Stand for a higher purpose
Brands too narrowly defined by what they do may thrive when their specialty is in high demand. But they're vulnerable as fads or even trends change. In contrast, brands with a higher purpose enjoy consumer permission to introduce other relevant products and services. This phenomenon was especially evident in technology, where some B2B brands struggled to expand from device-driven strategies, while brands with a broader purpose—make life easier, better, simpler—enjoyed greater flexibility. The best brands are built on an ideal that encompasses not what people buy, but what they buy into.
Make the purpose as salient and global as the brand
Good citizenship is not optional. Brands that sustain greatness over time connect to a fundamental reality: people want a better life for themselves and for the people closest to them. In an interdependent, transparent world a better life must be available to everyone. For global brands, the rising middle classes of Africa, India and Latin America represent not only potentially lucrative markets, but also the opportunity of the century, to help millions of people rise from poverty.
Be meaningfully different
The key word is meaningfully. Across categories, the most valuable brands generally are meaningfully different like this: They've discovered important customer needs that they've filled in ways that make the brand stand out and keep customers returning. In luxury, meaningful difference may pertain to craftsmanship or exclusivity; in technology, it could be about product efficacy and style; in oil and gas the highest quality engineering skill may be a meaningful difference. Meaningful means making a difference in the life of the customer, which helps the brand gain market share, maximize profitability and sustain success.
Multitask like your customers
Time-stressed consumers multitask. They want the products they buy to multitask. This trend is most apparent in soft drinks and personal care. Having a refreshing beverage is fine. But it seems better—and serves a purpose beyond hydration and thirst quenching—if the beverage also boosts energy and adds vitamins or replenishes carbohydrates. It's the magic of the "and." In personal care, consumers are turning to cosmeceuticals, products that provide the beauty enhancement of a cosmetic with pharmacological properties that improve skin, for example. Not every brand needs to multitask. But all brands need to be aware how the marketplace has conditioned customers to expect solutions that perfectly match the way they live their lives.
Address changing consumer habits and concerns
Responding to consumer health concerns, carbonated soft drink brands are introducing juices and other beverage options and the fast food brands are adding more healthy options to menus. There's a gap between what consumers say they want (healthy drinks and food) and what they often choose (taste and calories). But habits are changing over time, especially among the young. And despite what people do today, what they say may indicate what they'll do tomorrow. Brands need to listen closely.
Make good and better as if it's the best
Consumers who buy good and better increasingly expect something similar to best. Now, the newest mid-market car models often are equipped with the kinds accessories that not long ago distinguished luxury brands. With electronic entertainment and guidance wizardry broadly available, luxury brands differentiate their cars with refinements, like the quality of the interior finishes. This democratization of quality is likely to raise value expectations across categories.
Be the message and the medium
Marshall McLuhan had it right when he said, “The medium is the message.” But now the aphorism is flipped. The message is the medium because of several contemporaneous developments, including: the advent of social media, the rapid and wide dissemination of information, democratic access to audiences, and the emergence of big data. Brands have at least as much ability to organize audiences and deliver relevant messages as traditional broadcast and print media.
Be genuine and honest
The advantage of traditional media is objectivity and authority. In contrast, brands have a particular point of view and an agenda. The key is not to pretend otherwise, but to be genuine and honest. Social media opinions can be harsh. The corrective is not to sanitize them, but to respond as appropriate and use the opinions to improve product and communications.
The industry parlance has moved from multi-channel to omni-channel to where no single word captures what it means for a brand to be present everywhere. Meanwhile, brands across categories are working to get it right. The luxury brand Burberry creates live fashion shows that are broadcast in its stores and on its website. Walgreens, the US drug store chain, aligns is website and mobile presence with 8,000 store locations that customers can visit for shopping or pick-up. The challenge is execution, harmoniously aligning all of a brand’s physical and digital representations. The strategic use of technology, mobile location based services and big data can provide a competitive advantage. Getting all that right reinforces brand experience.
The customer comes first. The customer is always right. This is the conventional wisdom. It contains some truth and misses some truth. As banks attempt to restore customer trust lost during the financial crisis, they’re working to improve internal morale, especially among employees who face customers everyday and ultimately represent the brand most directly. It’s an equation championed by the US retailer Whole Foods. The brand asserts: Happy, enthusiastic employees satisfy customers; who produce the sales and profits that the drive stock price, which rewards shareholders. It sounds like the new conventional wisdom.
Treat customers as individuals, not demographics
Intelligent use of big data enables brands to treat customers as individuals rather than demographics. Sales people with tablets that instantly access a customer’s buying history and preferences can respond more personally. Communication can be more individualized. A customer spending an average amount of money over time might receive a personalized thank you, while a higher-spending customer might receive an invitation to a special event. The data-driven ability to understand and respond to customers individually crosses most categories. Until now, for example, insurers focused more on acquiring new customers than on introducing more products to existing customers. With the ability to quickly analyze data, insurers can anticipate when a homeowner insurance customer may be ready for a life policy. Brands have an opportunity to develop mutually rewarding, individual long-term customer relationships. Customers, not demographics, spend money.
Be ready for the next new and shiny thing
Because people felt uncertain last year, new and shiny didn’t quite tempt them. Even in technology, a category known for innovation, brands shifted to iteration. That’s because brands generally didn’t want to take big risks when consumer confidence was still fragile and a wallet opened only slightly could snap shut quickly. Incremental change was enough to keep consumers happy and keep pace with the competition. The period of incremental change won’t last forever, however. The next new and shiny thing needs to be ready before consumers realize they want it.
Keep up with the fast growing markets
The BRICs took a breather. The slowdown revealed key distinctions in their levels of development. Brazil experienced mixed conditions: Monetary policy stimulated growth of the consumer sector but hurt banking, commodities and exports. With Brazil hosting two global events—the World Cup and the Olympics—in the next three years, growth will intensify. In China, the government’s drive to develop a consumer society will continue to increase purchasing power well beyond the largest cities. At the end of 2012, India expanded direct foreign investment, allowing multiple brand merchants, like Walmart, to operate as retailers. The opening of India’s economy, slow and deliberate as the country manages internal competing interests, is inexorable. The rate of GDP growth in Russia actually outpaced the other BRICs. With the entrance of Russia into the WTO last year, and the Olympics in Sochi in 2014, Russia is ready for more Western brands and the development of Russian brands. The BRICs breather won’t last forever. And then there’s Africa.
Invest in brand when others hesitate
It’s always difficult to invest when the economy is troubled, sales are slow, budgets are being cut and caution, even fear, becomes contagious. But after the gloom, when the sun returns, the only question is whether a pot of gold waits at the end of the rainbow. That depends on investment. When the recession hit, the sales of US home improvement retailer Home Depot already were pressured because of internal problems, including service levels, which tarnished the brand. Home Depot invested to fix the problems and restore its strong brand. In the BrandZ™ 2013 Most Valuable Global Brands report, Home Depot was a top riser for the second consecutive year. Its brand value rose 43 percent, following a 31 percent increase a year ago. Strong brands need tending, but they respond—often quickly.