LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS

LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS

LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS: CONCEPTS, CONTENTS, AND CONTEXTS by CAROLINE GRAHAM AUSTIN (Under the Direction of George M. Zinkhan...

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LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS: CONCEPTS, CONTENTS, AND CONTEXTS by CAROLINE GRAHAM AUSTIN (Under the Direction of George M. Zinkhan) ABSTRACT The primary motivation of this dissertation is to identify how trends in lifestyle branding have influenced, and been influenced by, peer-to-peer marketing communications. We strive to discover the implications – for consumers and organizations – of an increasing level of complexity in capitalist marketing systems. In our first study, we present a classification scheme that displays the essential attributes of seven similar types of brands. Synthesizing academic, managerial and popular source materials, we distinguish these related, but different, brand types. Understanding lifestyle brands – what they are, how they are developed, how they are received, why they are effective, what is not a lifestyle brand – is key to understanding contemporary thinking about the relationships between and among consumers, marketers, and culture. Our second study is a classification of consumer-based promotional methods, and provides definitions and rationales for the use of these marketing techniques. Using theoretical concepts related to self-creation in a postmodern marketplace, we construct and present a classification scheme and explain its utility. Our third consists of a case-based study.We develop a theory-in-use of managerial selfbrand awareness that we name “strategic empathy.” We also present a conceptual model of lifestyle branding and strategic empathy, as well as propositions for how concepts, contexts, and produsers affect each other and the meaning of lifestyle brands. We highlight which of these propositions are unique to lifestyle brands, and frame questions to guide future research.

INDEX WORDS:

Lifestyle brands, peer-to-peer communication, relationship marketing, conceptual modeling, qualitative research, organizational behavior, theory development, symbolic interactionism, self-brand identification, postmodern theory

LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS: CONCEPTS, CONTENTS, AND CONTEXTS

by

CAROLINE GRAHAM AUSTIN B.A., Mercer University, 1994 M.A., The University of Notre Dame, 1996

A Dissertation Submitted to the Graduate Faculty of The University of Georgia in Partial Fulfillment of the Requirements for the Degree

DOCTOR OF PHILOSOPHY

ATHENS, GEORGIA 2008

© 2008 Caroline Graham Austin All Rights Reserved

LIFESTYLE BRANDS AND PEER-TO-PEER COMMUNICATIONS: CONCEPTS CONTENTS, AND CONTEXTS

by

CAROLINE GRAHAM AUSTIN

Electronic Version Approved: Maureen Grasso Dean of the Graduate School The University of Georgia August 2008

Major Professor:

George M. Zinkhan

Committee:

Vanessa M. Patrick Robert J. Vandenberg

iv

DEDICATION For my family.

v

ACKNOWLEDGEMENTS Thanks to the following people who provided inspiration, insight, entertainment, support, care and feeding, in just the right amounts and at all the right times: Walt, Clyde, Terrell, Tucker, Campbell, and Ben Austin; my extended family; Vanessa Patrick and Bob Vandenberg; and all my teachers, friends and colleagues at UGA, Mercer, and Montana State University. Special thanks to George Zinkhan, an excellent mentor, editor and lunch companion. And to Jeff Wogoman, Mike Spear, Micah Rice, Kirk Smith, Charlie Mustard, focus group members, Kristi Lindsey, and Todd and Amy Madden Kinney, without whom I’d have no data. Thanks to Hanly Burton, Timothy O’Brien, Daniel Alderman, Kevin Pancich, Christy Sandstad, Kristi Lindsey (again!), and my Delphine teammates who helped enormously to help me keep body and soul together in spite of my broken leg and all its complications. Now I can play outside again! And finally, my most heartfelt gratitude goes to Tommy Bass and Amelia Fountain. Thank you for everything, especially putting up with me through all this. I promise I’ll never do it again.

vi

TABLE OF CONTENTS Page ACKNOWLEDGEMENTS.............................................................................................................v CHAPTER 1

INTRODUCTION .........................................................................................................1

2

WHAT MAKES A LIFESTYLE BRAND? A CLASSIFICATION OF BRAND TYPES.....................................................................................................................16

3

PEER-TO-PEER MEDIA OPPORTUNITIES ............................................................40

4

LIFESTYLE BRANDS, PEER-TO-PEER MARKETING, AND STRATEGIC EMPATHY..............................................................................................................76

5

CONCLUSION..........................................................................................................143

REFERENCES ............................................................................................................................160

1 CHAPTER 1: INTRODUCTION Branding is a key aspect of marketing, and it is a main way that marketing managers create value for customers. With branded products, customers have an opportunity to learn from experience. In some categories, branded products enhance consumers’ self-esteem and status. Here, we focus on a specific group of branded products – lifestyle brands. Lifestyle brands address consumers’ core values through both their tangible and symbolic qualities. Their symbolic meanings go beyond those ascribed to the products themselves. Rather, consumers hope to possess and project the qualities that these brands represent (Helman and de Chernatony 1999). Successful lifestyle brands include clothiers Fubu and Ralph Lauren, snowboard flagship Burton, Starbucks coffee shops, Subaru and Mercedes automobiles, Bang & Olufsen home electronics, Marlboro cigarettes, sportswear juggernaut Nike, and HarleyDavidson motorcycles. In the marketing literature, a number of authors have described the strong emotional connections between consumers and brands (cf. Belk 1988, Schouten and McAlexander 1995, Muniz and O’Guinn 1997, Fournier 1998, McAlexander et al. 2002; Hollenbeck et al. 2008). Lifestyle brands can elicit such emotional reactions, but go even further; they “reach a higher level in terms of the kind of connection [they] make with the customer” (Lieber 2001: 1). We propose that there are several factors that contribute to the intensity of this special connection between lifestyle brands and consumers, and offer the following definition. Lifestyle brands reflect and facilitate people’s ways of living, and enable key aspects of their consumers’ behavior. These consumers range from core users, who themselves help define the brands’ meanings, to those for whom the lifestyle is aspirational. Lifestyle brands offer multifaceted product and promotional mixes that appeal to more than a single aspect of their

2 customers’ interests, feelings and needs. Their product offerings are high quality. They strongly, consistently, and authentically espouse a set of essential values that resonates deeply with some segment of the general population. Finally, lifestyle brands consciously embrace multidirectional relationship marketing (Zinkhan 2002, Lacey and Morgan 2007), because these brands’ managers understand that brand meanings rely on input from the firm and consumers in order to achieve success in the marketplace. The lifestyle brands we examine in this dissertation have successfully entered a competitive arena by creating unique, authentic brand identities, by offering innovative products, by thinking about their core consumers’ wants, needs, and values, and by empowering these customers to disseminate marketing information on their behalf. For lifestyle brands, all these elements are seamlessly unified to create a very strong message about the brand and the lifestyle in the marketplace. Table 1.1 provides examples of lifestyle brands and non-lifestyle brands, highlighting the key attributes that the non-lifestyle brands do not possess. The strength of lifestyle branding lies in the fact that these brands do not just practice integrated marketing communications; all the elements of the marketing function (i.e., the 4 Ps) work in concert to create a single, strong, multidimensional brand identity. In this dissertation, contextual effects are a key issue. It is important to note that we conduct this research focusing on perceptions of brands in the United States, and that geography and culture are fundamental to understanding context. Therefore, our analyses of brands are informed by an American perspective; global interpretations of lifestyle branding is beyond the scope of this study. The labels “lifestyle” and “non-lifestyle” we use here are only applicable from an American point of view. Lifestyles consist of people’s activities, interests and opinions,

3 which differ considerably from country to country, as well as within national borders to a lesser degree. Contextual interpretations also encompass changing public interpretations over time. Brands that undergo significant changes during their existence may find that context alone is enough to radically alter people’s interpretations of their meanings and messages. Extending a brand’s reach is a considerable challenge, and may present a major risk for managers who have established a secure marketspace for themselves. Other aspects of contextual cues are a brand’s mass appeal, its global presence, its meanings for its home culture, and the people who use the brand. In certain circumstances, gaining popularity among the general population can actually damage the authenticity and trustworthiness that lifestyle brands cultivate among their core consumers. The names in Table 1.1 are brand names. In the case of lifestyle brands, the corporate and brand names are usually, but not always, the same. For example, Cloudveil, which used to be autonomous, is now part of the Spyder Active Sports corporate portfolio. However, Cloudveil has maintained its distinct brand identity and independent management in spite of the change in its corporate structure. Non-lifestyle brands may or may not share the names of their parent corporations; Dunkin’ Donuts is the same for the brand and the corporation, while the Snickers brand is owned by Mars, Inc. In Table 1.1, “market perception” refers to the prevailing popular opinion of the brand. These judgments come from anecdotal evidence, such as official promotional materials and public responses. “Indicators of authenticity” are based on findings by Guidry et al. (2008), and include the brand’s connections to places, core users, and events. “Marketing innovations” are a key source of differentiation for many brands, especially for lifestyle brands. These can be

4 innovations in products (e.g., design, manufacturing, packaging), in promotions, and in purchasing and distribution methods (b2b and b2c). “Expressed brand values” are those that the firm espouses in its official consumer-oriented communications. By definition, lifestyle brands’ values must correspond with consumers’ values. “Produser communications” refer to p2p communication techniques related to each brand. Most people enjoy talking about their consumption experiences (e.g., discussing movies, gas mileage, restaurants, home electronics). Lifestyle brands rely heavily on consumers to communicate brand ideas and messages to each other. Informal communication among consumers is the crux of consumer-based promotional methods. When managers successfully recruit consumers to advance their marketing activities, we label this practice as consumer-based promotion. In this dissertation, we use the terms “consumer-based promotion” and “peer-to-peer promotion” interchangeably. However, there is a distinction between peer-to-peer communication and peer-to-peer promotion: While not all peer-to-peer communication is a form of consumer-based (or peer-to-peer) promotion, all consumer-based promotions are a form of peer-to-peer (hereafter, “p2p”) communication. Under some circumstances, consumers take on the role of “prosumers” – simultaneous producers and consumers of brand messages and meanings (Toffler 1980, Tapscott and Williams 2006). Recently, this neologism has taken on a different, and more commonly understood meaning, which is a professional-level (or often, an elite amateur) consumer of high-quality, advanced-technology goods such as software, cameras, or kitchen supplies. Therefore, we prefer “produser,” a term coined by Axel Bruns in 2005. In the broader sense of this dissertation, “produser” captures the notion of a brand’s producer-users while avoiding confusion with the new meaning of Toffler’s older term.

5 Table 1.1: A comparison of lifestyle and non-lifestyle brands Lifestyle Brands Market perception Rugged, efficient, durable, fun, beloved

Indicators of authenticity In mountain towns and snowy places, for outdoors lovers, at rally car races

Marketing innovations Small AWD cars, zero landfill plant*

Wholesome, nourishing, convenient, delicious, friendly Innovative, cool, stylish, high performance, high quality

For hikers, backpackers, kayakers, cyclists, in the backcountry, at races, using wind and biodiesel energy Tied to Jackson Hole, employee users, pro fishermen, skiers & climbers

Organic foods and sports drinks, women-specific foods, recyclable packaging New fabric technologies, performance clothing design

Jones Soda: niche beverage

Cool, fun, friendly, stylish, delicious, independent, “the little guy”

Found in small shops (e.g., skateboard), consumer input on web and packaging, alternative sports venues, tied to Seattle

Jittery Joe’s: franchised coffee shop

Hip, friendly, small, inviting, sporty, local

Tied to Athens, GA, and other college towns, domestic cycling team, beans distributed in bike shops

Consumergenerated package designs, unique soda flavors, interactive website Personal distribution and promotion of beans, cycling team

Market perception Good selection & prices, convenient, friendly Delicious, satisfying, convenient

Indicators of authenticity No clear connection to location, core users, events

Sporty, casual, overpriced Hard-core, dangerous, intoxicating, extreme

Name Subaru: international brand

Clif Bar: energy bars, gels, and drinks

Cloudveil: clothing

Expressed brand values Resource conservation, superior engineering, safety, durability, love of nature Organic farming, conservation, love of nature, women’s health, pleasurable consumption Quality, technological innovation, resource conservation, durability, style, utility Supporting the everyman, uniqueness, beautiful design, independence

Produser * communications Fan websites and blogs, online forums, homemade videos and ads, clubs, unofficial contests

Local support, beautiful design, healthy living, positive social spaces and interaction

Fan websites and blogs, online forums, homemade photos and videos, fan art at races, consumer-team interactions, Patron program

Marketing innovations Online sales and distribution, accurate recommendations Uncertain

Expressed brand values Uncertain

Produser communications Gift registries & wish lists; product & vendor reviews (written & video)

Convenience

Uncertain

Tied to Ralph Lauren, sold at J.C. Penney Tied to Germany, used by rock stars and college students, found at parties and bars

Uncertain

Uncertain

Uncertain

Luxury, comfort, style, value Extreme behavior, overindulgence, risktaking

No clear connection to location, core users, events

Online sales, coffee bean subscriptions

Freshness, cleanliness, flavor, friendliness, speed

Branded clothing items, local cycling clubs (i.e., Luna Chix), blogs, podcasts, pro and amateur ambassadors Online forums and blogs, homemade videos, unofficial contests, branded clothes, pro and amateur brand ambassadors Fan websites and blogs, online forums, consumer submissions of art, writing, and music, branded products, amateur brand ambassadors

Non-lifestyle brands Name Amazon.com: international brand Snickers: candy and energy bars American Living: clothes Jägermeister: niche beverage

Dunkin’ Delicious, Donuts: convenient, franchised fattening doughnuts and coffee shop * See below for definition ** www.urbandictionary.com

Sponsors NASCAR, the NFL, Little League, bass fishing

Branded products (including clothing and other personal items), volunteer brand ambassadors, branded postcards, Urban Dictionary entries** Branded cups and clothing, corporate and personal gift ideas

6 While very highly involved, produsers are a recent development in relationship marketing, facilitated by the Internet, consumption has always evolved in tandem with marketing. Grant McCracken writes, “By the nineteenth century… the vigorous dialectic that bound consumer change and social change was … a structural reality” (McCracken 1988:29). The advent of the Internet has caused a paradigm shift in the way that people interact with each other, both as individual consumers and as agents of the firm (Watson et al. 2000). However, whether such information exchange occurs on- or off-line, brand-based p2p communication is de facto word-of-mouth advertising that companies, especially lifestyle brands, try to harness. THEORY The difference between lifestyle branding and p2p promotions is that p2p marketing is an element that is necessary but not sufficient to create a lifestyle brand. In addition to the p2p component, lifestyle brands have other critical attributes that are described in detail in this dissertation. However, both lifestyle branding and p2p promotions stem from the idea that identity signaling among consumers is a powerful market force. As such, we draw on two theories from the extant marketing-as-social-science literature in order to develop research questions. Self-brand identification (Sirgy 1982) maintains that there is congruence between a consumer’s self-image and brand image, and that brands leverage symbolic as well as concrete value for their consumers. Consumer behavior is generally predicated on the resonance between consumer self-concept (either actual or ideal) and symbolic value of a brand. This theory has been thoroughly tested and strengthened, and has become an integral part of consumer-marketing research (e.g. Belk 1988, Aaker 1991, Keller 1993, Fournier 1998, Muniz and O’Guinn 2001, Escalas and Bettman 2003 & 2005).

7 Symbolic interaction theory compliments this idea by holding that objects have meaning for all those who encounter them, and that these meanings are subject to interpretation and reinterpretation based on people’s individual use, social interactions, and contextual influences (Blumer 1969, Singelmann 1972, Solomon 1983, Zavestoski 2002, Escalas and Bettman 2005; Braun-LaTour et al. 2007). Work on consumer choice indicates that conspicuous consumption is a popular method for consumers to send signals to one another (e.g., signals related to their personality, lifestyle, and identity). For instance, Berger and Heath (2007) find that, “People use symbolic domains to make identity inferences about others, but the particular identities that are inferred depend on who else holds the taste” (Berger and Heath 2007:132). In other words, consumers attempt to understand their own and others’ personalities, values, and interests based on the brands they choose to display. These consumer-oriented theories can be applied to brand management. Self-brand identification and symbolic interaction are crucial to the development of both lifestyle branding and p2p promotions. Reciprocal symbolic relationships between self, other, and brand are implied every time marketing managers attempt to build their brands by using consumers as their message-bearers. When consumers use their favorite lifestyle brands to send messages in the marketplace, they accomplish two managerial objectives. At the most basic level, public display makes brands more prominent in the cultural landscape, contributing to low-involvement effects such as automaticity (e.g., Chartrand 2005) and mere exposure (e.g., Obermiller 1985). More importantly, brand managers hope that the reciprocal, symbolic, interpersonal relationships between produser-self, produser-other and the brand will trigger high-involvement responses – consumers’ (re)consideration of their lifestyles, consumption choices, value systems, and self-

8 concepts – based on their sense of connection with the brand and with the community of fellowprodusers. Extant research on branding indicates that, at the broadest level, management and even ownership of brands is socially negotiated in a process of multidirectional communication between and among firms and consumers, moderated by news media, advertising, government regulations, websites, and other sources/conduits of information (Keller 2003, McAlexander et al, 2002, Holt 1997, Holt 1998). Escalas and Bettman (2005) write that “brand use by reference groups is a source of brand meaning” (379), and also that “consumers appropriate the meaning of brands as they construct their self-identities, particularly brand meaning that arises from reference group use and nonuse of brands” (380). In short, consumers’ use of brands is influenced by the contexts in which they use these brands, even as these brands and consumers are simultaneously contributing to this environment. RESEARCH OBJECTIVES This dissertation is part of an emerging academic tradition called consumer culture theory (CCT), that addresses “the socio-cultural, experiential, symbolic, and ideological aspects of consumption” (Arnould and Thompson, 2005: 868). Arnould and Thompson identify four research programs in CCT: (1) consumer identity projects, (2) marketplace cultures, (3) the socio-historic patterning of consumption, and (4) mass-mediated marketplace ideologies and consumers’ interpretive strategies. This particular research is related to all four CCT elements, and contains findings that are especially relevant to the second item. The primary motivation of this research is to identify how trends in lifestyle branding have influenced, and been influenced by, peer-to-peer marketing communications. We strive to discover the implications – for consumers and organizations – of this increasing level of

9 complexity in capitalist marketing systems. Specifically, this dissertation examines the impact that peer-to-peer promotional techniques have on brand management, revolving around the increasing roles that consumers and contexts play in firms’ branding and marketing efforts. There are three main objectives for this dissertation. First, we provide a conceptual framework to explain how p2p promotions are part of the evolving, postmodern marketplace (cf. Arnould and Thompson 2005; Arias and Acebron 2001; Watson et al. 2000; Firat and Venkatesh 1995). The second objective is to extend the theories discussed above by examining multiple angles of relationship-based brand exchanges. We explore how marketing managers of lifestyle brands use p2p strategies to build their brands’ visibility and reputations. We develop 27 propositions related to lifestyle branding and a managerial theory-in-use called “strategic empathy.” The third objective is to identify potential problems and opportunities associated with these promotional tools, from a consumer’s perspective, from a managerial perspective, and from a public policy perspective. To address these objectives, we develop three general research questions: 1.

What are the salient features of lifestyle brands?

2.

What are the salient features of consumer-based marketing techniques?

3.

Which consumer-based marketing elements are most valuable for lifestyle brands to foster p2p produser communications?

BRIEF SUMMARY OF INDIVIDUAL CHAPTERS The first chapter provides an introduction to the topic, including a brief literature review, a summary of research objectives and a discussion of how this particular group of studies serves

10 to advance knowledge. Chapters 2-4 are specific, in-depth studies related to aspects of lifestyle branding, non-lifestyle branding, and peer-to-peer communications. In Chapter 2, we present a classification scheme that displays the essential attributes of seven similar types of brands, including lifestyle brands. Synthesizing academic, managerial and popular source materials, we analyze current knowledge and practice related to branding and distinguish these related, but different, brand types. Understanding lifestyle brands – what they are, how they are developed, how they are received, why they are effective, what is not a lifestyle brand – is key to understanding contemporary thinking about the relationships between and among consumers, marketers, and culture. Chapter 3 is a classification of consumer-based promotional methods and provides definitions and rationales for the use of these marketing techniques. Using theoretical concepts related to self-creation in a postmodern marketplace, we construct and present a classification scheme of consumer-based promotional methods and provide definitions and rationales for using this scheme. Chapter 4 consists of a case-based study, where we interview marketing executives from three successful lifestyle brands (Jones Soda, Cloudveil outdoor apparel, and Jittery Joe’s coffee shops) that have pursued p2p promotions as a primary means of disseminating their marketing messages. We examine the strategic and tactical processes that lifestyle brand managers use to navigate the peer-mediated marketplace and develop a theory-in-use (Zaltman et al. 1982) of managerial self-brand awareness that we name “strategic empathy.” We also present a conceptual model of lifestyle branding and strategic empathy, as well as propositions for how concepts, contexts, and produsers affect each other and the meaning of lifestyle brands. In developing these propositions, we compare lifestyle and non-lifestyle brands, offer support from

11 the extant literature on branding, highlight which of these propositions are unique to lifestyle brands, and frame questions to guide future research. The fifth chapter provides a summary of findings across studies. Topics in this chapter include: theoretical implications; managerial implications; limitations; and future research (including specific methods and designs to guide subsequent inquiries). CONTRIBUTION Stanford University linguist Geoffrey Nunberg has coined the term lingua branda to describe the way in which commercial language has skipped across geographic boundaries, uniting people around the globe with an ever-growing vocabulary of ubiquitous yet proprietary brand names (Nunberg 2004b). In a radio commentary broadcast, he states: The great brands don't belong to any single language – they're part of a new global tongue, the Esperanto of the check-out stand. You may not know how to say "soft drink" or "athletic shoe" in Italian, but nowadays you can always get by in Rome by asking for a Coca-Cola or Nikes. From an international point of view, those are the real common nouns now. We're all drawn together under the international lingua branda, with only our separate verbs to keep us apart (Nunberg 2004a). This concept has both intuitive appeal and ecological validity, and it raises, rather than answers, a fundamental marketing question, namely, what does a lifestyle brand (such as Nike) communicate between people, beyond commercial information? Peñaloza and Venkatesh (2006) encourage researchers to view producer/consumer relationships as subject/subject interactions, rather than subject/object (308). As they point out, “marketers consume and consumers produce” (303). Everyone is a potential “produser” (Bruns 2005). In this dissertation, we discover that marketing managers are themselves simultaneous producers and consumers of their brands’ meanings and values, and posit that this position is a strategic asset that facilitates successful lifestyle branding.

12 This dissertation contributes to marketing theory and practice by examining lifestyle branding and the complex relationships that it relies on to be successful. We strive to advance our understanding of the relationships between consumers and producers, brands and lifestyles, contexts and contents. These research findings advance theory related to the modern culture of consumption. Brand managers also benefit from this examination of the trends and themes in consumer-based promotions. By defining what lifestyle brands are and are not, identifying and classifying p2p promotional techniques, and interviewing managers who are the primary produsers of lifestyle branding, we gain a holistic understanding of when, how, and why lifestyle brands and p2p marketing are successful. In the next chapter, we examine lifestyle branding relative to other brand types. We present a classification scheme and provide definitions for different brand types and their underlying attributes. We also identify the implications of this research for theory and practice.

13 REFERENCES Aaker, David A. (1991), Managing brand equity: Capitalizing on the value of a brand name. New York: Free Press. Arias, J. Tomas and Laurentino Bello Acebron (2001), “Postmodern approaches in business-tobusiness marketing and marketing research,” The Journal of Business & Industrial Marketing, vol. 16, 7-20. Arnould, Eric J., and Craig J. Thompson (2005), “Consumer culture theory (CCT): Twenty years of research,” Journal of Consumer Research, vol. 31 (4), 868-882. Belk, Russell (1988) “Possessions and the extended self,” Journal of Consumer Research, vol. 15 (2), 139-168. Berger, Jonah and Chip Heath (2007), “Where Consumers Diverge from Others: Identity Signaling and Product Domains,” Journal of Consumer Research, August, vol. 34 (August), 121-134. Blumer, Herbert (1969). Symbolic Interactionism: Perspective and Method. University of California Press, Berkeley and Los Angeles: CA. Braun-LaTour, Kathryn, Michael Latour, and George M. Zinkhan (2007), “Using Childhood Memories to Gain Insight into Brand Meaning,” Journal of Marketing, 71 (April), 45-60. Bruns, Axel (2005), Gatewatching: Collaborative online news production. New York: Peter Lang Publishing, Inc. Chartrand, Tanya L. (2005), “The Role of Conscious Awareness in Consumer Behavior,” Journal of Consumer Psychology, vol. 15 (3), 203-210. Escalas, Jennifer Edson and James R. Bettman (2003), “You Are What They Eat: The Influence of Reference Groups on Consumers’ Connections to Brands,” Journal of Consumer Psychology, vol. 13 (3), 339–348. ________ and James R. Bettman (2005), “Self-Construal, Reference Groups, and Brand Meaning,” Journal of Consumer Research, vol. 32 (4), 378-389. Firat, A. Fuat and Alladi Venkatesh (1995), "Liberatory Postmodernism and the Reenchantment of Consumption," Journal of Consumer Research, vol. 22 (3), 239-267. Fournier, Susan (1998), “Consumers and Their Brands: Developing Relationship Theory in Consumer Research,” Journal of Consumer Research, vol. 24 (March), 343-373. Ganesan, Shankar (1994), “Determinants of Long-Term Orientation in Buyer-Seller Relationships,” Journal of Marketing, 58 (April), 1-19.

14 Helman, Deborah and Leslie de Chernatony (1999), “Exploring the Development of Lifestyle Retail Brands,” The Service Industries Journal, vol. 19 (2), 49-68. Hollenbeck, Candice, Cara Peters, and George M. Zinkhan (2008), “Retail Spectacles and Brand Meaning: Insights from a Brand Museum Case Study,” Journal of Retailing, forthcoming. Holt, Douglas (1997), “Poststructuralist Lifestyle Analysis: Conceptualizing the Social Patterning of Consumption,” Journal of Consumer Research, vol. 23 (March), 326-350. ________ (1998), “Does Cultural Capital Structure American Consumption?” Journal of Consumer Research, vol. 25 (June), 1-25. Keller, Kevin Lane (1993), “Conceptualizing, Measuring, and Managing Customer-Based Brand Equity,” Journal of Marketing, vol. 57 (January), 1-22. ________ (2003), “Brand Synthesis: The Multidimensionality of Brand Knowledge,” Journal of Consumer Research, vol. 29 (March), 595-600. Lacey, Russell and Morgan, Robert M. (2007), “Committed Customers as Strategic Marketing Resources,” Journal of Relationship Marketing, vol. 6 (2), 51-66. Lieber, Ron (2001), “Trendsetter – Hilary Billings,” Fast Company, vol. 52 (November), 130. McAlexander, James H., John W. Schouten, and Harold Koenig (2002), “Building Brand Community,” Journal of Marketing, vol. 66 (January), 38-54. McCracken, Grant (1988), Culture and Consumption: New Approaches to the Symbolic Character of Consumer Goods and Activities, Bloomington, IN: Indiana University Press. Muniz, Albert M. and Thomas C. O’Guinn (2001), “Brand Community,” Journal of Consumer Research, vol. 27 (4), 412-432. Nunberg, Geoffrey (2004a), “Branding the Phonetosphere,” Fresh Air, National Public Radio Commentary, September 4. ________ (2004b), Going Nucular: Language, Politics, and Culture in Confrontational Times, New York: PublicAffairs Books. Obermiller, Carl (1985), “Varieties of Mere Exposure: The Effects of Processing Style and Repetition on Affective Response,” Journal of Consumer Research, vol. 12 (1), 17-30. Peñaloza, Lisa and Alladi Venkatesh (2006), “Further Evolving the New Dominant Logic of Marketing: From Services to the Social Construction of Markets,” Marketing Theory, vol. 6 (3), 299-316.

