All posts by Michiel Maandag

Michiel is the founder of Monday Brand. He is an inspirational speaker, who loves to make the complex fun and simple. He specialises in positioning brands and creating clarity in portfolio and architecture.

Volvo Corporation attacks electric with the Polestar brand

The car category is already for some time in turmoil because of the change to electric. On top of that, in the conventional car category the Volvo brand is struggling because of changes in positioning. The owner of Volvo Corporation, Geely Holding has determined that Polestar will be the brand to compete in electric. Is it the right move?

The change to electric genuine for car owners and drivers as they need to change the way they think about driving and “refueling” cars. Consumers experience, therefore, electric cars as a different category. There are conventional cars, and then there are electric cars – both require a different way to interact with driving and moving you from A to B.

When something so impactful happens in any category, we will likely experience a change of brands. There will be brands that only focus on the “new” electric category. There will be existing brands trying to extend from conventional to the electric category. When a category changes so profound, some of the car brands of today will need to make space for the electric car brands of tomorrow.

The impact to the current brand owners has everything to do with whether the existing car brands can compete with electric cars – at least on a level to be on par with the perceived leader in the category. In other words, if you are in the market for an electric luxury SUV, then it is easy to go for the Tesla Model X because the perception is that it is the best in electric and in-car technology. The Mercedes-Benz EQC would come close, but it needs to deliver more to change the perception of Mercedes-Benz and that of the perceived leader Tesla.

Volvo is executing two different strategies to conquer the electric car category. First, the company is moving the brand Volvo from a conventional to an electric car brand. At the same time, Volvo Corporation is following a conquer strategy with their new brand Polestar. Polestar is a standalone brand to focuses on electric cars.

The Polestar brand is not new to Volvo. It used the brand in the past for Performance upgrades of their vehicles. The real Volvo enthusiasts will know the brand with the desired perception of performance, technical advancements, etc. Unless you are a Volvo enthusiast, the Polestar brand will be new. As a bonus, the Polestar name has a nice Nordic / Scandinavian ring to it. Volvo bought Polestar in 2015. In 2017 Volvo Cars and their owner Geely Holding announced that Polestar would become a standalone to focus on electric cars.

Applying the earlier discussed Flip-test would indicate that Geely Holding made the right call to bet on two horses.

When we apply the Flip-test:

Current: Volvo gasoline cars
Extension: Volvo electric cars

Flip it!

Current: Tesla electric cars
Extension: Tesla gasoline cars

Does it make sense? Perhaps not so much. Geely Holding does the right thing to compete in electric with the new brand Polestar while not giving up on Volvo. It would be a shame if the Volvo brand will not make the transition to electric in the minds of buyers. The success of making the transition will depend on the number of cars at different price points from new electric car brands.

Personally I am very happy to see Volvo to take action. The brand has been in turmoil for years. I have written about Volvo in the  Volvo Positioning series Part 1Part 2Part 3  and a Reflection why successful companies change their positioning.

Credibility is lost when you do not live up to what you stand for

When you repeatedly go against your mission and values, you lose credibility, and your position is in danger. The audience will start to drift – first, slowly towards other platforms. Drifting will accelerate once a critical mass through worth of mouth is reached. Then there is no way back. 

Brands are like people.

If you for example do not like how a friend behaves, you can simply decide to no longer hang out with your friend. The same goes for brands. If a brand behaves terribly, you can decide to stop engaging, buying, or using that particular brand.

It gets tricky when your friend says that living according to noble values is essential and even points the noble way of living out to others. It comes then as an unpleasant surprise when you learn that your friend is everything but living up those dearly hold and communicated values. We get confused because the friend’s behavior does not match the perception we have about the person. The person is no longer credible.  If the friendship continues, it will be an unhealthy one based on disbelief and issues with trust. If a brand stops living the values, the same reaction of disbelief and distrust appears. And over time, we will look for alternatives.

Today I encountered a trust issue with YouTube, the brand that has brought video sharing to the masses. YouTube helped to accelerate the growth of humans by bringing immense knowledge to the fingertips of everyone.

Already for some time, YouTube is actively censoring freedom of speech by removing videos or channels about medical information, science, scientists, specific news channels, or simply videos containing an opinion (how scientific it might be) that is going against a set of guidelines, therefore stopping the debate and opportunity for humans to learn.

