Diamond Supply Co. x Nike SB Diamond Dunk

It’s that time of the year when someone dares to analyze the brand winners and losers of 2018. And this year, our team at Vivaldi had plenty to select from.

It is impossible to give credit to all the best and worst performers. There are simply too many brands that apply. However, we are certain that the top winners and losers we chose hold valuable lessons for anyone looking to build a strong brand in the coming years.

It is clear that branding as we know it has changed forever. We used to live in a world of walls, with industries and categories that have clearly defined boundaries, and a set of similar brands to compete against. Back then, branding was about creating relevant differentiation, relative to those competitors. Branding was about cultivating an experience, eliciting an emotion, or communicating a unique belief system that would draw people into stores or online.

Today, we live in a world of webs, with the Internet, social networks, digital ecosystems and more. We’re all constantly connected with everyone, anywhere, anytime. Brands are built differently in this new world of ubiquitous connectivity, and our 2018 winners show the steps to this model of building strong brands.

So, without further ado, brace yourself for some powerful lessons on branding from our list of seven winners and six losers.

Strong brands…

build a direct connection with their consumers. Nike doubled down on direct-to-consumer in 2018 by increasing sales channels to include Facebook and Instagram. They began selling directly through Amazon, a big u-turn. This “consumer direct offense” game plan is fueled by an equally aptly named strategy, the “triple double” strategy, which means twice the innovation, speed and direct connection. It worked — Nike’s DTC attack outpaced wholesale by a huge margin.

make consumers contributors to value. Tesla cars harness an exponential intelligence. The network effect driving this growing brain occurs every time a car is driven. They claim a billion miles, versus just 10 million for Google’s Waymo. Teslas actively learn from experience, becoming better, smarter and more effective by the mile. Every time a consumer gets behind the wheel, their drive improves and the Tesla brand grows.

build an interaction field that delivers on your brand promise. Amazon has always stood for convenience. An interaction field consists of a set of exchanges that are enabled by participants or technology. Amazon now lists more than three million products, many from participants called third-party merchants. They eclipsed 100 million Prime subscribers despite increasing the cost. Frictionless commerce is enabled by 50 million Echos in people’s homes. And through investment in predictive analytics that store, process and analyze personal information, you can say, “Hey Alexa, order some toilet paper,” and they’ll send your preferred roll.

ride the wave, but understand that waves can crash. Juul grew monumentally in 2018, and “juuling” became a new verb. It won through innovative products, flavors and a wildly successful campaign targeting Millennials and Gen Z. Juul sponsors parties, vapor lounges, and attractive models on social media (#JUULmoment). They were rewarded with 75 percent-plus market share and a $16 billion valuation in just three years. It also landed them in serious hot water with the Food and Drug Administration.

sell things that consumers want, the way consumers want them. Overall car ownership is down, but there’s never been greater demand for mobility subscriptions. This year, Volvo and Cadillac rolled them out in a big way, but only the former was successful. The catch? People need to want to drive the cars — subscription or not. Ask Cadillac about the CT6, or ask owners if you can find them. You still need a product that consumers want.

hyper-personalize, and then do it again. What does technology have to do with ordering a pizza? A whole lot, according to Dominos. First they fixed the product, which they admitted tasted like cardboard. Then, they remembered their purpose: convenience — “30 minutes or it’s free!” That was then. Now, they swear by digital and social, built atop a massive platform business powered by analytics. “DPZ’s” stock has appreciated more than “AAPL.” What’s next, Pizza delivered by drones, perhaps?

…don’t try to be amazing, try to be amazingly useful, as quoted by Jay Baer. Say “au revoir” to Louis Vuitton and their romanticized, impractical luggage. Away has disrupted the luggage industry with functional, cost-efficient bags with USB chargers. The company, whose annual sales tripled in 2018, won by bringing functional simplicity to an industry ruled by form.

…don’t fake it, face it. Facebook has had a poor year, between their hearings and loss of Millennial and Gen Z interest — 42 percent of young adults took a break from it in 2018. “Deny, delay and deflect” is not a winning strategy. Even Facebook employees were wondering why their chief executive officer wasn’t discussing the elephant in the room.

…listen carefully, don’t be tone-deaf. Victoria’s Secret, where have you been, living under a rock? We live in the #MeToo era. Their “fantasy” brand essence is antithetical to the modern sentiment of inclusivity and authenticity, but they doubled down on it anyway. As a result, their stock price will ring in the new year at a near 10-year low. Brands that act like your embarrassing great uncle, who refuse to adapt thought and action to the modern times, will inevitably fall. R.I.P. Sears and Toys ‘R’ Us.

…there is no way to hide, just take a stand. Under Armour talked all about female empowerment in their ads, while their company culture proved the opposite. You are what you do, not what you say. In today’s era, brands define themselves by their actions. And from Under Armour there was only inaction, and they suffered at the hands of it. Even their sponsorship of Stephen Curry couldn’t fix it. Just do it, Under Armour.

Dr. Erich Joachimsthaler is chief executive officer and founder of Vivaldi.

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