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Aug 9th, 2010 posted by Ulf-Bruen Drechsel

ALDI is for everyone—a simple idea that has changed the retail world

Have you heard of the brothers Theo and Karl Albrecht?

In Germany, the success story of these legendary market pioneers has only just been thrust back into the spotlight, as Theo Albrecht passed away in July. The Albrecht brothers’ invention of the “essentials” discount market in Germany during the 1960s eventually catapulted the humble brothers onto the Forbes 100 list of the world’s richest people, with private assets worth approximately 40 billion euros.

The two brothers transformed their parents’ small grocery store ALDI (an acronym for Albrecht Discount), located in the working town of Essen, into a simple, yet elegant business model. Out of necessity, the store only sold a small number of essential items, but the Albrechts used that to create a brand promise based on the principle of selling the highest quality goods at the lowest prices. The first store opened under the motto, “concentrating on the basics: a limited selection of goods for daily needs.” ALDI’s philosophy on “honest to goodness savings” is the foundation for the brand’s “less is more” approach to grocery retailing, and the resulting shopping experience struck a strong chord with consumers in Germany and eventually around the world (ALDI is also the owner of the Trader Joe’s grocery chain in the United States). The high quality range of goods sold in the store was initially limited to a core selection of goods to be purchased in bulk, sold at affordable prices and presented in a radically simple way. At ALDI, everything from selecting suppliers, building store locations and, of course, selling goods, is done to facilitate significant savings with the “discount” always passed on to customers in the end price.

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Aug 6th, 2010 posted by Rolf Wulfsberg

The economic benefit of simplicity

In a recent speech at New York University’s Stern School of Business, Treasury Secretary Timothy Geithner indicated that a top priority of the overhaul of the financial system “will be simplifying the forms consumers have to get credit cards, auto loans and mortgages.”1 Geithner said that the government “will move as quickly as possible to bring clarity to the new rules of finance.”

Should companies in the financial services industry see these requirements as yet another regulatory hurdle that will cost them money and aggravation or does simplification of communications actually represent a potential for economic benefit? Geithner indicated that the changes would enable consumers to “make better choices, borrow more responsibly and compare costs and services,” but rigorous research at Siegel+Gale reveals the potential for significant business benefits for the lenders as well.

Siegel+Gale’s Simplicity Laboratory rigorously analyzes communications on such pillars of simplicity as comprehension, relevance, clarity, and freshness. Analytical tools such as heat mapping are used to identify specific elements of communication that induce confusion.

But the Simplicity Laboratory goes further. It also measures the extent to which reduction of complexity and confusion leads to economic benefit. A recent test of student loan application forms, for example, revealed that a 12 percent improvement on perceived simplicity of the loan application led to an uptake of a corresponding 12 percent in consumers’ willingness to actually fill out and submit the form for approval.

The economic benefits of simplicity can manifest themselves in many ways. Testing of simplified forms for the Internal Revenue Service has demonstrated that such simplification leads to both increased payment of full amounts owed and reduced numbers of calls into IRS taxpayer service lines. Tests of documents sent to customers by financial institutions revealed that simpler communications were more likely to be read and saved for future reference. In addition, simplified communications significantly improve the relationship between the institution and the customer. Those who receive the less complex documents are more likely to believe the bank values and acts in the best interests of its customers. They are more likely to find the institution to be easy to do business with, and they are more likely to remain with the bank over time.

This discussion is not meant to diminish the frustration that companies must feel with the increasing burden of Federal regulation. It merely hopes to point out that remedying much of the complexity that has led to this regulation may in fact lead to positive outcomes rather than increased cost.

1 Fredrix, Emily and Crutsinger, Martin. “Geithner pledges quick action on new financial law.” Yahoo! News, August 2, 2010

Rolf Wulfsberg is the global director of quantitative research for the Siegel+Gale New York office.

