Q&A: Gilmore Keeps It Real

SAN FRANCISCO Strategic consultant James H. Gilmore helped spawn global interest in experience-based marketing and design in 1999 as co-author of The Experience Economy. His latest book, written with Joseph Pine, is Authenticity: What Consumers Really Want (Harvard Business School Press, 2007), which contends that people crave genuine and authentic product experiences in a world that is increasingly commercialized and fake.As co-founder of 11-year-old Strategic Horizons, Gilmore, 48, a former Procter & Gamble manager, has worked with Marriott, Omaha Steaks and other marketers. Here he explains how artificial Christmas trees are more authentic than the living version and why companies should ditch experiential marketing and develop an honest sense of place.Q: What is the difference between real and fake brands?A: People often think that a business is real if it is small, local, family-run or not a chain, but that is only their judgment of what is real. What happens if the local, family-run business opens a few new outlets and becomes a chain. Is it no longer real? What's real is in the mind of the beholder. On some level no business is real because it is always man-made and contrived. As a result, you could say all brands are fake. That notion is turning out to be the most controversial idea in our book.Then how can "fake" brands be authentic?First, to be authentic they can't describe themselves as "real" or "authentic." When a product advertises itself as real, it is perceived by consumers as not real. If I met you at a party and I told you I was authentic, it would be proof that I was not authentic. Same with brands. A consumer sees a product as authentic if it conforms to the reflection that the consumer has of himself. A brand is also authentic when it doesn't pretend to be something it is not, when its behavior, distribution and packaging match its identity. In other words, when it is what it says it is. Jones Soda is about design and participating with its customers. It puts pictures by its customers on its labels. So it is distributed in design-oriented Target and not at (mass discounter) Wal-Mart. Or take Christmas trees. Sellers of living Christmas trees focus on how their trees are more natural than artificial trees, but actually they are planted, trimmed and lined up in rows unnaturally. And sales of live trees are going down. Artificial-tree makers don't waste any energy saying their products are real or natural, and they promote the benefits of being man-made, adding artificial features such as holiday scents. Their sales are going up. In other words, authentic brands need to be true to their identity. Isn't that common sense?Not when you consider that marketing traditionally is a phoniness machine. It makes promises, but when consumers see the product or deal with the company, it is a very different experience from what the marketing promised. A friend often says he would like to check into Hotel Ad because it is so much better than any of the hotels in the real world. How about experiential marketing?Experiential marketing is an idea taken from our first book about the experience economy and bastardized. The marketing industry made that term up—we never use it. It is about creating a [branded] experience; it is just another form of marketing. It has nothing to do with being authentic. What kinds of experiences reinforce the authenticity of a brand?The brand experience should be based in actuality and, frankly, not even considered part of the marketing discipline. A company can drive demand by offering people a place where their brand is consumed. This can be a physical or virtual space and can be permanent, temporary or mobile. For instance Mars, the maker of M&Ms, introduced its new Ethel's line of high-end chocolates through Ethel's Chocolate Lounges, which are 21 physical cafes in the Chicago and Las Vegas areas and a virtual page at www.ethelschocolate.com. The physical and online places have the brown and pink look and feel of the brand. In contrast, a Godiva boutique is more elegant with a different feeling, and the Hershey's Cafe is more family and kid oriented, just like its brand. Apple is a pioneer in this "place-making" aspect of branding. The company designs and organizes the Apple stores so you feel like you are walking inside a Mac when you go in the door. What does authenticity and an enlightened sense of place mean for mass marketing and chain outlets?The mass market is gone. It is no longer relevant. Brand managers must factor authenticity into the identity and messaging of their products and services. Ubiquity and sameness kills authenticity, and brand duplication is harmful. Gap stores learned that lesson. If a chain has many outlets, they must be different from each other and maybe even have different names. Starbucks has been able to forestall the perception that it is a mass brand by making its outlets different from each other. Isn't such customization terribly expensive?Starbucks saves money by using modular designs, equipment and paint colors, thus allowing the company to inexpensively adapt each store to its surroundings. What about marketers who say they're in the business of making and selling product, and not in the business of creating cafes or other places for consumers?They are going to have to make the shift from two-dimensional marketing and advertising to three—dimensional demand creation—or die. The experience of consuming the product is the brand they are selling. For instance, U.S. carmakers are dying a slow death, and there is nothing but excuses or denial for why they are not making money. But then there is ridesharing. Now that is interesting. Maybe there is a way to make money by offering ridesharing using the cars that you manufacture. Another example is Netflix. Instead of renting or selling movies one by one, it charges viewers a flat fee for time, and you can order as many movies as you want from a Web site [which is a customized virtual video store]. They are selling the consumption of their product in an innovative way. Are there tips or a formula that marketers can use to instill authenticity into their brands?No, not really. There is no list of colors, words or images that will convince consumers your brands are authentic. By definition, being authentic means your offerings can't copy from another brand. But at the same time, you don't have to invent something completely new. You can innovate by looking at the ideas that are out there and adapting elements that are meaningful for the product and experience you offer. Such adaptation brings us full circle, doesn't it? To be authentic, marketers must first understand what their offering means to consumers.That's right. Companies have to be honest about how their brand is perceived by consumers. I've been in the meetings and I know executives can be delusional. But they can look at YouTube and Flickr and see how the online audience is portraying and talking about their brands, and it tells them what people think about them. If there is nothing on those sites, it means no one cares, which is worse. K-Mart comes to mind. How can they still be in business? But if they honestly saw how much they are perceived as a has-been, they could possibly use that and go kitschy. They could do something that is self-mocking and become cool by being really un-cool in a funny way. What key change would you make in the marketing industry if you could?I'd ban the word marketing. Instead I'd call it "customering," and I'd call the industry "demand creation."

Brand Marketing

Q&A: Gilmore Keeps It Real

Joan Voight

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Joan Voight