Issue: Online Communities and Brands – Our New Hometowns
Commentary by: David Vinjamuri

[Image from Church of the Customer]

Douglas Atkin, author of The Culting of Brands has a theory about people in the 21st century. We’ve mostly been torn from our hometowns. We don’t live with our grandparents or parents and may not even know our neighbors. We may share an income level with them but we might not share other core values or beliefs. Increasingly, we use brands as a short-hand to communicate our values to our neighbors and those we encounter socially. Driving a Volvo? I know you’re affluent, have kids and probably send them to private school. A Prius? We obviously are both Dems who share a passion for the environment. Wearing Ralph Lauren? You have money, like to make a nice impression but think fashion with a big “F” is vulgar.

The question brand marketers who see this are asking is: how will this translate to the online space? So we are all watching online communities very closely. With a few key exceptions, many online communities started by marketers are clunky, unusable affairs. We brand people are far too nervous about control to nurture communities well. Some good lessons come from urban planners. They have learned that tightly controlled or barren spaces actually attract ‘undesirables’ (drug addicts, homeless, vagrants, skateboarders) because they cannot be customized by the community. Thus, when Bryant Park was designed, over 1000 lightweight chairs were included, which were intended to be moved by park visitors. The park continues to be a safe and vibrant space.

There aren’t any definitive answers for brands with online communities, as the models are fast evolving. Sites like craigslist.org, FlyerTalk and TivoCommunity have created strong communities of interest, but they are not fully evolved social networks. Many social networks, like Facebook and MySpace are less efficient as brand havens (with the notable exception of the success of independent music on MySpace). Private label sites like NING allow brand marketers to create gated or single-interest communities, but are still in early stages of development.

The Church of the Consumer described an interesting framework (crediting Ray Bard for the visual reproduced above) for thinking about different types of online communities, or different stages in the development of an online community. Cliques are small, exclusive and anti-establishment. Networks are large and intended to facilitate introductions or the spread of information. Cults have rituals, belief systems and charismatic leaders. Finally, Nations are egalitarian, sovereign and committed to an all-consuming cause.

This leaves open the question of how a brand can create an online community. For this, I was happy to get a sneak peak at Forrester’s new report on Online Community Best Practices (thanks to Jeremiah Owyang and Tracy Sullivan). Forrester is careful to differentiate the different reasons that brands form online communities into Listening (an online standing focus group), Talking (get across a brand message), Energizing (nurturing brand enthusiasts), Support (allow brand users to support each other) and Embracing (involve brand faithful in developing the brand). The report goes on to describe some of the steps in creating an online community and – importantly – how to deal with different types of online troublemakers. At seventeen pages, it is still a brief summary, but very useful for those considering a plunge into the water.

Issue: Why are retailers suing their customers?
Commentary by: David Vinjamuri

We have been ranting for some time about companies that pursue business strategies that harm the brand. A Wall Street Journal front-page article yesterday highlights another such practice. Companies including The Home Depot, Wal-Mart and Lord & Taylor are hiring law firms to threaten or pursue civil litigation against suspected shoplifters to recover damages. They do this in addition to criminal proceedings.

If handled appropriately, this might not be a foolish practice for the brand. Recovering damages from those who have committed criminal acts against the brand lowers the cost for law-abiding consumers. Unfortunately, like many other practices administered by corporate financial people without any brand oversite, this one casts too wide a net with disastrous results.

In one case cited by the Wall Street Journal, a handyman in Miami named Glenn Rudge was detained at Home Depot after he checked out because a clerk observed a set of $8 drill bits poking from his shirt pocket. He was handcuffed in the store by a guard and the store refused to let him call home and ask his wife to bring the receipt for the drill bits in to the store. He was charged by prosecutors who then dropped the charges when he produced the receipt.

To add insult to injury, a month after the charges had been dropped, Rudge received a letter from the Palmer Reifler law firm demanding $3,000. That sum increased by another $3,000 when he ignored the letter. Mr. Rudge was threatened with a visit from the Sheriff’s office in the second letter. Fortunately, Mr. Rudge was doing handyman work for an attorney who filed suit for him and recovered undisclosed damages from Home Depot.

This example is one of many detailed by The Wall Street Journal and experienced by innocent consumers around the country. Retailers are combating a real problem – the estimated $40 billion annual cost of shrinkage (losses to theft, shoplifting and other consumer fraud) – but doing so in a manner that harms their brands and causes unmeasurable damage to their revenue.

