By Dr. Robert Passikoff
Do you know what consumers really expect from you? We mean from your brand in your particular category, because consumer expectations change from category-to-category. Do you know precisely what they expect? Not scalar ratings or even open-ended fill-in-the-number answer. But real unconstrained-by-reality expectation levels.
You do? Well good for you, because most brands don’t. Traditional measures don’t really paint a complete picture about consumer expectations, which are far more emotional than rational, so most brands end up guessing or are just plain wrong. If you don’t have a measure of real consumer expectations, you’re at a real disadvantage. Proven and validated, brands are measured by how well they are able to meet expectations that consumers hold for the Ideal in their category. Engagement with the brand (as, say, opposed to being engaged with a media platform or a sponsorship venue) is what the brand should be focusing on. Brands that are able to meet expectations – or, at least, do better than the competition – do better in the marketplace. Always. Those that can’t, well. . . .
You’re probably not surprised with the speed technology moves today or how much expectations related to technology have risen. It might surprise you to learn that only a short 4 years ago RIM, the company that brought the world Blackberry devices, was U.S. technology leader with a 41% share of the OS market and more than 50% of the market for phones that could browse the web and send emails. No joking. Those are real numbers.
We’ll give away the punch line by asking you to guess (or check your data) to estimate how much expectations have increased in the smartphone category over that same 4-year period. Go ahead. Check your data or just think about it. Take all the time you need. While you’re doing that, also think about how much brands were able to keep up. Write those two numbers on a piece of paper.
Finished? What might surprise you is that increasing consumer expectations for smartphones was more than twenty-eight percent over the past 4 years. Generally (it differs brand-to-brand of course) smartphone brands have been able to keep up by about ten percent. But, alas, RIM couldn’t manage that. No, an inability to understand that or a failure to accurately measure increased expectations ended up creating an consumer-generated emotional engagement “yardstick” RIM and the Blackberry brand just couldn’t measure up to.
And while expectations play a major, major role in how consumers will engage with brands, there were other, tangential events that wrecked havoc with the Blackberry brand. Employers – really big employers – moved to a BYOD (Bring-Your-Own-Device) philosophy, and – no surprise – employees looking for phones that met their expectations did just that. Mostly Samsung and Apple and HTC. Those brands’ new entries into the category fueled increased engagement and higher expectations and. . . well, the pattern that followed shouldn’t surprise you although it sure seems to have surprised RIM.
Emotional engagement assessments from smartphone customers in our January 2013 Customer Loyalty Engagement Index showed Blackberry at the very bottom of the rankings, significantly lower than expectations consumers held for the category Ideal even with the usual, expected, “what-the-hell-do-these-wacky-consumers-expect” brand-to-Ideal gap. That really big gap was a sign that RIM only had a really small window to succeed if they hoped to remain a viable player in the category. Unfortunately, their long-delayed Blackberry 10 didn’t do it even with a Super Bowl commercial. The loss of corporate and governmental clients sure didn’t help, and it should come as no surprise that the current Q2’13 estimates have Apple at a 40% share of the smartphone marketplace, Samsung with 25%, and HTC and Motorola at about 9% each.
That 9% is looking pretty good to RIM right about now because that’s what they had this time last year. This year it’s about 3%, down yet again. Corporate-speak for RIM’s Year-Over-Year decline is “Death Spiral.” This July, CEO Thorsten Heins told shareholders that the U.S. was a very competitive market (meaning expectations were up and competitive brands were doing a better job keeping up with them) and, “I have to say, from my personal experience visiting a lot of countries, it is a challenge in the U.S.”
He indicated that RIM was going to meet that challenge by becoming a niche brand – having Blackberry stand for a device that could seamlessly switch between business and personal use, despite considerable evidence to the contrary, e.g., the increased corporate BYOD trend and the increased number of security apps provided by competitive brands, this was a viable position to take.
At the time Mr. Heins indicated, “We will take this challenge on,” which, turns out to be corporate-speak for “we give up.” A few of weeks ago Blackberry hired J.P. Morgan Chase to explore “strategic alternatives,” corporate-speak for “we’re-for-sale-but-will-consider-any-reasonable-offer.” Companies like Lenovo, Microsoft, Samsung, and others have been mentioned as potential buyers, but one has to wonder if RIM would need to be sold off for parts to make that practicable for them, and – given the exceptionally low emotional engagement assessments – whether the brand has been so damaged it would just end up having to be jettisoned. Remember Palm?
In all Brand Keys surveys, for all categories, customer expectations continue to rise as consumers continue to want more and more and more. Brands able to meet or even exceed these expectations will always do better in the marketplace. And, no surprise, those that can’t eventually get gobbled up and/or vanish from the competitive landscape.