Remembering Goldman Sachs

This is not an elegy. Despite the current firestorm, Goldman is not going anywhere. It’s big, it’s smart, it’s unbelievably rich, and even if it has done bad things, mere Senate hearings and Schadenfreude will not drag it under.

And yet, and yet.

Goldman was always a special firm. Not the only special firm, but one of a handful that had a tradition in particularly rarified air. Was it always a “white shoe” firm? Maybe. Or not. That echelon included Morgan Stanley, First Boston, Dillon Read, Lazard, and others. Goldman had a heritage that was founded in trading, not investment banking. I’m told that at Kidder, Peabody, (years before I joined), proprietary trading was considered something akin to bad manners. But nobody really cares about these old distinctions any more.

For most of my adult life, Goldman has stood for something close to a secret society and super-exclusive private club that guaranteed wealth beyond imagination to the chosen few, generally but not only from the Ivory League. These chosen few are also some of the smartest, hardest-working, incredibly focused human beings on the planet. They have influence beyond imagining, and they have often employed it for excellent causes.

They outlasted and outperformed virtually all of the blue blood firms. Most in the industry consider them the top firm in the industry. The latest Millward Brown brand value study places Goldman Sachs at number 12 on their list of the Top 100 Most Valuable Global Brands.

There’s a lot for most ordinary humans, to resent about Goldman’s perfection and power. Check out yesterday’s Senate hearings, for instance. As a marketer, though, what galled me was that in the early 90’s Goldman and its advertising agency at the time, Brouillard, came up with one of the most brilliant campaigns I have seen in the category.

I mean, Goldman had never even done a real ad campaign and on their first try, they hit the ball over the fence. It was simple and perfect. Playing off the placement of the Goldman logo at the bottom right in financial notice ads, the message was simple: “Who do you want in your corner?”

Once again, Goldman was the best–this time, in marketing.

It was a short-lived campaign. But for those who remember it, it was iconic. And the message could not have been stronger. Goldman was the company that had your back.

Fast forward. Goldman continued to be smart. Goldman partners got richer. Goldman went public and Goldman partners became rich beyond belief. And something else happened. The traditional stasis between trading and investment banking disappeared. Trading was ascendant. Trading was the way to truly stupendous profits instead of mere fees from client advisory work.

Exactly in whose corner does Goldman now stand?

So Banks Have Lost Trust…Do They Care?

What a difference a day makes!

In my last post, I referenced the Edelman 2010 Trust Barometer survey. In another example of market research telling us what we already know, financial services (banks, insurance, mutual funds, etc.) came in dead last when it comes to the trust factor. In a nutshell, banks and their brethren have gone from being a necessary evil to potential charlatans. This is the kind of news that can make companies shake in their boots.

When I created the first draft of this post yesterday, I had a very cynical tone about the likelihood that banks would really change. Today, I am slightly less so and here is why.

The New York Times today carried this headline in its Business section: “Bank of America to End Overdraft Fees“. This is an example of a bank that is voluntarily and publically taking action on behalf of consumers.

Is this action going to start a trend of banks competing to be the most kind and loving to their customers? Of course not. But it’s telling, and a small step towards regaining some trust.

Below, a reprise of the Edelman recommended actions to regain trust, and my take on each.

1. Work with regulators instead of fighting them. That’s not happening. Consider the words of TARP Chief Elizabeth Warren:

“The reason that we’re not changing things in Washington is that the banks have lobbyists in Washington in numbers I’ve never seen.  They’re coming not just once a month or once a week, or even once a day.  These guys are coming in two, three, four times a day.  They’ve got their position papers, and they just keep slamming in the same direction over and over and over.  And people that want to advocate for American families, that want some changes, or want to level the playing field just don’t have that kind of lobbying power.  And so what we’re really watching here is a David and Goliath story of monumental proportions.”

2. Be honest and transparent in communications. Yes and no. Frankly, a lot of transparency has been forced on the industry. A top example is the Credit Card Act of 2009. How much stupidity, pain and suffering could have been avoided if consumers had seen what I just saw on my Visa bill–that it would take 16 Years!!! to pay off my account if I paid the minimum each month. Why didn’t any single institution think of this themselves? Thus, my skepticism.

3. Focus on quality, not quantity, of communications. Maybe. Banks like to measure things. If they really listen to their customers (and Bank of America gets kudos here), they may realize that they make more “noise” than they need to. Less can definitely be more.

