Archive for December, 2010

UBS: Attire and Branding

December 17, 2010

The Wall Street Journal reported this week that financial giant UBS is out with a new dress code for its Swiss employees.  You can read the article here:

http://online.wsj.com/article/SB10001424052748704694004576019783931381042.html

The UBS code is rather impressive; it is 44 pages long and includes lots of advice on dress and person hygiene.  It document reviews how to tie a tie and explains how to care for underwear.  It also provides direction on perfume and shaving.

You can read the entire dress code here (it is in French):

http://www.letemps.ch/rw/Le_Temps/Quotidien/2010/12/09/Culture%20&%20Societe/ImagesWeb/Dresscode_F.pdf

Is this appropriate?

Absolutely.

Appearance is always important, because whether we like it or not people draw conclusions based on attire and looks. 

For an investment firm, appearance is particularly important.  The difficult thing about selling investment management is that the benefit is ambiguous.  Customers don’t buy something tangible, like a pizza or a car.  They buy something intangible, the hope that the investment firm will do a good job and won’t make off with the money.  As a result, building a strong brand is essential; an investment firm like UBS has to create a brand associated with integrity and sobriety and intelligence.

Perhaps the most important factor in building the brand of an investment firm is the team.  And the way the people look communicates a lot.

One could argue that people should know how to dress; you don’t need to spell it all out.  But as new people enter the firm it isn’t a given that they will quickly understand the expectations.

Being clear on appearance expectations is a good practice.  This is true for people working at McDonald’s and for people working at UBS.

Starbucks and Seattle’s Best

December 3, 2010

This week Seattle’s Best coffee has been in the news; the brand is rolling out a new simplified packaging system.  Seattle’s Best is adopting a new level system, featuring different coffee blends at different amounts of intensity.

The move is all part of an effort to reinvigorate the Seattle’s Best brand and, perhaps more importantly, strengthen the Starbucks brand portfolio.

For many years, Starbucks and Seattle’s Best had a rather awkward relationship.  Starbucks acquired Seattle’s Best about seven years ago and after the acquisition it was clear that Starbucks was the company’s primary premium brand while Seattle’s Best was a somewhat neglected second premium brand.

The latest moves give Seattle’s Best a clear place to play in the market and in the Starbucks brand portfolio.  Starbucks continues to be the company’s premium brand.  Seattle’s Best is now the company’s mid-tier brand, playing in a very different segment of the coffee market.

The differences are significant.  Starbucks will price at a premium, while Seattle’s Best will price significantly lower, half-way between mainstream brands like Folgers and high-end brands like Starbucks and Peet’s.  Starbucks will have a broad product assortment, with coffees from different parts of the world.  Seattle’s Best will have a narrow product assortment, with a simple set of coffee blends, ranging from strong (5) to mild (1).  Starbucks will discuss the nuances of coffee while Seattle’s Best keeps things simple.

Overall this move makes perfect sense.  Each brand now has a distinct place to play.  More importantly, the company can go after a much broader set of customers.  With just one premium brand, Starbucks was limited in terms of where it could play.  Now the company can fight for a much bigger share of the overall coffee market.

Still, the Seattle’s Best relaunch won’t be easy.  Coffee is incredibly competitive so it will be difficult to break through the clutter.  And the middle ground is sometimes a very difficult place to live.  Seattle’s Best provides a relatively premium coffee at a relatively low price.  The risk is that consumers looking for low prices will head for the mass coffees, while consumers looking for premium coffees will go for the high-end brands, leaving nothing in the middle for Seattle’s Best. 

So it won’t be an easy win.  But the move certainly makes a lot of sense and if Starbucks is willing to invest in Seattle’s Best it could be a very big growth platform for the company.


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