Josie Liu

[josiejliu]

Keeping Burberry in check

  Between 1997 and 2003, the iconic Burberry check underwent a radical branding shift. The change was not to replace any of Burberry’s long-held brand icons, of the check or the trench, but rather, to re-orient the brand identity behind the iconography, and re-center it back on its original identity. Over the past few decades, the brand had been damaged by significant dilution, from the licensing of the check to miscellaneous check-branded novelty goods, to the proliferation of counterfeit items mimicking the iconic trench coat and handbags. CEO Rose Marie Bravo’s approach to re-positioning the brand was to ‘prune and grow’ in two broad stages: 

First, pruning unwanted diluters and focusing the brand through:

Establishing clear boundaries: Burberry was defined as functional and aspirational; Bravo described this specific position in relation to other competitors (“between Polo Ralph Lauren and Giorgio Armani for apparel; between Coach and Gucci for accessories”) to clarify the boundaries of the brand and to set guardrails for the brand turnaround

Culling brand diluters: Bravo simplified the product line from 100,000 to 24,000 SKUs, removing many of the miscellaneous novelty items, such as chocolates, which threatened the main product line. Similarly, by curbing licensing agreements, and taking back control over design and distribution, Burberry re-assumed tighter control over a consistent core business

Increasing the price: Burberry’s prices were increased to be in line with its new brand positioning

Hiding the check: While highly recognizable, items which loudly displayed Burberry’s iconic check pattern were quickly becoming associated with cheap counterfeit products. Instead, by moving to ‘hide’ the check under collars or in the lining of items, Burberry sought to maintain the power of the check while dissociating from the mass-produced imitations.

Then, extending the brand in the new, desired direction through: 

Introducing a higher-end: Prorsum, as the high-profile, high-end line, helped to cement Burberry with its luxury competitors as a true player in modern fashion

Developing personas: Through advertisements featuring Stella Tenant and Kate Moss, Burberry’s brand and target customer were personified by not one, but two iconic personas. However, while the personas were positioned as being different (“good girl, bad girl”), both personas communicated style, luxury, and ‘British cool girl’ mythology which further reinforced the new brand direction

The control exhibited by this strategy highlights that brand strategy is not always about gaining mass appeal and diffusion. For Burberry, mass diffusion had led to brand dilution, so efforts to 'fix’ the brand actually meant alienating customers who were not Burberry’s target market. Once they did this, they could then focus on re-energizing the core customer base. However, once that customer base was activated, so too would have been the demand for counterfeit goods. This describes an inevitable cycle that many similarly recognizable luxury brands face. As long as a brand is iconic, desirable, but out of reach, there will be a market for counterfeits, and it will be hard to stamp these out without compromising the core brand itself. 

[josiejliu]

Apple’s new frontiers

The cognitive association of Singapore Airlines with industry-leading customer service is a hard one to displace. For almost 50 years, the airline’s objective has been to deliver the best customer service on the ground and in the air, and it has invested more than its competitors on aircraft, recruiting, and training to make this a reality. Even as new generations of ‘premium features’ have become standard across the industry, Singapore Airlines continues to innovate, to deliver differentiated service to its customers. Even facing an industry crisis in 2001, the airline proceeded with its plans to install business class seatbeds, doubling down on its value proposition in the face of uncertainty.

Singapore Airlines’ brand leadership can be compared and contrasted to that of Apple, which has undergone a different journey in recent years.

Over the course of a decade, Apple released generation after generation of iPods, iPads, and iPhones, generating demand for new features and sleek design faster than any of its competitors. However, in the last five years, Apple has faced increasing challenges to its growth. Smartphone penetration is approaching its limit, meaning smartphone makers need to rely on replacements for growth. At the same time, most consumers perceive the marginal improvements of the latest models to be less impressive than previous releases. Additionally, new entrants into the market, especially Huawei in China, pose a significant threat due to their ability to match features at a lower price point. Together, these factors have led to a significant slowdown of Apple’s smartphone sales.

Apple has tried to defend its leadership with the rest of its product suite. The ‘Apple Orchard’ of Macbooks, iPhones, iPads and Apple Watches form a tight, closed network, compared to the interoperability of PCs and Android devices. This not only creates a strong customer base likely to re-purchase, but also a strong value proposition to the customer once the ecosystem is fully functioning. Like Singapore Airlines, there is a strong demonstrated commitment to delivering the best-in-class experience for customers, in order to defend the brand’s position. Like Singapore Airlines, Apple is faced with a decision to double down on creating new features that make the price tag worth it, or to fall in line with a lower priced market and try to compete there instead.

