The 22 Immutable Laws of Branding - Al Ries

The book is dedicated to Mary Lou and Scott.

It contains two main sections:

1. The 22 Immutable Laws of Branding This outlines 22 key principles or “laws” for building a successful brand. Some of the laws include:

• The Law of Expansion: Expand the brand or category slowly, not rapidly.
• The Law of Contraction: Narrow the focus and expand the brand.
• The Law of Publicity: Publicity is more effective than advertising.
• The Law of Advertising: Focus advertising on the brand name.
• The Law of the Word: A brand should stand for one word or concept in the prospect’s mind.

2. The 11 Immutable Laws of Internet Branding This section outlines key laws for building brands on the Internet, including:

• The Law of Either/Or: On the Internet, you have two brand options - either broad or narrow. Choose one.
• The Law of Interactivity: The Internet is an interactive medium, so brands on the Internet should foster interactivity.
• The Law of the Common Name: In the physical world, proper names are best, but on the Internet common names are better.
• The Law of Singularity: The Internet intensifies the “Law of Singularity” from the first section. Build a unique brand position.

The book argues that marketing is really about building brands in the minds of customers. Brands are simply words that represent a product, service or organization. The key to success is making your brand prominent and meaningful in the customer’s mind. Following the laws of branding, whether for traditional marketing or Internet marketing, is key to establishing a powerful brand.

• The power of a brand is inversely proportional to its scope. When you put your brand name on everything, that name loses its power.

• Chevrolet and Ford are examples of brands that have lost power by expanding into too many models and products. Originally powerful brands, they are now heading for decline.

• Companies often expand brands in the short term to increase sales, but this undermines the brand in the long term. It is better to keep a narrow focus to build a strong brand.

• American Express and Levi’s are other examples of brands that have declined after expanding into too many products.

• Procter & Gamble’s Crest brand has also lost market share after expanding to many different kinds of toothpastes. It is better to have a narrow focus.

• Companies try to justify line expansion using concepts like masterbrands, superbrands and megabrands. But customers prefer brands with a narrow scope and a short, distinguishable name.

• Many overzealous brand names are hard for customers to remember and don’t reflect how customers think about brands. Customers want simple, focused brand names.

• In summary, the most powerful brands have a narrow focus and simple, memorable names. Expanding brands too broadly ultimately weakens them.

• Sales are not solely a function of a brand’s power. They are also influenced by the competition. If competition is weak, a brand can gain sales by expanding into new segments, even if it weakens the brand. This may work in the short term but harms the brand in the long run.

• To build a powerful brand, focus on narrowing the brand, not expanding it. This is known as the law of contraction. Examples:

• Starbucks focused on coffee, not other types of food and drinks common in coffee shops. This helped them dominate the coffee category.

• Subway focused on submarine sandwiches, not the range of foods common in delis. This helped them become a major fast food chain.

• Toys “R” Us narrowed from selling children’s furniture and toys to just toys. This allowed them to stock a huge variety of toys and dominate the category.

• The birth of a brand is achieved through publicity, not advertising. Most major brands like The Body Shop, Starbucks, and Walmart were built with little traditional advertising. Advertising is better for maintaining established brands. Publicity, like news articles and media coverage, is better for launching a new brand.

• Examples of brands that focused on publicity over advertising in their early days include:

• The Body Shop: Founder Anita Roddick traveled promoting environmental ideas, gaining huge publicity. They spent little on advertising.

• Starbucks: Spent little on advertising in their first 10 years, relying more on publicity and word of mouth.

• Walmart: Grew into a retail giant with little advertising, focusing more on publicity and low prices.

• Sam’s Club: Averages $45 million per store in sales with almost no advertising.

So in summary, don’t confuse a brand’s power with its sales, don’t expand a brand to increase sales but narrow it, use publicity not advertising to launch a new brand, and some major brands have been built with little traditional advertising, focusing on publicity instead.

Here’s a summary:

• Miller’s $50 million Miller Regular beer brand failed because it lacked publicity potential and generated little awareness or sales. Advertising budgets alone cannot build brands today.

• Brands are now born through publicity, not advertising. The best way to generate publicity is by pioneering a new category. Successful brands like Band-Aid, CNN, Intel, and Starbucks became famous by being first in their categories.

• What others say about a brand (publicity) is more powerful than what the brand says about itself (advertising). Public relations has eclipsed advertising in building brands. But PR’s growing role has received little attention. Like the rise of fax machines, it has happened gradually.

• Once a brand’s publicity potential fades, advertising becomes necessary to maintain its health. Advertising deters competitors by raising the cost of entry into a market. Leaders should advertise their leadership, not product claims like “better quality.” Leadership implies quality and is more motivating.

• However, brands often don’t advertise leadership because consumer research suggests people don’t buy just due to a brand’s leadership. But people do assume the leader is the best. Leadership is strongly equated with quality.

• In summary, publicity builds brands and advertising maintains them. But a pioneering brand and leadership positioning are required for maximum impact.

• A brand should aim to own a word or attribute in the consumer’s mind. Mercedes owns ‘prestige,’ Volvo owns ‘safety,’ and BMW owns ‘driving.’

• Once a brand owns a word, it’s very difficult for competitors to take it away. Kleenex owns ‘tissue,’ Jell-O owns ‘gelatin dessert,’ and Coca-Cola owns ‘cola.’

• You know a brand owns the category word when people use the brand name generically, like ‘Xerox’ for photocopy or ‘Q-Tip’ for cotton swab.

• The best way for a brand to own a word is to be first in a new category. Federal Express focused on ‘overnight’ delivery and now that word is synonymous with the FedEx brand.

• If a brand wasn’t first, it can create a new category by narrowing its focus. Federal Express started with overnight delivery, and Prego took spaghetti sauce market share from Ragú by focusing on ‘thick’ sauce.

• Words give meaning to visual reality in the human mind. Brands have to associate themselves with a single word or attribute that stick in the consumer’s mind.

• Many brands make the mistake of trying to expand into too many attributes. It’s better for a brand to expand the overall market for an attribute they already own rather than stretching into new areas. Federal Express grew by expanding the overnight delivery market rather than moving into slower delivery options.

• A brand should aim to own a singular word or attribute, as the human mind can only associate so many concepts with a given brand. The key is to choose an attribute that competitors do not already own.

