Color Folders In The Mind is a quick and light soft-bound pocket trade book for marketers and non-marketers; entrepreneurs and business owners of conglomerates and mega-businesses, academicians; trade and commerce people, even economists; business students and advertising people or just about anybody interested in setting up a business.

The book is a quick tool kit that helps the reader understand how to build, keep, and sustain a brand in the target market’s consciousness over a sustained period of time, long before the buying transaction happens and always whenever the category comes into mind.

Color Folders In The Mind introduces a practical, metaphorical guide that keeps the reader abreast of his brand’s performance in the Customer’s mind. The self-accomplished checklist helps the business owner and his Marketer track his brand’s performance at all times.

Color Folders In The Mind is based on the concept that each Customer keeps a mental file folder of the Brand. Each marketer and business owner must strive to fill the Consumer’s mental file folder of the brand with deep knowledge of the brand, meaningful consumer experience, new product excitement over time, among others. The colors orange, black, grey and white  are representative of the brand’s performance in the mind of the Customers and the Marketer.

Moreover, the book provides the reader a peek into different types of consumers with insights dredged from research. Among these markets include the active silver citizen market, the modern man, male homemakers, indulgent women consumers, GLBT (gay, lesbian, bi-sexual and transgender) market, affluent households, the tween market, VS (voluntary simplicity) and ethical consumers.

For example, the book takes you through how older people in general think about their age. Unless extremely tired or depressed, older people do not think of themselves as old. Advertising that talk about the silver citizen’s active lifestyle rather than about his age is preferred. The book shares product successes and failures like how Heinz pureed senior food miserably failed as the elderly shied away from the product perceived to symbolize old age weakness and helplessness.

Another is the emergent GLBT market and how these can be reached. The book shares how humor appeals to this segment and how strong a sense of family they have. It also stresses how this market can no longer be ignored. That is why major companies, many of them belonging to Fortune’s 500 like Procter and Gamble, American Express, etc. are aiming their guns at this market. Even the local chain of National Bookstores has a gay and lesbian fiction section to address the needs of this market.

Advance readers of the book have offered the following testimonial blurbs:

“COLOR FOLDERS IN THE MIND:  A BRANDING STORY can help propel your brand to be top of mind among consumers. It emphasizes how great strategy and execution of your brand plan come hand in hand. Let us help you take this wonderful journey and make your brand a Heritage Brand.”
Socorro “Nanay Coring” Ramos
Founder
National Bookstore

“With much insight and practical knowledge, Dr. Karen de Asis presents a highly useful guide for marketers of all kinds.  Light and easy to read, this book, Color Folders in the Mind, gives valuable information on helping every brand fulfill its ultimate goal of having an orange marker. We had the opportunity to learn first hand from Dr. de Asis’ vast marketing experience.  She has been instrumental in helping our company successfully launch and sustain many of our brands.  More power to you!”
Dr. Abraham F. Pascual, Ph.d.
Chairman of the Board
Pascual Laboratories Inc.

“Entrepreneurs’ marketing skills are honed and cultivated over years of challenging traditional thinking, questioning status quo and constantly exploring marketing ideas that dare to probe cracks in established and seemingly totally impenetrable markets.

Unfortunately, entrepreneurs have a collective Achilles heel; the common weakness is our inability to accept and concede that our gut feel marketing, life skills armory and conceptual instincts do have limitations. Fortunately our infallible sixth sense can be further reinforced and validated by marketing disciplines that Karen De Asis espouses with passion. These invaluable marketing tools such as FGDs, market research together with a structured disciplined approach, positively contribute in converting and harnessing the entrepreneur’s earth-shaking ideas into a well-managed campaign and a bankable long-term marketing plan.”
Albert M G Garcia
President & CEO
Whealth Inc.

“COLOR FOLDERS IN THE MIND  is rich with marketing wisdom, and provides a clear roadmap for every one who wants to build a successful brand.  It brings to light the elements that help global brands remain successful, and illustrates how local brands adopt brilliant marketing strategies to transform themselves into world class brands.

It is a very practical guide to building brand differentiation, and identifying high value market segment opportunities.  It is a must read for every marketer who wants to create a meaningful and enduring brand.”
Marie B. Lee
Group Account Director
Ad and Brand Performance Division
TNS North America

“COLOR FOLDERS IN THE MIND is a brilliant and valuable marketing tool. A must-have to execute a Brand plan. This book guarantees success for every Marketer. An enjoyable reading experience!”
Mylene Abiva-Sazon
Vice-President, Book Development Association of the Philippines (BDAP)

View the Chapter One Sample Pages here! | Order here!

GIVEN THE HEIGHTENED COMPETITION in today’s global business environment, business owners know that they need to go into branding if they want to enter into licensing and franchising deals and win consumer loyalty.

And yet, few actively engage in the business strategy that requires sustained investments in resources, funding, time and people.

And if they do go into branding, many usually do it the wrong way. They forge ahead minus advice from brand, research, creative and media experts who have the right analytical and decision-making tools at their disposal.

Not branding

Branding is an expertise and not a commodity service. That expertise can only come from years of strategic experience and practice, acquired knowledge and exposure in the same and related field of discipline as well as the added value of access to networks and partners built through time who can help bring in efficiency, speed and sustainability in managing brands. Branding require deep-thinking and a well-thought out strategy that gets validated or provokes new ideas and concepts in research and is eventually translated or executed in creative campaigns, media, special events and other formats that consumers see or experience. It is never the other way around.

