I had an awesome time yesterday at The Feast, a conference on Social Innovation sponsored by All Day Buffet. I posted two great videos to /Anecdotes, one from GirlEffect.org and one on Vertical Farming. It was so inspiring to meet lots of other young people innovating on global and local causes and building companies that truly believe in the double bottom line. (TerraCycle is a great example).

I told a few people that I would post a list of Twitters who attended so folks can “follow” others looking to connect on social innovation topics. If you want your name added to this list, simply post your handle in the comments and I will update the list as needed:

• Mike Karnjanaprakorn
• All Day Buffet
• Jpalladino
• Joeippolito
• Santhonys
• Tina Eisenberg/Swiss Miss
• Sam Huleatt
• Johanna
• Jake Bronstein
• PSFK/Piers Fawkes
• Gaurav Mishra
• Nichelle
• Tung Bach Ly

I just used a Starbucks gift card I had been given. I got it back from the Barista with $.90 remaining. Likewise I have a gift card from Best Buy with $4 remaining on it.

I’d like to see a more charitable way of dealing with ‘left-over’ gift cards. If you have less than $10 left stores should ban together and offer to split the difference; give me the option on the spot to have 50% or more be donated to a worthwhile charity like the One Campaign.

The relationship of brands within and among social media communities is still in flux. Facebook is one of the first new media companies to attempt to embrace brands outside the context of paid-advertising with the creation of Facebook’s “brand pages.â€� These pages essentially allow brands to have profiles and friends just like regular Facebook users.

At a breakfast I recently attended several people were outspoken over the “friends-with-brandsâ€� concept, believing it absurd that people would choose to be friends with a brand. They questioned what benefits a brand could really extract from a ‘social relationship’ with an individual and doubted whether brand friendships actually resulted in any form of additional customer loyalty. These questions have really forced me to think.

Readers of this blog know that the role which brands play among my generation is something I take great interest in. The term brand is almost synonymous with ‘company’ and ‘product’ in 2008. It seems anything that is popular or trendy is given ‘brand status.’ Yes, at one time the term brand connoted a status among mere mortals. Indeed, the era of the internet has allowed products to essentially ‘debut’ as brands overnight thanks to leaks, hype and buzz.

Whereas a company or product in our parents’ generation might have spent a decade or more building PR and ‘branding itself’ now a product can make or break its reputation (and hence brand) over the course of a week. Take for example the chart below showing the popularity of search terms for Ford (one of the strongest traditional American brands) compared to iPhone and the Wii. Pretty amazing, right? At certain points both the Wii and iPhone have dwarfed one of the oldest and largest employers in America.

The question then is whether the role of branding as a means for long-term customer loyalty still matters in our modern era of ‘choice paralysis’ and ‘perfect information?â€� Because, if consumers no longer will stick with a brand for reasons outside of 1) cost or 2) quality than the role of branding is in for a tough time. However, if like in the case of the ‘Mac Mindset,’ a company can capture the imagination of a key demographic group, then branding is still crucial.

I have written before about the role that certain brands play in self-identity, especially for high-end consumer goods like Vineyard Vines or Louis Vuitton. Owning such items allows people to identify themselves, particularly relating to class and social status.  However, I believe that what really separates a company that is a ‘brand with staying power’, versus a company that is simply a couple trendy products is what I’d call “voiceâ€� and “reputation optimization.â€�

By voice I mean that certain brands move beyond simply selling products to sell a voice or certain lifestyle. For example, even if Patagonia stopped selling products, it would still be a force in terms of outdoor sport for its non-profit and philanthropy work, it’s rich history of sponsoring athletes and events and its catalogue which is more a work of art than a sales conduit. Good Magazine is another example. Its actual product is solid, but where it differentiates is in how it vocalizes its mission, sponsors parties and events, and really interacts with its core audience. You get the feeling that if you wrote in, someone would respond.

Reputation optimization implies that a brand works hard to ensure that all its new offerings and products meet certain standards: from quality to price point to mission. For example, with the iPhone, people were willing to wait overnight in lines because they have come to expect a certain consistency from Apple products. When Apple says something will be innovative, you know it will be (note: they may have recently hurt themselves with the pre-hype of Air).

