By Dr Paul Temporal
1. A strong brand will survive the most intense competition
Once a strong brand is developed, it acts like a weapon against the competition. If customers are comfortable with and trust a particular brand, other companies will find it very difficult to compete for the same business. Greater mind share from consumers leads to a greater market share, even in the face of competition. As good examples, IBM, Colgate, Kodak and Xerok have constantly been rated as their respective industry leaders for decades.
2. Brand building helps B2B companies get out of the commodity trap
With growing competition across industries, products and services are becoming increasingly commoditized in every way. Every company needs a strong brand to ensure their products and services are not seen merely as commodities. When entering into new markets, a respected and internationally recognized brand will gain market penetration more easily and at a lower cost. Even if the brand name is new and has little awareness, a good brand strategy will often differentiate it from the competitors, helping it gain better acceptance more quickly.
3. A strong brand lowers concerns that people have with new products or services
People are more receptive to new products and services if they have pre-existing confidence and trust in a particular brand name. When people like a brand, they tend to stick with it, and because of this intangible value, are even receptive to paying more for these offerings. In addition, strong brands have the advantage of being able to find ready markets. This also enables the company to be able to franchise and license them more easily and more profitably than for a weak brand.
4. Good branding creates stickiness
Strong brands are like glue. They bring products, policies, advertising and customer service together with a strong message that people can relate to easily. A well-known brand name conjures up all sorts of positive thoughts in people’s minds when they see or hear it. This helps cement the relationship between brand and customers.
5. Powerful brands provide efficiencies and profits
Branding allows B2B businesses to focus on the values their customers want. It also provides a uniform ideology across different aspects of operations to improve processes and provide cost savings. Branding also helps retain customers, in turn, generating economies of scale, lower unit costs, greater margins and improved profitability, ultimately enhancing customer loyalty.
6. Brands provide risk assurance for customers
B2B buying decisions involve significant investment, sometimes adding up to millions of dollars. A lot of careful thought must therefore be put in to ensure good decisions are made. Strong brands help buyers avoid risky decisions because they stand for trust and quality. As the old saying goes, “No one ever got fired for buying IBM”. Assurance is critical for the B2B purchase decision and brands can help provide this. Brands are trust marks. They relieve buyers from stress and risk.
7. Good branding equates to positive word-of-mouth
Word-of-mouth is a powerful tool that can enhance a company’s image. It can also make or break a brand. B2B companies have to ensure that their systems, procedures and quality levels are carefully monitored to ensure a healthy brand image with its customer and supplier base. It becomes vital for companies to get their brand strategy right to be successful in the long run.
B2B Branding In Malaysia: A Guide to Building Successful Business-to-Business Brands