Brand leadership has to change

A few years ago, shortly after the 2008 crash, American Express in the United States paid many of its less profitable customers to close their accounts and go away. The move garnered much attention and analysis then. It was seen as a de-leveraging move. Whatever hubbub surrounded the brand then has since died down and in an unscientific survey of my business-savvy friends, few remember that this happened at all.

It was a story of a brand choosing its customers, rather than the dominant narrative that conventionally goes the other way round. The latter powers the nascent GrabYourWallet movement.  Another campaign, Sleeping Giants, is similarly holding brands and companies to account if they continue to advertise on extremist websites.

These are interesting times, as the Chinese curse goes.

As consumers, we profess to love brands that are “authentic“, never mind that in many cases, contrived authenticity, not rooted in values embedded into the business’s value chain, is all we are getting excited about.

What happens when “authentic brands” meet programmatic advertising? Unfortunate, inadvertent outcomes, that is what. Brands are left scrambling to do damage control.

What happens when “authentic brands” take a stand that is vastly unpopular? What happens when the brand’s CEO tells a customer she is free to leave if she does not like their philosophy? Isn’t that just the brand being authentic?

What when all signs point to the emergent challenges being bigger than the more popular political bugbear of the time?

Is authenticity malleable? Should it be?

What if a brand never had cause to reveal some of its stances before and is now choosing to do it in a way that consumers find abhorrent?

And when that comes to pass, should consumers force the brand to comply with their idea of authenticity, or choose to walk away with their wallets?* After all, wisdom says, when facts change, changing our minds is no bad thing.

These growing disagreements and schisms are why, more than ever before, brands need values at their foundation, in their DNA, embedded in their value chain.

Real, defensible, explicit values that the brand is willing to stand up for.

Not convenient values that change with the times or fads du jour.

It is then that brand managers will truly be able to use programmatic advertising as a tool to help them rather be helplessly enslaved by it, while they operate in a haze, whether it be about their brand values or technology.

It is then that “customer choice” will come to mean both that the customer chooses, or rejects, the brand and that the brand chooses, or rejects, the customer.

[* Switching costs for small businesses on a shopping cart platform are not negligible but then that is an economic argument, not one about values.]

 

Authenticity and Vedic wisdom for luxury brands

Alicia Keys, the talented musician and singer, was in the news recently for having chosen decidedly to eschew makeup. In a monograph in a newsletter, she said she feels no need to cover up any more. She talked about her journey to self discovery and finding her authentic self which did not need to be hidden under layers of makeup.

On cue, and missing all the irony of Keys’s commentary, Harper’s Bazaar featured 74 models in selfies with the faces they were born with. Hashtag #nomakeup.

Ladies & Gentlemen, authenticity is now on trend, and branded.

In a related development, one of my favourite web friends, Jackie Danicki, has started writing Burned Out Beauty, a beauty blog which is my new not-so-secret indulgence. She was the original beauty blogger in 2004 on the world’s first beauty blog Jack & Hill.

Jackie is not being a contrarian. She took a break, so to speak, and she is back doing something that she loves, enjoys and is knowledgeable about. Jackie is authentic.

The good thing about being authentic is there is no need to be contrarian.

But how can brands find where their authenticity lies? Indeed what is authentic and what are the sources of authenticity?

Eagle-eyed readers will remember my agonising over the “authenticity” of the Porsche symposer some time ago. I ruminated on it a while. After all the car is man-made, as is the symposer, and it is humans that manifested the Porsche vroom in the car’s engine as well as the symposer. It is not about the engine, it is about the sound. Once I had reached that essentialist unifying thread, I was at peace.

Where a sensory signal is not the only or the main signature of the brand, a brand may have to work a tad harder to define what it stands for, what its authentic self is.

A beautiful and effective tool is to be found in a Vedic method of inquiry.

What the essence of something is is often arrived at by answering what it is not.

Neti-Neti. Not this, not this.

