Nandu Nandkishore is an Executive Fellow at London Business School and the former Executive Vice President and board member of Nestle Asia, Oceania and Africa, where he built his reputation as a great leader and brand builder (As Martin Lindstrom previously has highlighted in his interview on this blog). Today, Nandu holds a number of non-executive board positions in early stage tech companies.
In my interview with branding Guru Martin Lindstrom, he highlighted and mentioned you as one of the few people who “truly understands the consumer”. Where does this understanding come from and what do you do differently?
You need to understand two things deeply. You need to understand consumers and your products deeply. Both are important. You have to have deep consumer insight and deep product insight.
For understanding the consumers, there is no substitute for going out and observing consumers and talking to them. I used to have a habit of going to the market for one day every week, to talk to consumers, observe them, watch competitors and even companies in noncompeting sectors, for example, ‘what are they doing in shampoo?’ Because there is always learning to be had, by observing how people shop, what they shop, why they picked up something and put it back.
I’ll give you an example: once in the Philippines, I observed the consumer buying a brand of milk powder. I went and asked her, “Why did you choose this brand over the other brand?”
“Because it has this ingredient,” she said.
“Okay, I understand using this ingredient is good. Why do you think it is good?”
“It helps build my child’s brain.”
“Okay, have you checked the other brands and have you checked the ingredient list to see if they also include it and how much?”
She hadn’t, so we checked together. We checked 3 to 4 different labels of ingredient list and she realized that by just checking the ingredient list she could get so much information on the reality of what she was buying.
I went back to the office and then we studied the labels of our brand and our competitive brands and we realized that actually our competitors had a lot more sugar in their products than we had. In fact, we had more of the healthy or active ingredients such as DHA than the competition had. The question was: How do you communicate this to consumers?
This was a challenge that we put forward to the agency and the famous Nido “Check the Label” campaign was born. We challenged the consumers to know how to check the ingredients of the label and how to check the claims of the manufacturers and then make up their mind themselves based on an informed choice –not just based on advertising.
That was a very successful campaign and in fact, the campaign went global and is still running globally to this day. That was an interesting story, which emphasized that consumer understanding and product understanding both are important.
Nescafé is such a strong brand leader and with such iconic brand elements that you may not even have to say the name. We were confident enough in these elements to create a commercial at the time that had all these iconic elements strongly embedded but did not actually say Nescafé anywhere. When we ran that commercial, consumers loved it because it was beautiful storytelling and they all knew it was Nescafé.
We worked with Martin [Lindstrom] on understanding Nescafé and we were able to identify what the brand iconic elements of Nescafé are. Nescafé is such a strong brand leader and with such iconic brand elements that you may not even have to say the name. The red mug for instance; how you stir the coffee in the red mug; or the sounds made when stirring which are so evocative of the whole romance and engagement with Nescafé. We were confident enough in these elements to create a commercial at the time that had all these iconic elements strongly embedded but did not actually say Nescafé anywhere. When we ran that commercial, consumers loved it because it was beautiful storytelling and they all knew it was Nescafé. The branding was powerful without mentioning the brand Nescafé even once!
The truly successful and iconic brands are those that understand history and understand that the elements, which consumers identify with, should not change.
That’s a great example. It all sounds easy when you mention it like that. If we turn it upside down, what are some of the things you see that most marketers get wrong in doing this?
Many people misunderstand what branding is. They think branding is about having a big logo. That is not true. Branding is about the sum total of all the behavior you do as a brand, to engage and connect with your consumers. It is the tone of voice, the colors, the sound, and the smell – actually all five senses. It’s how you engage with consumers. This engagement happens at various stages. It happens remotely when you’re advertising and in a digital medium. It happens in store when you touch the product, how the product feels and smells. It happens when you use the product. How does it sound when you open the label? How does it sound when you prepare the product? Branding has many elements to it.
