The Landmark Aviation story
By Hans Ullmark, Founder and CEO at Collaborate and a member of Gerbsman Partners Board Of Intellectual Partners.
How much is a brand worth - just the brand itself - in actual dollars. This rather unusual story provides an answer.
A few years ago three aviation services companies came together under new ownership to form a new company, Landmark Aviation, with sales of around $750M. All three founding companies had long histories in the aviation industry, with their own distinct corporate cultures and business processes.
Landmark Aviation's new management team was faced with lots of practical challenges, and two big questions, namely, "How do we turn these diverse companies into a single organization with a common purpose and business focus?" and "How do we create a single, sustainable brand?"
Fortunately, they had the foresight and wherewithal to address these questions in a deliberate way, both internally and externally. They knew that a strong brand would not only help get business off to a flying start (pun intended), but that it would also help the company command a higher acquisition price, in the likely event that it were to be sold sometime in the future.
In order to create a brand strong enough to transcend the three founding brand names, along with their combined 150 years of heritage in the industry, the marketing team employed an approach we call "brand-led change." It's designed to help accelerate the growth of brand asset value for companies going through disruptive transitions such as mergers, acquisitions and new leadership, and it consists of the following steps.
Step 1: Know the brand's strengths, and the competition's relative weaknesses.
The first step was to conduct qualitative research, both internally and externally, to provide management with actionable insights, rather than the typical overload of abstract data that traditional research companies tend to offer. The results gave management the tools to define both a customer-driven service offering, and a unique brand positioning.
Step 2: Provide a compelling vision.
Internally, people wanted to know what the common purpose of the new, "merged" company would be. The vision was expressed as: "We are dedicated to enhancing the ownership and operating experience for every customer."
Step 3: Start internally, then go externally.
Before any marketing and sales activities were put in motion, management launched an internal program called "Living the Vision." It introduced the new company and the new brand to Landmark Aviation's 2,400 employees in 35 locations across North America. As a result, the new organization entered this fiercely competitive field (a handful of well-established service providers fighting for market share) with highly motivated employees, clear on their goal of becoming the country's leading aviation services company.
Step 4: Retain existing customers.
Along with creating the new brand came the necessity of demonstrating to existing customers that the new entity was stronger than it had been before, and was relentlessly focused on bringing more value than its competitors.
After the launch of the new brand, Landmark helped minimize confusion by clearly communicating that the services offered were just what the customers had asked for. Many of the airport operations, the so-called FBO terminals, were re-designed and upgraded. The resulting feeling -- of a fresh, new company backed by extensive experience -- resonated with customers, who overwhelmingly stayed with Landmark.
Step 5: Win new customers.
Confident of retaining existing customers, Landmark set out to win new ones, reaching out to nearly all their constituents via a broad-based marketing effort that included a strong web presence, print advertising, direct marketing, an impressive trade show calendar, local events, sales tools, an active PR agenda and branding at over 30 airports around the country. The rather traditional and conservative aviation services industry was unprepared for how quickly and convincingly the new company had gotten its act together. In taking the industry by surprise, Landmark took market share with it.
Step 6: Measure your progress...and then wait for the offers.
After 18 months, a tracking study revealed that Landmark had climbed to a No. 2 ranking in "most preferred provider" status in all of the different segments and service categories in corporate aviation. The owners soon started receiving offers to sell the company.
The offers were not made solely for the entire company, but for parts of it as well. In particular, offers came in for the FBO part of the Landmark operation, both with and without the Landmark brand name. The difference between the offers was that the one that included the Landmark brand name was approximately $70M higher.
The day the sale closed, the new owner walked away with both the operation and the brand name, and we realized the value of just the Landmark Aviation brand was around $70M.
Given that the costs for building the brand over nearly a two-year period were around $8M, this meant that the investment in building the brand had yielded a return of 875%. Few, if any, investments in the lifespan of a corporation ever generate such remarkable returns in such a short time.
Of course, every company, and every brand, is different. But the process of building a brand doesn't change that much: know the competition better than you know yourself; start internally and work your way out, because your own people are among your greatest resources; retain your existing customers, and then go after new ones with everything you've got; measure your progress (and maybe, in some cases, field the offers); and finally, put all the resources you can behind creating a differentiating brand idea - an idea that helps visualize the brand.
And who wouldn't like 875% return on marketing.
If you'd like to know more about the external team that helped Landmark Aviation build its brand and its business, call Hans Ullmark at Collaborate (415) 710 2139.
About Gerbsman Partners
Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 68 technology, life science and medical device companies and their Intellectual Property and has restructured/terminated over $795 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception in 1980, Gerbsman Partners has been involved in over $2.3 billion of financings, restructurings and M&A Transactions.
Gerbsman Partners has offices and strategic alliances in San Francisco, Boston, New York, Washington, DC, Alexandria, VA, Europe and Israel.