At the World Economic Forum in Davos, Switzerland, several years ago, CEOs from around the world reported that the equity in their brand represented about 40% of their total market capitalization. More recently, Brand Channel stated that 70% of McDonald's shareholder value was generated by the brand alone.
It's pretty simple. A strategic, brand-building plan is critical to creating value in a company and its products and services. That's why I found it so frustrating to hear a colleague talk about a CEO they know personally who just announced that their commodity-based company was going to "drop the emphasis on this branding stuff and just focus on search."
Now, if we give this CEO the benefit of the doubt and assume they meant to say they're going to quit handing out koozies with their logo on it and start bolstering their search efforts, then it might make a little more sense. If not, here's the primary reason I say it's frustrating:
It would be like saying that customers and prospective customers will no longer be exposed to your company and its products. No website. No phone calls taken. No salespeople. No communication. No packaging. No dealers. No signage. No stated values. You get the picture. Like it or not, you're ALWAYS branding. Because branding isn't just putting a logo on an envelope. It's the complete experience a customer has as they interact with your company and your products or services. Every click on your website. Every phone conversation. Every email you send. Every advertisement. Every dealer salesperson. Those "touches" are ALWAYS branding your company and molding into some sort of perceived value - either positive or negative - in the minds of your customers and prospects.
So, there it is. Branding is important to the overall value of your company. Now, if only doing it was as easy as realizing you need to do it. Well, check out these five questions posed by brand consultant Chuck Pettis in his article written for Morgan Stanley, titled The Relationship of Corporate Brand Strategy and Stock Price for companies wanting to rate their "brand strategy IQ." They just might help get the wheels turning...