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Aug 5th, 2010 posted by Hayley Berlent

Q+A on the Y brand revitalization

On Monday, July 12, 2010, after two years of partnership with Siegel+Gale, the Y rolled out their revitalized brand, which included a refreshed brand platform, brand architecture and nomenclature strategy, messaging, as well as a new visual system and website.

Since the announcement, online and offline communities have been atwitter about the bold step forward for the Y. From the mainstream press to business blogs to everyday people, like you and me, people have been excitedly inquiring about the strategy, name, logo and more. We thought we’d take this opportunity to answer some of these questions and continue the conversation.

The Y is so well-known, why did it need to revitalize its brand?

It’s true that the Y has nearly universal awareness, but research—the most extensive ever conducted by the Y—shows that few people actually understand the breadth and depth of its impact. In fact, the Y is most commonly associated with swimming and fitness, and not as a nonprofit, cause-driven organization. With more than 2,600 Ys across the nation, the brand revitalization allows Ys—irrespective of location or offerings—to unify around a common brand platform; thereby elevating the nonprofit’s cause and areas of focus. As a result, the Y is now poised to make its impact more widely known.

What is the Y’s cause and areas of focus?

While offerings differ from Y to Y, we discovered that one thing remains shared—a commitment to strengthening the foundations of community through three vital areas of focus: youth development, healthy living and social responsibility.

With a renewed focus on nurturing the potential of children and teens, improving the nation’s health and well-being, and giving back to our neighbors in need, the Y now has a clear framework to communicate the many benefits of its offerings and services it provides to individuals and communities.

Isn’t the logo well recognized? What factors influenced the selection of the refreshed logo and visual identity?

We were keenly aware of the recognition of the Y logo; however, research indicated that the overwhelming perception of the Y was vastly different from the reality of what the Y really stands for and offers its communities. The organization needed a way to signal to the public that they’re not just a provider of services, but the leading nonprofit committed to strengthening community through youth development, healthy living and social responsibility. A logo change—particularly to a logo so well recognized—is one way to challenge misperceptions and get the public to reexamine the benefits of the Y.

Changing the logo was not done without rigor. A lot of time and effort went into developing just the right symbol, and extensive testing of the new logo (and other alternatives) took place before the new design was adopted. The test results were remarkable. The new logo far outperformed the current logo on every attribute examined. This is a highly unusual result as people usually assign higher scores to a design they know versus one they have never seen. This was an important finding that added weight to the ultimate decision.

In addition to testing, we worked with CEOs across the Y to ensure that the logo and visual identity were respectful of the organization’s rich heritage, but also looked to the future. To reflect the past, we retained the triangle, which honors the organization’s mission and has been a consistent element of the Y’s identity throughout its more than 160-year-old history. To look to the future, we infused the logo with multiple colors to reflect the diversity, dynamism and optimism of the Y’s many communities. Additionally, the forward and upward motion of the logo conveys that the Y is mobilizing communities to bring about lasting positive change.

The supporting visual system includes benefit-oriented messages, vibrant colors and a fresh and bold imagery style.

What factors influenced the decision to adopt “the Y” as the communicative name?

If you look at the prior logo of the organization, it was simply a “Y” resting on the letters “YMCA.” After conversations with internal and external audiences, we realized that the name the public affectionately calls the organization is “the Y”—not “Y” or “YMCA.” As an organization committed to strengthening community, it made sense to align the name of the collective organization with what the community calls it. However, despite media reports, the “YMCA” is not going away and will continue to be used as part of the formal name of locations, branches and camps. The use of a communicative name and a formal and/or legal name is a common practice that is used by organizations ranging from HBO (Home Box Office Inc.) to Deloitte (Deloitte Touche Tomatsu).

Hayley Berlent is a senior strategist for the Siegel+Gale New York office.

