IEF: What is the role of branding in the way a startup reaches its target audience?
Sourabh Mishra: A brand is a concept that exists in the mind of the consumer. If the start-up entrepreneurs can sharply define who their target audience is exactly, then they can work towards establishing the idea of the brand clearly. A fuzzy or loosely defined brand is often a symptom of the lack of strategic clarity in defining the exact target audience. This lack of clarity can hinder the business’ ability to reach its target audience – not only in terms of the brand’s communications but also its ability to deliver the right experience to the right people.
IEF: A lot of first-time entrepreneurs reduce brand and identity to just the logo. How would you explain the intricacies?
SM: Defining the brand is at the core of the business, it’s raison d’être. A good brand captures the purpose of the business and expresses it as a brand idea. This brand idea is then manifested through multiple touch-points and the logo or brand design identity is just one of those touch-points, even if an important one. Beyond the logo, the brand idea has to be expressed in every design element (packaging, product design, retail design, office design etc.), brand communications, product innovations, the work culture of the organisation etc.
IEF: What is the difference between the way a consumer interacts with start-up brands and the way (s)he engages with established brands?
SM: An ‘established’ brand is usually a brand that has been around a little longer than a ‘start-up’ brand. And I use the word ‘usually’ because some brands even if they have existed for a longer period of time, still fail to establish themselves. This happens because they lack a strong core defining idea. So an established brand is a brand that stands for a set of values in the minds of its target audience. This strong perception of the brand sets up expectations in the minds of its target consumers. With a start up brand, these expectations are not yet sharply established, so the consumer is more open to what the offering is. At the same time, this also makes the marketer’s task tougher as the consumer is less likely to risk purchasing and consuming a brand where she does not know what to expect.
IEF: What role does branding play in determining the valuation of a start up versus its physical value?
SM: A strong brand adds immensely to the valuation of any organisation. Think the Coca Cola Company – its most valuable asset is the brand Coca Cola. Similarly as a start up brand gets better established in the minds of its target audience, it makes the consumer’s purchase decision making process easier by creating a preference for the brand. This preference translates into value for the business, thus driving up its valuation.
IEF: How does brand strategy help the internal workings of a startup?
SM: We spoke earlier about a good brand idea incorporating the larger purpose of the organisation. This brand purpose has to be reflected in everything that the organisation does. The ability of the organisation to ‘live the brand’ impacts its ability to deliver a holistic brand experience to its consumers. If the organisation is not geared to providing a unified and holistic brand experience, then there will be a gap between what the brand ‘says’ and what the brand ‘does’. Today’s informed consumers are very unforgiving of these gaps between brand-say and brand-do. They punish these inconsistent brands and organisations by deciding not to buy, thereby lowering preference scores, market shares and ultimately the company’s valuation.
IEF: Just as award juries consider media perception nowadays, do investors also keep an eye on the chatter around a start-up in industry or/and consumer corridors?
SM: The chatter around a start-up in the industry as well as consumer corridors is often a reflection of the traction that the idea behind the start-up is generating. Investors would thus track the chatter around the start-up as one of the parameters to evaluate it. Which is the reason why good Public Relations agencies are hired to manage and maximise this chatter. However, there is a caveat here: investors have a sharp nose for artificial or fake chatter around a start-up. So it is important to get the basics right to ensure there is genuine interest leading to the chatter rather than buying fake chatter.
IEF: Marketing guru, Philip Kotler once said, “If you are not a brand, you are a commodity.” What’s your view about the statement?
SM: Absolutely agree. And if you are a commodity, you do not have the brand’s ability to command a preference and a premium in the market.
IEF: How is PR evolving to support emerging brands?
SM: The story of the brand has to be told to the world through various touch-points. PR is becoming an increasingly important touch-point, more so given the rise of social and digital media. Good PR today tracks the ‘chatter’ or conversation around a brand in as close as possible to real time, ensuring that the brand narrative never goes out of sync with its core idea and values. This also ensures that a good PR opportunity never slips by. PR agencies today play an increasingly greater strategic role in managing the brand’s narrative. The other important role for PR is crisis management – in today’s always connected and over-informed world, a small mistake can blow up into a big crisis very fast. It is important to have PR professionals by your side if a crisis hits your brand.
IEF: What impact do digital and social media have on the way startups construct their identity?
SM: Digital and social give the opportunity to start-ups to level the marketing playing field with the big brands. They make larger markets accessible to start up brands, which would have taken a lot more time earlier.
IEF: What startup brands do you think got their brand strategy right to the T? Why?
SM: One of my favourite start-up brands is the beverage brand Paperboat. They have a very strong central brand idea which inspired the setting up of the business. And then this idea was carried forward in their product development, their communication and even the name of the brand. Paperboat seems to be a brand with very few gaps between its brand-say (the communication claims) and its brand-do (the overall experience of the brand led by the products they launch).
Another favourite is OLX.in – a very strong consumer insight driven brand idea which then manifested extremely well in its communications, but also in its promotions and product innovations.
IEF: Advertising is an expensive proposition for any brand. How can a seed stage startup build its identity without burning its coffers?
SM: Use the power of social media, digital, mobile and good design to the maximum.
Invest the time and effort required to get a sound brand strategy in place right at the beginning and make sure that the brand identity and design reflect the strategy.
Take the effort to learn to become more PR savvy if you can’t afford a PR resource in the beginning.
Get a specialist mentor on board your company to help you with getting the brand basics right.