As a branding and marketing agency for technology companies, we have seen how most businesses failed. Here are the reasons why brands fail.
7 in 10 businesses fail within 5 years. The reason: Branding.
So simple yet so difficult for most businesses. Why do brands fail is the question the top management of organisations ask themselves. Most businesses realise their company has failed after they give up the firm. During the process, no one really notices that the brand is not doing well. Let’s have a look at the history of branding provided by Marketing91:
In the past, the market was product and manufacture driven. With the increasing industrialisation businesses that had good salespeople were the market leaders. The more the market moved the more the importance of marketing and branding was clear.
Businesses started to point out their uniqueness with their marketing strategies and with that their brand value increased. With the growing value, consumers had more expectations. Whenever a business did not have the right move, it failed.
The main purpose of a brand was to differentiate organisations from other businesses. A tech company, Intel, was the first one to brand its microprocessors and had huge benefits from it. Microsoft beat IBM due to its marketing potentials, Apple beat Microsoft’s brand image by bringing new products and marketing itself as “Innovative”. Products themselves took the backseat and brands sold the products. The right branding allows you to sell an average product. The success of a business heavily depends on branding. However, when a product does not meet the expectations, then people are quick to blame the branding department.
Tata Nano is a good example of this. The car was disliked by many people as for them a car is a luxury and Nano’s looks and performance were not as good as it was branded to be. So when the car failed to be a hit, Tata blamed themselves and said the marketing of the car was not done in the right manner.
A couple of reasons why brands fail:
- The poor product that does not meet the expectations of the audience
- Brand recall value drops: Customers slowly move to another brand because they cannot recall a business’ brand
- Too much expansion with fewer resources: Example Samsung – the company does fairly well and leads in the market however the demand for their cameras and air conditioners has failed
- False marketing: A brand is a promise and if that promise breaks, you don’t have a brand
- Over marketing makes your brand come across as too common
- Your brand might seem irrelevant and one aspect is technology. Having a look at Nokia you can tell it became irrelevant because it did not want to offer the newest technology to its consumers. Android was ahead of the game at that time.
- Increase in competition
- If your service and post-sales customer experience is not good it will affect your brand and might cause it to fail
Another major reason is digital transformation. Many customers gather information online from social media, blogs and so on. B2B businesses have a hard time thriving with their social media presence.
Mistakes B2B businesses make:
#1 Not having a clear strategy
Most B2B businesses use social media because their competition does. They do not have a clear strategy and just try to be active because someone else is doing it too. This approach may seem good in the short term, but in the long run, it never works out. If you post only to be active on socials, how are you able to find out if it is benefitting your business? The way to find out how social media is meeting your business goals is to have a proper strategy.
Your strategy should include:
- Goals you want to achieve
- How to achieve those goals
- Track your performance with KPI’s (Key Performance Indicator)
- How will the goals impact your overall business goals
- Identify resources and tools that will help to achieve your goals
#2 Authenticity and transparency
Being able to offer connections between brands and customers is what makes social media powerful. In the B2B market, consumers always expect the truth. In a world with a lot of fake news and privacy issues, customers turn their back to brands if they fail to be authentic and transparent. According to Sprout Social’s Social media and the evolution of transparency report, 86% of people are likely to take the competitors product if the transparency of a business is lacking on social media. 81% of the customers think it is the responsibility of the business to be transparent.
#3 Targeting the same audience on every social media channel
Posting the same content on different channels is a common mistake business make. Every social media channel has different demographics such as age.
- LinkedIn: 36% are ages 18-29, 34% are 30-49, 28% are 50-64
- Twitter: 36% are ages 18-29, 23% are 30-49, 21% are 50-64
- Facebook: 88% are ages 18-29, 84% are 30-49, 72% are 50-64
- Instagram: 59% are ages 18-29, 33% are 30-49, 13% are 50-64
- Pinterest: 36% are ages 18-29, 34% are 30-49, 28% are 50-64
#4 Talking about yourself only
Social media is about being social. You are supposed to build a relationship with your audience. If you fail to focus on your customer and focus on yourself only your social media strategy will fail. Obviously, pushing your content is marketing, however, this might backfire on your social channels. Customers expect more value than just hearing about your achievements.
#5 Not understanding the ROI of social media
In fact, this is what experts struggle at too. Social Media does not directly relate to sales. It is similar to online shopping. People check products on the websites but not necessarily purchase them. It is also important to note that you need quality content. This could be videos, animations and pictures. Understanding the ROI of social media will surely put you on the right track.
#6 Failing to invest time and effort
Social Media strategies take time to work. If you have someone working 25 hours a week to post on your social media channels and expect him/her/them to make you go viral you are wrong. It is a long-term strategy that takes time to unfold its true potential.
#7 Not evolving
Businesses tend to be slow with catching up on trends. Social media is very quick to change the topics people talk about. The flexibility of a brand is important to be up-to-date with topics relevant to the business.
Last but not least, pointing out the difference between marketing and branding can be helpful for some businesses. These two get confused most of the time. They are the same but different. Both go hand in hand, however, they follow different goals.
We build strategies for technology companies and help them become the leader in their market. We hate seeing brands fail due to simple reasons!
Liked this article? Why not read “Importance of diversity”
If you would like to receive a complimentary brand assessment with the 3 Colours Rule agency
Would you like to find out what is preventing your brand from achieving your business goals? What if during a 30min call with us we could identify the areas of your brand that need improvement so that you can attract the right clients? We will use our D.A.C. (Distinguish, Attract & Convert) (explained in our YouTube video) growth system to swiftly evaluate your brand strengths and weaknesses. We will provide you with directives and your brand score so you can measure your progression. 3 Colours Rule will help you find your USP that resonates with your audience.