FedEx and Mercedes-Benz successfully built prestige brands by employing similar strategies:

1. Price their offerings much higher than competitors to signal higher quality and status.

2. Use subtle branding to convey prestige without seeming pretentious. For FedEx, their flashy packaging and overnight delivery conveyed importance. For Mercedes, their slogan “Engineered like no other car in the world” suggested high quality and status.

3. Start with a niche, premium market and expand from there. FedEx began with important business documents, Mercedes with expensive luxury cars. They built those markets through prestige and status, then expanded into broader markets.

4. Focus on building a new category rather than trying to overtake established competitors. FedEx created the overnight delivery market. Mercedes helped popularize luxury cars. They became leaders in the new categories they built.

5. Leadership credentials and claims of authenticity are crucial. FedEx became synonymous with overnight delivery. Mercedes is associated with high-quality German engineering. Those credentials make all their claims more believable.

6. Don’t assume people know who the leader is, especially in new categories.Promote your leadership prominently to attract new customers who want the best and most established brand. Leaders often have to forfeit sophisticated customers seeking unique or niche brands. But leaders attract the largest mainstream markets.

7. Find a credential to exploit, even in crowded markets. There are opportunities for leadership in subcategories, differentiators and niches. Budweiser leads domestically produced beer, Heineken leads imported beer, Samuel Adams leads craft beer, Corona leads Mexican beer, etc.

The key lessons are: build new categories rather than attack established leaders head-on; establish clear leadership and credentials to gain credibility and attract mainstream customers; start with a premium niche and expand from a position of strength and status; and subtly convey prestige and authenticity without seeming haughty or pretentious. Following these strategies has allowed FedEx, Mercedes and other brands to create prestige and success.

Quality is important for brands, but it alone does not build strong brands. Other factors like branding, perception, and pricing also matter.

• Quality is subjective and difficult to determine objectively. What seems high quality to one person may not to another.
• There is little correlation between a brand’s quality and its success in the market. Brands that rate highly on quality in tests often do poorly in sales. Brand perception and branding have a bigger impact.
• The perception of quality, not actual quality, is what really matters for brands. Branding and marketing build the perception of quality in customers’ minds.
• Narrowing a brand’s focus, having a distinctive name, charging a higher price, and being a specialist can all help build the perception of higher quality.
• The most effective branding creates an entirely new category rather than just capturing more of an existing market. Leading brands in new categories promote the category itself to help it grow rapidly.
• Customers care more about new categories than new brands. The brands that create and lead new categories, like Apple and Starbucks, become very successful.

In summary, while quality matters for brands, perception and branding ultimately have a bigger impact on a brand’s success. Creating new categories is the most powerful way for brands to establish themselves as leaders. Promoting the category, in addition to the brand itself, is key. Quality alone does not build brands.

Here are the key points from the passage:

• In the long run, a brand is nothing more than a name. The name is the most important branding decision.

• In the short term, a brand needs a unique idea or concept to be successful. But in the long term, the unique idea fades away. All that remains is the brand name and how it compares to competitors’ names.

• Xerox built a powerful brand based on its unique copier technology. But today, that technology is commonplace. Xerox’s most valuable asset is now its brand name.

• Many marketers underestimate the importance of brand names. They prefer generic or line-extended names. But those names lack the power of a unique brand name.

• There is a divide between companies that focus on product superiority versus those that focus on brand building. The “product camp” believes that product performance is most important, not the brand name. They incorrectly argue that an inferior product will fail regardless of its brand name. But truly inferior products are rare. Brand names have a huge impact.

• Asian companies tend to use umbrella brands or line extensions, rather than building unique brand names. Giant companies like Mitsubishi, Matsushita, and Mitsui use a single brand name for a wide range of products. U.S. companies, on the other hand, tend to build more focused brand names.

• A brand name is a company’s most valuable asset in the long run. The name is what differentiates a brand and sticks in the public’s mind. Successful companies recognize the power of brand names.

That covers the essence of the key points about brand names and their importance in the long run. Let me know if you would like me to clarify or expand on any part of the summary.

• There is not that much difference in sales between American and Asian companies. The major difference lies in profits, with American companies averaging 6.2% in profits and Asian companies only 0.8%. Many Asian companies operate at a loss.

• The Asian practice of producing many products under the same brand name is not financially sound. It leads to low profits and even losses.

• Korea’s largest companies had $409 billion in sales but a combined net loss of 0.4%. Hyundai, for example, produces many products under its name but makes little money.

• Throughout Asia, rampant brand extensions are damaging brands and profits. Brands are crucial to a company’s and country’s success.

• Asia’s problems are not financial or political but are due to poor branding. Brand extensions, in particular, are destroying brands.

• Brand extensions are also common in the U.S., with over 90% of new grocery and drug products being brand extensions. Many of these products do not sell well. Brand extensions have shifted power to retailers, who can demand payments and promotions from manufacturers.

• The beer industry is a prime example of rampant brand extension, with the major brands Budweiser, Miller, and Coors producing many extensions. But consumption and market share have not increased much. Brand extensions were a misguided reaction to competitors.

• Companies measure the success of brand extensions but not the damage to the core brand and lost opportunities. Major brands should dominate their markets but don’t due to brand extensions.

• Brand extensions typically gain customers from the core brand, not competitors. But companies wrongly target competitors.

• Diet colas and fat-free cookies are other examples where brand extensions damaged the core brand and a new brand was needed. Brand extensions represent “milking” a brand rather than building it.

Bayer launched a new line of over-the-counter pain relievers called Bayer Select that did not contain aspirin. The line extensions included acetaminophen and ibuprofen instead of aspirin. However, the line extensions failed and Bayer aspirin sales also declined. This demonstrates the negative effects of line extensions.

Line extensions often implicitly tell customers that the regular product is inferior or unhealthy in some way. Examples include “light,” “healthy,” and “fat-free” versions of existing products. These extensions can undermine the original brand and category.

It is usually better for companies to launch separate brands rather than line extensions when the market changes. Line extensions weaken brands by broadening their appeal, while separate brands allow products to stay focused.

Competition between brands, known as the “law of fellowship,” is actually good for a category. It stimulates demand, broadens the category, allows brands to stay focused, and gives customers choice. However, too much choice can lead to confusion and reduced consumption. Two major brands tend to be ideal for a category.

Similar types of businesses often congregate together in the same geographic area, which helps all of them attract more customers. This also allows for easy comparison shopping and helps companies keep track of trends.

A brand should welcome competition because no brand can dominate an entire market. At most, the leading brand can achieve around 50% market share. Higher shares usually require multiple brands.

