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Burberry:  Sustainable growth of the Check legacy

Overall Burberry has become less vulnerable in the world of fashion. Here are 4 strategic decisions they have made that have either increased or decreased their vulnerability.

Positioning - between Lifestyle and Fashion -> Increased vulnerability due to competition from both ends as well as requirement of retail presence in a large variety of store formats

Labels - Accessible/Functional vs Cutting Edge -> Decreased vulnerability by offering easier choice and decision making as well as signaling the technical cutting edginess of the brand.

Trends vs. Continuity - Balancing both -> Decreased vulnerability by ensuring heritage lives on while also not stagnating when competing with trends in fashion that could hit

Decrease licensing and SKU Count -> Decreased vulnerability in terms of increasing core group loyalty as well as expanding the target market segment.

Three kinds of brands that I identified to have significant resistance to counterfeiting are:

Luxury brands that are not observable. This makes them less likely to be abandoned by their core user group in terms of exclusivity. For eg. Underwear

Luxury brands that are highly functional whose value can’t be functionally replicated. For eg. Fragrances (they will never smell the exact same), Cosmetics, Arcteryx (high quality gear for the toughest environments)

If the luxury brand wants to enter a certain segment and whose observability (through counterfeiting) can spark more adoption in that particular segment. However this would work up to a certain extent.

An LLM tells us brands that have a strong reputation for quality, exclusivity, and brand image are less likely to be harmed by counterfeiting. I agree with quality, how I disagree on the latter two since adoption by dissociative groups or general mass market can signal loss of exclusivity and dilution of brand image to the core customer group and hence can end up harming the brand.

Customers help defend brands in a few possible ways, here are 3 ways:

Limiting their purchase when they see brand dilution. This acts as feedback to the brand that something needs to be changed.

Continuing to purchase more of the brand. This demonstrates loyalty and acts as signals to others that could aid in more adoption.

Helping with answering questions or solving problems within products of the brand for friends, family and the community. This demonstrates deep knowledge of the brand that results in higher customer satisfaction as problems are solved faster. 

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Applying the friction brakes to promote user awareness and agency

When communicating with Chat GPT and asking for answers on a particular topic it is quick to note a disclaimer that it is an AI tool and can’t be relied upon for certain use cases before proceeding to provide its comments. These disclaimers act as a good reminder for the user to understand that ChatGPT has certain limitations. Despite knowing ChatGPTs limitations and disclaimers, I often trust it more than I should in favor of the convenience it provides- all well and fine in the personal use cases I use it for but with unprecedented implications when used to make decisions at a larger scale.

One step further in the spirit of adding ‘good friction’ could be to explain how it came up with its response, that is the specific sources, concepts, and ideas used to come up with a response. This allows the user to then dive deeper into the topic with their own research. Another idea to potentially add good friction would be to assign scores on a few parameters to the response of ChatGPT. For eg. A confidence score of how accurate it thinks its response is. At the same time providing too much choice or information could have a negative reaction, including choice paralysis or build a default sense of mistrust so adding good friction must be balanced with experimentation to understand the degree to which it helps.

In terms of our project (to help the Marriott extend its brand to a younger audience that defaults to Airbnb for their accommodation) I would hone in on the “dark patterns” created by the existing customer journey of booking a hotel room. While both Airbnb and Marriott make it easy to book, the former clearly communicates the refund policy in a few words. However with the Marriott, the lack of standardization along with a paragraph long cancellation policy is indicative of a lobster trap. This is a low hanging opportunity to standardize and simplify. 

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Competing by delivering delightful CX

There is a reason why my parents will go out of their way to fly on Singapore airlines for long haul International travel - even if it means the flight time is longer. The exceptional comfort and in-flight service they have come to expect and receive from SIA at competitive prices outweighs all other factors when choosing an airline for their travel.

SIA changed the game by competing on an attribute that the industry previously didn’t consider competing on. By choosing to provide exceptional in-flight service, SIA positioned itself to meet passengers unarticulated needs while at the same time leveraging their low cost of labor to provide competitive fares. 

They initially translated great customer service to great CX with increased travel comfort (head rest, availability of food choices, wine), exceptional inflight service and expectations for it (the Singapore girl myth) and using the newest airplanes (clean, everything working well). Over time, they didn’t rest on their laurels and continued to double down on customer service through new initiatives: considering the CX through the entire passenger journey, adding innovations such as AVOD, and developing a unique culture of “caring for the customer” that diffused through the organization. 

