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Almost every company talks about brand, but do they really understand what it is? Greg Lowe talks to author Martin Lindstrom and other experts on how branding can make or break your business.

It used to be easy.

Find a wild cow, heat up a piece of iron with your own unique symbol on it, burn it into the skin of the unimpressed bovine, and hey presto said steer belongs to yours truly.

If anyone came with a mind to rustle your cattle, you could string ‘em up from the nearest tree or gun them down in the street. That’s just the way it was in the Wild West.

Today, while some companies may still act like the cowboys of times past, branding itself has become much more sophisticated.

Hot metal has given way to graphic design, flashy adverts, expensive marketing campaigns, conceptual launches and corporate positioning. Products too have diversified, and the market place is flooded with a wide range of goods and services that would stagger the imagination of any 18th century herdsman.

‘Branding’ itself has perhaps become the hottest business issue of today. It is the uberbuzzword, and most enterprises, from sole traders and SMEs to financial powerhouses and multinational corporations, are fast realising that if they want to compete effectively, then they need to separate themselves from the herd and create loyal customers by building their brand.

But if branding is such a big issue, why are so many companies just getting it plain wrong?

In the quest for clarity in a world brimming with managementspeak, business buzzwords and myriad advice gurus New Arrivals seeks out leading local, regional and international branding experts and asks them what this business is all about. They say that if companies want to pay more than simple lip service to the concept of branding, they must go beyond the logo and explore and implement systems through which corporate values are embedded, evolved and communicated to clients.

True differentiation cannot be created in a design agency. It neccessitates a complex appraisal of how a business works, from its CEO, through the HR division to those who control the marketing, and beyond – incorporating every individual involved in the organisation and the execution of its business/services.

WHAT IS BRAND?

If branding is to be considered as an essential attribute of any business that cannot be reduced to mere marketing communications or corporate design, how can it be usefully defined and why is it so important?

James Stuart, former Saatchi & Saatchi man and founder of Hong Kong-based consultancy The Brand Company, thinks branding is the business issue of the day as it is the key method for differentiating one company from another.

“The set of perceptions that people have of you is the key differentiator between you and your competitors, because your products and customer services can all be copied, it’s the most important thing in business. It is the one thing that is sustainably differentiating.

“Our definition of brand is a perception that someone has of you. That is not just a consumer, it could be a shareholder, a member of the media, it could be a member of staff. The ultimate aim of any organisation must be to have its stakeholders think of it in a positive way.”

Brand Sense author Martin Lindstrom, who gave a Bangkok seminar on ‘sensory branding’ last April, specifically links branding with emotional experiences of a company or its products and services.

“The definition of a brand is to add emotions to a product, to create product differentiation, if the product is impossible to copy then the brand becomes very strong and it becomes possible to charge a higher price for it.”

Dolchai Boonyaratavej former CEO/chairman of DYR (Thailand), founder/president of Brandscape, and author of the “Brand View” column in Brand Age magazine, defines brand in a slightly different way.

“A brand is created from the net impressions a consumer has in their mind, which are generated by their collective sensory experiences of a product, service or company.

“If you do it the right way brand becomes a valuable asset that creates long-term value. ”

BRANDING MYTHS

While branding tops the charts of essential business topics of the day, many companies are still getting it wrong when it comes to creating their brand. The biggest misconception seems to be that branding is all about logos and marketing, and all it takes is a well-executed design brief to successfully rebrand a company.

“Some misunderstand branding as advertising, total communication or corporate identity, it’s not just identity it’s the communication and the behaviour of the company as well” says Dolchai. “Most mistakes focus on advertising, ad hoc short term management, and not the core values of the brand. This may create stunning advertising but can doesn’t deliver the core values of the brand and is inconsistent.

“This can be very damaging as brand is about perception, if consumers are confused what you are all about, what your values are, you’ll have a problem.”

Many of these problems arise from the word branding itself, Stuart puts bluntly.

