….and stretch: How far will O2 be able to stretch it’s brand?

Last week Ronan Dunne the thrusting CEO of O2 UK proclaimed a bold vision to create a lifestyle superbrand selling financial products, health and education as well as just plain old mobile phones.
I love a good vision, even more than the next man, but it’s always an idea to keep one’s weather eye alert when a CEO makes these sort of proclamations.
Stretching a brand convincingly and with commercial success is a real challenge. Many attempt it but few succeed. Those that pull it off usually have a powerful structural source of competitive advantage that they can use to ensure that the stretching delivers value to the customer. Rarely is this competitive advantage the brand.
Tesco have a retail distribution network that ensures that customers get a significant convenience benefit from the co-location of goods and services. Add their now legendary scale and they can provide aggressive pricing. The Tesco brand helps because it promises the customer these benefits but, to be clear, it isn’t the reason why the customer buys from them. 
Apple have created technology platforms that have allowed them to develop lucrative content delivery businesses in addition to the hardware sales. These revenue streams are based on providing access, integration and ease of use benefits to their customers. Their brand surely helps but for most of us the reason we use iTunes is because it’s easy rather than Apple.
Virgin is somewhat the exception that proves the rule. The Virgin brand has stretched across multiple products and services with the brand promise of something different, younger and more entertaining. Oh and Richard Branson to carry it through. These benefits create stretches that work for them in the service space where the customer gets a better experience: Virgin Atlantic, VirginMedia, to a certain extent VirginMobile, and even (when they work) VirginTrains. Many of Virgin’s stretches haven’t worked; VirginVie, VirginBride, VirginWine, VirginBooks are much less convincing.
Stretching too far has even taken the scalps of some of the best management companies in the world. Anyone remember Saatchi’s red balls falling onto shopping baskets that heralded Procter & Gamble’s stretch of Olay into Cosmetics? That lasted only a few years and made no money.
So where does that leave the Mr. Dunne’s superbrand vision? Well I think O2 are still searching for their stretchable competitive advantage. The best they’ve come up with so far is “the mobile phone is the remote control for your life”. What this means is a bit of a mystery to me apart from a dangerous throw back to one of the worst movies of 2006 – Adam Sandler’s Click (no -don’t see it).
Maybe they mean that the mobile phone is a portal to other aspects of your life. Well that maybe true but that doesn’t provide a compelling reason to buy home insurance from my mobile phone provider.
Given it’s sounding all a bit unconvincing so far Mr. Dunne then tries to persuade us that O2 is (or will be) a trusted brand; that in a world of low-trust brands this will have us flocking to buy health and education from O2. This is dangerous territory – a word to the wise – anyone, CEO or not, who tells you “trust me it will be alright” is almost always, car-salesman-like, clutching at straws. Trust is built within a specific context of delivery and doesn’t easily transfer to other non-similar product categories.
However on the plus side the move to introduce member rewards such as free concert tickets at the O2 arena starts the notion of O2 being a “members club” which enables the stretching idea. The significant £5m investment O2 is making into social innovation in local communities through the “Think Big” campaign is also laudable and has the potential to add another dimension to the brand.
But are these advantages enough? I doubt it unless O2 can go back to the basics and clarify for their customers what real, tangible benefit O2 can consistently deliver as it moves from phones to finance to education.
Do you want O2 to stretch its brand? What risks and opportunities do you think they should take?

What do you think? Please comment below. 

Justin

Mail me: justin@basini.com
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INNOVATION THAT YOUR CUSTOMERS MIGHT ACTUALLY CARE ABOUT


I’ve been thinking about the new stuff that companies do.

Innovation. Too many projects in businesses are given that title. It devalues the word and what it should really mean. It leads to that sad statistic that 80% of new products launched don’t survive….which given companies are generally very risk adverse is a pretty pathetic hit rate.

Unfortunately most companies believe that implementing anything new is innovation, which is more a reflection of how difficult they make it to get stuff done rather than anything that would make a real person go “wow – that’s neat”.

That’s not to say that a whole range of things can’t build your business but if we are honest with each other most of it isn’t innovation. Try this simple categorisation test for the new stuff you or your company are working on:

CATEGORY 1Stuff your customers think you already do because you are behind the curve or is so obvious that you should do like….

  • An innovation CRM project that allows your company to know when a customer has called (all service companies want this and most don’t have it covered yet)
  • An innovation IT system that allows your company to see a single view of a customer (i.e. you know what products I have from you) (all the big banks want this but most don’t have it)
  • Servicing your account online or opting for e-statements (Barclaycard have been pushing this to their customers in the last year or so as they played catch up)

CATEGORY 2: Stuff your customers think you should do already like…..

