Stay the course
Greg Dolan is co-founder and CEO of Keen Decision Systems. He can be reached at greg.dolan@keends.com.
Thirty-three percent. That’s how much you can boost your company revenue1 if you present your brand consistently.
A well-established presence in the marketplace means you can: charge a premium price for products or services; build customer loyalty; and make it more difficult for competitors to attract the same base because consumers perceive the products of well-known brand names as better than those of lesser-known ones.
However, as we head into a potential recession, many businesses reflexively cut back on discretionary expenditures such as marketing, which owns the company brand, and advertising. History tells us it’s a mistake to do this.
Research2 reveals pulling back on advertising hurts a brand in the long term, with sales crippled both during and after a recession.3 This was accurate during the 2008 recession, where it took brands that shut down their advertising three to five years to recover their market share. However, brands that sustain advertising investment and maintain a brand presence during a downturn can increase sales during and after.
The value of strong brand equity
A strong brand starts with brand equity. This is the added commercial and social value that a product or service carries over the same product or service without the name. This value can include the consumer’s awareness of the brand, associations with it and perception of quality. The added value can be positive or negative.
Businesses with high brand equity have a distinguished reputation and brand recognition among consumers, making it easier to launch new products or expand into new markets. Brands can even sell or license their brand to generate additional revenue. A prominent brand typically equals success.
Building brand equity requires a long-term, strategic approach that focuses on creating positive customer associations and experiences. It’s also an ongoing effort. Consider that 74% of the S&P 100 companies rebranded4 their business in the first seven years. Maintaining outstanding brand equity requires companies to avoid resting on their laurels.
Five ways companies can build positive brand equity
The companies that build the most positive brand equity and not only survive but thrive through recession do the following five things.
1. Provide high-quality products or services. Consumers’ purchase decisions get heavily swayed by their perception of your products. If they deem your product high-quality, you’ll gain positive brand equity. Moreover, consumers will be more willing to pay a premium for your products.
In the age of social media channels like TikTok, which is currently experiencing a “deinfluencing” trend5 with more than 200 million video views, it’s critical to ensure you price products according to their actual value. Today’s consumers, especially Gen Z, quickly call out brands for putting heavy price tags on products and instead recommend cheaper, just-as-valuable “dupes,” as TikTok jargon calls them.
Use your marketing messaging to highlight the top three to five benefits or proof-points of your product’s or service’s quality. Create case studies, ask for customer reviews on relevant websites and solicit user-generated content on social media to encourage customers to share images or videos of them using your product. As 95% of consumers read online reviews6 before making a purchase and 58% say they would pay more for a brand’s products with good reviews, it pays to shout positive customer feedback from the rooftops.
2. Use consistent branding across all touchpoints. The potential touchpoints through which a consumer interacts with your brand have exploded. You must now consider your website, social media channels, digital ads, e-mail, corporate signatures, PR, direct mail, billboards and brick-and-mortar stores (if you have them). You must ensure your logo, color palette, language and overall look and feel remain consistent across all these touchpoints. If you don’t, consumers won’t connect the dots that your brand is the same across these channels.
Consistent branding helps establish a clear and recognizable identity, which can increase brand recognition and recall, leading to more trust in the minds of consumers. It also helps differentiate a brand from its competitors and reinforces its unique value proposition, making it easier for customers to connect emotionally with the brand. Consumers interact with six to eight touchpoints7 before purchasing and research8 shows that purchase intent improves by 90% and brand perception by 68% when consumers view consistent messaging across multiple channels.
A great place to start is with brand style and usage guidelines, which ensure all messaging and brand assets remain consistent and aligned with your company mission, vision and values. If your company has rebranded recently, ensure all your updated logos, fonts, color schemes and messaging are consistent across all touchpoints and available to the necessary employees. This includes ensuring that visual assets like logos are sized appropriately for the various channels. You can also encourage employees to use company branding assets on their own social media profiles, such as LinkedIn, to help them become brand advocates.
3. Build loyalty through excellent customer service and gathering feedback to improve the brand continually. More than half of global consumers name customer service “very important”9 in brand choice and loyalty. Almost two-thirds have stopped doing business with a company over poor customer service. You must deliver seamless, consistent, helpful customer service experiences to retain customers and boost brand equity.
How you execute customer service must be unique to your specific brand. Some succeed with in-house teams, others with outsourced call centers and chatbots. What’s important to prioritize is having a dialogue with your customers and then quickly and relevantly resolving their customer service requests. Consumers don’t want to speak or type into the ether, get handed off to support person after support person or have a machine point them to resources that aren’t specific or helpful to their problem. Customize your customer support, regardless of channel, and customers will stick by your side.
Also, don’t forget to gather feedback through customer service surveys or follow-up e-mails. This intel is critical to improving not just your customer support functions but also your overall brand. Maybe your website is hard to navigate, resulting in an uptick in customer service requests. Perhaps the same product is causing problems for a large number of customers. Whatever the issues, it’s best to hear them from the source and let them know you’re using their feedback to improve.
4. Connect with customers on an emotional level by communicating your brand values and story in a way that resonates. You can nail the previous three points and still have negative brand equity. The acceleration towards a digital-first economy means it’s more complicated than ever to earn and keep customer loyalty. It’s simply not enough to have innovative and differentiated products and services. You must also deliver an outstanding customer experience rooted in emotional connection. “An optimal brand experience demonstrates emotional sensitivity and sets the bar for all brand expectations moving forward, regardless of category or sector,” says Deloitte.10 That’s why emotions, not logic, influence 95% of purchasing decisions.
