Brand marketing innovation theory!

In the previous article "Brand Innovation Theory: Folding the Crowd (1) - From "Market Segmentation" and "Positioning" to "New Community", Brand Ape analyzed the causes of the "new community" from the perspective of the evolution of "market segmentation" and disassembled the "new community" breakthroughs of five brands: lululemon, LEGO, Xiaomi, Aranya, and NIO.

After carefully studying the "new communities" of five brands, I have a different understanding of the "new communities".

1. The soil for the growth of “new communities”

Soil 1: "New Consumer Group" New Atmosphere New Cognition

Don’t ask them “how big is the market segment”, but ask “who are you fighting with” - Brand Flip

In the previous article, Brand Ape believed that the foundation of the "new community" comes from the new consumer group and the "creative power" and "co-construction power" of the new youth.

The change in their consumption perspective is not just about consuming products, but also about searching for a shared identity and sense of belonging.

The new group's desire for communication exceeds their desire for material things; their new understanding of the community is no longer about accumulating connections and mutual benefit, but about true spiritual resonance, identification and belonging.

Without the growth and expansion of new consumer groups, there is no such thing as a "new community".

Soil 2: Competition for “user scenarios” and pressure on marketing costs

"The Internet used to be an era of the Garden of Eden. There were birds and beasts everywhere, and food was everywhere. A large number of people were pouring into the Internet, and it was reasonable to think in terms of traffic in that era. But as traffic became more and more expensive, we had to leave the Garden of Eden. The era when we could just reach out and pick fruit from a tree will never come back." - Luo Zhenyu, "Friends of Time 2018"

Everyone is clearly aware that the market environment and growth logic have been refreshed many times in just three years. What we are facing is no longer the "disappearing dividends" or the competition for the "stock market" in the second half of the Internet, but the new era opened up by digital mobility - the seizure of "user scenarios."

"User scenarios" mean dispersed demands, diverse circles and cultural hybridization, which means reduced exposure utility and greatly increased costs for attracting new users in the subsidy and red envelope wars; it means short-lived peaks and extremely low retention, which means that the approach of first big and then strong is ineffective.

"User scenario" means that time is the most important criterion for judgment. Seizing users is equivalent to seizing their attention and continuously occupying their effective time; it means a zero-sum game of user time.

"User scenario" means that in constant frustration and pressure, in active and passive pursuit, brands that continue to create new value for users can quickly spread.

It is not difficult to understand why models such as small and beautiful, efficiency evolution, digitalization, and ecological expansion have become mainstream, and marketing methods such as cross-circle, private domain, content, membership, social, and curation have come up with all kinds of ingenuity. Innovation is everywhere and at all times.

Soil 3: "New Social" under New Connections and New Relationships

The new decentralized and de-authoritative social network that has been in the works for several years has finally taken shape thanks to new connections such as short videos and live broadcasts during the epidemic.

More and more people can connect around any point at any time, take actions on their own, and form a large number of wild relationships; a large number of online social tools and offline activities facilitate new daily social interactions, and new moderate and weak connections are expanding rapidly.

The costs of collaboration and innovation in new social networks have been reduced, and "new communities" based on interests and connections have gradually formed, truly becoming a new experience and new scenario in life.

With the interaction between "new consumer groups", "user scenarios" and "new social networking", managing users and community marketing may be one of the core methods for new consumer brands to break through; it may also be the moat of new consumer brands, the only way to resist the possible swallowing or clearance of giants.

Without building a community, there will be no business to do in the future! ——Wu Xiaobo

2. “New Community” – The highest level of integration between brands and users

So, what is the “new community”?

Humans have been social animals since ancient times, and they have always been pursuing belonging, whether it is a tribe, religion, country, party, society, or Maslow's sense of belonging.

With the doubling of Generation Z and the Z-Effect, "We all want to be unique, but we want to be unique within our own group; we want to stand out, but we also want to be with our community."

From this perspective, the social marketing that everyone talks about is Community, and Brand Ape believes that the "new community" should be Tribe. In order to better understand the difference between the two, we divide the brand and user relationship into five levels based on the degree of integration.

1. Level 1: No integration - consumer relationship - traffic

Degree of association: There is cognition, but low recognition; there is light connection and weak relationship.

Way of thinking: consumer thinking, traffic thinking, assuming one purchase, using traffic as the evaluation indicator, which is essentially no different from the past where channels were king and high-profile approaches. Traffic thinking treats consumers as targets for attention to be competed for in various ways, rather than partners .

Marketing methods: red envelope subsidies to attract new customers, low-price promotions, brainwashing advertising, etc.

