Marketing 8.1

Breakaway Brands:

Connecting with Customers

"Big blue-chip companies like General Electric and Microsoft do many things well," notes a brand analyst, "but showing up on lists of the hottest brands is typically not one of them. Yet these two lumbering giants both made their way onto brand consultancy Landor Associates' annual Breakaway Brands ranking—a comprehensive survey that measures consumer sizzle."

Each year, brand consultancy Landor Associates, an arm of ad agency Young & Rubicam, conducts a "Top Ten Breakaway Brands" survey in which it identifies the ten brands with the greatest percentage gains in brand health and business value as a result of superb brand strategy and execution over a three-year period. The survey taps Young & Rubicam's Brand Asset Valuator, a database of responses from 9,000 consumers evaluating 2,500 brands measured across 56 metrics. Landor looks at brand factors such as differentiation, relevance, esteem, and knowledge. At the same time, another consultancy, BrandEconomics, assesses the financial performance of the brand ("Economic Value Added"). Combined, the Brand Asset Valuator and Economic Value Added models provide a brand valuation based on both consumer and financial measures.

Ideas about achieving brand strength, that elusive blend of awareness and trust, have changed in the past decade. "It's no longer, What can we blast out there about ourselves?" says another branding expert. "Brand theory now asks, How can we connect with the community in a really meaningful way?" It's a big question. Armed with information about price and quality, today's consumer is a tough challenge. But, says the expert, "if you're willing to talk directly and deeply to your audience, you can become a strong brand without a lot of fanfare."

The most recent Breakaway Brands list includes a strange agglomeration, from hot technology brands such as ¡Pod and BlackBerry to blue chips such as GE and Microsoft to down-and-dirty discount retailers such as the retail discount chains TJ Maxx and Costco.

Breakaway brand BlackBerry has perfected a truly unique community-building tool. Today, it is becoming increasingly difficult within the business community to imagine life before BlackBerry.

Top Ten Breakaway Brands

1. TJ Maxx

3. BlackBerry

4. Stonyfield Farm

5. Samsung

6. Costco

7. Propel

8. Barnes & Noble

10. Microsoft

Missing are some brand titans such as Coca-Cola (big but not growing very fast) and fresh-faced young brands like MySpace (the consumer panel consists of adults 18 and older, so the youth-centric sensation doesn't show up yet). But Landor found that each brand that did make the list embraced one or more of three themes. "Today it's all about trust, community, and creating a dialogue with your customer that shares real knowledge," says Landor's chief marketing officer. That is, all of the brands really connect with customers.

So, how are older brands such as Microsoft and GE connecting with consumers? Microsoft's resurrection from its corporate-bad-guy status of past years results from several factors. More consumer-connecting products such as its Xbox game console now give Microsoft a cachet that even dominant office-related brands such as a PowerPoint and Word never could. And the good works of the Bill & Melinda Gates Foundation have also helped to boost consumer trust and community, helping to foster perceptions of a kinder, gentler Microsoft. Finally, as new corporate bogeymen like Google and MySpace owner News Corp. begin throwing their weight around, Microsoft now "comes off as an underdog even though it is a behemoth," says the brand expert.

General Electrlc's appearance on the breakaway brands list derives almost entirely from its "ecomagination" environmental efforts. Between 2005 and 2010, the company aims to more than double its annual research budget for cleaner technologies—like energy-efficient refrigerators and wind turbines. Last year, GE's increasing connections with customer and community concerns about the environment generated $12 billion in revenues from 45 ecomagination products and services. "They are trying to turn that entire ship into the ecovessel of the future," says Landor's chief marketing executive.

iPod and BlackBerry—that's more like it! These are brands that you'd expect to see on a Breakaway Brands list. Among brands that foster customer community, the iPod is an obvious winner by virtue of its ability to create an online music ecosystem virtually overnight. With each new product introduction, iPod and Apple advance the causes of democratizing technology and approachable innovation.

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Marketing 8.1 Continued

Similarly, BlackBerry maker Research In Motion perfected a truly unique community-building tool: a user-friendly device that lets business people stay connected to their jobs and to each other. Jokes about "crackberry addicts" and the appearance of BlackBerry smart-phones in the hands of celebrities from U.S. talk show host Oprah Winfrey to the popstar Madonna illustrate the brand's rapid rise. "Today, virtually the world over," says a Landor analyst, "it is becoming increasingly difficult among the business community to imagine life 'BB' (Before BlackBerry)."

If iPod and BlackBerry seem like naturals for a Breakaway Brands list, an unlikely pair of retailers—TJ Maxx and Costco—just don't seem to fit. Yet in these difficult days of rising costs and splraling economics, the two fast-growing discounters are creating treasure-hunt experiences that build strong emotional bonds with customers. TJ Maxx—at number-one, no less—fulfills the fantasy of luxury for less. At TJ Maxx, saving is no longer a priority reserved for the lower- and middle-income consumers. Now, even the most affluent shopper can experience the "thrill of the save" and the euphoria of a great "Maxx Moment." Similarly, Costco helps customers to save on everyday purchases while also experiencing great deals on high-end products. Says the Landor analyst, Costco has "perfected the art of understanding not only what customers need, but also what they fantasize about, and putting both at their fingertips."

As proves true each year, Landor's breakaway brands list includes some old standbys and a number of pleasant surprises. As the analyst concludes:

In today's uncertain world it is no wonder that organizations have to work harder and harder to gain the trust of their [customers] in order to be successful. What's more, [with brands], as in life, trust must be earned, not bought, and it must be constantly validated. The . . . marketers at the helm of this year's Top Ten Breakaway Brands understand not only the need to connect with their customers and instill trust, they also understand that brand is one of the most powerful tools available for making those coveted relationships a reality.

Sources: Based on information from Matthew Boyle, "Microsoft and GE: Not Old and in the Way," Fortune, November 12, 2007, p. 28, Ellen McGIrt, "Breakaway Brands," Fortune, September 18, 2006, p. 27; and Chelsea Greene, "Using Brands to Drive Business Results," Landor Brands, November 2008, accessed at www.

Brands are powerful assets that must be carefully developed and managed. As this figure suggests, building strong brands involves many challenging decisions.

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