Contributors to this article include: Rolf Wulfsberg, Nancy Hansell, Doug Sellers, Michelle Matthews, Lana Roulhac and Colleen Delaney

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Jul 30th, 2010 posted by Brian Rafferty

Building a brand through shaving a head

Having an aged and high maintenance cat as a pet, my wife and I frequently end up at Petco. I have always had rather poor perceptions of Petco as a retail brand: my daughter likes looking at the goldfish but that does not compensate for lackluster experiences with typically disengaged sales and delivery staff. These perceptions changed recently and it was all related to one thing: our local Petco manager promising to shave his head.

I know this is probably puzzling, so let me explain. As we were checking out with our usual array of cat food and litter a few Sundays ago, the Petco sales clerk appeared unusually eager to hear about our experience. He asked if everything was okay, if there was anything else that we needed and if there was any way he could be of more help.

Hearing we didn’t need anything further, he then solicited our participation in an online customer satisfaction survey Petco was conducting. He told us excitedly that it was really important that we participate, as their store manager had promised to shave his head if the survey reached 1,000 completes. The entire staff was hard at work driving participation with this in mind. No doubt, the end goal was to obtain valuable customer feedback the brand could use to improve the customer experience. But what struck me was the genuine interest the sales clerk had in encouraging people to fill out the survey. It was as if he was motivated by something more, a greater sense of purpose perhaps.

While most people know that Petco is “Where the pets go,” I think one could argue that employees feel a deeper commitment to its customers—the pet owners. Aside from its tagline, Petco describes itself as “a privately held specialty retailer that provides products and services that make it easier for customers to be great pet parents.”

Further looking at this head shave from a brand standpoint, I believe it offers many lessons as to the impact and importance of storytelling and leadership engagement.

One: Engaging employees

By making this promise, the manager really focused his employees on multiple goals. First, he got the employees to promote the survey with customers. Second, he also got them focused on the underlying objective of the survey: to increase customer satisfaction

Two: Engaging customers

The promise of the head shave does more than just serve as a humorous market research incentive for customers (which is no mean feat itself; it beats and is cheaper than the typical iPod drawing). It creates a story that gives customers a much richer perception of Petco: as a brand where the store manager cares, where he is willing to put his own follicles on the line. It changed my perception of Petco from an unfriendly necessity to a place that seems much more involved with the community, a differentiating and hard to achieve attribute for a retail brand in this age of mega-stores. After all, it worked for me and my family, as we chuckled remembering the story from the sales clerk, while completing the survey at home.

The head shave has also created a story, one that I repeat, per this article, that contributes to reinforcing perceptions of Petco as a brand that truly cares about your pets and your ability to be the best pet parents.

This doesn’t mean all brands should immediately instruct their managers to shave their heads (certainly no one would get very excited about that promise coming from me given my follically-challenged pate). Rather, it speaks to the power of creating stories and of management and employees who are personally engaged with and committed to a brand. The first step to getting there is an articulated and unified sense of purpose; the stories invariably follow.

Brian Rafferty is the global director, Customer Insights for the Siegel+Gale New York office.

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Jul 29th, 2010 posted by Piers Guilar

Social Network Suicide

Had enough of life online? Whilst there are over 500 million active users of Facebook alone, a growing proportion of consumers are completely removing themselves from social networking sites. They are concerned that all this time ‘living’ online is posing a threat to their offline, real lives. Many argue, for instance, that the information online reveals too much to current and even future employers. Others claim the time spent building a virtual life takes away from the traditional relationship-building that occurs face-to-face. People are committing online suicide with the help of companies such as Seppukoo, (a form of Japanese ritual suicide, actually spelled seppuku), which helps users delete their Facebook profiles and the Web 2.0 Suicide Machine, which helps you “completely do away with your Web 2.0 alterego” by deleting all of your social networking profiles.

Initially, Facebook fought these companies offering assisted suicide, even going so far as to send cease and desist letters in late 2009 and into 2010.

Not surprisingly, Seppukoo responded with its own letter to Facebook stating that it would not comply. Despite the fact that there has been little to no activity on the Seppukoo website as of late, Facebook continues to grapple with ways to satisfy members’ privacy concerns.

