| Welcome to
our newsletter for August - September 2004.
This issue focuses on brand naming (looking
at some key principles and guidelines),
and gaining consensus on metrics within
the marketing profession.
Please forward this newsletter on to colleagues
and friends who may also find it of interest.
As always, we want to ensure your continued
interest in receiving our newsletter - so
if you wish to unsubscribe, please email
us at: info@davismarketing.com.au.
Dianne Davis
Principal and Managing Director
www.davismarketing.com.au
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24 |
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ITEM
1: Brand Naming –
Do’s & Don’ts
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| In recent years, the
professional and financial services sectors
have seen a flurry of new brand names enter
the market (Bearing Point, Promina, Apogee,
Vero, AXA, Acuiti Legal, Accenture), several
that barely and nearly saw the light of
day (Braxton, Sagitta and Monday) and a
number of established brands that were amalgamated
(Allens Arthur Robinson, PriceWaterhouseCoopers,
ASX Perpetual, Goldman Sachs JBWere).
In our brand consulting work, we find people
have very clear and strong views on specific
brand names; however, putting personal preferences
aside, there are some core principles that
should underpin brand naming.
In selecting a brand name, there are six
principal categories to choose from:
Descriptive:
Describes the function literally (e.g.
Singapore Airlines, The Securities
Institute of Australia, Telecom New
Zealand, Mortgage Choice)
Suggestive:
Suggests a benefit or function (e.g.
ShopFast, FedEx, First Direct, SmartChat,
Comfort Inn, Ever Ready)
Compounds:
Combination of two or more words (e.g.
Bearing Point, PriceWaterhouseCoopers,
Allens Arthur Robinson)
Classical:
Based on Latin, Greek etc (e.g. Veritas,
Vero, Oracle, Epiphany)
Arbitrary:
Real words with no obvious link to
what the organisation actually does
(e.g. Amazon, Egg, Apple, Yahoo, Orange,
Virgin)
Fanciful:
Coined words with no obvious meaning
(e.g. Accenture, QANTAS, Promina,
Westpac, Optus, AXA).
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Based on the work of recognised brand name
expert, Naseem Javed (ABC Namebank),
there are eight key principles underlying
effective brand names:
- They should be easy to learn and remember
- Be mindful of how people may pronounce
it / how it sounds
- It should be distinctive and not confused
with a competitor’s
name
- Where possible, it should suggest your
product category, so the
brand has recognition / recall within
it’s market and is
relevant to your industry (this is certainly
the case for
organisations with limited budgets who
can’t afford large and
sustained campaigns to build awareness
and understanding of
a new brand name)
- It should evoke positive and desired
associations
- Conversely, it should not evoke undesirable
associations (e.g.
what is the translated meaning / literal
meaning of the name in
other languages; sometimes the name doesn’t
mean anything
offensive, but it sounds as if it could)
- Apply the “24 hour” test
(how does the name sound in the cold light
of day; would you in fact be proud to
say you worked for XYZ firm)
- Importantly, it must be available and
legally protectable.
In addition, according to Javed, there
are three further golden rules:
- Don’t copy others
- Don’t get too creative
- Select names that will have broad appeal.
In adopting a new brand name, a number
of strategic and operational considerations
need to be taken into account:
- Where appropriate, leverage the “equity”
that resides in the existing name (your
history and heritage) yet – at the
same time – move the brand forward
(stay relevant)
- Choose a name that will support future
expansion / growth (e.g. sub-brands, co-brands,
product brands)
- Can you legally get it – in the
era of domain name bundling / ecommerce,
thousands of names have already been taken;
indeed, something like 70% of all words
in the English language have been taken
- Effective internal “buy-in, communications
and education – before going external,
employees need to understand the rationale
behind the name change, key attributes
associated with the new name, and their
role in explaining and communicating the
name
- Ensure the new brand name is adopted
from launch day across all communications
and client touch points (e.g. collateral,
stationery, signage, website, email addresses
etc)
- Measurement - determine the effectiveness
of the re-branding exercise (both internally
and externally).
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ITEM
2: Building Consensus
on Marketing Metrics
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| In the last five years,
the marketing profession in Australia and
internationally has increasingly recognised
that the development of a metrics framework
(note framework rather than prescriptive
measures) is central to reclaiming marketing’s
influence, strategic role and contribution
within organisations.
Such frameworks need to build in sufficient
flexibility to reflect the needs of different
industry sectors, organisation size and
business strategies.
At the same time, it is acknowledged that
there will be metrics common to certain
industries and business strategies.
Core
Metric Categories
A review of more recent literature
on marketing metrics highlights agreement
that a framework should include three
core metric categories:
- Financial (e.g. shareholder value-based
metrics)
- Brand (external and more latterly,
internal)
- Customers.
