Success Authority Peter Beaumont gives real-world examples of effective branding’s influence on business growth, sustainability, and competitive immunity. He also discusses the crucial elements of effective branding.
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Linda Ruhland
Does a brand have any influence over a company’s ability to remain immune against its competition?
Peter Beaumont
Yes. A brand does have such an influence. But I would tend to say that it depends on whether it’s a short- or long-term influence. One of the things we have found when talking about a brand’s influence is that it’s often competitive advantage vs. immunity—immunity being something much more long-term. It’s something we’ll talk more about a bit later. It’s more strategic rather than tactical. We have to be careful when we talk about a brand influence as to whether we’re looking at it from the long term or the short-term basis.
To answer your question, the short answer is probably, “Yes, it does have an influence over a company’s immunity.” But it needs to do a lot more than just have an edge around, for example, features and benefits, which is much more a competitive advantage rather than something that’s long term, which will keep the motors warm and can sit around you to secure your profits.
Ruhland
You’re saying that a brand typically focuses on the benefits, let’s say motivation behind purchasing behavior and therefore usually has more of a competitive advantage rather than an ability to be strongly immune against competition.
Beaumont
That’s a good summary, yeah.
Ruhland
Is a brand important, more or less, during times of rapid change, like we’re going through right now?
Beaumont
Rapidly changing times can be falling into so many things with the recent situation, visa vi Russia and the Ukraine and what impact that may have on supply chain, or a worse situation than COVID’s caused. We’ve got COVID, of course. And then we’ve got the digital age, which is changing the way that people shop and research and buy their products.
I think in many ways we’ve commoditized the way that we buy things. Amazon, being a prime example. There are a lot of brands on Amazon, but they are much more promoted now by either Amazon’s latest offer in which there’s obviously more profit. So, they will push that brand out at you digitally. You’ll be able to shop at grocery stores online and pick it up rather than going into the store. Good brands stand out and people remember those brands rather than private label or something that Amazon’s pushing because it makes more profit.
If the brand’s built itself to be that much better, more special, and different to the consumer, and, by the way, I’d extend that out to services, too, then you stand a much better chance of being purchased than you would if you’d not built yourself up properly. So, yeah, I believe it is a factor. We all read about bricks and mortar going away. It’s not going away, it’s just the ones that haven’t done a very good job that are going away. Bricks and mortar will still be around. People still like that experience. People still like reading paperbacks, or hardbacks. Not everybody switched to reading Kindle or digitally. There’s a reason for that. There’s still a place for it.
Brands that have done a good job will need to continue doing a really good job because they’ve got even more competition because the channels of purchase and distribution have changed dramatically.
Ruhland
Sometimes I hear business people talk about not wanting to advertise in print anymore. They bought into the idea that “print is dead.” And other times I hear that same story about websites, that websites have gone by the wayside because Facebook and other social media replace that kind of presence. What’s your opinion on that? Is search engine marketing, again the ability for something larger in terms of an online shopping app or a search engine a replacement for what they were doing independently?
Beaumont
There’s a bigger range of media open to us to reach our target markets than their used to be. But, as with everything in life, it’s all about balance. So, in my view, depending on the product, some people are not developing their websites whereas, in fact, it’s probably the strongest vehicle, if you look at it. What they should perhaps be doing is driving the traffic through social media back to their website because, guess what, they control their own website. They control the content. They can control the call to action. So, if they’re doing a good job, I would encourage and, again, it depends on what you are selling. With a service, where it’s a lot more difficult to get across what you’re doing, rather than just a product image. You know, “refreshing drink,” I mean, that’s pretty straightforward. But if you’re trying to offer wealth management via a smiley face and “I can bring you money,” probably doesn’t work so effectively. You have to spend a bit more time and real estate on demonstrating how you can help. The way to do that is to encourage people through lead magnets or content that they can only get from your website and drive traffic to your website.
I would argue that it really depends on what you’re selling and where you’re positioning and what your target market is. Social media can be like throwing mud at the wall and hoping that some of it will stick. Social media is now starting to develop into niche markets in which, for example, with Pinterest, LinkedIn, Instagram, you can be a lot more specific now about some of those.
