#EndSARS Signals a new Rule for Brand Building — Why Silence isn’t an Option
Brand consulting giants, Wolff Olins conducted a study that resulted in a theory of evolution of brands across 6 eras as branding is considered a natural human activity. It started with the branding of items with marks strictly to signify ownership, then at the turn of the industrial revolution, brands were used by companies and customers to verify quality. Then there was the advertising boom of the late twentieth century where brands began to evoke emotional responses through storytelling. Examples of this in the Nigerian context were Skye Bank’s “I Wish” and Indomie’s “To Me, To You” ads.
The fourth era of brands were built on a sense of belonging. Think of how you were once considered cool if you owned a BlackBerry and you could chat with a community of BBM users. Then later 21st century, strong brands were being built by empowering people to do things, like YouTube and Uber. That marked the era of platform brands. Although these trends have been valid and legitimate on the global scene, they did not 100% mirror the Nigerian industry. Nigerian brands skipped the fourth era of brands and moved to becoming platform brands. Just like global companies, platform brands have been championed by digital technology companies. Paystack empowers your small business to get paid professionally without stress of setting any payment systems up yourself. Branch empowers you to get those small loans that big banks won’t give you. Across all trends as to how brands create and capture value one thing is key: they are informed by the general interests of consumers at that period. Platform brands were built in response to people’s needs to be empowered to achieve great things. The tribe brands were created at the advent of globalisation and the internet, at the time people wanted to belong to something, like BBM users.
The London-based consultancy validly brought to our attention, a new type of brand still at its early stage and growing rapidly, the conscious brand. There has never been this much need for empathy and social consciousness in our world, and this is a trend that cuts across globally. People are getting more and more conscious of the world around them. Racial injustices, gender inequality and homophobia amongst others are hot topics a lot of people have been concerned with, topics that galvanise people into engagement, be it verbal or through actions. It is no coincidence that one of the most successful campaigns in the last decade, if not the most successful, is one created around the conversation of systematic racism, Nike’s Just Do It ad featuring Colin Kaepernick — a campaign that in just a few months, shot the company up by $6 billion in market value. Just like in every other era of brand evolution, today’s brands should be built to respond to the growing concerns, interests and agendas of consumers. To capture value in the long term, the modern day late millennial and gen z consumer requires you to design your value proposition to support that agenda — and be true to it. The newest agenda is simple, social consciousness. With Nigeria’s massive young population, the concern for sensitive issues with our society; most notably gender inequality, ethnic prejudice and corruption is also rapidly increasing, much so that there is tension brewing in different parts of the country. The most recent awakening is to another societal problem which is ageist prejudices (stop rolling your eyes, boomer) against young adults that have resulted in limited opportunities, stereotypes, bias etc. and in this case murder. In case you’re Nigerian and you’ve been living under a rock, there has been mass nationwide protests tagged #EndSARS for over two weeks concerning police brutality, extortion and extrajudicial killings among others against young people. This is an issue that just like many others, have existed in our society for a very long time and young people are more and more starting to engage in the difficult conversations concerning them.
The requirement for brand and social responsibility
For a company to truly label their position in any marketplace as ‘brand’, the customer relationships that company has must truly mirror the qualities found in authentic human-to-human relationships. This very much involves acting in the interests of those customers the brand intends to build relationships with. In today’s case it is police brutality and youth profiling. Also, for ‘brand’ to be profitable in the long-run, there needs to be a current or future sizeable market for it. What this simply means is if the nature of your customer relationships is based on let’s say inclusivity, but it turns out to not be in the interest of a considerable number of potential customers, then considering the fact that branding is a high-risk-high-return game, you will likely lose money faster than you gain. It’s as simple as that. Fortunately an issue like inclusion has gained popularity this 21st century. Given the rising trends in social consciousness among young adults e.g. in the case of gender inequality, a ‘brand’ that has its value proposition built around confronting society is now more than ever a requirement for any company that hopes to build long-term value in the marketplace. One major indicator of this is the rise in populism in businesses, where customers do not just dictate product lines and marketing mix of a company, but also how the company is run and managed. Unlike before, companies now receive backlashes for reports on sexual violations on employees, hostile work environments, fraudulent activities and so many other negative working cultures that have little to nothing to do with their products and services. There’s a sudden shift in the balance of power between the company and the customer. Never have consumers had so much power over companies as much as they have today. It’s easy to make the mistake of seeing this in the context of mere corporate social responsibility but unlike CSR, the need for companies to be socially responsible is no longer just driven by quotas instilled by corporate law, it is now driven by consumer demand. Social consciousness is also beyond just a marketing campaign you can use to create buzz in the short-term. Make no mistake about Nike’s case, the Colin Kaepernick ad was built on the foundation of a strong reputation the company has with African Americans.
