Archives for posts with tag: brand

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Our knowledge and understanding of the human brain has dramatically increased in the last few decades. We have come to learn that our behavior is mainly driven by emotion, not by rational decision-making processes.

Any modern psychology literature never uses the words ‘human’ and ‘rational’ in the same sentence. However, in the marketing world we still believe human beings are rational. They process through purchase funnels, rational triggers will change their behavior, whole campaigns are designed around the false construct of rational, human behavior.

It’s time to throw the idea of rational humans in the trash.

Let’s face it: We are emotional and social creatures. Even the head of chemistry at your closest college is. The head of IT. Everyone one of us is an emotional and social being. All our decisions are emotional, we just justify them rationally. That’s why focus groups are such a nonsense: We are incredibly good in making up stories to explain behavior. It’s not an outright lie. We just don’t know ourselves why we act the way we do. We don’t have the key to access the real reason behind our behavior – the subconscious mind.

We still focus on distinguishing between rational and emotional factors in communication development.

We act as if our two brain hemispheres are two brains: one is the emotional side, the other one the rational part. And we believe that emotion translates into brand affinity and rational factors into the final purchase decision. That’s why we get bombarded all day long with rational messages. Messages that don’t connect with us on a human basis.

And while we duck and dive, hide from snipers we call commercials and IEDs we call disruptive messages, we are longing for meaning. We’re starved for meaning.

This is an opportunity for brands that understand this reality and dare to be different.

People wants something different, something that stands out, connects with us, moves us and inspires us. While we see an advent in the art of storytelling, advertising is increasingly dominated by quants and algorithms. It’s almost impossible to tell a good story when the quants are trying to run the show.

A good story is always true.

We all want a good story to be true. That’s why gossip, rumors and conspiracy theories spread so quickly.

Stories don’t need proof of verification. When a story is well told, communicates inspiration and is interesting, it gains credibility and authenticity over time. We don’t question good stories, we love to listen to them and are saddened when they end. Just to hear more good stories.

Brand story telling requires time and continuity.

And it requires commitment, dedication and a long-term view. For most brands it means they have to break out of the rationality restraint and develop evocative and engaging stories based on brand philosophy and belief.

A great story takes time to unfold. You can’t fully enjoy “War and Peace” without reading the first 200 pages. Brands need to be willing to show the same patience while their brand story unfolds. Communicate cues that will come to a conclusion over time. All the clues, characters and chapters create a meaning we all so desperately seek. When we find meaning, it fills us with a sense of fulfillment and connects us closer to a brand. That’s what brands should be doing now.

What does it take?

Courage.

The courage to be honest with ourselves.

We’re not rational beings.

We’re emotional creatures.

Our industry has to move away from our obsession to hold onto logic and reason.

Let’s show some real courage.

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I’ve met with a few CMO‘s and agency heads in the last few weeks and was astonished how painful relationships between agencies and brands have become. This is not just a feeling, it’s a major data point in a survey released by RSW/US: A client’s look ahead at agencies.

I do recommend downloading the free report but in case you’re pressed for time, here are two facts that caught my eye:

– Only 55% of marketers state they would consider using their primary agency again if they were to put up their account for their review.

– A marketer‘s tendency to look for a new firm is driven by general lack of satisfaction with an agency’s creative, their strategic thinking, or their general lack of proactivity. (…) “…”lack of proactivity” was one of the primary reasons given for finding a better agency partner. They were with a much larger firm and felt, because of their “small fish in a big pond” status, they weren’t getting the attention they needed – resulting in their desire to look for a mid-size Agency to better serve them.

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The challenge for agencies

When the first agents appeared, the mission was very clear: Purchase advertising space on billboards/print on behalf of businesses.

Over time, brands wanted more: produce remarkable advertising that increases sales. To answer that demand, agents started to hire illustrators and copywriters. They transformed into agencies. And customers became clients. This hasn’t changed much over the decades.

The objectives of clients changed dramatically. It used to be enough to produce advertising that produces sales. We give you a coupon, you buy the product. You get an invite to test-drive a car, you head to the showroom.

