Building a strong brand Presented to: Presented by: Klein & Partners DATE
Branding provides the guidelines for your organization on HOW to behave, WHAT to say and do, and HOW to achieve your goals. It is ‘how’ you sell the ‘what.’ How we think about‘brand management’
Connecting the dots… on quality ‘How’ we position the ‘what.’ Commitment = Strong Brand Branding Stronger Loyalty Experience How consumers see it How we see it Clinical Weaker Loyalty Meaningful & Expected Meaningful & Differentiating
Health reform how it will impact branding The ‘Old’ Model The ‘New’ Model Doctors Hospital-centric; transactional; volume Medical Home Home care Hospice Patients Hospitals Population; relational; value Health insurance Urgent Care Outpatient Home Care Nursing homes Outpatient Health & Wellness Insurer Specialists Healthy Folks Not much interaction
Picking dance partners M&A is going crazy! Fragmented Oligopolistic Monopolistic Hospitals & Systems Utilities Banking Big Box Retail Home Improvement America West buys US Airways US Airways US Airways buys American American United buys Continental United Delta ‘merges’ with Northwest Delta Airlines
It provides the guidelines for your organization on HOW to behave and HOW to achieve your goals. It provides the rules to the game! Blue 32, Red 42, Right Split, Hut...Hut! What is a brand strategy and why do I care?
What is brand equity? “Brand equity is a set of assets (and liabilities) linked to a brand's name and symbol that adds to (or subtracts from) the value provided by a product or service to a firm and/or that firm's customers.” -- David Aaker, Building Strong Brands “A product is something that is made in a factory; a brand is something that is bought by a customer. A product can be copied by a competitor; a brand is unique. A product can be quickly outdated; a successful brand is timeless.” -- S. King, WPP Group, London “A company’s brand has almost nothing to do with its products or services anymore. Branding is really a function of the dialogue between a company and its constituents. The more meaningful that dialogue, the stronger the brand.” --Larry Weber, head of Advanced Marketing Services for Interpublic and author of The Provocateur “...It is that dialogue between the organization and the consumer that either enhances or erodes the value of the brand over time.” --Rob Klein, Klein & Partners
Rewards of brand equity • Provides value to the • organization by enhancing… • Efficiency and effectiveness of marketing programs • Brand commitment • Prices/margins • Stock performance • Brand extensions • Trade leverage • Competitive advantage • Buys time when the company makes mistakes • Provides value to customers by enhancing… • Interpretation/processing of information (i.e., shortening the decision-making process) • Confidence in the decision • Satisfaction with the experience Brand Equity
1. The brand excels at delivering the benefits customers truly desire. 2. The brand stays relevant. 3. The pricing strategy is based on consumers’ perceptions of value. 4. The brand is properly positioned. 5. The brand is consistent. 6. The brand portfolio and hierarchy make sense. 7. The brand makes use of and coordinates a full repertoire of marketing activities to build equity. 8. The brand’s managers understand what the brand means to consumers. 9. The brand is given proper support, and that support is sustained over the long run. 10. The company monitors sources of brand equity. Top ten traits of strong brands* *According to Harvard Business Review, Jan/Feb 2000
What makes a strong brand? Strong BrandWeak Brand Coke Pepsi (It has been estimated that more than 50% of the worth of Coca Cola Company is in its trademark.) McDonalds Burger King Intel AMD (Market capitalization has increased from $10 billion to $150 billion since 1991. Intel measures brand equity as the price discount needed to get a customer to accept a PC without an Intel microprocessor.) Hertz Avis Wal-Mart Sears/K-Mart Home Depot and/or Lowe’s HQ, Builder’s Square? What are their tag lines and what do they tell us about their brand positions and target audiences?
Brand management is… • “Brand management is a business strategy, NOT • just a marketing or communications strategy.” • --Rob Klein, Klein & Partners • A successful brand strategy requires a long-term commitment on the part of senior management as well as the entire organization. • A brand strategy impacts: • hiring and training practices • corporate culture • accountability • staffing • product development • delivery • pricing • marketing • advertising and promotion • and ultimately, your position in the market
Definition of a strong brand As two sides of a single coin, we define a strong brand as having “the ability to acquire and retain customers more efficiently and profitably than competitors over the long-term.” These two elements of a single strategy are brought to life through… …an effectively communicated brand promise (i.e., customer acquisition) …the effective internal operationalization of the brand promise through a strong brand experience (i.e., customer retention)
1. Cost-based approaches 2. Market-based approaches 3. Income-based approaches 4. Formulary approaches, for example: Interbrand (and Financial World) Aaker’s “Brand Equity Ten” -Leadership -Price premium -Stability -Satisfaction/Loyalty -Market -Perceived quality -Internationality -Leadership/Popularity -Trend -Perceived value -Support -Brand personality -Protection -Organizational associations -Brand awareness -Market share -Market price and distribution coverage Ways to measure brand equity To financiers, brand equity = retained earnings.To marketers, brand equity = retained customers.
