10 actions that will drive profitable share growth

This article is the introduction to a series of posts that will update my list of 10 actions that will drive profitable share growth. My intent is to reinforce learning that has stood the test of time but also reflect new learning gained since the last update. Each time I post, I will update this article with the new action, and I would love to have readers add their own point of view.

Growing share is important

Growing share, particularly in an established product category, is challenging at the best of times but fundamental to longer-term success. A company needs to at least maintain it is market share or it will not benefit from category and country growth. And growing slower than other brands cedes the advantage of scale, even if your sales are increasing. So while it might seem unrewarding at times, trying to grow share is worth the effort, provided you can do so profitably.

However, not all measures of share are equal. Focus on growing value market share if you want to grow future profits, not volume market share. And the real challenge is to grow value market share over the long-term. Small gains are easily countered by the competition, marketers need to persist in their brand building efforts, continually seeking ways to gain competitive advantage.?

Disruption creates big gains

The early years of any brand are a frenetic attempt to establish a viable user base and work out the kinks in the business model. Growth is everything, either to keep your share as a first mover or establish it as a new entrant. McKinsey finds that for software and online-services companies the growth trajectory is the best predictor of long-term success. Think Amazon, Airbnb or TikTok. But if it has a truly disruptive offer any brand can gain share rapidly, even in established and apparently inactive categories where market share has changed little for years. Think Chobani, Halo Top or Dollar Shave Club.

Start different, make it meaningful and salient

What is the best form of disruption? Something that the end-consumer perceives to be different from the current offers and which they find functionally and emotionally relevant – in other words, more meaningful. Too many marketers discount the value of perceived differentiation, and yet, when you look at the brands people think are the most disruptive they are also perceived as different. In 2018, an analysis of BrandZ data found that brands that grew over time were seen to be different compared to their competition. However, to grow in the longer-term, both the disruptive and growth brands had to make their difference salient and meaningful to more people.

Marginal gains sustain growth

But what happens when growth begins to taper off? It is time to think about marginal gains, not disruption. Big brands must seek growth wherever they can find it, from cross-selling to existing users, targeting specific segment needs, or from expanding the whole category. But here is the thing, incremental growth requires the same mindset that empowers true disruption; a mindset that questions everything and continuously seeks better ways of doing things.

Growth is the result of a series of inter-related actions

Sustained market share growth is rarely the result of any one event or action. Instead, it is the outcome of actions based around the buyer cycle of experience, exposure, and activation. Actions have differing effects and their influence on sales plays out over different time frames, but together they add up to more than the sum of the parts. An update of Kantar’s Mastering Momentum analysis finds that brands which over-performed at experience, exposure and activation grew by an average of 48% over three years.

With that in mind, here is the first of my ten things to do to drive profitable market share growth. I look forward to seeing your comments.?

1) Seek competitive advantage wherever you can

Competitive advantage can be found anywhere in the value chain: product innovation, design, route to customer, perceived value, brand purpose, customer service, and brand salience. The objective is to tilt the playing field in your brand’s favor. The more tangible and obvious the consumer benefit, the stronger and quicker the response is likely to be. Whatever form it takes, the new initiative must differentiate the brand from competition and must address a functional and/or emotional need to be meaningful to potential consumers. Without meaningful differentiation brands become commoditized and struggle with weak consumer demand. However, significant, tangible growth opportunities are rare, do not ignore the power of brand salience to influence consumer decision making now and into the future.

2) Maximize availability and ensure your brand is easy to choose

Today’s “omni-channel” is just another way of saying you cannot buy what you cannot easily find. Brands need to ensure that they are available everywhere consumers expect them to be. If it is more than a click away, good luck; few brands so attractive that people will actively seek them out. Marketers should find new ways to allow customers easy access to their brand, like virtual consultations or live commerce. Within any retail channel, online or off, make sure your brand is obvious. Make purchasing ‘frictionless’ by removing any current barriers to purchase or sign-up. Seek ways to make repeat purchase and renewal easier, like automatic replenishment for D2C goods.?