You may recall that in May the organization announced the introduction of simpler and more powerful controls for sharing personal information.

These efforts, in combination with Facebook’s recent milestone, seem to suggest that the nearly 1.1 million social suicides claimed by the Web 2.0 Suicide Machine and Seppukoo were not enough to thwart the organization’s influence on people and brands all over the world.

So what’s next for the network? In a recent article by The Guardian, Gartner analyst, Monica Basso, deems Facebook “the mother of all social networks.” Basso goes on to say that, “By 2012, Facebook will become the hub for integration of social networks, as well as for social extensions of traditional websites and applications. Other social networks, including Twitter, will continue to develop, seeking further adoption and specialisations with communication or content areas, but Facebook will represent a common denominator for all of them.”

Do you agree with Ms. Basso, or does the mere thought of a more dominant Facebook indulge your social suicide?

Piers Guilar is a group director for the Siegle+Gale London office.

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Jul 26th, 2010 posted by Christine Mauro

Brand-building through effective cross-channel communications strategies

It was the perfect storm of poor communications as I sat in the airport waiting for my flight which had been delayed due to weather. At any given moment, I received information from at least five different sources: text alerts, the flight status board, verbal announcements, the airline website and other passengers waiting for the flight.

None of these communication channels provided the same information.

This made it impossible to determine what information was accurate or most up-to-date. After two hours of waiting, the board posted “CANCELLED,” with no verbal confirmation or direction as to what steps to take next. Frustrated by the long line to speak to an agent, I turned to the airline website which directed me to call a customer service agent, which then resulted in a 10-minute wait on hold.

In today’s digital world, customers expect accurate updates in real time. It’s considered a failed customer experience when that doesn’t happen. Companies need to have a cross-channel strategy with the technology in place to support it. As a result, customers will be satisfied with timely and accurate data when a problem arises.

Because most customers have a channel preference for receiving information, it’s important to provide various options for accessing information. Today customers can choose to receive information via e-mail and online message boards—and many keep themselves informed with text alerts sent to their mobile devices. Still, some customers prefer the person-to-person interaction with customer service representatives. While it is important to provide a variety of channels to consume information, ensuring that all communication is aligned and that each channel is equipped to handle distribution is critical. The information posted to an online message board should be the same information communicated by employees both in-person and at call centers. Additionally, if an organization is driving customers to the call center from the web, the call centers should have the bandwidth to take on the volume of inbound calls along with the right information to resolve customer issues.

Taking this a step further, VIP customers or those participating in loyalty programs may expect special treatment, such as a dedicated phone number or expert agent for “members only.” Although all customers are valued—and it’s important to provide the best customer service—rewarding customers for their loyalty can be extremely beneficial.

So while many companies are concentrating on cross-channel marketing, maybe the big picture strategy should address how to consistently deliver on the brand promise even in the midst of a crisis. Organizations may build better relationships with customers when they most effectively deal with their problems through clear and consistent communications rather than selling them more “stuff.”

Christine Mauro is a strategy director in simplification for the Siegel+Gale New York office.

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Jul 22nd, 2010 posted by Miles Seiden

Design technique battle royale: Snap-to-Point vs. Smart Guides

Often, during a creative project, two or more shapes must be aligned to each other—not just to the same side, but literally touching in such a way that their edges form a seamless perfection, interlocking like two gears working in synergistic unison. There are a number of techniques out there to achieve such alignment, but for all intents and purposes, dead-on alignment accuracy is a two-party system.

It’s time for a showdown, folks. Snap-to-Point versus Smart Guides.

Welcome to the Adobe® Illustrator® arena, where much of the action takes place. In one corner, we have Snap-to-Point, the long-favored method whereby each corner or center point of a shape can be aligned to the corner points of another shape. It’s simple, no-nonsense, tried-and-true accuracy.

