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The Brand Called Obama

Win or lose, Barack Obama's rise changes business as usual for everyone. Here's why.

Barack Obama | Photo by Marc Nozell used under a Creative Commons license
Barack Obama | Photo by Marc Nozell used under a Creative Commons license

"Whatever you do, don't hurt Barack!" It was the afternoon of Super Tuesday, and the Chicago sky threatened snow. Senator Barack Obama had just returned to his hometown as voters in 22 states were making history by choosing between a black man and a white woman to be the Democratic nominee for president. The road-weary candidate put off calling fund-raisers or leading one last rally. Instead, he headed over to a downtown gym to play basketball with his nephew, his brother-in-law, and a few buddies. He needed to take a few minutes to chill out, and hoops was his therapy.

Among those on the court would be his old friend — and major contributor — John W. Rogers Jr. Rogers is the founder and chairman of Ariel Capital, an investment firm with some $13 billion in assets under management. He is a neighbor of Obama's in Hyde Park and has traded elbows with him on the hardwood dozens of times. But as Rogers left for the gym, he was accosted at the door by his colleague, Ariel president Mellody Hobson. A friend of Obama and his wife, Michelle, Hobson knew that Rogers, usually a shy sort, could be aggressive on the court. So she implored him to go easy on the senator: "He can't look all beat up!" It wouldn't be good if the candidate showed up on TV later that evening with a black eye.

Hobson had no need to worry, and not because Rogers held back. As Obama has been known to joke before he hits the boards — or the podium — "Relax, I've got game. I've got plenty of game." Super Tuesday proved him right: On the court, his team won two of three contests, and he walked off without a scratch. At the polls, he took 13 states to Hillary Clinton's 9, generating momentum that would build from the Potomac to the Pacific and, in some eyes, make him the Democratic front-runner.

The fact that Obama has taken what we thought we knew about politics and turned it into a different game for a different generation is no longer news. What has hardly been examined is the degree to which his success indicates a seismic shift on the business horizon as well. Politics, after all, is about marketing — about projecting and selling an image, stoking aspirations, moving people to identify, evangelize, and consume. The promotion of the brand called Obama is a case study of where the American marketplace — and, potentially, the global one — is moving. His openness to the way consumers today communicate with one another, his recognition of their desire for authentic "products," and his understanding of the need for a new global image — all are valuable signals for marketers everywhere.

"Barack Obama is three things you want in a brand," says Keith Reinhard, chairman emeritus of DDB Worldwide. "New, different, and attractive. That's as good as it gets." Obama has his greatest strength among the young, roughly 18 to 29 years old, that advertisers covet, the cohort known as millennials — who will outnumber the baby boomers by 2010. They are black, white, yellow, and various shades of brown, but what they share — new media, online social networks, a distaste for top-down sales pitches — connects them more than traditional barriers, such as ethnicity, divide them.

"Barack Obama is three things you want in a brand: New, different, and attractive. That's as good as it gets."
— Keith Reinhard, DDB Worldwide

Obama has risen above what he calls a "funny" name, an unusual life story, and — contrary to the now popular (and mistaken) notion that nobody sees race anymore — a persistent racial divide to become a reflection of what America will be: a postboomer society. He has moved beyond traditional identity politics. And whether it's now or a decade from now, the new reality he reflects will eventually win out. Any forward-thinking business would be wise to examine the implications of his ascent, from marketing strategies and leadership styles to the future of the American workplace.

COMMAND AND CONTROL

When People Magazine asked a slew of presidential hopefuls late last year what they never leave home without, the answers were revealing. Mitt Romney's choice, homemade granola in his Dora the Explorer bowl, left the blogosphere snickering. Clinton cited her BlackBerry — efficient, businesslike, and an homage to the Web 1.0 world. Obama's response, via his wife, Michelle, was a half-step ahead: a Webcam. "We talk at the end of the day when the girls and I are in Chicago and Barack is out on the road."

