As a former philosophy major, I am fascinated by the business of brands. They bring about the postmodern day quest of tackling one of the oldest philosophical conundrums by asking the question, “What is real?” Is the product the reality or is the brand? Is what exists on the store shelves the brand, or is it the idea of the product that lives in the consumer’s mind?
It’s a debate as old as the ancients.
In presentations I give, I often refer to brands as software and products as hardware. Brands are the brains. Products are the arms and legs. Products you can touch and bang around. Software is like the mind. It’s ephemeral, invisible.
While a company can make many products and those products can vary, (PCs, Tablets, Cell Phones, etc.), their needs to be a (CPU) central processing unit that makes all of its parts connect, make rational sense and provide it a soul.
Given this historic dichotomy, when high-tech titan Hewlett-Packard recently announced they are getting out of the hardware business, some saw it as simply a practical economic decision. After all, the group’s profits from that business are only a mere 13%.
But look closer and something else is going on. Their move follows a muddled, hurly-burly, zig/zag pattern unable to sync up mind and body.
Earlier in the decade, H-P made a monumental meal with a merger to Compaq Computer so it could get into the PC business. Then, in 2008, it ate Electronic Data Systems (EDS) and soon after swallowed Palm entering mobile and last year gobbled up 3Com Corp. Furthermore, their latest announcement comes on the heels of their recently purchased U.K. software and data analysis company, Autonomy.
In a recent article from the Wall Street Journal bluntly titled, “Hewlett-Packard to Computers: Drop Dead”, it opines that H-P, a company with a rich electronics history dating back to the Great Depression has lost faith in the personal computer (that goes for tablets, and Palm-made cell phones too.)
But with such a diet, no wonder H-P’s stock has keeled over.
What is the mind and soul of the H-P brand—hardware, software, networking, mobile? Where’s its head? What’s it stand for?
With a down economy, fierce category killing rivals like the iPad and a broader move away from PCs to cloud computing, their CEO Leo Apotheker heaved. After such a shmorgishborg, I’d be so queasy, I would too.
To get over the hangover, H-P plans, like IBM did seven years earlier, to get out of the PC biz and move into the more profitable world of consulting.
If it says focused, doesn’t mix up the menu, stays true to its core, then okay.
The key here is that to succeed, the mind (the brand) has to concentrate and lead, while the body needs to stay lean and fit.
Philosophically, I’d liken it to mind over matter. So too for business, it’s brand over product.
Abe Novick is a writer and brand consultant and can be reached at abe@abebuzz.com.