Earlier in the week, in Honesty in Blog Product Reviews, we talked about the proposed amendments that the FTC is considering which brought into question blogger product reviews. Let’s consider just how great that influence is on consumers’ purchasing decisions.

As blogging became more mainstream and credible, the concept of web log suddenly morphed into more of a blog-like magazine. The tone stayed the same in most cases, but the content got more serious, more useful and more frequent. What began as one consumer simply sharing a random product experience with other consumers quickly ballooned into established and trusted bloggers being sought out by advertisers to frequently provide reviews on their blog.

A recent workwithoutboss.com post noted an Opinion Research Corp. stat that, “84% of Americans say online reviews influence their purchasing decision.” Also noting that Rubicon Consulting found that, “online reviews are more influential and come just only next to word-of-mouth publicity.”

Interestingly, 10% of respondents said articles published in a magazine/newspaper influence strongly while 20% are influenced strongly by online reviews (and 35% for word-of-mouth). Somehow, the medium of online reviews is more trustworthy despite its lack of federal regulation? Or maybe the tone is simply more conversational, more real? With magazines dying left and right and magalogues (magazine-catalogue hybrids like Shopper’s Drug Mart’s Glow) living on, consumers are even less confident that the products on those pages are there because they’re the best and not because they’ve been placed by advertisers who’ve paid in one way or another.

Pending FTC regulations could change the landscape a bit; however, the personal, one-on-one feeling you get when reading a blog will ring true despite having to disclose any relationships with advertisers. In fact, it might just strengthen the trust between blogger and reader.

The focus will lie more heavily on forums and comments as a means of generating conversation around a brand. Careful management of these venues and vigilent response time will be key factors in managing your brand. Damage control isn’t what it used to be. It’s not about eliminating unfavourable reviews, it’s about responding to them.

Image: Stock Exchange

The quick but healthy lunch destination Lettuce Eatery recently rebranded as Freshii.

They needed to be consistent with their offering, and by expanding to provide snacks, wraps and soups, a name change is in order. Proprietary research at Name Development shows that “more than 300 companies in the US change their name over the course of a year because they have outgrown it.”

NameWire.com, Name Development’s blog, reported on the reason to rebrand. “The name change is mainly due to Matthew Corrin, who originally wanted to be the “Starbucks of Salads,” but slowly widened his positioning to offer healthy meals and snacks. In short, he outgrew his name.”

But some are wondering if the new name was a good choice. The Torontoist interviewed Freshii’s CEO, Matthew Corrin who admitted that, “it might not be the greatest name in the world, and it doesn’t really mean anything,”  but he went on to affirm that, “it connotates freshness and fun. A name doesn’t really mean anything until you attach the brand to it.”

I guess Corrin believes his branding is firmly established. But can you really just transplant a brand promise from one name to another and expect the brand promise to shine through? After all, as NameWire pointed out, “Starbucks offers far more than just coffee and Burger King offers more than just burgers.” Lettuce Eatery at least had a very loyal following while Freshii risks not attracting new rabbits lunch goers.

Marketing Mag’s coverage showed the up side of the rebrand. They wrote that Corrin said that in Chicago, he “discovered that under the new name, stores sold more high-profit menu items like oatmeal, soup and frozen yogurt.”

There are many questions to ponder here:

1. Should Lettuce have abandoned the Lettuce name?
2. Was freshii a smart alternative?
3. Does the established brand promise of Lettuce carry over to freshii?
4. Is the freshii choice worth raising suspicion about riding the coat tails of the Fresh brand?
5. What would you have renamed Lettuce Eatery?

Note: read the entire Torontoish article for more about a supposed filing of an objection to the name with the Canadian Intellectual Property Office for being too similar to Fresh, another healthy eatery in Toronto and supposed menu plagiarism.

Often when faced with the task of purchasing a high-end product, many consumers jump online to find out what’s available. Brands, models, features and price points are all considered and compared, culled from company and store websites around the web.

In my case, after a thorough spreadsheet is created with the various product specs, I often still don’t have a decision made. That’s when I start searching through online reviews of the top 3. Now that particular behavior is just me - I’m sure most buyers don’t build a thorough spreadsheet and some might possibly even go straight to the reviews.

