Wednesday, August 17, 2011

Brands without branding

A reader (hi, Steve) challenged me the other day.  He said that a marketer could move product successfully without direct/below-the-line marketing but that he or she couldn’t do so without brand advertising.  He gave as a case in point a marketer’s favorite: Apple Computer.  And he had a point.  Unfortunately, I think he made the wrong point.  (Hey, Steve, pick up the check next time and I won’t have to smack you down in my blog.)

Apple does, in fact, consistently put great TV spots on the air.  They do indeed have a remarkable brand.  In addition, one might describe their approach to direct marketing not as “old-school,” but rather as “pre-school.”  But what does Apple’s approach really prove?

I should start by acknowledging the obvious: Apple needs my advice on marketing about as much as they need my advice on alpaca-rearing or glass blowing.  A recent news article pointed out that they surpassed all the companies in the world in value, at least for a little while.  Their third-quarter revenue extrapolated out to a full year exceeds that of Cuba.  However, these successes help make the point.

In case you’ve forgotten, Apple has all but mastered TV advertising.  Remember this?

Or this?

Or this?

How about this?

OK, maybe I went a step too far there.  But I trust that you get the point.

Meanwhile, I can shed a little light on their direct marketing practices.  Another friend of mine worked at Apple for a while.  He had an email marketing background and wanted to bring some leading-edge thinking to email marketing at Apple.  At the time, Apple sent one-size-fits-all emails to their email list.  

My friend suggested segmenting by product owned, by products viewed on the site and by other commonly-used segmentation schema.  His bosses rejected the ideas because Apple emphasizes a consistent experience for all customers.  Segmented email would mean different experiences for everyone.  As a result, Apple continued one-size-fits-all emails, evidently with no harm to their bottom line.

How can I explain Apple’s success in the face of their flagrant disregard for what I think?  Simple.  It’s the product, dummy.Apple’s best advertising doesn’t take the form of a TV spot, a print ad, a website, a point-of-purchase display or a vanity postal address.  The product is the advertising.

Yes, other products offer a similar experience.  Yes, other products offer more capability at a lower price.  But at least since the original iMac of 1998, Apple has tended to get the details that matter most to consumers right most of the time.  Consumers--as a group--tend to enjoy using Apple products more than they do other products.

Could Apple have succeeded with the same products if they created boring or unremarkable advertising?  Would their stock price have soared as high?

Let me give you a counter-example.  Maybe you’ve heard of these guys:

Quick: name one great ad for Honda automobiles.

Maybe, just maybe, you know this one:

Good answer, but it ran in 2003.  In the UK.  Of course, it did become a viral sensation, but it advertised a car that the US arm of Honda did not sell.

Honda has never made memorable advertising.  Yet Honda sold over a million cars in 2010, more than any other single make except for Ford, Chevrolet or Toyota.  Not bad for a company with lousy ads.

Honda typically sells a lot of cars based on their intrinsic qualities--engineering, fuel economy, comfort and utility.  They even manage to make some sporty cars.  They routinely appear in both Car & Driver’s 10Best lists and Consumer Report’s recommended lists*.  Advertising doesn’t really enter into the picture.

Not every brand stands above its competition the way that Apple and Honda do.  In the consumer packaged goods category, for instance, brands have little in the way of product differentiation from one another.  For these brands, advertising provides differentiation.  These brands do, in fact, require great brand advertising.  Moreover, no brand suffers by having good advertising.  However, more brands could learn from Bose, which hardly ever uses brand advertising.

So, to finish the argument, no, marketers don’t need great direct marketing to sell.  But they sure don’t always need great ads, either.  So there, Steve.


*Ironically, Honda seems to have entered a down phase in product quality as of late.  I doubt this will seriously hurt the company, who have sold high-quality cars in the US for 40 years.  Besides, a company that survived the ‘94 Accord and the original Odyssey minivan can probably survive anything.

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