Obama has deftly embraced — and been embraced by — the Internet. His campaign has deputized soccer grandmoms and hipsters alike to generate new heights of viral support. And he has been exceptionally successful at converting online clicks into real-world currency: rallies in the heartland, videos on YouTube, and most important, donations and votes.

The question is how. Social networking poses challenges for marketers, no matter what — or whom — they're selling. Traditional top-down messages don't often work in an ecosystem where the masses are in charge. Marketers must cede a certain degree of control over their brands. And that can be terrifying. (Remember that "I got a crush on ... Obama" lip-synched YouTube tribute?)

Yet giving up control online, in the right way, unleashes its own power. And more than any other "national product" to date — and far more than any other presidential candidate — Obama has tapped into that power. The campaign's secret weapon: a fresh-faced 24-year-old named Chris Hughes. Four years ago, he was at Harvard, helping launch Facebook with his roommates, kids named Mark Zuckerberg and Dustin Moskovitz. Just over a year ago, Hughes took a leave from Facebook to do online organizing for Obama. A history and literature major who did no coding at Facebook, he brought with him a mastery of the human side of social networking that has translated into real results for the campaign. Early on, when resources and credibility were in shorter supply, one insider told me, "We were completely focused on making sure that people knew on a very basic level how, where, and why to caucus in Iowa. And a local network, like Facebook, was ideal for that." It was a cheap and effective way to leverage supporters' personal connections.

The campaign's Web site is "far more dynamic than any of the others," says Bentley College professor Christine Williams, who has been studying Web sites and social media in campaigns with her colleague Jeff Gulati. BarackObama.com features constant updates, videos, photos, ringtones, widgets, and events to give supporters a reason to come back to the site. On mybarackobama.com, the campaign's quasi-social network, Obamaniacs can create their own blogs around platform issues, send policy recommendations directly to the campaign, set up their own mini fund-raising site, organize an event, even use a phone-bank widget to get call lists and scripts to tele-canvass from home.

The Obama crew has also tapped into other online communities. "One of our members had excerpted a portion of a Vibe profile of Obama," recalls Kay Madati, vice president of Community Connect, a suite of niche demographic Web sites including blackplanet.com, asianave.com, migente.com, GLEE.com, and faithbase.com. A flurry of discussion drove traffic to BarackObama.com, drawing the attention of Scott Goodstein, who runs the campaign's external Web strategy. He called Madati, who invited all the candidates to create profiles for each of his company's targeted communities. Only the Obama people, Madati says, have created credible presences: "They sometimes update daily; they even update more than Oprah." It has worked. The Obama profile on BlackPlanet has more than 450,000 "friends."

"This is where the Obama campaign has been strategic and smart," says Andrew Rasiej, founder of the Personal Democracy Forum, a Web site that explores how technology is changing politics. "They've made sure the message machine was providing the message where people were already assembled. They've turned themselves into a media organization."

They've also taken advantage of messages created by others. The "Yes We Can" mashup by the Black Eyed Peas' will.i.am, starring a handful of his famous friends, cost the campaign nothing and became a viral hit. By comparison, a Clinton mockumentary called "Hillary's Leaving the Band" — young rockers, clearly actors, lament the loss of their favorite guitar player — fell flat. It seemed ad-agency slick and forced. "It's even easier to reveal inauthenticity in the online world," Bentley's Gulati says. "If it doesn't resonate in the offline world, it won't resonate in the online world."

What's true in politics is no less true in business. "There is a new, authoritative consumer empowered by the Web," says Karen Scholl, a creative director at the digital-advertising agency Resource Interactive. "And they can smell a fake." The agency has coined the term "OPEN brand," an acronym for on-demand, personal, engaging, and networks; it is a framework for companies to think about distributing brand messages in new ways. With Obama, "not only do people feel they know who he is, they feel trusted to share their views," Scholl says. "And they get constant feedback from the campaign and from each other."