• American Broadcasting Company (ABC), American Telephone & Telegraph (AT&T), American Express, Aluminum Company of America (Alcoa).

• National Broadcasting Company (NBC), National Biscuit Company (Nabisco), National Car Rental.

• International Business Machines (IBM), International Paper, International Harvester, International Nickel.

• Companies in the past used big, generic names to convey their scope and put small competitors in their place. These generic names gave companies a head start in the market that overcame the downside of the generic names.

• The shift to more specific brand names like Nabisco, Alcoa, NBC, GE, ABC, IBM, showed the power of a brand name over a generic name. These brands succeeded despite their generic company names.

• The problem with generic names is they don’t differentiate the brand. Blockbuster Video is a good brand name, General Video Rental is not. Budget is a good name for a rental car company, Low-Cost Car Rental is not.

• Sometimes taking half a generic word works well, e.g. Intel from Intelligent Chip Company. Intel is a great brand, Intelligent Chip inside is not a good slogan.

• Line extensions often fail because they use a brand name plus a generic name, e.g. Michelob Light is seen as Michelob light. The mind deals in sounds, not words, so a generic word is generic no matter the capitalization.

• Sometimes a line extension gets lucky if customers treat the generic part as a brand name, e.g. Vaseline Intensive Care lotion. Customers call it Intensive Care, not Vaseline.

• Brand names should take precedence over company names. Consumers buy brands, not companies. When a company name is used alone as a brand, it is seen as a brand, e.g. GE, Coke, IBM, Xerox.

• When a company name is combined with a brand name, the brand name is primary and the company name is secondary, e.g. General Motors Cadillac. People say “How do you like my new Cadillac?” not “How do you like my new General Motors luxury car?”

• A company is a company as long as its name is not a brand. A brand is a brand. Microsoft makes Word, P&G makes Tide. The company is the organization, the brand is the product.

• Gamble produces many products, one of which is Tide. However, it is usually not the best branding strategy to use the company name as the brand name. It is better to use the actual product name as the brand name, like Coca-Cola, Zippo, and WD-40 do.

• Managers tend to be company-oriented while customers are brand-oriented. Customers care about the actual product, not the company that makes it.

• Issues arise when a company uses both its name and the brand name, like with Microsoft Excel. Customers will likely shorten it to just Excel. When customers feel they have to use both names, there is usually a branding problem.

• There are a few options for including the company name. You can relegate it to small text at the bottom, include it in small text above the brand name, or leave it off entirely. The brand name should dominate the company name.

• Subbranding, or creating spin-off brands, often does more harm than good. Customers do not usually ask for more expensive or smaller versions of existing brands. Subbranding is often an “inside-out” strategy that appeals more to managers than customers. Examples of ineffective subbrands include Holiday Inn Crowne Plaza, Cadillac Catera, and DKNY.

• In summary, the focus should be on the brand itself, not the company behind it or subbrands. Build strong, clear brands and avoid subbranding when possible.

Here is a summary of Holiday Inn brands:

• Holiday Inn Select: A mid-scale brand that provides an upgraded Holiday Inn experience with additional amenities and services. It targets business and leisure travelers looking for more than a standard Holiday Inn.

• Holiday Inn SunSpree Resorts: A resort brand targeting families and leisure travelers looking for a full-service resort experience. The resorts offer amenities like pools, restaurants, recreation facilities, and entertainment options on site.

• Holiday Inn Garden Court: A brand targeting budget-conscious travelers in Europe, the Middle East, and Africa. The hotels provide basic amenities and facilities at a lower cost. They lack some of the services and amenities of a traditional Holiday Inn.

The key point is that Holiday Inn has developed subbrands to target different customer segments. The subbrands allow Holiday Inn to expand its market coverage while still maintaining its core brand identity. However, subbranding needs to be done carefully to avoid brand dilution and confusion. The subbrands should have distinct identities and not detract from the main Holiday Inn brand.

• Chevrolet’s model names like Cavalier, Camaro, Corsica, Caprice, and Corvette are confusing because they are too similar. These names cannot function as brands because they lack distinctiveness.

• Chevrolet should have used more distinctive names if it wanted to create brands. Alliteration, referring to the similarity in the initial sounds of words, makes the names hard to distinguish.

• New brands should create new categories, not just compete with existing brands. Coca-Cola’s launches of Mr. Pibb, Fruitopia, Mello Yello, and Surge failed because they were meant to block competitors rather than create new categories.

• Sibling brands, or brands in the same company, must be carefully managed to maintain distinctiveness. Otherwise, they become too similar through “sibling rivalry,” or copying each other’s features. General Motors’ brands suffered from this.

• A brand’s logo should have a horizontal shape because people’s eyes are arranged horizontally. This shape is the most impactful in any use of the logo. Vertical logos are disadvantaged, as seen in Arby’s logo.

• Legibility, or how easy the logo is to read, is more important than the typeface or font in determining a logo’s effectiveness. While typefaces convey different moods, people barely notice these differences. The key is that the prospect can read and remember the brand name.

• A logo’s visual symbol is secondary to the brand name. The name gives meaning to the symbol, not vice versa. The Nike swoosh means little without the “Nike” name. Shell’s logo works due to the simplicity of its name and symbol, but the symbol alone may confuse new prospects who don’t know “Shell” is a gas brand.

• Color choice is important but limited. The five basic colors (red, orange, yellow, green, blue) and neutral colors (black, white, gray) are best. Red conveys energy while blue conveys stability. Leaders often pick symbolic colors, e.g. John Deere’s green. For a new Brazilian tractor brand “Maxion,” the author considered green but ultimately chose red, the complementary color to its competitor’s blue.

• Companies often believe that the only way to grow is to expand into new categories. However, a better strategy is to build a global brand while maintaining a narrow focus in the home country.

• Crossing borders can increase a brand’s value because consumer perceptions differ in each country. Brands associated with certain countries, like Swiss watches or French wine, are perceived as higher value.

• To become a successful global brand, a company needs to be first to market and have a product that fits consumer perceptions of its country of origin. Heineken became the second largest brewery by being the first to pursue a global beer brand, even though it’s Dutch and beer is associated more with Germany. Corona Extra also leveraged perceptions of Mexico to become the top imported beer in the U.S.

• There is no such thing as a global brand with a global perception. All global brands are still associated with a particular country, like Toyota and Honda with Japan or Gucci and Versace with Italy.

