AS PART OF GENERAL ELECTRIC’S CORPORATE-CITIZENSHIP PARTNERSHIP WITH THE UNIVERSITY OF MICHIGAN’S ROSS SCHOOL OF BUSINESS, the company’s CEO, Jeffrey Immelt, regularly journeys to Ann Arbor to participate in the school’s MBA orientation session. During that session, there’s one thing professor Noel Tichy can count on hearing Immelt say: “If GE wants to stay the same, they don’t need me.”
“You have to drive change,” recites Tichy, the director of the Global Leadership Program at the university and a high-profile management guru who recently coauthored, with Warren Bennis, the corporate-leadership tome Judgment: How Winning Leaders Make Great Calls. “Change starts with a constituency of one, and driving change is my job.”
By the accounts of top image consultants, Immelt has met his own high standard. He’s fired off a series of strategic new initiatives that have helped transform the company’s image from environmental laggard — muddied in an embarrassing pollution fiasco — to green-business leader.
The image surgery has required years of effort and millions of dollars in commitments, but the payback is tangible; GE is now known for offering some of the most environmentally friendly products on the market. Immelt has taken a company long lauded as one of the best-run in the country — its track record is notable for Jack Welch’s take-no-prisoners corporate revolution — and achieved an even greater can-do reputation.
When it comes to a company’s image, change is a constant, whether you like it or not. There is no safe middle ground to occupy and defend. Today’s number one market mover is tomorrow’s stale has-been; bright becomes faded seemingly overnight. And whether a corporation caters to people or to other businesses, it has to run just to keep up with customer expectations.
But that’s always been the case. The new twist is this: Remaking a corporate image used to revolve almost entirely around a carefully crafted mass-market advertising-and-promotional campaign. These days, that’s impossible. Consumers are moving into new spheres, their collective attention migrating to social-networking sites, online news and information, and virtual communities. Finding those consumers, and making a company’s case to them, demands a much more personal, one-on-one style that challenges every image guru to help rewrite the rules for a brand-new game.
“Peers’ opinions and individuals’ opinions about a company are seen as more believable than a company’s perception about itself,” says Michael Thibodeau, managing partner of Verse Group, a brand consultancy. “Today, in search of true statements, people go to blogs and other online sites to see how it performs. That’s true of consumers as well as in business-to-business. You check under the hood.”
In real time.
“Things happen faster,” says Tichy, “and they’re much more transparent. We live in a world of instant communication.”
And failure always lurks in the shadow of every major success.
IN THE SPACE OF a few short years, a brash, boundless Dell went from being number one in the country’s consumer market, with a killer direct-to-consumer sales strategy, to being a faltering number two, dragging behind the resurgent Hewlett-Packard. To add insult to financial injury, Dell has always been seen as lagging behind Apple in style; the gray-tinged mass marketer has never come close to commanding the kind of avid devotion the technogentsia have given Steve Jobs’s product wizardry at Apple.
But the company is trying to shake things up.
Dell is devoting $4.5 billion over three years to partner with WPP to create a new global integrated-marketing agency, which will have 1,000 employees who will eat, sleep, and breathe Dell image and Dell marketing. Dell will be the first client of the new agency, which will likely have additional clients over time. The company originally dubbed the move (officially called Enfatico) Da Vinci and is definitely looking for some Leonardo-like genius help with the image-rehab business. Even before Enfatico, though, there was an online social-media strategy being implemented — a movement to engage Dell’s global audience with blogs and to create a web presence that, by design, would seep into the social-networking consciousness of America, where viral videos and mass buzz can drive image makeovers and product sales. And Michael Dell’s recent return to the CEO post — Tichy rather scornfully says he never really left — has been heralded inside the computer giant as a virtual second coming, one that will usher in a new era of cool machines.
“Are we trying to change Dell’s image?” asks Dell’s vice president of global-marketing services, Casey Jones. “Yes, one customer at a time.
“Most brands are trying to constantly project an image,” he says. “We’re trying to have a dialogue with our customers and develop our relationship with them one by one by one by one. That is a different philosophy. And we’re looking to be perceived differently in three years.”
In some respects, Dell is moving into uncharted waters. But so is everyone.
“IT’S COMMON KNOWLEDGE in the marketing industry that old models are not working as effectively as they used to,” says Jones. But that doesn’t mean Dell is helpless. “You blog. You build searchable content on your site that people can download, provide a forum for people to get back to you, aggregate information from customer support calls to improve communications with them. You open your ears to every single point of customer contact,” he says.