Among the many sins of attempting to brand without strategic expertise include:

• Dealing with creative agencies or free-lance creative talents without a firm brand strategy validated by research and minus the consumer insights that creative agencies use to craft executions that compel consumers to buy products and services;
• Working with creative and media partners inept in handling and executing customer insights into sustainable creative campaigns;
• Relying on the creative and media output to provide the strategic framework and not the other way around;
• Merely copying what competitors are doing in terms of messaging, creative and media implementation;
• Clinching media contracts without proper assessment of the strategic fit between the brand and the media partner; basing decisions largely on general rating and ranking and demographic data not knowing that a psychographic and target-market specific data can change or modify the media plan largely. Further, media investments are triggered by close relationships and promo deals rather than strategic media decisions resulting in non-sustainable, one-time only media deals;
• Believing that name mentions can adequately build the brand;
• Absence of an expert brand strategist on the team. Often, the role of the brand expert is viewed as a commodity and one that a business owner can assume.

How to brand strategically

Having identified the many sins of branding without strategy, following are the ways by which to achieve branding grounded on strategy:

• Engage in insight mining research activities that intend to understand consumers deeply;
• Work with creative partners with ability to capture consumer insights into the brand’s communications campaign;
• Collaborate with media agencies that objectively present options based on a recent-dated media data;
• Bring in temporarily, an objective, third-party experienced brand strategist to work with Board Level to set sustainable brand directions;
• Engage the board level and business owners in strategic work and impress upon them the importance of a sustained involvement.

The writer is the Strategic Brand Management Course Program Director at the Asian Institute of Management and is the author of the best selling branding book, Color Folders In The Mind: A Branding Story, available at Powerbooks, Bestseller and National Bookstore outlets.

Many believe that when one does marketing, one is actively engaged in branding too. While both marketing and branding must be done complementarily, this is not always the case.

Most businesses often practice marketing by identifying target markets, sourcing new customers and keeping old ones.

Yet, they fail to do branding.

In sourcing new customers and markets, some businesses invest and use various forms of marketing communications but drop this altogether when one’s comfort level has been achieved, riding instead on word of mouth and loyalty of new customers to sustain the business. Thus, products and services never rise to the level of becoming a true brand or revert back to become once more a commodity product or service reliant on the efforts of sales people, customer traffic derived from a location or an occasional spurt in sales driven by discounting.

This is where branding differs from marketing. Not all products or services become brands. True, each commodity has a name. All must influence consumption to sustain the business. But marketing a commodity is a short-term business strategy while building brands is strategic and long-term. Commodities have a shorter life span while brands live long enough to last through many generations when managed properly.

Beyond identifying customers and catering to their needs, brands go beyond the functional nature of commodity products and services and become iconic symbols for customers who believe they cannot live without their favorite brand.

What makes a brand?

Contrary to commodity products and services, brands enjoy attributes that the former do not have. These attributes, also identified by brand thought leader, Kevin Lane Keller in his book on Strategic Brand Management include the following:

Brand awareness. True brands, while probably not having reached a cult level nevertheless, do enjoy pervasive familiarity among its target market. Most consumers should be able to name, recall or recognize the brand upon mention of the category.

Brand loyalty. A real brand nearly has a cult following. Often, consumers see their favorite brands representing themselves. If a brand were a person, it is not uncommon for loyal consumers to see the brand as their kin, soul mate, confidante or friend.

Perceived quality. Brands provide a psychological reassurance that at all times one can obtain a better and consistent quality. The assurance goes beyond the functional nature of the product or service.

Brands have strong, differentiated and positive associations. Anything that comes to mind or is stored in memory about a brand is called an association. But brands, as opposed to commodities, have only positive associations uniquely identified to them and are strongly recalled and recognized by its potential target market and users.

Brands have patents and trademarks. Any business with a brand must be highly protective of the brand. Patents, trademarks, creative copyrights, etc. become proprietary assets of the brand. This is because when managed properly, a brand’s life can be sustained for many generations despite changes in the business environment. A commodity’s life on the other hand is relatively short and its continued existence is highly dependent on the business and competitive environment and marked by volatility.

Only an impartial consumer research can validate whether one is a brand or not. No hearsay or feedback from friends, relatives and acquaintances during community or small group gatherings can replace research.

From a commodity to a brand, how to migrate?

Strong desire to brand is the right mindset. Key to branding is the right mindset. Commodity products have a small user market. However, if a business owner has reached his level of comfort financially, most do not wish to take the next level believing that they have saturated the market or are simply fearful of more tedious work and challenges ahead. Others fail to see far greater opportunities. Still some abhor the dynamic pace behind brand building and management preferring a relaxed way of managing the business.

In 1975, Jollibee Foods could have remained an ice cream parlor serving regular comfort food like Jollibee’s yumburger, chicken joy and Jollibee spaghetti. But Jollibee had the foresight, guts and right mindset to brand against a global foreign quick service restaurant brand, McDonalds and become more than just an ice cream parlor business. After thirty years, Jollibee has more than 650 outlets in the country and a reported Philippine revenue of 32.4B in 2008, excluding foreign sales revenue and income generated from other businesses funded by capital from Jollibee Foods Corporation.

Two years after its incorporation in 1978, Jollibee launched its first TV commercial in an attempt to build the brand but it was not till five years later in 1985 when brand building became far more successful with a differentiating story via the Langhap sarap campaign that embodies how Filipinos uniquely judge good tasting food through aromatic smell i.e. sa amoy pa lang, masarap na. Until today, this remains to be Jollibee’s significant trademark. From then on and with sustained brand building, Jollibee ceased to be a commodity.

Year	No. of Jollibee stores (Philippines only)
1975	2
2008	651

Branding guarantees quality. What makes branding beneficial to consumers is its guarantee of quality. A company that moves from marketing a commodity to a brand practically cannot compromise the quality of its products and services. Integrated in managing brands is the reputation of the makers of the branded products and services.

