When picking a name for your business, a lot of the work has to do with what you want to tell the world about the brand. Agilent Technologies toiled for the first four months of its life as “Newco.” The word Agilent (agile-nt) was finally chosen to signify speed, focus, accountability, and agility (the -nt at the end just adds more weight to the word). The word "lego" is a combination of the Danish words "leg godt," which means "to play well." In Latin, lego means "I study," or "I put together." The best product names are short, catchy, positive, easy to remember and clearly communicate what the product is about. Since most startups have limited funds, a new product needs to virtually sell itself.
When choosing a logo, aim for an image that conveys clear meaning at a glance. The UPS logo, created by Paul Rand in 1961, is a good example. The logo is economical and succinct, simple yet distinctive, businesslike yet warm. It communicates the company's essential mission without needing a tag line to explain it -- a package with a bow, just enough detail to be jaunty but spare enough to be timeless. The name of the company is reinforced because it's integrated into the logo, and the classic shape -- a shield -- makes it look official. The emblem signifies trustworthiness and inspires customer confidence. And the colors brown and gold, not the standard blue and green that are usually found on corporate logos, make the company memorable to consumers. The overall effect is that people get the message without being barraged with excess information. Although the shipping business has changed considerably since Rand created that design almost 50 years ago, the UPS logo remains timeless and effective.
The name of your company should be the vessel through which all your marketing flows. It’s the one thing your competitors can’t take away from you. Your marketing has to send the message that you’re relevant: it has to give people reasons to buy. For example, the marketing and advertising for the new VW Beetle presents a reason to buy if you’re one of the select few who have an optimistic personality and you don’t take yourself too seriously. Your personality matches the personality of the car. This is your car. Your decision is not about price, it’s about what this product means to you, how it fits into your life. Now that’s a reason to buy.
Branding is everything on the Internet, where all but the largest branded websites find it increasingly difficult to attract visitors. Branding tactics that work in the real world don’t always work online because companies aren’t allowed to say or market anything online unless the customer wants to hear it. The fact that the customer is in charge is the central theme differentiating television from Internet marketing. On the Internet, the advertiser must “pay” the consumer to endure the brand message by performing some kind of service in return. At startup, Saturn’s site offered the usual dealer referrals and car specs. But it also provided a lease-price calculator, an interactive design shop for choosing options, and an online order form. As a result, in its early years, 80% of Saturn’s customer leads came via the Internet.
It pays to develop high visibility. Promotion is about getting your message out without spending a lot of money in the process. Think creatively and have a sales message on all your communication. That way, you get publicity without paying extra for it. If you can’t be #1 in a category, create a new category where you can be because no one remembers #2. And the customers’ perception is the only reality.
Tuesday, December 9, 2008
Monday, December 8, 2008
Startup advice from John Major.
John Major is the Founder and President of MTSG, an investment and strategic consulting partnership. Previously, he was the CEO of Novatel Wireless, Inc., a San Diego based provider of wireless broadband access solutions for the worldwide mobile communications market, where he led the company's successful IPO.
- Remember, a great idea often sounds dumb initially to smart people.
- Get the goals explicit and clear. When you don’t know where you’re going, all roads lead there and this slows you down.
- Keep the message simple. Remember the line from the movie Jerry McGuire; “You had me from hello!”
- Have operations review meetings once a week. Ask, “How can we all work together to make the success we want happen?”
- Get people used to asking themselves, “How do I have to change my behavior to make others more successful?”
- When people aren’t successful, they know it. So, help these people out the door and make sure to thank them for their contributions. In a small industry, you’ll probably end up working with them again, so don’t burn your bridges.
- People can be categorized along the following continuum:
Some are dumb - Some are smart
Some are high energy - Some are low energy
Make sure the dumb, high energy people are working for someone else, preferably for your competitors.
- Impose limits on your growth. Too many opportunities can kill you as easily as too few.
- Don’t look to maximize sales; look to maximize profits.
- Many growing companies fail because they don’t really understand their economic model. When they don’t stay aligned with their market, they don’t have enough money.
- Remember, a great idea often sounds dumb initially to smart people.
- Get the goals explicit and clear. When you don’t know where you’re going, all roads lead there and this slows you down.
