Why startups need branding

Whether be ignorance or short of funds, startups often ignore an important spoke of the company wheel. Why should startups take ‘branding’ seriously?

Image Courtesy: Maksim Kabakou / Shutterstock

Image Courtesy: Maksim Kabakou / Shutterstock

In rapidly commoditising product, service and technology industries, branding’s role as a strategic platform for creating, communicating and delivering customer value has grown in importance for both, startups and established businesses. It is goes beyond elements of communicating corporate identity (i.e., name, logo, tagline and jingles) and corporate image building.

Branding in today’s context is an organisation-wide commitment to deliver on your promise to your customers. The promise perspective mandates that everyone in the organisation has a role to play in working together across functions and divisions to consistently deliver on the brand promise.

Founders and key stakeholders of startups have an important and strategic role in clearly defining and communicating the promise in terms of the functional, emotional and aspirational benefits or values that differentiates their brand from the competition. A clear and compelling brand promise will also build resonance and inspire confidence in customers, partners, potential investors and other stakeholders.

For long-term growth and sustainability, startups also need to align the brand with the company’s vision, strategy and values. I would like to propose an alignment framework that will help startups achieve sustainable growth by aligning the pursuit of brand leadership with market share leadership while strengthening customer intimacy. The underlying objective is for startups to aspire to operate in the “sweet spot” which is exemplified by sustained revenue and profit growth supported by strong brand leadership and loyalty.

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The strategies for pursuing market share leadership, building brand leadership and strengthening customer intimacy require organisational commitment, strategic prioritisation and execution based on constant due diligence of our brand value proposition and to seize opportunities for leadership and creating greater “stickiness” with customers.

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The alignment framework can serve as useful guide for startups to evaluate, prioritise and develop strategies based on product, company and industry life-cycles:

  1. Achieving market share leadership requires the organisation to concurrently pursue cost leadership across its value chain, improve the efficiency and effectiveness of its supply chain and build a strong and supportive partner eco-system through strategic outsourcing and channel partnerships.
  2. Building brand leadership requires organisational commitment to innovation, design leadership, building a dominant business or technological platform and delivering great user experiences
  3. Strengthening customer intimacy requires enhancing the emotional connect through branding, delivering quality customer service and care, building a strong brand community of key opinion leaders, brand advocates and evangelists and experiential delivery models.

An example can be seen by Green Dot, founded in 2011, as a green fast food concept in schools. Epitomised by the tagline “Eat Green Feel Good”, Green Dot has a clear brand promise that is supported by the belief that eating vegetarian food has a greater purpose and everyone can make a difference one meal at a time — whether to enhance one’s health, combat climate change or feel good from eating a meal. Green Dot’s priority is to build brand leadership driven by creative and tasty vegetarian cuisine and supported by well-designed stalls in educational institutions. Its platform of “We want to help you Eat Right” by offering delicious and tasty meat-free meals that meet the daily nutritional requirements creates strong resonance among environmentally and health conscious consumers. This in turn enables Green Dot to build customer intimacy and brand advocacy among youth and adults. It’s ability to align its brand with its environmentally-friendly values and strategy will enable it to differentiate and achieve market leadership in the competitive F&B space and enjoy sustainable growth.

This article is contributed by Dr Prem Shamdasani, Associate Professor, NUS Business School. Dr Shamdasani will be speaking more on this topic at InnovFest 2014, an event organised by NUS Enterprise.

The views are of the author, and e27 may not necessarily subscribe to them

e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested to share your point of view, please send us an email to writers[at]e27[dot]co

Dr Prem Shamdasani

Dr Prem Shamdasani is Associate Professor of Marketing; Associate Dean, Executive Education; Academic Director, Asia-Pacific Executive (APEX) MBA Program; Co-Director, Stanford-NUS International Management Program at the NUS Business School, National University of Singapore. He has co-authored two books including one of the leading books on focus group research entitled, Focus Groups: Theory and Practice, for Sage Publications (USA). His research publications have appeared in the leading regional and international journals and include the Journal of Consumer Research, European Journal of Marketing, Journal of Advertising Research, Asian Journal of Marketing, Asia Pacific Journal of Management and the Journal of Retailing and Consumer Services. He is an external resource expert on marketing, branding and retailing to various trade and government agencies such as the Singapore Retailers’ Association, IE, Singapore Tourism Board, SPRING, Institute of Policy Development, Prime Minister’s Office, Ministry of National Development and BusinessWeek’s CEO forums.

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