Beyond Meat And Its Trust Deficit

On August 8, 2023, Beyond Meat, the company that makes plant-based meat alternatives, tanked. Reporting its second quarter performance, Beyond Meat missed analysts’ expectations. Beyond Meat’s revenue for second quarter was down 30.5% compared to the same quarter in 2022. Many analysts have lost enthusiasm for Beyond Meat with four analyst groups listing Beyond Meat as “Sell” and four listing Beyond Meat as “Hold.”

The poor performance is not a surprise. Almost a year ago, in September 2022, The Wall Street Journal ran an opinion piece “Beyond Meat is Beyond Hope”. The author stated that Beyond Meat’s problem is that there are just too few people who will eat its products. The writer pointed out that the pool of vegetarians and vegans is too small for profitability. Only 5% of Americans say they are vegetarian while 3% identify as vegan. 

However, as The Guardian pointed out, the non-dairy milk category is booming. At the time, The guardian wrote: “Dairy alternatives now make up 15% of the market and are worth $2.5 billion. A third of Americans drink some kind of non-dairy milk weekly.” The prospective people are out there: just give them relevant, differentiated reasons to buy.

There is a lot of Monday morning quarterbacking stating that plant-base food is a fad. On the other hand, there is a significant lobby believing that plant-based protein is a more sustainable, more innovative food system with a lot of growth potential.

Underlying Beyond Meat’s laggard performance is this: Beyond Meat has a trust deficit. Customers and prospective customers are concerned about how the product is made. Beyond Meat products are perceived to be too processed. And, for vegans, vegetarians and organic eaters, processed is a dirty word. Trust is an essential element for a brand.

There are many reasons why Beyond Meat has a trust deficit. Beyond Meat did not appear to build a compelling, relevant, differentiated brand.  Rather, Beyond Meat always seemed to be a company with innovations. Beyond Meat never seemed to communicate its benefits to customers and prospective customers. Beyond Meat products have been and still are priced at a premium to animal proteins. And, these are just a few reasons.

Now, Beyond Meat wants customers and prospective customers to perceive Beyond Meat plant-based products as trustworthy. Beyond Meat wants people to believe that Beyond Meat products are OK to eat; not processed, but created. Beyond Meat is running a communications campaign to address its trustworthiness as a food stuff. But, again, at the moment, there is no discussion of the total brand experience; no addressing of Beyond Meat’s functional, emotional and personal social benefits.

Beyond Meat has a mission. Founder and CEO Ethan Brown stated this at the earning call:

 “As we look to the future, we remain steadfast in our belief that plant-based meat, and Beyond Meat specifically, will play an important part of the global response to a climate crisis that appears to be rapidly intensifying, while also delivering health benefits to the individual consumer.”

Beyond Meat’s mission is laudable. However there are complications. A research study cited in The Guardian shows that even when people learn that huge reductions in meat consumption are essential for climate-change avoidance, people are reluctant to change behaviors when the environment is “the sole beneficiary”. Self-interest overcomes altruism. A different study from Purdue University shows that even when confronted with information about meat’s carbon footprint, people still prefer meat over plant-based alternatives

A food analyst at Mintel, a global market research company, said, “Awareness of the impact of meat on climate change is expected to underpin long-term demand, although products featuring more natural vegetable and vegetarian proteins, such as chickpeas and lentils, were likely to lead growth as consumers sought more transparency and reassurance about the origins of ingredients in vegan ready meals.”

According to the press, Beyond Meat has a marketing campaign with the title, There’s Goodness Here.” This Beyond Meat campaign aims to “demystify” the way in which Beyond Meat’s products are created. For example, did you know that The American Heart Association certified Beyond Meat’s Beyond Steak as a heart-healthy food? Did you know that Beyond Meat’s products are labeled 35% less saturated fat?

One online source describes the ad campaign as follows:

“In the first phase of the campaign, consumers visit Munich, North Dakota to meet a 5th generation farmer and father who grows fava beans for Beyond Meat’s plant-based heart-healthy steak, which was recently certified by the American Heart Association for meeting its exacting nutrition requirements. Fava beans, which naturally enrich the soil with nitrogen, can enable healthier fields without the use of harmful and expensive fertilizers. This benefits farmers, consumers and our big beautiful planet. In addition to fava beans, Beyond Meat sources clean, simple, non-GMO plant-based ingredients like peas, rice and wheat. This farmer’s story and others like it underpin the goodness that is the beginning of Beyond Meat’s product journey which uses wholesome plant-based ingredients and a simple and clean process to create nutritious food options that are also environmentally friendly and kind to animals.”

This idea of taking people behind the scenes is good. It is one of the critical steps necessary to build trust. Openness Is an Opportunity 

Transparency is a key to trust. Transparency requires truth. Truth is not the same as trust. Truth is a fact,; trust is a feeling. To build your brand into a trustmark, you need both truth and trust. To be worthy of a customer’s trust, people need to see the truth and not just read about the truth. By taking customers behind the scenes, Beyond Meat is telling customers, “We have nothing to hide.” “See for yourself.”

In our fast-information-access, knowledge-sharing world, transparency is important. Increased emphasis on transparency affects trustworthiness. It is only a matter of time before the public discovers the facts about any issue. There are no secrets. There is nowhere to hide. Beyond Meat has discovered that people actually do read the labels. And, what the Beyond Meat labels indicate is more process and less made-by-nature.

By relying on a family farm to deliver a message, Beyond Meat is opting for a more convincing messenger. It is easy to rely on traditional advertising to tell someone what a brand stands for. It is more convincing when others tell the story on the brand’s behalf. And it is even more convincing when people can learn the truth for themselves. 

However, there are other essential steps to build trust. Beyond Meat must not simply hang its hat on openness. Beyond Meat must invest in the following trust-building efforts.

You Are What You Do 

Beyond Meat must display trust before Beyond Meat can declare it. Customers must consider Beyond Meat worthy of trust before they commit to trusting it. Saying, “trust me” does not track with today’s customers. 

Beyond Meat must provide iconic tangible, visible evidence that what Beyond Meat claims can be trusted. Iconic products or services are tangible demonstrations of the truth of Beyond Meat’s claim. Labels matter. Looks matter. 

Part of its new campaign is a demonstration of Beyond Meat’s tangible evidence of its “goodness.” Beyond Meat will need more than advertising to showcase its evidence.

Trust is the confidence that a brand will live up to expectations. This means that the promised expectation of the brand can be relied upon. 

Lead the Debate; Do Not Hide from It 

Staying silent when there are big issues at stake is not a signal of leadership. Silence means agreement, and trust is too important for silence. Leaders stand up for what they believe in. 

Beyond Meat stayed silent on the issue of “processing” even when the cattle industry came after Beyond Meat with very easy-to-grasp messages. Getting ahead of the issues is critical. Beyond Meat failed to do so.

For example, years ago, Domino’s could have taken a defensive position when customers complained about the quality and taste of their pizza. Instead, the brand agreed that its offerings were below par and told us so in national television advertising. 

If you are in the food business and you are selling food people think is questionable, fix it. Going on the defensive is the wrong approach. For a brand to be taken seriously, a defensive posture implies that you have something to hide. When you are silent or when you hide, others can create the truths about you. Others, such as the cattle industry, will recast your profile. A brand will have a reputation. The only question is who will have the strongest voice in managing that reputation. It is not in a brand’s interests to let outsiders trample on a brand’s truths. 

Rather than hide from an issue, lead the debate. Take positive action. Tell your story. When you tell your story you win. When you are silent, you lose. Trust leadership is more than just standing out. It requires speaking out. In revitalizing a brand, it is necessary to speak up for your brand if you want your brand to stand out. 

Trustworthy Messages Must Come from a Trustworthy Source 

How you say things is as important as what you say, especially in a world where conversations occur online digitally and through blogs, apps and with a limited number of characters. 

Just as peer testimony is more trustworthy than corporate testimony, the voice of the customer is more trusted than a corporate voice. So, it is helpful that Beyond Meat is showing customers and farmers.

