Another brand survey hit the stands last week. Valuing Woolworths as Australia’s most valuable brand on a Global 500 list led by Walmart, Google, Coca Cola and IBM.
Now far be it from me to dispute the rankings of such venerable authorities such as Brand Finance (or Interbrand, or any of the other brand consultancies that churn out these annual rankings), but I’m going to anyway.
Let’s start with the description the Brand Finance people give for their report:
“The study provides an opinion on the point-in-time value of the world’s leading brands. Each brand has been accorded a brand rating: a benchmark study of the strength, risk and future potential of a brand relative to its competitor set as well as a brand value: a summary measure of the financial strength of the brand.”
Now not sure about you, but that’s a nice bunch of gobbledygook. Other organisations that “rate” brands have similar amorphous, vague descriptions of their surveys and reports, but in many of them is all seems to come down to financial results – what other reason for only looking at publicly traded companies?
But in reality, there seems to be little transparency to their processes and formulas of rating, so I am not sure why I should believe anything they come up with, and generally I don’t.
A couple of weeks ago I did feature a brand list that at least had some transparency and factors assigned to their process beyond the financial. And with that, it was interesting what a different list of names emerged as the front-runners.
What many of these surveys miss and what is more relevant for the millions of companies out there who are SMEs, not publicly traded, not big financial performers, is that what you need to be a successful business is a valued brand.
So what measures can you use to figure out if your brand is valued? Because, after all that is the first step towards it being valuable. All those usual brand valuation measures of P&L, cost of customer acquisition, marketing expenses, etc, aren’t going to tell you much.
So, for an alternative view of how valued your brand is, try finding the answers to all (or even some) of these questions:
1. Do my customers come back? In other words, how loyal are your customers, how many buy from you once and then you never hear from them again? You don’t have a valued brand if you can’t keep your customers.
2. Do my employees stay put? If you are burning through staff and constantly having to replace people, you don’t have a valued brand and you are going to find it almost impossible to do Q1.
3. Where do my new customers come from? Are your existing customers telling their friends about you, are new customers finding you in the Yellow Pages, or via a Google search? What the answer is tells you very different things about how valued your brand is.
4. How much money do we spend making sure our customers are satisfied versus acquiring them? This is a valued brand kicker. If once someone becomes a customer, they get relegated to the back woods of your database never to be spoken to again unless you want to “upsell” them, then chances are have a valued brand are slim to none.
5. How many customer complaints do we get (and how many are happily resolved)? Every company gets complaints, but if they are a regular happening it is unlikely that you have a valued brand, and if the resolution involved legal action – well no need to say more there.
6. Do our partners and suppliers stick with us? The stable relationships of the extended family of your brand are just as important to it being valued as your customers and staff. They help you deliver your promises and sometimes are the last point of contact a customer has.
There are plenty of others, and I am sure a few you can come up with yourselves – something I encourage you to do. Look at your company, what it does, how it does it, the promises you make, and see if you can add three or four others to my list.
Once you have the answers, you might find yourself to be batting 100, or have a bit of work to do, but you will certainly come out of the process with a much better idea of how valued your brand is. After that, it’s a hop, skip and jump to valuable.
See you next week.
Michel Hogan is a Brand Advocate. Through her work with Brandology here in Australia and in the United States, she helps organisations recognize who they are and align that with what they do and say, to build more authentic and sustainable brands. She also publishes the Brand thought leadership blog – Brand Alignment.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
