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Ingredient branding
Teflon, NutraSlim, Dolby Digital, Gore-tex, Lycra, Shimano, Woolmark and Intel… What do they have in common? Yep. They are all ingredient brands that made millions of dollars. Previously, we studied the brand hierarchy of Mervin Manufacturing and stated that MTX and BTX are actually ingredient brands. Today, we will look at the secrets of creating a successful ingredient brand.
Ingredient brands are extremely useful when there is little to no “perceived” differentiation among brands (the word “perceived” is key here.) Think about banana. Unless you are an expert, you cannot tell if the fruit is tasty by simply inspecting the outside of the banana. That’s when the Dole seal of approval becomes handy. Same logic applies to computers. Dell, IBM, HP laptops might look different, but when it comes to performance we don’t know how to rate them. That’s why the Intel Inside marketing program was widely successful. Likewise, consider you will buy a snowboard glove. You might like certain brands and design, but to be 100% sure about performance, you would look for the “Gore-tex” seal of approval.
There you have it, an ingredient brand gives you peace of mind when you are buying a product that has little perceived differentiation. So, leave everything you are doing and create an ingredient brand. Right? Nope. Ingredient brands are particularly useful if your brand is weak, undifferentiated or average quality in a fairly commoditized category. If your brand does not fall under this category, then be very careful, because ingredient brands are dangerous!
Ingredient brands need “partners.” Ideally the partnership should be an equal one, where both the ingredient and the host get enough equity. However, powerful ingredient brands are like cancer for host brands: they suck most of the equity (thus the Spiderman alien Symbiote analogy.) Think about Teflon. Let’s say you are going to buy a non-stick pan and you already have a favourite brand. But what if your preferred brand does not have Teflon, and other brands have it? Which pan would you buy? Who has the equity? Where does the loyalty lie? Who makes more money?
Consider ingredient branding as “outsourcing.” Business strategists say that “core competencies” should not be outsourced. By the same logic, you should not accept an ingredient brand takes away your core competency. If you are in bicycle business and use Shimano gears, how will you differentiate your bicycles? Gear is where the “performance” lies. If you use Shimano gears like your competitors do, how different can you be? Instead try to find an ingredient brand that “compliments” your brand. Service? Connectivity? Guarantee?
Today’s actionable tip: When considering an ingredient brand “offering added value outside of your core competency” should be your mantra.
Brand architecture 201: Mervin Manufacturing
Previously, we talked about different structures of brand architecture. Let’s continue from where we left off and look at brand hierarchy and roles by studying one of my favourite brands: Mervin Manufacturing.
Mervin is a designer and manufacturer of snowboarding and skateboarding products. What I love the most about Mervin is its culture, which is the brand’s core differentiator: Mervin is managed and staffed by snowboarders (It is literally written on my GNU Carbon Credit) who innovate and experiment, ride and refine new shapes, constructions, geometries. The brand is by far the most innovative player in the snowboard business. Mervin’s constant “build, ride, refine” philosophy (IDEO calls it “quick prototyping”) has created many important developments in snowboard evolution. That philosophy and the brand’s quirky personality are the reasons why its clientele is loyal to the brand as religious fanatics. (I am one of them.) Mervin owns many brands and manages them almost to perfection. Let’s see what I mean.
When we talk about brand hierarchy and roles, we usually refer to five levels:
- Corporate brand
- Master brand
- Sub brand
- Product
- Product descriptor
Corporate brand is often the parent company, which is usually not consumer facing. Mervin Manufacturing is a perfect example of a corporate brand. You cannot buy a Mervin board, binding or jacket. It is the holding entity (Actually Mervin is owned by Quicksilver, which is the higher corporate brand.)
It is the master brands that drive the customer relationship. They must have their own logos, personalities and values. Mervin owns five consumer brands: Lib Tech, GNU, Roxy, Freedom Dolly and Bent Metal. Every brand is unique. For instance GNU is “weird” in a cool way, whereas Lib Tech is more of a hardcore, performance-driven innovator.
Sub-brands are the differentiated brand promises within the master brand. In addition to five master brands, Mervin Manufacturing has two sub-brands: BTX (Banana Technologies) and MTX (Magne-traction). While MTX does not have its own look and feel (“Red flag” if Mervin is reading this!), BTX has its own logo. It even has variations. These are 2 great sub-brands that are shared by all Mervin boards. As a matter of fact, these sub-brands are also called ingredient brands, which we will discuss on the next article. (GNU also has the pickle technology, but I don’t think Lib Tech is using it.)
Next, we have product lines. GNU has the Carbon Credit Series, the Street Series, Pickles and more. Lib Tech has the famous Travis Rice series. The role of a product line is to identify a specific form within the master brand. Products don’t have their own look and feel. That said, they might have proprietary fonts, but not their own logos.
