Reilly Newman | A common question from founders, executives, and alike is “What’s the ROI (return on investment) of brand?” Now, if a consultant or marketer has ever given you a clear, simple answer to this question, they lied. Anyone who has been in the world of brand for a while can attest that the only honest answer is: “it depends…”
I once answered this typical “ROI” question during a podcast interview with a question – “What’s the return on your relationship with your spouse or children?”… (*pause*) Do we spend loads of time, energy, money, and love on these significant individuals, yet expect no return? You see, the relationship is the return. There isn’t some auxiliary byproduct being spun off as the “return” from the investment. The return on investment is the relationship.
→ Listen to the Brand ROI episode on Brandy Podcast: Link
Return on Relationship
As I gave my pithy remark during the interview, the thought just seemed to be one that was always on my mind throughout the years, yet never expressed. Finally, articulated through words, it clicked even more and how it connected naturally to brand.
Following this line of logic, we can apply it to the “easily-accessible” question of brand’s ROI. I say this because this question is often used more as a space filler than one of true inquisition — albeit it’s not their fault; they’ve been conditioned by KPI’s (key performance indicators) and graphs that have commandeered marketing thanks to digital ads.
Let’s start by referencing a common term we use: “Business is transactional. Brand is relational.”
As dangerously simple as this is, I still believe it holds up in the complex world of business. Occam’s razor suggests that sometimes the simplest answer is the best answer.
If we agree that brand is relational, this brings us back to the relational investments we make with our loved ones. There’s no return other than the relationship. We spend quality time, buy gifts, and play nice to be returned to the very thing we are creating — the relationship. Similarly, brand is the return as we simultaneously build it.
The investments you make through design, messaging, processes, technology, packaging, ingredients, materials, training, and more should all work in lockstep according to the strategy. These investments in shaping the perception of the company in the marketplace result in the relationship (AKA brand)
Relationship No Matter What
As we’ve written about in “Brandy: 101 Sips of Wisdom for Attaining a Successful Brand” your business has a brand whether you like it or not — this principle still applies.
Going back to our relationship example, a father will have a relationship with his kids whether he likes it or not. Even if he abandoned them before they knew him, their relational perception of him will still exist. Although it’s a tiny sliver and most likely a negative association, it’s still a relationship. On the other hand, a father who makes time for his kids and invests in their activities builds a healthy relationship (good job Dad). It doesn’t matter if there is a relationship or not, but how much or little there is.
Even when an estranged family member has “no relationship” to the family, there is still a relation to the individual, which further fuels the perception. Our efforts and investment are what will determine the health of the relationship. And yes, your business is in the same boat.
The ROI of Brand
When we consider this, we see that brand isn’t an investment, but it is the investment. As you think about the ROI of your brand, frame it relationally. Yes, it is an investment where you will pour time, resources, and energy into, but don’t expect a payout as a byproduct. This type of investment is the return. It benefits all other aspects of your business. It relationally interacts so your business can transact.
