What's good for the business is not always good for the brand
A brand is a product or service and all the associated experiences in the minds of your target market. But, how do you build a brand? Almost every successful brand in the world started as a narrowly focused product or service that stood for a single idea with one core promise.
Business leaders are always looking for ways to grow their businesses often by expanding their brands into other categories. Yet many case studies reveal that it pays off in the long term to rather build your brands into leaders in their categories. Often the best way to do this is by simplifying your brands so that they stand for one core promise.
What's the most reliable measure of the power of a brand? Market share. Powerful brands dominate their markets.
In South Africa, Toyota is currently the market leader with 24.1% market-share. Vida e Café blasted onto the coffee scene leaving the other coffee brands bitter. Outsurance has featured as a premier South African brand for several years running.
When your brand dominates a market, it is in an exceptionally strong position. Research proves that in a mature market, a dominant brand is highly unlikely to ever lose its position. (Nandos, Coca-Cola, Levis, Nike are good examples. What will it take to knock these brands off their pedestals?)
And here's the good news for the financial guys. Dominant brands usually generate exceptionally high profit margins and No.1 brands are always worth far more than No.2 brands.
“You can't dominate a category if you expand your brand into many other categories. You can only dominate a category by keeping your brand focused,” advises Desiree Gullan, Creative Director of brand-centric™ advertising agency, Gullan&Gullan.Brand building to grow your business
Too often, marketers allow short-term sales and profits to get preference at the expense of building long-term brands. For some this may be the only option for survival in tough economic times. But, if you want your brand to become a leader then you should find a way to endure the tough times by sticking to your brand building strategy through thick and thin.
Given that experts say the marketplace is likely to remain volatile for at least a year, it is still possible - and important - to build a long-term brand. In an research survey conducted by Lindsay Stone & Briggs marketing professionals revealed that 97% of respondents said it is important to build a long-term brand and 80% predict that in five years' time building a brand's value will be seen as an even bigger priority than today.
The reasons respondents cited is that branding is the only way to increase the odds of sustainable profitable growth, because branding is the only means to create something a customer will trust all the more when the world around him is chaotic.
“The good news is that building a brand is no longer expected to take 15 to 20 years or more. The world operates at a different speed and consumers, suppliers, distributors, analysts, investors - everyone - demands faster performance,” adds Gullan.
Of marketers surveyed, 87% said the expectation for building brand equity was now 10 years or fewer, and 46% said it was now fewer than five years. In fact, our whole culture is now demanding optimized value creation in about three to five years. How do you build brands in today's fast pace?
To grow your brand in a world where the long-term is short, ensure that your marketing team is equipped with the following tools,
_A flexible and agile attitude
_Work with non-bureaucratic business models
_Respond to changing market conditions and opportunities fast
_Plan and strategize more frequently
_Track results and adjust media and creative to reflect real time metrics
_Willingness to harness the power of technology.Fast forward marketing life cycle
The classic marketing life cycle has four stages, namely,
1. Early growth
2. Accelerated development
Current marketing strategies look to speed up the first two stages. A fast boost to the size of your customer base is key. A brand's strength comes from a lot of loyal customers. But size and loyalty of a customer base are actually not a marketer's ultimate strength today. It's the creation of a loyal customer base that is very vocal on your brand's behalf.
Remember, a brand's most valuable customer is no longer the loyal one who purchases a lot and often, it's the one who may buy little but whose blog postings, online product reviews and favourable word of mouth influences others.
“Think fast. Be nimble and make sure that you engage with your target market as this is essential to getting short-term marketing performance. And creating brand value for the long-term,” Gullan concludes.