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                                                       Nine secrets of great branding
                                                       Author:
                                                       pg. 1 Dr Thomas Oosthuizen
                                                       2008
                                                       pg.2
                                                       pg.3
                                                       pg.4



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Nine secrets of great branding

Intangible yet instantly desirable, a strong brand can         What does your brand name say?
boost profit margins and keep customers coming back
for more. Yet, in order to deliver optimal results, branding   Sta-Soft captures the essence of what that brand does
must be built and managed on a strong foundation.              (it softens washing). Vodafone tells you exactly what the
                                                               brand delivers. Simple, direct names are good for brands.
As a brand owner, here are nine thoughts for successful
branding. By following these principles, your brand            As the clutter within the marketing environment intensifies,
stands a better chance of creating serious business            a brand name has a role beyond merely being a
wealth.                                                        shorthand or handle that encapsulates the ‘basket of
                                                               promises’ to a potential consumer. Today it has to
As competition gets fiercer and globalisation becomes          immediately make you sit up and take notice. Even if
the order of the day, more and more companies are              this means breaking the “rules” of expected or prevalent
seeing the brand as key to unlocking investor and              brand names, by using an unexpected name. Witness
business value. When capital expenditure in most               the effectiveness of a brand like Orange in the UK mobile
industries becomes prohibitive and the attributes of           phone market.
products within the same product class are parity,
branding can stretch margins, increase customer loyalty        2. Do your logo, colours and corporate identity
and boost profit.                                              create instant market impact?

By exporting a well-known brand into new markets,              Colours can make something stand out from the crowd.
instant incremental revenue is created, simply because         Just see how noticed BP became after it turned green.
of the brand’s strong identity and what it represents in       Compare how the red of Vodafone or Virgin stands out
the market. Place the brand boldly in new product              from their competitors. The red telephone of Direct Line
categories and the same increment follows.                     in the UK takes ownership of direct short-term insurance.

The more famous a brand, the clearer its customer value        The Apple Computer logo has become legendary as it
proposition, the better its chance of boosting company         breaks out of the clutter and catches the eye and the
profits. The truth is that a brand remains one of the very     imagination. You can always expect something novel
best multipliers of capital expenditure and investments.       from such a logo. It is even incorporated into how the
With fairly low input costs, a strong brand can be created,    product looks – an Apple product simply looks cleaner,
which in turn multiplies the return to shareholders. How       smarter and more modern than any other PC brand.
many other management resource applications are able
to do that?                                                    A great logo, like a great name, creates impact beyond
                                                               its investment. Not using these elements means you are
However, as marketers, brand custodians – even CEOs            entering the fray at a competitive disadvantage. A logo
– you must start and build your brands on fundamental          needs to add to the brand name, not complicate it: the
branding pillars.                                              swoosh makes Nike a brand name that stands for a
                                                               history of symbolism, without it, the name will mean a
1. Does your brand do what it says?                            lot less. Yet, you often find logo’s that have no significance
                                                               at all relative to the name of the brand.
A brand name is one of the most important decisions
any brand owner can make. It needs to be a cache that          3. Why should a consumer pick you over a rival
delivers instant recognition and cognition. The more           brand?
expressive of the consumer need, the more powerful
the name. Simple logic says if something has implicit          The degree of differentiation against competitor brands
meaning, you need a lot less marketing investment to           is key to the survival and success of a brand. Do you
establish it.                                                  know what your customers want and need? Even if the
                                                               answer is yes, what do you do about it?


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Nine secrets of great branding

