“New” is the top consumer demand. Can brands adapt to survive?
Among today's consumers, the safe feeling that comes with being loyal to something tried and true just can't compete with the feeling of experiencing something new. According to Forbes, "Over the last three generations, major trends in marriage, religion, politics, and corporate America have reframed expectations for surviving and thriving in this world. The consistent theme is that change is not something to be feared or avoided. Change is inherently good. And the hankering for change is increasing at an accelerated rate."1
Combined with the growing expectation that something that is worth my time and money should offer more than just the inherent product benefit, it should come with an experience, the pressure to innovate is greater than ever before.
With this constant demand for creating new experiences, it's less about a major breakthrough or transformative innovation. This kind of innovation goes beyond core product benefits or usage occasions, it could be anything from how we go to market and the buying experience to the back-end customer service. The ability to tout something new and different, whether it brings utility or any real benefit, is the new role of innovation. It's what has the ability to pull a consumer's attention to your corner, however fleeting that moment may be. Whether it's deciding if your brand needs a chat bot or if you should try a new digital extension of your product offering, just having something new might be all it takes.
And the financial stakes are higher than ever. There are more consumers in the open consideration mindset than ever before due to the erosion of loyalty and a constant desire to experience something new. This is both exciting for challenger brands and terrifying for established, traditional brands that rely on their base to sustain profitability. As reported in Forbes, "There is $6.2 trillion globally in near-constant play due to accelerated brand shifting according to a report from Accenture. Two thirds of consumers surveyed said that the number of companies or brands they consider when making purchase decisions has increased significantly compared with 10 years ago."2
Luckily, digital innovation can be equally as motivating and much less cost prohibitive than traditional product innovation. The ability to test and learn, get to market quickly and optimize and adapt makes digital innovation a sweet spot for creating new consumer experiences. If we stop thinking about digital marketing as just pushing consumers to an end destination or conversion, and start thinking about using digital to enhance a product offering we can start creating new and better consumer experiences. This is where digital engagement and promotions start to blur the line between marketing and just extending the brand.
If our digital innovation seeks to build loyalty where possible, we might be able to overcome the behavioral trend of disappearing loyalty. According to GeekWire, Starbucks struck loyalty and digital innovation gold with their mobile "rewards program, which represented 36 percent of the company's U.S. revenues last quarter. But now it seems the company is placing even more emphasis on using technology to get its current customers to spend more with Starbucks, as well as to acquire new ones, too. 'Today, we are enabling a new generation of digital innovation that will begin rolling out in waves starting this fall,' Starbucks Chief Strategy Officer Matt Ryan said." Check out other ways Starbucks has focused on digital innovation to both enhance rewards and extend the number of customers that engage with the brand digitally - including an eye toward AI and personalization.3
Check out other ways Starbucks has focused on digital innovation to both enhance rewards and extend the number of customers that engage with the brand digitally – including an eye toward AI and personalization.
1. Kusek, Kathleen. "The Death of Brand Loyalty: Cultural Shifts Mean It's Gone Forever," Forbes. https://www.forbes.com/sites/kathleenkusek/2016/07/25/the-death-of-brand-loyalty-cultural-shifts-mean-its-gone-forever/#26b570264dde
2. Kusek, Kathleen. "The Death of Brand Loyalty: Cultural Shifts Mean It's Gone Forever."
3. Soper, Taylor. "Starbucks is a tech company: Why the coffee giant is investing heavily in digital innovation," GeekWire. https://www.geekwire.com/2017/starbucks-tech-company-coffee-giant-investing-heavily-digital-innovation/