Finally, we have product descriptors, which distinguish the uniqueness of the product. Within the Carbon Credit series, there are “Wide” boards. The “Wide” is the product descriptor.
As you can see, Mervin Manufacturing manages its complex brand portfolio very well. As far as I can see, the main red flag is the absence of a logo for Magne-traction. MTX is a clear differentiator for Mervin boards, just like BTX is. Therefore, it’d better have its own logo. Speaking of MTX and BTX, on the next article we will look at the two sub-brands and talk about “ingredient branding.”
Brand architecture 101
Interbrand’s explanation of brand architecture is: “The way an organization structures and names the brands within its portfolio.” The firm adds that: “There are three main types of brand architecture system:
- Monolithic, where the corporate name is used on all products and services offered by the company;
- Endorsed, where all sub-brands are linked to the corporate brand by means of either a verbal or visual endorsement;
- Freestanding, where the corporate brand operates merely as a holding company, and each product or service is individually branded for its target market.”
Conducting online brand audit
Today, I’d like to show you step by step how to conduct a basic online brand audit. Since we are in the middle of the winter, and given that I live in Montreal, I chose “ski resorts in Eastern Townships” as my topic (Mont Sutton, Ski Bromont, Mont Orford and Owl’s Head.) I chose these ski resorts, because they are my favourites. I love them all. My goal is to show the best practices so that other brands can improve themselves. Mind you, this is an online audit; so I am not talking about the actual resorts. Similarly, I am not evaluating to their marketing collaterals either.
Keep in mind that online brand audit is quite a methodical task. You may want to print webpages and create a big collage. Or maybe you use Evernote. The key is to keep a record of everything because we are going to accumulate a lot of information. For every brand, we will check three fundamental things: the brand’s websites, its online footprint and its visuals. This will be fun. Let’s see what we find out!
2012 Trend Reports
2012 is around the corner! An exciting and challenging year awaits us. I compiled six great trend reports to help your brand navigate stormy waters in 2012. Enjoy the reports and let me know if you know other good ones.
Happy holidays to all!
2012 Global consumer trends by Euromonitor
2012 Consumer trends by Trendwatching
2012 Consumer trends by Trend-Strategy
2012 Retail trends by Retail is Detail
Brand Jordan
NBA lockout is about to end. The hot topic of discussion is what’s the damage to Brand Jordan?
Michael Jordan is arguably the greatest basketball player of all times. But his skills and will are not enough to explain how he became the magnetic person that he is. During his Hall of Fame induction speech, Michael Jordan said: “There won’t be a new Michael Jordan.” This is a false statement, because who we knew and adored as “Michael Jordan” was actually not an individual. The magnet was the “Warrior/Hero archetype.” Read the rest of this entry
2012 Colour Forecast by bvcolorstrategy
Jack Bredenfoerder, who is a seasoned color design and marketing professional issued his colour forecast for 2012. Mr. Bredenfoerder is specialized in color strategy, trends and forecasting. So his predictions are always bang on. Click the below picture, read his report and share it with your colleagues. It is full of insights, not only on colour strategy, but on socio-cultural trends.
Key to customer loyalty
There are some brands that I find so successful. I call them magnetic. One of those brands is Maui Jim, the sunglass company. The brand is best known for its high quality, reasonably priced and fashionable polarized sunglasses. I bought my first Maui Jim sunglass in 2008. Since then, I bought two more. As rational consumers, we often think we are loyal to a particular brand because it offers the best value for money, often quality being the key pillar of value. Well, quality is necessary, but not sufficient to create loyalty… According to Dr. Clotaire Rapaille, the key to loyalty is not quality. It is the quality of “relationship”.
Branding through Collaboration
Today, I’d like to share a wonderful presentation with you. The presenter’s name is Mrs. M.J. Braide. She is a renowned brand strategist from Toronto, Canada. I watched her webinar about a week ago. Then I said to myself: “Maybe I should make all my clients watch this video at the beginning of every new project.” It is full of insights, and actionable ideas. But most importantly, M.J. shows us the future of branding. A brand is not a logo and branding is not simply design. She talks about how the process of branding can be used to build bridges within an organization… Maybe even heal some wounds. Why don’t you watch the video and tell me what you think?
You and me: The Brand Relationship Theory
I love the TV series “the Office”. In one of the episodes Michael Scott has herpes and wants to know who gave him the disease. He starts working backwards through his partners, chronologically. Michael Scott being the person he is, instead of informing his past partners of his infection, he asks them relationship-related questions such as: “What went wrong? Did I make more of what we had than was really there?” What does Michael Scott have to do with branding? Everything, according to Dr. Susan Fournier’s brand relationship theory. Read the rest of this entry
