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When Opportunity Knocks, Be Sure Your Brand Value is Ready

Brand Value

As a business owner, you want to be as prepared as possible should someone come courting to buy your business or for when you are ready to sell it. There is a lot of preparation involved and much of that advice comes from attorneys, lenders, financial planners and brokers on how to position your company to achieve the best multiple.

But don’t forget the marketing side of that equation: How well you are known in the marketplace, your company reputation, proprietary trade names or processes all adds value at the end of the day.  It factors into how well you played the game of business while it was under your leadership. This equates to brand value. For companies such as Coca-Cola, Apple, Google and Starbucks, brand value trumps book value by leaps and bounds.

So how do you get your business value to increase based on your brand value? Great question. It starts with winning in mind. Every industry has a multiple average. Brand value represents the multiple that can be attributed to future sales generated from brand loyalty. Your company can fall on either side of that industry average. Your goal from a marketing perspective should be focused on scoring an above average rating and to be considered best in class in order to increase your potential multiple. It is easier to be average today and harder to be exceptional at what you do. How can you be exceptional?

Know What It Takes to Be in the Lead

Be proactive rather than reactive. When you rethink best practices, you stop reacting to the market and start shaping it. Have a keen understanding of what makes your company different. Understand how your product or service offering is different from what is available in the market. Understand why what you are offering is important to potential customers. Ask them. Why should they choose your company? Address core needs that are overlooked by everyone else in your market space. Lead somewhere exceptional. Own the mind share.

 Look Like the Leader

Start by investing in your business. Do an inventory of your marketing and how you measure up to others in the industry. Do you look like the leader? Your online marketing should be solid, including an up-to-date website that is competitive and well-optimized to compete online. You should have a strategy for generating and tracking online leads, and, if possible, know what share of online opportunities you receive.

How do you present your products or services? Do you create a memorable experience or just appear like a “me, too?” Are your trade publications regularly including your company in editorial coverage? Build brand assets by naming and trademarking your processes. This allows you to be the only one in your industry that can offer the iPhone® or iPad®, or proprietary ingredients, or own the search algorithms, or loyalty club that has millions of members.

Act Like a Leader

Operationalize your unique brand position. Build an internal and external culture that breeds brand ambassadors. Create processes around what it takes to deliver first-in-class service. Communicate with passion and ad nauseam what the company brand stands for and why it is important to assure brand clarity, educate and inspire all employees to live the brand. Also, keep customers and their needs a top priority. Figure out what it will take to earn a customer’s trust and business for life. Then hang on to those customers for dear life.

At the time of sale on the balance sheet, these are all considered intangible assets. These intangible assets have been known to push the value of your company 30 to 70 percent beyond book value. So, while it does take some initial investment, the return can be greater than investments in tangible assets such as real estate, inventory, equipment and the like. Focusing on the intangible assets may make more sense, both practically and economically. Investing in building brand value can produce nice rewards when your time comes to cash in on your business investment.

 

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