Starbucks first took the simple concept of a better cup of coffee, delivered in a unique, comforting "third space" environment between home and work. It cracked open the coffee business, multiplying the coffee economy exponentially. But look what happened next – coffee kept on improving in almost every way. Today Starbucks looks and feels like the "7Eleven" of the sector.
We believe that when it comes to customer experiences, brands need to wake up and smell the coffee (sorry) – but they also need to make sure the coffee is freshly ground and served up just right, in an environment that is something of a sanctuary. And that the coffee makes the world a better place.
The lesson here for marketers, is that your direct competitors are the least of your worries. What you are really up against are changing customer tastes and ever-higher expectations. And it's in this environment that start-ups are ready to out-think and outrun you. If you are a traditional bricks and mortar business, the platforms want to eat you up for breakfast. Amazon wants to sell everything (better and cheaper), but any platform with a large customer base and gold-dust data might be tempted to sell what you sell. If Spotify decide to sell cars, it will have car dealerships worried, especially at a time when they are desperately trying to reach millenials.
Start-ups and platforms make for scary competition, but it doesn’t end there. In a way, your customers are the real competition. Like Reed Hastings says about Netflix’s competition – it’s not Amazon or HBO or Comcast but the local restaurant. It’s people deciding to eat out instead of having a night in with Netflix. You are competing for consumers’ time and attention and competing with all of their choices. Customers are hungry for captivating experiences, and are setting the bar of expectations higher and higher.
If Spotify decide to sell cars, it will have car dealerships worried
We as consumers are the savviest we’ve ever been. But where we see more fake news then real news, where pop culture is more influential than democracy and after witnessing scandal after scandal we are left perplexed as to what and who to believe… yes, it’s about being authentic but surely that’s always been the goal? To get someone’s attention is easy – it’s retaining their attention that’s hard.
The transactional shopping world has changed. It’s now about experiences, content, personalisation and relevance – it’s about lifestyle improvement. It must be Iess about a transactional relationship and more about an emotional one.
From technology we have changed our daily habits and needs. We want to be in control, we want things when we want them and how ever we want them. Uber didn’t create taxis; they just made the experience more convenient.
Brands need to make every interaction with every customer the very best it can be. Overall, every brand’s role is to contribute meaningfully, continuously, to improving the lives of customers. And that means improving the lives of staff, partners, the local community and the planet.
Here are five key areas that brands need to excel in to stay competitive over the longer term.
Break the mould
Be future focused, be brave and risk controversy. It’s worked many times for Brewdog; the Lithuanian capital, Vilnius, "Europe’s G-Spot" campaign was bold and had a clever use of mobile technology – it was a digital campaign that leveraged its controversy with some very mainstream media coverage.
Recognise that consumers blend across digital and physical and expect consistency and seamlessness when they come across any brand touchpoint. John Lewis still has a long way to go, and can learn from more digital native homeware brands like Made.com, but it is doing everything with a multi-channel mentality, and is leading the way in a super tough sector.
Measure results and listen to what those results tell you, honestly and non-defensively. Spotify is leveraging data better than most. It’s "Your 2017 Wrapped" is some of the best CRM ever – simple, yet smart and well executed, all by data-led design. Spotify has tried other similar campaigns that didn’t work so well. Remember "Found Them First"? It was a noble try at making every user a music nerd… and it didn’t quite work. No problem. This is a great example of a brand being honest. They tried, listened and learnt. We expect "Your 2018 Wrapped" to be even bigger.
Be tech enabled
Use technology confidently and purposefully, not for the sake of it, or because you feel you have to. You don’t have to be big to innovate with technology. Scott’s Fish & Chips, near York, became popular with Chinese visitors thanks to David Cameron taking President Xi Jingping to lunch there in 2015. Since then the restaurant has used Weibo (the Chinese Twitter) and WeChat to offer menus and other local content in Chinese. Scott’s is now Yorkshire’s unofficial Chinese Embassy and Tourist Board rolled into one. It will never go out of business with marketing like that.
Most innovations, breakthrough campaigns or successful executions get done because multiple teams or companies decided on a common vision and work collaboratively. In late 2017, when Volvo did the deal to supply Uber with up to 24,000 self-driving cars, any number of factors could have prevented the partnership. Uber is a controversial business and autonomous cars are not exactly a known entity. Volvo could only build a partnership like this through creating a vision across the entire business. The deal is future focused and won’t do Volvo’s plans to go public any harm.
There are endless buzzwords to describe our modern, tech and data driven competitive world. Competitors are ‘disruptive’. Brands strive to be ‘authentic’. Our simple take on this is that we live in the "age of improvement".
And to think it all started with the simple cup of coffee.
Lively, who have just been nominated for our Campaign Event Awards as Brand Experience Agency of the Year and Best Global Brand Activation of the Year are going to be releasing an insight series over the next quarter. Stay tuned.