Historically, the idea of branding was contrary to the bank culture. The idea being that to brand something was to impose some artifice onto it, as opposed to the low-profile, three-button, wing-tipped, dry, trustworthy image that professional bankers enjoyed projecting. In fact, there was a time when marketing of all types was seen as unethical. Then came deregulation, and competition from both bank and non-bank competitors. Suddenly there were other places to put your money. Other places to get your loan. Suddenly, banks needed to be known…and to be differentiated.

While everyone seems to agree, at this point, that branding is necessary for a bank. It’s still tricky. Because a bank’s brand still has to be an authentic representation of the bank itself—it has to be the bank’s personality, with the bank’s vocabulary, and the bank’s own clothes (trade dress). A bank still has to be calm, low-profile, trustworthy, dependable. It just has to be branded so that those qualities SCREAM! Kidding.

A bank brand has to take into account the community it lives in. The people it serves. The history and vision of the bank. And, especially in times like these, a bank needs to be seen as humble, hard working, sound…anything but flashy. Probably, a bank brand needs to take into account the times when a bank should be invisible.

In the past two decades, we’ve seen some bank branding that has backfired in the past few months. Nobody really wants a fun bank these days. Or an opulent bank. Or a high-flying bank. People want banks that WON’T WASTE MY MONEY.

We’re excited about the opportunities for banks as the economy starts to lift a bit. I predict we’ll be seeing the role of community banks become much more important across the country. As people start to get back to business, will they want to be in business with Wall Street…or Bank of America? Or will they want to do business with Andy, John, Cindy, Dean, Shields, Diana, Mays, George…you know…people who are from here.

It’ll be fun to see what happens. Well, maybe fun is a little too strong a word. It will certainly be interesting.

I’m thinking Facebook might have a couple of problems they hadn’t counted upon.

First, the site/ap/service was created during times that were (for most people) pretty solid economically. Making the rent wasn’t a worry. Buying groceries certainly wasn’t. We were, as a culture, all up in the “self actualization” zone. So, connecting with old friends, making new friends, and hi-by drive-bys were the order of the day. But things are a little different. Not that long ago, clients started canceling projects that were not “directly revenue generating.” So, we’re back to transactions. And so is everyone else. It’s all about getting done what needs to get done to put food on the table. Does this leave time for chit-chat? If not, does this render a brand entirely built on chit-chat a little less relevant? Just a thought.

Secondly, Facebook’s demo has been inching older. When we first got into it, we were exceptional—40 somethings (at the time)—in a medium overwhelmingly dominated by 20 somethings. Well, guess what. When times are good, the baby boom will not be left out. So, Facebook has become what prime time tv used to be—25-54! Well, now that the fat demo for Facebook is the same folks who were sunami-smacked by the stock market collapse…what must this be doing to Facebook’s advertising model?

Now, the problem with being forward thinking is that you think you see stuff on the horizon that is really a piece of lint on your glasses. In other words, I’m probably wrong on this whole Facebook thing. I hope so, because — other than lame chat — I got nothin’ but love for Facebook. I don’t know. What do you think?

I mean, it sure enough is more relevant than twitter. But so are tin cans with strings. Just sayin’.

A little more than two years ago, we moved into this cool space, in which we rendered a bohemian | industrial feel. We were part of a movement, to turn Laurens Street from an alley, back into a street. The city was very excited. It was us, and a developer of high-end condos, and an ad agency down the street, and a restaurant up on the corner. We got together with the city, before we made an offer on the place, to talk about plans.

They were gonna put a police out-station at the bottom of the block (to offset some issues having to do with the bus station across the street, and transients). There was gonna be a trash compactor, to deal with the trash generated by all the new residents and the restaurants that share our alley. There was gonna be some street scape work. It was gonna be cool.

Then, about three months ago, Duke Power decided to put an eight-foot-tall, green metal transformer in the middle of our street scape. Kinda works with the industrial bohemian thing. But not so much with the live oaks planted next to it. Anyhow, MDH (the woman at the city of Greenville who is in charge of the street project) decides that we can have a mural painted on the side of the eyesore…you know, like arty cities like Austin and Portland do. We though, cool!