I’m working with a client, now, who’s trying to reach designers. We’ve found out that designers, for some reason or another, use Instagram. We’re now doing a lot more posting and content on Instagram. But guess what, to drive them back to our website!
Ruhland
You mentioned the difference between competitive advantage and Competitive Immunity that’s creating products you can sell versus creating products and services people want to buy. Can you elaborate on this and the key difference between them?
Beaumont
The simplest way to explain that is, like presenting yourself, which we call elevator pitches, we tend to tell people what we can do or what we are good at. We tend to do the same thing with products. What we need to think about with any brand, whether that’s yourself as a brand or product or service, is what do people need? What is the satisfaction of the need? And those tend to be what I mentioned earlier, which is features and benefits. The real trick in positioning and getting people to really want your product is, “What’s the want? What’s the icing on the cake?” What is it they really want on top of their needs? A need is very functional. A want is to make them go a bit further. It’s a bit like saying, “What problem am I solving?”
Simon Sinek, well known by many, started the Golden Circle back in 2017. He started talking about the Golden Circle and the why. He used to explain that the middle of the circle is the why and it ripples out into how and then what. He used the example that most people start from “this is what they do,” and “how is how they do it,” and then very few people talk about “why.” He uses the Apple example where he talks about if you started from the outside of the circle working in, you would say, “Hey, I’m Apple. We make great computers. They’re beautifully designed and easy to use. Want to buy one?” Now, that’s reasonably powerful, but not nearly as powerful as starting with the why, which is the purpose, cause or passion, which would be, “We at Apple think differently. We think differently about everything. As a result, we design beautiful things and, by the way, we make great computers. Do you want to buy one?” It reverses the way that everybody thinks and talks about things.
As a result of that, we’ve got Don Miller who came along and talked about the brand story. He’s reversed it, too, and said, “What’s the problem that you’re solving? What is the solution to that? And then, what are the benefits?” To answer your question, Competitive Immunity does that. Competitive advantage simply talks about functional needs. I’ll give you an example. Safety would be one where customers are concerned with safety. You could come up with a product which would be a home alarm system. You could discuss all the bells and whistles of the product. “It’s the greatest piece of tech, and it will do all sorts of things you want it to.” But it’s missing a vital piece, which is, “What is it doing to help?” It’s protecting your valuables. It’s protecting the safety of your family. And that’s the kind of need plus the want. And that’s the problem that you’re really solving. You should lead with the safety of the family and the safety of your valuables, safekeeping, and then talk about benefits and features.
Ruhland
I notice one thing immediately when you started with the why—Sinek’s why—and then followed up and beyond in his Golden Circle analogy is that as soon as you start talking about “why” it makes it easier for me to visualize my own why. And I’m starting to relate. By the time you get to the what and how, I’ve already bonded with you over the why. It’s very interesting and happens very quickly.
Beaumont
That’s good. That just goes to prove it does work. Because it’s like telling a story, isn’t it?
Ruhland
Yeah, you start to imagine, visualize, or put another character in the place of whomever that individual is describing. It’s very human.
Beaumont
Absolutely
Ruhland
We tend to ignore the human factor in communications.
Beaumont
We do! And yet it’s people who are buying and selling. People are the common denominator throughout the whole chain.
Ruhland
So, is it true that brands no longer have time to grow? You’ve mentioned that before and it’s somewhat alarming and disappointing when I hear about that. Is it true for small businesses and publicly traded businesses, alike?
Beaumont
Let me answer that question and give the rationale as to why I think that is an issue. Then we’ll come to the small versus large point. I don’t want to get ahead of it, but I think it’s more a problem with larger companies. Therefore, it becomes a problem for small companies that get large. For large companies, it’s become a huge issue because the stock market has changed the way that companies are able to build brands. The reason why I’ve been saying this for quite a while now is because of my experience with Coca-Cola. We were going to make some major changes to innovation. It was thought by the Board to be retrograde and would wipe value off the stock market. I’ll give you an example.
