In this article, we’ll explore 4 key steps that should be integrated into your brand strategy to ensure long-term success and sustainable growth, along with actionable recommendations for each.
Brand Strategy Step 1:
The 95:5 Rule
Professor John Dawes of the Ehrenberg Bass Institute introduced the concept of the 95:5 rule, which emphasises the need to balance short-term conversion efforts with long-term brand building. This rule highlights that, on average and depending on the category, 95% of potential buyers are not currently purchasing your product or service. A common mistake businesses make is allocating too many resources to convert the 5% of immediate buyers, neglecting the long-term recruitment of future customers.
Recommendation for Action:
Allocate your budget strategically by focusing not only on immediate conversion but also on long-term brand building. There has been much work done by Binet & Field, most notably in their paper, ‘The Long and the Short of it’ to suggest that approximately 60% of the budget should be allocated to the Long and 40% allocated to the Short. This varies depending on a number of factors, including the category and the maturity of the brand, but if you start from the position of allocating 50:50, you can’t go far wrong.
Brand Strategy Step 2:
Mental Availability
Mental Availability is a concept that focuses on making your brand easy to recall in buying situations, both now and in the future. As you build Physical Availability, most likely through wider distribution, it is critical that you support that expansion with the right level of marketing investment. It is not unusual for brands to achieve their first phase of growth with low levels of advertising spend, but ultimately, investing in longer term brand building will need to be a key part of your growth strategy.
Recommendation for Action:
As part of your longer-term strategy, ring-fence an appropriate level of investment for building Mental Availability.
This could be between 7% and 15% of your Net Sales Revenue. Ideally, within that budget, you will protect 80% for advertising and spend no more than 20% on what is called non-working spend, for example, fees.
Brand Strategy Step 3:
The importance of Category Entry Points (CEPs)
Category Entry Points, or CEPs, are the retrieval cues that buyers use when thinking about a particular category. Understanding the most important CEPs in your industry is crucial. Your brand strategy should focus on aligning your proposition with these cues and then crafting messaging around them.
Knowing the Category Entry Points
Recommendation for Action:
Invest in building wider fresher networks by developing brand associations with the CEPs you have targeted.
Brand Strategy Step 4:
Distinctive Assets
Distinctive assets are the visual and sonic cues that help consumers remember your brand. These assets are a fundamental aspect of Mental Availability, as they aid memory retrieval.
Recommendation for Action:
Invest in the creation and consistent use of distinctive assets that make your brand memorable. Ensure that these assets, whether visual (like logos or colours) or sonic (like jingles), are consistently incorporated into your marketing materials and communications. These assets will become synonymous with your brand and aid in its recognition and recall by category buyers.
Conclusion
Building a successful brand requires a well-structured and comprehensive brand strategy, accompanied by actionable steps. By incorporating the principles of the 95:5 rule, Mental Availability, Category Entry Points, and Distinctive Assets into your plan, and following the respective recommendations for action, you can set your brand on a path to long-term growth.
Recommended Video:
Take a look at our video for a more in-depth analysis of some of the above steps.
Recommended Reading
Take a read of Jenni Romaniuk’s Book: Better Brand Health or the brilliant and probably most important marketing book: Byron Sharp’s How Brands Grow.
Connect with us here on our LinkedIn page or you can connect with Martin or Mark directly.
