Like most things, our attitudes towards brands have changed in recent years.
To illustrate this idea, let’s consider the US dollar. Once the symbol of brand equity and the physical embodiment of the fundamental idea of money itself, it is recognizable to almost every human being on earth. Today, even its trust has been eroded and we see evidence of this in the meteoritic rise of Bitcoin's value. According to Coinmarketcap.com, the rise of Bitcoin’s value has been inversely proportional to the US Congress's approval rating.
With the rise of concepts like Fake News, there is a deep well of distrust in almost every institution. Brands have not been exempt from this feeling and are experiencing greater scrutiny than ever before. Whereas once upon a time, well-known brands like Coke or Pepsi once inspired a sense of faith and stability in consumers, today, that feeling has turned 180 degrees. Modern consumers no longer have that inherent trust in the names they grew up with. Now, they are more likely to associate negatively with these brands as they conjure up images of corporate greed, unsustainability, the 1%, and other trigger words.
For a simple idea of what I am referring to, examine private label brands vs premium brand performance during recession and recovery periods. Usually, during a recession, people revert to private label brands in order to save money through harder times. However, once the economy enters a recovery, this trend reverses as people start making more money and return to those trusted premium brands.
This year saw a noticeable break in that trend. According to the Cadent Consulting Group, private label brands accounted for an estimated 17.7% of CPG Sales, more than premium brands. This is despite America achieving some of the lowest unemployment rates it has in recent decades. This points to something every marketer is fast realizing; it's no longer just about money, it's about trust.
You will see the effects of this millennial mentality across the consumer market. Classic beers first started losing their market shares to craft beers and now, micro-breweries. People want organic, GMO-free, animal-test free, free-range products and all of these are in the opposite direction of the way brands have traditionally conducted their business. And the trend is only spreading.
Consumers want new. Or at least the perception of new. Established brands, by their basic nature, are in conflict with this and are suffering. Modern consumers naturally associate these older brands with the old way of doing things. Not only the amoral business practices that led to the real-time destruction of the environment, but inefficiency and maybe worst yet, a fundamental lack of imagination.
So what are named brands to do in an age when their biggest asset, name recognition, is quickly becoming their biggest shortcoming?
Act like a new company
And I don’t just mean relaunching a stale product or tweaking your logo. I mean embrace the attitude and persona of a new company. There have been plenty of brands this year which have managed to see increases in their revenue, despite their association to the proverbial old guard.
Dominos reported a 21% increase in group sales in Q3 of this year because of their focus on making it easier to order their pizza’s via their app. By injecting an element of newness into their existing marketing strategy, they have consistently outperformed the S&P 500 all year. Adidas has chosen to steer into the more positive aspects of brand recognition; nostalgia. They have relaunched a lot of their older designs which still strike a chord with consumers, but have repackaged them to give off a fresh, younger feel.
Even though these brands are far from new, they have associated themselves with the next best thing; Innovation. Today's consumer automatically links new with innovation and innovation with new and both propel customers to buy products more effectively than simple brand recognition.
And it’s not just what you sell, but how you sell it.
The other facet this mentality filters into is how brands choose to advertise to consumers. A lot has been written about ‘banner blindness’ and it's true, this generation of consumers is probably the hardest to successfully advertise to. But it’s not just what is in your advert, but medium it is viewed through.
There are mediums advertising which automatically conjure up feelings of distrust. If you advertise on television and interrupt your consumers' favorite show in order to show them a boring, minute-long advert, you’re already on the wrong track. All it tells potential customers is that you have a whole bunch of money and very little imagination, neither of which will inspire customers to buy your product.
Almost equally as bad are sales telephone calls and post. Both are viewed as archaic ways of communication by modern consumers and this sentiment will be reflected on whatever good is being sold through them. Most people under the age of 35 don’t even have landlines and even when they do, they rarely answer it when it rings. Unless I want to berate the caller for having the audacity to call my house phone when I have a perfectly good mobile phone sitting right there. And I can’t even remember the last time I opened a piece of mail.
On the flip side, there are platforms which are still trusted by consumers. Everyones' mobile phone is still their best friend and according to BI intelligence, messenger apps have overtaken social media in number of monthly active users. This means apps like WhatsApp, Facebook Messenger, and simple SMS are, for now at least, still effective mediums of advertising. We open and react to every message we get and according to L2 Inc, 23% of SMS alerts incur a positive response.
Another up-and-comer which brands need to start exploiting immediately is voice. With the smarthome fast becoming the norm, we still make the majority of our consumer choices from our couch. Research has shown that if your brand is the first mentioned after a voice inquiry, that tends to be the one you go with.
Either way, it is imperative that brands actively start rebranding in cleverer ways and embrace innovation in any way they can. Brand recognition isn’t a complete negative yet, but it can’t be the only laurel a company rests on anymore. Each brand needs to look at their newer competitors and think of what practices they can incorporate in order to build themselves a newer, shiner persona.