ArnoldOn: Sherpa Brands-Guiding Consumers to New Heights

SHERPA BRANDSGuiding Consumers To New Heights

Arnold on

explores cultural, brand

and consumer trends that are

directly impacting businesses today.

through a combination of cultural

observation and proprietary qualitative

and quantitative research, we aim to

uncover meaningful shifts in attitudes

and behaviors and provide marketers

with ways to harness these trends

to benefit their brands and

businesses.

It’s been more than 50 years since Jean

Nidetch from Queens, New York, invited

a group of friends over to her apartment

to confess her addiction to cookies. The

positive reinforcement she received from

them helped her overcome her weight

issues and recognize that an essential

component to losing weight and changing

bad eating habits is the support and

guidance of other like-minded people.

This experience was also the catalyst to

the creation of Weight Watchers, the

company she founded, which has since

helped millions of people in 30 countries

navigate the path to healthier lifestyles.

Throughout the years, Weight Watchers

has provided real guidance and support,

given relevant, actionable advice about

healthy options, and offered tools, like

its points system, to make the journey

easier. All the while, the brand has

enabled program participants to

celebrate and enjoy their progress and

accomplishments over their journey.

Weight Watchers, at its core, is a brand

that guides customers to the right solution

for them, and it’s a quintessential example

of what Arnold Worldwide has identified

as a “Sherpa brand.”

This edition of Arnold On focuses on

Sherpa brands.

As part of ongoing work and research

with our clients, we have uncovered

an emerging need for brands to provide

increased guidance, empowerment, trust

and emotional rewards.

To better understand this need and

to probe consumer attitudes, Arnold

Worldwide conducted a survey of 2,400

respondents in the U.S., U.K., Brazil

and China.

In the following report, we’ll explore

the definition of Sherpa brands and

their significance in today’s consumer

marketplace, as well as provide

actionable ways in which all brands

can build Sherpa qualities.

These findings can help brands uncover

a new way to build stronger relationships

with their customers to drive brand affinity.

CONTENTS

The Emergence of Sherpa Brands 3

The Role of a Sherpa Brand 9

Sherpa Brands Win 17

How to Become a Sherpa Brand 21

21

3

The Sherpa are a group of Tibetans who live in the high Himalayan mountain regions of Nepal. Because they have lived in the area for hundreds of years, the Sherpa people are experts when it comes to the local mountainous terrain. In fact, they are so skilled at their craft that the term “Sherpa” has become synonymous with any expert mountain guide anywhere in the world.

Sherpas use their knowledge and experience to help mountaineers make better decisions as they navigate difficult terrain. They provide helpful information and tools to make the journey easier and act as a trusted resource along the mountaineers’ path. But the most interesting dynamic of Sherpas is that at these magnificent summits, they stand back and let mountaineers revel in their personal accomplishment.

With the “difficult terrain” that many consumers face today – conflicting opinions and overwhelming information and choices – brands have begun embracing the qualities of the Sherpa to help consumers sift through and make sense of it all. Sherpa brands are leveraging their category expertise to help consumers feel more informed, more in control and empowered, and to help these consumers celebrate their personal accomplishments.

THE EmERGENCE Of SHERPA BRANDS

4

Q: How would you describe your outlook for the world around you in the next 12 months?

Q: How would you describe your outlook for your life in the next 12 months?

Q: Thinking about the next 12 months, what are your top priorities in life?

12% 16% 18% 22%30%

39% 43%49% 46%

68%

37% 41%52% 56%58%

66%

81% 85%

62%

83%

Consumer Outlooks

U.K. U.S.GLOBAL BRAZIL CHINA

U.K. U.S.GLOBAL BRAZIL CHINA

POSITIVE WORLD OUTLOOK

FALL 2011 FALL 2012

POSITIVE PERSONAL OUTLOOK

GLOBAL PRIORITIES FOR NEXT 12 MONTHS:

FALL 2011 FALL 2012

Have more financial

stability and security

Focus on my health Spend more time with

friends and family

1 2 3

40% 39% 31%

ExTERNAl AND INTERNAl fORCES SHAPING CONSUmERS’ lIvES

In our survey, we found that while

consumers’ outlook for the world

around them is improving, they are

still feeling external pressures, like

economic uncertainty caused by the

lingering effects of the global recession,

as well as political instability, that are

beyond their control.

