[Podcast] How Brands Grow with Professor Byron Sharp

In this thought-provoking episode of JUST Branding, we’re thrilled to host Professor Byron Sharp, a leading figure in marketing science and the Director of the Ehrenberg-Bass Institute, the world’s premier center for marketing research.

Byron, renowned for his groundbreaking book “How Brands Grow,” which has significantly influenced the marketing sphere over the last decade, joins us to unravel the scientific principles behind brand growth.

Our conversation kicks off with Byron’s inspiration for exploring consumer buying behavior and brand expansion, setting the stage for an enlightening discussion on the essence of his work.

Delving into “How Brands Grow,” Byron sheds light on the book’s key insights, including the pivotal concepts of Mental & Physical availability, the synergy between Distinctiveness and Differentiation, and the power of distinctive brand assets in forging lasting brand memories.

Tackling prevalent myths in brand growth, such as the overemphasis on brand loyalty and the crucial need for broad market reach, Byron emphasizes the role of continuous brand exposure in shaping consumer preferences.

He offers practical advice on how listeners can apply these insights, highlighting the balance between innovation and consistency in brand strategy.

For designers, Byron discusses the creation and rapid adoption of distinctive brand assets, providing a blueprint for branding success.

Tune in for an episode packed with invaluable insights for growing better, more recognizable brands, based on rigorous scientific research.

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Show Notes

• How Brands Grow Book

 

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Transcript (Auto Generated)

Hello, and welcome to JUST Branding. The only podcast dedicated to helping designers and entrepreneurs grow brands. Here are your hosts, Jacob Cass and Matt Davies.

Hello, and welcome to JUST Branding. Today, we have the esteemed Professor Byron Sharp with us. Byron is a Professor of Marketing Science and is the Director of the Ehrenberg-Bass Institute, which is the world’s largest center for research into marketing.

His book, How Brands Grow, What Marketers Don’t Know, has been called one of the most influential marketing books of the past decade. It’s helped uncover scientific laws about buying and brand performance. In other words, this is how to grow brands based on science.

Today, we’re going to delve into these strategies with Byron and ultimately help you grow better brands faster. Welcome to the show, Byron.

Thank you. Good morning.

Pleasure to have you.

Morning here in Ebelhead.

Yes, it’s morning here also.

Evening over here in the UK, but it’s fine. It’s morning where you are, so we’ll go with that. Good morning, everyone.

Cool. We’re going to jump straight into this. We’ve got so much to cover, but I first want to know, how did this come about?

How did you come to write a book about buying behavior and growing brands?

Well, I’m the director of the Ehrenberg-Bass Institute, which is a large university-based research institute. And we’re completely sponsored, completely funded by real world companies. And we have advisory boards in Europe, in the US and in Australasia.

And I can’t remember which board it was, possibly the European one. First suggested that they needed a book. They needed a book, you know, so they could give to the CFO and CEO and say they were making changes in marketing.

But at this time, there was some serious evidence behind them. So they asked us to write a book on our sort of older fundamental findings, you know, put them all together in a package, which, yeah, sounded a bit daunting, first of all, but it did occur to me, I did have presentations that I’d been doing with executives and I could, you know, I could use those. They formed the structure for the chapters and yeah, away you go.

So I always joke it needed to be a, you know, the brief was, it has to look professional, you know, it has to have a prestigious publisher. We got Oxford University Press, you know, aren’t too shabby on the prestige front. It has to be hard back, you know, because this is all to impress the CFO or the CEO.

Yeah, but that’s the last thing you do if you wanted to write a book that sold a lot.

Yeah, but it kind of sounds like it was the golden ticket for execs to like hand over to their CFO. It’s like, look at this, now give me money.

Yeah, well, quite that blatant. But at least I think it has ushered in a lot more credibility for the marketing company and understanding more. Finance people love it, you know, it gives understanding of what marketing people are doing and also how they should be judged.

Well, let’s dive into it just so people are aware of the book. There’s two of them actually, part one and part two. Can you share what the book’s about and some of the core principles in the book?

I know there’s a lot to unpack there, but just like a high level overview.

That’s like the overarching. I think why it got so much attention and indeed today is still selling well is because it’s the only book that was the first book that really introduced scientific laws and it’s a rather radical idea that there could be laws in marketing, which not thou shalt laws like you must do this, but reoccurring patterns in the real world in the same way that we see them for chemistry and physics and biology and all sorts of other things. So in that way, it’s not radical, right?

I mean, why shouldn’t there be marketing in the real world? Why shouldn’t there be reoccurring patterns that allow us to predict and then explain? So, but it was a bit of a, you know, marketing was a real anything goes discipline, you know?

And the idea was, well, two ideas. One is that we were a creative discipline. So, you know, hey, don’t question me, it’s creative, which is valid, I think, for us.

So for the creative part is totally valid. But the analogy I use in the book is architects work in that world too, right? They’re pretty creative, I would hope.

Sometimes not, but anyway. But at the peak, they produce beautiful buildings like the Sydney Opera House, right? Radical and they’re creative.

It’s terribly interesting. But they have to hand over plans to builders that do conform with the laws of physics. You know, because they are dealing with the building will be in the real world.

