80% of all CEO’s believe their brands and products are unique in the market. But…only 8% of their customers agree (source: a survey by Bain & Company in 2009). Differences between brands are hard to perceive and articulate for consumers. They don’t necessarily choose the ‘best brand’ in terms of functional qualities. They choose the one that comes to their mind most easily and that they perceive as most unique. This practice is more common especially when products or services are difficult to compare, or look much alike in terms of functionality and price.
Brand = shortcut to decision-making In a world of information-overload, consumers make guesses based on imperfect information. They have too little time and too much on our minds to compare and weigh all possibilities thoroughly. So we begin our search by considering the options that first come to our mind. From that point we tend to take shortcuts to decision-making and allow pragmatic and personal (often unconscious) rules of thumb to guide us.For example:
- “If it sounds familiar it will be more reliable”
- “If it’s expensive it will be of better quality” – but is it?
- “If there is only one piece of jewellery in the window, it is probably very valuable”
- “I just always choose the cheapest”
- “I choose the one that looks most tasty”
Consumers use a brand (image) as a rules of thumb. A brand image consists of a very superficial characterization of the main difference that we think and/or feel that a brand makes. It’s not much unlike a prejudice about somebody. Whether assumptions about brands are justified or not, we are influenced by them:
- A Japanese car can functionally be just as good as a German. But do customers want to pay the same for it… And is a Volvo really safer?
- Those who drive around in a Landrover often feel more adventurous than say taking a ride in a Mitsubishi Pajero. But is it?
- For advice from McKinsey, companies sometimes pay tons more than that of an unknown firm. But who says the small firm is not just as a genius?
- For the security of a predictable room in a Hilton hotel, fans happily pay hundred dollars more than for an equivalent room at a similar (but unknown) hotel.
They use brands as shortcuts to decision-making and make choices based on what they THINK is true about your brand. The difference they expect it will make for them (whether functional or emotional) and the experience they expect it will give them
Brand = business accelerator What (potential) customers think and feel about your brand thus impacts their choice and therefore your business success. The more familiar and unique it is in their eyes, the stronger their preference. The more consistent their experiences with it, the higher their loyalty and the price they are willing to pay. The reverse is also true. If customers do not know you or where you stand, your brand is less likely to be considered and chosen. They certainly won’t be willing to pay a premium price for it.
Brand thinking is a way to increase the perceived difference between your brand and others. The bigger the perceived difference, the more likely people will remember your brand, prefer it, come back, pay a premium price or talk about it. Simple as that. Branding if done well, is a huge accelerator.
Strong brands, better financial results However elusive and intangible it might be, the image that customers have about your brand can have a big impact on your financial results. What (potential) customers think is true about your brand, affects their willingness to try and repeat buying your brand. Brand loyalty is of huge importance: it costs much more to influence a new customer than to keep and existing customer happy and loyal. Loyalty gives continuity to your organization or business.
Both in the short and long – term, a strong brand creates better yields. These results can be seen in terms of:
- More information requests and/or trial purchases by new customers
- More repeat business (70 % of all purchases are driven by loyalty)
- Higher margins
- Higher value when selling the company (as a famous brand with a loyal customer base provides security for the long term)
A cool logo doesn’t make a brand Branding is about influencing what people think about you. Every contact with a customer is an opportunity to remind him of your existence and rub the difference you make once more in. This is not a matter of brand design of advertising but of systematically making your brand essence tangible for customers in everything you do. Take for instance Uber:
- In a market where multiple taxi companies provide similar services against the same price (Ola, Meru), Uber promises and delivers the common man not just a convenient taxi-ride, but the experience of ‘having a private driver’. Everything consumers see from Uber supports this core concept. You directly connect with a driver, not with a taxi company. All it’s brand activations and partnerships are designed to enhance the ‘private driver’ experience. Uber plays your favorite music via Spotify, collects charity-give-aways at your doorstep, gets you an ice-cream and even brings you a kitten if required. The visual brand identity enhances the experience: as opposed to the average taxi service, Uber looks, talks and feels classy
- The brand essence (the experience of having a private driver) is not just a slogan, it’s the source or inspiration and touchstone for everything Uber does. Uber makes sure it reflects in everything, from product and service to design and messaging.
What does it means to create and build a brand? Building a brand means etching your brand’s name in consumer’s mind and influencing their perception (knowledge, thoughts, feelings). What we know, think and feel about a brand and feel, doesn’t come out of thin air. The image and feeling we have about them is deliberately created and cultivated by their owners. From the sum of contacts we have with a brand (from name to logo to messages to service-experiences), we believe that we will receive a certain experience of a brand.
Building a brand means systematically installing a prejudice (=expectation) in the minds of your clients, consumers or customers. We believe “Polo Ralph Lauren is a brand for preppy people” because the brand systematically emphasizes this in everything it does; from the style of clothes and the models to the interior of the flagship-stores or the events they sponsor. We believe VOLVO is safe, because the brand has been stressing that in it’s communication (‘Volvo. For life’) forever. Of course a Landrover is an adventurous looking car in itself; but still they do everything they can to reinforce the adventurous, tough looking image.
Wired to stick to people’s minds In the end the battle for mind- and market space is a memory game. Once a need arises that your brand can fulfil best, you want your brand’s name to pop-up in customer’s minds – including a notice of what makes it special. After reading this collection of blogposts you’ll know how to increase the odds that your brand will stick.
Getting started Before you can develop and a brand, you need to decide what essence you want to be known and remembered for. Read the next blog to get started.
Once you decided about how you want to be perceived, you can start to develop and align your brand’s manifestations: name, logo, communication, service.
Summary & checklist
- In a world of information-overload, consumers make guesses based on imperfect information.
- They use brands as shortcuts to decision-making and make choices based on what they THINK is true about your brand. The difference they expect it will make for them (whether functional or emotional) and the experience they expect it will give them.
- What (potential) customers think and feel about your brand thus impacts their choice and therefore your business success.
- The deeper your brand is etched in the memory in your target market, the better it is for your business. Once they have a need you can fulfil, you want them to think about your brand first.
- From the combination of messages and experiences we get from a brand, we believe that we will receive a certain, distinctive experience from it. People mentally ‘add up’ everything they see, hear and feel from a brand.
- Building a brand is not just about creating a logo and building brand awareness. It’s about deliberately creating, influencing and delivering consumer expectations about a brand. With preference and life-long loyalty as the ultimate goal.
- Brand ≠ product or logo. Brand = the picture you have painted in the consumers mind (facts + feeling + images)
- Since consumer brainspace is limited, the picture has to be simple and focussed.
- Painting a picture in people’s minds requires you to make sure everything the consumer sees reflects the difference you want to be known for; your brand’s essence.
- Brand building starts with focus: decide how you want to be perceived (and experience)