Many, many years ago, before Pepsi bought Gatorade, Gatorade was around, and it was flourishing. The Coca Cola company was going to buy Gatorade, and they did not do so because they were worried about what effect that might have because it was several multiples above what it should be technically, but they were buying it for long term, understanding that sports drinks were going to be a great segment. They did not buy it, and Pepsi ended up buying it. And then Coca-Cola realized how big that sector was. They had to invest and bring their own brand called Powerade. It cost them a fortune—much, much more than the purchase of Gatorade.
The reason I used that example is because that decision was forced by the potential fallout of the stock market. The stock market has a huge influence over the strategic planning of companies with really good brands. The way that short-term thinking has entered our lives, to quote Simon Sinek in “The Infinite Game versus the Finite Game,” the finite game is about winning and losing, the infinite game is about just playing in the game as long as you can. If you can do that and build a brand, then you’ll be successful. But so many companies…Richard Branson’s taken most of his 60 companies at some time or another off the public stock market and privatized them, again, because he didn’t want to be told what to do about building his brand, Virgin being one of them. Many companies have taken themselves off the stock market only to return, again, after being able to spend the time building the brand the way they wanted to. Companies like Dell and Panera Bread and Hilton Worldwide, Heinz, and Burger King, all those brands have been taken off the market and possibly brought back when they could be able to be in control of their own destiny. So, to answer your question, I think it’s true, and there are other factors that play into it. It’s not only short-term thinking, but I think that’s got a lot to do with it. Now, does it affect small businesses versus large businesses? Or does it affect small businesses as much as large businesses? Not so much because the small business has got much more control and the small business is not on the stock market, so they have much more control over their own destiny. Of course, I think the big factor is when they go public.
Ruhland
What are the crucial elements of effective branding?
Beaumont
Brand positioning is paramount. What I mean by that is there are five critical elements to effective branding. Probably the first one is brand positioning. That’s because many people come up with a brand, but they don’t take the time to think about the value proposition is, which is another way of putting what brand positioning is. So, what does it stand for? And what are we going to focus on? Whatever that brand positioning is, and you’ve agreed upon, you have to run it through a filter. So, if you’re going to start doing line extensions on it, does it fit with that brand positioning?
I’ll use Coca-Cola as an example. I used to work for them and that’s why I use them often. Their brand positioning was, “Providing delicious refreshment.” Now, if you start coming out with a chocolate-flavored Coke, that probably wouldn’t fit with that definition. Cherry would be okay, or vanilla would be okay, but you can’t start deviating off into different types of products.
Secondly, we’ve got brand promise. What are you promising to solve for people and keeping to that on a regular basis?
And then what’s the brand personality? Is it fun? Is it serious? Is it something that is lifesaving? Is it something that just makes your day go better? Generate that personality around it. And, again, whether it’s a service or a product.
Then, what’s the brand story? Where did you come from and where are you going? So that people can associate with it.
And the last piece, I think, is brand association. Let’s say, Nike, where we come to associate top stars with Nike: Tiger Woods and Nike, and whoever you might think. But there’s a brand association: the Swish and the star go together—brand association.
Those would be the five critical elements I would choose to make sure that we’ve got effective branding.
Ruhland
Does Branding have any influence over attracting employees and recruiting and retaining them?
Beaumont
In a market where we are having problems employing people, those companies [with effective brands] don’t have any problems because they are brands that people want to be associated with. They want to boast that they work for them. People used to ask me, “Hey, what’s it like working for Coca-Cola?” I used to be, for five minutes, the star of the dinner party because as soon as you said you worked for Coca Cola it was like you were a film star for a short time. If you’ve ever been to drinks or dinner or around people who said they worked for Google, or they work at Apple. There’s an immediate attraction. They’ve all got a story about it, right? “Do they really put sugar in Coke? Is Mexican Coke better than the one we drink?” People have got a hundred stories about that. “Is the Mac, the new M1 performance better than the previous operating system? Did Google really change those blue colors to do the search, you know?” I mean, everybody’s got questions around those things. I can’t think of many, but if somebody told me they worked for Amazon, the only question I’d have is, “Are those warehouses really that big?” I mean, that’s not the most attractive thing to work for Amazon, frankly.