The market changed over time. Everything became more complex and complicated – more brands, more media, more channels. Suddenly, you had to spend more to get some kind of lift. The placement game turned into an arms race.

No matter what: Clients still want to see increased sales. As they should.

Unfortunately, it’s complicated. In the old days, the guy with $20 to spend on advertising sold more than the guy with $1 for advertising. The ability to track results against communications activities has become diffuse. A campaign lives in too many channels, the desire to differentiate now means that there might be no direct, trackable call to action and the complex economic structure (pricing, distribution, competition, economic climate, etc.) cause signal interference for brands that advertise widely, sell multiple product lines, distribute through multiple sales channels, and face many competitors.

The complexity can be overwhelming

Clients have to muddle through this complexity and they don’t feel very empathetic when advertising agencies are not ready to join them through this struggle. On the contrary, the report suggests that clients feel a great deal of disappointment and bitterness about the failure of agencies to help them guide through complexity, while still delivering obvious, measurable results.

What agencies have to fix:

– Strategic Expertise:

Clients complain that agencies don’t think strategically, don’t have solutions that help clients gain market share, increase volume or otherwise steal sales from their competitors. They feel agencies don’t know their customers, their market, their competitors, their sales and distribution channels – in short: the complexity of the business. .

Agencies feel that clients don’t ‘get’ marketing, just focus on ROI and sales. They don’t get brand building and set unrealistic goals. Agencies don’t believe they are considered partners, just a commodity, ready to be thrown on the big pile.

– Transparency & Accountability

Clients believe agencies are bad at strategy and analytics. They can’t effectively measure the results they produce, or even worse, hide the real results. Clients desire more accountability from agencies: either sales, volume or ROI. At the least, they want to know how an agency defines success.

Agencies believe that there’s more to advertising than analytics and sales. While clients want deep analytics and strategy, they are not willing to pay for it. Clients just look at production and media costs, expect the strategy/analytics part to be a value-add.

– Creativity

Most clients believe their agencies are not creative enough. They don’t get enough brilliant and innovative ideas.

Agencies believe clients don’t get sophisticated create, don’t get new technologies and scared of new ideas.

– Trust & Service

Clients believe agencies don’t really listen to them, they don’t receive the desired attention and have to deal with junior staff after the initial pitch. Not enough unsolicited ideas, not enough interesting ideas, not enough fully developed ideas. They feel that agencies express a superiority towards the internal marketing team.

Agencies feel there’s no loyalty on the client side, trust being the main factor. Too often, they are being tested and not being seen as a collaborative partner. Clients can be abusive: passive-aggressive (delaying approvals) or direct (screaming/nasty emails).

– Costs & Capabilities:

Clients feel agencies nickel & dime them constantly on items that should be part of the project. They don’t know how to price a project and manage the costs throughout the process. Clients don’t want to deal with multiple agencies but they feel handcuffed assigning everything to one agency. They desire a more flexible and fluid model.

Agencies believe more clients want work for free or that clients just don’t pay enough. They often have to deal with procurement directly, a business division solely focusing on cutting costs. Clients often start out with one budget but get cuts later and expect the same results.

So, is the agency model about to expire?

The summary of the report is pretty devastating: Clients have business needs and objectives. They hope an agency can help them to achieve those through marketing and advertising. However, they don’t believe agencies are well equipped to surmount any of these challenges. That’s how the distrust cycle begins. And ends with a review.

There are two major challenges:

  1. Nobody pays agencies a dime to become experts on the client’s business. That’s why agencies become experts on advertising. They don’t have the people, reward structure and procedures to explore the economic and market structures of the client and, if needed, challenge the client in his assumptions. Agencies are often limited interacting with the client’s marketing department, lacking insights from other divisions to develop the best recommendations. And the client doesn’t pay an agency to get that information on their own.
  2. The fear factor: Let’s face it: Good advertising is not direct marketing. It’s based on good insights, hidden desires, based on lifestyle, develops cultural icons and builds a movement. When you found that nugget, that little hidden thing, you will do anything to defend it. Agencies will limit their research to prove their case. They will bring limited ideas to the table to make sure that the one idea will be bough by client. That idea is really the only thing they have, the only thing that keeps them in business. When the campaign is over, they will gather research that defends their idea, they often don’t gather the best data and don’t learn from campaign to campaign.