Beyond Meat will also rely on health organizations to deliver the “goodness” message. In a polarized society this may be an iffy approach. True, Beyond Meat’s products are recognized by the American Heart Association, which certified Beyond Steak as a heart-healthy food. Additionally, Beyond Meat will rely on a clinical study from Stanford University (The American Journal of Clinical Nutrition). The study looked at the benefits of replacing animal-based meat with Beyond Meat’s plant-based meat over an 8-week period.  Results showed improvement in key health metrics when participants replaced animal-based meat with Based on the positive outcomes of the study, Beyond Meat created the Plant-Based Diet Initiative at the Stanford University School of Medicine. Beyond Meat also has an agreement with the American Cancer Society to advance research on plant-based meat and cancer prevention.

Providing trustworthy information is critical. The challenge is to become a trustworthy source of information that is helpful, convenient, understandable, and valuable to your customers. Become an open source of information that is understandable, accessible, timely, and trustworthy. 

Beyond Meat has a trust deficit. This trust deficit was self-created. At Beyond Meat, there seemed to be a sense that people would overlook the product-generation because the idea of plant-based meats was so enticing. Consumers are not like that anymore. “Trust me, this is good for you and sustainable” is not a viable message.

Beyond Meat must build trust. Brands live and breathe with trust. Without trust, brands have little value. If trust in the brand is high, then the brand has great value. But, if trust in the brand is low, then the brand has little value. If there is zero trust, there is zero value, as zero times anything is zero. Brand value leads to enduring profitable growth.

Banana Republic, Lifestyle And The Age of I

Banana Republic, Lifestyle And The Age of I

We live in The Age of I. Banana Republic wants to leverage this phenomenon.

The Age of I refers to the tension between two strong human desires: the need to belong (inclusivity) and the need to have a unique identity (individualism). It is an overarching paradox that drives attitudes and behaviors. People want to be seen and respected as individuals with special characteristics. But, people also want to belong to something bigger: a community, a network, a business, a family, an ethnic group, a religious institution, a union or a nation. People want to be independent and interdependent at the same time.  People want to be self-expressive, while at the same time acceptable to a community.  

Trading off between these two desires is uncomfortable and difficult. Data show that the personal self and the social self mutually reinforce each other.

In our increasingly digital, networked, mobile environment, it is easy to be oneself and part of a group at the same time. Ubiquitous technology and online communities allow people to create different social identities depending on the group in which someone participates. 

But, digital is not completely satisfactory. Humans are social animals. People may opt for Spotify but there is nothing like attending a music festival. This desire for individualism and inclusivity in real life is powering one of the major manifestations of The Age of I: the desire of brand-businesses to become lifestyle brands.

Lifestyle brands create communities. Lifestyle brands generate emotional and social values that connect with particular customers, exciting these customers to want affiliation with the brand. At the same time, lifestyle brands are based on the idea that individuals have their own unique identities. These identities reflect customers’ values, hopes, opinions, experiences and wants. The ability to personalize products and services within a real-world physical, emotional and social community is a sought-after experience.

There are many lifestyle brands on the marketing landscape. Ralph Lauren, Anthropologie, Restoration Hardware, Goop (the wellness lifestyle brand-business) and, now, Barbie, are a few.

Anthropologie states the following: 

Anthropologie is a unique, full-lifestyle shopping destination, with a mostly exclusive assortment of clothing, shoes, accessories, beauty, furniture, home décor, garden, bridal and more.  

Our customers are creative people who want to be and look like themselves. They have a sense of adventure about what they wear and take a thoughtful, personal approach to interior décor and the harmony of home. Although personal style is important to them, they’re not governed by trends. We listen to our customers and community for inspiration and feedback – the intention is to exceed their every expectation in unexpected ways.

Ralph Lauren states:

Our Purpose at Ralph Lauren is to inspire the dream of a better life through authenticity and timeless style. Each word is deliberate, deeply rooted in our history and in our culture. Inspiring the dream of a better life is not about material status, but about a life filled with hope, possibility and a sense of realness that never goes out of style.

We do this The Ralph Lauren Way – love what you do, be passionate, work hard, embrace individuality, work together, take risks, stand up for what you believe in and aspire to the best. The Ralph Lauren Way is what built this Company; these values are enduring and will help carry us into the future.

Lifestyle brand-businesses focus on embodying beliefs and behaviors that have meaning for a specific group.  Lifestyle brand-businesses aim to encourage, entice and excite people to want to belong to the community. Lifestyle brand-businesses want their products and services to help define how the customer wants to define their way of life. 

The latest entry into the lifestyle experience is Banana Republic, part of the Gap group. Banana Republic wants to become a lifestyle brand. This means adding home goods to the established clothing line. And, according to Banana Republic, the lifestyle strategy could mean adding hospitality.

According to The New York Times, Banana Republic is selling “… home textiles… having rolled out throw blankets, rugs and bed frames….” Banana Republic CEO, Sandra Stangl, indicated that the inclusion of home décor items gives Banana Republic “a bigger addressable audience.” CEO Stangl also admitted that adding these home-oriented items will help to “stabilize” the bran-business, as the pandemic and changes to work behavior and dressing impacted Banana Republic sales.

Observers are not particularly upbeat about Banana Republic’s lifestyle brand-business strategy. It is not just that the competition is tough. Will Banana Republic be able to capture the values, aspirations, attitudes of its target audience in ways that optimize the paradox of The Age of I? Will Banana Republic be able to satisfy individualism and inclusivity? Can Banana Republic create a world in which people can be self-expressive while wanting to belong in a Banana Republic-defined world?

One issue is how Banana Republic sees its market segment. According to the brand-business’ chief commerce and experience officer, Banana Republic has an opportunity because “… no company has more than 5% of the home market.”

This comment is a red flag. 

A market is a want: a customer want. If there is no want, there is no market.  A market is not a category: there is no home décor market. There is no lifestyle market. For Banana Republic to be successful, the brand-business needs to focus on the “want” for its lifestyle brand: who are the customers, why do they want this brand and what is the context for this brand? The retail lifestyle brand-business landscape is not unidimensional. Which brand-business is Banana Republic’s competitor according to customers?

There are probably many different customer-defined markets for lifestyle brands. Banana Republic does not define the market: customers do. Ralph Lauren or Anthropologie would probably say they are not competitors in the same market as Banana Republic. Nor would Ralph Lauren and Anthropologie agree that each is the other’s competitor.

Banana Republic is not alone in the pursuit of a lifestyle strategy. The Wall Street Journal reported that H&M, the Swedish fast-fashion brand-business is moving towards a lifestyle approach. H&M is adding home décor as well as makeup and brand-name items. And, then, there is Sporty & Rich, highlighted in The New York Times. Once an Instagram account; now, a lifestyle brand-business aiming to be “a younger person’s Goop.” The New York Times labeled Sporty & Rich as “ a brand world.”

Lifestyle brand-businesses are important in The Age of I. But, customers are savvy. Having a bed frame does not make a lifestyle. Banana Republic needs to define its market space, own it and then consistently deliver. What is the driver of Banana Republic’s ability to offer independence and interdependence, or as one professor states, our desire for separability and situatedness? In other words, what is the definition of Banana Republic’s optimization of individuality and inclusivity? Rather than starting with a bed frame, Banana Republic must articulate its promised experience in ways that are both provocative, persuasive and profitable.

Allbirds: Adore the Core

Customers’ needs may alter. Markets may change. New products challenge the status quo. No matter how a brand-business landscape morphs, there are some evergreen brand-business marketing principles that must never be forgotten.

One principle is this: keep the brand-business core strong. A brand-business’ core must be continually re-energized, protected and strengthened. It is the brand-business core that will profitably finance a turnaround, keep a brand-business growing and provide a platform for the future. Ignore what core customers love about your brand-business at your peril.

This is the current situation at Allbirds, the sustainable shoe enterprise. According to The Wall Street Journal, Allbirds, once a Silicon Valley statement footwear brand-business, has “lost its way.” Allbirds lost its way by looking beyond its core base; by coveting others at the expense of Allbirds lovers.

Core customers already know what is great about a brand. When a brand-business expands beyond its core group, the brand risks losing its core group. When this happens, the goal must be to restore and repair core customers’ relationship to the brand-business. It is imperative to reinforce what core customers like about the brand. Encourage core customers to frequent the brand more often.

