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Biggest challenge for brands

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Today, technology and fashion brands have become more prominent than the brands most of us grew up with or still use every day – how has this become the case? THOMAS OOSTHUIZEN, Global Consulting Director at Acceleration, delves into the theory behind this.

We know strong and differentiated brands drive revenue, profit margin and shareholder value growth. Apple, Google and Facebook are three recent examples of this.

Yet, overall, brands have declined in stature over the years. At least many brands are under threat. Just consider how traditional brands are now lagging in the annual BrandZ (WPP) survey of top global brands. Today, technology and fashion brands have become more prominent than the brands most of us grew up with or still use every day.

There are several reasons for this:

Low growth in many industries which led to the consolidation and rationalisation of brands. Brand efficiencies across manufacturing, logistics, technology and marketing have become key drivers for success. This means differentiation and consumer value proposition discussions now often take the back seat.

The commoditisation of many industries and brands. This is evident in the decline of margins in many industries and an increase in the number of price sensitive consumers. Consumers knowing they can get a “good deal” if they shop around online, which reduces the impact of brands. Also, because social media make brand comparisons between friends easy, it further reduces the impact of brands.

The result is that consumers are no longer that loyal to brands. Even within emerging markets – once seen as (new) positive momentum for brand stature – the consumers go through a fast learning curve enabled by technology.

The empowerment of the consumer – and the availability of information on brands as well as endorsements (or criticism) by other consumers or trusted independent advisors. This undermines simplistic and “un-true”/ “half-true” statements by brands, further eroding differentiation. Outside of brands that are very emotional, like watches and fashion, it is not easy for brands to justify margins if they are the same as other brands.

Perceptually, a decline in brand differentiation in many industries, notably in financial services, telecommunications, retailers, media, ISP’s, automotive, energy, utilities and airlines. Whilst there are exceptions, the vast majority are perceived as “so-so”. Consumer research has seen this decline over a period of years: consumers view these brands as more and more similar.

Parity of product and service quality. Most brands are simply similar in how they deliver to consumers. This may partly be as a result the notion of benchmarking – pursued by most corporates at some point – which essentially made the business foundation of brands the same within the same product or service category. The same technologies being available to all have also played a role in this, i.e. telecommunications companies.

Yet, one of the key issues that face brands – it has started very subtly but is about to accelerate, is the issue of dis-intermediation. Largely enabled by digital technology.

In more and more instances, the interface between consumers and brands has declined to a level where it will be hard to regain the high ground.

The most obvious place for this is comparative websites that compare offers from various brands to select the one most suitable for a given consumer. This is rife in banks, insurance, travel, consumer goods, etc.

Another example, the bank account and the bank that is debited at the end of an Amazon transaction, is less evident than when we physically took our cheque books out to pay accounts, do online banking or use a credit card in a store. We may not even remember what account is linked to what transaction anymore.

Similarly, the telecommunications service provider is far less salient when I use Facebook, LinkedIn, WhatsApp, Messenger, iTunes and any one of a given number of brand applications. Or when I use an independent retailer to top-up airtime. Whereas with voice and sms the service provider was clear, it is no longer as clear in the sheer number of hours spent on a device doing other things. This is until such time as the brand does not deliver (bad call quality, slow data speeds, coverage issues) – and then the trigger is negative.

Even in entertainment media and content per se, parity has started. We will be watching a program not knowing whether it was produced; aired or streamed through Sky, the BBC, Amazon Prime or Netflix.

The airline I may eventually use when booking through Xpedia; the hotel through Booking.com; the brand of fridge I buy through Amazon.com, even the backpack or shirt I buy online.

We know that new brands that offer simple, direct solutions (Uber, Airbnb) are – contextualising the competitive space for consumers. Hence in salience, they define different solutions amongst new groups of consumers. This may mean for younger consumers, some older brands will never take-on the significance they once had. To change this will require hard work by brands. Some industries – as a result – are under enormous threat, notably telecommunications, retailers and banks.

Yet, there is hope!

Simply considering the recent launch of the new Tesla smaller and cheaper electric car, differentiation still works if it is substantiated and credible. Yet, there is a window within which a brand needs to either redefine itself or create a new brand that will cannibalise it.

