There are whispers in the wind that the next recession is on the way. Recessions usually require brand planners to learn on the fly to keep their value proposition alive. All the assumptions of business as usual need reassessing.
Recessions create a window of opportunity for questioning what drives consumption behavior, creating new learning. This is the gift of adversity. But, markets today are so fast moving and dynamic in every way that an exhaustive evaluation of your brand positioning should be ongoing. But it rarely is. Why? Because it can seem like too much work and there are far too many other things vying for a marketers attention.
But, there is a way to quickly and intuitively assess your brand’s position. At least to the point that you can develop solid hypotheses about what should be researched if additional research is needed. It simply requires assuming an informed consumer’s point of view in assessing the subtle energy elements of your categories marketing mix, trying to honestly give credit where credit is due to any brand that is performing admirably. If you are reasonably well informed of the competitive dynamics in your category and you are intellectually honest in how you perform this exercise it can take less than an hour and provide valuable strategic brand planning insights.
What are the implications then of a recession on branding? How can we apply this knowledge to get ready for challenging times?
Leo Burnett, one of the nations leading ad agencies conducted a national survey (1,000 people) at the time of the start of the last recession to see how shopping values and behavior may have changed. In this survey it was found that 82% of the public began carefully examining whether or not the brands they buy were worth it. 33% of the public had become much less brand loyal than they used to be. The great recession caused more people to trade-off or trade-down than trade-up for a higher quality or higher priced products in most categories. 40% of the public said they were avoiding status symbols because they were deemed to be out of touch with the times. 34% saw former necessities as luxuries. 32% saw former essentials as products that they can do without. These kinds of shifts in segmentation and psychology can be taken into account in how you assemble marketing mix elements.
Brand drivers are primarily associated with feelings. Unique, strong and positive feelings generate brand affinities. These are warm feelings that predispose a person to choose one brand over another when they are in a shopping situation. If you understand how changing category dynamics affects brand perceptions then you can anticipate new paths to success. Most marketing campaigns are short-term sales campaigns they are not long-term brand image building campaigns. Off-price promotions can spike sales but cheapen the image of your brand. Leadership brands spend more on long-term demand creation initiatives than do brands that favor push marketing tactics.
Even in recessionary times brands can build equity investing in their core values. Through the up and down of business cycles Nike has continually invested in delivering on its core values of authentic athletic performance. For any high interest and high involvement category (like sports footwear) there is an evaluation exercise that can work well to develop strategic insight into using elements of the marketing mix to build brand equity. Its particularly useful for brands competing in the culture industries, including personal technology, shoes and apparel, beauty, fashion, auto and transportation, restaurants, beverage, hospitality/tourism and education.
You start by self-assessing your own response to your category for a missed positioning opportunity. WHAT EMOTIONS ARE YOU FEELING when you are shopping and when you are actually having an ideal product or service experience? For example lets look at running shoes. If you are a dedicated runner what feelings do you notice most about your shoes when you are having the best run ever?
- Heightened energy
- Non-Intrusive sensations
When we performed this exercise for the Nike Running category we uncovered that the ideal running shoe draws no attention to itself on an ideal run. If you notice your shoes, something is wrong. There are no friction points – the fit and feel are ideal and glove like, the cushioning is ideal allowing you to stride out without pressure points. In exploring the hierarchy of benefits of the ideal shoe comfort rose to the top as the benefit sought most. From this realization the original Air Huarache was created. This was a shoe designed from the inside out. The materials and location of stitching seams were carefully chosen to reduce pressure points and friction and maximize comfort. This design innovation was then taken to other product categories.
This brings up a question surrounding how you evolve your brands value proposition. Is your brand acting as the cultural protagonist for the ideal experience in your category like Nike did here? Has any brand discovered, defined and taken the positioning high ground in your category? If not this high ground is still open to take. All you have to do is uncover it. It’s there waiting for you to uncover. This kind of evaluation into latent and tacit needs allows you to tune-up your marketing mix in changing times to keep your value proposition and demand high.
If the market is in the midst of shifting brand value propositions what do you do? If you study what’s shifting with more depth of understanding than anyone else you’ll discover new opportunity. This is possible if you re-assess the value of your offering through how marketing mix elements are changing. This kind of assessment can be facilitated with a simple exercise.
Below is a Brand Position Evaluation Grid to help you assess your brand compared to the competition. The list of brand attributes provided is a short and simple list. This list can be expanded to more precisely define any brand. The placement of the marketing mix elements on this grid is largely intuitive. If you feel you don’t have the insight needed to complete the grid then you need to do some category research to try and understand which brands and products are selling the most and which benefits consumers are seeking the most.
