Don’t dismiss branding as a multinational phenomenon – Look at what they do, and adapt it to your SME situation – Cameron Cooper looks at the important steps in building a brand, and vehicles for promoting it.
If you think branding is not important for your business, consider this: Coca-Cola, the world’s most valuable brand, is worth US$69 billion, according to international branding consultancy Interbrand. Not bad for a fizzy drink.
Creating a strong brand is considered essential to the success of major corporations, but many SMEs put the issue in the too-hard basket. It’s too time-consuming, too expensive and too difficult, they say. Such a dismissive attitude may be a mistake because even the smallest business can benefit from greater market awareness and goodwill.
So, how can an SME build a brand from scratch? Dale Renner, a brand strategist and director of GSG Iconic, says branding must be treated like any other business asset-it requires planning.
“Often organisations get into trouble when they make decisions at the last minute or think about branding simply as an end result, such as the way their logo is designed,” he says.
A brand should be treated as a strategic tool that is integrated with an overall marketing strategy. Renner advises three steps:
First, identify the unmet needs of the market through research-that process may be as simple as asking friends or present customers about what they want-and work out the company’s sale proposition and how to communicate that to customers.
Second, develop a positioning concept. How can the business present a product or service that is different to competitors. For example, if there are five banana shops in your city, selling cheaper bananas may form the core of the brand strategy. “Branding mostly boils down to a process of differentiation,” Renner says.
Third, think about how to deliver that proposition and communicate it. A brand, Renner notes, is a “promise delivered”.
Carolyn Stafford, of Connect Marketing and author of the book Small Business, Big Brand, believes many organisations misconstrue what branding is about and focus on logos, names, colours and other physical attributes.
“They don’t pay attention to the soft, intangible parts of the brands. We really need to reverse the whole concept of branding and not look at it from a visual and physical context but from an emotional viewpoint and create a community around our brand.”
Stafford cites the Harley-Davidson brand, which is now about more than just motorbikes. “Their brand values are about freedom, rebellion, all those sorts of things.”
SMEs, she says, can also try to create a positive experience around their brand despite having fewer resources than multinationals. “It’s feasible for any business. For example, most businesses get their customers through referrals and word-of-mouth, so they have to provide a great brand experience. It doesn’t matter how gorgeous or sexy your brochures look or your logo or website.”
Stafford even suggests that SMEs should take their branding cues from large corporations rather than merely trying to emulate the campaigns of like-sized rivals. “Businesses need to do stuff that is different, and the best way is actually looking at businesses that are outside their area and the big brands that are doing it exceedingly well.”
McDonald’s, Microsoft, Google-it is hard to believe that such iconic business names were once unknown startups.
Tim Riches, managing director of FutureBrand, notes that a lot of today’s most famous brands started out as small concerns. While most SMEs will never reach the profitable heights of Maccas, the lessons behind their success should not be ignored.
“In many ways the whole branding thing is easier for an SME than it is for a large corporate,” Riches says. He puts this down to SMEs’ ability to seek out sharp, specific, individualistic concepts.
Creating a brand requires consistency, according to Riches. That means all elements of a company’s offering to customers must line up-brochures, website, advertising, service experience, products, media releases, you name it.
That doesn’t imply that a company should be a slave to its customer. Riches says a basic principle of brand management is that a business has to be true to itself rather than merely reflecting customers’ needs “because if all brands went down the path of merely reflecting customer needs, then everyone is going to be more or less the same”.
Brand names evoke great passion. Witness the perennial slanging match between Ford and Holden motorists over vehicles that are, for the most part, quite similar. Or McDonald’s versus Burger King.
Choosing the name of the business is crucial. Do you want the name to reflect the nature of your business (for example, bedding chains such as Forty Winks and Sleepy’s paint a picture of the business)? Do you want to exude reliability and respect (such as law firms Malleson Stephen Jacques and Gilbert + Tobin)? Or do you want to be quirky and attention-grabbing (like Crazy John’s and Nudie)? An appropriate name for a business can create an interesting brand around which an entire marketing campaign can be based.