This is exactly what did not happen at Allbirds. And, now, recognizing the problem, Allbirds is making strategic changes to re-excite its core customer base. This is good. But, how Allbirds goes about its changes needs to be reviewed.

Stop the Bleeding


Allbirds first step is stopping the bleeding by trimming shoe and clothing options, opening fewer stores and creating more compelling footwear. This is a strategic necessity.

More Loyal, More Profitable Customers


Yet, nowhere does the Allbirds strategy say that it will aim at core customer frequency.

Here is a fact: it is easier to get a customer who already uses your brand to come a little more often than it is to attract a new customer who does not use your brand at all. When a brand-business is in trouble, the brand-business’ objective must be to stop the shrinking of the customer base and to increase purchase frequency. A small increase in frequency can make a huge difference to brand health. Coveting customers you do not have is not a pathway to profitability. Furthermore, a focus on tactics and products that might seduce specious segments becomes a major and financial distraction.

Allbirds needs to convince its core customers to buy at least one more time a year. And, perhaps if possible, have these core customers buy just one more item each time they are purchase ready. For example, Allbirds has seasonal footwear as well as athletic footwear
Etsy, the craft website changed its strategy in 2017. Etsy recognized the need to increase frequency among core customers. Etsy stated, “… we disclosed that about half of our buyers only buy once a year on Etsy. And, we really believe there’s an opportunity to bring those buyers, our existing buyers, back to buy more things on Etsy. So making it so that our existing buyers come back more than once, I think, is a big opportunity. Because half of them only come back once.”

There are reams of data showing the value of a core customer. Seminal research from Frederick Reichheld on the lifetime value of a loyal core customer essentially showed that as brand loyalty increases, the likelihood of defection decreases. Mr. Reichheld concluded that reducing defections by 5% could increase profits by 25% and more. Other research indicates that loyal core customers are 8 times as valuable as those who just consider the brand-business.

The reverse is true as well. Losing a small percentage of core customers will account for a disproportionate amount of lost income.

There are data confirming that it costs 3-4 times as much to attract a new customer as it does to keep a customer loyal. And, now that there are so many digital, online options for media, researchers show that these attraction costs may be as high as 6 times more for non-core customers. Focusing on core customers, strengthening their core brand beliefs is an excellent way to build brand loyalty.

Of course, brands must manage attract new customers while creating more brand loyalty among its core customer base. But, when a brand is in trouble, the first priority is to stop the hemorrhaging of the customer base.

Know Your Core Customers


One of Allbirds’ founders told The Wall Street Journal that core customers tend to buy Allbirds’ products because of price, stylishness and comfort. These attributes are features, potentially, functional benefits at best. But, what about the brand-business’ emotional and social rewards? Focusing on features and functional benefits alone does not help in understanding the customer.

Repeatedly, The Wall Street Journal reports an Allbirds focus on the age of the core customer and the age of the desired new customers. Is there a real understanding of the core customer and like-minded others that does not depend on age? Viewing the audience by age alone is dangerous.

Based on the original promise and mission of the brand-business, age was not a factor: personal values and rewards were key drivers. Sure, values and rewards shift as one ages, but not for everyone. And, many younger customers share or adopt values with those who are older.

Love your core customers if you expect them to love you. Ultimately, the brand-business’ aim must be more customers, more often, more brand loyal, more revenues and more profitable. When a brand has lost its way, the first focus must be to shore up the core customer base. In other words, adore the core or your brand is done for.

Bed Bath & Beyond

Becoming A Brand Beyond Current Identity

Ordinarily, unfairly capitalizing on the familiar brand identity of a known brand would be brand dilution. The entity using the known brand’s identity can be considered a parasite. A parasite brand is a brand that lives off the brand equity of another brand. No imitator, no copycat, no parasite should be allowed to steal another brand’s identity. That is the same as getting a free ride.

Parasite brands decide that their only way of developing brand authority and a brand promise is not to develop their own authority or their own promise, but to steal the identity of another. These parasite brands not only build their own sales, but they unfairly transfer the known brand’s promise. They unfairly transfer the known brand’s authority. The result is that these parasite entities lessen the known brand’s brand value.

Many trademark cases are based on different versions of this type of brand equity dilution. 

But, when money buys a well-known brand name along with its identity and other intellectual property, thus gaining the ability to use that brand name, it is considered brand management genius.

And, that is where we are right now.

After a year or more of failed strategies and rejected lifelines, Bed Bath & Beyond filed for bankruptcy. Everything was up for bids. Overstock.com, the internet close-out merchandise retailer that sells home furnishings, home décor, bedding and a variety of other home goods bought the rights to the Bed Bath & Beyond’s intellectual property.

For $21.5 million, overstock.com bought Bed Bath & Beyond’s “… website and domain names, its trademarks, trade names, patents, customer database, loyalty-program data and other brand assets related to the Bed Bath & Beyond banner.”

According to The New York Times, overstock.com indicated that beginning in August (after all Bed Bath & Beyond brick-and-mortar stores close), people clicking on overstock.com will be “redirected” to bedbathbeyond.com. Overstock.com will also rename its mobile app and loyalty program. The New York Times also wrote that overstock.com will consider changing the name of the overstock.com business entirely.

This is a paean to the Bed Bath & Beyond brand. And, a sorry coda to the iconic retailer. Why? Because overstock.com stated that it has looked at many options that would successfully change its image as a liquidator. Regardless of the ways in which overstock.com changed its merchandise, overstock.com could not shake its image as a seller of left-over, clearance goods.

In other words, overstock.com plans to use the brand promise of Bed Bath & Beyond to ditch its customer-perceived liquidator image and become a retailer that “…makes it easy to feel at home!” which was Bed Bath & Beyond’s mission.

The $21.5 million question is whether this name change will work. The Wall Street Journal urged investors to be cautious, as resuscitating failed brands has not been as profitable as one would think. The example used is Retail Ecommerce Ventures which bought Pier 1, Modell’s Sporting Goods and Stein Mart.

Further, since there is no legal definition of a brand, there is no way to “buy” the Bed Bath & Beyond brand experience. Buying the trademark is not the same as buying the brand. Brand and trademark are two different entities.

Trademarks exist for one basic reason: to enable the public to easily identify a particular product or service that derives from a particular source.  Trademark law protects consumers from deception.  Different from trademarks, brands are promises of expected, relevant, differentiated, trustworthy experiences.  You trademark products but you brand promises.  That promise means that if you buy this brand, you will receive this experience.  And that promise comes from an authoritative (quality, leading, trustworthy) source.

Will overstock.com customers become confused? Will customers expect the new bedbathbeyond.com to deliver just like Bed Bath & Beyond? Will overstock.com be able to profitably capitalize on the familiarity of Bed Bath & Beyond. Will overstock.com be able to successfully adopt and adapt the Bed Bath & Beyond’s promise and brand authority?

It is unclear. But, transferring equity is not as simple or as quick as it may sound. Here is an example. 

In 1999, Electrolux AB bought back its name in the US from an equity firm. The cost was not even close to $21.5 million. The equity firm provided a new name for their business: Aerus. The Electrolux AB agreement with the equity firm was to offer a 5-year grace period in which Aerus could use the Electrolux brand name to transition customers to the Aerus name. Currently, on its website, Aerus shows its vacuums branded Aerus. Yet, for example, if you walk down Stone Way in Seattle, Washington (a major throughfare), you will find an Electrolux Aerus store. Has Aerus been able to infuse its own brand vacuums with the same quality image as Electrolux? Or must Aerus continue to prompt customers and potential customers with the Electrolux provenance? The store does not promote “Aerus with Electrolux vacuums inside.” The store is Aerus Electrolux.

Interestingly, but not surprising, after the overstock.com announcement of the Bed Bath & Beyond intellectual property purchase, The New York Times writes that overstock.com “…added more than 100,000 bedding and bath items to its site as vendors raced to do business with the company.”

Overstock.com must focus on developing its own trustworthy brand value for the new brand-business. Value creation is not solely about generating shareholder value. No company can create sustainable value for its shareholders without creating enduring value for its customers.  An enterprise cannot have sustainable, profitable growth of the bottom line unless there is quality growth of the top line. People value familiar quality, leading, trustworthy sources of relevant differentiated promises. 

