Open up your mind and say, ahh...

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Part of an unpublished appendix for The End of Business as Usual…

Think of your favorite brand, and the first thing to come to mind is likely a logo, such as the Coca-Cola scripting, a tag-line, such as Nike’s “Just do it,” or a jingle – remember the Oscar Meyer Wiener song? These may be the aspects of a brand you remember, but they are no longer the most important aspects of branding today. Identity, persona, essence and promise, are the new kings and queens of the branding kingdom, thanks to technology and the deeper connections it opens up between brands and consumers.

Markets, consumer behavior and how businesses connect with customers are all directly impacted by technology. Looking at the rapid erosion of Blockbuster’s business model, it’s clear to see the impact that technology can have on consumer behavior. During Blockbuster’s initial bankruptcy filing, CNBC’s The Faber Report summarized it this way, “At the end of the day, this is one of those bankruptcies that’s not really about a financial situation as much as it’s about seminal changes in how people ultimately watch video.”

The increasingly important role of technology, combined with global economic unrest, means a company’s brand is more important today than it has ever been. Consumers, in search of certainty, rely heavily on a brand’s symbolism and significance. We don’t have to look much further than Netflix for a recent example of what happens when executives misread the impact of technology and consumer demand and in turn, make decisions that have negative effects on the business and the brand. In this case Reed Hastings and company raised prices, which sent customers in an uproar. Feeling the effects of negative sentiment from a full-blown PR crisis and a declining stock price, Netflix opted to divide the company into two entities, Qwikster would handle DVDs and Netflix would focus on digital and streaming. The company caved to consumer and investor pressure however and folded the two entities back under Netflix, killing off Qwikster as quickly as it introduced it. Netflix customers weren’t ready for such a bold move toward a new direction. But, any form of market research that studied conversations in social networks or quite simply, a customer engagement program would have revealed the state of consumer needs. Netflix now must focus on rebuilding its brand to earn and re-earn trust before it can take another aggressive move into the future.

Brands that fail to instill this level of confidence in consumers run the risk of falling to digital Darwinism. The brands that survive this era of economic disruption, will be the ones that are best able to evolve because they recognize the need and opportunity to do so, before their competitors .

Survival of the Fitting

Digital Darwinism is the evolution of consumer behavior when society and technology evolve faster than some companies’ ability to adapt.

The point of natural selection is that not every business will make it. As Edward Lawler and Christopher Worley note in their book Built to Change, “An analysis of Fortune 1000 corporations shows that between 1973 and 1983, 35% of companies in the top 20 were new.” Their work showed that the number of new companies rose to 45 percent between 1983 and 1993. That number increased to 60 percent between 1993 and 2003. And, as they so appropriately asked, “Any bets [as] to where it will be between 2003 and 2013?”

To further their point, a recent ad produced by Babson College cited a rather humbling statistic; “Over 40% of the companies that were at the top of the Fortune 500 in 2000 were no longer there in 2010.”

We’ve witnessed the demise of seemingly invincible brands in the U.S., such as Circuit City, Borders Books, Wherehouse, Tower Records, Pontiac, Saturn, and Palm among others. Meanwhile, grim predictions show that the pattern has no end in sight. In June, 24/7 Wall St. published its annual list of “Ten Brands That Will Disappear in 2012.” The publication predicts the demise of some of the world’s most recognizable brands, including Sony Pictures, American Apparel and Nokia.

What separates brands that falls to digital evolution from those that excel is the ability to recognize the need for change and the vision to blaze a path toward renewed relevance among a new generation of consumers.

Branding is More Important Than Ever before

In 1984, Apple stunned the world with its now iconic “1984” commercial. It firmly established Apple’s brand and ultimately set the stage for the company’s significance in the emerging personal computers market. The commercial attained legendary status, but Apple, like every brand, would still need to relentlessly compete for attention and relevance.

A year later, Apple attempted to match its previous success with “Lemmings,” a commercial that dramatized the lemming-like behavior of the PC-based workforce. The ad, while arguably brilliant, was widely considered a flop, since following the image of businessmen following one another over a cliff confused customers. Over time, Apple’s brand slowly degraded, losing touch with its core audience and missing an opportunity to connect with the growing base of consumers seeking personal computers.

