Service brands must shape reality, not build branding fantasies

The difference between service brands and product brands can be big or small depending on how you choose to see it. For instance, both have a brand identity, put forth a brand experience and use marketing communications. Yet the approach to making these two types of brands successful is radically different. According to Stuart, marketing product brands involves shaping fantasy, while marketing service brands involves shaping reality. 

For mainstream products, packaging is an essential point of differentiation. “If you compare Australia and the UK’s Cadbury to America’s Hershey’s chocolate without the wrappers, they’re very similar,” said Stuart. “People know the differences aren’t true, but they start buying into the messaging and dramatisation of an idea and emotion. The same goes for beer and cooking oils.”

Stuart started his career with Saatchi & Saatchi in what he called the “boom days” of the 1980s, working on FMCG accounts. In the second half of the 20^th century, the biggest advertising agencies recognised the business opportunity for service brands as this sector grew. Agencies were keen to apply the same techniques they’d used to advertise products. It was during this time that Stuart worked on airlines, banks and other service brands.   

“The biggest problem with advertising in this context is the gap created between the brand promise to customers and the actual service experience,” said Stuart. “There’s a fundamental ethical issue when a service business does one thing and says another.”

Recognising the disconnect early on, Stuart became dissatisfied with the advertising paradigm as it was being applied to service brands. He came across an article called “Brand building in the 1990s” by WPP’s Stephen King.  (“Not the author of horror fiction,” Stuart added, laughing.)

King’s thesis argued that the increasing difficulty to sustain an objective comparative advantage over one's competitors meant that organisations needed to position themselves as living “brands” in the minds of actual and potential customers.

The article served as initial inspiration that eventually led Stuart deeper into his work with service brands. “The article was on the money, but it wasn’t being adopted either. It was ahead of its time.”

Seeing the growth and potential of the service economy in Asia, Stuart moved from the UK to Hong Kong, where he joined Hong Kong Telecom to help build the brand. During this time he also travelled around the world to study brands such as General Electric, Ford, Singapore Airlines and McDonald’s.

“What enlightened and successful brands told me was that the CEO must be the chief brand officer,” said Stuart. Armed with this notion, he eventually experienced a “difference of opinion” and left Hong Kong Telecom. “Heads of marketing don’t want to say the CEO is the chief brand officer. They kicked me out.”

Stuart sat in a bar shortly after and thought about what to do next. “I hated corporate life but I’d been through marketing and advertising,” he said. “I had this idea of brand-centred management and wanted to focus on hospitality brands.”

Brand-centred management addresses the disconnect between marketing communications and the actual experience with a service brand. It’s a key model in his work and business. The only way to make a service brand consistent is to “organise the brand by the organisational way of life”.

“Let’s just say Boring Co proposes that a brand is fun and lively,” said Stuart. “It’s not going to be real or effective unless the brand or organisation hires people that actually have those attributes.”

Stuart co-founded The Brand Company in 2002. It was a difficult start. He worked from home and spent six months without any work on his desk. “It was a very sobering experience with two kids,” he said. The challenge lay in the fact that the entire premise of his firm seemed less tangible than traditional ad agencies, which typically had a finished campaign to show for. His approach was against the norm. And in some ways it still is.   

Even now, The Brand Company’s website doesn’t feature case studies, as the work the company does “is not what clients would like to reveal.” Stuart’s Hong Kong-based brand management and creative consultancy has worked with clients in the hospitality and travel sectors across Greater China, South Korea, Japan, Southeast Asia, Russia and East Africa.

Rather than focus on service brands broadly, Stuart has found his calling in hotel brands. “It’s a niche, but a very big one,” said Stuart. “There are opportunities to do good work. If you look at Interbrand’s top 100 brands, you won’t find a single hotel in there. Now why is that?” Stuart asked.

Some of The Brand Company’s hotel projects have included: Upper House, Hong Kong; Opposite House, Beijing; Ad Lib, Bangkok; The Langham Place, Worldwide; The Peninsula, Hong Kong; East, Hong Kong, Beijing, Miami; Thanyapura, Phuket; and Shangri-La Hotels, worldwide.

Away from the mainstream, his clients include wealthy independent Asian families across the region, which typically have a core family business in a different industry. The new generations of these families have been drawn towards creating “imaginative and unusual” property and hospitality projects, fuelling a new wave of boutique hotels in the Asia-Pacific.

With 15 years' experience working with both well-established and startup hotel brands, Stuart contends that the issue with many hotels is that product is seen as more important than the brand. The consequence is that hotels rely on their facilities and physical elements for promotion. Luxury hotel brands in particular concentrate on status, glitz and elitism as a unique selling point.

“Customers don’t give a shit after it reaches a certain level of quality,” said Stuart. “There’s no point saying the Ritz Carlton is better than the Mandarin Oriental. If you stay in a Sheraton, Hilton, or Marriot and you take down the signage, would you be able to tell the difference?”

While an advertisement, campaign, or identity can “get you in the door”, it won’t attract repeat business. “When was the last time you got someone back to a hotel because of its logo?” said Stuart.

According to one school of thought, hotel brands can be grouped into broad categories: “luxurious, trendy, boutique, lifestyle, generic.” In order to avoid the pitfalls of positioning, Stuart believes further steps need to be taken, as this traditional marketing approach is an incomplete answer for hospitality brands.

