Engaging thoughts
When the going gets tough, how will brands get going?
Votes against austerity in France and Greece last week renewed speculation that the euro may soon collapse. Moreover, the bookies tend to agree: Ladbrokes suspended bets last week on Greece leaving the euro and reported “plenty of support” at 33/1 on the euro being scrapped this year. But what might this mean for brands in Britain and their customer?
At the start of the recession, the strength of the euro against the pound made the UK a very attractive destination for European shoppers. A reversal this year with a strong pound and a weak euro would make British exporters less competitive in Europe, which doesn’t bode well for the growth outlook of the UK.
How brands react depends, of course, on the depth and severity of this new downturn. We can expect, though that the already-squeezed middle will be squeezed still further. Household incomes will come under severe pressure, only this time, there won’t be any slack on salaries to cut back. House repossessions have steadied out and are now significantly lower than in 2007. But 13 million people already live below the poverty line in the UK and according to The Trussell Trust, food banks fed 128,687 people last year, 100% more than the previous year. If the cost of food and fuel stays high while incomes remain static or fall and unemployment increases, food banks will be in even more demand.
Politically, if we reach a stage where significantly more people are struggling to feed themselves there could be downward pressure applied to brands and retailers – which made major profits in the good times – to pare down their ambitions in order to help consumers through the worst. This would be in direct conflict with their commitment to shareholders to make profit and might be unpalatable for some.
There will likely be an increase in demand for ‘value’ products in categories for every day usage – household cleaning products etc – and more so than at present across all other categories. Only the most established brands in the most established ranges are likely to be unaffected. Pressure could be applied to retailers and brands for promotional offers which provide genuine savings, rather than ones that reward you for spending more. A drift away from loyalty cards is likely to continue as consumers seek cash savings rather than rewards. And a deep downturn could largely spell the end of our flirtation with higher priced organic produce, at least for a while – though there is likely to be continued demand for reasonably-priced fresh produce.
Ironically, the downturn might prove positive for charities which have suffered from dwindling donations in recent years. Economy clothes retailers like Primark and Matalan may face stiff competition from charity shops as a new generation of ethical shoppers seek second-hand but quality products.
We often talk about the need for brands to become more personal with their customers. Those that appreciate the importance of this may find a way of incorporating their brand into targeted CSR activity – for example sponsoring or supplying food banks nationwide or clothes banks (in the way M&S are doing for Oxfam at present), which would not only create positive brand exposure for themselves and their products but could redefine their brand for a generation.
Tesco ditches the value stripes it earned
There’s a new war brewing among the big supermarkets. The battleground is ‘value shopping’ and the fight seems to be over who can make their value range look as little like a value range as possible.
Few product ranges have become as distinctive and instantly recognisable as the Tesco Value range, products marked out from a distance by the bold blue-and-white stripes of their packaging. Sainsbury’s tried it with a white-and-orange range of their own but somehow it wasn’t as distinctive and – perhaps best for them – it didn’t become as synonymous as the Tesco range did with our collective struggle to get through the recession.
However, when Waitrose introduced its sleekly packed Essentials range, I sensed it would be a game changer. There was nothing in the Essentials packaging that marked it out as a value range. Perhaps the consumer has started to feel self-conscious, even stigmatised, by pushing a trolley packed full of blue-and-white-striped goods. Maybe they feel it marks them out to fellow shoppers as struggling, as not being able to afford the top branded goods. Even in recession, we still want to keep up with the Joneses.
So out goes the blue and white stripes and in comes Tesco’s new Everyday Value range, with colourful yet subtle packaging. Although Tesco points out it’s not a straight like-for-like swap, the addition of the word “everyday” implies routine as opposed to “cheap as chips”, while the new packaging creates less negative stand-out in the trolley.
Value has been good for Tesco and good for the industry. It provided the platform for Tesco’s dominance of the supermarket sector which, together with its Finest range, enabled it to pitch against Lidl, Aldi and Asda at one end while squaring off against Sainsbury’s, Waitrose and Marks & Spencer at the other.
But one consequence of the recession is polarisation. Politicians talk about the “squeezed middle” demographic, but it’s happening in retail too. All the action is either at the economy-end of the market or at the higher-end. It’s always been difficult for retailers to operate convincingly at both poles. This latest move by Tesco may be the first step towards positioning it at the middle-higher end of the market in time for the recovery if – and when – it finally materialises.
Never knowingly downloaded
The announcement by John Lewis that it has extended its range of services to customers by launching its first own-branded broadband service marks yet another stage in the delivery of multi-service retailing by the multiples.
Broadband has become a commodity purchase in its own right over the last two years, more in keeping with the supermarket shelf than anywhere else. But aside from selling us consumer electronics, what track record or expertise does John Lewis Partnership have in the sector that would make us, as consumers, favour them over another more specialised broadband provider? And does that matter anyway?
The answer is, it’s all in the brand. The reputations of some of the pure broadband providers have become tarnished by perceptions of them being fly-by-night: offering higher downloads speeds than they actually deliver, farming consumers out to distant call centres or providing questionable levels of customer service.
John Lewis and other mulitples may be buying their broadband wholesale from one of the mainstream broadband providers, but consumers can be reassured that they, at least, are dealing with a reliable and trusted source. And they don’t come more trusted than John Lewis.