Ah the power of peer reviews. Where there are no loyalties to any one brand in particular, where anything goes, where it feels like you’re just chatting with a friendly neighbor. Or not?

Recently, the FTC published a set of proposed rules that would pull the bloggers who write commercial endorsements under its jurisdiction. This has the potential to completely change the landscape of online reviews.

As BNET Advertising reported, it all began when, “the FTC began its review of endorsements in 2007. The agency is concerned that when, for instance, celebs appear in weight-loss ads claiming they lost 50 pounds, that consumers might believe these results were typical even though on-screen small print displays a disclaimer.” Since then, the FTC has moved towards blogs and bloggers, inviting debate on proposed amendments.

Now, from the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising:

the potential liability of advertisers who use bloggers to promote their products and of the bloggers themselves.

and

the general principle material connections between the endorser and the advertiser should be disclosed to several new forms of marketing – blogs, discussion boards, and “street teams.” The Commission specifically seeks comment on these examples, with particular focus on the expectations held by consumers as to the relationships that exist between advertisers and endorsers in these new marketing contexts.

For companies, that means placing your brand in the hands of potentially fabulous brand carriers will suddenly become much harder. Pay per posts will be particularly impacted. The example that the FTC uses concerns skin care products (emphasis mine):

A skin care products advertiser participates in a blog advertising service. The service matches up advertisers with bloggers who will promote the advertiser’s products on their personal blogs. The advertiser requests that a blogger try a new body lotion and write a review of the product on her blog. Although the advertiser does not make any specific claims about the lotion’s ability to cure skin conditions and the blogger does not ask the advertiser whether there is substantiation for the claim, in her  review the blogger writes that the lotion cures eczema and recommends the product to her blog readers who suffer from this condition. The advertiser is subject to liability for false or unsubstantiated statements made through the blogger’s endorsement. The blogger also is subject to liability for representations made in the course of her endorsement. The blogger is also liable if she fails to disclose clearly and conspicuously that she is being paid for her services.

Their suggestions for preventing unsubstantiated statements is for the advertiser to provide guidance and training to the blogger and to carefully monitor their posts to halt any untrue claims. Now, how does that make regular consumers want to engage in the dialogue on a blog when they can read between the lines that the advertiser is pulling the strings? Sure, it is important for bloggers to disclose any gains they’ve received in writing a product review; however, such close monitoring of such posts could lead to the deterioration of blog-like articles on the web.

Another example speaks more closely to this situation:

A college student who has earned a reputation as a video game expert maintains a personal weblog or “blog” where he posts entries about his gaming experiences. Readers of his blog frequently seek his opinions about video game hardware and software. As it has done in the past, the manufacturer of a newly released video game system sends the student a free copy of the system and asks him to write about it on his blog. He tests the new gaming system and writes a favorable review. The readers of his blog are unlikely to expect that he has received the video game system free of charge in exchange for his review of the product, and given the value of the video game system, this fact would likely materially affect the credibility they attach to his endorsement. Accordingly, the blogger should clearly and conspicuously disclose that he received the gaming system free of charge.

So what does this mean for your brand? Well, for one, the relationships you forge with bloggers do need to be clean and honest. Requesting the that blogger disclose what he or she got in exchange for writing a review is important. Your customers will ultimately respect that you’re associated with this honesty. Moreover, an unfavourable review is not necessarily a bad thing. As we’ve talked about in a previous post about listening to your customers, catching those reviews enables you to make improvements, to respond directly in a forum that accepts your contribution, and to re-engage alienated customers with your brand, potentially regaining their loyalty.

Image: Stock Exchange

by guest blogger Ehren Cheung

5 Reasons Why Branding and Experience are the Same

This is the second installment of a two-part article. Read Branding and Experience, Part 1.

4. Culture and Expectations

When people take public transit – what do they want? Do they expect better service or do they expect crowds? Public transit users all have the expectation that it is crowded, so the TTC improves upon that image by increasing the number of buses per route. How do these customers treat one another? How do people use your service or product? Do all of these small elements combine to create a good experience? It’s an equation of negatives and positives / pros and cons.

