Brand can be an elusive concept. Is it the company name and logo? The typeface and colour scheme it uses? The qualities we associate it with?
And though we could all name successful brands—examples of when these factors mesh successfully to create reputation, desire to buy, and loyalty—the exact financial gain of the brand’s success can be difficult to pinpoint. Though as we covered in our piece on ‘How to Measure Brand Equity,’ it is certainly possible!
And for the numbers-driven C-suite, it may seem less important than mapping monthly sales, quarterly budgets, or EBITDA. But with 2018 set to be the year that CMOs join the boardroom in ever greater ranks (as consumers become more interested in, and more able to influence companies’ reputations) it’s time that everyone in C-suite got serious about brand. Here’s why.
As the head of the company, the CEO is also head of what the company stands for. Getting in-depth knowledge of how your brand is perceived by the market is crucial. It allows CEOs to see where the company’s current reputation is: the first step in the journey to getting it to where you want it to be.
Because, at the end of the day, strong brands are infinitely more valuable. And, though it’s less neatly-quantifiable than other metrics, ultimately brand is hugely responsible for driving up the bottom line. Powerful branding influences consumer choice, drives sales, and increases shareholder value.
In fact, in almost any listed company’s annual report, ‘brand’ is often mentioned dozens of times, which we looked at in more detail here.
The correlation between strong brands and market performance is undeniable, and in a world where consumers are talking more to each other than ever before (mumsnet, tripadvisor, social media sites, and review discussions are all being used to advise on which brands to trust) the public’s perception of a company is key.
Better brand understanding illuminates where your sales strategy is working, and which demographics you’re failing to resonate with. It will tell you what messaging is being well-received, and what needs to change.
While these are topics at the forefront of your CMO’s mind, they impact market share, growth potential and shareholder value - meaning they should also be at the top of your priority list too.
Regular monitoring of your brand will give you a better picture of the company from outside its walls, so that you can work out how best to shape the internal workings.
Though not traditionally in their remit, the potential for a strong brand to optimise a company’s financial performance should make any good CFO get more excited about the potential of a strong brand.
The CFO of Deloitte, Pete Shimer is a big believer in this. He notes that the “financial value of the brand often exceeds any single asset class that appears on a corporate balance sheet and is a significant multiple of revenue and cash flow.”
The incentive-to-buy that a brand brings to a product, and the loyalty that strong brand performance can create over time creates healthier margins, and helps a company avoid commoditisation and pricing wars.
With 69% of people saying they would rather buy from a brand they know than buying the cheapest version of the product, the power that brand can have to insulate your company from price-cutting competition is enormous.
What’s more, by knowing your audience through regular monitoring of your brand, CFOs can minimise mis-selling and wasting money on subsequent ad campaigns that just aren’t getting through.
“Do you know why a particular promotion, campaign or product launch wasn’t as successful as expected, and how can we mitigate these risks in the future?,” ought to be a question every CFO asks when necessary. Now, thanks to a platform like Attest, you can get the answers too.
3. Chief Revenue Officers
Beyond just the revenue increases that a strong brand will generate, brand can insulate companies to downswings in the economy.
It was widely acknowledged that strong branding helped companies weather the late 2000s recession, and its a phenomenon we’ve seen recently with Tesco. The supermarket giant was in serious trouble back in 2015 (it reported a £6.3 billion loss) but managed to recover remarkably fast, largely due to its brand strength.
The leadership team decided to knuckle down and streamline their focus: they honed in on brand and promoted the idea that Tesco’s number 1 priority was its consumers. Their ‘Brand Guarantee’ and ‘farm brands’ were effective brand-value-focused campaigns; the push for branding on their delivery trucks increased visibility; and their recent Food Love Stories adverts have their key brand message (their focus on individual customers) at their heart.
Since crisis management often costs companies millions, it’s good sense to invest in brand. See it as a preventative measure: should a crisis occur, the defences will already be in place to minimise the scope of the damage, and save you money.
If you’re focused 100% on revenue (or growth), then it’s easy to see why a focus on brand can bring outsized rewards.
4. Chief Information Officers
With ever-increasing amounts of data, it’s easier than ever before to measure everything. But what about measuring your brand? Monitoring this data carefully to ensure your brand is healthy is a huge step towards differentiating yourself from the competition.
If you take your brand for granted and don't invest in it, there's always someone ready to steal your customers out from under you. Keeping an eye on where you’re operating in the market; tracking how and where people are talking about you; and understanding what they’re saying will give you a checklist of actionable insights needed to stay ahead.
5. Chief Marketing Officers
Since brand is traditionally the CMOs domain, it’s key that they understand the company brand better than anyone else. Central messaging—both internal and external—will be infinitely stronger if it’s cohesively on-brand.
The foundations of a strong brand are built in communicating how to sell your product. Successfully creating a distinctive reputation will make everything in your life easier, from customer acquisition to customer loyalty. Strong branding has been proven to have a direct positive impact on PPC, SEO, conversion and retention.
And with marketing in a period of exciting change, it’s more important than ever to know exactly what your company stands for. As CMOs begin to traverse a whole new host of technologies, in the form of upcoming AI, AR and VR technology, they need to be clear on their branding to work out how to translate their offering to these new platforms.
6. Chief Talent Officer
A strong brand that people believe in has a huge effect on company culture. Having strong brand values naturally drives purpose, which is widely acknowledged to be one of the key things employees seek from their job. Strong brand vision creates a sense of drive and meaning, in turn fostering a culture that employees will want to remain in.
A strong, meaningful brand can provide an answer to one of employee’s most-asked questions: “Why do I do what I do?”
This is more relevant than ever, as people spend more and more of their time at work and as millennials start to become the main contingent of the workforce (half of the US workforce will be a millenial by 2020). They are actively searching for jobs that offer more than just a salary, and a valuable brand can play a part in this.
Whether its feeling like their company’s brand pushes for innovation, or creates bespoke products enhancing people’s everyday lives, feeling a part of a mission is important to retain and attract new talent.
The advantages of building a strong brand are myriad. Brand touches on every single aspect of a company’s financial performance and needs to be properly measured, monitored, and tended to.
Brand building is no one person’s responsibility. Strong brand, by its nature, should be pervasive and all-encompassing. From internal comms, to external messaging, to strategy decisions, and financial metrics, brand is inevitably involved.
Is brand at the top of your executive agenda? And if so, how confident are you in the way you measure it?
If your company is ready to take the proper steps to managing brand the smart way, get in touch. We can create custom industry brand trackers to focus on your specific niche; or take things further and help you analyse market dynamics, consumer sentiment, competitive intelligence and more.
Talk to us today to learn how we can help you measure, manage and maximise your brand equity.