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Brandwave-logo-6.png |Strategy Design | february '15
02.02.2015
By Carole Ayoub, Brandcell

To be successful a brand needs to stand out from its competitors by promising relevant yet distinctly different benefits to its target market. It also needs to convey these benefits in everything from its brand name and identity to packaging and product performance.

By carefully selecting these benefits the brand not only sets itself apart as the preferred provider but also as the only viable solution for its customers’ needs.

In other words, consumers are convinced this brand alone delivers what they’re seeking and they won’t accept substitutes even if it is not available. It is through this differentiation strategy that the brand becomes, in the minds of consumers, unique.

Take a look at the retail landscape today, though, and you’ll find that more brands than ever before are vying for attention, and, the degree of differentiation between one product and another has been diminished. In such a cluttered marketplace, a brand needs to work even harder to stand out, and having a distinctive name becomes more important than ever to asserting a brand’s status as in a class of its own.

In Lebanon, where a recent scandal sent shockwaves through the population, a number of brands may have learned an additional lesson about the pitfalls of not having a distinctive name. When a list of food brands that had been found to have contravened health regulations was released by the Health Minister, the public reacted with horror as the realization dawned on them that the food they had been buying and consuming for years from trusted names had been contaminated or past its sell-by date.

This scandal also triggered some reactions from a cluster of similar brand names that had initially adopted what is known as the “me-too strategy”. It’s a strategy that can seem smart to start-ups or emerging companies, who adopt the rationale that customers may be easily duped into thinking they are buying the products of the larger, more successful brand; however, these newer brands lack the potential for progressive branding as no two brands can own the same concept in the consumer’s mind.

Contrary to popular thought, the imitator’s fate is sealed by the similar sound of their name, which casts them into a default position. While the promoters themselves may believe that their brand is a challenger to the market leader, the consumers merely perceive it as an imitator.

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When these brands adopted the “me-too strategy”, their eyes were fixed on the quick wins and easy gains but overlooked the risks involved with tying their destiny to that of the established brand. Just like a marriage is for better or worse, so these imitator brands found themselves in the wake of the food scandal having to communicate and explain to their customers that despite the similar name their brand was in fact different to the other brands that stood accused. Yet, for all their proclamations of being safer and cleaner, consumers remained blurred and confused and this undoubtedly impacted their behavior and perception of those brands.

For these brands such a public debacle could or should provide a branding lesson and be the awakening point for the initiation of a proper rebranding and re-positioning exercise to gain back their customers’ confidence and differentiate in the right way while delivering on their values of honesty and transparency to demonstrate these are more than just words but rather a prime commitment never to be betrayed.
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05.02.2015

by Shobha Ponnappa

Brand strategy trends for 2015 are both easy and difficult to predict. Going by what we’ve seen through 2014, a lot of last year’s trends are hardening. But still, when experts aim to predict for the coming year, they are cautious. They know we’re dealing with two notoriously fickle factors: technology and the social media.  Three well-known brand strategy specialist authors of articles in Forbes.com, Huffington Post and SmartCompany, as well as the trend forecasts of the branding agency Landor weigh in on their predictions.

From Forbes.com’s article titled “11 Marketing Trends To Watch For In 2015” by Avi Dan:

Transparency will become the most important tool of marketing.

Consumers are going to continue to exert power and influence. The idea of radical transparency is something that few brands are taking advantage of now, and most brands fight it. Next year the best brands won’t be those with the best stories, or sort of made up fictional stories, but those that will give an accurate and real time picture of what they are doing in the interest of the consumer, at any given time.

CMOs will become Chief Simplifier Officers.

Most companies create complexity, especially even as the landscape itself is turning more complex. They’ve arranged themselves in endless new vertical silos, by geography, product, or function that hamper them when it comes to working more closely and with the free flow of ideas. To optimize consumer and customer engagements, CMOs will begin to put silo busting on top of their agenda and begin to think holistically about the company’s overall value proposition, integrating messages and insights across business units, geographies, and functional groups.

We will witness the emergence of the marketing technologists.

Too many companies think in terms of digital marketing. Instead, they should be thinking in terms of marketing in a digital world. The best marketer in a digital world would be the marketing technologists, people with heavy digital DNA and technology acumen. They will be integrated seamlessly with the marketing groups and will play an important role in how marketing strategies are developed and applied.

The winners will be adept at agility marketing.

Social media produced a different, more elusive consumer with short-term thinking. Marketers are now chasing their daily meanderings in “likes”, “shares”, “tweets”, click-through rates, and ever more immediate but pointless metrics. The best marketers will have ever more consumer data, capable of faster adaption, shorter lead times, and always-on, real-time marketing. Instead of the next month or next quarter the focal point for the winners becomes the next hour.