As a customer, you know when you fly Singapore Airlines –it is a wonderful airline. You realize when you walk in to Singapore Airlines that there is a particular smell – it is always the same. That smell is reminiscent to you of a great experience with Singapore Airlines. The moment you smell that again, you are instantly transported to this magical world of Singapore Airlines Service. Branding is not just putting big logotype over there. It is a sum totality of how you engage with the consumers and you need to look after all these elements.
The trouble is often that brand managers don’t know all of this. In many companies, what typically happens is that a brand manager changes every two to three years. When he or she joins, the first thing they say is, “I have to make my mark on this brand so let me change everything that happened in the past.”
However, the truly successful and iconic brands are those that understand history and understand that the elements, which consumers identify with, should not change. Coca-Cola has a great story –whether it is the brand colors or the shape, these fundamentals have not changed for over 50 years. Take Milo in Southeast Asia, the green color, the emphasis on sports–they have not changed. It has been now 35 years and it hasn’t changed. It takes a lot of courage as a brand manager to go in and say, “I have to understand the history of the brand and the iconic elements of that brand and then have the courage not to change those fundamentals.”
You talk a lot about history, but how do you do this when you come to markets with no history with that brand? How can you bring the heritage with you?
That is challenging. It is important to make sure that you really understand what the consumers have today. If you are going to come in with something that is already on the market, that is a “me-too”, you really don’t have much of a chance to succeed.
In India back in time, Cadbury heavily dominated the tablet chocolate market and we did launch a tablet chocolate, but it never did very well. We got to whatever, 10% market share maybe, and stagnated or declined from there. On the other hand, KitKat was a genuinely different offering. It was a perfect blend of wafers and chocolate, and it was light to eat which was excellent for a tropical country. KitKat was an offering that did not exist in the market at that point in time, so we had to be careful about how we built it and truly understood what the brand was, and what the success criteria for the brand were in markets where it had done well and survived for over 50 years.
When you start building a new brand, initially it is tempting to capitalize on the newness; but that is not enough because you have to start putting these brand fundamentals in place right from day one. For KitKat for instance, it is how you eat the product, how you open the label, how you run you finger down to slit the foil, how you break the finger, and the whole context in which you have this product: you sit down, you relax, you are enjoying the break. All these are fundamental iconic elements of KitKat. We have to understand that and internalize it and then we have to make sure that everything we do from day one incorporated all these elements so that you build the fundamentals of a strong brand that can last a hundred years.
Would you say that this is unique to the Nestle way of building brands?
Yes. All brands have strong iconic elements that are useful and important for brand managers to understand. In Nestle, there is a strong discipline called brand building the Nestle way, which is a strong discipline that all brand managers are trained on and go through. Every company has its unique methodology. P&G have their methodology. Unilever have their methodology. There is nobody saying one methodology is superior to the other but what is important is to have a methodology that allows you to understand the consumer, your brand, and your product and then bring the whole thing to life in a way that truly engages with the consumers in a consistent way, over time.
The most important values for a brand to survive over time are trust and authenticity. If you do not have trust and authenticity, then the brand will not survive, because people quickly will see the brand as fake.
In a recent column in Adage, you mentioned that one of the things technology brands can learn from CPG brands is around building a global culture. If you have to give advice to technology brands, how would you suggest they tackle this?
The most important values for a brand to survive over time are trust and authenticity. If you do not have trust and authenticity, then the brand will not survive, because people quickly will see the brand as fake.
It is important to define up front, what the elements are that you will never compromise. Whether it is the quality of the product or whether it is a particular physical attribute of the product. You know the quality of Singapore Airlines service for instance, you have to define these attributes up front then you have to make sure that no matter what happens, you do not compromise on those attributes. It takes courage, and it takes top management willingness to support that kind of direction over time.
