Share Equity, Win Authenticity

Dual Benefit: Don't Just Snatch Other Brands' Appeal to Heighten Your Own; Give Something Back, Too

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Nothing seems more prominent in marketing and advertising today than borrowing equity: using someone or something else's appeal to increase your brand's appeal.

Keeping it real: An ad for ESPN The Magazine shows the creators understood the unique experience of being a DJ and were interested in representing DJ culture in a meaningful way.
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Borrow a trendy word such as "bling" or a potent signifier such as "luxury," then make it a critical part of the company's messaging. Hire a DJ in a crooked Kangol hat to communicate via cultural osmosis. Borrow the indisputable equity of a pop star to build brand affinity. Dress a starlet and bank on Hollywood glamour to become fashionable.

In an industry constantly seeking the next big thing, isn't it time for a different approach? What if instead of borrowing equity, companies sought to share equity? It sounds simple enough, but it requires a major shift in perspectives and intentions.

Mutually beneficial
At the core of the idea of sharing equity is this: While you always want to benefit your brand, you also want to authentically benefit the culture from which you're borrowing. The goal is to carve a balance so properly executed that it propels both sides.

Sharing equity lies at the heart of Quiksilver's philosophy. Matt Jacobson, co-founder of Quiksilver Entertainment and head of market development for Facebook, refers to it as "benevolent market leadership." A company should seek to grow the entire market with which it is trying to get involved. It's not about dividing and conquering -- nor is it about thoughtless, lemming-like co-optation. It's about giving back to a culture in an honest way -- and profiting from the connection as a result.

"When I was at Quiksilver, we were a big fish in a medium-size pond," Mr. Jacobson said, "so I was always about growing the pond. Everything we did was about building surfing and skating culture, not just being No. 1 or simply selling more stuff."

Not long ago, MTV came to Quiksilver with the idea of creating a female surf show called "Roxy Girl," which would be based on Quiksilver's women's brand, Roxy. Quiksilver passed. The company thought it would be lame to produce a show that was all about the Quiksilver brand, even if it might bring short-term gains. It wanted something that would expand on its commitment to support and empower the action-sports market.

Growing industry above brand
Quiksilver called back MTV and pitched a new idea, a show called "Surf Girls." It brought in athletes from competing action-sports lines such as Vulcam and Billabong and turned "Surf Girls" into an industrywide initiative that focused less on TRL Nation and more on growing the action-sports industry. In a short time, it drove the women's surf market up 12% -- and introduced surf culture to 54 million viewers. This is the kind of benevolence everyone can admire. And it has allowed Quiksilver to grow from a $400 million brand to a billion-dollar brand.

So if the goal -- and who doesn't share this goal? -- is making a real (and profitable) connection with a particular market, the answer is: Share your equity. Move forward with a genuine understanding of how to authentically speak to a market empowered by a real passion to nurture that market.

"Mac Cosmetics became a success in the hip-hop community, for instance, because it was the backstage resource for all the recording artists," said John Demsey, president of Estee Lauder. "It was a brand that always supported the insiders, whether it was supporting make-up artists or unknown fashion designers or Alicia Keys when she was doing her first showcase. Mac's acceptance came from a truly authentic connection to this market."

Respect and profit
Rapper Talib Kweli said: "There's a right way and a wrong way. The right way is to respect what you're going after instead of always trying to make a buck off it. I don't see a problem with a brand using hip-hop, for example, to help sell a product. In fact, a brand can help broadcast the movement. The problem comes when brand managers have no understanding of the culture, when they're benefiting from it without giving back to it."

Professional skateboarder Tony Hawk shares a similar philosophy. "My commercial ventures haven't diluted skateboarding," he said. "They've actually opened up more eyes to the sport. When I do get an endorsement, whether it's McDonald's or Hershey's, my goal is to help spread the word of skating using their advertising dollars."

Of course, it's easier for fashion businesses and action-sports brands to adopt this philosophy. But can a mass brand share equity when it's so caught up in protecting its own?

One company has been sharing equity while percolating in plain sight. In fact, this company, which exists totally outside the record business, has reinvented the idea of borrowing equity from musicians on a vast scale.

The triangle principle
The company is Starbucks, and it sold 3.5 million CDs in 2005.

What makes Starbucks' connection to music successful is that it leverages music to contribute to the Starbucks coffee-shop experience. As general music retailers present immense offerings -- and suffer declining sales -- Starbucks handpicks its artists based on an informed sense of the tastes of its customers, which means Starbucks balances its own equity with the equity of its musical artists. That's part of the reason an artist like Paul McCartney would sign with Starbucks in a landmark "record deal" that will further change the face of the business.
Noah Kerner is co-founder and CEO of marketing agency Noise ( He is formerly a nightclub and stage DJ.
Noah Kerner is co-founder and CEO of marketing agency Noise ( He is formerly a nightclub and stage DJ.

"I always called it third-party triangulation," said Scott Bedbury, former advertising director of Nike and CMO of Starbucks. "You have the brand and the consumer -- that's two points of the triangle -- and the third point was something or someone else. It always felt foolish for Nike, as an example, to stand up on a pedestal by itself and say, 'Please buy our products,' so we always brought in the third point in the triangle. But this was never about blatantly borrowing equity like some companies do. We would develop a real relationship with the artist or athlete, and our consumers could feel the honesty in those relationships."

Target Exec VP-Marketing Michael Francis said he doesn't think of it as borrowing equity. "We share it with our partners," he said. "I feel as though we have as much to offer as we do to gain, so we are very careful about the choices we make when choosing whom to work with. We don't bring in celebrities to design lines simply because they're celebrities. We craft something that's going to work for both brands."

I grew up DJing in clubs across the country and with artists like Jennifer Lopez, so when I hear about a company trying to build a connection to DJ culture, as an example, I always think about how DJ culture can benefit. I was reminded of that idea by an ESPN The Magazine ad titled "This is a Fan." It featured a great photograph of DJ Shadow rummaging through old 45s. The copy read: "DJ Shadow is a fan. The kind of fan who tracks down the only baseball pub in London at 3 a.m. to watch his San Francisco Giants. He's also the kind of fan who creates best-selling, critically acclaimed albums that define their own genre. Like all our readers, he appreciates the unique mix of sports, culture and lifestyle found only in ESPN The Magazine." Clearly, the creators of that ad understood the unique experience of being a DJ and were interested not only in promoting their magazine, but also in meaningfully representing DJ culture.

Today I run a company called Noise that helps brands connect to the under-30 crowd. Whenever we work on a program, we focus on benefiting young people as much as our clients. So when we were developing Chase's student-credit-card program, called Plus One, we spent a lot of time thinking about the typical ways credit-card companies communicate to young people. Our goal was to change the reigning model. Young people need credit, but they must understand what they are getting into. Transparency and honesty were cornerstones of our program, and Chase supported that. In one semester, the Plus 1 brand tripled acquisition goals for Chase, and research showed dramatic lifts in brand affinity and likability.

Share equity. No one thrives in a lasting way from a selfish, one-way dialogue.

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Brand Identity
Photo credit: Hoag Levins
Check it out: This story was adapted from 'Chasing Cool: Standing Out in Today's Cluttered Marketplace' (Atria Books), due on shelves May 1. In the book, authors Noah Kerner, co-founder and CEO of marketing agency Noise, and Gene Pressman, former Barney's co-CEO, attempt to answer marketers' persistent question, 'How do we make this thing cool?' by plumbing the worlds of music, fashion, food and magazines for successes and failures. Buy it at
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