That’s why relationships falter: hurt feelings, unmet needs, disappointment, and an erosion of trust. That’s what happens when you misalign expectations with capabilities.

Nobody is at fault here

Clients ask agencies to solve problems they can’t solve.

Agencies are too married to the services they provide, not the outcomes of those services they created at one point.

It comes back to the old paradox: Agencies thought they were in the business of selling access to the development and placement of advertising, while their clients were trying to buy increased sales.

Clients don’t need agencies anymore.

They still need creative production and media placements/negotiation, etc. But not a full-service agency.

What they need now are business-model-seeking agencies that create roadmaps to carry out consumer, product, channel and marketing strategies. These agencies will facilitate the creation of assets that are placed into those channels or campaigns on behalf of their clients. They will be trusted experts who guide clients through the ever-evolving landscape of their market.

Capitalism is the art of creative destruction. Some agencies will prosper, some flounder, others disappear. Nothing is forever.

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Marva Collins started in 1975 Westside Preparatory School in Garfield Park, an impoverished neighborhood in Chicago. She took these inner-city kids who had failed in public schools and started to treat like geniuses. Some of her students had been labeled  as “retarded” or “learning disabled.” Early in life, these kids had lost their enthusiasm and lust for life.

These “disabled” kids soon started to read Tolstoy, second graders recited Shakespeare and heated discussions about Kipling were common.

Marva Collins believed people’s qualities are not carved in stone.

This fixed mindset leads you to believe that you will never change. That’s the reason why you think you can’t draw or sing. Somebody told you once that you can’t do certain things, that you are the way you are for the rest of your life. As soon as children become able to evaluate themselves, some of them become afraid of challenges. They become afraid of not being smart. If things get too challenging – when people don’t feel smart or talented – they lose interest.

The growth mindset is based on the belief that your basic qualities are things you can cultivate through your efforts. Although people may differ in every which way – in their initial talents and aptitudes, interests, or temperaments – everyone can change and grow through application and experience. This belief creates a passion for learning. Why would care to prove to the world how great you are, when you can get better? Why try to hide flaws when you can overcome them? And why go for the stuff that worked in the past, instead of trying new experiences?

So, does your brand have a fixed or growth mindset?

Is your brand focused on validating itself all day long? Extremes like Enron and Lehman Brothers come to mind. The newspaper and music industry. Detroit. The graveyard of formerly great companies is littered with brands that had a fixed mindset. They never changed, never the let air in, adjusted to changing times way too late.

Brands based in a growth mindset communicate possibilities. They stand for innovation, they believe in human potential and development, stakeholders are trying to help each other. They embrace failures and cherish learning experiences.

Your company needs to overcome the fixed mindset.

Many successful companies develop fixed mindsets. They refuse to believe that a company with people less talented and not as smart as them can ever have the ability to surpass them. They still believe that attention and market share can be bought. They refuse to push, stretch and confront their own mistakes and grow from them.

They can change and overcome the fixed mindset.

Or they’ll die.

(The inspiration for this post came from “Mindset – The Psychology of success” by Carol S. Dweck, PH.D)

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You invested years and millions of dollars developing a brand positioning. You sat through endless workshops and thousands of slides to come ahead of the competition and move your client/brand to the next level.

It took you gazillion meetings to get every stakeholder on the same page and everybody agrees to the new positioning.

And now it’s time to share your new positioning with the world. Millions of dollars are being invested to share your new vision with the ones that want to hear. Brain power that could light up Beijing is being used to developed integrated strategies.

And then the recall hit. A tsunami. An irreverent tweet. A customer service mishap that goes viral.

Millions of dollars: Gone. Wasted. Years of hard work: Gone. Wasted.