We suggested, why not put something to promote one of the big shows coming to The Peace Center. Generate some street level excitement. Ran it by the MDH. Her bureaucratic response:

“Good idea—the only thing is it would be considered “off-premise advertising” and would not meet our city ordinance. If we allowed the Peace Center to advertise, other people would ask to advertise on things all across the City. I think we will probably have to use artwork instead of ads. Thanks for your feedback.”

I think she (and the city) are confused, and need to get this strait in their heads.The old “if we let one person, we’ll have to let everyone” just doesn’t wash in this case. The Peace Center is not everyone. The Peace Center is a major non-profit institution, positioned as the cultural center of the region. It is a substantial driver of city revenue, as well as a significant economic development magnet. If they can advertise their silly footbridge, they can advertise the jewel in their cultural crown.

They need to be reminded that without The Peace Center for the Performing Arts, there is no WEST END.

Sorry for the rant.

When we do branding, we spend a great deal of time, and many tools, getting to understand the client’s differential advantage. Now, it’s generally pretty easy for folks to understand things like color palette, type palette, photography palette, voice, tone, music…all the sensory components of the brand. But it’s sometimes a little harder to grasp differential advantage. So, here’s what it is.

Differential advantage is the set of benefits you are able to provide profitably, every day, within your normal operation, that are relevant to the purchasing decision of a significant portion of purchasers of your category, that your competitors cannot duplicate as routinely or as profitably. In short, it is your home field advantage.

A great example (which we, sadly, did not develop) is FedEx. They built their entire business on a “hub” concept, where all packages came to, and departed from, a central hub (Memphis, I think). This unique operational feature enable them to deliver any package, from anywhere in the Continental United States, to anywhere in the Continental United States, over night. Thus the differential advantage, as tag line—when it absolutely, positively has to be there overnight.

This differential advantage was a leverage point for FedEx to own the premium niche of overnight business delivery. Although they now do a lot of other things—international delivery, ground delivery, KINKO’s—and although others now do overnight delivery, FedEx was able to leverage being first in this niche to build an entire brand on the overnight position.

We branded with a bank in Texas, who looked around and saw that there were a lot of banks in Texas, but not too many FROM Texas. Now, that may not mean much in Alabama or South Carolina. But Texans Loooooove Texas. So, we were able to build an entire differential advantage on the fact that they were from Texas, and their direct competitors weren’t. Blue bonnets are magic, you know.

We had a great time at the furniture market. Lots of cool discoveries.

A few years ago, the furniture business was changing. Consumers were very happy to buy not-so-well-made furniture, since the trend was to treat furniture as disposable. Fashion was the only driver of furniture purchases. And so, if you’re looking for a sofa in this year’s color, you buy the cheapest one, right. Rooms to Go wins. High Point looses.

So, retailers were becoming very price sensitive, and not too quality sensitive. As a result, many of the furniture plants in and around High Point cut back or shut down. The manufacturing was outsourced to Asia, where labor was cheap and quality was … okay … ah … labor was cheap so the furniture was cheap, so if the quality wasn’t quite there, it was close enough.

To add insult to injury, a major furniture show started in Las Vegas. Now, Vegas is a convention | trade show kinda town. And High Point is not. In fact, High Point is a little out of the way—like, you can’t get there from here…it isn’t on the way to anything, if you get my drift. So, it was lookin’ like High Point was about to become a part of the quaint history of the furniture industry. But…

A small industry grew up, repairing | finishing furniture made in Asia that was below spec or damaged in transit. This added cost to those cheap pieces coming over by the container load.

Then, since the better brands remained sort of picky about materials, wood had to be shipped to Asia, from which to make the furniture. This added to the expense of the “cheap” furniture.

Then, fuel prices went up, wages started climbing in Asian countries that did the manufacturing, and the dollar started dropping. Suddenly, those old boys in North Carolina, making furniture by hand, with pride and craftsmanship, started looking downright competitive.

Then, a major trend started among, of all people, upscale Asian consumers. They wanted furniture that was not just an American brand, but that was actually, demonstrably, made in the U.S.A. Once manufacturer told us that they had to create a special, over-sized “Made in U.S.A” label, specifically for their Asian customers.

