Monday, August 21, 2006

Five Steps to Build a Strong Brand

In today’s highly competitive world, companies are striving hard to beat customer expectations - marketers are at work setting the right level of expectations and shaping the customer experience.

A positive brand value is created if customer experience exceeds his expectations. Over a period of time companies can build a strong brand - one with high brand value. Intel, Cisco, Google, E-bay, Wal-Mart etc., are the classic examples of how companies built a strong brand through customer experience.

Companies mentioned above started small but built a solid reputation with the customer along the way and in the process the name of the company evolved into a strong brands as well. Note that these companies sell several products - and many of these products are also branded, but the company brand is the strongest. For example - Intel’s Pentium processor, Cisco’s Catalyst Router etc., these products are market leaders in their respective segments, but customers remember the company brand more than the product brand.

In this article, I want to highlight the five steps needed to create a strong brand. This article builds on the theory of Customer relationship management & sales, you may want to read the earlier article on Levels of Customer Relationship before reading further.

  1. Clearly articulate your brand identity

    Brand Identity means what the brand means to the customer. Brand identity sets the customer expectations. A classic example is from Wal-Mart’s "Everyday Low prices".
    This statement sets the customer expectation. Customers expect bargain prices at Wal-Mart. Another classic example is ‘Starbucks’ - Starbuck coffee has a special meaning to its customers; to them Starbucks means excellent coffee served in a warm, relaxing and pleasing environment.

    The key is to clearly articulate the brand identity, and that will help you define how customers interpret it. A clear brand identity sets right level of expectations by the customer.

  2. Establish a customer value proposition

    Customer value proposition is the natural outcome of the brand identity. It is what the customers think of your brand. For example, customers think of Wal-Mart as place to get great bargains. Then that message must be communicated to the entire organization so that each department and each individual understands what it means to them. The actions of each department will then be aligned with the customer value proposition.

    For example only if all employees of Starbucks understand the customer value proposition - then they will be able to deliver an excellent cup of coffee in a warm, relaxing and pleasing environment.

  3. Define the optimal customer experience.

    Identify all contact points where customers interact with your company. To create a holistic brand experience, you need to create a consistent and compelling experience at each of these touch points.

    For example, marketer must work as a mystery shopper and see if the customer experience is consistent with the customer value proposition and brand identity. For example, marketer must see if he/she is getting the kind of coffee at Starbucks in the right environment as expected by the customer. Take an outside-in perspective when aligning each department with your customer value proposition and brand identity.

    Note that the marketer can only test the level of customer experience based on his/her understanding of customer’s expectations. There may be an understanding gap between what the customer wanted and what the marketer understood.
  4. Cultivate relationships with customers

    Relationship with customers must be treated carefully. Never assume anything about what the customer thinks of your company. It pays to be an active listener to learn and respond to the customer needs. Companies need to respond positively to customer feedback and that will turn casual customers into loyal customers, loyal customers into customer champions.In my earlier article I have written in detail about the levels of relationship a firm can enjoy with the customer. Improving the levels of relationship with customer means enhancing customer experience - thus gaining brand value & customer loyalty.

    Here again a classic example will be Starbucks. Customers of starbucks are so loyal that they are even promoting starbucks to others. Starbucks has also responded in kind - by promoting organic farming, ethical purchasing etc. These ideas were given to Starbucks by their customers.

    Another very good example is Intel. Intel sells microprocessors to computer manufacturers, the company releases new products with enhanced features/performance as per its pre-announced product roadmap. The marketing team of Intel is always listening to customer to learn what features are needed in the future products - that information is passed on the R&D teams - so that the new products will have the feature required by the customer. As a result Intel enjoys the highest levels of relationships with its customers - a level at which customers are willing to invest and co-develop new products.

  5. Strengthen your brand over time

    Enhancing the level of customer-brand relationship will have a direct impact on the brand. To build a strong brand, one needs strong customer relationships. To begin with, the first time customer starts at a low level of relationship( I call it level-1 ) and over a period of time, through series of positive interactions with the brand/company, the level of relationship can be increased to a higher level ( Max of level-6) Marketer must have a time bound plan to improve the levels of relationship which the customer enjoys with the company/brand. This will have a direct correlation with the brand value.
Closing thoughts

Customers don't buy products, customers buy relationships - This is a popular phrase in marketing. To build a strong brand, organizations must work on enhancing customer experiences and that results in a higher level of customer relationship. All this will eventually result in a strong brand. If you observe any popular brand today, you will see that company promoting that brand has succeeded in building a strong relationship with its customers.

Also see:

Marketing - Position before you communicate
External Product Positioning - Need for Clarity
Developing a Brand Position
Selecting a specific brand position
Define your Brand and determine its value
Choosing a Value Position for a Brand
Advantages of Niche Positioning
Customer Relationship Management & Sales


Natti said...

Hello Arun,
I wrote something about Intel changing its logo in my blog. Appreciate your comments.

tom said...

Thank You Arun for this concise write up on brand building. Please continue writing such informative articles.


timmysmoth said...

Hi Arun,

We're putting together an article on building a strong brand and would really appreciate your comments. The article is currently living here:

How to build a strong brand

ToMaTo-Teoh said...

thx arun for your write up, it helps me a lot. I'll be having test soon, this really helps. Thx!! Please continue to write more. (^^)