Cebu Pacific, Uber and Grab Rebrand, New Logos

I’ve always been fascinated by company and brand logos. The creativity, symbolism, the tone and seriousness, plus the subliminal messaging it contains.

Pretty much like brand names, logos of companies or (entities in general) are everything that’s why they even hire consultants or create contests just to come up with new logos, new identity.

Two recent changes are from competitors Uber and Grab (used to be Grab Taxi). Not sure if they got wind of the other’s plan to rebrand but both changes came just a few days after the other.

These businesses are growing, and so identity must be established, asserted and polished if necessary. What started as apps are now fast-becoming global giants. Likewise, if they want to be treated seriously and exude a professional feel, then changing the graphical representation of themselves makes sense.

Make Extra Money Behind the Wheel.

Use Your Car and Be Your Own Boss.

Uber changed it’s logo from a letter “U” to a network looking logo. First noticed this when the app on my phone updated. Read an article about it and basically, the company wants to expand its services, its identity. Here’s an article discussing Uber’s change.

I haven’t used Grab Taxi but I usually see its logos, well plastered on taxi cabs. I’m also quite familiar that there are other variants such as GrabCar, GrabBike etc. So no surprises then when I heard from the news that GrabTaxi has rebranded to Grab, a more general name which encompasses the various services it offers (and maybe will offer in the future). Pretty much similar to Uber.

Likewise, when I hear of people availing of their service, they usually say “I booked Grab..” or “Mag-Grab na lang tayo instead na mag-drive.“. So in that sense people are actually using the shortcut version “Grab” as sort of a household name. Maybe its management heard. Here’s a related article on Grab’s rebranding.

The last one on Cebu Pacific (PSE:CEB) is not so recent (they changed last year) but I just noticed it last month since I’m not a frequent flyer. From the chubby-jolly airplane, its logo now looks like a serious bird, like an eagle, and it actually reminds me of the BSP logo (which also rebranded a few years back). Bottomline, it looks much more serious now as it continues to open new flights to various parts of the world.

It’s not longer just a budget airline for domestic flights, but a serious flag carrier bringing Pinoys and foreigners across the globe. Here’s an article straight from their website.

Who’s The Twitter Bird and What Google Means? Insights on Branding

We have seen some generic terms evolve into successful business names. They have succeeded to turn ordinary terms into meaningful words with great recall.

Or successful brands that have become generic terms, their success has made us embrace their names as household, everyday, conversational terms.

 

If you play Logo Quiz, then chances are you pay close attention to popular and visible brand names and their logos. In turn, they have been successful in getting a tiny space of your memory and recall.

A few weeks ago, Yahoo! presented an interesting slide show on 25 Tech Companies and How they Got Their Names. Pretty interesting, since most of these established big names also have humble, ordinary, funny and even weird (yet witty) origins.

Branding is everything, but it need not be complicated. You may view the slide show through this link.

 

Pinoy Advantage

Branding can be easy especially for us Filipinos who are creative, witty, funny, and bordering maloko. But it can also be a bane for us, since Pinoy’s also love to copy-paste. In a recent franchise expo I attended, the speaker showed what he dubbed as Mang Inasal’s greatest competition. Not Bacolod Inasal, Chicken Bacolod, ChicBoy, or Jollibee or any other store that serves delicious chicken. He showed Ma’am Inasal, a junk food that also uses Mang Inasal’s colors of red, yellow, green and black. A close competition of Lechon Manok junk food too. The threat may be real or not, but the points is tsk tsk tsk. 

Further, we have McBo in front of McDo, Putahe ng Ina Mo then there is Ina Mo Rin, many versions of Lapid’s Chicharon as long as the owner is related to any Lapid. Jollibee or Jolly Jeep? Or Generics here then Generika there. Would you associate ‘Ginebra”  to Ginebra San Miguel or Ginebra Kapitan? Haha. Sigh.

 

More Than (Just) A Big Word

Branding tries to establish you, your brand and your product / service as a top of mind among customers. What matters is that the branding should speak for itself, easy to recall, not intimidating, and appeals to its target market. Preferably original too. A good balance of creativity and simplicity. Branding is how you effectively communicate to your market what you want to convey regarding your product/s or service/s. Branding is also not just about the brand name, or the company name or the logo. It’s about consistency, the use of brand colors and logos in packaging, uniform, store displays, websites, etc. And the meaning of the logo and brand name (if there is) should be aligned to company values, objectives, vision-mission, etc.

