Anyone in the marketing industry will tell you that the most important indicator of a brand’s health is its relevance to consumers -- that the brand matters to people in some consequential way. This being the case, the most significant challenge for brands is being able to shift ahead of markets in order to continue to matter. In a world changing faster than ever, this is becoming more and more difficult .
While you don’t need scientific analysis to support this point (there are reports of faltering brands on an almost daily basis in the news), one study empirically underscores it. Using data from Brand Asset Valuator, this study followed the well-being of over 3,500 brands for a period of fifteen years: 1999-2014. My partner, Chip Walker, who worked on the study, said the reason for choosing this time period was the huge amount of data available.
And as Walker put it, “What we learned, in general, was that over time, brands tend to change for the worse. Only 25% of the brands we studied changed in a positive direction.”
The reasons for this negative news?
First of all, trust has taken a nosedive. Consumers can simply see more, and this transparency has a profound impact on trust not only in brands – but all institutions.
The second reason brands lost value over the fifteen years studied was a slow, steady erosion in differentiation. Consumers began to see brands as more and more alike. Consumers have to be able to discern and experience what makes one brand better than another in some appreciable way in order to buy into it.
The third reason the majority of the brands studied lost value? They were no longer seen as leaders. The characteristics for what makes a leadership brand are changing. While once it was OK to be seen as innovative or progressive, this is no longer enough. More and more, brands that are thought of as leaders are perceived as being visionary – giving consumers what they want and need before they know they want or need it.
To go back to a famous Steve Jobs quote, “Henry Ford once said, ‘If I’d asked customers what they wanted, they would have told me a faster horse!’ People don’t know what they want until you show it to them.”
The leading brands today are solving problems that consumers haven’t articulated yet.
So, what can marketing professionals take away from this study and apply to their own endeavors before it’s too late? As I write in my book “Shift Ahead," there are no magic potions for being able to stay relevant.
There are, however, smart actions to take. The first is to ensure that your brand is differentiated from others in its category in some appreciable way. Brands that are succeeding in this effort are not focused on their competitors, but on their customers, getting into their heads and walking in their shoes, looking for some insight that is often hiding in plain sight.
The second is to ensure your organization is primed to both “see and seize.” Given a market that’s moving fast, an organization must be ready to move fast and deliberately when it sees an opportunity. It must assume a dynamic versus static mindset.
Most important, brands in the minority -- those that continue to succeed -- have an attitude that success is never final. Nothing's more relevant to the topic at hand than that insight.