Earlier this morning, I decided to take a look at the About YouTube page (link, archive ) to understand what the company is all about and the brand credibility with me.

The first thing you encounter on the about page is a clear mission statement. Unfortunately, YouTube is actually actively going against their own mission. For YouTube not everyone is the same, some deserve to  have a voice, while others unfortunately do not.

When we look at the values we see a similar pattern.

The Freedom of Expression is striking:

We believe people should be able to speak freely, share opinions, foster open dialogue, and that creative freedom leads to new voices, formats and possibilities.

If YouTube in the last year has shown one thing it is that it is not a real advocate of Freedom of Expression.

I have therefore one simple question for YouTube:

—-
Dear YouTube,

You have given me a lot of opportunities to enrich my knowledge on virtually any topic. I thank you for that.

Unfortunately, I am distrusting you and as your friend I see two options going forward:

  1. You live up to your values,
  2. You update the values to reflect your behaviour.

Either way is acceptable because strong brands provide clarity regarding what they stand for and consistency in execution using company values as a steering compass. Only this way, they remain credible.

Make your choice.

—-

Photo by Adam Fejes from Pexels

Reddit Nailed It

Jep… Reddit nailed it with the first-ever JPG(!) SuperBowl Commercial

The actual message – that one slider – was nicely wrapped in a short reel controlling placement and impact. The total commercial was 5 seconds only. 

Reddit did a great job, and with only 5 seconds of airtime, the commercial generated a maximum impact. Those interested in learning what the message actually said had to go online to find out, and once online, the step to visit the Reddit platform to learn what it is all about is easy.  

In essence, Reddit tells us that “powerful things happen when people rally around something they really care about”. The old Nokia slogan “Connecting People” is still alive and well. This time, according to Reddit, the platform to connect is their online platform.  

The 5 second commercial:

The key message (JPG):

General Motors transitions to EV the Nokia way

GM makes the strategic error of announcing a full transition to EV without having the portfolio of cars to back it up. 

 

General Motors started the year with a big splash…. a new logo and a new company direction (link)!

General Motors invites ‘Everybody In’ – underlying the change to electric vehicles using their new Ultium platform.

This is the new home page:

And yes, you are reading that right:
We’re making Electric Vehicles for all.

Never mind that the current product portfolio has one electric car!

The stats across the GM brands:

  • Chevrolet: 1 EV  out of  16 car models
  • Buick: 0 EV out of 5 car models
  • GMC: 0 EV out of 12 car models

This reminded me immediately to a company very dear to my heart: Nokia.

Back in 2011 (the 11th of February, a day I never will forget)  the Nokia CEO Stephen Elop announced transition from the  ‘smartphone OS’ Symbian to Windows Phone 7. All of this was done without a single Nokia Windows Phone ready to hit the market.

 

The fallout was massive… the Symbian sales went down the drain, and in fact the brand Nokia went down the drain.

What -on paper- appeared an ‘easy transition’ turned out to be not that easy. The company had an enormous knowledge of the ‘old technologies’ and very little of Windows Phone, it was a transition that was not easy, and it turned out to be very unsuccessful.

The reason for the failure was not alone the internal Nokia execution. The other part was  consumer perception. Whether Nokia employees liked it or not, Nokia as a brand was not Apple or Android.

Fast-forward to 2021 and GM… we see exactly the same happening:  introduction of a new strategy to ditch conventional car engines without having a line up ready to  underscore the strategic direction to consumers.

The result: consumers will pretty much stop buying GM conventional engine cars until the cheaper EV models are available. During this time GM will need to transition… at rapid speed. Similar to Nokia, GM is full of conventional engine experts and none of that is relevant anymore.  That is A LOT to bridge… especially in an economic downturn time.

On top of that GM is still not Tesla or any another EV car brand…

The only real benefit GM has at this point, is the fact that there are not yet any real affordable EV players in the market that consumers can buy right now.

GM: I am afraid you made a strategic error by pleasing shareholders (short term benefit) while ignoring the product portfolio and consumer perception (GM does, unfortunately, not equal EV). Announcing a transition without cars will result in stagnation in sales of conventional engine cars.