It is tempting at times of crisis, to take a shot with a new approach, but you see now with the Volkswagen crisis for instance, that the Volkswagen brand has probably been damaged almost irrevocably for a long time. There are brand fundamentals that you need to define and the most important is the TRUST relationship with the consumers. You cannot compromise this and that is the most important thing to understand in building a global brand. This TRUST relationship has to be built day-by-day, user location by user location, in every single country. In today’s globalized world, one event in one country can quickly ripple and have damaging effects of the brand in any other country. In a global culture, it is important to understand why you are behaving the way you are behaving, no matter how small your market is and keeping in mind a global audience.
A lot depends on for you as a consumer–is it a high-interest category or not? If it is not a high-interest category chances are you will be more promiscuous. If it is a high-interest category, you will be brand loyal.
Another thing you mentioned in your column is the benefit of stickiness, which obviously builds a stronger brand. How have you seen this in the internet or technology space? Creating this stickiness can be difficult in digital space.
Yes, this is true. In all brands where the frequency of purchase is high, you tend to have risks of people being promiscuous and flirting with different brands. If you‘re buying a bar of soap, every time you walk into the store, there is a risk that you will buy a different bar of soap. A lot depends on for you as a consumer–is it a high-interest category or not? If it is not a high-interest category chances are you will be more promiscuous. If it is a high-interest category, you will be brand loyal.
Now let me ask you a question, can you possibly imagine that somebody has so much brand loyalty that he tattoos the name of the brand on to his body. Can you imagine this? Can you imagine somebody tattooing Mars or Facebook on his body?
Harley Davidson is a brand that is so strong and is so sticky that people actually tattoo it on their body and say “I am a Harley-Davidson guy”. Harley-Davidson is not just a motorcycle. A Harley-Davidson is a magic portal whereby a nerdy accountant can sit on the bike, wear black leather, and roar through towns scaring everybody half to death. That is a fantastic example of how to build a really strong brand that is sticky over time.
The challenge going forward when talking of stickiness is that today you have the whole new digital space, and how that will influence the way we interact with brands. The obvious answer is that the way we consume media, for instance, has fundamentally changed. All of us are getting our media content mostly from the internet, instead of television or magazines; and that has fundamental implications for the world of advertising.
Platforms like Facebook or Google, not only are they fantastic media platforms, they understand their consumers really well because they use data to understand what their consumers are doing, when they are doing it, and they know how to connect with the consumer, to really give a fantastic consumer experience. These are great examples of brands that are building stickiness. Google has become a word in the dictionary but 15 years ago, I am sure most people did not even know Google. Today, you cannot imagine life without Google. It is a brand and it is extremely sticky because it gives you exactly what you are looking for. It gives you a perfect example of search.
The question going forward is “what are those new developments that we can expect, and how will they change the world of brand building?”
The Tide button from Amazon is a beautiful thing. What P&G has done to reorder Tide directly from the washing machine, is brilliant. But what if you could just point your mobile phone at your bag of pet food or your box of detergent and press a button and order with one click. You can do that too, today; and that is what augmented reality can do with visual recognition. If you can just recognize the bag of detergent through visual recognition technology, then the Amazon dash button lives on your phone and can be used for any products. Imagine you already today could enable “anywhere-commerce,” because e-commerce is big but the future is “anywhere-commerce”. Anywhere-commerce can be visually engaged through your mobile phone using visual discovery technology and that is going to create a completely new business model out there.
The technology will come in and enhance consumer brands and the brands will have to add a layer of information and augmentation of reality on top of the physical reality. That is going to come.
We talked a bit about the typical branding before. What do you think internet companies in general can learn about brand building from the way that consumer products are built?
Consumer products are already embracing digital technology in a big way, but consumers are going to force this to happen. For example, you would like to know when you have a chocolate whether the cocoa came from a responsibly sourced farm. Today, you have the technology where you can actually use augmented reality to scan your chocolate bar and find out where the cocoa come from and what kind of practices they have. If I am not mistaken, Friesland [Edit: FrieslandCampina] actually has a technology whereby you can find out even which farm the milk came from, which farmer and which cow supplied the milk that you are drinking. It is quite mind blowing that you can do things like that. The technology will come in and enhance consumer brands and the brands will have to add a layer of information and augmentation of reality on top of the physical reality. That is going to come.
