Rather than make a list of 2022 predictions, here are five brand opportunities for brand leaders. Think of this as a list of “Wouldn’t it be great if…” scenarios.
- Wouldn’t It Be Great if There Were A Brand Offering Accessible Luxury Jewelry Again?
According to The Wall Street Journal, Tiffany’s French owner, LVMH, wants to steer the Tiffany brand up-market abandoning its position as an American affordable luxury experience. LVMH wants Tiffany to compete with Chanel and Hermes. Although Tiffany’s has always sold expensive jewelry, its line of silver jewelry made the brand accessible too many.
The American jewelry marketplace is particularly bifurcated with high end foreign brands such as Cartier, Van Cleef & Arpels and Swarovski on one end and mass market alternatives such as Zales, Kay’s and Jared’s on the other end. Tiffany’s, with its iconic blue boxes, gave many people an opportunity to share in the luxe of high end brands while not blowing their life-savings.
There is a concern that a brand cannot be both luxury while being accessible. Being a luxury brand means that the brand must be exclusive and rare. In fact, a professor holding the LVMH-ESSEC Chair at ESSEC Business School wrote about the fine line between maximizing accessibility and rarity. Tiffany had, in certain ways, become democratized while still claiming a luxury image. This position of accessible luxury does not appear to be LVMH’s vision for Tiffany. The new focus of the brand, according to the press, is going to be more towards the classic definition of luxury, “an inessential, desirable item that is expensive and difficult to obtain.”
Now, there is marketing hole – opportunity – where Tiffany’s stood.
Wouldn’t it be great if there were another brand that could step into Tiffany’s space? Wouldn’t it be great if there were another brand that could capture and promote accessible luxury?
- Wouldn’t it Be Great If Charging Stations Were As Ubiquitous As Gas Stations?
Car companies are focused on manufacturing electric vehicles. This is great. But, why is it that the only charging station near me is at the Whole Foods Market five miles away? Yet, on every intersections’ corners, there are at least two gas stations. If I wanted an EV, I would not be able to charge it for my commute. Bummer.
What if the big oil companies – all of which have made commitments to become “greener” – decided to turn half of their gas stations into charging stations? If these behemoths want to be perceived as credible eco-conscious entities, focusing on helping us be EV drivers would be fabulous.
This would require a huge re-alignment of resources. But, with all of their resources and R&D, imagine what could happen. What if these brands re-directed some of their innovation to electric vehicles? Instead of seeing themselves as purveyors of gas and oil, what if they reimagined themselves as purveyors of energy?
Online news brand Newstex information indicates that the legacy oil companies are investing in charging stations, but it is not a priority. Why? The fear of cannibalizing the core business. A charging station manufacturer executive said that even if an oil company were to massively invest in charging stations, “… the cost of lost revenue and shareholder value” would overwhelm any monetary benefits from electrifying.
There are some bright spots outside of the legacy oil companies. In Colorado, three oil and gas companies merged to create an entity that focused on solar and renewable energies. This entity is thinking about local charging stations as well.
The bigger news is that European oil companies such as BP, Shell and Total are already investing in charging stations. These moves are not altruistic, though: European governments are determined to eliminate gas- and diesel fueled-vehicles.
Shell acquired an American charging station company, installing its first US charging station at Boston’s Logan Airport. Chevron installed charging stations at five gas stations in California. But, according to reporting in The Arizona Sun, ExxonMobil, the biggest US oil and gas company, is not particularly interested in charging stations. Its CEO stated publicly that he just does not “get it” as charging stations use coal-generated electricity.
Wouldn’t it be great if half of our gas stations became charging stations?
- Wouldn’t It Be Great if Automotive Brands Recognized That It May Not Be The Dealership Showroom That Is The Problem?
The New York Times reports automotive luxury brands are creating “experience centers”. The hope is that changing the space where you buy a car will change your mind about buying a car in person. Online car buying from brands such as Carvana are eating away at dealership sales. As The New York Times cites from Kelley Blue Book, “…consumer satisfaction with car shopping has reached an all-time high in recent years, as the pandemic shifted more of the experience away from dealerships, digitally or elsewhere”.
Turning the luxury brand into a positive place to hang out is not a new idea. Many automotive companies took the Pine and Gilmore 1988 article to heart. Mr. Pine and Mr. Gilmore wrote a seminal Harvard Business Review article called “Welcome to the Experience Economy”. Its basic premise was that customers want to be immersed in the total brand experience through both sensory and functional benefits.
Changing the atmosphere in which customers buy cars is needed. Dealership experiences can be dreary even for luxury brands. Automotive brands hope customers will immerse themselves in the brand’s total brand experience. (Apparently, these experience centers are ways in which the brand can control the brand experience from afar rather than leaving the brand experience up to the dealership.)
If you are in the market for a non-luxury vehicle you will still be taking your chances at the dealership. At the dealership, the comparison with online auto shopping is stark. Buying and selling a vehicle on Carvana is painless. Financing is painless. Charges that dealership customers pay are not an issue. Everything is taken care of including registration and license plate, even if you are keeping your previous plate.
Will experience centers work? Cadillac tried one in 2016. This was when Cadillac moved to New York City, abandoning Detroit. It took just three years for the Cadillac experience center to close down with a lot of embarrassing Monday morning quarterbacking. General Motors moved Cadillac back to Detroit.
