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SECTION 1
Understanding the Brand Journey
Welcome to this tale of the brand and its customer. This book can be viewed from several different lenses. It can teach us how to acquire customers and turn them into fans (a state different from mere loyalty); it can help us understand how to execute the complete marketing, sales and customer success cycle in our digital era; and it can enable us to create a brand that people love - whether for ourselves or for our companies. Many of the fundamentals here are naturally steeped in traditional theories we learn in B-schools. However, in the era of AI, a marketer’s job looks very different, thanks largely to its focus on analytics and automation.
Artificial Intelligence for Managers, the first book in this series, focused on AI techniques and their management. This book focuses on the Marketing use cases of those techniques and looks at pre-existing tools to guide marketers in the formulation of a robust tech-enabled marketing plan. The narrative is loyal to what marketers need to learn and execute this discipline in the field. It borrows from a comprehensive marketing plan that the authors have developed over the years to function in any industry, with key emphasis on the timing and the reason behind undertaking any marketing initiative if you wish to see results. To cite an example in the context of social media, the questions this book will answer is not What does Twitter do, why is it useful or how to create a Twitter account and post regularly, but How to decide if Twitter is right for your business, when to activate it in your brand journey, which steps to take in every session on the platform, and which tools can help you execute those steps efficiently and effectively. As a result, you will walk away from this book with the knowledge to develop your own templates and automations to execute a technology-driven marketing, sales and customer success process in the present times.
As you will find, social media, and indeed, digital marketing is one cog in a larger ecosystem. And while this book looks at tools and techniques that drive the modern-day customer journey, it is important to understand both the customer journey and its relevant technologies to make sense of where and when to use what. That is why we begin this first section by understanding the marketing and AI ecosystem itself, the customer/brand journey, and the target you should really be aiming for.
The first section sets the stage with three business use cases that will be followed throughout the book. It also looks at:
- The importance of maximizing brand equity
- What a typical brand journey looks like
- How marketing, sales, and customer success work together
- The impact of AI on marketing
The chapters included are:
- Chapter 1: The Importance of Brand Equity
- Chapter 2: A Typical Brand Journey
- Chapter 3: The Convergence of Marketing, Sales, and Customer Success
- Chapter 4: AI and the Future of Marketing
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CHAPTER 1
The Importance of Brand Equity
In the introduction to Section 1, we mentioned that this book will teach us how to acquire customers, turn them into loyal fans, execute the complete marketing, sales, and customer success cycle in our digital era, and create a brand that people love. But why is the key to achieving all this so ingrained in branding?
Structure
In this chapter, we will discuss the following topics:
- Defining brand equity
- Importance of brand equity
- Marrying marketing, sales, and customer success
- Introducing Una and her brand
Objectives
This chapter lends clarity on the goal we will be pursuing through the course of this book: maximizing brand equity. It explains what that means and why that is important. By the end of this chapter, you will be able to identify the primary growth objective of any business, understand the meaning of brand equity and how it impacts a brand, understand why marketing, sales, and customer success need to work together, and get acquainted with Una and her brand, whose business case will help guide us through a typical brand journey.
1.1 Defining brand equity
The primary task of any business is to make money, responsibly. That involves offering a product or service in a socially, environmentally, and ethically responsible manner, which a customer will happily pay for. The latter in turn requires at least two conditions to be met: the product or service should add value to the customer, and the business should comply with the customer’s personal, social, and ethical value and aspirations. A brand is that singular piece of identity that surmises both these conditions in the minds of a customer.
Every entity has a brand, whether it is an individual, a company, or a product. Think about it: You have a subtle opinion of everything and every person around you; and that perception or identity you associate with that entity influences your conduct or engagement with it. Brands work in the mind and consequently, have the power to surpass facts. To cite a pedestrian example, think about how easily many of Donald Trump’s supporters would accept the reality of climate change, if Trump himself endorsed it. On an organizational scale, think about the unwavering perception of superior usability that die-hard fans of Apple carry about the brand, regardless of the company’s minimization of ports and its relatively closed ecosystem. Or the consumers’ desire to buy the latest model every year, strong enough to justify standing in hour-long queues outside Apple stores.
Apple is one of the few brands strong enough to have even managed to convince its consumers that they need an entirely new product type, such as a tablet. Was it a real pre-existing but unrealized need, or did it come into existence the first time we laid eyes on the concept of a tablet? Of course, some product lines are created to meet an existing need such as Gatorade’s energy drinks, originally invented to address sports nutrition. It led to the creation of an entirely new segment in a drinks industry previously considered saturated. Such innovative measures to meet an explicit or undiscovered market need, coupled with effective barriers to market entry, can supercharge a brand’s growth, thereby ensuring its appeal to consumers. We will discuss this more in the next section. For now, spare a moment to a brand’s linkage to sustaining customers.
Economies grow and shrink over time, as do specific product demands within an economy. The simple solution to sustaining and retaining customers’ interest is to keep fulfilling a need they value. The better the fulfilment, the higher the brand’s value and appeal. That is measured by brand equity. It measures the power of a brand, which reflects the value of that brand for its customers. A brand’s equity is the incremental value (say, goodwill or financial value) that a customer attributes to a product purely due to its brand. Imagine a pair of Nike shoes, without the Nike logo on it. How much more would a customer be willing to pay for these shoes if it had the logo? That is Nike’s brand equity.