Your happy ads and smiling faces now seem so irrelevant and can’t compete with the reality of the news. That happy model doesn’t look like your customer service representative whose totally stressed out and can’t help but reverting to the script. Suddenly, your Alice-in-Wonderland-ad-world feels like a parody. The ivory tower of brand positioning while the world around you falls apart.

When life hits, it makes all your meetings and positioning documents look silly

The brands that survive these hits, these black swans, are the ones that live values and philosophies, not live them through decks and internal meetings.

These brands understand that life is not lived in the corporate ivory tower, it’s lived by real people dealing with reality. That means: stuff happens. Black swans will suddenly show up. And destroy your carefully developed strategy in one second.

A brand isn’t developed or positioned by sticking to a strategy document. A brand is developed by doing stuff that reflects your culture, your values, your beliefs. In a relevant way, tightly aligned with the needs of people.

It makes me sad to see how few Japanese companies have been able to turn the earthquake/tsunami into an opportunity to trust these companies for life. We read a lot about their supply-chain problems, they have given money but I don’t see anything that comes out of the core of the brand. Nothing that makes me believe or feels like it’s moving Japan forward.

People are fickle. We already started to move away from Japan and focus on Libya. The opportunity is slipping away. Your brand and reputation is built more in bad times than good, it saddens me that only a few have embraced this opportunity to live their brand values.

“We are all faced with a series of great opportunities brilliantly disguised as impossible situations.” –Charles R. Swindoll

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Pardon my ignorance, but I thought Sizzler was a pure US brand. The Salad bar, the mediocre (I’m being nice here) steak, the plastic diner atmosphere. Oh, and the soft ice cream. Well, I was wrong. It’s a global brand. As usual: I know that I know nothing.

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Images: Courtesy of Music Philosophy (Mico, you rock!)

Strategic Planning was born around 100 years ago when the first cars went into mass production: The lack of product was vast and the economic landscape easy to oversee, making it easy for companies to adjust to changes immediately. Markets were slow and people believed humans can achieve anything, supported by Strategic Planning. This mechanical view of the economy and an enterprise left the role of Strategic Planning almost untouched and its importance has even grown over time.

Problem is: The world enterprises operate in has dramatically changed. In a world of saturated markets, educated people playing their consumer role rather unwillingly, globalization, terror attacks, ash clouds, etc. Strategic Planning becomes a farcical endeavor. Maneuvering an enterprise has become an illusion. But we continue to plan.

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Strategic Planning is a waste of time

Successful companies are highly flexible and adaptable in an ever-changing world and market. That’s the opposite of a plan: focusing on getting something done in a certain amount of time.

Let’s just have a look at the US government: Every year they plan on paying down the debt – and every year they face  new surprises: high unemployment rate, a Supreme Court decision, an oil spill. Immediately, all the Strategic Planning is out the door and projections have to be adjusted. Planning is not forward-looking, Planning is static and reactive.

Same is true for enterprises: The performance of a company is more often than  not influenced by factors out of their influence sphere: price of commodities change, currencies fluctuate or a banal law changes somewhere in the world and affects the performance of the enterprise – once again, projections have nothing to do with reality. This results in permanent frustration. And, companies develop the tendency to find someone to blame: Purchasing, Sales, Product.

Anyone who still hopes to control the future with numbers has no clue how markets work nowadays, doesn’t know how you can get optimal performance out of all stakeholders or just lives in a perfect world, fueled by selfish wishes and hopes.

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Executives don’t like change

The idea that executives don’t maneuver the enterprise through the stormy seas (Actually, it’s the other way around.) doesn’t fit in their MBA-fueled pipedreams of being the sole savior of this struggling ship. A myth born in the Industrial Age. In addition, executives believe they need Strategic Planning to control their employees. At its core, most managers believe their employees are lazy bums that can’t be trusted. (Honestly, without me they just wouldn’t do anything all day.) For that reason, employees need to get clear goals and constant observation.

