As a consumer, most of us avoid choosing products or services we know to be terrible.
For a restaurant, it could be due to the hygiene rating, delivering poor value for money, or awful service the last time you visited. Any of these would be enough to put me off visiting. That is probably the case for most people.
The principle translates across sectors. You wouldn’t buy a car from a company or dealership you know to sell unsafe cars.
You wouldn’t use a tradesman who had consistently terrible reviews, and you wouldn’t let a drunk taxi driver take you home.
Yet, in the corporate world, this buying logic doesn’t follow. Individuals persistently have bad experiences with companies and return for more.
Bad service? Forgotten. Late delivery? Ignored. Pricey? That’s fine. The reason is fear.
So, why do we accept it?
Sometimes, the buyers might not have noticed the bad service, the extent of the missed deadlines, or the soaring cost of projects.
Other times they are happy to turn a blind eye. A common reason is because the perpetrator works for an entity with an established brand. In marketing, we talk about brand a lot.
Especially in the current macro-economic climate. The ROI from brand investment stimulates just as furious a debate.
For the purposes of this article, I want to concentrate on the power that a strong brand has for retaining long-term contracts.
For business development teams, it is obviously useful to walk into a room and for everyone to have an idea of what you stand for. But the true power of brand is in client retention and account growth.
There are so many instances where senior financial marketers have told me how they want to switch supplier but have been too scared to do so. All too often, it is because the incumbent supplier they are using is a huge brand.
In the late 90s when I was studying for my corporate comms degree, I remember a lecturer saying that “nobody ever got fired for hiring IBM”.
For the record, I have no idea whether IBM is a good supplier or not, but that was the example that was used.
Since then, I’ve been lucky enough to work with hundreds of corporate employees and I think I get it.
Positive vibes
Building a brand with a reputation, that conjures positive vibes, doesn’t just work to your advantage when you are bidding for new business, it puts down roots deep into an organisation.
The biggest and best brands, in fact, put their roots in so deep that they rarely lose those clients.
In financial services, especially now, when margins are being squeezed, marketing spend is under the microscope.
While it is increasing in many of our agency’s sub-sectors, marketers are again being asked to measure everything like a transaction.
But brand building just doesn’t work that way. It can take multiple exposures before brand power really comes alive.
There is a huge difference between performance marketing and brand activation. The latter requires a longer timeframe but the rewards in the long-term are far more significant.
The current macroeconomic and geopolitical environment is the perfect time to spot those brands who put in the investment in the years before.
It is equally easy to see those who remained transaction-led.
In a way, it’s a little like insurance. Brand value often only comes into its own when guaranteed quality matters. And, that time has now arrived.
- Joe McGrath is the founder of Rhotic Media.