4 Compelling Reasons to Invest in Your Brand
Back in the day when there was only one brand of milk for sale at the local store, branding wasn’t so important.
Today, when we have an unprecedented number of choices, branding is everything.
As consumers, we are bombarded with so much information and so many messages, that in order for something to stick out, it has got to be something that speaks to our challenges and desires. Something unique and tailored just for us.
The best brands don’t shout at everyone from across the room, they engage meaningfully with the right people at the right time. They unapologetically and unwaveringly know exactly who they are, what they do and what they believe, and stick to it. They build a strong following based on their differences, not on their similarities. As Seth Godin puts it –
"In a crowded marketplace, fitting in is a failure. In a busy marketplace, not standing out is the same as being invisible."
Here's the scary reality —some businesses never 'make it'. And often, it's not because their offering is subpar. It's because they aren't able to stand out and attract loyal customers. They get by competing on price. They don't have the customer base to change tack when the market changes, or they waste money on marketing without a clear and compelling brand message.
Building a business is hard work, and chances are, thinking about your brand strategy isn't at the top of your to-do list. But honestly, it's probably the most worthwhile investment we ever made in our business.
Here are 4 reasons why I think branding should be moved up your list, pronto.
1. Strong brands command higher prices
The biggest incentive for businesses to invest in branding is that it enables them to increase their profits by charging higher prices. The process of branding helps you to understand the unique value you offer so that you can define your business in a way that makes it different to others. Its ultimate goal is to positively influence consumer perceptions relating to the quality, value and trustworthiness of your brand.
Brand perception is a huge driver of price. You’ll know this to be true if you’ve ever dished out more for a new iPhone, Sony stereo or even a Coke over a lesser priced, lesser known product. We will pay more for a brand because of its perceived higher value and lower risk.
Because price directly impacts profits, actively building a brand can boost your business’ bottom line.
If you think you’re selling a commodity or that your customers are far too price conscious, take a moment to consider the $100 billion bottled water industry— they have taken something that is incredibly abundant, put it in a bottle and charged up to 1000x the price of tap water for it. I would be very surprised if you’ve never bought bottled water. Now tell me this—have you ever bought Evian or Pump instead of the 80c generic supermarket brand? If you have, you’re not alone, but it definitely wasn’t a rational decision. But that’s the power of a brand.
The thing I love about branding is that, whether you’re a one person team or a huge corporation, it has the ability to boost profitability. Defining your brand doesn’t necessarily require growth, mass marketing or huge budgets. When it comes to branding, size doesn’t matter.
If you can positively influence customer perceptions about your brand value, you can charge a price that reflects this value.
2. Strong brands provide strategic direction
Say ‘strategy’ and you can almost hear the collective yawns of everyone reading this. Strategy isn’t a very sexy topic, but it is essential to have a plan of attack in knowing what goals you are trying to achieve, and how you aim to get there.
Your business decisions aren’t just made off the cuff. They are (or probably should be) aligned with a bigger overarching strategy.
Your brand strategy should sit alongside your business strategy to answer strategic questions like:
- Who are our best customers?
- Where should we invest our marketing dollars?
- What should our website say?
- Who should we hire?
- What kinds of opportunities should we be pursuing more of?
These business questions are a lot easier to answer if you already have clarity about your company purpose and vision, your preferred customers, your core offerings and the values and methods by which you operate. Get the foundation right, and your business decisions will be breezy.
3. Strong brands build a strong community
What do your brand affiliations say about you? Can you picture the types of people who would:
- Own a Volvo vs. a Porche?
- Watch the ABC vs. Channel 9
- Own an iPhone vs. a Samsung Galaxy?
- Listen to Triple J vs. Austereo
- Own a Fender amplifier vs. a Marshall amplifer?
- Own a Harley Davidson motorcycle vs. Honda motorcycle?
- Own a Pottery Barn sofa vs. an Ikea sofa?
- Own a Chanel handbag vs. a Target handbag?
Brands can be a status symbol amongst like-minded people and communities.
We associate ourselves with brands that outwardly express values and ideas that align with who we are or who we want to be.
You might think, not me! I am not loyal to any brand. But, if you honestly look at the car you drive, the media you consume, the gadgets you own and the clothes you wear, each says something about you and the communities you belong to—whether that’s Kmart, Harry Potter, Triple J or Apple.
4. A strong brand allows you to pivot
Are you confident that your products and services will be exactly the same in 5 or 10 years time? Businesses need to be agile and adaptive to be able to pivot in response to market changes.
When you build a brand, you become known for more than your products or services, you become known for your purpose, your vision, your people and your processes. These are all aspects of your business that can be applied to any product or service that you might sell now or in the future.
Consider some brands who have pivoted their offerings by using their brand as leverage. Through her strong brand, Oprah was able to pivot from her TV show to successfully launch a magazine (O:The Oprah Magazine). Similarly, the Virgin brand has lent itself to all sorts of brand extensions, from airlines to telecommunications, and Apple has evolved from selling computers, to selling mobile phones, tablets and digital media players by using their strong brand.
If your customers have a relationship with your brand, not just your products and services, they’ll be more likely to support your business, even if you change tack or extend your product or service lines. This is because they believe in how and why you do it, not just what you do. Having this tribe of true fans will make your business a lot more resilient to market changes.
Defining our brand was the best thing we ever did as business owners. It moved us out of our awkward, people pleasing teenage years and helped us to figure out what we believe in and value, who we want to serve and who we don’t. It helped us to define our ‘why’, find our difference and refine what we do and what we don’t do.
It’s hard to stand out, build profits, engage your customers and know where to invest your dollars without first knowing your brand.
Take the time to understand how your customers perceive you, and then get to work on deciding how you want to be perceived. Once you know where you are, and where you need to go, deciding on a path forward will be a lot easier.
Your next steps
You might have read this article and thought I'd love to work on building my brand but what does that look like? I have no idea where to begin! If that's you, then make sure you download our free, step-by-step brand checklist.
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