Many of the actions taken by SIA be viewed through the nudge framework lens as nudges to reduce customer friction across the passenger journey (check-in -> boarding -> in-flight experience -> arrival -> baggage claim -> correcting for any deficiencies in the process). 

Using the 7 nudge tool kit, we can classify the nudges that SIA has makes to reduce friction and deliver exceptional CX for the passenger:

Assisted check in using “queue combers”  (Nudge via timing)

Staff looks for opportunity to assist passenger (Nudge via reducing effort)

Early boarding of certain passenger groups (Nudge via reducing effort)

Newer airplanes (Nudge via anchoring)

Exceptional in-flight service across cabin categories (Nudge via default)

Anticipating passenger needs (Nudge via expectations)

Quick dispute resolution at 1st point of contact  (Nudge via expectations)

Assisted arrival through “queue combers”  (Nudge via timing)

Prompt baggage arrival (Nudge via finishing strong)

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With great tools comes great responsibility

The Market research document outlines a menu of market research techniques from quantitive/qualitative, primary/secondary, experimental/non experimental that are available as options to managers to learn more about the market in order to assist with effective decision making. 

A couple key takeaways:

While each technique has its place and its own set of pros and cons, the underlying tone of the article that most resonated with me was that the manager must be deeply engaged at every step of the market research effort. Just knowing the techniques and what they can be used for isn’t sufficient. From technique selection, defining the problem statement, reviewing the protocol and research design, assessing economic viability of the effort, the data analysis approach and format of results presentation, there are numerous simple pitfalls at every stage of the market research process that can ruin the results and quality of the effort. An engaged manager can help avoid that if they are knowledgable, curious and collaborative. Hence with great power (ability to initiate and sponsor a market research effort) comes great responsibility (to ensure quality and success).

Don’t reinvent the wheel. This insight draws from the section of the article that talks about the value of secondary data. In my experience I’ve seen that there is a tendency to short circuit the question of “what data might already exist”. While applicability and relevance are key considerations to keep in mind while drawing insights from secondary data, investing time to understand what already exists can have huge payoffs both in terms of time and money.

For Branding lab, my initial proposal would be to solve for how a hotel brand (say the Marriott) can extend its brand to attract the younger demographic of travelers that majorly use Airbnb for their accommodation needs. I would use a combination of qualitative techniques (interview to understand preferences), quantitative techniques (survey or A/B test to understand response to new test new visual prescriptions), and secondary data (industry data available online and Airbnb, Marriott investor reports) to gain insight into consumer needs.

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Bring the beach anywhere!

Corona’s success so far has largely been built on a consistent marketing strategy that complements the nature of its product (“Vacation in a bottle”, “What you see is what you get”, “Change your lattitude”).

While imported beer traditionally banks on high quality perception, Corona’s marketing efforts have instead capitalized on what makes it unique from other beer brands: a fresh and clear beer that transports one to the good vibes of a tropical beach. It’s casual, easy to drink and can be enjoyed anywhere to have a fun time.

My recommendation to Corona is to (1) continue with their consistent marketing theme through ads that further cement customer’s perception of it being the beer of choice to enable a fun and casual time wherever they may be (2) Given that off-premises sales represents the largest volume, Corona should expand their same marketing theme to encourage the off premise sales channel. A fast-growing Hispanic population in the US will be a tailwind for them. (3) I would recommend against adopting a regional strategy due to the risk of inconsistent messaging.

Heineken’s weaknesses are an inconsistent marketing strategy, resting on their laurels and failing to connect with a young audience. Selling alone on the quality of their beer is a missed opportunity and they should go a level deeper (for e.g., Taste of their beer, their Dutch roots or even the emotions evoked when one enjoys a Heineken). Developing communications that support a consistent theme and defining what that theme should be for a young audience will be critical.

While both Corona and Heineken are imported beers, in the minds of the customers they are very different. Corona is a beer from Mexico that is fresh and clear (see through glass bottle) that is easy to drink, can be enjoyed casually with a lime and is a harbor of tropical beach vibes. Heineken on the other hand, is a beer that is a symbol of imported high quality beer from Europe.

Corona’s ad campaigns consistently have a beach background with catchy taglines that support the “Fun, Sun and Beach” theme. On the other hand, Heineken’s ads emphasize quality and an easy choice: beer poured out in a glass and quotes that communicate how they are the no brainer choice of high quality beer.