In the age of information, will the role of a brand have the
same power over consumers?
That question plagued hypothesizing marketers for a while,
with some guessing that consumers would leverage the availability of so much
data to find the ideal product regardless of brand affinity. Others suspected
the information would be so overwhelming that consumers would naturally revert
to known brands. And surely anyone could pluck a case study that supported one
point over another.
Or we could just take a look at the numbers: Data from over
6,000 mergers and acquisitions between 2003 and 2013 that shows us valuation
trends over the decade.
Data from the Markables
database shows the dollar valuation of a company’s assets, which include the
trademarks and customer relationships—an ideal data set to provide answers for those
hypothesizing marketers. An analysis
by the Harvard Business Review showed that over ten years the trend lines are
clear: brand valuations declined while customer relationship values rose.
So it’s less about whether customers can or will sift
through information to make (or not make) decisions about brand purchases—it’s
about whether or not you have a relationship with them. That relationship is
quite literally more valuable than your brand.
Luckily, marketing technology now allows brands to optimize
the consumer’s journey and leverage effective communications. Preference
management, the active collection, maintenance and
distribution of unique consumer characteristics, such as product interest,
communication channel preference and frequency of communication is the best way
to engage with customers and ensure that they are leading that relationship on
their own terms. When they have an affinity for the brand, it’s due to their
personal relationship with it, not necessarily the research and development
behind the product.
Think about how your company would be
valued—are relationships with your clients worth double your brand? Investing
in those relationships now has an increased ROI for your company as a whole.
Eric V. Holtzclaw is Chief Strategist of PossibleNOW. He's a researcher, writer, serial entrepreneur and challenger-of-conventional wisdom. His book with Wiley Publishing on consumer behavior - Laddering: Unlocking the Potential of Consumer Behavior - hit bookstores last summer. Eric helps strategically guide companies with the implementation of enterprise-wide preference management solutions.
Labels: brand value, customer relationship, customer value, enterprise value, eric holtzclaw, Harvard business review, marketables, marketing technology, preference management