These factors are compounded by the

overwhelming amount of information

that exists today. Consumers are

striving to strike a better balance and

achieve well-being in their lives.

They want to spend less time worrying

and more time on personal fulfillment,

such as connecting with friends and

family, and making better, healthier

decisions.

One way Sherpa brands are responding

to these shifts is by alleviating some of

the stress. They’re guiding consumers

to decisions in a multitude of areas,

like financial management and

healthcare. They also help people to be

more productive and give them a sense

of achievement, while saving them

time and money that can be used on

the things they really enjoy.

65

Q: Which values do you feel have become mORE ImPORTANT to you in the last few months? (choose top 3)

ACCElERATING AND EmERGING PERSONAl vAlUES

As part of this research, we identified

an acceleration of several values –

optimism, stability and prioritization –

as well as emerging values – control

and practicality. Consumers want to

feel in charge of their personal journeys

and Sherpa brands are making a

significant impact in this area.

Optimism: There’s no shortage of

negative news weighing on consumers’

minds. However, they are responding

positively by choosing to see the silver

lining. They seek greater contentment

and fulfillment in their lives and are

adopting a brighter view about what’s

to come.

Stability: following the financial and

housing market collapses in 2007–08,

consumers took a more conservative

approach to spending. In today’s

environment, financial stability means

more than spending only on the

essentials. Consumers are increasingly

spending on the affordable indulgences

that matter to them, provide them

with value and make their lives better.

Prioritization: People are looking to

strike a better balance in their lives,

but need to understand and manage

the trade-offs. Ultimately, they are

looking for help to prioritize what’s

most important to them. In a world

where you can’t have everything,

people want to understand their

choices and need to be guided to

the decisions that are best for them.

Control: With so much instability in

the world, consumers want to gain a

tighter grip on the things within their

power. Consumers are seeking tools

and resources to help them make

informed decisions, but also want

to remain in control of the decision-

making process.

Practicality: As the economy recovers,

smart consumers remain thoughtful in

their purchase decisions. While people

want products that are well designed

and provide them with a great

experience, they are also seeking utility

to ensure that they spend their money

wisely and make the right decision.

Importance of Personal values vs.

Change in Importance over the Past Year

Important Values

Connections

40%

35%

30%

25%

20%

15%

10%

5%

0%

–8% –6% –4% –2% –0% +2% +4% +6% +8%

Relaxation

Responsibility

Optimism

Stability

Prioritization

Control

Practicality

Balance

Safety

Simplification

Fun

Carpe DiemSustainability

Accelerating Values

Declining Values Emerging Values

Import

ance o

f Valu

es (

Fall 2

012)

Change in Importance (Fall 2012 vs. Fall 2011)

Honesty

Values in 2012–2013

87

Q: How important is it for a brand to help guide you to the decisions or choices that make the best of your daily life?9

Given external concerns and accelerating personal values, we have found a growing demand for guidance. Through our research, we found that 81% of consumers worldwide think it’s important for a brand to guide them to better decisions. This has resulted in the emergence of Sherpa brands.

Sherpa brands help people see the path, inform them at key decision points, provide decision-making tools along the way and help people navigate through their journey. The goal is to guide the consumer through a process, whether it’s the path to better health, financial freedom, planning a vacation or buying a new car. But like a real Sherpa, who enables climbers to celebrate at the mountain summit, Sherpa brands help people celebrate their own accomplishments.

Ultimately, Sherpa brands play a more meaningful role in consumers’ lives, achieving higher levels of trust and loyalty.

THE ROlE Of A SHERPA BRAND

U.S.

U.K.

