Brand Scaling and Authenticity

Part
01
of two
Part
01

Scaling Authentically-Case Studies

Arizona Iced Tea, LEGO, and Crayola are brands that were able to successfully scale while adhering to the essence of their brands. Below are the findings for this research.

THE 99-CENT CANS OF ARIZONA ICED TEA

  • Since the company launched in 1992, Arizona Iced Tea has managed to sell their 23-ounce cans of iced tea for 99 cents. They were able to keep this price despite scaling their production from 150 cans per minute to 15,000 cans per minute.
  • Don Vultaggio, the co-founder of the Arizona Beverage Company, believes that the 99-cent price of their tallboy cans has become part of the Arizona Iced Tea identity. In 2016, they were able to sell an estimated US$1.2 billion worth of 99-cent iced tea, making them the second-largest ready-to-drink tea brand in America.
  • Arizona manages to maintain the price of their tallboy cans through minimizing costs in places such as production and distribution and foregoing traditional advertising.
  • Production costs are minimized by reducing the amount of aluminum they use for the cans by about 50% compared to when the products launched in 1992.
  • Distribution costs are minimized by running delivery trucks at night to avoid heavy traffic and utilizing a hybrid distribution model wherein the company delivers some goods itself, others are taken care of by distributors, and some go directly to the warehouses of big chain supermarkets such as Costco and Walmart.
  • For advertising, Arizona Iced Tea relies on their brand legacy and social media instead of spending on advertising through other means such as print and TV advertisements, and celebrity endorsements. The brand showcases their signature turquoise cans around the world on Instagram where they have about 180,000 followers.

LEGO AND BEING BUILT ON CREATIVITY & STORYTELLING

  • From its inception in 1932 by founder Ole Kirk Kristiansen, the LEGO bricks have received little iterations. The plastic brick design as it is most known for today was first established in 1958.
  • Julia Goldin, the Chief Marketing Officer of LEGO, states that their company is mission-driven. They want to "inspire and develop the builders of tomorrow."
  • In an attempt to increase their sales and media presence, LEGO branched out to new product ideas. Their new product ideas, however, were not very successful at first as their early attempts of branching out were met with disappointing results.
  • They attempted to launch a cartoon series called "Jack Stone" and a live-action series called "Galidor: Defenders of the Outer Dimensions," however, both shows were not successful and cost the company a hefty amount. They also tried to make LEGOs that catered to girls, however, they used a new system for these lines instead of the normal LEGO bricks which lead to another sour reception.
  • It was in the early 2000s when the LEGO company finally began to understand that in order to successfully scale their company, they would have to tell stories that are relatable to children and appeals to their creativity and imagination. This lead to the creation of product lines such as LEGO Bionicles and Ninjago, both lines seeing success and driving revenue for the company.
  • LEGO has since spawned products beyond toys such as movies and video games that successfully portray the brand's identity of story-telling and creativity.
  • The LEGO company also finds user-generated content such as those found on Youtube valuable. In fact, the most subscribed branded channel on Youtube belongs to LEGO with 5 million subscribers.
  • LEGO is currently the world's most valuable toy brand being valued at US$7.571 billion as of 2018.

CRAYOLA AND UNLEASHING ORIGINALITY

Part
02
of two
Part
02

Scaling Authentically-Best Practices

To scale, without losing brand authenticity, brands should (1) get clear on their values, (2) be transparent, (3) employ people that naturally embody their brand, (4) pullback (remove) the curtain on their operations, and (5) give back.