15 Schouten, John and James H. McAlexander (1995), "Subcultures of Consumption: An Ethnography of the New Bikers," Journal of Consumer Research, vol. 22 (June) 43-61. Singelmann, Peter (1972), “Exchange as Symbolic Interaction: Convergences Between Two Theoretical Perspectives,” American Sociological Review, vol. 37 (August), 414-424. Sirgy, M. Joseph (1982), “Self-concept in Consumer-Behavior: A Critical Review,” Journal of Consumer Research, vol. 9 (3), 287-300. Solomon, Michael R. (1983), “The Role of Products as Social Stimuli: A Symbolic Interactionism Perspective,” Journal of Consumer Research, vol. 10 (4), 319-329. Tapscott, Don and Anthony D. Williams (2006), Wikinomics: How Mass Collaboration Changes Everything, New York: Portfolio. Toffler, Alvin (1980), The Third Wave, New York: Bantam Books. Watson, Richard T., Pierre Berthon, Leyland F. Pitt, and George M. Zinkhan (2000), Electronic Commerce: The Strategic Perspective, Fort Worth: Dyden Press. www.urbandictionary.com Zaltman, Gerald, Karen LeMasters and Michael Heffring (1982), Theory Construction in Marketing: Some Thoughts on Thinking, New York: John Wiley & Sons. Zavestoski, Stephen (2002), “The Social-Psychological Bases of Anticonsumption Attitudes,” Psychology and Marketing, vol. 19 (2), 149-165. Zinkhan, George M. (2002), “Relationship Marketing: Theory and Implementation,” Journal of Market-Focused Management, vol. 5, 83-89.

16

CHAPTER 2 WHAT MAKES A LIFESTYLE BRAND? A CLASSIFICATION OF BRAND TYPES1

1

Austin, C.G. and G.M. Zinkhan. To be submitted to Journal of Marketing.

17 INTRODUCTION Lifestyle brands have received a lot of coverage in the popular press (e.g., Lieber 2001, Kiley 2005, McGruder 2005, Kannan 2007, Scott 2007). Both academics and managers recognize that lifestyle branding is a strategic practice that is effective in a cluttered marketplace (Kitchen et al. 2004, Rosengren 2006, Rumbo 2002, Austin et al. 2005). While the notion of lifestyle branding is relatively new, it has much in common with other specifically identified types of brands (e.g., pioneering brands, niche brands, iconic brands, authentic brands). There has yet to be an academic article published that identifies how each of these classifications of brands is related to, yet different from all the others. Helman and de Chernatony (1999) come close, placing what they call “lifestyle retail brands” into a postmodern consumption context, but they do not clearly articulate all the differences between these and other similar developments in branding. This chapter presents a classification scheme (Hunt 1976) based on existing categories (i.e., brand types) that have been used, sometimes interchangeably, in marketing practice. Lifestyle brands reflect and facilitate people’s ways of living, and enable key aspects of consumer behavior. These consumers range from core users, who themselves help define the brands’ meanings, to those for whom the lifestyle is aspirational. Lifestyle brands offer multifaceted product and promotional mixes that appeal to more than a single aspect of their customers’ interests, feelings and needs. Their product offerings are high quality. They strongly, consistently, and authentically espouse a set of essential values that resonates deeply with some segment of the general population. Finally, lifestyle brands consciously embrace multidirectional relationship marketing (Zinkhan 2002, Lacey and Morgan 2007), as their brands’

18 managers understand that brand meanings rely on input from the firm and consumers in order to achieve success in the marketplace. Understanding lifestyle brands in particular – what they are, how they are developed, how they are received, why they are effective – is key to understanding relationships between and among consumers, marketers, and culture. In postmodern society, consumers use brands to help create private, personal identities (e.g., Firat and Venkatesh 1993, Belk 1988, Klein et al. 1995, Sirgy 1982, Solomon 1983, Fournier 1998, Muniz and O’Guinn 2001). Social scientists have long recognized that clothing and personal adornments constitute a vocabulary that people deploy, literally from the day they are born, to communicate personal information to others. RESEARCH OBJECTIVES The first objective of this chapter is to clarify the similarities and differences among several related brand types. We do so by creating a classification scheme that shows which attributes each brand type does and does not possess. The second objective is to use extant academic and managerial literature to clearly define what a lifestyle brand is, and to provide examples of lifestyle and non-lifestyle brands. The third objective is to identify areas for future research that come out of this classification project. Table 2.1 is a classification scheme that displays the essential attributes of seven similar types of brands. We define each attribute, using sources from the academic literature. We also define each brand type, based on the use of the name (e.g., niche brand) in academic, managerial, and popular publications*. Within each brand type, we offer exemplars with a brief description of how and why each fits into the schema. We also look at special cases and explain why they are *

While we rely most heavily on peer-reviewed material to inform these definitions, we look closely at other sources to affirm that business writers, brand managers and marketing researchers are in agreement as to what these terms mean to the people who use them. The simultaneous construction of Table 2.1 and accompanying definitions has been an iterative process, using the literature and “real world” experiences. Note the lack of consensus on the meaning of iconic brands.

19 difficult to classify. Finally, we note what implications this system of classifying and defining various types of branding will have, both for managers and for academics, and examine its potential for future research. There is not a traditional literature review in this chapter, because the following definitions serve this purpose. For each brand type and attribute, we provide citations from seminal or comprehensive articles that illuminate these ideas. We have synthesized this information in order to present a holistic view of contemporary branding methods and academic thinking on how and why these methods appeal to consumers.

Table 2.1: A comparison of attributes among similar brand types

uniqueness nostalgic/emoti onal value price risk association quality/ excellence sensory appeal sign value personification interactivity facilitation necessity stability internal consistency longevity rituals market share prototype/ normative familiarity cultural barometer mythology

x x

x x

x

x x x x x

x

x

x

x x

x

x x x

x

x x

x x

Lifestyle

Authentic

Pioneering

Dominant

High involvement

Niche

Iconic (Holt)

Brand attributes

Iconic (others)

Brand types

x

x x

x

x x x x x

x x x x

x

x

x

x x

x

x x

x

x

x x x x x

x

x x

x x

x x

x

x

20 values

x

DEFINITIONS OF ATTRIBUTES The first 11 of these definitions are either adapted or come directly from Charles Martin (1998), who studies involvement between consumers and product categories; we find them to be especially useful for categorizing brand types as well. Martin selects these attributes for being “both managerially actionable and capable of discriminat[ion]” (12). They work very well here, with some modifications, to distinguish between the types of brands under examination in this investigation. Items 12-14 come from Guidry, Zinkhan and Tam (2008), who have also identified attributes that are incorporated in Martin’s categories (e.g., Guidry et al. identify “ties to place” and “ties to owner,” distinctions that fall together here under the single label “association”). Following Martin’s guidelines, we have added the last 7 attributes in the table based on the branding literature. 1. Uniqueness: a somewhat rare brand with uncommon characteristics, or one that is clearly differentiated from other brands in the product category 2. Nostalgic/emotional value: sentimental linkages with some aspect of the user’s, the culture’s, or the brand’s identity 3. Price risk: the consumer may be concerned about the purchase price, replacement price or other expenses associated with the brand – such as insurance, storage or repair costs 4. Association: the extent to which the brand is linked to other people, places, organizations, activities, events, issues, other brands or images 5. Quality/excellence: the overall superiority or excellence of the brand on one or more key attributes 6. Sensory appeal: the brand’s attractiveness or artistic value, or qualities related to the way its products look, feel, taste, smell or sound 7. Sign value: how conspicuously the brand is displayed by the user, and is congruent with the user’s self-identity (Sirgy 1982) 8. Personification: the brand has a personality that resembles human characteristics (Aaker

x

21 1997) 9. Interactivity: the brand and/or its marketing techniques engage consumers, requiring or inviting them to exert mental or emotional energy on its behalf (Austin et al. 2007) 10. Facilitation: the ability of the brand to help the user engage in preferred behaviors or attain important personal goals 11. Necessity: the ability of the brand’s products to help the consumer perform a vital or important task 12. Stability: the perception that the brand is unchanged, constant, and enduring (Guidry et al. 2008) 13. Internal consistency: the perception that the meanings associated with the brand are interrelated and coherent 14. Longevity: the brand has been in existence for a long time 15. Rituals: sets of multiple, symbolic behaviors that occur in sequence and are periodically repeated (Arnould et al. 2002) 16. Market share: the brand controls a large proportion of the total sales in its category (Bloom and Kotler 1975) 17. Prototype/normative: consumers evaluate other brands based on prevailing beliefs and attitudes towards this brand (Mao and Krishnan 2004) 18. Familiarity: how well known the brand is to the general population 19. Cultural barometer: the extent to which the brand addresses a prevalent view of society (Holt 2004) 20. Mythology: the brand embodies a story that resonates with deeply held social ideals (Holt 2004) 21. Values: the brand’s ability to communicate a set of core values that are important to the brand, its employees, and the consumer (Harris and de Chernatony 2001)

22

DEFINITIONS OF BRANDS Iconic brands Key attributes (Holt): uniqueness, nostalgic/emotional value, association, facilitation, rituals, cultural barometer, mythology, values Key attributes (others): uniqueness, nostalgic/emotional value, association, quality/excellence, sensory appeal, sign value, personification, facilitation, stability, longevity, prototype/normative, familiarity, mythology In 2004, Douglas Holt published the most comprehensive work to date on iconic brands. His “axioms of cultural branding” are that 1) Iconic brands address acute contradictions in society 2) Iconic brands perform identity myths that address these desires and anxieties 3) Identity myths reside in the brand, which consumers experience and share via ritual action 4) These identity myths are set in populist worlds 5) Iconic brands perform as activists, leading culture 6) Iconic brands rely on breakthrough performances, rather than consistent communications 7) Iconic brands enjoy a cultural halo effect (Holt 2004, 6-10) Holt argues that iconic brands’ value “stems primarily from storytelling rather than how well the product works” (224), and names Mountain Dew, Volkswagen, Budweiser, Harley Davidson, ESPN and Nike as definitive iconic brands. He excludes Apple, Polo, Coca-Cola, Corona, and BMW as possible iconic brands. Holt’s work in some ways contradicts much (if not most) of the other writing about branding, whose authors would likely object to the latter brands’ not being considered iconic. After all, the word “iconic” is popularly used to describe ubiquitous cultural symbols, such as the Coca-Cola logo. There are points of intersection between Holt’s conceptualization and the more commonly used ideas regarding iconic brands. The major distinction is that Holt draws a tighter

23 circle around the definition than most others would; all the brands on Holt’s list would also qualify as iconic according to current managerial standards. Both definitions are based on the notion that iconic brands hold a substantial amount of “culture share” (Holt 2004). In the more commonly held view, a brand achieves iconic status through consistent messages that telegraph who the brand is and what it means (e.g., Sullivan 2008); by offering high product or service quality (though not necessarily the highest on the market); by creating emotional connections with consumers (e.g., Thompson et al. 2006); and by owning a high percentage of mind share (though not necessarily market share). Holt’s primary emphasis is on iconic brands’ ability to create and perpetuate powerful myths that their consumers can experience. Ritually consuming these myths helps consumers navigate the troubled social waters of their times and soothe their anxieties about cultural paradigm shifts (Holt 2003, 2004). Holt claims that this strong symbolic orientation is “the only form of competition that yields icons” (2003: 43, emphasis added). Other models of iconicity confirm that brands that create powerful intangible assets have a better chance of becoming iconic. However, in popular usage, longevity, ubiquity and familiarity are far more important in determining which brands are iconic, hence Coca-Cola’s being on most people’s (minus Holt’s) lists. Niche brands Key attributes: uniqueness, price risk, quality/excellence, sign value, facilitation and/or necessity Niche brands are also known as specialty brands. Overall, niche brands have low market penetration, but high purchase frequency and strong brand loyalty among their customers. Their primary target is a relatively small, specific segment of the population (Kahn et al. 1988). Due to low demand elasticity and low price sensitivity, niche brands need less promotional support than

24 more traditional brand types, an idea confirmed empirically by Sriram et al. (2007) and Pauwels (2007). For the same reasons, Kahn et al. hypothesize, and other researchers (e.g., Sriram et al. 2007, Pauwels 2007, Fader and Schmittlein 1993) show that niche brands can command premium prices. Often, niche brands are small because they represent products that serve a unique need or want that most of the population does not have, such as medical devices or luxury items. Premium pricing also keeps their target markets small. This can lead to niche brands’ becoming excellent signifiers of in-group distinction (Tajfel and Turner 1979). When the brand is mentioned in conversation, or displayed on a logo-bearing item, it can serve to distinguish those who consume these brands from those who don’t, and help users recognize each other. One example of a niche brand is the Yellowstone Club, “the world’s only private ski and golf community,” located in Big Sky, Montana. It is in an out-of-the-way location, with limited numbers of properties, dining rooms, lodges, golf course and ski lifts. The club’s membership is by invitation only, its initiation fee is $250k, and undeveloped lots start at $2 million. The organization has trademarked the term “private powder” to refer to its ski areas, a testament to the value its members, such as Bill Gates and Jack Kemp, put on exclusivity (www.yellowstoneclub.com). On a less rarefied level, Sriram et al. (2007) have shown quantitatively that both Mentadent and Arm and Hammer toothpastes are good examples of niche brands. They have very high brand equity – significantly higher than any other brand in the study – coupled with small market share. These authors speculate, based on their findings, that these brands’ consumers perceive the value and utility they offer to be higher than other toothpastes on the

25 market. This perception allows the parent firms to charge premium prices for products whose tangible attributes are essentially identical to their competitors’. Often when a larger firm acquires a niche brand in order to expand and diversify its holdings (and reduce competition), it will leave the identity of the niche brand completely intact, so as not to disrupt the emotional and identity bonds that consumers have formed. For example, Hershey owns Dagoba organic chocolate, Coors owns Blue Moon beer, Nike owns Converse, and McDonald’s owns the Chipotle restaurant chain. High involvement brands Key attributes: uniqueness, nostalgic/emotional value, price risk, association, quality/excellence, sensory appeal, personification, facilitation High involvement brands reflect how interested the consumer is in a brand specifically, or the product category as a whole. The concept of high involvement brands is firmly grounded in a significant body of research on the consumer-product relationship (e.g., Day 1970, Antil 1984, Zaichkowsky 1985 & 1994, Petty and Cacioppo 1981 & 1983). More recent work by Martin (1998) finds that high-involvement products are those that are highly linked with people, places, other brands, images, etc. Additional qualities that help make products high involvement are their uniqueness and emotional value for consumers. Those products that carry price or social risks, are high quality, and help consumers attain personal goals are more likely to stimulate high consumer involvement (Martin 1998). All these product qualities can easily transfer to brands, and Martin conflates the two entities in his research. Warrington and Shim (2000) compare a product-involvement model of consumer behavior with a brand-commitment model, and find that product involvement and brand loyalty are actually not correlated with each other, e.g., that someone can be highly involved with a

26 product category, yet not brand loyal. Nonetheless, they find that the largest single segment of consumers is comprised of those who are brand loyal and highly involved in decision-making. Specific high involvement brands can be difficult to name, due to the fact that involvement is “generally considered to be a function of three factors: individual characteristics…, situational factors…, and characteristics of the object or stimulus” (Warrington and Shim 2000: 763). Context – such as a consumer’s mental associations or financial position – plays an enormous role in determining whether decision-making is high or low involvement. However, a brand that strongly appeals to the emotions of a single segment will have a higher level of consumer involvement than one aimed at a general audience (cf., Thompson et al. 2006). For example, ProActiv Solution is formulated for people with serious acne; Activia yogurt touts its ability to reduce the effects of irritable bowel syndrome; Brooks running shoes and apparel are aimed at passionate high-mileage runners; bareMinerals is clean, light and natural and claims to be “makeup so pure you can sleep in it” (www.bareminerals.com). The first two brands use celebrity spokespeople who claim to have suffered the ailments the products are supposed to treat, giving the brands the appearance of cachet and validity. Furthermore, both these brands are designed to improve consumers’ health, comfort, appearance, self-esteem and overall well being, which makes them more emotionally salient than, say, Tylenol, which is an all-purpose painkiller. Brooks and bareMinerals do not have the concrete personal associations of celebrity endorsers; instead, they use “real people” in their promotions to create an image of competence, confidence, and simplicity. This persona appeals to consumers who also want to consume pure, authentic products, and who can project themselves into the roles that these brands represent (Sirgy 1982).

27 Dominant brands Key attributes: association, quality/excellence, market share, prototype/normative, familiarity, cultural barometer Dominant brands are those brands that are strongly associated with the product categories they represent in the marketplace. Dominant brands have very high market share and are significantly preferred to other brands by the majority of consumers. They control a large portion of consumer mind share as well, and create a sort of “gravity” around their images that crushes most competitors who do not adequately differentiate themselves from the dominant brand. Therefore, new market entrants will seek significantly differentiated positions, thereby protecting the market space that the dominant brand occupies (Carpenter and Nakamoto 1990). However, it is possible to have more than one dominant brand in a single product category. For example, Coke and Pepsi are both dominant soft-drink firms, and Boeing and Airbus both build commercial aircraft. Each of these brands has a reputation for comparable quality and excellence. Multiple dominant brands can engender fierce loyalty among consumers, with brand evangelists (see Thompson et al. 2006) promoting their preferred brands while vilifying the competition. At the same time, market dominance can create vulnerabilities for these brands. Newer entrants to the market often introduce products that can radically shift consumer behavior in the marketplace, becoming pioneering, dominant brands themselves. Neither Coke nor Pepsi anticipated the energy drink phenomenon when Red Bull debuted in the United States in 1997, even though it was introduced in Austria a decade earlier. This situation allowed the newer firm to grab and hold the dominant share of a rapidly expanding category (Dolan 2005). While the two bigger brands have introduced energy drinks of their own, Red Bull is still the worldwide category leader by a wide margin (www.beveragedaily.com).

28 Pioneering brands Key attributes: uniqueness, nostalgic/emotional value, facilitation, market share, prototype/ normative, familiarity We define pioneering brands as those that introduce a new product category to a wide audience, thereby becoming “the standard against which subsequent entrants are rationally judged” (Schmalensee 1982: 360). This definition acknowledges the considerable number of brands that never make it past infancy in the marketplace (e.g., Golder and Tellis 1993), while retaining the common usage of the term. By their nature, even strong pioneering brands face serious survival risks in the marketplace. Thanks to first-mover advantage, pioneering brands that survive typically enjoy long-term higher market share than their later-entry competitors (Robinson and Min 2002, Kardes et al. 1993). Furthermore, pioneering brands are usually better known than their competitors, and have more favorable and stronger reputations than their competitors (Kardes and Kalyanaram 1992). These substantial advantages are not just reserved to consumer brands; industrial markets demonstrate the same benefits for those brands that create their own product categories (Robinson and Min 2002, Lilien and Yoon 1990). One notable aspect of pioneer brands is that their names can become genericized, wherein the trademarked brand name becomes the general descriptor for the product category (e.g., Kelly and Talley 2004). Some examples include Rollerblade inline skates, Kleenex tissues, Ziploc plastic bags, iPod personal digital music players, Popsicle frozen lollipops, and Xerox photocopiers. All these are still legally protected trade names, but all have become accepted in everyday general use to signify any brand in the category. Pioneering brands that have lost their trademark protection and become completely genericized include yo-yo, nylon, trampoline, raisin bran, zipper, and escalator.

29 Authentic brands Key attributes: uniqueness, association, quality/excellence, stability, internal consistency, longevity Guidry et al. (2008) define an authentic brand as one that “is true to its core image” (3), in that its official communications align with the perception that consumers have of the brand. These authors introduce a structural model in which stability and rarity are antecedents of brand authenticity. The higher-order ideas contain the following attributes: Stability is made up of a brand’s internal consistency, its longitudinal consistency, and its history. Rarity is comprised of uniqueness, scarcity and ties to place (19). An excellent example of an authentic brand is Carhartt, which makes heavy-duty work clothes (www.carhartt.com). This brand was founded in 1889, and is still family-owned. The brand’s commitment to high-quality, durable clothing has resulted in its developing a signature weave of cotton canvas, called Carhartt Master Cloth; most (though not all) of their production is still based in the United States. Being a favorite brand of American farmers and ranchers, Carhartt sponsors such organizations as the Future Farmers of America and the Professional Bull Riders Association. Consistent, stable, and long-lived, Carhartt meets the qualifications to be an authentic brand. A brand that is not authentic is General Electric, because it appears to lack internal consistency. Despite its “ecomagination” marketing campaign, which promotes sustainable, environmentally friendly living through improvements in technology (ge.ecomagination.com), many consumers accuse G.E. of “greenwashing” its image, rather than making substantive changes in its business model and practices (Aitken 2007). Because consumer perceptions do not align with the brand’s desired core image, G.E. cannot be considered authentic.

30 Lifestyle brands Key attributes: association, quality/excellence, sensory appeal, sign value, personification, interactivity, facilitation, internal consistency, mythology, values Lifestyle brands reflect and facilitate people’s ways of living, and enable key aspects of their consumers’ behavior. These consumers range from core users, who themselves help define the brands’ meanings, to those for whom the lifestyle is aspirational. Lifestyle brands offer multifaceted product and promotional mixes that appeal to more than a single aspect of their customers’ interests, feelings and needs. Their product offerings are high quality. They strongly, consistently, and authentically espouse a set of essential values that resonates deeply with some segment of the general population. Finally, lifestyle brands consciously embrace multidirectional relationship marketing (Zinkhan 2002, Lacey and Morgan 2007), as their managers understand that brand meanings derive from the input of both the firm and consumers. A classic example of a lifestyle brand is Airstream campers. These distinctively shiny, riveted aluminum pods have been in production and on American roads continuously since 1935 (www.airstream.com). The brand has a vintage, luxury image, maintained by the firm’s commitment to preserving its original appearance throughout its product line. Airstream campers built in 2008 are not that different in appearance than those built in 1938. Thanks to its longevity, high quality, aesthetic consistency and uniqueness, the brand commands 50% consumer mind share even though it only holds approximately 1% of the total travel-trailer market share (McNair 2003). Named after the firm’s founder, the Wally Byam Caravan Club International holds an annual rally that attracts thousands of campers and Airstream enthusiasts (www.wbcci.org). In addition, smaller clubs regularly host regional rallies and caravan adventures, and there are 25 parks in the U.S. that restrict camping to Airstreams only (www.airstreammotorhomes.com).

31 Many people live in these campers year-round and discuss their experiences with one another online (e.g., airstreamlife.gather.com). The firm publishes a quarterly magazine called Airstream Life and a supplement called Airstream Life Extra. It also sells a variety of parts and accessories for use on- and off-road, as well as clothes, gift items, music, bedding, tableware, Christmas cards and more. The most expensive non-camper item the firm sells is a full-sized office desk made of riveted Airstream aluminum, complete with LED taillights and a spot to mount a license plate. Airstream campers evoke images of adventure and the open road, the optimism of the Space Age, and efficiency, comfort and hominess. Recent events have nudged some Airstream consumers towards ecological thinking. Produsers (i.e., producer + user, Bruns 2005) who emphasize energy independence and sustainability promote the use of solar energy and biofuels in their campers (e.g., http://offgrid-living.blogspot.com/2008/02/mobile-offgrid-living-withairstream.html). Because Airstreams have a clean and futuristic image, these produser modifications do not detract from the overall brand image. Instead they dovetail with the “cando” attitude and innovative persona that the brand has always cultivated. An example of a brand that seems like, but is not, a lifestyle brand is Jägermeister herbal liqueur. Jägermeister has several elements in common with lifestyle brands. It uses heavy p2p marketing to get its message out – selling branded clothing and trinkets, distributing postcards in bars, and maintaining an interactive website. It is even possible for consumers to set up Jägerbranded email accounts. In addition, Jägermeister has a high level of authenticity, using bottles and labels that clearly allude to its introduction in Germany in 1935. Volunteer Jägerettes and Jägerdudes work at bars to promote the drink and to discuss brand history and trivia with patrons (www.jager.com). Popular mythology surrounds the brand. One unsubstantiated rumor says the

32 liqueur was created in honor of Nazi Hermann Göring; another claims it contains deer or elk blood (www.wikipedia.org/wiki/Jagermeister). However, Jägermeister does not qualify as a lifestyle brand, because it does not have a consistent, strong, values-oriented brand personality. Its associations are scattered – the firm sponsors European auto racing, German soccer, an annual American music tour, and the World’s Toughest Rodeo (Blieker 2008). All these activities have in common is that they seem “hard core.” This impression, supported by anecdotal consumer evidence, is the extent of the brand’s personality. Most popular interest in the brand comes from its association with binge drinking, which is not, for most people, an aspirational lifestyle. A Google search of “jager drinking game” pulls up 375k hits. The Urban Dictionary, a rich peer-mediated resource for contemporary slang (www.urbandictionary.com), lists 13 definitions for “jager” and “jagermeister,” all but one of which make reference to debilitating drunkenness (e.g., “I did eight shots of Jager and woke up the next day in a puddle of my own piss”). Lifestyle brands appeal to more than a single aspect of their customers’ interests, feelings and needs. Jager has a unipolar brand message: “Will get you wasted” (www.urbandictionary.com/define.php?term=jager). IMPLICATIONS FOR THEORY AND PRACTICE Although brands can fall into more than one category (e.g., Coca-Cola is pioneering, dominant, and iconic), the elements of the various brand types described above are not optional. Successful firms such McDonald’s and Ralph Lauren’s American Living have stumbled in their attempts to become lifestyle brands because they do not contain all the necessary attributes. In 2005, McDonald’s invited skepticism and derision from critics and industry analysts (e.g., McGruder 2005, Kiley 2005, Bold 2005) by proclaiming itself a lifestyle brand (see Figure 2.1).

33 Changing its employees’ uniforms and engaging pop culture idols in its promotions did nothing to enhance the firm’s sign value, interactivity, facilitation, or values attributes.

Figure 2.1: The Boondocks

Ralph Lauren’s Polo brand is a very successful lifestyle brand, and in February 2008, R.L. launched a new brand called American Living in J.C. Penney stores, as the most expensive clothing line the retailer offers (Maestri 2008). Penney almost immediately cut prices on the items by as much as 40% in order to spur sales. The retailer’s executives said such price cutting is typical for new brand launches, but some analysts are skeptical about this brand-retail partnership, based on the perceived mis-fit between Penney’s middle-class shoppers and Lauren’s trappings of wealth and luxury (MacNealy 2007). One analyst warned that American Living “might not resonate” with Penney’s shoppers (Maestri 2008). These predictions do not indicate that American Living will be a failure – in fact, most analysts expect it to sell well. However, the brand needs to reconcile the considerable disparities in its image and demonstrate the ability to support consumer interactivity and lifestyle facilitation before it can be considered a successful lifestyle brand. Simply calling it a lifestyle brand will not make it so.