The business of social responsibility
The challenge managers mostly have with brand management is the subjectivity of its outcomes. Unlike short-term marketing tactics, there are no hard metrics to easily justify returns on investments. Outcomes attributable to brand building are not clearly represented in financial statements particularly cash-flow and income statements because those statements account for transactions made over the short-term. Branding results in long-term economic value so for you to best examine the performance of your brand, you have to start from transactions over a longer period of time e.g. over the course of five years. In fact, to really understand the current strength of your company’s brand in a business context, you need to look at your balance sheet. A balance sheets will give detail on the value of your company’s intangible assets which include brand. High value assets are usually a function of accumulated retained earnings and equity. Something as vague and subjective as social consciousness won’t be reported as tangible economic value but the result of changes in customer behaviour that come from a socially conscious value proposition which comes in the form of price premiums, customer loyalty, increased market share and others, are what get captured as economic value. It is for this very reason that brand value maintains a steady, organic growth rate as I’ve shown in the chart below.
Tweeting #EndSARS today and supporting a peaceful protest might not make you money immediately but it’s a good start to a long-term commitment to confronting society’s shortcomings that will pay you in this new era. I’m saying if you’ve always been concerned about what the costs of being socially responsible would do to your bottom-line, now is the best time for you to actually take a stand and also make profits. So you may want to rethink your silence. In the illustration below you can see how brands achieve steady long-term growth through effective brand building in contrast with how one-time marketing activation like giveaways only creates short-term incremental value.
So how do we create socially conscious brands?
Creating a socially conscious brand takes an integrated approach that can go beyond showing empathy in communications. The rules for creating a socially conscious brand is still the same for any type of brand; design your entire value proposition around the interests of your audience. At ATO, we look at a brand holistically in terms of five human characteristics which are represented by certain key areas of a company. This is based on my statement earlier on this article that for a company to label their position in any market place as a brand, the relationship that company has with its customers must be modelled after human-to-human relationships because branding is as emotional as much as it is strategic. So for easy understanding, think of it in the context of five qualities you will likely seek out in a partner. The five qualities are; presentation, expression, competencies, personality and aspirations. These five qualities represent five key areas of the company’s business.
Your presentation is represented in your corporate identity. Your identity constitutes the sensory elements that identify your company as unique. Your identity is responsible for creating a unique first impression on your customers. Results of presentation are dominated by perception metrics like preference and salience because presentation mostly sells the brand early in the buying process.
Expression is represented in communications — the activities dedicated to managing and orchestrating internal and external communications, and the language and tone in which they communicate with the audience. How you foster communication, or how you express yourself as a brand should be effective and meaningful to the kind of customers you intend to build relationships with.
Competence is reflected in product and service lines, and how those products and services are in this case, created around the social interests of your customer. The customer is asking “are you competent enough to maintain this relationship?” This is where the big winners mostly emerge because the results of having products and services that directly or indirectly addresses society go straight to the bottom-line.
Personality is represented in terms of the kind of culture and values the company upholds, and how the company attracts the best talent and influences the workforce into action. Strong brands are built by great teams.
Aspirations in human terms basically answers the question “what are your plans for our future?” The brand’s aspirations are reflected on the company’s strategy and how it benefits the customer going forward. This ensures that the brand is being built on an efficient model that benefits both the business and the customer.
