Brand Building in an
Uncertain Economy

Excerpts from this article were published in
the SME Inc section of The Business Times



The cost of branding

One key myth that needs to be debunked, especially in these times of economic uncertainty, is that branding programmes are invariably too costly, long-drawn affairs. Many SMEs that have approach us often cite this as the reason why they remain apprehensive about embarking on such programmes.

"SMEs require branding initiatives that take into account their level of sophistication and resources"

This notion probably stems from interaction with consultants that provide a one-size-fits-all approach. The fact is that branding programmes that are optimally designed for foreign MNCs, for example, may not be optimal for local SMEs – just as marketing strategy adopted by established brands are not always suitable for challenger brands. Local SMEs (and MNCs even) have special needs and peculiarities that require branding initiatives that take into account their level of sophistication and resources. Brand consultants that recognise this would propose customised programmes that can be implemented in phases and varying levels of sophistication. This not only means more affordable programmes for SMEs but also programmes that are more relevant and cost-efficient for SMEs.

Relevance of branding to SMEs, especially under current economic conditions

Given that a key tenet of branding is differentiation, it should be obvious that branding is of particular relevance to SMEs given that more than 100,000 businesses in Singapore fall under this category. With such keen competition, especially under current economic conditions, investment in branding could possibly be the key to keeping ahead of competitors and sustaining profitability. Also, as discussed above, branding programs need not be unaffordable. In fact, not embarking on brand-centric corporate strategy could prove more costly in the long term as opportunities are lost and competition intensifies.

"not embarking on brand-centric corporate strategy could prove more costly in the long term as opportunities are lost and competition intensifies"

Moreover, there is a positive correlation between share of voice and market share. If businesses are able a embark on branding initiatives when market activity from competitors are relatively low, they will be able to gain better leverage from branding campaigns and secure a stronger position in the mind of stakeholders. Judging by the number of enquiries we have received recently, it is clear that SMEs are beginning to realise and act on this.


Leveraging on branding by Singapore SMEs

Acacia has also received increasing enquiries regarding branding related grants by SPRING Singapore and IE Singapore. It is heartening to see that as a result of such funding, more SMEs are seeking to leverage on branding. We have also been seeing a new generation of management take over family businesses. This more brand-savvy generation is also contributing to the trend of increasing leverage on branding. Still, many SMEs do not satisfy the available grants criteria and not all consultants offer branding programmes that are sensitive to the needs of SMEs, and as a result Singapore SMEs are still not leveraging on branding enough.

"the question is never whether you should ‘do’ branding but how well your business leverages on it"

What is more, many SMEs we have met are still vague on what branding is truly about, and worse still some believe it will not add value to their business. So there is still a lot of education required. SMEs (and businesses in general) will need to realise branding is not an ‘extra’. It is a business strategy that complements and is inextricably linked to your corporate strategy and marketing strategy. Because ‘branding’ concerns are automatically in play once you start any kind of business, the question is never whether you should ‘do’ branding but how well your business leverages on it.