In the UK Customer Satisfaction Awards 2011, John Lewis was named Britain’s Most Trusted Organisation while also being voted Britain’s favourite retailer for the fourth consecutive year. But herein lies a potential pitfall. While the John Lewis brand encapsulates service in its retail promise, how will its service guarantee work when they are reliant on a third party to deliver the broadband infrastructure? If they are not completely in control over what they are delivering and something were to go awry, would this match consumers’ existing expectations of a John Lewis service? And if it did, would this undermine perceptions of the John Lewis brand across its portfolio?
The company starts from a strong position, though. Already they have consumer trust and the belief among their target base that they are not going to be ripped off by a John Lewis proposition. All they need to do is carry across their “Never Knowingly Undersold” price promise, make sure the broadband speed is good and that the customer service up to scratch and they could be onto a winner. One suspects that if they didn’t think they could deliver that, they wouldn’t have taken the plunge in the first place.
Turn food waste into an economic success story
In austerity Britain – where value ranges and price drops have become the norm on supermarket shelves – I read recently that households throw away 4.4 million tonnes of edible food each year.
According to figures published by the Department for Environment, Food and Rural Affairs (Defra), almost a third of all bread purchased by UK households is dumped when it could be eaten. Add to this around a quarter of all vegetables and potatoes, a fifth of all fruit and even 6.3% of alcoholic drinks.
The Flour Advisory Bureau states that bread remains one of the UK’s favourite foods, with 99% of households buying it and 12 million loaves sold each day. That’s 4.38 billion loaves a year which – at a conservative price of, say, 90p per loaf – equates to £3.9 billion a year spent on bread. Defra’s figures suggest we are wasting approximately £1.3 billion a year in thrown-away bread.
Shocking, isn’t it? And it becomes even more so when you consider statistics released by food redistribution charity FareShare, which reveal a sharp rise in demand on charities for food as people all over Britain struggle to put dinner on the table. 42% of charities surveyed reported an increase in demand for food in the past year as food prices soar and the recession bites, putting additional strain on families and people on low incomes.
So behind the stats lies the scope for a campaign for any socially responsible brand willing to take it on that could reduce our food waste mountain while at the same time helping inject much needed impetus into the economy.
In a similar vein to Persil’s Dirt is Good campaign, who would launch a Waste for Britain campaign? Sainsbury have recently encouraged people to freeze food rather than throw away; Pret does its Charity Run, where it donates unsold produce to homeless shelters at the end of each day; Waitrose supports the “Love food, hate waste” campaign… But the figures suggest that there is plenty of room for other brands to get involved.
Brand campaigns could focus on making consumers aware of the food they are wasting and how much this is costing them – creating new habits to reduce waste while encouraging them to spend their money on other things. Or they could help provide the means by which people who have a surplus of food could donate or redirect it to those in greatest need, e.g. through charities like FoodShare.
It could be bigger than food – we are a nation drowning in ‘stuff’. TK Maxx’s current “Give up Clothes for Good” campaign with Cancer Research UK springs to mind. Don’t hoard your stuff, don’t chuck it: donate it.
Following the herd to the petrol pump
In the last few days, we have been witness to an extraordinary phenomenon: the herd mentality of the British consumer.
We are at least seven days away from any potential industrial action by petrol tanker drivers which could upset the availability of fuel and yet, following government advice to top up our tanks or hoard small supplies, we set off in our droves to forecourts this week demonstrating almost Blitz-like resolve. As a consequence, the independent retailers’ group RMI Petrol reported that demand for petrol rose 172% on a single day, while diesel was up 77%. Halford’s reported a staggering 500% rise in sales of jerry cans.
Some have suggested that the panic-buying is a direct result of the government ‘nudging’ people towards specific outcomes. Perhaps, it has been said, the government needed this to happen for political reasons, as a distraction from the economy, the ‘cash for dinner’ scandal, to back Labour into a corner over union funding – or even to generate a short-term petrol duty bonanza.
But this behaviour isn’t unusual for British consumers. In 2009 Delia Smith’s Christmas television series sparked a rush for obscure ingredients. Sainsbury’s reported sales of cinnamon sticks up 200 per cent on the previous year, while Marsala wine was up 300 per cent and pickled walnuts doubled.
And it’s not only food. Earlier this year Amazon reported sales of telescopes up 491% in the three hours after the transmission of BBC2’s Stargazing Live, presented by Professor Brian Cox.
Whether it is rushing to fill up your car when there is no shortage of petrol or racing to get the last cinnamon stick for a cupcake recipe, this is behavioural economics in action. We, as consumers, are heavily influenced by other people. We tend to observe and copy what others do and, generally, like conforming. And with that, I’m off to fill up the car – like I’ve just seen my next-door neighbour do.
Does my bum look big on Facebook?
The extent to which brands are using the online medium to engage with consumers – almost at the expense of bricks and mortar retail – appears to be gathering pace.
In the last few weeks chocolatier Thorntons has announced it is to use its website as a “testing ground” for the introduction of new products across the business while Shop Direct is unveiling a virtual changing room so that customers can “try on clothes” online.
They are not the first. Tesco has a new virtual fitting room, which launched for women on Facebook for a two-month trial. It sounds like a great idea. You upload a couple of photographs to create a 3D version of yourself and try on items from the supermarket’s F&F clothing range. But is this move really going to satisfy the consumer’s emotional need to engage with a brand or a product? Surelywhen you start to take away the actual physical experience, which for many consumers has always been a part of the purchase process, the idea falls down.