• While Coca-Cola sells globally, it should not abandon its American heritage. Its origin and association with American culture has helped propel its success worldwide. Every brand comes from somewhere, even if it’s manufactured or bottled in different countries.

• In summary, expanding into new categories is not the only path to growth. Building a successful global brand based on leveraging perceptions of a company’s home country can also drive growth. Maintaining a consistent brand focus at home while tailoring the brand’s image to match consumer perceptions in each new country is key.

• A brand’s geographic perception is determined by its name and connotations, not where it was conceived, designed, or produced. For example, Häagen-Dazs sounds Scandinavian though it’s from New Jersey.

• Many global brands use English names to appeal to international audiences, even if they have no connection to English-speaking countries. For example, Red Bull, Replay jeans, and Big Star jeans are from Austria and Italy, respectively, but use English names.

• However, care must be taken when translating slogans and marketing messages into other languages to avoid disastrous results. For example, “Come alive with the Pepsi generation” in Chinese becomes “Pepsi brings your ancestors back from the grave.”

• The law of consistency says that brands should not change. Markets and trends may change, but successful brands remain consistent. For example, Tanqueray should stick to gin instead of introducing a vodka. Coca-Cola should not introduce a beer. Volvo should focus on safety instead of sports cars. BMW should focus on performance instead of station wagons.

• Little Caesars violated the law of consistency by abandoning “Pizza! Pizza!” and its takeout-only model. It has suffered as a result. McDonald’s Arch Deluxe burger also failed by abandoning its kid-friendly brand.

• Brands should be limited and focused. Trying to appeal to too many target markets often dilutes a brand. For example, “Why should we limit ourselves?” is a red flag.

• The law of change says brands can be changed, but only carefully and infrequently. Change should start with how the brand is perceived by customers, not how internal procedures or materials look. Evolution, not revolution. For example, logos, packages, and other symbols can be gradually refined but not overhauled. Consistency over decades is key.

• Brand changing occurs in the minds of consumers, not inside companies. For brand change to be successful, companies need to focus on shaping how consumers perceive the brand.

• There are three situations where brand change is feasible:

1. The brand is weak or nonexistent in consumers’ minds. In this case, companies have flexibility to reposition the brand in any way. Intel successfully changed its brand from DRAM chips to microprocessors.

2. The company wants to move the brand down the price ladder. This can work if done gradually, allowing consumers time to get used to the new positioning. Marlboro and Citibank were able to reposition themselves as more mass market brands over time.

3. The brand is in a slow-moving field, allowing change to happen gradually. Citibank was able to shift its brand from corporate to consumer over 25 years.

• Brand change is very difficult and often unsuccessful. Consumers are resistant to changing their perceptions of established brands. Many attempts at brand repositioning, like KFC promoting rotisserie chicken or Xerox selling computers, have failed.

• Brands, like all things, have a life cycle and will eventually die. Companies need to recognize when a brand has reached the end of its useful life and is better off being retired. It is often better for companies to invest in building new brands rather than trying to prop up aging brands.

• The value of a brand depends on how well known it is and what it stands for. Well-known brands without a strong positioning have little value and are hard to reinvigorate. Kodak is an example of a brand that dominated in film photography but is struggling with the rise of digital photography. Kodak’s attempts to extend its brand to new areas like videotape and digital cameras have been largely unsuccessful. Kodak may have been better off launching new brands for these areas rather than diluting its established photographic brand.

In summary, the key to successful brand change is recognizing that brands exist in the minds of consumers. Companies need to carefully monitor how their brands are perceived and make changes in a way that matches how consumers’ perceptions are evolving. Brands that no longer serve their purpose are best retired and replaced.

• Successful brands that emerge when new technologies develop are often new brands, not established ones. Examples include Sony (mini electronics), Blockbuster (videotape rentals), Dell (personal computers).

• Established brands often lose their singular focus and identity as they extend into new product areas and markets. Examples include Chevrolet, Miller, and Panasonic. This weakens the brands.

• Powerful brands have a singular idea or concept. They can be used as a substitute for a generic product descriptor. Examples include Heineken (imported beer), Rolex (expensive watch), Prego (thick spaghetti sauce).

• On the Internet, brands must decide to treat it as either a business or a medium. Treating it as both weakens the brand by fracturing its identity.

• Internet brands should start from scratch, developing new strategies and names. Putting an established brand name on a website is often not effective. Examples of successful Internet brands include Yahoo, Amazon, eBay, AOL.

• The Internet is a good medium for providing information to customers and prospects. But to build a powerful brand, companies must treat it as a business.

• Established companies often make the mistake of using their existing brand names and strategies on the Internet. This rarely works. The Internet requires new thinking and new brands to be successful.

• It is difficult for established media brands to transition to new media. For example, few newspapers or magazines were able to successfully move into television. The Internet is a unique new medium and requires unique new brands.

• Two key questions for building an Internet brand are: What works on the Internet? What doesn’t work on the Internet? Answering these requires forgetting past brand strategies and starting from scratch.

• The Internet can serve as either a medium for an existing brand or as a platform for an entirely new brand. It depends on the nature of the product and business.

• For tangible products, the Internet tends to function more as an information medium. For intangible products like financial services, insurance or stock brokerage, the Internet can become the primary platform for the business.

• Fashionable products are also more likely to use the Internet as a medium, while non-fashionable products can build an entirely new brand on the Internet. Clothing and shoes are examples of fashionable products less suited to the Internet as a primary sales platform.

• Products with many variations and options are good candidates for new Internet brands. It is difficult for physical stores to carry the huge array of options that can be offered on the Internet. Books and office supplies are examples.

• Larger companies may use the Internet as a platform for a new brand to differentiate it from their traditional business. Amway launched Quixtar.com and Procter & Gamble launched Reflect.com as separate Internet brands.

• The Internet can generate major cost savings for companies, especially those relying heavily on telephone interactions. American Express and Charles Schwab are examples of companies that have cut costs by shifting interactions to the Internet.

• The Internet has allowed some companies to completely restructure their businesses. Dell Computer, Cisco Systems and Charles Schwab have shifted a majority of their business to the Internet. Some smaller companies like Hoover’s, Provident American and Homebid.com have also completely reinvented themselves as Internet companies.

• A company’s brand and strategy needs to be consistent to build customer trust. Speaking out of “both sides of your mouth” by denigrating the Internet while also trying to profit from it can undermine a brand. Merrill Lynch is given as an example of a company whose strategy seems inconsistent and potentially damaging to its brand.

