theory | Thomas Wagner

Challenges for Brand Management: Communication (2.4.3)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here.

Historic perspectives on brand management have identified some distinct phases that each go along with certain developments and traits (Gries 2006, p.15ff; Zurstiege 2007, p.19ff; Tropp 2004, p.22ff). The beginning of modern advertising in Germany is tied to the industrialisation and the associated introduction of freedom of trade (1869) and registered and protected trademarks (1874) (Zurstiege 2007, p.24). With the social acceptance of the concept of competition started the professionalisation of advertising and – along with it – advertising research, which in turn led to the public debate of its central techniques in Vance Packards’ “The Hidden Persuaders” (Zurstiege 2007, p.24).

Gries (2006, p.15) sees products as media of the modern age and describes the process of the medialisation of products. This process started in the late 19th century, accelerated due to a strong increase of demand in the 20s and 30s and is concluded with the widespread diffusion of televisions in the 60s. Since then, according to Gries (2006, p.15) a brand works similar to a newspaper, the radio or television in that it is surrounded by a dense net of communication relationships that formed over the course of this process of medialisation.

Looking at the main functions that brands played in different eras, Tropp identified three phases that he calls “Markierungsphase” (labelling or branding phase), “Wirkungsphase” (effect or impact phase) and “Kommunikationsphase” (communication phase).

The first or branding phase started around the 5th century, when identification and distinction emerged as the first function of brands (Tropp 2004, p.23f). Social developments like the formation of the first cities or the establishment of guilds changed the specific functions of brands. However, it took until the before mentioned dawn of the industrial age, until the ‘effect phase of brands’ emerged (Tropp 2004, p.25ff). Apart from the identification function, brands’ chief function now lied in persuading potential consumers. In addition to the identification of a brand now there is the social practice of identification with a brand (Tropp 2004, p.36). Holt (2002, p.79ff) calls this the modern branding paradigm:

„Marketers made no pretense about their intentions in these branding efforts. They directed consumers as to how they should live and why their brand should be a central part of this kind of life. Advertisements shared a paternal voice that is particular to this era. By contemporary standards, these ads appear naive and didactic in their approach. This paternalism reveals that, at the time, consumer culture allowed companies to act as cultural authorities. Their advice was not only accepted but sought out.“ (Holt 2002, p.80)

Holt (2002, p.83ff) argues, that this paradigm ended up being replaced by the creative revolution of the 60s in what he denoted as an emerging post-modern branding paradigm. Branding then had to cope with social changes at a massive scale and a new anti-corporatist, yet consumerist culture that it somehow had to adapt to. It adopted and in turn relied on five central and then new techniques (for a description of the techniques that had a widespread media impact see Klein 1999): Authentic Cultural Resources, Ironic, Reflexive Brand Persona, Coattailing on Cultural Epicenters, Life World Emplacement, Stealth Branding . While these techniques were certainly new and a response to changing cultural and social environments at the time, they have again run into some severe contradictions and are losing their effect quickly (ibid.).

Holt (2002, p.68ff) and Tropp (2004, p.68ff) both argue that we can now see a different phase, that puts the relationship between a company and its consumer, or in general its role in society into focus. Driven on the one hand by the pressing scarcity of attention (Schmidt 2004, p.53ff; Tropp 2004, p.71f), by changing attitudes and expectations that citizens have of the role of companies in their communities and by the emergence of new technologies and feedback channels that made marketing tactics like CRM, but also a society ever more aware of the power of their public opinion possible. While doubts about the role, effectiveness and efficiency of advertising are a main driver of this transformation, this perspective also implies a more consumer-centric view of communication. It argues that the construction of meaning is done by consumers within the boundaries of collectively shared social symbols and ultimately demands a rejection of the pure sender-receiver model of mass communication as conceptualized in the early 20th century (Tropp 2004, p.72) and since then renounced by communication research.

The main conclusion of this current phase of branding is that companies are now more than ever competing in the field of communication and that communicative competence that goes beyond advertising is becoming a core asset of companies.