Typical representatives: Luckin Coffee, Pinduoduo, Watsons, Miniso, etc.

2. Level 2: Light Integration - Service Relationship - User

Relevance: High cognition, recognition of the brand’s concept; connection, preference for the brand.

Thinking style: User thinking, focusing on user needs, feelings and experiences, and continuously creating new value for users (good products, good services, and good experiences).

Marketing methods: positioning, hot products, content, seeding, private domain traffic, live streaming e-commerce, fission, etc.

Typical representatives: MANNER Coffee, Ele.me Meituan, NetEase Yanxuan Membership, Haidilao, Hema, etc.

Note: Although these brands have membership mechanisms, the membership threshold is low (paid) and all users are treated equally, not to mention pampering old users. They are not true membership marketing.

3. Level 3, Moderate Integration - Fan Relationship - Membership

Degree of association: Start to pay attention to and track the brand, have stickiness and loyalty; continue to choose the brand in the absence of new attraction/stimulation.

Way of thinking: manage users and value members; from managing 1,000 users to focusing on one user and selling 1,000 times.

Marketing methods: membership marketing, paid membership, WeChat group marketing, micro-business, etc.

Typical representatives: Amazon prime, Costco, Heytea, JD plus, Alibaba 88, etc.

Note: Although many brands claim to be engaging in community marketing and establishing WeChat groups/offline activity groups, etc., the essence is still a membership relationship, and the core is sales.

4. Level 4: High Integration – Close Partnership – Community

Degree of association: Identify with the brand and actively spread the word; willing to participate in brand activities and purchase brand derivatives, will not easily change brand habits, trust the brand and have a certain sense of belonging.

Way of thinking: operate the community and let them participate in brand building.

Marketing methods: super users, interactive marketing, KOC, co-creation of content, sense of participation, etc.

Typical representatives: Starbucks, Sandunban, Fan Deng Reading, Tsutaya Bookstore, Airbnb, Xiaomi, and Bilibili.

Note: For brands that engage in community marketing, product sales are not the core indicator. The key is whether they can provide culture, value and meaning to members, establish a deep alliance with users, and continuously increase the value of the relationship.

5. Level 5, Integration - Peer Relationship - "New Community" (Tribe)

Degree of association: Trust the brand, be willing to speak up for the brand, and actively participate in brand and community building; form a community with the brand and have a strong sense of belonging.

Way of thinking: "Gather a group of people to do one thing and grow together with the members."

Marketing methods: circle marketing, sharing power, building communities together, etc.

Typical representatives: Harley-Davidson, Lego, lululemon, NIO, Aranya, and Chaos University.

Note: Tribe "new community" means "gathering a group of people to do one thing", while Community means "you push or guide a group of people to do one thing".

In fact, as a new consumer brand, you can choose to enter the market at any level, whether it is purchasing traffic red envelopes to lure the enemy, or stratifying private communities with members; whether it is co-creation of interactive marketing content, or breaking through circles to build communities...; finding the method that best suits your abilities and resources may lead to various forms of breakthrough paths.

If you start from the perspective of Tribe, the "new community", the best question is not "how big is the market" but "who are you walking with".

What you need to do is multiply rather than differentiate, find your peers (small circles), and fold them together through new technologies, new scenarios, and new social interactions. In simple terms, it means "gathering people of the same kind to do one thing", and a more sophisticated way of saying it is "dimensionality reduction attack" !

Because focusing makes it easier to see the essence, concentration can create more differences, gathering makes it easier to win recognition, and similarities can make you go further. This is a new exploration of an old saying.

However, what exactly is Tribe "new community"?

3. Copy homework and learn how to build a "new community" from "religion" and "European private clubs"

What is Tribe "New Community"?

If we take two classic examples in the history of human civilization, "religion" and "European private clubs", as research objects, everything becomes clear.

1. Religion - Faith-based "Community"

The history of the community can be traced back to clan tribes, but the only religions that have survived to this day are Christianity, Buddhism, and Islam.

Apart from myths and legends, the history of religion is generally divided into three stages:

First, the founder puts forward a theory or an idea. This theory and viewpoint must help a group of people survive and grow (or explain some confusion, or give some hope, or find the meaning of existence, or change life). Under this theory, people are attracted to gather together.

Secondly, create beliefs together and empower individuals. A group of outstanding believers (core layer) gradually created a clear system in interaction and formed a normative doctrine (unified values ​​and programs). This doctrine helped followers to achieve change - better survival (empowering individuals).

