“First win the eye, then the heart, then the mind,” believes design firm Lewis Moberly, which works on Diageo plc (ADR) (NYSE:DEO) -branded beverage Bailey’s. Diageo plc (ADR) (NYSE:DEO) management spoke eloquently on good design as crucial innovation on their first innovation webcast.
Consumer goods rely on attractive packaging to induce customers to buy before all others. Diageo plc (ADR) (NYSE:DEO)’s marketing director explained, “Ogilvy executive creative director Rory Sutherland concludes… most of our decisions about brands are emotion based – there are too many of them, coming too fast for our logic centre to process, so we rely on the visual.”
Attention to design has led The Coca-Cola Company (NYSE:KO) to the number one rank in the Interbrands annual 100 Best Global Brands followed by Apple Inc. (NASDAQ:AAPL) at number two for 2012. Apple Inc. (NASDAQ:AAPL) achieves the number one rank on BrandZ’s 2013 top 100 global brands with The Coca-Cola Company (NYSE:KO) trailing number four McDonald’s Corporation (NYSE:MCD).
The Old Masters of packaging and advertising
Peter Walshe, Brand Z creative director, said of Apple Inc. (NASDAQ:AAPL), “Its brand value only increased by 1 per cent this year but it still holds the record for the most valuable brand. And it leads by a long way. The next brand in the ranking, Google, is worth $113.7bn … so Apple is $71.4bn ahead – nearly the value of The Coca-Cola Company (NYSE:KO), which just shows how strong, powerful and meaningful that brand is.”
Such strong brand performance often belongs to companies that elevate design to an art. Steve Jobs audited a college class in calligraphy and its design discipline helped him craft products in which form follows function beautifully from their logo to the curved edges and brushed steel of Apple devices. The Apple Inc. (NASDAQ:AAPL) stores are architecturally elegant yet navigable. That’s part of the reason why Apple stores make the most money per square foot of any retailer. Hiring design genius Jony Ive hasn’t hurt either.
The history of their advertising also encompasses a design trajectory from the straightforward ads of the 1970’s to slightly more attractive ones in the ’80s (one features a young Bill Gates shilling Apple Inc. (NASDAQ:AAPL) and another a slim Steve Wozniak) to the increasingly more visually and conceptually sophisticated ones of the 1990’s featuring the “Think Different” campaign. One can also see the evolution of product design paralleling an increasing design sensibility.
But what makes Apple Inc. (NASDAQ:AAPL) stand out as an Old Master is that function was never sacrificed to form. Products had to work beautifully and better than the competition.
Now that Jobs is gone comes the most challenging era in Apple’s history. Just as Apple seemed to wander aimlessly in the desert after the time he was ousted until he came back analysts and investors worry over the pipeline and loss of Jobs’ vision.
The Coca-Cola Company (NYSE:KO) has a design heritage second to no one. From famous designer Raymond Loewy’s fountain dispenser to the Spenserian script of The Coca-Cola Company (NYSE:KO) logo, visually unchanged for over 125 years, The Coca-Cola Company (NYSE:KO) is one of the most recognized brands in the world. Its design prowess was featured in the London Design Museum exhibition in 2011.
The attractiveness of its packaging and advertising has led to a worldwide Coca-Cola collecting boom over the last few decades. In the past few years The Coca-Cola Company (NYSE:KO) has teamed up with notable fashion designers like Moschino, Versace, and Missoni to design limited edition bottles with proceeds funding health care access for Italian women. Special edition cans have also contributed to the World Wildlife Fund.
McDonald’s Corporation (NYSE:MCD) may seem a surprising choice for a master of design but its bright colors, distinctive arches repeated in its logo, typefaces, and packaging are recognizable even to the pre-verbal child…globally. Sleek Italian design wouldn’t necessarily work at McDonald’s Corporation (NYSE:MCD); function (taste and affordability) is more their aesthetic, but it’s not unhandsome.
Why does it all matter?
Companies with strong brands have historically performed better according to BrandZ. Protecting and enhancing the brand are top jobs at these three companies. The strategy has worked although these three have underperformed the S&P 500 this last year, especially Apple.