What’s in a name? Quite a bit if you ask Daymond John, founder of clothing manufacturer FUBU and star of the hit TV show "Shark Tank."
"Having a strong brand, whether corporate of personal, always creates a halo effect," John says. "A lot of time that’s the only thing that separates you from everybody else."
Standing out from the pack as an original was John’s intent when he named his nascent company FUBU, an acronym for "For Us, By Us" that conveyed the business’ original, largely African-American target market.
John has since stretched the FUBU brand to reach a broader market and expanded into entertainment-related products and services. Yet, he has always remained true to serving the company’s core customer.
"It always comes back to the mission statement and the base," he says. "Like a building, if you have a weak base the building will crumble. Whatever the identity and the product you’re building, you have to stay true to that first."
John’s new book, "The Brand Within," hit the book shelves in April. In it, he explains how branding relationships have become integrated with everything we do – from buying products and services to determining which television shows we watch; what music we listen to; and the food we eat.
Smart Business caught up to John and discussed the importance of personal brands, how to nurture a company’s identity and why you better sum yours up in three words.
Q. How can a company benefit from having a strong brand?
In a tough time like this, when everybody is holding their purses and wallets very close, the people they will end up spending the money on are the brands they are comfortable with because the brand is portrayed as something that gives them a comfort level.
Q. Can that help a company accelerate its business performance and expand its offerings beyond core products and services?
Sure. Let’s look at electronics. While they haven’t branded it this way, I’m not certain that I would buy a BlackBerry television or anything else beyond a phone from BlackBerry if they offered it. But I would buy a television or handset or any product that Apple came out with.
Why? It’s the branding and years of coming up with innovative ideas. It’s the marketing. It’s that everything Apple comes out with works with each other. And, it has a cool factor – Apple reinforces its brand with great service and beautiful stores.
So you look at Apple and you look at BlackBerry and have to think about the difference. If BlackBerry created a TV, you would ask yourself, ‘Why would I buy a TV from them?’ BlackBerry is known for giving very fast, clear, precise information. So it’s not a far stretch for them if they decided to follow the same path with televisions. But because of the Apple brand you’ll buy anything that comes from them. BlackBerry is probably behind them in branding only because they’ve concentrated on one device and didn’t grow the brand beyond that.
Q. So should CEOs view their brand identity as an asset that can be managed, nourished, invested in and leveraged?
A lot of people or companies try to chase the market. If you chase the market, then you’re behind the market. If you’re chasing something, you’re saying, "They did it," by the time you come out with it, you’re late. So you always have to stay true to your customer base and what you created, but you have to come up with innovative ways and take those leaps and bounds and chances to improve the brand you have.
I believe that every brand should be able to be spoken about in three words. Whether it’s BMW – Fine German Engineering – or any other company, you need to be able to wrap up your whole mission statement and identity in three words.
Q. In your book you detail how people are brands just as much as companies are brands. What does that say about the power of a personal brand?
A personal brand is actually more effective than a corporate brand because everything starts with a person. Think about it. If Steve Jobs gets sick, the brand itself, the stock, goes down 20 percent.
When we’re on Shark Tank we judge those people between the time that they open those doors and before they open their mouths. Those people walk up to us and they stand there for about three minutes while the hot light and camera is on them and we’re staring at them. It’s very intimidating.
Some people get shifty. They’re quivering and sweating, and you feel like they’re lying already. Some people have this innocence to them. They’re smiling, they’re looking at people and they’re laughing. They’re nervous, but you can see a pure aspect in them. They say the same thing about juries when they see somebody walk into a court room. They either judge them guilty or innocent. After that, they just want to hear what convinces them of what they already think.
As a personal brand, you’re judged hundreds, thousands, and if you’re on television, millions of times a day. You’re selling every single action you take and every single word you speak. You’re selling yourself, and that is the brand you represent or own. That’s why that’s more important than anything else.
