RISE OF MACHINES AND MOBILE TECHNOLOGY
RISE OF MACHINES AND MOBILE TECHNOLOGY
By Peter Walshe
Thursday, April 24, 2008
The
level of loyalty or “bonding” (the key metric that helps determine the brand contribution) of the current top 100 most powerful brands is more than twice that of the average brand. This is the same as we saw 10 years ago, showing that the relationship consumers have with brands is as important as ever.
The brand with the highest bonding this year is also the most valuable – Google with 45 per cent. In 1998, this honour went to Gillette (48 per cent) which still has one of the highest bonding scores, showing the power and endurance of a strong, well-managed relationship with consumers. But it also illustrates the shift from grocery and personal care brands to technology.
Looking at the top 20 bonded brands across 20 countries and comparing the findings of 10 years ago we can see this distinct shift in consumer priorities.
The number of technology brands has more than doubled, including the shift of telecommunications brands to wireless. In 1998, mobile phone penetration rates in many western countries were less than 50 per cent and computers were still a significant investment for a family.
Today in most western markets mobile phone penetration is in excess of 100 per cent and a new laptop can be purchased for little more than a couple of days' average pay – if it is not actually given away as an incentive for some other purchase. In emerging markets there are millions of potential consumers with the desire, the need and the income for technology.
Ten years ago most consumers had not even heard of Google, today's number one, or BlackBerry, this year's fastest riser and top new entrant. Now it is common to see BlackBerry users accessing the internet and searching with Google on the move in many parts of the world. It is therefore not a surprise to see technology brands are worth 52 per cent more on average than other brands in the top 100.
We seem to be more health conscious – the bottled water segment of the soft drinks market has boomed over the last decade. However it will be interesting to see how much the growing concern about the environmental impact of bottled water affects the category.
Health takes second place to convenience for some – we have seen an increase for fast food brands – but legislative pressure on advertising and labelling and self-regulation on health issues is likely to spread, affecting much of what we might like to eat and drink. This may eventually change our attitude to and relationship with key brands.
There are fewer financial services brands represented among the top bonded brands than 10 years ago and even those financial brands in the top 100 have lost a quarter of their bonding. The negative press on the sub-prime lending crisis and on financial probity may exacerbate this. A look across the Brandz data shows that consumers are nearly half as likely to tell others about financial services than almost any other type of brand, but that they are more likely to listen out for information about them. The implication is that consumers are primed to watch for negative finance stories.
Our analysis shows that one of the main barriers to bonding with financial services brands is a lack of trust, in both developed and emerging markets.
We have learnt that the top brands' success comes from four key areas:
•Strong business basics
•Clarity of brand associations
•Projected leadership
•A great product experience
Most of the brands in the rankings have strong business basics, usually backed by a strong corporate culture. GE, IBM and McDonald's (with its latest initiative to provide recognised academic qualifications for its staff) are all good examples.
The second crucial element is that the brand stands for something. The most successful brands are very clear about what they offer the consumer.
Gillette is “the best a man can get”; L' Oreal is “because you're worth it” and “for everything else there's Mastercard”.
These are the convenient handles consumers need to choose between brands.
The third criterion is whether a brand acts like a leader in its category. A brand needs to demonstrate leadership in a relevant way. Perhaps there is something in the innovation or product style or how the brand interfaces with the customer that sets it apart and drives perceptions. Nokia, Porsche and, of course, Google have these qualities in spades.
Finally, a strong brand needs to deliver on its promise through a consistently good experience – preferably a great one. BMW's driving experience, BlackBerry's ubiquitous convenience for mobile professionals and Zara's delivery of tailored fashion at affordable prices all get users talking.
As Hayes Roth, chief marketing officer at leading branding and design business Landor Associates, observes: “In the end, all the fine promises and business and marketing acumen come down to one simple question: does my actual experience with the brand meet or exceed my expectations?”
“It is no coincidence that virtually all of the Brandz top 20 most valuable brands invest heavily in providing consistently superior product, service and retail brand design as the most tangible and compelling expression of a positive brand experience.”
Innovation and revitalisation allied to a clear brand promise, delivering a great experience backed up by a sound and ethical corporation – that is the route to continued financial success.