34 By identifying critical elements for each type of brand discussed in this chapter, we hope to accomplish three major goals. The first goal is to improve conceptual work on branding by providing a comparative framework of the underpinnings of each brand type. The second goal is to promote managerial confidence and decision-making competence by highlighting the critical elements of each brand type. The third goal is to provide a concise, comprehensive definition of lifestyle branding that we can test and refine, if necessary. CONCLUSION We find that lifestyle branding is distinct from other forms of branding, especially its emphasis on values, its openness to consumer communications, its emotional resonance, and its perceived authenticity by consumers. Not every brand can be a lifestyle brand, even though nonlifestyle brands may possess some of these essential characteristics. In Chapter 3, we analyze p2p marketing techniques with methods similar to those we use in this chapter. Examining popular, professional, and academic literature, we identify and define key characteristics of p2p marketing. We create a classification scheme for p2p techniques and provide theoretical support to explain the proliferation of this form of promotions.

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38 McGruder, Aaron (2005), The Boondocks, July 18. Universal Press Syndicate. Online at http://www.amureprints.com/Detail.asp?ImageID=107622 McNair, James (2003), “The ‘Authentic American Product’ Loved Worldwide,” The Cincinnati Enquirer, December 28. Online at http://www.enquirer.com/editions/2003/12/28/ biz_airstream28.html Muniz, Albert M. and Thomas C. O’Guinn (2001), “Brand Community,” Journal of Consumer Research, vol. 27 (4), 412-432. Pauwels, Koen (2007), “How Retailer and Competitor Decisions Drive the Long-term Effectiveness of Manufacturer Promotions for Fast Moving Consumer Goods,” Journal of Retailing, vol. 83 (3), 297-308. Petty, Richard E. and John T. Cacioppo (1981), Attitudes and Persuasion: Classic and Contemporary Approaches, Dubuque, IA: William C. Brown. _______, John T. Cacioppo and David Schumann (1983), “Central and Peripheral Routes to Advertising Effectiveness: The Moderating Role of Involvement,” Journal of Consumer Research, vol. 10 (2), 135-146. Robinson, William T. and Sungwook Min (2002), “Is the First to Market the First to Fail? Empirical Evidence for Industrial Goods Businesses,” Journal of Marketing Research, vol. 39 (1), 120-128. Rosengren, Sara (2006), “Clutter, Confusion, and Constructive Memory: Five Studies on Marketing Communication Effectiveness,” Thesis proposal, Center for Consumer Marketing, Stockholm School of Economics. Rumbo, Joseph D. (2002), "Consumer Resistance in a World of Advertising Clutter: The Case of Adbusters," Psychology & Marketing, vol. 19 (2), 127-148. Schmalensee, Richard (1982), "Product Differentiation Advantages to Pioneering Brands," American Economic Review, vol. 72 (June), 159-180. Scott, Lesley (2007), “Ralph Lauren, King of Lifestyle,” Suite101.com, Jan 26. Online at http://american-fashion-designers.suite101.com/article.cfm/ralph_lauren_ king_of_lifestyle Sirgy, M. Joseph (1982), “Self-concept in consumer-behavior: A critical review,” Journal of Consumer Research, vol. 9 (3), 287-300. Solomon, Michael R. (1983), “The Role of Products as Social Stimuli: A Symbolic Interactionism Perspective,” Journal of Consumer Research, vol. 10 (4), 319-329.

39 Sriram, S,. Subramanian Balachander and Manohar U. Kalwani (2007), “Monitoring the Dynamics of Brand Equity Using Store-Level Data,” Journal of Marketing, vol. 71 (2), 61-78. Sullivan, Elisabeth A. (2008), “Best in Class: Butterfield Market,” American Marketing Association, May 1. Online at http://www.marketingpower.com/ResourceLibrary/ MarketingNews/Pages/2008/42/8/ButterfieldMarket.aspx Tajfel, Henri and John C. Turner (1979), “An Integrative Theory of Intergroup Conflict” in The Social Psychology of Intergroup Relations, William G. Austin and Stephen Worchel (eds.), Monterey, CA: Brooks/Cole. Thompson, Craig J., Aric Rindfleisch and Zeynep Arsel (2006), “Emotional Branding and the Strategic Value of the Doppelgänger Brand Image,” Journal of Marketing, vol. 70 (1), 50-64. Warrington, Patti and Soyeon Shim (2000), “An Empirical Investigation of the Relationship between Product Involvement and Brand Commitment,” Psychology and Marketing, vol. 17 (9), 761-782. Zaichkowsky, Judith Lynne (1985), “Measuring the Involvement Construct,” Journal of Consumer Research, vol. 12 (3), 341-352. ________ (1994), “The Personal Involvement Inventory: Reduction, Revision, and Application to Advertising,” Journal of Advertising, vol. 23 (4), 59-70. Zinkhan, George M. (2002), “Relationship Marketing: Theory and Implementation,” Journal of Market-Focused Management, vol. 5, 83-89. airstreamlife.gather.com ge.ecomagination.com offgrid-living.blogspot.com www.airstream.com www.airstreammotorhomes.com www.bareminerals.com www.beveragedaily.com www.carhartt.com www.jager.com www.urbandictionary.com www.wbcci.org www.wikipedia.org www.yellowstoneclub.com

40

CHAPTER 3 PEER-TO-PEER MEDIA OPPORTUNITIES2

2

Austin, C.G., G.M. Zinkhan, and J.H. Song. 2007. The SAGE Handbook of Advertising. 349-365. Reprinted here with permission of publisher.

41 INTRODUCTION Various defining characteristics of late 20th and early 21st century life (e.g., limited “free time,” dedifferentiation, fragmentation, the ubiquity of marketing messages) have resulted in consumers’ ignoring or resisting much of the advertising that is targeted to them. Marketing managers recognize this fact, but some of their counter strategies (e.g., turning up the volume, using larger, more shocking or flamboyant ads) sometimes serve to bolster consumers’ defenses against such “noise” (Rumbo 2002; Kozinets 2002; Holt 2002; Austin et al. 2005; Godin 1999). In the midst of this cacophony, old-fashioned word-of-mouth – consumer information passed directly from one person to another – is one communication device that still has impact in a complicated and fragmented marketplace. Consumers highly value the purchasing advice they receive from a mentor, trusted expert, colleague, friend, family member, or neighbor (Dye 2000; Phelps et al. 2004; Carl 2006). The popular press is filled with titles on interpersonal, i.e., peer-to-peer influences on marketing and consumer choices (e.g., Gladwell 2000; Rosen 2000). Not surprisingly, marketing managers look for ways to use these conduits to advance their own messages. When managers successfully recruit consumers to further advance their marketing activities, we label this practice as consumer-based promotion. Informal communication among consumers is the crux of consumer-based promotional methods. In this paper, we use the terms “consumer-based promotions” and “peer-to-peer promotions” interchangeably. However, it is important to note the distinction between peer-to-peer communication and peer-to-peer promotion: While not all peer-to-peer communication is a form of consumer-based (or peer-to-peer) promotion, all consumer-based promotions are a form of peer-to-peer communication.

42 In consumer-based promotional techniques, the distinction softens between buyers and sellers. Although many contemporary marketing managers are excited about the creative and promotional horizons that new technologies (e.g., the Internet) have opened for consumer-brand interactions, most of these methods have been around in some form, for a century or more. In a peer-to-peer promotional environment, a woman sends a “wish you were here” postcard to her sister; an amateur athlete’s sports- and leisurewear are splashed with logos; a child proudly shows off a temporary tattoo of his favorite cartoon character to his classmates; a blogger extols the virtues of her new favorite toothpaste. Some consumers may not even be aware that they are participating in marketing campaigns or acting as corporate spokespersons at the street level. However, through buying and using certain products, they become the marketer’s promotional ally. Consumers’ assumption of this role is volitional, as marketers lack the power to coerce consumption of their branded products and services. A major theme in this chapter is to explore ways in which marketers have taken a postmodern perspective on this blending of promotions, mass communication, and word-ofmouth communication, and attempted to revamp old marketing forms that use this power, as well as initiate new ones. Along these lines, our main objectives are three-fold: 1) to introduce a schematic representation of peer-to-peer promotional techniques, 2) to introduce a group of variables (e.g., risk, visibility, ease of use) that serve to differentiate both ancient and emerging promotional methods, and 3) to identify potential problems and opportunities associated with these promotional tools and offer promising directions for future research. We first provide a conceptual framework for how consumer-based promotion fits in with a developing understanding of the postmodern new-tech marketplace (see, e.g., Arnould and Thompson 2005; Arias and Acebron 2001; Watson et al. 2000; Firat and Venkatesh 1995). We

43 also discuss consumers’ use of brands as a form of interpersonal communication. Next, we present a classification of consumer-based promotional methods and provide definitions and rationales for its use. This scheme is designed to illuminate similarities and differences, trends and themes in consumer-based promotion for both researchers and managers. After suggestions for future research, we conclude with a summary. It is important to note that this chapter offers neither a comprehensive history of promotional creativity, nor predictions about what new marketing techniques will be invented in the future. Rather, our aim is to sort out and illuminate the ways that marketers’ and consumers’ use of word-of-mouth promotions is evolving with the introduction of new technologies and media. CONCEPTUAL BACKGROUND Two conceptual backgrounds are employed to identify and examine different consumerbased promotional methods: 1) Postmodernism and 2) Self-brand connection. Each approach is discussed in following section. Postmodernism and marketing The modernist places the human being at the center, as the subject of the action. Modernity promotes order and the establishment of proper ways, means, places, times, and reasons for doing things. The modern view of marketing has always promoted consumption: value is created in production and destroyed in consumption, so consumption is regarded as secondary to production in a modernist business and marketing paradigm (Trist 1973; Ramirez 1999).

44 In contrast, the characteristics of a postmodern society are reflected in current marketing practices, as well as in the challenges organizations face in an increasingly complex, global marketplace. We explore three important themes related to consumer-based promotion: 1) dedifferentiation, 2) fragmentation, and 3) hyperreality. 1) Dedifferentiation One postmodern theme that conspicuously influences contemporary marketing strategy is dedifferentiation, where the identities of individuals and institutions become blurred, shared and mixed (Arias and Acebron 2001), as when an independent consumer creates an advertisement such as George Masters’ online commercial for the iPod mini (Kahney 2004). Thomas (1997) provides such examples of dedifferentiation as advertorials (advertising editorials), infomercials (information-heavy commercials), and shopping centers that also act as theme parks, such as ESPN Zone (see e.g. Kozinets et al. 2002). Other marketing practices provide additional examples of the blurring of traditional categorizations and illustrate another characteristic of postmodern society, that of paradoxical juxtapositions, where apparent opposites become simultaneously possible (Arias and Acebron 2001). For example, Converse Chuck Taylor AllStar tennis shoes carry an independent, iconoclastic brand meaning for their wearers, despite being iconic themselves (en.wikipedia.org). Furthermore, they are often viewed as being an anti-Nike sportswear choice, even though Nike bought Converse in 2003 (Watson 2003). In a postmodern age, consumption has become a process where individuals define themselves and their images in contemporary society (Bourdieu 1984). As a result, marketing managers have designed means through which this consumption and identity-creation process can be simultaneously harnessed to accomplish organizational objectives. Thomas (1997) specifically notes that postmodern marketing openly challenges the axiom of buyer-seller

45 separation. Consumer-based promotion focuses on this lack of separation. In this chapter, we describe several promotional practices in which the consumer assumes the role of a marketer. Some examples include: temporary and permanent tattoos; temporary and permanent graffiti; consumer-generated and -mediated web pages, blogs, and email; and paper and electronic postcards. Marketing managers have a long history of attempting to generate positive word-ofmouth about branded products, but consumers today have become far more integral to the marketing process. Under this model, the consumer is both consumer and marketer. Not only are consumers disseminating marketing communications, but they are also developing new products, new media, new content and new marketing materials on their own, using pre-existing technologies, techniques, and materials to connect with each other and the firm. These recombinations of media and content are called “mashups.” One early example comes from amateur and professional DJs, who digitally remixed music by two or more artists into a new song, and subsequently released it online for free. Other forms of web-based, interactive social media have arisen in fields such as “psychogeography” (e.g., www.platial.com), real estate (e.g., www.zillow.com), and advertising (e.g., www.thespecspot.com). New media mavens, such as Google’s Vint Cerf, embrace these consumer-based forms of marketing. “There are creative people all around the world, hundreds of millions of them, and they are going to think of things to do with our basic platform that we didn't think of. So the mashup stuff is a wonderful way of allowing people to find new ways of applying the basic infrastructures we're propagating” (Perez 2005). It is important to note that the assignment of symbolic meanings in material culture may occur with little or no input from marketing managers. In the modernist industrial value-creation system, customers are seen as “destroying the value which producers had created for them”

46 (Ramirez 1999). Under the postmodern view, customers do not destroy value; they create it. Value is not simply 'added,' but is mutually 'created' and ‘re-created' among actors with different values. Nonetheless, a distinct boundary often remains between the firm and the consumers / users (e.g., Bosman 2006). In many cases, consumers still may display disinterest, suspicion, or antipathy towards marketing managers and their branding efforts. From an investment perspective, many venture capitalists see mashed-up businesses such as Zillow as interesting and socially useful, but unworthy of their support, mainly due to how open and available their source materials are. In other words, mashed-up websites may be fun, but are so easy to copy that they occupy no long-term defensible position in the consumer’s or the investor’s, mind (Hafner 2006). 2) Fragmentation In the 21st century, mass communication (e.g., advertising, broadcasting) is still largely effective as a means of reaching audiences of considerable size. Nonetheless, technological advances have led to increasingly fragmented audiences across nearly infinite channels of communication and influence, as new media have always provided finer segmentation alternatives to older media. Compare TiVo to TV to cinema; Podcasts (or Skypecasts) to radio broadcasts; blogs to newspapers; email to telephones to face-to-face conversations. With respect to media, individual consumers in the 21st century choose what they want to consume, and when, where and how they want to consume it. Beginning in the early 20th century, technology has promoted an increasing fragmentation of media outlets, mass culture, and individual consumer behavior. Peer-to-peer promotions try to fill in the gaps, to target the niches that are resistant to traditional means of advertising, as well as to reach those audiences that commercial “noise” has

47 desensitized to traditional marketing techniques (Muniz and O’Guinn 2001; Firat and Venkatesh 1993; Irvine 1998; Close and Zinkhan 2005). Fragmentation dictates distinct strategies for each targeted segment, and in extreme cases, a strategy can be tailored to an individual consumer. Moreover, postmodernism abandons the notion of a single, unified, consistent self-image or lifestyle and even encourages the fragmentation of the self, increasing the potential for choice, not only among brands but also among a myriad of assumed identities and projected images (Firat and Venkatesh 1993). It is now quite common for scholars to write about the notion of “constructed self” – the idea that each person possesses a unique combination of innate and adopted attributes and characteristics that changes over time (Elliot and Wattanasuwan 1998; Dittmar 1992; Gabriel and Lang 1995; Giddens 1991; Thompson 1995). 3) Hyperreality Under modernist accounts, people have control over their lives, and humans are seen as the masters of their domains (i.e., masters of nature). Postmodern individuals find themselves objects as often as subjects in their interactions with their culture. For this reason, objects in a postmodern society, including people, are commodified. Therefore, no aspect of life, including anti-corporate rebellion, is exempt from being used as a marketing message (Firat and Venkatesh 1993). Anti-branding advocates such as Naomi Klein, Michael Moore, and Adbusters magazine are brands unto themselves (e.g., Walker 2006). As a result of this merging of consumerism and culture, there is a new phenomenon, “metamarketing,” in which marketing is seamlessly incorporated into mass media, and media into marketing, so that the whole activity of marketing becomes an end unto itself (Firat and Venkatesh 1993). Consumer-based promotion plays into the idea of metamarketing by

48 integrating purchasing behaviors, cultural norms, personal styles, and day-to-day communications. Culture is consumed; consumption is culture (Firat and Venkatesh 1993). This mingling of commerce and culture can present obstacles for marketers; the “clutter” it creates in people’s minds makes it increasingly difficult for any single marketing message to stand out (Godin 1999). However, the union also offers solutions in the form of peer-to-peer promotions. Americans, especially young people, are used to being sold to, and to having their lives constantly market-tested. “[Kids] are extremely aware of how valuable they are,” says Jeff Kaufman, vice president of research and planning at MTV. “You can’t pull the wool over their eyes…. In fact, sometimes, when we’re testing a show, we’ll say, ‘What do you think?’ And they’ll say, ‘Well, I can see what MTV is trying to do here. If they air it in the right time slot, after the right lead-in, they’ll probably get the target demographic they’re going after’” (Dunn, 2001, 106). Postmodern consumers are educated, savvy, and skeptical. Brand managers who understand such consumers see an opportunity to employ consumer-based marketing techniques, and have consequently revived interest in word-of-mouth promotions. The Self-Brand Connection Consumer-based marketing relies on consumer investment in a product, a brand, a parent company, or an ideal related to one or more of these three. (We will use the word “brand” to stand for any of these terms, unless otherwise noted.) The strength of the investment depends on the consumer’s attitudes and is linked to the symbolic meaning of the brand. Sirgy (1982) provides an excellent overview of the research literature on the subject, of how self-image and brand image are intertwined, the main points being: -

Brands leverage symbolic as well as concrete value for consumers; and Consumption behavior is generally predicated on the synergy between consumer selfconcept (either actual or ideal) and symbolic value of a brand.

49

Without the investment of one’s self into a brand’s symbolic value, a consumer is far less likely to purchase, or even consider purchasing, that brand. Conversely, loyal users have been shown to identify very strongly with certain products, firms and brands (see Belk 1988; Fournier 1998; Muniz and O’Guinn 2001). In consumer-based marketing, no actual purchase is required (in most cases) for the transmission of the marketing message to occur. Consumer use of the marketing materials, however, is imperative. The content of the peer-to-peer message, its mechanism of distribution, and the person initiating its transmission are in most cases enough to imbue the brand with cocreated symbolic meaning – a kind of street-level cachet. As long as this cachet is passed along from consumer-communicators to others who do purchase the brand, street-level marketing is successful. This follows the classic two-step flow model of communication effects first postulated by Lazarsfeld, Berelson and Gaudet (1944), in which media-savvy early adopters pass on their knowledge of what is “new and improved” to the later-adopting public at large. This ripple or “viral” effect is at the heart of peer-to-peer marketing techniques. In the initial stages of consumer-based new product launches, samples and giveaways to influential and visible consumers are commonplace. These senders of the message (early adopters) must feel some level of self-brand connection, but this connection does not necessarily arise from, or result in, their making a purchase. For example BzzAgent (www.bzzagent.com), a word-of-mouth marketing agency, not only sends its volunteer “worker bees” samples of the products they have been hired to create buzz about, but also has a reward system in place for those agents who buzz the best. Peer-to-peer communication becomes a means to an end in quite a different way for BzzAgents than for consumers who simply discuss products as part of their everyday interactions with their friends, family and colleagues (Carl 2006). Thus, the level of

50 commitment required by the first person transmitting a message is, in many cases, lower than it would be for a person who chooses to purchase and use the relevant brand. The risk for early communicators is also relatively low, so managers are quite willing to experiment with consumer-based innovations. In many cases, it is relatively easy to observe the immediate impact on performance (e.g., in terms of sales). From an organizational perspective, there is a possibility that managers lose some control of their brands’ images. Since consumers decide how to use the message, they have the option to put their own “twist” on the brand if they choose (Aubert-Gamet and Cove 1997). In early 2006, Chevrolet invited patrons of its website to create and post 30-second spots for its 2007 model Tahoe SUV because it didn’t want to miss the “gold rush fever” of excitement surrounding consumer-generated advertising and viral blogging (Huba 2006). The most talked-about (i.e., buzz-inducing) ads were those that were sharply critical of the Tahoe’s poor fuel economy. These ads were ironic because they used glossy, gorgeous images of the Tahoe in the wild (provided gratis by Chevrolet), overlaid with stark text about the environmental irresponsibility of driving an SUV (Bosman 2006). Clearly, the ultimate impact of the consumer-based promotional message depends on the direction and strength of the customer’s connection to the brand. CONSUMER-BASED PROMOTIONAL METHODS Our classification of consumer-based promotions is shown in Table 3.1. In the left column, we identify the major methods of consumer-based promotion. Note that some methods (e.g., tattoos) have a number of alternative forms (e.g., temporary, semi-permanent, permanent). In the remaining seven columns, we identify key elements or features that distinguish the communication methods one another. For the purpose of illustration, we use the labels

51 “Consumer 1” (to refer to the sender of a message) and “Consumer 2” (to refer to the message receiver). Our focus here is to understand consumer-mediated marketing techniques from the perspective of Consumer 1. How well Consumer 2 receives, understands, or acts upon the message is not under consideration for this particular analysis. Each method is discussed in next section, followed by a section to discuss key features that distinguish the methods.

Table 3.1: Elements of consumer-based promotional methods Medium

Consumer Commitment

Consumer Risk

Visibility

Ease of Use

Initiation

Who Pays?

Recruitment Method

Word-of-Mouth Postcards Paper Electronic Tattoos Temporary Semi-Permanent Permanent Graffiti Temporary Permanent Auto Wraps

Low Medium

Very Low

Low

Very High

Hybrid Brand

NA Brand

Conversion

Low Medium

Very Low Low High

Medium High

Stickers Giveaway Purchase Bumper Stickers Clothing Brand-name “Message” Branded gift- or purchase-with-purchase Concurrent Acquisition Subsequent Acquisition Logo-bearing Products Internet Email Chat Rooms User-Rating Systems Product-Related Sites Official Consumer-run Online Graffiti Weblogs (“Blogs”) Podcasts/Skypecasts Consumer-generated media Online Offline

Medium High Very High High

Low Low Very High

Passive Conversion Consumer

High Medium Low

Brand Hybrid Consumer Hybrid Hybrid Brand

Very High

(Brand)* Brand

Very High

Medium High High

Very High

Medium Low Very Low

Low Medium High

Low Low Medium

High High Very High

Very High Very High High

High High

Very Low Low

Medium High Low

Very High Very High

Brand

Brand

Low Medium Variable

Low Medium Very Low

High High Very High

Low Medium Medium

Low (Very) High Medium High High

Low Med./High High Medium Medium

High

High

Medium Low High Very High (Very)Hig h

Variable Variable High

Brand Consumer Consumer Consumer

Passive/Con v Passive (Active)

Brand Hybrid Brand

Consumer

Conversion Active Active

High Low Very High

Brand

Consumer

Active/Conv

Hybrid Either Either Hybrid

NA

High High Medium

NA (Active)

Very High Low High Medium Low

Brand Consumer Consumer Consumer Either

Low

Brand

(Passive) (Active) (Passive) (Conversion) (Conversion) Brand

(Medium) (Medium)

Conversion Active/Conv Conversion

Active (Conversion)

(Either)

52 A note on Table 3.1: Parentheses designate notable exceptions to categorical generalizations, e.g., brands recruiting professional athletes to wear semi-permanent advertising tattoos, with tattooing being a category that is, on the whole, consumer-mediated. Word-of-Mouth Word-of-mouth communication is defined as the transfer of information from one consumer to another. Word-of-mouth is especially influential in industries such as toys, motion pictures, fashion, and recreation services (Dye 2000). As we noted earlier, there is increasing interest in trying to stimulate positive word of mouth, and more methods are now available for monitoring what users are saying or writing about brands. For instance, managers can read blogs or critical reviews online. Postcards Along with graffiti and branding, paper postcards are an extremely durable method. They have been in use for generations and still thrive today. Introduced worldwide during the 1860s and ’70s as a paper-conserving means of communication, postcards were quickly recognized to have mass marketing potential for alerting people to a sale or to an escaped convict, or promoting the attractiveness of a town (Doster, 1991). Today, advertisers use them as a means of building general brand awareness and image, and to promote specific events. Generally, advertising postcards are seeded in restaurants and bars, and their design indicates that most people picking them up will be drawn by the graphic image on the front, not bothering to read the fine print on the reverse until they get home (or somewhere else with better light and fewer distractions). Most are meant to be used in the traditional sense, being mailed from Consumer 1 to Consumer 2, although a few attempt to build brand loyalty by capturing consumer information from mail-in offer.

53 Tattoos Tattoos are used by advertisers both in ads and as ads, to promote products as diverse as motorcycles, beer, Pokemon and the Girl Scouts. Casa Sanchez, a San Francisco restaurant offers a free lunch for life to anyone who gets a permanent tattoo showing the restaurant’s “Corn Man” logo (Wells 1999). In March, 2001, Fifty Rubies, a New York-based marketing firm, attempted to sell NBA players as billboards, leasing their bare skin for temporarily-tattooed corporate logos. The NBA nixed the idea, citing its own policy of not allowing any corporate advertising on its uniforms (Robinson 2001). The Black Star Brewery ran a promotion promising to give away a Harley-Davidson motorcycle to the person who presented the largest tattoo of the Black Star logo. The brewery discontinued the promotion after receiving a significant amount of criticism (Wells 1999). Indeed, tattooing draws considerable criticism, whether it is virtual (in the case of the Girl Scouts’ ads), temporary or permanent. The body, in critics’ opinions, is sanctified, private space, and they sometimes refer to commercialized tattooing as “shocking,” “outrageous” and “sinister,” “defacing” the body (Wells 1999; Robinson 2001; Rubin 2001; Wutz 2000). Because permanent tattoos require such a high level of commitment from their bearers, they can be a litmus test for consumer-based promotions in terms of brand loyalty. For example, there are two major classes of Harley-Davidson aficionados: riders and bikers. Riders probably do not sport logo tattoos, while bikers invariably do (Hill and Rifkin 1999). Harley-Davidson has leveraged this difference by expanding its product line, offering everything from apparel to playing cards to cigarettes, so that anyone interested in the brand may display the logo in some form. Nonetheless, the tattoo still stands as a symbol of the highest level of commitment to the brand, and the lifestyle.

54 Graffiti With graffiti and other consumer-based initiatives, established companies are using “cool” cultural artifacts to build their own brand identities, hoping to tap into a jaded and overstimulated consumer market. For instance, IBM implemented a multi-million-dollar campaign for its Linux operating system in April, 2001 that included several street-level components, including spray-painting the iconic message “Peace, Love and Linux” (a peace symbol, a heart, and the Linux penguin) on sidewalks in Chicago and San Francisco. Unfortunately, Ogilvy & Mather’s original idea – to use biodegradable chalk for the stencils in lieu of spraypaint – was not properly conveyed to the street teams who executed the stenciling, and IBM was fined by both cities for defacing public property (Niccolai 2001). People have used graffiti as a medium for public discourse since antiquity. Until recently, these messages have been transmitted virally at the grass-roots level, rather than from the top down (Gonnerman 1999). The local “writers” of such viral graffiti are generally anonymous, and the messages conveyed are meant to be public service announcements of a sort. IBM and other large corporations that have adopted graffiti as an advertising medium, such as Reebok, are trying to bypass consumers’ advertising radar by using the same kind of subversive methods that activists have employed in the past (Kenigsberg 2001). Graffiti, whether chalked or painted, generates controversy as a consumer-based marketing tool. Michael Jacobson of the Center for Science in the Public Interest says of graffiti and tattoos in particular, and of consumer-based methods in general, “Many of these things will come and go, but the sum total is the added invasion of previously ad-free space. It’s an annoyance to the public and completely inappropriate” (Wells 1999).

