Michelle Rodger: A brand new approach can beat recession

Published on 28/02/2009 13:21

OKAY, so cash flow is tighter than ever before, existing customers are taking longer to pay, new customers are thin on the ground and your business needs an injection of entrepreneurial Viagra to ensure it stands up firmly against the competition. What do you do?

It's simple. Rebrand. Choose a new logo. Change the company name to the better one you thought of immediately after registering your current one with Companies House. Order new stationery, buy new brochures and business cards. Oh, and hire a designer to revamp your website.

Don't believe me? Well according to a recent report business leaders across the UK believe rebranding is the key to recovery, a way of weathering the recession.

The survey was carried out by a branding consultancy. The Principle Group questioned 250 marketing directors of blue chip companies and UK business owners, and discovered that successful rebranding is seen by 64% of UK business leaders as a route to gaining "a competitive edge in a downturn". Some 63% agree that a new identity signified "a bold embracing of change", and 56% of marketing directors of blue chip companies believe that a downturn could be the best time strategically to rebrand. And 85% believe that design will play an important role in generating a recovery for some, or all, brands.

Oh really. Royal Bank of Scotland is one of the world's biggest brands, yet the current perception of RBS in the marketplace is certainly not the one the marketing department intended when they parted with millions of pounds to promote the bank's brand on a global stage. Do we think a nice new logo – paid for by the taxpayer, of course – will fix the RBS brand?

The survey has prompted much discussion among those marketing luvvies not asked for their views in the survey. They say a new look should signify deeper, more fundamental change within the organisation, and believe that repositioning while retaining the company's core values, as opposed to rebranding, is the key.

But they're all wrong. Survival in a recession goes much deeper than superficial logos and inanely bland mission and vision statements.

To succeed, employees must come first, customers second. It's my golden rule. If you don't look after your employees, who will look after the customers?

Leveraged correctly, a strong, powerful brand can build staff loyalty, influence behaviours and attitudes, and improve both motivation and productivity.

I don't mean that you should bully your staff into being loyal to the company a la Panasonic, which turned to its employees for unusual help when sales started to plummet. The company introduced a policy of ordering every member of staff to go out and buy 1,000 of Panasonic products.

This approach is set, disappointingly, to become a precedent in Japan, with many organisations expected to follow suit by either commanding or pressuring employees to divert part of their salaries toward supporting the sales effort of their bosses.

Toyota already has a "voluntary" scheme in which 2,200 of its top tier of management decided to buy new Toyota cars. And the president of Fujitsu apparently emailed 100,000 employees to suggest it would be nice if "employee ownership rates" of company PCs and mobile phones were a little higher.

It's a knee-jerk reaction that could backfire, with previously loyal consumers turned off by such a heavy-handed approach. It's also too little too late. If your product/service/business is good enough, and your employees are already loyal to you then they would be regularly buying the brand through choice rather than by instruction.

Communications consultant Julie Moulsdale, of Perceptive Partners, finds it "staggering" that companies spend millions of pounds on external branding, telling all who will listen that their people are the most important asset the company has yet they don't spend anything like the same amount they do on internal communications as they do on consumer communications.

Director Moulsdale says that approach underlines how few companies actually truly value their staff. It's an opportunity missed, she warns. To have your own people as brand ambassadors is a "no-brainer". It costs less, and it's a fact that word of mouth is the most cost-effective way to generate new business in the SME sector.

We all know that a strong brand facilitates cross-selling and market entry, that it aids communication with the city and encourages client loyalty. A strong brand ensures that customers are more forgiving, more likely to promote your brand to others, and are more likely to consider buying new products and services from your business.

But when customers aren't buying, or are buying less, and are seeking better price and service deals from your competition, it's your employees that are central to the new recession-beating marketing mix.