"There is a new, authoritative consumer empowered by the Web. And they can smell a fake."
— Karen Scholl, Resource Interactive, a digital ad agency

Being an OPEN brand can be daunting when something as simple as starting a company blog can entail interdepartmental reviews and legal vetting. But, Scholl points out, "you don't have to cede all control, just some." A case in point: the do-it-yourself ads for Doritos during the 2007 Super Bowl. More than 1,000 snack-food fans submitted their entries — but it was Frito-Lay that decided which ones would run.

The Obama campaign plays its own version of this game. The candidate himself has been made available to the press in strictly controlled doses. (The campaign declined requests for a sit-down interview with Fast Company.) And while the Web site may have set the bar high in terms of openness, the campaign still keeps an eye on the imagery and messaging associated with the movement. When supporter Joe Anthony's "BarackObama" fan page on MySpace attracted 160,000 friends, the campaign found itself in a tug-of-war over ownership. Ultimately, MySpace brokered a peace treaty; Anthony gave up the domain name but kept his friends. Obama's emails urging supporters to take action — "Tell the superdelegates what's on your mind," a recent blast implored — are often signed simply "Barack," implying intimacy without risking exposure.

LEADING BY LISTENING

Craig Newmark, the founder of Craigslist, has long considered himself a political independent. An Obama encounter at a campaign event inspired him to take up arms for the Democratic candidate. But he can't quite explain why. "I'm still struggling to articulate what it is about him beyond the issues that I care about," he says. Newmark then fumbles his way to this realization: "I see him as a leader rather than a boss." A leader, he notes, gets people to do things on their own, through inspiration, respect, and trust. "A boss can order you to do things, sure, but you do them because it's part of the contract."

What Newmark is describing is more complicated — and more modern — than it might appear. There have long been leaders who are bosses, and bosses who are leaders. Having a vision and inspiring or instructing others to follow that vision have long been hallmarks of business and politics. But Obama epitomizes a new way of thinking called "adaptive leadership," which is now being taught at Harvard's Kennedy School, among other places. This approach, as Stephen Bouwhuis recently wrote in The Australian Journal of Public Administration, is effective in handling problems that necessitate "a shift ... in ways of thinking across a community." While a visionary puts forth a specific plan to be implemented, an adaptive leader works with constituents to devise one together.

Obama has tapped into this adaptive-leadership vein by inviting voters in with his "Yes we can" slogan, then reinforcing it with attacks on the complacency and withdrawal from politics of many Americans, particularly the young. "Change will not come if we wait for some other person," he said on Super Tuesday, "or if we wait for some other time... We are the hope of the future." Marty Linsky, professor at the Kennedy School and cofounder of Cambridge Leadership Associates, is among those who've taken note of Obama's adaptive style. "Obama often proposes process plans that involve a trust in the community at large," Linsky says. The potential ramifications for business leadership are enormous. The cult of the imperial chief executive officer still reigns in most C-suites and boardrooms. But winning tomorrow's talent — and tomorrow's consumer — may require a dramatically different approach.

And not only to reach the young: Dennis Edwards, a white 50-year-old small-businessman from South Carolina, told me that his main issue in the presidential campaign is health care. "I know that no candidate can push their plan completely through," he says. "That's not cynicism, that's reality. But I believe Obama can get people to the table to talk. I think he'll listen to other points of view. I also believe he can move it further in the right direction than anyone else."

"Obama and Clinton make an interesting contrast in brands," says Professor John Quelch, senior associate dean at Harvard Business School and coauthor of Greater Good: How Good Marketing Makes for Better Democracy. "Obama communicates that he loves people, and Clinton communicates that she loves policy." Consider Starbucks, Quelch says. "People love it for the experience, not for the specifications of the coffee." Obama, through his inclusive Web site and, yes, his lofty rhetoric, reinforces the notion that everyone is included and that this movement is actually a conversation to which everyone is invited.