Could America’s electrical grid be targeted by terrorists or hostile foreign states? Anything’s possible. Is a catastrophic electrical grid attack likely? The House of Representatives held a hearing this morning on “smart grid” attacks–and it appears that modernization of electrical utilities nationwide has left huge security loopholes that hackers can exploit.

The hearing, held by the Oversight & Investigations Subcommittee of the House Energy & Commerce Committee, featured testimony by officials from the Government Accountability Office (GAO), and the Congressional Research Service (CRS). National Security Agency head Gen. Keith Alexander has previously told the White House about his fears that Anonymous could attack America’s electric grids and cause blackouts.

Rep. Henry Waxman (D–CA) expressed concerns about “unexpected terror attacks or hacking attempts” against America’s energy infrastructure. Another subcommittee member, Rep. Diana DeGette (D–CO) noted that smart grid technology–which connects electrical grid infrastructure to the Internet for cost-savings, ease of use, and added services for consumers–is also uniquely at risk from damage by malicious hackers.

Our Representatives are right about the risk… though, to Gen. Alexander’s detriment, it’s not from Anonymous. Gregory C. Wilshusen of the GAO gave sobering written testimony. While the conversion to a smart grid has modernized America’s electrical infrastructure, neither the government nor utility firms have been acting to close urgent security gaps. No monitoring is taking place of electrical utility providers to guarantee that even minimal cybersecurity standards are being put into place. No trade group or coordinating organization has created metrics to measure cybersecurity for energy suppliers. Information-sharing between utility providers is still the exception to the rule. Most worryingly of all, new smart grids still do not include basic event logging and forensic capabilities.

Anonymous spokespersons have explicitly stated that the hacktivist collective is not interested in smart grid attacks. In a post on the quasi-official AnonOps Communications blog, Anonymous responded, saying “Ridiculous! Why should Anonymous shut off power grid? Makes no sense! They just want to make you feel afraid.”

However, the threat to the electrical grid likely is not from Anonymous–it instead lies with foreign states interested in damaging the USA’s economy. In 2009, it was revealed that Chinese and Russian cyberintruders routinely break into American electrical companies. The bulk of the break-ins were discovered by American intelligence officials, not the victimized utility companies.

For more stories like this, follow @fastcompany on Twitter. Email Neal Ungerleider, the author of this article, here or find him on Twitter and Google+.

Image: Flickr user Lydiashiningbrightly

Guest post by Ekaterina Walter, a social media strategist at Intel. She was recently elected to serve on the Board of Directors of Word of Mouth Marketing Association (WOMMA). Follow her on Twitter

With the growth of social media and all the two-way channels of communication open to organizations, brand identity is potentially stronger but more at-risk than ever. Losing control of your brand’s ‘voice’ can be hugely damaging. And companies who have been brand-jacked, that is, had their brand hijacked, often move quickly to shut down the problem. But brand-jacking doesn’t have to be a negative thing. Companies that have learned lessons from the feedback it has given them can grow from the experience. Let’s look at the good, the bad and the ugly of brand-jacking.

Cultural awareness

Writers who long for their characters to take on a life of their own would give their right arm to see their creations appearing on Twitter with their own profiles. Lord Voldemort, Darth Vader, Frodo Baggins and Edward Cullen all tweet regularly. Some accounts are more flattering to the original creation than others, and at some point brand managers have to decide how far they are comfortable in letting these unauthorized versions take the joke. AMC famously blocked the unofficial (but character-faithful) Twitter accounts of the Mad Men characters, only to backtrack when fans complained. AMC may have realized too late that social media character-jacking can be a sincere form of flattery and the ultimate proof that your fictional creation has made the transition to cultural relevance.

Identity jacking

Twitter-jacking isn’t limited to fictional characters. When your name is also your brand, this can potentially be very damaging. Celebrities and politicians have had their social media accounts hacked, and there can be multiple fake accounts for high-profile individuals at any one time. While Barack Obama, Sarah Palin, Britney Spears and Miley Cyrus have all been victims of malicious hacking, some fake accounts are more amusing than malevolent. Many are so obviously fake as to not cause offense. Some are created for a satirical or surreal purpose.

