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To catch the next wave of growth, patience is key

Sometimes moving too quickly will slow you down in the long run. Making the right decision, not the fast decision is critical when your goal is long-term, sustainable, profitable growth. The wrong fit customer, the big but unprofitable sale, the commitment without the ability to deliver… these are all moments when companies think they are moving fast, but often ultimately end up moving backwards. But when you feel a sense of urgency and opportunity, what is the alternative? Take a deep breath and remember: slow is smooth, smooth is fast.

One of our Six-Point project managers brought a mantra to our company that I love: Slow is smooth, and smooth is fast.

He is a big believer that getting the details right up front, excercising patience, asking the right questions, and listening carefully to the answers will save time and rework down the road.

And he is right.

I’ve been taking that mantra to heart not just in the day-to-day of our projects at Six-Point, but to my own strategy for my business as we ease out of pandemic lock-down, and to my work as an advisor for our clients. Slow is smooth, and smooth is fast.

In the spring of 2020, I felt like there was no time for inaction. Anyone who froze and didn’t act was in jeopardy. Since we couldn’t control the landscape shifting under our feet, just moving forward was the smartest way to go.

In the spring of 2021, I feel differently. I feel like there are major opportunities for growth, but particularly for smart growth, because all growth isn’t created equal. And being ready with the right solutions for the right people at the right time will be the difference between catching that wave and getting either overwhelmed or left behind.

So I have taken the past two months and gone into listening mode. Because slow is smooth, and smooth is fast.

What am I doing during this intentional slow down?

I am reading a lot and I am listening to a lot of podcasts. There are a lot of smart people who are extremely generous with their expertise and insights. I am also connecting with the authors and podcast hosts that I find the most valuable on LinkedIn (and sometimes offline, too) to be able to stay connected and in tune with what they are seeing and talking about.

I am interviewing leaders of successful brands in industries where I feel like my team can create true value. I’ve been having conversations with CEOs, sales directors, and marketing directors, and I am learning a lot about what it feels like on the ground in companies right now.

Our team is collaborating with Bean Group Global to survey business leaders all over the globe to better understand the effects of this acceleration into a hybrid world of both virtual and in-person workforces.

I am speaking less and listening more. And I am becoming much clearer for it.

I know it is tempting to just jump at opportunities, especially after you have either experienced a drought last year, or to keep your head down if you were overwhelmed with unexpected demand. But resist that temptation.

I would invite you to figure out what slowing down looks like for your business and your opportunity. Sometimes, the brave thing to do is to move forward even when you don’t know what tomorrow will bring. But right now, I would argue that truly courageous leaders are practicing discipline.

What might this look like? You might:

  • Start “auditioning” new relationships instead of selling to them.

  • Survey your customers to better understand what has changed in their world.

  • Set up some virtual coffees with key customers and just listen to what their world is like.

  • Talk with the competition. (I know, I know… terrifying! But we have seen some amazing collaborations when small competitors take on the big guys together.)

  • Collaborate with someone else who serves your industry and share insights.

  • Scan the social feeds of your ideal customers and see what they are talking about and doing that is not related to your product or service.

  • Read a lot, and not just about your industry. Find macro trends that you should be aware of and incorporate into your planning.

  • Prioritize with your team. You can’t do everything well, so what are the 1-3 things that are most important to knock out of the park? Allow them to really focus on those.

Now is the time to slow down.

To pick your head up and look down the playing field. To listen closely to your current and future customers. Listen, learn, and pick your best opportunity, not just any opportunity.

And then you will really catch that growth wave at its peak and let it carry you swiftly and smoothly to what’s next.

6 consumer trends impacting growing CPG brands

Most leaders feel overwhelmed by uncertainty right now. The questions CPG brands are asking are big ones, and they have consequences for companies with limited resources who are trying to grow and scale. What from the last year was an aberration? What can and should I count on going forward?

Here are six trends we have identified that CPG brands can and should plan to take action on:

  1. COVID-19 made “buy online, pick up in store” a mainstream option for shoppers, meaning even more purchase decisions are being made on our devices, not at the physical shelf.
  2. At the height of the pandemic, consumers would put up with inconvenience to support small businesses by buying direct. Now their patience is waning.
  3. The rise of remote work means that where consumers are spending their time has changed drastically.
  4. Amazon is becoming even more flooded with both brands and third party sellers, increasing competition.
  5. Consumers are becoming harder to reach, which means the ability to speak directly to your current and prospective customers is more valuable than ever.
  6. Consumers are expecting more from social media content than most brands are delivering, meaning there is opportunity for those that create truly relevant and engaging content.

Read on to learn more about each of these trends and get tips you and your team should use to address them.

Trend #1: More retail purchase decisions are being made online. 

 

THE DATA

  • “Buy online, pick up in store” orders placed online increased 202% in just three months from March to May 2020 (Rakuten Intelligence).
  • It’s not just for the upper-middle class. 29 percent of dollars, orders, and items are coming from consumers earning $25,000-$50,000 annually.
  • New order-for-pick-up activity spans all generations. In fact, Gen Z buyers and seniors are the two groups accounting for the most first-time orders, with each group accounting for 22 percent of the new growth respectively.

WHAT TO DO

  • Since CPG brands previously depended on a strong shelf presence in-store, you now need to translate the same experience to digital environments. Here are some ways to make up for that lost tactile experience:
    • Invest in high-resolution, naturally lit photography that will allow shoppers to zoom in on details.
    • Set a style for primary product images (image quality, lighting, distance from camera, background, size, styling, etc.), and then maintain it consistently across all of your brand’s products.
    • Leverage 360-degree product videos to mimic the in-person, three-dimensional shopping experience.
    • Mix in-use and lifestyle images and video with your product images, too. Don’t rely solely on product descriptions to convey your product’s features and benefits. Help your customer imagine how the product will fit into their life.
    • Take image loading speed into consideration. Your product photography can be “saved for web” after photoshopping to limit file size, without significant effect on image quality.
    • Tailor product descriptions to your primary target customer, ensuring you anticipate what questions they will have, and consider their top priorities when making purchasing decisions in your category. Emphasize keywords most important to that primary target, and build your product information hierarchy in a way that’s consistent with their shopping priorities.

Trend #2: Customers did put up with inconvenience to buy direct from CPG brands before the pandemic. Now they expect more of you.

In addition to more widespread consumer adoption of online shopping methods, more retailers have arrived (albeit a bit late) to the ecommerce party, too. This perfect storm will result in higher expectations for CPG brands in direct sales as well-polished, seamless ecommerce experiences become a shopping norm.

 

THE DATA

  • 19 percent of small businesses began selling products online or shipping to customers for the first time in 2020. (Chase Ink)
  • Large retailers are making it more difficult for brands to be competitive with their direct sales. Digital Commerce 360 notes that the top 100 retailers, minus Amazon, accounted for 74 percent of the new, non-Amazon ecommerce growth in 2020.
  • More competition means increased investment required to move your target customer from awareness to sale. The top spending increases for small businesses in 2020 were shipping, social media and search advertising, and ecommerce platforms.

WHAT TO DO

  • Understand how building direct-to-consumer sales fits into your brand strategy and business plan. If you’ve punted on selling direct-to-consumer through your own website and are unsure if the model makes logistical sense for your brand  — now’s the time to decide.
    • Our Solve for Y Ecommerce Gap Analysis can provide guidance on what it will take your brand to compete in ecommerce. We will dive into everything from shipping costs, to logistics, to SEO, to how (and how much) your competition is advertising.
    • Then, invest accordingly. If CPG brands intend to rely on direct sales as a significant revenue stream, you must invest in tech (platform), creative that aids the sale (web design, product photography, video), and advertising that drives traffic (SEO and search advertising, social media advertising, etc.)
    • Winning a first-time sale is only half of the equation. With ecommerce acquisition now more costly than ever, be sure to have a retention strategy in place to keep customers engaged, happy, and purchasing regularly.

Trend #3: Where consumers are spending their time has changed drastically.

Changes to where and how consumers spend their time means your advertising focus should shift. It also means you could quickly become out of touch with your target customer’s new lifestyle if you aren’t proactive. 

THE DATA

Lifestyle changes, new hobbies, new financial priorities — this is a transitional time for everyone. Your target customer has gone through an evolution that will have lasting effects.

  • Job status and finances are volatile. We’ve still lost 10 million jobs in our country overall. Millions have transitioned jobs, and/or have transitioned to working remotely.
  • The number of people continuing to work remotely could increase three to four times compared to pre-pandemic levels of remote work.(McKinsey & Company).
  • An estimated 9 million Americans relocated between March and October 2020 (National Association of Realtors).