Unilab began as a small drugstore in 1945 and a few years later evolved into a pharmaceutical company with a quest to provide quality medicines at an affordable price. To date, Unilab boasts of being the largest Filipino-owned pharmaceutical firm with the most number of over the counter health products and brands of medicines that have bridged the annual billion-peso sales turnover. Among its most popular brands of over the counter products built through massive advertising and consumer awareness campaigns include Alaxan, Neozep, Medicol, Ceelin, Myra E, and Decolgen, to name a few.

Consistency in building brand awareness and fostering brand loyalty. Nike has transcended itself from being a commodity athletic footwear with a proprietary technology to an iconic brand since it was marketed thirty years ago in 1978. Nike’s brand story, consistently sustained through three decades is grounded on the insight that every person aspires to become a winner and simply wearing a Nike moves them to feel like one, motivating them to ‘just do it’, a selling line that captures the winner attitude. Even Nike’s in the Greek language is associated with the Greek goddess of victory.

In 1978, Nike boldly came out with its first brand advertising via print through its former agency, John Brown and Partners. The ad visually featured a lone runner on a rural road and had a powerful headline ‘There is no finish line’.

Nike’s strength lies in strategically, and not whimsically, selecting endorsers picked fresh in their careers i.e. Michael Jordan, Andre Agassi, Roger Federer, John McEnroe, Serena Williams, Kobe Bryant, Lebron James, Tiger Woods, Rafael Nadal, etc and very recently team endorsements like Manchester United and FC Barcelona, among others.

No wonder, Nike, unlike other commodity athletic footwear, committed a yearly 20% annual shareholder return in the last five years.

Branding is not a short-term, deal-making, highly executiional business tactic. It is strategic, long-term in nature and can be successfully mounted only by a focused, determined and visionary business owner. For branding is a long term way of doing business that has to begin from the top and passed on from one generation to the next.

SUCCESSFUL BUSINESSES WORLDWIDE has come to realize the importance of branding.

Branding is the key to sustain the growth and life of a commodity product or service from one generation to the next. At its functional level, branding results in differentiating a commodity from another.

The IMD World Competitiveness Report, a bible reference for many global businesses states that brand management is a key area of world competitiveness in its roadmap report for the period covering 2007 to 2050.

Despite the reported advantage of branding, few businesses engage in building brands preferring to allocate resources to diversified commodity products and services, believing that every product and service has a timeline anyway. Others hide behind the all-time reason that brand development and management is too costly to invest in one product or service.

Why not branding?

There are a host of reasons why owners of businesses fail to do branding. Among them include:

Comfort level has been achieved. While founders of businesses theoretically know the advantages of branding, many of these businessmen at the present time have likely achieved their comfort level of material satisfaction and see no reason why they need to aim for further growth of the business or more revenues. Often, at this stage, the business has become a cash cow and a source for sustaining the owner’s present-day interests and activities.

Loss of passion and aspiration. Building a brand is like starting and growing a business. In both instances, the owner’s passion is a key that keeps the founder’s spirits high in times of challenges. Building and managing brands is a constant test of wit and spiritedness of the brand owner as the latter protects the brand from all possible sources of brand erosion i.e. poor and inconsistent customer service; inefficient and wasteful brand awareness programs; customer attrition; weakening brand positioning due to inability to respond to changes in the environment; brand imagery that destroys rather than builds the brand over time; mounting costs of advertising with poor sales recovery, etc.

Here and now versus here, now and future mindset. Traumatized, overwhelmed or worn-out by building and managing a commodity business in his time, most owners of businesses find it difficult to think of managing the business with the intent of strongly fortifying it for the next generation. Often, the founder realizes that raising the commodity to the next level to become a brand is much like giving birth to a new business and will require extensive time, effort and resources. Not many have the will and energy to go through the motion.

Chronological age a hindrance, so one thinks. Without a founder’s inherent personal passion and a strong belief that branding is the best business strategy to protect a product or service from competition and a negative economy; chronological age becomes the convenient excuse not to build a brand. Col. Harland Sanders, founder of Kentucky Fried Chicken, now known as KFC, grew his business through franchising and brand building at age 65 years old. A founder’s age is never a deterrent when a brand owner is resolute in his vision and mission.

Work-horse versus a leisurely lifestyle. Brand building is no easy and quick job. A successful brand is the result of the brand owners’ foresight and diligence at work particularly in overseeing the correct operational execution; a grounded understanding of the business environment; and an insightful understanding of the brand’s potential and existing customers. Building and managing a brand cannot be done at leisure or when one feels like doing it. Thus, not all business owners who are in the milking stage are accepting of a probable rigorous work demand resulting from brand building efforts.

Builder versus steward mindset. Most second and third generation business owners are laggards in managing their businesses, mindful of losing or eroding what their forefathers or fathers before them has built. Thus, they take the easy route of merely following what has long been the tradition despite the need to implement changes that respond to the changing business environment. Seemingly, most are unaware that doing nothing is almost like razing the business to the ground, not realizing that the value of a business without a reputation, which only a brand can bring, is not likely to live up to the next generation. Often, stewards pray that the business can be passed to the next generation, leaving the successors to decide whether they should grow, keep or even sell the business.

Active versus passive income. When a business is at the cash cow stage, relatively adequate revenues come in with negligible marketing and branding efforts. It is at this stage when the temptation not to invest resources into the business is at its highest. Many rely on passive income from the cash cow business for their indulgences and allocate any excess to obtain incremental passive income from stocks, mutual and hedge funds, etc. rather than bringing it back to the business by building brands.