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Gries, R., 2006. Produkte & Politik: zur Kultur- und Politikgeschichte der Produktkommunikation, Facultas Verlag.
Holt, D.B., 2002. Why do brands cause trouble? A dialectical theory of consumer culture and branding. Journal of Consumer Research, 29(1), pp.70–90.
Klein, N., 1999. No Logo: no space, no choice, no jobs ; taking aim at the brand bullies, New York, NY: Picador.
Schmidt, S.J., 2004. Die Werbung ist vom Anfang an am Ende. In S. Kemmler, J. Ballentin, & C. Gerlitz, eds. Die Depression der Werbung. : Berichte von der Couch / Berliner KommunikationsFORUM e.V. Sebastian Kemmler. BusinessVillage.
Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.
Zurstiege, G., 2007. Werbeforschung 1st ed., Utb.

Challenges for Brand Management: Coupling (2.4.2)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here.

Just as complexity, structural coupling is a key term of systems theory. Usually used to describe the structural relationship between cognition and communication via language and media (Tropp 2004, p.64), this concept may be used in brand management to denote the relationship between companies that produce brands and consumers and bridge the before mentioned dichotomy between producer- and consumer perspective – or image and identity (Tropp 2004, p.65). Structural coupling in that context means that while a company as a social system and a consumer as a cognitive system are to be strictly distinguished, no company is possible without consumers and vice versa (Tropp 2004, p.64).

To specify and manage this structural coupling between a company and its consumers via the brand as realm of knowledge is one of the most pressing issues of brand management and again, able to integrate mostly consumer-oriented trends and pressures. For example, there is an apparent contradiction between an increasing brand consciousness and an at the same time decreasing brand loyalty with consumers (Essinger 2001, p.66 qt. in Tropp 2004, p. 66) that also taps into the debate about consumers’ increasing unpredictability. Using data from a global, longitudinal survey that runs since 1993, Gerzema and Lebar (Young & Rubicam) have found out that since 2004 all consumer attitudes towards brands over the globe were in decline.

“Across the board, we saw significant drops in the key measures of brand value, such as consumer “top- of-mind” awareness, trust, regard, and admiration. This was true not just for a few brands, but for thousands, encompassing the entire range of consumer goods and services, from airlines and automobiles and beverages to insurance companies and hoteliers and retailers.” (Gerzema & Lebar 2009, p.2)

They argue that a brand bubble has developed for the fact that while the valuation of brands as done by financial analysts is steadily increasing, this overall value that these brands actually deliver for consumers, is provided by less and less (stronger) brand in the overall brand universe.

This contradiction does not put an end to the structural coupling of consumers and brands, but it suggests that the relationship between them has fundamentally changed. Since the 1980s, until then mostly unidirectional relationships have transformed into interactive and multi-directional relationships, as signified by developments such as relationship marketing, one-to-one-marketing, direct marketing, permission marketing, customer relationship management or the developments happening under the umbrella term of social media marketing. As research conducted under the relational paradigm (MacInnis et al. 2009; Fournier 1998) is striving to provide scientific insights into the company-brand-consumer relationship, branding has moved from what Tropp (2004, p.67) calls the effect phase to the communication phase.

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Essinger, G., 2001. Produkt- und Markenpolitik im dynamischen Umfeld: eine Analyse aus systemtheoretischer Perspektive, Dt. Univ.-Verl.
Fournier, S., 1998. Consumers and their brands: Developing relationship theory in consumer research. Journal of consumer research, pp.343–373.
Gerzema, J. & Lebar, E., 2009. The Trouble with Brands. strategy + business, 55(Summer 2009). Available at: http://www.strategy-business.com/article/09205 [Accessed February 4, 2011].
MacInnis, D.J. et al., 2009. Handbook of brand relationships, M.E. Sharpe.
Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.

Challenges for Brand Management: Complexity (2.4.1)

This post is part of my paper ‘The Evolving Role of Creativity in Brand Management’. You can see the other posts and the table of contents here.

While in the past three global CEO studies, conducted by IBM, coping with change was the most pressing challenge, complexity took the lead in 2010, as seen in Figure 2.