China

Brazil

10

Q: How important is it for a Sherpa brand to have each of these characteristics?

Q: Which of these characteristics are most important for a Sherpa brand?

Q: Which of the following best describes how a brand that helps guide you to the decisions or choices that make the best of your daily life make you feel?

CHARACTERISTICS Of A SHERPA BRAND

While there are many characteristics

that define a Sherpa brand, there are

a few that reign supreme.

By providing guidance – including helpful

information and solutions to consumer

problems – Sherpa brands help

consumers navigate and make better

decisions. They strike a balance between

doing everything for the consumer and

the consumer doing it all.

Additionally, they make the decision-

making process less complex, easier to

understand and help consumers make

the choices that are right for them.

These elements lead consumers to

feel empowered, providing them with

greater satisfaction, confidence and

sense of accomplishment. This is the

formula for Sherpa brand success:

ensuring that an individual feels

emotionally rewarded at the end of

their journey.

1211

WHAT IS THE JOURNEY?

Navigating a supermarket has never

been easier than with the SK Telecom

Smart Cart, which provides up-to-the-

minute alerts on product availability

and coupon information. Customers

input their grocery lists at home on a

corresponding smartphone app and

sync the phone with the cart once

in-store. After it is synced, the cart

tailors a shopping experience and

route to the customer’s list of needs.

HOW DO THEY PROvIDE

KNOWlEDGE AND INfORmATION?

Along with location-based technology

that shows consumers special offers

based on where they are in-store, the

app and tablet on the cart offer tips

and product information.

WHAT ARE THE

EmOTIONAl BENEfITS?

The combination of the mobile

app and in-store Smart Cart help

make shopping a less stressful

and time-consuming process.

They empower the consumer to

take control of the experience,

feel satisfied with their purchases

and focus on other priorities.


fidelity helps clients plan financially for

their futures by connecting them with

investment solutions that best fit their

income, life stage and risk tolerance.

It provides extensive information on

the status of the financial sector and

guidance on where consumers have

opportunities to develop their specific

portfolios.

HOW DO THEY PROvIDE


fidelity provides investors with peace

of mind and guidance at every level –

from one-on-one conversations with

investment professionals to powerful

DIY financial planning tools and research.

They guide investors to the appropriate

investments depending on their short-

and long-term goals and for their lives in

general. The focus is on an individual’s

“Personal Economy” because fidelity

recognizes that money management is

just one part of the whole picture.

WHAT ARE THE

EmOTIONAl BENEfITS?

The brand takes the overwhelming world

of finances and breaks it down in a way

that is understandable, providing support

via investment professionals, online

resources and calculators that help each

user navigate his/her personal situation.

Users are empowered with knowledge

and the ability to take control of their

investment choices.

fidelity Investments is among

the most diversified financial

services companies in the world,

offering a full range of investment

solutions for individual investors,

employers, institutions and

intermediaries. Their mission is

to help guide customers and

clients to achieve their financial

objectives, as manifested by

“the green line.”

Source: fidelity Website

1413

In 2011, Korean telecommunications

company SK Telecom launched a

pilot program in China that features

a geo-tagged “smart” shopping

cart that simplifies the often

arduous chore of grocery shopping.

It streamlines the process by

helping consumers map out the

most efficient way to check things

off their list and provides special

offers in real time.

SHERPA BRANDS

IN ACTION

Source: SK Telecom Press Release


The job search journey can be

overwhelming given the multitude

of ways to connect with companies

and get information. monster helps

individuals home in on their goals and

map out clear steps to get to their

dream job from where they are now.

HOW DO THEY PROvIDE


“Career mapping” is a tool that

enables users to visually see the

steps that lead from their current

role to the career they want. The tool

also provides information on turnover

statistics in specific industries and

the backgrounds of people who

work in them. “Career Snapshots”

is another offering that supplies

in-depth information about what

careers in different fields look

like. “Career Benchmarking” is a

social tool that lets users compare

themselves to others in their industry

and career stage.