Too much emotional baggage to carry. Stewards of businesses have much emotional baggage to carry – rising up to the founders’ vision, fear of losing it all one’s generation, breaking the mindset from managing to growing the business substantively and restructuring one’s comfort level.

When branding happens

Developing commodity products and services to become brands is not only the handiwork of functional managers but the result of an owner’s vision. Without the support, passion and vision of the brand owner, no successful branding can ever happen. Following are some of the insights that drive business stewards to become builders of brand.

CEO Steward changes heart. The CEO steward begins to personally dream big, taking what was passed on to the next level – from a commodity to a cult brand. The result is growth and expansion versus erosion. When a CEO steward begins to aim for ten times or more of what the present business generates, then the stage has been set for the CEO’s change of heart.

Faith in one’s product and service. Many commodity products and services have been in existence for quite some time but have not reached the level of awareness adequate to be identified as a brand. Even then, their status as a commodity product or service has sufficiently obtained sustained revenues for the business owner. If such were the case, then taking the commodity into the next level signals success specially when branding is done correctly.

Strongly believe that branding is a sustained key business strategy for continuous growth. The key to successful branding is to sustain it. Successful branding cannot happen with one-time wonder branding efforts. Once the momentum is set, brand owners must be careful not losing it. Building a brand is difficult; sustaining it is much easier but brand owners lose it at this stage when the urge to milk the brand happens.

As the world economy is likely to contract and advanced economies, from whom developing and emergent markets rely heavily, project less than a half percent growth, it is not surprising if the world’s highly industrialized nations protect their own.

Like the rest, the world’s wealthiest nations are affected by lesser foreign direct investments, decreasing options for stand by credits and development funds, decelerating demand for commodities and services and plunging foreign remittances.

Protectionism comes in many forms like raising trade tariffs and other barriers to free trade, subsidies and financial assistance to highly inefficient local companies and domestic industries, legislations that substantively provides tax incentives for locally produced goods and services, excessive dumping, among them.

While leaders of the G20 member countries pledged to fight anti-global trade policies in their last meeting in 2008, the first quarter report of the World Trade Organization (WTO) was no consolation when it released its findings in March 2009 that 17 of the G20 members have failed to keep their promise.

The G20, first established in 1999, is made up of finance ministers and central bank governors of 19 countries, whose aim is to provide a forum and open dialogue between industrialized and developing economies to discuss key issues that affect global trade. The G20 membership include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, United Kingdom, United States of America and the European Union. Also participating in the G20 economic dialogue is the Managing Director of the International Monetary Fund (IMF) and the President of the World Bank.

Like Damocles sword, protectionism hangs

In a move to prop domestic economy, Argentina has imposed tariffs on a variety of goods including shoes, appliances, machinery, processed food, steel, iron and textile. Paraguay, Ecuador and the United States, will implement a Buy National campaign providing a substantive competitive margin and preference for domestic goods and services over imports. The more populous countries that advanced nations salivate for like Indonesia is likely to support restricted entry, India an outright ban and China with more stringent standards.

The degree of protectionism depends on the speed, depth and length of time that a recession is likely to stay. So far indications of a recovery are not yet in sight as world industrial production continue to fall at a 20 percent annual rate; unemployment figures rise, now estimated to be 50 million worldwide, due to global recession; and global demand for commodity products and services are reduced.

Why is there a need to brand

Branding cuts across trade barriers worldwide. Many of the world’s most successful businesses have been fueled by single or multiple company owned brands, most of which have cut across geographical barriers. In many instances, customers’ needs are universal and when a single brand comes to be identified with being responsive to a particular need, the chances for this brand to be accepted across several markets is high. Zara is among the world’s most valuable and youngest brand of retail apparel originating from Spain and now with a brand value of $5.95. Zara’s unique proposition is its ability to bring stylish and trendy apparel from design to retail at quick speed, most often in less than a month in contrast to the average industry rate of six months.

Top 15 World’s Most Valuable Brands 2008

Source: Interbrand 2008

Brands are measured by its own unique value proposition and not by the originating country. Brands, protected by trademarks and patents, are identified as legal assets of business owners, and go beyond the country of origin. Thus, when trade barriers are set, they are immune from the same fate that commodity products and services suffer. Business owners with brands have the option to partner with stakeholders in other global markets who share the same passion for building and sustaining the brand in their home country.

In the last decade, more and more valuable brands have emerged from Asia in categories that are highly competitive worldwide. These include car manufacturing, appliances and technology.

World’s Most Valuable Brands 2008 From Asia

Source: Interbrand 2008

Branding domestic products reduces the entry and proliferation of dumped foreign brands, products and commodities in developing countries. Developing nations are favorite dumping grounds for excessively manufactured foreign brands and commodities, also fueled by a prevailing colonial mentality among a massive customer segment. The right branding for domestic products and services guarantees a perception of quality that is parity or superior to foreign brands thus, creating fair if not more difficult competition for dumped foreign brands.

Brands provide for better trade, gross and net margins over commodity products and services that make it more appealing for trade partners worldwide. When commodity products and services are traded in open markets, trade buyers perceive that everything is generic and there is no one differentiation from one supplier to another. Thus, it becomes illogical for one supplier to acquire a better margin than the others. Commodity trade buyers take advantage and resort to pushing down prices at the lowest possible rate, never mind if fair trade is compromised. Not so, with branded goods and services where trade buyers are largely careful in the manner they carry the negotiations.

Brands bring pride of ownership on the negotiating table and a level of national patriotism for its owners. Provided business owners carry the same trade name, trademark and legal patents worldwide; knowingly, there is that innate feeling that one has done one’s country proud by contributing a Filipino-owned, designed, manufactured and marketed brand into the global free trade market.