CATEGORY 3: Stuff which customers recognise is new but don’t really care that much about like….

 

and finally if you have any left….

CATEGORY 4: Stuff which customers recognize is new and really want like…

  • A truly easy to use fusion mobile smartphone that moulds to your needs (the iPhone)
  • A drink which is 2 of your 5 day and tastes great (Innocent Smoothies)
  • Off-set mortgages (Virgin One Account – this was a real financial product innovation which gave a real benefit to some)
  • Hybrid cars (Toyota and Honda – true technological innovations)
  • LED lightbulbs (which replace 50W halogens with 4W almost never ending bulbs)
  • Widgets which gave a smooth pour from a can (can’t remember who launched this first Guinness? Boddingtons? – but it was an innovation that delivered a real benefit)
  • Wash and Go 2 in 1 shampoos (yes – even this was a true innovation which solved a customer need that of simplicity)

It’s the last category of course that are real innovations requiring significant investments and creative thinking rather than battling with internal restrictions and bureaucracy.

How much of what you are working on that is called “innovation” could really be placed in the last category? If it’s lots that’s great – I can’t wait for these new breakthroughs to get to market! If it’s lots in the other categories (as I suspect it will be) that’s not necessarily a bad thing but make sure you don’t believe your own “innovation hype”- because it’s your customers that really know whether what you’ve just launched is new, truly different and worthy of lasting.

As ever I would love to hear what you think. Get involved, share your ideas, comment below – every comment wins a personal thank you from me!

Hope “The Teenies” are treating you well!

Justin

Mail me: justin@basini.com
My website: http://www.basini.com/
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I can’t believe it – bing wins – a better search engine than Google!

Got frustrated tonight with same old stuff coming up on Google. Had a novel idea….what about trying Bing?

And….oh….my…..god….it was better than Google. Different, more relevant, somehow deeper results. Google seems to be getting more and more surface, whereas bing revealed some truly interesting content linked to my search more deeply.

I for one thank the lord that I now have an alternative to Google, or maybe my alternative to Bing will be Google going forward?

IS TWITTER IN TROUBLE?

Interesting chart on Twitter uptake – is the deluge of new users slowing to a torrent?

Justin Basini
Web: www.basini.com
Read my blog: www.blog.basini.com


From: SAI Chart Of The Day <newsletter@businessinsider.com>
Date: Wed, 2 Dec 2009 22:40:53 +0000 (UTC)
Subject: Is Twitter In Trouble?

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Silicon Alley Insider - Daily Chart

Wednesday, December 2, 2009

Is Twitter In Trouble?

New users aren’t signing up for Twitter like they used to, according to numbers provided to WebProNews by a developer with access to Twitter’s API.

9.4 million users tweeted for the first time in July, and that monthly total has only declined in the four months since.

Keep in mind, though, that while the month-over-month numbers don’t look great, Twitter is still growing at a much faster pace at the end of 2009 than it was in the beginning.  7.1 million new users tweeted in November 2009, whereas only 1.3 million people joined the service in January.

And, to be fair, Twitter’s growth numbers spiked like crazy when Oprah joined the site in the spring, and again when the world media began calling Iran’s revolt the “Twitter Revolution.” It’s unrealistic to expect those kinds of surges to sustain themselves.

Still, we’re sure the investors who made Twitter a $1 billion company only a couple a months ago aren’t happy to see the site’s growth losing steam for four months straight.

(One way Twitter could fix the problem? Do a much better job of explaining to new users how the thing works.) Read >

Also On Silicon Alley Insider Today:
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Patent Research Startup Article One Partners Is Doing Great!
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Battle of the Big Thinking….Escaping the Matrix

Well after what seems like a very tough few weeks with wet towels wrapped around my head I emerged nervous and sweating for The Battle of the Big Thinking conference organised by Campaign and sponsored by APG.
You can see the presentation plus a slidecast of the speech and the core ideas at:
Have a look and share your thoughts – there is a great debate to be had about marketing’s impact on our society and consumption economics. Let’s start…..
Thanks
Justin

The different role of social networks Facebook v. Twitter

You can now listen to this blog as a slidecast going through the model and data. Click play below. Or you can just read the text below.

