The Four Strategic Hurdles Facing the Modern Brand

strategic hurdles

By Grégory Pouy, {grow} Community Member 

If you’re still working on “digital transformation,” you’re already behind. Through my marketing consulting practice, I’ve defined the four strategic hurdles brands face going forward:

  1. How can I redesign my business model in a turbulent economy?
  2. What is my company’s role in society?
  3. Given this new order, how should my organization and management look?
  4. How do I leverage data?

Let’s look at these individually.

1. Redesigning a business model in a turbulent economy

 In my opinion, three observations need to be made of the current business model:

  1. The mass market has become an interconnected, multi-niche market,
  2. In many industries, the barriers of entry have disappeared,
  3. There must be a service-oriented upper level.

For years, the cash cows for large groups were brands positioned as “affordable premium.” These products were targeting big segments of the population like “women aged 18-35.” This positioning is slowly crumbling away.

Aided by search engines, people are focusing on products that perfectly match their individual needs. They put all of their trust in consumer reviews and influencers, revolutionizing the discovery process.

As Mark Schaefer tells us in Marketing Rebellion, the consumers own the customer journey. The consumers are the marketers.

At the same time, barriers of entry to the digital world are falling away: many products are low-tech, people can find the best vendors online, and social media is making communication approachable and effective. It’s no accident that all the growth in consumer-packaged goods last year was captured by digital-native brands.

In my view, there are three paths forward in this era:

  1. Sell products with the same quality at much lower prices
  2. Position yourself in a specific niche with an “affordable premium” price point
  3. Make selection and customer experience a lot simpler and enjoyable

Notice that layers of technology are not part of the answer.

Colossal amounts of money are being wasted to check the tech boxes — virtual reality, chatbots, mobile apps, social media, etc. Instead, we need to look at technology only through the lens of creating customer value. The technology must serve the needs of the consumers.

2. What are the societal and environmental impacts?

A global survey done by Unilever underscores the fact that consumers are now much more involved in and worried about social issues.

For 88% of respondents, ecology was overwhelmingly the most important issue.

Consumers are much more likely to recommend brands that care, share much more of their content, stay much more loyal to them, and create an emotional connection.

If you want to see how big this movement is, just count the number of organic stores, concept coffee shops and grocery stores in your neighborhood right now.

In 2019, 87% of the 53 million metric tons of clothing made in 2018 (in English) are still being incinerated or dumped into landfills. The clothing industry is not the only bad apple. In September 2018, on the French TV program “Cash Investigation,” Elise Lucet also wagged her finger at Coca Cola, portraying it more as a company that peddles plastic than sells drinks.

The signs are clear. We must revolutionize how we see business so we can guide the transition toward ecology.

Consumers are increasingly looking to companies for the answers and those that heed the call and set the moral compass will win.

This takes more than brand storytelling or jumping on a bandwagon. It’s about totally changing brand positioning from top to bottom. This is what sociologist Michael Dandrieux calls “ecosophy.” A company that claims to be enduring is obligated to think about the long-term and the purpose behind every action it takes by actively improving living conditions as well as the conditions of human existence.

3. Organization and management approach

As McKinsey highlights in this article, current managers are often obstacles to progress because they fear change and don’t understand their own role in the new world order.

That is why the link between people and the management culture must be redesigned.

In a human society where people would rather live well than do well for a company, we need to redefine the role of management.

In no way does this mean people are not motivated or effective, it just means they are not driven by the same things anymore. A new career approach might mean:

  • Non-linear career paths
  • New reward incentives
  • Opportunities for re-invention on the job
  • A more progressive view of diversity as a way to improve operational performance
  • A revised look at the role of “brand” and culture in attracting talent
  • A focus on trust and empathy as key managerial skills

… to name a few ideas.

Specifically, we must look at a new emphasis on the role of emotion in a company, and its role in leadership.

Today’s employees are making career choices based on a mix of compassion and reason and they want to seek meaning in their work. That’s why we’re starting to see CHOs (Chief Happiness Officers) in many companies.

There is an important impact on marketing here. The stories our employees tell about our brands become part of the consumer narrative. Happy employees who can talk about the meaning behind the company and its products is good marketing.

We’ve spent years in marketing wanting to make the logo bigger. Now, we need to make the emotion bigger.

4. How do I leverage data?

You may have read somewhere that data is the new gasoline. Clearly, all the capacities like customer knowledge, data-mixing (open or non-open), algorithmic bias prevention, and data ethics compliance are having a big impact on companies.

As McKinsey points out, the data culture is the decision-making culture.

As the unavoidable complement to emotion, data must be leveraged so we can:

  1. Offer products or services that are optimized based on the best criteria for targeting customers,
  2. Optimize marketing campaigns,
  3. Make a whole set of decisions with a better data-driven understanding of the ins and outs of the subject at

Here’s a great example: the startup Prose.

Prose analyzes 150 data points per customer to formulate personalized hair care products. They aggregate data from open data platforms, specifically geographical areas based on ZIP code, and the Prose algorithm retrieves the hardness of the water and local levels of pollution and sun. Then, Prose asks a series of questions and develops one unique product for their customers, most of whom have a combination of issues, so they don’t have to buy several different products.

In this example, the dataset is being used to care for the customer and provide an extraordinary customer experience. Prose also helps customers make a positive environmental impact and builds loyalty by continually improving the product based on customer feedback.

Prose is using data to not just sell a product, it is creating a personalized service.

Conclusion

There is a common thread in these brand strategic hurdles. When the changes in the world are so fast and furious, find your bearings by re-connecting to the humanities as a compass. Or, as Mark Schaefer has written, focus on the constant human truths.

The best brand successes will come from companies who truly connect to human needs, use technology to serve those needs, express solutions in a way that attracts fans and employees, and communicates their compassion in a way that helps the stories spread.

Gregory PouyGrégory Pouy is a globally recognized blogger, speaker, evangelist, consultant and podcaster on Vlan – a show that analyses the evolution of the society in the age of the industrial revolution.

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