Finally, participation in communication, identification and belonging. With the repeated dissemination of the doctrine and the support of various rituals, the doctrine gradually becomes the common understanding of the participants. Each process of participation is a reinforcement and integration of self-identity. The cohesion and sense of belonging of the believers are spontaneously formed, and the faith-based community is thus strengthened.

In this process, countless efficient methods of building communities and forming a sense of belonging have emerged: idolization, totems and super symbols, rituals, temples, storytelling, etc.

It is important to note that faith-based "communities" do not really solve any practical problems, but rather point out problems, guide the emotions of believers, or provide solutions to create and change on their own.

In modern business, the success theories of the early years and the current Luo Zhenyu and Wu Xiaobo all have the flavor of a faith-based "community".

2. European Private Clubs – Interconnected “Communities”

"Community emerges when a group of people with a common interest begin to interact to promote that interest." - Jane McGonigal, "Games Change the World"

In 17th century Europe, the nobility disdained to associate with commoners but needed closer social interaction and connections, so they organized various types of aristocratic salon gatherings, which gradually evolved into places for connecting circles, until exclusive closed private clubs were established, namely aristocratic membership clubs.

The core of private clubs of that era was "connection" , connecting people of the same kind, connecting relationships, connecting information, and connecting businesses; later it came to represent a kind of identity and enjoying certain privileges, and it could also be about connecting circles, connecting lives, and connecting status.

The most representative ones are the White's Club founded in 1693; the Oxford and Cambridge Club, the "Temple of Wisdom" in 1830; the American Bohemian Club in 1872; and the East India Club founded in 1849. Of course, there is also the Freemasonry, which is said to be the largest mysterious membership club and the greatest society in the world, founded in 1717.

To summarize, the European private club-style community building is roughly a three-stage structure:

First, build a community together, share power, and serve members.

Private membership clubs are generally jointly established by several founders in order to better connect circles. The initial members participate in the creation of the community together, and power is naturally shared.

Most of these clubs are not open to the public. Membership usually requires recommendation from existing members and strict review by the committee. Members also have to pay annual membership fees. Therefore, providing exclusive services to members is a basic obligation of such communities.

Second, differentiation and connection, the formation of common values.

"Differentiation" is very important to the aristocratic club. In fact, humans need differentiation, just as we need to find ways to transcend differentiation. Without boundaries, there is no sense of security.

First, there is segmentation based on interests and benefits, such as the Oxford and Cambridge Club, the "temple of wisdom" that gathers people with high IQs, the East India Club that is keen on making money, and the American Explorers Club that loves adventure.

During development, a large number of people with the same values ​​gathered together, and the values ​​of single independent individuals were recognized and strengthened in the group. In the continuous upgrading process, the common values ​​of the aristocratic club were formed - "supporting something".

Finally, more and more people who agree with this concept come together - find similar people and form differences based on values, making the connections richer and the cohesion constantly upgraded.

Third, do meaningful things together

Because "supporting something" requires members to participate in all aspects, whether for hobbies, to make money together, to enrich their lives, or to change the world. In this way of acting together with their peers, they empower each other, grow together, and keep pace with the times.

For new businesses, the process of creating an interconnected "community" is very worthy of reference: joint initiation, unified values ​​and noble causes, thresholds and privileges, interactive mechanisms to add value to social interaction, and encouragement of creativity and support for innovation.

Comparing faith-based "communities" with interconnected "communities", we can see many differences: for example, in terms of values, faith-based communities are more noble, while interconnected communities are more career-oriented; for example, in terms of empowering members, the former empowers believers spiritually, while the latter focuses on growing together; for example, in terms of members, the former expects everyone to join, while the latter only attracts people with the same values.

However, when you examine the similarities between a 3,000-year-old religion and a 300-year-old aristocratic membership club, it’s not hard to see that there are four core characteristics that are the secret to their longevity:

Empower members to survive and grow (physically, emotionally, spiritually, connected, relationally, beneficially, etc.) – sense of security!

• Consistent and clear values, find similar people - a sense of belonging!
• Share power, build community, grow together—and gain respect!
• Do something meaningful - realize yourself!

Digging deeper, the four core characteristics of these two different "communities" are a perfect representation of the "Maslow's hierarchy of human needs model" : sense of security + belonging + respect + self-actualization.

A person is willing to join a community perhaps because of some need, psychologically and physiologically, spiritually and materially, or perhaps because the community can empower him and give him a sense of security; but the reason he is willing to stay is because he has found like-minded people here and has a sense of belonging; when they act together to do something great, they define themselves here, realize themselves, and truly become a member.