 

Good Established Branding Cuts You Some Slack

Great products and customer service are important, but usually, once a brand has been established with strong following, then customers are willing to a be a bit more forgiving of some miscues in products and service. If you’re at the stage of building up your brand, then sorry but there is less room for booboos for you. But if you look at established brands, I’m sure they also receive a ton of complaints and public bashing (case in point telcos), and yet very few crumbled. Most remain strong brands. Because trust, track record and credibility have been built, customer forgiveness and understanding are easier to receive. Brand loyalty trumps some shortcomings. Still, that doesn’t mean once a brand is established, then they can rest easy. As they say, it takes years to build a reputation and seconds to destroy one.

 

PS. Oh by the way, the Twitter bird’s name is Larry. As in Larry Bird, the NBA Hall of Famer who played for Boston Celtics. As to why, go read this.

Photo: “Hello My Name Is”  by  Alan O’Rourke 

This work is licensed under a Creative Commons Attribution 3.0 Unported License.

www.bulbsandbubbles.com is now www.investmentjuan01.com

Dear Readers,

Pardon the transition period (and slight jumble). Bulbs and bubbles is migrating to a better address, www.investmentjuan01.com.

You may already visit us in this new address, with all previous posts, while the transition is still ongoing.

Thanks and more investments for every Juan!

10 Other Business Risks You Must Know

As previously shared, life is a risk. On the same tone, business, no matter how big or small, is also a risk. It involves a series of big and small decisions and business calls and external factors that can make or break the business, and the business owners.

 

The sooner we are cognizant of the business risks that surround us, hopefully the sooner we take steps to address, mitigate and hopefully lessen these. Just like in life, business risks are here to stay. We cannot fully eliminate them but we can always lessen them to manageable levels.

0. Loss Risk

Probably the single most recognized risk by all businesses is the risk of a red bottom line. All businesses (I assume) are cognizant of this risk so I won’t dwell much on this. In fact, majority, if not all efforts, are actually meant to derive a positive bottom line eventually.

1. Operational Risk

May pertain to production errors, defective or substandard parts/supplies used that may cause a product recall later on or customer complaints and lawsuits, malfunction of equipment, system downtime, lack of inventory to meet scheduled demand, etc which may lead to financial losses. Businesses should ensure that back-ups and operational manuals are well in place, and that there are Plan Bs should there be unexpected operational disruptions.

2. Calamity Risk

Especially in our country. Fire, earthquake, typhoon, tsunami, flash floods, landslides, sink holes, drought, pests, etc which may disrupt operations or completely destroy business premises and property. For small businesses, this is a big deal. Insurance companies refer to them as acts of God, whether you agree is another story. Best we can do for these kinds of risks is have insurance coverages, back-up and calamity plans. Regular precautionary drills, which are often ignored, may actually prove helpful.

3. Security and Fraud Risk

Risk of loss due to theft, intentional deception, identity takeover, misrepresentation and other fraudulent activities. Endangered lives due to security breach, robbery in a branch or inside job theft carried out by certain personnel. CCTV may come into mind but this only addresses a small part of the risk. As they say, prevention is always better than cure. At the very least, security of the business premises must be ensured, not just secured against robbery and theft, but also against natural disasters. Insurance, when affordable is also a good investment. Likewise, measures should be in place to detect fraud which may range from fake monies to poser customers, identity theft, account takeover etc. Checks and balances should be in place. Knowing your customer plays a big part in minimizing security and fraud risk.

4. Information Risk

In business, certain information and data are intentionally kept hidden from the customers and competitors. Examples are product costing and pricing, trade secrets, soft copies of templates, contracts, manuals, recipes, big deals you are working on, customer information and all other confidential items. The risk of exposing these information to unintended viewers and audiences can pose a risk and a loss to the business. Ensure that these items are well safeguarded, sometimes even from the eyes of our own personnel. After all, these trade secrets are what makes our business unique and competitive, and these customer information were given to us by customers in trust that these shall be handled carefully. Failure to handle information properly can lead to financial and other further losses.

5. Credit and Default Risk

The risk of the business not meeting its financial obligations (payables), or on the other hand, poor collection of business receivables. Either way, cash flow management will be key to handling this risk. When left unchecked, this risk can easily shut down business operations due to poor circulation of its lifeblood: cash. This can lead to lawsuits and reputational risks as well.

6. Legal and Reputational Risk

Risk of getting lawsuits, court cases and tarnished reputation, negative public image, loss of customers and their confidence, in the course of running the business. Failure to secure the necessary permits and clearances, pay any government dues, unknowingly engaging in illegal or anomalous deals, customer complaints blown out of proportions, failure to deliver on agreed timelines, food poisoning, etc. At this age of word-on-web, it is so easy to spread rumors and negative feedback. Aside from bottom line, it is important to take care of one’s reputation, of the company’s branding since customers value branding highly. Most of the time, company branding and reputation are valued by customers even higher than product quality and affordability.

