By Maria Young
As a Controller it’s in my nature to measure the effect of investments on a company’s bottom line. In an era where we’re pushed to do more with less I’ve witnessed many breweries make great strides with slim resources, especially in the start-up phase. Central to these efforts is the judicious choice to spend money on goods or services that will continuously return their investment. One of the most important, but often overlooked, expenses a brewery can leverage is its brand.
What is a Brand?
Brand is a term used to describe the various ways that a company communicates its identity to the world at large (logos, web design, tone of communications). Unlike fixed assets, brand doesn’t depreciate, or lose value, over time; it can actually increase value. Consider the brand value of your favorite craft beer. Simply seeing the logo evokes good feelings, a perception of quality, and expectation of what you’ll experience when you open a bottle. Now consider the public’s experience when faced with innumerable beer choices in the supermarket aisle. Your brand is crucial for differentiating yourself in a crowded market, no pun intended.
Marketing Doesn’t Suck
Marketing expenses are often viewed as a resource suck. As a line item that seemingly generates no revenue, brewery owners are often hesitant to spend money on it. The reality of today’s increasingly crowded market requires owners to shift their view of brand from an expense to an investment.
Once you have invested in a brand, leverage it! Use it at every available opportunity. Studies show that the visual impact to an audience of a logo is much more effective than written words. Put your mark on all collateral – envelopes, invoices, even email signatures. Envision the consistency and cohesiveness your brain will have when every touchpoint includes your messaging mark. Distill your brand’s essence into one image and a short phrase, and use it at every opportunity. Consider how your brand is used, and ask yourself if your company is realizing its best use.
Brand on the Run
Naturally, a company will become more recognizable the more frequently an audience is exposed to its brand. After taking effort to craft an image, companies have a powerful tool that, with thoughtful leverage, can return its investment time and again. Perhaps the most prescient example of brand value at work relates to distributor negotiations. A beer’s brand is factored as distributors consider which lines to add to their portfolio and how much they will pay for them. A strong brand on the rise will demand a greater price. It’s possible a brewery’s Income Statement will belie the full value just waiting to take center stage. Savvy brewers and distributors alike will acknowledge that a potential (which is fueled by the brand) can be a game changer. Distributors may court and offer a greater financial incentive to breweries on the rise. Work with your Controller to establish systems to track of the success of your brand, assigning values when possible. Use this information to measure financial ROI and negotiate very tangible rewards. A great brand is a powerful vehicle, but to realize full future returns you must understand the value it creates and use it wisely.