Photo courtesy of Robert Ewart

A prime example would be when we walk into a store and try to avoid that annoying sales representative, or when we are looking for something and a customer service rep patiently waits for us to figure out what we want. Perhaps we’re trying to check out a product and a bunch of people are standing in the way chatting. These are all facets of a much bigger and broader picture. Understanding that there are always points of contact that your organization does not have control over, where can you begin to improve your customer’s experience? This could be air conditioning, cleaner buses, greater environmental friendliness.

The TTC has attempted to address security issues by placing closed-circuit cameras all over the place and has helpfully increased the awareness of the next bus or subway station by introducing automated announcements. Of course some elements that have been introduced had been forced by the Human Rights Commission. The funny thing is that announcements don’t only help the visually-impaired because commuters find them helpful as they no longer need to keep looking out the train window to determine what station it is. Prior to the automated announcements, no one was sure if their stop was coming up — especially if it were crowded and the bus driver wasn’t being particularly articulate in his or her announcements.

Improvements such as the above help address issues not necessarily directly related to getting from point A to B, yet when put together — provides a fundamental part of the greater experience.

5. Perception and Design

A number of years ago — the TTC had some horribly designed ads. That wasn’t the most horrible by far. It always looked like someone “designed” something in Microsoft Word and sent it to the printer. That said, some of their ads are still horribly designed. I think someone finally had the right idea and brought in a designer to provide a more consistent and professional appearance to the presentation of TTC brochures and posters. We don’t need to go over why design is so important. It ties into the customer experience and the exchange of value. Just think of products you purchase these days, how vital its design really is, and how it influences your perception of value.

So what now?

These five separate but intertwined elements illustrate that branding isn’t really branding and marketing isn’t really marketing. The outcome out of all of these “marketing” initiatives is a multi-layered and faceted, multi-directional channel of communication that influences all aspects of the individual’s sensory, emotions, and memory-association. This is one’s experience. The TTC may have introduced subway trains with greater space, but the irony is commuters associate the greater train space with smaller seat space.

Labour strikes are just as tied into the TTC’s image as the crowds of riders who use the city’s transit services. The TTC can post as many public service announcements as they want about the great work that the TTC and its workers perform, but just like the typical branding and advertisement — there is little for any individual to correlate with their experience. There is no context. We know on a basic level that good people run the TTC but that does not mean poor service levels are acceptable. It is only when individuals experience service levels that meet or exceed their expectations that perception begins to change, as do expectations, culture, and ultimately the overall message that is shared.

Looking at the public transit as an example of customer experience is fascinating because it forces us to acknowledge that there are forces beyond our control. Sometimes it is government policy while other times it is the metropolitan culture. For any product, it can be a similar set of external or internal forces; but the customer is almost always a constant within the equation. Provided that a business has an effective product and does not offend large masses of people; focusing on improving the experience of the customer — which amusingly, is the element that any business organization has the most influence over — will lead to the much sought after branding.

Ehren is an avid web worker. Currently working as the internet fundraising coordinator for the Heart and Stroke Foundation (formerly an online marketing specialist for the book industry), he spends his nights tinkering with online media. One can find his musings at www.onelittlecog.com and share in his joy of road trips at just.gettingsidetracked.com.

by guest blogger Ehren Cheung

5 Reasons Why Branding and Experience are the Same

One of the first things we must understand when we talk about branding, is that branding and customer experience are essentially the same. We’re trained to step back and dissect the two apart; it’s actually quite easy – we do it all the time when we analyze our marketing strategies. The funny thing is that if we were to take a step forward – and look closely at how we respond or rather how customers respond to products, we realize that branding, marketing, and all that other mumble jumble is essentially the same as customer experience.

The greater challenge for businesses and organizations is to stop ourselves from overusing marketing terms or concepts and take that step forward to look at all these elements in a holistic and more humane perspective – the customer experience.

Photo courtesy of Robert Ewart

Think of your local public or mass transit system. What is your gut feeling? I’m going to use the Toronto Transit system as an example, what comes to mind when you think of the TTC? What is your first reaction?