Then, something happened in Las Vegas. Turns out that Vegas loves a party, whereas High Point loves furniture. So, at 6:00, the Vegas show closes, in order to get everyone out to the strip. In High Point, around 6:00, appetizers are served in preparation for dinner at many of the showrooms. Customers, reps, and designers sit down to dine at (and among) some of the finest furniture in the world. And the dinner conversation is … what else … furniture.

At the worst of the furniture downturn, one sad story was told of an entire town that was wiped out. The manufacturer closed the mill, people put their houses up for sale (but they didn’t sell), and left town to find work. Suddenly, that manufacturer is scrambling to get those workers back. As Scooby Do would say, rots-o-ruck.

Tomorrow, Anne and I have been invited to High Point, North Carolina for the fall furniture market. Our friend, and once-and-future client Eddie Merrell shot us an email a couple weeks back and asked us to come and spend the day, as his guests. I’m really looking forward to it. If you’ve never had the opportunity to go to one of these markets, let me tell you about it.

This, along with the spring market, has been the cornerstone of the American furniture industry for decades. The industry has been driven by designers and craftsmen for most of its history. The way it has always worked is this. Designers for every furniture manufacturer work for about six months on the fall (or spring) collection. Drexel Heritage, Henrydon, Harden, Baker, Hickory White, Hickory Chair, Ferguson Copeland, Stickley…every major and most minor manufacturer is represented.

The collections are hand-built into prototypes—some of these things are one-of-a-kind works of art. And then all the furniture retailers swarm to High Point for a week-long show. Each manufacturer has a “showroom.” Some of these showrooms are actually permanent structures, with elaborate reception areas, significant architecture, meeting spaces…one has a patio overlooking a golf course. And the retailers are greeted with old-fashion Southern hospitality (since the industry has historically resided primarily in the Southern highlands).

The retailers walk through the showrooms and place their store orders based on the prototypes. It’s like selecting from a 3D catalog, in which you walk around. Many (maybe most) of the prototypes never receive orders. And only those with enough orders for practical mass manufacturing ever go into production. There is, in fact, a subset of the furniture industry built around buying up and distributing “non-performing” prototypes. Chairs with arms that are too curly. Tables with too much gold leaf on the race-track borders. Furniture with legs that are too heavy or too spindly. Wardrobes with too much “distressing” on the doors. Things that are too delicate, to masculine, too shiny, too dull, too … last decade, too … next year.

A couple of things we love about market, that you just don’t find anywhere else:
• the genteel hospitality, even as they do hard-ball business deals
• the realization that furniture goes in and out of style…every six months
• the sense of how BIG the furniture industry is
• the sense of stepping back in time, to the way all business used to be conducted
• the feast of master craftsmanship and incredible design
• the chance to see spectacular furniture, you may never see again
• the opportunity to spend a day with our old friend, Eddie.

I was talking with Sally Massagee, a CPA in Hendersonville, NC, about … all sorts of things. One of which was how to read financials.

I have always looked at our P&L with an intuitive, squinty-eyed fuzziness—sort of the way art directors look at page layouts. I really never grasped the detail. But I was able to understand things like balance, trends, fixed cost, topline billings, and stuff like that. I thought the word for me was financially challenged. But Sally taught me otherwise.

“Listen to the numbers” resonated with me. If you look at numbers and all you see is numbers, its a little like looking at the Mona Lisa and seeing paint on canvas. If you don’t see the picture, what’s the point?

Same with things like media cost, postage, printing costs, sales reports, and all those other things we spend so much time wrestling with clients about (and with each other). Is $5,000 a lot to pay for printing a post card? Maybe. Can you get it cheaper? Well, you can certainly get something cheaper. But all that is looking at the paint and ignoring the picture.

We are philosophically predisposed to start with strategy…and that starts with objectives. Now, if the strategy says, generate $10,000 worth of transactions (as a goal), and $5,000 worth of something (post cards) will generate that, then $5,000 is not a lot to pay for printing the post cards. If $2,000 worth of a cheaper post card will not generate the $10,000 worth of transactions, then $2,000 is a lot to pay. Too much in fact.

In the strategic paradigm we work in (OGSM), the cost of the post card would be part of a list of things called measures. It’s at the end of the process for a reason. If you start with measures, then you’re already saying, “it won’t work,” or “it costs too much,” before you even know what “it” is.

