A strong brand portfolio is the engine of value creation

The value of a consumer goods or services company is intrinsically linked to the value of its brand or portfolio. Brand equity is rooted in how meaningful, different, trusted, and salient the brand is perceived to be by consumers. Companies with a strong brand portfolio significantly and consistently outperform the market.

A recent McKinsey study confirms this phenomenon: the world’s 40 strongest brands returned 96% more to shareholders than investment in a global market index.

Powerful brands significantly outperform the market.

Total return to shareholders, Index

While it’s clear brand value drives economic value, building a valuable brand is easier said than done, and the market is cluttered with failed or under-performing brands. In our collective experience working with hundreds of brands, we’ve found the number one determinant of success is firmly placing the consumer at the center of all brand strategy decisions. To build a strong portfolio companies must follow a structured approach that details consumer demand drivers, the role of their brands in consumers’ lives and potential for change moving forward.

Demand Maps

A critical tool for manufacturers to position individual brands and their portfolio is a demand map that captures consumer insight on key drivers of choice.

How to use a Demand Map

It’s important to keep in mind that demand maps vary by category given consumer drivers are often very different.

Below are our Portfolio Management Principles to leverage your Demand Map effectively:

Prioritize brand lanes based on attractiveness (e.g. profit potential), brand right to win (e.g. brand’s ability to deliver on key needs), marketplace coverage (e.g. available consumption), and execution potential (e.g. brands ability to commercialize).

Evaluate the ability for brands within the portfolio to extend across the demand map. Considerations include:

• Covering more spaces drives penetration but risks lower salience / relevance (Brand A)
• Anchoring in one space drives loyalty & distinctiveness at the risk of reduced scale (Brand B)
• Creating clear demand lanes for each brand

Cover demand spaces where company brands can’t stretch and competitors lack a right to play / win through innovation, acquisition or licensing strategies

How Demand Maps come to life

A legacy brand in the portable protein space came to Seurat after a new player entered the category that was able to tap into an entirely new consumer segment (Gen Z and Millennial women).

Seurat created a demand map to understand the category and unlock pockets of growth for our client to regain share. Our research unearthed that consumer needs for protein are largely driven by a combination of occasion and need. The category exists along two key occasion-based dimensions: snack vs. meal part and solo vs. social consumption. We then pulled apart dimensions further to uncover four distinct drivers (flavor, health, convenience and value) that mapped across 8 unique demand spaces.
After identifying key demand spaces within the category, brands can strategically position to capture new spaces.

Our work quickly revealed a sizable, underserved demand space: mom-approved snacks. By maintaining adherence to a handful of core portfolio management principles, our client was able to regain share by utilizing the demand map’s forward-looking insight to optimize their portfolio.

What Next

Are you looking to optimize your portfolio strategy?

Are you looking to solidify positioning for key brands? Could your organization benefit from demand map insights? We welcome conversation at info@seuratgroup.com

This year’s study celebrates the challenger brands that have successfully navigated the recent disruptive economic, political, and environmental changes by redefining the consumer value equation. With rising inflation rates, fierce national political battles, and (continued) climate turmoil, our Top 10 challenger brands are delivering on the priority needs that a growing segment of consumers no longer choose to live without in categories – climate commitment, conscientiousness and cost. We call these the ‘3 Cs’ of the evolved consumer value equation, enabling our challengers to differentiate themselves, increase their relevancy and quickly build trust.

More than ever, the consumer value equation needs to be at the forefront of brand and strategy planning, particularly for those less entrenched movers looking to make inroads. This year’s Top 10 challenger brands highlight new ways to deliver against the ‘3 Cs’.

Climate Commitment:

Conscientiousness:

Cost:

Conclusion

Today, brands have more data at their fingertips than ever
before. The challenge? Many become overwhelmed or follow it blindly, missing the all-important whys needed to shape smart strategies. Consider these examples:

• A pet food brand invested in performance marketing but struggled to articulate underlying attitudes and unifying motivations of its target cohorts, severely limiting the effectiveness and efficiency of its marketing investment.
• A confectionary brand invested in keyword tracking of a given category with three key retailer partners to support collaborative innovation. They were able to identify key claims and tag lines that performed well in the past 52 weeks but could not isolate brand vs. retailer choice factors.
• A produce brand built a custom dashboard to integrate three different data sources and found they had a clear view to what happened in the past, but no understanding of how to influence consumers looking forward.

