Why is Branding Important?
Brands are entrenched in every aspect of our lives. Branding shapes purchase decision-making, and we form relationships with brands, whether that’s a consumer, industrial, or business brand. It’s easy to think about brands such as Apple, Google, or Microsoft. But what about GE, Siemens, IBM, Accenture, SAP and Intel? What do these brands all have in common? Why are they so effective? They have built up worldwide recognition, loyalty, and success based on their reputations.
First, What what is a brand? A brand is more than a logo. A brand encompasses the physical products and services associated with a company as well as how the company is perceived in the eyes of its customers. It is built from a company’s identity system, core values, people, processes, systems and technology, and its product and service offerings. So while your brand exists objectively as a physical asset, it also exists subjectively in terms of the perceptions clients hold of who you are and what you represent.
Why is this important? A strong, effective brand affects behavior towards the brand and ultimately, business performance. Businesses and consumers want to spend money and buy products and services from a company brand that delivers on its promises consistently and fulfills their wants and needs. By putting time and effort towards branding, the result is brand equity (value). To show how important this is, look at Coca-Cola. Their market value is currently $194 billion. It is estimated that its physical assets make up only 50% of that valuation, with the remaining 50% coming from its investment in branding. This shows the significant impact branding can have on your bottom line.
Initially, we may think branding is only important for consumer products and services (B2C), however after careful analysis, we see that branding is also critical to business-to-business products and services (B2B).
Think about the representation of core values that are important to both B2B and B2C brands: trust, ethical behavior, friendliness, warmth, professionalism, honesty, integrity, value-for-money, esteem, good community citizenship, efficiency, effectiveness, intelligence. Differences become more present in the level, and sense of humor expressed and other emotions (luxury, sex appeal) in consumer vs. business brands.
In this recent example, SAP uses what may be viewed as historically consumer-driven sensibilities and dry humor coupled with high production values, to get its point across in this commercial created by BBDO.
Arresting, humourous visuals and comparisons provide the contrast effect and “shock” needed to drive awareness and interest in the sales funnel cycle. This has a lift effect across the sales funnel through to sales. This ad impacts the brand perception and personality—SAP is no longer a boring, dry IT company. It’s saying (as a company and brand) we have a sense of humor, can be relevant, arresting and human.
Branded Design, Product Features
In another example, RIM (now Blackberry) lost a war to Apple for a variety of reasons that included branding-as-product-design. Blackberry lost a form factor war (typewriter buttons vs. touchscreen). Further BlackBerry failed to anticipate that consumers — not business customers — would drive the smartphone revolution. BlackBerry was blindsided by the emergence of the “app economy,” which drove massive adoption of iPhone and Android-based devices. And, BlackBerry failed to realize that smartphones would evolve beyond mere communication devices to become full-fledged mobile entertainment hubs.
The lesson learned here is that business customers are also consumers (when they go home from work). Consumers and business professional preferred iPhones and touchscreens. This blurring of B2B and B2C lines affect how we must view branding and marketing strategy: there is an interconnection between the two.
Companies that promote commonly shared values and act accordingly succeed. In a B2B setting, the difference comes in the purchasing behavior and customer persona (group buying) and what these customers seek. The purchase decision is more involved, and the value of the purchase is higher than in consumer products typically.
Branding: Here are the top six steps to establishing a powerful B2B brand:
1. Conduct Market Research
Know your customers even better than they know themselves. Establishing ideas for your potential brand image is great, but you need to take steps to understand the needs of your target audience and who your competitors are and what they offer. Market research can take a whole variety of forms, from industry reports to surveys and focus groups, to social media. There are numerous vendors that offer research services such as Gartner, Forrester, and International Data Corporation (IDC). Importantly, market research lets you figure out how your brand fits into the overall market and how you can stand out. Clear differentiation is crucial to setting yourself apart from your competitors and finding that edge. With the insights gained from market research, you can find a niche to serve and develop strategies that cater towards that market segment, focusing on needs that may be underserved or unmet.