Unlike other fixed signals of authenticity, the process of Neti-Neti also accommodates indeed nurtures growth and reinvention. If we are no longer something, if we no longer stand for something, we are one step closer to being our authentic and whole self.

So with brands.

When luxury brands with deep heritage struggle to reinvent themselves and their relevance in a world with modern technology and newness, they can choose to look inward and answer what they are not.

What are you not, any longer?

Authentic & still relevant

Influencer marketing and the luxury marque

Eight years ago, I was pondering the meaning of “authority” on the web. Fast forward to 2016 and the language has moved on. It is no longer about authority but about influence. Brands, including some luxury brands, are engaging in “influencer marketing”.

The web is awash with “advice” for luxury brands on the criteria for choosing the right influencers; these include relevance, reach, engagement, previous brand endorsements, and that old chestnut called authority.

But should luxury brands engage in influencer marketing at all?

I have no doubt there are some, who were influenced into buying a Breitling because of John Travolta, a bonafide and accomplished pilot and a 2007 inductee into the Living Legends of Aviation. Travolta was the face of Breitling until in 2012, Breitling shocked many by picking David Beckham. Beckham is a famous former ace footballer but now mostly a celebrity model, who reportedly turned down Calvin Klein but later appeared in Giorgio Armani and H&M ads — for underwear.

How are Breitling’s brand values aligning with this new choice of influencer? What aspirational quality or relatable values is the brand projecting with David Beckham? Notwithstanding his sporting prowess, Beckham is a peculiar and unimaginative choice of influencer for a brand that, since 1884, has been known for engineering innovation driven watches.

IMG_3407During the AW16 shows in Milan, Gucci’s Alessandro Michele officially invited — and collaborated with — Trevor Andrew whose love for Gucci had made his “Gucci Ghost” persona well known and gained him a huge following on Instagram (31K at the time of writing). Andrew bought his first Gucci watch at age 17 with the money he earned snowboarding. Gucci wasn’t giving him money to talk Gucci all this while (for the various shades of disclosure between bloggers and luxury brands, read this). He is no ordinary influencer for Gucci to engage with. He has his own creative lens on things, including to his music — he is a man of many talents — with a rip-mix-burn approach he puts to practise and that resonates with web users. Web culture has indeed moved on from the early binarity of creator v consumer, to co-creation and hacking.

Does Andrew resonate with Gucci’s brand values? They are, after all, rooted in the Italian and Florentine heritage and craftsmanship. Where does Andrew fit in? Perhaps with Gucci’s fashion leadership and success with authenticity? Andrew is authentic, creative, successful with his own style of craftsmanship. There is synergy perhaps, and Gucci put its money where its mouth is by producing a collaborative collection with Andrew.

Both brands Andrew and Gucci have influence over their audiences.

But in the collaboration, who influenced whom? It is hard to tell. It is more like a circle of virtuous mutual influence! This kind of serendipity, overlaid with a strategic twist is not available to all luxury brands.

Luxury brands are currently torn between many dualities. The democratic nature of the web, versus the exclusive, aspirational image of a luxury brand. The reality of who is spending the money now, versus the need to build relationships with the potential customers of the future. Even the heritage claim becomes difficult to ride on, when the brands are addressing markets with their own heritage vastly more expansive and richer than the luxury marque’s own.

Amid all this, the question — should a luxury brand engage in influencer marketing at all?

My considered answer to that is No.

A luxury marque is, at its core, a Veblen good. Influencer marketing — including the lazy marketer’s option of celebrity endorsement, never mind their tenuous relationship with sales — on the other hand is an attempt to get in on the bandwagon effect (economists call it “interpersonal effects on utility”). Influencer marketing, given all the variables in the mix including the influencer’s own “brand” and its values, is cognitive dissonance-inducing in the luxury brand discourse.

“But, but what about the young generation and our engagement with them?,” some might ask.

