The hidden value of brand (what’s yours?)

You have to work hard to keep your figure – but it’s worth it.

Many years ago, when I worked in the high-tech sector, I sat in a presentation given by my boss. He was a tall, distinguished man with rebellious locks and a deep, resounding voice. You could easily have mistaken him for a priest, delivering a riveting sermon to a rapt congregation. Which might very well have happened, as he’d studied at one time for the priesthood. Luckily for me, though, he saw the light and moved into marketing. He was a joy to work for. In the presentation, he talked about brand value. It’s a nebulous term, easy to bandy about, but difficult to pin down. How much is a brand worth? How much does ‘reputational damage’ – much in the headlines these days – cost a company in dollars and cents, or pounds and pence? Not easy to calculate. Or so you’d think.

Do the (marketing) maths

Grabbing a marker pen, he rapidly scribbled on the white board. Buildings? X. Physical stock? Y. Cash reserves? Z. Equipment? A. Debtors? B. And so on. It was a very simple balance sheet. Together with all those assets, he listed liabilities, which were very few indeed. He then subtracted the latter from the former, and came up with a figure for the actual nuts-and-bolts value of the company. Next to this figure, he wrote the market capitalisation of the company. This was before the internet bubble burst, and the number was huge. Subtracting the ‘actual’ value from the market cap left it scarcely diminished. Et voilà! he concluded, with a flourish of his pen. Right before our very eyes was the brand value. It was the hopes (minus the fears) of the market. The belief and trust of the users. The reliability of the products. The warmth and friendliness of the support people. The confidence that the salespeople inspired. The feel-good factor that our software created. Plus the promise of a better life (which all software offers, natch), of shorter working days, of happier staff, of smiling families and of the sunlit uplands of a bright future.

Think of number

Have you ever stopped to ask yourself about your brand and its value? You might start with the basics:

What baggage does your brand carry?
On the whole, is the experience of working with your company positive or negative?
Does each customer touchpoint add to, or subtract from, the brand value?
What’s the the tone of voice of your corporate communications, and does it have a positive or negative influence on the brand bottom line?
If your company were a person (I know, I know, but it’s a useful question to ask) what would they be like? Is that personality an asset or a liability?
Are you doing anything that’s damaging or diminishing your company’s brand value?
Is there anything you could do right now to change that? A quick fix, an easy win?
If so, why aren’t you doing it (instead of reading this blog post)?

Brand value (and its close relation, brand equity) is an odd thing. Because it’s intangible, and largely unquantifiable, it can go ignored. But it’s a crucial part of of your company’s marketing strategy, underpinning everything you do. It oils the wheels of the sales machine and opens up possibilities for growth and expansion. So guard it jealously and always remember how easily it can be lost. Because it’s not just a figure; it’s the heart and soul of your company.

Here endeth the lesson

It’s a point that my ex-boss brought home with eloquence and style, as always. His truly was a missed vocation. But then, perhaps he found his calling in the high-tech arena. The company, by the way, was Microsoft. And since then, it’s taken a bashing brand-wise, as its supremacy has been challenged by an army of internet upstarts. Once written off as the next IBM, it’s kept reinventing itself, and looks set – along with Nokia – to be an unexpected beneficiary of the Apple/Samsung US patent ruling. All these years on, and X+Y+Z+A+B, minus all the bad bits, still adds up to a pretty decent number. That’s the value of brand. Find out more:

Brand new: after a mere 25 years, Microsoft unveils new logo (Daily Telegraph).
So yesterday: Microsoft logos through the years at CNET.

Kevin Branding, Marketing.