What is the ROI of Branding, as originally published Forbes.
The Covid-19 pandemic has rapidly accelerated many top businesses’ marketing efforts, but do these businesses have the proper branding to make the most of this acceleration and truly see a return on their investment (ROI)?
Attaining high branding ROI requires understanding what it is. As marketers, we all know what good branding is and its intangible benefits, but many do not know the ROI of branding. While it is easy to see how brand awareness and great branding translates into sales, genuinely understanding that brand awareness has a return on investment is key.
The ROI Of Branding Explained
Strong branding attracts customers who may be willing to pay more and buy more often at a lower cost per acquisition. Brand purpose often boosts brand awareness and ROI, while providing a boost for other marketing and brand efforts. Brand purpose can lead to powerful business results and powerful brand association. Brand awareness brings you and your audience together in a powerful way — through the packaging and essence of the brand, the brand experience that people remember, and the stories customers and potential customers tell about your product or service.
The ROI of branding — whether created during website visits, business meetings, company representatives’ communication, logos, taglines, messaging, customer services, and other brand touchpoints — can help businesses in significant, tangible ways. Strong brand ROI can result in word-of-mouth recommendations, increased awareness and reach, increased traffic and sales conversions, improved reputations, and the gaining of brand advocates and business growth.
With an enhanced conversion rate, cost per acquisition is lowered, helping businesses grow more rapidly and experience more profit. Essentially, a strong ROI from branding offers a way to create higher price points and a pricing premium, generating higher profitability. With good branding and an engaging brand story, the return on investment may result in individuals who are willing to pay extra for a product or service due to its perceived value.
Does Your Branding ROI Measure Up?
At Clearbridge Branding Agency, we have assisted in many new brand strategies and rebranding efforts for both startup companies and long-existing businesses that need to adjust their marketing methodology for current times. When we are approached by a company in need of a brand or rebranding, before we put the proverbial pen to paper, we work as a team to make decisions on realistic and attainable goals, key performance indicators (KPIs), and proven strategies that move beyond creating a logo, tagline or new website. This is the first step in ensuring branding ROI success.
To ensure your branding ROI measures up and is benefiting your business, brand health metrics can be used to measure the ROI of your branding. To measure the effectiveness of your branding efforts, you can survey market prospects, perform an online search volume, assess brand preferences and target audience purchase considerations, measure customer acquisition rates, assess incremental value through customer lifetime value (CLV) calculations, determine Net Promoter Scores and measure repeat business and customer retention rates. Should your ROI of branding not measure up, it is time to rebrand and form a new strategy.