It’s always a challenge to write a year-end blog that has meaning. However, we were inspired by two unrelated sources – the Interbrand Best Global Brands Summit (held on October 9th) and a recent Wall Street Journal article on tuna brands published on December 2nd.

How do these two seemingly unrelated things inspire this blog? They highlight two things that are vitally important for brands to never forget. First, a great brand experience is a direct result of a powerful and relevant brand positioning strategy that is driven by (evolving) customer and category insights. Second, as we’ve often written, “if it ain’t broke, break it”. This is in reference to the fact that brands must always innovate or reinvent themselves, in ways that are consistent with their brand positioning, to stay relevant. Or they run the risk of extinction. 2018 has certainly been a year where many brands have struggled to stay relevant with their current and potential customers.

Why the Interbrand Summit is Relevant

This 19th annual summit celebrates successful brands and the value they bring to their customers and how they’ve paved the way for innovation and growth. This year’s theme was “Activating Brave”. The key insight of this year’s 100 Top Global Brands study was that to be sustainable, brands must make bold and transformative moves now, and in the future, to stay relevant. Interbrand Managing Director, David Binns noted that brands must take “bold short term action in pursuit of clear and aligned long term vision… and have the courage to intercept the future, not just flow with it.” This means that brands, even successful ones, cannot coast. Far too many brands, large and small, coast on industry trends while others simply fly blind. Those that understand how their customer needs and overall category dynamics are changing, and drive innovation to disrupt their industry based on those changes, will be successful in the long term.

Interestingly, Bob Pittman, CEO and Founder of iHeart Radio said, “there’s a difference between a name and a brand. None of us are rational when forming relationships”. There’s a big difference between brands who only focus on awareness (Sony) and those who define a brand experience that forges a relationship (Apple). Apple is the #1 brand in the 2018 Top 100 Global Brands report – just saying.

The big “aha” at the conference was that we need to talk to our customers. Duh! The twist in what we talk to customers about is focusing on the challenges or pain point’s they are facing; by doing this, innovative brands can make meaningful improvements to the brand experience. Brands often want to reinforce the positive, while missing blind spots or white spaces that may offer great opportunity. Understanding your customer and category, and how they are changing, are the hardest things to do in developing a continually relevant brand proposition.

For example, one fascinating insight coming out of the conference was the evolution of brand pricing models. This year, 29% of the brands on the 2018 Top 100 Global Brands list have a subscription model vs. none in 2009. This is clearly an issue for consumer product brands that are more transactional through retail outlets, but it could be more fundamental in the B2B space. Cisco CMO Karen Walker noted “We changed our model from “single product sales” to 80% subscription. If we don’t disrupt ourselves, someone will do it for us”. Reminds us of our “if it ain’t broke, break it” perspective – instigate smart change and innovation before others do it for you.

Brands’ need to be nimble was another conclusion at the conference. Aston Martin CMO Simon Sproule noted that even luxury brands must behave more like start-ups. “How do you wake up as a heritage brand and make it relevant?” he said. Aston Martin’s answer? “By becoming the world’s first all-electric car company. Now that’s “Activating Brave”.

Many luxury brands are rethinking how they engage with customers. They want to move customer thinking away from buying products to having rare experiences. Though it was debated a bit, luxury brands are finding powerful ways to connect with customers to make their purchase more meaningful. For example, the fashion industry is one of the biggest global industrial polluters. Companies like Gucci are forming partnerships with energy company EON to create assets and products that embed in a company’s product lifecycle. Environmentally conscious Gucci buyers can see exactly where their product purchase came from – thereby providing greater transparency and piece of mind to the customer. Using this type of data enhances the brand-customer relationship and experience.

bottomline marketing know your customers blog post

Overall, key takeaways at the conference were based on the obvious reinforcement of core brand principles (e.g., understand your customer, know where your industry is going and stay ahead of it, etc.), and the need to apply them in new and exciting ways by many companies who need to reinvent themselves. Which brings us to the classic commodity category, tuna.

How’s Tuna Connected?

Last week, The Wall Street Journal featured the dilemma of the top three tuna brands – Star-Kist, Bumble Bee and Chicken of the Sea. For all intents and purposes, these companies missed the memo on “Activating Brave” and have, in essence, been asleep at the wheel for the last 30 years – basically riding on the notion that fish is a “healthier food option”.

A couple of key insights about the tuna category and tuna consumer behavior:

  • Per capita consumption, of canned tuna has declined 42% since 1996
  • Sales volume has declined 4% over the last 5 years
  • Consumer tastes (particularly millennials) are shifting to fresher, less processed food options (e.g., the Poke phenomenon)
  • Behaviorally, millennials don’t want to open cans and drain product – let alone use a dish and utensils. Many millennials don’t even own a can opener!
  • Finally, only 32% of consumers 18-34 purchased canned tuna vs. 45% of those over 55

And smaller brands focused on safer, more sustainably caught and higher quality fish have nearly doubled market share from 3.7% in 2014 to 6.3% in October 2018.

Over the last few years, the big three tuna brands have finally woken up and introduced some key innovations – tuna in pouches (no draining), meal kits with trendy flavors, and expanded their product line to salmon and even chicken – however, they sea change (pun intended) in consumer needs and behavior (see above).

Contrast this lackluster brand experience with how other brands have continually improved their overall brand experience – like Tide (offering pods and liquids that are great for High Efficiency machines and line extensions like portable stain removal pencils) – or have defined how an industry might better engage customers – like Tesla.

In summary, the Interbrand Summit reinforced that successful brands must do three things:

  • Deeply understand their customer
  • Be at the forefront of evolving customer and category trends
  • Deliver innovation (product, packaging, payment model) that’s aligned with changing customer behavior and is consistent with the overall brand strategy

This is how brands will win in 2019 and beyond. We’re optimistic about the future of brands, but everyone has a lot of work to do. Let us know how you plan to “Activate Brave” for your brand in 2019 – or call (619) 752-2510 or email us if we can help!

Pin It on Pinterest

Share This