Often companies feel like they need a “change”, a refresh, to reinvent themselves or to give themselves a different image or new identity to improve their business. They often think this can be achieved by rebranding. So after spending a lot of money on a new brand, they wonder why nothing has changed or improved for their business.
I worked for an agency where I was involved in twelve rebranding projects in one year. Out of all of them I would say only three could be considered successful AND were justified. The others just needed to implement effective marketing. Changing your logo will not fix underlying issues; in fact it could do more damage than good.
The reason for such a high failure rate is that changing the tangible aspects (color, shapes, fonts, images) of a brand does not mean you have changed the brand promise. In essence, a brand is a promise to a customer of what they can expect to receive, both good and bad.
The brand promise is delivered through the service delivery model. This model has to reflect and align to your new brand AND its values.
For example, many years ago I worked with an IT company that was launching a new service. We undertook an exercise to determine their brand values. Because it was new technology, customer service and support were key attributes to minimize the risk for customers of adopting a new company and new technology – for example, we will be here 24 hours a day, 7 days a week for you. This flowed through to the brand promise and all the collateral material.
Four weeks after the new service launch, I called them to see how things were going. There was no answer, in fact no answer for two days. So, I went down to their office… but no one was there. I waited for 45 minutes until someone turned up. Apparently the launch went so well, that all their staff were out on-site and no-one had time to answer the phone!
Four weeks after that they called me because all their new clients had cancelled as a result of not being able to get in contact with them! This shows that if you make a “brand” promise, you need to build a service delivery model to ensure you keep it.
So what is the approach you should take to re-doing your brand? Branding needs to start with a clear statement of what the company’s value proposition is and how it will deliver competitive advantage. The functional areas of the business (operations, sales, marketing, R&D etc) then need to be aligned to deliver that… i.e. the service delivery model. If this is done well, then significant brand equity can be created.
Brand equity literally means “the value of your brand”. For example in 2002 the Coca Cola brand was valued at US$70b. That means if you just wanted to buy the brand (not the assets or company iteself, but just the logo), it would cost you that much.
So why is brand valued so high? Because of future cash flows due to customer loyalty to the brand. They are not buying a beverage, they are buying Coca Cola. That’s right, brands on their own have value.
So some things to consider before rebranding:
- What is the key business issue you are trying to resolve?
- What are the objectives?
- Is rebranding going to address the key issue and achieve your objectives?
- What is the brand promise and values? What do they need to be?
- What changes do you need to make to the service delivery model to align to them?
- How are you going to measure success?
- And last but not least, audit marketing materials and determine your budget. Rebranding can be a very expensive exercise.