A question I’m often asked goes something like this:
“If I have an innovative idea, what do I do when people start copying me?”
It’s a fair question. After all, real hard physical competitive advantage never lasts forever. If you’re doing something cool, the competition will always catch up.
- Back in the 1990s, Apple was genuinely hugely differentiated from its competitors. Now it isn’t.
- Back in the 80s, you couldn’t get furniture like IKEA’s from anyone other than them. Now you can get it everywhere.
- Back in the 2010s, Airbnb was the only option for peer-to-peer hospitality. Now they’re one of many.
It seems like no matter how smart your strategy, and no matter how cool your idea, you will eventually lose your position, and slip back into commodified sludge.
…and yet, somehow, you don’t.
Apple still stand alone. So do IKEA. So do Airbnb.
So do most of the great brands who carved out new space in their market, only for copycats to come flooding in.
Why?
Because of brand.
Brand is the force that enables companies to maintain “psychological” competitive advantage long after “real” competitive advantage has been drained.
It’s the thing that ensures a business remains associated with a given market position, even if rationally there are many other options that do just as good a job.
The formula is really very simple:
Innovation claims market territory.
Brand keeps market territory.
Of course, this is very different from the way most people typically think about brand. Normally it’s seen as a sort of veneer to make a business look more appealing than it really is. It’s something that many businesses use to try and claim market territory that they don’t really have any right to.
People will go to a branding agency to “do their branding”, as if it is the branding itself that is going to drive sales.
They don’t realise that a reputation needs to be earned prior to effective branding, which then merely carries it.
It’s basically used as a sort of “cheat code” – to skip the hard yards of strategy and innovation.
And it’s a cheat code that doesn’t work.
If you want to build a genuinely awesome brand, the formula is tough but simple:
Step 1 – Claim new market space via differentiated strategy
Actually bloody do something different that gives you hard competitive advantage, at least for a while. Put your flag in the ground of that new space. Declare it as your own. And for a while at least, occupy it unchallenged by any real competition as they try to catch up.
Step 2 – Create single-minded branding laser focused on that offer
Get your aesthetics, your messaging, all of your “presentational” stuff precisely aligned with the unique value you’re putting out there. Don’t allow it to be diluted or diffuse. Make sure it is about one thing – the thing.
Step 3 – Aggressively double-down on activities around that market space
Continue to innovate to drive ever deeper into the value territory. These are “stretch innovations”; things which aren’t strictly necessary to deliver on the unique value, but which take it to new levels of expression. E.g. Porsche don’t need to put lap timers in their sports cars, but they do, because it’s a joyful expression of what they’re all about.
–
By the time you’ve done this, it won’t matter what your competitors do, because you will be seen as “that thing”, and people who want it for the most part won’t bother with researching the competition.
That is brand.
This also shows us what “bad branding” is as well.
Bad branding is simply what happens when a company does stuff to erode its hard earned position. When it loosens its grip. Like when The Gap changed their logo, or when Bud Light did their Dylan Mulvaney partnership.
Almost always these missteps are well-meaning attempts to “expand” the brand; to make it more relevant to more people. But “expansion” is often the same as “dilution” or “confusion”, and so has to be done extremely artfully, because if you lose that space in your customer’s head, you’re dead.
Conversely, if a brand has no strong market reputation, then it can’t really be guilty of “bad branding” because it has no brand in the first place!
Bad design and messaging, sure. But bad branding? No.
Now I know I’ve used a bunch of high profile B2C brands here in order to illustrate the point, but yes, the same thing applies to B2B too.
I will admit that B2B brands have quite a bit more wiggle room than B2C ones, partly because their brand positions tend to be less emotive (i.e. people don’t really care), and partly because most of them are so unknown that they have no reputation one way or another.
But ultimately the core challenge is the same: they need to build that reputation.
They will only do that by strategic action.
And until then, they’ve no right to talk about branding at all.
