Growth Algorithm and Brand Thinking Model

Growth is the primary goal of an enterprise, and how to achieve growth is a key issue that most enterprises need to focus on. Starting from these four key words: scenarios, tags, social and circulation, the author has built a brand thinking model and logical framework for us. Let’s take a look at it together.

1. Factors of Growth

There is no doubt that growth is the primary goal of a business. Everything a company does is for growth and revolves around growth, whether it is strategy, branding, or marketing. So how do companies achieve growth, and what elements constitute growth?

I think the first pole of growth is products.

The value and price of the product itself are the primary factors that determine growth. Whether consumers think you are worth buying and how much they are willing to spend on you is one of the first questions that users think of when making a purchasing decision.

The second pole of growth is traffic .

Traffic is essentially customer flow and customer acquisition. Creating content and placing ads on Internet platforms such as Tik Tok, Weibo, and WeChat is a way to gain traffic. Advertising in the four traditional media is also for acquiring traffic, including offline marketing activities, channel promotion, and customer visits. Ultimately, it is all for acquiring traffic.

Only with customer flow can there be transactions and conversions. How companies acquire traffic and how large a user base they get is the second pole of growth.

The average order value of a product multiplied by the number of users acquired by the company is the company's revenue, and these two form the basis for growth.

The third pole of growth is user operation, or brand.

Because branding is essentially about managing users. In the past era of bonuses, companies focused on purchasing traffic. With a steady stream of traffic, it was relatively easy for companies to acquire customers and the cost of acquiring customers was low, so they did not pay much attention to brand building and user operations.

But as the dividends disappear, the cost of acquiring customers becomes increasingly high. So after a company acquires a customer, whether it can keep the customer, turn him or her into a fan and loyal consumer, achieve retention and repeat purchases, and even rely on him or her to attract new customers, becomes the key to marketing.

This not only affects whether the high customer acquisition costs can be spread out, but also determines whether the growth can be sustained.

Finally, the fourth pole of growth is culture.

Whether a corporate brand can keep up with, adapt to, and even lead the development trend of social culture determines the vitality of the enterprise.

Because only when a brand conforms to cultural consumption trends and collective consumption psychology can it break out of its circle and win the recognition of a wide range of consumer groups, achieve fission and diffusion at the social level, and form social popularity. Culture determines whether a company can achieve exponential growth.

So we have a formula for growth.

If a company wants to achieve growth, it must either improve its products and product portfolio to increase the average order value; or expand its reach and scale to increase the number of customers; or enhance user loyalty and manage customer lifetime value; or build the brand into a social culture and spread it out.

Ultimately, there are only a few paths to growth.

As I just said, average order value and number of users constitute the basis of growth, while repurchase coefficient and diffusion index determine the upper limit of growth.

Let me explain the diffusion index here. Originally, I used the term fission index, but after struggling for a long time, I finally changed it to the diffusion index.

The term fission is based on the AARRR model, the consumer behavior chain of customer acquisition-activation-retention-monetization-fission.

But I think the term fission is more technical, mainly referring to the operational methods based on the WeChat platform. The term diffusion and the innovation diffusion theory behind it are more in line with my idea of ​​large-scale imitation and spread of brands at the social and cultural level.

This is my algorithm for growth.

2. How to manage these four variables of growth?

Once we understand the key variables of growth, we will know where to work towards.

Next is the second question: How to do well in these four variables of growth?

The four key words I gave are scene, tag, social and spread.

Growth depends first on product strength.

The value of a product can only be presented in the user's life scenarios and application scenarios. Consumers experience products and feel their functions based on specific scenarios.

Only in specific scenarios can consumers understand what the product means to them and what role it plays in their lives. Therefore, the scenario determines the product's ability to monetize.

Growth also depends on marketing power.

Of course, the marketing I am talking about here refers to marketing in a narrow sense, that is, promotion and customer acquisition. For a consumer, whether he will become your customer depends on how he perceives your brand.