The challenge facing overstock.com is to become a quality, leading, trustworthy source of a promised experience. Using the Bed Bath & Beyond name cannot make this happen without a lot of brand-business building by overstock.com.

For Twitter To “Make History,” CEO Vaccarino Must Become The Chief Trust Officer

Recently, new Twitter CEO, Linda Vaccarino, told the world that Twitter would be “making history.” CEO Vaccarino faces many challenges. Current business press describe Twitter’s challenges on a daily basis. One of Twitter’s most pressing challenges is its stultifying trust deficit. Twitter’s trust decay is said to be the result of Mr. Musk’s Twitter changes since his purchase of the social networking site. Here are just some of the issues highlighted by business writers and observers.

  • Advertisers are still “spooked:” by Elon Musk’s “laissez faire attitude about free speech and content moderation.” 
  • Elon Musk stated by March of 2023, Twitter’s ad dollars showed a slump of 50%-60%, depending on the specific press report. 
  • Fidelity Investments “cut its private valuation” of Twitter by one third. 
  • Mark Reed, CEO of WPP Plc, the world’s largest advertising organization, continued to advise clients that in regards to running ads on Twitter, clients should “proceed with caution.” 
  • Some big advertisers still stay away from Twitter as Mr. Musk eliminated the “guardrails” protecting Twitter from rampant “misinformation and toxic content.” 
  • New Twitter CEO, Linda Vaccarino, has as her first task to “stop the bleeding” of ad dollars. 
  • CEO Vaccarino told sales teams that “hand-to-hand combat would be on the agenda in order to “persuade” advertisers to return.
  • CEO Vaccarino’s job just became more difficult as owner Musk’s limits on user activity “… further erode” advertiser trust in Twitter. Said one industry director, “The advertiser trust deficit that Linda Vaccarino needs to reverse just got even bigger. And, it cannot be reversed based on her industry credibility.”
  • Fortune magazine reported results from a May 2023Pew Research Center study revealing that 60% of U.S. users had “taken a break” from the platform over the past year.
  • CEO Vaccarino defended Mr. Musk’s caps on allowable-number-of-posts-read by stating, “When you have a mission like Twitter you need to make big moves to keep strengthening the platform. This work is meaningful and ongoing.”
  • However, CEO Vaccarino’s statement and other Twitter statements appear to not be working. Fortune magazine reports that users “…continue to slam the company’s latest unpopular move.”
  • And, according to Bloomberg BusinessWeek on July 6, 2023, Meta’s Threads, its Twitter fighter, signed up 30 million users in its first 24 hours, 10 millions of these signed up in Threads’ first 7 hours, and there are currently 70 million sign-ups.  
  • The Wall Street Journal points out, Threads’ ability to entice advertisers is the real prize for Meta… and the real problem for Twitter. Facebook generates $115 billion in ad revenues while prior to Mr. Musk’s purchase and the loss of advertisers, Twitter generated $4.7 billion in advertising. Apparently, since its inception, advertisers have flocked to Threads. One reason is its Instagram base allowing advertisers to identify specific customers.

Amid its trust deficit situation, the now competitive market, and, hopefully, to galvanize Twitter’s employees, CEO Vaccarino articulated Twitter’s new mission and Brand-Business Promise. Ms. Vaccarino said, “Twitter is on a mission to become the world’s most accurate, real-time information source and a global town square for communication.” As for Twitter’s Brand-Business Promise, Ms. Vaccarino said, “…to drive civilization forward through the unfiltered exchange of information and open dialogue about the things that matter most to us.”

Two things. First, “unfiltered” exchanges are exactly what spook advertisers. Second, nowhere in the mission or promise do we read the word trust. Twitter wants to be accurate; Twitter wants to be an information source; Twitter wants to be a global town square for communication; and Twitter wants to be a positive change-agent for civilization. But, Twitter (and perhaps, Twitter’s users?) does not seem to care about being trustworthy.

This is problematic. To create positive, strong advertiser relationships, Twitter must become trustworthy. Trust is an essential asset in building and maintaining long-term relationships. Without trust, nothing else matters. Trust is indispensable when building a powerful brand-business.

To combat both internal and external trust deficits, CEO Linda Vaccarino must become Twitter’s Chief Trust Officer. Be the most trusted brand-business in every market in which you compete. Trust cannot be delegated. Trust is the CEO’s responsibility. Trust begins at the top. The CEO creates an enterprise and a culture.

Trust must be on the Twitter agenda. A powerful brand is more than a trademark; a powerful brand is a trustmark. For trust to develop, a brand-business must deliver its promise in a quality manner (consistently delivering against stakeholder expectations). 

With a new CEO, Twitter has an opportunity to become a trusted social medium in a world where institutional trust is in severe decline. CEO Vaccarino, in her role as Chief Trust Officer, should create a Trust Agenda that includes these four Trust building components.

  1. Be a credible source
  2. Have an excellent reputation 
  3. Be a pillar of integrity
  4. Have a responsibility ethic

Be a credible source

  • Twitter must become a credible source. Credibility means that what you say and do are plausible. Twitter must create believers. Is Twitter perceived as predictable, reliable and of quality? This means that users are satisfied. It means that users prefer the brand-business to alternatives. Fortune magazine reports that users are using Twitter less. Credibility means that Twitter must provide superior complaint resolution. And, must provide correct information.
  • CEO Vaccarino stated that Twitter would focus on becoming “the world’s most accurate, real-time information source.” At the same time, she indicated that Twitter would be “unfiltered.” This paradox promise of accuracy and unfiltered might work if Twitter were deemed credible. But, nowhere in the mission and promise is the idea that what you read on Twitter will be credible. If Twitter is not credible, then its information can be deemed not true and, then, not trusted.
  • Being a credible source means all stakeholders have confidence that Twitter provides true information. This is critical as communications from highly credible sources are more persuasive and more likely to be believed. 
  • A credible brand acts as a “quality” cue lessening client- and customer-perceived risk during decision-making. Credibility makes decision-making easier because the customer trusts the authority of the enterprise. 

Have an excellent reputation

  • Having an excellent reputation may be a tough challenge for Twitter. One of the troubling issues for clients has been the mercurial behavior of its owner. As pointed out in the business press, it is the “cavalier attitude” of Mr. Musk towards content that has sent shivers down advertisers spines. Having an excellent reputation means continually behaving in the same quality manner during each and every interaction. Reputation is a competitive advantage. 
  • Additionally, according to Bloomberg BusinessWeek, Mr. Musk has not been as transparent as he says he is when it comes to opening data to academics. Openness is critical for trust.
  • Reputation signals what a brand-business previously accomplished: its track record for quality, leadership, innovation and leadership. Think of reputation as a representation of the brand-business’ past behaviors and results. Twitter has a reputable past. But, there is a disconnect between Twitter’s past accomplishments and its recent actions. 
  • Reputation describes a brand-business’ ability to deliver valued outcomes to multiple stakeholders. 
  • Twitter does not create its reputation. Reputation is not something a brand-business determines.  Reputation is based on stakeholders’ perceptions. Reputation is the collective accumulation of stakeholder perceptions over time
  • Do not think that reputation is a theoretical construct. An excellent reputation facilitates client and customer decision-making. Reputation can increase business performance. For Twitter, this means helping to sell ad space at increased margin. 
  • It is not enough to say that advertisers have returned. Have advertisers returned with the same financial willingness? Are their budgets comparable to pre-Musk-ownership levels?

Be a pillar of integrity

  • CEO Vaccarino’s statements do not appear to cast Twitter as a pillar of integrity. And, maybe, Twitter does not want this role. The take-away is that in order for Twitter to be a transformed global town square, users and advertisers will be allowed to say and show what they wish… unfiltered.
  • Being a pillar of integrity means that all actions and behaviors, internally and externally, have the best interests of stakeholders at heart. Being a pillar of integrity means that stakeholders and others perceive Twitter as impartial and open-minded (Twitter is clearly focused on these two characteristics), but also perceived as respectable, just and unthreatening. Trust can help Twitter maximize these contradictory needs.
  • Integrity refers to a brand-business’s core values and purpose. Integrity derives from the brand-business’ guiding principles; the brand-business’ reason for being. Based on the limited information publicly available, it is difficult to know if any of Twitter’s underlying principles focus on integrity. Such principles should be basic truths and checkable claims.
  • As a pillar of integrity, a brand-business understands the value of its relationships with all its stakeholders. This value is more than monetary. Stakeholder value means generating a client and customer base that is larger, using more often, more profitable and more loyal. 
  • Integrity is seen through the eyes of all stakeholders. Does Twitter share values with its stakeholders? Does Twitter have stakeholder best interests at heart? Is Twitter accountable for its actions? Is Twitter perceived to be executing with ethical behaviors? Does Twitter have confidence in its employees? Who are the audiences for Twitter?

