RE-DEFINING ‘PURPOSE’ IN THE AGE OF SKEPTICISM
Millennials want brands to stand for a larger purpose: study after study confirms this. As a result, brands have been falling over themselves marketing around “purpose” for what seems like ages (the first big cause-based marketing brands like TOMS and Warby Parker are now more than a decade old!). Now sustainability is rising as a key purpose, with more companies trying to do better by the environment, and consumers looking for wars to ease their “climate anxiety”.
But the data is also clear on something else: Millennials are highly skeptical of brands. While the occasional campaign seems to connect, they’re more likely to view any talk of “purpose” or “sustainability” as one of two things:
- a marketing ploy: they appreciate your effort, but they know what you are doing, and it won’t truly deepen their relationship to your brand
- a potential downside: some consumers actually avoid cause-based brands, assuming a product downside (more expensive, or compromised quality). A recent investigation conducted by the Guardian revealed that many companies, from organic wines to automobile manufacturers, are actually hiding their sustainable practices for fear of turning off their consumers.
So what’s a brand to do? We see four key approaches:
1) Purpose as Benefit: In the old days, it was enough to make purpose an added bonus an added bonus (the main benefit of TOMs was a comfortable, easy shoe: their donation program was a feel-good extra). But today, every brand seems to have a bonus, and they get lost in the noise. Far more powerful is when brands directly translate their purpose to a consumer benefit. For example, Marine Layer is a fast-growing clothing brand that makes the softest t-shirts out of recycled beechwood. The purpose (sustainability” isn’t a bonus; it’s the reason for the benefit (softness).
2) Purpose as Profit: If your purpose helps your bottom line, come right out and say it. Maybe your new sustainable packaging costs less to transport, or higher energy standards have increased your efficiency. Millennials will find your purpose more credible and will be less concerned that purpose comes with a higher price tag.
3) Collective Purpose: Implying your brand will singlehandedly make the world a better place is a surefire skepticism trigger. But if you team up with other brands to tackle a big problem, your purpose becomes more credible and meaningful. For example, several brands (including Travelocity and Booking.com) have joined forces under the Travelyst initiative, which aims to provide sustainable travel solutions.
4) Representative Purpose: If you don’t know how to bring your purpose to life, ask your consumers. Send them a survey on which charity to support, or crowd-source ideas for sustainable innovations (like Nike’s Circular Innovation Challenge). Millennials will feel more connected to your purpose if it represents their views.
Now tell us which approach(es) you think your brand could leverage to ensure a credible and authentic purpose.
WHAT BIG BRANDS CAN LEARN FROM DTC DISRUPTORS - AND VICE VERSA
Our clients keep asking us about the rise of DTC (Direct to Consumer) brands: have they changed the rules of the brand-building game? The answer is yes. And also no.
"Yes" because the DTC model is changing the relationship people have with brands, and big brands need to adapt to keep up (like, yesterday). And "no" because many traditional elements of brand-building still apply, and DTC brands need to remember these to keep their white-hot flames from burning out.
DTC LESSONS FOR BIG BRANDS:
1. A redefined value proposition is a must, and we’re not just talking price.
By eliminating the middle-man and streamlining focus, DTC has convinced consumers they have a better product at a lower price. We're way beyond Warby Parker and Casper now; virtually every category has an option promising more benefits (premium quality, better design, more sustainable) at a decent price. And consumers believe these brands, partly because they feel so fresh. But as competitive price (or perception thereof) has become table stakes and only part of the value equation, successful brands bake more into the product offering that ups perceived value. They make things easier (like hybrid’s Quip’s toothbrush sold in Target with a no-brainer brush head online subscription that automatically replenishes) or easier to customize like Prose who formulates and packages their hair care systems based on individual on-line assessment.
Question: What is your brand’s redefined value proposition that can sustain differentiation vs. DTC offering beyond price?
2. Disruption for progress has lasting value; disruption for attention is fleeting.
Cleary being first to market, and doing a good job at it, has huge advantage. But not everyone can be first. We think that identifying an emerging paradigm shift that is about to impact consumers’ lives and your category, and then positioning your offering around the need created by that impact, leads to more enduring success. Consumers gravitate towards brands that ‘illuminate’ in some way—help them discover, navigate a complex world, embody progress, make them feel smart, confident and inspired. DTC brands have had success achieving this by borrowing business models from adjacent categories and creating brands that solve problems or deliver benefits against emerging needs. For instance, Blue Apron has adopted the all too familiar Ikea at-home assembly model, to offer unprecedented control and convenience in the kitchen in response to the growing distrust in the food industry and quest for waste reduction.
Question: How can you reframe your brand or category to create meaningful disruption?
3. Don't convince; engage.
Sure, DTC brands have an entire website to create consumer connection, and don’t need to be bothered with claims that will stand out on shelf. Still, there is good learning abut how they connect on their sites. The successful DTC brands engage their consumer online by offering an immersive experience that is visceral and intuitive vs. reasoned and persuasive. It doesn’t feel like you’re being “sold.” Instead, they employ a cohesive, highly visual look & feel with copy that hits on key beliefs vs. logical demonstrations of a proposition, backed by concise, credible claims. They invite you to explore an entire world, where you will be educated (Care/Of has scientific papers on their site), entertained (Primary's emails are adorable and witty) and embraced by a community (Glossier's Into the Gloss is a hangout for makeup lovers)
Question: Is your brand "talking at" your consumer or inviting them into a more thoughtful, immersive world?
4. Even innovation processes can be innovated.
DTC brands have the luxury to experiment and act quickly at a fraction of the cost of traditional brands, who must endure rounds of internal R&D-led innovation supported by BASES. But time is of the essence now, and frankly there are better alternatives. Native Deodorant tweaked their formula 24 times after it was already on the market, based on consumer feedback — so brands need to think about ways they can mimic that process in a way that works in their system
Question: How can you embrace rapid prototyping and consumer co-creations to innovate faster and stay ahead? And how can you objectively evaluate forward-looking ideas around a need consumers don’t know they have?
BIG BRAND LESSONS FOR DTC:
1. Data doesn’t give you a full picture of your consumer.
The rise of data analytics in the DTC model provides unprecedented knowledge of what consumers are doing. But it rarely gives you a rich view of why. It assumes predictive behaviors, when in reality consumer behavior is highly emotional and even irrational. Often, what is labeled as “insights” are really behavioral observations that can be misread without the right context. Big brands have the resources to get at these emotions using face-to-face interaction and qualitative assessment, but the DTC model risks over-relying on data.
Question: How can your DTC brand ensure a rich understanding of your consumer's ever-changing moods, beyond what can be captured by data?
2. You won't be disruptive forever.
Big brands have pipelines and strategies that allow them to prepare for the future, and the DTC landscape is also filled with unknowns that must be anticipated. If your DTC brand provides occasional purchases touting durability, like Caspar, Away or even Swell — you need to find ways to credibly expand to keep consumers buying into your lifestyle after they've bought your product.
Question: As DTC becomes infiltrated by low-quality wannabes and huge corporations (e.g. Walmart buying Away) — how can you ensure the bond of trust you enjoy with consumers isn't broken?
DOES GENDER STILL MATTER IN MARKETING
Rarely have societies been transformed as deeply as western societies have over the past ten years. With the advent of new platforms of exchange of ideas as well as the emergence of a more educated middle class, it is now commonplace to openly assert one’s gender, age, religion, sexual preference or ethnicity. So in a day and age when anyone can claim a gender and gender roles are being re-defined, does it still matter to think in terms of gender-based marketing?As we are evolving from gender exclusivity (specific roles exclusively allocated by gender) towards gender equality (equal roles across genders), the concept of gender marketing needs to evolve as well.
Long gone are the days when women were viewed as mere housewives who couldn't express a personal point of view, let alone lead a career. Women can exert power on their own terms and are less and less defined in relation to men, or asked to fit within a male model. Now men are evolving too - from the stoic, macho provider to the enlightened, sensitive, intuitive man. Goodbye John Wayne (or Bruce Willis). Hello Eddie Redmayne or even George Clooney, previously a sort of a bridge between the two worlds, and who has vaulted into 'enlightened man' territory with his new role as supportive "arm candy" to his wife, a woman of formidable power. The image of the aspirational man is being transformed
So why should brands continue to target women as the shopper of household products when increasingly, men are equally likely to go and pick up those items at Wal-Mart? As gender evolves from specificity to equality, the gender equation needs to evolve from pre-determined gender-based needs towards a more complex combination of: a) shared NEEDS (the basis for gender equality + b) specific gender-based VALUES and WANTS
As the progression towards gender equality is redefining the attributes ascribed to men, many men are looking for ways to reconcile old and new values
While Millennials are primary drivers of gender equality, Boomer and Gen X men seem intrigued but unsure how to make the transition. And many are not fully convinced—is this really what women want?, we hear them wonder. Is it who I am? Will I be respected at work?
These are good questions. Women do want an enlightened man, but they don’t want “wimpy.” And society and the workplace are fraught with contradictions—dads are encouraged to care equally for their children, but don’t get paternity leave; men are supposed to respect and desire successful women, but are still pressured to be the breadwinner; and who the hell is supposed to pay the check on a date anymore? The feelings associated with this societal transformation range from frustration among Millennial men who want to spend more time at home with their kids, but whose bosses don’t understand, to men who are embracing “dude stuff” with a veneer of irony to protect them from being judged. This can lead to lots of self-editing (“I love my wife’s cooking. I mean, I cook too, I actually enjoy it…”). Meanwhile, “Man Cave” is practically a chapter in the Ikea catalogue, as men try to create a space where they can let loose and just “be a guy".
