Tag Archives: Differentiate

Brand Promise, Brand Strategy, Perception, Portfolio

Netflix buys DVD.com, what’s next in the branding saga?

Netflix, once known as one of the most successful dot-com startups is going through a rough time with some serious branding mistakes. Today I read on engadget.com that Netflix bought DVD.com… why would they do that?

Seven years ago the world looked great for Netflix. In 2005 it was shipping 1 Million DVDs per day to its subscribers. Wow! Netflix had an amazing position: it simply was #1 in the DVD rental. Netflix was nicely riding on the DVD player sales. There was one problem though… the DVD player was eventually going to be replaced by digital distribution.

The Netflix folks saw that coming and in 2007 they introduced streaming under the same Netflix brand. The service became successful but times changed and in Q3 2011 Netflix lost 800.000 subscribers.

The Netflix folks saw that one coming too and decided that the strong brand Netflix should live on in the streaming business, making place for a new brand called Qwikster for the DVD rental business. A couple of months later the idea was buried.

Or… was it? Netflix has now bought DVD.com. I am sure one of the ideas of the folks at Netflix is to use that for the rental business, moving Netflix over to the streaming business forever.

Now… what is going on here? Is this really the smartest move? No it is not!

Firstly, Netflix should have retained the Netflix brand for the DVD rental business only. The brand was the number one in the category. Even though the category is dying (and with that the brand) it would have been the best thing.

Secondly, for the streaming business a second brand would have been appropriate. It is a substantial new business / category in which the company could have been number one again. This brand should have been positioned as the streaming service.

Thirdly, buying a generic domain “DVD.com” is really a waste of money. Consumers are not thinking “I’d like to rent a DVD so I go to DVD.com”,  they think “I’d like to rent a DVD so I go to Netflix.com”. The DVD.com “brand” is a waste of money.

 

General

How iA Writer is reintroducing the word processor category

Something amazing happened last May when a company called Information Architects  released the Mac version of iA Writer, “a digital writing tool that makes sure that all your thoughts go into the text instead of the program.”.

Why is this is amazing? Well, iA Writer just entered the word processor category traditionally dominated by Microsoft Word and Apple Pages. Both Word and Pages are of course expected to do… well… lot’s of word processing…!

A closer look at the propositions of Microsoft Word and Apple Pages reveals that while these products in a distant past might have been about word processing today they are clearly about something else.

When looking at the Microsoft Word website the browser bar still says “Word 2010 – Document and Word Processing Software – Office.com” but in reality the focus of Word today is more on desktop publishing, as Microsoft says Word is “More than words”.

“More than words” is made possible through 3 sub propositions, none of them about word processing:

There you have it… Word 2010… bye bye word processing, hello to desktop publishing!

Over at Apple with Pages the situation is very much the same. The promise of Pages is to be “both a streamlined word processor and an easy-to-use page layout tool. It allows you to be a writer one minute and a designer the next, always with a perfect document in the works.”

There is a bit more word processing going on here but the end conclusion is the same: bye bye word processing, hello to desktop publishing!

While Microsoft Word and Apple Pages have left the word processor category and are moving into the desktop publishing category the move made room for new entrants: hello iA Writer!

What is iA Writer doing? Well, it simply is a 100% word processor. “One of our goals was to create a writing app without settings. When opening Writer, all you can do is write. The only option you have is full screen and FocusMode. To increase the pleasure of writing is exactly what we intended when creating Writer. A better tool doesn’t make a better craftsman, but a good tool makes working a pleasure.”