4. Spend less time pushing product and more time providing service. This is the crux of the matter. If banks do this, much of the other problems will retreat into the background. It’s going to be hard to do and it will take time because banks are filled with product managers and sales people, all with individual goals, and frequently a culture that rewards speed and volume over one to one marketing and personal relationships.

5. Engage customers and employees alike. The financial meltdown and the visibility of banks as major contributors to the problem has had a major impact on employees. If they don’t feel good about the company they work for, how can they be expected to engage customers? Banks have the power to do this, but do they have the will?

Only time will tell. My guess? Banks will behave less badly, at least for the next few years.

Ouch! Banks Get Skewered In Latest Edelman Trust Barometer

Went to a breakfast presentation this morning, held by the FCS.  The subject was “The State of Trust in Financial Services 2010”.  Let’s face it, I didn’t expect that the content would be upbeat. It was not. But the subject is interesting and provocative and the speakers were very good.

The core of the presentation was the Edelman 2010 Trust Barometer survey. This past year, the survey, for the first time, did a deep dive on the financial services industry. The findings show that when all categories (NGOs, Business, Government, Media) are combined, the level of trust in institutions tends to track with the S&P. Trust levels overall have bounced back from the 2009 lows by an average of 18%. Not so for banks–trust in banks continues to decline.

What does “trust” mean in the context of the survey? It means the ability and willingness of a company or institution to “do the right thing”.

Tech companies are the most trusted, according to Edelman. The worst? Financial Services.

The drill down allowed for segmentation within the Financial Services industry by type of company. Community and regional banks rank highest, and private equity firms are lowest, even worse than investment bankers.

So what’s the industry supposed to do?

1. Stop fighting with regulators, and work with them for a change

2. Be honest and transparent

3. Focus on quality not quantity of communications

4. Spend less time pushing product and more time providing service

5. Engage employees and customers alike

I will provide my point of view on these in my next post.

From Comcast to XFinity–What Was the Strategy?

Many critics have undoubtedly spoken before me, but I need to add my name to the chorus. Renaming a corporation is probably the hardest thing to do in the world of branding, but that is not an excuse for a poorly constructed name, like XFinity.

In fact, Time magazine has recognized it as one of the top 10 worst corporate name changes.

Let’s begin with the facts.

1. The Comcast brand has been a lightning rod for ill will as well as the butt of jokes (thanks to the infamous YouTube video of the sleeping Comcast installer)
2. The recent acquisition of NBC from GE is the kind of event that merits a full examination of the corporate brand, in order to determine the potential “stretch” of the acquiring company into a new category
3. Research may have shown that the current name is too strongly linked with cable and internet, and that newer offerings, such as pay-per-view, are unduly overshadowed. For example, did you know that Comcast owns Fandango and Daily Candy…or the Philadelphia 76ers?

In my opinion, there is pretty strong justification for considering a name change. But how they got to Xfinity, I do not know. Then again, maybe I do. If the Marketing executives at Comcast spoke to the major corporate identity firms, they probably learned that naming is a time consuming, expensive business and a legal nightmare to boot. Or maybe they retained a firm that was unable to come up with a name that everyone liked, or could be legally cleared without significant expense. (I always warn my clients that naming will break your heart. The best name is virtually always taken.)

The clock was ticking, and Comcast wanted to make a statement and an event about the addition of the NBC properties to its portfolio. As it so happened, the name XFinity was already owned by Comcast–due to the beta launch of something called “Fancast Xfinity”.

Three aspects of this name are seriously troublesome. First, it is awkward to say. Anything that begins with an X is daunting.

Second, X is often a shorthand for pornography, or sexually explicit material.

Third, to anyone who spends time on linguistic matters, the symbolism of the letter x is quite negative. To wit:

To remove or invalidate by or as if by running a line through or wiping clean. annul, blot (out),cancel, cross (off or out), delete, efface, erase, expunge, obliterate, rub (out), scratch (out), strike (out), undo, wipe (out). Law vacate. See continue/stop/pause.  Source: Thesaurus

So if “Finity” is supposed to represent the concept of “infinity”, then the X cancels it out. If “finity” is supposed to mean “finite”, then the x cancels out the finite and I guess it becomes “infinity”. It’s essentially a double negative.

A new name has to work hard enough as it is without having to counteract hard-wired negative dimensions. If you throw enough money at it, I guess it will become less obnoxious with time, but it’s going to be one of those names that will always rub me the wrong way–like SYFY.

Brand Advocacy the Apple and Amazon Way

Sometimes I get tired of seeing Amazon and Apple at or near the top of various brand rankings. It just seems like a cliche. So I received a much-needed jolt of reality this morning on my morning commute.

I was reading Groundswell on my Kindle. As the train reached 125th St., I noticed my seatmate looking at me. That usually means that the person needs to move past and exit the train, so I asked him if he was getting off. He said that he was actually looking at my Kindle and that it reminded him of his wife’s recent experience with her Kindle. Apparently, she was reading while exercising, and dropped it. Although the device didn’t shatter, the side controls were loosened, and her Kindle was unusable.

Hoping that it might be repairable, she called Amazon customer service. To her amazement, the Customer Service rep said not to worry–just mail the broken Kindle to them, and they would replace it. Two days later, her replacement arrived, with all of the books in her original Kindle intact. My seatmate and I agreed that Amazon was quite generous in their terms.

(In fact, I was curious enough to check out the Kindle warranty on the Amazon site. It is quite open to interpretation, and customer service would be within their rights to claim that dropping it on a treadmill or elliptical machine wasn’t covered in the warranty.)

Continuing on the subject of great customer service, the same gentleman began talking about a similar experience with the Apple Powerbook that he purchased for his college bound daughter. The laptop arrived the week before she was to head off to school in California. When she turned it on, it was clear that something was very wrong with the hard drive. It was now Friday afternoon, and she was due to leave in five days. Her father called Apple customer service in a bit of a panic.

Again, the customer service rep was totally reassuring. The rep informed the father that someone from DHL would arrive at their home by 6:00 p.m. with a box that would fit the laptop, that he ship it back to Apple, and that a replacement would arrive by the following Tuesday. The father emphasized to the rep that his daughter was leaving for school on Wednesday morning, so there was no margin of error.

Sure enough, the laptop arrived on Tuesday as promised. He said that this experience alone persuaded him that a Mac was worth the large price differential over a comparable Dell or HP.

By now, we had arrived at Grand Central Terminal. As I walked to work, it occurred to me that my seatmate is a genuine advocate for both Apple and Amazon. Customers like this is what all companies yearn for. What made both of these examples so great was that it had nothing to do with “features and benefits”. What drove his loyalty to these two technical devices was the interaction with human beings in customer service.

All the brand strategy, advertising, brochures, cool websites in the world cannot improve on the personal interaction with a brand. It is clear that in a purposeful way, both Apple and Amazon create engaged employees. Engaged employees are infectious in the best possible way–they pass along their infection to customers.

My hat is off to both of them.

Branding Brilliance from Mary Kay

My daughter and I were on a drive for a college visit. I was in the center lane of a three-lane Westchester County parkway. Before I knew it I was passed on the left by a most unusual SUV. At first, I thought that the sun was affecting my eyes, but, yes, driving along in distinctive splendor was a pink Cadillac Escalade.

My daughter gasped and said, “Is that a pink car?”. “Yes”, I replied, “it belongs to a super salesperson for Mary Kay”. Susannah immediately asked whether anyone could buy a car that color, and my response was that it was unique to Mary Kay.

I had always heard about the pink cars, but had never seen one. I had assumed that they would be awful-looking, but that was the wrong assumption. Pink the Escalade was, but it was tasteful, and believe me, it stood out from every other car on the road. It conjured up so many positive attributes as well:

• Cadillac is an American car, and Mary Kay embodies the American dream. Good for her for not handing out a Lexus to her top salespeople
• Pink is Mary Kay’s signature color, and this particular shade was so special that it remains in my mind over a week later
• This is a business that encourages and–better yet–rewards the entrepreneurial spirit. Whoever was driving must be an incredibly successful person and clearly an advocate for the Mary Kay brand

All of those associations came crowding in within seconds. Although there was a discreet “Mary Kay” on the rear of the vehicle, it was unostentatious. Bravo!

Mary Kay doesn’t advertise. It is sold on a one-to-one basis. I have no idea how to calculate the collective impressions each time the vehicle is seen in the area, but I bet it’s worth a lot.  You gotta love the clarity of purpose and creativity behind this program. And my guess is that it grew organically, not as an overt way to “raise awareness of the brand”. Mary Kay was a woman ahead of her time in more ways than one!