• Product personalization and customization are likely to become more important in an Internet-dominated economy. With the ability to find anything online, customers will increasingly expect products tailored to their needs.

That covers the key highlights and main points around using the Internet as a medium versus a platform for new brands according to the summary. Please let me know if you would like me to explain or expand on any part of the summary.

• If physical stores are your major distribution channel, reduce product variety. Too many options mean the one a customer wants is often out of stock.

• If the internet is your major channel, promote a wide range of products. It’s easy for customers to compare options.

• Low price is important for internet brands, like eBay and Priceline. It’s easy to check many sites for the best deal. This price pressure makes it hard for brands to profit.

• Shipping costs matter for internet brands selling bulky or heavy products, like groceries. High selection, delivery and low profit margins make e-grocers struggle. Most experts think e-grocers won’t become mainstream.

• Interactivity is the unique attribute of the internet as a medium. Without it, an online brand won’t succeed. The internet lets brands interact with customers in new ways.

• Traditional advertising usually won’t work online. People can easily avoid ads on the internet. Likewise, traditional media like newspapers and magazines usually won’t translate well to the online environment. They lack interactivity.

• An online brand’s success depends on presenting itself in an interactive way. Traditional brand-building approaches often won’t work.

• n-line publication Salon continues to lose money, losing $40 million since 1995. Publisher argues “future of media is online” but analysts argue print and Internet are different mediums and combining them is a mistake.

• TheStreet.com, an online newspaper, continues to lose money, losing $69 million in 2000 on $23 million in revenue. Internet advertising is declining as companies realize its limitations. Ironically, Internet sites spend most of their ad dollars on traditional media like TV, newspapers, and radio.

• Successful online publications include Wall Street Journal’s online edition (600,000 subscribers paying $29-$59/year) and Consumer Reports Online (590,000 subscribers, though print subscriptions have declined). Their success is attributed to interactivity and lower cost.

• What works in one medium won’t necessarily work in another. Successful brands are built for a specific medium. Newspaper and TV brands have not successfully become magazine or cable brands. Successful cable brands like HBO, ESPN, and CNN were created for cable, not extensions of broadcast brands.

• Too many companies try to extend existing brands to new mediums, e.g. News Corp. extending TV Guide to cable and Internet. This strategy rarely works. To build an Internet brand, you need a new brand designed for the Internet with interactivity.

• Interactivity—the ability to type in instructions and get customized information, add your own information, get complex pricing, take tests, conduct auctions, get diagnoses and remedies—is key to an Internet brand’s success. The Internet can enable more interactivity than other mediums.

• The “kiss of death” for an Internet brand is a common, generic name. In pre-Internet days, a brand’s visuals were also important but the Internet eliminates visuals. The brand name alone must represent the brand. Most Internet brands have common, generic names like Advertising.com, Buy.com, Garden.com, etc. These lack distinctiveness and association with a specific company or product. Proper nouns, like Mercedes-Benz, have traditionally made the best brand names.

In summary, the key points are: 1) Success in one medium does not translate to success in another; 2) Interactivity is essential for Internet brands; 3) A distinctive, proper-noun brand name is critical for an Internet brand. Common, generic names are ineffective.

• Purists and trademark experts prefer to call brand names “proper adjectives,” as in “Mercedes-Benz cars.” But most people use brand names as nouns, saying “I drive a Mercedes” rather than “I drive a Mercedes car.”

• The most valuable brand names in the world are proper nouns, not common or generic names. None of the top 75 worldwide brands worth over $1 billion each are common or generic names.

• Early on, common names were an advantage for Internet companies because people were still learning website names and it was easy to guess common names. But now, with over 5 million websites, common names provide no advantage.

• Many Internet companies continue to use common names out of habit and because everyone else does. But just because most websites use common names doesn’t mean it’s the best strategy. Common names make it hard to establish a unique brand identity.

• Many dotcoms that used common names, like Cars.com, Drugstore.com, and RealEstate.com, went out of business despite spending heavily on advertising. Common names represent the category, not a specific company.

• Some common name sites like eToys and ETrade were initially successful. But their names make them vulnerable to competition from similarly-named sites. ETrade’s name is weak because “e-trade” refers to the category, and the asterisk can’t actually be used in the URL.

• In summary, common or generic names are not good brand names and were a major contributor to the dotcom failures of the early 2000s. Proper brand names are superior for establishing a unique identity and brand value.

• E*Trade was an early leader in online stock trading but has fallen to second place behind Charles Schwab.

• ETrade makes a lot of money from advertising but is losing money overall. It lost $242 million in one year on $1.3 billion in revenue. It’s unclear if ETrade can continue expanding while losing money.

• Proper names, not common names, tend to dominate successful brands. Very few major brands use common names. Examples of major brands using proper names include Ford, Citibank, CVS, Ikea, Kroger, Macy’s, and Walmart.

• The mind treats common names as categories, not as specific brands. This can lead to confusion, as in Abbott and Costello’s “Who’s on First?” comedy routine. Many companies have tried and failed to build brands around common names.

• Some product categories, like breakfast cereals, do use many common names. But no one brand dominates in these categories. The top cereal brand has only 6% market share.

• Common names don’t work well for building brands on the Internet. It’s hard to distinguish a common name from the category and associate it with a specific product or service. Combining an attribute with a common name, like AllBooks4Less.com, may get some short-term success but won’t build a strong long-term brand.

• Your brand name is very important on the Internet because it stands alone. There are no visual or location clues to indicate what the brand is about. A mediocre name can work in the physical world with those additional clues, but not online. The name alone must convey the brand’s identity on the Internet.

• Smart companies can benefit in the long run by using a distinctive brand name instead of a common generic name. After the generic names fade away, a memorable and meaningful brand name will still stand out.

• A retail store can develop such a distinctive brand that customers refer to it by its location rather than its actual name. For example, “the repair shop at the corner of Eighty-seventh Street and York Avenue.”

• Even seemingly dull names can work for retail stores. Examples: “The Mattress Firm,” “The Money Store,” “General Nutrition Centers.” These names always rely on additional context clues to convey their purpose.

• On the internet, there are no context clues. Generic names don’t work well for websites. Big winners like AOL, Amazon, eBay, Priceline, and Yahoo are proper names, not generic names.

• Generic names for a category should be avoided. For example, iVillage is better than Women.com. Ashton.com is better than Cyberluxury.com.

• The same principles apply in the physical world. Proper names are better than generic names. Examples: McDonald’s is better than Burger King. Hertz is better than National Car Rental. Time is better than Newsweek.

