Nike Vs Pepsi: 10 Growth Lessons to Learn from Epic Gambles

We are squarely in the age of ‘wokeness’ - the state of being aware and motivated by problematic norms, systemic injustices and the overall status quo.

This is presenting businesses and brands with the opportunities to demonstrate their purpose and reveal their values, in the hope it will help them connect deeply with their target audiences, even if there is a risk of causing controversy in the process.

However, Justin Wright, co-Founder of Mangrove and co-author of ‘Stretchonomics: The art and science of success’, explains that for every Nike and Colin Kaepernick success story there’s a Pepsi and Kendall Jenner PR disaster. These brand gambles reveal 10 lessons from which all CEOs can learn.

1. Play to win, not to avoid defeat

Too many big businesses are paralysed by the fear of losing their market leadership position by being bold and making a mistake. Brands that make these bold statements of purpose are at least playing to win and not protecting what they have. In the words of Talladega Night’s Ricky Bobby; “if you ain’t first, you’re last!”

2. The biggest risk is doing nothing

Given the growing battle for consumer attention and the need to be distinctive, there is a greater risk of doing nothing and falling out of the consumer and social consciousness all together.

3. Take a stand

In the words of Public Enemy, “if you don’t stand for something, you fall for anything.” This has never been more true. Who wants a relationship with a brand or business that doesn’t have a point of view, even if it’s a view you don’t share?

4. Be prepared to polarise

Having a strong point of view on a big issue will invariably result in alienating some people. So what? Do you need those contrarians anyway? Nike’s Kaepernick tagline says it all: “Believe in something even it means sacrificing everything”. This campaign saw Nike lose a swathe of middle-aged, middle-class, middle-Americans but gain a lot more young, higher-spending, BAME consumers that drove a 31% upturn in sales.

5. Understand your current & future customers

And this highlights the next lesson – you need to understand your customer-base, what they think, and which types of customer are most valuable to you. Then the gamble becomes a calculated one that could benefit in recruiting the next generation of consumers and losing some with less spending power or influence.

6. Be genuine

Pespi’s disastrous ad featuring Kendall Jenner had to be pulled after accusations it trivialized the Black Live Matter movement. It was a clumsy attempt by Pepsi to attach itself to a very real controversy over the treatment of Black protesters in the US by the police. It suggested sharing a Pepsi could bridge the deep divide between police and protesters – an idea that bore no resemblance to the reality of the situation and was a role that Pepsi had no right to claim anyway. The whole concept was ill-conceived and an obvious marketing ploy. If you are not genuine about what you stand for and have a real reason for doing so then the gamble will always backfire.

7. Be consistent

Once you’ve demonstrated your purpose and cause, you have to stick with it and avoid the temptation to jump into a different cultural conversation. Not only is this disingenuous, it can mean missing the opportunity to really drive the narrative rather than just associate yourself with it. Think about Unilever and sustainability. Even if you question the progress they have made, at least they have clearly stated their intentions and stuck to their mission for several years now.

8. Avoid short-termism

Many brands and businesses would never dream of taking these purpose-driven gambles because they’re too focused on delivering next quarter’s sales results. The short-term pressures on CEOs to deliver the numbers has never been greater, but this creates a risk of neglecting long-term brand building. The emergence of Performance Marketing has placed greater focus on short-term sales optimisation, often at the expense of brand health. A well planned and executed purpose-play could build long-term emotional connection with your customers.

9. Think and act like a challenger

What’s most amazing about Nike’s Kaepernick gamble was that it happened in the US – their home country and biggest market, and they didn’t need to do it! This was a rare case of an Establishment brand acting like a Challenger brand. This was more typical of a smaller player with more to gain than lose. All big businesses should learn to think and act more like a Challenger, because the real risks are generally a lot less than they are perceived to be. Gillette’s Toxic Masculinity campaign was generally slated but did it really cause any reputational damage or negatively impact sales? No, because there is some truth in the old cliché; any publicity is good publicity.

10. Be agile

Finally, once you have your purpose, be prepared to respond quickly when the opportunities to demonstrate it present themselves. This requires a streamlined and decentralized decision-making process and a culture that encourages calculated gambles without punishing anybody when they don’t pay off.

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