Brand Strategy is a Short-Term Investment with Long-Term Benefits10.03.17 / Retail Voodoo Alumni
The Nike’s of the world bring home the bacon, and they look damn good doing it. To the untrained eye, there’s something special about these brands – some might say they have “it.” Well, our years in the marketing and design worlds have taught us the ever-elusive “it” is also called brand strategy. Companies killing it with brand strategy have die-hard loyal customers and an entire lifestyle emulating from their brand’s core.
But with these heavy-hitting brands, you know they paid a pretty penny to look so good. Can they afford to have such a strong brand strategy because they bring in so much revenue? Or do they bring in so much revenue because they have such a strong brand strategy? It’s the classic chicken and the egg dilemma, but we have the answer this time. Strong brand strategy puts money in the bank.
David Ogilvy (arguably the grandfather of advertising) said brand is “the intangible sum of a product’s attributes: its name, packaging and price, its history, its reputation and the way it’s advertised.”
Our version is much simpler.
“Brand is the promises we make and the manner in which we keep them.”
— David Lemley
So, if brand strategy is this intangible concept, how can we possibly measure ROI on it? Why would you risk investing in something abstract? We all know brand is important, but is it important enough to spend money on? We’re here to tell you: taking the leap of faith to invest in brand strategy is one of the wisest possible uses of your money. A bold recommendation, but we’re ready to prove it.
People Don’t Buy Products, They Buy Brands
Your product could be in every single grocery store or every single outdoor retailer, and it could still fail. Purchase decisions happen in seconds – just like first impressions. Consumers already formed an opinion about your product long before they saw it on shelf based on its reputation, history, peer reviews, and brand narrative.
So, ask yourself: Does my reputation align with my mission? What does my brand stand for? Why do we do what we do? How do we want to impact people’s lives? What’s the legacy we want to leave? The answers to these questions form the foundation of your brand, which you use to build your products and identity. People buy into the brand before they buy into the actual product. Rather than shoving your product into people’s carts, let your brand do the talking for you.
When we diagnose a brand’s marketing strategies, we often ask them to replace their logo in marketing material with a competitor’s logo. Most are shocked when they realize any brand in their category can “own” their voice and their visual identity. When all of the products look and feel the same within a category, brands must give consumers another reason to choose them beyond the product offering. This is where brand strategy becomes crucial. If you lack a definitive point of view, you will never stand out from your competition. Show your customers you offer something more valuable than the purchase alone.
Before we removed the word “soda” from DRY Sparkling’s name, they tried to compete with brands like Coca-Cola and Pepsi. They frankly didn’t stand a chance against these heavy-hitters. That being said, it was actually the smaller brands taking their market share away. We dove into uncovering DRY’s mission, target audience, and vision through extensive research. After we transformed their tone and voice, their marketing messages began speaking directly to their consumer. It showed – rather than told – them how to seamlessly incorporate the product into their everyday life. Soon, DRY became a staple for the culinary-minded, metropolitan woman. She mixes it with her cocktails at foodie events and carries it into her board meetings. Consumers buy into the brand and the lifestyle it represents before they buy the product. No way could Coca-Cola or Pepsi slap their logo on their product and feel the same. As a result, DRY saw 20x growth in its first two years after working with us and they are now the fastest growing carbonated soft drink in North America. Talk about ROI.
Value is No Longer Simply About Price
In the experience economy, value has a new equation: value means that what I get must be greater than what I give. This can be dollars, but more often includes time, attention, loyalty, and belief. As a debt-ridden millennial living in an overpriced apartment in the city, my shopping habits tend to revolve around how I can get the biggest bang for my buck. I’m at the stage in my life where clipping coupons is the norm and buying a $20 bottle of wine is a luxury. But at the same time, I insist on buying MaraNatha organic peanut butter and refuse to buy Jif Natural.
I pay nearly double for virtually the same product because this purchase makes me feel better about myself. I know I’m not just buying a product, I’m investing in my health and the health of the world. MaraNatha exists to promote good health and preserve the environment. They do this by creating all-natural, great-tasting nut butters with simple ingredients. While Jif makes “all-natural” products, that’s not why they exist. They don’t have a compelling mission or purpose. Therefore, I feel better supporting a company like MaraNatha.
Start with the “why,” and then work backwards. Brand strategy helps you identify the “why” and then sets you up to share it with customers through packaging, identity, messaging, and so much more. Ultimately, when consumers understand the true value of the brand exceeds what they give, they are more inclined to spend more.
Brand Loyalty Overcomes Price Resistance
We all know the classic Mac vs. PC debate. However, the average Mac is roughly twice the cost of the typical PC. Why are Mac fans so excited to spend double for a (somewhat) similar product? It’s simple: they’re loyal to the brand.
Apple created an entire lifestyle around the Mac – it’s youthful, hip, and attractive. It’s aspirational. Apple’s entire brand strategy revolves around emotion. Instead of talking about the features of their products, they talk about what they believe and why they created the products. As Steve Jobs said, “The chance to make a memory is the essence of brand marketing.”
This emotional bond fosters fiercely loyal fans – exactly why it’s such a huge deal when a Mac user switches to PC. It’s an anomaly, despite possibly being the more economical choice.
When you purchase a Mac, you’re also purchasing the hope of becoming the idealized version of yourself. To many, that’s worth the extra money. Once consumers understand the “why,” price becomes a non-issue because the value of their investment surpasses the monetary amount they paid.
A Strong Brand Identity Attracts Capital
Although some startups have super flashy, cool new products, they frequently lack depth. Many of these brands sprung out of a brilliant idea, but require additional support and strategic direction to continue their initial momentum. Often, they have a “what” and a “how,” but not a “why.”
Investors can smell a rich brand narrative that will drive sales and produce revenue from miles away. When you take the time to create loyal customers and get them to buy into your brand (not just your product), you present a strong case to anyone looking to put money on your brand. Investors see your brand not as a makeover project they have to spend time fixing, but as a booming business at the threshold of greatness. Your brand won’t be seen as a child needing coaching and support because you’ll already be equipped with brand strategy to inform all of your business decisions and conquer the competition.
When Sahale Snacks invested in brand strategy, they refocused on their commitment to quality, sustainability, and community. Their “Snack Better Promise” showed consumers – and investors – why they existed. J.M. Smucker Co. recognized this strong brand core and acquired them shortly after. Their short-term investment resulted in leaps and bounds for the company’s market share. Brand strategy laid the groundwork for them to launch into the world and become an explosive force in their category for years and years to come.
Brand strategy informs the development of messaging and brand identity – creating a unique brand lifestyle and a loyal, long-term audience with incredible buying power. Audiences will buy into your brand, not just your product. This means cash money in your pocket. When it comes to brand strategy, you don’t just see a return on your investment – you see your investment come back tenfold.