The data is in, and it is does not look good for CPG brands. According to the latest Prophet Brand Relevance Index™, top CPG brands are losing relevance and losing it fast. While they continue to excel at providing trusted, quality products, they lag far behind brands in other categories on most measures of relevance. Despite the billions they spend on advertising, people see most CPG brands as static and two-dimensional.
It’s a tough message, but the data speaks for itself: Even though brands like BAND-AID, Crest and Cheerios ace measures of trust and reliability, not one makes the top 10, and only nine are in the top 50. (Keurig ranks highest at No. 15.) Plus, of the 10 brands that fell the furthest compared to last year’s ranking, five are once-beloved CPG heavyweights: Quaker, Kashi, Pepsi, Snickers and L’Oréal.
Why Top CPG Brands are Losing Brand Relevance
The truth behind this decline is hidden in plain sight. While CPG brands have been carefully nurtured to deliver consistency and quality, that’s not enough anymore. The brands that are most relevant—which we define as being so in step with people that they can’t imagine living without them–achieve this by moving away from being static entities. The most relevant brands today are actually living brand systems that understand consumers beyond the point of purchase, and re-shape how they feel, look, say, and act according to the context of consumers’ lives.
Encouraging marketers to leap from consistency to relevance isn’t easy. But as we look at each of our four key drivers of relevance – customer obsession, ruthless pragmatism, distinctive inspiration, and pervasive innovation – we see some specific ways CPG brands can make that transition:
While the relevance attribute of “Available where and when I need it” is an area of strength for CPG brands, there’s a risk of over-relying on traditional channels given changing consumer behavior. CPG brands must push availability into digital channels and through new business models to shake up their categories. Amazon Prime is a classic example of how a new business model can significantly alter how consumers shop. But even within CPG, examples abound. Dollar Shave Club rattled many cages with its subscription model. And Huggies diapers partnered with Pandora to create a Baby-Making Station, for instance. The example we like best, though, is Keurig. Both drip and craft coffee require time and patience to brew, and Keurig is teaching customers to demand faster, fresher coffee– bringing them into the K-Cup ecosystem and getting them hooked. It ranks No. 9 for the BRI attribute “I can’t imagine living without” and No. 8 in “Makes my life easier.”
Win Love Through Content and Clever Co-creation
One way we measure customer obsession, an important component of relevance, is by how happy brands make people. Looking at patterns in the data, we see that the companies that create content such as Pixar, Disney and Spotify are the ones that perform the strongest on their ability to bring joy to people. CPG brands can do that, too. Our favorite example is the way Oreo has created all kinds of unexpected fun for its fans through its Wonderfilled video content. Content creation has become paramount to building and sustaining a brand today. But content creation needs to be accompanied with a strong content strategy to maximize its ROI.
Build a Community
Brands with a strong purpose have one thing in common: a strong community who believe in its purpose and live it. This sense of connection and a higher calling makes consumers feel distinctively inspired. Brands that leverage that insight gain relevance exponentially as their tribe expands. Think of how quickly brands like Etsy and Airbnb have grown, fueled by positive interactions not only with the brand itself, but also with broader community members. These brands see themselves as big tents, inspiring people by helping them build connections. But CPG brands can play here too. We admire Pampers, which helps new moms through each stage of pregnancy and motherhood with Pampers Village, a viral community of content and encouragement.
Think Past the Line Extension
CPG brand stewards often focus their investment dollars in incremental product innovations. These are necessary, but not sufficient to remain relevant. Being pervasively innovative requires bolder moves that invite consumers to engage with the brand in new and interesting ways. Look for ideas outside the category from companies like Fitbit, with fitness earphones and smart scales, or LEGO, branching into film. CPG companies can do this, too. Take Coke Freestyle, which brings “unlimited variety” to consumers, better brand engagement, and significantly reduces operating costs. Coke is becoming an intelligent, living brand.
Brands are looking for better ways to grow. Relevance is the answer to unlocking that growth. And the way to deliver brand relevance is to stop thinking about assets as static entities, and start thinking about them as living brand systems, which are able to adapt to new contexts and deliver engaging, hyper-personalized experiences.