INDUSTRIAL BRANDS: THE OPPORTUNITY FOR COESIA

by Jonathan Salem Baskin

Industrial brands command a price and loyalty premium above lesser-branded rivals, but not for the reasons you might expect. Recognition might make it more likely your business will be added to a list but there's no correlation between better marketing awareness and profitability. In fact, many of the best-known industrial brand names track or trail the averages for their industries (this could be due to the fact that they help set those averages, of course). In studying performance of brand names on three continents, this conclusion is inescapable: better branding doesn't yield business success but, rather, better businesses yield better branding (and better results).

It's a simple equation that turns a lot of marketing theology on its head. The case histories are many: Consider Rolls Royce, which had a near-tragic failure of its leading Trent 900 engine in late 2010. According to most brand experts, it failed to properly market itself in the aftermath of the crisis. It didn't tell people what its brand meant; instead, it focused on fixing the problem and working directly with its customers, vendors, and employees. Less than two months later it wrote its largest-ever order for jet engines (the same model that had failed!) and another division wrote its biggest contract to supply ships.

Another example would be Xerox, which has migrated its business from hardware to the services that surround its equipment. No amount of marketing communication could change the fact that its devices were becoming commodities so it built the business offering that added value to them. It's interesting that it didn't reveal its current new logo until after it had proven this new corporate strategy, so its branding was a narration of its activities, not an empty promise.

Conversely, we've seen otherwise well-known and valued brand names lose their credibility in almost an instant, such as BP and Toyota in the U.S. Both brands were built on very smart and memorable marketing strategy that didn't accurately reflect what the businesses were doing. Once that disconnect became apparent to their customers and consumers, those brands were punished.

The bottom-line? Great brands aren't built by going "back to the basics" but with "starting with them." The opportunity for Coesia is to define the business processes, products, and services that differentiate your brand from its competition based on the tangible, objectively verifiable benefits they provide to your customers. These qualities can and should be evident across your current brands. Then the challenge will be to the marketers to discover ways to make these truths available and relevant to your customers.

ON Review 1 | 2012

ON Review 2 | 2011

ON Review 1 | 2011