Presenting recent books: Gibt es noch marken in der zukunft? [Will there be brands in the future?] by Christine Riedmann-Streitz – Experiences beyond the digital world
From Apple to Zara, from Adidas to Zippo – brands are now ubiquitous, and some have even become synonymous with generic concepts. But what sort of future do they have? Will brands die out as a result of the changes brought about by digitization?
Globalization, digitization, virtual reality, Industry 4.0, artificial intelligence – we’re living through a period of momentous changes, as these buzzwords illustrate. Will brands still continue to exist if artificial intelligence, recommendation algorithms and automation take over the job of controlling and interpreting the world? This is the question examined by Christine Riedmann-Streitz in her book Gibt es noch Marken in der Zukunft? [Will There Be Brands in the Future?]. The founder and managing director of MarkenFactory GmbH, points out what brands have to pay attention to in order not to lose trust and relevance. First, however, she looks into the question of what actually makes
up a brand and why they are important for consumers.
Brands, she observes, carry with them a certain status and promise of quality. In that respect, they provide orientation and help consumers to make decisions. There are limits to their effect, however. Studies estimate that a person who lives in Central Europe comes into contact with brands about 3,000 times per day. So there isn’t room for that much attention to any individual brand. Sharpening the identity and profile of the brand is therefore essential for future success.
Important brand values: trust and innovation
Every brand is powered by certain underlying values. One of them is trust. If this is lacking, then none of the other factors are of any use. Trust is therefore an economic factor, too. After announcing Model 3, Tesla received 325,000 advance orders within one week. With a down payment of 1,000 US dollars from each customer, that represents advance financing of 325 million dollars – and it was based on trust in Tesla and its founder, Elon Musk. This shows how dangerous it is to destroy trust through strategies aimed purely at efficiency. Strong brands represent a promise of quality and performance. Customer service plays an important role in this regard, because it helps to define the face of the brand externally.
Another value is innovation. The life cycles of a product are getting shorter all the time; the half-life of knowledge is falling rapidly, and commodity products in particular are easily interchangeable – innovations and unique selling points are what create added value. This can lead to shifts in market forces. The idea of the self-driving car, for example, has far-reaching consequences (see The passenger economy – a market for new business models worth billions). It arose not in the auto industry, however, but in IT companies.
Brands in a world of change
Digitization is leading to changes in a variety of fields. One result is that ever smaller and more powerful devices are coming ever closer to us – Sony is working on a contact lens with a built-in camera; Google and Novartis want to develop a lens that can measure blood-sugar levels to help diabetics. In view of the data collected by these devices, it becomes all the more important for consumers to have trust in the brand with which they’re forming such a close relationship.
New dimensions are coming to perception too, thanks to virtual and augmented reality. At the same time, however, technology cannot replace physical proximity: among job applicants, even digital natives say that virtual job interviews make them feel less appreciated. Nor can the surface feel of a product be conveyed digitally. Brands must, therefore, create experiences beyond the digital world. In fact, “digital” companies like Amazon and Zalando are already opening up branches in the physical world.
The important thing with regard to these changes is that brands remain fresh. Then they retain their relevance. Take Coca-Cola, for example. In the 1950s, the slogan was Mach mal Pause (Take a break). And these days, when sharing and personalization are everywhere, the slogan is: Trink ‘ne Coke mit… (Share a Coke with…).
Challenges in four dimensions
According to the author, companies and their brands therefore face challenges that can be divided into four dimensions: volatility, uncertainty, complexity, and ambiguity, or VUCA for short. What are the consequences of this?
Volatile markets are those in which changes can be expected. If the change is caused by innovations, then the brands that profit will be the ones that initiated the upheaval – like Apple with the smartphone – or the ones that can quickly build a follower position, like Samsung. But there are also other events that can lead to changes in the behavior of consumers. So brands have to be close to the customer and keep an eye on social developments in order to offer solutions at an early stage. The trust consumers have in them is their advantage in volatile times.
Uncertainty can be triggered by something like a scandal, as in the case of the incorrectly labeled organic eggs in 2013. Why should consumers pay a premium price for fraudulent labeling? Uncertainty can be warded off by a strong brand that offers its customers a solution they can have confidence in.
Complexity emerges when there is an oversupply of information. There are now many channels that can be used in parallel to communicate, and brands have to supply these channels with appropriate content in order to remain relevant. Consumers, after all, are only going to select what’s important to them.
Ambiguity arises, for instance, when there are contradictory scientific findings about active substances in foods. Here too, expertise, reputation and trust – the attributes of strong brands – provide orientation. Brand owners must not allow trust in their brand to be abused, however.
Success factors for the future
What sort of prospects do brands have for the future? The prospects are generally good – if brands heed a few important points – according to Christine Riedmann-Streitz. It is important, for example, not to view the online and offline worlds separately; these two worlds are fusing together more and more. Cities are becoming hybrid cities in which leisure activities are offered in rock-climbing parks as well as Pokémon Go games, for example. Similarly, brands have to “internalize” both worlds and become hybrid brands. Hybrid brands…
… enable a seamless customer experience along a customer journey that is no longer linear and includes the urban spaces of the hybrid city.
… offer meaningful content and use the urban space for socially relevant communication. If they are media brands, they hereby counteract the filter bubbles of algorithms that rate news solely according to the personal interest of the user.
… focus their communication: quality instead of quantity.
… have recognized how important data protection is for consumers.
… start by asking themselves what they can do to support customers in the best possible way.
Underlying these hybrid brands are interdisciplinary teams that bring together expertise from brand management, communication, corporate identity, marketing, psychology, design, architecture, art, technology and research into markets and trends. The objective is to ensure that technology is serving people. If a brand succeeds in that, it will have a secure position in the future.
Christine Riedmann-Streitz: Gibt es noch Marken in der Zukunft? Hybrid Brands – eine Zukunftsvision für starke Marken [Will There Be Brands in the Future? Hybrid Brands – A Vision of the Future for Strong Brands], Springer Gabler, Wiesbaden 2017, 24.99 euros
Christine Riedmann-Streitz is the founder and managing director of MarkenFactory GmbH. She has many years of experience in leading management positions in industry, trade and marketing. She also teaches courses at well-known institutes of higher learning and is a sought-after keynote speaker.
Author: Editorial team Future. Customer.
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