Ironbound Consulting Group - Blog

Generating Customers by Creating Society Value

3/27/2020

Image: Lyft

Corporate Challenge: Manifesting new customers from outside the market space.

Ironbound Strategy: If you never stop creating value for customers, employees, and society, new customers will overwhelmingly flock to your brand.

Ironbound Action: California based Lyft now provides rides to people who don’t have the Lyft app, including those who don’t even have cell phones. Lyft has partnered with rural communities such as Vernon County (210 miles west of Milwaukee) that don’t have taxi services to provide safe rides for bar patrons late at night. Bartenders are able to call Lyft’s for their patrons using a unique dedicated service that allows upfront payment by the bar, foregoing the need for the passenger to have a Lyft account. When brands search for new ways of creating value for society, their efforts always increase their customer base.

* The NTSB's most recent report (2016) reported that around 30 people die every day from drunk driving in the US (almost every 48 minutes) with 10,500 deaths and 290,000 DUI injuries annually. These statistics are expected to decline with Lyft’s influence.

** Lyft launched in 2012. It has reported over 1 billion rides, by 30 million riders, in 2 million vehicles. Lyft’s expected FY19 revenues is $3.5B.

How 21st Century Companies are Serving Stakeholders

3/13/2020

Image: Ski Chalet available on Airbnb

Corporate Challenge: Impressing Wall Street

Ironbound Strategy: Most investors are seeking strong sustainable long-term earnings. Powerful brands propel in value by holistically creating value for society, employees, and customers. Companies that serve all stakeholders uniquely align and strengthen their capabilities, ultimately forging powerful brands and consequently commanding superior returns.

Ironbound Action: San Francisco based Airbnb, founded in 2008, recently updated their work mission to include creating value across all stakeholders – “serving all stakeholders is the best way to build a highly valuable business and it’s the right thing to do for society”. The depth of value creation is at the core of attracting capital and propelling valuations. Serving society, employees, and customers is the most valuable business strategy.

Partnering with Non-Profits for Brand Growth

2/28/2020

Image: Crabtree & Evelyn Soap from Hilton Hotels

Corporate Challenge: Finding new ways to improve the planet.

Ironbound Strategy: Strategies that promote creating value for customers, employees, and society improves a brands presence and awareness, globally.

Ironbound Action: Virginia based Hilton Hotels sought to find a solution to soap wastage, in their global efforts to minimize their environmental footprint. Instead of switching to soap dispensers like their competitors, Hilton partnered with Clean the World (a Florida based foundation) to melt down old soap bars and create new ones for the developing world. Brands that partner with non-profits that affect positive global change, are able to instantly elevate their brand. In the case of Hilton, they were able to elevate their brand using a currency they were quite literally throwing away.

* Two million soap bars are discarded at hotels in the US every day. Soap prevents several leading causes of death among children under the age of 5, including pneumonia and common digestive tract illnesses. Clean the World has been able to make over 50 million full-size soap bars, and distributed them to 127 countries in need.

** Hilton operates over 913,000 hotel rooms, at nearly 5,600 properties globally. Last FY Hilton had $8.9B in revenue, up from $8.1B the year before.

Distinguishing Between Consumer Fads and Lasting Trends

2/14/2020

Image: Beyond Meat

Corporate Challenge: Determining whether a competitive position is a new lasting trend or just a passing Fad.

Ironbound Strategy: Powerful brands become trend setters by holistically creating value across stakeholders. Their market position is propelled by value propositions that improve multiple needs rather than a single fad. Studies from cause-related marketing research find consumers are attracted to brands that align with their social responsibility values.

Ironbound Action: Los Angeles based Beyond Meat, founded in 2009, is a leading plant-based meat substitute. Their success is more than simply an alternative to traditional meat protein, but rather a holistic shift towards progressive change. Beyond Meat, named company of the year in 2013 by People for the Ethical Treatment of Animals, helps consumers positively influence climate change*. In the grand scale of time, companies that compete only for profits are the true fads sinking into extinction.

*Beyond Burger uses 99% less water, 93% less land, generates 90% fewer Green House Gas Emission, and 46% less energy than a traditional meat burger.

** “Climate change will have significant implications for agriculture and food security ... for developing countries, climate change could exacerbate the food security challenges they already experience.” – 2018 Food and Agricultural Organization of the United Nations Report

When to Bond with Customers Through Targeted Co-Branding Sponsorships

1/31/2020

Image: Bud Light NFL Cans

Corporate Challenge: Strategically changing logo branded colors to attract fan-based consumers.

Ironbound Strategy: Powerful brands are always seeking to forge strong meaningful relationships with their stakeholders. Friendships are built on common interests. By changing branded colors to show genuine team support, brands can become fans and build comradery among enthusiasts.

Ironbound Action: Sports and team spirit bring different people together into one shared community. Brands can also entrench themselves into these communities by showing their support with team colors. Beverage maker Bud Light has capitalized on this opportunity through sponsored NFL team cans. Bud Light co-branded cans are so popular that super fans outside of home team markets desperately want them too. The tactic of co-branding through team sponsorships works best when reaching consumers faithfully devoted to a team.

* America drinks approximately 325 million gallons , roughly $1.3 Billion, of beer on Superbowl Sunday. Superbowl viewership peaked in 2015 at 115 million and has since been in decline with about 98 million viewers in 2019. NFL received approximately $1.4 Billion in sponsorship revenues during the 2018 season, a 5.1 % increase over the previous year.

