Why Branding Matters for New Companies

Our view at Stack - ClickFunnels was founded by an online marketing legend Russell Brunson and it offers several benefits for online businesses and marketers:

• Time and Cost Savings: Efficiently create sales funnels without extensive development efforts.
• Maximized Conversions: Test offers, copy, and images to enhance conversions.
• Specific Landing Pages: Generate highly targeted landing pages.
• Predictable Pipeline: Create consistent, predictable sales paths.
• Increased Sales: On average, it boosts sales of lesser products by 15%

The post Why Branding Matters for New Companies appeared first on ClickFunnels.

Everyone is talking about building a brand. 

But is branding really that important?

Yes, it is, especially for new businesses.

Here’s why…

Introduction to Branding

What is a Brand?

You can think of your brand as the overall vibe of your company. 

The more that vibe resonates with your target audience, the easier it will be for you to grow your business!

Weak Brand vs. Strong Brand

Having a strong brand means that when people hear the name of your company, they immediately know what your business is all about.

Meanwhile, having a weak brand means that when people hear the name of your company, they either have no clue as to what it is that you do or they only have some vague general idea.

For example, think of all the small coffee shops that serve decent coffee and snacks but aren’t that memorable and feel kind of interchangeable with one another. They have weak brands. 

Now think about Starbucks. The logo, the atmosphere and the beverages that they serve probably come to mind immediately. You know exactly what you can expect if you go there. That’s a strong brand!

What is Branding?

Our friend Leila Hormozi defines a brand as an association between two or more things, which is a great way to think about it from a tactical perspective.

If you want to build a brand that resonates with your dream customers, you need to create associations between your company and the things that your target audience values. 

Branding is the process of creating those associations!

Why is Branding So Important?

Branding can help you:

#1: Stand Out From the Competition

It’s probably safe to say that you can increase your market share by strengthening your brand because it will help your company stand out from the competition. 

And the lower the barrier to entry in your industry, the more important branding becomes. Why?

Because a strong brand can serve as an economic moat (we’ll discuss this concept in more detail later in this article). 

For example, anyone can start a dropshipping business, which makes it extremely competitive. However, most of those online stores are low-effort, look terrible, and have weak brands. 

Building a strong brand as a dropshipper can help you increase customer loyalty, bring in more revenue and improve your profit margins, all the while avoiding the dreaded “race to the bottom” dynamic!

#2: Charge Premium Prices

Generally speaking, the stronger your brand, the more you can charge for your products and services.

Apple is one of the best examples here: it has an incredibly strong brand that allows the company to charge much higher prices than its direct competitors. 

If someone wants to buy a laptop, chances are that they see laptops from companies like Asus, HP, and Dell as being more or less interchangeable and belonging to the same “generic laptop” category.

Consequently, if that’s what they are looking for, they will probably price shop and go with the most affordable option that has the specs that they need.

Meanwhile, that same person might see Apple laptops as belonging to a separate “Macbook” category. 

If they want not just a laptop but a Macbook, they might be willing to pay more for the same specs. Why?

Because Apple is associated with innovation, sleek design and affluence, so a Macbook might be an aspirational purchase. 

Basically, owning Apple products can make you look cool, which is why the company can charge premium prices. 

Of course, you shouldn’t blindly copy Apple’s approach to branding, especially if you are targeting a completely different demographic, because it can backfire. 

For example, when Ron Johnson, previously a senior vice president of retail operations at Apple, became the CEO of JC Penney, he decided to take a page from Apple’s playbook and turn JC Penney into a similarly hip and stylish brand.

Unfortunately, this decision resulted in one of the most infamous rebranding debacles in retail history: it alienated the company’s customer base, crashed its stock, and damaged its brand.

While learning from companies like Apple is important, you always need to ask yourself whether it makes sense to implement the same strategies in your business. Always put your dream customers first!

#3: Make Your Business More Valuable

It’s wise to set up your business in a way that makes it easy to sell should you ever decide to. 

That applies even if you don’t have any intention of selling it because you never know what the future may hold. 

The term “economic moat” is used to describe a competitive advantage that protects a company from rivals who want to steal its market share. 

