Why is it that some brands are always leaders, and others are always followers? Why is it that some brands are always successful, whilst others are not?
In the company where I worked previously, we had a saying: “It’s not the things we look at, but the way we look at things”. Behind this phrase there is a deep philosophy, rather like saying, “Is the glass half empty or is it half full” it implies that the way in which you look at something determines what you see and how you will react to what you see. Many people read the sign to the left as saying ‘Paris in the spring’ rather than ‘Paris in ‘the the’ spring’, this is because we ‘assume’ what we see rather than really analyse what is in front of us.
It follows then that any design project has to start with and real audit and analysis of a brand, it’s competition, the category and market within which it has to perform – looking objectively, rather than ‘assuming’. For it is only by going through the process of looking at our client’s brands in an objective way that we can have an clear view that exposes problems or opportunities, which can help create real success in the market.
It’s also about understanding the need to be aware of the market conditions that surround design work, for example, in these difficult times of financial crisis, crucial to building success, is understanding the motivations of our client’s main client: The consumer. With more than 50% of consumers today spending less than before the financial crisis of the late 2,000’s , consumers are clearly shopping with much more attention and care than ever before. Cocooning themselves against the crisis means, they go out less, they eat at home more often and have changed their buying habits. We see consumers, trading up to more premium products, to treat or reward themselves, and trading down to value products, where they can save money on everyday purchases. Of course, the end result is that there is a real pressure on the already shrinking middle market.
Then there are private labels who, continue to grow in strength every year since the 1960’s, crisis or no crisis. They too have responded to the needs of the consumer by expanding the classic three-tier offer (premium, mainstream and value), to many different and specific tiers of product positioning and by developing quality products and packaging that attract consumers by directly answering consumers changing values. They do this because they understand clearly, whether consumers shop for brands or private labels, their buying behaviour has been radically influenced by the economic crisis. But is also, is being shaped by many other factors related to the insecurity of the financial climate, including more focus on family, health, nutrition, quality, and a desire for familiarity and trust.
Clearly, private labels will continue to develop and improve their offer, and we will see from them much more investment in the creation of quality products, in building their brands and improving packaging. They will create their own brands and with it real brand equity that consumers will inevitably come to value.
Already, different surveys throughout the world show that around two thirds of consumers think that private labels are real brands, not coming from the supermarket at all, and this perception is making competition even more fierce on the shelf.
So how do I see the future for manufacturer brands? With the prospect of a shrinking middle market, a more aggressive private label offer, you may well ask, how can the manufacturer brand survive?:
First, I believe brands need to realise that “their brand is their business, much more than their product is”, products can and will be copied by the retailer and ‘will’ be sold cheaper. Only investing in the brand itself, can offer the chance of security and longevity by answering the consumer’s need for familiarity and trust. By investing in building your brand, you will not be linked to a single product type, which will give you the added opportunity to be flexible and adaptable to the changing needs of the consumer, putting your company in a position to create new and exciting offers and potentially expand the brand portfolio.
Secondly, brands will need to re-define what it is they sell. Ask for each of your product brands, are you in an area of stiff competition with private labels or do you have something original and different to offer? For those of your products that do have something original and different to offer, I would suggest that you focus all your attention on. You will need to weed out your weaker offers, so that you can concentrate your spending only on your strongest brands. This will in turn allow you to be in a position to invest in equity building for these chosen brands, by improving the consumer experience, innovation and creating real differentiation.
Thirdly, brands need to invest in packaging design. They need to understand how the market has changed and redefine marketing priorities. In my view, after getting your product and distribution right, branding and packaging should be your first priority. Why? Well, Unilever’s own research estimates that 62% of shopping trips are now quick trips, which implies that people are shopping for less time, but clearly more often. Add to this the fact that we know, two thirds of purchasing decisions are being made right there in the store, and packaging becomes your unique opportunity to speak to consumers on a daily basis, in an environment where your brand is on show every day, and in front of the consumer at every visit he or she makes to the store. Your packaging also becomes a part of a consumer’s life by being further exposed daily in the kitchen or on the breakfast table in the home. It’s no wonder in a recent article for The Design Management Institute in the USA, Rob Wallace wrote“Package design is the single most effective and cost efficient communicator of a brand’s core identity”
Retailers are well aware of this and consequently we have seen how they have built up their private label market share steadily over the years, by mainly using just the packaging as their main vehicle of communication. So, it just makes sense to invest on a much more serious level in your packaging if you are going to have a chance to play, ‘the same game on the same pitch’ as the retailers. For too long manufacturer brands have looked at packaging as the little brother to advertising and promotion, I say, it’s time for a change! Time to rethink a strategy that clearly isn’t working, when retail brands just keep on taking more market share year on year.
The philosophical phrase, “It’s not the things we look at, but the way we look at things”, allows an objective view and a way to gain a clear understanding of the changing market around us. Whilst there was a time, when advertising ruled, when it was the principle vehicle for commanding the consumer’s attention, persuading them to go into the store and ask for a product by name. Today however, this has all changed, there is just too much media for a product to have such influence through advertising, too many TV channels, too many magazines, radio stations and websites etc… Supermarkets and hypermarkets have now become the place where consumers make their final choices, and the package has become the key player in influencing that choice.
Rowland Heming © September 2011/ June 2014*
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