Perspectives
Value dilemmas are a recurring theme across many different industries. From travel to technology, retail to energy, automotive and financial services and beyond, our discussions with clients consistently highlight this shared challenge.
“How can we defend our premium brands when people are shifting to private label?”
“How can we be fashion forward, while continuing to champion sustainability too?”
“How do we lead in sustainable travel for the next generation without looking hypocritical?”
These are just a few of the demanding questions echoing across various industries. Yet, there are undoubtedly many more questions left unasked in each sector.
Value dilemmas challenge brands to demonstrate their value proposition and relevance to consumers by addressing their diverse needs, preferences, and ethical considerations effectively.
Balancing priorities like cost-effectiveness versus quality, environmental sustainability versus convenience, and traditional values versus innovation highlights the complexity of consumer decision-making. This poses further challenges for sustainable brand growth when you throw in a standard-of-living crisis and economic uncertainty.
In this scenario, consumer behaviour shifts to value-conscious spending and changing brand loyalties. Reduced spending poses challenges in stimulating demand and maintaining sales growth, while heightened competition may lead to aggressive pricing, promotions, and marketing, making it difficult for brands to sustain and/or gain market share.
Consumers face additional dilemmas as they balance factors such as price, quality, ethics, sustainability, and personal values when choosing a brand. These conflicting considerations disrupt decision-making processes, complicating the selection process.
Furthermore, consumers question whether their favourite brands are worth the investment or if they can afford them altogether. While new brand choices also receive closer scrutiny. Are they worth the risk? Will they live up to expectations? This is leading to decision fatigue and wariness among consumers. In this dynamic landscape, brand relationships are being tested like never before.
Bridging the solidarity gap
In this challenging environment, how can brands maintain sustainable brand growth and create lasting value for all stakeholders?
Brands must bridge the solidarity gap with consumers, empathising with their experiences and actively engaging in their struggles. While empathy is crucial for understanding, solidarity drives meaningful action and lasting change. To truly make a difference, brands must collaborate with customers to create a more just and equitable world.
Uncommon solutions
There are several ways to achieve this. Brands may choose to focus on environmental sustainability, aiming to reduce their carbon footprint by adopting eco-friendly practices throughout their operations.
For example, Patagonia’s unwavering pledge to people and the planet has been its hallmark. Its initiative to reduce water usage, minimise waste, and use recycled materials in its products is well known. More recently, in efforts to build trust and maintain reliable relationships with consumers, it has announced it will no longer put corporate logos on their products, arguing that logos reduce the lifespan of a garment, making it harder to resell. By aligning its business practices with environmental values, it has cultivated a loyal customer base and achieved sustainable growth.
Similarly, IKEA is recognised for its commitment to sustainability and environmentally friendly practices as it aims to become a circular and climate-positive business by 2030. Additionally, Johnson & Johnson has set ambitious sustainability goals, including achieving carbon neutrality and advancing a circular economy for its products.
Other brands, such as TOMS, has embraced the path of social responsibility by investing in initiatives that enhance and benefit society's well-being. Through its 'One for One' model, for every pair of shoes sold, TOMS donates a pair to a person in need, thereby strengthening its brand reputation and encouraging customer loyalty.
Similarly, brands that are honest by design, take action and are perceived as being bold and creating change will resonate with consumers who may have become disillusioned by inaction. Examples include Carrefour’s decision to put warnings on products facing shrinkflation until the targeted suppliers agreed to price cuts. While Tony's Open Chain is an industry-driven initiative aimed at fostering transparency and accountability in the chocolate supply chain. Companies like Huel and Ben & Jerry's have joined in support of this model.
Innovation and adaptation can also be key for sustainable brand growth. Tesla, known for its commitment to sustainable energy and electric vehicles reducing reliance on fossil fuels, exemplifies this through technological innovation, rapidly disrupting traditional automotive markets.
Brand growth requires a holistic approach
Sustainable brand growth requires a holistic approach that integrates environmental, social, and economic considerations into business strategies. Amid the global permacrisis, brands have a chance to step up. People, disappointed by institutional inertia, seek change. Brands must connect authentically with customers amidst cost-of-living crises and unrest, focusing on genuine values and needs. Key to this is implementing data-driven decision-making to gain a deeper understanding of consumer behaviour.
At Hall & Partners, we are experts in measuring and understanding brand health and brand growth, using integrated, mixed methodology and advanced analytics to help businesses identify patterns and trends in customer interactions, preferences, and purchasing habits.
This granular understanding enables brands to better meet the needs and desires of their target audience, ultimately driving customer engagement, loyalty and growth.