Scenarios like these are becoming all too common as marketers are overwhelmed with data sources and the opportunity to test/learn, drive performance marketing, and optimize brand strategy. As Advanced Analytics and Insight teams build capability with data analytics, it is important to understand this is only one part of a more comprehensive consumer growth engine. It is the ‘What,’ as in ‘What is the data telling us?’ Sustainable growth comes from utilizing all five pillars of the Consumer Growth Engine.

• What: What is the data telling us?
• Why: Why is this happening? Where is the consumer headed? (core insight)
• How: How does insight come to life as activation?
• Risk/Opportunity: What does this mean for competition? R&D? Retail relationships?
• Fit: Can this brand do this meaningfully? Is there mission fit? Consumer permission?

Growth Strategy across the demand plan is limited without factoring in all five pillars. A key first step is moving beyond the what and asking, What’s the Why? That will drive greater human understanding and engagement.

A leading dairy brand provides an example of how the
Consumer Growth Engine creates opportunity.

A leading premium dairy brand plays in the family-size and pint-size ice cream space. Trends indicate that plant-based ice cream is where the growth resides. Brands are diving into plant-based expansion, and consumers appear passionate about it, driving an 11% CAGR for plant-based ice cream. Had the brand relied solely on data, it would have jumped headlong into plant-based ice cream. Instead, the team dug deeper into the whys, recognizing that in ice cream, plant-based ingredients matter far less than winning on taste and indulgence. The result? While competitors jumped on the plant-based bandwagon, the brand launched a rich, ultra-creamy custard innovation that outperformed the plant-based segment.

• What: Ultra-creamy, rich, high-end French (egg-based) custard ice cream.
• Why: Consumers turn to ice cream for indulgence and ‘worth it’ taste, not a watered down, better-for-you version.
• How: Build on the legacy of the brand and provide premium pints of consumer faves
• Risk: As other brands pursue one-off innovation with each new trend, this premium dairy brand doubled down on core equities, facing fewer competitors by providing decadence and finest quality.
• Fit: Plant-based could not fit with the brand and legacy. Activating on an insight that fits with the core promise of the brand led to rapid success.

Big data has the potential to help brands in numerous ways. Consequently, the global data market is worth an estimated $70BB in 2022, driven by messaging that growth will come with more data or faster analysis. The hurdle is that relying on big data alone gives brands ammunition to analyze only the “What.” Big data can over-shadow other parts of the consumer growth engine which are needed to create and capture consumer value. There are plenty of companies offering more data and platforms to churn through that data at an increasing rate. However, sustainable growth requires insights to blend with analysis and ultimately understand the “why.”

How to get started

To establish and action the Consumer Growth Engine leaders must ask, ‘What’s the Why?”, and brands must:

• Build forward-looking data sources and analytics
• Create cross-functional Consumer Growth Engine teams
• Collect and connect consumer “why” insights and combine with “what” data
• Wire a process to action Consumer Growth Engine insights

Are you ready to unlock the “why” of your brand to drive future innovation and growth? We welcome conversation at info@seuratgroup.com.

Gen Z raises the bar – they are steadfast in their values and expect more from all facets of their world, making what they expect from brands no different. They look for brands to not only reflect their values in mission, but also seamlessly be a part of places they frequent most – different interfaces across the digital sphere. This generation was uniquely digitally reliant & native even prior to the pandemic, and COVID-19’s impact on our whole society’s digital fluency has only solidified & strengthened Gen Z’s positioning as leaders in this realm. For Gen Z, integrated shopping (& brand marketing) across in-store and digital touchpoints has become table stakes, and their dexterity in the digital landscape has given any brand who can harness this authority, authentically, unprecedented power with this consumer & generations beyond. Furthermore, the spending power of Gen Z is second only to Millennials, closing in on $150B despite these shoppers being 24 and under.

Brands that can be part of Gen Z’s lifestyle command significant value across categories, evident by recent acquisitions of challenger brands that target younger consumers by category-leading strategics (e.g., Youth to the People (L’Oreal)).

This year’s Challenger Brand paper introduces 3 key strategies on how to win with the Gen Z consumer and identifies brands who have successfully adopted these strategies.

Challenger Brands that have successfully employed these tactics to become Gen Z Disruptors: