Why Brand Matters

Posted on Posted in How to Guide for Marketers

You can make more money by investing in your Brand

The reason that most business’ choose not to invest in a brand, is they “can’t afford it”. But really, by investing in a BRAND, you can make more MONEY! Use the connectivity between brand and consumer to leverage premium Pricing. Use your brand’s power to drive Lower Costs. Leverage the bond with consumers to Increase your Market Share. When you have an idea bigger than your product alone, you can enter into New Categories that fit with your idea. Here are the 8 ways a BRAND can make you more MONEY!!!  Companies only invest to create a Brand if they think they can make more money from a brand, than if we just had a Product.  Slide1What you want to do is create a strong bond between your consumer and your brand. Once you have that bond, you can use it as a source of power versus all the stake holders of the brand.  If we think back to porter’s model, the brand’s bond gives you added power over customers, suppliers, competitors and even the very consumers you have the bond with.  Beyond Porter’s forces, the brand would also generate added power with the media, key opinion leaders and employees.  Once you have power, you can drive growth and profit, using that power to drive up price, drive down costs, gain market share and enter new categories.  

  • Use the connectivity between brand and consumer to leverage premium Pricing to drive profits:  By creating a brand idea that connects, you can try to command a premium or once you have a loyal consumer, you can look for innovative ways to trade your consumers up. When consumers are emotionally connected to a brand, the price becomes more Inelastic. We can see in the market, that loyal brand fans pay a 20-30% price premium for Apple’s iPad.The more engaged employees begin to generate an even better brand experience. For instance at Starbucks, employees know the names of their most loyal of customers. Blind taste tests show consumers prefer the cheaper McDonald’s coffee but still pay 4x as much for a Starbucks. So is it still coffee you’re buying or are they paying for the Brand?
  • Use your brand’s power to drive Lower Costs: A well-run Brand can use their efficiency to lower their cost structure. If you are a hot brand, suppliers will cut their cost just to be on the roster of a beloved Brand. A brand that becomes popular will benefit from the free media through earned, social and search media. They may even find government offer subsidies to be in the community or partners willing to lower their costs to be part of the brand. For instance, a real estate owner would likely give lower costs and better locations to McDonald’s than an indifferent brand.
  • Leverage the bond with consumers to Increase your Market Share: Crowds draw crowds which spreads the base of the loyal consumers. I was walking past a store the other day and they had a line up to get into the store. We immediately became curious as to what that store offered. Competitors can’t compete–lower margins means less investment back into the brand. It’s hard for them to fight the Beloved Brand on the emotional basis leaving them to a niche that’s currently unfulfilled.
  • When you have an idea bigger than your product alone, you can enter into New Categories that fit with your idea:  We see many beloved Brands enter into new categories knowing their loyal consumers will follow because they buy into the Idea of the Brand. Starbucks has gone far beyond Coffee to where it’s now one of the biggest fast food chains in the world.  The idea is no longer tied to the product or service but rather how it makes you feel about yourself. 


You need to Focus your brand behind one Core Strength

Every brand needs focus.  Brands are either better, different or cheaper–or else not around for very long.  The problem I see is that brands try to be everything to everyone, and you end up being nothing to no one. Strategically, before going further, you have to decide on what core strength you will win on:  product, concept/idea, price or the experience.  The model below is a good tool that can help your team focus on what it does best.  


  • If you’re the PRODUCT driven brand of the category, you need to focus on driving innovation on both product and claims as a way to maintain superiority over your competition. You want R&D closely aligned to your brand’s Big Idea and you have to invest to continue the pipeline.  The marketing may take more of a rational approach. Currently, Samsung is one of the best product driven brands, whether it’s phones, TVs or appliances. Their one weakness is the inferior laptops they’ve tried to push on the market.
  • On the other hand, if you are a CONCEPT driven brand, you need to focus on being different. The problem is when these types of brands get distracted by trying to be better or just as good as the PRODUCT driven brand they compete with. The CONCEPT brands need emotional advertising and more creative approaches to connect with consumers. Apple is a great concept driven brands, creating an idea of simplicity that goes across their entire product line and experienced in their retail stores.
  • With EXPERIENCE brands, who focus on the people/culture as being the guts of your brand. You need to be purpose driven and values based, projecting why you do what you do.  Invest in training to instil values and project who you are through social media. With Hotels all competing on price and pillow feather counts, Ritz-Carlton is all about service, that meets the unexpressed needs of consumers.  Ritz-Carlton has a service credo with supporting service values. And they are so good at service, you can now take a 3-day Ritz-Carlton training program on how they do it.  
  • If you are the LOW PRICE brand, focus on efficiency and cost cutting to drive lower prices.  Make up for the lower margin by driving higher volumes, with call-to-action type advertising.  And you better be good at all the production, forecasting and sourcing.  WalMart does this better than anyone, even going as far as crushing every union movement.  To show you how good they are at operations, WalMart’s turns at shelf average 28 days, while most other department stores average 75-100 days. You rarely see the word “clearance” at Walmart. 

