Change Or Die

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CHANGE OR DIE The problem facing Brand owners is a Changed (New) Context. The opportunity is Change (New) Context. What do you need to do to be a recession breakaway brand marketer and maintain upward momentum? Plan and position your brand to be around for the recovery. To stand still on marketing strategy whole in a downward trajectory results in decline and a long hard crawl back, if ever. Be a breakaway brand marketer. Our analysis, which includes expert Global, Euro and local market studies, concludes that the new context is indeed the new normal for a while, some even claim 2020. In short the mind-set of today’s mass consumer is fearful and they are anxious about job cuts, debt management and life-stage shifts. The 50+ cohort will be working for longer and 18-24 year olds will be lifestyle curbing. The Gini index (inequality between income groups) suggests that the mobility of Wealth to the next generation will be curbed and that the new reference of many of the traditional

aspirational cohorts is down not up. Debt is a now a better measure of spend, not income. However, the mass market has new needs that brands need to tap into and new profitable segments are emerging for brands to innovate across all dimensions of marketing. P&G global strategy is a good example of this. In many developed markets, many marketers are abandoning the Squeezed middle and turning to 50+ as well as Millennial. A good maxim is that a marketer’s brand role is to be the custodian of the brand and to leave it in better health that you found it. What you must not do is what you always do and expect that it will work. That is called ‘delusion’.

“The mass market has new needs that brands need to tap into”

There are new consumer choice drivers & priorities: There are new expectations from brands as consumers are becoming more considered purchasers. Greater consideration means that they are selecting brands through a closer evaluation - only if they would need or miss them. Brands are quickly being down traded for lower cost options, often by retailer or


other ‘brands’. Pew Research Centre (2012) highlights how 71% of US consumers claimed to have made changes to how they buy brands with many moving to buy less on brand and replacing through promotional items or store brands because they believe the quality was ‘just’ as good. The number of people believing that a brand does not mean better quality has increased to 64% which means that the brands in some categories have lost their brand power.

“74% of consumers’ avail of BOGOF’s when shopping”

In the UK, as in Ireland, the volume sold on promotional prices and on smaller unit buys is on the increase as consumers want to buy lower priced units. Although they buy more when on deal; 74% of consumers avail of BOGOF’s when shopping; 67% avail of ‘extra free deals’ while 56% take advantage of ‘3 for 2 deals’ (Source: justaskMCCP 2012)

Consumers’ needs from brands are evolving from ‘symbols of meaning’ to ‘pathways of experiences’ A recent global study from Landor (2012) confirms this trend towards experiences. What consumers want from brands is that they be trusted entities that make life easier through connections, convenience and confidence so they can carry on with enjoying the day to day. For example, Skype gives a human face to a social need and experience and Amazon makes it easy to navigate choice. This has massive implications for how marketers think and plan to win. It is a time to surround yourself with the best talent.

The solution: Strategies that work MCCP has worked with over 80 Irish and UK clients since the recession started and helped them ‘game change’. There are a few common themes around what we do to successfully help clients and their agencies transform their business.

1. Clear out what

does not work

anymore; change

how you spend your

budget and who you

work with

What is central to this strategic shift is for marketers to adopt a different mind-set. They need to be hungry to make the difference in their business and change how they understand their brands relationship with the consumer. They need to be up for change. Now is the time when the rules for brands and marketers are being rewritten. Now is the opportunity to get rid of what doesn’t work and start working in new ways. Be faster, more nimble and more focussed in what you spend your money on and how you work.

2. Base line option:

Follow through an

aggressive and higher

focused play on the

market

You can either compete to grow your share of the pie or simply change the pie. Increasing your share of pie is a traditional yet essential marketing practise, This entails, investing to stay top


of mind (share of voice, media/channel spend), strong propositions and creative that really punches above its weight. Aggressively competing against your weakest rivals and staying in the game can increase share by only a few percentage points. Significant growth requires a sharp focus on; i) newly identified

market segments, ii) refined and

rebalanced positioning,

iii) innovative product and channel propositions and,

iv) fresh communication strategies that focus on new consumer journeys

These are all key to unlocking the game changing potential of brands.

Stepping back means challenging the old ways. This requires smarter research techniques, better collaboration between your agencies and interventions that challenge old thinking and that bring consumer led planning and strategy that is real, sharp and insightful to the table.

3. Craft strategies

that meet the needs

of consumer

segments needs

instead of just

thinking about your

competitors

It is not the case that the spending power of all of your consumers is in decline.

“72% of consumers are in agreement with the statement that ‘luxury is taking time out to relax’”

You must segment to understand how different consumers have been affected by the recession and uncover their new priorities. This is important to find new zones of innovation. Position, innovate and fine tune product portfolios to new needs and seek to create value in niche yet profitable segments.

Rise of Smart Convenience: 44% of consumers have bought a smartphone in the past 12 months while 32% have upgraded their broadband provider (Source: justaskMCCP).

Increase in Home Utopia Trend spend: 54% of consumers have held a house party in the past 12 months (Source: justaskMCCP).


Micro luxury: 72% of consumers are in agreement with the statement that ‘luxury is taking time out to relax’ while 70% agree with the statement ‘luxury is little treats & rewards’. (MCCP Trendstream™)

Healthier options: 43% of women ‘avoid fats’ & 46% eat diet/low calorie products (Source: Mintel 2011), while Bord Bia research (2011) uncovers the fact that usage of deep fat fryer decreased 16% since 2003; while Steamer has increase 11% & Wok 7% over the same period.

4. The Bigger play:

Game change

through higher levels

of strategically

applied creativity and

innovation

Game change by changing the pie is innovating to create new value for both the brand and for the consumer; this is a necessary new frontier. Innovation is the new creativity – offer something new or different so as to attract a new segment or position your brand in an

entirely new and relevant way. Big ideas are harder to leverage and resource in a low to zero growth market so micro innovation that is continuous or (what we call lean innovative thinking) works best. Small changes to the product or service can offer simplicity, relevance and create disproportionately higher value for the user and the product owner while also being delivered at affordable prices. This can make the difference. Examples include the packaging, the format, the channel, functionality and innovative marketing plans. At MCCP, we have set up an Innovation Planning Lab to help clients to game change on these dimensions so as to drive success.

5. ‘Always on and

better planning’

Planning should be an on-going concept, not a ‘think and pause’ one. At MCCP, whilst we believe long range vision planning is necessary to set down a visionary North Star - this needs to be coupled with more regular micro planning so as to constantly adapt while shifting towards consumer’s needs so that allow us to refine and amend.

In summary, this is the time for transformational thinking and for marketers to really up their game. Find the best team(s); identify segment/consumer needs that you can find single minded unrivalled focus; leverage best process in strategic, creative (to include innovation) thinking and skills; commit to a continuous planning and focus cycle. This will enable you to game change your way as a breakaway brand to find a new growth frontier. Kay McCarthy is MD & Founder of MCCP The Planning Agency who work with some of Ireland’s largest brands to help game change through better consumer insights and sharper strategy (brand, communications and innovation).

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Change Or Die