Author: Olivia Schwartzman

Branding is a company-wide effort that takes time, energy, and resources.

It’s not easy.

It’s not cheap.

We’ve talked about the many benefits of branding. But you might still be asking yourself where branding shows up in your revenue reports, and how you can measure the actual value of a branding effort.

The answer is multifold.

While marketing focuses on specific, targeted campaigns, branding is an evolution. In marketing, there are set points to measure your return on investment, but with branding, it’s not as clear-cut. In branding, it’s all about building value.

But what does that mean?

And if you can’t measure it based on income and expense, how do you know if branding is actually worth it?

Let’s break it down.

What do we mean by value?

There are two primary reports for measuring a business: profit and loss vs. balance sheet.

The P&L statement compares income and expenses, and then makes a simple subtraction of the two to determine profit. The balance sheet compares assets and liabilities and uses equity to force them to balance.

Marketing is on your profit and loss statement.
Branding is on your balance sheet.

Branding and marketing have different end goals. Marketing is about developing a return on investment within a set period of time. Branding is about building value over the long term.

Marketing shows up in your profit and loss. You can compare directly what a marketing effort costs and how much business was generated, and see if you made a profit.

But branding aims to build value and is more abstract. It’s located on your balance sheet. Unlike a simple income versus expense calculation of marketing, your brand is an asset, which means it can grow and change, as well as be bought and sold.

The same is true for the timeline of returns: marketing is short-term, and branding is long-term. Marketing creates sales in the moment, but branding builds longevity and loyalty.

Branding builds brand equity.

In short: just because branding doesn’t lend itself to a direct income vs. expense comparison like marketing, that doesn’t mean branding isn’t important. The benefits of strong branding resonate both internally and externally across consumers and employees. Measuring the impact of branding on your organization requires a different perspective, a focus on long-term value rather than short-term gains.

What is brand equity?

Brand value is also referred to as brand equity: the accumulated value of a company’s brand assets, both financially and strategically.

In practice, brand equity is the overall market strength of a brand.

What is your brand worth in the marketplace? High-value brands are memorable and authentic, and inspire loyalty in their customers. Brand value is a huge asset – it’s how you keep customers coming back in an ever-changing marketplace, even when you have a myriad of competitors.

When your brand is valuable, consumers trust you.

Think of a brand like Coca-Cola. The value of the Coca-Cola brand is most likely equal to, if not exceeding, the value of all the physical assets of the company, like warehouses, factories, offices, personnel, etc. Imagine if Coca-Cola sold its brand. The company that bought them would have an instant foothold in the market. And that’s not because Coke is delicious, it’s because people know the brand.

It goes to show that the power– the value– of the company isn’t just in its production capacity. It’s in the strength of their mindshare.

Brand Value in Action

Brand value isn’t all abstract. The impact of a valuable brand can be seen in concrete, measurable ways. A strong brand makes your sales and marketing teams, as well as your internal hiring practices, much more effective, directly increasing revenue.

Powerful branding supercharges your sales team. 

• • Consumers use a bold brand as shorthand, so your sales team doesn’t have to introduce everything about you in every sale.
  • By developing a well-recognized identity that communicates an authentic concept, people feel a connection to the special offering you provide. That connection forges loyalty, which rises above features and benefits.
  • Branding makes it easier for your sales team to close deals and get new business because their targets already know what the company is about and are connected to it through the brand.

Branding also boosts your marketing efficacy.

Marketing is a short-term investment and can reap great returns. But you will end up wasting time and money on disparate marketing campaigns without a solid brand identity and equity to base them on.

• • When your brand is strong, your marketing efforts are more focused and therefore more effective.
  • With a solid brand, marketing and branding work in a symbiotic relationship, each reinforcing the other.
  • Your branding efforts create a loyal consumer base, while your marketing efforts strengthen your brand identity by getting your message out to the right people.

Further, there are internal benefits to building a strong brand. 

• • Your brand develops a sense of spirit among the people who stand behind them..
  • Spirited organizations are highly effective because the hearts and souls of the employees, investors, and contractors are committed to their success.
  • Recruiting and retaining top talent is easier when you have a great brand because your visibility and position within your industry are clear.
  • With the right people in the right roles who care about your company, the business will run better– and generate more profit.

Brand Value: 5 Key Takeaways

1. Brand Equity is on the Balance Sheet

Executives tend to look for ROI on branding initiatives as a way to determine budget levels. But equity isn’t found on your P&L; it’s on the Balance Sheet.

