Chapter 10. Insights-Led Brand Building in Technology

• How can technology companies build an emotional component into their brands?

• How can technology companies work with the insights process?

• How can global technology businesses harness global insights to build global brands?

Some categories and brands do not have a tradition of building emotional connections with their users. As a result, they have not unleashed the full power of insights to sustain the customer engagement and loyalty that provide long-term, reliable cash streams. Although consumer packaged-goods companies such as Procter & Gamble and Brown-Forman are well versed in how to connect emotionally with consumers, large technology companies are not. A great technology brand such as Microsoft may have good brand recognition but not necessarily the deep emotional loyalty that brands in other categories have developed over years of careful cultivation.

When a technology company tries to build a brand “from scratch,” it has an opportunity to overcome the historical absence of emotion-based brand building by introducing an insights-led process from the outset. We will illustrate this point with a case history of Windows Live. Peter Boland, as the former Global Brand Director for Microsoft’s Windows Live brand, utilized the customer insights process to build a new brand loyalty among consumers who know Microsoft but who might not yet feel an emotional connection to the brand.

Microsoft was founded in 1975 and was one of the most successful growth companies through the 1990s. Today, financial markets perceive Microsoft as owning mature brands (such as Windows and MSN), many of which operate in slow-growth categories.

There’s a saying in marketing that there are no mature brands, just old thinking. As Mark McCallum pointed out, any brand can be reinvigorated—its equity can be monetized in emerging new growth areas. The limiting factor is whether an acceptable return can be made on the investment in doing so.

One of Microsoft’s most powerful and well-known brands is Windows. Its successive relaunches as Windows 2000, Windows XP, and, most recently, Windows Vista, are front-page global news events. Windows has a huge share of its category and has enjoyed a long and fruitful relationship with millions of customers. Yet, even a juggernaut brand like Windows must face transitions of a magnitude that require significant marketing-led change.

The latest big change for Windows is the shift to a hybrid online-offline model. Although software loaded onto the hard drive of customers’ computers is still a huge business, customers want to access some services online. Sometimes, their need for access is “all-online,” such as when they are mobile and need computing services via their cell phone or wireless laptops. Other times, they may need both online and offline capabilities simultaneously. For example, they might want to use the power of the Windows operating system on their hard drive while also accessing an online service such as web e-mail, instant messaging, or search.

The Windows answer is a brand extension called Windows Live. The “Live” suffix is attached to a number of Microsoft offerings, including Xbox Live and Office Live. It connotes a new level of connectivity—online access to Internet services. Windows Live is a platform for consumer online services including web e-mail, Instant Messenger, search, and safety tools. Microsoft knows from extensive research that, for many consumers, Internet tools such as these have become essential for managing their busy lives. Millions of consumers around the world spend many hours a day on the Internet. It’s an essential part of their work life, and often their home or social life. For younger consumers especially, the online and “offline” worlds are seamless. They switch effortlessly from updating their MySpace page to sending text messages and doing research for school.

Windows Live is a promise by Microsoft to make these consumers’ lives easier and more fruitful. Most know how to use the tools available to them. They may not be tech-savvy, but they’re familiar enough with what they use. However, Internet services are a fragmented experience. Users often must sign in to one service, sign out, and sign in to another service as they navigate through their different service choices. As a result, consumers tend to take an a la carte approach to their favorite products. They use multiple brands of Internet services as opposed to building a relationship with one brand that can take them wherever they want to go on the web.

Windows Live offers the functional benefit of signing in once so that all of the customers’ Internet services needs can be fulfilled without signing in and out multiple times. All their files can be accessed and shared quickly on a laptop, digital camera, and phone. The same is true for their professional and personal contacts, which can be continuously updated and integrated on all modalities.

However, these are functional benefits, and brands must have an emotional connection to their customers to sustain loyalty, premium pricing, and growth. As Mark McCallum stated in the offline world of Jack Daniel’s^®, “If your brand relevance is based on an emotional benefit, then you can thrive for generations, but if it’s a functional benefit, you are only as good as the next invention.” In the case of Windows Live, the “next invention” may be fabulous Internet services capabilities that provide customers with unprecedented flexibility and access to what’s important to them; nevertheless, it’s still a functional benefit.