55 Auto Wrapping Auto wrapping is the only consumer-based method included in the table where consumers are paid cash for their services as street-level marketers. Drivers of wrapped cars have the option of either driving a new car for free (excluding gas and insurance charges), or of receiving a monthly check, with the amount depending upon the extent of wrapping. Wrapping, which may be the most visible form of non-electronic consumer-based promotion, is the least easy to use from Consumer 1’s standpoint. Wrapping an entire car takes approximately eight hours, and the driver must submit to a semi-weekly or monthly car inspection in order to receive payment. This check-up includes an odometer reading, a global positioning system (GPS) check, and a cleanliness review. In a standard agreement, drivers must log at least 1000 miles a month, and must keep the GPS unit turned on at all times. In most cases, drivers are selected from a pool of applicants based on the fit between their driving habits and the communications needs of the sponsors. Therefore, car owners have little or no say about which ads they would like to place on their vehicles, indicating that commitment to the brand is far less important to them than financial reward they receive for participation. However, most auto wrappers are now offering their services to nonprofit organizations as public service announcements, which drivers may request. Branding Methods: Stickers, Clothing, Branded Gifts, Purchase-with-Purchase, and Logo-Bearing Products The bottom half of Table 3.1 includes assorted branding methods. When a teenage boy puts a band’s logo sticker on his skateboard, this practice is not fundamentally different from a debutante’s wearing a designer suit to a lunch date. One result of branding is that consumers identify with their peer group.

56 “Many products, for example house furnishings and clothes, are highly visible and regarded as indicative of the owner’s values. Such visible purchases are intended to communicate a favorable image. They cater to such life goals as wanting to be admired, beautiful, socially accepted, and so on” (O’Shaughnessy 1987, 10-11, see also Lascu and Zinkhan 1999). The Internet In the 21st century marketplace, a consumer can widely disseminate word-of-mouth information, both positive and negative, via various Internet outlets (e.g., email, blogs, chat rooms, spoof sites) as well as through more traditional means (Pitt et al. 2002). According to Forrester Research, the average household receives nine email marketing messages each day and tends to ignore such messages. In contrast, Internet users pay more attention to email messages that emanate from their family members, friends, or relatives (Phelps et al. 2004). Some e-commerce firms, such as Epinions.com, include Web features to highlight customers’ word-of-mouth communications. For example, customers can rate products and services and, at the same time, review products. In this way, word-of-mouth communication can be a cost-effective way to transform customers into a marketing force. The Internet offers the greatest opportunity for a firm to leverage networking and consumer-based initiatives. Almost all of the more traditional consumer-based promotional campaigns also have an online component (e.g., IBM’s Linux campaign). Many consumer-based promotional initiatives exist solely in cyberspace and may belong entirely to consumers without any input, authorization, or oversight from a brand’s official managers. This creates interesting, and potentially outrageous, possibilities for consumers taking marketing into their own hands. Nader Traders was an email-based grass-roots campaign designed to garner 5% of the national vote for Green Party candidate (and one-man brand) Ralph Nader in the 2000 Presidential election (Harris 2000). Although it was not ultimately successful, it generated

57 considerable publicity. Vote swapping was considered so dangerous to the democratic process that several swap-facilitation sites were shut down by government order. Subsequently, California and New York orders were upheld in Federal court (Zaret, 2000). Information regarding Nader Traders traveled through the voting population via email, without any overarching or centralized architecture provided by Nader or the Green Party. Viral marketing may be the next “killer application” of the Internet. Certainly media financiers are banking on its networking capacity to generate revenues in virtual marketspaces that have not yet seen any profits, as evidenced by Rupert Murdoch’s acquisition of MySpace and Accel Partners’ investment in Facebook, deals worth hundreds of millions, and potentially billions, of dollars each (Cassidy 2006). As for the humble email, the “forward” and “reply all” buttons and the electronic address book are invaluable tools for viral email messaging. Carlton Draught’s very funny “Big Ad” (www.bigad.com.au) received one million page hits within two weeks of being launched online, thanks to friends telling friends about it (Lees 2005). Across all these consumer-controlled electronic media, the quality and content of the messages determine how widely information is transmitted. It is interesting to note the evolution of tracking technologies for digital marketplaces, and of consumer-based promotional initiatives in particular. In November, 2000, David Holtzman launched Opion.com, a buzz-tracking website that evaluated online chatter in chat rooms, bulletin boards, newsgroups and websites, looking for trends that would affect various markets. Opion attempted to predict, among other things, box office receipts, election results, and Wall Street swoops and wobbles (Wakefield 2001). Subsequent shifts in the marketplace, most notably the explosion of consumer-based initiatives, have caused the field of online analysis and trend prediction to expand enormously; as of February 2006, Opion no longer

58 existed, having been rolled, in a series of acquisitions, into a new venture called Nielsen BuzzMetrics. BuzzMetrics’s client list includes Nokia, Target, Proctor & Gamble, Sony, pharmaceutical firms, HBO, and Microsoft, and they promise to “help companies gain market feedback and understand how consumers talk about important issues, advocate products and spread information.… by combining superb brand and consumer expertise, proprietary datamining technology, and Nielsen’s unrivaled experience in media measurement and client service” (www.nielsenbuzzmetrics.com). Another web-based initiative that has contributed enormously to the electronic consumerbased marketing revolution is the advent of weblogs (aka, “blogs”), which started as little more than electronic journals or diaries and have evolved into serious means of niche/mass communication. They are primarily personal accounts focused on a particular theme (e.g., the blogger’s take on politics, favorite sports, or day-to-day activities) and provide primary and secondary information along with the blogger’s commentary related to these items. Furthermore, blogs are usually designed to encourage readers to provide their own commentary on either the subject matter or the blogger’s (or other readers’) reactions to the subject matter. Often, bloggers will dissect – while naming names – their employers, favorite new products, brands they love and hate, and bad service encounters. Because blogging is such a new medium, there are relatively few rules governing its use, and most use is considered protected under the First Amendment. Firms are trying to protect themselves and their brands from blog abuse through various means. For example, in 2004 Delta Airlines fired Ellen Simonetti (aka, Queen of Sky) after she posted “inappropriate” photos of herself in uniform on her blog (queenofsky.journalspace.com). In the photos, Simonetti is fully clothed in her Delta flight attendant’s uniform, onboard an

59 otherwise empty airplane, posing in ways that emphasize her body as she performs work-related tasks (e.g., serving drinks, putting luggage in an overhead bin). The photos are more silly than sexy, but Delta found them offensive and out of keeping with its corporate image and policies. Simonetti has fought back by maintaining her blog (which includes the photos in question and an audio file of the phone conversation in which her supervisor fired her), hiring a press agent, and writing a roman à clef. Jonah Peretti became an Information Age celebrity of sorts in 2001 when he published an email exchange he had had with Nike over the term “sweatshop” on his blog (www.shey.net/niked.html). The satirical David-and-Goliath story rocketed through cyberspace and was shortly picked by media outlets worldwide, including such ideologically diverse media outlets as The Wall Street Journal, The Nation, USA Today, and The Village Voice. Nike’s response to the blogging itself was minimal (as was Delta’s in the Simonetti case), but Peretti has achieved a modicum of lasting fame among those he terms “the Bored at Work Network (BWN)” by posting content at www.contagiousmedia.org and www.eyebeam.com. He writes, “This low-budget, bottom-up approach makes it possible to create a global cascade that begins with a small group of friends and extends to the set of CNN or the Today Show. These Contagious Media Experiments suggest new opportunities for artists and activists in the networked age” (www.contagiousmedia.org). Though Peretti may not like it, the notion of contagious media is also at the heart of all consumer-based promotions, especially in its evolving electronic forms. With Podcasting and Skypecasting, consumers remain in control of the audio files that they receive, and the sender may be either the firm or another consumer. The target audiences for Pod- and Skypecasts are self-selected and usually very engaged with either the sender or the

60 subject matter. A small sample of available Podcasts includes music (the first use of the medium), interviews with video game designers, wine and beer reviews, travel and tourism guides, and NASCAR updates (see, e.g., www.podcastalley.com). Consumer-Generated Media Firms were using their customers’ creative energies as a way to generate official marketing materials long before the advent of the Internet. The Prize Winner of Defiance, Ohio: How My Mother Raised 10 Kids on 25 Words or Less (Ryan 2001) details the story of a Midwestern housewife whose amateur ad jingle-writing skills kept her family afloat during the 1950s and ’60s. The Pillsbury Bake-Off® Contest debuted in New York City in 1949 and has been inspiring amateur chefs to take a shot at the grand prize, in 2006 worth $1 million and a kitchen full of stainless steel appliances (www.pillsbury.com). Jones Soda began distributing its “alternative beverages” in 1996, using consumer-submitted photographs for all its marketing and packaging materials, including bottle labels. They also encourage users to send in quotes and flavor suggestions (www.jonessoda.com). While those whose input is chosen don’t win money or prizes, the number of photos submitted to the website indicates that the glory of winning a bottle label is almost as compelling as a million dollars. Other firms that have adopted similar consumer-generated campaigns include Converse, MasterCard, Chevrolet, L’Oreal and Sony. The Internet has fostered an explosion of consumer-generated promotions, thanks to the ease with which users can create and distribute material. Online, consumers’ creating and posting brand- and product-related creative output is pervasive. In 2003, 44% of wired Americans reported having created and/or posted content online (Lenhart et al. 2004). Often, consumers create their own amateur online advertisements simply because they love or hate a particular product. If they get picked up and disseminated through blogs and email, these ads

61 can achieve a massive amount of exposure (Kahney 2004). For an interesting contrast between iPod users, see George Masters’s digital love letter to his “Tiny Machine” (available at www.imediaconnection.com), versus the Neistat Brothers’ expose of the “iPod’s Dirty Secret” (i.e., its short-lived, non-replaceable battery, available at www.ipodsdirtysecret.com). KEY FEATURES DISTINGUISHING DIFFERENT CONSUMER-BASED PROMOTIONAL TECHNIQUES Seven attributes distinguish consumer-based promotions. Each method is ranked along these dimensions in Table 3.1. Consumer commitment The level of interest in either the brand or the promotional medium that is required for Consumer 1 to participate in a consumer-based campaign. For instance, driving a car bearing a commercial auto wrap requires a very high level of commitment from the owner/driver, while forwarding an email recommendation (e.g., a movie review) to a friend requires significantly less commitment. Some consumer-based promotional techniques are so creatively compelling, such as designing an advertisement (e.g., Converse), or so entertaining (e.g., The “Big Ad”), or offer great potential for reward, such as having one’s artwork selected in a contest to be used as a product label (e.g., Jones Soda), that consumers will participate in a peer-to-peer promotional campaign even though their commitment to the brand itself is negligible. Consumer risk Risk includes a variety of dimensions, including legal, physical, emotional, and economic risk (or a loss of privacy) (Conchar et al. 2004). Opportunity costs also fall into this category. Consumer 1 assumes a certain amount of risk by participating in consumer-based promotions. The permanent tattooing of a brand logo entails considerable risk; sending a paper postcard entails relatively little. Sending an electronic postcard opens the sender to receiving unwanted

62 email from the host website, and is, therefore, somewhat riskier. Risk is where the majority of public-policy concerns regarding consumer-based promotions come into play. Visibility Visibility describes the number of potential recipients of the marketing message. In other words, how many Consumer 2s will each Consumer 1 be able to reach? Auto-wrapping companies require monthly odometer checks to ensure maximum visibility of their marketing messages. A sticker on a student’s backpack will be seen by significantly fewer people. Ease of Use Ease refers to the amount of effort required for Consumer 1 to transmit the marketing message to Consumer 2. A bumper sticker is easy to use, a postcard is a little harder, maintaining a weblog is harder still, and designing a website requires yet more time and effort. However, electronic media such as blog hosting websites are becoming increasingly userfriendly. Initiation The party that initiates a consumer-based promotional campaign may be the brand’s corporate parent, the consumer, or a hybrid of the two. Hybridized forms generally start as consumer-initiated, but then marketing managers seek to influence or adopt the method. For example, the idea of promotional graffiti sprang from graffiti used for artistic or political expression. In other cases, brand-initiated peer-to-peer promotions might coexist with independent consumer-initiated forms in the same medium, such as official websites, fansites, and anti-fansites all dedicated to a particular brand.

63 Who Pays? Sometimes, Consumer 1 pays for the privilege of basking in a brand’s cachet (e.g., buying a “brand-name” product for conspicuous use). Sometimes, the brand’s owner pays Consumer 1 to deliver its marketing message (e.g., autowrappers pay drivers a monthly stipend). Most often, the brand will pay to create and launch the consumer-based campaign, including researchers’, consultants’ and recruiters’ fees, but not actually pay consumers themselves to participate. Recruitment Methods There are a variety of means for recruiting participants. Sometimes, the brand owner actively works to attract Consumer 1 (e.g., handing out band-logo temporary tattoos at a music festival). Some owners “seed” the street with marketing messages to attract Consumer 1 passively (e.g., placing free, well-stocked postcard kiosks in trendy restaurants and bars). Sometimes, Consumer 2 is a likely target for conversion into a Consumer 1 (e.g., encouraging online consumers to forward web sites to friends by placing an easy-to-use button at the bottom of a webpage). Multilevel marketing systems such as Amway and Mary Kay are not included in this table, even though these methods rely upon consumer-driven, word-of-mouth marketing. These methods are omitted because participants in such systems are functioning not only as communicators of promotional messages, but also as direct sellers and distributors for the products, and recruiters for new salespeople (www.amway.com).

64 IMPLICATIONS FOR MANAGERS AND RESEARCHERS Why do consumer-based promotions work? In analyzing the effectiveness of peer-to-peer promotional techniques, a key question to answer is: Do consumer-based promotions change consumers’ attitudes through central or peripheral channels of perception (Petty and Cacioppo 1986)? In other words, do consumers really notice the brands that they are marketing to each other, or are they buying and using them without realizing jut how valuable their participation in the process actually is? Based on the variety of techniques currently in use, we argue that advertisers believe that it can be either, or both, depending on the message, the product, Consumer 1, Consumer 2, the environment, and other mediating factors. When consumer-based promotion works primarily at the peripheral level, it indicates the following chain of events. First, there is an apparent nonchalance on the part of Consumer 1, and this results in lowered anti-marketing perceptual filtering by Consumer 2. These lowered defenses lead to an increased penetration of marketing messages (i.e., awareness of logos and brands). Firms’ adoption and use of peripheral-based techniques (e.g., simply affixing an identifiable logo to all the firm’s materials) seems to follow this “It can’t hurt” strategy. Another explanation, for situations in which conspicuous consumption and status-seeking are important (Veblen and Mills 2000; O’Shaughnessy 1987), is that consumer-based promotion operates through a central cognitive route. That is, consumers routinely take notice of each other on a conscious level. Because there is a reflexive relationship between consumption choices and communities, what we wear, drive, and otherwise consume convey social and utilitarian meanings about ourselves to other people (Arnould et al. 2004). Consumers’ intense observation of others’ consumption choices triggers metacognition and/or metaperception.

65 Metacognition is the process of thinking about thinking, either about what is happening inside one’s own head, or inside others’ (Jost et al. 1998; Petty et al. 2002). When consumers ask themselves if they are making the right decisions, or coming to the correct conclusions; when they wonder if they have all the facts; when they wonder if the salesperson is really giving good advice or merely trying to make a sale, they are engaging in metacognition. In all stages of the consumption process, from pre-purchase search to post-purchase evaluation, people generate beliefs and then challenge and validate them through metacognition (Kruglanski 1989, 1990). A hypothetical example of process is illustrated when an established shoe manufacturer introduces a new type of skateboard shoes. A teenage boy, Jason, sees the new brand and thinks it looks cool, but is reluctant to buy it because it might be too trendy and not acceptable among real skaters. Later, he notices that a classmate, Nick, who is a skater and one of the cool kids at school, is wearing the shoe. Jason’s original opinion about the shoe’s street cachet (its coolness) is validated. At the same time, his evaluation of the shoes as useful skate equipment increases. In this way, Jason learns to trust his own opinion about what is cool (and what isn’t). He recognizes that his initial assessments of the shoes’ qualities are valid, based on their convergence with the beliefs and behaviors of others around him. Through metaperception, people pay attention to what others think about them (Laing et al. 1966). In the preceding example, Nick, the cool skater kid, could use Jason’s imitation of his footwear to reinforce his belief that other people think he is cool. Furthermore, Jason could observe the way others treated him, following his purchase of the new shoes, and adjust his behaviors (including purchase behaviors) to generate positive reactions from other people. From a postmodern perspective, both metacognition and metaperception play important roles in consumer choices. As stated earlier, we as consumers synthesize public identities

66 through a mix-and-match process of consumption. During the process, we step outside of ourselves to gauge other people’s perceptions of us. We wonder if we are making wise, socially acceptable consumption choices. As social animals, we behave in accordance with images we are trying to portray to others (Firat and Venkatesh 1993; Albright et al. 2001). Consumer-based promotional techniques rely on these established cognitive and behavioral principles in order to heighten both brand awareness and brand equity. Brands are only meaningful if consumers adopt and use them. An Agenda for Future Research What is the relative effectiveness of various consumer-based promotional techniques? A systematic content analysis of peer-to-peer techniques would reveal ways in which they have been able to harness consumer power to disseminate information. Are the “sexier” methods, such as creating and distributing personalized electronic advertisements, better at raising overall awareness of the brand than more traditional variants of word-of-mouth (e.g., postcards), or even of plain old word-of-mouth itself? Are certain methods more effective at generating sales than others? For example, does eating from “gift” dishes have a more lasting impact on children than playing with branded toys? Is there a significant relationship between its features (e.g., risk, initiation) and the overall effectiveness of a consumer-based promotional campaign? Are there interaction effects between features? Are some brands more successful than others when they are associated with consumerbased promotional campaigns? What brands and products are most suitable for such methods? Are there any brands for which consumer-based promotions would be ineffective, or even detrimental, to their overall objectives?

67 How do consumer responses vary across the methods shown in Table 3.1? Does the success of a peer-to-peer campaign depend on the ages of the participants? Kindergarteners demonstrate an amazing level of brand literacy. Does this come from traditional advertising, from mere exposure, from acculturation or from consumer-based promotions (including honest old-fashioned word-of-mouth)? To what extent are adult identities shaped by lifelong patterns of consumption and self-brand identification? What is the role of brands in creating consumption communities? Many theories (e.g., those relating to information processing, choice behavior, self-concept formation) need to be reexamined and potentially modified in an age of commercialization and commodification of the consumer. The creation of personal identities and multifaceted lifestyles are topics of particular interest to managers and marketing scholars. It is important to understand the cognitive processes stimulated by consumer-based promotions. Is peripheral exposure (in the form of branded items) enough to influence consumer decision-making, or does it merely add to the advertising “noise” that these peer-to-peer techniques are trying to break through? How aware are consumers of our conspicuous consumption choices? How aware are we of others’ choices? How do consumer-based promotional methods influence the relationship between consumers and corporations? Do consumers appreciate the more personal approach that consumer-based methods seem to offer, or do they rebel against the commodification of formerly private spaces? Anti-corporate and anti-consumption behaviors and attitudes are just starting to be identified and tested, and they present new perspectives for studying consumer behavior (Austin et al. 2005; Zavestoski 2002). Research may uncover both latent and overt resistance to consumer-based promotions. Consumer resistance to traditional means and media of commercial

68 persuasion lies at the heart of these peer-to-peer techniques. If there were no resistance, there would be little need for advertisers to experiment with consumer-based promotions. There is a distinct group of consumers who are concerned with “McDonaldization,” i.e., western capitalism’s apparent effects on global economics, politics, cultures and the environment (Ritzer 1996). Some consumer-based techniques, namely tattooing and graffiti, have attracted similarly negative attention from consumer and environmental advocates. What sort of regulation is necessary to protect consumer-marketers who choose to participate, knowingly or not, in these campaigns? Are children, teens, or other segments of the population especially vulnerable to risks presented by peer-to-peer methods, and therefore in need of special protections? CONCLUSION The promotional methods discussed here are constantly evolving in tandem with technological and socio-cultural changes. By its nature, consumer-based promotion is a topic that seems well suited for interdisciplinary inquiry. Among the fields that have potential to contribute are social psychology, mass communication, perception and cognition, business administration, marketing, information systems and others. Some peer-to-peer promotional techniques (e.g., postcards) have been around for years in various forms, but their full commercial potential is presently expanding, as is the overall menu of consumer-based marketing opportunities. Their use is accelerating partly due to a paradigm shift in the marketplace, as firms are realizing that their own customers are potentially great allies for communicating key messages. The ultimate impact of consumer-based promotional techniques depends on the direction and strength of consumers’ connections to the brand. Consumers’ creativity, insights, and

69 energy are crucial to pass along brand messages to others, but there is no guarantee that one consumer’s excitement about any viral promotional technique, or about the brand itself, will be contagious in others. The quality, content, novelty, and entertainment value of the marketing messages themselves determine how widely and quickly information is transmitted among consumers, and smart brand managers will take these variables into consideration in any consumer-based promotions that they propose. Consumer-based promotional techniques rely on established cognitive and behavioral principles in order to heighten both brand awareness and brand equity. They operate through both active and passive consumer processing mechanisms, though why they actually work, and how effective they actually are, are still largely unexplored in the academic literature. Their longevity and proliferation in the marketplace indicate that managers intuit that they are effective for communicating brand messages, even in the absence of hard evidence that they work. What we do know is that brands are only meaningful if consumers believe in their meanings; through their use and contagious adoption, these meanings are reinforced even as they evolve. In the following chapter, we explore lifestyle brand managers’ understanding of p2p techniques using a case study approach. We interview managers of three successful lifestyle brands, create a conceptual model of how lifestyle branding and p2p communication are related to each other, and generate propositions to explain these relationships.

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75 www.thespecspot.com www.voteswap.com www.zillow.com

76

CHAPTER 4 LIFESTYLE BRANDS, PEER-TO-PEER MARKETING, AND STRATEGIC EMPATHY3

3

Austin, C.G. and G.M. Zinkhan. To be submitted to Journal of Marketing.

77 INTRODUCTION There is a large amount of anecdotal, business and popular-press literature related to lifestyle brands and branding (e.g., Lieber 2001, Reidy 2002, de Mesa 2004, Hogeboom 2005, Chamberlain 2007), but scant material published in academic marketing journals related to the creation and maintenance of lifestyle brands. Some successful lifestyle brands include Subaru, Harley-Davidson, Ikea, Clif Bar, and Martha Stewart. Current academic research related to lifestyle brands revolves primarily around the retail environment, such as the layout of a store or how effective salespeople are at conveying a brand’s aura to customers (e.g., Pettinger 2004, Wigley et al. 2005). The disparity between academic and non-academic work is why we study lifestyle branding. Several authors advance precursors to the notion of the syndetic lifestyle brand. Keller (2003) writes, “marketers often must link or associate their brands with other people, places, things, or brands as a means of building or leveraging knowledge that might otherwise be difficult to achieve more directly through product marketing programs” (597). Thompson et al. (2006) emphasize the empathetic nature and lifestyle effects of emotional brand management, and extend theory related to consumer judgments of authenticity (cf., Lewis and Bridger 2000, Guidry et al. 2008). However, none of these authors connect these ideas with the popular concept of lifestyle branding. This chapter provides a case study of three relatively new firms that position themselves as lifestyle brands; they rely on consumer-based, or peer-to-peer (p2p) communication (Austin et al. 2007) as fundamental elements in their promotional strategies. The brands are Jones Soda (established 1996), Cloudveil outdoor sportswear (est. 1997), and Jittery Joe’s coffee shops (est. 1994). Lifestyle brands achieve market success by creating unique, authentic brand identities, by

78 being innovative, by thinking about their core consumers’ wants, needs, and values, and by empowering their customers to disseminate marketing information on their behalf. The strength of lifestyle branding lies in the fact that all the elements of the marketing function (i.e., the 4 Ps) work in concert to create a single, robust, multidimensional brand identity. Table 4.1 compares examples of lifestyle brands and non-lifestyle brands within similar product categories, and highlights the key attributes that the non-lifestyle brands do not possess. Note: Table 4.1 is reproduced from Chapter 1 of this dissertation. Chapter 1 provides detailed explanations for each brand and each of the key attributes included in the table. “Clutter” (a marketing term) or “noise” (in communication literature) diminishes promotional effectiveness. For an excellent overview of the academic work on the subject, see Rosengren (2006). Increasing numbers and new forms of promotion contribute to the problem they are designed to combat. Kitchen et al. (2004) argue that the proliferation of clutter spurs the development of innovative integrated marketing communications (IMC) strategies and techniques. In particular, variations on word-of-mouth have built a reputation for successful clutter busting, and for making an impact on consumers’ perceptions of brands. We assert that lifestyle brands are more likely to be successful when they foster, but do not push, brand-based consumer communication. As with most brands, lifestyle brands address consumers’ core values through both their tangible and symbolic qualities. Their symbolic meanings go beyond those ascribed to the products themselves. Rather, consumers hope to possess and project the qualities that these brands represent (Helman and de Chernatony 1999). In the marketing literature, a number of authors have described the strong emotional connections between consumers and brands (e.g.,

79 Table 4.1: A comparison of lifestyle and non-lifestyle brands Lifestyle Brands Market perception Rugged, efficient, durable, fun, beloved

Indicators of authenticity In mountain towns and snowy places, for outdoors lovers, at rally car races

Marketing innovations Small AWD cars, zero landfill plant*

Wholesome, nourishing, convenient, delicious, friendly Innovative, cool, stylish, high performance, high quality

For hikers, backpackers, kayakers, cyclists, in the backcountry, at races, using wind and biodiesel energy Tied to Jackson Hole, employee users, pro fishermen, skiers & climbers

Organic foods and sports drinks, women-specific foods, recyclable packaging New fabric technologies, performance clothing design

Jones Soda: niche beverage

Cool, fun, friendly, stylish, delicious, independent, “the little guy”

Found in small shops (e.g., skateboard), consumer input on web and packaging, alternative sports venues, tied to Seattle

Jittery Joe’s: franchised coffee shop

Hip, friendly, small, inviting, sporty, local

Tied to Athens, GA, and other college towns, domestic cycling team, beans distributed in bike shops

Consumergenerated package designs, unique soda flavors, interactive website Personal distribution and promotion of beans, cycling team

Name Subaru: international brand

Clif Bar: energy bars, gels, and drinks

Cloudveil: Clothing

Expressed brand values Resource conservation, superior engineering, safety, durability, love of nature Organic farming, conservation, love of nature, women’s health, pleasurable consumption Quality, technological innovation, resource conservation, durability, style, utility Supporting the everyman, uniqueness, beautiful design, independence

Produser * communications Fan websites and blogs, online forums, homemade videos and ads, clubs, unofficial contests

Local support, beautiful design, healthy living, positive social spaces and interaction

Fan websites and blogs, online forums, homemade photos and videos, fan art at races, consumer-team interactions, Patron program

Marketing innovations Online sales and distribution, accurate recommendations Uncertain

Expressed brand values Uncertain

Produser communications Gift registries and wishlists, product and vendor reviews (written and video) Uncertain