Brand equity is an asset, so consider the budget as an investment. The ROI will be long-term, contributing to the valuation of the organization

2. Brand equity is often greater than book value

In many cases, the value of a great brand can eclipse the value of a company’s tangible assets.

Brands like Coke and Google drive valuations far higher than the sum of their facilities and inventory. Taking an investor’s approach to branding opens up the opportunity for high rates of return.

3. Branding drives more than revenue 

Branding does increase revenues by making your sales, marketing, and hiring more effective. But it’s also more than the sum of its parts– a strong brand can drive up the entire value of your organization.

Branding is a long-term, capitalized investment that delivers benefits over time.

4. Brand value is largely emotional

The degree to which your customers form an emotional connection with your company has huge ramifications for your longevity in the marketplace and ability to capture mindshare.

It is through branding that customers form an emotional bond with your company, elevating the interaction from a simple transaction to something much more meaningful. That’s what gets them to return, choosing you over a competitor. This translates to strong brand loyalty even when your offerings change.

5. Branding is a strategic investment

Branding is an essential element of your strategic plan, requiring an integrated consideration from leadership. Attempting to assemble piecemeal funding from the marketing department alone is like leveraging investing for retirement with loose change.

With a solid understanding of the value of branding, it’s clear why you need to allot funding and energy to such a critical initiative.

Branding is an all-encompassing process that reverberates internally and externally through your company over time. The accounting complexity required to develop a strong ROI formula for branding makes it difficult to project returns. But that’s not a reason to discount the value of branding.

The results for companies with strong brand equity speak for themselves. If you’re dedicated to building long-term value in your company, it’s important to keep an eye on your brand.

If you’re ready to build value in your company through branding, we’re ready to help. As a top branding agency in Los Angeles, we’ve helped hundreds of companies across industries sharpen their position and clarify their place in the market.

Branding aligns your team and connects your customers. The value of that cannot be overstated 

Change is the only constant. But timing is essential.

Whether you have your standards defined or not, the truth is that brands are in a continual state of flux, internally or externally.Branding is most successful when companies embrace this fact and move with the market and respond to customer sentiment, rather than trying to stand still. While taking a real look at your brand is always beneficial, there are times of change that signal a branding effort is not only helpful – it’s imperative. How do you know when it’s time to rebrand?

In this essay, we’ll go over six major triggers that should prompt a rebranding conversation. We’ll also talk about what rebranding is, why it can be both risky and rewarding, and what to do if you’ve found it’s really time to rebrand.

Contents

1. What is rebranding?
2. Why you shouldn’t rebrand
3. Six trigger events for rebranding
4. Where do you go from here?

What is rebranding?

Rebranding is the process of shifting how a brand is perceived through repositioning and strategic messaging. It’s more than just changing your logo– a true rebrand will alter your market position, the big idea from which all external brand manifestations grow from. Rebrands can result in huge evolutions, including changes in naming, communications strategy, visual tone, and internal restructuring. Brands are the basis for forming tribes, so a rebrand needs to be carefully design to embrace your loyal followers— not to offend them.

Successful rebrands always begin from in-depth research to determine the root of the issue. It’s important to know whether the issue triggering the rebrand is a symptom or a cause. Is your brand having trouble maintaining relevance because your core message no longer resonates with consumers? Or is it due to lack of brand governance in an overly siloed organization that struggles to consistently deliver that message across media touch points? These are different problems with different solutions. Both require a look at your current brand, but in distinct ways.

Why you shouldn’t rebrand

Change is not easy. The process of transformation can even be painful, requiring you to take an honest look at what is and isn’t working. Rebranding takes time and effort– it’s not a light undertaking. If it’s the right time for the process, the rewards can be huge. If it’s the wrong time, the risks can be disastrous. Let’s look at an example.

Tropicana is one of the biggest rebranding fails to date. In 2009, the juice company invested $35 million in a rebranding effort that culminated in a package redesign. The iconic carton with an image of an orange and a straw sticking out of it completely changed. It was replaced by an entirely new logo (a sans serif font), a wrap-around image of a glass of juice, and all new messaging.

The idea was to modernize the Tropicana brand. But the backlash was swift. Consumers hated the bland packaging, and Tropicana went back to their original carton in a matter of weeks. It was a major waste of time and resources, not to mention a $20 million loss in sales. What went wrong?

