This is not a piece about the latest technological advances, gimmicks toys or 5G, 8K, robotics, foldables, AI and other buzz words. It’s about preparing your business to compete in 2020 and beyond!
So what will be the big branding shifts in Malaysia in 2020? Here are ten developments that will help you take your company from innocuous business to sustainable brand:
1) Seismic shift away from using traditional media to create instant sales to relationship branding to ensure long term success: In 2014, in a global attempt to unseat Apple at the head of the consumer electronics table, Samsung spent a heart stopping RM50 billion, yes RM50 billion on marketing with a large chunk of it on advertising. It failed.
For twenty years Proton spent in the region of RM10 – RM25 million annually on traditional creative driven marketing. During that period, Proton’s market share fell from 85% to 16% and it had to be bailed out by the Chinese.
In 2018, Unilever slashed RM1.2 billion dollars from it’s annual marketing budget. The impact on sales? Zero.
And then there’s Malaysia Airlines. In the lead up to the tragic events of 2014, Malaysia Airlines spent over RM1 billion on traditional media telling us about Malaysian Hospitality. In fact it is still using hospitality to sell seats but lost nearly RM800 million in 2018.
Everywhere you look, businesses that have spent hundreds of millions of dollars on a traditional, creative driven approach to marketing are struggling to stay competitive, repeatedly bailed out by the government or have already gone out of business.
In 2020, the old rules of marketing will no longer apply. Replaced instead by relationship branding. Relationship branding focusses the organisation on establishing a personal relationship at every touch point with every customer, all the time.
Based around a business with a deep understanding of the organisations’ abilities (and limitations), relationship branding will seek to build deep, meaningful relationship with prospects and customers by delivering outstanding individual value and memorable experiences at every touch point throughout the customer journey and beyond.
2. Co-creation is the new innovation: Fusionbrand, one of Malaysia’s most established and respected brand consultancies is working with a local fashion house to build a community around it’s best customers. Each customer is encouraged to participate in the design process by voting for designs online.
Designs that ‘win’ will be developed and marketed in the same way as designs developed in house. This simple but effective example of co-creation will help build relationships with prospects and customers while encouraging participation in the success of the brand and at the same time, generate discussions that will be far more effective than traditional advertising.
This more collaborative and transparent approach to branding is nothing new but it’s rarely done properly. Yet ask yourself, if you are in a positive, fulfilling relationship, where your partner treats you as a partner, are you likely to end it? Of course not. In 2020, successful businesses will look to build relationships not sell products.
3. Develop social media strategies to leverage its power, not treat is as a tactical after thought: 2018 was the year Malaysians finally understood the power of the internet and in particular, consumer generated media (CGM) when they used it to peacefully topple an authoritarian government that had ruled for more than 60 years.
In 2019 Malaysians experimented further by repeatedly challenging the newly elected government while flexing their muscle on numerous issues such as the economy, education, immigration, transportation and taxes.
The taxi industry, utilities providers and other monopolies incurred the wrath of the increasingly confident Malaysian consumer. They and many others are under increasing pressure to perform and will come under further pressure throughout the year.
One Malaysian property developer saw its reputation practically destroyed because of the power of social media and more importantly, its inability to represent its brand effectively online in a crisis.
2020 is barely a week old and social media has already contributed to the downfall of a minister. As the year unfolds, Malaysians will use social media to vent their fury on any business that treats them like fools.
This provides an outstanding opportunity for businesses that understand social media and how to develop a strategy to leverage its power. To do so, firms will need to be more genuine, authentic, accessible, transparent and human. One way to do this is by creating and managing online communities where customers interact with each other, often to the detriment of the brand. Attributes that don’t come easy to Malaysian CEOs but they really don’t have a choice.
The irony is that such transparency and collaborative approach is beneficial to the brand. The Ogilvy Loyalty Index found that such customers are worth six times the value of a “typical” customer while a McKinsey study found that these customers accounted for two-thirds of online sales.
4. Enhanced customer connectivity: With consumers increasingly choosing to shut out the more than 5,000 messages they receive every day, companies must accept that they need to look for more innovative ways to engage with and stay connected to customers if they are to stay ahead of the competition in 2020 and beyond.
The good news is that consumers are more willing than ever to share information and this, coupled with the increasing affordability of tools that provide better capabilities for segmented messaging mean there is no longer the ‘no budget la’ excuse for not integrating technology into any brand strategy.
Moreover, advances in geolocation collection and activity-tracking, mean that companies can provide personalised, custom content and offerings as well as anticipate needs and potentially prevent potential issues at a fraction of the cost of even 5 years ago.
A word of warning though. Enhanced connectivity means more interactions so personnel need to know how to represent the company and what tone of voice to use. Marketing automation and chatbots are not a solution on their own. It’s how you use them that matters.
5. Social branding: Increasingly, companies will understand that brands have social as well as economic value. This is a lesson that companies such as the Body Shop, Patagonia and Ben & Jerry’s have long recognized. Think #MeToo, Black Lives Matter and Movember for examples.
In 2020, companies will increase sponsorships of a wider variety of social movements. Sights like RankABrand are sharing information on how sustainable brands are. Expect Malaysian companies to pay greater attention to corporate governance, recognizing the strong effect that transgressions can have on their brands.
6. Product placement will not go away: As advertising becomes less effective, better enforcement of the PDPA act, do-not-call lists and more robust spam filters, companies will have to work smarter to get their products in front of consumers. Look for an expanded emphasis this year on product placement, not only in TV and movies but also in songs.
7. Blogs will get the recognition they deserve in 2020: Blogs are hardly new but they aren’t used properly in Malaysia or rather they weren’t up until 2018 when they helped bring down the government. An online tool powerful enough to help influence and change the voting habits of Malaysians while making obscure Swedish gamers international superstars and multi millionaires will be used extensively in 2020 to move product.
While there are many bloggers in Malaysia, not many of them are consistent. In 2020, we’ll see blogs begin their rise as a cost effective tool for internal and external community relationship builders.
Smart brands will recognise the power of good blogs such as syedoutsidethebox, Bangsarbabe and of course this one! The power of Blogs to fuel word-of-mouth, which accounts for 30-50% of all brand switching will be truly recognised.
8. Training and upskilling: 2020 will be a tough year economically, making competition even more intense. Moreover, international brands are now targetting Malaysia making it harder to find talent willing to join Malaysian businesses.
This means Malaysian companies will have to invest more in their personnel, treating them as an investment not a cost.
9. Brand audits will become fashionable: In 2020 smart companies will invest in hard hitting brand audits that identify what is right (and wrong) with the brand and provide a benchmark for future strategies.
Understanding where is the brand today, providing a clear vision and mission as well as making sure everyone within the organisation understands what is the brand, its values, what is its purpose and what their role is in delivering memorable experiences will be the key to moving from price driven businesses to brands so expect to hear a lot of talk in 2020 about brand audits [LINK].
10. Fast-forward to the end of 2020: Keep an eye on immersive communications. Talked about since 2005 or so, immersive communications has struggled to cut through the noise, mainly because businesses don’t want to make the investment, preferring instead to try and shout louder than everyone else because everyone else is shouting.
Branding is often not about new stuff, it’s about doing the fundamentals better than anyone else. Get that right, while delivering on promises made and you’ll see your brand succeed where others fail in 2020.
If you’d like to learn how to make your business a brand, contact us today