5 things you should do for your brand's growth despite economic crisisBY SAMIR DIXIT
In 2012 so far, financial analysts continuously predicted when the stock markets would reach an optimal level and the magnitude of their recoveries.
Towards the end of 2011, many analysts suggested that markets have recovered and mid to long term economic stability is within sight which is yet to be proven with several indication of prolonged crisis from across various geographies, particularly Europe and the contagion effect of a continued European economic slowdown.
An analysis of the domestic environment suggests that economic prospects will remain under watch for Singapore for the rest of this year. Singapore’s economy growth is likely to slow to 1-3% this year following the close to 5% growth in 2011.
The slower growth reflects the unpredictable global market conditions, particularly continuing weakness and uncertainty in the US, the Euro zone and Japan. This might adversely impact the intangibles in 2012.
As monetary brand value is in part a function of financial performance (including revenues achieved and margins commanded) of the associated enterprise, strengthening demand conditions will generally strengthen brand value. Brands with strong value-based positioning will thrive.
In times of recovery, we can expect to see companies who continually invested in their brands during the downturn to reap exponential benefits, achieving significant reach and share of voice in the market.
On this note, perhaps the more relevant issue for brand owners is: What should they be doing to continuously capture the economic growth opportunities for a strong and sustained economic recovery? We summarise our perspectives as follows:
Invest in Value Drivers
Invest in talented people who will drive innovation that companies can leverage upon to boost your company’s value; invest in vital marketing activities (for example, those that drive customer loyalty) and public relations activities to shout out.
While some companies have had the foresight to invest in marketing during the downturn, it is important not to be complacent as competition is rising.
More deeply understand the drivers of your brand’s value.
Quantify the company’s brand’s value, derive insight into the key drivers therein, and connect the organisation’s current investments against each driver area. Identify areas of inefficiency in marketing and streamline business development activities.
This assessment will provide insight on how to best allocate resources going forward, ensuring the company’s competitive advantage.
Companies that are eligible for SPRING Singapore’s Capability Development Scheme can leverage on the available grants for brand valuation.
Sharpen the company’s brand’s positioning and key point(s) of difference.
A recessionary climate tends to lay bare undifferentiated brands that deliver questionable value. A meaningful, differentiated positioning preserves profit margins and provides purposeful brand investment.
Ensure organisational alignment to support consistent brand delivery.
No significant amount of brand investment – in good times or bad - can be justified if the brand promise is poorly delivered. Seize the opportunity to examine how the company’s brand is delivered against all key touch-points and stakeholders, and spearhead initiatives (across the organization) to address opportunities and gaps in this regard.
Internationalise your brand via mergers and acquisitions
Cash rich Singapore companies can increase their value through the acquisition of or joint ventures with foreign companies, which have valuable synergies. Companies that are eligible for IE Singapore’s Brandpact scheme can leverage on the available grants for brand developmental efforts.
Samir Dixit, Managing Director, Brand Finance Singapore