• The ideal website name is short, simple, and proper. It should be easy to spell and remember. Long, complex, generic names don’t work well. Many companies may need to rebrand for the internet age.

• Using a nickname in addition to the full name is a good strategy. For example, CharlesSchwab.com and Schwab.com. AskJeeves.com and Ask.com. Nicknames make brands feel more personal and accessible.

• Short and simple are not the same. Simple names use a limited set of letters in repetitive combinations. For example, Mississippi is long but simple; Schwab is short but not simple. Coca-Cola is both short and simple. Pepsi-Cola and Autobytel.com are more complicated.

• In summary, the ideal internet brand name is a short, simple, and proper name that is easy to remember and spell. Avoid long, complex, generic names. Consider rebranding if needed for the digital age. Using a nickname in addition to the full name is a smart strategy.

The name Autobytel uses letters of the alphabet to form the name. However, it is unclear whether it should be parsed as “Auto by Tel” or “Auto Byte l”. “Bytel” itself is not a real word.

Despite having an early lead, Autobytel is unlikely to become the top site in its category due to its confusing name. In contrast, Nissan is a superior brand name to Datsun because it only uses four letters versus six and has become dominant.

A good brand name should:

1. Suggest the product category without being too generic. Shortening a generic name or adding an unusual word are two ways to achieve this. For example, PlanetRx or DrugDepot.

2. Be unique and memorable. AskJeeves and DrKoop are examples of unique and memorable internet brand names. In contrast, generic names like More.com, Send.com or Gift.com are not memorable.

3. Use alliteration which helps in memorability. Examples are Bed Bath & Beyond, Blockbuster, etc.

4. Be easy to speak as people often first hear about brands through word-of-mouth. Names like Onsale.com, Entrepreneur.com or iWon.com are hard to speak about.

5. Avoid mixing letters and numbers which can be hard to recall. Examples are 1stBuy.com, 123greetings.com, etc. Phone numbers are easier to remember than license plates.

6. Be selected by listening to how the name sounds when spoken rather than just visually reviewing options on paper. The spoken word has more impact.

7. Have an element of “shock” or surprise to be memorable. Examples are DieHard batteries or Haagen-Dazs ice cream. However, the shock factor should not offend people.

In summary, a good internet brand name should suggest the product category, be unique and memorable, use alliteration, be easy to speak, avoid mixing letters and numbers, be selected based on how it sounds when spoken, and have an element of surprise. A confusing or generic name is unlikely to build a successful brand.

• It is difficult to get business books reviewed by major media outlets. You often need an attention-grabbing title to stand out. A title like “The 22 Generally Accepted Laws of Branding” is unlikely to attract much interest.

• Using an element of “shock” or emotion in a brand name or book title makes it more memorable. We tend to remember things that stir our emotions. Common names lack this and are hard to remember.

• Successful internet brands often use shocking or emotional names, like Yahoo!, Amazon, Hotmail, and Monster. These stir up a reaction and are locked into a category or benefit.

• Personalizing a brand name by using an individual’s name has advantages. It ensures a unique name rather than a common one. It increases publicity potential, as the media prefer interviewing people over brands. Many major brands are named after their founders.

• On the internet, it is critical to avoid being second in your category. There is no room for number two brands. The internet operates more like the software industry, where each category is dominated by a single brand. There are no intermediaries on the internet, so there is no need for leverage against a leading brand. The internet adheres to a “winner-take-all” model, with a few dominant sites getting nearly all the business.

• In the real world, number two brands fill a need for intermediaries like retailers, who want leverage against leading brands. On the internet, there are no intermediaries, so there is no need for a second brand. The real world acts as the second brand, with internet brands being compared to real-world options.

• The prospect of switching to a competitor like bn.com is not compelling for most customers of Amazon.com. Unless Amazon suffers a major failure in service or pricing, most customers will stay with them.

• In the physical world, a brand’s popularity often creates a backlash that benefits competitors. But on the web, a brand’s popularity and dominance are not as visible to customers. So competitors have a harder time capitalizing on any backlash.

• While there are many smaller brands in any given web category (e.g. many furniture sites), over time one brand typically comes to dominate. This is known as the “law of singularity.” Amazon dominates books, and will likely continue to dominate unless they make a major mistake.

• For competitors of a dominant brand like Amazon, the odds of overtaking them head-to-head are very low. A better strategy is to focus on a niche segment of the market that the dominant brand does not fully serve. Compete as a “second brand” that addresses a particular need. Some examples are Alibris in used books, Medsite in medical books, and Varsitybooks in textbooks.

• When building an internet brand, define the category you want to lead first. Then establish your brand as the leader in that category in the minds of customers. Simply having a website is not enough. You must communicate what category you are in and why you are the best in that category.

• Offline advertising and marketing will likely remain bigger than online advertising for the foreseeable future. While the internet provides new opportunities for targeted ads, traditional media still has major advantages in reach and impact. The most effective marketing strategies will integrate both online and offline components.

• Naming rights deals, in which brands buy the naming rights to sports arenas, events, and other properties, are increasingly popular. They provide high visibility and exposure for brands. But some feel they have gone too far and commercialized spaces that should remain untainted by marketing. There is a risk of consumer backlash.

• In summary, competing with dominant web brands like Amazon is very difficult. The keys to success are: focus on a niche, define your category, establish leadership in your target segment, and use integrated online and offline marketing to build your brand. Avoid direct head-to-head competition whenever possible. With focus and patience, second brands can thrive.

• Naming rights for a new sports arena in Atlanta were sold for $200 million over 20 years, which is more than the $140.5 million cost to build the actual arena. This shows how advertising-oriented our world has become.

• Traditional media like print, radio, and TV are dominated by advertising. They generate billions in ad revenue each year. Cable TV also now has a lot of ads.

• The Internet was supposed to be a new ad medium, with free content supported by ads. Many sites offered free services, contests, and giveaways to draw traffic and sell ads. Some even paid people to view ads. Many dotcoms spent lavishly on launch parties and promotions.

• However, the Internet did not become an ad-dominated medium. Users can control their experience and ignore ads. Ad click rates and ad rates have dropped. Many people use ad-blocking software. Some ad numbers are dubious, including site ad swaps and the high commissions of companies like DoubleClick.

• The Internet is a revolutionary medium, not just another ad-based medium like TV. As an interactive medium, users are in control, not content providers. Users want information, not more ads.

