Why a New Brand Era Is Coming, And How to Think About It
During most of my career, I was trained to believe that a strong brand is one of the most precious assets a business could own. But if you worked with marketing in the past decade, you probably felt that brands and branding were not the protagonists of the growth stories that have been shaping our world.
I remember the feeling during my last years working as a brand consultant: agencies were desperately trying to become more "digital" (even though no one really knew what that meant) while marketers and consultants were running blind to learn the new era digital skills. "It's not a one-way relationship anymore, it's a two-way dialogue! Growth hacking is the new thing! Apps are the new thing! SEO is the new thing! Customer experience is the new thing! TV is dead! Dive in Facebook, build for Instagram, dance like a TikTok!"
And brands? "Well… brands are dead".[1]
That is pretty scary stuff.
Brand building investments in the last decade or so indeed gave way to a relentless focus on "disruptive" product technology and growth hacking. If you compare the ranking[2] of the most valuable global brands in 2001 with that of a decade later, you will see a shift from brands built by exceptional marketing to those built by innovative tech products topping the charts.
But before we despair and start preparing for the funeral, let me share a more positive outlook.
As it happens from time to time, similarly to technological cycles, I believe the tectonic plates of marketing-land are moving once again. Here is my prediction:
In the next decade, we will see a comeback. A surge in companies heavily investing in creating, developing, and nurturing strong brands as one of the most important - if not the most important - strategic priority to grow businesses. There will be more time, talent and capital dedicated to improving brand equity[3].
But in the same way the European cultural revolution of the 15th and 16th centuries wasn’t the same thing as what happened in ancient Rome and Greece, the way brand is thought, managed, and executed in the next decade will be different to the Mad Man era and most recent Aaker era of brand consultancies.
Why will brand building be back in vogue?
There are many variables in play here, making any prediction just a piece of informed opinion[4], so this is my best attempt to put some structure and facts behind what so far has been a gut feeling. Right, lets dive into it.
The age of disruption is giving space to an era of consolidation. If there is one thing I have learned working for almost 10 years as a brand strategy consultant is that the more competitive a market becomes, the more critical it is to have a strong brand. Every time we had to pitch for big oil companies or massive B2B providers, that was either to satisfy a brand image issue with governments or to focus on attracting and retaining talent. But what we are seeing now in industries that had a disruption champion (i.e., Google and Facebook in advertisement, Tesla in the auto industry and Netflix in media) is that maturity, consolidation, and increased competition are coming. Take for example the streaming wars[5], the number of new electric car players competing with Tesla[6], or the record-breaking spend by big tech companies in "traditional” advertising[7]. With less quantic leaps in product innovation and more players entering the market, brand equity will play an increasingly strategic role as the key engine for organic growth.
Growth hacking hit a hype ceiling & the digital arena is becoming a bloodbath. There is no discussion that we have witnessed a revolution in the democratisation of marketing tools to smaller businesses. Suddenly, every neighbourhood store could access enormous audiences with laser-sharp targeting precision (via Facebook and Google self-service ad tools), buy space in the shelf of a mass retailer (via Amazon) and create their own online shop (with Shopify). But those tools also sharply increased competition: if you do not have a Steve Jobs-like product idea or deep pockets, chances are you will get lost among thousands of other smaller players or devoured by the bigger ones. Despite all the new possibilities for quick, measurable, and targeted sales conversion brought by performance marketing, many businesses, small[8] and big[9], realised that those are not enough for sustainable profitable growth (especially after Apple’s iOS14 break of digital tracking). All of that opens space for the more fundamental (and I would argue more difficult) question of how to build a strong brand.
We are not scared of new digital platforms anymore. Even though we will still see new media platforms popping up here and there (as the explosive success of TikTok in a Facebook dominated arena indicates), the mindset and skills needed to advertise in those channels are now much better understood. There are many more expert in-house teams and specialised agencies operating those platforms, and training is widely available. Also, marketers now have more clarity that those channels are not the strategy itself, but tactical tools to be considered with others in the toolbox. In that sense, bigger brands are becoming smarter in integrating newer digital channels with bigger, more traditional ones. Take for example how Disney+ is brilliantly launching new series: teasing content on Twitter and TikTok to reach influencers and spread word of mouth, showing up first on a Google search on related terms, amplifying on YouTube, and then reaching incremental audiences with OOH in the tube and buses[10]. Even the hypest new frontier of marketing land - the metaverse - has been explored primarily by big brands, with initiatives that are essentially about brand building: creating visibility and desire[11].
