Are you a brand or a solution?

Everyone wants to be someone else. Alternately, everyone wants to evolve into someone different. In the case of human beings, who does not like a “new you” (or at least pretend to like one). When we get a new hairstyle, we get praises and brickbats, and then our internal self decides whether it can live with the praises or it cannot live with the brickbats. I wore informals to work after religiously wearing formals for two years and was showered with praises of looking different and fresh. Then my inner self decided that it couldn’t live with that change, and I was back to formals the very next week.

Brands don’t have it that easy. Brands do not have options to experiment too much and do not have the freedom of “trying things to see if they work”. Brands cautiously evolve, and while doing so they adopt changes that refresh / transform / expand on current brand understanding or perceptions.

Brand owners have started implementing this “evolution” strategy at a higher level, which is that of an organisation. Instead of adopting a strategy of brand evolution, organisations are increasingly referring themselves to as ‘solution companies’ (and not someone who sells products or brands). Taking the example of Xerox as a case in point.

In 2004, Xerox changed its corporate tagline from “The Document Company” to “Technology/Document Management/Consulting Services”

http://www.nytimes.com/2004/09/13/business/media/new-logo-and-tagline-for-xerox.html

….and in 2015 evolved into “Work can work better”

https://www.usatoday.com/story/money/business/2015/08/28/new-xerox-slogan-work-can-work-better/71296704/

In a space of 10-11 years, Xerox has moved from a product focused organisation to a solutions focused organisation twice. But what is so fundamentally different from what Xerox did in 2004 compared to what it does in 2017? The biggest change (other than technology creating better printers and copiers) is the focus towards enterprise document management services.

Now shifting focus to an industry that seems to have been ‘solutions driven’ right from the very onset. The biggest difference is that previously in this industry ‘brands provided solutions that consumers accepted’, while now ‘brands provide solutions that consumers ask’. This industry is none other than the beauty industry.

This article highlights in detail the role and influence of WeChat on beauty products marketing in China:

http://technode.com/2017/03/17/wechats-transformative-role-for-beauty-brands-in-china/

….while this article talks about how Unilever launched Evaus completely driven by influencers:

http://adage.com/article/cmo-strategy/unilever-s-brand-makes-pricey-upstarts-silly/308720/

These two articles bring out the essential difference between a “pseudo-solution” and an actual “solution”. Having a one-way dialogue with a brand manufacturer on Facebook doesn’t define as solutions driven and neither is consuming content posted by beauty manufacturers on WeChat. But creating a new brand by actually listening to influencers and their interactions with their followers is a real solution.

The dictionary meaning of solution is “a means of solving a problem or dealing with a difficult situation”. This begets a very basic question – isn’t the role of all brands (and products) to solve a problem? The word problem may have been replaced by need, but it is still a problem.

So why the fascination with solutions when brands are supposed to be solutions (for both fixed needs and ever changing ones)? From a marketing perspective, if being solution focused means serving a wide range of needs, then there is credibility in changing your organisation’s motto. But very few brands serve a large enough range of needs to justify themselves being called solution providers.

Or is calling yourself a solutions company a more fashionable or cool thing to do?

Consider the following points:

  • Almost every endeavour to become a solutions-focused business is branded. If there is a clear understanding of the need that created the solution, there should not be a need to brand it
  • It is a circular argument – your brands are supposed to be providing solutions; if it now going to be a solutions driven business, what are your brands going to do differently
  • Individual level customisation is not ‘solution focus’, which is more around customisation that addresses individual preferences, while keeping the brand values and perceptions intact. The ultimate objective is still to sell the brand
  • Is becoming solution focused means you are positioning the organisation as a one-stop-shop to address a comprehensive range of needs? Then there is a need to stop and evaluate, as your current brand portfolio may not be ready to become a one-stop-shop. This could be because existing brands don’t cater to a wide variety of needs and innovation is not a disciplined endeavour
  • You can order your coffee in more than 250 different ways in a Starbucks store. Does that make Starbucks a ‘coffee solutions’ business? Definitely not but definitely makes them a ‘coffee experience’ business. What would have made them a ‘coffee solutions’ business? Individual and enterprise level coffee channels, that not only makes and sells coffee but actively educates farmers on coffee farming / coffee bean research & development / sustainable coffee farming practices / express & enterprise channels for selling etc. Becoming a solutions provider is a much more loftier goal
  • A consumer’s understanding of a solution goes beyond being omnipresent or being able to cater to every need or whim – true solution focused businesses look at factors that influence a consumer’s life before, after and in-between brand purchase cycles. An individual’s need for solutions throughout his or her life is not demarcated or defined by brand choices – it is much higher order existential need

