Your corporate and employer brands can be hugely helpful when recruiting. Why is it that some companies seem to attract people to a cause as opposed to simply a job? What can ‘normal’ companies do to emulate the success of Patagonia, Zappos and Apple?
I asked this and other strategic brand questions to Jeremy Waite, author of Survival to Significance and Head of Digital Strategy, EMEA at Salesforce Marketing Cloud. You can listen to the audio podcast on iTunes and Soundcloud (embed below) or keep reading for a summary of our conversation, a longer version is available at Link Humans. Questions by me, answers by Jeremy.
What are the 5 levels of brand leadership?
Essentially you have this level of survival where it’s called the location level. People follow you because they have to. They follow you because of where you are, it’s about place. A utility company, maybe a bank, maybe a mobile provider, maybe a broadband provider. You haven’t got a relationship with them. You might not necessarily like them but the customer service or because of the location of the store. Maybe a supermarket. That’s it. You follow them because you have to. So that’s in survival mode and typically the behaviour on that level is where everyone’s trying to compete against everyone else, it’s all market share, they’re just measuring likes. They’re just throwing everything out all over the place, measuring every single metric that they can. Push content all the time. Discounts, promotions, deals, you know what it’s like, right? We see that in social all the time.
But then something interesting happens, and they start to become successful and they say actually, you know what? Maybe we shouldn’t measure everything all the time. Maybe we should only measure customers, or our unique customers or unique conversations. Maybe we should start filtering out all of this noise and only measuring the important stuff and starting to have a conversation. So like Vaynerchuk, Solis and Sinek that are advocates for how to build customer companies, you know, Marc Benioff talks about that a lot. It starts to flip, so it’s not about the content anymore, it’s about the conversation. And that’s where I believe a brand starts to become successful. So that’s where you’ve kind of got this level of where people follow you because they like you, right? So there’s a certain position that comes with that.
And then really success, I break these down into three levels and say they follow you because they like you, then you go to a leadership level where people follow you because of what your brand has achieved and that might be measured by ROI because it’s commercial success. You’ve done amazing stuff, you’ve performed well, your marketing’s done well, you’re measuring the right stuff, you’re making money. People like that. Employees are inspired so they want to work with you. And that might be the commercial level of leadership but then there’s a level above that that I think’s the highest level of success which is where people love you. And this where you’ve got a genuine emotional connection with a brand. And you start to become loyal with them.
So this isn’t like where they follow you because they like you Facebook or they follow you on Twitter. They may be your favourite football team, it might be your favourite fashion brand, or your favourite actress or sports star. This is where there’s a genuine connection because you love them because of what they’ve done for you. And you can do all of that on your own. This is where you start to measure customer satisfaction, you’ve got people like KLM that just do an incredible customer service, great experiences, they’re measuring everything properly, NPS customer service resolutions. And that’s about as good as you can get on your own. Now what happens is there’s a level above that, but companies can’t get there on their own by putting in a good strategy or buying expensive technology. You can only get that by your customers putting you there. And I believe that’s a level of significance where you’ve got a cause or a belief.
And I’m trying to take this one stage further than Simon Sinek talked about years ago when he talked about what’s your purpose. Why’d you get out of bed? I’m like well, there’s a stand. Because it’s not enough to have a purpose, you’ve got to stand for something now. And what you stand for is more important than you what you sell. And whether it’s philanthropy, whether it’s giving back, whether it’s some kind of foundation model, whether it’s Mark Zuckerberg trying to create internet.org, or it’s Patagonia giving away all its profits, or Salesforce giving away all its time and product. That’s the level where people are genuinely inspired by that company. And regardless of what happens, they are incredibly loyal and they’re always going to love that company regardless of price. And they’re going to start causes, they’re going to start groups, they’re going to write books about them even if they don’t work there.
So the book, essentially, for me is what are those five levels? How’d you get from one level to the next? What’s the tactical things you can do to get there. And then the book ends with a handful of stories about companies that I believe are significant. And it’s a debate, right, because it’s my opinion. This is the fun bit and this is why this is a social thing. This is really where it gets down into the exciting stuff for me. Hopefully this opens up a conversation about I agree with that, don’t agree with that. Uber is not successful, Uber sucked because of the way that they’re doing… But that’s good because that’s the conversation at the moment, we’re not having enough of.
To recap, the location level is level one. The like level is level two. The leadership level is level three. You’ve got level four which is all about love. And the other level, level fifth is about loyalty and that’s where most of the case studies happen when we talk at conferences. We see the blog posts written about this is what Zappos did and this is what South Western did. And we’ve heard the same case studies a million times. That’s all a level of success. What a lot of people don’t talk about is the level above that where you genuinely got some kind of mission or cause.