7. Concentration Risk

Especially true for small businesses is the fact that operations may only be centered and concentrated in one location, one subject matter expert (personnel), only one equipment, data and inventory is stored in only one place, only one supplier etc. Well for practical reasons and due to the fact that small businesses cannot always afford to put up back up locations, equipment or more personnel. Just the same such set-up breeds concentration risk and as you’ve anticipated, it can be dangerous for the business. What if something happens to the location, or the expert personnel leaves the business without proper turnover or documented procedures? Or goes on extended sick leave, incapable of working for days? What if the equipment malfunctions or the storage devices are suddenly uncooperative? These definitely disrupt our business operations which can have snowball effects on other risks. Documentation of procedures, back-up copies, contingency plans must be in place. Cross-posting, rotation and skills sharing, when possible, are also good practices. Similarly, business outings and traveling together can also pose concentration risks, especially when, knock on wood, something happens…

8. Labor/ Human Resource Risk

Small businesses may not have labor unions but that does not mean its personnel don’t have anything to say. This risk may pertain to both the safety of the personnel while working for your business (any occupational hazards, tied to operational risk), or the risk of your personnel engaging in work stoppage and mass strike due to unaddressed concerns and needs. Just like inventory which runs out or equipment which malfunctions, personnel and your manpower may also decide one day to walk-out on you. Lesson is, keep them happy and satisfied. After all, your people is your best business asset.

9. Political and Regulatory Risk

You may not feel this much in your business right now but this is actually a risk very much present. Imagine if your dealing with countries experiencing political crises, power struggles etc. Won’t you be concerned of your future dealings with them? Of default risk? Or what if other countries don’t want to deal with you because you are from the Philippines? Product quality becomes immaterial because you are already branded as from the Philippines. What if certain laws are passed prohibiting this and that, or allowing this and that such as higher tariffs, controlled interest rates and pricing, or revised government contracts? These changes may have an impact on your business, may it be on operations, your suppliers or customers, and the legal bounds within which you have to operate.

10. Economic and Market Risk

Probably one of the risks that is hard to mitigate and almost always out of control, the only thing we can do is sink or swim with it. Economic downturns, recessions are somewhat cyclical. They happen from time to time and given the globalized world, a recession in Europe or US can very much affect us here in Manila. Export businesses are usually the biggest victims, but note that these events also dampen consumer confidence, which then affects domestic spending. Again the best thing we can do is be prepared to swim, find other means to generate revenues, and see opportunities in these downturns.

Quite a number of risks I listed above and for sure, there are a lot more risks out there. Certainly you have already realized that these risks are very much intertwined, adding more complexity to the risks we face. Regardless of the size of your business, there are a lot more other things that you should be on the lookout for, aside from profitability, customer satisfaction and sustainability.

***

Follow us on Facebook, Instagram and Twitter. Join me in Truly Rich Club, and together let us enjoy the financial and spiritual benefits. Found this article helpful? Share with a friend who might benefit as well.

Not yet a member? Join our growing subscriber base by clicking here. Absoutely for FREE!

May we all have richer lives!

Jollibee Buys Burger King Franchise

Is the Jollibee Champ now the Burger King? News went out last week that Jollibee Foods Corporation (JFC) has bought a majority ownership (54%) ownership or Burger King (BK) franchise currently run by BK Titans Inc. The acquisition was worth for Php65 million. The remaining 46% is owned by Lina (Air 21) and MVP (PLDT).JFC actually made a previous big acquisition of a grilled/ barbeque chicken chain, in the name of Mang Inasal late last year for Php3 billion while it already divested its interests in Mang Pepe earlier this year (which incidentally also serves chicken), supposedly to focus on bigger quick service restaurants.

The BK franchise meanwhile was previously owned by the Ayalas before it was sold to BK Titans. As such, its master franchise actually has been passed on locally from quite a number of owners already.Why is this? Either former owners lacked the expertise in the quick-service industry, or possibly back then the premium burger segment was not yet in growth mode.

Some people quoted that this move typifies the adage that if you can’t beat them, join them. Maybe on the part of BK this is the case, but I don’t think the converse holds true: that if you can’t beat them, buy them. I don’t think JFC and BK have the same target markets. Yes definitely there are overlaps in the target customers, but as JFC puts it, their entry into BK allows them to cater to the premium burger segment: in short to enter the expensive burgers market. A new market that perhaps, only their Champ burger is able to service.

