The news this past week was interesting again for those who follow brands. My previous blog entry included a mention of Apple and its new iPod line, featuring the iPod Touch. One of my students asked whether Apple should have waited to launch this product, especially given the recent launch of the iPhone (both products share similar touch screen interfaces). It is a good question, which leads me to 2 others: does the iPod Touch dampen or dilute the iPhone before the latter gets firmly placed in the market; and is Apple rushing out more products faster and hastily than in years past? While we won't know the financial impact of these new iPods for another few months, Apple's management is making shrewd competitive moves in my opinion. We've seen Apple orchestrate big launches over the past 10 yearsf, from the first new iMacs to the iPod and now the iPhone. But in between these launches have come numerous smaller launches (I hesitate to call them updates as that implies something small and insignificant, and even Apple's updates are big deals), including 3 new iMacs, the partnership with Intel on the CoreDuo Processor, the Tiger operating system, several variations on the iPod (Nano, Shuffle), MacBookPros, AppleTV, and its iWeb and iWork software suites. As each product launches, Apple sunsets-out previous versions, keeping the product line relatively trim and focused. While innovative design is a key differentiator of Apple's, so too is the 'tidiness' of their offerings...it never looks too crowded. The consumer market is moving faster than ever, so Apple is ensuring that it stays on par with expectations that it deliver innovative products regularly. This applies to the iPod Touch, which leverages the momentum begun with the iPhone, rather than distracts and, most likely, also suggests where the iPod line may be moving in the future. So I think the iPod Touch is a good, flanking move that reinforces the strengths of the iPhone and begins to carve out a highly differentiated market position against other MP3 competitors, whose offerings look increasingly bland and generic....
Nike just announced a 51% increase in 1st quarter earnings following strong performances around the world, led by Europe and Asia. CEO Mark Parker commented that the company is on target for achieving revenues of $23 billion by 2011. When I left Nike to start a boutique hotel company in the 1990s, the company's revenues were around $4 billion. As it climbs past $16 billion this year, the company now has 30,000 employees and has an enviable brand reputation. What is driving this success? A number of factors, including Nike's historical emphasis on innovation (right now it is the new, low-profile footwear and its innovative cushioning) as well as management's reorganization around 6 core sports. This reorganization did not eliminate Nike's other product categories, instead it allows the company to build around the sports with the biggest global impact, from which smaller sports categories will be able to leverage more niche-oriented opportunities. At the same time, Nike indicated that its Bauer Hockey brand will probably be sold because an internal brand audit indicated that this particular business was not in line with the company's future growth areas. Such internal reviews (brand audits) are a critical tool for management to evaluate current and future opportunities, as well as the company's capability to develop the business. Visit the investors section of Nike's website and watch the videos (there are several) of CEO Mark Parker and Chairman/Founder Phil Knight as they discuss the company's financial performance and future direction. While such videos are effectively visual press releases, Parker's and Knight's comments do accurately reflect Nike's culture and company philosophy and hint at why the company is so successful in the global athletic industry. Their comments are virtually identical to what I heard when I worked there: a relentless drive to succeed; an optimistic view of the future and of human potential; a belief in sports as a force of good in the world; a commitment to authentic products designed first and foremost for athletes. Nike has always been a passionate company filled with hyper-dedicated people who love sports and this intensity of focus is a key reason why the company is so dominant in its industry today. Parker's and Knight's comments are genuine, not false bravado or hype...so if you want a glimpse into this company, then watch the videos....
Google has launched a new tool for brand marketers called Google Gadget Ads, which follows on the heels of the company's launch of its innovative AdSense. Essentially, Google Gadget Ads are rich media display ads in which companies can use video, animation, newsfeeds, and maps to market their offerings. With the web becoming the defacto hub of choice for consumers, these new ads may well make the web even more interesting. The ads are user-activated, allowing the user control over how they experience the web...
BrandWeek had an article this week highlighting Mercedes', BMW's and Volvo's new efforts to market 'lower luxury' products--affordable luxury cars, in essence. Each is supporting these new cars with sizable brand marketing campaigns using cross-platform advertising such as TV, innovative webcasts and an aggressive 'test drive' campaign. It will be interesting to see how these new cars sell--stretching brands downward is certainly a way to attract new, up and coming customers. The downside is whether the core brands are harmed over the long-term. Obviously, these car makers are betting that they can reach consumers with future potential who will ultimately trade-up as they become more successful.
