Brands are not things; rather brands are a representation of a highly valued idea that resides in the minds of customers and stakeholders. A brand strategy’s success or failure depends on how well brand owners understand how the mind operates.

Brands represent a set of unifying principles that guide an organization’s behavior and its manner of delivering experiences customers highly value above the available alternatives in the marketplace. Strong healthy brands maintain an intrinsic value to customers that over time translates into tangible financial value for the brand’s owners.

Consumers care about what a brand represents to them on the highest emotional level. The physical properties and functional benefits that comprise and define a brand are of less importance–this explains the difference between Coke and Pepsi, Chevy and Toyota, Apple and the rest of its competitors.

Sounds simple enough. The trouble is consumer’s minds are fickle. And worse, the marketplace is a slush pile of competing brands. It’s easy for brands to lose relevance with customers quickly – especially in our age of instant connections, abundant choice and consumption. Brands with the sticking power to drive purchase behaviors over decades consistently lead their tribe of loyal advocates forward through a compelling value proposition and positioning that transcends the consumer’s inherent and natural tendencies toward fickleness for the next greatest thing.

A brand strategy’s success or failure depends on how well brand owners understand how the mind operates.

Minds have limited capacity.
The mind rejects any information that does not compute. It accepts only new information that matches its current state of mind. The mind has no room for what is new and different unless it is related to the familiar.

Minds resist confusion.
People resist that which is confusing, and cherish that which is simple. People want to push a button and watch the thing work. People love simple.

Minds are insecure and emotional.
Minds are emotional, not rational. People buy things for emotional reasons. When people are uncertain, they often look to others (influencers) to help them make the right decision about how to act.  People don’t like being out of the loop.

Minds don’t change often.
We are more impressed by what we already know (or buy) than by what’s “new.” Once  a mind has formed a habit it’s very difficult to change.

Minds have difficulty staying focused.
The more variations you attach to a brand, the more the mind will lose focus. The more the brand loses focus, the more vulnerable it becomes. In toilet tissue, corn oil, or toothpaste, the specialist or the well-focused competitor is always the winner.

Strong brands need to be exceptional at one thing than good at many things. Strong brands represent a single, simple, ownable, credible, highly valued and differentiated position in the minds of the target audience segment the brand serves.

Business leaders lean on terminology like “design thinking” to define and quantify the process for innovation. It doesn’t matter what you call the process, what we all desire is more creativity in the process. Creativity is elusive.

Most of us don’t understand creativity, but all of us appreciate it. Marketers spend all their energy seeking creative solutions to the challenge of building enduring and successful brands.  Creating innovative products and brands people can’t get enough of is an elusive reality for many businesses–yet innovation happens everyday all over the world.

Knowing that innovation is happening everywhere, and not wanting to be left behind, most enterprises want to be really good at innovation if they are to create competitive advantage in the marketplace. This is where the organizational discipline of “design thinking” comes in play. It’s a trendy term that implies a higher value method for delivering creativity and innovation.  It’s jargon.

Innovation is radical not incremental.

Radical innovation is what happens when something unexpected shows up, and it just happens to be something people where waiting for– just not asking for– like Facebook, the Swiffer, and an iPad. Every one of these innovations was not based on user needs. Radical innovation is not about function and form, but about meaning– never driven by users.

So what then is the basis for creativity within the innovation process? The answer is simple– a creative mind with the passionate desire to pursue an un-proven and perhaps un-needed idea at just the right time.

Most enterprises aren’t set up for investing and pursuing un-proven and un-needed ideas. They’re organized around risk-averse quantifiable disciplines to make profit and return value to the owners of capital invested. Managing process requires linear thinking creativity does not.

Creativity requires the right dirt.

Like life, creativity within organizations requires the presence of specific elements and in precise quantities. We all want more creativity. For creativity (and innovation) to thrive in organizations, the dirt has to be right.  If it’s not right, then innovations coming out of the enterprise will most likely be incremental – one feature or benefit better than what the other guys are doing at a cheaper price.  Flat-screen TVs come quickly to mind.