This all stems from a very anti-brand attitude which assumes that consumers are all guilty until proven innocent. The price for this belief is huge reputation damage in word of mouth and negative publicity.

Retailers would be wise to adopt a more customer-friendly attitude towards potential theft. A few thoughts:

1. Approach customers politely – some of them will be innocent.
2. Do not forcibly detain customers – unless unambiguous evidence of a crime exists.
3. Allow customers to explain – accept reasonable explanations even if some may be false
4. Do not sue customers – who have been judged innocent in criminal court.
5. Add common sense to your shrinkage policy – why are customers purchasing hundreds of dollars being detained for $8 items?

It seems unlikely retailers will heed these warnings. In spite of repeated negative publicity, they continue to learn lessons from the music industry – suing their own customers until they have no business left.

Issue: As the Writers Strike End, Network Executives Contemplate Alternatives to Pilot Season
Commentary by: David Vinjamuri

The strike may be over, but the longterm effects of the Writer’s Strike are only just beginning. Chief among them is the question of how to develop new shows for network television. The old model – a pilot season where money is lavished on producing many shows which never see the light of day – is expensive and inefficient.

The answer to this question already exists though – and it’s in a place few are looking for examples these days – major league baseball. The major leagues understand that very few high school or college baseball players are ready to hit 100mph fastballs on day one. Instead of setting these guys up for failure, they send them to compete in leagues designed to develop their skills. Those who flourish get a chance to join the big show – the major leagues.

Network executives have already accidentally done this by promoting series like Showtime’s Dexter and USA Network’s Monk to prime time slots during the strike. Now they should consider a more serious and nuanced development plan.

Internet channels are crying out for content, for one thing. A series could be tested on iTunes, Joost, YouTube or a myriad of other places online. Three or four pilot episodes might be enough to pull together enough of an audience to justify a season-long run on a basic cable station. Then if the audience grows (in size and in passion) the series could make the jump to a broadcast network. This would also give each series a backstory – something for new fans to explore.

The writers’ strike has given television networks an unprecedented opportunity to change their business model. It would be a shame to waste it.

Issue: A surprising choice in the Democratic primaries
Commentary by: David Vinjamuri

Political campaigns are usually the stuff of brand managers’ nightmares. The advertising is coarse, unsubtle and unconvincing. It argues with consumers. The media plans are absurd, bombarding consumers with spots so many times that they are as likely to revolt as be convinced.

In this year’s Democratic primary, however, a strange thing is happening: the candidates have constructed two very clear brand paradigms.

While the window dressing of the campaigns may have you believe that the campaign is about experience vs. youth (for Clinton) or change versus the status quo (for Obama), decoding the brand paradigms suggest that the real struggle is even older and more familiar for brand strategists.

It turns out that this primary is really about management versus leadership.

Why do we say this? Decoding the language Sen. Clinton uses to speak about her candidacy and the language of her advertising yields a classic trove of pro-management imagery. Clinton values experience, understands the mechanisms of power, knows the people who actually get things done. She promises to be ‘hands on,’ surrounds herself with party elders and speaks of herself as the safe choice. She unfailingly uses the first person “I” when speaking about her campaign – indicating she will take personal responsibility for the results and values accountability highly.

Sen. Obama speaks of the urgent need for political transformation and uses the language of movements rather than management. He suggests that creating a post-partisan administration and transcending “blue versus red state” mentalities is more important even than specific policy objectives. In spite of repeated attacks from his opposition, he continues to speak more about opportunity and to use his media to motivate rather than to specify. Sen. Obama rarely uses “I” and almost always uses the second person “we” to speak of his campaign as a movement.

This makes for a surprisingly substantive choice for voters. It’s not just flash and posturing – the two candidates are presenting two real alternatives to the question of how executive power is wielded. And they are using classic brand paradigms to do it.

Senator Clinton presents a rational argument for competent management being the most important quality for the next leader. She points to this as the greatest weakness in the current administration (failure to plan for the occupation of Iraq, poor follow-through in Afghanistan, mismanagement of disaster relief after Katrina, etc.). She suggests that only a great manager will be able to deal with the war on terrorism and work health care reform through Congress.

Senator Obama tells us that leadership rather than management will be necessary characteristic of the next President. While bad management may have gotten us mired in Iraq, only leadership will extract us. Rather than a President who can move the levers of power he suggests that we need a President who can inspire others to make fundamental changes.