RACE STILL MATTERS

"The coloration of society is changing." Harriet Michel is president of the National Minority Supplier Council, which helps corporations find qualified Asian, African American, Hispanic, and Native American vendors. When the organization started 35 years ago, Michel continues, "people felt forced to check boxes instead of thinking about how new suppliers might help their businesses." Today, census data make clear that a changing population means new markets and new opportunities. "The 'right thing to do' is tired, quite frankly. It's business," she says. "This is economics. Now when you're talking about imperatives, they accrue to the bottom line of the company."

Michel is an Obama supporter. "The success of his candidacy indicates that we have moved a bit beyond our tortured past as it relates to race," she says. "If he's credentialed enough and experienced enough to be elected by all the people, it will make a difference to how everyone views America and Americans."

The fact that a black man may soon be a major-party nominee, or even sit in the Oval Office, has far-reaching implications for a business community that's still overwhelmingly white at the top. As of 2005, one third of the Fortune 500 had no African-American directors; of 5,572 available seats, 449 were held by 245 black board members. Of course, executive ranks are also overwhelmingly male — 85% of Fortune 500 boards — making Clinton's rise, too, a challenge to the business status quo.

Ariel's Mellody Hobson personifies both of those constituencies. At 38, she is the president of the firm and one of the few women of color in a C-suite. She sits on the board of public companies including Starbucks, Estée Lauder, and DreamWorks Animation, as well as private organizations such as the Sundance Institute, the Chicago Public Library, and the Chicago Public Education Fund. She is a trustee of Princeton University. She is self-made, smart, and outspoken. It's hard not to be impressed, and a little intimidated, by all she has achieved. And yet, she says, "I still feel the bias." Biases are baked into the human condition — "we all have them," she says — but they don't have to be baked into the structure of American business. "We haven't come nearly far enough." Would a black president make a difference? "Yes," she replies without hesitation. "It would send a message. But there is so much more work to do."

Her boss, John Rogers — who played hoops with Obama on Super Tuesday — has been leading some of that work. Rogers cofounded an informal group of black directors of major publicly traded companies in 2002. At that first meeting, about 30 people showed up. "My concern was that African Americans on corporate boards were uncomfortable addressing civil rights issues, and worried about being typecast as a minority member and wouldn't speak up," says Rogers, who sits on the boards of McDonald's and Aon Corp. "If not us, then who will?"

The meeting, which has become the annual Black Corporate Directors Conference, now attracts more than 100 business bigwigs and last year featured Time Warner's Dick Parsons and Wal-Mart's Lee Scott, along with CNN's Soledad O'Brien as moderator. The group spends a good deal of time talking about the distinction between being a black board member and a board member who happens to be black. Rogers explains: When you are in the room, do you shortchange your fiduciary duties by advocating for diversity? "Diversity benefits the bottom line substantially, for all sorts of reasons," he says. "But it also takes years to establish a culture, with all the benefits that come with that. If there is only an immediate business imperative, then you might end up creating expectations that might not be met."

Tory Clarke, who is British, and Larry Griffin, an African American, have heard these debates for years. As the founders of Bridge Partners, a boutique executive-search firm that specializes in placing minority candidates at senior levels, "we've seen the shift from a quota mind-set to a business case mind-set," says Clarke. "Now we hear very specific requests — we want a Latino male or an African-American female — specifically so our clients can better approach a particular market, or solve a problem with a particular community." They cite the recent election of Avon CEO Andrea Jung to the Apple board — its sole Asian and only its second woman. Business acumen aside, Jung offers a direct conduit to millions of female customers, a segment that Apple would dearly love to exploit. She also speaks fluent Mandarin, a plus for a company that has just invested $40 million in its first store in Beijing.

