Having joined BNI soon after starting my business in 2006 I kept hearing the designer in the chapter referring to how everything you do is your brand, or that it was important to stand out. Intrigued, I had become a client of the agency and undergone “branding”. Yet here I was a few years later unsure what ‘brand’ meant. I asked a group of entrepreneurs in a Facebook group what they understood by the word, and got a host of different responses. I also sought out definitions in respected textbooks.
Over the years, I’ve read many books on branding and heard many people refer to it. The word is bandied around quite a lot, and yet most people are largely unaware of what it actually means.
A brand is actually one of the most valuable intellectual property rights a successful business can have. In fact, most business assets such as the brand are largely digital and intangible in the 21st century. Much of the work that a creative agency does when “branding” a business involves creating intellectual property assets which the business should own. However, unless there is the right written agreement between an agency and its clients the client will not own the IP assets.
It makes sense that a 21st century approach to branding should be an IP led activity so a lawyer can, among other things, ensure the agreement with the design agency protects the client. Brand creation should not be a design led activity.
I’ve decided to write a book on the subject, but I don’t want to just add to the noise around brand and branding. I want to discover what really moves the needle in branding, so that my book can truly enlighten readers and act as a guide for them. My starting point for this, has been Byron Sharp’s research, which is all about evidence-based marketing, as detailed in his book How Brands Grow.
The result of research conducted by Byron Sharp and his team with the world’s top brands at the Ehrenberg-Bass Institute, University of South Australia indicates that our existing preconceptions about increasing the loyalty to our brands is misguided. He found that all brands have a lot of buyers who only buy them infrequently. Even the Apples and Harley Davidsons have a lot of light users who buy other brands more than they buy them.
Those brands with a smaller market share have less market share, largely because fewer people know about them to buy them. The people who do buy them are less loyal and buy them less often. They devote less of their whole category buying to them. Consequently, the brand has fewer loyal customers.
The normal assumptions are that niche brands have a very loyal customer base, albeit small. However, it seems from the research that you can’t grow by selling to your existing customer base. You need to find new customers.
I’m still working out how to apply the research to service businesses, but the implication seems to be that branding is terribly important – not for building deep emotional connections with consumers, as is generally thought, but in the battle for attention. Consumers are very busy with other things, which is why they don’t fall in love with brands. They’re very happy to be loyal to a repertoire of brands. Even heavy category buyers don’t buy all the brands that are on the market. They keep returning to some favourites. They’re happy to be loyal. To do that they have to recognise the brand, notice the brand. The key in other words, is that brand has to be present wherever the consumer is looking to buy.