Three big brands made headlines last week. One lost a leader, another gained one and the third is hopefully about to realise it needs to bring one back. Despite these contrasts, all three stories serve to illustrate one of the great lost messages of branding – the power of founders.
First to Cupertino in California, where Steve Jobs finally ceded that his precarious personal health meant that he could no longer lead his beloved Apple. While there were no public announcements about Jobs’ long-term plans, this time there will be no triumphant return to the stage. Apple will continue to benefit from his sage advice from the sidelines, but the founder has left the building for good. And it’s only if you really understand brands that you can appreciate how significant this loss is for Apple.
In the two millennia since the first Viking blacksmith burned his mark onto his wares, very little has changed in the dynamics of branding. For there to be a brand of any strength, there is almost always a founder. One feeds the other in an almost biological relationship.
Because they have the brand in their bones, when a founder runs their own brand it can confer astonishing strategic advantages. Time and again, they instinctively and instantly make the right decisions. Founders also enjoy an almost preternatural gift for seeing the future and the place that their brand should adopt within it. They also often lead their organisations with the kind of vigour and charisma guaranteed to build the employer brand. And perhaps best of all, they are a walking brand-centric source of free marketing communications.
The most powerful form of marketing communication occurs when a founder talks about their business. Suddenly consumers listen. Even more amazing, they believe.
Such is their power, that when the founder finally departs, dies or retires many brands struggle to retain their trajectory. A fact reflected in the 6% drop in Apple’s share price since the news of Jobs’ departure was announced.
All is not lost, however. There are many cases where a founder returns to their failing brand and resurrects it. Steve Jobs did it against all the odds in 1997, Gabrielle “Coco” Chanel did it in 1963 and at the age of 70 and more recently Howard Schultz waltzed back into a seemingly doomed Starbucks and took less than a year to turn around the brand that he first built two decades earlier.
I could spend the rest of my life teaching brand management (and I probably will) and still never be able to distil and communicate the fundamental contribution that founders make to their brands. Fortunately for me, five days later and five miles up the road from Apple’s HQ, the next big case study of founder-based magic was already taking form.
Late last week Google shocked the markets by announcing that the ten-year reign of chief executive Eric Schmidt would end in April. Schmidt will step aside and allow Larry Page, one of Google’s co-founders, to replace him. Schmidt has proved to be a safe pair of hands but there have been whispers for some time that Google needed to return to the hands that formed it.
First were the recurring rumours that both Page and co-founder Sergey Brin were uncomfortable with Google’s commercially savvy but brand inconsistent decision to alter search results in accordance with the requests of the Chinese government. There was also increasing alarm at Google’s inability to monetise anything other than search advertising and a growing frustration born from competing with faster, founder-run brands like Apple and Facebook. Finally, if Newsweek is to be believed, Google was beginning to lose the war for talent as many of its best engineers left the company for sexier destinations. The promotion of Page could, if you believe in the myth of founders, fix all these ailments and then some.
That’s why I am also hoping that Pret a Manger is smart enough to elevate either Sinclair Beecham or Julian Metcalfe to the front ranks again as it approaches its 25th anniversary. Pret is enjoying booming business results, but the brand is said to be struggling to remove its association with McDonald’s, which acquired and then divested a 33% share in the company a few years ago.
If Lewis PR, Pret’s newly appointed agency, know their branding onions they will ask the two founders to step out of the shadows and remind their customers about the brand they built and its current independent status. Customers may be bored with advertising, aspirational brands, positioning strategies and the rest. But when you ask two friends to talk about how they met and went on to build one of the great post-war British brands, people will stop in their tracks and listen.
The power of founders is the reason why Starbucks is now on track to break all business expectations, Chanel will live forever, Google will prosper in 2011 and Apple will miss Steve so very, very much.