CHIEF COMMERCIAL OFFICER, BRAND
I had just returned from my holidays and was feeling the effects of jetlag and an empty stomach when I jumped on my racing bike. While before holiday I could easily kick away lots of watts, it just didn’t work out the day after my return: 25 minutes in, I was forced to slow down and take a lower pace. Despite having momentum before the holidays, now it simply did not work.
And guess what? The same thing happens to brands. Despite ambitions, plans, or good results from the past we see that many brands have struggled to keep the momentum going for them. We recently compared 3,900 brands that grew or declined over a three-year time frame. And we found that while 6% of these brands grew initially, only 6 in 10 of this 6% were able to maintain its growth. Why is that?
Well, it has to do with keeping momentum. When you don’t exercise, or if you have not eaten well, you will not be able to keep up. Many brands fall in into a similar trap. Companies may start out with a long-term vision. The founders have an original idea and they can see how their business will compete effectively within the current market context. But as companies go along that path, they increasingly get drawn into short-term performance and management. Incremental thinking replaces innovation as leaders worry about making the next quarter’s numbers. Companies become more risk-averse. By the time the company matures—if it gets there— the company doesn’t have the vision for something completely different that will drive it forward through the next 10 years. That’s why businesses and brands should strive for a ‘’small company’’ mentality to maintain a vision of future growth.
Fortunately, there are some great Dutch examples of brands have embraced unique visions of excellence, and have charted their own category rules in order to grow not only today, but also in the future.
KLM, for instance, is now suggesting alternative means of transport for its own services. While KLM acknowledges that we all have to fly every now and then, sometimes there are better alternatives to reach people. For example, by conference call, or a high-speed train. The fact that KLM has become an advocate for these alternatives is unexpected, but it might help its business in the long run, especially if KLM invests in a high-speed train network across borders. And from a branding perspective, KLM gets to position itself as a friendly, responsible, and honest company that is meaningfully different.
Heineken, meanwhile, has observed the rise of individual small craft breweries in recent years. And Heineken has decided, rightly, that it could not credibly give the same craft-beer feel to its own (big, global) brands. So instead of fighting the trends, they started Beerwulf: a platform where beer lovers can order craft beer from many local breweries. Beerwulf takes on logistics, platform, shipping, and stock risks. One nice detail: Because Beerwulf knows exactly who is ordering, small brewers can see where their “fanbase” is across the globe. Heineken, for its part, still earns money, as they put a mark up on beer they sell through the platform.
A shark needs to keep moving or it dies. And a shark is always on the hunt for its next meal. If you’re serious about success, as a company you also have to constantly keep moving. If you don’t stay hungry and keep moving forward in business, your competitors are going to come and take what’s yours. Or worse: you will just become irrelevant for your customers.
The lesson for me? Keep on exercising, even during holidays. And stay hungry.