It won’t just be on your computer. It will be in the real world. And so therefore, it has to conform to real world laws.

Otherwise, it’s going to fall down. And, you know, I use that analogy for marketing. The same thing.

Fine, you can be creative. That’s fine. But you do need to understand how the real world works.

And otherwise, you will start doing. We have hundreds, hundreds, if not thousands of years of evidence of people doing really crazy things. And in the book there, I use the example of doctors bleeding people, which we now look at as really crazy.

Well, dangerous, you know, they killed so many people. So you do have to understand the real world. And, you know, there was nothing like this.

I mean, when I went through university, we had the big thick textbooks from, you know, Philip Kotler and Garthian Perot and others. And there’s no, there’s nothing in there about predictable patterns. I’ll give you an example.

Some textbooks mentioned the 80-20 law, rule, and that sounds like a scientific law. That sounds like that, but they never present any data or evidence. And it turns out that actually it’s wrong.

There is an 80-20, well, the remarkable thing is there is a predictable pattern, but it’s much closer to that your top 20% of your customers give you about half your sales, not 80. It’s not that extreme. And the bottom 80% of your customers, they give you your other half.

So they’re quite important, you know. So understanding the real world really changes marketing strategy, and it gives you understanding, allows you to make predictions, allows you to realize that some things just, no matter how well you’ve executed, some things aren’t going to work.

Yeah, I love that. I love how the book starts, like, literally before you even read anything, it’s like list of laws. That’s literally what you’re first presented with pretty much as you open it, list of laws, which is a sort of an annex, do you call it that?

An annex, like a pretext, I don’t know, before the actual book. And then just so listeners get an idea, I’m not going to go through the explanation of them, but like you’ve got the double jeopardy law, the retention double jeopardy, the Pareto law, which is what you were referring to there of 60-20, the law of buyer moderation, national monopoly law, user bases seldom vary. The next one is attitudes and brand beliefs reflect behavioral loyalty.

Usage drives attitude or this is my favorite bit, I love my mum and you love yours. Law of prototypicality, duplication of purchase law and one I can’t hardly pronounce, the NBD-Dricklett law. So there’s quite a lot there, quite a lot of laws as you start the book.

It sounds really geeky.

Well, we are all a bit geeky, are we? Let’s be honest. And I guess the thing though is as practitioners in this space, what I think I particularly like about it, and I know you probably do as well Jacob, is we need laws to govern us and to guide us and to structure our thinking.

And, you know, often I’m asked, and I’d love to hear your thoughts on this, I’m asked by leaders and stuff to help them step into the unknown, where there is no data. Sometimes we have to go with a belief system. We have to deal with the culture of a company as it is, the merger and acquisitions that it’s handled up to that point.

And then we see high growth in the market and we’re going to launch ourselves forward and put ourselves forward. And these are scary times. There’s not, you know, often, sometimes I believe in the strategic world, you have to step into the unknown.

So having some stuff, some laws, some stuff in the rearview mirror, we can say, do you know, we tried this before and it miserably failed. Like, it’s probably not the best idea to do it again. It’s helpful.

Is that how you find, you know, the book is used or do you find it’s literally people do deploy the laws and ask you to kind of track them as it goes through? How are you finding it’s being used? I guess is my question.

No, I think the thing really is that they start to give you a deeper understanding of the way the world works. And the world is a pretty weird place. I mean, every, here’s the weird, you know, our intuition is rubbish.

I mean, really, we are hopeless. And all the research on people making predictions shows how miserable they are, even though they’re experts, experts aren’t any better. You know, it is, yes, it’s a very difficult place.

So you need some sort of guidance. So, yeah, a doctor in a, I don’t know, in a war zone, patient comes in, there’s no data on them. They don’t have any of the past history.

They’ve done those scans or something. And, you know, it’s a bit like a strategy entering the unknown, but they have to do something. And so you need a certain understanding, like that bleeding is bad, or how much knowledge of how much blood there is in the human body.

So you know, if you know vaguely how much they’ve lost, how dangerous this is and things, you need some guiding principles. And that’s really, I mean, it’s the big theory that the book puts forward is a, I think quite a, we’ve just written a journal article saying, you know, pointing out the academics, what a big change in thinking this was from a four P’s do stuff, and then things happen immediately in the marketplace to, well, no, actually, what you’re really doing is building two market based assets, just mental availability and physical availability. And everything you do today is moderated by those assets, which are usually built by your predecessors and people before them and the people before them.

It takes time, right? Yeah, it takes time.

And so that changes your view of marketing and how you would measure it to the things you’re doing today.

Can we just tuck into those two aspects? Physical availability and mental availability, because I think they are core principles, as you say, of the book. The physical availability, as I understand it, is access to buy.

But you know, please clarify me if I’ve got that wrong.

Yeah, yeah. So some people get some people get rather authentic, you know, but I can buy on my phone now. It’s like, well, yeah, I don’t think that, yeah, okay.

That’s physical availability still, right?

That’s still, yeah, one place you could buy.

So yeah, it’s access, how easy. And so being easy to buy is really, really, really important. And I think a lot of marketers just, you know, don’t, they lose sight of that and, you know, don’t audit themselves and things like, you know.

