Faithful readers with long memories know that I attributed most of Donald Trump’s early success to brand power. Campaigns are marketing, candidates are brands, and Trump was – and remains – the strongest brand in either party by a mile. Viewed purely as an exercise in brand building, his foreign policy speech yesterday probably lengthened his lead.
Brand power doesn’t arise from what most of us marketing amateurs think. It isn’t based on lots of people knowing or liking a brand. It results instead from two features: a brand’s differentiation from other brands and its relevance to its intended public, as research by the Young & Rubicam ad agency established long ago. By those two criteria, Trump dominates utterly. He is completely unlike all other candidates, and he is far more relevant because he’s real – he talks naturally, not like a politician, and he says out loud what a segment of voters is thinking.
He differentiated himself further yesterday, outlining a foreign policy like nothing any other candidate has enunciated or is likely to. He called for a major buildup of the military, though even a conservative Republican like former Wyoming Senator Alan Simpson has said it’s bloated and should be slimmed down. He threatened to withdraw from NATO unless other members pay more, though no U.S. president of either party has ever gone remotely near enforcing such a demand. He used the phrase “America first,” explicitly recalling the isolationist group by that name that, until Pearl Harbor, lobbied hard to keep the U.S. out of World War II.
Like Trump himself, many of the positions he described are way outside the mainstream. Will the speech build him as a leader by attracting more followers? Probably. His core supporters won’t mind that the speech was pre-written and that he read it from a teleprompter, a practice for which he has ridiculed other candidates; those supporters will figure he’s just doing what has to be done. And he will likely attract some undecided voters simply by giving a speech on an important topic with presidential trappings – backed by American flags, in Washington a few blocks from the White House – delivering a message that will strike many as at least plausible. With next Tuesday’s winner-take-all Indiana primary now looking crucial to Trump’s chances of going to the convention with a clear majority of delegates, attracting a few more undecided voters could make a big difference.
Trump’s main challenger in Indiana, Ted Cruz, yesterday made a very belated stab at serious differentiation, naming Carly Fiorina as his running mate. The move is a clear attempt to attract women voters, who Trump has alienated massively with derisive comments throughout his campaign. And maybe it will make a difference in Indiana, though a former Hewlett-Packard CEO who fired thousands may not seem highly relevant to the women voters Cruz is after.
The entire U.S. political class and everyone interested in leadership will draw many lessons from the 2016 presidential race. The importance of brand power, specifically of differentiation and relevance, may well be one of them.
You can share Power Sheet with friends and followers here.
What We're Reading Today
Zuckerberg proposes new share class for investors
The proposal would provide dual-class stock owners with Class C shares that have no voting power. It’s a tactic that Mark Zuckerberg has proposed in order to donate 99% of his Facebook stock to the Chan Zuckerberg Initiative within his lifetime while remaining in control of Facebook. He defended keeping Facebook in his control, as decision making – like investing $1 billion in Instagram or not selling to Yahoo for $1 billion in 2006 – would have been swayed by investor pressure.
Bill de Blasio’s inner circle gets subpoenaed
The New York City mayor’s inner circle, including chief political aide Emma Wolfe, fundraiser Ross Offinger and BerlinRosen, a consulting firm founded by a de Blasio advisor, all received subpoenas. Federal investigators are looking into whether campaign-finance laws were broken in 2014, as de Blasio campaigned to bring the state Senate under Democratic control. City Hall also received a subpoena, but de Blasio himself wasn’t served.
New York Magazine
Putin’s Russian oil exchange draws closer
President Vladimir Putin has long wanted an oil exchange in Russia. The country could potentially increase revenues from Uruls crude by not linking it to the often-used Brent oil benchmark. Russia’s largest commodity exchange, chaired by Putin ally Igor Sechin, has reached out to potential customers for a new futures market. But some are concerned it’s a way for Russia to surreptitiously push up the price of its own oil.
Valeant to make major changes to its board
Yesterday, during testimony to a Senate committee, Valeant director Bill Ackman said that the company would turn over a lot of the board. It didn’t take long, as Valeant will announce that five long-standing directors will step down. Many of the directors, like Mason Morfit, Norma Provencio, and Theo Melas-Kyriazi, were in power when Valeant hired outgoing CEO J. Michael Pearson. The board is also waiting on decisions from Ronald Farmer and Chairman Robert Ingram as they may also step down. Pearson will cede his seat to incoming CEO Joseph Papa.
Building a Better Leader
Ted Cruz names Carly Fiorina as his running mate
Cruz has resorted to this long-shot move to build some momentum for his candidacy, even as he no longer has a chance to win the majority of delegates before the national convention. Fiorina could help him with women voters. He’s in a battle for Indiana with Donald Trump for all 57 delegates.
Sanders cuts staff
After damaging results on Tuesday, where Bernie Sanders lost four-out-of-five Northeastern state primaries, his campaign cut over 200 workers. His campaign says the move was part of a natural evolution for a primary race that’s winding toward the finish line, but Sanders says he will focus much of his remaining efforts on the June 7 California primary. Experts say he’s likely coming to an understanding that Hillary Clinton will be the Democratic nominee.
Trump’s foreign policy speech touts America first
In the first of what is expected to be a series of speeches that explain his policy positions, Donald Trump signaled a goal to revamp America’s role in foreign affairs. Reading from a prepared speech, Trump said that under his leadership, the U.S. would always put its interests first but would be willing to work with European, Asian, and Middle Eastern allies, at a price.
Up or Out
Fortune Reads and Videos
Gap needs to close 175 more stores
According to an analyst, it’s the only way the company can reverse current misfortunes, even though Gap already closed 175 stores in June.
51% of voters think the U.S. primaries are rigged
And more than one-quarter of voters say they don’t understand the process at all.
SpaceX wants a spacecraft on Mars by 2018
The Dragon spacecraft would fly on the so-far untested Falcon Heavy rocket.