The ‘Theory of Brand Evolution’ is a five-phase theory that explains how brands might go from zero to hero. It charts how brands evolve from genesis to billion pound turnover and beyond.
The five phases are:
– Extend Land
– Extend Product
Here we use sports performance brands to explain how this is achieved using some of our clients as examples. This is essential reading for any aspirant brand builder.
PHASE 1 – BIRTH
Phase 1 is all about establishing a brand’s meaning.
This comes from one or all of three areas:
a. Product and its creation
b. Behaviour and how it shapes brand character
c. The newness the brand brings to the market
The act of establishing the brand authority within a mature market can take a brand from zero to £10m.
A case in point is Sealskinz – Sealskinz’s authority comes from all of the three areas:
a. The product innovation of world’s first waterproof sock
b. A brand behaviour centred in “Outdoor Defiance”
c. Owning the moment of truth “Cold feet equals a bad day”
The critical characteristic of this phase is that the brand is usually selling a single, specific product for a specific use, to a specific customer.
PHASE 2- NURTURE
Phase 2 is all about commercialisation.
Traction is necessary in three areas:
a. Geographical traction
b. Channel traction
c. Product traction
The energy needed to ensure brand traction is huge. In performance, brands gaining traction within a mature market can take a brand from £10m to £30m.
A case in point is Mountain Force. Mountain Force’s traction exists in all the key areas:
a. A strong alpine presence
b. A laser focus on luxury performance
c. An established presence in super-premium ski channels
The critical characteristic of this phase is that the brand is still focusing on selling a single, specific product for a specific use, to a specific customer. However in this stage growth is being fuelled in the domestic market with third party sales and vertically with online sales
The next two phases are all about extension, the extension of product and land. They can be concurrent or consecutive and either can come before the other.
PHASE 3 – EXTEND LAND
Phase 3 is all about converting the traction in the domestic market into opportunities overseas.
The three areas of focus here are:
a. Reinforcing the domestic market
b. Establishing the international market
c. Turning up the volume on presence
There is still no need to redefine a brand’s meaning at this phase. It should be about making introductions and engendering presence. The land grab in performance brands should take a brand from £30m to north of £100m.
An example of this is Arc’teryx:
a. Arc’teryx has reinforced its dominance in North America
b. It has established a foothold in the international markets
c. It is now turning up the volume on “design supremacy” in those markets
The key characteristic of this phase is that the brand is still focusing on selling a single, specific product for a specific use to a specific customer. However in this stage growth is being fuelled by supplementing domestic success with international success.
PHASE 4 – EXTEND PRODUCT
Phase 4 is all about sharpening the brand’s meaning to enable wider product reach.
There are three areas of focus:
a. Sharpen the brand meaning to broaden its appeal
b. Sharpen the insights into the consumer’s life
c. Broaden the product offer to occupy a broader share of that life
This is the phase where most brands come unstuck. In order to widen their product offer, extend their consumer audience and grow their share, they broaden their brand’s meaning. This is where it usually falls apart! In broadening the brand’s meaning it becomes diluted and weaker.
This phase is all about sharpening a brand’s meaning and then strengthening its product reach. A sharper brand focus with extended reach can take a brand from £100m to a £billion.
Another example of this is Salomon:
a. Salomon focused on being ‘The Mountain Sports Company’
b. Salomon then extended its product reach beyond winter sports equipment and into outdoor apparel and footwear
c. Salomon now generates over half a billion in sales, all year round, in multiple product categories and markets
The critical characteristic of this phase is that the brand is still focusing on selling to a specific customer. However in this stage growth is being supported by domestic and international sales. The critical difference is that the brand is now bringing multiple products to the market. However these products are still for a specific end-use and to a specific customer.
PHASE 5 – STATUS
Phase 5 is all about selling products that convey a status and aspiration beyond their function. Statistics vary but the conventional wisdom is that much of Nike’s products are never used for their prescribed end-use function. Herein lies the route to being a ‘super brand’.
Again there are three areas of focus:
a. Retain a sharp brand meaning and focus
b. Acknowledge that whilst the brand meaning does not shift, its appeal must
c. Brand communication must evolve from a quality-driven delivery to a status-driven delivery
Brand meaning and brand content stay the same but brand communication must now orient around conveying status. Simply put, the brand’s new customer isn’t consuming the product for its end-use design purpose; they are consuming the product because it confers a status on them.
The critical characteristic of this phase is that the brand is still focusing on selling multiple products to multiple customers. Growth is being fuelled by global sales, and the products are being consumed non-specifically as lifestyle products that convey status. A ‘super brand’ will see growth extend way beyond a £billion and into the £billions.
Levi’s is an example of this:
a. Levi’s is the authentic jeans brand
b. Levi’s jeans are worn for everyday use way beyond their original workwear design purpose
c. Levi’s authenticity conveys a “truth” and a “credibility” that elevates their consumers’ status
So there it is, the theory of brand evolution and the five steps to “super brand” status:
– Extend Land
– Extend Product