Will FIFA World Cup 2018 Help Establish the Brand “Vivo”?

Vivo, the third largest Chinese smartphone manufacturer after Huwaei and Oppo, has been aggressive in branding itself through FIFA World Cup 2018 and 2022 sponsorships. It is of no surprise that Oppo and Vivo follow almost similar branding strategy as they are from the same manufacturer (BBK Electronics). Ever wondered why didn’t they adopt significantly different strategy for two different brands? Keep guessing! The fact is both Oppo and Vivo boasts about their selfie expertise, focuses more on offline sales through higher margin to retailers and keeps widening their distribution coverage by opening stores in rural or semi-urban areas. Oppo is an older brand (established in 2001) compared to Vivo (started in 2009), and already appears to be more popular than Vivo. Perhaps that could be one of the reasons why Vivo was chosen for a facelift instead of Oppo by its parent company (?). No matter what, the increasing reach of Vivo by expanding its distribution outlets is a sign that Vivo is getting ready to get a boost through FIFA World Cup 2018 (and 2022 as well).

It is interesting to know that almost half of the world’s population enjoys this seasonal exhilaration. No wonder that it is an opportune moment to reach a brand’s target audience. Vivo just did that by becoming the official smartphone of FIFA World Cups. The question is, will the result be sustainable for Vivo?

Branding is not merely about advertising and sponsorships, it is about letting people have the passion for Vivo in such a way that customers feel, think, talk and walk Vivo. Branding has to be from within the core of the passion, and not a superficial love story that plays like a full-length movie. Interestingly, if you search Google and find what people are talking about Vivo, you would be surprised to see the flurry of positive and negative comments they are sharing on their experiences. Most likely, it means Vivo has to work on its functionality and many other factors as customers are not unanimous on what Vivo means to them. Of course, there are certain popular models that are rated more positively than others, however, a unified stand of customers’ perception of Vivo appears to be missing. Prove me wrong if you are a fan of Vivo!

At this stage, beating a drum louder for Vivo may actually harm the brand in future, if they are targeting the global audience. May be, it is too early to comment. The interesting phenomenon of rapidly growing Chinese domestic market could be another factor that Vivo must have weighed in. With its expanding rural retail network in China, World Cup sponsorship would probably spark an uprise in Vivo’s demand domestically that could prove to be enough for Vivo to establish itself as the number one brand in China. The rest of the world can wait for some more time before Vivo can come up with better solution in 2022!

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Lessons Learned from the Closure of Toys ‘R’ Us

Finally, the giant toy-retailing chain store Toys ‘R’ Us is closing. Operating over 60 years across the US and Europe, nearly a thousand of its stores are now being closed as the company could not make enough money to continue its business.

A number of lessons can be learned from its retail operations that saw an end recently. First, it could be noted that the peak business period of the retail chain was seen during the early nineties, when brick-and-mortar stores (or physically located stores) were (still) dominant over e-commerce stores. The tide slowed down when other low-price retailers (like Walmart) started selling toys in the late nineties, along with increasing competition from e-retailers. Second, in this backdrop, the company ran into a sort of financial burden, as it has been paying about US$400 million in interest, accruing on its debts every year, mainly due to its $6.6 billion leveraged buyout in 2005. It appears that, at the end of 2017, it almost succumbed to its debt burden. Evidently, financial burden would not have been a problem if the debt could be serviced satisfactorily through brisk business.

The lack of brisk business could be attributed to two main reasons. First, other retailers, including small community toy stores, started selling low-priced toys that pulled the Toys ‘R’ Us into a tough competitive space. In addition to low prices, those retailers also ensured amusing experience for shoppers and children. Does it show that we need to care about customer experience to stay in the business? Of course, yes. How about e-retailers? Yes, they are the reason number two. The proliferation of Amazon and other e-retailers appeared to have caused significant blow to Toys ‘R’ Us’s business. It is not surprising that whatever can be bought from Toys ‘R’ Us, can also be bought from online stores at ease.

It has been surprising to see how Toys ‘R’ Us still believed that the brick-and-mortar business model could win business over e-commerce and small community toy stores in the long run!

