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Branding Take One – It’s for Every Company

Once, one of the hottest topics in technology marketing was branding. Due to the industry's downturn it seems that this area was one of the first to suffer the brunt of the "new corporate spending policies". Suddenly, many mid-sized companies and even more small companies decided that the word branding meant the corporate logo, tagline, packaging, etc. and they started dealing with branding in-house and through the employ of graphic artists. This simply is not so, and it seems to me that during these trying times, the emphasis on branding is even more important than during times of "hype".

Last week I met with Mike Emery a partner with Wolff Olins Ltd., a multi-national brand creation firm, and we discussed various philosophical aspects of "text-book" vs. "real-life" branding. This discussion inspired me to try to share with you how Tudog views branding – A Pro-Active Corporate Strategy. It's a must for every company regardless of size and standing. If your company's vision includes sustainability and the creation of value for its owners, you need branding. And, by the way, it need not mean the allocation of endless funds.

Branding 101

Branding is nothing new, having been around for decades in more mature industries like consumer electronics, package goods, financial services and many others. So what's the big deal and why the sudden fuss over branding in the technology sector? Partly, it's the natural evolution of an industry, initially being internally driven (engineering), then becoming externally driven (marketing), as a consequence of margin pressures and greater competition. Tudog calls this transitioning from inside-out to outside-in marketing.

In some cases, it's been branding by default, because many of the more mature technology categories like PCs (Dell, Gateway, Compaq, IBM) have tried everything else. For example, the first company to offer a major breakthrough like a self installing xDSL modem, CD-Writer\DVD Combo, 3 MHZ processors etc. would develop a short-term promotion around the feature. Then a competitor would introduce a more robust feature and the cycle would repeat. The "window of advantage" any competitor had became smaller and smaller. When all hardware manufacturers began to approach parity on features and performance, some began to compete on price. With the inevitability of shrinking margins, some forward thinking marketers turned to another point of difference - their brand.

By aggressively competing on features and price, it's been difficult for companies to create meaningful and lasting differences from their competitors. Customers benefit from price wars by saving money, but also get confused when choice is confined to price, MHZ's, GB's or what is sometimes called "speeds and feeds." The customer is in effect buying a commodity and has no sense of brand loyalty because little is known about the company making the product or about service after the sale. So today most hardware companies are already underway with branding campaigns to differentiate their products through the companies behind them.

As a consequence, technology companies like Compaq, 3Com and Intel are aggressively diversifying into the consumer arena and launching branding campaigns.

They believe this will create a positive corporate image platform on which to launch whole new categories of products. There is also growing evidence that brand equity improves stock performance. Time will tell if these strategies will be successful. But they can increase their opportunity for success by following well-tested branding principles discussed in this article. On the other hand, they will not succeed unless they are diligently end-user focused, invest adequately in marketing and are consistent in their implementation over time.

Who is Branding For?

So you might ask if branding is only for large companies in mature categories? Definitely not, although these are the ones getting all the publicity by hiring big ad agencies to help them spend big ad budgets. In truth, every company or start-up should have a base-line branding strategy before they initiate any marketing programs. A branding strategy is the genesis of all customer contact activities. Initially, it should be the core of all investor and public relations, sales, customer service, website design and initial advertising. Later, when budgets allow, the branding strategy becomes the foundation for larger marketing communications investments such as multi-media advertising, collateral, direct mail, trade shows and expanded PR activities.

One more benefit, at the most basic level, is that a branding strategy should both mirror and influence company culture by setting the tone for employee interaction, internally, as well as externally, with analysts, suppliers, partners and customers.

Branding Defined

Before going any further, however, we should set the record straight on what a brand is, and is not. Only then can you go about the process of branding your company and your products. First, your brand is not just your logo, tagline, packaging or the "look and feel" of your ads and your website. These are all graphical elements of your brand identity and are often narrowly, and incorrectly, referred to as "branding." Here is a much broader definition shared by many in the brand management community:

Your brand resides within the hearts (feelings) and minds (intellect) of your customers and prospects. It is the sum total of their (product, company and competitive) experiences and perceptions, some of which you can influence, and some you cannot.

Successful brand managers recognize they must understand the needs and wants of customers and prospects. They strive to convey that they meet these needs and wants in a differentiating way that is motivating to prospects. They accomplish this by initiating integrated strategies throughout the company at every point of public contact - marketing communications, customer support and sales.

Branding Matters

And just in case you're not yet convinced that branding is something your company should be concerned with, here are some reasons that should get your attention. For example, a successful brand can benefit you in the following ways.

  • Separate you from your competitors, in a unique way, that is relevant (and motivating) to your customers, prospects and channels - it gives you value and makes you special.
  • Enhance your perceived value, thereby supporting premium pricing, sheltering you from low price competition and contributing to shareholder value. Companies like Morgan Stanley look to evidence of brand strength in setting buy ratings.
  • Provide resilience in times of negative press.
  • Enable you to launch new products more quickly and cost effectively.

Remember: brands happen, with or without you. It is up to you to be pro-active in shaping the identity and strength of your brand image.

This article has addressed branding from the macro level defining the critical roles brand management can have for all corporations. The idea was to promote the importance of incorporating a branding strategy for businesses of all sizes. Next month we will deliver some tactics on how it's actually accomplished.

Oh and Mike, thanks for the inspiration…

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