Lazarus brands: Coming back from the dead

Photo: Van Gogh Museum - The raising of Lazarus (after Rembrandt), 1890 by MicheleLovesArt (Flickr)

Another post on the Credit Suisse report: 27 Great Brands of Tomorrow Today's topic: Lazarus brands. Credit Suisse thinks that down-and-almost-out-brands represent a great investment opportunity as long as you can figure out which ones have the hope of new life. Brands like:

1) Nintendo: Nintendo's fortunes tool a turn for the worse when Sony launched its Playstation which out-maneuvered the Nintendo Entertainment System. When its next launch, the Game Cube, also failed, Nintendo was on its last legs. Then came the Wii and now Nintendo is hot again.

2) Apple: It's easy to forget these days but, not so long ago, Apple was struggling. It had a loyal but small following for its PCs and laptops but its other initiatives (in particular, the Newton) had not worked out. When Steve Jobs returned as CEO, he repositioned the company as a consumer electronics brand and, oh yes, launched something called the iPod.

3) Coach: Coach's heyday was back in the 60s, driven by the work of designer Bonnie Cashin. Over time, it lost momentum, its designs became staid and dowdy and its sales started to decline. It was saved from oblivion by the energetic intervention of a new CEO who started a program of serious reinvestment and re-design. The reinvigorated Coach brand shot past all its competitors to become the #1 brand in the U.S. market.

4) Esprit: Esprit also started out in the 60s as the quintessential Californian-born brand. In the 80s, the brand became a fashion phenomenon hitting a peak of about $800 million global sales. Then the founders divorced, the competitors caught up and revenue-enhancing licensing proliferated, all helping start a downward trend, everywhere except Asia where it continued to thrive. After ownership changes, the brand re-emerged from its strong base in Asia to once again expand globally.

What's interesting is considering how these Lazarus brands got in and out of trouble. Nintendo and Apple stumbled when they failed to stay competitive in categories which are driven by innovation. When they finally delivered a product hit, their fortunes improved.

On the other hand, Coach and Esprit fell on hard times when they under-invested and over-expanded which gradually eroded their brand equity. These two companies were saved when they refocused and reinvested.

The Credit Suisse report lists brand failures that can be similarly classified. In the "failed to innovate" camp: Blockbuster, eBay, Saturn, Kodak. In the "under invested/over expanded" camp: Columbia Sportswear, Krispy Kreme, Pierre Cardin, Sears.

If I had money to invest in Lazarus brands, I would start by looking for a sign that the company was really serious about starting over--companies with new leadership teams that had come in and committed to new innovation or focused investment would be of particular interest. With that approach I might have cottoned on to Coach, Esprit and Apple and made a nice chunk of change.

Previous post in the Great Brands series:
1) Great Brands of Tomorrow: How the 27 great brands of tomorrow were selected and Credit Suisse's bullish assessment of brand investing.
2) How imitation is hurting Chinese brand development: Why some Chinese brands will have a hard time breaking into global markets until they start developing some authenticity.

How imitation is hurting Chinese brand development

A second excerpt from the Credit Suisse report: 27 Great Brands of Tomorrow. This time, an interesting question about intellectual property protection (pp22-23):

Is the lack of IP protection in China actually hurting domestic brands more than their international brand competitors?

The thought is that Chinese entrepreneurs are not motivated to develop innovative and unique brands because their good ideas will be knocked-off without repercussion. It's easier for them to adopt a Wal-Tussin-like Private Label strategy and borrow liberally. But just like imitative Private Labels, this means that Chinese brands are limiting themselves. It may not hurt them too much in their home market but their lack of authenticity will hold them back from effective international expansion.

Previous post in the Great Brands series:
1) Great Brands of Tomorrow: How the 27 great brands of tomorrow were selected and Credit Suisse's bullish assessment of brand investing.

Even more on Great Brands:
1) Great Brands Make Great Investments: Landor colleague Allan Adamson celebrates the fact that a Wall Street firm has finally recognized that brand can be a source of competitive advantage.