In our me-too cluttered marketplace, incremental innovation is not enough to drive much change in behavior or demand.  Nor will it propose new meanings and context that’s highly valued by the marketplace. Building the ecosystems within organizations that spawn greater creativity and innovation is not something every organization will be good at. That’s why so many business leaders and consutancies embraced the idea of design thinking.  It’s a way of making creativity within organizations a linear process.  Business leaders love linear process and efficiency.

Jargon may make designers sound smarter, but it doesn’t enhance their creativity. Nor will it provide market leading innovation.

More creativity within organizations requires the dirt be comprised of:

• an engaged and passionate leadership with a big vision of change
• the vision and purpose is shared amongst all stakeholders
• a healthy shared acceptance of risk playing out on the edges of what’s possible
• talented and highly skilled people who share the vision and pursuit as their own
• money
• time

Take any of these essential elements away, or have them not be in the proper quantities and you can call the innovation process anything you like, but it doesn’t make creativity a force alive within your organization.

All people are creative.

Creativity is the unique expression of our most basic human nature. Everything that ever was, is now, or will ever be, is at first, a formless idea swirling in the goo of creativity inside someone’s head. There is no special club one has to be a member of to express their innate creativity. Both right and left brains are welcome and necessary.

What’s awesome about creativity is it’s such an inclusive thing. Everyone likes creativity because everyone believes they’re creative. And the good news is they’re right!

The behaviors necessary for people to be creative don’t require special knowledge– just empathy and awarenss of human needs and being sensitive to the people and culture you’re immersed in.

From that experience, people will creatively develop the specific knowledge and wisdom to frame up the problem and develop the organic ability to create and enact the right solutions. I suppose you could call that design thinking if it makes you feel better. Call it whatever you want. At the end of the day, the desired element is creativity.

Not all organizations are creative.

There are plenty of creative people designing away inside business organizations that are not driven by creativity or innovative. Every organization can’t be Apple even though they possess all the components that make Apple-type companies possible. This is what makes organizational creativity so elusive. Consequently academia (those that teach but cannot do) tries to provide the doers with fancy terms and quantifiable thinking models to make creativity and problem solving something more predictable and dependable. Seemingly, the more organizations try to mandate creativity as a core competency, the less creative and innovative they are. It’s a bit like dancing with your shoe laces tied together.

Creativity is a phenomenon not a process. Design is process, engineering is a process, and marketing is a process. CEOs who value a culture of strict process usually lead enterprises devoid of the creativity that drives radical innovations that change the world for all us.

Creativity doesn’t require terminology to help people be more creative or organizations more innovative.

In another era, a big part of my creative work as a writer and designer was in corporate and investor related communications. Every year my office produced a dozen or more printed annual reports.

Of course nowadays, you’ll find Annual Reports as pdf downloads on corporate websites. Not the lavish productions that were common back in 80’s and 90’s when my office was creating them. Designing corporate annual reports was an amazing process back then. When I speak to design students about the process, many look at me with blank stares on their faces. “You mean you didn’t use photoshop” they ask. That always makes me smile.

The printed annual report is indeed ancient history. In a recent conversation with a former colleague, we were fondly reminiscing about all the care, craftsmanship and money that went into producing this important annual communication extravaganza. We were marveling at the development process working with the company CEO, the storytelling, the design, the art and photography, not to mention the middle of the night press checks with our blurry eyed clients. Seems rather romantic looking back.

I once had four different annual report press checks going on at the same time at the same printer. Those were the days. Sometimes I miss the energy and the smell of ink standing at the end of a giant press with loop in hand.

Alas annual reports are not completely dead in print form, many companies still actively publish and distribute their annual reports in printed form.  For the life of me, in our digital age, I can’t imagine why? So I went back into the archives to share some of the lost annual report work I am still proud of. These examples are all from the mid 80s. Trouble is I can remember all the client companies and the specific year of publication.

With 120 Sears and Kmart stores about to be shuttered, the future looks uncertain for yet another iconic US retail brand. Here’s our view on what it might take for Sears Holdings to create a brighter future.

It’s an understatement to say the retail environment has become a slush pile in the past decade. Once a dominant presence in every major mall across the US, Sears is now a relic from the past struggling to find its way in a culture that no longer seems to care.

