What Did a Strong BrandEver Do For Anyone?
Let’s quickly define the term "brand". It's not your logo. It's not your company's story or personality. Rather it's a feeling. A feeling your customers — indeed all the people who are even aware of you — have about you. If that's a little vague, let's do a mental exercise. Think about Kobe Bryant. What are your immediate impressions? That’s his brand. Now think about Pope Francis. That’s his.
A brand has value. You might not think a collection of feelings about your company has value, but it does. And the stronger those feelings get (provided they're positive of course) the more they're worth. Because feelings manifest themselves in concrete ways.
For example, profit margin. Not far from where I'm sitting is a Panera Bread. Down the street is an independent bakery the name of which, I confess, I don't even know. Both have cinnamon rolls, but the ones at Panera cost over twice as much. Are they twice as good? Nope. But the brand is stronger which means consumers are willing to pay more for them.
Repeat business is another way strong brands translate to real-world profit. McDonald’s is the classic example here despite their recent troubles. Yes they have sky-high visibility, but that visibility wouldn't count for much without their laser-like focus on their core brand promises: product consistency, kid friendliness, safety and cleanliness.
Did you know that strong brands have lower costs of sales? They do. That's because they have more leverage over suppliers, who always want to hitch their wagons to rising stars. Not only that, their promotion and customer-acquisition costs are lower because customers are willing to spread the word about them, free of charge.
You've probably surmised by now that strong brands are also more resistant to competition, and that's true too. Once a company stakes out its brand turf it’s tough for competitors to make inroads. Would you like to go head-to-head against Nike as a startup sportswear producer? Even if your shirts were cheaper, most consumers would still be willing to pay more for the one with the swoosh.
Lastly, strong brands attract better employees. A great brand is like a charismatic person. People just naturally want to be associated with it. And if you were thinking that strong brands have higher employee retention for this reason, you’d be correct.
One last thing I’ll say about brand — and it’s more than a little disturbing — is that you don’t own yours. Not completely anyway. Mostly, your brand is public property, which means it's not what you say it is, it’s what other people say it is. Which means it’s one thing to develop identities, positionings and mission statements. It’s another to actually live them.