Snickers Shake! Do the Flip test

I found this Snicker Shake image on my phone. I took this photo back in 2017 to keep it as a memory of yet one more failed line-extension.

It is quite amazing to see big brands falling for the line-extension trap. In The Only Book You Will Ever Need on Branding, we introduced a simple tool to check whether a brand extension makes sense. We called it the Flip Test.

If your brand and category are Snickers candy bars, and you want to see whether consumers could make the stretch and buy Snickers Shakes, then… flip it! Take an established brand in shakes, like Ripple, and extend it to your category of candy bars.

Then ask yourself… does this make sense? NO! So, in this case, the brand Snickers should not extend into Shakes.

One more…

Current: Red Bull energy drink
Extension: Red Bull Cola

Flip it!

Current: Pepsi cola drink
Extension: Pepsi energy drink

Does this make sense? No.
So Red Bull should not have extended into cola drinks.

Flip before you stretch your brand!

Strong brands do not need discounts

The impact of discounting products on the short and long term. 

The Black Friday & Cyber Monday sales are almost over. Consumers who got some deals are happy, and so are businesses. 

For companies, sales discounts are a great way to boost short term sales. It is an approach with guaranteed success. If you want to increase the sales bonus, then start offering discounts! When your product is in demand, you will notice that even people who do not need it right away might buy it because of the deal. 

Like with everything, there is a flip-side to the discount deals craziness – I like to call them deal traps, and here they are:

Postponed purchases of higher value items in general

If your product is NOT a fast-moving consumer product but a substantial investment for consumers, you must consider any possible discount you are providing. Imagine if I am in the market for an expensive bed, I could easily wait till Black Friday to purchase if it saves me 30% of the new price. Believe it or not… people are willing to wait till the next round of discounts. And at the same time, they do know the room to negotiate.   

Artificial purchase cycles, esp with higher value items 

A great example of this discounting is FujiFilm. In Spring, Summer, and Winter, they run pretty steep discounts on cameras and lenses. Now how often do people buy cameras and lenses? If you are in the Fuji camp, you should make your purchase three times per year! And what happens when a camera or lens is you like to purchase is not on sale? Then wait -if you can- till the next seasonal offers. Changes are your dream kit will show up at some point. 

Suggested retail prices do no longer exist.

Discounts reduce the suggested retail sales prices of the products in the mind of the consumer. Once you have seen a printer in a special offer for 69EUR, you won’t pay that 99EUR suggested retail ever again. Perception is why strong brands never engage in discounts – because discounts perceptually make the brand and product positioning weaker. 

Apple only recently engages in discounts, but they are never direct discounts – always in Apple Gift cards, to be used in the Apple Stores. You pay the full price and get rewarded with Gift cards. This way, the value perception of the product in the mind of the buyer won’t change.

So, what is the alternative to consider?

Never discount your core product but provide perks around it. For example, if your business is, let’s say, Music composition software, then never create a deal on the software. Instead, provide perks and packages of items people get when they buy the software. For example: buy the software get a plugin for six months for free. 

Whatever you do, keep in mind that strong brands never do discounts and never need to do discounts. 

 

Apple Redefining the PC industry

The Apple The Future of Mac event was a big bold move as Apple transitions away from Intel processors to in-house developed silicon. The move is in fact a redefinition of the PC industry business from ‘processor speed’ to a pure choice in form factor.  Yet another industry will get a rude awaking. 

One to rule them all

The reason for Apple silicon is obvious: when you own the full stack from silicon to the user interface you are in control of the total experience while reducing interdependencies.

There is however one drawback to this approach and that became painfully obvious during the presentation of the new Macs: Apple has just one chip which is not advertised in speed.

Consumers have learned that processor speed and the type of processor determines the processing power of a computer. Secondly, by using different processors manufacturers are able to differentiate between their line-up.

An entry laptop will not have a 3.0Ghz 6 core processor with a turbo boost for example. The fact that it was technically not possible (battery and heat-wise) helped to differentiate in various product-lines built around the processor.

 

No more differentiation around the processor

With the introduction of M1, Apple uses the same silicon in their-line up. It was clear from the launch events that Apple struggled with the differentiation between the products.

