A common question is: “How much is a brand really worth?”
No one wants to hear “it depends,” but like so many other things, your brand value escalates with how much you invest in it. According to BrandZ, brands account for about 1/3 of the value of Fortune 500 companies. The combined value of all brands in the top 100 ranking increased by 126%, from $1.4 trillion (’06) to $3.3 trillion (‘15). Of the top 100, Apple and AT&T gained the most at 1,446% and 1240% respectively over the past 10 years.
Ok, so not all of us are Fortune 500 companies. How do we measure the value of a brand? There are three common measures that many use to determine if their brand is adding value to their company:
How many people in your target market are aware of your brand? Some companies like Hallmark Cards, Inc. and McDonald’s are ubiquitous and have off-the-chart awareness numbers. Remember, that their customers are essentially anyone who breathes. They sell widely-used products. On the other hand, how many people are aware of the brand of a regionally distributed product or a product niche—maybe a bank or a BBQ sauce?
What matters is: does YOUR prospective audience know who you are and what you stand for, and do you know your awareness and share numbers–or how many of that group are aware of you and how many buy from you. You can’t sell to them if they don’t know you exist.
Once they try your product, do they enjoy it enough to try it again? First, they have to know what they purchased; is it well branded? Secondly, it has to function as promised OR the complaint has to be resolved in a more than satisfactory way. Finally, the price paid must be in line with the benefits received so they feel it was a good value. It doesn’t hurt to find a way to stay in touch with them, either; remind them of your brand, that you care about them and want them to come back.
This measure has come to replace brand satisfaction, as satisfaction is an attitude whereas loyalty is a behavior. As a result of repeated positive experiences, customers keep coming back and often buy more each time.
Over time, loyalty can transcend into advocacy, where customers become brand ambassadors recommending your brand to others.
I consider myself an advocate of Southwest Airlines and Enterprise Rent-A-Car—two brands that rarely fail me, and when they do, have always come up with a satisfactory response. Which brands are you an advocate for? Why?
Now, apply that insight; craft your brand into one that others will choose to advocate for!