February 2016
Branding - An Investment or Expense

Jeffrey Spear - President, Studio Spear

Jeff Spear

A large number of business executives view branding as a business expense. While it takes an outflow of dollars to pursue, and the expenses appear on spreadsheets as line item deductions, I recommend viewing branding as an investment.


With investments, you expect some degree of return - an incremental gain over a specified period of time - from your upfront payment. Here are a few things you can do to make sure your branding dollars are, in fact, providing a worthwhile return.

Set a Realistic Budget   Branding budgets can be established several ways. First, take a look at the competitive environment in which you are operating and the levels of brand exposure (voice) your direct competitors are obtaining. If you are going to compete effectively, you’ll need a budget that gives your brand an equal or greater impact (share of voice).

Should you view your business as the “David” that is taking on “Goliath,” I recommend budgets no less than 8-10 percent of your gross revenues. This is especially true for smaller businesses that generate under $2 million per year. Keep in mind that, even at 10%, a branding budget of $200,000 will not buy much, especially when advertising is part of your plan.

Have a Written Plan   Branding will deliver your message to specific audiences in many ways and will provide a variety of results. In order to be sure you reach all the right people (buyers, sales influencers) at just the right time with exactly the right message, you’ll want to prepare in advance, a well-orchestrated schedule of brand building events.

You’ll also want to be sure that everything you need can be produced within the limitations of your budget. Once a plan is in place, you will have effectively “spent” earmarked monies. You’ll also know that your sales efforts will be supported throughout the year by a variety of communication tactics.

Pursue Brand Leadership   Most buyers expect that, when they make a purchase, their money is being well spent. From a branding perspective, and to deliver this assurance, clearly communicating benefits and positioning your brand as the best, most obvious choice - the brand leader - is essential.

The reality is, when buyers recognize your brand and believe it represents optimum value for money, they will become loyal patrons and reward you with frequent purchases.

In short, brand leadership is synonymous with sales leadership.

Set Reasonable Expectations   People often say “You get what you pay for.” Just look at what you get when you pay $50 for a hotel room at Holiday Inn Express compared to a $500 room at the Ritz Carlton. Or a $15,000 Kia compared to a $150,000 Ferrari.

The same holds true in branding. When your annual budget is established based on what you “feel” is appropriate compared to what competitive realities mandate, you’re going to get exactly what you deserve. Make sure that you know what sorts of impact you can expect from any level of spending. Your branding consultant should be helping with this. If not, it’s probably time to change providers, even if that means investing a bit more heavily in creative services.

Track and Evaluate Outcomes   As I’ve mentioned above, knowing what to expect from your branding activities is essential. You’ll also want to make sure your promotions have a clear call to action and that you’ve worked out how to quantify the responses you obtain.

While there are a number of ways to track results, not all will be quantifiable. Results linked to coupon redemption rates, website visits, phone calls received, visitors to a trade show booth, purchases linked to special offers, etc. are all excellent ways to quantify results.

In cases where quantifiable results are not feasible, having anecdotal (subjective) results is helpful. Studio Spear recently implemented a direct mail campaign. While it’s too early to quantify its effect, we have heard back from recipients in ways that have been overwhelmingly positive. Simply knowing that we’ve made a favorable impression is a good start.

It’s important to remember that branding helps you reach and influence a large number of potential buyers. When appropriately planned and implemented, it will communicate what your company/brand has to offer, explain why it’s the best offer, establish and maintain relationships with key audiences and invigorate sales.

From my perspective, it’s that simple... and that worthwhile. If you’d be willing to invest in stocks, bonds or real estate because you’re convinced of a reasonable return on investment, then approach branding as an investment and expect no less in return.


If the time has come to overhaul, update and re-invigorate your brand image, or you'd like to change up your marketing program, please call 904 685 2135 - ask for Jeff Spear. You can also contact Jeff via email: jeff@studiospear.com.

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