Food and healthcare insurance are but two industries that must wake-up. I love the news. It provides a daily reminder of the need for business model innovation. Healthcare and food are increasingly interconnected, each offering insight into business model innovation best practices. Food that expands market share, not our waistlines. I admire PepsiCo. To make its food healthier, PepsiCo leaders have invested in unusual talent (e.g., a Mayo Clinic endocrinologist and World Health Organization Chronic Health Disease chief) and genuine product innovation. This week the company announced work on a lower-sodium solution to achieve a salty taste in potato chips and other snacks. Last week we learned that PepsiCo will no longer sell high-sugar sodas to PK-12 schools. My admiration rests in PepsiCo’s leadership evolving their business model’s value promise and advantages in advance of government regulations or new entrants scoring huge market…
When Is Bigger Better in Business Model Innovation?
I spent the weekend in Scotland, where one cannot escape RBS’s logo, RBS standing for The Royal Bank of Scotland. Its brand imagery stands out exiting the airplane, passing city billboards, and reading or listening to local media. Today, the people of Scotland own close to 70 % of RBS because the former (duly fired) CEO and his board believed that bigger is better. With a small domestic market of 5.2 million residents (about the size of Minnesota) and strong English competitors, RBS acquired what turned out to be a poorly run Dutch bank in order to grow. Thankfully, a strong domestic position will keep the bank in business; but it will be a long time before Scottish taxpayers are repaid for keeping RBS afloat. Small is beautiful. Consider PNC, the regional bank headquartered in my hometown of Pittsburgh compared to Bank of…
Why Capital Bank’s Attributes Fail as a Value Promise
Last week’s post talked about the vital alignment between your brand platform and your value promise. A great example of getting the two concepts of brand and value promise wrong comes in a series of ads that Madison’s Capital Bank presents in the daily Wisconsin State Journal. Each ad contains a picture of one of the bank’s commercial lenders with the words Capital Bank to the left followed by three adjectives. Capital Bank Knowledgeable Resourceful Responsive The three adjectives or attributes may be what differentiates Capital Bank lenders from competitors’ lenders. But these three adjectives are neither a value promise nor are they reflective of a thoughtful brand platform. Before I explain why, let’s look at a winning example. A winning value promise and brand promise example Walmart’s “everyday lowest price” is the company’s value promise, its “True North” that drives all internal…
Are your business model and brand strategies aligned?
A new client asked me a good question today. “You talk Kay about helping us find our value promise, but my communications agency is totally focused on our brand platform. What’s what and why does it matter?” The answer rests in understanding communication challenges. The internal communication challenge Employees need a shared and actionable aim that advances the company’s success. It must be actionable so that employees and teams know how to go about their work. The aim must also be shared or else actions by one part of the organization hurt another part’s success, creating distrust and silo-mentality. (These two requirements are why “Grow profits and revenue” as the only aim fails.) The best internal directive is a value promise. It’s the promise the company makes to its target customers and the basis on which it wants to win business. Internally, it…