Editor’s note: David Myhrer is senior vice president, brand strategy at Morpace Inc., Farmington Hills, Mich. Eric Roach is research director with the Claros Communities team at Morpace Inc. They can be reached at dmyhrer@morpace.com and eroach@morpace.com.
Strong brands are valuable because they create an emotional connection with consumers and often command a price premium. This statement should not come as a surprise to anyone. However there is a recent example that Morpace experienced on how powerful a brand really can be.
Strong brands build trust through their core competency. This makes them more readily extendable, allowing them entry into new products and markets not previously exploited by the brand.
You may have heard that Apple, yes the provider of the iPhone, iWatch, iPad, iPod, iPay and iTunes, is planning to manufacture and sell an electric vehicle by 2020.
We thought it would be interesting to ask the Morpace MyDrivingPower community some questions about this strategy. This panel includes more than 250 consumers around the U.S. who own electric and/or hybrid powertrain vehicles. Given that this panel matches the market that Apple would be targeting with such a vehicle, we thought the results would be representative of the strength of the Apple brand.
Among the more notable highlights of the survey:
- Thirty-four percent of consumers would be “extremely” or “very” likely to purchase a new Apple car.
- Sixty-four percent of consumers would be willing to pay between $30,000 and $50,000 for an Apple electric vehicle in 2020; another 22 percent would be willing to pay more than $50,001.
- The vast majority of consumers expected the design of an Apple electric car to “be better” than other electric vehicles (79 percent).
Additional data gleaned from the survey further indicated that there was a high level of trust in the Apple name. Think about it. These consumers have a very positive view of an electric vehicle manufactured by a company that has never been competitive in the automotive market!
Trust is emotional but it is not irrational. Consumers trust Apple because of its sustained excellence in designing devices and offering services which are attractive and intuitively delivered based on the consumer experience. This trust is the reason consumers grant Apple “license” to continue to venture its brand into new markets.
In this case, Apple, no doubt, benefits from Google’s continued development of a driverless vehicle, paving the way for technology companies in the vehicle space.
In the automotive market, the exterior and interior design of the vehicle is extremely important. Apple’s ability to consistently deliver sleek and attractive designs may leave consumers with little doubt about the brand’s ability to deliver an attractive vehicle design.
Furthermore, given that vehicle infotainment systems are more and more important to consumers, Apple’s brand likely offers some intrinsic value to consumers here as well. Many of the systems developed by traditional auto manufacturers remain plagued by perceived usability challenges which hurt them in the eyes of consumers and vehicle buyers. So is it any wonder that consumers are bullish on Apple’s potential in this marketplace?
The lesson here is that no matter what industry you are in, your brand should be nurtured and actively managed. This requires a keen sense of your brand’s core competency and the drivers of brand trust. What can the consumer rely on your brand to do better than anyone else? Qualitative insights, social listening and regular brand equity tracking are key strategies to actively manage your brand to improve its health and profitability.
How can opportunity space be identified to fuel the future growth of the brand? Answering this question requires the ability to anticipate how today’s core competency can be leveraged and extended, in the light of rapidly changing social and technological trends. It requires making business judgments based on quick yet imperfect information, like that collected through a research community.
Consumers can’t answer the business questions that we so often ask them, as if they were the marketers. We must infer them, connecting the dots. Ideation sessions which suspend disbelief about what is possible can produce insights which can help marketers see potential game-changers not identified through other forms of research.
To thrive, brands must grow. You need to make sure that your brand is being viewed favorably by your current target market and potential future targets, even where your brand does not yet play. Because a brand that is not trusted could be a sign of troubling times ahead – think of the many brands that were once iconic to American consumers that have disappeared, or are on their final legs.