by Temel Aksoy
Becoming an “employee brand” is a daunting goal for any company to achieve. Granting employees all of their rights and benefits, organizing surprise birthday parties for them, taking them on picnics or arranging a fun night on the town will fall short of making a company an employee brand. None of these things is the essence of the relationship that the company develops with its employees.
Everyone has expectations of their company that are as straightforward as they are challenging. Every employee wants to
feel valuable,
be part of something successful,
develop themselves,
see a future in their job, and
find meaning at the workplace, where they spend the majority of their time every day.
Employees also expect their company to be fair and transparent in its relations with them. The place where people experience fairness, or unfairness, most acutely in their daily lives is their place of work. How tasks, wages, promotions, awards and penalties are dealt out to employees is how they perceive fairness. Justice at a workplace is the most basic element that affects success and morale.
Employees expect companies to view them as individuals, not as a work force or as a human resource. They want the company to respect them regardless of their religion, denomination, race, gender or political views.
Employees want their company to provide training. They expect the company to invest in them, not just for training that’s useful on the current job, but also to acquire qualifications they’ll use in the future.
Employees want to be heard. Companies aren’t democratic places (and they don’t have to be, either); employees don’t have equal responsibilities and authority. But every employee wants to express their own opinion about the decisions that will be made. What people really want is for their opinion to be heard and taken into consideration—but not necessarily implemented.
Employees want to be part of something successful, as stated above, and they want to be appreciated for the work they do. Not only do they expect financial compensation for their work, but also—and more importantly—they want managers to appreciate their effort.
It’s extremely difficult for a company to truly meet all of these expectations, so we see very few successful employee brands in real life. Lots of CEOs dream of turning their companies into an “employee brand,” but the number who have succeeded is negligible. Getting employees to embrace a company and act in concert with each other like a single body (as one) is a difficult ideal to achieve.
In spite of the challenges, however, every company in the twenty-first century should at least be striving to come closer to the ideal of the “employee brand” so that they can obtain the willing cooperation and contribution of employees from different races, societies, faiths and backgrounds, all united around a common goal and philosophy.
86. Cor
porate Social Responsibility
The public expects companies to engage in altruistic acts that benefit the citizens of the countries in which they operate. This is why most large companies in the majority of countries now take on corporate social responsibility (CSR) projects in the areas of education, health, culture and the environment.
However, most of the CSR work that companies perform in response to this public expectation is more for show and reputation enhancement than for truly altruistic and philanthropic motivations.
Apart from the very beneficial work done by a handful of companies, this kind of work is usually done as an attempt to create a certain perception with the public. The foundations established by individuals and organizations such as Melinda and Bill Gates in America are making invaluable contributions to society, but these types of organizations are so rare in any country that they can be counted on one’s fingers.
When decisions are being made about what CSR project to do in which field for what segment of the population, most companies are thinking about the accolades they’ll receive, not what their projects will contribute to social progress. Their real objective is to win public approval, not to help young people, women and the handicapped achieve equal social rights.
Tellingly, most companies spend two or even three times more on publicity for their CSR projects than they do on the projects themselves. No one could object to a company allocating resources to communicating with the public about what it’s doing, but viewing CSR projects as a publicity tool is contrary to the spirit of the work being performed.
There are better ways to highlight the companies that are making a responsible contribution to the public good. Market research firms ranking companies by popularity should also publish how much tax each of these companies has paid. Paying taxes, in most cases, is more beneficial than taking on a CSR project, because with the taxes they collect, governments in every country are capable of undertaking projects that are far more effective than the CSR work of any single company.
Obviously, I support the CSR projects that a handful of companies take on in good faith and sincerity, but the so-called CSR work undertaken by most companies to enhance their reputation is repulsive and disingenuous.
87. Bra
nd Management Is the CEO’s Job
Years ago, HP founder David Packard famously said, “Marketing is too important to leave to the marketing department.” When Packard uttered these words, the production surplus and subsequent difficulty selling products were just beginning. What Packard wanted to say was that marketing shouldn’t be overlooked or relegated to a single department; it was the most important job of any company. Even executives needed to get involved.
Just as marketing rose to the level of the CEO, the “brand” concept has recently followed a similar course. A brand’s function used to be creating recognition and perception in the mind of the customer (consumer), but in recent years it has begun to serve as the locus for multiple concepts.