So do you take PayPal? Oh, no, we don’t take PayPal. Right.

So you’ve just made yourself harder to buy for lots of people. Lots of people use PayPal. They’d like your newspaper.

Why? Why are you sticking a barrier? You know, like, it’s so bizarre that marketers actually have lots of barriers, making it a little bit hard for people to buy.

Why?

I’ll tell you why, though, because often those disciplines, like, for example, PayPal, the marketeers don’t often see themselves like, is that my responsibility to get PayPal established in the business? Or, you know, as a simple example, that’s finance’s decision. And I think what happens is you get, you know, you get this siloed behavior that puts up those barriers, like you were saying, like, but, you know, we all think about it.

I mean, we hate it in marketing, right, when we get called the coloring in department.

Yeah. Yeah.

And then we’ll say, oh, you know, things like how people pay, oh, that’s not my responsibility. You are the coloring in department. Is that what you’re saying?

Precisely. So availability to buy or, you know, physical availability. And then the other category of importance that you were talking about was mental availability.

Is that, you know, as I understand it, that’s kind of my meaning. I attach that brand and the stories and all of the thinking and the practical usage of it and all of that side of things, you know, what I think about that brand. Is that right or have I got that wrong?

You got that wrong a bit.

What you’re doing is saying, like, you know, when I think of the brand, what do I think of? Like, do I think they’re nice people or, you know, deliver quickly or destroy the planet or whatever? But no, no.

Mental availability is the other way. It’s what makes you think of the brand. What are the things that bring the brand mind as a potential to solve?

Because you’re trying to solve something usually. You know, you’re like, I’m a bit hungry or I’m a bit bored or, you know, or I have to go to the other side of town or, yeah.

There’s some examples of this is like, let’s say you go to the beach and you think of Corona if you want a beer or, you know, you’re taking a break, you think of a Kit Kat or something like that. You’re tying an event or a time period to that product.

Yeah. Well, it can be all sorts of other things, all sorts of what we call category entry points, things that trigger, but that’s mental availability. And it very much is, so the really surprising finding is that’s branding, right?

That is 99% of branding is making a brand look like you, right? And trigger to buying things. Whereas previously branding was always portrayed as a sort of rather mysterious thing.

We’ll imbue the brand with all these special values and it’ll make people just, it’ll lure them in and they will buy it because it’s magic. They just love it and they don’t even know why they want to pay that huge price premium. This is what was sort of pitched to the CEOs and things.

And actually a lot of them believed it, but they didn’t like it because it’s very, it is a bit mystical and things. But it turns out, no, the world’s actually a lot more sort of down to earth prosaic thing. You buy the brands that you think of more often than the brands that you don’t.

And so for that, branding becomes horrendously important, but not for the sort of mystical things. Branding becomes so important because people look at a crowded screen or store or something or street, and they need to see you.

Yeah, they need to see you for those two reasons. As you say, mental triggering and also it has to be easy to buy for the physical availability. So, yeah, that’s…

I use Subway as the, I think, example in How Brands Grow because Subway is one of those things where if you look back at it, you’re like, oh, damn, when did I think of that idea? It’s like sandwiches, right? You know, in the whole fast food category, which is a big growing fast food, convenience, snacking, it just keeps growing, growing, growing.

And it’s for a hundred years. And your sandwiches, they’re really popular. Geez, aren’t they?

But they’re all sold by all these fairly unbranded little convenience stores. There’s no brand of sandwiches. And so they branded a sandwich shop.

And it’s your personal view whether you think somebody are really good at making sandwiches. But in fact, it is still a fantastic brand, right?

Yeah, I had a story about that. I don’t know if I read it somewhere, but the guy that did it, and I don’t know his name, so apologies if he’s listening in. I’m sure he’s got better things to do than listen to our podcast.

But if he was listening to apologies in advance, message us. But the thing I was going to say was apparently he had one of those classic sandwich shops that you’re talking about that just made loads of sandwiches. And then he just kept adding new, you know, the shop down the road would have now some special chorizo or something, and then everyone go crazy on chorizo.

And he kept adding to the stock, and it was becoming a nightmare to manage all those different things, different types of bread, different sauces, everything became, you know, and he was thinking about it, and he was becoming less and less profitable. And he thought, do you know, like, what if I just took my most popular sandwich that I make, and that’s the most popular one, and I just literally narrow in on that one? And that’s what he did.

And it was the submarine, you know, rubble. And so, yeah, there were a few variations, but ultimately it was the sub. And that’s where, that’s the rumor anyway, that’s the urban myth where Subway came from.

And so that’s why it became so popular.

But the key thing was the branding. And that you opened a second door and a third and a fourth and a fifth and a sixth. And they all looked exactly the same.

Yes. And therefore owned the mental availability and then made it more accessible as it spread throughout the universe. So, yeah.

For most of us on the planet, we had no idea what a Subway, what does that even mean?

Submarine.

Yeah, no one knew.

I still don’t know. That’s completely weird, right? But we know, you see the thing, you know, in Starbucks, you know exactly what it is.

You know what you’re going to be able to buy. You know, it’s fantastic mental availability. And if anyone ever asks you, like, why are they called Starbucks?

Because they want to make a lot of bucks out of us.

