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How to brand a consumer hardware startup

By Rob Coneybeer , written on June 29, 2013

From The News Desk

Branding a world-class consumer hardware company is dramatically different than for consumer software, Web, or mobile companies. Branding begins with storytelling, and crafting compelling stories for hardware requires a fresh perspective.

Why? What is the biggest difference between hardware and software products? Touch. The tactile interaction with a physical object generates an ongoing emotional connection with hardware that is uniquely suited to great branding opportunities. When you pick up a product, manipulate it, examine it, and hand it to friends, you connect with that product at a much deeper level than with software. The product is not confined to a screen -- it takes shape and form in the three dimensions of the real world. Getting that real-world interaction right is a huge opportunity for hardware startups to increase engagement, increase the prices they can charge, and radically lower the cost of new customer acquisition.

Building a leading hardware brand begins with a great product. Today's world-class hardware companies, like Apple and Nest, build products with several common characteristics. [DISCLOSURE: I am an investor in some of the companies mentioned in this article, including Nest and Ouya.]

1. They exhibit awesome industrial design. The product's textures, colors, sounds, and user interface are all exquisitely polished and compelling. The interactions are intuitive and pleasant to the end-user. Every interaction builds a positive emotional connection.

2. They serve unmet needs that matter. Everyone is familiar with what this means in the context of Apple's iPod and iPhone. For Nest, this is a beautiful thermostat that programs itself and saves users money.

3. They continuously improve after shipment. The product continues to improve, after adoption by the end-user, via software updates. Thanks to regular Internet connectivity, the device receives regular software updates (for free) that improve the product's capabilities on a regular basis.

If you get these three things right, your hardware product can generate a deep positive emotional connection with your end-users, and in turn, support compelling storytelling. The first two items are obvious to any recently minted MBA -- but the third item is fertile new territory: continuous product improvement post-shipment. What do I mean by this?

TiVo was one of the early pioneers of Internet-powered hardware. Using a built-in modem connected to a phone line, every TiVo box regularly updated its channel and program listings. But more intriguingly, TiVo boxes made regular system software updates that increased their capabilities. Today, every iPhone user gets iOS updates pushed to his device for free. And Nest has pushed out useful new features with software updates on a near-monthly basis.

So why does this matter? Because for the first time, physical products evolve and improve the longer you own them -- rather than degrading over time. This creates an ongoing word-of-mouth opportunity. Every new feature, assuming your customers perceive it as valuable, creates new opportunities for that customer to deepen his attachment to the product and share that with the world through word-of-mouth and social media.

Think about it this way. If you're a customer, and a product you purchased a year ago continues to improve every month for free -- aren't you going to love that? If so, won’t you talk about it without any prompting?

That’s what I mean about storytelling.

Then once you have built a great, continuously improving hardware product, make sure you make it easy for your customers to tell stories. This means having the right brand name. That name should encompass several "easy" attributes: easy to spell, easy to pronounce, and easy to recall. It should also have positive emotional connotations, ideally the name should be short, and sit in an uncrowded namespace. What it doesn’t need to do is describe the product -- that's what the storytelling is for. You want the brand name to be the perfect "handle" for the stories to come. Great recent hardware brand name examples include Jawbone, Nest, and Pebble.

Getting these pieces (emotional product + brand name) right allows a hardware startup to leverage social media in exciting new ways. Having a short name is critical for Twitter, Facebook, YouTube, and Instagram hashtags. For hardware companies, visual social media is particularly important. When consumers love your product due to a strong positive emotional connection, they will naturally post photos, video, and stories to social media.

You can also create materials that seed social media engagement. Nest created a video that explained how the product works that was widely shared -- but more importantly, it has built a strong social media presence that includes an active Twitter account. Using that account, and by actively engaging customers with at-replies, Nest points consumers at posts, pictures, and videos that all support key product messages. For example, is Nest easy to install? Just take a look at a customer-generated YouTube video of an eight-year-old installing a Nest thermostat at home... this type of marketing message wouldn't be possible without the right product foundation.

Of course, any company that embraces storytelling has to think about consumer motivation in social media. For hardware, this motivation falls into two categories.

First, there’s the #humblebrag. In social media, early adopters love to share posts and pictures about cool new products. Often the primary motivation is pride -- being the first to own or use a cool new hardware product.

Then there’s  #helpmyfriends. Here the motivation is significantly different. The basic consumer mindset is "…the product is so awesome that I want my friends to own it, too."

Focusing on the #helpmyfriends motivation is the difference between building a "hits business" and building a large, sustainable, scalable group of customers.  Every user should be proud of their hardware product ownership, and should want to introduce it to their friends -- either in social media or good old-fashioned, in-person, word-of-mouth conversation.

Tracking your Net Promoter Score (NPS) is the best way to make sure that every customer becomes a de facto salesperson for your product. The basic methodology tracks whether a customer is likely to recommend your product to others. The best hardware startups track every element of NPS: the purchase experience, the unboxing experience, the installation/activation experience, and of course, the overall experience. It doesn't just end with the NPS scores -- but with a deeper analysis of where the product and marketing gaps are that could be fixed and lead to higher overall end-user satisfaction.

But a word to the wise: Don’t do everything at once. Building a great brand requires storytelling that continues on for years. Every great story has a strong opening, but it also has a proper pace and tempo. In fact, the best stories have a tempo and intensity that gradually increases with time, which engages the end-user more and more.

Great hardware brands do the same thing, and it all starts with the initial product.