Q. So how can an individual strengthen his or her brand?
Are they being true to the base? A con man’s brand is stronger than anything else. He perfects all the things that let you put your guard down and put trust in him. Think about a con man. He goes out and concentrates on the things that you’re going to brand him with. He’ll make you say, ‘Oh, he’s trustworthy.’
If you’re a person who will go out and perfect things, you have to understand what it is you’re selling. Are you selling a service in the service industry? Are you selling people how have a need or desire for something? Are you somebody who makes life better from an economic standpoint or are you giving somebody a luxury that separates them from everybody else? Those are two different approaches.
The luxury approach, you’re going to brand yourself like this: You’re very manicured. The way you speak and the car you drive say things about you. All of those things are going to be very excessive.
If you brand yourself the other way, you’re going to be very economically safe and not buy high-end products that make it look like you waste money.
Q. One of the definitions of the word "Brand" that you provide is "a type of energy that radiates from an individual." How did you come to that observation?
All this is from the FUBU days. This thesis I have and the dumbed-down version of trying to explain to people that everything in the world is a brand is from what I’ve acquired my whole life of being out there.
Q. People don’t realize they’re doing it?
Yes. That’s the biggest aspect of the book. People do not realize that they’re doing it. I get approached by a lot of business executives who don’t carry themselves correctly or present themselves the way they think they are. And they don’t understand why people don’t support them. On the flip side, I s ee a lot of ventures where people get enormous amounts of money and I don’t think they’re as capable as the other people out there but they packaged it correctly when they sold it.
Q. You’ve offered an interesting theory about how companies balance intentional and unintentional marketing in their messages to consumers. What’s the difference?
There are brands that have traditional consumers. They don’t want to detract or scare away their traditional consumers but they want to grow their business and be attractive to another market. Let’s use Timberland as an example. It was built and marketed as the best boot in the world.
Timberland obviously was made for hikers and the like. The same goes for Northface and brands like that. Somebody buying a Timberland from a technical aspect – a mountain climber or a hiker – they’re going to buy one pair of Timberlands every year or maybe every two years. Why? Because it’s the best boot in the world, so you shouldn’t be buying it every week.
But if you want to get to the demographic of the popular culture, the 40 and under, the rap, Latino, etc., these people are the ones who make Nike such a huge company because they buy a pair every two weeks. Once they get it scuffed, they have to get a new one. So they buy from a fashion aspect. You can’t market to them like you would the core group because if you market to them, then what are marketing? The best boot in the world to get a scuff on? So, you have to do an unintentional marketing campaign aimed at them and give the appearance that they came after and sought out your company and grabbed your company.
So you have to market to your initial core – the hikers, etc. – and then you have to do a different type of marketing, such as incentives in the stores and things of that nature, where the public doesn’t think you’re marketing to this demographic that is not yours but that demographic spends ten times more on your product than your core, original market does. So there’s intentional and unintentional marketing, and you need them both.
Q. What about premium prices?
Most of the time, the reason why products have a premium price is because you’re paying for everything else – the advertising and licensing. So we have to roll that into the costs.
Q. How important is it to develop and launch a brand internally before going out to the marketplace?
There’s a little balance necessary. Internally, you have to make sure the pieces are in place. Is the product technically proficient in the area it’s in? Second, you have to set the margin and price on it and know what that magic price point is that makes it acceptable. We all have a magic price point. Then you get the DNA of it – the three words; what’s the message we’re putting out.
Then there’s that moment. If you’re a new company or a big company, there’s that focus group moment where you trickle it out to the consumer to hear about people who are not close to the product. You need to hear from those people that have no knowledge or love or couldn’t care less…you need to know if they’ll take $5 or $500 or $5000 out of their pocket and buy the product.
Because of the age we’re in, with transparency and Twitter and Facebook, you have to put that product out to see how the world gravitates toward it or goes away from it. That’s a fine line you have to walk as an entrepreneur.
Q. Are there warning signs you’re stretching your brand too far?
Yes. Once you put it out there in that space – and you have to find creative ways to put it out there these days – and people just don’t like it, support it, or against it or are appalled by it.
