Growth for Mature Brands: War of Movement

According to Philip Kotler, there are two types of CEOs,  - those who know they don't understand marketing, and those who do not know they don't understand marketing. They specialize in other things - operational expertise, engineering, technical skills, sales. For a time we saw a few rising stars from marketing and customer support - these days you find less of them, especially in mature industries, especially in companies that need a new injection of growth.

That is a shame, because for an organization to grow beyond the incremental - which in fact can be decreasing profitability, if you look close enough - once it gets to a certain stage of growth, you really need someone who understands they need marketing. There are some serious business decisions that need to be made in terms of profitability of the product/service line, service delivery, etc. - I go with the 90/10/90 rule: put 90% of your efforts into the 10% of the activities that will give you 90% of the profit. It's an outside-in approach.

When it comes to the state of the brand and business metaphors around that, we are probably all familiar with the term positioning. This is the process by which marketers try to create an image or identity in the minds of their target market for its product, service, brand, or organization. It is the 'relative competitive comparison' their product occupies in a given market as perceived by the target market.

You have probably also noticed how pervasive the "war" metaphor is in business language - the people in the trenches, you kill the competition, or maybe you just drive them out of business - and the adulation of the lessons taught by Sun Tzu in The Art of War. It was in this ancient book that positioning in strategy was explained as being affected both by objective conditions in the physical environment and the subjective opinions of competitive actors in that environment.

Tzu wrote that strategy is not linear planning like a to-do list - it requires fast and appropriate responses to changing conditions. While planning works in a controlled environment, in a competitive environment competing plans tend to collide, creating unexpected situations.

War of position for brands can get quite expensive in the crowded marketplace in which we are today. Let's review what you do with war of position (thanks, Gerry). You:

• Conquer and own ground
• Own a position
• Reflect your strength in holding ground
• Bring customers to a place and evolve the place over time

The game here is about who owns what. Which is great if you have the ability to establish that position and remain unchallenged for it. It also requires a pretty large commitment in time and budgets if the business does not truly own that brand. How many new brands can say they own a position? How many mature brands can also say that? Fewer and fewer.

With a mature brand that is looking to reinvent its way to growth, in addition to the smart decisions the business needs to make, you may be able to change the game by waging a war of movement. Many younger brands are doing that successfully. What does war of movement mean? You:

• Own the movement, a direction
• Reflect flexibility and speed in holding the course
• Bring customers on a journey, a specific path moving forward

The game then becomes about who is going where. Companies who are immersed in these dynamics may also find that integrating new media and learning to become more social beyond customer care will serve them well.

Having worked in mature industries with mature brands, I also found that movement allows you to do several positive things that can help you grow the business. You:

• Focus more on creating and energizing
• Capitalize from collaboration with customers, partners, even competitors
• Promote your vision as a way to provide direction
• See more opportunities along the way
  
• Do your own thing and are not totally preoccupied with fighting someone else's battle

This can be fertile ground for innovation and open the door to conversation, if the company can let go of what made it big, profitable and known up until it got to flat status on the growth chart. Have you worked with mature brands? What have you found successful? Do you have an example of a mature brand that was re-energized?

[image from a site The History of Branding that is now defunct]

Comments

[Marc Meyer]

Great Post Valeria, 2 things come to mind- fat and happy has never meant more in corporate speak-we're seeing instances of it every day and by the time "we" see it, It's oftentimes too late. With that being said, the companies that are prescient, light on their feet, lean, remain hungry, maintain an even keel, possess some foresight, and are willing to take a risk from time to time are the ones that will come out ahead and ultimately survivr. Is that a tall order? I don't think so-it's all about culture and creating it.

[Len Kendall]

Great Post. We're seeing OLD brands market share getting cut into more and more with the new start ups that are essentially providing similar services online faster, cheaper, and easier. The mature brands that don't adopt own such a valuable entity (their logo) but they have to continue to evolve their offering as well. Just did a piece about Zagat vs. Yelp and how years experience means nothing when it comes to the current interation of a product.

[Valeria Maltoni]

@Marc - "it's all about culture" and it's not created from pressure and keeping people off balance. There needs to be a trust built upon ongoing, two-way dialogue.

@Len - there are many more options for any given business today. Even when not competing head to head for the same product or service, we are competing for how our customers choose to solve their problem. The logo is a symbol, a representation. It's what is behind it, the substance of your company story and dialogue in the marketplace, that makes a difference. Good example on Zagat vs. Yelp.

[Crystal Beasley]

I don't have observations so much as questions. How is the game changed if the mature brand is selling products versus services or information? It seems that the most vulnerable companies to being taken over by an emerging competitor are those like Zagat that are selling information. Established product companies have exponentially higher set costs and seem therefore, to innovate at a much slower pace.

Second question is how mature brands can leverage their top of mind awareness in a way that newcomers to the scene could not. Pentagram was able to slice and dice the Saks Fifth Avenue on their new identity to make something fresh and beautiful. http://www.underconsideration.com/brandnew/archives/skns_iafeth_vaefus_new_identit.php

If a new company did this, they would lose the very legibility of the brand. Obviously this example is about the literal logo, but could it be expanded to other aspects of the business model?

[Valeria Maltoni]

Crystal,

That is a very good question. I'll take a stab - it's about what kind of information you can sell credibly. I watched as Lexis Nexis failed to have a digital strategy for years, and yet it remained top of mind. Dun & Bradstreet, Doane's - these are all companies that are still in the game largely based upon their historical archives and data, track record and brand recognition. In my mind established consulting firms are in the same bucket. You buy a Deloitte report, a McKinsey report, etc.

Which brings me to the second point. How can you take the story you've got to a new place? Surely, the company has refreshed the way it does things, hired new talent, evolved from experience, etc. And it's not just about the logo, it is about how the communication of a different experience and the actual experience customers have. It should touch all business practices, from the way the service is conceived, to the way you answer the phone, to the way the execution takes place, etc.

[Tim Hayden]

Valeria,

Great post today - par for the course. ;-)

I'm seeing "game-change" as the "mature" brands having little to gain in conquering new ground along the same path they've traveled along until today. Rather, they each stand to change direction with all their might along collaborative trails to new opportunities that may deliver spoils similar to those enjoyed until now.

With that, I'm confident we will only see the "mature" herd weed itself down and out as each member makes wrong turns, misfires or simply cannot focus on the feasible, reasonable, logical direction they should head now.

[Nathan Ketsdever]

To me in the age of Wikinomics, the zero sum war of dominance seems outdated. It seems to me that Cluetrain is an update to the original Art of War for business. Openness is trust, success, and dominance.

That is after all how we brought down the wall.

[Valeria Maltoni]

@Tim - changing direction is easier with less might. If you've ever experienced rowing, you can do it alone if the boat is small, you need a coordinated team to do it in a bigger boat. Imagine what it's like to stir the Titanic! I would rather be unreasonable any day, logical keeps you on the same path as you're on, even as you spot the iceberg, to continue the same analogy. It's hard to grow mature and stay young at heart, yes.

@Nathan - yet, even in wiki-talk, it is only a self-selected group that really shows the way. Alas, organizations are still aligned behind the belief that information is power. The wall eventually crumbles. It is a sum total of many small clues that erode it and one would need to be in tune and want to see to be able to connect the dots ;-)