Happy Holidays from Brand Strategy

As we are hurtling headlong into the holiday season, Brand Strategy would like to take the opportunity to say ‘Happy holidays’ to all our blog readers. Thank you for taking the time to visit us and we look forward to bringing you more news, views, ideas and trends next year.

The team is currently travelling all over the world so our blogs may be less frequent until early January but in the meantime, if you are getting in the Christmas spirit, you can try out some of the viral games we’ve been sent here to pass the time until we’re back.

Or you can enjoy the antics of what is allegedly a Wal-Mart Xmas party featuring line dancing:

The global top 1000 innovators 2006

Our friends at Booz Allen Hamilton have published a great report on the Global Innovation 1000. Now in its second year, this survey attempts to identify the common themes across the international businesses that spend most on research and development while analysing their success.

Some of the most prominent themes from this year’s report:

• Deep pockets can be dry wells. Analysis of the 2005 Global Innovation 1000 confirms the major finding from the initial study last year: money simply cannot buy effective innovation. There are no significant statistical relationships between R&D spending and the primary measures of financial or corporate success: sales and earnings growth, gross and operating profitability, market capitalization growth, and total shareholder returns. Gross profits as a percentage of sales is the single performance variable with a statistical relationship to R&D spending.

• Less than 10 percent of companies are high-leverage innovators. Compared with others in their industries, only 94 of the companies in the Global Innovation 1000 produced significantly better performance per R&D dollar over a sustained period.

• Companies are getting better at squeezing benefits from R&D spending. R&D spending by the Global Innovation 1000 rose last year by more than $20 billion, but revenues rose more.

• Bigger can be better, even if it doesn’t boost breakthroughs. Scale provides advantages to R&D spenders. For the largest 500 companies, ranked by revenue and indexed by industry, median R&D spending was only 3.5 percent of sales in 2005, compared with 7.6 percent for the 500 smallest firms.

• Patents generally don’t drive profits. Boosting R&D spending can increase the number of patents that a company controls, but there is no statistical relationship between the number or even the quality of patents and overall financial performance.

• Masters of the innovation value chain have an edge. The high-leverage innovators and the companies with best overall performance distinguish themselves not by the money they spend, but by the capabilities they demonstrate in ideation, project selection, development, or commercialization.

You can read the full report online (complete with tables and statistics) here.

You can download the full report in PDF format here.

You couldn’t make it up – or could you?

Thank you to the BBC ‘One Hundred Things We Didn’t Know…’ which gave us this gem:

“The Japanese word “chokuegambo” describes the wish that there were more designer-brand shops on a given street.”

Brilliant. What’s the English equivalent? I don’t think you could find one.

Do you know any other fantastic brand-related phrases from other languages? Let us know.

Gaining and losing with the global company rankings

Barclays bank, Hilton hotels and Deutsche Post have all joined the FTSE CNBC Global 300 index. Motorola, Kellogg and Capital One are among those companies that have fallen out of the ranking on this occasion.

The FTSE CNBC Global 300 Index comprises the largest 15 companies by market capitalisation from each key industry, plus the 30 largest companies from emerging markets to make a total of 300 firms.

Geographically, Japan lost six constituents and the United States four, but the US remains the index’s largest weighting at 51.43%. The largest gainer was Germany, which increased its weighting in the Index to 4.35%. The UK increased its weighting to 11.86%.

For more tables and information about the index and companies involved, read on…

X-Factor merchandise sings for consumers

The X-Factor brand (it’s a TV singing talent show based in the UK that has gained worldwide attention) has extended itself into publishing for the first time. It will produce a glossy coffee table book with highlights from all three series.

The brand has also created an experiential game booth with Eclipse Games. This will appear in shopping centres and users can choose to sign songs in front of graphics from the show. They can then take away a DVD of their performance and receive ratings.

Other merchandise includes a dance mat, disco ball, tabletop game, slot machine and karaoke machines.

Mouse rage hits holiday shoppers

Apparently, nothing is safe around the holiday season. We’re always hearing that Christmas can bring on high suicide rates, depression and stress but apparently online shopping for the season is also pretty hairy.

Shopping on badly designed websites “could have a negative effect on the immune system, cardio functioning and nervous system”, according to a report published by the Social Issues Research Centre and Rackspace Managed Hosting.

The study, which examined brainwaves, heart-rate fluctuations, muscle tension and skin conductivity among internet users has lead to the creation of the term ‘mouse rage’.

The study combined data from a YouGov poll of 2,500 people with physiological tests on a separate sample of internet users, who were asked to find information from a number of different websites. The tests measured the physical and physiological reactions to website experiences.

The report said that when participants came to ‘problem’ websites: “Some changes in muscle tension were quite dramatic…While this was happening, the participants’ faces also tensed visibly, with the teeth clenched together and the muscles around the mouth becoming taught. These are physically uncomfortable situations that reduce concentration and increase feelings of anger.”

According to the report:

The first signs of Mouse Rage:

• Heart rate quickens

• Increased sweating

• Furious clicking of the mouse

• Simultaneous clicking and cursing the screen

• Bashing the mouse

The Top 5 Causes of Mouse Rage:

• Slow to load pages

• Confusing / difficult to navigate layouts

• Excessive pop-ups

• Unnecessary advertising

• Site unavailability

Brands take note – is your website promoting ‘mouse rage’?

Why Turkish Airlines got the hump

It’s not the most serious business story of the day but it’s certainly the strangest. Turkish Airlines has allegedly suspended the boss of some maintenance workers who clubbed together and sacrificed a camel at Istanbul International Airport. The sacrifice was apparently to mark the final delivery of 100 aircraft.

Now we’re all in favour of loving your job and boosting the internal brand through employees clubbing together and celebrating, but this really does seem to go a step too far. You can hardly imagine the British Airways boardroom getting together and slaughtering a cow to celebrate their million passenger getting on board….

Perhaps this is just one of these interesting cases where traditional practices (such as animal sacrifice) collide head-on with capitalist consumerism (a modern airline). It is not something the brand particularly wants to be associated with but the reality is that most workers are not thinking about ‘the brand’ first and foremost. They are just getting on with their jobs and reacting to events as they see fit. Camel meat is eaten in Turkey so it is no great surprise that employees wanted to celebrate in a traditional way – even if it turns the stomachs of international passengers.

I think it’s pretty safe to say that there may be some serious internal branding exercises at Turkish Airlines over the next few months. Well, we suppose it’s that or just adding camel to the aircraft menus and letting everyone share in the fun….

The Visa-Fifa row plays on…

The Visa and Fifa row is showing no signs of going away quietly. A court earlier this week ruled that Visa could not sponsor Fifa events because a deal with incumbent Mastercard gave the latter brand first refusal for future tie-ups. Mastercard argued that they had not been given this chance.

Now Fifa has ‘parted company’ with four employees involved in the Visa deal – Jerome Valcke, the director of marketing and TV and three colleagues: Tom Houseman, Robert Lampman and Stefan Schuster. While the organisation claimed that the judge was biased towards Mastercard, it acknowledged that the Fifa employees had broken the brand’s ‘business principles’.

So what now for Fifa? Has the brand been tarnished by this court case? It certainly seems a worrying way to treat a partner if the whole point of these extremely expensive sponsorships is to form a brand relationship at the highest level. How will these two brands work together now?

Shell suggests some retirement plans for Schumacher

Oil giant Shell’s three virals to capitalise on the retirement of Michael Schumacher from Formula One driving have apparently garnered more than 1 million online views. Which was the only excuse we needed to bring them to you here today.

Shell is technical partners with Schumacher’s driving team Ferrari and the clips were created by PRISM. The spots are designed to suggest how the German might spend his time once his driving career is over….

You can see the ads by reading on…

The search engine wars

The Scobleizer blog has an interesting article about a PR headache for Google regarding whether someone copied a page from rival Yahoo….and because of the wonders of the worldwide web, a blogger for Google has even replied!

We at Brand Strategy love the search engine wars – it’s like the cola wars but online so there is instant gratification. Check out the whole saga here.