I loved that Sally’s approach was to begin with listening, rather than with calculating.

For about as long as I can remember, I’ve been aware of the idea of strategy. Back when I played middle school football, we learned about two big strategic principles: pile up resources at the greatest area of need, and (contrariwise) deploy resources away from the point of contact, to A)trick the opponent into deploying their resources poorly (play action pass), or B)dilute your opponent’s resources in hopes of a mismatch (stretching the field with a fast, deep-threat wide receiver, in order to create opportunities over the middle).

In marketing, examples of these two tactics might be:
Concentration of resources:
• A retailer spending a majority of advertising budget between Thanksgiving and Christmas, to coincide with consumer behavior
• A manufacturer assigning a full-time rep to a single customer company, in order to cultivate deep relationships, secure the customer’s loyalty, and expand the footprint within that customer company
• Coordinating national, regional, and local advertising around specific “promotional” periods, and focusing messages on the specific offers of the promotion.

Generally, these are strength-against-strength tactics. They are very logical. And they will work, over time, given a solid product, a competitive price, and continuous, predictable demand.

Contrarian deployment:
• A retailer, recognizing the trend toward post-holiday sale shopping, saves the majority of its advertising budget for a post-holiday sale blitz
• A manufacturer who is well know in one industry, but less known in other industries, assigns a full-time rep to getting first purchases (trial) from customers in adjacent industries, while “milking” the industry in which they are established…risking that their products will become commodities in the established industry, as the threat the industry as a cash cow
• A manufacturer launches a directly competitive product with a media blitz in the hometown (or a strong market) of an established brand, forcing the established brand to “defend its turf”—the hope is that the established brand will over-react (overspend) or get distracted from their core business…creating opportunities elsewhere
• A brand with a cash advantage spends excessively in a market “owned” by a less liquid competitor, forcing the competitor to defend what it might otherwise have taken for granted…milking the competitors limited resources.

Of course, these strategies are all risky, and none of them can really be considered long-term strategies. Their purpose is to change the status quo, so it would be silly for someone to employ them who benefits from the status quo.

One problem with some upstart start-ups is that they become very good at contrarian tactics, to the point that these tactics become part of the culture. But, when they become the man, they are still culturally inclined to fight the man. They don’t know how to act like category leaders.

The job of the category leader is to promote the category. So, category leaders should use strait-forward, logical (boring) strategies, in order to signal to consumers, competitors, and vendors what the category is doing. This may seem charitable, but it really isn’t. A lot of people (probably most) want to do business with the confident leader. So, by successfully taking the leader posture, a company is effectively blocking competitors from potential customers. Think of Tide, Cheer, Crest, Gleam, Head ’n’ Shoulders, Clorox, and Shout. By being the voice vendors listen to for direction regarding how to sell to the category, a company puts itself first in line to negotiate the best deal with potential vendors. And by signaling to competitors, a leader gives itself a home field advantage.

Everybody else’s job is to take shots at the category leader, by slicing off niche markets, cherry picking high-value customers, and/or offering a mass-market alternative (me-too) choice to consumers. When number two becomes number one, the whole category can feel shock waves for a while.

Business is not a philosophy class or a smoke filled dorm room in the middle of the night. It’s really pretty simple. Do you offer something people want at a price they want to pay? If so, say so. If not, change your price, change your offering, or fold up your tent and go home.

We have been enjoying working with a new brand concept for a few months now. They are great folks (and that is not something you can ever take for granted). But what makes it really enjoyable to work on their business is that they know what they stand for. They are out there on a limb, saying, “people are willing to pay for a really awesome steak!” If they’re wrong, well, they are out there on that limb. But if they’re right (and it’s looking as if they are), they have that limb all to themselves.

Funny, isn’t it, that a you can go back about fifty years, and walk down a street in a pedestrian neighborhood in Brooklyn, and bump right smack into a breakthrough 21st century brand concept. Great piece of meat. Knowledgeable, friendly service. Some good stuff to go with it, to round out the meal. Seems like a no-brainer, which is a pretty good indicator that either it has already been done (which does not appear to be the case) or it’s a sure winner.

We will see.

Took about as long as it took James Joyce to write Ulysses, but our new site is up. Go check it out. Let me know what you think.