Published in Philippine Daily Inquirer, Business Features Section, April 3, 2009

THE FAMILY IS NOT JUST THE basic political unit, it has also become the nucleus of corporations large and small.

In fact, quite a number of today’s global companies and brands are either owned or controlled by families.

In the United States and the United Kingdom, nearly 80% of businesses are family owned or family controlled. The same profile exists in the Philippines and much of Asia.

Among these are Microsoft, Toyota, Apple, Nike, Ikea, L’Oreal, Zara, Adidas, Starbucks, Hyundai, Marriott, Samsung.

Source: Interbrand 2008

So does the Philippines have its own family brands

The Philippines has its share of family owned and controlled business, now into their second and third generation management, originally fuelled by single brands and eventually, multiple brands.

Among them include the ubiquitous SM, Universal Robina Corporation (Jack n Jill snackfoods, Great Taste Coffee), Lamoiyan Corporation (Happee toothpaste), Jollibee Foods Corporation, United Laboratories (Ceelin, Neozep, Alaxan, Enervon, Medicol, Biogesic), Suyen Corporation (Bench), Liwayway Marketing Corporation (Oishi snack foods), Pascual Laboratories Inc. (PotenCee, Betadine), Max’s Restaurant (Max fried chicken), Goldilocks Bakeshop (Goldilocks cakes and pastries), etc. On the other hand, there have been and continue to be quite a number of family owned and controlled businesses that have relinquished their core brands as these companies enter into their second, third or fourth generation of management.

What makes family owned businesses become local or global brands

The Owners’ vision and fortitude inspire business-building activities that cut above the rest. Founders of businesses with local and global brands are visionaries, intent to differentiate their products and services from the rest. In so doing, they engage in business building marketing and branding activities. Rather than milk the business, it is not uncommon for these visionaries to plough back net earnings on marketing and branding efforts that should strengthen the brand. Samsung is the world’s largest conglomerate that includes Samsung Electronics, the world’s largest electronics company. Founded in 1938 in Daegu, South Korea by Lee Byung Chul, the Samsung brand has become a leader in many domestic industries that include electronics, engineering and chemical industries. From 1998, Samsung strived hard to become a global brand spending more than $6B on global branding activities finally edging Sony in 2005 from its long-held position. Samsung has been run by generations of one of the world’s wealthiest families pushing the brand to its optimal growth and performance by the founder’s second son, Lee Kun-hee.

Founder and successors view business success beyond the present. How one views success in business is relative to one’s comfort level. Not too many technologically superior products and services rise to become a brand thus, foregoing dominating the industry or category when it comes to market share. This is because the founder may have experienced his comfort level, so with the second and third generation not realizing that building a brand out of a relatively successful business is really helping sustain the brand beyond one’s present generation.

Succeeding generations share a passion for the founder’s vision. Myth or not, most family businesses subscribe to the belief that the fruits of most businesses are quickly dissipated by the fourth generation, believed to be the most spendthrift among generations. Not so, if the founder’s vision has been institutionalized in the Company family brand and his generational heirs. Interestingly, many successors have fortified their family businesses and brands to become global players.

While many globally successful businesses with multiple brands are into the second and third generation, some families have owned their businesses for the last two hundred years. Thirty-eight of these businesses belong to the Les Henokiens, an elite club of family businesses beyond two hundred years. Among these businesses include fifteen Italian companies, ten are French, one is Dutch, four are German, one is Belgian, two are Swiss, four are Japanese and one is from North Ireland.

Owners recognize that Brands are like legal assets that can be passed on from one generation to the next. More than liquid and tangible assets, brands guarantee a revenue stream for succeeding generations provided business-building and branding efforts are sustained meaningfully from one generation of consumers to the next. Brands are intangible assets that provide a never-ending potential for sustained earnings all depending on the level, width and depth that succeeding generations aim to grow and expand. The growth of any business and its brands ultimately depends on how far the vision of any generation’s appointed caretaker will take the brand.

Successful generational family businesses sustain the life of their brands recognizing that commodity products and services can not extend the life of their companies. Family companies are catapulted to success and wealth often by single or a few products that trigger substantial company revenues. Business building does not end here. The founders start the major process of building trust, positive associations and reputation around the names of their lucky products and services resulting in a branding effort that establishes a deep connection into future generations of consumers. Not surprising, consumers into the third or fourth generation continue to use the brands originally and long patronized by their grandparents and/or parents.

A family member is tasked to grow and expand the business in every generation. While family businesses recognize the valuable assistance of professional managers, owners of family businesses realize too, that accountability for firing up the business and its brands ultimately rest on the generation’s appointed caretaker and anointed leader who happens to be a family member. Like it or not, the passion, pride and emotional engagement for a family business by a family member who begins to understand his birthright and accountability is far, far different from a professional manager.

Family businesses with strong multiple local and/or global brands, not commodity products or services, know that it can survive any government shakeup, recession or protectionist markets. Successful family owned or controlled businesses well into their third or fourth generation survive because they have not dramatically shifted their focus from core brands that have catapulted them to success in the first place. While these companies may have extended into other businesses and categories, the original parent brand remains a priority in the day to day business building and brand activities of its generations of family members.

Family members of businesses must recognize birthright and fortify the company and its brands.

Call it luck, fate or destiny, but being born to a family with a successful businesses disassociates a future generation family member from the tremendous hardship, lengthened work hours and pain resulting from the peaks and volleys of a new, fledgling business. Thus, to some heirs, loss of passion and inspiration is common.

