What's the Value of Branding?

Branding is the most expensive, most cost-effective, and least understood marketing discipline. When done correctly, branding decreases the cost of future tactics and increases the effectiveness of communications.

What is branding?

Before we can understand its value, let’s discuss what branding is. It’s simple. Branding is to a company as character is to a person. In other words, a brand is the character of a company. It is the description of who a company is. This includes what the company is like (emotional attributes) and what the company does (functional attributes). In this way, just like character forms the basis for interpersonal communication, branding forms the foundation for all corporate communication.

Branding is an audience experience created through a collection of ideas and images. Among others, this includes a company’s vocabulary, attitude, tone, style, design, colors, and the tools used to communicate with others.

While the definition of branding is simple, the development and understanding of it is complex. The challenge with branding is that the development of a brand and guidelines usually occurs over months, while character formation continues over years. Also, branding follows a conscious theme while character development is a mostly unconscious process. These make branding both challenging and expensive. This is one reason why branding generally is not well-understood or well-practiced.

1- Branding is a Capital Investment

A well-conceived brand has an extended, valuable shelf life. Foundational work, like branding, should not be seen as an expense. Rather, it should be viewed as a capital investment that is useful over a 3-5 year period. In this sense, one can imagine amortizing the cost of branding efforts over time. Viewed this way, a solid $100,000 branding effort, valuable over 5 years, costs just $1,600 per month. This is nothing to pay to gain the manifold increase in marketing effectiveness that a well-conceived brand offers.

2- Good Branding Makes Future Tactics Easier and Less Expensive

A strong, high-quality brand will make all other communication efforts easier. In fact, when a company’s brand is well thought out, all future marketing and design projects will be executed quicker and will therefore be less expensive. A well-conceived brand makes all future collateral work, such as postcards, brochures, and reports, less time consuming to create. This is because a strong brand provides an effective, strategic template or pattern from which every communication is derived. So, a successful branding effort will decrease the total cost of marketing and design efforts over time.

3- Good Branding Makes Communication More Effective

A well-communicated brand will further a company’s business goals. A brand defines the first (and continued) impression to potential clients, customers, employees, and partners. Therefore, it is important that a company’s brand communicates the appropriate ideas to their audience. A brand determines the messages and vocabulary that will be most effective when communicating with particular audience segments. Therefore, an effective brand makes it easier and faster to help the audience understand the communication, saving time, decreasing expenses, and ultimately increasing revenue.

Effective Branding is Worth the Time and Expense

While it is possible to obtain inexpensive branding, it is not recommended. Inexpensive branding rarely defines a company’s foundational message and attitude as it should. Low-cost branding is likely to result in projecting an inadequate message, or worse, the wrong message. Repeated brand miscommunications can endanger the success of a business. Therefore, it is always a smart decision to invest in good branding.