The new model, though, comes with some new rules.
“The Facebook promise is that you can have people become friends with your brand and then they become promoters. Companies and brand managers have a seat at the table,” say Michael Megalli, a partner at Group 1066, a branding firm. “But it’s not just their table anymore.”
That’s what Procter & Gamble understood when it set out to build its own social-networking site.
“P&G has been a very smart, Internet-focused example,” says Megalli. “Everyone knows how research-focused they are, how they get into each market to find the things customers are grappling with to apply a product or technology they have. They created the Vocalpoint site, an online social network that currently has about 600,000 women, mothers of children 19 or younger, participating. It provides a platform for really actively engaging with a large portion of P&G’s customer base to hear the things that are frustrating them about existing products or about their lives so P&G can respond to them.”
Doing that effectively can require some uncommon corporate restraint. P&G stays largely behind the scenes at Vocalpoint. It doesn’t flood the site with products, logos, and promos, and it lets the community do the talking.
But the commercial objective is ever present. The website enlists its volunteer market force in the company’s marketing campaigns, arming them with coupons to spread the word on products in viral fashion: among friends, coworkers, and family.
“The fact is that there is a shift in the power dynamic in the way that companies operate in the marketplace,” says Megalli. “It used to be that brand managers had a command-and-control approach to their brands, deciding on a media spend, sponsorships, a PR strategy; in the middle of the year, they would sit around planning the next year. That still happens. You still have people whose job it is to promote a brand in the marketplace. But the way that dynamic works is much different. Customers have a more important voice in the way a brand lives and dies in the marketplace.”
THERE’S ONLY SO MUCH a new branding effort can do.
“The brand is the business strategy communicated,” says Jim Gregory, CEO of the image-maker CoreBrand. “And if the business strategy isn’t good, branding can’t really be effective. Companies have to tread carefully, make sure it’s a long-term plan and not just propaganda.”
The same holds true for the current push to add a green tint to corporate portfolios. Just buying a green product or a green company isn’t enough.
“Too many companies are trying to be green at the same time,” says Gregory, “You have to be sure that your program is very clear and true and pure.”
As the corporate image and communication becomes more personal, it also becomes more demanding. One false move is quickly branded as fakery. Lack of authenticity is the one unforgivable sin of marketing in this sphere.
Take this, for example: Thibodeau is quick to label Philip Morris’s decision to rename itself Altria in 2003 “cheap gimmickry.” No quick name change was going to dispel the smell of tobacco at that company.
Don’t discount the role of luck — good or bad — either.
British Petroleum’s effort to remake its image around its initials — BP — giving them an entirely new meaning (“beyond petroleum”) ran into a buzz saw of angry criticism after the company’s refinery explosion in Texas and its Alaskan oil spill.
“When BP relaunched, initially it was lauded, because it was making a very big promise,” says Thibodeau. “And it was then seen as untrue. It turned into a very big target — when are they going to deliver? It was too hard, too far.”
But that’s just the kind of crisis a savvy CEO can act on.
One day McDonald’s is the chubby corporate poster boy for obesity in America, losing ground to new competitors like Starbucks, whose hypertrendy stores boasting Wi-Fi are popping up on every corner. And then the next day, McDonald’s is getting some good buzz for offering Newman’s Own dressing and fair-trade coffee, giving Starbucks the jitters.
“Ten years ago, GE was not seen as a green company,” says Megalli. “In fact, it was seen as enemy number one. The Hudson River dredging was really hounding them at that point.”
Instead of denying it or hiding from it, says Megalli, GE came up with Ecomagination — complete with its own Ecomagination website, of course — creating moneymaking products that earned their label for environmental consciousness.
“GE is doing a very good job of managing what people think of the company overall,” says Thibodeau. “It does that through making the information visible in every single point of communication. It runs through ad campaigns, products and services, and green technology. The company develops microsites to talk about its mission and values. Those also come up in speeches, so if Immelt is speaking at a conference, he’ll talk about GE’s green initiatives, bring up GE values.”
“GE has done it very well,” agrees Gregory, whose firm tracks corporate images in an annual survey. “They’ve been doing it consistently over time. It was a big transition from Welch to Immelt. But its image today is stronger than when Jack was running the company.”
That just makes Immelt’s job even bigger.
“You’ve got to be paranoid all the time,” says Tichy about image making, paraphrasing another of his favorite business sayings.
“Change before you have to.”