There’s been a lot written recently on some of the changes which Facebook have introduced to try and stave off the threat from Twitter. We all know that Facebook tried to buy Twitter in November last year and were rejected – so we know that Facebook is interested in micro-blogging and are pushing their status updates functionality.

This prompted me to think a little more deeply about the differences between Twitter and Facebook in terms of type of network built and communications employed. This leads me to believe that Twitter and Facebook (in their current forms) occupy different spaces and can co-exist quite happily.

The following diagram illustrates some of the differences between the major social networks in my mind based on the intimacy, time, numbers and purpose of relationships in a person’s life.

At the core of of our relationship map are deep, loving relationships with close family. Then comes our relationships with wider family and friends. After this are community relationships and relationships with our colleagues. Then we get into the areas where social networks have really had a major impact: previous or infrequent friends and contacts and even people we will never meet in the real world.

Facebook is perfectly positioned to fill the needs of interest and connectedness with a wider circle of friends we used to know or don’t see frequently. Of course it still has relevance for closer relationships but the new thing it adds is an unrivalled ability to stay in touch with a wider group of people that you have probably known in the real world. It’s optimised for this purpose through features such as approval of friends, having “on platform” media rich options (photos, videos etc), allowing detailed status updates.

Twitter is different to Facebook because it extends the social networking phenomenon into a new territory of those that you probably don’t know or haven’t known in the real world and is optimised for fast communications. It fulfils the need of curiosity on a broader scale – following famous people, or thought leaders, or organisations is interesting and engaging. In Twitter you can follow anyone and anyone can follow you – no need for approvals. Because of this there is no real responsibility to your network of followers – as I have put it before Twitter is take it or leave it communication. Of course many of us (including me, @justinbasini!) try to share interesting updates but there is no expectation which there is more of in Facebook.

LinkedIn is a good example of a vertically focused social network focused on business contacts. It bridges between work relationships past and present, together with people you want to build relationships with in the real world for business or career success.

I think the usage numbers bear out the fact that Facebook and Twitter are used to serve different needs:

Time spent per user on Facebook is much longer than Twitter but Twitter has many more visits per month. This fits with a usage pattern that is less involved and more frequent. I also think the average number of connections is interesting. On average Facebook users have 130 friends. Social theory holds that groups of 100 to 150 are the most relationships that one individual can meaningfully hold. I suspect that this will grow as we get more comfortable with technology based contact but I don’t think this average will ever be 1000s.

Now clearly at the moment the number of Twitter followers on average is low at around 20. But what I think is interesting is that if you take the top 10% of Twitter users (who we could call the early adopters and might be indicative of future usage) their number of followers on average is 483 and it is increasing fast. I think the average number of followers on Twitter could well be 1000s in the future. This definitely means it will be a different sort of network to that which one has on Facebook and potentially very exciting since you could use it to get an insight into many more different people around the world.

As always PLEASE feel free to comment with your views and share with others who you think might find this blog interesting. Oh and please follow me on Twitter (@justinbasini).

Yours

Justin

justin@basini.com
http://www.basini.com/
justinbasini.blogspot.com
www.twitter.com/justinbasini

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WHAT IS INNOVATION REALLY?

The launch of a new book has had me reflecting on that most overused and misused word in the business lexicon – Innovation…

That book is Jeremy Gutsche of Trendhunter.com book: EXPLOITING CHAOS. Jeremy has kindly allowed me to link to a free download of pages and examples from the book.

It looks really exciting to me – I’ve always enjoyed the more visual business books such as Tom Peter’s The Pursuit of Wow or The Medium is the Message by Marshall Mcluhan and EXPLOITING CHAOS looks extremely enticing.

Some of Jeremy’s ideas and thoughts are powerful. He has created a good resource in this book of examples, ideas and provocative challenges that will help to inspire and stimulate thinking.

I’ve always thought that we should hold a high bar to what we regard in business as innovation. During my corporate career I seemed to be constantly working on the next “innovation” as were my colleagues. I think many businesses use the word to make people feel better about the work that they were doing! A new ad, a new twist on an existing product, a new concept in an existing category – most likely they aren’t going to be an innovation.

In my mind innovations need to meet at least the following criteria:

1. Its a truly new idea or the exploitation of an existing idea into a new context: like the invention of the lightbulb, or the creation of a domestic compact flourescent bulb; or the invention of the telephone or the cellular networks which enabled mobile phones;

2. It delivers something new against a new or existing need meaningfully and for the long term. I think an innovation should have context – it can’t be a good idea for the sake of a good idea.