We asked Peter Boland (now Global Brand Director for iShares at Barclays Global Investors) to speak with us about the challenges of capturing emotional equities with the Windows Live brand. We asked him about applying the insights-generation process to building brand equity with a consumer-centric view in Microsoft, a company that (like most technology companies) has traditionally had a product-centric orientation.

Peter Boland

Pete began his marketing apprenticeship at P&G, mastering the classic best practices of packaged-goods marketing in a rigorous and competitive context. He applied much of what he learned in international markets of varying sizes and development.

He transitioned from packaged goods to financial services with Visa International, where he expanded his global view and country-by-country channel and partner management experience, as well as immersing himself in another consumer category. He also worked in consulting, giving him the opportunity to objectively observe and advise on the application of marketing in fields ranging from server-based computing to manufacturing supply chains. At Microsoft, Pete helped create a great brand in a field noted less for its great branding work than for its technology feature wars.

Leading with Insights Is a Difficult Challenge for Technology Companies

Pete sees three reasons why technology companies have not historically built strong emotionally anchored brands founded on consumer and customer insights into the way that Mike Keyes and Mark McCallum described for Jack Daniel’s:

• Technology companies just don’t have an embedded heritage to synthesize and leverage consumer insights that drive businesses. So they tend to miss the opportunity for insights-led brand building.

“Although technologists have a difficult time with cross-category comparisons from software to consumer goods, I still think it can be instructive to take lessons from industry best practices and find the bridge to your own category. A great example is P&G’s Bounty paper towels brand. The product is based on an engineering-created breakthrough (superb liquid absorbency performance). But what makes this engineering resonate is the brand’s emotion-based consumer insight. Essentially, Bounty can contribute to a better relationship between a parent and child, obviously a highly desirable emotional benefit. When the child makes a spill, Bounty is strong enough to clean it up without fuss, so it’s not a disaster. The relationship is not affected, and you’re not mad at your kids. Bounty is the hero for delivering this benefit, and parents trust the brand to do so and therefore stay loyal. I’ve always thought this is a simple and striking example of taking a universal, meaningful insight about parenting and channeling it specifically to a product. The lesson for technology marketers in this example is that technological benefits must be articulated in the emotional context consumers understand. I know this sounds obvious, but for tech companies it’s not so apparent. We tend to believe consumers love our technology rather than the benefit that accrues from it. This tendency manifests itself in naming architectures that are confusing and complex, and consumer advertising and messaging that’s at best me-too, and at worst cold and cluttered. So in the Bounty case, consumer insight is the core of the brand story. But in technology-led companies, there’s just little history of consumer insight being at the front end of the brand-building process.”

• The industry has always been led by its engineers, not its marketers.

“My company, Microsoft, has the most talented engineers you will ever meet. They’ve been engineers throughout their schooling and their work experience, and they approach product management and product development from a scientific, engineering-based point of view. Obviously they get really excited about technical capabilities, and that’s one reason why Microsoft technology is so absolutely brilliant. Having said that, it’s hard for a company with this kind of engineering focus to take a consumer-first point of view. It’s very difficult for them to have the mind-set of your average consumer, be it a grandmother in Frankfurt or a small-business owner in New Delhi or Buenos Aires. In my experience the engineers rarely appreciate the crowding-out effect that the bombardment of information has on the mind of consumers. I think they believe all consumers have time to consider their product and associated messaging in detail. Everything I hear from consumers—and I’ve probably listened to at least 400 over the past two years in focus groups and one-on-one discussions—is related to the desire for simplicity in their lives. Engineers and product marketers must be able to look at a brilliant cluster of technological features and think, ‘I’m not sure if my friends or my mother would have any clue how to actually operate that.’ That’s not the case for engineers who live in a techno-centric world.”

