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EXPERT WITNESS: The Idea Gardener Tom Fulcher on "Branding for Emerging Entrepreneurs – Why Should You Care?"
What is branding and why should an entrepreneur care? Branding is a part of the marketing strategy. Marketing itself is a strategic process requiring effort and commitment. The dictionary defines marketing as “an integrated process through which companies create value for customers and build strong customer relationships in order to capture value from customers in return.” Looking closely at this definition, there are two key concepts. One is the idea of a customer-centric relationship. The other is the concept of value. It is therefore important to also define value. Many think of value as “getting a good deal” or a discount. I prefer to define value as “getting something you want at a price you are willing to pay for it.” In this sense, value is more all encompassing of price as well as other factors involved in the exchange.
But how do we define a brand? In ranching terms, the brand is the mark burned into the hide of a cow, a way to differentiate one owner’s cow from another owner’s cow. This might be a name, symbol or other mark. There is some relationship then to how we use the term “brand” in marketing. Ultimately though, your brand resides within the hearts and minds of customers, clients, employees and prospects. It is the sum total of their experiences and perceptions, some of which you can influence and some that you cannot.
Creating a brand positioning Statement for new companies can be a challenging task. Most entrepreneurs have unlimited passion and are ready to conquer the world. Many can speak at length about the features of their product and are convinced that most people in the world will want it. But they cannot provide a concise statement about their brand position in the market. It is critically important to develop a position and understand the value proposition.
So where to start? An investor colleague once asked a client, “what do you do particularly well and why does it matter?” I would add, “to whom does it matter?” This might be a good way to start thinking about a positioning statement.
Traditional thinking offers that there are four primary components to a brand positioning statement: Target audience, brand name, category/competitive set and “unique selling proposition.” I always suggest that my clients consider two additional components of a positioning statement - a new starting point – “Market Pain” and a new finishing point – “Reasons to Believe.”
– Generally speaking, seek to identify the pain or problem in the market you are addressing with your solution, or at least the opportunity on which you wish to capitalize?
– Define your target audience as clearly as possible. Break your definition into three areas:
• Geography – This is technically part of demographics, but for new and emerging companies I recommend looking at this separately as it ties closely to your business plan.
• Demographics – What do you know about your audience (consider breaking your audience into a primary and secondary target)? Elements include age range, income range, gender, race, career areas, memberships, etc.
• Psychographics – personality characteristics, values, interests and other attitudinal factors. For example, if you are launching a tech product, do you want to reach innovators and early adopters?
-- This part is pretty easy, assuming you have already named your brand. If not, leave it blank until you finish the other elements and this process might help you develop the name. You can explore descriptive, invented or out of context names.
– Simply put, where else will your target consumer spend their dollars to address their needs if not with you? If you dig a little deeper considering many categories have multiple subsets, based on the uniqueness of your product/service, your target audience, your sales goals and your other marketing strategies, with whom do you wish to compete?
Unique Selling Proposition (USP)
– This is not an attempt to write the tagline used in your messaging. This is a definition of why someone in your target audience would choose you. Try to be benefit oriented, not feature oriented. Remember the earlier point about being customer-centric? Think from your customer’s perspective. Try to be single-minded with the focus.
Reasons to Believe
– While not truly part of the positioning statement, I like my clients to demonstrate reasons a target audience member would believe their USP. This provides ammunition for future marketing materials, messaging and other exercises like a SWOT analysis.
Completing this type of exercise and developing a brand positioning statement is only one step in the process of building your business. Once completed, a successful entrepreneur will examine this statement or promise and assure that its implications are carried out through all parts of the organization and in all points of contact with the target audience. “Consistency of brand contact” is critical to establishing solid footing for your brand in a believable and sustainable fashion. Every member of your team should think of themselves as a brand champion.
Once you successfully establish your brand, your business will see many benefits, including:
• Solid base from which to develop marketing and product development strategy
• Creation of hurdles for competition
• Strong value proposition helps reduce pricing pressures.
• Strong brands deliver better profitability.
• Better ability to extend into new arenas
• Strong category status helps you become a desirable partner.
• Strong brands are assets with sustainable financial value.
Good luck differentiating your cow!
Founder and President - The Idea Gardener® LLC
Twitter: TheIdeaGardener | Linkedin: http://www.linkedin.com/in/tomfulcher