Branding: The Unspoken Hero of Startups

Branding: The Unspoken Hero of Startups


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Tomasz Tunguz of Redpoint Ventures is probably the only VC in the Valley who understands the importance of branding..

As a long-time marketing and branding consultant for startups, I am continually shocked at the reckless disregard that tech startups have for these 2 important principles.

Unless you have a truly defensible product, all startups have competitors who offer identical products (Groupon learned that the hard way). Strip down your product/service, and what do you have left? This is a question too few founders have asked themselves.

Branding is not just about telling a great story or having a memorable logo and slogan—its primary goal is to convey the company’s heart and soul to an audience. What does the company stand for? What is the personality? What is your message, and why should I buy into it?

Having a consistent message is the most important aspect.

The problem with most entrepreneurs is that they believe their message is, “My product is better than the rest, so it will win!” Big mistake.

Your product is not your brand. They are 2 completely separate entities. A Louis Vuitton handbag without the trademark logo is just a handbag without the added prestige.

The fatal conceit of founders is the belief that their PRODUCT is superior to all others. That may be true in some cases, but as you will see, having a better product without a message won’t count for much.

This is why technical founders should be balanced out by a Steve Jobs-type visionary. Silicon Valley has placed too high a price on individuals with technical prowess rather than vision.

Most ordinary entrepreneurs add more features and lower their prices in order to stay competitive, but this is unsustainable. But by doing so, you miss a grand opportunity to brand your startup.

Beachmint is a good example of this: By failing to convey a good message, they made desperate attempts to streamline and shore up inefficiencies. That might reduce your overall costs in the short run, but your customers don’t care about your bottom line—they never do.

People will not use your cool app or cloud software 24/7, but guess what? Your brand will ALWAYS be in the back of their minds. The question is: Will they remember it in a positive or negative light? Your brand is THE LAST OPPORTUNITY you have left to convince a customer to stick with you.

Think about why bottled water is a multi-billion dollar industry.

We all know that bottled water is filtered tap water, but we continue to buy into the scam because we’ve bought the message. Fiji Water is a good example. Although I should know better, they have completely sold me on it. Just look at the fancy logo on the bottle and the message on the back; it’s branding gold.

Another prime example is Zappos.

I’ve read dozens of pitch decks, and not once have I seen a mission statement that outlines the company’s message. Instead, founders fall into the trap of trying to use their product as their message.

This is something that would make Zappos CEO Tony Hsieh cringe.

You see, Hsieh isn’t trying to sell you shoes—he is selling you happiness..

Think about how powerful that statement is.

Zappos is fanatical about preaching this message..

There are hundreds, if not thousands, of places online where you can buy shoes, but Zappos has them all beat. Their website is sterile. There is nothing fancy about it. At first glance, all you find is a simple online shoe store. They clearly don’t compete on price alone, either.

But Zappos has created one of the best customer service experiences ever, and it shows. They make sure all their customers are happy, and Zappos’ superior customer service has become consistent with Hsieh’s message.

The Zappos corporate culture and the message it conveys IS the brand.

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In other words, the message influences all the actions of the company. Which one would you buy shoes from: a boring online store trying to sell you shoes or Zappos, who is selling you happiness?

By creating a message and having your actions be congruent to it, you create a powerful brand that will give customers a reason to continue buying from you.

As a startup, your brand will be the most valuable asset you have at your disposable. Leverage it wisely.

Reprinted by permission.

About the author: Jay Deng

Jay Deng is an angel investor and venture capitalist. He invested in two companies whose exits topped $800 million. He is also the CEO and founder of Diva For Less.

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