Bonitamedia’s Weblog

Creating a lasting impression for small business

Branding basics in a tough economy

Branding seems to mean something different to everyone. Best definition I have found is at Wikipedia (http://en.wikipedia.org/wiki/Brand) as you might expect. No great revelation there.

What I do notice though is how often companies react to the economy, to their competition and to their own fears and abandon or stray from their brand to try something new. Now, before any “new media” consultants blast me, here me out :). The issue I am speaking about is not the delivery method, but the actual message itself.

During tough economic times, there are certain givens – almost guarantees – that will happen. How you choose to handle your business during these times invariably will determine your future success – or failure. Customers will slow down their spending habits, forcing each and every one of us to cut back – or close our doors. Interesting thing happens at this point – less businesses to serve the customer-base! Believe it or not, this is one of the greatest oppportunites you will ever have to a) increase your market share, b) increase your profits (you read correctly), c) position yourself to emerge stronger than your competition, and d) have the knowledge and forsight to handle times like these with confidence (because we will see recessions again).

How do you accomplish this? Well, I recently read an article from John A. Quelch – the Lincoln Filene Professor of Business Administration at Harvard Business School (http://hbswk.hbs.edu/item/5878.html). In this article are 8 factors he believes will help get through these trying times – definitely a must read!

Let’s take a moment to address te “reactive” strategy that seems so prevelant these days. “My competition is selling his product for 10% less than I am selling the same thing – I need to drop my price by 15% to compete…” WRONG, WRONG, WRONG! Unless your margins are so high (and if they are that high, you should reconsider your pricing structure anyway), you can’t afford to cut prices that much – nor should you. This is where the power of your brand comes in. If you are a discount retailer, you keep pushing the fact you are a discount retailer. People know that, they expect it, and will naturally think of you when your competition runs their “Lowest Prices” advertising. If you are a service-oriented store, STAY ON TRACK! Don’t get into a price war! Most price wars (at least here locally) are started because one business is closing (or saying they are closing). Ask yourself a simple question: “If I am going to purchase a product that may at some point need service or warranty work, like jewelry, should I spend my money at a place going out of business, where I will never be able to get a missing stone replaced under warranty? Or am I better off going to the store I know will always be there – and has the best service?”

The danger with getting into a pricing war is two-fold: First – you pollute and tarnish your brand. You will spend countless hours and dollars recovering from the image change. Second – you may put yourself out of business!

The bottom line is this… Be proactive in all you do. Stay consistent with your message and images. Don’t be afraid to try new media, but keep consistent. Warren Buffet summed up our current economic condition best (and I paraphrase) “When people are afraid, be greedy. When people are greedy, be afraid”. Some of the greatest opportunities are right before you. It all starts with promoting your brand and image so the consumer will have the confidence to buy from YOU when they decide to buy.

Advertisements

December 18, 2008 - Posted by | Business tips, Marketing in SWFL | , , , , , ,

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: