In a recent survey of 100 advertising/marketing agency websites, 64 of them equated Branding to a new logo or tagline. Only a handful correctly identified Branding as a discipline to increase the market value of a company beyond its book value. And fewer still seemed to consider the fact that effective Brand Management belongs to the C-Suite as much as it belongs to R&D, HR, Operations and oh, yes, marketing.
The industry’s confusion over the meaning of “Branding” seems to have even Wikipedia confused. Enter “Branding” into Wikipedia and it will take you to a “disambiguation page.” Evidently the term, Branding, has such a variety of definitions that Wikipedia attempts to resolve the “ambiguity” by listing the many conflicts on a single page.
Clearly, the discipline of Branding suffers from semantics.
Unfortunately, it also seems to suffer from a bit of naiveté. If most agencies think: “Branding = logo + tagline,” then the discipline of Branding as a systematic and robust methodology for increasing the value of a company from within is sadly underutilized. As a result, the prosperity of the company, its employees and stakeholders are likely compromised as well.
At the other end of the spectrum, sophisticated CEO’s and stakeholders recognize that a company’s brand is the only asset that does not depreciate. Buildings crumble, machinery ages and even patents expire, but a properly maintained brand can actually gain value year after year.*
For both B2B and B2C brands, the rewards for deliberate and powerful Branding can be huge. Consider Coca-Cola and IBM, top ranking B2C and B2B companies, respectively. By two separate surveys published recently, Coca-Cola was valued around $79 million US dollars by both, whereas IBM was valued at $79 million by one and $112 million by the other. Keep in mind, these numbers do not include any other assets like physical property or inventory and both valuations have increased from $3 to $12 million over the previous year.**
So what’s a CEO and Marketing Director to do to capture non-depreciating value like this? Brand Value is a tricky combination of tangibles like price premiums, and intangibles like consumer goodwill. Clearly, a Brand’s customers (B2B and B2C) have a considerable role in the Brand’s success and ultimate value. So, yes, powerful Branding benefits from customer understanding and segmentation, but must never be enslaved by it.
The smart C-suite engages in scrutiny to deeply understand the company’s competitive Brand Position as well as its driving Brand Purpose and the Pillars that support its Brand Promise. The result is an internal foundation of “Who We Are” and “Who We Serve” that can, and should, drive every decision in the company: innovation, international expansion, channel and distribution, social media and even marketing. The company that helps every employee in every department embrace “Who We Are” and “Who We Serve” will efficiently and powerfully win its customers and their wallets.
Commitment to focused Branding belongs to every department in the company. At Clear Blue, we have seen focused Branding initiatives driven from R&D and the C-suite as well as the marketing department. When a Brand Launch, update or refresh is successful, everyone in every department holds themselves accountable for building Brand Value. With consistency and persistence, companies like this can regularly impact their bottom line with a strong Branding initiative alone.
Ironically, an original definition of “Brand,” before the notion of a trademark ever evolved, is perhaps the best: “to indelibly impress on the memory of.” When HR, R&D, Operations, and everyone in your company consistently and powerfully make an indelible impression on your audiences, you are well on your way to a Brand Value that will make your ownership proud and your competitors nervous.
* Steve McKee, “Power Branding”
** Interbrand 2013 Best Global Brands and Millward Brown 2013 BrandZ Top 100