Branding — if done correctly — is invaluable to a business

Published: Monday, May 21 2012 9:32 p.m. MDT

Every prominent and highly successful entrepreneur has methodically established a memorable and powerful brand.

Well-conceived and implemented brands have a specific purpose and can have enormous value to a business. The purpose of this article is to introduce business builders to the nature and worth of this invaluable marketing tool.

Quite often, after I have invested in emerging growth companies, I note a company's lack of a concise brand strategy. To help the leaders of these firms with this critical assignment, I invite Mark Hurst of Connect Partners — my good friend and nationally known brand expert — to facilitate a branding session.

He has consistently worked his magic with many organizations in our area with amazing results. I have called upon him, once again, for his expertise as I write this column.

A company with a powerful brand can differentiate itself from competitors and establish itself in the hearts of customers. The process begins with finding and defining the customer and the messages to communicate to this targeted audience.

Please consider three constructs on this theme found in the book titled "What Makes Winning Brands Different," by Andreas Buchholz and Wolfram Wordemann.

In short, brands involve an "agenda, a drawer and a bridge." Today, we will focus on the topic of an "agenda," or a product category.

All products and services can be thought of as being part of a category or agenda that has been established by sellers and buyers. As company founders, we must either be part of the existing agenda, or we have to change it to our advantage.

Not too many years ago, we noticed advertising from Snapple, the fruit-juice company. This tiny start-up firm from New England entered the juice category against Ocean Spray, Minute Maid and other beverage behemoths. At first, Snapple performed poorly against the giant billion-dollar brands.

Unfortunately, the nascent firm was unable to secure distribution, shelving and especially mindshare. Retailers and customers saw no need for the newcomer.

Recognizing its plight as a fruit-juice company, leaders changed the essence of their brand and declared themselves a healthy-soft-drink provider.

Instead of losing ground to fruit-juice firms, they began marketing to consumers who were ready for something healthier. Even though its drinks are not 100 percent fruit juice, in the world of sugary sodas, which have zero fruit juice, Snapple products became a delicious and healthful alternative to traditional soda pop.

Viola, a new category was born and the beverage industry has never been the same.

Subway sandwiches made virtually the same move. In the gigantic world of fast-food burger chains, the agenda seems to be more about tons of bacon, more fat, more fries, all resulting in more calories.

That was the case until Subway discovered a new audience segment ready for something healthier. Despite the fact that there are now Subway sandwich stores on nearly every corner worldwide, there was a time when the category was dominated by McDonald's, Burger King and eventually Wendy's.

Subway had a hard time on that grand stage. Fast food meant burgers. That was the agenda. Subway couldn't get on the agenda, so the company changed it. Subway invented the category called "healthy fast food" and it resonated with people.

Promotional campaigns declared the use of fresh vegetables, delicious ingredients, oven-baked bread and fewer calories.

I can see, in my mind's eye, loveable Jared, who by eating Subway sandwiches lost hundreds of pounds of weight.

Not only did Subway change the agenda, but now all the other fast-food players are trying to catch up and join the innovative agenda created by Subway.

Here's another example: Years ago, the only way to enjoy a clean and fresh mouth was to brush your teeth. To improve upon this process, chemists invented Listerine. They created a new agenda, declaring that a clean mouth and sweet breath required medicine. The liquid tasted nasty, but it had to be "mediciney" in order to convince people that eliminating bad breath required the killing of germs in the mouth.

The old agenda was changed, and Johnson & Johnson sold gazillions of bottles of Listerine and became a billion-dollar brand.

When the folks at Proctor and Gamble decided to enter the mouthwash category, they knew they had to make a choice: beat the competitor with a similar product or change the agenda again.

P&G's solution was Scope. Management declared, "It kills germs but tastes good." When Scope television ads asked the question, "Why suffer with medicine breath," we all responded by buying Scope by the five-gallon barrel and thereby displaced Listerine as the top mouthwash brand.

Scope, even now, continues to dominate as a result of that decision to deliver a better-tasting mouthwash. Killing germs effectively and sweetly became the new agenda. Looking back on this event, we might think to ourselves, "How simple was that?"

It's always that simple. No matter what we are selling, we should respond to the current wishes of our customers and provide solutions they haven't even considered yet.

We should also understand the direction of our competition and then find a way to dominate the current agenda. If we can't dominate it, we should aggressively establish a new agenda that's in our favor and will be wildly embraced by consumers.

The topic next week will be creating a "drawer" in the consumer's mind. I look forward to your comments on branding. You can connect with me at www.AlanEHall.com or at @AskAlanEHall.

Alan E. Hall is a co-founding managing director of Mercato Partners, a regionally focused growth capital investment firm. He founded Grow Utah Ventures, is the founder of MarketStar Corp. and is the chairman of the Utah Technology Council.

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