At the end of the day, I think that being friends with brands – within the confines of a walled garden like Facebook – is a little silly. If I am truly a brands friend, it should be mutual giving/receiving done for all to see: I get something of value and I provide something of value in return (in most cases, likely marketing). For example, I’d be interested in an arrangement where Patagonia pays for 6 months of access to the Wall Street Journal Online. In exchange, I include a Patagonia logo on all my emails for six months. Or take, Facebook Beacon. The issue was that the relationship was not two-way. What if when I made a purchase at Overstock, it said Overstock will give me 5% off this order if I’m willing to let it share the news of my purchase with my Facebook friends – now that is compelling!

Finally, in terms of reputation optimization, if I were Patagonia I would identify bloggers who frequently say great things about my company and thank them. Give them a reason to perpetuate the brand’s voice.

Brands have a long way to go online, but they also have a lot to leverage. Eventually someone will get it right.

Very interesting article from Tuesday’s New York Times highlighting the trend for “paid volunteerism.â€� The article highlights Frederick A. O. Schwarz Jr., the retired Cravath Partner and heir of the F.A.O Schwarz fortune. Stated Schwarz:

“An organization and a person are simply more committed to each other when the person is paid.�

According to the Times, an ever-growing number of retirees and nonprofit executives believe that this mindset is how modern retirees view nonprofit work. Experts agree that the automatic link between doing good and working for nothing has been permanently severed. The article further states that even the wealthiest retirees insist on being paid for “doing good.�

Interestingly, a Professor at Kenan-Flagler Business School believes the “paid volunteerism mindset� is particularly true of women:

“Volunteer work used to be considered women’s work, so it is not surprising that career women reject the concept.â€�

In the mail several days ago I received a free copy of a new magazine called ’Motto Magazine.’ It has similarities to FastCompany in that it attempts to prove that business people can be passionate, happy, socially-responsible and still make a killing! The key difference seems to be that they are more niche than FastCompany and focus more on the corporate social responsibility theme. The advertising is all relevant and includes both NetImpact and Calvert.

The mag is founded by Kevin Salwen (interviewed here) and Anita Sharpe both former Wall Street Journal writers. It seems the founders are friends of Rex at RexBlog. Preston from Texas liked it, and he likes Good Magazine, another personal favorite of mine. Curt Rosengren from Passion Catalyst writes for them. CSR Wire recently picked up a press release on the most recent edition.

Motto has a great introductory video on the website, but oddly it’s not embeddable and it’s not on YouTube (what are you guys thinking!).

I really enjoyed the first issue and hope to grab an interview with one of the founders. In particular I enjoyed the article by Lance Secretan. At $15 for 6 issues, it’s not cheap but the issue I got had more writing than most magazines.

Motto is worth checking out and some articles are available online for free.

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Brand Reputation is a discipline separate from that of traditional branding campaigns. Brand Reputation recognizes that due to increased transparency and access to information, ‘traditional branding’ whether through mission statements, marketing or affiliations can easily be verified and evaluated. Thus reputation plays an increasing role in keeping organizations honest and forcing them to take definitive actions, rather than simply making public statements. Both consumers and employees are getting into the game.

Brand Reputation is sort of like ‘Brands 2.0.’ Until recently brands had largely been considered ‘intangible’ concepts. Accounting contributed to this conception by identifying ‘goodwill’ as the excess over the book value one company was willing to pay for another. That excess was brand value.

Times have changed. More than ever before brands are increasingly the key element of any business model. Much of this power is because people view brands as a means of personal identification. Brands now trump actual products in terms of importance. For example, Abercrombie & Fitch used targeted branding and outreach to drive incredible revenues despite its products being of questionable quality. Brands now must interact with an audience, as explained by the brothers Heath in ‘Made to Stick.’Â�

Another shift has been organizations coming to embrace themselves as brands. For example, the university one attends, or the organizations one affiliates are increasingly recognizable and monetizable. Knowing that someone attended a certain college, or is affiliated with certain brands conveys all sorts of ethnic and class related information. Globalization has further complicated branding due to differences in cultural and geographic interpretations.