The clue might lie in a 600 year old brand that somehow survived and thrived.

With the old fashioned idea of always being the keeper and regaler of the brand story, the craftsmanship story, the collection story. Even the influencers it has worked with in recent times are now collaboratively embedded in its glorious historicity.

When it comes to influencer marketing, true luxury marques need to remember just this:

Don’t borrow someone else’s influence. Be the influence.

Luxury watches and tech: who is driving whom?

Luxury products, it seems, are being trampled over by technology-enabled products enticing luxury customers.

Apple created its own version of ceramic enforced gold. The real number of the Apple watches in gold casing shipped remains a mystery although an estimated total of 10M pieces are expected to have shipped by the end of 2015.

Apple approached Hermès, the 600 year old luxury marque for a collaboration. Possibly so Apple could open a new market for itself and Hermès could make its mark on tech savvy luxury buyers.

Hermès, however, is an odd choice, seeing as it is far from being the top luxury watch maker and seller. Apple gets to borrow Hermes’s aura, their channel and possibly their customer base — Hermès does not market aggressively to its masstige customer while its prestige customer may or may not like being sold to — and Hermès gets to sell some fabulous leather straps to Apple. The collaboration looked like Apple is driving it.

Meanwhile out of Rolex, Omega and Breitling, the top 3 luxury watch marques, only Breitling has dipped its toe in the smartwatch waters. With its Breitling B55 Connected.

Brietling’s vision is to make the phone subservient to the watch, to enhance the watch. To wit: “In creating its first connected chronograph, Breitling has applied a new philosophy placing the smartphone in the service of the watch so as to enhance its functionality and conviviality. The instrument of the future.” The Breitling B55 Connected builds on the earlier launch of B50, which is an an electronic multi-function chronograph movement, with analogue and digital displays. The idea was to serve pilots — Breitling’s primary audience, but also its aspirational audience — better and to pave the way for other developments.

A few others have made their first moves too. Gucci unveiled a high fashion version of Will.I.Am‘s smartband. Will.I.Am’s role as the creative innovation lead in Intel’s wearables business is not widely known. He is not afraid to fail or experiment. Movado has teamed up with HP to create an Android and iOS compatible watch – the Movado Bold Motion – which uses Bluetooth connectivity and vibrations and visual cues to upcoming important things, all while looking stunning as Movado watches do. At Baselworld 2015, Bulgari unveiled its Diagono Magnesium Concept watch. The watch uses WISeKey’s NFC chip to unlock an application that can store encrypted data on the cloud and communicate with other devices within its range. The data is reportedly secure in an underground bunker in the Swiss Alps. Um, ok. WISeKey’s technology works with both Android and iOS. Then there is Tag Heuer’s Connected, which runs Google Wearable OS, and the order numbers have just been upped significantly to serve the upcoming holiday demand.

With all these options, one wonders: What does a customer choose first — the watch or the technology platform/ OS? More to the point, will the technology platform ever drive a watch purchase?

Curious, I conducted an unscientific survey of (admittedly male) friends, who own watches each costing over £10,000. Unsurprisingly they are all eyeing the Tag Heuer and the Breitling, but not as their main watches.

“Look, I need the battery to last weeks not 6h. I sometimes have two flights to catch in a day and a tight meeting schedule in between.”, said one.

Another said, “As I become more senior, I am less interested in being available to all messages and people all the time. I need time to reflect, uninterrupted by pings and notifications, and as far as I can tell that is all smart watches are doing right now.”

“Whatever it is, I ain’t changing my mobile phone for a god-damned watch. Something will come along that suits me and does not ask me to suit it. Capiche?”, said another. Ooh, burn.

So, if the smart watch is not the main watch, is the connectedness spiel just another nice-to-have and not really a need-to-have feature?

What does that mean for the market that can actually afford luxury smart watches?

Who understands this subtlety of customer behaviour in the luxury market?