WHAT ARE THE

EmOTIONAl BENEfITS?

Users experience not only the

satisfaction of finding an opportunity

that matches their experience

and interests, but also a sense of

accomplishment every time they get

a step closer to their goal on the path

that monster helped them build.

How Sherpa Brands Are Delivering

Across Industries

How Sherpa Brands Are Delivering

Across Industries

“They help tailor a plan that is in

my budget and gives me the

coverage that I need.”

INSURANCE

APPARELHEALTHCARE

(U.S.)

“Recommend from knowledge

and experience the products

that are best for me on a

personal level and allow me

the choice to make the final

decision after hearing their

advice.”(U.K.)

(CHINA)

(BRAZIL)

(U.K.)

“Provide clear and concise

information about what their

product is, the ingredients,

and how to use products.”

DRUGSTORES

AUTOMOTIVE

”They have trained

professionals who give us

the information we need.“

“They provide the

choice and profes-

sional suggestions.”

EDUCATION

“Empowers me with

knowledge that

leads me down the

right path.”

(U.S.)

Q: What are brands doing well?1615

monster allows people to find job

listings that fit their interests and

career goals by consolidating all

the listings in one place and

making them easily searchable.

What sets monster apart as a

Sherpa brand is its “Career

mapping” tool, which provides

step-by-step guidance for users on

how to get to their ideal career.

Source: monster.com

Q: How much do you trust brands that help guide you to the decisions or choices that make the best of your daily life?

Q: How does a brand that helps guide you to the decisions or choices that make the best of your daily life affect your relationship with the brand?

17

Sherpa brands offer benefits that make consumers’ lives easier, which ultimately drives stronger affinity, loyalty and business.

most consumers are more likely to trust and be loyal to brands that guide them to decisions that make the most of their time.

SHERPA BRANDS WIN

U.S.:

U.K.:

18

A WINNING SHERPA BRAND

By living up to its motto, “Improving

Home Improvement,” lowe’s proves

why Sherpa brands win. Geared

primarily to the do-it-yourself home

renovator, lowe’s success is contingent

upon its ability not only to offer quality

products at good value, but also to be

a trusted advisor throughout the home

renovation process, from start to finish.

To help achieve this, the company has

created a wide-ranging series of tools,

including mylowes, which is a

personalized online utility that aids in

the planning of future projects and

pinpoints specific products needed to

complete the job. It also provides a

history of purchases, making it easy to

track everything bought in one location.

lowe’s is enhancing the brand

experience by expanding its service,

while providing customers with a

sense of accomplishment as they get

the right products to successfully

complete home improvement projects.

from a business perspective, the

brand has also increased the average

basket size of customers and the

number of times they shop at the store.

lowe’s actions as a Sherpa translate

to concrete, tangible increases in the

bottom line.

lOWE’S

Source: lowe’s Earnings Call, 2012

OVER 14.5 MILLION CARDS

HAVE BEEN ACTIVATED

4 MILLIONOVER

CARDHOLDERS HAVE REGISTERED

THEIR CARDS ON MYLOWES.

REGISTERED USERS SPEND MORE WITH LOWE’S OVERALL

In fact, they transact more

often and the spend per

transaction is greater than

that of those not registered.

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

REGISTERED

NOT REGISTERED$

$

According to Lowe’s, since it

launched MyLowes in 2011:

2019

HOW TO BECOmE A SHERPA BRAND

There are seven actions that a brand can take to become a Sherpa brand. from understanding the customer’s journey, to providing them with the right tools and support that exceeds their expectations, to enabling them to celebrate their achievements, Sherpa brands must act not only as a guide, but as a trusted partner and champion as well.

Understand the

Customer’s Journey

Establish Your Expertise

Enable Customers

to Celebrate Their

Achievements

Live up to

Your Promise

Exceed Customer

Service Expectations

ENERGY BAR

Empower Customers

with the Right Tools

Offer Functional and

Emotional Support

SHERPA

TOOLKIT

2221

UNDERSTAND THE CUSTOmER’S

JOURNEY

Before your brand can truly guide, you must understand your

customer’s journey or path. Where are they trying to go? Ensure

that you understand the customer’s journey in order to answer

these questions and provide meaningful solutions.

