Innovate a new brand strategy
Welcome, for the last time, to our New Behaviors series. This series was designed to do more than just show how brands are responding to COVID-19 today. We wanted to give you guidance and actions for what you can do to meet the developing normal that will be the next few years.
Over the course of this series, we’ve looked at Adapters, Disruptors, and those in Recovery mode. We now look to the future for Reimagine. This quadrant explores permanent habits that are either emerging or haven’t come to fruition yet. It’s a lot of unexplored territory for many brands, but that’s exactly why it’s exciting. This quadrant attracts opportunists and visionaries who reject conventions and push for new models. This may be you instinctively, but if it’s not we will also explore how you can cultivate that culture and mindset in your organization.
How to know when to Reimagine your brand strategy
Reimagine scenarios are tricky. There’s a lot of opportunities for brands to recast decades of business practices and cultural norms. Any developments that come from this quadrant are going to be the habits of the next generation, perhaps even longer. These aren’t flash in the pan marketing responses. Reimagine scenarios don’t assume the world will go back to the way it was before. Instead, they take it upon themselves to visualize new possibilities. Right now we’re seeing the geometric outline, but not yet the full shape.
These scenarios are the nascent hintings at a new order. Brands in this quadrant haven’t been affected too badly by COVID-19. Other than that, there are no hard rules defining the brands here. They could be in consumer electronics (Apple or Nintendo), web services (Airbnb or Facebook), or B2B brands in the materials world (Milliken or Braskem America). The only certain thing is that they are well-poised to act not out of desperation, but direction.
Scenario 1 – You know consumer behavior change is coming
So far, you’ve been completely or only slightly affected by COVID-19. You might currently be playing a waiting game, holding your breath and waiting to see if and how COVID-19 will ever touch you. But you know this bubble is unsustainable and eventually change will come knocking on your door. So how can you proactively plan for the unknown?
Problem: You want to prepare for change.
Action: You won’t always know what shape a disruption will take, so focus on what you can actually control. This is an excellent time to take stock and do some future-proofing. Audit your production, inventory, and supply chain. Look at your messaging frameworks and tools. Can they support future messages? Review your brand building blocks. Your brand values can help you find brand-appropriate solutions when you run some simulations and conduct scenario planning (this series is a great first step in that). Can the fundamentals of your brand positioning support new models and channels? Where are the weak points of your business and your brand? What could impact them? Identify these priority tasks and take this moment to bolster them.
Example: Let’s look at the structure on which many companies rely: the supply chain. Everything from sourcing to manufacturing to HR, almost all aspects of a business are part of a global network, composed of layers of specialized suppliers. It’s what has made COVID-19 so devastating – affect one part of the supply chain and the whole system comes to a halt. If anything, COVID-19 is showing that we need to stop thinking of it as a linear “supply chain” and instead adopt a network mentality, one where the network is resilient and can withstand multiple interruptions. But many don’t have visibility into their complex supply chain.
Nestlé shows us how beneficial it can be to prioritize internal supply chain transparency. Besides the fact that Nestlé has high-demand, shelf-stable food products, their ability to continue delivering goods has seen the company grow by 4.3%. When talking about their success, Senior Vice President and Global Head of Supply Chain at Nestlé Vineet Khanna says “Internal supply chain transparency played a key role. Knowing which ingredient comes from where, in the end-to-end Supply Chain […] and having clear visibility on the real-time demands and needs of consumers in any market help line up supply alternatives and anticipate risk and disruptions.” Critical evaluations and scenario planning set Nestlé up to adapt, endure, and even thrive in COVID-19. As summarized by Morris Cohen, a professor of manufacturing and logistics at the University of Pennsylvania, “The nature of this problem is not forecasting, but anticipating.”
Future: This pandemic has shown the vulnerability of the ways in which we create our goods and deliver them. It is a multi-industry element that is ripe for reimagining. Will big brands that already have large infrastructures in place continue to dominate? How can smaller brands succeed? Do they actually need to step away from many distant specialized suppliers and instead bring everything in-house? Will we see a rise in one-stop shops? Will branded communication incorporate guaranteed delivery of products and services? Can brands differentiate themselves via supply chain models? Or will trade secrets and brand differentiation become less important as we adopt easy-to-replicate standardization (like IKEA)? And while we’re increasing transparency of suppliers and supplies, will ethical, fair-trade practices become a heightened brand value? As mentioned, supply chains span many industries and categories. Reimagining them will have world-changing affects.
“We work continuously with our supply chain to help them navigate challenges as well.” (New Behaviors Research, April 2020.)
Scenario 2 – You’re struggling to find the right groundbreaking idea for your future brand strategy
You might be thinking to yourself, “Yes, I understand, I can really change the world. And I’m excited to do so. But how?” You most likely have stable resources, and in a world where stability is difficult to find, you in turn are hard-pressed to know where the opportunities are.
Problem: You’re at a loss for how to innovate.
Action: Adopt a scarcity mindset. Frequently a lack of materials or options forces us to come up with the most inventive solutions. Case in point – research depicts “the aftermath of the Great Depression as an era of incredible technological progress and innovation.” When doing the scenario planning suggested above, prioritize solutions that account for a shortage of supplies while still delivering on your brand promise. How can you still elicit the same aspirational mindset in your core audiences without your key ingredient? You’d be amazed at how much you can do with so little.
Example: The aviation industry has been hit hard by COVID-19. International shelter-in-place orders, health fears, and economic insecurity have all led to thousands of grounded flights. The industry is expecting to take three to five years to recover. With many airlines posting their first losses in years, many are now seeking bailouts from their governments. The airline industry of tomorrow will look vastly different from yesterday’s. Changes to boarding, servicing, costs, and scheduling are all to be expected. But what about environmental changes?