The key to cognition is labeling. Labels compress all of a company's complex product and brand information and present it to consumers in a streamlined manner, allowing it to be quickly recognized and spread in consumers' minds, greatly reducing the company's marketing costs. Labels determine the efficiency of user cognition, and thus determine the efficiency of corporate customer acquisition.

Growth once again depends on user operational capabilities.

In recent years, companies have increasingly emphasized community operations and private domain traffic. More and more Internet celebrity brands and new brands that have grown up on Taobao, WeChat, and Douyin have begun to focus on brand building to win customer recognition and loyalty.

The reason has been mentioned before. The bonus has disappeared and the cost of acquiring customers is getting higher and higher, so we need to manage users.

The key to managing users well lies in social interaction. Only when companies build social relationships with consumers can they establish long-term connections. Social networking therefore determines the quality of user operations and the strength of brand relationships.

Growth ultimately depends on social impact.

According to the innovation diffusion theory, a new product, concept, or practice needs to go through a process of dissemination among members of the social system before it can be accepted and adopted by the general public, and it follows a pendulum curve. The diffusion of innovation is a fundamentally social process.

If a company’s products want to spread, become a phenomenal hit, and establish their brand, their weapons are technology and culture. Especially today, the rapid development of the times, the constant changes in consumer groups, and the emergence of various technologies and media have caused a cultural break in society, which has created unprecedented cultural innovation opportunities for brands.

If companies grasp the power of this ideology, they will be able to achieve brand fission and diffusion and win a large consumer group. Circulation determines the extent of social diffusion.

Based on these four themes, we have a standard formula for building a brand.

The thinking model and logical steps for building a brand are to create scenes, label, socialize, and spread the word.

Next, let’s try to explain it in detail.

3. Thinking model and logic for building a brand

1. Create a scene

The word "scene" has become one of the hot words frequently mentioned on the Internet since 2014. But regarding the scene, I feel that there are a few points that are not made clear.

First, what exactly is a scene and how to define it?

Once a word becomes popular, it can easily be abused, and eventually everything becomes a scene. The connotation and extension of the scene cannot be clearly explained. This is language corruption.

Second, what specific role does the scenario play in corporate marketing?

Everyone is talking about scenarios, but no one has returned to the essence of business to think about what role scenarios play in marketing. But only by clarifying this issue can we truly apply scenarios to marketing.

Third, how do companies design consumption scenarios based on their product characteristics and target groups? Are there any common elements, steps and formulas?

It is useless to just talk about the scenario. What is important is how the scenario is developed.

The first question I want to answer is the marketing value of the scene. The greatest marketing value of a scene is that it creates demand. People's needs arise in scenarios. People will have different needs in different scenarios, and scenarios create needs.

In March this year, shared power bank companies collectively raised prices, which was unanimously condemned by the media and consumers. Let’s take a look at the pricing strategy of shared power banks. The average price in business districts and hospitals is 3-4 yuan/hour, in scenic spots and stations it’s 5-9 yuan/hour, and in bars and nightclubs it’s 10 yuan/hour.

Different scenarios have different pricing, and this is fundamentally because consumers have different demands and willingness to pay in different scenarios.

When you are in a bar and there is a member of the opposite sex waiting for you to meet, and your mobile phone is out of battery, would you use a power bank that costs 10 yuan per hour? For consumers, the value of power banks is obviously different in different scenarios.

The value of a scene is to create demand and drive consumers to buy. Therefore, companies need to find the time and occasion that can best stimulate consumer demand and make consumers feel the value of their products.

This is the definition of scenario in the marketing context. Companies should also build scenarios for their own products based on this.

Scene design includes two parts: one is scene experience, the other is scene triggering.

• Experience is on a psychological level, and its purpose is to make consumers feel the value of the product and stimulate demand.
• Triggering is at the behavioral level, and its purpose is to remind consumers to take action and trigger purchasing behavior.

Scene experience includes three levels: sensory, emotional, and meaningful.

First of all, what kind of sensory experience does the product bring to consumers, and how can the value of the product be "visualized" to consumers? That is to say, consumers should be able to see, hear, smell, taste and touch the product's functions and quality.

Feelings are real, and value that can be felt is the true value.

Secondly, what emotions of consumers can the product be associated with, that is, the consumer's mood when consuming the product, whether it is happy, peaceful, confident or assertive.

Finally, it is about what meaning the product brings to consumers, in terms of self-respect and realization, and in terms of group belonging.

Sensation, emotion, and meaning are the three levels of body and mind.

Scenario triggers include four major variables: timing, occasion, action, and frequency.

These variables are all designed to answer how consumers should consume your product, when, where, how and how to consume and use it (consumption actions and frequency).

It's like putting the word "daily" in front of nuts. The “daily” reminder of consumption frequency has created a market worth tens of billions.

In this way, we get a formula for developing a scenario.

A brand is the integration of consumers’ experiences in specific scenarios. Experience the brand, this is the first level of brand thinking.

2. Labeling

Secondly, let’s talk about labels.

If you want consumers to buy your products, you must first tell them who you are, what you do, and how you are different from other similar products. This requires companies to convey information to consumers, including product information and brand information.

How to convey information? For a long time, two major routines have been formed in the advertising industry:

One is the approach of 4A companies: single appeal + integrated communication.

Extract a core concept for the brand, carry out multi-dimensional and three-dimensional creative expression and content output around the concept, and then integrate and output it through various media combinations.

The second is the approach of local marketing companies: brainwash advertising + media bombardment.

Simplify the advertising information into one sentence, such as "sales volume is far ahead" or "shoot wherever you want", and then put it in large quantities through mainstream powerful media (CCTV or Focus Media), repeatedly bombarding consumers' eyes and forcing them to remember.

But the problem is that in today's digital age, both of these approaches are expensive and increasingly inefficient. Because consumers are beginning to take control of information.

In fact, in this age of information explosion, if you think about it, you will know that consumers are not short of information at all. If companies continue to bombard consumers with a large amount of information, it will simply be annoying and frustrating for them.

What consumers really lack is not the ability to obtain information, but the ability to organize and absorb information.

How to make disordered information orderly and how to simplify information. In other words, as Professor Liu Run said in a recent article, the biggest gap between people is no longer information asymmetry, but cognitive asymmetry. Cognitive poverty is a person’s greatest poverty.

So, what is the end of information simplification? It's a label.

Labeling is how we make sense of the world around us, and it’s a survival skill we’ve evolved over millions of years. If a company wants to achieve information symmetry with consumers, it should invest heavily in media advertising. If a company wants to achieve cognitive symmetry with consumers, it should label its brands and consumers.

The greatest marketing value of labels is to help companies lock in the “mental track”.

If a person wants to start a business and build a brand, the first step is to choose a track. For a long time, track has referred to categories. Categories vary in size, so some tracks are wide and long, while others are narrow and short.

If you choose the wrong track, no matter how fast you run, your final result may still be worse than others.

For example, when it comes to convenience foods, snail noodles have now become a big market share in this market, second only to instant noodles, and are unmatched by other rice noodle products.

However, why are some tracks wide and some narrow? Why is the market size of Liuzhou snail noodles much larger than that of Guilin rice noodles, even though they are both in the rice noodle track? Why has the snail noodle market been able to make such rapid progress in recent years, leaping from a street snack to a national food?

In fact, it is not that the product itself has changed, but that consumers’ perception of snail noodles has changed.

The real race is not in the category, but in consumer perception.

The value of labels is to help brands break through the original physical category limitations, find a broad mental track in consumers' cognition, and help brands find first-mover advantages among competitors on the same track and achieve staggered competition.

It's like sparkling water, which is originally a very small track in the beverage market. However, when sparkling water was labeled as "healthy", it immediately broke through the limitations of its original small category and gained broad development prospects. Because health, fitness and bodybuilding are in line with today's consumption trends.

So we see that whether it is sparkling water, sports drinks, tea drinks, coffee, or even cola, they all claim to be “0 sugar, 0 fat, 0 calories”.

This also shows that today's tracks are no longer straight like in the past, with no intersection with each other, but are winding and intersecting with each other.

Consumers’ decision-making logic is no longer “category thinking, brand expression”.

For example, if I want to drink cola, I buy Coca-Cola; if I want to drink orange juice, I choose Orange Juice or Weiquan Daily C; if I want to drink tea, I choose Master Kong Green Tea.

Consumers today are “thinking in scenarios, recognizing labels, and expressing brands”.

• For example, if I am very tired after working overtime today and feel very depressed, I want to drink "fat house happy water", so I decide to buy Coke or milk tea.
• For example, I just finished exercising today and want to drink something healthy, so I can choose Yuanqi Forest, Oriental Leaves, Weiquan Daily C or sugar-free cola according to my preference.
• For example, today I bought some drinks for breakfast and wanted to drink something "nutritious", so I decided to buy milk, juice, or soy milk, etc.

Labels determine a company's market size and user mental capacity, so companies must decide on marketing information, what to say to consumers, and what content to deliver to consumers based on their own designed brand labels.

In an enterprise's information strategy, there are two most important areas.

The first is the brand text , which is the brand’s core appeal, slogan, etc. The core text defines the brand.

The second is the content spectrum , that is, the brand’s content display on content platforms such as Weibo, WeChat, Douyin, Kuaishou, Bilibili, Xiaohongshu, and Zhihu.

However, the content cannot be covered in one sentence. It must be rich and three-dimensional, with various forms such as pictures, long videos, short videos, notes, answers, etc. Moreover, the content must have different information points and entry angles for different types of consumer groups, different seasons and marketing nodes.

Therefore, content can be reflected into a complete and colorful spectrum based on brand labels. I call it the “content spectrum.”

For example, BOSIE, a clothing brand that has grown very rapidly in the past two years, is a designer brand in the traditional sense, and it operates in the same way as fast fashion brands.

But from a mental perspective, BOSIE labels itself as "genderless and ageless".

• "Genderless" can help BOSIE target a variety of male and female consumer groups. It can be worn by couples, girlfriends, and parents and children. Moreover, "genderless" is also in line with today's social culture of gender equality.
• "Ageless" can satisfy the new generation of young people's pursuit of youthfulness, and they hope that their dressing style is full of childlike innocence, campus style, coolness, and neutral consumption characteristics.

The rapid growth of BOSIE is actually based on the mental track locked by these two labels. So let’s take a look at the directions and perspectives of BOSIE’s content marketing (that is, the “content spectrum”).

Companies find their own mental track through the design of brand labels, and then interpret the labels through brand text and content spectrum.

OK, we have a design formula for a label.

What is a brand? In fact, it is the process of labeling in the minds of consumers.

Companies should choose the cognitive label that best suits them, determine the brand’s identity and unique attributes, and thus find their own mental track, making it easier for consumers to know, recognize, and identify with them.

Then, the brand should set the brand text (for advertising and marketing promotion) and determine the content spectrum (for self-media and content creation) based on this core label. Label brand, this is the second level of brand thinking.

3. Be social

Again, social.

To evaluate the quality of a company's user operations, it is not about how much money consumers are willing to spend on the brand, but how much time consumers are willing to spend on the brand.

Are consumers willing to like, comment, and forward your content? Are you willing to participate in your activities? Would you like to watch your live broadcast? Would you like to join your community? Are you willing to speak up for you online and in interpersonal relationships?

If these are not present, then the relationship established between the business and the consumer is just a transactional one, not a social one.

Today, the major Internet giants and various Internet products are competing in the end to see how to dominate users' time and space.

Everyone has only 24 hours in a day. If you use Douyin more, you will naturally have less time on WeChat; if you keep playing Honor of Kings, you will naturally have less time to shop on Taobao.

Some time ago, I read an article titled "The End of the Internet is Content." Tool products including Didi, DingTalk, and Boss Direct Recruitment are all creating content and inviting high-quality content producers to join (I have received many invitations to join from platforms in recent months).

Why does everyone need to create content? Because only content can occupy users' time. If users don’t spend time with you, where will you get the traffic?

Why does Taobao have to do live streaming? That’s because the essence of Taobao lies in “shopping” rather than “buying”. Consumers will have a stronger identification with Taobao, establish stronger connections, and spend more money on it if they spend more time watching live broadcasts on the Taobao platform.

For brands, how can you get users to spend more time with you?

The first is to create content, and the second is to socialize more with consumers and get them involved.

The source of participation is the product. Enterprises should involve consumers in the product research and development, design, production, and online operation stages. This kind of product co-created by users naturally forms a strong connection with users.

Look at Xiaomi. Consumers have been involved since the very beginning of the development of the MIUI system and Xiaomi products, so the power of Mi fans is so great.

There is also NetEase Cloud Music. For a music platform, the core competitiveness is music copyright, right?

NetEase Cloud Music has no advantage in terms of copyright, but the various great comments in NetEase Cloud Music have attracted users, expanded the brand influence, and established competitive barriers.

It can be said that the product NetEase Cloud Music is jointly created by the enterprise and users. So in 2017, NetEase Cloud Music’s music review special train subway advertisement was all over the screen as soon as it went online, becoming a national-level marketing event.

Secondly, brands need to establish empathy with consumers and achieve resonance of discourse during communication.

For toC, the greatest significance of a brand is empathy with consumers; while for toB, the main role of a brand is to provide trust endorsement.

In order to build trust, it is very important to construct a discourse system shared with consumers. Let consumers speak out about the goodness of your product, so that you can establish user reputation. This reputation may further develop into industry standards, become an important basis for consumers in the industry to choose products, and even become public opinion, helping brands build social influence.

Truly good public relations does not involve companies spending money to find the media to publish a bunch of soft articles and press releases, but rather consumers speaking for you. Consumers create content on major platforms to show off your products and give good reviews for your products. In this way, the words created by users will be more real and more touching. Especially when a brand is facing a crisis, good crisis public relations cannot be separated from the support and support of fans.

Finally, as the saying goes, there are no eternal friends, only eternal interests. Only when brands form a community of interests with consumers and share interests with them can they establish a lasting connection with them.

In the past, the main means of corporate marketing was to purchase users from the media, but today, corporate marketing is to purchase users from users.

Why are users willing to join your community, purchase your membership, and become your private traffic?

That’s because you have given people discounts (or shared valuable content with users). There are flash sales every week and membership activities every month in the community. Only such a group will be active and retain users.

Why are users willing to forward your link to their friends and family and help you with fission? That's because you offer discounts, red envelopes, and coupons.

As long as companies are truly willing to spend their time and energy on users, share value and benefits with users, share valuable content and knowledge with them, and invite users to participate in the operation of the brand, users will definitely give you returns that exceed your expectations.

Now we have a social process formula.

I have written this before in my official account:

“Building a brand is actually a process of co-creating with consumers. Enterprises form a community with users on the road of sharing values, resonating with content, communicating, and coexisting with organizations, thus completing the construction of the brand. The brand is the community built by the company's products and its consumers.”

Social branding, this is the third level of brand thinking.

4. Become a popular topic

Finally, spread it.

In order to explain the social diffusion and spread of brands, we must talk about a concept: meme.

It is a concept invented by the famous British evolutionary biologist Richard Dawkins, from his genius book "The Selfish Gene". The English word "meme" is modeled after the word "gene" which means gene. Refers to genes in social culture.

Memes are units of cultural expression such as beliefs and buzzwords, which are replicated and spread in social culture just like the role of genes in biological evolution. Of course genes replicate through inheritance, while memes replicate through imitation.

Gabriel Tarde, one of the three founders of French sociology, used the two factors of invention and imitation to explain all social life phenomena. He believed that human society is a cyclical process of invention, imitation, conflict and adaptation.

Imitation is the most basic social relationship and the ultimate element of social behavior. Society is a group of individuals who imitate each other. Social relationships are basically relationships of imitation.

According to the innovation diffusion curve, how does a new product or brand become popular? In the end, only a small group of people tried the product first, and then the masses imitated it.

So why would the public imitate? Because there are memes. So I personally understand meme as the motivation for imitation, and I understand the English word meme as the copying and transmission of words, ideas and behaviors from one me to another.