The days of focus groups where you bring people into a room and pay them $100 and you look and see what they say are over because you have the Twitters of the world. These people don’t owe you anything. You’re trickling it out there and putting out test balloons and seeing what happens.
You can’t have thin skin. People fall in love with their brands and ideas and don’t want to listen to anyone else and hear that they do have an issue. There are a lot of people who haven’t been able to do that in life or business. Egos have taken down way too many companies.
Q. When a brand or reputation becomes impaired or damaged, what are some ways to repair it?
We are in such a different time. You can attempt to repair it through transparency. Just stand up and say it. If Tiger Woods had just come out and said it immediately, it would have been a very, very, big bullet to bite. But it’s going to come out nowadays. There aren’t the days when reporters or brands had these understandings. The world is an open book. I think that you have to be honest, as quick as possible, to respond.
That really is the easiest way. Look at when it could have ruined Madonna’s career when the naked pictures came out. In the beginning, she was at the Lady Gaga stage of her career, and here this came out, she had these naked pictures. Madonna was asked about them and she said, "Naked pictures. So what?" That just stopped everything. The rumors were over and she moved on. It’s really about transparency.
Q. Is a complete rebranding worth the effort or can you take the same brand and just re-market the way people think about it?
It depends on whether you feel the brand you have has run its course. Generally, it works when you’re dealing more with a luxury item. I’ve done it several times with FUBU. FUBU had run its course and the price points were coming down, so I went and acquired a license for Fat Albert and I named it Platinum FUBU, and all of a sudden it shot back up. Now, that’s run its course and I’m naming it FB Legacy.
It’s like Mercedes. They have the 600. Then they come out with a higher number. It works with luxury brands. The insiders know the core of the brand is the same – the same FUBU guys, the same Mercedes – and they have an understanding of running the business.
But the trendsetting person comes at it from a different perspective – they see it as an improved brand: I don’t wear regular FUBU but I wear that new thing they have. I don’t drive the Mercedes because everybody had them and I started driving Bentley’s, but now I’m driving something else. This works well in the luxury product or service space.
Q. What should be done when a brand becomes tired in the marketplace?
You need to either pull out or reinvigorate it. Sometimes you pull out and give it a rest. That’s sometimes the best thing. The good thing about having a brand is that no matter what, when you come back, you already have millions and millions of dollars worth of advertising and marketing. It creates a vacuum. You actually become missed in the marketplace, and when you return you resonate with a lot more consumers than you might have resonated with before. It can be a very good thing when you pull out for a while.
Q. What trends are you seeing that affect the way people look at branding?
The two biggest trends right now are social media and product integration. Product integration is important because we’re in a world with TiVos, iPods and downloads and people aren’t seeing commercials that much. When they do, it’s become like wallpaper and you know it’s a paid advertisement.
So in order to promote your brand, you find smart ways to integrate products within the world, such as within music and television and art and entertainment. It doesn’t cost as much as advertising. It doesn’t look staged. And it resonates with the consumer because you’re placing it in something that is important to the consumer. Imagine integrating your product in other things that have a powerful effect on consumers. When you do that you can quickly grow your brand.
Q. What’s the one thing CEOs need to keep in mind when thinking about their corporate brand?
Does the brand get captured in three words? What are your three words? Figure that out and then communicate it throughout the organization. In corporations, you sometimes have to clean the slate and think differently, then start over. It becomes your mission statement and everybody needs to think along those lines.
Q. You were named a regional Ernst & Young Entrepreneur Of The Year a few years ago. Tell me about the experience of winning such a prestigious award?
I was the 2003 Retail Award winner in the New York City region. I was actually a national finalist and beat out by the JetBlue guys for the national Entrepreneur Of The Year Award. It was a great acknowledgment. When I went out there it was an impressive room of people and I was happy to get to that point. You meet a lot of great people out there and can learn a lot.
How to reach: Daymond John, www.daymondjohn.com