2. Determine your Brand Personality, Values, and Voice
Brands have personalities just like humans. Known as brand personality, human characteristics are often given to brands as a way to differentiate them. Thus, Apple is known as ‘innovative,’ or Google as ‘playful.’ These traits are then used to determine your brand identity, voice, behaviors, and experiences. For example, Apple, possessing the traits of creativity, innovation, and passion, has a brand voice that communicates these values in every advertisement and message it crafts. Although Apple is widely known for these values today, this was not always the case. Lacking a strong brand personality and image in the mid-1990s, the company was on a steady downward spiral. However, after adopting these distinctive traits that they are known for today, Apple successfully differentiated themselves from other technology companies, achieved greater brand recognition, and building themselves into their current $750 billion company.
The oil company, British Petroleum (BP), is another example of a company that established a strong brand personality that formed the basis for the actions it took. In 2000, BP launched a marketing campaign designed to attach them to the trait of environmental-consciousness. They changed their logo to a green and yellow flower, their slogan to “Beyond Petroleum,” and emphasized their investments in renewable energy. In the wake of the 2010 Deepwater Horizon oil spill when their brand personality was put to the test, BP adopted an apologetic brand voice and undertook a rebranding exercise to re-established their brand persona as sustainable and environmentally responsible. As a result, BP emphasized the positive efforts and impacts made towards recovery efforts in their press materials. They communicated its commitment in renewable energy.
3. Craft a Positioning Statement
Once you have determined your personality, a crucial aspect of branding is your positioning statement. This is where you communicate exactly who you are – what your market is, what you offer, and your differentiators. What do you want people to think of when your business comes to mind? What makes you stand apart or with the competition? Crafting a positioning statement is a core element of branding as it captures the essential parts of your brand and defines how you are different from other companies. Base your product and marketing decisions on a clear strategic position.
In the case of Avis, the #2 car rental company that competes head-to-dead with Hertz, Avis highlights that they are not #1 to their advantage: “Avis Car Rental is for business travelers who want express business services from a car rental company that eliminates wait times caused by leisure travelers. Unlike Hertz, Avis Car Rental is the only brand offering express business services because it is focused on meeting the needs of business travelers worldwide.”
Avis specifically targets business travelers and differentiates itself by emphasizing the unique services it offers that Hertz does not. Its positioning tagline “We try harder” is a values-based attitude that resonated with many customers, offering the brand promise of superior service. The tagline that launched an advertising campaign was hugely successful, helping the company turn a $3.2 million/year loss to a $1.2 million profit in a single year.
Focus and Clarity
Microsoft, on the other hand, has not held clear positioning. In 1994, it adopted the slogan “Where do you want to go today?” It later switched to “Your potential. Our passion.”
Then, it changed again in 2010 to “Be what’s next.” Finally, in 2014, Microsoft adopted “Empowering us all.”
These multiple changes of a tagline and arguably, strategic positioning, tend to confuse and prevent a clear and identifiable position among industry competitors.
Here are some only a few approaches to position a company (B2B):
• Global network
• Knowledge or domain experts
4. Establish your Brand’s Identity, Portfolio, Architecture, and Trademarks
Brand identity is the visual aspects of your brand. Think your name, logo, taglines, and any other cues that reinforce a particular image. The key here is consistency. Whatever your identity, reinforced it consistently across all your channels and materials. This strengthens your overall brand image and allows you to build deeper, more meaningful relationships with your clients.
For example, let’s take a look at Google. Its visually distinctive and highly recognizable logo, with its four vibrant colors, is a key part of its brand identity. It has stayed consistent across its product lines, leading to strong brand association and familiarity. Paramount to Google’s brand identity is its unique name, a play-on-words of the number googol.
Should you have multiple brands, managing and optimizing your brand portfolio is important. A portfolio consists of numerous brands that function to serve the needs of different market segments. Thus, determine the role of each brand relative to others and distinctively define its relationship and value to the whole portfolio.
Brand architecture is how you organize your brands and products to help people understand what you offer. There are various approaches you can take, from a monolithic approach (also known as a ‘branded house’), where your company brand is used on all your products and services, to a freestanding approach (also known as a ‘house of brands’), where each product or service is individually branded. Each approach offers both advantages and disadvantages depending on the industry and context.
