There’s a section of Pittsburgh, Pennsylvania, overlying the Strip District and Lawrenceville, called Robotics Row. Many are hailing this patch as the new tech mecca of Pittsburgh.

The impetus for this concentration of resources is Carnegie Mellon University. This world-renowned hub of computer science established the nation’s first undergraduate degree in artificial intelligence (AI) and located its National Robotics Engineering Center in Lawrenceville — for decades a run-down neighborhood.

Simply put, AI is software that rapidly sifts through large quantities of data to find patterns and draw conclusions. Increasingly, AI is able to find tumors in digital medical images (X-rays, sonograms, MRIs) that radiologists miss. AI determines whether you qualify for a credit-card or a mortgage.

Robotics encompasses the building of software-controlled mechanical devices that perform repetitive human tasks, often in hazardous environments. Robots fetch and package what you purchase from Amazon. Robots assemble, weld, and paint cars on assembly lines.

Now, the likes of Argo AI, Astrobotic, Bossa Nova Robotics, Carnegie Robotics, HEBI Robotics, IAM Robotics, Idelic, RE2 Robotics, Simcoach Games, and Voci Technologies grace the landscape.

One-Industry Towns Almost Always Collapse

Is this single-industry concentration, devotion, and ebullience wise? Will it benefit Pittsburgh?

In the short term, yes: It attracts technical talent and stimulates revolutionary business creation, both of which Pittsburgh badly needs.

History proves, however, that, in the long-term, it will backfire. Here are three key reasons:

First, technology is an ephemeral, transient means to an end — NOT the end. People repeatedly make the mistake of falling in love with a technology, only to find, often too late, that another one has replaced it.
 

Second, technology, per se, does not solve every problem. Robotics and AI, specifically, do not and will not solve every problem. Moreover, new technologies will supplant them. Alas, tech cheerleaders are blind to this.

AI, in numerous cases, has made customer service impersonal and mindnumbingly bad (read about my horrendous experience with Best Buy and SiriusXM). Too often, the AI engineers have little practical life experience.

Third, one-industry towns almost always collapse. Just as success in growing a financial portfolio requires diversification, so does success in growing a municipal one.

The Strip District, as my recent column explains, was once focused on wholesale produce. That business died in the 1970s, and the Strip along with it. Pittsburgh itself was once the steelmaking capital of the world, until it wasn’t. In the 1980s, steel mills closed, local businesses shuttered in response, and unemployment zoomed. The city, finally, is recovering, after 40 years of strife.

Peoria, Illinois, in the early 1900s, produced about one-fifth of America’s liquor. Liquor! What could go wrong? For one thing, 13 years of the Prohibition era. After Prohibition ended, Peoria was moribund and couldn’t restart. Caterpillar moved in, then out. The city never became what it once was.

Here’s a list of 10 one-industry cities that are now considered forever dead: Buffalo, NY (grain, steel); Flint, MI (cars); Hartford, CT (insurance); Cleveland, OH (rubber); New Orleans, LA (shipping); Detroit, MI (cars); Albany, NY (shipping); Atlantic City, NJ (tourism); Allentown, PA (steel, manufacturing); Galveston, TX (shipping, gambling).

Let not Robotics Row someday join this list.

Parting Advice to CEOs, Developers, and City Officials

Avoid falling in love with a technology, an ephemeral means to an end, and building what Brits call a monotown, a city devoted to one industry and/or one company.

The more people shout “robotics” from the rooftops, worship robotics, and single-mindedly recruit robotics companies to Pittsburgh, the more dependent the area becomes on a technology. Deja vu all over again.

Instead, build and cultivate a multidisciplinary area. Call it Revolutionary Row or Renaissance Row — unattached to the vagaries and vicissitudes of any particular industry, company, or technology trend.

Overall, Pittsburgh will benefit from Robotics Row, but only if this budding collection of startups is part of a larger portfolio of partially related and unrelated industries and disciplines — and doesn’t dominate the lot.

To paraphrase Edmund Burke: Those who either don’t know or ignore history are doomed to repeat it, thereby causing another cycle of massive financial ruin and unemployment. 

 

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of three books:
Intrabranding: The Keystone of Corporate Agility,
Brand Is Destiny: The Ultimate Bottom Line, and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

© 2020 Marc H. Rudov. All Rights Reserved.

A brand is an intangible, emotional connection between vendor and customers — not a product, a company, a name, or a logo.

Successful companies, by definition, are adept at branding — regardless of industry, size, age, era, customer type, or geography.

This axiom, of course, includes real estate: residential, industrial, and commercial.

Branding a new real-estate development, controlled by one company, is fairly straightforward: Glean the needs, desires, and emotions of carefully targeted potential residential and business customers, convert those elements into a pithy slogan, message it back to said constituents, and fulfill the brand’s promise through effective execution.