Same goes for Kmart– these iconic and once beloved brands (like Kodak) appear beyond transforming themselves into something that people will love again.

I remember growing up in the 60’s and shopping at Sears and Kmart with my Mother. She loved shopping in both those stores. Dad too. It seemed to me both these brands represented the idea that the good life was accessible to just about everyone everywhere. My family was no exception. My parents made all their major purchases at a Sears or Kmart store. They wouldn’t consider alternatives.  I grew up with a deep belief that these stores were somehow sacred places for a thriving middle class living the American dream.

Times change, Sears and Kmart didn’t.

Now executives at Sears Holdings find themselves in a scramble to figure out what to do with these brands that have become dinosaurs from a lost world–relics from a time when things were simple and uncomplicated.

Retail knowledge and expertise is not the core problem for Sears– it’s the investment banker management culture that has over time sucked the value out of these brands.

Profit has been placed above serving people with experiences they care about. As I have written in previous posts, iconic brands begin to die long before the cash they generate dries up.

Of course, there are many highly skilled and experienced people within the Sears organization that know the retail business inside and out, with far more depth than I will ever know in a hundred lifetimes. It’s time for the folks at Sears Holdings to transform the brand into something worthy of its heritage and a brighter future.

Sears’ brighter future is in the parts not the whole.

Despite tired merchandising and dingy looking stores, Sears store brands are a shining pot of gold that can pave the way forward to a brighter future. Craftsman, DieHard, Kenmore and Lands End are all highly valued brands that still matter to consumers. Trouble is, one has to go into a crappy Sears stores to buy them.

Maybe a tough decision could be made to sell these coveted brands through other retail channels. According to a recent post on Store Brand Decisions, that may already be happening as there is speculation the retailer may be getting serious about new channel strategies for its legacy hardline private label brands.

According to the post, Sears has made moves to expand its store brands beyond its own stores. Sears recently struck deals to sell Craftsman tools at Costco stores and is expanding this program to include Ace Hardware stores. This past September, Sears announced plans to sell its DieHard Gold auto batteries at Meijer discount stores. However, there have been no announcements about selling Kenmore appliances at other retailers, but there’s plenty of speculation.

That seems like selling off the “seeds” of their brighter future. Indeed it’s a logical short-term strategy for revenue and keeping the stock price up, but these coveted store brands own all the cache! When you can buy them somewhere else, who needs Sears?

Seems to me, reinventing the Sears experience by leveraging the valuable equity in these private brands through more effective and creative merchandising in smaller retail footprints and online is the smarter move. Get rid of everything else–including Kmart. Who needs a Kmart today when Target, Wal-Mart and a host of other discount retailers have that space covered in spades.

Create experiences people love.

The entire Sears customer experience must be purposefully reinvented and designed.  This is what IKEA accomplished. Despite the fact that people hate shopping for furniture, IKEA reinvented the entire furniture shopping experience–and did it in a manner that’s contrary to the conventional wisdom about furniture retailing.

Unlike most furniture retailers, IKEA does not deliver, and you have to set-up your stuff once you cart it home. And despite all this hassle, people love IKEA. It is one of the most beloved retail brands. People don’t buy furniture at IKEA they buy into an idea, an ethos, a certain way of living.

Sears could learn a thing or two about the value of designed experiences to differentiate itself from other big box competitors. To do this will require a tremendous culture shift within the ranks of executive management.  To people concerned more about short-term profits, it’s far easier to close down non-performing stores than create ones people love to shop in.

Leverage the iconic Sears mail-order heritage into a richer digital experience.

Back in the day when people cared about Sears, they also loved the Sears Catalog. Sears invented the mail order catalog. With online retailing now common, Sears seemingly missed the boat translating their iconic catalog into a rich online experience consumers crave today.

On the current site, there are over two dozen product categories offered with thousands of items. You can buy everything imaginable. Why?  Why not focus the Sears online shopping experience around the valuable and much loved store brands. Leave everything else to Amazon who does a much better job.

