10 Breakaway brands
These companies - from eBay to Geico - cut down on hype and connected with customers, says Fortune's Ellen McGirt.
(Fortune Magazine) -- Man, it's been a tough week. My house burned down and my dog ran off. But I've got some good news: I just saved a bunch of money on my car insurance. (Rimshot.) If you got that joke, then you're one of the millions of people who have enjoyed - or at least remembered-one-liners from ads run by the auto insurer Geico.
Sure, Geico hopes you'll recall its value proposition (that it's a low-cost provider of an essential product). But its clever ads-from a talking gecko to offended cavemen to Little Richard acting out a customer testimonial-also use humor to reinforce its image as a friendly ally of drivers and insurance shoppers everywhere. And that is brand magic.
Ideas about achieving brand strength, that elusive alchemy of awareness and trust, have changed in the past decade. "It's no longer, What can we blast out there about ourselves?" says Michelle Roehm, associate professor of marketing at Wake Forest University. "Brand theory now asks, How can we connect with the community in a really meaningful way?"
It's a big question. Armed with information about price and quality, today's consumer is formidable. But, says Roehm, "if you're willing to talk directly and deeply to your audience, you can become a strong brand without a lot of fanfare."
This is the second year Fortune has asked Landor Associates, a brand and design consultant in San Francisco owned by WPP Group's (Charts) Young & Rubicam division, to share the results of its Breakaway Brands Survey.
Landor, working with New York consultancy BrandEconomics, tapped Young & Rubicam's BrandAsset Valuator, a database of responses from 9,000 consumers evaluating 2,500 brands measured across 56 metrics. Landor looks at distinct elements such as differentiation (what makes a brand stand out), relevance (how the consumer feels it meets his needs), esteem (how well regarded it is), and knowledge (how much the consumer knows about it). There's more at stake than just image.
BrandEconomics calculates the financial contribution that brand heft contributes to the market value of each firm, considering such factors as sales, profitability, and leverage in the marketplace. As the table below shows, it's not chump change.
There are some important nuances. The survey measures growth over a three-year period, not simple awareness. So Coca-Cola (Charts), a high-profile brand but not a growing one, isn't on the list. Media companies that have their own distribution channel or create their own content have an unfair perception advantage and are screened out. (Google, (Charts) which made the list last year, has been reclassified as a media biz and thus was dinged.) And since the panel consists of adults 18 or older, the youth-centric sensation MySpace doesn't show up on the list. (Yet.) The remaining brands-about 2,000-are then ranked. About half the companies on the list experienced a negative move. Most that rose did so by only a fraction. So a rise of six points at a company the size of eBay (Charts) is huge.
Three unmistakable themes bubbled up from this year's survey, and most of the breakaway companies are standouts in at least two of them. "Today it's all about trust, community, and creating a dialogue with your customer that shares real knowledge," says Hayes Roth, chief marketing officer for Landor.
Consider Robitussin, once a mom's trusted potion of choice for sick kids everywhere. Its growth stems from a fairly dramatic package redesign in 2005 that added a symptom checklist on each box to signal which formula was right for which cold-related maladies. "It's very different from how medicine has been traditionally sold, using doctor portrayals on television," says Roehm. "They spoke directly to the consumer."
Among brands that foster community, the iPod is an obvious winner by virtue of its ability to create an online music ecosystem virtually overnight. "But one of the little-mentioned elements of the iPod's success has been the experience provided for the customer at the Apple stores," says Ross Rubin, director of industry analysis at NPD Group. Set free from packaging and locked cases, iPod stuff is always available for experimentation and play.
Other brands are more surprising. Viking, the Mississippi manufacturer of upscale kitchen appliances, has transformed itself into a lifestyle brand by opening 14 cooking schools. Most students are Gen Xers, younger than Viking's typical moneyed customer. It's a chance to play with the product, yes, but the classes also reinforce the simple pleasures of sharing meals with loved ones.
Perhaps no name on the list has attempted a deeper conversation with its customers than Dove. Its reliable but stodgy brand hit an emotional nerve-and pay dirt-with the "Campaign for real beauty," launched in September 2004. Using research on what real women thought about current images of beauty -they were frustrated by them - Dove positioned itself as a champion of female self-esteem. It shared its research publicly and used real women (curves, wrinkles, and all) as models.
A 2006 Super Bowl commercial showing how narrow images of beauty can be damaging to girls was a surprise hit. So were sales. "We went from single-digit growth to double-digit growth," says Philippe Harousseau, Dove's U.S. marketing director.
Geico ad fans may have noticed a less revolutionary change in the popular gecko. The mildly skittish, British-accented voice was replaced with that of a real, grittier-sounding Londoner. His face now looks more human too. "We wanted him to seem cooler, like a guy you'd want to grab a pint with," laughs Steve Bassett, a creative director at the Martin Agency, which has had the Geico account for over 13 years. We're good with it, just as long as the lizard's not driving.