MD, Insights Division, Colombia
Consumer behavior is a dynamic science, which causes brands to undergo a process of constant adaptation in order to maintain a place in the hearts and minds of their current and potential customers. Understanding this is what drives Kantar, and on this particular occasion we want to take a look at the factors driving brand growth in Colombia.
Changes and challenges
Over the course of three years we have studied around 6,000 brands in the BrandZ™ study, and we have shown that in order to see a brand grow, it is necessary to promote three relational stages experienced by the buyer: experience, exposure, and activation.
Each of these phases impacts on the purchase decision process at different times: activation influences immediate sales, experience influences recurring sales, and exposure influences future sales. Superior performance in all three phases simultaneously is vital to sustainable brand growth: globally, only 4 percent of brands grew significantly over those three years, and the average growth of each brand was approximately 46 percent. In Colombia, consumers follow global trends, and in common with people in most other countries, 90 percent of people surveyed said they prefer to spend money on experiences that satisfy their tastes and needs, rather than on acquiring material goods. Contemporary consumers expect to have memorable experiences with brands, and access to information allows them not only to compare, but also rate the quality of brands.
Experience of a product starts with the moment of purchase at the point of sale, and extends to the experience of use. Although, in theory, the experience is the customer's last moment of contact with a brand, it is also the brand’s opportunity to show consumers that everything they expect from the brand is indeed reality. That is why it must be impeccable, because it is during an experience where promises can be broken and brand perceptions altered.
The perception that consumers have of a brand has great influence over their purchase decisions. In the case of brands in Colombia, there is evidence of the value of improving brand Salience, that is standing out from other brands or products in the market; this factor represents 40 percent of consumers’ decision making. Two other key areas of focus for brands should be Significance (30 percent of a brand decision), and Differentiation (20 percent). All are vital in building more robust, relevant and differentiated brands.
If we consider the role of communications in deepening consumers’ understanding of brands’ purpose, we find that in Colombia only 23 percent of consumers believe that brands improve their quality of life in some way, and just 19 percent perceive brands to be generators of welfare at levels sufficient to say that they contribute to improving the world through social and environmental causes. These figures are 5 percent below the global index on brand responsibility, as measured by Kantar.
Around the world, we consistently see a link between a brand’s share of voice one year, and its market share the following year. The more a brand invests in exposure compared to its market share, the more likely it is to grow over time. In Colombia, however, several major brands have reached their highest levels of communications investment and reach, which limits their contribution to building brand variables.
In addition to obtaining frequency of reach, it is important that every element of an advertising campaign complements every other one, across different media. No longer is it acceptable to use the same creative, with some minor adaptations, for each channel used. The strategic role of each medium must be understood. For example, television is an effective medium for generating reach, but if we are seeking frequency, it is often better to pursue this via digital media, where it is also possible for content to go viral.
And finally, it is important to call on brands in Colombia not to lose the desire to create creative advertising, to encourage them to generate innovative strategies, and to contribute to building a consumer culture.