ProfitBrand

By Nick Wreden

Nick Wreden has been a regular contributor to Pool in recent years and so the subject of his latest book is hardly a surprise. Profitbrand is not just another book about branding but it focuses on one of the key elements required by brands today. That is the rise of accountability of brands, indeed of marketing in general.

The term Profitbrand is used throughout the book to illustrate a brand that fits the criteria required for brands today. The brand must be accountable and that becomes a “given” to retain its investment. However, what makes a brand a Profitbrand. It is not just the fact that it is accountable but it is also highly attuned to the current consumer marketing environment. The word “consumer” is crucial here. We have moved out of the mass economy with its mass produced products and broadcast advertising into the customer economy where customer or consumer focus is everything. Nick Wreden suggests that the next and imminent step is the demand economy. The is a step-change from the customer economy in that everything is demand driven and this means working closely with consumers, developing personalised products and services. This leads to making brands profitable. The brand is not just the responsibility of the marketing department, not even the whole organisation but the whole supply chain. The growth in outsourcing is testament to this as branding and profitability of branding has to be present at all stages so that the consumer is delivered the optimum product or service for him or her.

Imagine the current situation. Everyone, it seems, is become interested in branding. No-one has products or services anymore, they have brands. However, many forget that companies do not own brands; they exist in consumers’ minds. Consequently, the brand may stand for different things for different people. This may help to explain why, despite the interest in branding and “customer loyalty,” actual loyalty to brands is falling, customers are becoming dissatisfied with offerings and there is a high rate of new product failure. Not only are many organisations still clinging to the baggage of the mass economy when consumers have moved on, or were never really there in the first place, but the lack of brands’ accountability means that they are not able to see what works and what doesn’t. The answer, therefore, is to carry on as you were.

Consumer marketing is becoming more like B2B marketing. One of the crucial elements of this is the fact that the customer is viewed as an individual, as a source of revenue and profit. This means that organisations will take time to identify those customers who deliver their profits and focus their marketing efforts on this group rather than those customers who do not deliver profits. Let them go to a competitor. Building revenue and profits from the existing customer base is not only easier but also substantially more profitable. Potential customers can also be identified as those who are more likely to become profitable customers, not just as those who will take up an introductory offer before moving onto the next supplier. This recognises the concept of lifetime customer value. Too many organisations are focused on measuring their new customer acquisition but little thought is given to measuring customer retention.

So it is not about selling your products and services to customers any longer. The Profitbrand will be focused on delivering customer value, to provide what customers want and to keep them coming back for more.

Nick Wreden’s Profitbrand is the guide book for the demand economy. This is not about brands, it is about delivering what customers want, satisfying needs and generating profit. Branding was very externally focused in the past but now it I a much more two-way process. The brand becomes built around the customer or consumer, not the organisation.

Published by Kogan Page 2005

Review by Martin Payne