1. It’s all about points of contact

Every time that your organization is in contact with the customer is also the time that you are effectively (or ineffectively) branding yourself. Whether this may be waiting for a subway train, stepping on to a bus or phoning in to ask a question in another language – this is all part of the customer experience. It’s important to identify how your customer interacts with you to really understand how they feel about you. Now we begin to realize that some points of contact aren’t even really “points” at all for you; but they are for the customer.

2. Customer Experience is everything. Just like branding.

Just to name a few: Buses either come in threes or none at all; Subways are crowded; TTC offers help in many languages for a cosmopolitan city like Toronto. We identify the brand based on our individual experiences with it. Newcomers may start off with a fresh point of view however those who are familiar with the logo, the bus system, transfering from one transit line to another – all regard the brand from their own experience, regardless of how much money the government keeps saying it’ll put into public transit.

3. Is your message conveying a point or a rationale?

Without diving into too much history, the TTC often uses the phrase “Ride the Rocket”. Alas, anyone who has travelled on the TTC would likely think otherwise. Not that the TTC isn’t effective at playing its role as the mass transit provider for the population of Toronto – it just happens to set itself up to be the joke of the city when mechanical failures and poor traffic flow continue to frustrate riders. Sure we could simply point fingers at all the different factors including politics and urban sprawl but there are always external factors to any business – that doesn’t mean you are exempt from a customer experience standpoint.

A more positive message that the TTC uses is “The Better Way”. Of course how much better is determined by the customer.

“I’m not suggesting the death of advertising; nor am I suggesting that companies avoid mission/vision statements or logos or color palettes. However, I am suggesting that all of those things are secondary. The primary job of any brand executive is to create an outstanding customer experience.” — Mark Hurst, Good Experience Columns

Tomorrow, we will continue with the rest of this two-part article, finishing up with Culture and Expectations, Perception and Design and Final Thoughts.

Ehren is an avid web worker. Currently working as the internet fundraising coordinator for the Heart and Stroke Foundation (formerly an online marketing specialist for the book industry), he spends his nights tinkering with online media. One can find his musings at www.onelittlecog.com and share in his joy of road trips at just.gettingsidetracked.com.

A recent article written by Allen Adamson for Forbes.com illustrates the differences between Facebook and Twitter in managing your brand.

While he doesn’t prophesies about which will exceed the other in popularity, he does believe that, “Twitter and Facebook can both play a role in a branding strategy. Having said this, I also think that just as users think about Twitter and Facebook differently, so too should companies as they go about their branding efforts.”

The key to both tools, he explains, is that they enable companies to listen to their audiences, the importance of which we’ve talked about on Brand Curve.He takes this a step further by talking about the quality of what you listen to. To establish a brand promise that can genuinely meet consumer needs and expectations, the quality of the insights you listen to need to be very high.

Monitoring opinions is very important, and the fact is, that with the tools are their disposal, customers are going to spread word quickly whether you’re apart of it or not. Monitoring these conversations, as Adamson says, can help you fix a sticky situation before it gets too out of hand, and it can also enhance the experiences making them more relevant and valuable.

When it comes to differentiating the two tools, Adamson calls Twitter an “early warning system” - letting “marketers know instantly what’s going on as it happens,” he says, and giving them the “opportunity for rapid response.” He also attributes to Twitter the power to “get people to self assemble and become impromptu, impassioned marketing machines.”

Facebook on the other hand is about a deeper dive into details. He calls it a “forum in which to engage consumers in a more significant way, to share more and to get them to share more of themselves in the process.” This is an obvious difference given the capabilities of Facebook’s platform to be more engaging and deeper in it’s contact points.

“Facebook, the Petrie dish for word-of-mouth that it is,” he writes, “is a fantastically efficient tool for creating brand advocacy.”

So, as Jeremy Bullmore in this year’s Brandz commentary wrote, it’s now all about empowering your consumers with the tools they need to create your brand .

The trends identified in this year’s Millwood Brown Optimor Brandz Top 100 are VALUE, VICE, AT HOME and WIRELESS.