As one newspaper put it, BK burgers sell at 30% higher prices compared toJFC burgers. In their disclosure, JFC expects the premium burgers market to grow as the Filipino standard of living improves along with economic growth. I sure hope so.

On the part of BK, this should mean better economies of scale and expertise in terms of operating a quick-service restaurant. Former owner Ayalas sold it to focus on what they do best: real estate, banks and telecommunications. I think this also holds true for now part-owners Lina and MVP since they also don’t have any other quick-service restaurants but there’s no doubt that they have successful telco, courier, mining, utilities businesses. And now, they get to ride on how JFC drives the BK machine. How good can it get for them?

For JFC, aside from a share in the premium burgers growth and possibly enjoying synergy as well in terms of processes, supplies and methodologies in doing burgers and other quick-service foods, it will also be beneficial in terms of expanding its network with yet another brand name (subject of course to franchise terms). Given that 54% of the franchise only cost JFC Php65.5 million, then it means that the whole BK franchise is valued at only Php121 million. The Php65.5 million acquisition is actually just 0.07% of JFC market cap as of today so it will be interesting how this acquisition moves their stocks in PSE.

JFC already has a very wide array of food businesses in and out of the country: Jollibee, Chowking, Red Ribbon, Greenwich, Mang Inasal, Caffe Ti Amo, Yonghe King and Hong Zhuang Yuan. Burger King is definitely a strong addition in terms of brand name. In terms of bottom line impact, it remains to be seen. In terms of local expansion for BK, I think there is still a lot of potential. In terms of international expansion (note that BK is a strong international brand), I don’t think this is covered by what JFC purchased.

Clearly, JFC is serious about its growth. While it is so big that the room for more growth is not that big already for its powerhouse strong brands (Jollibee, Chowking, Greenwich) (I think JFC is cognizant of this fact), JFC then focuses its efforts on growing internationally (especially in China) as well as doing key acquisitions on different but nonetheless related markets (Mang Inasal and Burger King). As of the disclosure, JFC stocks stand at Php84.40 per share, up by ~3%.

I am very much a Jollibee fan in terms of food, (burgers and chicken and spaghetti!) as well as their stock. It was able to double its share price in a span of 2 years (from sub-Php50s levels in 2009) given its huge size, and I think Php100 is a very big psychological ceiling and resistance, waiting to be breached.

Let’s see!

PS. I’m also a fan of BK but not as much as JFC since their burgers are more expensive. Used to take advantage of their refillable drinks though when I was a kid, but I think BK realized that unlimited anything in the Philippines will be maximized and somewhat abused by Filipinos, so maybe that is why they no longer offer that.

Related Articles:

http://www.pse.com.ph/html/disclosure/pdf/2011/pdf/dc2011-7046_JFC.pdf

http://www.bworldonline.com/content.php?title=Jollibee%20buys%20Burger%20King%20franchise&id=39196

http://www.philstar.com/Article.aspx?articleId=732608&publicationSubCategoryId=66

Successful Generic Brand Names

 I had a previous entry on successful business names, so successful that their names stuck as equivalent to the generic product, even if consumers are now buying the competing brands. I leave this up to you to decide whether you like this to happen to your products’ and company’s names (not to say that we actually have much of a choice).

 

In this post, I will dwell on seemingly generic business names that have succeeded in ingraining their names in the minds of consumers. Somewhat taking a different path from the previous entry, there are some products in the Philippine market that have used generic words as their proper brand names, and how the names have made a difference. I will dwell on two names here for brevity.

National Bookstore. If you are a foreigner first timer in the country, and you actually hear someone who will buy something from the National Bookstore, you might actually be amazed that the Philippines has a national bookstore, similar to having a national bird, national flower, national anthem etc. Then later on you find out that National Bookstore, is in fact a private company and not a bookstore declared as national by the government. Nonetheless, even if the bookstore is not a government-declared official national bookstore (I doubt if they will declare one anyway), the bookstore’s name connotes a certain “nationality” in it. In Filipino, “pambansa”, for the country, for every Filipino.

And the fact that National Bookstore is a run-away leader when it comes to book stores and school supplies store, many consumers have come to equate National Bookstore not just as the bookstore for all Filipinos, but as “the bookstore”. The default bookstore. Top of mind first option. No other bookstore compares. 

Standard Appliances. We all want appliances that meet the standard. If we can help it, we do not buy substandard products. So what is the best brand out there that has a high standard? What else but Standard appliances. The name they have chosen sets the bar high, sets the benchmark on how and what electric fans, rice cookers, flat irons should be. Especially during the time when Standard Appliances had the market leadership, I am sure that their name had a subconscious impact amongst consumers—that their appliances set the standard, and buying non-Standard appliances means you are buying non-standard products. Wise huh?

PS. In the recent years, we have seen the growth of specialty bookstores such as Fullybooked and Powerbooks. But these stores are for specialty books and items, but when it comes to generic book needs and school supplies, National Bookstore is still the top-of-mind brand for Filipinos. Besides, I think the three bookstores are sister-companies anyway. Correct me if I’m wrong.

PSS. So what will I name my business? The Business? TEC in Ayala actually stands for The Enterprise Center, and no doubt there are a lot of businesses offices in there.

 

No Honda or Mitsubishi Taxi Cabs in the Philippines

It is interesting to see how giant car manufacturers take different approaches regarding entering or staying out of the taxicab market in the Philippines. For this post, I’ll just consider the metered taxi cabs, and not the shuttles and vans registered under UV Express Services or GT Express (and the colorum ones).

We all know that a lot of taxis use the Toyota brand, and from time to time some Nissan, Hyundai and Kia. But in my experience, I have yet to see taxis using the Honda or Mitsubishi or Mazda brand in the Philippines. Do you also wonder why?

Toyota taxis are probably the most common to see plying our highways. From the old timer Corolla, Corona, to Vios, they even have Avanza. No Altis though or Camry or Innova as I think Toyota still sells these for private consumption. Hyundai Accent and Kia Pride or Rio taxis are also seen from time to time. We also have the classic Nissan Sentras.

On the other side, I haven’t ridden or seen any taxi cab that is a Honda City, Civic, Jazz or a Mitsubishi Lancer or Adventure. No Mazda 3s either (though I’d love to). So I take it to mean that these car manufacturers choose not to enter the taxi business lines.

As far as I know, the way it works is that taxi companies and operators enter into deals with the car dealers to buy bulk of their cars, to be transformed into their taxi fleets. So the presence of the car brand as taxi cabs (or the lack of it) is surely indicative of the car brands’ management decision. And likely included as a deliberate company strategy.

So why do other brands dominate the taxi cab business while others seemingly choose to stay out of it? I ask because to a mere observer like me, it is a big market that generates bulk sales, and as a company, I definitely want to have more sales. Based from 2009 revenues in the Top 25k Corporations in the Philippines (from CIBI), Toyota Motors Philippines is ranked top 20th in terms of revenue. Honda Motors is at 57th, Mitsubishi 44th, Nissan 603rd, Hyundai dealers 1000th++.

So given that brands who do not engage in the taxi business still generate healthy sales revenues, they surely have other sources where they get the sales from, to compensate their lack of presence in the taxi cab businesses. What are the other possible considerations anyway?

Again, as a consumer and observer who rides taxis every now and then, the first hand experience in riding the car gives me the impression of whether the car brand and design is durable, for heavy duty, affordable, spacious, sleek, beautiful inside, etc (though of course in my assessment I remove the add-ons done by the taxi company already). These things I get to see and experience, and I even get the opinions of the cab drivers, and in turn these will eventually help me decide what car brand to choose when I buy my own car. So this is a clear advantage for car brands with presence in the taxi business.

From my opinion, branding is also a crucial factor. Maybe, note just maybe, some car companies do not like their products to be branded as taxi-type cars. There is nothing wrong with it especially if taxis stand for durability, affordability, etc but this should be nonetheless be tied to the car manufacturer’s target market and overall branding strategy. If their target market is the middle class then perhaps there’s nothing wrong in allowing some products or so to be used as taxi fleets as well. But if the intention is to keep the image that their cars are for private use only (there are of course consumers who don’t want to buy car designs that are commonly used as cabs), then staying out of the taxi business line will prove to be a good move.

How about a hybrid of both, as Toyota, Hyundai, Nissan and Kia do it? Allot just a select line of car designs for both public and private use (likely the lower end ones) then keep the more high-end designs solely for private purchase.

As in life and applicable to business, to each his own. Whatever works. After all, not all competing companies are joining the bandwagon, unlike what we’ve seen in other industries where what others do will soon be imitated by the competition. Here in this post, it is clear that that is not always the case.

PS. I’m all for the durability and affordability, and if there’s flexibility that the car I want is not used for taxi cabs, I’ll definitely take it. But if none, same design but different color, plus some add-ons, will be fine as well.

PSS. I think in other countries there are Honda Taxi cabs. So I guess country / locations also matters.

Photo: “Taxi” by  Leonid Mamchenkov 

This work is licensed under a Creative Commons Attribution 3.0 Unported License.