Rebranding and redeveloping an old parcel of land, however — with a history of different uses and drastic changes, and now owned, controlled, and redeveloped by multiple companies — has a different set of challenges.

 

Chaotic Redevelopment

Welcome to the Strip District, a bastion of chaotic, noisy, endless redevelopment.

One looks around at the constant excavation and asks, Which developer is doing what, when, for what purpose, and for how long?

These are not trivial questions.

Without a single, clear roadmap/timetable of impending transformation and disruption, from all the developers, the result can be alienation of current and potential customers.

A few months ago, I moved from California, where I had lived for two decades, back to Pittsburgh, where I grew up and graduated from Pitt’s engineering school. I landed in the Strip District to bunk temporarily in the new home of a relative, until I can figure out where I want to settle.

The Strip District may sound like an area of ill repute, but that isn’t the case. The appellation is literal: it’s a half-square-mile parcel of land in Pittsburgh, on the south bank of the Allegheny River, roughly 20 blocks long by three blocks wide.

 

 

Brief History

Originally called Bayardstown and privately owned, the Strip became part of Pittsburgh in 1837. With proximity to river, rail, and roads, this sliver of land always has been a launching pad for change.

US Steel, Westinghouse, Heinz, ALCOA, and Armstrong Cork Company (whose HQ is now a seven-story apartment building), and many other industrial companies incubated in The Strip — and still do.

In 1906, it became Pittsburgh’s center of wholesale produce, after railroad tracks were removed from downtown proper. People bought and sold produce right from railroad cars.

To centralize and organize the produce commerce, in 1926, the Pennsylvania Railroad built the five-block-long (to accommodate the length of freight trains), 155K-sq-ft Pennsylvania Fruit Auction & Sales Building, which became known as the produce yards and the Terminal Building.

From around the country, trains would stop at the produce yards to offload cars of fruits and vegetables. This produce would be auctioned off to the middlemen, like my grandfather, on the massive concrete trading/storage floor. Those middlemen, in turn, would sell the pallets of produce to local grocery stores and restaurants. Finally, from the Terminal Building’s 75 100’x21′ loading docks, trucks would pick up the sold produce to deliver to the new buyers.

 

 

The wholesale-produce business in The Strip was a hotbed of activity that eventually replaced heavy industry and displaced many residences. But, its utility lasted only about five decades, as the airplane and refrigerated truck rendered the middleman obsolete to retailers. Accordingly, this method of commerce peaked in the 1950s and ended in the 1970s. Conrail bought the building from Penn Central (railroad), which had gone bankrupt.

Enter the Buncher Company, founded in 1949 by the late Jack Buncher. The son of Russian Jewish immigrants who grew up in the Strip District, Buncher was a scrap dealer and became one of the largest landowners in Pittsburgh (e.g., he sold the land that became Three Rivers Stadium). In 1983, he bought the Terminal building, and 55 acres of land, from Conrail and sold it the same year, for $1.1M, to Pittsburgh’s Urban Redevelopment Authority (URA).

 

The Strip’s Transition

The Buncher Company, which at one time owned over one-million square feet of Strip District land, played a key role in catalyzing its transition and rejuvenation.

The Strip always had a smattering of eateries, grocery merchants, warehouses, and machine shops, but never looked particularly good. For many years, Buncher had envisioned investing $400M to transform the Strip into offices, shops, apartments, and homes, but political battles impeded execution.

Fortunately, the dream endured.

In 2004, McCaffery Interests of Chicago became the new general partner in the Cork Factory Lofts (formerly the 1901-built HQ of the Armstrong Cork Company). Charles Hammel III and Robert Beynon had purchased the buildings in a 1996 bankruptcy. The Lofts opened in 2006, followed by the marina and retail complex in 2008.

In 2007, Buncher built the Strip’s first hotel: a 143-room, eight-story Hampton Inn & Suites — a stone’s throw from the David L. Lawrence Convention Center (opened in 2003), across the river from PNC Park (Pirates) and Heinz Field (Steelers), both of which opened in 2001.

In 2010, Buncher reacquired the Produce Terminal, in a three-way real-estate swap with the URA, and ultimately sold it back (again) to the URA in 2014, for $675K.

After that, the Terminal was home to a revolving door of merchants, who set up stands and storefronts to sell their wares to the public, as seen in the Tribune-Review photo below from December 2012.

 

 

In April 2016, Oxford Development opened a 300-unit apartment building called The Yards at 3 Crossings, managed by Chicago-based McCaffery Interests, followed by the Stacks at 3 Crossings in 2018.

Cleveland-based NRP Group LLC, in 2018, opened phase one of the 443-unit, upscale Edge Apartments, on the Riverfront Landing development owned by Buncher Co. NRP began building phase two in January 2020 — causing a 29-month shutdown of a five-block section of Waterfront Place (see photo below).

