Larry Light: Facebook Is Breaking The Five Basic Principles Of Trust Building

From Larry Light’s latest piece in Forbes.com:

We are watching the real time demise of the trust in the Facebook brand. Facebook is in a battle to save the trust in its brand. Lose trust and nothing else matters. Although it would seem to be counterintuitive, it does look as if Facebook is doing everything conceivable to destroy its brand trust. Facebook is making trust busting look easy.

Read the rest of his piece here.

COCA-COLA’S STRATEGIC DEXTERITY

Right before Labor Day, Coca-Cola purchased Costa Coffee. If you have been to the UK, other parts of Europe, or Asia, you will understand that Costa Coffee is the second-largest coffee shop chain in the world, just behind Starbucks. In the UK, Costa has 2,500 stores. The brand has 3,800 stores in 32 countries.

This purchase is yet another segue away from a cola-uber-alles approach to a beverage strategy that better reflects people’s changing tastes. According to Barron’s, Coca-Cola’s sales declined every year since 2012, while coffee in all of its forms, is still strong. Coca-Cola is recognizing that continuing to focus on what worked in the past is not necessarily a winning strategy for today.

Coca-Cola ceded coffee primacy to others such as 1) Nestlé (owner of Nescafé) that cemented a deal with Starbucks to sell the brand’s teas and coffee drinks globally, and bought the boutique brand Blue Bottle and 2) JAB, a European holding company, owns Peet’s Coffee, Stumptown, and Keurig Green Mountain. From a brand-business standpoint, Coca-Cola is working to reverse behaviors that are strategically insensitive. Strategic insensitivity is a result of failing to pay attention to changing customer needs, problems, beliefs, and values.

There are legitimate concerns that Coca-Cola is not capable of managing actual brick-and-mortar stores. The firm’s strengths are elsewhere. Additionally, there are concerns that buying Costa gives Coca-Cola a lot of global real estate, an area in which Coca-Cola has not played.

These arguments overlook all the experience Coca-Cola will receive through its purchase of Costa. Costa knows a great deal about how to run coffee shops. Unless Coca-Cola decides to dismiss a raft of Costa executives, these concerns are slightly misplaced. It is true, that actually owning and running coffee shops is not something Coca-Cola is known for, however, there are few brands that work with restaurants better than Coca-Cola. When Coca-Cola works with big customers such as McDonald’s, a team is embedded in the McDonald’s offices. The team knows what is going on with customers, with customers’ needs, and most specifically, the team is on top of the logistical and service requirements needed at all the McDonald’s restaurants.

Coca-Cola, whatever its problems, is showing that even big, embattled behemoth brands can exhibit strategic agility. Coca-Cola is revealing that it is open to and able to evolve when disruptions happen or business, environmental, political, geographic circumstances alter the landscape. Coca-Cola is fighting against the arrogance of success by expanding its horizons into more popular beverage areas. By changing its perspective on the beverage landscape, Coca-Cola is leading with strategic dexterity, being resolute and responsive, disciplined and dexterous, at the same time.

Even though investors are on the fence, unconvinced that Coca-Cola is making the right move with this expensive acquisition, one investor group executive told Barron’s the following, “I continue to remain Neutral on Coke, but I like when companies continue to diversify their core businesses, and this is another turn in the company’s long history. The Costa acquisition is a bold move by Coke as it continues to expand outside of its core beverage business and increase its retail presence.”

“Building The GE Brand Can Help Save The GE Business” Says Larry Light in Forbes.com

“GE is a troubled company. Its financial performance has been dismal. GE is struggling to restore confidence on Wall Street. The GE brand has a valuable heritage. The touchstone of the GE brand is its historic promise of innovation for better living. This is not about going backwards. It is not about reproducing the past. It is about clarifying and re-energizing the GE brand’s heritage in a contemporary, compelling manner.”

Read the rest of Larry Light’s latest piece in Forbes CMO Network!