“CEOs told us they operate in a world that is substantially more volatile, uncertain and complex. Many shared the view that incremental changes are no longer sufficient in a world that is operating in fundamentally different ways.“ (IBM 2010, p.8)

Figure 2: Organisations and complexity (IBM 2010, p.15)

Complexity is the most important concept in systems theory, as it is the reason why systems form in the first place. While the term is present in different approaches to systems theory, Luhmann’s theory of social systems popularized it, stating

“we will call an interconnected collection of elements complex when, because of imminent constraints in the elements’ connective capacity, it is no longer possible at any moment to connect every element with every other element […] Complexity in this sense means being forced to select; being forced to select means contingency; and contingency means risk.” (Luhmann 1995, p.25)

A system can never reach the same level of complexity as its environments and therefore has to counter-balance this inferiority with selection-strategies, reducing external complexities (Tropp 2004, p.57). This necessarily selective reduction of relations between elements (e.g. information) is called contingency and brings with it the necessary risk to select different possible combinations of elements. However, with every selections come different other – not selected – possibilities that would be possible as well.What sounds arbitrarily complicating in the first place, does make sense in light of the unrelated and relatively arbitrary list of trends, drivers and perspectives that are present in brand management and marketing textbooks. To illustrate the concept of complexity in this context, it can be said that branding theory does not have an appropriate selection strategy (theory) that is able to reduce the environmental complexity (challenges) to a level that would allow for sensible systematization.

Complexity is a theoretical concept that is not able to explain the myriad of trends and environmental challenges, but the fact that companies will – in the future – have to accept unprecedented complexity as a permanent trait of their environment (Rose & Zuckerman 2009, p.13) and to acknowledge that “it’s no longer possible to observe and predict enough to map out courses of action that guarantee desired outcomes” (Andjelic 2010).

This has some important implications for strategic planning and strategic thinking that will be introduced at a later point.

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Andjelic, A., 2010. the problem of strategy. i [love] marketing. Available at: http://anaandjelic.typepad.com/i_love_marketing/2010/07/the-problem-of-strategy-1.html [Accessed January 4, 2011].

IBM, 2010. Capitalizing on Complexity. Insights from the 2010 IBM Global CEO Study. Available at: http://www-935.ibm.com/services/us/ceo/ceostudy2010/index.html.

Luhmann, N., 1995. Social systems, Stanford University Press.

Rose, J. & Zuckerman, N., 2009. Can You Reach the Masses Without Mass Media? Available at: https://www.bcgperspectives.com/content/articles/cmos_dilemma/ [Accessed February 4, 2011].

Tropp, J., 2004. Markenmanagement: Der Brand Management Navigator. Markenführung im Kommunikationszeitalter, VS Verlag.

About the ‘Science of Marketing’

At the moment a presentation and a video by Byron Sharp about the science of marketing are making rounds in the plannersphere. They are based on Sharp’s book “How Brands Grow. What marketers don’t know“. About this book Martin Weigel says:

If you want to buy one book this year to help you (or the marketer in your life) be a better a marketer, don’t buy all the data-devoid stuff that makes us feel cutting edge, or massages our egos. I suggest you read this one. It is full of proper data and analysis. And full of the stuff that as Sharp says, marketers should know, but many clearly don’t. Like double jeopardy, retention double jeopardy, the law of buyer moderation, natural monopoly law, etc.

It’s easily the most useful, challenging and illuminating book about marketing I’ve read in years.

I haven’t read the book yet, but after this enthusiastic review it is now lying on my desk. From what I can see, a lot of it is based on Andrew Ehrenberg’s work, which is not surprising, given that Sharp is at the Ehrenberg-Bass Institute. For those of you who don’t know Ehrenberg, who passed away last summer: he was the sage of marketing science, looking for and finding consistent marketing laws, most notably the Double Jeopardy law. He also wrote some interesting papers about advertising effects and a quite interesting comment in Strategy+Business called Marketing: Are you Really a Realist (free registration).

