Welcome to the new brand order

As a director for an international company that enables corporations to establish and manage their digital experience, I have seen at first-hand the effects of the digital revolution and the disruption it has wreaked across several industries in recent years. It has forced established brands to adapt to the new reality, decline or perish altogether. Kodak, anyone?

To my mind, there have been two main drivers of what global management consultancy Ernst & Young calls “the new brand order”: hard economic times and the advent of mass personalisation eradicating mass marketing.

Across all sectors, and within consumer packaged goods (CPG) in particular, customers are more demanding than ever before. Since the 2008 financial crisis, shoppers have become emboldened by a need to prioritise value over branding in the products they buy. Social media has enabled them to make high demands on their chosen brands – and to condemn them publicly when these demands are not met

Mass marketing to personalisation: re-evaluating the customer journey

Historically, the CPG industry has not fostered direct interaction with the consumer. Brand owners tended to align themselves with an array of intermediaries - advertising companies, media buyers, marketers and market researchers (sometimes within one and the same organisation), the press and retailers - in the quest for market share. In the brand new order, these relationships remain a crucial part of a brand’s marketing strategy, but they are no longer enough.

The CPG industry must also transcend its origins from the era of mass marketing and update itself to address customers’ desire for personalisation in their encounters with brands and in their shopping experience. Brand owners need to develop strategies to relate to customers’ tendency to air opinions about that experience online – sometimes to people they already know, sometimes beyond their own social networks

Personalisation has altered the path of the customer journey – the decisions and actions taken from when prospective consumers are first aware of a brand, all the way to how they relate to the brand long after they have purchased it, or not.

Brand owners must embrace technology that will enable them to track and assess the customer journeys and encounters with their brands along that journey, in whatever shape those journeys and encounters take – be that online, or within the increasingly popular “hybrid” retail spaces.

However, the industry needs an extra level of commitment and insight into customers that can only be achieved through direct digital engagement with them. “Digital engagement complements the traditional sales channel, media, and trade spend, enabling firms to market directly to consumers, engaging them in their chosen channels, shortening the time and path to purchase, and simplifying fulfilment and consumer service,” as global management consulting and technology services company Accenture describes it.

Since the 2008 financial crisis, shoppers have become emboldened by a need to prioritise value over branding in the products they buy

Entering your customers’ world

Online shopping, led by the likes of Amazon, Ebay, and Apple’s iTunes, et al., has changed customer expectations forever, about when and where they can buy, in what variety, and how soon they can receive the goods. Review sites like Trip Advisor and Yelp, coupled with social media in general, have also made consumers patently aware of the shift in the balance of power over brands from brand owner to customer and the influence buyers now have over brand value.

So, how does the CPG industry now begin to address its engagement shortfall? Ernst & Young suggests nothing short of “the realignment of the value chain by harnessing social media to hold profitable conversations with consumers and developing a multi channel strategy that is customised to the needs of the consumer and customer.”

In other words, The CPG industry must include itself in those conversations and provide the spaces in which this “always on, anytime, anywhere” dialogue takes place.

“Brands cannot deliver a relevant, effective consumer experience without also leveraging digital channels,” as technology advisory firm Forrester puts it. “They will have to engage consumers in a dialogue, serve up customised content and offers, and blur the distinction between marketing, sales, service, supply chain, and R&D in order to become consistently relevant and earn consumer loyalty.”

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Content, community and commerce.

For my money, brand owners with aspirations for meaningful digital engagement must provide consumers three key things: content, community and commerce.

The content would address customers’ increasing need to research prospective purchases online and find out how brands fit into their world and into the stories of others; it would provide unprecedented opportunities to elevate the brand, by educating, entertaining and informing consumers.

That would involve establishing and managing a roster of useful and compelling web properties for the brands, from which to interact with and present a “human” face to their public. The process would entail optimising the brand sites for mobile access. Unilever had precisely this in mind when it forged an online video channel partnership with Vice in June, to provide content to support the company’s women’s brands. The mantra “every company is a media company” has never been more true.

Brands must engender a sense of community among current and prospective customers who all have something vital in common – an interest in the brand. Brand owners must create a space for all those with a relationship with their brands to converge and articulate that relationship; a place to foster customer and reward brand advocates. Unilever’s Dove “Real Beauty” campaign managed to cultivate such a community.

Launched in 2004 and still running 11 years later, the campaign took in a mixture of off and online events to engage deeply with its core target of women and young girls in a way that went beyond ‘selling’ a product: advertisements, video, self-esteem workshops, sleepover events, publishing a book and even producing a play.

As Unilever put it at launch time: “Dove’s global Campaign for Real Beauty aims to change the status quo and offer in its place a broader, healthier, more democratic view of beauty. A view of beauty that all women can own and enjoy everyday.”

On the commerce front, brands must provide the easiest means and guidance for customers to purchase their products anywhere, anytime: be that online, via mobile apps or within hybrid retail spaces.

L’Oreal is the boldest CPG brand to embrace direct-to-customer ecommerce among a list of more cautious brands. In a review of the sites of over 30 leading personal care brands across the top 10 e-commerce markets worldwide last year, research and insights company Business360 found the cosmetics brand giant’s online engagement outperformed CPG contemporaries P&G, Unilever and Colgate by some margin.

... the industry needs an extra level of commitment and insight into customers that can only be achieved through direct digital engagement with them.

Business360 concluded that, with few exceptions, personal care brands “are mostly failing to engage consumers or build relationships to help ensure online sales,” but says L’Oréal stood out from the crowd. “Its brand sites are more popular, they have many more links-in from external sites (222 percent more links-in than the average site, while Colgate has 94 percent fewer). And visitors to L’Oréal’s brand sites stay longer - 22 seconds more than the average of 1 minute 32 seconds - while visitors to Colgate’s brand sites leave 11 seconds sooner than average.”

Select the right technology partner for the digital journey ahead

The right content coupled with an enduring sense of community amongst consumers around specific brands can drive the desire to buy. The effectiveness of the customer engagement through these two entities can be measured through analytics and fed into the company’s overarching marketing strategy. In an age where sales are no longer dictated by time and space, brand owners owe it to customers – and to themselves - to make it as easy as possible to fulfil a purchase. All three entities must be seen as inextricably linked.

For the CPG industry, fulfilling all of these requirements need not be as daunting as it may sound. There is an abundance of tech companies that will rapidly set up, host and manage the additional websites required by the brands to engender digital customer engagement, without placing any extra strain on the corporate IT requirement. My advice would be to seek them out, talk to them about your goals and challenges, and let them work with you to put your digital strategy for customer engagement into action.