What Great Brands Do

A great brand is hard to find. "I walked through a hardware store last night and I came across 50 brands I didn't know existed," says Scott Bedbury. "They may be great products, but they're not great brands."

Bedbury should know -- he's already working on his second great brand. As senior vice president of marketing at Starbucks Coffee Co., Bedbury, 39, is responsible for growing the $700 million Seattle-based company into a global brand. Since Bedbury joined Starbucks in 1995, the company has been on a branding blitz: beginning a relationship with United Airlines to serve Starbucks on all United flights; joining with Redhook Ale Brewery Inc. to introduce Double Black Stout, a malt beer flavored with coffee; venturing with Pepsi-Cola Co. to market Starbucks's Frappuccino drink in supermarkets; joining with Dreyer's Grand Ice Cream to introduce six flavors of Starbucks Ice Cream; opening its first retail stores in Tokyo and Singapore, with 10 more to follow in each market; expanding the Starbucks stores to 1,100 outlets with 22,000 employees; and serving coffee to 4 million people each week.

Building the Starbucks brand, however, is deja vu for Bedbury: his first great brand was Nike Inc. When he joined the Beaverton, Oregon-based footwear and apparel company in 1987, Nike was a $750 million business; when he left seven years later, Nike was a $4 billion business. In between Bedbury directed Nike's worldwide advertising efforts and broke the "Just Do It" branding campaign. "I can honestly say that Nike left its imprint on me in ways I never thought possible," Bedbury says, "largely because of the strength of the Nike culture."

Whether the product is sneakers, coffee -- or a brand called You -- building a great brand depends on knowing the right principles. Fast Company asked Bedbury to identify his eight brand-building principles.

1. A great brand is in it for the long haul.

For decades we had great brands based on solid value propositions -- they'd established their worth in the consumer's mind. Then in the 1980s and 1990s, a lot of companies sold out their brands. They stopped building them and started harvesting them. They focused on short-term economic returns, dressed up the bottom line, and diminished their investment in longer-term brand-building programs. As a result, there were a lot of products with very little differentiation. All the consumers saw was who had the lowest price -- which is not a profitable place for any brand to be.

Then came Marlboro Friday and the Marlboro Man fell off his horse. Today brands are back stronger than ever. In an age of accelerating product proliferation, enormous customer choice, and growing clutter and clamor in the marketplace, a great brand is a necessity, not a luxury. If you take a long-term approach, a great brand can travel worldwide, transcend cultural barriers, speak to multiple consumer segments simultaneously, create economies of scale, and let you operate at the higher end of the positioning spectrum -- where you can earn solid margins over the long term.

2. A great brand can be anything.

Some categories may lend themselves to branding better than others, but anything is brandable. Nike, for example, is leveraging the deep emotional connection that people have with sports and fitness. With Starbucks, we see how coffee has woven itself into the fabric of people's lives, and that's our opportunity for emotional leverage. Almost any product offers an opportunity to create a frame of mind that's unique. Almost any product can transcend the boundaries of its narrow category.

Intel is a case study in branding. I doubt that most people who own a computer know what Intel processors do, how they work, or why they are superior to their competition in any substantive way. All they know is that they want to own a computer with "Intel inside." As a result, Andy Grove and his team sit today with a great product and a powerful brand.

3. A great brand knows itself.

Anyone who wants to build a great brand first has to understand who they are. You don't do this by getting a bunch of executive schmucks in a room so they can reach some consensus on what they think the brand means. Because whatever they come up with is probably going to be inconsistent with the way most consumers perceive the brand. The real starting point is to go out to consumers and find out what they like or dislike about the brand and what they associate as the very core of the brand concept.

Now that's a fairly conventional formula -- and it does have a risk: if you follow that approach all the way, you'll end up with a narrowly focused brand. To keep a brand alive over the long haul, to keep it vital, you've got to do something new, something unexpected. It has to be related to the brand's core position. But every once in a while you have to strike out in a new direction, surprise the consumer, add a new dimension to the brand, and reenergize it.

Of course, the other side of the coin is true as well: a great brand that knows itself also uses that knowledge to decide what not to do. At Starbucks, for instance, we were approached by a very large company that wanted to partner with us to create a coffee liquor. I'm sure Starbucks could go in and wreak havoc in that category. But we didn't feel it was right for the brand now. We didn't do a lot of research. We just reached inside and asked ourselves, "Does this feel right?" It didn't. It wasn't true to who we are right now.