All of this supported by three propositions:

Yes, iA Writer looks a lot like… a word processor:

iA Writer has 8 key features: 1. Auto markdown; 2. Professional Typography; 3. Spell Check; 4. Words & Character Count; 5. Reading Time; 6. Focus Mode; 7. Disappearing Bar; 8. iCloud compatible

Amazing isn’t it? A product build upon 8 key features to deliver … a product that is really optimized for writing. While most of the 8 key features look familiar and can be achieved in e.g. Word there are four things that make the product stand out and differentiate:

  1. It is a true word processor, the only thing it does is … word processing and everything is optimized for that.
  2. No additional features included:  the creators of iA Writer were able to resist and keep focus
  3. Typography, designed by “the best type, screen and graphic designers in the industry”. Of course it makes a difference to look at something beautiful when writing something even more beautiful
  4. Focus mode: this is the real differentiator: in Focus mode all the text fades out except for the sentence you are working on so you can, well… focus.

The result of delivering a focused product is pretty stunning: iA Writer is a top 10 app in the productivity category on the Apple App Store. Even more stunning since in this category the top 4 apps are Apple products, including Pages ranked 2.

Furthermore the consumer ratings are high: 4.5 stars with lots of raving reviews with titles like “an app I didn’t know I wanted”, “Professional Writers, Rejoice” and “Insanely gorgeous”.

So here you have it: when companies or products leave the category in which they originally entered it leaves space for new entrants, even in the word processor category that I never thought would be such an exciting category! How wrong I was!

iA Writer shows us that when you focus your product in a category occupied by “do it all” products you do get noticed and can reintroduce the category to consumers. Well done iA Writer!

Mac owners: get iA Writer on iTunes

General

Barnes & Noble: scary outlook in declining market

New York Magazine published a very interesting article about Barnes & Noble a while back. The article gives an insight into the thinking and doing at B&N.

Some quotes from the article and facts from other sources:

  • The founder of B&N, Riggio, told a reporter a decade ago “I wake up and say that any business created before 1997 is going to be a fossil by the year 2010.”
  • Yet, the company’s retail people saw Borders as the real competition
  • Investing in technology was minimal “enough to be meaningful but not enough to cannibalize.”
  • Amazon launched in 1995. B&N launched their website in May 1997.
  • B&N debuted an e-book store in 2001. The adventure lasted a couple of years. Apparently there was also an e-reader but I did not find specs online (“too early is as bad as too late”)
  • Amazon launched Kindle in 2007
  • B&N launched Nook in 2009
  • Kindle books sell more than hardcover books in 2010
  • B&N pays about $13 wholesale for a hardcover book that retails for $26. With e-books, margins are far lower—as of now, typically in the neighborhood of $3 or $4.
  • As of July 31, 2010, B&N operates 717 bookstores in 50 states and the District of Columbia.  Barnes & Noble College Booksellers operated 633 college bookstores at colleges and universities across the United States.

I found this a scary recap of what has happened with B&N and the environment it operates in. For sure I hope B&N stores will not have the same faith as the Virgin Megastores (last store closing in NY). To me B&N stores equal a cosy environment in which you can browse and explore in peace or with some coffee topped with knowledgable and friendly employees.

What would you do if you were heading B&N, how would you continue to differentiate?

Update Feb 17: Borders filed for Chapter 11 first!

General

Amazon Prime – best thing ever for consumers (who pay) and killing competition in a blimp

amazon-primeI got last month a trial to Amazon Prime. For those who do not know: Amazon Prime requires a 79USD membership per year and as a result you get free 2 day shipping on products that qualify for Amazon Prime. And…. there are many many many products that qualify!

So, what has happened in terms of my consumer behavior over the last month… I simply go to Amazon for pretty much everything and bypass any other online retailer. Baby stuff? Should I go to Babies  R Us? Probably before Amazon Prime I would have but hey… with “free” shipping at Amazon why would I pay anything to Toys R Us for shipping? Camera stuff? Previously I would go to Adorama or B&H Photo Video, now I go directly to Amazon. Computer stuff? Previously Newegg, now Amazon…  and so on.

Amazon plays this smart. On top of me switching from other online retailers to Amazon I also see an uptake in stuff that I order from Amazon… because its so easy, no need to pay for delivery and the package will be at my home in two days… Why bother with anything else?