Both Griffin and Clarke acknowledge that minority representation at the upper echelons of business remains "abysmal." As a result, Griffin explains, the closer minority hires get to the corner office or the boardroom, the more they become symbols. Even people recruited for their legal or financial expertise may be pressed to become what Griffin calls "internal brands." "They may be asked to show up at campus recruiting events, or take a more public-facing role than they are prepared for," he says.

While some observers hoped the Sarbanes-Oxley provision calling on companies to seek out new independent board members would bring about more change, progress has been slow. But with census data projecting that 40% of Americans will be nonwhite by 2010, business leaders who are charged with inspiring and attracting the best talent and satisfying an increasingly diverse pool of shareholders may soon find that diversity is a business imperative.

BRAND AMERICA

Should Obama become president, his leadership style — not to mention his brown skin and African name — could give a new face to the image America telegraphs to the rest of the world. "It's already made a difference that a minority could rise this far through the democratic process," asserts Harvard's Quelch.

"It's already made a difference that a minority could rise this far through the democratic process."
— John Quelch,Harvard Business School

That brand U.S.A. has suffered in recent years is indisputable. According to the Pew Charitable Trust Global Attitudes Survey, updated in the spring of 2007, the country's favorable ratings have declined over the past five years in 26 of 33 countries — including most of our European allies — and are particularly negative in the Middle East. A BBC International poll from 2007 is even more dismaying: A survey of 26,000 people in 25 countries shows that three out of four disapprove of how the United States is dealing with Iraq, Guantanamo, global warming, Iran, and North Korea.

"It's a constant discussion point in international business," says Keith Reinhard, whose DDB Worldwide has offices in 99 countries and has been the steward of such premier global brands as Hasbro and Anheuser-Busch. "We're seen as culturally insensitive on a personal level, and on a corporate brand level," he says. Determined to do something about it, Reinhard dipped into his own pocket in 2002 and started Business for Diplomatic Action, a coalition of marketing, political science, and media professionals aimed at improving the standing of America in the world through business outreach. (He has scaled back his work at DDB to work for the coalition full time.) After commissioning research and testifying before Congress, Reinhard can distill his advice to brands to one word: Listen. "Everywhere I go, from CEOs to people on the street, I hear the same thing," Reinhard told me as he rushed between conferences in Frankfurt, Germany, and Doha, Qatar. "The U.S. needs to listen to the world."

This is precisely the strategy that Obama professes in international relations: to engage, even with countries that have been viewed as America's enemies — in much the same way that businesses from McDonald's to ExxonMobil often find themselves engaging in places where regimes are not necessarily to their liking. Obama's strategy is not one that all geopolitical experts agree with, but it is consistent with how American business has conducted itself. It is also consistent with his criticism at home of what he terms "a politics that says it's okay to demonize your political opponents when we should be coming together to solve problems."

Obama's candidacy and its call for change may already be resonating in countries that have lamented U.S. policy but still want to believe in the promise of American leadership. "That Obama exists has already begun to recalibrate the way the world sees us," Reinhard contends. "This is a good thing."

"LOOKING FOR A CHANGE"

Sitting at the bar in the Chicago Hyatt on Super Tuesday, I scarfed a burger before rejoining the Obama press circus. My 24-year-old waiter seemed bored by the chaos, but took some time to admire my iPhone and chat. He'd known only a Clinton or Bush in the White House, he said. "I'm sort of looking for a change." Then he caught sight of Obama on CNN over my shoulder, tossed his dreadlocks, and smiled. "But that guy," he patted his chest, "he makes me believe."

Barack Obama may not win his party's nomination. And even if he is nominated, he may lose at the polls. If that happens, pundits will be quick to point out strategic or tactical missteps, and some will say America just isn't ready to elect a black man as president. Such a pat analysis is to be expected. But there is no question that the brand of Obama — what he represents to the next generation of Americans — is important. A business that ignores this message does so at its own peril.

A version of this article appeared in the April 2008 issue of Fast Company magazine.