It sure ain’t Apple. Or HP. Or even WISeKey.

The luxury brand, on the other hand, owns the customer relationship and understands their customers’ behaviour and quirks. The brand also gets to choose which tech to use, and may choose technologies that are OS-agnostic so as to serve all of their existing customers. The brand, if not inclined to investing in development by itself, could always reach out to wearable companies such as Olio Devices, which were among the first to understand that the customer doesn’t want to change her phone OS, based on the watch she covets.

So, back to — who is driving whom as far as luxury watches and tech go?

Tech may have started it all but tech isn’t driving the conversation in this space any more.

As luxury goes, consumers rule, and luxury brands are expectedly showing a more subtle understanding of the consumer than tech players may assume.

PS: I am an all-in Apple ecosystem user.

Four For Friday (29)

The luxury sector is negotiating the tight rope between its traditional exclusivity and the open-all-hours, democratising nature of the web. It is a fascinating space to watch as new ways of enticing and engaging with the customer emerge.

This long Luxury Society piece explores the emerging influencers and how brands are finding their feet in this new dance. The most telling line in the piece:

“The internet is a chance for luxury, because in order to maintain the dream value of the brand, you have to permanently refuel that dream…”

Refuelling dreams repeatedly is easier when the shop front is really open-all-hours as the web makes possible.

Relevance. As thing go digital at a rapid pace, relevance is the holy grail for luxury brands too, as Rebecca Robins writes.

An even more fascinating movement among the legacy brands is the movement across brands – the “brand tangos” that boost their reputation through collaboration. Think the Apple Watch Hermès cross-over. Legacy brands are tapping into tech brands to increase awareness and connect with consumers. Tech brands are tapping into legacy brands for their heritage and exclusivity.

The resulting blurring of boundaries increasingly calls into question whether we will even be defining brands by sector in years to come.

Talent is central to this ongoing quest for relevance. Lately luxury brands have been poaching talent from among mass market brand leaders. The skills at a premium? Time to market and omni-channel reach.

“Traditionally reliant on in-store experiences, the luxury end of the market is slowly realising that online retail is a crucial factor in future growth. .. Luxury brands are looking for broader retail skills to match today’s omnichannel retail world, Twyford said.”

“Twyford explained that luxury brands pale in comparison to the likes of Uniqlo, H&M and Zara when it comes to their speed to market. As mass-market brands soar in their ability to maintain low-costs while still appealing to millennials, logo-reliant brands like Ralph Lauren feel static,..”

And finally, a luxury good we all desire more of — silence. The essay discusses advances in airlines and automotives, to create silence which may be physically nauseating — our vestibular system draws upon noise to give us a sense of balance and spatial orientation —  and ends on a note which summarises why silence is truly a luxury good.

The hushed halls of affluence buffer the rich from the hubbub of poverty, but for the poor, the clatter of modern life—like other forms of pollution—is inescapable. And as noise continues its inexorable advance into the quietest eddies of wilderness, even the rich may find a silent retreat impossible to locate.

Bonus link: An impossible to locate silent retreat is what Rachel Nuwer found when she set out to locate the last place on earth without human noise. Two fascinating nuggets stand out:

Hempton and Krause hope that nations will adopt a quiet area program akin to dark sky programs. They are pushing for the US National Park Service to adopt such regulations in 2016, in time for the agency’s centennial. “I absolutely believe we will have our quiet places,” Hempton says. “Just like we went through with water quality, things have to get really bad before we recognise them as a basic value and clean them up.”

Where others tend to become uncomfortable in the disconcerting silence, Foy relished the chance to be completely cut off. But minutes into his stay in the chamber, he noticed that the silence was in fact broken. His own body, it turned out – his breathing, his heartbeat, even the scratchy sound his scalp made rubbing against his skull when he frowned – was betraying his quest for auditory nothingness. “The only time you’ll hear absolute silence is when you’re in no position to hear it, because you’re dead,” he realized.