Have a responsibility ethic

  • Having a responsibility ethic means that as a global citizen or global forum, Twitter must behave positively on behalf of people, communities, nations and the planet. When Twitter states it wishes to be “the world’s most accurate real-time information source and global town square for communication,” Twitter must take some responsibility for what it does and what ensues. Complete freedom is anarchy. This is why we have laws. Having laws does not crimp freedom. Laws save freedom from anarchic destruction… or as Twitter’s mission of “unfiltered” appears to be advocating, participatory anarchism.
  • Responsibility can influence brand preference. Data show that a brand-business’ social reputation influences purchase decisions. Customers and clients are drawn to brand-businesses that “do good. These same groups are not averse to boycotting or publicly berating those perceived to be “not responsible.” 
  • CEO Vaccarino’s rejoining the Tech Coalition is a good first step. A pan-industry group, the Tech Coalition is dedicated to child safety. Owner Musk had pulled out of the coalition in March in order to save the $40,000 membership fee.

Chief Trust Officer is not a function. It is a fundamental leadership responsibility. The role of the Chief Trust Officer is more than a title. It is an indispensable trust-building task of major cultural significance inside and outside the enterprise.

As Chief Trust Officer, CEO Vaccarino must create and implement a trust agenda. A trust agenda provides direction for how the enterprise will build trust across geography, people, local communities, nations and time. A trust agenda’s goal is to create and reinforce trustworthy stakeholder relationships, which are the basis for high quality revenue growth.

art basel brand

Art Basel: Brand-Business Building Is Not Just For Packaged Goods

Branding is not just about advertising, although many marketers view branding as such. Branding is not just about message management or device management or digital management. Branding is about promising to profitably deliver an expected relevant, differentiated, trustworthy experience to a specific audience. 

Many pundits argue that brand management is best operationalized in the realm of packaged goods, such as the stuff that P&G sells. But, as the worlds of automotive, appliances, computers and farm equipment show, branding is vitally important in durable goods. Brand is also critical to the success of luxury goods. Some of the world’s best known and best-marketed brands are luxury goods. So, it is not surprising that brand is now front and center in the world of art. As one gallerist stated, we sell luxury items at luxury prices.

Recently, the future of Art Basel, the international art fair, has been linked with being a successful global brand-business. Mr. Noah Horowitz, Art Basel’s new CEO, and James Murdoch (Mr. Murdoch’s private investment firm, Lupa Systems, now holds 49% of MCH Group, the Swiss parent of Art Basel) have been quite vocal on the potential of Art Basel to become a major global, cultural brand, similar to Formula One.

Both leaders spoke out on the subject. The vision for Art Basel is to be a cultural experience that draws on and “engages” other cultural forces such as fashion, film, music, design, cuisine and connections, with a mingling of social classes. Of course, at Art Basel, there is the job of delivering high-end art pieces from galleries to clients. But, surrounding this upscale mercantile necessity is a vibrant sociocultural gathering and economic marketplace. Mr. Murdoch has cited Formula 1 as an example of such a happening. For example, when Formula 1 comes to Miami, the experience goes well beyond the actual race. Think reserved best-of-Miami-restaurant tables on Miami Beach, for example.

According to Mr. Murdoch, the vision for Art Basel is similar to a ‘traveling circus” that appears in a city with various contiguous events – not just buying and selling art but entertainment and dining, attended by people of various social classes. The traveling circus becomes a “a gathering, a center of gravity” for a significant cultural co-mingling and creation.

In the mind of Mr. Murdoch, there are few “brands” that can pull off such a feat. Formula 1 can. And, so can Art Basel. TED had this for a while. Its concept of Ideas Worth Spreading was, at one time, the de rigeur place to bring your vision. But, TED has not generated the ancillary “marketplace” for and engagement with the cultural community about which Mr. Murdoch and Mr. Horowitz speak. And, its audience for its two main conferences was not socially flat.

This type of movable, cultural festivity is not a new idea. The vision for Art Basel is similar to Medieval fairs. Medieval fairs were significant economic events in Medieval towns. Merchants across various European towns would come together to buy and sell goods. Vendors would sell items like rugs, textiles and spices. Medieval fairs were the main way merchants could sell and trade goods, locally and internationally. But, around the merchants’ stalls, contiguous to the fairs, were social happenings. There was entertainment provided by jesters, jugglers, magicians, poets, musicians, strolling players, dancing bears and plays. People danced, played games, ate and drank. Part of the cultural co-mingling was the fact that people from different backgrounds came together. Aside from merchants, there were locals, itinerants and the international sellers; there were peasants and nobles. The fairs were a source of amusement, enjoyment and allowed people to step away from their daily, possibly, mundane lives.

Building a brand-business, however, is not just having the vision. Building an Art Basel brand-business is a strategic, ongoing plan. What is the Art Basel Brand-Business Promise? What is it that Art Basel will deliver, to each participant, time and again, that is relevant, differentiated and trustworthy? What are Art Basel’s functional benefits, emotional and social rewards, values of the participants, personality of the brand and features that support these criteria? 

Before Art Basel can become a powerful brand with its powerful purpose, the Brand Promise must be clearly defined. 

Although not yet fully formed in statements to the press, Mr. Murdoch and Mr. Horowitz have, in some ways, articulated the purpose of Art Basel: to be a powerful, cultural gathering of community and connectivity – a center of gravity in the cultural space – with a focus on the artistic and cultural life of the area.

(In many ways, this purpose reflects the tug-of-war in the luxury arena between being the purveyor of very expensive luxury goods (i.e., art) and the all-encompassing socioeconomic theater of cultural expression. Many luxury brands struggle with being available everywhere and being rare. There is no question that the selling and buying of high-end art is a luxury enterprise.)

Think about how one creates a Brand Promise. First, one must define who the brand will be for: who are the people for whom this brand will appeal? Interviewed, Mr. Murdoch suggested the potential audience, outside of the buyers of luxury art, are those who have an appetite for culture; who are truly excited by the changing and challenging world of fine art, film, music, food, beverage and fashion. These are individuals who want to be connected “to the creators who are developing new ideas,” many of whom are community-based.

Second, what are the emotional and social rewards these people who are not potential buyers of luxury art want from their Art Basel experience? What are the emotional and social rewards of Art Basel for this identified audience? Mr. Murdoch hints at the benefits for participants in his recent artnet.com interview. For some, Art Basel will help people realize what is going on culturally and artistically. As a service to the community (city), Art Basel allows people to engage developing a broader creative perspective. For local creators, Art Basel is a cultural platform for intriguing participants with their creations.

Third, what possibly is the brand personality of this future-forward Art Basel brand-business? Again, both Mr. Murdoch and Mr. Horowitz suggest that Art Basel will be innovative, creative, bold, exciting, engaging, in touch with a changing world.

Fourth, what are the functional benefits of this future Art Basel? The fair-like, community atmosphere offers individuals a chance to engage with local creators; learn what is happening culturally; be a part of a larger artistic cosmos; participate in cultural events; and purchase art.

And, fifth, what are the supporting attributes of Art Basel: what characteristics would this Art Basel brand-business have that would bring Art Basel to life and provide its credibility? Extrapolating from the press reports and statements, the features of this future Art Basel brand would be galleries selling their artworks some of which are ‘trophy-level”, an immersive experience of varied cultural and artistic events, community involvement and engagement, showcases of local creativity, dining experiences.

In very broad strokes, using this five-bucket format, this future Art Basel will be: For people who desire community engagement and are excited by our changing cultural world; Who seek a broader cultural perspective or who want to share their art to intrigue others; Creative, festive, innovative Art Basel offers people an opportunity to engage with local creators, learn what is happening culturally, participate in events, and purchase art. Art Basel will do this because it offers trophy-level art, varied cultural experiences and community level engagement.

