What do Apple, Amazon, Marriott, USAA, Chevy and Sabra have in common? They’re in the top tier of “Belonging Brands” in America, according to a global consumer study by IBM iX, IBM’s digital marketing arm. Starting with the insight that technology and cultural influences were eroding people’s sense of belonging, IBM iX set out to understand the drivers of ‘belonging’ to help brands understand what customers are looking for when it comes to more relevant experiences that better create a sense of community, engagement, anticipation and shared values.
The research found that cultivating a sense of belonging has a significant impact on brands. Top Brand Belonging performers (with Apple coming in at #1) grew revenue over six years at three times the rate of lower-performing brands. Top performers also gained market share of up to 10% over a three-year period; increased annual sales 12% more than lower-performing brands; have an 8% higher rate in purchase funnel conversion; and are 9% more likely to be recommended than lower-performing brands.
Kelly, this study paints a bleak picture of isolated people who are digitally connected but emotionally disconnected—and how this presents a business opportunity: “A perfect storm of cultural influences is eroding our sense of belonging. For consumers, this fuels disengagement. For brands, this presents a new opportunity.” Could you elaborate?
We started by just really exploring what does it mean to belong, and we found really universal themes—the notion of feeling accepted and understood and supported and cared for and loved and appreciated and not taken advantage of — all these themes we found universally coming out, while using slightly different words, but essentially it’s a similar theme across the globe.
Once we asked what do you expect from brands, we heard that people expect more from them. They don’t just view it as a transactional relationship. They actually do have higher expectations for brands, and we think that’s the good news here, that brands can take a bigger role in being agents of belonging and helping cultivate it in people’s lives and helping to connect people and helping people fell a part of something bigger. And it’s not just be about the next great product or the next great thing.
Of course, products are a part of it, they’re a piece of the puzzle. A lot of brands are still product-central and it’s scary for them to move outside into the experiential and to the community-based needs that people have. But that’s where the opportunity is. We clearly saw that 40% of what people were looking for from brands had a collective quality or a collective trait to it in some way.
Your 2008 book, The Open Brand, discussed the need for brands to be more transparent and create a real sense of belonging and connection with digital audiences. How has your thinking on this subject evolved since then?
When I started working on The Open Brand in 2006, my ‘eureka moment’ was how all this social and digital technology at our fingertips is going to make brand-building much more of a bottom-up imperative rather than just a top-down ‘here’s who we are’ and screaming from the mountaintop. When the book came out in 2008 it kind of came out with a little bit of a thud, mainly because there was a recession happening, but also because a lot of brands were like, ‘This doesn’t apply to me, this isn’t going to impact me.’
What I missed and didn’t talk enough about was the emotional needs of people in addition to all of this digital connectivity. I also didn’t imagine the impact that technology could have almost in a negative way. We know that it has created more connectivity and more togetherness and more empowerment in ways we never before imagined, but we didn’t imagine that it would create so much distraction and anxiety and loneliness.
So I’ve became really infatuated with making sure that the experiences we’re designing for people are not technology-first or AI-first but really human-first, and that technology is in service to those human needs. The human needs are continuing to evolve in ways that we’ve lost sight of a little bit, as we’ve become so enamored with technology as solutions to problems.
Let’s talk about the top Belonging Brand in your report—Apple, also number one on Interbrand’s Best Global Brands for a different set of criteria. What makes it your top belonging brand?
Apple is ahead of the pack in all the things that we were measuring, and it’s excelling at something we call trustworthy excitement. This idea that a brand has to, obviously, be trusted, reliable, dependable and all those things is foundational. What we found to be new and unexpected is that consumers were now attaching trustworthiness to what they viewed as something exciting in the future, the sense of ‘Am I excited, am I anticipating the future with this brand?’ Apple does an awesome job at that. We had never seen trust connected to future anticipation of excitement in that way.
Apple is really good at enriching everyday life and finding ways to provide shortcuts, simplify our lives, make our lives better—whether that’s through family-sharing or cloud services or a constant influx of new apps or an endless array of things that they’re doing that make little moments every day a little bit better. Their innovation is coming from a place of empathy. They don’t just flood the marketplace with a whole host of new products and variations and versions. They’re so deliberate and their innovations come from a very deep place of empathy and a really deep understanding of people’s needs and not just ‘hey here’s another cool thing.’
Think about what’s happening in retail. This year we’re going to have an unprecedented number of store closings and that’s on top of last year, which saw the highest number of (U.S.) store closings ever, so this year will be even more—about 10,000 stores are closing for a whole host of reasons. Retailers have to think differently about their physical space, and Apple’s done a great job of that. Now, granted, their price point’s high and the size of their product is small, but what they have done is they’ve said we’re not just a box to come and buy other boxes, we’re literally a space that brings people together, that’s teaching them—and that cultivates a sense of belonging.
Consumers find it exciting to go to an Apple store. There are lines to get into their stores, there are lines to get to the Genius Bar. They’ve made it a really cool place and you feel like you’re a part of something. That is one of the key components that makes Apple really unique as a retailer. I encourage other retailers to really think about how they’re programming their physical stores so they’re places that aren’t just selling clothes but places for fashion shows, for example, or other experiences.
There are a lot of automotive brands at the top of your list—like retail, an industry that’s being challenged by changing consumer needs and disruption. What do you see going on there?
I was a little surprised to see the industry score so strongly as it did, but when we started to look under the hood and research it more in-depth, what we learned is that because it’s such a high-consideration purchase for most people the industry has adopted the principles of CRM maybe more aggressively and for a longer period of time than other industries have done. So, for example, the insurance industry has not done that historically until more recently.
The automotive industry has become more invested in understanding consumers and realizing that they have to create a sense of belonging in realizing that somebody’s identity really is in sync with the car that they purchase. I think they are just more advanced in that regard. That said, the industry is challenged and the question is will these car brands be able to stay in this position long-term and can they actually innovate in the right way fast enough? Can they really meet the needs, especially, of younger consumers who are not like traditional car-buyers?
Younger people are going to have multiple transportation solutions as part of their lives. They won’t be so reliant on a car with insurance in the garage and getting to and from work. All automotive companies are racing towards this future, so we’ll see how long they can remain in this position and also be doing it from a place that is aligned with people’s values. That’s what we will be studying and will measure year over year.
How can brands build purpose and a sense of belonging into the customer experience?
A lot of people are talking about purpose and we certainly found that it’s not just about putting in a PowerPoint or on a poster or a platitude that gets shared at the annual meeting, but something that should be really articulated in a clear and tangible way that drives all of the behavior—the communications, the structure of a company, some of the choices it’s going to make strategically.
What a lot of brands need to refresh is making sure their purpose is relevant for today, and does it drive their behaviors as an organization? That’s a starting point. What is the experience you want to your consumers to have with your brand?
The other thing is that sometimes customer experience gets relegated to being a tactical thing that need to be done to functionally improve—’We need to make things faster, we need to make things easier, we need to connect databases, we need to improve customer service’—so experience sometimes gets relegated as more of an executional tactical assignment, but it should be strategic.
It sometimes gets very tightly integrated with brand communications, so sometimes the brand communications team is off doing one thing and the customer experience team is off doing another thing. Those two things should really come together in a much more strategic and integrated way in order to get the experiences you want in the marketplace.
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