You need to Build your Brand by lining up all 5 Connector to your Big Idea

While you need a lead strength from the model above, once you decide on were you want to go, you need to create an IDEA and then line up each of the 5 elements of a brand:  promise, strategy, story, freshness and experience.   Slide1

  1. The brand’s promise sets up the positioning, as you focus on a key target with one main benefit you offer.  Brands need to be better, different or cheaper. Or else not around for very long. ”Me-too” brands have a short window before being squeezed out. How relevant, simple and compelling the brand positioning is impacts the potential love for the brand.
  2. The most beloved brands create an experience that over-delivers the promise. How your culture and organization sets up can make or break that experience. Hiring the best people, creating service values that employees can deliver against and having processes that end service leakage. The culture attacks the brand’s weaknesses and fixes them before the competition can attack.  With a Beloved Brand, the culture and brand become one.
  3. Brands also make focused strategic choices that start with identifying where the brand is on the Brand Love Curve going from Indifferent to Like It to Love It and all the way to Beloved status. Marketing is not just activity, but rather focused activity–based on strategy with an ROI mindset. Where you are on the curve might help you make strategic and tactical choices such as media, innovation and service levels.
  4. The most beloved brands have a freshness of innovation, staying one-step ahead of the consumers.  The idea of the brand helps acting as an internal beacon to help frame the R&D.  Every new product has to back that idea.  At Apple, every new product must deliver simplicity and at Volvo, it must focus on safety.  
  5. Beloved brands can tell the brand story through great advertising in paid media, through earned media either in the mainstream press or through social media.  Beloved Brands use each of these media choices to connect with consumers and have a bit of magic to their work.

As we talked about the Apple brand, here’s an illustration of how well Apple lines up behind their big idea.


You need to Transform your Brand by going Beyond Product

As you’re challenging yourself to think about going to Brand Thinking, here are some of the differences you might notice.  

  • Think of a Brand as an idea with many intangibles, whereas a product is usually tangible to the senses. This is where you as a Brand Leader must begin to think more conceptual and think of ideas.  
  • If we think of a Product as solving a Problem, then try to think of a Brand as fighting your consumer’s enemy.  
  • While managing a product, you’re always focused on trying to figure out the THINKING part of your consumer, and you offer very rational product features and claims, you might need to shift to start figuring out the EMOTIONAL decisions your consumer makes and finding more emotional benefits that connect with them.  
  • Instead of thinking of just the consumption of your product, start thinking of the EXPERIENCE. When I was a Brand Leader, I honestly didn’t pay too much attention to the experience.  We tend to think of that for service brands. But look at the EXPERIENCE of a product brand like Apple and see the difference it can create.
  • Brand becomes a reputation you must manage, going well beyond the legal entity and trademark.  Every brand should be using Public Relations to become part of the news cycle, helping to go beyond Advertising. Look to your most loyal consumers as a potential influencer of your reputation through social media.  
  • Start to think about becoming part of your consumers life, as a ritual, which goes beyond a routine. Be a favorite part of their day, or be an enabler to great things that happen in their life. Adjust to the days of the week of the time of the year. Leverage the calendar as a call out to how your brand might be used.  
  • A product can be debated, but a Brand will be defended.  Provide your most loyal consumers with enough love so that they love you back enough to defend you at the lunch table.  


The more loved a brand is by consumers, the more powerful and profitable that brand can be

At Beloved Brands, we run a Brand Leadership Center to train marketers in all aspects of marketing from strategic thinking, analysis, writing brand plans, creative briefs and reports, judging advertising and media. To read more on strategy, here is a workshop on HOW TO CREATE A BELOVED BRAND, click on the Powerpoint presentation below:

At Beloved Brands, we love to see Brand Leaders reach their full potential.  Here are the most popular article “How to” articles.  We can offer specific training programs dedicated to each topic.  Click on any of these most read articles:

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We offer Brand Coaching, where we promise to make your Brand better by listening to the issues, providing advice that challenges you, and coaching you along a strategic pathway to reaching your Brand’s full potential. For our Brand Leader Training, we promise to make your team of Brand Leaders better, by teaching sound marketing fundamentals and challenging to push for greatness so that they can unleash their full potential. Feel free to add me on Linked In, or follow me on Twitter at @belovedbrands If you need to contact me, email me at graham@beloved-brands.com or phone me at 416 885 3911