You may have often heard it said that there are only two certainties in life, death and taxes. Thanks to the online revolution we can now add ‘increased choice for consumers’ and, as a result of that increased choice, ‘increased competition for businesses’.

The choice pandemic

When I was a young child, a distant family member visited us from Estonia and though I don’t remember everything about her visit, one thing has stuck with me all these years. As we were showing her the local shops, we passed a monstrous hardware store that had an immense array of products displayed in the window. Our visitor, who lived under Soviet rule, assumed that as wealthy westerners we owned every type of item she could see in that window. Now while that seemed a little bizarre at the time, it’s become closer to the truth than we care to admit.

I was lucky to grow up in a society where personal choices were allowed and encouraged, but when I was growing up the number of choices an individual had was still fairly limited. Back when my parents bought their first car they could choose from a Ford, Holden or a second-hand Vauxhall. Today, however, it’s a very different story. At last count, today there are over 300 different vehicles on the market.

In Al Ries and Jack Trout’s book ‘The 22 Immutable Laws of Marketing’, the authors identified the ‘law of division’ to explain the current explosion of choice. They view the market as an ever-dividing sea of categories, not unlike an amoeba dividing in a petri dish.

A business category always starts with a single choice or entity. Automobiles are a great example. The motor car was invented in Europe (Germany, to be specific), and at the start of the 20th Century, all motor vehicles were built one-by-one using the ‘coach-building’ method.

But in 1908, Henry Ford transformed the car manufacturing industry. He started with the premise that for more people to be able to afford cars, cars needed to be cheaper. This idea sounds simple enough, but in reality, it meant bringing the cost of a car down from around $4000 (twice the average annual income at the time) to less than $1000.

To achieve this Henry introduced the ‘assembly line’ for motor vehicle construction. By claiming that Model T could be bought in “Any color … so long as it is black”, the Ford Motor Company was able to grow sales from 10,000 cars manufactured in 1908 to 472,350 cars in 1915 to 933,720 cars in 1920.

Gradually, however, the market began to expand. Along came Chevrolet, Chrysler and Plymouth in the early 1950s, and eventually the European and Japanese car manufacturers sprang into the market. Two-door cars, SUVs, station wagons, sports cars, high-performance cars and four-wheel drives are now options, and now China is adding to our choices.

The same effect can be seen in the computer industry. The first personal computer manufacturer was ‘the big blue’ – IBM in partnership with Packard Bell. Fast-forward a few years and not only do we have dozens of computer brands, we have a confusing range of desktops, laptops, tablets, watches and wearables.

If you walk into a supermarket or a huge big-box superstore today, the myriad of choices assault the senses. For those of us running a business it’s important to note that this explosion of choice has proliferated into every market segment and will continue to do so.

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Have you ever stopped to think how Apple, DHL or Virgin became such dominant empires in so little time? Have you considered how the Nikes of the world get each moving part of their business, from their branding and design through to their marketing and PR, so in sync? Their brand, mission and products move with the precision of a fine Swiss watch.

Smaller companies, however, often struggle with integrating branding into their planning process. This is understandable, as most small business owners do not have a marketing degree or practical branding knowledge and experience, and it is this lack of education that often limits business growth. Sure, if you’re flush with cash you can bring in a large marketing and PR firm to create and execute a brand strategy based on your vision, but what about the rest of us with smaller budgets? Is there a way for us to create and nurture a brand?

Of course there is. I have spent ten years studying dominant brands to identify what they have in common, and I have discovered that much of what they do has nothing to do with the size of either their company or their budget. The following are key points when studying and learning from dominant brands.

1) Dominant brands change people’s lives
There are only two ways to approach branding: branding that positions a product as a solution to the customers’ wants and needs as they already exist, or branding that steps up and says, ‘I want to change people’s lives, change perceptions and change the way people spend their day.’ If you think about it, almost all great brands changed something.