Bad PR

The creation of malicious fake Twitter accounts can be equally detrimental to companies and organizations. There have been many examples of Twitter accounts being hijacked in protest to a company’s unpopular policy or handling of an event. Oil companies Exxon Mobil and BP have both been victims of Twitter impersonation, and following BP’s handling of the 2010 Deepwater Horizon oil spill disaster, the satirical @BPGlobalPR has attracted over 160,000 followers.

While this can be seen as a brand disaster, a company wishing to engage in some positive PR could use the feedback such channels offer to gauge the public’s perception and respond accordingly. Contrast the endless examples of companies who delete negative blog and Facebook posts with the policy of the @virginmedia team. The company makes a point of responding to every customer online mention whether it is positive or not. In one case, a woman tweeted that her Virgin Media connection wasn’t working and her two year-old daughter was upset at having to miss her favorite TV show, Peppa Pig. Not only did Virgin send an engineer immediately, he was carrying a Peppa Pig toy for the little girl. Think what this type of response can do for your brand perception, loyalty and preference!

Fake Amazon reviews and tags

Following the popularity of the Amazon ‘The Mountain Three Wolf Moon Short Sleeve Tee‘ prank, protesters have begun to use Amazon’s open review and tagging model to highlight unpopular products or issues. The pepper spray used in the UC Davis Occupy incident has been given over 360 tongue-in-cheek reviews on its Amazon page, as well as satirical product images and tags such as ‘tools of fascism’, ‘oppression’ and ‘police state.’ Note, the product is currently listed as unavailable. Similar cynical additions have crept into otherwise serious product pages, particularly books by controversial public figures or products by companies with disputed ethical practices.

Aspirational branding

One problem facing aspirational, luxury brands is when their product is adopted by an undesirable demographic, which can lead to the alienation of their core customers. This occurs most commonly with name-checking by rappers or in popular culture although it is rarely a serious concern.

A more serious predicament is when the product has such an identifiable design that a mainstream take-over can have a disastrous effect. This happened in the 1990s in Britain to Burberry when its iconic tartan pattern became popularized by soccer players, then adopted by working-class fans who wore cheap imitations to such an extent that its customer base abandoned it in droves.

Image: goodhumormarketing.com

Knowing where to draw the line

Brand managers are always going to want to deal with a negative image but sometimes an over-reaction can lead to more bad publicity than simply doing nothing. The recent attempts by Stella Artois to move away from their ‘wife beater’ stereotype. For those who don’t know, the beer’s high percentage of alcohol was allegedly linked with violence and anti-social behavior in Europe. When the company attempted to make changes to its Wikipedia page to remove the ‘wife beater’ reference, it backfired when the deletion was traced back to its own lobbying group. Given Wikipedia’s ethos of user-generated material, this led to a backlash that was quickly picked up in the press. The references were restored on Wikipedia, but the negative publicity had already reached a far wider audience than the original Wikipedia article.

The good side of brand-jacking

But image hijacking can work the other way. Corona was originally marketed in the USA as a Mexican beer for Mexican people. Then, it was adopted by surfers in the 1970s who identified with it as a ‘beach beer’. They helped to popularize Corona among the wider population and by the late 1990s, it had overtaken Heineken as the number one imported beer.

Customer evangelism

It can be difficult for companies to let go of their tightly-controlled image and allow fans to steer the direction of a brand. But the enthusiasm of fans can be instrumental in popularizing products or media. Coca-Cola’s fan-created Facebook page was the second most popular page on Facebook in 2009. Company representatives asked to partner with them rather than demanding to take it down, realizing the power of fan-driven social media. Many brands choose to create an official page alongside unofficial ones knowing that heavy handed attempts to block fan pages can lead to a damaging backlash. Although, there is always the problem that a site’s popularity can be potentially damaging if it publishes unfavorable news or views about the company to thousands of followers.

Conclusion

The rise of social media has given customers unprecedented access to brands. This can be a double-edged sword: companies are able to communicate with customers in more ways than ever, but brand managers need to be aware that communication is a two-way process. Customer expectations have risen accordingly and they are willing to act against companies who don’t meet their expectations. Managing communications successfully, however, can be enormously valuable to a company that recognizes the importance of its customers’ voice.

