As a business owner, you want to be prepared if someone courts your business or when you’re ready to sell. A lot of that preparation advice comes from attorneys, lenders, financial planners and brokers on how to achieve the best multiple. But don’t forget the marketing side of that equation: How well you are known in the marketplace, your company reputation, proprietary trade names or processes.
This equates to brand value. In companies like Coca-Cola, Apple, Google and Starbucks, brand value trumps book value. So how do you get your business value to increase based on brand value? It starts with winning in mind.
Brand value represents the multiple that can be attributed to future sales generated from brand loyalty. From a marketing perspective, you should be scoring an above average multiple rating in your industry and be considered best in class in order to increase your potential multiple.
It is easier to be average today, so here’s how to be the exception:
Know what it takes
Be proactive. When you rethink best practices, you stop reacting to the market and start shaping it.
Have a keen understanding of your company’s differentiators. Recognize how your product or service differs from what’s in the market. Know why your offering is important to potential customers. Ask them. Address core needs overlooked by others in your market space. Lead somewhere exceptional. Own the mind share.
Look like the leader
Invest in your business. Inventory your marketing and how you measure up to others. Do you look like the leader?
Your online marketing should be solid, with an up-to-date, competitive and well-optimized website. Have a strategy for generating and tracking online leads and, if possible, know what share of online opportunities you receive.
How do you present your products or services? Do you create a memorable experience or appear like a “me, too?” Are trade publications regularly including your company?
Build brand assets by naming and trademarking your processes. This allows you to be the only one that can offer the iPhone® or iPad®, or proprietary ingredients, search algorithms or a loyalty club with millions of members.
Act like a leader
Operationalize your brand position. Build a culture that breeds brand ambassadors. Create processes around delivering first-in-class service. Communicate with passion and ad nauseam what the company brand stands for and why it is important to assure brand clarity, educate and inspire all employees to live the brand.
Also, keep customers and their needs a top priority. Figure out what it will take to earn customers’ trust — then hang on to them for dear life.
During a sale, these are considered intangible assets, which have been known to push the company’s value 30 to 70 percent beyond book value. While it takes some initial investment, the return can be greater than tangible investments in real estate, inventory, equipment and the like. Intangible assets may make more sense, both practically and economically.
Building brand value can produce nice rewards when it’s time to cash in your business investment.
Kelly Borth is the CEO and chief strategy officer of GREENCREST, a 25-year-old brand development, strategic and interactive marketing and public relations firm that turns market players into industry leaders™. Kelly is one of 35 certified brand strategists in North America and works with companies to establish brands and build brand value for their businesses.