How Bad (Or No) Branding Can Hurt Your Business
Branding is an integral part of building and maintaining a business. One of the foundations of every business no matter the size or industry, branding has come a long way since its inception which previously only referred to things like logos and slogans. Now, branding encompasses much more than that.
What Is Branding?
As Jeff Bezos, founder and CEO of Amazon, once said, “Your brand is what other people say about you when you’re not in the room.”
In short, branding encompasses all the aspects of your company and the activities associated with it. It has also come to mean the feelings and views a company can elicit from its consumers. While your brand is how people perceive you, branding is the set of actions you take to cultivate that perception.
More than that, how you brand your business is almost synonymous with how well it performs. Good branding allows your business to rise above the noise of its respective industry and capture your audience’s attention.
There are many different areas to develop and strategies to employ when building your unique brand image. This can include advertising, customer service, visual assets and your reputation. All of these elements work together to form one unique and attention-grabbing professional persona.
These are the tangible components of your brand:
- Color palette
- Fonts ie. typography
- Secondary assets like photo treatments, textures, patterns, etc.
Your brand also includes less tangible components:
- Brand Mission and Vision: What your company stands for and promises its consumers
- Brand Voice: The way your company sounds and speaks
- Target Audience: The kind of consumer you want to attract
- Brand Positioning: How you want your company to be perceived by your target audience
- Unique Selling Point: What makes your brand different from your competitors
Why Bad Branding Is Hurting You
What usually causes a company to underperform is their branding. While this may not be explicitly apparent, marketing efforts tend to fail due to the lack of clarity on what your brand is offering as compared to your competitors.
1. You’re Not Attracting Consumers
One of the main benefits of strong branding is differentiating yourself from your competitors and standing out as a quality option for your consumers. Strong branding generally means there is a positive impression of the company amongst consumers. This also means that they are likely to do business with you because of the familiarity and assumed dependability of using a name they can trust. Once a brand has been well-established, word of mouth can be a company’s best and most effective asset.
2. One-time Consumers
And even if you do manage to attract the right consumers, they don’t come back.
Authenticity is one of the most important facets of any business. If your consumers feel that you’re not being authentic, they’re not going to want to interact with your business. From a branding perspective, if what your consumers see, read or hear about your business is not consistent with their interactions with you, it can spell trouble for you.
Statistics also show that 77% of consumers make purchases based on a brand name. Therefore, a well-branded business is more trustworthy, credible and appealing in the eyes of consumers.
3. You Can’t Charge The Price You Want
You might be thinking, “What does this have to do with branding?” The answer is everything.
Your branding is directly correlated to how much you can charge from your products. Let’s look at the case of Starbucks.
In reality, when you design your brand, the brand should be informed by a few key things: what pain points are you uniquely solving, who are you solving them for, and who is willing to pay for your solution.
A cup of black coffee at Starbucks goes for just over $4, as compared to that same cup of black coffee from a hawker centre whose price sits under $1. Why can Starbucks charge four times as much for the same cup of coffee? It all boils down to their branding. Through Strabucks’ branding, it has positioned itself as a high-quality brand dedicated to serving its customers and providing the best experience possible (at least the best experience you can have while drinking coffee). Through this feat of amazing branding, consumers are more than happy to buy a cup or two of Starbucks coffee.
This is the same for companies which don’t have good branding. In short, they do not enjoy the same luxury. While another coffee company may offer a product that’s of the same quality or even better, without proper branding, you’re not going to be the one who gets the sale.
What Makes A Good Brand?
So what exactly makes a good brand then?
We all know that not just branding, but strong branding is critical for a business to thrive. In fact, branding can change how people perceive your brand, and increase brand awareness to drive new business.
Strong branding offers to differentiate your brand from its competitors and puts out clear and consistent messaging that highlights its unique selling point (USP) to attract consumers. A good brand has a clear focus, knows their target audience, has a defined mission, knows their competition and USP, can identify their key values, tell their story and have a brand identity reflective of these goals.
An example of a company with strong branding is Tesla.
Tesla is a luxury car brand that’s more immensely more expensive than its competitors. Due to this fact, their branding focuses on the quality of their vehicles and skips over the pricing element altogether. Tesla cars are also long-range, eco-friendly and electric—in addition to being luxury vehicles.
One of the major differences between Tesla and it’s competitors is that its cars are electric, compared to its gas-powered competitors. This is their USP and what they heavily rely on in their branding efforts. Through their branding, they have differentiated themselves from the standard electric vehicles because their cars are of higher quality and have a longer range.
With its effective branding strategy, clear focus and strong brand positioning, Tesla has carved out a niche market for themselves.
Pay Attention to Your Brand
When done right, branding serves to differentiate you from your competitors and stand out in your industry. It’s what transforms first-time buyers into loyal consumers and turns an indifferent audience into brand advocates. It’s what you need to stand out, make an impact and take your business to the next level.
The more effort and time you put into your branding, the more you’ll be able to get out of it—whether it be through a loyal consumer base or the ability to charge a higher price for your products and generate more revenue.