Brand Position Evaluation Grid
Look at this chart as a grid to plot how you (think & feel) consumers are evaluating brands. Plot where you intuitively feel the marketing mix elements fit on this chart. The level of importance defines the vertical axis and where your brand stands in relation to the best brands in the category defines the horizontal axis. This is meant to be an intuitive exercise that you can perform in a few minutes. It assumes that you are aware of the product benefits sought most and the relative market share and product offerings of the major brands in the category. Give each marketing mix element a letter to make it easier to plot on the chart. Then analyze your positioning strengths and weaknesses. Create brand initiatives to build on your strengths and remedy weaknesses. In the above example you feel that customers feel your brand is behind in offering the best value for the money, the best quality and the most convenience. These are clearly weaknesses in your marketing mix that need initiatives to overcome them. The plot above also indicates that this brand has no unique strengths that it can leverage. An old truism in branding is that you first need to identify your strengths and then build upon them.
Competitive Positioning Dimensions (These five elements were plotted on the above chart)
- Most Value for the Money
- Best Quality
- Best Design
- Most Convenient
- Brand delivers intangible values that resonate most
Consider how you might tune the overly simplified architecture of engagement (above) to bring it more in line with your business concept and with how consumer values are driving market behaviors. Market dynamics and value perceptions are constantly in flux, not just in recessionary times. But, the perception of customer value can be reduced to a very simple formula…
VALUE = ———-
Quality in this formula contains all the values & features that differentiate your brand to make it the brand of choice. In recessionary times a general truth is that many categories become far more price sensitive. They reduce costs and price and don’t invest in brand building initiatives to help generate a higher level of value…if they perceive the demand isn’t there. There are niches for many market segments however, even in recessionary times. If all the competitors in your category are going more downscale, this is an opportunity to make a brand statement at the higher end. Often a high end image can drive take down product styles and prices. Nike uses this strategy brilliantly.
At any time the appeal of your brand can be tuned up by playing with the elements in the marketing mix. But before you put a new brand strategy in place it is imperative that you have an accurate assessment of your strengths and weaknesses in the marketplace.
Stephen Spielberg once told Quincy Jones that the most critical part in the production of a film was the scoring of the soundtrack. The soundtrack sets the emotional overtones for each scene, cuing the feelings, mood & tone of the story. People primarily come to movies to have an emotional experience. The feeling tones in music add the critical dimension to the overall experience of the film. What is the quality of the feeling tones your brand is creating and broadcasting to the world? If you were the brand manager for Samsung or HTC smartphones could this be one of your weaknesses in the marketplace?
One interesting business case to study is Apple and the iPhone. According to the WSJ in July 2015, Apple has taken 92% of the smartphone industry profits and it sells fewer than 20% of all smartphones. How does it do this? You could use the Apple iPhone to practice the brand positioning grid exercise to list and plot the iPhones key elements, features and brand benefits. Under the Apple brand elements list here’s an interesting list of brand attributes (for your consideration) to be plotted on this chart. To accurately plot these on the chart requires that you are up to speed on all the campaigns in the category and that you are emotionally and intellectually sensitive and honest about campaign nuances if you work for one of the brands in the category. Periodically breaking down the power of campaigns, product features and overall perceptions of value provides the deep insight needed to develop new brand initiatives.
- Most salient (stands out)
- Most relevant (talks to consumer on a personal level)
- Most resonant (strikes emotional chord, creates + feelings
- Brand that has most developed ‘Human Face’
- Brand Identity that generates the most goodwill
Responsiveness / Adaptability
- Most current innovative use of technology
- Innovative use of fabrics / materials
- Beauty of Design Details
- New community building features
- Integrated Design Values with other products
- Clear view of target audiences & how to reach
- Clear view of consumer / category drivers
- Clear view of brand positions in category
- Translation of brand values into resonant stories
- Clear view of the Brand SWOT in category
We could have a longer list here of Apple’s brand intangibles. This exercise in the real world of planning would be more exhaustive, leaving no important stone unturned. Additional insight in Apple’s unique brand strength in the smartphone category can be gleaned by looking at the following chart:
Why seek to add value at the top of the pyramid – at the Soulful Branding level? Increasing your brand’s emotional resonance to wider circles of people supports market share and sales growth, premium pricing, loyalty and brand extensions. It also makes your brand more resilient in recessionary times or times of competitive adversity. Given an option people support brands with admirable character traits. Soulful Brands find ways to appeal to feelings not just rational thoughts. They get the basics at the bottom of the pyramid down cold then add intangible layers of value to improve the quality of the brand relationships. Clearly Apple has done this with the iPhone. They have differentiated themselves in their physical features, communications style and service experiences. They are seen as sharing values with the community, periodically becoming protagonists for worthy causes. They anticipate the future and stay in tune with the times. Basic branding at the bottom of the above pyramid only employs the bottom two rungs. Basic branding provides what is expected. Basic branding focuses more on offering lower priced products and competing more on lower price. Pricing power weakness is often experienced by basic brands in recessionary times. In the smartphone category all the brands that are losing money are primarily engaged in marketing mix elements at the more basic levels.
More insight on the topic of creating intangible brand value can be found in Soulful Branding – Unlock The Hidden Energy in Your Company & Brand, Jerome Conlon, Moses Ma & Langdon Morris, FutureLab Press 2015. This book presents a paradigm shift in what the art of marketing & branding can become at the highest level.
Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Licensing and Brand Education