Great Brands of Tomorrow

The Credit Suisse report on 27 Great Brands of Tomorrow (11mb pdf!) starts off with a strong argument for the power of brand investing:

An underappreciated investment thesis. There are few true competitive advantages in modern industry: scale, proprietary technology, monopolies, and network externalities come to mind. We believe brand is an equally powerful and even more sustainable advantage, but one often ignored by financial markets owing to its intangible nature. Our research indicates that companies focused on brand building consistently generate outsized long-term growth, profitability, and returns. An equal-weighted stock index of companies that spend at least 2% of sales on marketing outperformed the S&P 500 by more than 400 basis points annually since 1997; the top quintile of these companies outperformed the market by an amazing 17% per year.

Now that's what I'm talking about! Credit Suisse admits that its use of marketing spend as a proxy to identify brand-oriented companies is "overly simplistic." Pretty amazing that even this crude measure works as well as it does.

Credit Suisse's report picks its 27 elite brands of tomorrow based on a deeper analysis of their potential. Most of the picks are brands that are "transforming," making the leap from niche/emerging players into powerful mainstream brands. Brands like Trader Joe's and Hyundai. These are brands that offer investors attractive returns, some risk but not as much as early-stage brands that may never make it over the hump once the initial rush of growth and enthusiasm is over. Only two early stage brands make the list: Facebook and Comac, a Chinese aircraft start-up.

The 27 brands distinguish themselves in one or more of what Credit Suisse believes to be three core sources of sustainable brand value creation. These are: aspiration, innovation and scale, each one on its own capable of creating a great brand but even stronger in combination. The strongest brands of all manage to combine all three--McDonald's, Apple, Disney, for example.

A second filter that Credit Suisse uses to identify high potential brands is how they fare against a list of "must haves" vs. "can't haves." Must haves include: authenticity, quality, brand-centric corporate culture. Can't haves include: brand over-extension, short-sightedness and alienation of core market. This list points to the need to make sure that business growth is achieved by leveraging brand strength rather than destroying it.

Overall, Credit Suisse is bullish on the outlook for brand investing. It thinks that brand investing works especially well coming out of a recession as consumers are less inclined to make purchase decisions based purely on price. It also believes that there are many brands from developing markets that are poised to breakout internationally in the next few years. The top 27 brands has many of these brands including: Taj Hotels and Mahindra from India, Li Ning from China and BIM, the Turkish discount food retailer.

Canvas tops, rubber soles, Southern Californian lifestlye: The secrets of Vans success

Photo: Nicole90 Flickr CC

Kai Ryssdal, of NPR's Marketplace, interviewed Doug Palladini, Vans Vice President of Marketing about the secret of his brand's success. It's a classic story of a niche brand sticking to what it knows best, in this case for 40 years.

After receiving a huge early boost when Sean Penn wore his own pair of Vans playing the character Spicoli in the movie "Fast Times at Ridgemont High," Vans has mainly kept its focus on its thick, rubber-soled, canvas-topped, cool shoes. Whenever it wandered too far from its home base it got burned. This was the key exchange:

RYSSDAL: How do you keep going with this brand, that has evolved really not very much in the last 40 years, right? I mean it was cool shoes then, and it's cool shoes and some other stuff now.

PALLADINI: What we always try to do is dive back into what makes us original and authentic. And it's almost going back that allows us to move forward. You know, we've had times in our past, and we've been through bankruptcy where we've tried to reach beyond who we are as a brand. We've made wrestling shoes, clown shoes, skydiving shoes. We did a whole running thing... It is that Southern California culture of music, art, action sports, street culture all wrapped together around this basic-looking shoe. That is really what it is.

If you want to know more, the company has just published a book about its history called: "Vans: Off the Wall: Stories of Sole from Vans Originals."

Only in Fairfax

It was the 32nd Annual Fairfax Festival this past weekend. The Festival kicked off with the "Only in Fairfax" parade. "Only in Fairfax" is the adopted shorthand for a town that prides itself on an independent, quirky spirit. Fairfax is sometimes known as Mayberry on Acid (as in this short film which won the audience prize at the 2007 Fairfax Film Festival) --a family town that celebrates the unconventional.

Like any effective shorthand, "Only in Fairfax" captures the heart of the town and serves as a filter for what is/is not Fairfax. Businesses in town have used the shorthand to inform their initiatives (like the Fairfax 5 theatre, the first (and only) solar-powered multiplex). Newcomers like me get directed to the right state of mind.

Here are five photos from the parade representing my best shot(s) at capturing the Fairfax spirit:

The vintage fire truck works its way up Bolinas Ave

Banjo, "A's" shirt, Big beard

Tie-dyed T-shirt, helmet-wearing mountain biker

The Marin Sanitary Services dance group

California, of course

Can Saturn be saved?