These five components of brand value make up the strength of a company’s relationships with customers. A company may focus on one or optimize all five as long as it satisfies the interests of the customer. To reduce risk and ensure results are positive, prototyping is key. Because these components are subjective on their own, assigning metrics to them helps bring objectivity to your expected results. So for example if you want to test the effectiveness of your workplace culture as to personality, you may choose to track employee engagement scores or employee turnover rates. Assigning these metrics and connecting them to company KPIs is key. It keeps your brand in alignment with your business as a whole.
How companies have captured value by being socially conscious
Some companies have risen up to the challenge to build socially responsible brands in practice which we can learn from. In these brands, you can see a combination of one or more of the five components of brand value in use.
Like I’ve earlier mentioned, Nike’s 2018 ‘Just Do It’ ad featuring Colin Kaepernick is one great example of using a compelling message to show solidarity to a cause. They put a bet on their core millennial and gen z audience who as I’ve also mentioned already in this article, want brands to be socially conscious. Nike also went further to pledge $40million to support black communities. According to an article by Fast Company Nike’s stock price hit an all-time high the weekend after the ad, their online sales grew by 31% and the company claimed $163 million in earned media. This is all in addition to a $6 billion increase in enterprise value.
Over a longer period, Netflix is one company that has reaped big from a socially responsible value proposition, which is cultural representation. As seen with Nollywood movies all over their platform, Netflix airs content from various cultures all over the world, giving a voice to misrepresented minority groups. A much needed answer to the problem of inclusion in the media, one that has paid off hugely for Netflix. This is something they have adopted into their product and their strategy. The thing is, Netflix has as much great shows and movies as they have terrible ones. They could have decided to filter their content to feature only award-winning shows like HBO does and rack up intellectual property but they didn’t. Since 2015, Netflix has increased their shareholder value by about 240% and their revenue by about 200%. Most of this revenue was contributed by the international streaming division. International streaming subscription revenues were the fastest growing segment in the past 4 years, adding $8.4 billion (67% of Netflix’s total revenue increase). In the same period, Netflix has moved up 303 spots from #376 to #73 in the Global 500 league table for the 500 most valuable global brands released annually by BrandFinance, a valuation consultancy that crafted the first internationally recognised standards on brand valuation and evaluation. On Interbrand’s best global brands 2020 league tables, Netflix had a 41% growth in brand value, after only Amazon, Microsoft and Spotify. According to Forbes annual list of most valuable global brands, Netflix claimed the highest growth of 71% and in BrandZ’s list, the fifth highest increase of 34%. These are four global brand valuators infamously known for their extremely differing opinions on brand valuations so it is worth noting their agreement on the growth of the Netflix brand.
If we’re talking about young people having opportunities in the workplace in Nigeria, fintechs have done a great job creating an ideal, flexible work environment for young people. What fintech companies have done about profiling in the workplace is they have used personality, in business terms their workplace culture to address it. Young people are no longer getting rejected as much as before on the basis of their physical appearance which was as a result of profiling. Now so many young people aspire to work for those companies and it’s paying off. The ability to attract talent by fintechs have helped many of the companies achieve big growth. Just recently we saw a report on TechCrunch, PayStack was getting acquired by Stripe for about $200 million, so far the biggest startup acquisition in Nigeria and Stripe’s biggest acquisition — in just five years of doing business.
In conclusion
Building a socially conscious brand has no one size fits all approach, neither is it a quick scheme to ramp up sales. You may not identify as a social entrepreneur but the world is a different place now. The new world order of B2C business mostly requires you as a company to be socially responsible if you want to build a strong brand in the coming years. Social responsibility isn’t a unique selling proposition, it’s a requirement for all brands in this coming era, just like ads weren’t unique to any company during the advertising boom. Every company that wanted to build a brand had to advertise. The old ways of building brand value will eventually become obsolete. How many times did you see a platform brand like Paystack advertise? They’re not from that era so the rules they play by will be different. Are you ready to subscribe to the new rules of the game?