Still, the primary catalyst for these changes is the ever increasing prominence of the internet. As consumers have been given greater access to information they have become empowered (better informed) to decide how and where they spend their money. This empowerment has resulted in creating greater accountability on the part of businesses and organizations alike. Even Congress and international legislators have begun to demand increased accountability and sustainable practices partially as a result of online advocacy and scorecard groups who have now found an audience.

In business school we learn that the ‘goal of management’ is to increase shareholder value. As it turns out, the definition of a ‘shareholder’ is increasingly broad and can encompass anyone from a holder of company equity to management to employees to vendors. While traditional business practices have focused on the bottom line, a shift toward focusing on brand reputation takes a more holistic approach and recognizes that revenue and corporate social responsibility are not mutually exclusive. In fact, quite the opposite is true. Think Patagonia, think Ben & Jerry’s. Think of the amazing things you hear about working at Google.

Recent business trends have proven that brands by themselves are of increasing importance. Business leaders and financiers are recognizing that a strong brand can ultimately be monetized down the road. For example, MySpace, Facebook and YouTube are all companies with exceptionally strong brands but whose revenue streams (in recent memory) have been low or non-existent. Nevertheless, these companies all either received buyout offers or additional investments at valuations unrelated to actual cash flows. That says something.

Brand Reputation is community driven. Its appeal is often on a more human or emotional level and is acted out through user-engagement. It is greatly enhanced by the interactions of community members with the brand itself and by community members interacting with other community members. As discussed previously, Brand Reputation Optimization has both internal and external components. The strongest brands are grown organically and start with a focus on building internal relationships – allowing collaboration to flourish and building passion to drive the organization’s mission and objectives. After establishing such internal buy-in, the potential for building a strong brand is limited only by the degree of external engagement a firm builds into its online presence, marketing and CRM efforts.

“Brand Reputation Optimization” is a new term that I am coining. I encourage you to read this introduction, to email it to a friend and to discuss it with me. I will also be publishing a more detailed white paper on the same subject.

Brand Reputation Optimization (BRO for the acronym lovers!) refers to how an organization best positions its brand for long-term sustainability and success. Success in this case refers both to the bottom line and to applying socially responsible business practices sometime referred to as corporate social responsibility. Since the web is now the preferred method by which people receive and digest information, BRO focuses primarily on online practices though it often complements, or is a catalyst for offline engagement.

Search Engine Optimization (SEO) taught us that we can be proactive in helping people to discover companies and information online. However, now that every company has established an online presence, and given that the internet is increasingly the medium by which people receive their information (thus evolving their perceptions and first impressions) the ‘key test’ becomes that of brand distinction and differentiation. As it turns out, like search engine optimization there are best practices and concrete actions that can be taken to distinguish and optimize your brand.

The most important aspect of BRO is to recognize that people build brands and brands drive revenues. Many a company and business fails to capitalize on its most valuable asset ‘“ its own people. Social networks have taught us the power of passionate users and social media tool have helped us to unleash the power of collective intelligence often by breeding innovation organically. Passion drives engagement.

Brand Reputation Optimization has two central applications: Internal and External. Traditionally (and bound to continue going forward) is the primary focus of brand optimization on the external (such as interactions with media, the public and customers). Still it is important to reiterate that brands are in fact internally driven. If an organization’s own people to do not believe in the underlying objectives and ethics, the brand will never flourish.

External optimization can be further segmented into Proactive and Reactive Actions. Traditionally, brand development has focused more on reactive actions such as responding to customer complaints, providing warranty services after the sale, or increasing transparency practices after Sarbanes Oxley. However, thanks to new technologies (in particular social media) we now have the opportunity to focus on building brands proactively.

This new era in brand building is largely made possible by an unprecedented ability to provide online engagement in a way never before possible (think Ajax interface and social media functionality). Following Metcalf’s Law, ‘the more people using a given system, the more valuable it becomes.’ Now that much of the World’s population is embracing the internet as their primary medium for interactions (shopping, dating, research, collaboration, etc’ ) the need for organizations to humanize and to appeal to people on more of an emotional level (as opposed to simply through the use of static text and image) is paramount.

The importance of Brand Reputation Optimization should not be underestimated and I look forward to seeing new applications of this concept going forward.

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