Discovering business opportunities

 Interview with Dr. Dan Herman, CEO of Competitive Advantages, a strategy consulting and branding services firm, serving worldwide clients ranging from local mid-sized companies to “Fortune Global 500″ corporations. Together with his highly trained team, he creates Unique Success Formulas, Emotionally Significant Brands and Short-Term ‘Hit’ Brands for their clients. Among the many organizations and brands, he has worked with are multinationals such as Coca-Cola, IBM, Unilever, Motorola, Roche Pharmaceuticals, Holiday Inn, Apple computers, Suzuki, Chrysler, Warner Brothers, H. Stern as well as many others. The list also includes FC Spartak Moscow and many of Israel’s leading companies in the fields of banking and financial services, telecommunications, health services, food and beverages, toiletries and cosmetics, public transportation, hotels, retail chains, the national lottery and several non-profit organizations, government agencies and political parties.

Great thanks for this interview, Dan! 

What can be said about the return on investment of a STB, when it’s compared with a LTB?  One should think more money can be made with a LTB.

I never said we should stop thinking long-term altogether. We must think long-term in the management of our companies and organizations. Even in marketing and branding we need to think both long and short-term. I advise my clients to use combinations of long and short term brands. They have different marketing roles. The long term brand inspires trust. The short term brand raises excitement. Oftentimes marketers should use a long term background brand (e.g. Volkswagen) but create excitement with foreground short term hits (e.g. the New Beetle). Most innovations are not ground breaking. They are, in our terms, Minimally Effective Innovations (MEI). In order to maximize their revenue potential it is preferable to create and market them as a series of successive short-term meteoric successes. Contrary to the traditional point of view it seems that now, as consumers are more responsive to novelty, it makes more sense to launch new brands instead of “new and improved” product versions under a long term brand.An expertly created and marketed short-term brand reaches a higher sales volume and market share than an long term brand and it is far less expensive to launch. From a financial perspective, a succession of short term brands achieves a higher average market share over time.

Is building STB’s possible or all kinds of categories;  e.g. cars, financial products or shaving?

The THINK SHORT paradigm is better suited for some categories than for others, however it can work wonders in most categories. Even in financial services, we have products and brands which are short-term hits (e.g. trust funds specializing in Biotech).  Also, some market situations are more indicative than others for using STB.It is particularly advisable to consider the creation of Short-Term Brands:

• When a strong market leader already exists
• Where technology changes and new developments are frequent
• When category experience indicates a short lived interest of the consumer in brands
• In product categories in which one or more of the following applies:
  • Product consumption is accompanied by a sensual experience.
  • Use of the product is public/observable and connected with Social interaction or can be used as a topic for conversation.
  • Benefit of the product is doubtful but the desire for the benefit is strong (diets) or the benefit perceived is at the fantasy level.

The THINK SHORT method specializes in such ‘marketables’ as: new ‘blockbuster’ products and seasonal products, new models / product versions, new technologies that will probably be replaced by newer ones before long, limited editions (e.g. in luxury),  projects: Real-estate, research, development and other types, campaigns (Political, Social, …), new entertainment venues (restaurants, bars, cafes, …), movies, TV programs or temporary channels, websites / web formats / web applications, aspiring celebrities and stars, shows / albums / tours, events / conferences / exhibitions / festivals  …, business and other processes (e.g. M&A), pop-up stores, pop-up everything and finally, startup companies (with EXIT strategies).STB are certainly essential for any product that is meant to become trendy and is very important for marketables that are short-term by nature, such as political candidacies or real estate projects that must create enthusiasm fast.

STB are better in tapping into the hectic lifestyle of consumers today, you write. Can you give an example?

Consumers have two basic groups of needs that marketers cater to: The first one is the need for safety, familiarity and trust. The second is the need for renewal, discovery and excitement. The second need is becoming increasingly important in our culture while traditional (long-term  focused) marketing and branding caters mainly to first one.Take for example Crocs (unfortunately for them they did not realize that they are marketing a short term hit). Crocs cater to the need for renewal that consumers have. After a while, Crocs will inevitably lose its ability to provide this sense of freshness and they will need some new brand and product to feel renewed. Think of cellular phones, it’s the same. As I said, it works in many categories.
 

What is the main difference in building (the techniques) a short term brand, compared with a long term one?

The first and foremost thing that is different is the state of mind, the intent and the approach. Other than that there are many differences in the process and in the tools being used. For example: we do not set objectives before doing a methodical Opportunity Scan (O-Scan) using innovative consumer research methods such as ForeSearch – a method for identifying potential desires which are unconscious to the consumer. We have special tools for innovation and product development such as the Market Hits Formula and for brand development, such as Brand Drama. THINK SHORT is a very comprehensive methodology. 

Comments(0)