Our challenger, Smart Guides, is a newer method involving orthogonal path and point alignment options. It uses text labels to indicate intersecting moments among shapes, and offers feature customization through the Preferences panel.

Inspired by the passionate Snap-to-Point evangelism of Siegel+Gale Los Angeles Creative Director Matthias Mencke, I asked the creative experts at the firm to duke it out in a no-hold-barred MDT (mixed design techniques) survey. Over the next two weeks the results poured in and a heated battle ensued—both sides highlighting the pros and cons of their favorite techniques. Rationales for choosing one technique over another were explained by providing web links to outside sources, personal anecdotes, philosophical explanations and even tongue-in-cheek opinions. The major rationales (and a few humorous jabs and hooks) appeared as follows:

Snap-to-Point

  • Pros
    • Signifies exactitude through the ’snap movement’
    • Provides more security
    • Creates better precision
    • Affords freer movement at the beginning of design exploration
    • Supports the creation of effective web templates
    • Has a catchy name
  • Cons
    • Does not facilitate path snapping
    • Has a limited scope of alignment options

Smart Guides

  • Pros
    • Matches elements to a curve effectively
    • Displays guides only after they’ve been aligned
    • Exemplifies the first law of simplicity—thoughtful reduction
    • Aligns with the Siegel+Gale credo and culture which calls for smart
    • Finalizes designs according to stricter grids
  • Cons
    • Appear sloppy and imprecise
    • Force undesired alignments among objects
    • Require too much zooming for accuracy checks

In the end, the survey results suggested that people would prefer a technique that combined the best attributes of both tools rather than one all by itself. If forced to choose only one, however, the Snap-to-Point contender prevailed. By using both and allowing these methods to dictate alignment, there would be more time to focus on the actual design. On the other hand, some preferred not to use either technique—citing the possibility of being forced to work within a particular set of alignment paramaters as reason to use another technique.

Overall it seemed like the creatives polled enjoyed the flexibility available to them by using both techniques, but sought simplicity when it came to choosing one technique over the other.

Miles Seiden is a designer for the Siegel+Gale Los Angeles office.

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Jul 20th, 2010 posted by Jillian Mascarenhas

Driving a positive customer experience across touch points

With the vast world of social media giving anyone with a keyboard and an Internet connection the power to influence perceptions, you’d think that companies would align more resources to customer service. Having seen how organizations like Delta (@DeltaAssist), Comcast (@ComcastCares) and Firefox (@Firefox_answers) use Twitter to respond quickly to customers who need help, it seemed natural to assume that other companies would follow suit and do whatever it takes to meet (reasonable) requests from customers.

I learned the hard way that this is not always the case.

Over the last few months I’ve used a particular car rental agency when traveling for business. I’d had a good experience with the brand’s online reservation system, pickup and drop off locations, as well as its loyalty program, which allowed me to earn points for my frequent flier account. From a brand perspective, the company seemed to create a rather pleasant and consistent customer experience at multiple touch points.

So, when a personal trip came up, it made sense to stick with what had worked for me before, and rent a car from the same company. But, as soon as I saw the serviceman pull the car up at the rental agency I realized that despite all the aforementioned ways the brand had met my needs, the one place it failed to deliver was in the quality of its primary product—the rental car. The car, which was not the class I had specified, was completely covered outside in pollen, mud, and bird droppings, and inside with crumbs and dirt. Plus, the upholstery was littered with multiple stains, not to mention the sticky streaks in the cup compartment.

I was aghast at the complete lack of quality and, after taking a few pictures, contacted the company to voice my frustration. Adding to my disappointment, however, not a single customer service representative contacted me to try to salvage my now sullied experience. While I have yet to receive a direct response to my email, the company did send an automated link to a “Rate Your Experience” survey 36 hours after returning the car. In the day-and-a-half that it took to receive the “Rate Your Experience” survey, I could have just as easily tweeted my frustrations to thousands of potential customers. That said, I’d like to take this opportunity to remind brands that the experience they deliver should be consistent across every facet of the organization. Every interaction the customer has is an opportunity to connect, engage and build brand loyalty. When the experience differs from one touch point to another (i.e., point of purchase, customer communications, customer call centers, etc.) brands lose out on the chance to build lasting relationships with some of their most influential stakeholders.

