Have you been considering a rebrand but are hesitant to pull the trigger because of the cost involved? This article illustrates how rebranding your small business will help it grow.
As fellow entrepreneurs, we understand what it’s like to build a business from the ground up. Bootstrapping when you open the doors, there’s often little room for a large investment in branding strategy. But as your business grows and you spend time analyzing what’s working and what isn’t, conversion rates reveal that something isn’t quite right. You start to consider a rebrand, and might start to think about what return on investment rebranding your small business might offer.
If you own or run a small to medium-sized business, a rebrand could be a big decision, with risks and rewards in equal measure. But if done right, and for the right reasons, rebranding can offer your business benefits that will more than justify the investment you make. Let’s look at five areas where rebranding offers a significant ROI.
A strong brand reduces customer acquisition costs
In a competitive market, capturing market share is hard work. Your marketing campaigns have to do a lot of work to get your audience’s attention. Building a strong brand takes some of the load of your campaigns, by creating brand advocates.
And studies show that peer-to-peer recommendations are behind 20 to 50% of all purchasing decisions. When a friend or family advocates for a brand, the likelihood of purchase increases by a staggering 50x!
Strong brands that focus on building a ‘presence’ can expect a significant increase in inbound marketing activity. This simply means that a robust rebrand exercise will pay for itself many times over with a reduced cost of customer acquisition.
Customers (and employees) are loyal to a strong brand experience.
Owning mind-space and building recall value is critical when it comes to customer retention. A well-defined brand that is developed on understanding its audience thoroughly, creates a brand experience that is unique, consistent and makes customers lifelong loyalists.
Companies that take advantage of a well-executed rebrand to create a ‘brand cult’ will ultimately deliver more revenues and profit, and can count on consistently increased sales by engaging and retaining customers for a lifetime.
A strong brand is the most valuable asset for your business, that helps you build and retain your next-most valuable asset – employees. Attracting top talent, motivating them to give their best, and staying with your business is where a strong brand will offer unmatched ROI.
Rebranding your small business to reach the right audience helps.
Is your brand speaking to an audience that doesn’t ‘fit’? Can you calculate the value of time, finances and effort spent on engaging audiences that are not potential customers for your business?
If you understand your customer well, rebranding to a more specifically targeted, leaner brand will make a big impact on your business costs for acquiring and servicing customers.
Choose a rebrand over marketing initiatives for long-term growth
A study of marketing effectiveness in the digital era by The Institute of Practitioners in Advertising (IPA) shows that brand-building activity drives significantly stronger sales growth than the temporary uplifts caused by short-term marketing initiatives.
In the short term, marketing initiatives might produce higher spikes in sales. These however drop off quickly, not lasting too long after the end of the campaign.
Investing in brand-building activities including rebranding, however, will have a longer-lasting effect, as it builds up over time, and increasing levels of brand awareness and loyalty take much longer to fade away.
Never underestimate the pricing power of a premium brand
For all the ease of finding alternatives and a market where people are bent on bargain-hunting and getting the best deal for themselves, the hard truth is that people still pay more for stronger brands. In fact, a majority of people rank the importance of finding the best brand much higher than getting the cheapest price.
Warren Buffett himself said the single most important decision in evaluating a business is pricing power. If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business.
And there’s no doubt that pricing power is derived from strong brands. Looking for an ROI on your rebrand? Pricing power is one of the most obvious, and probably the most valuable.
A strong brand is a somewhat intangible return on investment that rebranding your business offers. But consider the tangible benefits of a strong brand – more customers, at lower acquisition costs, who recommend your brand to their friends and family, and will pay more for your offerings, and do business with you more frequently, a little more often over their lifetime.
Still unsure what ROI you can expect if you rebrand your small business?
Our brand experts at Mystique will be happy to talk you through what rebranding could do for your business, with a quick, no-obligation 15-minute discovery call.
Click here to book time with us.