• Technology-centered companies tend to make it even more difficult for themselves to navigate via consumer insights because they don’t have the same input materials as a marketing-centered company. They structure their market research to focus on technology performance data or statistical support for technology benefits.

“Technology companies drill down into the data about product usage, but not into its benefits. Generally they don’t step back from the technology and ask the consumer, ‘What does this feature do for you? How does it make you feel? How does it change your life?’ These are the crucial questions. Engineers can advance along the product development chain with no benefit-based consumer insight at all, and especially without understanding emotionally based benefits.

“The risk is that such a process will miss the point of the emotional benefit that transcends utility—and generates love, loyalty, and premium pricing. A brand built in this environment can only be functional—and purely functional brands are not the way to become a brand leader in most categories.

“Fortunately for the company, this is becoming less and less the case at Microsoft. There’s been a real shift in appreciation of the value of consumer insights. The marketers in the Windows Live group are highly aware that, as a challenger brand to entrenched winners in Internet services, such as Google, AOL, and Yahoo!, we really have to demonstrate our understanding of consumers and show them we’re on their side. To do so successfully, we truly need to understand what being on their side really means, and that requires the insights that support such a deep level of understanding. You’ll see in our communications that we’re getting better. We have the right mind-set.”

Can Technology Brands Have an Emotional Component?

Is it possible for technology companies to build emotional bonds with their consumers based on insights? Google answers that question. People love Google. Consumers are engaged, but not through advertising. Google has built real brand equity.

Brand equity is built on three activity streams: innovation, design, and the consumer experience. Google has succeeded in each of these activities.

• Innovation: Google has superior performance in search accuracy, as proven in performance tests.

• Design: Google has an extremely simple and easy-to-use interface. Design is the component that makes a brand relevant—that is, “right for me.”

• Consumer experience: Google has a highly developed and fairly unique consumer engagement component. Every search query a customer enters is both a declaration of intent (telling Google what she needs and confessing that she can’t meet that need without Google) and a plea for help. There’s a functional benefit in meeting this need; it’s called “adaptive memory.” In other words, you don’t have to remember things if you know that Google will find everything for you. There is a clear emotional connection with Google. Google makes you feel competent without judging you.

So, Google has all the attributes of a strong brand—a promise to consumers, a functional benefit, an emotional benefit, reasons to believe it can deliver the benefit that are confirmed with every search, a consistent and excellent consumer experience, plus style and character. All of these elements are infused throughout the brand experience and reinforced at every touch point.

We’ve referred to Apple as another brand owner in the technology space that understands brand building. The Apple organization is congruent. Its employees understand the tone and style for the Apple brand. It recognizes that consumers receive an emotional benefit through the self-expression that Apple enables.

Consistent with this trend toward better brand building in the consumer software category, Pete Boland and his team helped lead Microsoft toward an improved brand-building future. He initiated the consumer insights generation process and focused the organization on the value chain to enhance consumer loyalty to Microsoft.

“Google and Apple are exceptions. Yahoo! may be another. But most technology companies, and I’d include the ‘old’ Microsoft in that group, do not have a history of a unified brand point of view or a history of building a brand that relays some sort of human emotional truth. Many engineers presume consumers are like them on the technology adoption curve; the engineers could benefit from the holistic insights generated to reach the target customer, and they need to learn how emotional connection adds value.

“By simply introducing the primacy of consumer insights in our development of the Windows Live brand, we have been able to make a lot of progress from this past.”

New Insights for the Windows Live Brand of Internet Services

Simply initiating new learning can lead to a torrent of downstream marketing innovations.

“Our starting point was to conduct new consumer research and ethnography focusing on the benefits of Internet services to consumers. We were absolutely delighted with what we were able to reveal about consumer emotional involvement with Internet services. In the past we hadn’t dug really deep enough to unearth emotional benefits; we’d tended to be satisfied with functional benefits such as ‘It helps me get things done.’ For Windows Live we deliberately dug deeper, using consumer-generated imagery to tell the story of the role of the Internet in people’s lives. We uncovered three fundamental benefits of using the Internet. The three included the benefit of deepened relationships, enriched knowledge, and self-esteem.