WHAT TO DO

  • Go straight to the source. Interview and survey your existing customers, and plan to do so more frequently than you have in the past.
    • Use email surveys to engage past customers who haven’t made recent purchases. 
    • Capture in-the-moment feedback from your site’s visitors with an intercept survey. 
    • Mix optional survey questions into the checkout process.
    • Follow-up with a survey post-purchase as an opportunity to re-engage the customer in your brand. 
  • Compare pre-pandemic website analytics (2019) to present day analytics.
    • Are you noticing major shifts in visitor location? It’s possible that your customers are moving away from major cities, into suburban and rural areas where you may be able advertise more cost-effectively. 
  • Go through the exercise of mapping the customer journey again.
    • For most, the daily commute has instead been replaced with more screen time, frequenting social media and other digital channels during breaks in the day. How you influence the first stage of the customer journey — brand awareness — will need to shift further towards digital spaces. 
    • Think about all of the decision-making advantages your customer has in-store. If your packaging tells your brand story in a way that immediately resonates with customers, that experience needs to be brought into the ecommerce shopping experience. If consultation from a store associate is an important part of the decision-making process for your product, look to mimic this experience in ecommerce. Cover frequently asked questions through multimedia when possible, limiting reading time for the customer. 

Trend #4: Amazon competition continues to increase exponentially.

Amazon’s 2020 growth (38 percent net growth in North American sales) means sellers will be spending more to jockey for the attention of Amazon shoppers. 

 

THE DATA

  • Amazon currently boasts 2.4 million active sellers, with as many as 1.5 million more expected in 2021. 258,000 have joined in Q1 2021. (Marketplace Pulse)
  • 96 percent of Amazon sellers plan to expand their business in 2021. (Jungle Scout)
  • Amazon advertising dollars increased 47 percent year-over-year, with bidding on popular searches commonly costing $7 or more per click

WHAT TO DO

  • If you’re selling on Amazon, a “set-it-and-forget-it” approach to your product listings won’t get you the results you need anymore. Invest in optimizing copy, images, and videos for your product listings. Build an Amazon Brand Store, making it easier for fans of your products to shop your full product lines. 
  • Tap into video ads, which don’t yet suffer from the same level of cut-throat competition. 
  • Understand which Amazon fulfillment model best fits your goals. All have their drawbacks and positives. If you don’t know the difference between them or haven’t recently reviewed them, you need to. If you don’t know where to start, contact us and we can recommend an expert that can help you.

Trend #5: A direct connection to current and prospective customers is more valuable than ever. 

While Amazon’s Fulfillment-by-Amazon (FBA) model makes it easy for brands to sell more without logistical challenges, it’s still critical to keep a direct throughline to your target audience.

 

THE DATA

  • Tech giants are preparing to roll out new advertising targeting policies that will inhibit brands’ collective ability to target potential customers.
    • Apple’s new policies will allow its users to opt for increased privacy in mobile ad targeting. 
    • Facebook is making its own adjustments to remain compliant with Apple. 
  • FBA is an easy sales model logistically, but as more CPG brands lean on it as a primary ecommerce channel, they’re missing out on useful customer-identifying information Amazon doesn’t share. 
  • As consumers uproot and move across the country, your customer data is likely to quickly become out-of-date. 

WHAT TO DO

  • Maintaining a direct-to-consumer ecommerce strategy, even if not a primary sales driver, can help you build and segment CRM lists.
    • Email marketing keeps your brand top-of-mind and reengages existing customers. 
    • Communicating regularly with existing customers helps to increase their lifetime value to you, and provides access to cheaper revenue vs. costly one-time advertising and acquisition programs.
  • Build “data collection” into your social media content strategy.
    • Focus on building a community of engaged fans. 
    • Poll customers where they’d like to be able to find more of your products. 
    • Run contests and giveaways, building a direct connection with winners you can survey or interview in the future. 
  • Engage influencers.
    • Influencers have a built-in, trusting audience. If you can find influencers that appeal to your target audience, you can shortcut the process of getting in front of them. Find influencers that align with your brand, and begin building partnerships. 
    • Start with a $10,000 budget while you’re still learning what influencer partnerships will work best for your brand. In general, influencer activity shouldn’t dominate your marketing budget — and it doesn’t need to dominate it to add value. 
    • Understand that costly “big names” aren’t the only partners who will get a return on investment. In fact, content posted by “nano influencers” (1,000-10,000 followers) and “micro influencers” (10,000-100,000 followers) gets more engagement.  

seTrend #6: Consumer expectations for relevant and engaging social media content are high. 

Virtually all consumer brands have social media presences, and consumers are spending more time perusing social media than ever before. Still, consumers have indicated that the majority of brands are still missing the mark with their content.

THE DATA

  • 68% of people don’t think brands or companies share interesting content. 

As noted in HootSuite’s Social Trends 2021 report, brands are now counteracting this by paying closer attention to what their customers want. 

