Distinctiveness is the key to standing out.
CREDIT: Getty Images
Building an exceptional brand is one of the most critical parts of building a successful business. Having a respected brand makes customer acquisition and retention easier, allows you to charge a premium for your product or service, helps recruiting, provides better access to capital, and increases your market cap.
Yet, despite that, most business leaders lack a true understanding of branding, what it means to get it right or to get it wrong, and the fundamental impact it has on your company. Building a strong brand and staying true to it separates market leaders from also-rans.
Powerhouse brands create extraordinary customer experiences that are fundamentally rooted in their mission and values. Even if they lose their way, those brands will put in the work to get back on track. In 2008, Starbucks Chairman Howard Schultz returned as CEO after eight years and found an utter mess. The company had expanded too quickly, and lost its distinctiveness. Schultz closed stores and refocused his people on what their brand represented. On one day, he closed stores for three hours so Baristas could practice making the perfect espresso. Isn’t that exactly what makes Starbucks great? A perfect cup of coffee, when and where you want it?
Rarely do brands lose their way in one magnificent swoop. Instead, brand erosion happens through a daily whittling away. Staying true to your brand is an act of daily maintenance and the small decisions you make every day. It’s hard to track when you’re getting it right, but here are five easy signs that you are getting it wrong.
1. You can’t quickly state what you stand for
If you, your partners, and your customers can nail your essence with one or two words, then you know who you truly are. That level of clarity is where everything else about a successful brand springs. For Amazon, it’s convenience. For Walmart, it’s inexpensive. For Tesla, it’s innovation. Google? It didn’t even have what most enterprises would consider a full-fledged marketing organization until it was worth more than $1 billion. Why? It didn’t need one. Everyone could see from Google’s products and brand experiences that it organized the world’s information.
2. You have a disconnect with customers
Customers are a quick read on who you are and how you’re doing. If your marketing describes you as “abc,” and they describe you as “xyz”, you’re in trouble. Comcast might want to be perceived as “Comcastic,” yet social media is filled with nightmare Comcast customer service stories, making the true meaning of that description one of failure and folly.
3. Your products don’t embody your core
Great products market themselves. Part of that, though, is having products and service experiences that align tightly with who you are. Adidas, facing bankruptcy in the early 1990s, regained its footing by returning to its shoe-making core, moving away from fashion and sponsoring the world’s most successful athletes by providing them with footwear to win.
4. Your workplace culture doesn’t mirror your brand values
Who you are within your four walls is who you will inevitably be in the world. Brand manners come from deep inside your company culture. For example, you can’t profess to have a brand value of delivering exceptional customer service and expect to provide that experience if you compensate employees poorly or based solely on non-customer service measures (such as sales goals). Case in point: Costco, unlike Walmart, pays a living wage, doesn’t treat employees like commodity products, and, in turn, their employees create a more friendly and inviting experience while still providing superior value.
5. Your market cap or valuation is slipping
If you’re losing ground with investors while competitors with similar (or worse) market performance are not, your brand is likely part of the problem. Tesla is often dubbed as overvalued by pundits. Maybe so. Maybe not. The traditional car companies struggle to command valuations at a high multiple of revenue, yet Tesla has no issues getting cash to fuel growth. What investors are betting on is that what Tesla claims its brand stands for is real in the eyes of its customers: Tesla wants to change transportation through sustainable products with a premium experience.
The old school of thought is that your brand is your visual identity, or your marketing statements. But your brand is so much more; it’s the sum of the experiences your customers, partners, and employees have with your business. It is an this accumulation of impressions and experiences that define your brand and, when you get it right, it is the thing that customers will come back for — time and time again.
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.