Why is branding important for small businesses?

The word “brand” in itself sounds a bit grand and thus intimidates several people. This word comes with a perception of a pan nation identity and huge capital investment. 

Thus, small businesses often overlook branding, as it seems both unattainable and unnecessary. 

However, contrary to this popular perception, branding is essential even for small businesses. Also, it is achievable today without major capital investment. This has become possible with the advent of social media marketing and digital platforms. 

There are a host of benefits related to branding. But it is essential to first have a substantial understanding of the term ‘branding’.   

So, here’s a complete explainer on branding and what it does for your business. Read till the end to know whether you should try building a brand for your business or not.   

Table of Contents

1. What is a brand? 

2. Improves recognition

3. Creates trust

4. Supports Marketing Initiatives

5. Builds financial value

6. Inspires employees

7. Generates new customers

What is a brand? 

A brand, in the most simple words, is a perception of a product, service, company, or individual in the minds of those who experience it. 

It is much more than just a name or logo, it is more of an abstract concept. 

You can think of any major brand you like. On close observation, you would notice that their products do not define their whole identity. Rather, you will find it more related to the feelings associated with their products. 

Thus, the name, logo, marketing efforts, products, or any other element, doesn’t constitute a brand alone. It is therefore more of an intangible experience that lives in the minds of people.   

Following is a list of things branding can do for your business. 

1. Improves Recognition

A logo is one of the key components of a brand. It is practically the face of any business as it is what people instantly recognize. 

A good, professional logo is both simple and powerful simultaneously. The simplicity makes it memorable for people, while it needs to be powerful to leave the desired impression. 

You must be able to make every person think and feel exactly the way you want them to. 

2. Creates Trust

Presenting yourself in a professional manner initiates a sense of trust among the prospects. 

Add to that, some social proof of the quality of your products and services, and your target audience will become more likely to purchase from you. 

3. Supports Marketing Initiatives

Marketing is an essential component of a brand. The medium you choose and the demographic you target, both collaborate to build your brand. 

But choosing the right audience is a tricky task. Too narrow a focus and you might lose your opportunity to expand into newer markets. However, broadening your marketing focus too much could hamper your ability to create a strong and definitive impression of your brand.  

4. Builds Financial Value

Companies listed on the stock market are often valued several times more than the actual value of their combined assets. 

Much of this value can be attributed to the branding of the company and the resulting brand perception and value. A strong brand, thus, often promises future business.

Being perceived as valuable is always beneficial for a business, be it for borrowing funds for expansion or rolling out an IPO. 

Thus, dedication towards building a brand value pays off in the form of financial return. 

5. Inspires Employees

Very often employees need more than just assigned tasks. They need something they can work towards, a shared vision and goal. 

If the employees understand the core principle and mission of the company, they are likely to feel motivated. They would feel a sense of pride and unification that would help them work together towards the common goal. 

Thus, building a strong brand will help you turn the company logo into a symbol of inspiration for your team.  

6. Generates New Customers

As a business, what you ultimately need is customers. Branding, along with all the above-mentioned benefits, can also help you earn customers.

Branding can get word-of-mouth referrals for your business. Stating the obvious again, your logo, marketing, and reputation need to work coherently to achieve this. 

It is simple if someone has to recommend your brand, he/she needs to remember it. So, be memorable. 

Conclusion

So, branding has a lot to offer for your business. You just need to do it the right way. 

Firstly, you need to design a logo that is both easy to remember and impactful. Then, you need to present your business in a professional manner. 

Once you start building trust with your potential customers, make sure you target the right demographic. 

If you perform these steps correctly, you will not only get more business and build financial value but also inspire your employees with your brand. Read more information.