From the branding specialists Landor, and their article titled “Landor releases 2015 brand trends:

The individual, not the masses, becomes the brand target.

Thanks to epic advances in capturing consumer data and breakthrough manufacturing techniques that make smaller production runs more economical, businesses will create specialized offers and subbrands to meet consumers’ desires for personalized products. For example, Coca-Cola Israel recently printed 2 million individually designed labels to prove its consumers are one of a kind. And, Holiday Inn is starting to shift its brand strategy toward more customized experiences that meet individual needs—from business travelers and families to young couples and adventurous singles.

3-D goes beyond movies.

The advent of 3-D printing technology enables brands to forgo uniform packaging in favor of creating custom designs to connect with consumers and stand out on store shelves. Captain Morgan 1671 special-edition blend took this approach and exceeded sales expectations with a distinctive pirate-shaped and weathered glass jug.

The name game, short and simple.

With more noise in the digital marketplace and less time than ever to capture consumers’ attention, brands will continue to streamline the path to sales and that includes a shift back to basic, clear, relevant naming solutions. More monikers will have universal, easy-to-grasp concepts (think Uber and Square) that also make good URLs. Apple, who dropped its iconic “i” naming convention, and Google have already transitioned to this elementary approach, putting greatest importance on their recognizable master brands by placing them first, followed by simple product descriptors: Apple Watch, Apple TV, Apple Pay; Google Glass, Google Wallet, Google Play.

Brands as your best friends.

Good-bye slogans and catchphrases. Today you can’t sell without a story—and it better be authentic. Whether it’s websites, tweets, or texts, brands will use straightforward dialogue infused with honesty and emotion. We’re talking plain, straightforward honesty in communications — like Zipcar who has zoomed past the rental car competition with an approachable voice that speaks like your best bud.

From the Huffington Post’s “Advertising and Tech Trends for 2015” by Jeremy Wilson:

Rise of the Sensors.

You name it. Next year someone will put a sensor in it. They have been slowly making their way into communications and services over the last two years – initially driven via Android but accelerated by Apple adding it’s iBeacons to the game. We are starting to see an infrastructure rollout that will drive broader awareness and use via mobile. These beacons act as triggers that allow for smarter interaction with an environment – for instance, if I walk into a store a beacon will know who I am and what department I’m in, sending me a notification for an in store promotion based on my past shopping history. There are multiple major sports stadiums across the US currently installing networks of beacons so we can expect some cool executions, expect to see beacons used a lot in interactive OOH and sensors attached to athletes for live sports analytics.

Health Tech & Wearables Go Mainstream. 

Sure, everyone has had activity trackers for years – but with open platforms bringing all that data together and consumers starting to share it with their doctors – get ready for an explosion in this space. This data will be leveraged to consistently add real value in our lives. Smart watches will start to appear on wrists throughout the year, brands and apps will rush to shrink their content into what is being known as ‘glanceables’ – small snackable content formats that can be viewed on a watch or a Google Now card. My favorite quote on the Apple Watch is from Aza Raskin, Head of Innovation at Jawbone: “In a decade, only the affluent will be able to afford to be disconnected. The iWatch et al will start sexy and end as a shackle.” Look for the unplug movement to clash with the emergence of smartwatches.

Selfies Get Serious.

Next year it’s time to up your selfie game – 2015 is when the selfie really gets tech. Hyperlapse, Drone shots, and connected devices that can trigger the camera on your phone are becoming mainstream and offer whole range of new perspectives for us to present ourselves to the world. Can Google Glass stay in the game without a selfie strategy?

More Ambitious Native & Branded Content.

I have to give ‘Native’ the award for the most overused buzzword of this year. Look for many new Native ad formats to emerge as it continues its charge in 2015, but who will it go too far? Some people will start to call brands out on it as the lines between editorial content and advertising become too blurred. This year we have seen quality TV shows funded entirely by brands, my bet is that in 2015 we’ll see a brand fully fund a scripted feature film. There is already loads of product placement but I’m talking the primary production backer. Fueled by the ability to debut straight to streaming distribution and inspired by Netflix’s plans to debut their own movies directly on their platform, I can see some brands making a smart impact within film.

And finally, from the SmartCompany’s story by Jackie Crossman titled “Marketing trends that will rock 2015”:

Integrity.

