Brand Relevance: Making Competitors Irrelevant [Hardcover]

Success in business is not about winning the brand preference battle so much as the brand relevance war with an innovative offering that achieves sustainable differentiation by creating a new category or subcategory, according to David Aaker in this book. Conversely, brands often decline, not because they have lost their ability to deliver or the loyalty of their customers, but because they have become less relevant.

The book goes on to describe numerous examples of companies which have gained substantial competitive advantages by creating in the minds of potential customers a new category or subcategory of product. Examples from the field of retailing include Muji, IKEA, Zara, H&M, Best Buy, Whole Foods Market, Subway and Zappos. Examples from the automobile industry include the Toyota Prius, the Saturn, the Chrysler minivan, the Tata Nano, Enterprise Rent-A-Car and Zipcar.

Creating brand relevance is a matter of framing new categories and sub-categories and influencing customers' perspectives by creating mental associations. To create new categories, an organization must be involved in finding concepts, evaluating them, using them to define new categories, and creating barriers for competitors. All is not lost if a company finds itself becoming irrelevant; the author gives plenty of examples of companies which have recovered relevance through renewed innovation.

There are numerous other books available which discuss the importance of differentiation, but none describe it quite in the same way as the present author does. Differentiation is important, but a key aspect of business success lies in communicating the differences to the target market in such a way as to excite ongoing interest. This book is a bit longer than I would have liked, but the author's advice and conclusions seem to be very pertinent.

The first thing a reader notices about Brand Relevance is how many of today's power brands have already made good on its central concept: Brand preference has long ceased to be a powerful driver of marketing success. Brand success, therefore, requires something more. That something, according to David Aaker, now vice chairman of Prophet, a marketing consulting firm, "is to redefine the market in such a way that the competitor is irrelevant or less relevant, possibly by making the competitor's strengths actually become weaknesses." This requires creating brand relevance by carving out a new category or subcategory for your offering that has these key characteristics: a weak or nonexistent competitor set, a distinctive definition, a value proposition, a loyal customer base, and, perhaps most importantly, barriers to competition.

In defining the characteristics that enable some brands to surge past others, Aaker brings an academic's eye to the question of why some brands transcend their markets, and the result is a book thick with examples and lessons. One of the prime examples that Aaker uses to describe brand relevance is, of course, Apple Inc., particularly its roster of "i" products. Not only are they great products in and of themselves, he writes, but they also create substantial barriers to entry that keep other brands from competing directly. Nowadays, there are plenty of smartphones besides the iPhone, MP3 players besides the iPod, and tablets besides the iPad, but Apple's products are also part of the larger iTunes ecosystem of audio, video, and apps. That's quite a barrier. As Aaker points out, each Apple innovation also builds on existing ones, to make the company a "moving target," which is a core component of ensuring that a brand is continually relevant.

Aaker also writes extensively about other breakout brands, such as Toyota's Prius, but many of his example products are decidedly more prosaic. If you market toothpaste, you will be able to read this book and get ideas for how to break out of the mold. (In fact, Aaker devotes specific attention to the toothpaste category.)

Additionally, the book offers a comprehensive look at the kinds of factors that can make a brand relevant, which sometimes means looking at an established category such as car rentals in an entirely new way. Aaker cites Zipcar Inc., whose founders recognized that sharing a car makes more sense than owning one for some people, as probably the brightest example of the brand relevance concept.

Started in 2000 in Boston, Zipcar had 350,000 members and 6,500 vehicles by 2010, focused mainly in urban centers and on college campuses. Members can reserve cars minutes before they need them, anytime, day or night. Although Aaker points out that the rest of the industry has responded by developing "more flexible" ways to rent, Zipcar has maintained its relevance not only because of its service, but because "rather than being about renting cars, [Zipcar is] about urban life and the freedom of not owning and maintaining a car but still having access to one. In that spirit it provides a way to cope with urban living in a fun, upbeat, and environmentally sensitive way." It's hard to see how an Avis or a Hertz could capture the same magic, even if it had programs that offered identical benefits.

Other ways that brands can be relevant include providing a unique customer experience (Starbucks), being a brand that offers "over-the-top service" (Zappos), and, in an unintended tip of the hat to We First, aligning themselves with some greater good.

It's clear from these examples that the ability to make brands relevant involves much more than the marketing department. Thus, Aaker devotes the book's last chapter to dissecting cultures of innovation, such as General Electric's. Among other initiatives, the company inaugurated an Imagination Breakthrough program in 2003, which charges every GE business with proposing new products and services that could make $100 million within three to five years. "The rude fact is that not all organizations allow ideas to emerge, nurture those ideas, and implement them in the marketplace," he explains. Brand relevance may be a relatively simple concept; building it is not.

Those who have read any of David Aaker's previous books already know that he presents information, insights, and counsel that are anchored in specific real-world circumstances within a broad and deep frame-of-reference. Brand Relevance is no exception. On the contrary, I think it is his most important, his most valuable book thus far. In Reality Check, Guy Kawasaki shares everything he has learned thus far about how to (and how not to) "outsmart, outmanage, and outmarket your competition." In his latest book, Aaker shares everything he has learned thus far about how to (and how not to) "drive change through innovations that will create new categories and subcategories - making competitors less relevant -[so that] other firms can recognize the emergence of these new categories and subcategories and adapt to them."

As he explains, the way for a firm to get on top of its strategies in a time of change is to achieve these four strategic objectives: (1) Complete and then follow a process by which to create new categories and subcategories that make competitors irrelevant; (2) Apply the brand relevance concept to the given circumstances and leverage its power as a way to drive and understand dynamic markets, (3) understand how and why brand relevance can be diminished or lost as well as how and why to avoid or replenish that loss; and (4), understand and develop or strengthen the characteristics it must have "to support substantial or transformational innovation that will lead to new categories or subcategories."

Aaker identifies with meticulous care the "what" of these and other strategic objectives, then devotes the bulk of his attention to explaining how to achieve them. To support his results-driven approach, he makes brilliant use of 25 mini-case studies of a remarkably diverse range of companies that include IKEA, Best Buy, Whole Foods Market, Zappos, Zipcar, Apple, Segway's Human Transporter, Salesforce.com, and Walmart. As these and other exemplars have clearly demonstrated, companies are most relevant when their clients depend on them to help them be most relevant to their own clients. Here in a single source is about all the information, insights, and counsel any C-level executives need to ensure that their companies gain and then sustain brand preference and thereby make their competitors irrelevant.