Branded clothing items, local cycling clubs (i.e., Luna Chix), blogs, podcasts, pro and amateur ambassadors Online forums and blogs, homemade videos, unofficial contests, branded clothes, pro and amateur brand ambassadors Fan websites and blogs, online forums, consumer submissions of art, writing, and music, branded products, amateur brand ambassadors

Non-lifestyle brands Name Amazon.com: international brand Snickers: candy and energy bars American Living: clothes Jägermeister: niche beverage

Market perception Good selection & prices, convenient, friendly Delicious, satisfying, convenient

Indicators of authenticity No clear connection to location, core users, events

Sporty, casual, overpriced Hard-core, dangerous, intoxicating, extreme

Tied to Ralph Lauren, sold at J.C. Penney Tied to Germany, used by rock stars and college students, found at parties and bars

Uncertain Uncertain

Luxury, comfort, style, value Extreme behavior, overindulgence, risktaking

No clear connection to location, core users, events

Online sales, coffee bean subscriptions

Freshness, cleanliness, flavor, friendliness, speed

Dunkin’ Delicious, Donuts: convenient, franchised fattening doughnuts and coffee shop * Explained below ** www.urbandictionary.com

Sponsors NASCAR, the NFL, Little League, bass fishing

Convenience

Uncertain Branded products (including clothing and other personal items), volunteer brand ambassadors, branded postcards, Urban Dictionary entries** Branded cups and clothing, corporate and personal gift ideas

80 Belk 1988, Schouten and McAlexander 1995,Muniz and O’Guinn 1997, Fournier 1998, McAlexander et al. 2002; Hollenbeck et al. 2008). Lifestyle brands can elicit such emotional reactions, but go even further; they “reach a higher level in terms of the kind of connection [they] make with the customer” (Lieber 2001: 1). Work by Peñaloza and Venkatesh (2006) is the touchstone for this inquiry. This article states that markets are socially constructed by producers and consumers, and that value in markets is the result of both creation and use. The authors call consumption meanings “the overlooked component in value” (304); these meanings are a key element for the new paradigm of marketing. Peñaloza and Venkatesh encourage researchers to view producer/ consumer relationships as subject/subject interactions, rather than subject/object (308). As they point out, “marketers consume and consumers produce” (303). The idea of equity-generating producer/consumer associations is reinforced by other research (e.g., Aaker 1991, Keller 1993, Escalas and Bettman 2003 & 2005). In this chapter, our research informants – marketing managers – are themselves simultaneous producers and consumers of their brands’ meanings. When these managers draw upon their own values, attitudes, and lifestyles to establish and grow these brands, they create a sense of authenticity that customers understand and respond to emotionally. This position allows their empathy to work as a strategic asset to facilitate successful lifestyle branding. However, it is important to recognize that consumers’ emotional responses can be negative as well as positive (Thompson et al. 2006). This case-based study contributes to marketing theory and practice by introducing a theory of strategic empathy. Zaltman et al. (1982) describe a comprehensive method for developing theory-in-use that we follow to develop our ideas. Theory-in-use is an inductive way

81 of analyzing practitioner information in order to build marketing theory (e.g., Kohli and Jaworski 1990). Zaltman et al. (1982) write, “Theories-in-use interact with the behavioral world. The understanding of one requires the understanding of the other” (119). Zaltman et al. explain that “the best indicators [of effective managerial practice] are those which may be observed unobtrusively” (127); as such, we address lifestyle branding a number of ways. We examine the official literature that the firms generate, such as websites, catalogs, and promotional materials. In addition, we seek out unofficial brand-related information like consumer-created websites, postings in internet chat rooms, and personal observations. We compile media reports on all aspects of these brands, such as corporate profiles, stock information, history, fan-behavior stories, new product launches, product reviews, etc. This information is supplemented with emails and depth interviews with marketing directors from each firm. Compiling information from multiple sources achieves a level of convergent validity within and across the brands. Although much of this data comes from non-academic sources, our analysis is guided by theory, most notably self-brand identification (Sirgy 1982) and strategic interactionism (Blumer 1969). Kohli and Jaworski (1990) recommend this method of data analysis in order to provide “a rich set of ideas and insights” (2). In this chapter, we present cases of three successful firms, and integrate the individual analyses to develop principles for creating and growing successful lifestyle brands. We generate a conceptual model (Figure 4.1) and propositions (Table 4.2) to explain links between these concepts (Deshpande 1983). We conclude by discussing the implications and limitations of our findings for marketing and managerial research.

82

Relative positioning Late entry Model II leadership Conservative growth

Success Creativity

Peer-to-peer communication

Stakeholder dialogues Small

Efficient

Customer interest in brand lifestyle

Strong brand identity

Place Authenticity

Fashion trends

Manager confidence

Core users Manager lifestyle

Consumer affinity

Manager understands customers

(-)

Brand is a friend

Logo

Symbolic meaning

Manager values

Brand values Emulate core users

Customer identity

Figure 4.1: Strategic empathy and lifestyle brand management

Customer values

Customer lifestyle

83 CONCEPTUAL BACKGROUND The idea that group thinking (though not “groupthink*”) is often the best way to answer a question receives a lot of interest in the business and popular press (e.g., Gloor 2006). In The Wisdom of Crowds (Surowiecki 2004), the author examines the outcomes when a large number people collaborate, formally or informally, to generate cultural realities (e.g., election results, gasoline and housing prices, popular baby names). Open-source computing platforms, such as Linux, wikis, Google Apps, and CoScripter have revolutionized the way people create, share, revise and reinforce their collective knowledge (e.g., Tapscott and Williams 2006). A related idea, advanced by Henry Chesbrough (2003), is open innovation. In open innovation, firms are permeable to ideas, both incoming and outgoing, thus promoting efficient allocation of resources. Open firms can strongly establish their core competencies, obtain assistance and insight in areas where they are weak, and outsource processes and ideas that are not efficient (e.g., to other firms, universities, partners). Eric von Hippel writes extensively about innovation and information flow, recently focusing on consumers as members of “horizontal innovation networks” (von Hippel 2007). Von Hippel defines these networks as “user nodes interconnected by information transfer links which may involve face-to-face, electronic or any other form of communication. User networks can exist within the boundaries of a membership group but need not” (2-3). This loose structure may or may not support an actual community, but information sharing, idea replication, and continuous improvement are crucial elements for successful horizontal networks. Peer-to-peer marketing can be considered a form of “crowdsourcing” (Howe 2006), a phenomenon in which tasks formerly performed by a small number of employees (e.g., *

“Groupthink” describes the phenomenon in which conformity is presumed to be wise and good, even in the face of evidence to the contrary, i.e., when the group is wrong (Whyte 1952).

84 marketing or advertising executives) are now performed by a group of undefined, often anonymous people. Those people who engage in p2p marketing efforts are “produsers,” a combination of producers and users (Bruns 2005). The gist of these ideas can be summed up by science fiction visionary William Gibson: “The street finds its own uses for things” (Gibson 1986: 199). This chapter looks specifically at firms that have accepted the inevitable and embraced open communication. Lifestyle brands expect that consumers help to create and carry their messages. In this chapter, we argue that p2p marketing is an important component for lifestyle branding to be successful. Advertising and mass communication devices do not have lifestyles; consumers do. THEORETICAL BACKGROUND The difference between lifestyle branding and p2p marketing is that consumer-mediated marketing communication is necessary but not sufficient to create a lifestyle brand. Both lifestyle branding and p2p promotions stem from the idea that identity signaling among consumers is a powerful market force. As such, we draw on two theories from the marketing-associal-science literature in order to develop research questions. Self-brand identification (Sirgy 1982) posits that consumer behavior is generally predicated on the resonance between consumer self-concept (either actual or ideal) and the symbolic value of a brand. This theory is an integral part of consumer behavior research (e.g., Belk 1988, Aaker 1991, Keller 1993, Fournier 1998, Muniz and O’Guinn 2001, Escalas and Bettman 2003 & 2005). Symbolic interaction theory compliments this idea by proposing that objects have meanings, and that these meanings are subject to interpretation and re-interpretation based on individual uses, social interactions, and contextual influences (Blumer 1969, Singelmann 1972, Solomon 1983, Zavestoski 2002, Escalas and Bettman 2005). Recent work indicates that

85 conspicuous consumption is alive and well in the 21st century. Berger and Heath (2007) find that “People use symbolic domains to make identity inferences about others, but the particular identities that are inferred depend on who else holds the taste” (Berger and Heath 2007:132). In other words, consumers attempt to understand their own and others’ personalities, values, and interests based on the brands they choose to display. The management, and even the ownership, of brands is socially negotiated, moderated by news media, advertising, government regulations, websites, produser communication, and other sources/conduits of information (Keller 2003, McAlexander et al., 2002, Holt 1997, Holt 1998). Escalas and Bettman (2005) write that “brand use by reference groups is a source of brand meaning” (379), and that “consumers appropriate the meaning of brands as they construct their self-identities” (380). In short, consumer understanding of brands is influenced by context, while context is simultaneously being created by brands and consumers. Reciprocal symbolic relationships between self, other, and brand are implied every time marketing managers attempt to build their brands by using consumers as message-bearers. Singelmann (1972) sums up the importance of this idea, stating, “Society consists essentially of overlapping networks of symbolic interaction” (415). In socially congruous networks (Visser and Mirabile 2004), group members share attitudes related to salient items (e.g., brands, hobbies, etc.). It is network congruity that sustains lifestyle brands’ meanings within the small, closelyknit affiliations of the firm (i.e., brand managers), and in the looser networks of the marketplace. The notion of overlapping social networks as the basis of public opinions (as opposed to a small number of select individuals’ influencing the greater society around them) finds empirical support in Watts and Dodds (2007). Members of social networks are more likely to influence each other than strangers are, but within networks, influence is dispersed, rather than

86 concentrated. This explains how p2p communication strengthens lifestyle brands – consumers of these brands mutually reinforce the brands’ and their own values through conspicuous display of their own, and decoding of others’, chosen brands. Managers who appreciate the influence of overlapping social networks make organizational decisions that help create successful lifestyle brands. A Model II orientation (Argyris 1976, 1982) is essential for a firm to be successful when marketplace conditions are complex and uncertain, as they are in modern western society (Argyris 1982, 1990). The governing values for Model II organizations are: • • • • •

continuous and open access between individuals and groups; free, reliable communication; interdependence as the grounds for cohesiveness; trust, risk-taking and helpfulness; and integrative (rather than win-lose, zero-sum or distributive) conflict (Bokeno 2003: 638).

The action strategies for this orientation are “to combine advocacy with inquiry, to minimize face-saving, and to encourage the acceptance of personal responsibility” (Argyris 1982: 19). If followed, the result is effective managerial problem solving. The brands in this case study benefit from being later entrants to the marketplace, because they learn by observing earlier entrants, and embrace Model II principles of interdependent problem-solving and communication. We assert that lifestyle brands come into being as Model II organizations, i.e., they are consciously open and flexible in their managerial decision-making. We call this Model II theory-in-use “strategic empathy.” THE FIRMS Cloudveil Cloudveil Mountain Works Inc. is an outdoor apparel company based in Jackson, Wyoming. Conceived by two friends, Brian Cousins and Steve Sullivan, in 1994, the brand officially launched in 1997. The firm’s original product line consisted of eight pieces of ski

87 apparel specifically designed for backcountry skiers (Petri 2007). Cloudveil revolutionized the winter sportswear market by introducing Austrian soft shell technology to American outdoor enthusiasts (Kessenides 2005). Soft shell clothing is highly water- and wind-resistant, yet soft and flexible, offering simultaneous protection, comfort, and mobility. It is a technological innovation that appeals to hard-core and recreational users alike. Cloudveil’s website states, “We had no idea what building a brand required; we simply dropped in with the confidence that a mountain perspective would make a difference” (www.cloudveil.com). Despite the founders’ modest business knowledge, the firm has grown considerably in the past decade. By 2002, Cloudveil offered 150 products for sale, to the tune of $2 million annually (Kessenides 2005), and its 2006, its revenues grew by a record 87% over the previous year (ww.cloudveil.com). Cloudveil opened its first flagship store in Jackson in March 2007, hoping to generate $1 million in sales at this location in its first year. The brand plans to open one new store annually (Petri 2007). On February 5, 2008, Spyder Active Sports, a ski apparel company based in Boulder, Colorado, announced that it had wholly acquired Cloudveil. Cloudveil remains a separate, independent business unit within the Spyder portfolio, and it continues to operate out of Jackson with no changes in management. In a press release announcing the deal, Spyder president and CEO Jake Jacobs said, “The Cloudveil team has done an amazing job of creating an authentic outdoor brand. They live and breathe the outdoor mountain lifestyle and are all hardcore users of the product” (“Spyder Active Sports…” 2008). Cloudveil’s growth has been largely organic, based on WOM about its technically innovative and stylish product offerings. There are myriad online user reviews of Cloudveil’s clothes and fishing gear, which score very high ratings overall, especially related to technical

88 issues, fit, and styling. The majority of the criticisms are small changes that user-reviewers would like to see. For example, on the Westfly (fly fishing) weblog, Scott Richmond writes of Cloudveil’s 8X jacket, “I found the neoprene cuffs a little loose. Yes, you can tighten the outer cuffs down on them, but they still let a little rain in…. On the other hand, this is a problem, to some degree, for every rain jacket I've used” (www.westfly.com). Cloudveil’s roots are deeply embedded in mountain culture; in fact, the firm hosts a weblog called “The Mountain Culture,” where contributors write and post videos about skiing, cycling, film festivals, climbing, local parties, dogs, beer, and anything else that fits within the blog’s title (www.themountainculture.com). Authors and readers comment and discuss posts with each other. Also on Cloudveil’s website are biographies and photographs of the brand’s “Ambassadors,” described as “proven, dedicated mountain athletes who raise the brand to new heights as they put Cloudveil products to the test” (www.cloudveil.com/culture/athletes.php). Ambassadors include fishermen, mountain climbers, and snowsports enthusiasts of all kinds. The brand’s commitment to the mountain lifestyle continues in other ways. Their slogan is, “Designed and tested in Jackson Hole, WY.” Their retail store in Jackson encourages community interactions, for example, providing a lounge for socializing, and screening mountain-oriented films after hours. Cloudveil mentions Jackson Hole and the mountains in all their corporate communications. They donate 1% of their gross sales to an organization called 1% For The Tetons, which provides grants for regional sustainability programs. They also are partners with local and regional groups such as Teton Science Schools, the Jackson Hole Film Festival, the USA National Youth Fly Fishing Team, and Teton County Search and Rescue (www.cloudveil.com/culture/partners.php). Furthermore, they sponsor other athletes, events, and organizations on an ad hoc basis.

89 Cloudveil’s employees are universally interested in these pursuits, from the brand’s founders to the customer service reps who answer phones and process orders. Sullivan and Cousins have a video on YouTube (www.youtube.com) featuring themselves as they climb Cloudveil Dome (one of the Tetons) on June 24, 2007 to celebrate the firm’s tenth anniversary. This is the most crucial aspect of the firm’s branding – that the people who work for Cloudveil do so because they embrace the lifestyle that the brand represents. Jones Soda Jones Soda launched in January 1996 with six flavors of soft drinks. Initially, the firm distributed its products by placing branded coolers stocked with Jones drinks in non-traditional venues, such as tattoo parlors, skateboard shops, music stores and fashion retailers. Once the drinks started to take off in the marketplace, Jones began growing its distribution network, including small convenience stores and food markets. Eventually, they acquired national distribution rights with vendors such as Target, Starbucks, Barnes & Noble, and 7-Eleven (www.jonessoda.com/files/about.php). During this period of expansion, they increased their customer base through similarly non-traditional promotions. Jones Soda sponsors amateur and professional athletes in lifestyleoriented sports, such as skateboarders, surfers, snowboarders, and a women’s roller derby team. The brand also sponsors tattoo artist and reality TV star Kat Von D, and supports a separate website called MyJonesMusic.com, where independent bands and artists can showcase their music and interact electronically with each other through message boards and blogs. In keeping with its sports and music themes, Jones has two RVs that travel to sponsored events around the country, where staff members and volunteers pass out free drinks, t-shirts and stickers. Jones maintains a web page where attendees at these events can post their own photos

90 and comments. This is the heart of the brand – developing relationships with their customers by offering fun, quality products and inviting substantial consumer interaction (Bhattacharya and Sen 2003). Almost every page on the Jones website invites consumer input and feedback. There is a guestbook where people can rate Jones products on a scale of 1-10 and write comments. As of March 2008, the average overall score was 9.3, with comments both concise: “I LOVE Jones Soda,” and detailed: “I’ve been a Jones Soda fan ever since I drank my very first green apple soda at my dad’s house…. [etc.] I’m not ashamed to admit I was hooked from the very first sip!” (www.jonessoda.com/guestbook). Another page provides a forum for users to discuss the products and the brand in general. Jones’s most distinctive and innovative p2p promotional strategy is its packaging. Consumers submit original photographs to the Jones website, and the best pictures become new product labels. All submissions become part of an online photo gallery where people can look at and vote on each other’s work. Viewers can also use the site to email photos to other people; aspiring photographers can invite family and friends to vote on their submissions. To date, consumers have posted nearly 800,000 photos to the website. To keep the gallery from becoming unwieldy, photos are archived after six months. In addition to the labels, the underside of every Jones bottle cap reveals a “fortune.” These consumer-submitted messages include the author’s name and city, and can say anything from “Save a few bucks, change your oil yourself,” to “Usted es hermoso (You are beautiful).” In smaller type, the cap directs consumers to the company’s website, where they can submit their own entries. The fortune page displays other “winners,” and encourages users to “give someones [sic] future a real kick in the pants.”

91 The popularity of these ongoing contests led to the development of MyJones – a masscustomization program that allows consumers to order 12-packs of Jones Soda with their own photos and quotes on the bottles. Unlike the packaging for the retail bottles, which is determined by quality, MyJones will print almost anything on these small manufacturing runs. (The submission software even recognizes languages other than English.) The website suggests using personalized bottles for weddings, graduations, band promotions, corporate events, fundraising, or just “making a friend smile.” The price point for 12 sodas is $29.99 + shipping, in contrast to $18.99 for the same product with mass-produced packaging. Jones offers products and promotions that encourage consumer participation even in the absence of purchase. The “Campaign Cola” webpage encourages people to “vote” for the next U.S. President by buying soda with their favorite candidate’s face on the label (Pure McCain Cola, Yes We Can Cola, or Capitol Hillary Cola). However, even those consumers who do not buy are invited to read about the candidates via hyperlink to Politifact.com, and to discuss campaign issues amongst themselves in a Jones-hosted forum. Jones has also launched an Affiliate Program, in which bloggers and website owners link to Jones from their own websites. Customers who click through can buy drinks and other branded merchandise directly from Jones, and Affiliates earn a 10% commission. This program is independently audited by ShareASale, to ensure fairness to the Affiliates; Jones also provides phone and online access to the Dedicated Affiliate Team, who can answer Affiliates’ questions. Although Jones lost money in 2007, it was due to growing pains, rather than a drop in popularity with consumers (Ackerman, 2008). The brand made several big changes in 2007. First, they were only selling their products in glass bottles through select retailers, but their sales figures indicated that they should expand their product offerings (i.e., in aluminum cans) and

92 their distribution network (e.g., Wal-Mart). Second, Jones decided to hire a national advertising firm, Cole & Weber. Finally, they switched the sweetener in their products from high fructose corn syrup to cane sugar, at a cost of more than $1 million for retrofitting manufacturing equipment (Allison 2007). All of these changes proved to be costly. Delays in the development and distribution of the cans led to considerable losses in sales. This was the biggest reason for the firm’s poor financial showing in 2007; the switch to cans has been called “ill-fated” (Ackerman, 2008). The firm also faced higher-than-expected slotting fees in their expanded retail outlets, as well as increased promotional costs as they tried to spark sales and keep their momentum up. Jones’s poor showing in all four quarters of 2007, along with charges of insider trading – dismissed by the SEC (“Jones Soda: SEC” 2007) – resulted in the resignation of its founder, Peter van Stolk in December 2007. (This turmoil resembles the trouble that Apple, another lifestyle brand, experienced during a period of rapid growth, resulting in Steve Jobs’s being fired in 1985.) On the plus side, in May 2007, Qwest Field – home of the Seattle Seahawks – signed a five-year exclusive contract to sell Jones products in lieu of Coca-Cola (Harris, 2007). Until then, only Coke and Pepsi had ever signed exclusive deals with the 31 NFL team stadiums. With only 1.5% market share nationwide, this was a major coup for Jones. However, while Seahawks fans hail Jones as hometown heroes, analysts point out that this sponsorship is very expensive, and with only ten home games guaranteed per season, the stadium generates relatively little exposure compared with other distribution and promotional outlets (Harris, 2007). Jones positions itself among competing brands through its use of non-advertising promotions. It creates a network by sponsoring athletes, musicians, and artists, as well as other brands that endorse similar values. For example, Jones sponsors California tattoo artist Kat von

93 D, whose personal website (www.katvond.net) provides links to all her sponsors, such as Vestal Watches (www.vestalwatch.com). On their website, Vestal’s “story” reads, in part: We market and brand Vestal through our friends, musicians, artists, and athletes who have similar interests and enjoy living a rock inspired lifestyle…. Product placement on influential people and in respected retail stores has been Vestals [sic] most effective marketing tool…. True Vestal customers… cannot be pegged to any particular demographic. Vestals [sic] goal is to become more than a time-telling device but rather an extension of a rock inspired lifestyle.” (www.vestalwatch.com/#/OurStory/) Jones has also launched Jones Independent Music, a website that promotes p2p networking among musicians and music fans. Users can discuss the business and pleasure of music on bulletin boards, download and listen to others’ recordings, create and share playlists, read and/or write blogs, and personalize interactive maps for promoting their bands’ tours or venues they enjoy. Much of this website is still under construction, and it is not as heavily trafficked as the main Jones site. Still, the main page for the map (www.frappr.com) has “pins” stuck in it with Jones music fans posting photos and comments such as Nick’s from Boise, Idaho: “Jones Kix Butt.” Jittery Joe’s The third firm under examination is Jittery Joe’s coffee, which has a networked organizational leadership model. The retail stores are a mix – some owned by the corporation and some by individual franchisees; the president of the firm is Michael Ripps; the franchising is directed by Bob Googe and Karl Barnett. All merchandising, excluding coffee beans, is held under the supervision of Jed Schneider. The coffee roaster and bean sales are owned and operated by Charlie Mustard. The most visible aspect of Jittery Joe’s promotions is the professional cycling team they sponsor, which is owned by Spin Sports, LLC, under the direction of Micah Rice.

94 In spring 2008, Jittery Joe’s made several announcements related to the continuing success of the brand. It launched a new location on the campus of the Savannah (Georgia) College of Art and Design, and revealed plans to open a store by Mercer University in Macon, Georgia, in August. In addition, Jittery Joe’s began selling beans at two Whole Foods Market locations in Atlanta, with an option to expand. On the negative side, the brand opened, then within a few weeks, closed a store on the Georgia State University campus, due to sluggish sales (“ProShop99” 2008). Keith Kortemeier opened Jittery Joe’s, the first modern coffeehouse in downtown Athens, Georgia, in 1994. At 19, Kortemeier, a rock musician (e.g., Lesemann 2007), wanted to open a bar but was too young. He created a hip, fun second-best option, which was an immediate hit in the music-oriented university town (Rice interview). In its first decade, Jittery Joe’s expanded within Athens, ultimately closing the two original locations, while opening six new stores (www.jitteryjoes.com). In 2004, the brand began franchising operations around the southeast, as a result of four factors. First, large numbers of UGA alumni who move away from Athens with nostalgic feelings for the brand indicate a high probability of success in areas where they live, such as suburban Atlanta. Second, entrepreneurs want to invest in the brand as franchisees. Third, based on Jittery Joe’s success in Athens, especially in their location on the UGA campus, other college towns seem ripe for similar offerings (Brown 2004). Finally, and perhaps most importantly, the Jittery Joe’s pro cycling team has international recognition and popularity (Peters 2006). The team known as “The Bean Team” began its association with the coffeehouse quite informally, selling Jittery Joe’s coffee beans at races in order to raise money. Kortemeier describes the origins of the partnership as akin to “the high-school marching band selling candy

95 bars to get to Europe,” and “the punk rock band selling CDs out of the back of the van” (Rogers 2005). In 2003, Jittery Joe’s signed a formal 3-year sponsorship contract with the team management, who also continued selling the beans at races (Peters 2006). The next year, the Jittery Joe’s team experienced breakout success in several international races, most notably when Bean Team member Cesar Grajales soundly beat Tour de France champion Lance Armstrong in a mountaintop finish in the Tour de Georgia (Scrymgeour and Maloney 2004). At the time, Armstrong’s U.S. Postal Service/Berry Floor cycling team had an operating budget of over $1 million; in contrast The Bean Team was running on $100,000 (Peters 2006). Charlie Mustard, owner of the Jittery Joe’s coffee roaster says, “When Cesar won, we went international.... It was the purest marketing vehicle.” Micah Rice, who owns the team agrees: “That was a turning point. To attack Lance Armstrong with 2 kilometers to go and win on the hardest day of racing in the United States, you couldn’t write a better script” (Peters 2006). The timing was perfect for the brand – cycling was more visible than ever in the U.S. due to Armstrong’s public persona as cancer survivor and Tour de France champion. The Bean Team, with its tiny budget and roster of talented, unknown riders, were the sweethearts of the 2004 season (Rosen 2005). The brand’s coffee sales at races and in bike shops (more than 800 nationwide) took off, as did their franchising operations. In spring 2005, Jed Schneider debuted a vintage Airstream camper outfitted to sell freshly brewed Jittery Joe’s coffee drinks (as opposed to just the beans) to spectators at every stage of the Tour de Georgia, as well as at subsequent events such as races and new store openings (Rosen 2005). Also in 2005, Jittery Joe’s signed the longest sponsorship contract (10 years) in professional cycling history (www.thebeanteam.com). Spin Sports, LLC, which officially owns the cycling team, lines up other shorter-term sponsors such as BMW, Land Rover, Mini Cooper,

96 Kalahari Tea, Zero Gravity Brakes, Maxxis Tires, Shimano, and PowerBar. They also partner with locally owned (but nationally distributed) firms such as Tifosi Eyewear and Terrapin Beer. There is a lot of cooperation and support at the local level within this organizational network. For example, Terrapin sponsors the Jittery Joe’s cycling team, as well as partnering with the coffee roaster to produce a beer called “Wake-n-Bake Oatmeal Imperial Stout” that is made from “Terrapin Wake-n-Bake Blend” coffee (Townsend 2006). Jittery Joe’s is the official coffee sponsor of the Tour de Georgia. They create a special Tour de Georgia blend that is offered only during the spring, to coincide with the Tour. A portion of these proceeds to go to the AFLAC Cancer Center and Blood Disorders Service of Children’s Healthcare of Atlanta (press release, 24 March 2008). Jittery Joe’s executives Mustard and Googe are “partners in education” at an Athens elementary school (www.clarke.k12.ga.us). In addition to these partnerships, Jittery Joe’s runs a Patron Program – “The ultimate fan experience.” Patrons get to ride in the team car during races, receive exclusive team gear (such as bike components, glasses, and clothing), and live and ride with the team during a spring training camp. Patrons receive public recognition for their contributions, which are not always monetary – they can help the team by contributing business knowledge and network opportunities. (Its relatively small budget means the Jittery Joe’s team loses riders every year because it cannot afford to pay them once they are no longer unknown.) The Patron Program is an excellent p2p opportunity because many of the rewards (dinners, rides) are open to patrons and their friends. In Athens, local cyclists frequently have the opportunity to ride with team members on long-standing group training rides (although they are not guaranteed to have any interaction with team members). Maintaining a high level of interaction between the team and the community is

97 a priority for the brand. The Jittery Joe’s website includes the following statement from Karl Barnett, M.D., managing partner for franchising, regarding the brand’s sponsorship of the cycling team: To us this is more than a logo on a jersey, it is a relationship that embodies the qualities that we as producers of the finest coffee in the world would like to foster hard work and hard play. Although it’s nice when we win, we believe that it is more important to stay healthy and active. We think it’s important for your physical health and your mental health. To me nothing gets that message across like the wonderful sport of cycling and the endurance sports with which it is associated. Stay active, stay healthy, and keep the rubber side down. Jittery Joe’s also offers customers other opportunities to interact directly with the brand in a variety of ways off the bike. The roaster develops “Private Label” coffees for restaurants or other organizations that request them. The team’s riders are also writers, posting training and racing reports on the official team weblog and inviting comments from readers. Some riders also contribute regular diary entries on sport-specific websites such as CyclingNews, or maintain their own web sites. There are official brand pages on both Flickr (photos) and YouTube (videos), plus riders and viewers post their own materials through these same channels. Some posts have thousands of page views. This emphasis on interactivity is apparent in consumers’ comments on the Jittery Joe’s weblog: “Thanks to Neil for taking time out to meet my brothers 3 kids who have never seen a bike race! what an experience for them! Each time the peleton would pass the start finish they would be routing for the team! They would say ‘there’s the guy’…..” (posted by BB 18 May 2008) Some franchisees host blogs of their own where they discuss riding and coffee. Rewards for winning training races include JJ’s “swag,” and rides all start at the coffee shop (www.crabapplejitteryjoes.com). Franchise owners invite comments from readers/riders on these websites. The Peachtree City shop has a MySpace page (profile.myspace.com), complete

98 with music by Athens band REM. The background of this page features a sad-face Starbuckstype logo that says “Friends don’t let friends drink corporate coffee.” In the comments section, one happy patron writes “I *hEaRt* Jittery Joe's coffee!! WHO Bucks????” (posted by Helen 2 Aug 2007). Non-lifestyle brands Table 4.1 compares lifestyle and non-lifestyle brands, highlighting the key attributes that non-lifestyle brands lack. We now explain why these firms, although they share with the lifestyle brands profiled above, do not qualify. Amazon.com is a multibillion dollar, publicly traded firm (NASDAQ: AMZN) that sells everything from fantastic luxury items (e.g., Breitling watches) to the cheap and mundane (e.g., one-ply toilet paper). Amazon is, in essence, the world’s largest shopping mall, and it encourages customers to engage in p2p communication through wish lists and gift registries, product and vendor reviews, and written and video recommendations. It uses these p2p tools for three main reasons – to build consumer trust, to enhance their consumer research, and to encourage site visits from non-users (i.e., using gift registries). Amazon’s website and official communications are “friendly” and helpful, and its recommendations, based on statistical analysis of its database of consumer search and purchase information, can be amazingly accurate. (In 2007, The Onion, a satirical fictional newspaper, published a story entitled “Amazon.com Recommendations Understand Area Woman Better Than Husband.”) Consumers can use the site to facilitate their own lifestyles, however, Amazon itself is lifestyle- and value-neutral. It takes no discernable position on anything beyond its large selection, convenience and competitive prices. Therefore, Amazon is not a lifestyle brand, because it does not have values that consumers want to consume and promote.