• Nike has changed the way we think about sport
• Armani has changed the way that we dress
• Google has changed the way we access information
• Apple has changed how we share music and memories
• Uber has changed the way we get around a city
• Airbnb has changed the way we house ourselves in different cities and countries

2) Dominant brands make waves
Brands that make waves, big waves, reap the rewards. TED made waves, Cirque du Soleil made waves, and in their own market Bunnings made waves, all by bringing something new and unique to the table. On the other hand, Masters (a failed competitor to Bunnings) was merely following a trend and paid the price. If you want to start a home improvements organisation, you better be prepared to take large risks in order to create big waves in an already competitive market, because if all you are doing is following it, you’re following it down. That’s not where you want to be.

3) Dominant brands take risks
Running a business or building a brand comes with a certain amount of personal risk. What are you prepared to risk to build your dream brand? Brands that get noticed often break values or traditions. The Voice and The X Factor have had to cop a lot of criticism from within the music industry to make waves and make their creators very rich.

Where are you prepared to show up and what are you prepared to say? Moving forward and going out to the world with an idea that changes industry norms has many risks, and you’re more than likely going against somebody’s better judgment, so be prepared for flak from partners, the bank, your community, or even the press.

4) Dominant brands have an enemy
How do you rally the troops or find believers and supporters? How do you get people to believe in what you believe in, driving them to help you succeed and grow? What if I suggested taking a leaf out of the politicians’ book? Find an enemy and leverage it!

To galvanise support we often see politicians identifying and attacking an enemy – gun laws, street violence, hospital waiting lists. Why? Because it’s a great tactic to bring together people who share a common mind; it stirs up feelings of being on the same team and provides a clear focus.

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So how do dominant brands create and execute their brand strategy? How do they connect with their prospects at a more emotional level?

Firstly, they never begin with design!

Let’s face it, it’s tempting just to start printing out business cards, pop out a website and start hunting for clients. It’s tempting to start trading and getting money into the door, but that’s a huge mistake. By jumping in and simply starting your business (sound familiar?), you’re missing the first and most important step: crafting your strategy. The imagery, style and colours you choose for your marketing collateral and website may show the world what you look like, but what about the most important aspect of your business: who you are, what you stand for and why should somebody buy from you?

Having worked intimately with both international brands and SME’s for over 30 years, I’ve thought a lot about why smaller businesses often jump in and simply start, while the fortune 500’s of the world take a completely different approach.

The one fundamental thing I’ve discovered that ‘all great brands do to become great,’ (and virtually immune to worldwide recessions,) that distinguishes them from the average business is:

• Great brands have a strategy first approach.
• SME’s have a tactics first approach.

Once the domain of the world’s biggest brands, a strategy first approach has never been more important if you want to build long-term success.

Loosely referred to as a ‘strategic branding’, or creating a ‘brand strategy’, it’s involves a planning process that applies innovation, strategic thinking and operational planning to develop business strategies that have a greater chance for success.

Nobody would build a house without a detailed plan, so surely the same principle applies to businesses?

So what is a brand strategy?
A Brand Strategy answers the question: “Why should somebody buy from you instead of the competition.”

It is a process of examining everything you do and understanding the needs of your customers and ensuring that all of this is linked to clearly defined strategic imperatives.

A Brand Strategy knits together three disciplines:

1. Strategic Thinking – that’s the “What” and the “Why”, that is what should we be doing and why.
2. Strategic Positioning – that’s the “How” you will compete in the market and differentiate.
3. Operational Planning – the specific goals, objectives and tactics at a high level.

The purpose of a Brand Strategy is to create a roadmap, or a plan, that is a coherent, unifying, integrative framework for decisions. Especially one that influence the direction of the business and its competitive advantage.

Unfortunately, however, when most small-business owners hear the words ‘brand,’ ‘brand strategy’ and ‘positioning’, they think ‘big brands.’ They shake their heads and lament that they don’t have the resources to do big-brand marketing.

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