Maybe. But, you know, it doesn’t matter. It’s a brand, you know, and that’s how brands work.

And they’re distinctive, right? Subway stands out because they’re so different from all other sandwich shops out there. And I know this is a bit…

Yeah, but it’s not that they stand out for being any way particularly wacky or anything. It’s they stand out because they look like them, not someone else. You know, you look at a KFC, you look at McDonald’s, you look at Subway, and you know instantly what they are and what they aren’t.

You never get those confused. And that’s branding.

And you talk about this a lot with distinctiveness, right? And we had Jenny on the show in a previous episode where we went into more detail about this. Yeah.

But did you want to share briefly the differences between distinctiveness and differentiation for our listeners and your view?

Yeah, it’s quite simple, although some people seem to manage to make it more complicated.

Well, you’re here now, so let’s hear it from you.

It’s branding. It’s just looking like you. And you know, whatever way that is.

So, okay, you’ve chosen the name Starbucks. All right. Imagine if you’re the agency and you get in.

So, you know, we’re opening more and more coffee shops. We want some advertising or something. Our name is Starbucks.

You’d be, Oh, okay. That’s weird, but whatever. Yeah, we just go with that.

And that means you are you. Starbucks is not Dunkin Donuts. So it’s just absolutely pure branding.

And private labels and all some things try to steal it because they realize that, you know, that really works, right? If someone’s built that mental availability for that distinctive brand, that works. And even bland brands can still be distinctive if they’ve got themselves into people’s heads, although probably it’s better not to be bland.

But there are plenty of bland brands in the world, you know, IBM, Microsoft.

So distinctiveness is about being you and showing up as yourself, not just for standing out, but being you. That’s what branding is.

Yeah, yeah. So if you’ve got into people’s brains, you will stand out, right? Because it’s like they can read you.

It’s the same. It’s quite weird to think, isn’t it? If you put up some words like the JUST Branding Podcast, right?

So we read those in a microsecond. We just cannot stop ourselves. Whereas when we were like three years old or something, they were just shapes.

So they got built into our brain. We’ve got shapes too here.

Matt’s the square, if you haven’t guessed.

Yeah, why am I the square? If you call someone a square, that’s usually like an insult, but I get the square.

Just a pure coincidence, Matt.

The key thing with branding is it’s not about meaning. We don’t think about this stuff. As I always point out, no one ever.

The world’s big place is probably some weirdo who went, why does McDonald’s have a Scottish name? But most of us didn’t because we don’t think of that. We think of them like letters in the alphabet.

They just work fast for our brain. That is the amazing thing of distinctiveness, which I think is quite amazing, isn’t it? All of branding, it’s probably the least controversial thing that Ehrenberg-Bass has ever released to the world.

And everyone went, oh yeah, that’s important. Distinctiveness, yes, absolutely. Distinctive brand assets, characters, logos, yep, absolutely.

And then you’re like, well, how come this was not in branding textbooks and marketing textbooks before? I love it. You get some people go, oh, I’ve talked about that for years.

Really, have you? I’d love to give you credit for it. So where did you write about that?

I got a research assistant go back through business magazines and things going back. It’s just amazing. It’s virtually nothing.

The best you get in textbooks is a mention of distinctive brand assets, of colors and logos are very important.

There was always been part of building a brand, but never really studied in terms of how they work and how they make.

Yeah, it was never formalized. A brand manager was never told, if you’re a brand manager, you must measure your distinctive assets. You must make choices about which ones you’re going to invest in.

You must do this. Otherwise, you’re just sort of flying blind.

Before we get into distinctive brand assets, I just wanted to shine a light on differentiation, because I know there’s a debate around that. We’ve talked about distinctiveness, showing up as yourself and being you, but how valuable do you see differentiation and how does that mix with distinctiveness?

Differentiation is, well, it depends. Differentiation is good differentiation, bad differentiation. Some brands are differentiated by the fact that they’re too expensive or too slow, or don’t taste as good as the others.

We can be differentiated in good ways and bad ways. Thanks to competition in the main brands, catch up and stay pretty on par with each other. That is the really surprising finding that brands don’t really compete as terribly differentiated things, even though they are.

Apple Macintosh runs a different operating system than a Dell computer. It is quite functionally different, but they still compete largely as brands. And for an awful lot of consumers, they use either and have swapped between them.

Indeed, Apple almost broke at one point, losing so much share to Dell. And then nowadays it’s sort of around the other way. It’s obviously not the differentiation story.

That’s a really surprising finding that most of the successful brands of the world, multi-billion dollar brands, are not terribly differentiated. Their buyers, most of their buyers, mostly regular buyers, don’t actually see them as really any different. They could buy another one, wouldn’t be that radically different.

And yet, that doesn’t seem to hurt them. That is the norm. So that is a really surprising, it doesn’t say the world is a weird place.

And so that at least means as a marketer, you don’t have to go, oh no, it’s terrible. I’m working for this bank and, god, we’re basically a good bank, but we’re pretty much the same as the other banks. We have all the same products.

And it’s like, oh, what do I do to differentiate myself? And the answer is, well, you don’t have to worry about that that much. It’s not as big a thing in marketing as we used to think it was everything almost.