(Within each category, more specific
metrics would be applied – from
which organisations would select an
appropriate mix, in line with their
overall business strategy, and brand
positioning and customer relationship
strategies).
Tim Ambler (“Marketing
and The Bottom Line”) adds
a further two metric categories –
“Employees” (employee
satisfaction, employee retention etc)
and “Innovation” (appetite
for learning, no. innovations launched);
while Lukas, Whitwell & Doyle
(Marketing & Shareholder Value)
add “Strategic Relationships”
(alliances, JVs) and “Marketing
Knowledge” (IP, systems, tools
etc).
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Balance
Between Non-Financial & Financial
Metrics
A further basis for agreement is
that a metrics framework should achieve
a balance between non-financial
metrics that provide a picture of
what is happening in the marketplace
(brand, customers) and financial
metrics (e.g. shareholder value
approach = evaluating marketing assets
in terms of their capacity to generate
cash flows with a positive net present
value).
Put another way, the value generated
by marketing should be measured in
terms of the value it creates for
both customers and shareholders. While
the two are clearly interrelated (shareholder
returns are indeed based on generating
value for customers), the metrics
and methodologies employed by the
two differ.
Customer value is based on a cost/benefit
ratio, which, in turn, is based
on the performance of a company and
/or its brand. Performance is measured
by the outcomes of products, services
and the customer experience. Specific
brand positioning and customer strategies
determine the choice of individual
metrics.
While, shareholder value is based
on ROI (as demonstrated by
discounted cash flow).
In this part of the metrics framework,
certain marketing activities / expenditure
can drive market-based assets (e.g.
brands), resulting in certain market
outcomes (e.g. market share), which,
in turn, impact the amount, speed,
duration and risk of cash flows.
Metrics relating to cash flow need
to:
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a) |
reflect the chosen business
strategy |
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b) |
be based on an understanding
of what marketing actions drive
key market-based assets |
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be based on an understanding
of the relationship between
actions and market-based outcomes |
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be expressed in cash flow
terms. |
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Putting
Shareholder Value into Perspective
However some academics (Ambler in
particular) warn against too much
stock being placed in shareholder
value; it is , they acknowledge, effective
in managing and “squeezing”
assets and costs (including marketing
costs), but limited in it’s
ability to explain what is happening
in the marketplace, where current
and future cash flows come from, or
how cash flows can be increased.
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The
Future
Over the next six months The
Marketing Coalition (a forum
representing the major marketing industry
bodies in Australia), will advocate
a common framework for marketing metrics
and communicate a shared vision for
the Australian marketing profession
(and wider business community) in
relation to marketing measurement.
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ITEM
3: Davis & Associates
forms strategic alliance with
Perks Design Partners – Perks
Davis
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Respected brand identity group, Perks Design
Partners, and Davis & Associates, are
joining forces in a strategic alliance –
Perks Davis, to offer for the first time
in Australia an integrated brand strategy
and brand identity capability, specifically
focused on the financial and professional
services sectors.
The two companies have already successfully
collaborated on a number of projects, including:
- the re-branding of Acuiti Legal (which
was chosen as the branding
case study by AGSM in 2002 for their MBA
program)
- the repositioning and re-branding of
financial services education
group, Tribeca Learning (voted BRW’s
fastest growing company in 2003)
- the brand positioning of national mid-tier
accounting firm,
Bentleys MRI.
Both parties bring substantial financial
and professional services expertise to the
alliance, including (in addition to the
above- mentioned projects), work for: Mallesons,
Gadens Lawyers, Sparke Helmore, KPMG, Deloitte,
Baker & McKenzie, St.George Bank, Arnold
Bloch Leibler, QBE, Commonwealth Bank, ASX
Perpetual, Mortgage Choice, ABN AMRO, Herbert
Geer & Rundle, Gilbert + Tobin, Beerworth
& Partners and The Securities Institute
of Australia.
Both companies will continue to operate
as separate entities in their specialist
fields, but will combine expertise, experience
and resources on integrated brand strategy-brand
identity projects.
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ITEM
4: Appointment to
ParaQuad NSW Board |
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| From July, Dianne
Davis will join the ParaQuad NSW Board as
a Director.
This follows a brand positioning project
Davis & Associates undertook for ParaQuad
NSW in October-December of 2003.
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ITEM
5: In the News |
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| Dianne Davis had a
contributor piece on law firms and tendering
featured in The Australian Financial
Review (16 July 2004). To view the
article in full, go to "In
The News" section on our website.
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| NEXT
ISSUE: OPTIMISING THE ‘MARKETING PARTNER’
ROLE IN PROFESSIONAL SERVICES FIRMS
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