Registered Image: Shutterstock

At first glance, Nashville-based Gibson Guitar and Armonk-based IBM are about a million miles apart in almost every way imaginable. Privately held Gibson makes musical instruments, many of them by hand, much the same way they did 100 years ago. Publically held IBM continues to reinvent itself, delivering service and technology that wasn’t imaginable a century ago.

Nonetheless, both of these brands are leaders in their respective arenas–Gibson the artist, if you will, and IBM the scientist. More profoundly, both companies share a common commitment to their communities as exemplified by Gibson’s GuitarTown and IBM’s The Great Mind Challenge. A closer look at these two programs will reveal the art and science of doing well by doing good.

You’ve Got to Start Somewhere (So Just Start)
When Nina Miller, now President of the Gibson Foundation, first approached the CEO of Gibson (Henry Juszkiewicz) in late 2003 about the idea of a public arts project featuring 10-foot guitars crafted by local artists, she was in unchartered waters. “I went and got permission from the mayor’s office and then I kind of figured it out from there,” recalls Miller. Six months and a lot of hard work later, 50 giant guitars adorned Nashville’s sidewalks and over $400,000 had been raised for local charities by auctioning off the guitars.

Also conceived in 2003, the Great Mind Challenge started in India as IBM looked to educate the next generation of IT workers. Since then, it has become a “global academic initiative” in which classrooms become laboratories for solving actual business challenges and students engage with outside thought leaders. Interestingly, this program is just now launching in the U.S. at San Jose State University. SJSU Professor Larry Gee, who is running the program, elaborates, “Students work on real business problems in real time to learn and apply social business tools and processes.”

You Can’t Do Good All By Yourself
GuitarTown is a complex program that involves artists, musicians, city governments, and numerous sponsors. Artists create the guitars, the musicians lend their celebrity by signing the sculptures, cities provide the public art space, and sponsors defray the costs. “We did want it to be a community effort,” Miller says. Because each participant had something to gain from being involved in the program, all were eager to get on board.

Similarly, The Great Mind Challenge brings together a broad cross-section of talent. “Students receive education, tuition and mentoring from social business thought leaders, authors, top executives in the social business arena and, of course, IBM social business experts,” says Michael Riegel, IBM’s VP of Academics and Startups. And while the students are learning, corporations get fresh thinking about their challenges and universities gain access to new technology they might not otherwise afford.

Good for the Brand Is Good, Too
While GuitarTown generates goodwill by creating public art and donating auction proceeds to a broad range of nonprofits, the core of this program is a celebration of guitars and the musicians who play them. The art itself, after all, is inspired by the iconic Les Paul and Chet Atkins model guitars. Additionally, the musicians/celebrities who sign these larger-than-life sculptures are essentially endorsing the Gibson brand, albeit for socially conscious purposes. Ultimately, the good that comes out of GuitarTown leads to positive associations with the Gibson brand.

The connection between IBM’s most recent program with San Jose State and IBM’s push around “social business” is obvious. But that doesn’t make it less “good,” especially to the students enrolled in the program. “When you are given access to the latest materials and platform to create a social business, then this is collaboration at its highest–this is where academia and business intersect,” explained SJSU’s Gee. This is a win-win scenario, in which what’s good for the brand is also good for the community.

Doing Good Is a Journey, Not a Destination
After a successful debut in Nashville, GuitarTown has been rolled out in successive years to Austin, London, Orlando, Miami, and LA’s Sunset Strip, raising over $2 million to date. Gibson just announced that Waukesha, Wisc., the birthplace of Les Paul, will be the next stop. Resisting the temptation to try something new, Gibson has stuck with the program, evolving along the way. “Each city has handled it a little differently, yet each delivered great publicity for Gibson and several charitable causes in each city,” Miller said.

Although IBM just introduced The Great Mind Challenge in the U.S., the program has grown steadily on a global basis. Riegel reports that this unique initiative “has attracted over 100,000 students and hasn’t only focused on social business skills–IBM is also mentoring students in key areas of technology and engineering, including analytics, programming and software development.” Companies that are looking to do well by doing good should take note that such programs require a long-term commitment.