Old and new findings in marketing science are becoming more popular. The popularisation of evidence-based marketing science (spearheaded by the folks at the Ehrenberg-Bass Institute) together with significant advances in behavioural science and marketing effectiveness will keep boosting marketers confidence to design better strategies, earn more respect from the C-Suit and attract more funding for brand activities. The evidence is clear: brand building (i.e., quality of the creative, mass reach advertising, building distinctive assets, etc) is fundamental for sustainable brand growth. Those theories are already embraced by strategists and CMOs of the best brands in the world and will continue to be so for the simple reason that it delivers on one of the most appreciated qualities in the business world: confidence to make decisions.
But why brand management will not be the same?
In the same way the European Renascence was inspired by ancient the culture of Rome and Greece, but ultimately unique for its time, the Brand Renascence will not be the same as the Mad Man era of the 50s -70s or the Aaker and brand consultancy years of the 90s and early 2000s. Here is why:
The media landscape will become increasingly more complex. In the years to come, just putting together a TV and a magazine ad probably will not be enough to grow a brand anymore. The number of media platforms consumed by people has increased dramatically, from search to social media, streaming channels, gaming, e-commerce, influencers, blogs, and all on top of all the existing ‘traditional media’[12], that still have considerable reach. This increases complexity and will demand a wider range of specialism and creative skills adapted to various formats, as well as a higher number of partners and martech tools to manage campaign planning and execution.
The P for Product will grow bigger. Product quality has always been at the centre of what makes great brands. Just ask people why they like the brands they like, and you will hear mostly about the experiences they have with a product or a service (I bet few will talk about a brand's advertising). Even the brand guru Professor David Aaker had Perceived [product] Quality included in his brand equity model[13]. The difference is that consumers now buy in the context of what Stanford University Professors Itamar Simonson and Emanuel Rosen call Absolute Value[14]: by using tools such as online reviews and social media references from family and friends, people can access the true quality of a product much more easily. Even though brands still can frame perception, I do think that true product superiority will become even more important, as those qualities will likely (1) travel faster via digital word of mouth and (2) win the conversion game via online reviews when consumers need an extra reassurance to make a final purchase decision.
Access to and richness of consumer understanding will keep getting better (for those that know what to look for). You all know this: there has never been a time with more real time easy access to consumer data (I still think it is a little miracle that Google Trends is totally free). On the positive side, it will keep us better informed to make decisions (when previously we needed to rely either on expensive research or just gut feeling), better placed to identify audience needs and allow for faster learning and iteration[15]. On the other hand, it may get us lost in pointless data or addicted to ineffective loops of consumer feedback. Mastering how to treat data and uncover insights in a sea of possibilities will become a true differentiator.
Physical stores and offline media will become fewer but more premium. Ecommerce will keep gaining ground (even though not at the scale that some of us thought during the pandemic[16]), as well as the need for marketing managers to understand and manage those channels. At the same time, for many businesses the physical store will become some sort of a temple for the brand (think the Apple stores), a place to sell products but also to create experiences that, in my view, are more powerful than any other tool in a marketer's toolbox.
Entrepreneurs already start with brand in mind and big businesses will keep internalising brand building skills. What was before a craft restricted only to the best companies in the world and specialised consultancies, branding and brand management will become more and more of an internal core capability. Already today, start-ups consider brand from day 1, starting with the founder. Consider for example the new-wave set digital-first brands such as Allbirds or Monzo: they all have prioritised brand building activities such as UX, identity design, storytelling and a compelling brand vision. And on the stablished businesses side of things, many talents that worked for agencies or consultancies shifted client side (hello!), bringing brand management skills in-house.
There are other forces such as the expansion of access of creative asset development that will be brought by AI imagine generators, but the above covers the main reasons.
The red thread across all those trends is that things will become more complex, but marketers will be empowered to do more.
What all this mean for marketing in the next decade?
Complexity brings uncertainty and anxiety, but there are things we can do to prepare and take advantage of it. Here is what I believe we should consider to be prepared for a new era of branding building:
Learn the fundamentals. Marketing is only getting more complex, not less. No matter which areas of marketing you work at, the only thing that can give you the necessary clarity to make good decisions is understanding its scientific. Those will empower you with confidence and freedom to think about what matters: how to adapt those principles to your industry and business, and where to focus your creative energy (creativity always needs a frame, a starting point).