What happens to a brand when it becomes significant?
So it’s a really good question. I’ve been asked this a bunch of times already, and there’s two ways to answer this. The first way is that the top level’s about loyalty. And from a marketer’s point of view, if we put our strategic hats on we could really talk about how it’s six times cheaper to keep a customer than to get a new one. And if you’ve got levels of loyalty, like Kevin Roberts and Saatchi talked about this back in 2005 in his book Lovemarks about loyalty beyond reason. People will buy from you regardless of what price you are, because they’re genuinely loyal. They will always buy Levi’s, they will never buy Wrangler’s. You go and speak to cowboys, there’ll always buy Wranglers, they’ll never buy Levi’s. There’s a level of loyalty there that’s very specific, it’s very tactical. But the other side, which is where it gets a little bit fuzzy is what you’re kind of saying is that if you do have a cause, and if you are trying to have some kind of philanthropic vision, you are trying to create these profits with a purpose. And the founder of Patagonia said exactly the same thing. We want to make a lot of money, but we want to make a lot of money so we can give a lot of it away. And the more we make, the more we can give away.
The challenge is whether it’s possible to measure the fact that if you have a cause, and you give more away, you’re going to make more. But Bill Gates famously said years ago, and it’s obviously easy for him to say that being one of the richest guys in the world, “That the more I give away, the more I seem to get.” Which is a nice kind of spiritual vision. I think if we kind of go too much down that fox hole, we’re kind of missing the point. So the loyalty side, I think, is very tactical. Love our customers, love our employees, measure employee satisfaction is customer satisfaction. But that kind of touches on the top level of success as well. What I want to do is say there’s a level up here where it’s not so much about measurement, and it’s not so much about all these tactical things that we’ve done in the past. It’s about legacy. It’s about what are people going to remember in 20 or 30 years time or when you’re gone? If people are going to sum your life in one sentence, what are they going to say? What’s the one liner they’re going to say about your brand?
And there’s not going to talk about, “Nike’s got amazing customer satisfaction. They’re MPS score is five times better than the industry average.” They’re not going to say that. Somebody might remember, “Oh, damn, did you see that Nike did that amazing initiative in Ethiopia where they’re trying to solve healthcare issues and spending a fortune to invest in adolescent teenage girls.” And there’s a whole story there that doesn’t get told. But yet we get consumed with maybe the darker stories of “No, let’s talk about Nike the bad brand, or let’s talk about sweat shops, or ethical trading.” I think there’s really positive stories that we don’t hear enough of.
What brands have got it wrong?
I can list a few. Yeah, and this was a really difficult one actually because it’s a very touchy subject as well. I work for an incredible brand myself and just the size of our company we deal with an awful lot of people, so we’re going cross paths a lot. So trying to be very sensitive, and it’s difficult as an author. How do you stay authentic and credible, and try and call people out, whilst at the same time not upsetting people? And I went back and I had a look.
I use an example of BlackBerry just because I worked with BlackBerry a few years ago and BlackBerry were incredibly successful, had a phenomenal market share, dropped through the floor. And they’ve now got a great CEO who’s trying to take them back up again.
Phones for You. I was the Head of social for Phones for You for a while. And they did some amazing stuff. And while I was there, we became the biggest telecom brand in the UK and we did all these wonderful things and put strategies in place, but where are they now? They’re gone. So I talk about them and I feel like I’ve got a view because I can talk about them, I’ve been there and also, they’re not around any more, so they obviously did a lot of things wrong. So the future hasn’t played out as we thought. But Phones for You were interesting because they had a very, very transactional view of customers. And it was very much kind of click to buy. It was all money spent on search and display. It was very much how do we create an action to get someone to upgrade their phone, or buy more data, or to change their plan, or can we find a way of upgrading them before their plans and stuff? And obviously, it’s an incredibly competitive landscape in telecom. And Phones for You was doing some really good figures for a while.
But I think it goes to show that transactional relationships just don’t play out. Whereas loyalty does. Loyalty you’re in it for the long term. Transactional is very, very short term. ROI driven, let’s make some more cash tomorrow view. And essentially, that was the downfall of Phones for You. They didn’t invest in customer service. They didn’t invest in loyalty. They didn’t provide the best customer experiences. It was a very transactional experience to go in one of their stores and to try and buy one of their phones. Even though you may have gotten a phone cheaper in their shop than anywhere else. You may have gone in wanting to get a cheaper Samsung, and you end up walking out with an iPhone. I think that’s typical of a brand in survival mode, fighting for market share, trying to buy attention and eyeballs, cheaper deals, discounts and promotions. And exactly, you know, where are they now? They fell over.