Online, Sears is a me-too generic site. If people don’t shop in your brick and mortar stores that represent an experience they love, why would they shop online in the face of other more capable alternatives?  If you visit the site, there is no visual merchandising of the beloved trade names, only generic descriptors like “refrigerator” or “washers and dryers”. You have to really dive deep to find the brand name Kenmore. In the desire to sell everything under the sun, Sears no longer means anything to anybody.  In the online world, Sears should leverage its mail order heritage and be the exception not the rule.

Focus and the art of sacrifice.

The toughest thing for an iconic brand to do is focus and sacrifice. To thrive, Sears must do both. Sears needs to focus on a compelling positioning that sacrifices a “be all things to all people” business with gigantic scale, and transform itself into a business that offers a highly relevant value proposition narrowly targeted to select high value customers.

Less is more. Put the marketing and merchandising focus on the much loved store brands. Get rid of all the other the soft lines. Retire or sell the Kmart brand.  Design a compelling retail experience in smaller footprint stores. Reinvent the online experience. Target higher value customers.

Can they pull it off? Time will tell.

In many business organizations, there is still much confusion about the role of strategic brand development and brand management and who within the organization should lead it. Brand strategy and brand management is too important to be left to marketing people.

That’s my spin on the famous David Packard quote (as in Hewlett Packard) about marketing being too important an activity to the well-being of a business enterprise to be left in the hands of marketing people alone.

Business leaders have notoriously looked at marketing with a critical eye. Marketing is not a “hard discipline” like engineering, sales and finance. Business leaders love quantified activities that facilitate a predictable return. Marketing doesn’t provide predictable returns. And in today’s social media, permission and privacy driven world, marketing is even more suspect by consumers. Customers want real, authentic connections and engagement to brands, not more marketing and selling.

Brand strategy and brand management is not a sub-discipline of marketing.

As brand strategy and brand management becomes more essential for marketplace success, enlightened business leaders have moved it further away (and upstream) from the core competencies within marketing organizations.

Yet for many organizations, brand strategy and brand management is an activity mostly managed within the marketing discipline. Consequently everybody in the marketing profession does “branding” these days. Branding gets bundled into a plethora of tactical marketing activities like PR, advertising, social media, sales promotion, packaging and marketing communications. Brand strategy and brand management is not marketing, advertising or communications.

This by no means diminishes the essential role of marketing for creating awareness and demand. Brand strategy and brand management is not about creating awareness, it’s about guiding the quality and relevance of organizational behavior in serving a specific group of customers/consumers. It’s a more sacred and strategic process defining the who, the what, and why an organization or a product exists in the first place – beyond money making. Brand strategy and brand management is about the soul of the thing–the intangible, the unseen, the meaning rather than the physical.

Brands make promises to people. Break the sacred promise and no amount of clever marketing will rebuild lost trust. Just ask Netflix or Tropicana what can happen to your business when the bonds of trust breaks. The value of brands lies in the perception customers have in their minds about what makes a brand matter to them. To matter nowadays, requires brands build deeply rooted emotional connections and never fail to deliver on the promise.

The discipline of brand strategy and brand management is centered in creating a set of unchanging, universal principles that guides the behavior of organizations and the products they bring to the marketplace over the life of the enterprise. It’s not about informing the next advertising campaign.

Brand strategy and brand management is a top down discipline.

The principles that guide the strategy and management of a brand have to be driven by the leadership of the organization. Brand leadership begins with business leadership.

Business strategy informs brand strategy which, in turn, informs marketing tactics.

When marketing organizations (or worse their advertising agencies) attempt to define and lead brand strategy, it becomes more marketing. Consumers / customers loathe marketing. Marketing now gets in the way of real engagement with a brand. Marketing needs to be baked into brand strategy, not the other way around.

Business leaders must drive brand strategy. Leaders determine the higher purpose, vision and values of the business enterprise, not their marketing organizations. Consequently, when leaders have clarity on “why” their brand exists, it’s much easier and more effective to weave the elements of brand strategy into the fabric of the organizational culture and guide the behavior of the organization at every customer touch point in the value chain.

Brand strategy and brand management is internal, marketing is external.

Brand strategy informs everyone within the organization why they exist and matter to people, what values they share, what markets they serve, what products they innovate and bring to market, what processes they use, and what experiences they are to create for customers and the community at large. Without this solid foundation firmly established, marketing organizations (and their agency partners) have nothing to go on – no map, no guidance, and no discipline – an aimless ship adrift without a rudder.