Now, in the same way, digital brands like Facebook and Uber will have to learn from consumer brands. There is no substitute to consistency, TRUST, and authenticity and to building that over time – even if it means short-term pain. So far, it appears that they have taken these lessons well and they are learning.
We as human beings crave for stories. You know we crave stories from the time we are children. Most advertising has forgotten about storytelling and therefore it tends to be bad, forgettable, and it costs you a lot. Sometimes it only survives because they bombard you with it a hundred times a day. When you have great storytelling, then just seeing it once is enough. You want to go back and read the story or see the story repeatedly. The trick to great communication is, use the data, base your story on the rational truth, but ultimately you are telling stories and consumers are listening to stories. They are listening to stories with their emotions, their hearts, and then their minds follow.
Looking now a bit more into the future, what are some of the trends you see in branding in general that are coming off now and will influence the future more than they’re doing today already?
Well, a brand is a sum total as I said of the way it behaves and engages with its consumers. Brands are far more than just a physical offering. It is how they behave in society. Consumers, more and more are going to want to know what their brand stands for and how their brand behaves in society; how it treats minorities; how it treats women; how it treats the environment; and questions like that.
People are going to ask for more and more information sharing and access to information on brands so that they can make informed choices about the brands they stay with over time. Therefore, all brands are going to have to find a way to enhance their physical offering with an information layer because consumers are going to demand this to allow them to determine the authenticity and trustworthiness of the brands that they buy.
Real-time with data, with information layering on top of the physical reality that is the shape of things to come. This is true for a car. It is true for fast-moving consumer goods. It is true for a restaurant. Today, you go to a restaurant and you can immediately get the review on Yelp or TripAdvisor. With these sites, you cannot escape if you have a bad service and the person is going to go out there and write a bad review. If you have a great service, she may or may not write a great review but if the service is really WOW, then she will.
What are some of the techniques that work in the past that you are seeing dying today?
Consumer and product understanding will always be important. You cannot replace that. When you are launching a new product, proper understanding of what the competitors are offering and making sure that you have a significantly superior value proposition will not change either. There is no substitute for those.
In the past, information flow was ‘word of mouth’. It was talking to your friends and family. Today, the same ‘word of mouth’, amplifies through social media and goes a million times faster. Brands have no choice but to engage with this new demand for information. This also applies to crisis management and crisis handling. If you have a problem in one part of the world, you better step up to it quickly and address the problem front on.
Recently, I heard about a sandwich chain in Australia that was selling a foot-long sandwich. A customer measured the sandwich and found it was only 11 inches long, so he complained and he was not well received. In the end, he spoke about it on social media, all his friends all over the world started measuring the foot-long sandwiches and they found they were less than 12 inches. There was a big social media outcry against that particular brand.
If the brand had just come out and said “Listen, we value what you feel, and in the future if you find or need anything, any foot long sandwich that is less than 12 inches long, we are going to give you a free sandwich.” Then you would have created a lot of consumer goodwill or if you would have come and said, “Listen, we’ve realized that there was a problem with that particular batch. For the next 2 months, we are going to make sure every 12-inch sandwich is actually 13 inches.” Then you create consumer goodwill. The TRUST that you create – the brand reputation that you create – is far more than any advertising can do for you.
My key message for your audience is storytelling that combines rational truth in emotionally relevant contexts. We as human beings crave for stories. You know we crave stories from the time we are children. Most advertising has forgotten about storytelling and therefore it tends to be bad, forgettable, and it costs you a lot. Sometimes it only survives because they bombard you with it a hundred times a day. When you have great storytelling, then just seeing it once is enough. You want to go back and read the story or see the story repeatedly. The trick to great communication is, use the data, base your story on the rational truth, but ultimately you are telling stories and consumers are listening to stories. They are listening to stories with their emotions, their hearts, and then their minds follow.