- Keep the message simple. Remember the line from the movie Jerry McGuire; “You had me from hello!”
- Have operations review meetings once a week. Ask, “How can we all work together to make the success we want happen?”
- Get people used to asking themselves, “How do I have to change my behavior to make others more successful?”
- When people aren’t successful, they know it. So, help these people out the door and make sure to thank them for their contributions. In a small industry, you’ll probably end up working with them again, so don’t burn your bridges.
- People can be categorized along the following continuum:
Some are dumb - Some are smart
Some are high energy - Some are low energy
Make sure the dumb, high energy people are working for someone else, preferably for your competitors.
- Impose limits on your growth. Too many opportunities can kill you as easily as too few.
- Don’t look to maximize sales; look to maximize profits.
- Many growing companies fail because they don’t really understand their economic model. When they don’t stay aligned with their market, they don’t have enough money.
Friday, December 5, 2008
Suburban, a poem by John Ciardi.
John Ciardi was born at home in Boston's Little Italy in 1916. After the death of his father in 1919, he was raised by his Italian mother (who was illiterate in both English and Italian) and his three older sisters, all of whom scrimped and saved until they had enough money to send him to college, first to Bates College and then Tufts University where he graduated in 1938. The next year he took an M.A. and the prestigious Hopwood Award in poetry at the University of Michigan. He taught at Harvard and Rutgers, although he considered teaching to be "planned poverty." A longtime resident of Metuchen, New Jersey, he died on Easter Sunday, 1986, of a heart attack, but not before composing his own epitaph:
Here, time concurring (and it does);
Lies Ciardi. If no kingdom come,
A kingdom was. Such as it was
This one beside it is a slum.
Ciardi served as a highly popular poetry editor of the Saturday Review from 1956 to 1972. His occasional public television broadcasts were supplemented by his weekly National Public Radio series begun in 1980 as "A Word in Your Ear." Here's a typical example of his work:
Suburban by John Ciardi.
Yesterday Mrs. Friar phoned."Mr. Ciardi,
how do you do?" she said. "I am sorry to say
this isn't exactly a social call. The fact is
your dog has just deposited-forgive me-
a large repulsive object in my petunias."
I thought to ask, "Have you checked the rectal grooving
for a positive I.D.?" My dog, as it happened,
was in Vermont with my son, who had gone fishing-
if that's what one does with a girl, two cases of beer,
and a borrowed camper. I guessed I'd get no trout.
But why lose out on organic gold for a wise crack
"Yes, Mrs. Friar," l said, "I understand."
"Most kind of you," she said. "Not at all," I said.
I went with a spade. She pointed, looking away.
"I always have loved dogs," she said, "but really!"
I scooped it up and bowed. "The animal of it.
I hope this hasn't upset you, Mrs. Friar."
"Not really," she said, "but really!" I bore the turd
across the line to my own petunias
and buried it till the glorious resurrection
when even these suburbs shall give up their dead.
Here, time concurring (and it does);
Lies Ciardi. If no kingdom come,
A kingdom was. Such as it was
This one beside it is a slum.
Ciardi served as a highly popular poetry editor of the Saturday Review from 1956 to 1972. His occasional public television broadcasts were supplemented by his weekly National Public Radio series begun in 1980 as "A Word in Your Ear." Here's a typical example of his work:
Suburban by John Ciardi.
Yesterday Mrs. Friar phoned."Mr. Ciardi,
how do you do?" she said. "I am sorry to say
this isn't exactly a social call. The fact is
your dog has just deposited-forgive me-
a large repulsive object in my petunias."
I thought to ask, "Have you checked the rectal grooving
for a positive I.D.?" My dog, as it happened,
was in Vermont with my son, who had gone fishing-
if that's what one does with a girl, two cases of beer,
and a borrowed camper. I guessed I'd get no trout.
But why lose out on organic gold for a wise crack
"Yes, Mrs. Friar," l said, "I understand."
"Most kind of you," she said. "Not at all," I said.
I went with a spade. She pointed, looking away.
"I always have loved dogs," she said, "but really!"
I scooped it up and bowed. "The animal of it.
I hope this hasn't upset you, Mrs. Friar."
