Branding My Nikes

I don’t make it a habit to think of my work when I’m jogging. But on a run through the hills near my home a couple days ago, for some odd reason I began to think about my running shoes and my loyalty to the Nike brand. Confession: All my athletic footwear—running shoes, cross trainers, tennis shoes—has been Nike for several years. I’ll tell you why, because I think there’s an important lesson for branding here. My loyalty to Nike has nothing to do with their ads and promotions. It has everything to do with the fact that I can count on (remember that phrase) Nike to provide me with the following: • a great, snug fit for my size 13 extra-narrow feet. • state-of-the-art innovative, constantly improving cushioning technologies that give a better and better support for my fragile lower back. • a quality and durability that will make those above-two features last for the life of the shoeThat’s basically it. The fact that great athletes endorse Nike is nice. The fact that Nike shoes look cool is nice. I like both those features, I admit it. But other shoe providers boast celebrity endorsements and snazzy looks. And while I enjoyed seeing Rafael Nadal wearing “my” tennis shoes in a recent magazine ad, I’d never buy them just because he gets paid to wear his. (By the way, Marian Salzman, the ex-chief strategist at ad giant Euro RSCG Worldwide, has concluded, “People are becoming far less susceptible to the power of celebrities who are seen as shills for a brand.”)For me and my unique needs, I buy Nike because it does a better job on those three critical variables above than any other competitor shoe I have ever tried. I can count on Nike to provide me with ongoing success on those variables, so much so that I am 100% confident of ordering product on-line (which I rarely do with other clothing retailers) and will pay whatever the asking price is. What makes brands great is not their visibility, nor their celebrity endorsements, nor the marketing pizzazz behind them. Remember, during the 1990’s Nike and McDonald’s lost a lot of their sheen (and stock value), despite their heavy promotional strategies and the ubiquity (and near 100% recognizability) of the swoosh and the Golden Arches. Only when both companies revamped their product lines did the swoosh and arches generate a positive halo. Don’t mistake presence and recognizability for corporate vitality. Nowadays, Levi Strauss and Coke are struggling, and as I’ve explained elsewhere (see http://www.ftpress.com/articles/article.aspx?p=1180989), Starbucks' buzz and market cap have fallen—but everybody recognizes the brands. Regardless of whether you’re in the business-to-consumer or business-to-business space, a vendor’s brand flourishes when customers can trust the vendor to provide them with a special experience and constantly evolving great products. With that excellent foundation, judicious imaginative marketing can certainly fan the flames of exposure (think Toyota and Pixar, for example) , but on its own, marketing does not make a great profitable growing brand. (And think about the fact that there are many companies, like Google and retailer Zara and tube fitting manufacturer Swagelok, which build a healthy brand solely around their unique value proposition and do practically no conventional advertising). Tom Peters says that a brand “is a promise of the value you’ll receive.” In that spirit, I sometimes urge my clients to think about a new “P/E multiple”, one that supplements the traditional “price/earnings” metric. Think about a “Promise/Experience” metric. If, in effect, you can implicitly (not via sexy ads, but in the way you run your business) promise the marketplace that you will churn out a cool, special value in products and services-- and then actually deliver it in a way that generates a really desirable experience for the customer--the payoff in customer and investor loyalty is a genuine multiple. That’s what they do at Toyota, Pixar, Google, Zara and Swagelok, among many others. Put simply, the way to build a break-from-the-pack brand is not by public relations campaigns, ad rollouts, logos, color schemes, viral marketing, etc. etc. Those can definitely help if you’ve got the basics down. And what are the basics? The capacity to demonstrate to the marketplace that your organization will consistently, reliably, efficiently, authentically, and quickly deliver on great things that are implicitly promised in your business model. Retired Atlanticare CEO George Lynn used to tell me that from his perspective as a hospital CEO or an individual customer—the value of any organization he buys from must be “pervasive, relevant, and credible.” Once again, it all boils down to this: Can I count on this vendor to provide me with special value that truly matters to me? For me and my feet, it's Nike. What about you?