What Top Beverage Executives Are Saying About How to Build a Brand

This blog first appeared as Dave Farber's piece for Medium

By Dave Farber

​Harvard Business School recently brought together a group of executives from the beverage industry to share their thoughts on what modern companies need to do to build a brand. It became clear that success requires recognizing that today’s customers are trying to buy an experience rather than a product. In fact, while most companies focus their innovation efforts on building a better product, research has shown that the biggest opportunities lie in innovating around the customer experience and the profit model. After speaking with the executives in attendance, I felt compelled to share three lessons on how companies can build a brand experience that translates into sustained share of wallet.

Companies need a story that consumers can connect with. A few years ago, Absolut had a realization that drastically changed the way it marketed vodka. For years, the company assumed that retail shoppers were looking for a high-quality, premium vodka that they could buy to impress their guests, and its marketing reflected that assumption. Looking to boost sales, the company sent researchers to house parties across the U.S. to better understand why people chose one brand over another. What they found was that, quite often, spirits were actually purchased by guests who aim to arrive with a small gift and a story for their hosts. Especially among millennials, industry insiders have found that there’s a heightened desire to introduce others to something exclusive or something they haven’t tried before. Will Willis, co-founder of Bully Boy Distillers acknowledged that others in the industry have learned similar lessons to Absolut’s. “We’re a story-based brand. Consumers want to feel that connection. Having a story is a way to build that sense of trust and authenticity.” While attributes like “all natural ingredients” or “premium quality” can be easily copied, a unique story can reveal what a brand really stands for and what makes it different.

A company’s story needs to be scalable. While having a story is important, not just any story will do. Too many companies make the mistake of telling a story that focuses on their location. They pride themselves on being local. While that may work for a while, it limits your ability to become more than a regional player. Chris Lohring, the founder of Notch Brewing — which helped make session beers a category in the U.S. — told us that customers ask new breweries two questions. First, they want to know what your beer is all about. Second, they want to know where you’re from. His advice? “Your first answer needs to be really good so that the second one doesn’t matter.”
Garth Hankinson, Senior Vice President for Corporate Development at Constellation Brands — the parent of brands like Corona and Robert Mondavi — agreed. Having responsibility for acquisitions at Constellation, Hankinson noted that he can’t justify acquiring a brand that doesn’t have the potential to be a national brand. When a company builds its story around being local, the sales and marketing hurdles to gaining national attention are simply too great.

The consumer connection needs to exist beyond the transaction. Just having a product on the shelf with a great widely-relatable story isn’t enough. Even the best brand story will have limited impact if it doesn’t stick in the consumer’s mind. Tim Brown, President and CEO of Nestlé Waters North America, summed it up best, “You can’t just be in the customer’s life at the point of purchase. You need to be in their life at different points in the customer journey.” As customers go about their day trying to get things done, there will be routines and forces that pull them in a variety of directions. They may never end up at the store that sells your product. Perhaps they’ll go straight to the website of a competitor, or maybe they will end up satisfying their needs with a product from a completely different category. If your brand story isn’t regularly top of mind for your customers, they become imminently poachable.

Thinking beyond the beverage industry, Uber offers a good example of how even purpose brands — those that are inextricably linked to the jobs they help consumers get done — can stay in the customer’s mind even when they’re not being purchased or called upon. This past holiday season, Uber offered free ugly Christmas sweaters to those who opened the app and requested them. In doing so, customers were exposed to the company’s new streamlined app design. Uber regularly delivers treats — from on-demand summer ice cream to puppy-petting sessions — to keep customers interacting with its platform. Recently, Uber has also been stepping up the marketing of its Uber Eats platform, bringing the company into consumers’ dining decisions. The more time customers spend using your product, the less likely they are to even consider a potential competitor, including one that might be newer, better, or cheaper.

Regardless of industry or company size, brands need to be experiential and offer customers a story that truly resonates. The best brand stories transcend geographical boundaries, and they remain on consumers’ minds well beyond the point of sale. While it’s no easy task, companies that build such compelling stories are well positioned to attract and retain customers even in the presence of striking alternatives.

Dave Farber is a strategy and innovation consultant at New Markets Advisors. He helps companies understand customer needs, build innovation capabilities, and develop plans for growth. He is a co-author of the award-winning book Jobs to be Done: A Roadmap for Customer-Centered Innovation.