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“The ambitions of many brands have changed. Maybe a brand used to aspire to be a billion dollar brand or aspire to be really big. Now, especially with digital and e-commerce where you don't have a buyer making assortment decisions, brands can often aspire to be small and to only cover a specific niche or a specific category and be a $100 million dollar brand.
I think those ambitions are changing and present a really different competitive set to the more established brands, and particularly established CPGs.” — Andrea Leigh, VP of Strategy, Ideoclick
Digital has completely transformed what it means to be a brand today. From the rise of direct-to-consumer (D2C) channels to retailers embracing private label and the emergence of niche challenger brands, companies now need to have a fine-tuned omnichannel strategy to successfully compete on the digital shelf.
Andrea Leigh, an Amazon alum and vice president of strategy at Ideoclick, which works with brands to drive ecommerce growth, says brand building is dramatically different in the digital age. However, many larger brand manufacturers haven’t yet fully adjusted or embraced a new approach.
“With social, you're starting to see all these D2C brands come to fruition. There are a lot of ways to be an important brand that has traction and has a following, and I think they're different from what they used to be 20 years ago,” Leigh says.
Leigh appeared on a recent episode of the “Unpacking the Digital Shelf” podcast, “What It Means to Be a Brand Today.” Here are her insights on the three key ways what it means to be a brand has changed and how brand leaders can pivot and build their companies for the current moment.
Brands are more ambitious today than ever before, but the nature of their ambition also has shifted.
“The ambitions of many brands have changed. Maybe a brand used to aspire to be a billion-dollar brand or aspire to be really big. Now, especially with digital and e-commerce where you don't have a buyer making assortment decisions, brands can often aspire to be small and to only cover a specific niche or a specific category and be a $100 million dollar brand,” Leigh says. “I think those ambitions are changing and present a really different competitive set to the more established brands, and particularly established CPGs.”
Many brands are aspiring to be small and own a particular segment of the market, but without social media, a lot of this wouldn’t be possible.
Several social media stars and influencers have gone on to launch their own brands, Leigh says. Kylie Jenner is probably the most striking example of this with her billion-dollar brand, Kylie Cosmetics.
“The brand is an extension of the person, which is entirely new territory in the last 10 years. You can reach customers and target them in new ways.” — Andrea Leigh, VP of Strategy, Ideoclick
Increased brand accountability is another trend that is reshaping what it means to be a brand today.
“The customer gets to be the vote. They're voting with their dollars, but they're also voting with their reviews and social media endorsements, or potentially, their social media complaints about the brand,” Leigh says.
She adds that every product or service now fits the definition of a brand. A grocery or restaurant delivery service can be a brand, an airline can be a brand or a single product can be a brand.
“All these things are brands and that accountability is really important, and not necessarily just accountability from a corporate social responsibility or sustainability perspective — although those are also really important — but accountable to customer feedback and being a part of that conversation,” she says.
Leigh gave the example of a brand that manufactures a personal care appliance product and only had 3.5 stars on Amazon. The brand mined its customer reviews and discovered customers had an issue with the charger that came with the product. The company then addressed this design flaw, redesigned the charger, and relaunched its product.
The company showed customers it was not only responsive to their feedback, but also willing to incorporate this feedback into its product development cycle.
Leigh says changing brand ambitions, social media’s impact on brands and increased brand accountability are the three main ways brand building has changed and that “brands who can take these three areas and really leverage them to drive success for themselves are the ones who are going to win.”
Consumer packaged goods (CPG) brands are also innovating in their own way.
“What transformative might look like for a large CPG or a traditional brand is acquisition,” Leigh says.
In recent years, CPGs have turned their attention to smaller, upstart brands to gain traction with niche audience segments. Some prime examples include Unilever’s acquisition of Dollar Shave Club and Pepsi’s acquisition of SodaStream.
However, Leigh says this can sometimes stifle innovation within the smaller brand and cause it to lose some of the unique selling points that attracted its niche customer base in the first place.
“The uniqueness of them is what made them successful in a lot of cases. Applying a consistency in anything — like marketing, branding or packaging — sometimes applying that kind of consistency isn't to the brand's benefit. The individuality is what really made consumers connect with them,” says Leigh.
Still, some brands have found a way to excel amid this constantly changing landscape.
Retailers are launching more private label brands. Case in point: Target’s All in Motion clothing line.
“They launched All In Motion and within a year it was a billion-dollar brand. That's insane. When have we ever heard of anything like that?” Leigh says. “Target is so good at building brands and giving you a good reason to go into the store. I think that comes from really knowing the customer and what the customer wants.”
All of these changes, particularly with retailers going private label, means that traditional mass-market brands are getting squeezed on all sides.
However, Leigh says larger traditional brands can take steps to more effectively compete in the current omnichannel environment.
First, companies need to understand who their competitors are — not just in brick-and-mortar, but also on the digital shelf. Leigh says it’s particularly crucial for brands to understand that they likely have a different set of competitors on each channel. On the physical shelf, it may be another large brand, but on the digital shelf, it may be an upstart challenger brand.
Part of the challenge brands have with understanding their competitors has to do with the lack of robust measurement tools, but it’s also a mindset issue. Leigh says brand leaders — especially at the senior leadership level — need to shop their own brand on every channel. That means becoming a prolific online consumer.
“You need to be shopping on Amazon and you need to be the shopper for your household,” she says. “You need to be shopping online, you need to be shopping your category and you need to be shopping your brand to really understand the ecosystem.”
Listen to the full podcast to gain a better understanding of what it means to be a modern brand and how you can pivot and build your company to meet today’s standards.
