INSIGHTGood vs. More.
Brand value is the differentiator in our world of plenty.
Ours is a time in which we can get almost any product or service we want, whenever we want it. In this abundance—and likely because of it—our dominant and emerging spending classes (Millennials and Gen-Z*) are declaring that brand values are essential factors when evaluating affinity and forming loyalty.
Is it that younger generations are being raised with next-gen morality and integrity? Or is the deluge of products and services, all vying for attention with marginally discernible differences and often questionable quality, starting to force brands to adapt and align with their customers more holistically?
In a world of plenty, more is hardly exciting.
Wealth, access, and abundance present an opportunity for self-reflection, especially, though not exclusively, in the contexts of: social justice, climate crisis, political unrest, and the inherent tax of excess on health, well-being, and in our communities.
✅ Lathered up in 20% more than the leading brand. Slightly bouncier curls?
✅ Got two-for-one two hundred and one times. Only needed one.
✅ Told to “just keep it” when processing this Amazon return. Still don’t want it.
✅ Binge-watched White Lotus, Euphoria, Handmaid’s Tale. Sense of ennui intact.
✅ Eating an additional 50,000 French fries for +25¢. Does insurance cover my statin?
✅ Three-hundred pack of athletic socks. Full of holes.
In a time when more is one of the biggest global problems and social media trends are no longer novel, there is a nascent shift toward privatization of the things we do and more careful consideration of the impacts resulting from the products we use.
As a favorite six-year-old of mine often says: Ugh. I’m so booooored.
The Pepsi Challenge
The old economy that persisted for most of the 20th century was composed of fewer companies, fewer products/services to market, and a narrower set of advertising and marketing channels. Consumer groups were less understood by both buyer and seller, and there were fewer ways in which to purchase products. Competition was more narrow and the scrappy were often silenced by the domination of shelf space and the saturation of airtime by giants.
Take The Pepsi Challenge, for instance. The illusion of choice was more a momentary and highly-influenceable preference between two dominant options, assuming that the taster must prefer one over the other, rather than, say, neither. Society wasn’t enabled to experience real choice, nor was it ready for diversity, but it was susceptible to the illusion of the former. Sure, you could skip it, but we didn’t even have 300 different artisanal bottled water options yet.
It’s a miracle we survived.
What Does Good Look Like Now?
Our developing empathy and responses to exigent threats, pared with years of brand promises that haven’t quite delivered, have created an inflection point. It turns out that more hasn’t often served us well. We don’t need more of much, and the want for more is reaching a point of diminishing returns for many.
What we are begging to do instead, as consumers and in some big segments of society, is reexamine and form new relationships with our needs.
Our needs are given value by weighing utility, pleasure, and ethical alignment versus costs, (e.g., financial, social, environmental). We are starting to value, well… value, above abundance.
Understanding and articulating value is how the brands that matter to consumers will survive and grow. The promise and delivery of good is where trust and loyalty are going to be built and maintained, more and more.
Brands have got to rise to meet this complex challenge. Harmonizing the three tidal forces of consumerism in this new paradigm is going to be just as important as engineering and development. Probably more.
Force #1: Throughput
Brands, and the people that drive brands, must have throughput. Throughput is the utilization of a brand’s resources at an economical capacity. The competition and saturation in current markets forces brands to find new ways to balance this. They must form a deeper understanding of their customers in order to identify and fulfill needs and appropriate and sustainable scale, rather than churn to keep up with growth goals.
Force #2: Value
Customers want value; that value goes way beyond our digital wallets. In a world of access and excess, customers want to know how their products are sourced, want decent customer service behind tech, want a look at those DEI and ESG policies.
When the values of a brand are clear beyond the cost, and sometimes even in spite of the financial impact, a brand can reach beyond affinity to achieve loyalty.
Force #3: Profit
Narrow, bottom-line-only thinking is a strong qualifier for degraded value (more on that here) and a clear call for leadership change. Also, TAM/SAM definitions are often works of pure fiction that require, ahem, “pivoting" (read: asking for $10MM more because of “evolving market perceptions” instead of telling the truth that maybe not as many people as was stated in the pitch deck actually want Uber for Cats).
Harmony between these three forces means taking a different look at the needs of the organization, CFO, and shareholders as compared to the actual needs of customers.
Quarterly reports may not have the ping that majority shareholders have gotten used to, but we’re not exactly out of business, either. We’re going to have to teach them about incremental gains and “lifetime customer value.” Doesn’t sound so bad to me.
Herbert Hainer was able to revive Adidas from a $3.4B company to a staggering $30B company by positioning brand value to customers ahead of financial performance, remarking on—and proving out—that if Adidas did well to serve their customers, the money would follow.
How We Get to Tomorrow
As/if/when brands understand the underpinnings of this change, shedding both the convenient laziness of cynicism and the off-gas of voluminous and vapid marketing messages, it might lead them (and us) toward a better tomorrow.
By sacrificing massive gains on the P&L statement, realignment may allow a brand to better achieve customer value, which will in turn increase demand, which will enable greater throughput. Guess what that will do to a realistic bottom line, the planet, and our collective and specific senses of well-being?
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Matthew Thornton
22 February, 2023
* The purchasing habits and worldviews of those 60 years of age and over (boomers, silent and greater generations combined = 30% of the population, guaranteed to not grow in numbers) is, generally, important. But not for this article! And, seeing as Gen-X’ers (present company included), represent a not-ironic 22% of the US population, we don’t want to participate in this article anyway.