Extending a brand's territory
The crisis we're all going through together may act as an indicator of, not only a brand's "technological resilience" but also the coverage of its "territory of experience".
What do we mean by "territory of experience"?
Let's take the example of our best friend in lockdown. Netflix..
Netflix content viewing has become a global phenomenon. So global that an expression has even been dedicated to it. Netflix & Chill. The Netflix territory of experience is therefore, a TV series (the product) coupled with time to relax, alone or in company, comfortably installed on the sofa (the experience).
How did the brand extend its hold over this experience, beyond the product?
In states where use of recreational cannabis is legal, Netflix has released a range of hash, the effects of which are associated with a TV series. All that's needed to create the perfect setting to stream Narcos…
A spin-off strategy
This extended brand territory is a spin-off of sorts. i.e. a product or service complementary to the brand's offer.
This spin-off may be due to the brand itself, or to a strategic partnership.
For example, IKEA, which subconsciously is associated with those puzzling moments assembling a "Hokksound" cabinet, has acquired TaskRabbit, a platform for locating freelance craftsmen and handymen. Once a purchase has been made, the IKEA experience continues to generate value for the customer and business for the brand.
This diversification can also lead to a deeper shift in the brand's mission. Ford, the car manufacturer, defines itself today as a "mobility company". The focus is no longer so much on the car but more on global mobility and the "Smart City" of tomorrow.
This lockdown period may be an opportunity for brands to see that they are, in part, cut off from their customers and their audience. This may be because their products only cover part of the total experience in which their product/service is used.
Capturing this new periphery
Beyond being an opportunity, this extension is essential. According to a study by the Walker firm, this year, 2020, marks an important turning point. For the first time, the brand experience will be a greater differentiating criteria than the price or product itself.
One of the first key drivers to add value seems to us to be loyalty programmes. They can offer something other than points and discounts, have ambitions over and above up-sales and cross-sales, and, most importantly, generate new business rather than slashing margins.
For example, if your company sells sports equipment, why not offer a complementary range of paid services (such as coaching, a nutritionist and sports events) to enhance your business and engage with your community? This is what Decathlon does, for instance, with its online platform, Activities by Decathlon.
A club system also makes it possible to constantly collect data. This data would not necessarily have been collected through purchasing behaviour but rather through use. This is much more interesting.
Judge for yourself. Would you rather know that a customer bought your product on your e-commerce website from a mobile phone, or that he ran 150km in 4 months to train for the Lausanne half-marathon?
It's the latter data that provides the greatest business potential. Complementary products, personalised services, link with the community, product lifecycle tracking, etc.
It's fortunate today, that data and customer insight allow us to accurately identify the possibilities for extending the territory. We limit errors and make step-by-step progress.