As a business counselor for our local Small Business Development Center (SBDC) and a small business mentor for the Service Corp of Retired Executives (SCORE), I have noticed an increase in the number of questions I get related to branding.
I usually begin any discussion about branding by asking my clients “What is branding?” What I often hear is a list of marketing-related things like logos, websites, and taglines which are the more visual or tangible elements that contribute to a brand. Of course, this is an incomplete definition of branding. Branding by my definition is “Creating a positive opinion in a person’s mind when hearing your name. Be it your name or your company’s name or its branded products.” Simply put, branding is your reputation.
The advantages of having a great brand reputation in your industry are numerous. It allows you to charge more, to spend less on advertising, it creates loyalty that you can leverage, and it creates gravity for customers, employees, and the media.
When it comes to any discussion about branding, we need to understand that there are two types, personal branding, and business branding.
Personal Branding
Personal branding has received a lot of attention as of late and is growing faster because of the Internet. Personal branding is important for businesses where the founder or owner is the primary face of the business.
One of my current clients is a family counselor and is developing an online training program to teach parents how to deal with out-of-control children. She is the brand for her company and is well respected in her industry. Anyone doing due diligence on her program is likely to enter her name into a Google search. What they will discover are lots of results connected to her personal brand.
Personal branding gives anyone the chance to create a personal brand using their skills, personality, and expertise to solve other people’s problems. Like it or not, everyone has a personal brand. The real question is “Are you taking full advantage of your personal brand?”
Personal branding is important in recruiting as well. Not long ago, I was sitting on a panel for transitioning soldiers, sailors, and airmen from a life serving in the armed forces to the civilian world. Many of my cohorts were discussing how to write a resume to get a job. When it was my time to speak, I asked one simple question “If I Google your name, what would I see?” The room went silent. I then added, “Google is the new resume”. Essentially, I was trying to convey the value of having a personal brand.
In business, you need to have a personal brand. You want to create awareness that you exist by having a large network and then have the information on the Internet to back it up when a prospect Googles your name.
Business Branding
Business branding is what most people think about when they hear the term branding. Business branding is how your customers recognize and experience your business. Like personal branding, business branding is your reputation in your industry. When you think about business branding, it is more than just your marketing materials and advertising such as your logo, tagline, and website. Business branding is reflected in everything that your customer can see and experience such as your customer service, uniforms, community involvement, social media presence, etc. If a customer can see it or experience it, it’s part of your branding.
How to Build a Brand
The simplest way to build a brand is to deliver benefits to your customers. That said, building a brand takes time because you have to develop a level of public trust related to your brand. Remember, your brand is your reputation.
One way to build trust is to offer a no-cost option to allow the prospect to feel comfortable with your brand before you go for the sale. The more value in the form of no-cost or low-cost offerings that have great value for the customer, the more of a go-to resource you will become in the eyes of the customer. The more trust you can build with customers, the safer they will feel in buying your paid premium offerings. Your goal is to create a promise of quality and satisfaction that the customer will believe. The more you live up to that reputation, the stronger your brand will be.
Brand Value
There are many advantages to having a quality brand reputation. Here are a few of the most common.
What Business Buyers Aquire
A well-established brand is a valuable asset and is often what a buyer of a business buys when they acquire a business. I’m reminded of that scene from the movie Tommy Boy where Ray Zalinski wants to buy Callahan Auto not for their products but for their reputation of building quality parts.
Your name and reputation are more valuable than your inventory since you can replace your inventory but rarely can you rebuild a tarnished brand. It takes a lifetime to build a quality brand and a second to destroy it.
Reduces Advertising Costs
Why are brands valued so highly? One reason is that with a good brand you do not need to spend as much on marketing and sales. When you have a quality brand, you do not have to ask the customer to do business with you because your reputation for quality and satisfaction precedes you.
For example, how often do you see ads for Amazon, Starbucks, or Google? The reason is that we are all well aware of their reputation to deliver on their promise.
You Can Charge More
Moreover, when your brand has a good reputation, consumers are willing to pay more for it. Omaha Steaks has a well-known brand name; as a result, it charges more per pound than your local supermarket or butcher for the same cut of meat. Oakley and Ray-Ban charge more for a pair of sunglasses than Armani Exchange because of their brands’ reputation. The only difference in most cases is the name and the promise that the brand brings with it. Also, top brands feed into the concept of conspicuous consumption where consumers are willing to spend more money on goods or services in an effort to convey a higher social status or invoke envy in others to gain their respect. As a result, trusted brands see higher profit margins so the brand actually creates greater profitability.
Creates Loyalty
Great brands create loyal customers as well. With a good brand, a company can launch a new product line under the same brand name and customers will be inclined to use these new products. For example, let’s take a look at Coke Cola. Coke is a trusted brand. It has used the reputation it developed with consumers to introduce many line extensions such as Coke Zero, Vanilla Coke, Cherry Coke, and others. In fact, Coke has even introduced an energy drink line, leveraging its Coke Cola brand’s reputation.
Creates Gravity for Customers, Employees, and the Media)
Brands create a kind of gravity that not only sucks in new customers but also makes it easier for quality brands to recruit new employees. As your brand gains visibility, it attracts more influencers who quote or link to your content, creating free advertising. Your brand becomes a go-to source, further growing the brand.
Branding Summary
So, in conclusion:
Branding includes both individuals and companies
Branding involves building trust and the best way to start is to offer something free before going for the sale
Your brand is your most valuable asset
Brands create loyalty and awareness
It is very difficult to rebuild a tarnished brand
Strong brands need to spend less money on marketing and advertising
A brand’s reputation allows it to charge higher prices which equals higher profitability
A quality brand makes it easier to attract high-quality employees
Branding makes you a go-to resource to the media, which equals free advertising