Ironically, companies with single or multiple brands that have been in existence for more than a decade and yet have not mounted a well-organized branding effort are more likely to be the companies that should have the resources to mount a branding campaign. And if the branding effort happens to be very successful, it is logical to expect a new set of loyalty from present and future generation consumers thus guaranteeing the life of the brand in the coming generation.

As recession deepens in advanced economies, and various economic agencies agree that Philippine growth will slow down in 2009 from 4.6% in 2008, local business owners remain calculated in their actions while reservedly optimistic.

In the recent annual World Economic Forum held in Davos, Switzerland, an issue that faced the G20 advanced economies including US, Germany, Italy, France, Spain, Japan, United Kingdom, Canada, among others, was the likelihood of an emerging trade and financial protectionism. While world leaders agree that global free trade is vital to keep the world economy going, they also recognize a strong accountability to local constituents. Hence, the challenge remains to keep the domestic economy afloat while supporting world trade. This includes being careful with trade policies and regulations that strongly favor foreigners over domestic trade and constituents. As it is, the export sector in many country markets has become severely affected. Likewise, with the potential scarcity of capital, domestic projects are likely to be logically prioritized.

In the end, far from being a severe threat, the world recession can actually be an opportunity for local, aggressive and visionary companies.

Here are some ways to ride the tide of opportunities presented by a global downturn and a local economic slowdown:

Strengthen your brand locally. Now is the time to build your brand and ascertain a space in the consumers mind. Brands who have worked at owning the consumers mind during prosperous times while remaining unstoppable in an economic crisis are likely to become stronger brands after the crisis. However, not all is lost with brands that have not invested in brand building during good times. So long as these brands have sustained a critical mass of loyal consumers they are likely to ride through the opportunity presented by a recession by expanding their awareness levels among a bigger market.

Send the right economic message with local brands. An economic downturn provides a reason for consumers to explore using local brands. Local brands that are able to signal value for money and quality while tapping the right market and appealing to the right consumer motivation can become a serious option for consumers. Categories that are likely winners include branded generic drugs (over global branded medicines); branded local food, beverage and confectionary items (over imported options); branded local fashion (over more expensive global fashion brands); reputable local brands over local commodity products, among others.

Grab that retail presence when global brands ease their retail space requirements. With endless cash and marketing budgets in prosperous times, global brands practically owned the shelf and retail space, leaving nothing of prime spaces to local brands. As world brands begin to prioritize their markets due to rising scarcity of capital funds and consumers tighten their hold over disposable money, local brands must take the place of empty spaces left by global brands.

Fortify your company’s star brands and build your question mark brands after careful assessment of your product assortment. Star brands grow more than the market projection but question mark brands may be hidden champions, not fully nurtured, often disregarded but yet, more than satisfactorily growing. Now is not the time to invest in new product development and introduction since consumer optimism to spend is far less robust. However, creating winners out of mildly familiar brands with a critical mass of loyal consumers may be a more practical and sustainable business strategy in downtimes.

Spend your marketing communications budgets wisely and efficiently. Put in place a feedback system that will allow you to measure the success of your brand building effort. Companies can gauge the effectiveness of media spending by the amount of extra media values that agencies get for clients or the friendly rate per spot or insert that is much lower than the rate card. Nonetheless, the true measure of a successful campaign is the incremental business the campaign has brought, visibly evidenced for products and services beyond the introductory stage. Likewise, the rise in awareness levels and brand equity scores that determine what it is about your brand that compels consumers to buy or shift from a competitor.

Building a brand is no longer the turf of money-muscled global brands. Today, there are far more ways and means to build local brands with far lower budgets and more efficient ways. Of course, not in the same level when global brands are often introduced in a country market. Nonetheless, local brands stand a better chance today than their counterpart many decades ago. Business owners simply have to determine whether they want their brand building efforts fast-tracked with great impact in present time or slower and more measurable but sustained over a longer period of time.

Recession or not, brand building is an important piece of creating demand and building robust revenues. For products to remain in business for a long time and passed on from one generation to the next, it is imperative for business owners to invest in brand building in much the same way as they make investments in infrastructure; plant facilities, equipment and machineries; people resource; product development and research. Having a good product is only one side of the coin but having your target market know that the product or service exists is likewise, a most important other half. What good is it to have a good product or service, if potential consumers are not aware of the product or service.

The global retail industry forecast is not exactly rosy with a projected deepening recession in advanced economies and an economic slowdown in Developing Asia.

Value, value, value over retail location

When money is tight, consumers start assessing their options. A 2008 Global Nielsen Report conducted in 47 markets including the Philippines reveals how majority of global consumers rate “good value for money” as the primary consideration in buying goods and services followed by a better selection of high quality brands and products. Location placed third.

This implies that brands, products and services are more likely to drive the purchase, with consumers having made up their minds, possibly even before choosing the store location they will make the purchase.

Source: Grocery, Store Choice and Value for Money: A Global Nielsen Report 2008

Surprisingly Filipino shoppers, despite their natural penchant for shopping and private consumption, remain the most avid value seekers. Ninety percent of Filipino shoppers are influenced by their perception of a store’s reputation for good value for money, same with over 80% of Singaporeans, Indonesians, Greeks, Malaysians and Taiwanese.

Source:Grocery, Store Choice and Value for Money: A Global Nielsen Report 2008

What is even more interesting, is how four in ten global consumers including Filipinos take matters in their hands by researching and assessing brands and retailer prices with Turks (84%) leading the roster followed by Filipinos (79%), Brazilians and Poles (78%),Portuguese and Thais (77%).

