Six Important Reasons Why a Strong Brand is Necessary for Your Small Business

Six Important Reasons Why a Strong Brand is Necessary for Your Small Business

December 17, 2017

Beyond just a memorable logo, good branding increases the value of a company, provides employees with direction and motivation, and makes acquiring new customers easier. So what exactly is a brand?

The short answer: Everything!

A brand represents the general public’s perception of a company’s reputation, advertising, customer service and logo. When all of these parts of the business are working well, the overall brand tends to be healthy. On the other hand, we all probably know a company that offers excellent products or services, but has a tarnished brand due to poor customer service.

Let’s take a look at six important ways a strong brand impacts a business and why it is so necessary to surviving in today’s competitive business environment.

1. Branding Improves Recognition

One major component of your brand is your logo. While some people think branding and a logo are interchangeable or the same thing, they’re not. But think of how we instantly recognize the golden arches of McDonalds or the simple, but powerful eagle of the United States Postal Service. As the “face” of a company, a logo design is critical because that simple graphic will be on every piece of correspondence and advertising. A professional logo design is simple enough to be memorable, but powerful enough to give the desired impression of your company. What are some of the logos that you instantly recognize?

2. Branding Creates Trust

While experience and longevity perhaps creates more trust than anything else in business, what if you don’t have that? A professional appearance is paramount to building credibility and trust. Simply put, people are more likely to purchase from a business that appears polished and legitimate. We cannot avoid the fact that emotional reactions are hardwired into our brains and those reactions are very real influencers on what we buy and where we buy them.

3. Branding Supports Advertising

Advertising is another component of your brand. Both the medium chosen and demographic targeted for advertisements builds a brand. If your advertising focus is too narrow, your company runs the risk of being “pigeon holed” and losing their ability to expand into new markets. If your advertising focus is too broad, your company fails to create a definable impression of what it is in the minds of potential customers. For example, some newer companies that target Millenials are advertising on social media platforms and developing smartphone apps as they know they must be seen where their potential customers are located.

4. Branding Builds Financial Value

Companies that publicly trade on stock exchanges are valued at many times the actual hard assets of the company. Much of this value is due to the branding of the company. A strong brand usually guarantees future business. Whether a company is in the position to borrow funds for expansion or rolling out to an Initial Public Offering, being perceived as more valuable will make the process advantageous for the owner of the company. The greater a company’s devotion to build its brand value, the better the financial return from its efforts.

5. Branding Generates New Customers

Branding enables your company to get referral business. Would it be possible for you to tell a friend about the car you love if you couldn’t remember the brand? A large reason “brand” is the word used for this concept is that the goal of branding is to leave an indelible impression. As the most profitable advertising source, word of mouth referrals are only possible in a situation where your company has delivered a memorable, positive experience with your customer.

6. Branding Inspires Employees

Many employees need more than just work; they need something to work toward. When employees understand your mission and reason for being in business, they are more likely to feel that same pride and work in the same direction to achieve the goals you have set. Having a strong brand is like turning the company logo into a flag the rest of the company can rally around — and they’ll pledge their allegeance as long as you give them a reason to.

The most profitable companies, small and large, have a single thing in common. They have established themselves as a leader in their particular industry by building a strong brand.

If you’d like to explore the options of how you can strengthen your brand, we want to hear from you. Contact Louis Mamo & Company today for a free, no obligation consultation.