• • Looking in the wrong place: Wanting to be hip and cool isn’t a reason to rebrand. That’s an outcome, not a trigger. Maybe it was time for Tropicana to evolve, but they didn’t know where or how the transformation needed to occur. Clearly, their customers love their packaging– meaning they funneled the resources for the rebrand into the wrong place.
  • Change all at once: Change is hard. Rolling out a new logo, messaging strategy, and package all at the same time is difficult. How you communicate the changes is just as important as making the right changes.
  • Misaligning design and strategy: The whole point of rebranding is to make you more yourself– to more closely align the internal intelligence (the why) with external appearance (design). Tropicana’s new packaging does the opposite– the modern, ascetic design clashes with their positioning as a family oriented comfort brand. The disconnect was immediately clear to consumers.

Tropicana took a $55 million hit on the rebranding. This isn’t to say rebranding is futile. It’s just to say that it’s not without pitfalls. And it makes it even more essential that you’re doing it for the right reasons.

6 trigger events for rebranding

INDUSTRY CHANGE

1. Losing market share to a competitor: Competitive attack is a sign that your brand is not yet memorable and irreplaceable enough to win out in your industry. Uncovering what your brand is missing and repositioning it based on your unique advantages is an investment that will pay off for years to come.
2. Launching a new product or service: When launching new goods or services, your brand is in a particularly sensitive state. If the face you present to the outside world is shifting, your brand needs to shift, too. Expanding your offerings can be great for your brand, but without a clear strategy, new facets of your brand can serve to muddy the water and confuse consumers. Brand focus is key to memorability, recognition, and loyalty, so it’s imperative that your brand encompasses your new offerings in a way that is true and authentic to your brand position.

ORGANIZATIONAL CHANGE

3. Not attracting/retaining top talent: Branding isn’t only for influencing your consumers – it also has a major effect on your employees. With both internal and external benefits, good branding can breathe life into your company. If you find that your team is not excited about your company and not proud to pass out your business card, the story you’re telling isn’t working. A hard look at your brand can put you on the right track.
4. Change in leadership: A change over in leadership, such as a new CEO, prompts a key time for branding. It’s an effective way to break with the past and cement a new culture of leadership and company values
5. Mergers and acquisitions: If you are diversifying your brand portfolio, it’s critical to have a clear strategy for expanding your brand or re-branding your subsidiaries. A good brand strategy will expand your reach, while a messy one can seriously damage your recognition.

EXTERNAL CHANGE

6. Reputation crisis: rebranding can be an important strategy to distance your company from negative associations. Obviously, rebranding doesn’t totally clean the slate. You’ll still have to do the work needed to fix whatever problem has caused your customers or your employees to see you in a negative light. But, when combined thoughtfully with other strategies, it can help shift perceptions.

Where do you go from here?

You’ve identified that you’re facing a trigger event. Rebranding is necessary. Now what?

• • Make sure leadership is on board.
    Successful rebranding comes from the top down. Leadership needs to be willing to change and engage.
  • Define your goals.
    What’s your vision? Defining the objectives and clearly conveying them gives your team something to rally around and work towards.
  • Be ready to open up.
    Get ready to take an honest look at what’s working and not working. The research phase of rebranding is critical and acts as the basis of any rebranding strategy. The more real and honest you can be, the more authentic your direction will become.
  • Find the right branding partner.
    Rebranding is a journey of transformation. An experienced guide with an outside perspective can lead you on the right path. Any branding agency leading your rebrand should have a proven methodology for developing a strategy and then translating it into creative assets.

Over the last 20 years, we’ve crafted hundreds of brands, and led many through rebranding at times of major internal and external transition. Change can be scary, but with the right partner, it’s hugely rewarding. Is it time to rebrand? If you’re ready to transform, we’re ready to take your brand from now to next.

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It’s often said that brand is everything.

The meaning is twofold.

At one level, “everything” refers to the make-or-break success of branding and rebranding campaigns – if you don’t have good branding, you aren’t going to have a competitive edge and reach your potential. At another level, “everything” refers to the totalizing nature of branding.

It’s the sum of all internal and external parts of your business. And the benefits of branding impact both.

The 6 essential benefits of branding

Brand is everything. It’s a huge statement.

In this essay, we’re going to break down why branding is so important – and share some of the benefits of branding.

• • What does it do for your company?
  • What does it do for your employees?
  • And what does it do for your loyal customers?