ESTABlISH YOUR

ExPERTISE

Once the journey is identified, reflect on the value and expertise

that your brand provides when guiding that journey. Position

yourself as a thought leader in that area and offer information

that can help educate consumers and demystify the process.

24

THE SHERPA BRAND TOOlKIT

U.K. breastmilk replacement brand SmA

Nutrition understands what new moms are

going through. SmA provides emotional

support regarding concerns about the use

of substitutes for breastmilk and helpful

guidance and advice on baby care at key

stages. Additionally, customers can access

extensive resources for each phase of their

journey, including a live hotline, mobile app

and know-how help sheets and videos.

Apple “geniuses” are knowledgeable problem-

solvers for customers in the process of

purchasing, using or maintaining the brand’s

products. By providing accessible information

about complex questions related to technology

and troubleshooting, the “geniuses” offer

understandable solutions that put consumers’

minds at ease every step of the way.

90%of Genius Bar customers

are satisfied with the service

60%of consumers overall

would return to a store

after a positive customer

service experience

Source: NPD Group, 2012

90years of experience

understanding the

journey of new moms

Source: SmA Nutrition Website

23

EmPOWER CUSTOmERS WITH

THE RIGHT TOOlS

Greater value is something consumers look for in any brand.

However, from our survey, we also found that consumers prioritize

more information, solutions and expertise from brands to help

guide decision making. In addition, while Sherpa brands help guide

consumers, it’s important to remember that consumers want

to remain firmly in the driver’s seat. A good Sherpa brand helps

consumers navigate through decisions and encourages them along

their journey, but also allows them to revel in their achievements.


Progressive provides effective and easy-to-use

guidance for customers through an array of

online and mobile tools that compare prices on

insurance and offer discounts for good driving.

These tools simplify the confusing process of

understanding and choosing car insurance.

After purchasing a Hellman’s product at a St.

marche grocery store in Brazil, customers

receive a personalized recipe at the bottom

of their receipt that uses what they purchased

that day as ingredients for the dish. These

suggestions enable Hellman’s to promote usage

of its products while guiding the customer

to cooking decisions that take advantage of

resources they already have.

Over

1 mIllIONpeople have tried

Progressive’s

Snapshot tool

Source: Progressive Website

Sales increased

44%in the first

month alone

Source: Hellman’s Press Release

2625

OffER fUNCTIONAl AND

EmOTIONAl SUPPORT

Your brand needs to do more than fill a need; it must also connect

on a deeper, more meaningful level. Sherpa brands are considered

trustworthy, high quality and reliable, and consumers who interact

with them feel satisfied, confident, rewarded and empowered by

their purchase.

lIvE UP TO

YOUR PROmISE

When it comes to values that consumers look for in brands,

trustworthiness, reliability and functionality are most important.

Your brand must deliver on all three in order to win consumers’

loyalty. Trustworthiness is especially important, as every mountaineer

wants to feel confident in their guide before starting the ascent.


Weight Watchers, at its core, understands

the often difficult journey of weight loss. The

program recognizes the need for a trusted

partner along the path, and, above all, aims

to ensure its customers know they have a

strong support system that they can engage

via group meetings, a point-based weight-loss

toolkit and versatile apps.

As an online financial services provider,

mint.com handles millions of people’s sensitive

account information and has built a strong

reputation for protecting this data, solidifying

consumer trust. The service aggregates all

of a user’s accounts into one place, analyzes

spending to help identify opportunities for

savings and provides tools for setting goals.

