Five major brand trends predicted for 2023

2023 is coming. Affected by various factors, brand trends are changing and full of opportunities. In this regard, the author of this article shares his thoughts and predictions on the overall brand trends in 2023. I recommend this article to those who are interested in brands. I hope it will be helpful to you.

In December, we held an online event for Mulan Sister Black Gold Members. The theme at that time was: How to restart the brand's sea of ​​stars?

Affected by the sequelae of masks, 2023 will still not be an easy year, but everything needs to be rebuilt, and the word recovery must be the main theme throughout 2023. I believe everyone is seeking progress in stability and is ready to go. So let me share some of my insights and thoughts.

1. The core value of the past was optimization and efficiency, while the core value of the future is creation and experience

In the current competition, most companies are still competing in terms of product functions, performance, price, cost, efficiency, etc.

Competition in this area will undoubtedly continue for a long time, but the difficulty will continue to increase, and it will quickly enter a red ocean and low-profit period. So I think the new business opportunities and premium parts in the future will gradually shift to spiritual and service premiums.

We need to re-understand the value demands of the new core group, based on human values, and create new possibilities from the perspective of the new group.

Some time ago, when I was interviewed by Pinguan Cosmetics Observation, we talked about the topic of #HARMAY话梅簋市,话梅黑市#, which I think is a very typical case of innovation.

Faced with the impact of the epidemic on offline physical retail, Huamei has subverted the promotional changes in offline beauty retail with innovative scene content experience.

• Membership system. While increasing product discounts, Guishi also adopted a ticketing system. Consumers must first purchase a 39-yuan pass before entering Guishi, while Huamei Black Card members can enter for free.
• Limited time. The entire Guishi store is expected to be open for three months. In the 80% discount area, the lowest discount in Guishi, consumers only have 10 minutes to shop, and only 10 consumers can enter every 10 minutes.
• The scene is innovated in the form of a secret room. The design of Guishi is dark and slightly scary, similar to escape rooms and script-killing games. The overall color scheme is red and black, creating a "haunted house" with a Gothic style.

This time, Huamai extended the "black market" to offline, introducing a "secret room" setting that meets the aesthetic standards of the younger generation, a large number of brands and SKUs at super low prices, and the excitement of "treasure hunting" and opening blind boxes.

It can be seen that it is not only about discounts, but also about scene innovation and user connection. The uniqueness of Huamei Guishi lies in breaking the stereotype that "discounts mean cheapness" and achieving the matching of channels and user value.

This is also what we mean when we say that experience is more than three times the value of the product. Only when the experience is good can your product bring greater value . This actually means making users feel at ease, worry-free, and comfortable, and bringing them more value over money.

2. Super user thinking leads brands to restructure user relationships and interaction methods

According to data from Nielsen, a world-renowned company, super users have 5-10 times the spending power of ordinary users. Every 1% increase in their spending power leads to a 10-15% increase in new customers and a 20%-25% sales growth, which shows the enormous value of super users.

In other words, high-quality super users are an important factor in the launch of new products. They are living billboards, spreading and promoting products for free, creating brand exposure.

For brands, people are not simply data representations, there are intricate emotional connections behind them, and brands need to reconstruct user relationships and interaction methods.

When the niche cosmetics brand Kaleidoscope was cold-started, it achieved low-cost user conversion and sustained high sales growth through super users with unique styles.

For example, because of the product's unique colors and styles, Kaleidos Kaleidoscope is more likely to attract some "advanced makeup users". These users are relatively experienced, so they like to try foreign niche products through overseas shopping, purchasing agents, etc. The brand will also cooperate with the concept of "playing with makeup", attracting this group of highly sticky users in the early stage.

As experienced makeup users, whether they are sharing products, experiences and makeup techniques on social media or recommending products to their friends, these users are all “opinion leaders” (KOLs) in the makeup field. Therefore, the users attracted by Kaleidos quickly spread to more users, and the brand’s reputation and influence gradually expanded.

At the same time, as the core consumer group of the brand, this group of opinion leaders understands the product very well. Therefore, every time Kaleidos Kaleidoscope releases a new product, the team will collect their opinions on color matching, name, etc. in the fan group and brainstorm with everyone. Finally, everyone's ideas are combined with the brand's creativity. After a batch is produced, the core users are invited to try it out first. If the feedback is positive, it will be quickly mass-produced and put on the market.

What we can learn from the Kaleidos case study is that in this era where “all businesses are worth doing over again,” super users are not just the “shopping addicts” with the highest purchase frequency; they are also the “carriers” of contagious brand genes and the driving forces behind the “new species.”

3. If new products want to gain a foothold in the market, they must have an absolute advantage, not just a slight advantage.

Although we often say that consumers tend to get bored with the old and love the new, it is much more difficult to convince consumers to try a similar new product than to continue buying the old product.

The consumption habits formed by users for products are the competitive advantage of large companies.

Therefore, for a new brand in an industry, it is very easy to get consumers to try a new product once, but it is very difficult to get them to develop consumption habits for this brand or product.

There is a consensus in the industry that the cost of acquiring a new user is 5-10 times the cost of maintaining an old user.

Many business operators mistakenly believe that a new product can win users’ hearts and minds at first sight as long as it is slightly better than the original product. However, when it comes to shaking up users’ old habits, brands will find that good products do not always have the upper hand, especially when many users have already chosen other competitive products.

