In consumer packaged goods and consumer electronics markets, brand management has traditionally been the driving force behind business growth. Gaining a consumer’s loyalty and connecting with them on an emotional level helped created consistency and certainty for both the company and the consumer.
The journal Strategy+Business, published by consulting firm Booz & Company included a story titled, “The Trouble With Brands”. Booz has been conducting brand research for many years, and they are finding that most consumer brands are not creating value. Where brands ARE creating value is when consumer experience has been greatly enhanced. This combines two major areas of innovation focus (brands and user experience) and requires deep analysis and understanding by a company’s brand and senior leadership teams.
The Booz study indicates that brands which maintain value today posses, “energized differentiation” which consists of conveying excitement, dynamism and creativity. This thinking is not just for consumer products companies, but B2B companies that rely on their corporate brands to drive revenue growth as well.
Booz states that the key elements of brand equity including trust, awareness, regard and esteem are falling for many brands. Companies are spending tons of money to prop up these values and apparently it isn’t working for many of them. This is a trend that has been building over time and is not a short term blip due to the current economic conditions.
What is this saying? It means that people are not being INSPIRED to buy.
The reasons Booz offers for this trend include too much capacity, lack of creativity, and loss of trust. Too many companies are selling too much stuff, people are affected by very high quality experiences from leading brands, and some business leaders are letting us down with their unethical behavior. What appears to be happening is that people are being more choosey about what they buy and why they buy it.
The gist of the Booz analysis is that brands better step up their efforts to provide what people want, and to have their enterprise leaders behave better if they are going to succeed.
The question to ask is, “how can I energize my brand?”. Keep in mind that a person’s relationship with a brand has three main areas: attraction, occasion of use, and extension. Attraction is more than advertising and logos, it is more visceral and indicates your level of awareness of the human drivers of your purchasers, where they purchase, and why they buy. People don’t just use a product, they carry it home, store it, and combine it with other products to do jobs you may not even know about. Remember when Green Stamps and Frequent Flyer Miles provided unique value? Extending your customer’s positive and unique experience will need to combine the internet, social networking, and integrating your products into the lives of your users and consumers more deeply each and every day. Brands must deeply touch human emotional, social, cultural, physical and cognitive drivers if they are to inspire people to buy what you are selling.
Finally, the Booz study identified that market leaders are setting new expectations in the buyers’ mind of the way things should be. They change the rules of the game and align their brands with human value systems. Leaders find new market adjacencies across markets, users and categories. In short, market leaders find out what their customers are willing to pay for, and it probably isn’t what they originally suspected.
Roy Luebke is an innovation expert focused on discovering new, customer-driven opportunity areas to help define the future of a company. He is inspired by knowledge and learning, and applying structured tools and methods at the crossroads of strategy and innovation to achieve business growth.