Whether you are lolling at the Lamborghini Lounge or participating in a Korean tea ceremony at Genesis House (Hyundai’s luxury brand), it is all still about buying a car, albeit a luxury vehicle. Perhaps luxury car purchasers are a different breed of car buyer.
Experiences are magnetic. The question is whether a lack of the car’s experiential essence is the reason people have problems with buying a car in person rather than online. Buying a car on Carvana is painless.
Wouldn’t it be great if the automotive companies recognized that it may not be the place in which the car is sold that is the driving problem with dealership sales? Wouldn’t it be great if the automotive companies understood that, rather than place, it is the process, the pressures and the practices that are the problems?
- Wouldn’t It Be Great If Brands Recognized The CMO As The Voice of The Customer?
The CMO is an endangered species. You can see this in the way enterprises shunned the title CMO. Many organizations changed the name CMO to new titles such as CSO (Chief Synthesis Officer) or CCO (Chief Customer Officer) or CBO (Chief Brands Officer).
CMOs have themselves to blame for the declining reputation and respect for their CMO role. The CMO role devolved into focusing on marketing communication tactics instead of focusing on developing marketing-driven business strategies. It is no surprise then that some wonder if the CCO is simply the CMO in disguise. Did changing the title fix the inherent problems that stem from fascination with managing the fractionalization of media channels? Changing the job title was never the correct answer.
Surprise: companies are ditching the CCO title. Apparently, the CCO title affected short-term issues but did not address the long-term issues that are critical to brand survival. One of these is being the Voice of the Customer.
The CMO’s role is to be the Voice of the Customer. It always has been. The CMO represents an objective, unbiased view of the customer to the organization. The CMO provides a single, corporate-wide center to collect, disseminate, and synthesize customer knowledge and requirements, while facilitating corporate-wide learning. The CMO is responsible for influencing the development and implementation of customer-driven brand-business strategies. The CMO’s responsibility is to be the leading C-Suite influencer addressing the entire customer experience, not just communications to the customer.
The CMO must be the business leader responsible for generating, supporting and activating a customer-driven focus within the organization. Brands must revitalize the CMO role so the function:
- Helps define the strategy for high quality growth
- Demonstrates contribution to the bottom line
- Focuses on achieving organizational alignment behind a common brand- business purpose and direction
- Helps define the Brand-Business priorities
- Is responsible for building and managing the Brand-Business plan
- Knows more about the customer than anyone else in the organization… and is the customer’s advocate
- Drives true customer-insight-focused growth strategies and innovation
- Develops and implements a Balanced Brand-Business Scorecard
- Leads customer-driven innovation through providing insights into customer needs, and problems
- Develops the price-value strategy
- And, takes responsibility for brand communications, internal and external
Brands must re-form and transform the CMO from a marketing communications role to a brand-business leadership role. Shame on brands when often the first questions for a new CMO are, “What will the new advertising be? Will there be a new slogan? Will there be a new advertising agency? What is our new digital strategy?”
Changing the CMO title was not the solution. Changing the role is the challenge. It is not enough to be “at the C-suite table.” It is important to revitalize the role when at the table.
Wouldn’t it be great if 2022 were the year brands revitalized the CMO role, reasserting the CMO as the Voice of the Customer?
- Wouldn’t It Be Great If Brands Doubled Down on Building Brand Loyalty?
Coronavirus upended customer shopping behaviors and attitudes. Key to these changes are supply chain issues. Shortages of favorite brands directed customers to alternative brands. A survey from Bazaarvoice indicates that 39% of those interviewed said they were forced to switch to an available brand. Eighty-three percent (83%) of these customers said they intended to stick with the new brand.
This does not mean that brand loyalty is dead. What this means is that brands need to be more flexible and focused on satisfying their customers. Many cite Chipotle’s ability to immediately leverage its digital platforms for ordering and marketing as a terrific example of adaptation in action that enhanced customers attachment to the brand.
Coronavirus made brand loyalty more vulnerable while at the same time more secure. Brands that were out-of-stock or unresponsive to customer problems and needs became vulnerable brands. Brands investing in knowing their customers brands and going out their way to be pandemic lifelines for customers became favorites. Brands providing data-driven personalization and interactions were able to generate and/or maintain brand loyalty.
In an interview, one of Groupon’s co-founders said brands must continue to both acquire customers and “… engage them… building brand loyalty.” He added: “I think businesses are going to be able to weather the storm because of the support they’re getting (referring to stimulus packages). But, the ones that are not thinking about the long-term relationships are just going to burn through any financial support they can get and they’re going to burn out as a brand regardless.”
Brand loyalty takes time. It is easy to lose. But, it is difficult to rebuild. Building brand loyalty is not an “in-the-year, for-the-year” action. Brand loyalty is not like Amazon Prime. Brand loyalty does not happen overnight. Building brand loyalty is long term. It takes time. This means brands must continue to invest in building brand loyalty even during these difficult times.
Brand loyalty is alive and well. Over the past two years, people switched brands but have become attached to the new brand. Wouldn’t it be great if brands invested heavily in building and maintaining brand loyalty?
Happy New Year!