Something I picked up to read the other day was 'Brand Bubble' by John Gerzena and Ed Lebar of Young and Rubicam.
The essence of what they are saying is that brands are fundamentally over-valued with the intangible value (the bit which can't be justified by what's on the books, and that's based on reputation etc) that they carry around with them being unsustainable.
The authors say that this creates a bubble that could potentially wipe billions off shares once the vast gulf between how consumers value brands and the value the businesses place on them becomes apparent.
Though you can take issue with that, there are some useful statistics which show up the disconnect between how consumers view brands and how the brand owners view themselves. For example:
- According to the Henley Centre, 16 of the 17 largest UK brands showed a decline in consumer trust between 2000-2007. Similarly, Y&R found that the % of 'trusted' brands went down from 52% in 1997 to 25% in 2006
- Carlson Marketing found that in 2000 4/10 consumers expressed a genuine commitment to at least one brand. This dropped to less than 10% in 2007
- Product and brand differentiation has radically gone down. In 2005, 57% of consumers couldn't name a single one (unprompted) of the top 50 products that had launched. A year later (2006), 81% couldn't name a single one.
- Writing for Harvard Business Review, Jack Trout and Kevin Clancy found that only two categories of product - soft drinks and (surprisingly) soap - were becoming more distinct, but the other 40 were homogenizing. The authors also found that only 7% out of 340 prime time ads monitored included what could be considered a 'differentiating message'
- In 1965, according to the Newspaper Advertising Bureau, 34% could name the brand of a commercial aired during a show. Today, that figure stands at less than 1 in 10 - 8% (Having said that, wonder how the newspaper ad bureau's sales pitches are working out)
- Similarly, in Sept 2007, Forrester found that "advertisements help me decide what to buy" has gone down from 19% to 15% from 2004-2006, while "I like to research online and buy offline" has gone up from 19% to 27% (and I imagine has gone up even further since).
The reason for all this? Surprise, surprise, the democratisation of the Web and the rise of social media. According to the authors, brands by and large haven't shifted gear still keeping hold of 20th century notions of brand control. When instead:
"Like a wiki page, the concept of "what is truth" is open to critique and is always changing.
"Because Millennials live in an open source culture, they expect to co-create truths and accept they will evolve. They feel a brand's integrity is earned through openness and embracing flux, but since very few brands act this way, they have an even smaller repertoire of brands they truly trust."
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