In other words, building a "community" is a good way to achieve "Maslow's needs"; it can even be said that building a "community" itself is a great and noble cause.

Back to the business case above, from the perspective of the relationship between brands and users, with "belonging" as the standard, the growth of those great brands can be traced:

• Founded in 1998, lululemon became the world's third largest sportswear brand after Nike and Adidas in 2020; its directly-operated stores have a sales efficiency of US$17,000 per square meter, second only to Apple, Murphy (American gas station), and Tiffany, ranking fourth in the U.S. retail industry and first in the apparel retail industry.
• LEGO, which faced bankruptcy in 2003, ranked among the top 500 brands in the world in 2018, becoming synonymous with innovation and toys. In the "2021 World's 25 Most Valuable Toy Brands List", LEGO toys easily retained the top spot on the list with US$5.397 billion.
• Weilai, Xiaomi, Aranya...

These brands use "user scenarios" as their entry point and "new communities" as their breakthrough point. This is the power brought by the deepening of the relationship between brands and users, and may also be the core competitiveness and new normal for brands in the next five years.

At this point, the definition of our Tribe "new community" is clear.

4. What is Tribe?

Let’s first take a look at some brand experts’ definition of Tribe “new community”.

• "A community is a group of individuals who care about each other's well-being." - Charles Vogel, The Art of Community Management
• “Community occurs when people come together around important ideas and come together under a single umbrella.” - Seth Godin, Tribe
• "A new social relationship of being "alone" but not "lonely", where one can be independent, have one's own space, and also have like-minded people." - Youth Volunteer

Relying on the "user" concept of some new business leaders.

• “The only purpose of any business activity is to create customers. The most important transformation in today’s enterprises is from “ownership” to partnership, from “individual tasks” to collaboration.” - Peter Drucker, the father of management, “The Practice of Management”
• "Focus on user progress, not competitors and products" ——Clayton Christensen, the father of innovation, "Competing with Luck"
• "We will empower every person and every organization in the world to achieve extraordinary things" - Microsoft CEO Satya Nadella

Combining the characteristics of religion and private clubs and integrating digital mobility, the "new community" of new business may be defined in this way.

"New Community" Tribe - The brand brings together a certain type of people with clear values. They empower each other, connect with each other, build communities together, and act together for a great cause, continuously innovate, and evolve together.

Breaking it down, a “new community” requires at least the following six characteristics:

First, clear values ​​and ideas. Whether it is protecting the environment, creating happiness, or being healthier and changing the world, there must be a common dream for everyone. This value system needs to answer the questions of who I am, how I should act, and what my ideas are.

Second, empower each other. Brands empower their members, change their living conditions and help them become better; members can also empower brands to enable them to develop smoothly, not just to sell goods and make money.

Third, the emphasis is on “connection”. Connecting lives, connecting brands, and connecting members to each other. A community without connections is nothing.

Fourth, share power. The "new community" is not a marketing target but a partner. What the brand needs to do is to support it and help it grow, so it is necessary to share power with members and let them participate in its creation, management, and operation...

Fifth, act in concert. A “new community” is not one that only interacts online; continuous and consistent offline actions are the core. "Weekly active users", "monthly active users" and "annual active users" will be new parameters for a new community.

Sixth, innovation and evolution. The "new community" needs to evolve continuously with the environment and the times, and be able to change with changes in technology and culture.

In the "new community" that meets these six characteristics, users and brands will be deeply integrated, and a sense of identity and belonging will be continuously stimulated. Whether it is "advancing" to break through the circle and form a user ecosystem like Lego and Xiaomi, or "retreating" to survive in the "stock market" and resist being swallowed by giants, it will be easy.

5. Postscript

Five years ago, technology completely dominated marketing, and facing the trend, growth and profit became the only KPIs; three years ago, value differentiation accelerated, and private domain communities and user operation concepts were taking shape; one year ago, resources and desires were reset, the era of scenarios began, and "new communities" of empathy, collusion, and co-construction began to emerge.
This is an era where "it is no longer the company that creates the brand, but the user" , and an era where "the core of brand building is how to empower the users who drive your success" .

For new consumer brands, we need to have a deep understanding of the changes, rethink the value of the brand, and reflect on the relationship between technology, culture and life; we should also put down the funnel and not stuff a person into the funnel to extract profits. Instead, we should hold up the ladder to allow users and brands to continuously connect, merge, and change, and ultimately achieve self-realization in the process.
For new consumer brands, perhaps this is the only way to fly further and higher.

Author: Brand Ape

Source: Brand Ape