It’s hard
to overestimate the impact that Wally Olins CBE, who died recently, has had on the
marketing landscape, almost single-handedly inventing the concept of brand
management and embedding the idea of brand equity into the minds of marketers
and business leaders.
His belief
in the importance of corporate brand for companies, charities, NGOs – and from
countries to individuals - was pioneering, back in an age when advertising was
all about product marketing. Olins, who
co-founded the international agency Wolff Olins, wasn’t interested in what went
into a packet or tin; he was interested in the company behind it.
The
Financial Times has described him as “the world’s leading practitioner of
branding and identity,” creating a new discipline separate from other facets of
marketing communications, such as PR and advertising. He believed that, while companies created
brands, the consumer had ultimate power – not only looking for utility in what
they bought, but a connective meaning with the brand.
Back in the
1960s, many of his ideas were seen as wacky.
Now, the consultancy firm Millward Brown estimates that the top 100 brands
worldwide were worth $2.6 trillion in 2013, up 7% on the year before. Some of those brands, such as Google and
Microsoft, haven’t been around for very long.
Others, such as Coca-Cola, have been with us for over a century.
Olins
recognised that good branding needed to precede marketing. To him, branding was more than a fancy logo,
website or snappy slogan; effective branding should capture the essence and
values of a company – a “pull” strategy that consumers could relate to. Tactical marketing generates sales; strategic
branding generates loyalty.
Over the
years Olins advised not only companies but countries. Perhaps most memorably, he advised British
Telecom to change to BT, and encapsulated the brand of a new mobile phone start
up in a colour – Orange.
There are various inexact methodologies for
measuring brand value – looking at a brand’s market share and how it is
perceived (or “mind share”). Using that
yardstick, it’s possible that a brand might have a higher mind share than
market share – perhaps because consumers, while liking the product, can’t
afford it.
In other
words, brand value (or brand equity) can’t be easily measured. Simplistically, Heinz charges more for its
baked beans than a supermarket’s own brand.
But, leaving aside any differences in product, many consumers vote with
their wallets and buy Heinz – branding has made the company synonymous with the
product.
This in
turn raises interesting questions on the value of intangibles: between a
company’s book valuation and the longer-term intangible value of its
brands. For many companies today,
greater corporate value resides in its brands than its balance sheet and bricks
and mortar.
As
consumers, we now have multiple choices – from competing companies selling the
same kind of product, to buying them online or in an old-fashioned shop. Our purchasing decisions are, of course,
influenced by a number of factors, not least price – but so too by our
perceptual view of the company selling that product to us.
No wonder
then that successful marketers and business leaders now pay close attention to
brand and reputation management, recognising that corporate value is as much to
do with positive consumer perceptions as it is about profit margins and market
share.
The
branding landscape is constantly changing, complicated also by evolving trends
and, not least by how we manage our purchasing habits between needs and wants –
between those things essential to us and those things that we’d like to have,
but don’t need.
In a retail
context, the best examples are low-cost entrants such as Aldi, Lidl or
Poundland. They have built brand value
on the simple fact that we’ll pay more for things that we want, but insist on
low prices for the things we need. On
the back of that simple psychology, they are building strong and valuable
brands – while others, such as Woolworth’s, saw their brand equity fade to
nothing.
The term
“brand” comes from the Old Norse “brandr” meaning to burn – used, among other
things, as a way of identifying cattle.
The oldest brand is reputed to be an Indian herbal paste, Chyawanprash, in continuous use since about 1000 BC.
So, in
appreciating the intellectual rigour of Wally Olins, it’s nice to know that he
was only rediscovering best business practice from long ago.
You can contact us at +44 (0) 1620 844736 or Charlie@davidgraypr.com or connect with us on LinkedIn or
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