Bottom-line, don’t wait too long! Once a brand decline starts to accelerate beyond a certain level, it takes serious executive time and resources to correct – and the outcome is not guaranteed

Arts and Entertainment

Deezer to host Hotstix’s Mandela tribute playlist

Deezer is celebrating Nelson Mandela on the centenary of his birthday by hosting a tribute playlist created by music legend Sipho “Hotstix” Mabuse.  

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Mabuse, a legendary figure in African music, first rose to prominence in the 1970s with his band Harari and later developed a name for himself as a solo artist. One of his best known songs was the global hit BurnOut in the 1980s.

The playlist takes the listener on a captivating musical journey through the life of Nelson Mandela.  It was compiled by Mabuse, who consulted with Mandela’s family and friends to ensure that the music would be relevant and accurate. The playlist also features commentary by Mabuse, which was recorded in his Soweto home.  

“I have tried to tell the story of the music that Madiba loved,” says Mabuse. “The Playlist excludes the time in prison obviously, as Madiba would not have had exposure to music in that time.  We have focused on the music we know he loved before and after that period. This recording was really an emotional journey for me, but an incredible opportunity to document these memories.”

The playlist features the music the young Mandela loved, such as The Manhattan Brothers, Solomon Linda, Brenda Fassie and Miriam Makeba.  It includes struggle songs from Chicco, Johnny Clegg, Hugh Masekela and Yvonne Chaka Chaka.  The playlist also includes Mandela by Zahara, one of the younger artists who caught Madiba’s ear.

Mabuse also offers stories of his own songs, such as Shikisha, a song greatly beloved by the former President.

“I was delighted to share my thoughts and hope the listeners enjoyed the musical journey,” says Mabuse. “Madiba did enjoy music immensely and we all have a purpose wherever we are in the world to celebrate culture and to learn from different cultures and music forms and styles.”

This playlist was inspired by the Nelson Mandela 100 campaign, calling on corporates and individuals to act as sources of inspiration and engage in conversation and action.

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Sports streaming takes off

Live streaming of sports is coming of age as a mainstream method of viewing big games, as the latest FIFA World Cup figures from the UK show. Africa isn’t yet at the same level when it comes to the adoption of sports streaming, but usage is clearly moving in the right direction.

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England’s World Cup quarter-final against Sweden was watched by just under 20 million viewers in the UK via BBC One. While this traditional broadcast audience was huge, it was streaming that broke records: the game was the BBC’s most popular online-viewed live programme ever, with 3.8 million views. In Africa, the absolute numbers are lower but the trend towards streaming major sports events on the continent is also well under way.

According to DStv, live streaming of sports dominates the usage figures for its live and recorded TV streaming app, DStv Now. The number of people using the app in June was five times higher than a year ago, with concurrent views peaking during major football and rugby games.

Since the start of the World Cup, average weekday usage of DStv Now is up 60%. The absolute peak in concurrent usage for one event was reached on 26 June, during the Nigeria vs Argentina game. The app’s biggest ever test was on 16 June with both Springbok Rugby and World Cup Football under way at the same time, resulting in concurrent in-app views seven times higher than the peaks seen in June last year.

The World Cup has also been a major reason for new users to download and try out the app. First-time app user volumes have tripled on Android and doubled on iOS since the start of the tournament.

“While we expected live sports streaming to take off, it’s also been pleasing to see that the app is really popular for watching shows on Catch Up,” says MultiChoice South Africa Chief Operating Officer Mark Rayner. “Interestingly, some of the most popular Catch Up shows are local, with Isibaya, Binnelanders, The Queen and The River all getting a significant number of views.”

With respect to app usage, the web and Android apps are the most popular way to watch DStv Now, with Android outpacing iOS by a factor of 2:1.

“We’re continuing to develop DStv Now, with 4k streaming in testing and smart TV and Apple TV apps on their way shortly,” says Rayner. “The other key priority for us is working with the telcos to deliver mobile data propositions that make watching online painless and worry-free for our customers.”

The DStv Now app is free to all 10 million DStv customers in Africa. The app streams DStv live channels as well as supplying an extended Catch Up library. Two separate streams can be watched on different devices simultaneously, and content can also be downloaded to smartphones and tablets. The content available on the app varies according to the DStv package subscribed to.

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