Brands should therefore start analyzing how the shift towards gender equality is creating new tension points for men who feel caught between potentially radically opposite expectations.
As this transformation towards gender equality is taking place, the pitfall to avoid is to confuse it with gender neutrality
Ultimately, the only part of the gender equation that is really changing is the evolution from arbitrarily pre-determined gender-based needs towards shared needs across genders. However the reality is, men and women are not the same, and should not be marketed to as such. Men and women definitely want different things from life and from each other. Perhaps unexpectedly, the recent explosion of transgender people in pop culture has fueled more conversation about these differences, as males who’ve transitioned to female sing the praises of essentially female traits, and vice versa. Being a woman or a man means something—it always has, and it always will.
So at the end of the day, gender-marketing needs to free itself from the gender needs (what genders are supposed to do) to better address the gender wants (what genders really like to do).
So as you think about addressing the new terms of gender marketing, marketers should think abut the following questions:
· How much of your current marketing strategy is supported by gender specific assumptions?
· Which of the needs that are gender-specific now are most likely to become shared needs across genders?
· How does your brand help men ensure a smooth transition between old and new masculine values—either by helping them avoid the pitfalls (too wimpy/too macho), or by making them feel more comfortable with where they currently stand?
· How can your brand uniquely target men and/or women, speaking to what their genders uniquely want while also respecting the new landscape of equality in terms of needs?
FROM AN 'ECONOMY OF GOODS' TO AN 'ECONOMY FOR GOOD'
At Black Bamboo, we believe that purposeful innovation is good for business. Around the globe, we are witnessing major societal and technological shifts embed the idea of 'human progress' into innovation, whether it is in the way that new products and services are thought about, or in the way entirely new business models are designed.
Say goodbye to the 'economy of goods'. Here comes the era of the 'economy for good'.
With the rise in consumerism and gazillions of products to chose from, more and more people are choosing to buy from brands and companies that share their beliefs, values and passions. Some consumers do this to feel part of a greater cause, others do it to foster bonds and be part of a collective, while a final set of consumers sees these purposeful brands as a symbol of their ales to wear with pride. Companies and brands need to tap into these new consumer needs by showcasing their unique sense of purpose, becoming part of a community or showing that they care about more than just profits.
Some ways to rethink how you can innovate for good to align with these consumers needs are by:
· Creating new business models with a built-in purpose that allows consumers to feel like they are buying into a cause and not just purchasing a product. Two companies that successfully achieved that are Toms and Warby Parker, which started with a buy-one-give-one approach and are now expanding into more causes that people can rally behind. This allows more cause-conscious consumers to move away from mindless shopping and satisfy their need to make a difference.
· Developing new partnerships that allow companies to become active participants of a community and not just a faceless corporation. An interesting example of this is West Elm's Local initiative to carry locally designed and made products. This allows consumers to connect with local artisans and feel like they are a part of a greater collective while helping these small businesses grow from the ground up.
· Expanding offerings to content, products or services that are not just profit-driven, but allow people to embrace them for their purpose-driven badge value. Product (RED) and Prius are great examples of this. They allow consumers to celebrate their beliefs through the purchase of these products that they can then proudly display.
Meanwhile, as corporations are increasingly competing for talent around the world and looking to act as good corporate citizens to woo partners and capital, finding ways to create innovative business models that can fuel human progress ends up being a good business practice. For instance, some organizations and institutions are looking for ways to adapt existing technologies to promote progress:
· GE's Ecomagination initiative to create portable EKGs in India using smaller, battery-powered tools that are more affordable and logical for doctors-on-the-go who don't have constant access to electricity
· Unicef Innovation Lab's use of SMS technology for safe pregnancy monitoring and early HIV detection of newborns in countries where access to information and mail are not always reliable or fast.
On another level, more people are adopting values of 'sharing' and 'meaningfulness' and starting their own businesses as a way to address deeply human problems.
· Hot Bread Kitchen sells multi-ethnic breads inspired by different countries as a way to incubate programs dedicated to increase economic security and integration of foreign-born and low-income women in NYC.
· Soup Detroit's micro-granting dinners fund creative projects that promote community development in Detroit
· New crowd sourcing and funding platforms such as Kickstarter are helping more individuals pursue their dreams by allowing others to participate in a way that is beneficial to all
We'd like to leave you with a few thoughts:
· Is your business vision adjusting with the mega shift from an 'economy of goods' towards an 'economy for good'?