(1) CLEAR VALUES

  • Being authentic implies promoting brand values and purpose. To promote brand values successfully, brands first need to identify what your business stands for and use it to guide your marketing efforts.
  • According to Lisa Cox, a brand strategist and designer in the San Francisco area, brands must get clear on their values by asking why their businesses exist and why their brands matter.
  • As organizations try to come out clear on values and portray what they deem will fly as authentic, they need to note that consumers can see whenever there is nothing to back their claims up.
  • According to Fabrikbrands, for a majority off businesses, brand values have been the “true north” on their compass in their journey towards market success.
  • By leveraging on the "Think Different" campaign, Apple reveals that its values are focused on making the worlds best and most creative products while keeping its technology "simple for the masses."
  • The Nike brand uses values that link back to its motivating tagline, "Just do it." This tagline was designed to combat the growing United States obesity problem. It also captures Nike's ideals related to heroism and drive.
  • One of the best ways to get brand values across involves telling the story of the brand and doing so in a genuine way. Chipotle has done an excellent job in this regard. Chipotle is committed to serving food items sourced through ethical means and states this on their website.
  • Chipotle also reveals its brand values on its product packaging and in-store displays.

(2) BE TRANSPARENT

  • In an attempt to display authenticity, brands must seek transparency as it is the foremost way to showcase authenticity. It is vital to give people a view of how a brand runs its business or create its products. This transparency adds credibility to the brand and encourages its sales and loyalty.
  • Brandingmag reveals that transparency is the emerging (new) brand paradigm (typical example or pattern).
  • Transparency is a potent tool for brand communications, and according to Chris Barth, it is rapidly emerging "as a new marketing paradigm."
  • Domino’s Pizza recently found itself getting terrible reviews amidst significant market share decline. The brand instituted a turnaround campaign on total transparency by fixing its recipes and broadcasting its process to the world. The brand even ran advertisements on Times Square videos detailing how it handles its orders.
  • Studies reveal that 74% of the United States residents believe there is little trust bestowed on brands by society than ever before. About 54% feel trust has become more critical than ever. Transparency is the tool that brands can deploy to obtain consumers’ trust.
  • Trust is known to be the single most crucial ingredient required for brand success. According to "Label Insight, a firm that helps consumers understand "what's in products," about 39% of people reveal that they are willing to switch to a new brand that is entirely transparent. About 56% would be loyal to transparent brands for life, and about 76% are willing to pay more for transparent brands.

(3) EMPLOY PEOPLE THAT NATURALLY EMBODY THE BRAND

  • According to a publication on the age of authentic marketing, which reveals a guide to gaining consumer trust published by Power Reviews WEB, brands must employ people with the right attitudes.
  • To scale authentically, every brand should deploy people who have the same passion (with the brand).
  • Brands should hire for attitude then train for skill. Organizations need to know that while they can teach people sales strategies, it’s very much harder to alter individual values and disposition.
  • Some top companies in the world are known to hire only people who share their values and embody their image. Such companies factor an authentic marketing play into their hiring methods. Trader Joe's is famous for being a quirky and friendly brand and hires only people that are naturally outgoing love talking to others.
  • Mark Gardiner, who is the author of Build a Brand Like Trader Joe's, recently went through Trader Joe's training program after applying "for a position at the grocery store."
  • Several sources, including MyTotalRetail, reveal that Trader Joe's has advanced success formula and is positioned for "other retailers learn from it."
  • Joe Coulombe, the founder of Trader Joe's, revealed in an interview that hiring the right people who share company values, as well as the cultural values imbibed in them during training helps in explaining the superior quality of his staff and their high retention rate (low turnover).
  • The staff friendliness and services of Trader Joe's have been ranked to be among the "top five store choice drivers identified," according to a Minerva Insights & Solutions study on primary grocery drivers.
  • Forbes reveals that Trader Joe's has an "industry-leading ACSI customer satisfaction score."

(4) PULLBACK (REMOVE) THE CURTAIN ON OPERATIONS

  • Brands are encouraged to give people a view of their behind-the-scenes business activities to scale and remain authentic. This strategy is achieved by the brand introducing customers to the personalities running their operations, processes, and business activities.
  • The behind-the-scene activities of a brand reflect its public image and help it earn public trust as well as confidence. Customers will not trust brands unless these brands promote themselves in a way that makes them feel like being part of the band. This process requires some effort on the part of the brand.
  • Reformation is an apparel retailer known to expose its focus on sustainable fashion. The company did this in 2018 when it posted several Instagram stories revealing details of its factory operations. Reformation also encourages its followers to demand more information on its processes via Instagram and publicly replies their questions.
  • Reformation, known as the "cool girl's" clothing company has several stores in New York and Los Angeles. The company is expanding into brick-and-mortar when retail brands find it tough and are closing their stores across America. The startup closed out 2017 with the estimated revenue of over $100 million.