"Not really," she said, "but really!" I bore the turd
across the line to my own petunias
and buried it till the glorious resurrection
when even these suburbs shall give up their dead.
Thursday, December 4, 2008
Four pillars of brand building.
The first question that an emerging business needs to ask is: "What makes our brand stand apart?" Examples of muddy car brand identities; how can you tell the difference between GM’s Oldsmobile and Buick? Ford has struggled for years with the question: "What’s a Mercury?" According to a recent study, Coca-Cola and Disney still maintain their differentiation, while Greyhound and Kodak do not. The winners have been adept at innovating what their products are about, identifying and attaching new attributes to their image.
To make your brand look multidimensional and your competitors look uni-dimensional, you need to know what it takes to be successful in your market space and the key product attributes that differentiate you from others. Once you know that, tell that story over and over again. Change the rules of the game over and over again. Act like the leader, but don’t try to do what larger companies do with less money or you’ll risk looking like a cheap also-ran.
The second pillar of building brand equity is establishing brand relevance. Customers are always subconsciously asking, "Does this brand speak to me?" This is the so-called personal appropriateness of the brand. People can be extremely aware of what a brand stands for without being personally interested in making the brand a part of their life. Think of Ferrari and Victoria's Secret as examples.
The third pillar is brand esteem, which is a measure of how highly consumers regard the brand. This is closely related to perceived feelings of popularity or highly perceived quality. Global brands with the highest esteem ratings due to their perceived quality include Hallmark and Lexus.
The fourth pillar, brand knowledge, is the consumer's understanding of the brand's inner workings. High brand knowledge suggests acute customer intimacy or proof that consumers are experienced with how your product or service works for them – for better and for worse. This is the culmination of any branding effort.
BankDirect, initially a creation of New Zealand’s ASB Bank, wanted to be first in the market with a “no branch” virtual bank concept (branchless banking using call centers and Internet technology) and so reap first mover advantage. Initial research had identified a key target consumer group who knew what direct banking was all about and would likely be early adopters. They were busy people who valued their time and had high account balances. They were computer confident and likely to meet the minimum computer system requirements. They knew that a branchless bank should have lower fees and mortgage rates and higher deposit rates (the cost of an Internet transaction is a few cents versus over a dollar for the average transaction cost with a bank teller).
So BankDirect was designed for these consumers, and not for business clients. BankDirect’s name was a key element in branding the new product because the company didn’t have to explain what the business did. Since its target customers understood the concept of a branchless bank, advertising didn’t have to spell out all its advantages. As a direct marketing operation, a high percentage of the budget was allocated to advertising, which was designed to appeal to the early adopters and make the phones ring. After six months in operation, BankDirect had enough of a database to begin to see trends (for example, most of their customers didn’t come from ASB but from outside the bank).
To make your brand look multidimensional and your competitors look uni-dimensional, you need to know what it takes to be successful in your market space and the key product attributes that differentiate you from others. Once you know that, tell that story over and over again. Change the rules of the game over and over again. Act like the leader, but don’t try to do what larger companies do with less money or you’ll risk looking like a cheap also-ran.
The second pillar of building brand equity is establishing brand relevance. Customers are always subconsciously asking, "Does this brand speak to me?" This is the so-called personal appropriateness of the brand. People can be extremely aware of what a brand stands for without being personally interested in making the brand a part of their life. Think of Ferrari and Victoria's Secret as examples.
The third pillar is brand esteem, which is a measure of how highly consumers regard the brand. This is closely related to perceived feelings of popularity or highly perceived quality. Global brands with the highest esteem ratings due to their perceived quality include Hallmark and Lexus.
The fourth pillar, brand knowledge, is the consumer's understanding of the brand's inner workings. High brand knowledge suggests acute customer intimacy or proof that consumers are experienced with how your product or service works for them – for better and for worse. This is the culmination of any branding effort.
BankDirect, initially a creation of New Zealand’s ASB Bank, wanted to be first in the market with a “no branch” virtual bank concept (branchless banking using call centers and Internet technology) and so reap first mover advantage. Initial research had identified a key target consumer group who knew what direct banking was all about and would likely be early adopters. They were busy people who valued their time and had high account balances. They were computer confident and likely to meet the minimum computer system requirements. They knew that a branchless bank should have lower fees and mortgage rates and higher deposit rates (the cost of an Internet transaction is a few cents versus over a dollar for the average transaction cost with a bank teller).