 

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Branding using boundary-breakers

Most brands are stuck in their imaginary boundary these days. It means, in the name of consistency, they are “improving” upward within their boundary, but not going beyond where they are, being afraid that it might hurt their positioning. The notion of “core competency” could be another way to look at this myopia. While there are some theoretical truth that you must be consistent in your positioning, it is also true that boundary-breakers like Tesla and Apple are moving beyond where they started. The core competency of Tesla did not “pre-exist”, it was “created” through aggressive investment in R&D. And Space-X did not come from the space, it was a boundary-breaker beyond what was possible by the space industry. It is amazing to see how these boundary-breaking  thoughts could be the sources of your next innovative brand. Other than “vitaminizing” your dying brand, think about some boundary-breakers now!

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Inspiration and Perspiration: How Brands Make their Mark

It takes a lot of imagination to put a creative mark in your branding program. Subsequently, it takes a group of front-end soldiers to make a brand’s dream come true. Both are important, one cannot be achieved without the other. But it is the inspiration that ignites the fire to burn the trail. In addition, it is the hard work (perspiration) that executes the dream in the market. A creative plan can fail because of poor execution. On the other hand, a poorly designed plan can get away with a wonderfully crafted execution, although chances are there that it would most likely fail to put a significant mark. We often put less attention to execution whereas we put more importance on crafting a dream. For a successful brand, it requires the both. What do you think?

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Are brick-and-mortar stores coming back?

Those who are thinking that physical presence of a retailer is no more needed, think again. While this is true that many brick-and-mortar stores are no more profitable to operate, there are ways how a firm may capitalize on this classical form of retail stores. This is particularly true when we are talking about high-end brands offering some unique experience through their physical presence.

How about Apple operating in over 18 countries, comprising of about 495 stores? And some of them are offering in-store classes for customers, dubbed as “Today at Apple”, where hands-on teaching sessions and demonstrations are being offered. Not to mention the personal touch in services when you visit a brick-and-mortar store and talk to an employee while looking around gadgets that interest you. Online stores are a bit impersonal and void of emotion, aren’t they? Oh, what is going on with Amazon this year with their first ever brick-and-mortar book store in New York? How about Amazon Go experimental brick-and-mortar store selling products to customers? Are we talking about sophistication, class and emotion when it comes to classical retailing? Probably yes. This trend has been seen in the global retail industry for the last couple of years and more retailers are joining this classical bandwagon. Let us keep an eye on this trend and see how customers respond to this changing landscape of “modern” retailing.

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Mending Customer Relationship: The Apple Way

Apple is probably one of those few brands whose older models are widely used and popular among its customers. One reason could be that the newer models might be expensive to a section of existing Apple users, so they switch to new models whenever the time is right for them. Another reason could be the durability and usability of older models that might prevent them from switching to newer models until they feel it is time to buy a new phone. According to a report, in 2012, about 15% of global iPhone users had Apple models that were two years or older, and the figure is steadily growing over time. It was projected that the figure could reach as high as 35% by June 2018. No wonder that the battery grows older as the phone ages, and battery issues would pop-up in older phones even though core functionalities may not.

Yes, this is what already happened with older iphones with weakened batteries. The company, in its version of an acknowledgement, said that recent updates to operating system could slow down iphone’s performance in older models in order to handle weak battery issues. Results? We see angry customers who are alleging that their phones are slowed down not because of battery issues, but because the company wants them to switch to newer phones. Well, both sides have arguments, but the fact is Apple handled the situation wisely and offered battery updates at a much lower cost (US$29) than the original price of replacement (US79$), in addition to an official apology that the updates slowed down older models.

Evidently, they gave customers a good reason to keep their older phones, signaling good intention to continue serving users of old models. It could be an example of sustaining customer relationship by listening to customers’ needs, what do you think?