As shown in his work Ehrenberg is a passionate advocate of using the methods of physics in social science:

Even in a field supposed to be dominated by people’s impulses to buy – that of marketing – there are striking regularities … [yet] people seldom expect there to be law-like regularities in social science (‘Is it a science?’) and therefore do not even look for them. (Ehrenberg 1993)

Sharp is promoting the same school of thought and you should definitely have a look at his talk.

Undeniably, law-like patterns as the ones he mentions in his talk are interesting. I am a huge believer in Ehrenberg’s view of advertising as being not so much persuading than nudging and that salience (in combination with widespread availability) is what often explains big brands better than anything else. However, with the nature of generalizations comes – I think – an exaggerated trust in what ‘the data’ tells us, which might lead to some laziness in interpretation, analysis and understanding. After all, what ‘the data’ doesn’t tell can’t be there, right?

Now this might sound like the sulky response of a ‘social constructivist’ (or any other ‘anti-positivist’), but have a look at how Sharp presents his argument about Harley Davidson. He’s spot on when he says that Harley and Apple are the two brands always being mentioned as examples for cult-like loyalty and other brand anomalies and he rightfully dismisses these myths. However, when it comes to the Harley consumer segmentations he goes on to laugh about the fact that only few of Harley consumers are actually like one would imagine Harley riders, while the rest of them lives a more ‘regular’ life – you know, the one without violence and drug trafficking. He argues then, that we spend too much time pampering the loyals and not enough time growing the others. Now, without having read the book, in arguing like that I think he omits that the 90% might only drive a Harley because they’d love to feel like the tough guy once in a while. And while I do know that this isn’t exactly an insight or new thought, I think it is quite a good accomplishment to commercially ‘reach’ 9 times the people that are actually into the meaning you promote, the one your brand is perceived to (theoretically) stand for. This is – in my humble opinion – something that empirical marketing science couldn’t explain, because it’s not and won’t ever be in the ‘data’.

The more you rely on generalizations, the more general your insights and understanding becomes. To fit a situation into your law, you have to chip away parts of what you want to explain.

So now I’ve got to read that book.

Sources:

Ehrenberg, Andrew (1993): Even the social sciences have laws’, Nature, vol. 365, p. 385.

Sharp, Byron (2010): How Brands Grow. What Marketers Don’t Know.

Master Thesis Topic (update)

After getting a lot of useful comments (thank you!) on my initial brainstorming on possible topics for my master thesis I cut them down to three and handed in a description of three very broad topics, all with some more concrete research questions: (1) ‘Post-Postmodern’ Uses of Brands and Media?, (2) ‘Continuities from Propaganda Theory to Planning:’ and (3) Reception and Usage of ‘Transmedia’ Narratives.

So here’s my translated description of topic (1), that I handed in before leaving and which has got a strong endorsement from the prof while I was in Tanzania.

‘Post-Postmodern’ Uses of Brands and Media?

According to Holt (2002) there are two relevant branding paradigms in the 20th century. The first is called “Modern Branding” and was based on a domineering, cultural engineering approach. It was dominant until the 60s, when the ‘creative revolution’ around people like Bill Bernbach appeared.

Marketers made no pretense about their intentions in these branding efforts. They directed consumers as to how they should live and why their brand should be a central part of this kind of life. Advertisements shared a paternal voice that is particular to this era. By contemporary standards, these ads appear naive and didactic in their approach. This paternalism reveals that, at the time, consumer culture allowed companies to act as cultural authorities. Their advice was not only accepted but sought out. (Holt 2002: 80)

This modell – now being popularized by the TV series Mad Men – was inspired both by Freudian psychoanalysis and the scientific approach to advertising and persuasion at the time, provoked rising resistance in the 60s, with books like The Hidden Persuaders and other critical analysis appearing on bookshelves. With the increasing professionalization of the industry and knowledge about the branding paradigm more and more entering the public sphere, the public opinion was increasingly directed against the supposed manipulation of the individual.