[josiejliu]

Nudging the vote: Australian elections and the democracy sausage

In 2016, voter turnout at the US Presidential dipped to a 20-year low of around 60%, prompting discussion around the merit of compulsory voting. One easy comparison to draw is Australia, where voter turnouts of over 90% are common, and amongst the highest in the world. However, while voting is compulsory in Australia, the failure to comply results in a mere $20 penalty. While this might be some discouragement to voters, such high turnout rates are more likely to be explained by behavioral ‘nudges’ employed by the government to promote participation and remove barriers to voting. Some examples include: 

Most Australian citizens are automatically registered to vote on their 18th birthday, receiving a birthday card and small booklet explaining elections from the Prime Minister in the mail. 

Elections are always held on Saturdays, removing practical barriers to voting such as work schedules. 

Wherever possible, additional propositions and referenda are rolled into federal election ballots. 

Moreover, the mere knowledge that voting is compulsory and the promotion of high turnout rates reinforces the social proof of getting out to vote.

Perhaps most distinct to Australian culture, and potentially most compelling, is that elections are treated as a celebration. Local organizations including schools and community groups set up fundraisers at each voting location, barbecuing and selling sausages to voters who exit the polling area. This simple reward has come to be known colloquially as the “democracy sausage.” Balloons, games, and activities are often available to keep children occupied while parents perform their civic duty.

Many of these measures are simple but effective, and have been employed around the world. In Belgium, for example, neighborhoods treat elections as a local social gathering, and elections for different levels of government take place on the same day so as to reduce the burden of voting. The use of ‘I Voted’ stickers in the US are a step towards using behavioral nudges to prompt citizens to vote. One wonders whether democracy hot dogs and pretzels are just on the horizon.

[josiejliu]

Beer-stories

In the battle for imported beer, the strategy of letting quality speak for itself appeared to fall on deaf ears - that was the experience of Heineken, facing an increasingly dangerous rival in the Mexico-brewed Corona. In 1996, Corona was experiencing strong growth in the US, in large part thanks to its commitment to maintaining the story, or ‘myth’, of the brand. Advertising, pricing, and bottling all continued to maintain the narrative of “Fun, Sun, Beach”, and took pride in its Mexican heritage. While Heineken’s iconic red star was recognizable, it did not carry the strength of the Corona story. 

In modern times, few beer brands have invested as much back into the ‘myth’ as Guinness. The Guinness Storehouse at St James Gate in Dublin is less of a brewery and more of an indoor theme park. It contains fountains, shows, interactive pouring experiences and a floor dedicated to the history of Guinness advertising and the zoo of characters that have featured over the years.. At the center of the entrance, there is a glass panel in the ground which overlooks the 9,000 year lease that Arthur Guinness signed in 1759. 

Guinness’ legend has protected its position as the market leader in stout beer, which represents between 1-2% of beer consumption in the US (lager, where Heineken and Corona play, represents around 80%). Yet, the power of the Guinness brand seems to outperform its own category, while proving to other brewers that preserving and promoting the ‘myth’ is as important as ever. 

[josiejliu]

A chip for the people

Back in 2006, the Intel Pentium sticker on my first laptop fell off. Inexplicably, I took the laptop to my school’s IT Helpdesk, nervous that in some way I had damaged or devalued the computer. I couldn’t explain to you what Intel did or how they had contributed to my laptop, but the association between the Intel sticker and some kind of quality assurance was undeniable.

It turns out this has been Intel’s goal for the last 30 years, when the world’s leading microprocessor company decided to pivot marketing efforts away from computer engineers towards and towards the mass market. For the end-consumers who might purchase an Intel microprocessor as part of an assembled PC, Intel wanted to press the importance of having the latest edition, even if they did not understand the technical differences.

Intel’s marketing strategy is marked by two key approaches working side-by-side:

- Entering advertising partnerships with OEMs: In the early 90s, Intel required PC manufacturers like Dell and IBM to display the Intel Inside logo in all advertising materials. As a result, Intel was successful in making the Intel Inside logo ubiquitous with computers. 

- Building the Intel Inside brand as a personality: Given the pivot away from computer designers to the end-consumers, Intel’s marketing materials focused very little on technical aspects of the product. Instead, Intel used novel, sometimes absurd, advertisements featuring the Blue Men Group and ‘Bunny People’ to draw associations with creativity and performance, and of course, to entertain.

Thanks to both strategies, Intel has been able to maintain its market leadership, and has developed a brand that extends beyond the microprocessor market. In building this approach, Intel also leaves behind a blueprint for emerging technologies: how they can appeal directly to end-consumers, bypassing hardware manufacturers and technical conversations altogether. For Intel, whose technical expertise could back the claim up, this success was sustainable in the long-term. It will be the responsibility for newer technologies to ensure they are able to deliver on the same.