As the manager of a business, you are constantly looking for ways to improve the many aspects of your company. Of course, there are a myriad of ways to accomplish this. To increase profit margins, you might look to lower product costs, make distribution more efficient, or lower overhead. No matter what you do, however, nothing will be as effective as it should be unless you first establish an effective brand.
What a Brand Is
It seems that the term “branding” is being bandied about a lot these days, so before we go any further, let me explain what branding is. While some of you may think of it as the buzzword au jour, others may understand its importance, and yet others may find it utterly confusing.
The single most important thing you can do to increase your profits is to be sure your brand is up-to-date, accurate, and pertinent. Once you have done that, you must promote your brand everyday in everything you do. When it is consistently promoted, it not only builds awareness of your product or service, but it also tells prospects how they can expect to benefit. Remember… anyone who is going to spend money usually wants to know what the purchase will do for them. In fact, 70% of all purchases are made on an emotional level. So for the most part, buyers aren’t concerned about the logical points of the purchase. If they were, the vast majority of us would be driving small, fuel-efficient cars with one-speaker radios.
Think of your brand as a promise… a promise you make to your clients, prospects, employees, and even your vendors. But before you make that promise, be sure you never forget this fact. It is imperative that you are able to back it up. You cannot build a successful, long-term brand on unsupported claims and wishful thinking. History is littered with companies — big and small — that have promoted themselves or their products as something they would like to have lived up to but could not.
To separate you from your competition, your brand — your promise — has to differentiate you from others in the minds of your prospects. This is the reason you cannot use quality, integrity, or price when positioning yourself in your marketplace. So many companies claim to offer these particular characteristics that none of them stand out from the others. BMW has taken note of this. Although it is thought by many to be the best car made, the company has built its brand as “a driving machine.” It sells the experience. BMW knows that there are other high quality cars on the market, so a brand built on quality would be diluted and therefore, less profitable.
The same holds true for integrity and honesty. If you claim to be honest, you have set yourself up to be lumped in with everyone else in your industry. (Do you have any competitors who promote themselves as dishonest?) And price… this is a mistake on so many levels. Unless you can beat your competition with low prices and still keep profit margins relatively high, you are on a downward slope. Few companies, one being Wal-Mart, can accomplish this over an extended period of time. Wal-Mart can do this so successfully because it has built a world-class distribution network and has tremendous buying power. Furthermore, if you sell your product or service on price alone, you have to attract new customers all the time. The customers you had yesterday will be looking for someone with an even lower price tomorrow.
It Starts At The Top
A brand must have the support of the top person in the organization. Whether your company employees 100 people or one, the brand will work only if the head of the company believes in it. That person must set the tone of the company, and then manage that tone so everything the company does reflects it. This is important not only outside the company walls but inside as well. Beyond the walls, a strong, unified presence defines a clear message to customers and potential prospects. Inside, it encourages employees to make decisions based on a well-defined direction. When decisions and actions are consistent with that direction, efficiencies — and ultimately profits margins — are greater.
What Branding Is Not
Although you will hear things like new logos, redesigned brochures, or even stepped-up advertising referred to as branding, they are not. Logos, brochures, advertising and other forms of marketing may, in certain instances, be individual components of a branding campaign, but unless they are part of the system of determining a company’s capabilities, direction, opportunities, and indeed its essence, they cannot–and should not–be referred to as branding. To say that a new logo, for instance, is equivalent to a new brand is to believe that I can compete at Daytona International Speedway by slapping decals all over my car. Even if it ends up looking good, it’s still not ready to — or able to — compete.
What this all boils down to is the fact that every business — including yours — has a brand. The question is whether your brand is being determined by outside factors, or if are you actively building it on your terms.
As a speaker, author, and coach, Peter George helps self-employed professionals achieve the success they’ve been striving for.
His highly-acclaimed More Clients More Profits Workbook provides small business people throughout the world the opportunity to consistently attract not only more clients but specifically more profitable clients. It includes contributions from noted experts, including Ivan Misner, Bob Burg, Debbie Allen, Susan Roane, Scott Ginsberg, and others.