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Brand Strategy for Startups – Omar Merlo, Imperial College Marketing Professor, and Fellow of Cambridge University

Omar

Branding is something a lot of startups don’t understand fully. It’s an intangible concept therefore it’s difficult to pin-point the nuances and to ascertain its deficiencies and effectiveness.

We spoke with Dr. Omar Merlo, Assistant Professor of Marketing at Imperial College Business School and a Fellow at Judge School of Business (Cambridge University, UK).

Stating the concepts of branding simply, Dr. Omar shares some valuable pointers for startups. Hope you enjoy the read…

When we talk about branding in the context of startups, the first thing to realize is that the rules that apply to big established brands apply to startups too although the environment in which the startup operates amplifies the speed to the market and makes things quicker.

If you are a small startup, everything starts from the idea that is “central to the brand”. That idea doesn’t necessarily have to be a complex one; actually sometimes, the simpler the idea, the better because it’s easier to communicate a simple idea in a consistent way to the customer.

What matters about the central idea of the brand is that it is connected to everything that the  business does. For a startup, that might be something as simple as just creating a visual identity for the brand, making sure that everything within it is consistent. The images, associations, colors; all of these elements that you want, should reflect consistency both internally and externally. Consistency establishes distinctiveness & uniqueness in the minds of your customers not only from a functional perspective but also from an emotional point of view.

What are the various aspects of a brand?

One thing to realize is that a brand is not just logo or design or visuals but it’s everything that’s used to communicate and differentiate the product/service. There are two aspects that drive the power of the brand:-

  1. Awareness or familiarity with brand – There needs to be a certain level of familiarity with your brand. Customers need to recognize the brand and therefore visualization is very important. However, typically that’s not enough and the problem with inexperienced marketers is that they rely too much on recognition but ignore the second important aspect of the brand which is-
  2. Unique Association – The brand needs to be able to make strong, favourable, unique associations in the mind of customers. The distinctive elements forming the basis of your brand associations could be anything, such as the brand’s key attributes, its benefits, how it makes you feel, etc. They need to be positive and strong enough to make customers think and act in a certain way. These associations are all about what is better (not just unique) about your brand.

When a startup combines both these points, it leads to brand strengthening and contributes towards building the Brand Equity.

A lot of times, startups question as to which one I should invest in first? Do I get myself out there and be recognized or should I work on developing the association? The answer is do both however especially when you get started, focusing on building your association is more important.  The first thing you have to do is to bring out the ‘uniqueness’; the great idea that is at the core of everything you do, you have to work it out. You have to infuse the brand with elements of differentiation and relevance before you can start to think about putting yourself out there.

Startups are cash constrained. What are easy ways for startups to establish brand association?

Marketing doesn’t necessarily have to be expensive although the more resources the better.

In order to establish the brand association, of course, the free channels such as the internet is one of the effective ways of reaching out to your customers.

Another way to establish your brand association is to leverage secondary associations where you leverage the brand equity of others. These could be influential bloggers, review magazines, PR etc.

Communicating your brand message

The most important thing to remember while communicating your brand message is ‘Consistency’. Make sure your communication is consistent with the central idea of your brand. Apply the consistency rule and minimize the risk of communicating the wrong message. However, there’s potential of reputation damage online with a wrong message.  If you do happen to send out a wrong signal, deal with it as quickly as possible. The rule of thumb in communicating with your customers is to adopt a level of transparency; let them see through your brand.

Is there a way for startups to measure brand equity?

When you are just going to get started, you don’t have any sophisticated tools to measure how your brand equity is developing. The more established companies use valuation methods. At early stage, best way to measure brand equity is direct contact with customers. You can get a very clear idea how your brand is performing just by talking to your customers. I would always advise people to use qualitative techniques; meet your customers, talk to them and find out how they asses your brand, what levels of differentiation and relevance they see in your brand. As you scale up, you can use other methods that are available for free to see how much buzz your brand is generating and how much attention it’s gathering on social media.

There too many social networks out there. Should a startup be everywhere to publicize its brand?

Use a social network only if you have something to offer; something to give to your customers to take away. Just putting up a page and expecting people to like will not make you a brand. Think about what channels you are going to use and how you are going to use them not just for your benefit but for the benefit of your customers. Work out a clear strategy and a plan that will drive brand value and customer value. Don’t be just there for the sake of it!

Is there a timeline for startups to keep in mind to see if their brand strategy is working?

It varies dramatically. I wouldn’t say that if your brand has not taken off in 6 months, give up. Each brand is different; the level of acceptance in the market differs. There’s no rule of thumb, sometimes you just need to go out there and try it!

 

CASE STUDY

Just as I was converting Omar’s interview into a post, I stumbled across this conversation between a founder(Shirish) and a possible customer on a Facebook group who provided the feedback (Adarsh). While I do realize that Shirish was just seeking feedback, however being aware of the pillars of your Brand Equity (Recognition & Association) from early on can fast track the startup and send out strong messages from the onset of its journey. I thank Shirish & Adarsh for letting me use their conversation as an example to clarify the Branding concepts:

Shirish: After putting lot of efforts in designing, here we come up with the first beta look http://bit.ly/1eK9uZ3 Check out and let us know your valuable feedback and suggestions for our new website.

Adarsh: I wouldn’t personally buy from you for the following reasons

1. You seem to be just another web hosting provider
2. Seems like you are resellers of other US based hosts
3. You are new. Why should I trust you with my website when there are hundreds of other web hosts who have been in business for several years?
4. You seem to be offering other services like graphic design and so on in addition. Gives me the impression that you are not too focused on your core competency
5. No money back guarantee which is a standard for all web hosts

Hopefully you can take some of these pointers and implement something which will help overcome user objections to buying from you

Shirish:  Thank you, what you have told is good, I will have to implement something which will differentiate from just being another reseller web host. We actually are more then reseller hosting as we have tie-ups with DCs in more then 3 locations. But yes, I will have to design the website properly to give the right impression.

Referring to the section ‘Aspects of a brand’ above, this is a classic case of a startup that is yet to figure out its Association before it goes on to being recognized. The central idea of Shirish’s product (whatever that is based on; could be price, ease of installation, continued support etc.) should reflect consistently everywhere in his touch points with the customers. It should elicit a positive brand association in the customers mind for example perception of quality, affordability etc.

As final words, real life and real customers are not like Facebook groups where they help each other like a community. Most potential customers will look at something, form a perception and not make the effort to clarify their perception. Therefore, each communication, every touch point with the customer is a step towards building brand equity.

If you like this article, please do share this with your peers and benefit the startup eco-system.

We thank Dr. Omar Merlo, for sharing his insights.

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COMPILED BY:

Nidhi Kapoor – Co-Founder at FounderMates

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