24 Apr Challenging the way we build brands.
The new black book of branding examines the brand perceptions and effectiveness of brand practices in Malaysia. Sandeep Joseph, Head Strategy+Digital, Zenith Media, speaks to brand strategist Yasmin Merican, CEO of Trax Associates and author of ‘The Right to Brand’.
‘The Right to Brand’ is the first book written about the Malaysian brand building experience. Tell us why you wrote this book.
After working in both the advertising and business consulting industries over the past 20 years, I thought it curious that while the ability to build brands continue to sustain the market advantage of the branded, the economic significance of the process is not as clear, or as credible, to the majority of our companies. If business is all about customer acquisition, retention and growth, why are we not sustaining investment in brand creation to secure, if not defend our place in markets? This book looks into this baffling practice where management belief in brand power is not matched by brand commitment and investment.
Although branding is an old craft and a mature market skill where more than 80 percent of the Top 100 most valuable brands are from the United States and Europe, many countries in Asia such as Japan, South Korea, Singapore and now China already know that brand power is as important as business power. Although Malaysia has long shared this commitment to build stronger brands, our business practices do not demonstrate that we are on the way to better branding. The question is: why?
The answer can only come from on-the-ground experiences and behaviors, which the book documents. As all other books on branding have been written by authors from mature markets or by western authors profiling Asian branding experiences, I thought the perspectives of a local practitioner who has worked on brand projects with both local and international companies, would surface new insights as to why Malaysia brands, or do not brand.
What is the central premise of the book? How is the branding challenge in Malaysia different from other countries?
‘The Right to Brand’ attempts to build a strong case on why Malaysian stakeholders need to take another look on the role of brands, not just through downstream activities such as marketing, advertising, communications or design, but how these activities are anchored in corporate or business policy. Our research shows that not enough companies in Malaysia have this policy where brand thinking functions early enough in the strategic planning cycle. Instead, investment in product and service development, technology enablement, customer management, skills enhancement are all made to respond to business but not brand needs. What then happens is that marketing, operating further downstream, usually has to deliver on the impossible feat of competitive differentiation through communications or advertising. Unless marketing has a stronger voice at board or corporate planning levels, it is difficult to live up to brand promises when the process does not start further upstream.
It was interesting that while we thought our research and observations on the downstream vs upstream branding was typical of Malaysian business practices, we were told by others in developed markets that the symptoms were also evident in mature markets.
Who is this book targeted to?
In the building of an effective brand, there are three key groups of stakeholders. The brand owners, the brand builders and the brand ecosystem. No brand anywhere in the world can be built without active participation of these three groups. In Malaysia, branding is strongly associated with marketing and advertising. Perhaps it is the same elsewhere. Without the skills of the brand ecosystem populated by world-class advertising, communications, media and design agencies, brands just do not, and will not, happen. Yet, the primary movers of effective brand building are the brand owners.
This book is therefore targeted not to those within the brand ecosystem although I hope they will find it interesting, but specifically to the brand owners – entrepreneurs, Boards and CEOs.
So what needs to be done to make Malaysian brands stronger?
As I mentioned earlier, the skills of the brand ecosystem and the downstream activities such as marketing and advertising, public relations, and to a lesser extent design, are already relatively mature. The quality of our communications campaigns is world class and the media dollars we spend on these activities each year reinforce the commitment Malaysian companies make towards this end. However, we need to get similar skills and commitment for brand building upstream – the more important segment for better branding – to ensure the life and durability of a brand. Without the longer term commitment and investment, advertising and communications cannot sustain a brand. How many times have we seen great Malaysian brands with the market potential, suffer from the indecisions of changing managements and the general lack of brand knowledge at an organization?
In your opinion, what is the main challenge facing Malaysian companies in their attempt to build stronger brands?
The main challenge is really mindsets. Ten years ago, we conducted a nationwide study of brand practices with the Malaysian Institute of Management (MIM) and PwC (PricewaterhouseCoopers) and the results demonstrated that our Boards and CEOs knew the importance of brand building to the competitveness of their business. They also knew that not enough was invested in brands and this was attributed to the lack of brand knowledge and capabilities. Unfortunately, not much has changed today. Brand health and the economic value it generates through the building of market goodwill are still not on Board agendas.
Although it is much easier for entrepreneurs and owner-managed companies to build brand value, how do you mobilise Board or CEO support at multi-stakeholder companies to commit to an investment where returns on investments (ROI) have yet to be demonstrated? Who will take the first step to start building reusable knowledge? With pressures to perform on a quarterly basis, not many CEOs would want to attempt a new process on only the guarantee of essential learning and competencies without the early ROIs. Yet this delay to commit to better branding delays our overall competitiveness as a nation, company, product or service.
There are also a lot of real-life examples in the books. Did you have any concerns in this area?
I chose to write about the experiences of real companies because it improves the credibility of the cases. Otherwise, the cases will come across as third party observations which might not be as convincing. Furthermore, for the sake of collaborative learning, I wanted to show the good – as well as the not so good – decisions made by various ‘actors’ when their brands were being built. Brand history has shown that even the great brands like CocaCola makes mistakes and the dynamic among the different brand decision-makers was an important aspect of the book, which I wanted to illustrate.
With the rise of new media like digital ad social media, do you think that branding has changed?
No, I don’t think the principles of brand building have changed regardless of the rise of new media. In the book, we suggest a simple framework called the Brand FCD© to demystify the brand building process, where branding is nothing more than the successful integration of ‘form’, ‘character’ and ‘delivery’. Essentially, what people see, feel and experience in your brand. Regardless of your media choice, the rules of brand building do not change. The only thing that changes with the new media is the way you communicate with markets. The job of an effective brand builder is to be alert to changing influences be it on brand form, character and delivery and use these new resources to advantage.
To many businesses, pricing strategy is often more important than the brand. At AirAsia, they have built a brand on a pricing premise. Do you think brand building can co-exist in a world of comparison shopping and low-price leaders?
Harvard Business School professor Michael Porter said that in order to compete effectively, you must either be a cost leader or your products must be sufficiently differentiated to generate premium pricing over others. Today, more are of the view that you can do both and still succeed. You can be a cost-leader, but you still have to build a strong and differentiated brand. I think AirAsia and IKEA are two very good examples of companies who succeed on both cost-leadership and differentiation. Their brands signal premium value, but their business policy is to engage in value pricing across products and services. So, the ability to brand is a competitive advantage for all businesses: low price leaders and high-end operators. The trick is to know how to combine the two.
What is your advice to Chief Marketing Officers today?
CMOs should be give the opportunity to function or be empowered at strategic levels of organisation. Many still are not. Not all marketing directors are members of Boards and not many CEOs in Malaysia come from marketing backgrounds. Two exceptions are the CEOs of AirAsia and Celcom who both deep brand knowledge and capabilities. No surprise as to why the two companies have succeeded in building enduring brands.
However, all is not lost. To spur effective brand action, you need to find the best knowledge and skills available. The skills could come from within your organization or from the brand ecosystem. But you must find them and grow their skills though stronger leadership commitments and policies. Otherwise, we will have little control over the fate or sustainability of the brands we build.
(This article first appeared in August 2013 issue of MarketingWeek)