According to a survey by McKinsey & Company, 73% of US consumers have changed brand loyalties, stores, or the way they shop. To put it simply, we’re in an unprecedented shift in purchasing behaviors. This provides challenges and opportunities for brand marketers to keep their existing market share, and win new share from their competitors.
Nearly every brand has changed tactics, like adapting online strategies in reaction to new offline limitations, and doubling down on retention by increasing loyalty, and emotional loyalty in particular. Many brands are taking further steps and changing their products, quickly adapting to better fit today’s market. While product change is not a one-size-fits-all solution that’s right for everyone, in the midst of a gigantic switch in customer behavior, every brand should at least be evaluating the pros and cons behind the decision to change their product or not.
In this post, we share tips on how to evaluate whether it could be beneficial for you to shift your product, a few of the most prevalent paths for change, and key examples of brands that have recently made successful changes.
Criteria to consider:
- Consumers are purchasing based on better value and prefer essential items. Think about how your product holds up amidst COVID culture. Is it an essential purchase? If not, why would consumers choose your product now?
- Monitor what your competitors are doing and keep an eye on your customers and their changing needs.
- Legacy brands may choose to stay true to their heritage and trusted products, but refocus their messaging to foster emotional loyalty amongst their best customers, and create new consideration by spreading the values that underpin that emotional loyalty.
- Challenger brands can win attention and market share from legacy brands who aren’t actively fostering loyalty. New purchase behaviors, like increased online purchase, mean new avenues to drive visibility and consideration that might not exist in crowded shelf space.
- Smaller nimble brands, or those most directly affected, might need to refocus their core offering to fit in a changed market, or meet newly emergent opportunities.
Different approaches for change:
If adapting your product does feel necessary, there are several routes to take. Do you grow within your vertical by expanding, or do you target new areas that are growing? Do you add a new product, or do you subtract products to focus on a few core things? Again, paying attention to your consumers’ needs and fulfilling those needs will help determine your route. Here are some approaches to change with examples of brands that have done so.
Expand Vertically: Strong sales in one aspect of your portfolio is a good indication to double down by increasing relevant offerings. Importantly, they should be relevant, but not replacement offerings that can complement what’s been successful, vs cannibalizing.
A good example of this is Aerie by American Eagle. They’ve done a fantastic job of shifting their clothing collection to focus on loungewear. Their “Offline” collection continues to expand as consumers stay and work at home. If you can relate to being targeted heavily by ‘work-from-home’ comfortwear yourself, it’s because this approach continues to be successful for many brands.
Similarly, many beverage companies are helping fill the void with options for customers who are imbibing from home instead of their favorite bars or restaurants. White Claw, for example, is adding new beverages this year, with a new flavor pack and White Claw 70, a low calorie option. The new flavors peak consumer interest and give them some novelty to drive loyalty.
Consolidate Vertically: If you’ve got a broad product portfolio, a significant drop-off in one category is a good indicator of a need to consolidate, especially if your products are competing for shelf space or online marketing dollars against themselves.
Vistaprint, for example, has dialed back on their business cards and signage. Instead, they are heavily pushing masks, including brandable masks. With business conferences indefinitely on hold, the brand has consolidated where necessary and taken to a more timely market with masks.
Enter new markets: If your core offering itself is intrinsically challenged, your best option might be to consider new markets that can utilize your existing strengths and assets, at least for the near term. Also, if your existing offerings are strong, but there are new emergent markets creating unmet consumer needs, evaluate whether you have the relevant strengths to lead in those new markets.
Major hotel chains are adapting to the decrease in travel by offering daily rates for work away days, targeting business people who might be out of office and need a break from work-from-home. Marriott Bonvoy offers a Day Pass, Stay Pass, or Play Pass, depending on your desired length of stay.
Coconut Bliss, maker of organic dairy free ice cream, saw an opportunity beyond it’s robust retail offering. They’ve launched the Bliss Maker, an at home device for customers looking for an alternative to a fresh ice cream shop experience, in the comfort of their own homes.
If you’re beginning your journey contemplating a product shift, consider how you are analyzing your consumers and their needs. Crowdly’s platform helps brands tap into their customers for valuable insights at scale, creating a research community for you from the ground up. If this sounds like it could be helpful for you right now, we’d love to connect with you and share more. To explore your options, reach out to erin@crowdly.com.