The very first Saturn rolls off the assembly line in Spring Hill, Tenn: Saturn on Flickr

Amidst all the doom and gloom coming out of Detroit, perhaps a spark of hope?

When I first heard the news that Saturn dealers were going to try and save the brand, I was only half-listening and I just assumed that they were going to try and do some buy out or try and find private equity (a la MG Rover) . ºDoomed to failureº, I thought.

But now, as I read this report, I think that well maybe this plan might work. The deal, still being negotiated, would spin off Saturn's distribution network and open it up to products from other automakers.

"The goal - from a product perspective - would be to find future vehicles that match the Saturn brand: fuel-efficient, safe, reliable and affordable," Jill Lajdziak, general manager of Saturn, said in the memo sent to the dealers.

Now, on the one hand, we're not exactly short of dealerships right now and everyday there's news of dealers closing up shop. On the other hand, it's the dealership experience that has always been the true differentiator for Saturn ever since it opened up back in 1990 with its "no hassle" flat price promise. So to create a new business that focuses on the dealerships and allows them to source cars from different manufacturers makes a lot of sense. It plays to the real strength of the brand's equity.

It certainly seems a lot more promising than Saab's approach. It has just filed for creditor protection and will be leaning on the government to protect the jobs of its workers. Here GM's failure to invest in the brand is much more damaging because Saab is all about performance and having a technological edge, something that can't easily or quickly be restored.

Is brand equity elastic?

Jonathan Salem Baskin had an interesting post over the holidays titled: Holidays 2008: Price Cuts Eroded Value. I didn't buy the main argument which was (and I hope this is fair) that consumers are entering a new age of enlightenment where they will no longer be influenced by branding trickery.

But this quote got me thinking about brand equity elasticity:

"When Chanel kicked-off the October with an 8% or more price cut, it didn't offer more "value" to consumers as much as remove the "luxury tax" it normally charged for its products. Being charged less is not the same as getting more.

Does the premium that consumers are prepared to pay for brands vary depending on market conditions? Now that we're in a recession, will premium or luxury brands have to reduce prices not just because people have less money but also because the amount extra they are prepared for a brand name is also less? What Jonathan describes as a "luxury tax" might also be called a brand premium surcharge.

As with many of my posts, this one might be completely off-base so please set me straight if necessary.

A brand is not a name or a logo (Part 3 - making a killing )

For Part 3 of this series (here's Part 1 and Part 2 ), I thought we should consider what happens when you kill a brand name. If a brand is not a name or a logo, can the name and logo be changed as long as the experience remains the same? How easy is it to transition a brand's equity to a new name?

This is an important consideration in brand architecture and specifically post acquisition where the cross-selling and marketing efficiency advantages of consolidating all the business under one brand have to be balanced against the loss of brand equity that such a change necessitates.

In B2B, at least, experience does seem to be the driving factor. When one brand is replaced with another, B2B customers typically have two questions: 1) Is the product and service going to be the same (or better)? 2) Do I still have the same contact person and is customer service going to be the same (or better)? If the answer to both questions is "yes," then customers are generally satisfied. B2B customers focus on the relationship more than anything else.

But where customers may take this rational perspective, employees at acquired companies are inclined to the emotional. Speaking from first hand experience, I know that the loss of a company name and logo can cause lots of weeping and gnashing of teeth even if the working experience improves. Employees are connected to the name and logo of their company more like the Mongols gang members of Part One are connected to their patch (hopefully less intensely). B2B companies that plan to eliminate the brands of an acquired company may need to reassure their customers that things will be OK but they may have to work really hard to win the hearts and minds of their new employees.

Outside of B2B, things are murkier still. Brand experience helps shape brand perception but it's only one of a range of factors and not necessarily the most important. Think of Macy's acquisition and rebranding of Marshall Fields in Chicago. How much of the outpouring of emotion about that was the result of an objective assessment of the brand experience before and after? How much tied to the loss of the name and all it represented? The fieldsfanschicago site is still going strong so you can judge for yourself.

As Walter Landor himself said: "Products are made in the factory. Brands are created in the mind." Brands aren't things. They are impressions built from past experiences, ad campaigns, what your best friend at school said years ago and, perhaps, what people on Twitter are saying today. Names and logos represent all of that so they are a critical part of the mix. That's not to say that they can't be tweaked, changed or even eliminated if needs be. Just that care and consideration is required and it's risky to assume that the only thing that matters is the brand experience.