A strong brand strategy is a critically important part of building longevity in a rapidly changing market. But longevity isn’t the only benefit of branding. As a top branding firm in Los Angeles, here are some of the other benefits our clients experienced after letting us build their brands:

Internal benefits of branding

Branding impacts the very spirit of your company, which impacts your day-to-day operations.

1. Better, more engaged talent

Your brand isn’t just for your customers. It’s just as much for your employees. A part of your brand strategy process should include defining your company values, culture, and philosophy. Strong brands rally their teams around a unified mission, resulting in alignment and cooperation.

One of the benefits of branding is making people feel something for your company – and that affects your employees even more closely than it does your customers.

In fact, 72% of recruiting leaders worldwide say that employer branding has a significant impact on hiring. People want to work for a company that they know stands for something and aligns with their own sense of purpose.

2. Increased revenue

One of the most desired benefits of branding is its impact on revenue. And this is three-fold.

Branding helps qualify customers more quickly, helping improve marketing efforts and decrease acquisition costs by quickly attracting the right people who are most likely to become customers. This in turn has a tremendous impact on sales teams, allowing them to focus their time on helping prospects who are qualified and ready to buy.

Further, another surprising benefit of branding is lower price sensitivity. This means customers give less weight to price when they are purchasing from a business with an intentional brand identity.

Lastly, branding goes hand-in-hand with increased revenue because it creates loyalty and repeat customers. It’s much easier to re-engage an existing customer than a new one. And research shows that 57% of customers spend more money on brands they’re loyal to.

3. Streamlined product launches and marketing efforts

The benefits of a strong brand mean you don’t have to figure it out from scratch every time your company evolves.

Whether it’s launching a new product or service (and navigating product marketing vs brand marketing), expanding into a new market territory, or managing a new acquisition, your established brand paves the path forward.

It acts as a guiding light that empowers better decisions, streamlining complex business changes and ensuring that stakeholders are all on the same page.

External benefits of branding

Your brand affects your customers on multiple different levels.

4. Increases loyalty

This is one of the benefits of branding that straddles both internal and external parts of your company.

Customer brand loyalty is the natural effect of a positive experience, product satisfaction, and the perceived value of your offering.

Getting customers to buy is one thing– getting them to return again and again is another. While marketing may get people in the door, branding is what really cultivates loyalty. Loyalty can only be formed if customers have a reason to believe. Knowing what you stand for and what drives you as a company allows them to align their beliefs with yours.

Engaging with something they believe in is a much stronger motivator for repeat action than simply buying a product or service they want.

And as your brand loyalty grows, so too does your brand reputation.

5. Creates a stronger connection

Brands use emotional branding motivators to elevate transactions to memorable experiences. When it’s more than a purchase, people are driven to action.

They’re not just buying a car, they’re buying adventure.

They’re not just buying a computer, they’re buying innovation.

They’re not just joining a gym, they’re joining a community.

This is an incredible benefit of branding that fosters long-term engagement and staying power in a crowded market. A huge part of branding is about figuring out what feeling you want to inspire in people, then engineering the response.

We’ve written extensively on the powerful relationship between branding and emotion– check out this series of articles for more information.

6. Improves brand recognition

Strong brands are instantly recognizable through visual cues and messages.

In a crowded marketplace, you have just .05 seconds to make an impression. It’s essential that you stand out from the competition.

Having a clear brand strategy process means having a plan to align your brand voice and identity across all platforms and mediums, ensuring consistent presentation. The easier it is for customers to know who you are, the better they can make decisions. In fact, a consistent brand presentation has been seen to increase revenue by 33%.

Ready to experience the benefits of branding?

The multiple benefits of branding aren’t always obvious. Branding can have a huge effect on your business – internally and externally. Whether meant to boost your company culture, boost sales, or increase customer loyalty, a well-executed brand-driven strategy makes a major impact.

As such, you shouldn’t think of a branding or rebranding campaign as a secondary part of marketing. We are a branding firm in Los Angeles that’s dedicated solely to crafting exceptional brands.

Branding requires resources, time, and effort. By enlisting an experienced, professional team with a proven process, you can let your internal team focus on their primary roles. Partnering with a trusted agency helps bring out the authentic core of who you are. At Flux, we help companies bring their stories to life. If you’re ready to take your brand from now to next, we’re here to help.

The potential for long-term success makes a branding campaign more than worth it.

In need of branding services today for a stronger brand tomorrow?

Get in touch.