The Future's Bright, The Future's Orange… or Vorsprung Durch… or Just Do It!

Published on: 1st April 2019

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Celebrating 100 years of consumer healthcare spotlight header image

Organisations that have been around for 100 years or more are clearly doing something right, bringing relevant and significant value and meaning to individuals and organisations, adapting well to ever-changing circumstances and culture and clearly engaging individuals, at a rational level and potentially emotionally too. Their relevance, meaning and appeal are all captured in the brand, the understanding that rests in the heads and hearts of each of us. Many congratulations to PAGB for reaching that remarkable milestone and happy birthday, with many happy returns.

John Noble

If you remember the slogans in the title, you know first-hand the power of brands. The slogans helped build understanding and appeal for the products they promoted, becoming powerful shorthand distinguishing them from rivals. Orange created a zig moment when everyone else was zagging. It is one of the most successful launches of all time and, for a while, unstoppable.

As long as branded companies can, even occasionally or briefly, hit the ball out of the park by engaging more closely, more deeply, with individuals and while individuals rely on their brands to understand complex markets and inform their choices, then tomorrow will still be branded.

That may be counter-intuitive as the prevailing rhetoric on the future of brands is generally negative. We hear of brands in existential crisis, large brands struggling to compete with small, agile ones, a general decline in brand loyalty, a commoditised world where people choose ever more own-label, and we hear of a digital, e-commerce landscape where platforms, driven by algorithms, are out to make brands obsolete. All this will lead to the death of brands, a prediction that has been made consistently through the decades.

Even in a world of faceless algorithms, the counter-argument runs, we as individuals will rely more than ever on powerful, meaningful and accurate heuristics (aka mental shortcuts) to understand the choices we face and to help us make decisions at speed. An abundance of choice, limited interest, too little time and ever-fuller lives make brand meaning, accessed in milliseconds via heuristics, more crucial than ever. In complex or low-engagement or problem-solution or unfamiliar scenarios (and healthcare usually ticks at least one of these) where individuals seek confidence and information to support their choices, brands have a role.

The digital world seeks, through search, voice, algorithms and the like, to reduce the world to set of transactions, functional queries and responses that ‘funnel’ us towards a product that apparently fits our needs. Brand-focused companies need to disrupt this to stay relevant. We see three key tasks for such companies to win in the future:

  1. Winning hearts and minds
  2. Innovation. Innovation. Innovation
  3. Expertise – own the category.

Hearts and Minds.

Orange or Innocent or Compare the Market or Nike or numerous other products not only persuade our rational self that a transaction will meet a need, but they engage our emotional core and build distinctive, repeatable connections.

Consumers are changing, behaviourally (in how they consume media and information), in their needs (including whether or not they need brand relationships), and in their shopping habits (using omnichannel for search and purchase). Some of these changes present challenges but the task is the same. Branded products need to be front-of-mind and relevant at key points in the consumer journey.

For example, witness the growth in purpose-driven branded products. 53% of UK consumers make decisions based on a brand’s values. Platforms and retailers can have purpose but they will rarely deliver the category-specific relevance that a branded product can. Nike’s work on women and disability in sport are telling examples.

To do this the song remains the same: deliver the Right Message in the Right Place at the Right Time. In healthcare, the potential to engage and support people to deal with ailments or promote wellness is still untapped and brand-focused companies can lead this revolution. This will blend traditional media such as TV with digital innovation with its micro-targeting and influence, a required core competence for today’s marketers.

Innovation. Innovation. Innovation

While the big platforms are cash rich and it is hard to predict where their future investment may go, currently branded products are the only proven vehicle through which packaged goods innovation is created and successfully delivered to individuals.

Strong innovation drives engagement, premiumisation and competitiveness, even if it is ever more rapidly copied! Branded products must build, protect and leverage their unique access to insight to keep ahead. In fact, many of the great, newer, SME branded products are founded on insight learned when their business leaders were working on bigger brands.

If you are not innovating, whether in product, business model, claims, co-creation, digital, services, e-commerce, M&A and/or partnerships, there will be the risk of stagnation. The innovation imperative is nothing new but its importance is increasing. This requires two contradictory approaches:

The evidence bears out that the brand route remains unparalleled in delivering innovation success. Brands are points of trust for trial, generators of understanding, reducers of risk, efficient investment vehicles and facilitators of faster take-up by users. In fact, whilst new brands are successfully disrupting traditional brands, they usually need to replicate the proven models of marketing and distribution developed by legacy brands to scale up.

The elephant in the room? We fully acknowledge the changing nature of distribution and recognise that the challenges of winning in an omnichannel world cannot be under-estimated. There are no quick or easy fixes here, but it starts with building expertise in the new channels and, more importantly, insight on how people specifically use and interact with them in YOUR category, for YOUR product and YOUR brand. The combination of this insight, a relevant solution, an engaging brand and a flow of meaningful innovation will still bring success.

Expertise – own the category

Despite the depth of their pockets, it is hard to conceive how the likes of Amazon could be the experts in specific categories rather than the leading brand-focused companies. This is an area to exploit with consumers, through innovation and more effective engagement.

Healthcare has a unique opportunity to bring valuable services to the product transaction, focusing on building user experiences beyond the products, from subscription services to supporting product compliance and experiential input beyond ‘a few apps’. This has the potential to create in turn valuable data and insight. Data will be key and whilst digital platforms will have enviable behavioural and purchasing data, this is no reason not to seek data-driven insights in other areas. All branded products of tomorrow will need a data strategy.

Where there are influencer channels, whether experts or peer-to-peer, there is an important opportunity to help build and lead them proactively, something that brand owners can do because their brand and expertise gives them a unique permission to be there.

In conclusion, business has always been predicated by new challenges and disruption. Many once fabulous brands have faded through a failure to adapt. But, as long as people need to make choices and those choices are based on quality and relevance, and as long as people look for more in life than just basic functionality, there is an opportunity for branded products to succeed. The model will evolve, but engagement, innovation and expertise will enable the best branded products to stay as category leaders, still driving choice and consumer satisfaction and preference. Without powerful brands, there would be no own-label copies.

 

For more on heuristics, see the Brands Lecture Accountability is not enough.
The British Brands Group champions brands and ensures that, in the UK, there is vigorous but fair competition and a climate that encourages innovation and the building of trust and reputation.

 

By John Noble, Director, British Brands Group, and Tim Brooks, Founder of Muzeable

 

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