Over reliance on marketing activities that deliver short-term sales growth is impacting the ability of businesses to lock in long-term market share growth, according to new research.

Leading data, insights, and consulting company Kantar has released its latest study, Mastering Momentum, which analysed the market share of 3,900 brands over a three-year period. The research found that fewer than six percent of brands grew market share over one year, while only six-in-ten of those sustained that gain over three years.

Meanwhile, fewer than one-in-ten (of the six percent) improved on their initial gain, leaving a small ‘One Percent Club’ of brands that have mastered the art of building sales momentum in the long term.

The analysis by Kantar – which will be represented on the judging panels of the upcoming UK Digital Experience Awards and UK Customer Experience Awards – reveals many brands could be sitting on a potential growth goldmine, with this opportunity not only reserved for small businesses; two out of five of the biggest brands managed to hold ground or grow between 2015 and 2018.

Mark Chamberlain, Managing Director, Brand, Insights Division at Kantar UK, said: “Businesses in today’s world are under enormous short-term pressure so they look for guidance from the most readily available data, such as raw searches, sales and clicks.

“This data focuses attention only on what’s happening here and now, so it’s no surprise that the activities that demonstrate an immediate return tend to win in the competition for budget. Marketeers need to be bold enough to consider the bigger longer-term picture. Our latest global BrandZ report clearly illustrates how a strong brand delivers superior shareholder returns. Identifying reliable short-term indicators of long-term success is essential to unlock the missed opportunity of future business growth.”

With only 52 percent of advertisers confident their organisation has the right balance between long-term brand building and short-term performance marketing (Kantar Getting Media Right 2018), the new report recommends marketers focus on three key points in the buyer lifecycle to create sustained growth:

  • Experience: influence repeat sales by delighting existing users, as they are the foundation upon which growth is built
  • Exposure: influence future sales by reaching out to new potential buyers and establishing meaningful difference through compelling creative and targeted media investment
  • Activation: influence immediate sales by ensuring the brand and its meaningful difference come readily to mind at the point of sale.

According to Kantar’s analysis, the brands that managed to move to the needle across all three activities achieved 65x more growth than average. The study also found that brand size significantly influences growth prospects, making it critical for businesses to balance investment across brand building and demand generation accordingly.

Commenting on the findings, Nigel Hollis, Chief Global Analyst, Insights Division at Kantar UK said: “Sustained, long-term growth is hard, but there is a huge opportunity for businesses that are willing to look beyond simply delivering the next quarter’s numbers. Brands that tailor a growth strategy relevant to their market position outperform those that only grow penetration by an average of 45 percent.

“Small brands have little choice but to focus on increasing acquisition from competitors, while market leaders need to invest in improving the experience for existing customers, and, to a lesser degree, bringing in new category buyers. Unless you have the budget to spend continuously, growth will be hard to come by if you rely only on short-term incremental effects.”

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