Due to the recent times we've lived in and the social responsibility younger shoppers want brands to embody, companies should convey values that speak beyond just dollar signs and connect to the greater good. More than half of consumers have either cut down on or completely cut11 shopping with businesses they think behaved inappropriately in the areas of environmental or social issues. Research by Edelman12 shows that Gen Z believes brands must take a stand on issues that affect its employees (60%), its customers (59%) and how the products are made (55%) and that communications should reflect this via advertising and on their website (62%, on average across items).
Thinking about your brand, do you support charities? Are you trying to reduce your carbon footprint? Have you made it part of your mission to hire more female, BIPOC and LGBTQ+ individuals? Think beyond what you sell to how to try to impact the world positively. Be authentic in conveying this messaging13 because today’s consumers can smell a rat from a mile away. And above all else, be human.14
5. Develop and execute marketing strategies through effective advertising that build a positive reputation and convey the unique benefits of your brand.
Businesses with robust omnichannel customer engagement retain, on average, 89% of their customers,15 compared to 33% for companies lacking in this area. This means you should use a variety of marketing channels to get your message across. But omnichannel marketing doesn’t mean you haphazardly execute campaigns in various channels and call it a day. What someone sees in a display ad should tie into what they see in a social media app. Use your marketing channels to tell a story, using different channels as your chapters.
Regarding the best marketing strategies, think sight, sound and motion. Video is excellent for brand awareness and streaming services are on the rise. Consumers are constantly on their phones, so mobile and social media are other worthwhile channels to pursue. E-mail also made a comeback during the pandemic. Regardless of your advertising channels, be consistent, coherent and relevant.
Use actual humans in your marketing assets, incorporating diversity and inclusion. Your customers are individuals from different backgrounds and circumstances, so you must consider that when trying to connect with them.
A bright future for brand equity
It’s impossible to predict how long a recessionary environment could last. That means companies must maintain their marketing efforts to maximize brand equity. They can consider alternative cost-saving measures, such as adjusting their marketing mix, optimizing their ad spend or focusing on more cost-effective marketing channels. If they maintain their spending, investment and R&D innovation through difficult periods, they will remain competitive when the economy recovers.
For brands to continue operating and growing in a challenging environment, they must continue investing in building their business, brand and equity. Whatever their position, it’s imperative that companies think about the forward trajectory and not get mired in the difficulties of the present because not doing so may wind up ceding market dominance to another brand. By continuing to advertise, companies maintain customer engagement and set themselves up for future growth.
References
1 State of Brand Consistency, MARQ. https://info.marq.com/resources/report/brand-consistency
2 “Report: cutting ad spend guarantees losses in a recession,” Analytic Partners, April 28, 2020. https://analyticpartners.com/news-blog/2020/04/report-cutting-ad-spend-guarantees-losses/
3 Nirmalya Kumar and Koen Pauwels, “Don’t cut your marketing budget in a recession,” Harvard Business Review, August 14, 2020. https://hbr.org/2020/08/dont-cut-your-marketing-budget-in-a-recession
4 “The first quantitative M&A brand benchmark,” Landor & Fitch. https://landorandfitch.com/en/articles/thinking/the-first-quantitative-m-and-a-brand-benchmark
5 “#deinfluencing trending hashtag on TikTok, see #deinfluencing analytics,” TikTok Creative Center. https://ads.tiktok.com/business/creativecenter/hashtag/deinfluencing/pc/en?countryCode=US&period=7.
6 “Brand rated: ‘nine out of ten customers read reviews before buying a product,’” GlobeNewswire News Room, January 13, 2022. https://www.globenewswire.com/news-release/2022/01/13/2366090/0/en/Brand-Rated-Nine-out-of-ten-customers-read-reviews-before-buying-a-product.html.
7 “How creative consistency across touchpoints improves brand perception,” Marq, December 13, 2022. https://www.marq.com/blog/how-creative-consistency-improves-brand-perception.
8 Cross-Media Ad Effectiveness Study, IAB, January 26, 2021. https://www.iab.com/insights/cross-media-ad-effectiveness-study/.
9 “State of global customer service report,” Microsoft Dynamics 365, March 2019. https://info.microsoft.com/rs/157-GQE-382/images/2018StateofGlobalCustomerServiceReport.pdf
10 Tech trends 2019: Beyond the digital frontier, Deloitte Insights. https://www2.deloitte.com/content/dam/Deloitte/br/Documents/technology/DI_TechTrends2019.pdf
11 Kristina Rogers and Andrew Cosgrove, “The CEO Imperative: Make sustainability accessible to the consumer,” EY, June 24, 2021. https://www.ey.com/en_us/consumer-products-retail/make-sustainability-accessible-to-the-consumer
12 Richard Edelman, Brand Trust; The Gravitational Force of Gen Z, Edelman, June 20, 2022. https://www.edelman.com/trust/2022-trust-barometer/special-report-new-cascade-of-influence/brand-trust-gravitational-force-gen-z
13 Robert Williams, “Gen Z wants brands to be ‘fun,’ ‘authentic’ and ‘good,’ study says,” Marketing Dive, July 8, 2020. https://www.marketingdive.com/news/gen-z-wants-brands-to-be-fun-authentic-and-good-study-says/581191/
14 Isaac Nikolai Fox, “Social-led brands are the future,” Hootsuite, July 12, 2022. https://blog.hootsuite.com/social-led-brands-are-the-future/
15 “Why an omnichannel strategy matters,” Internet Retailer, December 31, 2013. https://www.digitalcommerce360.com/2013/12/31/why-omnichannel-strategy-matters/