What’s Your Business, Really?
Brands need to ask and answer this question honestly: what business are we in, really? If they don’t, they should be prepared to be disrupted. That’s why we’ve identified offering as one of the five gates brands must pass through to be successful.
The mistake has been made over and over, and pointed out again and again by experts from Theodore Levitt to Gary Vaynerchuk.
It’s not the railroad industry. It’s the transportation industry.
The customer doesn’t need a drill. They need to make a hole.
Understand your core business or get ready to be disrupted.
Vanerchuk’s recent post put the spotlight on both Uber and Airbnb, two companies that have created more than their share of disruption. Not that the companies did anything wrong. To the contrary, they just exploited the true need using new ways to connect. The taxi and hotel businesses are playing catch up because they failed to realize what people really wanted.
People didn’t want a taxi. They wanted a quick, safe and easy ride at a fair price.
They don’t need a hotel room. They need an affordable place to stay away from home.
Mr. Vanerchuk says, “I wake up every morning and think about how I can put myself out of business. By that, I mean I think about every way another business can disrupt my profit margins and my current successes. By thinking about what they could do, I can do it myself and innovate my own business … putting myself out of business is better than letting someone else do it for me.” That’s sage advice for anyone, but especially mature brands that might become complacent with their current success.
It would be naive to think that these disruptions are going to stop anytime soon. As technology, data and the Internet of Things (IoT) come together, the rate of disruptions are sure to accelerate. That’s why it’s critical that brands take stock of their core business. Consider these examples:
Is the core business of Tide a laundry detergent? Or is it the best way to care for clothes at home?
Is television cable just a line that connects a box in your home to a box and satellite dish somewhere else? Or is it all types of onscreen entertainment available through a single platform? As content marketing expert Robert Rose astutely notes, “television is not a device on your wall anymore.” It’s much bigger than that—people watch “TV” on their smartphones.
Are Chrysler, Ford and Honda just automobile manufacturers? Or are they in the personal transportation business? How will a self-driving car impact what they manufacture today? One thing for sure is that the landscape is changing. Those that don’t keep pace will be left behind.
Local Brands Can’t Sleep
Even local institutions like restaurants aren’t immune to potential myopia. For instance, many restauranteurs logically assume that patrons are there specifically for the food. That might only be part of it. It’s likely or even probable that for many more upscale restaurants, people are there for a special occasion: an anniversary, birthday, or other celebration for instance. That doesn’t mean that the food can be poor, but it means that the overall experience has to deliver on top of it.
Mature Brands Navigate The Change
Brands are considered mature when consumers begin to neglect them. And one thing is clear: brands that don’t take stock of their core offering and re-energize their brand as their market grows and evolves are prime for disruption. The result? Losing brand equity, customers and the ability to maintain, let alone grow, your business.
Five Gates of Branding
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