Lessons: ask consumers to pay a relatively small fee for something that could limit their online purchases (benefit retailer) and take away the biggest frustration for consumers when purchasing online (delivery fee and delivery times). By applying the benefit to as many products in Amazon’s catalogue Amazon virtually has a common differentiator against vertically (focussed) online retailers. On top of Amazon’s sharp pricing it is one way to differentiate competition.

General

Now Happy Jetting on any airline, thanks to JetBlue flyers collection

jetblue-happy-jettingThe New York magazine came today with a surprise: a small booklet with useful ‘products’ for those times one is not flying on JetBlue. The whole booklet is just so fun and so smart! It truly builds on the brand slogan “Happy Jetting” in a very funny way and more important hits home run in terms of differentiation. I am sure that this campaign will increase the playfulness JetBlue. Do check out the brochure online.

Here are some of my favorites:

The Knee Jockey: everybody who has been on Finnair tourist class from Helsinki – New York should standard get one.

jetblyue-knee-jockey

And for that same Finnair flight it would be great to have that seat back peeper:

seat-back-beeper-jetblue

What will you order? 🙂

General

When you connect your brand to a country make sure you do it all the way, Air-O-Swiss case

Recently I was in the market for a humidifier. East Coast USA gets quite dry during winters and I wanted to make sure the apartment stayed at a comfortable level. Not knowing anything about humidifiers I went to my favorite online retailer Amazon for some investigation and product comparison. This is how humidifiers look at Amazon.

humidifers-amazon

Well…. it appears that pretty much all humidifiers have problems of some sort. Just read those endless stories on Amazon.. What I did learn was that it is important to have one that is easy to clean and does not make a lot of noise.

So, I had to make up my mind and found one humidifier made by a company called Air-O-Swiss from Switzerland (obviously)! What could be better than a humidifier made by a company from Switzerland? The country in the Alps? Images of the mountains, the clean air, the lakes, the snow, the purity immediately came through my mind… and I was even more convinced after visiting the Air-O-Swiss website:

air-o-swiss

Don’t you just see Switzerland boozing from the site? The mountains, the snow and even the flag of Switzerland in the logo and displayed as favicon in your browser address bar! Air-O-Swiss has it all connected to Switzerland: I wondered whether the company should just rename itself to Air Of Switzerland.

So, with all that knowledge I was super convinced! I was willing to pay the extra dollars for a product from Europe. It would be something different than all the products here in the USA that are made in China (clean air in China anyone?). I placed my order at J&R and picked up the humidifier later in the day. The sales box design was again boozing Switzerland. I was even more convinced this was the best choice. Air-O-Swiss has its brand identity in order, it is all working really well!

At home I installed the humidifier, turned it on and enjoyed the fresh humidity with a taste from the Alps and Europe. It was a total feel good!

Air-o-Swiss... made in Korea!
Air-o-Swiss... made in Korea!

The next day when I brought the sales box to the paper recycling a total disappointment started to sink in. Just when I unfolded the sales pack I noticed a little note … “Made in Korea”… WHAT???? Gone was that wonderful fresh air of Switzerland feeling… gone was the feeling I had bought a European product…. gone was the feeling that my humidifier was somehow better than all those “Made in China” versions…

Here is what I would suggest to Air-O-Swiss: when you tie your brand so close to your country Switzerland (from brand logo and other visual identity elements) and when you ride so hard on the Switzerland ‘fresh air Alps’ train don’t damage those great differentiators by assembling your products outside of Switzerland. It really turned a great story into disbelief.

General

Did the processor speed of PCs and Mac finally stop being a key differentiator?

I have been reading with great interest a post from my friend and former colleague George Pneumaticos in which he is ranting about the fact that Apple brought out a new MacBook just two weeks after he purchased his.