Last year Polo Ralph Lauren installed a touch screen in the window of its high street shops, which you could use to pick the item you want and the size you want and order it without setting foot inside the shop. Despite positive research findings the actual usage was minimal; it was a good idea but, come the crunch, people like to touch and feel while trying on clothes – and, of course, in premium brand stores you get well informed and attentive staff.
Shopping is a social event for some people but there are others for whom clothes shopping is one of their least favourite activities. For them, the online experience is something of a godsend. Moreover, reviews online from other shoppers – good and bad – provide a guide to purchasing that you wouldn’t get if you wandered around in-store. For these types of shoppers the online experience, done well, helps them make good rather than poor purchasing decisions.
Flip the coin, if you will, to the brand or the retailer’s perspective, and you can see how online could give them access to a growing, almost global customer base that they simply would not be able to access through bricks and mortar stores.
But there is a fine line to tread on the path to online transition. How far can it go before ‘enough is enough’ and customers push back? The answer at the moment is that brands and retailers probably have to do both online and offline really well to cater for all consumer mindsets. But, while there is clearly a place for a very integrated online shopping experience, for some categories the experience counts for just as much.
For buying the weekly food shop or a DVD, going online is almost a given. But buying yourself a new suit – would you really want to put your trust in an online cartoon avatar?
Brands that get it right by 'doing it for charity'
If ever there was a win-win situation surely it is the advent of cause-related marketing; buying a product or service while making a donation to a charity at the same time. It has not only become a staple of the set-piece charity events of the year – Sport Relief, Comic Relief and Children In Need – but is increasingly finding its way into the mainstream marketing activity of many brands.
And it should come as no surprise why. The Pink Ribbon Foundation quotes a study of 2,000 people revealing that 81% would be more likely to buy a product that was linked to a cause while 85% said that they would have a more positive view of the company that made the product. Two-thirds said they thought more companies should be linked with a cause, while 80% said that if price and quality were equal, supporting a cause would make a difference to their purchase decision.
The upshot is that consumers seem to be looking for more from the brands they buy. The latest to do this is Fairshare Music which allows you to download the music of your choice with half of the profits from the download going to a choice one of 18 charity partners. DKNY, which gets the vanilla for its fragrances from Uganda, supports the work of CARE with vanilla bean farmers in the country, while running equipment retailer Sweatshop is throwing its weight behind the Microloan Foundation, to provide training and loans to women in Africa to help lift them out of poverty.
In an article in the Financial Times some time ago Tim Harford explained that there were broadly two types of giver: those who donate out of pure altruism and those who give to get the “warm glow” from having donated to charity. Harford explained that these weren’t necessarily two sides of the same coin. Warm-glow givers, he wrote, don’t think too much about whether the money they give is going to be effective whereas the altruist needs to know their donation is going to be effective. “While the altruist would want the evidence, the warm-glow giver just wants to feel the connection”, he said. The third motivation, Harford identified, was social pressure: the act of giving because we think that’s what others expect of us.
This distinction can be critical in terms of the way brands and consumers act from a cause-related marketing standpoint in an economic downturn. There is an increase in people donating their time rather than their money as a way of making a contribution, though altruists and warm-glow givers alike may be more tempted by the brand charity link. Altruists might give more in a recession because they can see the poor getting poorer and will see that more could be achieved with their donation. Those who seek the rosy glow, however – but are themselves under pressure – may well metaphorically hide behind the sofa rather than donate beyond their means. And that’s why the link between brands and causes can be so effective, because the choice is entirely in the hands of the consumer without pressure from external sources
In balancing the need to create value for consumers while at the same time offering an outlet for our ethical and charitable needs at a time when money is tight, some brands may just have created a win-win giving model for the recession.
The 'his & hers' ad campaign is upon us
Fast food chain KFC has announced its intention to roll out its first ‘his and hers’ TV advertising campaign to support the release of its ‘healthy’ non-fried BBQ Rancher burger. But is it really important for brands to target men and women separately to achieve coverage or can marketing to both sexes be less gender specific?
KFC is not an obvious candidate for gender-bending, so we’ll assume that this is a straightforward male vs. female perspective on the same proposition. It makes sense given the wealth of evidence suggesting that men and women are, in fact, different and might have a different perspective on food. Contrast this with the approach of Lynx who, launching their female range, have chosen to stress the shared territory of youthful sexual attraction for their “Unleash the Chaos” TV ad.
This all introduces a really interesting and conceptually simple way of targeting. For example, many grocery brands are now bought by men rather than just “housewives”, but I wonder whether advertising has really kept up with this in anything other than token ways. Yes, advertising might focus on a gender-less product truth or human insight that the brand addresses, but developing comms which address only a predominantly female or male or mono-gender audience must be a compromise.
However, given that KFC is embarking on two separate advertising campaigns, what happens if I, as a bloke watching “women’s TV” see the women’s version first, and vice versa? Might this give me the impression that I believe the product is aimed at women, which influences my behaviour towards the product moving forward?
This in turn could affect potential reach. One of my colleagues did some exploratory work on this for a beer brand in the US where they would shift advertising around states. Normally they would assume reach is a combination of spend versus ability to find a target population. Given the chances of a woman and a man seeing a single advertisement are about the same, a brand would have to spend twice as much (or something similar) to achieve the same level of reach as a traditional, more generic ad, although the impact you would expect would be greater as the ad is targeted. The big question is whether the impact advantage outweighs the extra cost of advertising to reach your total target.
