Top 7 Branding Mistakes That Cost Companies Big Money
These insightful tips can help your company avoid spending big money on an unsuccessful branding effort.
7. They don’t measure it. Companies often put significant resources into branding but fail to measure the result. They may think their tracking it by measuring sales and revenue but those metrics are really a function of marketing, not the overall branding effort. For example, even a company with a poor reputation can run a well-funded marketing campaign and temporarily increase sales and revenue. Companies struggle to utilize metrics for assessing their overall, short- and long-term branding efforts. One solution is to track reputation in a consistent, meaningful and longitudinal way. It will help reveal if the branding efforts are yielding results or missing the mark.
6. They forget about the primacy and recency effects. People remember their first and/or most recent experience, if anything. It’s a cognitive bias hard-wired into most of us. There’s a reason that people competing for attention often want to present first or last. So, if a customer’s first or most recent experience with a company is a poor one, that’s what they’ll remember. A true branding effort, therefore, creates a consistent, predictable brand experience for customers and other stakeholders in order to ensure every encounter is a positive one. Failing to understand basic human nature can harm an overall branding effort. Behavioural science and economics are increasingly important in marketing because they help marketers understand human behaviour and decision-making. Ignoring these dynamics could undermine your entire branding effort.
5. They fail to align and coordinate their efforts across the company. Brand is a top-to-bottom, coordinated, consistent, cohesive effort designed to elicit a certain reputation amongst certain key stakeholders (i.e., the public, customers, investors, etc.). These three Cs – coordination, consistency, cohesion – are so important because of the frequency effect. The frequency effect is the phenomenon where people begin to feel comfortable with, and positive about, something they encounter that delivers the same positive experience over and over again. When they feel comfortable with something, they are more likely to want to experience it again and again. There’s a reason every McDonald’s in the world is pretty much exactly the same. They want to provide their customers with a consistent, coordinated, cohesive experience, no matter where they are. If a company’s efforts are not coordinated, consistent and cohesive, customer/user/stakeholder experience will always be different and the frequency effect will never take hold.
4. The branding lacks authenticity, relevance and transparency. Great writers like Nick Johnson have detailed this at length. Brands belong to consumers and stakeholders now and those folks can’t be tricked. They want the real thing. They want those that they support to stand for something. Between regulatory disclosure, social media, and employee activism, no company can hide what it truly is. Every company must be transparent instead of masking its true beliefs because most people can smell a disingenuous brand a mile away. If a company supports a cause simply for some easy publicity without otherwise living those ideals when no one is watching, people will find out. If a brand effort lacks authenticity, it will fail. If a company talks the talk without walking the walk, it will fail.
3. The branding effort fails to consult the people who matter the most – stakeholders. The folks that a company should care about the most are the best source of what the brand truly evokes. Stakeholders will tell a company what an company’s reputation is. Once it knows, it can decide if it like it or wants to change it. If the company is doing stakeholder analysis and management as part of a strategic communications system, it’ll be able to keep its finger on the pulse of the people most important to the company’s success and update its branding efforts in order to bring about the desired reputation.
2. The branding effort amounts to nothing more than new visuals. Some companies think brand is a new logo, new website skin, new letterhead, and new signs. These are just visuals that are a part of an overall organizational brand. The key part is the top-to-bottom. cohesive organizational change that aligns all efforts to ensure a desired reputation is brought about amongst stakeholders. Too many companies think branding is just the customer-facing visuals that go on a billboard, digital ad or website. If that’s the entirety of a company’s “branding” effort, it has paid an awful lot for some nice graphic design.
1. They forget that brand is the input and reputation is the output. Brand is the essence of the business – how it walks and talks and operates. More importantly, though, brand is the attempt to elicit a certain reputation amongst the company’s stakeholders. Most companies forget that. Brand is the effort and reputation is the result yet most companies don’t actually put any thought into the reputation that they want their branding efforts to achieve. As a result, they end up not really knowing if their brand efforts are succeeding because they don’t bother tracking their reputation. It’s like a politician that runs in an election but doesn’t bother to check the results.