The DNA of breakthrough brands

The power of difference in turning short-term disruptors into long-term leaders.

The DNA of breakthrough brands
PARTNER CONTENT
Breakthrough brands are those that break the mould to deliver extraordinary value growth and financial returns. Understanding what defines and drives them is an obsession for us at Kantar, and for many in the marketing community. So, what if you could predict which brands would deliver abnormal stock market returns? 
 
The science behind breakthrough brands
 
University of Oxford’s Saïd Business School have identified that by adding Kantar’s Brand Equity data set to financial models, they can deliver a far superior model in predicting financial returns. This is significant, as the existing popular narratives that claim to define how brands grow do not use equity data as an input, thus limiting their conclusions. Oxford University’s Saïd Business School modelling achieved significantly better fit versus financial data only models – they observed a 99.5% accuracy when Kantar BrandZ data was incorporated.
 
Brand equity was the missing link in making a robust model which consistently, successfully explains strong stock market performance. And within equity, the number one contributor to extraordinary financial returns was: ‘difference.’
 
Thus, to explore and explain the fundamentals of growth through the lens of breakthrough brands — and to understand what is different about these brands — we conducted an updated analysis of Kantar’s BrandZ equity database. The result is a formidable study of over a decade of data — more than four million consumer interviews, 19,250 brands in 522 categories and 51 markets — with the goal of quantifying the relevance of salience, meaning and difference. 
 
 
It’s difference that makes the difference:
 
Congruous with the University of Oxford Saïd Business School findings, when we look at the biggest risers and newcomers to our annual ranking of the Most Valuable Global Brands, they over-index significantly on difference compared to other brand equity components. Through difference, breakthrough brands shake things up and challenge the status quo. They use difference as a platform to disrupt and, ultimately, reshape an overall category. 
 
A different understanding:
 
Does ‘distinctiveness’ mean the same thing? Is it in fact only distinctiveness that consumers react to? We can be precise about this. How we define difference at Kantar is much more meaningful. Distinctiveness is the sum of visual and sensory properties of a brand that help consumers to recognise it — but it accounts for less than 30% of difference when we examine the data. 
 
Difference is the mental connection of how consumers distinguish brands between each other and what it means to them. Product function, design, digital experiences, brand responsibility and advertising all contribute to the other 70% of difference by creating meaningfully different brand associations in the minds of consumers. The data tells us that it’s this meaningful kind of difference which primes brands for future growth. Breakthrough brands are not always the biggest brands in the category right now, but it’s their meaningful difference that puts them on a strong value growth trajectory.
 
 
Kantar BrandZ also confirms that the higher your brand’s perceived difference, the more people are likely to say it is worth paying more for. Both functional and emotional difference reveal an implicit social signal of leadership and quality that helps your brand’s ‘pricing power,’ supporting a positive value positioning. Meaningful difference accounts for 94% of the average brand’s ability to justify its pricing power through equity. Getting this right in our current inflationary times is especially important if you are looking to increase the value of your brand without significant volume growth.
 
 
Who are the breakthrough brands, and who can be a breakthrough brand?
 
Do you need to be a tech player, redefine categories, or invent a new one to truly be seen as different in the eyes of consumers? Sure, that’s one way to do it. We all know the case studies: Shopee, Airbnb, Coupang, TikTok — they are breakthrough brands. But the good news is that it’s definitely not the only route. We observed that breakthrough brands exist across a multitude of categories.
 
Fundamentally, any brand can be a breakthrough growth brand if they infuse the DNA of a breakthrough brand throughout the organisation — old or new and regardless of category. Brands like Shiseido, KFC, Tata Consultancy, and Uniqlo are a few examples from across categories.
 
So where to now, for your brand? 
 
Now that we’ve established the importance of difference, it is time to show the world just how different your brand is. Most would default directly to generating higher salience and communications about how different they are. But don’t confuse salience or communications-led growth with brand value growth. Embrace the role non-comms roles such as product and service innovation, responsibility, and experience which also play in driving preference and margin through brand difference. The role of brand growth does not stop at the moment of being available. You must build a stronger distinctive and different connected brand experience before, during and after purchase. That is how breakthrough brands are built.
 
Find out more about the DNA of breakthrough brands and download the infographic here.
 
Gareth O’Neill is Kantar’s head of brand guidance for APAC & Australia, focused on helping brands create & sustain value growth in the Asia-Pacific region.
 
Adji Saputro leads Kantar’s brand guidance solutions for Indonesia and APAC. His wealth of experience in brand and marketing management for both B2B and B2C businesses and leadership in market research, brand tracking and guidance has benefited businesses in FMCG, CPG, tech, and property.
 
Source:
Campaign Asia

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