Laws of Branding: The Law of The Word (#5)

Originaly by By Al Ries and Laura Ries

The Law of The Word

A brand should strive to own a word in the mind of the consumer.

Volvo owns the word “safety”. Mercedes owns the word “prestige”. BMW owns the word “driving” and the idea of being fun to drive.

Kleenex is tissue. People say “I need a Q-Tip”, “Make me a Xerox copy” and “Please hand me the Scotch tape”. These brands own the word in their respective categories simply because they were first.

What word does Federal Express own? “Overnight” of course. What about building a prestige brand?

To be successful in branding a “prestige” product or service, you need to:

• Make your product or service more expensive than the competition.
• You need to find a code word for prestige. Mercedes used “engineered”.

Laws of Branding: The Law of Advertising (#4)

Originaly by By Al Ries and Laura Ries

The Law of Advertising

Once born, a brand needs advertising to stay healthy.

After the initial explosion of publicity, a brand needs to shift its strategy from publicity to advertising. If nations have a defense budget, a leading brand needs advertising as its defense budget. The advertising budget is an insurance against attacks on the minds of consumers by competitors of the brand.

Advertising keeps a brand leader in the No.1 position, and when you are No.1, consumer behavior shows people will continue to choose your brand over anything else.

• e.g. Coca-Cola, Heinz, Budweiser, Visa, Goodyear

Use advertising to maintain leadership in your category.

Laws of Branding: The Law of Publicity (#3)

Originaly by By Al Ries and Laura Ries

The Law of Publicity

The birth of a brand is achieved with publicity, not advertising.
Anita Roddick built The Body Shop into a major brand with no advertising at all. She used publicity, communicating her ideas about the environment, indigenous people, and animal testing. It was endless newspaper and magazine articles, radio and television interviews that made The Body Shop a major brand.

How do you generate publicity?

The best way is by being First. Band-Aid, Charles Schwab, CNN, Compaq, Domino’s, ESPN, Heineken, Hertz, Intel, Kentucky Fried Chicken…these are just some of the major brands that were first in their categories, therefore inventing their respective categories.

Public Relations used to come second to advertising, but today publicity builds a brand, advertising maintains it.

Most companies develop their branding strategies as if advertising were theirprimary communications vehicle. They’re wrong. Strategy should be developed first from a publicity point of view.

Laws of Branding: The Law of Contraction (#2)

Originaly by By Al Ries and Laura Ries

The Law of Contraction

A brand becomes stronger when you narrow its focus. There used to be a time when every neighborhood had a small coffee shop where you could get everything from breakfast, lunch, dinner, to hamburgers, hotdogs, pancakes, and ice cream, and of course, coffee. This was before Howard Schultz had a simply wonderful idea: why not focus on selling great coffee? Today Starbucks Corp. is worth $8.7 billion on the stock market.

Schultz focused on coffee, but that doesn’t mean he just offered one, Starbucks offers thirty different kinds of coffee.

Narrowing the focus has resulted in big time success stories:

• Toys R’ Us narrowed the focus from the original Children’s Supermart concept carrying kid’s clothing, children’s toys, baby food, and diapers down to a store that offered a greater selection of toys.
• Subway specializes in the submarine sandwich.

To be the brand that rules your category, these are the five basic steps:

• Narrow the focus.
• Stock in depth.
• Buy cheap.
• Sell cheap.
• Dominate the category.

Laws of Branding: The Law of Expansion (#1)

Originaly by By Al Ries and Laura Ries

The power of a brand is inversely proportional to its scope.

If you want to build a powerful brand in the minds of consumers, you need to contract your brand, not expand it.

Putting your brand name on everything diminishes the brand name’s power. Take a look at Chevrolet, a company that used to be the leader in the automobile industry. It expanded its brand into Corvette, Camaro, Caprice, Lumina, Malibu, Prizm, and so many other brands. People don’t exactly know what a Chevrolet is anymore. What happens when you extend your product line into so many types?

You steadily lose your market share.

In 1988 American Express had 27% of the market. Then it expanded into offering Senior cards, Student, Membership Miles, Optima, Optima Rewards Plus Gold, and a whole range of other cards. Their market share is 18 per cent today.