The Honda hydrogen fuel cell car, for example, I think will be seen as truly innovative over time because it moves us on significantly into new long-lasting territory. Whereas the Toyota Prius won’t stand the test of time because whilst it was a step forward (and a good one), it didn’t fundamentally deliver against the need meaningfully and for the long term (although the harvesting of electrical energy from braking that Toyota developed is an innovation which I suspect will last).

3. It should significantly challenge the existing status quo. The introduction of an offsetting mortgage, much touted as a financial innovation, didn’t meet my bar – it was a good product and clever but not an innovation. Zopa, on the other hand, a marketplace for you and I to lend to each other safely is an innovation – it challenges the exisiting significantly and is truly novel.

The debate over innovation will go round and round. I just hope that more businesses can deliver value against our needs, whether they call it invention, innovation, or just plain old tweaking.

What do you think? As always please feel free to share, retweet, comment and get involved.

And congratulations to Jeremy on the publication of Exploiting Chaos.

Yours

Justin

justin@basini.com
http://www.basini.com/
justinbasini.blogspot.com

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5 Reasons why Twitter is the next evolution in the democratisation of communication

As many of my friends and family will attest I am a dedicated supporter and active user of Twitter. If I needed any more excuses to use my Blackberry, Twitter has given them to me. Lots has been written about the Twitter phenomenon but I wanted to share why I think Twitter has a really good chance to be a communication channel of long-standing and power.

1. Twitter is the first “feed” of interesting Internet information and opinion that can be accessed with no technical expertise at all. Since using Twitter I am now learning and consuming much more insight from the web. Blogs, articles, comments, stats have all opened up to me since using Twitter. Following a Guy Kawasaki (@guykawasaki) or a Mashable (@mashable) (even if you follow no one else) is a brilliant source of some of the best the web can offer. Add in a Jonty Fisher (@jontyfisher) or a Dan Schawbel (@danschawbel) and you are building a pretty powerful set of insight about marketing and branding (my field). I don’t think I am a Luddite but I could never really get RSS feeds and such like to really work – Twitter users aggregate, edit, filter and share better than any technology.

2. Twitter is entirely non-hierarchical and democratic. Everyone is open to everyone (you can limit updates to only those that you select but not many people do this). I’ve had tweets replied to from Lily Allen (@lilyroseallen) and even got a reply from the great Guy Kawasaki (@guykawasaki). To give you an example last week I was watching BBC Breakfast News watching a really good segment by Ray Snoddy (@raymondsnoddy) on media and advertising. I idly (and somewhat cheekily) tweeted that Ray looked like he was wearing a wig. Within a few hours the tweet had reached him and I had a good humoured reply from the great man. This form of communication is powerful – I don’t need to search for his email address – or write him a letter – I am in touch with him because of the network in which we particpate. This democratisation of communication can be a powerful way to open up those in power whatever field they are in.

3. Twitter can give you insight into the lives of others. For example I follow my local MP and now the Minister for Transport Sadiq Khan (@sadiqkhan). Sadiq is a great example of a politician that is using Twitter to inform the man on the street (i.e. me) about what he is doing and the things he thinks are important. Throughout all this furore over MPs expenses and trust I’ve been really heartened to see Sadiq tweeting about what he thinks and sharing what he is doing. He works really hard (and seemingly all the time at this event or another) and I’m glad that I know this – it builds my trust in him.

4. Twitter can give many moments of pleasure connecting with real world friends across the world. When I first heard of Twitter I thought that knowing that Jon was eating a sandwich in Montreal would be an irrelevance and a waste of time. But actually now that I use Twitter one of the most powerful emotional benefits is knowing that my friend Tobias (@implant_direct) is enjoying a party in Zurich or Tom Farrand (@tomfarrand) has just had a great time kite surfing on the South Coast. These are vicarious moments of joy through Twitter that I wouldn’t have otherwise.

5. Twitter is take it or leave it communication. Lastly one of best things about Twitter, different from almost all other modes of communication, is that Twitter can be picked up or put down at will. A tweet, a direct message or a reply doesn’t need to be responded to instantaneously but it can be. That’s one of the best things about the channel – its so flexible. If you don’t want to tweet for a few days no one is going to accuse you of ignoring their voicemail, email or letter.

Twitter adds a lot to my life and I think it is a powerful new form of communication that has a lot of potential. So if you are a confirmed member of the Twit-sphere good for you; and if you are thinking of taking the plunge go for it.

As always please feel free to comment, share, RT, agree or disagree. Also follow me on twitter!

All the best,

Justin

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