Jillian Mascarenhas is a strategist for the Siegel+Gale New York office.

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Jul 19th, 2010 posted by Eric Lin

Raising the bar for China’s retail market

As a recent Apple convert, I was thrilled to hear about the new flagship Apple store in Shanghai—the first in the city and only the second in mainland China (the first opened in Beijing in 2008). Shrouded in secrecy for months, Asia’s largest Apple store is an impressive sight: a beautiful 40-foot glass tower welcomes visitors down into a 1,500 square meters store where they directly interact with an extensive selection of Macs, iPods and iPhones (though the new iPhone 4 is noticeably absent). Over 175 blue t-shirt clad Apple employees roam the vast space and answer questions at the world’s largest Genius Bar. On opening day, thousands of Apple enthusiasts and the just-plain-curious lined the plaza to await their chance to see this sight for themselves.

Just a few weeks earlier across town, iconic guitar-manufacturer Gibson had opened a flagship store of its own—its first location outside of the U.S. and only its third total. Though hundreds of its iconic Gibson guitars hang for sale on the walls, this store aims to sell an experience and serve as a creative hub as much as it intends to sell instruments. The location features a live-music stage that will showcase local guitar enthusiasts, product demos and jam sessions, as well as a bar—all designed to create an immersive, authentic Gibson experience that creates affinity for the brand.

Though the opening of an Apple or Gibson store might not be newsworthy in other markets these days, these recent Shanghai openings are an important step not just for the companies and their growth plans here, but also for the advancement of immersive, engaging brand experiences in China’s retail market. This market, which has surged in lockstep with increased consumer buying power, is too often undifferentiated and uninteresting. Product offerings seem indistinguishable from one store to the next, cookie-cutter store designs pay little attention to actual customer needs and buying behaviors, and poorly trained employees offer little reason, excitement or motivation for you to buy their products.

The hope is that brands like Apple and Gibson raise the bar for China’s retail experiences. Though retailers need not hire an architectural firm to design a towering glass entrance or turn every store into a “creative hub,” the fact is the store environment is the lifeblood for their brand and unmatched in its ability to present their brand in the way it is meant to be experienced. Both Apple and Gibson demonstrate how thoughtful physical expressions of their brand promise, differentiated product offerings and an inspired staff of brand evangelists can shape experiences that create lasting customer relationships.

Eric Lin is the general manager for the Siegel+Gale Shanghai office.

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Jul 16th, 2010 posted by Matthew Huss

Introducing branding’s surprising new best friend: the recession

We may be officially out of the recession, but it’s probably safe to say that the impact on corporate America is still being seen and felt. Companies continue to scrutinize their spending and are only slowly beginning to hire again in meaningful numbers. For those of us in the world of branding, the recession appears to have resulted in an interesting phenomenon. The length and severity of the “belt-tightening” over the last two years seems to have caused a noticeable shift in how companies approach brand-building.

Now more than ever, companies are avoiding splashy brand launch programs. They don’t want to seem insensitive to their employees by spending on lavish, loud announcements and rollouts—especially when they’ve perhaps let some of their staff go recently. Instead, they are focused on looking inside and “operationalizing” their brands—really driving them through their organizations. They’re thinking about how they can leverage their brand to engage their workforce. More and more companies, for example, are excited about tapping into their brand as a means for conducting more effective performance evaluations or driving smarter recruiting strategies.

This is good news for the reputation and business of corporate branding. Branding has long been synonymous with marketing communications. But the recession has helped reinforce and maybe even elevate the role and importance of brand-building as a filter for helping an organization attract and retain good people.

Matthew Huss is a senior strategist for the Siegel+Gale New York office.

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