So BankDirect was designed for these consumers, and not for business clients. BankDirect’s name was a key element in branding the new product because the company didn’t have to explain what the business did. Since its target customers understood the concept of a branchless bank, advertising didn’t have to spell out all its advantages. As a direct marketing operation, a high percentage of the budget was allocated to advertising, which was designed to appeal to the early adopters and make the phones ring. After six months in operation, BankDirect had enough of a database to begin to see trends (for example, most of their customers didn’t come from ASB but from outside the bank).
Wednesday, December 3, 2008
Developing the brand.
To develop a brand, you must have a marketing strategy. Once you have that, spend as much money as you can on establishing your brand. Give products away to get great customers to use them early on and build momentum. Build the biggest, boldest branding campaign you can and take all the new business you can get. Power through the hiccups and play catch-up with all the other elements of the business. Grow as fast as the market allows you. Have a gigantic vision - don’t wait until you’ve done it all to make bold claims or it’ll be too late. Branding establishes your identity depending on how loudly you scream about it. Make the claim and pay it back. Work to get your brand and reputation to exceed who you are because your brand has an enormous impact on your valuation.
The most successful businesses are those that tie their product to a single concept in the customer's mind, such as Volvo and safety; Federal Express and overnight delivery. The more specific the focus, the more everybody in the company can have that focus too. Brand recognition can help raise the barriers to entry for smaller, more obscure rivals that might compete on technology or on marketing, but can’t compete on both. Technologies frequently change, but a great brand goes on and on. A product or service can be copied or imitated, but a brand cannot.
When you develop a brand program, don’t forget your employees are a primary audience. They must understand what the brand promises so they can translate and interpret it. Branding serves both to focus people’s strategic thinking and to shape customer’s perceptions of the business’s unique value proposition. Successful brand marketing is effective even when the consumer isn’t thinking of buying your product. It plants a seed in the mind of a consumer not yet in the market. In businesses where products or services become obsolete quickly, a strong brand is one of the few things customers and employees have to hold on to, but a brand means little unless it’s accompanied by quality, consistency and flawless execution.
McDonald’s core brand attributes are being reliable, fast, wholesome, American and family-minded. If Mercedes made hamburgers or computers, it wouldn’t get much advantage from putting its logo on them. Consumers are smart enough to know what the boundaries of brands are, so new offerings must be complimentary to the company’s existing core products. Many successful new products are really extensions of existing products. The core attributes of the Coke brand are permanence (“Always Coca-Cola”), authenticity (“The Real Thing”), and feeling good. The Coca-Cola company conducts regular consumer surveys to determine how the beverage scores on more than a dozen value attributes which have included “young,” “modern,” “warm,” and “friendly.” More people buy Coke than any other cola and, most importantly, they enjoy the experience of buying and drinking Coca Cola. The fond memories of childhood and refreshment that people have when they drink Coke are often more important than a little bit better cola taste. It’s this emotional relationship with brands that make them so powerful.
The most successful businesses are those that tie their product to a single concept in the customer's mind, such as Volvo and safety; Federal Express and overnight delivery. The more specific the focus, the more everybody in the company can have that focus too. Brand recognition can help raise the barriers to entry for smaller, more obscure rivals that might compete on technology or on marketing, but can’t compete on both. Technologies frequently change, but a great brand goes on and on. A product or service can be copied or imitated, but a brand cannot.
When you develop a brand program, don’t forget your employees are a primary audience. They must understand what the brand promises so they can translate and interpret it. Branding serves both to focus people’s strategic thinking and to shape customer’s perceptions of the business’s unique value proposition. Successful brand marketing is effective even when the consumer isn’t thinking of buying your product. It plants a seed in the mind of a consumer not yet in the market. In businesses where products or services become obsolete quickly, a strong brand is one of the few things customers and employees have to hold on to, but a brand means little unless it’s accompanied by quality, consistency and flawless execution.
