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Guest Times: Redesigning the H-P Brand

Robert Passikoff, President, Brand Keys, argues why the core brand equity of innovative design holds the key for Apple’s success and why H-P has a lot of hard work to do  October 1, 2012:

Robert Passikoff

There’s a much-watched YouTube bit by comedian Louis CK about someone making a mobile call, who pushes the phone’s ‘call’ button and becomes immediately impatient about how long it takes to get connected. Louis screams, ‘Give it a second, it’s going to space! Can you give it a second to go to space?’ It’s a wonderful example of what’s happened to consumer expectations and how consumers’ hearts and minds really work when it comes to evaluating brands, especially technology brands.

Consumers aren’t always able to rationally articulate needs, desires, or expectations. Nor are they able to assess brands on a purely rational basis. But they do know what they want, and they recognise something that meets their expectations when they see it. It strikes an emotional chord. Zing! go the strings of their hearts – and shortly thereafter, their purses open.

This thought came to mind when we read recently that Meg Whitman, CEO of Hewlett-Packard, as part of her plan to defend H-P’s position as the world’s largest PC maker (at least, currently), was taking steps to make the brand a rival to Apple. And where was she going to take on Apple? Why, when it came to product design! No really. Design.

Design, Apple’s core brand equity We think that it’s fair to say that Apple has both its supporters and its detractors, but the one thing in which virtually all consumers can agree is, when it comes to aspects of beautiful, organic design of technology, Apple is at the top of the technology tree. It’s where their brand equity lies. Brand Keys defines ‘brand equity’ as the degree to which a brand is able to emotionally and rationally meet expectations consumers hold for a product or service category. And when a brand is able to exceed those expectations, we call it ‘core brand equity’, and – no surprise – design is the category driver in a number of technology categories where Apple’s core brand equity lies. You might say it’s the core of the Apple brand.

Anyway, Ms Whitman talking about H-P recently said, “I don’t think we’ve kept up with innovation. The whole market has moved to something that is more beautiful.” Memo to Ms. Whitman: THIS IS NOT A NEW PHENOMENON! Over the past 16 years we’ve tracked category drivers and customer expectations, which have increased by about 24 per cent in virtually all categories, in virtually all aspects of what actually drives engagement, loyalty, and profitability. More in technology categories, including PCs. And, especially as it relates to design.

What drives PC sales? Innovative design So not only can we take a look at how a brand keeps up with category expectations overall, but we can look at individual category engagement drivers – like, say in the computer category – the very first driver (which not-so-coincidently has the highest levels of consumer expectations), Innovative Design. Here’s how the top 5 brands measure up to what consumers expect (the category Ideal being 100 per cent):

1. Apple 92% 2. Samsung 88% 3. Asus 87% 4. Toshiba 85% 5. Lenovo 84%

Where’s H-P? You’ll find them at No. 10 (of 11 brands on the current list) and meeting consumer expectations regarding Innovative Design at only 78 per cent.

H-P has hard work to do So H-P has reorganised and expanded its design team and is hard at work. But two things compound the difficulty of this effort. First, there’s the consumer, whose expectations are never constrained by corporate promises and are growing as we write this, and second, by the increased adoption of smartphones and tablets, delivering against expectations – in some cases creating expectations – are making the concept of the PC redundant.

When it comes to product design it’s been said that people ignore designs that ignore people. Or, more aptly put from a loyalty and engagement perspective, people ignore brands that don’t take into account people’s real expectations.

And by now, brands that do that should pretty much know what to expect regarding sales, revenue, and share.

(Reproduced with permission from www.BrandKeys.com)

(Robert Passikoff, Brand Key’s Founder and President, has pioneered work in the area of  brand loyalty and engagement, creating the Brand Keys Customer Loyalty Engagement Index, the Brandweek Loyalty Leaders List, the Sports Fan Loyalty Index, and the Women’s Wear Daily Fashion Brand Engagement Index. His first best-selling book, Predicting Market Success, provided marketers with a 21st century perspective on predictive loyalty metrics, and his newest book The Certainty Principle: How to Guarantee Brand Profits in the Consumer Engagement Marketplace examines a predictive approach to Integrated Marketing ROI.)

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