The Failing Power of Brand
30 years ago when I first started in retail, a store's brand was its most powerful and valuable asset. If your brand was trusted and valued by customers, it provided you with tremendous power and control over your market and competition. It also gave you the ability to diversify your product assortment.
Several years ago, I invested into a coffee shop with my youngest sister. Her husband had become quite the artist with roasting beans and the shop gained a notoriety in the town.
So we added food to the menu and people responded. Today's customer wants more though.
You see 10 years ago, you relied on the brand when shopping, today you rely on something totally different when you make your decisions on where to shop. Have you guessed it yet? That's right, we rely on others. The advent smartphones put a computer into the hands of over 75% of America. A computer that allows the customer to access information about you and your products. A computer that allows the customer the chance to rely on something more than simple reputation.
Add social media apps that allow instant feedback from your friends and the retail brand takes another hit. Remember when we used to shop at a store because our parents did? I have a Gen Y son. Whenever we talk about buying something, he immediately goes online to see what others are saying. I immediately go into the store I trust and ask them what they think.
HUGE shift. Yes I am older, first year Gen Xer, but even I have begun to rely more on what is being "said" online. In fact, Deloitte has been gathering research on this and found that in 2012 70% of shoppers relied on the retailer for their info, when they repeated the survey this year that number dropped to 30%!
My wife is a school librarian. She tells me stories of kids making arguments in their papers and when she asks for the proof source they simply reply, well I saw it online. Doesn't matter if the source online is reputable or trustworthy - its online! So it has to be true.
Brands no longer have the power they once did. The playing field has not only been leveled between brands it has been inverted. Apple was just named the most valuable brand in the world for 2015. Every time they launch a new iPhone, people stand in line for days to get it. But when they launched the iWatch, for the first time there was much skepticism about the product. For one, they were no longer first to market, Samsung beat them there. But more importantly, people stopped being googly-eyed over glass walled entrances and sleek store designs and started paying attention to what people were posting and saying online. More and more and more reviews were getting posted and shared that were not favorable for Apple.
Now, am I predicting the demise of Apple? Not quite. A $300B valuation can take a few hits and still be standing. The point is, they are taking hits. For years, Apple relied on its name (its brand) to drive its sales and a quirky man dressed in black pitching the products as if each one was the leap to self-awareness.
And now, they have to run commercials and do events and "convince" people versus just lining them up outside their doors.
The moral of the story is this, if you do not reinvent your brand today and then again next year and then again the next, you will become irrelevant. People don't care that your store has been in business for 75 years - people born after 1980 that is. They care what people are saying about you online. They care what their friends think. 85% of people surveyed this Spring said they went online to do "research" before making their purchase. Omni-channel is here whether you like it or not. If you are not considering yourself an omni-channel retail, you better start now. Start selling your brand online harder than you sell your products.