3) Build your brand bias

Anchoring is a cognitive bias that causes peoples’ decisions to become too dependent on an initial item of information. In this way, peoples first impressions of a brand act as an anchor for future engagement. Which is why marketing needs to make the brand’s meaningful difference obvious to as many potential buyers as possible, even those not in the market to buy today. Reflect your brand’s meaningful difference in every touch point, and consumer interaction with the brand, to create coherent mental “real estate” and a strong predisposition to choose the brand when the time comes. Create positive anticipation of usage, based on the meaningful difference, to enhance people’s later experience. Ensure the brand can live up to the promises made for it.

4) Build perceptions of value

People will pay more for a brand that offers them something they believe cannot be found elsewhere, be it tangible or intangible. Value is a perception; it is not a price point. Not everyone is budget constrained or seeks the lowest price. Build perceptions of value to justify your brand’s price point and help return a better margin or higher demand (remembering that margin improvement will have a greater impact on the bottom line than an increase in volume). Perceptions of longevity, durability, trust, convenience, indulgence, popularity, personalization, and more, underpin the overall belief that a brand is good value. When variants are sold under the same brand name but at different price points, make sure the perceived value of each offer is well-differentiated to avoid people trading down to the cheapest option. (For more on building perceptions of value check out the WARC guide to communicating value.)

5) Ensure your brand easily recognized

Recognizing a brand automatically triggers an intuitive response based on pre-existing brand impressions – the brand bias. Create, build, and leverage distinctive brand assets to ensure recognition, whether online or instore. Assets will include design, logos, and claims, but can extend to many different properties including celebrities, images, sensory experiences, rituals, jingles, and tone of voice. Integrate these assets into your marketing activities to build mental connectivity between brand and impressions, then leverage those assets to trigger positive associations during search and shopping.

6) Make your brand as salient as possible

Given the shift to ecommerce prompted by the pandemic, ensuring your brand is salient has become more important than ever. People cannot search for a brand unless it comes to mind easily when a need is realized. Invest in paid communications to ensure the brand is thought of automatically when a relevant need or occasion arises. Invest more in Share of Voice than Share of Market to improve salience relative to the competition. Leverage that spend with distinctive creative designed to deliver strong, brand-linked impressions that will influence purchase now and into the future. A consistent idea rooted in the brand’s meaningful difference but refreshed with new executions will help build strong memory structures. Stimulate positive word of mouth and social buzz.

7) Maximize retention of existing customers

Every retained customer is one less that needs to be acquired for the brand to grow. Deliver a customer experience that lives up to what the brand promises. Seek to apply the peak end rule: create experiences that delight, fix problems promptly, leave customers smiling. Delighted customers are more likely to choose your brand again, buy new products and services, recommend your brand, or trade up to a premium variant. Find ways to facilitate repurchase and bypass search and shopping.

8) Give your brand the greatest possible exposure

Aim to reach and influence all potential buyers, not just those buying today. Within the available budget, choose media channels that combine to maximize effectiveness and make the brand’s meaningful difference salient, then target specific needs and behaviors. Find the right balance between demand generation and activation for your brand and category, do not just preach to people already inclined to buy your brand. Adapt creative to each media channel while maintaining brand coherence, and continually optimize reach and frequency for maximum efficiency. Do not over-target, the more variables you use, the less accurate and more costly your buy will be.

9) Trigger a positive response during search and shopping

On average, three quarters of growth comes from people predisposed to choose a specific brand. Ensure brand recognition at point-of-purchase to trigger pre-existing positive associations among the predisposed. Ensure point-of-purchase content triggers perceptions of immediate relevance and conveys the brand’s meaningful difference to boost conversion. Use price promotion strategically to drive penetration and satisfy retail partners, but do not rely on it to drive volume, otherwise consumers will come to expect deals and perceived value and margins will be undermined.?

10) Continue to innovate or risk disruption

Stay true to the brand’s origins and purpose while adding real value for the brand’s primary target audience. Stay alert for changes in consumer needs and context that create new opportunities, or which might create the need for revitalization. Ensure that all types of innovation add incremental sales: new users, new occasions, new value, or new premium. Do not fragment the brand with meaningless variants and line extensions.