How Klein & Partners measures brand equity Brand Strength Brand Equity Source: Klein & Partners’ Brand Equity Model
Market Strength (aka: Market Barriers) • For example… Patients are often very location sensitive. This can often be a major barrier to use. • Location...Location...Location (as Ray Kroc always said) • While hospitals spend money trying to build their brand so that people will be attracted to using them, location of the hospital (or its convenience) remains a dominant factor in choosing a hospital. • It is a factor that can work for your hospital or one that work against your hospital i.e., a double-edged sword. Market Strength Source: Klein & Partners’ Brand Equity Model
A strong brand creates interest in itself for initial and repeat use and it also has to make sure it is “available” for those who want to use it. That is why strong brands pay attention to the Push/Pull aspects of their brand strategy: Pull (aka, Brand Strength): A strong brand creates interest in itself through its marketing and communication and experience efforts that make people want to use it (again). Essentially, with this strategy, consumers “pull” the brand through the distribution channel with their interest. Push (aka, Market Strength): Consumer interest can be undermined if the service is not readily available (i.e., there is some Market Barrier) or some other hurdle gets in the way of interest and actual behavior. For example, without a strong physician relationship, physicians can undermine a brand that consumers are interested in; not being in key insurer networks can cause people to go elsewhere; and having locations inconvenient to people can cause them to go elsewhere. When developing a brand strategy, both Push/Pull elements must be coordinated. Addressing just one is like a body builder exercising only one arm... How Brand and Market Strength Interact: Push/Pull (or Yin/Yang) Source: Klein & Partners’ Brand Equity Model
Elements of a brand promise Consumers How the brand promise is relevant to consumers: how the brand will benefit customers rationally and emotionally. A statement actively communicated to consumers that creates a unique and meaningful image and set of expectations in the consumer’s mind. Brand Promise Relevant How the brand is visually presented. Part of the brand identity. What human personality traits this brand exhibits. Part of the brand identity. Brand Visuals Brand Essence Brand Personality Differentiate Support How the brand is different from the competition. Why your brand promise is believable; ways the organization can support and live the promise. It is a “reason to believe.” 3-4 words that describe your brand’s heart and soul.
Brand essence examples • Brand Essence Examples • Nike: Authentic Athletic Performance • Hallmark: Caring Shared • Disney: Fun Family Entertainment • Post-Its: Fast Friendly Communication • Starbucks: Rewarding Everyday Moments ‘We are not in the coffee business serving people, we are in the people business serving coffee.’
Brand identity • Brand identity is a combination of visual, auditory, and other sensory components that create recognition, represent the brand promise, provide differentiation, create communications synergy, and are proprietary… • Names (also part of brand architecture) • Logos • Symbols and other graphic devices • Distinctive shapes and colors; visual cues; architectural forms • Brand voice and visual style • Sounds • Smells, Scents • Textures • Flavors • Jingles and other mnemonic devices • Typography • Theme lines or slogans • Brand characters • Personality • Create a brand identity standards guide that ALL brand family members (existing and new) must abide by. Can you think of examples in healthcare and outside healthcare?
e.g., brand identity ties organization/products together Service Line Advertising Service Line Advertising Service Line Advertising Disconnected messages lack tie-back to brand How you sell it Unifying Umbrella Brand Strategy What you sell Service Line Advertising Service Line Advertising Service Line Advertising A brand strategy unifies your service line messages – each service line message becomes a ‘chapter’ in a single book (i.e., same theme and tone across all the messages that tie them back to the brand).
Feel Learn Learn Feel Do Do Do Do Feel Learn Learn Feel Your brand dialogue is impacted by consumer behavior Feel Think …or Learn, Feel, Do Branding USP Cognition High Involvement The MIND Behavior Affect Involvement Low Sampling Positioning FCB Planning Grid
Seeking relevancy for your brand promise Less relevant Less defensible More relevant More defensible
The brand position game (remember the “King of the Hill” game?) Position occupied by competition Position is not occupied through either uncertainty or lack of perceived differentiation Your organization occupies the position Reposition Yourself and Competition Reposition Yourself Strengthen and Defend
Benefits of segmentation • Design responsive services to meet the needs of the marketplace • Determine effective and cost efficient promotional strategies • Evaluate the organization's market position and competitive stance • Provide insight on present marketing strategies
HealthyDiagnosedTreatmentLife Brand Promise Products Brand Relationship Consistent message Products and their messages can vary by customer life cycle as long as they connect with the brand promise. Customer relationship can vary but should have major consistent bonding orientation. (How you operationalize and execute the brand promise.) The customer life cycle and the brand strategy
Brand architecture – defining roles and rules • Brand Architecture refers to how you organize the different brands that comprise your organization. It provides for the roles each brand family member plays and the rules of engagement within and between brands so that every brand in the brand family is optimized in terms of what it brings to the table. • Two key things to remember about a brand family: • Managing a brand family is like managing a play… • Roles must be defined • Lines must be memorized • Each brand must stay within its defined parameters • Brands must be rewarded for playing their part well • Not all brands can be the lead • Which brand takes the lead can affect the entire outcome of the ‘play’ • Without brand family rules, related brands do not play well in the sandbox…
Managing your brand family (i.e., brand architecture) Where do we want to be on this continuum? Source: David Aaker, “Building Strong Brands”
Driver Brand (drives the purchase decision) Do people choose your organization for all their _______ needs and then the product/service that best suits their needs? Endorser [Supporting] Brand (supports or provides credibility to the driver brand’s claims) Do people choose a particular product/service for a preferred reason but are confident in their choice by the fact that it is provided by your organization? Strategic Brand (key to the future performance of the organization; heavy resources placed on this brand) What is your “Big Mac?” That is, do you have a key product that everyone connects with you? It is your most important connection with customers. Silver Bullet (the product/service that typifies what the organization stands for) Often a logo or mascot in sports, does your organization have that one silver bullet that stands for your core brand essence? (e.g., your Ronald McDonald? …your swoosh?) Defining brand roles Source: David Aaker, “Building Strong Brands”
There are essentially three product lines that can be considered “strategic brands” for the hospital. They are the “3-Cs.” Cancer Cardiac Children Each of these product lines has a “halo” effect on the rest of the hospital. Not only do they enhance the overall reputation of the brand but they afford it “geographic reach.” That is, hospitals with a strong reputation in cancer, for example, not only are well-thought of for other medical situations in their own market but in other markets as well. Hospitals without a leadership position in one of these areas tend to be considered “community” hospitals with little geographic reach. Strategic product lines
Brand hierarchy – system examples Branded House Strong Endorsement Endorser Brands Driver Brand Driver Brands Endorser Brand Hospital A Health System Hospital A Health System Hospital B Hospital B Consumers Consumers Service Service Med Group Med Group Co-Drivers House of Brands Driver Brands Dual Brands Driver Brand Health System Hospital A System - Hospital Hospital B Consumers Health System Service Consumers Service Med Group Med Group Link or no link – system could be an ‘internal’ system or play no active role
System structures System of Equals Hub and Spoke System Feeder Hospital Hospital A Health Plan Ancillary Services Hospital B HealthPlan Mother Ship Ancillary Services Physician Group Physician Group Feeder Hospital Examples Henry Ford Health System IU Health Johns Hopkins Medicine Examples Advocate Healthcare Centura Health Affinity Health System
What’s in a name? • Plenty • A majority of consumers will pay more for a “known and trusted” brand name. • All the good names are taken (unless you use a brand name within your own brand family) • Made-up words are about all that is left. (Empty Vessels remain the most common new brand name. Empty vessels come with no brand image or baggage. But they must be filled quickly and appropriately.) • How a name sounds is more important than how it looks, or what it initially does not mean.
Naming structures This is the branded part of the name. Here the facility branding is the driver brand. This is the descriptive part of the name Big City Hospital A member of the Humongous Health System This is the brand architecture part. Here the master brand serves as an endorser brand. Humongous Big City Hospital In this example, the master brand becomes the driver brand and the facility name is subordinate.
Understanding experience (i.e., operationalizing the brand platform) The three states of EXPERIENCE: Where BRAND fits in: 1. Expectations before the experience 1. Brand promise (expectations) 2. The actual experience 2. Brand experience 3. Brand memory over time 3. Experience + Promise • Expectations can be set from indirect experience with the brand, previous direct experience with the brand, word-of-mouth, marketing and communication from the brand, or from any other form of communication or interaction. • The actual brand experience is impacted by those expectations the customer brings with them to the encounter with the brand in relationship to how well the experience is delivered. • Memory of the actual experience is affected by how well the experience met positive expectations or countered negative expectations. The bigger the failure in the experience, the longer and more negative the memory halo effect will be (i.e., “memory telescoping” – making a memory better or worse than it really was). This memory can influence someone who is now in a position to influence another person’s expectations (as well as coloring their own for the next experience). And the cycle starts all over again… VS. Strong brands own their experience!
Bringing the brand to life Brand action plan
The brand management process Brand Action Plan Brand architecture Brand Team Brand identity standards and system Brand Platform -Essence -Promise -Personality -Target audience External and Internal Input Create Total Brand Experience ‘Everything matters’ Monitor Key Brand Metrics Brand Champion & Brand Team Operationalizing the Brand Platform -Processes -Points of contact -Brand senses -Customer stages ‘People want a relationship not a transaction.’ Organization’s core competencies and challenges, and strategic intent Market Barriers can negatively impact brand growth Marketing and Advertising supporting brand action plan Mkt/Adv ROI monitoring
Operationalizing the brand platform Points of Contact Hospital Outpatient Home care Unit Department etc… Life/Wellness Seeking Diagnosed Treatment Recovery Maintenance HR (staffing, hiring, training, skill building, accountability, engagement, coaching, buy-in) Corporate culture/DNA Facilities/Environment Location planning Services offered/development IT systems Clinical/non-clinical processes Safety standards/processes Experience management/ feedback Pricing Brand Platform -Essence -Promise -Personality -Target audience Customer Stages Processes • Over The Long-Term • Consistency (“A brand strategy is harder to maintain over time than it is to create.”) • Commitment from the top (CEO) • Resources/Investment (not viewed as a ‘cost’ or ‘cost center’) • Committed brand architecture plan (i.e., the brand family) • Brand responsibility/Leadership (CBO) • Tracking system Sight Sound Touch Smell Taste Brand Senses
Building the brand from the inside out… The key to ‘living’ a strong brand over time is creating internal brand champions of all staff. Internal communication Once you have a strong ‘story’ to tell then you can ramp up consumer demand (i.e., expectations). Adoption Phases: 1) Hear it 2) Believe it 3) Live it Investment External communication Time
Managing your brand over time • Over The Long-Term • Consistency (“A brand strategy is harder to maintain over time than it is to create.”) • Commitment from the top • Resources/Investment • Committed brand architecture plan (i.e., the brand family) • Brand responsibility/Leadership • Tracking system • Operationalization • Hiring and training practices • Staff accountability • Corporate culture • Products/Services • Customer service • Pricing • Distribution • Marketing/Advertising The evidence clearly shows that brand building is an investment rather than a cost, a necessity rather than a luxury, and a priority shared by the most successful corporations.
EVOLVING an Identity: gradually evolving a brand’s identity over time so that it eventually takes on an improved or even a completely new identity. AUGMENTING an Identity: retains the existing core identity but augments or extends it with additional identity elements. No brand can stand still; like a human, a brand must continually grow, learn, make mistakes, get sick, heal, etc. (and sometimes die) You have no choice about whether or not to be a brand. The only choice you have is to be a strong or a weak brand! Managing your brand over time
BRANDprint℠ How we build healthy brands
The goal of your brand management process should be to attain, retain, or regain a brand leadership position: creating a new brand repositioning an existing brand defending a brand leadership position repairing brand damage (i.e., baggage) …to be the King of the Hill! Building a healthy brand
Klein & Partners’ process... BRANDprintsm The entire brand management research process provides a blueprint for organizations to gain and maintain a healthy brand. Its four phases engage all key internal and external stakeholder groups in an information gathering and processing forum. Where are we now? • The first phase – Where are we now? – provides an understanding of the current competitive landscape along with your strengths and weaknesses, as well as opportunities and challenges. This phase helps set the realities or parameters for moving the brand forward. • The second phase – Where do we want to go? – focuses on determining what opportunities exist for (re)positioning the brand, defending the brand, and even repositioning the competition. • The third phase – How do we plan to get there? – serves to evaluate the brand position and its executional requirements to ensure that the strategy objectives are being met (i.e., the promise is on target and can be operationalized). • The fourth phase – Are we on track? – monitors your brand position over time to ensure that it remains on track with the target audience(s). Operational BRANDprintsm Strategic Where do we want to go? Monitor Are we on track? Tactical How do we plan to get there?