Why Branding is Important for Small and Medium Businesses
A strong brand identity is pivotal to the success of small and medium-sized businesses (SMBs). Effective branding will help build a reputation, and ensure that your company stands out from the rest of the competition. It will project your values and mission to attract the perfect clients.
A brand is your business identity, the image you portray to the world, and it is one of the most valuable assets of your company. Even though it is important to have a visual brand identity, your brand is much more than that. Your brand is an expression of your business personality which is used by your clients to form an impression. Your brand projects the promises and expectations you offer to your customers and prospects in terms of services, trustworthiness, reliability, and quality. It influences the purchasing decisions of your customers, having an impact on your profitability.
Branding is important for small and medium-sized businesses for the following reasons.
1. Improves recognition
Branding is everywhere and helps your customers and prospects identify and connect with your company. As it is the face of your company, the design of your logo plays an important part in improving recognition. It is a simple graphic which will be in all your advertisements and products. A logo that is designed by professionals will be simple enough to catch the eye of your customers and prospects, and powerful enough to have a good impression of your company. For example, when you see a 'golden m', you instantly associate it with McDonald's. Your website design should incorporate your logo in such a way as to project it effectively.
2. Creates and increases trust
Effective branding gives your company a professional appearance, which builds trust and credibility. It conveys your business value, which will form an emotional connection with your prospects and customers. As a result of this, your business will appear more legitimate and polished to your prospects and customers, in turn attracting them to your company. Having a deep emotional connection with your prospects and customers will lead to the development of a long-term relationship, increasing customer loyalty. For example, take a look at Apple. The moment you see it’s logo on a product, you know you are looking at a high-quality product.
3. Supports advertising
Advertising is one of the main components of your brand. The demographic targeted and the medium selected for advertisements will help in building your brand. Also, advertisements allow your prospects and customers to form a connection with your brand. If your advertising focus is too narrow, you lose the ability to expand into new markets. However, if your advertising focus is too broad, your company won’t make a definable impression on your prospects and customers. For example, the strategic placement of Nike's logo here and there. Even if it isn’t direct advertising, it still has a solid impression on prospects and customers all over the world.
4. Boosts financial value
Companies that are involved in public trade on a stock exchange are valued based on their hard assets. Branding is an intangible firm asset, having an impact on stock prices. A strong brand guarantees to have business in the future, which increases the perceived value of the company. Whether your company is opting for an Initial Public Offering or it is in a position to take loans for expansion, having a higher perceived value will be advantageous. Your company will receive higher financial returns if it devotes its time to build brand value.
5. Inspires employees
When you make your employees a part of the branding process, they form a powerful and emotional connection with your products and services. They will have a better understanding of your company’s mission and work towards achieving your goals. Your employees work harder and they will remain loyal to your company. It unites your employees as they have a common identity and purpose.
6. Attracts new customers
Effective branding will have a positive impact on your business as it increases the chances of getting referral business. The goal of branding is to leave a long-lasting impression on your prospects and customers. When your customers are happy with your products and services, they become one of the most profitable sources of advertisement, referrals by word of mouth. For example, if you buy a pair of shoes from Nike and you are happy with its quality and usability; you are most likely to tell your friends to purchase shoes from Nike.
Remember, if you want your business to be profitable, you have to establish a strong brand. By aligning your brand with your focuses and vision on the requirements of your target audience, you will be able to attract the right type of customers for your business.
You can take the help of Mouth Media for effective branding. Our professional services are designed to meet all your brand management and image requirements.