• Internet advertising may increase indirectly by driving more ads on media like radio, TV, and print that direct people to specific websites. After declining with the dotcom bust and 9/11, ad spending should increase again with the economy.

• In summary, the Internet has not become an advertising-dominated medium as expected. Users have more control and less tolerance for ads in this interactive medium. But the Internet should continue to boost ad spending on traditional media that direct people to websites.

Here’s a summary:

• Dotcoms dominated Super Bowl advertising in 2000, spending an average of $2 million for a 30-second ad.

• Internet brands suffer from people’s ability to forget them and lack of daily visibility and emotional connection. They rely on publicity and advertising to stay top of mind.

• Radio is an effective medium for Internet brand advertising because it’s a verbal medium and the Internet brand name is key. However, online advertising is less effective because people interact with and often ignore it.

• The Internet is demolishing borders and barriers, enabling global trade and connectivity. This globalism was enabled in part by the fall of communism, itself enabled by the spread of Western television showing Soviets the prosperity of capitalism.

• The Internet’s “message” is globalism, just as television’s was capitalism. It’s creating a global village and market.

• Globalism will likely be the biggest trend of the 21st century. The U.S. dominates the Internet but other nations have higher connectivity. The global market offers more opportunity than the domestic market.

• The U.S. exports 11% of GDP currently but brands are a major export. However, globalism is a two-way street, with foreign brands and cultures also spreading to the U.S.

• American popular culture has been influenced by foreign products, brands and characters, e.g. Pokemon from Japan, Starbucks from Europe, Evian water from France, Volkswagen and Toyota cars from Germany and Japan.

• The Internet is accelerating the trend of foreign products entering the American market. Many American websites already do a lot of business outside the U.S., e.g. Amazon.com. The potential for global e-commerce is huge.

• Successful global brands need to transcend national borders. Generic brand names may not work across countries and languages. Brands with national identities, e.g. Burger King (American), Volvo (Swedish), Rolex (Swiss), can also become global.

• A brand’s national identity can help or hurt its global success depending on the product category. American PC brands are global but American car brands struggle globally. Perception matters more than reality.

• When launching a global Internet brand, match the product/service to the nation’s perception and image. E.g. an Italian name for a clothing site, a French name for a wine site, a Swiss name for a watch site. However, consider less developed countries which offer opportunities.

• Barriers to global e-commerce include red tape, taxes, duties and customs. Language is also a barrier. Options include: English-only site, translated sites in multiple languages, or separate sites for different countries. English as a second language is growing globally.

• For high-tech or high-end products, an English-only site may work best, e.g Cisco.com. For mainstream products, multiple translated sites may suit better, e.g. Yahoo! en Español. However, there is never only one approach.

• If unsure, an English-only site is a safer bet. English is the dominant online language. Many non-English brands use English names to seem chic, e.g. Hollywood cigarettes (Brazil), Montana cigarettes (Mexico), Red Bull (Austria), Boxman (Sweden). English brand names are common globally.

• The spread of English and English brand names will benefit U.S. brands. Consider if this trend makes an English-only site the best long-term choice.

That’s a high-level summary of the key points on global e-commerce and brands based on the information given. Let me know if you would like me to clarify or expand on any part of the summary.

Globalism is more about cultural homogenization than overcoming language barriers. Successful global brands like Coca-Cola, McDonald’s, Levi’s, and Subway were successful precisely because they did not adapt much to local cultures. They spread a common culture worldwide.

The internet accelerates globalization by connecting people worldwide and spreading ideas. When StarMedia launched the first Spanish/Portuguese social network, skeptics thought Latinos were too culturally distinct to use it. But it succeeded, showing how global connectivity can spread culture.

Several factors have enabled globalization, like planes and fax machines. But the internet is the most powerful, accelerating the spread of ideas and culture.

To succeed in a globalized world, speed and timing are key. Being first in the marketplace means little without getting into people’s minds first. Many big companies are too slow, wanting to perfect new products before launching them. But by then, competitors have already won people over.

Examples of successful first movers that got into people’s minds first include Yahoo, eBay, Amazon, Bluemountain, and Priceline. Though not literally first, they were first to spread their concepts widely. Ideas often arise nearly simultaneously in different places, so execution is key.

Big companies are often too slow, wanting excessive market research and perfection. But the internet moves too fast for that. Success comes from rushing in, even in a “half-assed” way. Yahoo outsourced its search technology so it could move fast to build its brand.

The myth is that you win by being better. Really, you win by being first. Success comes from a sense of urgency, like famous dropouts Bill Gates and Michael Dell had. Today is the best day to launch an internet company.

Northern Light was a search engine that indexed more web pages than competitors, but it launched too late, 3 years after Yahoo. Despite its quality and funding, it couldn’t catch up because timing is so important. The message is: move fast and get into people’s minds first. That’s the key to success in a globalized, internet-connected world.

• It’s a mistake for successful companies to believe they can do anything just because they have the willpower and resources.
• Overconfident management has been responsible for many marketing disasters. For example, GE couldn’t succeed in mainframe computers, Sears failed at selling brokerage accounts in its stores, Xerox failed in computers, IBM failed in copiers, Kodak failed in instant photography, and Polaroid failed in conventional film.
• The problem is usually not the product but the perception. It’s very hard to change perceptions that exist in customers’ minds. Once a company stands for something, it’s hard to change. For example, Cadillac stands for “big cars” so it failed with its small Catera, while Volkswagen stands for “small cars” so it failed with its larger Passat.
• Success in one area often leads companies to unsuccessfully expand into other areas. For example, Amazon originally succeeded as an Internet bookstore but is now expanding into many other areas like DVDs, toys, home products, and more. However, it will likely struggle to change the perception that it’s primarily an Internet bookstore.
• Bill Gates argues that successful companies like Amazon should expand into other areas, but that ignores the challenges of overcoming existing customer perceptions. Just because a company has the will and resources to expand doesn’t mean it will succeed.

In summary, the key message is that companies should be very careful about expanding beyond the areas they are known for, because customers have existing perceptions that are hard to change. Success in one area does not necessarily translate to success in other areas.

• Line extension is very popular among companies but rarely works in the long run. It may succeed initially due to a company’s dominance or popularity but ultimately weakens the brand.

• Yahoo is a good example. It started as an Internet search engine but expanded into many other services and acquisitions in an attempt to be “all things to all people.” While initially successful, this strategy makes it difficult to have a clear brand identity and focus.

