Jocelyn Turlan explains why strong branding is becoming more important, and marketers need to look beyond advertising to get it right.
Intangible value is key to the modern economy. Yet the majority of effectiveness research focuses on the payback of advertising, rather than proving the importance of investing in the brand.
New studies on effectiveness are published all the time. However, much of the “effectiveness science” that marketers rely on is based on papers that analyse advertising effectiveness: IPA effectiveness research by Les Binet and Peter Field, Kantar’sBrandZ and the Ehrenberg-Bass Institute’s research. As a result, effectiveness research about the brand is often through the prism of advertising best practice.
The existing research varies in methodology and philosophy, but broadly relies on some form of qualified awareness achieved through broad reach. There is ample evidence that awareness and reach deliver long-term growth, but it’s a view that forces us to think about branding as an enabler of advertising. The brand just becomes an input for advertising – with tools from visual identity and value proposition, to positioning and tone of voice to create communications.
We see it all the time, from the BMW brand refresh to Burger King new logo. Branding work is often reduced to an icon or the latest evolution of a brand’s KBAs. There is little or no mention of how the work is impacting culture, business or vision. It’s what’s visible on the pack, the sign off at the end of the ad. That makes it hard to justify the role of brand because it means brand is a building block, but not a multiplier. The plumbing rather than the engineering.
Brand building in the digital economy
Many modern digital brands and start-ups rightly see branding at the convergence of strategy and culture. Whether it’s Spotify, Wise or WeTransfer, branding isn’t only an exercise of visual differentiation. It’s the catalyst and the main vehicle of the brand story, both internally and externally. Strong branding, therefore, isn’t about the right logo. It’s about the right narrative and how this narrative evolves and comes to life in culture. To do this, we need to go beyond tangible assets. It’s a shift we observe today with many brands: the increasingly important part that intangible assets play in their business.
Brand stories that go beyond a brand deck
Classic advertising effectiveness models show a formula for revenue while branding, on the contrary, helps a company bank on how their vision excites people. A brand can unlock capital to deliver on its promise. We’ve seen it with story stock like Tesla, but it also gives companies like Amazon the opportunity to immediately finance new endeavours, such as moving into healthcare. In other words, brand can help create intrinsic value and make a strong brand purpose believable to stakeholders and consumers.
Intangible value drives modern brands success
The stock market remains a story of taking advantage of the gap between expectations and fundamentals, between the price of a stock and its true worth. In recent years, this has become harder to measure because of the fundamental shift from tangible to intangible capital. A shift from an economy that mostly relies on factories, building and logistics to a service economy that’s powered by softwares, ideas and employees.
What makes modern companies more attractive to investors, and talent and consumers, is not their ownership of physical assets, it’s the design, the innovation and the creativity that enables the company to deliver on its purpose. The value of a business is increasingly measured in intangibles – the aspects that makes your company – your brand – unique, aspirational and trustworthy. The most valuable asset of your company isn’t its supply chain or its stores. This can be replicated. It is in your philosophy (Patagonia), your workforce (Lush), your set of routines (Slack), your culture (Netflix), your priorities (BBC), your story (British Airways) and more.
Branding is the force behind all of these intangible assets and brand is the tangible manifestation of a company’s intangible assets. Brand is what makes your company’s intrinsic value audible to investors, talent and consumers. It’s the distinct nature in a sea of sameness.
In summary, the role of a brand is to deliver value and facilitate access to better talent, cheaper capital and stronger storytelling for stakeholders and consumers. That’s why you should invest in your brand.