I came across an interesting piece on authentic brands on Linked In, written by Jamie Mitchell. He claims there is a crisis of trust in businesses today and predicts that the answer will be provided not by big business but by "The slow rise, and eventual domination, of "authentic brands." He uses as examples of authentic brands three companies he has worked for: innocent, Daylesford and Tom Dixon.
I found a lot of what Jamie wrote inspiring and share some highlights below. But I'll also raise one important question he didn't cover, which is can authentic brands pay their own way?
1. I'm all for authenicty
Jamie proposes five characteristics of authentic brands, all of which I applaud and agree with. Three of these form the foundation of any strong brand: vision, ambition and point-of-view. The other two features relate to turning this brand vision into action. One feature is having some real product "sausage" not just emotional "sizzle". The other is having making a contribution to society and having a "Genuine commitment to earning 'decent profits, decently'". For example, innocent give 10% of profits to charity and Dayelsford is a champion of organic farming.
However, I would add a sixth point which I suggest is the most important: distinctiveness. innocent was not truly different from other smoothie brands like PJ's. But is was highly distinctive, with a host of brand properties that meant it was more effective at creating memory structure, as I posted on here
back in 2007. These include the tone of voice on the packaging, the "angel" logo and the distinctive activations that do good, such as The Big Knit I posted on here
. There are plenty of different cafes selling nice organic food, but the Dayelsford Farm Shops are beautifully executed and have a distinctive "rustic chic" look and feel.
2. Show me the money
The important point that is not addressed in the article is whether the types of authentic brands Jamie describes can pay their own way. Take Dayelsford Organic. In the first seven years of trading after starting out in 2003 the business lost money, with total losses of £27 million. Jamie did help cut these losses after arriving as CEO in 2009, when the company lost £11.3 million on sales of £9.9 million. Losses were £2.9 million in 2012 and £2million in 2013. But no normal business could survive so long losing money like this. Dayelsford is still alive because it is owned and backed by the multi-billionaire Bamford family, who own tractor company JCB. And good on them, if they want to spend their money this way. (They also do a huge amount of charitable work)
And what about innocent? I have expressed a whole lotta love for this brand over the years in numerous posts. But I was disappointed to find the table below showing the brand's profit performance. Between 2004 and 2011 cumulative profit after tax was -£10.5 million. How did innocent survive? They sold 20% of the business to Coke in 2009, as I posted here
. The company got back to profitability in 2012 and then…. sold the whole lot in 2013 to Coke, who I guess qualify to be one of what Jamie calls "big businesses with their faceless brands and endless bureaucracies".
3. BIG business is the answer
I'm a big fan of brand authenticity. The blog you are reading has been promoting "branding based on substance, not spin" since its inception in 2007. However, the harsh reality is that small, authentic brands like the ones Jamie describes are not going to slowly rise and dominate. As shown above, both innocent and Dayelsford have been bank-rolled by big businesses.
I'm more optimistic than Jamie about big business, disagreeing when he says that "'big business' seems institutionally unable to respond proactively to the challenges posed to capitalism today."
I suggest what we need is "big brand authenticity". For example, Pret a Manger is a big and authentic brand. It has a strong product truth, with all sandwiches handmade on the premises each day, using only fresh and natural ingredients. All the leftovers are given to homeless people each day. And they have created decent jobs for thousands of people, as I posted here
. I've also posted here
on Unilever, who Jamie does mention. It might not be a perfect company, but it does seem to have a genuine commitment to growing sales whilst reducing environmental impact and supporting good causes.
In conclusion, brand authenticity is a laudable goal. But unless you create a sustainably profitable business model, you may need one of those big businesses Jamie criticises to help fund your authenticity.