3.102014

business growth through brand focus

My new Harvard Business Review post, What Shake Shack Knows About Growth that McDonald’s Has Forgotten, explains that if your single focus is not grounded in your brand identity, your business will not likely experience sustainable growth.  It’s a bold argument, I know, and I’m sure strong cases against it can be made — but in my 25+years of working with brands, I’ve found that brand focus is the most effective driver of business growth.  Other approaches to focus fall short.AA041683

Technology-focused organizations by definition operate from the inside out.  They start with a new technological capability and then consider what products to make and how to get customers to buy them.  Their aspiration to be first-to-market inhibits the discipline to walk away from new technologies after yellow flags have gone up regarding feasibility, profitability, or fit with strategy or customers. And even if they manage to launch a successful breakthrough, the success of technology-focused organizations is short-lived since it is so difficult it is to sustain a technological advantage today.

Sales-focused organizations are primarily concerned with revenue growth which means they seek customers by the numbers and often use price concessions to make sales.  Success is claimed when a sale is closed and less importance is placed on whether or not the company actually delivers the value the customer really wanted.   Ultimately this focus on sales fails to deliver a profitable market leadership position because such companies don’t build strong enough value perceptions to generate adequate margins and customer loyalty.

Companies have been right to give more power to marketing in recent years, but marketing-focused organizations create their own pathology.  The effectiveness of many marketing departments is often limited by territorialism or organizational barriers.   When the understanding of customers, the development of value propositions, and the application of brand values are considered responsibilities of the organization’s marketers only, companies lack the alignment and integration needed to produce a complete and coordinated superior customer experience.

Customer-focused organizations are embracing a concept that’s  popular now, but the customer as the focus of the organization  runs up against the reality that it is neither financially nor operationally  feasible for a scaled enterprise to satisfy all desires of all  customers. Companies that try to serve all the different requirements of their user bases end up with a form of organizational attention deficit disorder that burns resources and fails to connect meaningfully with any customer.

The problem with each of these approaches of focus is that none of them actually define what your company is and what your company stands for.  They are merely the means for executing and expressing your core, your essence – in other words, your brand.

Great brands use their brand identities as their one true focus because that’s the only way to ensure continued relevance and resonance with customers — and continued value to shareholders.  Please give my HBR piece a read and let me know what you think.

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