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Photo Credit: Momoneymoproblemz

Larry Light Explains “Why Avis And Enterprise Are Beating Car Dealerships To The Future” In Forbes.com

“Both Enterprise and Avis have created options that address a more flexible, adaptable, variable approach to transportation.” says Arcature CEO Larry Light. Read the rest in his Forbes piece “Why Avis And Enterprise Are Beating Car Dealerships To The Future“.

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Photo Credit to Drums600

Larry Light Points Out “Why Your Favorite Healthy Snack May Not Be Healthy?” In Forbes.com

As the FDA is nearly about to address food and beverage labeling this coming summer, how brands can use the term “healthy” may be redefined. Read Larry’s latest Forbes piece to learn Why Your Favorite Healthy Snack May Not Be Healthy?

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Photo Credit Mike Mozart under CC License

Larry Light Discusses The Boeing 737 Max Brand in Forbes.com

In his latest Forbes piece, Larry light asks the question “Can the Boeing 737 Max brand reputation be repaired?”.

Read his thoughts here: Can The Boeing 737 Max Brand Reputation Be Repaired?

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Photo Credit: pjs2005 from Hampshire, UK

Read Larry Light’s Latest Forbes.com Piece: Is The Mass Middle Of The Market A Marketing Death Trap?

Is the mass middle of the market a marketing death trap or is it a marketing opportunity?

Arcature CEO Larry Light explains in his latest piece featured in Forbes.com.

Read it now: Is The Mass Middle Of The Market A Marketing Death Trap?

NEW RULE FOR BRAND ORGANIZATIONS

The phrase “Be a runway, not a control tower” popped up a few of years ago in a Singapore newspaper. The phrase is a great way to put a frequent brand organization occurrence: the resistance to change.

For brands to be successful in the ongoing challenge to remain contemporary, the idea is not to oppose change but to drive it.  Change happens all the time. Today it is almost impossible to keep aware of everything that changes around your brand. The digital advertising business has to deal with technologies, devices, and apps that change so much faster than people adopt and adapt.

Yet, opposition to change happens. Employees may fear how change will alter their jobs. They may think that what has been the current methods of operation should continue to be the standard operating procedure. Or, they are very happy and complacent and see no need to change.

Change initiatives usually come with a detailed program, an HR course, a set of slides, a video, a script, an app, a dictionary, a metric (or series of metrics), out of-office seminars, and in many cases a slew of young, junior consultants who take up a lot of office space. For many brands with change in leadership there is also a change initiative: new person, new ideas.

A brand’s culture sometimes can be the control tower keeping everyone on course, and focusing on avoiding any and all risk. Brands flourish in supportive organizational cultures. If the organization is risk averse or closed to change, it creates an inflexible and relevancy-resistant environment.

Brands must stay relevant. This requires change. Continuing to do the same old things when the world is dynamic is a formula for failure. The biggest challenge that brands face is ensuring that brand teams are open to change, and that the organizational environment is conducive to change. In organizations undergoing change, for that change to be genuine and not superficial, cultural change initiatives must be consistently reinforced, widely communicated, supported from the top of the organization, and realistic for the organization’s current situation.

Brands are dynamic, active promises about what they will do for the customer. Brands do not do well where the control tower effect is in place. Brands need continuous renewal. Brand teams must be aware and alert to marketplace changes and anticipatory ideas for satisfying customer needs. With too much control tower, without the continuous renewal of innovation or renovation, a brand will stagnate. The business will stagnate. Enduring profitable growth requires building a continuous renewal cycle.

When there is a misalignment and conflict between the brand strategy and the brand culture, the culture prevails over the strategy. Culture always wins. Brands need supportive, flexible cultures. If the culture is inactive and risk averse, in other words, a control tower closed to change, the misalignment is serious.

Brands need the runway. But, this does not mean there are no brand boundaries. Every runway is a well-defined pathway. Skidding off the runway is no good. Taxiing outside the boundaries of the runway is dangerous. Staying within the lane but being able to have change take flight is in a brand’s best interests.

 

LARRY LIGHT BECOMES FORBES CMO NETWORK CONTRIBUTOR

Arcature CEO Larry Light has been tapped as the latest Forbes.com Contributor within their exclusive CMO Network.