(5) GIVE BACK

  • Giving back to the causes that support a brands' mission is an excellent way to display authenticity. It shows that a brand is serious about its vision and is not just "spewing feel-good platitudes to win people's business."
  • The outdoors apparel retailer Patagonia is doing this successfully. Last year, the company revealed its intention to take about $10 million it saves from some recent administrative tax cuts and donate the same to environmental groups.
  • Several cases of giving back were identified as the "top 20 corporate social responsibility initiatives of 2018." They include Abercrombie & Fitch a cool label for American teens which launched a five-year, $15 million partnership. The partnership "with SeriousFun Children's Network" is meant to support community camps and several programs and also help children with serious sicknesses.
  • Equinox, a gym operator, has become a lifestyle brand. The brand takes an interactive approach to raise funds for charitable causes.
  • Ben & Jerry's, an ice cream label is known for its numerous zany flavors like "half-baked" and "fish food." The brand engages in grassroots initiatives. The foundation awards over $1.8 million yearly to fund community action, social changes, as well as other sustainability initiatives in its home state of Vermont and all over the United States.

(6) LEVEL UP THE FAQS

  • FAQ pages are an excellent way of adding a layer of authenticity to a brands image. This level of authenticity is achieved by allowing visitors to submit inquiries. These inquiries/questions are answered publicly.
  • FAQ pages work best for product pages, to address item-specific inquiries/questions. Genuine FAQs pages don’t just contribute to a brand’s authenticity. They also guide shoppers and assist them in making "more informed decisions."
  • Otterbox is known to provide an excellent FAQ product page. All of Otterbox's product pages give access to a FAQ tab which contains user-submitted questions and candid replies from the Otterbox team.

METHODOLOGY

Our team scoured through several resources, including Forbes, Brandingmag, Businessinsider, etc., for insights into best practices for brands that want to scale, without losing brand authenticity. Several resources, including Power Reviews web, revealed authentic marketing recommendations and guides (practices). These practices help brands gain consumer trust while amplifying their identities through value communications, giving back activities, etc. To qualify as best practice, we verified these practices across a plethora of sources and confirmed that several organizations practice them.
Sources
Sources

From Part 01
Quotes
  • "The company, which launched in 1992 from a warehouse in Brooklyn, New York, now sells around 3 billion containers of tea, juice and sparkling water each year, but its most popular products are the jumbo-sized iced tea cans, found in delis and family-owned bodegas around the country. And the price is currently lower than the average cost for a single bottle of water at $1.45."
  • "“It’s difficult,” Wesley Vultaggio, the creative director of Arizona and son of company founder Don Vultaggio, told MarketWatch. The company, he says, makes and sells more than a billion cans annually. “Our big cans are our workhorse. We make up for it with the volume that we do.” "
  • "To keep production costs down, Arizona has decreased the amount of aluminum used in its 23-ounce cans by 40% since it launched in the early 1990s, the company said. It also has upped its output to produce 15,000 cans per minute. When the company first started, it was producing just 150 cans per minute. "
  • "Another cost-saving measure: chief marketing officer and co-owner Spencer Vultaggio says Arizona does not do traditional print and TV advertising or celebrity endorsements like competitors including Coke KO, +1.74% or Fiji. Arizona relies solely on its brand legacy and social media instead of traditional ad campaigns, which can cost at least $10,000 per month, or up to $120,000 per year. "
  • "“We’re very active in social media. That’s our largest tool to speak to the younger consumer,” Vultaggio says. The brand has 180,000 followers on Instagram FB, +0.35%, where it showcases the company’s signature turquoise cans around the world. Its competitor Lipton Ices Tea has 49,000 followers."