Regardless of the industry or category of a business, brand-business building is applicable and extremely beneficial – and necessary – for enduring profitable growth. But, brand-business building takes discipline. It is not enough to say that you are going to create a brand-business. It is not enough to state a vision. The enterprise must commit to the basic, evergreen principles of brand-business building. Do not pass go until the purpose and promise are clearly articulated. A brand-business must know where it wants to be and what it wants to be in the future world in which it will win.

Ian Schrager Hotel Segmentation

Ian Schrager May Be (Thankfully) Transforming Hotel Segmentation With His Public Brand

The hotel industry uses a segmentation designed by consultancy STR that is all about price, service and amenities. This segmentation uses language that most humans would find bizarre when thinking about their hotel stay. No matter how many consultants provide insight to hotel groups, the default is always price, service and amenities. The STR hotel segmentations basically looks like this: Economy, Mid-Scale, Upper Mid-Scale, Upscale, Upper Upscale and Luxury.

But, now, possibly, as intriguingly described in Bloomberg BusinessWeek, Ian Schrager, entrepreneur, hotelier and co-founder of famed Studio 54, has decided to defy the conventional hotel segmentation approach in describing his vision for his new hotel idea. Mr. Schrager wants to create hotels that are luxury but without the services and amenities. Mr. Schrager wants to create hotels with luxurious experiences that do not depend on multiple on-site staffers and niceties.

In other words, M. Schrager is looking at the hotel from the guest’s standpoint, appealing to their emotional and social rewards associated with experiences rather than the owners’ views as to “… how little can I offer for the room fees I am charging?”

According to Mr. Schrager, the idea for expanding and enhancing his already established lower Manhattan Public hotel is based on his observation that “… luxury has a new and different meaning today. Luxury right now is having freedom – freedom from hassles to make everything easy, freedom of time, freedom to devote your personal tie to the things that matter to you.” Mr. Schrager envisions a chain of these hotels.

This new luxury concept turns the standard STR segmentation on its head. Forget the linear track from Economy to Luxury. In this new world, Economy and Luxury are merged: a luxurious lifestyle feel of bold and cool delivered minimal staff and lack of goodies. Mr. Schrager compares his new Public concept to his legendary (notorious) Studio 54. The aura of luxury is delivered socially – a mixture of celebrities and locals of all ages– rather than by “white glove services that are over two hundred to three hundred years old.” 

The new Public will be a new “genre.” At its core is a “soul of luxury” packaged into a lifestyle hotel configured with less expensive, limited services. How is this such an explosive thought? Here are the standard STR definitions of hotel segments (see STR online definitions):

Economy hotels: Tend to have a mix of mostly K-type (king-size) rooms, offer only a self-serve breakfast and usually lack function space and recreational facilities.

Midscale hotels: Usually have a mix of mostly K-type (king-size) rooms, offer self-serve breakfast only. They may have limited function spaces (if so I typically is about less than 1 seat per key) and offer fitness room and/or swimming pool.

Upper Midscale hotels: Typically have a mix of mostly K-type (king-size) rooms, may offer full service or fast casual model F&B facilities. They offer a function spaces (about less than 2 seats per key), fitness room and may have a pool.

Upscale hotels: Typically have a mix of mostly K-type (king-size) rooms. May offer full service or fast casual model F&B facilities. They offer a function spaces (about less than 3 seats per key), fitness room and swimming pool.

Upper Upscale hotels: Typically have a mix of mostly K-type (king-size) rooms and Club level rooms, they will offer at least 1 full service 3 meal restaurant plus one bar or lounge. They offer a function spaces and business center (a minimum than 3 seats per key), fitness room and swimming pool and they might have a spa.

Luxury hotels: Typically have a mix of mostly K-type (king-size) rooms and Club level rooms. Typically, they have two or more restaurant plus one or two bar/lounges. They offer a function spaces and business center (a minimum than 3 seats per key), fitness room and swimming pool and spa facilities.

As you can see from the definitions of the hotel segments, the merging of Economy and Luxury is antithetical to hotel owners.

Of course, there is a financial benefit to an economy luxury hotel. Margins are better at economy style hotels. Luxury hotels have much more overhead what with staff, bathrobes, slippers, towels, restaurants and spas. Since Mr. Schrager does not franchise his hotels, he is quite conscious of margins, according to Bloomberg BusinessWeek.

But, just imagine the merging of both ends of the hotel segmentation. Imagine a segmentation that includes the guest’s emotional and social desires. Mr. Schrager believes that the first iPhone exuded these same qualities of desire, luxury, simplicity, “design and utility.” When you first opened the iPhone box it was a “wow” moment.

If Mr. Schrage pulls off this new concept in hospitality, and there is no reason to doubt his success, the standard approach to hotel segmentation may forever be altered. No potential guest discusses their hotel stay using language like Upper Upscale or Upper Mid-Scale. The hotel industry would be able to create properties designed to satisfy guests’ functional, emotional and social benefits while reflecting guests’ personal values.

Trust Busting At CNN: CNN’s Public, Acrimonious Internal Volatility May Damage Its Brand

There is turmoil at CNN. What should have been an internal situation is a never-ending series of headlines. Reading about the problems surrounding actions by former CEO Chris Licht due to his “perceived missteps” and his candid commentary in The Atlantic is unfortunate. It brings front and center instability at CNN. CNN employees are distraught that the news channel has become the news.

What is more unfortunate is the damage all of this agita may be doing to the CNN brand. The issues raised are organizational as well as journalistic. Yet, one has the feeling that this mess is messing with the CNN brand. And, that is a problem. For years, CNN has positioned itself as “The Most Trusted Source in News.” The public airing of internal mistrust is extremely harmful to the CNN brand. Employees want to believe that their leaders are trustworthy. When employees lose trust, users, in this case, viewers, may wonder if they should question the trustworthiness of the brand-business. If employees do not trust the brand, viewers may be questioning their trust in the brand.

Putting the internecine issues aside, the CNN brand is in trouble. Diminishing or lack of trust is frightening from a brand-business stand point. The CNN brand stands to lose its credibility. Makes you wonder who is minding the CNN brand? Who is in charge of trustworthy brand leadership at CNN? 

In all of the press, no one has mentioned the CNN brand. The Licht fiasco was based on the idea that the CNN brand should be perceived as “balanced.” That means the reporting should more evenly cover all sides of political conversations. But, as The New York Times points out, the idea of “balance” focused on what CNN should not be rather than what it should be. And, more problematic from a brand standpoint, “balance” remains a vague, undefined concept.

The closest reference we have about the future of the CNN brand is a quote in The New York Times by Warner Bros Discovery CEO, David Zaslav. He said that he is proud to “… have a chance every day to be a purveyor of facts and truth in journalism and to be a place that people can go to have a national conversation about what’s going on in the world.” But, trust? Truth is fact. Trust is feeling. Talking facts is good. But, if you are not rebuilding the trustworthiness of the CNN brand, the CNN brand is in trouble.

Trust is critical. Trust is a precious asset. We live in a world of distrust and mistrust. Trust in institutions has declined precipitously. There is massive distrust of public authorities, declining trust in business and lack of trust in traditional establishments. People prefer to trust themselves, peers or ranking and rating sites for trusted information. People are also willing to use misinformation or “alternative facts” or other sources. We live in an increasingly skeptical, questioning and demanding society. 

Trust is at the heart of every relationship. The literature on trust is vast and complex. Social scientists, market researchers, political analysts, psychiatrists and psychologists, academics and others view trust as an essential element for any type of relationship building. And, because of all of this interest, trust has many definitions.

Trust is a willingness to rely on an exchange partner in whom one has confidence. Trust is a perception of confidence in a partner’s reliability and integrity. Trust is an expectation derived from the ability to perform (expertise), reliability and intentionality. There is research that focuses on the role that trust is increasingly central in building a strong, durable, profitable, growing and enduring brand. Trust is considered to be an important mediating factor on customer behaviors before and after the purchase or use of the brand. Other research indicates that trust causes long-term loyalty strengthening the relationship between two parties, in this instance, the brand and the viewer.

