W&WP July 2004

 

Branding: A Unique Promise of Value

A product brand is a name or logo that has a unique promise of value associated with it. Without this promise, the product is only a commodity and highly vulnerable to competition.

By Tom Dossenbach

 

What can a company do to grab more market share? How can it compete with larger companies and against an increasing number of imported products? How can it distinguish itself from a crowded field of competitors? What more can it do to compel someone to buys its products or services?

These are all good questions that are asked by manufacturing executives every day. Of course there is not just one but many answers to each of them. This month, though, I want to focus on one strategy that I have suggested to many clients over the years - Branding!

I have long held a strong belief that branding is not only for the large company that can afford to pay celebrities for their endorsements, but also for small companies and business clusters, such as those allied by location or by trade association affiliation. Branding is a great vehicle for smaller entities to increase customer awareness in a targeted marketplace and to grow market share.

Product Perception

To illustrate how brand identification works, I would like to point to the millwork industry as an example, specifically manufacturers of windows and building products.

If you even casually look at almost any house under construction, you will notice that all the windows and doors are adorned with a large label bearing the manufacturer's name. Why do you suppose a manufacturer of windows places such large labels on its products? Surely the builder knows what products he ordered without having to be reminded in such an in-your-face way.

Have you noticed that the labels are always facing out? [Often the logo is printed on both sides of the label with cleaning and warranty information on the inside for easy viewing.] Why would the manufacturer spend 10 cents on each window to put its logo and name for passersby to see from the street?

To answer that question, let's take an imaginary drive down the street of a new development. As we enter the subdivision we notice a large number of houses under construction at various stages of development. We notice that every window of each house has a brand label on it that is large enough to be read from the street. We don't immediately recognize whose label it is, but we do remember seeing the logo in magazine advertisements.

Suddenly you point to a house where workers are installing windows that have no labels on them. Your immediate reaction is that these products must be "generic," "cheap" or in some way don't measure up with the windows in the rest of the neighborhood.

You point out another strange thing about this particular house. While all of the other houses under construction that still have the exposed insulation board showcase the manufacturer's logo, this house does not. Now you are certain this house must be built with inferior materials.

I think we can all agree that this is a highly unlikely scenario in today's new housing market. Homebuilders know that a buyer's perception of the quality of their home is strongly influenced by what they see during construction. Builders do not want to be perceived as a manufacturer of low-quality homes. To the contrary, they want to be perceived as building the best.

Thus, the product labels face out to make a statement by the window manufacturer, the insulation board manufacturer and the builder that says: "We are prominent quality players in this industry and want you to know it!" This perception is reinforced every time we see another home under construction bearing the same labels.

Commodity or Brand?

In the example above, the windows and insulation board without a label can easily be perceived as commodities. In the absence of any identifying brand, there is no association with a producer. There is no expectation of quality, only of generic functionality. Right or wrong, the perception is that the product is available anywhere for anyone and likely made by any number of manufacturers from anywhere in the world!

It is important to note that a brand is just a name or image unless it conveys a unique promise of value (POV). While still of some value, putting your name on a product alone does not state a POV. The uniqueness of your product's promise is what you need to convey to the customer. Stated another way, the promise you make tells the customer why he should buy your product rather than that of your competitors.

Thus, when we talk about "Brand," we talk about more than just a name or a logo; together they should promise the customer a unique value.

Branding Value

Anyone can design a company logo, slap it on a product and call it a "brand." However, as was just pointed out, the brand has to stand for something or it will just be a commodity with a name. It has to convey a promise of value every time someone sees it. If the brand alone is worthless, how do you build value to that brand? You start by communicating that value to the buyer. If you are effective, the brand name or logo will come to symbolize your POV.

One of the best examples I can think of is Maytag. Who doesn't know the "Lonely Repairman" sitting around in his Maytag uniform, playing cards while waiting for the phone to ring to free him of his boredom? The idea readily comes across that this guy never gets a call because of the excellent quality and reliability of Maytag appliances.