These competing brand paradigms give us a stark, pragmatic choice. In Senator Clinton’s vision, the best way to avoid a terrorist plot being hatched in Munich, but bound for the United States is to have a President who can get the FBI and CIA to share intelligence, work smoothly with the German government and one who has put the right capabilities into place to stop the plot once uncovered.

Senator Obama suggests that changing the underlying mistrust of the United States in the eyes of foreign nationals (through visionary leadership) would more effectively foil the same plot by making the German Police more likely to trust their U.S. counterparts and share intelligence and also make ordinary citizens of both countries less fearful to cooperate if they were themselves Muslim.

These are two valid arguments and both need to be considered. And – although politics is not the usual place to find it – a good example of successful brand positioning.

Brand: Coca-Cola (The Coca-Cola Company)
Execution: TV (1 and 2)
Target: Soft Drinkers
Rating: *****
Reviewer: David Vinjamuri

Description:
Two Super Bowl spots for Coca-Cola, both of which broke for Super Bowl XLII. The first spot features Democrat Jim Carville and former Republican Senate Majority Leader Bill Frist arguing on a talk show. They say the word “wrong” at the same time and Frist says, “jinx – buy me a Coke!” “Right now?” Carville asks and Frist says, “No talkin’ – jinx rules!” The two leave the show and walk outside to a hot dog cart where Carville buys Cokes. Frist sees a tour bus and says, “How ’bout it?” “Why not,” Carville shrugs and the two take a tour of Washington, D.C. where they rediscover their love of America (even riding on Segway scooters at one point). The spot ends with them having another Coke while sitting on the steps of the Lincoln Memorial, looking at the sun setting over the reflecting pool and Washington Monument.

The second spot starts with a tranquil aerial view of Central Park in New York City. Three floats for the Macy’s Thanksgiving Day Parade, Stewie (from The Family Guy), Underdog and a Coca-Cola Bottle (which we don’t recall seeing in the most recent parade) are being handled by their teams. Then a gust of wind takes the Coca-Cola bottle aloft and Stewie and Underdog immediately begin to fight for it. The battle continues over the streets and sidewalks of Manhattan until, unexpectedly, Charlie Brown catches the bottle over Central Park.

What Works:
The New York Giants may be going home with the rings, but from the brand manager’s perspective it looks like Coca-Cola won the Super Bowl. Although perennial favorite Budweiser won fan polls in such forums as Adbowl, Coca-Cola scored more points from a brand equity standpoint by surprising viewers with two strong messages about the brand – each of which place the brand itself (and not secondary brand equity props like the Budweiser Clydsdales) as the hero of the spot. In fact, the spots mark a remarkable turnaround year for Coca-Cola which has taken itself from the depths of advertising irrelevance (perhaps epitomized by the failed remake of the iconic 70′s spot “Hilltop” called “Chilltop” as an introduction for Coke Zero – an effort so profoundly bad that an online version cannot be found) to a fresh rediscovery of the brand in the hands of Wieden & Kennedy.

Coca-Cola as a brand is most successful when it used as a social catalyst – the profoundly unique element that brings people together. Even though Stewie and Underdog are fighting for a single bottle in the “It’s Mine” spot, the real story is all of the New Yorkers watching the proceedings in wonder, remembering their first trip to the Thanksgiving Day parade. On a small island, events can unite people quickly. Such is the message of this Coke spot. The Frist/Carville spot is expertly timed – coming as it does just a few days before the socalled “Typhoon Tuesday” when nearly one-half of the U.S. electorate goes to vote in primary elections. Speaking as it does of transcendent values that overwhelm partisan issues, it aligns Coke with an important cultural moment.

Taken together, these spots remind us of the profound impact of an iconic brand, one that has been easy to forget for more than a decade.

What Doesn’t:
The Atlanta beverage giant’s future fortunes may hinge more on water and non-carbonated drinks (as evidenced by the recent acquisition of the Vitamin Water brand) but Coca-Cola needs to remember that the equity of all of its brands is enhance by the goodwill that the Coca-Cola name generates. Other than a few noble efforts by Wieden & Kennedy (and Psyop who collaborated on the magical “Happiness Factory” campaign” ), Coca-Cola has significantly under-invested in a brand that drives much of its brand equity as well as employee and distributor morale.

Branding Bottom Line:
Squint and you’d think Coke just aired an Obama commercial and an outtake from Cloverfield. But it’s still a home run.