There are tens of millions of small businesses and corporations in the United States today. A deluge of brands, all with their own marketing campaigns, makes it more overwhelming than ever for potential customers to choose the right products or services for their needs. No matter how many advertisements or social media posts your target customers see, their willingness to select your company depends on how well they conceptualize, understand, and trust your brand, its offerings, and employees.
It probably seems obvious that your organization’s image and perception is critical. Too often, however, companies fail to understand the distinct impact that weak brand perception can have on their bottom line. As a result, they may under-invest in developing and managing their brand, even as the consumer decision journey has changed so profoundly.
Having strong market awareness and a positive image is vital, but it’s equally important for the market to have an accurate view of your company and the unique way it can deliver value. It’s not unusual for a company to be battling an image that is inaccurate for whatever reason. For example,
- The company has expanded its offerings over time or entered new markets. Customers aren’t aware that the company has evolved or are doubtful of their new capabilities.
- The company has shifted its business model. Perhaps it’s gone from a product company to a services company, or from a physical to a digital model.
- The company may have had some financial or reputational challenges in the past that have now been addressed. Every company has growth pains and challenges in the market, sometimes these can stick in the minds of customers for a long time.
- The company just hasn’t done a good job of telling the market who they are and where they excel. This is not uncommon since investing in brand promotion and marketing is often the last thing in a small to medium-sized business.
These scenarios can be extremely frustrating for the company CEO who knows the truth. The CEO may say “if only our target market knew what our best customers already know,” or “our competition is telling stories about us based on who the company was 10 years ago.”
So, what is the exact impact of customers and prospects having the right view of your company? Simply put, a positive brand perception means customers are more likely to choose your business over a competitor. Another study by McKinsey found that B2B companies with brands that are perceived as strong generate a higher EBITDA margin than others.
This direct impact on growth and profitability should be reason enough for CEOs to worry about how customers perceive their company’s brand. By improving brand perception, you can:
- Increase revenue through higher win rates. When customers clearly understand what your company does and how it’s different, the odds of winning profitable business increase dramatically. If you can improve your win rate by just 10-20%, what would that mean to your top line?
- Achieve higher profitability by providing a defense against discounting. When your company or product lacks differentiation or has some negative connotation then you tend to compete on price. If you can increase average deal margin by 10% or more, what would that mean to your bottom line?
- Lower sales costs by improving the productivity of your sales force. When sales people lack a differentiated message for specific target markets, they can spend a lot of time chasing the wrong opportunities. If each of your sales people could improve their sales contribution by just 10% each, what would that mean to your bottom line?
- Attract and retain strong talent. For most businesses, people are the biggest asset – and those people want to work for companies that are viewed positively in the market. If you can improve your employee retention rate by a couple of points, what would that mean to your bottom line?
- Increase the return on marketing spend by being more efficient, focused and unified. Having a clear and differentiated brand positioning makes all your marketing efforts more productive and purposeful. If you could increase lead generation by just 10-20% how would that translate into increased sales for your company?
So what steps can you take to improve how the market perceives your company? You don’t need deep pockets to make big changes to your brand, but you do need to take an insight-driven and structured approach to solving the problem. To begin, you’ll need to focus on your business’s position in the market to accelerate your growth and profitability. There are five key focus areas for improving brand perception to drive higher growth:
- Get your positioning right.
- Recruit your employees to be brand ambassadors.
- Get others to tell the story for you.
- Be pervasive, consistent, and persistent in your approach.
- Measure your progress and adjust.
By carefully examining the above elements, you will begin to define why you matter to customers, so you can secure a position of differentiation in your marketplace.