Peter Drucker’s Management by Objectives (MBO) gave executives more fodder for their bizarre prejudice that people without objectives have no clue what to do. People wouldn’t work efficiently without planning goals. This resulted in an enterprise world gone crazy: Increase revenue by 13%, reduce costs by 12%, service has to increase their number by 10% for the next 5 years. Totally absurd. We call it: Management.

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Shift power from executives to all stakeholders

This absurdity we call management has to be replaced with a new paradigm:

  • Focus on relative goals
  • Empower your employees by trusting them 100% and allow them to react individually to demands of stakeholders
  • Focus on culture

Don’t stick to numeric goals: Would you want a NASCAR driver to win a race or plan for him to drive the race in 2 hours and 32 minutes? Foster a culture where it’s about winning not making numbers.

If a department/division/branch has problems, don’t let the executives take over. Stakeholders have to find their own way out of the mess and don’t need the savior from headquarter. This might leave the executives with less opportunities to congratulate themselves but will increase team morale dramatically. The role of leadership has to be be redefined: It’s not about controlling people. That breeds resentments. And crushes spirits.

It’s about inspiring people. Engaging them. Executives need to lead, not control.

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Redefine enterprise success

Executives have to throw away their outdated Org charts, their hierarchy thinking and the focus on their selfish goals. The new enterprise places stakeholders on the pedestal, makes humans not plans their focus. Once you place your trust in all your stakeholders and empower them, goals like shareholder value, executive salaries and bonuses will fall into place.

Enterprises need less goals, not more. Goals are overrated. Real success metrics are an organic byproduct of a real corporate identity. It shouldn’t be about corporate goals determined by a few, it should be about corporate identity lived each and every day by all stakeholders. Focusing on corporate culture will help enterprises to develop a congruent group of like-minded people. Forget the performance review. Lean on peer pressure as the guiding force.

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Strategic Planning vs Being Prepared

Strategic Planning means: Derived out of an executive vision of the future and assessment of the present, the company develops a plan that everybody has to follow blindly. Enterprises based on this belief try to manage the future.

Being Prepared means: We’re trying to be ready for any eventualities, we prepare, we’re staying intellectually fit, always question everything – never separate acting from thinking. Being prepared is an attitude. This attitude will allow companies to be successful in the future. Strategic Planning dooms them.

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Strategy has its roots in the military. Even the military doesn’t need mindless warriors anymore

The idea of Strategic Planning was based on the thought construct that there are two kinds of people: The thinkers, the directors, the controllers. And the mindless workers that do their task and don’t ask questions. Strategy is a tool to keep the doers from thinking and under tight control.

Since the markets control enterprises more efficiently than managers, what’s the value of managers hiding behind strategy decks anymore? Instead, every stakeholder has to think, adjust and do. What company still can afford to employ non-thinking people, happily entrenched in operations? That’s what automization is for.

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Perpetual Test Mode

Enterprises need to ask themselves constantly “How could I do this better?” even when everything works out fine right now. Once enterprises believe they’ve found the perfect model, they will switch into the mode “Why change anything?” And die.

Enterprises need to follow two paths:

  • Implement perpetual, incremental improvements. Why not improving a dozen of little things? Can you improve your website daily outside of the yearly refresh? Can you change the way customer service interacts with people? Are your key employees fully invested on Social Media Channels, always ready to reply? How can you move your company from good service to utter delight?
  • Think big: Some problems can’t be solved with incremental changes. They need significant innovations. How can you leap ahead of your competitors by rethinking how a problem can be solved?

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How to begin the transformation process

This is an unusual paradigm for enterprises. Everything they learned in business schools and on wooden conference tables is useless. Even more: counter-productive.

It behooves every employee to internalize this new world view. And start to develop multiple pilot projects or beta programs. A good first step would be to eliminate the yearly performance reviews and axe yearly planning.

Let’s face it: the world was not meant to be perfect and nobody can control it. We’re supposed to muddle along and work our way through challenges and problems. Once enterprises accept this fact, they have a chance to succeed in the future. Most importantly: As long as managers don’t trust all stakeholder, as long as they don’t believe people will work without control and incentives, just because they want to, as long as managers don’t change their thinking, enterprises will remain the places of outdated hierarchy, intellectual imprisonment and planned economy.

