Tuesday, May 15, 2012

What is Branding?

“A brand is the most valuable piece of Real Estate in the world: a corner of someone's mind.”

-John Hegarty

So, what is branding?
In short, branding is the staircase on which a company can ascend from a household consumable to a household name.

It takes a minute to get the insight from the quote above, and it goes to the core of what branding is all about: When a consumer thinks about a product that you (and your competitors) sell, nothing is more valuable than your brand coming to their mind first. A brand name is an assurance of reliable quality, thus less perceived risk for the consumer.

This is the difference between a buyer doing a search on Google or Amazon for a “funny t-shirt” compared to going directly to your eCommerce website that sells funny t-shirts. If you own the term “funny t-shirt” in the consumer's mind, they go directly to you without seeking out competitors. Thus, branding reduces a customer's buying cycle!
Think of any consumer-related Fortune 500 company and the terms they “own” in their target market's minds: Walmart owns “cheap groceries,” Target owns “good value for fashionable home products,” Apple owns “easy to use connectedness,” Coke has been synonymous with “soda” for many years. Now, obviously you're not going to do a specific product search for “easy to use connectedness,” but when you want a new cell phone that is easy to use, you're going to get an iPhone (or whatever brand owns “easy to use connectedness” in your mind).
Branding is NOT just a logo and a catchy name.

A Small Business Example
It's the weekend and you, as a civilian, have nothing better to do, so you decide to go to an event for planting trees in your community. When you get there, you notice that a company called Jessy's Log Cabin-Building Tools sponsored the event. After the mild irony settles in, you find out that Jessy's Log Cabin Tools makes products mostly for people building cabins for themselves, and not for professional home builders. This compels you, since you've considered building a home for your family some day.

Interested, after the event, you decide to visit their website and find out more. You learn some fun facts about building your own log cabin. This, you think, would be even nicer than a regular home!

Over the next couple weeks, it seems like every website you visit has an ad for Jessy's Log Cabin Tools (retargeting). You finally click on an ad and start looking into the prices of tools and schools, and you seriously think about building a log cabin in the next year ($20,000 and an adventure vs. $250,000 and loud neighbors?).

When you are finally ready to purchase log cabin building tools and enroll in a two week course, you go directly to Jessy's website. The thought of searching on Google or Amazon for other products never even crossed your mind, even though you consider yourself a savvy customer.

Pretty awesome, right?

The Benefits of Branding at a Glance
  • Increases long term sales
  • Can give your brand immunity in tough economic times
  • Creates brand loyalty and repeat purchases
  • Reduces customers' buying cycle, both time and effort (good for everyone)
  • Eventually allows you to increase prices above competitors (consumers pay for trust)
  • Your brand equity increases (the value of your brand above and beyond your physical assets)

How to Build your Brand
So how do you keep your company at the top of your customers' minds? Easier said than done, but I have some practical advice:

Branding can be broken up into two categories: Pre-purchase and post-purchase.
  • Pre-purchase branding is more difficult and expensive, but can yield a higher value for your company in the long run; it includes brand awareness.
  • Post-purchase branding involves customer retention and loyalty. Both should be done simultaneously.
Tactics for Pre-Purchase Branding
  1. Work on your brand's story: Is it compelling enough to spread through word of mouth?
  2. Create a unique selling proposition that differentiates you from all competitors. (Very important)
  3. Begin or enhance Online Retargeting campaigns.
  4. Online Banner advertisements: Pay per impression rather than clicks.
  5. Social media advertising: Facebook ads, YouTube ads.
  6. Billboards in key geographic areas
  7. Niche blogging for customer discovery
  8. Community nurturing – giving back to a physical and/or digital community
  9. Social media contests
  10. Sponsoring events
  11. Putting on your own event
  12. Create a street team of Guerrilla marketers by asking your brand advocates to become involved in spreading your message, in return for free swag
  13. Measuring success:
    • Surveys both before and after the campaign
    • Visits trends to your site from a particular source or event
    • Brand mentions trends on social media and across the web
Tactics for Post-Purchase Branding
 (In addition to a lot of the same tactics as above)
  1. Newsletters
  2. Social media engagement 
  3. Facebook ads targeted only to current Fans
  4. Community building
  5. Online forums: Create your own
  6. Post-purchase customer service- Make a simple call and ask how they like it.
  7. Seek out brand advocates and reward them
  8. Send a thank you gift/letter for bigger purchases (these are really to reduce buyer's remorse)    
  9. All of the actions in the Pre-purchase section above will help reduce buyer's remorse. The more they see you, the more legit your company seems. 
  10. Measuring success:
    • Surveys both before and after the campaign
    • Visits trend to your site from a particular source or event
    • Brand mentions trend on social media and across the web

    Final Thoughts
    The brands mentioned in the first example (Coke, Apple, etc) are large, seemingly unattainable brands. They got to where they are by branding. But as a smaller company, you'll need to think about more specific terms that you can "own" in a customer's mind compared to the bigger guys. For example, before Mountain Dew took off, they targeted "hillbillies" (weird, right?). They didn't try to go after the general "cola" term that Coke owned. When they decided to change their image to become a drink for extreme sports fanatics (which is very specific), it propelled them to the large brand that they are today! They focused all of their marketing around extreme sports, and tried to be "the cola for extreme sports fans." They used "verbal nails" and "visual hammers" to lodge it into the mind of their target market. It was obviously successful since they are still using it!

    When you're actively marketing your company, consider a branding campaign while simultaneously marketing/advertising specific products and promotions. 

    I hope this helped. Feel free to comment with any questions, concerns, disagreements, or love!


    Richard Holmes said...

    This looks like a post rookie marketers who delve in buy and sell philippines should read, for additional info.

    Gwyn Stiles said...

    It was indeed very helpful. With all the competition going around, it's definitely a must to come up with effective marketing strategies to boost up your sales.