The Ten Brands I Give Thanks For

It’s Thanksgiving day, and although it sounds frivolous, I have spent the last few days thinking about what brands I really care about, that make a positive difference in my life, and that perform against higher standards than most. This is highly unscientific, personal, and random. But these companies make products that drive preference–mine at least–and stay the course in an increasingly crowded marketplace.

You will notice that the cool advertising is not  the reason these brands have been chosen. Cool advertising–or any advertising–is not the same as a brand. The same goes for the logo.

The list is in alphabetical order:

American Express For not recklessly pursuing the sub-prime market. For the wonderful Platinum card, which has earned every penny of the annual fee by giving me access to airline clubs on bad travel days. For retaining the original card member year on the face of the card.

Apple For gorgeous design, intuitive controls, and perfection in packaging. For not selling out to Intel’s co-branding dollars and keeping its advertising clean and distinctive.

Bergdorf Goodman For not contributing to the homogenization of the world and maintaining its one, spectacular and historic location. For merchandise that you can’t get elsewhere.

Felco For the best pruners in the world, in all sizes. 15 years and counting.

Google Voted in by my daughter, “because it answers all her questions,” and it’s hard to argue that. Besides, it isn’t afraid to take the logo out for a walk now and then. All I ask is that they stick with their mantra, “Don’t be evil”.

Hershey* For giving new meaning (or the original meaning) to “corporate social responsibility”. For employee retention and loyalty that few can claim. For staying true to its roots, even in extensions like the amusement park and hotel. *If they buy Cadbury and mess with the Trust, they are off the list.

Martha Stewart The brand, not the person. For inspiring me to get back in touch with my inner crafter, and make my home a better place. For an unerring eye for color, composition and quality. For products that are manufactured to high standards.

NPR For miraculous programing that brings a fresh face and point of view to whatever it covers. For Car Talk, Wait, Wait, Don’t Tell Me, Jonathan Schwartz, An American Life, all of which have kept me in my car long past the time for me to get out.

Olay For reinventing itself from an obscure, old lady brand, to a well-priced, well-researched, line of skin care products just before the recession hit. Well done!

OXO For changing forever the experience of peeling a potato–in other words, ergonomic innovation. For standing out among all the endless kitchen tools.

The minute I finish this post, I will undoubtedly come up with other winning brands. I’ll just keep them until next year.

How about you?

College and University Branding

I am the proud mother of twin daughters, who happen to be in their senior year in high school. Anyone who has gone through the college search process in the last few years is well-aware of the marketing prowess demonstrated by even the most unknown colleges. If you haven’t experienced it, you would be amazed.

Some of this we brought upon ourselves. As neither daughter seemed to comprehend the importance of good grades, we began visiting colleges after their freshman year–hoping to give them an inspiring glimpse of why exactly they were in college prep schools. Those first tours did not have the desired effect. In fact, they might have boomeranged. But not surprisingly, those early schools began to contact us regularly. Impressive follow-up.

Then my husband discovered the book, “Colleges That Change Lives“, which is a cottage industry unto itself. The book is terrific, uncovering some of the best, smaller schools that connect with their students in meaningful ways. The book came first, then the schools seemed to capitalize on it, and thus a specialized college fair was born. My husband and daughters attended one, and at the Cornell College booth, the recruiter knew of their great-aunt Geneva, who had been an renowned English professor there for 40 years. Then they visited the Ohio Wesleyan University booth, where the recruiter had been a classmate of my husband’s (back then a ne’er do well) brother, and remembered him well and fondly. Each school was more impressive than the next. Now the girls were starting to “get it”. What is so interesting about this group of schools is that they have, in effect, created a branded class that in total begins to challenge the commonly accepted top tier of schools.

As a brander, I applaud them. As a mother, I realized that many of them were beyond the academic reach or geographic interest of my daughters. And so we continued to search.

Today’s college fair (if you live near a large city) is an amazing experience. It’s like a trade show, but what is interesting is that everyone plays on an even field. Each school has a table. What they do with their table is up to them, but there is no change to create a fancy two story, over the top, booth. Business could learn a great deal from the “sales” efforts of the recruiters. The best of them have attended the school they recruit for, and they provide detailed, insightful and personal information.

Another great resource is “America’s Best Colleges for B Students“. It’s not as rigorously researched as CTCL, but there is helpful information about how and where students may access academic support and get the tools for success. We found several intriguing schools, some of which cross-referenced with CTCL, which made them even more interesting.