“For example, the benefit of using e-mail and Instant Messenger is deeply emotional. It serves the fundamental human need to create and deepen relationships with family, friends, and strangers. It’s absolutely seminal. The key learning for us centered on the role of e-mail and IM in eliciting deeper, more meaningful dialogue than face-to-face human contact usually has. That was new news to us. Consumers told us that they reveal their inner thoughts much more readily on e-mail, and especially on Instant Messenger, than any other media. Although that’s a category benefit rather than a brand benefit, if our new brand does a better job than others in understanding and communicating that benefit, then we can begin to form our own emotional foundation for our brand’s equity.

“Other Windows Live offerings have a similarly profound impact on consumers’ lives, leading us to the realization that the brand could truly bolster consumers’ self-esteem and confidence based on what quick, deep access to knowledge, and new, deeper relationships, can do for their careers and their personal life. It’s inspiring to people. We were quickly able to uncover all this emotion that we could to tap into in order to differentiate Windows Live Services.”

Using Insights to Create New Economic Value

Here’s how Pete describes the new value that new insights can generate for a well-established brand like Windows from Microsoft:

“Mark McCallum from Brown-Forman talked about brand renovation and gave a superb overview of what’s entailed. I use the term ‘reignite’ for the brand-building activities we’ve tackled in expanding the user value of the Windows brand to include Internet services here at Microsoft.

“Brand Evaluator studies show that the Windows brand is unrivaled in terms of brand relevance scores—far better than Google or any other category brand comparison. However, perception of the Windows brand has been fairly narrow; it is what users see when they switch their laptop on and off. Beyond that, broad brand knowledge is actually pretty limited.

“That’s because Windows is an operating system that works in the background. Consumers don’t think too hard or too deeply about it. There’s not a great deal of emotional connection. Our task is to reignite the brand, in terms of driving deeper emotional connection, by stretching it into the Internet services space. We have only to rub a little of the Internet magic over the Windows brand, and it reignites.

“There are several very positive factors. While people are aware of the Windows brand, they do not know all of its product offerings, because it has been perceived in a very limited way. Once we dug deep enough to get a full understanding of the relevance of our brand, we uncovered very important attributes that the Windows brand stands for, including quality and genuineness. What was exciting is the potential strength consumers see in Windows’ ability to make my PC and Internet applications work together seamlessly. It gets credit for that from consumers. But the rest of it is totally black space.

“We had to find a way to associate Windows with the new excitement and dynamic innovation of the Internet and to carefully and convincingly draw a new connection. We needed a deeper insight.”

The Insight for Windows Live

An insight is a profound discovery about the motivations that drive human behavior. The job of marketing is to change what customers do (behavior) by changing how they think (attitudes). So, first we have to identify the behavior we want to change and then identify the attitude (or emotion, or motivation) that drives the behavior. Only then can we take intelligent action through marketing or product development.

For Windows Live, the core insight was built around observing fragmented consumer behavior. They use multiple services, often from multiple brands of service providers, and they act in an ad hoc, uncoordinated, unintegrated fashion. They experience the Internet as a cluster of component services. But the problem is that consumers often perceive that different applications do not work together, and users get a fragmented experience. They must do a lot of work on their own to navigate among different programs to try to make them all work together effectively.

Pete suggests that the act of identifying the insight unleashes the solution.

“With that behavioral insight, the Windows Live brand is able to respond to the user’s need—and can do so uniquely—i.e., our brand is better qualified than any other—to build a service that makes everything on the Internet work together.

“The brand communications campaign builds on the functional benefit to reach for the higher-level emotional benefit: if all of the consumers’ Internet services are working together as one, they will feel as though their whole world is working together. This feeling transcends the digital world. It is also about the way people can now interface with their professional and personal world as well. If you can make my Internet world come together, then I feel like the personal world I live in comes together. I feel confident and in control; I’m an achiever. Only Windows Live can deliver this benefit.”

