Brand Basics for Start-ups – 2 basic steps to grow a meaningful brand

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In my first article on brand management basics, I was talking about the importance of brand building right at the start of your venture. Not only is this the best time for establishing your brand, but it directly influences your customers’ willingness to pay. But how do you start?

Step 1: Offer a meaningful difference!

The meaning your brand offers to the market will pass unnoticed if it does not establish a clear distinction compared to your competitors’ brands. This sounds simple, but many brands fail to achieve it: If you like déja-vus, I recommend you to read the ‘brand’- or ‘about us’-categories on company web pages. You’ll read terms like ‘innovation’, ‘sustainability’, ‘quality focus’, ‘customer orientation’ again and again…

No doubt: Some of these may be necessary for the credibility of a company. E.g. a car manufacturer has to signal a minimum of technological competence although competitors do the same. But that won’t make any difference that counts!

Further important restrains have to be considered by deciding what meaning should give the brand its strength: The meaning should be relevant and credible for customers. It should not be contradictory to your product offer and it should be closely connected or compatible to your company’s strategy.

Let’s take a look at an example: Gowalla and Foursquare. Both started in 2008 with an almost identical product idea (a GPS-based social media app). Gowalla had a very meaningful idea to point out a difference: “See the world through the eyes of your friends”. Gowalla’s checklist proofed perfect:

  • Its meaning was (at that time) new and differentiating.
  • It was in line with both, general and market specific requirements.
  • The meaning seemed to be relevant to customers.
  • The meaning was well deduced from the product.
  • The meaning was compatible to the company’s strategy.

But in 2011 Gowalla had to resign. Why? Thanks to an honest and very detailed post-mortem analysis of Gowalla’s founder, Josh Williams, we know that the company fell victim to an unintended violation of strategic brand implementation: Foursquare followed its rather simple strategy “to gain as many users as possible”. Gowalla’s meaningful strategy originally focused on a certain way of optimizing social interaction, resulting in a premium strategy “get the best users” (e.g. in terms of usage intensity). But unfortunately Gowalla lost track and started playing by the quantitative Foursquare-rules it obviously was not prepared for. Imperceptible their strategic focus switched from optimizing social interaction to a mere race for higher head counts. According to Josh Williams, Gowalla started losing the game exactly because of that.

Take-away: Develop your brand always in relation to market demand and take seriously the meaning structures embedded in your company’s strategy.  

Step 2: Listen, co-create & feed-forward!

If the Internet has taught us one thing about brands then this: brand strategy is no fire-and-forget-weapon (actually it never was). When you’re looking for information on a brand you’ll quickly wonder about huge differences between descriptions written by the respective company and comments in tweets, social media platforms, forums, blogs etc. (e.g. trust is no topic in relation to Deutsche Bank, but in fact: distrust is a huge one!).

This means that the basic assumption of traditional approaches as you find them in most brand strategy guidebooks “My message will be understood in the intended way.” is false. In fact, customers, media, shareholders etc. modify meanings or add new aspects while talking about your brand. This means: Your brand will get a momentum as soon as it hits the market. That’s why you’ll never again have so much influence on your brand as in the beginning of your business.

Since a brand is dynamic, your strategy has to be adaptive. The best way to get there is starting with the right mindset: Brands are not made by management. They are a continuous co-creation of company and stakeholders. This implies 2 basic tasks for successful brand management:

  1. You have to be sensitive to what people say about your brand and take it serious. Take them as partners of your management! Use open monitoring systems that not only rely on fixed KPIs but are also capable of detecting changes in the meaning of your brand. E.g. it’s nice to know how many likes and visitors you have on facebook. But this information is useless without insights of what they think of your brand and why they buy your product.
  2. Use this information for feed forward based brand management! Feed forward means that you should not only collect information but continuously use it to plan your following actions. This avoids a drift apart of your and your customers’ understanding of the brand and secures a way of proper communication. It also unfolds huge potential for your business. E.g. consumers developed Adidas as a fashion brand in the late 1970s on their own. Due to a traditional brand management approach without a feed forward mindset it took almost 10 years until Adidas recognized substantial changes in brand meaning! I do not have to mention that nowadays it’s necessary to react quicker on whatever happens in the market.

Startups have the chance to begin with this way of interactive brand management, which pays off as a competitive advantage: Many established companies start to realize that they need to change their approaches to stay competitive. However, once a static system is established, it is a very complex, time-consuming and costly process, because it takes the company more than a new tool. It needs a change of organizational structures and internal mindset. If you can avoid these investments – why not?

Still skeptical? Consider the following: Was it by chance that the best performing startup-brands of the last decades (esp. Google & Facebook) have feed-forward-based business models?

Further Media:

„Just for kicks“

Part 1: https://www.youtube.com/watch?v=EPq9IAAEZ6U

Part 2: https://www.youtube.com/watch?v=_SY5GSPNn4E

Dr. Stefan Strötgen

About Dr. Stefan Strötgen

Dr. Stefan Strötgen, formerly partner at the Institut für Marken-Emergenz, Cologne, and now partner at LUXKASTENS, Zurich (www.luxkastens.com), is an expert for semantic brand strategies. He read Musicology, Business Administration and Linguistics at the universities in Bonn and Cologne. At the University of Bayreuth he graduated with a PhD-thesis on semantics of music with regard to brand management. Furthermore he fills the position of an information designer at Simon-Kucher & Partners, Bonn.

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