Startups Creating More Value with Vertical Integration

1/17/2020

Image: Harry's Shave Club

Corporate Challenge: Assuring startup success.

Ironbound Strategy: Startups that create value for customers, employees, and society can grow their brand presence faster than their competitors.

Ironbound Action: New York based Harry’s Shave Club is a startup that vertically integrated manufacturing to distribution from the very beginning. By owning verticals Harry’s was able to provide high quality products at lower than expected prices. Owning verticals allowed Harry’s to create a second brand, Flamingo, to provide personal care solutions for women, and double their brand presence. When a startup is vertically integrated, it has similar advantages to the competition, but with nimbleness to outcompete them. By ceaselessly creating value for customers and society, any brand can exponentially grow, even in slow growth spaces.

* Harry’s grew from 0 to 2 million customers in 3 years. Currently Harry’s is worth over $1.4B. The shaving market is slow to grow at 4.6%. The key to Harry’s success was to take market share away from competitors by creating an overwhelming amount of value for customers, employees, and society.

Why Startups Must Have a Meaningful Purpose to Succeed

1/3/2020

Image: Salesforce

Corporate Challenge: New startup seeks to standout in crowded market.

Ironbound Strategy: Powerful brands get noticed because they operate with meaningful purpose. The surefire way to attract attention and resonate world changing ideas is to permeate meaningful core values across all stakeholders.

Ironbound Action: San Francisco based Salesforce.com, founded in 1999, was the first to introduce a new 1-1-1 philanthropic extension to the business model. The Salesforce Foundation is comprised of 1% equity, 1% employee time, and 1% of their product. Since their Initial Public Offering in 2004, Salesforce stock (CRM) has soared (adjusted for splits) from $4 to $160 today. The strong stock price performance reflects phenomenal revenue growth from approximately $100 million in 2004 to nearly $14 Billion in 2019. By being in business for more than just profits, holistic value creation continues to propel Salesforce as the world’s leading enterprise cloud ecosystem.

Challenging Conventions and Changing the Rules

12/13/2019

Image: Amazon Ford Delivery

Corporate Challenge: Distinguishing your brand from the competition by challenging conventions.

Ironbound Strategy: Brands that constantly create value for customers, employees, and society are able to successfully challenge conventions.

Ironbound Action: Michigan based Ford Motor Company recently teamed up with Amazon to change the convention of parcel delivery. Who says packages always need to be left on doorsteps? Willing customers can now allow Amazon delivery to temporarily unlock trunks of new Ford vehicles to safely deliver packages. Amazon and Ford consistently create immense value for their stakeholders, such that they can successfully succeed at challenging general conventions. Great brands tend to always come up with outrageously innovative ideas. Those that relentless create value for stakeholders have the easiest time implementing them.

* Ford's domestic sales were around 2.6 million vehicles in FY 2018, with expectations to sell close to 2.7 million vehicles in FY 2019. Amazon ships 1.6 million packages per day in the US. Amazon’s Q3 revenues were $70B, up from $56B in Q3 last FY.

How to Execute an Upcycle Growth Strategy?

12/6/2019

Image: Greg Lauren Cotton Hoodie

Corporate Challenge:  Upcycling in response to consumer trends focused on climate change.

Ironbound Strategy:  Powerful brands are corporate ambassadors of social responsibility.  They appeal to their employees and customers by engaging in strategic activities that reduce waste on society.  Brands that upcycle have an opportunity to expand their product narratives, and thereby increase their appeal, by continuing the original story of upcycled materials.

Ironbound Action:  Haute couture designer and global ambassador, Greg Lauren, focuses on upcycled high fashion.  Each garment is uniquely designed to preserve the emotional connection of the original vintage fabric, while upcycled into a completely new transformation.   Using entirely upcycled iconic American materials, with a focus on decommissioned military textiles, each collection embodies a vintage and futuristic nihilistic theme.  By unlocking past identity salience, sophisticated consumers are magnetized by unique and fascinating storylines.  Brand power is fueled by expanding stories that create value to build a better world.

* Extending the life of clothing by three months reduces the carbon and water footprint by 5 -10 percent. Almost all clothing and textiles are recyclable and yet the average American throws away approximately 80 pounds of used clothing per year. More than 15 million tons of used textile waste is generated each year in the US. Approximately $400 Billion in merchandise was returned to retailers in 2018, most of which end up in landfills.

Using Augmented Reality to Acquire Customers

11/22/2019

Image: Snapchat AR Experience

Corporate Challenge: Creating new ways to promote a brand.

Ironbound Strategy: Augmented reality (AR) is a fun way of getting the attention of millennials. Using AR to create long term value for customers, employees, and society will convert the hype into loyal customers.

Ironbound Action: California based Snapchat is helping brands with entering the AR market space. Recently Snapchat created a virtual 360 shopping experience for Lego’s new clothing line. Snap users could move around a virtual store, purchase items, interact with Lego characters, and even have the Lego DJ change the in-store music. Brands can use AR to tailor their customer experiences, and take online shopping to a more personal and technologically thrilling level. AR is still new and exciting. Brands that are dedicated to their customers will likely be the first to invest in AR, and dominate the space.

* With 3.3B smartphone users worldwide, AR is being positioned to be used and operated through mobile devices. The market size of the AR service market is expected to be worth $50B by 2024, but with the heaviest emphasis on AR maps. As retailers move into the AR space to sell products and provide customer experiences, that estimate will be multiplied.