Brand value bubble ready to burst?

Not wanting to be left out of anything, we branders now have our very own bubble to talk about.

A new book, titled The Brand Bubble claims that most worldwide brands are dangerously overvalued by financial markets in comparison to their value in the minds of consumers. If this bubble bursts, company values could fall by billions/trillions of dollars.

Authors John Gerzema and Ed Lebar reached this gloomy conclusion by taking a look at 15 years of data from BrandAsset Valuator (BAV), the world's largest database of consumer attitudes to brands. Their conclusion is that investors are dramatically overvaluing brands because they are looking at the wrong metrics, specifically brand trust and awareness. Gerzema and Lebar show that these measures do not correlate with real brand value and, furthermore, that companies that try and increase these scores via traditional awareness-building marketing programs are likely to actually destroy value.

What companies and investors should be focusing on is "energized differentiation" or, in less technical language, a company's "appetite for creativity and change." Moving the needle on that metric will help drive brand value and start closing the gap between how consumers perceive and investors value brands. The book offers a model to help companies assess and develop energized differentiation in their own brands.

A while back, I wrote about the dangers of focusing on things that can be measured rather than things that matter. In that post, I used the example from the medical field where doctors rely on proxy metrics to see if a drug is working. The problem is that this "treating the numbers" approach backfires if there are faulty assumptions made about the relationship between the condition and the proxy metric.

Tracking brand awareness because it's easy seems to be a classic case of this problem, close to home.

Previous Posts in the Death by Tools and Metrics series:
1) Discounted Cash Flow and Earnings per Share
2) The P&L
3) Same store sales
4) ROI
5) Treating the numbers (measuring what you can measure instead of what's important)

After the financial meltdown from a brand perspective

Photo: Union Bank of California rebuilds its headquarters after the 1906 San Francisco earthquake

The incredible events of the last few weeks have, to say the least, shaken up the financial services sector. As a brand strategist, I've been watching with shock and awe as company after company has been swallowed up by this man and mortgage-made disaster--some put completely out of business, others forced into marriages with financial institutions they would never otherwise have been attracted to, arranged by the FDIC, shotgun in hand.

At the time of writing, the storm (like the bailout plan) has not yet passed but it's not too early to think about the remantling of what has been so suddenly dismantled. Looking at things from my branding perspective, some observations and some questions:

1) Rebuilding trust: Bank failures were something you read about in history books. No longer. People's confidence and trust in financial institutions has taken a hit and it's going to take time and energy to win that trust back. What's needed? A clear and transparent way to show customers that lessons have been learned and changes have been made in how investment decisions are made.

We can expect a fair degree of cynicism from consumers so recently treated to taglines like: “The strength to be there" (in a before-the-meltdown AIG spot). And we should not expect either that consumers will be easily persuaded by talk of how many billions of dollars of assets banks have. They've seen that billions were not enough to save the likes of WAMU ($310 billion in assets).

Banks that stayed clear of the mortgage business in the last couple of years and those that have had a diversified or large enough business to ride the storm will have enormous advantages going forward. But, even for them, what's called for now is a conservative, perhaps humbler, approach. Very much back to basics.

2) Integrating assets: Bank of America, Chase and Citi have huge amount of work ahead of them integrating the assets of companies that they have acquired. Even Bank of America, an expert in integration after years of acquisitions, is likely to be stretched to its limit as it tries to absorb Merrill Lynch on top of not-yet-fully-digested Countrywide and LaSalle Bancorp. One important and fragile asset is people. Companies will have to move quickly to retain talent and engage employees from acquired companies with a shared vision of the future.

3) Integrating brands: Some businesses find themselves living together in very unexpected unions. WAMU was all about not being the same as other banks. Now it's part of JPMorgan Chase. Who would have thought that Bank of America and Merrill Lynch would wind up together? These sudden mergers throw up some interesting brand architecture questions. JP Morgan Chase has already announced that all branches of its combined network will carry the Chase brand. Is that right given WAMU's so distinctively different approach? How will they pull off that transition without losing customers? What should Bank of America do with Merrill? Leave it completely alone? Add some kind of endorsement like U.S. Trust? Or consider even closer integration? Will the overall trend in financial services towards master branding slow down or reverse if companies decide they need to build risk firewalls between one part of their business to stop problems in one area affecting everything else?

