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Brand equity and how to lose it…

15/04/2011

Amongst the ongoing debates around business and charity branding, I’ve not seen much discussion around the concept of brand equity.  As defined by Wikipedia, this is:

The commercial value that derives from consumer perception of the brand name of a particular product, rather than from the product or service itself.

For non-profit organisations, this will effectively translate to the sum total of the reasons people support, trust or work with you when they have a choice not to.  Basically, what you do, how you do it and how you represent yourself to the outside world which underpins your attraction to various audiences.

So when an organisation has successfully spent years building these reasons for its target audience to trust and engage with it, there can be a significant risk that any change in their brand might undermine these reasons and put future success in jeopardy.

In reality, a change of name and colour palette does not generally undermine brand equity.  For example, I don’t believe The Army Benevolent Fund’s fundraising and volunteer efforts will be damaged by their change of name to ABF The Soldiers’ Charity.

Similarly, if the RNLI (one of the most successful fundraising outfits in the UK) changed its name to ‘Lifeboats’ and its core colours to green next week, I can’t see their supporters withdrawing their patronage.

In both cases this is because these charities have built brand equity with their supporters and beneficiaries.  They have consistently delivered what they are about in the eyes of their target audiences and have therefore earned the right to be ‘trusted’ with continuing to do so.

They walk the walk and their audiences agree.

In his blog this week Jeff Brooks talks about the key facet of brand being the audience’s perception of an organisation rather than any internal or brand guideline-derived view (although the blog implies that the only key audiences are donors and I believe beneficiaries and other stakeholders have a bearing too).  The audience is indeed king in this equation but that’s not to say they are always right and that brands should bend and flex to consumer whim every time the wind changes direction.

Equity takes time to build so the most successful organisations steer it in the direction they need their brand to take them, in line with their future objectives and plans.  Always being mindful of the benefits their track record brings but ensuring their history is used as a springboard to the future, not a millstone.

The best example I know of is Cancer Research UK which was itself formed by the merger of two large charities not so long ago.  A few years on and the organisation has grown and continues to support ground-breaking research concurrently with running some of the most well-supported fundraising activities in the country.  Many critics of branding argue that it adds no financial value but I counter this point with the simple fact that, like any process, it has to be executed well to work well.  Cancer Research UK has raised over £1.7m since it re-branded and its volunteer numbers continue to grow.

Other charities and commercial organisations haven’t been so successful in getting this balance right – I won’t name names to protect the innocent but we’ve all seen a few examples recently.

That said, a great example of how to potentially waste brand equity appeared this week in the shape of British Airways.  The airline announced in trade press that it is about to embark on a ‘re-launch of its brand but is keeping details under wraps until the autumn’.  I would suggest that whilst they are suffering industrial action from staff, consequently having to cancel flights and facing the resultant customer backlash, now is not the time to be spending money on a big-London-agency-rebranding exercise.

They should perhaps get back to walking their walk first?

What do you think?

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2 Comments leave one →
  1. Aidan permalink
    15/04/2011 10:11 am

    Hi Kevin,
    The Irish Heart Foundation has “re-branded” in the last year. What is particularly interesting is the internal vs external perception of what this process meant. Internally at a senior management team level, we spent many hours on effectively translating the key pillars of our strategy into taglines, logo, colours, values etc. What we came up with was some basic improvements – and most importantly a consistency to our messaging. Running along side the internal, we did a small bit of research with both donors, volunteers and supporters. This was the really interesting bit – because the internal perception was whether people wanted to support our research or our health promotion or our CPR training….but the only message that consistently came across from people was “we support you because you do good work”. I’m a marketer by background and have spent millions on the commercial side on brand and insight research but this recent exercise has taught me more clearly than any focus group….its the work! Do it well with honesty and integrity and you will be supported! Or as you say….walk the walk!
    Aidan

    • Kevin Baughen permalink*
      15/04/2011 11:51 am

      Great thoughts Aidan, thanks.

      The differences between internal and external perceptions of a brand (in terms of what an organisation does and how it goes about it) can be the single biggest reason so many people believe that branding is a waste of time!

      Tying these perceptions together with the organisation’s objectives is where the value really comes from. Once we have this sorted, consistent delivery of the most important messages becomes much easier.

      Glad to see the Irish Heart Foundation doing so well with this approach. I’m certain you will be punching above your weight in communications terms as a result.

      Kevin

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