I must say I had a lot of fun researching for this article and writing it, and I hope you'll enjoy reading it too. So let me tell you a story about two small-town burger joints that started on equal footing but took very different paths.
You see, both Lou's Burgers and Burger Den (don't bother Googling their names, I changed them ;-) opened their doors in the Midwest five years ago; both were family-owned and operated, both boasting quality burgers and fries, and both invested roughly $5,000 on marketing during their first year in business.
Craft a unique vision.
But by year two, Lou's Burgers decided to wake up to their entrepreneurial purpose and invest in crafting a consistent, unique vision that stood for something unforgettable. They were determined to understand what their unique vision of the burger experience was, what they really should stand for in the mind of their customers, to connect deeper with their community, and to make a difference, one burger at a time.
Shake your industry.
So, they partnered with a branding agency and invested $15,000 to develop a strategy and an identity that spoke to their mission, values, and aspirations. They first spent time developing a strategy platform, positioning, values and brand story. No design, just thinking. Deep.
Then they went on to create a logo, flagship color, packaging, store, furniture, recipes, and service concept, and a message that shook the industry and resonated with their audience from the get-go. They then used that branding across all their marketing efforts, from their in-store signage to their menus and advertising and social media.
Meanwhile, Burger Den carried on with their day-to-day business, standard marketing and discount strategies, and generic messaging about burgers and fries, while neglecting the power of a clear purpose and unique experience. They were not as impactful or consistent as Lou's Burgers, and their customer retention rates took a nosedive to around 30%. Oops...
Take the journey.
By year three, Lou's Burgers continued on their journey, staying true to what they stood for and investing another $10,000 on their marketing campaigns. And you know what happened? Their customer retention rate jumped up to 40%! Meanwhile, Burger Den carried on with their same marketing strategies from year two and saw a steady revenue of $300,000, but with a lower gross margin of $180,000.
Carry on, my wayward son
But here's where things get interesting. In year four, Lou's Burgers stayed the course and invested another $20,000 into their branding and marketing efforts. They even opened up a second location in a neighboring town and expanded their reach.
Their revenue skyrocketed to $500,000, with a gross margin of $325,000 – a gross margin percentage of 65%. In contrast, Burger Den again chose to stay qualitative but generic and saw a slight drop in revenue to $275,000, with a gross margin of $165,000, or a gross margin percentage of 60%.
Finally, in year five, Lou's Burgers secured several partnerships with other local businesses and hit a revenue of $700,000, with a gross margin of $455,000, or a gross margin percentage of 65%. Meanwhile, Burger Den remained stagnant in their ways and saw a decline in revenue to $250,000, with a gross margin of $145,000, or a gross margin percentage of 58%.
"Here's to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes. The ones who see things differently. They're not fond of rules. And they have no respect for the status quo. You can quote them, disagree with them, glorify or vilify them. About the only thing you can't do is ignore them. Because they change things. They push the human race forward. And while some may see them as the crazy ones, we see genius. Because the people who are crazy enough to think they can change the world, are the ones who do." – Steve Jobs
What's the moral of the story?
The moral of the story is not about branding. It is about entrepreneurship and being daring enough to stand for something unique and memorable. The moral of the story is that as an entrepreneur, you should not let cognitive biases and misconceptions, let alone your comfort zone, hold you back from awakening your entrepreneurial purpose and investing in a vision that shakes the industry.
By investing in crafting a unique, authentic identity – which will then translate into a unique brand experience – that embodies what you stand for and that connects with your customers on a deeper level, you can see a direct impact on your business's revenue and profitability.
I know that branding seems to be something that only big companies need to worry about. I know that prioritizing brand building seems counterintuitive when you're faced with the day-to-day business activities, and when you see all your competitors doing the same thing and playing by the same rules. It's easy to think that these are the rules of the market you have to abide to. However, in psychological terms, these things are called environmental limiting beliefs. They're not our friends.
Actually, it doesn't work that way. It's "just" a confirmation bias trap – this tendency we all have to seek out information that confirms preexisting beliefs and ignore information that contradicts them. And it will keep you stuck in the same rut as everyone else in your industry forever, until you step out of the generic game and create your own.
This is what real brand strategy is: the creation, affirmation and implementation of your own rules. Your mission as an entrepreneur is to disrupt the game, find and trust in your purpose, and consider the tangible benefits of a business strategy that moves away from the standard, gets noticed and speaks to your customers' hearts.
It will feel uncomfortable at first.
And it's a very good sign. Because before you can shake your industry, you will have to shake yourself. And just like we all do with something that is either ambitious or not familiar, or both, you will need guidance and a sparring partner – although there are many things you can do yourself.
And that's what a good branding advisor is supposed to do for you: to help you articulate your own vision in tangible terms, to reveal what is specific and unique about your entrepreneur spirit, deliver advice tailored to your industry, target audience, and resources, to develop a concept, a vision, and a brand strategy that truly works for your own business, and an implementation pace that you can afford.
So, wake up to your entrepreneurial purpose, craft and stand for a unique idea of what burgers are, and make a difference, one burger at a time. And if you're not selling burgers, do it one product and one service at a time anyway, because branding works for every industry – and even for individuals.
Maybe right now you can't really figure out what a difference it will make, and this is normal. But as you step on the way, it will unfold and I can promise it will ultimately be more than worth it.
Sources:
National Restaurant Association. (2019). 2019 State of the Restaurant Industry Report. Retrieved from https://www.restaurant.org/research/state-of-the-industry
Small Business Administration. (n.d.) Financial Statements for Small Business. Retrieved from https://www.sba.gov/business-guide/plan-your-business/prepare-financial-statements