The pressure is on for retailers and retail landlords

While an accessible location remains important for retail, this has nearly become a commodity with more store formats and stores rising to serve even the smallest population segment. Thus, when consumers think about spending their money particularly in times of economic crisis, they are likely to think about brands, products and services over location. Here are some ways by which retailers and retail landlords can overcome the impending economic slowdown:

Retail landlords must support brands that seriously make an effort to talk to consumers. Gone are the days when products and services rely on their presence in store shelves or leased spaces in malls to attract customers. In times of crisis, retail landlords must collaborate with brands that seriously invest in brand building to forge consumers share of mind and share of space. Brands help bring foot traffic to a retail space with retail presence easily resulting in a sale that mutually benefits the brand owner and retail landlord. Same with independent retailers; retail landlords must choose tenants who are capable of attracting their own foot traffic into their store and consequently, to other mall services and tenants.

Create a perception of value for money in retail. A primary driver for buying is “good value for money”. Thus, retailers and retail landlords must make it conveniently noticeable for shoppers to spot perceived value for money brands when these consumers enter stores or malls. Often, brands with substantial investments in brand building are the same brands with a high incidence of perceived value.

Have a strong portfolio of good value for money brands. Filipino shoppers are certified value seekers. This means that for a store or mall to thrive, it must have a substantial portfolio of good value for money brands. Good value for money and economic brands are not the same. Economic brands rely on selling cheap at all times compromising quality most of the time. Good value for money brands may not be the lowest priced. When it comes to good value for money brands, the satisfaction and benefit of usage a consumer thinks he is getting far outweighs the cost of purchasing the brand.

Invest in brand building. An economic crisis is an opportunity to build a strong brand. Most brand owners become naturally cautious in downtimes. This leaves the field open for more assertive players who believe that even in an economic crisis, brand building must be sustained. The good news is – despite an economic meltdown, it is still far cheaper to build a brand during economic downtimes when there are far less aggressive competitors and more businesses hungry for sales revenues.

Published January 9, 2009, Philippine Daily Inquirer

So far, the Philippine economy has remained relatively resilient in 2008 from the massive, rapidly descending free-fall of the global economy. GDP growth is estimated to have slowed down to 4.4% in 2008 versus a robust performance of 7.2% in 2007. Despite this and pocket behaviors of a slowing economy i.e. returning OFWs from affected advanced economy countries; dips in the automaker, manufacturing and export sectors, etc., there is more than enough bright news sustaining the performance of certain industries, companies and brands in 2008.

The International Monetary Fund (IMF) projects a 3.0 world GDP growth in its ‘World Economic Outlook October 2008 Financial Stress, Dowturns and Recoveries’ report. Much of the positive contribution will come from Asia with newly industrialized Asian countries contributing 3.2% and 7.7% for Developing Asia where the Asean 5 including the Philippines, China and India belong.

In 2009, more bailout packages will shore up advanced economies. While still presently inadequate, these economies are being infused with running amounts at $3.35 trillion by the United States and $3.36 trillion from the nine leading European countries.

All these indications point to the fact that no one advanced economy to the best of its capability will lend itself to a downhill battle which is welcome global news. So is this same attitude and mindset prevailing in the minds of local businesses and entrepreneurs? Not likely. Locally, most businesses are followers, over-calculated in their ways, highly risk-averse and less-opportunity seekers.

What’s in store for 2009

A new year marks new hope. Filipino consumer confidence and optimism is generally high when it comes to welcoming a new year. Not so for local businessmen anxiously expecting the falling of the axe in 2009.

Most ask, which industries and categories are likely to meet growth in 2009? Here are the lucky nine sectors likely to be resilient.

1. Brands in various categories, who are presently, top one or two in their markets and enjoying high awareness levels with no indications of slowing down in 2009. Recessions come and go, in various generations and times. It is how one responds to the economic crisis that makes one successful.

Marketing cases document how a number of brands have profited during recession. Philip Morris gained market share during the 1970s downturn by maintaining advertising and marketing spend while its competitors watched and waited. Nike in the 1990s tripled its marketing spend resulting in profits nine times higher during recession.

2. Local companies and brands in various categories with a differentiating, relevant brand story to tell and guts to overcome fear of investing in a forecasted doomsday economic scenario.

Regional and global brands are likely to prioritize their present strong markets over new, developing markets. This presents an opportunity for a challenger or follower brand in a market dominated by a global brand.

Then again, Asia might just become the favorite destination for global brands having a better economic forecast than elsewhere in the world. Still, local brands with fervor and passion must work to maintain, if not grow what they do have.

3. Brands with an economic story so long as they are told in a relevant way and with an adequate share of voice to reach potential target markets. Do it yourself (DIY) retail shops and economic substitutes in categories like food and beverage, healthcare, retail fashion, etc. are likely to be resilient.

4. Home entertainment versus out of home. Even in times of crisis, people have a natural tendency to want to feel good and indulge oneself once in a while. Modeling and duplicating fun experiences in-home, once enjoyed out of home in prosperous times, isn’t all too bad particularly when one is able to control and restrict expenses more effectively. Likely to benefit are convenience, instant meals; food deliveries; home entertainment and gaming; home furnishings, house wares and repairs, etc.

5. Personal care, toiletries and beauty products and services including spa, skin, body and hair care, etc. Filipinos, in good and bad times, are keen about their physical appearance. This must be because, Filipinos are generally proud. Despite economic adversity and skipped meals, if it can be helped one is not about to drastically reduce consumption in this area.

6. Health is wealth as most people know and have experienced. Even in economic adversity, if it can be managed, consumers will continue to support healthcare brands that they trust. Particularly in economic crisis, people value their health as this guarantees them sustained livelihood. Despite possible dips, the healthcare category particularly those that have built their brand’s image, in various categories that include preventive and therapeutic healthcare, nutraceutical and medical services shall remain relatively resilient.