Value is not surprising given this economy. Though luxury brands have a great opportunity for creativity, it’s the value brands that have an easy job at capturing customers, getting that repeat business and securing their brand names. “Brands that represent good value for money have done well, this is about quality as much as price, for example Wal-Mart (+19 percent), ALDI (+49 percent) and Auchan (+48 percent). H&M (+8 percent) is now the number one apparel brand.”

The vice brands are fun to watch from the outside but I really wonder if the Malboro execs sit around the boardroom table calling themselves vice brands! According to the study, “people still reward themselves with little treats when money is tight. Brands such as McDonald’s (+34 percent), Marlboro (+33 percent) and Budweiser (+23 percent) have all done well.”

After 9-11, the home decor and renovation sectors went nuts. Suddenly, travel wasn’t the hottest holiday trend but instead, creating a warm, safe and luxurious home was top priority. Perhaps now the risk is less forefront, but certainly in tough times we tend to stay close to home. “Brands that can be experienced at home have shown strong growth. This includes home shopping: Amazon (+85 percent) and eBay (+16 percent); Coffee that can be prepared at home: Nespresso (+27 percent) and Nescafe (+23 percent); and gaming — Nintendo jumped into the ranking for the first time at no. 32.”

Wireless is definitely a trend I can speak to. Even my dial-up parents have moved into the wireless age in their home. No longer a luxury service, professionals and recreational wireless users alike demand better coverage from service providers and greater technology from their devices. “The increased popularity of using the internet on the move through devices such as the iPhone and BlackBerry has led to huge increases for the mobile operators category as a whole, driven by demand for data services. Vodafone enters the top 10 for the first time this year (+45 percent).”

What do you think of these trends? How do any of them relate to your own habits?

Early in the year, Trendwatching released a report detailing how companies should proceed in certain areas. In terms of luxury brands, the suggestion was to step outside the box. Others predict a glum forecast but remain focused on providing a truly luxurious product to a select few.

BrandZ Top 100 report was recently published and assured that “even the luxury category has gained in brand value by 10 percent, affirming the deep and enduring claim that well-crafted items and brand heritage have on our imaginations and wallets.”

It’s almost an affirmation of the success of established luxury brands that have had years to solidify their place in the market. Yet it doesn’t suggest that the luxury brands who aren’t necessary heavy hitters perhaps need to shake things up to remain successful in the long term. Especially with emerging brands that hope to take a slice of the pie, these companies really need to consider how they will do so.

Trendwatching’s What’s going to click in 2009? article wrote that, “in 2009, you define what constitutes luxury,” (emphasis mine) it “will be whatever you want it to be.” The report points to the hospitality industry for an example:

Rough Luxe is a new London hotel with small, funky rooms, some of which share a bathroom, while also offering fine wines, plush bedlinen, carefully curated art, and top-notch personal service. From their site: “Rough Luxe is a new way of looking at luxury as part of time and not only part of an object of consumption. The Rough Luxe definition of luxury is: time for reflection, personal encounters with people, nature, architecture and environment as well as food and social and cultural experiences linked to geographic locations.”

Whatever your catch-phrase, tagline or trend coining, trendwatching reminds that “whatever angle you may go for, luxury in 2009 will comprise much, much more than ostentatiously flaunting wealth (which, by the way, will still enjoy considerable popularity among emerging middle classes around the world).” Their call to action is an exciting suggestion to “find the right (status) trigger for the right audience, then coin it and build on it.”

Knowledge@Wharton sees things a little differently after the recent Wharton Marketing Conference. “What’s now “in” for marketing luxury in this difficult era is pampering the wealthiest and most loyal customers with everything from monogrammed shirts to personal in-home visits” they said. Instead of revolutionizing the approach, they’re opting for aggressively pursuing those who can still afford luxuries and not reaching too far down the economic ladder. It’s a matter of potentially tarnishing your brand to slash prices in order to salvage those relationships. Instead, it’s all about customer service for those wealthiest few.

Panelist Cori Galpern, worldwide marketing and advertising director for Tom Ford International, speaks to this saying,  “I think what we’ll see because of the economic crisis is that you lose a certain amount of that aspiration customer. Somebody who will buy a couple pairs of shoes over the course of the year is making other choices. The core for a luxury brand is a customer with very considerable wealth.”