When it comes to brand, trust is the confidence one has in relying on a brand to live up to its promise and its reputation of authority based on leadership, credibility, integrity and responsibility. Trust is the willingness of the consumer to rely on the ability of the brand to perform its stated functions.

Trust is an important driver of enduring, profitable growth.  As trust increases, so does brand value. If there is no trust, there is no brand value. Trust capital is a significant element of organizational wealth, along with financial capital, intellectual capital and human capital. Creating trust capital allows a brand-business to generate a trust reserve that helps the brand-business through crises of brand-business character.  Trust capital is the customer confidence in the authority, credibility, integrity, leadership and responsibility of an organization to deliver promises of value to stakeholders. It remains to be seen if the years of positioning itself as the most trusted source in news has generated a bank of trust capital large enough to see CNN through this turmoil.

A brand is a promise of a relevant, differentiated expected experience. A brand is about an experience the customer will have. Failure to deliver the expected experience forces the customer to reconsider the trustworthiness of the brand. 

The thing about trust is this: it can take years to build, but it can dissipate in an instant. And, once gone or diminished, it can be years before it is rebuilt, if it can be rebuilt. Trust is earned and re-earned over time. Trust is lasting but when it is damaged, the bond can break quickly.  Trust can be lost in an instant. Trust cannot be bought. Trust cannot be claimed. 

It is too soon to know whether CNN’s brand-business trustworthiness has been tarnished by the internal leadership issues and journalistic directional changes. However, there are some basic principles for trust building that CNN might keep in mind.

First, you are what you do.

Trust must be displayed before it can be declared. Customers must consider the brand to worthy of trust before they can commit to trusting the brand. Saying “trust me” does not track with today’s users. Saying we are the most trusted source does not generate trust. This may make the journalists feel good rather than viewers.

Provide iconic tangible evidence that what the brand claims can be trusted. In tough trust situations, it is not enough to say that the brand is changing or the brand is listening. Demonstrate through tangible, credible evidence.

Be predictable. Creating a pattern of predictable behavior is a critical component of trust building 

Second, Lead the debate; Do not hide from it.

In other words, do not stay silent. Staying silent when important issues are at stake is not a signal of leadership. Silence means agreement Trust is too important for silence. Leaders stand up for what they stand for. 

Be specific. Vague, generic statements are harmful. You can drive a truck through “balance.” At the moment, CNN is providing mixed, unclear messages about the brand. It is not clear just how CNN leadership defines balance.

Avoid being defensive. For a brand-business to be taken seriously, a defensive posture implies there is something to hide. When a brand-business is silent or behaving defensively, others can create “truths’ about the brand. Other will recast the brand’s profile. CNN has a brand reputation. The questions will be, who will have the strongest voice in managing that reputation. It is not in a brand-business’ best interest to let outsiders trample on a brand-business’ truths.

CNN has allowed the press to create the scenarios. None of which has been in the best interest of CNN.

Third, Openness is an opportunity 

Truth is not the same as trust. Truth is a fact. Trust is a feeling. To rebuild trust, a brand-business needs both truth and trust. To be worthy of users’ trust, users need to see the truth not just read about it. Without openness, trust is blind.

Of course, openness has its risks. The brand-business must be above board. There are no secrets anymore.

Thinking that turmoil can be enclosed is wishful thinking. CNN opened itself to others’ opportunities. The brand-business is now paying the price.

Fourth, Trusted Messages Must Come From a Trustworthy Source

CNN should own this: it must be a trustworthy source. Trust relies on a relationship of shared values. Trust relies on conversation and interactions. Trust is more than having the right argument. Trust needs the right voice. Peer testimony is more trustworthy than corporate testimony. So, remember the voice of the customer in communications. There had been an aggressive tone to CNN. New leadership was attempting to ameliorate this with “balance.” Reporting indicates that “balance” was supposed to be more of a tonal change than a substantive change. Somehow this did not happen as one observer stated.

Providing trustworthy information is essential. The challenge is to become a trustworthy source of information that is helpful, convenient, understandable, accessible, timely and valuable to users.

Fifth, good citizenship pays.

Being a good citizen is multi-dimensional. But, at its heart, is doing good deeds. Trust does not come from how big the brand is. Trust is a result of how big the brand acts. Sometimes, big brands can act very small. Doing the right thing is the right thing to do.

Customers want to know that a brand’s motivations are authentic. Customers want to know that a brand is using its size and strength to set powerful examples for others to follow. Be a responsible neighbor and a responsible leader.

For all of the turmoil at CNN, the CNN brand must be protected and managed for enduring profitable growth. Right now, the CNN brand is under pressure. If the CNN brand wishes to remain the most trusted source of news, then the CNN brand must act now to retain and rebuild its accrued trustworthiness now.

Taco Bell and Chipotle Know That Relevant Differentiation is Essential 

Several years ago, Restaurant News, an industry trade press, told us that the latest, greatest new trend in restaurants was Mediterranean food. From Italian to Greek, to Turkish to Lebanese food, Mediterranean restaurants were the next big thing on the radar. Not all of these concepts took off. There was a lot of overlap in menu offerings. Falafel anyone?

Recently, Restaurant News focused on taco restaurants, eight up-and-comers. Apparently, tacos have become our anytime food, for everyone food, with tastes and flavors from everywhere foods. These new taco restaurant concepts want to claim a spot in the yet-to-be-solidified space somewhere next to Taco Bell and Chipotle but slightly more upscale, with full bars and service. As one taco restauranteur stated, the Tex-Mex field is wide open.

Do Taco Bell and Chipotle need to worry?

Being aware of competitive entries at any level is strategically smart. But, critically, it is necessary to know the brand’s market focus: the brand’s target audience, the brand’s special benefits and rewards, the brand’s personality, the context (how, when, where) for the brand, the permission to believe the brand claim and its competitive set.

Taco Bell and Chipotle are powerful brands not just because of the food they create and serve, but because each brand knows its brand promise and its market focus. No one expects food from Taco Bell to be crafted on site. But, customers do expect innovative products with out-of-the-box flavors. Chipotle makes its foods on site. There are no freezers. That guacamole or rice that you like is made on premises. Unlike Taco Bell, the Chipotle experience is not focused on delivering seventy different offerings a year. Chipotle focuses on its Food With Integrity promise.

Spend time reading The New Yorker article on Taco Bell and you will understand that no matter what goes on in the innovation center, the brand is front and center. The question is not, “Is this a great, new flavor or design?” The question is always, “Is this a great new Taco Bell flavor or design?”

These eight growing taco brands are described as being flavor bombs. But, exceptional tastes and flavors are features that support the brand’s expected benefits and rewards.

What is troubling about the eight new taco concepts highlighted by Restaurant News is their lack of strategic focus. The articles are all about the flavors and the store designs. But, when it comes to the market focus and the brands’ relevant differentiations, the brands all seem to be alike. 

Relevance is critical for brand health. Relevance is a key driver of purchase intent. Relevance means the brand-business is up-to-date and current in customers’ minds. Relevance means the brand-business is seen to be addressing current customer needs and/or solving customer problems. Relevance, along with differentiation, is necessary for defining brand-business value. Customers ask, “Is the branded experience I receive or expect to receive relevant and differentiated relative to other brands?”

Relevant differentiation means knowing the prime prospect, knowing their problems and needs and the occasions in which they have these needs and problems, and having a well-defined, compelling brand-business promise. The brand promise is the statement defining the expected experience that the brand-business will deliver time and again.

Relevant differentiation has some rules.

First, identify a customer target.

Brands need to have a target customer in mind. Wanting to be a brand-business for everyone is a big thought. But, that strategy can genericize a brand. Even big brands such as McDonald’s identify target audiences. Having a target audience in mind does not mean other customers cannot use your brand. No one is going to stop a customer at the front door because that customer does not fit the target audience description. Focus is clarifying and strategically sound. Also, it is possible to have more than one target audience. McDonald’s has young adults but it also has caregivers with kids.

When a brand says it is for anyone and everyone, that brand tends to be liked by a lot of people but loved by very few. Taco Bell and Chipotle know their target customers. Both brands also know that because of their focus on a specific target audience, the brands will attract like-minded others. Having a tight understanding of the customer is FEDA: a focused enduring differential advantage.