99 The same can be said of Snickers bars, which generate more than $2 billion in sales annually (McCarthy 2005). Although obviously popular, the candy bar cannot be considered a lifestyle brand because it lacks values and lifestyle components – it is simply convenient and delicious. Its ubiquity diminishes its lifestyle appeal as well; rather than promoting a specific way of life, Snickers candy is available to anyone at any time. The brand also produces an energy bar called Snickers Marathon, but promotions for this product line are one-dimensional. Its website stresses the word “energy,” contains quotes from three endurance athletes, and provides links to information about upcoming endurance events, all reinforcing one basic message: food is fuel. In contrast, American Living, a new clothing brand by Ralph Lauren, sends conflicting messages about its identity. The brand tries to project comfortable, relaxed luxury, but it is distributed through J.C. Penney, a traditionally low-tier department store. Penney’s customers might not be able to afford the line, while those who can afford it generally shop at stores with higher price points and better reputations, such as Macy’s. This lack of coherence undercuts the brand’s authenticity and prevents it from building a strong identity, which is necessary to become a lifestyle brand. We offer more details about American Living in Chapter 2 of this dissertation. In comparing American Living with Cloudveil, we see that both brands’ visual images are strong. Both do an excellent job photographing situations that capture the feel of the brands. However, Cloudveil uses photos of real people doing things such as rock climbing, fishing, and skiing, and identifies who and where they are. This gives the brand substantial credibility among consumers who are interested in the lifestyle. In contrast, the American Living models are obviously models, placed and posed to achieve the desired effect.

100 Another key difference in the two has to do with consumers’ perceptions of price and distribution. American Living products are only available at J.C. Penney, and carry the highest price points of all the brands sold there. While a high price helps cement the brand’s image as being higher quality and more luxurious than Penney’s other offerings, it deviates from the store image, and calls into question how good the brand really is. Cloudveil, on the other hand, is available through their catalogue and in outdoor shops. Its products are fairly expensive relative to similar products available at large sporting-goods stores, but are in keeping with competitor brands that share distribution channels (such as Patagonia). Rather than contrasting with its surroundings, Cloudveil reinforces its own image and its consumers’ beliefs about the brand – that it is high quality, somewhat rare, and worth paying for. Jägermeister liqueur has a very strong market identity, favored by drinkers who want to be “hard core partiers.” Of all the non-lifestyle brands in this research, this brand comes closest to being a lifestyle brand – it has deep authenticity, a unified brand image and message, and it facilitates p2p communication. However, it is not a lifestyle brand because it does not have true values and lifestyle orientations. While the brand promotes and sponsors a variety of extreme behaviors, its true underlying message is a simple one, namely that binge drinking is acceptable, and even desirable. Jägermeister appeals to a wide range of consumers, who may have nothing in common besides drinking. Thus, this brand does not have a lifestyle orientation. We provide more information and analysis of this brand in Chapter 2 as well. Comparing Jägermeister with Jones Soda, we see that both brands generate an enormous amount of appeal relative to their overall size (cf., Jägermeister v. Jack Daniels, Jones Soda v. Coca Cola). In addition, both brands maintain a strong market identity despite their broadspectrum popularity, which is a testament to their brand management. However, Jones Soda has

101 a much better defined group of core consumers than Jägermeister does, and continually engages them to help adapt, refine and promote Jones’s image; Jägermeister’s image is strong, but static. Furthermore, Jones’s values message is much more complex than Jägermeister’s, promoting humanism and uniqueness, fearlessness and change, and celebrating the talents of “the little guy.” Finally, as a non-lifestyle analog to Jittery Joe’s, we examine Dunkin’ Donuts, which offers similar products and is in the process of growing its franchising. Much like Amazon.com and Snickers, Dunkin’ Donuts is highly successful – claiming the title of the “world’s largest coffee and baked goods chain” (www.dunkindonuts.com/aboutus/company/). In addition, the brand’s image is quick, clean, convenient and inexpensive, which are strong and positive attributes. However, as with the other large brands, Dunkin’ Donuts lacks authenticity and a distinct personality; it also lacks values and lifestyle markers. Dunkin’ Donuts would like to become a lifestyle brand, as evidenced by its coffee bean home delivery subscription service, and the branded sportswear it offers for sale, but without strong grounding in an espoused lifestyle, it cannot qualify. We posit that the brand’s name is another potential limiter for lifestyle acceptance. Doughnuts, while delicious and comforting, are perceived as fattening and bad for one’s health. (Jones Soda avoids this problem by offering diet sodas, vitamin drinks, and smoothies, and by emphasizing its use of natural cane sugar.) Dunkin’ Donuts’ current promotions place much more emphasis on its coffee than the food it serves, but the name is an element that customers might be loath to fully embrace. The retail environment also plays a role in the success of the franchise as a lifestyle brand. Dunkin’ Donuts stores, while clean and friendly, do not invite customers to linger, or to

102 seek it out for its symbolic attributes. On the other hand, Jittery Joe’s shops, while offering quick service to those who want and need it, also provide a distinct seating area for socializing, working, reading, listening to music, etc. Outside the shops, consumers who buy Jittery Joe’s beans can tap into the meanings generated by the stores’ atmospheres, their locations in college towns, and their support of professional cycling. (E.g., one of the roasts for sale is named “Morning Ride.”) Brands that have a strong link to people’s everyday lives can qualify as lifestyle brands, but not all of them do. Mindful consumption, which is related to involvement, plays the biggest role in whether a brand is a lifestyle brand. Crest is not a lifestyle brand, even though consumers can be very highly involved in choosing which oral care products are right for them. However, Tom’s of Maine, which sells toothpaste and other personal care products, is a lifestyle brand. The difference between the two is that Tom’s has a strong, value-oriented brand personality that appeals to consumers, while Crest does not. Tom’s researches and uses natural mineral and herbal ingredients in their products, and they do not perform animal testing. In addition, their products are kosher and Halal (www.tomsofmaine.com). Tom’s consumers can feel like they are doing good for the world and themselves every time they brush their teeth. Crest consumers have no such associations. Food and drink brands seem to follow the same pattern as other small consumer products, with some, but not all, being able to attain lifestyle brand status. Comparing Clif and Snickers bars, the primary distinction between them is the values and personality components of the brands. Innovations in product development are less important than innovations in production, promotion and distribution. Appearing interesting, trustworthy, small, and friendly plays a large part in lifestyle branding in these product categories.

103 How personal an item is, and how conspicuous it is, also plays a big role in whether a product or category qualifies as a lifestyle brand. There is no car available in the United States that is not positioned as a lifestyle brand – cars are personal and conspicuous. On the other hand, internet-only brands (e.g., Amazon.com) are neither personal nor conspicuous, and we are hardpressed to identify one that is a lifestyle brand. Clothing brands are perfect candidates for lifestyle branding, but as shown in the case of American Living, they do not always succeed. Franchising a lifestyle brand can be tricky, due to the nature of franchising. Homogenization is key for store expansions to succeed, but it is the antithesis of the personal and personality components of lifestyle brands’ success. Starbucks seemed to have figured out how to balance these competing needs, but in a press release issued July 1, 2008, the company announced it was closing 600 stores in the U.S. (investor.starbucks.com). Jittery Joe’s has put some franchise developments on hold, and is proceeding with caution on others, in order to be able to maintain the integrity of the stores’ atmosphere and the brand’s image. We elaborate more on these observations in the findings and discussion section of this chapter. PROCEDURE In order to examine and define the theory-in-use for lifestyle branding, the first step was to develop the interview questionnaire, based on our review of academic and managerial literature. The interview protocol was developed in light of guidelines proposed by Miles and Huberman (1994), Kvale (1996), McCracken (1988), Denzin and Lincoln (1994), and Thompson (1997). Previously identified elements of consumer-based promotional methods (Austin et al. 2007) are one basis of the interview questions and data analysis protocols. An example question of this type is, “How many p2p marketing ideas are based on input from the consumers of your

104 products?” which examines consumer commitment, the initiation of p2p communication, and recruitment. Other questions are based on the need to test theory. For example, “How many marketing ideas are based on your own experiences as a consumer?” relates back to self-brand identification, while “Are there people you prefer to see using your products?” and its counterpart, “Are there people you wish wouldn’t use them?” uncover the role symbolic interaction in the development of lifestyle brands. Finally, the conceptual material raises questions. “Do you perceive your customers as agents of your firm?” tests the idea of open innovation. “How do you encourage peer-to-peer interactions with regards to your brand?” examines managerial perceptions of crowdsourcing. We did not expect to ask every question of every participant, but rather to let these categories guide the discussion as the brand managers talked about their use and understanding of p2p marketing methods. The firms in this chapter have key commonalities, which Zaltman et al. (1982) describe as “indicators of effective practice.” The first indicator is longevity – each of these firms has been in business for more than a decade. The second is consumer loyalty – despite limited budgets and strong competition, these firms win the hearts and minds consumers who prefer them and proselytize on their behalf. The third indicator is creative innovation – these firms find success thanks to their ability to conceive of appealing alternatives to the status quo. The fourth indicator is a strong brand persona, which enhances consumers’ perceptions of their own values. Choosing firms that represent distinct product categories (clothing, soft drinks, retail franchises) helps form a more complete picture of successful lifestyle brand management. We can compare their espoused theories with their theories in use (Argyris and Schön 1974), as well as looking for elements of effective management across the three brands. This course of action is recommended in the literature (e.g., Zaltman et al. 1982, Kohli and Jaworski 1990).

105 To collect primary data, we contacted the marketing managers for each of the brands via email, explaining our university affiliation, outlining the scope of the project and asking for their assistance. These participants are Jeff Wogoman (director of marketing for Cloudveil), Mike Spear (in charge of myJones and e-commerce, Jones Soda), Micah Rice (owner of Spin Sports, LLC), and Kirk Smith (President of The AdSmith – in charge of marketing for Jittery Joe’s). In each case, they agreed to help with the research and provided informed consent that does not guarantee anonymity (i.e., all are willing to speak “on the record”). We arranged telephone interviews, and all agreed to provide follow-up information, either on the phone or via email, if necessary. During each interview, we started with a “grand tour” question (Spradley 1979), asking about the respondent’s work history, and how he got involved with the marketing of the brand in question. From there, we asked questions such as those described above, as well as others that emerged during the conversations that proved salient to the topic of p2p marketing and lifestyle branding. When necessary, we followed unexpected avenues of inquiry that elicited information and insights we had not expected. The interviews lasted between 2-4 hours. To analyze the interview material, we first read the interviews all the way through several times. In all cases, we emailed our respondents to ask for further information on certain points where we were uncertain about meaning or the notes were unclear. We read looking for primary themes to emerge in the broad categories we had identified earlier; placing the interviews sideby-side, we compared the firms with each other, noting similarities and differences. At this stage of data analysis, we asked a student research assistant with no prior involvement with the project to read and comment on the transcripts, and used his perception of the material as validation that we were not overreaching, nor missing important insights.

106 Next, we analyzed the interview notes, using axial and selective coding to identify categories and concepts and their interrelationships within each firm (Strauss and Corbin 1990, Wolcott 1990). Zaltman et al. refer to these as governing principles of the theory-in-use. We used the theoretical and conceptual background information as a means of examining what our informants said, individually as representatives of each firm, and collectively as executive decision-makers in the greater marketplace. During this iterative process, we examined all our collected material simultaneously and sequentially, in order to uncover how lifestyle brands leverage meaning for consumers, especially through the use of p2p marketing. Using outside materials in conjunction with the interview data allows comparison between these firms’ espoused theories of branding with their theories-in-use. We can test the consumer behavior theories that these firms implicitly endorse, as well as those related to open organizations. The following findings outline and elaborate on the major themes that emerge from the interview data. FINDINGS One overarching idea governing lifestyle branding emerges from this research. We call it “strategic empathy” – a high level of awareness that brand managers have about themselves, their brands, and their customers. They use this innate understanding to encourage consumers to promote their brands’ meanings and messages. The values and lifestyles that these brands embrace are the ways that the employees of these firms actually live; managers create brands with themselves as their primary target consumers. The governing principles that make up this construct are (1) Embrace Model II leadership, (2) Know thyself, (3) Know thy customer, (4) Don’t grow too fast, (5) To thine own self be true, (6) Do well by doing good, and (7) Embrace, but don’t chase, peer-to-peer communication.

107 We now explain the concepts underlying each of these ideas, and set forth propositions to describe relationships between them (Deshpande 1983). Table 4.2 summarizes the propositions and indicates if they are unique to lifestyle brands. These relationships are visually organized in the conceptual model (Figure 4.1). Principles of strategic empathy Embrace Model II leadership The time of the firm’s entry into the market is an extremely important aspect of lifestyle brand management. For both lifestyle and non-lifestyle brands, there are several advantages to later entrants, as they have an opportunity to observe and position their own brands relative to extant market offerings (Golder and Tellis 1993). In the three cases we examine, the brands’ founders were dissatisfied with existing products and decided to create their own brands. This consumer experience is the reason that they put Model II managerial practices into place (Argyris, 1982). Model II leadership encourages interaction and solicits input from people outside the organization (e.g., consumers), emphasizing the goals they hold in common. Model II leadership minimizes power distance (Hofstede 1980) among the firm’s stakeholders. As such, these organizations foster open communication, and encourage conflicts to come to the surface to be discussed and resolved. P1: The later the entrant is to the market, (1) the more likely it is to define its position relative to extant competitors and (2) the more likely it is to subscribe to Model II managerial principles.

108 Table 4.2: Propositions that define lifestyle brands

P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22 P23 P24 P25 P26 P27

Proposition The later the entrant is to the market, (1) the more likely it is to define its position relative to extant competitors and (2) the more likely it is to subscribe to Model II managerial principles. The more collaborative an organization’s management structure is, (1) the more creative its market offerings will be and (2) the more successful its market offerings will be. The smaller the firm, the more likely it is to embrace Model II principles. The more closely a lifestyle brand’s managers’ own lives mirror their brands’ ideals, (1) the more confident they are in their decision-making and (2) the stronger the brand’s identity in the marketplace. The more closely a lifestyle brand’s managers’ own lives mirror their brands’ ideals, (1) the better they understand their core customers and (2) the more attractive the brand is to its core customers. The more affinity a consumer has for the brand, (1) the more likely it is that he supports the brand’s values, (2) the more likely it is that he feels the brand helps him express his identity, (3) the more likely it is that the attraction is to the brand’s symbolic attributes and (4) the more likely it is that he considers the brand a friend. The more a lifestyle brand reflects some aspect of consumers’ lifestyles, past or present, the more affinity they will have for the brand. The more aesthetically appealing a lifestyle brand’s logo, the more affinity consumers will have for the brand. The more unique a lifestyle brand’s logo, the more affinity consumers will have for the brand. The more affinity consumers have for a lifestyle brand, (1) the more respect they have for its core produsers and (2) the more they try to emulate its core produsers. The more interest a consumer has in a lifestyle, the more receptive he is to p2p communication about a lifestyle brand. The more fashionable a lifestyle brand is, (1) the less likely it is that consumers practice the lifestyle it facilitates and (2) the more successful its p2p communication will be. The stronger a lifestyle brand’s core identity, the better it can weather (1) short-term market trends and (2) negative publicity. The fewer resources a lifestyle brand has, the more likely it is to pursue innovative marketing techniques. The fewer resources a lifestyle brand has, the more efficiently it will allocate those resources. The greater the disparities between the lifestyle brand and the market leaders, the more affinity consumers will have for the smaller brand. The smaller the lifestyle brand is, the more conservative the goals and growth strategies will be. The stronger a lifestyle brand’s authenticity, the stronger its (1) overall identity, (2) managers’ confidence and (3) symbolic appeal. The stronger the tie to place, the more authentic the lifestyle brand. The more consistent a brand’s personality, the more authentic the lifestyle brand. The more consistent a brand’s associations, the more authentic the lifestyle brand. The more consistent a brand’s attitudes, the more authentic the lifestyle brand. The more consistent a brand’s actions, the more authentic the lifestyle brand. The more authentic a lifestyle brand’s espoused values, the greater the emotional connection with consumers. The less emphasis on traditional marketing forms, the more appealing the lifestyle brand. The greater the brand’s active encouragement of p2p marketing, the less appealing the lifestyle brand. The greater a lifestyle brand’s reliance on p2p communication, (1) the more vulnerable it is to misinterpretation and (2) the more open it is to serendipity.

Unique (2) only

x x

x

x

x x

109 There is strong evidence of Model II leadership in the three case brands. All have websites that encourage conusmers to provide feedback, but they all go much further than that. Jeff Wogoman of Cloudveil says, We’ve put a face to our brand – people know who we are, they know our story: we’re demure, we’re humble and midwestern. When people tell us we do a good job, we say thank you. If you try to be “authentic,” you’re not going to do it. We screwed up fall ’06 deliveries, we called all of our dealers personally, and we had a bunch of them who said “If this had happened with [two bigger brands], we’d have gotten a call from the assistant to the assistant, after the deliveries.” Cloudveil keeps in regularly keeps in touch with dealers, calling and asking what products they like and don’t like, categories they need to be into, and other information that primary touchpoints can provide. These insights can be the dealer’s personal preferences or from an objective point of view. Wogoman comments, “We keep vendors through good, bad, and ugly. Long-term relationships are valuable, and we’d rather work through our problems than fire people when things aren’t going well.” In addition, Cloudveil keeps in close contact with consumers, often answering questions related to social and environmental issues. Wogoman says, We don’t get flack about offshore manufacturing anymore from consumers. Now they ask about our carbon footprint. They ask what we’re doing from an environmental or social standpoint… To do the most good, we’d all go out of business. So the goal is to do the least harm. We don’t claim to be anything we’re not. Mike Spear describes how Jones Soda espouses and practices Model II management techniques. Describing how the people at Jones come up with their ideas for products and promotions, he says, We’re way, way more collaborative than top-down management. We have a lot of brainstorming sessions, including people just sitting around having lunch or

110 whatever. Sometimes we’ll have board meetings, but really [idea generation] can be anything. In fact, no one remembers who first had the idea for the extremely successful MyJones program (where customers can design their own bottles for weddings, corporate events, etc.). Spear has heard that an employee, early in the brand’s development, asked why the photo labels couldn’t be run in smaller, customized batches; he has also heard that a customer contacted the firm to request special bottles for his daughter’s bat mitzvah. P2: The more collaborative an organization’s management structure is, (1) the more creative its market offerings will be and (2) the more successful its market offerings will be. Proposition 2 is supported by the literature (e.g., Cohen and Klepper 1996) and by current practice (e.g., crowdsourcing), and is not unique to lifestyle brands (e.g., Gloor 2006). Jones encourages open innovation by holding a once-a-month strategy conference call for everyone in the office, and the person who comes up with the best idea wins a monetary bonus. Jones’s recent switch to pure cane sugar is the result of one such session. Spear reports, “I’ve seen [brand founder] Peter bring anyone and everyone into the office to make decisions. Literally, the guy who’d been the receptionist here for 3 years [Jason Kim], was the one who pushed us into using cane sugar.” The same goes for Jones Independent Music. One of our RV drivers said in a conference call, “This is what I want to do,” and it seemed like a good idea. So they let him set it up and run it, but they weren’t ever really paying for it. He did the website and everything just because he wanted to and thought it was a good idea. It’s self-perpetuating – we don’t put a lot of money or resources into it at all, and it’s really big. The community that has grown up there is really what’s pushing it along, they’re uploading music and images. We’re not surprised, exactly, but we think it’s really cool that it’s the users that are keeping it interesting and fresh with hardly any input from us.

111 Furthermore, no one at Jones has total veto power over ideas; nor does anyone have complete green-light authority. Executive authority is shared among the most senior members of the organization. The firm solicits key feedback from its sales team members as well as from customers. Spear says, “The job to watch the chatter falls to everyone around here. It’s not scientific at all – just to get a general feel for people’s feelings about what we’re doing.” He also notes that the brand has made changes over the years, e.g., the switch to cane sugar, because of its ear-to-the-ground interest in consumer input and really understanding the zeitgeist. Of the three, Jittery Joe’s managerial structure the clearest example of a horizontal decision-making network (von Hippel 2007). The Bean Team exists because Micah Rice, who owns the team, is friends with Charlie Mustard, who owns the coffee roaster. Gene Dixon, an Athens race promoter and friend of both (but who has no formal connection to Jittery Joe’s), was the one who suggested that the team raise money by selling coffee as a fundraiser. “It was kind of by accident,” says Smith. The online presence of so many aspects of the brand (the official website, franchise websites, team blog, riders’ written and video diaries, fan pages, etc.) attests to the vibrancy of the myriad sources of support and inspiration for the brand. Some lifestyle brands’ marketing management tactics result from their lack of human and capital resources. In contrast, large firms generally have more centralized organizational structures than small firms do (e.g., Ronen and Shenkar 1985). Smith notes, No one in the organization ever officially Googles “Jittery Joe’s” to see what the chatter is. [Micah Rice actually does read online comments, unofficially.] I think they should. You don’t have any control over the forum, and you can go in and comment yourself, but we’re a small company. We only have so much time on our hands. You can only do so much about the comments that people are making. He goes on to say, “I think it’s more important to maximize exposure by keeping things local, grassroots.”

112 P3: The smaller the firm, the more likely it is to embrace Model II principles. This notion is not unique to lifestyle brands, as evidenced by the fact that Argyris and Schön developed their models of organizational behavior more than 30 years ago (1974), well before the notion of lifestyle branding existed. Furthermore, Covin and Slevin (1989) demonstrate empirically that across the board, small firms in hostile (i.e., intensely competitive, labile) environments tend to adopt “organic” managerial structures, with a free flow of information, shared decision-making, and little emphasis on formal hierarchies and procedures. Know thyself Despite their open, Model II orientations, lifestyle brand managers ultimately follow their own instincts in terms of product offerings and promotions. They do not believe that preliminary consumer research is necessary to identify market trends, although they are very interested in consumer feedback through official and unofficial channels of communication. Wogoman says, “We definitely take feedback from people, but in the end we do with we want to do. When we change something, it’s literally 3 guys in a room saying, ‘Yeah, okay, sure.’” Almost parroting that thought, Spear says, “You want consumers contribute as much as you can, but ultimately you have to make decisions because it’s your brand,” and Smith agrees: “Going with your gut is pretty much the way we go, and it might not always be the best decision, looking at ROI, but it’s working for us.” This process works for these brands because the managers are themselves heavy consumers of the products and services they offer. How managers’ own lifestyles affect their professional choices and brand performances is one of the most interesting questions for future research that comes out of this chapter. There is no one for whom self-brand identification (Sirgy 1982) is stronger than for these produsers (Bruns 2005). In all three cases, the managers

113 use their own experiences as consumers in order to inform their branding decisions. As Jeff Wogoman (Cloudveil) says, “We don’t do a lot of primary research. We are our customers, and we know what we want.” P4: The more closely a lifestyle brand’s managers’ own lives mirror their brands’ ideals, (1) the more confident they are in their decision-making and (2) the stronger the brand’s identity in the marketplace. Know thy customers In the conceptual model of strategic empathy in lifestyle branding, there is a construct labeled “attractive to customers,” which in the following propositions acts as both an independent and dependent variable. The goal of every market-based organization is to be attractive to customers; in the case of lifestyle branding, there are aspects of strategic empathy that are salient to generating consumer attraction. It is important to note that lifestyle brands are unattractive to some customers (e.g., Thompson et al. 2006). Lifestyle brands’ consumers can be segmented according to their commitment to the lifestyle itself. This is based on the idea of self-brand identification, and is critical for understanding the appeal of lifestyle brands. The symbolic interaction between consumers and these brands is a key component of successful p2p marketing. Consumers (i.e., produsers) both reflect and affect a brand’s meaning. If one were to imagine the strength of produser influence on a brand’s image as a stone dropped into water, at the center would be those people for whom the brand lifestyle is also their profession. These include the founders and employees of the firms, as well as individuals and members of organizations that they sponsor. In Cloudveil’s case, Wogoman elaborates on the brand’s central appeal: We’ve kinda changed the brand meaning a lot, and not changed it at all. At first we were “the backcountry purist company,” but we quickly realized that we’d have a short life. So we changed to “the innovative company,” and now “the

114 inspired company.” But the central message has always been that we’re Cloudveil, based in Jackson Hole, Wyoming, and our employees get out and do outdoor stuff. Cloudveil’s official Ambassadors are fishermen and -women, mountain climbers, and snowsports enthusiasts of all kinds; they are the public face of the brand. The same is true of Jittery Joe’s professional cycling team, and for the athletes, artists, musicians, and others associated with Jones Soda. P5: The more closely a lifestyle brand’s managers’ own lives mirror their brands’ ideals, (1) the better they understand their core customers and (2) the more attractive the brand is to its core customers. This proposition is a unique aspect of lifestyle branding, and one of the key findings of this research. Rather being tautological, the circularity of “the lifestyle brands’ managers’ lifestyles” highlights the fundamental essence of strategic empathy. This is the reason that when larger brands acquire successful smaller lifestyle brands, such as Nike’s buying Converse (Watson 2003), they usually do not advertise the merger, so as not to disturb the appearance of manager-consumer continuity. In contrast, the next four propositions (P6 – P9) are true of most brand types that position themselves as relationship-oriented (e.g., Guidry et al. 2008, Thompson et al. 2006, Bhattacharya and Sen 2003, Escalas and Bettman 2003). The next level of produsers for these brands are loyal, dedicated enthusiasts of the lifestyles, e.g., people who regularly post photos, music and comments Jones Soda’s websites. Though not officially affilated with the brands, these users are nonetheless valuable for helping create the brand’s meaning in the context of the greater culture they inhabit. Because of their affinity for the brand, these people, such as the Jittery Joe’s Patrons, are willing to invest a substantial amount of time, money, and effort into supporting the brand and promoting its message and its values.

