In the world of marketing, few books have had such a significant impact as "How Brands Grow" by Byron Sharp. First published in 2010, this book challenged many traditional marketing beliefs and offered a new perspective based on empirical research. In this article, we will explore the key points of the book, providing entrepreneurs with a practical guide on how to apply these ideas to grow their brands.
The Fundamental Premise
Byron Sharp and his team at the Ehrenberg-Bass Institute for Marketing Science (one of Deep Marketing's scientific sources) conducted extensive research on how brands develop and what drives consumer behavior.
The fundamental premise of the book is that brand growth is primarily driven by acquiring new customers rather than retaining existing ones. This contrasts with the traditional belief that loyalty programs or CRMs are the key to long-term success. Sharp and his team analyzed a vast range of data from different sectors and markets, discovering that successful brands tend to grow by expanding their customer base rather than trying to increase the loyalty of existing customers.
This approach is based on the empirical observation that most consumers are not exclusively loyal to a single brand, but rather purchase from a variety of brands within a category. Therefore, trying to increase the loyalty of existing customers may have a limited impact on overall brand growth.
Another crucial aspect of Sharp's premise is the importance of "mental availability" and "physical availability". Mental availability refers to how easily a consumer can recall a brand when in a purchasing situation. Physical availability, on the other hand, concerns how easily a consumer can find and purchase the product.
Let's dive into the details.
Marketing Myths
Sharp debunks several common marketing myths, including:
- Brand Loyalty: Many marketers believe that consumers are loyal to brands and that the key to growth is increasing this loyalty. However, Sharp demonstrates that most consumers are polygamous in their purchases, choosing from a variety of brands.
- Market Segmentation and Niches: Segmentation is often seen as an essential strategy for reaching specific consumer groups. Sharp argues that, while segmentation can be useful, it is not the key to growth. Successful brands tend to attract a wide range of consumers. They decidedly avoid niches!
- Differentiation: Many believe that brands must clearly differentiate themselves from competitors to succeed. Sharp, however, argues that differentiation is often overrated and that consumers do not perceive great differences between brands.
The Laws of Marketing
Sharp introduces several empirical data-based "laws" that brands should follow to grow. Among the most important:
- The Law of Double Jeopardy: Larger brands not only have more customers, but also more loyal customers. However, loyalty is relative to brand size; smaller brands have fewer customers and less loyalty.
- The Law of Distribution: Physical and mental availability is crucial. Brands must be easily findable and memorable. This means investing in widespread distribution and in communication that keeps the brand in consumers' minds.
- The Law of Penetration: Brand growth is driven by increasing penetration, that is, the number of people who purchase the brand at least once. This requires reaching new consumers, not just retaining existing ones.
Based on these laws, Sharp proposes several practical strategies for growing brands:
- Increase Physical Availability: Ensure that the product is available in as many points of sale as possible. This includes both traditional and online channels.
- Increase Mental Availability: Create advertising campaigns that keep the brand in consumers' minds. This can include the use of distinctive symbols, memorable slogans, and a constant media presence.
- Expand the Customer Base: Focus on acquiring new customers rather than retaining existing ones. This can be done through marketing campaigns targeting a broader audience.
- Simplify the Offer: Avoid complicating the offer with too many product variants. A simple and clear product range helps keep the brand easily recognizable and memorable.
How a Small Business Can Grow with Marketing
For small businesses, the lessons from "How Brands Grow" can be particularly valuable. Here are some practical tips on how to apply these ideas:
Key Takeaways
"How Brands Grow" by Byron Sharp offers a revolutionary vision of marketing, based on empirical research and concrete data. For entrepreneurs, the lessons in this book can be extremely valuable. Focusing on acquiring new customers, increasing the physical and mental availability of the brand, and basing decisions on concrete data are all strategies that can lead to sustainable and successful growth. Implementing these ideas requires a change in mindset and a long-term commitment, but the results can be significant. For entrepreneurs looking to grow their brands in a competitive market, "How Brands Grow" offers a clear, evidence-based guide.
Deep Marketing is among the very few European agencies to base its entire activity solely on scientific marketing, starting from the scientific laws of Byron Sharp and his institute.