WHAT TO DO

  • Begin social listening, the practice of tracking conversations and mentions related to topics relevant to your brand. Brand mentions, relevant hashtags, competitor mentions, industry trends, and keywords will provide you with complementary insights you can’t get from customer surveys and interviews. 
  • Use the insights you glean to make adjustments to your content strategy. 
  • Between social listening and trial-and-error of new content, answer the following questions:
    • How does your brand fit into customers’ lives on social media, and how does that influence your posting frequency? 
    • How can you find creative ways to fit into the conversations customers are having, instead of leading them? 
    • What will “break the wall of indifference” customers have to brand social media?
    • Are you “reading the room” to get timing right before launching campaigns? 
  • Treat social listening as ongoing practice and critical must-have to optimizing your social media results going forward.

CPG Brands: Count on the six trends outlined in this article to continue into the long-term future. Nimbleness is an advantage for second-stage brands over slower-moving, enterprise-level competitors. Lean into that advantage! Adjust now, and capitalize on change as opportunity. If you wait until beyond 2021 to address new consumer preferences, expect to fall behind your savvy competitors.

Answer the questions keeping you up at night.

If the pandemic has brought into question your purpose, your target customer, or your brand strategy altogether, find out if Solve for Y is the right solution for your team.

What the heck is a second-stage company?

The definition of “second stage” in business is a company that has 10-99 employees or $1M to $50M in revenue. But the real hallmarks of second stage are the almost universal growing pains that these companies experience as they scale. We have identified the most common themes and pains that early second-stage and late second-stage companies face, especially when it comes to managing changes in focus, positioning, and branding.

I was first introduced to the term “second-stage” through the Edward Lowe Foundation. But it wasn’t the definition of companies with 10 to 99 employees or $1M to $50M in revenue that caught my attention.

It was the signs, symptoms, and stages they described.

As I read about what second-stage companies face, suddenly the pain I was feeling as a business leader made sense. Maybe I wasn’t just a terrible CEO. These were growing pains…a byproduct of success.

It finally brought into focus that I was applying the same skills and tools that made me successful when we were smaller, without realizing that the size and maturity of my company meant that I needed different skills and different tools in order to have the same success at this new level of complexity.

Over the years working with second stage companies, we have identified two kinds of second-stage companies, early second-stage and late second-stage, both with some unique pain points.

Early Second Stage: A New Emphasis on Scalability

Early second-stage companies are usually owner/founder-led, with between 10-50 employees. In early second stage, there are three areas where major pain abounds.

Delegation

Most early second-stage leaders experience delegation pain on two ends of the spectrum: the stuff they love and the stuff they hate.

For the things they love doing and excel at in the business, they will find it difficult to articulate exactly what is in their heads. In brand and marketing, this often happens when branding comes very naturally to the business owner/founder. They automatically infuse branding best practices and a unique voice or design aesthetic into everything they do. When they delegate it, it all of the sudden “doesn’t look right” or “doesn’t sound right” and fundamentally isn’t as effective, because it isn’t them.

For the things they hate doing and don’t have expertise in, the owner/founder will delegate it too quickly, often to the first person who shows interest and/or aptitude, and with very little direction or oversight. In brand and marketing, the first person who shows interest in managing the website or the social media accounts will get tasked with marketing, and will be given no plan to follow or framework to work within. They are often allowed to do or try whatever they want, and then when it doesn’t work, the owner’s response is: “See, I told you marketing just doesn’t work in our industry.”
The fundamental issue is that, whether it is trying to delegate the things they want to keep or the things they want to avoid, the delegation is not being done clearly and effectively. There is no shared vision of success and no clear understanding of what is off-limits and why.

Engaging Expertise

In early second stage, leaders begin to realize that the company has gotten more complex, and needs specialized expertise in order to solve some of the challenges they are facing.

One of the pains they face in this is that they often won’t exactly know what they are asking for experts to do, or they might ask for the wrong kind of expertise.

One recent experience I had with an early second-stage business owner captured both of these pains simultaneously. This business owner was convinced that she needed a marketing strategy and plan developed to accelerate the companies growth. She was talking to several different providers of these services, and getting a wide range of costs that was confusing. I was trying to help her compare apples-to-apples and discern what might be the right fit mix of services and deliverables for her goals.

After about 20 minutes of conversation, though, I learned that the “expert” she had contracted with to manage her Amazon account was doing a terrible job, and that her sales and brand share on Amazon were in rapid decline. It was clear that even if she invested in marketing, it would be wasted time and money until the Amazon problem was solved. Once we had identified this core issue, I redirected her to a trusted friend at an Amazon brand accelerator.