Using the Insights Process

Marketers can create opportunities for growth by first achieving a better understanding of their consumers than any competitor. Ask, “What do you understand about your consumers’ needs that your competitors do not?”

Pete proved that this approach works for technology brands and services.

“That’s how you win! In the consumer packaged-goods category, companies such as P&G find the unique marketing and messaging opportunities they are looking for in the emotional drivers of human behavior. We in the tech world have to learn to do the same.

“So, in our qualitative research to develop insights for Windows Live, we talked to consumers about their experience with the Internet, and we used imagery and analogy to get them to tell us how they feel about the benefits they receive from using the Internet. We explored how the Internet really enriches and changes people’s lives. We didn’t ask about the technology or how to use it; we just talked about what benefits they derived from the technology.

“When you use e-mail or Instant Messenger, what are you using it for? Who are you talking to? How does that change your life? How does that make you feel?”

Insights can cascade from high-level perspectives that can govern the development of major brands at a holistic level to detailed, localized, or product- and feature-specific perspectives for design, development, and differentiation.

“For example, another insight at a greater level of detail that we’ve identified is around the change in behavior that happens to people when they are using Instant Messenger or electronic communication. This new digital kind of communication is qualitatively different from traditional interpersonal communications like talking on the phone or talking face to face, and results in different behaviors. Consumers feel as though they can let their guard down and take some interpersonal communications risks they wouldn’t normally take. As a result, many people who use these communications forms feel sufficiently liberated by the medium to communicate some things that they couldn’t communicate before—like telling their mother that they had sex for the first time, as one respondent told us. The new permission that this form of electronic communication brings with it is something that’s not inherent in features or technology, but is an abstract benefit that arises spontaneously from the medium.”

Microsoft uses internal marketing, as shown in these pages from the Windows Live Brand Strategy book, to communicate the new insights about emotional benefits of software and Internet services (see Figure 10.1).

Figure 10.1. Microsoft internal marketing.

From Microsoft internal brand book. Reproduced with permission.

Global Insights Drive Global Brands

A current debate in our global economy with global marketing is: Can there be truly global positioning, global solutions, and global brands? One simple approach is to ascertain whether there is a global insight. Suppose the definition of an insight is a deep understanding of target consumers and their behavior and the motivations behind that behavior. If you can identify an insight that applies globally, you can build a value proposition and a brand framework that apply globally. Mike Keyes, Global Managing Director for Jack Daniel’s, suggests that the need to express individual independence through the choice of Jack Daniel’s is one such global insight.

Peter Boland, who is a global marketer with experience in multiple industries, discusses this issue for Windows Live.

“On every continent we heard exactly the same thing. We heard consumers tell stories about how they were seeking to better their lives in every way they could. It’s the universal human goal. And those consumers whom we might think of as the most Internet-savvy are using the Internet as a primary tool to achieve that universal human goal. Somebody we talked to in Madrid would tell us the same story we heard in Shanghai, London, and Los Angeles. The emotional intensity that people felt about the Internet is unlike anything I’ve ever worked on. It’s transcendent. People talked about it being an open door to the world. Not so much about the product, but a state of being. It really was incredible—and truly global.

“So the end benefit of Internet services is what we call an enriched life and a unified world—your life enriched by deeper relationships and interpersonal confidence. That’s an emotional benefit, based on a global emotional insight.”

Summary

The power of the insights-centered approach to building brands and businesses is universal. It may have developed originally in consumer packaged goods, but its application is by no means restricted to that industry. It is the “source code” (to borrow a technology term) for understanding customers and creating strong, lasting bonds between customers and the products and services that meet their needs. Good outcomes cascade from the generation and adoption of customer insights. Customer loyalty shifts in favor of the business that demonstrates understanding, enabling the business to sustain premium prices, higher margins, and expanded lifetime values. Similarly, internal corporate behaviors shift as more energy is devoted to listening and understanding and to generating benefits as well as building features. This can be equally true in technology businesses as in more traditional consumer-goods categories. It’s just as true in business-to-business as in business-to-consumer categories.