McDonald’s core brand attributes are being reliable, fast, wholesome, American and family-minded. If Mercedes made hamburgers or computers, it wouldn’t get much advantage from putting its logo on them. Consumers are smart enough to know what the boundaries of brands are, so new offerings must be complimentary to the company’s existing core products. Many successful new products are really extensions of existing products. The core attributes of the Coke brand are permanence (“Always Coca-Cola”), authenticity (“The Real Thing”), and feeling good. The Coca-Cola company conducts regular consumer surveys to determine how the beverage scores on more than a dozen value attributes which have included “young,” “modern,” “warm,” and “friendly.” More people buy Coke than any other cola and, most importantly, they enjoy the experience of buying and drinking Coca Cola. The fond memories of childhood and refreshment that people have when they drink Coke are often more important than a little bit better cola taste. It’s this emotional relationship with brands that make them so powerful.
Tuesday, December 2, 2008
Branding the product.
The idea of branding initially developed in medieval Europe. Plagues were a major ordeal at the time and people became ill from drinking brews infested with germs and vermin. The German purity law of 1516 was a very successful attempt to change that. As a result, beer brands sprang up to tell drinkers which of the available lagers were brewed in accordance with the regulations. From then on, brands were used to confer quality on products and consumers were prepared to pay more if they were assured of higher quality.
A brand isn't just a famous name. A brand is a set of differentiating promises that link a product or a service to its customers. Research shows that prospective buyers of business printers, for example, consider and compare the brand leader’s products and those of only one other company before making a purchase. If a corporate brand isn't on this short list, it generally won’t be purchased. Without a strong corporate brand to separate it from others, even superior new products will be overlooked by the majority of buyers. Brand equity is that aspect of corporate reputation (such as reassurance of product quality and trusted service) that leads an individual to buy a company’s products or services. Brand preference increases directly as awareness increases. Advertising builds brand equity and hence leverages the company’s marketing ability.
One of the first jobs of any branding endeavor is to break through the communications clutter and get products into the buyer’s consideration set. Sell your brand to multiple audiences but be sure to change the message for each different audience. Nowadays, brands are increasingly becoming icons of a particular life style and attitude. So, brand positioning must include attitude and personality - it’s an image, it’s a flavor. Your positioning is very, very important - it’s the spot you own in the business universe. What’s your positioning? What’s your differentiation? An example could be, “We make your Web site faster and we guarantee it.”
In consumer markets, brands are everything, They reassure bewildered consumers and help lift a company’s products out of the commodity marketplace so they can command both loyalty and premium prices. A brand is an emotional shortcut between the company and its customers. In some ways, you could say that a brand is a type of packaging, wrapping itself around the product, guaranteeing a certain quality and consistency. It creates a gravitational pull to your company. Intel spent billions of dollars on marketing, almost half as much as it spent on R&D. As a result, its branding of “Intel inside” became a “trustmark,” (that is, a trademark that consumers regularly put their trust in). That became as much a part of its dominance as its technical leadership.
Branding helps new companies survive long enough to secure a market foothold for their products and services. It helps them retain a loyal following and boosts their credibility when they announce plans to enter a new market or launch a new technology. As technology becomes more complex, it enables customers to short-circuit often baffling buying decisions. Remember the slogan, “No one ever got fired for buying IBM.”
A brand isn't just a famous name. A brand is a set of differentiating promises that link a product or a service to its customers. Research shows that prospective buyers of business printers, for example, consider and compare the brand leader’s products and those of only one other company before making a purchase. If a corporate brand isn't on this short list, it generally won’t be purchased. Without a strong corporate brand to separate it from others, even superior new products will be overlooked by the majority of buyers. Brand equity is that aspect of corporate reputation (such as reassurance of product quality and trusted service) that leads an individual to buy a company’s products or services. Brand preference increases directly as awareness increases. Advertising builds brand equity and hence leverages the company’s marketing ability.
One of the first jobs of any branding endeavor is to break through the communications clutter and get products into the buyer’s consideration set. Sell your brand to multiple audiences but be sure to change the message for each different audience. Nowadays, brands are increasingly becoming icons of a particular life style and attitude. So, brand positioning must include attitude and personality - it’s an image, it’s a flavor. Your positioning is very, very important - it’s the spot you own in the business universe. What’s your positioning? What’s your differentiation? An example could be, “We make your Web site faster and we guarantee it.”