Renner believes selecting a name is the most important element of branding. “Is it a word that is clear and understandable, is it very different from competitors, is it short, can I trademark it?”
In the era of the internet, websites must be factored in. Every word in the English language has already been registered as an URL, so you may need to search hard for a name that can be used as part of a website address.
Remember, too, that it is better to project a positive image through your business name-one that suggests you can solve a problem (so Professional Plumbing may work better than Drip Drip Plumbing).
Renner says once a name has been chosen, it should not be changed without considerable thought because a recognisable business generates brand equity. “Once that value is quite high to a business, the costs of changing the name can be quite high as well.”
As a general rule, re-branding an established business is inadvisable. There are exceptions to the rule, though. The most common reason to re-brand is when companies merge and the proposition being taken to the market has changed.
An image overhaul may also necessitate a name change-for example, national bedding chain Captain Snooze is now known simply as Snooze because the company’s long association with comedian, Rod Quantock, the face of its ad campaign, has ended.
The new name provides a chance for the chain to present a new offering to the marketplace. Most analysts agree, though, that re-branding should not be undertaken lightly.
As in the Captain Snooze example, one way to achieve quick brand recognition is to recruit a celebrity as a spruiker for the business. There are potential pitfalls, though.
An SME may only be able to afford a B-grade celebrity, and that may send out the wrong message to customers. Celebrities also have a habit of creating headlines for the wrong reasons. Allegations of child sex abuse against Michael Jackson created a nightmare for Pepsi. Similarly, front-page pictures of model Kate Moss snorting cocaine forced fashion chain H&M to drop the catwalk star.
A brand such as Virgin is synonymous with its founder Richard Branson, but such cases are the exception.
While most SMEs fear the cost of a branding campaign, it doesn’t have to be an expensive exercise, according to Australian Marketing Institute chairman, Roger James.
A letterhead, an invoice, a staff uniform, a media release-they can all send out powerful messages about a company. “And all of those things don’t take a lot of money,” James says.
He warns SMEs not to dilute the value of their brand through thrifty measures. For example, colour is often an important feature of a brand so it is no good skimping on stationery and having the logo printed in black and white.
Significantly, James says money spent on branding will probably pay for itself through higher profits. Loyal customers who are attracted to a brand will keep coming back, ultimately lowering sale-generation costs and increasing profit margins. A respected brand also allows a business to command higher prices.
At FutureBrand, Riches acknowledges that the cost of building a brand can be expensive for SMEs-and major corporations, too. “The problem just gets bigger,” he says. Riches says SMEs have two options when it comes to a budget for branding. “You look at it as a cost-a necessary evil-or if you’re confident about which bits of your business make a difference, then it can be an investment.”
Riches believes branding is about leverage, and money should be spent wisely. If, for example, a business derives most of its work through word-of-mouth referral, spending a fortune on advertising to build a brand may be a waste of money. If a shop-front is the key to sales, paying for advertisements that appear locally may be the most effective strategy.
Riches explains: “It’s about shaping how you spend money as opposed to how much money you spend.”
Census surveys reveal that fewer than 50 percent of Australian businesses have a website.
That is a mistake, according to Carolyn Stafford, who argues that most SMEs are ignoring the possibility of using the internet to build a brand and generate income through e-commerce. “A lot of them are still stuck in the brochure era where the website is really just an online brochure,” she says. “There’s a lot of work to be done on the e-marketing side.”
Using tools such as Google AdWords, viral marketing, e-newsletters and podcasting are all accessible-and relatively cheap-options that can help SMEs promote their brand.
Stafford says: “I think it is absolutely mandatory that every business has a website. Then there are big opportunities to generate revenue online.” A website, however, can work for and against a firm. A good site should complement a firm’s branding strategy because it is increasingly a client’s first point of contact with an organisation.
While branding is crucial, Stafford says it will not cut through in the market unless it is accompanied by passion within the business. “A lot of business owners are not passionate about what they do, so they find it difficult to create that enthusiasm among staff and customers. When people see your passion they come along for the ride.”