What modern brands can learn from Häagen-Dazs

How to use value innovation to grow in a saturated market

In the 1960’s in the Bronx, two Polish-Jewish immigrants, Reuben and Rose Mattus, created Häagen Dazs.

The Mattus’ knew they were entering a saturated ice cream market. Their strategic focus wasn’t to outcompete the existing ice cream brands, but to make them irrelevant by creating a fundamentally new and superior value in the market.

This new and superior value was social and cultural aspiration. Häagen-Dazs’ European-sounding name gave cultural biography to the brand that didn’t have any. It turned a mundane product into an aspirational one by enriching it with the connotations, associations and references linked to its name.

Aspiration is buyer value. In case of Häagen-Dazs, it lends the buyer a sense of discerning taste that was once restricted to social and cultural elite. Häagen-Dazs name conveys sophistication, tradition, heritage and the old-world artisanship. Its original packaging featured a map of Denmark, despite the fact that “ä” doesn’t exist in Danish and that the words don’t mean anything. Häagen-Dazs shifted consumer preferences and created a market for itself around this aggregate consumer demand.

Value innovation redefines growth. It moves the growth strategy from “what are my competitors…