Company value and your brand
A person’s opinion of a brand is like an emotional bank account with a balance that fluctuates up and down. Every positive experience we have with a company/brand is like making a deposit in the account, while every negative interaction is like a withdrawal. These transactions can include human elements, like meeting a sales person, as well as non-human aspects like using a product, visiting the company’s website or interacting with an auto-attendant phone system. Brand opinion can also be influenced by stories we hear from others. The balance at any given time links directly to future action – brand loyalty, repeat purchases and how people promote the brand.
Brand value is an intangible asset for a company which can be difficult to account for using traditional accounting methods. Notionally, it is the number of people times the average balance in their opinion bank accounts at any given time.
That’s not to say that we can’t put a value on brands. When companies are bought and sold, the goodwill amount (the amount a buyer pays over the value of tangible assets) represents the value of intangible assets like brand value. Further, organizations like Interbrand estimate and rank the value of leading global brands every year, with brands like Coca Cola and Apple ranking near the top with values in the billions of dollars.
Improving brand value through experience
Jan Carlzon demonstrated the link between company performance to experiences customers have with a brand. He called these experiences Moments of Truth and explained his perspective in his book of the same name. As CEO of Scandinavian Airlines (SAS), and he focussed on defining all the discrete moments of truth customers were having in interacting with the company. These included booking tickets, waiting in security lines, being greeted at the plane, the safety demonstration, and dozens of other interactions travellers would have on each trip.
Carlzon then set upon incrementally improving each one of these elements by pushing authority down to the front lines and making each interaction positive and memorable – many small deposits in the brand bank accounts of each customer.
During his tenure in the 1980s, Carlzon turned the company from a losing venture to a highly profitable company, and one of the most respected airlines in the world.
OK, where do I start?
The starting point for any company improving their moments of truth is to first define or map all of the interaction points with prospects and customers. For example, this illustration shows a typical customer experience for someone interacting with Starbucks:
This type of illustration shows the ‘as is’ process and the very exercise of creating a map like this can immediately illustrate pinch points or other areas of potential dissatisfaction.
From this starting point, process analysis and improvement can occur to define new and better ‘to be’ processes. We defined how to do this in a previous article.
Every interaction matters
In many organizations, the least experienced and knowledgeable staff are on the front lines and execute the most moments of truth with prospects and customers. Leading organizations understand this, and invest appropriately in training and empowerment of staff members at these levels..
As well, successful organizations understand all the touchpoints, and continually look for opportunities to improve. One of the benefits of well trained and empowered front-line workers is that they can identify important areas that are negatively impacting customers, and suggest ways to make it better.
Is your organization making more and bigger deposits than withdrawals?