Corn dogs, fluffy pillows, and burned flags: Fixing a broken brand

There is a lot going on here at the Milken Institute Global Conference so stay tuned..

Let’s do a quick gut check. I’m going to say two words, and I want you to tell me if your gut response is warm ‘n fuzzy, or coldly distrustful. …Okay, ready?

Time share.

Odds are, upon reading these two little words, your reaction is decidedly negative. Maybe worse. And that decidedly negative reaction was precisely the challenge facing Stephen J. Cloobeck when he became Chairman and CEO of Diamond Resorts International, a time share company with almost 25,000 guest beds in 26 countries. Named “Sunterra,” the brand was notorious for high-pressure sales tactics and poor follow-through, and unanswered customer complaints riddled the company’s reputation online. (Perhaps worst of all were the hideously-Technicolor bedspreads and pillows. More on that later.)

How could Cloobeck reinstate trust in his brand— in an industry that often carried the connotation of a four letter word?

Rather than using innovation to cleverly reinvent on his brand, Cloobeck did the opposite. He stripped the brand back to the basics, earning trust from customers on a daily basis, promising and delivering a hospitality experience he calls “the power of yes.”

As a whole, Cloobeck’s brand repair is less about marketing or operations, and more about hand-to-hand combat. A few examples:

• Rather than “rebranding” the company, Cloobeck began by “unbranding” it. How? The Sunterra logo was on everything the company did, including the pools, windows, and parking signs. To send an unmistakable signal to all employees and shareholders that the old Sunterra was gone, Cloobeck had a “flag burning ceremony,” torching the logo.

• Happy kids make for happy parents. For instance, looking at the menu, most kids weren’t eating the $9 macaroni and cheese entrée, because it didn’t taste familiar. Cloobeck changed to good ol’ Kraft, charging only $2. Rather than scrawny corn dogs, he switched to juicy Perdue products. With those seemingly small details, kids were happier, parents were happier. Nice.

• Everyone likes a yummy pillow, but the pillows at Sunterra were icky foam. And the bedspreads? “Utterly gross,” declared Cloobeck. His overhaul included a personal perusal to find the most exquisitely cozy pillows for his guests.

• Rather than outsourcing the training for his resort managers, he trained them. Yes, he trained them. Personally. He personally taught them that he didn’t want frilly things on toilet paper. No swans or origami. He wanted simple, basic, clean hospitality that his guests could rely on.

• In an industry of quick sales schemes and run-arounds, Cloobeck was perhaps most obsessive about his 550,000 customers’ long-term satisfaction. How obsessive? In every sales presentation, in every lobby, you’ll find Stephen J. Cloobeck’s personal email address. (Don’t believe me? It’s Stephenj.Cloobeck@diamondresorts.com)

It seems there’s almost nothing this CEO isn’t willing to personally improve by reestablishing trust.

There is one obstacle to expansion, however, that not even Cloobeck can alter. “I need more Hawaii,” he says. “And less Orlando.”

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