So much emphasis is put on innovation, but innovation is fleeting up until a point. So I’m curious if differentiation isn’t that important. I don’t mean it that badly, but how important is innovation when it comes to building a brand?

Well, again, it’s the thing of some innovation is important. Because sometimes you have a radical breakthrough and it really gives a huge benefit to the world and you’re highly differentiated in a very good way. And that’s fantastic.

Most innovation is not that, unfortunately. Most of it is just little things that are trying to tweak and to keep us undifferentiated. Like the way that Subway will do chicken sandwiches and KFC will do chicken burgers and McDonald’s will do chicken burgers.

These might seem as innovations for them at the time, but they’re largely just about sort of catching up. So, look, hey, we’d all like to invent the iPhone, but let’s be honest, even for an amazing company like Apple that does it, which is a serious R&D company, that’s been billions of dollars on R&D, they don’t come up with those things very often.

No. So just to be clear here, and forgive me if I’m going to make another blunder, but I’m going to blunder my way through.

It’s useful, isn’t it?

So let’s say you’ve got a business, they’ve got an innovation that’s really unusual, and it creates its own magnetic pull, its own marketplace, almost its own category. That, as you hinted at, does seem to be kind of a holy grail. If you’ve got that innovation, good for you.

But for the rest of us, where we’re in existing marketplaces with existing norms, the aim of the game there, from what I think you’ve been saying, is don’t try and completely rip it all up and start again. Just do what you’re doing, but just do it in a distinctive way so that you’re recognisable, so that people can buy from you easily, so that you can create a mental availability in their minds. Is that the thing that we’re driving at here?

Yeah. It’s a bit like the old allegro, 99% of success is just showing up or even creativity or in science, it’s mostly 99% perspiration, not inspiration. What’s the same?

99% of real world marketing is about building mental and physical availability and treasuring those assets and making sure they don’t erode when you’ve got hundreds of competitors who are trying to do that to you. So when Apple made the first iPhone, yes, what they should have done is roll out mental and physical availability as fast as possible because eventually some other people will come along and build an operating system called Android and they will make phones too, you know.

Do you think this is sort of part of like the business, I don’t know what the correct term would be, but like the life cycle of a business or a category of businesses within a category. So in other words, if you’re first to market with something unusual or very early to market with something unusual, then play the game of differentiation. If you’ve genuinely got something unusual, go for it and really emphasize that.

But if you haven’t, own up to that fact, be okay with the fact that it’s familiar and similar to other people, and then play, you know, and then don’t emphasize that. Because as a business sort of enters the market, grows, and then eventually dies at the end, hopefully, you know, it’s going to keep innovating. But rarely do those innovations kind of kicks go to the point where they first started.

So if I take Coca-Cola, for example, whoever came up with Coca-Cola, first of all, it tasted great. It was the, you know, they made it available. Mental availability followed.

It was, you know, one of the earliest to market, one of the earliest to go global and so on. Great. In effect, slightly, you know, different in the marketplace.

But now it’s out there. Now its job is not to be different anymore. It’s not different.

We’ve got loads of competitors coming up behind it.

Now it’s job is probably wasn’t different for most for a while. So you look at that and then go, yes, there really is a lot of serendipity and there’s a lot of other things. And so this is the rewriting of the textbooks because the textbooks, thou shalt differentiate.

You as a manager should be spending 90 percent of your time thinking about this and measuring your differentiating. This is no, there’s a lot of other much more important things.

Maybe that was a bad example, but yeah, OK.

And always some people say, you know, how would you like if you had differentiated, you’ll know just to ask an eight year old kid, right? If you have to commission some fancy market research to measure it, then you probably haven’t got me.

You’ll know it.

My three year old sees the McDonald’s M on the highway and knows straight away what it is and wants to go there, playground, food, all that. So it’s already in their brain from that young of an age.

Oh, well, that’s the distinctiveness. Yes, yes, yes. That’s amazing.

Yes. But, you know, likewise, he probably likes some other places too. And if you offer those to them, he likes those too and indeed does buy other places.

Probably doesn’t turn down KFC or Pizza Hut or whatever. So, you know, it just reorders our thinking and makes us, it’s interesting from, you know, from the design perspective, it makes us realize that, wow, okay, so distinctiveness, those colors, logos, fonts, and how we’re disciplined in using those in the world and also creative. They get a lot more important, right?

This idea that, oh, no, that’s just the coloring in stuff and, you know, this product will sell. I mean, you do, you have colors, old textbooks, we talk about, you know, we’re almost anti-marketing, you know, I wish we would just make vastly superior products and vastly superior service, and then they wouldn’t have to do any advertising and worrying about that and stuff. All around the world, this year, there will be people leaving, you know, universities with architectural degrees or accounting degrees or something, and off to create their own little company.

And you’d go, right now, remember, you’ve got to be terribly differentiated. How? I want to provide good accounting services.

I want to be a good architect, but I’m essentially going to do the same as all my classmates. And that’s okay.

So what about some other angles of differentiation? So as designers, you’d look at competitors and they all have a certain style about them. There must be some value to differentiating from the marketplace and having a unique look and feel.