It struck me when George was comparing his “old” MacBook with the new one: he compared design, the trackpad and display. No word about the slight increase in processor speed. True, it is only a slight increase but still. Similar feeling I got from a lot of the review sites that covered the new MacBook and the new iMacs: it was more about the esthetics than raw processor speed. This even though only a while back speed was the key differentiator.

What is happening here? Have we all realized that it does not really make a difference at all whether a browser loads up in 5 seconds versus 4.5 seconds? Have we realized that not everybody is a video editor and that therefore Mac Pro speed is not required in an iMac? Have we stopped playing 3D games that actually only can be played with processors not even on the market? Or have most of us simply switched from using primarily native apps that rely on processor speed and memory to browser based services?

This is an interesting moment in the PC/Mac industry and the big question is: what will be the next real differentiator?

And for those interested: the story of George seem to get a happy end!

General

“Seeing the Future in 3-D Television”? TV makers: go horizontal

With a lot of interest I read the NY Times article “Seeing the Future in 3-D television” (link). It’s great to see TV makers trying to expand the possibilities to enjoy content. Of course the 50 USD a pop for the special 3D glasses and not to mention the additional production costs for studios to optimize their footage for 3D might just halt this innovation but in the end: if consumers want it, why not?

I think though that TV makers should rethink the “TV” brand drastically. In stead of improving the basic media consumption on the screen it would be better to expand the meaning of a TV. Think about it: 3D is just an additional option after black/white, color screens and HD screens. These technology changes have not changed the meaning of TV, TV makers brands and value at all.

In fact: since the arrival of cable boxes the basic user experience is not anymore with the TV brand but it is with your Time Warner provided cable box… When was the last time you touched your TVs remote control? Yes, the cable box made the TV maker brand almost irrelevant.

So, TV makers here is an idea: expand the meaning of the “TV” brand by going horizontal. Incorporate all the features of an Apple TV (with better storage, connection and video codecs), add internet connection, get partnerships with Netflix, Amazon, Hulu all to bypass cable providers. Make the TV the center piece. You can expand the meaning of TV and with that the meaning of your brand. And that can only be good: moving from a TV maker of “well designed TVs with a good screen” to a maker of “TVs with instant access to all entertainment regardless where it is” will have much more value in the long run.

General

Starbucks: you make me feel good!

Over the last months Starbucks has done a fantastic job in injecting their core brand promise to the public. Ranging from NY times full page advertisement to outdoor posters the message was the same:  it’s not just coffee… it’s Starbucks. All backed up with quality & fair trade messages. I really liked this campaign and it did give me the ‘feel good’ feeling when sipping some vanilla latte at the local Starbucks.

Starbucks outdoor advertisementI mean: who would not be happy to know that the coffee beans used in Starbucks coffee come from well selected farmers and contains 3% of the world’s best beans? That must mean there is a lot of crap coffee out there! Even though I am sure nobody ever really bothers about that when drinking coffee in a restaurant or even at home: ever seen a pack of coffee in the local super market that contained the worlds 1% best coffee beans?

So, why does it work here so well? My take on it is simple: quality and fair trade is a great differentiator in the ‘fast food / fast delivery’ segment Starbucks operates in … nobody else can claim it. The Starbucks message works very nicely against local deli’s/ supermarkets, Dunkin Donut, McDonalds etc.

I am a believer: in this segment there is only place to get a cup of coffee as good as Starbucks… it’s Starbucks!

New recipes that swear off artificial...
New recipes that swear off artificial...

Update july 12: this morning an other advertisement in the New York times. Enticing title “A cup of Starbucks coffee, a brand new blueberry muffin and all is right with the world”. How cool is that!? Especially when you read that the new recipes “swear off unappetizing artificial trans fats, artificial dyes and flavors, or high-fructose corn syrop”. Now that is even cooler! I feel now even better taking a high calorie muffin with my coffee:-) Point is of course: Starbucks is hitting home run with their brand promise and differentiating at the same time and is doing it in my opinion very well.