Also in 2018, Buncher sold to Laurel Communities four parcels of land, at $405K, adjacent to the Terminal building, for 46 brownstone-style townhouses. Each is selling for almost $1M.

Talk about turning crap into gold!

In the spring of 2019, after five years of negotiation, McCaffery secured from the URA a 99-year lease, for $2.5M, on the Produce Terminal. McCaffery is expected to invest upwards of $50M to revamp it as an upscale panoply of shops, cafes, and offices. The new Terminal is scheduled to open in August 2020.

McCaffery also bought the former warehouse across the street from the Terminal, at 1600 Smallman Street, to convert it — for another $50M — into, you guessed it, offices and shops. The city will spend $23M to revamp Smallman Street, which currently is pockmarked with axle-damaging potholes.

 

 

 

Pros & Cons

The Strip is now home to a slew of tech-based companies — Apple, Argo AI, Aspinity, Aurora Innovation, Blue Belt Technologies, Bosa Nova Robotics, Branding Brand, Facebook, Honeywell, Robert Bosch GmbH, Uber’s Advanced Technology Group (self-driving cars), Voci Technologies — as well as Oxford Development, Rycon Construction, and the Burns White law firm.

The list of developers jumping into the Strip District Gold Rush is growing and causing massive disruption. At every turn, there’s a new project under construction. Constant noise and dirt, and road closings without warning. Shoppers descend every weekend, making Penn Avenue look like the Santa Cruz boardwalk — with a paucity of parking spaces to accommodate all the cars.

Alas, there’s no concerted effort from developers to communicate the roadmap/timetable of transformation — making living, working, and shopping here unsettling.

Don’t get me wrong: Stimulating business growth is imperative in Pittsburgh, which is in dire need of it.

I heard Gus Faucher, PNC’s chief economist, tell two business audiences in as many days, in January 2020, that Pittsburgh and Pennsylvania lag the rest of America in GDP growth. His October 2019 edition of “The PNC Economic Outlook,” focusing on small and mid-size business owners in Pennsylvania, stated this: “Pennsylvania has one of the slowest-growing populations in the country.”

Growth is good. Growth is positive. Growth is mandatory. But, if the growth reduces the quality of life, it will repel and alienate residents and businesses. People can tolerate a certain degree of reasonable inconvenience, in a reasonable timeframe, if they know what’s coming down the pike.

Unreasonable inconvenience? Protracted timeframe? Not so much. And, nobody likes constant surprises.

On January 23, 2020, in a conference room at the Burns White law firm, I attended a town meeting of 100 concerned Strip District residents and business owners, who were there to hear real-estate developers give updates about the future of the “neighborhood.”

After listening to the presentations, I asked two questions:

Is the Strip becoming less neighborhood and more Downtown Pittsburgh 2.0? How long will the disruptive construction last — five, 10 years?

Apparently, my questions, which nobody answered, resonated. Shelby Cassesse of KDKA TV interviewed me afterwards to get my opinions on the air. I’m certain I was expressing the concerns of many.

At the meeting, we learned that 21st Street would be closed for two weeks while the Terminal Building connects to city water and sewage. Guess what: It’s going to be at least four weeks. Surprise!

 

 

Prior to the town meeting, in late December 2019, we learned on local TV news that five blocks of Waterfront Place would be closed for 29 months, so NRP can build phase two of the Edge Apartments. That’s 2.5 years. Surprise!

 

 

 

Parting Advice to CEOs

If you build it, will they come? So far, that’s been the case. But, as new waves of people move into the Strip District and experience the uncoordinated chaos, that will change.

More people, same roads — frequently closed without warning — means more congestion and frustration.

Bottom line: chaos and poor communication ruin relationships — personal and business — and, therefore, brands.

As stated in the first paragraph, a brand is an intangible, emotional connection between vendor and customers. In the Strip District, there is no single vendor (there are multiple vendors), so there is no brand — other than chic for intrepid outsiders, who hear that the Strip is “lit,” and chaos for insiders, who hear jackhammers and backhoes’ back-up beepers all day long.

I have it on good authority that the disruptive construction in the Strip District will last for 15 years. 15 years! I am, perhaps, the only resident who knows this. The developers are not handling this situation properly. They can, but they’re not.

Remember: ROI and alienation don’t mix.

It’s laudable that the developers are creating something special from a scrap heap. But, if they build too much, too fast, too disruptively, too chaotically, too noisily, and too secretly, the current lure of the Strip District will fade.

I recommend that, despite being competitors, all the developers work together by forming or hiring a single entity, and creating a single website, to convey a constantly updated roadmap/timetable to the residents and businesses of the Strip District.

Branding by committee doesn’t work. Giving separate interviews to the press won’t cut it.