This is about distinctiveness. Sorry, I should have said the definition of differentiation is not about, it’s about giving something that’s valued by the buyer as some sort of benefit. The fact that Coca-Cola comes in a red can doesn’t give you any benefit over a blue can.

It doesn’t really matter to people, but it matters a lot. It’s branding. Yes, that matters a lot.

So if you’re asking, and this is distinctive asset management, should we be like, okay, all the other chocolate bars are in red and black and brown, should we do something different and our chocolate bar would be green or white? You have to research that. Because while that sounds good, because it’s going to be much easier to be distinctive, where the green chocolate bar, it can also really backfire and the people just don’t see you as a chocolate bar.

And that, of course, would be death.

Yeah, there’s a lot of variables to consider. The context matters.

Yeah, context matters. And some things you cannot decide by yourself. You have to get out into the real world and do some experiments and interview consumers.

Because we might have loved the green wrapping, but they all thought it was not a chocolate bar.

But sometimes those things happen, don’t they? Because if you think of Method, I don’t know if you’re familiar with that brand, they make beautiful cleaning products. They package them in a really beautiful way.

Prior to Method coming along and doing that…

Aesop would be a fantastic example of that.

Great. Yeah, I mean, prior to that, everyone was bottling stuff in whatever they could get their hands on in a very robust, ugly kind of way. And Method took a classic, typical way of doing things and differentiated, can we say that with it, in that market by doing it slightly different.

Or maybe we would you call that distinctiveness? I’m getting confused.

Yes, there was distinctiveness about their brand. But I also believe Method was one of the new wave of green…

Yeah, there was that as well.

But that differentiation sort of disappeared, hasn’t it?

Yeah, they were more distinctive. So that’s an example of distinctiveness, folks. Don’t get confused like me in my old age.

And it is, to be fair.

The simple way to think of it, because the legal courts make a very clear distinction on this. If you’re better, I suppose all worse, but if you’re better, if you give something to consumers from a different situation, our interest rates lower, our microphone is more sensitive, our TV is brighter, whatever like that. If someone copies you and you take them to court, the court will look at, well, do you have patent protection from that technology or that process or something?

And if you’ve got that, you’re allowed to stop them, but only for a while and then it lapses. But in the main, if you don’t have that, the courts go, well, I’m sorry, that’s competition. It’s like, yeah, you made something a bit better and everyone went, yeah, that’s a really good idea and they’re allowed to copy it.

That’s called competition. That’s fine. But if it doesn’t give benefit to the consumer, it just does branding, it just makes you look like you and someone copies that, yes, you can take them to court.

And if you can convince the judge that that’s our distinctive asset, that gives us mental availability and they’re trying to look like us, you can enforce that. You can enforce that for hundreds and hundreds and thousands of years, right? Because the courts make a very clear distinction between differentiation and distinctiveness.

Distinctiveness is branding and that you’re not allowed to do. You’re not allowed to steal someone else’s stuff on that. I use the example often of someone must have made the first remote control on TV and consumers went, oh, this is awesome, right?

Particularly men, you know, I don’t have to get off the couch. Wow, this is fantastic, right? So it would have given them a fantastic sales advantage, right?

And so every other, it’s not possible today to buy a TV set that doesn’t have remote control, is it? They all copied. And, you know, this is no way.

So that one who did it first, it’s like, oh no, but I’m sorry.

Innovation can be fleeting. You know, you only for a while will you have that advantage then become like everyone else.

But I can’t make a chocolate bar and call it cuts kit. You know, I can’t do that because they will take me to court and say, they’re trying to look like us. And so distinctiveness is, distinctiveness is different.

So let’s just recap what we’ve talked about and then we’ll make a little shift. So we’ve talked about, you know, a bit about your book, Mental and Physical Availability, Distinctiveness and Differentiation and how these distinctive brand assets work. I know you have an event coming up, you know, in the US, Singapore and Europe around how brands grow, but it’s tailored toward execs, right?

So what is this event about? And are there any strategies that you’re talking about here that, you know, we haven’t talked about that are worth talking about?

Okay, well, I don’t know how long this podcast is going, but they’re like a three, four day event. Yes, well, let’s just say cover a lot more. So what they are is a, they’re a deep dive into, I mean, we call them how brands grow for executives, meaning that individual people can sign up and come along.

So that’s the executives and we call it how brands grow because that’s sort of, you know, it’s going to cover fundamental things, but it’s a very deep dive. So I absolutely promise anyone who’s read how brands grow a dozen times, they’re still going to learn new things if they come to this, you know, how brands grow is written.

Can you give us some goss? What are some newbie, new things?

It really is a deep dive. So there’s a difference between, there’s all sorts of different levels of learning, right? I mean, you read how brands grow or a book or, you know, you read something about, I don’t know, evolution, natural selection, you know, and you get, you know, you go, Oh, right.

I’m familiar with that now. And then what are the implications? Oh, wow.

That’s another level for me to think about what the implications are. And how would that, you know, how would that apply to what you’re going to do tomorrow? You know, that’s a big step in thinking.

And then could you actually teach that to someone else? Could you explain to them why decision A was not the best one, decision B is a better option based on these principles? Can you do that?

