Brand and Relationship Value Differentiation
In our previous article, Commercial Growth Strategy (1), we introduced the “TGIF” Commercial Growth Strategy Framework to guide your strategic roadmap. No matter what growth roadmap you may have created, value creation will need to be at the core of your strategy. The value that you bring will differentiate you and confer competitive advantages for your business to grow. We have outlined 6 value differentiation categories of Brand, Relationship, Channel, Products, Services and Price (Table 1). In this article, we dive deeper into Brand and Relationship value differentiation.
Brand Value Differentiation
The typical differentiation businesses tend to consider are product and services and/or channel access. This is then used to establish the benefits of how products, services and channel access are superior to the competition. Example of benefits includes price, speed, quality, geographic access, size, menu spread, etc. Traditionally a company will develop and build their brand profile and reputation to highlight these benefits. This seems reasonable to do, but the result is often a sea of sameness where one brand is hardly distinguishable from the other.
Given that branding is to influence choices, how could we expect a brand, built from a list of benefits, to confer any value differentiation and to influence the customer to choose it? Branding is about building human emotional connection and not just a list of attributes to remember and measure against. Consequently, while much effort was made to quantify brands, we often still described them as difficult to quantify. Description of brands tend to be words like perception, experience, loyalty, and trust, which are emotional description and could even be irrational consideration at times. Having human connection is hence a critical part of your brand building strategy.
To establish this emotional connection, it is important to understand and incorporate behavioral science into your brand building strategies. Much research on this subject had been done and some great books covering this topic includes Nudge by Richard Thaler & Cass Sunstein (2), Thinking Fast & Thinking Slow by Daniel Kahneman (3) and the more recently published Branding Between the Ears by Sandeep Dayal (4). While the topic is still evolving, we could conclude the following three observations:
1. Our minds relate much better to story lines, patterns, and colors etc. as opposed to a long list of attributes.
2. Sharing empathy and values create emotional connection and build up trust more effectively than just facts and figures.
3. More than 90% of our daily decision making are made by the subconscious mind. This is driven by our experience and instinct where our brain had created a set of rules, also known as cognitive bias, to simplify the complex world of information we are inundated with.
Thus, any brand strategy should be built around an empathetic and honest story reflecting values that connect and resonate with your target audience. Success would help establish trust of your brand and confer a valuable differentiation to gain the competitive x-factor advantage that influence decisions in your favor.
Memorable brands are built on emotional connection and not from a list of benefits
Relationship Value Differentiation
Organizations frequently conduct win-loss analysis to better understand the root cause of winning and/or losing of deals. In such analysis, the sales team would be interviewed, and they would often attribute the winning factor to their “strong relationship with the stakeholders”. Like brands, relationships are hard to measure and quantify. Proxies are often used such as the ability and ease of scheduling meetings, their friendliness, their openness in sharing information or even to the extent of sharing gossips. The friendlier, the more open and the more receptive they are towards you, the “stronger” the relationship is deemed to be.
How could we replicate and scale up this winning factor of “strong relationship”? Like brands, human emotional connection is again the basis of relationships. While sales teams are often in the limelight, being the ones holding the relationship with customers, any employee’s interaction with customers, whether it is the technical or service specialists, customer service representatives, project manager or logistic deliveryman, is an equally important touch point. Given the multiple touch points, this would thus be best described as the customer relation that is shaped by their experience and interaction with your organization.
To build great customer relation, it is best to start with understanding the customer’s needs. Although quality and price could still affect purchasing decision, it is their experience with your organization that will build trust, loyalty, advocacy, and even induces their willingness to pay more for your solutions. A PwC survey (5) of 15,000 individuals across 12 countries revealed that speed, convenience, knowledgeable help, and friendly service are the most important elements of a positive customer experience. As such, building a strategy that focuses on delivering these aspects seamlessly will be instrumental in fostering great customer experience.
While your employees’ interactions were the traditional touch point in shaping your customer’s experience and relationship, social media is increasingly gaining importance in affecting their overall experience with your organization. In fact, customers are increasingly moving their interaction with organizations to social media. Poor customer service would no longer be a private matter but a public affair. This could have huge repercussion for your organization's brand and reputation. Further risk includes involvement of regulatory authorities that your customers may tag to their complaint post.
While there are clear risks, the benefit of getting it right is tremendous too. Positive recommendation, testimonial advocacy, and willingness to share great experience will promote awareness, trust, and emotional connection to your organization conferring valuable relationship differentiation for the competitive advantage.
Open the door with your brand.
Enter it with your relation
The Right to Play and Play to Win
The fundamental challenge for any commercial growth strategy is not just identifying where the growth is coming from, but also what, where, and how to differentiate and compete better. As the saying, “your reputation precedes you”, so does your brand. Deep understanding of your customers and appreciation of behavioral science are keys to developing your brand that connects with your target customer’s value with empathy.
Although credible brand will gain you entry into the game, it is not enough to secure the win. To win, besides having the right product with the right quality at the right price, an important factor is your customer relations. Positively shaping their interaction and experience with speed, convenience, knowledgeable help, and friendly service will strengthen the relation. In turn, this would influence their choice in your favor and even increases their willingness to pay a price premium for your solutions. Recognizing this, many organizations have invested in automation to improve speed and convenience. Nonetheless, it is paramount that contingency plans are in place for the human touch when things go wrong, as it is your employees who will drive the customer experience. Empowerment of your employees with service recovery considerations will greatly improve the experience and strengthen their relation and loyalty to you.
For organizations that may be venturing into new markets where your brand may be unknown and you do not have any existing relations, “buying” or “borrowing” them could be feasible options to accelerate your market penetration plans. This could be through an acquisition (“Buy”), or with appointment of reputable local distributors (or individuals) and leveraging on their previously established relationship (“Borrow”).
Stay tune for our upcoming article where we will discuss more about the channel value differentiation including consideration for geographic expansion into new territory. Or simply follow us on our LinkedIn page so you don’t miss any articles updates.
References:
- Commercial Growth Strategy. https://www.asiadx.org/commercial-growth-strategy
- Nudge. Nudge by Richard H. Thaler, Cass R. Sunstein: 9780143115267 | PenguinRandomHouse.com: Books
- Thinking Fast & Thinking Slow. Thinking, Fast and Slow - Wikipedia
- Branding Between the Ears. Sandeep Dayal
- Future of Customer Experience. https://www.pwc.com/future-of-cx
Glossary
- TGIF – Thrive, Geographic expansion, Intensification, Fortress building
- PwC - PricewaterhouseCoopers