All these new taco brands agree that they want to be something for everyone. As they describe their brands, being something for everyone is more than just having a wide variety of menu items – from traditional proteins to plant proteins – and from tacos to bowls and burritos. Something for everyone also includes pricing. No one should be priced out of the restaurant. So, even with full service and a bar, there are entry level tacos.

Second, identify the relevant differentiated benefits and rewards.

It is easy to think that a brand-business’ features are its benefits. This is incorrect. Features are support for benefits and rewards. To have a clear, compelling brand-business promise, know the functional benefits and emotional and social rewards the brand delivers to users. Tastes are important. This is food, after all. No one wants food that does not taste good or does not excite on some level. But, tastes are the support for why the customer wants to eat at this restaurant and how eating at this restaurant makes customers feel.

For these new taco concepts, the goal is “tastes and flavors” beyond the standards offered by Taco Bell and Chipotle. The flavor profiles are global or specific to a Mexican region not yet explored by other Tex-Mex establishments. The idea is to be either globally inspired or as one restaurant states, Taco Bell on steroids.

In the descriptions of the new taco restaurants, there is no insight as to how tastes and flavors support the benefits and rewards, nor any understanding of exactly what these benefits and rewards are exactly.

Third, have a customer-based view of the marketplace.

Let the customers’ needs, problems and unmet needs create the competitive set. Do these new taco restaurants see each other as the competition? Or do they see Taco Bell and/or Chipotle as the competition. Understanding the brand-business’ customer-perceived perception may surprise.

This is especially important when attempting to define the particular market segment in which you believe your brand-business will win. Based on the comments from the creators of these new taco brands, the market segment is ill-defined. Is this Taco Bell with full service and a bar? Is this Chipotle but more inclusive?  Is this non-traditional tacos?

Fourth, use the Brand Pyramid construct to generate your brand-business promise.

The Brand Pyramid construct is really simple. It has five levels. 

At the bottom level are the brand-business features that provide the credible support for the brand’s claims. These features are essentially the evidence of the truth of the brand’s promise. Taste, price, variety, décor are features.

The second level are the brand-business’ functional benefits. These are the things that the brand does for the customer. For example, because the restaurant offers new and unusual tastes, this taco restaurant opens up my perspective on international foods.

The third level are the brand-business’ emotional and social rewards. These are how the customer feels when the brand delivers its functional benefits. So, when the restaurant helps me to open up my perspective on international foods, I feel less provincial. With my international perspective, I gain status within my group of friends.

Fourth level, Customer values.

What are the values of the target customer in terms of lifestyle, attitudes, beliefs, opinions, interests? Who are these people and what do they hold dear?  To whom am I focusing my brand-business? What do I know about my prime prospect?

Fifth, Brand personality.

What is the personality of the brand-business that differentiates in the mind of the target customers and makes the brand-business so personally appealing? If this brand-business were a person, who would it be?

Generating a brand promise from the Brand Pyramid is a creative challenge but it has the pyramid as its frame of reference. Specifically, use this template: For people with these values… Who seek these rewards… Our brand-business with this personality… Is best at providing these benefits… Because it has these features.

For these growing taco brands to actually win in today’s increasingly competitive and grueling marketplace, there are some key Do Not Do’s.

Do not genericize.

Being generic, offering generic category benefit leads to becoming a commodity product with no relevant differentiation. When you stand for everything and everyone general, you stand for nothing.

Do not maintain a mass market mentality.

Mass marketing is death-wish marketing. Mass marketing leads to genericization.

Do not confuse features with benefits.

Describing the interior design as differentiated is good. But interior design is a feature. As are tastes and flavors. Focus on what benefits and rewards the.se features deliver

As Restaurant News points out, these taco establishments have grown exponentially. Some started as a food truck and now have stores across multiple states. Yet, it is more important than ever to focus on who the brand-business is for, why these people want to use this restaurant and how, when and where they use it. There is a difference between growth, profitable growth and enduring profitable growth. Enduring profitable growth can only happen is the brand-business creates a compelling brand promise and does everything possible to be relevantly differentiated relative to its competitors.

Elizabeth Arden Brand

Elizabeth Arden Stakes Its Future on Its Past Provenance

There have been many pioneers in the cosmetic industry. Just to name a few, Lawrence and Joan Gelb of Clairol made hair coloring something acceptable rather than declassé. Max Factor created pancake makeup becoming the go-to authority for the burgeoning Hollywood film industry. 

And, then, there was Elizabeth Arden who believed women should learn how to apply makeup properly focusing on color coordination of eyes, lips and skin makeup. Ms. Arden also put stock in the ideas of scientific cosmetic formulations as acceptable and, actually, required, for creating and maintain a demure, respectable, decorous image. Ms. Arden underscored the power of cosmetics to provide a youthful, beautiful perception. The epitome of the Elizabeth Arden gestalt was her eponymous Red Door salon.

Over the decades, there has been a wild proliferation of cosmetic and beauty brands. The originals, the pioneers, have taken back seats to new, lab-based, nature-based, organic-based, hipster and elite European and Asian brands.

The Elizabeth Arden brand is fighting back.

Elizabeth Arden is using its provenance in beauty to reignite and reintroduce its brand to younger generations.

According to Glossy, Elizabeth Arden has created a “virtual space based on Elizabeth Arden’s historic Fifth Avenue salon with its iconic red door. It features product information alongside a mini online museum on the history of the brand. The launch makes Elizabeth Arden one of the early beauty adopters of AI-generated imagery. Users will be able to click through “multiple spa ‘rooms’ with products on display that users can click on to receive more information and purchase.”

Ronald Rolleston, global General Manager of Elizabeth Arden told Glossy, “We drill down on the history of the brand, and it manifests itself in the creative. We have this rich legacy, but I would argue there’s a lot of modernity in who we are and what we do, and we’re very focused on science.”

The power of a brand-business’ provenance is significant, especially in an uncertain world.

When times are uncertain, customers seek trusted sources. This drives the need for provenance. A brand-business is more than a trademark; it is a trust mark. A trusted brand -business influences customer consideration and preference while increasing willingness to invest by all stakeholders. It is a hedge against uncertainty. 

Provenance is trustworthy evidence of a brand-business’ authoritative character; the brand-business’ principled foundation of trustworthiness. All relationships rely on trust.

Powerful brand-business relationships gain strength from the brand-business’ heritage. Strong, relevant heritage builds credibility. Strong, relevant history provides customers with authoritative information. This adds credibility to a brand-business’ message. A brand-business provenance is unique in that it can provide continuity and consistency across all platforms. 

The provenance of a brand-business is its consistent, compelling, relevant, distinctive heritage. A focus on a brand-business provenance is not about preserving everything from the brand’s past; it is about preserving the best of the brand’s past for the present and future. Provenance is uniquely past, present, and future. A brand-business provenance emphasizes a past of authority, a present of user connection and a pathway towards a future of enduring, profitable growth. 

This is what Elizabeth Arden is counting on with its new provenance-enhancing virtual store.

The virtual store is basically “… a virtual museum” featuring “images depicting the 120-year history of the brand and its founder, including her support of the suffragettes and the introduction of the “Victory Red” lipstick during WWII.”

Elizabeth Arden hopes the new virtual store with its focus on using the past for present and future success will connect with younger customers.

For those who think that provenance is only important to antique dealers, museums and auction houses, think again. Brand-business provenance is essential for building a strong foundation for building trust capital, leading to high quality revenue growth.

Brand-business provenance influences customer-perceived value. Customer-perceived value contributes to increased brand-business preference. This in turn generates trust capital, leading to high quality revenue growth. 

A brand-business is more than an identity. A brand-business is also a culture and the culture’s values. A brand-business is a seal of “permission to believe.” Provenance provides “permission” because it reflects and articulates a heritage of credibility, integrity and authority.

A powerful, credible provenance is competitive advantage; a leverage against competitive actions. Provenance signals truth. Provenance provides a common connection across all stakeholder relationships. And, this is a foundation for enduring brand success.

Elizabeth Arden’s Red Door may have opened in 1931. But, its values and core brand elements are just as relevant today as these were over 90 years ago. This continued relevancy is on display in the virtual Red Door salon.