Branding could no longer prescribe tastes in a way that was perceived as domineering. People had to be able to experience consumption as a volitional site of personal development, achievement, and self-creation. Increasingly, they could not tolerate the idea that they were to live in accord with a company-generated template. (Holt 2002: 82)

In reaction to the creative and anti-commercial countercultures of the 60s – and with that at the time when interpretative approaches started to challenge the predominant stimulus response thinking – a new branding paradigm emerged. Holt calls this paradigm “Postmodern Branding”. In a postmodern consumer culture, the role of branding would emerge from the supplier of a cultural blueprint – “How should I live?” – to supposedly authentic, cultural ressources to be used for the identity projects of consumers who strive for independence from paternalistic and authoritarian corporations.

Postmodern consumer culture has adopted a particular notion of authenticity that has proved particularly challenging to marketers. To be authentic, brands must be disinterested; they must be perceived as invented and disseminated by parties without an instrumental economic agenda, by people who are intrinsically motivated by their inherent value. Postmodern consumers perceive modern branding efforts to be inauthentic because they ooze with the commercial intent of their sponsors. (Holt 2002: 84)

To produce these ressources in a distanced and commercially disinterested way, five branding techniques – also made public by Klein 1999 and Frank 1998) have emerged over time: (Holt 2002: 83ff)

Authentic Cultural Resources
Ironic, Reflexive Brand Persona
Coattailing on Cultural Epicenters
Life World Emplacement
Stealth Branding

All of these techniques however, are confronted with substantial contradictions. Ironic distance has been imitated without end and is now outdated, stealth marketing is getting more and more aggressive and reaching its limits, marketers are running out of counterculture content to tap for their campaigns as the authenticity market heats up, consumers are increasingly peeling away the brand veneer and “collectively, postmodern branding floods social life with evangelical calls to pursue personal sovereignty through brands” (ibid.).

For Holt these phenomena (published in 2002 – before ‘social media’ even existed) pointed to an expiration of the postmodern branding paradigm. Whereas brands in the future would still have to offer authentic and relevant resources, authenticity won’t not be conveyed distance the brand from a profit motive, but through a role that Hold calls ‘citizen artist’.

So brands will become another of expressive culture, no different in principle from films or television programs or rock bands (which, in turn, are increasingly treated and perceived as brands). […] Postmodern brands have little value in this new consumer culture. Because they rely so much on the cultural work of disinterested others and work so hard to deny that the brand itself stands for anything by itself (for fear of being tagged as cultural engineers), postmodern brands lack an original point of view that they can claim as their own. Rather than take a free ride on the backs of pop stars, indie films, and social viruses, brands will be valued to the extent that they deliver creatively, similar to other cultural products.

The citizen part on the other hand is concerned with the socially responsable behavior of corporations and their brands, basically answering the question of what is behind the brand veneer.

This topic and Holt’s only superficially covered hypotheses give rise to a lot of questions that might be covered in a master thesis. (Not all in one of course …)

What – to people – is authenticity in advertising and marketing communication? How is it operationalized? What are expectations?
How does authenticity translate in regards to aesthetics – from user-generated content to brands using a documentary style?
How does the use of digital, social networks (‘social media’) have affect the ‘corporate cool machine’ as described by Holt in the postmodern branding paradigm. Is his hypothesis regarding brands being used in the role of citizen artists true? Or, more concrete: which range of uses of original, authentic and creative brand content can be shown? And in regards to the ‘citizen’ part of the hypothesis: do people really look behind the brand veneer and if so, how?

Frank, T., 1998. The Conquest of Cool: Business Culture, Counterculture, and the Rise of Hip Consumerism, University of Chicago Press.

Holt, D.B., 2002. Why do brands cause trouble? A dialectical theory of consumer culture and branding. Journal of Consumer Research, 29(1), S.70–90.

Klein, N., 1999. No Logo: no space, no choice, no jobs ; taking aim at the brand bullies, New York, NY: Picador.

Mad Men – AMC. Mad Men. Available at: http://www.amctv.com/originals/madmen/

The Trouble with “Cultural Mapping”

I recently read an article at contagious (hat tip to Sebastian Garn for sharing) about Amsterdam Worldwide claiming to create better global campaigns because they are using a scientific method of analyzing cultures – which they call Cultural Mapping. That tool they cite is Hofstede’s cultural dimensions, which basically says people – or cultures – are different in the dimensions Power Distance; Individualism; Masculinity and Uncertainty Avoidance.