Which brands would be ripe for this double-gender approach? First of all let’s re-imagine classically, but perhaps mistakenly, gendered categories and see what we can do with those: “male” categories like cars, technology, finance, and “female” categories like food, laundry and household cleaning. Would a more overt and genuine addressing of the female perspective on cars break the stranglehold of the “metal porn” and twisty mountain road formula? And would an authentically male perspective on household cleaning do better than resort to tired stereotypes of modern “life juggling” but still caring housewifery? Or is this an old fashioned stereotype of what advertising is like?
Things have changed somewhat since the 70s, but actually a lot of the modern gender-neutral advertising seems to ignore the gender angle on brands and products. Lots of products that are used in different ways by men and women (mobile phones for example) often feature non-gendered people of generally trendy man-woman appearance/persuasion communicating and connecting… but in identical ways.
Perhaps we should call for a refreshingly adult approach to gender, as KFC seems to be adopting. Whether because of nature or nurture, men and women are different, and whilst they increasingly use and buy the same products and brands, they use those products differently, they respond to those brands differently, they respond to emotional and rational messages differently, and they like and engage with different styles of media, advertising and content. And so maybe the age of the “his and hers” ad is upon us.
Is there really such a thing as customer loyalty?
Dunkin’ Donuts, that staple of the American mall, has just been named by Brands Keys Customer Loyalty Engagement Index as number one in customer loyalty for the highly competitive US coffee sector for the sixth year in a row. It doesn’t take a marketing guru to see that they’re obviously doing something right, but is customer loyalty a genuine phenomenon and, if so, what can brands do to influence it?
On one level, of course, loyalty schemes have as much to do with loyalty as reality television is about reality. Loyalty cards are simply promotional devices that work in both directions; as a customer I get money off my next bill and the retailer in turn collects a lot of data about me they wouldn’t otherwise have got. But is this really inspiring my loyalty?
There will always be individuals or groups of consumers who align themselves with brands with which they think they have something in common or which they feel say something about them and their status. This is particularly the case with high end fashion or jewellery brands or consumer electronics, of which Apple is the prime example.
But this aside, when it comes to brands are we really talking about loyalty or are we talking about convenience and opportunism on the part of the consumer? Loyalty as a concept speaks of our unwavering need to stick by something even in the face fierce opposition – the way football supporters, for instance, stand by their team through thick and thin.Convenience, though, is something different. I may have a Tesco loyalty card because I shop there three times a week. I may not be doing that out of loyalty, but out of convenience. If I move house and Sainsbury’s becomes my nearest supermarket, the likelihood is that because of convenience my “loyalty” would transfer to them.
It is too easy to confuse loyalty with frequency. Loyalty is much more about emotion and an instinctive reaction to a brand and this has to be considered differently.
Good customer service is certainly an important factor in brand loyalty but there has to be a good product too. Brands also have to stand for something; if you know what the brand is about and why it is right for you, you will almost always pick that brand over a competitor at price parity and, most likely, even at a premium price position. Sometimes, though, what we believe is loyalty may just be inertia. We may be inherently dissatisfied with our bank, utility company or broadband provider, but we simply can’t be bothered to switch because it seems like such a hassle.
The flip side to this loyalty question is the lack of rewards for being loyal versus the bonuses you might get for switching brands. This is more likely to occur in the services sector but there doesn’t seem to be many advantages in staying with, say, a bank or a savings provider. Often, introductory offers are better than the ones available to existing customers. The ‘savvy’ consumers are thought to be those who are the most promiscuous in terms of brand behaviour.
Whether it is loyalty or not, what is clear is that people warm to brands that show a degree of humanisation. Consumers like it when they can see a brand that displays the characteristics of its community, no matter how large a corporate it is, and avoids adopting a rather soulless “one size fits all” approach. McDonalds and Dunkin’ Donuts are particularly good at this. Although the consistency of the brand experience is paramount it is the little things that make the difference that makes customers want come back and repeat purchase.
The brand battle of the sexes
So Lynx launches a female product – does this mean that feminism has finally run its course? Well maybe not, but it has certainly generated a lot of interest in the marketing community. One could argue that in our ‘lady to ladette’ culture, it is surprising that it has taken so long for a brand which is all about youthful sexual attraction to extend its reach to women. But the more interesting questions are: Does this necessarily represent a game changer for the sector? Does it swing both ways – can female brands crossover to men, especially as the male grooming category has grown by adopting traditionally feminine products and behaviours? And are there any implications for other gendered categories and brands?
The rise of the unisex fragrance sector in recent years has shown, particularly in the bathroom, that the boundaries between the genders are beginning to blur. The impact of programmes like The Only Way is Essex on crossing over grooming and tanning products from the women’s to the men’s markets had underpinned the success of the sector. However, this has largely been on the back of discernibly male brands developing new products, rather than established female-friendly brands breaking into the men’s market.