That’s another level again. And so How Brands Grow for executives is about really getting your hands dirty and thinking deeply about some stuff and challenging. So the idea is that, you know, people come out of that with a far more useful, but I can actually apply this next week.

So taking the knowledge and applying it in a meaningful way.

Yeah, we will make, you know, the participants there will have to, they will have to make commitments about what they’re going to, what changes they’re going to make, what things are going to be more of, what things are going to be less of, what things are going to stop.

So decision-making.

We’ve done this for the sponsors many, many, many times, right? But inside the operations, this is the first time that someone who’s not a sponsor of the Ehrenberg-Bass Institute can just get out the credit card and come along. So yeah, we know they have amazing events.

Yeah, I’m going to enjoy them.

All right. Well, thank you for sharing that. I wish there was some more gosh, you could share, but I understand you have to be there too.

You could try. I did try.

I don’t want to take away this, but also some of it is quite deep. You can exercise for an hour where they’ve got real data and they’re working through and comparing this. This is a podcast.

We have to keep it live.

Let’s shift here. I want to get into some things that grind your gears, like misconceptions around growing brands. What are some misconceptions that you see in the marketplace?

What is annoying me? I love there’s a little industry that loves to like, I mean, all what a tailor says, haters got to hate. There’s always some people who want to sort of big note themselves and things.

So, oh, yes, I’m a classicist. Well, that’s all completely wrong and then I’m not completely wrong. And then, well, okay, no, it’s mostly right.

But, yeah, I always knew it anyway, you know, right. So I don’t, yes, so what can I tell you? People who on one hand will say things like, Oh, Ehrenberg-Bass Institute are black and white.

They’re too dogmatic, you know, we need nuance and context. Okay, that’s great. And then they’ll put up some stupid straw man type argument of like, Ehrenberg-Bass says there’s no differentiation.

We don’t say that. We say the opposite always. So, you know, straw man is where you put up an argument that’s so easy to knock over.

So you say people are saying something that just isn’t. Ehrenberg-Bass say there’s no loyalty. No, actually, we say the opposite.

We say, loyalty, if you had to describe consumer behavior, the most fundamental thing about consumer behavior, it’s that consumers are naturally loyal. They just keep going back to the same brands that they find easy to buy because of their mental availability and because of the physical availability where they live and things. And so, yeah, that’s the most fundamental thing.

So we don’t say there’s no loyalty. We say there’s absolutely no loyalty. But what we do say is you’re going to get the amount of loyalty that you deserve given how big your brand is.

You can’t just magically go, no, no, no, I’m going to small brand. It’s hyperloyalty.

Do you think the larger the brand, the more loyal the customers are? Is that like a general rule?

Yeah, that is the double jeopardy law, which says that bigger brands, which have vastly bigger customer bases, how do you have more market share? You have to have more people buying you more often. Or you could have a few people buying you a lot more often.

But double jeopardy says, no, no, it’s always the same. You have a lot more people buying you, and they’re a little bit more loyal. A little bit more loyal.

So, yeah, if you get to be a super duper huge bank, you will get slightly less customer defection. Not a lot, but a little less customer defection. And we now know why.

It’s because big brands are sort of hard to get away. They’re harder to get away from. It’s easier to forget a small brand.

It’s easier to live a small brand and drop out of your life. It’s hard. I always joke that most times when I eat at McDonald’s, I say to myself, you know, never again.

But I know I will, right? I mean, it’s a pretty amazing brand. Physical and mental availability.

I know that I’m a light McDonald’s, irregular McDonald’s consumer, but I know the whole menu. I know the prices I pay. I know where the stores are.

I mean, I know what they look like. Wow.

That’s why it’s a very big brand. So big brands get a bit more loyalty. Yeah, so it annoys me when people say things like, Ehrenberg-Bass has no loyalty.

They’ve taken things out of context.

Yeah, it’s just they’ve just been, some people are just being smart, Alex, really. They want to say, look at me, look at me, I’m so clever. And I think if you’ve got a genuine gripe, if you think we are underplaying the importance of differentiation, say, don’t just go, I don’t believe I don’t like it or put up a straw man.

Go and collect some evidence. Go do something proper that we can do. And don’t do weird modeling that no one can tell what you’ve done.

Do something like we did. We put out real world things that anyone can check. Go do that.

It’s like, you can’t just say I don’t like it, you know. I don’t like quantum mechanics. I don’t understand it.

Well, yeah, most of us don’t. It’s really weird. Yeah.

But anyway, it works. If you want to dismiss it, you’re dismissing the last hundred years of modern physics, which means you need to do some work, not just say, I don’t like it.

So I’ve got a question. Do you find a lot of your research is B2C, at least from what I can see.

Do you find it? You can go to the Ehrenberg-Bass website and there is a free huge report on B2B.

Excellent. I will do that. So, but anyway, seeing as you’ve done that, then that follows on nicely.

Do you find that the laws shift at all or do you find them always the same, whether we’re B2B brands or B2C brands?

Well, probably the surprise was how similar B2B are. The fundamental laws really do hold.

Industrial buying the Pareto can be more extreme. Your top 20% of customers can give you a lot more of your volume. But that’s because, unlike households.