It’s a long way of answering your question, but I think brands have a huge amount of influence on attracting and, indeed, retention. Because if you feel proud to work for a company, if you go out and people ask you about the company you work for, how proud do you feel that: A) You’ve got the job; B) You kept it, and people are attracted by that.
Ruhland
Related to that, is it possible to communicate your leadership through branding? And, if so, how would you explain doing that?
Beaumont
I think it is. Some of the companies I’ve just mentioned have done that. What they’ve done is taken a focus or position, go back to Simon Sinek’s example. They’ve used the why to take the high ground about what they do. And doing it differently than anybody else. In EOS Traction they talk about the three uniques. Which are, “What are the three uniques you have in your company that make you stand out?” Now, one may be very similar to your competition, two may be a little bit more special, but the third one should really be unique. Something you do that nobody else does. What happens with branding is if you’re not careful, those uniques get eroded. So, you’ve got to constantly make sure that you’ve got at least one of those uniques that are unique.
Let’s say, Uber would be one where they were unique for some time, and then other companies started to step in. So, they started changing their positioning to a better app where you could see the driver coming, the number plate, and everything else. They stayed well ahead of the pack being very unique. Then they’d gone one step ahead. People started following that, too. So now, they’re delivering food. And now, they’ve gone even further delivering nonfood. So, one of those three uniques keeps changing to keep ahead of the market.
Yes, the three uniques, is a way of communicating leadership in the market.
Ruhland
Again, what effects do search engines, like Google, have on brands. You mentioned something about commodities. Does Google care about brands and, if so, how do we leverage that? Or is it a risk that we have to be wary of?
Beaumont
First of all, when you get into search engine optimization and all the algorithms, you start to get into commoditization, but good brands make sure that they stay ahead of that game. Really, they are building more awareness of their brand by using the algorithms. But it’s a high risk to rely on that. Staying ahead of the game on search engine optimization is really tough. That’s why SEO suddenly started moving into ads on pages because that wasn’t enough anymore. The jury is still out on how effective some of these ads are. The popups and the ads…if you go onto Forbes online magazine, now, I can’t even concentrate on the copy anymore. There’s just so much stuff going on. In fact, I avoid going on Forbes now. I think it’s been bad for their brand, to be honest, because it’s too busy. I get that you want to advertise and still make the copy free, but there has to be a limit. And I think they crossed that one.
To answer your question, I think it depends on the brand, it depends on what you are looking to do. It’s a bit like, “What’s your target market, and how is it best to reach them?”
Ruhland
What is the most important thing a company can do to establish its brand leadership?
Beaumont
The best way I can describe it is making sure that those five crucial elements we talked about are done really effectively. To me, that is the A to Zed of good branding: Getting your brand positioning right all the way through to brand association. I would say there are two things that underpin those: once you’ve got those and you’ve got your filter for what your brand is all about, is focusing—absolutely relentless focus on those five crucial elements, don’t let anything distract you—and then ensure that you’re communicating tirelessly all the time along those five elements. It’s a process and I think sometimes there’s a trap with agencies, marketing people to chase the latest silver object and go down that path because that seems more interesting. Particularly, that’s their creativity coming out. But, unfortunately, what you need is the initial input from creative agencies so that you get that brand positioning. And then, they need to get out of the way and let the process guys follow. Reinforce, reinforce, reinforce because, as we all know, and I found out that the people who put the commercials together would get tired of them years before the consumers actually cycled through most of them. Simply because we saw them day in and day out, we forget that not everybody else has seen them day in and day out. This is why we keep seeing the same LinkedIn post very often, because people realize that you may have seen it three or four times, but somebody else is seeing it for the first time. So, it’s a relentless process, follow-up, keeping on track, of those five elements.