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This is Part 2 in a three-part series on raising your prices. This instance covers how to build a great brand, which is a critical way to raise prices and make more money. Read Part 1 here.
Creating a great brand is a sure-fire way of building customer loyalty, gaining more control over your pricing, and introducing stellar products, but how do you get started? Many believe that fancy design, a witty name, and catchy slogans are what brands are about. But it turns out that much of what people think about branding is wrong. Brands are about great customer experiences, consistency, and standing for something that matters to your audience. So let’s correct these fallacies by discussing what makes for a great and consistent customer brand experience.
Let’s start by discussing the fallacies surrounding branding.
It seems evident to most that one would need great design to have a great brand, right?
Wrong. At least in part.
37signals, creators of the incredibly popular Basecamp project management system, do not have great design. Their design is pretty weak in my opinion. For years, the feature-set has been quite limited in comparison to beautiful, feature-rich, and relatively young competitors like Asana (launched in 2018).
However, that hasn’t stopped more than 2,838,046 customers from signing up to use Basecamp. Who’s not in awe of that figure?
But instead of focusing on sexy design, Basecamp initially focused on becoming a member of the audience they wanted to serve, which we discuss in our content marketing series. They created fantastic content via in-depth and outspoken articles regarding their industry on their blog, Signal vs. Noise (now on Medium). That allowed them to launch their first product, Basecamp, to an existing audience, delivering a simple platform, without frills, for people who already loved them.
Basecamp became an industry influencer before selling something. They happily turned people off from their product because they wanted a focused customer base. All of this had nothing to do with graphic design and gave their brand so much more weight than the competition. In fact, according to an interview on GroundUp, last year was their best year ever.
So no, you don’t need great design.
But you do need okay design
Let's be fair. After all, Basecamp was founded in 1999, an era when design was far less critical. Plus they've had two decades to build up their brand and customer base.
That’s not you. The standards have changed a lot over the years. What was once passable is now atrocious in the eyes of site visitors. But that doesn’t mean it needs to be fancy.
For example, our current blog design isn’t fancy at all. It’s an MVP. It’s just barely passable by today’s standards, and that’s okay for now. While we’ll make little improvements over time, we know it doesn’t need to look like Quartz. We see the design isn't nearly as important as the content itself.
And the same goes for your online shop. You just need the basics.
Sure, you don’t want to look like a store from 1999. That would likely turn customers off pretty quickly. However, the design of your online store is far less important than the product your selling.
Yes, ave good design if you can, but don't waste time and money on it obsessively. Having just enough design is fine when it comes to building a great brand.
So, send your branding agency a pink slip already.
Branding may not be about design as much as people think it is, but design thinking plays an incredibly important role in branding. That’s because branding is about designing an incredible experience for your customers.
Seth Godin puts it brilliantly. “Walk through the diamond district in Manhattan and in the course of one block, at least a dozen men will stop you and ask if you're hoping to sell a diamond ring. A few blocks away, Tiffany will happily sell you a diamond ring. Buy a $7,000 ring at Tiffany's and walk over to one of these guys and you'll be lucky to get $1,000 for your new ring. That $6,000 is what you paid for the story. It's the cost of the box, the lighting, the salespeople, the architecture and most of all, the special feeling.”
We can substitute Seth’s word “story” for experience here quite easily, and we have the same meaning. After all, a story is merely the word-of-mouth part of an experience.
The same goes for the Apple Store. Why are Apple Stores so much busier than Authorized Apple Retailers? It’s the experience, of course. People like the layout of the store, the army of friendly and upbeat staff ready to assist, and yes, even the design.
When it comes to your online store, what amazing experiences are you creating for your customers? Try these on for size:
Brand experiences are rendered meaningless if customers can’t rely on them.
Starbucks is famous for this. Most customers go to the same Starbucks location at the same time every day. When they walk in the door, the staff already know these repeat customers' names and orders. Even if a customer has only been to a store a handful of times, the team seems to know who they are and what they want magically. That isn't by accident. Every Starbucks employee is trained to do this. Especially in an environment where people are often anonymous, this delights repeat customers.
What's more, if a new customer comes in, the team ask for their name and write it on the cup. Not only does this make dealing with a high volume of orders a little bit more personal, but it also helps with the customer recognition process outlined above.
They do this every single time.
An experience is an emotional thing. Customers interact with your brand, and if they feel something, that’s an experience. They link the action to the emotion.
Of course, you can't control everybody's emotions, but you can control the experience to a large degree. And creating that consistent experience, which results in a consistent emotional state when customers interact with your brand, is what separates successful brands from unsuccessful ones.
The above example is only a small part of the daily brand experience Starbucks customers expect. Everything they do is a part of the brand experience, from their seasonal menu changes (e.g., the pumpkin spice latte) to the free wifi. All of this weaves a story that customers tell themselves about the type of person they are and the type of business you are. And it all comes from an entire stack of experiences.