Why your brand should be bought over a rival is one of        Service industries have coined the term ‘brand
the most important factors in branding. Sadly, it is also     experience’ to refer to the consistency of brand projection
one of the most neglected. Many brand owners can              across every single customer interface with the brand.
never answer, in a meaningful way, why their brands           If the service of a brand is bad or inconsistent, the
should be purchased against other contenders in the           advertising is nullified. No matter how good it is.
field.
                                                              Quality, consistency of touch-point and alignment of all
Can you in less than sixty seconds give a prospective         staff to a brand promise – all guarantee a thriving brand.
consumer a compelling reason to give you their business?      Weak delivery against customer expectations not only
                                                              undermines a brand, it can kill it.
No matter what your brand, it needs a simple, direct
and powerful customer value proposition. The basket           5. Does your brand deliver on its promise time and
of benefits must be clear in a matter of seconds. It must     time again?
show the consumer what they will get when they
purchase the brand.                                           A brand needs to be consistent in marketing wherever
                                                              and whenever it presents itself. Most global brands have
‘Omo is the strongest washing powder for the cleanest         been visible and salient in their respective markets for
wash’ – simple, direct, underpinned by a strong               years. There is a huge correlation between brand
competitive statement. A consumer knows immediately           credibility and awareness and the amount it spends on
and precisely what they will be getting when they put         marketing.
a box of Omo in their shopping basket.
                                                              That is why top brands show high degrees of consistency
In many product categories, differentiation between           in their marketing expenditure. Marketing expenditure
brands is vague and mostly do not even exist: the single      is as much an investment into brand awareness in the
most important reason for marketing should be geared          market place as it is a barrier to keep competitors out.
at adding differentiated value to the brand. And answer
the consumer question: “Why?”.                                The same applies to service levels and product quality.
                                                              Brand range has to be kept narrow because once the
4. Does your brand deliver real customer experience?          range gets too wide and variable, there can no longer
                                                              be talk of a brand. This is the very reason why some
The quality embedded in a brand is almost, if not more,       franchise ideas fail – the core customer value proposition
important than brand image and identity. Talk to large        is inconsistent, diluted and confusing.
brand owners like Unilever or Proctor & Gamble and
they will tell you that quality is the cornerstone of their   6. Does your brand stay ahead of the pack?
many brands. Their maxim: what goes into a brand has
to be the very best formulation and quality, everything       It takes a degree of innovation to keep a brand novel,
else is secondary.                                            exciting and relevant. If you want to stay a leading brand,
                                                              regular innovation is called for. Brands like Nokia literally
Ask why McKinsey has the best name in global                  see their market share wax and wane on the basis of
management consulting and the answer is likely to be          innovation in styling and functionality of product design.
“because they appoint only the best people”. Their name
and reputation allows them to make it to the top of the       Years back, Colgate dental cream lost market share in
shopping list for companies looking for serious               the toothpaste market, purely because it started lagging
management consulting services.                               in innovation. Every brand needs to be re-energised on
                                                              an ongoing basis. Gillette razors are always finding fresh
When the quality of what goes into a brand declines,          ways to improve and refine their products. And their
the market share soon follows. Brand image is important,      efforts have allowed them to dominate the global market
yes, but never at the expense of quality.                     with a wide margin.


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Nine secrets of great branding

The psychology of a consumer is an interesting thing.         To deliver on a brand promise everything needs to be
Innovation by other brands often makes consumers              aligned – people, systems, procedures, administration,
think that their own brand is now outdated and that the       infrastructure and distribution. Unfortunately, in many
more active brand is now the leader. It’s a mindset you       businesses, an outdated legacy system makes this kind
cannot afford to ignore.                                      of integrated thinking and implementation difficult.

7. What degree of margin can your brand demand?               9. Is your brand properly managed?

Strong brands require strong investment in product            You may be lulled into thinking that creating a brand is
quality, distribution and marketing. For this reason, a       enough. It isn’t. Once a brand is created, it exists outside
brand needs to sustain a fair margin to remain                of its owner within the public domain. What your brand
competitive.                                                  is and its core function, is dependant on its saliency in
                                                              the market.
The lowering of average industry margins often means
that an industry is becoming a commodity. This should         Here lies the major task for you the brand owner - to
start raising red flags for brand owners. Customers fail      manage this inherent brand wealth on a daily basis, to
to see why they should pay a differential price for any       optimise the brand wealth among key stakeholders and
one brand.                                                    consumers alike.

The degree of margin of a brand is often indicative of        Brand wealth needs to be continously created, monitored
its status and strength. Gillette, for example, sells for a   and measured. This is best done by understanding
large margin. In the airline industry, however, margins       consumer needs, being in touch with them, being aware
are much smaller as the average customer sees negligible      of current and new competitors and by carefully reading
difference between brands. Still, brands like Emirates        changes to stay ahead of them. A brand that stagnates
have a higher average customer yield than other carriers      or becomes complacent will eventually suffocate and
as they spend more on technology than their competitors.      die.
Starbucks can charge more for their coffee because
they regularly introduce new products and flavours and        Building on the nine basics
have designed an environment that is inviting, relaxed
and novel.                                                    In branding, imagination is as important as money. Yes,
                                                              some brands succeed because they rely on huge
8. Does your brand have the necessary back up in              marketing budgets, but other smaller brands have learned
place in order to deliver?                                    to become agile, innovative and clever in their positioning
                                                              with similar results.
A successful brand needs to be able to put its money
where its mouth is. Does your brand deliver on its            What does this mean? Good branding is one aspect of
promise? Do you have systems in place to assure               business that can easily be leveraged – by being smart
delivery?                                                     a brand can create wealth way beyond its input costs.




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Nine secrets of great branding

This is a strong acid test. In years to come it will be an   much wealth you’ve created in either the establishment
important yardstick in testing branding efficacy. As         or management of your brand. And today there are
access to communication tools like the Internet grows,       tangible ways of measuring this wealth.
novel brands will find it easier to make inroads.
                                                             Weak brands are an opportunity cost – the stronger the
The flipside is equally true. As customers become more       growth in the market, the worse the cost. The problems
aware, connected and conscious of developments and           Nedbank experienced as a brand over the last few years
trends, brands with a weak customer promise will simply      is visible in how competitive brands grew against them.
fade away.
                                                             No brand can afford this.
Creating and maintaining a strong brand is a challenge.
As a brand owner, you will be judged according to how




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