4) Improving customer experience: Both Wachovia and WAMU had focused on delivering superior customer experience as a way to differentiate themselves from the bigger banks. The Forrester's Customer Experience Index suggests that they had been successful since both banks were ranked towards the top of the list. Now that they've been acquired by Citi and Chase respectively, it will be interesting to see if any of the approaches they pioneered can be successfully transferred to the bigger banks.

5) Changing attitudes about money: How far will the current financial crisis affect people's attitudes about money? Will this crisis pull people back from living way beyond their means? Some are suggesting that it's time for people to start cutting back. Is that opinion likely to catch hold and, if so, will financial service companies then be held accountable for encouraging good financial behavior and discouraging poor behavior? Bank of America has been airing TV ads that focus on saving. Is this a good start?

Links:
1) Will WaMu brand jive with JPMorgan Chase? AP
2) Banks: Making saving sexy: CNNMoney.com
3) Shiny Happy Bankers: The New York Times

Old brands never die; they just fade away

Rob Walker's article about brands and brand equity in The New York Times is well worth a read. It focuses on a company called River West brands that buys "dead" brands (brands that no longer have any products or services sold in the marketplace).

My Cliffs Notes (which, in a slightly related point, until this last second I always thought was Cliff Notes):

1) Brand equity doesn't die just because a brand's products are not around anymore. People still have perceptions about brands like PanAm, for example, years after they are off the market.
2) On the other hand, people do start to forget the specifics. For companies like River West this provides an opportunity to leverage the familiarity and positive associations with these brands while still being able to reinvent them to be relevant to consumer's current needs.
3) The trick is to keep just enough of the right cues that people remember but not be too tied to the past on the specifics. The most famous brand back from the dead is the VW Beetle. It succeeded in its second life because it was layered with "nostalgic reassurance" but had completely different (and better) product performance. It's why the Mustang worked but the Thunderbird did not.
4) Some brands have more potential for reincarnation than others. Eagle Snacks, for example, seems to be a great vehicle for a new range of innovative snacks that River West is launching. Whereas the company has had much more difficulty finding a role for Brim. Even though consumers recall this brand (92% awareness), it's still got to be a mainstream coffee brand and that's just not a market that's going anywhere at the moment. Awareness does not equal usefulness.

Links:
1) Can a Dead Brand Live Again? New York Times
2) How to Revive Outdated and Dying Brands: brandeo
2) "Old soldiers never die" proverb

Choice of beverages

A nice example of the relative position of Coke and Sprite on the brand pecking order, as demonstrated in flight:

Passenger: "Can I have a Coke, please?"
Flight Attendant: "I'm sorry. I only have Pepsi. Will that be OK?"

Passenger: "Can I have a Sprite, please?"
Flight Attendant: "I have Sierra Mist. It's just the same."

P.S. Is any airline ever going to offer anything different from the Pepsi/Coke selection. Or even a fuller range of one of these company's products? Surely a missed opportunity for a chink of differentiation.

Death by tools and metrics #2: The P&L

This is the second in a series of posts about the dangers of blind allegiance to tools and metrics. In the wrong hands, used for the wrong purposes they can be killers.

Like the P&L. Of course, no business could run without managing the topline, bottomline and all the lines in between. This tool is fundamental to efficient business operation. But, unfortunately, it doesn't cover all the things that a brand manager needs to pay attention to. Specifically, it doesn't measure brand equity. That's an intangible asset only to be found (with difficulty) on the balance sheet.

The unfortunate consequence of this is that equity that has been built up in a brand, sometimes over years, can be used or tapped into at any time to help meet P&L targets. And the temptation can be very difficult to resist. Behind in sales in the first quarter? Let's cut advertising and get back on track. It works but it has a hidden cost. The good news is that brands are generally quite resilient and can stand up to some abuse. But with long term neglect, the damage can become irreversible.

A couple of ways companies can protect their brands against the short term bias a P&L tends to generate:

1) Promote leaders who are brand believers and strong enough to protect them against those who want a quick fix for financial problems

2) Add other performance measures that make it less easy for the brand treasure chest to be raided with impunity

First post in this series: Discounted Cash Flow and Earnings Per Share and their crimes against innovation

When brands and business collide

My printer at home has broken so, today, I had to go to the Fedex Kinkos to print out my boarding pass for my flight tomorrow because one thing I'm definitely not doing at 6:30am in the morning is wait in the ludicrously long United line at SFO for one of those. Security is bad enough.