“‘Branding’ itself is a wholly inappropriate term. Something that was originally defined as a branding iron to stick on a cow to make sure you didn’t lose livestock. ”

He calls for a reappraisal of the issues, pointing out that as brands exist in the perceptual realm of consumers, in real terms companies don’t really own their brands. Those on the receiving end of interactions with its services, staff and marketing campaigns do.

“The brand resides not within the company, but within the minds of the stakeholders,” he says. “For example, when Fedex says that it has to be there overnight, that’s not their brand unless people believe it to be true. If HP say ‘invent’ then that’s not the case unless people think they are inventive. ”

DELIVER ON PROMISES

As consumers start to see through the Emperor’s new clothes, the days of cynical marketing where companies simply communicate what they want people believe about what they do, rather than what they actually do, may be numbered.

“What we [the branding industry] really need to do is help companies deliver on their promises, not communicate yet more promises, ” says Stuart, citing United Airlines as a prime example of bad branding.

For 30 years United told customers to “Come fly the friendly skies,” but by the mid 1990s it had been voted the rudest airline in America.

“It was an absolute disaster, ” says Stuart. “Is that just a marketing game when everyone knows it’s an exaggeration? No, it’s bullshit. It’s unethical and it’s bloody awful business.”

Lindstrom points out other brands which have lost ground and continue to fail to achieve their potential.

“McDonald’s have failed in a massive way, and  Microsoft is very much a hated brand, ” says Lindstrom. “It’s very rare that we actually talk about brands that we hate, but Microsoft is on that level. ”

BRAND EQUALS PEOPLE

Every time customers interact with a company, or its products and services, they are left with a lasting impression, something which can make or break a brand. Bearing this in mind both Lindstrom and Stuart point to an often overlooked critical element of branding – the human factor.

“You have to think about every aspect of your brand, which is not just graphic design, smell, and so on. It’s also your staff,” says Lindstrom. “Another issue is to work with a community, strong brands like Apple and Harley Davidson have communities of strong brand supporters. It’s almost like people preaching about your brand.

“Forget about just making sure you have beautiful ads, think about how every hot point [contact consumers] have with your brand on a daily basis, is affecting your sales.”

Considering the role of each and every individual in the organisation is essential, according to Stuart. Without doing so, profits may continue to rise but brand won’t be built.

“The most important driver of the brand, without any doubt, by the proverbial mile, is the people.

“So in that sense, why is it typical that the human resources director is not deeply involved in a company’s branding efforts?”

LEAD BRANDING FROM THE TOP DOWN

Strong business leadership from the top down is an essential element of brand building. While human resources, finance and marketing can all work together, the CEO needs to lead by example in terms of embedding and emanating a business’ core values – the foundation of the brand itself.

“Ultimately the chief branding officer, if you like, has to be the CEO or the chairman,” says Stuart. “You can look at any study from around the world where brands have been successful. The most important critical success factor is if the top person is driving it, not just supporting it.”

THE ASIAN ISSUE

Cultural differences exist in the commercial world, and attitudes and approaches to doing business in Asia, and the lack of understanding of the value of branding, serve as prime examples of this.

“I think the biggest problem is the brand manager. You must have a very efficient brand manager who is knowledgeable about brand building, otherwise cannot leverage the brand to become global, ” says Dolchai, commenting on the situation in Thailand.

While Dolchai’s comments are not exclusive to Thailand itself, other aspects can be tied down to the quintessential nature of business on the continent.

“It’s not easy in Asia because there is still a very short-term tactical approach to business, ” says Stuart, adding that many companies here only set financial goals, claiming long-term corporate goals are not appropriate for them.

Stuart rejects this as short-termism.

“It seems to be OK for the world’s richest companies to have goals that guide and provide all sorts of improvements in efficiency. It makes decision making easier. If you know what your brand is about then you know what is appropriate for that brand and what is not. ”