This business owner was doing everything right in theory, but she simply didn’t know what she should be asking for, how much it should cost, or how she should judge success. And it makes sense. She was an expert in her product, not Amazon or marketing.

At its worst, this pain point hits home when an early second-stage company gets taken in by a great sales team that can’t deliver on its promises. It can be a costly mistake, and also one that then makes the company twice-shy about engaging outside experts in the future.

Advice and recommendations from trusted advisors and peer groups becomes the easiest way to manage this leap from working with generalists to working with experts.

Consistency

Consistency is absolutely essential to building trust, both internally with employees and externally with customers. It is also one of the areas in which early second-stage companies struggle the most.

Early second-stagers are still working on creating and fine-tuning processes. They often don’t have the right people completely in the right seats. The owner/founder is still pulled into the day-to-day even while they are trying to spend more time as visionary and coach for their team.

The result of all of this is a lack of consistency. Internally, employees grow frustrated with the lack of clarity, boundaries, and what might feel to them like “moving targets” as they try to focus their own efforts and perform well. Externally, customers might hear and see mixed messages about what the company’s focus is, or might experience major swings in product or service quality.

Internally, the inconsistencies can be especially difficult to navigate because owner/founders are likely the source of many of them as they navigate the transition from “teammate” to “coach.” It becomes difficult for employees to point out the inconsistencies that they are hearing or observing, either because they are fearful of embarrassing their boss, or because they think that the leader is more aware about it than they are. Inconsistencies can be read as intentional, which further undermines the lack of trust, and can lead to a toxic internal environment.

Externally, the inconsistency is unlikely to cause the kind of turmoil that it does internally. Instead, the symptoms will more likely be stagnant growth, difficult sales, and an ineffective marketing budget. If potential customers aren’t clear about how the brand relates to them and what its value is, they won’t buy.

Takeaways for Early Second Stage

For early second-stage companies, the focus needs to be on:

  • Getting clarity on what success looks like for all stakeholders.
  • Finding trusted advisors to connect you to the right experts at the right time.
  • Identifying and quickly mitigating inconsistency, both internally and externally.

Late Second Stage: Tension between the Past and the Future

Late second-stage companies are usually led by a CEO brought in as a change agent, or a next-generation in a family business, with between 50-100 employees. In late second stage, pain arises from two major areas.

Fear of loss

Whether we are talking about family business or simply an enduring privately held company, the stakes of failure are higher the larger the company gets and the longer it is around. Nobody wants to be the one who puts a long-standing business or brand out of business. Plus at this level, the company is likely a visible and important part of the community or its industry. More people depend on the company as an employer, supplier, or customer. It is firmly part of an ecosystem in a way that a younger company is not.

Also, it is likely that there are stakeholders in the company who have a strong fear of loss around certain elements of the company, the brand, or the customer base. Often, these companies were established for a specific purpose, market, or customer that has shifted over the years. In order to make sure that the company endures for the decades to come, some amount of repositioning and reorganization is needed. This can come in the form of strategic mergers or acquisitions, rebranding, product innovation, or simply new leadership with a new strategic vision for the future.

One of our clients is a family business that was founded with a bookkeeping and record-keeping focus, which gradually and organically evolved over the years into printing capabilities, and then evolved again into developing priority technology that can be used in the fast-growing security market, which was where all of their new customers and opportunities were coming from.

Even though the business case was clear, it became a difficult decision to change the original name of the company and to clearly state this new focus. There were still legacy customers who used some of the original products and services, and who had been with the company since the beginning. The fear of looking ungrateful, or abandoning the past is a real factor for late second-stage companies.

This same fear of loss can show up internally as well, as these companies probably also have employees who have been with the company, sometimes for decades. These loyal employees are often the ones that often resist change, or can lack the skills needed to propel the company forward.

It is also important to understand that late second-stage companies live in a place of constant tension between the past and the future. Even though certain elements of the company or the brand need to change, there are also elements that have made the company successful and that need to be preserved.

Change agents in late second stage companies need to walk into the company humbly and looking for what needs to be preserved as much as what needs to be changed. If you can identify the “DNA” (Do Not Alter”) of a company, it can go a long way to mitigate the fear of loss, and also to make the new growth much more efficient and effective because it is building on a firm foundation of success instead of starting from scratch.