From his Forbes Contributor Bio:

My focus is building brands as the basis for enduring profitable business growth. I have won a variety of marketing awards. In its report on Best Marketers of the Decade, AdWeek reported that “Larry Light, who turned around McDonald’s as CMO from 2002 to 2005 finished second to Steve Jobs.” In summarizing the top ten ideas of the decade, Ad Age selected “Brand Journalism,” “introduced by Larry Light as arguably the most realistic description of marketing today — perhaps ever.” And, I was the first Chairman of the Coalition for Brand Equity – a group founded by advertisers, agencies, and media. I authored articles accepted in peer-reviewed professional journals and other well-known publications such as the Journal of Brand Strategy, Journal of Advertising Research, Harvard Business Review. Along with Joan Kiddon, I have published four books on marketing, brand management and organization for brand-centricity. Two of the books are focused on the successful turnaround of failing brands.

Read his first piece in Forbes.com, Financial Engineering Damages Brands.

LEARN FROM THE MISTAKES OF OTHERS

Almost 30 years ago, Peter Senge, a systems scientist and lecturer at MIT’s business school, developed the concept of the learning organization. This idea became a big wave in organizational development and thinking. Basically, a learning organization is a company that enables the learning of its members while continuously transforming.

According to Mr. Senge and his peers, a learning organization develops because of the pressured business landscape and helps keep businesses competitive. Others, such as Harvard’s business theorist, Chris Argyris, saw learning as being keenly aware of what competitors are doing; recognizing and keeping abreast of changes and innovations in the marketplace; and, then responding with creative solutions.

When people think of learning, they often focus only on learning only from successes. Some marketers call this the “transfer of proven success.” Others refer to it as “copying with pride.” But, it is just as important to learn from mistakes. Learn from your own mistakes and learn from the mistakes of others. Learn from your close competitors’ mistakes.

Last winter, Automotive News, the auto trade press bible, reported that Lincoln would be changing its model names from letters to names. Owners and customers were confused as to which brand was which. Its brands were named MKS, MKZ, MKT, MKC, and so forth. The head of marketing, sales, and service said, “There’s a lot of challenge associated with the letters and putting those together.”

Luxury car brands tend to use letters or alphanumeric combinations.  The more mass-market vehicles tend to use names. So, for example, Toyota uses names while Lexus uses alphanumeric branding.

However, it was not just the letter names that put Lincoln in the hot seat. The vehicles were not differentiated enough to make the labels meaningful. Mercedes and BMW have highly differentiated models that are segmented by class (C-class, S- Class) for Mercedes, and series for BMW (3 series, 7 series).

Cadillac introduced a cavalcade of products. They have not learned from the mistakes of Lincoln. Cadillac had a model called ATS (a compact sedan), which was supposed to be the “BMW fighter.” It is being replaced by the CT5. Cadillac’s CTS will also be discontinued and replaced by a midsize sedan also under the CT5 nameplate. There will be the CT4, a small vehicle like a BMW 2 series. A CT6, also a sedan, will be differentiated by GM’s Super Cruise hands-free driving system. There will be the XTS, a large sedan. And, there will be the XT4, a compact cross-over, and a larger model the XT5, as well as a three-row crossover, the XT6. Is all this clear to you? The only named brand is the Escalade, which, by the way, is the only brand that actually makes money for Cadillac.

If you go on the Cadillac website, the coupes and sedans with the alphanumeric names and similar designs are just as confusing as the Lincoln models. The engines differentiate many Cadillac models. But, when parked in a lot, no one sees the engine; people see the vehicles. Striving to be a luxury brand is about more than labels and names. It is about meaningful differentiation. Mercedes, Audi, BMW, Lexus are successful not because of how they label their vehicles but by the relevant, differentiated experiences they promise and deliver.

It remains to be seen if the influx of new Cadillac models will raise the luxury image of the Cadillac brand. Unless the Cadillac models are clearly differentiated, Cadillac may find that the problem Lincoln had was not a Lincoln problem. It was a brand management problem. Learning from someone else’s mistake is far better than making the same mistake on your own.