Future50: Why a focus on brand adds real value to your business
By: Murray Graham Date: 27 January 2016
To give you an idea of just how much real financial value a brand can bring, you only need to look at the actual values of some of the world’s biggest brands – these are actual numbers, equal in status to the machinery, buildings and other physical assets when it comes to measuring the true financial value of a company.
The Interbrand 2015 Brand Rankings put a value of $170 billion on the Apple brand, and calculate that the top ten brands in the world are worth between them a staggering $716 billion - that’s $100 billion more than the entire GDP of the United Arab Emirates.
Whilst Future 50 members might not build brands worth these stratospheric figures, it is unarguable that building a strong brand is one of the primary ways that any business can strengthen its profitability.
So you shouldn’t be surprised to find me, an accountant, advocating that every business should devote considerable attention to getting its brand right.
We at Lovewell Blake have recently emerged from a project which has lasted more than a year, in which we have tried to understand the essence of our own brand. The result of that process has been a change in our visual identity, but more importantly, it is informing everything that we do, and how we do it.
The Oxford English Dictionary defines a brand as ‘an identifying trade mark’, but this is to misunderstand what it is all about. A brand is not a logo, or a name, or a visual identity. Think of these things as the clothes your business wears, which, like your own garments, reflect the person within.
It is that personality which makes up your brand – the essence of what makes you, you. Once you understand that essential personality, you can ensure you present it in an appropriate and effective way. If you can communicate a brand which resonates with customers and potential customers, and which will engage them, you will build loyalty to your business, trust in what you are, and a sustainable future. It really is that important.
However, a brand is not something you can simply conjure up from nowhere. For a brand to be credible, it must be three things; true, relevant and differentiating.
The importance of truth in a brand is self-evident; for a brand to be trusted, there has to be total honesty and transparency. Including brand attributes that do not accurately reflect what you really are about will destroy that trust. Put another way, if I dressed up as a plumber, it wouldn’t make me a plumber, and any attempt to convince the world that I was a plumber would be doomed to failure.
Relevance to your target audiences is also crucial. If your brand messages do not resonate with them, they will simply turn off. To build a brand that is relevant requires you to truly understand your audiences, what makes them tick, what will engage them, and what will turn them off.
Even if you find attributes which are both true and relevant, they still need to differentiate you. You want your brand to stand out, and that means offering something different from the pack. Sometimes this is about what you do, but more often it is about how you do it – your approach, your values, your ethos.
Customers engage with brands for both rational and emotional reasons. The former might include price, reliability, product quality and so on; the latter is far more powerful, and can include such things as prestige, ethics and trust. And the more your business is operating in a sector where there is little or no functional differentiation between your products and services and those of your competitors, the more important your brand becomes.
Measuring the value of your balance sheet is relatively easy when it comes to the bricks and mortar of your business. But that should only be part of the picture; building a strong brand is an essential part of building the value of your business, and as an accountant, that is why I believe you need to invest time and energy into building a really strong brand.