Buzzing on brands: never has image made so much difference in business. From logos and corporate identity to consumer trust and perceived value, the buzzword is "brand" - Special Advertising Section; Advertising, PR and Branding

Japan, Inc., April, 2003 by Gavin Blair

One of the challenges facing any company attempting to break into a new market is competing with entrenched domestic behemoths; nowhere is that as true as it is in Japan. Bates Yomiko, who had been in Japan as Bates since the 80s before they linked up with Yomiko, has the experience of being David to the domestic Goliaths in their own industry. They are able to employ this know-how to help foreign firms establish their brands through fully integrated marketing communications approaches. "In 1999 we launched 141 -- a sales promotion, event and sponsorship brand management specialist arm -- and recently expanded our CRM capability." In tough economic conditions and facing much larger competition, working smarter is the only option. David Meredith, president at Bates Yomiko says, "With the exception of 2000, advertising expenditure has declined for the past five years. I see no change in this trend. What it therefore means is that every budget has to work that much harder. More for less. The days of sheer impact through blitz are over, and communication will have to be smarter -- hence all the talk now of branding. And the growth in alternative forms of communication to TV, magazine and newspaper. We will also see growth in the areas of collaboration where brands appealing to the same target can work together to heighten the brand experience and reach the customer more efficiently and with greater impact."

If the value of a brand is more than just immediate sales figures, then the quantification of that asset produces an interesting conundrum. How can return on investment (ROI) be reliably measured by companies wanting to make the best use of increasingly tight marketing budgets? Douglas Faudet, CEO of DDB Japan, part of the DDB Worldwide network, says, "This is an increasingly important question but one that is still difficult to answer. It's like asking an electronics manufacturer how to measure the ROI on R&D. There are two ways to do this. The first is to measure the effect on business performance. DDB increasingly bases our compensation on a fee basis that often provides for a performance bonus. This ties our success directly to our clients' success and provides for bottom line accountability. Furthermore, we work with most of our clients to set objectives, goals, strategies and measures. Then we track performance against these measures. This is very much a packaged goods approach to business, and we belie ve that results are all that matters with advertising. This is the basis of our company motto: 'Better ideas. Better results.'"

There may never again be the kind of money poured almost indiscriminately into marketing as there was during past stock market and booms -- not without concrete measurable results. According to DDB's Faudet, "In some ways the 'Branding business' is still suffering from a hangover from the 'dotcom' party. We hired too many people, spent too much money on unfounded business models and silly ideas and focused too much on TV because it was the easiest way for an ad agency to make money. When the bubble burst, the only costs we could shed were our people, and a lot of seasoned (and more expensive) talent was let go and less experienced (and cheaper) people retained. In turn, clients lost confidence in us because the miracles promised by advertising didn't come true." He adds, "I think that the market has bottomed out and we're starting to recover -- in a more intelligent way."