Is there a recipe for becoming a brand that puts purpose before profits?
So I don’t think it’s a step by step guide because once you talk about profits with a purpose, that is something that has to be embedded within the culture of the company. You can’t just say, and a great example might be a brand that says, “Right, we’re going to attach ourselves to this charity and we’re going to have this initiative, that we’re going to go out and support schools.” And it’s almost a very transactional view. Let’s attach ourselves to a cause because it looks like the right thing to do. And that’s CSR. A lot of CSR policies are like that. What I’m trying to talk about is there has to be a giving mentality that’s completely different. So it’s not so much that you’ve got a step by step guide because really, that’s what CSR policy is. It’s how do we figure out what it is that we’re doing to make the world a better place, and be responsible and all that sort of stuff? And it’s interesting stuff and we should all do it. But I think there’s a level above that that has to come from the founder.
So whether or not, you know even from Patagonia and you’re talking about let’s give 10% of revenue, or 1% of profits, whichever is greater and we’re going to donate all of that to outdoor charities that we believe in. Whoever he’s investing in, usually some kind of local charity around the mountains and stuff, the outdoor brands that he works with. Marc Benioff, you know, the 1-1-1 model, you give away 1% of product, time and equity. And that came right from day one when the company was set up. That wasn’t an initiative that we thought, well, we’ll do that because it’s cool and we’ve got a whole bunch of money. It was if we’re going to make a lot of money, we need to make sure that as we scale, our giving can scale as well. And the reason I ended up write the book when I was looking into it. And I’m not, you know, Charles Best from Donors Choose says, “If you give away one dollar, you’re a philanthropist.” And I think there’s this misconception that philanthropists have to be like Warren Buffet or George Soros and have billions of pounds before you’re a philanthropist. You give away one dollar to the guy on the street, you know, and you’re a philanthropist.
The issue with businesses, and you can look at philanthropy.org and there’s a whole load of sites that you can go find out these stats, but of all the money that’s given in the world to do good stuff, only 5% of it is given by companies. And of the 5% that’s given by companies, 80% of that is given away for tax reasons because it makes sense to do that, because you can offset your tax against corporate giving and stuff. But that leaves a very, very, very small percentage of brands that are saying we want our profits to have a purpose.
What brands are significant and doing it right?
I used the, it’s kind of a really cheeky idea of an example, Levi Strauss, one of the biggest jeans brand in the world, one of the best socially connected brands, huge company, done incredible stuff, patented the denim and riveted the jeans together. He didn’t want to do that in the beginning. He didn’t want a make a ton of money, even though he left his family and he moved over to San Francisco in the middle of the gold rush in the early 1900s. He wanted to invest in universities, in scholarships, and orphanages. And he was like, “How can I do that? Well, how about if I set up a business?”
Then he saw people’s pants were ripping when they put their axes and stuff in it. So he buys this new tent material, he makes this thing that ends up being denim and then they figure out that they can rivet them together because they start to become torn. And his friend comes over and says, “We can patent this, but I’ve got no money.” And he says to Levi, “You’ve got a bit of money because you’ve got a camping shop even though you’re not selling that much stuff. Do you want to pay for the patent? We’ll split it 50/50.” Levi’s Jeans are born. Now Levi starts to give away a ton of money and they’re doing amazing things. And it came from he wanted to make profits with a purpose, but his purpose came first.
So now my challenge is, if you’re making a ton of money, fantastic. You need to put those principles in place. But you’ve got to make sure it’s authentic and your intent is correct. But the brands that are doing the best stuff like Toms, like Patagonia, like Levi’s and Salesforce, even Nike when you look at their foundation stuff, it happened on day one because their company was built on a purpose and they knew what they stood for. And everything was like secondary. I actually believe, provocatively, a lot of people don’t agree with me on this, I believe Facebook’s exactly the same. There’s a reason why Zuckerberg’s investing so much money into internet.org. It makes no commercial sense whatsoever for Facebook to do that at the moment. Transactional brand, short term money, keeps stakeholders happy. The two-thirds of the world, that internet.org is trying to connect, are not going to spend any money on advertising, they’ve got no data plans. He’s trying to make people access Wikipedia by floating drones and giving Wi-Fi to everyone, or seeing a farmer that you can check your stock price and make more money to support his community. And that isn’t a financially driven incentive, that’s just we want to connect the world to make it a better place. And we can be really cynical, as we should be, because it’s Facebook, but again stories like that don’t get told often enough, I don’t think. And I don’t think people like Zuckerberg, and internet.org get enough credit for that sort of stuff.