There was something of a panic back in 1988 when Australian firm GFW made its hostile bid to acquire Rank Hovis McDougall. The British conglomerated company owned a wealth of power brands ranging from Bisto to Mother’s Pride to Sharwoods and was performing admirably.
But the accounting standards of the 1980s meant it was entirely feasible to acquire a company and then, by breaking it up and selling off its brands to other companies, realise a significant profit. The Aussies had caught wind of the idea and Rank Hovis McDougall was in its sights.
Fortunately, legendary brand man John Murphy was working as a consultant for Rank Hovis at the time. His naming and identity firm Interbrand had just completed work on a new digestive biscuit, which Murphy had recommended be called the Hobnob. His connection with the senior team at Rank Hovis meant he was aware of the Antipodean threat and he decided to chance his arm.
Murphy sent a fax to the chairman of Rank Hovis explaining that he had recently created a proprietary method for placing a financial value on brands. He was, he explained in the fax, certain that the assessment of the company’s extensive portfolio would improve its valuation significantly and far beyond the reach of GFW. Was the chairman interested?
He was. And Interbrand was swiftly engaged to value the 50 largest Rank Hovis brands. The takeover was ultimately thwarted by regulators but Interbrand’s valuation business was off and running. Some 20 years and many thousands of brands later, the company now produces the single most famous document in all of brand management: Interbrand’s Best Global Brands.
Last week’s top 100 list was ostensibly the same as all the others: a league table of the world’s most valuable brands expressed as intangible asset value. This year Apple retains its top spot with a brand worth $234bn, with Google, Amazon and Microsoft following up behind.
Much has been written about the merits and pitfalls of these external assessments of brand value. I even debated the senior executives from Interbrand and its two main rival valuation firms, Brand Finance and BrandZ, at a heated event at the Festival of Marketing in London many years ago.
For once, however, the financial estimations were not the most contentious part of Interbrand’s annual report this year. In an attempt to generate interest and keep Interbrand as salient as possible, the firm also attempts to come up with winning content to suggest that they are not only expert assessors of brand value but astute builders of it too.
That latter claim is far from proven. While big businesses like Prophet have been built on brand consulting, and the big audit firms have muscled in and made brand part of their portfolio, Interbrand’s strength in brand valuation is a core weakness when it comes to consulting.
If you want to put a value on your financial brand equity you’d be nuts not to use Interbrand. But just because you can measure something does not necessarily mean you can also make it bigger. It’s a bit like the official time-keeper for the Olympic 100m sprint deciding that he is so good with the old stopwatch that he fancies a go in lane four against Usain Bolt. One thing does not necessarily correspond with the other.
Strategic analysis lacking
And that suspicion can be confirmed if you look at the material that surrounded the 2019 top 100. This is Interbrand’s big moment. Its tactical Christmas, when the firm is guaranteed coverage in every global news outlet and a spot on CNN talking about brands to Kristie Lu Stout.
As usual the material looks great, betraying Interbrand’s origins in design and naming. But the strategic content is, well, pants. Its essay entitled The End of Positioning: Introducing Iconic Moves is meant to demonstrate its brand mastery and strategic chops. Instead it makes the team look like they need to go back to business school.
There is an interesting debate about positioning and differentiation going on…that Interbrand has clearly not bothered to read up on.
For starters, anyone who proclaims the ‘end’, ‘death’ or ‘disappearance’ of anything has not been paying attention. For the past decade we have suffered from almost every central concept within the marketing lexicon being served a death notice. You find me a core concept like research (dead), segmentation (also dead), branding (totally fucked) or TV (so dead it’s amazing we even talk about it anymore) that has not had the last rites read to it a dozen times, and I will give you two free tickets to the cinema (hurry, before it’s dead).
Pleasingly, the last 12 months have seen a general push-back on the funereal attempts to kill off everything we hold most dear. It would seem everyone except Interbrand got the memo. Because here it is in its signature publication for the year proclaiming an end to the “dogma of positioning”.
Apparently, things are moving too fast for brand positioning to be a thing anymore. Interbrand claims that “accelerating markets where customer expectations are perpetually moving ahead of business” make a strategic decision about what your brand is meant to represent completely pointless.
Interbrand also suggests that businesses will “no longer be defined by categories” and that, too, makes positioning pointless, even though the act of positioning rarely actually invokes the category and, very frequently, transgresses it.
Finally, “transparency and reduced information asymmetry” plus something else and then something else (I had lost the will to live by this point) also make positioning redundant.
Like I said, pants. And, worse still in an age that is meant to be evidence-based, it is entirely devoid of any proper data to support the pronouncement of the death of positioning.
There is an interesting debate about positioning and differentiation going on, and the degree to which brands can possess a perceived difference from alternatives in the market. But it’s a nuanced, evidence-led debate that Interbrand has clearly not bothered to read up on. It has just banged out 1,000 words and declared one of the oldest and most useful strategic approaches DOA.
And then there is the new terminology that Interbrand proposes to replace positioning with. You know how this works. Ever since Kevin Roberts proclaimed brands to be old-hat and proposed ‘lovemarks’ as the “future beyond branding”, marketers have had to put up with a theoretical bait-and-switch, in which established, enshrined concepts are burned and replaced with ideas hastily written on toilet paper.
Loyalty is dead; it is brand love that you should focus on. AI makes market research redundant. Digital kills traditional concepts of reach and frequency. The funnel is outdated but the consumer journey loop-a-thon is the way forward. Only in marketing do we attempt to knock down our theoretical cathedrals and replace them with rapidly inflated bouncy castles that smell of piss.
Interbrand, not content with killing off positioning, would like to introduce ‘iconic moves’ as the new strategic standard for brand building. I am not making this up. Interbrand wants you to rip up that positioning strategy and start working on some iconic moves. For fuck’s sake.
I feel bad for Interbrand. I’m not exaggerating; I got six – six! – emails from fellow marketers asking if I had read the new Interbrand report last week. And not in a good way.
That’s sad because, thanks to John Murphy, it is part of branding history. You cannot teach brand management without discussing 1988, Rank Hovis and the important events that followed. But just because it was part of the setup of brand management does not guarantee it a seat in the cockpit in the present.
Interbrand needs to urgently sit down and consider its amazing heritage. It must look at the pedigree its name still conjures in boardrooms all over the world and the positive associations its company connotes to so many.
It needs to look around at the new sources of strategic brand consulting that now threaten it on every side and which make it look flaky and out-of-touch by comparison.
Finally, it must use the firm’s extensive contacts to examine carefully what CMOs and CEOs are looking for when it comes to branding guidance. Then the company must make some strong decisions about what Interbrand does and does not want to do, and how it wants to present itself to clients going forward. Because another report like this risks making it look like a laughing stock.
Only by going through this process, which I believe used to be called positioning, will Interbrand find its way out of the forest and reclaim a more admired, more influential – some would even argue more fitting – place in modern brand management.