· What is your business' competitive advantage in leveraging a strategy 'for good'? What is your risk and disadvantage not to do so?
· Can your business model help you adjust to the 'economy for good'?
· What is your target audience's motivation to do or be associated with an 'economy for good'?
· How much of these insights are driving your product innovation strategy?
NOW & NEXT: 4 macro forces that could re-frame the future of alcoholic beverages
At Black Bamboo, we believe that innovation is a force for progress that not only solves for today’s needs but also paves the way to future growth.
That’s why we constantly strive to understand how macro forces are likely to create paradigm shifts in any given category, opening the door to new growth opportunities, but also creating new challenges for incumbents.
This is the first of a series of point of views that we will be developing to stir a forward-looking discussion among the marketing and innovation community.
1. What will be the effect of the progressive legalization of cannabis on alcoholic beverage consumption?
With Jamaica, Alaska and DC recently joining the ranks of places where cannabis has been legalized, the question seems to be how (and probably no longer ‘if’) open consumption of marijuana will re-define recreational alternatives.
Food for thought: Will marijuana have a positive or negative impact on the spirits category at large? Will marijuana have an impact on socialization patterns and activities, therefore shifting the balance of on / off premise spirits consumption? Will it inspire new kind of brews?
2. How will new culinary trends open the door to new kinds of spirits?
Around the world, chefs are re-mastering and re-discovering local ingredients (e.g. edible flowers or yuzu) and old techniques, blending them with foreign or more contemporary ones. These new culinary trends eventually trickle down in the consumers’ plate (e.g. quinoa, amaranth…).
Food for thoughts: Can we expect a new range of alcoholic beverages based on or accentuated by these new ingredients? How could molecular gastronomy redefine the spirits industry?
3. Can boomers become value creators in an ageing world?
The so-called ‘developed world’ is getting older. Yet most brand building efforts in the spirits category have been openly targeting younger demographics, hoping to recruit them early on and keep them in the brand franchise for life. Meanwhile boomers are going to be increasingly retiring with high disposable income and could fuel the trend towards premiumization.
Food for thought: Should the spirits category re-think its marketing strategy to more openly target boomers? What new alcoholic beverages could better cater for Boomer’s taste palates and overarching needs?
4. Will the sharing economy open the door to new kinds of relationships and brand ambassadors?
From Airbnb to Uber to crowd funding, the idea of sharing an asset for the personal benefit of all is transforming the way people get access to products and services and the level of personalization they expect. Meanwhile these disruptive business models are creating a new definition of brand ambassadorship and consumer loyalty. Mass brands may need to re-invent themselves if markets become more informal and consumers start to expect greater personal (emotional and financial) upside from the products and services they buy.
Food for thoughts: Should national wineries and brewers consider dedicating part of their production facilities to smaller scale brands? Or should they embed the idea of part ownership into their business model?
We’d love to hear your thoughts on how future macro forces can help us think differently about the future direction of the alcoholic beverage category.
Re-thinking individualization in the digital era
Consumers have always been drawn to individualization.
And it’s become a given today, with technology streaming the world to our fingertips and the 3D-printing revolution approaching. People expect to buy and consume exactly what they want—and to be able to choose how and when to consume it. It’s a brave new world that poses challenges not only to manufacturers and retailers, but also to consumers.
Historically, manufacturers have tried to meet the demand for individualization by offering a plethora of options: Choose your color and finish! Add a salted-gojiberry swirl! Put a bird on it! But it didn’t take long before this approach became unsatisfying for consumers (who felt both overwhelmed by all the options, and underwhelmed with the choices), and challenging for manufacturers to implement.
Meanwhile, consumers have come to realize they don’t want to be given carte blanche to individualize. They don’t always know what they want until they stumble upon it—and the process can take more time, effort, or creativity than the average consumer can give. Ultimately, the feeling of exploring and discovering that comes with individualization ends up being just as important as the need to assert their personality.
We believe we are at the dawn of a new era we call “open/ended individualization.” Individualization in this era will be simultaneously:
· open because it encourages exploration and discovery (vs. presenting a closed set of options)
· ended because this discovery happens within a manageable framework (vs. a blank canvas)
Instagram is an example of open/ended individualization: using a set of filters and frames, the user is empowered to create something original (without feeling overwhelmed). At Chipotle, or the west-coast chain In & Out Burger, the consumer chooses from a handful of options on a limited menu board—then modifies it with a fun request from the ’secret menu’ (“quesarito,” anyone?)
We leave you with two questions:
· Does your brand tap into the desire for exploration and discovery?
· Are there new or innovative ways your products and services can allow for open/ended individualization?