What will your brand strategy be in five years’ time? Making sure your brand remains relevant to consumers has to be high on the list of marketers’ concerns. But it is far from easy to predict consumer trends, and even harder to decide how to react to them.
There are numerous examples of brands that have struggled to keep up with trends, such as DVD and video rental firm Blockbuster, which was caught out by digital advances that allowed people to download films to their laptops.
Similarly, there are those that jump onto a trend bandwagon without considering the impact on the brand. Many brands, including Habitat, have started using social media without considering the best way to do it. The furniture chain quickly found out what not to do on Twitter when an intern included hashtags of popular words relating to last summer’s Iranian protests to try and boost its profile. Twitter users swiftly condemned its approach.
But brands that start to lose focus can resolve the situation. McDonald’s, which has formerly come under fire for not keeping up with the health-conscious times, now has a future-proof strategy to help it stay on course (see case study, below).
Rather than leaving marketers to predict trends a brand should keep an eye on, a “future-proof” rulebook (see below) has been developed by research consultancy Clear that aims to prevent brands falling behind the times and ensure the trends that businesses capitalise on are relevant.
Damian Symons, UK board director at Clear, says: “The question that keeps coming back from clients is about whether there is a way to improve your segmentation so you have a future-proofed strategy.”
One rule is to build a segmented picture of the market to understand exactly who uses your product and how it sits within its industry. Many businesses don’t agree with this approach, says Symons, but he insists that understanding current markets helps to predict the future. Combined with a rule about using quantitative validated data at an early stage, this helps a business to start predicting demographic differences that will exist in the future.
Another rule states that marketers should be inspired by different sources. Instead of relying on trends in their own sector alone, marketers should look at different sources of information, such as technology experts.
Technology is where many brands seek to innovate, but as developments in this area happen so quickly, brands risk falling behind the times.
LG Electronics has been working with Clear to apply the five rules to help it predict what consumers will want from video in future, as part of a project on the brand’s innovation pipeline for the next two to ten years. LG has taken a broad look in order to examine the big issues that it wants to focus on in the future.
This process includes interviews with LG stakeholders to understand what strengths already exist in the business.
The electronics company has also held debates with experts from outside the business and looked at emerging technology from around the world to gain a perspective of where the business might need to develop in the future.
LG UK marketing director Paul Trueman says applying the future-proof rulebook created concepts that would not otherwise have been found. “We found nine trends and worked out how we could connect two or three of these together. We ended up with trends related to the product, the technology and social or cultural trends, such as people wanting to watch less content passively and create more,” he says.
Trueman says the key to protecting future brand strategy is finding a flexible concept. “It is finding something that in the long term allows us to go on a journey that doesn’t restrict us.
“It allowed us to look at how data might be handled, through a PC or TV for example. We started to think about locations in the home, and in what room and where the main TV might be, and how that would affect how it is watched. For example, should a recording device be placed next to the TV or under the stairs?”
Ultimately, the aim was to make sure the brand knew what consumers wanted in future rather than automatically taking new technology and putting it into products.
But why focus on the future? Although marketers are under pressure to get immediate results, they can’t take their eye off tomorrow’s needs, argues Tyler Turnbull, digital planning director at Publicis Modem. “The pace of change is so quick. A brand that is cutting edge today could be out of date tomorrow.”
So while no one can know what the future holds, whether a brand is big or small, steps can be taken to make predictions clearer and help protect strategy. Symons at Clear says: “Innovate in the space that is big now but also that is set to grow in the future. If you can tick both boxes, you are going to be doing pretty well.”
How to future-proof your brand
Damian Symons, Clear’s UK board director, suggests there are five principles to “future-proof” a brand strategy.
1 Build a segmented picture of the market
Understand what your market looks like now so you have a good basis on which to hypothesise in future. Not everyone agrees with putting segmentation in place, but you need a good picture of your market before looking at the future.
2 Use quantitative validated data wherever possible
You might be able to use research company data here or some historical segmentation. Injecting rigour into the process at an early stage will help gain traction internally. If you know something about age, for example, you can start to predict the demographic differences that will exist in the market.
3 Use the best of what you have
This should not be a huge, protracted or expensive exercise. You might have panel data that can be used to project how different needs are emerging in the market.
4 Keep it broad
This is about looking at the big issues you want to consider, or the ones you want to watch because you think they might be in decline. You want to be nimble enough to tweak the strategy as it evolves.
5 Look to be inspired from different sources
You can’t rely on quantitative data alone, you need to look at different sources, such as technology experts.
How McDonald’s future-proofed its brand
McDonald’s opened its first UK restaurant in 1974 and quickly became the number one quick service restaurant. However, the tide turned against the fast food giant in the early years of the 21st century, with anti-fast food film Super Size Me playing a major part in generating negative publicity.
Damian Symons at Clear says: “McDonald’s came to a crossroads in its development and if it came to the wrong decision you could imagine it would really struggle now.”
However, the brand has managed to successfully future-proof itself. It has been translating consumer expectations into tangible business applications, focusing on food provenance, a wider menu and organic milk. This has been done at the same time as introducing a programme to “re-image” its restaurants, which it hopes to complete by the end of next year.
In 2008, McDonald’s started working with consultancy Promise to come up with ways to evolve the business. Lauren Cody, vice-president of business strategy and insight for McDonald’s UK, says the brand is always looking to future-proof the way it works by talking to customers.
At the MRS Retail Research conference, she reported: “Most of the time, customers are looking for evolution, not revolution. Their expectations are always changing and you have to keep up with them. We are changing all the time, for example in ways of serving or in new types of cuisine.”
McDonald’s runs its annual Market Quest, where CEO James Skinner and an executive team of 28 including the CMO, HR and operations team visit a different city to do a comparative shop with customers. They visited Cardiff most recently with customers going in for two weeks before the company team arrive to collect thoughts and create albums documenting their experiences.
“We go out and look at the competition and other venues that might shape our customers’ expectations. We look at traditional competitors and others, such as banks, if they are using interesting service techniques,” explains Cody.
She says that while consumers’ desires change broadly, conversely they think they know about what McDonald’s represents. “Customers approach from a position of [thinking] there isn’t much to learn. But I think the ones that came with us for a day were amazed by what underpins a few moments of queuing, such as the quality of our ingredients: organic milk, free-range eggs and British and Irish beef,” Cody says.
She adds that the team was surprised by the fact that smaller things mattered, such as clean tables and acknowledgement from staff. “Speed is quite important, but consumers also want human interactions. This was a key insight that is probably not too difficult to change. But with the amount of people we have, it will probably take a while.”
For McDonald’s, this is a key insight to put into place to safeguard the future of the brand. “They don’t want us to change the speed, they just want more personality,” says Cody. “Customers sometimes get ignored. We serve 3 million people a day in the UK, so something will go wrong. We are certainly not proud of it but at least we are on to it.”