David Chenu, general manager of marketing services at Horticulture Australia, believes the next year or two is not about technology change – although he says that will still occur, even faster than currently – but will be more about style, substance and the essence of what is communicated. “Consumers relish integrity and purity of communication,” Chenu says. “The integrity and honesty of brand communication will be the answer to resonate through continuing, confusing clutter.” Jono McCauley, director of creative strategy at Elevencom, is in total agreement.
“In 2015, brands that ‘sell’ less and ‘do’ more will be the ones that pull ahead of the pack,” McCauley says.
“Consumer-controlled media filters out the sellers and takes notice of the doers. Doers are always innovating and solving real consumer problems in fresh and interesting ways. If the doing is clever enough, it sells itself.”
McCauley warns marketers should never underestimate their customers. “Living this strategy involves being totally transparent and surprisingly honest.”

Consumer power.

The customer as an evolving, increasingly savvy and “highly empowered individual” is a theme reiterated by Gunjan Allen, marketing development manager at Airtrain. “Today’s consumer has access to a wealth of information from numerous channels and that makes them more connected, but also more fragmented,” Allen says. “A brand needs to connect in that consumer’s world to be taken notice of. Brands will be welcomed into their consumer’s life if they’re on the same page and share the same thoughts, needs and ideals.” Lynne Ziehlke, the market development manager at the Australian Macadamia Society, is also nuts about the customer. “It’s a case of back to the future with the customer at front and centre as the hero,” she says. “Social media has made everything so transparent that the best thing you can do is have a great product and credible narrative.”

Influencers.

Byrnes predicts a continued increase in the power of digital influencers. “Digital Influencers will become a more widely used and recognised resource for digital marketers. With influencers acting as an impetus to their audience, brands and marketers will learn to turn their efforts to specific individuals to connect with a new audience of potential buyers rather than their target market as a whole.”

Visual storytelling.

Looking ahead, Gunjan Allen believes visual storytelling will take the concept of ‘storytelling’ to a whole new level. “Technologies like Blippar will further enhance customer-brand interaction, creating videos and experiences to help achieve the cut-through that brands need,” she says.
“The clever marketers are also realising that media is now consumed on the go and the mobility of devices now allows brands to reach their consumers at the right time and at the right place – a trend that will continue to grow in 2015 and beyond".

original article via shobhaponnappa.com

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05.02.2015

by David Meer, Edward C. Landry, and Samrat Sharma

A new approach can help CPG companies introduce products with the right features, price, and packaging. Consumer packaged goods (CPG) companies have a big problem: They have almost no idea which of their new products will end up being popular with consumers. Despite big data, despite a decade of heavy investment in innovation, despite chief innovation officers and efficient R&D, failure rates for new products have hovered at 60 percent for years. Two-thirds of new product concepts don’t even launch. One reason is that the retail environment has become far more complex. E-commerce continues to upend long-established business models, and consumers are shopping less at supermarkets and hypermarkets and more in convenience stores, at discounters, and online.

What’s more, although CPG companies are extremely good at the early stages of innovation—identifying promising areas of growth and creating new product ideas in those areas—and at the later stages of testing concepts and commercializing them, there’s a conspicuous hole in the middle of the process. They don’t have a clear grasp of which combinations of features, packaging, price, and even labeling will persuade consumers to make a purchase. They’re like triathletes who are world-class at swimming and running, but terrible at cycling.

There’s a way to fill that hole, but it won’t be easy.

Based on our experience, we think it will require progress in three key (and intertwined) areas. None of the three will work without the other two, and all will compel CPG executives to rethink aspects of their traditional business model.

First, companies need to adopt dynamic modeling to gauge various combinations of features. When companies test a product concept today, they’re limited by the relative primitiveness of the tools available to them, such as consumer concept testing and market structure analysis. Testing a preset combination of options (for example, the cinnamon-flavored cookies, in six-ounce individual packages, at 79 cents per pack) produces a basic thumbs-up or thumbs-down assessment as to whether the product will be financially viable. However, the results apply only to that combination. If you change one element, the test results become much less useful. Worse, the testing is expensive and time-consuming, with turnaround times that are measured in months, which makes testing every single combination impossible.

Ideally, companies should be able to test various combinations more dynamically, adjusting the flavor profile, pack size, price, labeling, distribution channel, and any other aspect of the value proposition—even the brand name. Developing a simulation model that can evaluate a wide range of scenarios by altering the various elements and seeing how each factor affects the outcome while the product is still in the development stage is an effective way of doing so.