The environmental cost of air travel has been a hot topic. Climate activist Greta Thunberg made headlines by refusing to travel by air, citing its environmental impact. In 2019, the industry was responsible for about 2 percent of total global greenhouse gas emissions. As described by the European Commission, “If global aviation was a country, it would rank in the top 10 emitters.” COVID-19 has already created a dramatic drop in emissions, but a global pandemic is not going to keep airlines grounded forever. That’s why many are proposing mandating green practices as part of airline bailouts.
These are drastic demands, but where there’s a will, there’s a way. It’s just never been financially attractive to pursue. These conditions will put pressure on the airline industry to innovate. By rendering the old way of doing things scarce, airlines will have to get creative and may just embark on a whole new age of responsible travel. The question for airline brands is how their current brand positioning will support, align with, and reinforce these changes. You obviously want to be in the pilot’s seat when innovating and can ensure agreement between your brand positioning and business practices, but this example shows that dramatically overhauling everything you do can tie in nicely with other desires your audiences may have.
Future: Can COVID-19 provide some of the most controversial industries an opportunity to save the day? Fifty years from now, will we herald airlines as the industry that pushed the world away from the brink of environmental collapse? That seems absurd today, but we’re seeing rapidly emerging habits that reject unsustainable and harmful practices. Are current brand positionings enough to incorporate greener practices, or will it require a total renovation? Are brands willing to take on that challenge? Will a solitary brand rise to occasion, distinguished by a brand promise of salvation? Or will we see industry-wide standards and practices upheld by all? We’re witnessing a whole reprioritization, a cultural revolution that many traditional categories cannot afford to ignore.
“The industry will have to reshape itself as we build back from a zero base.” (New Behaviors Research, April 2020.)
Scenario 3 – You don’t know what the future of consumer habits holds for your category
You’re seeing entire categories become absolutely obsolete. You obviously don’t want that for yourself and your category. Perhaps you’re dealing with essential items, or your business is fundamental to the world continuing to operate. But as consumer habits continue to change, you understand just how precarious your position is.
Problem: Your current model won’t operate in a vastly different world.
Action: Be an agent for change. Use this time to completely remake the world, centered around your business and brand. What are the future opportunities that you can create for yourself? Unshackle your imagination from the limits of today and aspire for your utopia. Because if there ever were a time to shake things up, it’s now. If your current brand blocks are solid, any change will feel authentic. If your brand-building positioning and values don’t support your new vision, then it might be time to update them in order to follow your new course. It’s all about cohesion between what you believe and what you do.
Example: We mentioned in our last post, Recover, that those in the travel and hospitality industries are not doing well. Airbnb is top of mind. The brand that redefined the hotel category is now laying off 25% of its team and lowered its internal valuation by 16%. And yet, Airbnb is still innovating and working towards a new world, instead of worrying about its place in it. It’s in its brand DNA.
Airbnb’s culture will always be marked by its pursuit of and willingness to try new things. These innovations don’t always have to work – Airbnb just has to keep aspiring to make travel and hospitality richer and more accessible to their audiences. The first to change was their Experiences. Launched in 2016, Airbnb Experiences is an extension of its local experience brand promise. Local hosts offer up tours and classes to visitors, usually with a unique angle or insider knowledge. These have now gone virtual. Some on our team even tried a few of them for Mother’s Day. And while this is an attempt to stymie losses, it also presents a new way for people to explore different topics, not just different cultures. It leans into the existing trend of self-education, branches into entertainment territory, and allows far-flung families to share in experiences without the price ticket of a big international trip. In short, it builds loyalty around the Airbnb promise to experience the novelty and accessibility of exploration. Airbnb’s move into sublets is further proof. Working from home has recently been introduced on a global scale, with many companies announcing that it will be a permanent system. With that sort of flexibility, Airbnb is staying true to its brand culture by transforming its network of rentals into dream remote working environments. We just have to wonder, if Airbnb continues to proactively push the boundaries of their offerings, will they soon outgrow the “bnb” of their name?
Future: A brand’s culture, ethos, mission, positioning, purpose, values…whatever you want to call it, it acts as a North Star, guiding a brand’s actions and informing business decisions. How will this role change in the coming years? Will it have even more importance? Will more and more brands join the already-existing trend of “purpose-led” brands? Are those brands going to become the next era of culture creators? How much priority and attention will a brand’s purpose receive in communications? Will the what and how fade away in favor of the why? How many brands will redefine themselves in order to find their purpose? As we said before, we are facing a new age of radical reassessment. Brands will have to look deep within themselves to see if their culture can stand up to it.
Be a leader in brand innovation by using pivotal consumer habits
Those of you in the Reimagine category have a responsibility. You are in the best position to pivot, not out of necessity or to recover any losses, but rather purely for the sake of pursuing a new vision. For that reason, you can rise to be leaders who show us a new way of living. We’ve shown you some exercises to prepare. These are critical to ensure your business remains profitable, but also that brand stays relevant. In Reimagine, you can evolve your brand positioning to point towards a new vision. Your brand values can keep you honest to yourself, your teams, and your audiences. Now is the time to build a new world. What part will you play?
We’ve now come to the end of our series. We hope you’re leaving with plenty of inspiration, some lessons of what to do (or not to do), and confidence – confidence that you know how to navigate these tumultuous times. This is, of course, an ever-changing situation and, as we’ve all been made painfully aware, it can all transform at the drop of a hat. COVID-19 has forced many short-term changes, some good and some bad. The real takeaway for brands is to meet new demands with new behaviors. We here at Material like to think that by preparing and focusing on the essentials of your brand, you can not only survive COVID-19, but thrive in the world that comes after.