Manelik
- 3 min read

Brand equity is key, but why is branding so damn expensive?

As a business owner or executive, you may have often wondered why branding costs so much. But what if we told you that professional branding is not an expense, but a long-term investment with measurable financial benefits?

Because spoiler alert, compared to the value it brings, branding is not expensive. Am I saying it in my own interest? Actually not, I'm saying it in your interest. Because nothing you can ever do will have more overall impact on your business than branding.

Still need to be convinced? Let's explore how branding impacts your bottom line and why it is essential to consider branding as a strategic financial move, rather than a short-term expense.

Brand Equity: The key to sustainable growth.

Investing in your brand equity is an investment in sustainable growth. Strong brand equity has been linked to higher profit margins, as customers are willing to pay more for a brand they trust. A strong brand provides a buffer against price competition, enabling you to charge a premium for your services.

Fundraising and valuation: The power of a strong brand.

A strong brand is an asset that investors take seriously. Companies with a strong brand attract investors up to 50% faster and raise 30% more on average. Additionally, a strong brand can increase a company's valuation by up to 20%. An investment in branding can pay dividends when it comes to fundraising and company valuation.

Profit margins and customer loyalty: The connection to strong branding.

A strong brand leads to higher profit margins. Consumers are willing to pay more for a brand they trust. Loyal customers are more likely to recommend your brand to others, resulting in higher revenues. Increasing customer loyalty rates by 5% can increase profits by up to 95%.

Customer self-selection and cross-selling: Key drivers of revenue.

Well-crafted branding can help your business to self-select customers, leading to higher conversion rates. Similarly, a unified brand experience can enable cross-selling, leading to increased revenues per customer.

Marketing costs and branding: Minimizing expenses.

Strong branding increases your brand awareness and reduces your customer acquisition costs. A strong brand also enables you to achieve more significant reach within your market, reducing the need for costly outreach efforts.

Talent acquisition: Branding's growing impact.

A strong brand can help attract and retain top talent, reducing talent acquisition and onboarding costs. Employees prefer to associate themselves with brands they believe in, leading to higher employee engagement and job satisfaction.

Your most annoying competitor is investing in branding: Are you?

Not investing in branding can lead to lost market share, missed opportunities, and weaker investor traction. Perception matters, and a strong brand can help you differentiate yourself in a crowded market.

"Branding demands commitment; commitment to continual re-invention; striking chords with people to stir their emotions; and commitment to imagination. It is easy to be cynical about such things, much harder to be successful." - Sir Richard Branson

The value of long-term investment in branding.

Professional branding is a long-term investment that will pay back in spades over time. Investing in branding can lead to higher profit margins, higher revenues, and higher valuations. The benefits of branding are measurable and can lead to significant returns over the long term.

If you are not investing in branding – and here I just want to make it clear that a pretty logo won't cut it – you are missing out on a significant opportunity for sustainable growth. Don't let your competitors outshine you – invest in your brand today, because your company is nothing more than a brand in the mind of your customers.