Tarde therefore said that imitation is dissemination . The ultimate goal of a company's brand communication is to get consumers to buy and use the product like the characters in the advertisement.

By the way, there are three sentences that have had a profound impact on my understanding and comprehension of mass communication, and have greatly helped me in advertising and brand communication.

The first sentence is what the communication master McLuhan said: "The medium is the message."

The media and technical tools for disseminating information are sometimes more important and meaningful than the information itself. What influences our understanding and thinking habits is often not the information, but the medium that disseminates the information.

The second sentence is what Don Schultz, the father of integrated marketing, said: "Marketing is communication, and communication is marketing."

The so-called 4Ps, namely product, pricing, channel and promotion, are actually all about conveying information to consumers. It is crucial for consumers to receive and understand this information. Consumer communication is all about marketing, and information dissemination is a company's only sustainable competitive advantage.

The third sentence is what Tarde said: "Imitation is dissemination."

The ultimate goal of communication is to make consumers imitate from words to behaviors. Verbal imitation is spreading the brand by word of mouth, and behavioral imitation is consuming and using a certain brand in groups. The mission of social communication is imitation, and the means is memes.

Okay, now let’s put aside the academic definition of “meme” and talk about what can trigger people to spread and imitate in marketing communications.

My point is that all memes in brand communications are responding to the relationship between people and society.

Because humans are born social animals, socializing is human nature. Adler, the founder of individual psychology, believes that the three major issues that must be faced in life are work, social interaction, and gender. In fact, aren’t work relationships and relationships between men and women also social? Therefore, there is only one problem that we must face in life, and that is social relations.

Only when brand communication involves content related to social relations such as how we view ourselves, how we view work and family, how we view gender, love and marriage, how we view the country and the world, can such communication attract the attention and discussion of the general public.

Let me give you an example. When it comes to corporate marketing events and event IPs, one example that must be mentioned is the big IP of American lingerie brand Victoria's Secret: the Victoria's Secret Show. It has been hailed as the world's most dazzling and spectacular fashion show, and also one of the world's most successful marketing campaigns.

The annual Victoria's Secret Fashion Show is unprecedented in its grandeur. Countless celebrities are eager to get an invitation, and nearly a hundred countries around the world broadcast it for free. Thanks to the success of the Victoria's Secret Fashion Show, Victoria's Secret once dominated more than 33% of the US lingerie market. Victoria's Secret sets a perfect standard for what is sexy and the female body.

But since 2013, the Victoria's Secret Fashion Show has been in a terrible state. First, the ratings began to plummet, and finally it was forced to be discontinued in 2019 (you know, the Victoria's Secret Show has been held for 24 years), and even the Victoria's Secret brand was sold at a low price by its parent company L Brand. Because there was really no other way, L Brand's stock price dropped from $100 at its peak to only $20.

Emerging lingerie brands have begun using plus-size models in their advertisements. Lane Bryant, who specializes in plus-size lingerie, even started a topic called "I'm no angel (Victoria's Secret supermodels are called angels)".

Last year, CK used plus-size models in its advertisements to emphasize diverse aesthetics, which became a hot topic around the world.

When it came to China, lingerie brands Neiwai followed suit, also using women of various ages and body proportions for their advertisements, with the message that "no body shape is insignificant", which also attracted a lot of social attention and discussion.

Last year, Victoria's Secret invited Zhou Dongyu to be its spokesperson, and not long ago, it invited Yang Tianzhen and others to participate in launching a brand campaign called "Be Yourself."

Speaking of which, I'm sure you've seen that for underwear brands, memes are "our views on the body." Only this kind of topic involving social relations can arouse the recognition and controversy of the public and form imitation in behavior.

Okay, now let’s give the last spreading mechanism.

Cultural brand, this is the fourth level of brand thinking.

The above formulas are roughly my systematic views on the entire marketing and advertising industries, as well as brand building, marketing promotion, advertising communication, and copywriting planning.

Author: Empty-handed

Source: Empty Hands (ID: firesteal13)