Rebranding the Strip District can succeed only if one, unified supply-side entity manages it, and if the demand-side constituents are enjoying and benefiting from the changes — and recruiting others to locate here.

 

POSTSCRIPT #1: JMC Holdings to Build 21-Story Office Tower at 1501 Penn Ave (02.20.20)

POSTSCRIPT #2: Mayor Peduto Objects to Architecture of JMC’s Proposed Building at 1501 Penn Ave (02.25.20)

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of three books:
Intrabranding: The Keystone of Corporate Agility,
Brand Is Destiny: The Ultimate Bottom Line, and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

© 2020 Marc H. Rudov. All Rights Reserved.

Many companies, especially large ones, have difficulty innovating.

Is this a surprise? It shouldn’t be.

In my experience, the left and right hands of most enterprises have never met.

There isn’t even a universal definition of innovation, let alone what it entails.

Putative experts have written volumes of scholarly and not-so-scholarly books and articles on this subject — some so complicated they muddy the waters.

In addition, there’s an obsession today in many precincts to disrupt, disrupt, disrupt. Who likes disruption? Other than venture capitalists, nobody. Customers hate it. Divorce is disruption. Rioting is disruption. Disruption is painful.

In general, people like and will embrace gradual change. Gradual change is manageable. The key to successful innovation is diligently maintaining a steady rate of incremental change.

Disruption, however, is the bane of innovation: it focuses on output, one-upmanship, and industry dynamics — and not on customers.

Background

Innovate is derived from the Latin innovare: to make new. That said, making something new isn’t necessarily an innovation.

Let me repeat that: Making something new isn’t necessarily an innovation.

Unless the “innovator” has improved the lives of customers, according to those customers, the new offering is not an innovation. Without a formalized means of assessing customer satisfaction (excluding bogus social media), innovation is impossible.

NOTE: This axiom applies, regardless of company size, to every industry and every customer category: military, industrial, scientific, commercial, financial, consumer, etc. Violate it at your peril.

The Dilbert strip below illustrates this point perfectly. 

Take the use of artificial intelligence (AI) in customer service. Many in Corporate America blindly and blithely accept AI as an innovation — because it’s in vogue and allegedly saves money by shortening process time and replacing humans.

But, when the impersonal, enervating, alienating experience induces the customer to yell at store clerks and telephone techs, waste his time, despise the supplier, and abruptly hang up the phone (read “Best Buy? You Cannot Be Sirius!”) on clueless idiots, AI is not an innovation.

Amazon.com’s Alexa is a well-known consumer-based example of AI, a supposed innovation for the masses. By issuing voice commands, Alexa’s owners query the temperature, request music selections, set reminder alarms, and switch on and off their appliances.

Is Alexa improving their lives?

Despite becoming lazy, addicted slaves to Alexa, the majority of owners likely would answer in the affirmative — even though Amazon remotely records (spies on) their conversations, sex, you name it. Oddly, upon learning about the spying, most owners express temporary shock, shrug off their dismay, and continue their habitual enslavement.

Count me out: Alexa will not improve my life; I’ll never own one.

The Branding-Innovation Cycle

When innovating, the fundamental question becomes: What new/tweaked offering should we produce, for whom, and why?

Your brand — the emotional connection customers have with your company, that which provides your company purpose and direction — answers this question. I explain this in more detail in Brand Is Destiny: The Ultimate Bottom Line.

Without knowing what your customers want and need, and how they feel about your company — and lacking the concomitant purpose and direction that a strong brand confers — you can neither hatch nor improve an offering (product or service) with success.

Moreover, even if you have crafted a strong brand, innovation demands execution.

The inability to marshal and coordinate the requisite internal and external resources — from marketing to sales to finance to engineering to manufacturing — will stymie, and possibly nullify, your innovative efforts.

Furthermore, if your product or service is a unique standout, it may be beneficial to patent and/or trademark it. Tread carefully here, because not all products are worthy of patenting or trademarking.

Finally, you must be able to verify that your company’s innovation is, in fact, an innovation: it improves the personal or business lives of your customers, according to them.

These steps are depicted below in a five-step, continuous branding-innovation cycle.

Parting Advice to CEOs

Innovation is a neverending process, dependent on a strong brand for clear purpose and direction. Without a clear purpose and direction, understood and endorsed by all employees at all levels, what and how and why are you innovating?

Building a strong brand means knowing and revering customers — and communicating to them in their language.

Never assume that, to innovate, your company must crank out a new product or an iteration of an existing product. That may or may not be true. Sometimes, all that’s necessary is a small tactical improvement to customer responsiveness, involving no technology.

If disruption is your obsession, stop. Customers and innovation hate disruption.

Successful innovation always drops to the bottom line.