The glamour world of advertising and marketing theory sitting in an air-conditioned office seduces many people, but there is no substitute to actually going out there and getting your hands dirty. Even in my future life as a marketer, I continue once a week to be out there getting my hands dirty, talking to consumers and customers. There is no substitute for that.
Many of the brands in the Nestle family have the benefit of having some history to them. What are some brands that you would say have been doing well in building up a great brand in a much shorter time?
Facebook and Google. Two powerful brands that have been built up in a short amount of time. Apple is another powerful brand. It stands for great design, great consumer value, and intuitive usage being built for a short period of time. These are fantastic examples of brands that have been built which now have to sustain. Building is one thing, sustaining is another thing.
From your own career, are there some lessons that in terms of marketing you have got to learn the hard way?
You learn every day. You have to keep your eyes open. Sometimes, even consumers will teach you something. Talking to consumers, watching them, watching what they buy, watching what they do not buy, watching when they buy, you’re going to ask them “why did you buy?”
Customers will teach you because they have access to a lot of data. They see the trends. Competitive categories will teach you, sometimes by looking at other categories you will learn how not to handle the crisis for instance and particularly in the digital era I think we are all learners. We are all learning every day and we all learn by trial and error. Some things work out and some things don’t and you can use a lot of logic but at the end of the day there is still a lot of learning by trial and error that happens.
Would you say there is any advice you got earlier on your career that have made a difference to you sort of later on, or did all like coming from time to time?
I started my career as a management trainee in Cheseborough Pond’s and in my earlier years, the focus was much on understanding sales. It is important to understand how the sales function works and actually get your hands dirty selling—know prices; know wholesale markets; know how stock moves; and what are the risks; what are the opportunities. Because if you do not understand the details of sales and distribution, then it is difficult to be a good marketer.
The glamour world of advertising and marketing theory sitting in an air-conditioned office seduces many people, but there is no substitute to actually going out there and getting your hands dirty. Even in my future life as a marketer, I continue once a week to be out there getting my hands dirty, talking to consumers and customers. There is no substitute for that.
Apart from learning marketing, I found that actually working in sales was a fantastic way to build up your communication skills and to build up your leadership skills because when you are leading salesmen, leading distributers, leading by talking, speaking with teams, groups of retailers and you are basically trying to influence their behavior, often even without any hierarchal authority. It is a fantastic training ground to build up leadership skills that stand you in good step later on in life.
Perfect. Last two questions I have, the first one is for people who are a bit early in their careers, what are 2-3 books you recommend them to read?
Firstly, the business book “Good to Great” by James Collins is important. It is a great read. He talks about for companies to look at three intersecting circles: Firstly, something that you are best in the world at doing, secondly, something that you really love doing and are passionate about, and thirdly, something that gives you value – dollars – or creates some shareholder value for you. He says if you can say yes to all three circles–the intersection set of all three circles, that is what you should focus on. Get away from everything else if it doesn’t tick all three boxes. This is true of companies. I think it is also true of individuals.
The other important concept he talks about is the concept of level 5 leadership. That is a concept that I have embraced, I loved, and I tried to model or build my leadership style in that.
On marketing, Buyology is a fantastic book worth reading by Martin Lindstrom. Malcolm Gladwell, Tipping Point is a great read to understand how big changes can happen. He has written some other nice books too.
These are all good reads for the professional manager. I assume in their education they have already gone through the basics –like Kotler for instance.
The final point, if people want to hear more of your thoughts and follow more of what you are doing, what is the best way for people to reach you?
I am on Facebook, I am on LinkedIn, I am on Twitter, and I am on Google+. I am accessible through all these media and I frequently post articles that are accessible to the public, not just my friends. At some point, I will set up a website, but it is not yet there.
###
Please feel free to share your comments and thoughts below.