If we step away from the glamorous industries that get more than fair share of media coverage and get the highest amount of soundbites even if they change the angle of the curve of one alphabet in their logo, there are serious examples in other places of what it means to be a solutions business.

https://hbr.org/2007/05/silo-busting-how-to-execute-on-the-promise-of-customer-focus

In this 2007 Harvard Business Review article, Prof. Ranjay Gulati analyses what did GE Healthcare do to arrest the decline in the company’s performance. Key points to highlight the focus to become a true solutions company:

  • In 2001, Performance Solutions added as a unit to GE Healthcare to sell consulting services packaged with imaging equipment as integrated solutions (At the time, lots of companies were making the move from selling products to selling solutions in an attempt to differentiate themselves in increasingly commoditised markets)
  • Plans work in the beginning and revenues increase but by 2005 the unit’s performance suffers and revenues start declining – primary reason attributed to the inability of salespeople to communicate the value of consulting services (the “why”)
  • Turnaround solution that worked – In 2006, GE transformed the unit to focus on consumer needs in a more comprehensive fashion and de-linking the consulting services from its product portfolio
  • Why is this a great example of a true solutions focused business turnaround? – Moving away from viewing consumer problems from the lens of your own product, but from the consumer perspective

The GE Healthcare case study brings out an important characteristic of a true solutions-defined business – there shouldn’t be any forced link between brands in the portfolio and solutions offered. To be recognised as a solutions expert, organisations need to go beyond the following short-term and medium-term barriers:

  • A solutions focus cannot start or co-exist with a short-term profit mentality: A ‘complete solution’ solves for the difficulty of a process and aids in the final outcome. The final outcome may have a purchase of a brand (from the portfolio) as the solution but the process might be completely separated from the brand portfolio. So there is no space or opportunity here for short-term profit making motives to take hold
  • Solutions are by nature akin to processes: A solutions business needs to focus on becoming relevant on a journey (akin to a process). A counter argument would be that brands are increasingly looking at building preference and equity throughout the brand funnel. But solutions go beyond the brand funnel. A (simplified) example of how can a business become an “end-to-end clothes management solution”:

“Online aggregator store for garments purchase –> home delivery solution –> laundry pickup solution –> laundry washing solution –> folding / pressing / ironing solution –>home delivery solution”

  • Recognise and accept the fact that a branded portfolio has limitations in a solutions driven business: In the above simplified example, for the organisation pursuing the model, there won’t be brands to position at every stage of the journey. Even global laundry care behemoths like Ariel, Surf and Tide will struggle to own 10% of the whole journey. Organisations need to accept the fact that when a consumer is looking for an end-to-end solution, the need to have a “brand crutch” is not required at every stage

Deliveroo provides a home delivery solution for meals and acts as a restaurant aggregator. The same is being done by Just Eat and Hungry House and by the hundreds of home-delivery options offered by individual restaurants. The consumer is looking for a brand for the meal but would be largely indifferent if the same meal is being delivered by another home-delivery aggregator. Uber Eats is doing well in London as I write this.

  • To become a successful solutions provider, your supply chains and distribution networks will be your competitive advantage: Having a strong brand helps in maximising market share, revenues and profitability. But the unsung heroes in this whole scenario are the supply and distribution models that help a strong brand become and remain one. If you want to be a solutions-driven success, then you need to rely on supply chains and distribution networks very strongly (keeping in mind the fact that you are not relying on a brand but on providing solutions)
  • Having a solutions expertise leads to higher levels of loyalty (compared to brands): Although there may not be data-driven proof of this statement, but if I have to make a hypothesis, I will make a strong one. Our habits and the way we do things are more rigid than our brand choices (and brand loyalty). Solutions driven businesses need to work on “how we do things”, which is much harder than influencing “what we buy when we need <this>”. Going back to the GE Healthcare case, the factor that drove the turnaround was a deep understanding of how clients bought, understood functionality, disseminated knowledge and implemented technology from GE Healthcare. Although it is always a controversial topic, but the world’s biggest consulting firms enjoy strong brand loyalty because of the solutions expertise they sell (an average engagement handled by MBB would run into 12-18 months)

Selling a solution goes beyond providing an alternative to satisfy a need. Are any of the world’s biggest brands “solutions providers” or are “solution companies” in the truest sense of the word? Or is it a fair statement to make that brands can never be solution providers in categories where decision risks are lowloyalty is infinitesimalconsumers are more concerned about satisfying a whim and where the opportunity to develop a solutions-driven model is continuously ruptured by fragmentation?

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