115 Wogoman reports, “There are people who’ve requested a dealer workbook from us so they can shop before the new products are released. These are private customers who own more Cloudveil than I do. They love the brand, and I write them a letter every year, and we send them a thank-you gift.” With the market offering high-quality substitutions for the products these brands offer, consumers choose these brands because of their symbolic meanings as much as for their tangible qualities, affirming that symbolic interactionism (e.g., Blumer 1969) plays a large part in successful lifestyle branding. It is especially important to note the emphasis on the friendship between the brands and these dedicated consumers. P6: The more affinity a consumer has for the brand, (1) the more likely it is that he supports the brand’s values, (2) the more likely it is that he feels the brand helps him express his identity, (3) the more likely it is that the attraction is to the brand’s symbolic attributes and (4) the more likely it is that he considers the brand a friend. The next “wave” of lifestyle brand produsers are people who prefer the brand to others, but are not rabid loyalists. Micah Rice, of Jittery Joe’s cycling, observes of his brand’s trade dress, The flaming coffee cup is a really cool logo – it sells itself. It’s a very descriptive logo. On a lot of things, we won’t even put the words “Jittery Joe’s” on there. The logo is enough for people to recognize the brand. The company has done a great job making the logo and the name very descriptive, and very strong for customers. So we can really put the flaming coffee cup on just about anything – a mug, a hat, a pint glass, a hoodie – it can go on anything and it sells. These things do sell, and ~70% are to cycling people, and the others are bought at a coffee shop, or by people who went to UGA and are nostalgic about life in Athens. The diehards own more than one shirt. That’s why we keep changing the designs, because we know we’ve got these repeat buyers. He continues, discussing the brand’s impact in the cycling community: People outside the organization will say that Jittery Joe’s is one of the strongest brands in pro cycling. It’s a cool name, it’s caught people’s eyes for a long time, it’s recognizable, it’s a fun thing, and we’ve got a really strong fan base.

116 P7: The more a lifestyle brand reflects some aspect of consumers’ lifestyles, past or present, the more affinity they will have for the brand. P8: The more aesthetically appealing a lifestyle brand’s logo, the more affinity consumers will have for the brand. P9: The more unique a lifestyle brand’s logo, the more affinity consumers will have for the brand. There is an interesting conundrum in Jittery Joe’s merchandising, though, and we posit that the attitude behind it is present in consumers of all lifestyle brands. Smith and Rice report that their cycling jerseys, made by Canadian manufacturer Louis Garneau, “are one of the top selling jerseys on the market” nationally and internationally. At the 2004 Tour de France, Rice saw spectators wearing Jittery Joe’s jerseys although the team was not in competition. However, consumers in Athens do not buy or wear the cycling gear very much. Rice elaborates: You’ll definitely see t-shirts in Athens. But with the kits, local cyclists just don’t want to get… they feel like poseurs. It’s a modest direction to come at it – they don’t want to be confused with the team but they want to support the team. But tshirts, hats… anything that’s off the bike, people are very willing to wear all that stuff. P10: The more affinity consumers have for a lifestyle brand, (1) the more respect they have for its core produsers and (2) the more they try to emulate its core produsers. All produsers of lifestyle brands want to practice the values, activities, and beliefs that the brands and their role models represent. The reason that Athenian cyclists do not wear Jittery Joe’s kits is out of respect for the pro cyclists who are on the team, the brand’s core produsers. Cloudveil uses a market research firm called Cohorts to annually profile its customers. Its biggest consumer is “Jonathan,” who is 30-40 years old, male, urban, works out at gym, is single, owns an iPod, and has a huge disposable income. Wogoman says, “He’s a small percent of the U.S. population, but big proportion of Cloudveil file. The rich urban guys subsidize the people who really use our products in the way they’re designed to be used.” However, Cloudveil

117 continues to produce all items assuming that they will be used by the pro and hardcore produsers. They justify this decision not to segment their products, saying, “We’re more about lifestyle than demographic numbers. How much our customers make, gender, etc. isn’t as important.” The next segment, as the “wave” of lifestyle interest and influences decreases, are dabblers, i.e., those for whom the lifestyle is attractive but not a commitment. This group includes consumers who go camping or skiing one or two weekends per year, or who buy a Jittery Joe’s t-shirt during the Tour de Georgia, or who are interested enough to watch the X Games*, but not know who any of the athletes are. They know who the brands are, but not really the differences among competitors. These consumers have a higher probability of being responsive to specific p2p influences than the rest of the population. P11: The more interest a consumer has in a lifestyle, the more receptive he is to p2p communication about a lifestyle brand. Neither P11 nor P12 (below) is unique to lifestyle brands. Thanks to perceptual vigilance (Assael 1981), consumers who are interested in a style, an activity, a celebrity, etc., are more receptive to marketing communications that feature such associated brand identifiers. This interest might not make them brand loyalists, but it makes them more likely to notice and assess the brand, when given the opportunity to do so. We include these propositions because we want to examine consumer involvement in the espoused lifestyle, as both an independent variable (P11) and a dependent variable (P12). The final segment of consumers are interested only in the fashion statement that the brand makes. In this context, fashion has less to do with aesthetic appeal, and more to do with the brand’s current popularity among the general public. These trend-oriented consumers might

*

Jones Soda does not sponsor the X Games, although they share lifestyle and value orientations.

118 spend time and money on the brand, but are not interested in actually pursuing the lifestyle or the values it represents. For example, outdoor apparel has, in recent years, become trendy for people in their teens and early 20s. In a 2005 article in the Boston Globe, a 20 year old college student says of her expensive technical North Face face fleece jacket, “'If I ever did go camping, I wouldn't take it. I wouldn't want to ruin it” (Hurst 2005). The North Face, a highly respected mountaineering brand, has responded to this trend by offering two catalogs – one that features technical equipment and apparel, and another that is fashion-oriented. P12: The more fashionable a lifestyle brand is, (1) the less likely it is that consumers practice the lifestyle it facilitates and (2) the more successful its p2p communication will be. Lifestyle brands that have experienced this “fashionizing” phenomenon include Under Armour (technical sports wear), Quicksilver (surfing gear), and John Deere (farm equipment). In cases such as these, the brand experiences an explosion in demand, which fuels the growth of the firm. One potential downside of immense popularity is consumers’ perceiving the brand as “overexposed,” “out,” or “dated.” Laura Ashley (women’s clothing and home furnishings) is an example of a lifestyle brand that is a victim of the tides of fashion. While the brand claims the title of “America’s favorite lifestyle brand” on its website, it has been in steady decline since the early 1990s (Macalister 2005). With regards to Cloudveil’s attitude about its potential to become a trendy fashion brand, Wogoman says, We’re not just making pretty things – we’ve believed since day one that stuff can look good and perform at a world-class level. People who buy our stuff want people to think that they’re outdoorsy people. They do take their families camping. It’s not our intent to go beyond people who want to be in the outdoors. We don’t want to stray far from our core.

119 Jittery Joe’s coffee received international media attention when pop star Sheryl Crow “raved about the java” during an interview (Peters 2006), but the brand did not receive a noticable longterm boost because of the free publicity. Jones is grappling with newfound popularity – perhaps trendiess – and how this affects its core consumers’ perceptions of the brand. Spear comments, Diehard fans think our expansion into Wal-mart is a bit of a sellout, to be in the world’s biggest retailer. There’s probably a lot of people who were a little ticked, but that’s just how it is – cans are just part of the growth of the brand. People haven’t reacted negatively to the cans, exactly, but we’re going from people buying a single bottle out of a cooler, to people buying a 12-pack at the grocery. Staying true to their founding principles and values, regardless of size (a factor we discuss later), is crucial for lifestyle brands to remain strong and viable. This proposition is not unique to lifestyle brands; we can see it on a very large scale as well. Witness Wal-Mart’s ability to absorb bad news after bad news regarding its environmental, social, and labor practices. The core image of the brand is very low prices, which is what its consumers know and respond positively to (Guidry et al. 2008). Therefore, as long as it stays cheap, it will remain authentic. Similarly, Martha Stewart, who has spawned a domestically-oriented lifestyle brand bearing her name, actually gained popularity while in jail for insider trading, and sparked a small trend when she was released in March, 2005 wearing a handmade “Prison Poncho” (Melago 2005). P13: The stronger a lifestyle brand’s core identity, the better it can weather (1) short-term market trends and (2) negative publicity. Don’t grow too fast None of these brands is interested in dominating the market. Their little-guy status allows them to connect with consumers on a more personal level, even when using mass marketing techniques. Spear explains:

120 We’re small so we have to be clever about how we do things. I don’t know that anyone here wants to be at level of buying ad time during the Super Bowl – we want to be independent, and to be profitable. A lot of brands are trying to cram themselves down people’s throats and we’re not into doing that, because at Jones we’re consumers along with our customers. In fact, the Jones Soda slogan is “Run with the little guy… create some change.” This touches on a key aspect of lifstyle branding – smaller is better, at least at the outset, for several reasons. For each brand under consideration, the initial lack of resources forced its managers to examine what is really important to the firm, i.e., its governing values, and to be creative in coming up with ways, i.e., action strategies, to achieve its goals (Argyris and Schön 1974). Thus, these brands’ governing values have, by necessity, included organizational flexibility, collaborative problem-solving, and open communication – fundamental aspects of Model II firms that enable them to weather the growing pains that inevitably accompany success. Wogoman’s insight supports this notion: I don’t think anyone’s cracked the formula – how do you grow, and survive, and still have the same vibe you had on day 1? We didn’t have a clue going into this what it was gonna take to be successful. You have to change with the market. I think our adaptability is key to our success – if you come a fork in the road, you have to decide. But for us, we’re not embedded enough in the trendy culture to be negatively affected by the death of a fad. Jittery Joe’s beginnings – the teenage founder, the cycling team’s selling coffee out of the trunks of their cars at races, the networked organizational structure – also give credence to the idea that small budgets force brands to find more creative and long-lasting paths to success than if they had the money to spend in more traditional ways. Propositions 14 and 15, related to how small businesses operate most effectively, are borne out in popular managerial business thinking, and not just for lifestyle brands (e.g., Levinson 2007). P14: The fewer resources a lifestyle brand has, the more likely it is to pursue innovative marketing techniques.

121

Jones Soda’s entire brand concept is based on the smaller-is-better model. Abandoning this idea would destroy the most fundamental value of the firm. Although they have grown considerably (e.g., being the concessionaire for the Seattle Seahawks), they still cannot compete with Coca-Cola or Pepsi in terms of market share or advertising dollars. Spear says, “We’d love to make as much money as they do, but not to be as corporate as they are… definitely not.” Furthermore, Jones continues to allocate resources as efficiently as possible, weighing the financial and symbolic costs against potential outcomes. Spear says, We recognize that we have limited resources, and we have to be careful with them, and do what’s best for us. Our promotional strategy came out of poverty originally, but also because we knew we couldn’t beat the big guys at their own game. Anybody with enough money can pay to do the X Games, so that’s a venue that’s not that interesting for us. In addition, Jones will not agree to partner with firms that approach them, such as Johnson & Johnson, that they do not think are a good match, even if it means foregoing potential media exposure and increased sales (Spear interview). P15: The fewer resources a lifestyle brand has, the more efficiently it will allocate those resources. From the brand image aspect, there is another benefit to being small. Rice says of the Jittery Joe’s cycling team: We’ve managed to keep the underdog image even though we’ve got really strong riders. We don’t want to change that, because that appeal – the long shot – is really great, and it sells a lot of merch, more than if we were the expected winners. P16: The greater the disparities between the lifestyle brand and the market leaders, the more affinity consumers will have for the smaller brand.

122 This proposition is unique to lifestyle brands, due to the strong emotional and values connections that produsers feel towards their chosen firms. Consumers can feel sorry, or hopeful for their chosen brands. Underdog status can be a point of pride for people who choose certain lifestyles, especially if those lifestyles are out of the mainstream. This position is supported by the literature on consumers with a high need for uniqueness, who demonstrate less susceptibility to advertising and a stronger values orientation than their mainstream peers (Simonson and Nowlis 2000, Tian et al. 2001, Austin 2006). Although these three firms do not want to become mega-corporations, they are certainly interested in steady growth and increasing profits. All of them take the long view, that wellconsidered growth is the best way to ensure success. Wogoman explains that Cloudveil’s decision to expand into fly fishing was influenced the fact that they need high-margin products to sell in the spring, since warm weather clothes do not generate much cashflow. In examining their own warm-weather behavior, they realized that there is a market opportunity in fishing. (True to form, they have entered a field already dominated by big players such as Orvis and Cabela’s.) There are dangers in growing too quickly, as Jittery Joe’s is discovering. When they received the invitation to sell their coffee beans in Whole Foods Markets, they saw the need to proceed very carefully. Kirk Smith says, My one fear is that we’ve got so many things happening that we do a half-assed job at Whole Foods. They’ll notice it and say, “Thanks, but no thanks.” We want to make an impression, to tell the Jittery Joe’s story, and the Whole Foods demographic is exactly perfect for Jittery Joe’s coffee. There’s an opportunity there, but also a huge danger of blowing it. They currently sell beans in two Atlanta-area stores, but cannot not meet additional demand without doubling the size of the roaster. They are also extremely careful about franchising.

123 Jittery Joe’s should not “try to be Starbucks,” but rather be very selective about who gets to buy franchises, and where. In addition, the firm has no intention of going public; Smith thinks it would “ruin” the Jittery Joe’s environment. He acknowledges that “Every company wants to get bigger. But there’s a point where you’re making money without losing sight of what you should do.” P17: The smaller the lifestyle brand is, the more conservative the goals and growth strategies will be. This proposition is not unique to lifestyle brands, and is true across industries. Cohen and Klepper (1996) show that the size of a firm has a direct impact on its R&D expenditures: the bigger a firm is, the more it can spend on process and product innovations, which in turn lead to faster growth than smaller companies can plan for or achieve. Furthermore, Covin and Slevin (1989) empirically demonstrate that small firms in hostile environments place a heavy emphasis on long-term growth and investments. To thine own self be true For lifestyle brands, image is specifically linked to what mental associations consumers have for them. Losing authenticity would radically alter their own, and their consumers’ perceptions of their overall quality. This is true for many types of brands, not just lifestyle brands. Authenticity is integral to lifestyle brands’ functioning. The people who work for these firms are heavy-use, loyal customers who are simultaneously creating, promoting, and consuming the symbolic and tangible assets of the brands. A loss of authenticity would affect them personally. Furthermore, the construct of authenticity is one of the most interesting variables in our model of strategic empathy, because it has reciprocal relationships with so many of the other constructs. Propositions 18 – 23 relate to authenticity.

124 P18: The stronger a lifestyle brand’s authenticity, the stronger its (1) overall identity, (2) managers’ confidence and (3) symbolic appeal. One obvious signifier of authenticity is an emphasis on location. Cloudveil mentions Jackson Hole and the Teton Range at every opportunity. The name of the firm and most of its products come from local geologic features (e.g., Cloudveil Dome, Serendipity Arête, Koven Couloir, Cache Creek). Jittery Joe’s is strongly associated with Athens (“which has a vibe all its own”) and the University of Georgia. Jones Soda’s success is point of pride in Seattle. The Seahawks and Qwest sought out Jones for the stadium contract. They’d been dealing with Coke forever, and they were looking for more flexibility, to have more variety, and to be more responsive to their customers. I think people love it. They like Jones – we’re kind of a hometown thing. It’s been a cool way for us to connect the community and the fans (Spear). P19: The stronger the tie to place, the more authentic the lifestyle brand. Having a consistent, low-key brand personality is another essential element in establishing authenticity. Cloudveil is the guy at the pub after skiing who doesn’t say much, but you know he knows what he’s talking about. He’s friendly and helpful, but not a braggart, not standing on top of the mountain shouting how cool he is. People who talk the loudest and the most are the ones you don’t listen to. Here’s Jones’s take on the subject: We like unique. It’s the way that Jones was founded and distributed originally. One of our first markets was San Diego, and we’d literally have a truck that would pull up to a tattoo parlor or a skate shop and our guys would say, “Hey do you want to try our soda? We’ll set you up for free.” As far as event sponsorships go now, we try to be interesting and unique and in keeping with who we are, who we’ve always been. And Jittery Joe’s: Jittery Joe’s was the first coffee shop in Athens, and people didn’t know if it was going to be successful. They had good coffee and it was kind of funky, and people who came to school here loved it. When they move away they’re happy about still being able to get it at the new stores. It’s not seen as the Wal-Mart of coffee shops. There’s a trick to trying to grow and become the “it” place. We’re trying to keep

125 some of the retro feel, like the original logo. With our new labels we’re taking a southern folk art approach; they’re not slick and sophisticated. Rice agrees. “The early Jittery Joe’s stuff has a cool, punk, bar feel. They’ve kept their cool with the logo and the name, and the brand still works, and I think they’ve done a good job of keeping it up while becoming more mainstream.” P20: The more consistent a brand’s personality, the more authentic the lifestyle brand. Another aspect of authenticity is a firm’s association with people, organizations, and events. If the association is spontaneous and positive, it can be very effective for generating publicity. During his 2008 bid for the Democratic presidential nomination, Senator John Edwards held a community town hall meeting at the Clemson, South Carolina Jittery Joe’s that was covered in the national news. Smith says that visit was excellent exposure for the brand “whether you’re a Democrat or a Republican.” However, Jones Soda’s Mike Spear describes his uneasiness when there is an apparent mismatch between the firm and the event: We got a promotional opportunity at the San Jose Grand Prix – we were there and got TV time and a lot of exposure, but it was a lot more mainstream than what we’ve usually done. It was interesting because it was outside the realm of what we usually do. We don’t have a lot of data saying that it didn’t work. I just remember being there and thinking “Ehhh, I’m not sure what we’re doing here, or if we belong here.” Whether the brand is selling out (i.e., losing authenticity) is a judgment that the firm’s managers must make. Jeff Wogoman explains. We’re not really concerned with being perceived as trendy or too fashionconscious. I think once you establish yourself, you’ve made it harder for people to criticize you. The people who say “sellout” aren’t cool. If we say it’s cool, it’s cool. If you start to think that way – “we can’t come out with a baggier fit in interesting fabrics because that’s not ‘backcountry’” – you paint yourself into a corner.

126 Still, these firms take care not to tarnish the authenticity of their brand images, which is the biggest asset they have. All of them sponsor events, organizations, professional and amateur athletes, and performers, and are very careful in whom they choose to support. Wogoman says, We don’t have a huge budget to give away things to celebrities, though we’ve received those calls. But even if we had the money, I wouldn’t do it. You’re putting money into something that might give you a quick hit, but it won’t deliver any long-term attributes. But we are one of the main sponsors of the Jackson Hole Film Festival. We have other interests besides the outdoors. Similarly, Spear points out that while most of Jones’s sponsorships go to alt-sports athletes, they have also sponsored a spelling bee champion, a ballerina, and a cellist (among others) because they are unique and talented people. P21: The more consistent a brand’s associations, the more authentic the lifestyle brand. P22: The more consistent a brand’s attitudes, the more authentic the lifestyle brand. P23: The more consistent a brand’s actions, the more authentic the lifestyle brand. Do well by doing good For lifestyle brands, projecting a consistent, authentic brand message that promotes the shared values of the firm, its employees, and its consumers, is critical for maintaining positive relationships among these stakeholders. Values are the basis for people’s emotional connections with these brands, in that they feel like the brands are trustworthy friends. Spear says, “The Jones brand is already really established and cherished internally, and no one wants to mess around with it,” which is true of other lifestyle brands as well. P24: The more authentic a lifestyle brand’s espoused values, the greater the emotional connection with consumers. Corporate social responsibility actions support this notion. Sen and Bhattacharya (2001) propose the idea of “company-customer congruence,” and use social identity

127 theory (Tajfel and Turner 1985) to explain that “people are more likely to identify with an organization when they perceive its identity to be enduring, distinctive, and capable of enhancing their self-esteem” (Sen and Bhattacharya 2001: 228). Because the values of lifestyle firms are so deeply held, they become an invisible, or taken-for-granted, part of daily corporate operations. Established brands that suddenly trumpet their environmental friendliness are often accused of “greenwashing” their images (Schaefer and Crane 2005). Some firms clean up their manufacturing or labor practices to improve their images following negative publicity about their operations (e.g., Hemphill 1996). For lifestyle brands’ managers, consistently making decisions based on ethically-oriented belief systems is de facto organizational practice. At Cloudveil, Wogoman comments, “I’m not going to publicize the things we do, like solar power credits for the Jackson Hole office, because it’s not mission-critical for us.” All these firms make donations and sponsorships based on managers’ personal beliefs, although they certainly analyze the other aspects of these relationships before deciding yes or no. Jittery Joe’s Smith explains how embracing deeply-held values affects branding decisions and p2p communication: Sure, tying into an event is a brand building opportunity, but you have to find something that you truly, truly believe in. The firm’s benefit is secondary to your genuine interest and involvement in the success of the cause. Find something that has affected your life. Ben & Jerry’s is a great example, from day 1. They have a loyal following because they act on what they believe. “I believe in this cause, but I want to use my brand’s voice to build awareness.” As long as it’s done right, with belief, people will make an emotional connection and talk about it and share with each other.

128 This innate understanding of how value-oriented management affects customer relationships is supported in the literature. Ideological alignments, or social consensus, between consumers and producers is essential for creating successful marketing relationships (Deighton and Grayson 1995, Thompson and Coskuner-Balli 2007). Embrace, but don’t chase, peer-to-peer communication Having produser “agents” help create and promote a lifestyle brand’s image and message is more valuable to these firms than any paid advertising could be, and as such, p2p communication is one of the most important dependent variables in the conceptual model. Peerto-peer marketing is considerably cheaper, carries more emotional impact, and is perceived by stressed, jaded, busy, wary, or distracted consumers as being more trustworthy than traditional forms of marketing communication (Carl 2006, Austin et al. 2007). Furthermore, p2p communication has been the topic of much research and speculation in the marketing literature, These interviews provided an unexpected managerial perspective on how best to use p2p communication to help build a lifestyle brand. While all the managers understand and appreciate the role that consumers play in promoting their brands, none of them promotes much content for consumers to use to spread the word. These brand managers are very interested in fostering p2p communication about their brands, and are wary of alienating their customers by doing anything that could be seen as coercive. Wogoman says, The brand message we send, that we’re approachable and real – I think that helps facilitate those kids of [p2p] interactions. We don’t try to make anyone miniambassadors. I think that just who Cloudveil is really makes it happen. I think a lot of times with consumers, you get a bunch of marketers in a room, you’re going to kill that authenticity that’s so important.

129 Jones Soda does the most of the three brands in terms of creating content for consumers to use and share with each other in promoting the brand. Spear explains the philosophy behind their approach to promotions: “Cole and Weber [a Seattle-based ad agency] don’t shape or change the brand. They just create opportunities for consumers to enjoy it.” Kirk Smith describes Jittery Joe’s take on informal consumer-based promotions, reporting, [Legendary cycling commentator] Phil Liggett said, “Jittery Joe’s makes a mighty fine cup of coffee” on the air during the Tour de Georgia. How many people are paying attention, or going to buy the coffee – who knows? But you can’t buy that kind of publicity. Micah had given him the coffee to try because he’s a coffee drinker. Any time it becomes part of the conversation, or you see someone wearing our clothes, that’s what we’re going for. P25: The less emphasis on traditional marketing forms, the more appealing the lifestyle brand. Propositions 25 – 27 come from knowledge about consumers’ need for uniqueness, their skepticism regarding advertising, their sophisticated understanding of contemporary marketing techniques, and their desire for ethical consumption (Simonson and Nowlis 2000, Tian et al. 2001, Austin 2006, Austin et al. 2007). Even large, mainstream lifestyle brands (e.g., Harley-Davidson, Nike) attract consumers by offering friendship, trust, and unique promotional techniques make the relationship seem more intimate, and more fun. Thus, consumers feel more affinity towards these brands. (Proposition 26 addresses the consequences of violating this trust.) One downside of p2p communication is that firms do not have control over the brand or the message once it gets into the wider world; the brand is literally exposed (see Thompson et al. 2006). Smith, again: You’d like more people to be wearing your stuff, so you get more exposure. The more cyclists you have wearing the kit, the better. But you don’t want someone in the middle of the road having a road rage incident. Then Micah gets a call from someone thinking that a team member is acting bad.

