Branding and Brand Stretching
There are whole books written on the subject of branding – it’s a fascinating subject that gets more interesting the further you dig into it. In this short article I am going to pick out some of the key points that are easily overlooked when making those strategic business decisions.
What is a brand?
Many people consider a brand to be a name or identity given to a company, product or service. I believe it is much more than this. A brand should not be confused with a brand name or logo.
A brand is all about perception – perception of the intangible qualities and attributes of a company and its products and services. It’s what people think of when they come across your brand name or logo… it’s what people think they know about your offering, and how it makes them feel.
Your brand exists in people’s minds, and the perception will vary from one person to the next according to their own experiences, what they’ve heard from other people, and of course it can be influenced by your marketing.
Why is this important?
In my experience there is often a disconnect between what employees in a business think their brand stands for and what their customers and prospects think it stands for. Understanding the perceptions of your customers and prospects can put an important new perspective on your marketing strategy and can help shape your communication to these important groups.
Perceptions can change.
I remember 20 or 30 years ago, people used to make all sorts of disparaging jokes about Skoda motorcars. The jokes were not very good ones (what do you call a Skoda with twin exhaust pipes? A wheelbarrow) but that’s not the point. The point is that Skoda is now a respected brand in the mid- market. The cars are generally well written up in the automotive press, and whilst it’s perhaps not generally viewed as a premium brand, there is no stigma associated with driving a Skoda as there once was. This change in perception has taken years of hard work and investment, but it has changed.
Of course perception can go the other way too. Ratners springs to mind, where a careless comment by Gerald Ratner devastated the Ratners brand overnight. If you don’t know the story, just Google Ratners.
The development of new products and services can be a great way to generate incremental sales, to grow a business and to spread the risk that is inherent in relying upon the fortunes of just one market.
I personally had a significant role to play in successfully transforming Everest from a double glazing company that sold windows and doors to a home improvement company, still selling windows and doors, but also selling garage doors, flat roofs, driveways, solar panels, kitchens and more. This transformation worked because the brand was able to stretch across these new markets and still be perceived as credible.
As a general rule, trying to stretch a brand into a completely new market is risky and often ends in failure – not necessarily because the new product or service is bad, but because the target customer groups in that new market either have no awareness of the brand or perceive no relevance of the brand in the new market.
The Apple brand has immense loyalty amongst its customers in the tech space, but if Apple were to start selling running shoes, I’m not sure that they would succeed… unless the shoes had some technology built in.
An exception to every rule
Sir Richard Branson threw away the rule book to good effect when developing his Virgin empire. He was remarkably successful in stretching the Virgin brand across a range of disparate markets – airlines, trains, banking, wines, experience days, telecom, radio, records, gambling and more. Whilst there is clearly a skilful team driving this approach, and the investment in their marketing is huge, I think this strategy has worked for one reason above all others: the common thread has been Sir Richard himself. He is perceived as a very likeable, entrepreneurial person, and for many people, the Virgin brand is all about him. People like him and trust him and that perception of him as a successful entrepreneur has allowed the Virgin brand to stretch far further than would otherwise have been possible.
By understanding how your target groups perceive your brand, you are in a far stronger position to be able to influence their perceptions over time, addressing any weaknesses and building on your brand’s strengths. This understanding can also inform your product development strategy, helping to ensure that your new products are welcomed by your target market as relevant additions, rather than being viewed with scepticism or puzzlement.
If you need any support with understanding how your brand is perceived and how far it’s credibility might stretch, contact the experienced team at 49 Red. We’re here to help.