Every experienced marketer recognises the problem: they know that brands grow over the long term but all too often their efforts are diverted into delivering the next quarter’s budget.
Grow your brand over the short and long term
Our 2018 study "Getting Media Right" finds that only 52% of global advertisers are confident their organisation has the right balance between short-term performance marketing and long-term brand building.
Despite the apparent dichotomy between short and long term, their definitions are far from clear. It is not as though we can easily segregate short-term activities from long-term. A "short-term" price discount might have a long-term effect if it gets someone to buy for the first time, thus increasing the probability that they will buy again.
Equally an ad campaign designed to build positive brand attitudes over the "long term" might remind an existing user to buy the brand on their next shopping trip.
What we can say with confidence is that sustained, long-term growth is rare. Our BrandZ™ global brand equity database reveals that of the brands measured across both a one-year and three-year time frame, fewer than 6% of brands grew market share over the first year, but only 6 in 10 of those had sustained that gain over three years, and fewer than 1 in 10 further improved on their initial gain.
Our analysis finds that the key to sustainable growth lies in balancing investment across three key marketing activities – experience, exposure and activation - designed to influence behaviour at different points in the buyer lifecycle.
To help all marketers improve their chances of achieving sustainable market share growth, this report offers a simple framework for understanding brand growth, and makes five recommendations on how best to build sales now and into the future.
Our findings are based on the analysis of 3,907 brands in our BrandZ™ database measured over a three-year period across 21 countries and 58 product categories.
Building sales momentumIn science, momentum is a function of mass and velocity. With brands, greater mass (market share) brings huge advantages. But mass on its own does not guarantee future growth.
Growth comes from improving velocity, the speed at which the brand builds sales relative to its size and to its competition.
All marketing activities need to work now, but not all of them drive sales at the same rate or over the same time frame. For instance, our market mix modelling finds that on average, digital display and search marketing tend to have a very quick sales impact but that their influence does not last. TV and digital video have longer lasting effects but still decay over the course of several weeks.
Unless you have the budget to spend continuously, growth will be hard to come by if you rely only on short-term incremental effects.
The key to building sales now and into the future is to turn incremental effects into lasting ones.
Many in business think of “brand” in very limited terms: a logo, advertising, PR and social media posts. But no one buys a brand because of its logo. They buy it because of what that logo stands for. A brand is defined by the intuitive feelings, memories and experiences that people associate with it and some of those defining associations may be decades in the making. Everything you do builds your brand, but it is how people interpret what you do and how they remember it, that really matters.
1. BALANCE YOUR INVESTMENT
At Kantar we identify three broad areas of marketing activity that are key to driving sales now and for the future:
Each one is important, and each contributes to brand growth in a different way and over a different time frame.
Getting the balance of investment right is critical to creating sustained growth. It is very tempting to focus only on one activity. However, our research finds that brands which focus too much on only one activity risk leaving money on the table.
More sales momentum is achieved by ensuring all three activities are optimised and working in synergy; focusing only on one area will likely result in underperformance. Further, your brand’s category, size and competitive context may dictate a different balance of investment across these three areas to maximise sales momentum.
Applying market pressure across three points in the buyer cycle builds sales momentum now and for the future. Strong performance at each stage adds up to an overall increase of 46% across three years.
We start with experience because this is the ultimate test of your brand, the point at which all the promises and expectations meet the reality of what the brand really can deliver to its customers.
2 EXPERIENCE: DELIGHT YOUR EXISTING USERS
If users have positive attitudes toward a brand (are predisposed to buy it again) then they are more likely to stick with it. Across the 3,907 brands measured in BrandZ™ over three years, those which have more users predisposed to buy than expected, grow market share by an average of 7% across the next three years (those with a deficit decline by 9%). While this increase may seem small, it is ten times the average observed across all brands.
Marketing has a big role to play in framing how people experience the brand. It starts with a clearly articulated and understood brand promise that defines what the brand has to offer. New customers will judge their own experience in the light of the expectations created by marketing, so it is important to mind the gap and ensure that the brand experience is aligned with the brand promise.
Companies that deliver what they promise are three times more likely to be recommended by their customers, and twice as likely to have customers with stated loyalty.
To grow, brands must continually acquire more new users than they lose existing ones. An important driver of growth is to seed positive ideas about a brand before people even start thinking about making a purchase.
3 EXPOSURE: REACH OUT TO FUTURE BUYERS
Our research finds that if people are predisposed to buy a brand – in other words, their brand associations incline them to choose it – they will be more likely to buy than if they come to the brand cold.