Lack of alignment and communication

Since late second-stage companies are honing in on a clear focus for how the company will scale and compete profitably in its “next generation,” they are becoming more and more strategic and visionary. Late second-stage leaders need to make bold strategic moves, like geographic expansion, vertical integration, opening new markets, acquiring new companies or brands, and forming strategic partnerships.

This kind of visionary leadership coupled with the fear of loss described above can lead to a fundamental lack of alignment. To make matters worse, late second-stage leadership teams find themselves misaligned on two fronts, with a board of directors or ownership group and with the employees they are leading.

The cost of this misalignment is huge. Most often, it means that the visionary leadership that the company needs to survive and thrive in its next stage will be thwarted either from “above” by the board or “below” by the employees. But in both cases, it is both predictable and avoidable.

When we do brand strategy and execution work with late-second stage companies, we know that the process and the communication of that work is even more important than the work itself. We carefully engage all stakeholders (internal and external) in the work from the very beginning and have mapped out clear milestones when more communication and engagement are critical for success.

At the end of the day, leading a late second-stage company is a fundamental exercise in change management. For legacy customers, legacy employees, or a board of directors, the solution is always the same: Create a clear sense of urgency for why change is needed, and then clearly and consistently communicate how and why the change will happen. It is also important to celebrate the successes that the company while the change is in process, which will help to keep the momentum going and reinforce the benefits. We build in these moments as part of the process because we know how critical they are for success.

Often late second-stage leaders know who the champions of change will be and they know who the nay-sayers will be. Usually, the impulse is to engage the champions and avoid or steamroll the naysayers, but all it takes is one or two disgruntled employees or board members who feel like they have been left out of the loop to undermine the brand from the inside out. Instead, we advise working with these factions to find out what is important to them, what they are fearful of, and how we can be respectful of that in the process, even if it doesn’t alter the ultimate vision or outcome.

Takeaways for Late Second Stage

For late second-stage companies, the focus needs to be on:

  • Acknowledge fear of loss and fear of failure as strong barriers to change that must be directly addressed for established and/or family businesses.
  • Identify the “DNA” (Do Not Alter) of the company and brand and use it as a foundation for growth and change.
  • Engage all stakeholders in a change effort early and often, especially if they don’t agree with the change being made.

Wrap up: The Strength of Second Stage

While the pains of second stage are familiar, predictable, and real, so are the strength and resilience of these companies.

Second-stage companies make up 17% of the companies in the U.S., but create 36% of U.S. jobs. They are often dedicated to the local communities where they were founded and are likely to bring growth and economic opportunity to these areas that would not come from enterprise-level organizations.

Second-stage companies are tenacious. They have likely survived more than one economic downturn. They have evolved their products and services as the market has evolved. They are often family businesses with a fierce dedication to their employees.

A client once told me that the definition of second-stage success is better problems. If you are the leader of a second-stage business, yes, you should take a moment to realize that you are not alone in your pain. But you should also realize that these new, “better” problems are also a marker of your success, your hard work, and your growth, not just as a company, but as a leader.

So here’s to better problems!

Brand Purpose: The Competitive Advantage Second-Stage Companies Need to Win 2021

Purposeful second-stage companies are more likely to grow and scale in 2021 and beyond following industry disruption caused by the global COVID-19 pandemic. Research suggests that consumer expectations are changing, and consumers now expect brands to be meaningful problem-solvers. The main advantage that these challenger brands have in common: brand purpose.

In every recession, there is opportunity.

For the goliaths, opportunity means digging into deep pockets and outspending weaker rivals (or purchasing them). For challenger brands, opportunity means outthinking and outpacing the larger, slower, more unfocused competition.

The second-stage challenger brands that will win 2021 (across all industries and markets) have a competitive advantage in common: brand purpose.

Before crunching the numbers on business model adjustments with your leadership team, answer these two questions together:

  1. Why do you exist?
  2. Who are you built to serve?

Use these questions as a compass. In 2021, purposeful second-stage companies will get ahead by taking these actions:

  • Making focused pivots. Purposeful second-stage companies will make nimble business model adjustments informed by “why” and “who,” creating exponential value for their customers – gaining new traction in the marketplace faster than their slow-moving, enterprise-level counterparts. 

  • Following through with brand purpose. These companies understand that purpose in the business model must follow through into branding to yield sustainable, long-term results like market share and brand loyalty. Their brand positioning will resonate with their prioritized (one) primary target customer and communicate their value effectively. 

Purpose-driven organizations pivot more effectively.

