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Stocks are falling, tech growth is stalling, and bubbles are bursting. If you haven’t heard it yet, you’re bracing yourself for the impact. When markets begin to change, companies are forced to pivot and adapt quickly to minimize the downside. In tech, we’re seeing this play out in the form of budget cuts, mass layoffs, and hiring freezes.
It cannot be denied that some of these reactions are justified, if unfortunate. A more than 10-year economic boom gave way to inflated growth trajectories, overvalued startups and unprecedented hiring. But the wake of casualties that remains as a result offers a strange glimpse behind the curtain. When the going gets tough, how do priorities change? Who or who is the first to arrive at the counter? Do these cuts align with the company’s stated goals and vision, or are they just a Band-Aid designed to ease the fears of anxious investors?
Related: 4 Simple Techniques to Successfully Brand Your Business During a Crisis
A long-term mindset brings long-term rewards
In 1997, Amazon’s initial public offering was launched at a price of $18 per share. Two years later, the company’s valuation soared to more than 50 times its IPO value. Then the dot-com bubble burst and a stock that had once soared above $100 fell to less than $10. It wasn’t until late 2001 that Amazon began returning profits to investors. Today, it is the fifth most valuable company in the world with a market capitalization of $1.1 trillion.
How did the company survive while so many others failed? To the dismay of investors, Amazon took a slow and steady approach, focusing more on brand recognition and innovation than revenue.
In a 60 minutes In an interview, Amazon CEO Jeff Bezos explained this strategy, saying, “The long-term focus is rare enough that it means you’re not competing with a lot of companies because most companies want to see a return of the investment, you know, one, two, three years… I’m ready for it to be five, six, seven years. So just that change in the timeline can be a very big competitive advantage.”
Similarly, online travel booking website Priceline lost $1.1 billion in the dot-com crash. Instead of cutting back on brand marketing, the company doubled down. You probably still remember the TV commercials with William Shatner as the “Price Line Negotiator,” a campaign so successful that it ran for the next 14 years. The company never took its foot off the gas, spending $3.8 billion on marketing by 2021. Today, Priceline’s umbrella company, Booking Holdings, has a market cap of $78 billion.
Related: How I turned a crisis into a brand-defining moment
The ROI of brand value in times of crisis
It’s tempting to focus on short-term solutions during periods of volatility. Start digging into the numbers, looking for areas that give you the highest return. Brand value is rarely shown as a line item, because brands are built over years, not quarters. But focusing on building your brand value is just as crucial in times of crisis as it is in times of stability. Trends change, customer needs change, but who you are remains constant, and that fairness pays off in tough times.
Your brand is your most valuable asset. It’s who you are, why you exist, and how you deliver on that promise. It’s not your colors, pet or product. Instead, it’s how people feel when they interact with your business at any given touchpoint. You should be able to describe a brand in the same way you describe an individual. Are they progressive and principled? Feminine and fierce? Empowering and authentic? The right brand identity, cultivated, nurtured and ingrained in the minds of your audience, can deliver lasting results.
For example, during a time when budgets are shrinking, a strong brand will continue to offer:
word of mouth: 91% of B2B buyers are influenced by word of mouth when making purchasing decisions, making it more influential than Google, Facebook and Twitter combined. What drives word of mouth? Brands that inspire emotional intensity receive 3x more word-of-mouth marketing than brands that are less emotionally connected.
Loyalty and retention: Retention is significantly less expensive than acquisition. When customers feel connected to your brand, a part of your journey, they’re more likely to weather storms by your side. For more on this, just look at Nike.
trust: According to a 2022 Salsify survey, 46% of consumers say they would pay more to buy from brands they can trust. Especially when times are tough, people look to brands they feel they can trust.
income: Consistent brand presentation across all touchpoints has the potential to increase revenue by 33%.
Related: 6 Recession-Proof Business Marketing Strategies
If you build it, they will come
Above all, people buy from brands they believe in. As Simon Sinek once said, “People don’t buy what you do; they buy why you do it, and what you do simply demonstrates what you believe.”
Your brand identity is the expression of that “why.” It’s the driving force behind your behavior, your voice, and the feeling that’s left behind after every interaction with your organization. Investing in and cultivating a strong brand will be the defining factor in how your organization weathers both the good and the bad.
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