The article noted an interesting figure from Randy Kabat, executive vice president of marketing and advertising for Prada USA that “roughly 50% of the firm’s sales come from just 5% of its customers.” The question then becomes who will remain the wealthiest.

Ruth Mortimer of the Brand & Business Blog wrote about The Luxury Institute’s yearly report reminding us that “everything is cyclical and this is a time when those brands with the potential to last in the long term need to invest more than ever.” The Institute’s suggestions for luxury brands are to:

• infiltrate the web,
• return to value-added luxury,
• salvage reputation through philanthropy,
• genuinely embrace corporate accountability,
• find brand carriers to act as trusted advisers of selective indulgences,
• and finally, make trust, authentication, validation and certification important issues for any luxury brand.

Interesting how different yet the same these two perspectives can be compared to Trendwatching’s suggestion of redefining luxury.

Millward Brown Optimor released the 2009 BrandZ Top 100 and Brand Curve recently posted the highlights from the findings.

Jeremy Bullmore, author of Behind the Scenes in Advertising, columnist of ‘Dear Jeremy’, chairman of J. Walter Thompson Co. and subsequently of WPP Group, and Director of the Guardian, provided an introductory commentary for the BrandZ 2009 report. 

Bullmore argues against the notion that brands were invented by manipulative marketeers to pursuade consumers into purchasing high-priced but otherwise “unremarkable” commidities.

He claims that we’ve been building brands since 1955 when Sidney Levy and Burleigh Gardner’s The Product and the Brand was published by the Harvard Business Review. But that “brands had been around for a very long time before the Harvard Business Review brought them to our attention.”

He asks us to think back to our school days to understand the relationship between brands and individual perception of those brands:

“When you first started thinking of that school down the road from your own – the one that always beat you at games – you invented your first brand. It had a name – and it had a very clear personality. You couldn’t say exactly why you hated it – but you did. And what’s more, so did your friends. But if you’d asked the boys and girls from the school down the road what they thought of their school, you’d have got a very different answer. How puzzling. Exactly the same school, yet two totally different reputations.”

He explains that the observer creates the reputation of the brand - it can only exist in their minds and as each observer is different, so too are the reputations. And so, there would be a million slightly different versions of a brand’s reputation. He writes that, “Gardner and Levy drew our attention to the fact that the personality of a product, as created in the head of each observer, could be as important to its users as its function.” And so, the marketers must create and supply what Bullmore calls the raw material that real people can take to subjectively compose the brand image.

This is exactly what the Millward Brown researcher take into consideration. Strong brands enjoy what they call a favourable consensus of subjectivity. He concludes that the brand managers, “didn’t build those brands themselves; but they fed such enticing titbits to their audience that their audience gratefully did the rest.”

Time to feed the masses what they’re craving!

This week, Millward Brown released the 2009 BrandZ Top 100, the world’s largest brand equity study. “Millward Brown Optimor created the BrandZ Top 100, a ranking that identifies the world’s most valuable brands measured by their dollar value.”

The value of the top 100 brands has seen a marginal increase of 1.7 percent. Given the economic climate, this is a big deal! BrandZ reports that “when every key financial indicator plummeted, the value of the top 100 brands increased by 2 percent to $2 trillion.” In the BrandZ press release, Joanna Seddon, CEO of Millward Brown Optimor said that, “In the current environment, where the value of many businesses has fallen, brand has become even more important because it can help to sustain companies in tough times. Those who continue to invest in their brand will be better positioned for business growth as the economic situation starts to improve than those who have cut spend.”

In the list, 85 brands remain from 2008. The top of the 15 brands entering the ranking are Pampers, Nintendo and VISA, all entering quite high on the list. The 15 that dropped off the list were from categories particularly hard-hit by the economic situation: cars, financial institutions, and insurance.

Check out who made the cut:

See anything surprising? Can you guess the 15 brands that dropped from the list?

Of the list, some are just hanging around, riding out previous momentum, while others are pushing forward, hitting the top 10 list of highest brand momentum and the top 20 risers list.