“Organizations that know why they exist and who they’re built to serve are uniquely positioned to navigate unprecedented change.”
Deloitte – 2021 Global Marketing Trends: Find Your Focus

Purpose-driven organizations arguably have a stronger competitive advantage now than any other time in our generation. As Deloitte points out in its 2021 report, “why” you exist and “who” you exist to serve ultimately take precedence over “what” you sell during times of economic and cultural transformation.

When “why” and “who” inform every decision you make, your adjustments in times of turbulence are much more likely to be successful. This is really an exercise in alignment. You avoid disconnects between you and your primary target customer, and you don’t lose sight of what sets you apart from the other brands around you jockeying for position.

Keep in mind that your customers do notice the adjustments you make, in real time. Fifty-eight percent of respondents to Deloitte’s study could recall at least one brand that quickly pivoted to better respond to their needs, and eighty-two percent said this led to them doing more business with the brand.

What does brand purpose mean for small businesses?

At Six-Point, we often field the question: how does a small company live out a “big” purpose? The Deloitte study provides a helpful example of purpose being tied to action by Ella’s Kitchen, a mid-sized baby and toddler food brand much smaller than many of its behemoth category competitors.

The Ella’s Kitchen brand purpose:
Create healthy eating habits that will last a lifetime.

How Ella’s Kitchen enacts its brand purpose, beyond selling products:

  • Providing resources to educate parents and givers about healthy eating.

  • Donating products to underserved children around the world.

  • Committing to an ethically sourced supply chain.

It’s not too late to become a purposeful brand.

As The Marketoonist Tom Fishburne points out with the help of a quote by brand strategist Tom Roach, “if being purposeful means doing ads to you, you’re doing it wrong.”

Roach also differentiates between two types of purposeful brands: some brands are “born purposeful,” clear about their purpose at launch, while others are “corporate converts,” re-orienting their businesses around a purpose along the way.

It’s not too late to become a purposeful brand if you’re not there yet. The only prerequisites to becoming a “corporate convert” are authenticity, and a willingness to commit to strategic, long-term work ahead. Injecting more purpose into an existing brand requires substantial change management. It’s also worth the investment.

If your business has purpose that’s getting lost, we can help your leadership team begin the realignment process:

  • Our Build Your Brand Strategy workshop guides leadership teams to begin aligning their business purpose with their branding and marketing decisions.
  • Together, we uncover what’s holding your brand back, prepare you to make smarter decisions with your limited resources, and put an actionable road map into place for building better connections with your target customers.
Customers expect you to solve problems.

In today’s world, consumers look to businesses as problem-solvers, which indicates they’re actively seeking brands with purpose. The pandemic has accelerated this trend.

  • In the Edelman 2021 Trust Barometer, consumers ranked business as the only societal institution that’s both competent AND ethical.
  • 68 percent of consumers also believe CEOs should step in when the government does not fix societal problems.
Customers also expect brands to use their platform to speak up about their values.
  • 66 percent of consumers believe that brands who speak out can facilitate real change, and 67 percent say that brands are effective at increasing awareness of issues when they use their platforms, especially social media (Sprout Social 2019 Brands Get Real report).

These trends aren’t new, but they are growing, and the impact is now felt by brands of all sizes — not just enterprise-level household names. Consider the following:

  • The assertion that consumers only expect the most culturally relevant brands (the likes of Nike, Ben & Jerry’s, and Apple) to further the dialogue on social issues is a misconception. Edelman’s 2019 Trust Barometer found that 53 percent of consumers agree that every brand should get involved in at least one social issue that does not directly impact its business.
  • Brand activism is an opportunity to build long-term brand trust from your market by demonstrating transparency and authenticity. Nine in ten consumers are more likely to give brands who are highly transparent second chances after bad experiences, and 85 percent are more likely to stick with them during crises.
  • Your brand can mitigate risk and still find its voice, reaping the benefits of the opportunity.
  1. Start with issues relevant to your business operations, your employees, and your customers to avoid being met with skepticism.
  2. Take the time to learn which issues are most important to your customers. The Brands Get Real report found that when consumers agree with a brand’s stance, 37 percent will refer that company to their friends and family and 36 percent will buy more from that brand.
  3. Assess each opportunity to speak on social issues before taking action. Harvard Business Review published a helpful three-question framework you should use to determine if you can make an impact on an issue, and if you’ll be aligned with your customers.

Committing to authentic diversity and inclusivity in your marketing and advertising creative will also have similar long-term effects.

