Published Jul 21, 2021
Now, more than ever, brands must act, and their social, moral, and environmental actions are paramount. The year 2020 was the tipping point for stakeholder capitalism. Consumers were watching as brands responded (or lacked response) to the pandemic and social justice movements. You’ve heard of the Attention Economy and the Sharing Economy, but 2021 will usher in the era of the Values Economy, where brand values matter to the consumer just as much as price, product, and promotion.
Over half of consumers are more likely to buy from a brand that aligns with their values. While consumer values are different from consumer to consumer, brands must work to better understand those values. There are two important points to note here. The first is that these values must align with your brand and what consumers expect from your brand. The second is how brand values are communicated and when.
Susan Vidler, European Chief Research Officer at Toluna, talks to Brandingmag about the Values Economy and what brands must do to successfully navigate it. Here’s what she has to say:
Brandingmag: What is the ‘Values Economy’ and what change will it bring to brands and consumers?
Susan Vidler: Brands operate in a very different environment today than they have in the past. The way that people (customers, employees, investors, partners, communities) interact with brands has changed and expectations of brands have changed. This means that what brands stand for and how brands communicate play an increasingly important role in the decision to buy/use its product or service.
Bm: How will this increased importance of values influence the 4 Ps of marketing (product, place, price, promotion)
SV: People are more likely to buy from a brand that aligns with their values, and others have actively stopped supporting brands that don’t. Therefore, having values that resonate with your target audience is key for brands. Brands are increasingly seeing the need to promote their values and people want to understand what a brand represents.
Bm: The way you communicate is as important as the message itself. What can brands do to ensure that the values at their core are also felt at the point of consumer interaction?
SV: People need to see a brand’s values in action. Therefore, what a brand stands for and participates in needs to translate into the customer experience. For example, if being a sustainable, environmentally friendly brand is a key part of the value proposition, then being able to see if a product is made, packaged, and delivered in a sustainable way represents this value in action.
Bm: Are there ways for brands to determine how they are performing against consumer expectations – if their values align and if consumers feel these values through both products and messaging?
SV: It is critical for brands to first understand what their target audience’s needs and expectations are so that they can meet these expectations. As the last 12-18 months have shown things can change at pace and it is important to keep up to date with changing needs, attitudes, and behaviors. Brands can use research to understand these needs and test communications before launch to ensure they resonate, have the right tone, and reflect well on the brand. At a more holistic level, brands also need to measure their brand positioning and performance against the competitive set to inform both strategic and tactical brand management decisions.
Bm: If we consider that aligning values and building emotional connections with consumers are turning out to be the pillars of lasting brand-building, should marketers start replacing ‘promotion’ with ‘people’ in the 4 Ps from their handbook?
SV: We know that people want to interact and buy from brands that align with their values. Therefore, it is really important for brands to convey who they are and what they stand for to the people they are trying to attract, and do this is in a clear, focused, and consistent way.
Bm: Values are the foundation of behavior for brands, and changing values has immense implications throughout an organization. Can brands really change values to align with their customers or will the Values Economy only force brands to pretend they care, as is the case with CSR?
SV: Understanding what customers value is key as is knowing what your brand stands for and why. Where these values overlap or align is where the opportunity lies for all stakeholders. Values need to be authentic and fit with the organization and its culture.
Bm: Why is it important for brands to have a strategic view of not only their current positioning, but also of a desired future position in the market?
SV: All brands evolve and it is beneficial to know not just how the brand is currently performing but whether the brand has the required levels of future relevance and vitality going forward, compared to its competitive set. By understanding these elements, brand managers can adapt and focus short- and medium-term actions on helping the brand to improve in line with the brand’s aspirations and customer needs and expectations.
Bm: We’ve seen empathy be a defining characteristic of marketing and messaging, but why are we seeing so little of empathy as a defining characteristic of brands (and not just their marketing)?
SV: It is extremely important that values don’t just resonate with the target audience but can be seen in terms of the actions and decisions the companies make. If there is a disconnect this is easily identified and undermines the authenticity of the brand purpose. Empathy is a great example of this; if the marketing communications are sensitive to the needs of the audience, but then this doesn’t translate into the customer experience, the brand experience falls short.