POSTSCRIPT #1: Ivanka Trump Says Innovation Is Key to Job Creation (09.23.19)

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of three books:
Intrabranding: The Keystone of Corporate Agility,
Brand Is Destiny: The Ultimate Bottom Line, and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

© 2019 Marc H. Rudov. All Rights Reserved.

Every company, no matter its size or industry, feels compelled to construct a mission statement — but rarely obligated to create a brand.

Some also craft a “vision” statement. More time-wasting nonsense.

Many believe that the mission statement shapes company direction and rallies the troops. It does not.

Typical creation process?

Form a buzzword-happy, politically correct committee. Google boilerplate examples. Attend seminars. Read white papers. Hire a consultant. Copy and modify competitors’ nebulous blatherings.

RESULT: Useless, generic, internally oriented, forgettable, uninspiring gobbledygook.

If you want to learn whether employees have any clue about their company’s purpose and direction — THAT is what a brand defines — and whether they’re on the same page and marching in unison, make a purchase. Then, call customer service when the process goes awry (read about my personal customer-experience nightmare in “Best Buy? You Cannot Be Sirius!”).

What you’ll discover, after encountering a problem, is that the vendor’s left and right hands have yet to meet — certifying a lack of corporatewide buy-in of purpose and direction. Yet, this supplier has a mission statement, and maybe a vision statement.
 
Functional and Operational Jargon

Let’s examine the mission statements of the top-two companies on the 2019 Fortune 500 list: Walmart and ExxonMobil, respectively.

Walmart’s mission statement: “to save people money so they can live better.” Walmart’s brand, expressed in its tagline: Save Money. Live Better.

A rare example of the mission statement and brand being identical. And, it’s customer-focused, concise, memorable, meaningful, and repeatable. It reflects what Walmart’s customers desire, in their language.

A more-common example is ExxonMobil’s mission statement: “ExxonMobil is committed to being the world’s premier petroleum and chemical manufacturing company. To that end, we must continuously achieve superior financial and operating results while adhering to high ethical standards.”

Functional and operational jargon. Nothing about customers. I guarantee that no ExxonMobil employee can remember this committee-derived, meaningless, generic pablum and won’t even try.

 
Unifying Force

The only way to rally your employees to march in the same direction, to work as a team for a single purpose, is to create and articulate a brand, as Walmart did. A brand is a concise, memorable, repeatable, customer-validated value proposition, expressed in customer language.

WARNING: If you ask your employees to memorize and internalize multiple statements (brand, mission, vision), they’ll ignore all of them and work according to their own agendas. Ring a bell?

As I’ve written ad nauseam, the brand, if it’s effective, drives every activity at your company. It dictates the people you hire, the processes you implement, and the products you build.
 

 
A strong, effective brand unifies the enterprise. It puts all employees, in all departments, on the same page. It distills all corporate communications into a single message, or pitch, for all constituents — ending the usual internal and external confusion and conflicts.
 

 
Parting Advice to CEOs

Ditch your mission statement — and your vision statement, if you have one. Each is a useless corporate cliché that nobody will recite, remember, or adopt.

Multiple messages disorient your employees, confuse investors and reporters, and muddle your true mission: to magnetize your customers.

What matters is your brand, the emotional connection customers have to your company.

If your brand is weak or nonexistent, fix it — yesterday.
 

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of two books:
Brand Is Destiny: The Ultimate Bottom Line and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

 

© 2019 Marc H. Rudov. All Rights Reserved.

At every opportunity, I’ve asserted verbally or in writing that a logo isn’t a brand and that creating a new one isn’t rebranding.

REMEMBER: A logo can represent a brand but never constitute one.

In my May 2018 column about Best Buy’s new logo, “Best Buy’s New Logo Isn’t a Brand,” I opined that the $43B retailer had erred by claiming that a graphical change conferred “magical” transformational qualities to its operations:

According to Whit Alexander, newly minted chief marketing officer, “It’s [replacing the old logo] really about building more aggressively toward serving customers and helping change lives with technology.”

Name one time in world history when a company improved its customer experience by designing a new logo. You can’t.

Fast-forward to May-June 2019, when my personal encounter with Best Buy and its partner SiriusXM, which has undergone a series of its own logo changes, validated my contentions of a year ago.
 
Nobody Answered the Phone

Wanting to add SiriusXM capability to my low-mileage, almost-two-decades-old Jeep Grand Cherokee, I had to replace its factory-installed radio with a modern one. After doing some phone and Internet research, I chose to do this at Best Buy.

Because my local Best Buy no longer performs car-audio installations, I drove 30 miles to the Pleasant Hill, California, store to purchase the appropriate hardware and arrange the installation, scheduled for June 17th (three weeks hence). The hardware was to be delivered and stored at Pleasant Hill for the installation.

Afterwards, anticipating a likely out-of-town trip on June 17th, I felt uncomfortable with such a long wait and wanted to reschedule the installation for as soon as possible.

After numerous tries and unacceptably long holds on the phone, I finally reached guy at Pleasant Hill and asked him to change my appointment to June 6th, if possible. Yes, it’s possible — at the Dublin store. He told me that I’d receive an email confirmation within 24 hours. That didn’t happen. When I called Pleasant Hill to follow up, nobody answered the phone. Nobody.

I decided that, if I couldn’t finalize things in person, face-to-face, it wouldn’t happen.

So, I drove to the Dublin store, 30 miles in a different direction. I demanded to see the manager of the store. He looked at the installation schedule and showed me that I was indeed scheduled for installation at his store on the 6th, arranged by Pleasant Hill — July 6th. July 6th! I wanted sooner, not later, and exploded with rage. What kind of bullshit operation do you folks run? I thundered. He apologized profusely and walked me over to his car-audio department, where he assured me that his guys would take care of me.

These Dublin guys broke the news to me: If I wanted installation earlier than July 6th, I’d have to go to the Tracy store, where they could schedule me on June 7th. Of course, I took it. It’s 20 miles away in a completely different direction. Hey, this is California.

One of the sales associates at Dublin told me that I could have avoided this entire mess, had I come to see him in the first place, because he knows how to make things happen. Really? How could I have known that; I had never heard of him before. He gave me his business card with phone extension and email address, and instructed me to contact him if I needed anything henceforth. He then twisted my arm, against my wishes, to agree to have all the hardware shipped to me, so that I could take it to Tracy.

Why can’t the hardware just appear at the installation site, without my involvement? Because Best Buy is too incapable of pulling it off, obviously. Subsequently, I tried multiple times to reach that sales associate by phone and email, to get a tracking number for the shipment, and never heard back from him. Never. Fortunately, I received all the hardware. Miracle.
 
You Cannot Be Serious!

Starting a week before my June 7th appointment in Tracy, I called there a few times to reschedule earlier, in case of cancellations. There were none. But, the installation guys answered the phone every time and were highly courteous and professional.

I showed up a little early on June 7th for my appointment in Tracy, and the installation guys were waiting for me. No problems. No incompetence. Before leaving the Best Buy premises to stroll around the mall for two hours, the manager encouraged me to call SiriusXM to activate my radio — so that I could get that hassle out of the way beforehand.

Ever the lover of efficiency, I heeded his advice. The SiriusXM autoattendant informed me that too many callers were in the queue and that I could choose online support, which I did. After wasting 15 minutes with the bozo who ultimately admitted she couldn’t help me, having given her my updated address, radio ID, and other pertinent information, I called back and waited for someone to talk to.

The live SiriusXM support person apologized for my wasted time online and then proceeded to take all my information again — because the online woman recorded none of it — and promised to activate my radio and grant me the free 90-day subscription, available to all new radio owners.

Naturally, I thought I was done with SiriusXM.

I returned two hours later to find my car nearly completed. After a few more steps, the installation guy backed it out of the garage and showed me a few features of the new radio. I couldn’t get SiriusXM to work. So, the manager came over to help me. Nothing.

I called SiriusXM again. Guess what? The third person informed me that she had none of my information — and that’s why my radio wasn’t activated. You cannot be serious! I literally yelled into the phone, like John McEnroe, with Best Buy’s car-audio manager sitting right next to me. I had to repeat everything about myself, as well as the radio ID.

Then, she asked me if I was aware of a $15 activation fee. What???? Since when does free mean $15? OK, I’ll waive that fee. At this point I am beyond seething, and the Best Buy guy, still sitting next to me, didn’t know what to make of it.

Are we finished now? No. Ms. Sirius insisted on reading to me the terms and conditions. No, no, no! I screamed. I accept all of them! Skip this step. Too bad. She told me she is required to read the T&Cs. No, I demanded. I want to talk to your supervisor.

Ms. Sirius then claimed that her supervisor would likewise force me to sit through the recitation of the T&Cs. Uncle! Just read them, dammit, I relented. I can’t take this bullshit anymore. This is supposed to be easy!
 
More the Rule Than the Exception

Finally, after expending all of my patience, and stomach acid, I drove home with my operable SiriusXM-enabled radio.

Alas, the horror wasn’t over.

Before going to bed that night, I received an automatically generated email from Best Buy: Sorry you missed your installation appointment today. Would you like to reschedule?

Huh??

Even though the crew had spent two hours installing my new radio, including the steering-wheel controls, the Best Buy computer had no record of it. Wow. If you assumed that I fired off a terse email in response, you’re correct.
 
Addendum

Remember my original July 6th installation date at Pleasant Hill, which I ultimately changed to June 7th at Tracy? Well, Best Buy’s dependable computer system, one week in advance, emailed me a reminder to show up on July 6th for my installation.