Weight Watchers

customers lose

3xthe weight of a person

in a self-help program

People who lose weight

with other people are likely

to lose more weight

than on their own

Source: JAmA, 2003 and Obesity Journal, 2012

America’s #1personal financial service

provider with

10 mIllIONusers since launching

in 2007

Source: mint.com

2827

ExCEED CUSTOmER

SERvICE ExPECTATIONS

Your brand needs to have a strong foundation of knowledgeable

staff and accessible customer service along with open channels

of communication. How a brand interacts directly with a customer

is often a “make or break” moment in consumers’ minds.


The “Barclays Connector” tool enables small

business owners to talk to others in the same

position and get authentic guidance from a

peer who has gone through the same process.

Through this feature, the company is crowd-

sourcing quality customer service that is

relevant to its account holders.

The card company has tapped into extensive

data about its customers to provide the best

and most tailored service possible worldwide,

24/7. When a customer calls, the service

representative sees deep background

information on the customer, including payment

patterns, in order to identify unscripted,

personalized solutions on the spot.

Grew at 3% CAGR

from 2009–2011 to have

785,000business accounts

in the U.K.

Source: Barclays Annual Report

#1in customer satisfaction

among all U.S. credit card

companies in 2012 for the

6th straight year by

J.D. Power and Associates

Source: J.D. Power and Associates

3029

ENABlE CUSTOmERS TO CElEBRATE

THEIR ACHIEvEmENTS

The best Sherpas guide people up the mountain, but let them enjoy

their achievement once the summit is reached. Your brand should

do the same. Empower and reward consumers along the way, but

emphasize that the goal was achieved by them alone.


Nicorette emphasizes celebration of the little

steps that enable people to quit smoking

one cigarette at a time. The brand celebrates

achievement by chronicling every smoke-free day

and every dollar saved throughout the journey.

It also offers personalized advice and support to

quitters during the process.

vW is helping consumers in China celebrate

reducing their carbon footprints via the “Blue

mobility” smartphone app. The app makes it

easy for users to track and analyze their driving

behavior, access tips on curtailing fuel usage

and earn points toward an “eco-score” for

eco-friendly driving. When the app was first

launched, users could also compete via points

earned to win a trip to los Angeles.

Participating in

Nicorette’s Committed

Quitters program and

using the product

DOUBlESchances of success

Source: Nicorette Website

1.1 mIllIONdownloads, with

5% less fuel used

Source: volkswagen Website

3231

3433

ClOSING THOUGHTSToday, we see a number of values on the rise. People are looking for more control, prioritization, practicality, optimism and stability. But in today’s complex world, with its overwhelming amount of information and choices, people are demanding more guidance to help them achieve control, focus on their priorities and make better decisions for themselves that ultimately make them feel happier and more stable.

This demand for guidance has resulted in the emergence of Sherpa brands. Sherpa brands go further than just helping people navigate and simplify the decision-making process. Equally as important, they help people celebrate their accomplishments and goals throughout their journeys. This allows brands to play a more meaningful role in the lives of their customers, which results in greater brand trust and loyalty.

In a world where brands are trying to differentiate themselves and create stronger relationships with consumers, Sherpa brands are both the trusted partners that consumers rely on as they navigate through their journeys and the champions that celebrate consumer accomplishments along the trek.

ARNOlD STRATEGIC INSIGHTS GROUP

Arnold On is brought to you by the Arnold Strategic Insights Group. This edition is based

on the results of a global online survey of 2,400 adults conducted in December 2012 on

general attitudes and behavior, as well as on secondary research.

The Arnold On series provides analysis and consumer insights across a variety of topics,

and discusses their impact on how marketers communicate with consumers.

The content of this edition of Arnold On was developed by laurie Pocher, vP, Director,

Business Strategy; li Zhou, Analyst, Business Strategy; Sean O’Neill, vP, Director of

Business Strategy; Neela Pal, managing Partner, Global Director of Brand and Business

Strategy; and Brad Woodard, lead Designer.

If interested in further discussion or a workshop, please contact us:

lisa Unsworth

Chief marketing Officer

[email protected]

617.587.8242

35

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ATEGIC INSIGHTS G

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ArnoldOn: Sherpa Brands-Guiding Consumers to New Heights