Credit by Charlotte Rogers
Brands can drive growth momentum by being ‘meaningfully different’, but very few should expect to grow market share immediately, according to new research from Kantar.
Brands with the ability to stand out can achieve sustainable growth, reduce their reliance on short-term tactics and command a higher price point, according to new data.
Kantar’s analysis of attitudinal and behavioural data reveals that on average consumers are willing to pay 14% more for brands they perceive to be “meaningfully different”.
But growth will not happen overnight, with very few brands able to significantly increase their market share in just one year.
The wider three-year study of 3,907 brands from the BrandZ database, spanning 21 countries and 58 categories, finds that for organisations with high brand clarity, the brand itself contributes 17% to sales. This figure drops down to 12% for a business with medium brand clarity and 10% for those with low brand clarity.
Brand has never been more important at a time when consumers have so much choice and are looking for companies that match their values, argues Chad West, head of global marketing and communications at digital bank Revolut.
“I always say to my team, the millennial audience, who are going to become the majority consumer market, are looking for a greater deal of affinity with the brands they interact with,” West explains.
“You only need to look at brands like Spotify or Adidas. They’re no longer just selling a product, they’re running huge campaigns on social action and social change. They’re trying to be as relevant as possible to their entire customer demographic. Everything they’re trying to do is with meaning and cause, and that’s on top of having a great product or service.”
Brand differentiation becomes even more important in an age where it’s easy to compete on price, agrees Kate Cox, global CMO at B2B call and chat answering service Moneypenny. In fact, brand clarity is even more critical due to the fragmentation of marketing channels.
“If you’re active in paid social, content marketing, advertising and search you need to have a really clear message and sense of brand, like the writing in a stick of rock, that goes through the entire company,” Cox states.
Maintaining growth momentum is a key area of focus for brands. The Kantar analysis finds that less than 6% of brands grew their market share over the first year of the study. While six in 10 sustained this growth over the three-year period, just one in 10 improved on their initial gains.
1. Momentum mindset
Lessons could, in fact, be learnt from China. In November Evans embarked on a “discovery tour” of China, meeting with major domestic insurers Zhong An and Ping An, as well as tech giant Tencent. What he found was a “tremendous ability” to mobilise quickly to create brands and businesses, while at the same time implement long-term thinking based on a multi-generational approach.
Having a business model focused on continuous innovation and diversification means that regardless of the age of the business, real momentum is possible.
West cites the example of Amazon, which has transitioned from online marketplace to grocery retailer and TV giant, with its eyes now reportedly set on the banking sector.
Revolut takes inspiration from the likes of Amazon and Uber, and their ability to bring disruption to new sectors. Now entering its fourth year, the digital bank is experiencing rapid growth based on organic traffic. When West joined the bank had 50,000 users, which leapt to 5.5 million in the space of two and a half years. Revolut has gone from opening 600 accounts a day to 12,000, the equivalent of 4 million accounts a year.