Developing cross gender brands, though, is nothing new. It is something that Levi’s has successfully done in the jeans market and Gillette has achieved with razors, though both are examples, like Lynx, of a male brand being adapted to target a female audience. There are fewer examples of it working as successfully the other way around. Unilever’s other global personal care brand phenomenon, Dove, has arguably made the move from female to male, especially given its assertively female positioning, with the male equivalent Men+Care successfully launched a couple of years ago. However before the Campaign for Real Beauty came along, Dove was a more gender-neutral soap and its challenging of gender stereotyping has also made it something of a post-gendered brand.
It is interesting that this is a lack of female to male brand extension, while products freely travel, suggesting that there is something insecure in men’s psyche which makes ‘appearing female’ far less acceptable than women adopting some male traits. This despite years of the apparent ‘feminising’ of traditional masculinity (male grooming, male parenting, male emoting…). So it seems that it would take a brave brand to make that particular play. So where do we see more gender ambiguity in branding?
Chanel, widely perceived as a predominantly female brand, has had success winning men over to its range of watches, but less so to its core fragrance products. Success seems to come most readily at the luxury end of the market, where there is less of an obvious demarcation between male and female product use than elsewhere. Brands like Hugo Boss, Louis Vuitton, Chanel and Cartier seem to say more about the user’s status and success than they do about their gender and this seems to override any gender sensitivities.
Some companies have succeeded in developing genuinely unisex brands, most obviously in the fragrance market, whilst others, like the watchmaker Swatch, have developed as distinctly gender-neutral brands. Perhaps the future lies in this continued development of androgynous brands, like Calvin Klein, which will challenge established brand demarcations head on, both in product design and brand positioning, and may well win.
So what might this tell us about other gendered categories – cars, media, clothing, technology? Lynx’s move must question the assumption that brands targeted largely at men or women are basing their gender bias on functional needs, historical precedence, even the idea of psychological pre-disposition (which seems to have become fashionable again as the nature nurture debate lurches back towards ‘nature’ in matters of gender). So will we see hitherto staunchly ‘male’ brands such as Yorkie following Lynx and targeting a female audience and, hopefully, classically ‘female’ brands like Comfort successfully targeting men. Then surely the post-gendered brand world will have arrived.
Celebrity brand match
Using celebrities to advertise products is nothing new. Even before Hollywood legends Rita Hayworth and John Wayne took up the challenge of promoting Tru-Color Lipstick and Camel cigarettes in the 1940s and 1950s, brands had recognised the allure of being associated with the idols of the day.
So this week’s news that chocolate bar Snickers is replacing A-Team hero Mr T with former Dynasty sirens Joan Collins and Stephanie Beacham shouldn’t be that much of a story – except nobody I have spoken to since can see an overt Joan Collins–Snickers connection. Of course other seemingly uncomfortable associations turn out rather well, such as John Lydon and Country Life, while some that look solid (Tiger Woods and Gillette) can become tarnished.
And perhaps Snickers’ use of Joan Collins is an example not of direct “endorsement”, but of the way that some brands are abandoning obvious brand fit in favour of associations that offer talkability. Or maybe the brand is merely continuing to tap in to the prevailing mood of 80s nostalgia, providing a warm feeling from the past as we contemplate a somewhat chilly immediate future.
However the campaign turns out, its worth considering the role of research in informing such “irrational” celebrity associations. Advertisers might question its usefulness in such a context, but good research will be fundamental to understanding how to maximise the value of this style of campaign by exploring the appeal of an apparently unconnected character. Brands still need to ensure that they bring the right ‘face’ on board, however unusual, and getting the tone and humour of the campaign right is essential. Research will help here too.
The choice to link Snickers with Mr T was clearly well researched. Not only was he retro and identifiable to those of us of a certain age, he was also cool to a younger generation through a resurgent interest in The A-Team on the back of the Hollywood remake of the television series. It remains to be seen how well Joan Collins will straddle these various demographics.
The retail savings game
A report by the housing charity Shelter this week confirmed that almost one million Britons have taken out an emergency ‘payday’ loan to help pay their rent or mortgage in the last year. In addition, the charity also reported that seven million Britons – that’s 10 per cent of the population – are relying on some form of credit to help pay their housing costs.
With so much of the population under such fundamental financial pressure the situation necessarily has implications for brands. Consumers will not only be searching for the best bargains but will be willing to put more effort into securing them. They will also be looking for emotional pay offs: higher-level benefits such as “doing the right thing” or “being responsible” as well as more basic ‘animal’ drivers such as “competing for scarce resources” and “protecting the family”. It will be interesting to see how people’s well developed need to be part of the herd or community plays out against this background.
While brands might be tempted to introduce “value” variants of their best loved products we would caution against straying too far from accepted brand values and setting the brand up for a later fall. Launching value brands might bring some dividend now but could damage positioning in the longer term if the brand in question operates in a premium segment.
Brands could more fruitfully consider greater innovation in promotional strategy (we have seen iterations of this with retailer schemes such as Asda’s “Price Guarantee” and Sainsbury’s “Brand Match”). They could do this by applying product innovation research techniques to create, develop and test truly innovative new value/promotional ideas rather than relying on the classic well-worn path. Larger, global brands may even look to see what has worked for them in less well-off, emerging markets to see whether messaging or products for ‘poorer’ consumers might be transferable.
Or what about promoting the idea of saving money as some sort of game – rewarding consumers who shop savvy so they can continue to buy the brands to which they are emotionally and behaviourally connected. It is something energy companies have tried in the past – rewards for being more energy-efficient. Let’s see if it can work in retail too.