There are various types of economic moats and brand identity is one of them. Generally speaking, the stronger the brand, the wider the moat and the less risky the business.

Consequently, if two businesses:

1. Sell the same products or services
2. Generate the same amount of revenue
3. Have the same profit margins

…the one that has a stronger brand will have a higher valuation because buyers are willing to pay a premium for reduced risk. 

Building a brand can help you make your company much more valuable and enable you to make way more money in an exit event.

How to Start Building Your Brand

Get Clear On Your Values

There are universal values that all businesses should adhere to such as integrity, honesty, accountability, etc. 

But beyond that, you want to decide on the values that are important to you that you are going to use as guiding principles when it comes to making business decisions. What do you want your company to stand for?

Ideally, your personal values, your company values, and the values of your dream customers should match. 

Say, if you personally believe that family is what’s most important, run your business in a way that reflects those family values and cater to families with kids as your primary target audience, building a strong family-friendly brand should be pretty straightforward!

Start Creating the Associations That You Want

Now that you are clear on what your values are, it’s time to think about the associations that you want to create in the minds of your dream customers. 

For example, let’s say that you opened a restaurant and you want to build a family-friendly brand. 

Everything should reflect that: your social media posts, your marketing campaigns, your offers, your menu, your events, your interior design, etc. 

You want people to immediately get the vibe of “this is a great place to go out to eat as a family”. 

You also need to avoid associations that are incompatible with the family-friendly brand image.

For example, if you launch a special deal for tequila shots and start running an ad campaign for it, it’s going to weaken the existing “family-friendly” associations and create new “party place” associations. 

Branding isn’t rocket science: you just need to know the overall vibe that you are going for and then focus on creating associations that support it and avoiding associations that don’t. Simple!

Protect Your Brand Image at All Costs!

Something that you need to keep in mind when it comes to branding is that one mistake can be enough to destroy a brand that took years to build.

While it may be possible to repair a ruined brand image, that will require a lot of time, resources, and patience.

Also, if what happened was truly terrible, there might be no coming back from it. Your company might be done. 

That’s why it’s so important to protect your brand image:

Make Sure That the Values You Promote are Reflected in the Way You Conduct Yourself in Your Personal Life

The way you behave in your personal life is going to affect your brand image.

That’s why the alignment between your personal values, your company values and the values of your dream customers is so important.

After all, if you pretend to be someone you’re not, it’s going to come out eventually and damage your brand. 

For example, people don’t like cheaters in general, but you know who they hate even more? Hypocrites who preach family values while being unfaithful to their spouses. 

Of course, no one is saying that you have to be an angel to build a brand – we are all just flawed human beings after all – but you do need to avoid hypocrisy because it’s bound to backfire!

Make Sure That the Values You Promote are Reflected in the Way You Run Your Business

Say, if you promote family values, your company needs to be accommodating to employees who have kids.

That might mean offering generous maternity and paternity leaves, allowing your employees to take personal time off if their kids are sick, and having a work schedule that is conducive to normal family life.

Otherwise, if you preach family values while running a company that is hostile to people who have families, it’s going to come out eventually and damage your brand.

Don’t Lie to Your Customers, Employees and Investors

This is something that is extremely easy to avoid and yet so many entrepreneurs destroy both their personal reputations and their company brands by telling lies. 

Just don’t do it!

If You Make a Mistake, Take Accountability

People who are angry with you for messing up may be willing to forgive you if you admit that you were in the wrong.

However, if you dance around the issue, make excuses or throw someone else under the bus, you’ll just make the situation worse.

Go Out of Your Way to Make Things Right

You want to be proactive about this. 

Don’t wait until a disgruntled customer starts venting on social media. If something went wrong, reach out to them, apologize, and offer help.

That can be enough to diffuse situations that have the potential to snowball into PR nightmares!

Want to Learn How to Turn Your Online Visitors Into LIFELONG CUSTOMERS?

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He used storytelling to establish himself as an expert, create a movement, and build a community. 

And you can learn how to do the same by reading his best-selling book “Expert Secrets”!

This book is available on Amazon where it has over 1,900+ global ratings and a 4.7-star overall rating.

But you can also get it directly from us for free… 

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