In consumer markets, brands are everything, They reassure bewildered consumers and help lift a company’s products out of the commodity marketplace so they can command both loyalty and premium prices. A brand is an emotional shortcut between the company and its customers. In some ways, you could say that a brand is a type of packaging, wrapping itself around the product, guaranteeing a certain quality and consistency. It creates a gravitational pull to your company. Intel spent billions of dollars on marketing, almost half as much as it spent on R&D. As a result, its branding of “Intel inside” became a “trustmark,” (that is, a trademark that consumers regularly put their trust in). That became as much a part of its dominance as its technical leadership.
Branding helps new companies survive long enough to secure a market foothold for their products and services. It helps them retain a loyal following and boosts their credibility when they announce plans to enter a new market or launch a new technology. As technology becomes more complex, it enables customers to short-circuit often baffling buying decisions. Remember the slogan, “No one ever got fired for buying IBM.”
Monday, December 1, 2008
Neil Senturia’s commandments.
Neil Senturia’s commandments for new ventures.
- Understand your customer’s pain and find a way to alleviate it.
- “If we can get just X% of this market” isn’t a very compelling story.
- Investors have short memories.
- “No” is a way station on the road to “Yes.”
- You have to have a working product, not just a good idea.
- Timing is more important than anything.
- You can’t go fast enough.
- Be aggressive but don’t take unnecessary chances.
- The golden rule is that the guy with the gold rules. Never, ever run out of money.
- Return all phone calls. Attend all meetings. Everything matters.
- Don’t be limited by reality.
- When you’re small, get big people to help you. Team up with strong partners.
- Answer all threats. Improve your position and pose a counter threat.
- Play for the initiative. If you have it, maintain it.
- Cut your losses but lose as little as possible.
- When you dance with the devil, dance quickly.
- Rely on your own powers. If you can’t see the power of your opponent’s move, there probably isn’t any.
- Out-hustle the other guy.
- Try to develop with threats, but don’t threaten pointlessly.
- When you can’t decide, accept.
- Choose a plan and stay with it.
- To gain time, you usually have to sacrifice.
- Remember Einstein - time slows down as speed increases.
- Build your company around great technology and great people.
- Don’t let brilliant, talented people leave.
- If you’re going broke, keep it to yourself.
- Either be really well liked or don’t be liked at all.
- Being on the edge of success is half an inch from disaster.
Senturia was a founder and CEO of Atcom/Info, mohomine, Soflinx, and currently heads up Blackbird Ventures with his wife and fellow investor, Barbara Bry.
- Understand your customer’s pain and find a way to alleviate it.
- “If we can get just X% of this market” isn’t a very compelling story.
- Investors have short memories.
- “No” is a way station on the road to “Yes.”
- You have to have a working product, not just a good idea.
- Timing is more important than anything.
- You can’t go fast enough.
- Be aggressive but don’t take unnecessary chances.
- The golden rule is that the guy with the gold rules. Never, ever run out of money.
- Return all phone calls. Attend all meetings. Everything matters.
- Don’t be limited by reality.
- When you’re small, get big people to help you. Team up with strong partners.
- Answer all threats. Improve your position and pose a counter threat.
- Play for the initiative. If you have it, maintain it.
- Cut your losses but lose as little as possible.
- When you dance with the devil, dance quickly.
- Rely on your own powers. If you can’t see the power of your opponent’s move, there probably isn’t any.
- Out-hustle the other guy.
- Try to develop with threats, but don’t threaten pointlessly.
- When you can’t decide, accept.
- Choose a plan and stay with it.
- To gain time, you usually have to sacrifice.
- Remember Einstein - time slows down as speed increases.
- Build your company around great technology and great people.
- Don’t let brilliant, talented people leave.
- If you’re going broke, keep it to yourself.
- Either be really well liked or don’t be liked at all.
- Being on the edge of success is half an inch from disaster.
Senturia was a founder and CEO of Atcom/Info, mohomine, Soflinx, and currently heads up Blackbird Ventures with his wife and fellow investor, Barbara Bry.
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