The value of brand strategy
What is the value of brand strategy? Can businesses be successful without it?
There was an interesting question on Instagram by Haris Spahic:
How important are brand strategy and marketing strategy in the context of the entire company, or all business units in one corporate portfolio?
Of course, it’s not an easy question to answer. First of value is always relative, especially in these fields. But in comparing it to business strategy, it makes for an interesting study. It’s also a question about what brand strategy really is. Let’s find out.
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The reason behind this question is also interesting. Why do we doubt brand strategy? Every industry, every discipline often overvalues their discipline and undervalues others. This is exactly what is described in the ‘the hallo effect’ (one of the 10 books on brand strategy to read). I see a lot of brand strategy being inflated, claiming to much credit. The halo effect happens when a company (or person) excels at one trait and we automatically bestow other attributes to that company. This confuses the actual drivers of performance. When we look at a company that has a great business, we often think it’s because of a great brand strategy, or great leadership, or a great product. Whatever the true driver, it’s hard to know, and brand strategy suffers a lot from this bias.
Also, brand strategy is often related one-to-one with ‘brand-positioning’. When that is the case, the value becomes a lot smaller. Because for a lot of organizations, positioning isn’t what makes them successful. So again, what we see as brand strategy matters a lot.
What is brand strategy really?
Let’s first look at the word ‘strategy’. I love Mark Pollard’s definition here:
Strategy is an informed opinion about how to win
So a couple of important aspects here: ‘informed’ means you have to do your research, you have to understand the market, the consumer before you can make an ‘opinion’ about it. And it’s opinion that wants to make the organization‘ win’;
There is also a difference between being ‘strategic’ in general and 'brand strategy'. A strategic approach to anything you do is important, you might have a strategic 'approach' to building a website. But that's not the same as saying 'we offer website strategy' as a sort of recognized process with outcome.
So being strategic is not the same as developing a brand strategy. It might be, but it might also be something else.
Often we talk about brand strategy as a 'service' vs 'brand strategy' as a 'framework'. One is often mentioned as part of something else, for example, an advertising agency may use brand strategy as a part of their process, but the outcome isn't per se a 'new brand strategy'. For branding agencies, the outcome is often more closely related to a ‘defined outcome’. It’s often a process of redefining the brand, creating a personality, defining the values, the essence, … In that case, offering brand strategy is really laying the groundwork for a brand, which is different from ‘using brand strategy’ to create the right brief. So keep that in mind when thinking about the value of brand strategy. What type of brand strategy? Who is offering the service?
For me, having a strategic mindset is key to good business, not just brand strategy, you need to have a diagnose, what is wrong with the company? Clearly understand the problem and then create a hypothesis on how to solve that; then you create a guiding policy and a clear set of actions. Very often, those steps contain things typical to brand strategy such as the brand definition, values, positioning, creation, etc.
So before defining the value of brand strategy, you need the understand the need of the organization. Only then can you define if 'brand' strategy has specific value.
But let's first define brand strategy. Here’s my definition:
Brand strategy is a platform that bridges business strategy with branding & marketing.
A couple of important aspects here:
Bridges: It's a 2 way street between business strategy and branding/marketing. It's not just a 'translation' of business goals into marketing or branding, it's a bridge. A lot of times, marketing feedback bleeds back into the business strategy and can even inspire new business. Understanding your consumer might give you insights to develop new products that eventually define your business strategy.
It's a platform for branding & marketing. A platform is something to build off, it's supportive of both disciplines and gives them a long-term perspective. Marketing looks at brand strategy as a starting point for new ideas, customer insights, advertising ideas and more. It also feeds back information into the business. Branding also builds on the same platform, giving marketing a recognizable face and being consistent without being boring.
Okay, now we've got that definition down, we can start to understand the value for organizations.
First of all, as the value of a glass of water can be tenfold for someone that has just a marathon in the desert, brand strategy's value is in the eye of the beholder.