And, as always, the same goes for you. Your website, the way your salespeople chat with customers, and the process with which you fulfill orders and delivery deliver them. All of them are a part of your brand experience stack.
There’s a tool in project management, called the project management triangle. The model has evolved, and we'll adapt it for our purposes. We'll call it the brand experience triangle we’ll say the model contends that:
Often, brands try to focus on two constraints, sacrificing one. Sometimes a brand can sacrifice two to gain a ton of points in one. But trying to focus on all three creates a generic brand with no brand promise, which is unknown to the market, which usually leads to bankruptcy.
For example, you could have a very high-quality good that's delivered relatively quickly, but at an incredibly high price for manufacturing and fulfillment (which means higher prices for customers). Alternatively, you can have a very low-quality good that's delivered reasonably quickly, but that's cheap to manufacture and fulfill (meaning lower prices). And of course, there are many combinations beyond that.
Whatever you choose, this is your brand experience.
For example, people who enjoy the brand experience of McDonald's go there because it's cheap and fast, not because it's high quality. People who like a 16-course meal at Michelin Star restaurant don't go for speed and price. They sacrifice both for an incredibly high level of quality.
So, whether you pick quality, time, or price, whatever you choose largely determines the products you produce, the fulfillment experience for your customers, and your customer service practices. Therefore the constraints you pick determine your brand experience and thus your brand identity.
Assuming you’ve found product-market fit, brand confusion sets in when you set out to create an experience based on an incorrect combination of brand experience triangle constraints.
According to Ben Gilbert from Business Insider, in 1996, McDonald's introduced the Arch Deluxe. The new burger was supposed to appeal to "urban sophisticates." It was a sold for a higher price, took longer to make, but the quality was much better than their typical fare. That is in contrast to the low-cost, ready-made, and relatively low-quality burgers McDonald's had been making for decades. The Arch Deluxe ultimately flopped, costing McDonald's $100M in R&D, logistics, and advertising.
Ben added, “Turns out, McDonald's was just around 10 years too early — today, burger chains like Five Guys and Shake Shack are wildly popular upstarts, hawking slightly more expensive fast-food burgers to the modern equivalent of ‘urban sophisticates.’”
What we have here is a case in mistaken identity. People loved McDonald's for the low-price and were fine with the low quality. For them, a higher priced burger was a ripoff. The "urban sophisticates" who wanted more top quality burgers, and could afford a higher price, couldn't imagine themselves going to McDonald's. It was beneath them.
The same goes for you, dear reader. If you’re selling high-end timepieces delivered in a reasonable time frame, don’t introduce something far cheaper with much lower quality. You’ll confuse your existing audience and have zero connection to the audience that does buy affordable watches.
Of course, customer service plays a part in your brand experience. But what does "good customer service" even mean? Does it mean responding to all customer requests within 24 hours? Does it mean having a one-month return policy? What about friendly and knowledgeable customer support staff?
Not good enough.
Everybody expects good customer service. Which means it's the bare minimum, but not enough upon which to build a great brand.
For example, Zappos, an online shoe retailer which was bought by Amazon for $1.2B, is famous for their customer service. There are countless stories of Zappos customer service and sales agents going far beyond the call of duty to make customers love their brand.
Tony Hsieh, CEO of Zappos, recounts a remarkable story in his book, Delivering Happiness.
One night, Hsieh went out for a night on the town with a client, but once at the client’s hotel, they were hungry, craving a bit of pizza. Since the hotel’s room service had finished for the day, Tony suggested that the client call into Zappos to request a pizza.
At 2 AM, a customer service representative cheerfully took the call, found three pizza parlors that were still open near the hotel and made the order for the client. No secret messages from Tony, no mention that he was even there.
That's only one of the thousands of incredible customer service stories from Zappos. And it's worth talking about.
So, no, responding to customer complaints in 24 hours isn’t good enough if you want to build your brand on customer service. You have to do way more.
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It's clear that there are many ways to build a great brand. What you decide to go for is up to you, but you must keep your customers in mind. To find a brand-market fit, you should know the people in your audience intimately. What are they craving more of or less of?
What's more, you have a brand, even if you don't work at it. A brand is merely a reputation. It's what the public and customers think of you. If the market doesn't think about your brand at all, that’s your brand. Even if people hate you, that’s your brand.
Whatever you do, remember that you don't improve your brand by creating slogans or redesigning your logo. You strengthen your brand by enhancing the consistent experiences of customers who buy your products and services. You can be expensive (recommended) or cheap, easy or hard to manufacture, high or low quality. The choice is yours, but whichever you pick, stay consistent.
In Part 3 of this three-part series, we'll discuss pricing tactics that can help you maximize revenue and increase prices without putting off customers.
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