Science-fiction buffs have an easier time taking to a new tool for the care and nurturing of brands: scenario-building. Fans of the genre are used to imagining different possible futures, based on what's happening today and what might happen tomorrow. For the rest of us though, there's more of a learning curve. But the results of a scenario-building project we conducted at Saatchi & Saatchi Advertising on the future of brands in the retail environment make it worthwhile.
Scenario building is a strategic-planning tool which helps us look at change in the present in order to make more informed business decisions. It assumes the future can be shaped by the decisions and actions we take today. Rather than trying to predict a definite future, the technique lets us formulate scenarios based on the realities and uncertainties of the present. Brand strategies can then be formed based on these options -- strategies which can be used in order to act, not merely react.
The crucial dynamic we see is the power relationship between retailer, manufacturer and consumer. From this, three alternative scenarios emerge:
· In the first scenario, retailers become even more powerful than they are today. Store brands challenge the consumer's loyalty to established brands and the store itself becomes the brand. In this world, the in-store environment is the primary arena for marketers and advertisers and the store's image becomes a consideration in the brand's image.
· A second scenario is in the growing power of consumers. With interactive technology, the home becomes the store and the consumer can directly access brands. Two types of advertising will develop once choice and control are in the consumer's hands: teaser ads to invite people to the brand and ads containing personalized information.
· In a third possible scenario, the polarization of America into Haves and Have-Nots continues. The affluent will seek customization; others will buy largely on price. This will be a complex world for brands and advertisers who will be forced into category management: customized brands for the upper tier, value-oriented brands for the lower.
Brand loyalty, already shaky, will be threatened by powerful retailers; consumers with more choices and control; and an eroding mass market, fragmented at both ends. These scenarios suggest the following possible actions:
Corporate identity building A way to increase trust and get consumers to distinguish between brands.
Co-existence Learning how to survive in a world of store brands and the store as a brand instead of a fighting the brand war.
Customization Preparing for the personalization of brands.
In the uncertain and rapidly-changing retail world, scenario building helps you keep one eye on the horizon, and one eye on the next step. It lets us become agents for change, not victims of change for our brands.
Myra Stark is senior vice president and director of knowledge management and consumer insights at Saatchi & Saatchi Advertising, New York.