Demystifying the power of branding
“What is branding, anyway?” That’s one of the most-asked questions I get from small business owners. “A brand refers to the unique, intangible, and often indiscernible, association prospects and customers have regarding your products and services,” I say to them. Having a respected brand helps you stand out from the competition, fosters loyalty, creates an emotional bond with customers, and enables you to charge a premium for your products.
At this point, I usually see business owners’ minds spinning as they wonder what it really means overall to their business—that is, will becoming a strong brand be worth the effort. They wonder “What’s in it for me?” They don’t understand the power of branding and how it can move the needle for their small business.
The impact of a strong brand: beyond visibility
First, understand that what having a strong brand does is more important than what a strong brand is.
There is a famous scene from the TV show The Office where the main character says “Explain this to me like I’m five [years old]” upon being told that the company has a budget surplus. I often think of this line when I’m talking to small business owners, many of whom are experiencing declining sales revenues, low traffic to their websites and their retail stores, and who lack the direction to change course. Last week, while having a conversation with my mom, she said—while I talked about the work I do—”explain it to me in a way that I can understand.”
The power of branding explained for the five-year-old in all of us
I used an example from the church we attended when I was a kid. I reminded her of how, after church, we would all go into the dining hall, where there would be food displayed on the long, wooden bar. There would be fried chicken, potato salad, grilled fish, pound cake, pork chops, coconut pie, sweet potato pie, potato salad, and plentiful jugs of sweet tea.
My mom, looking to eat some fried chicken, potato salad, and coconut pie, would always ask the same question before digging in.
“Who cooked it?” she’d inquire. She was mindful that not everyone kept a clean house and cooked tasty food, so she would only eat food from those people whose reputations for cleanliness and tastiness she could vouch for. She was, I told her, looking for a trusted brand.
“When you asked who cooked it,” I said, “you were making clear your intentions of only selecting items from known and trusted sources. But inherent in that were specific characteristics of the brand—or, in this case, individual—you most cared about: cleanliness and cooking ability. Their reputation mattered.”
That’s branding at its core, I said.
Effective branding is a differentiator for small businesses
I love this example because it allowed her to see not only what a brand is—intangible, and often indiscernible, association prospects and customers have regarding your products and services—but also, and most importantly, what it does. Branding guides customers to the products and services they desire by giving them confidence in their choices.
I like the way branding expert and NYU Professor Scott Galloway describes what having a brand does for a business:
“Brands are a shorthand for a set of associations that consumers use for guidance towards the right product. They’re a powerful engine of value creation, convincing us to pay more for something than it costs to assemble. Brands are a promise, often more powerful than the product itself.”
Small business branding in action: a real-world example
To illustrate the power of branding for small businesses, I’ll use an example of a local business whose owner is a friend of mine.
Company: Insurance Agency
What his customers care about:
- First-class service
- Industry knowledge
- Excellent communication skills
- Hassle-free coverage
- Plentiful positive reviews & testimonials
What he excels at:
- He’s incredibly knowledgeable,
- Returns calls promptly,
- Delivers amazing customer service,
- Communicates clearly and effectively,
- Has more positive reviews than any agent in his area,
- Specializes in fast, hassle-free coverage for all vehicle types
Result: He’s one of the most successful and most beloved agents in the areas he serves.
Making branding work for your small business
Now that you know what being a desired brand does for a company, the next step is to understand how you can create such a brand for your business. Most businesses struggle with this because they don’t realize that focusing on the needs of their would-be audience is not the proper starting point. Instead, focus first on your brand’s needs and how best you can deliver a world class experience for a customer base that both needs and is willing to pay for those services.
Distilled to one sentence, it reads as follows: Figure out what you’re one of the best in your space at doing for an audience of sufficient size who is able and willing to pay you for it.
Conclusion: The lasting value of a strong brand
The priority you place on branding for your small business determines, to a large degree, the success you’ll ultimately enjoy. When you better understand the role branding plays for your small business, you can focus more intently on the activities that place you closer to success.
