COMBATING YOUR INDUSTRY BRAND
The challenges of protecting your corporate brand in the Defense Industry.
Apple, Microsoft, Disney, Amazon, and Nike are brands that we all recognize. For most of these companies we can easily identify what it is that either appeals to us or, conversely, what we may not like about them. We are either ambivalent, with no strong feelings one way or the other, are a detractor, or are a loyal advocate. That is the power of branding.
Branding, however, is not the sole domain of corporations and products. Industries are brands too.
An industry might not have its own logo, tag line or the other more traditional trappings of a brand. An industry is subject to impressions that are associated with it that have been created over time through what we hear, see, or experience with it. This experience forms what we believe the industry is best known for. In this sense it is very much like a brand.
When someone makes reference to the financial or healthcare industry what impression comes to mind? Whatever that impression is, positive or negative, it is what constitutes the brand character of that industry not unlike how you might think of Target, Walmart or any other consumer brand. The defense industry is no different. Customers, investors, and the public have all formed an opinion as to what characterizes the defense industry brand although they may not consciously think of it that way. Understanding the perceptions associated with any kind of brand is the first step to managing it, protecting it or, in the case of an industry brand, leveraging it or positioning against it.
Brand Perceptions. In the 2016 FutureBrand Index¹ ranking of the top 100 global companies, Apple ranked number one across 18 different attributes including innovation, authenticity, personality and trust. The same study averaged the perceptions across different industry sectors. Technology ranked the highest with oil and gas ranking the lowest. Industrials (which includes companies like Boeing and GE who work in the defense sector) fell about in the middle. The key perceptual strengths for Industrials were innovation, purpose, indispensability, trust, and authenticity. Not necessarily representative of the defense industry, it still provides a glimpse of what people might think about it.
Does the Defense Industry sound like a trustworthy indispensable purpose driven innovative brand?
For some people that might not seem like a totally accurate representation of the industry. That is because the perceptions of an industry goes far beyond a handful of prominent brands in the category. Industry perceptions are built over time across prevailing public impressions of many companies and the publicity they receive. Unfortunately, bad publicity generally overshadows the good just like bad news is what dominates headlines. The auto and financial industries are good examples of how the misdeeds of some brands cast a shadow over an entire industry. The defense industry has been particularly vulnerable to prevalent negative perceptions.
Budget Overruns + Delays. Cost overruns, setbacks, and delays might be one of the most incessant perceptions associated with the defense industry. According to the Government Accountability Office 2016 Report², three key programs (F-35, DDG51 Guided Missile Destroyer, and Evolved Expendable Launch Vehicle) were over budget by 48%, 619%, and 221% respectively representing billions of dollars and untold delays.
Honesty + Integrity. The defense industry is heavily reliant on lobbying. The Department of Defense and Homeland Security are its biggest customers. Policy decisions made by the administration, congress and the Pentagon determine what they can sell and to whom. According to the Center for Responsive Politics³, defense is one of the most lobbying-intensive industries in the U.S. “Over a 10 year period its share of lobbying was 6.9 times greater than its share of the economy”. While the practice of lobbying is the price of doing business it is also something that has created negative impressions that has cast a shadow over the industry. According to a Gallup poll on honesty and ethics⁴, only 5% of the respondents in the study ranked lobbying high on honesty and ethics. Lobbying was at the very bottom of all other professions.
Is the defense industry brand defined by impressions of inefficiency, unaccountability, and untrustworthiness?
Although these might be strong influencers on the industry brand it would be unfair to simply label the industry in these negative terms alone. In fact there was a time not long ago that the industry was best known for innovation.
The frustrating part of branding is that the perceptions of a brand are created in the minds of its customers and the public. These perceptions are not necessarily true reflections of reality. Not only may they be an untrue indicator of the industry, they may have nothing to do with individual corporate brands.
Perception is not necessarily reality but managing them is a definite reality.
Brands are customarily positioned against competitor brands to ensure there is clear competitive differentiation. What do you do when you inherit industry perceptions that are in conflict with your own brand?
Negative industry perceptions can be an opportunity for differentiation.
All companies in an industry share the same attributes in some form, both positive and negative. This provides an opportunity to position the brand against the negative perceptions or leverage the positive ones.
- Position Against Industry Weaknesses. The defense industry is plagued with two bothersome perceptions: a poor reputation for staying on budget and staying on schedule, and questions of honesty and integrity. These perceptions may be true or not but they are prominent perceptions nonetheless. To emphasize the positive attributes it means applying extra effort to reinforce efficiency, reliability, trust, transparency, and ethics. These positive characteristics need to be imbedded into a broader messaging and communication strategy as well as the behavior in the way business is conducted. It can’t be just a tagline.
- Build on Industry Strengths. The defense industry has historically been known for innovation although some would argue that it has lost this edge. Connecting with and reinforcing the positive attributes of the industry’s heritage would be one way to strengthen a corporate brand. Another opportunity would be to leverage the positive attributes of key customer segments through association. In a study conducted by Pew Research Center⁵ it found that: “79% of Americans have confidence in the military as acting in the best interests of the public and adding a lot to society”.
Striking the Right Balance. It is important to protect your brand from industry characteristics that might negatively reflect on your own brand. However, it is equally important to ensure that you are still a player in the category. You don’t want to position against the industry so far that you are not considered to still be in the industry. Striking the right balance to overcome some of the negatives while building on the positives is what will help establish a reputation for a long sustainable BrandLife.