Recently I’ve been thinking about why investing in brand really matters and as it happens, we’ve just been quoted in The Times, in the Raconteur supplement “The Future of Retaill”, on this very topic.
2020 has been unprecedented for retailers of all sizes. One thing that has become clear to me is: If retailers can flex their brand and be agile, adaptable and relevant to today’s consumer, then they are more likely to survive, and in many cases, prosper. But when they don’t adapt or simply cannot get close to their customers, then it can be devastating. Look at recent news, for example.
As I mentioned in The Times, brands aren’t just about products and the bottom line, and for this reason, I believe retailers should spend more time on their brands. This takes considerable investment – but not just financial.
Back in the day, retail brands were destinations – we went to them, be they on the high street, at airports or in retail parks. But today, retailers have to come to us, wherever we are and whatever we are doing – we could be about to go for a run, walking the dog or just getting stuff done at home.
So how do retail brands connect with us when we are busy getting on with our lives? The answer is simple – technology.
The tech sector is instrumental in pivoting how we perceive what retail is all about. Technically retail is defined as the “sale of goods to the public”. But add the powers of emerging fintech propositions together with the beast of cloud and e-commerce platforms like Amazon, and then you get a whole new perspective on retail altogether. The “sale of goods to the public” is transformed.
You only need to look at fintech unicorns like Klarna – which is achieving astronomical valuation rises by transforming our retail experiences. It’s a brand so strong, it recently reached a valuation of $10.65bn as a private company.
Fintech unicorns and their brand strategies are designed to make our lives easier as end-users. Klarna makes our experience of retail even more pleasurable, with convenience thrown in for good measure. It relies on approachability, openness and brand values that are important to the millennial shopper. Why? To demonstrate to their users they really get them: how they think, what they need and how they like to get stuff done.
These values then seep into the psyches of its users, creating new levels of loyalty that can then be transitioned into the B2B world.
The old guard – the bricks and mortar banks and other types of legacy lenders, in the case of Klarna, rely on old-fashioned formalities and seriousness around the exchange of money. If you couldn’t afford to buy that sofa, and the credit card was maxed out, the “sale of goods” didn’t happen. That isn’t great but it’s a sad reality I’m sure we’ve all experienced. But Klarna, because it’s on our side, looks at that problem completely differently.
So how do retailers create a stand-out brand in a crowded, tech-powered world?
Well for one thing: brands aren’t just created out of thin air. The art of defining, articulating and bringing a strong brand to life across an organisation takes real creativity, passion, collaboration and a great deal of crafting.
Remember: brands don’t live on a spreadsheet, they live in our imagination. A brand has to know its customers inside out and why it’s there for them. The retailer’s value proposition needs to be fully thought-through, creatively expressed and clearly communicated at every customer touch-point. So whatever you do: don’t get distracted with just trying to shift the product, and ignore why you exist to sell those products in the first place.
Brands need love, passion and craft – this is what gives brands their true value to me. It’s the care and attention to detail that connects me to them. As I described in my blog “Why is Branding Important?”, I want to know if they help me find what I need. Do they make my life better? Do they make me feel good? And importantly, do I want to use them again?
The people doing this kind of creative “brandsmithing” work today are the equivalent of the R&D team behind the Aston Martin. In fact, Aston Martin even calls itself a design company.
My favourite retail brand story is this one from Nike’s founder Phil Knight. He had a vision that if everyone went for a run, just once a day, the world would be a far better place. That brand value drove every single thing he did from the products he designed, the suppliers he worked with, and the people he hired.
That brand vision has helped Nike to stay relevant to its customers decade after decade. Now for me, that’s what real brand investment is all about.
James Beveridge, co-founder