In a recent Gartner report, one-third of CMOs placed brand strategy as their most vital capability–leap-frogging to the top of marketing capabilities from its position at the bottom of the 2019 list.
Why the change?
In the minds of many CMOs, the patterns that emerged during COVID supported the notion that consumers seek value and convenience. From buyer behaviors to college application submissions, well-known or strong brands that continued to invest in brand building gained a competitive advantage in the market because they continued to make buying decisions easier.
Similarly, when applied to industries with typically longer buying cycles, investing in brand strategy through brand-building activities produce short-term efficiencies and sustainable growth.
Simply put, a strong brand is a business’s most valuable commercial asset. It increases the likelihood of customers choosing you over your competitor’s and your ability to attract more customers (often at a lower cost per sale/lead).
Below we’ve outlined three reasons why a strong brand strategy is a critical capability in uncertain times.
1 – Strong Perception of Value
Strong brands have pricing power, category optionality and stronger sales response rates.
When it comes to pricing, strong brands have the power to decrease price sensitivity–meaning they are able to raise prices and still gain customers or maintain their price while others discount.
In Market Leader, Laurie Young wrote: “Products die but brands can live forever.” While the scenario is entirely true, so too can categories. LinkedIn’s B2B Institute calls this category optionality. Strong brands are shown to stand a much better chance of surviving category shifts. Whether it’s a shrinking category, a category flush with new entrants or distribution modalities change (in the case of higher ed), the investment in brand-building enables companies and institutions to pivot and weather the storm.
Finally, market receptiveness improves as perceived value increases. As the saying goes: “If you have a weak brand, people send you straight to voicemail.” Sales activation and lead generation become much easier when a brand is well-known. This effect can be incredibly powerful if you’re expanding your market or recruitment areas.
2- Are In-Market When Most Aren’t
Strong brands remain “in-market” because they are easily remembered.
As James Hurman pointed out in Rethinking Brand, “at any point in time, there is a finite amount of demand for a brand.” When most of your audience isn’t in-market, without investing in future demand, you’re asking your media to work that much harder.
When the sales cycle is long, or the time between purchases lasts for years, or a life event keeps an education decision at bay, strong brands remain rooted in memory even when their audience isn’t in-market.
3 -Better Driver of Marketing Effectiveness
From cost-per-acquisition to click-thru-rate, strong brands drive marketing effectiveness.
The benefit of a strong brand along the purchase journey is that it can drive efficiencies at each stage of the funnel. At the top of the funnel, strong brands are mentally available. When a brand is more likely to be thought of, they command more attention in digital advertising spaces, are able to be processed with lower cognitive involvement and can withstand gaps in advertising and still achieve awareness measures.
Beyond the top of the funnel, strong brands tend to see cost-per-acquisition decrease as reach and awareness increase, they are more likely to have a higher click-through rate and more likely not to lose clicks in search results to similar brands. Whether your customers have small consideration sets or applying to 5-7 schools, the stronger your brand the more marketing efficiencies you’ll enjoy beyond getting noticed.
It’s no longer a question of whether or not brand strategy is important. It plays a vital role in the growth of your brand and the sustained success of your marketing efforts. Whether you need brand strategy help or want to discuss how to activate your brand, let us know!