 

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Uber and NASA: Blue Ocean Strategy with a Click

Here is another market-disruptive initiative from Uber as it partnered with NASA, with a plan to launch “flying taxi” called UberAir. That’s right! Combining software expertise of Uber and Hardware expertise of NASA, it looks like a perfect marriage to enter into the untouched market of this unique service. Uber would be planning for low altitude flying vehicles capable of making vertical take-off and landing. It would provide this unique “air taxi” services on demand, as if you are calling for an Uber-ride by clicking on your app, with the difference that you just want it over air. They are also planning to make it competitively priced for its customers. The trial is expected to start by 2020 in the USA, and the company hoped that it would be fully operational in selected cities by 2028.

terrafugiaBeing a pioneer in ride-sharing services, Uber is continuously differentiating itself with unique and innovative ideas. It is no wonder that the company has envisioned a blue ocean that it can successfully enter and grow, enabling itself with necessary resources and capabilities. The branding efforts are huge and something to learn from. However, the availability of technology and commercialization of the same would eventually challenge Uber as flying cars like Terrafugia and Airbus Pop.Up  would be commercially available for other competing fleets. It looks like the early entrants with right mix of branding efforts would take the market lead. Let us wait for the new frontier to open and see who wins the race.

(photo credit: http://www.terrafugia.com)

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Is Tesla leading the creative disruption in car industry?

Electric car has not been a new concept of this century at all, though Tesla revolutionized the idea with the inception of its highway-legal practical electric cars that can drive over 250 kilometers per charge. Toyota Prius has been experimenting with this segment though, but no sign was evident that they wanted to make it the mainstream highway vehicle. With its aggressive strategy led by Elon Musk, supported by the enabling environment of stricter government regulations about emission and concern for sustainability of fossil-fuel vehicles, Tesla has been able to wake up the rest of the car-makers and let them jump into this bandwagon.

Consequently, Toyota is now asserting that they will phase out all gasoline vehicle models by 2050. Paris will get rid of all gasoline vehicles by 2030. Germany has already passed a non-binding resolution that all gasoline engines be banned by 2030. It all means that the days of petrol and diesel engines are already marked. In this backdrop, Tesla can be considered as a leading disruptor who inspired others to follow the suit. And definitely, every car manufacturer will eventually adopt and enhance this technology for better. Just like market-resilience is a pre-requisite of survival in a competitive world, so is the technology-resilience. It is time to see who adopts and hones this technology for better and grab a better market share.

 

tesla

(photo credit: http://www.tesla.com)

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Artificial Intelligence in Customer Service: A Way to Go!

Artificial Intelligence (AI) has tremendous potential to be used in customer service. In broad spectrum, two modes of this tech infusion can be seen as of today. First one may include customer service robots, along with automated customer service care-sites that can generate customer solutions based on pre-assigned algorithm. Another avenue could be the human agents assisted by AI assets. The good news is that both of these are actually happening now. Customer service care-sites mapped with solutions for repetitive customer complaints are not new. However, the sophistication over time is amazing. Uber has its own AI lab to enhance customer experience that is already being created by using intelligent network.  Google is planning for robot-assisted surgeries. And there are more! Online Chatbots are taking care of many types of customer services like returns and refunds that are reducing customer care costs. With Big Data and analytics taking over intuitive decision-making, full-fledged AI-based customer service will be a reality soon. What do you think?

 

 

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Is Quality at the Center-point of Branding?

Quality ensures performance, which ultimately plays an important role in creating unique identity that we call “Brand”. Performance, on the other hand, does not merely depend on the quality hardware and parts, but also the way the goods (and services) are “designed” or assembled/sequenced in order to deliver a superior experience, leading to perceived excellence in performance.

However, the equation is not as easy as it seems. The technical quality and perceived quality may not be the same always. In many cases, consumers may not be able to objectively assess the level of technical quality, while they only experience the quality that they perceive to exist in a brand. On top of that, the level of price may also play a big role in signaling quality, oftentimes customers assuming that high priced products are always of better quality.

There is no point to argue whether customers’ perception(s) is technically correct or not, it is about how the actual positioning has taken place that matters at the end of the day. In a competitive world as it evolves, no single sure-fire way of communication can guarantee that a targeted image can be created, rather it takes a collection of techniques and executions that would lead to a perceived image that equals the brand promoter’s target. On top of that, as the number of competing brands increases, nobody can survive without ensuring the minimum and acceptable level of quality to customers. It appears that, the competition is not between bad and good brands anymore; it is among good, better and best brands as are defined by customers. What do you think?

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