In two words, the promise of value of the Maytag brand is Quality and Reliability.

If the Maytag commercial only showed a washing machine sitting on a retail floor with music playing in the background, would this create brand value? Of course it wouldn't. It is through the portrayal of the lonely repairman that Maytag created the perception of brand value.

Every wood product manufacturer has a company name but few have a brand with a perceived promise of value. The challenge is to identify and communicate your unique POV to the buyer.

Vermont Brands an Industry

This is only the second time in the history of this column that I am mentioning a client by name. However, with permission, I think it is instructive to consider what the state of Vermont has done to successfully brand its entire secondary wood products industry.

The Vermont wood products industry is important to the economic health of the state and to its largely rural communities. I don't have the space to go into the unique reasons for why and how this program came about. Suffice it to say, the state's Office of Economic Development and other organizations recognized that the wood products sector was in decline and in need of a strategy to turn it around for long-term growth and vitality.

 

This logo represents quality Vermont value-added wood products with a unique promise of value. Quality includes durability, environmentally friendly, and much more. Go to www.vermontwood.com for details.

Three years ago our firm was commissioned to study the sector and to come up with prioritized strategies to strengthen the secondary wood products sector. A multi-faceted plan was developed, founded on the premise of creating a unique brand denoting the craftsmanship of Vermont wood products. While this was only one of the elements of the overall strategy, it was and still is a key to the success of the others.

The Vermont Wood Manufacturers Assn. served as the catalyst in the process of creating a Vermont Quality Wood Products Brand (see box.) It also was instrumental in developing a POV with the help of the Vermont Wood Products Council and numerous state government agencies. Not only have larger companies bought into this concept, but the smaller manufacturers in the Vermont Wood Net are also behind the project. As a result, it encompasses the vast majority of secondary wood products manufacturers in the state. While the POV is still being refined and the communication efforts are still in their infancy, the campaign is already having a positive impact on helping Vermont wood products manufacturers win more business.

The groups involved have agreed on the qualifications required for companies to use the brand. The state of Vermont and its agencies promoting the brand include the Department of Tourism and Marketing and the hospitality industry, according to Mary Jeanne Packer, executive director of the VWMA.

What About You?

Every manufacturer has a need to separate itself from the rest of its competition by providing an easy way for the buyer or consumer to recognize its unique promise of value. Creating a brand to communicate this and promoting it will give you an additional tool with which to compete.

It doesn't matter if your customer is Ms. Homeowner, a retailer, a manufacturer, a university or an overseas buyer, you must communicate a unique value of your products or services in order to get their business. One of the best ways to achieve this to a wide variety of customers is through the development of a good brand and its effective promotion and use.

Decide what unique promise of value you want your brand to convey and then create and market the brand in that light. No other company in the world can promise the exact same value as you if you are willing to work hard at it and use creativity in the process.

It works. Just ask Maytag or any member of the Vermont Wood Products Assn.

 

Dossenbach to Speak at Wood Finishing Seminar in Atlanta

 

Tom Dossenbach will serve as the keynote speaker at the "Wood Finishing 2004 Conference: Improving Processes & Profits."

Dossenbach's presentation, "Lean Thinking in the Finishing Room," will discuss how to identify and eliminate waste and how to work toward continuously improving operations.

The full-day program, organized by the Centre for Advanced Wood Processing at the University of British Columbia and W&WP, will be held Aug. 25, at the Marriott Marquis Hotel in Atlanta, GA. The program is sponsored in part by Kremlin Inc. by Exel Industrial Inc. Call (866) 822-2297 for registration information.

Tom Dossenbach is managing director of Dossenbach Associates LLC, a Sanford, NC-based international consulting and research firm. He can be reached at (919) 775-5017, or at his firm's Web site www.dossenbach.com.

                                                                                                                                                                                           

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