September 13, 2005
Brand New Placement
Posted by Victor Fleischer

Last week I frantically incorporated the first round of comments on my branding paper into a revised draft, which I uploaded to SSRN and then submitted in a rifleshot fashion, as if it were a limited edition work.  (It's a paper about branding, after all.)  And I am so happy that I did -- the Michigan Law Review accepted the piece yesterday.   

I'm not sure it's wise to start a trend of blogging the star-footnote, but I can't resist saying a public thank you in particular to Josh Wright, Todd Zywicki, Peter Oh and Larry Ribstein, whose timely comments over the last two weeks helped me turn a lump of coal into, well, it's hardly a diamond, but it's at least cubic zirconia.

Blogging helped the process in more ways than one.  More on this below the fold.

First of all, posting half-baked ideas on the blog made the first draft a bit easier to write.  (Tho it is never easy, is it.)  Second, feedback on those ideas helped me anticipate some objections.  Third, other blogs became a primary source material as I considered how deal structure affects the public perception of Google and Apple in particular.  Lastly -- and rather unexpectedly -- blogs have made me more aware of how opinions about consumer products form, and have even become a small part of my argument in the paper. 

I pin a fair amount of weight on the notion that deal structure affects the atmospherics of the brand.  The Google IPO makes Google seem more fun, innovative and egalitarian.  Steve Jobs's salary of a dollar makes Apple seem contrarian, more devoted to its users -- an anti-Microsoft.  But how do these messages get communicated?  What exactly is the process that forms the atmospherics of the brand?  How does buzz get created?  Can deal structure really create buzz? 

The business press is part of the story, but blogs might be too.  Of all the consumers who use Google or Apple, who is most likely to know about deal structure?  Nerds. (Or, as Malcolm Gladwell calls them in Tipping Point, Mavens.)   And some of these Mavens/nerds/early adopters blog.  Just for the sheer delight of it.  Sometimes at two in the morning.  And they read each others' blogs. 

And when normal people try to decide which product to use, who do they ask?  Nerds.  Think about why you started using Google Search, or Google Maps, or why you bought a Mac.  (Or, outside of the technology context, why you bought a Big Bertha driver or started shopping at Whole Foods.)  Chances are good that it was word-of-mouth, not traditional advertising, that made the difference. If deal structure changes the opinions of Mavens, then it's much more likely to have a branding effect.  It's not that the Mavens tell others about the deal structure, but rather that the Mavens themselves may think differently about the company.  Unusual deal structures may allow companies to post a reputational bond with Mavens, or simply draw attention to the company. 

The nice thing about focusing on the process of buzz creation is it helps me understand why deal structure would not be an effective branding mechanism in other circumstances, i.e. with companies that sell products where people don't rely on Mavens for advice. 

In the end, this is really more of a story about specialized opinion-makers than it is about blogs.  Blogs didn't have anything to do with Ben & Jerry's or Stanley Works or the other pre-blog-era deals.  The expert opinions there were shaped by the likes of Calvin Trillin, writing in the New Yorker (Ben & Jerry's) and political activists (Stanley Works).  But I'm not sure I would have found this promising piece of the puzzle without blogs. 

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» Madison on Branding from Conglomerate ...
"I'm an IP guy, so I took a look at Vic Fleischer's Branding paper and discovered a very cool piece ..." [more] (Tracked on September 14, 2005 @ 18:57)
» Google's brand new deal? from Ideoblog ...
"Vic Fleischer recently announced the law review placement of his new article on use of deal structur ..." [more] (Tracked on September 16, 2005 @ 6:36)
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