Posted by Alan Nazarelli ● Sun, Feb 04, 2024 @ 12:43 PM
Strategies for strengthening brand performance in 2024
As we enter February, I thought it would be a good time to issue a primer on strengthening brand performance as our post this week.
One interesting observation I had when I reviewed the transcripts from executive interviews that we conducted with CMOs late last year for our report "Shift Happens-The Changing Business Landscape in 2024" (link below in case you missed my invitation last month to download a complimentary copy), is the heightened focus on numerical and technology-related objectives in 2024. CMOs were most likely to articulate goals relating to increasing MQLs, marketing qualified leads, or technology related ones like improving marketing operations or getting better returns from their marketing technology investments in 2024.
Missing in action in these conversations were qualitative aspects such as better creative strategies, improving brand performance, brand positioning and other attributes associated with the brand. Are these not important in 2024? Or are these table stakes now? Do CMOs and marketing leaders feel they can check off the box on this one?
As a brand researcher for many years, this had me curious. True, the marketing function has tilted significantly more towards technology deployment in recent years, i.e., more left brained and analytical. This is due to the proliferation and increased sophistication of MarTech (marketing technology) tools and the rise of the Marketing Operations function and culture in the past few years. Yet, I did find interesting how much of our discussions with CMOs centered around these functions and how little around creative aspects. The questions we designed were broad and simply asked about their objectives for the coming year and so the interview respondents were not steered in any way to talking about these aspects, but these were the topics that were top-of-mind.
It's appropriate to ask what impact this could have on brand performance. Or more constructively, how can marketing teams refocus their efforts on brand quality and performance? According to the International Valuation Standards Council, an average of 18% of quoted enterprise value is attributed to brand. This is a significant portion of valuation to leave on the table. For high growth tech companies seeking to raise equity this year, are you fine with undervaluing your company by 18%?
Here are some actions we use in our client work for you to consider for strengthening and quantifying your brand value by the end of 2024:
- Brand Measurement: Not to sound too cliched here, but what gets measured gets improved. We are surprised at the number of companies we encounter who are highly measurement driven, but do not measure their brand. Brand measurement gets ignored because it's an intangible metric compared to so many other KPIs that are being tracked today. Moreover, to be a valid metric, the brand value must be measured in the marketplace and not just with existing customers, which often requires external help from third parties, who can generate also generate data about brand standing among competitive product adopters.
- A Focus on Equity, not just Awareness: Too often, companies focus on measuring brand awareness-what percent of people are aware of the brand? And comparing that with awareness of nearest top competitor brands. While useful in and of itself, to be able to make a case for valuation, brand equity measurement is required. The formula here is Brand Equity=Brand Awareness X Brand Stickiness where: Brand Stickiness is the length to which decision makers will go to resist pressure to switch brands, either due to corporate edicts from above, vendor consolidation and/or enticing offers from competitors to switch suppliers.
- Brand Usage Affinity: Corporate users of your product(s) have significant sway with top decision makers when it comes to renewing contracts or resisting compelling competitive offers. To this end, measuring product utility and its impact on your brand power becomes another arrow in your quiver for asserting the value of your brand. This is typically measured by deconstructing all the features and benefits of the products(s), having them stacked ranked by importance or utility by end users, then having those end users rank how well your products perform on those attributes. In this manner, we can construct brand power maps for your product(s) against top competitors
- (Bonus insight)-Enterprise Worthiness: Many sellers have used land-and-expand strategies to acquire large multi-division and global accounts. Remote workgroups have often proven to be easier to pitch and sell to than central corporate entities and procurement groups. Such "rogue" or "shadow" installations (in the eyes of Central IT) are then propagated laterally to other workgroups and eventually floated for consideration upstream, at which point, various tests of enterprise worthiness of the platform are applied. For this reason, it is also important for large enterprise sellers to include enterprise worthiness perceptions and how these have progressed over time as the company garnered more company wide implementations in their brand story. The picture above this post is a graphic from one of our studies for a business process automation platform (brand names redacted).
Here is a link to our recent report on which this post is based:
"Shift Happens-The Changing Business Landscape in 2024"
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Alan Nazarelli is Founder & CEO of Silicon Valley Research Group. Based in San Jose, CA with offices in Seattle and New York, the company works with the world’s most innovative brands to provide timely and actionable market intelligence and strategic guidance to enable them to make well-informed decisions to positively impact revenues and profits and to achieve their growth targets. Connect with Al on Linked in
Topics: Market Research Best Practice