Finally, on the evening of July 6th, Best Buy’s computer sent me an email expressing regret that I had missed my appointment in Dublin earlier that day — even though my installation happened on June 7th, in Tracy, a month prior to that.

ALERT: More technology does not mean better customer experience.
 
Parting Advice to CEOs

To say that Best Buy and SiriusXM crapped on me is an understatement.

I guarantee that James Meyer, the CEO of SiriusXM, and Hubert Joly, the CEO of Best Buy, know nothing about my disaster, which is more the rule than the exception.

No customer should endure my awful saga with Best Buy and SiriusXM. Ever. Inexcusable.

You want to avoid this in your company?

Manage by walking around. Talk to customers. Otherwise, you know nothing about how your company functions, how you’re wasting shareholder cash, and how employees are killing your brand through rudeness, incompetence, and poor processes.

Never design a new logo, thinking that you’ve juiced your brand. You haven’t.
 

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of two books:
Brand Is Destiny: The Ultimate Bottom Line and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

 

© 2019 Marc H. Rudov. All Rights Reserved.

The Golden State Warriors, a championship NBA team in Oakland, California, are in a terrible slump.

Steph Curry, the team’s point-guard superstar, just rejoined the roster after missing 11 games from a groin injury. Draymond Green, another star, is out with a toe injury. On Curry’s returning night, despite big hope, the Warriors lost 111-102 to the Detroit Pistons.

In January of this year, JPMorgan Chase, America’s largest bank, won the naming rights to the new arena in San Francisco, where the Warriors will move in 2019 or 2020.

The current, and soon-to-be-abandoned, venue of the Warriors, in Oakland, is called Oracle Arena. If naming rights were a good investment, Oracle Corporation would have fought to name the new arena.

Faulty Logic

Reportedly, Chase will pay the Warriors $15-$20 million per year, for 20 years, to have its corporate logo emblazoned on the new arena.

Why?

The usual “logic”: naming a stadium strengthens a corporation’s brand.

Does it?

First, there’s zero empirical evidence to support that. The same “logic” is applied to funding Super Bowl commercials, which sell no products. Nevertheless, as I detail in Chapter 15 of Brand Is Destiny, CEOs, every year, waste shareholders’ money on Super Bowl TV spots.

After inking the Warriors deal, Chase CMO Kristin Lemkau called the Warriors the “hottest team and one of the hottest brands in sports.” She added, “Our strategy is to have big arena assets that can work for both sports and entertainment in key markets. If ever there were a city and a team we would aspire to, it would be San Francisco and the Warriors.”

What happens when a vaunted team is in a slump, as the Warriors are as of this writing?

Even when an embattled team snaps out of its slump, as the Warriors inevitably will, other players will get hurt — and even leave the team or retire. Do corporations really believe any athletic team will be on top forever? Is any corporation on top forever?

Second, branding is not about awareness; it’s about connection.

People are aware of many names of companies and products, but such awareness doesn’t motivate them to purchase anything. People are aware that they should exercise regularly and eat properly, yet almost 75 percent of American men and more than 60 percent of women are obese or overweight.

Awareness does not stimulate action.

Many times, I’ve discussed the idiocy of GEICO commercials with friends and colleagues (GEICO has an awareness strategy — which is why you see the spots 100 times every day). The usual reaction I get is, “Oh, those commercials make me laugh.” Then, I ask them if they’re GEICO customers. I’ve yet to hear, “yes.”

Ego & Bragging Rights

So, what’s the real reason that CEOs make 20-year commitments to pay big bucks to name stadiums and arenas? Ego. Bragging rights.

Per Sports Business Daily and other sources, here are some top naming-rights deals:

Sports Marketing Analytics (SBRnet) studied this issue and discovered — surprise (not) — that at least half of NFL, NBA, and MLB fans don’t care about stadium names.

Translation: All that shareholder dough paid for awareness is wasted.

Darren Rovell, who has been with ESPN and CNBC, said this about the ability of naming rights to persuade fans to buy the underlying products and services: “It’s a step that not a single company that has ever landed naming rights has ever accomplished.”

Parting Advice to CEOs

There’s only one reason to spend money on promotion: to sell products. Naming a stadium doesn’t accomplish that. It’s a waste of shareholders’ capital.

Stop getting stars in your eyes. Stop seeking the limelight. Take your ego out of this asymmetrical equation.

Use your precious capital to beat your competitors, not yourself.