7. Education is the source of sustainable development and for many centuries has been proven to help many individuals and nations rise out of poverty. Demand for education services will continue to rise as many seek to improve their skill. This windfall is likely to be enjoyed largely by educational institutions and experts who have become trusted brands.

8. Travel, lodging and travel-related services will remain heads above water. While business travel will be restricted substantially, with businesses opting to maximize communication technology and shift downward to economy travel, lodging and services; the demand for leisure remains, provided it is sustained with far more creativity e.g. new and exciting closer to home foreign and local destinations; shift from high-margin to low-margin but high value business strategy for travel agencies for both local and overseas leisure travel, etc.

9. Indulgent and luxury brands with authentic, socially responsible causes. Even the wealthy have become suddenly conscious about inconspicuous spending as much of the world is expected to go into recession. Nonetheless, pleasurable shopping is given a new twist by helping sustain authentic causes with every purchase e.g. saving the environment, alleviating poverty, providing sustainable livelihood, etc.

Contraction expected in downtimes

It is expected that a global recession the size of the 1930s depression will spare no one nation. In a recession this size, markets are expected to contract and the period of downturn will not be short. There will be winners and losers. But triumph will come to those who work hard to sustain demand in efficient ways during trying times; while loss and failure is but expected to come to the weak at heart, slackers and laggards who awaits the time when the economy will once again experience robust health and they can enjoy the crumbs falling from the table. Hopefully, this group prays that economic recovery comes quick before the ills of waiting eats up what little they have toiled and earned during robust times.

Does your brand have what it takes to face an economic slowdown?

2009 is likely not going to be an easy year for many businesses as changes in the macro-environment foretell. Based on the recent World Economic Outlook 2008 report of the International Monetary Fund (IMF), advanced economies led by the US, Germany, France, Italy, Spain, Japan, United Kingdom, Canada is projected to grow to a combined half a percentage point (0.5%) only while the total world’s GDP at a very modest 3.0. Developing Asia including China, India and the ASEAN 5, where the Philippines belong, shall by far contribute to this modest growth at 7.7 and 4.9, respectively. Newly industrialized economies, while markedly hit, is still projected to grow at a modest rate of 3.2%.

The Philippines compared to its neighboring members in Developing Asia has the slowest economic growth rate at 3.5% nonetheless, the projection is still fairly positive.

Overview of World Economic Growth Outlook Projections

Source: World Economic Outlook October 2008 Financial Stress, Dowturns and Recoveries, International Monetary Fund.

While the weak-hearted businessman will take to this news with grim prospects and predictably in an overly pessimistic and downtrodden way, the visionary businesses and brands will view the data with far greater optimism and hope.

Asia faces an economic slowdown, but there is positive growth

Asia, compared to other regions is in a much better financial position and capability to face the backlash of an economic crisis emanating from advanced economies. This, the advanced economies and investors realize that is why there is an expected entry and transfer of more investments into Asia than any other place. Thus, Asia suffers a mere slowdown and not a deep recession that is already happening in advanced economies.

On the other hand, because Asia seems to be the last man standing in an economically crushed time, since the 1930s depression, chances are domestic businesses and brands can expect a far more competitive environment brought about by the entry of foreign and global brands. Here lies the challenge: the preparedness of any domestic brand for this kind of competitive landscape.

Check out your brand’s health before its too late. Do you have what it takes to prepare for a far stiffer competitive environment in 2009? Following are some five ways to help build a resilient brand.

Check your brand’s awareness levels. Your brand may be in existence for the last twenty, thirty or even sixty years. So far, you may be happy with the net income that your present business brings to your table. After all, it allows for a sustained more than a comfortable lifestyle. But if the brand has so far reached thirty years with extremely modest marketing efforts, then maybe its potential is not even full-bloom. Time to find out objectively through market research whether your brand truly enjoys the awareness levels you think it does.

Have a brand story to tell. It makes a big difference if your target market remembers you in a more significant, substantive way. This way, you are assured that you are likely to belong among your potential consumer’s selection criteria when a product, service or even a personality category comes to mind. But stories to tell are difficult to craft thus, rely on an expert brand strategist to help you in your brand building effort. Remember that use of celebrities, creative materials, special events, merchandising, media mix et. al. are mere executions of your story to tell.

Check out your media mix. Let your brand objective direct your action when it comes to choosing your media mix, not the other way around. Are you after creating an expanded awareness level to generate more market or are you happy talking to the same set of customer base and increasing their substantive awareness of your brand through high affinity, low rating broadcast programs or special events? Are you happier having more people know more about your brand in one exposure or content having a handful of people know your brand in one event relying on word of mouth advertising? Herein lies the relevance of time and opportunity. Whoever is first in the mind of your potential market in a relevant way, is also likely to enjoy consumer action. Pray that the next aggressive local, foreign or global brand is not out to take your story.

Have a good channel presence. Availability is key but relying solely in your presence in major channels is not going to make your product or service move. Being available is an important complement in the marketing mix when it comes to building a brand. But believing that your brand will sell simply by flooding the market by being present in all major channels will not. Open your eyes and look around you, you are likely to have the same direct and indirect competitors using the same channel. So what will make your consumers prefer your brand over another who has a story to tell and whose awareness level among consumers is far greater than yours.

Refresh your brand. Find ways to continuously sustain your target market’s interest in your brand. Check out your product and service stock. Be more proactive in learning about the interests of your consumers.

Even when the macro-environment was not exactly robust, many big brands today were born and thrived during economic downturns. The key is to make your brand resilient even during downtimes.