While I certainly agree that being culturally relevant is important, if not the most important aspect of brand management and communication, I do find a bunch of things interesting in that story.

First of all, it’s not like Amsterdam Worldwide has uncovered an academic secret. This is one of the most cited theories ever. According to Google Scholar he’s been cited 8810 times and from what I’ve been told at the university, even ahead of guys such as Jesus or Karl Marx. I think I heard it alone 5 to 10 times in my bachelor. Of course, it’s not like they are saying they use this model exclusively, but I still find it strange that an agency runs an article about something everybody who ever did an intercultural training has heard of before.

Then of course, using this model – just as any other model – doesn’t guarantee anything. It’s a model to not forget cultural dimensions but I think it’s not that good of an idea to base roundhouse-kick-like generalizations upon it or to expect ground-breaking “insights” from using it. I just think that focusing on a smaller group of people and finding out something interesting about them is more important than matching communication with a top-level insight about what is modeled as mainstream culture. (I always try to keep in mind that there might be bigger differences between Austrian IT-ers and “blue collar” workers than between IT-ers from Austria and Slovakia. And let’s not forget gender issues, age and other stuff.)

Last but not least, the research Hofstede has build his theory upon has been heavily criticized. It’s pretty old and it was done only with IBM employees at the beginning – IT people not exactly being the most representative sample group. Also, for example for Austria it concluded that we have among the lowest power distance score worldwide, meaning

“[…] people expect and accept power relations that are more consultative or democratic. People relate to one another more as equals regardless of formal positions. Subordinates are more comfortable with and demand the right to contribute to and critique the decisions of those in power”.

Power Distance

Now the intersting thing is that this is totally against what Austrian common sense would tell you and what researchers at my university found out, and it can only be interpreted and understood if you spend some time thinking about Austrian history and culture. What this dimension doesn’t tell you is that “Austrians” do like to complain about their bosses, don’t respect them too much and do think that their politicians, doctors, intellectuals and whoever else aren’t any smarter or deserving than “we” are. This, however, is only true if said people aren’t in the room. Once they are present the generalized “we” very much focuses on academic titles and job titles, hierarchies and power. So “Austrias” have a pretty much schizophrenic relationship with authority which my prof reasoned is because of some 1000 years of monarchy and bureaucratic state. “Cultural Mapping” won’t tell you this. And neither will it tell you how second-generation immigrants have appropriated this into their lives.

I like theories and models, I just think one has to be careful using them.

12 Brand Definition Themes Identified (by others)

As a result of the content analysis of this literature, we identified twelve main themes which we thought were an accurate categorisation of the broad range of definitions of the “brand” in the literature, i.e. as: i) legal instrument; ii) logo; iii) company; iv) shorthand; v) risk reducer; vi) identity system; vii) image in consumers’ minds; viii) value system; ix) personality; x) relationship; xi) adding value; and xii) evolving entity. The categorisation into the twelve themes was fairly straightforward, since most authors used buzz words such as “personality” or “relationship” either in the definitions themselves, or in the discussion of their view of the brand. As we discuss in more detail in below, there is some overlap among the elements of different definitions, which are therefore not mutually exclusive. However, the twelve themes represent a categorisation of the most important propositions in the branding literature.

This is a quote from de Chernatony, L. & Riley, F.D., 1998. Defining A “Brand”: Beyond The Literature With Experts’ Interpretations. Journal of Marketing Management, 14(4/5), 417-443.

I think it’s valuable to read this kind of stuff and deal a fair share of time with what could be denounced as a pure semantic, abstract and theorectical exercise. Why? Because it could eventually help me to understand the perspective a client, partner, team or boss has on the topic, which in turn allows me to reach a goal easier just by making my thinking – or its packaging – more compatible with the associations people already formed. (That, and finishing my bachelor thesis …)

A sign showing how subjective our business is (as Russell Davies has pointed out before)? Rubbish and useless academia?