How CIOs Can Build a Better Brand

CIO — When Tom Peck, CIO at Levi Strauss, spoke at this year’s CIO 100 Symposium, there was something distinctive about his presentation: It was light on IT and heavy on marketing. It sounded like a commercial—which was a good thing.

During the presentation, I tried to muffle my “Hallelujah!” so no one would call security. Tom Peck and Levi Strauss get it! They understand that innovation efforts and IT executives need to focus first and foremost on brands.

Why? In today’s rapidly changing global marketplace, brand preference is critical to success. Brand preference—being preferred by a buyer over all other alternatives—is the true source of sustainable brand value. Some brands, like Coca-Cola, have achieved this for more than a century, but brand value isn’t an entitlement. It has to be continually earned through sustainable competitive advantage.

The competitive advantage may be the relative quality of products and services (as defined by the buyer), superior distribution capability, or ease of doing business. The CIO should play a key role in ensuring that the company constantly improves its competitive advantages.

But be forewarned that there are four common myths about brands:

Myth 1: Brands are durable assets. Brands come and go. They die—either natural deaths or by acquisition—when the companies that own them fail to compete in the marketplace. Brand equity is the result—not the source—of competitive advantage, and we all know that competitive advantage can be fleeting. Sustained success requires three things: a strong business model; the ability to run and change the company at the same time; and accelerated projects that help create the future.

Myth 2: Strong brands can command premium prices. No, it’s the competitive advantage that commands premium prices. Apple can do it because its products are currently superior, but if the time comes when that’s no longer true, the company’s margins and growth will decline.

Myth 3: Brand loyalty is real. Actually, brand loyalty is an illusion. Brand preference is the proper goal because it’s the only way for brands to have a sustainable advantage. Competitive advantage is the source of this brand preference, and IT is key to attaining it.

Myth 4: Marketing is responsible for building great brands. While marketing is critical, a successful brand is built on, and sustained by, a strong business model. IT needs to be inextricably integrated into strong business models.

How IT Can Drive Brand Value

Innovation and IT are at the heart of improving brands because they’re critical to achieving sustainable competitive advantage. Technologies such as business intelligence, the cloud, social media and mobile tools and devices can be integrated with marketing, merchandising, sales, distribution and manufacturing to improve brand preference.

A successful brand requires a business model that’s crystal clear to consumers, an operating infrastructure that customers can trust, and meaningful human relationships that customers feel excited about.

Finally, your brand needs velocity. Systematically increasing competitive advantage through innovation and the strategic use of IT are critical to achieving this velocity. And the next time you have a conversation about IT in your organization, learn from Tom Peck at Levi Strauss: Talk about how IT is improving your brand.

Jack Bergstrand is founder and CEO of Brand Velocity, a consultancy that helps companies accelerate business initiatives. He is a former CIO and CFO at Coca-Cola and author of Reinvent Your Enterprise. Contact him at jb@brandvelocity.com.