” than H1N1. In fact, CNN itself has reported on the financial harm pig farmers are facing due to this mislabeling. And yet, in their story today, entitled “Confirmed cases of H1N1 virus approach 900,” the lead sentence states, “The World Health Organization cautioned that the swine flu outbreak could gain momentum…” They just can’t resist the need to use the very inaccurate phrase they reported on.

Bottom line? Words shape thoughts. Thoughts shape actions. Now, more than ever, it’s important to choose our words wisely.

Electrasol® Gets Rinsed Away… new name is Finish®

April 28, 2009

It’s tough to give up a legacy product name, no matter how goofy or unrelated it sounds. I saw a TV ad this weekend announcing that Electrasol, the tried and trusted name in dishwasher detergents, is now Finish®. Come to find out, Finish was already the name for the product everywhere outside the U.S. and the company wanted to simply “clean up” their branding hierarchy and have all the dishwashing related products under one unified name. According to their web site, “FINISH® products are the same ELECTRASOL® and JET-DRY® products that you know and trust, now backed by the power of the world’s #1 dishwashing brand.”

I could find no trace of where the original name Electrasol® came from (two partners Electra and Sol? Spanish for “electric” and “sun?”) Regardless, the new name Finish® is much simpler and has an implied promise (to “finish” the job, or to put a “finish” on the dishes.) Some will lament the change just because consumers get attached to the way things are, but overall this is a good move. Fractured branding becomes a nusance at some point, both in terms of time, attention, packaging and promotion.

(Now if the parent company, Reckitt Benckiser, would take it one step further and simplify their own name.)

The pitfalls of using a family name for your business name

April 14, 2009

I took a call from Jason Del Rey a few weeks back about an interesting branding story he was working for Inc. Magazine, for which he needed an expert opinion. Skinner Baking Company had long supplied regional grocery store chains with an unbranded pastry for their bakeries. Now the owner wanted to “brand” the product by putting the family name on the label. This would be a smart move if…

1. Their current customers didn’t care (it seems that the non branded pastries give the appearance of being made fresh on site… something the stores would lose with a branded label)

2. They went to their customers with a proactive marketing campaign, talking about how the publicity around the new brand name would drive more business (otherwise what’s in it for the stores?)

3. They chose a meaningful brand name and message.

In this case, there was little to no research into the idea, even with existing customers. The desire was to create a legacy brand using the owner’s name Skinner (again unresearched and untested.) It’s not to say it won’t work, but there needs to be more thought when it comes to branding than just putting your family moniker on your products. For instance…

• Does this fit with your overall business model/strategy? (In this case, the company had made a name for itself in the industry as a supplier… now it was also going to try and be a consumer brand. Would that disrupt their current business with other customers?)

• Are legacy/family names the best ones for branding purposes? Is there any inherent value in the name Skinner if it’s never been advertised or promoted? Could there be a better name that highlights some aspect of the brand? (i.e. Wonder Bread, Nature’s Pride, etc.)

• Will the brand message be supported with marketing and advertising dollars? Or is it assumed that shelf exposure will do the trick?

Many successful products have legacy/family names, but that is generally due to their longevity in the marketplace. In other words, they have gradually become known over a long expanse of time. The family name didn’t do the trick, it was the quality of the product or service. Otherwise we could all slap our names on companies and they would do well. What we don’t hear about are the thousands of companies that use family names and go nowhere… because a surname by itself is meaningless (in much the same way as acronym names are meaningless… i.e. ZQW Group and JXU Consulting.)

So unless your last name is Trump or Rockefeller (again, names that have acquired meaning over time) it might be wise to brand your company with something more meaningful, something that will give you a head start with your brand messaging, something that will provide a powerful marketing platform. Amazon provided a strong metaphor for a company that supplies a deep and diverse range of products. It’s unlikely that The Jeff Bezos Company would have been a better name. Outback Steakhouse is much more engaging, memorable and inviting than Ruth’s Chris Steakhouse.

The moral of the story? When starting a new business, sometimes the best thing to do with the family name is to simply keep it in the family.

Online branding for small businesses

April 6, 2009

Newsday.com did a nice feature piece on the in and outs of online branding for small businesses. Tungsten was featured as one of the expert sources for the story. For our part, we emphasized the need for brand consistency, both in the look and feel of a web site, as well as having the exact matching .com domain name. Too often small business owners cut corners on the internet portion of their businesses, yet will spend thousands in leasehold improvements on rented space. The virtual component of any small business needs to be taken as seriously as its bricks-and-mortar counterpart.

A number of retail clients have told me that their online store does as much, or more, than one of their physical locations. Yet they often don’t get the same monetary support. For some consulting firms, the internet can play a huge role in obtaining new business, comprising the majority of their revenue stream.

The moral of the story? Treat your web presence with the same loving, tender care that you would give your storefront or trade show booth. Branding is about the experience, so make it a good one.

The Best (And Worst) Company Names of All Time

January 5, 2009

Inc.com today announced their list of the top ten best and worst company names of all time, based on feedback of top naming experts nationwide. Tungsten Branding’s recommendations comprised two of the top ten names (Amazon and JetBlue) as well as three of the ten worst names (Books-A-Million, Ruth’s Chris Steak House, CompUSA.) Naming is always a subjective art, so read over the list and weigh in with your thoughts and opinions. Poor company names are not just the ones that sound bad, they are the ones that confuse potential customers, box in a company, and limit its growth and opportunities. A special thanks to Inc. magazine Senior Reporter Ryan McCarthy for this insightful showcase of naming do’s and don’ts. For even more insight, read our post “Is Your Company Identity Killing You?”