Simplicity Can Add Billions To Brand Value
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Simplicity Can Add Billions To Brand Value

In the US, UK and Germany, brands that offer increased simplicity stand to gain $50 billion in revenue, says branding firm Siegel+Gale.

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In the US, UK and Germany, brands that offer increased simplicity stand to gain $50 billion in revenue, says branding firm Siegel+Gale, based on the findings of its fourth annual Global Brand Simplicity Index, which evaluates the state, significance and impact of simplicity on brands. The firms says a stock portfolio made from the publicly traded top 10 global simplest brands outperforms the major indexes.

The survey also found that 75 percent of consumers are more likely to recommend a brand because it provides simpler experiences and communications; in the US, 29 percent of consumers said they are willing to spend up to 4.6 percent more for a simpler experience.

The index is derived from more than 500 brand ratings across 25 industries, based on a survey of more than 10,000 consumers in North America, Europe, Asia and the Middle East. Once the results were aggregated, Siegel+Gale used the data to generate two scores to measure simplicity: a Brand Simplicity Score and an Industry Simplicity Score.

According to Howard Belk, co-CEO and chief creative officer of Siegel+Gale, “When consumers experience simplicity at every touchpoint—it inspires deeper trust and greater loyalty. This year’s Simplicity Index affirms that brands willing to simplify their customer experiences stand to gain more revenue. In the data, we have the percentage increase in price consumers said they would be willing to pay for simpler experiences offered by each brand included in the survey—a tangible illustration of the value of simplicity.

“Brands are leaving significant money on the table because of complexity.”

In 2012, Siegel+Gale explored how companies can make it easier for employees to innovate at work. Last year’s study uncovered that for employees, promoting innovative ideas was the second least simple thing to do in the workplace, just after asking for a raise. In other words, complexity kills innovation.

“This year, we dug deeper into the link between simplicity and innovation, and we learned that purpose is a critical factor,” said David Srere, co-CEO and chief strategy officer of Siegel+Gale. “According to our study, employees find it easiest to innovate when they understand and are committed to their company’s purpose. We now have empirical evidence that a clear purpose is critical to creating a culture of innovation. But it has to be communicated from the top down, and articulated through the lens of simplicity. At the end of the day, business leaders who invest in simplicity achieve increased revenue and foster innovation.”

The 2013 Global Brand Simplicity Index Top 10 Brands

1. ALDI. As the number one global brand, European-based discount supermarket retailer ALDI continues to enjoy extraordinary success. With more than 9,000 stores worldwide and a brand that “focuses on the essentials, no matter what city,” ALDI has made the most of its good-value-for-the-money reputation with both recession-strapped customers and shoppers just looking to spend less.
2. Amazon. Amazon earns the number two ranking on the Global Brand Simplicity Index, thanks in large part to a customer-first commitment—like its easy-to-use, 1-click ordering. And with every part of Amazon driven by data that tracks customer experience successes and failures, it’s no surprise the online retail giant keeps landing near the top of the Simplicity Index.
3. Google. Google slips from #1 last year to #3 this year. Despite losing its grip on the top spot, however, Google is still “a synonym for simplicity,” with a friendly and intuitive user interface. And Google continues to make mobile life easier with its new app, Google Now, which gives users information that fits their needs—like mobile airline boarding passes.
4. McDonald’s. Not surprisingly, the iconic American fast-food restaurant gets high marks for speed and convenience. But McDonald’s also wins points from consumers for its accessible menu, transparent pricing and clear, concise communications. And as concerns about obesity and other health issues rise, McDonald’s is moving forward with redesigned product packaging to include QR codes linked to nutritional information.
5. KFC. Despite a minor setback in China following a food safety scare in late 2012, KFC managed to make the Top 10 simplest global brands. Its straightforward lineup of food and pricing, paired with roadside ubiquity and a successful online coupon program, made KFC a favorite for many with an appetite for simplicity.
6. Carrefour. You’ll find French retailer, Carrefour, securely in the Top 10 again this year. The hypermarket, say respondents, carries “everything you need under one roof.” And under new CEO George Plassat, store managers can now tailor inventory in individual stores to match local tastes. That’s been a huge factor for Carrefour and its rise in relevancy to customers.
7. C&A. International Dutch fashion retailer C&A remains in the Top 10. With branches in 20 European countries, the brand is busy weaving RFID technology into its shopping experience so customers will always find the products they’re looking for on the shelves. Consumers describe C&A as a cost-effective brand you can rely on to make “shopping uncomplicated.”
8. Samsung. Its flagship product, the Android-operated Galaxy, has been stealing iPhone market share with its elegant design and easy-to-use functionality. And in an effort to shed its image as a hardware manufacturer, Samsung has been heavily investing in promoting its bold technology and innovation. Some respondents championed Samsung’s newfound creativity, while others praised its positioning as a modern yet accessible brand.
9. IKEA. If IKEA has a mission, it’s enhancing the everyday life of its customers. Mission accomplished. Offering easy-to-assemble products at low prices and easy-to-navigate stores, the Swedish company continues building a brand that makes home furnishing simple. Now IKEA is partnering with Marriott International, lending its expertise to help create a chain of hip, budget hotels.
10. Pizza Hut. As the world’s largest pizza franchise, Pizza Hut continues to pride itself on accessibility and convenience. And with its memorable ad campaigns and made-to-order menus, Pizza Hut easily rises above the competition. Now the brand’s recently updated website provides customers with a “completely fresh online experience”—including the ability to place orders through Xbox.

In addition, Apple falls out of the global top 10, dropping 14 spots to #19. As the Galaxy and the iPhone battle for smartphone supremacy, Samsung has overtaken Apple, earning the #8 spot on this year's Global Brand Simplicity Index.

Mega-retailer Walmart, once again the world’s largest company based on revenue, rose 24 spots to #14 of 92 brands on the Global Brand Simplicity Index. Predictably, many respondents hailed Walmart’s clear, simple message: “Low Prices. Every Day. On Everything.”

Search engine Bing is starting to give Google a run for its money, rising 42 spots this year to #26. Globally, respondents said they liked Bing’s more visual approach to its website as well as its intuitive qualities and ease of navigation.

German home appliance manufacturer Bosch moved up 33 spots from #65 last year to #32. Consumers enthusiastically applauded the brand’s simple, straightforward instructions and product manuals. They were also impressed with the high quality of Bosch products, which users say rarely need new parts or servicing.

Best Western, the world’s largest hotel chain rose 32 spots to #37 this year. Respondents believe the brand is up-front with rates and like the convenience of its widespread locations. With a top-rated website and the option to book hotel rooms through the brand’s Facebook page, it’s clear that Best Western wants to make trip planning as easy as possible for customers.
 

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