Q&A with Kate Newlin, Author of “Passion Brands”

By Amanda Ferrante, Assistant Editor,

Giving consumers something to talk about is an ever present challenge. Give consumers something to be passionate about is even more difficult. Business strategist Kate Newlin calls for nothing less than a renovation of the process through which we develop, market and improve the goods and services of our consumer economy – based upon an unprecedented level of engagement with the consumer. In her new book “Passion Brands,” Newlin advises the forging of brand democracies, marketing states in which consumers have as much of a vote as the manufacturer and marketer in the design, pricing, packaging, marketing and uses of their favorite products. Retail TouchPoints recently caught up with Newlin to find out what retailers can do to cultivate greater engagement with their consumers and work with CPG companies to align their marketing efforts.

Retail TouchPoints: “Passion Brands” is focused primarily on CPG companies, while retailers were not as prevalent. Is this because retailers are not demonstrating the characteristics of a passion brand?

Kate Newlin: Well, I focused on the retail environment in Shopportunity! (Collins, 2006) and came up really dry in terms of great retailers who could keep themselves from what one client terms “the heroin of price promotion.” There are, of course, the exceptions: Nordstrom is one obvious one. This economic environment has not been a good one for retail creativity, clearly.

When I did the research for Passion Brands an element of the research was an omnibus consumer (telephone) survey which was agnostic about what constituted a passion brand – we didn’t ask consumers to name a brand in certain categories. We simply used the definition of a Passion Brand (a brand you feel so strongly about that when you recommend it to a friend and the friend does not love it the way you do, there’s a question mark over the friendship, not the brand) and asked them if there were any brands that met the criteria. We got lots of answers that weren’t classic goods or services (sports teams, cities, restaurants, films) but NOT any retailers.

RTP: What could and should retailers be doing to become a passion brand? What are some of the key takeaways and must-haves for retailers to affirm the passion brand attribute?

Newlin: I wrote the book to be as diagnostic as possible. There are seven key stages to developing brand passion – and they need to be thought through in detail, but a couple spring to mind as particularly relevant to retailers:
  • Market to a mindset (not classic demographics). Red Bull says that it targets people who are mentally fatigued, physically fatigued or both (who EXACTLY does that leave out?). That need state targeting allows them to appeal to clubbers and truck drivers simultaneously. Prius had a three-part target in-mind: Tree-huggers, the early adopters of technology and the fanatically frugal. I think retailers tend to think about “fashion-conscious women” or “time-starved women 25 to 54 with children” without getting into genuine sense of the pulse points of their most powerful and highest priority consumers
  • Differentiate on design. And I don’t mean here the design of the products you carry, but definitely that as well. I mean the stuff that badges a consumer to you: The shopping bags, the store credit card, the sales circulars. I’m a big fan, for example of the retailer Pink as it does its sales. Pink Sale bags are a mark of sophistication and savvy. There’s no nasty, desperate advertising. Just cool people walking around with Pink Sale bags – walking advocates and awareness builders for the brand.
  • Hire Passionistas. This to me is the biggest tragedy of modern American retailing: The presumed belief that working at a department store is on a level playing field with a drug store or a fast food joint. Yet, as we see from the numbers of subscribers to Teen Vogue and all manner of other retail goods-centric publications (sports, entertainment, literature) there is a deep and abiding interest on the part of consumers in a wide group of retail products. Why aren’t we recruiting people who love fashion to work in these boutiques and department stores, training them about the goods (not sending out DVDs about how to upsell consumers who seem to be undecided) and the fit and the fabric and the entire romance of these categories? If Howard Schultz can professionalize counter help into barristas, why are shoppers constantly confronted by gum-chewing kids who’d rather be talking to each other than helping customers figure out the right blouse to go with the skirt?
RTP: How are CPG companies working with retailers to do joint marketing or cross promotion to capitalize on passion brands making it a driver for a retail store, and ultimately, increase sales?

Newlin: CPG companies have learned the hard way that if they just provide “slotting allowances” (which is another way of saying “pay to play”), they don’t get much more than shelf space. If, on the other hand, they work with each retailer to use discretionary funds to create “customer-specific marketing programs,” they gain access to a range of retailer loyalty programs, cause-related marketing themes and a sense of uniqueness the retail setting. When they do the due diligence of aligning the brand personality with the store’s and the promotional setting, you get something that appeals to the consumer on an element other than “okay, available and cheap.”

RTP: Given the economy, pricing and cost pressures are a big concern for retailers. Is it easier for passion brands to avoid cost cutting and/or command a greater price because of their value?

Newlin: Well, that is the $24,000 question, isn’t it? I believe it is. I think if a brand goes to the effort – over a sustained period of time – of creating genuine consumer passion, then it does get into the area of “no substitute will do.” And once you’re there – then it’s no longer about price. It is about the ultimate value of getting something that is mine, something that I own. Think about an iPod or an iPhone. We just had to get our hands on it. There are other brands out there – but the Apple offerings have become the gold standard against which everything else is compared. When we pull out the iPod, we don’t have to explain our decision to anyone. We’re free to talk about the thing itself, its joys, its features, even its frustrations. When we opt for the knock off, we do have to explain and rationalize the decision -- usually in terms of price – and so the communication of the passion doesn’t happen.

RTP: Private label brands have seen growth, likely attributed to the economic crisis. It is possible for this growth to impact passion brands? Conversely, do passion brands create a barrier for private labels to reach their full potential because they invoke such a high emotional value and attachment in consumers?

Newlin: I believe that cutting back on our genuine passion brands is the last thing we do. We’ll give up all sorts of other habits and practices before we’ll trade down from our love of Jack Daniel’s or Starbucks or the Yankees or Nascar or Volvo.

RTP: “Passion Brands” includes a broad variety of brands with an innovative approach that warrants the title, including Red Bull. Can you expand on the thought of marketing by inclusion (rather than the traditional exclusionary approach), how it contributes to creating a passion brand, and other examples of where this strategy could work well?

Newlin: The thing about great brands is that you very often find that they appeal to a pretty wide series of sub-segments of people. What great passion brands do is that they find a way of welcoming diverse groups of people. I came to think about it as developing “dog whistle” marketing. As I mentioned before, Red Bull and Prius identified multiple targets, but they also do something else, which is one of the markers of passion brands: Know they know you need them.

I don’t believe there is an unfocused group person left in the developed world. Everyone knows that marketers reach out to consumers to figure out how to appeal to them. The great brands of the future are going to take that sensibility, that inside-the-tent perspective and own it. Think about the wink we all get in Geico advertising. They are typically running three or more campaigns simultaneously: the gecko, the cavemen, the weird announcer for normal people, as examples. Fabulous willingness to keep us engaged and entertained, multiple pathways into the brand. They meet us at our level of need (on TV, it’s to be entertained) and they have other media, such as the web, to get transactional. And, just think about it: Geico is the old government employees’ insurance company. I always point this out to retailers and manufacturers who start to whine about how difficult it is for them to create a compelling brand personality.

Prior to launching her own consultancy, Kate Newlin Consultants, Newlin was president of Faith Popcorn’s BrainReserve, a trend-based marketing consulting firm. She developed proprietary innovation acceleration techniques on behalf of RJR Tobacco and its core brands (Camel, Winston, Salem and Doral) which she continued to apply with a variety of brands and companies seeking incremental revenue from existing equities. During her career, she’s worked with a broad cross section of the Fortune 500 and entrepreneurial firms, including McDonald’s, Pennzoil/Quaker State, Kraft, Hasbro, Cigna, GE Capital, Guthy-Renker Corporation, Specialized Mountain Bikes, Waldenbooks and LensCrafters.