Look for the hero brands of the next decade. A decent way to learn about the future is to stay close to those that are living there. Some will continue to do a fantastic job as that is how they are set up to operate (Nike, McDonalds, Disney), but there will be new brand masters in the future. Tech giants are now hungry for brand equity, hiring the most talented marketing people in the industry (as they have the cash for that), and leveraging the best of the timeless branding fundamentals combined with what is needed to win in the more complex marketplace of the future. If you want to learn, stay close to folks such as Meta, Netflix, TikTok and Amazon (despite your current view of them), or to whoever is hiring the right people and doing leading the way in brand activation (you may know better than I do).
Embrace the creative craft of different platforms. You need internal talent and partners that master how to create and market in an expanded and more fragmented media landscape. Find people that are close to your audience's culture, that can create with specialism for very different channels (from creating 10 second videos for TikTok to briefing several digital influencers to designing a beautiful mobile app), and that are able to integrate everything back to your brand. If not, become that person yourself! Finally, test with AI Imagine generators: they may improve the quality of the creative process.
There are other things I believe will come back in importance (e.g. better ways of working between product and marketing teams, creating and nurturing an internal brand culture and orchestrating a brand ecosystem for an omnichannel world), but I will keep the list to those three ideas.
In closing
For those like me that believe in the power of strong brands and made marketing their career of choice, I think we are up to exciting times ahead. Consider the number of wonderful talents brought by the European Renascence, and the quality of the art and science they produced!
Even if you work in sales (or its more recent version, "performance marketing"), I also think that a more productive era is coming to you. With a better understanding of the balance between performance and brand, both areas should be held accountable to more accurate expectations and do a better job in general.
Brands have been sentenced to death before, by people inside and outside of marketing. This created a lot of anxiety and confusion for anyone working in the industry and led to a series of decisions that probably made the job less effective and respected17. For the reasons I have mentioned, I am confident that this is now changing. It will not be the same as the Mad Man era, but brand building will be on the centre stage again. For those passionate about consumers, strategy, creativity, science, and magic... exciting times are coming.
--
Notes and references
[1] This was shared by one of my all-times marketing heroes, Professor Scott Galloway. I was soul crushed, but I also appreciate the fact that even your idols will say some crap if you listen to them for long enough (since 2012 in my case).
[2] There are several problems with brand value rankings (trust me, I’ve worked on them), but take this as indicative performance of total enterprise value combined with brand equity performance.
[3] I refer to brand equity, brand building and brand initiatives many times in this article. Consider that mental availability if you are Byron Sharp follower, or any other brand equity model from academics (Aaker) or consultancies such as Kantar. I like to think of brand equity as the sum of memories and perceptions customers have of a company or product. See more on this nerdy (but very interesting) debate on definitions in this article from brilliant consultant Claire Strickett (What does ‘brand’ mean) or in this article from my genius colleagues Johannes Christensen and Calin Hertioga (What is a brand?).
[4] Aren't all predictions just (more or less informed) opinions?
[5[ The Economist: Disney, Netflix, Apple: is anyone winning the streaming wars?
[6] CNN Business: The great electric car race is just beginning
[8] Anecdotally, I’ve been hearing from colleagues in the industry about many start-ups opening new marketing positions asking for branding experience as opposed to only performance marketing specialists.
[9] Marketing Week: Adidas: We over-invested in digital advertising, and Airbnb CFO: We were right to shift spend from performance to brand-building.
[10] Here is a fantastic thread from a Disney Digital Marketing VP on the digital strategy behind the Ms Marvel series.
[11] The Drum: 5 brands winning in the metaverse
[12] I don’t like term ‘traditional media’ as it creates an unhelpful distinction with ‘digital media’ (what isn’t digital nowadays??) and may led people to not consider all media and channels available when building a marketing strategy.
[13] Managing Brand Equity: Capitalizing on the Value of a Brand Name, by David A. Aaker, 1991
[14] Absolute Value: What Really Influences Customers in the Age of (Nearly) Perfect Information, by Itamar Simonson and Emanuel Rosen, 2014
[15] Disney is once again a great example here in the way they have been prioritising movie launches on Disney+ rather than cinemas to gain better consumer insights. Here from Mark Ritson: Disney is playing a bigger game in its box office battle with Scarlett Johansoon
[16] The Wall Street journal: The Pandemic Was Supposed to Push All Shopping Online. It didn’t.
Comentarios