Our family has been committed to eating healthier foods lately for health reasons. It has been a transition to buying organic, buying local produce and shopping at the Co-op.
I’ve learned to read labels and rely on new manufacturers that I wasn’t familiar with before. The relearning of buying habits has been challenging for me, but also interesting to see what an impact the branding manufacturers have on consumers like me. Branding is a critical strategy for attracting new customers and retaining old ones.
When you think about the brands that you purchase, what is it that makes you prefer one brand to another brand on the shelf?
Ask this question to 10 people, and you will most likely get 10 different responses. However, there will be a common element found in all of the responses – trust.
A brand represents the relationship between the seller and buyer and trust is an integral component of any relationship – business or personal.
After all, if you cannot trust a company or product to do what it says it will do, the relationship is weakened and eventually destroyed. The brand is what creates the bond between the buyer and seller. It is the backbone of all of the “soft stuff” that builds trust in your product and your company.
That’s why in a world where products and services are moving at an accelerating pace toward commodity status, those companies that have a brand people trust are able to grow profits and market share.
What exactly is a brand and why is it important that it be managed?
In today’s economy, brands represent the heart and soul of the organization. In a broader context, branding is the process of creating, nurturing and sustaining a beneficial, mutually rewarding relationship with customers.
The brand makes an implicit promise to the consumer, and this is what allows the brand to create a distinct and preferred position in the marketplace.
Small businesses have the ability to create, nurture and sustain relationships with their customers.
One new brand our family has found great success with is Nature’s Path Cereals made here in Whatcom County. Nature’s Path manufactures a line of flavorful, healthy cereals. Most of their products are certified organic and most are made from whole grains.
They are committed to making a healthy product in an environmentally sensitive way. Well, all that is nice – but the real convincer was we liked how it tastes.
We started buying their cereal because we trusted the store we bought it from – we trusted the brand of the Co-op.
From there we developed a relationship with Nature’s Path through a positive experience with one of their products. We liked that they were made locally, organic and tasted good. Our relationship expanded into other cereals and products. Think of branding as a relationship that shouldn’t be taken for granted.
In most small businesses, the relationship with the customer is present but not nurtured. Without nurturing the relationship between the company and its customers, there is little incentive for the customer to increase her loyalty to a company.
When a competitor offers a better price for a similar product or service, the weak brand (relationship) provides no glue to hold it together, and the customer defects. If only the small business owner recognized the importance of nurturing these relationships, customer loyalty would increase and the bond between the company and its customer base would be strengthened.
The long-term result is a brand that is preferred, a customer base that is loyal, and increased profits for the small business owner.
Despite the fact that small businesses are in a unique position to leverage their relationships with consumers, most do not actively manage their brand.
Whether we accept it or not, each time we touch the consumer (verbal or nonverbal) we are communicating our brand. This includes the way we answer the telephone, product packaging, pre-sale service, post-sale support, product quality, on-time delivery, and promotions to name only a few points of contact.
This is in addition to what most people consider branding elements: advertising, logos, colors and other “marketing” activities. Branding is not advertising and does not require significant capital investments. Branding, at its core, is all about relationships.
Nature’s Path creates relationships with kids through its EnviroKidz line of cereals. The boxes are covered with animals, puzzles, and fun facts on the environment.
They use their “live long, eat well” slogan in everything they put out to the consumer. The message reinforces their brand and builds relationships with the target market that wants to eat healthier and live longer. They are consistent and integrated in their brand and use it throughout their company and in their external communication (letterhead, logo, signage, packaging and web site).
One critical aspect of brand management is to refocus your company’s focus from competitors and capturing market share to being clearly focused on the customer.
Remember, branding is building relationships, customer relationships. Compare this relationship building to finding a spouse – you simply do not put on your best designer clothes, walk up to the first person you see and propose marriage.
Sure you look great and your vocabulary is impressive. But you have not introduced yourself properly nor developed a relationship with the prospect. A better approach is to recognize that relationships are built over time, and begin by asking for a first date.
If things go well, second and third dates follow. After a relationship (i.e., trust) is established, then you are ready to make a proposal for marriage. Expecting an advertisement or two to close the deal between the consumer and your business is like proposing marriage to the first person you meet.
It simply does not work. Creating and nurturing the relationship with your prospect, however, does.
Is your company well branded? What is your company’s relationship with your customers? Do you have unbreakable relationships with your customers?
All activities that communicate who you are must lead to building trust and confidence with consumers. Remember, your brand is the backbone of all the “soft stuff” that builds trust in your products and your company.
Small businesses do face branding challenges. The challenge comes from the lack of discipline to actively manage your brand in a world where customer loyalty is being torn as companies focus on price instead of differentiation.
Branding is challenged by apathetic owners, managers and staff.
The good news is that small businesses are in an excellent position to build long-term relationships that are profitable for both the customer and the business.
If you have built and continue to nurture trust with your customers, you are well on your way to increased profits and customer loyalty.
— Tom Dorr is the director of the Small Business Development Center at Western Washington University.