What are your brand assets and how can they be monetized fully? Many think marketing and branding are nebulous intangibles that cannot be profitably managed without the risk of opening the floodgates to endless creative activity with no correspondent revenue stream.
While true in fact that the relationships between the revenue streams and corresponding branding activities are not usually as direct in time or clarity as sales activity, as the brand becomes established, especially a consumer brand, the brand value drives sales as well as most other areas of the business. For example, the difference between the book value for Coca-Cola’s machines, buildings and other tangible assets equal one dollar figure, a figure likely not nearly so different than the same sum for RC Cola, however the market values for Coke and RC Cola are no doubt quite different.
What are your business’s brand assets and what are they worth? Brand value cannot be measured precisely, only estimated, however, it can be both estimated, and maximized. Many people think of the signature brand symbols when they think of a brand, such as a logo, a tag line and a look or feel of a website. Other values include the real but not as obvious items:
- Savings in vendor and or distributor agreements
- Ability to charge price premiums based on perceived quality including a reputation of positive user experience and expectations
- Recurring revenue from customer loyalty of a base of brand loyal buyers
- Lower cost of acquiring new customers due to increased referrals and increased awareness and recall of brand symbols
- Brand extensions are less costly to launch than completely new brands because of the initial established brand following
How to Build Up the Value:
The key to building brand equity is in building a solid unique selling proposition. The brand’s unique position may be based on functional features and benefits. In consumer brands especially, intangible brand associations and emotional and self-identity benefits that symbolize consumer self-image aspirations tend to be most competitive due to the difficulty of a rival brand to break or interfere with an intangible relationship. It is always easier, less costly and less administration, to invest in a new functional feature to compete against a rival than to out do a relationship connection and ‘steal away’ loyal customers who feel part of a competitor's community.
Also, it is a well established fact that it is easier to sell a brand that is known and liked. A sale is more challenging and thereby more costly when a brand is either not known or not liked. The more known a brand is, the more valuable. The level of awareness in the market of a brand is a valuable aspect of the brand, shown in the speed of a sale or the shortness of a sales cycle.
If you are launching a new brand, consider building in consistency of brand associations and personality with the unique selling proposition right from the start. If your brand is established, consider areas that may be undervalued and review how your business may test monetizing those aspects. Also consider making intangible attributes more consistent and more prominent. Customer service that supports and clearly understands the values are a brand enhancement for example.
More information on brand equity is available in the classic Brand Leadership by David Aaker et al., Free Press 2000, or see prophet.com/insights.
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has edited and written for consumer Web sites and publications reaching nearly 50 million people. Her credits include writing and editing online and print articles, sales and training materials, marketing collateral, and advertising and PR for conusmer companies including BeautiControl, a Tupperware subsidiary's publications to women ages 20s through 50s, the WHO Foundation, Women Helping Others, MCG Magazine, Los Angeles and Seasonal Living Guide for Sam’s Club, a retailing subsidiary of Wal-Mart. Her career also includes working and living in Canada and Japan. Jean is well regarded for her market-research based approach to managing story development enabling consistently original, relevant and timely content.