• There are better strategies for dominant brands:

1. Stay focused on your core business. For Amazon, this would be books and music.

2. Increase your share of the existing market before expanding into new markets. For Amazon, aim for 25% of the book market first.

3. Expand your market in logical ways, e.g. through related offerings like book clubs.

4. Go global to reach more customers. Amazon currently only sells 22% of books overseas.

5. Dominate your category. A 25% market share is a good goal. Domination builds strong brands.

• Product vs. perception: Strong brands are more about perception and domination than just having the best product. Leadership often comes first, then the perception of the best product.

• Second brands are better than line extensions for expansion. Examples: Coca-Cola owns Sprite, Anheuser-Busch owns Michelob, Toyota owns Lexus. AOL owns CompuServe.

• Dominant companies like Microsoft can get away with line extension due to their power and size. But for most companies, line extension weakens the brand in the long run. Multiple brands are a better strategy.

• In summary, focus, increase market share, expand logically, go global, dominate the category, build perception, and launch second brands. These are the keys to strong, long-lasting brands.

• There is an obsession with convergence, the idea that technologies will merge together. Many companies are trying to combine the PC, TV, and Internet, for example.

• However, technologies actually diverge over time rather than converge. They splinter into many specialized forms rather than merging into one.

• For example, radio has diverged into AM, FM, satellite radio, etc. TV has diverged into broadcast, cable, satellite, etc. The phone has diverged into landline, cell, satellite, etc. Computers have diverged into PCs, laptops, tablets, etc.

• What’s possible is not the same as what’s practical. Just because technologies can be combined doesn’t mean people actually want that combination. Many attempts at technology convergence, like PC/TVs, have failed.

• It’s more likely we’ll see specialized Internet devices rather than accessing the Internet through TVs. Many inexpensive Internet appliances for basic functions like email already exist.

• In summary, divergence, not convergence, is the dominant trend. Technologies split into many forms rather than merging into one.

The convergence concept argues that combining multiple products or services into one device or offering will be appealing and successful. However, history has shown that convergence products typically underperform and struggle in the marketplace. This is because convergence products represent a compromise that often does not meet any single need particularly well.

In contrast, divergence products that focus on a single function tend to be much more successful. This is consistent with observations in nature, where increased complexity and new species emerge from the divergence and division of existing ones. The convergence of different species into a single hybrid is rare.

Likewise, the idea of unified Internet services that combine things like messaging, email and fax into a single interface often struggle. These services may seem convenient in theory but in practice often do not serve any one purpose particularly well. Different modes of communication have different uses, and people have different preferences in how they send and receive each type of message.

While the Internet will transform how we live and work in many ways, convergence is unlikely to be a major part of that transformation. The successful use of the Internet will come through innovative applications focused on a single purpose, not from attempts to converge too many functions or modes of communication into a single service or device. The ultimate winners will be divergence products, not convergence.

In summary, convergence products struggle because they represent compromised solutions that serve no single purpose particularly well. Divergence better reflects how complexity and new capabilities actually emerge in nature and in successful technology products. The Internet revolution will come through focused, purpose-built applications and services, not from attempts to converge too many different functions or modes of communication into a single interface or device.

• Paper directories like phone books and encyclopedias are doomed because electronic versions are superior. They are interactive, frequently updated, and cheaper to distribute.

• Paper catalogs also face an uncertain future due to electronic competition. Websites can provide the same information in a more interactive and cheaper way. Some companies may shift entirely to websites, while others may remain catalog-only.

• Expensive brochures are likely to become rare as companies realize websites can provide the same information at a lower cost. Some companies may use websites to provide details and only use print materials for initial promotion.

• Classified ads are likely to shift to websites. Sites like Monster.com already provide a huge number of job listings, and their success shows the potential for other types of classifieds to move online. Local newspapers need to adapt quickly to this trend.

• The postal service will likely deliver less mail as more communication shifts to digital means like email, and as more billing and payments move online. The process of mailing and paying bills is inefficient compared to electronic banking, so companies and customers will likely transition to the latter over time.

In summary, print publications and the postal service face major challenges as more information and transactions move to the digital realm. Some will adapt, while others may struggle if they fail to keep up with this trend. But one way or another, the Internet is affecting all businesses.

• E-mail usage is growing at an exponential rate of 50% per year. This phenomenal growth suggests that e-banking and other online financial services will also grow rapidly.

• Financial transactions are well suited for the Internet because money is essentially electronic data. It makes sense for banking, bill paying, investment management and other financial services to move online. This can produce major cost savings since online transactions are much cheaper to process than in-person or ATM transactions.

• The shift to online financial services and e-commerce will drive a boom in parcel delivery and shipping. This will benefit companies like UPS, though delivering to residential customers when no one is home remains a challenge. Some companies are developing secured delivery boxes with digital locks that can be opened with one-time codes.

• Internet retailing will intensify price competition. It is easy for customers to compare prices across many websites. Some websites also offer tools that automatically find the lowest price for a product. This price competition will pressure retailers to cut costs and change their business models.

• Successful physical retailers will shift from competing on price to competing on customer service and experience. They will emphasize the ability for customers to touch, feel and try products in person. They will also provide convenience by offering immediate access to products without waiting for shipping. Retailers that provide an enjoyable in-store experience, quality service and good product selection can still thrive despite online price competition.

• In summary, while the Internet is transforming financial services and retail, physical stores that focus on experience and service have a path to continue prospering. Companies in all industries must adapt to the rise of e-commerce, or face potential decline. But with the right strategy and investments in experience, traditional business models can still thrive in the digital age.

• The customer will not tolerate frequent out-of-stock problems in physical stores. This is often due to a focus on low prices and special deals. Stores can avoid this by not focusing solely on low prices.

• Roughly half of customers leave stores without buying anything, often because the desired item was out of stock.

• Most business will still be conducted in person, not online. But the Internet will force businesses to shift strategies from a price focus to a service focus.

• Search engines like Yahoo! will become less important as people go directly to sites they know and trust. Search engines are most useful for new Internet users.

• The Internet will significantly impact the telephone industry. The Internet is 80% information and 20% communication, while the phone is the opposite. The information segment, like yellow pages, will move online. Email will replace some calls and faxes.

• There will be some “speed bumps” for the Internet, like the bursting of the Internet bubble and new taxes on online sales.

• Future technological revolutions could include new developments in optics, transportation, genetics, and agriculture. But they will be disruptive.

• There will continue to be new laws of branding to navigate future changes.