Just take a look at the Apple Mac Compare page for the new M1 products: Macbook Air, Macbook Pro and Mini and you will notice it is all the same

There are some small differences, like Touch Bar, Wide Stereo Sound, nits brightness, expansion ports… but nothing more.

Even on the individual product pages, the same M1 information is presented:

 

The future is form 

Going forward the difference will be in the form, additional gimmicks, but not speed. In fact, just like with the iPhone product platform the difference will be the form factor: iPhone 12 Mini, iPhone 12, iPhone 12 Pro, iPhone 12 Pro Max

This change in dealing with a computer portfolio is probably the biggest change we have seen.

Taking this approach makes it easy for Apple to create product update cycles based on the M processors, which could go like this:

2020
Macbook Air M1
Macbook Pro M1
Mac Mini M1

2021
Macbook Air M2
Macbook Pro M2
Mac Mini M2
iMac M2

With heath and power consumption for the first time not being an issue anymore in the computing industry line-ups can be dramatically simplified.

During the launch event, the positioning between the Macbook Air and Macbook Pro was far from clear.  Both are exactly the same, except for some small features like ports, touch bar etc – so why would Apple keep in them in the long run? The answer: for the form factor, think screen sizes and future platform enhancements made possible by the total control of everything from processor to UI.

 

Redefining the PC industry

With the move to form factor based differentiation Apple is redefining the PC industry. The same portfolio simplicity that works with the iPhone, iPad, and Watch has now finally entered the desktop and laptop market.  The PC manufacturers with Intel will be in for a rude awakening.

 

Be careful when leaving the brand core – case Fujifilm

Fujifilm – a personal brand favorite of mine –  recently launched a new product line of cameras seen as Sony copy cats. Is that a good or a bad thing? While I realize not all of my readers are digital camera photography enthusiasts, the lessons in this article are applicable to any industry.

In his brilliant book Innovating Out of Crisis: How Fujifilm Survived (and Thrived) As Its Core Business Was Vanishing, Shigetaka Komori, the CEO who brought Fujifilm back from the brink explains how he engineered the transformative organizational innovation and product diversification of Fujifilm. It really is an amazing story.

The key principle during this process of organizational engineering was that Fujifilm remained true to its roots.  The mission of Fujifilm remained that of Preserving and Sustaining the Culture of Photography.

This result of this mission can be found in the design of the Digital Imaging products of Fujifilm. Fujifilm understood there are a couple of ingredients to a valuable imaging brand: lens, sensor, processor *and* connecting to the heritage of photography.

In the case of Fujifilm, this translated itself to the creation of cameras with a  distinct vintage look, with the same dials and buttons and the original Fujifilm. And very important, simulations of original Fujifilm analog films are built-in the camera.

Fujifilm. X100V, a vintage looking camera

 

The result: a huge fanbase of Fujifilm camera enthusiasts combined with a distinct positioning. Fujifilm Is the only “film” brand that made -without any doubt- the transition to digital! 

So far… so good!

But something happens to every focused brand: the need to expand or extend. In the case of Fujifilm, they decided to copycat their biggest competitor: Sony.

And with it, Fujifilm launches a new “S” product line, the first product being the S10. Gone is the retro look, gone are the dedicated buttons, gone is that vintage photography feeling Fuji brand advocates love so much.

Fujifilm X-S10 – the Sony copy, no more vintage

 

The Fujifilm site “Fujirumors” calls it exactly what it is The Vintage Departure.  And that is not a good thing.

Of course, Fujifilm will attract some new buyers, but while doing so it loses in being the distinct photography brand. In other words, all the carefully build up brand equity will get a hit.

And, perhaps easy to forget, but if buyers would have wanted a Sony, they would have purchased a Sony to start with. Nobody likes to have the copy, it gives the impression you would not be able to get the real thing.

The same would be for Sony. If Sony would make cameras looking like Fujifilm it might attract of course some people, but those who really go for the Fuji look, feel and operations will come to Fujifilm.

Think about it, do you rather drink Coca-Cola or a “supermarket own brand” version? Do you rather drive a Tesla or the Mercedes-Benz electric car?

My prediction is that the new Fujifilm S line will be one of short term gain and a long term pain. The better move would have been to invest in new and innovative ways to stick to the core and preserve, sustain, and expand the culture of photography.