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Image: Courtesy of MusicPhilosophy

This post was featured a few days ago at my weekly column at Jack Myers’ MediaBizBloggers.

When people were consumers, brands lived in this exclusive universe of commerce and communication meant to sell products through emotions with one end goal: make money. Lots of it.

People are not consumers anymore. This is particularly true when people are online. We have transformed into citizen activists, journalists, lawless pirates, producers, protagonist and, more often than not, curmudgeons. People want much more from a brand than just a good offer, relieving them from the tyranny of too many choices or some fancy lines and images.

People will vote with their wallet for things they believe in rather than just buying stuff. Marketing constructs such as brand image are meaningless in a world where people expect brands to “do” rather than show, sell, spin stories nobody believes in anymore.

Successful brands will become social movements, fully committed to a cause. They will connect with people by either sharing a passion or fighting a common enemy. Brands have to come down from their Ivory Tower of branding and stand shoulder to shoulder with people sharing their passion, and helping each other to co-create and collaborate. A brand that shares my passion and is committed to a cause (We’re talking real dollars here…) will be seen as credible, committed and a real change agent.

Ultimately, we have to redefine the nature of commerce. Profits will continue to be important. Brands that define themselves solely through Wall Street results will not survive. The pursuit of a higher good than just selling stuff will become the admission fee into people’s mind.

We used to look at government programs to better the world, improve our surroundings. The stranglehold of debt will severely reduce opportunities for government institutions to be a change agent. Brands need to step up and become a cultural change agent. They have the monetary power, they have a better organizational structure than any government institution and they understand the power of democracy better than anybody else: Their constituents vote with their wallet not because of some ideology, family history or flawed loyalty.

There’s nothing wrong with making money. But making meaning is so much more powerful.

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Image courtesy of 24.media.tumblr.com

When we started this venture we call BatesHook, I was reflecting on my work life and experience, trying to implement best practices into my own company, hoping to avoid the dreaded pitfalls. And I was trying to find the common thread why I loved working for this company and dreaded working for this one. Why 8 hours at one agency killed my spirit, while 16 hours here made me feel alive. It all came down to one thing: Values. One brand stood for something, the other place shared only one tangible value: shareholder return.

There’s nothing wrong with making money but if that’s the only reason for an organization to be around, you can see it permeating the entire organization, up to the C-Suite where the sound of cash registers drones out any sense of decency and humanity. Layoffs just equal cost savings not human misery. All sorts of shortcuts equal improvement of the short-term bottom line, just to conveniently ignore the long-term costs.

After the multitude of bubbles have burst, shareholder value and making money for the sake of money doesn’t feel that good anymore. And consumers are craving institutions that care and give back. This and the age of product parity lead to an avalanche of brands that suddenly care, that support businesses in making positive change, try to rebrand themselves as green or just transform communities around the world (right after they almost destroyed the whole financial system).

Most of this comes across as advertising, not as a commitment. Because it’s not rooted in real values, we are starting to deal with caring parity: Suddenly everybody cares for the wrong reason. Consumers want us to care, let’s care. Brands purely jumping on the caring bandwagon are missing out on a huge opportunity: Stand for something. Have values. And express yourself as an organization based on these values.

What gets you more excited? The horsepower of the new Accord or the power of dreams outside of Honda’s corporate walls?  What are you talking about more? That Dove has no soap scum or that physical beauty is only skin deep? What’s more interesting? The newest feature on a Dell Computer or their commitment to eliminate the digital divide? (Just an idea, Dell.)

Standing for something that’s rooted in corporate values eliminates the need to spout off undifferentiated messages, bland and politically correct brand communiques and mind-numbing feature lists. Sure, standing for something is not easy. It might offend some. Actually, it better offend some. Not everybody will like it. But real leaders don’t care. Brand leaders. Human leaders.

“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where stands at tome of challenge and controversy.” –Dr. Martin Luther King Kr.

The values of your brand determines the value of your brand.

So, what’s your brand standing for?