About Market Diagnostic, Brand Audit and Local Snapshot
Developing and Using a brand audit
Growth is critical, but with it come challenges. The bigger a firm becomes, the harder it is for its leaders to keep tabs on each of their markets and to manage each one with an approach that remains balanced between responding to local information and being consistent with an overall strategy. Would a brand audit be able to help?
Gone are the days when a firm can achieve success by pushing a hegemonic strategy from corporate HQ into each market using branding that leverages the lowest common denominator across all potential consumers. The competition is too nimble, and the consumer / shopper is too complex. So how can a modern firm with global reach manage to leverage their scale and not get caught sleeping on the important local differences?
Read any brand strategy book or take any marketing course, and it’s apparent there are many philosophies that cover roughly the same ground. They are all recipes for funneling information and covering the whole market ecosystem. There’s two problems with this approach, however:
- First, because it’s usually done at a high level much of the crucial local insight gets lost by the researcher, especially if they are doing so remotely.
- Second, there is a big gap between theory and execution, which can lead to an unbalanced approach or sloppy conclusions.
One of the tools in the branding consultant’s toolbox that helps us in the industry to alleviate these problems is the Market Diagnostic, also commonly referred to as a Brand Audit. It is a template that helps structure and highlight granular information from local/regional markets in a way that helps decision makers understand the market factors that affect their brand before formulating their strategies.
The diagnostic borrows from the classic business frameworks mentioned above. However, what makes the diagnostic so useful to decision makers is that is customized to a specific business and it focuses on actionable and relevant data. Unlike the highly generalized strategic frameworks that are usually found in the strategy toolbox, the Market Diagnostic’s value is derived from how it can standardize the process across all regions and build upon locally gathered information, allowing the user to pinpoint potential challenges and opportunities. This approach alleviates the two areas of concern we highlighted earlier: execution and data selection.
In addition to synthesizing powerful information, the power of the diagnostic extends beyond the confines of a senior management team. It is documented and self-explanatory, enabling regional teams to use it autonomously. As the team becomes comfortable using the diagnostic, it will understand what information is crucial to the foundation of winning strategies. The team itself thinks as comprehensively as the tool itself.
Let me walk you through one such market diagnostic we’ve recently done for a client:
As you can see in the graphic above, we’ve arranged our process along several themes:
- An inside-out dimension- which explores the client vs. the rest of the market (competition)
- An outside-in dimension- where we explore the various competitors and how they stack up vs. the firm
- A consumer-centric dimension
- And finally, a customer-centric dimension
Once we settled on the major areas of discovery for our brand audit, we identified several key areas that we approached systematically from big-picture to granular level, and working through the value chain.
- Market Trends: understanding the fundamentals of the local marketplace, from market dynamics to localized industry and political trends.
- Value Chain: A look at the channels. Has anything changed?
- Customers: Understand who the key players are, what the trends are in this space, and what is driving these changes.
- Competitors: A look at the top brands. Who are the winners and losers, what were the factors in their fortunes.
- Consumers: A deep dive into their consumption habits, recent changes, etc. When and how do they consume the product/service?
- Communications: Evaluating the message through a look at the platforms in use and key metrics to understand how the message is being received.
- Shoppers: A look through their eyes- what is their objective, how do they encounter our product, what are their drivers.
- Products: Formats, placement, merchandising, promotion, etc.
In the end, as we all know, a brand is a crafted perception about a specific product; a promise to the consumer. The Market Diagnostic helps to understand each major area of a market/business/consumer that shapes this perception and delivers on their promise to the consumer.