Month: April 2011

Every price point needs a story

By Mark Di Somma

The temptation is to see story as a luxury item: something that brands implement to lift their margin. There’s nothing wrong with that of course – it’s powerful and it works. But I don’t think that story is just a top-end nice-to-have. My view is that most brands, no matter where they are priced in the marketplace, need a storyline. To understand why, first let’s think about the alternative. Without a storyline, a product is just that. It has everything it needs (hopefully) to do what it’s being bought for but that also means it’s just another detergent, car oil, computer, whatever …That makes it highly vulnerable to house brands and to cheaper versions of what amounts to ‘the same thing’. It also means markets get packed very quickly with variants of the same idea that rapidly diminish the value equation: we talked about Groupon and its 425 competitors a couple of days ago. This problem of course only becomes more acute as you move down the value chain – meaning that at the very …

The Feynman principle

By Mark Di Somma

A review of a review about scientist Richard Feynman in the Freakonomics blog caught my eye this morning because it also provides a simple but telling thought for every brand owner. The author of the blog post, Sanjoy Mahajan, comments “It’s not quite true that Feynman could not accept an idea until he had torn it apart. Rather, the idea could not yet be part of his way of thinking and looking at the world. Before an idea could contribute to that worldview, Feynman wanted to turn over the idea, to see why it was true, from any angle that he could find.” We don’t have to look far to see what Feynman was fighting against. Once something has been widely accepted as fact, the temptation is to absorb it unquestioned and to work with it on that assumption. What Feynman did though was to say “you may very well think that, but before I can think that, before I can actually absorb any thought into my worldview, I need to prove it to myself”. …

Going, going, Groupon …

By Mark Di Somma

You know what you think you’re worth. But what are you really worth? Some great points about company du jour Groupon in this article originally posted on Forbes. Most interesting perhaps because the article helps explain why and how value can so rapidly commoditise. Here’s what I got out of it: Success quickly generates a wolf pack – 425 competitors and counting have simply copied Groupon’s model. They did so because they could. There doesn’t seem to be any specific IP here that prevents duplication. After the rain comes the flood. Lots and lots of competing sites in turn could well create “deal fatigue” – once customers have too much of a good thing, they quickly start to feel glutted, effectiveness drops and with it market share. Why get married? Big businesses can probably replicate this process themselves rather than go via Groupon – or as close as makes no difference to the consumer. Time for the big fish. Bigger opportunities attract bigger players. As you succeed, your competition also scales. In this case, Facebook …

Which north?

By Mark Di Somma

Yesterday St John asked whether north meant true north or magnetic north. Good question. As I said, most people have a sense of what the company they work for should be like. It’s natural for people to look for tangible ways to improve things. As we all know, it doesn’t take long for employees to offer a multi-point to-do list. Listen very carefully to what you are being told. But, at the same time, be careful how you treat this information. Chances are what you are hearing is, at some level, a variation on today. It is magnetic north – the reality they are naturally drawn to. Taken literally, it’s probably an improvement on the reality people are part of – rather than an indication of where you truly need to be heading in order to be competitive. As Henry Ford so rightly pointed out, if he had asked people what form of transport they wanted before he delivered them the automobile, they’d have asked for a faster horse. Don’t get me wrong, many of …

Travelling north

By Mark Di Somma

Keith Yamashita has a phrase I love. He talks about companies and brands finding their northern star. The term isn’t astronomical, it’s aspirational. He’s referring to an ideal of your company or brand that burns bright in front of you and your staff, that leads you on, that fires you up and that you never let out of your sight … It’s the brand and the culture you dream of being. It’s what your people long to be part of. And it’s who your customers always hoped you would be and that your competitors can’t be. It’s what a company’s vision should be all about. At Audacity, we call it your ambition. Without it, you drift. So many people can see that north star in some form. When I ask people in workshops about the company or the brand they dream of working for, they can tell me, sometimes in amazing detail, what it looks like, how it feels to be part of that , what it’s renowned for. They can see it. At times, …

Beautiful adventures

By Mark Di Somma

It seems even iconic hotelling isn’t safe from convergence. Flagship Parisian hotels are now finding themselves challenged by major Asian hotel groups keen to make their mark on the Continent. For the European establishment, it seems, the Far East just got a whole lot closer to home. The effect, according to Time, will be a 40% increase in the number of luxury rooms in the city, and a classic competitive tug-of-war between iconic Gallic chic and a lighter, more cosmopolitan stay that still emphasises luxury. Two particular ideas in this story really caught my eye – one as an idea, the other as a strategy. The first – the idea – was Philippe Leboeuf’s description of the new Mandarin as a “beautiful adventure”. What a fabulous term. Now that’s an idea I can see being applied far beyond the refined world of the Parisian avenues. A beautiful adventure, at least in my head, is both elegant and exciting, it has grace and adrenalin, aesthetic and wildness … It is an idea with the potential to …

Finding the long tail of distribution

By Mark Di Somma

This story about how United Villages is using motorcycles, mobile phones and face to face selling to bring big brands to the smallest villages in Jaipur in Rajasthan, India is a stark reminder that tapping tomorrow’s multi-billion dollar markets isn’t about the latest fave apps at the tech conferences. On the contrary, it’s about simple things like allowing retailers to keep trading by delivering the goods to them. It’s about local reps that the retailers get to know. It’s about something as straightforward as a product guarantee. This is the real long tail of distribution – a genuinely untapped maze of villages stretching across India, China, South Asia, Indonesia, the Pacific, in fact a good chunk of the earth. As the buzz from SXSW swirls online, it’s easy to forget isn’t it that massive numbers of the world’s future brand consumers are only now moving out of the analogue age.

A brand within a timeframe

By Mark Di Somma

It is perhaps the ultimate exit strategy – a company with a closing date. This article in the NY Times talks about NPOs such as Malaria No More and Out2Play that have decided their work is done. They’re closing because they have accomplished what they set out to do. Now imagine doing that with a brand. Setting a date by which you would have achieved set business and social goals along with an agreed return on capital – and ending it there. Too radical? My friend Sam Kebbell set up his architectural practice using that exact premise – a company that would last 50 years. And brand strategist Dan Herman has already successfully proposed just such an idea with his concept of “short-term brands”: brands that focus excitement and buyer loyalty because they are built not to last. Funny isn’t it how we all acknowledge the pace of change, and how much consumers crave the new, and yet we expect brands to just keep running. Perhaps that’s why they go stale. They need continuing infusions …

CEO discretion is advised

By Mark Di Somma

Further to the post of a couple of days ago. One of the great temptations of the online age is that you can gain attention. A lot of attention. Very quickly. Do something outrageous – in the case of GoDaddy CEO Bob Parsons, shoot an elephant and display the trophy video for all to see – and people will react. If you’re the CEO of a company, it must be tempting to think that a stunt like this is creating buzz, getting people talking, raising your brand’s profile. It’s all part of the job, right? All part of the controversy? All part of leading a challenging brand? Just a continuation of getting ads banned from Superbowl or whatever? The danger for colourful leaders is of course that at some point in the bid, they overstep the mark. Clearly someone forgot to tell the GoDaddy-in-chief that’s also what makes attention-seeking the ultimate brand honey-trap. Perhaps he doesn’t care, or notice? That may say something too of course. To some people, it may say quite a bit.