Alphabet, the holding company under which Google falls, would be an example of a house of brands. Included in Alphabet’s brands and product lines is the core Google business responsible for search, maps, and apps, but also Google Ventures, Google Capital, Nest Labs, and Calico. Each of these brands operates for a different purpose and different target market. As this broad business umbrella serves diverse needs, this architecture structure works well for Google as a way to organize and set apart each of its brands. Contrast this to companies like Intel, GE, and HP, which all operate as branded houses. Their various product lines and businesses are all extensions of the master brand. This is often cost-efficient, and it better aligns their organizations both internally and externally.
Contrast this to companies like Intel, GE, and HP, which all operate as branded houses. Their various product lines and businesses are all extensions of the master brand. This is often cost-efficient, and it better aligns their organizations both internally and externally.
Finally, there are trademarks to consider. We often confuse ‘Trademark’ with ‘Brand.’ While your brand represents your overall public image and reputation, trademarks offer legal protection of specific aspects of your brand, such as your name, logo, tagline, color schemes, and symbols. These are identifying factors of your company that, taken together, determine the value of your brand in the marketplace. As such, they should have legal protection to prevent others from stealing them or creating similar marks that cause confusion.
5. Implement Design Standards
As implied above, elements relating to design are hugely important in branding. Your logo, typeface, shapes, and colors are critical elements that shape the image people have of your company. They should be consistent with the position you take and the brand identity you are trying to convey. Don’t think color is important? The University of Loyola found that color increases brand recognition by up to 80%.
A good tool to have is a style guide. Style guides ensure that quality standards of design are consistent and uniform across your various materials. This guide will help your content creators communicate consistent messages and ensure that everyone is on the same page when it comes to brand design details. Content guides ensure all of your written content follows the same standards, from terminology to tone to punctuation. These documentation tools enable consistency and high-quality communication throughout your entire organization, helping to drive brand recognition and maintain quality.
6. Deliver a Brand Promise
Finally, you need to come through for your clients and deliver on your brand promise. A brand promise ultimately links your purpose, positioning, strategy, and people. It is your way of connecting emotionally with your audience, outlining your unique benefits, and then delivering on those expectations. As such, your brand promise must be compelling, authentic, and consistently deliverable. It is important not to over-promise a benefit, creating expectations that you can’t fulfill. If we look once more at Apple, we see an example of fulfilling a brand promise. Apple’s brand promise to “think different” embodies the core of Apple’s approach to all its products and services. Since its inception, Apple delivered innovative products, and keeps its brand promise. Its customers come to expect this consistency.
A final point to consider is the need for ‘rebranding.’ Trends and ideas change over time, and your brand needs to change and evolve alongside them to stay relevant. For example, most people today associate Intel with bunny suits, outfits worn to protect microprocessors from contamination that have become synonymous with high-tech, advanced technology. But this was not always the case. These suits first appeared in Intel’s 1997 ads for its Pentium MMX processor.
Before this, bunny suits were relatively unknown by the generation population. However, with the addition of bunny suit-clad workers in its widely popular TV commercials, Intel managed to successfully rebrand itself as a highly innovative business technology company and extended itself into a consumer-oriented company with the Intel Inside ingredient branding program. This gives Intel an advantage in the business marketplace, as it drove consumer and business demand for its products better than its competition.
Remember, your brand is more than just your logo. Whether your company is B2C or B2B, design your brand to espouse It is your promise, personality, identity, symbols, unique processes, and voice of your company. It forms the connection between you and your clients, employees, partners, and the public. Powerful branding helps form strong relationships and creates long-term value for your company. Pay attention to and nurture all aspects of your brand, as the various examples by Apple, BP, Google, Avis, Intel, and others, show.
A powerful brand is a successful one but building a brand is not easy work. It takes time, energy, expertise, and creativity to foster and maintain your brand image. Al Leong gives you the tools to can help you create and build your brand, and develop a clear roadmap that leads to long-term loyalty and success.
- Co-authored by Kaitlin Somerville, Al Leong, MBA; Rand Group