The value for different companies
But let’s look at the value for different types of business. Considering we are offering brand strategy as a service to really define that platform and create that bridge.
If we look at the startups vs established axis, I would say, the value goes 'up' in the center of the axis, a business that have been around for longer then just a few months probably have a better understanding of the 'business' strategy (remember our definition). On the other hand, if we go all the way up, the value goes down a bit, because of the fact that most of these businesses have their brands well defined and understand their perception quiet well. Probably marketing, branding, inhouse teams taking over.
If we look at the left to right axis, small market share vs bigger market share, we would probably see the value increase of brand strategy for those companies that have a growing market share that isn't too small, because their physical and mental availability is becoming increasingly important, similarly, brands that have huge market share have bigger mental and physical availability, thus need to focus more on maintaining and refreshing rather then 'redefining' their brand strategy.
This is of course very much an assumption, a lot of times, starting businesses might value from brand strategy and huge businesses might not. It all depends on the individual organization.
Why does brand strategy matter?
Here are reasons why brand strategy matters for an organization:
Having a shared platform for branding and marketing can lead to consistent, distinctive communications. Thus being easily recognized and available. Thus having a stronger brand.
Having a platform that looks at the organization from a perceptual (consumer) perspective enables the organization to build products based on needs and expectations rather than purely rational decisions (considering you are doing brand strategy the right way).
Having a brand strategy can save the organization time and money when making decisions about branding & marketing. Being internally aligned for different disciplines is amazing.
Having a brand strategy can be a great platform to inspire good creative, based on actual needs. Good creative in turn can hugely valuable to the organisation. Advertising campaigns can really build brand and turn a bad year into a good year.
Why is brand strategy not so important?
So there is huge, potential value in that, but let's look at the some comparisons
Not having a decent business strategy might kill all efforts related to brand strategy. Unless brand strategy saves it by informing the business strategy (it happens).
A lot of companies don't even need to have a 'brand' to thrive, let alone a brand strategy. Look at big pharma companies or a lot of OEM manufacturing in China. These are hugely successful businesses that make money without any form of brand.
A sudden downturn in the market can destroy all brand strategy efforts. Not even the best brand strategy based on the best insights can foresee things like a global pandemic we are facing today. On the other hand, having a strong brand right now, being physically available (in this case, having a decent e-commerce channel) and being mentally available might be a huge factor in surviving this thing.
Other external factors such as the economy, changing laws can all undermine a lot of brand strategy efforts. Imagine having the best possible brand strategy as a realtor and all of a sudden the housing market falls apart. At that point, not having a decent business strategy, cash flow, crisis management, and other things are way more fundamental to business survival chances.
Not having a brand strategy doesn't mean, not having a brand. A brand is about associations and perception, every organization we come in contact with has a brand, whether that's build strategically or not. A lot of hugely successful brands have no strategy at all, they are just innately built with the right tools. For example, while Donald Trump might not be the best strategist, he has all the right tricks to be a huge brand, even if they are unconscious, he's distinctive, constantly salient, consistent is his messaging, omnichannel present, easily available, etc...
Brand strategy, like a lot of strategy disciplines, is only as useful as the people that execute it. That's why we see so many decks that feel out of touch, they are created to 'wow' the people that need to sign off on it but there is no connection with the execution. That's why I cringe when I see strategy decks that have way to much fluffy bullshit, inflating the words to make strategy 'feel' valuable. Strategy is hard work, so are the branding and marketing efforts that need to build on it. A solid platform without solid execution is useless.
I have personally seen the value brand strategy can have, as an internal motivator, as a way to build brand, meaning, and recognition. But I have also seen cases where brand strategy was unnecessary, redundant, not helpful or even damaging the business.
We need to understand the challenge at hand and see if brand strategy is the right solution, if not, let that organization move on to your competitors without remorse. If so, do it intention and motivation and you will create heaps of value.
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