| July 02, 2018
Based on analysis of huge attitudinal and behavioral data sets Kantar Millward Brown finds that meaningfully different brands grow faster than average and can command a price premium. But how do you know whether a brand has the potential to grow faster than average?
Kantar Millward Brown is fortunate to have access to big data sets that measure the progress of different brands over time because it allows us to get deeper insight into how brands actually do grow. As I noted in this article perceptions of difference are a signal of growth potential. Relative to their existing customer base, brands that grow are more likely to be seen as different from the competition – declining brands less so.
But that is not where the story ends. ‘Excess differentiation’ – stronger perception of difference than expected given the user base - does not mean a brand is bound to grow. To generate growth the brand owner needs to position that difference in a way that makes it meaningful and salient to new customers. And not everyone will realize that a brand’s difference is meaningful to them at the time they answer a survey, they will likely only do that when shopping. However, for brands that do have ‘excess meaning’ this implies that the value of the brand is readily appreciable to people before they even start shopping the category.
Meaningful difference can also be limited to a buyer segment. For instance, BrandZ data for Tesla shows how awareness of the brand has risen from 66 percent in 2014 to 87 percent in 2016. In the context of luxury cars Tesla has always had ‘excess difference’ (over twice the category average) but lagged on meaning. Why? Because the brand has extended awareness beyond its core fan base and many people do not find the idea of an electric car relevant or appealing. Of those aware of the brand a steady two in five would not consider it. Presumably to appeal to these people Tesla will have to overcome the fundamental barriers of range and recharging anxiety, in addition to the other more typical things people consider when buying a car.
So, if you want your brand to grow as fast as possible, first, find a difference with the potential to be meaningful to existing and new customers (you cannot afford to leave existing customers behind in the pursuit of new ones). Communicate why your difference is likely to be meaningful and make the brand as salient as possible against relevant needs and occasions. As salience grows keep an eye on whether meaning is keeping pace with usage. If it is in line or exceeds its usage then your brand is realizing its growth potential. Continue to makes its difference as meaningful and salient as possible in order to grow further.
Marketers cannot just think about their brands at a point in time. They need to think about the interaction between attitudes and behavior as a flow over time. While the dynamics will vary dramatically from one brand to the next and one customer to the next the overall pattern is clear: growth comes when a brand creates a difference with the potential to be meaningful and then makes it as salient as possible. Does this make sense to you? Please share your thoughts.