Can a solid value proposition kill the need for advertising?
5 min read
Words by Jen Barry
Brand equity is equally as important for marketing function as it is for business strategy and direction.
What is brand equity?
In the short-term it can help drive sales and promotions, and in the long-term be relied upon to support a business, garnering loyalty with consumers to ride out PR storms (Facebook, Uber, Amazon have all had their fair share in recent times), and even survive a global pandemic as we are seeing today.
In a time of crisis, brand equity is more important than ever. Of course most crucially, there is the bottom line; when you have strong brand equity, consumers will be more likely to buy from you, and in today’s climate whether that means stockpiling or buying vouchers to redeem services and/or products in the future, there will still be a healthy demand. However, it is also a discreet way to keep eyeballs on the brand even in the absence of marketing and advertising budgets. When the headlines are dominated by news of a crisis, it may be seen as opportunistic or in some cases crass to push a brand to consumers, referrals from customers to reach a new audience is key to aid in market retention.
There has also been a progression or evolution of loyalty with brand empathy; typically an emotion held between people, not usually between consumers and brands. Today, with brands becoming more ‘human’ in how they communicate with consumers, using open and honest dialogue, they are now benefiting from their empathy. From people giving donations to their favourite bars and restaurants, to not wanting cash refunds for cancelled events and festivals, people are rallying behind brands and supporting them more than ever. There is a ‘Dunkirk’ spirit across the world as everyone is experiencing a humbling effect of the virus taking control out of their hands.
The need for a solid foundation
But whilst we might not have control over how the virus and pandemic will play out, we can control our brand foundation and assets to make sure they are structurally sound to weather the storm. As an agency, our philosophy has always been to design with purpose and intention in order to build brands that last and businesses that thrive, and this requires both substance and style. Whilst more modern and globally thinking brands respect the importance of brand equity it is in the past 5 months that the value has been magnified and brought to centre-stage.
As a market, a lot of Hong Kong brands have been focussed on short-term wins or superficial and aesthetic brand properties such as a logo or wordmark rather than brand foundation and proposition, and for many years this was sufficient.
Whilst aesthetics are important for a brand, and arguably being visually recognisable and distinguishable is a brand attribute as it is how consumers will literally see you, it is in vain without a foundation to shape how they feel about you. With both, and in the absence of and above the line promotions, brands can still be in the hearts and minds of customers, and can still shape how people think and feel about your products.
As an agency, our philosophy has always been to design with purpose and intention in order to build brands that last and businesses that thrive, and this requires both substance and style.
Currently, the usual pay-for-play growth is not as reliable, so particularly for direct to consumer brands planning for the longer term and healthy growth, we can expect to see diminished reliance on paid marketing with a focus on more creative, inventive business models, and robust value propositions. Whilst the world is stuck in neutral is the opportune time to hunker down and rethink brand propositions if these are not already clear for consumers, and even if historically they were, there is still opportunity to reframe and refine to ensure that you are truly relevant to the changing world and consumer.
Right now, the two most crucial questions to ask of your brand are; What are you doing different from anybody else? and Do you inspire customers with your product or service? If these can be confidently answered, then brands can expect long-term and deeper customer relationships who become the drivers and sales force. Effectively answering these questions can reduce marketing and sales costs by 80% by the power and consistency of word of mouth.