Getting out the crystal ball – what does 2012 hold in store?
The outlook for 2012 is not exactly optimistic, so I’ve dusted off my crystal ball to try and see what the next twelve months holds for brands, marketers and consumers. Continued economic trouble will see consumers remain cautious in their spending. For people with little that will mean an everyday focus on best value, while for the better off it will be more thrift and localism.
Everyone will be looking for comfort or escape – as well as some sense of hope. I think people will become quite cynical and will wish for a greater sense of community and support but will look after number one – this will translate into even further decreasing brand loyalty and continued “forced experimentation” to get the most from your cash.
Supermarkets will maintain their push to appear on the side of the consumer, with the public either sticking with the store closest to them – because they can’t to afford to drive to a cheaper one – or favouring the more budget supermarkets if they are within close proximity. We anticipate a return to make it yourself food and there may be a push to support local shops in light of the Portas Report, provided the price differential isn’t too great.
As times get tougher, there may be a greater focus from brands on helping consumers improve their mental wellbeing as part of a healthy lifestyle. Culturally we will continue to be increasingly mobile, less patient and more stressed.
Brands will need to stay close to their customers to see where they are lapsing in their purchases. It may be a time for brands to revisit fundamental questions about their relationship with consumers in an effort to consolidate existing customers but more importantly build a new base as well.
Research into why buyers buy, why people stay loyal or move away from certain brands during periods of austerity, and why some people have never bought a particular brand will provide a level of consumer understanding that could inform post-recession planning now.
In the marketing and research sectors we anticipate pressure to drive more value from every project; engaging consumers to get better data and therefore understanding, which ultimately enables us to inspire marketing teams with the ‘voice of the consumer’ to make better, more successful products. In a recession, price becomes a dominating factor, leading to further heavy promotions. Brands, though, can be better served understanding the more subtle drivers of purchase to be more profitable, as well as the obvious BOGGING-OFF that we know and love.
Meanwhile, we will see an outpouring of ‘Britishness’ coinciding with the Olympics and I think brands will interpret this in lots of different ways; from the reactionary (Rule Britannia nostalgic values), through to the inclusive (modern multi-cultural Britain) and the purely aesthetic (the Union Jack everywhere). Link that with our floating off into the Atlantic away from the EU if you will, but the Brit’s love affair with exotic products, tastes and new brand experiences will continue.
Austerity Christmas: Hope and traditional values dominate
A qualitative research study that we will publish this week shows how Britons plan to reject traditional consumption and spend Christmas reconnecting with the things and people that matter most to them. The study paints an emotional picture of a traditional Christmas as respondents talk about looking forward to “just spending time” with those closest to them.
Consumers seem less concerned with magic and spontaneity, more with practicality and planning. There is more emphasis this year on planning and buying early as a way of budgeting at a time when thrift has become more than merely a lifestyle choice. Christmas is obviously about enjoyment and escape, and a certain degree of excess is traditional – but, in keeping with the subdued times, our respondents have said that a sense of modesty and restraint is the order of the season.
And in response to the prevailing sense of economic gloom, consumers appear to be responding best to brands that are using their advertising and marketing activity to capture the traditional spirit of Christmas and tapping in to the power and comfort of ritual.
In terms of brand advertising, the spot that was cited most often by our respondents was Coca-Cola’s “Holidays are Coming” ad, featuring a convoy of illuminated Coca-Cola trucks snaking through wintery hills on their way to town. This ad was spontaneously discussed as a signifier of Christmas, and welcomed as enthusiastically as the families in the advertisement welcome the Coca Cola truck.
The John Lewis spot – a playful inversion of the classic ritual of waiting for Christmas Day – has tapped most particularly into our desire for a return to a traditional sense of giving. Even the more ambiguously received M&S advert captures a hope of a future where “dreams come true”.
Five themes emerge from the study which have significance beyond Christmas, long after the decorations have been put away. These are:
- a profound need for hope;
- a sense of post-materialism;
- a focus on people and things closest to us;
- the comfort of ritual; and
- the idea of the rewards of practicality, planning and hard work
So what should brands take away from this seasonal analysis? The message from our respondents is quite clear. Articulate hope and a positive long-term vision as consumers are looking for an inspirational light at the end of the tunnel. Reflect the way that consumers have, in some ways, temporarily lost faith in materialism and focus on values rather than things. Focus on the local, facilitate family, be active in communities and, at very least, continue to overtly support the British economy with products created and built locally. Brands should continue to tap into rituals which offer familiarity, comfort and trust for consumers and create promotions which reward planning and effort, as well as “hard to ignore” deals.
Don’t do down the innovators in our society
“Britain rock bottom of world innovation league” was the headline from the business pages of The Independent this week, covering the Thomson Reuters Top 100 Global Innovators survey. Not an entirely helpful story at a time when the economy is creaking and we’re all doing our level best to keep creating wealth and jobs.
So I’m here to take issue with the findings. The survey has been put together based on patents: volume, global reach, how frequently a company has a patent granted and the so-called influence of those patents.
But patents shouldn’t be the only barometer of innovation in our society. Innovation is endemic in many UK companies, from the smallest to the largest. Simply registering hundreds of patents does not make a company successful; they have to be insightful and relevant patents – and a few good ones will always be more useful than a truck load of bad ones.