How much more would consumers pay for low-calorie cinnamon cookies? Would they prefer eight-ounce packs? And should the cookies be sold at a convenience store, a big-box retailer, a warehouse store, or online (or all of the above)? The right model would break such product propositions into their component parts, reassemble them in novel ways, and estimate demand for the new combinations. This in turn would require detailed data on which features consumers value, how much they’re willing to pay for those features, and where they’re willing to make trade-offs.

In addition, simulation models need to deliver more actionable results. Rather than providing just a basic yes or no, the results must break down revenue, volume, and margin contribution. If a new product is going to take market share from another player, the model should let the company know where that share will be coming from, at what price, and through which channels. Importantly, the model should also indicate how much volume is incremental and how much is simply cannibalizing the company’s other offerings in the same category.

Although similar models are already being used in industries such as financial services and technology, CPG companies have been slow to embrace the new analytics. In fact, the reverse has happened: In response to cost pressures, CPG companies have systematically disinvested in analytics and insights teams. The limited resources CPG companies seem to have are being spent in areas such as social media and mobile marketing. But firms that are serious about innovation have to start the process by investing in foundational tools. And they will likely find that these investments pay for themselves over time.

If firms are serious about innovation, they have to start by investing in foundational tools.

Second, companies have to develop priorities based on their capabilities. Companies don’t start product development with a blank sheet of paper. They have critical advantages in areas where they focus their investments and attention; other areas can be either outsourced or set aside. Once a company has clear insights about which features consumers value, and how much they value those features, the next step is to figure out which of those insights it can actually implement, based on its capabilities and resources.

For example, some companies are good at developing new flavor profiles, and can easily launch spin-off products (adding toffee to the cinnamon cookies, for instance). Others are good at packaging innovations or cost reductions that lower prices. Still others have strong distribution capabilities, and can get products into new store formats quickly. Whatever its strengths, a company should prioritize its innovation ideas accordingly.

Concurrently, this step provides companies with valuable insight into which areas they should concentrate on developing next. Coming up with ideas that are hard to implement because of a lack of relevant capabilities should influence a firm’s future investment priorities, enabling it to build new capabilities that would ensure competitive advantage in the future.

Finally, companies need to make organizational shifts to put these insights into action. CPG companies need to reorient their org charts so that the innovation function collaborates more directly with marketing, sales, and the supply chain during product development. Many companies think that these four functions collaborate already. But the truth is that they work from different perspectives, with varying definitions of success and incentives, and at different stages in a product’s development. Innovation wants to get new products from the drawing board to market, while marketing is busy trying to get consumers to open their wallets. Sales focuses on persuading retailers to give new products shelf space, which in turn can help stimulate consumer demand. And the goal of the supply chain is to maximize efficiency and minimize process proliferation. The objectives overlap, but they’re not identical. As a result, products in development can travel far down the tracks before problems surface.

CPG companies would do better to use the insights they generate in the first step (through dynamic modeling) and the priorities they establish in the second (understanding their capabilities) to create a common set of facts and objectives that all four functions can agree on.

In some cases, this will mean restructuring lines of authority, incentives, and other aspects of the organization. A dramatic step? Yes. But it is necessary if companies are to make sure that these critical functions are working together.

Some leading CPG companies have started to implement this new approach to innovation. For example, one packaged-food company had spent 18 months working on a preservative-free version of a product. One of its competitors had already introduced a similar product, and the company feared market share losses. But with the official launch date only months away, the company learned that two major grocery chains had decided they would not carry its new product, in part because the competitor’s preservative-free version didn’t appeal to their customers. Firm leaders scrapped the product, treating their investments as a sunk cost.

To avoid repeating that mistake, the company shifted away from trying to innovate by following the competition, and toward an approach based on a richer understanding of consumers’ desires.

It started by running a dynamic analysis of several product options. It found that although “preservative-free” wasn’t a sufficiently attractive incentive for consumers to open their wallets, “natural” (meaning no artificial ingredients) would be. R&D had originally said the natural product would take two years to develop, but a deeper look at the company’s capabilities and priorities revealed that the team could actually complete the product’s development in just six months.

In fact, a discussion between the R&D team members and their counterparts in sales and marketing revealed that R&D had been receiving so many new product ideas that it used “two years” as the default timing for all of them. The company was able to identify other innovations with clear potential—including a superpremium line and new packaging—that could be brought to market quickly. In the aggregate, these innovations enabled the company to grow sales at a faster rate than the competition and to improve profitability in the category for the first time in three years.

If this example shows anything, it’s that CPG companies can’t afford to throw ideas at the wall and hope one of them will stick, even if they are trying to imitate a competitor. Chances are, your rivals don’t have any more insight into what consumers want than you do. This new approach should go a long way toward fixing that.

original article via strategy-business

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