‘Innovation’ is a term often thrown around when brands look to create new markets or value through disruptive opportunities. Its prominence in modern marketing can be pinned to heightened shopper expectations and choice in store, meaning many brands have little choice other than to defend their current market position or look to where future business may come from. The potential value of any disruptive opportunity, be it new market or customer segments, needs validity, and often this commercial assessment is an oversight.
It is said that the customer rarely buys what the company believes it is selling, so a comprehensive understanding of category truths and opportunities can lead to a creative leap in a brand’s proposition.
A changing environment
‘Category visioning’ allows companies to gain clarity on what their potential future could look like, and is now being seen as more important than ever with retail and customer experiences changing at faster rates. The penetration of technology throughout Southeast Asia means shopper knowledge is improving and brand transparency is now expected, making category visioning critical in order to meet consumer demands. However, the only winners will be those brands willing to invest, taking a proactive rather than reactive approach to the innovation process.
Apple has done a great job of defining its future, expanding from a technology space to one of entertainment, backed up by its recent acquisition of Beats By Dre. This was not an overnight stretch by any means, and the company's planned transition from computers to music and telecom has seen Apple capture the wider entertainment market. Many brands are not so clinical in achieving their future vision, with many innovation extensions not meeting demand and failing within a few years.
Five signs that you need a category vision
Should everyone be focused on category visioning? Here are five telltale signs that a brand needs to look to owning the future.
1. Joy gap
Great brand experiences are critical in the long-term success of attaining loyal customers, and if they are getting more joy from other category experiences, then it’s time to rethink. Whether it be the first or second moment of truth, any negative experiences can cause a disparity between you and your competitors.
2. Empty pipe
Having strong R&D capabilities allows for great innovation, but if your brand success is reliant on a topped up innovation pipeline it can leave you vulnerable. In markets where the category is defined by format, such as vitamins and minerals being consumed in pill form, lack of an innovation pipeline can leave you playing catchup, and a long-term vision can cultivate a pipeline of innovation.
3. New UX
If your primary shopper environment is rapidly changing or the way you interact and engage with your category is shifting, then owning the future is imperative. Whether it is a physical change from traditional to modern trade within category or the rapid adoption of smart technology by consumers, staying ahead and looking to the future will enhance any future brand experience.
4. Land grab
The days of clearly defined product boundaries are gone as brands continue to encroach on adjacent categories, leaving many brands struggling to defend their shelf space, battling it out to stay top of mind with the consumer. With numerous categories targeting similar occasions, the ability to certify the future market landscape is invaluable.
Brands can no longer decide whether they are digital or not: The consumer demands that they be. The lack of a holistic strategy embracing digital activation and integrated engagement means a brand will be missing a point of view on digital growth.
Understanding category barriers and consumer drivers, brands will be able to build a tailored strategy to deliver growth, through the lens of the vision of the future. This vision can link brand and business strategies, forming the foundation of a mutually beneficial relationship with customers and propelling a brand to future growth.
Tom Child is senior consultant at Clear, a global marketing strategy consultancy.