These two exceptionally “good” programs have many other commonalities. First, both are from brands that are well respected in their fields, which, Miller says, “opens a lot of doors.” Both look a lot like marketing as service, providing demonstrable value (versus traditional advertising messaging) that enables a deeper and more meaningful relationship with a broad target audience. Finally, there is a lot more to each of these than I could squeeze into 900 words–so be sure to see my interviews with Gibson’s Nina Miller, SJSU’s Larry Gee and IBM’s Michael Riegel on TheDrewBlog.com.

Images: Flickr users Isamel Munoz, and Thelonious Gonzo

Going into 2012, I’m thinking that we are very responsible to consider what we publish and curate as media channels, should attention, platform-building, and better community relationships be our goal. In thinking about all your various uses of social networks, if you are working with the mindset that they are all tied together as a larger media property for yourself, it becomes important to think about what you’re putting through those channels. Attention is a currency, and if we spend too much of other people’s attention on frivolous posts and shares, we risk losing that attention.

The Social Analyst is a column by Mashable Editor-at-Large Ben Parr, where he digs into social media trends and how they are affecting companies in the space.

It’s safe to say that AT&T CEO Randall Stephenson has had a pretty awful couple of weeks.

When AT&T announced its blockbuster acquisition of T-Mobile, it seemed as if a fundamental shift in the wireless market was inevitable. Even with opposition from Sprint, many assumed AT&T’s strategic planning and lobbying dollars would win it approval for the $39 billion deal.

All of AT&T’s plans are out the window now, though.

Late last month, in a surprisingly swift move, the U.S. Department of Justice moved to block the deal. The DoJ filed a civil antitrust lawsuit backed by the FCC, drastically reducing the chances that the wireless giant could complete the merger.

AT&T and Deutsche Telekom (parent company of T-Mobile USA) quickly moved to downplay the decision, claiming that they were “confident that this merger is in the best interest of consumers and our country, and the facts will prevail in court.”

Since then, two more parties have gotten involved on each side of the debate. On one side, 15 Democratic members of the House of Representatives sent a letter to President Obama urging his administration to resolve its concerns about the deal and “approve the proposed merger between AT&T and T-Mobile USA.”

On the other side, seven states this week joined the Department of Justice lawsuit. California, Illinois, Ohio, New York, Massachusetts, Pennsylvania and Washington are now parties to the case. Their entry doesn’t bode well for AT&T.

The Possibilities

1. DoJ wins its case and blocks the AT&T merger.

2. AT&T wins its case and the merger moves forward.

3. AT&T withdraws its acquisition before a decision is rendered.

4. AT&T and the DoJ settle the case, and the merger moves forward with conditions.

Of the four, #2 is the most unlikely. The DoJ doesn’t like picking antitrust fights it cannot win, and AT&T would definitely have to find creative ways to convince a judge that a T-Mobile acquisition wouldn’t hurt competition. Outcome #1 is also unlikely — we believe that AT&T would withdraw its acquisition before suffering an embarrassing defeat in court.

That leaves either a settlement or a withdrawal of its acquisition. It’s clear at this point that AT&T is hoping to find some way to settle with the DoJ to get the deal done. “We have been and remain interested in a solution that addresses the DOJ’s issues with the T-Mobile merger,” AT&T said in a statement when the news broke of the seven states joining the DoJ’s case.

In the end, this could all be posturing by the DoJ to get concessions out of AT&T before approving the deal. More likely though, this is the DoJ putting its foot down on a deal that many (including me) believe to be bad for consumers.

AT&T’s arguments that the deal will not hurt competition sounds like convoluted drivel from desperate spin doctors. One of the company’s big arguments — that the merger would bring 4G LTE coverage to rural areas faster — was quickly destroyed after a leaked letter revealed AT&T could make the same 4G LTE upgrades for $3.8 billion, a fraction of the cost of T-Mobile.

The bottom line is this: The merger is anti-competitive no matter how you slice it, and there was no way the DoJ could let this deal pass.

It’s not the outcome Randall Stephenson was hoping for. AT&T is going to experience a lot more pain before the outcome of this case is finally decided.