What's Your Brand Worth?
“Brand” or “reputation” attract or repel customers. Companies can have reputation and product brands; people have reputations (although these days recruitment agencies talk more and more about your “personal brand”).
The word “brand” originally meant a permanent mark made with
a hot iron (as in branding livestock, criminals or slaves in ancient times). Later on, it came to mean a trade mark or
goods of a particular make or trade mark.
Buyers recognise these trade marks and know that they mean that they can
expect certain things of a product or service.
If they don’t recognise a trade mark, then that product/service has to
prove itself to them.
We associate certain qualities with certain brands of
goods. Look in your larder and at the
labels on the food stored there. Do you
buy the same brand every time without thinking?
Why? Do you buy it time after
time without thinking? I do.
Now imagine that you can’t find that brand any more. I found that I couldn’t buy Macleans toothpaste (which I had been
using since childhood) in Asia when I was first posted there at the age of 24,
so I had the choice of either not using any toothpaste or switching to another
brand. In the end, I chose Colgate.
I had to get used to a new taste, but it did the job just as well. Since then, I’ve used Colgate. I never think about
it, I just buy it when I need more toothpaste.
Supermarkets now offer their “own brand” foods and
products. Some (to me) taste no
different to the “original”, but are cheaper, so I buy them. Others are noticeably different in taste,
texture or size, so I stick to the original.
In some cases, I’m prepared to put up with the differences, at other
times, these differences are too great, despite any obvious price advantage.
A good “brand” doesn’t have to compete on price - at least
not initially. People are prepared to
pay a higher price for the quality/taste or whatever advantage that that
product/service gives. Equally, they
tend to go into “autopilot” and buy the same brand every time unless something drastic happens to change
their mind.
You can buy exactly the same laptop computer made by the
same manufacturer from two different companies.
The only difference will be the company name or logo on the case. One will cost more, the other less. Why?
Because one company simply has a better brand than the other, built up
over years (if not decades) of providing quality products and/or services.
People won’t think twice about buying a laptop computer made
by, say, Toshiba, but they will think hard about buying a laptop from a
relative “unknown” as they won’t know how well-made or reliable it is, so price
has to be the differentiator. After a
while, the “newcomer’s” quality will become sufficiently recognised that they
can either boost their prices, or else the competition may have to lower
theirs.
Consumers have any number of “dimensions” (or “criteria”) which
motivate buying decisions, depending on the goods they buy. These include (but aren’t limited to):
·
Price
·
Quality
·
Taste
·
Durability/longevity
·
Availability
·
Reliability
·
Warranty/guarantee period
·
Brand
·
Disposable income
·
Past experience
·
Anecdotes of friends
·
Advertising/promotion
·
Service
·
Store premises
·
Returns policy
·
Who the decision maker is (this isn’t necessarily
the buyer!)
Although it takes ages to build up a brand, it can take
almost no time for the brand to lose its appeal. One case I remember was Dasani bottled water which made significant inroads into the
bottled water market in the early 2000s until claims about the quality of the
product forced it off the shelves literally overnight.
When disaster strikes, brand owners take immediate action to
calm markets as preserve their brand.
This is clear from the recent saga of beef products containing horsemeat,
in the face of intense press coverage and criticism by politicians . I have received
an email from the Chief Executive of Tesco assuring me that they were acting to
remove any product containing horsemeat and to ensure that horsemeat couldn’t
penetrate their supply chain.
A good brand means continuing business. What is your brand doing for you? What could “kill it”?
I have spent more than half my life working in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy and work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email . My website provides a full picture of my portfolio of services.
Labels: Crisis Management, Customer Care, Productivity, Risk, Selling, Strategy
posted by William Martin @ 22:37
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