But why am I telling you this? Branding is rarely conceived as a discipline core to an entity’s existence and crucial for its growth. This in turn leads to a person or business developing an unclear identity in the minds of its audience, which in turn implies a lack of appreciation for the value it can offer. Let us now understand why a focus on brand equity is so important.
1.2 Importance of brand equity
Consider a movie where an A-list actor gets paid $10 million, while his lesser known coactor with an equally important role in the movie, and perhaps even better acting skills, gets paid $100,000. That incremental $9.9 million salary is directly attributable to the A-list actor’s brand value. As we saw with Nike’s example, that is the power of a strong brand equity. Without it, a brand will remain easily replaceable in the minds of its customers. So, in many ways, the implied objective of a business or individual looking to increase its customer base and market value is to maximize its brand equity.
Strong brand equity is important because it ensures that the brand’s customers keep choosing its products over others. In a situation where the product itself becomes obsolete or less important, a strong brand equity allows the company to transition to alternate offerings without losing its customers – or at least gaining new ones more easily.
A stellar example of a popular brand reinventing itself would be Fujifilm, which had originally considered the digital threat to its core film photography business to be somewhat exaggerated, having tried to pivot too soon. It’s competitor, Kodak, tried to meet the threat head-on and eventually failed when the digitization of photography truly took hold. Fujifilm, on the other hand, invested in assets that initially seemed totally unrelated and came out of its R&D labs in the form of chemical compounds that could serve pharmaceutical and cosmetics industries. These new lines of business eventually turned into multibillion dollar streams, pushing the company’s traditional film photography products to the periphery. (1) Fujifilm survived and thrived, even though the once much more powerful “Kodak moment” lost its sheen.
In an economic downturn, a neighborhood bakery can survive only if it manages to keep the customers coming. That is likely to happen in one of three situations:
First, the bakery offers a product that’s staple for customers in the neighborhood. One such offering would be a loaf of bread, since customers are less likely to splurge on fancy cakes in a dire economic situation. However, the bakery will not only have to focus more on this product line but also ensure it can sell breads at a lower cost than, say, a larger grocery chain like Walmart. Beating Walmart or any mass retailer on prices can be extremely difficult, as the cost of production per loaf is likely to remain higher for the neighborhood bakery.
Second, the bakery can move into a new product line such as raw materials like flour, sugar, sauces, etc. However, beating the likes of Walmart on these materials is once again challenging.
Third, the bakery can avoid the price war. The price customers pay is directly correlated to the value they ascribe to a product. That value could come from offering greater convenience or from the customers having a soft spot for the bakery due to the goodwill it has developed. For example, the bakery could offer convenience with quicker home deliveries or be naturally located in an area far from grocery chains or other competitors. Either of these, however, would require luck and/or additional investment. What about quality? The promise of freshly baked natural ingredient-based bread any time of the day. That sounds appealing, health wise, but would only work on customers who appreciate these in their staple.
Maintaining a higher perceived value of your offering is the only way to ensure you can retain customers because customers will always invest in what they deem important. Your brand represents such an offering. The higher the perceived value, the higher the brand equity. The trick, therefore, is to find what it is that a customer will value, ideally always. Conversely, for a given value on offer, who are the ideal customers and how can that value be made better for them? This is why a brand journey often goes in circles, where the brand is compelled to reinvent its value or in rare cases, even its target customers, with changing circumstances as we saw in the Fujifilm example above. The really good ones, of course, manage to hold their value through most of the changing winds, thereby saving the organizations a ton of investment, effort, and uncertainty.
That state of maximum brand equity, as we will learn later in this book, is called brand resonance. And it has to do with our most innate desires, our values and things that tend to make us sentimental. These are invisible attributes, historically identified by marketers through psychometric focus groups, intuition, deep observation, or experience. The era of AI changes that by being able to retrieve such hidden information – behavioral patterns – through automated analysis. The art of uncovering such detail and executing upon it takes us to the realm of customer facing functions – namely, marketing, sales, and customer success.
1.3 Marrying marketing, sales, and customer success
The quest to maximize the brand equity - and to keep it there – is an ongoing endeavor. All of marketing, sales, and customer success is designed to effectively plan and execute the brand journey to achieve it. Organizations continuously need these functions because of the continued nature of the brand journey itself. However, what separates effective customer-facing teams from others is that the former is a bunch that understands the importance of strengthening brand equity to ensure the organization’s survival and success. As a result, such teams plan and execute their functions with a singular focus of achieving brand resonance.
Over time, the central role of marketing, sales, and customer success has become less obvious from an organizational point of view. Ironically, a factor contributing to this is our increased knowledge. These core drivers of a brand journey have become incredibly vast and specialized. Today, they rely on very different approaches and compulsively require technologies that automate or support every minor aspect of their roles. As a result, they are generally approached in silos even though the underlying technologies rely on accurate data and information flow across the organization. The employees are often so deep in their respective silos that they simply do not have the time or bandwidth to appreciate the bigger picture. It’s a scenario that organizations are becoming increasingly aware of as they set out to get the organizational data streamlined to be able to use advanced technologies like AI.
In focusing on any one of the three functions or their sub-functions, we often forget to think about whether they are together being effective in increasing the brand equity, which is a key indicator of happy customers. This disconnect results in incoherent execution of tasks in each silo, despite the fact that they are all being directed at the same customer. To understand this, think about a recruiter trying to hire a candidate. The candidate states in his interviews how open he is to different views, but his social media accounts show that he is heavily involved in intense debates and favoritism. To his customer, that is the recruiter who will decide ...