In recent years, not only do brands address a company’s customers, they also have become a symbol that integrates the company’s mission, vision and values for employees, suppliers and dealers. Companies have increased their investment in their corporate brand to improve their reputations.
To attract talent to their companies, human resource departments have begun to feel obliged to report about their investment in people. Because of these needs, the “employee brand” concept emerged. Corporate brands started to play an important role in attracting talent to the company. In the past, a brand was directed at those on the outside, but in recent years, it has begun to appeal internally to employees as well (details in chapter 85).
Transparency has increased with the spread of the Internet, a medium that has revealed all of the secrets kept behind closed doors. People learned that their shoes were made using child labor in the Far East and that the company that makes the coffee they love so much actually employs people suffering under terrible conditions in South America. Although these aren’t issues that interest the masses, activists made their voices heard and demanded that CEOs be held accountable for these issues. While communicating about their corporate brands, companies began to explain how they handled these issues.
Toward the end of the twentieth century, the impact of corporations on their national economies became so great that these companies began to be questioned not only about how they treat the environment, but also about how they handled relationships with their suppliers, dealers, customers and consumers. They felt obliged to report how responsible, fair and transparent their actions were. Stock markets in different countries demanded that large corporations prepare sustainability reports and be held accountable for how they handle environmental, economic and social relations. They also asked what steps corporations were taking to remedy their deficiencies in these areas. Today, large corporations around the world regularly publish sustainability reports, make commitments to society and strive to fulfill these responsibilities.
Because of these recent cha
nges, what it means to be a corporate brand has evolved. Today, the corporate brand encompasses all of the following:
A company’s mission, vision and values
How it treats its employees and what opportunities it affords talented individuals
What measures it takes in terms of sustainability
Because every department in a company must contribute to manage a scope of this size, it’s only natural that company CEOs will take responsibility for the corporate brand.
MARKET RESEARCH
Every brand’s raison d’être is to provide some kind of benefit to people. The surest way to achieve this goal is to understand what people need or want from products and services, and how they perceive the ability of your brand to satisfy these desires.
The four chapters that follow provide an overview of the different types of market research that exist today. Marketers need to be familiar with the strengths and pitfalls of each of these methods, including when and how to use them while developing their strategies. I’ll also talk about bad research habits and how to avoid and correct them.
My own background is in market research—over twenty-five years of practice. I know firsthand that the insights from research can be invaluable to a brand, but only if marketers know how to tell good research from bad, and how to interpret and apply the results.
88. Mar
keting Metrics
Every company needs to set up a “Marketing Measurement System” appropriate for its category and its company size, because companies can only manage what they can measure.
The primary metrics that companies use are as follows:
Financial metrics Financial metrics are critically important for analyzing every brand’s performance. Sales volume, profitability and cash flow are the brand’s fundamental financial data. Every company tracks these metrics using the reports prepared by its own finance department.
Market and competition tracking In most large companies, the sales and marketing departments regularly monitor the new products, new packaging, new varieties and sales promotions that rival brands launch. They also survey the rivals’ price changes and their advertisements and report them to the company. Working together toward a common goal is key to the success of such a tracking effort. That’s why all of the departments of the company must cooperate if they are to seamlessly collect this information. The research department will handle coordination, but the information is collected by sales, marketing, purchasing, technology and so on because these departments are the first ones to learn about the competition.
Brands that do significant advertising should also monitor their advertisements’ “Share of Voice” (the advertising exposures that a brand gets within the total advertising exposures of the category in a defined period of time). This data is critical, because if the competition is engaging in more advertising today, the brand may lose market share in the future. Even though a category’s leading brand may have the luxury of spending slightly less money on advertising than the competition, no brand can afford to lower its share of voice.
Penetration and market share It’s essential that every brand track its market share, but it’s even more important that it know how much total penetration has been achieved in the market.
Penetration is how many of the potential users in the market have actually purchased the brand over a specific time period (e.g., one year). For example, a candy bar brand’s penetration percentage in one month is low, but it’s higher over two months and much higher over a year because it reaches different people over time.