Brands grow when they reach out beyond the existing bubble of users:
• For a small brand, this might mean targeting people currently buying competitive brand
• For a big brand, it might mean reaching out beyond existing category buyers
Across the 3,907 brands measured in BrandZ™, brands that grow the proportion of predisposed users more than expected reached a cumulative three-year increase of 27%. Brands drive predisposition by increasing positive attitudes related to meaning, difference and salience in a way appropriate to the brand and its category. Typically, this means identifying a difference about the brand that has the potential to be meaningful to a wider audience and then making that difference as salient and meaningful as possible.
Studies by Kantar, Binet and Field, and Nielsen all find that there is a consistent relationship between share of voice this year and market share change next year. The more a brand spends compared to its market share, the more likely it is to grow over time.
Brand exposure, however, is not just the result of investments in marketing and PR. Social validation, seeing other people using the brand or hearing it talked about on social media, will have an influence and a great experience will drive recommendation and word of mouth. This should in turn help to boost positive exposure.
Activation or performance marketing needs to either trigger pre-existing positive feelings toward the brand or make a compelling enough offer in the moment that the person is persuaded to choose a brand that they are otherwise not predisposed to buy.
4 ACTIVATION: CREATE SALIENCE WITH MEANING
It is tempting to see activation as independent of experience and exposure, but it is not. If people are predisposed to buy a brand, they are more likely to follow through on that intention.
Predisposition has the most influence on growth (contributing up to 34%), but when coupled with a high conversion of shoppers who weren’t initially predisposed (generating up to 12% growth), the overall growth is even stronger.
For a brand to capitalise on predisposition, it must be salient: the brand must come readily to mind in relation to a specific need. Building meaningful difference is also particularly important when it comes to justifying a brand’s premium price point. Our analysis finds that on average people pay 14% more for brands they find to be meaningfully different.
The risk of relying on conversion of buyers that are not predisposed is that low price becomes the sales driver, undermining short-term margins and setting up customer expectations that the brand will be sold on deal in future.
We find that strong predisposition shortens the path to purchase, giving less chance that other brands will intercept the customer or that the customer will find a new brand that they never heard of before.
Good growth also requires good guidance, metrics that directly relate to the strategy and guide progress, identify whether a course correction might be necessary and inform the optimisation of implementation and execution.
5 GOOD STRATEGY AND GUIDANCE
Good strategy: know where you are now, where growth will come from and how to achieve it.There are relatively few basic growth strategies:
• Expand into new geographies
• Expand into adjacent product categories
• Acquire new brands
• Grow the existing category (typically of benefit to brands with high market share)
• Or grow value and/or volume market share
Within those base strategies, however, the optimal route to growth will vary dramatically according to brand status, category and competitive context.
All marketing activities will play out over different time frames. People will only buy when they are ready. To grow over both the short and long term, a brand must not only influence current users, searchers and shoppers but reach out to potential users, many of whom may not even recognise a need or desire for the category yet.
Good guidance: anticipate success, know when to course correct and how to optimise.
The problem facing marketers is that much of the data easily available to us today is focused on what happens now. The most easily available behavioural metrics are immediate, volume-based and do not necessarily relate to long-term success. It is not surprising that activities which demonstrate an immediate return tend to win out in the competition for marketing budget.
Without reliable short-term indicators of long-term success, brands risk tactical tail chasing – that did not work, let’s try something else – undermining clarity as potential buyers see the brand presented differently across touchpoints and time.
To combat data short-sightedness, brands must identify the short-term indicators of longer-term success that can inform decisions on how the marketing budget should be allocated between experience, exposure and activation, and then optimise that spend effectively.
In the past, marketers had to wait weeks to figure out what was going on with their brand and competition. No matter how important, attitudinal data took time to collect and analyse. Now all that is changing.
The combination of real-time digital data, advanced modelling and artificial intelligence is transforming the way marketers can monitor and react to change.
However, to make sense of digital data you need to do more than just track the changes in overall volume. Different behaviours relate to different outcomes and, just like sales, many things drive the volume of search or social data at any point in time.
At Kantar we have invested in mapping digital behaviours to specific outcomes related to brand building. By applying advanced modelling techniques, it is possible to strip out noise to identify both the impact of current marketing activities and the underlying long-term trend indicative of future growth.
Digital data on its own will not give today’s marketer all the information they need to maximise growth. Many leading indicators of growth are attitudinal and require us to understand what is going on in people’s minds. Luckily, advances in survey methodology – notably the transition to mobile – and a focus on leading indicators and automation are helping close the gap between real-time and survey-time.
By combining automated analysis with behavioural data and responsive survey metrics directly related to your brand’s goals and summarised in an interactive dashboard, marketers can quickly identify opportunities to course correct and optimise their marketing investments.