Anyway, the FedEx computer I was using seemed to take an intermnible amount of time to do anything. As I sat there and waited, and waited, I had plenty of time to think about the fact that they would have little business incentive to invest in anything faster. I was paying by the minute so, the slower the computer, the more money they make. Minutes here and minutes there would add up to a lot of money pretty fast. But what about the brand promise of "The World On Time?" Shouldn't this include speedy computers?

Now, it's quite possible that I was using the only slow computer in the entire FedEx network or that it wasn't a slow computer at all but just a temporary connectivity problem. So this may not, in fact, have been a battle between business and brand at all. Just my bad luck. But, whether it was or wasn't, it is the kind of thing that happens all the time. It's a battle where, too often, the brand loses.

Brand equity

If brands are one of a company's most important assets then putting them under the control of of people who are managing a P&L and who are rewarded primarily on revenue or profit performance doesn't make much sense. That's still the model at most CPG companies.

A Southwest frame of mind

When I travel on Southwest, I put myself in a Southwest frame of mind. I sit on the floor in line to make sure I'm an "A", I laugh at the corny jokes and I know I'm not getting much of a choice of anything. I do this because that's the Southwest way: no-one's getting any special treatment, everyone's in the same boat (/plane).

So, this new "business select" fare which gives business travelers paying for the more expensive "last-minute" fares the benefit of automatic "A" stature and a free drink is treading on vary dangerous ground. Southwest insists that it's not becoming a two-class airline like everyone else. I'm not so sure.

T.J. Maxx - Breakaway Brand of 2007

Landor's own 2007 Breakaway Brands Study is out and T.J. Maxx is the surprise leader of the pack this year. The study measures brand momentum (rather than absolute brand strength) over a three-year period with an estimate of the resulting growth in financial value. This year's top 10:

1. T.J Maxx
2. iPod
3. Blackberry
4. Stonyfield Farm
5. Samsung
6. Costco
7. Propel
8. Barnes & Noble
9. General Electric
10. Microsoft

T.J. Maxx topped the list by turning its brand ship around, one of the toughest brand challenges. It's reinvested in marketing and advertising and successfully taking advantage of consumer's desire to find bargains in stores that are engaging rather than depressing.

Other notables on the list:

GE: benefiting from its "ecomagination" campaign
Microsoft: Xbox buzz plus goodwill engendered by the Bill & melinda Gates Foundation
Stonyfield Farm: maintained its organic credentials despite sale to Danone (whihc gave it a much stronger retail presence)

GM brand: Hummer or Volt?

I've got to admit I admire the chutzpah of the new Hummer ads as described here. It's just short of literally incredible that the new campaign "Hummer Heroes" positions the gas-guzzling monster as a positive thing for humanity.

Whether the campaign has any effect on Hummer's image remains to be seen. But one thing's for sure: while consumers associate GM with the Hummer it will be impossible for the company to position itself with any kind of credibility as a leader in the battle against global warming.

In the reputation stakes, the Chevy Volt is no match against the mighty Hummer.

Two quick tests of brand power

1) How excited are your customers when they open the box?

2) Do your customers say "my" or "the" to describe your products. (Example: "We couldn't live without our TiVo" vs. "We've got to go and buy a new TV because the old one has broken")

Reich vs. CSR

Can big companies be good corporate citizens? Should they even be trying? In his new book, Supercapitalism, Robert Reich, Bill Clinton's Labor Secretary calls CSR "a dangerous diversion that is undermining democracy" and that companies "cannot be socially responsible, at least not to any significant extent".

Reich argues that its governments not companies that must solve social problems, something they have not been doing adequately partly because CSR programs fool the public into believing that these problems are being taken care of.

Reich's argument is based on the assumption that companies are in business to make profits and CSR programs do not support this mission. While this might be true in the short term, it ignores the brand and reputation building effects of CSR programs. A strong CSR program will increase brand equity and therefore the company's value, very much in a company's self interest.

CSR programs can also help improve the quality and performance of the workforce because they increase a company's attractiveness to potential recruits and energize and motivate current employees.