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The other major drawback of a brand’s actively encouraging p2p communication is that it could jeopardize the trusting, friendly relationship that consumers have with the brand. Cloudveil seems to be the most cautious of the three in that regard. We purposely developed The Mountain Culture blog not to be like “Hey look how cool we are, we’re Cloudveil!” We intentionally tried to keep it low-key, and not use it as a mechanism for sales. I think that people are smart and they see through that stuff really quickly. When a p2p initiative is spontaneous and consumer-generated, though, the response can be extremely positive. Wogoman describes one example of this happening: We had a promotional code that had been distributed internally show up on the [filmmakers] Teton Gravity Research blog, and we thought we’d let it play for a while. We did about $30-40,000 of business in a few days, so it was like guerilla marketing that we didn’t have to generate. We pulled it down after a couple of days, but we had a great response, and we could watch people talking to each other online about the promo and the sales. It’s a fun game. P26: The greater the brand’s active encouragement of p2p marketing, the less appealing the lifestyle brand. P27: The greater a lifestyle brand’s reliance on p2p communication, (1) the more vulnerable it is to misinterpretation and (2) the more open it is to serendipity. Proposition 27 presents the biggest potential pitfall, and the biggest potential opportunity that lifestyle brands face in the marketplace. Any time there is a chance for p2p communication to occur, there is a chance that the brand’s message will not arrive in the same condition that it started, i.e., within the firm (e.g., Duncan and Moriarty 1998). As such, P27 is applicable to every brand in the world. In the cases in this chapter, these firms’ somewhat casual attitude towards p2p communication – essentially a “take it or leave it” stance – is precisely what attracts consumers to the brands in the first place. The representatives of all three firms repeatedly use

131 the word “cool” to describe their brands’ personas, and their feelings about how they should conduct business. In marketing, as in personal relationships, cool is the opposite of needy, and coolness is a desirable personality trait. Malcolm Gladwell defines the three “rules of cool.” The second rule says that cool cannot be manufactured, only observed, and the third says that it can only be observed by those who are themselves cool. And, of course, the first rule says that it cannot accurately be observed at all, because the act of discovering cool causes cool to take flight, so if you add all three together they describe a closed loop (Gladwell 1997, 88) Successful lifestyle brands intuitively understand this way of thinking and build their marketing strategies around this notion. By de-emphasizing their dependence on consumer participation, lifestyle brands can maintain consumers’ trust and minimize the impact of negative WOM. Wogoman says, “It might be egotistical, but I don’t think so, to say that if we think something’s cool, we’re going to make it and sell it.” These firms do not chase coolness – they know it is a futile effort, and one that makes firms look desperate and silly. DISCUSSION AND LIMITATIONS Zinkhan (2002) writes that true relationship marketing, in which the firm and the consumer form a close bond that persists over time, can be prohibitively expensive in terms of time and material resources. However, successful lifestyle brands rely on consumers’ wanting to build relationships with them, rather than vice versa. Consumers’ motivation to do so is that these firms are cool, and therefore attractive. Much like cool people, these firms don’t want or need to tell people how cool they are. In fact, all the managers we interviewed emphasize that they never claim to be cool in their marketing. They don’t deny their coolness – it is just a part of who they are and how they act, the decisions they make, the products they offer, the people they employ. Their actions prove their coolness and engender consumer trust in the brands.

132 Trust is important for any brand manager who wishes to develop successful p2p marketing techniques, even simply engendering conversation between two consumers. Consumers who do not trust a brand do not “buzz” about it, unless they are complaining, and losing consumers’ trust is more detrimental to a brand than never having it. Consumers who feel like a brand is coercing them, or using them, in order to promote its own agenda react negatively to both the brand and its promotions (e.g., Thompson et al. 2006, Austin et al. 2005, Zavestoski 2002). We discuss the potential pitfalls of p2p promotions with regards to consumer dissatisfaction and public policy concerns in detail in Chapter 3 of this dissertation. Managers must be careful not to alienate consumers by being too aggressive. Is imperative for managers to be cool, and to ensure that their brands, their products, and their promotions are trustworthy if they want to be successful in their p2p efforts. Strategic empathy is a very valuable asset for a lifestyle firm. Successful lifestyle brand managers are acutely aware of how consumers use brands, because they themselves are insightful and self-aware consumers in the postmodern marketplace. There is no disconnect between what these managers think, how they feel, and how they act in their personal and professional interpretations of the world. They are produser-ethnographers of the highest order, participant observers of the lifestyles and occupations they have chosen. Skillful lifestyle managers use their own experiences as consumers in order to inform their professional decisionmaking. This observation raises important questions: Just how essential are managers’ lifestyles to the success of the brand? Do managers have to live the life in order to make a successful lifestyle brand? Does the size of the firm make a difference (e.g., are Nike’s managers athletes)? Other pressing questions that this research raises are: How do brand authenticity and p2p communication affect each other? Recent work by Thompson et al. (2006) shows that consumer

133 use affects and reflects a brand’s meaning in ways that are useful for brand managers to examine. How strong an effect does a brand’s general popularity have on core consumers’ perceptions of the brand’s “selling out” or being “played out”? Proposition 12, related to fashion trends, proposes the only negative outcome in the conceptual model, and further testing will reveal if the popularity of a lifestyle brand has the +/- effect suggested in the model. In Zaltman et al.’s (1982) prescription for building a theory-in-use, the authors recommend challenging new propositions by examining them in light of ineffective practitioners of the phenomenon in question. Thus, the theory-builder can rule out, or subject to additional testing, those practices that do not converge, and those that call into question, facets of the model being developed. We do not examine unsuccessful attempts at lifestyle branding in this chapter, but realize how important it is to do so, and identify potential subjects for further study, including McDonald’s (for adults), MySpace, and Song airlines. In future research, we will examine these brands to see where and how their goals, strategies, and tactics are similar and different from successful lifestyle brands’. The major limitation of this chapter is that we do not test any of the 27 propositions. We will continue this research with experiments that test and measure these constructs, and their relationships with each other in the context of lifestyle branding. In addition, the exploration of the efficacy of lifestyle branding is not complete without a substantial amount of research on consumer attitudes and behaviors, which we only touch upon in this chapter when describing the role produsers play in the creation and dissemination of brand meanings. CONCLUSION Consumers respond positively to brands’ high quality, authenticity, consistency, and values by spontaneously bringing them up in conversation, making recommendations, seeking

134 out branded personal items, and otherwise engaging in brand-based p2p communication. While p2p communication works for lifestyle brands, we assert that it is due to an apparently unworried approach to such consumer relations, rather than an active p2p agenda put into play by brand managers. These findings are important in the cluttered, 21st century marketplace. Too many firms invest in p2p initiatives without understanding how, when, and why they work (or don’t work). This research provides insight about effective approaches to fostering p2p interactions, and points out mistakes that others might avoid when trying to create lifestyle brands. Successful lifestyle brands’ managers certainly value input from consumers and listen to what they have to say, but are not slavishly bound to the notion that the customer is always right. The analogy of interpersonal relationships is apt – friends who can disagree from time to time are much closer than friends who always try to avoid confrontation for fear of upsetting each other. Being secure in what they offer and how they offer it allows lifestyle brands’ managers to make confident decisions without dithering over their long-term impact on consumer perceptions. Strategic empathy translates managers’ attitudes, expectations, beliefs, and values as consumers into effective marketing strategies and tactics. The 5th and last chapter of the dissertation provides a summary of the preceding chapters. Key topics include theoretical implications, managerial implications, limitations and directions for future research.

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143 CHAPTER 5: CONCLUSION In this dissertation, we examine and synthesize a variety of source materials to enhance our understanding of contemporary branding techniques. Marketing managers know that building ongoing, trusting relationships with their customers is good business practice. Nonetheless, we are still learning the methods that are effective for implementing relationship marketing. This is especially true since new methods (e.g., p2p communications, e-commerce) are emerging that seem to have a lot of promise. The first objective of this dissertation is to provide a conceptual framework to explain how p2p promotions are part of an evolving marketplace. We accomplish this goal throughout the dissertation by systematically defining and organizing the key aspects of contemporary brand forms, of lifestyle brands in particular, and of p2p communication techniques. In Chapter 4, the conceptual map and the propositions serve to synthesize these efforts and provide a launching point for future research. Our next objective is to examine, test, and extend current consumer and managerial theories by investigating the underpinnings of p2p communication and lifestyle branding. We accomplish this by analyzing the relationships among consumers, managers, brand images, contextual influences, and official and unofficial brand-based communications. This is a highly complex system that merits closer investigation of each set of relationships. In order to do so, we study existing branding techniques to develop and conceptually test 27 propositions related to lifestyle branding and a managerial theory-in-use we call “strategic empathy.” Our third objective is to identify potential problems and opportunities associated with promoting lifestyle brands, from multiple standpoints. By drawing on academic, managerial, and popular publications on branding and consumer behavior, and by collecting primary data on

144 lifestyle brand management, we are able to identify areas where problems with consumer-based branding and communication have appeared. Chapter 3, in particular, acknowledges consumer and public policy issues that are potential sticking points for p2p marketing. Areas of concern include targeting children, invasion of privacy, commodification of private and noncommercial spaces, and the potential to disrupt cultural systems (e.g., through vote-swapping). Chapter 4 addresses managerial stumbling blocks, especially the notion that creating and maintaining trust is critical for successful lifestyle brand management, and by extension, p2p marketing. In our holistic survey, we identify six essential tenets for successful lifestyle brand management. When carefully managed, lifestyle branding presents small firms the opportunity to create strong market identities, to cultivate long-term customer relationships, to grow sustainably, and to leverage consumer loyalty. THEORETICAL IMPLICATIONS The theoretical implications of this dissertation are related to consumers’ and managers’ perceptions of the relationships among themselves, each other, and the brands that they choose to support. As such, we extend the consumer culture theory literature presented by Arnould and Thompson (2005). In this research, we examine the congitive and emotional mechanisms that underlie lifestyle branding and p2p communication efforts. The theoretical underpinnings of this research relate to the interfaces between the self and society, and these theories inform and reinforce one another. Specifically, we examine lifestyle branding and p2p communication in light of self-brand identification (Sirgy 1982) and symbolic interactionism (Blumer 1969, Solomon 1983). We also seek support in related ideas, including social identity theory (Tajfel and Turner 1979) and postmodern self creation (e.g., Bourdieu 1984). We find that lifestyle branding supports the

145 theory of self-brand identification. Congruence between self-perception and the perception of the brand is essential for successful lifestyle branding. Lifestyle brands’ emphasis on values, authenticity, and preferred ways of living attracts consumers who share the same priorities. Even consumers who are only marginally interested in the lifestyles these brands espouse find themselves attracted to the images these brands project. Consumer participation in p2p marketing confirms symbolic interactionism. In wanting to possess and project the same images, values, and authenticity as certain brands, consumers voluntarily engage in brand-based p2p exchanges. Strong brands leverage p2p communication through consumers’ desire to signal (to each other) that they believe in the brands’ symbolic power. A fundamental theoretical assumption in this dissertation is that there is not a clear boundary between producers and consumers (e.g., Peñaloza and Venkatesh 2006). Lifestyle brands blur the distinction to such an extent that we consider both groups as part of a single entity known as produsers (Bruns 2005). We find that successful lifestyle brands take produser effects into account in key areas of the marketing function such as product design, distribution methods, and promotional techniques. Another noteworthy theoretical finding of this research is that in general, lifestyle brand management seems to support and enact Model II organizational principles (Argyris 1982). Model II management relies on free exchange of ideas from multiple sources, open communication, and responsiveness to problems as they arise. We find that these same principles are essential for lifestyle brand management. The final theoretical contribution of this dissertation is a new theory of branding that is related to, yet distinct from previous theories. We call this new theory “strategic empathy.”

146 Strategic empathy translates brand managers’ attitudes, expectations, beliefs, and values as consumers into effective marketing strategies and tactics. Strategic empathy drives successful consumer-based marketing initiatives. MANAGERIAL IMPLICATIONS Being able to harness peer-to-peer brand communication as a marketing resource has an enormous amount of intuitive appeal and some ecological validity, but there are two looming managerial questions that arise when thinking about developing p2p techniques. (1) How can brand managers encourage consumers to engage in positive brand-based communication? (2) How effective is p2p communication for spurring a purchase by the message’s receiver? Marketing academics and practitioners, in examining competitive advantage, have focused on peer-to-peer branded communication because of its utility and ubiquity in modern consumer culture. In this dissertation, we have isolated and defined the relevant attributes of p2p marketing techniques, and find that it is a critical aspect of lifestyle branding. Furthermore, we believe that consumers are more likely to communicate with each other about lifestyle brands than non-lifestyle brands. This is not to say that they only talk about lifestyle brands, but that the chances are greater. We also find that firms that allow consumers to decide, without much encouragement from the firm, whether to talk about their brands, are actually quite successful in generating p2p exchanges. We do not know if these brands are more or less successful than other firms that aggressively pursue p2p communication, but our feeling is that a hands-off approach is more effective than one might suppose. This is a revelation for managers who spend time and money trying to find a p2p technique that “works.” Do p2p techniques work at all? Consumers’ long-term attitudes might not be influenced by day-to-day brand-mediated interactions. The classification scheme presented in Chapter 3

147 provides a resource for managers who wish to examine their own p2p efforts. Brands that seek guidance on their promotional options can use Table 3.1 to analyze the elements of p2p branding. This table is valuable for developing instruments that can measure the effectiveness of p2p techniques and the relative importance of their constituent elements. We find that consumer perceptions of a brand’s trustworthiness and authenticity are critical elements for successful lifestyle branding. The same is true, to a lesser extent, of p2p marketing. Consumers can be persuaded to promote corporate messages with incentives, such as contests or discounts, but involvement and commitment to the brand/firm/product cannot be bought. Lifestyle brands lends themselves especially well to p2p techniques because they are generally smaller and seem like they need help (the underdog effect), they seem more authentic to customers, they carry a value-based message that resonates with consumers, and they seem like their consumers’ friends. All these elements encourage consumers to develop long-term relationships with these brands, and to “introduce” them to their other friends. Finally, this dissertation offers managers extensive information related to building successful lifestyle brands. We find that a lifestyle brand’s concept and image rely heavily on managerial decisions made at its inception or soon afterwards. These brands are differentiated from their non-lifestyle competitors through their commitment to a single, well-defined way of living, their values orientations, and their management style. Understanding that these are critical elements of lifestyle branding that cannot simply be pasted on top of a preexisting nonlifestyle brand will help managers who are truly interested in changing their public images. Managers can effect change, but we doubt that they can turn a non-lifestyle brand into a lifestyle brand without making fundamental changes to the brand’s structure and orientation.

148 LIMITATIONS First, this research focuses on consumer-based marketing methods that are ubiquitous in 21st century Western markets. Second, it uncovers the higher-order characteristics on which these methods are based, thus identifying the groundwork, or “contents,” of peer-to-peer promotional techniques and lifestyle branding. Finally, it develops a conceptual model and propositions that help explain the complex interactions and relationships among these various elements. The points raised in the previous paragraph suggest some important limitations. The most obvious is the lack of measurement metrics in any of our studies. We realize that this is always a problem for conceptual research, and acknowledge that our arguments will be strengthened by future projects with well-designed experiments and robust empirical evidence. We must test each of our 27 propositions, and challenge our structural model. At this point, we can conjecture, but we do not know the relative importance of each elementsof lifestyle branding. Nor do we know what aspects are most salient for creating and promoting successful p2p marketing techniques. In addition, the exploration of these topics is not complete without a substantial amount of research on consumer attitudes and behaviors, which we only touch upon when describing the role produsers play in the creation and dissemination of brand meanings. The topics we study in this dissertation are multifaceted higher-order concepts that depend on consumers to be successful. While we have put forth ideas about how consumers behave in the relationship scenarios we describe in this dissertation, we must prove or disprove these by gathering and analyzing consumer data.

149 Furthermore, we do not examine unsuccessful attempts at lifestyle branding in this dissertation, but realize how important it is to do so, and have identified several potential subjects for further study, including McDonald’s (for adults), MySpace, and Song airlines. We cannot prove that we understand what makes lifestyle brands successful without challenging our findings with other brands that we have not previously examined. Similarly, we must examine our propositions with regards to very large, successful lifestyle brands, such as Nike. Our tenets of successful lifestyle brand management are based on relatively small firms’ experiences. We posit that the size of the firm and its managerial structure have major influence on the effectiveness of lifestyle branding. This observation leads to another major limitation, which is the fact that we do not know how effective these marketing forms are, as far as returns on financial investments are concerned, nor relative to other contemporary marketing methods. It is important to study lifestyle branding, p2p communication, and how they are related to each other, because they both have a significant amount of currency in the modern relationship-marketing paradigm. However, this dissertation leaves important questions unanswered: Do they work? Are they better than other marketing forms and techniques? KEY LEARNING The general categories of relationship marketing and emotional branding continue to evolve and present exciting research opportunities. Our emerging understanding of lifestyle branding may be especially useful in the highly fragmented consumer marketplace. In Chapter 3, we present several examples of how consumers use emerging communication technology and individual preferences to distance themselves from mainstream, one-size-fits-all marketing. The result is smaller, more precisely defined micro-segments of the population that are not bound by

150 geographic limitations. These groups of consumers do not necessarily have anything in common with each other besides a preference for a product, or a brand, or a specific attribute; individuals’ alliances can shift with every market decision they make. Once we began examining p2p communication techniques as a marketing phenomenon, we were surprised at their variety, complexity, and ubiquity, and by the sophisticated psychological and social principles on which they are based. Our work on p2p led us to examine the foremost users of p2p techniques, lifestyle brands. Lifestyle branding tries to avoid consumer resistance to marketing efforts by acknowledging that the most valuable consumer participation in p2p communications is entirely voluntary, and by not expecting all consumers to be enamored of the particular lifestyles that they offer. Understanding that consumers like to be in control of their choices – what, when and how they consume, and to whom, how and why they tell others about their consumption – gives lifestyle brand managers a distinct advantage in planning and executing effective strategies. In this dissertation, we show that while non-lifestyle brands can recruit consumers to carry their messages for them, the incidence is higher among lifestyle brands. In addition, we find that lifestyle brands are much more likely to be successful in their p2p efforts than non-lifestyle brands are, due to the overlapping domains of lifestyle branding and p2p communication (i.e., the concept of the produser). However, we also find that more brands exhibit lifestyle characteristics than we expected to find, which bodes well for those brands that are interested in using p2p methods. On one hand, consumers want customized products tied to their individual preferences (e.g., iPod playlists). On the other hand, they crave market-based affiliations, and want to feel like knowledgeable, valued members of a group, even if that group is comprised simply of others

151 who prefer some of the same brands. In Chapter 2 we find that the flourishing of a variety of personalized, relationship-oriented approaches to marketing helps to support and extend the thinking that produser-type relationships are an effective contemporary marketing paradigm. In Chapter 4, we provide empirical evidence that shows that value-oriented, market-based relationships can appeal to consumers’ emotions, help them meet their social needs, and generate long-term loyalty. Figure 5.1 is a basic model of the relationship between lifestyle branding and p2p communication.

Differentiation

Values orientation

Lifestyle brand

Peer-to-peer communication

Authenticity

Figure 5.1: The relationship between lifestyle branding and p2p communication

FUTURE RESEARCH: QUESTIONS AND DESIGNS In this dissertation, we focus on lifestyle brands and various forms of p2p communications. We identify the domains that lifestyle brands and p2p communication occupy – where they are distinct and where they overlap – with a nascent understanding of how each affects the other. Based on qualitative empirical evidence, we construct a conceptual model and develop 27 propositions that explain these relationships. The next major step in our research

152 agenda is to assemble and analyze more precisely focused empirical evidence that begins to test the concepts we put forth in this dissertation. We need to examine lifestyle branding and p2p communication from the consumer’s point of view. When and why do they voluntarily participate in p2p campaigns? We propose that the best way to answer this question is through multiple, dovetailing methods of research. Initially, we will conduct qualitative research, interviewing consumers individually and in small groups, in order to understand what they think, how they feel, and how they act with regards to the lifestyle brands they consume (and avoid), and how they engage in p2p communication, both as Consumer 1 (i.e., message sender), and Consumer 2 (i.e., message receiver). We are most interested in the following four interview domains: What draws you to, or drives you away from, particular lifestyle brands? How conscious are you of your reactions to p2p communications? How much impact do you think you have on brands’ images? How big a role does context play in your evaluation of a brand? We are especially interested in the opinions and actions of consumer rebels – those people who resist and refuse to promulgate p2p brand messages, or even go so far as to create their own p2p anti-branding techniques to combat the perceived commercialization and commodification of their own lives. Other research has shown that consumers sometimes appreciate the more personal approach that consumer-based methods seem to offer, while at other times, they rebel against the commodification of formerly private spaces (e.g., Kozinets 2002, Rumbo 2002). There has been one scale published that specifically measures anticommercial consumer resistance (e.g., Austin et al. 2005), but we suspect that there might be relatively more resistance to non-lifestyle p2p campaigns, and less resistance to lifestyle brands’ p2p efforts, especially for those lifestyle brands that manage to appeal to consumer rebels’

153 personal aesthetic and value systems. We propose including resistant consumers with more accepting consumers in focus group interviews, in order to observe the interactions between those who are bothered and those who aren’t. Thus, we will discover where there are intersections and divergences in the opinions of these individuals; we suspect that each group influences the other more than anyone realizes. In addition, we would like to interview resistant consumers individually, in order to plumb the reasons behind their suspicious/cynical market views. Consumers’ responsiveness and/or resistance to p2p techniques, both as senders and receivers, is a unique phenomenon that has yet to be measured in the marketing literature. Using extant knowledge of symbolic consumer language, we can begin to synthesize when, how, where, and why people make the determinations and judgments of themselves and others, based on the dynamics among consumers, contexts, and methods of p2p communication. We will compile this theoretical, conceptual and anecdotal knowledge as a base, from which we can identify common themes and conceptualize the specific dimensions of affinity and aversion to p2p communication. We will use this information, plus the findings from our qualitative analyses to generate a battery of questions, as well as to analyze our data later in the process. After collecting survey data, we will undertake exploratory work in the form of principal components analysis on one dataset, then perform a confirmatory factor analysis using a second unique dataset to validate the findings obtained in our exploratory work. We can then compare these findings with consumer attributes already measured by other scales, e.g., the Revised Self Monitoring Scale (Lennox and Wolfe 1984), Consumer Susceptibility to Interpersonal Influence (Bearden, Netemeyer, and Teel 1989), and the Measure of Materialistic Attitudes (Moschis and Churchill 1978). In identifying consumer behavior factors that are positively and negatively

154 correlated with voluntary engagement with brand-based p2p communication techniques, we will extend theory related to symbolic interaction and the self-brand connection, as well as providing managers with a means to evaluate the potential for success in their own promotional efforts. We argue for the additional need to test this factor model on specific populations, e.g., young children and teens, as we suspect that certain groups might be more susceptible to p2p influences than others. There is exciting future work to be done on the “produser” interface – the blurry line between those who are producing and those who are consuming the symbolic meanings that are the essence of all brands. Our notion of the relationships among managerial inputs, authenticity, consumer affinity, and multi-polar brand communication leads to these research questions: How do consumer-based marketing methods influence the relationship between consumers and corporations? Is there a difference in how consumers respond to lifestyle and non-lifestyle p2p efforts? How important are managers’ lifestyles in persuading consumers to participate in brandbased p2p communication? Do managers have to live the lives they espouse in order to build successful lifestyle brands? Does the size of the firm make a difference (e.g., are Nike’s managers athletes)? We can answer these questions using a series of experiments, and can explore and extend the propositions related to the one-way and reciprocal influences that firms and consumers exert on each other in the creation of brand meanings. For example, to answer the question, “How do consumer-based marketing methods influence the relationship between consumers and corporations?” we propose an experimental design in which we first ask research subjects (consumers) to read material and examine or sample products provided by a named firm (e.g., clothing, food). Then, in one group, we ask subjects to write a letter to a friend or relative, specifically related to the firm. For another group

155 of subjects, we ask them to write a letter talking about their day (without additional prompting about the experimental situation). In the control group, we ask them to complete an unrelated task. Next, we have all three groups engage in a distraction task. Finally, we administer a survey in which we ask about their opinion of the quality of the products, their feelings about the brand and the firm overall, and their feelings about the task they were required to complete. One set of dependent variables in this experiment are whether members of the second group mention the experiment in their letters (1/0); if so, whether they mention the brand/firm in particular (1/0); if so, whether their affect towards the product/brand/firm is positive, neutral, or negative (2/1/0). Another set of dependent variables comes out of the survey data. Our survey will contain Likert-type questions, with answer choices measuring favorable-unfavorable, positive-negative, like-dislike, and will buy-will not buy attitudes. We examine all three groups to measure consumers’ reactions to the product and brand, relative to the communication task they performed. We will also measure their reactions to the task itself. We expect that differences will emerge among the groups, depending on what they were asked to do; what we suspect is that some consumers will feel more positive about the firm after writing the letter, while others will feel as though they have been used, resulting in negative affect and worse opinions about the firm, the product, and the letter-writing task. Thus, we will achieve a basic understanding of how p2p techniques affect the consumer-brand relationship. We can adjust this basic experimental design. For example, by adding brand type (lifestyle v. non-lifestyle brand) as an additional independent variable in the first step, we can discern the difference between consumer reactions to p2p with regards to different brand types. Along similar lines, we are interested in taking a closer look at how the interaction of managerial concepts, consumers, message contents, and consumption contexts affect a changing

156 brand image, under conditions when that change is intentional and/or desired by the brand managers, as well as when it is spontaneous and/or detrimental to the prevailing image of the brand. Which of these elements has the most influence on brand image? Does it depend on the circumstances? Again, we can use experiments to answer these questions. For example, we can measure contextual effects by photographing a known brand in conspicuous use in three different situations (positive, neutral, and negative – to be verified in pretesting). We will first ask respondents their opinions about a list of well-known brands that includes the brand in the photographs. We will then show them a small series of photos, which will include one of the three photos of the brand. Finally, we will administer a second survey, in which we measure how they feel about the brand. We can examine whether contextual effects appear after a brief, simulated p2p exposure by measuring the change in affect between their initial and follow-up surveys. In this experiment, the dependent variable is not the final opinion, but the magnitude and direction of change. We can extend our results by asking about the brand again after a period of time, say, the next day, to see if any change in opinion that they might have felt is persistent or transient. Thus we can begin to measure how contextual and malleable the symbolic meanings of brands are. Of particular managerial importance is the pressing question: What is the relative effectiveness of various consumer-based marketing techniques? How do consumer responses vary across the methods? How do p2p methods compare to more traditional forms of promotion? We can answer these questions with experiments that include “affinity for the brand” as their dependent variable. We identify customer affinity as a key aspect of the conceptual model in Figure 4.1, with many independent variables potentially contributing to its overall outcome. Among these inputs are brand managers’ lifestyles, a brand’s professed values,

157 the symbolic meaning of the brand, and p2p communication. This last element is important because we propose in our model that there is a reciprocal effect between affinity and p2p participation. Other pressing questions that this research raises are: How do brand authenticity and p2p communication affect each other? Recent work by Thompson et al. (2006) shows that consumer use affects and reflects a brand’s meaning in ways that are useful for brand managers to examine. How strong an effect does a brand’s general popularity have on core consumers’ perceptions of the brand’s “selling out” or being “played out”? Proposition 12, related to fashion trends, proposes the only negative outcome in the conceptual model, and further testing will reveal if the popularity of a lifestyle brand has the +/- effect suggested in the model. These questions represent the beginning of a fruitful line of inquiry into a new marketing paradigm – the socially constructed market (Peñaloza and Venkatesh 2006). This dissertation outlines two major social marketing phenomena, lifestyle branding and p2p marketing. We present conceptual frameworks for each of these approaches and demonstrate how they work in tandem to leverage the power of consumer communications. In addition, the notion of the produser as a key player in the market gains traction in this research, and offers exciting possibilities for the future of marketing. Finally, strategic empathy promises to be a powerful theoretical approach to marketing management, as it considers the complex interactions among the evolving elements of the new paradigm.

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