Few would argue that Google is one of the world’s great innovative companies; perhaps even a model for a 21st century brand. But Google is the perfect example of how innovation doesn’t always lead to success. Just think of Google Buzz, Google Page Creator, Google Audio Ads and Google Wave, to name but a few ideas that have failed to make a dent. The jury is still out on Google Plus.
Here in the UK, there are plenty of small and medium-sized business innovating within their own sectors, but at a time when multi-nationals dominate western economies and are making in-roads into developing markets too, it can be difficult for these smaller brands to bring their innovations to market. Some older, bigger brands meanwhile are ‘renovating’ to keep alive what they already have; this may mean replicating the innovations of smaller companies but with added reach and budget. True innovation is always going to be more ground-breaking than renovation but it doesn’t mean it will be more successful.
And innovation isn’t necessarily about making new things – innovation is a state of mind, a culture. In this sense, I think many of our businesses are ahead of the curve.
When it comes to research, the devil is in the detail
I read some interesting, if slightly perplexing, research today, which led with the fact that around 80% of brands are not regarded as beneficial to factors like health, happiness, financial security and environmental protection.
The research on Meaningful Brands, by Havas Media, was conducted among 50,000 people in 14 countries, including Brazil, China, France, Germany, India, Japan, the UK and US.
Some of the findings may have been superficially interesting but, when given thought, actually posed more questions than answers.
For example, the research was reported as saying that:
- Most consumers “would not care” if 70% of brands were to “disappear”, while only 20% of brands were seen as having a positive impact on shoppers’ sense of wellbeing.
- 30% of respondents in Latin America felt brands exerted a favourable role in their lives, totals falling to 8% in Europe and 5% in the US.
- 65% of people had a “very strong attachment” to Coca-Cola, but only 35% thought it improved their quality of life.
But what does any of this actually mean?
Generally 20% of brands make up roughly 80% of any market – not only because they meet most consumer needs but because they also out-market the competition. It should therefore come as no surprise that most consumers “would not care” if 70% of brands were to “disappear”.
We have a mantra at Engage Research: “Just because we can ask something, doesn’t mean that we necessarily should.” When you are designing a piece of research, it is essential to keep it focused on actual business needs in order to deliver relevant customer insights that genuinely serve the company’s commercial objectives. Anything less and the relevance and value of the research have to be called into question.
A sound, fundamental understanding of consumer behaviour and market dynamics is what underpins most successful marketing strategies – but for such research to have any true value, it must deliver practical, tangible insights that can inform either new product development or marketing planning. Research always needs to go deeper than the headline-grabbing numbers.
Baby Seven Billion and her message to brands
So the world has its seven billionth occupant, designated by the United Nations to have been a baby girl born earlier this week in the Phillippines. That 7bn is predicted to become 8bn by 2025.
On the surface this indicates a growing potential global market for multinational or aspiring multinational brands to target. But the details behind the headline figure – India to become the world’s most populous country, Zambia’s population to double while others decline – are just as important in revealing how brands may try to tap into changing demographic trends.
Although the BRIC countries have been on most multinationals’ radars for some time, the news of population growth may lead to a new raft of initiatives. But population growth alone may not be a good enough reason to ‘chase a country’. Having worked on various washing powder launches in India in the past, one of my colleagues at Engage came up against the issue of home washing where wooden debris from the cooking stove was used as an abrasive to clean clothes instead of a detergent. Some 25% of Indians were still doing this and, as it is effectively free, they were understandably reluctant to spend money on something branded.
There are other lessons to be learnt here. Take Nokia, as an example, which has been spectacularly pushed to the sidelines of the mobile market as western consumers look to smartphones by Apple, Blackberry and HTC, whose stock market value recently surpassed Nokia’s. The threat to the brand is double-edged because in emerging markets like India, where Nokia is still the most trusted mobile phone brand, low-end local handset makers are beginning to attract an increasing number of customers.
It is important to get beneath the cultural, emotional and functional reasons for brand purchase decisions. Cultural and economic issues can impact on how brands develop differently in different territories. In some markets western brands are too expensive and cheaper local alternatives are preferred; in other markets brands can be a status symbol, creating different sorts of opportunities.
In Japan, for example, it has always been cool for younger people to wear western brands. Over the last 20 years or more, younger Japanese have tried to differentiate themselves from traditional culture and become more outward looking. Branding has been a big part of it and it is a process that may well be replicated in China in the coming years.
Brands have to button down the insight for a product in emerging markets just as they would in any other country. This is equally applicable to brand marketing strategy. How can you leverage social media in a highly populous country with limited internet access? How can you tap into cultural norms to make your brand’s arrival seem evolutionary rather than revolutionary. It’s not only about the potential size of the market, it is about the potential for brand acceptance in those markets and the two are not necessarily in tune with each other.
Design and customer insight are not mutually incompatible
British industrial designer Sir James Dyson, inventor of the dual cyclone bagless vacuum cleaner, was recently quoted as saying: “Steve Jobs has shown you ignore good design at your peril and that breakthrough products come from taking intuitive risks, not from listening to focus groups.”
At first glance this may sound like an obvious statement: that good design emerges from the maverick, creative mind and that research in the marketplace serves only to stifle that creativity and genius. However, on second reading, it also looks not only a little elitist, but also that the designer or the brand (and in Dyson’s case the two are, of course, inextricably linked) either doesn’t trust or isn’t interested in the judgment of its potential customers.
