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03/05/2017

Branding is a bad investment

Never thought that blogs can radically change the point of view. But it happened to me. Consistent and systematic caveats Geoffrey James, author of the blog, “Sales Machine”, relative to marketing techniques used in B2B, have forced me to reconsider own knowledge and experience and a more critical look at traditional methods and techniques that we’re taught in business schools. In particular, we will focus on Branding.

 

All managers today are well aware of the role of brand in business. Popular brands are useful to make easier the promotion of the product and eliminate the need for extra time to explain the difference in price. This rule works in both B2C and B2B. However, what is behind the concept of “popular brand”? What is more – “hyped” or “brand”?

Jeffrey James has repeatedly insisted that branding is a set of marketing techniques, has very little to do with the perception of the brand. Moreover, if branding is to give too attention, in B2B it’s just bad! In the article “Branding is a bad investment” (Brand Marketing = Bad Investment: More Evidence) we are talking about what good brands are formed not by promotion, but by the cool products and the best consumer experience. And this is true for all markets. As an example, he cites Apple products – iPod was fine, and Think Apple Tv is busted from the market. The brand is the same, but the real consumer experience is different – in the first case, great, the second mediocre.

Branding, as a marketing tool is dangerous in the case when the company pays too attention to marketing techniques and too little at the expense of what we receive a great experience. In B2B (and here begins the differences) the role of the service, personal relationships and, in the end, quality and reliable product is much higher than in B2C. Therefore, over reliance on methods of branding (from an expensive brand platform and next – PR, logo, packaging, advertising, sponsorship…) may lead the company to a completely unnecessary and, more importantly, useless costs. This does not mean that these techniques are not needed. However, we are talking about or, rather, moderation. And a lot of marketers write about it, giving examples.

From my own experience B2B can briefly cite two examples on this subject. The first is a large international company that spent (including in the CIS) million euros in the company rebranding. One company continued in 2002-2003, and the other started a couple years ago. If you look at the tasks that were decided by the company, the effectiveness of these expenses is more than doubtful. Customer loyalty or overall decreases or increases, and in some areas, the company simply loses market position.

After hearing in business schools about brands and branding, the management has decided to spend a decent (as for a small company) funds the creation of the brand platform, to increase the budget for public relations. The results are also questionable – it did not affect the results, but, on the contrary, many other tasks of initial level, such as building a customer database, the participation of marketing in the development of relations with customers, etc. – has not been resolved, that really backfired then in times of crisis. A similar danger Hobbies “classic” branding is confirmed by many other authors – for example, Michelangelo Celli MarketingProf, arguing imaginary SEO (again, with MBA) on the need for other approaches in B2B.

For the sake of objectivity it should be noted that supporters of branding enough in camp B2B marketers. British Agency B2B international believes branding is useful and necessary.

Summing up. Such a discussion is very interesting. What themes and nuances are clearly visible in these discussions:

  • A radical view: Branding is not marketing B2B, and fashion included with B2C and business schools.
  • Assessment of effects: Classic branding + its place in the structure of large companies (including the creation of separate positions in the discipline of SEO) can be harmful because it costs huge amounts of money do not give anything in return for the company. Passion branding for small businesses is also dangerous – there is no need for this to be followed by 2-3 dozen of their clients, at a time when the company (and marketing!) there are more urgent tasks.
  • Recognition of the obvious (?) important: the Brand is obviously important. However, the Brand in understanding of the unique Value that is perceived and understood by the consumer when contact is created using the Best Experience – a real high-quality products, customized solutions, human relationship, service.
  • Formation of difference IN B2B to promote and shape the brand is impossible without sellers. The main reason is “wide” messages and promises that carry the Brands need to adapt, landing, highlighting the fact that you need that particular client, and most importantly, in converting promises into real value. And this is a big contrast to B2C.
  • Help in positioning: there is also a problem that is rarely discussed – for example, how well brands help to differentiate and position their products. In some cases, at least in industrial B2B markets, big brands are suffering a kind of blur, because they are so large. What unique differences in its products it promotes, for example, the brand Siemens? Even if marketers find such, or perceive it with our clients?

So, the debate continues. In them.

And we? What is your experience? What do you think of branding in B2B? Or we have a branding in a number of cases of dangerous or inadequate technique in B2B? What should the marketers to build strong brands in B2B?

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