POSTSCRIPT #1: Oracle Wasting $200M to Name Ballpark for San Francisco Giants

POSTSCRIPT #2: Naming Rights for Pittsburgh’s Heinz Field & PNC Park About to Expire

POSTSCRIPT #3: Future of Golden State Warriors in Serious Limbo 06.14.19

POSTSCRIPT #4: Kevin Durant, NBA Superstar, Is Leaving the Warriors 06.26.19

POSTSCRIPT #5: Empower Retirement Wastes Money Renaming Stadium of Denver Broncos

POSTSCRIPT #6: SoFi to Waste $400M on LA Stadium for Rams & Chargers

POSTSCRIPT #7: Super Bowl 54 in 2020 to Be Played in Miami’s Hard Rock ($250M for 18 years) Stadium

POSTSCRIPT #8: Rudov on KDKA Radio to CEOs: Don’t Fund Super Bowl Ads & Name Stadiums (01.29.20)

 

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of three books:
Intrabranding: The Keystone of Corporate Agility,
Brand Is Destiny: The Ultimate Bottom Line, and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

Many CEOs of public companies complain privately that equity analysts control their companies’ brands and branding strategies.

This is a legitimate complaint.

Equity analysts — who tend to be biased, myopic, and flamboyant — are extremely influential with investors.

The result is that these CEOs, fearful of criticism, frequently keep secret their future visions and often forgo executing the underlying strategies to convert those visions to reality.

This means that the analysts, not the CEOs, are calling the shots — and this is unacceptable.

Fortunately, there is a solution.

Previously, I recommended the cessation of giving quarterly guidance: first, it’s part of the analyst-control problem; second, it is not legally required.

I recognize that stopping a traditional, expected ritual like guidance is more easily said than done. But, you’ll agree, I’m sure, that allowing outsiders to control your destiny is no way to run a company.

Moreover, keeping customers in the dark about your company’s direction can negatively affect the prices they’re willing to pay for your products and services — thereby impacting your top and bottom lines.
 
Passively Dancing

According to researchers, star analysts — but not “regular” analysts — not only affect stock prices but also the costs of and timetables for raising capital.

According to Boivie, Graffin, and Gentry: We found that a downgrade by a star analyst causes tremendous stock valuation changes that are not offset by the CEO having a good reputation. In other words, star analysts’ reputations overwhelmed those of the CEOs they were covering in terms of shareholder reaction – even when star analysts downgraded firms run by star CEOs. Specifically, we found that a downgrade by star analysts increased the negative market reaction by 40%, regardless of a CEO’s reputation. Thus, when a star analyst issues a downgrade, the CEO’s reputation has almost no effect on the market reaction.

Chen and Lu drew similar conclusions in China: Sell-side financial analysts play a key role in collecting, interpreting, and disseminating company and market information to investors. Issuing “buy” and “sell” recommendations is an important part of an analyst’s job and one of the most visible ways for them to express their opinions on the stocks and markets they cover. In an information market such as the one of financial analysts, since the product is ex-ante hard to evaluate, investors may reply on outside certification, such as award-wining status of an analyst, to infer the quality of his or her recommendations. In line with this argument, a large body of literature in finance and accounting have documented that investors react abnormally more to stock recommendations by award-winning financial analysts (hereafter “star analysts”) than those by other analysts.

Canadian economist François Derrien asserts: Not only do analysts influence the price of shares via their investment recommendations and reports, the information they provide also directly affects the cost of the capital of the firms they cover and, more indirectly, their financing and investment decisions.

Dos Doszhan, CEO of Stockmetrix, avers: Active trading based on the Wall Street analysts’ recommendations regarding the S&P500 companies turned out to be more profitable than [Warren] Buffet’s passive investing approach. It seems like you can trust the analysts after all.

In essence, the aforementioned paints a picture of CEOs passively dancing to the tunes of equity analysts, who have gained too much power — power devoid of checks and balances! This unfortunate situation has occurred over time, is counterproductive, and must end.
 
Parting Advice to CEOs

Surrendering to star analysts is not a solution for controlling your company’s brand and, therefore, its destiny.

I recommend emulating Donald Trump and Elon Musk, without the chaos: Circumvent the analysts, legally and wisely, by communicating directly with investors and customers — frequently and compellingly.

Twofold objective: demonstrate your company’s unique value and put the analysts on defense.

Build a TV studio at your headquarters. Make noteworthy status videos for your website. Provide live and taped video tours of your plants. Conduct interviews with happy customers. Use your imagination and creativity.

In other words, change the game.

Ideal scenario: Analysts are still involved but no longer in control. You are in control.

Or, you can continue your private griping about life as a marionette.
 
POSTSCRIPT #1: SEC Forces Elon Musk to Relinquish Chairmanship Over Tesla Tweet

POSTSCRIPT #2: Irate Cleveland-Cliffs CEO Shows How NOT to Deal with Equity Analysts
 

About the Author

Marc Rudov is a branding advisor to CEOs,
producer of MarcRudovTV, and author of two books:
Brand Is Destiny: The Ultimate Bottom Line and
Be Unique or Be Ignored: The CEO’s Guide to Branding.

 

© 2018 Marc H. Rudov. All Rights Reserved.