Innovation may be about to come of age in large organisations. This could change the role of the brand marketer all over again.
Terracycle, the recycling innovator, has grown to become a global leader in recycling hard-to-recycle waste. It has been around since the early 2000s but it seems now that its moment has come with the launch of Loop, a game changing platform that “enables consumer product companies and retailers to shift from a disposable supply chain to a durable one”.
Brilliant. So brilliant in fact that the likes of P&G, PepsiCo, Mondelez, Coca Cola and Tesco are already signed up.
This level of participation also signals another way in which Terracycle is brilliant – it is a disruptor working with dominant organisations rather than against them, as is more the norm.
In his recently published book “Unlocking the Customer Value Chain”, Thales Teixeira explains how the likes of Uber, AirBnB and budget airlines like Ryanair have “muscled in” on existing customer value chains to decouple, disrupt and disintermediate long-established manufacturing, service and supply processes.
It doesn’t stop there of course, take Apple, Netflix, WeChat and Brewdog to name but a few. They have all come from outside to, at the very least, reframe whole categories and industries at the expense of once dominant players whose responses have typically been to acquire these upstarts where possible and imitate them (usually poorly) where not.
It would be a mistake, though, to think that established organisations don’t see this type of innovation coming, invariably they are most in the know. It’s just that their set ways of doing things, on which their success has been built, struggle to accommodate the changes required quickly and profitably enough. The Economist Rebecca Henderson pointed out as far back as 1990 that the word “organisations” itself might be the relevant point when it comes to figuring out why it is hard to do new things in old organisations.
Mark Weinberger, global chairman and chief executive of EY, put it another way in the Financial Times when he wrote:
“Entrepreneurs drive innovation — often much more quickly than established competitors. Successful entrepreneurs, by definition, have figured out a way to do things better. They have challenged the status quo, asked tough questions and competed with established businesses. When an entirely new industry is created, the odds are that an entrepreneur is responsible”
The recent launch by ABInBev of an organic version of Michelob Ultra may seem like a small, even obvious, step if viewed purely from the outside in but it no doubt took strong marketing and innovation resolve and a lot of investment dollars to get that through an organisation of that size and established production efficiency. This makes Michelob Ultra Pure Gold a truly laudable achievement. In this context, Loop’s collaborative approach looks well-placed to bring further behaviour changing innovation for household brands as they seek to deliver on their purpose ambitions for people, communities and the planet.
Now, this type of large scale, positive disruption does present some challenges especially for anyone involved in managing brands. A brand’s structure, format and packaging combine to create a key part of the total brand experience. Perceptions of quality, responsible resource management and the evocation of brand personality, values and emotion have as much to do with what sits around the product as the product itself.
Generations of brand marketers and those who provide services to them have successfully generated millions in profits by adapting to perfect the art of brand creation, maintenance and evolution. And, in so doing, brought happiness, performance, comfort, confidence and any number of other benefits to people across the world.
With further disruption of channels, the increased role of data-driven intelligence and rising demand for transparency, the role of the brand manager is becoming even more complex, distributed and out of their control. Think of it like being the conductor of an orchestra who don’t know each other and who prefer to play the music their own way.
In this new world, the difference between good and great brand management will be the ability to ensure not just relevance but also differentiation. When, say, every deodorant smells great, doesn’t stain, lasts 98 hrs, is formulated to meet the specific needs of every user and comes in a sleek metallic reusable pack that protects the planet how will a brand maintain its positioning, meaning and price point?
For sure, there will be new opportunities to innovate and perhaps even differentiate at the brand identity level but long-term brand leadership will come down to Brand Marketing’s ability to continue to balance and align the uniqueness of the experiences that any given product or service creates, even ones they no longer directly control, with the overall purpose and character of the brand in question.
At FutureBrand, we call this the ‘connected brand experience’ and the most connected brands in the world have the highest ‘Futureproof Factor’ i.e. they are best placed to grow even when times change around them because they stand for something different and deliver on it every day.
Our latest research (aka The FutureBrand Index) suggests that traditional mainstream packaged good companies such as P&G, PepsiCo and Unilever are under pressure to re-establish and drive relevance and appeal in the age of conscious consumption so innovations like Loop are especially timely.
What comes after that in terms of maintaining differentiation and futureproofing their brands all over again will depend on how well they can conduct and not just further create the unruly orchestra.