The result is that we often see many innovations fail because consumers always rely too much on existing products, while brands always overestimate new products.

This is why many entrepreneurs, including Lei Jun, emphasize that if your products and services are only 50% better or even twice as good as those already on the market, they are useless.

Because the influence of the original product has penetrated deeply into the bones, if you want to shake the user's usage habits, the new product or service must have the power to overwhelm the enemy. Achieving 100 points in core attributes is just the duty, and getting 120 points is just a chance.

So how can we improve and amplify the value of our products? I have summarized five points and would like to share them with you:

1. Find the anchor point of product value: What do consumers really need? Why do they have such needs? Can we satisfy them? Therefore, give users a reason to buy and grasp user needs. This value anchor point must be single, accurate, and irreplaceable to users.
2. Choose a good name: A good name can save half of the advertising costs, so give your product a name that is easy to remember, understand, and spread.
3. Good packaging: No matter how good your product is, it will be better if there is content output, and content must be the core. Therefore, you must do a good job of product packaging to shape the product value. Your product needs a real and good story (telling about the origin, history, and uniqueness), and a story that can be told to consumers.
4. Stick to quality: Quality is the minimum guarantee for products, and good products are the best marketing! Only when the product is perfect, it is equivalent to having good content when it is disseminated. Only with content can there be good traffic and more opportunities.
5. Deepen user experience: Only when users feel, are shocked, and touched during the experience, and they will never forget it and think that your product is good, will your word-of-mouth marketing be formed layer by layer and finally form real brand value.

4. The worse the economy is, the more consumers will choose products that are reasonably priced and offer great value for money.

This epidemic is likely to drive a huge change in the consumption habits of the entire society. Logically, it is not a downgrade in consumption, but an "upgrade in downgrade". The epidemic will accelerate China into the next consumption era: the more the economy is depressed, the more cost-effective or value-for-money products will become the first choice of consumers.

On the one hand, there are brands that restrain greed, hold high the banner of cost-effectiveness, and have the resilience to withstand fluctuations in the global economic cycle.

For example, since 2022, Heytea and Nayuki Tea have collectively lowered their prices, bidding farewell to the "30 yuan" era, which invisibly raised the cost-effectiveness in the minds of users.

Mixue Bingcheng reaches more consumers by being cheaper than its peers, and increases repeat purchases. It then uses sales scale to spread costs and leave room for profit. Therefore, even though its gross profit margin is lower than its peers, it does not prevent Mixue from making money. On the one hand, new domestic products no longer rely purely on low-price strategies, but on the premise of hitting the pain points of demand and providing differentiated competitive advantages, they set new price ranges for two discontinued products to provide consumers with value-for-money products.

For example, "San Dun Ban" prices its products at 5 to 10 yuan, which just fills the price gap in the instant coffee market. The product is higher than the traditional instant coffee priced at 1 to 2 yuan, consolidating the concept of "high-quality" in the instant coffee field, and its own products are lower than the price of coffee in convenience stores such as FamilyMart and Sinopec.

In the future, the birth of many new brands may be concentrated in the range of "reasonable price + great value for money" .

Categories that have achieved price increases through aesthetic packaging and market innovation; and categories that have reduced prices through cost control and extreme cost-effectiveness, and ultimately covered more unmet needs of the population, are all areas that deserve special attention.

5. Young people pay for what they like, and the era of interest-based consumption has arrived

"The Fourth Consumer Age" once talked about the most influential generation of young people in the Japanese consumer market. They buy fashion, design, and what they like, which is completely different from buying carrots and vegetables. This is not simple consumption, but consumption to create their own lifestyle.

At present, interest-based consumption has become very popular in China - blind boxes, trendy toys, Hanfu, camping, Lu Chong, skateboarding, etc., are essentially spiritual pursuits, aesthetic satisfaction, and interest-based consumption that go beyond the basic survival needs at the bottom level of Maslow's needs.

At the same time, private domains and social media help brands with "interest insights" and "interest planting", while China's powerful supply chain will become the backing support for the brand's "interest customization" model.

I believe that interest-based consumption will be a relatively long-term and stable consumption in the future. The underlying logic behind this is that young people are using interests to match circles.

Young people who share common values, life attitudes, hobbies, and consumption tendencies will naturally connect and combine into a cultural circle. A circle is not a label. People in a circle can use the circle to be close to like-minded people in the same spiritual continent.

Among the brands that are currently doing relatively well, my former employer MINISO is one of them. In recent years, MINISO has taken advantage of the momentum of "cultural and creative + national trend + IP" and strategically deployed interest categories, which has given rise to a new consumption trend: upgraded categories focusing on interest consumption, such as aromatherapy, accessories, beauty tools, and national trend toys, have a gross profit margin close to or exceeding 60%, and the terminal gross profit margin of some key SKUs is even close to 70%.

This requires brands to launch a large-scale "interest creation" under the product framework of emphasizing emotional value and "good-looking, fun, and easy to use". Whether you sell cameras, water cups, accessories, toys, or anything else, you must study user interests.

The above is my prediction of the overall brand trend in 2023. Of course, the prediction is about future changes, and the change is how to seize this opportunity. I wish you all can win both online and offline in the competition with yourself, the market, and users in the new year, increase revenue, and resist risks.

Author: Sister Mulan

Source public account: Mulanjie (ID: mulanjie-)