brand success in the era of behavioral economics · pdf file1 brand success in the era of...
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Brand Success in the Era of Behavioral Economics
Helen ZeitounGlobal HeadBrand and Customer Experience, GfK
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“Running Faster”Improved volume, market
share, click rate…
….Brand Success by creating value through a life time relationship: short term actions also shape future value
“Building Value”Increased customerlifetime value
Business shortterm goal
End goal:Businesssustainablevalue
Business policies
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This resonates well with the lessons
we have from
Behavioral Economics
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Years 4 – 5
A
Lesson 1.
Time matters. Creating value over the consumer journey
Ebb and flow over time, creating value through experiences
lived, and lifetime relationships
Touchpoint
Experiences
Time
Year 3
B
A
Year 2
A
Year 1
B
A
A A
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— KahnemanThinking Fast and Slow
“The remembering self…keeps scores and makes the choices.”
— Diener et alEnd Effects
“Dramatic elements and endings are remembered, not the average over time.”
Lesson 2. The remembering customer dominates the rational customer
The rationalcustomer?
Or, the
rememberingcustomer
Strong memories influence decisions
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And Behavioral Economics
are so relevant to
the new connected world,
the “We” world
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Brand management and communication has changed with the rising age of the WE Marketing World
Example Lufthansa
From PRODUCT SELLING…
towards CUSTOMER
CENTRICITY
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The new value game in the „We“ world: the remembering consumer in action!
HUMAN CENTRICITY
CONSUMERBRANDRELATIONSHIPS
INTERACTIONS INTHE DIGITAL WORLD
BRANDEXPERIENCES
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BRAND EXPERIENCES
„wow“
1. Consumers are experiencing your brands in different ways everyday and these lead to impressions left
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Experiencing a brand that creates „technology wows“...
Weren‘t you „wowed“ the first time when...
You first looked up
a word in Wikipedia
as opposed to your
“reference” Encyclopedia
Britannica?
You first read how a sports
game ended using your Newspaper’s
App on your mobile instead
of waiting the next morning issue?
You first got your Chemical
Laboratory results 24h by
email instead of 2 weeks
after you paid by post?
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„Wow“ impressions can be changing our lives
3D printing will transform lives (the Strati)
http://motherboard.vice.com/read/this-mostly-3d-printed-car-is-about-to-take-its-first-drive
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Beers brands experience, on an app, in your Smart Kitchen, in Millennials events
Bud and Bud Light lost4.3% share in 12 years
“Wowing” via emotions with beer brands
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SOCIALIZATION OF BRANDS
2. The Remembering Consumer interacts in the digital
world, and shares good or bad experiences…
WebBuzz on Twitter
can show negative!
The Remembering Customer may also kill your brand
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CONSUMER
BRAND RELATIONSHIPS
3. These interactions and positive “wow” experiences lead
to increased connection between consumers and brands
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Experiences drive personal relationships with brands
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And relationships with brands evolve over time
Example of a personal relationship story with the brands Twitter and Facebook
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Re-thinking the whatto measure to reflect
this new world
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HARNESSING YOUR HARNESSING YOUR
BRAND FUTUREBRAND FUTURE
In this new game, In this new game,
the paradox of howthe paradox of how
We still work on We still work on
brand success brand success
How do you measure this?How do you measure this?
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Can linear frameworks measure the non-linear reality?
Choice
Consideration
Awareness
Purchase
Loyalty
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RadioCinema
Sponsorship
Smart-
phoneYoutube
Friends
Retail/OfficeOutdoor
Hotline
Loyalty
programs
Coupons
Youtube
OnlineBanner
TV
Website
Social Media
Shouldn’t we break down the silos?
Product/ Services/ User
experiences also leave feelings, build value
BRAND EXPERIENCE: paid, owned, earned
CUSTOMER EXPERIENCE: tech, service, design
People do not separate
experiencesthey have with
brands
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Brand Communication is only one part of the journey
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Our industry responsibility:
Think.. non-linear, integrated, future oriented brand model
Acknowledge the new world, frame it, quantify it
Brand &
Customer EquityFuture
Behavior
Positive memorable
experiences build future behavior
when they develop
relationships
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The must: quantifying that when relationships
make prefer a brand, this impacts future market share
*Active Brand Equity divided in tertials**Share of Business measured from past 10 purchases, indexed with Average = 100. Source: 128 brands in 20 categories from US Benchmark (2012) and Validation Study (2014)
High
Medium
Low
Active brand equity* strong relationship+ prefer (2012)
Actual Market Share
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Large brands can fail
without “the right”
steering KPIs
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Case study: Puma versus Nike in Sports Apparel
Puma: traditional values
with little direct interaction with
consumers
Nike, in contrast: direct interaction
with consumers across all channels
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Funnel performance shows no differentiation
between Puma and Nike
Relevant setFirst
choice
Price
acceptancePurchaseAwareness Familiarity
100% 98% 90% 61% 17% 32%
100% 97% 88% 44% 7% 27%
100% 97% 87% 45% 7% 26%
99% 93% 79% 27% 2% 21%
99% 96% 82% 49% 14% 33%
89% 77% 63% 26% 3% 26%
73% 62% 45% 13% 1% 27%
100% 97% 88% 44% 7% 27%
100% 97% 87% 45% 7% 26%
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Image Profile
Do not agree Totally agree
Image profile also does not differentiate…
Nike and Puma are the most similar image brands
Purchase Intention
Price Premium
Recommendation
Loyalty
Identification
Likeability
Trust
Superiority
Uniqueness
Quality
1 2 3 4 5 6 7
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Market share tells a different story
Source: Panel data – Textile Panel Germany
Market Share
of Puma decreaseswhile Nike increases
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Brand experience and relationships reveal the true story
Stranger Acquaintance Dissolved Friendship
Guru Social Circle Close Friends &
Family
1%3%
11%
16%
25%
18%
2%
5%
19%
24%
37%
24%����
����
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And this is amplified through social media
Emotional Imprint Signal (Extreme Sentiment analysis)
Nike
58%
Puma
23%
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From Analysts to Detectives:
Re-thinking the how to manage brands
in the connected world,
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The how: Change your practice in brand management…detect and act with agility
Brand
Experience Management:
Detect
immediately
real life performance,
On Demand
Detect
ExplainRespond
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� Let’s challenge
ourselves as an
industry, we are at
a tipping point
� The 7 golden
principles
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Experiences
do matter, they
shape the
Remembering
Consumer
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Re-think the
Sustainable
Value of brands:Consumer Centricity
Imposes a Future
Orientation of BrandsCLV, dynamic DVs and IVs
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Re-consider
measures
to capture the future,
sensitive
and ‘life-driven’
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Do not get blind with
Data Bases capturing
the past,
not the future
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Re-consider analytics
to model the future:
predictive analytics5
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De-Silo brand data
sets, social media
is not a PR only
animal!
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Re-think a new
generation of Brand
Insights: detect
immediately, alert,
and predict
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� Re-Think together
on this wonderful
Consumer
Intelligence
Congress!
�Thank you