Brand strategy and brand management is the rudder that steers the ship.

To our clients, colleagues and friends, on behalf of PULL Brand Innovation, we wish you a joyous Holiday Season and much prosperity and success in the coming New Year!

Let’s pay respects to Eastman Kodak which appears to be rapidly fading into black, the victim of it’s own arrogance and the forces of creative destruction raging in our digital age.

As I write this post, I can’t help singing the lyrics of Paul Simon’s 1973 iconic tune: “Kodachrome gives us our life’s bright colors, give us the greens of summer, make us feel all the world’s a brighter day”.

Once the bluest of blue chip brands, Kodak is eminently about to enter some form of bankruptcy protection and reorganization. Of course, no surprise there, but as the Holiday Season draws near, I am nostalgically reminded of Kodak’s “open-me-first” dominance of the season and all the special “Kodak moments” throughout the year that were the foundation of its dominant position in our culture for over a century.

This is a dramatic ending to an iconic and beloved brand that was once as globally recognized as Coca-Cola.

With it’s stock price hovering around a buck, $800 million in cash on hand, and a monthly burn rate of $70 million, it’ll take less than a year for Kodak (like Polaroid) to become a history lesson for marketing MBA’s to ponder in business schools. Kodak is now frantically trying to stay afloat by selling its intellectual property. Buggy whips anyone?

The irony of the digital age.
Some people may not be aware that in 1975 Kodak engineers invented the digital camera. But like many innovations, the idea was not deemed particular useful by the management of a company deeply cemented into it’s dominant chemistry based film business.  The irony is palpable for sure–made worse by the arrogance of Kodak’s executive management over the years.

The last spool of Kodachrome film rolled out of a Mexican factory in 2009. With instant point and shoot digital photography on cheap cell phone cameras, even consumer-grade digital cameras are quickly becoming relics. Worse, only a tiny fraction of consumer images taken on cell phones or digital cameras gets printed to paper. Who needs printed pictures when people share digital photos on social media networks?

New economic models and global competition have destroyed other giant companies, but digital technology has been a destructive firestorm making every aspect of Kodak’s business completely irrelevant. I can think of no better example of Austrian economist Joseph Schumpeter’s “creative destruction” principle at work.

The arrogance of success.
Kodak is a lesson to any CEO in an industry dominant company– things change, nothing lasts forever. (This goes for the likes of Apple, Google and Facebook). Almost from it’s founding in 1890, the money came rolling in decade after decade fueled by the razor-blade strategy of selling cheap cameras and reaping lavish profit margins through consumables of film, chemistry and paper.

By the mid-70’s Kodak owned nearly 90 percent of the film and camera market. With this level of dominance, you can just imagine what kind of executive culture was brewing in the Petri dish of marketplace success. Arrogance and complacency are often the by-products of an unassailable competitive position, and Kodak has been no exception.

When Fuji Film entered the US market, Kodak executives refused to believe that Americans would embrace a foreigner over the sacred brand. Big mistake. Rebuffing its chance to become the official film of the 1984 Olympics in Los Angeles, Fuji brilliantly exploited the opportunity and achieved a permanent hold in the US market, significantly eroding Kodak’s share.

Then came the digital age. Although Kodak had embraced many me-too digital features in its products by the mid-80’s, it’s executives could not fathom a future where film would have no role whatsoever in image capture. Nor could they manage their bloated business, pension obligations and executive compensation on the low profit margins and competitive pace of a marketplace overflowing with short product cycle technologies.

The Kodak Moment has passed.
Every brand has a lifespan– a beginning, middle and an end.  That said, companies can remake themselves on a scale now confronting Kodak. IBM did it. GM is on that road now. It can be done.  Alas, we may be witnessing the last Kodak Moment right now.

True enough, it could be argued it’s premature to write off the Kodak brand. Kodak has a century of consumer marketing expertise and a viable technology portfolio to leverage. However, without visionary leadership at this critical time, Kodak may be forced to sell the remaining seeds of its potentially brighter future and fade into black.