What is the secret to creating more meaningful relationships with consumers and experiencing significantly higher growth as a result? According to a recent Stengel Study of Business Growth, the answer is no more complicated than this: develop a strong brand promise.
Using Milward Brown's Optimor technique (explained in the box at the end of this discussion), the Stengel analysis was performed over a ten-year period spanning 31 countries and 28 categories. The top 50 brands--that is, those that outpaced their competition in brand value over the past decade and formed “unusually strong connections with consumers” are listed alphabetically in the following chart. The so-called the ‘Stengel 50’ grew three times faster in financial terms during the period studied than their competitors and the overall universe of brands.
The Stengel 50 reveals quite a disparity in brand categories, ranging from luxury brands like Hermès, Louis Vuitton, Moët et Chandon, Hennessy and Mercedes-Benz to e-commerce brands like Amazon.com and Zappos to consumer goods brands like Coca-Cola, Sensodyne, and Red Bull. Among these brands we see some of the usual suspects, ones that have been identified in other analyses, particularly engagementdb's social media engagement study of the top global brands (which compared Business Week's top 100 global brands according to number of channels and depth of engagement), as well as assessments of company's performance on Facebook and Twitter. Albeit with differences. For example, the top three brands that emerged from the engagementdb analysis were Starbucks, Dell, and eBay. The top three Stengel brands were Apple, Google and Pampers, growing as much as 10 times faster than average company growth between 2001 to 2011. Both studies found that connecting with consumers was associated with financial growth.
Looking a little more closely at the Stengel study, however, the basic question is what exactly does it mean to 'develop a strong brand promise' or identity? Insight into this question is provided by the study's director, Jim Stengel, former CMO of P&G. According to Stengel the high ranking brands were built around a central ideal that clarified their core purpose, such as IBM's goal to 'create a smarter planet' and Jack Daniel's 'maverick independence.' In marketing jargon we call these central ideals 'brand essence' - the essential and intrinsic nature of the brand; its spirit and soul; a single thought that captures that soul.
The man behind the research – high profile US marketer and former CMO of Procter & Gamble, Jim Stengel – suggested all of the high ranking brands were built around a central ‘ideal’ that fostered a tight focus on their core purpose. As described in his book Grow. How Ideals Power Growth and Profit at the World's Greatest Companies, Stengel elaborates on brand ideals:
“A brand ideal is not social responsibility or altruism but a programme for profit and growth based on improving people’s lives.”
“Maximum growth and high ideals are not incompatible. They’re inseparable.”
As an example, Stengel points to Pampers, a brand that lost sight of its core ideal by focusing too narrowly on the dryness of diapers. Market share continued to drop until Pampers successfully redefined its brand ideal as ‘helping mothers care for their babies’ and toddlers’ healthy, happy development’. Anybody can talk about dry diapers, but helping mothers care for their newborns is a message that helps distinguish a winning brand from the also-rans. The best-performing businesses, according to Stengel, are driven by ideals that touch on one of five human values: eliciting joy, enabling connection, inspiring exploration, evoking pride or having an impact on society.