Often business leaders with a sharp focus on profit and cost struggle with the esoteric notion of a brand and, in particular, are difficult to convince about the value of the investment. As a business owner I understand their reluctance to part with cash unless they see what they get in return and that, ultimately, what they pay OUT on one side of the account book is exceeded by the amount that comes IN.
Given this skeptical mindset it is no surprise that marketing and communications people who work for these business leaders battle constant questioning about the value of prioritising expenditure on brand building, as opposed to putting money into promotional communications to drive sales.
Increasing brand value is like inflating a hot air balloon – you can see a shell or a skin expand as it fills with gas – but the hot air on the inside that produces the lift is invisible. Stay with me on this metaphor because I think it provides a helpful insight into the value that investing in a brand brings a business. Imagine I make cars – let's choose BMW for example. If BMW brings out a new vehicle, its sales people don't have convince me as a buyer about why I'd pay perhaps 20-30 thousand dollars more than a standard Ford or Holden. That's because the "BMW" name is being lifted by the invisible force of the brand's hot air balloon. On the other hand, if decided to market a new luxury vehicle that was unknown to buyers, I suspect I'd struggle and probably fail to convince anyone in the market for a new car to part with their cash – let alone pay 20-30 thousand dollars more. That set of associations and feelings that trigger when I see the logo that provides the buyer comfort that their investment is worth the money. Take the brand mark off, it is just another car.
So how does this convert into an argument about money. Well, the answer is obvious . If I did want to drive sales via advertising of unknown car I am guessing I would have to spend 3-4 times the amount of money on sales promotion and advertising to even get close to the sales of a well known and trusted car brand. That's what brand does – it is like having a giant hot-air balloon uplifting your sales strategy. Brands are about helping consumers make easy decisions. While in the short term you might see brand expenditure as a cost - in the medium to longer term that investment wisely applied should make a return in spades. How big is your company's hot air balloon? Pumped anything into it lately?