Households vary in size between 1 and 2, but there’s a few of 4, 5, 6, but not many. Whereas when you’re selling to firms, you can be selling to a firm that employs 50,000 people and a firm that employs 5 people, so there’s way more variation. So that’s a difference.

What are the marketing implications of that? One of the most simple segmentation things for anyone in B2B is how big is the company that we’re selling to? Because all segmentation things should be really simple stuff like that.

It gives you a really good idea about how much they can buy from you. They’ve only got 5 employees. Well, that does limit the amount.

Say, I know you’re selling a workplace safety training thing. Well, they’ve got 5 employees. How many times can we sell it?

I think 5 times. So that’s different. But otherwise, no, the big surprise is just how similar.

And I think this is really getting through in the B2B community. People are starting to realize, well, actually, outside of mining and commodity, a few things like that, the world is still built on brands. And say you’re selling software as a service, there’s still a battle for mental and physical availability.

Definitely. So I think they’re a bit behind. They’re still sort of perhaps very much in that Kotlerian world of, I don’t know, if our software is a bit better, better being defined by us, then it’ll just sort of sell itself, right?

No.

So in the book, you discuss continuous brand exposure. So is this something that all B2C and B2B companies and personal brands should be adhering to, this continuous exposure of your brand for that availability?

Yeah, that’s a really good question. Yes, that is one of the, there are two golden rules of media, I don’t know, by media to advertising and reach people or publicity. And the first is you need reach.

If you want to grow, you need to reach more people. If you can potentially sell to say, you know, your market is a billion people on the planet or in your market, then you need to reach all the billion of them. The second thing is, well, I probably have to do that more than once.

Yeah, you have to keep on doing that. So the second golden principle is because we don’t have limitless money, is spread your money out. That’s the cheapest way that you’ll get more reach and more coverage in time.

If you spread it out, unless you’ve got massive, if you’ve got a massive budget, then sure, you buy us twice in a day or seven times in an evening. But most of us don’t have anything like that. So spread it out.

Don’t run an outdoor campaign for three weeks and then have all the other weeks of the year that you’re not there.

Spread it out in time and in place too. You can see an outdoor ad and then you walk 100 meters and you see the same one again. And you think either their budget is enormous and they plaster these over the whole city, 100 meters apart, or they’ve spent too much of their money on this road.

And I bet there will be hundreds of other roads with just as many cars and people walking along and you’re not there at all. And that breaks the rule of spreading out. So yeah, I think as a good practice rule, I don’t know of any…

Oh, no, sorry. It would be everywhere. No, you break that rule if you had a time constraint, if you were launching a new movie.

And it’s going to be opening in cinemas on Tuesday. And then if we don’t get a lot of bumps on seats, it would be gone within a week or two. And then you don’t have the luxury of spreading.

You’ve got to burn money.

That’s more like short-term, though, isn’t it? If you’re playing the long game, as you were saying, you’re trying to build the brand.

Yeah, a movie is a weird thing, right? It has a very short cut.

But I know what you mean. Hear what you’re saying. Yeah, you wouldn’t then spread it.

You’d invest and go bang, wouldn’t you, as quick as you could in a very short, sharp way?

Yeah. Also, if you’re going broke, if you thought, you know, there is going to be, we’re not going to be around next year. Sure, there is no long term.

But if you do, and most brands do hope to be around next year, then the best way to spend your money is to, as far as media and communicating with people, is to spread it out. Because most people aren’t in the market at the moment. So if we spend all our money this week, then maybe 1% of our people were in the market this week.

So 99% of the people that we hit couldn’t buy from us. We’re going to. I would have sort of preferred to keep some of my dollars back then, so that I could reach them later on, when it was a bit closer to when they were going to buy.

That’s such an important point. And just to reiterate that is like most of the time people aren’t buying, like ready to buy. So it’s like that continuous exposure.

And if you show up, provide value, build your authority, you build that trust over time, you can make that connection with the user and eventually they may buy from you. So I love that.

Jenny likes to say the biggest search engine in the world is between people’s ears. When they do go to buy, they go, do I know how to do this? Do I know a brand that will suit me?

And if the answer is yes, if something comes to mind, then they don’t do a lot of other searching. So that’s just a fantastic, that’s what you want. And it will take a while to do that.

And you will be hitting a lot of people this, who aren’t in the market.

It’s an incredibly simple way to wrap back around to mental availability, the search engine in your head. I think we’ll leave it at that Byron. It’s been an absolute pleasure digging in.

Thank you so much for indulging us and answering our questions.

It’s been a blast. Thanks so much for coming on Byron. We really appreciate it.

I hope to see you at How Brands Grow for executives.

All right. It is in the US, Singapore and Europe for our listeners. And there’s more information on the Ehrenberg-Bass Institute website.

Before you go, Byron, can you just share anything else you’d like to with our listeners? For example, where we could find you or any other key takeaways you want to share?

Well, we’re a B2B brand. I mean, we’re a university. So LinkedIn is a huge channel for us.

So, yeah, follow me on LinkedIn, on Twitter or whatever it’s called nowadays.

It looks like they say X previously known as Twitter, don’t they?

Is it clever because it sort of gets you publicity? I don’t know, but in general, I would not advise anyone to just change their brand names.

Anyway, thank you so much, Byron, and all the best. Cheers.