The thinking comes down to a key ingredient: people. Stuart’s inspiration for this idea comes from Jack Welch, former CEO and chairman of General Electric. Welch had outlined four types of managers. The best type shares the company’s values and makes “the figures for the business”. The second best type shares the values, doesn’t make the figures and deserves a few chances. The third type doesn’t share the values and doesn’t make the numbers — they can be dismissed. The fourth type is the most difficult because they make the figures but don’t share the values.

Welch held that this last type is the worst because these people have the power to single-handedly ruin the unique culture that the business needs to be successful in the long run. Although the idea of letting these managers go seems counter-intuitive because they still get the job done, Welch believes it’s in the true interest of the brand and its people.

Extending this concept, Stuart has designed a unique approach. As part of a holistic branding strategy, he develops human resource and recruitment plans as well as performance management systems for hotels. These HR initiatives align with the brand’s organisational characteristics and operations in order to help hotels elevate their businesses from the inside out.

“The whole idea that a branding firm can sniff in the same space as an HR director seems preposterous,” said Stuart. But this is what The Brand Company does. In a notable project, Stuart worked with managing director Brian Williams, who leads the development of new hotel brands for Swire Properties.

“Brian didn’t want to hire any architects or anyone until ‘who we are’ was crystal clear,” said Stuart. The task was to build the hotel brand from the ground up, which later included recruitment.

“We put out a job ad that asked people to be spontaneous without any mention of hotels,” said Stuart, highlighting their search for “character” instead of just a set of skills. “Even our application form wasn’t typical. It was more like a conversation between us and them.” The team received 700 applications within a day. A group interview session was arranged and the candidates didn’t know what to expect.

The 30-minute session was framed as a kind of theatre performance. Candidates were simply asked to “make the half hour the most productive” and have a bit of fun. “People were putting their hand up and asking ‘what do you want me to do?’ while others freaked out,” said Stuart. “But there were also people who had this light-bulb come on and they just ran with it and realised they needed to be spontaneous.”

After candidates were hired with their character traits high on the priority list, there was on-going coaching to help employees be themselves. “You need to break down preconceived ideas and be yourself. You need to question things,” said Stuart. “Why do people wear ties?”

Employee performance is measured not only against tangible results but also for their support for organisational culture. Instead of a Myer-Briggs approach that narrows down to a particular set of traits, a 360-degree evaluation is conducted. This involves evaluations from the employee’s superior, co-workers on the same level, and subordinates. These steps reflect the individual more accurately and align the brand with employees.

“You can bring in a fancy designer from Amsterdam and they’ll go crazy,” said Stuart. “But if you’re not designing and finding people that are based on the brand core, how is the whole thing going to be consistent?”

The human-centred approach allows hotels to “keep the promises they make to customers” and put “distinctiveness into every aspect of the guest experience”. All of this goes back to what modern hotel customers are seeking from today’s hotel experiences.

“Asia’s wealthy are worldly, educated and dislike pretentions,” Stuart said. “They also have very little in common with 19^th century-style pompous hotels. They want to feel like they’re at home and not surrounded by people who act like slaves.”

Stuart’s book, Hotel Brand Bites is a compilation of 24 ‘Living Brand’ articles originally published in the Bangkok Post. The chapters feature sharp observations written in Stuart’s distinctive voice and sense of humour. The book offers guidance to entrepreneurs, marketers, and advertisers interested in crafting hospitality brands.

Self-aware, Stuart realises his ideas run contrary to the advertising models used in traditional agencies as well as the hotel management paradigms taught at famous hospitality schools like Cornell. For Stuart, the cover and inner page of Hotel Brand Bites summarises the sentiment well: a funny-looking penguin on a bicycle riding in the opposite direction to a sea of other penguins.

“I’m probably an annoying little mosquito on the back of big hotel groups, and advertising people might throw up if they read my book,” said Stuart. “But my purpose is not to antagonise. I just want to get people thinking about service brands, and for God’s sake don’t make the same mistakes.”

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Stuart discusses the brand-centered management model

Objectives & Strategies: too many organisations have objectives and strategies that are at odds with the Brand Core as they see the brand as a separate entity, not a unifying force for all that the organisation does and the way it does it. The goals and strategies must be constructed with the brand in mind, otherwise there will be too many opposing forces within the organisation to allow the brand to flourish (which, if one believes that the brand is the most sustainable point of competitive differentiation, would be something of a disaster).

Systems & Policies: You have to create an appropriate environment within which the desired organisational way of life (culture) can flourish. This covers operational systems, policies, the way meetings are conducted, the office interiors, the organisational structure etc.

Mindset & Behaviours: There’s no point in trying to create Brand Type A if you have an Organisational Type Z. The way in which the team works must be bound by a common (brand-led) approach to the way it thinks about and delivers what it does. This mindset will bind the team into a more effective whole and make it far more likely that the brand will be delivered consistently to customers, as the people in the organisation will be thinking in a naturally brand-centered way (especially if they have been hired, in part, on the attributes that are derived from The Brand Core).

The Brand & The Customer

• People: The service attitude of the customer-facing teams
• Product: The distinct flavour of F&B, entertainment, business facilities, leisure facilities etc.
• Process: The nature of check-in, check-out, reservations, complaints handling etc.
• Property: The style of architectural, interior and landscape design, plus lighting, aromas, botanicals, art & sculpture etc.
• Packaging: The personality exuded by naming, logomarks, visual identity systems etc.
• Promotion: The reflection and dramatisation of the unique truths delivered by the reality of the brand experience
• Place: Locations that add support to the unique spirit of the brand