It’s important to note that penetration is a metric that varies depending on how the brand defines its category. If a brand defines the market narrowly, as “the candy bar shoppers,” penetration will be higher because the brand is measuring its performance within a narrow population of potential buyers. If the market is defined as “the snack food market,” penetration will be lower—the candy penetration is measured within the broader buyer population who buy all snacks, including toaster tarts, nuts, cookies, and so on.
Because product managers want to see and report high penetration for their own products, they usually keep the potential buyer population narrow and the time period long, but this is a very problematic approach, because it’s unrealistic. The fact is, every marketing director should define potential buyers in the broadest possible way and aim to sell to potential buyers in the shortest possible time, because that’s how you grow a brand (details in chapter 26).
Where do marketers find this data about potential buyers? Companies buy their penetration numbers from household panel research and the market share information from research companies that gather data from points of sale. The primary panel studies are as follows:
Household panels in which people record, generally with provided barcode scanners, which brands they’ve purchased for their homes in which product categories
TV viewership surveys that measure which TV channels people are watching, using devices installed in their homes
Research about newspaper reading and radio listening, conducted with various data-collection methods
Retail metrics that record which products and brands shoppers buy at points of sale, and that calculate the market share of these brands (This panel also measures availability at points of sale.)
Research measuring the behavior of website visitors
These are the primary research data necessary to manage a company that sells to the masses:
Awareness and image researches Brands track their availability in the minds of their existing and potential users with custom research. In addition to measuring general brand recall, it’s also necessary to track to what extent the brand is recalled in different usage instances (category entry points or CEPs) (details in chapter 69). Such research can serve as a guide for where to allocate advertising efforts and budgets. For example, if research shows that a brand of clothing only comes to mind when people want to buy a gift or when they’re attending an event, additional advertising should be directed at the brand’s other CEPs, such as casual wear or home wear, to ensure that the brand comes to mind during these instances of need as well. When carrying out this research, brands should also investigate the extent to which their brand clues (colors and symbols) have been impressed on the minds of the potential and existing target audiences, because these branding elements distinguish the brand from its rivals. To a large extent, the recall and selection of any brand is dependent on these branding elements. (See Jenni Romaniuk’s Building Distinctive Brand Assets; additional details in chapters 52, 55 and 56.)
Brands also measure how they are perceived (image) among existing and potential users. As Byron Sharp points out, most companies tend to conduct this type of research too often. Because a brand’s image is a function of its market share—a brand with greater market share is always more popular and well perceived—it’s a waste of time and resources to repeat such researches if the brand’s penetration and market share haven’t changed (details in chapter 32). It might be appropriate to conduct the image surveys annually or every other year.
Usage and attitude research (U&A) Through custom research, companies get information about the consumption habits of their consumers. While critical, this research also includes significant distortion. First, because a consumer’s (customer’s) relationship with a product is multidimensional, and because the product manager wants to collect information about every dimension, the questionnaires for this very beneficial research tend to be long—so long that a normal person can’t give reliable responses all the way through.
Second, people tend to give inaccurate responses to these sorts of questions. During the interview, when people are asked when and how much of the product they use, and where and with whom, they claim—with no bad intentions whatsoever—to use either much more or much less than they actually u
se. The reason for the inaccuracy is that people don’t have a measurement metric and benchmark for product use in their minds; also, their memories mislead them. Calculations based on the data collected from the users are never consistent with the information that the company gets from its own sales and reports or from industry reports. Companies must take measures both to shorten the amount of data to be collected and to give up gathering that kind of biased information so they can minimize such biases when conducting usage and attitude (U&A) research.
Advertising research Since advertising expenditures constitute a significant amount of the marketing budget, every company with advertising expenditures above a certain amount will have special custom research conducted before and after running ads. I think that both types of research are beneficial, so I recommend to the companies I work with that they have this research done. However, I believe that the methodology used by most research companies in post-test (post-advertising) research is not accurate.
These days, the most commonly used questioning sequence is as follows: The interviewer shows an advertisement copy to people and then asks them a series of questions: whether or not they’ve seen this ad, what messages they took away from it, whether or not they liked it, how the ad affected their opinion of the brand and whether or not the ad made them want to buy the brand. After these questions, the interviewer doesn’t stop but proceeds to ask a battery of questions that measure perception of the brand vis a vis the competition.