  1. Authenticity goes beyond simply “checking a box.” A report by Stackla found that when brands made work that gave dimension to people beyond gender or skin color stereotypes, they were met with a 15 percent rise in consumer perception.
  2. Diverse, inclusive marketing is a long-term commitment. It’s not a one-campaign or even one-year initiative.
  3. Take the time to exhaustively reflect on your creative. The World Federation of Advertisers’ 2020 guide, A marketer’s approach to diversity and inclusion, has examples of the questions change-making leading brands are asking themselves.
  4. Talking the talk (in advertising) is most effective when you’re walking the walk internally, too. Align company culture to the same values you’re going to push out into the marketplace.
Live into and articulate your purpose better than ever before.

The good news is…

If your company has grown beyond start-up phase, you likely have some degree of purpose in your DNA. Most companies don’t make it this far. You’re doing something with purpose.

At this stage, the questions are:

  • Is there a disconnect between your perception of your company’s purpose, and the experience customers have with your brand?
  • Is your purpose omnipresent throughout your operations and culture, or is it siloed to certain departments and leadership roles?
  • Are you getting “credit” with your customers and prospective customers for your purpose and value, or are you a “best kept secret?”
If you are ready to amplify your purpose, and make it a sustainable, long-term strategy, you are ready for our Solve for Y program. In it, we:

  • Align your team, your positioning, and your messaging. 

  • Uncover hidden assets in your existing brand. 

  • Avoid confusion, customer loss, and team frustration by guiding you through proven step-by-step communication and engagement plans. 

The Founder Effect

How does a brand transcend a founder while still keeping their value, perspective, and influence? This is a uniquely “second stage” dilemma. Whether you are talking about the next generation of a family business, a new company that emerges after a merger, or installing a new CEO, the question is essentially the same.

This is a bittersweet article for me to write. At the end of this month, Six-Point’s “founding father,” David Wicks, will be retiring.

We have been preparing for this moment for years, but it still somehow feels like walking off a precipice.

Since we began transition discussions, one of the main questions in my mind wasn’t “how will we replace David” (impossible!). Instead, it has been “how will we keep David’s influence intact?”

Before becoming Six-Point’s chief creative officer, David’s background was an art director and creative director. He has worked for large retail grocery store brands, technical manufacturing brands, as well as international consumer product brands like Guinness. He learned how to design “the hard way” — in the time before desktop publishing — painstakingly pasting-up layouts and hand-illustrating concepts to present to clients. The skill, patience, and creativity that went into his work over his career has made him into the multi-faceted, multi-talented creative thinker he is today.

Marsha Montori (who retired in 2019), David, and I started Six-Point back in 2007, and while Marsha strongly influenced the brand and its personality, David was the one who was most emphatic about what we would be… and what we wouldn’t.

  • We would be irreverent. If there is one thing that David can’t stand, it’s people who take themselves too seriously. For David, the work was important. We weren’t. Any time any of us started getting heated, or cocky, or focused on peripheral issues, David is there with a quiet but pointed remark to bring things back into perspective. 

  • We would be communicators, not artists.. A lot of creative folks think of themselves as artists. The beauty of the work is paramount. For David, all writing and design for an agency should be in service to the message and the strategy. Is this element moving us forward toward our goal? Or is it making things less clear? Or worse, is it doing nothing at all? “Because it looks cool” is never a justification at Six-Point. 

  • We would make the work interesting. Never tell David that a client is boring, or that a project isn’t meaningful. As far as he is concerned, we are the only ones who can make something boring or exciting. Our passion, our curiosity, our creativity…That is what makes great work.

For all enduring brands, there comes a time when a founder needs to step back.

It’s always a precarious time in a brand’s lifecycle. Founders are the creators of the vision and the culture of their company. The brand is often very much in their image. The question of how to keep the success of a brand intact without this driving, central force is one that makes transition fraught with both opportunity and danger.

Six-Point Creative is no different. We have had to be intentional to build these founding principles into the daily rhythm of life at the agency. We infuse them in our onboarding. We tell stories to reinforce them. They also affect our selection of employees, partners, and clients. When you are clear on your values and your promises, you have the opportunity to attract like-minded people and create a virtuous cycle.

Preparing for this transition has allowed us to practice what we preach. Our work is all about making brands less dependent on individuals, clearer, more consistent, and more scalable. We are with companies during once-in-a-lifetime transition points when they need to orchestrate the careful balance between honoring the value of “what got us here” and also step bravely out into unchartered territory without dependence on any single person to bring about the future vision.

And now we are at a transition point ourselves. As we move into a new year, I am confident that David will still be with us in everything we do, just as I am confident that we will take that foundation to new heights.

I think David would agree that Mott the Hoople said it best:

Rejoyce for the king ain’t lost his throne, oh no
He’s still here, you’re not alone.