The best schools understand how 17-year olds today communicate, which is not always in a formal interview or a formal essay. Most have FaceBook pages, and they communicate via email–and direct phone calls. Again, this is evidence of total focus on the target audience.

We are far from done. What were the memorable experiences? High Point University, whose president is a businessman who has both a vision and a deep understanding of marketing. It may look glossy, but it is not fluffy. A surprise finalist is McDaniel College, which is both a CTCL and a “B Student” school. The information session purposely had no fancy PowerPoint or video, just an incredibly intelligent and articulate representative who focused on the school’s commitment to the holistic education of each student. Instead of being put off or intimidated by the academic excellence, my daughter found herself challenged and insprired by it. Bravo!

Right now, we are in the thick of it. The phone rings nearly every day with a recruiter or student representative from a college. Our mailbox is overloaded with post cards and brochures.

If you are a marketer, just think of the challenge. There are the Ivies, the Big Ten, the major State Universities. But there are thousands of schools under the radar, all trying desperately to stand out from the pack. The best have a deep sense of who they are, their heritage, and their vision for the future. The remainder have bought into expensive marketing communications programs, but they still have far to go. As many people say, “There is a college for everybody.” Some make their case far better than others.

G.M. Yet Again–Thoughts on Brand Architecture and Corporate Branding

GM recently announced that it will remove its “G.M. Mark of Excellence” logo from all car models.

Let’s see. By my reckoning, it took about 4 years (2001 to 2005) for corporate to persuade its individual car brands to attach the supplemental logo to its cars. It stuck around for about 4 years (2005 to 2009). We will see what they do four years from now. My bet is that it stays off.

What went wrong? This is a case where the intentions were good, but perhaps not fully thought out.

As I have said before in other posts, GM is a “holding company” structure. This is totally different from any other car company, because all of the rest of them share a model name with the corporate parent. 

My guess is that GM was reacting to Ford’s “Quality is Job One” campaign, and wanted to make a similar claim. It may also have wanted some economies of scale in advertising–promoting different marques in the same ads. 

But no matter what GM’s “corporate brand” message may have been, there was no real way to reinforce it visually. Well, actually there was a way. They could have created one master template for all collateral material and showroom signage that made GM more prominent. Then they would have needed to pour a lot of money into it. Not a likely scenario! So, they created a (relatively) tiny logo to be placed on all vehicles. This undoubtedly caused consternation among the different car brand managers and designers in terms of where to put the darn thing. Nowhere prominent, that’s for sure! A car with two logos just makes no sense.

As far as I can see, the only role for the GM corporate brand is among shareholders, employees, government officials, and the media. That’s the way it’s supposed to be when you are a holding company. Since GM is the only such automotive company with that structure, it must be kinda lonely out there.

Hooray for Kashi

There is a lot to admire about Kashi, both the company and the individual products. 

I was in the grocery store recently, and was impressed to see that Kashi is starting to have some real shelf impact. The cereal variety has expanded and I saw their pilaf in the rice section for the first time. And their products taste good, too.

That’s not unique, of course. Many companies can make the same claim. What is brilliant is the clarity and consistency of their positioning and message: “7 Whole Grains on a Mission”. In a world when companies want to be all things to all people, and wordsmith their messages to death, Kashi is refreshing by comparison. 

Their packaging is attractive and clean, but far from generic. They are obviously focused on healthy eating, but not as lecturers and finger-waggers. Instead, they reflect health infused with fun. The website is simple, easy to navigate, focused on people, community and environment. The tone of voice is modern, straightforward, human, young. They are quite transparent in terms of ingredients and nutritional analysis. So it’s a nice balance of style and substance.

Here’s where the going may get tough, though. How successful can–or should–Kashi become? How many product extensions are in the works? Here is the boilerplate that they use in their press releases:

As a pioneering health food brand, Kashi is dedicated to providing great

tasting, healthy and innovative foods that enable people to achieve optimal health and

wellness. Its products are natural, minimally processed, and free of highly refined sugars,

artificial additives and preservatives.

 

So far, so good. Yet, they are moving into frozen foods, like pizza, which may be pushing the envelope a bit when it comes to the ingredient list. 

 

But compared to what else I see in the supermarket these days, Kashi has a big leg up. They are more expensive than the usual highly processed, sugary cereals that dominate, so it will be interesting to see if their message outweighs the current trend to pinch pennies. My bet is that Kashi will continue to grow. My hope is that they don’t grow too much.