It will come as no surprise that I don’t agree with this. Ultimately research tells you what you set it up to do. You have to ask a question and create sound and effective research to deliver the answer. Framing research properly is key to getting the right result.
But, of course, focus groups are not the only available research tool. An experienced researcher will be able to point clients in the right direction. Effective research can either improve or kill off an idea, perhaps saving the brand thousands in development costs. Research will highlight broader market issues that maybe can or can’t be addressed but which, either way, would be crucial to success in market.
A colleague of mine recently worked on a product where a sample of 800 respondents said they liked the idea but wouldn’t buy it due to perceived credibility and price issues. The research was showing it to be a high risk launch, but the manufacturer disagreed, pointing to one guy in one focus group who said he would buy the product.
As well as classic research tools that “test” ideas, we also use techniques and approaches which engage with consumers in the nurturing, development and co-creation of ideas. Consumers, treated with respect and given the appropriate tools, can be just as intuitive as contemporary boffins like James Dyson.
Focus groups may not be the best tool for the job when it comes to new product development, but to go to the opposite extreme and ditch the many sophisticated and subtle customer insight approaches now available to brands is to wander into a marketplace blind. And who has the available cash to do that in the current economic climate?
Brands and the cult of personality – what to learn from Steve Jobs
I started writing this blog before the sad news of Steve Jobs’s death had been announced – but this, if anything, brings the subject into even sharper focus. The launch of the iPhone 4S earlier this week prompted suggestions that, while Apple’s new CEO Tim Cook presented well, the whole event seemed lacklustre without the presence and force of Jobs’s personality.
In truth the disappointment surrounding the iPhone 4S launch had less to do with Steve Jobs and more to do with expectations being raised too high for the product to live up to.
Apple will continue to flourish without Jobs because it has the culture in place to enable it to do so. Big personalities should be able to render themselves redundant once successful.
So how great an asset can the force of one personality be to prospects for brand success?
In a sense, Apple is something of an anomaly. It used to be all about the tribe, the cult of the creative collective, but latterly has been heavily associated with its cult leader, Steve Jobs.
Other brands, however, are personifications of their owners. Many of these have been grown by the person at the helm and the personalities of the two are intrinsically linked. Imagine Virgin without Branson, Ryanair without O’Leary, Dyson without Dyson or EasyJet without Stelios Haji-Ioannou. In the case of Virgin, the link is there even though Branson doesn’t own every Virgin business, and in the case of EasyJet, it persists despite Haji-Ioannou’s disputes with the firm. These personalities have values that people associate with the brand, such that the brand personality becomes an extension of their own over time.
Brands that consumers can clearly associate with something or someone tend to do better in the market than woollier ones. Indeed some of the more emotional attributes are the hardest to cement with consumers – which is where a personality can be helpful.
This is not true for all brands, of course. Some brands, like John Lewis, thrive despite the absence of personality. John Lewis benefits from being democratic, with a ‘there for you’, ‘whatever you want us to be’ sort of feel, rather than a ‘this is me, take it or leave it’ notion of a personality-led brand.
Of course the values of the ‘leader’ are also often reflected in the employees of the business as well. If you get it right, having a strong character or leader with clear values and a vision can drive a brand faster and stronger than others and carry consumers with it. Brands represent who people are. Buying Apple products has made people feel cool and different. They have bought in to the chilled, relaxed feel that Steve Jobs embodied so well.
Maybe Apple will find it tougher than we think without him. Only time will tell.
On the first day of Christmas, the product sold to me....
I’m no Ebenezer Scrooge but I am writing this on a crisp, bright early Autumn day – and the supermarkets aisles dedicated to Christmas have started to appear.
News this week is that Air Wick, the Reckitt Benckiser air freshener brand, is launching a £3m Christmas campaign to support its new colour-changing candle. This got me wondering about the changing importance of Christmas in the marketing calendar and how brands can best prepare themselves for it.
The importance of Christmas to certain sectors is undeniable – for the gift confectionary sector, the Yuletide season represents more than half of annual sales.
As researchers, we would usually have to have results before Christmas for trade presentations early in the New Year, ready for the following December.
But it is no longer just about the obviously seasonal products. Look at the shops on Christmas Eve, with people panic buying for gifts as well as food, bits for the house to make it look ready for the big day (seasonal air freshners maybe) and new clothes for parties. Getting ready for Christmas is a multi-sector pre-occupation.
In terms of timing, research and Christmas can be tricky. For all research you want to try and make the situation as typical as you can – so you would avoid the Christmas season itself for a lot of projects. However, with a product designed specifically for Christmas, a special effort may be required to make the research situation look and feel a bit Christmassy.
As with all good marketing, there is a need for brand fit and there are bound to be a few seasonal shockers jumping on the bandwagon and I wonder if brands with apparent “integrity” or “authenticity” are harmed by being all Christmassy or whether uncharacteristic seasonal brand behaviour is forgiven, rather like uncharacteristic seasonal office party indiscretion.
Anyway – as a person that loves Christmas – I do notice when a brand goes above and beyond or is just a little bit different. So amid the Christmas clutter it is important to stand out and research can be key to finding ways to achieve such cut-through.
And with that, I’m going sit back and enjoy the pre-Yuletide scent from my mulled wine and cinammon apple air freshener.
View results 10 per page | 20 per page | 50 per page