 

Spotify, claim your leadership position now

The Spotify app for music streaming launched already back in 2008. For the majority of consumers, Spotify is still synonymous with Music Steaming.

The growth of Spotify in terms of subscribers is very impressive and in line with the uptake of 3G/4G data contracts and interest in ‘music as a service’ in general.
– 2011: 2M paying
– 2012: 15M free, 5M paying
– 2013: 18M free, 6M paying
– 2015: 55M free, 25M paying
– 2020: 133M paying

When looking at Google Trends data it is clear that very little people search for the product category “streaming music or streaming songs”. Instead, people search directly for the brand Spotify.

The insight:  the brand Spotify in the minds of consumers truly equals the category. What a wonderful position to be in!

Of course, the world changes, and like in every successful category competition comes in.  Besides Spotify, we now see players like Apple Music, TIDAL, Amazon Music, Youtube Music and Pandora (US only).

 

And while the fight is massive, with huge lock-in advantages for Apple and Amazon we still see that Spotify is leading the category (source: MidiaResearch)

  • Spotify: 36%
  • Apple Music: 18%
  • Amazon: 13%
  • TIDAL: not disclosed – part of  “the other” category at 11%

The market research results are in line with what we see in Google Search volume:  the clear leader is Spotify .

With all the new and very powerful competition, the overall marketing of “streaming music” grows and more and more people get interested.

The question is: who benefits? is it the perceived leader or the company doing all the marketing? It turns out, so far Spotify is benefitting. A Reuters technology news item from 2016 proved the point “Spotify says growth has quickened since Apple Music’s launch”.

There are two reasons for this:
1) Spotify remains to have the pioneering advantage – consumers know more about it and other services have not yet proven itself completely.

2) Consumers simply think “if Apple/ Youtube/ Amazon are active in streaming then (the leader) Spotify must be really good” and they default the purchase to the category leader. Consumers showed similar behavior during the famous Pepsi vs Coca-Cola challenge, also here the leader benefited.

 

Fast Forward to 2020…. 

Today we see many new streaming consumers, all people who do not know anything about the early days of streaming and might not have a perceived leader at all – they just go for what is most convenient “because they are all roughly the same anyway”

And looking at the brands in the App Store it seems they just don’t want to differentiate – at all!

Below are the descriptions in the App Store – try to find the differences or reasons to download one app over the other…

Spotify: Music and Podcasts
Discover the latest songs

Apple Music
60 million songs. All ad-free

TIDAL Music
Hifi Songs , Playlists & Video

Amazon Music: Listen Ad-Free
Stream & Download New Songs

YouTube Music
Stream Songs and play videos

 

Below is my attempt to position each app stronger by focussing on their strengths – helping consumers to navigate and make a choice.

Spotify: Music and Podcasts
The #1  streaming music app

Apple Music
The worlds biggest ad-free library

TIDAL Music
High fidelity sound, hi-def video

Amazon Music: Listen Ad-Free
Stream for free with Prime

YouTube Music
The #1 in music videos

 

In order for Spotify to keep their leadership position in the years to come, they will need to claim the position and live up to it – externally and internally.

Only then consumers who are in the market to spend money on streaming will be able to choose the leader because after all,  it is only the leaders who have followers.

 

Discover Your ‘Zen ‘Personal Brand Consistency’ Score

I know, you must be thinking… “A Zen Score… what has that to do with branding ?”

A lot actually!
More on that soon.

First, during this forced Corona stay at home time, you must have noticed the importance of working and living in an environment that encourages your mental and physical well-being as well. It really is more important than ever before!

To help you understand the impact of your home to your well-being the amazing team at EMRAYS developed the free ZenX app.

You simply scan any room in your home to instantly discover your Zen score to help you improve your life at home! The app will report back the level of order and calmness, the way your room affects you, and the mix of furniture styles.

And the app tells a lot about your brand as well!  Does the score reflect your personality and hence your personal brand? Is there a match or mismatch?

If you feel there is a mismatch then now is the time to work on your desired identity versus your image!

I invite you to have some fun with ZenX – it is currently available for iPhone 6 and higher as part of the Apple Testflight program.

Find out more on ZenXApp.com or get going right away and download ZenX here.

Stay healthy!