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It’s a simple enough formula. You start a business, create a great product, and when the time is right, you launch a clever and carefully constructed marketing campaign to tell the world all about it. And once potential customers are made aware of all the good things you have to offer, the orders will begin to flood in.
But according to new research carried out by digital product developer, Studio Graphene, many of Britain’s early stage businesses are being held back by marketing and communications strategies that fail to ignite the interest of target customers. Or to be more precise, the marketing collateral deployed by young companies often confuses potential buyers, rather than telling them anything useful about the products and services on offer.
As founder and director, Ritam Gandhi explains, Studio Graphene creates “blank canvas” digital products for startups and corporate businesses. If a company requires, say, an app to help it execute its business plan, Studio Graphene will carry out all the necessary development and testing work. From that perspective, the company was keen to find out more about the reaction of customers – mainly in the consumer space – to the branding and marketing of new digital products.
What’s In A Name
So, Studio Graphene asked around 2,000 people from across the U.K. to look at ten company names and logos. Respondents were then asked to match the names and visual identities to descriptions of each company’s business model. All the businesses had recently secured Series A funding.
With one exception – the brand names chosen were not sector or product specific, and the research suggests that this could create a marketing problem. On average only 21 percent of respondents were able to connect either the name or logo to the sector or the nature of the business. The best performer was healthcare analytics company, Medopad, with 41 percent of those taking part, connecting it to the “healthtech” sector. Providing a clue clearly helps.
Should anyone be particularly worried about this? After all, the world’s biggest brands go to market with names that say little or nothing about the products they sell. For instance, Nike only says sportswear to consumers because it spends a lot of marketing cash establishing the connection.
But arguably young companies – or indeed any business that doesn’t have infinitely deep pockets – should at least think about the first impression made by their name or logo. More than half of those surveyed (55 percent) complained that too many businesses had obscure names. Perhaps more importantly, 62 percent said they would avoid contact with businesses that did not have a clear proposition.
The Trouble With Advertising
Perhaps none of this is surprising. As Gandhi acknowledges: “Businesses tend to start out by thinking about the product. They only start to think about the logo when it’s got to the stage where something has to go up on screen.” As he sees it, this misses an opportunity to create the visual identity – along with the brand name – at an earlier point in the development process.
You could argue, of course, the real heavy lifting is done by advertising and other forms of information-rich communication. But advertising, it seems, is not always effective when it comes to getting a message across. For instance, 51 percent of respondents said they regularly saw advertisements across a range of media that failed to properly explain the products or services that were being advertised.
“That means that about half of all advertising is wasted,” says Gandhi.
That’s probably an overstatement, but there is often a communications problem when tech-driven businesses begin to sell themselves to the public. As a business writer, I spend a lot of time looking at company websites as part of my background research ahead of interviews. Very often, the information provided fails to really explain the business and its product offering.
Gandhi’s advice is to communicate clearly. “Feel confident about your brand and the way you present it,” he says. “And it’s important to make sure that your message is always very, very clear. You should always make sure that people know what you are doing.”
Of course, a great many online businesses make their positioning clear from the outset. Read the name Deliveroo or WeBuyAnyCar and you instantly have a pretty good idea of what those companies do to earn their daily corn. But if the branding is less obvious, the research suggests that businesses will need to ensure that the rest of their messaging is razor sharp, if they are to engage their target audience.
April 14, 2019 at 04:51AM
Forbes – Entrepreneurs